EXCELLENCE. ALWAYS. LONG Tom Peters’ EXCELLENCE. ALWAYS. XAlways/Austin/07 September 2006.
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Transcript of Tom Peters’ EXCELLENCE. ALWAYS. XAlways/Austin/07 September 2006
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Tom Peters’
EXCELLENCEXCELLENCE. ALWAYS.E. ALWAYS.
XAlways/Austin/07 September 2006
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Slides* at …
tompeters.comtompeters.com
*also “LONG”
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That’s a
BigBig Number
….
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THREE THREE BILLIONBILLION NEW NEW CAPITALISTSCAPITALISTS
—Clyde Prestowitz
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“There is no job that
is America’s God-given
right anymore.”
—Carly Fiorina/HP/January2004
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“Deutsche Bank Moves Half of Its Back-office Jobs to India”/
headline/FT/0327 (500 (500 of 900 of 900
Research)Research)
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EXCELLENCE.
MANDATE.
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““If you don’t If you don’t like change, like change,
you’re going to you’re going to like like irrelevanceirrelevance even less.”even less.” —General Eric
Shinseki, Chief of Staff. U. S. Army
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““It is It is notnot the the sstrontronggest est of the of the
species that species that survives, survives, nornor the the most intellimost intelliggentent, , but but the one most the one most
resrespponsive onsive to chanto changgee.”.” —Charles Darwin
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“Forbes100” from 1917 to 1987: 39 members of the Class of ’17 were alive
in ’87; 18 in ’87 F100; 18 F100 “survivors” significantly
underperformed the market;
just 2 (2%), GE & Kodak, outperformed the market from
1917 to 1987.
S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were alive in
’97; 12 (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
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“It is generally much easier to kill an kill an
organizationorganization than change it
substantially.” —Kevin Kelly, Out of Control
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(Practical) ImplicationImplication?
“Go for it!”“Go for it!” (Why not—
alternative is slow death, at best)
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C.E.O. to
C.D.O.
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“The Silicon Valley of today is built less atop
the spires of earlier triumphs than upon the
rubble of earlier debacles.” —Newsweek/Paul Saffo
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TP#1*:
NetscapeNetscape!!
*Where would you rather have worked for those 5 years, Netscape or IBM-HP-Microsoft-Oracle? (Where, 25 years from now, would you
rather to be able to tell someone—e.g., grandchild—that you worked?)
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““Wealth in this new regime Wealth in this new regime flows directly from innovation, flows directly from innovation,
not optimization. That is, not optimization. That is, wealth is not gained by wealth is not gained by
perfecting the known, perfecting the known, but by but by imperfectly seizing the imperfectly seizing the unknown.”unknown.” —Kevin Kelly, New Rules for
the New Economy
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New Economy?!
Sergey + Sergey + Larry Larry > >
Harvard/Harvard/370370
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EXCELLENCE. STARTERS.HORRORS.
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Franchise Lost!
TP: “How many of you [600] really
cravecrave a new Chevy?”
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“Ford, GM and Chrysler do not just make cars expensively … they make bad
cars expensively.” —
Investec analyst, International Herald, 0805.06
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Sluggish + Obese + Unimaginative + More
Sluggish + More Obese + More Unimaginative + Even More Sluggish + Even More
Obese + Even More
Unimaginative = NISSAN + RENAULT + GM = Innovative Challenger for
Toyota????
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Oh, Great …
Ford: Airplane
guy.GM: CFO.
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Small cars HQ: Small cars HQ: LA.LA. Big cars HQ: Big cars HQ: Dallas.Dallas. Corporate HQ: Corporate HQ: Atlanta.Atlanta.
CEO: CEO: Roger Enrico Roger Enrico oror Lou Gerstner Lou Gerstner oror Meg Whitman.Meg Whitman. COO: COO: Bob Nardelli.Bob Nardelli.
Chairman: Chairman: George Steinbrenner George Steinbrenner oror Jack Welch Jack Welch oror Ross Perot. Ross Perot. Vice-chairman Vice-chairman
& CFO: & CFO: Warren Buffett.Warren Buffett.
Chief Marketing Officer: Chief Marketing Officer: Brenda Barnes.Brenda Barnes. Chief Branding Officer: Chief Branding Officer: Phil KnightPhil Knight
(or (or Howard SchultzHoward Schultz). Chief Innovation ). Chief Innovation Officer: Officer: Steve Jobs Steve Jobs oror Jeff Immelt. Jeff Immelt. Chief/Supply Chain: Raid Chief/Supply Chain: Raid Wal*MartWal*Mart or or CostCoCostCo or or Dell.Dell. Chief/Dealer Chief/Dealer
Relations: Relations: Carl Sewell.Carl Sewell.
