Tom Peters’ EXCELLENCE. ALWAYS. Bunge/Senior Managers’ Meeting 11 June 2008/Buenos Aires.

Tom Peters’ Tom Peters’

EXCELLENCEXCELLENCE. ALWAYS.E. ALWAYS.

Bunge/Senior Managers’ MeetingBunge/Senior Managers’ Meeting11 June 2008/Buenos Aires11 June 2008/Buenos Aires

NOTENOTE:: To appreciateTo appreciate this presentation this presentation [and ensure [and ensure

that it is not a that it is not a messmess],], you need you need Microsoft fonts:Microsoft fonts:

“Showcard Gothic,”“Showcard Gothic,” “Ravie,”“Ravie,” “Chiller”“Chiller”

andand “Verdana”“Verdana”

Slides at …

tompeters.comtompeters.com

““We Have …We Have …

ThankThank you, you,

Starbucks!Starbucks!

Sports:Sports: You You beat beat

yourself!yourself!

InternalInternal organizational organizational

excellenceexcellence* *** ** = = Deepest “Blue Deepest “Blue

Ocean”Ocean”

**A “Blue ocean” is by A “Blue ocean” is by definition very profitable … definition very profitable … and will be and will be quicklyquickly copiedcopied. .

““sustainablesustainable blueblue” (Internal ” (Internal organizational excellence) is organizational excellence) is

far more far more difficultdifficult to copy. to copy.

****Internal Internal organizational organizational excellence = excellence =

““BrandBrand insideinside””

B(I) > B(O)B(I) > B(O)

ThankThank you Herb you Herb

““You have to You have to treat your treat your

employees like employees like customers.”customers.” —Herb Kelleher, —Herb Kelleher,

upon being asked his “secret to success”upon being asked his “secret to success”

Source: Joe Nocera, Source: Joe Nocera, NYTNYT, “Parting Words of an Airline Pioneer,” , “Parting Words of an Airline Pioneer,” on the occasion of Herb Kelleher’s retirement after 37 years on the occasion of Herb Kelleher’s retirement after 37 years at Southwest Airlines (SWA’s pilots union took out a full-pageat Southwest Airlines (SWA’s pilots union took out a full-page ad in USA Today thanking HK for all he had done; across thead in USA Today thanking HK for all he had done; across the

way in Dallas American Airlines’ pilots were picketing theway in Dallas American Airlines’ pilots were picketing the Annual Meeting)Annual Meeting)

ThankThank you Ben, you Ben, Norm, Ike Norm, Ike

and and DelawareDelaware

GiveGive good good tea! tea!

““Allied commands depend Allied commands depend on mutual confidence on mutual confidence [and this confidence] [and this confidence] is gained, above all is gained, above all

through the through the develodeveloppmentment of friendshiof friendshippss.”.”

——General D.D. Eisenhower, General D.D. Eisenhower, Armchair GeneralArmchair General* (05.08)* (05.08)

*“Perhaps his most outstanding ability [at West Point] was*“Perhaps his most outstanding ability [at West Point] was the ease with which he made friends and earned the trust the ease with which he made friends and earned the trust of fellow cadets who came from widely varied backgrounds;of fellow cadets who came from widely varied backgrounds; it was a quality that would pay great dividends during his it was a quality that would pay great dividends during his

future coalition commandfuture coalition command

““Ninety Ninety percent of percent of success is success is

showing up.” showing up.” ——Woody AllenWoody Allen

ThankThank you Rich! you Rich!

““Mapping your Mapping your competitive competitive position”*position”*

or …or …

*Rich D’Aveni/*Rich D’Aveni/HBRHBR

The The “Have “Have you …”you …”

50*50**See *See Appendix OneAppendix One

1. Have you in the1. Have you in the last last 1010 daysdays … … visitedvisited a a customer?customer?2. Have you called a 2. Have you called a customer … customer … TODAYTODAY?? * * * * * *

ThankThank you you

Dr. GroopmanDr. Groopman

18’18’

ThankThank you Dick & you Dick &

DanDan

Dick (Build!)Dick (Build!)Dan (Report on Dan (Report on what not built)what not built)

ThankThank you Walter you Walter

Politics Politics politics politics politics politics politics politics politicspolitics politics politics politics politics politics politics politics politics politics politics politicspolitics politics politics politics politics politicspolitics politics politics politics politics politicspolitics politics politics politicspolitics politics politics

politicspolitics

??????????????

“Success doesn’t depend on the number of “Success doesn’t depend on the number of people you know; it depends on the number people you know; it depends on the number

of people you know in of people you know in hihigghh places!”places!”

oror


of people you know in of people you know in lowlow places!” places!”

ThankThank you you

HeatherHeather

10 UNASSAILABLE REASONS WOMEN RULE10 UNASSAILABLE REASONS WOMEN RULE

WomenWomen make [all] the financial decisions.WomenWomen control [all] the wealth.WomenWomen [substantially] outlive men.WomenWomen start most of the new businesses.Women’sWomen’s work force participation rates have soared worldwide.WomenWomen are closing in on “same pay for same job.”WomenWomen are penetrating senior ranks rapidly [even if the pace is slow for the corner office per se].Women’sWomen’s leadership strengths are exceptionally well aligned with new organizational effectiveness imperatives.WomenWomen are better salespersons than men.WomenWomen buy [almost] everything—commercial as well as consumer goods.

So what exactly is the point of So what exactly is the point of menmen??

ThankThank you Sheik you Sheik MohammadMohammad

24%24%

Single Single greatest act greatest act

of pure of pure imaginationimagination

ThankThank you Bob you Bob

Excellence1982: The Bedrock “Eight Basics”Excellence1982: The Bedrock “Eight Basics”

1. A Bias for 1. A Bias for ActionAction2. Close to the 2. Close to the CustomerCustomer3. 3. AutonomAutonomyy and and EntreEntreppreneurshireneurshipp4. Productivity Through 4. Productivity Through PeoPeopplele5. 5. Hands OnHands On, , Value-DrivenValue-Driven6. 6. Stick toStick to the Knitting the Knitting7. 7. SimSimpplele Form, Form, LeanLean Staff Staff8. Simultaneous 8. Simultaneous Loose-TightLoose-Tight Properties” Properties”

““Breakthrough” 82*Breakthrough” 82*

People! People! CustomersCustomers

! ! Action! Action! Values! Values!

**In Search of ExcellenceIn Search of Excellence

ThankThank you Siberia you Siberia

in May!in May!

Why in Why in the the World did World did youyou go to go to SiberiaSiberia??

EnterpriseEnterprise* ** (*at its best):* ** (*at its best): An An emotionalemotional, , vitalvital, , innovativeinnovative, , jojoyyfulful, , creativecreative, , entreentreppreneurialreneurial endeavor endeavor that elicits maximum that elicits maximum

concerted humanconcerted human potential in the potential in the wholeheartedwholehearted serviceservice of others of others.****Employees, Customers, Suppliers, Communities, Owners, Temporary partners**Employees, Customers, Suppliers, Communities, Owners, Temporary partners

“I am often asked by would-be entrepreneurs seeking escape from life within huge corporate structures, ‘How do I build a small firm for myself?’ The

answer seems obvious: Buy a Buy a very large one very large one and just waitand just wait.”.”

—Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics

“Forbes100” from 1917 to 1987: 3939 members members

of the Class of ’17 were alive in ’87; 18 in ’87 of the Class of ’17 were alive in ’87; 18 in ’87 F100; 18 F100 “survivors” significantly F100; 18 F100 “survivors” significantly

underunderpperformederformed the market; the market;

just just 22 (2%), (2%), GEGE & & KodakKodak, ,

outoutpperformederformed the market from the market from 1917 to 1987. 1917 to 1987.

S&P 500 from 1957 to 1997: 7474 members of the Class of ’57 were alive

in ’97; 1212 (2.4%) of 500 outperformed the market from 1957 to 1997.

Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market

GEGE

Decentralization to the point of failure to pursueDecentralization to the point of failure to pursue synergies synergiesAccountability (extreme, merciless, all levels)Accountability (extreme, merciless, all levels)ProfitabilityProfitabilityMetric madness (not portable—the Nardelli caseMetric madness (not portable—the Nardelli caseSix-sigma religion (limits innovation? 3M, Boeing?)Six-sigma religion (limits innovation? 3M, Boeing?)Execution (Bossidy) Execution (Bossidy) Truth-tellingTruth-tellingDecentralized staff except for financial integrity, risk,Decentralized staff except for financial integrity, risk, management, management development management, management developmentOperational excellenceOperational excellenceCentralized major initiatives with teeth, but not to theCentralized major initiatives with teeth, but not to the detriment of decentralization, accountability (e.g., via detriment of decentralization, accountability (e.g., via best practicesbest practicesManagement development (Deep)Management development (Deep)Succession effectiveness (Jones, Welch, Immelt) Succession effectiveness (Jones, Welch, Immelt) (universal) (universal)Up or outUp or outTargeted acquisitions Targeted acquisitions

““Mr. Foster and his McKinsey Mr. Foster and his McKinsey colleagues collected detailed colleagues collected detailed

performance data stretching back performance data stretching back 4040 years for years for 1,0001,000 U.S. companies. U.S. companies. They

found that none of the

long-term survivors managed to outperform the market. Worse, the longer companies had been in the

database, the worse they did.” —Financial —Financial

TimesTimes

““Data drawn from the real world Data drawn from the real world attest to a fact that is beyond attest to a fact that is beyond

our control:our control: Everything in existence tends to deteriorate.”

—Norberto Odebrecht, —Norberto Odebrecht, Education Through WorkEducation Through Work

$10,000,000/Day

Mission impossible?Mission impossible?

$36B/’98$36B/’98

minus minus $675M/‘$675M/‘

0707

$10,000,000/Day

““Citigroup merger a Citigroup merger a mistakemistake ” ”““sadsad story” story”

“The stockholders have “The stockholders have not not benefitedbenefited. The employees . The employees

certainly have certainly have notnot benefitedbenefited and I don’t think the customers and I don’t think the customers

have benefited because our have benefited because our franchises are franchises are weakerweaker than than

they have been.”they have been.”Source:Source: Financial TimesFinancial Times, 0404.2008 (All quotes , 0404.2008 (All quotes

courtesy courtesy John ReedJohn Reed, who crafted the Citi-, who crafted the Citi-Travelers merger in 1998 in a $166B deal)Travelers merger in 1998 in a $166B deal)

““Despite a decade of Despite a decade of banking mergers, there banking mergers, there is

no evidence that big banks are any more efficient or

profitable than their smaller rivals.” —Financial Times, 0329, on

possible Barclays-ABN Amro merger (“When it comes to asking the stock market whether

bigger banks are better, the current answer is a resounding ‘no.” —Citigroup analysis, 2006) analysis, 2006)

“When asked to name just one big merger that had lived up to

expectations, Leon Cooperman, former cochairman of Goldman Sachs’

Investment Policy Committee,

answered: I’m sure there are success stories out

there, but at this moment I draw a

blank.” —Mark Sirower, The Synergy Trap

Dick Kovacevich: You don’t get better by

being bigger. You get worse.”

““A pattern emphasized in the case A pattern emphasized in the case studies in this book is the degree to studies in this book is the degree to

which powerful competitors which powerful competitors not only not only resist innovative threats, but resist innovative threats, but actually resist all efforts to actually resist all efforts to

understand themunderstand them,, preferring to preferring to further their positions in older further their positions in older

products.products. This results in a surge of productivity and performance that

may take the old technology to unheard of heights. But in most cases

this is a sign of impending death.” —Jim Utterback, Mastering the Dynamics of Innovation

There’s “A”“A” and then

there’s “A.”“A.”

