The Southwest Airlines Rule That Built Unbreakable Employee Loyalty with Chris Dyer

What types of things would you make sure that you did on day one? And what are some of the tools that you would have in the toolkit to be able to make sure that like the company was set up to go from the Scrum to the organization?

Yeah. So I'd be very clear about what I want from that culture. What kind of culture do we want to have? And really being clear on what that is, like people like us do things like this. You can answer that question, cuz that's different, right? Think about Amazon, like how they operate. It's very different than Google. It's very different than, you know, Meta or any of those other companies, but yet they're successful, but they have very different ways in which they operate. You know, be very clear about who you are, cuz that makes it easier to deal with the things that you were mentioning, right? As you get those layers, as you start adding in management, if we're very clear on who we are and what we do, it's easier for the managers to take that persona on, for them to be able to, right? Because otherwise they just start doing it their way and that's where it gets murky because now like, well, I worked with the boss, I worked with the leader all this time and I know how he or she wants me to do it. Now you're telling me something else and like that, right? You feel totally dis— discombobulated. Go ahead.

Okay. So like when you say you need to know who you are, is that the leader founder? Or is that the business? Is that the collective you, collective we?

Well, both, cuz especially if I'm starting a company, the company is me at that level as the founder. Whatever the things I believe and my little intricacies and my things I'm fascinated about and how I treat people, that is the culture from like 0 to 25. Yes. Because you're just so ingrained in interacting with all those people. Now that's gonna become more sophisticated as you grow. But the culture is the founder and, and so many, and there are exceptions, but like, you can just feel it. Yes. If I'm a, if I'm a grumpy results-oriented person only, and I don't care about like, you know, what you did on this week, the week, you can feel that because we're small enough for that to be important. As it grows and those layers come into play, that changes, right? It maybe it might be a little bit more about how my new boss is acting, right? Right? That might feel a little bit that way. So, so it's interesting correlation that as the company grows, how you feel about your team is how you feel about the company, and how you feel about your boss is how you feel about the CEO. When, when we're doing surveys and rankings and things like that, that as that beca— you know, you start to pull away from the culture and pull away from the CEO or founder, who, who you deal with every single day is kind of how you think about That's like your, that's your, you know, your reality, even though that's not necessarily true. That's your reality as an employee.

Yeah. It's the, it's the reality of proximity. My experiences define my experiences and my experiences, lived experiences every day are the people that I'm engaged with. And actually whatever happens over in that department or that department, I don't, I never see it. Can't see it from my front porch. So it, it doesn't really impact you. So, you know, this concept of building teams within a company has been powerful. I wanna get your opinion on something. So when I coach our franchise owners, we have a set of values and it's CARES: community, accountability, respect, excellence, and servant's heart. So it says CARES. And what I've found in building businesses that those overarching values govern the relationships with how we wanna show up, how we wanna execute, what's important to us. And, but I also find that they're somewhat incomplete. As I looked at your 7 pillars, you know, which get very specific, I'm like, okay, You know, is, you know, your 7 pillars are action-oriented. You can act— listening, right? Okay. You can actively listen. I encourage our owners to— that the CARES values need to be up top, but I, but you should build a business that's authentic to you for your attracting and your retaining, not only for your employees, but all stakeholders, subcontractors, referral partners, you know, your culture and how, what they can expect from your company. Needs to be defined and you need to be able to articulate it in a 30-second, 3-minute, or 15-minute interaction. So if you wanna build a faith-based business and you wanna have 7 principles, God bless you. If you wanna build a, a, a veterans-based business, if you wanna build a business that cares about pets and animals or things like that, what's authentic to you inside of, you know, that you're who, you know, how you, what you believe is important. And what's gonna define the organization. Now, within region, reason, right? If you're in a home service business, well, we have a fencing business, so pets have a lot to do with fencing actually. But I mean, you know, your, your values and your principles need to be aligned with the business that you're in, with the communities within which you're going to operate. But they also need to be authentic to that owner because you can only be somebody you're not for so long. So do you, at the startup phase, do you, I mean, you've obviously, you work for big companies, like you work with the biggest companies and you have thousands of people and, you know, you can operate in that environment. But like for these startup owners, what tools do you have for them as they're just for the first time thinking about their values, their principles, and the environment, the foundation that they wanna lay out to welcome the first people into?

