Category: Strategies

Enough.

Jack Bogle, the Vanguard Group founder (Vanguard has $3 trillion in assets under management), wrote in 2008 a marvelous book titled Enough. I offer here the chapter titles:

"Too Much Cost, Not Enough Value"
"Too Much Speculation, Not Enough Investment"
"Too Much Complexity, Not Enough Simplicity"
"Too Much Counting, Not Enough Trust"
"Too Much Business Conduct, Not Enough Professional Conduct"
"Too Much Salesmanship, Not Enough Stewardship"
"Too Much Focus on Things, Not Enough Focus on Commitment"
"Too Many Twenty-first Century Values, Not Enough Eighteenth-Century Values"
"Too Much 'Success,' Not Enough Character"

Not much more to be said, eh?

(Here's the genesis of the title: "At a party given by a billionaire on Shelter Island, Kurt Vonnegut informs his pal, Joseph Heller, that their host, a hedge fund manager, had made more money in a single day than Heller had earned from his wildly popular novel Catch-22 over its whole history. Heller responds ... 'Yes, but I have something he will never have ... ENOUGH.'" FYI: The book title is Enough.—that is, enough, period.)

Reading!

The interviewer at strategy+business magazine, Theodore Kinni, got more than he'd asked for when he called Tom to talk about his four favorite books. The result is a roadmap for your reading strategy en route to business acumen and, ultimately, success: "Tom Peters Wants You to Read."

Six Sustaining—and Very Dangerous—Myths

A 65-slide PowerPoint is attached. It is derived from six fairly recent—and thoroughly researched—books on six key management/organization effectiveness areas where myth typically triumphs over reality.

The myths:

1. Star CEOs drive big enterprise performance differences.
2. CEOs must maximize shareholder value.
3. Stars are stars and maintain their stellar performance in new settings.
4. It's 2015, dude; speed trumps patience.
5. Introverts are by and large not my cup of tea; hey, noisy times call for noisy people.
6. I’ve been around the block; I can figure most things out.

The books:

*Michael Dorff, Indispensable and Other Myths
*Lynn Stout, The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public
*Boris Groysberg, Chasing Stars: The Myth of Talent and the Portability of Performance
*Frank Partnoy, Wait: The Art and Science of Delay
*Susan Cain, Quiet: The Power of Introverts in a World That Can’t Stop Talking
*Daniel Kahneman, Thinking, Fast and Slow

(Note: To state the obvious, the attached PowerPoint does not do justice to the depth and breadth of the research findings. It is provided as no more and no less than a "teaser.")

“Innovation Is Strategy”:
Imperative #1 for the Crazy World of 2015/2015+

I'm labeling what follows a "précis" of my current concerns. It originated with a client request for projected "takeaways" associated with a forthcoming speech. I responded, as requested, with a single page. Then, more or less for the hell of it, I expanded the outline/précis to a 2,000* word short essay (PDF and PPT also).

Herewith FYI:

*It's been said a million times, but it must be repeated: The pace of change is unprecedented—and staggering. Robotics, genetics, artificial intelligence, and nanotechnology, among other things, are literally "changing everything." White-collar work can be augmented (IA/Intelligence Augmented), but high-end white-collar jobs by the tens of millions are under threat (AI/Artificial Intelligence). Robots to vacuum the living room floor are terrific, but roboticized war via "autonomous drones" is too gruesome to contemplate. "Designer babies" (and other genetic "miracles") may result in extraordinary healthcare advances—but may also introduce the stuff of wild-eyed science fiction. Our organizations—and nations—must take all this into account. The world will change shape—for better, and for worse. And it's happening more or less in a flash. Leading physicist Albert Bartlett goes so far as to suggest, "The greatest shortcoming of the human race is our inability to understand the exponential function."

*From a business—and, for that matter, government—perspective, there is, in a sense, only one overarching strategy: constant, high-speed innovation. The likes of efficiency and top quality are imperative for every enterprise—and the achievement thereof is hardly a small thing. (It's one damn big thing!) But that's "table stakes" in 2015/2015+. The (only) winning hand for one and virtually all is an organization designed from top to bottom as a de facto "innovation machine." In three words: "Innovation is strategy."

