Herb Kelleher was an Expert at Managing Growth
One of the more negative impacts on workers in a business is layoffs. Those executives that know best how to manage growth will find their people positive and working with a lack of fear over concerns they could lose their jobs because of outside forces.
Those that manage their company's growth the best will have the best defense against forces outside the company; like economic downturns.
Kelleher was an expert at this, as he never would hire beyond stretching his existing people, which is one of the major problems connected to laying people off. If there were times when some circumstance arose which demanded more attention, he would allow those who wanted to to work extra hours do so over a period of time, rather than hire new people to take care of it.
When you consider the cost of hiring and training new people, this is a great way of taking care of occasional windfalls in work and opportunities. Otherwise what happens is you have temporary people who will have to be laid off after the period of time is over.
This is important because of the inevitable connections workers make with each other on the job, and the resultant discouragement, fear and demotivation that accompanies people being let go.
The question of taking on extra work is more important to managing than a lot of executives understand. Not all supposed opportunities should be taken, and many times the short term benefits that come with it aren't worth the eventual impact of what you have to do after the extra business is over.
To my knowledge, Southwest Airlines (NYSE:LUV) has never laid off an employee to this day. That's good management.
It's not just having the attitude of treating your people good, which is important, it's understanding the costs and effects that come with new business and how to handle taking care of it; or if you should take it on the first place. Ask your people if they want the extra hours and money to work with it. If they don't, it would be better to bypass it than to take it on and then lay off those you hire to do it. The emotional cost is far too great for a one-time windfall for the business.
Other Herb Kelleher Sources:
Herb Kelleher on the Record, Part 1
Belief Model for The Leadership of Herb Kelleher (Southwest Airlines)
Herb Kelleher, Chairman, CEO and President, Southwest Airlines
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