tom peters’ re-imagine excellence ! initially prepared for: e-town festival

Tom Peters’Tom Peters’

Re-ImagineRe-Imagine

EXCELLENCEEXCELLENCE!!Initially prepared for:Initially prepared for:

e-town Festivale-town FestivalEdmonton Economic DevelopmentEdmonton Economic Development

Edmonton/12 September 2014; modified & expanded 17 September 2014Edmonton/12 September 2014; modified & expanded 17 September 2014

(For more see tompeters.com and our fully annotated 23-part Master (For more see tompeters.com and our fully annotated 23-part Master Compendium [Mother of All Presentations] at excellencenow.com.)Compendium [Mother of All Presentations] at excellencenow.com.)

CONRAD HILTON …CONRAD HILTON …

CONRADCONRAD HILTONHILTON, at a gala celebrating, at a gala celebrating his career, was called to the podium and his career, was called to the podium and

asked,asked, “What were the most important

lessons you learned in your long and

distinguished career?” His answer …His answer …

““Remember Remember to tuck the to tuck the

shower curtain shower curtain inside the inside the bathtubbathtub.”.”

They come for “location, location, They come for “location, location,

location.” They … location.” They … COME COME BACKBACK … because of the tucked- … because of the tucked-

in shower curtain. in shower curtain.

(And [(And [ALLALL] the profit is made on ] the profit is made on

the return visits and recommendations the return visits and recommendations to others.)to others.)

““EXECUTION EXECUTION ISIS STRATEGY.”STRATEGY.”

—Fred Malek—Fred Malek

““Amateurs talk Amateurs talk about strategy. about strategy.

Professionals talk Professionals talk about logistics.”about logistics.”

——Omar Bradley, commander of American troops/D-DayOmar Bradley, commander of American troops/D-Day

““In real life, strategyIn real life, strategy is actually very is actually very

straightforward. straightforward. Pick a generalPick a general

direction direction … … andand imimpplementlement

likelike hellhell.”.” —Jack Welch—Jack Welch

““COSTCO FIGURED OUT COSTCO FIGURED OUT

THE THE BIGBIG,, SIMPLESIMPLE THINGS THINGS

AND AND EXECUTEDEXECUTED WITH TOTAL WITH TOTAL

FANATICISMFANATICISM.”.”

—Charles Munger, Berkshire Hathaway—Charles Munger, Berkshire Hathaway

““EXECUTIONEXECUTION IS IS THETHE JOBJOB OF OF

THE BUSINESS THE BUSINESS LEADERLEADER.”.”——Larry BossidyLarry Bossidy & Ram

Charan/ Execution: The Discipline of Getting Things Done

No matter how crazy and disruptive No matter how crazy and disruptive the times are … Execution Excellence is the times are … Execution Excellence is (as always) the sine qua non of success (as always) the sine qua non of success

and durability. and durability. BELIEVE ITBELIEVE IT..

EXCELLENCEEXCELLENCE!!

PeoplePeople!! CustomersCustomers!!

ActionAction!! ValuesValues!!

Excellence1982: The Bedrock “EiExcellence1982: The Bedrock “Eigght Basics”ht 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 PropertiesProperties

““Breakthrough” 82*Breakthrough” 82*

People! People! Customers! Customers!

Action! Action! ValuesValues! !

**In Search of ExcellenceIn Search of Excellence

In Search of ExcellenceIn Search of Excellence in … in … 44 words.words.

(No kidding.)(No kidding.)

EXCELLENCE is EXCELLENCE is notnot a “long- a “long-term” "aspiration.”term” "aspiration.”

EXCELLENCE is the ultimate EXCELLENCE is the ultimate short-term strategy. short-term strategy.

EXCELLENCE is … THEEXCELLENCE is … THE

NEXTNEXT 55 MINUTESMINUTES..**

(*Or NOT.)(*Or NOT.)

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

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

WHY WHY NOT?NOT?

““Why in the Why in the World did youWorld did you

go to go to SiberiaSiberia?”?”

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

concerted humanconcerted human potential in thepotential in the wholehearted pursuit of wholehearted pursuit of EXCELLENCE inEXCELLENCE in serviceservice of others of others.**

**Employees, Customers, Suppliers, Communities, Owners, Temporary partners**Employees, Customers, Suppliers, Communities, Owners, Temporary partners

Lecturing in Siberia. In April 2006. Lecturing in Siberia. In April 2006. Capitalism seeps into the farthest Capitalism seeps into the farthest corners of the world. corners of the world.

I laid out a vision for enterprise—at its I laid out a vision for enterprise—at its best.best.

I said there, and I say here:I said there, and I say here:

WHY NOT?WHY NOT?

PeoplePeoplePeoplePeople

PeoplePeople PeoplePeople

PeoplePeople

It’s as obvious as the end of one’s nose It’s as obvious as the end of one’s nose … but still honored in the breach far … but still honored in the breach far more often than not. People first more often than not. People first means people first. means people first. (And along the way (And along the way it’s the best way to boost profit and it’s the best way to boost profit and growth.)growth.)

People:People:1/4,0961/4,096

4,096 slides in my 23-part 4,096 slides in my 23-part MOAP/“Mother Of All Presentations,” MOAP/“Mother Of All Presentations,” three years in the making. ONE slide three years in the making. ONE slide by definition had to come first. This by definition had to come first. This one, with a quote from Richard one, with a quote from Richard

Branson, was Branson, was #1#1::

““Business has to Business has to give people give people enriching, enriching,

rewarding lives …rewarding lives …

1/4,096: excellencenow.com1/4,096: excellencenow.com

““Business has to give people enriching, Business has to give people enriching,

rewarding lives … rewarding lives … or it's or it's simsimppllyy not not

worth worth doindoing.”g.”

——Richard BransonRichard Branson

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

employees like employees like customers.”customers.” —Herb —Herb

Kelleher, upon being asked his “secret to success”Kelleher, 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 at on the occasion of Herb Kelleher’s retirement after 37 years at

Southwest Airlines Southwest Airlines (SWA’s pilots union took out a full-page ad in (SWA’s pilots union took out a full-page ad in USA USA TodayToday

thanking HK for all he had done) thanking HK for all he had done) ; across the way in Dallas, American ; across the way in Dallas, American Airlines’ pilots were Airlines’ pilots were picketingpicketing AA’s Annual Meeting)AA’s Annual Meeting)

““hostmanship”/hostmanship”/““consideration consideration

renovation”renovation”

““The path to a The path to a hostmanshihostmanshipp culture paradoxically does not go culture paradoxically does not go through the guest. In fact it wouldn’t be totally wrong to say that the guest has through the guest. In fact it wouldn’t be totally wrong to say that the guest has nothing to do with it.nothing to do with it. True hostmanship leaders focus on their employees. What True hostmanship leaders focus on their employees. What drives exceptionalism is finding the right people and getting them to love their 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 work and see it as a passion. ... The guest comes into the picture only when you are ready to ask, ‘are ready to ask, ‘Would you prefer to stay at a hotel where the staff love their Would you prefer to stay at a hotel where the staff love their

work or where management has made customers its highest priority?’”work or where management has made customers its highest priority?’” ““We We went throuwent througgh the hotel and made ah the hotel and made a ... ... ‘‘consideration renovation.consideration renovation.’’ Instead of Instead of redoinredoingg bathrooms, dinin bathrooms, dining g rooms, and rooms, and gguest rooms, we uest rooms, we ggave emave empploloyyees new ees new

uniforms, bouuniforms, bougght flowers and fruit, and ht flowers and fruit, and chanchangged colors.ed colors. Our focus was totallOur focus was totallyy on on the staff.the staff. TheTheyy were the ones we wanted were the ones we wanted to make hato make happy.ppy. We wanted them to wake up everWe wanted them to wake up everyy mornin morningg excited excited

about a new daabout a new dayy at work at work.” .” —Jan Gunnarsson and Olle Blohm, —Jan Gunnarsson and Olle Blohm, Hostmanship: Hostmanship: The Art of Making People Feel WelcomeThe Art of Making People Feel Welcome..

“ … “ … The guest comes into The guest comes into the picture only when you the picture only when you are ready to ask, are ready to ask, ‘‘Would Would you prefer to stay at a you prefer to stay at a

hotel where the staff love hotel where the staff love their work or where their work or where

management has made management has made customers its highest customers its highest

priority?’priority?’””

Ponder this.Ponder this.

P-L-E-A-S-E.P-L-E-A-S-E.(Take your time.)(Take your time.)

EMPLOYEES FIRST, CUSTOMERS SECOND:EMPLOYEES FIRST, CUSTOMERS SECOND:Turning Conventional Management Upside Turning Conventional Management Upside

DownDownVineet Nayar/CEO/HCL TechnologiesVineet Nayar/CEO/HCL Technologies

Rocket Science. Rocket Science. NOT.NOT.

““If you want staff to If you want staff to give great service, give great service, give great service give great service

to staff.” to staff.” ——Ari Weinzweig, Zingerman’s Ari Weinzweig, Zingerman’s

Source: Source: Small Giants: Companies That Choose to Be Small Giants: Companies That Choose to Be Great Instead of Big, Great Instead of Big, Bo BurlinghamBo Burlingham

EXCELLENT EXCELLENT customer experiencecustomer experiencedepends … depends … entirely …entirely …

onon EXCELLENT EXCELLENT employee experience!employee experience!

If you want to WOW your If you want to WOW your

customers, customers, FIRSTFIRST you you must WOW those whomust WOW those who WOW the customers!WOW the customers!

I repeat. This is I repeat. This is NOTNOT

rocket science.rocket science.

Wegmans Wegmans (was #1/Best Company to Work For in USA)(was #1/Best Company to Work For in USA)

Container Store Container Store (was #1/Best Company to Work For in USA)(was #1/Best Company to Work For in USA)

Whole FoodsWhole FoodsCostcoCostcoPublixPublix

Darden RestaurantsDarden RestaurantsBuild-A-Bear Build-A-Bear WorkshopsWorkshopsStarbucksStarbucks

““They” say you can’t do this “people They” say you can’t do this “people stuff” in the likes of retail.stuff” in the likes of retail.

NONSENSENONSENSE. .

These were a few of the These were a few of the retailers retailers on on the most recent list of “100 Best the most recent list of “100 Best Companies to Work for in America.” In Companies to Work for in America.” In the past,the past,a couple of these companies were in a couple of these companies were in

fact fact #1#1..

““Contrary to conventional Contrary to conventional corporate thinking, treating corporate thinking, treating retail workers much better retail workers much better

may make everyone may make everyone (including their employers) (including their employers)

much richer.”much richer.” * *** **

**DuhDuh!!**Cited in particular, **Cited in particular, The Good Jobs StrategyThe Good Jobs Strategy, by M.I.T. professor Zeynep , by M.I.T. professor Zeynep

Ton.Ton.

DuhDuh!!

The Good Jobs Strategy: The Good Jobs Strategy: How the Smartest How the Smartest

Companies Invest in Companies Invest in Employees to Lower Costs Employees to Lower Costs & Boost Profits& Boost Profits —Zeynep Ton, MIT Sloan School—Zeynep Ton, MIT Sloan School

Notes: Cases all retail, include Costco and Trader Joe’s. Notes: Cases all retail, include Costco and Trader Joe’s.

E.g., Costco: Average hourly pay E.g., Costco: Average hourly pay $20.89$20.89—40% greater —40% greater than #1 competitor, Sam’s Club. than #1 competitor, Sam’s Club.

Read this.Read this.

““In a world where customers wake up In a world where customers wake up every morning asking, ‘What’s new, every morning asking, ‘What’s new, what’s different, what’s amazing?’ what’s different, what’s amazing?’

success desuccess deppends on a ends on a comcomppananyy’s abilit’s abilityy to unleash to unleash initiative, imainitiative, imaggination and ination and ppassion of emassion of empploloyyees at all ees at all

levelslevels —and this can only happen if all —and this can only happen if all those folks are connected heart and soul those folks are connected heart and soul

to their work [their ‘calling’], their to their work [their ‘calling’], their company and their mission.”company and their mission.” —John Mackey and —John Mackey and

Raj Sisoda,Raj Sisoda, Conscious Capitalism: Conscious Capitalism: Liberating the Heroic Spirit of BusinessLiberating the Heroic Spirit of Business

Mackey is the CEO/founder of Mackey is the CEO/founder of Whole Whole FoodsFoods. .

(The book is a gem; I’ve given close to 50 (The book is a gem; I’ve given close to 50 copies away.)copies away.)

Brand Brand = =

Talent.Talent.

Our Mission

TO DEVELOP AND MANAGE TALENT;TO DEVELOP AND MANAGE 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

Profit ROCKS.Profit ROCKS.

Profit is: Profit is: DERIVATIVEDERIVATIVE..

Les Wexner:Les Wexner: FROM FROM FASHION TRENDS GURU FASHION TRENDS GURU

TO KICKS FROM TO KICKS FROM PICKING/DEVELOPING PICKING/DEVELOPING

PEOPLE!*PEOPLE!**Limited Brands founder Les Wexner queried*Limited Brands founder Les Wexner queried

on astounding longterm growth & profitability:on astounding longterm growth & profitability: It happened because It happened because “I got as excited “I got as excited

about developing people”about developing people” as he had been as he had been about predicting fashion trends in his early about predicting fashion trends in his early

years.years.

““G-E-N-I-U-S”G-E-N-I-U-S”Getting more and more cantankerous (short tempered!)Getting more and more cantankerous (short tempered!)

about this:about this: Job #1Job #1 (& #2 & #3)(& #2 & #3) is to abet peoples' personal is to abet peoples' personal

growth. All other good things growth. All other good things flow there from.flow there from.My idea of a gen-u-ine "genius“My idea of a gen-u-ine "genius“

"breakthrough" idea:"breakthrough" idea: If If yyou work ou work yyour our heart out to helheart out to helpp ppeoeopple le ggrow, row,

thetheyy'll work their hearts out'll work their hearts out to to ggive customers a ive customers a ggreat reat

exexpperienceerience..

I repeat. This is I repeat. This is NOTNOT

rocket science.rocket science.

"When I hire "When I hire someone, that's someone, that's

when when I I ggo to o to work for work for

themthem.”.” —John DiJulius,—John DiJulius, "What's the Secret to "What's the Secret to

Providing a World-class Customer Experience"Providing a World-class Customer Experience"

DDODDOs/s/Deliberately Developmental OrganizationsDeliberately Developmental Organizations

““These companies operate on the These companies operate on the foundational assumptions that adultsfoundational assumptions that adults

can grow, that not only is attention to the can grow, that not only is attention to the bottom line and the personal growth of all bottom line and the personal growth of all

employees desirable, but the two are employees desirable, but the two are interdependent.interdependent. Both profitability and individual Both profitability and individual

development rely on structures that are built into every development rely on structures that are built into every aspect of how the company operates. … Decurion and aspect of how the company operates. … Decurion and

Bridgewater [cases] offer a form of proof that the quest Bridgewater [cases] offer a form of proof that the quest for business excellence and the search for personal for business excellence and the search for personal

realization need not be mutually exclusive—and can, in realization need not be mutually exclusive—and can, in fact, be essential to each other.”fact, be essential to each other.”

E.g., At Bridgewater Associates, every employee (new hire E.g., At Bridgewater Associates, every employee (new hire

to CEO) has a to CEO) has a “crew”“crew” that “supports his or her growth, that “supports his or her growth, both professionally and personally.”both professionally and personally.”

Source: “Making Business Personal,” Robert Kegan et al., Source: “Making Business Personal,” Robert Kegan et al., HBRHBR/04.14/04.14

DDODDO is a is a “WOW!” “WOW!” in my book—and in my book—and this this isis my “book.” my “book.”

““I start with the I start with the premise that the premise that the

function of function of leadership is to leadership is to pproduce more roduce more

leadersleaders, not more , not more followers.”followers.” ——Ralph NaderRalph Nader

““I didn’t have a ‘mission I didn’t have a ‘mission statement’ at Burger King. I had statement’ at Burger King. I had

a dream. Very simple. It was a dream. Very simple. It was something like, something like, ‘‘BurBurgger Kiner Kingg is is 250,000 250,000 ppeoeopple, everle, everyy one of one of

whom whom ggives a shitives a shit.’.’ Every Every one. Accounting. Systems. Not one. Accounting. Systems. Not

just the drive through. Everyone just the drive through. Everyone is ‘in the brand.’ That’s what is ‘in the brand.’ That’s what we’re talking about, nothing we’re talking about, nothing

less.”less.”— Barry Gibbons— Barry Gibbons

THE DREAM MANAGERTHE DREAM MANAGER — by Matthew Kelly— by Matthew Kelly

““AN ORGANIZATION CAN ONLY BECOME THE-AN ORGANIZATION CAN ONLY BECOME THE-BEST-VERSION-OF-ITSELF TO THE EXTENT THAT BEST-VERSION-OF-ITSELF TO THE EXTENT THAT THE PEOPLE WHO DRIVE THAT ORGANIZATION THE PEOPLE WHO DRIVE THAT ORGANIZATION ARE STRIVING TO BECOME BETTER-VERSIONS-ARE STRIVING TO BECOME BETTER-VERSIONS-OF-THEMSELVES.”OF-THEMSELVES.” “A company’s purpose is to become “A company’s purpose is to become

the-best-version-of-itself. The question is: What is an the-best-version-of-itself. The question is: What is an employee’s purpose? Most would say, ‘to help the company employee’s purpose? Most would say, ‘to help the company

achieve its purpose’—achieve its purpose’—but thebut theyy would be wron would be wrong. That is certainly g. That is certainly part of the employee’s role, but an employee’s primary purpose part of the employee’s role, but an employee’s primary purpose is to become the-best-version-of-himself or –herself. … When a is to become the-best-version-of-himself or –herself. … When a company forgets that it exists to serve customers, it quickly company forgets that it exists to serve customers, it quickly

goes out of business.goes out of business. OUR EMPLOYEES ARE OUR OUR EMPLOYEES ARE OUR FIRST CUSTOMERS, AND OUR MOST IMPORTANT FIRST CUSTOMERS, AND OUR MOST IMPORTANT

CUSTOMERS.”CUSTOMERS.”

EVERYEVERY employee has a dream … related to employee has a dream … related to their current job or not. their current job or not.

FocusinFocusing g on helpinon helpingg em empploloyyees attain those ees attain those dreams (which may not be job related) is dreams (which may not be job related) is simply the best wasimply the best wayy to create an to create an environment where emploenvironment where employyees strive to ees strive to imimpprove themselves more or less each and rove themselves more or less each and evereveryy da day—y—and in the and in the pprocess serve each rocess serve each otherother,,and the Client, with verveand the Client, with verve..

(Admission: At first glance I thought “how silly.” At 3rd (Admission: At first glance I thought “how silly.” At 3rd through 10th glance I thought … “pure genius.”) (through 10th glance I thought … “pure genius.”) (The The Dream ManagerDream Manager, presented in parable form, is based on a , presented in parable form, is based on a wildly successful industrial cleaning services company. I was wildly successful industrial cleaning services company. I was fortunate to meet the publicity-shy CEO.)fortunate to meet the publicity-shy CEO.)

Training = Training = InvestmentInvestment

#1#1!!

#1#1 = = #1#1***Damn it!*Damn it!

6/2/36/2/3**

*It takes Jerry Seinfeld *It takes Jerry Seinfeld SIX SIX MONTHSMONTHS to develop to develop

TWO TWO oror THREE THREE MINUTESMINUTES of new material of new material (documentary: (documentary: ComedianComedian))

He’s the quintessential “old pro.” No He’s the quintessential “old pro.” No

matter. He still … matter. He still … trains and trains and trains and trains and trains and trains and trains some more. trains some more. (Most (Most of the “training gigs” are performed in of the “training gigs” are performed in small, out-of-the-way places.)small, out-of-the-way places.)

2X2X

Recession comes. Most retailers cut Recession comes. Most retailers cut back on training to save money. back on training to save money.

CONTAINER STORE CONTAINER STORE doublesdoubles

training for in-store customer-contact training for in-store customer-contact employees.employees.

Basketball coach John Wooden, perhaps the best coach of Basketball coach John Wooden, perhaps the best coach of

anything, ever:anything, ever: “I was never “I was never much of a game coach, much of a game coach, but I was a pretty good but I was a pretty good

practice coach.”practice coach.”

Hall of fame football coach Bill Walsh on preparation:Hall of fame football coach Bill Walsh on preparation:

““The score takes care The score takes care of itself.”of itself.”

In the Army, In the Army, 33--star star ggeneralsenerals worry about worry about

training. In most training. In most businesses, it's a businesses, it's a

“ho-hum” mid-level “ho-hum” mid-level staff function.staff function.

Why is intensive-Why is intensive-extensive training extensive training

obvious for the army & obvious for the army & navy & sports teams & navy & sports teams &

performing arts performing arts

groups--but groups--but not for for

the average business?the average business?

Is your Is your CTOCTO/Chief /Chief Training Officer your top Training Officer your top paid “C-level” job (other paid “C-level” job (other

than CEO/COO)?than CEO/COO)?

Are your top trainers Are your top trainers paid/cherished as much paid/cherished as much as your top marketers/ as your top marketers/

engineers?engineers?

Most firms don’t even have a “CTO.”Most firms don’t even have a “CTO.”For shame.For shame.

Is your CTO/Chief Training Officer your top paid “C-level” job (other than CEO/COO)?Is your CTO/Chief Training Officer your top paid “C-level” job (other than CEO/COO)?If not, why not?If not, why not?Are your top trainers paid as much as your top marketers and engineers?Are your top trainers paid as much as your top marketers and engineers?If not, why not?If not, why not?

Are your training Are your training courses so good courses so good they make you they make you giggle and tingle?giggle and tingle?If not, why not?If not, why not?Randomly stop an employee in the hall: Can she/he meticulously describe her/his development plan for the next Randomly stop an employee in the hall: Can she/he meticulously describe her/his development plan for the next 12 months?12 months?If not, why not?If not, why not?Why is your world of business any different than the (competitive) world of rugby, football, opera, theater, Why is your world of business any different than the (competitive) world of rugby, football, opera, theater, the military?the military?If “people/talent first” and hyper-intense continuous training are laughably obviously for them, why not you? If “people/talent first” and hyper-intense continuous training are laughably obviously for them, why not you?

Training often doesn’t get the Training often doesn’t get the attention it ought to get because the attention it ought to get because the training course portfolio is far from training course portfolio is far from scintillating.scintillating.

I believe the aim must be … I believe the aim must be …

UNADULTERATED UNADULTERATED EXCELLENCE & WOW EXCELLENCE & WOW IN EVERY TRAINING IN EVERY TRAINING OFFERING.OFFERING.(Damn it.)(Damn it.)(I repeat: Damn it.)(I repeat: Damn it.)

(Someone at a seminar challenged me on this. Said it was (Someone at a seminar challenged me on this. Said it was unrealistic and, by the way, what does “tingle” mean. I pointed unrealistic and, by the way, what does “tingle” mean. I pointed to my sophomore year in college. For us engineers, including to my sophomore year in college. For us engineers, including civil engineers like me, an introductory chemistry course was civil engineers like me, an introductory chemistry course was required. Most of us looked forward to it as the equivalent of a required. Most of us looked forward to it as the equivalent of a 4-month long root canal. We had two well known professors, 4-month long root canal. We had two well known professors, Michell Sienko and Robert Plane. They were scholars of the Michell Sienko and Robert Plane. They were scholars of the first order and simultaneously entertainers of the first order. first order and simultaneously entertainers of the first order. Bottom line: By the end of the course, probably half of us Bottom line: By the end of the course, probably half of us (among hundreds) wanted to be chemistry majors. Ten years (among hundreds) wanted to be chemistry majors. Ten years later the same sort of lightning struck courtesy an econ prof, later the same sort of lightning struck courtesy an econ prof, Keith Lumsden, at the Stanford business school. That is, there Keith Lumsden, at the Stanford business school. That is, there are great teachers and great courses—and I do not understand are great teachers and great courses—and I do not understand why the corporate world can’t develop or recruit the Sienkos why the corporate world can’t develop or recruit the Sienkos and Planes and Lumsdens. Billions are at stake—and great and Planes and Lumsdens. Billions are at stake—and great “profs” concocting great courses could do wonders to, say, “profs” concocting great courses could do wonders to, say, recruitment and retention and productivity. As to “tingle,” I’m recruitment and retention and productivity. As to “tingle,” I’m looking for something beyond “very good”; I’d accept for looking for something beyond “very good”; I’d accept for “earthshaking” or “mind-blowing” or, for sure … “earthshaking” or “mind-blowing” or, for sure … “supercalifragilisticexpialidocious.”)“supercalifragilisticexpialidocious.”)

Is your CTO/Chief Training Officer your top paid “C-level” job (other than CEO/COO)?Is your CTO/Chief Training Officer your top paid “C-level” job (other than CEO/COO)?If not, why not?If not, why not?

Are your top trainers paid as much as your top marketers and engineers?Are your top trainers paid as much as your top marketers and engineers?If not, why not?If not, why not?

Are your traiAre your training courses so good they make you giggle and tingle?ning courses so good they make you giggle and tingle?If not, why not?If not, why not?

Randomly stop an employee Randomly stop an employee in the hall: Can she/he in the hall: Can she/he meticulously describe meticulously describe her/his development plan her/his development plan for the next 12 months?for the next 12 months?If not, why not?If not, why not?

Why is your world of business any different than the (competitive) world of rugby, football, Why is your world of business any different than the (competitive) world of rugby, football, opera, theater, opera, theater, the military?the military?If “people/talent first” and hyper-intense continuous training are laughably obviously for If “people/talent first” and hyper-intense continuous training are laughably obviously for them, why not you? them, why not you?

And if the answer is “No” … And if the answer is “No” … her or her or his boss should be sternly his boss should be sternly reprimanded ASAPreprimanded ASAP.. (I would (I would say “fired”—but you might accuse me say “fired”—but you might accuse me of over-the-top-ism.)of over-the-top-ism.)

Gamblin’ ManGamblin’ Man

Bet #1: Bet #1: >> 5 of 10 CEOs see >> 5 of 10 CEOs see training as expense rather training as expense rather than investment.than investment.Bet #2: Bet #2: >> 5 of 10 CEOs see >> 5 of 10 CEOs see training as defense rather training as defense rather than offense.than offense.Bet #3: Bet #3: >> 5 of 10 CEOs see >> 5 of 10 CEOs see training as “necessary evil” training as “necessary evil” rather than “strategic rather than “strategic opportunity.”opportunity.”

Bet #4:Bet #4: >> 8 of 10 >> 8 of 10 CEOs, in 45-min CEOs, in 45-min “tour d’horizon” “tour d’horizon” of their biz, would of their biz, would NOTNOT mention mention training.training.

My odds are not speculative. I’ve My odds are not speculative. I’ve tested this. (Alas.)tested this. (Alas.)

What is the best reason to go What is the best reason to go bananas over training? bananas over training?

GREED.GREED. (It pays off.) (It pays off.)

(Training should be an official part of the (Training should be an official part of the

R&DR&D budget and a capital expense.) budget and a capital expense.)

