800-CEO-READ Blog: General Management

Michigan Tech's President Likes Collin's Good To Great

I received the autumn issue of Michigan Tech Magazine (a publication of my alma mater) and it contains a Q&A with MTU President Glenn Mroz. The Q that matters for the audience here is:

For alumni, if you could recommend one book to them, what would it be and why?

I guess it would be Good To Great by Jim Collins. It's built on some principles that have really helped me and the executive team. Make sure you pay attention to what you are good at. Make sure you pay attentions to what drives the economic engine of the organization. You have to think about what you rally have a passion for.

One of the principles that was key early on [and in Good To Great.] was the Stockdale principle: "You never confuse faith that you will prevail in the end--which you can never afford to lose--with the discipline to confront the most brutal facts of your current reality, whatever they might be." That may be a little negative, but it's real.

New excerpt up - from The Integrity Dividend

There's a new excerpt up on our Excerpts blog. It's taken from Chapter 1 of The Integrity Dividend: Leading by the Power of Your Word by Tony Simons. From the publisher: In The Integrity Dividend Tony Simons shows how leaders' personal integrity drives the profitability and overall success of their organization. This groundbreaking book is based in on solid research and reveals that businesses led by managers of higher integrity enjoy deeper employee commitment, lower turnover, superior customer service, and substantially higher profitability. This improved performance is the integrity dividend.

Here's a passage from the excerpt:

It's easy to break a promise. It's even easier to forget the price of breaking it. After all, who can measure that price? Few would deny that a broken promise lowers the morale of your employees, but what's the real dollar cost--the bottom line impact? Or what is the payoff of keeping a promise? It should be simple to align your words and actions in a way that employees can see. But if it's so simple why do most employees say their managers do not do it? Maybe it is not so simple.

Consider how two executives described to me the benefit of an impeccable word--and the cost of lacking one:

Good leadership is, 'Whatever I say I'm going to do, I'm going to do.' That means I have to know what my limitations are and what I'm capable of delivering. As a leader if you don't fulfill your commitments, I can't think of anything that can hurt you more than that.

--Frank Guidara, President and CEO, Uno's Chicago Grill

If your staff see you cutting corners, then they're not going to take you seriously. And then they're not going to take the values that you're trying to instill seriously. Because you're not taking the values seriously.

--Deirdre Wallace, President, The Ambrose Group

Like these successful executives, you, too, most likely want be an honest and respected leader. But this book is about more than being respected. As its title says, it's about The Integrity Dividend--and why and how keeping your word as a leader pays off on the bottom line. One thing that sets this book apart from others that discuss the importance of integrity is that it tells how I have been able to accurately measure its positive dollar impact. As you will see more in later chapters, successful executives I talk to recognize the dividend, too, but until now it has not been well measured.

I am not asking you to be motivated by any intrinsic payoff, though I think there are several. Integrity, for me, is about being more effective, because people see you as consistently following through on your word and demonstrating the values you profess: more effective as a leader, because you more readily capture the hearts of your followers; as a communicator, because people know you mean what you say; as a partner, because you can be counted on; as a customer because you complete business transactions more efficiently; as a supplier, because buyers can know what they will get; and as a brand, because you keep your promises--and promises are all that a brand is. Integrity contributes hugely to executive effectiveness.

Check out the full excerpt here: 800ceoread.com/excerpts/archives/008504.html

Management Lessons from the Ryder Cup Win

"If I tell you, then I can never do a book, right?"

That's the answer WSJ Golf Journal writer John Paul Newport got from Ryder Cup captain Paul Azinger after asking how he managed to take the twelve person squad minus Tiger Woods and break the Americans nine year losing streak.

Azinger says he was inspired by the Navy Seals 13-man units and their smaller sub-units constructed for specific missions. The profile matched perfectly with the composition of Ryder Cup team.

The U.S. captain also tapped his life coach Ron Braund. Braund, a psychologist, is a fan of the DISC personality assessment (see his 1995 book Understanding How Others Misunderstand You) and used that methodology to construct teams of similar temperaments. Aggressive players like Phil Mickelson and Justin Leonard were put together while "steady-eddie, unflappable players" like Steve Stricker and Stewart Cink shared the course.

