re-imagine’s requisites : the leadership 11 tom peters/04.01.2004

Re-imagine’s Requisites:

The Leadership11

Tom Peters/04.01.2004

Slides at …

tompeters.com

“Uncertainty is the only thing to be sure of.” —Anthony Muh,

head of investment in Asia, Citigroup Asset Management

“If you don’t like change, you’re going to like

irrelevance even less.” —General Eric Shinseki, Chief of Staff,

U. S. Army

It is the foremost task—and responsibility—of our generation to

re-imagine our enterprises, private

and public. —from the Foreword, Re-imagine

Context: The Change Tsunami

Jobs Technology

Globalization War, Warfighting & Security

Jobs New Technology

Globalization War, Warfighting &

Security

The Perfect (Jobs) Storm

Off-shoringWC Automation

Reluctance to hire

“In a global economy, the government cannot give

anybody a guaranteed success story, but you can give people the tools to make the most of

their own lives.” —WJC, from Philip Bobbitt,

The Shield of Achilles: War, Peace, and the Course of History

“14 MILLION service jobs are in

danger of being shipped overseas” —

The Dobbs Report/USN&WR/11.03/re new UCB

study

“Income Confers No Immunity as Jobs Migrate” —Headline/USA Today/02.04

“One Singaporean worker costs as much as …

3 … in Malaysia 8 … in Thailand 13 … in China 18 … in India.”

Source: The Straits Times/08.18.03

“The proper role of a healthily functioning economy is to destroy

jobs and to put labor to use elsewhere. Despite this truth, layoffs and firings will always

sting, as if the invisible hand of free enterprise has slapped

workers in the face.” —Joseph Schumpeter

“There is no job that is America’s God-given right

anymore.” —Carly Fiorina/ HP/

01.08.2004

“WHAT ARE PEOPLE GOING TO DO WITH

THEMSELVES?” —Headline/

Fortune/ 11.03 (“We should finally admit that we do not and cannot know, and regard that fact with serenity

rather than anxiety.”)

“We erect walls to foreign trade and even discourage job-displacing innovations. But time and again

through our history, we have discovered merely to preserve the

comfortable features of the present, rather than reaching for new levels of

prosperity, is a sure path to stagnation.” —Alan Greenspan/03.12.2004

Jobs Technology


Security

<1000A.D.: paradigm shift: 1000s of years1000: 100 years for paradigm shift

1800s: > prior 900 years1900s: 1st 20 years > 1800s

2000: 10 years for paradigm shift

21st century: 1000X tech

change than 20th century (“the ‘Singularity,’ a merger between humans and computers that is so rapid and profound it

represents a rupture in the fabric of human history”)

Ray Kurzweil

E.g. …

Jeff Immelt: 75% of “admin, back room, finance” “digitalized” in

3 years.

Source: BW (01.28.02)

“A bureaucrat is an expensive

microchip.”Dan Sullivan, consultant and

executive coach

“I genuinely believe we are living through the greatest intellectual moment in history.”

Matt Ridley, Genome

“In 25 years, you’ll probably be able to get the

sum total of all human knowledge on a personal

device.”Greg Blonder, VC [was Chief Technical

Adviser for Corporate Strategy @ AT&T] [Barron’s 11.13.2000]

“A California biotechnology company has put the entire

sequence of the human genome on a single chip, allowing

researchers to conduct a single experiment on the complex

relationships between the 30,000 genes that make up a human being.” —Page 3, Financial Times/10.03.2003

Jobs Technology


Security

“Asia’s rise is the economic event of our age. Should it proceed as it has over the last few decades, it

will bring the two centuries of global domination by Europe and,

subsequently, its giant North American offshoot to an end.”

—Financial Times (09.22.2003)

“The world has arrived at a rare strategic inflection point where

nearly half its population—living in China, India and Russia—have been

integrated into the global market economy, many of them highly educated workers, who can do just about any job in the world. We’re talking about three billion people.” —Craig Barrett/Intel/01.08.2004

China Roars!

1990-2003: Exports 8X ($380B); 6% global exports 2003 vs. 3.9% 2000; 16% of

Total Global Growth in 2002.

Source: “China Takes Off”, David Hale & Lyric Hughes Hale/Foreign Affairs/Nov-Dec2003

1998-2003: 45,000,000 layoffs in state sector; offset by $450B in

foreign investment; foreign companies account for 50+% of exports vs. 31% in Mexico,

15% in Korea.


50% of output from private firms, 37% from state-owned

firms; 80% of workforce (incl. rural) now in private

employ.


Population growth = 1%; two-thirds of housing

privately owned, 90% of urban Chinese own a home

(vs. 61% in Japan)


200 cities with >1,000,000 population.


2003: China-Hong Kong leading producer in 8 of 12 key consumer electronic product areas (>50%: DVDs, digital cameras; >33.33%:

DVD-ROM drives, personal desktop and notebook computers; >25% mobile phones, color TVs,

PDAs, car stereos).Source: “China Takes Off”, David Hale & Lyric Hughes

Hale/Foreign Affairs/Nov-Dec2003

“Going Global: Flush with billions in foreign reserves,

China is embarking on a buying spree” —Cover/ Newsweek/ 03.01.04/ on

China’s aggressive offshore acquisition activity (buying brands,

technology, etc.)

World economic output: U.S.A., 21%; EU, 16%; China, 13%

(2X since1991)

Source: New York Times/12.14.2003

“America, like everyone else, must get used to being a loser as well as a gainer in the global economy. In the end, the

21st century is unlikely to be the American Century.” —“When the Chinese Consumer Is King”/New

York Times/12.14.2003. “The notion that God intended Americans to be permanently

wealthier than the rest of the world, that gets less and less likely as time

goes on.” —Robert Solow, Nobel laureate in economics/New York Times/12.14.2003

In Store: International Equality, Intranational Inequality

“The new organization of society implied by the triumph of individual autonomy and the true equalization of opportunity based upon merit will lead to very great

rewards for merit and great individual autonomy. This will leave individuals far more responsible for

themselves than they have been accustomed to being during the industrial period. It will also reduce the

unearned advantage in living standards that has been enjoyed by residents of advanced industrial societies

throughout the 20th century.”

James Davidson & William Rees-Mogg,The Sovereign Individual

Indian GDP/1990-2002: Ag, 34% to 21%; services,

40% to 56%

Source: The Economist/02.04

Level 5 (top) ranking/Carnegie Mellon

Software Engineering Institute: 35 of 70

companies in world are from India

Source: Wired/02.04

“Forget India, Let’s Go to Bulgaria” —Headline,

BW/03.04, re SAP, BMW, Siemens et al. “near-shoring”

Jobs Technology

Globalization

War, Warfighting & Security

“This is a dangerous world and it is going to become more

dangerous.”

“We may not be interested in chaos but chaos is interested

in us.”

Source: Robert Cooper, The Breaking of Nations: Order and Chaos in the Twenty-first Century

“The world’s new dimension (computers, Internet, globalization,

instantaneous communication, widely available instruments of mass

destruction and so on) amounts to a new metaphysics that, by empowering

individual zealots or agitated tribes with unappeasable grievances, makes the world unstable and dangerous in

radically new ways.” —Lance Morrow/Evil

“The new century risks being overrun by both anarchy and technology. The two great destroyers of history may reinforce each other. Both the spread of terrorism and that of weapons of mass destruction point to a world in which

Western governments are losing control. The spread of the technology of mass destruction represents a potentially massive redistribution of power

away from the advanced industrial (and democratic) states and toward smaller states that may be less stable and have less of a stake in an orderly world; or more dramatically still, it may represent a redistribution of power

away from the state itself and towards individuals, that is to say terrorists or criminals. In the past to be damaging, an ideological movement had to be

widespread to recruit enough support to take on authority. Henceforth, comparatively small groups will be able to do the sort of damage which

before only state armies or major revolutionary movements could achieve. A few fanatics with a ‘dirty bomb’ or biological weapons will be able to cause

death on a scale not previously envisaged. … Emancipation, diversity, global communication—all of the things that promise an age of riches and creativity—could also bring a nightmare in which states lose control of the means of

violence and people lose control of their futures.”—Robert Cooper, The Breaking of Nations: Order and Chaos in the Twenty-first Century

“Before we can talk about the security requirements for today

and tomorrow, we have to forget the security rules of yesterday.” —Robert Cooper, The

Breaking of Nations: Order and Chaos in the Twenty-first Century

All Bets Are Off!