Training #1: Bottom LineTraining #1: Bottom Line

NOBODYNOBODY gets off the gets off the

hook! “Training & Development hook! “Training & Development Maniac” applies as much to the Maniac” applies as much to the

leader of the leader of the 4-person 4-person businessbusiness as to the chief of as to the chief of the 44,444-person business.the 44,444-person business.

This rant on training is not particularly This rant on training is not particularly aimed at big companies. My target is …aimed at big companies. My target is …

ALL COMPANIES/ALL COMPANIES/ORGANIZATIONS.ORGANIZATIONS.(No exceptions.)(No exceptions.)

““training, training, TRAINING and TRAINING and

M-O-R-E M-O-R-E T-R-A-I-N-I-N-G”T-R-A-I-N-I-N-G”

——CINCPAC Nimitz to CNO KingCINCPAC Nimitz to CNO King/1943/1943(punctuation Nimitz’s); when Pearl Harbor occurred,(punctuation Nimitz’s); when Pearl Harbor occurred,

U.S. Navy preparation was found wanting—the crews’ U.S. Navy preparation was found wanting—the crews’ training was more important than the number of training was more important than the number of

available war ships.available war ships.

I am more or less … I am more or less …

purple purple with ragewith rage

… … at the generic disregard of training at the generic disregard of training in the private sector.in the private sector.

HiringHiring

““Development can help great Development can help great

people be even people be even better— better— but if but if I had a dollar to spend, I’d I had a dollar to spend, I’d

spendspend 7070 cents cents getting the right person getting the right person

in the door.”in the door.” ——Paul Russell, Director, Leadership and Paul Russell, Director, Leadership and

Development, GoogleDevelopment, Google

““In short, hiring is In short, hiring is the the most immost impportant ortant

asasppect of businessect of business

and yet remainsand yet remains woefully woefully misunderstoodmisunderstood..””

Source: Source: Wall Street JournalWall Street Journal, 10.29.08,, 10.29.08,

review of review of Who: The A Method for Hiring, Who: The A Method for Hiring, Geoff Smart and Randy StreetGeoff Smart and Randy Street

So do you consider yourself a full-bore So do you consider yourself a full-bore

… … PROFESSIONALPROFESSIONAL … when … when it comes to hiring? (Take care in it comes to hiring? (Take care in answering, please.)answering, please.)

““It’s simple, really, It’s simple, really,

Tom. Hire forTom. Hire for s, s, and, and, aboveabove allall, ,

ppromoteromote for for s.”s.” —Starbucks regional manager,

on why so many smiles at Starbucks shops

Put it (e.g., the likes of Put it (e.g., the likes of “smiles in a way that “smiles in a way that

lights up a room”) in the lights up a room”) in the

FORMALFORMAL criteria criteria

list. list. DAMN IT!DAMN IT!

AndrewAndrew CarneCarneggieie’s Tombstone Inscription …’s Tombstone Inscription …

Here lies a manHere lies a manWho knew how to enlistWho knew how to enlist

In his serviceIn his serviceBetter men than himself.Better men than himself.

Source: Peter Drucker, Source: Peter Drucker, The Practice of ManagementThe Practice of Management

QuietQuiet

Susan Cain’s Susan Cain’s Quiet: The Power of Introverts Quiet: The Power of Introverts in a World That Can’t Stop Talkingin a World That Can’t Stop Talking made a made a profound impact on me. We tend to favor profound impact on me. We tend to favor the “noisy ones”—and thence downplay the the “noisy ones”—and thence downplay the power of the 50% amongst us who are “the power of the 50% amongst us who are “the quiet ones.”quiet ones.”

I.e., we blow off (or, at least, undervalue) I.e., we blow off (or, at least, undervalue)

50%50% 0f the talent pool. 0f the talent pool.

““We live with a value system that I call the Extrovert Ideal—the We live with a value system that I call the Extrovert Ideal—the omnipresent belief that the ideal self is gregarious, alpha, and omnipresent belief that the ideal self is gregarious, alpha, and

comfortable in the spotlight. The archetypal extrovert prefers action comfortable in the spotlight. The archetypal extrovert prefers action to contemplation, risk-taking to heed-taking, certainty to doubt. … We to contemplation, risk-taking to heed-taking, certainty to doubt. … We think that we value individuality, but all too often we admire one type think that we value individuality, but all too often we admire one type of individual … Introversion is now a second-class personality trait. … of individual … Introversion is now a second-class personality trait. …

The Extrovert Ideal has been documented in many The Extrovert Ideal has been documented in many studies. Talkative people, for example, are rated as studies. Talkative people, for example, are rated as smarter, better looking, more interesting, and more smarter, better looking, more interesting, and more

desirable as friends. Velocity of speech counts as well desirable as friends. Velocity of speech counts as well as volume: We rank fast talkers as more competent and as volume: We rank fast talkers as more competent and likeable than slow ones. But we make a grave mistake likeable than slow ones. But we make a grave mistake to embrace the Extrovert Ideal so unthinkingly.to embrace the Extrovert Ideal so unthinkingly. … As the … As the

science journalist Winifred Gallagher writes, ‘The glory of the science journalist Winifred Gallagher writes, ‘The glory of the disposition that stops to consider stimuli rather than rushing to disposition that stops to consider stimuli rather than rushing to

engage with them is its long association with intellectual and artistic engage with them is its long association with intellectual and artistic achievement. Neither E = mc squared or Paradise Lost was dashed off achievement. Neither E = mc squared or Paradise Lost was dashed off by a party animal.’ Even in less obviously introverted occupations, like by a party animal.’ Even in less obviously introverted occupations, like

finance, politics, and activism, some of the greatest leaps forward finance, politics, and activism, some of the greatest leaps forward were made by introverts … figures like Eleanor Roosevelt, Warren were made by introverts … figures like Eleanor Roosevelt, Warren

Buffett and Gandhi achieved what they did not in spite of but because Buffett and Gandhi achieved what they did not in spite of but because of their introversion.”of their introversion.” — —Susan Cain, Susan Cain,

Quiet: The Power of Introverts in a World That Can’t Stop TalkingQuiet: The Power of Introverts in a World That Can’t Stop Talking

““The next time you see a The next time you see a person with a composed face person with a composed face and a soft voice, remember and a soft voice, remember

that inside her mind she that inside her mind she might be solving an might be solving an

equation, composing a equation, composing a sonnet, designing a hat. She sonnet, designing a hat. She might, that is, be deploying might, that is, be deploying

the power of quiet.”the power of quiet.” — —Susan Cain, Susan Cain,

Quiet: The Power of Introverts in a World That Can’t Stop TalkingQuiet: The Power of Introverts in a World That Can’t Stop Talking

2/Year = 2/Year = LegacyLegacy

Your legacy is achieved and Your legacy is achieved and maintained to a great extent by your maintained to a great extent by your promotion decisions—about two per promotion decisions—about two per year on average. In a five-year stint, year on average. In a five-year stint, that’s 10 decisions that make or break that’s 10 decisions that make or break you.you.

DO YOU ACT DO YOU ACT ACCORDINGLY?ACCORDINGLY? (No glib answer, please.)(No glib answer, please.)

Promotion DecisionsPromotion Decisions

“life and “life and death death

decisions”decisions”Source: Peter Drucker, Source: Peter Drucker, The Practice of ManagementThe Practice of Management

A promotion decision is akin to an A promotion decision is akin to an acquisition decision. The same degree acquisition decision. The same degree of care therewith should be exercised.of care therewith should be exercised.

““A man should A man should nevernever be promoted to a be promoted to a

managerial position if his managerial position if his vision focuses on people’s vision focuses on people’s

weaknesses rather rather than on their than on their

strengths.”.” —Peter Drucker, —Peter Drucker, The Practice of ManagementThe Practice of Management

EvaluationEvaluation

EVALUATING EVALUATING

PEOPLE = PEOPLE = #1#1

DIFFERENTIATORDIFFERENTIATORSource: Jack Welch, now Jeff Immelt onSource: Jack Welch, now Jeff Immelt on

GE’s top strategic skill ( GE’s top strategic skill (!!!!!!!!))

““In most companies, the Talent Review Process is a In most companies, the Talent Review Process is a farce. At GE, Jack Welch and his two top HR people farce. At GE, Jack Welch and his two top HR people

visit each division for a day. They review the top 20 to visit each division for a day. They review the top 20 to 50 people by name. They talk about Talent Pool 50 people by name. They talk about Talent Pool

strengthening issues.strengthening issues. The Talent The Talent Review Process is a Review Process is a contact scontact spport at GE;ort at GE;

it has the intensitit has the intensityy and and the imthe impportance of the ortance of the

budbudgget et pprocess at most rocess at most comcomppaniesanies.”.” —Ed Michaels, —Ed Michaels, War for TalentWar for Talent

A mouthful, eh?A mouthful, eh?

SelfSelf--EvaluationEvaluation

““To develop To develop others, start others, start

with with yyourselfourself.”.”

—Marshall Goldsmith—Marshall Goldsmith

““Being aware of Being aware of yourself yourself and how and how yyou ou

affect everaffect everyyone around one around yyouou is what is what

distindistingguishesuishes a superior a superior leader.”leader.”

—Edie Seashore (—Edie Seashore (strategy + businessstrategy + business #45) #45)

““Work Work on me on me firstfirst.”.”

—Kerry Patterson, Joseph Grenny, Ron McMillan and Al Switzler/Crucial Conversations

““Leadership Leadership isis self-knowledge. self-knowledge. Successful leaders are those who are Successful leaders are those who are conscious about their behavior andconscious about their behavior and

the impact it has on the people the impact it has on the people around them. They are willing to around them. They are willing to

examine what behaviors of their own examine what behaviors of their own may be getting in the way. … The may be getting in the way. … The

toughest person you will ever lead is toughest person you will ever lead is yourself. yourself. We can’t effectivelWe can’t effectivelyy lead lead

others unless we can lead ourselvesothers unless we can lead ourselves.”.”

——Betsy Myers, Betsy Myers, Take the Lead: Motivate, Inspire, Take the Lead: Motivate, Inspire, and Bring Out the Best in Yourself and Everyone Around Youand Bring Out the Best in Yourself and Everyone Around You

““How can a high-level leader like _____ How can a high-level leader like _____ be so out of touch with the truth about be so out of touch with the truth about

himself? It’s more common than you himself? It’s more common than you

would imagine. 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 The problem is an acute lack of feedback [especially on people issues].”feedback [especially on people issues].”

—Daniel Goleman (et al.), —Daniel Goleman (et al.), The New LeadersThe New Leaders

"Everyone thinks "Everyone thinks of changing the of changing the

world, but no one world, but no one thinks of thinks of changing changing

himself." himself." - Leo Tolstoy- Leo Tolstoy

The leadership gurus speak with one The leadership gurus speak with one voice on this. Self-knowledge and self-voice on this. Self-knowledge and self-development is leader job #1.development is leader job #1.

Think about it.Think about it.

11stst-Line Bosses -Line Bosses (Cadre of) = (Cadre of) =

Productivity Asset Productivity Asset

#1#1!!

If the regimental commander lost most of his If the regimental commander lost most of his 2nd lieutenants and 1st lieutenants and 2nd lieutenants and 1st lieutenants and

captains and majors, it would be a tragedy. captains and majors, it would be a tragedy.

If he lost his If he lost his serserggeants it would eants it would be a catastrobe a catastropphehe. . The The

Army and the Navy are fully aware that Army and the Navy are fully aware that success on the battlefield is dependent to an success on the battlefield is dependent to an extraordinary degree on its Sergeants and extraordinary degree on its Sergeants and Chief Petty Officers. Does industry have the Chief Petty Officers. Does industry have the

same awareness?same awareness?

““In great armies, the In great armies, the job of generals is to job of generals is to

back up their back up their sergeants.”sergeants.”

—COL Tom Wilhelm, from Robert Kaplan, —COL Tom Wilhelm, from Robert Kaplan, “The Man Who Would Be Khan,” “The Man Who Would Be Khan,” The AtlanticThe Atlantic

Employee retention Employee retention && satisfaction satisfaction && productivity: productivity: OverwhelminOverwhelminggllyy

based on the based on the

first-line first-line manamanagger!er!

Source: Marcus Buckingham & Curt Coffman, Source: Marcus Buckingham & Curt Coffman, First, Break All the First, Break All the Rules: What the World’s Greatest Managers Do DifferentlyRules: What the World’s Greatest Managers Do Differently

““People People leave leave

manamanaggersers not not companies.”companies.”

——Dave WheelerDave Wheeler

Actually, a profound statement of the Actually, a profound statement of the utmost importance.utmost importance.

Is there Is there ONEONE “secret” “secret” to productivity and to productivity and

employee satisfaction?employee satisfaction?

YESYES!!

The Quality of your The Quality of your FULLFULL CADRECADRE of … of …1st-line Leaders.1st-line Leaders.

No way to overstate here. Companies No way to overstate here. Companies do do pay attention to 1st-line supervisors—pay attention to 1st-line supervisors—but do not/rarely consider the full cadre but do not/rarely consider the full cadre

of 1st-line leaders a … of 1st-line leaders a … 11stst--ORDER ORDER STRATEGIC ASSETSTRATEGIC ASSET

… worthy of stupendous investment in … worthy of stupendous investment in selection and development.selection and development.

(PLEASE PONDER THIS.)(PLEASE PONDER THIS.)

E.g.: Do you have the ...E.g.: Do you have the ... ABSOLUTEABSOLUTE BEST BEST TRAINING & TRAINING & DEVELOPMENT DEVELOPMENT PROGRAMSPROGRAMSIN THE INDUSTRYIN THE INDUSTRY ... ...

(or some subset thereof)(or some subset thereof) for first-line supervisors?for first-line supervisors?

Suggested addition to your statement of Core Suggested addition to your statement of Core

Values: Values: “We are obsessed with “We are obsessed with developing a cadre of 1st line developing a cadre of 1st line managers that is second to managers that is second to

none—we understand that this none—we understand that this cadre per se is arguably one of cadre per se is arguably one of

our top two or three most our top two or three most important ‘Strategic Assets.’”important ‘Strategic Assets.’”

As I write, I’ve been banging on about this As I write, I’ve been banging on about this for about 18 months. for about 18 months. In all my experience, I In all my experience, I have rarely hit such an exposed nerve—and have rarely hit such an exposed nerve—and have rarely observed such vigorous follow-have rarely observed such vigorous follow-up (interestingly, especially from giant up (interestingly, especially from giant company CEOs).company CEOs).

Upon reflecting, most agree with the basic Upon reflecting, most agree with the basic assertion of the “over-the-top” importanceassertion of the “over-the-top” importanceof the 1of the 1stst line cadre—and, further, that they line cadre—and, further, that they are doing a half-assed job at best with are doing a half-assed job at best with selection and development, and that selection and development, and that they’re downright embarrassed at how they’re downright embarrassed at how inadequate their training is. inadequate their training is.

WOMEN RULEWOMEN RULE!!

““Research Research suggests that suggests that to succeed, to succeed,

start by start by promoting promoting women.”women.”

Source: Nicholas Kristof, “Twitter, Women, and Power,” Source: Nicholas Kristof, “Twitter, Women, and Power,” NYTimesNYTimes, 1024.13, 1024.13

Progress has been made.Progress has been made.But there is a long way to go.But there is a long way to go.

““I speak to you with a feminine voice.I speak to you with a feminine voice. It’s the voice of democracy, of equality. It’s the voice of democracy, of equality.

I am certain, ladies and gentlemen,I am certain, ladies and gentlemen, that that this will be this will be

the woman’s the woman’s centurcentury.y. In the Portuguese language, In the Portuguese language,

words such as life, soul, and hope are of the feminine words such as life, soul, and hope are of the feminine

gender, as are other words like courage and sincerity.”gender, as are other words like courage and sincerity.”

——President Dilma Rousseff of BrazilPresident Dilma Rousseff of Brazil, 1st woman to, 1st woman to keynote the United Nations General Assembly (2011)keynote the United Nations General Assembly (2011)

““AS AS LEADERS, LEADERS, WOMEN WOMEN

RULERULE:: New Studies find that New Studies find that

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

TITLE/ Special Report/ TITLE/ Special Report/ BusinessWeekBusinessWeek

Women’s Strengths Match New Women’s Strengths Match New Economy ImperativesEconomy Imperatives:: Link [rather than Link [rather than

rank] workers; rank] workers; favor interactive-favor interactive-collaborative leadership style collaborative leadership style

[empowerment beats top-down decision [empowerment beats top-down decision making];making]; sustain fruitful collaborations; sustain fruitful collaborations;

comfortable with sharing information; comfortable with sharing information; see see redistribution of powerredistribution of power

as victory, not surrender as victory, not surrender; favor multi-; favor multi-dimensional feedback; dimensional feedback; value technical & value technical & interpersonal skills, individual & group interpersonal skills, individual & group contributions equally;contributions equally; readily accept readily accept

ambiguity; ambiguity; honor intuition as well as pure honor intuition as well as pure “rationality”;“rationality”; inherently flexible; inherently flexible; appreciate appreciate

cultural diversitycultural diversity..

Source: Source: Judy B. Rosener, Judy B. Rosener, America’s Competitive Secret: Women ManagersAmerica’s Competitive Secret: Women Managers

In the “modern” organization, huffing In the “modern” organization, huffing and puffing and shouting orders is and puffing and shouting orders is dying. Gaining cooperation of dying. Gaining cooperation of scattered team members who don’t scattered team members who don’t “report to” the leader is the emergent “report to” the leader is the emergent norm. Which plays to women’s norm. Which plays to women’s strengths.strengths.

Women’s NeWomen’s Neggotiatinotiatingg Stren Strenggthsths

*Ability to put themselves in their *Ability to put themselves in their counterparts’ shoes counterparts’ 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, Source: Horacio Falcao, Cover story/May 2006, World BusinessWorld Business, “Say It , “Say It Like a Woman: Why the 21Like a Woman: Why the 21stst-century negotiator will need the female -century negotiator will need the female touch”touch”

For One (For One (BIGBIG) Thing …) Thing …

““McKinsey & Company found that McKinsey & Company found that the international companies with the international companies with more women on their corporate more women on their corporate

boards boards far outperformedfar outperformed the average the average company in return on equity and company in return on equity and

other measures. Operating profit other measures. Operating profit

was …was … 56%56% higher.”higher.”

Source: Nicholas Kristof, “Twitter, Women, and Power,” Source: Nicholas Kristof, “Twitter, Women, and Power,” NYTimesNYTimes, 1024.13, 1024.13

““Headline 2020:Headline 2020: Women Women

Hold Hold 8080 Percent Percent

of Management and of Management and Professional Jobs”Professional Jobs”

Source: Source: The Extreme Future: The Top Trends That Will The Extreme Future: The Top Trends That Will Reshape the World in the Next 20 YearsReshape the World in the Next 20 Years, James Canton, James Canton

Context for the above.Context for the above.Non-trivial.Non-trivial.

Warren Buffett Warren Buffett Invests Like a Girl: Invests Like a Girl:

And Why YouAnd Why YouShould TooShould Too —Louann Lofton—Louann Lofton

FYI.FYI.

Portrait of a Female InvestorPortrait of a Female Investor

1. Trade less than men do1. Trade less than men do2. Exhibit less overconfidence—more likely to know2. Exhibit less overconfidence—more likely to know what they don’t know what they don’t know3. Shun risk more than male investors do3. Shun risk more than male investors do4. Less optimistic, more realistic than their male4. Less optimistic, more realistic than their male counterparts counterparts5. Put in more time and effort researching possible5. Put in more time and effort researching possible investments—consider details and alternate points investments—consider details and alternate points of view of view6. More immune to peer pressure—tend to make6. More immune to peer pressure—tend to make decisions the same way regardless of who’s watching decisions the same way regardless of who’s watching7. Learn from their mistakes7. Learn from their mistakes8. Have less testosterone than men do, making them8. Have less testosterone than men do, making them less willing to take extreme risks, which, in turn, less willing to take extreme risks, which, in turn, could lead to less extreme market cycles could lead to less extreme market cycles

Source: Source: Warren Buffett Invests Like a Girl: And Warren Buffett Invests Like a Girl: And Why You Should TooWhy You Should Too, Louann Lofton, Chapter 2, “The Science Behind , Louann Lofton, Chapter 2, “The Science Behind the Girl”the Girl”

Sparkling list of attributes.Sparkling list of attributes.(Could we have avoided the Great (Could we have avoided the Great Recession if women had run the Recession if women had run the investment world?)investment world?)

THE MORAL THE MORAL IMPERATIVEIMPERATIVECIRCA 2014CIRCA 2014

THE MORAL THE MORAL IMPERATIVE:IMPERATIVE:

PEOPLE PEOPLE DEVELOPMENTDEVELOPMENT

CORPORATE MANDATE #1 2014:CORPORATE MANDATE #1 2014: Your Your principal moral obligation as a principal moral obligation as a

leader is to develop the skillset, leader is to develop the skillset, “soft” and “hard,” of every one “soft” and “hard,” of every one

of the people in your charge of the people in your charge (temporary as well as semi-(temporary as well as semi-permanent) to the maximum permanent) to the maximum

extent of your abilities. The good extent of your abilities. The good news: news: This is also theThis is also the

#1 mid- to lon#1 mid- to longg-term-term … … p profit maximization straterofit maximization strategy!gy!

To mTo myy wa wayy of thinkin of thinkingg, , this is bthis is byy far the most far the most imimpportant ortant ppoint oint considered in this considered in this ppresentationresentation..

““The notion that corThe notion that corpporate law requires orate law requires directors, executives, and emdirectors, executives, and empploloyyeesees

to maximize shareholder wealth simto maximize shareholder wealth simppllyy isn’t trueisn’t true. There is no solid legal support . There is no solid legal support

for the claim that directors and for the claim that directors and executives in U.S. public corporations executives in U.S. public corporations

have an enforceable legal duty to have an enforceable legal duty to

maximize shareholder wealth.maximize shareholder wealth. The The idea is fableidea is fable..””

—Lynn Stout, professor of corporate and business law, Cornell —Lynn Stout, professor of corporate and business law, Cornell

law school, in … law school, in … The Shareholder Value Myth: The Shareholder Value Myth: How Putting Shareholders First HarmsHow Putting Shareholders First Harms

Investors, Corporations, and the Public Investors, Corporations, and the Public

Though I believe that people Though I believe that people development is the keystone of profit development is the keystone of profit maximization, it will not happen maximization, it will not happen overnight. Short-termism is, alas, often overnight. Short-termism is, alas, often the excuse for not pursuing this path—the excuse for not pursuing this path—it comes in the guise of ‘it fails to it comes in the guise of ‘it fails to maximize shareholder value.” It’s a maximize shareholder value.” It’s a long story, but fact is shareholder long story, but fact is shareholder value maximization is in no way a value maximization is in no way a corporate legal imperative. (The book corporate legal imperative. (The book cited in this slide is a peach.)cited in this slide is a peach.)

In In Good BusinessGood Business, Mihaly Csikszentmihalyi argues , Mihaly Csikszentmihalyi argues persuasively that business has become the center of persuasively that business has become the center of

society. As such, an obligation to community is front & society. As such, an obligation to community is front & center. Business as societal bedrock, has the center. Business as societal bedrock, has the

RESPONSIBILITY to increase theRESPONSIBILITY to increase the ““SUMSUM OF OF HUMANHUMAN WELLWELL--BEINGBEING.”.”

Business is NOT "part of the community."Business is NOT "part of the community." In terms of In terms of how adults collectively spend their waking how adults collectively spend their waking

hours … hours … BUSINESSBUSINESS ISIS THETHE COMMUNITYCOMMUNITY.. And should act accordingly. And should act accordingly.

The (REALLY) good news:The (REALLY) good news: Community mindednessCommunity mindedness is a great way (THE best way?) to have is a great way (THE best way?) to have

spirited/committed/ customer-centric work spirited/committed/ customer-centric work force—and, ultimately, increase (maximize?) force—and, ultimately, increase (maximize?)

profitability!profitability!

I love this!I love this!(And “buy it” 100%.)(And “buy it” 100%.)

Oath of Office:Oath of Office: Managers/Servant Leaders Managers/Servant Leaders

Our goal is to serve our customers brilliantly and profitably overOur goal is to serve our customers brilliantly and profitably over the long haul.the long haul.Serving our customers brilliantly and profitably over the longServing our customers brilliantly and profitably over the long haul is a product of brilliantly serving, over the long haul, thehaul is a product of brilliantly serving, over the long haul, the people who serve the customer.people who serve the customer.

Hence, our job as leaders—the alpha and the omega andHence, our job as leaders—the alpha and the omega and everything in between—is abetting the sustained everything in between—is abetting the sustained growthgrowth and success and engagement and enthusiasm andand success and engagement and enthusiasm and commitment to Excellence of those, one at a time, commitment to Excellence of those, one at a time, whowho directly or indirectly serve the ultimate customer.directly or indirectly serve the ultimate customer.

We—leaders of every stripe—are in the “Human Growth andWe—leaders of every stripe—are in the “Human Growth and Development and Success and Aspiration to ExcellenceDevelopment and Success and Aspiration to Excellence business.”business.”““We” We” (leaders)(leaders) only grow when “they” only grow when “they” (each and every one of our colleagues)(each and every one of our colleagues) are are growing.growing.““We” We” (leaders)(leaders) only succeed when “they” only succeed when “they” (each and every one of our colleagues)(each and every one of our colleagues)

are succeeding.are succeeding.““We” We” (leaders)(leaders) only energetically march toward Excellence when only energetically march toward Excellence when “ “they” they” (each and every one of our colleagues)(each and every one of our colleagues) are energetically marching are energetically marching toward Excellence.toward Excellence.Period.Period.

Please consider.Please consider.

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

actors and actresses canactors and actresses can become more than become more than thetheyy’ve ever been ’ve ever been

before,before, more than themore than they’y’ve ve dreamed of beindreamed of being.”g.”

——Robert Altman, Oscar acceptance speechRobert Altman, Oscar acceptance speech

Perfecto.Perfecto.(And—damn it—as applicable to part-(And—damn it—as applicable to part-timers as movie stars.)timers as movie stars.)

The Memories That MatterThe Memories That Matter

The people you developed who went on toThe people you developed who went on to stellar accomplishments inside or outsidestellar accomplishments inside or outside the company.the company. The (no more than) two or three people you developed who went on The (no more than) two or three people you developed who went on toto create create stellar institutions of their own.stellar institutions of their own.The long shots (people with “a certain something”) you bet on whoThe long shots (people with “a certain something”) you bet on who surprised themselves—surprised themselves—andand your peers. your peers.

The people of all stripes who 2/5/10/20 yearsThe people of all stripes who 2/5/10/20 years later say later say “You made a difference in my “You made a difference in my life,”life,” “ “Your belief in me changed everything.”Your belief in me changed everything.”The sort of/character of people you hired in general. (The sort of/character of people you hired in general. (And And the bad the bad apples you chucked out despite some stellar traits.)apples you chucked out despite some stellar traits.)A handful of projects (a half dozen at most) you doggedly pursued A handful of projects (a half dozen at most) you doggedly pursued thatthat still make you smile and which fundamentally changed the waystill make you smile and which fundamentally changed the way things are done inside or outside the company/industry.things are done inside or outside the company/industry. The supercharged camaraderie of a handful of Great Teams aiming The supercharged camaraderie of a handful of Great Teams aiming toto “ “change the world.”change the world.”