The article ends with this thought:

"There was no guarantee all this strategy would work out, of course, In fact, a final part of Mr. Azinger's strategy was to shift the need for a team victory and more toward his personal commitment to help each player perform at his best."

This described shift is more than a nuance. Notice where the manager's action is placed.

Focusing on the team on a shared victory makes the goal amorphous and intangible for the members.

When focusing on the individuals and creating a situation where each can succeed, superior team performance (and the subsequent victory) is merely a byproduct.

Got a meeting this morning?

Quick Meeting Openers for Busy Managers: More than 50 Icebreakers, Energizers, and Other Creative Activities That Get Results by Brian Cole Miller is an easy book to consult when you want to kick off a group meeting in a fun way.

Here are a few creative activities to get the group started:

Quotes

This is...
> A meeting starter in which participants share their favorite quotes with the group.

Use it to...
> Help the group warm up as well as get to know each other better.

Best group size...
> Up to about 20.

Materials you'll need...
> No materials are necessary for this activity.

Here's how...
1. Before the meeting, tell participants to bring their favorite quote (either written down or memorized).
2. In the meeting, have participants share their quote and then explain why it is important to them.

For example...
> "'To thine own self be true' is my favorite quote. When I was in my early 20s I realized that I was trying to be what others expected or wanted of me. I wasn't happy. When I came to terms with who I am, and then lived true to that, I found great joy as well as inner peace."

Tips for success...
> You go first to demonstrate how much detail you want them to go into. It doesn't have to be an actual quote, it could be a "saying" or "words to live by."

Try these variations...
> Make this more difficult by not giving participants advance warning. Allow them to paraphrase their favorite quote if they can't remember it word for word.
> Rather than a quote, have participants share their favorite saying or lesson learned from their parents while growing up.
> Divide larger groups up into smaller teams of 8 to 20 members to use this activity.

Map It

This is...
> An activity in which participants form a human map based on where they live.

Use it to...
> Help groups visualize their proximity to each other outside of work.

Best group size...
> Unlimited.

Materials you'll need...
> No materials are necessary for this activity.

Here's how...
1. Gather the group in a larger, open space.
2. Have participants create a map by standing relative to one another based on where their homes are.

Tips for success...
> Place something in the middle of the space to represent where they are now. All points should be relative to that point.
> Beyond that, don't help or guide anyone; let the group figure it all out. Don't be surprised if someone else steps up and starts to lead, though.

Try these variations...
> Have participants map where they were born, where they last went on vacation, where they plan to retire, or where their favorite restaurant is.
> Have participants map where their work locations are. Afterward, discuss what impact geographic diversity has on the work they are about to do, if any.

Find more lively activities in Quick Meeting Openers for Busy Managers: More than 50 Icebreakers, Energizers, and Other Creative Activities That Get Result.

Peter Drucker's Five Questions

Peter Drucker 's body of work is mostly recognized in the business community, but he spent an enormous amount of time thinking about the non-profit sector.

One of his many legacies is the New York-based Leader to Leader Institute, an organization that focuses on developing leadership in the social sector. The Institute has updated and reissued a book that was written for non-profits originally but works for any organization.

In the early 1990's, Drucker and the then Drucker Foundation published a self-assessment tool titled "The Five Most Important Questions". In writing why he created the tool, Drucker said:

Although I don't know a single for-profit business that is as well managed as a few nonprofits, the great majority of the nonprofits can be graded a "C" at best. Not for a lack of effort; most of them work very hard. But for lack of focus, and for lack of tool competence."

Let's not be fooled. Business needs plenty of help too.

Drucker's questions are simple, but as is always found in Drucker's writings, the simplicity is deceiving and the clarity of the questions forces you to reexamine your assumptions.

• What is our mission?
• Who is our customer?
• What does the customer value?
• What are our results?
• What is our plan?

The new book is titled The Five Most Important Questions You Will Ever Ask About Your Organization and the Leader to Leader Institute has enlisted some big names to expanded on Drucker's original message. Jim Collins, Phil Kotler, and Jim Kouzes along with Judith Rosen and Kasturi Rangan each provide an essay that follows one of five questions.

