Excellence

Excellence. Always.
If not Excellence, what?
If not Excellence now, when?

Novosibirsk 2006/Enterprise* (*at its best): An emotional, vital, innovative, joyful, creative, entrepreneurial endeavor that elicits maximum
concerted human
potential in the
wholehearted pursuit of EXCELLENCE in
service of others.**
**Employees, Customers, Suppliers, Communities, Owners, Temporary partners
Novosibirsk 2006/Enterprise* (*at its best): An emotional, vital, innovative, joyful, creative, entrepreneurial endeavor that elicits maximum
concerted human
potential in the
wholehearted pursuit of EXCELLENCE in
service of others.**
**Employees, Customers, Suppliers, Communities, Owners, Temporary partners

Sydney 2007/1st Drucker Commemorative Conference
Organizations exist to serve. Period.
Leaders live to
serve. Period.

1/4096 @ excellencenow.com
“Business has to give people enriching, rewarding lives … or it's simply not worth doing.”
—Richard Branson

7 Steps to Sustaining Success
You take care of the people.
The people take care of the service.
The service takes care of the customer.
The customer takes care of the profit.
The profit takes care of the re-investment.
The re-investment takes care of the re-invention.
The re-invention takes care of the future.
(And at every step the only measure is EXCELLENCE.)

Part ONE

#1

Little =
BIG

#2

7X.
7:30A-8:00P. F12A.
7:30AM = 7:15AM.
8:00PM = 8:15PM.

#3

It BEGINS (and ENDS) in the …

Parking lot*
*Disney

#4

Don’t like it?
Don’t pay.
Source: Granite Rock Co.

Red light flashes=
-10%

#5

National “Brand”/ 2-cent candy

#6

Conveyance: Kingfisher Air Location: Approach to New Delhi

“May I clean your glasses, sir?”

#7

Compression Hose = 10,000

#8

30 minutes = 1%
$25M/$20M/$200K

#9

2X
Source: Container Store/increase average sale per shopper

#10

Bag sizes = New markets:
$B
Source: PepsiCo

Big carts =
1.5X
Source: Wal*Mart

#11

TGR
[Things Gone WRONG-Things Gone RIGHT]

Customers describing their service experience as “superior”: 8%
Companies describing
the service experience they provide as
“superior”: 80%
—Source: Bain & Company survey of 362 companies, reported in John DiJulius,
What's the Secret to Providing a World-class Customer Experience?

“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

“Perception is all
there is”

Comeback
[big, quick response]
>>
Perfection

Acquire vs maintain*:
5X
*Recession goal: Higher “market share” current customers

CXO*
*Chief eXperience Officer

#12

Conrad Hilton, at a gala celebrating his career, was called to the podium and asked, “What were the most important lessons you learned in your long and distinguished career?” His answer …

“Remember
to tuck the shower curtain inside the bathtub.”

You get ’em in the
door with “location, location, location”—and a terrific architect. You keep ’em coming back with the tucked in shower curtain!*
*Profit rarely comes from transaction #1;
it is a byproduct of transaction #2, #3, #4 …

“Execution is strategy.” —Fred Malek

Sports: You beat yourself!

“Execution is the job of the business leader.”—Larry Bossidy & Ram Charan/ Execution: The Discipline of Getting Things Done

#13

(1) Amenable to rapid
experimentation/
failure “free” (PR, $$)
(2) Quick to implement/ Quick to Roll out
(3) Inexpensive to
implement/Roll out
(4) Huge multiplier
(5) An “Attitude”

Half-day/25 ideas
One week/5 experiments
(3) One month/Select best 2
(4) 60-90 days/Roll out

Little =
BIG

Part TWO

FIVE “First things Before First Things …”

#1

If the regimental commander lost most of his 2nd lieutenants and 1st lieutenants and captains and majors, it would be a tragedy. If he lost his sergeants it would be a catastrophe. The Army and the Navy are fully aware that success on the battlefield is dependent to an extraordinary degree on its Sergeants and Chief Petty Officers. Does industry have the same awareness?

#1 cause of
employee
Dis-satisfaction?

“People leave managers not companies.”
—Dave Wheeler

Suggested addition to your statement of Core Values: “We are obsessed with developing a cadre of 1st line managers that is second to none—we understand that this cadre per se is arguably one of our top two or three most important ‘Strategic Assets.’”

#2

XFX = #1*
*Cross-Functional eXcellence

Never waste a lunch!

“Personal relationships are the fertile soil from which all advancement, all success, all achievement in real
life grow.” —Ben Stein

% XF lunches*
*Measure! Monthly! Part of evaluation! [The PAs Club.]

XFX: Social accelerators …*
*See “LONG” version of presentation
at tompeters.com for more

XFX/Typical Social Accelerators
1. EVERYONE’s [more or less] JOB #1: Make friends in other functions! (Purposefully. Consistently. Measurably.)
2. “Do lunch” with people in other functions!! Frequently!! (Minimum 10% to 25% for everyone? Measured.)
3. Ask peers in other functions for references so you can become conversant in their world. (It’s one helluva sign of ... GIVE-A-DAMN-ism.)
4. Religiously invite counterparts in other functions to your team meetings. Ask them to present “cool stuff” from “their world” to your group. (Useful. Mark of respect.)
5. PROACTIVELY SEEK EXAMPLES OF “TINY” ACTS OF “XFX” TO ACKNOWLEDGE—PRIVATELY AND PUBLICALLY. (Bosses: ONCE A DAY … make a short call or visit or send an email of “Thanks” for some sort of XFX gesture by your folks and some other function’s folks.)
6. Present counterparts in other functions awards for service to your group. Tiny awards at least weekly; and an “Annual All-Star Supporters [from other groups] Banquet” modeled after superstar salesperson banquets.

