Meet the legend who inspired Ryanair to fly so high

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Meet the legend who inspired Ryanair to fly so high

Post by Ryanairflyer on Thu 16 Aug 2012 - 15:20

Meet the legend who inspired Ryanair to fly so high
Before this Irish American shook up the US airline industry, flying was only for the rich. He invented the low-cost, quick turnaround model that Michael O'Leary so successfully followed.


WHICH airline boss, renowned for witty quotes and dressing up in daft outfits for publicity, has grabbed the global air industry by the scruff of its neck with a winning formula of cheap fares and no frills flying?


Which colourful aero captain slashed operating costs on a scale never seen before by using lightning fast aircraft turnarounds, incisive fuel hedging and the pioneering use of secondary airports?

No, not Michael O'Leary (this time, at least) but the Mullingar air mullah's own aviation Obi Wan -- the legend that is Herb Kelleher, chairman emeritus of Southwest, inventor of the modern airline model and liberator of the skies on behalf of the common man. In America Herb is regarded as a unique kind of corporate superhero.

If that all sounds a bit too fanciful, consider that in the dark days before the Irish American lawyer and his partner sketched out their plans for Southwest Airlines on the back of a whiskey stained napkin (during a boozy meet in a San Antonio club in 1966), air travel had been the exclusive reserve of the stuffy well-heeled elite.

Pre-Herb, all airline seats were first class. Post-Herb, we can all use planes like buses. Herb Kelleher's life achievement has been thinking bigger to make the world smaller and more accessible for all its citizens.

Without Kelleher there would be no Ryanair, Easyjet or West Jet. His company is regularly included in America's top five favourite firms and Kelleher has been singled out by 'Fortune' magazine as "probably America's best ever CEO."

Southwest is listed in the top ten most admired companies in the world. The largest low cost passenger carrier in the United States carried 104m passengers last year on 700 jets with a staff of 46,000.

It has been consistently voted America's favourite airline and enjoys idyllic staff relations.

Wild Turkey

From his office in Love Field, Dallas (the airline's logo is a flying heart), the 81-year-old Kelleher confirms that he's still smoking 40 a day ("I'm no quitter! aha-ha-ha!") and he's equally attached to his favourite Wild Turkey bourbon whisky.

The infectious sense of humour that saw Herb famously arm wrestle a rival CEO in front of thousands for the rights to use a slogan -- remains 100% intact, more than enough to let him get away with cracking up at his own one liners. It's hard not to smile when talking to sky captain America.

"I remember the arm wrestling alright. That was 1992. It started out as a joke. The slogan was "Just Plane Smart." Instead of going to court over it I challenged Kurt Herwald (the CEO of Steven's Aviation) to arm wrestle for the rights.

"The whole thing just sort of grew legs and in the end the event was staged in the Dallas Sportorium in front of thousands. News crews from the BBC and from Tel Aviv were calling me. Of course, nobody told me that Kurt's hobby was weight lifting."

Although he lost the arm wrestling, the event gleaned massive goodwill for both firms. "The public liked that we weren't going to the lawyers to settle it."

In the end both companies agreed to share the slogan. The ironically named "The Malice in Dallas", says everything about Kelleher's win-win persona.

Amidst the colour and the wisecracks (Kelleher has also dressed as Elvis, appeared in TV ads with a bag on his head and encouraged his crews to sing their in-flight announcements) Southwest remains amazingly profitable in the world recession.

It has turned a profit every year for 30 years and recently landed a 42% profit increase for the second quarter of this year. At 81, Herb let CEO Gary Kelly take over in 2008 but remains an important adviser to his office as chairman emeritus.

Recession seems to hold no fear for the only airline kingpin with direct experience of the Great Depression.

"It wasn't quite the ''Grapes of Wrath'' in the New Jersey suburb where I grew up. But it affected everyone. No one was starving but I had friends in the neighbourhood who ate Wheaties for breakfast, lunch and dinner."

