Tom Peters’Tom Peters’

Excellence.Excellence.Always.Always.

Management ForumManagement ForumBogota/16 March 2009Bogota/16 March 2009

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

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

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

andand “Verdana”“Verdana”

Slides at …Slides at …

tompeters.comtompeters.com

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

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

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

His immediate answer …His immediate answer …

““remember remember to tuck the to tuck the

shower curtain shower curtain inside the inside the bathtubbathtub””

““Execution Execution isis

strategy.”strategy.” —Fred Malek—Fred Malek

MBWMBWAA

Message from a banker, circa 1988:Message from a banker, circa 1988: “Tom let “Tom let me tell you the definition of a me tell you the definition of a

good lending officer. After good lending officer. After church on Sunday, on the way church on Sunday, on the way home with his family, he takes home with his family, he takes a little detour to drive by the a little detour to drive by the factory he just lent money to. factory he just lent money to.

Doesn’t go in or any suchDoesn’t go in or any such thing, just drives by and thing, just drives by and

takes a look.”takes a look.”

““Too Much Cost, Not Enough Value” … “Too Too Much Cost, Not Enough Value” … “Too Much Speculation, Not Enough Investment” … Much Speculation, Not Enough Investment” … “Too Much Complexity, Not Enough Simplicity” “Too Much Complexity, Not Enough Simplicity” … “Too Much Counting, Not Enough Trust” … … “Too Much Counting, Not Enough Trust” …

“Too Much Business Conduct, Not Enough “Too Much Business Conduct, Not Enough Professional Conduct” … “Too Much Professional Conduct” … “Too Much

Salesmanship, Not Enough Stewardship” … Salesmanship, Not Enough Stewardship” … “Too Much Focus on Things, Not Enough Focus “Too Much Focus on Things, Not Enough Focus

on Commitment” … “Too Many Twenty-first on Commitment” … “Too Many Twenty-first Century Values, Not Enough Eighteenth-Century Values, Not Enough Eighteenth-

Century Values” … “Too Much ‘Success,’ Not Century Values” … “Too Much ‘Success,’ Not Enough Character” Enough Character” —chapter titles from John Bogle, —chapter titles from John Bogle, Enough. The Measures of Money, Business, and LifeEnough. The Measures of Money, Business, and Life (Bogle is (Bogle is

founder of the Vanguard Mutual Fund Group)founder of the Vanguard Mutual Fund Group)

Good News 2009:Good News 2009: Leadership*Leadership* is a sacred is a sacred

trust.trust.*President, classroom teacher, CEO, shop foreman*President, classroom teacher, CEO, shop foreman

19821982

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

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

““Breakthrough” 82*Breakthrough” 82*

People! People! CustomersCustomers

! ! Action! Action! Values! Values!

**In Search of ExcellenceIn Search of Excellence

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

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

relationships)relationships)

20072007SiberiaSiberia

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

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

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

20072007SydneSydne

yy

Organizations Organizations existexist to to serveserve. Period.. Period.

Leaders Leaders live live toto serveserve. Period.. Period.

… … no less than no less than CathedralsCathedrals

in which the full and in which the full and awesome power of the awesome power of the

Imagination and Spirit and Imagination and Spirit and native Entrepreneurial flairnative Entrepreneurial flair

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

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

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

dreamed of beingdreamed of being.”.” ——Robert Altman, Oscar acceptance speechRobert Altman, Oscar acceptance speech

The Dream ManagerThe Dream Manager —Matthew Kelly—Matthew Kelly

“An organization can only become the-best-“An organization can only become the-best-version-of-itself to the extent that the people version-of-itself to the extent that the people

who drive that organization are striving to who drive that organization are striving to become better-versions-of-themselves.”become better-versions-of-themselves.”