*A "culture of innovation" must be embedded and nurtured by top management and made central to every leadership position. Who are the organization's innovators? EVERYONE. (Or else.) A culture of innovation turns every organizational unit—from 6 to 6,666—into a school house, a learning machine, a buzzing, blooming experimental laboratory. (FYI: It goes without saying, implementing and sustaining such a culture is a daunting task in most organizations—it requires daily attention, more or less forever.)

*Simple as it is to say, but ever so hard to instill, there is a "big secret," and it is "Whoever tries the most things wins." "Move fast, break things" is Facebook's mantra—and it must become the mantra of all of us. Translation: Literally everyone must be trying and testing "new stuff" every day. There is an uncomfortable corollary to this, captured in the title of a recent book, The Paradox of Innovation: Whoever Makes the Most Mistakes Wins. To try a lot necessarily means to fail a lot—leaders must understand this and make it a centerpiece of the strategy and culture of the organization. "Good tries" that fail are to be celebrated, not punished or hidden. And hustle on an unprecedented scale should go without saying.

*Almost as important as lots of good tries is diversity. That is, every business unit must become a bubbling, "crazy" mix of views and backgrounds and tastes, feature constant intersection with outsiders of every flavor—constant contact with those who make us uncomfortable. Side by side with this bubbling cauldron is a "culture of curiosity." We only want team members—in every position—who question every thing every day, keep asking more and better questions—then, of course, tying it all to those constant tries.

*We are citizens of the world—the world is our source of playmates. The new technologies allow us to play with and partner with, day in and day out, practically everyone on the planet. Our source of ideas and partners is "everybody, everywhere." This approach is "not optional."

*Social media is everybody's "game." One social media baron said, "It takes 20 years to build a reputation, five minutes to lose it." (True.) And a big-firm financial services CEO said he would rather have a single direct twitter conversation with a customer than spend millions on a Super Bowl ad. (Sensible circa 2015.) Add a dozen like, "radical" assertions and you have this: (1) Social media is ubiquitous—and is everybody's business. (2) Stay as near the forefront as you can—and get personally engaged. Big Time. Best time to start this journey? Today.

*There are two giant, still under-served markets: Women (who buy everything) and "oldies" (who have all the money). Women make the large lion's share of purchasing decisions—of commercial as well as consumer products and services. (Re the latter, in the U.S., for example, over 50% of purchasing professionals are women.) Every aspect of the organization—from strategic planning to R&D to after-sales service should be designed for and take direct aim at the still oft-ignored women's market. Likewise, the population is aging at an incredible rate; and the "oldies" have more or less all the discretionary income—to say their needs are under-served is gross understatement. What's at stake? For one thing, the women's market worldwide is an estimated $28,000,000,000,000.

*"Design" is an attitude, not prettification—and it has universal application. With Apple as our role model, we finally understand that "design pays (b-i-g time)." Both aesthetics and user-friendliness rule. But design consciousness that matters is not an afterthought or "add on." It should infect every decision. And, make no mistake, design consciousness applies to an 8-person training department as much as to a retail outlet!

*Little is as good as big, maybe better. Innovation over the long haul rarely if ever comes from enormous "breakthrough ideas." Steve Jobs never "invented" anything. He took extant ideas and polished and polished and polished some more and perfected and repurposed them until, eventually, something magical emerged. Also, and perhaps even more important, time and again (if you're trying enough stuff quickly enough), a tiny twist or turn will yield gargantuan results—e.g., change the entrance road into a Vegas casino from a harsh 90-degree turn to a gently curved road and the number of people who come to the casino doubles! Walmart significantly increases shopping cart size and small-appliance sales shoot up by 50%! (I could add 100 more similar eye-popping stories if I had the space.)

*Little beats big: Like it or not, our giant firms are rarely our best innovators. It's our SMEs/Small and Medium-sized Enterprises that spearhead innovation and carry the weight of sustainable economic progress. We must support these firms in every way imaginable, from funding availability to development of large-scale innovation incubators to instilling a national proclivity for entrepreneurial efforts. (FYI: In the U.S., women-owned venture-financed startups outperform—finance, growth—male-owned startups.)

