YouSaid · the spoken record

Herb Kelleher

lines on the record: 22
first: 2019-01-22
most recent: 2019-01-22
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Keller once brought a 300-page history of Richmond, Virginia, and read it before speaking there as at a symposium for CEOs. I love this. He ends up having a dinner at some old-time Virginian's home talking about the history of Richmond. They're going around the city, and Herb is pointing out where battleworks were set up and other places of historical importance. I don't know where he finds the time. He didn't do it to show off. He did it because he was going to a new place and he loves history. So that's the benefits of curiosity and how they are unpredictable. There's something that I've read on Twitter the other day that I've been really trying to think about in general. And it's a double entendre. And it's just a good mantra for your life. And it's three words. Avoid boring people.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“Know LF myself is the benefits of curiosity are unpredictable. And I'll close on this. Keller is a student of life and a voracious reader who digs deeply into issues to understand them thoroughly. It is not unlike him to go on a book buying binge and spend four or five hundred dollars at his favorite bookstore. When his son David was studying physics in college, Keller started reading up on the subject so the two of them could converse.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“The example Her gave us where you have this airport that no one's even paying attention to and it's a gold mine. Why is it a gold mine? Because it's closer to downtown where my business travelers are going and nobody's using it. These people don't even understand anything other than the tons of money that the advertisers are giving them to make a worse listening experience. Okay, so I'm going to hop off my soapbox because that's not what you're here for. But as I'm going through these books and reading these things, these random thoughts pop into my mind and I just have to be, I try to be authentic as possible and tell you what's going on or at least my opinion on it. Okay. Random quote, which I love about Herb Keller is he just made work, you know, he had a good time. You could tell that from his drinking whiskey every day, which obviously don't advocate. Life is too short and too hard and too serious not to be humorous about it. That's a great quote for him.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“So something that he talks about in the book, but I've also heard him speak about is that a lot of the decision makers by CEOs and founders has to do ego and empire building, not the actual smart It's not actually good for their business. It's good for how they feel about themselves to make them feel like they're so special and important. Herb was the opposite of that. They talk about on the busiest flying day of the year, which I think was either the day before the day before Thanksgiving, whatever that day was, I'm pretty sure it's the day before Thanksgiving. Her would show up. I forgot which airport it was. The airport closest to the headquarters Southwest and he'd do the luggage all day long. He'd help customers with luggage. Do you have the CEO at this time of a hugely profitable airline and he's out there helping you with your bags? He did not think he was better than these other people. And that's why he's like, I don't care if I don't fly internationally. I don't care if I don't have the biggest, newest technology and the biggest plane so I can.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“And this is Herb on knowing what you do best. We must not let success breed complacency. Cockiness, greediness, laziness, indifference, preoccupation with non essentials, bureaucracy, hierarchy, quarrels, or obliviousness to threats posed by the outside world. We don't care whether we fly to Paris. We don't care whether we have a 747. What we're focused on is being profitable and job secure. If people didn't pay much attention to Southwest Airlines because it appeared to be a much smaller regional carrier, it was just immaterial to us. We set ourselves up to go into a specific niche in the airline business. So we're saying that we know what we're good at. Stop worrying about what everybody else is doing. Yeah, the 747 is a brand new, beautiful plane. It doesn't matter.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“This is a ticket in Capital Big Bold Red Letters on the receipt instead of spending two million dollars to follow the rest of the industry. Southwest modified its ticket stock with the caption and it worked I love that idea. They just saved them $2 million just by saying, hey, make it very obvious this is a ticket. So obviously they can't do that today, but back then it worked And this is Herb, who is a wonderful communicator. And if you ever, I would listen to that podcast because I think it's fantastic. But if not, just search his name and you can find him giving talks. But I love the way he communicated.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, so now we're skipping ahead in the book. And this is what I was talking about. It's like you have to know what you're competing with, not who, what. And this is an idea directly from Herb Keller. When Braniff's coach price between Dallas and San Antonio was $62, and Southwest Fair was a mere $15, one of Southwest shareholders approached Keller and asked, Don't you think we could raise our prices just $2 or $3? You don't understand, said Keller. We're not competing with other airlines. We're competing with ground transportation. In many cases, Southwest makes it more affordable and certainly more convenient to fly than to drive. There's just something after reading this book and then obviously hearing him speak something. So I was actually thinking recently, you know, there's a lot of things I admire about all these different founders that”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“In markets that were disproportionately increase its costs. That's so important. Let me read it again. Southwest successful because it's willing to forego revenue generating opportunities in markets that would disproportionately increase its cost. Herb is telling us in my industry there's people that will go after 5% more, which is just a revenue generating opportunity, but it's increasing their cost by 25%. Don't do that.