Host Intro (Gene Kim)

So to introduce the next speaker, the first speaker of the day, is Lauren Woods. She's SVP and Chief Information Officer at Southwest Airlines. So I met her last year, and I had the amazing experience of hanging out with her and her top 50 leaders a couple of months ago. And I've learned so much from her in every interaction that we had — especially about the unique challenges that technology leaders can face in more traditional industries, where technology isn't always associated with creating durable, sustaining competitive advantage.

In this talk, she will show how much leadership matters, among other things. She'll talk about the technology modernization journey, how Southwest has responded during crises during recent years, and leadership philosophies and development that Southwest is famous for, and how she and her team have benefited from that. So here's Lauren.

Lauren Woods

Hi everybody. How's everybody doing today? All right. Is it Tuesday? I think it's Tuesday.

So we're going to start this off, and we're going to talk a little bit today. So — he just introduced me. I'm Lauren. I am the Chief Information Officer at Southwest Airlines. And it is beyond awesome to be here with all these great tech leaders today.

Just so you know, when I first met Gene, I had like a total fangirl moment. The Phoenix Project was pretty pivotal in my career. So we actually have screenshots of this, of Gene and I both just laughing at each other and going over, just completely fangirling. So anyway, I'm pretty honored to be here today.

So anyone who has taken a flight on Southwest knows we are an airline with a unique personality. You see it reflected in the way that we do business, but you especially see it in our people, in our hospitality.

Southwest Airlines first flew in 1971 as a scrappy airline with just three aircraft flying to three cities. We called it the Texas Triangle. Southwest Airlines employees have welcomed, served, and appreciated our customers with heart for more than half a century.

Our purpose is very simple: Southwest connects people to what's important in their lives through friendly, reliable, and low-cost air travel. Southwest revolutionized the industry with low fares and friendly service, and that combination — built around supporting our people to be their best — has made Southwest the largest carrier of passengers in the United States. And we employ more than 74,000 people, which serve nearly 120 airports across 11 countries.

Just for frame of reference, the Southwest Airlines technology department supports the entirety of the airline — a combination of custom-built applications and integrated vendor products — and I mean all of it. Helping where we fly, how we price our fares, selling our seats, servicing our customers, tracking luggage, planning trips for our crew, flying airplanes, assigning gates, maintaining our aircraft, and even those backend systems like HR, payroll, finance, legal, even buying fuel for aircraft or buying aircraft itself. Those are just to name a few.

Now, before Southwest, I worked in management consulting — something maybe some of you guys do in the audience. And it was great for a young professional to work in a lot of different jobs and be able to travel. But I was so lucky when Southwest hired me 14 years ago. Always in the technology department, I started out as a manager in Southwest.com. But over the years, I've worked on all different types of digital platforms — mobile, kiosk, customer solutions, operations, flight management — and eventually in the backend systems of data, cloud infrastructure, and architecture. I was humbled to be named CIO early last year.

Southwest values developing leaders, and I was selected for this position because of exhibiting some of those Southwest leadership principles that I was instilled with within my journey. I had a track record of developing some great people, building great teams, thinking strategically, and setting a clear direction.

Southwest technology also values delivery. And during my time at Southwest, I was able to use some of those principles and develop people and build teams, but also to strategically be part of or lead large-scale initiatives — overall, requiring a clear direction to succeed. We replaced the website not once but twice, and are working on it again. Spearheaded agile transformations, changing the way thousands of people worked. We connected our systems to an all-new reservation system called the Amadeus system. It's an initiative that's the equivalent of a heart-and-lung transplant for the commercial side of an airline. And it produced more than $1 billion in benefit. We launched our extensive journey to the cloud, and we've begun our journey to transform Southwest enterprise data platforms and drive the company's data science, analytics, optimization, and system integration.

So all that sounds pretty awesome, right? Total straight line to get there.

But let's be honest — no one tends to talk about the failures or the stumbles to get to success along the way. The truth is: navigating turbulence forces you to grow. And it can be unsettling, but we become better versions of ourselves. Today I'd like to take you through the journey for my team of resilience, progress, and hopefully our bright future ahead.

Have you ever been on an airplane with kids? If you are paying attention — and I hope you were — you heard, "in the event of an emergency, put on your own oxygen mask on first." In other words, take care of yourself before you can take care of others.

