Lessons From The Southwest Airlines Fiasco

A seasoned corporate risk manager, now a risk consultant, opines on the recent problems at Southwest Airlines. Beginning a few days before Christmas, 2022, and extending to New Year’s, they led to the cancellation of nearly 17,000 flights, cost the company more than $800 million, and have since resulted in some reduction of executive bonuses.

In a post on the Risk & Insurance website, the writer – acknowledging he personally took a hit from the meltdown and that his current take may skirt the line on Monday morning quarterbacking – looks at what happened, and how it can be understood  as a systematic failure of risk management. There appears to have been no one, he says, “specifically tasked with the responsibility of identifying business vulnerabilities, ensuring operational resiliency and enhancing existing technologies to ensure someone had a chair at the table to speak to these issues.” In short, no effective risk management or risk assessment, and no effective planning for the most serious contingencies.