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EXCELLENCE. STARTERS.
BASICS.
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Did one of ’em ever turn to the other and say: “Wow, “Wow,
I wonder what I wonder what unimaginable new unimaginable new
tools, tools, otherwise not otherwise not ppossibleossible, will be , will be
brought forth brought forth for mfor myy daudaugghter Alice, ahter Alice, agge e
1717, because, because of this deal?” of this deal?”
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People.Product.Clients.
Execution.Enthusiasm.Excellence.
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People.Product.Clients.
Execution.Enthusiasm.Excellence.Relentless.
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People.Product.Clients.
Execution.Enthusiasm.Excellence.Relentless.
Senility.
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Forget>“Learn”
“The problem is never how to get new, innovative
thoughts into your
mind, but how to get the old ones out.” —Dee Hock
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EXCELLENCE. THE WORD.
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Synonyms
PurityTranscendence
VirtueEleganceMajesty
Antonyms
Mediocrity
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EXCELLENCE.
GAMECHANGER.
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Excellence1982: The Bedrock “Eight Basics”
1. A Bias for 1. A Bias for ActionAction2. Close to the 2. Close to the CustomerCustomer3. Autonomy and 3. Autonomy and EntrepreneurshipEntrepreneurship4. Productivity Through 4. Productivity Through PeoPeopplele5. 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-Tight8. Simultaneous Loose-Tight Properties” Properties”
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ExIn*: 1982-2002/Forbes.com
DJIA: $10,000 yields $85,000 EI: $10,000 yields $140,050
*Forbes/Excellence Index /Basket of 32 publicly traded stocks
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EXCELLENCE.
ALWAYS.
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““Why in the Why in the world did world did you go to you go to SSiberiaiberia?”?”
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Business* ** (*at its best): An emotional, An emotional, vital, innovative, joyful, vital, innovative, joyful,
creative, entrepreneurial creative, entrepreneurial endeavor that elicits endeavor that elicits
maximum concerted human maximum concerted human potential in the potential in the
wholehearted servicewholehearted service of others of others.***
**Excellence. Always.***Employees, Customers, Suppliers, Communities, Owners, Temporary partners
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EXCELLENCE.
VALUE ADDED.UP THE LADDER.
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EXCELLENCE.
SOLVE IT.
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$55$55BB
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“Big Brown’s New Bag: UPS
Aims to Be theAims to Be the Traffic Traffic Manager for Manager for CorCorpporate orate
AmericaAmerica”” —Headline/BW
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EXCELLENCE.
SOLVE IT. NO OPTION.PSF. (PSF++)
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“ ‘Disintermediation’ is overrated. Those who fear disintermediation should in fact be afraid of
irrelevance—disintermediation is just another way
of saying that … you’ve become
irrelevant to your
customers.”
—John Battelle/Point/Advertising Age/07.05
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Department Head
to …
Managing
Partner, IS [HR, R&D, etc.] Inc.
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Up, Up, Up,
Up
the Value-added Ladder.
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The Value-added Ladder/Opportunity-seeking
Gamechanging Gamechanging SolutionsSolutions
ServicesGoods
Raw Materials
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EXCELLENCE.
EXPERIENCE IT.
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“Experiences are as distinct
from services as services are from
goods.” —Joe Pine & Jim Gilmore, The Experience Economy:
Work Is Theatre & Every Business a Stage
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Experience: “Rebel Lifestyle!”
“What we sell is the ability for a 43-year-old accountant to dress in
black leather, ride through small towns and
have people be afraid of him.”
Harley exec, quoted in Results-Based Leadership
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The Value-added Ladder/Memorable Connection
Spellbinding Spellbinding ExperiencesExperiences
Gamechanging SolutionsServicesGoods
Raw Materials
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$79$7988
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$415/SqFt/Wal*Mart$798/SqFt/Whole
Foods
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Summary:
WallopWal*Mart16*
*Or: Why it’s so absurdly easy to beat a GIANT Company
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The Small*Mart Revolution: How Local Businesses Are Beating Local
Competition —Michael Shuman
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EXCELLENCE.
DREAM IT.