When the pandemic sent the world into lockdown, many companies faced unprecedented challenges, including Southwest. After all, travel all but ceased to exist, and our revenues dropped by more than 95% in a matter of days. Our technology teams used this opportunity to prioritize investing in ourselves, and it paid off.

Like I said, we have a history of being scrappy and resilient. And in hard times, we fortify ourselves and we became stronger. The awesome work we completed during the pandemic are all the things that people don't see.

All right, I'm going to date myself here. There's a scene in The West Wing — I don't know if any of you've seen it, you supposedly can stream it now — that captures the heart of what we did so well. This is near the end of the series. And Allison Janney's character, CJ, is asked by a billionaire where his foundation should spend a billion dollars. And he's trying to make a real impact, and he is looking for an investment like fighting AIDS in Africa, or malaria, or clean-air reform. And he asks what he should do. And CJ says, "Highways. Highways are what you're looking for. It's not sexy, no one will ever fund it, no one will ever raise money for it. But nine out of 10 African aid projects fail because the medicine or the personnel cannot get to the people. Infrastructure is the problem."

So in our case, Southwest technology hit the road, so to speak, and focused on the essential highways. We made technology and infrastructure changes — modernizing pipeline capabilities to become faster, and transition toward cloud-based infrastructure. We accelerated shutting down old data centers. We built new data platforms. We set a new, solid data foundation, investing in a new cloud data warehouse, data lake, and transitioning to real-time data streaming.

Finally, we invested in our people, transitioning to an employee-led workforce. We knew then, as we know now, that employees are more invested and motivated than anyone who doesn't hold a Southwest employee badge.

That completely unplanned, unprecedented, and global crisis allowed us to set the future of tech for Southwest Airlines. Created clarity around what our team was capable of, and focused on how we as a technology organization supported the overall vision of Southwest Airlines.

While this season was difficult, it served as a catalyst for innovation and growth. And for us, we just couldn't be concerned with keeping the lights on. We had to set the stage for the future. The leap in technology was huge, but what was bigger was the leap in our mindset. Because we took time to invest in ourselves, we perfectly primed Southwest technology to take on the next big challenge.

Now, reminder — navigating turbulence forces you to grow. But remember to put your own oxygen mask on first.

Let's be real. We're all technologists here, right? Who's ever been in a situation where the problem isn't even remotely the fault of your system, yet everyone's looking to technology to solve the problem? Yes, no, maybe in the room.

I liken it to being like a designated driver at a party. You didn't bring the Wild Turkey, but all of a sudden you're responsible for getting everybody home safe.

We faced a situation like that in recent years. It may or may not have been in the headlines. It was at the worst possible time of the year for travel disruption — the holiday season. Technology, believe it or not, was not the instigator, but we rose to the expectation that it must be a large part of the solution.

What got us started was a business process problem in how we canceled our flights — and when, it imbalanced our aircraft network. And in this notable example, virtually paralyzed our crew network. We had a series of problems that exceeded anything we've ever seen, all at once. And it quickly snowballed into something that our systems simply weren't designed to handle.

But in that moment, we had to decide: how would we show up, adjust our plan? Changing altitude helps you rise above turbulence.

So how did we respond? How did we change our altitude, our perspective? First, we stayed true to our values and showed up for our customers. That's what sets Southwest apart. It was true in 1971, and it's true today. And it was true when we got ourselves into a problem that required the ultimate apology. We implemented customer self-service refunds and reimbursements, and automated the backends to process things quickly for our disrupted customers. This didn't make up for what they went through, but we knew we had to be better for our customers, we had to show them better.

We created a lost luggage tracking system on a scale we never thought would be necessary, and we did it in just a few days.

Second, we understood the need for pace over perfection. One of my proudest moments as a leader was watching our technology teams rally together and run toward the fire — leaving their own families on holiday to support their work families and enable Southwest to take care of people. We couldn't let perfect be the enemy of good. And in those critical days, we didn't have the luxury of fine-tuning or second-guessing. We had to get data quickly to our analysts so they can make quick decisions. We created dashboards to get to our leaders, to see the ongoing problems or problems that could be coming. And we collaborated with our unions to modify our work rules, to allow us to quickly notify and communicate with our employees who themselves were impacted by the disruption.

This change in altitude — this change in perspective — quickly moved us from solving for what happened to preventing certain things from ever happening again.