Yeah, I mean, go sit on a rock and think about, you know, what is that best company, the best boss, the best environment that you want to create. Right? So take the time to think strategically. And what I find fascinating is that most people don't think deeply about much, right? They might think really deeply about like that product or that thing. I'm gonna go sell a dog leash and they think really deeply about that and the client, all that. And then they go, okay, I'm gonna hire some people. And like, they're not thinking really deeply about how are we gonna operate and how are we gonna make this business work for people? And how are these people going to come into this business and be happy and serve the business in a way that makes sense? And like, they don't think about that deeply, and it's probably because they don't know, right? We haven't been taught that. This isn't something you get taught in business school. It isn't something you learn inherently. And so my framework works for startups, it works for Fortune 100s, and it's, you know, you look at those 7 things and you gotta figure out how to implement them in a way. That makes sense for you. And you're right, they're very action-oriented because what I find is if you did think deeply and you did say, I'm, I have this really clear plan of who I want this comp— what I want this company to be, that's day 1. And by day 50, you've, you're so focused on selling dog leashes that you're not even thinking about that anymore. Right. And, and you start to lose that momentum and you lose that feeling and you, then you start hiring people that are not in alignment with what you said was important. And that's how you end up with a really crappy employee or, you know, someone who's not serving your business is unaligned. So your question was, is what tools? So I have found that there are some really specific things that you need to do to really make sure this is helping your business and that you're thinking about it. Number 1 is your meetings. Your meetings are a direct reflection of your culture. So if you are making people come to the same boring 30-minute meeting over and over and over again, without a proper agenda, without a different focus, you're generically asking them to show up and just on, you know, on the spur of the moment, be magical for you. You are doing them a disservice. CEOs, founders, it's hard for them to understand, but I had to remind them. Not everyone thinks like you. Not everyone thinks as fast as you. Not everyone thinks as deeply as you. Not everyone is as smart as you. Not everyone has had the same experiences as you. Or they would go start their own company. Now that's a little harsh to say, but that is the reality. There are people that are going to go out on a limb, start their own company. Maybe they have the money, the access, they have the idea, whatever. Most people show up to work for somebody else. And so how do we help those people be incredible? And it's through our meetings. And so we found that we would name our meetings very different things so that it told the employee exactly what was going to happen, how long the meeting was going to be, what their role is, what they were supposed to do in that meeting so they could show up and be incredible. Give you a good example, a cockroach meeting. Cockroach meeting is a 15-minute meeting or less. We start on time. We never go over 15 minutes. I would use the example, there's a cockroach in your bathroom. It's a small problem. You may not wanna be the one who cleans it up, but like you go get the cockroach, you throw it away, you flush it down the toilet, the problem's over.

It's quick. Yeah. Who brings the pointy shoe?

Right, right. Who brings the pointy shoe? Who brings the tissue? Like who's gonna deal with the thing? But it's one issue. Now you might go in there and clean up the cockroach and find out you got 50 in the cupboards. Now we have a new problem. That's a, that's something else. That meeting, anybody could call a cockroach meeting and you could invite anybody you want, no matter how big. I had 4,500 people in our ecosystem. My, when I sold my last, you know, big company, anybody could invite anybody. Now, it's optional for me to, if you're inviting me, it's optional for me to attend and it's optional for me to, you know, I can say yes, I can say no. But if you think inviting the CEO and the CTO and the CMO is the right call, go for it. They might say no if they don't think they're the right person to be on there, or they're busy, or they can't do it, or whatever. But like, what we found is that people spend so much time picking up the phone and hanging up, pick up the phone, hang up, or walking around the office and asking people questions one at a time. And so information moved very slowly, and it took them a really long time to get their answer. This is magnified in remote and hybrid work, or if your workforce is sort of spread across the country or the world. And then they were stuck having to wait to talk to their boss on their weekly meeting or wait to talk to their team on their weekly meeting. And so their answer, they might go an entire week and not get their answer. And if their boss cancels or the team meeting gets pushed, they might go 2 weeks. Do you know how incredibly frustrating that is? You know how that just kills your business? That someone can't get an answer to their question, can't get their problem solved without someone else or a boss or somebody like that. So that is a culture killer in my, in my opinion. We've seen that again and again and again. Frustration, can't get my problem solved, that turns me into a lazy employee who doesn't care, who's totally apathetic because you've trained me to do it that way. You've trained me that the organization doesn't care about solving my problem, and we don't care about getting things done quickly. And so I'm just going to sit back here and wait. I'm going to collect my paycheck and wait because you've told me I'm not important. So we shift that meeting into, I can get my answer. I can invite 5 to 7 people. I can get my answer. You know, I call the meeting for an hour from now. I can get my call, my meeting, and I can figure that out. At least I can get something. Hey, you know what? We don't know the answer, but Jason does. I know Jason had that problem last year. Go talk to him. He's the right person, right? And I can get unstuck and get things moving and feel good that I'm being productive in the, in the organization.