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Furniture vs. Dreams
“We do not sell ‘furniture’ at
Domain. We sell dreams. 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
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The Value-added Ladder/Emotion
Dreams Come Dreams Come TrueTrue
Spellbinding Experiences Gamechanging Solutions
ServicesGoods
Raw Materials
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Big Blue
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EXCELLENCE.
LOVE IT.
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Kevin Roberts:
LovemarLovemar
ksks!!
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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
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LovemarkLovemark Dreams Come True
Spellbinding ExperiencesGamechanging Solutions
ServicesGoods
Raw Materials
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EXCELLENCE.NEW VALUE EQUATION. NEW “C-levels”.
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CCXXOO**Chief eXperience Officer
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CCDMDM*
*Chief Dream Merchant
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CCLL OO*
*Chief Lovemark Officer
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CCSTSTOO*
*Chief Storytelling Officer
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CCDDOO**Chief Design Officer
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CCfafaOO*
*Chief freaks acquisition Officer
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CCQQOO*
*Chief quest-meister
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CCWWOO**Chief WOW Officer
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CRO*
*Chief Revenue Officer
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EXCELLENCE. EVERYWHERE.
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SpainPortugal
ItalyIreland
Singapore TaiwanThailandMalaysia
Singapore Philippines
UAEOmanChile
RomaniaNew Zealand
Australia
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Better By Design: A National Strategy
NZ = NZ = Design Design
ExcellencExcellencee
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EXCELLENCE.CENTURY 21.
EMPIRES OF THE MIND.RICHARD FLORIDA.
JUAN ENRIQUEZ.
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““HumanHuman creativity is the creativity is the
ultimate ultimate economic economic
resource.”resource.” —Richard Florida, The Rise of the Creative Class
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““THE FUTURE BELONGS THE FUTURE BELONGS TO … SMALL TO … SMALL
POPULATIONS … WHO POPULATIONS … WHO BUILD BUILD EMPIRESEMPIRES OF THEOF THE
MINDMIND … AND WHO IGNORE THE TEMPTATION OF—OR DO NOT HAVE THE
OPTION OF—EXPLOITING NATURAL RESOURCES.”
Source: Juan Enriquez/As the Future Catches You
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U.S. Historical Strength: Invest in Creativity
*Foster new industries*Foster new industries
*Free & open society*Free & open society
*Investment higher ed,*Investment higher ed, R & D, culture R & D, culture
*Immigrants*Immigrants
Source: Richard Florida, The Rise of the Creative Class
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CI/Top10 Metro*: AustinAustin, SF, , SF, Seattle, Boston, Raleigh-Seattle, Boston, Raleigh-
Durham, Portland, Durham, Portland, Minneapolis, Washington-Minneapolis, Washington-Baltimore, Sacramento, Baltimore, Sacramento,
DenverDenver
CI/Bottom10: Detroit, Norfolk, Cleveland, Milwaukee, Grand Rapids, Memphis, Jacksonville, Greensboro, New Orleans, Buffalo, Louisville
*> 1M/49 totalSource: Richard Florida, The Rise of the Creative Class
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“The global talent pool and the high-end, high margin creative industries that used to be the sole province of the U.S., and a critical source of its
prosperity, have begun to disperse around the globe. A host of countries—Ireland, Finland, Canada, Australia, New Zealand, among them—are investing
in higher education, cultivating creative people, and churning out stellar products, from Nokia phones to the Lord of the Rings movies.. Many of these countries have learned from past U.S. success and are shoring up efforts to
attract foreign talent—including Americans. … The United States may well be the Goliath of the twentieth century global economy, but it will take just half a
dozen twenty-first-century Davids to begin to wear it down. To stay To stay innovative, America must continue to attract the innovative, America must continue to attract the world’s sharpest minds. And to do that, it needs world’s sharpest minds. And to do that, it needs
to invest in the further development of its to invest in the further development of its creative sector. Because wherever creativity creative sector. Because wherever creativity
goes—and, by extension, wherever talent goes—goes—and, by extension, wherever talent goes—innovation and economic growth are sure to innovation and economic growth are sure to followfollow.”.” —“America’s Looming Creativity Crisis”/Richard
Florida/HBR/10.04
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EXCELLENCE.
INNOVATE. OR. DIE.
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“A focus on cost-cutting and efficiency has helped many organizations weather the
downturn, but this approach will ultimately
render them obsolete. OnlOnlyy the the constantconstant p pursuit of ursuit of
innovation can innovation can ensure lonensure long-g-term term
successsuccess.”.” —Daniel Muzyka, Dean, Sauder School of Business,
Univ of British Columbia (FT/09.17.04)
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More than $$$$
#1#1 R&D
spending, last 25 years?
