Customer-service fiascos like Southwest’s spark a harsh backlash and prompt corporate leaders to promise changes. But blunders often are soon forgotten.
a business professor at Northwestern University whose work includes corporate ethics and crisis management.
Softness in bookings may last “until the half life of the anger is over and people are making spring-break plans,” said Andrew Davis, a former transportation analyst with T. Rowe Price Group Inc., which is a long-term airline investor and currently Southwest’s fourth-largest shareholder.Shares of Southwest began rebounding Thursday but were still down more than 9% for the week. Analysts have estimated the crisis may cut fourth-quarter profit by up to 5%.
Internally, such a crisis can be all-consuming for a company. And although industry watchers say the incident is unlikely to put Southwest’s leaders in jeopardy, it will fuel plenty of scrutiny. “People tend to move on once they’re made whole in some way,” he said. “They’re still angry, but they got some goodies out of it.”
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