After spending 13 years at Southwest Airlines with Herb Kelleher at the helm, human resources diva Libby Sartain understands the value of creating workplace wackiness and fun. She recalls the times when the zany CEO cracked jokes and showed up dressed like Elvis Presley. She figures that’s part of the reason she was immediately drawn to a whimsical sculpture in the lobby of Yahoo! Inc. headquarters on her first visit to the dot-com powerhouse. It is a huge, goofy purple cow, with a built-in computer jutting out of its side for MooMail. It spoke to her.
She called her husband on a cell phone at once. "I said, ‘We’re moving to California.’ "
The move to Silicon Valley as senior vice president of human resources two years ago, after a lengthy career in Dallas with the successful, high-spirited airline, took Sartain from one dynamic corporate culture to another. Creating human resources programs around people-centric corporate brands such as Yahoo and Southwest--whose workforces are known for their exuberance, ingenuity and irreverence--has made her one of the best-known up-from-the-ranks workforce management executives in America. At a recent promotional event where she signed copies of her new book, HR from the Heart, the former chair of the 170,000-member Society for Human Resource Management drew long lines of fans. The initial stock of 400 books quickly sold out. "She’s definitely a role model," said Tracie Brunt, a human resources professional from North Carolina.
At a time when many human resources managers are stuck in an identity crisis, wondering what it will take to play a more strategic role and secure a place among top management, Sartain stands out. She’s the first to admit that her flash and outspoken style might not go over at more buttoned-down companies. But by finding her professional niche with companies like Yahoo and Southwest--and doing it her own way--Sartain has proved that a onetime back-office comp-and-benefits specialist can push herself all the way to the executive committee.
Over the years, she has won friends within the human resources field by accepting non-glamorous roles such as chairing SHRM’s benefits and compensation committee. She is also a fellow of the National Academy of Human Resources. "She brings a great commitment to the profession," says Susan Meisinger, president of SHRM. Friends remember when she headed the SHRM board of directors. Attorney Johnny Taylor Jr., secretary of SHRM’s board of directors, says her tenure in 2001 required skillful diplomacy. "Our board meetings were downright acrimonious," Taylor says. "Libby had to take the egos of 17 professionals, and manage them, and not let the contentious natures of some people deter us. You want to talk about walking a tightrope. She did it." He and others considered quitting the volunteer board. "Libby just worked the room, going from group to group, talking to the leadership, not being drawn into fights. Any less able leader would have been in trouble."
Despite her ease with hugs and handshakes, Sartain doesn’t want to be mistaken for a doormat. She writes that "people who think they’ve sized me up as a pushover or think that I don’t understand the hard realities of business are in for a big surprise. And probably not a very pleasant one, either, if those people are on the losing end of going mano a mano with me in a business-related face-off."
Handling metrics and people
Sartain is considered equally adept at handling the technical, process side of human relations, such as metrics and benefit-plan designs, and the people side, where the value is on human relationships and creating effective corporate cultures. "She brings the people piece of it as well as the business piece of it, and that’s a great combination," Meisinger says. Dave Ulrich, a professor of business administration at the University of Michigan and a human resources consultant, will go so far as to call Sartain "the standard for the soul or heart" of the people side of human resources management. "She looks you in the eye when she talks, listens to the alternative points of view and knows that what she does impacts people," Ulrich says. "She is tough-minded and able and willing to make decisions." Those who have followed her career still remember a speech she gave to the Institute of Management Consultants several years ago. She took a tough stance on bringing in consultants at Southwest, requiring, among other things, that they convince her they could save the company money or improve productivity.
Among the first decisions she had to make when she arrived at Yahoo in August 2001 was how best to handle the layoffs of 400 Yahoos, as the engineers and Web technicians are called, a number that at the time represented 12 percent of the workforce. In all, Yahoo during 2001 reduced its workforce by about 650 employees, a 20 percent drop, costing the company $15.1 million in severance and fringe benefits. The dot-com bubble had burst, and Yahoo was hemorrhaging money. Its stock plunged from $250 a share the year before she arrived to less than $9 the year after. The layoffs remain a painful memory. Sartain’s job was to execute the plan, making sure that those who were laid off were treated well and that the survivors understood the truths of the new high-tech world. One of the new realities is that the days of through-the-roof stock prices and of young high-tech companies like Yahoo churning out millionaires practically over-night are over, she says. Done. Finis.
"The world changed. I actually think it’s a good thing. I would much rather hire an employee who wants to be here in the long term and grow with the company" than someone "who comes in with the idea that ‘I am going to stay here until my options vest and leave as a millionaire.’ The ’90s were totally crazy, and I hope we’ve learned our lesson as a business community."
Since the rough retrenchment, Yahoo has begun to grow again. Under CEO Terry Semel, the company is experiencing double-digit growth in revenues. Stock in the 8-year-old market leader is trading in the mid-$30s, far below its historic high of $250 but comfortably above its single-digit low. Sartain compares Yahoo at this point to Southwest when she started there--a brash, maturing company expecting a lot of growth. With the painful layoffs behind it, Yahoo again is in an expansion mode. Hiring is up, along with the stock price. Looking forward, Sartain plans to focus on developing talent. "Yahoo is only 8 years old, so as we were growing, we didn’t have all this talent to promote because we were adding, adding, adding," she says. "We now need to get into this thought of career development, growing the talent, developing the talent and helping people learn how to move across businesses."
"It's very hard to keep up a positive corporate culture."