“There will be more

confusion in the business world in the next decade than in any decade in history. And the current pace of

change will only accelerate.”Steve Case

“Let’s compete—by training the best workers, investing in R & D,

erecting the best infrastructure and building an education system that graduates students who rank with the worlds best. Our goal is to be competitive with the best so we

both win and create jobs.” —Craig Barrett (Time/03.01.04)

The “Ownership Society” (GWB): “This is a bundle of proposals that treat

workers as self-reliant pioneers who rise through several employers and

careers. To thrive, these pioneers need survival tools. They need to own their own capital reserves, their retraining

programs, their own pensions and their own health insurance.” —David

Brooks/NYT/12.20.03

Successful Businesses’ Dozen Truths: TP’s 30-Year Perspective

1. Insanely Great & Quirky Talent.2. Disrespect for Tradition.3. Totally Passionate (to the Point of Irrationality) Belief in What We Are Here to Do.4. Utter Disbelief at the Bullshit that Marks “Normal Industry Behavior.”5. A Maniacal Bias for Execution … and Utter Contempt for Those Who Don’t “Get It.”6. Speed Demons.7. Up or Out. (Meritocracy Is Thy Name. Sycophancy Is Thy Scourge.)8. Passionate Hatred of Bureaucracy.9. Willingness to Lead the Customer … and Take the Heat Associated Therewith. (Mantra: Satan Invented Focus Groups to Derail True Believers.)10. “Reward Excellent Failures. Punish Mediocre Successes.” 11. Courage to Stand Alone on One’s Record of Accomplishment Against All the Forces of Conventional Wisdom.12. A Crystal Clear Understanding of Brand Power.

The

Leadership11

The Leadership11

1. Talent Management2. Metabolic Management3. Technology Management4. Barrier Management5. Forgetful Management6. Metaphysical Management7. Opportunity Management8. Portfolio Management9. Failure Management10. Cause Management11. Passion Management

Steel: 75,000,000 tons in ’82 to 102,000,000 tons in ’02. 289,000 steelworkers

in ’82 to 74,000 steelworkers in ’02.

Source: Fortune/11.24.03

“WHERE IS YOUR JOB GOING”: writing software, designing chips,

reading MRIs, processing mortgages, preparing tax returns, managing

computer networks (etc: GE Capital’s 15,000 in Delhi), preparing PP slides

for McKinsey (350 in Chennai), equity analysis of U.S. companies (Morgan

Stanley) …Source: Fortune/11.24.03

“WHAT ARE PEOPLE GOING TO DO WITH

THEMSELVES?” —Headline

/Fortune/ 11.03 (“We should finally admit that we do not and cannot know, and regard that fact with

serenity rather than anxiety.”)

“Unless mankind redesigns itself by changing our DNA through altering our genetic

makeup, computer-generated robots will take

over the world.” – Stephen

Hawking, in the German magazine Focus

The Leadership11

Talent Management

In an age of value-added through imagination, creativity and

intellectual capital … the leader’s Job One is the recruitment,

development and retention of awesome talent.

Brand = Talent.

“When land was the scarce resource, nations battled

over it. The same is happening now for talented people.”

Stan Davis & Christopher Meyer, futureWEALTH

Age of AgricultureIndustrial Age

Age of Information IntensificationAge of Creation Intensification

Source: Murikami Teruyasu, Nomura Research Institute

“The Creative Class derives its identity from its members’ roles as

purveyors of creativity. Because creativity is the driving force of economic growth, in terms of

influence the Creative Class has become the dominant class in

society.” —Richard Florida, The Rise of the Creative Class (38M, 30%)

“The leaders of Great Groups love talent and know where to find it. They revel in

the talent of others.”Warren Bennis & Patricia Ward Biederman,

Organizing Genius

PARC’s Bob Taylor:

“Connoisseur of Talent”

Talent!

Tina Brown: “The first thing to do is to hire enough

talent that a critical mass of excitement starts to

grow.”Source: Business2.0/12.2002-01.2003

T.A.: 3

Model 25/8/53

Sports Franchise GM

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

for a day. They review the top 20 to 50 people by name. They talk about Talent Pool strengthening issues. The Talent

Review Process is a contact sport at GE; it has the intensity and the importance of the budget process at most companies.” —Ed

Michaels

From “1, 2 or you’re out” [JW] to …

“Best Talent in each industry segment to build

best proprietary intangibles” [EM]

Source: Ed Michaels, War for Talent

“Top performing companies are two to four times more likely

than the rest to pay what it takes to prevent losing

top performers.”

Ed Michaels, War for Talent (05.17.00)

DD$21M

“Where do good new ideas come from? That’s simple! From

differences. Creativity comes from unlikely juxtapositions.

The best way to maximize differences is to mix ages, cultures and

disciplines.”

Nicholas Negroponte

“Our business needs a massive transfusion of talent, and talent, I believe, is most likely to be found

among non-conformists, dissenters and rebels.”

David Ogilvy

“AS LEADERS, WOMEN RULE: New Studies find that female managers

outshine their male counterparts in almost

every measure”Title, Special Report, BusinessWeek, 11.20.00

Women’s Strengths Match New Economy Imperatives: Link [rather than rank] workers;

favor interactive-collaborative leadership style [empowerment beats top-down decision making]; sustain fruitful collaborations; comfortable with sharing information; see redistribution of power

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

“rationality”; inherently flexible; appreciate cultural diversity.

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

“Are men obsolete?” —Headline,

USN&WR/06.03.03

What’s your company’s …

EVP?Employee Value Proposition, per Ed

Michaels et al., The War for Talent;

IBP/Internal Brand Promise per TP

EVP = Challenge, professional growth, respect, satisfaction, opportunity, reward

Source: Ed Michaels et al., The War for Talent

Our Mission

To develop and manage talent;to apply that talent,

throughout the world, for the benefit of clients;to do so in partnership;

to do so with profit.

WPP

Talent’s “Big Two” Rules

GREAT Finance Dept. = GREAT Football Team

DIFFERENCES Among Cello Players = DIFFERENCES

Among Hotel GMs

The Top 5 “Revelations”

Better talent wins.

Talent management is my job as leader.

Talented leaders are looking for the moon and stars.

Over-deliver on people’s dreams – they are volunteers.

Pump talent in at all levels, from all conceivable sources, all the time.

Source: Ed Michaels et al., The War for Talent

Talent’s Rules

1. Talent = 25/8/53 2. Some people are better than other people. Some people are a helluva lot better than other people3. Think “Roster”4. Think “V.C.”5. Talent = Brand6. Talent is what leaders do.

Talent Department

People Department

Center for Talent Excellence

Seriously Cool People Who Recruit & Develop Seriously Cool People

Etc.

“Firms will not ‘manage the careers’ of their employees. They

will provide opportunities to enable the employee to develop

identity and adaptability and

thus be in charge of his or her own career.”

Tim Hall et al., “The New Protean Career Contract”

Quests!

“Ninety percent of what we call ‘management’ consists of making it

difficult for people to get things done.” – P.D.

“I don’t know.”