Born in 1931 into a middle class Catholic Irish American family -- he reckons his paternal grandparents were most likely from Munster ("either Cork or Kerry we think") -- Herb grew up in the New Jersey suburb town of Audubon.

He was always aware of Irish roots but it wasn't an overbearing factor. "I'm Irish on both sides, mom was a Moore. I like to think that we've had that particular Irish ebullience in us -- along with that egalitarian streak which means we're not impressed by titles or position."

His dad was a supervisor at the Dorrance family's Campbell's soup plant. "Soup did well in the Great Depression. Everyone was gobbling it given that it was tasty, nourishing and affordable.

"However Dad got sick for a long time and had to stay home, so I got to spend a lot of time with him and we used to read together. A love of reading is another Irish trait of course.

"As a boy I loved stories about adventure and all sorts of heroes, particularly knights in armour -- Sir Galahad, King Arthur and the Round Table. Those stories inspired me in my thinking.

"And I loved science fiction -- until real life science started catching up that is. And the movies! I remember 'Robin Hood' with Errol Flynn and falling completely in love with Olivia De Havilland. Feelings she never did requite by the way, ha ha ha."

In college he took English and originally had designs on being a journalist. In the end he took "the sensible route" and became a lawyer.

Shortly after getting married to Joan Negley in 1955, they travelled to her home town of San Antonio to follow the state's booming law opportunities and set up a practice.

"The first thing I noticed about Texas is that enterprise was promoted and encouraged there and the people weren't afraid of thinking big. Most of them weren't long in the oil money and they didn't think anything of gaining a fortune, losing it again and then regaining it."

One of his Texas clients from those days was the colourful Rollin King, who called him for a meeting one day in the St Anthony Club in the hotel opposite his law offices.

"Rollin was running a small third level carrier on short haul routes out of Twin Beach. He'd been talking to his banker John Parker who had been using Pacific SW, a regional airline in California and was impressed with the quality of the service.

"Parker told Rollin that he thought he ought to try and start something like that in Texas. The state was large enough and its cities geographically separate enough to support the idea. Of course I was a little sceptical at first.

Enthusiastic

"But after a few drinks I got more enthusiastic and the ideas started to flow. Rollin had heard I was a good lawyer and that I knew my way around so he wanted me aboard. So I became his first investor."

But it would be 1971 before Southwest got into the air. Three existing airlines fought Southwest's arrival through litigation and it took lawyer Kelleher more than three years to fight a way into the then heavily regulated industry.

"We didn't just ruffle their feathers, we stripped them right off those birds. And at this stage remember that we were an airline with no planes, like a hen with no chicks. Air prices were high in those days, set by federal monopolies.

"There was a lot of politics involved. Then finally we broke through. They were exciting times and once that kerosene virus gets into you, it can't be eradicated."

Kelleher took his legal assistant Colleen Barrett with him into Southwest. She became a "mother figure" in the company, nicknamed the "Queen of Hearts."

Having ascended to president of Southwest, Barrett who is today one of the most powerful business women in America, has been credited with much of the employee culture which has made Southwest such a success. They still work together.

But the newly hatched chicks almost got grilled early on. Cash troubles forced Southwest into a Hobson's choice -- letting a sizeable tranche of employees go or else selling one of their four planes.

They took the unusual step of selling the plane, in the process securing agreement from staff to promise to turn the remaining planes around on the ground in 15 minutes to make up for its loss.

This would be the seed for Southwest's almost mythically warm and productive staff relations culture to which Kelleher attributes the consistent success of Southwest.

His best known slogan: 'The business of business is people'. Controversially Kelleher says his employees are more important than his customers and shareholders.

He is alone among business chiefs in believing a company should provide a job for life. In turn Southwest staff stay with the airline and are renowned for going out on a limb for their customers and their company.

In the years that followed, Kelleher and Barrett would also be responsible for creating a corporate culture that passengers loved.