*Little-within-big. The "death of hierarchy" is unlikely—and even unwanted. There must be a structure of accountability in any complex operation. On the other hand, much/most of the work in today's organizations will be done by project teams, project teams with a mishmash of members from all over the map, collections/collages of project teams, and constantly re-forming sets of project teams. Developing and sustaining a fluid organizational "structure" that allows these teams to be rapidly generated, change shape, and disappear—without losing the capability to execute and finish the job—is a major and challenging chore.

*"Sweat the details." An old boss of mine in the White House in the '70s said, "Execution is strategy." Great ideas need polishing and polishing—and polishing. It ain't over until the last 1%% is in place. Or consider this: A hotel is only as good as the efforts of the housekeeping staff; lousy housekeeping and a poor customer attitude on the part of front-line employees in general can torpedo a $100,000,000 hotel investment in a perfect location. (FYI: One retail genius said, "Remember, your customers can never be any happier than your employees.")

*Needless to say (but it always needs saying—and then saying again and again), capturing and keeping an energized, empowered, engaged, growing workforce is the bedrock of all the above. "Putting people first" must stop being a slogan—and become everyday reality and agenda item #1 in every organization of every size; the payoff is staggering, from retail to biotech. Training and development—with a passion and a big budget—are the bedrock of the bedrock; as one executive put it, "Why go berserk over training? Greed—it pays off in spades." (E.g., when the financial crisis hit, the Container Store, voted the top company to work for in America a couple of years back, doubled rather than cut the front-line training budget in order to increase the sales tickets from the lesser number of customers coming in the door. It worked. And yes, I did just say that a middle-market retailer, not Google or one of its sexy peers, was the %1 USA company to work for.)

*Women are the best leaders: Toward "gender balance" and more. The evidence accumulates: Women are the most effective leaders. A study reported recently in the Harvard Business Review determined that women top men on 12 of 16 key leadership traits—including "hard 'male' stuff" like goal setting and "results orientation." A McKinsey study showed that boards of giant companies with gender balance had 56% more operating profit than the male-dominated flavor that, alas, remains the norm. It is so so absurd not to act decisively on such information—which is just the tip of the iceberg.

*Forget the "vision": Improving leadership effectiveness stems mostly from assiduous attention to a bin full of "tactics." "Vision" is one thing, but I like to focus on the "(so-called) little stuff": (1) religiously doing your daily MBWA/Managing By Wandering Around—i.e., staying in direct touch with the likes of front-line employees and customers come hell and high water. (2) Visibly and constantly acknowledging staff contributions. (3) Apologizing with an "over the top" response after screw-ups. (4) Acknowledging that meetings are "what you do" as a leader, and turning them from "pains in the butt" into "paragons of excellence"—no kidding! (5) Becoming a Master of Listening—through study and practice. And about 25–50 other things I can readily think of. The "big stuff" (vision) is not unimportant, but longterm improved leadership effectiveness will mostly result from practicing and mastering that hefty bin full of tactics.

*Excellence is not an "aspiration." Excellence is ... the next five minutes. Or not. Excellence is the next conversation in the hall—or not. Excellence is lending someone a helping hand when you are under pressure of a crushing deadline and "don't have the time"—or not. Turning an "insignificant" task into nothing less than a Glorious Exhibition of Excellence—or not. Excellence is not about the long term—it's about right now, or it's a bad joke.

*A "culture of innovation" starts early—that is, the traits enumerated above should permeate the education system, from age five onward. For one (very big) thing, the experimental attitude—and "whoever makes the most mistakes wins"—are antithetical to traditional education, from the USA to Germany to China; that must change if we are to generate satisfactory and challenging employment and economic growth in the near, let alone far, future.

The challenges enumerated here are monumental; few will get passing grades in every category. But we cannot reduce the pace of change bearing down on us, so we must create a strategy and culture that encompasses a big share of the ideas above. And do so at an unrelenting speed.