Negative progress or no progress are the greatest dissatisfactors in life. You just, you're spinning your wheels. Okay, I'm getting paid, but I'm not being fulfilled. And everything's a hassle and everything's friction. And if I want some recognition, I want some positivity, I'm not gonna get it because I'm not getting things done. And at the end of the day, uh, you know, I, uh, I'm not accomplishing my goals. I do have a specific question about one of your 7 core pillars, and it's acknowledgement. How does acknowledgement help foster, uh, a positive culture?

Recognition and acknowledgement is everything, right? So acknowledging that person, we're acknowledging our clients, but whoever we're Whatever we're doing that for, we're finding ways. And, and in the book I give you two very different, uh, courses of action. I think in most businesses, especially in startups, it's just about saying thank you. Now, whether you put their name up on a board or whether you say thank you in Slack or on Teams, maybe you call a quick meeting. Uh, again, I think if you do it on email or Slack, that works the best for your extroverts and your introverts. Right? Someone who's really introverted and you call a team meeting and you pull them up in front of everybody, you're actually not making their day. You're making it worse. So doing it in a place that's, you know, where everyone is going to be happy is great. But just that thank you. Right? And if you can, it's really hard to do if you've got 5 people, but if you've got 25 or 20 people, you can start. It really should be owned by your employees. Employees should be the one driving recognition. They should be noticing somebody, hey, I just, I was on a call with Bob and we were doing this, talking to this client, and he came up with the most amazing solution. And you put that into Slack and like, Bob did the most amazing thing. We, we had this little emoji called, it was a green flag. We were like, green flag, way to go. And that was our, our little thing, a green flag. But it was just a thank you. We want to have that in there. Are we calling people out? You know, if you wanna think about, if you're a very sales-driven organization, do you have a President's Club? Are you calling people out for being your top salespeople? If you're a customer service-driven company, are you calling your top customer service people out? Are you giving them bonuses or vacations or whatever it is that motivates them? You gotta figure that out. But if you say you are a thing, are you doing something to really show everyone you really care about that? Through your actions and, and measure— measurement's one of my pillars too. Are you measuring that? Right? I can't tell you how many times that people say, oh, we're a customer service-based organization. Cool. What do you do to measure customer service scores? And like, um, you know, we're just the best. Our customers are really happy. And I'm like, hmm. So you're not doing a survey, so you're not checking in. You're not— you, that's just a, you believe it, but that doesn't make it true. You have to be really focused on how do you say thank you and how do you acknowledge not just your employees, but your clients, your vendors, everyone in your your atmosphere?

I've coached 30 seasons of my kids' sports, and I wrote a book called Hey Coach, and within that book, I called out the importance of unique language and stories. And I still talk about that unique language, you know, naming certain things. Any kind of club that you've ever been a part of has a secret handshake or something that they call it here that they don't call it anywhere else. And I've heard it just in this first 20 minutes. I have heard green flag. I've heard cockroach meeting. I've heard all of these things that I've never heard anywhere else before. And that these— so, but like, that makes a culture special. Like, this is us, this is ours. And I, and I actually had overlooked, but I see that uniqueness is one of your 7 core pillars of, of cultural. And I, I talk about that all the time. I said, you've got it. You create a unique language, and then your culture is an organization's memory. It's going to live in the stories, and you need to make sure that the right stories stay alive inside of it. What are some other things that you do intentionally to create uniqueness in your workplace?

