Southwest Air seen sticking by CEO, business model after crisis

Southwest says it’s sparing nothing in an operations review after a Christmastime meltdown stranded tens of thousands of passengers. But that’s not likely to include junking its network or losing its top executive. CEO Bob Jordan is pledging that no aspect will escape scrutiny, including the airline’s unique point-to-point route network that can limit the flexibility of its planes and crew deployment during disruptions. Jordan, who took the top job less than a year ago, told employees that he considers himself accountable for the meltdown and that Southwest may need to make adjustments to its network. “As we look backwards once we’re through this, everything is on the table,” Jordan told reporters on a conference call. He qualified those remarks by saying it’s his “gut feeling” the point-to-point system will remain in place with possible tweaks, and analysts say Jordan’s job is likely secure as he works to win back the good graces of investors and passengers. “It’s hard for me to see that any kind of heads need to roll,” said Savanthi Syth, a Raymond James Financial Inc. analyst. The airline’s outdated scheduling system is shouldering most of the blame for now, with Southwest saying it will make technology investments in that area a priority going forward. The computer software was overwhelmed when last week’s massive winter storm disrupted operations at many key airports. Analysts say the airline has historically invested too little and too late in technology compared with its peers. That reflects Southwest’s roots as a scrappy, cost-conscious Texas upstart that has rapidly grown into the largest domestic carrier in terms of passengers flown. A second meltdown in less than two years shows how vulnerable the airline’s operations have become when its network is stressed, and could constrain growth until solutions are identified.<br/>