This is the sort of thing you’ll look back This is the sort of thing you’ll look back on at my age—71. Not the $$$ wealth on at my age—71. Not the $$$ wealth you accumulated.you accumulated.

CONTEXTCONTEXT

Context:Context:1,000,0001,000,000

1/721: “The greatest “The greatest shortcoming of the shortcoming of the human race is our human race is our

inability to inability to understand the understand the

exponential exponential function.” function.” —Albert A. Bartlett—Albert A. Bartlett

It is not that dramatic change is in the It is not that dramatic change is in the air, though that’s true. It is that the … air, though that’s true. It is that the …

ACCELERATIONACCELERATION … of the … of the rate of change is unprecedented.rate of change is unprecedented.

China/Foxconn:China/Foxconn:

1,000,001,000,0000 robots/next 3 robots/next 3

yearsyears

Source:Source: Race AGAINST the Machine, Race AGAINST the Machine, Erik Brynjolfsson and Andrew McAfeeErik Brynjolfsson and Andrew McAfee

We typically think of China in terms of We typically think of China in terms of low-cost labor. China’s labor costs are low-cost labor. China’s labor costs are soaring—and, like the rest of us, the soaring—and, like the rest of us, the Chinese are stepping up their game. Chinese are stepping up their game. (In fact this trend is so prominent that (In fact this trend is so prominent that manufacturing employment in China is manufacturing employment in China is falling.)falling.)

““Automation has become so Automation has become so sophisticated that on a typical sophisticated that on a typical passenger flight, a human pilot passenger flight, a human pilot

holds the controls for a grand total holds the controls for a grand total

of …of …33 minutesminutes. .

[Pilots] have become, it’s not much [Pilots] have become, it’s not much of an exaggeration to say, computer of an exaggeration to say, computer

operators.”operators.” Source: Nicholas Carr, “The Great Forgetting,” Source: Nicholas Carr, “The Great Forgetting,” The AtlanticThe Atlantic, 11.13, 11.13

““Meet Your Meet Your Next Surgeon: Next Surgeon:

Dr. Robot”Dr. Robot”Source: Feature/Source: Feature/FortuneFortune/15 JAN 2013/on Intuitive Surgical’s/15 JAN 2013/on Intuitive Surgical’s

da Vincida Vinci /multiple bypass heart-surgery /multiple bypass heart-surgery

robotrobot

““[Michael Vassar/[Michael Vassar/MetaMedMetaMed founder] is creating a better information system and founder] is creating a better information system and

new class of people to manage it. new class of people to manage it. ‘Almost all ‘Almost all health care people get is health care people get is

going to be done—going to be done—hopefully—by algorithms hopefully—by algorithms

within a decade or two.within a decade or two. We used We used

to rely on doctors to be experts, and we’ve crowded them into being something like to rely on doctors to be experts, and we’ve crowded them into being something like factory workers, where their job is to see one patient every 8 to 11 minutes and factory workers, where their job is to see one patient every 8 to 11 minutes and

implement a by-the-book solution. implement a by-the-book solution. I’m talking about creating a new I’m talking about creating a new ‘expert profession’—medical quants, almost like hedgefund ‘expert profession’—medical quants, almost like hedgefund managers, who could do the high-level analytical work of managers, who could do the high-level analytical work of

directing all the information that flows into the world’s hard directing all the information that flows into the world’s hard drives.drives. Doctors would now be aided by Vassar’s new information experts who Doctors would now be aided by Vassar’s new information experts who

would be aided by advanced artificial intelligence.”would be aided by advanced artificial intelligence.”——New YorkNew York /0624.13 /0624.13

PersadoPersado (vs. copywriter): emotion words, product (vs. copywriter): emotion words, product characteristics, “call to action,” position of text, characteristics, “call to action,” position of text,

imagesimages

Up To $250 To Spend On Up To $250 To Spend On All Ships In AllAll Ships In All

Destinations. 2 Days LeftDestinations. 2 Days Left

(1.3%)(1.3%)vs.vs.

No kidding! You Qualify toNo kidding! You Qualify toExperience An IncredibleExperience An Incredible

Vacation With Us :-)Vacation With Us :-)

(4.1) (4.1)

“A creative person is good but random. We’ve taken “A creative person is good but random. We’ve taken the randomness out by building an ontology of the randomness out by building an ontology of

language”language”——Lawrence Whittle, head of salesLawrence Whittle, head of sales

Source: Wall Street Journal/ Source: Wall Street Journal/ 0825.14/ “It’s Finally Time to Take AI Seriously”0825.14/ “It’s Finally Time to Take AI Seriously”

Algorithmically derived/producedAlgorithmically derived/producedad copy more effective than that of a ad copy more effective than that of a human copywriter.human copywriter.

““Flash forward to dystopia. You work in a chic Flash forward to dystopia. You work in a chic cubicle, sucking chicken-flavor sustenance fromcubicle, sucking chicken-flavor sustenance from

a tube. You’re furiously maneuvering with a a tube. You’re furiously maneuvering with a joystick … Your boss stops by and gives you a joystick … Your boss stops by and gives you a

look. look. ‘We need to talk about your loyalty to this ‘We need to talk about your loyalty to this

company.’company.’ The organization you work for has deduced that you

are considering quitting. It predicts your plans and

intentions, possibly before you have even conceived them.” —Eric —Eric

Siegel,Siegel, Predictive Analytics: Predictive Analytics: The Power to Predict Who Will Click, Buy, Lie, or Die The Power to Predict Who Will Click, Buy, Lie, or Die (based on a real case, an (based on a real case, an

HP “Flight risk” PA model developed by HR, with astronomical savings potential)HP “Flight risk” PA model developed by HR, with astronomical savings potential)

AI comes to HR in the Age of “Big AI comes to HR in the Age of “Big Data.” Katy bar the door.Data.” Katy bar the door.

Robot Wars!Robot Wars!

“The combination of new “The combination of new market rules and new market rules and new

technology was turningtechnology was turning the stock market into, in the stock market into, in

effect,effect, aa warwar of of robotsrobots.”.” —Michael Lewis, “Goldman’s —Michael Lewis, “Goldman’s

Geek Tragedy,” Geek Tragedy,” Vanity FairVanity Fair, 09.13, 09.13

Let’s Welcome Our Newest Board Member: “Just like “Just like

other members of the other members of the board, board, the algorithm the algorithm ggets to ets to

vote on whether the firm vote on whether the firm makes an investment in a makes an investment in a ssppecific comecific comppananyy or not or not. . The program will be the The program will be the sixth member of DKV's sixth member of DKV's

board.” board.” —B usiness Insider, —B usiness Insider, 13 May 2014:13 May 2014:

““A Hong Kong VC fund has just appointed an algorithm to its board.” A Hong Kong VC fund has just appointed an algorithm to its board.”

““A Hong Kong VC fund has just appointed an A Hong Kong VC fund has just appointed an algorithm to its board.algorithm to its board. Deep Knowledge Ventures, a firm that Deep Knowledge Ventures, a firm that focuses on age-related disease drugs and regenerative medicine projects, says focuses on age-related disease drugs and regenerative medicine projects, says the program, called VITAL, can make investment recommendations about life the program, called VITAL, can make investment recommendations about life sciences firms by poring over large amounts of data.sciences firms by poring over large amounts of data.

““Just like other members of the board, the Just like other members of the board, the algorithm gets to vote on whether the firm algorithm gets to vote on whether the firm makes an investment in a specific company or makes an investment in a specific company or not. The program will be the sixth member of not. The program will be the sixth member of DKV's board.DKV's board.““VITAL's software was developed by UK-based Aging Analytics. VITAL's software was developed by UK-based Aging Analytics. ‘‘[The goal] is actually to draw attention developing it as an independent [The goal] is actually to draw attention developing it as an independent decision maker,’ Deep Knowledge Venture's Charles Groome told BI. decision maker,’ Deep Knowledge Venture's Charles Groome told BI.

““How does the algorithm work? VITAL makes its decisions by scanning How does the algorithm work? VITAL makes its decisions by scanning prospective companies' financing, clinical trials, intellectual property and prospective companies' financing, clinical trials, intellectual property and previous funding rounds. Groome says it has already helped approved two previous funding rounds. Groome says it has already helped approved two investment decisions (though has not yet cast its first vote), both of which investment decisions (though has not yet cast its first vote), both of which resemble its own function: In Silico Medicine, which develops computer-assisted resemble its own function: In Silico Medicine, which develops computer-assisted methods for drug discovery in aging research; and In Silico's partner firm methods for drug discovery in aging research; and In Silico's partner firm Pathway Pharmaceuticals, which employs a platform called OncoFinder to select Pathway Pharmaceuticals, which employs a platform called OncoFinder to select

and rate personalized cancer therapies.” —and rate personalized cancer therapies.” —Business Insider, Business Insider, 13 May 201413 May 2014

““Algorithms have already written symphonies Algorithms have already written symphonies as moving as those composed by as moving as those composed by

Beethoven, picked through legalese , picked through legalese

with the deftness of a senior with the deftness of a senior law partner, diagnosed patients with more , diagnosed patients with more

accuracy than a accuracy than a doctor, written news , written news

articles with the smooth hand of a seasonedarticles with the smooth hand of a seasoned reporter, and driven vehicles on urban , and driven vehicles on urban

highways with far better control than a human highways with far better control than a human

driver.”.”

——Christopher Steiner,Christopher Steiner, Automate This: How Algorithms Came to Rule the World

“ … “ … Which haiku are human Which haiku are human writing and which are from a writing and which are from a group of bits?group of bits? Sampling centuries of Sampling centuries of

haiku, devising rules, spotting patterns, and haiku, devising rules, spotting patterns, and inventing ways to inject originality, Annie inventing ways to inject originality, Annie

[algorithm] took to the short Japanese sets of [algorithm] took to the short Japanese sets of prose the same way all of [Prof David] Cope’s. prose the same way all of [Prof David] Cope’s. algorithms tackled classical music. ‘In the end, algorithms tackled classical music. ‘In the end,

it’s just layers and layers of binary math, he it’s just layers and layers of binary math, he says. … Cope says says. … Cope says Annie’sAnnie’s penchantpenchant forfor tastefultasteful

oriorigginalitinality could push her past most human y could push her past most human composers who simply build on work of the composers who simply build on work of the

past, which, in turn, was built on older works. past, which, in turn, was built on older works. …” …” —Christopher Steiner, —Christopher Steiner, Automate This: How Algorithms Automate This: How Algorithms

Came to Rule the WorldCame to Rule the World

““Human level Human level capability has not capability has not turned out to be a turned out to be a special stopping special stopping

point from an point from an engineering engineering

perspective. ….”perspective. ….”

Source: Illah Reza Nourbakhsh, Professor of Robotics, Carnegie Mellon, Source: Illah Reza Nourbakhsh, Professor of Robotics, Carnegie Mellon, Robot Robot FuturesFutures

Automate This: Automate This: How How

Algorithms Algorithms Came to Rule Came to Rule

the Worldthe World

——Christopher SteinerChristopher Steiner

“A bureaucrat is an expensive microchip.”

——Dan Sullivan, consultant and executive coachDan Sullivan, consultant and executive coach

Robotics and Artificial Intelligence are Robotics and Artificial Intelligence are taking on high-end white-collar (and taking on high-end white-collar (and “white coat”) jobs.“white coat”) jobs.

And we’re only warming up …And we’re only warming up …

““I believe that ninety I believe that ninety percent of white-percent of white-

collar/“knowledge-work” collar/“knowledge-work” jobs (which are 80 percent jobs (which are 80 percent

of all jobs) in the U.S. will be of all jobs) in the U.S. will be either destroyed or altered either destroyed or altered beyond recognition in the beyond recognition in the

next 10 to 15 years.”next 10 to 15 years.”——Cover story/Cover story/TimeTime/22 May 2000/Tom Peters/22 May 2000/Tom Peters

(I was a little premature with my Y2K (I was a little premature with my Y2K prognostication. But, perhaps, not by prognostication. But, perhaps, not by much.)much.)

IoT/The Internet of ThingsIoT/The Internet of Things IoE/The Internet of IoE/The Internet of EverythingEverything M2M/Machine-to-MachineM2M/Machine-to-Machine Ubiquitous computingUbiquitous computing Embedded computingEmbedded computing Pervasive computingPervasive computing Industrial InternetIndustrial Internet Etc.*Etc.* **** ******

*“*“More Than More Than 50 BILLION50 BILLION connected devices by 2020” —Ericsson connected devices by 2020” —Ericsson

**Estimated **Estimated 212 BILLION212 BILLION connected devices by 2020—IDC connected devices by 2020—IDC

***“By 2025 IoT could be applicable to ***“By 2025 IoT could be applicable to $82 TRILLION$82 TRILLION of output or of output or approximately one half the global economy”—GE (The WAGs to end all WAGs!)approximately one half the global economy”—GE (The WAGs to end all WAGs!)

Internet of EverythingInternet of Everything

““The idea of the IoE* The idea of the IoE* [Internet of [Internet of

Everything/Cisco Systems]Everything/Cisco Systems] is a networked is a networked connection of people, connection of people,

processes, data and ‘things,’ processes, data and ‘things,’ which is being facilitated by which is being facilitated by

technology transitions such as technology transitions such as increased mobility, cloud increased mobility, cloud

computing and the importance computing and the importance of big data.”of big data.”

*Estimated market size, next decade: *Estimated market size, next decade: $14.4 $14.4 trilliontrillionSource: “The Big Switch,”Source: “The Big Switch,” Capital Insights Capital Insights

““Ford is working with the Ford is working with the healthcare industry on a healthcare industry on a

solution that would notify a solution that would notify a nearby hospital if you were nearby hospital if you were

having a heart attack in your having a heart attack in your car, which can send an car, which can send an

ambulance … ambulance … before you even know you’re having

one. …”

——Daniel Kellmereit & Daniel Obodovski,Daniel Kellmereit & Daniel Obodovski, The Silent Intelligence: The Internet of Things The Silent Intelligence: The Internet of Things

Everything connected to every thing—Everything connected to every thing—with system self-management as one with system self-management as one result.result.

““The root of our problem is notThe root of our problem is not that we’re in a Great Recessionthat we’re in a Great Recession

or a Great Stagnation, but ratheror a Great Stagnation, but rather that we are in the early that we are in the early

throes of a throes of a Great Restructuring. .

Our technologies are racing ahead,Our technologies are racing ahead, but our skills and organizationsbut our skills and organizations

are lagging behind.”are lagging behind.”

Source:Source: Race AGAINST the Machine, Race AGAINST the Machine, Erik Brynjolfsson and Andrew McAfeeErik Brynjolfsson and Andrew McAfee

“The median worker is losing the race against the machine.”

——Erik Brynjolfsson and Andrew McAfee, Erik Brynjolfsson and Andrew McAfee, Race Against the MachineRace Against the Machine

(1) Interviewee re TurboTax: “No way. I don’t use an H&R (1) Interviewee re TurboTax: “No way. I don’t use an H&R Block tax preparer any more. I’ve switched to TurboTax Block tax preparer any more. I’ve switched to TurboTax software. It’s only $49 and much quicker and more software. It’s only $49 and much quicker and more accurate.” Brynjolfsson/McAfee: accurate.” Brynjolfsson/McAfee: “The creators of TurboTax “The creators of TurboTax are better off—but tens of thousands of tax preparers now are better off—but tens of thousands of tax preparers now find their jobs and incomes threatened.”find their jobs and incomes threatened.”

(2) CEO interviewed by the authors says he installed new (2) CEO interviewed by the authors says he installed new infotech equipment before the Great Recession, but did not infotech equipment before the Great Recession, but did not cut payroll when profits were soaring. And then: cut payroll when profits were soaring. And then: “When “When the recession came, business as usual was obviously not the recession came, business as usual was obviously not sustainable, which made it easier to implement a round of sustainable, which made it easier to implement a round of painful streamlining and layoffs. As the recession ended painful streamlining and layoffs. As the recession ended and profits and demand returned, the jobs doing routine and profits and demand returned, the jobs doing routine work were not restored.”work were not restored.”

(3) “For most of the 19(3) “For most of the 19thth and 20th centuries, employment and 20th centuries, employment usually rebounded after each recession, but since the usually rebounded after each recession, but since the 1990s employment didn’t recover briskly after recessions. 1990s employment didn’t recover briskly after recessions. It’s not coincidence that as the computerization of the It’s not coincidence that as the computerization of the economy advanced, post-recession hiring patterns economy advanced, post-recession hiring patterns changed.”changed.”

Source: Source: The Second Machine AgeThe Second Machine Age, by Eric Brynjolfsson and Andrew McAfee, by Eric Brynjolfsson and Andrew McAfee

CORPORATE MANDATE #1 2014:CORPORATE MANDATE #1 2014: Your Your principal moral obligation as a principal moral obligation as a

leader is to develop the skillset, leader is to develop the skillset, “soft” and “hard,” of every one “soft” and “hard,” of every one

of the people in your charge of the people in your charge (temporary as well as semi-(temporary as well as semi-permanent) to the maximum permanent) to the maximum

extent of your abilities. The good extent of your abilities. The good news: news: This is also theThis is also the

#1 mid- to lon#1 mid- to longg-term-term … … p profit maximization straterofit maximization strategy!gy!

I repeat this slide, because the I repeat this slide, because the extraordinary context sketched here is extraordinary context sketched here is the reason we must turn our attention the reason we must turn our attention posthaste—and with major resource posthaste—and with major resource allocation—to the development of our allocation—to the development of our teammates as they attempt to run the teammates as they attempt to run the race against the machine.race against the machine.

INNOVATION:INNOVATION:FIVE TACTICSFIVE TACTICS

11/48/48

No kidding, this truly is … No kidding, this truly is … the the only thing I’ve only thing I’ve learned “for sure”learned “for sure” … in … in the 48 years since I began my the 48 years since I began my managerial career—as a U.S. Navy managerial career—as a U.S. Navy construction battalion ensign in construction battalion ensign in Vietnam.Vietnam.

Lesson48:Lesson48: WTTMSWTTMS

WW

WHOEVERWHOEVERTRIESTRIESTHETHEMOSTMOSTSTUFFSTUFFWINSWINS

Excellence82: The Bedrock “EiExcellence82: The Bedrock “Eigght Basics”ht Basics”

1. 1. A Bias for A Bias for ActionAction2. Close to the 2. Close to the CustomerCustomer3. 3. AutonomAutonomy and y 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 PropertiesProperties

If I were to update the book in 2014, If I were to update the book in 2014,

there is there is ZEROZERO doubt that “a doubt that “a

bias for action” would top the list—bias for action” would top the list—with even more emphasis than 32 with even more emphasis than 32 years ago.years ago.

““WE HAVE A WE HAVE A ‘STRATEGIC ‘STRATEGIC PLAN.’ IT’S PLAN.’ IT’S

CALLED CALLED DOING DOING THINGSTHINGS.”.” — Herb Kelleher

READY.READY.FIRE!FIRE!AIM.AIM.

H. Ross Perot (vs H. Ross Perot (vs ““Aim! Aim! Aim!”Aim! Aim! Aim!” /EDS vs GM/1985)/EDS vs GM/1985)

Screw it.Screw it.Just do it.Just do it.

——book title, Richard Bransonbook title, Richard Branson

““EXPERIMENT EXPERIMENT FEARLESSLY”FEARLESSLY”

Source: BusinessWeek, “Type A Organization Strategies: How to Hit a Moving Target”—Tactic #1Tactic #1

“RELENTLESS TRIAL“RELENTLESS TRIAL AND ERROR” AND ERROR”

Source: Source: Wall Street JournalWall Street Journal, cornerstone of effective approach to “rebalancing” company, cornerstone of effective approach to “rebalancing” company portfolios in the face of changing and uncertain global economic conditions (11.08.10) portfolios in the face of changing and uncertain global economic conditions (11.08.10)

Key words:Key words:

FearlesslyFearlesslyRelentlessRelentless

““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, We fixed them by doing it over and over, again and again.again and again. We do the same today. While our We do the same today. While our competitors are still sucking their thumbs trying to competitors are still sucking their thumbs trying to

make the design perfect, we’re already on prototype make the design perfect, we’re already on prototype

versionversion ##55.. By the time our rivals are ready By the time our rivals are ready

with wires and screws, we are on version 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 BloombergBloomberg by Bloomberg

““DEMODEMO OR DIE!”OR DIE!”

Source: This was the approach championed by Source: This was the approach championed by NicholasNicholas NeNeggroropponteonte which vaulted his which vaulted his MITMIT MediaMedia LabLab to the forefront of IT-multimedia to the forefront of IT-multimedia

innovation. It was his successful alternative to the traditional innovation. It was his successful alternative to the traditional MIT-academic MIT-academic “publish or perish.”“publish or perish.” Negroponte’s rapid-prototyping Negroponte’s rapid-prototyping

version was emblematic of the times and the pace and the enormityversion was emblematic of the times and the pace and the enormity of the opportunity. (of the opportunity. (NYTimesNYTimes/0426.11)/0426.11)

Culture of PrototypingCulture of Prototyping

“Effective prototyping may “Effective prototyping may

be be THETHE MOST MOST VALUABLEVALUABLE CORE CORE COMPETENCECOMPETENCE an an

innovative organization can innovative organization can hope to have.”hope to have.” —Michael Schrage—Michael Schrage

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

understand thatunderstand that YOU ONLY YOU ONLY FIND OIL IF YOU FIND OIL IF YOU DRILL WELLSDRILL WELLS.. You You

may think you’re finding it when you’re may think you’re finding it when you’re drawing maps and studying logs, but you drawing maps and studying logs, but you

have to drill.”have to drill.” —The Hunters—The Hunters, by John Masters, , by John Masters, wildly successful Canadian Oil & Gas wildcatterwildly successful Canadian Oil & Gas wildcatter

““FAIL.FAIL. FORWARD. FORWARD.

FAST.”FAST.”High Tech CEO, Pennsylvania

““Fail faster. Fail faster. Succeed Succeed Sooner.”Sooner.”

David Kelley/IDEO

““No matter. No matter. Try again. Fail Try again. Fail

again. Fail again. Fail better.”better.”

—Samuel Beckett—Samuel Beckett

““REWARDREWARD excellent failures. PUNISHPUNISH mediocre

successes.”—Phil Daniels, Sydney exec

““In business, you In business, you rewardreward people for taking people for taking risksrisks..

When it When it doesn’tdoesn’t workwork outout you you ppromoteromote them them——because because they were willing to try new they were willing to try new

things. If people tell me things. If people tell me they skied all day and never they skied all day and never fell down, I tell them to tryfell down, I tell them to try

a different mountain.” a different mountain.” —Michael Bloomberg (—Michael Bloomberg (BWBW/0625.07)/0625.07)

Ideas Economy: Ideas Economy: CAN YOUR CAN YOUR

BUSINESS FAIL BUSINESS FAIL FAST ENOUGH TO FAST ENOUGH TO

SUCCEED?SUCCEED?Source: ad for Economist Conference/0328.13/Berkeley CA (caps are Source: ad for Economist Conference/0328.13/Berkeley CA (caps are EconomistEconomist))

““The secret of fast The secret of fast progress is progress is

inefficiency, fast , fast and furious and and furious and

numerous failures.”numerous failures.”—Kevin Kelly

““The essenceThe essence of capitalism is of capitalism is

encouraging failure, encouraging failure, not rewarding not rewarding

success.”success.” —Nassim Nicholas Taleb/Reason TV/0124.13—Nassim Nicholas Taleb/Reason TV/0124.13

If you wish, I can muster another 20 If you wish, I can muster another 20 “dittohead” slides on this topic.“dittohead” slides on this topic.

““It is not enough to It is not enough to ‘tolerate’ failure—‘tolerate’ failure—

you must you must

‘celebrate’‘celebrate’ failure.”failure.” —Richard Farson (—Richard Farson (Whoever Makes the Whoever Makes the

Most Mistakes WinsMost Mistakes Wins))

Think about this.Think about this.P-L-E-A-S-E.P-L-E-A-S-E.

C-E-L-E-B-R-A-T-C-E-L-E-B-R-A-T-E.E.

““YOU MISS YOU MISS

100100%% OF OF

THE SHOTS YOU THE SHOTS YOU NEVER TAKE.”NEVER TAKE.”

—Wayne—Wayne GretzkyGretzky

All you need to know in life?All you need to know in life?

““All life is an All life is an experiment. The experiment. The

more experiments more experiments you make, the you make, the

better.”better.” —Ralph Waldo Emerson—Ralph Waldo Emerson

Act fast.Act fast.Fail fast.Fail fast.

Correct fast.Correct fast.Make bigger and more Make bigger and more interesting mistakes.interesting mistakes.

All of life is an All of life is an experiment.experiment.

““What are [pioneer aircraft developer Bert] What are [pioneer aircraft developer Bert] Rutan’s management rules? He insists he Rutan’s management rules? He insists he

doesn’t have any. ‘I don’t like rules,’ he says. doesn’t have any. ‘I don’t like rules,’ he says. ‘Things are so easy to change if you don’t ‘Things are so easy to change if you don’t

write them down.’ Rutan feels good write them down.’ Rutan feels good management works in much the same way management works in much the same way

good aircraft design does:good aircraft design does: Instead of Instead of trtryyiningg to fi to figgure out the best ure out the best

way to do somethinway to do somethingg and and stickinstickingg to it, to it, jjust trust tryy out an out an

aapppproach and keeroach and keepp fixin fixingg it it.”.”

——Eric Abrahamson & David Freedman, Chapter 8, “Messy Eric Abrahamson & David Freedman, Chapter 8, “Messy Leadership,”Leadership,” fromfrom A Perfect Mess: The Hidden Benefits of Disorder A Perfect Mess: The Hidden Benefits of Disorder

WTTMSWTTMSASTMSUTFASTMSUTFWW

WTTMSWTTMSASTMSUTFASTMSUTFWW

WHOEVERWHOEVERTRIESTRIESTHETHEMOSTMOSTSTUFFSTUFFANDANDSCREWS SCREWS THE THE MOST MOST STUFF STUFF UPUP THETHEFASTESTFASTESTWINSWINS

We Are We Are WhatWhat

We Eat We Eat

We Are WhatWe Are What We Eat We Eat

We Are Who We We Are Who We Hang Out WithHang Out With

The point here, perhaps, is that I rank The point here, perhaps, is that I rank this next to “bias for action” as one of this next to “bias for action” as one of my Top Two innovation strategies.my Top Two innovation strategies.

Diversity:Diversity: “It is hardly possible to “It is hardly possible to overrate the value of placing overrate the value of placing human beings in contact with human beings in contact with persons dis-similar to themselves, persons dis-similar to themselves, and with modes of thought and and with modes of thought and action unlike those with which action unlike those with which they are familiar. Such they are familiar. Such communication has always been, communication has always been, and is peculiarly in the present and is peculiarly in the present age, one of the primary sources of age, one of the primary sources of progress.”progress.” —John Stuart Mill—John Stuart Mill

““You will become You will become like the five people like the five people you associate with you associate with the most—this can the most—this can

be either a blessing be either a blessing or a curse.”or a curse.” —Billy Cox—Billy Cox

The “Hang Out Axiom”:The “Hang Out Axiom”: “HANG “HANG OUT WITH ‘COOL’ AND OUT WITH ‘COOL’ AND THOU SHALT BECOME THOU SHALT BECOME MORE COOL. HANG MORE COOL. HANG

OUT WITH ‘DULL’ AND OUT WITH ‘DULL’ AND THOU SHALT BECOME THOU SHALT BECOME MORE DULL. MORE DULL. PERIODPERIOD.”.”