Distinct …or Extinct

“If there is nothing very special about your work, no matter how hard you apply yourself,

you won’t get noticed, and that increasingly means you won’t get

paid much either.”Michael Goldhaber, Wired

“better material welfare” vs. “maximize the opportunity of its

people” —Philip Bobbitt, The Shield of Achilles:

War, Peace, and the Course of History

“In a global economy, the government cannot give

anybody a guaranteed success story, but you can give people the tools to make the most of

their own lives.” —WJC, from Philip Bobbitt,

The Shield of Achilles: War, Peace, and the Course of History

Country Guarantee No One Is in Need Provide Freedom to Pursue Goals

U.S.A. 35% 58%Germany 58% 38%France 61% 36%UK 61% 35%Italy 65% 22%

Source: Economist/11.08.2003

“My ancestors were printers in Amsterdam from 1510 or so until

1750, and during that entire time they didn’t have to learn anything

new.”Peter Drucker, Business 2.0 (08.22.00)

“Knowledge becomes obsolete incredibly fast. The

continuing professional education of adults is the

No. 1 industry in the next 30 years … mostly on line.”

Peter Drucker,Business 2.0 (22August2000)

Prep: 1 hour per 1 minute (WSC) “Forget ‘practice makes perfect.’

Substitute ‘perfect practice makes perfect.’ ” (TT) “Major difference between ‘best’ and ‘average’?

‘Best’ get as much pleasure from practice as performance.” —Ben Zander

Edward Jones’ Training Machine*

146 hours/employee/yearNew hires: 4X avg.

3.8% of payroll

* #1, “The 100 Best Companies To Work For”/Fortune/01.2003

T.T.D./Assignment

Construct a 1/8-page or 1/4-page ad for

Brand You … for the Yellow Pages

“You are the storyteller of your own life, and you

can create your own legend or not.”

Isabel Allende

“For Marx, the path to social betterment was through collective resistance of the proletariat to the economic injustices of the capitalist system

that produced such misshapenness and fragmentation. For Emerson, the key was to jolt individuals into realizing the untapped power of energy, knowledge, and creativity of which all

people, at least in principle, are capable. He too hated all systems of human oppression; but his central project, and the basis of his legacy, was to unchain individual minds.” —Lawrence Buell, Emerson

I AM A TALENT FANATIC. I STACK UP WITH THE BEST FOOTBALL COACHES. OUR TALENT IS ON

QUESTS TO RE-IMAGINE TOMORROW. THE TALENT I

RECRUIT AND DEVELOP IS MY

PREMIER LEGACY. (Scale of 1 to 10?)

The Leadership11


The Leadership11

Metabolic Management

The “metabolism” of enterprise-competition-invention has speeded

up remarkably. It is the leader’s mission to increase—and manage—the Metabolic Rate of her or his

organization.

“How we feel about the evolving future tells us who we are as individuals and as a civilization: Do we search for stasis—a regulated, engineered world? Or do we embrace dynamism—a world of constant creation,

discovery and competition? Do we value stability and control or evolution and learning? Do we think that

progress requires a central blueprint, or do we see it as a decentralized, evolutionary process?? Do we see mistakes as permanent disasters, or the correctable

byproducts of experimentation? Do we crave predictability or relish surprise? These two poles,

stasis and dynamism, increasingly define our political, intellectual and cultural landscape.” —Virginia Postrel,

The Future and Its Enemies

“If things seem under control, you’re just not

going fast enough.”

Mario Andretti

“I’m not comfortable unless

I’m uncomfortable.”—Jay Chiat

“We are in a

brawl with no rules.”

Paul Allaire

S.A.V.

“Strategy meetings held once

or twice a year” to “Strategy meetings needed several

times a week.”

Source: New York Times on Meg Whitman/eBay

Rate of Leaving F500

1970-1990: 4XSource: The Company, John Micklethwait & Adrian

Wooldridge (1974-200: One-half biggest 100 disappear)

“Far from being a source of comfort,

bigness became a code for inflexibility.” —John

Micklethwait & Adrian Wooldridge, The Company

“Active mutators in placid times tend to die off. They

are selected against. Reluctant mutators in

quickly changing times are also selected against.”

Carl Sagan & Ann Druyan, Shadows of Forgotten Ancestors

“The secret of fast progress is

inefficiency, fast and furious and numerous

failures.”Kevin Kelly

The Kotler Doctrine:

1965-1980: R.A.F.(Ready.Aim.Fire.)

1980-1995: R.F.A.(Ready.Fire!Aim.)

1995-????: F.F.F.(Fire!Fire!Fire!)

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

“If Microsoft is good at anything, it’s avoiding the trap of worrying about criticism. Microsoft fails constantly.

They’re eviscerated in public for lousy

products. Yet they persist, through version after version, until they get

something good enough. Then they leverage the power they’ve gained in

other markets to enforce their standard.”Seth Godin, Zooming

Culture of Prototyping

“Effective prototyping may be

the most valuable core competence an innovative organization can

hope to have.”

Michael Schrage

Think about It!?

Innovation = Reaction to the Prototype

Michael Schrage

“If it works, it’s

obsolete.”

—Marshall McLuhan

OODA Loop/Boyd Cycle“Unraveling the competition”/ Quick Transients/ Quick Tempo (NOT JUST

SPEED!)/ Agility/ “So quick it is disconcerting” (adversary over-reacts or under-reacts)/ “Winners used tactics that caused the enemy to unravel before the

fight” (NEVER HEAD TO HEAD)

BOYD: The Fighter Pilot Who Changed the Art of War (Robert Coram)

“Blitzkrieg is far more than lightning thrusts that most people think of when they hear the term; rather it was all about high operational tempo and the rapid exploitation

of opportunity.”


“Float like a butterfly.

Sting like a bee.” —Ali

“Maneuverists”


Eric’s Army

Flat.Fast.Agile.Adaptable.Light … But Lethal.Talent/ “I Am an Army of One.”Info-intense.Network-centric.

The New Infantry Battalion/New York Times/12.01.2002

“Pentagon’s Urgent Search for Speed.” 270 soldiers (1/3rd normal complement); 140 robotic off-road armored trucks. “Every soldier is a

sensor.” “Revolutionary capabilities.” Find-to-hit: 45 minutes to 15 minutes

… in just one year.

“Rather than have massive armies that people can go along and

inspect, it is now about having rapidly deployable expediency forces that can be dropped by

land, sea or air and with full support.” —MoD official, on Defense Secretary Geoff

Hoon’s defense white paper (12.2003)

WE ARE ON A PERMANENT HIGH. WE LIVE ON SPEED. WE TACK

AND JIBE ON A NANOSECOND’S NOTICE. RECRIMINATION IS

MINIMAL. ACTION RULES. I AM PROACTIVE AROUND THE CAUSE

OF URGENCY. (Scale of 1 to 10?)

The Leadership11


The Leadership11

Technology Management

The Internet and other associated technologies are changing …

everything. The leader must take direct charge of the full-bore implementation of the new

technologies. The wise leader is his own CIO.

“E-commerce is happening the way all the hype said it would. Internet

deployment is happening. Broadband is happening. Everything we ever said about the Internet is happening. And it

is very, very early. We can’t even glimpse IT’s potential in changing the way people work and live.” —Andy Grove

(BusinessWeek/August 2003)

100 square feet

“Our entire facility is digital. No paper, no film, no medical records. Nothing. And it’s all integrated—from the lab to X-ray to records to physician order entry. Patients don’t have to wait for anything. The information from the physician’s office is

in registration and vice versa. The referring physician is immediately sent an email telling him his patient has shown up. … It’s wireless in-house. We have 800 notebook computers that are wireless. Physicians can walk around with a computer that’s

pre-programmed. If the physician wants, we’ll go out and wire their house so they can sit on the couch and connect to the

network. They can review a chart from 100 miles away.” —David Veillette, CEO, Indiana Heart Hospital (HealthLeaders/12.2002)

“Dawn Meyerreicks, CTO of the Defense Information Systems Agency, made one of the most fateful military calls of the 21st century. After 9/11 … her office

quickly leased all the available transponders covering Central Asia. The implications should change everything about U.S. military thinking in the

years ahead.