So what you're referring to is tribal speak, and we can look at some of the best organizations in the world. I was just at Disneyland yesterday. They have an entire language. Cast members backstage. I mean, they have this language, right? Walmart has 900-letter acronyms for everything, and I think it's the most ridiculous thing I've ever seen, but it is a very specific language and it is their thing. And they obviously are wildly successful. Having that is so important. I'm glad that you called that out, and it can be anything. Take my cockroach meeting and rename it something else. I don't care, right? Just make it something special, and your people really will love doing that stuff. When we think about uniqueness though, it's about celebrating each individual person or each team or each department about what makes them successful. So there's lots of lenses here. There's the lens of what makes you unique as like my top salesperson? Like what, what is it about you that you're doing? What are your practices? Who are you? You know, where are you? Like, how are you doing that? And getting really curious about that. It's also about you, you have a whole team of people and it's really easy to like say, well, what do we all have in common? What do we all like to do? And, and what you end up doing is some of the people end up— that you're right about that, there is a lot of commonality, but you end up excluding certain people who don't have those same values, don't have those same experiences, don't come from the same upbringing or whatever. And so I know this is a hot button topic, but that's sort of like my way of doing inclusion, right? About getting— how do we bring in the right people and be able to ensure that we are really curious about what makes them special and them uniquely good for our business. And so if I'm overly focused on, oh, we all like tacos and we all like pizza, and I don't ever ask anybody else what they like to eat, I don't, I don't learn anything new and I don't get exposed to any new ideas because, well, we all like pizza, we all like tacos. That's what we'll have at all of our meetings and all of our lunchtime. We all like the same thing, right? And it's, that's just sort of a cognitive bias for us to get trapped into Where are we the same? As opposed to, well, how are we different? And why is that cool? Like quick, really quick example. I, we did the StrengthsFinders, the Gallup StrengthsFinders. We, that was always a constant thing we did. Any new employee that came in, we had them do their top 5. I highly recommend any business, no matter what your size is, to do that. Now, when we got big enough, what we did is we took all that data and we measured it and we put it. A little tally mark in each one of the strengths. I think it was like 34 strengths. And out of thousands of people, what we realized was that we had strengths where we had nobody or almost nobody. So we were hiring the same kind of people over and over and over again. And then I'm saying, as a CEO, we need fresh ideas. We need people to think out of the box. We need innovation, but I'm hiring the same person. With the same values or thinks the same way because someone has said, well, that's predictable. I know I can get out of that person. If I hire that kind of person, I know what I can get. And so what I told everyone was, I don't want anyone to do a final interview unless that person has in their top 1 or 2, one of those strengths that we don't have or we have very little. Wow, did I start getting different people in the interview.

Right.

I didn't ask them to hire more men, more women, more of this, more of that. I didn't do any of that. I just said, I want people who think differently, and this is how we're measuring it concretely. Go find me different people who think differently. And that was really important for our business at that point when we were kind of doing our next doubling of employees. And that was a lot of people, um, to really get people who matched into the places where we were really weak.

Was it long enough ago? To know whether it was a positive.

Oh yeah, absolutely. Absolutely. We, we saw that we kept our cultural identity as we grew. We saw that that was a multiplier. And, you know, we started getting people who could help us in ways with things that we hadn't ever tackled. Right. To start growing that way, you need different types of people who think differently or have different skill sets. Also, we would suddenly be like, well, we need a lot more sales help right now. And we could easily shift people because they had different types of experiences. We could say, hey, we were thinking about adding, you know, 10 more of this type of people. Does anyone in the company interested in that? And people would raise their hands and we look at their resume and be like, you're in customer service. I had no, I didn't know you had done sales for 15 years. Right. And I was like, you're perfect for this role, you know, and, and so it allowed us that kind of the variety of people, uh, in the organization with very different skill sets as opposed to hiring that same generic person over and over and over again.

What was the impact on innovation and what was the impact on conflict?