XFX/: Typical Social Accelerators
16. Formal evaluations. Everyone, starting with the receptionist, should have a significant XF rating component in their evaluation. (The “XFX Performance” should be among the Top 3 items in all managers’ evaluations.)
17. Every functional unit should have strict and extensive measures of “customer satisfaction” based on evaluations from other functions of its usefulness and effectiveness and value-added to the enterprise as a whole.
18. Demand XF experience for, especially, senior jobs. For example, the U.S. military requires all would-be generals and admirals to have served a full tour in a job whose only goals were cross-functional achievements.
19. “Deep dip.” Dive three levels down in the organization to fill a senior role with some one who has been noticeably pro-active on adding value via excellent cross-functional integration.
20. XFX is … PERSONAL … as well as about organizational effectiveness. PXFX [Personal XFX] is arguably the #1 Accelerant to personal success—in terms of organizational career, freelancer/Brand You, or as entrepreneur.
21. Excellence! There is a “State of XF Excellence” per se. Talk it up constantly. Pursue it. Aspire to nothing less.

“I am hundreds of times better here [than
in my prior hospital assignment] because of the support system. It’s like you were working in an organism; you are not a single cell when you are out there practicing.’” —quote from Dr. Nina Schwenk, in Chapter 3, “Practicing Team Medicine,” from Leonard Berry & Kent Seltman,
from Management Lessons From Mayo Clinic

WOW!!
Observed closely: The use of “I” or “we” during a
job interview.
Source: Leonard Berry & Kent Seltman, chapter 6, “Hiring for Values,”
Management Lessons From Mayo Clinic

#3

In the Army, 3-star generals worry about training. In most businesses, it's a “ho hum” mid-level staff function.

I would hazard a guess that most CEOs see IT investments as a “strategic necessity,” but see training expenses as “a necessary evil.”

(1) Training merits
“C-level” status!
(2) Top trainers should
be paid a king’s
ransom—and be of
the same caliber as
top marketers or
researchers.

No company ever expended too much thought/effort/ $$$$ on training!*
*ESPECIALLY … small company

Q3 2011/BLS
+3.1/Non-farm productivity growth
+3.8/Non-farm output
+0.6/Non-farm hours worked
+5.4/Manufacturing productivity
+4.7/Manufacturing output
-0.6/Manufacturing hours worked
Source: Bureau of Labor Statistics/03 November 2011

“The root of our problem is
not that we’re in a Great Recession or a Great Stagnation, but rather that we are in
the early throes of a Great Restructuring. Our technologies are racing ahead, but many of our skills and organizations are lagging behind.”
Source: Race AGAINST the Machine, Erik Brynjolfsson and Andrew McAfee

Legal industry/Pattern Recognition/Discovery (e-discovery algorithms):
500 lawyers to …
ONE
Source: Race AGAINST the Machine, Erik Brynjolfsson and Andrew McAfee

“A bureaucrat is an expensive microchip.”
—Dan Sullivan, consultant and executive coach

China too/Foxconn:
1,000,000 robots in next 3 years
Source: Race AGAINST the Machine, Erik Brynjolfsson and Andrew McAfee

A 15-Point
Human Capital Asset Development Manifesto
World Strategy Forum
The New Rules: Reframing Capitalism
Seoul, Korea
Tom Peters/0615.12

A 15-Point Human Capital Development Manifesto
1. “Corporate social responsibility” starts at home—i.e., inside the enterprise! MAXIMIZING GDD/Gross Domestic Development of the workforce is the primary source of mid-term and beyond growth and profitability—and maximizes national productivity and wealth. (Re profitability: If you want to serve the customer with uniform Excellence, then you must FIRST effectively and faithfully serve those who serve the customer—i.e. our employees, via maximizing tools and professional development.)

3. Three-star generals and admirals (and symphony conductors and sports coaches and police chiefs and fire chiefs) OBSESS about training. Why is it an almost dead certainty that in a random 30-minute interview you are unlikely to hear a CEO touch upon this topic? (I would hazard a guess that most CEOs see IT investments as a “strategic necessity,” but see training expenses as “a necessary evil.”)
4. Proposition/axiom: The CTO/Chief TRAINING Officer is arguably the #1 staff job in the enterprise, at least on a par with, say, the CFO or CIO or head of R&D. (Again, external circumstances—see immediately above—are forcing our hand.)

5. The training budget takes precedence over the capital budget. PERIOD. It’s easier fun to get you picture taken next to a hew machine. But how do you get a photo of a new and much improved attitude in a key distribution center? But the odds are 25:1 that the new attitude will add more to the bottom line than will the glorious state-of-the-art machine.
6. Human capital development should routinely sit atop any agenda or document associated with enterprise strategy. Most any initiative you undertake should formally address implications for and contributions to human capital asset development.

7. Every individual on the payroll should have a benchmarked professional growth strategy. Every leader at every level should be evaluated in no small measure on the collective effectiveness of individual growth strategies—that is, each individual’s absolute growth is of direct relevance to every leader’s assessed performance.

“Knowledge becomes obsolete incredibly fast. The continuing professional education
of adults is the No. 1 industry in the next 30 years.” —Peter Drucker

11. The national education infrastructure—from kindergarten to continuing adult education—may well be National Priority #1. Moreover, the educational infrastructure must be altered radically to underpin support for the creative jobs that will be more or less the sole basis of future employment and national growth and wealth creation.