“The U.S. Air Force had kicked off its fight against the Taliban with an ineffective bombing campaign, and Washington was anguishing over whether to send in a few Army divisions. Donald Rumsfeld told Gen. Tommy Franks to

give the initiative to 250 Special Forces already on the ground. They used satellite phones, Predator surveillance drones, and GPS- and laser-based

targeting systems to make the air strikes brutally effective.

“In effect, they ‘Napsterized’ the battlefield by cutting out the middlemen (much of the military’s command and control) and working directly with the

real players. … The data came in so fast that HQ revised operating procedures to allow intelligence analysts and attack planners to work directly

together. Their favorite tool, incidentally, was instant messaging over a secure network.”—Ned Desmond/“Broadband’s New Killer App”/Business

2.0/ OCT2002

“The mechanical speed of combat vehicles has not

increased since Rommel’s day, so the difference is all in the

operational speed, faster communications and faster

decisions.” —Edward Luttwak, on the unprecedented pace of the move toward Baghdad

Eric’s Army

Flat.Fast.Agile.Adaptable.Light … But Lethal.Talent/ “I Am an Army of One.”Info-intense.Network-centric.

“Hyperlinks subvert hierarchy!”

The Cluetrain Manifesto

Words to Live By …

“Hierarchy is an organization with its face

toward the CEO and it’s ass toward the customer.”

Kjell Nordström and Jonas Ridderstråle, Funky Business

WebWorld = Everything

Web as a way to run your business’s innardsWeb as connector for your entire supply-demand chain Web as “spider’s web” which re-conceives the industry

Web/B2B as ultimate wake-up call to “commodity producers”

Web as the scourge of slack, inefficiency, sloth, bureaucracy, poor customer data

Web as an Encompassing Way of LifeWeb = Everything (P.D. to after-sales)

Web forces you to focus on what you do bestWeb as entrée, at any size, to World’s Best at Everything

as next door neighbor

“There’s no use trying,” said Alice. “One can’t believe impossible things.”

“I daresay you haven’t had much practice,” said the Queen. “When I was

your age, I always did it for half an hour a day. Why, sometimes I’ve

believed as many as six impossible things before breakfast.”

Lewis Carroll

I’net …

… allows you to dream dreams

you could never have dreamed

before!

Case: CRM

Amen!

“The Age of the

Never Satisfied Customer”

Regis McKenna

“CRM has, almost universally, failed

to live up to expectations.”

Butler Group (UK)

No! No! No! FT: “The aim [of CRM] is to make customers feel as they did in the pre-

electronic age when service was more personal.”

CGE&Y (Paul Cole): “Pleasant

Transaction” vs. “Systemic Opportunity.” “Better job

of what we do today” vs. “Re-think overall

enterprise strategy.”

Here We Go Again: Except It’s Real This Time!

Bank online: 24.3M (10.2002); 2X Y2000.

Wells Fargo: 1/3rd; 3.3M; 50% lower

attrition rate; 50% higher growth in balances than off-line; more likely to cross-purchase; “happier and stay

with the bank much longer.”

Source: The Wall Street Journal/10.21.2002

TECHNOLOGY CHANGES EVERYTHING. I AM A TRUE

BELIEVER. NOW IS THE MOMENT FOR INSANELY BOLD

INVESTMENT AND TOTAL CORPORATE RE-IMAGINATION.

(Scale of 1 to 10?)

The Leadership11


The Leadership11

Barrier Management

The “corporate metabolism” cannot be speeded up and the new

technologies cannot be fully exploited unless all barriers to X-functional

communication (throughout the entire supply and demand chain) are

destroyed. The leader must lead—get directly involved in the minutiae of

this STRATEGIC task.

“IT MAY SOMEDAY BE SAID THAT THE 21ST CENTURY BEGAN ON SEPTEMBER 11, 2001. …

“Al-Qaeda represents a new and profoundly dangerous kind of

organization—one that might be called a ‘virtual state.’ On September 11 a virtual

state proved that modern societies are vulnerable as never before.”—Time/09.09.2002

“The deadliest strength of America’s new adversaries is their very fluidity, Defense Secretary Donald

Rumsfeld believes. Terrorist networks, unburdened by fixed borders, headquarters or conventional forces, are

free to study the way this nation responds to threats and adapt themselves to prepare for what Mr. Rumsfeld is certain will be another attack. …

“ ‘Business as usual won’t do it,’ he said. His answer is to develop swifter, more lethal ways

to fight. ‘Big institutions aren’t swift on their feet in adapting but rather ponderous and clumsy

and slow.’ ”—The New York Times/09.04.2002

From: Weapon v. Weapon

To: Org structure v. Org structure

“Our military structure today is essentially one

developed and designed by Napoleon.”

Admiral Bill Owens, former Vice Chairman, Joint Chiefs of Staff

“The organizations we created have become tyrants. They have taken

control, holding us fettered, creating barriers that hinder rather than help our businesses. The lines that we drew on our neat organizational diagrams have turned into walls

that no one can scale or penetrate or even peer over.” —Frank Lekanne Deprez &

René Tissen, Zero Space: Moving Beyond Organizational Limits.

“In an era when terrorists use satellite

phones and encrypted email, US gatekeepers stand armed against them with pencils

and paperwork, and archaic computer systems that don’t

talk to each other.”Boston Globe (09.30.2001)

“Dawn Meyerreicks, CTO of the Defense Information Systems Agency, made one of the most fateful military calls of the 21st century. After 9/11 … her office

quickly leased all the available transponders covering Central Asia. The implications should change everything about U.S. military thinking in the

years ahead.

“The U.S. Air Force had kicked off its fight against the Taliban with an ineffective bombing campaign, and Washington was anguishing over whether to send in a few Army divisions. Donald Rumsfeld told Gen. Tommy Franks to

give the initiative to 250 Special Forces already on the ground. They used satellite phones, Predator surveillance drones, and GPS- and laser-based

targeting systems to make the air strikes brutally effective.

“In effect, they ‘Napsterized’ the battlefield by cutting out the middlemen (much of the military’s command and control) and working directly with the

real players. … The data came in so fast that HQ revised operating procedures to allow intelligence analysts and attack planners to work directly

together. Their favorite tool, incidentally, was instant messaging over a secure network.”—Ned Desmond/“Broadband’s New Killer App”/Business

2.0/ OCT2002

Message: eCommerce is not a technology play! It is a

relationship, partnership, organizational and

communications play, made possible by new

technologies.

Message: There is no such thing as an effective B2B or

Internet-supply chain strategy in a low-trust,

bottlenecked-communication, six-layer

organization.

“Ebusiness is about rebuilding the organization from the

ground up. Most companies today are not built to exploit the Internet.

Their business processes, their approvals, their hierarchies, the

number of people they employ … all of that is wrong for running an

ebusiness.”

Ray Lane, Kleiner Perkins

“The corporation as we know it, which is now 120 years old, is

not likely to survive the next 25 years. Legally and

financially, yes, but not structurally and economically.”

Peter Drucker, Business 2.0

BARRIERS MUST GO. PERIOD. I AM INTIMATELY INVOLVED WITH THE GRUBBY DETAILS OF TOTAL PROCESS RE-DESIGN. WE WILL

NOT PARTNER WITH THOSE THAT

DON’T “GET IT.” (Scale of 1 t0 10?)

The Leadership11


The Leadership11

Forgetful Management

The new competitive realities demand that we turn our backs on

the ones who brung us. Every leader needs a FORMAL

“forgetting strategy.”

Forbes100 from 1917 to 1987: 39 members of the Class of ’17 were alive

in ’87; 18 in ’87 F100; 18 F100 “survivors” underperformed the market

by 20%; just 2 (2%), GE & Kodak, outperformed the market 1917 to 1987.

