When we think of the words fun and love, the last thing we associate it with is business. However, without many knowing it, some of the most successful businesses operate from these two things. One of those is Southwest Airlines. In this episode, Jesse Cole is joined by Kevin Freiberg, the co-author of the International best-selling book Nuts!: Southwest Airlines’ Crazy Recipe for Business and Personal Success. Here, Kevin shares the secrets behind the greatest success story in commercial aviation, how Herb Kelleher reinvented air travel, and what it is about putting fun and love into one’s business that makes it thrive. He also touches on fear-based culture versus fun-based culture and what it means to reward intelligent failure. Join Kevin and Jesse in this conversation as they share some great wisdom that is much-needed in this time of the pandemic, helping you innovate and build a better culture.
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Nuts!: Fun And Loving Secrets Behind Southwest Airlines’ Success With Kevin Freiberg
Our guest is Dr. Kevin Freiberg. He and his wife, Jackie, had co-authored eight business books, including the international best-selling book, Nuts!, the story of Southwest Airlines. Kevin and Jackie had presented to over 2,000 companies across the globe, challenging leaders to stand out instead of fitting in a sea of sameness. As Founders of Epic Work Epic Life, they challenged leaders to dream big, disrupt the status quo and achieve the impossible. This show was made for the Freibergs. Kevin, I am fired up to welcome you to the show.
I’m glad to be with you. I’m honored to be on.
We’ve been paying our staff to read for many years individually, the Better Book Club. We said, “We’re going to do one as a team.” We decided to do it in February of 2020. We were going to do a couple of chapters every month. All of a sudden, the pandemic hit. We went through your book and Jackie’s book, Nuts! during that time. I couldn’t imagine a better book to be reading during the time of the pandemic as we’re trying to innovate and build a better culture. I want to take us back to the first time that you met Herb and Colleen. You went in and did full research of this company and got in there. I want to go back to what you saw with them that stood out as far as their culture before we talk about some of the lessons of the book.
Jackie and I went through a doctoral program, not at the same time. Jackie went through four years after me. It was a program in transformational leadership at the University of San Diego. The professors there made us believe that we can go out and do something in the world and change the world. You’re young. You’re coming out of grad school. I believe them. Who would think? Right before grad school, I had been helping a friend build a distribution company for a cowboy boot manufacturer in Palma, Mallorca, Spain. It was based in Albuquerque. We were in and out of Texas. I met a flight attendant. We’re on the planes back and forth. You get bored so you chat it up with the flight attendants.
Long story short, I was talking about going to graduate school. I met this flight attendant and she said, “You need to meet Herbie.” I was like, “Who is Herbie?” She was like, “He’s our chairman. He’s our boss.” She talked to us normally. I said, “Tell me about Herbie.” The more I learned, the more I said, “I got to meet Herbie.” Roll the tape forward, I asked Herb and Colleen if I could come down and do my doctoral dissertation on them in Southwest Airlines. The reason was because I learned enough about them to say, “Here’s the company that is not afraid to talk about loving people. They are always going left on red in terms of doing different things. They have a lot of fun doing business and yet they’re this disciplined, on time and safe airline.”
You can’t run an airline if you’re not disciplined. People think, “You can either be fun or you can be disciplined, but you can’t be both.” I’m going, “This is a beacon on a hill. This is a shining example of everything I’ve been learning and what I want to write about.” When I wrote to Colleen Barrett, one of the cofounders, she said, “We’d love to have you come, but we have a battle going on with the United Shuttle on the West Coast. This is going to take time if we’re going to do it right. We don’t have the time, sorry.” I wrote her back and said, “You don’t understand. If you don’t say yes, you will be halting the advancement of leadership studies from here to the end of the kingdom come. You can’t say no to this.” I kept pressing and finally, she said, “We got a little window. Why don’t you come down?” That started the greatest business relationship of Jackie’s and my career.
When you met Herb and Colleen, and got over to their headquarters and spent time, what were the things that stood out that you were like, “This is a little different?” I want you to take us behind the scenes. It’s one of the best things you do with these gutsy leaders. Share to us a little bit about what you remember seeing how they led and how they carried about their business.
I remember it vividly like it was yesterday. It was a long time ago. The day I met Herb, I’m nervous. I’m a grad student who was on doctoral research. I don’t have a lot of business experience and here’s this big airline. The first thing I remember, I walked in and Herb got a cigarette in his mouth. He reached through the door of his office, grabbed me, pulled me in and said, “Kevin, how are you?” In a nanosecond he disarmed me. That’s the magic of what’s going on there. That personality ripple throughout the whole culture of the organization. They aren’t pretensive. They aren’t trying to be somebody. Herb said, “Why do you have so much fun in your culture? I want to go to work and have fun. I want to be with people that I have fun with.”If you want to have more fun, be yourself. Click To Tweet
That’s the first thing I remember. I was nervous. From that point on, it started a dear friendship. When we did the research for Nuts!, we brought our Freiberg team down. I said, “You’re part of us. We’re going to write this book. You need to know about these guys.” I remember Trish Derho leaving the corporate headquarters one day. She said, “This is more like church than church. These people love each other. They care about each other. They laugh and they have fun. Yet, they get things done and they move dirt.” I said, “That’s the magic. That’s the secret sauce.” We learned right away that you can have fun. You can talk about loving people.
At that time, they might have been 5,000 employees. As they grew to probably 35,000 or 40,000 before Herb stepped down, they had a network within this culture that if somebody passed away, somebody’s mother passed away, somebody had the birth of a new child, somebody was celebrating a 40-year anniversary, they had a system that percolated up to Herb and Colleen. You would get a letter. You would get a basket of goodies. You’d get something from the home office that said, “We love you. We value you.” They used to do a thing called plane tales. It was one of these little audits. How many weddings, funerals, births and baptisms did Herb and Colleen attended every year? It was probably close to 1,000. My point is you can run a business like a family. People will say you can’t, but you can. If you treat people like family and adults, they’re going to act like a family. They’re going to act like adults and you manage the exceptions.