Winning the Merger Game Winning the Merger Game IsIs Possible Possible

--Lots of deals--Lots of deals--Little deals--Little deals

--Friendly deals--Friendly deals—Stay close to core competence—Stay close to core competence—Strategy is easy to understand—Strategy is easy to understand

Source: “The Mega-merger Mouse Trap”/Source: “The Mega-merger Mouse Trap”/Wall Street Wall Street Journal/Journal/02.17.2004 / David Harding & Sam Rovit, Bain & Co./re Comcast-02.17.2004 / David Harding & Sam Rovit, Bain & Co./re Comcast-

DisneyDisney

#1.1#1.1

The The lastlast word: word: There There is is nono “last “last

word.”word.”

Flat as a Pancake (Or Worse)Flat as a Pancake (Or Worse)

Wal*Mart … Wal*Mart … Dell … Intel … Dell … Intel … Yahoo … Home Yahoo … Home

Depot … Depot … Microsoft … GEMicrosoft … GE

““It is It is notnot the the strongest of the strongest of the

species that survives, species that survives, nornor the most the most

intelligent, but intelligent, but the the one most one most responsive responsive

to changeto change.”.” —Charles Darwin

C.E.O.C.E.O. to

C.D.O.C.D.O.

CChief hief DDestruction estruction

OOfficerfficer

Q4/2006Q4/2006

+500,000+500,000

Source: Source: Barron’sBarron’s 0922.07 0922.07

Q4/2006Q4/2006

+500,000+500,000 = ? = ?


Q4/2006Q4/2006

+500,000+500,000 = =+7,700,000+7,700,000-7,200,000-7,200,000


#1 Exporter?#1 Exporter?

#4 Japan#4 Japan#3 USA#3 USA

#2 China#2 China

#1 #1 GermanyGermany

Reason!!!Reason!!!

MittelstandMittelstand

Or …Or … Goldmann Goldmann ProduktionProduktion

ss(11/50%/$5M/”dip and coat,” expensive (11/50%/$5M/”dip and coat,” expensive

pigments vs “through coloring,” fades Bekro pigments vs “through coloring,” fades Bekro Chemie)Chemie)

Focus:Focus: “A recent study by “A recent study by [Stanford] Business School faculty [Stanford] Business School faculty

shows that producers whose shows that producers whose offerings or expertise are more offerings or expertise are more

clearly associated with one or two clearly associated with one or two product categories have better product categories have better

salessales than those whose goods or than those whose goods or

professional identity span multiple professional identity span multiple categories.categories. More focused producers throw More focused producers throw

off subtle hints that they know their stuff, off subtle hints that they know their stuff, which is not lost on customers. In short, says which is not lost on customers. In short, says

professor Michael Hannan, ‘The jack of all professor Michael Hannan, ‘The jack of all trades is the master of none governs consumer trades is the master of none governs consumer

choices of whose goodies to buy.’ ”choices of whose goodies to buy.’ ” —Stanford —Stanford Business, 0208Business, 0208

The The

black black swanswan

1982 1982 (-)(-) = = 200 200

Years Years (+)(+)

1982/Default Latin 1982/Default Latin

America = America = 200 200 yearsyears [Total historical [Total historical

earnings]earnings]

The Black Swan: The Impact of theThe Black Swan: The Impact of the Highly Improbable Highly Improbable, Nassim Nicholas Taleb, Nassim Nicholas Taleb

Career =Career = 11 or or 22 black black swansswans

Black Swan:Black Swan: This This is how you earn is how you earn

your payyour pay!* **!* **

*See: *See: The Black Swan: The Impact of the Highly The Black Swan: The Impact of the Highly Improbable Improbable, Nassim Nicholas Taleb, Nassim Nicholas Taleb

**WSC: **WSC: “When the seas are calm all ships alike show “When the seas are calm all ships alike show

mastership in sailing.”mastership in sailing.”

““Character is more crucial now Character is more crucial now than ever, because in times of than ever, because in times of

great uncertainty past great uncertainty past performance is no indicator of performance is no indicator of

future performance. future performance. Experience falls away and all Experience falls away and all

you’re left with is character.” you’re left with is character.” ——David Rothkopf, founder of a firm that helps chief David Rothkopf, founder of a firm that helps chief

executives manage risksexecutives manage risks

““Diverse groups of problem solvers—Diverse groups of problem solvers—groups of people with diverse tools—groups of people with diverse tools—

consistently outperformed groups of the consistently outperformed groups of the best and the brightest. If I formed two best and the brightest. If I formed two

groups, one random (and therefore groups, one random (and therefore diverse) and one consisting of the best diverse) and one consisting of the best individual performers, the first group individual performers, the first group

almost always did better. … almost always did better. …

DiversityDiversity trumped trumped abilityability.”.” —Scott Page, —Scott Page, The Difference: How The Difference: How

the Power of Diversity Creates Better Groups,the Power of Diversity Creates Better Groups, Firms, Schools, and Societies Diversity Firms, Schools, and Societies Diversity

Fooled by Randomness: The Hidden Role of Chance in Life and the Markets,Fooled by Randomness: The Hidden Role of Chance in Life and the Markets, Nassim Nicholas Taleb Nassim Nicholas Taleb “This “This book is about luck disguised and perceived as non-luck (that is, skills) and more book is about luck disguised and perceived as non-luck (that is, skills) and more generally randomness disguised and perceived as non-randomness. It manifests generally randomness disguised and perceived as non-randomness. It manifests itself in the shape of the lucky fool, defined as a person who benefited from a itself in the shape of the lucky fool, defined as a person who benefited from a disproportionate share of luck but attributed his success to some other, disproportionate share of luck but attributed his success to some other, generally precise reason.” generally precise reason.”

The Black Swan: The Impact of the Highly ImprobableThe Black Swan: The Impact of the Highly Improbable,, Nassim Nicholas TalebNassim Nicholas Taleb

Expert Political Judgment: How Good Is It? How Can We knowExpert Political Judgment: How Good Is It? How Can We know?? Philip Tetlock Philip Tetlock “A fox, the thinker who “A fox, the thinker who knows many little things, draws from an eclectic array of disciplines, and is better knows many little things, draws from an eclectic array of disciplines, and is better able to improvise in response to changing events, is more successful in able to improvise in response to changing events, is more successful in predicting the future than the hedgehog, who knows one big thing, toils devotedly predicting the future than the hedgehog, who knows one big thing, toils devotedly within one tradition, and imposes formulaic solutions on ill defined problems.” within one tradition, and imposes formulaic solutions on ill defined problems.” The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools, and SocietiesThe Difference: How the Power of Diversity Creates Better Groups, Firms, Schools, and Societies,, Scott PageScott Page

“Diverse groups of problem solvers—groups of people with diverse tools—“Diverse groups of problem solvers—groups of people with diverse tools—consistently outperformed groups of the best and the brightest. If I formedconsistently outperformed groups of the best and the brightest. If I formed two groups, one random (and therefore diverse) and one consisting of the best two groups, one random (and therefore diverse) and one consisting of the best individual performers, the first group almost always did better. … Diversityindividual performers, the first group almost always did better. … Diversitytrumped ability.”trumped ability.” The Wisdom of CrowdsThe Wisdom of Crowds,, James SurowieckiJames Surowiecki

Full House: The Spread of Excellence from Plato to DarwinFull House: The Spread of Excellence from Plato to Darwin, , Stephen Jay GouldStephen Jay Gould

Judgment under Uncertainty: Heuristics and BiasesJudgment under Uncertainty: Heuristics and Biases, , Daniel Kahneman, Paul Slovic, and Amos TverskyDaniel Kahneman, Paul Slovic, and Amos Tversky

A Mind of Its Own: How Your Brain Distorts and DeceivesA Mind of Its Own: How Your Brain Distorts and Deceives, , Cordelia Fine Cordelia Fine “Your brain has some shifty “Your brain has some shifty habits that leave the truth distorted and disguised. Your brain is vainglorious. It’s habits that leave the truth distorted and disguised. Your brain is vainglorious. It’s emotional and immoral. It deludes you. It is pigheaded, secretive and weak willed. emotional and immoral. It deludes you. It is pigheaded, secretive and weak willed. Oh, and it’s also a bigot.” Oh, and it’s also a bigot.”

General David Petraeus’General David Petraeus’ “ “White lines along the road”:White lines along the road”:

““Secure and serve the population.Secure and serve the population. Live among the people.Live among the people. Promote reconciliation.Promote reconciliation. Move mounted, work dismounted;Move mounted, work dismounted; situational awareness can only besituational awareness can only be achieved by operating face-to-face,achieved by operating face-to-face, not separated by ballistic glass.not separated by ballistic glass.

WalkWalk..*”*” ——David Petraeus, David Petraeus, Men’s JournalMen’s Journal (06.08) (06.08)

* * “I love that last one for its simplicity.”“I love that last one for its simplicity.” —DP —DP

““I call 60 CEOs I call 60 CEOs [in [in

the first week of the year]the first week of the year] to to wish them happy wish them happy

New Year. …”New Year. …”

—Hank Paulson, former CEO, Goldman —Hank Paulson, former CEO, Goldman SachsSachs

Source: Fortune, “Secrets of Greatness,” 0320.05

You = Your You = Your calendarcalendar***Calendars *Calendars nevernever lielie

SellSell sell sell sellsell sellsell sell sell sell sell sell sell sellsell sell sell sell sell sellsell sell sell sell sell sellsell sellsell sellsell sell sell sell sell sell sell sellsell sellsell sellsell sell sell sell sell

sellsell sell sell sell sell

Listen.Listen.Talk. Talk.

Conrad Hilton, at a gala Conrad Hilton, at a gala celebrating his life,celebrating his life,

was asked, “What was the was asked, “What was the most important lesson most important lesson

you’ve learned in your long you’ve learned in your long and distinguished career?” and distinguished career?”

His immediate answer …His immediate answer …

““remember remember to tuck the to tuck the

shower curtain shower curtain inside the inside the bathtubbathtub””

#6.1#6.1

HHowardoward

HHiltonilton

HHerberb

Conrad Hilton, at a gala celebrating his life,Conrad Hilton, at a gala celebrating his life, was asked, “What was the most important lesson you’ve learned was asked, “What was the most important lesson you’ve learned

in your long and distinguished career?” in your long and distinguished career?”

His immediate answer: His immediate answer: ““remember remember to tuck the to tuck the

shower curtain shower curtain inside the inside the bathtubbathtub””

““You have to You have to treat your treat your

employees like employees like customers.”customers.” —Herb Kelleher, —Herb Kelleher,

upon being asked his “secret to success”upon being asked his “secret to success”

Source: Joe Nocera, Source: Joe Nocera, NYTNYT, “Parting Words of an Airline Pioneer,” , “Parting Words of an Airline Pioneer,” on the occasion of Herb Kelleher’s retirement after 37 years on the occasion of Herb Kelleher’s retirement after 37 years at Southwest Airlines (SWA’s pilots union took out a full-pageat Southwest Airlines (SWA’s pilots union took out a full-page ad in USA Today thanking HK for all he had done; across thead in USA Today thanking HK for all he had done; across the

way in Dallas American Airlines’ pilots were picketing theway in Dallas American Airlines’ pilots were picketing the Annual Meeting)Annual Meeting)

3H: Howard, Hilton, Herb3H: Howard, Hilton, Herb

****Stay in touch!Stay in touch!****Sweat theSweat the details! details!****It’s the people,It’s the people, stupid! stupid!

2-cent 2-cent candycandy

<TG<TGWWvs.vs.

>TG>TGRR

Master of “TGR” Cont.Master of “TGR” Cont.

Granite Rock CoGranite Rock Co.. ( (Cross it outCross it out if you think we did it poorly) if you think we did it poorly)

1/401/40

“ “one idea.”one idea.”1966-2008.1966-2008.