S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were

alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997.

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

“It is generally much easier to kill an

organization than change it

substantially.” Kevin Kelly, Out of Control

Cortez!

Leaders “dump the ones who brung ’em” —Nokia, HP, 3M, PerkinElmer, Corning, etc.

“It’s just a fact: Survivors underperform.”

—Dick Foster

Forget>“Learn”

“The problem is never how to get new, innovative

thoughts into your mind,

but how to get the old ones out.”

Dee Hock

Success Kills!

“The more successful a company, the flatter its

forgetting curve.” — Gary Hamel and C.K. Prahalad

“FORGET IT” IS MY MISSION AND MANTRA. WE MUST SEVER

MANY/MOST OF OUR TIES TO THE PAST … AND IMAGINE

COMPLETELY NEW WORLDS. EVERYONE KNOWS THAT

“FORGETTING” IS MY PASSION.

(Scale of 1 to 10?)

The Leadership11


The Leadership11

Metaphysical Management

A brand new value proposition is emerging. We are moving toward

more and more ethereal “products” and “services.” The

leader must oversee this process—become the Metaphysician-in-

Chief.

“While everything may

be better, it is also increasingly the same.”

Paul Goldberger on retail, “The Sameness of Things,” The New York Times

“The ‘surplus society’ has a surplus of

similar companies, employing

similar people, with similar educational backgrounds, coming up

with similar ideas, producing

similar things, with similar prices

and similar quality.”

Kjell Nordström and Jonas Ridderstråle, Funky Business

“Companies have defined so much ‘best practice’

that they are now more or less identical.”

Jesper Kunde, Unique Now ... or Never

“We make over three new product announcements a

day. Can you remember

them? Our customers can’t!”Carly Fiorina

09.11.2000: HP bids

$18,000,000,000for

PricewaterhouseCoopersconsulting business!

“These days, building the best server isn’t enough. That’s the

price of entry.”Ann Livermore, Hewlett-Packard

Gerstner’s IBM: Systems Integrator of

choice. Global Services:

$35B. Pledge/’99: Business Partner Charter. 72 strategic partners,

aim for 200. Drop many in-house

programs/products. (BW/12.01).

“UPS wants to take over the sweet spot in the endless loop

of goods, information and capital that all the packages

[it moves] represent.”ecompany.com/06.01 (E.g., UPS Logistics

manages the logistics of 4.5M Ford vehicles, from 21 mfg. sites to 6,000 NA dealers)

E.g. …

UTC/Otis + Carrier: boxes to “integrated building systems”

Leased AC: Units of “Coolth”

Omnicom: 57% (of

$6B) from marketing services

And the Winners Are …

Televisions –12%Cable TV service +5%

Toys -10%Child care +5%

Photo equipment -7%Photographer’s fees +3%

Sports Equipment -2%Admission to sporting event +3%

New car -2%Car repair +3%

Dishes & flatware -1%Eating out +2%

Gardening supplies -0.1%Gardening services +2%

Source: WSJ/05.16.03

IBM/Q3/10.15.03/Rev: +5%

Services/Consulting: +11%Software: +5%Hardware: -5%

PCs: -2%Technology/Chips: -33%

Turnkey Nation

HP … Sun … Farmers Group … Northwestern Mutual Financial Network …

IBM … AT&T … Ericsson … GE Power Systems … GE Industrial Systems … Ford … Siemens … Home Depot …

Deere … UTC Otis … UTC Carrier … UPS … Springs Industries … RCI …

Equity Office Properties … Omnicom … India … Etc.

“Experiences are as distinct from services as services are from

goods.”Joseph Pine & James Gilmore, The Experience Economy:

Work Is Theatre & Every Business a Stage

“Club Med is more than just a ‘resort’; it’s a means of rediscovering oneself, of inventing an

entirely new ‘me.’ ”

Source: Jean-Marie Dru, Disruption

“Guinness as a brand is all about community.

It’s about bringing people together and sharing

stories.”—Ralph Ardill, Imagination, in re Guinness Storehouse

“The [Starbucks] Fix” Is on …

“We have identified a ‘third place.’ And I really believe that sets us apart. The third place is

that place that’s not work or home. It’s the place our

customers come for refuge.”Nancy Orsolini, District Manager

Experience: “Rebel Lifestyle!”

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

through small towns and have people be afraid of him.”

Harley exec, quoted in Results-Based Leadership

WHAT CAN BROWN DO FOR YOU?

The “Experience Ladder”

Experiences Services

Goods Raw Materials

Bob Lutz: “I see us as being in the art business. Art,

entertainment and mobile sculpture, which,

coincidentally, also happens to provide transportation.”

Source: NYT 10.19.01

“Lexus sells its cars as containers for our

sound systems. It’s marvelous.”—Sidney Harman/

Harman International

It’s All About EXPERIENCES: “Trapper” to “Wildlife Damage-control Professional”

Trapper: <$20 per beaver pelt.

WDCP: $150/“problem beaver”; $750-$1,000 for flood-control

piping … so that beavers can stay.

Source: WSJ/05.21.2002

Moving Companies

WSJ/08.2003: “In Texas, They’ll fill your empty fridge with brie and

wine. An outfit in New York promises quick high-speed Internet

hookup. And when Allied Van Lines finishes unloading your couch, they’ll have a feng shui

expert figure out the right spot. …”

Duet … Whirlpool … “washing machine” to “fabric care system” … white goods: “a sea of

undifferentiated boxes” … $400 to $1,300 … “the Ferrari of washing machines” …

consumer: “They are our little mechanical buddies. They have personality. When they are

running efficiently, our lives are running efficiently. They are part of my family.” …

“machine as aesthetic showpiece” … “laundry room” to “family studio” / “designer laundry

room” (complements Sub-Zero refrigerator and home-theater center)

Source: New York Times Magazine/01.11.2004

DREAM: “A dream is a complete moment in the life of a client.

Important experiences that tempt the client to commit substantial resources. The essence of the desires of the consumer. The

opportunity to help clients become what they want to be.” —Gian Luigi

Longinotti-Buitoni

“No longer are we only an insurance provider. Today, we also offer our

customers the products and services that help them achieve their dreams,

whether it’s financial security, buying a car, paying for home repairs, or even taking a dream vacation.” —Martin Feinstein,

CEO, Farmers Group

The marketing of Dreams (Dreamketing)

Dreamketing: Touching the clients’ dreams.

Dreamketing: The art of telling stories and entertaining.

Dreamketing: Promote the dream, not the product.

Dreamketing: Build the brand around the main dream.

Dreamketing: Build the “buzz,” the “hype,” the “cult.”

Source: Gian Luigi Longinotti-Buitoni

(Revised) Experience Ladder

Dreams Come True Awesome Experiences

SolutionsServicesGoods

Raw Materials

And Tomorrow …

“Fifteen years ago companies competed on price. Now it’s

quality. Tomorrow it’s design.”

Robert Hayes

All Equal Except …

“At Sony we assume that all products of our competitors have basically the same

technology, price, performance and

features. Design is the only thing that differentiates one product from another in the

marketplace.”Norio Ohga

“Design is treated like a religion at

BMW.”Fortune

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

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

meaning of design. Design is the fundamental soul

of a man-made creation.”

Steve Jobs

“The sun is setting on the Information Society—even before we have fully adjusted to its demands as individuals and as

companies. We have lived as hunters and as farmers, we have worked in factories and now we live in an information-based society whose icon is the computer. We stand facing the fifth kind of society: the Dream Society. … The Dream Society is emerging this very instant—the shape of the future is visible today. Right now is the time for decisions—before the major

portion of consumer purchases are made for emotional, nonmaterialistic reasons. Future products will have to appeal to our hearts, not to our heads. Now is the time to add emotional

value to products and services.” —Rolf Jensen/The Dream Society:How the Coming Shift from Information to Imagination Will Transform Your Business

“A shipping clerk earning $25,000 a year treats herself to silk pajamas at Victoria’s Secret. A dual-income couple earning

$125,000 orders a $4,000 Viking range for their townhouse even though the developer offered to throw in a perfectly serviceable

generic range at no extra charge. These purchases reflect an important worldwide behavioral shift. Consumers today are willing to pay a significant premium for goods and services that are emotionally important to them and that deliver the perceived values of quality, performance and engagement.