I will bring up a debatable game later because of the family versus team, and as we will talk about Bruce Bochy and all this. There are a lot of debates on family versus team. Netflix goes strongly the other way. I want to get into that later, but the fun and the love that you talk about, there are few books about fun and business. If you search marketing, sales and values, there are tons of those, but fun and love, there is a handful. Yet, when I think about what we’re trying to build here with Savannah Bananas, fun and love are right at the top. We have the three loves as part of our Fans First Playbook. Love your customers more than you love your product. Love your people in your team more than you love your customers. Love yourself above all to be your best for everyone else.
We talk about it. Fun is everything. Back to the end of nights after a game, we’re at the ballpark at 8:00 AM. At midnight at 1:00, we’re all having food and drinks. We will go and play kickball. I’m like, “How are we still doing this?” It’s wanting to be around each other. That’s hard to teach. I would like to dive into this. It’s different because I know we talk about disruption and I want to get to that, but fun in business. They talk about hiring for fun. You shared how you and Jackie hire for fun and how you don’t take yourself too seriously at work. Can you share a little bit of those insights that you’ve learned from Southwest?
Their whole thing is if you fly Southwest, you will see singing flight attendants and they do comedic routines. Nobody teaches them to do that. It’s a contagious ripple effect. What they say is, “Bring your personality to work.” Your thumbprint is different than mine. You bring something, Jessie, to the world that Emily can’t bring to the world. Emily brings something that you can’t bring and that I can’t bring. When we bring what we’ve been made to do and created to do, there’s this symphony of incredible gifts and talents that come to play. Herb always said, “Don’t check your personality at the door. You get on most airlines even now, it’s loosened a little bit but even in the day, when Southwest was growing, if you go fly other unnamed airlines, everybody is stiff and professional.
If you’re stiff and professional, stiff and polish, everybody thinks you’re safer and better run. Frankly, everybody’s just bored. Herb said, “Bring your personality to work and however that plays out, we’re good with it. We’ll manage the exceptions to the rule.” I’ll give you an exception. On a 737, by FAA requirements, you have an A flight attendant, B flight attendant, and C flight attendant. This was back in the days when they wore khaki shorts and polo shirts. It’s a late-night flight at 10:00. It was the last flight of the evening and the plane isn’t full. Everybody is either in the middle of the aircraft or at the front, and there’s nobody in the back.
Yet, the A, B and C flight attendants still have to give the FAA safety announcements. The C flight attendant is in the back. She’s got nobody back there. She was trying to make the B and A flight attendants laugh. She bends over and moons with the B flight attendant. About the time she does, this old lady, a passenger looks back to the flight attendant. She’s up in arms and was like, “I can’t believe you could be that unprofessional. This is crazy. What kind of airline are you?” She wrote to Herb. Herb pulled out one of his Herb cards and wrote a note back. He said, “Ma’am, I am sorry you caught us with our pants down.”
I’m sure they talked to that flight attendant. They said, “There’s a line to be drawn and you shouldn’t cross it.” In this day and age, that would be much more egregious than it was back in the early 2000s. My point is, if you’re going to encourage people to have fun and love, you will have people step over the line, but does that mean it’s not right to do? No. It just means you manage the exceptions and reign it into wherever the boundaries are.
If you look at it, it starts a lot at the top. If you have a leader, a CEO who’s professional like Herb, who didn’t get into arm-wrestling matches over the names. Herb’s costumes were a big thing for him, but it starts at the top. He made it acceptable to be fun. I wonder where leaders can take this and say, “Where does it start?” It started by getting rid of policies and saying, “Let’s dress more freely by walking in with costumes sometimes.” For instance, this is something that we have at our ballpark. It’s our Dolce & Banana underwear. What we do is our staff like Patrick sometimes, he’ll be rocking it. He’s in the back corner and making phone calls. It’s funny or ridiculous, but that has to be applauded, not, “What are you doing?” I’m trying to think about how a company can instill more of this. The hiring is important. Is there anything else you’ve seen in companies that you’ve learned from Southwest that started using this more to try to bring more fun into their culture?
The one thing that comes to my mind immediately is for senior leaders because it does ripple out at the top. We have both been in fear-based cultures. You can smell, feel and touch them a mile away. Usually, you can trace that right up to the top that people are afraid. Herb then pulled me into the office, disarmed me, and it wasn’t just me. He does that with everybody. It creates this more level playing field. My message to senior executives is if you want to have more fun, be yourself. That’s number one. That requires some vulnerability.
Putting underwear on out in front of everybody, or maybe with the board of directors. You come in with your underpants on or in Bananas outfit, whatever it is that requires a level of vulnerability that says, “I’m comfortable enough in my own skin to be me, not to be me that the board, the customers or the media wants. When I talked to senior executives, I say, “Start with being you. What does fun look like for you? Maybe fun for you isn’t dressing up in a yellow tux.” For you, you nailed it. It’s become a signature, but for somebody else, maybe it’s as simple as taking your senior team offsite and go on and saying, “We’re not going to talk business. We’re going to go shoot skeet and have a couple of beers, and get to look under the hood of your life, and get to know who you are.” Fun comes in many flavors. I don’t think it has to be the Southwest flavor or the Savannah Bananas or the Freiberg’s or whoever. It’s got to be you and it’s got to be real.
A lot of times, people need examples too. For instance, the Southwest Shuffle that they did or the ‘86 Super Bowl Shuffle. When we were reading that it was during the pandemic. We said, “Let’s all do our own music video.” We sent everyone home and filmed Dancing With Myself by Billy Idol. During the pandemic Dancing With Myself and we had everyone turned their cameras on. You’re right, that does take vulnerability. How would an introvert do that? We are doing it as a team. We said, “Everyone, do a video of yourself. I’m in the bathroom, singing into a plunger, which was disgusting in retrospect, but we’re all having fun and doing it.” We put it out and that starts gravitating more people to have fun and it takes examples. Reading about that Southwest Shuffle, I never knew about that. I was like, “Let’s do one music video with our whole staff during this time and put it out.” That’s part of the things.