The book is a quick read; I was able to finish it during a flight back from the West Coast.

It's the answers to the questions that I am still working on.

Article from Jim Champy, author of Outsmart!

Thanks to Jim Champy, author of Outsmart!: How to Do What Your Competitors Can't. The article below describes some shared characteristics of great companies.

WHERE ARE THE GREAT COMPANIES?
By Jim Champy

For years I have been searching for great companies. What I have found is that there are none. Greatness is an aspiration - a very honorable one. But no company is perfect, even if it performs well year after year.

Greatness, like, many objectives, is in the eye of the beholder. One simple test for greatness is how a company is experienced by its constituents - its customers, its associates, its owners, and business partners. In my most recent research, I looked at over a thousand high-growth companies and found many companies that are very good. They treat all of their constituents well and, in their own unique ways, aspire to greatness.

My search was driven by a desire to find companies that have new business models, delivering new products and services to customers and executing in new ways. I have written about my discoveries in OUTSMART!, my latest book. Although I could find no single formula for what creates a good - or great - company, I did find some shared characteristics.

Ambition: The leadership team of every good company has a great ambition for the company - usually one that addresses an unmet customer need. The ambition is not one of personal greed; it's about building a company that delivers on its promise and does it with a unique quality. My experience over the years is that it takes a great ambition to create even a good company. I was inspired in my research by a company called Minute Clinic, whose ambition is to change how healthcare is delivered, for the benefit of everyone involved in the healthcare system.

Customer: Every good company begins by meeting a customer need. That need is often deeply understood by the company's founder because they, themselves, experienced the need - and saw how that need was not being well met. Sometimes the founder hands off the leadership of the company to someone else who operationalizes the idea. But that wasn't the case in the example of Sonicbids, a company that saw the unmet needs of thousands of independent musicians and performers and whose founder has led the company to a unique position in the music business. This music business for independent performers is a 13 billion dollar a year market, that no one saw or had the appetite to organize until Sonic bids came along.

Focus: Good companies stay focused on what they know and can do well. When companies search for new ideas, they often drift into unknown territory and get in trouble. Good companies just keep growing and expanding into familiar territory. Shutterfly is a wonderful example of a company that's growing, but it grows by expanding within the social expressions business, helping communities of people share photographs in hundreds of ways. Niches can be very large markets.

Execution: Satisfying a customer requires relentless attention to execution. Building a company's capability to deliver makes the difference between turning a great idea into a business or failure. But execution is not just about delivering a product. It's also about service. Over the years, I have observed that technology companies are particularly bad at recognizing and responding to the service needs of their customers. Counter intuitively, high-tech requires a lot of high-touch. Partsearch is a company that knows what it's doing with customer service, helping customers find what they need in an ocean of millions of parts and accessories for consumer electronic products. Partsearch has tamed chaos in its industry.

Inspiration: Smart companies engage all of their associates in building the business, from idea creation though delivery. Ideas don't just come tops-down; they also come bottoms-up and from every other direction. Everyone in the company feels that they own a piece of the action and are accountable for how the company performs. The inspiration for a company starts at the top, but good leadership drives that inspiration deep into the company by engaging people broadly in decision-making. People are more than mechanical parts of the enterprise, and the more they are allowed to see customers, the better their business sensibilities.

These are some of the behaviors that I have found in the good companies I have studied. My ultimate test of the quality of a company is whether I would like to work there. The good news: I see many high growth companies where I would work. They are smart companies, in multiple industries, that are operating quite brilliantly.

Author Bio
Jim Champy is one of the leading thinkers in business. His first book, Reengineering the Corporation: A Manifesto for Business Revolution, helped transform the corporate world. For more information, please visit www.jimchampy.com.

Check out Outsmart!: How to Do What Your Competitors Can't!

Remembering Michael Hammer

If the book of the 80's was In Search of Excellence by Peters and Waterman, then book of the 90's was Reengineering the Corporation by Michael Hammer and Jim Champy.

We were saddened to hear Michael Hammer died this week at age 60.