The question is: The question is: What is an employee’s purpose? What is an employee’s purpose? Most would say, ‘to help the company achieve Most would say, ‘to help the company achieve its purpose’—but they would be wrong. That is its purpose’—but they would be wrong. That is certainly part of the employee’s role, but an certainly part of the employee’s role, but an

employee’s primary purpose is to become the-employee’s primary purpose is to become the-best-version-of-himself or –herself. …best-version-of-himself or –herself. … Our Our

employees are our first customers, and our employees are our first customers, and our most important customers.”most important customers.”

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

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

complete answer, upon being asked his “secrets to success”complete answer, upon being asked his “secrets to success”

Source: Joe Nocera, Source: Joe Nocera, NYTNYT, “Parting Words of an Airline Pioneer,” on the occasion , “Parting Words of an Airline Pioneer,” on the occasion of Herb Kelleher’s retirement after 37 years at Southwest Airlines (SWA’s pilots of Herb Kelleher’s retirement after 37 years at Southwest Airlines (SWA’s pilots

union took out a full-page ad in USA Today thanking HK for all he had done; union took out a full-page ad in USA Today thanking HK for all he had done; across theacross the

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

““We are a We are a ‘Life ‘Life

Success’ Success’ Company.”Company.”

Dave Liniger, founder, RE/MAX

““Managing winds up being Managing winds up being the management of the the management of the allocation of resources allocation of resources

against tasks. Leadership against tasks. Leadership focuses on people. focuses on people. MMyy definition of a leader is definition of a leader is

someone who helsomeone who helpps s ppeoeopple le succeedsucceed.”.” —Carol Bartz, Yahoo! —Carol Bartz, Yahoo!

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

organizationorganization

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

Source: courtesy Dave Wheeler, posted atSource: courtesy Dave Wheeler, posted at tompeters.com, source of original unknown (0609.08) tompeters.com, source of original unknown (0609.08)

1818””

““Buy in”- Buy in”- “Ownership”-“Ownership”-

Authorial bragging Authorial bragging rights-“Born again” rights-“Born again”

Champion = Champion = OneOne LineLine ofof CodeCode!!

““The deepest The deepest human need is human need is the need to be the need to be appreciated.”appreciated.”

William JamesWilliam James

““Leaders Leaders

‘‘SERVESERVE’’ people. people.

Period.”Period.” —inspired by Robert Greenleaf

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

or it's simor it's simppllyy not not worth doinworth doing.”g.” —Richard Branson—Richard Branson

Ben Ben Changes Changes

His BHAG!*His BHAG!*

*Big Hairy Audacious Goal/Collins*Big Hairy Audacious Goal/Collins

TP: TP: “How to flush

$500,000 down

the toilet in one easy

lesson!!”

< CAPEX< CAPEX> People!> People!

WegmansWegmans

Our Mission

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

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

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

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

WPP

Brand Brand = =

Talent.Talent.

Some likeSome like it hot! it hot!

““Insanely Insanely Great”Great”

““Radically Radically thrilling”thrilling”

BMW

dubaidubai

Single Single greatest act greatest act

of pure of pure imaginationimagination

Pursuing Pursuing

Discomfort!Discomfort!

““Do one Do one thing every thing every

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

—Eleanor Roosevelt

Kevin Roberts’ CredoKevin Roberts’ Credo

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

10. Avoid moderationAvoid moderation!!

““You miss You miss

100100%%

of the shots of the shots you never you never

take.”take.” —Wayne—Wayne GretzkyGretzky

#1 Truthteller …#1 Truthteller …

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

““I used to have a rule for myself that at any point in I used to have a rule for myself that at any point in time I wanted to have in mind time I wanted to have in mind — as it so happens, — as it so happens, also in writing, on a little card I carried around with also in writing, on a little card I carried around with me — the three big things I was trying to get done. me — the three big things I was trying to get done.

ThreeThree..

Not two. Not two. Not four. Not four. Not five.Not five.Not ten.Not ten.Three.”Three.”