Vulnerability is contagious because my thing may not be singing in the bathroom to a plunger, but I’m going, “If he can do that, I can go do this other thing.” It has a tremendous ripple effect because somebody was willing to break the ice and be vulnerable.
I want to go from that into celebrating everything. This was a chapter you had in Nuts! about celebrate everything. This is so key, especially now. Share a little bit of that insight, maybe some stories and things that are done, and how companies can find more ways to celebrate.
Let’s talk about what you celebrate because when you say everything, everything means everything. Southwest is magnificent. If you walked their hallways and saw the decorations on the wall, thousands and thousands of square feet of pictures of employees doing heroic things. You walk through it and it is like a museum. You would say, “Who are the heroes of this company?” There are thousands of them because they’re constantly being celebrated for doing things.
What type of heroic things? What were they showcasing?It's the eccentric people that are changing the world. Click To Tweet
They have a program called Heroes of the Heart. It’s now company-wide. It is nominated and voted on through a committee company-wide, but it’s a department that is lauded for outrageous service. It could be internal customer service with employees or it could be with the people who fly on the airplanes. It could be a municipality or department that has to work with the City of Chicago to get more gates out at midway. Whatever it is, that department is nominated. The name of that department flies on the outside of an airplane for a year and they call it Heroes of the Heart. I’ll give you another example. The FAA keeps three statistics, on-time performance, best customer service, and I can’t remember the third one.
They’re simply three statistics kept by the FAA and the Department of Transportation. Southwest was the best in a year. They went out and bought themselves a trophy called the Triple Crown. They won it four years in a row. It’s like you won the world series four years in a row. How do you keep this team motivated to win another one? They said, “We will do something incredibly special for you if we can win number five.” They won number five. They’re going to buy an airplane anyway because they’re constantly adding airplanes to the system.
They painted this airplane and called it Triple Crown One. At the time, they had 25,000 employees and on the overhead bins in the airplane were etched the signatures of every one of those 25,000 employees. If you’re a passenger, you’d get on the plane and you see the plane maybe painted from the outside. You put your bag and slam down, and you see 50 signatures on this panel. You’re looking at the flight attendants and asked, “What’s that all about?” “I am glad you asked, we’d love to tell you. Did you know that we’ve won the triple crown five years in a row?” Think of the pride of a flight attendant, a pilot or a provisioning person that gets asked that question, and then gets to tell their story.
It is a huge form of recognition and saying, “If you want to know what we value most, it’s our people.” You said it earlier, but I want to put an exclamation point on it. I asked Herb one day, I said, “Herb, who comes first, customers or employees?” He didn’t hesitate. He said, “It’s always the employee because if you love your people and your people are happy, your people will do extraordinary things for your customers. If your customers are happy, they will make your shareholders and the media happy, and your business will grow.” They have things that are heart-wrenching. I remember reading one of their stories.
It’s a woman who’s leaving. She’s on the plane and the plane is pushed from the gate. She gets a call that her father has gone into the last hours of his life at the hospital. She says something to the flight attendant. The flight attendant talks to the pilot. If the pilot has already pushed from the gate and they’re going to go back to the gate, they’re going to take a delay. That’s a no-no in on-time performance. The pilot said, “It’s a no-brainer. We’re taking her back to the gate and get her off of this airplane.” Not only did they do that, the ground ops people at that station, I believe it was Chicago, had a car waiting for her. They drove her straight to the hospital so that she could be with her father in the last hours of his life. She made it on time before he passed. There are thousands of stories that happen like that.
Ask yourself the question, in a fear-based culture that’s all about on-time performance, and they pride themselves on on-time performance. If you’re the pilot, are you going to pull back to the gate, or what do I do? There’s a higher ethic. There’s a higher morality. There’s a higher cause there than just on-time performance and we’ll take the delay. My point in sharing that is when you have a fun culture, even with serious things like that, you say, “I might take the hit for this, but I’m happy to take the hit for this because if Herb were driving this airplane, that’s exactly what Herb will do.”
As the readers know, the name of our company is Fans First Entertainment, but our goal is to make our people and our teammates the biggest fans of the company. To do that, you have to put them first, but it’s hard sometimes to think because you’re leading with your customers. You have to be strategic. You got me thinking there. When we eliminated all our advertisements and go left on red. We said, “We’re going to create an ad-free ballpark because no one wants to be advertised to or sold to a market.” We developed a fan wall where we’re going to let all fans sign the wall to get their signatures on our 1926 ballpark, but then I’m kicking myself, “What are we doing? Why aren’t our people signing something?” As you shared that story of Southwest, how are we recognizing them?
If we eventually have a Fan Hall of Fame, why don’t we have our teammate in our People’s Hall of Fame around the stadium that they can take their parents and say, “I’m in the Savannah Bananas Hall of Fame.” That could be a frontline person. That is powerful. You got me thinking about what we’re going to do, but that’s so key. One thing that you shared with Southwest was Walk-A-Mile in the Shoes in which was such a fascinating thing that we started doing. We started going frontline. I worked concessions without my yellow tux in. I learned more in two hours than I’ve ever learned before, but explain the Walk-A-Mile in the Shoes and why every company should be doing it as well?
It’s a powerful concept. All these concepts tie together because if you walk a mile in somebody else’s shoes, you will have a lot of fun. There’s so much talk about empathy. It is maybe one of the most underrated weapons in a leader’s arsenal. If I believe you care about me, know me and are interested in me, we can have a dialogue and I will reach higher for you for the company, for the cause, for the movement. The Walk-A-Mile program was how does one department go out.