The best way we can think of to acknowledge his impact is by announcing the inclusion of Reengineering The Corporation in our upcoming book. Here are the opening paragraphs to our review of Reengineering the Corporation, which give perspective to the work that Hammer and Champy started fifteen years ago:

"Reengineering became the magic managerial term of the 1990s. Cover stories in business magazines touted Michael Hammer and Jim Champy as the strategic gurus of the moment. Companies like Deere, Ford, and Duke Power all found huge success using the concepts. Even Lou Gerstner in his autobiography, Who Says Elephants Can't Dance?, calls out reengineering as having played a role in his turnaround of IBM. The trouble with every fad is the ridicule that follows.

In the 1990s, the term "reengineering" became an easy substitute for the prior decade's "reorganizing,""restructuring," "delayering," "downsizing." The popularity of the term gave embattled executives needed cover when faced with media scrutiny and stock market pressure. The mere mention of a new reengineering initiative acknowledged the severity of a problem and indicated to shareholders that proper steps were being taken. But the actual results varied widely, and business leaders and journalists were quickly off to find and report on the next silver bullet. What's left is general ambivalence for one of the most important business concepts in the second half of the 20th century."

Freakonomics' Levitt Questioning Good To Great

Steven Levitt on his Freakonomics blog takes a shot at Good To Great and the recent performance of GTG standouts Fannie Mae, Circuit City, and Wells Fargo. A purchase of either Fannie Mae or Circuit City at the time of the book's publication would have netted you an 80% loss in your investment today. Not so good.

This bring ups the whole question of the author Jim Collins' suggested methodology and whether it's one business leaders should be following. There are plenty of great comments on Levitt's post to go read on this. The same criticisms are leveled against Collins' prior book Built To Last and the classic In Search of Excellence by Tom Peters and Bob Waterman. Nassim Nicholas Taleb's Fooled By Randomness and Phil Rosenwig's The Halo Effect are both cited for their critical views of predictable methodologies.

This has always been my belief: all of these books are directional correct. The principles they describe for success are all worth pursuing. We get a little stuck on the empirical side of the debate. It is true that these authors hang their hats on the research to give their findings legitimacy, but we can't completely dismiss everything they have to say every time a highlighted firm falters.

Webinar with Dan Heath, author of Made to Stick

One of our favorite authors, Dan Heath, is leading a web seminar through The Center for Great Management.

Click here to learn more about the seminar and to sign up if you're interested.

Here's the description of the event:

Virtual Seminar Overview In this era of ever-tougher competition, your company's greatest asset is its managers. Why? They've got stellar ideas for new strategies that will leave rivals scrambling; for innovative products that will wow customers; and for fresh ways of doing business that will attract top talent, slash costs, and burnish your bottom line. But even the best idea won't make a difference if a manager can't "sell" it--can't get people to embrace it, remember it, and act on it. Let bestselling author and communication thought leader Dan Heath show your managers how to make their ideas "stick" for maximum business impact. Dan reveals the six principles that distinguish ideas that thrive from those that die:

• Simplicity-strip the idea to its core, without turning it into a silly sound bite
• Unexpectedness-capture and hold people's attention
• Concreteness-help people remember the idea
• Credibility-get people to believe your idea
• Emotion-persuade people to care about your idea
• Stories-get people to act on your idea new solutions

For each principle, Dan provides a wealth of examples of how real people have made great ideas sticky--in endeavors as diverse as business, entertainment, public health, and education.

Don't let your managers miss this opportunity to capture critical insights for crafting--and communicating--high-impact ideas.

Each participant receives a copy of the book Made to Stick, an executive summary of the book, and a comprehensive study guide.

New excerpt up - from Divide or Conquer

There's a new excerpt up on our Excerpts Blog. The excerpt is taken from Divide or Conquer: How Great Teams Turn Conflict into Strength by Diana McLain Smith. This chapter examines the the Steve Jobs/John Sculley breakup at Apple in the 1980s, a conflict that nearly destroyed the company.