“Human creativity is the ultimate economic resource.” —Richard Florida
“Every child is born an artist. The trick is to remain an artist.” —Picasso

SMEs To The Rescue!
“We are in no danger of running out of new combinations to
try. Even if technology froze today, we have more possible ways of configuring the
different applications, machines, tasks, and distribution
channels to create new processes and products than
we could ever exhaust.”
Source: Race AGAINST the Machine, Erik Brynjolfsson and Andrew McAfee

13. The great majority of us work in small enterprises; hence national growth objectives based upon human capital development MUST necessarily extend “downward” to even 1-person enterprises. Collective productivity improvement through human capital development among small businesses has an unimaginably large—and underappreciated—payoff. While many small business appreciate the notion, they are unprepared to take the steps necessary to engage their, say, dozen employees in seeking productivity improvements.

#4

“The doctor
interrupts
after …*
*Source: Jerome Groopman, How Doctors Think

18 …

18 … SECONDS!

[An obsession with] Listening is ... the ultimate mark
of Respect.
Listening is ... the heart and soul of Engagement.
Listening is ... the heart and soul of Kindness.
Listening is ... the heart and soul of Thoughtfulness.
Listening is ... the basis for true Collaboration.
Listening is ... the basis for true Partnership.
Listening is ... a Team Sport.
Listening is ... a Developable Individual Skill.* (*Though women
are far better at it than men.)
Listening is ... the basis for Community.
Listening is ... the bedrock of Joint Ventures that work.
Listening is ... the bedrock of Joint Ventures that grow.
Listening is ... the core of effective Cross-functional
Communication* (*Which is in turn Attribute #1 of
organizational effectiveness.)
[cont.]

Listen = “Profession” = Study = Practice = Evaluation = Enterprise Value

Is there a full-bore training course in "Listening" for 100% of employees, CEO to receptionists? If not, there ought to be!

#5

Complain all you want, but meetings
are what you [boss] do!

Meetings = #1 leadership opportunity

Meeting: Every meeting that does not stir the imagination and curiosity of attendees and increase bonding and co-operation and engagement and sense of worth and motivate rapid action and enhance enthusiasm is a permanently lost opportunity.

Part THREE

Innovation’s BIG THREE

#1

1/46

Lesson46: WTTMTW

Whoever
Tries
The
Most
Things
Wins

“We made mistakes, of course. Most of them were omissions we didn’t think of when we initially wrote the software. We fixed them by doing it over and over, again and again. We do the same today. While our competitors are still sucking their thumbs trying to make the design perfect, we’re already on prototype version #5. By the time our rivals are ready with wires and screws, we are on version #10. It gets back to planning versus acting: We act from day one; others plan how to plan—for months.”
—Bloomberg by Bloomberg

“What are Rutan’s management rules? He insists he doesn’t have any. ‘I don’t like rules,’ he says. ‘Things are so easy to change if you don’t write them down.’ Rutan feels good management works in much the same way good aircraft design does: Instead of trying to figure out the best way to do something and sticking to it, just try out an approach and keep fixing it.”
—Eric Abrahamson & David Freedman, Chapter 8, “Messy Leadership,” from A Perfect Mess: The Hidden Benefits of Disorder

“Experiment fearlessly”
Source: BusinessWeek, “Type A Organization Strategies: How to Hit a Moving Target”—Tactic #1
“Relentless trial
and error”
Source: Wall Street Journal, cornerstone of effective approach to “rebalancing” company
portfolios in the face of changing and uncertain global economic conditions (11.08.10)

In Search of Excellence /1982:
The Bedrock “Eight Basics”
1. A Bias for Action
2. Close to the Customer
3. Autonomy and Entrepreneurship
4. Productivity Through People
5. Hands On, Value-Driven
6. Stick to the Knitting
7. Simple Form, Lean Staff
8. Simultaneous Loose-Tight
Properties

“Fail.
Forward.
Fast.”
High Tech CEO, Pennsylvania

“Reward excellent failures. Punish mediocre successes.”
—Phil Daniels, Sydney exec

“The secret of fast progress is inefficiency, fast and furious and numerous failures.”
—Kevin Kelly

“It is not enough to ‘tolerate’ failure—you must ‘celebrate’ failure.” —Richard Farson (Whoever Makes the Most Mistakes Wins)

Better yet: WTTMTAMTMMTFW

Whoever
Tries
The
Most
Things
And
Makes
The
Most
Mistakes
The
Fastest
Wins

1/4096

“You miss 100% of the shots you never take.”
—Wayne Gretzky

1/46
A bias for action.
(No. 1 “Attribute of Excellence” from In Search of Excellence.)
Ready. Fire. Aim.
(H. Ross Perot/EDS. Vs GM: Ready. Aim. Aim. Aim. Aim. Aim. …)
Just do it!
(Nike.)
Move fast, break things.
(Facebook.)
Experiment fearlessly.
Relentless trial and error.
You miss 100% of the shots you never take.
(Wayne Gretzky.)
Fail. Forward. Fast.
Fail faster, succeed sooner.
(IDEO.)
Reward excellent failures. Punish mediocre successes.
S.A.V.
(Screw Around Vigorously)
Demo or die.
You only find oil if you drill wells.
WD40
(Water Displacement, 40 Tries.)
Ever notice that “What the hell” is always the right decision?
WTTMSW
(Whoever Tries The Most Stuff Wins.)
WTTMSASTMSUTFW
(Whoever Tries The Most Stuff And Screws The Most Stuff Up The Fastest Wins.)