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GM
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“I don’t believe in
economies of scale. You don’t get better by being bigger. You get worse.” —
Dick Kovacevich/Wells Fargo/Forbes/08.04 (ROA: Wells, 1.7%; Citi, 1.5%; BofA, 1.3%;
J.P. Morgan Chase, 0.9%)
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Scale?
“Microsoft’s Struggle With
Scale” —Headline, FT, 09.2005
“Troubling ExitsExits at Microsoft” —Cover Story, BW, 09.2005
“Too BigToo Big to Move Fast?” —Headline, BW, 09.2005
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“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
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The Perils of Conservatism/The Perils of Conservatism/IndustrIndustryy Leadershi Leadershipp
“ ‘“ ‘GoodGood management’ was management’ was the most powerful reason the most powerful reason
[leading firms] failed to stay [leading firms] failed to stay atop their industries.atop their industries. Precisely Precisely
because these firms listened to their because these firms listened to their customers, invested aggressively in customers, invested aggressively in
technologies that would provide their technologies that would provide their customers more and better products of the customers more and better products of the
sort they wanted, and because they sort they wanted, and because they carefully studied market trends and carefully studied market trends and
systematically allocated investment capital systematically allocated investment capital to innovations that promised the best to innovations that promised the best
returns, they lost their positions of returns, they lost their positions of leadership.”leadership.”
—Clayton Christensen, The Innovator’s Dilemma
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InnoTacs
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We We becomebecome who we hang who we hang
out with!out with!
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“The Bottleneck
Is at the Top of the
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:
At the top!”
— Gary Hamel/Harvard Business Review
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Measure “Strangeness”/Portfolio Quality
StaffConsultantsConsultants
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
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try ittry it
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““Experiment Experiment fearlessly”fearlessly”
Source: BW0821.06, Type A Organization Strategies/ “How to Hit a Moving Target”—Tactic #1
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tolerate tolerate [encourage?] [encourage?]
failurefailure
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Sam’s Sam’s Secret Secret
#1!#1!
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bet the bet the farmfarm
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“[Immelt] is now identifying technologies with which GE
will … ssyystematicallstematicallyy set out to build set out to build
entirelentirelyy new new industriesindustries”” —Strategy+Business, Fall
2005
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EXCELLENCE.
4/40.
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4/404/40
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De-cent-De-cent-ral-iz-ral-iz-a-tion!a-tion!
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Ex-e-Ex-e-cu-cu-
tion!tion!
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Ac-count-Ac-count-a-bil-ity!a-bil-ity!
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6:15A.M6:15A.M..
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EXCELLENCE.
ACTION.ROOTS.
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GRANT
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“One of my superstitions had always been when I
started to go anywhere or
to do anything, not to not to turn backturn back, or stop, until
the thing intended was accomplished.” —Grant
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NELSON
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On NELSON: “[other] “[other] admirals more admirals more frightened of frightened of losing than losing than
anxious to win”anxious to win”
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BOYD
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He who has the He who has the quickest quickest
“O.O.D.A. “O.O.D.A. Loops”* wins!Loops”* wins!
*Observe. Orient. Decide. Act. /Col. John Boyd
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BOSSIDY
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““ExecutionExecution is is thethe j jobob of the of the
business business leaderleader.”.” —Larry Bossidy—Larry Bossidy & Ram
Charan/ Execution: The Discipline of Getting Things Done
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“Execution is a
ssyystematic stematic pprocessrocess of rigorously
discussing hows and whats, tenaciously following through, and
ensuring accountability.” —Larry Bossidy & Ram Charan/ Execution:
The Discipline of Getting Things Done
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PEROT
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READY.READY.FIRE!FIRE!AIM.AIM.
Ross Perot (vs “Aim! Aim! Aim!” /EDS vs GM/1985)
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MASTERS
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“This is so simple it sounds stupid, but it is amazing how few oil people really
understand that you only find oil if you drill 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
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HERB
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““We have a We have a ‘strategic plan.’ ‘strategic plan.’ It’s called It’s called doing doing thingsthings.”.” — Herb Kelleher
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EXCELLENCE.
BEDROCK.TALENT.
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Brand Brand = =
Talent.Talent.
