Learning about business from Herb

I usually spend my drive time listening to news / talk radio, and yesterday I heard something that really got me to thinking.  The topic was raising the minimum wage and of course the arguments were the same as we've heard time and time again:

The conservative speaker pointed out that raising the minimum wage would help some, but would cost many jobs in the process, making it a net negative to the economy.  He went on to say that no company can pay employees more wages if they don't make the company any more money along the way.

Then the liberal speaker said workers (inflation adjusted) pay, especially at the lowest level, hasn't gone up in 20 years, while the top tier execs have seen their pay go up 200%+ in the same time.  For these people the American dream is just a mirage.  Working even two minimum wage jobs won't support a family.

Both good points, and the argument ended just as it began....square peg, round hole.  

Wanna know what I think?  I think somebody needs to sit down with Herb Kelleher and pick his brain.

This self effacing, hard drinking (Wild Turkey) smooth talking "naturalized" Texan was one of the co-founders, and later the long-time CEO, of Southwest Airlines.  He grew a handful of employees and 3 leased airplanes into the low-cost (?) juggernaut it is today, with over 550 aircraft and 45,000 employees. And they all love him.  (At least the people do, not sure about the planes.)

Herb wasn't noted for throwing around mega paychecks.  In fact, his employees were traditionally some of the lowest paid employees in the industry.  And he was one of the lowest paid major corporate CEO's, too, never receiving a salary of more than a few hundred thousand dollars a year.  (That "good for the goose, good for the gander" thing.)

When their company did well, and it almost always did, they all shared the profits and received stock options, too.  And with that, they all did just fine.  Herb might come across as just an "aw shucks" kinda guy, but I promise you he is ALL business, he is brilliant, and his people trust him.  The unions worked with him because he was fair.

He took care of his employees, never laying off even one, and if they played their cards right, more than a few retired multi-millionaires.  True!  To this day people fight for a job there, positions are that coveted.

Oh, and Herb retired in 2008 filthy rich, too.  (He had juuuuust a few more options than the rest of 'em, rightfully so.)  Herb proved that business doesn't have to be a zero-sum game....for someone to win, someone else does NOT have to lose.

And I don't think many if any of those 45,000 employees give a damn if he's a liberal, a conservative, or a pink unicorn.  So why can't the rest of us figure it out?

S