Companies That Get It

As we thought about companies whose success can be attributed to superior leadership that resembles that of the Marine Corps, FedEx and Southwest Airlines immediately came to mind. FedEx Chairman, CEO, and founder, Fred Smith, is a former Marine, and the lessons he learned during two tours in Vietnam, first as a platoon and company commander in the infantry and later as an aerial observer, have directly influenced the leadership philosophy that he has instilled in his company. Southwest Airlines cannot claim a former Marine as its CEO, but it can claim the next best thing: to have participated with the Marines in a two-day joint leadership development workshop that reinvigorated the company s celebrated culture of caring, fun, and outrageous customer service. ^[8]

FedEx

Fred Smith trusts approximately two hundred thousand FedEx employees and contractors around the world to put forth the extra effort necessary to ensure that his company can deliver on its promise of absolutely , positively the broadest array of transportation, e-commerce and supply chain solutions in the world. ^[9]

In building and leading FedEx, Smith has relied heavily on the lessons he learned in the Marine Corps. And he has even gone so far as to articulate , adapt, and institutionalize those lessons through the Manager s Guide , which has been a mainstay for all FedEx managers since he penned it in the early days of the company s existence.

FedEx considers each and every contact with the customer the moment of truth ^[10] and therefore calls on its managers to set an example that encourages frontline employees to project the highest standards of professionalism and put forth the extra effort necessary to deliver 100 percent satisfaction to extremely demanding customers. To these ends, FedEx managers maintain the highest standards of personal appearance and exhibit a positive, composed external demeanor at all times. They admit to mistakes and apologize when wrong. And they make themselves both available and visible during peak periods of activity, such as night shifts and holidays. Finally, FedEx managers are expected to earn the trust of their employees by doing what s right ^[11] and are reminded that their jobs exist primarily to help their employees exceed customer expectations. ^[12]

At the core of FedEx s corporate philosophy of People ”Service ”Profit is the belief that if the company takes care of its people, they will take care of the customer, and profits will naturally follow. Says Smith, Federal Express, from its inception, has put its people first both because it is right to do so and because it is good business as well. ^[13] Of the many ways in which FedEx takes care of its people, three stand out as particularly noteworthy: People Help , Encouraging the Heart , and Survey-Feedback-Action .

People Help is a company- funded program that provides FedEx employees with support and counseling services should they encounter serious personal challenges, such as substance abuse, marital discord, financial distress, or work- related issues. Encouraging the Heart is a tiered system of positive reinforcement built on the tenets of the Marine Corps, whereby the company recognizes and rewards the superior efforts of employees. Recognition ranges from atta-boy stickers reading Bravo Zulu ”a term borrowed from the U.S. Naval Service ”to Five Star Awards, which are accompanied by stock options and formal mention in company meetings and publications , to Golden Falcon awards for heroic acts, such as performing CPR, saving someone from a burning building, or stopping a robbery. And since 1979, FedEx has employed the Survey-Feedback-Action program to ensure that it listens to all of its employees by each year soliciting their ideas as to how to improve the corporation s work environment.

Finally, borrowing heavily from Smith s experiences in the Marine Corps, FedEx employs a structured process that can best be described as screen , train , coach to develop its leaders , most of whom are promoted from within the organization. The ASPIRE ^[14] program, FedEx s equivalent of OCS, screens potential leaders and places considerable emphasis on company values and principles. Candidates either volunteer or are selected by frontline managers and then attend an ASPIRE workshop. After the workshop candidates must successfully complete three tests: a standardized employment test, a managerial personality profile, and a peer evaluation. Needless to say, attrition is high.

Graduates of ASPIRE proceed to level 1 of the FedEx Leadership Institute, the company s equivalent of The Basic School, where they receive extensive training in those practices that FedEx considers central to leading ”note the deliberate distinction from managing ” high-performing businesses. Graduates of level 1 return to the Leadership Institute later in their careers for levels 2 and 3, and FedEx also offers other ongoing continuation education courses outside of the Leadership Institute.

