What the Best CEOs Know - 7 Exceptional Leaders and Their Lessons for Transforming any Business

JEFFREY A. KRAMES

McGraw-Hill

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Copyright 2003 by The McGraw-Hill Companies, Inc.

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ISBN 0-07-138240-2

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First Edition

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Chapter 7: From NUTS! Southwest Airlines' Crazy Recipe for Business and Personal Success by Kevin and Jackie Freiberg. www.SDCGInc.com.

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To my parents, who turned a small apartment in the Bronx into a learning organization of their own

And to my incredible wife, for her unending patience and encouragement. An author, and husband, has never had a better partner.

ACKNOWLEDGMENTS

In researching and writing this book, I was fortunate enough to secure the cooperation of several key CEOs and business experts, whose assistance and insights helped make this a richer book.

Let me begin by acknowledging the CEOs (and former CEOs) who took time out of their busy lives to respond to this author's list of queries. Although he was mapping out his own memoir at the time, an unselfish Lou Gerstner went to great lengths to patiently answer each question regarding his turnaround of IBM (in a 6-page document). In his answers were many valuable insights that helped to unlock some of the mystery surrounding his turnaround of the deeply troubled computer maker. He proved that in the long run, attitude and culture are as important to organizations as balance sheets and income statements. I am grateful to him for his thoughtful analysis.

Michael Dell also agreed to be interviewed, and provided a wealth of information on how a customer-centered organization is created and maintained. He showed how an organization could gain market share in even the worst of economic times, even when so many technology firms were going off of a cliff. He demonstrated that delivering superior customer value could provide the greatest competitive advantage of all.

I also wish to acknowledge Herb Kelleher, who scribed a lengthy response to a set of questions aimed at getting inside the mind and methods of the man that founded the world's most profitable airline. The former CEO of South-west Airlines answered my queries in writing, a lengthy document that included his rules for running a large organization. Since he has not written his own book, I am in his debt for contributing his original ideas to this work.

I also wish to give special thanks to Northwestern's Phil Kotler. Dr. Kotler was gracious enough to grant me an extensive interview regarding the CEOs in this book. He also contributed several new ideas while challenging my thinking in several key areas. I am grateful to him for taking the time to assist this author in his pursuit of the leadership threads of the best CEOs.

I would like to thank the individuals who reviewed the manuscript and provided valuable insights: Dr. Joe Goldblatt, Dean of the M. Shawn Feinstein School of Business at Johnson and Wales University, and Harvey Thompson, a former Global Practice leader at IBM. Thanks also to Denny Cummings of the Chicago Union League Club for his assistance and encouragement. I also express my gratitude to Jeffrey L. Cruikshank, for taking his pen to this work, once again enriching a book by applying just the right touch.

My wife, Nancy, merits a singular note of acknowledgment. She showed infinite patience over the almost four years this project developed. She read so many different drafts she likely lost count, always offering helpful advice and guidance along the way. She is a talented individual and a wonderful partner, and I offer thanks every day for having her by my side.

I would also like to acknowledge the efforts of the talented team at McGraw-Hill. My editor, Philip Ruppel, made the type of suggestions that only he could, helping to keep the manuscript on track from its earliest rendition to the final draft. Thanks also to Lynda Luppino, Anthony Sarchiapone, and David Dell'Acio for his creative cover design. Lydia Rinaldi, publicity manager, always brings great enthusiasm to each project, and I am grateful to her for her fine efforts. Peter McCurdy, production manager, has again shown that he can manage details expertly, turning ideas and the written word into a first rate product. I also offer my gratitude to Chitra Bopardikar, Amanda Yee, and Allyson Arias, for her dedication and hard work from Florida to Frankfurt.

Lastly, I offer my thanks to my family, Trudy, Barton and Paul. My father, Barton Krames, deserves special acknowledgment. He showed that the hard fought lessons in keeping a small shop on Kingsbridge Road solvent and successful apply to organizations far grander in scale. He taught me, in deeds more than words, that there is no substitute for perseverance, hard work, and commitment. He knew each of his customers by name and never refused to deliver an order, even if it meant traveling long distances to do it. By attending to each customer as if his business depended on it, he was able to keep his shop afloat long after most of his competitors closed their doors. I am grateful to him for passing on those timeless lessons. I recognized them quite clearly when I encountered them again in the leadership acts of the CEOs who fill the pages of this book.