In Conclusion and Associated With the Above: A Few of My Favorite Quotes for the Times

"Business has to give people enriching, rewarding lives … or it's simply not
worth doing."
—Richard Branson

"Your customers will never be any happier than your employees."—John DiJulius, personal services chain superstar

"We have a strategic plan. It's called 'doing things.'"—Herb Kelleher, Southwest Airlines

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

"Ready. Fire. Aim."—Ross Perot

"The essence of capitalism is encouraging failure, not rewarding success."—Nassim Nicholas Taleb

"Execution is strategy."—Fred Malek, entrepreneur, financier

"Amateurs talk about strategy. Professionals talk about logistics."—General Omar Bradley, commander of American troops/D-Day

"I'm not comfortable unless I'm uncomfortable."—Jay Chiat, advertising giant

"It takes 20 years to build a reputation and five minutes to ruin it."—John DiJulius on social media

"Courtesies of a small and trivial character are the ones which strike deepest in the grateful and appreciating heart."—Henry Clay, American statesman

"You know a design is cool when you want to lick it."—Steve Jobs

"This will be the women's century."—Dilma Rousseff, President of Brazil, at the U.N.

"Avoid moderation."—Kevin Roberts, marketing's "guru of gurus"

"You can't behave in a calm, rational manner. You've got to be out there on the lunatic fringe."— Jack Welch

"Be the best. It's the only market that's not crowded."—George Whalin on great independent retailers thriving in the age of giants

[Ed.: Again, you can download a PDF or PPT of this blog.]

Brett Steenbarger Expounds on Tom’s Stance Against Vision

Brett Steenbarger, a contributor at Forbes, has taken a couple of Tom's tweets and expanded on them with great insight.

Tom tweeted, "Thinking ahead is great, but it becomes more than it is when when you sprinkle Holy Water and enshrine it as Vision." In response to reaction to this pronouncement, Tom went on to post, "Drucker said he'd never met a good leader who was 'charismatic.' I'd like to ban words like 'charismatic' and 'vision.'" (Read the tweetstream here.)

Steenbarger captured the essence of Tom's meaning and made it clearer to the rest of us in his article of July 26 on Forbes.com. We highly recommend his in-depth commentary on the subject of vision, "The Foresight of Leadership." He does an excellent job of supporting Tom's view that a vision may not be the key to success. Thank you, Brett!

Management: The Arrangement and Animation of Human Affairs in Pursuit of Desired Outcomes

I have been tweaking and twisting the attached document. Here's the latest.

The (REAL) Story on Management

What follows is the byproduct of an enhanced (>140 characters) twitter discussion in February 2015 at @tom_peters:

TP: "Management" is a dreary/misleading word. E.g., mgt/standard usage = shouting (or whispering, if you're a "Theory Y" aficionado) orders in the slave galley. Consider, please, a more encompassing/more accurate definition: "'Management' is the arrangement of human affairs in pursuit of desired outcomes." (No kidding. Self-evident. Or should be.)

TP: Management is not about Theory X vs. Theory Y/"top down" vs. "bottom up." It is about how humans fundamentally arrange their/our collective efforts in order to survive—and, hopefully, thrive.

TP: Quintessential "management doctrine": U.S. Constitution?! (Among other things, artfully combines "vision" and "execution.")

TP: Love the idea of U.S. b-schools teaching full-blown course on U.S. Constitution. Three profs: poly sci, econ, psych.

TP: Constitution Hall in Philly in summer of 1787: Ultimate "board room" debate on "managerial philosophy"—in this case, a bold experimental collectivity called a "democratic" nation, the United States of America.

TP: Constitution defining doctrine on the merits and demerits of "centralization vs. decentralization"/autonomy (the "big idea") vs. control (a necessary reality). (The drafters of the U.S. Constitution included decentralists like Jefferson and centralists like Adams and middle-of-the-roaders like Franklin.)

Twitter respondent: "Sounds like someone has locked you in a boardroom for a day with a management consultant."

TP response to the above: Get your point all too well, as a professional jargon hater, but my goal is to suggest there's nothing pedestrian about "management"—and, hence, there should not be anything pedestrian about the teaching thereof. It is about the essence of collective life. (Man, in our Darwinian adventure, experienced a "disruptive" brief period in which our brains grew like Topsy. The growth was not the genetic addition of logic/incipient math skills; it was primarily the addition of enhanced social skills, which allowed us to organize and thus surpass the rest of our fellow creatures. I.e., we learned de facto "management.")