Let me give you an example. LAX is a busy airport. During thick times like Thanksgiving, which the day before Thanksgiving is the busiest travel day of the year in the airline industry, at least it was before COVID. LAX is getting slammed. You would have people in other parts of the system that are off. They’re not being paid to do this and say, “We’ll volunteer.” They paid the expenses. They put them up in hotels and whatnot. They were like, “We will go out and shore them up. We will go out and serve them. We will go out and work with them for 2 or 3 days and help them deal with the craziness.” Walk-A-Mile has many dimensions. Here’s another Walk a Mile. We called it Downline Station Visits. Let’s say a flight originates in LAX and the next series of flights are going to go to Phoenix. They’re going to go to San Jose. They were going to go to Denver.
The downline station visit was they would take a team from LAX where the flight originated. They’d go to that downline station, Phoenix, for example, and say to the Phoenix station, “What are the top ten headaches we create for you at LAX?” “The through count on passengers wasn’t correct. It’s frequently not correct. That’s a pain in the ass for us. If we can fix that.” The whole thing was you don’t go and “yeah, but” them. You don’t go to Phoenix and go, “We understand that’s a problem, but the reason we do it that way is because this and this.” There’s all this justification and rationalization. They simply went and said, “What are the top ten headaches we create for you?” They listened and they came back and said, “What can we control and what can’t we control? Whatever it is we can fix, we’re going to fix.”
We’re going to send a message back to them and say, “Thank you. You told us that these were the top ten. Here are the five that we can control and we can fix. Here’s what we’ve done about it.” Think about the power in an entire system. When you got people doing that everywhere. You’ve got the front office going down to the manager and saying, “What are the top five headaches that we create for you in the front office, in our advertising, in the way we bring people into the ballpark?” The manager who’s focused, in your case, on the team but the entertainment, “What are the five headaches we create for you guys in the front office and trying to build this thing and move it forward?” There’s no shame and blame in all this. It’s simply, “We’re a team. We’re a family. Let’s fix it and move on. The more we fix, the more empathy we have, the more well-oiled this machine becomes.”
I love that Herb Kelleher’s strategy plan is called doing things. I like this context because we started with a lot of culture, fun, hiring, empathy, and that can lead to even greater innovation. If you have a culture where it’s fear-based and where there are struggles, it doesn’t lead to innovation. I got to go to a quotable because I heard you on a podcast. This quote fired me up. You said, “Innovation is everyone’s job. Innovation is inherent to every job in the organization. If you’re not constantly thinking one, how do we grow the business faster, differentiate the business more, make the business better? The organization is being ripped off because you’ve got a lot of creative talent that isn’t being tapped.” I want to go into that. We’re going to start going innovation, go business done differently. You got the culture and now you’re saying it’s everyone’s job. Where can we go from there? Is it a starting point like Herb Kelleher did what-if sessions? Where can we go into how to get innovation a part of a culture?
First of all, you have to understand that everybody is creative. The problem in many companies is we relegate innovation to the R&D staff. They have many names. The strategic initiatives part of the organization or even marketing has a big play in it. Marketing is looking at trends. What are the trends out there? How do we adapt to those trends that are shifting tectonic shifts in the marketplace? All that’s good, but the fact of the matter is you’ve got many types of innovation. You’ve got brand innovation. You’ve got marketing innovation. You’ve got process innovation. You’ve got product and service innovation. Everybody plays a role in that. If we’re talking about a process improvement, who are the true experts at that?
The true experts are the people who are using the process every day. The true experts are the people who see the waste and the redundancy, and the stupid crap that people have to work around every day to get their jobs done. If you say to them, “You’re responsible. You’re creative. You’re innovative. We value you.” What’s the fix? If you were CEO for a day and you had this goofed-up process between the handoff from the call center to the warehouse who puts the box on a truck that gets to somewhere, what would you do to fix this process? I don’t care if you’re an organization of 2, 200 or 2,000. If you got 2,000 people that come to work every day and say, “Innovation is my job, it’s not a collateral duty. It’s not something we hand off to the geniuses with white coats in a lab somewhere.”
You got everybody asking questions like, what if we could take a radio transmitter in health care and put it in a little pill that sends a time-coded secure thing to a patch on the patient’s arm that dates and time codes that the med has taken? That could send it to the caregiver and say, “We know they’re taking the right med at the right time, in the right place.” How many billions of dollars could we manage out of the healthcare system because somebody thought of that? A significant percentage of the problem of waste in healthcare is people not taking the right med at the right time. Think about if somebody came up with that. I don’t know about you, but I want everybody in my organization thinking about how to grow the business faster, improve the business better, and differentiate the business more because I’m a smart guy and I have a lot of education. I don’t know it all. I can’t be it all. I don’t want to do it all. I want to do it with my people.There's no growth inside the comfort zone. Click To Tweet
You can either be a spectator or you can play the game. The way we look at it even at our games, our spectators for every other baseball team, they’re a huge part of the show. We strategically script the show. They are dancing, singing and going on the field. They are experiencing. They feel more ownership in what they’re doing. That’s what the fan perspective, but you have to make it feel internally with your team. How are they not just like, “Someone else will fix this?” First, we need problem finders and then problem solvers. A lot of people said, “It’s not my problem.” What have you seen more? I love the top five headaches. Is there any other thing that you’ve seen and said, “Let’s get more people sharing?”
You give people some tools. In your organization, I’m flattered, honored and I thank you that Nuts! resonated for you. You took them and you put your own twist, your own brand, your own thumbprint on it. I’m a big fan of telling companies to get away from best practices because the best you’re ever going to be following somebody’s best practices is a good number two. What we ought to be teaching everyone who innovates craft is we ought to be asking them, what’s new? What’s fresh? What’s next? What if you spent an hour a week what-iffing our business? What if we could do this? That leads to a second tool that we think is powerful, which is you’ve got to question the unquestionable. The unquestionable are those tried and true assumptions, taken for granted assumptions that every company makes.