The story begins:

More than 20 years have passed since Steve Jobs and John Sculley's much-publicized breakup at Apple. Yet it still serves as a cautionary tale. In two short years, their celebrated camaraderie turned into an antagonism so great it escalated hostilities between divisions, put the firm at risk of a takeover, and sent Steve Jobs into a 12-year exile, from which the firm has only recently recovered. How these leaders went from soul mates to adversaries in such a short time shows how relationships, even those touted as a perfect match, can self-destruct under pressure, leaving a firm to pay the formidable price of a failed relationship.

This case study is one of many found in Divide or Conquer. From the publisher: "Smith shows us how to build work relationships that are flexible and strong enough to survive the toughest challenges... This book will break the myth that relationships are too mysterious to decode and too difficult to change. It offers powerful tools that can help anyone, from new recruits to CEOs."

Here's a direct link to the excerpt: http://800ceoread.com/excerpts/archives/008261.html

I Can't Remember The Last Time...

Jack and I have been pretty quiet on the blog over the last year. The process of writing a book took more time than I ever imagined. I have a completely new appreciation for the authors who have come before me. Seth suggests everyone write book in a post on his blog today, and I agree it is a great idea, but understand the work you are in for.

Anyway, this post is really about the first chance I have had in months to spend the morning looking through books. I promise more posts in the coming weeks, but here is what has caught my eye this morning.

• The Word of Mouth Manual Volume II - Dave's new book is worth a look. You can download it for free or buy it printed on paper.
• I am reading The Breakthrough Imperative. This is a book from Bain & Company. I have read enough of their partners' work to finally say that I like their message. I am just getting started, but I think this is a culmination work for the company combining the ideas of Fred Reichheld, Chris Zook, and others. More on that soon.
• There is a new second edition to The Age of Heretics by Art Kleiner. Too many people have told me that I have to check this out. I am going to read the book and then have Art on for a podcast.
• I am a huge fan of the Memo To the CEO series, which we post the Jack Covert Selects for on Friday. Check them out.

Enough for now. And I promise again to get back to writing more here.

Big IDEAS to Big RESULTS

Last week Mike Kanazawa, co-author of Big Ideas to Big Results, joined our 8cr family for two days and keynoted for two events in Wisconsin.

One of the stories Mike shared is that of touring an office building. The woman giving him the tour boasted having the longest group of cubicles west of the Pentagon! This city of cubicles was the breeding ground for Scott Adams' Dilbert comic strip. His former cube is memorialized by a serial number.

That lead into the question of "Is your goal to get the most of people or to get the best out of people?"

My guess is you would agree that it's to get the best out of people. That takes an environment and a culture that supports that mission. Easier said than done. I'm paraphrasing Mike here, two suggestions:

Do More on Less. It's easy to keep pushing more on the plates of your best employees. Stop. Take projects off their plates so they can spend more time on fewer projects. They'll be able to dedicate the time necessary to grow and complete the project. You (the boss) will be more satisfied with the results, as will be the employee.

Delete "buy in." There's this corporate idea of getting people, employees, to "buy in." Buy into an idea, a strategy, whatever change needs to happen. Many times companies wait to implement top-down structures and don't engage employees until after the process is implemented. Instead, work up front on engagement. Involve everyone from the beginning of a new change. Then when you reach the back end, there's no need to sell the idea to anyone in the company and everyone can focus on executing the change.

I'm hoping to have some video footage from the event to post here soon. Todd interviewed Mike on the process of writing the book. I hear Mike's on board for a ChangeThis manifesto. Stay tuned! In the meantime, jump over to Mike's blog.

Mike, thanks for coming!

Is it still possible to build a company that lasts?

In 1994, Jim Collins co-authored the landmark title Built to Last followed by Good to Great in 2001. This month's special edition of Fortune magazine features a piece by Collins.

A technology pundit told Collins that, "'We live in an era when nothing can be built to last. Everything is in flux; nothing can sustain.'"

When looking at the Fortune 500 facts presented in the piece, that seems to be true:

* Of the 500 companies that appeared on the first list, in 1955, only 71 have a place on the list today. (The 1955 list included industrial companies only, whereas today's list also includes service companies.)