#2

We Are What We Eat/We Are the Company
We Keep

The “We are what we eat”/
“We are who we associate with” Axiom: At its core, every (!!!) relationship-partnership decision (employee, vendor, customer, etc, etc) is a strategic decision about:
“Innovate,
‘Yes’ or ‘No’ ”

Measure “Strangeness”/Portfolio Quality
Staff
Consultants
Vendors
Out-sourcing Partners (#, Quality)
Innovation Alliance Partners
Customers
Competitors (who we “benchmark” against) Strategic Initiatives
Product Portfolio (LineEx v. Leap)
IS/IT Projects
HQ Location
Lunch Mates
Language
Board

“[CEO A.G.] Lafley has shifted P&G’s focus on
inventing all its own products to developing … others’ inventions at least half the time. One successful
example, Mr. Clean Magic Eraser, based on a product
found in an Osaka market.” —Fortune

“Don’t benchmark, futuremark!”
Impetus: “The future is already here; it’s just
not evenly distributed” —William Gibson

“Don’t benchmark, ‘Other’ mark!”

We are the company
we keep!
Manage it!

“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

Diversity … per se … is a key … maybe the key … to effective and innovative
decision making.

“Who’s the most interesting person you’ve met in the last 90 days? How do I get in touch with them?” —Fred Smith

Co-creation …

“The Billion-man Research Team: Companies offering work to online communities are reaping the benefits of ‘crowdsourcing.’”
—Headline, FT

Forgetting >> Learning

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

#3

Wow!

“Insanely Great”
Steve Jobs
“Radically thrilling”
BMW

Zappos 10 Corporate Values
Deliver “WOW!” through service.
Embrace and drive change.
Create fun and a little weirdness.
Be adventurous, creative and open-minded.
Pursue growth and learning.
Build open and honest relationships with
communication.
Build a positive team and family spirit.
Do more with less.
Be passionate and determined.
Be humble.
Source: Delivering Happiness, Tony Hsieh, CEO, Zappos.com

14,000
20,000
30

14,000/eBay
20,000/Amazon
30/Craigslist

Every project: Where’s your “Craig’s List [WOW!] option”?

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 moderation!

“We are crazy. We should do something when people say it is ‘crazy.’ If people say something is ‘good’, it means someone else is already doing it.”
—Hajime Mitarai, Canon

Part FOUR

FOUR
Key Market Strategies

#1

Design WINs!
APPLE market cap > ExxonMobil*
*August 2011

“Design is treated like a religion at BMW.” —Fortune

“We don’t have a good language to talk about this kind of thing. In most people’s vocabularies, design means veneer. … But to me, nothing could be further from the meaning of design. Design is the fundamental soul of a man-made creation.” —Steve Jobs

“Design is everything.
Everything is design.”
“We are all designers.”
Inspiration: The Power of Design: A Force for Transforming Everything, Richard Farson

“Only one company can be the cheapest. All others must use design.” —Rodney Fitch, Fitch & Co.
Source: Insights, definitions of design, the Design Council [UK]

Suit/Asda/$50
Suit/M&S/10X
Suit/Savile Road bespoke/10X
iPhone/$700
iPhone/“assembled in China”/$20
Source: John Kay/”Our Fetish for Making Things Fails to Understand ‘Real Work’”/FT/11.12

CDO*
*Chief Design Officer

Hypothesis: Men cannot design for women’s needs!!??

#2

“I speak to you with a feminine voice. It’s the voice of democracy, of equality. I am certain, ladies and gentlemen, that this will be the woman’s century. In the Portuguese language, words
such as life, soul, and hope are
of the feminine gender, as are other words like courage and sincerity.” —President Dilma Rousseff of Brazil,
1st woman to keynote the United Nations General Assembly

“Forget China, India and the Internet: Economic Growth Is Driven by Women.”
Source: Headline, Economist

“Women are
THE majority market”
—Fara Warner/The Power of the Purse

W > 2X (C + I)*
*“Women now drive the global economy. Globally, they control about $20 trillion in consumer spending, and that figure could climb as high as $28 trillion in the next five years. Their $13 trillion in total yearly earnings could reach $18 trillion in the same period. In aggregate, women represent a growth market bigger than China and India combined—more than twice as big in fact. Given those numbers, it would be foolish to ignore or underestimate the female consumer. And yet many companies do just that—even ones that are confidant that they have a winning strategy when it comes to women. Consider Dell’s …”
Source: Michael Silverstein and Kate Sayre, “The Female Economy,” HBR, 09.09

2.6 vs. 21

“AS LEADERS, WOMEN RULE: New Studies find that female managers outshine their male counterparts in almost every measure”
TITLE/ Special Report/ BusinessWeek

#3

“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 …
Source: Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics

“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 very large
one and just wait.” —Paul Ormerod, Why Most Things Fail:
Evolution, Extinction and Economics

“Mr. Foster and his McKinsey colleagues collected detailed performance data stretching back 40 years for 1,000 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 Times

“Data drawn from the real world attest to a fact that is beyond our control: Everything in existence tends to deteriorate.”
—Norberto Odebrecht, Education Through Work

Mittelstand* **
* “agile creatures darting between
the legs of the multinational monsters" (Bloomberg BusinessWeek, 10.10)
**E.g. Goldmann Produktion

Retail Superstars: Inside the 25 Best Independent Stores in America —by George Whalin

Jungle Jim’s International Market, Fairfield, Ohio: “An adventure in ‘shoppertainment,’ as Jungle Jim’s call it, begins in the parking lot and goes on to 1,600 cheeses and, yes, 1,400 varieties of hot sauce —not to mention 12,000 wines priced from $8 to $8,000 a bottle; all this is brought to you by 4,000 vendors. Customers come from every corner of the globe.”
Source: George Whalin, Retail Superstars

“Be the best. It’s the only market that’s not crowded.”
From: Retail Superstars: Inside the 25 Best
Independent Stores in America, George Whalin

“We are in no danger of running out of new combinations to try. Even if technology froze today, we have more possible ways of configuring the
different applications, machines, tasks, and distribution
channels to create new processes and products than
we could ever exhaust.”
Source: Race AGAINST the Machine, Erik Brynjolfsson and Andrew McAfee