It’s the sacred cows. It’s the way we’ve always done it, things that are never questioned. What if we questioned those? Herb Kelleher said, “Why do we need a hub and spoke system in the United States of America? Why do we take people out of Roanoke, Virginia, the small little airport, fly them into a hub like Atlanta, make them wait two hours to fill a big plane, and then fly them to the next hub? Why can’t we fly point to point and give them 25 flights a day between Phoenix and Denver, and make it convenient for them?” That was questioning the unquestionable. When they bled to $143 in the bank and ready to close up shop, and Herb’s egalitarian spirit said, “We’re going to go toe-to-toe with these big carriers that got busted for antitrust violations.”
It was Continental, Braniff and Texas International that colluded to stomp on little Southwest. They had $143 in the bank. Herb said, “I’ll do all the pro bono legal work. Let’s go one more round with these guys in the courts.” They had three airplanes at the time and to keep the thing afloat, they figured out that they’d have to sell one airplane for a profit of about $750,000. It might give them another month. They went to their ground ops people and they said, “We sold the airplane, but we are going to maintain the same schedule with two aircraft that we did with three aircraft.” Everybody said, “How are we going to do that?” Herb said, “We don’t know, but we think you’re going to figure it out.”
What you’re going to have to do is figure out how to turn an airplane in ten minutes. That means from the time the airplane hits the ground, pulls into the gate, unloads, provisions, fuels, back out, airborne again in ten minutes. The average turn time in the airline industry at the time was 40 to 45 minutes. They said, “How are we going to do that?” Somebody came up with the brilliant idea of saying, “Let’s go study some things outside our industry.” If you were going to try to turn an airplane in ten minutes, where would you go?
I would think of fast-food restaurants and how quickly they can turn someone.
That’s not where they went, but that would be a great example because they’re doing something where they’re trying to move people in and out. They went to NASCAR. If you think about how races are won, whether you’re talking about Formula One NASCAR, where do they win, on the track or in the pits? They win in the pits. If that car pulls in, the driver hits his mark. If he’s over that marker behind, then the whole crew has to shift by 1 or 2 feet. That’s a tenth of a second. Pit races are won by tenths of seconds. If you get out of the pit in 6.2 seconds and I get out of the pit in 7 seconds, you’ve got a tremendous advantage.
What they did was they took that and said, “What happens if the minute that front wheel hits the chalk, the gates coming in, the provisioners are on their way with the truck that loads up, the fuel guys coming in and they’re like ants and gone again. They then were able to turn the plane in ten minutes. With security and all the things we have going on, that’s expanded to more or less to 40 minutes. If you think about it, the rest of the industry is way above that. That’s everybody being innovative. Innovation is everybody’s job.
Some keys there for the readers is to get out of your own industry. It’s not about best practices, it’s next practices. If you get out of your industry, that’s where you get some of the best ideas to give you a context and you question everything. My biggest influencers are P.T. Barnum and Walt Disney. They had nothing to do with sports, but they did some things dramatically different. When we questioned the thing of why fans pay for food, the way they’ve been paying for food forever. They come in $6 or $8 for this, we went on a Carnival Cruise Line. We took the whole staff on a Carnival Cruise and we said, “All your food’s covered, all your entertainment’s covered. Why aren’t they doing this in sports? We made every single ticket all-inclusive.
You don’t have to pay for your burgers, hotdogs, chicken sandwiches, soda and water. We questioned it and we believe it’s a better way. You question those things and there are many more things to question. I’m thinking to myself, “Why do people have a set seat always? Is that the future where they have a set seat or like in Disney World, do they want to move around and have freedom? What are those opportunities to see the game in different ways?” I think about that. I’d love to get your perspective because you and Jackie have done so much research standing on in sports. If you guys were running a sports team using some of your techniques, what are some things that you would do to either stand out, get out of the sea of sameness, disrupt or any things? You’ve worked so much with Bruce and The Giants. If you’re on your team now, what would you do?
You alluded to it. I would create way more variety. I would ask what are the 25 ways that someone could digest one game? I can digest it by going over here to this cubicle that’s sort of elite. Maybe I pay for it. Maybe it’s all-inclusive. I get to peer into what’s going on in the dugout. I get the closeup view of what’s going on in the dugout. In Major League, they wouldn’t do that because they don’t want to give away any secrets or something that’s going on in the dugout. In your case, who cares? Let those guys see what happens when the team’s down by five and they’re talking. What are they saying in there? What are they doing?
My bigger point is I would find a variety of ways for people to digest the game that is new and fresh. I love your idea about you’re going to come to a game, and you’re going to get to have four different seats and nine innings, or if it’s four innings if you take the game down to fewer innings, which I think is a great idea as well. Baseball is long. For the readers, please understand, I’m not caviler about people who have been hurt by COVID and lives that have been lost, but if there are any silver linings in COVID, it is that there are some gifts that come wrapped in an ugly package.
COVID is an ugly package, but if it does anything for baseball, for example, it may say, “The game is too long. Let’s shorten it. The season is too long. Let’s shorten it or let’s spread it out.” What if these guys played two months on three weeks off, two months on three weeks off? If you’re a player, you’re away from your family for six months of the year for all intents and purposes. My point is COVID has been an ugly thing for all of us, but what could we learn from it? What are the silver linings in it that come wrapped in an ugly package? It might be that, in your case, we take the game down from nine innings to 4.5 or 5 innings. We shorten it. We create more variety.
What would make people not want to have to go to the concession stand? I watch a baseball game, not in 2020 and everyone’s on their phones. They’re talking to people because there’s so much dead time. What would be an experience where you can’t not watch it? If you start asking those questions, what is so interesting about this time, the World Series is the lowest ratings in the history of the World Series. Yet, more people are home than they’ve ever been. If that does it with baseball, you better start doing something or you’re going to keep losing followers. Change, but they’ve had their multi-billion-dollar company. That’s one of the best things about Southwest. As they were growing, they were battling and fighting challenges in the beginning that they weren’t like, “This is the way we used to do it.” They were figuring it out as they go. That’s such a good advantage for smaller companies.