* Some of the most powerful companies on today's list--businesses like Intel, Microsoft, Apple, Dell, and Google--grew from zero to great upon entirely new technologies, bumping venerable old companies off the list. Robert Noyce invented the integrated circuit in 1958, three years after the first Fortune 500. Dozens of companies on this year's list did not even exist in 1955.

* Some of the most celebrated companies in history no longer even appear on the 500, having fallen from great to good to gone from the list--companies like Scott Paper, Zenith, Rubbermaid, Chrysler, Teledyne, Warner Lambert, and Bethlehem Steel--most often because they gave up their independence, and sometimes because they outright died.

Jim counters those points with proof of endurance: P&G, started before the American Civil War, continues to succeed; as does Johnson & Johnson whose roots were planted back in 1886 and GE which has been around for over 100 years. Then there's Nucor Steel who rose from near bankruptcy to the 151 spot on the Fortune 500 list (its story can be found in the out-of-print book, American Steel). Or Xerox which turned over profits of over $1 billion in 2007, a mere seven years after suffering losses of over $300 million.

Jim's underlying message is that the environment is not responsible for a company's success or failure. He points out that success or failure "depends more on what you do to yourself than on what the world does to you."

The full article is available here.

New Excerpt up - from The Breakthrough Imperative

Head over to our Excerpts Blog to find an excerpt from the book The Breakthrough Imperative: The Strategies That Drive the World's Best Managers by Mark Gottfredson and Steve Schaubert.

As a general manager, your job is to devise a strategy for performance improvement. Insight into your customers' preferences and behaviors, and into how those preferences and behaviors might change over time, is essential. It can help you take full advantage of your competitive position. It may even give you the ability to counteract the advantages of leaders who are farther down the experience curve and thus move up (or over) the ROA/RMS band.

Here's a direct link to the excerpt: http://800ceoread.com/excerpts/archives/007896.html

And, if you missed it, here's a link to the excerpt Dylan put up yesterday, from The Quest for Global Dominance:
http://800ceoread.com/excerpts/archives/007892.html

New Excerpt - from Pricing with Confidence

There's a new excerpt up on the Excerpts blog. It's the summary of the book Pricing with Confidence: 10 Ways to Stop Leaving Money on the Table by Reed Holden and Mark Burton.

Holden and Burton show you how you can get everyone in your firm to feel 100% confident in your pricing--no matter what customers are saying or how fierce the competition. By following the 10 simple rules outlined in Pricing with Confidence, you will be able to hold steady or even raise prices while your customers experience increased value for every dollar they spend. The result? Increased revenues and profits.

Pricing with Confidence is a roadmap for senior leadership in sales, marketing, finance and pricing to work together to outperform competition. Pricing with Confidence is organized into ten simple and practical rules to help senior leaders tackle rampant price discounting, negotiate with poker-player like customers, and protect the value a company works so hard to create.

Read about the authors' ten rules here: http://800ceoread.com/excerpts/archives/007768.html

Exclamation Points!

From Monday's WSJ:

Nancy Camarota, a customer-relations executive at Allied Waste Industries Inc., said she thought it was odd when a Deloitte & Touche USA LLP consultant used an exclamation point in an email. 'Guys do not use exclamation points,' she thought. 'Is he making fun of me?'

Exclamation points are one piece of Deloitte's new strategy for communicate with women clients. Cathy Benko, co-author of Mass Career Customization, is spearheading the initiative. Consultants are being trained to:

...sit across from women at a table, rather than next to them, and to bring subordinates to meetings because women value knowing the people who do the work. In the case of the exclamation point, Ms. Camarota had used one in an earlier email; the Deloitte consultant says he was responding to her enthusiasm as part of the new program.

We're living in an age where everything can be customized -- by gender, age, work preferences, etc. And that's the subject of Cathy's book -- how to align careers with their workers.

Business Book Video on BNet

BNet has started running short video of authors in a feature they call Business Book Briefs. Right now, they are serving Vince Thompson (Ignited) and Bob Sutton (The No Asshole Rule).