““We have a We have a ‘strategic plan.’ ‘strategic plan.’ It’s called It’s called doing doing thingsthings.”.” — Herb Kelleher

“This is so simple it sounds stupid, but it is amazing how few oil people really

understand that you only you only find oil if you find oil if you drill wellsdrill wells.. You may

think you’re finding it when you’re drawing maps and

studying logs, but you have to drill.”

Source: The Hunters, by John Masters, Canadian O & G wildcatter

““We made mistakes, of course. Most of them were We made mistakes, of course. Most of them were omissions we didn’t think of when we initially wrote the omissions we didn’t think of when we initially wrote the software. software. We fixed them by doing it over and over, again We fixed them by doing it over and over, again and again.and again. We do the same today. While our competitors We do the same today. While our competitors are still sucking their thumbs trying to make the design are still sucking their thumbs trying to make the design

perfect, we’re already on prototype versionperfect, we’re already on prototype version ##55..

By the time our rivals areBy the time our rivals are ready with wires and screws, we are on versionready with wires and screws, we are on version

##1010.. It gets back to It gets back to planning versus actingplanning versus acting: : We act We act from day onefrom day one; ; others plan how others plan how toto planplan——for monthsfor months.”.” —Bloomberg by —Bloomberg by

BloombergBloomberg

"I think it is very important "I think it is very important for you to do two things: for you to do two things: act on your temporary act on your temporary conviction as if it was a conviction as if it was a

real conviction; and when real conviction; and when you realize that you are you realize that you are

wrong, correct course very wrong, correct course very quickly.”quickly.” —Andy Grove—Andy Grove

““ExperimenExperiment t

fearlessly”fearlessly”Source: BW0821.06, Type A Organization Strategies/

“How to Hit a Moving Target”—Tactic #1Tactic #1

““Fail .Fail . Forward. Forward.

Fast.”Fast.”High Tech CEO, Pennsylvania

“Natural selection is death. ... Without huge amounts of death, organisms do not change over time. ...

Death is the mother of structure. ... It took four

billion years of death ... to invent the human mind ...” —

The Cobra Event

““FAIL, FAIL FAIL, FAIL AGAIN. FAIL AGAIN. FAIL BETTER.”BETTER.”

—Samuel Beckett

“The secret of fast progress is

inefficiency, fast and furious and

numerous failures.”

—Kevin Kelly

““RewardReward excellent failures.

PunishPunish mediocre

successes.”Phil Daniels, Sydney exec

““You miss You miss

100100%%

of the shots of the shots you never you never

take.”take.” —Wayne—Wayne GretzkyGretzky

““Intelligent people Intelligent people can always come up can always come up

with intelligent with intelligent reasons reasons to do to do nothingnothing.”.” —Scott Simon—Scott Simon

Excellence1982: The Bedrock “Eight Basics”

1. 1. A Bias for ActionA Bias for Action2. Close to the Customer2. Close to the Customer3. Autonomy and Entrepreneurship3. Autonomy and Entrepreneurship4. Productivity Through People4. Productivity Through People5. Hands On, Value-Driven5. Hands On, Value-Driven6. Stick to the Knitting6. Stick to the Knitting7. Simple Form, Lean Staff7. Simple Form, Lean Staff8. Simultaneous Loose-Tight Properties” 8. Simultaneous Loose-Tight Properties”

“ “one idea.”one idea.”1966-2008.1966-2008.

try it. Try it. Try it. Try try it. Try it. Try it. Try it. Try it. Try it. Try it. it. Try it. Try it. Try it. Try itTry it. . Screw it up.Screw it up. Try Try it. Try it. Try it. Try it. it. Try it. Try it. Try it. Try it. Try it.Try it. Try it. Screw it Screw it

up.up. it. Try it. Try it. try it. Try it. Try it. try it. Try it.it. Try it. Screw it up.Screw it up. Try it. Try it. Try it.Try it. Try it. Try it.

What “We” Know “For Sure” About Innovation

Big mergers Big mergers [by & large][by & large] don’t work don’t workScale is over-ratedScale is over-rated

Strategic planning is the last refuge of scoundrelsStrategic planning is the last refuge of scoundrelsFocus groups are counter-productiveFocus groups are counter-productive“Built to last” is a chimera (stupid)“Built to last” is a chimera (stupid)

Success killsSuccess kills“Forgetting” is impossible“Forgetting” is impossible

Re-imagine is a charming ideaRe-imagine is a charming idea“Orderly innovation process” is an oxymoronic phrase“Orderly innovation process” is an oxymoronic phrase

(= Believed only by morons with ox-like brains) (= Believed only by morons with ox-like brains)“Tipping points” are easy to identify …“Tipping points” are easy to identify … long after they will do you any good long after they will do you any good

“Facts” aren’t“Facts” aren’tAll information making it to the top is filteredAll information making it to the top is filtered

to the point of danger and hilarity to the point of danger and hilarity“Success stories” are the illusions of egomaniacs (and “gurus”)“Success stories” are the illusions of egomaniacs (and “gurus”)

If you believe the memoirs of CEOs you should be institutionalizedIf you believe the memoirs of CEOs you should be institutionalized“Herd behavior” (XYZ is “hot”) is ubiquitous“Herd behavior” (XYZ is “hot”) is ubiquitous

… and amusing … and amusing“Top teams” are “Dittoheads”“Top teams” are “Dittoheads”

“Expert” prediction is rarely better than rolling the dice“Expert” prediction is rarely better than rolling the dice

#8.1#8.1

Speed/ Tempo/Speed/ Tempo/o.o.d.a. loops/ o.o.d.a. loops/

“Metabolic “Metabolic Management”Management”

Messin’ with their Messin’ with their minds: He who has minds: He who has

the quickest the quickest “O.O.D.A. Loops”* “O.O.D.A. Loops”*

wins!wins!*Observe. Orient. Decide. Act. /Col. John Boyd

The The “Havlicek “Havlicek Principle”Principle”

John Havlicek, Boston Celtics, Basketball John Havlicek, Boston Celtics, Basketball

Hall of Fame:Hall of Fame: “He was out on the court “He was out on the court ALLALL THETHE TIMETIME [still among the top all-time in [still among the top all-time in

minutes played]minutes played] and he and he KEPTKEPT MOVINGMOVING, on , on offense and defense, offense and defense, ALLALL THETHE TIMETIME. .

This meant he was effective even This meant he was effective even against bigger or faster opponents—against bigger or faster opponents—

he he HARRIEDHARRIED ANDAND WORRIEDWORRIED THEMTHEM TO DEATHTO DEATH on both ends of the court.” on both ends of the court.”

Source: Tim Walker/tompeters.comSource: Tim Walker/tompeters.com

4/404/40

De-cent-De-cent-ral-iz-ral-iz-a-tion!a-tion!

“‘Decentralization’ is not a piece of paper. It’s not me. It’s either in

your heart, or not.”

—Brian Joffe/BIDvest

The True Logic* of Decentralization:

6 divisions = 6 “tries”6 divisions = 6 “tries”

6 divisions = 6 6 divisions = 6 DIFFERENTDIFFERENT leaders = 6 leaders = 6 INDEPENDENTINDEPENDENT

“tries” = Max probability of “tries” = Max probability of “win”“win”

6 divisions = 6 6 divisions = 6 veryvery DIFFERENT DIFFERENT leaders = 6 leaders = 6 veryvery INDEPENDENT INDEPENDENT

“tries” = Max probability of “tries” = Max probability of ““far outfar out”/””/”3-sigma3-sigma”” “win” “win”

*“Driver”: Law of Large #s

Enemy Enemy #1#1

I.C.D.I.C.D.Note 1:Note 1: Inherent/Inevitable/Inherent/Inevitable/Immutable Centralist DriftImmutable Centralist Drift

Note 2: Jim Burke’s 1-word vocabulary: “No.”Note 2: Jim Burke’s 1-word vocabulary: “No.”

Decentralization Decentralization vs Centralization vs Centralization

= “That’s = “That’s AllAll There Is”There Is” (from (from

childrearing 101 to the childrearing 101 to the Federalist PapersFederalist Papers to Org.2007)to Org.2007)

““Parallel Parallel Universe” …Universe” … China!!!!!!!China!!!!!!!

Ex-e-Ex-e-cu-cu-

tion!tion!

““ExecutionExecution is is thethe jobjob of the of the

businessbusiness leaderleader.”.” —Larry Bossidy—Larry Bossidy & Ram

Charan/ Execution: The Discipline of Getting Things Done

“Execution is a

systematic systematic processprocess of rigorously

discussing hows and whats, tenaciously following through, and

ensuring accountability.” —Larry Bossidy & Ram Charan/ Execution:

The Discipline of Getting Things Done

(1)(1) sum of Projects sum of Projects == Goal (“Vision”) Goal (“Vision”)

(2)(2) sum of sum of Milestones =Milestones = project project

(3)(3) rapid Review + rapid Review + Truth-telling = Truth-telling = accountability accountability

““almost inhuman almost inhuman disinterestedness disinterestedness in … strategy”in … strategy” —Josiah —Josiah

Bunting on Bunting on U.S. GrantU.S. Grant (from (from Ulysses S. Ulysses S. GrantGrant))

U. S. GrantU. S. Grant

*No interest in grand strategy.*No interest in grand strategy.*Do the thing until it is done.*Do the thing until it is done.*Do not over complicate.*Do not over complicate.*Do the next thing.*Do the next thing.*Pleasure in perseverance per se.*Pleasure in perseverance per se.*Not ask for help or advice.*Not ask for help or advice.*Not complain of difficulties or ask for*Not complain of difficulties or ask for more time or resources more time or resources

McClellan:McClellan: delay; plead for more forces delay; plead for more forcesGrant:Grant: “When do I start? What I want “When do I start? What I want is to advance.” is to advance.”

Source: Josiah Bunting, Source: Josiah Bunting, Ulysses S. GrantUlysses S. Grant

Drucker, Strategy, LeadershipDrucker, Strategy, Leadership

Classic DruckerClassic Drucker (from the (from the HBRHBR), ), 221 pages: “strategy,” 3 p 221 pages: “strategy,” 3 p (infotech); “leadership,” 0.(infotech); “leadership,” 0.

The Practice of ManagementThe Practice of Management, , 404 p: “strategy,” 0; 404 p: “strategy,” 0;

“leadership,” 3 p.“leadership,” 3 p.

ManagementManagement, 568 p: “strategy,” , 568 p: “strategy,” 8 p (all on systems, none on 8 p (all on systems, none on

content), “leadership,” 12 p. content), “leadership,” 12 p.

Excellence in Excellence in Execution = Execution =

Deepest Deepest “Blue “Blue

Ocean”Ocean”

Ac-count-Ac-count-a-bil-ity!a-bil-ity!

““Mr Zetsche, Mr Zetsche, head of head of

Chrysler from Chrysler from 2000 to 2005, 2000 to 2005,

denied he denied he shouldshould

take any take any responsibility responsibility

forfor the U.S. the U.S.

carmaker’scarmaker’s troubles …” troubles …” ——Financial Financial

TimesTimes /05.29.07 /05.29.07

““GE has set a GE has set a standard of candor. standard of candor.

… There is no … There is no puffery. … puffery. … There There isn’t an ounce of isn’t an ounce of

denial in the placedenial in the place.”.” —

Kevin Sharer, CEO Amgen, on the “GE mystique” (Fortune)

CF: CF: 30%30% (no (no

salesfolk)salesfolk)

MH: MH: 80%80% (salesfolk)(salesfolk)

SECDEF Bob Gates:SECDEF Bob Gates: Walter Reed, Army Walter Reed, Army Sec’y; Nucs, USAF Sec’y; Nucs, USAF

Sec’y & COSSec’y & COS

““Pay It Back If Pay It Back If You Didn’t You Didn’t

Earn It”Earn It” —headline, —headline, New New

York TimesYork Times, 0616.08, on 300 “clawback” , 0616.08, on 300 “clawback” provisions for execs, often when earnings re-provisions for execs, often when earnings re-

statements occurstatements occur

6:15A.M6:15A.M..

