Martha DeMeo, one of my fellow bloggers, wanted me to explain how my blog disappeared off the internet the other day.

Sometimes that happens after a deliberate attack.  We usually get notified of these assaults and can protect our sites (and our client sites) in real time- if it when we have folks on duty. (No, I won’t share which few hours a day our sites are not monitored by live staff.)

But, this time, it was a function (dysfunction?) of our internet provider.  While this firm had been really good for a long time, I think it’s running into problems and we may need to search out a new provider.  Because it is no longer atypical for us to have to manipulate a few of the databases on our site so we can effect maintenance and upload new blogs.  This is a new issue. (it’s been a problem for 60 days.)

Along those lines, we just had one of our informal Board meetings.  (We have formal Board meetings [in person, at one of our locations or a specifically chosen off-site] every quarter.  We have informal board meeting every month- by phone or zoom (or hybrid).  Moreover, we have routine communications more often than that.)

And, our board was concerned about our internet provider.  They wanted to know why we were cutting them so much slack.  Having to spend an extra two or three hours a week (on top of the 10 I spend preparing and reviewing my blog) did not seem like something we should tolerate.

As we addressed the issue (it’s still not got a definitive solution), it struck me that this was the perfect time to remind y’all that (a) many of our professionals serve as Advisory and Corporate Board members to our clients; (b) we all need an outside group to challenge our decisions- maybe because they may be bad or more frequently because of our own corporate blindness; and (c) Where the heck was the Southwestern Board of Directors over the past few years?  After all, the Board is charged with ensuring that the business delivers value to its stakeholders.

(You do recall we have been discussing Southwest’s failure to handle the bomb cyclone well, right?  Part 1 here.  Part 2 here.)

Before I delve into the Southwestern Board failure, I want to remind you that Shanna Hocking (and I) have written some pretty good background pieces why we need our own boards.

This one is Shanna’s.

This one is one of my many such pieces.

So, now let’s figure out why the Southwest board has been so somnolent.  It is comprised of 11 outside members, plus the previous CEO (Gary Kelly), and the insiders (officers of the firm).  And, all these members voted for themselves for another year on the board.  No outside agitators (hedge funds, stock holders, etc.) managed to get any nominations for the board this year (or last, for that matter).

Let’s start with a simple observation.  The Board should readjust all the compensation packages.  Make them less associated with stock prices.  Yeah, that’s a great idea- except the Board is probably paid with corporate stock, too.  (Average Southwest board compensation was a drop more than $ 275K) So, it is less likely to abandon this process. (That is the reason so many firms use approach- plus, using stock awards doesn’t affect corporate cash holdings.)

The Board communications to the stockholders stressed that it had returned some $ 11 billion to stockholders by repurchasing stock and issuing dividends. (Southwest was the first airline to resume dividends after the pandemic, by the way.)  With nary a mention of corporate operational performance.  That despite the Transport Workers Union observations going back to 2018 that “Operational mishaps and technology shortcomings occur far too often…” when flights are delayed or canceled,“flight attendants are often stranded alongside Southwest customers without information.”

The Board should have taken issue with the executive focus on cutting costs, not maintaining its infrastructure, not updating its scheduling software, etc.  That is a primary function for a corporate board.

But, it’s clear this Board has the same operational blindness as do the corporate executives.

I’m hoping the Southwest shareholders get their act together and demand new Board members. Ones that will use the profits and cash to improve operations and scheduling, so fiascos that ensued at the end of 2022 won’t recur.

And, what have y’all discussed with your boards?  Are you prepared for the economic upheavals that the Feds are creating?