We quickly rallied around many solutions to support our operations, but one that I think is particularly cool is the development of a tool that we internally call Cairo. In the event of significant irregular operations, Cairo now gives us the ability to recommend which flights to cancel — with visibility and modeling to see the impact on our crew members. So now we're focused on the successful operations of flight, while minimizing the impact to our crew network.

It was visibility we simply didn't have before. Using more modern capabilities and technologies, coupled with our investment in our data foundation, we were able to build something that processes data at least 12 times faster than what we were able to do in the event. And we developed it in a quarter of the time we would have before.

I'm happy to report that, wow — we did face some challenges this last winter. We were able to leverage our new tools and processes and recover. In fact, we canceled fewer than 1% of scheduled flights, making this one of our best December operational performances in years. And that momentum of excellence carried us through the summer. So far in 2024, Southwest has the lowest cancellation rate of any US airline.

Because navigating turbulence forces you to grow. And it was hard. I mean, I'm not alone — but I had to leave my kids on Christmas morning, and I really didn't see them for another two weeks. But it forced us to adapt, to grow, to change our altitude, our perspective. And we had to become better versions of ourselves to get where we wanted to go.

Navigating turbulence forces you to grow. And through these different crises, we learned many lessons: to put your own oxygen mask on first, and to change your altitude when needed. We're now set up to do hard things.

And doing hard things creates a competitive advantage. Southwest is now positioned to deliver our unique value at accelerating pace. Technology will be key to transforming Southwest Airlines.

Technology is changing the way we build and deploy new capabilities. Changing from the way we've always done things is hard. We are not just replacing our systems, we're fundamentally changing how we are working. By embracing DevOps principles, making data a first-class citizen, and embracing a cloud-native, microservice-based architecture to allow for speed.

Southwest is also creating a competitive advantage, leveraging traditional and generative AI to solve some of our most difficult problems. It all builds on that data foundation where we invested, and empowers our employees to be more productive. We're not using AI to replace jobs. We're empowering our people to actually be more human, by more quickly solving for our customer and our employees' needs.

And finally, we're embarking on perhaps the biggest cultural change of our 50-plus-year history. It touches every job, every flight, and every seat in the air. We recently announced changes to our cabin design to meet evolving customer expectations. And that Southwest, for the first time in its history, will be assigning seats.

Guess what? The past few years poised us to leverage that change in perspective to lean into the desire of our customers and the desire of our employees — all whom are telling us clearly they're ready for this change. We've been tailoring our product to meet our customers' needs as long as Southwest has been in the air, or even an idea. The decision to update the seating and the boarding model is part of an ongoing transformation. The work to assign seats and offer premium seating will be significant. All those systems we've built over the last 50 years — none of them have the concept of seat maps, seat assignments, or selling seats. So it'll be crucial for us to incorporate new technologies and update a significant amount of operating procedures. This will fundamentally change how Southwest operates, but it will not deviate us from the course of who we are as an airline.

Our goals are ambitious, but they're very much achievable. Our technology department aims to become more reliable, more secure, and to deliver faster. Introducing new features and services that our customers and employees not just want, they expect.

We're leveraging advancements of the pandemic and lessons from the past to streamline our processes in ways that ensure that we can deliver solutions quickly and efficiently. And most importantly, we're bringing that same scrappy mindset that took us from an audacious idea, when our first flight plans among those three cities with those three aircraft. And now we're operating the world's largest airline by metrics — with more than 4,000 flights a day.

So how about I begin this approach to landing this talk? And I hope you remember three things.

Always put your oxygen mask on first. Invest in your foundation — whether it's your technology, your leadership, or your teamwork, it is crucial.

Change your altitude. Changing your altitude helps you change your perspective, and it can help you rise above the turbulence and have confidence that you can do hard things.

Everyone hits turbulence from time to time. But navigating beyond the hard things will create a competitive advantage for you.

We'll get there. Navigating turbulence forces you to grow.

All right, now — before I wrap up, I've been asked to ask for help, and I think this is a great idea, because as they talked about earlier, we're going to be more interactive in this conference. And I wanted to ask each of you to help me.

You are all business travelers with a tech mindset, so your feedback is incredibly valuable. And I would love to hear your thoughts on how we can better serve our customers. So please connect with me — you can see the QR code up there.

And if you've gone through some large-scale change, I would love to hear your one lesson — the one thing you wish you had known before you started, or one thing you learned along the way that you would be willing to share.

Thank you so much for your time today.