#4

Huge: Customer “Satisfaction with product/Service”
versus Customer “Success”

IBM
to
IBM

Planetary Rainmaker-in-Chief!
“[CEO Sam] Palmisano’s strategy is to expand tech’s borders by pushing users—and entire industries—toward radically different business models. The payoff for IBM would be access to an ocean of revenue—Palmisano estimates it at $500 billion a year —that technology companies have never been able to touch.” —Fortune

UPS

“THE GIANT STALKING BIG OIL: How Schlumberger Is Rewriting the Rules of the Energy Game.”: “IPM [Integrated Project Management] strays from [Schlumberger’s] traditional role as a service provider and moves deeper into areas once dominated by the majors.”
Source: BusinessWeek cover story, January 2008

IPM’s Chief: “We’ll do just about anything an oilfield owner would want, from drilling to production.”

MasterCard Advisors

IDEO
Product Design
Product Design Training
Innovation Training

“ ‘Results’ are measured by the success of all those who have purchased your product or service” —Jan Gunnarsson &
Olle Blohm, The Welcoming Leader

Part FIVE

People First!
People Second ! People Third! People Fourth! People Fifth! People Sixth!

1/4096
“Business has to give people enriching, rewarding lives … or it's simply not worth doing.”
—Richard Branson

“You have to treat your employees like customers.” —Herb Kelleher, upon being asked his “secret to success”
Source: Joe Nocera, NYT, “Parting Words of an Airline Pioneer,”
on the occasion of Herb Kelleher’s retirement after 37 years at Southwest Airlines (SWA’s pilots union took out a full-page ad in USA Today
thanking HK for all he had done) ; across the way in Dallas, American Airlines’ pilots were picketing AA’s Annual Meeting)

"If you want staff to give great service, give great service to staff." —Ari Weinzweig, Zingerman's

"When I hire someone, that's when I go to work for them.” —John DiJulius, "What's the Secret to Providing a World-class Customer Experience"

“The path to a hostmanship culture paradoxically does not go through the guest. In fact it wouldn’t be totally wrong to say that the guest has nothing to do with it. True hostmanship leaders focus on their employees. What drives exceptionalism is finding the right people and getting them to love their work and see it as a passion. ... The guest comes into the picture only when you are ready to ask, ‘Would you prefer to stay at a hotel where the staff love their work or where management has made customers its highest priority?’” “We went through the hotel and made a ... ‘consideration renovation.’ Instead of redoing bathrooms, dining rooms, and guest rooms, we gave employees new uniforms, bought flowers and fruit, and changed colors. Our focus was totally on the staff. They were the ones we wanted to make happy. We wanted them to wake up every morning excited about a new day at work.” —Jan Gunnarsson and Olle Blohm, Hostmanship:
The Art of Making People Feel Welcome.

“ … The guest comes into the picture only when you are ready to ask, ‘Would you prefer to stay at a hotel where the staff love their work or where management has made customers its highest priority?’”

Brand = Talent.

Our Mission
To develop and manage talent;
to apply that talent,
throughout the world,
for the benefit of clients;
to do so in partnership;
to do so with profit.
WPP

… no less than Cathedrals in which the full and awesome power of the Imagination and Spirit and native Entrepreneurial flair of diverse individuals is unleashed in passionate pursuit of … Excellence.

Oath of Office: Managers/Servant Leaders
Our goal is to serve our customers brilliantly and profitably over
the long haul.
Serving our customers brilliantly and profitably over the long
haul is a product of brilliantly serving, over the long haul, the
people who serve the customer.
Hence, our job as leaders—the alpha and the omega and
everything in between—is abetting the sustained growth
and success and engagement and enthusiasm and
commitment to Excellence of those, one at a time, who
directly or indirectly serve the ultimate customer.
We—leaders of every stripe—are in the “Human Growth and
Development and Success and Aspiration to Excellence
business.”
“We” [leaders] only grow when “they” [each and every one of our colleagues] are
growing.
“We” [leaders] only succeed when “they” [each and every one of our colleagues]
are succeeding.
“We” [leaders] only energetically march toward Excellence when
“they” [each and every one of our colleagues] are energetically marching
toward Excellence.
Period.

“The leaders of Great Groups … love talent … and know where to find it. They … revel in … the talent of others.” —Warren Bennis & Patricia Ward Biederman, Organizing Genius

Les Wexner: From sweaters to people!*
*Limited Brands founder Les Wexner queried on astounding long-term success—said, in effect, it happened because he got
as excited about developing people as he had been about predicting fashion trends in his early years

TWO Per Year!

2/year = legacy.*
*Exec promotion = Acquisition

Promotion Decisions
“life and death decisions”
Source: Peter Drucker, The Practice of Management

“The ONE Question”: “In the last year [3 years, current job], name the … three people … whose growth you’ve most contributed to. Please explain where they were at the beginning of the year, where they are today, and where they are heading in the next 12 months. Please explain … in painstaking
detail … your development strategy in each case. Please tell me
your biggest development disappointment—looking back, could you or would you have done anything differently? Please tell me about your greatest development triumph—and disaster—in the last five years. What are the ‘three big things’ you’ve learned about helping people grow along the way?”

Difference #1

People are not “Standardized.” Their evaluations should not be standardized. Ever.

Standardized Evaluations?
Sports?*
Arts?*
*“Pure” talent-driven enterprises

Evaluating people = #1 differentiator
Source: Jack Welch/Jeff Immelt on GE’s #1
strategic skill (!!!!)