— Richard Haass, — Richard Haass, The Power to PersuadeThe Power to Persuade

““Dennis, you need a … Dennis, you need a …

‘To-don’t ‘To-don’t ’’ List !” List !”

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

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

Gandhi

““I am a dispenser I am a dispenser of enthusiasm.” *of enthusiasm.” *

—Ben Zander

*Especially in tough times!

““To develop others, To develop others, start with yourself.”start with yourself.”

—Marshall Goldsmith—Marshall Goldsmith

Halt.Halt. Do. It. Do. It. Now. Now.

--1%1%

Skip the mapSkip the map

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

or …or …

1. Have you in 1. Have you in thethe last 10 days … last 10 days … visited a visited a customecustomer?r?2. Have you called 2. Have you called aa customer … customer … TODAYTODAY??

The “Have The “Have you …” 50you …” 50

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

3. Have you in the last 60-90 days … had a seminar in which several folks from the 3. Have you in the last 60-90 days … had a seminar in which several folks from the customer’s operation (different levels, different functions, different divisions) interacted, customer’s operation (different levels, different functions, different divisions) interacted, via facilitator, with various of your folks?via facilitator, with various of your folks?

4. 4. Have you thanked a front-line employee for a Have you thanked a front-line employee for a small act of helpfulness … in the last three days?small act of helpfulness … in the last three days?5. Have you thanked a front-line employee for a small act of helpfulness … in the 5. Have you thanked a front-line employee for a small act of helpfulness … in the last three last three hourshours??6. Have you thanked a frontline employee for carrying around a great 6. Have you thanked a frontline employee for carrying around a great attitude attitude … today?… today?7. Have you in the last week recognized—publicly—one of your folks for a small act of 7. Have you in the last week recognized—publicly—one of your folks for a small act of cross-functional co-operationcross-functional co-operation??8. Have you in the last week recognized—publicly—one of “their” folks (another 8. Have you in the last week recognized—publicly—one of “their” folks (another function) for a small act of cross-functional co-operation?function) for a small act of cross-functional co-operation?9. Have you invited in the last month a leader of 9. Have you invited in the last month a leader of another functionanother function to your weekly team to your weekly team priorities meeting?priorities meeting?10. Have you personally in the last week-month called-visited an internal or external 10. Have you personally in the last week-month called-visited an internal or external customer to customer to sort out, inquire, or apologizesort out, inquire, or apologize for some little or big thing that went awry? for some little or big thing that went awry? (No reason for doing so? If true—in your mind—then you’re more out of touch than I (No reason for doing so? If true—in your mind—then you’re more out of touch than I dared imagine.)dared imagine.)

BIG?

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

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

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

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

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

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

#4 Japan#4 Japan#2T USA#2T USA

#2T China#2T China

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

#2 China#2 China

#1 #1 GermanyGermany

Reason!!!Reason!!!

MittelstandMittelstand

Jim’s Jim’s GroupGroup

Jim’s Mowing CanadaJim’s Mowing CanadaJim’s Mowing UKJim’s Mowing UKJim’s AntennasJim’s Antennas

Jim’s BookkeepingJim’s BookkeepingJim’s Building MaintenanceJim’s Building Maintenance

Jim’s Carpet CleaningJim’s Carpet CleaningJim’s Car CleaningJim’s Car Cleaning

Jim’s Computer ServicesJim’s Computer Services

Jim’s Dog WashJim’s Dog WashJim’s Driving SchoolJim’s Driving School

Jim’s FencingJim’s FencingJim’s FloorsJim’s Floors

Jim’s PaintingJim’s PaintingJim’s PavingJim’s Paving

Jim’s Pergolas [gazebos]Jim’s Pergolas [gazebos]Jim’s Pool CareJim’s Pool Care

Jim’s Pressure CleaningJim’s Pressure CleaningJim’s RoofingJim’s Roofing

Jim’s Security DoorsJim’s Security DoorsJim’s TreesJim’s Trees

Jim’s Window CleaningJim’s Window CleaningJim’s WindscreensJim’s Windscreens

Note: Download, free, Jim Penman’s book: What Will They Franchise Next? The Story of Jim’s Group

1/401/40

try it. Try it. Try it. try it. Try it. Try it. Try it. Try it. Try it.Try it. Try it. Try it.