I wanted to spin off something you reminded me of that is important. Limitations don’t have to be limiting. Limitations can drive creativity. It was Marissa Mayer at Yahoo who said, “Creativity loves constraints.” In the early days of Southwest, they didn’t have the resources. They didn’t have the capital. They didn’t have the equipment. They had to find creative ways. In this time, this COVID hunkered down time that has constrained us all. If I were a CEO wanting to shake it up and go left on red, I would say, “What are the constraints drawing us to be more creative about? How can we take those constraints instead of bitching and moaning about them and going, ‘We can’t wait to get back to normal?’” I’ve got news for you. There is not going to be normal. The world has changed forever. How much we will go back to workspaces, collaborating and all is yet to be seen. It is not going to go back to the way we knew it before COVID. I think most people probably agree with that. How do we take this pandemic that has limited us in many ways and let those constraints drive creativity, and help us find the silver linings inside the ugly package?
I want to get into a rapid-fire in a little bit but before that, on that same point, I don’t think you used it as much in the book, Bochy Ball!, which was great. It was well done, but surround yourself with misfits. You were talking about the organization and the culture, but to bring creativity, surround yourself with misfits. In our first year, we had auditions at SCAD for performers. SCAD, the Savannah College of Art and Design are not sportspeople, by any means. We had these auditions. We had dancers, singers, improv artists and we just hire them. I’ll never forget this dancer that we had the idea, like, “Could he breakdance during the game? Could he be our break dancing first base coach?”Most people fear failure, rejection, and being alone more than they fear regret. Click To Tweet
He had never seen baseball. In the first inning, he ran out at the wrong time. He ran out there and the other team is hitting. We’re like, “No.” He went back out and I remember vividly where I was sitting. He started doing the moonwalk and dancing, not even knowing what was happening during the game. Fans and cameras started going up. People were going nuts. He learned how to adapt a little bit to baseball, but he came out with this outside influence that changed the game. How can you hire and surround yourself with misfits that didn’t come from your industry, come from outside and bring a completely different perspective?
You have to first get comfortable in your own skin and have the courage to say, “People who are different from me, even though they might be a pain in the ass to manage sometimes, and they might be eccentric, will add to the creative mixture of what we’re trying to do here.” That’s number one. Number two, if you look across the world, where are the hubs of fashion, influence and creativity? Where are the hubs that gathered the filmmakers, the fashion designers, the writers, and the crazy iconic Elon Musks of the world? They’re in places like London, LA, Chicago, New York. Why? They are cauldrons for misfits. You can be a misfit in New York City and nobody gives a rip. In fact, they value that because it’s a part of diversity. That diversity in those cities creates the cutting edge. It doesn’t matter what you’re talking about, fashion, film, business or science. San Francisco would be another one. There’s a lot of crazies in San Francisco.
We need to hire more crazies, but get comfortable in your own skin is a good point because it’s scary to hire someone that’s different than the way you are. There’s going to be a clash. There’s going to be conflict. We’ve had them. We brought people from the outside. You have to be able to get through that to see the bigger picture.
You have to expect there will be creative tension. As a leader, your job then is to manage that creative tension and not let it take you out. I think of my good friend, Bruce Bochy. Every year he’s got to take 25 guys that come from all over the world, different backgrounds, different upbringings, different languages and different politics. He’s got to get them to play as one. One of the things that he says because I’m privy to all this, he will sit down and spread training. A lot of managers who are spread training, talk about the way they’re going to run the team for the course of the year. Bruce does all that. Bruce focuses on the fundamentals of baseball and all that, but he spends a lot of time talking about culture, psychology and chemistry.
One of the things that he says is, “You guys are going to live in tight quarters for a lot of time. You can make your differences, become sandpaper that rubs you the wrong way and pisses you off or you can say those differences are going to make us stronger.” It’s a question of how you walk into the clubhouse. Do I walk in and say, “I’m working with this dude in a yellow tux and it isn’t my thing. What is it that I love about this guy that he can teach me and grow me and make me a better player or a better teammate? What can I do to do that?’” Bruce’s point here is don’t just show up and tolerate each other’s differences. Show up, celebrate, leverage and embrace each other’s differences. When you think about embracing something, Jackie and I have been married for many years. I love her more now than when we first got married.
I have embraced her. She is my life. She is my home. I have brought her in. Think about if you can do that in a business. It’s not the same as a marriage, but if you can say, “I’m not going to tolerate the differences between you and me. I am going to celebrate, leverage, and embrace them, bring them into who I am.” You’re still going to have to manage the creative tension. There’s still going to be issues because misfits were eccentric. You’re an eccentric guy. Let’s be candid. It’s the eccentric people that are changing the world.
I want to get to this rapid-fire, but I do want to do a quick debatable because we talk about bringing creative people in. There’s been a debate, I don’t know if you’ve read the new book by Reed Hastings, No Rules Rules, but it’s fascinating the different thinking that they have. They talk about higher salaries instead of performance bonuses. I know Southwest is big on lower salaries and give big bonuses. I see both if you’re trying to bring in great talent. What’s your thought on that? Between higher salaries versus higher performance bonuses, which way would you lean based on all the companies you’ve worked with?
Jackie and I cut our teeth on Southwest many years ago. That has stuck in my cross. You can probably predict where I’m going to go. What I want and what I think every business owner and CEO wants, I want people to think and act like owners of the business. I want them to treat each other, to treat customers, to treat processes. You said it earlier, never walk past a problem. If you see a problem, you own it. You may not have the skills or the authority or the resources to fix that problem, but owning it means, “We have a problem here that needs to be addressed. I’m going to go find the right people, resources, authority, political or whatever I need in this organization to fix that problem.” I’ll then hand it off. That’s not walking by a problem, but that’s also thinking like an owner of the business.