DECENTRALIZATIONDECENTRALIZATION..

EXECUTION.EXECUTION.ACCOUTABILITY.ACCOUTABILITY.

66:15A.M. :15A.M.

““But it’s But it’s only only

2am!”2am!”

““Where are you going? … But it’s Where are you going? … But it’s only 2am. … You see, you can live only 2am. … You see, you can live your life at 120 miles an hour, and your life at 120 miles an hour, and that’s pretty impressive. But it’s that’s pretty impressive. But it’s

not good enough. Unless you live at not good enough. Unless you live at 150 miles an hour, the world will 150 miles an hour, the world will

pass you by,” pass you by,” HRH Prince Alwaleed* HRH Prince Alwaleed*

*1 day: 573 people met separately, 200 phone calls, 100 text messages, etc*1 day: 573 people met separately, 200 phone calls, 100 text messages, etc

Source: “Prince Alwaleed, Inside the private world of the Middle East’sSource: “Prince Alwaleed, Inside the private world of the Middle East’s most powerful investor” cover story, most powerful investor” cover story, The BusinessThe Business, 0519.07, 0519.07

DECENTRALIZATIONDECENTRALIZATION..

EXECUTION.EXECUTION.ACCOUTABILITY.ACCOUTABILITY.

2a.m.2a.m.

#9.1#9.1

Excellence: The SE22Excellence: The SE22::

ORIGINS OF ORIGINS OF SUSTAINABLE SUSTAINABLE

ENTREPRENEURSHIP*ENTREPRENEURSHIP*

*Maybe*Maybe

SE22/Origins of Sustainable EntrepreneurshipSE22/Origins of Sustainable Entrepreneurship1. Genetically disposed to Innovations that upset apple carts 1. Genetically disposed to Innovations that upset apple carts (3M, Apple, (3M, Apple,

FedEx, Virgin, BMW, Sony, Nike, Schwab, Starbucks, Oracle, Sun,FedEx, Virgin, BMW, Sony, Nike, Schwab, Starbucks, Oracle, Sun, Fox, Stanford University, MIT)Fox, Stanford University, MIT)

2. Perpetually determined to outdo oneself, even to 2. Perpetually determined to outdo oneself, even to the detriment of today’s $$$ winners the detriment of today’s $$$ winners (Apple, Cirque du Soleil, Nokia, FedEx)(Apple, Cirque du Soleil, Nokia, FedEx)

3. Treat History as the Enemy 3. Treat History as the Enemy (GE)(GE)

4. Love the Great Leap/Enjoy the Hunt 4. Love the Great Leap/Enjoy the Hunt (Apple, Oracle, Intel, Nokia, Sony)(Apple, Oracle, Intel, Nokia, Sony)

5. Use “Strategic Thrust Overlays” to Attack Monster Problems 5. Use “Strategic Thrust Overlays” to Attack Monster Problems (Sysco, (Sysco, GSK, GE, Microsoft)GSK, GE, Microsoft)

6. Establish a “Be on the COOL Team” Ethos. 6. Establish a “Be on the COOL Team” Ethos. (Most PSFs, Microsoft)(Most PSFs, Microsoft)

7. Encourage Vigorous Dissent/Genetically “Noisy” 7. Encourage Vigorous Dissent/Genetically “Noisy” (Intel, Apple, (Intel, Apple, Microsoft, CitiGroup, PepsiCo)Microsoft, CitiGroup, PepsiCo)

8. 8. ““Culturally” as well as Culturally” as well as organizationally Decentralizedorganizationally Decentralized

(GE, J&J, Omnicom)(GE, J&J, Omnicom)

9. Multi-entrepreneurship/Many Independent-minded Stars 9. Multi-entrepreneurship/Many Independent-minded Stars (GE,(GE, PepsiCo)PepsiCo)

SE22/Origins of Sustainable Entrepreneurship

18. Unmistakable Results & Accountability focus from18. Unmistakable Results & Accountability focus from the get-go to the grave the get-go to the grave (GE, New York Yankees, PepsiCo)(GE, New York Yankees, PepsiCo)

19. 19. Up or OutUp or Out (GE, McKinsey, big consultancies and law (GE, McKinsey, big consultancies and law

firms and ad agencies and movie studios in general)firms and ad agencies and movie studios in general)

20. Competitive to a fault! 20. Competitive to a fault! (GE, New York Yankees, News(GE, New York Yankees, News Corp/Fox, PepsiCo)Corp/Fox, PepsiCo)

21. “Bi-polar” Top Team, with “Unglued” Innovator #1,21. “Bi-polar” Top Team, with “Unglued” Innovator #1, powerful Control Freak #2 powerful Control Freak #2 (Oracle, Virgin) (Watch out when(Oracle, Virgin) (Watch out when #2 is missing: Enron)#2 is missing: Enron)

22. Masters of Loose-Tight/Hard-nosed about a very few22. Masters of Loose-Tight/Hard-nosed about a very few Core Values, Open-minded about everything elseCore Values, Open-minded about everything else (Virgin)(Virgin)

#10#10

X X =XFX*=XFX*

**ExcellenceExcellence = Cross-functional Excellence = Cross-functional Excellence

The “XF-50”: 50 Ways The “XF-50”: 50 Ways to Enhance Cross-to Enhance Cross-

Functional Functional Effectiveness and Effectiveness and

Deliver Speed, Deliver Speed, “Service Excellence” “Service Excellence”

and “Value-added and “Value-added Customer ‘Solutions’”Customer ‘Solutions’”

1. 1. It’s our organization to make work—or not. It’s not “them,” the It’s our organization to make work—or not. It’s not “them,” the outside world that’s the problem. outside world that’s the problem. The enemy is us.The enemy is us. Period. Period.

2. Friction-free! Dump 90% of “middle managers”—most are advertent or inadvertent “power 2. Friction-free! Dump 90% of “middle managers”—most are advertent or inadvertent “power freaks.” We are all—every one of us—in the Friction Removal Business, one moment at a time, freaks.” We are all—every one of us—in the Friction Removal Business, one moment at a time, now and forevermore.now and forevermore.3. No “stovepipes”! “Stove-piping,” “Silo-ing” is an 3. No “stovepipes”! “Stove-piping,” “Silo-ing” is an Automatic Firing OffenseAutomatic Firing Offense. Period. No . Period. No appeals. (Within the limits of civility, somewhat “public” firings are not out of the question—that appeals. (Within the limits of civility, somewhat “public” firings are not out of the question—that is, make one and all aware why the axe fell.)is, make one and all aware why the axe fell.)4.4. Everything Everything on the Web. This helps. A lot. (“Everything” = Big word.)on the Web. This helps. A lot. (“Everything” = Big word.)5. Open access. All available to all. Transparency, beyond a level that’s “sensible,” is a de facto 5. Open access. All available to all. Transparency, beyond a level that’s “sensible,” is a de facto imperative in a Burn-the-Silos strategy.imperative in a Burn-the-Silos strategy.

6.6. Project managers rule!!Project managers rule!! Project managers running XF (cross- Project managers running XF (cross-functional) projects are the Elite of the organization, and seen as functional) projects are the Elite of the organization, and seen as such and treated as such. (The likes of construction companies such and treated as such. (The likes of construction companies have practiced this more or less forever.)have practiced this more or less forever.)

7. “Value-added Proposition” = Application of integrated resources. (From the entire supply-7. “Value-added Proposition” = Application of integrated resources. (From the entire supply-chain.) To deliver on our emergent business raison d’etre, and compete with the likes of our chain.) To deliver on our emergent business raison d’etre, and compete with the likes of our Chinese and Indian brethren, we must co-operate with anybody and everybody “24/7.” IBM, UPS Chinese and Indian brethren, we must co-operate with anybody and everybody “24/7.” IBM, UPS and many, many others are selling far more than a product or service that works—the new “it” and many, many others are selling far more than a product or service that works—the new “it” is pure and simple a product of XF co-operation; “the product is pure and simple a product of XF co-operation; “the product isis the co-operation” is not much the co-operation” is not much of a stretch.of a stretch.

Never Never waste a waste a lunch!*lunch!*

????????

% XF % XF lunches*lunches*

*Measure!*Measure!

#11#11

K.i.s.s.K.i.s.s.*Keep It Simple, Stupid*Keep It Simple, Stupid

Case: The Case: The “simple” “simple” Checklist!Checklist!

90K in U.S.A. 90K in U.S.A. ICUsICUs on any on any given day; given day; 178178 steps/day steps/day

in ICU. in ICU.

50%50% stays result stays result

in “serious complication”in “serious complication”

Source: Atul Gawande, “The Checklist” (Source: Atul Gawande, “The Checklist” (New YorkerNew Yorker, 1210.07), 1210.07)

****Peter PronovostPeter Pronovost, Johns Hopkins, , Johns Hopkins, 20012001**Checklist, line infections**Checklist, line infections**1/3**1/3rdrd at least one error when he started at least one error when he started**Nurses/permission to stop procedure **Nurses/permission to stop procedure if doc, other not following checklistif doc, other not following checklist**In 1 year, 10-day line-infection rate:**In 1 year, 10-day line-infection rate:

11% to … 11% to … 0%0%

Source: Atul Gawande, “The Checklist” (Source: Atul Gawande, “The Checklist” (New YorkerNew Yorker, 1210.07), 1210.07)

“Beware of the Beware of the tyranny of making tyranny of making SmallSmall

Changes to Changes to SSmallmall Things. Things.

Rather, make Rather, make BiBig g Changes to Changes to BiBigg

Things.”Things.” —Roger Enrico, former Chairman, —Roger Enrico, former Chairman,

PepsiCoPepsiCo

““Beware of the tyranny of making Beware of the tyranny of making SSmallmall Changes to Changes to

SSmallmall Things.Things. Rather, Rather, make make BigBig Changes to Changes to Big Big ThingsThings … …

using using Small, Almost Small, Almost Invisible Invisible

Straightforward Straightforward LeversLevers with with BiBigg

SSyystemic Imstemic Imppactact.”.” —TP—TP

““Everything matters”Everything matters”

-80%-80%Source:Source: Nudge,Nudge, Richard Thaler and Cass Richard Thaler and Cass

Sunstein, etching of fly in the urinalSunstein, etching of fly in the urinal reduces “spillage” by 80%, Schiphol Airportreduces “spillage” by 80%, Schiphol Airport

#11.1#11.1

Lisbon/New Biz:Lisbon/New Biz:

WeeksWeeks to …to …

Minutes Minutes (!!!!)(!!!!)

450/8450/8

First Steps: “Beauty Contest”!

1. Select one form/document: invoice, 1. Select one form/document: invoice, airbill, sick leave policy, customer airbill, sick leave policy, customer returns claim form.returns claim form.

2.2. Rate the selected doc on a scale of 1 to Rate the selected doc on a scale of 1 to 10 [1 = Bureaucratica Obscuranta/Sucks; 10 [1 = Bureaucratica Obscuranta/Sucks; 10 = Work of Art] on four dimensions:10 = Work of Art] on four dimensions:

BeautBeauty. y. GraceGrace. . ClaritClarity. y. SimplicitSimplicity.y.3. Re-invent!3. Re-invent!4.4. Repeat, with a new selection,Repeat, with a new selection, every 15 working days.every 15 working days.

Beauty Beauty Grace Grace

Clarity Clarity SimplicitySimplicity

“One bank is currently One bank is currently claiming to … claiming to …

‘leverage its global footprint to provide effective financial solutions for its customers by providing a

gateway to diverse markets.’”

——Charles HandyCharles Handy

“I assume that it is I assume that it is just saying that it isjust saying that it is

there tothere to ‘‘helhelpp its its customers customers

wherever thewherever theyy are’are’.”.”