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

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

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

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

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

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

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

studying logs, but you have to drill.”

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

““We made mistakes, of course. Most of them were We made mistakes, of course. Most of them were omissions we didn’t think of when we initially wrote the omissions we didn’t think of when we initially wrote the

software. software. We fixed them by doing it over and over, 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 areBy the time our rivals are

ready with wires and screws, we are on versionready with wires and screws, we are on version

##1010.. It gets back to It gets back to

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

BloombergBloomberg

““Fail .Fail . Forward. Forward.

Fast.”Fast.”High Tech CEO, Pennsylvania

““RewardReward excellent failures.

PunishPunish mediocre

successes.”Phil Daniels, Sydney exec

We AreWe Are What We What We

Eat Eat

We We areare the the companycompany we keepwe keep

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

StaffStaffConsultantsConsultants

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

Innovation Alliance PartnersInnovation Alliance PartnersCustomersCustomers

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

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

IS/IT ProjectsIS/IT ProjectsHQ LocationHQ LocationLunch MatesLunch Mates

LanguageLanguageBoardBoard

Axiom: Never use a vendor who is not in the

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

spending!*

*Inspired by Hummingbird

““[CEO A.G.] Lafley has shifted [CEO A.G.] Lafley has shifted P&G’sP&G’s focus on inventing all its own focus on inventing all its own

products to developing products to developing

others’ others’ inventions at inventions at least half the least half the timetime.. One successful One successful

example Mr. Clean Magic Eraser, example Mr. Clean Magic Eraser, based on a product found in anbased on a product found in an

Osaka market.” Osaka market.” ——FortuneFortune

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

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

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

about: about:

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

““Normal” Normal”

= = “o “o forfor 800”800”

All You Need to Know About All You Need to Know About “Sources of Innovation”:“Sources of Innovation”:

Angry Angry people!people! [angry with [angry with

the status quo]the status quo]

““Diverse groups of problem solvers—groupsDiverse groups of problem solvers—groups of people with diverse tools—consistently of people with diverse tools—consistently outperformed groups of the best and the outperformed groups of the best and the

brightest. If I formed two groups, one brightest. If I formed two groups, one random (and therefore diverse) and one random (and therefore diverse) and one

consisting of the best individual performers, consisting of the best individual performers, the first group almost always did better. …the first group almost always did better. …

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

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

““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, 0110.07, 0110.07

Rob McEwen/CEO/CEO/Goldcorp Inc./Goldcorp Inc./

Red Lake Red Lake goldgoldSource: Wikinomics: How Mass

Collaboration Changes Everything, Don Tapscott & Anthony WilliamsDon Tapscott & Anthony Williams

“The The Bottleneck Bottleneck

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

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

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

AtAt thethe totop!”p!”

— Gary Hamel/Harvard Business Review

Measure it!Measure it!

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

Initiatives/Key Projects score 88 or higher or higher [out of 10] on a

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

Scale?

Iron Innovation Equality Law:Iron Innovation Equality Law:

The quality and The quality and quantity and quantity and

imaginativeness of imaginativeness of innovation shall be innovation shall be

the same in all the same in all functions functions —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.

-Costs-Costs+R&D+R&D

-Costs-Costs+R&D+R&D+Sales+Sales+Marketing+Marketing +Quality+Quality+Thoughtfulness+Thoughtfulness+Excellence+Excellence

XFXXFX

X X =XFX*=XFX*

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

The “XF-50”: 50 Ways to The “XF-50”: 50 Ways to Enhance Cross-Functional Enhance Cross-Functional Effectiveness and Deliver Effectiveness and Deliver

Speed, “Service Speed, “Service Excellence” and “Value-Excellence” and “Value-

added Customer added Customer ‘Solutions’”*‘Solutions’”*

*Entire “XF-50” List is an Appendix to the LONG version *Entire “XF-50” List is an Appendix to the LONG version of this presentation, posted at tompeters.comof this presentation, posted at tompeters.com

Never Never waste a waste a lunch!lunch!