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DDDD$21M$21M
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A review of Jack and Suzy Welch’s Winning claims there are but two key differentiators that set GE “culture” apart from the herd:
First: Separating financial forecasting and performance measurement. Performance measurement based, as it usually is, on budgeting leads to an epidemic of gaming the system. GE’s performance measurement is divorced from budgeting—and instead reflects how you do relative to your past performance and relative to competitors’ performance; i.e., it’s about how you actually do in the context of what happened in the real world, not as compared to a gamed-abstract plan developed last year.
Second: Putting Putting HRHR on on a par with finance a par with finance and marketing.and marketing.
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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
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“The role of the Director is to create a
space where the actor or actress can become more than become more than thetheyy’ve ever been ’ve ever been beforebefore, , more than more than
thetheyy’ve dreamed of ’ve dreamed of beinbeing.”g.” —Robert Altman, Oscar
acceptance
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CCQQOO*
*Chief quest-meister
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EXCELLENCE. INDIVIDUAL.BRAND YOU.
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““If there is nothing If there is nothing very special about very special about
your work,your work, no matter how no matter how hard you apply yourself you hard you apply yourself you won’t get noticed, and that won’t get noticed, and that
increasingly means you won’t increasingly means you won’t
get paid much either.”get paid much either.” —Michael Goldhaber, Wired
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DistinctDistinct … or
… ExtinctExtinct
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EXCELLENCE
AWOL: THE NEW ECONOMY AND THE SCHOOLS
FIASCO
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“My wife and I went to a [kindergarten] parent-teacher conference and were informed that our budding
refrigerator artist, Christopher, would be receiving a grade of Unsatisfactory in art. We were shocked. How
could any child—let alone our child—receive a poor grade
in art at such a young age? His teacher His teacher informed us that he had informed us that he had
refused to color within the refused to color within the lines, which was a state lines, which was a state
rereqquirement for uirement for demonstratindemonstratingg ‘ ‘ggrade-rade-level motor skillslevel motor skills.’ ”
—Jordan Ayan, AHA!
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Ye gads: “Thomas Stanley has Thomas Stanley has not only found no correlation not only found no correlation
between success in school between success in school and an ability to accumulate and an ability to accumulate wealth, he’s actually found a wealth, he’s actually found a negative correlation.negative correlation. ‘It seems that
school-related evaluations are poor predictors of economic success,’ Stanley concluded. What did predict success was a willingness to take risks. Yet the success-failure standards of most schools penalized risk takers.
Most educational systems reward those who play it safe. As a result, those who do well in school find it hard to
take risks later on.” —Richard Farson & Ralph Keyes, Whoever Makes the Most
Mistakes Wins
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15 “Leading” Biz Schools
Design/Core: 0Design/Elective: 1
Creativity/Core: 0Creativity/Elective: 4
Innovation/Core: 0Innovation/Elective: 6
Source: DMI/Summer 2002/Research by Thomas Lockwood
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EXCELLENCE.
BEDROCK.PURPOSE.
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“I never, ever thought of myself as a
businessman. I was interested in creating
things I would be proud of.”
—Richard Branson
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“People want to be part of something larger
than themselves. They want to be part of
something they’re really proud of, that they’ll
fight for, sacrifice for , trust.” —Howard Schultz, Starbucks
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EXCELLENCE.ENTHUSIASM.
ENERGY. PASSION.
RELENTLESSNESS.
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““Nothing is so Nothing is so contagious as contagious as enthusiasm.”enthusiasm.”
—Samuel Taylor Coleridge
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“It is no use saying ‘We are doing our best.’ You have got to succeed in doing
what is necessary.” —WSC
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EXCELLENCE.
AGILITY.
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““The most The most successful successful
people are those people are those who who
are good at plan are good at plan B.”B.”
—James Yorke, mathematician, on chaos theory in The New Scientist
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EXCELLENCE. SHOWING UP.
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2255
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MBWAMBWA
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“You must bebe the change you
wish to see in the world.”
Gandhi
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“The The FirstFirst stepstep in a in a ‘dramatic’ ‘dramatic’
‘organizational change ‘organizational change program’ is obvious—program’ is obvious—
dramaticdramatic personal personal changechange!”!” —RG
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EXCELLENCE.
STRETCH.
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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
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Kevin Roberts’ Credo
1. Ready. Fire! Aim.2. If it ain’t broke ... Break it!3. Hire crazies.4. Ask dumb questions.5. Pursue failure.6. Lead, follow ... or get out of the way!7. Spread confusion.8. Ditch your office.9. Read odd stuff.
10. Avoid Avoid moderationmoderation!!
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EXEXCELLE CELLE ALWALWAYSAYS..