—Charles Handy

““Seek honest, minimalist management. Seek honest, minimalist management. Look for companies run by a team that Look for companies run by a team that explains things clearly and briefly. … explains things clearly and briefly. …

You can tell a lot about the firm by You can tell a lot about the firm by

reading an annual report or two. reading an annual report or two. If If management can’t explain the management can’t explain the business in business in pplain English, move lain English, move

on to another firmon to another firm.. If you see If you see phrases like ‘creating knowledge-based phrases like ‘creating knowledge-based value in emerging markets’ … someone value in emerging markets’ … someone is trying to pull the wool over your eyes, is trying to pull the wool over your eyes, you lazy Fool. Run.” you lazy Fool. Run.” —Seth Jayson, “Stocks for the

Lazy Investor,” The Motley Fool

#12#12

TP: TP: “How to flush

$500,000 down

the toilet in one easy

lesson!!”

< CAPEX< CAPEX> People!> People!

Brand Brand = =

Talent.Talent.

Our Mission

To develop and manage To develop and manage talent;talent;

to apply that talent,to apply that talent,throughout the world, throughout the world,

for the benefit of clients;for the benefit of clients;to do so in partnership; to do so in partnership;

to do so with profit.to do so with profit.

WPP

#12.1#12.1

Organizations exist to serve. Period.Organizations exist to serve. Period.Leaders live to serve. Period.Leaders live to serve. Period.

Passionate servant leaders, determined to create a Passionate servant leaders, determined to create a legacy of earthshaking transformation in their domainlegacy of earthshaking transformation in their domain create/must create/must necessarilynecessarily create organizations which create organizations which

are …are … no less than Cathedrals in no less than Cathedrals in which the full and awesome which the full and awesome

power of the Imagination and power of the Imagination and Spirit and native Spirit and native

Entrepreneurial flairEntrepreneurial flair of of diverse individualsdiverse individuals is is

unleashedunleashed … … In passionate pursuit of jointly In passionate pursuit of jointly perceived soaring purposeperceived soaring purpose and personal and and personal and

community and client service Excellence. community and client service Excellence.

… … no less than no less than CathedralsCathedrals in which the full and in which the full and

awesome power of the awesome power of the Imagination and Spirit and Imagination and Spirit and native Entrepreneurial flairnative Entrepreneurial flair

of diverse individualsof diverse individuals is is unleashed in passionate unleashed in passionate pursuit of … Excellence.pursuit of … Excellence.

#12.2#12.2

Hire Hire ververy y good good

people!people!

“We believe companies can increase their market cap 50 percent in 3 years. Steve Macadam at Georgia-

Pacific … changed 2020 of his

4040 box plant managers to put more talented,

higher paid managers in charge. He increased profitability from

$$2525 million to $$8080 million in 22

years.”

—Ed Michaels, War for Talent

#12.3#12.3

PUT HR AT THE PUT HR AT THE HEAD OF THE HEAD OF THE HEAD TABLE. HEAD TABLE. BEST PEOPLE. BEST PEOPLE.

NOBLEST NOBLEST MISSION.MISSION.

#12.4#12.4

Organizing GeniusOrganizing Genius / Warren Bennis / Warren Bennis and Patricia Ward Biederman and Patricia Ward Biederman

“Groups become great only when “Groups become great only when everyone in them, leaders and everyone in them, leaders and

members alike, members alike, is free to do his or is free to do his or her absolute besther absolute best.”.”

“The best thing a leader can do for a “The best thing a leader can do for a

Great Group is to Great Group is to allow its allow its members to discover their members to discover their

ggreatnessreatness.”.”

Leaders’ “Mt Everest Test”Leaders’ “Mt Everest Test”

“free to do his or her “free to do his or her absolute best” …absolute best” …

“allow its members “allow its members to discover their to discover their

greatness.”greatness.”

““The role of the Director is to The role of the Director is to create a space where the actors create a space where the actors

and actresses canand actresses can become become more than they’ve ever more than they’ve ever been before, more than been before, more than

they’ve dreamed of they’ve dreamed of beingbeing.”.” —Robert Altman, Oscar acceptance speech—Robert Altman, Oscar acceptance speech

#12.5#12.5

Exec:Exec: “… but Tom, how do we find out “… but Tom, how do we find out what it is that people really want?”what it is that people really want?”

Tom (after a long pause and a lot of thoughtTom (after a long pause and a lot of thought——and I’m not kidding):and I’m not kidding):

““Ask Ask ‘em.”‘em.”

““The four most The four most important words in any important words in any

organizationorganization

are …are … ‘What do ‘What do you think?’you think?’ ” ”

Source: courtesy Dave Wheeler,Source: courtesy Dave Wheeler, posted at tompeters.com, source ofposted at tompeters.com, source of

original unknown (0609.08) original unknown (0609.08)

#12.6#12.6

EMPHASIZEMPHASIZE THE E THE “SOFT “SOFT

SKILLS.”SKILLS.”

#12.7#12.7

53 = 53 = 5353

#12.8#12.8

2/year 2/year = =

legacy.legacy.

#12.9#12.9

#1#1 cause of cause ofDis-satisfaction?Dis-satisfaction?

Employee retention & satisfaction:Employee retention & satisfaction: OverwhelminOverwhelmingglly, y, based on their based on their

immediateimmediate manamanaggerer!!

Source: Marcus Buckingham & Curt Coffman, Source: Marcus Buckingham & Curt Coffman, First, Break All First, Break All the Rules: the Rules:

What the World’s Greatest Managers Do DifferentlyWhat the World’s Greatest Managers Do Differently

#12.10#12.10

““Leaders Leaders

‘‘dodo’’ people. people.

Period.”Period.” —Anon.

““The leaders of Great The leaders of Great

Groups Groups lovelove talent talent and know where to find and know where to find

it. They it. They revel revel in the in the talent of others.”talent of others.”

—Warren Bennis & Patricia Ward Biederman, —Warren Bennis & Patricia Ward Biederman, Organizing Organizing GeniusGenius

PARC’s Bob Taylor:

“Connoisseur “Connoisseur of Talent”of Talent”

(from Warren Bennis & Patricia Ward Biederman, (from Warren Bennis & Patricia Ward Biederman, Organizing Genius)Organizing Genius)

#12.11#12.11


‘‘SERVESERVE’’ people. people.

Period.”Period.” —inspired by Robert Greenleaf

““No matter what the No matter what the situation, situation, [the great manager’s][the great manager’s]

first resfirst respponse is alwaonse is alwayys to s to think about the individual think about the individual concerned and how thinconcerned and how thinggs s can be arrancan be arrangged to ed to helhelpp

that individual exthat individual expperience erience successsuccess.”.” —Marcus Buckingham, —Marcus Buckingham,

The One Thing You Need to KnowThe One Thing You Need to Know

““I have always I have always believed that the believed that the

purpose of the purpose of the corporation is to be a corporation is to be a

blessing to the blessing to the employees.”employees.” * * —Boyd Clarke—Boyd Clarke

*TP: An “organization” is, in fact and after all*TP: An “organization” is, in fact and after all is said and done, a/the “house” in which is said and done, a/the “house” in which

most of us “live” most of the time. most of us “live” most of the time.

#12.12#12.12

““Every child is Every child is born an artist. born an artist. The trick is to The trick is to

remain an artistremain an artist.”.” —Picasso—Picasso

#13#13

Single Single greatest act greatest act

of pure of pure imaginationimagination

24%24%

dubaidubai

No Wiggle Room!No Wiggle Room!

“Incrementalis“Incrementalism is m is

innovation’s innovation’s worstworst enemy.” enemy.”

—Nicholas Negroponte—Nicholas Negroponte

3M’s Innovation3M’s Innovation Crisis: How Six Crisis: How Six Sigma Almost Sigma Almost

SmotheredSmothered Its Idea Culture Its Idea Culture

Source: Title/Cover Story, Source: Title/Cover Story, BWBW, 0611.07 (, 0611.07 (“What’s remarkable is “What’s remarkable is how fast a culture can be torn apart,”how fast a culture can be torn apart,” 3M lead scientist; “In 3M lead scientist; “In

an innovation economy, [6 Sigma] is no longer a cure all”/ an innovation economy, [6 Sigma] is no longer a cure all”/BWBW))

#14#14

““Do one Do one thing every thing every

day that day that scares you.”scares you.”

—Eleanor Roosevelt

Kevin Roberts’ CredoKevin Roberts’ Credo

11. Ready. Fire! Aim.. Ready. Fire! Aim.2. If it ain’t broke ... Break it!2. If it ain’t broke ... Break it!3. Hire crazies.3. Hire crazies.4. Ask dumb questions.4. Ask dumb questions.5. Pursue failure.5. Pursue failure.6. Lead, follow ... or get out of the way!6. Lead, follow ... or get out of the way!7. Spread confusion.7. Spread confusion.8. Ditch your office.8. Ditch your office.9. Read odd stuff.9. Read odd stuff.

10. Avoid moderationAvoid moderation!!

Stay Hungry. Stay Hungry. Stay Foolish.Stay Foolish.

Steve JobsSteve Jobs

#15#15

We We areare the the companycompany we keepwe keep

The “Hang Out Axiom”:The “Hang Out Axiom”: At its core, At its core, evereveryy (!!!) (!!!)

relationship-partnership relationship-partnership decision (employee, decision (employee,

vendor, customer, etc)vendor, customer, etc) is a is a stratestrateggicic decision decision

about: about:

“Innovate,“Innovate, ‘Yes’ or ‘Yes’ or ‘No’‘No’ ” ”

Measure “Strangeness”/Portfolio QualityMeasure “Strangeness”/Portfolio Quality

StaffStaffConsultantsConsultants

VendorsVendorsOut-sourcing Partners Out-sourcing Partners (#, Quality)(#, Quality)

Innovation Alliance PartnersInnovation Alliance PartnersCustomersCustomers

Competitors Competitors (who we “benchmark” against)(who we “benchmark” against)

Strategic Initiatives Strategic Initiatives Product Portfolio Product Portfolio (LineEx v. Leap)(LineEx v. Leap)

IS/IT ProjectsIS/IT ProjectsHQ LocationHQ LocationLunch MatesLunch Mates

LanguageLanguageBoardBoard

CUSTOMERS: “Future-“Future-defining customers defining customers

may account for only may account for only 2%2% to to 3%3% of your total, of your total, but they represent a but they represent a

crucial window on crucial window on the future.”the future.”

Adrian Slywotzky, Mercer Consultants

Axiom: Never use a vendor who is not in the

top quartiletop quartile (decile?) in their industry on R&D

spending!*

*Inspired by Hummingbird

““Normal” Normal”

= = “o “o forfor 800”800”

““Freak Freak Fridays”Fridays” —once a —once a

month invite somebody interesting, in any field, to have month invite somebody interesting, in any field, to have lunch with your ganglunch with your gang

““We are crazy. We should do We are crazy. We should do something when people say it is something when people say it is

‘crazy.’‘crazy.’ If people say If people say something is ‘good’, it something is ‘good’, it means someone else means someone else is already doing it.”is already doing it.”

—Hajime Mitarai, Canon—Hajime Mitarai, Canon

15.115.1

Gary Hamel says …Gary Hamel says …

“The The Bottleneck Bottleneck

Is at the Top Is at the Top of the of the

Bottle”Bottle”“Where are you likely to find people with the least diversity of

experience, the largest investment in the past, and the greatest reverence for industry dogma:

AtAt thethe totop!”p!”

— Gary Hamel/Harvard Business Review

#16#16

Hard Is SoftHard Is SoftSoft Is HardSoft Is Hard

Hard Is Hard Is SoftSoft (Plans, (Plans, ##ss))

Soft Is Soft Is HardHard (people, (people, customers, values, customers, values,

relationships))relationships))

“If I could have chosen not to tackle the IBM culture head-on, I probably wouldn’t have. My bias coming in was toward strategy, analysis and measurement. In comparison, changing the attitude and behaviors of

hundreds of thousands of people is very, very hard. [Yet] I came to see in my time at IBM that culture

isn’t just one aspect of the

game ——it is the it is the gamegame.”.” —Lou Gerstner,

Who Says Elephants Can’t Dance

#16.1#16.1

R.O.I.RR.O.I.R..