????????

% XF % XF lunches*lunches*

*Measure!*Measure!

Greater Greater than …than …

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

InternetInternet: Economic : Economic Growth Is Driven Growth Is Driven

by by WomenWomen.”.” —Headline,

Economist, April 15, 2006, Leader, page 14

““Women Women areare thethe

majority majority market”market”

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

““The The most most significant variablesignificant variable

inin everyevery sales situation is sales situation is

thethe gendergender of the buyer, of the buyer, and more importantly, how and more importantly, how

the salesperson the salesperson communicates to the communicates to the

buyer’s gender.”buyer’s gender.” —Jeffery Tobias Halter, Selling to Men, Selling to Women

The Perfect Answer

Jill and Jack buy slacks in black…

Cases! Cases! Cases!Cases! Cases! Cases!McDonald’sMcDonald’s (“mom-centered” to “majority consumer”;

not via kids)

Home DepotHome Depot (“Do it [everything!] Herself”)

P&GP&G (more than “house cleaner”)

DeBeersDeBeers (“right-hand rings”/$4B)

AXA FinancialAXA FinancialKodakKodak (women = “emotional centers of the household”)

NikeNike (> jock endorsements; new def sports; majority consumer)

AvonAvonBratzBratz (young girls want “friends,” not a blond stereotype)

Source: Fara Warner/Fara Warner/The Power of the PurseThe Power of the Purse

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

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

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

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

of 13%of 13%.”.” —Economist, April 15

““AS AS LEADERS, LEADERS, WOMEN WOMEN

RULERULE:: New Studies find

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

TITLE/ Special Report/ TITLE/ Special Report/ BusinessWeekBusinessWeek

9494%%

““CEMEX realized that CEMEX realized that women are the kewomen are the keyy drivers drivers

of savinof savinggs ins in [Mexican][Mexican] familiesfamilies.. … They are entrepreneurial in nature, … They are entrepreneurial in nature,

and they actively participate in the tanda system and they actively participate in the tanda system [neighborhood groups who pool money and save any that’s left over].[neighborhood groups who pool money and save any that’s left over].

Regardless of whether they are homemakers or outside-Regardless of whether they are homemakers or outside-the-home workers, they are responsible for any savings in the-home workers, they are responsible for any savings in

the family. Patrimonio Hoy the family. Patrimonio Hoy [Private Property Today, a CEMEX [Private Property Today, a CEMEX

program to aid the poor in building homes]program to aid the poor in building homes] discovered that 70% of discovered that 70% of the women who saved were saving money in the tanda the women who saved were saving money in the tanda

system to construct homes for their families. The men in system to construct homes for their families. The men in the society consider their job done if they bring in their the society consider their job done if they bring in their

paycheck at the end of the day.”paycheck at the end of the day.” —C.K. Prahalad, —C.K. Prahalad, The Fortune at The Fortune at the Bottom of the Pyramidthe Bottom of the Pyramid, on Lorenzo Zambrano and CEMEX, the Mexican , on Lorenzo Zambrano and CEMEX, the Mexican

company that’s the world’s #3 cement makercompany that’s the world’s #3 cement maker

#1#1

““Development can help great Development can help great

people be even better—people be even better— but if but if I had a dollar to I had a dollar to

spend, I’d spend 70 spend, I’d spend 70 cents getting the cents getting the

right person in the right person in the doordoor.”.” ——Paul Russell, Director, Leadership &Paul Russell, Director, Leadership &

Development, Google Development, Google

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

asasppect of businessect of business and yet remains and yet remains

woefully woefully misunderstood.”misunderstood.”