It really is about this simple.It really is about this simple.

The “We are what we eat”/ The “We are what we eat”/ “We are who we hang out with”“We are who we hang out with”

Axiom: Axiom: At its core, At its core, evereveryy (!!!) (!!!) relationship-partnership decision relationship-partnership decision

(employee, vendor, customer, etc., (employee, vendor, customer, etc., etc.) is a etc.) is a stratestrateggicic decision about: decision about:

“Innovate,“Innovate, ‘ ‘YesYes’ ’ oror ‘No’ ” ”

Key word:Key word:

EVERYEVERY

Measure/Manage: Portfolio Measure/Manage: Portfolio “Strangeness”/“Quality”“Strangeness”/“Quality”

1. Customers1. Customers2. Vendors2. Vendors3. Out-sourcing Partners3. Out-sourcing Partners4. Acquisitions4. Acquisitions5. Purposeful “Theft”5. Purposeful “Theft”6. Diversity/“d”iversity6. Diversity/“d”iversity7. Diversity/Crowd-sourcing7. Diversity/Crowd-sourcing8.8. Diversity/Weird Diversity/Weird 9.9. Diversity/CuriosityDiversity/Curiosity10. Benchmarks10. Benchmarks11. Calendar11. Calendar12. MBWA12. MBWA13. Lunch/General13. Lunch/General14. Lunch/Other functions14. Lunch/Other functions15. Location/Internal15. Location/Internal16. Location/HQ16. Location/HQ17. Top team17. Top team18. Board18. Board

““The Billion-man The Billion-man Research Team: Research Team:

Companies offering Companies offering work to online work to online

communities are communities are reaping the benefits of reaping the benefits of

crowdsourcing.”crowdsourcing.” —Headline, —Headline, FTFT

““Crowdsourcing” can more or less Crowdsourcing” can more or less apply to … apply to … EVERYTHINGEVERYTHING..

““Who’s the most Who’s the most interesting person interesting person you’ve met in the you’ve met in the last 90 days? How last 90 days? How do I get in touch do I get in touch

with them?”with them?” —Fred Smith—Fred Smith

Maybe not such an easy question to Maybe not such an easy question to answer?answer?Take it seriously.Take it seriously.VERY seriously.VERY seriously.((PLEASEPLEASE.).)

Ouch!Ouch!

“The Bottleneck …The Bottleneck …

“The Bottleneck is at the …The Bottleneck is at the … “Where are you likely to find people “Where are you likely to find people

with the with the least diversitleast diversityy of ex of expperienceerience, , the the larlarggest investment in the est investment in the ppastast,,

and the g and the greatest reverence for reatest reverence for industrindustryy do doggmama … …

Top of the Top of the Bottle”Bottle”

— Gary Hamel/— Gary Hamel/Harvard Business ReviewHarvard Business Review

Alas.Alas.So true.So true.

WE WE AREARE THE THE COMPANYCOMPANY WE KEEP!WE KEEP!

MANAGEMANAGE IT! IT!

This is not intended to be “a good This is not intended to be “a good idea.” It is a strategic asset—and idea.” It is a strategic asset—and should be consciously measured and should be consciously measured and managed.managed.

Diversity:Diversity: Hang out with cool and thou Hang out with cool and thou shalt become more cool. Hang out with shalt become more cool. Hang out with dull and thou shalt become more dull.dull and thou shalt become more dull.

Diversity:Diversity: Your “hang out with” Your “hang out with” “portfolio” can/should be as carefully “portfolio” can/should be as carefully concocted/ managed/ measured as your concocted/ managed/ measured as your strategic plan—it strategic plan—it ISIS your de facto your de facto strategic plan!strategic plan!

Diversity:Diversity: Every relationship-partnership Every relationship-partnership decision (employee/ decision (employee/ vendor/customer/etc.) is a strategic vendor/customer/etc.) is a strategic decision: “Innovate, ‘Yes’ or ‘No.’” decision: “Innovate, ‘Yes’ or ‘No.’”

XFX =XFX =

#1#1

XFX = XFX = #1#1**

*Cross-Functional *Cross-Functional eXcellence eXcellence

A project is behind schedule by three A project is behind schedule by three months? Six months? There is a mess months? Six months? There is a mess amidst the supply chain? Customer orders amidst the supply chain? Customer orders are badly backlogged? Etc. Invariably there are badly backlogged? Etc. Invariably there

is is ONE ONE reason above all others reason above all others

when such snafus occur. when such snafus occur. (As they routinely do.)(As they routinely do.) Namely: Namely:

BOTCHED BOTCHED CROSS-FUNCTIONAL CROSS-FUNCTIONAL CO-ORDINATION.CO-ORDINATION.

NEVER NEVER WASTE A WASTE A LUNCH!LUNCH!

% XF % XF

lunches*lunches***MeasureMeasure!! Monthly! Part of Monthly! Part of

evaluation! evaluation!

% of lunches with people in … % of lunches with people in … OTHER OTHER FUNCTIONSFUNCTIONS..

((BIGBIG deal.) deal.)

XFX:XFX: SOCIALSOCIAL ACCELERATORS …ACCELERATORS …

The key “XFX” attainment tools are social—The key “XFX” attainment tools are social—not technological.not technological.

XFX/Typical XFX/Typical SocialSocial Accelerators Accelerators

1. EVERYONE’s (more or less) JOB #1: Make friends in other 1. EVERYONE’s (more or less) JOB #1: Make friends in other functions! (Purposefully. Consistently. Measurably.)functions! (Purposefully. Consistently. Measurably.)2. “Do lunch” with people in other functions!! Frequently!! 2. “Do lunch” with people in other functions!! Frequently!! (Minimum 10% to 25% for everyone? Measured.)(Minimum 10% to 25% for everyone? Measured.)3. Ask peers in other functions for references so you can become 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-conversant in their world. (It’s one helluva sign of ... GIVE-A-DAMN-ism.) ism.) 4. Religiously invite counterparts in other functions to your team 4. Religiously invite counterparts in other functions to your team meetings. Ask them to present “cool stuff” from “their world” to meetings. Ask them to present “cool stuff” from “their world” to your group. (Useful. Mark of respect.)your group. (Useful. Mark of respect.)

5. 5. PROACTIVELY SEEK EXAMPLES OF “TINY” PROACTIVELY SEEK EXAMPLES OF “TINY” ACTS OF “XFX” TO ACKNOWLEDGE—ACTS OF “XFX” TO ACKNOWLEDGE—PRIVATELY AND PUBLICALLY. (Bosses: ONCE PRIVATELY AND PUBLICALLY. (Bosses: ONCE A DAY … make a short call or visit or send an A DAY … make a short call or visit or send an email of “Thanks” for some sort of XFX email of “Thanks” for some sort of XFX gesture by your folks and some other gesture by your folks and some other function’s folks.)function’s folks.) 6. Present counterparts in other functions awards for service to 6. Present counterparts in other functions awards for service to your group. Tiny awards at least weekly; and an “Annualyour group. Tiny awards at least weekly; and an “Annual All-Star All-Star Supporters (from other groups) Banquet” modeled after superstar Supporters (from other groups) Banquet” modeled after superstar salesperson banquets. salesperson banquets.

XFX/ Typical XFX/ Typical SocialSocial Accelerators Accelerators

7. Routinely discuss—A SEPARATE AGENDA ITEM—good and 7. Routinely discuss—A SEPARATE AGENDA ITEM—good and problematic acts of cross-functional cooperation at every problematic acts of cross-functional cooperation at every Team Meeting. Team Meeting. 8. When someone in another function asks for assistance, 8. When someone in another function asks for assistance, respond with … more … alacrity than you would if it were the respond with … more … alacrity than you would if it were the person in the cubicle next to yours—or even more than you person in the cubicle next to yours—or even more than you would for a key external customer. (Remember, XFX is the would for a key external customer. (Remember, XFX is the key to Customer Retention which is in turn the key to “all key to Customer Retention which is in turn the key to “all good things.”)good things.”)9. Do not bad mouth ... “the damned accountants,” “the 9. Do not bad mouth ... “the damned accountants,” “the bloody HR guy.” Ever. (Bosses: Severe penalties for this—bloody HR guy.” Ever. (Bosses: Severe penalties for this—including public tongue-lashings.) including public tongue-lashings.) 10. 10. Get physical! “Co-location” may well be the most Get physical! “Co-location” may well be the most powerful “culture change lever.”powerful “culture change lever.” Physical X-functional Physical X-functional proximity is almost a … guarantee … of remarkably improved proximity is almost a … guarantee … of remarkably improved cooperation—to aid this one needs flexible workspaces that cooperation—to aid this one needs flexible workspaces that can be mobilized for a team in a flash.can be mobilized for a team in a flash.11. 11. Establish “adhocracy” as S.O.P.Establish “adhocracy” as S.O.P. To improve the new “X- To improve the new “X-functional Culture” (and business results), little XF teams functional Culture” (and business results), little XF teams should be formed on the spot to deal with an urgent issue—should be formed on the spot to deal with an urgent issue—they may live for but ten days, but it helps the XF habit, they may live for but ten days, but it helps the XF habit, making it normal to be “working the XF way.”making it normal to be “working the XF way.”

XFX/ Typical XFX/ Typical SocialSocial Accelerators Accelerators

12. Early project “management” experience. Within days, 12. Early project “management” experience. Within days, literally, of coming aboard folks should be “running” some bit literally, of coming aboard folks should be “running” some bit of a bit of a bit a project, working with folks from other of a bit of a bit a project, working with folks from other functions—hence, “all this” becomes as natural as breathing.functions—hence, “all this” becomes as natural as breathing.13. Work proactively to give as large as possible numbers of 13. Work proactively to give as large as possible numbers of people temporary assignments in other functions—especially people temporary assignments in other functions—especially Finance.Finance.14. “Get ’em out with the customer.” Rarely does the 14. “Get ’em out with the customer.” Rarely does the accountant or bench scientist call on the customer. Reverse accountant or bench scientist call on the customer. Reverse that. Give everyone more or less regular “customer-facing that. Give everyone more or less regular “customer-facing experiences.” She or he learns quickly that the customer is not experiences.” She or he learns quickly that the customer is not interested in our in-house turf battles! interested in our in-house turf battles! 15. Consider creating a special role, or even position. Specialty 15. Consider creating a special role, or even position. Specialty chemical company Buckman Labs established chemical company Buckman Labs established “knowledge “knowledge transfer facilitatorstransfer facilitators,,”” effectively former “middle managers,” effectively former “middle managers,” with 100% of discretionary pay based on success at spurring with 100% of discretionary pay based on success at spurring integration across previously impermeable barriers.integration across previously impermeable barriers.

XFX/: Typical XFX/: Typical SocialSocial Accelerators Accelerators

16. Formal evaluations. Everyone, starting with the receptionist, 16. Formal evaluations. Everyone, starting with the receptionist, should have a significant XF rating component in their evaluation. should have a significant XF rating component in their evaluation. (The “XFX Performance” should be among the Top 3 items in all (The “XFX Performance” should be among the Top 3 items in all managers’ evaluations.)managers’ evaluations.)

17. 17. Every functional unit should have strict and Every functional unit should have strict and extensive measures of “customer satisfaction” extensive measures of “customer satisfaction” based on evaluations from other functions of based on evaluations from other functions of its usefulness and effectiveness and value-its usefulness and effectiveness and value-added to the enterprise as a whole. added to the enterprise as a whole. 18. Demand XF experience for, especially, senior jobs. For example, 18. Demand XF experience for, especially, senior jobs. For example, the U.S. military requires all would-be generals and admirals to have 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 served a full tour in a job whose only goals were cross-functional achievements.achievements.19. “Deep dip.” Dive three levels down in the organization to fill a 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 senior role with some one who has been noticeably pro-active on adding value via excellent cross-functional integration. adding value via excellent cross-functional integration. 20. XFX is … PERSONAL … as well as about organizational 20. XFX is … PERSONAL … as well as about organizational effectiveness. PXFX (Personal XFX) is arguably the #1 Accelerant to effectiveness. PXFX (Personal XFX) is arguably the #1 Accelerant to personal success—in terms of organizational career, freelancer/Brand personal success—in terms of organizational career, freelancer/Brand You, or as entrepreneur. You, or as entrepreneur.

21. 21. Excellence!Excellence! There is a “State of XF Excellence” per se. Talk There is a “State of XF Excellence” per se. Talk it up constantly. Pursue it. Aspire to nothing less.it up constantly. Pursue it. Aspire to nothing less.

EXPLICITLYEXPLICITLY & & VISIBLYVISIBLY & & RELENTLESSLY RELENTLESSLY MANAGE MANAGE

TO XFX STANDARD!TO XFX STANDARD!

ONE DAMN ACT OF XFX ONE DAMN ACT OF XFX ENHANCEMENT ENHANCEMENT

EVERYEVERY DAY! DAY!

““Allied commands depend on Allied commands depend on mutual confidence mutual confidence

and this confidence is and this confidence is gained, above all gained, above all

through thethrough the

develodeveloppmentment ofof friendshifriendshippss.”.”

——General D.D. Eisenhower, General D.D. Eisenhower, Armchair GeneralArmchair General* *

*“Perhaps his most outstanding ability [at West Point]*“Perhaps his most outstanding ability [at West Point]

was the ease with which was the ease with which he made friends and earned he made friends and earned the trust of fellow cadets who came from the trust of fellow cadets who came from

widelwidelyy varied back varied backggroundsrounds; it was a quality that would pay ; it was a quality that would pay great dividends during his future coalition command.”great dividends during his future coalition command.”

““XFX”: Friendship drivenXFX”: Friendship driven!!

InnovateInnovate or Die: or Die:

Measure It!Measure It!

Innovation IndexInnovation Index:: How many of your Top 5Top 5

Strategic Initiatives/Key Projects score 88 or or higherhigher (out of 10) on a

“Weird”“Weird”//“Profound”“Profound”/ / “Wow”“Wow”//“Game-“Game-

changer”changer” Scale? (At least 3???)

Innovation IndexInnovation Index:: Move Move

every project (definition) every project (definition) 22 notches up on the notches up on the

“WOWification “WOWification Scale”Scale” … … THIS THIS

WEEKWEEK. .

InnovateInnovate or Die: or Die:

Ubiquitous!Ubiquitous!

Iron Innovation Equality Law:Iron Innovation Equality Law: The quality and The quality and

quantity and quantity and imaginativenessimaginativeness

of innovation shall be of innovation shall be the same in all the same in all

functionsfunctions —e.g., in HR and —e.g., in HR and purchasing as much as in marketing or purchasing as much as in marketing or

product development.*product development.*

SOME SOME VALUE-ADDED VALUE-ADDED STRATEGIESSTRATEGIES

TGRs:TGRs:8/808/80

CustomersCustomers describing their service describing their service

experience as “superior”: experience as “superior”: 88%%ComComppaniesanies describing describing

the service experience they provide the service experience they provide asas

“ “superior”: superior”: 8080%%——Source: Bain & Company survey of 362 companies, reported in John DiJulius,Source: Bain & Company survey of 362 companies, reported in John DiJulius,

What's the Secret to Providing a World-class Customer Experience?What's the Secret to Providing a World-class Customer Experience?

STUNNING.STUNNING.

Conveyance: Kingfisher Air Conveyance: Kingfisher Air Location: Approach to New DelhiLocation: Approach to New Delhi

““May I clean May I clean your glasses, your glasses,

sir?”sir?”

On a Mumbai to Delhi flight, as we began On a Mumbai to Delhi flight, as we began our approach the flight attendant came our approach the flight attendant came down the aisle in business class and asked down the aisle in business class and asked us if we wished to have our glasses cleaned. us if we wished to have our glasses cleaned. No joke, that’s the sort of “little” thing one No joke, that’s the sort of “little” thing one

remembers … remembers … for a for a lifetimelifetime..

It It BEGINSBEGINS (and (and ENDSENDS) )

in the …in the …

PARKINGPARKING LOTLOT**

*Disney*Disney

Parking lot development at Disney is an art Parking lot development at Disney is an art and a science. The parking lot is a … and a science. The parking lot is a …

Supreme STRATEGIC Asset.Supreme STRATEGIC Asset.

<TG<TGWandand … …

>TG>TGRR(Things Gone (Things Gone WRONG-Things Gone -Things Gone RIGHTRIGHT))

Quality—minimizing things gone wrong—is Quality—minimizing things gone wrong—is of the utmost importance. But fact is, most of the utmost importance. But fact is, most things work pretty well these days. Hence things work pretty well these days. Hence the emphasis associating with the emphasis associating with differentiation switches to the other side of differentiation switches to the other side of

the equation: the equation: THINGS GONE THINGS GONE RIGHTRIGHT..

The trick is to focus—The trick is to focus—systematicallysystematically—on adding to the TGR population.—on adding to the TGR population.

““ExExpperienceseriences are as distinct are as distinct from servicesfrom services

as services are as services are from goods.”from goods.”

—Joe Pine & Jim Gilmore, —Joe Pine & Jim Gilmore, The Experience Economy: The Experience Economy: Work Is Theatre & Every Business a StageWork Is Theatre & Every Business a Stage

CCXXO*O**Chief e*Chief eXXperience Officerperience Officer

I’m urging a I’m urging a “C-level”“C-level” position. position.

TGRTGRSS..MANAGEMANAGE ’EM. ’EM.

MEASUREMEASURE ’EM. ’EM.***I use “manage-measure” a lot. Translation: These are*I use “manage-measure” a lot. Translation: These are

not “soft” ideas; they are exceedingly important things not “soft” ideas; they are exceedingly important things that can be managed—AND measured. that can be managed—AND measured.

TGRs:TGRs: K = R = K = R =

PP

The ultimate “TGR”?The ultimate “TGR”?

““Courtesies of a small and trivial Courtesies of a small and trivial character are the ones which strike character are the ones which strike

deepest in the grateful and deepest in the grateful and appreciating heart.”appreciating heart.” —Henry Clay

“The deepest principle in human “The deepest principle in human nature is the nature is the cravincraving* to be g* to be

appreciated.”appreciated.” —William James—William James

**“Craving,” not “wish” or “desire” or “longing”/Dale Carnegie, “Craving,” not “wish” or “desire” or “longing”/Dale Carnegie, How to WinHow to Win Friends and Influence People Friends and Influence People (“The BIG Secret of Dealing With People”)(“The BIG Secret of Dealing With People”)

“The deepest urge in human nature is “The deepest urge in human nature is the desire to be important.”the desire to be important.” —John Dewey—John Dewey

"Let's not forget "Let's not forget that small that small

emotions are the emotions are the great captains of great captains of our lives."our lives." –—Van Gogh–—Van Gogh

Press Ganey AssocPress Ganey Assoc:: 139,380139,380 former former patients from patients from 225225 hospitals: hospitals:

NONENONE of THE top 15 of THE top 15

factors determining factors determining PPatient atient

SSatisfaction referred to patient’s health atisfaction referred to patient’s health outcomeoutcome..

Instead:Instead: directldirectly related to y related to StaffStaff Interaction;Interaction; directldirectly correlated with y correlated with

EmploEmployyee Satisfactionee Satisfaction

Source: Source: Putting Patients FirstPutting Patients First, Susan Frampton, Laura Gilpin, Patrick Charmel, Susan Frampton, Laura Gilpin, Patrick Charmel

Wow.Wow.

“There is a misconception that supportive interactions There is a misconception that supportive interactions require more staff or more time and are therefore more require more staff or more time and are therefore more costly. Although labor costs are a substantial part of any costly. Although labor costs are a substantial part of any hospital budget, the interactions themselves add nothing hospital budget, the interactions themselves add nothing

to the budget. to the budget.

KINDNESS IS KINDNESS IS FREEFREE.. Listening to patients or Listening to patients or

answering their questions costs nothing. It can be argued answering their questions costs nothing. It can be argued that negative interactions—alienating patients, being that negative interactions—alienating patients, being

non-responsive to their needs or limiting their sense of non-responsive to their needs or limiting their sense of control—can be very costly. … Angry, frustrated or control—can be very costly. … Angry, frustrated or

frightened patients may be combative, withdrawn and frightened patients may be combative, withdrawn and less cooperative—requiring far more time than it would less cooperative—requiring far more time than it would have taken to interact with them initially in a positive have taken to interact with them initially in a positive

way.”way.”

—Putting Patients First—Putting Patients First, Susan Frampton, Laura Gilpin, Patrick Charmel, Susan Frampton, Laura Gilpin, Patrick Charmel (Griffin Hospital/Derby CT; Planetree Alliance) (Griffin Hospital/Derby CT; Planetree Alliance)

K = R = K = R = PP

Kindness = Kindness = Repeat Business =Repeat Business =

Profit.Profit.

K = R = P/Kindness = Repeat business = ProfitK = R = P/Kindness = Repeat business = Profit

Kindness:Kindness:

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

Kindness … Kindness … WORKSWORKS!!

Kindness … Kindness … PAYSPAYS!!

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, AdeccoSteve Harrison, Adecco

TGRs:TGRs:LBTs*LBTs*

*Little BIG Things*Little BIG Things

LITTLE =LITTLE =

BIGBIG

Little Little BIGBIG Things: Things:

Small moves.Small moves.Enormous payoff.Enormous payoff.

(Not every pursuit of major innovation (Not every pursuit of major innovation needs to begin with a $250,000 check!)needs to begin with a $250,000 check!)

Bag sizes = New markets:Bag sizes = New markets:

$B$BSource: PepsiCoSource: PepsiCo

Frito Lay, stuck some years ago with a Frito Lay, stuck some years ago with a string of failed (expensive) new product string of failed (expensive) new product introductions, goes “trivial”—adding some introductions, goes “trivial”—adding some new bag sizes to its potato chip offerings. new bag sizes to its potato chip offerings. E.g., family size, single-serve, etc. E.g., family size, single-serve, etc. Astonishingly, these became fullscale new Astonishingly, these became fullscale new product categories—and added, literally, product categories—and added, literally,

>$1 billion>$1 billion to the top line. to the top line.

Big carts =Big carts =

1.5X1.5XSource: WalmartSource: Walmart

Walmart increases shopping cart size. Big Walmart increases shopping cart size. Big item—microwave ovens, etc.—sales soar item—microwave ovens, etc.—sales soar

… … 50%50%..

120-oz container to ketchup-bottle size laundry-120-oz container to ketchup-bottle size laundry-detergentdetergent concentrate (100% conversion):concentrate (100% conversion):

1/4th packaging; 1/4th weight; 1/4th cost 1/4th packaging; 1/4th weight; 1/4th cost to ship; 1/4th space on ships, trucks, to ship; 1/4th space on ships, trucks,

shelves. 3 years: shelves. 3 years: 95M95M #s plastic resin #s plastic resin

saved, saved, 125M125M #s cardboard conserved, #s cardboard conserved,

400M400M less gallons of water shipped, less gallons of water shipped,

500K500K gallons less diesel fuel, gallons less diesel fuel, 11M11M less #s CO2 released)less #s CO2 released)

Source: Source: Force of Nature: The Unlikely Story of Walmart’s Green RevolutionForce of Nature: The Unlikely Story of Walmart’s Green Revolution, Edward Humes, Edward Humes

2X:2X: “When Friedman“When Friedman

slisligghtlhtly y curvedcurved the right angle of the right angle of

an entrance corridor to one property, an entrance corridor to one property, he was ‘amazed at the magnitude of he was ‘amazed at the magnitude of

change in pedestrians’ behavior’—the change in pedestrians’ behavior’—the percentage who entered increased percentage who entered increased

from from oneone--thirdthird to nearly to nearly twotwo--thirdsthirds.”.”

——Natasha Dow Schull, Natasha Dow Schull, Addiction By Design: Machine Gambling in Las VegasAddiction By Design: Machine Gambling in Las Vegas

Ye gads.Ye gads.(Again, >$1B impact.)(Again, >$1B impact.)

Machine GamblingMachine Gambling

““Pleasing” odor #1 vs. Pleasing” odor #1 vs. “pleasing” odor #2: “pleasing” odor #2:

+45%+45% revenue revenue Source:Source: “Effects of Ambient Odors on Slot-Machine Useage in Las Vegas “Effects of Ambient Odors on Slot-Machine Useage in Las Vegas

Casinos,” reported inCasinos,” reported in Natasha Dow Schull, Natasha Dow Schull, Addiction By Design: Addiction By Design: Machine Gambling in Las Vegas Machine Gambling in Las Vegas (66% revenue, 85% profit)(66% revenue, 85% profit)

Ye gads.Ye gads.

SEE SEE GREENGREEN = RECOVER = RECOVER 20% 20% FASTERFASTER

Hospital patient sees green living material Hospital patient sees green living material out her or his window—recovery times out her or his window—recovery times shrink significantly.shrink significantly.

“PAINT IT WHITE!”— — On Hashem Akbari’s (Lawrence Livermore labs) powerful programOn Hashem Akbari’s (Lawrence Livermore labs) powerful program

to significantly reduce greenhouse gas emissions; using conservativeto significantly reduce greenhouse gas emissions; using conservative

assumptions, it could assumptions, it could reduce 44 billion tons of CO2reduce 44 billion tons of CO2 emissions by cooling buildings, roads, entire cities (emissions by cooling buildings, roads, entire cities (The GuardianThe Guardian, 0116.09), 0116.09)

(1)(1) AMENABLE TO RAPID AMENABLE TO RAPID EXPERIMENTATION/FAILURE “FREE” EXPERIMENTATION/FAILURE “FREE” (NO BAD “PR,” NO $$)(NO BAD “PR,” NO $$)(2)(2) QUICK TO IMPLEMENT/QUICK TO QUICK TO IMPLEMENT/QUICK TO ROLL OUTROLL OUT(3)(3) INEXPENSIVE TO IMPLEMENT/ INEXPENSIVE TO IMPLEMENT/ ROLL OUTROLL OUT(4)(4) HUGE MULTIPLIER HUGE MULTIPLIER(5)(5) AN “ATTITUDE” AN “ATTITUDE”(6) (6) DOES NOT BY AND LARGE REQUIRE ADOES NOT BY AND LARGE REQUIRE A “ “POWER POSITION” FROM WHICHPOWER POSITION” FROM WHICH TO LAUNCH EXPERIMENTS.TO LAUNCH EXPERIMENTS.

The Little = BIG approach is available The Little = BIG approach is available to most to most ananyybodbody, regardless of y, regardless of location on the organization chart or location on the organization chart or location on the corporate totem pole! location on the corporate totem pole!

Social Business/ Social Business/ Customer Customer

EngagementEngagement

““Customer engagement is Customer engagement is moving from relatively isolated moving from relatively isolated market transactions to deeply market transactions to deeply connected and sustained social connected and sustained social relationships. relationships. This basic chanThis basic changge e in how we do business will make in how we do business will make

an iman imppact on act on jjust about ust about evereveryythinthingg we do we do.”.”