TP: Nations are by definition in the "people (citizen) development business." Which includes an encasement called "national security" (given, alas, a Hobbesian view of humans at their acquisitive-aggressive worst*). (*The drafters of the U.S. Constitution were by and large Hobbesian—much concerned about blunting the downsides of collective behavior.)

The U.S. Constitution is an exemplar of brevity—and for the subsequent 238 years there has been, as there should be, a battle royal between "small government" adherents and "big government" adherents. While my politics are "liberal," I would have to admit that I come down squarely on the Philip K. Howard side of the fence; his latest masterpiece book is titled, The Rule of Nobody: Saving America from Dead Laws and Broken Government. That is, over time sluggishness increases and entropic forces rule. Among other things, this by and large explains the pitiful (accurate word choice) long-term performance of large commercial enterprises; e.g., half of the "Fortune 500" of 1999 had dropped off the list a scant 15 years later.

One sage said that dealing with technology change effectively is less about the technology per se and more about the lagging variable—novel organizational formats that must be invented. I would wholeheartedly agree. The Tech Tsunami is exactly that, a tsunami. But the primary work to be done must focus on people (development thereof in the face of, at the top of the list, charging artificial intelligence) and the organizational arrangements that allow firms to adapt on a dime (as hard a task as exists) and exploit rather than be run over by the technology. This is a million miles beyond mere organizational "flattening" and the "agile movement."

The old battle royal persists. I abhor authoritarianism—but I am equally fearful of anarchy.

We shall see.

(Wouldn't it be lovely if our "management" schools could be a leading variable rather than a lagging variable in embracing change. This wee paper does not hold the answer—but perhaps it is a hint at how tawdry "management," and education associated therewith, must be reconceived as a discipline at the epicenter of adapting to/exploiting the revolutions with which we are surrounded—from Washington to Wellington, from Wall Street to Main Street. We could do little better than start with Peter Drucker's dictum that "management" is not a numbers game aiming for "optimization," but instead the quintessential "liberal art." MBA as "Master of Business Arts," anyone? Just a thought.)

[PDF version attached.]

Getting Things (That Matter) Done

In 2013 I wrote a paper titled "Getting Things (THAT MATTER) Done Against the Odds and in the Inky-black Shadow Cast by the Guardians of the Status Quo." It is based on my personal experience with big change projects such as the McKinsey project that led to In Search of Excellence, which "rebranded McKinsey" according to the book The Firm, and now accounts for a very sizeable share of McK's revenue. Blended in are my observations from dealing with big organizations and big change leaders over the last 35 or so years.

In any event, after my recent Auckland Business School activities, I decided to update and upgrade the 2013 piece. The result is attached.

Lemme know how you like it via twitter: @tom_peters

FYI: I've also tossed in, w/o updating, my 2013 paper "Presentation EXCELLENCE," which I'm sending on to my Auckland b-school mates as well.

Resurrection
(And Irritation)
(And Bewilderment)
(And Fervent Belief)
(And Prayer)

I can hardly complain about my book sales—from 1982 to the present. But there is one of my books that has, in my opinion, been wildly under-appreciated. Namely my 1999 The Professional Service Firm50. It was part of a 3-book series that we called "The Work Matters":

The Professional Service Firm50: Fifty Ways to Transform Your "Department" into a Professional Service Firm Whose Trademarks are Passion and Innovation!

The Project50: Fifty Ways to Transform Every "Task" into a Project That Matters!

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

The Brand You50 took off like a jackrabbit—and continues to be front-page news 16 years later. I am, of course, delighted.

But the real powerhouse, I believe, is The Professional Service Firm50. To cut to the chase, I believe that transforming pretty much any work group into something resembling a Professional Service Firm based 100% on growing intellectual capital—that's all there is—is a de facto singular path to adding corporate value and saving and enhancing the "worker's" security, and even job satisfaction. (At my most arrogant, I say, "What else is there to do?")