Once screened and trained, managers at FedEx spend a good deal of their time coaching. Not only must they motivate those employees who have no desire to become managers to maintain superior levels of performance, but they must also groom future managers. Frontline-level managers must select and mentor ASPIRE candidates, and each middle and senior management position in the company must have two identified successors. According to the Manager s Guide , An infallible measure of success for any managerial assignment is its legacy. ^[15]

Owing to his efforts to articulate, adapt, and institutionalize what he learned in the Marine Corps, Smith has not only built a winning organization at FedEx but also secured his own legacy as a leader among chief executives in corporate America.

Southwest Airlines

In December 1998, twenty midlevel and senior managers from Southwest Airlines reported for duty at the Marine Corps base in Quantico, Virginia. Their mission: to exchange ideas with twenty Marine counterparts on the topics of instilling and reinforcing organizational values, inspiring higher levels of frontline performance, and developing leadership. The groundbreaking workshop accomplished two major objectives for Southwest: validation of current leadership practices and the stimulation of new companywide initiatives.

The workshop validated many of the company s existing leadership practices. Former CEO Herb Kelleher had already made a regular habit of joining his frontline employees on holidays to help load bags or attend to customers. Company leaders had long maintained a close-knit, supportive, and familylike work environment and placed considerable emphasis on celebrating and rewarding the successes of employees. And Southwest had already established its own recruit, train, mentor approach to leadership development. Zany messages such as Work in a place where Elvis has been spotted . . . send your r sum s attention Elvis (caption below a photo of Kelleher in an Elvis costume) and a rigorous review process ensured new applicants attitudes fit with Southwest s unique culture. A department known as the University for People had been established to house most of the company s formal training and leadership development programs. And Southwest had already established a mechanism, the Quest Program, to encourage inexperienced frontline supervisors to create leadership partnerships with older, more experienced employees.

The workshop also spawned four companywide initiatives. Company leaders began to place greater emphasis on encouraging employees to hold one another accountable for upholding Southwest s standards of excellence. More than anything, the workshop made us realize that we hadn t been focusing on what parts of our organization were truly important, said Donna Conover, workshop participant and now executive vice president of customer service. ^[16] First, concerned that it was falling short on instilling company core values in new hires, Southwest overhauled and renamed its orientation program. The new and improved FLY program ”for Freedom , Love , and You ”assigned considerable importance to caring as a means to promote mutual trust among all employees and loyalty to the organization as a whole. Second, Southwest shifted the emphasis of its leadership training efforts from empowerment to decision making. According to Conover, Empowerment is about giving people options; leadership is about making decisions. We wanted our people to be more than frontline employees. We wanted them to be frontline decision makers . ^[17] Third, to emulate the Marines practice of carrying a core values card, inscribed with honor , courage, and commitment, Southwest included on all company identification cards the motto Spirit. And fourth, impressed with the Marine Corps hymn, Southwest had a company song written.

The impact of the workshop can be seen clearly in the company s words. Said one workshop participant during a teleconference in 2002: ˜If people don t see leaders modeling the behavior, they re not going to believe it, and ˜The bottom line takes care of itself when you take care of your people. ^[18]

And in the difficult years following the workshop, Southwest s actions and accomplishments have done justice to its strong leadership tradition, warrior spirit, ^[19] and interaction with the Marines. In the wake of the September 11, 2001, terrorist attacks, which plunged the airline industry into perhaps its worst-ever market downturn, Southwest management went to great lengths to keep concerned employees informed of the company s operational plans and provide reassurances that there would be no layoffs. Amid a wave of bankruptcies or near bankruptcies among its competitors , Southwest has managed to remain profitable ”without layoffs ”by avoiding infighting and pulling together as an organization.

^[8] Southwest company slogan .

^[9] FedEx company slogan.

^[10] Smith, Frederick W., et al., Manager s Guide ”USA: The FedEx Express Guide to Leadership , February 2002, 52.

^[11] Ibid, 73.

^[12] Ibid, 188.

^[13] Ibid, 1.

^[14] A ssessing S kills , P erformance, and I nterest R equired for E ntry into management.

^[15] Smith, 116.

^[16] Phone conversation with Donna Conover, June 17, 2003.

^[17] Ibid.

^[18] Devlin, Dory, Culture Helps Airline Stay Aloft, The Star-Ledger , November 4, 2002.

^[19] Company slogan. Also appears in Freiberg, Kevin and Jackie, Nuts: Southwest Airlines Crazy Recipe for Business and Personal Success , 1996, 27.