With its engineers, Web designers and computer technicians, many with graduate degrees, the workforce at Yahoo is much different than the pilots, aircraft mechanics and reservation agents at Southwest. But both companies promote irreverence, innovation and a fun-loving ambience that is built into their conventional focus on bottom-line results.
Southwest, a mainstay on Fortune magazine’s list of America’s most admired companies, is widely known for its high-spirited, customer-friendly workforce and a corporate culture that engenders loyalty, both from the top down and the bottom up. Kelleher, one of Southwest’s founders, is generally credited with being most responsible for the airline’s culture. But as vice president of people at the airline, Sartain for many years provided the stewardship. It was an immense challenge. Many, inside and outside the company, believe that keeping the airline’s seats filled has as much to do with the good vibes coming from the organization’s workforce as it does with its gold-standard formula of point-to-point flights and low-cost fares. When Sartain began working at Southwest in 1988, it had 6,500 employees. Today the workforce is about 35,000. Since she left, labor problems have tarnished the airline’s glow. Flight attendants have been demonstrating at airports and organizing other protests over what they say is the lowest pay in the industry. They also complain that they have to clean their planes between flights, a job done by special crews at most airlines.
Kevin Freiberg, co-author of Nuts! Southwest Airlines’ Crazy Recipe for Business and Personal Success, says critics keep predicting that Southwest will get so big it will outgrow its "We’re family" spirit. It hasn’t happened yet, despite the recent turmoil. During Sartain’s tenure, it took work to maintain the airline’s collective personality, Freiberg says. "Though it appears fun on the outside, on the inside it was competitive and serious. You had to produce." Marshall Goldsmith, a nationally prominent executive coach, has seen airlines come and go. He recalls the growth and then the demise of PSA--the airline with a smile--and Pan American. "It’s very hard to keep up a positive corporate culture," Goldsmith says.
Shaping a corporate personality
Before joining Southwest, Sartain worked in comp-and-benefits at the Mary Kay cosmetics company, another organization with a strong sense of identity. It was there that she first learned the importance of corporate personality, though at times Mary Kay’s clashed with her own. At one point, she was advised to tone down her laughter. At Southwest, by contrast, she could be herself. The company has the kind of culture that "must be understood by everybody when they come in." Yet new employees can’t know everything about a company when they walk in the door. "It evolves over time."
After spending most of her career at Southwest, Sartain decided it might be time for a new challenge. In her book, she says she was recruited by a Silicon Valley Internet company--not Yahoo--and decided it would be a good fit and then told Southwest she would accept a job if it was offered. Southwest didn’t discuss a counteroffer, and she was gone. Then the job she thought she had fell through. Recalling her departure, she says that leaving Southwest "was like getting a divorce--it was horribly wrenching." Wherever she landed, it had to be the right fit, a place, as she likes to say, where she could laugh out loud in the hallways, wear bright colors and be herself, contribute and deliver business results.
Yahoo prizes wacky collegiality, imagination and hard-nosed business practices. There is a Foosball game at the coffee bar on the first floor of the corporate offices. Bold splashes of purple and yellow enliven the utilitarian steel-and-glass buildings on the sprawling corporate campus. To keep employees on-site and at work, Yahoo provides dry-cleaning pickup and delivery, a masseuse, a dentist who works out of a mobile clinic and a gym.
In keeping with its egalitarian values, everyone--including the CEO--works in a cubicle. Sartain admits that the cubicle culture is an acquired taste. She makes sensitive phone calls from a conference room or takes her cell phone outside. But she likes the banter. "Whenever I get a free moment at my desk, I love hearing what’s going on," she says.
A transferable profession
There are, of course, obvious business differences between Southwest and Yahoo. Still, Sartain says, "HR is pretty much the same wherever you go. One of the things I love about it is that it’s a really transferable profession." Over the years she has had a number of mentors. One of the most influential was Colleen Barrett, Southwest’s president, who promoted her to "an HR chief."
She remembers Barrett’s direct style of problem-solving. "For example, when we had a morale problem in a particular location or department, she taught me to just call meetings with groups of employees. The two of us would arrive with a notepad and no agenda, and by the end of the meeting we knew the issues and could develop an action plan to fix the problem."
Sartain, who was raised in New Orleans, says she inherited her outgoing, friendly disposition from her father, an investment banker. Her mother was quieter. "I overheard my mom say, ‘I have two normal daughters, and then I have Libby.’ Mom thought I was totally weird."
After 25 years in the business, Sartain still frets about personnel decisions that disrupt people’s lives and families. "Every now and then there is a situation that eats away at me because it’s just a really bad situation," she says. When employees are laid off, "those are often times when I am needed the most. How you treat people when they are being laid off makes all the difference in the world for them and how they go on to their next role." Yet, she says, you have to move on. "I don’t spend a lot of time worrying about things. Otherwise, I would never get anything done."
She says her experience at Southwest cemented her position as a guru of human resources. "I had the great fortune of being at Southwest Airlines, a fabulously run company, and I woke up one day and was the VP for people in the No. 1 best company to work for in America," she says. "So suddenly everyone in the world wants to know what our secrets are. And our secrets aren’t really that much of a rocket-science kind of deal."
She says that what matters is being straight with people. "I was honest, I wasn’t pretentious and I talked just as much about stuff we tried that didn’t work as stuff we tried that did work. I probably was the first one that came out and said, ‘Here is what it’s like in the real world.’ "
Workforce Management, August 2003, pp. 42-45 -- Subscribe Now!