But in other categories that aren’t emotionally important, they become bargain hunters: a passionate Mercedes driver will shop at Target every weekend; a construction worker who

splurges on a $3,000 set of Callaway golf clubs will buy store brand groceries.” —Trading Up: The New American Luxury/Michael

Silverstein & Neil Fiske

“Most executives have no idea how to add value to a market in the metaphysical

world. But that is what the market will cry out for in the future. There is no lack of ‘physical’ products to

choose between.”Jesper Kunde, Unique Now ... or Never [on the excellence of Nokia, Nike, Lego, Virgin

et al.]

15 “Leading” Biz Schools

Design/Core: 0Design/Elective: 1Creativity/Core: 0

Creativity/Elective: 4Innovation/Core: 0

Innovation/Elective: 6

Source: DMI/Summer 2002

New Market Realities

Selling Dreams: How to Make Any Product Irresistible, Gian Luigi Longinotti-Buitoni

The Dream Society: How the Coming Shift from Information to Imagination Will Transform Your

Business, Rolf Jensen

Trading Up: The New American Luxury, Michael Silverstein & Neil Fiske

I FULLY COMPREHEND THAT THE “BASIC VALUE PREMISE” IS

SHIFTING … DRAMATICALLY AND RAPIDLY. I AM WHOLLY

COMMITTED TO BECOMING “MASTER METAPHYSICIAN.”

(Scale of 1 to 10?)

The Leadership11


The Leadership11

Opportunity Management

The two biggest (by far) “trends” are ignored—or at least not treated as Strategic Priority One—by most.

Women! Boomers & Geezers! Why? (And … what does the leader

plan to do about it?)

Women & the Marketspace.

?????????

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

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

Consumer Electronics … 51% (66% home computers)

Cars … 68% (90%)All consumer purchases … 83%

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

Health Care … 80%

$5+T > Japan

10M/28M/$3.6T > Germany

Yeow!

1970 … 1%

2002 … 50%

91% women: ADVERTISERS DON’T

UNDERSTAND US. (58% “ANNOYED.”)

Source: Greenfield Online for Arnold’s Women’s Insight Team (Martha Barletta, Marketing to Women)

Carol Gilligan/ In a Different Voice

Men: Get away from authority, familyWomen: Connect

Men: Self-orientedWomen: Other-oriented

Men: RightsWomen: Responsibilities

FemaleThink/ Popcorn

“Men and women don’t think the same way, don’t communicate the same

way, don’t buy for the same reasons.”

“He simply wants the transaction to take place. She’s interested in

creating a relationship. Every place women go, they make

connections.”

“Men seem like loose cannons. Men always move faster through a store’s

aisles. Men spend less time looking. They usually don’t like asking where things are.

You’ll see a man move impatiently through a store to the section he wants,

pick something up, and then, almost abruptly he’s ready to buy. For a

man, ignoring the price tag is almost a sign of virility.”

Paco Underhill, Why We Buy* (*Buy this book!)

Women's View of Male Salespeople

Technically knowledgeable; assertive; get to the point; pushy;

condescending; insensitive to women’s needs.

Source: Judith Tingley, How to Sell to the Opposite Sex (Martha Barletta, Marketing to Women)

Read This: Barbara & Allan Pease’s

Why Men Don’t Listen & Women Can’t Read Maps

“It is obvious to a woman when another woman is upset, while a man generally has to physically witness

tears or a temper tantrum or be slapped in the face before he even has a clue that anything is going on. Like most female mammals, women are equipped with far more finely tuned

sensory skills than men.” Barbara & Allan Pease, Why Men Don’t Listen & Women Can’t Read Maps

“Resting” State: 30%, 90%: “A woman knows her children’s

friends, hopes, dreams, romances, secret fears, what they are

thinking, how they are feeling. Men are vaguely aware of some short people also living in the house.”

Barbara & Allan Pease, Why Men Don’t Listen & Women Can’t Read Maps

“As a hunter, a man needed vision that would allow him to zero in on targets in the distance … whereas a woman needed eyes

to allow a wide arc of vision so that she could monitor any predators sneaking up on the nest. This is why modern men can find their way effortlessly to a distant pub,

but can never find things in fridges, cupboards or drawers.”


“Female hearing advantage contributes significantly to what is

called ‘women’s intuition’ and is one of the reasons why a woman can read between the lines of what people say. Men, however, shouldn’t despair.

They are excellent at imitating animal sounds.”


Senses

Vision: Men, focused; Women, peripheral.

Hearing: Women’s discomfort level I/2 men’s.

Smell: Women >> Men.Touch: Most sensitive man <

Least sensitive women.

Source: Martha Barletta, Marketing to Women

“When a woman is upset, she talks emotionally to her friends; but an upset man rebuilds a motor or

fixes a leaking tap.”Barbara & Allan Pease, Why Men Don’t Listen &

Women Can’t Read Maps

“Women are more comfortable talking or

thinking about people and relationships, while men

prefer to contemplate things.” —research reported in the New York

Times (08.10.2003)

Editorial/Men: Tables, rankings.*

Editorial/Women: Narratives that cohere.*

*Redwood (UK)

Read This Book …

EVEolution: The Eight Truths of Marketing to Women

Faith Popcorn & Lys Marigold

EVEolution: Truth No. 1

Connecting Your Female Consumers to Each

Other Connects Them to Your Brand

“The ‘Connection Proclivity’ in women starts early. When asked,

‘How was school today?’ a girl usually tells her mother every

detail of what happened, while a boy might grunt, ‘Fine.’ ”

EVEolution

“Women don’t buy

brands. They join them.”

EVEolution

2.6 vs. 21

1. Men and women are different.2. Very different.3. VERY, VERY DIFFERENT.4. Women & Men have a-b-s-o-l-u-t-e-l-y nothing in common.5. Women buy lotsa stuff.6. WOMEN BUY A-L-L THE STUFF.7. Women’s Market = Opportunity No. 1.8. Men are (STILL) in charge.9. MEN ARE … TOTALLY, HOPELESSLY CLUELESS ABOUT WOMEN.10. Women’s Market = Opportunity No. 1.

Psssst! Wanna see my “porn” collection?

Boomers & Geezers.

Subject: Marketers & Stupidity

“It’s 18-44, stupid!”

Subject: Marketers & Stupidity

Or is it: “18-44 is stupid,

stupid!”

2000-2010 Stats

18-44: -1%

55+: +21%(55-64: +47%)

44-65: “New Consumer Majority” *

*45% larger than 18-43; 60% larger by 2010Source: Ageless Marketing, David Wolfe & Robert Snyder

“The New Consumer Majority is the only adult

market with realistic prospects for significant

sales growth in dozens of product lines for thousands of companies.” —David Wolfe & Robert

Snyder, Ageless Marketing

“Baby-boomer Women: The Sweetest of

Sweet Spots for Marketers” —David Wolfe and

Robert Snyder, Ageless Marketing

Aging/“Elderly”

$$$$$$$$$$$$“I’m in charge!”

