In my college English courses, I remember studying Greek tragedies. We learned that these plays were compelling entertainment to the extent they leveraged two emotions: pity and fear. Pity for the protagonist whose life was in shambles, and fear that a similar fate may befall the audience members. The end of each play was marked by a catharsis—a realization by the protagonist that his troubles are a direct result of his actions, and the knowledge of how to make things right moving forward. Like most businesspeople, I love stories of successful companies as well as those whose decisions lead to their demise. The best stories are those with distinct watershed moments, turning points that either lead to great success or serious setbacks. Virtually every company can identify at least one of these situations in its past, and thanks to the benefit of 20/20 hindsight, the correct path is always crystal clear.
Because real life requires timely decisions when we sometimes feel like we’re flying blind, that’s what makes it so important that we learn from other companies’ victories and missteps. In a piece published on January 20, Bradley Hartmann does an exceptional job exploring Southwest Airlines and its Christmas 2022 epic technology meltdown. You can read Bradley’s entertaining and informative deep dive here: shorturl.at/nrzBN.
In a nutshell, Southwest Airlines says it cancelled more than 16,700 flights between December 21-31, 2022, which could cost the company more than $825 million. While there were a number of factors at play, the company’s outdated technology is in the spotlight. President and CEO Bob Jordan addressed this specifically when he wrote on January 17, “We are currently budgeted to spend more than $1 billion of our annual operating plan on investments, upgrades, and maintenance of our IT systems.”
As Bradley points out, Southwest Airlines’ leadership probably delayed investing in a major technology upgrade for the same reason many of us delay upgrading our obsolete systems. “Costs a ton of money. Takes forever to implement. Employees resist change. It frustrates your customers.”
While our business may seem very different from an airline, it’s a fact that we’re both in the logistics business (they move people; we move materials). And technology is allowing us to work better and smarter than ever before. For me, the takeaway from this story is that technology is a tool, and it’s up to us to make sure we have the right tools in the right hands. If we rely on a tool past its expiration date, we do so at our peril.
Thankfully, we’re part of a community that’s known for sharing both its successes and its cautionary tales. That’s why the LBM Strategies Conference continues to grow, and how it enables and empowers LBM pros like you to thrive in a wildly competitive market. Here’s to working together, and to learning from cautionary tales from other industries.
— Rick Schumacher
Executive Editor & Publisher