I’ve seen too much of a powerful asset in how many millionaires Southwest was created by making them owners of the business through stock options and profit-sharing. Profit-sharing is something you earn. You’re not entitled to that. That doesn’t just come. Maybe we’d have to say one size doesn’t fit all here. For some, bringing people in with higher salaries is a way to go. It’s worked for them. You can’t argue with that. My bigger question to you and myself and everyone would be, how do you create an ownership mentality? The simple analogy that you’ve probably overheard is when was the last time that you washed your rent-a-car before you returned it? Did you go put your car at last rent-a-car through a $725 detail before you turned it in? I’ll bet you take care of your own car. What’s the difference? It’s ownership. I suppose the question that could be asked between what Reed is doing and what Herb did is, how do you create that sense of ownership? I don’t think there’s a one size fits all.
We’ve tried a lot of things. We had our staff dictate their own salaries a few years ago. That was a good one-year experiment. We challenged it and we went to profit sharing. We are at that point, where we have a similar salary as all of them, but we know that if the team does well, we’ll have some more owner distributions. That pushes us to push the team. That’s thinking like an owner. Everyone wins that way, I’m more on that side, but I can understand attracting talent. If you have a higher base, you might attract them at first. It’s a good debate, but I lean towards you.
The other point is that it’s a little bit industry-driven. If we’re in the high-tech space or you’re in a scientifically-driven healthcare, or your Elon Musk who sends rockets to the moon and build batteries that will last 600 miles. Maybe you’ve got an argument to say, “We’ve got to have great talent to do that.” Southwest would like a pilot to have a 737 rating, be damn safe and be the best pilots in the world. Even there, they would say that when people have skin in the game, they’re going to think and act more like owners. It might be industry-driven a little bit.
I’ve been grilling you with questions for a little bit, Kevin. It’s going to be flip the script. You are now the host of the show and you can ask me one quick question.
What gave you the guts to go left on red?
Having to sell my house, me and Emily empty on our savings accounts, sleeping on an air bed and we’re down to our last dollar. When we first started, not being able to pay myself for three months. When you get those constraints, those limitations, those realities, you have to change. You have to alter. You have to do it. You also have to know, does it fire you up to do the same thing as everyone else? Does that get you out of work to say, “We are not going to be the same baseball teams as everyone else? We’re going to compete in the same game. We’re not going to do things differently.” For me, it was like, “Let’s try dramatically differently.” I love this left on red. You keep bringing this up. This is good, but as you know, you have to not be afraid of what can happen.
You have to believe so much in the bigger picture of what you’re doing. It’s such a big problem. There are many constraints. For us, we always start with, what are the problems? What are the friction points? If we get bored at a baseball game, if we hate getting nickel and dime, if we don’t want to be advertised to, if we don’t want shipping charges, if we don’t want all that, why do we do it towards our customers? That ends up being left on red because we’re not afraid to throw away short-term profits for long-term fans. That’s a big difference.
It’s also walk a mile in the shoes thinking. How do I think like a customer? How do I digest this game and this whole entertainment experience as a customer? If it doesn’t work for me, why am I going to force it on them? I love that. Jackie and I are spending a lot of time now in this whole area of, how do you help people become courageous and vulnerable? Those are two sides of the same coin. There is no courage without vulnerability, and there is no vulnerability without courage. Play that one out and think about it. You and Emily chose to do something courageous, but you had to be vulnerable to do it. You were vulnerable in doing it and executing, which required you to be courageous. Think about there’s the bigger thing here. My other question to you is, how do we help people not be fearless? I don’t think you’re ever fearless completely? Even Elon Musk is scared of things. I’ve seen his emotion on TV, but how do we help people fear less?Expect people to question the unquestionable and reward intelligent failure. Click To Tweet
I’ve been obsessed with small bets. You got to teach the idea of small bets. For me, even wearing this yellow tuxedo. I did it at our games. I wear first a black tuxedo, but I almost melted because it was 100 degrees that night. I went to yellow because it stood out with the colors and then I was comfortable at our games. People asked me to start speaking in it, being an emcee in it. That was a new step. I had to get deeper into the pool. When I started wearing it more regularly on every show, going through airports, back in the day, the looks that I would get. It was nerve-wracking, but because I took these small bets, this became more acceptable and more normal for me. What are the small bets that you can do something different and try?Expect people to question the unquestionable and reward intelligent failure.
We bought poker chips for our whole staff. We’re giving poker chips to every one of our people and they have to use their poker chips on different things to experiment. That bet was off, but we want to celebrate that and make it okay. The key is we have to do that first from the top. I’m fascinated by courage and vulnerability, but I always think it has to be small bets to get the courage to be able to take bigger bets, which then drives you more vulnerability back and forth.
I love that because there’s no growth inside the comfort zone. Small bets, one little bit at a time, expand that comfort zone.
We had players dance for the first time back in 2007. That was the only new thing we were doing because our fans started liking that, then we went further with a male cheerleading team and then the Banana Nanas, then the pep band. Because that one bet worked, we kept adding more things that people would say were different. Those are great questions, but if you want better answers in business, you have to ask better questions. You’ve been asking questions of the greatest companies for many years. You ask the questions yourself and Jackie. What are some other great questions you’re asking now?
I asked one of them, how do you create a courageous culture? How do you help people get over their fears? I’m threatening to write a book that would be a personal book called Fear Will F You Up. The reason I’m threatening that is because it has screwed me up in my life. I’ve pulled punches. There are books out there that are great books that I had the idea for that do not have my name on them. It’s because I didn’t have the courage. I pulled the punch. I’m going, “I don’t know if the market’s ready for that.” The demons of doubt set in. I’m 62 years old. I feel like I am more useful than I’ve ever been because of the mileage.
I’m going, “You pulled over so many mouse turds in your career that if you could go back and do it again, eliminate that fear, think of the traction you would have got.” I’m on this fear thing big time because most people fear failure, rejection, being alone, more than they fear regret. I don’t know about you, but when they put that thing in the ground at the end of the journey, I don’t know what they’re going to do with me because I don’t care much. Let’s say they put that thing in the ground. I don’t want them to carve on the tombstone, “Kevin Freiberg 1958-. He made budget.”