Social Business By Design: Transformative Social Media StrategiesSocial Business By Design: Transformative Social Media Strategies For the Connected CompanyFor the Connected Company —Dion Hinchcliffe & Peter Kim —Dion Hinchcliffe & Peter Kim

Biz 2014: Get Aboard the “S-Train”Biz 2014: Get Aboard the “S-Train”

SMSM//Social Media.Social Media.

SXSX//Social eXecutives.Social eXecutives.

SESE//Social Employees.Social Employees.

SOSO//Social Social Organization.Organization.

SBSB//Social Business.Social Business.

““Social” is a … New World Order. Social” is a … New World Order. Among other things: Among other things:

We’re We’re ALLALL in marketing. in marketing.

We’re We’re ALLALL in sales. in sales.

We’re We’re ALLALL in brand maintenance and in brand maintenance and development.development.

Seven Characteristics of the Social EmployeeSeven Characteristics of the Social Employee

1. 1. Engaged Engaged 2. 2. Expects Integration of the Expects Integration of the

Personal and ProfessionalPersonal and Professional3. 3. Buys Into the Brand’s StoryBuys Into the Brand’s Story4. 4. Born CollaboratorBorn Collaborator5. 5. ListensListens6. 6. Customer-CentricCustomer-Centric7. 7. Empowered Change AgentEmpowered Change Agent

Source: Cheryl Burgess & Mark Burgess, Source: Cheryl Burgess & Mark Burgess, The Social EmployeeThe Social Employee

““Social”:Social”:

I call it … I call it … EMPOWEMENT EMPOWEMENT ON STEROIDSON STEROIDS..

Marbles, a Ball and Social Employees ay IBM Marbles, a Ball and Social Employees ay IBM

““Picture a ball and a bag of marbles side by side. The two Picture a ball and a bag of marbles side by side. The two items might have the same volume—that is, if you dropped items might have the same volume—that is, if you dropped them into a bucket, they would sisplace the same amount them into a bucket, they would sisplace the same amount of water. The difference, however, lies in the surface area, of water. The difference, however, lies in the surface area,

Because a baBecause a bagg of marbles is of marbles is comcompprised of several individual rised of several individual

ppieces, the combined surface area of ieces, the combined surface area of all the marbles far outstriall the marbles far outstripps the s the

surface area of a sinsurface area of a singgle ballle ball.. The expanded The expanded surface area represents a social brand’s increased surface area represents a social brand’s increased

diversity. These surfaces connect and interact with each diversity. These surfaces connect and interact with each other in unique ways, offering customers and employees other in unique ways, offering customers and employees alike a variety of paths toward a myriad of solutions. If alike a variety of paths toward a myriad of solutions. If

none of the paths prove to be suitable, social employees none of the paths prove to be suitable, social employees can carve out new paths on their own.”can carve out new paths on their own.” —Ethan McCarty, Director of —Ethan McCarty, Director of

Enterprise Social Strategy, IBM (from Cheryl Burgess & Mark Burgess, Enterprise Social Strategy, IBM (from Cheryl Burgess & Mark Burgess, The Social The Social EmployeeEmployee

To do the “social thing” right—in a way To do the “social thing” right—in a way that maximizes value added—we must that maximizes value added—we must get very serious about employee get very serious about employee engagement. Each employee now engagement. Each employee now wields enormous power and wields enormous power and responsibility. The upside is simply …responsibility. The upside is simply …

ENORMOUSENORMOUS..

Social Business/Social Business/New Ball GameNew Ball Game

““We’re moving toward an age of nearly perfect We’re moving toward an age of nearly perfect information. Review sites, shopping apps on information. Review sites, shopping apps on

smartphones, an extended network of acquaintances smartphones, an extended network of acquaintances available through social media, and unprecedented available through social media, and unprecedented access to experts mean that consumers operate in a access to experts mean that consumers operate in a radically different, socially interactive information radically different, socially interactive information environment.* … Consumers tend to make better environment.* … Consumers tend to make better

decisions and become less susceptible to context or decisions and become less susceptible to context or framing manipulations. For businesses, it means framing manipulations. For businesses, it means

marketing is changing forever.”marketing is changing forever.”

—Itamar Simonson and Emanuel Rosen, —Itamar Simonson and Emanuel Rosen, Absolute Absolute Value:Value: What Really Influences Customers in the What Really Influences Customers in the

Age of (Nearly) Perfect InformationAge of (Nearly) Perfect Information

*Google:*Google: ZMOTZMOT (ZERO Moment Of Truth)(ZERO Moment Of Truth)

The purchasing process is upended.The purchasing process is upended.

Flipped Flipped 180180 degrees. degrees.

ZMOTZMOT:: ZERO Moment Of Truth/Google ZERO Moment Of Truth/Google**

““You know what a ‘moment of truth’ is. It’s when a prospective You know what a ‘moment of truth’ is. It’s when a prospective customer decides either to take the next step in the purchase customer decides either to take the next step in the purchase funnel, or to exit and seek other options. … But what is a ‘zero funnel, or to exit and seek other options. … But what is a ‘zero moment of truth’? Many behaviors can serve as a zero moment moment of truth’? Many behaviors can serve as a zero moment of truth, but what binds them together is that the purchase is of truth, but what binds them together is that the purchase is

being researched and considered before the prospect even being researched and considered before the prospect even enters the classic sales funnel … In its research, Google found enters the classic sales funnel … In its research, Google found

that that 84%84% of shoppers said the new mental of shoppers said the new mental

model, ZMOT, shapes their decisions. …” model, ZMOT, shapes their decisions. …”

——Jay Baer, Jay Baer, Youtility: Why Smart Marketing Is About Help, Not HypeYoutility: Why Smart Marketing Is About Help, Not Hype

*See www.zeromomentoftruth.com for ZMOT in booklength format*See www.zeromomentoftruth.com for ZMOT in booklength format

““Amy HowellAmy Howell [social marketer extraordinaire, [social marketer extraordinaire,

founder of Howell Marketing]founder of Howell Marketing] ignites ignites epidemics. In a good way, epidemics. In a good way,

of course. Epidemics of of course. Epidemics of excitement. Epidemics of excitement. Epidemics of

business connections. business connections. Epidemics of influence.”Epidemics of influence.”

——Mark Schaeffer,Mark Schaeffer, ROI/Return on Influence: The Revolutionary ROI/Return on Influence: The Revolutionary Power of Klout, Social Scoring, and Influence MarketingPower of Klout, Social Scoring, and Influence Marketing

New job description, circa 2014.New job description, circa 2014.

DESIGNDESIGN!!

Design Design RulesRules!!

APPLEAPPLE market cap market cap > Exxon Mobil* > Exxon Mobil*

*August 2011*August 2011

When Apple’s market cap shot past When Apple’s market cap shot past Exxon Mobil’s, there was no longer any Exxon Mobil’s, there was no longer any

issue about … issue about … “DESIGN “DESIGN POWER.”POWER.” Now only Now only

idiots will ignore it—in enterprises of idiots will ignore it—in enterprises of any and every size and flavor.any and every size and flavor.

““YouYou knowknow a a designdesign isis goodgood

whenwhen you you want want to to licklick itit.”.” —Steve Jobs—Steve Jobs

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

Go SteveGo Steve!!

All EAll Eqqual ual ExceExcepptt … …

“At Sony we assume that all “At Sony we assume that all products of our competitors products of our competitors

have basically the same have basically the same technology, price, performance technology, price, performance

and features.and features. DesiDesiggn is the n is the onlonlyy thin thingg that that

differentiates one differentiates one pproduct from another roduct from another in the marketin the marketpplacelace.”.” ——

NorioNorio OhgaOhga

The glory days.The glory days.

““Design is Design is

treated like treated like a relia religgionion at at

BMW.”BMW.” —Fortune—Fortune

““With its carefully conceived mix of colors and textures, With its carefully conceived mix of colors and textures,

aromas and music,aromas and music, STARBUCKSSTARBUCKS is more is more indicative of our era than the iMac. It is to the indicative of our era than the iMac. It is to the AAggee ofof

AestheticsAesthetics what McDonald’s was to the what McDonald’s was to the AAggee ofof ConvenienceConvenience or Ford was to the Age of Mass Production— or Ford was to the Age of Mass Production—

the touchstone success story, the exemplar of … the the touchstone success story, the exemplar of … the

aesthetic imperative. …aesthetic imperative. … ‘Every Starbucks ‘Every Starbucks store is carefully designed to store is carefully designed to

enhance the quality of everything enhance the quality of everything the customers see, touch, hear, the customers see, touch, hear,

smell or taste,’smell or taste,’ writes CEO Howard Schultz.”writes CEO Howard Schultz.” —Virginia Postrel, —Virginia Postrel, The Substance of Style: How the Rise of AestheticThe Substance of Style: How the Rise of Aesthetic

Value Is Remaking Commerce, Culture and ConsciousnessValue Is Remaking Commerce, Culture and Consciousness

““We don’t have a good language to talk We don’t have a good language to talk about this kind of thing. In most people’s about this kind of thing. In most people’s

vocabularies, design means veneer. … vocabularies, design means veneer. … But to me, nothing could be further from But to me, nothing could be further from

the meaning of design.the meaning of design. DESIGNDESIGN IS THE IS THE

FUNDAMENTALFUNDAMENTAL SOULSOUL OF A MAN-MADE OF A MAN-MADE

CREATION.”CREATION.” —Steve Jobs—Steve Jobs

Hypothesis:Hypothesis: DESIGNDESIGN is the is the pprincirincippalal

differencedifference

between between lovelove

and and hate!*hate!**Not “like” and “dislike”

Design is …Design is …

NEVERNEVER neutralneutral..

Design, though emphasizing Design, though emphasizing functionality as well as aesthetics, is functionality as well as aesthetics, is primarily about an … primarily about an …

emotional reactionemotional reaction … to … to a product or service. a product or service.

Not “like” or “dislike.” Not “like” or “dislike.” Rather: “Love” or “hate.”Rather: “Love” or “hate.”

Powerful stuff! Powerful stuff!

““Design is Design is evereveryythinthing. g. Everything is Everything is desidesiggnn.”.”

““We are We are allall designers.” designers.”

Inspiration:Inspiration: The Power of Design: A Force for The Power of Design: A Force for Transforming Everything, Transforming Everything, Richard FarsonRichard Farson

““PACKAGESPACKAGES … … are about are about containincontainingg and and labelinlabelingg

and and informininformingg and and celebratincelebratingg. . TheyThey

are about are about ppowerower and and flatterflatteryy and and trying to win people’s trying to win people’s trusttrust. They . They

are about are about beautbeautyy and and craftsmanshicraftsmanshipp and and comfortcomfort. They . They

are about are about colorcolor, , pprotectionrotection, ,

survivalsurvival.”.” –Thomas Hine, –Thomas Hine, The Total PackageThe Total Package

An encompassing view of design … in An encompassing view of design … in packaging.packaging.

““Only one company Only one company can be the cheapest. can be the cheapest. All others must use All others must use design.”design.” —Rodney Fitch, Fitch & Co.—Rodney Fitch, Fitch & Co.

Source: Source: InsightsInsights, definitions of design, the Design Council (UK), definitions of design, the Design Council (UK)

Not a silly assertion.Not a silly assertion.

Ann Landers as management guru/Ann Landers as management guru/Three criteria for products, projects, a Three criteria for products, projects, a communication, etc.: communication, etc.:

Good.Good. True.True. Helpful.Helpful.

Nice.Nice.(Interesting source, eh?)(Interesting source, eh?)

CCDDOO***Chief *Chief DDesignesign Officer Officer

A … A … Chief Design OfficerChief Design Officer … is … is a clear need in a sizeable a clear need in a sizeable organization.organization.

And some form of CDO assignment is/can And some form of CDO assignment is/can be of abiding importance in the smallest of be of abiding importance in the smallest of firms. firms.

Again: Again: RegardlessRegardless of industry. of industry.

““Businesspeople don’t Businesspeople don’t need to ‘understand need to ‘understand

designers better.’ designers better.’ Businesspeople need to Businesspeople need to

bebe designers.” designers.”

—Roger Martin/Dean/Rotman Management School/University of Toronto—Roger Martin/Dean/Rotman Management School/University of Toronto

Design is …Design is …

* * The reception areaThe reception area* * The loo!!The loo!!* * Dialogues at the call centerDialogues at the call center* * EveryEvery electronic (or paper) form electronic (or paper) form* * EveryEvery business process “map” business process “map”* * EveryEvery email email* * EveryEvery meeting agenda/setting/etc. meeting agenda/setting/etc.* * EveryEvery square meter of every facility square meter of every facility* * EveryEvery new product proposal new product proposal* * EveryEvery manual manual* * EveryEvery customer contact customer contact* * A consideration in A consideration in everyevery promotion decision promotion decision* * The presence and ubiquity of an “Aesthetic sensibility”/The presence and ubiquity of an “Aesthetic sensibility”/ “Design mindfulness” “Design mindfulness”* * An encompassing “design review” processAn encompassing “design review” process* * Etc.Etc.* * Etc.Etc.

HHypypothesisothesis: Men : Men

CANNOTCANNOT design for women’s design for women’s

needsneeds!!??!!??

Sooooo …..Sooooo …..

Women BUY Women BUY (Everything)(Everything)!!

““Forget CHINA, Forget CHINA, INDIA and the INDIA and the

INTERNET: Economic INTERNET: Economic Growth Is Driven by Growth Is Driven by

WOMENWOMEN.”.”

Source: Headline, Economist

Not an iota of exaggeration.Not an iota of exaggeration.(But many a missed opportunity.)(But many a missed opportunity.)

““Since 1970, women have held two out of Since 1970, women have held two out of three new jobs. According to the three new jobs. According to the EconomistEconomist, ,

which compiled studies from a number of which compiled studies from a number of research firms, the arrival of this new research firms, the arrival of this new

workforce has done more to encourage workforce has done more to encourage global growth than increases in capital global growth than increases in capital

investment and improvements in investment and improvements in productivity. ‘Over the last 10 years the productivity. ‘Over the last 10 years the increase in women [in the workplace] in increase in women [in the workplace] in developed countries has made more of a developed countries has made more of a contribution to global growth than China contribution to global growth than China

has,’ concludes the British weekly.”has,’ concludes the British weekly.”

Source: “Women Are Drivers of Global Growth,” Aude Zieseniss de Thuin, Source: “Women Are Drivers of Global Growth,” Aude Zieseniss de Thuin,

founder and president of the Women’s Forum for the Economy and Society (founder and president of the Women’s Forum for the Economy and Society (FTFT))

W W > > 2X2X (C + (C + I)*I)*

**“Women now drive the global economy. Globally, they control about “Women now drive the global economy. Globally, they control about $20 trillion in consumer spending, and that figure could climb as high as $20 trillion in consumer spending, and that figure could climb as high as

$28 trillion$28 trillion in the next five years. in the next five years.

Their $13 trillion in total yearly earnings could reach $18 trillion in the Their $13 trillion in total yearly earnings could reach $18 trillion in the same period.same period. In aggregate, women represent a growth market bigger than China and India combined—more 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. 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 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 …”comes to women. Consider Dell’s …”

Source: Michael Silverstein and Kate Sayre, “The Female Economy,” Source: Michael Silverstein and Kate Sayre, “The Female Economy,” HBRHBR, 09.09, 09.09

$28,000,000,000,00$28,000,000,000,000.0.

(Lots of ZEROS.)(Lots of ZEROS.)

““Women areWomen are THETHE majority majority

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

Women as Decision Makers/Various sourcesWomen as Decision Makers/Various sources

Home Furnishings … Home Furnishings … 94%94%Vacations … Vacations … 92%92% (Adventure Travel … 70%/ $55B travel equipment)(Adventure Travel … 70%/ $55B travel equipment)

Houses … Houses … 91%91%D.I.Y. D.I.Y. (major “home projects”)(major “home projects”) … … 80%80%

Consumer Electronics … Consumer Electronics … 51%51% (66% home computers)(66% home computers)

Cars … Cars … 68%68% (influence (influence 90%90%))

AllAll consumerconsumer p purchasesurchases … … 83%83% **

Bank Account … Bank Account … 89%89%Household investment decisions … Household investment decisions … 67%67%Small business loans/biz starts … Small business loans/biz starts … 70%70%

Health Care … Health Care … 80%80%*In the USA women hold *In the USA women hold >50%>50% managerial positions including managerial positions including >50%>50% purchasing officer purchasing officer positions positions; hence women also make the majority of ; hence women also make the majority of commercialcommercial purchasing decisions. purchasing decisions.

Women as …Women as …

Purchasing agents: Purchasing agents: 55%55%Purchasing managers: Purchasing managers: 42%42%Wholesale/retail buyers: Wholesale/retail buyers: 52%52%Employee health-benefitEmployee health-benefit

plans: plans: 60%60%Source: Martha Barletta/TrendSight Group/0517.11Source: Martha Barletta/TrendSight Group/0517.11

With stats like these, one can see that With stats like these, one can see that women are driving the purchase of the women are driving the purchase of the

bulk of bulk of commercial goodscommercial goods, , not just consumer goods.not just consumer goods.

““The The MOST MOST SIGNIFICANT SIGNIFICANT

VARIABLEVARIABLE inin EVERYEVERY sales situation is thesales situation is the

GENDERGENDER of the buyer, and of the buyer, and more importantly, how the more importantly, how the

salesperson communicates to salesperson communicates to the buyer’s gender.”the buyer’s gender.”

—Jeffery Tobias Halter, Selling to Men, Selling to Women

The Perfect Answer

Jill and Jack buy slacks in black…

Gets a belly laugh in my speeches—and Gets a belly laugh in my speeches—and (almost) all agree it’s true.(almost) all agree it’s true.

Sales/After-sales ProcessSales/After-sales Process

1.    Kick-off  – 1.    Kick-off  – WomenWomen2.    Research – 2.    Research – WomenWomen3.    Purchase  – 3.    Purchase  – Men4.    Ownership – 4.    Ownership – WomenWomen5.    Word-of-mouth – 5.    Word-of-mouth – WomenWomen

Source: Martha Barletta, Source: Martha Barletta, Marketing to Women: How to Increase Your Share of the World’s Largest MarketMarketing to Women: How to Increase Your Share of the World’s Largest Market

She still allows him to preserve his ego She still allows him to preserve his ego by signing the check—though women by signing the check—though women are now the primary breadwinner in a are now the primary breadwinner in a large share of families.large share of families.

WeWe (old farts like me)(old farts like me) Got Got

the the $$$$$$$$$$$$

1/8/201/8/20

USA:USA:

1 boomer will turn 1 boomer will turn 6565Every Every 8 SECONDS8 SECONDSFor the next For the next 20 YEARS20 YEARS..

((AndAnd the boomers have the money— the boomers have the money—andand the time to spend it.) the time to spend it.)

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!““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

This one really put things in This one really put things in perspective for me.perspective for me.

PROFOUNDPROFOUND..

Profound CONSEQUENCES.Profound CONSEQUENCES.

““In 2009, households headed by In 2009, households headed by adults ages 65 and older ... had adults ages 65 and older ... had

4747 timestimes as much as much

net wealth as the typical net wealth as the typical household headed by someone household headed by someone under 35 years of age. In 1984, under 35 years of age. In 1984, this had been a less lopsided this had been a less lopsided

10-to-1 ratio.”10-to-1 ratio.”

Source: Pew Research/10.11Source: Pew Research/10.11

1/8/201/8/20 (One USA boomer will turn 65 every 8 seconds for (One USA boomer will turn 65 every 8 seconds for

the next 20 years.)the next 20 years.)

10/1/2210/1/22 (USA adult population will have grown by 23 (USA adult population will have grown by 23

million between 2006 and 2016. Ages 18-49 will have grown by a million between 2006 and 2016. Ages 18-49 will have grown by a million, age 50+ will have grown by 22 million.)million, age 50+ will have grown by 22 million.)

>50@50>50@50 (At age 50, we have more than 50% of our (At age 50, we have more than 50% of our

adult life ahead of us.) adult life ahead of us.)

7/137/13 (An American will buy 13 cars in the course of a (An American will buy 13 cars in the course of a

lifetime—7 after the age of 50.)lifetime—7 after the age of 50.)

10-2510-25 (Boomers inherit $10-25 trillion in the next 20 (Boomers inherit $10-25 trillion in the next 20

years.)years.)

47X47X (Net wealth of households headed by 65+ is 47X (Net wealth of households headed by 65+ is 47X

greater than net wealth of households headed by someone <35.)greater than net wealth of households headed by someone <35.)

55+ > 55-55+ > 55- (55-plus are more active in online (55-plus are more active in online

finance, shopping and entertainment than those under 55)finance, shopping and entertainment than those under 55)

44-6544-65:: “NEW “NEW CUSTOMER CUSTOMER MAJORITY”MAJORITY”

Source: Source: Ageless MarketingAgeless Marketing, David Wolfe & Robert Snyder, David Wolfe & Robert Snyder

““BabBabyy-boomer -boomer WomenWomen: The: The Sweetest of Sweetest of

Sweet Spots for Sweet Spots for Marketers”Marketers”

—David Wolfe and Robert Snyder, —David Wolfe and Robert Snyder, Ageless MarketingAgeless Marketing

““Marketers’ attempts at reaching Marketers’ attempts at reaching those over 50 have been miserably those over 50 have been miserably

unsuccessful.unsuccessful. No No market’s market’s

motivations andmotivations and needs are so needs are so

poorlpoorlyy understoodunderstood.”.”

——Peter Francese, founding publisher, Peter Francese, founding publisher, American DemographicsAmerican Demographics

““The New Customer The New Customer Majority is the … Majority is the …

ONLYONLY … adult market … adult market with realistic prospects with realistic prospects

for significant sales for significant sales growth in dozens of growth in dozens of

product lines for product lines for thousands of thousands of companies.”companies.”

—David Wolfe & Robert Snyder, —David Wolfe & Robert Snyder, Ageless MarketingAgeless Marketing

““Households headed by Households headed by someone 40 or older enjoy 91% someone 40 or older enjoy 91% of our population’s net worth. of our population’s net worth. … The mature market is the … The mature market is the dominant market in the U.S. dominant market in the U.S.

economy, economy, makinmakingg the ma the majjoritorityy of exof exppenditures in virtuallenditures in virtually y

evereveryy categor category.”y.” —Carol Morgan & Doran Levy, —Carol Morgan & Doran Levy,

Marketing to the Mindset of Boomers and Their EldersMarketing to the Mindset of Boomers and Their Elders

““Fifty-four years of age has been Fifty-four years of age has been the highest cutoff point for any the highest cutoff point for any marketing initiative I’ve ever marketing initiative I’ve ever

been involved in. been involved in. Which is pretty weird when you consider age 50 is right about when people who have worked all their lives start to have some money to spend.”

—Marti Barletta, —Marti Barletta, PrimeTime WomenPrimeTime Women

““One particularly puzzling category of youth-One particularly puzzling category of youth-obsession is the highly coveted target of men obsession is the highly coveted target of men 18-34, and it’s always referred to as ‘highly 18-34, and it’s always referred to as ‘highly

coveted category.’ Marketers have been coveted category.’ Marketers have been distracted by men age 18-34 because they are distracted by men age 18-34 because they are getting harder to reach. So what? getting harder to reach. So what? Who wants Who wants

to reach them?to reach them? Beyond fast food and beer, Beyond fast food and beer, they don’t buy much of anything. … The they don’t buy much of anything. … The

theory is that if you ‘get them while they’re theory is that if you ‘get them while they’re

young, they’re yours for life.’young, they’re yours for life.’ What nonsense!”

——Marti Barletta, Marti Barletta, PrimeTime WomenPrimeTime Women

We are the We are the Aussies & Kiwis &Aussies & Kiwis & Americans & CanadiansAmericans & Canadians. . We are the We are the Western EuropeansWestern Europeans & & JapaneseJapanese. We are . We are the the fastest growingfastest growing, the , the biggestbiggest, the , the

wealthiestwealthiest, the , the boldestboldest, the most , the most (yes) (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 & experience service & experience obsessedobsessed, the most , the most vigorousvigorous, (the , (the leastleast vigorous,) vigorous,) the most the most health conscioushealth conscious, the most , the most femalefemale, the , the

most profoundly important commercial market in the most profoundly important commercial market in the

history of the world—and history of the world—and we will be we will be the Center of the Center of yyour our

universe for the next universe for the next twenttwentyy-five -five yyearsears.. We have We have

arrived!arrived!

To an astonishing degree, a missed To an astonishing degree, a missed opportunity.opportunity.

The The (ENORMOUS)(ENORMOUS) “Services “Services

Added” Added” OpportunityOpportunity

““You are headed You are headed for commodity for commodity

hell if you don’t hell if you don’t have services.”have services.”

—Lou Gerstner, on IBM’s revolution (1997)—Lou Gerstner, on IBM’s revolution (1997)

IBIBMMtoto

IIBBMM

In the 1990s, with its old businesses in In the 1990s, with its old businesses in retreat, IBM began a rapid & radical retreat, IBM began a rapid & radical transformation from hardware to transformation from hardware to services.services.

““Never mind computers Never mind computers and tech services. and tech services.

IBM’s radical new focus IBM’s radical new focus isis

on revamping on revamping customers’ operationscustomers’ operations—and running them.”—and running them.”

—Headline/ BW—Headline/ BW

PlanetarPlanetary y RainmakerRainmaker--inin--ChiefChief!!

“[CEO Sam] Palmisano’s “[CEO Sam] Palmisano’s strategy is to expand tech’s strategy is to expand tech’s borders by pushing users—borders by pushing users—

and entire industries—and entire industries—towardtoward radicallradically y differentdifferent businessbusiness modelsmodels.. The payoff for IBM would be The payoff for IBM would be

access to an ocean of revenue—Palmisano access to an ocean of revenue—Palmisano

estimates it atestimates it at $$500500 billionbillion aa y yearear ——that technology companies have never been that technology companies have never been

able to touch.”able to touch.” ——FortuneFortune

$50B*$50B**IBM Global Services/*IBM Global Services/

“Systems integrator of choice”“Systems integrator of choice”

IBM is the poster child of this “movement.” In the IBM is the poster child of this “movement.” In the early ’90s, new CEO Lou Gerstner was ordered by early ’90s, new CEO Lou Gerstner was ordered by the board to break up the company. Before the board to break up the company. Before complying, he made a round-the-world customer complying, he made a round-the-world customer tour. He discovered that his customers were not by tour. He discovered that his customers were not by and large dissatisfied with IBM’s products—and large dissatisfied with IBM’s products—thetheyy were uwere uppset that their vast arraset that their vast arrayy of IBM of IBM pproducts had roducts had not been intenot been integgrated in a warated in a wayy that allowed the client that allowed the client to achieve to achieve ppromised enterromised enterpprise-wide gains in rise-wide gains in business effectivenessbusiness effectiveness. .