RReturn eturn OOn n

IInvestment In nvestment In

RRelationshipselationships

““The capacity to develop close and The capacity to develop close and enduring relationships is the mark of enduring relationships is the mark of a leader. Unfortunately, many leaders a leader. Unfortunately, many leaders of major companies believe their job of major companies believe their job is to create the strategy, organization is to create the strategy, organization

structure and organizational structure and organizational processes—then they just delegate processes—then they just delegate

the work to be done, remaining aloof the work to be done, remaining aloof from the people doing from the people doing

the work.”the work.” —Bill George, —Bill George, Authentic LeadershipAuthentic Leadership

#16.2#16.2

Q/Systems Salesperson:Q/Systems Salesperson: “I make the “I make the sale, and then the company screws up sale, and then the company screws up the engineering or delivery or one of a the engineering or delivery or one of a dozen things. Any suggestions?dozen things. Any suggestions?

A/TP:A/TP: “Spend less “Spend less time with your time with your customers!”customers!”

C(I)>C(C(I)>C(E)E)

??????????????


of people you know in of people you know in hihigghh places!”places!”

oror


of people you know in of people you know in lowlow places!” places!”

Loser:Loser: “He’s such a“He’s such a suck-up!” suck-up!”

Winner:Winner: “He’s such a“He’s such a suck-down.” suck-down.”

#16.3#16.3

Relationships (of all varieties): THERE THERE ONCE WAS A TIME WHEN A ONCE WAS A TIME WHEN A

THREETHREE--MINUTEMINUTE PHONEPHONE CALLCALL WOULD HAVE AVOIDED WOULD HAVE AVOIDED

SETTING OFF THE DOWNWARD SETTING OFF THE DOWNWARD SPIRAL THAT RESULTED IN A SPIRAL THAT RESULTED IN A

COMPLETE RUPTURE.COMPLETE RUPTURE.

THE PROBLEM IS THE PROBLEM IS RARELY/NEVER THE RARELY/NEVER THE

PROBLEM.PROBLEM. THE THE RESPONSE TO THE RESPONSE TO THE

PROBLEM INVARIABLY PROBLEM INVARIABLY ENDS UP BEING THE ENDS UP BEING THE

REAL PROBLEMREAL PROBLEM.

““I screwed I screwed up.”*up.”*

*The virtuous “circle of blame*The virtuous “circle of blame

#16.4#16.4

““Courtesies of a small Courtesies of a small and trivial character are and trivial character are

the ones which strike the ones which strike deepest in the grateful deepest in the grateful

and appreciating heart.”and appreciating heart.”

—Henry Clay

The Manager’s The Manager’s Book of Book of DecenciesDecencies: :

How Small How Small /gestures Build /gestures Build

Great Companies.Great Companies. —Steve Harrison, Adecco

““The The [Union senior][Union senior] officers rode past the officers rode past the Confederates smugly without any sign Confederates smugly without any sign of recognition except by one. ‘When of recognition except by one. ‘When

General Grant reached the line of General Grant reached the line of ragged, filthy, bloody, despairing ragged, filthy, bloody, despairing

prisoners strung out on each side of prisoners strung out on each side of the bridge, he lifted his hat and held it the bridge, he lifted his hat and held it over his head until he passed the last over his head until he passed the last man of that living funeral cortege. He man of that living funeral cortege. He was the only officer in that whole train was the only officer in that whole train

who recognized us as being on the who recognized us as being on the face of the earth.’*”face of the earth.’*”

*quote within a quote from diary of a Confederate soldier

““It was much later that I realized It was much later that I realized Dad’s secret. He gained respect by Dad’s secret. He gained respect by giving it. He talked and listened to giving it. He talked and listened to

the fourth-grade kids in Spring Valley the fourth-grade kids in Spring Valley who shined shoes the same way he who shined shoes the same way he talked and listened to a bishop or a talked and listened to a bishop or a

college president.college president. He was He was seriously interested in seriously interested in

who you were and what who you were and what you had to sayyou had to say.”.”Sara Lawrence-Lightfoot, Respect

#16.5#16.5

Politics Politics politics politics politics politics politics politics politicspolitics politics politics politics politics politics politics politics politics politics politics politicspolitics politics politics politics politics politicspolitics politics politics politics politics politicspolitics politics politics politicspolitics politics politics

politicspolitics

love it or love it or leave it!leave it!

#17#17

A pox on A pox on “micro-“micro-marketimarketi

ng”ng”

Who buys “it” I: Who buys “it” I: Sunset for men! Sunset for men!

““Forget Forget ChinaChina, , IndiaIndia and the and the

InternetInternet: Economic : Economic Growth Is Driven Growth Is Driven

by by WomenWomen.”.” —Headline,

Economist, April 15, 2006, Leader, page 14

““Women Women areare thethe

majority majority market”market”

—Fara Warner/—Fara Warner/The Power of the PurseThe Power of the Purse

““Goldman Sachs in Tokyo has Goldman Sachs in Tokyo has developed an index of 115 developed an index of 115

companies poised to benefit companies poised to benefit from women’s increased from women’s increased

purchasing power; purchasing power; over the past over the past decade the value of shares in decade the value of shares in Goldman’s basket has risen by Goldman’s basket has risen by

96%, against the Tokyo 96%, against the Tokyo stockmarket’s rise stockmarket’s rise

of 13%of 13%.”.” —Economist, April 15

#17.1#17.1

““AS AS LEADERS, LEADERS, WOMEN WOMEN

RULERULE:: New Studies find

that female managers outshine their male counterparts in almost every measure”

TITLE/ Special Report/ TITLE/ Special Report/ BusinessWeekBusinessWeek

#17.1.1#17.1.1

Women’s NeWomen’s Neggotiatinotiatingg Stren Strenggthsths

*Ability to put themselves in their *Ability to put themselves in their counterparties’ shoes counterparties’ shoes*Comprehensive, attentive and detailed*Comprehensive, attentive and detailed communication style communication style*Empathy that facilitates trust-building*Empathy that facilitates trust-building*Curious and attentive listening*Curious and attentive listening*Less competitive attitude*Less competitive attitude*Strong sense of fairness and ability to *Strong sense of fairness and ability to persuadepersuade*Proactive risk manager*Proactive risk manager*Collaborative decision-making*Collaborative decision-making

Source: Horacio Falcao, Cover story/May 2006, World Business, “Say It Like a Woman: Why the 21st-century negotiator will need the female touch”

““[Women] see power[Women] see power in terms of in terms of influence, influence,

not rank.”not rank.” ——FortuneFortune

““Guys want to put everybody inGuys want to put everybody in their hierarchical place. Like, their hierarchical place. Like, should I have more respect forshould I have more respect for

you, or are you somebody that’s you, or are you somebody that’s south of me?”south of me?” —Paul Biondi, Mercer Consultants—Paul Biondi, Mercer Consultants

[from [from It’s Not Business, It’s PersonalIt’s Not Business, It’s Personal, Ronna Lichtenberg], Ronna Lichtenberg]

Bob Reich’s women Bob Reich’s women

students:students: “No “No worries.”worries.”**

*Men: “Can’t do it. _____ outranks me.”*Men: “Can’t do it. _____ outranks me.”

“There is always an easy solution to

every human problem—neat,

plausible, and … wrong.” —H.L. Mencken:

Mrs Coach KMrs Coach K

#17.1.2#17.1.2

For projects involving children For projects involving children or health or education or or health or education or

community development or community development or sustainable small-businesssustainable small-business

growth (most projects),growth (most projects),

womenwomen are by far the are by far the

most reliablemost reliable and most central and most central and most indirectly powerful and most indirectly powerful locallocal players even in the most players even in the most

chauvinist settings. chauvinist settings.

94%94%

#17.2#17.2

Who buys “it” II:Who buys “it” II:

Sunrise for old folks!Sunrise for old folks!

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!““People turning 50 People turning 50

today have today have more more thanthan halfhalf of of their adult life their adult life

ahead of them.”ahead of them.” —Bill

Novelli, 50+: Igniting a Revolution to Reinvent America

7/17/133

““Sixty Is Sixty Is the New the New Thirty”Thirty”

—Cover/—Cover/AARPAARP

““EIGHTY EIGHTY IS THE IS THE NEW NEW

FIFTY”FIFTY”

—Headline, Newsweek, 0616.08—Headline, Newsweek, 0616.08

We are the We are the Aussies & Kiwis &Aussies & Kiwis & Americans & Americans & CanadiansCanadians. We are the . We are the Western EuropeansWestern Europeans & & JapaneseJapanese. We are the . We are the fastest growingfastest growing, , the the biggestbiggest, the , the wealthiestwealthiest, the , the boldestboldest, ,

the most (yes) the most (yes) ambitiouambitious, the most s, the most experimental & exploratoryexperimental & exploratory, the most , the most

differentdifferent, the most , the most indulgentindulgent, the most , the most difficult &difficult & demandingdemanding, the most , the most service & service & experience obsessedexperience obsessed, the most , the most vigorousvigorous, ,

(the (the leastleast vigorous,) the most vigorous,) the most health health consciousconscious, the most , the most femalefemale, the most , the most

profoundly important commercial market in profoundly important commercial market in the history of the world—and we will be the the history of the world—and we will be the Center of your universe for the next Center of your universe for the next twenty-twenty-

fivefive yearsyears. We have arrived!. We have arrived!

#18#18

Up, Up, Up,

Up

the Value-added Ladder.

Auckland/pmAuckland/pmtaipei/vptaipei/vp

singapore/pmsingapore/pmbangkok/dpmbangkok/dpm

flandersflandersamsterdam/MPamsterdam/MPss

barcelona/mbarcelona/maa

Kuala Lumpur/CMKuala Lumpur/CMlisbon/mlisbon/maa

dublin/pmdublin/pmbuenos airesbuenos aires

sao paulosao pauloWarsaw/MPWarsaw/MPss

london/mplondon/mpss

milanmilanSEOUL/MSEOUL/Maa

mexico d.f./mmexico d.f./mistanbul/dpmistanbul/dpm

dubai/rfmdubai/rfmoman/rfmoman/rfm

usausastockholm/mpstockholm/mpss

shanghaishanghaimauritius/pmmauritius/pmjohannesburgjohannesburgbucharest/CMbucharest/CM

EXCELLENCE.EXCELLENCE.

VALUE ADDED. VALUE ADDED.UP THE LADDER.UP THE LADDER.

NoT Optional.NoT Optional.

The Value-added Ladder/ The Value-added Ladder/ “BEDROCK” “BEDROCK”

Raw Materials*Raw Materials*

**Farmers and Miners (“Degree”: Weightlifting)Farmers and Miners (“Degree”: Weightlifting)

The Value-added Ladder/ The Value-added Ladder/ THINGSTHINGS

Goods*Goods* Raw MaterialsRaw Materials

**Engineers and Factory Workers (Degree: Engineering)Engineers and Factory Workers (Degree: Engineering)

The Value-added Ladder/TRANSACTIONSTRANSACTIONS

Services*Services*GoodsGoods

Raw Materials Raw Materials

**Clerks (Degree: Process Engineering)Clerks (Degree: Process Engineering)

#18.1#18.1


VALUE-ADDED LADDER I.VALUE-ADDED LADDER I. SOLVE IT. SOLVE IT.