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“In serving its specific market niche, Southwest Airlines is obsessed with keeping costs low to maximize profitability instead of being concerned with increasing market share. Keller believes that confusing the Katoon concepts has derailed many firms, this is a direct quote from him. Market share has nothing to do with profitability. Market share says we just want to be big, we don't care if we make money doing it. That's what's misled much of the airline industry. So he's drawing on the, again, he studied the history of the industry he's in. He's like, that's what misled much of the airline industry. In order to get an additional 5% of the market, some companies increase their costs by 25%. That's really incongruous if profitability is your purpose. Southwest is successful because it is willing to forego revenue generating opportunities.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“In the courtroom. And on our side, there was just Herb. They almost wore him down to the ground, but the more arrogant they were, the more determined Herb got that this airline was going to go into the air and stay there. So Herb was a missionary zeal for competition. He thought consumers should have more choice, not less choices, and he didn't like people with big pockets and 15 lawyers trying to pick on a new startup.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“Let me just skip a couple pages real quick, and it says, so then a few, let's see, what is the time period? A few years later, he was actually vindicated. On February 14, 1975, Braniff and Texas International, these are guys who tried to do their shaining order, were indicted by the U.S. government for conspiring to put Southwest out of business and violating the Sherman Antitrust Act. So you see that passion in the language that Herb is using is because what they were doing was illegal and they didn't care. And Herb wasn't the kind of guy that was going to back down from a fight. Okay, so now let's get into some specific tactics Southwest used to get advantages in a very highly competitive market. They just said, hey, not only is there tons of other airlines, but the airline industry as a whole is just a really crappy, you know, from an economics perspective, they make small profits.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“I told Lamar you roll right over that son of a bitch and leave our tire tracks on his uniform if you have to. The very next day, june eighteenth, nineteen seventy one, Southwest Airlines was finally off the grounds.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“Please throw this out. And so he has to, the judge is like, you have to find some prior, like this happening before. So I actually have something to stand on that I'm just, so I'll do this for you, but you have to basically help me out. So says Keller went straight to the law library in the nearby Attorney General's office and worked all night to decide how to proceed and prepare the necessary papers. So we found a way to do this going through the history of Texas state law. And this is a direct quote from Herb. He says, I think it had been the procedure he used. He goes, I think it had been done once before in the history of Texas. The Texas Supreme Court ruled in Southwest favor and ordered the lower court judge not to enforce the injunction. Keller telephoned Muse and told him to put the planes in the air. When Muse confided that he was still concerned about the sheriff showing up to enforce the injunction, Keller didn't mince any words.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“Keller went straight to the law library and the nearby attorney general's office. Well, before he does that, he went to the judge, the Supreme Court judge. He's like, listen, last year you wrote an opinion in favor of Southwest.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“So going back to my notes that I took on that podcast where he talks a little bit about this, he's like, listen, I did this because I was idealistic about it. He said, if other airlines could prevent Southwest Airlines from starting, then that means that the free market system is failing. And one of the things that motivated me was to validate the free enterprise system. And another reason was it was very hot competition and I like to win.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“To lower appellate court's decision. Southwest would get its certificate to fly. So in an environment where everybody else wanted to give up, Keller's saying, no, no, I'll do this on my own time. I won't charge the company any fees for my time. I'll pay all the legal fees, like the court costs everything else out of my own pocket. And he's doing this, by the way, while he's running his business still. He's still running his law firm. That gives you an idea. And it's good that he didn't quit because, as we see, the Supreme Court actually agreed with him. Like, you can't do this.