Um, we certainly felt like innovation, we, there, there is this strong belief that you have to have innovation separated from the organization, especially as a large organization. In order for it to actually occur. We see big companies do this all the time. Pull them out, they put them in a separate building, they have different rules, they're not, so they're not sort of stuck in the dogma. Kodak knew about digital film. They knew all about it. They understood it. They were working on it, but they couldn't get away from the cash cow. Right? It wasn't that they didn't know. A lot of people think they didn't know. No, they knew. They just couldn't get away from the cash cow. Same thing with Blockbuster. They knew all about streaming, they understood it, they just couldn't stop selling and get out of their business model. And so when you remove innovation out, you can, you can start another company to start to, to test, you can do something different and then integrate it back in later. We never felt like we had to do that because we felt like innovation was strong. I will say we had a software partner though. That was separate and they did do separate innovation that was really helpful to us. So we kind of had like the best of both worlds. I felt like we had really good innovation internally with things. We also had a great partner who was doing their own software innovation that we didn't have to even think about. And so as they got better, we got better. You said on conflict. Yes. Listen, I mean, I felt like we did a good job of dealing with conflict. But I don't know, I'm not sure anyone is ever completely satisfied with how you deal with conflict. You have human beings and you have people that disagree. With as many people as I had, I had the full spectrum of political views and how we should do things. And so there was always some conflict, um, that we had to deal with, but we tried to center it back to our culture, our values, who we are, what we believe as the most important thing. For the business and everything else had to fall in line under that. So if you believe this thing over here politically or socially or whatever, that's, that's, that's fine. But like, does it fit? This is what we're trying to do. This is who we say we are. If you don't feel aligned, that, that's okay. Go find another job. We'll, we'll root for you from the sidelines. But we had to be very clear about who we were in order for that to work. But I, felt like it fostered better conversations. One of the things, one of those meetings that I did was called a tsunami planning meeting. And so what we did is once a month we got our teams together, um, and they had to have a fake meeting. Now, people are always surprised that I would call a meeting that isn't, that we don't even need, right? It's like, but it was once a month. We gave them a topic and it was a, what would happen if? Really big. What happened if a tsunami, right, hit the coast? Like, that would be a big event. What would happen if the CEO went into a coma? What would happen if we lost half our business? What would happen if we doubled our business in a month? What would happen if? And we got these great ideas. That's where innovation started because we were asking them to think in an innovative way, but there was no pressure because it's not a real thing. We're not asking to come up with a real answer right now. No one's going to get told they're going to be put in charge of it now, just because you came up with an idea. We're not going to be like, oh, Jeff, that's a great idea. Guess what? That's now your new thing, right? You're going to have to go do 40 more hours a week on that idea. Like, we're not— because people would be cautious about saying things in meetings because they might have to do it. They might have to take that on or, you know, add that responsibility to their plate. But most importantly, we got innovation. We got cool things out of that meeting. But the best thing we got out of that meeting was that it was a chance for the manager to sit back and watch their employees have a conversation and have a meeting for 30 minutes about this thing and realize who was screwing up your meetings all, all month long. Because maybe Dave won't shut up and Dave keeps talking over everybody and you're like, cause if he's doing it in that meeting and guess what? He's doing it in all the other meetings too, all month long. Or maybe Sally is not, not talking. She's not getting her voice heard. She's not raising her hand. She's letting all the other people talk over her and she's just sitting there quietly. Those are two very different things you need to be worried about as a manager, but you better go deal with that. We need to go tell Dave to tone it down. We got to tell Sally to, you know, we want to hear from her. We hired her for a reason. She's a smart person. I want to hear from you. Right. And all these other like bizarre personality, bad conflict, people cutting people off, being passive-aggressive. Like that was the meeting that the manager could then go back and meet with those people that she did, he or she needed to meet with and coach them on how do people like us do meetings? How do we do all of that? And that helped us eliminate so much conflict over time because we were pre-coaching them to the behaviors that we wanted.

What's the difference between a mistake and an error?

So an error is I'm not trained properly. I don't care. I haven't slept in 3 days. So let's just say I'm a nurse and I've given the wrong medication to the entire floor. Was it because I don't care? Was it because I have worked 3— 72 hours straight with no sleep and I can't even like think straight? Like, Those things are errors. Okay. And errors should not be tolerated. That we don't allow errors. Errors are not cool, right? That's what, that's when safety things happen. People get hurt. We do things that are going to get us sued, all of that. Mistakes are, I was trying to do the right thing. I thought I was doing the right thing and I tried something new, or I tried the thing I thought I was supposed to do. And it didn't work, but my intentions were pure. My intentions were correct. Great example. I mean, Southwest Airlines has gone through a lot and I don't know if they're the same organization anymore, but you know, 10, 15 years ago, if an employee did something that they thought was the right thing, Southwest Airlines would never criticize them publicly. They would always back up that employee publicly. In the news, and it didn't matter what it was. If that employee was like, I made this change, or I did this thing because I really thought this was the right thing to do in that moment, based on everything going on and my training, I thought this was the right thing. And Southwest Airlines might say privately to that employee, well, next time, this is how we want you to deal with it. We have a little different way we want you to think about this. But publicly, they would say, we back the employee. They made that choice. That was the right choice at the right time. And so that's a mistake, and mistakes we can learn from. We can figure out how to get better. We can go try something and say it didn't work and come back and tell the entire team, guess what? We made this change in the software and guess what? Everyone hated it. It was the wrong thing. We're going to change it back. We're going to come up with a new solution. We want mistakes to be prevalent and to come up to the surface and to have, have sunlight on them. Because if people are hiding from mistakes. We can't get better. We can't— our organization will never thrive. We will never have people brave enough to try new things and to create innovation, or to even just admit that, hey, I did something and this isn't right and we gotta fix it before it, it turns into something else bigger. So really understanding the difference. When, when, when do you put your foot down and say, this is not acceptable? And when do you say, thank you for trying that. Thank you for totally screwing up. That's amazing. Let's go tell everyone what happened and let's figure out how to do it better next time.