When I talk to CEOs that we work with, that’s a lonely position. You have Emily and I have Jackie and that’s a gift. It can also be the oyster too. I don’t know about your wife, but my wife is not bashful about telling me when she thinks I’m wrong. I get grounded through that process, but there are many CEOs that don’t feel like they can talk to their people. They go home and maybe their spouse doesn’t get what they do or the pressure they’re under in their jobs. One of my big questions is, who do you trust? How do you deal with the fear of doing big things of thinking big and acting bold? Where do you find the courage to question the unquestionable if you’re a real innovative company?
In a fear-based culture, I asked this question all the time. What is it about love in your business that scares the crap out of you? In other words, why is that a dirty word? Why is that a no-no to talk about? You got companies way beyond Southwest. I think of Whole Foods. They’ve done a great job of creating a meritocracy, but a family-like feel and giving people ownership. There are others out there. Even though we have these examples, still you don’t talk about that in business. Do you change who you are when you walk through the door of the ballpark? Do you need to change as a human being?
One of our greatest needs in life is the need to be accepted, to be loved and to belong to something bigger. What if we could create a business that was as human as the human beings in it? Those are the questions I’m asking executives because it pushes them out of their comfort zone immediately. They go, “Who is this kook? You don’t understand, I’ve got shareholders to respond to. I got a quarterly earning call that I got to be on.” I get it, but you want people to perform, to be innovative and to express their creativity, but you don’t treat them like people.
That book, Fear Will F You Up, that would be bigger than you even imagine because it goes through everybody every single day. It’s also a fear of what people will think. That’s one big thing that holds everyone back, especially with social media. Whatever you put out, you get that immediate reaction. Will people like it, will people not like it? That book is an important book that needs to be written. I want to finish with these final quick four. With that fear backdrop, if you could give one tip that a company or a leader could go back to their office and innovate now, a little technique, a trick, an idea, we may have touched upon it, but what would be that idea?
Make it safe. Expect people to question the unquestionable and reward intelligent failure. The keyword there is intelligent. When people try big things that are in keeping with the strategic intent of the business, the corporate values that are driving the business, and they try something that may be too early to market, or it didn’t have the right resources or whatever, but it had great intent, but it failed. We ought to reward the daylight side of them. How do you eliminate fear? You reward people who tried big things, even when it doesn’t work out. Make it safe for them to question things, to question the sacred cows, and the deeply embedded assumptions, and reward intelligence. It’s easy to reward success, but what if we reward failure? The intelligent failure is we don’t want to keep making the same mistakes over and over again, not learning from our failures.
Reward people overcoming fear, maybe that’s the first step. If you were to go back to yourself right before the Doctorate and start writing those papers and someone young, what was the best advice you would give for someone to stand out in business and in life?
Don’t be afraid to go left on red. If everybody is going this way, look the opposite ways. If everybody in your business is navel-gazing because this is what we do. We’re incestuous because of the industry. Look outside the industry. Some of our best ideas come from unexpected people and unfamiliar places. Don’t be afraid to go there.
Great leaders are repeaters so go left on red. You may get somewhere faster, but you may get an accident, but you’ll be okay.” I am fascinated with the idea of Going Bananas and for someone from the outside, I’d love to know what does Going Bananas mean to you?
It means you’re not afraid to step into the extreme. If I want to move culture to hear as a leader, I got to be out over here. I believe that if you’re trying to move people to this point, then you better exaggerate and be out of here. Herb would embellish stories. I know what he was doing when he told them. He was trying to bring people to this place. You’re doing that. You’re extreme in many of the things you’re doing and that’s maybe one of the highest compliments I could pay to you. You’re out there. How many people are thinking like you’re thinking? Don’t be afraid. You can work real hard at fitting in all your life and all you’re going to be is plain vanilla.
We want to stand out in a sea of sameness. You got to be extreme. Here’s the other thing, we wrote a book on this that is deep in my craft. Find a noble heroic cause that you believe in. If you can turn the business into a cause, in your case, you think about people come to the ballpark for two hours or whatever it’s ultimately going to be for you guys. It’s my respite. It’s a way to get away from the crazy life I lead. I could forget about things and be entertained, not only can I be entertained, I get to participate. I get to be a part of that entertainment in your organization. That’s a gift. That’s moving the needle in changing lives. When you turn a business into a cause, there isn’t an industry I can’t find that I could turn into a noble if you think about it long enough. What happens is the business becomes a movement. How many employees do you have?We want to stand out in a sea of sameness. Click To Tweet
We have 15 full-time and about 150 part-time.
You have 165 people when you’re full throttle. Wouldn’t it be cool if every one of those people said, “The Bananas are not a baseball team. They’re a movement. They’re a cause. When I’ve put my head on the pillow at the end of the day, I have a direct line of sight. Maybe I’m the guy at first base doing the moonwalk. Maybe I’m the person at the hotdog stand, but whatever it is I do, I have a direct line of sight between what I do individually and that noble cause that we fight for. There’s meaning. There’s significance in what I do and I feel good about it.”
I think you answered the last one which is, what makes someone unforgettable? It’s the worthy cause, the movement. You may have answered your last question. You and Jackie’s work has been unforgettable for us. It’s made a difference. At the time we needed it most, for the team to think differently, to see things, to have love, to bring fun into the workplace, even when times weren’t as fun, you made a huge impact on us. We are so much better because of it. Now we’re into Bochy Ball! We got CAUSE! and Nuts! We got all the books and we’re ready to learn more. I thank you for the impact that you and Jackie are making on the world.
You’re very kind. Thank you for taking it and doing something. To any author, to have somebody take your work, and then expand upon it, put their own thumbprint on it, and take it to a new level is music to your ears.
Thank you so much, Kevin.
Thanks for having me.
About Kevin Freiberg
Thirty years ago we learned you can not rest on yesterday’s headlines. For us, Ph.Ds were a beginning, not an end. And, riding the wave of an international bestselling book was a temporary pleasure. After three decades of writing and speaking, we have no interest in retiring.
We’d just like to keep growing and make a bigger contribution helping people like you do epic work and live epic lives.
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