Gerstner found a small extant consulting unit—and Gerstner found a small extant consulting unit—and recast it as IBM Global Services; its goal was to use recast it as IBM Global Services; its goal was to use the new tools to enable no less than total enterprise the new tools to enable no less than total enterprise transformation. In surprisingly short order, Global transformation. In surprisingly short order, Global Services became the dog that wags the tail— a Services became the dog that wags the tail— a

$50 billion++$50 billion++ unit, essentially the world’s unit, essentially the world’s largest consultancy, that indeed assists re-largest consultancy, that indeed assists re-imagining/re-inventing/re-positioning their entire imagining/re-inventing/re-positioning their entire firm!firm!

(As to the IB(As to the IBMM on the slide—the “M”/machine is now on the slide—the “M”/machine is now more or less secondary.)more or less secondary.)

UUPPSS toto

UPUPSS

““Big Brown’s New Bag: UPS Aims Big Brown’s New Bag: UPS Aims to Be the Traffic Manager for to Be the Traffic Manager for Corporate America”Corporate America” —Headline/—Headline/BWBW

“UPS wants to take over the sweet “UPS wants to take over the sweet spot in the endless loop of goods, spot in the endless loop of goods,

information and capital that all the information and capital that all the packages packages [it moves][it moves] represent.” represent.” —ecompany.com —ecompany.com

“It’s all about “It’s all about solutionssolutions. We . We work with customers on creating work with customers on creating

and running better, stronger, and running better, stronger, cheaper supply chains.”cheaper supply chains.” —Bob Stoffel, UPS —Bob Stoffel, UPS

senior exec senior exec

UPS still has 10s of thousands of UPS still has 10s of thousands of trucks, but it is also becoming a major trucks, but it is also becoming a major provider of integrated logistics provider of integrated logistics services—master of the all-important services—master of the all-important supply chain.supply chain.

““Rolls-RoyceRolls-Royce now earns now earns

moremore from tasks such from tasks such as managing clients’ as managing clients’ overall procurement overall procurement

strategies and maintaining strategies and maintaining aerospace engines it sells aerospace engines it sells than it does from making than it does from making

them.”them.”——EconomistEconomist

IDEOIDEO

Product DesignProduct DesignProduct Design Product Design

TrainingTrainingInnovation TrainingInnovation Training

The big company examples are readily The big company examples are readily translatable into the world of smaller translatable into the world of smaller

firms. firms. IDEOIDEO, the peerless product , the peerless product design firm based in Palo Alto, was design firm based in Palo Alto, was asked by (big/very big) clients if its asked by (big/very big) clients if its legendary approach to creativity could legendary approach to creativity could be imported into their firms. The be imported into their firms. The answer was a resounding yes—and answer was a resounding yes—and IDEO now has a thriving business IDEO now has a thriving business helping others improve their creative helping others improve their creative and product development processes.and product development processes.

Era #1/Obvious ValueEra #1/Obvious Value: “Our ‘it’ works, : “Our ‘it’ works, is delivered on time” (“Close”)is delivered on time” (“Close”)

Era #2/Augmented ValueEra #2/Augmented Value: : “How our “How our ‘it’ can add value—a ‘useful it’ ” ‘it’ can add value—a ‘useful it’ ”

(“Solve”)(“Solve”)

Era #3/Complex Value NetworksEra #3/Complex Value Networks: : “How “How our ‘system’ can change you and our ‘system’ can change you and

deliver deliver ‘BUSINESS ADVANTAGE’‘BUSINESS ADVANTAGE’” ” (“Culture-Strategic change”)(“Culture-Strategic change”)

Source: Jeff Thull, Source: Jeff Thull, The Prime Solution: Close the Value Gap,The Prime Solution: Close the Value Gap, Increase Margins, and Win the Complex Sale Increase Margins, and Win the Complex Sale

BIG deal.BIG deal.

VERYVERY big deal. big deal.

AND THE AND THE WINNERS WINNERS

AREN’T/AREAREN’T/ARE

-1/+1/2-1/+1/2

S&P 500S&P 500

+1/-1*+1/-1*

*Every …*Every … 22 weeksweeks!!Source: Richard Foster (via Rita McGrath/Source: Richard Foster (via Rita McGrath/HBRHBR/12.26.13/12.26.13

I was staggered by this. The S&P 500 I was staggered by this. The S&P 500 defines the USA economy. The BIGGEST defines the USA economy. The BIGGEST of the BIG guys. And yet one drops off of the BIG guys. And yet one drops off the list … every 2 weeks.the list … every 2 weeks.

Wow!Wow!

““Mr. Foster and his McKinsey colleagues Mr. Foster and his McKinsey colleagues collected detailed performance data stretching collected detailed performance data stretching

back back 4040 years for years for 1,0001,000 U.S. companies. U.S. companies. TheTheyy found that found that

NONENONE ofof

the lonthe longg-term survivors mana-term survivors managged ed to outto outpperform the market. Worse, erform the market. Worse, the lonthe longger comer comppanies had been in anies had been in

the database, the worse thethe database, the worse theyy did did.” .” —Financial Times—Financial Times

Big company performance is, shall we Big company performance is, shall we say, problematic. (I could provide a say, problematic. (I could provide a hundred more equally compelling hundred more equally compelling slides.)slides.)

THETHE RED RED CARPET CARPET STORESTORE

(Joel Resnick/Flemington NJ)(Joel Resnick/Flemington NJ)

My favorite company. Provide the red My favorite company. Provide the red carpet for the Oscars, etc., etc., etc.carpet for the Oscars, etc., etc., etc.

They They dominatedominate//ownown their their niche.niche.

Cool.Cool.

VERYVERY cool. cool.

*Basement Systems Inc. *Basement Systems Inc. (Larry Janesky/Seymour CT)(Larry Janesky/Seymour CT)

**Dry Basement ScienceDry Basement Science (100,000++ copies!) (100,000++ copies!)*1990: $0; 2003: $13M; *1990: $0; 2003: $13M;

2010: 2010: $80,000,000$80,000,000

Larry Janesky turns damp moldy Larry Janesky turns damp moldy basements into dry storage areas, basements into dry storage areas, family rooms, etc. He is … family rooms, etc. He is …

Mr. BasementMr. Basement … and … and

has the patents & profits to prove it.has the patents & profits to prove it.

The Magicians of The Magicians of MotuekaMotueka (PLUS) (PLUS)!!

W.A. Coppins Ltd.*W.A. Coppins Ltd.*(Coppins Sea Anchors/(Coppins Sea Anchors/PSA/para sea anchors)PSA/para sea anchors)

*Textiles, 1898; thrive on *Textiles, 1898; thrive on “wicked problems”“wicked problems”——e.g., e.g., U.S. NavyU.S. Navy STLVAST (Small To Large Vehicle At Sea STLVAST (Small To Large Vehicle At Sea

Transfer); custom fabric from Transfer); custom fabric from W. WiW. Wiggggins Ltdins Ltd./Wellington ./Wellington

(specialty nylon, “Dyneema,” from (specialty nylon, “Dyneema,” from DSMDSM/Netherlands)/Netherlands)

Motueka, New Zealand, is a peanut-Motueka, New Zealand, is a peanut-sized town. (Very near where I live in sized town. (Very near where I live in the winter.) But it sports best-in-world the winter.) But it sports best-in-world in the high-value-added business of in the high-value-added business of sea anchors. Clients include the U.S. sea anchors. Clients include the U.S. Navy and the Norwegian government.Navy and the Norwegian government.

Grooves on … Grooves on … “wicked “wicked problems.”problems.”(I organized a keynote speech to New Zealand’s business and (I organized a keynote speech to New Zealand’s business and government leaders around W.A. Coppins—an exemplar of global government leaders around W.A. Coppins—an exemplar of global business “domination” in a small corner of a small country.)business “domination” in a small corner of a small country.)

Going “Social”: Location and Size IndependentGoing “Social”: Location and Size Independent

““Today, despite the fact that we’re jToday, despite the fact that we’re just a little swimminust a little swimmingg ppool comool comppananyy in Vir in Virgginiainia, we have the most trafficked , we have the most trafficked swimming pool website in the world. Five years ago, if swimming pool website in the world. Five years ago, if you’d asked me and my business partners what we do, you’d asked me and my business partners what we do,

the answer would have been simple, ‘We build in-ground the answer would have been simple, ‘We build in-ground

fiberglass swimming pools.’ Now we say,fiberglass swimming pools.’ Now we say, ‘We ‘We are the best teachersare the best teachers … … in the worldin the world … on the … on the subject of fiberglass swimming subject of fiberglass swimming

pools, and we also happen to build pools, and we also happen to build them.’”them.’”

——Jay Baer, YJay Baer, Youtility: Why Smart Marketing Is About Help, Not Hypeoutility: Why Smart Marketing Is About Help, Not Hype

A small swimming pool firm takes to A small swimming pool firm takes to social media with a vengeance and social media with a vengeance and

becomes a major becomes a major (world)(world)

force in its market space.force in its market space.

““BE THE BEST. BE THE BEST. IT’S THE ONLY IT’S THE ONLY

MARKET THAT’S MARKET THAT’S NOT CROWDED.”NOT CROWDED.”

From: From: Retail Superstars: Inside the 25 BestRetail Superstars: Inside the 25 Best Independent Stores in America,Independent Stores in America, George Whalin George Whalin

I I LOVELOVE this sentence this sentence

——and and LOVELOVE the firms that embody the firms that embody it.it.

Retail Superstars: Retail Superstars: Inside the 25 Best Inside the 25 Best

Independent StoresIndependent Storesin Americain America —by George Whalin—by George Whalin

JUNGLE JIM’S INTERNATIONAL MARKET, FAIRFIELD, OHJUNGLE JIM’S INTERNATIONAL MARKET, FAIRFIELD, OH::

““An adventure in An adventure in ‘shoppertainment,’‘shoppertainment,’ begins in the begins in the

parking lot and goes on to parking lot and goes on to 1,6001,600 cheeses and cheeses and

1,4001,400 varieties of hot sauce—not to mention 12,000 wines varieties of hot sauce—not to mention 12,000 wines

priced from priced from

$8-$$8-$8,0008,000 a bottle; all this is brought to you a bottle; all this is brought to you

by by 4,0004,000 vendors. Customers from every corner of the vendors. Customers from every corner of the

globe.”globe.”

BRONNER’S CHRISTMAS WONDERLAND, FRANKENMUTH, MIBRONNER’S CHRISTMAS WONDERLAND, FRANKENMUTH, MI, POP , POP

5,0005,000:: 98,000-square-foot “shop” features 98,000-square-foot “shop” features 6,0006,000

Christmas ornaments, Christmas ornaments, 50,00050,000 trims, and anythingtrims, and anything else else

you can name pertaining to Christmas. …”you can name pertaining to Christmas. …”

Incredible. I give this book to Incredible. I give this book to accountants and lawyers and anyone I accountants and lawyers and anyone I can buttonhole. It amount to 25 acts of can buttonhole. It amount to 25 acts of unparalleled imagination—that define unparalleled imagination—that define excellence and differentiation. (In, often excellence and differentiation. (In, often as not, out of the way corners of the as not, out of the way corners of the world—or, at least, the USA.)world—or, at least, the USA.)

I repeat: I repeat: I LOVE THESE I LOVE THESE FOLKS. FOLKS.

I love …I love … Middle-Middle-sized Niche- sized Niche- Micro-niche Micro-niche

Dominators!Dominators!

"Own" a niche through EXCELLENCE"Own" a niche through EXCELLENCE!!(Writ large: Germany’s MITTELSTAND)(Writ large: Germany’s MITTELSTAND)

Forget the giants. (More or less.) Forget the giants. (More or less.) Economic excellence is largely built more Economic excellence is largely built more upon a hearty base of middle-sized upon a hearty base of middle-sized superstars. Such a group, called the superstars. Such a group, called the Mittelstand, are the source of Germany’s Mittelstand, are the source of Germany’s astounding/ sustaining export astounding/ sustaining export excellence. (Until recently, the world’s excellence. (Until recently, the world’s #1 exporter.)#1 exporter.)

MITTELSTANDMITTELSTAND**

**“agile creatures darting between the “agile creatures darting between the

legs of the multinational monsters”legs of the multinational monsters” ((Bloomberg Bloomberg

BusinessWeekBusinessWeek))

Michael Raynor and Mumtaz Ahmed’: Michael Raynor and Mumtaz Ahmed’: THE THREE RULES: THE THREE RULES: How Exceptional Companies Think*How Exceptional Companies Think*::

1. 1. Better before cheaper.Better before cheaper.2. 2. Revenue before cost.Revenue before cost.3. 3. There are no other rules.There are no other rules.(*From a database of over 25,000 companies from hundreds of industries covering 45 years, they uncovered (*From a database of over 25,000 companies from hundreds of industries covering 45 years, they uncovered 344 companies that qualified as statistically “exceptional.”)344 companies that qualified as statistically “exceptional.”)

Jeff Colvin, Jeff Colvin, FortuneFortune: “The Economy Is Scary … But Smart : “The Economy Is Scary … But Smart Companies Can Dominate”:Companies Can Dominate”:

They manage for value—not for EPS.They manage for value—not for EPS.They keep developing human capital.They keep developing human capital.They get radically customer-centric.They get radically customer-centric.

These mid-size superstars typically play These mid-size superstars typically play the value added game to the hilt.the value added game to the hilt.

“‘“‘Commodity’ is a Commodity’ is a state of mind. state of mind.

ANYTHINGANYTHING can be can be DRAMATICALLYDRAMATICALLY differentiated.”differentiated.”

Small Giants: Companies that Chose to Be Great Instead of Big (Bo Burlingham)

““THEY CULTIVATED THEY CULTIVATED EXCEPTIONALLY INTIMATE EXCEPTIONALLY INTIMATE RELATIONSHIPS WITH CUSTOMERS AND SUPPLIERSRELATIONSHIPS WITH CUSTOMERS AND SUPPLIERS, , based based on personal contact, one-on-one interaction, and mutual on personal contact, one-on-one interaction, and mutual commitment to delivering on promises.commitment to delivering on promises.

“EACH COMPANY HAD AN ACH COMPANY HAD AN EXTRAORDINARILY INTIMATE EXTRAORDINARILY INTIMATE RELATIONSHIP WITH THE LOCAL CITY, TOWN, OR COUNTYRELATIONSHIP WITH THE LOCAL CITY, TOWN, OR COUNTY in in which it did business—a relationship that went well beyond which it did business—a relationship that went well beyond the usual concept of ‘giving back.’ the usual concept of ‘giving back.’

““The companies had what struck me asThe companies had what struck me as UNUSUALLY UNUSUALLY INTIMATE WORKPLACESINTIMATE WORKPLACES..

““I noticed theI noticed the PASSIONPASSION that the leaders brought to what the that the leaders brought to what the company did.company did. THEY LOVED THE SUBJECT MATTERTHEY LOVED THE SUBJECT MATTER, , whether it whether it be music, safety lighting, food, special effects, constant be music, safety lighting, food, special effects, constant torque hinges, beer, records storage, construction, dining, torque hinges, beer, records storage, construction, dining, or fashion."or fashion."

Small GiantsSmall Giants is a stellar book with stellar is a stellar book with stellar case studies. Big message: There are case studies. Big message: There are paths to greatness other than an paths to greatness other than an obsession with growth. In fact, growth-obsession with growth. In fact, growth-for-growth’s-sake is usually a loser’s for-growth’s-sake is usually a loser’s game.game.

Where the +201,000 new private-sectorWhere the +201,000 new private-sector jobs came from … jobs came from …

51% Small firms51% Small firms41% Medium-sized41% Medium-sized**8% Big8% BigSource: ADP National Employment Report/March 2011Source: ADP National Employment Report/March 2011

*E.g., German *E.g., German MITTELSTANDMITTELSTAND

Read it twice.Read it twice.

WHITE-COLLAR SURVIVAL STRATEGY #1: WHITE-COLLAR SURVIVAL STRATEGY #1: Department as Small/Department as Small/

EntreEntreppreneurialreneurial BUSINESS BUSINESS

Training Inc.Training Inc., a 14-person , a 14-person unit* in a 50-person HR unit* in a 50-person HR department in a $200M department in a $200M business unit in a $3B business unit in a $3B

corporation—aiming for corporation—aiming for Excellence & WOW!Excellence & WOW!

**PSFPSF// Professional Service Firm (See my …Professional Service Firm (See my …

Professional Service Firm 50: Fifty Ways to Transform Your “Department” Professional Service Firm 50: Fifty Ways to Transform Your “Department” Into A Professional Service Firm Whose Trademarks Are Passion and Into A Professional Service Firm Whose Trademarks Are Passion and

Innovation.Innovation.))

Think back to the discussion of the extraordinary Think back to the discussion of the extraordinary technology change engulfing us—and, now, its likely technology change engulfing us—and, now, its likely impact on high-end white collar jobs. I believe there is impact on high-end white collar jobs. I believe there is an escape path, a route to not only survival, but an escape path, a route to not only survival, but flourishing. flourishing.

I 1I 1stst wrote about it in my 1999 book, wrote about it in my 1999 book, Professional Professional Service Firm 50: Fifty Ways to Transform Your Service Firm 50: Fifty Ways to Transform Your “Department” Into A Professional Service Firm Whose “Department” Into A Professional Service Firm Whose Trademarks Are Passion and InnovationTrademarks Are Passion and Innovation. The idea: . The idea: CONVERT EVERY “DEPARTMENT”/ “UNIT” CONVERT EVERY “DEPARTMENT”/ “UNIT” [and yourself][and yourself] INTO A FULL-FLEDGED … “PSF”/ PROFESSIONAL INTO A FULL-FLEDGED … “PSF”/ PROFESSIONAL SERVICE FIRM … WHOLLY DEDICATED TO EXCELLENCE & SERVICE FIRM … WHOLLY DEDICATED TO EXCELLENCE & WOW & ADDING SKYSCRAPING VALUE TO THEIR WOW & ADDING SKYSCRAPING VALUE TO THEIR CUSTOMERS’ CUSTOMERS’ [usually internal customers][usually internal customers] ACTIVITIES. ACTIVITIES.

Muhammad Yunus: Muhammad Yunus: ““All human All human beinbeinggs are s are

entreentreppreneursreneurs.. When we When we

were in the caves we were all self-were in the caves we were all self-employed . . . finding our food, feeding employed . . . finding our food, feeding ourselves. That’s where human history ourselves. That’s where human history

began . . . As civilization came we began . . . As civilization came we suppressed it. We became labor because suppressed it. We became labor because

they stamped us, ‘You are labor.’ they stamped us, ‘You are labor.’ We forgot that we are entrepreneurs.”We forgot that we are entrepreneurs.”

——Muhammad Yunus,Muhammad Yunus,

Nobel Laureate/The News Hour/PBS/1122.2006Nobel Laureate/The News Hour/PBS/1122.2006

An entrepreneurial flair is not limited to An entrepreneurial flair is not limited to a handful of Mark Zuckerbergs. As micro-a handful of Mark Zuckerbergs. As micro-lending guru and Nobel Laureate lending guru and Nobel Laureate Muhammad Yunus tells us, virtually all of Muhammad Yunus tells us, virtually all of us who have survived the Darwinian us who have survived the Darwinian sorting process find that some form of sorting process find that some form of entrepreneurial behavior comes entrepreneurial behavior comes naturally.naturally.

Distinct or Distinct or

extinct!extinct!

““I believe that ninety I believe that ninety percent of white-percent of white-

collar/“knowledge-work” collar/“knowledge-work” jobs (which are 80 percent jobs (which are 80 percent

of all jobs) in the U.S. will be of all jobs) in the U.S. will be either destroyed or altered either destroyed or altered beyond recognition in the beyond recognition in the

next 10 to 15 years.”next 10 to 15 years.”——Cover story/Cover story/TimeTime/22 May 2000/Tom Peters/22 May 2000/Tom Peters

Circa 2014:Circa 2014:

Brand YOU.Brand YOU.Fabulous at … something.Fabulous at … something.

STAND OUTSTAND OUT..

Or … Or … STAND DOWNSTAND DOWN..No other options.No other options.

““The average age of a The average age of a startup founder is 40. startup founder is 40. And And high-high-ggrowth starturowth startupps s are nearlare nearlyy twice as twice as

likellikelyy to be launched b to be launched byy ppeoeopple over 55 as ble over 55 as byy

ppeoeopplele 20-34 20-34.”.” —Vivek Wadhwa, Kauffman foundation (—Vivek Wadhwa, Kauffman foundation (TimeTime/0325.13)/0325.13)

Wow.Wow.

““The ecosystem used to The ecosystem used to funnel lots of talented funnel lots of talented people into a few clear people into a few clear

winners.winners. Now it’s Now it’s funnelinfunnelingg lots of lots of

talented talented ppeoeopple into le into lots of exlots of expperimentseriments.”.”

——Tyler Willis, business developer, to Nathan Heller in Tyler Willis, business developer, to Nathan Heller in “Bay Watched: “Bay Watched: How San Francisco’s New Entrepreneurial Culture Is How San Francisco’s New Entrepreneurial Culture Is

Changing the Country,”Changing the Country,” The New YorkerThe New Yorker, 1014.13, 1014.13

““The growth and The growth and success of women-success of women-

owned businesses is owned businesses is one of the most one of the most

profound changes profound changes takingtaking place in the place in the

business world today.”business world today.” ——

Margaret Heffernan, Margaret Heffernan, How She Does ItHow She Does It

Under-attended lynchpin of the New Under-attended lynchpin of the New Entrepreneurial Age?!Entrepreneurial Age?!

U.S. firms owned or controlled by Women:U.S. firms owned or controlled by Women: 10.6 million (48% of all firms)10.6 million (48% of all firms)

Growth rate of Women-owned firms vs all Growth rate of Women-owned firms vs all firms:firms: 3X 3X

Rate of jobs created by Women-owned firms Rate of jobs created by Women-owned firms vs all firms:vs all firms: 2X 2X

Ratio of total payroll of Women-owned firms Ratio of total payroll of Women-owned firms vs total for Fortune 500 firms:vs total for Fortune 500 firms: >1.0 >1.0

Ratio of likelihood of Women-owned firms Ratio of likelihood of Women-owned firms staying in business vs all firms:staying in business vs all firms: >1.0 >1.0

Growth rate of Women-owned companies Growth rate of Women-owned companies with revenues of >$1,000,000 and >100 with revenues of >$1,000,000 and >100 employees vs all firms:employees vs all firms: 2X 2X

Source: Margaret Heffernan, How She Does It

Women-owned BizWomen-owned Biz

U.S. employees > U.S. employees > F500 employees F500 employees

worldwideworldwideSource: Martha Barletta, Source: Martha Barletta, Marketing to WomenMarketing to Women

Women-owned Start-upsWomen-owned Start-ups

424 per day424 per day2X men2X men

Source: Martha Barletta/TrendSight Group/0517.11Source: Martha Barletta/TrendSight Group/0517.11

LEADERSHIPLEADERSHIP

Not a “theory of leadership” by any Not a “theory of leadership” by any means. Just a few ideas to ponder—and, I means. Just a few ideas to ponder—and, I hope in some cases, implement.hope in some cases, implement.

25/5025/50

““I’m always stopping by our I’m always stopping by our

stores— stores— at least at least 2525

a weeka week.. I’m also in other I’m also in other

places: Home Depot, Whole Foods, Crate places: Home Depot, Whole Foods, Crate & Barrel. I try to be a sponge to pick up & Barrel. I try to be a sponge to pick up

as much as I can.”as much as I can.” —Howard Schultz—Howard Schultz

Source: Source: FortuneFortune, “Secrets of Greatness”, “Secrets of Greatness”

MBWAMBWA

MManaginganaging

BBy y

WWanderingandering

AAroundround

The MBWA idea—in touch management—The MBWA idea—in touch management—was the signature of was the signature of In Search of In Search of Excellence.Excellence.

““Most managers spend a great deal of time thinking about what they plan to do, but relatively little time thinking about 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 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 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.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 Let me put it bluntly: every leader should routinely keep a substantial should routinely keep a substantial

portion of his or her time—I would say portion of his or her time—I would say

as much asas much as 5050 percent—percent—

unscheduledunscheduled.. … Only when you have substantial ‘slop’ in your schedule—unscheduled time—will … 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. 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’ 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.’typical response to my argument about free time is, ‘That’s all well and good, but there are things I have to do.’ Yet Yet we waste so much time in unwe waste so much time in unpproductive activitroductive activity—y—it takes an it takes an

enormous effort on the enormous effort on the ppart of the leader to keeart of the leader to keepp free time for the free time for the trultrulyy im impportant thinortant thinggss.”.”

——Dov FrohmanDov Frohman (& Robert Howard (& Robert Howard), Leadership The Hard Way: Why Leadership Can’t Be Taught—), 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”)And How You Can Learn It Anyway (Chapter 5, “The Soft Skills Of Hard Leadership”)

Consider it.Consider it.(Seriously.)(Seriously.)

4, 8, 124, 8, 12

““The The 44 most most

important important wordswords in any in any

organization are …organization are …

THE FOUR MOST IMPORTANT WORDS IN ANY ORGANIZATIONTHE FOUR MOST IMPORTANT WORDS IN ANY ORGANIZATION

ARE …ARE … “WHAT “WHAT DO DO YOUYOU THINK?”THINK?”

Source: courtesy Dave Wheeler, posted at tompeters.com Source: courtesy Dave Wheeler, posted at tompeters.com

TomorrowTomorrow: How : How many times will you many times will you

“ask the WDYT “ask the WDYT question”question”??

(Count ’em!!) (Practice makes (Practice makes

better!) better!)

(This is a(This is a STRATEGIC skill!)skill!)

MBWA MBWA 88: :

Change the World With EIGHT Change the World With EIGHT WordsWords

What do you think?*What do you think?*How can I help?**How can I help?**

*Dave Wheeler: “What are the four most important words in the boss’ lexicon?”*Dave Wheeler: “What are the four most important words in the boss’ lexicon?”**Boss as CHRO/Chief Hurdle Removal Officer **Boss as CHRO/Chief Hurdle Removal Officer ********************************************************************

Are you a full-fledged “professional” when it

comes to helping?

Helping: (Helping: (MUCHMUCH) easier said than ) easier said than done!done!(I.e., a formal skill to be studied and (I.e., a formal skill to be studied and practiced.)practiced.)

What do managers What do managers dodo for a living? for a living?

Help!Help!Right?Right?

How many of us could call ourselves How many of us could call ourselves “professional helpers,”“professional helpers,” meaning that we have meaning that we have studied—like a professional mastering her musical craft—“helping”? (Not many, I’d studied—like a professional mastering her musical craft—“helping”? (Not many, I’d judge.)judge.)