Source: Source: Wall Street JournalWall Street Journal, 10.29.08,, 10.29.08, review ofreview of Who: The A Method for Hiring, Who: The A Method for Hiring,

Geoff Smart and Randy StreetGeoff Smart and Randy Street

#1.#1.StrategicStrategic..Priority.Priority.Period.Period.

#1A#1A

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

Employee retention & satisfaction:Employee retention & satisfaction:

OverwhelminOverwhelminggllyy, , based on the based on the first-first-

line manaline managger!er!

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

#1B#1B

2/year 2/year = =

legacy.legacy.

Tea Tea PowerPower

GiveGive good good tea! tea!

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

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

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

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

future coalition command.”future coalition command.”

Three Three Minutes!Minutes!

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

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

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

REAL PROBLEMREAL PROBLEM.**PERCEPTION IS ALL THERE IS!*PERCEPTION IS ALL THERE IS!

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

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

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

COMPLETE RUPTURE.COMPLETE RUPTURE.

““I regard I regard aappoloologgizinizing as the g as the most magical, healing, most magical, healing,

restorative gesture human restorative gesture human beings can make. It is the beings can make. It is the

centerpiece of my work with centerpiece of my work with executives who want to get executives who want to get better.”better.” —Marshall Goldsmith—Marshall Goldsmith, What Got You , What Got You

Here Won’t Get You There: How Successful People BecomeHere Won’t Get You There: How Successful People Become Even More Successful Even More Successful

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

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

and appreciating heart.”and appreciating heart.”

—Henry Clay

Profitable!Profitable!

““We are We are thoughtful in thoughtful in all we do.”all we do.”

ThoughtfulnessThoughtfulness is key to customer retention. is key to customer retention.ThoughtfulnessThoughtfulness is key to employee recruitment is key to employee recruitment and satisfaction.and satisfaction.Thoughtfulness Thoughtfulness is key to brand perception.is key to brand perception.ThoughtfulnessThoughtfulness is key to your ability to look in is key to your ability to look in the mirror—and tell your kids about your job.the mirror—and tell your kids about your job.

““ThoughtfulnessThoughtfulness is free.” is free.”ThoughtfulnessThoughtfulness is key to speeding things up— is key to speeding things up— it reduces friction.it reduces friction.ThoughtfulnessThoughtfulness is key to transparency and is key to transparency and eveneven cost containment—it abets rather than stiflescost containment—it abets rather than stifles truth-telling.truth-telling.

nonenone!!

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 atisfaction referred to patient’s health health outcomeoutcome

P.S.P.S. directldirectly related to y related to StaffStaff InteractionInteraction

P.P.S.P.P.S. directldirectly correlated with y correlated with EmploEmployyee ee SatisfactionSatisfaction

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

““KindnesKindness is s is

free.”free.”

TGRTGR

2-cent 2-cent candycandy

Commerce Bank: From “Service” to Commerce Bank: From “Service” to “Experience”“Experience”

7X. 730A-7X. 730A-800P. F12A.800P. F12A.

““Experiences Experiences are as distinct are as distinct

from services as from services as services are from services are from goods.”goods.” —Joe Pine & Jim Gilmore, The

Experience Economy: Work Is Theatre & Every Business a Stage

<TG<TGWWvs.vs.

>TG>TGRR[Things Gone [Things Gone WRONGWRONG/Things Gone /Things Gone RIGHTRIGHT]]

Hypothesis:Hypothesis: DESIGNDESIGN is is the pthe princirincippalal

differencedifference between between lovelove

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

Small Small

is (can often be)is (can often be)

BIGBIG

““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

Behavioral Primacy!