“NOT ACTING THEIR AGE: As Baby Boomers

Zoom into Retirement, Will America Ever Be the

Same?”USN&WR Cover/06.01

“Sixty Is the New Thirty”

—Cover/AARP/11.03

50+

$7T wealth (70%)/$2T annual income50% all discretionary spending

79% own homes/40M credit card users41% new cars/48% luxury cars

$610B healthcare spending/74% prescription drugs

5% of advertising targets

Ken Dychtwald, Age Power: How the 21st Century Will Be Ruled by the New Old

“Marketers attempts at reaching those over 50 have

been miserably unsuccessful. No market’s motivations and needs are so poorly understood.”—Peter

Francese, founding publisher, American Demographics

“ ‘Age Power’ will rule the 21st century, and we are woefully

unprepared.”Ken Dychtwald, Age Power: How the 21st

Century Will Be Ruled by the New Old

No: “Target Marketing”

Yes: “Target

Innovation” & “Target Delivery Systems”

“BofA Is Betting Its Future on the Hispanic Market” *

“We expect to get no less than

80 % of our future growth in

retail banking from the Hispanic market.” —Ken Lewis, CEO, BofA

*Fortune/04.2003

I GET IT! WOMEN! BOOMERS & GEEZERS! IT’S WHERE THE LOOT IS! WE ARE “GOING STRATEGIC”

ON THIS! (Scale of 1 to 10?)

The Leadership11


The Leadership11

Portfolio Management

We must think of the “rosters” of talent, customers, suppliers, leader,

projects, initiatives—and the Board—in terms of portfolios. I.e.: Is our

portfolio as strange as these strange times demand? The leader is a “V.C.”

(venture capitalist) creating and managing several strategically vital

portfolios.

“Good management was the most powerful reason [leading firms] failed to stay atop their industries. Precisely because these firms

listened to their customers, invested aggressively in technologies that would provide their customers more

and better products of the sort they wanted, and because they carefully studied market trends and

systematically allocated investment capital to innovations that promised the best returns, they lost

their positions of leadership.”

Clayton Christensen, The Innovator’s Dilemma

THINK WEIRD: The High Standard

Deviation Enterprise.

Saviors-in-Waiting

Disgruntled CustomersOff-the-Scope Competitors

Rogue EmployeesFringe Suppliers

Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on Fringe Competitors, Lost Customers, and Rogue Employees

CUSTOMERS: “Future-defining customers may

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

window on the future.”Adrian Slywotzky, Mercer Consultants

COMPETITORS: “The best swordsman in the world doesn’t need to fear

the second best swordsman in the world; no, the person for him to be afraid of is some ignorant antagonist who has never had a

sword in his hand before; he doesn’t do the thing he ought to do, and so the expert isn’t

prepared for him; he does the thing he ought not to do and often it catches the expert out and

ends him on the spot.”

Mark Twain

“To grow, companies need to break out of a vicious

cycle of competitive benchmarking, imitation and pursuit.” —W. Chan Kim & Renee Mauborgne, “Think

for Yourself —Stop Copying a Rival,” Financial Times/08.11.03

Employees: “Are there enough weird

people in the lab these days?”

V. Chmn., pharmaceutical house, to a lab director (06.01)

Audie Murphy was the most decorated soldier in WW2.

He won every medal we had to offer, plus 5 presented by Belgium and France. There was one common medal he

never won …

… the Good Conduct medal.

Herman Melville on JPJ: “intrepid, unprincipled,

reckless, predatory, with boundless ambition,

civilized in externals but a savage at heart.” —from Evan

Thomas, John Paul Jones: Sailor, Hero, Father of the American Navy

Suppliers: “There is an ominous downside to strategic supplier

relationships. An SSR supplier is not likely to function as any more than a mirror to your organization. Fringe suppliers that offer innovative business practices need

not apply.”

Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on Fringe Competitors, Lost Customers, and Rogue Employees

Boards: “Extremely contentious boards that regard dissent as an

obligation and that treat no subject as undiscussable” —Jeffrey

Sonnenfeld, Yale School of Management

We become who we

hang out with!

WEIRD IDEAS THAT WORK: (1) Hire slow learners (of the organizational code). (1.5) Hire people who make you

uncomfortable, even those you dislike. (2) Hire people you (probably) don’t need. (3) Use job interviews to get ideas, not

to screen candidates. (4) Encourage people to ignore and defy superiors and peers. (5) Find some happy people and get them to fight. (6) Reward success and failure, punish inaction.

(7) Decide to do something that will probably fail, then convince yourself and everyone else that success is certain. (8) Think of

some ridiculous, impractical things to do, then do them. (9) Avoid, distract, and bore customers, critics, and anyone who just wants to talk about money. (10) Don’t try to learn anything from people who seem to have solved the problems you face.

(11) Forget the past, particularly your company’s success.

Bob Sutton, Weird Ideas That Work: 11½ Ideas for Promoting, Managing, and Sustaining Innovation

Advice to Corporate Leaders: “Consider the metaphor of the windmill: You can harness raw

power but you can’t control it. … Hire artists, clowns, or other disrupters to come in and

challenge your corporate environment. … Hire a corporate anthropologist to analyze how tolerant

your organization is of deviants and other

innovators. … Once the anthropologist leaves, hire a shaman to drive out the

evil spirits of conformity. …”

Source: Ryan Matthews & Watts Wacker, Fast Company (03.02)

Deviants, Inc. “Deviance tells the story of every mass

market ever created. What starts out weird and dangerous

becomes America’s next big corporate payday. So are you looking for the next mass market idea? It’s out there … way

out there.”

Source: Ryan Matthews & Watts Wacker, Fast Company (03.02)

“ ‘Giant’ projects contain within them the almost certain seeds of mediocrity. The very fact of their size causes constant

scrutiny and thence ‘political’ interference. Such ‘oversight’ drains the passion of the

champions and risks—to the point of certainty—fatal ‘dumbing down’ and

thence loss of the very distinction and quirkiness sought in the first place.”—

Exec, Hollywood

Big Idea/s

V.C. PortfolioRoster

I AM A “V.C.” I OBSESS ABOUT MY VARIOUS “ROSTERS”—EMPLOYEES, CUSTOMERS, ETCETERA. I MEASURE MY

ROSTERS’ “WEIRDNESS

QUOTIENT.” (Scale of 1 to 10?)

The Leadership11


The Leadership11

Failure Management

Screwing up is more important than ever in strange times. The

screw-up rate is the best indicator of sufficiently rapid adaptation. The leader must “manage” the

screw-up process—literally.

“Wealth in this new regime flows directly from innovation, not

optimization. That is, wealth is not gained by perfecting the known,

but by imperfectly seizing the unknown.”

Kevin Kelly, New Rules for the New Economy

The [New] Ge Way

DYB.com

“Perfection is achieved only by

institutions on the point of

collapse.” — C. Northcote Parkinson

“The secret of fast progress is

inefficiency, fast and furious and numerous

failures.”Kevin Kelly

RM: “A lot of companies in the Valley fail.”

RN: “Maybe not enough fail.”

RM: “What do you mean by that?”

RN: “Whenever you fail, it means you’re trying new things.”

Source: Fast Company

“The Silicon Valley of today is built less atop

the spires of earlier triumphs than upon the

rubble of earlier debacles.” —Newsweek/ Paul Saffo (03.02)

Silicon Valley Success [Failure?] Secrets

“Pursuit of risk”: 4 of 20 in V.C. portfolio go bust; 6 lose money;

6 do okay; 3 do well; 1 hits the jackpot

Source: The Economist

Excellence = 1 in 20

“... natural selection is death. ... Without huge amounts of death, organisms do not change over time. ... Death is the mother of structure. ... It took four billion years of death ... to invent the human mind ...” — The Cobra Event

DG to TP: “Sam is not afraid

to fail.” **NASA failing #1, from the shuttle disaster report (July 2003):

“fear of retribution by lower-level employees.”

“Fail faster. Succeed sooner.”

David Kelley/IDEO

Fail. Forward. Fast. –High-tech Exec

“No matter. Try again. Fail again. Fail

better.” —Samuel Beckett

“Success is the ability to go from failure to

failure without losing your enthusiasm.” —Winston

Churchill

“Reward excellent

failures. Punish mediocre successes.”

