The Southwest debacle is a direct result of our flawed economic system that rewards the shareholder and executives at the customers’ expense.
Southwest fail
Our economy is populated by various stakeholders that include employees, employers, consumers, shareholders, and executives, among others. The Southwest Airlines cataclysm is the result of an economy that does not guarantee equity among stakeholders.
Many Americans lost their Christmas. Some lost their last chance to see relatives that are unlikely to be with us another year. That is not something that can be recovered. While no company can control the weather, the climate is one of the factors an airline must take into account. They must have mitigating procedures for said disruptions.
Southwest had a failed model. But the model failed because of its financial irresponsibility.
The Washington Post reported the following.
Southwest Airlines’ pilot and flight attendant unions warned for years that the company’s rickety computer systems left the airline vulnerable. The carrier stuck with outdated technology and never heeded those warnings, they say.
Southwest’s overwhelmed technology — a scenario fueled by a punishing winter storm — left it this week facing some of the most difficult days in its half-century history, in some cases forcing managers to solve problems with pen and paper while crew members waited on hold for hours with schedulers. …
The Southwest Airlines Pilots Association said Wednesday the collapse of the airline’s operations was avoidable, noting it has warned for years about the company’s unwillingness to modernize its operations. Company officials acknowledge current problems stem, in part, from an inability of internal logistics and scheduling systems to recover after widespread storm disruptions.
“For more than a decade, leadership shortcomings in adapting, innovating, and safeguarding our operations have led to repeated system disruptions, countless disappointed passengers, and millions in lost profits,” the union said in a statement.
The Transport Workers Union, whose Local 556 represents flight attendants at Southwest, likewise said on Twitter on Wednesday that the meltdown was avoidable, and said that the airline should have invested in passengers and workers, rather than paying dividends to shareholders.
In other words, Southwest Airlines was biased toward its shareholders and executive instead of investing in the tools to ensure its customers and employees had experiences commensurate with their value to the company. This is one of the many flaws in our economic system. Some will say that the companies like Southwest will pay in the form of lost customers or profits. The flaw is that stakeholders, like customers, often pay without the capability of recompense.