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How Southwest Airlines Screwed Up During the Holidays

On December 22, 2022, In the midst of the holiday travel rush, Southwest Airlines announced a slew of flight cancellations that lasted well onto Christmas Day and beyond, with the issue having been resolved only on the 28th.

In total, Southwest cancelled roughly 15,750 flights throughout that 7-day period. In comparison, Delta Air Lines, American Airlines, and United Airlines each cancelled fewer than 40 flights by the 28th.

Observers were surprised that such a catastrophe could happen to Southwest Airlines as they only fly one type of equipment and get their planes in and out of the airport in just 20 to 25 minutes. Questions were immediately raised as to why it happened in the first place.

The weather factor

One of the reasons cited for these unexpected issues was the weather as storms hit Chicago and Denver hard, where Southwest has two of its biggest hubs. But as some pointed out, other airlines in those two cities were also affected by the storms but did not experience problems as bad.

As it turned out, two serious issues stood out that contributed to the greater degree of disruption Southwest faced during the holidays.

Limitations of Southwest’s “point-to-point” model

One of them is its “point to point” model that allows passengers to travel directly between smaller markets without stopping at a hub airport. By contrast, most airlines use a "hub-and-spoke" system, in which planes typically return to a hub airport after flying out to other cities.

Because of this, point-to-point flights provide the advantage of shorter travel times. However, operations-wise, the disadvantage shows. That is because the “point-to-point” model involves planes flying consecutive routes and picking up crews from city to city, so when there is a cancellation in one area, it creates a domino effect that prevents crew and planes to be at the location where they’re needed, thus giving rise to more delays. On the other hand, in the hub model, airlines can quickly fly crews and planes to where they are needed.

Complicating matters is the fact that Southwest does not yet have agreements with other airlines so they could not rebook passengers with other airlines, forcing many people to wait days until Southwest was able to resolve the matter.

Outdated and inadequate scheduling software

This leads to the issue that mainly contributed to the massive disruptions: Southwest’s scheduling software which was revealed to be outdated and inadequate to meet the demand not only from the passengers but from their crew as well.

It was revealed during a call conducted by Southwest Chief Operating Officer Andrew Watterson with employees that the airline’s outdated scheduling software couldn’t keep up with the constant changes to the point that it was not able to track anymore where its crew members and pilots were after the cancellation of many flights.

Watterson added that Southwest’s crew schedulers worked overtime to put a new schedule together but they were bound by the regulations enforced by the Federal Aviation Administration as to when flight crews can work. As a result, Southwest ended up with planes that were ready to take off with available crew, but the company’s scheduling software wasn’t able to match them quickly and accurately.

Watterson also admitted that manual scheduling left Southwest in a precarious situation that would go awry the moment the company encountered a problem.

Southwest’s shortcomings

Diginomica did not mince words in saying that Southwest’s management cut corners in modernizing the airline’s 20-year-old routing system rather than having it upgraded or replaced so it could better handle its expanding operations. Instead, Southwest opted to implement numerous patches to the system that ended up adding complexity to the system that should not be there in the first place.

It is surmised that Southwest’s scheduling optimization software is so old that it could not have been capable to handle such an enormous disruption. Older patched software is subject to “technical debt,” a deficiency between the current requirements and. advanced technology and what it needed. But while airlines, which were early adopters of automating optimization models, are susceptible to technical debt, Southwest’s technical debt is at a worse level.

This problem was not a new discovery but is one Southwest has been aware of for a long time. In fact, in an open letter to the company back in March 2022, the airline’s flight attendants’ union sacrificed their pay increase demands in favor of supporting the need to update its scheduling technology. Unfortunately, no action was taken by the management which led to the massive disruption it experienced in the holidays, which adversely affected its bottomline.

It remains to be seen whether Southwest will finally get its act together and finally address the lingering issues. One can only hope that such actions will be taken before it gets hit by an even worse disruption that the airline may find harder to overcome.

An overlooked but critical aspect of technology

It goes without saying that technology is a vital aspect of any business operation that should always keep pace with the present demands, if not anticipate the future demands which is even better, coming from both within and outside the organization. This should be common knowledge at this point.

As the incident that affected Southwest Airlines shows, some decision-makers are not able to put in the required effort and due diligence that is needed to ensure the technology their businesses are using is, at the bare minimum, up to the current standards. Regardless of their reasons for such actions, such failure can cost a business millions in lost revenue, loss in competitive edge, and a decreased level of trust from stakeholders within and outside the organization.

Technology must serve to meet the needs of its stakeholders at all times. And if it is unable to meet those needs, it is in the organization’s best interest to seek better technologies not only for the benefit of its stakeholders but for its own growth as well.


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