70 cents

“Development can help great people be even better—but if
I had a dollar to spend, I’d spend 70 cents getting the right person in the door.” —Paul Russell, Director, Leadership and Development, Google

“In short, hiring is the most important aspect of business and yet remains woefully misunderstood.”
Source: Wall Street Journal, 10.29.08,
review of Who: The A Method for Hiring,
Geoff Smart and Randy Street

15%

TP: “How to throw $500,000 into
the sea in one easy lesson!!”

< CAPEX
> People!*
*15%?

2X
Source: Container Store/Goal: increase average sale per shopper

The Sky Is the Limit!

No company ever Expended too much thought/ effort/ $$$$ on training!

The Sky Is the Limit!

Wegmans
Luiza Helena, Magazine Luiza

4 Words!

“The four most important words in any organization are …

The four most important words in any organization
are … “What do you think?”
Source: courtesy Dave Wheeler, posted at tompeters.com

8 Words!
12 Words!

Change the World With EIGHT Words
What do you think?*
How can I help?**
*Dave Wheeler: “What are the four most important words in the boss’ lexicon?”
**Boss as CHRO/Chief Hurdle Removal Officer **********************************

Change the World
With TWELVE Words
What do you think?*
How can I help?**
What have you learned?***
*Dave Wheeler: “What are the four most important words in the boss’ lexicon?”
**Boss as CHRO/Chief Hurdle Removal Officer **********************************
***What [new thing] have you learned [in the last 24 hours]? ********************* *

Some Help With Helping …
Help works when the recipient subsequently feels
smarter—not dumber.
Regularly help too soon—and you will set up expectation of inaction until your "help" is provided.
Help poorly conveyed spawns powerlessness
and resentment in recipient.
Helping requires a sniper's rifle or surgeon's
scalpel—not a shotgun or machete.
Helping strategies vary [significantly] from individual to individual—leave the “cookie cutter” at home.
Effectively "helping" may
be the most difficult leadership task of all!
"Help" is only truly successful when the recipient
says, and believes: "I did it myself!"
Near truism: Nobody wants help. But we would
all liked to have received help.
Guitarist Robert Fripp: "Don't be helpful. Be available.
Helpful people are a nuisance."

The Memories That Matter.

The Memories That Matter
The people you developed who went on to stellar accomplishments inside or outside
the company.
The (no more than) two or three people you developed who went on to
create stellar institutions of their own.
The long shots (people with “a certain something”) you bet on who
surprised themselves—and your peers.
The people of all stripes who 2/5/10/20 years
later say “You made a difference in my life,”
“Your belief in me changed everything.”
The sort of/character of people you hired in general. (And the bad
apples you chucked out despite some stellar traits.)
A handful of projects (a half dozen at most) you doggedly pursued that
still make you smile and which fundamentally changed the way
things are done inside or outside the company/industry.
The supercharged camaraderie of a handful of Great Teams aiming to
“change the world.”

The Memories That Matter
Created the sort of workplaces you’d like your kids to
inhabit. (Explicitly conscious of this “Would I want my
kids to work here?” litmus test.)
A “certifiable” “nut” about quality and safety and integrity. (More or
less regardless of any costs.)
A notable few circumstances where you resigned rather than
compromise your bedrock beliefs.
Perfectionism just short of the paralyzing variety.
A self- and relentlessly enforced group standard of
“EXCELLENCE-in-all-we-do”/“EXCELLENCE in our
behavior toward one another.”

The Age of “Brand You”!

Globalization1.0: Countries globalizing (1492-1800)
Globalization2.0: Companies globalizing (1800-2000)
Globalization3.0 (2000+): Individuals collaborating
& competing globally
Source: Tom Friedman/The World Is Flat

“If there is nothing very special about your work … no matter how hard you apply yourself you won’t get noticed, and that increasingly means you won’t get paid much either.”
—Michael Goldhaber, Wired

The Brand You50: Fifty Ways to Transform Yourself
from an “Employee” into a Brand That Shouts
Distinction, Commitment, and Passion!

"The illiterate of the 21st Century will not be those who cannot read or write, but those who cannot learn, unlearn and relearn." —Alvin Toffler

Part SIX

Leading

25

MBWA
Managing By Wandering Around/HP

You = Your calendar*
*The calendar never lies.

Your calendar knows Precisely what you
really care about.
Do you????

Don’t > Do*
* “Don’ting” must be systematic > WILLPOWER

“If there is any one ‘secret’ to effectiveness, it is concentration. Effective executives do first things first … and they do one thing at a time.” —Peter Drucker

50% (!)
Un-scheduled.

“Most managers spend a great deal of time thinking about what they plan to do, but relatively little time thinking about what they plan not to do. As a result, they become so caught up … in fighting the fires of the moment that they cannot really attend to the long-term threats and risks facing the organization. So the first soft skill of leadership the hard way is to cultivate the perspective of Marcus Aurelius: avoid busyness, free up your time, stay focused on what really matters. Let me put it bluntly: every leader should routinely keep a substantial portion of his or her time—I would say as much as 50 percent—unscheduled. … Only when you have substantial ‘slop’ in your schedule—unscheduled time—will you have the space to reflect on what you are doing, learn from experience, and recover from your inevitable mistakes. Leaders without such free time end up tackling issues only when there is an immediate or visible problem. Managers’ typical response to my argument about free time is, ‘That’s all well and good, but there are things I have to do.’ Yet we waste so much time in unproductive activity—it takes an enormous effort on the part of the leader to keep free time for the truly important things.” —Dov Frohman (& Robert Howard), Leadership The Hard Way: Why Leadership Can’t Be Taught—And How You
Can Learn It Anyway (Chapter 5, “The Soft Skills Of Hard Leadership”)

“It’s always showtime.”
—

“You must BE the change you wish to see in the world.”
Gandhi

“It’s always showtime.”
—David D’Alessandro, Career Warfare

“Nothing is so contagious as enthusiasm.”
—Samuel Taylor Coleridge

“The leader must have infectious optimism. … The final test of a leader is the feeling you have when you leave his presence after a conference. Have you a feeling of uplift and confidence?”
—Field Marshall Bernard Montgomery

Me first!