Also, as I said in 1999, the good news is we do not have to invent anything new. Though keeping up is nightmarishly difficult for everyone in 2015, the professional services format is tried-and-true and has been around for decades. (E.g., my former employer, McKinsey & Co. has been successfully at it since 1926—89 years; see the recent book The Firm for the more or less full story.)

So why did so few take to this notion? I have an answer: I have no bloody idea.

I got some superlative feedback, including a heroic tale from a senior Walmart exec. But by and large I was greeted by stony silence—i.e., disinterest. In fact, my Tom Peters Company colleagues in the UK created a training product around The PSF50, that worked very well with a handful of clients—but was dropped in response to disinterest in the marketplace as a whole.

To be sure, the transformation suggested is 10X times harder than it looks—e.g., a true PSF "culture" is a long way from most departmental charters. Just ask the leaders of the firms noted at the beginning of the presentation—e.g., Rolls-Royce aircraft engines, IBM, UPS—who have made "services added" (a surrogate for "PSF-ing," by my lights) transformation.

But even with success tales from the likes of IBM, the surface was barely scratched—and as a result 10s of millions of largely salvageable (in my opinion) white-collar jobs have gone bye-bye, and the trend is wildly accelerating as, to quote Marc Andreessen on the incursion of high-end artificial intelligence, "Software is eating the world." (And no, I am not so arrogant as to suggest The PSF50 could have saved 100,000,000 jobs; but I am arrogant enough to think such a methodology, especially if adopted a decade ago, could have made a positive contribution.)

At any rate, a recent event at the Auckland Business School launched me on a crusade to resurrect the "PSF" concept. You will see the first result here, a more or less fully annotated PowerPoint presentation titled "The (Imperative) PSF++ Solution." The ++ in the title refers to adding in the Project50 and Brand You50 ideas.

"Bottom line": PSF (Professional Service Firm) + BY (Brand You) + WP (WOW Projects) + E (Excellence) = UVA (Unassailable Value-Added) 

P-L-E-A-S-E take a look!
(AND ... let me know what you think via twitter: @tom_peters.)

Muffed Answer Leads to Rethink

After a recent presentation at the Auckland Business School, I was asked a pointed question—and flubbed the answer. I was asked if my emphasis on "people-development-first" amounted to keeping unnecessary workers on the payroll.

I said of course not—and stopped there.

Whoops.

But that stopping point (no "make work") has in fact been my starting point since 1999, when I published a 3-book series that we called "The Work Matters":

The Professional Service Firm50: Fifty Ways to Transform Your "Department" into a Professional Service Firm Whose Trademarks are Passion and Innovation!

The Project50: Fifty Ways to Transform Every "Task" into a Project That Matters!

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

At about the same time (actually Y2K), I had audaciously written in a Time magazine cover story, "I believe that ninety percent of white-collar jobs in the U.S. will be either destroyed or altered beyond recognition in the next 10 to 15 years."

That "absurd" prediction doesn't look so outrageous today. E.g., consider this headline from the 11 November 2014 Telegraph (UK), "Ten Million Jobs at Risk from Advancing Technology: Up to 35% of Britain's jobs will be eliminated by new computing and robotics technology over the next 20 years, say experts from Deloitte and Oxford University."

So the idea, then, in an oversimplified nutshell, is to avoid organizational and professional extinction—and in fact pursue growth—by vaulting up the value added chain. In my shorthand: Become a remarkable "brand you" performing 100% value-added "wow projects" in an organizational unit transformed into an innovative "professional service firm"—e.g., devoted to applying intellectual capital to the organization's products and services. (The overall "home" organization, per my model, seeks differentiation by becoming a de facto "collection of integrated professional service firms.")

As you will see in the attached presentation, "The PSF++ Solution," many are on this road. Consider this, for example, from a recent Economist story: "Rolls-Royce now earns more from tasks such as managing clients' overall procurement strategies and maintaining aerospace engines it sells than it does from making them."

There is more than one path to salvation in the face of exponential technology change—but whatever the path, it will in some form or other require adding new value through "soft services"—and transforming oneself into a distinguishable (specialist/brand you/growth-obsessed) professional.

Or so I believe. (Wish I'd said all that in the first place.)