E.g.: plate size; E.g.: plate size; location of platters, location of platters,

6.56.5 feet Away = feet Away =

--6363% % “Seconds” “Seconds”

Source: Brian Wansink, Source: Brian Wansink, Mindless EatingMindless Eating

Socks = Socks = 10K10K

““Paint it Paint it white!”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 reduce assumptions, it could reduce 44 billion tons of44 billion tons of CO2 emissionsCO2 emissions by cooling buildings, roads, entire cities by cooling buildings, roads, entire cities

((The GuardianThe Guardian, 0116.09), 0116.09)

Seating arrangementSeating arrangement

Table shapeTable shapePhysical arrangements (distance,Physical arrangements (distance, co-location, grand or not/Apple)co-location, grand or not/Apple)

Geologists/GeophysicistsGeologists/GeophysicistsXFX/Cross-functional ExcellenceXFX/Cross-functional Excellence (meetings, talks, etc)(meetings, talks, etc)““The hang out axiom” (“We areThe hang out axiom” (“We are what we eat.”)what we eat.”)See greenery, recover faster (map,See greenery, recover faster (map, smell of cookies, pianos/smell of cookies, pianos/ Planetree)Planetree)Vary road crossing times/engageVary road crossing times/engage

Stew/Wrapped and loose fish/2XStew/Wrapped and loose fish/2XStew/No exit aislesStew/No exit aisles

Wal*Mart/Oversized cartsWal*Mart/Oversized cartsCoins with likenessesCoins with likenessesPost Office architecturePost Office architecturePat visits the Local presidentPat visits the Local presidentThom Mayer and the crossed armsThom Mayer and the crossed arms““Management” of body languageManagement” of body language (2/3rds of communication)(2/3rds of communication)

DifficultDifficult Times … Times …

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

anxious to win”anxious to win”

The greatest dangerThe greatest dangerfor most of usfor most of us

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

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

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

Michelangelo

Excellence.Excellence.Always.Always.

““Mr. Watson, Mr. Watson, how long does it how long does it take to achieve take to achieve

Excellence?”Excellence?”

““11 minute”minute”

The RealThe Real Deal Deal

The Heart of The Heart of Business Strategy: Business Strategy:

48 Things That 48 Things That MatterMatter

We usually think of business We usually think of business strategy as some sort of aspirational strategy as some sort of aspirational

market positioning statement. market positioning statement. Doubtless that’s part of it. But I Doubtless that’s part of it. But I

believe that the number one believe that the number one “strategic strength” is excellence in “strategic strength” is excellence in execution and systemic relationships execution and systemic relationships

(i.e., with everyone we come in (i.e., with everyone we come in contact with). Hence I offer the contact with). Hence I offer the following 48 pieces of advice in following 48 pieces of advice in

creating a winning “strategy” that is creating a winning “strategy” that is inherently sustainable.inherently sustainable.

““Thank you.” Minimum several times a day.Thank you.” Minimum several times a day. Measure it.Measure it.““Thank you” to everyone even peripherallyThank you” to everyone even peripherally involved in some activity—especially involved in some activity—especially thosethose “ “deep in the hierarchy.”deep in the hierarchy.”Smile. Work on it.Smile. Work on it.Apologize. Even if “they” are “mostly” toApologize. Even if “they” are “mostly” to blame.blame.Jump all over those who play the “blameJump all over those who play the “blame game.” game.” Hire enthusiasm.Hire enthusiasm.Low enthusiasm. No hire. Any job.Low enthusiasm. No hire. Any job.Hire optimists. Everywhere. (“Positive Hire optimists. Everywhere. (“Positive outlook on life,” not mindless optimism.)outlook on life,” not mindless optimism.)Hiring: Would you like to go to lunch withHiring: Would you like to go to lunch with him-her. 100% of jobs.him-her. 100% of jobs.