"Everyone thinks of changing the world, but no one thinks of changing himself." —Tolstoy

“Being aware of yourself and how you affect everyone around you is what distinguishes a superior leader.” —Edie Seashore (Strategy + Business #45)

“How can a high-level leader like _____ be so out of touch with the truth about himself? It’s more common than you would imagine. In fact, the higher up the ladder a leader climbs, the less accurate his self-assessment is likely to be. The problem is an acute lack of feedback [especially on people issues].”
—Daniel Goleman (et al.), The New Leaders

The “Have you …” 50

“Mapping your competitive position”
or …

1. Have you in the
last 10 days …
visited a customer?
2. Have you called a
customer … TODAY ?

1. Have you … in the last 10 days … visited a customer?
2. Have you called a customer … TODAY?
3. Have you in the last 60-90 days … had a seminar in which several folks from the customer’s operation (different levels, different functions, different divisions) interacted, via facilitator, with various of your folks?
4. Have you thanked a front-line employee for a small act of helpfulness … in the last three days?
5. Have you thanked a front-line employee for a small act of helpfulness … in the
last three hours?
6. Have you thanked a front-line employee for carrying around a great attitude … today?
7. Have you in the last week recognized—publicly—one of your folks for a small act of cross-functional co-operation?
8. Have you in the last week recognized—publicly—one of “their” folks (another function) for a small act of cross-functional co-operation?
9. Have you invited in the last month a leader of another function to your weekly team priorities meeting?
10. Have you personally in the last week-month called-visited an internal or external customer to sort out, inquire, or apologize for some little or big thing that went awry? (No reason for doing so? If true—in your mind—then you’re more out of touch than I dared imagine.)

K = R = P

“Courtesies of a small and trivial character are the ones which strike deepest in the grateful and appreciating heart.”
—Henry Clay,
American Statesman (1777-1852)

"Let's not forget that small emotions are the great captains of our lives." –—Van Gogh

Kindness =
Repeat Business =
Profit.

K = R = P/Kindness = Repeat business = Profit
Kindness:
Kind.
Thoughtful.
Decent.
Caring.
Attentive.
Engaged.
Listens well/obsessively.
Appreciative.
Open.
Visible.
Honest.
Responsive.
On time all the time.
Apologizes with dispatch for screw-ups.
“Over”-reacts to screw-ups of any magnitude.
“Professional” in all dealings.
Optimistic.
Understands that kindness to staff breeds kindness to others/outsiders.
Applies throughout the “supply chain.”
Applies to 100% of customer’s staff.
Explicit part of values statement.
Basis for evaluation of 100% of our staff.

Press Ganey Assoc: 139,380 former
patients from 225 hospitals:
none of THE top 15 factors determining Patient Satisfaction referred to patient’s health outcome.
Instead: directly related to Staff Interaction; directly correlated with Employee Satisfaction
Source: Putting Patients First, Susan Frampton, Laura Gilpin, Patrick Charmel

“There is a misconception that supportive interactions require more staff or more time and are therefore more costly. Although labor costs are a substantial part of any hospital budget, the interactions themselves add nothing to the budget. Kindness is free. Listening to patients or answering
their questions costs nothing. It can be argued that negative interactions—alienating patients, being non-responsive to
their needs or limiting their sense of control—can be very costly. … Angry, frustrated or frightened patients may be combative, withdrawn and less cooperative—requiring far
more time than it would have taken to interact with them initially in a positive way.”
Source: Putting Patients First, Susan Frampton, Laura Gilpin, Patrick Charmel
(Griffin Hospital/Derby CT; Plantree Alliance)

Acknowledgement/
Appreciation/
“Thank you!”

“The deepest principal in human nature is the craving* to be appreciated.”
—William James
*“Craving,” not “wish” or “desire” or “longing”/Dale Carnegie, How to Win
Friends and Influence People (“The BIG
Secret of Dealing With People”)

“The deepest urge
in human nature
is the desire to be important.” —John Dewey
(In Dale Carnegie, How to Win Friends and Influence People (“The BIG Secret of Dealing With People”)

“Acknowledge” … perhaps the most powerful word (and idea) in the English language—and manager’s tool kit!

“Employees who don't feel significant rarely make significant contributions.” —Mark Sanborn

Responsiveness/
Apology/
“I’m sorry!”

“I regard apologizing as the most magical, healing, restorative gesture human beings can make. It is the centerpiece of my work with executives who want to get better.”
—Marshall Goldsmith, What Got You Here Won’t Get You There:
How Successful People Become Even More Successful.

Relationships (of all varieties): THERE ONCE WAS A TIME WHEN A THREE-MINUTE PHONE CALL WOULD HAVE AVOIDED SETTING OFF THE DOWNWARD SPIRAL THAT RESULTED IN A COMPLETE RUPTURE.*
*divorce, loss of a BILLION $$$ aircraft sale, etc., etc.

THE PROBLEM IS RARELY/NEVER THE PROBLEM. THE RESPONSE TO
THE PROBLEM INVARIABLY ENDS UP BEING THE REAL PROBLEM.*
*PERCEPTION IS ALL THERE IS!

With a new and forthcoming policy on apologies … Toro, the lawn mower folks, reduced the average cost of settling a claim from $115,000 in 1991 to $35,000 in 2008 … and the company hasn’t been to trial in the last
15 years!