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“The members, so they lost twice now. The members of Southwest Board of Directors were growing tired and frustrated, and this is one of the, you know, gives you a good idea of who Herb Keller was as a person. While the board generally agreed that the idea was a good one, some members thought it would be wise to cut their losses. So they said, okay, let's just go ahead and give back the investor money. Let's just close up shop. We're not going to do this. At this point, Keller's street fighting spirit surfaced. Gentlemen, let's go one more round with them. I will continue to represent the company in court, and I'll postpone any legal fees and pay every cent of the court costs out of my own pockets. After much debate, the directors agreed to bet on Keller and give it one more shot. Keller argued Southwest case before the Texas Supreme Court, which overturned.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“So, this is what, so Keller's like, all right, you know, over some cocktails, I'll do this. Let's do it. And they actually write out the business plan on a cocktail napkin, and it is hanging in Southwest Airlines headquarters to this day. So this is Keller talking. We initially figured we needed around 250,000, but we doubled it because I was aware that there was going to be a fight and it was going to be a prolonged fight. But it turned out to be a much longer vendetta than I had anticipated. So he's talking about there is that They're going to go through a four and a half year battle between the time that they start Southwest Airlines before they could take their first flight. And it has to do with direct anti-competitive behavior from the local airlines in Texas. So it says on November 27th, 1967, Keller filed Southwest application to fly between Dallas, Houston, and San Antonio. So it's on February 20, 1968.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“Keller initially thought this idea was crazy, but he's intrigued enough to discuss it with King over cocktails. Okay, something else that you need to know about Herb Keller, his lifestyle is basically goes against everything people think about healthy living, yet he lived to 87. What do I mean by that? He smoked cigarettes every day. He drank a lot. He drank whiskey. I think it, or bourbons, excuse me, wild turkey bourbon, I think it was his drink of choice, and his breakfast. Let me console my notes to make sure I have this correct were cheesecrackers every day. So this guy's insane. All right, any work like 100 hours weeks. So basically everything they tell you not to do. King had studied another intrastate carrier, Pacific Southwest Airlines in California. It was the perfect model. PSA was a successful interstate airline operating in a state much like Texas.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“And we're going to skip ahead a little bit, and we're going to learn a little bit more about Herb's personality. Anyone who's ever met Herb Keller will tell you that whether he's talking to a U.S. Supreme Court justice, which he had to do to get Southwest Airlines off the ground, a member of his board of directors are a hotel valet, he displays the same level of genuine interest and intensity. He's there, and he's engaged, regardless of whom he's talking to. Okay, so now I'm skipping to the next chapter in the book, and now we're actually going to go back in time. This is always the most fascinating part to me, is the beginning of the business. What were the conditions? How did you come up with the idea? Why did you feel the need to do it? And then how did you get from starting a business to running a successful business? So this is the history of Southwest Airlines. The history of Southwest Airlines is a story of courage and perseverance. It is a tale of a group of pioneers who beat incredible odds to realize their vision. No carrier in the U.S., in the history of the U.S. airline industry, has survived quite the dramatic struggle that Southwest went through trying to get off the ground.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“The fact that what I always quote I always share on the podcast is hey, listen, history doesn't repeat what human nature does. Herb went back and studied the history of the airline industry before he started an airline. And the time he spent studying the history of the industry that he wanted to be in led him to use this tactic. And this is the reason why he says debt payments put other airlines in and out of bankruptcy forever. Now you compare and contrast that to Southwest Airlines being profitable for every single for every year for 43 years. I would argue profitability is probably the exact opposite of bankruptcy. Just side note, in case my voice sounds different, I lost my voice last week. My little daughter has the flu, unfortunately. So I'm not 100%. So that's why I might. So let's go back to the book.”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source
“I recently took notes for those of you that are already on the founder's notes, you already know this. Herb Keller a few years ago was on the podcast How I Built This, and he specifically talks about this strategy and I want to read to you what he said I'm going to read this direct quote from her. So he says we may be flamboyant from a marketing perspective and they certainly are and we'll get to that in the book but we were very very conservative from a fiscal standpoint and so you could argue that Herb is advocating for frugality, which is a very common theme on a lot of the founders that we've covered on the podcast so far. And he says we paid for 100% of our airplanes from revenue. This means you aren't taking on debt. When there are bad times, you aren't threatened by debt payments. So one thing about Herb is he was a voracious reader and he was a student of history. And one of the benefits of studying history is”
2019-01-22 · Founders · #56 The Biography of Herb Kelleher · IDENTIFIED FROM THE TRANSCRIPT · source