Fares were slashed, hostesses wore hot pants and customers were entertained with staff who sang their announcements -- cheer-led by Kelleher who is reputed to have asked prospective staff to take off their trousers at interviews to see if they'd be light-hearted enough for his team. The CEO regularly served drinks and snacks on board flights.

Meanwhile 2012 marks 25 years since Herb passed that success to Ryanair. The late Tony Ryan, then owner of a desperately ailing rebel Irish airline, shoved his accountant -- a 26-year-old former newsagent Michael O'Leary -- on to a plane to Dallas, Texas.

O'Leary's mission -- find Herb Kelleher, stick to him like peanut butter and drill him for his secrets on how to run a successful airline business.

Kelleher and Barrett still have fond memories of O'Leary's visit. "Oh yes we remember Michael alright, he did make an impression," chuckles Barrett from the other office.

Herb recalls: "Tony was an old friend of mine and I talked to him on and off about a lot of things. I knew he had an airline -- Ryanair -- and I knew things weren't right with it. Michael was an accountant for Tony and Tony had brought him into Ryanair to take care of that situation.

"So Michael arrived in Dallas and my first impression was that he was obviously a very bright and intelligent guy. He was very intense about his questioning I recall. There was no doubt that this guy was totally focused and on a mission.

"We went out to dinner and there was a lot of, how you'd say... intoxicating liquids consumed.

"I recall that Michael was particularly interested in a number of things -- our dedication to a niche market -- that we weren't trying to be all things to all people, and that we had no frills -- only one class service.

"I explained to him how we only made money while we were in the air and how we had succeeded in turning around our planes quickly on the ground.

"The fact that we used a single model of plane was particularly interesting to Michael -- I explained to him all the savings we made on spare parts and training. He also took note of the fact that we preferred to serve satellite airports to save money.

"After a few days of these questions and answers I put him in touch with some other people in the organisation so he could dig a little into other aspects of our operations. Then he flew home and I haven't seen him since.

Emergency

"I have corresponded with him and we've talked on the phone a few times. I have to admit that I was invited over by him on two occasions, but both times a corporate emergency came up and I had to cancel.

"That was a real shame because I was genuinely looking forward to it. But I do always follow what he's up to. He transformed a moribund airline into a roaring success. I love Michael O'Leary. He's a true crusader."

In Paul Kilduff's book 'Plane Speaking', O'Leary recalls his own version with characteristic colour: "We went to look at Southwest Airlines in the US. It was like the road to Damascus.

"This was the way to make Ryanair work. I met with Herb Kelleher. I passed out about midnight and when I woke up again at about 3am, Kelleher was still there, the *******, pouring himself another bourbon. I thought I'd pick his brains and come away with the Holy Grail. The next day I couldn't remember a thing."

But O'Leary remembered plenty. Visiting Herb was his crash course at airline Harvard.

Kelleher still doesn't rule out meeting up again. And with both airlines rumoured to be considering trans-Atlantic services, it might just be a timely encounter.

Have you ever flown a plane Herb?

"Do you know, I always wanted to learn to fly. I did try learning formally back when I was working a hundred hours a week to start Southwest but I realised I didn't have the time and I had to give up.

"But I have sat into the seat and taken the controls. I've had pilots good enough to let me, but no take-offs or landings of course. And I'd like to make it very clear that we're not talking about flying Southwest's planes with passengers on board! We're talking about the pilot's own personal planes."

Under pressure from family and colleagues, the chairman emeritus of Southwest, has at last (if somewhat reluctantly) started his memoirs.

"It's difficult to make time for writing you know." He's also currently chairman of the board of the Dallas Federal Reserve so he does have a good excuse. When his story does come out it will surely be one of the most sought after corporate biographies of modern times.

Kelleher and Barrett are finally due to depart Southwest next year after 44 interstellar years. So what's next for Herb Kelleher? The octogenarian aviator seems genuinely perplexed at the question. "Retirement? I'm far too busy here at Southwest to think about that right now!"

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