Ed Schein:Ed Schein: Helping: How to Offer, Give, and Receive HelpHelping: How to Offer, Give, and Receive Help

Last chapter: 7 “principles.” E.g.:Last chapter: 7 “principles.” E.g.:

PRINCIPLE 2:PRINCIPLE 2: “Effective Help Occurs When the Helping Relationship Is“Effective Help Occurs When the Helping Relationship Is Perceived to Be Equitable.Perceived to Be Equitable.PRINCIPLE 4:PRINCIPLE 4: “Everything You Say or Do Is an Intervention that “Everything You Say or Do Is an Intervention that Determines the Future of the Relationship.Determines the Future of the Relationship.PRINCIPLE 5:PRINCIPLE 5: “Effective Helping Begins with Pure Inquiry.“Effective Helping Begins with Pure Inquiry.PRINCIPLE 6:PRINCIPLE 6: “It Is the Client Who Owns the Problem.”*“It Is the Client Who Owns the Problem.”*

(Words matter!! Read a quote from NFL player-turned lawyer-turned professional football coach, (Words matter!! Read a quote from NFL player-turned lawyer-turned professional football coach,

calling his players “my clients.” calling his players “my clients.” (*Love the idea that the employee is a “Client” !(*Love the idea that the employee is a “Client” ! ))

EmEmpploloyyee as Clientee as Client! ! ““HelHelpping” is what we (leaders) “do” for a livining” is what we (leaders) “do” for a living!g!STUDY/PRACTICE “helSTUDY/PRACTICE “helppiningg” as ” as yyou would neurosurgerou would neurosurgery!y!

(“(“Helping” Helping” isis yyour neurosurgerour neurosurgery!)y!)

Some Help With Helping …Some Help With Helping …

Help works when the recipient subsequently feelsHelp works when the recipient subsequently feels smarter—not dumber.smarter—not dumber.

Regularly help too soon—and you will set up expectation of Regularly help too soon—and you will set up expectation of inaction until your "help" is provided.inaction until your "help" is provided.

Help poorly conveyed spawns powerlessnessHelp poorly conveyed spawns powerlessness and resentment in recipient.and resentment in recipient.

Helping requires a sniper's rifle or surgeon'sHelping requires a sniper's rifle or surgeon's scalpel—not a shotgun or machete.scalpel—not a shotgun or machete.

Helping strategies vary (significantly) from individual to Helping strategies vary (significantly) from individual to individual—leave the “cookie cutter” at home.individual—leave the “cookie cutter” at home.

Effectively "helping" may be the most difficultEffectively "helping" may be the most difficult leadership task of all!leadership task of all!

"Help" is only truly successful when the recipient"Help" is only truly successful when the recipient says, and believes: "I did it myself!"says, and believes: "I did it myself!"

Near truism: Nobody wants help. But we wouldNear truism: Nobody wants help. But we would all like to have received help.all like to have received help.

Guitarist Robert Fripp: Guitarist Robert Fripp: "Don't be helpful. Be available. "Don't be helpful. Be available. Helpful people are a nuisance."Helpful people are a nuisance."

MBWA MBWA 1212: :

Change the WorldChange the World With TWELVE Words With TWELVE Words

What do you think?*What do you think?*How can I help?**How can I help?**

What have you learned?***What have you learned?***

*Dave Wheeler: “What are the four most important words in the boss’ lexicon?”*Dave Wheeler: “What are the four most important words in the boss’ lexicon?”**Boss as CHRO/Chief Hurdle Removal Officer **Boss as CHRO/Chief Hurdle Removal Officer ********************************************************************

***What (new thing) have you learned (in the last 24 hours)? ***What (new thing) have you learned (in the last 24 hours)? ********************* * ********************* *

AcknowledgementAcknowledgement!!

AcknowledgementAcknowledgement!!

I like the second title slide better than I like the second title slide better than the first.the first.

““The deepest principle The deepest principle in human nature is the in human nature is the

cravingcraving** to be to be appreciated.”appreciated.”

—William James—William James

**“Craving,” not “wish” or “desire” or “longing”/Dale “Craving,” not “wish” or “desire” or “longing”/Dale Carnegie, Carnegie, How to Win Friends and Influence People How to Win Friends and Influence People

(“The BIG Secret of Dealing With People”)(“The BIG Secret of Dealing With People”)

““The deepest The deepest urgeurge

in human nature in human nature is the desire to is the desire to

be important.”be important.” —John —John

DeweyDewey(In Dale Carnegie, (In Dale Carnegie, How to Win Friends and Influence How to Win Friends and Influence

People People (“The BIG Secret of Dealing With People”)(“The BIG Secret of Dealing With People”)

"Appreciative words are "Appreciative words are the most powerful forcethe most powerful force

for good on earth.”for good on earth.”——George W. Crane, physician, columnistGeorge W. Crane, physician, columnist

““The two most powerful The two most powerful things in existence: athings in existence: a

kind word and akind word and a thoughtful gesture.” thoughtful gesture.”

——Ken Langone, co-founder, Home DepotKen Langone, co-founder, Home Depot

““AcknowledAcknowledggee” … ” … perhaps the most perhaps the most

powerful word (and powerful word (and idea) in the English idea) in the English

language—and language—and manager’s tool kit!manager’s tool kit!

““Employees who Employees who don't feel significant don't feel significant

rarely make rarely make significant significant

contributions.”contributions.” —Mark Sanborn—Mark Sanborn

““PeoPeopple want to be le want to be ppartart of somethinof somethingg lar largger than er than

themselvesthemselves.. They want They want to be part of something to be part of something

they’re really they’re really pproudroud of, that of, that they’ll they’ll fifigghtht forfor,, sacrificesacrifice forfor,, trusttrust.”.” —Howard Schultz, Starbucks

11

““If there is any If there is any ONEONE ‘secret’ ‘secret’

to effectiveness, it is concentration. to effectiveness, it is concentration. Effective executives do first things first Effective executives do first things first

… … and they do and they do

ONEONE thing at a thing at a time.”time.” —Peter Drucker—Peter Drucker

You = Your You = Your calendarcalendar**

*The calendar *The calendar NEVERNEVER lies.lies.

Your priorities are revealed in your Your priorities are revealed in your allocation of time.allocation of time.

PERIOD.PERIOD.

Meetings ROCKMeetings ROCK!!(Make that: SHOULD Rock)(Make that: SHOULD Rock)

Bitch all you Bitch all you want, but want, but meetinmeetinggss

are what you are what you (boss/leader)(boss/leader) dodo!!

Meetings are Meetings are #1#1 thing thing

bosses bosses dodo. Therefore, . Therefore, 100%100%

of those meetings:of those meetings: EXCELLENCE. EXCELLENCE. ENTHUSIASM. ENTHUSIASM. ENGAGEMENT. ENGAGEMENT.

LEARNING. TEMPO. LEARNING. TEMPO. WORK-OF-ARTWORK-OF-ART.. DAMNDAMN ITIT..

Meetings are what bosses do. Meetings are what bosses do. GET OVER IT.GET OVER IT. Hence it is the bosses job-opportunity to Hence it is the bosses job-opportunity to make these meetings no less than … make these meetings no less than … paragons of excellence. paragons of excellence.

No kidding.No kidding.Think about it.Think about it.PLEASE.PLEASE.

Prepare for a Prepare for a meeting/every meeting/every

meeting as if your meeting as if your professional life and professional life and

legacy depended on it.legacy depended on it.

It does.It does.

#1#1 CEOCEO Failing?Failing?

““If I had toIf I had to pick one failing pick one failing

of CEOs, it’sof CEOs, it’s that …that …

——Co-founder of one of the largest investment services firms in the USA/worldCo-founder of one of the largest investment services firms in the USA/world

“If I had to pick one failing of

CEOs, it’s that … they don’t read enough.”

Wow.Wow.AND: Well worth considering.AND: Well worth considering.(I.e., pause and reflect on this. (I.e., pause and reflect on this. PLEASEPLEASE.).)

“In my whole life, I have known no In my whole life, I have known no wise people (over a broad subject wise people (over a broad subject matter area) who didn’t read all matter area) who didn’t read all

the time — none. the time — none.

Zero. You’d be You’d be

amazed at how much Warren amazed at how much Warren [Buffett] reads — and how much I [Buffett] reads — and how much I

read.” read.” —Charlie Munger (Berkshire Hathaway)—Charlie Munger (Berkshire Hathaway)

1818

““The doctor The doctor interruptsinterrupts after …*after …*

*Source: Jerome Groopman, *Source: Jerome Groopman, How Doctors ThinkHow Doctors Think

18 …18 …

18 … 18 … secondsseconds!!

AND … I’d bet (a pretty penny) that the AND … I’d bet (a pretty penny) that the average manager would achieve about average manager would achieve about the same score.the same score.

(An (An obsessionobsession with) Listening is ... the ultimate mark with) Listening is ... the ultimate mark

of of RespectRespect..

Listening is ... the heart and soul of Listening is ... the heart and soul of EngagementEngagement..Listening is ... the heart and soul of Listening is ... the heart and soul of KindnessKindness..Listening is ... the heart and soul of Listening is ... the heart and soul of ThoughtfulnessThoughtfulness..Listening is ... the basis for true Listening is ... the basis for true CollaborationCollaboration..Listening is ... the basis for true Listening is ... the basis for true PartnershipPartnership..Listening is ... a Listening is ... a Team SportTeam Sport..Listening is ... a Listening is ... a Developable Individual SkillDevelopable Individual Skill.* .* (*Though women (*Though women are are farfar better at it than men.) better at it than men.)

Listening is ... the basis forListening is ... the basis for CommunityCommunity..Listening is ... the bedrock of Listening is ... the bedrock of Joint Ventures that workJoint Ventures that work..Listening is ... the bedrock of Listening is ... the bedrock of Joint Ventures thatJoint Ventures that growgrow..Listening is ... the core of Listening is ... the core of effective Cross-functional effective Cross-functional CommunicationCommunication* * (*Which is in turn Attribute #1 of (*Which is in turn Attribute #1 of organization effectiveness.)organization effectiveness.)

(cont.)(cont.)

Listening is ... the engine of Listening is ... the engine of superior superior EXECUTIONEXECUTION..Listening is ... the key to Listening is ... the key to making the making the SaleSale..Listening is ... the key to Listening is ... the key to Keeping the Customer’s BusinessKeeping the Customer’s Business..Listening is ... Listening is ... ServiceService..Listening is ... the engine of Listening is ... the engine of Network developmentNetwork development..Listening is ... the engine of Listening is ... the engine of Network maintenanceNetwork maintenance..Listening is ... the engine of Listening is ... the engine of Network expansionNetwork expansion..Listening is ... Listening is ... Social Networking’s “secret weapon.”Social Networking’s “secret weapon.”Listening is ... Listening is ... LearningLearning..Listening is ... the Listening is ... the sine qua non of sine qua non of RenewalRenewal..Listening is ... the Listening is ... the sine qua non of sine qua non of CreativityCreativity..Listening is ... the Listening is ... the sine qua non of sine qua non of InnovationInnovation..Listening is ... the core of Listening is ... the core of taking diverse opinions aboardtaking diverse opinions aboard..Listening is ... Listening is ... StrategyStrategy..Listening is ... Listening is ... Source #1 of “Value-addedSource #1 of “Value-added.”.”Listening is ... Listening is ... Differentiator #1Differentiator #1..Listening is ... Listening is ... ProfitableProfitable.*.* (*The “R.O.I.” from listening is higher than(*The “R.O.I.” from listening is higher than from any other single activity.)from any other single activity.)

Listening is … the bedrock which underpins a Listening is … the bedrock which underpins a Commitment toCommitment to EXCELLENCEEXCELLENCE

Best Listeners Win …Best Listeners Win …

““IF YOU DON’T IF YOU DON’T LISTEN, YOU LISTEN, YOU DON’T SELL DON’T SELL ANYTHING.”ANYTHING.”

——Carolyn MarlandCarolyn Marland

*8 of 10 sales presentations fail*8 of 10 sales presentations fail

*50% failed sales *50% failed sales

presentations … presentations … talkingtalking “at” before “at” before listening! listening!—Susan Scott, “Let Silence Do the Heavy Lifting,” chapter title, —Susan Scott, “Let Silence Do the Heavy Lifting,” chapter title, Fierce Conversations: Achieving Success at Work and in Life,Fierce Conversations: Achieving Success at Work and in Life,One Conversation at a TimeOne Conversation at a Time

Trevor Gay: Trevor Gay: “I once had a boss who “I once had a boss who

regularly asked me,regularly asked me, ‘Have ‘Have you given your you given your team a good team a good

listeninglistening to lately?’to lately?’ ” ”

IfIf you agree with the above, shouldn’t listening be ... a Core you agree with the above, shouldn’t listening be ... a Core

Value?Value?If you agree with the above, shouldn’t listening be ... perhaps If you agree with the above, shouldn’t listening be ... perhaps Core Value #1?* Core Value #1?* (*“We are Effective Listeners—we treat (*“We are Effective Listeners—we treat Listening EXCELLENCE as the Centerpiece of our Commitment Listening EXCELLENCE as the Centerpiece of our Commitment to Respect and Engagement and Community and Growth.”)to Respect and Engagement and Community and Growth.”)If you agree, shouldn’t listening be ... a Core Competence?If you agree, shouldn’t listening be ... a Core Competence?If you agree, shouldn’t listening be ... Core Competence #1?If you agree, shouldn’t listening be ... Core Competence #1?If you agree, shouldn’t listening be ... an explicit “agenda item” If you agree, shouldn’t listening be ... an explicit “agenda item” at every Meeting?at every Meeting?If you agree, shouldn’t listening be ... our Strategy—per se? If you agree, shouldn’t listening be ... our Strategy—per se? (Listening = Strategy.)(Listening = Strategy.)If you agree, shouldn’t listening be ... the #1 skill we look for in If you agree, shouldn’t listening be ... the #1 skill we look for in Hiring (for every job)?Hiring (for every job)?

IfIf you agree, shouldn’t listening be ... the #1 attribute we you agree, shouldn’t listening be ... the #1 attribute we

examine in our Evaluations?examine in our Evaluations?If you agree, shouldn’t listening be ... the #1 skill we look for If you agree, shouldn’t listening be ... the #1 skill we look for in Promotion decisions?in Promotion decisions?If you agree, shouldn’t listening be ... the #1 Training priority If you agree, shouldn’t listening be ... the #1 Training priority at every stage of everyone’s career—from Day #1 to Day at every stage of everyone’s career—from Day #1 to Day LAST?LAST?If you agree, what are you going to do about it ... If you agree, what are you going to do about it ... in the next in the next 30 MINUTES?30 MINUTES?If you agree, what are you going to do about it ... If you agree, what are you going to do about it ... at your at your NEXT meeting?NEXT meeting?If you agree, what are you going to do about it ... If you agree, what are you going to do about it ... by the end by the end of the DAY?of the DAY?If you agree, what are you going to do about it ... If you agree, what are you going to do about it ... in the next in the next 30 DAYS?30 DAYS?If you agree, what are you going to do about it ... If you agree, what are you going to do about it ... in the next in the next 12 MONTHS?12 MONTHS?

Suggested Suggested Core Value Core Value #1:#1: “We are Effective “We are Effective

Listeners—we treat Listening Listeners—we treat Listening EXCELLENCEEXCELLENCE as the as the Centerpiece of our Centerpiece of our

Commitment to Respect and Commitment to Respect and Engagement and Community Engagement and Community

and Growth.”and Growth.”

#1#1

LISTEN = “PROFESSION” =

STUDY = PRACTICE = EVALUATION =

ENTERPRISE VALUE

Listening can be Listening can be studiedstudied and and

practicedpracticed to the same extent and to the same extent and in the same fashion as learning to play in the same fashion as learning to play the piano or cello.the piano or cello.

Ear Muscle Ear Muscle Exercise =Exercise =

H-A-R-D Work H-A-R-D Work!!

If you ain't exhausted If you ain't exhausted (after a serious (after a serious

conversation), then you conversation), then you weren't really listening.*weren't really listening.*

(*That is not a throwaway line.)(*That is not a throwaway line.)

Really listening is literally the Really listening is literally the most exhausting activity I most exhausting activity I

know—that includes vigorous know—that includes vigorous physical activities.physical activities.

““I always writeI always write ‘LISTEN’‘LISTEN’ on on the back of my hand the back of my hand before a meeting.”before a meeting.”

Source: Tweet viewed @tom_petersSource: Tweet viewed @tom_peters

33

““I regardI regard aappoloologgizinizing g as the as the most magical, healing, most magical, healing,

restorative gesture human restorative gesture human beings can make. It is thebeings can make. It is the

centercenterppieceiece of my of my work with executives who work with executives who

want to get better.”want to get better.”

——Marshall GoldsmithMarshall Goldsmith, What Got You Here Won’t Get You There: , What Got You Here Won’t Get You There: How Successful People Become Even More Successful. How Successful People Become Even More Successful.

““Centerpiece” is a mouthful. Centerpiece” is a mouthful. (And Goldsmith has few if any peers as (And Goldsmith has few if any peers as an executive coach. Hence: Take heed.)an executive coach. Hence: Take heed.)

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

THREETHREE--MINUTEMINUTE PHONEPHONE CALLCALL WOULD WOULD

HAVE AVOIDED SETTING OFF THE HAVE AVOIDED SETTING OFF THE DOWNWARD SPIRAL THAT DOWNWARD SPIRAL THAT RESULTED IN A COMPLETE RESULTED IN A COMPLETE

RUPTURE.RUPTURE.**

*Divorce, loss of a BILLION $$$ aircraft sale, etc., etc.*Divorce, loss of a BILLION $$$ aircraft sale, etc., etc.

I call this an … I call this an … “IRON LAW.”“IRON LAW.”

THE PROBLEM IS THE PROBLEM IS RARELY/RARELY/NEVERNEVER THE THE

PROBLEM. THEPROBLEM. THE

RESPONSERESPONSE TO THE TO THE PROBLEM INVARIABLY PROBLEM INVARIABLY ENDS UP BEING THE ENDS UP BEING THE

REAL PROBLEM.REAL PROBLEM.(OPPORTUNITY)(OPPORTUNITY).

Step Up ToStep Up ToCreating/Creating/

Living/Living/Maintaining anMaintaining an

Effective CultureEffective Culture

WSJ/0910.13:WSJ/0910.13: “What matters most “What matters most to a company over time? to a company over time?

Strategy or culture? Strategy or culture?

Dominic Barton, MD, McKinsey & Co.:Dominic Barton, MD, McKinsey & Co.:

“Culture.“Culture.””

Developing and maintaining an effective Developing and maintaining an effective culture is a hard-nosed task, anything culture is a hard-nosed task, anything but ephemeral, and is … but ephemeral, and is … LEADER JOB LEADER JOB ONEONE..

““If I could have chosen not to tackle the IBM culture head-If I could have chosen not to tackle the IBM culture head-on,on,

I probably wouldn’t have. My bias coming in was toward I probably wouldn’t have. My bias coming in was toward strategy, analysis and measurement. In comparison, strategy, analysis and measurement. In comparison, changing the attitude and behaviors of hundreds of changing the attitude and behaviors of hundreds of

thousands of people is very, very hard.thousands of people is very, very hard. Yet I Yet I came to see in my time at came to see in my time at IBM that IBM that cultureculture isn’t just isn’t just

one aspect of the game one aspect of the game ——IT IS THE IT IS THE GGAMEAME.”.”

——Lou Gerstner, Lou Gerstner, Who Says Elephants Can’t DanceWho Says Elephants Can’t Dance

As Mr. Analysis, Lou Gerstner, says in no As Mr. Analysis, Lou Gerstner, says in no

uncertain terms: uncertain terms: Culture Culture issues issues mustmust be be squarely addressed.squarely addressed.

““It may sound radical, unconventional, and It may sound radical, unconventional, and bordering on being a crazy business idea. bordering on being a crazy business idea. However— as ridiculous as it sounds—joy is However— as ridiculous as it sounds—joy is

the core belief of our workplace. the core belief of our workplace.

JoyJoy is the reason my company, is the reason my company,

Menlo Innovations, a customer software Menlo Innovations, a customer software design and development firm in Ann Arbor, design and development firm in Ann Arbor,

exists. It defines what we do and how we do it. exists. It defines what we do and how we do it. It is the single shared belief of our entire It is the single shared belief of our entire

team.”team.”

——Richard Sheridan, Richard Sheridan, Joy, Inc.: Joy, Inc.: How We Built a Workplace People LoveHow We Built a Workplace People Love

Three hearty Three hearty

cheerscheers!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!Why notWhy not????????????????(Think about it.)(Think about it.)

Hard is Soft.Hard is Soft.Soft is Hard.Soft is Hard.

The “hard stuff”—numbers, plans—are in The “hard stuff”—numbers, plans—are in fact the flimsy (soft) bits. The “soft fact the flimsy (soft) bits. The “soft stuff”—relationships, people practices, stuff”—relationships, people practices, culture—are the bedrock (hard). That was culture—are the bedrock (hard). That was the core belief animating the core belief animating In Search of In Search of ExcellenceExcellence. .

The Moral The Moral Imperative Imperative

ReduxRedux

CORPORATE MANDATE #1 2014:CORPORATE MANDATE #1 2014: Your Your principal moral obligation as a principal moral obligation as a

leader is to develop the skillset, leader is to develop the skillset, “soft” and “hard,” of every one “soft” and “hard,” of every one

of the people in your charge of the people in your charge (temporary as well as semi-(temporary as well as semi-permanent) to the maximum permanent) to the maximum

extent of your abilities. The good extent of your abilities. The good news: news: This is also theThis is also the

#1 mid- to lon#1 mid- to longg-term-term … … p profit maximization straterofit maximization strategy!gy!

A reminder.A reminder.

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

actors and actresses canactors and actresses can become more than become more than thetheyy’ve ever been ’ve ever been

before,before, more than themore than they’y’ve ve dreamed of beindreamed of being.”g.”

——Robert Altman, Oscar acceptance speechRobert Altman, Oscar acceptance speech

!!

0/8000/800

““Normal” =Normal” = “0 “0 forfor 800” 800”

*There are … *There are … ZEROZERO … “normal people” in the history books. … “normal people” in the history books.

We do not live in normal times.* We do not live in normal times.*

ACT ACCORDINGLY.ACT ACCORDINGLY.(That’s my advice.)(That’s my advice.)

(*As to the 800, an average high school history book is 400 (*As to the 800, an average high school history book is 400 pages long and averages two names per page. Hence, 800 pages long and averages two names per page. Hence, 800 remarkable people in total recognized.)remarkable people in total recognized.)

““INSANELY GREAT”INSANELY GREAT”STEVE JOBSSTEVE JOBS

“RADICALLY THRILLING” “RADICALLY THRILLING” BMW

High standards.High standards.(Why not?)(Why not?)

““Astonish me!”Astonish me!” (Sergei Diaghlev)

“Build something great!”“Build something great!” (Hiroshi Yamauchi)

“Make it immortal!”“Make it immortal!” (David Ogilvy).

Raise your sights!Raise your sights!Blaze new trails!Blaze new trails!Compete with the Compete with the

immortals!immortals! ——David Ogilvy, on Ogilvy & Mather’s corporate culture David Ogilvy, on Ogilvy & Mather’s corporate culture

““Let us create Let us create such a building such a building

that future that future generations will generations will

take us for take us for lunaticslunatics.”.” —the church hierarchs at Seville—the church hierarchs at Seville

““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’, something is ‘good’, it means someone it means someone

else is already doing else is already doing it.”it.”

—Hajime Mitarai, Canon—Hajime Mitarai, Canon

““You can’t behave You can’t behave in a calm, rational in a calm, rational manner. You’ve got manner. You’ve got to be out there on to be out there on the the lunaticlunatic frinfringgee.”.”

— Jack Welch— Jack Welch

““If I had any epitaph that I If I had any epitaph that I would rather have more than would rather have more than any other, it would be to say any other, it would be to say

that I hadthat I had … …disturbed disturbed the sleethe sleep p of mof my y ggenerationeneration.”.”

—Adlai Stevenson—Adlai Stevenson

““I WANT TO BE THOROUGHLY I WANT TO BE THOROUGHLY USED UP WHEN I DIE.USED UP WHEN I DIE. … Life is … Life is no ‘brief candle’ to me. It is a no ‘brief candle’ to me. It is a sort of splendid torch which I sort of splendid torch which I

have got hold of for the have got hold of for the moment, and I want to make it moment, and I want to make it

burn as brightly as possible burn as brightly as possible before handing it on to future before handing it on to future generations.” generations.” —George Bernard Shaw—George Bernard Shaw

““If you ask me what I If you ask me what I have come to do in have come to do in

this world, I who am this world, I who am an artist, I will reply: an artist, I will reply: I I

am here to live my am here to live my life out loud.”life out loud.” — Émile Zola— Émile Zola

““The reasonable man adapts The reasonable man adapts himself to the world; the himself to the world; the

unreasonable one persists in unreasonable one persists in trying to adapt the world to trying to adapt the world to

himself. Therefore all progress himself. Therefore all progress depends on the unreasonable depends on the unreasonable man.”man.” —G.B. Shaw,—G.B. Shaw, Man and Superman: The Revolutionist’s Man and Superman: The Revolutionist’s

HandbookHandbook

““Whenever anything is being Whenever anything is being accomplished, it is being done, I accomplished, it is being done, I have learned, by a monomaniac have learned, by a monomaniac

with a mission.”with a mission.” —Peter Drucker—Peter Drucker

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!!

Kevin Roberts is CEO of Saatchi & Saatchi Kevin Roberts is CEO of Saatchi & Saatchi Worldwide—and a good friend.Worldwide—and a good friend.

!

My company logo (in full).My company logo (in full).My personal aspiration.My personal aspiration.

Excellence.Excellence. Always. Always.

If notIf not Excellence,Excellence, what?what?

If notIf not ExcellenceExcellence now, when?now, when?

And, of course.And, of course.

This 77-year-old aims to do no less than This 77-year-old aims to do no less than change the world—beginning with change the world—beginning with changing dramatically changing the changing dramatically changing the culture of a 2,000+ year old institution.culture of a 2,000+ year old institution.(And you?)(And you?)

AppendixAppendixThe 34 The 34 BFOsBFOs**

*BFO/Blinding Flash of the Obvious*BFO/Blinding Flash of the Obvious

NOTE: In 1985, I gave a 2-day seminar to YPO members in Manhattan. As we moved to close, I asked for feedback. Early on, a chap by the name of Manny Garcia got up to speak—Manny, who became a pal, was one of Burger King’s top franchisees. He began, “I really didn’t hear anything new in the two days”—you could have heard my sharp intake of breath from the back row. He continued, “I’d add that this was probably the best seminar I’ve attended in my many years in business.” Huh? “I’d call it a ‘BLINDING FLASH OF THE OBVIOUS.’ We KNOW all these things—but time and again we fail to relentlessly practice them.” In retrospect, I consider Manny’s feedback to be the best I’ve ever gotten. There will be … GUARANTEED … nothing new in the slides in this set. We know putting people REALLY first translates into mid- to long-term growth and maximized profitability. SO WHY DON’T WE DO IT? We know … GREAT TRAINING … pays for itself 100 times over—in business just much as in sports and the arts. SO WHY DON’T WE DO IT? We know a simple “THANK YOU” is the greatest of all motivators. SO WHY DON’T WE DO IT? And on—and on—it goes.

Frankly, I am in a rotten mood. If I was preaching rocket science, and people didn’t “get it,” that’d be one thing. But each point in this section amounts to, beyond doubt, a, yes … BLINDING FLASH OF THE OBVIOUS.

Damn it! Let’s get a move on! It is indeed obvious, then … NO EXCUSES!

This Is the This Is the (OBVIOUS)(OBVIOUS) Stuff I Care About. Stuff I Care About.

This Is the This Is the (OBVIOUS)(OBVIOUS) Stuff, the Absence ofStuff, the Absence of

Which Sends Me Into a …Which Sends Me Into a …

BLIND RAGEBLIND RAGE..