Phil Daniels, Sydney exec (and, de facto, Jack)

WE DO NO “WITCH HUNTS”! WE FULLY UNDERSTAND THAT

WE ARE AS GOOD AS OUR “EXCELLENT FAILURES.” WE

CHERISH THE BOLD AND

BLOODIED ONES. (Scale of 1 to 10?)

The Leadership11


The Leadership11

Cause Management

People “sign up” for causes worth pursuing. Turning the enterprise into a cause-worth-committing-to

is a primary task of the leader.

G.H.: “Create a ‘cause,’ not a ‘business.’ ”

“I never, ever thought of myself

as a businessman. I was interested in creating

things I would be proud of.” —Richard Branson

CEO Assignment2002 (Bermuda):

“Please leap forward to 2007, 2012, or 2022, and write a business history of

Bermuda. What will have been said about your company during your

tenure?”

Ah, kids: “What is your vision for the future?” “What have you accomplished since your first book?” “Close your eyes and

imagine me immediately doing something about what you’ve just said. What would it be?”

“Do you feel you have an obligation to ‘Make the world a

better place’?”

“Management has a lot to do with answers. Leadership is a function of questions. And the

first question for a leader always is: ‘Who do we

intend to be?’ Not ‘What are we going to do?’ but ‘Who do

we intend to be?’” —Max DePree, Herman Miller

Demo = Story

“A key – perhaps the key – to leadership is the

effective communication of a story.”

Howard Gardner, Leading Minds: An Anatomy of Leadership

Good to Great: Fannie Mae … Kroger … Walgreens … Philip

Morris … Pitney Bowes … Abbott … Kimberly-Clark … Wells Fargo

AGENDA SETTERS: “Set the Table”/ Pioneers/ Questors/ Adventurers

US Steel … Ford … Macy’s … Sears … Litton Industries … ITT … The Gap … Limited … Wal*Mart … P&G … 3M …

Intel … IBM … Apple … Nokia … Cisco … Dell … MCI … Sun … Oracle …

Microsoft … Enron … Schwab … GE … Southwest … Laker …People Express

… Ogilvy … Chiat/Day … Virgin … eBay … Amazon … Sony … BMW … CNN …

Huh?

“Quiet, workmanlike, stoic leaders bring about the big

transformations.”--JC

Huh?

“Humility: The Surprise Factor in Leadership … bosses with Gung-

ho Qualities and Charisma May Be Out of Fashion” —Headline/FT/

re JCollins/10.03 (TP: scribble: “Nelson, Wellington, Montgomery, Disraeli, Churchill, Thatcher”)

Pastels?

T. Paine/P. Henry/A. Hamilton/T. Jefferson/B. FranklinA. Lincoln/U. S. Grant/W. T. Sherman

TR/FDR/LBJ/RR/JFKM.L. King

C. de GaulleM. Gandhi

W. ChurchillM. Thatcher

PicassoMozart

Copernicus/Newton/EinsteinJ. Welch/L. Gerstner/L. Ellison/B. Gates/S. Ballmer/S. Jobs/

S. McNealyA. Carnegie/J. P. Morgan/H. Ford/J.D. Rockefeller/T. A. Edison

“rough … sarcastic …

bullying”

WE WILL SUCCEED TO THE EXTENT THAT OUR TEAM

“CAN’T WAIT FOR THE WEEKEND TO END.” WE AIM TO

DENT THE UNIVERSE! (Scale of 1 t0 10?)

The Leadership11


The Leadership11

Passion Management

Passion moves mountains. Creating a “passionate enterprise” is a modern leadership imperative.

“A leader is a dealer in hope.”

Napoleon

(+TP’s writing room pics)

Hackneyed but none the less

true: LEADERS SEE CUPS AS “HALF

FULL.”

Half-full Cups: “[Ronald Reagan] radiated an almost transcendent

happiness.”Lou Cannon, George (08.2000)

BZ: “I am a … Dispenser of Enthusiasm!”

“You can’t behave in a calm, rational manner.

You’ve got to be out there on the lunatic fringe.” — Jack

Welch, on GE’s quality program

Message: Leadership is all about love! [Passion, Enthusiasms, Appetite for Life,

Engagement, Commitment, Great Causes & Determination to Make a

Damn Difference, Shared Adventures, Bizarre Failures, Growth, Insatiable

Appetite for Change.] [Otherwise, why bother? Just read Dilbert. TP’s final words: CYNICISM SUCKS.]

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

simple. It was something like, ‘Burger King is 250,000 people, every one of

whom gives a shit.’ Every one. Accounting. Systems. Not just the drive through. Everyone is ‘in the brand.’ That’s what we’re talking

about, nothing less.”— Barry Gibbons

T. J. Peters T. J. Peters 1942 – 2---1942 – 2---

HE WOULDA DONE SOME HE WOULDA DONE SOME

REALLY COOL STUFF REALLY COOL STUFF

BUT …BUT …

HIS BOSS WOULDN’T HIS BOSS WOULDN’T

LET HIM! LET HIM!

T. J. Peters T. J. Peters 1942 – 2---1942 – 2---

HE WAS A PLAYER!HE WAS A PLAYER!

“If you ask me what I have come to do in this

world, I who am an artist, I will reply: I am here to live my life out

loud.” — Émile Zola

“May you live all the days of

your life.” — Jonathan Swift

The Re-imagineer’s Credo … or, Pity the Poor Brown*

Technicolor Times demand …Technicolor Leaders and Boards who recruit …

Technicolor People who are sent on …Technicolor Quests to execute …

Technicolor (WOW!) Projects in partnership with …Technicolor Customers and …

Technicolor Suppliers all of whom are in pursuit of …Technicolor Goals and Aspirations fit for …

Technicolor Times.

*WSC

Successful Businesses’ Dozen Truths: TP’s 30-Year Perspective

1. Insanely Great & Quirky Talent.2. Disrespect for Tradition.3. Totally Passionate (to the Point of Irrationality) Belief in What We Are Here to Do.4. Utter Disbelief at the Bullshit that Marks “Normal Industry Behavior.”5. A Maniacal Bias for Execution … and Utter Contempt for Those Who Don’t “Get It.”6. Speed Demons.7. Up or Out. (Meritocracy Is Thy Name. Sycophancy Is Thy Scourge.)8. Passionate Hatred of Bureaucracy.9. Willingness to Lead the Customer … and Take the Heat Associated Therewith. (Mantra: Satan Invented Focus Groups to Derail True Believers.)10. “Reward Excellent Failures. Punish Mediocre Successes.” 11. Courage to Stand Alone on One’s Record of Accomplishment Against All the Forces of Conventional Wisdom.12. A Crystal Clear Understanding of Brand Power.

Kevin Roberts’ Credo

1. Ready. Fire! Aim.2. If it ain’t broke ... Break it!3. Hire crazies.4. Ask dumb questions.5. Pursue failure.6. Lead, follow ... or get out of the way!7. Spread confusion.8. Ditch your office.9. Read odd stuff.10. Avoid moderation!

Sir Richard’s Rules:

Follow your passions.Keep it simple.

Get the best people to help you.Re-create yourself.

Play.

Source: Fortune/10.03

“In Tom’s world, it’s always better to try a swan dive and deliver a colossal belly flop than to step timidly off the board while holding your

nose.” —Fast Company /October2003

I AM AN … ENTHUSIAST. MY ENTHUSIAM IS CONTAGIOUS. WE

HAVE FUN. WE AIM TO GO ON “QUESTS” AND CHANGE THE

WORLD. THAT IS MY COMMITMENT. THAT IS MY

LEGACY. THAT IS MY (LOUD)

LIFE. (Scale of 1 to 10?)

The Leadership11


re-imagine’s requisites : the leadership 11 tom peters/04.01.2004

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