Hire for good manners.Hire for good manners.Do not reject “trouble makers”—that is thoseDo not reject “trouble makers”—that is those who are uncomfortable with the status who are uncomfortable with the status quo.quo.Expose all would-be hires to somethingExpose all would-be hires to something unexpected-weird. Observe their reaction.unexpected-weird. Observe their reaction.Overwhelm response to even the smallestOverwhelm response to even the smallest screw-ups.screw-ups.Become a student of all you will meet with. Become a student of all you will meet with. Big time.Big time.Hang out with interesting new people. Hang out with interesting new people. Measure it.Measure it.Lunch with folks in other functions. Measure Lunch with folks in other functions. Measure it.it.Listen. Hear. Become a serious studentListen. Hear. Become a serious student of listening-hearing.of listening-hearing.Work on everyone’s listening skills. Practice.Work on everyone’s listening skills. Practice.

Become a student of information extraction-Become a student of information extraction- interviewing.interviewing.Become a student of presentation giving.Become a student of presentation giving. Formal. Short and spontaneous.Formal. Short and spontaneous.Incredible care in 1st line supervisor Incredible care in 1st line supervisor selection.selection.World’s best training for 1st line supervisors.World’s best training for 1st line supervisors.Construct small leadership opportunities forConstruct small leadership opportunities for junior people within days of starting on thejunior people within days of starting on the job.job.Insane care in all promotion decisions.Insane care in all promotion decisions.Promote “people people” for all managerialPromote “people people” for all managerial jobs. Finance-logistics-R&D as much as,jobs. Finance-logistics-R&D as much as, say, sales.say, sales.Hire-promote for demonstrated curiosity. Hire-promote for demonstrated curiosity. Check their past commitment to continuousCheck their past commitment to continuous learning.learning.

Small “d” diversity. Rich mixes for any andSmall “d” diversity. Rich mixes for any and all teams. all teams. Hire women. Roughly 50% women on execHire women. Roughly 50% women on exec team.team.Exec team “looks like” customer population,Exec team “looks like” customer population, actual and desired.actual and desired.Focus on creating products for and sellingFocus on creating products for and selling to women.to women.Focus on creating products for and sellingFocus on creating products for and selling to boomers-geezers.to boomers-geezers.Work on first and last impressions.Work on first and last impressions.Walls display tomorrow’s aspirations, notWalls display tomorrow’s aspirations, not yesterday’s accomplishments.yesterday’s accomplishments.Simplify systems. Constantly.Simplify systems. Constantly.

Insist that almost all material be covered by aInsist that almost all material be covered by a 1-page summary. Absolutely no longer. 1-page summary. Absolutely no longer. Practice decency.Practice decency.Add “We are thoughtful in all we do” toAdd “We are thoughtful in all we do” to corporate values list. Number 1 force forcorporate values list. Number 1 force for customer loyalty, employee satisfaction.customer loyalty, employee satisfaction.Make some form of employee growth (for all)Make some form of employee growth (for all) a formal part of values set. Abovea formal part of values set. Above customer satisfaction. Steal from RE/MAX: customer satisfaction. Steal from RE/MAX: “We are a life success company.”“We are a life success company.”Flowers.Flowers.Celebrate “small wins.” Often. Perhaps aCelebrate “small wins.” Often. Perhaps a “ “small win of the day.”small win of the day.”

Manage your calendar religiously: Does itManage your calendar religiously: Does it accurately reflect your espoused priorities?accurately reflect your espoused priorities? Use a “calendar friend” who’s not veryUse a “calendar friend” who’s not very friendly to help you with this.friendly to help you with this.Review your calendar: Work assiduously andReview your calendar: Work assiduously and mercilessly on your “To don’ts.”—stuff mercilessly on your “To don’ts.”—stuff that distracts.that distracts.Bosses, especially near the top: FormallyBosses, especially near the top: Formally cultivate one advisor whose role is to tell cultivate one advisor whose role is to tell youyou the truth. the truth. Commit to Excellence.Commit to Excellence.Talk up Excellence. Talk up Excellence. Put “Excellence in all we do” in the values Put “Excellence in all we do” in the values set.set.Measure everyone on demonstratedMeasure everyone on demonstrated commitment to Excellence.commitment to Excellence.