IBIBMM: : $55B*$55B*

*Also HP-EDS*Also HP-EDS

““THE GIANT STALKING BIG OIL: THE GIANT STALKING BIG OIL:

How How SchlumbergerSchlumberger Is Rewriting the Rules of the Is Rewriting the Rules of the

Energy Game.”:Energy Game.”: “IPM [Integrated “IPM [Integrated Project Management] strays from Project Management] strays from [Schlumberger’s] traditional role [Schlumberger’s] traditional role as a service provider and moves as a service provider and moves

deeper into areas once dominated deeper into areas once dominated by the majors.”by the majors.”

Source: Source: BusinessWeekBusinessWeek cover story, January 2008 cover story, January 2008

IBMIBMHPHP

SchlumbergerSchlumbergerGE EnergyGE Energy

GE InfrastructureGE InfrastructureUPSUPS

MasterCardMasterCardetcetcetcetcetcetcetcetc

HuHuggee:: Customer

SatisfactionSatisfaction versus Customer

SuccessSuccess

The Value-added Ladder/The Value-added Ladder/TRANSFORMATIONTRANSFORMATION

Customer Success/ Customer Success/ Gamechanging Gamechanging

SolutionsSolutions

ServicesServicesGoodsGoods


#18.1.1#18.1.1


SOLVE IT.SOLVE IT. NO OPTION. NO OPTION.

PSF. PSF.

““support function” / support function” / “cost center”/ “cost center”/ “overhead”“overhead”

oror … …

Department Head

to …

ManaginManaging g

PartnerPartner, , ISIS [HR, R&D, etc.] IncInc..

“Purchasing Officer” Thrust #1: Cost (at All Costs*) Minimization

Professional? Or/to: FullFull Partner-Partner-Leader in Lifetime Leader in Lifetime

Value-added Value-added MaximizationMaximization?

(*Lopez: “Arguably ‘Villain #1’ in GM tragedy”/Anon VSE-Spain)

Up,Up, Up,Up, Up, Up,

UpUp


#18.2#18.2


VALUE-ADDED LADDER II.VALUE-ADDED LADDER II. EXPERIENCE IT. EXPERIENCE IT.

Experience: “Rebel Lifestyle!”

“What we sell is the “What we sell is the ability for a 43-year-old ability for a 43-year-old accountant to dress in accountant to dress in

black leather, ride black leather, ride through small towns and through small towns and

have people be afraidhave people be afraid of him.” of him.”

HarleyHarley exec, quoted in Results-Based Leadership

The Value-added Ladder/ The Value-added Ladder/ MEMORABLE CONNECTIONMEMORABLE CONNECTION

Spellbinding Experiences Spellbinding Experiences **Customer Success/Customer Success/

Implemented Gamechanging SolutionsImplemented Gamechanging SolutionsServicesServicesGoodsGoods


**Blending Beauty, Usability, Theatricality (Degree: MFA/Blending Beauty, Usability, Theatricality (Degree: MFA/Master of Fine Arts, “D-school,” Cultural Anthropology)Master of Fine Arts, “D-school,” Cultural Anthropology)

““You You knowknow a a designdesign is is goodgood

whenwhen you you wantwant to to licklick it.” it.” —Steve Jobs—Steve Jobs

Source: Source: Design: Intelligence Made VisibleDesign: Intelligence Made Visible,, Stephen Bayley & Terence ConranStephen Bayley & Terence Conran

#18.3#18.3


VALUE-ADDED LADDER III.VALUE-ADDED LADDER III.

DREAM IT.DREAM IT.

Furniture vs. Dreams

“We do not sell ‘furniture’ at

Domain. We sell We sell dreamsdreams. This is

accomplished by addressing the half-formed needs in our

customers’ heads. By uncovering these needs, we, in essence, fill in the blanks. We

convert ‘needs’ into ‘dreams.’ Sales are the

inevitable result.” — Judy George,

Domain Home Fashions

The Value-added Ladder/ EMOTIONEMOTION

Dreams Come True*Dreams Come True*Design-driven Spellbinding

Experiences Customer Success/Implemented

Gamechanging SolutionsServicesGoods

Raw Materials

**Psychologists (Degree: Psychology)Psychologists (Degree: Psychology)

#18.4#18.4


VALUE-ADDED LADDER III.VALUE-ADDED LADDER III.

ALL YOU NEED IS ALL YOU NEED IS LOVE.LOVE.

Kevin Roberts:

LovemarLovemar

ksks!!

Tattoo BrandTattoo Brand: What % of users would tattoo the brand name on their

body?

Top 10 “Tattoo Brands”*

Harley .… 18.9%Harley .… 18.9%Disney .... 14.8Disney .... 14.8

Coke …. 7.7Coke …. 7.7Google .... 6.6Google .... 6.6Pepsi .... 6.1Pepsi .... 6.1Rolex …. 5.6Rolex …. 5.6Nike …. 4.6Nike …. 4.6

Adidas …. 3.1Adidas …. 3.1Absolut …. 2.6Absolut …. 2.6

Nintendo …. 1.5Nintendo …. 1.5

*BRANDsense: Build Powerful Brands through Touch, Taste, Smell, Sight, and Sound, Martin Lindstrom

Top 10 “Tattoo Brands”*

Harley .… 18.9%Disney .... 14.8

Coke …. 7.7Google .... 6.6Pepsi .... 6.1Rolex …. 5.6

Bunge … ??Bunge … ??Nike …. 4.6

Adidas …. 3.1Absolut …. 2.6

Nintendo …. 1.5

*BRANDsense: Build Powerful Brands through Touch, Taste, Smell, Sight, and Sound, Martin Lindstrom


UpUp


The Value-added Ladder/ The Value-added Ladder/ ECSTASYECSTASY

Lovemark*Lovemark* Dreams Come True/Dreams Come True/

Best Story WinsBest Story Wins Spellbinding Experiences/ Spellbinding Experiences/

“Soul” Through Design“Soul” Through DesignCustomer Success/Implemented Customer Success/Implemented

Gamechanging SolutionsGamechanging SolutionsServicesServicesGoodsGoods

Raw MaterialsRaw Materials

**Passion (Degree: ????)Passion (Degree: ????)


UpUp


#18.5#18.5

4/74/7

Ladder.2008: 4 of Ladder.2008: 4 of 7!7!

Lovemark Lovemark Dreams Come TrueDreams Come True

Spellbinding Experiences Spellbinding ExperiencesGamechanging SolutionsGamechanging Solutions

ServicesServicesGoodsGoods

Raw MaterialsRaw Materials

#18.6#18.6

EXCELLENCE. EXCELLENCE. DOES MATTER DOES MATTER

MATTER?MATTER?

““What Isn’t What Isn’t Matter Is Matter Is

What What Matters”Matters”

—section title, Branded Nation: The Marketing of Megachurch, College Inc., and Museumworld, James Twitchell

VA “Teaching Moment”

““Andy pointed to Andy pointed to a molding, about a molding, about halfway up the halfway up the

wall …”wall …”

The The BootBoot … and … and TimberlandTimberland

The The TomatoTomato// FarmerFarmer … and … and

Campbell’sCampbell’s

Ladder.2008: 4 of Ladder.2008: 4 of 7!7!

Lovemark Lovemark Dreams Come TrueDreams Come True

Spellbinding Experiences Spellbinding ExperiencesGamechanging SolutionsGamechanging Solutions

ServicesGoods

Raw Materials

#19#19

New Old New Old BasicsBasics

Lessons Learned 42/1966-2008Lessons Learned 42/1966-2008

****DecentralizationDecentralization****AccountabilityAccountability****Wild-ass imaginationWild-ass imagination****Human developmentHuman development****XFX (Cross-functional Excellence)XFX (Cross-functional Excellence)****Untapped MarketsUntapped Markets****Value-added fanaticismValue-added fanaticism****Base Principles IBase Principles I****Base Principles IIBase Principles II****Base Principles IIIBase Principles III

****LeadershipLeadership

DecentralizationDecentralization USA: Constitution, 50 states, immigrant nation (>50% Silicon Valley), USA: Constitution, 50 states, immigrant nation (>50% Silicon Valley), independent-minded (students “no respect teachers”), entrepreneurial, independent-minded (students “no respect teachers”), entrepreneurial, Energizer Bunny (Zakaria—1960/26%, 1980/22%, 2000/27%, 2007/26%), Energizer Bunny (Zakaria—1960/26%, 1980/22%, 2000/27%, 2007/26%), pragmatic (Rommel), relatively unregulated market economy pragmatic (Rommel), relatively unregulated market economy Research via wildly competitive universities Research via wildly competitive universities William Easterly, economic development (“trust the development experts William Easterly, economic development (“trust the development experts —all seven billion of them”) —all seven billion of them”) J&J/DePuy (Decentralization as decentralization was meant to be) J&J/DePuy (Decentralization as decentralization was meant to be) More “statistically independent tries” (if “independent” holds) More “statistically independent tries” (if “independent” holds) Focus! (Focus pays.) Focus! (Focus pays.) “Economies of scale” run out (much) earlier than we think “Economies of scale” run out (much) earlier than we think Focus: on the “lowest operating unit”: retail store-district; union and 250- Focus: on the “lowest operating unit”: retail store-district; union and 250- person distribution center, call center; parish person distribution center, call center; parish Spread ideas via “go see this-these demos” (infection through “best practices” Spread ideas via “go see this-these demos” (infection through “best practices” rather than central edict); innovation by prototyping anywhere and rather than central edict); innovation by prototyping anywhere and everywhere (e.g., “the 1% rule”); innovation by “parallel universe” everywhere (e.g., “the 1% rule”); innovation by “parallel universe” (mgt ed new via autonomous exec ed “division”—main body conservative- (mgt ed new via autonomous exec ed “division”—main body conservative- recalcitrant; Jill Ker Conway @ Smith—new money sources for new people recalcitrant; Jill Ker Conway @ Smith—new money sources for new people andand new programs) new programs) “You own the damn place; no bullshit excuses” (i.e., Major Consequences “You own the damn place; no bullshit excuses” (i.e., Major Consequences —up & down) —up & down) “No such thing as ‘Scalability’” “No such thing as ‘Scalability’” Limits to “synergy” Limits to “synergy” Power of “no” (Jim Burke Rule—e.g., no centralization following screw-up, Power of “no” (Jim Burke Rule—e.g., no centralization following screw-up, in 9 of 10 cases, even after major boo-boo) in 9 of 10 cases, even after major boo-boo) “‘Decentralization’ is not a piece of paper. It’s not me. It’s either in your heart, “‘Decentralization’ is not a piece of paper. It’s not me. It’s either in your heart, or not.”—Brian Joffe/BIDvest or not.”—Brian Joffe/BIDvest

AccountabilityAccountability “30%-80% rule”—own your budget (Mark Hurd-HP) “30%-80% rule”—own your budget (Mark Hurd-HP) Make a promise keep a promise (GE, Milliken) Make a promise keep a promise (GE, Milliken) Optimism but honesty Optimism but honesty No: “Kill the messenger” No: “Kill the messenger” Transparency Transparency Starts at the top!!!!!!!! (Bob Gates and Walter Reed-USAF) Starts at the top!!!!!!!! (Bob Gates and Walter Reed-USAF) Fragile??? Fragile??? Clear expectations at the time of hiring Clear expectations at the time of hiring Self-responsibility Self-responsibility Decency-culture of respect Decency-culture of respect