Tom Peters/14 May 2014Tom Peters/14 May 2014

The 34 BFOsThe 34 BFOs**

*Blinding Flash(es) of the Obvious*Blinding Flash(es) of the Obvious

BFOBFO #1#1:: If you (RELIGIOUSLY) help people— If you (RELIGIOUSLY) help people—

EVERY SINGLE PERSON, JUNIOR OR EVERY SINGLE PERSON, JUNIOR OR SENIOR, LIFER OR TEMPSENIOR, LIFER OR TEMP—grow and —grow and reach/exceed their perceived potential, then reach/exceed their perceived potential, then they in turn will bust their individual and they in turn will bust their individual and collective butts to create great experiences for collective butts to create great experiences for Clients—and the “bottom line” will get fatter Clients—and the “bottom line” will get fatter and fatter and fatter. (ANYBODY LISTENING?) and fatter and fatter. (ANYBODY LISTENING?)

((PEOPLEPEOPLE FIRSTFIRST = = MAXIMIZEDMAXIMIZED PROFITABILITYPROFITABILITY. . PERIODPERIOD.) .) (ANYBODY LISTENING?)(ANYBODY LISTENING?) (FYI: (FYI: “People “People FIRST” message 10X more urgent than ever in FIRST” message 10X more urgent than ever in the high-engagement “AGE OF SOCIAL the high-engagement “AGE OF SOCIAL BUSINESS.”)BUSINESS.”)

BFO 2:BFO 2: ENABLING “ALL ENABLING “ALL HANDS” GROWTH/ PERSONAL HANDS” GROWTH/ PERSONAL DEVELOPMENT IS … LEADER DEVELOPMENT IS … LEADER

DUTY DUTY #1#1..

(And ALL good things flow there from.)(And ALL good things flow there from.)

BFO 3:BFO 3: The “CTO”/Chief Training Officer The “CTO”/Chief Training Officer

should (should (MUST!MUST! ) be on a par with the ) be on a par with the CFO/CMO. CFO/CMO.

TRAINING = TRAINING = INVESTMENT #1.INVESTMENT #1.

(8 of 10 CEOs see training as an “expense,” (8 of 10 CEOs see training as an “expense,” not an investment/prime asset booster.) not an investment/prime asset booster.) ( ( ““Our training courses are so good Our training courses are so good they make me want to giggle.” “Our they make me want to giggle.” “Our trainers are on the same pay scale as trainers are on the same pay scale as our engineers.”our engineers.” ) (In a 45-minute “tour ) (In a 45-minute “tour

d’horizon” of the enterprise: GUARANTEE 9 of d’horizon” of the enterprise: GUARANTEE 9 of 10 CEOs* [*10 of 10?] wouldn’t once mention 10 CEOs* [*10 of 10?] wouldn’t once mention

training. training. THAT = DISGRACE.)THAT = DISGRACE.)

BFO 4:BFO 4: OUT-READ ’EM. OUT-READ ’EM. AGE 17. AGE 77.AGE 17. AGE 77. 2014: READ & GROW … 2014: READ & GROW …

or wilt. or wilt. (One financial services superstar pegs CEO problem #1: “They (One financial services superstar pegs CEO problem #1: “They don’t read enough.”) STUDENTHOOOD (OBSESSION don’t read enough.”) STUDENTHOOOD (OBSESSION THEREWITH) (for ALL of us) FOR LIFE!THEREWITH) (for ALL of us) FOR LIFE!

BFO 5:BFO 5: Organizations one & all exist for ONE reason … Organizations one & all exist for ONE reason … TO TO BE OF SERVICE. BE OF SERVICE. PERIODPERIOD.. (And effective leaders in turn are … (And effective leaders in turn are …

SERVANT LEADERS. SERVANT LEADERS. PERIODPERIOD.).)

BFO 6:BFO 6: The … HEART OF THE MATTER (productivity, The … HEART OF THE MATTER (productivity, quality, service, you name it) … is the typically under-quality, service, you name it) … is the typically under-

attended … attended … FIRST-LINE BOSSFIRST-LINE BOSS.. (Your FULL (Your FULL

CADRE of 1st-line bosses is arguably … CADRE of 1st-line bosses is arguably … ASSET ASSET #1#1.) .)

BFO 7:BFO 7: WTTMSWWTTMSW. (Whoever Tries The Most . (Whoever Tries The Most Stuff Wins.) WTTMSASTMSUTFW. (Whoever Tries The Stuff Wins.) WTTMSASTMSUTFW. (Whoever Tries The Most Stuff And Screws The Most Stuff Up The Fastest Most Stuff And Screws The Most Stuff Up The Fastest Wins.) Practical translation #1: Winning through the Wins.) Practical translation #1: Winning through the Discipline of QUICK PROTOTYPES. Discipline of QUICK PROTOTYPES.

READY. FIRE. AIM.READY. FIRE. AIM. Winners:Winners:

““RELENTLESS EXPERIMENTATION.”RELENTLESS EXPERIMENTATION.”

““A Bias For Action”: A Bias For Action”: #1#1 Success Requisite in 1982. Success Requisite in 1982.

““A Bias For Action”: A Bias For Action”: #1#1 Success Requisite in 2014. Success Requisite in 2014.

..

BFO 8:BFO 8: “Fail faster. Succeed sooner.” “Fail faster. Succeed sooner.”

““FAIL. FORWARD. FAST.”FAIL. FORWARD. FAST.”““Fail. Fail again. Fail better.”Fail. Fail again. Fail better.”

““REWARD excellent failures. PUNISH REWARD excellent failures. PUNISH mediocre successes.”mediocre successes.”Book/Farson: “Whoever Makes The Most Mistakes Book/Farson: “Whoever Makes The Most Mistakes Wins.”Wins.”We do NOT “accept”/ “tolerate” failures. We do NOT “accept”/ “tolerate” failures.

WE CELEBRATE FAILURES.WE CELEBRATE FAILURES.

BFO 9:BFO 9:

Excellence is NOT an “aspiration.”Excellence is NOT an “aspiration.”Excellence IS the next 5 minutes.Excellence IS the next 5 minutes. (Or not.)(Or not.)

BFO 10:BFO 10: Enabling change Rule #1: It’s NOT NOT Enabling change Rule #1: It’s NOT NOT NOT about “vanquishing [‘ignorant’] foes.” It’s NOT about “vanquishing [‘ignorant’] foes.” It’s ALL ALL ALL about RELENTLESSLY seeking & ALL ALL ALL about RELENTLESSLY seeking &

recruiting & nurturing … recruiting & nurturing … ALLIESALLIES..

BFO 11: BFO 11: The Gospel of “SMALL WINS.”The Gospel of “SMALL WINS.” You You and your Allies cobbble together a skein of and your Allies cobbble together a skein of successful trials (“small wins”); momentum successful trials (“small wins”); momentum around this portfolio of demos more important around this portfolio of demos more important than any high-investment Big Victory. than any high-investment Big Victory.

(ALLLIES + SMALL WINS + (ALLLIES + SMALL WINS + MOMENTUM = UNSTOPPABLE.)MOMENTUM = UNSTOPPABLE.)

BFO 12:BFO 12: Year = 220 LUNCHES. Year = 220 LUNCHES. WASTE NOT ONEWASTE NOT ONE.. Cross-functional Cross-functional SNAFUs #1 problem for most orgs. Software … SNAFUs #1 problem for most orgs. Software … WILL NOT … fix it. ONLY … “Social Stuff” worksWILL NOT … fix it. ONLY … “Social Stuff” works—e.g., makin’ pals in other functions; LUNDH = —e.g., makin’ pals in other functions; LUNDH = Strategy #1. Strategy #1.

Goal: Goal: XFX/Cross-Functional XFX/Cross-Functional ExcellenceExcellence … or die trying. Requisite: … or die trying. Requisite: DAILY/RELENTLESS ATTENTION & ALL-HANDS-DAILY/RELENTLESS ATTENTION & ALL-HANDS-ALL-THE-TIME ENGAGEMENT.ALL-THE-TIME ENGAGEMENT.

BFO 13:BFO 13: In Search of Excellence In Search of Excellence in 6 words:in 6 words:

“Hard is soft. Soft is Hard.”“Hard is soft. Soft is Hard.” (E.g., Numbers are the “soft stuff”—witness the crash. (E.g., Numbers are the “soft stuff”—witness the crash. Solid relationships/ integrity/trust/teamwork = True Solid relationships/ integrity/trust/teamwork = True “hard stuff.”)“hard stuff.”)

Strategy is important.Strategy is important.Systems are important.Systems are important.

CULTURE is … CULTURE is … MOREMORE IMPORTANT. IMPORTANT.

(Serious change = Tackling the culture. PERIOD.)(Serious change = Tackling the culture. PERIOD.)(In his autobiography, even “Mr. Analysis,” Lou (In his autobiography, even “Mr. Analysis,” Lou Gerstner, IBM turnaround CEO, reluctantly Gerstner, IBM turnaround CEO, reluctantly acknowledged culture’s unequivocal primacy in the big-acknowledged culture’s unequivocal primacy in the big-change-game.)change-game.)

BFO 14:BFO 14: We Are What We Eat = We Are What We Eat = WE ARE WE ARE WHO WE HANG OUT WITH.WHO WE HANG OUT WITH. (“Hang out (“Hang out with ‘cool’ and thou shalt become more cool. with ‘cool’ and thou shalt become more cool. Hang out with ‘dull’ and thou shalt become Hang out with ‘dull’ and thou shalt become more dull.”) more dull.”) RELIGIOUSLY-CONSCIOUSLY MANAGE RELIGIOUSLY-CONSCIOUSLY MANAGE “HANG OUT.”“HANG OUT.” EVERY “hang out decision” EVERY “hang out decision” (employees/customers/ (employees/customers/ vendors/consultants/lunch mates/board vendors/consultants/lunch mates/board

composition/ locale/etc.) is a … composition/ locale/etc.) is a … STRATEGIC STRATEGIC INNOVATION DECISIONINNOVATION DECISION..(Diversity [ON ANY DIMENSION YOU CAN (Diversity [ON ANY DIMENSION YOU CAN NAME] an imperative in confusing times.)NAME] an imperative in confusing times.)

(Hire for … (Hire for … CURIOSITYCURIOSITY. EXPLICITLY.). EXPLICITLY.)

BFO 15:BFO 15: Apple market cap surpasses Exxon Mobil. Apple market cap surpasses Exxon Mobil.

Why? Why? D-E-S-I-G-ND-E-S-I-G-N. Are . Are YOUYOU obsessed by … obsessed by …

DESIGNDESIGN? (In? (In EVERYEVERY nook and cranny of nook and cranny of EVERYEVERY tiny or humongous enterprise—tiny or humongous enterprise—and in your own and in your own professional affairs.) professional affairs.) (DESIGN is an instinctive STATE OF (DESIGN is an instinctive STATE OF MIND as well as a set of practices.) (Less than MIND as well as a set of practices.) (Less than EXCELLENCE in functionality = Unacceptable.)EXCELLENCE in functionality = Unacceptable.)(Less than SUPER-COOL aesthetics = Unacceptable.) (Less than SUPER-COOL aesthetics = Unacceptable.)

BFO 16:BFO 16: LBT/TGR MULTIPLIER POWER.LBT/TGR MULTIPLIER POWER.

Ceaselessly seek the LBTs/ Ceaselessly seek the LBTs/ Little BIG ThingsLittle BIG Things. . ““Small stuff” … BIG Impact: Walmart increases (mere) Small stuff” … BIG Impact: Walmart increases (mere) shopping basket size, small appliance sales up 50%. shopping basket size, small appliance sales up 50%. Reducing TGWs/Things Gone Wrong invaluable. BUT … Reducing TGWs/Things Gone Wrong invaluable. BUT … put at least as much effort into remorselessly put at least as much effort into remorselessly

accumulating accumulating TGRs/THINGS GONE TGRs/THINGS GONE RIGHTRIGHT. . (E.g. Disney’s OBSESSION with a memorable Start & (E.g. Disney’s OBSESSION with a memorable Start & Finish courtesy … PARKING LOT EXCELLENCE.) Finish courtesy … PARKING LOT EXCELLENCE.)

BFO 17:BFO 17: WOMENWOMEN BUY EVERYTHING. BUY EVERYTHING. WOMENWOMEN ARE THE MOST EFFECTIVE LEADERS. ARE THE MOST EFFECTIVE LEADERS. WOMENWOMEN ARE THE MOST SUCCESSFUL ARE THE MOST SUCCESSFUL INVESTORS.INVESTORS. (Does your organization … UNMISTAKABLY … reflect (Does your organization … UNMISTAKABLY … reflect these immutable truths from stem to stern?) (these immutable truths from stem to stern?) (“This “This will be the women’s century.”will be the women’s century.” —Dilma Rousseff, —Dilma Rousseff, president of Brazil, opening address U.N. General president of Brazil, opening address U.N. General Assembly)Assembly)

BFO 18:BFO 18: KEEP ADDING VALUE. KEEP ADDING VALUE.

IBIBMM To I To IBBM: Machine dominance to Business M: Machine dominance to Business

Services dominance. UServices dominance. UPPS to UPS to UPSS: delivering : delivering Parcels to Managing Logistics Systems. Parcels to Managing Logistics Systems. (EVERYONE’s game: “Customer (EVERYONE’s game: “Customer SATISFACTION” to “Systemic customer SATISFACTION” to “Systemic customer SOLUTIONS”)SOLUTIONS”)

BFO 19:BFO 19: Forget B-I-G. (100% of biggies Forget B-I-G. (100% of biggies UNDER-perform long-term.) Instead UNDER-perform long-term.) Instead build national wealth around …build national wealth around …

“MITTELSTAND” companies—“MITTELSTAND” companies—MIDSIZE SUPERSTAR MIDSIZE SUPERSTAR NICHE-/MICRO-NICHE NICHE-/MICRO-NICHE DOMINATORSDOMINATORS —in ANY category you can —in ANY category you can name. (C.f., Germany’s Mittelstand worldbeaters--#1 name. (C.f., Germany’s Mittelstand worldbeaters--#1

global exporter for years.) (Battle cry: global exporter for years.) (Battle cry: “BE THE “BE THE BEST. IT’S THE ONLY MARKET THAT’S BEST. IT’S THE ONLY MARKET THAT’S NOT CROWDED.”NOT CROWDED.” WHYWHY ELSEELSE BOTHERBOTHER?)?)

(FYI: (FYI: ANYTHING/EVERYTHINGANYTHING/EVERYTHING subject to subject to

MIND-BOGGLING ADDED-VALUE/ MIND-BOGGLING ADDED-VALUE/ DIFFERENTIATIONDIFFERENTIATION. . (BANISH the word … “commodity.”)(BANISH the word … “commodity.”)

BFO 20:BFO 20: The problem is RARELY the problemThe problem is RARELY the problem. The . The lackluster RESPONSE to the problem is invariably the lackluster RESPONSE to the problem is invariably the real problem. Answer? Slavishly adhere to these two real problem. Answer? Slavishly adhere to these two

response commandments: response commandments: LIGHTENING-FAST LIGHTENING-FAST RESPONSE OVERKILL. UNEQUIVOCAL RESPONSE OVERKILL. UNEQUIVOCAL QUICK-TIME APOLOGY. QUICK-TIME APOLOGY.

BFO 21:BFO 21: What do people (MOST) desire—including thee What do people (MOST) desire—including thee

and me? and me? ACKNOWLEDGEMENTACKNOWLEDGEMENT. . So: Show your appreciation … BIG TIME/ALL THE TIME. So: Show your appreciation … BIG TIME/ALL THE TIME. (Track it … RELIGIOUSLY!) (“Acknowledgement” is … (Track it … RELIGIOUSLY!) (“Acknowledgement” is … THE MOST POWERFUL WORD IN THE LEADER’S THE MOST POWERFUL WORD IN THE LEADER’S VOCABULARY.)VOCABULARY.)

BFO 22:BFO 22: The two most powerful words in the English The two most powerful words in the English language are? language are?

No contest: No contest: “THANK YOU.”“THANK YOU.” (ACT ACCORDINGLY—e.g., OBSESSIVELY.)(ACT ACCORDINGLY—e.g., OBSESSIVELY.)

BFO 23:BFO 23: Have you done your Have you done your MBWAMBWA/ Managing By / Managing By Wandering Around … TODAY? If not, why not? (Hint: Wandering Around … TODAY? If not, why not? (Hint: There are … There are … ZEROZERO ACCEPTABLE EXCUSES.) ACCEPTABLE EXCUSES.)

BFO 24:BFO 24: Your CALENDAR knows your TRUE priorities. Your CALENDAR knows your TRUE priorities.Do YOU?Do YOU?

You … ARE … your calendar.You … ARE … your calendar.Your calendar … NEVER LIES.Your calendar … NEVER LIES.(Drucker: Best bosses do ONE thing at a Time)(Drucker: Best bosses do ONE thing at a Time)

BFO 25:BFO 25: What is the individual’s/organization’s #1 What is the individual’s/organization’s #1

enduring strategic asset? Easy: enduring strategic asset? Easy: ASSET #1ASSET #1 = = INDIVIDUAL AND COLLECTIVE EXCELLENCE AT … INDIVIDUAL AND COLLECTIVE EXCELLENCE AT …

L-I-S-T-E-N-I-N-G.L-I-S-T-E-N-I-N-G. (Listening can be … (Listening can be … TAUGHT. Listening PER SE is a … PROFESSION. Are YOU TAUGHT. Listening PER SE is a … PROFESSION. Are YOU a “stellar professional listener”? THINK ABOUT IT. a “stellar professional listener”? THINK ABOUT IT. PLEASE.)PLEASE.)

BFO 26:BFO 26: LEADERSHIP is not about ABSTRACTIONS.LEADERSHIP is not about ABSTRACTIONS.LEADERSHIP is about … MASTERING DISCREET SKILLS. LEADERSHIP is about … MASTERING DISCREET SKILLS. E.g.:E.g.:

““Aggressive ‘professional’ listener.”Aggressive ‘professional’ listener.”Meetings as leadership opportunity #1.Meetings as leadership opportunity #1.Creating a “civil society.”Creating a “civil society.”Expert at “helping.” (HelpingExpert at “helping.” (Helping “professional.”) “professional.”)Expert at holding productive conversations.Expert at holding productive conversations.Fanatic about clear communications.Fanatic about clear communications.Fanatic about training.Fanatic about training.Master of appreciation/acknowledgement.Master of appreciation/acknowledgement.Effective at apology.Effective at apology.Creating a culture of automatic helpfulness by all to all.Creating a culture of automatic helpfulness by all to all.Presentation excellence. Presentation excellence. Conscious master of body language.Conscious master of body language.Master of hiring. (Hiring Master of hiring. (Hiring “professional”)“professional”)Master of evaluating people.Master of evaluating people.Avid practitioner of MBWA/Managing By Wandering Around. Avid practitioner of MBWA/Managing By Wandering Around. Avid student of the process of influencing others per se. Avid student of the process of influencing others per se. Student of decision-making/devastating impact of irrational aspects thereof.Student of decision-making/devastating impact of irrational aspects thereof.Creating a no-nonsense execution culture.Creating a no-nonsense execution culture.Meticulous about employee development/100% of staff.Meticulous about employee development/100% of staff.Student of the power of “d”iversity (all flavors of difference).Student of the power of “d”iversity (all flavors of difference).Aggressive in pursuing gender balance.Aggressive in pursuing gender balance.Making team-building excellence everyone’s daily priority.Making team-building excellence everyone’s daily priority.Understanding value of matchless 1st-line management.Understanding value of matchless 1st-line management.

BFO 27:BFO 27: Aim to make EVERY internal and external Aim to make EVERY internal and external experience (PRODUCT/ SERVICE/SYSTEM/EMPLOYEE experience (PRODUCT/ SERVICE/SYSTEM/EMPLOYEE INTERACTION/CUSTOMER INTERACTION/ COMMUNITY INTERACTION/CUSTOMER INTERACTION/ COMMUNITY

INTERACTION) a … INTERACTION) a … WOW!WOW! (WOW = WOW. (WOW = WOW.

USE THE “W-WORD” PER SE! USE THE “W-WORD” PER SE! E.g., E.g., Do 4 out of your Top 5 projects score 8 or Do 4 out of your Top 5 projects score 8 or above on a 10-point“WOW Scale”?above on a 10-point“WOW Scale”? If not, get on it: If not, get on it: NOW. NOW. TODAY. TODAY. WITHIN THE HOUR.WITHIN THE HOUR.

WOW-ify!WOW-ify!WOW NowWOW Now.).)

BFO 28:BFO 28: While on the topic of … WOW: While on the topic of … WOW: White collar work is by and large ticketed to fall prey to White collar work is by and large ticketed to fall prey to artificial intelligence/eye-popping algorithms as well as artificial intelligence/eye-popping algorithms as well as globalization. Stand there and take it on the chin?globalization. Stand there and take it on the chin?NO.NO.My answer/1999 book/My answer/1999 book/The Professional Service Firm 50The Professional Service Firm 50::

CONVERT EVERY “DEPARTMENT”/ “UNIT” CONVERT EVERY “DEPARTMENT”/ “UNIT” [AND YOURSELF] INTO A FULL-FLEDGED … [AND YOURSELF] INTO A FULL-FLEDGED … “PSF”/PROFESSIONAL SERVICES FIRM … “PSF”/PROFESSIONAL SERVICES FIRM …

WHOLLY DEDICATED TO … WHOLLY DEDICATED TO … EXCELLENCEEXCELLENCE & & WOWWOW & & ADDINGADDING SKYSCRAPINGSKYSCRAPING VALUEVALUE TO THEIR/ YOUR CUSTOMERS’ TO THEIR/ YOUR CUSTOMERS’ [USUALLY INTERNAL CUSTOMERS] ACTIVITIES.[USUALLY INTERNAL CUSTOMERS] ACTIVITIES.Why not?Why not?There is no good reason not to proceed in this direction There is no good reason not to proceed in this direction within the fortnight!within the fortnight!

BFO 29:BFO 29: EVERYEVERY DAY PROVIDES A DOZEN DAY PROVIDES A DOZEN (LITERALLY) LEADERSHIP (LITERALLY) LEADERSHIP OPPORTUNITIES FOR OPPORTUNITIES FOR EVERYEVERY ONE OF US. ONE OF US. (Every = EVERY. From the most junior—(Every = EVERY. From the most junior—and and even the 3-day temp—even the 3-day temp—to the Big Dudes.)to the Big Dudes.)GRAB AT LEAST ONE.GRAB AT LEAST ONE.

BFO 30:BFO 30: Circa 2014+: You (me/all of Circa 2014+: You (me/all of us) totally misunderstand overall us) totally misunderstand overall econ context if you choose not to econ context if you choose not to

start today on … start today on … RPD/Radical RPD/Radical Personal Development.Personal Development.

BFO 31:BFO 31: CIVILITY WORKS. CIVILITY PAYS. CIVILITY WORKS. CIVILITY PAYS.

E.g.: E.g.: K = R = PK = R = P..

Kindness = Kindness = Repeat business =Repeat business =Profit.Profit.(ONE MORE TIME: “Kindness” is(ONE MORE TIME: “Kindness” is N-O-T N-O-T “Soft.”)“Soft.”)

BFO 32:BFO 32: Most of us/most organizations discount Most of us/most organizations discount … INTROVERTS. THAT IS A … … INTROVERTS. THAT IS A … 1ST ORDER 1ST ORDER STRATEGIC BLUNDER.STRATEGIC BLUNDER. (Please read Susan (Please read Susan Cain’s book Cain’s book QUIET. It was a no-bull QUIET. It was a no-bull lifechanger for me.)lifechanger for me.)

BFO 33:BFO 33: Listen (HARD) to my old D.C. boss, Listen (HARD) to my old D.C. boss, Fred Malek:Fred Malek:

““EXECUTION EXECUTION ISIS STRATEGY.” STRATEGY.” ((Kelleher/Southwest: Kelleher/Southwest: “We have a ‘strategic plan.’ “We have a ‘strategic plan.’ DOING THINGS.”DOING THINGS.”) (Welch/GE: ) (Welch/GE: “In real life, strategy is “In real life, strategy is actually very straightforward. Pick a general direction actually very straightforward. Pick a general direction … AND IMPLEMENT LIKE HELL.”… AND IMPLEMENT LIKE HELL.” ) (Charles Munger, ) (Charles Munger, Berkshire Hathaway: Berkshire Hathaway: “Costco figured out the big, “Costco figured out the big, simple things and executed with total fanaticism.”simple things and executed with total fanaticism.” ) )

(Execution: That all-important … (Execution: That all-important … “LAST 99 “LAST 99 PERCENT.”PERCENT.” ) )

BFO 34: The Works …BFO 34: The Works …

SEGEW 2014: SERVICE!-ENGAGEMENT!-GROWTH!-EXCELLENCE!-WOW!SEGEW 2014: SERVICE!-ENGAGEMENT!-GROWTH!-EXCELLENCE!-WOW!

Employees as 1st customersEmployees as 1st customers Acknowledgement & RespectAcknowledgement & Respect Commitment to Personal Growth & Training-to-Die-ForCommitment to Personal Growth & Training-to-Die-For EngagementEngagement Work Worth DoingWork Worth DoingPeerless 1st-line Leadership Cadre Committed to Employee GrowthPeerless 1st-line Leadership Cadre Committed to Employee GrowthMBWA ObsessionMBWA ObsessionSeamless Cross-functional ExcellenceSeamless Cross-functional Excellence360-degree “Social” Engagement Inside & Outside the Firm360-degree “Social” Engagement Inside & Outside the FirmCo-creation of EverythingCo-creation of EverythingA Moral Service Ethos A Moral Service Ethos (Each other/Vendors/Customers/Customers’ Customers/Communities)(Each other/Vendors/Customers/Customers’ Customers/Communities)An Ethos of Helping (“On the Bus” or “Off the Bus”)An Ethos of Helping (“On the Bus” or “Off the Bus”)Scintillating Design—Aesthetics & Functionality—Pervades EveryScintillating Design—Aesthetics & Functionality—Pervades Every Aspect of the Business (Inside & Outside)Aspect of the Business (Inside & Outside)Provision of Extraordinary Customer (& Employee) ExperiencesProvision of Extraordinary Customer (& Employee) Experiences Obsession With TGRs/Things Gone RightObsession With TGRs/Things Gone RightMatchless QualityMatchless Quality““Services Added”/Extended-Integrated-Partnered SolutionsServices Added”/Extended-Integrated-Partnered Solutions to Broad Customer Needsto Broad Customer NeedsRelentless Experimentation (“Bias for Action”/Instant Prototyping/Relentless Experimentation (“Bias for Action”/Instant Prototyping/ Celebration of “Excellent Failures”/Transparency/Celebration of “Excellent Failures”/Transparency/Pursuit of “Multipliers”)Pursuit of “Multipliers”)JOY!JOY! (In All We Do) (In All We Do)GROWTH! GROWTH! (In All We Do)(In All We Do)WOW!WOW! (In All We Do) (In All We Do)EXCELLENCE!EXCELLENCE! (In All We Do) (In All We Do)