Part SEVEN

Excellence/
Aspiration/
Service/
Immoderation

1982-2012:
EXCELLENCE 30

Excellence1982: The Bedrock “Eight Basics”
1. A Bias for Action
2. Close to the Customer
3. Autonomy and Entrepreneurship
4. Productivity Through People
5. Hands On, Value-Driven
6. Stick to the Knitting
7. Simple Form, Lean Staff
8. Simultaneous Loose-Tight
Properties”

“Breakthrough” 82*
People!
Customers!
Action!
Values!
*In Search of Excellence

Hard is Soft.
Soft is Hard.

EXCELLENCE is not an "aspiration.”
EXCELLENCE is … THE NEXT FIVE MINUTES.

EXCELLENCE is not an "aspiration."
EXCELLENCE is … THE NEXT FIVE MINUTES.
EXCELLENCE is your next conversation.
Or not.
EXCELLENCE is your next meeting.
Or not.
EXCELLENCE is shutting up and listening—really listening.
Or not.
EXCELLENCE is your next customer contact.
Or not.
EXCELLENCE is saying “Thank you” for something “small.”
Or not.
EXCELLENCE is the next time you shoulder responsibility and apologize.
Or not.
EXCELLENCE is waaay over-reacting to a screw-up.
Or not.
EXCELLENCE is the flowers you brought to work today.
Or not.
EXCELLENCE is lending a hand to an “outsider” who’s fallen behind schedule.
Or not.
EXCELLENCE is bothering to learn the way folks in finance [or IS or HR] think.
Or not.
EXCELLENCE is waaay “over”-preparing for a 3-minute presentation.
Or not.
EXCELLENCE is turning “insignificant” tasks into models of … EXCELLENCE.
Or not.

2006 Novosibirsk:
Aspiration

Enterprise* (*at its best): An emotional, vital, innovative, joyful, creative, entrepreneurial endeavor that elicits maximum
concerted human
potential in the
wholehearted pursuit of EXCELLENCE in
service of others.**
**Employees, Customers, Suppliers, Communities, Owners, Temporary partners

2007 Sydney:
Service

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

7 Steps to Sustaining Success
You take care of the people.
The people take care of the service.
The service takes care of the customer.
The customer takes care of the profit.
The profit takes care of the re-investment.
The re-investment takes care of the re-invention.
The re-invention takes care of the future.
(And at every step the only measure is EXCELLENCE.)

7 Steps to Sustaining Success: And it starts with …
You take care of the people.

… no less than Cathedrals in which the full and awesome power of the Imagination and Spirit and native Entrepreneurial flair of diverse individuals is unleashed in passionate pursuit of … Excellence.

Immoderation

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 moderation!

Excellence. Always.
If not Excellence, what?
If not Excellence now, when?

Part Eight

Top 20

Top Twenty
**Just one “secret” to innovation: It’s a messy world. We’re always operating half informed. Hence, “try more stuff than the other guy” and sort it out as you go forward is best way to up success odds. (“Ready. Fire. Aim.”—Ross Perot)
**Paradox: Superb quality is an absolute necessity, and it requires superb systems; but superb quality with the wrong product flunks. Hence one needs to be organized (quality) and disorganized (innovation) at the same time. (Axiom: Management is art, not science.)
**Waste #1: “Great branding”/marketing can not overcome a lousy product—it is largely wasted. The product (innovative, attractive, of the highest quality) comes first—though excellence in product and marketing is indubitably required to achieve a smashing success.

Top Twenty
**Everywhere: “Excellence” in quality and design is not restricted to the “high end.” Both characteristics can be imbedded in lower-end products and services.
**Iron law: All organizations get worse as they become more and more enormous. No cultural differences.
**Iron law: Over the long haul, national success is largely built upon SMEs, with growth and innovation associated largely with a large population of vibrant midsized enterprises—Germany’s “Mittelstand” is exhibit #1.
**Paradox: Hierarchy is dead. Long live hierarchy. New market requirements and new tools can dramatically reduce hierarchy. Still, I don’t want to drive across a bridge that didn’t have a “command and control” structure to sign off on safety.

Top Twenty
**But: Hierarchy is often necessary—but relentless hot war must be declared on bureaucracy “24/7.”
**“New marketing techniques”: The newest marketing technique is the oldest marketing technique but remains “new” because it is seldom practiced with requisite intensity. Namely, get the hell out into the market place and listen & listen & listen to customers. Then listen some more.
**Always #1: Any nation’s Olympic team is as good as its athletes. (Duh.) Exactly the same is true with any (as in any!) organization: Investment in and development of great people comes first and is the greatest sustaining differentiator!
**Motivator #1: Treating people with respect is always the #1 motivational “tool.”

Top Twenty
**Why not business: In the army and in the theater and in sports, training is always Priority #1. Why not in business? No organization ever devoted too much effort to training!
**Success “secret” #1: Work harder/much harder than the other guy/s. There’s more to it than hard work but hard work is the sine qua non. (Again: Think of the Olympics.)
**Speed’s enabler: The #1 cause of delays is invariably lousy cross-functional communication—the product developers don’t talk to the logistics people who don’t talk to the sales people. Etc. Etc. Excellence in cross-functional communication must become a day-to-day top-management obsession.

Top Twenty
**New context, new leaders: Innovation (and execution) today is a collaborative process. Women are on average better leaders than men in collaborative situations. Men take to hierarchies—we invented ’em. Women tend to lead more by inclusion rather than coercion.
**Customer #1: In retail and in products designed for retail, she is the primary consumer. Company leadership and the product-service portfolio should mimic, more or less, this fact. (You heard it here 1st: Men and women are different.)
**New context, new skills; The Age of Brawn is largely behind us. Brains and creativity and flexibility have come to the fore. Not only are our organizations unprepared—but our schools get it more or less exactly wrong 100% of the time.