Wild-ass imaginationWild-ass imagination “Dubai rule” “Dubai rule” Hang out with freaks as a matter of course (lead customers, small-but-hot Hang out with freaks as a matter of course (lead customers, small-but-hot vendors, odd backgrounds, etc, etc—more or less measured) vendors, odd backgrounds, etc, etc—more or less measured) Wee “cool” acquisitions (hold on to founders at all costs—Disney and Pixar and Wee “cool” acquisitions (hold on to founders at all costs—Disney and Pixar and Jobs on Board; Cisco) Jobs on Board; Cisco) Measure division-level bosses on “crazy-assed experiments” (plus Wexner Rule— Measure division-level bosses on “crazy-assed experiments” (plus Wexner Rule— no screw-ups is Black Mark); and Daniels Rule—”Reward excellent failures, no screw-ups is Black Mark); and Daniels Rule—”Reward excellent failures, punish mediocre successes” (!!!) punish mediocre successes” (!!!) Failure tolerated-encouraged (“He who makes the most mistakes wins”) Failure tolerated-encouraged (“He who makes the most mistakes wins”) 5-year Blockbuster Initiatives with major consequences (Demo-driven) 5-year Blockbuster Initiatives with major consequences (Demo-driven) Diversity for creativity (bottom to top) Diversity for creativity (bottom to top) Decentralization with teeth Decentralization with teeth Accountability (“Dreamers with deadlines”) Accountability (“Dreamers with deadlines”) World-class research universities World-class research universities Government support for R&D (computers, Internet, biotech) Government support for R&D (computers, Internet, biotech)

Human developmentHuman development “Cathedral model” (“This is what we do”) “Cathedral model” (“This is what we do”) WPP Mission WPP Mission HR (GE model); Chief Human Development Officer (post-cop world) HR (GE model); Chief Human Development Officer (post-cop world) “You will be measured on Human Development Effectiveness” (e.g., how many “You will be measured on Human Development Effectiveness” (e.g., how many folks go on to be promoted at least two levels, or are headhunted) folks go on to be promoted at least two levels, or are headhunted) Resilience—XP/eXtreme Preparation (Black Swan world) Resilience—XP/eXtreme Preparation (Black Swan world) “Character” “Character” MBQ (Management By Quest) MBQ (Management By Quest) Project structure—PM leadership early Project structure—PM leadership early Commitment to decency—premium on thoughtfulness Commitment to decency—premium on thoughtfulness Squint test (diversity, top team “looks like” customer base) Squint test (diversity, top team “looks like” customer base) Go for the “people people” (emphasize intangibles!!) Go for the “people people” (emphasize intangibles!!) “Putting the customer second” “Putting the customer second” Goal: “greatest places to work” recognition Goal: “greatest places to work” recognition Servant leadership Servant leadership

XFX (Cross-functional Excellence)XFX (Cross-functional Excellence) Constant reinforcement with major rewards, punishments (Puckett, Robinson)Constant reinforcement with major rewards, punishments (Puckett, Robinson) Mundane tactics > Edict (% lunches)Mundane tactics > Edict (% lunches) MBWA-demo-”best practices” > EdictMBWA-demo-”best practices” > Edict “The way we do things around here” (focus on operating unit) “The way we do things around here” (focus on operating unit) Manage conflict with decentralization—artistry Manage conflict with decentralization—artistry Reward “what the hell does he do all day” sorts Reward “what the hell does he do all day” sorts Customer-centric Departments (PSF model; prove your worth, serve your Customer-centric Departments (PSF model; prove your worth, serve your customers or else, principal engines of value added)customers or else, principal engines of value added) “ “Partnerships Model” (PSF and internal customers—measure satisfaction; Partnerships Model” (PSF and internal customers—measure satisfaction; union boss and facility boss; vendor-customer teams; sales and client teamsunion boss and facility boss; vendor-customer teams; sales and client teams “Friends in low places” “Friends in low places” Power Nudges (e.g., facilities management)Power Nudges (e.g., facilities management) Transparency!Transparency! Everything on the WebEverything on the Web

Untapped MarketsUntapped Markets Big Two!!!!!! (Strategic-level enterprise-organizing principle) Big Two!!!!!! (Strategic-level enterprise-organizing principle) SheShe is your customer! (So she’d better be your boss!) is your customer! (So she’d better be your boss!) Old Farts Rule! And will rule for the next quarter century! (Welcome to Old Farts Rule! And will rule for the next quarter century! (Welcome to Boomer-Geezer Time!)Boomer-Geezer Time!)

Value-added FanaticismValue-added Fanaticism TGR > TGW (experience) (emphasis on “little touches”—“the case of the 2-centTGR > TGW (experience) (emphasis on “little touches”—“the case of the 2-cent candy”)candy”) Customer Customer SuccessSuccess >>>> Customer >>>> Customer SatisfactioSatisfactionn Schlumberger-IBM-UPS (“We Schlumberger-IBM-UPS (“We areare bold integrated services provision”) (HP-EDS) bold integrated services provision”) (HP-EDS) PSF structurePSF structure Design driven nation (Korea!), “we are design” (Apple)Design driven nation (Korea!), “we are design” (Apple) Ladder (Raw materials-Goods-Services-Solutions-Experience-Dreams comeLadder (Raw materials-Goods-Services-Solutions-Experience-Dreams come true-Lovemark)true-Lovemark)

Base Principles IBase Principles I “Try It” “Try It”

Base Principles IIBase Principles II “Try It” “Try It” DecentralizationDecentralization MBWA MBWA Excellence Excellence Servant leadership Servant leadership

Base Principles IIIBase Principles III “Try It” “Try It” DecentralizationDecentralization O.O.D.A. (tempo, “metabolic management”, speed-of-light prototyping) O.O.D.A. (tempo, “metabolic management”, speed-of-light prototyping) MBWA/“Walk” (25 Rule, 60-call Rule, 3K5M Rule, Texas Bix Bender Rule) MBWA/“Walk” (25 Rule, 60-call Rule, 3K5M Rule, Texas Bix Bender Rule) Excellence (“I’ll know it when I see it”; no non-excellence—Watson Excellence (“I’ll know it when I see it”; no non-excellence—Watson Rule; > OpX) Rule; > OpX) Women as key leadership-senior leadership source, masters of implementationWomen as key leadership-senior leadership source, masters of implementation (Yunus), primary market(Yunus), primary market Decency-respect-transparency Decency-respect-transparency K.I.S.S. (Pronovost Model—check list; Bossidy Model—sum of projects equals K.I.S.S. (Pronovost Model—check list; Bossidy Model—sum of projects equals promise, etc; “Beautiful Systems) promise, etc; “Beautiful Systems) We are all in Sales around here! We are all in Sales around here! Cool is cool (design primacy)Cool is cool (design primacy) We thrive on ambiguity We thrive on ambiguity Execution > Strategy (“Execution Execution > Strategy (“Execution is is strategy”) (Drucker)strategy”) (Drucker) Execution > “Great leaders” (“Execution Execution > “Great leaders” (“Execution isis leadership”) (Drucker) leadership”) (Drucker) Servant leadership—”Cathedral Model”Servant leadership—”Cathedral Model” You could do worse than You could do worse than In Search of ExcellenceIn Search of Excellence (People. Customers. (People. Customers. Action. Entrepreneurial spirit. Values. Focus. K.I.S.S.)Action. Entrepreneurial spirit. Values. Focus. K.I.S.S.)

LeadershipLeadership +21L = -21L+21L = -21L MBWAMBWA ExcellenceExcellence Servant leadersServant leaders

#20#20

EXCELLENCE. EXCELLENCE.

BEDROCK.BEDROCK.LEADERSHIP. LEADERSHIP.

THE 9Ps. THE 9Ps. THE 1M.THE 1M.THE 1E.THE 1E.

THE 9PTHE 9Ps.s.

PURPOSEPURPOSE..PASSIONPASSION..PotentialPotential..PresencePresence..PersonalPersonal..

PERSISTENCEPERSISTENCE..PEOPLEPEOPLE. . PotentPotent..

PositivePositive..

““People want to be part People want to be part of something larger than of something larger than themselvesthemselves.. They want to They want to

be part of something they’re be part of something they’re really really proudproud of, that they’ll of, that they’ll

fight fight forfor,, sacrifice sacrifice forfor , , trusttrust.”.” —Howard Schultz, Starbucks (IBD/09.05)

PURPOSEPURPOSE..

PASSIONPASSION..PotentialPotential..PresencePresence..PersonalPersonal..


PositivePositive..

““I am a … I am a … Dispenser of Dispenser of EnthusiasmEnthusiasm!”!”

—Ben Zander—Ben Zander

PURPOSEPURPOSE..PASSIONPASSION..

PotentialPotential..PresencePresence..PersonalPersonal..


PositivePositive..

““The role of the Director is to The role of the Director is to create a space where the actors create a space where the actors

and actresses canand actresses can become become more than they’ve ever more than they’ve ever been before, more than been before, more than

they’ve dreamed of they’ve dreamed of beingbeing.”.” —Robert Altman, Oscar acceptance speech—Robert Altman, Oscar acceptance speech

PURPOSEPURPOSE..PASSIONPASSION..PotentialPotential..

PresencePresence..PersonalPersonal..


PositivePositive..

MBWAMBWA

PURPOSEPURPOSE..PASSIONPASSION..PotentialPotential..PresencePresence..

PersonalPersonal..PERSISTENCEPERSISTENCE..

PEOPLEPEOPLE. . PotentPotent..

PositivePositive..

““You must You must bebe the change you the change you

wish to see in the wish to see in the world.”world.”

Gandhi



PositivePositive..

RelentlessRelentless:: “One of “One of

my superstitions had always been my superstitions had always been when I started to go anywhere or when I started to go anywhere or

to do anything,to do anything, notnot to to turnturn backback ,, or stop, or stop,

until the thing intended was until the thing intended was accomplished.”accomplished.” —Grant


PERSISTENCEPERSISTENCE..

PEOPLEPEOPLE. . PotentPotent..

PositivePositive..


‘‘dodo’’ people. people.

Period.”Period.” —Anon.


PERSISTENCEPERSISTENCE..PEOPLEPEOPLE. .

PotentPotent..PositivePositive..

Kevin Roberts’ Credo

11. Ready. Fire! Aim.. Ready. Fire! Aim.2. If it ain’t broke ... Break it!2. If it ain’t broke ... Break it!3. Hire crazies.3. Hire crazies.4. Ask dumb questions.4. Ask dumb questions.5. Pursue failure.5. Pursue failure.6. Lead, follow ... or get out of the way!6. Lead, follow ... or get out of the way!7. Spread confusion.7. Spread confusion.8. Ditch your office.8. Ditch your office.9. Read odd stuff.9. Read odd stuff.

10. Avoid moderationAvoid moderation!!

““Do one Do one thing every thing every

day that day that scares you.”scares you.”

—Eleanor Roosevelt

““Ever notice that Ever notice that ‘what the hell’‘what the hell’ is is always the right always the right

decision?”decision?”

Source: unknown Hollywood script writer (courtesy The Borealis Press)Source: unknown Hollywood script writer (courtesy The Borealis Press)



PositivePositive..

On NELSON: “[other] “[other] admirals more admirals more frightened of frightened of losing than losing than

anxious to win”anxious to win”



PositivePositive..

The 1m.The 1m.

The greatest dangerThe greatest dangerfor most of usfor most of us

is not that our aim isis not that our aim istoo hightoo high

and we miss it,and we miss it,but that it isbut that it is

too lowtoo lowand we reach it.and we reach it.

Michelangelo

24%24%

The 1E.The 1E.

““Excellence can be obtained if you:Excellence can be obtained if you:

... care more than others think... care more than others think is wise;is wise; ... risk more than others think ... risk more than others think is safe;is safe; ... dream more than others think ... dream more than others think is practical;is practical; ... expect more than others think ... expect more than others think is possible.”is possible.”

Source: Anon.Source: Anon. (Posted @ tompeters.com by (Posted @ tompeters.com by K.Sriram, November 27, 2006 1:17 AM)K.Sriram, November 27, 2006 1:17 AM)

If Not If Not ExcellenceExcellence

,, What?What?

Tom Peters’ EXCELLENCE. ALWAYS. Bunge/Senior Managers’ Meeting 11 June 2008/Buenos Aires.

Documents

Transcript of Tom Peters’ EXCELLENCE. ALWAYS. Bunge/Senior Managers’ Meeting 11 June 2008/Buenos Aires.