SWA plan for 15% ROIC

[PCL_128]

Wise managers know that the two obligations are closely related.

Yes, but that calculation is also a bean counter's calculation. It all ultimately comes down to counting beans, not to "LUV." No CEO of a publicly traded corporation has ever made a decisions just because he "loves" you.

 

[HowardBorden]

But it's a mistake to believe that he makes decisions based on his love for the average worker bee. It's delusional. Primarily because he has a fiduciary obligation to his shareholders, so he's required by law to think of them first. No matter what he says, the shareholders are first, and the employees are a distant second.

I absolutely agree that shareholders come first, but where you lose comprehension of how SWA operates is the link between how employees are treated and managed and in turn shareholder profits. So when you state that love for individual worker bee is delusional I can agree, but what you are missing is the bigger picture that fiduciary responsibility to shareholders ultimately begins by treating employees right and developing a strong culture. Many here state that SWA culture is dead or dying, but most don't actually work there. As someone who does actually work there, I will submit that on its worst day Southwest company culture far exceeds most airlines on their best day.

http://articles.washingtonpost.com/2012-04-03/business/35453344_1_culture-core-values-customers

A consciously developed customer-centered culture is a business advantage that will serve you for years — and inoculate you against competitive inroads. Consider for a minute Southwest Airlines and the lengthy list of would-be category killers that have tried to imitate it: United Airlines’ United Shuttle, Continental Airlines’ Continental Lite, Delta’s Delta Express and US Airways’ Metro-Jet.

What did these companies lack: Money? Name recognition? Hardly. They lacked Southwest’s relentless focus on culture, which none of its pop-up competitors was willing to slow down to emulate. And all are now bust.

This is why someone leading a business today — preparing a bright future for your organization and perhaps for the world — needs to focus not just on nuts and bolts, techniques and standards, but on culture.

Without a consciously created culture, your leadership won’t last beyond the moment you leave the building. Any vacation — or even lunch break — you take is an invitation for disaster: The inevitable complaint I hear from consulting clients and at my engagements as a speaker is this: “Employees act differently when there aren’t any managers around.” But with a great company culture, employees will be motivated, regardless of management’s presence or absence.

 

[redflyer65]

Plus the fact that Southwest employees own HUNDREDS of millions of shares in LUV stock.


....we are the shareholders, as well as the stakeholders.

 

[jonjuan]

Plus the fact that Southwest employees own HUNDREDS of millions of shares in LUV stock.


....we are the shareholders, as well as the stakeholders.

No different than any other company.

 

[redflyer65]

No different than any other company.

Completely disagree. I'd say more SW employees have a stake in the company than most others. Especially when it comes to US airlines.

 

[dicko]

Completely disagree. I'd say more SW employees have a stake in the company than most others. Especially when it comes to US airlines.

Prove it.

 

[PropPiedmont]

prove it.

espp.

 

[redflyer65]

http://esoppartners.com/blog/bid/89137/Southwest-Airlines-Employee-Ownership-Culture

Article is a little dated at 3 years old. But at 15% employee ownership, that's more than the largest institutional investor which is Primecap.

Total employee ownership is around the 115 million shares. How was the Airtran employee stock ownership before it was sold?

From the article....



We recently mentioned Southwest Airlines when discussing a Different Way to Quantify Your Ownership Culture. http://rady.ucsd.edu/beyster/newsletter/southwest.htmlSouthwest Airlines President Emeritus Colleen Barrett on the Power of an Ownership Culture discusses how employee ownership, Open-Book Management, and an ownership culture built on trust have contributed to the success of Southwest Airlines:
At any given time, 13 to 15 percent of Southwest's stock is owned by its employees through a profit-sharing plan with the option to purchase additional stock. "Employees feel like owners because they are owners," says Colleen. "Ownership is one of the things our employees are most proud of. How can you expect people to have passion and excitement for what they do if they're not owners? We've had flight attendants and mechanics leave Southwest as millionaires."

"Everything is negotiated," says Colleen. "We give employees the opportunity to criticize and question us. Southwest doesn't often need to conduct surveys or hire consultants to determine what we are doing wrong or well. The employees tell us face-to-face year-round. We have open books, we're transparent and we're all-inclusive in telling employees what's happening.

 

[Luv2BFlyin]

speaking of surveys, were the full results of the last company wide survey ever posted anywhere?

 

[Roomwithaview]

Yes

speaking of surveys, were the full results of the last company wide survey ever posted anywhere?

Right here!

www.youtube.com/watch?v=OhohteHuyPM

 

[dicko]

I'd say more SW employees have a stake in the company than most others. Especially when it comes to US airlines.

You didn't address or prove prove any of the above contentions.

Regarding AirtTran stock. As a new hire I was given stock. I sold it when the stock more than doubled. My earnings were massive. I am a genius















before tax profit was less than $400

 

[redflyer65]

You didn't address or prove prove any of the above contentions.

Regarding AirtTran stock. As a new hire I was given stock. I sold it when the stock more than doubled. My earnings were massive. I am a genius















before tax profit was less than $400

Awesome move.

Did Airtran have a employee stock purchase plan?

 

[dicko]

Awesome move.

Did Airtran have a employee stock purchase plan?

Thanks. I'm also able to alter the outcome of horse races by betting. The horse I bet on will die from Ebola seconds after I put money down.

No idea about AirTran ESOP. I don't buy airline stock. It's best for all of us.

 

[maxblast72]

Yes, AirTran had an ESPP as well with a 10% discount. I accumulated $100/paycheck for 4 years and did quite well when Gary Kelly offered a 70% premium to the September 24, 2010 AAI closing price. Wish I had manned up and bought $500/paycheck for 4 years

I seriously doubt 15% of all outstanding AAI stock was owned by employees (although Fornaro, Leonard, and the other AirTran senior executives and board members definitely had their share).

 

[maxblast72]

Many good points discussion here. My $100 Million was based on 5th year F/O pay at 90 TFP per month +15 percent for benefits. I re ran it and it came up to $99 Million. I understand the seasonal swings in our manning here. I think we are slightly overmanned in Sept and Oct as well since almost no one flys on F/O reserve. I don't see any Capt downgrades coming because we are not upgrading at nearly the same rate that we are bringing people over the partition. The 10.2 number I stated was given to me by a captain. Maybe the number really is 10.8. The issue is that a small change in the manning model number per aircraft or number of aircraft radically changes the date of when the break even point is with retirements. If the number really is 10.8 and we stay at 700 aircraft we most likely Won't furlough. That being said if the number is becomes 10.2 or 10.5 OR we end up with fewer airframes the math changes to where a furlough looks much more likely. The things that concern me are 1. That there is no commitment for replacement aircraft for retiring 300s. 2. That there are so many AAI pilots not flying not just seasonally but anually.

Get your calculator GhettoBeechJet. You may need to do some recalculating soon.

http://www.reuters.com/article/2013...1?feedType=RSS&feedName=innovationNews&rpc=43