Testing and Tasting The Theory

Jack and I are in NYC this week on our annual fall trip. We dined at Union Square Cafe this evening. Owner Danny Meyer wrote Setting The Table last year and the two of us decided we need to check if the theory was put into practice.

The experience was amazing. Our waiter Cyrus connected with us immediately and correctly recommended the Saison Du Pont. Jack had the cod and I enjoyed the lobster "Shepard's Pie" (layered from the bottom with spinach, mushroom, lobster meat, and mashed potatoes).

It is tough to get a reservation. Your best bet (the method we used as recommended in the WSJ) is using Open Table and reserving a table 28 days before your date.

Two New Fables Break-up Summer Bestsellers Club

After a summer of same-old, same-old on the Wall Street Journal Business Bestseller List, two new books appear this week signaling the start to the fall business book season.

Given some of my comments recently, it serves me right that I have to report both titles are business fables. Pat Lencioni returns with his sixth story-based book, titled The Three Signs of a Miserable Job: A Fable for Managers (and Their Employees). The second book, Dream Manager, is from previously published, but new business books Matthew Kelly.

We have had these two books featured, along with Juggling Elephants, on the front page for a couple of weeks, which makes us seem like we can foresee the future (hold the email, we do not have any such ability).

Jack reviewed Dream Manager this month and our new writer Jon gave a nice summary of Three Signs if you are interested in following the crowd to these new books.

Podcasts Start Back Up with Zook

We took some time off this summer from our podcasts.

I am kicking off the fall season early with an interview I have been wanting to do for some time.

Chris Zook is the author of three books, his most recent being Unstoppable. I talked with him for almost an hour about how to achieve profitable growth through focusing on the core of your business.

I also asked him what books he would recommend to other books. He says there are three different kinds of books he is attracted to:

• The Classics - Chris says there are a handful of books that everyone should read. These are familiar titles: Comptetitive Strategy, Competing for The Future, and Good To Great.
• Business Histories - Chris says there is much to learn from how companies deal with challenges to their business models. He recommends Rising Tide: Lessons from 165 Years of Brand Building at Procter & Gamble.
• A Step or Two Away - sometimes you can learn alot by getting away from the business category. Chris is currently reading In Spite of The Gods, a wonderful history of India. Another title that Chris thinks fits this is James Gleick's Chaos, which took chaos theory research and showed how it applied to what folks deal with every day.

Five Business Book Classics - The Essay

I wrote a piece for the July/August issue of Corporate Dealmaker. The magazine did eight pages on business books and their impact on the M&A industry. Here is my contribution where I discuss books that should be on every executive's reading list:

And Don't Forget The Classics

There are M&A books, and there are business books that should be required reading for every executive. Here are five guaranteed to help you be more productive and make smarter decisions.

by Todd Sattersten

Books on mergers and acquisitions often take a distinct nuts-and-bolts approach. No mystery there: Deals are complex projects and dealmakers want practical advice on how to execute them. Even for dealmakers, though, transactions are just part of a bigger strategic picture, on where decisions of many kinds are needed. Every executive, dealmaker, or otherwise, is ultimately judged on the quality of the decisions he or she makes, and there's no shortage of books aimed at helping those managers make smart choices. Here are five that should be on every executive's reading list.

1 - "Competitive Strategy" by Michael Porter

If you boil business down to its essence, you are left with two key elements--strategy and execution. Strategy is deciding what direction to go, and execution is how to get there. Michael Porter's "Competitive Strategy" gives us the clearest view of the first element. Strategy is about competition, and prior to the book's 1980 publication, competition was defined as other companies operating in the same industry. Porter's five forces model created a much richer view, adding suppliers, buyers, substitutes, and new players to the definition. Those added dimensions made Porter's work ground-breaking. Without Porters' model, it is hard to see how PC manufacturers' margins quickly shrank in the 1990's. The cause was not competition among industry players, but the superior bargaining power of their two primary suppliers--Intel and Microsoft. In my industry of publishing, substitutes have become the primary source of competition as readers' attention is diverted to other forms of media.

2 - "Execution" by Larry Bossidy, Ram Charan, and Charles Burck

But strategy is only one half of the equation. An organization must be able to carry out the plan and "Execution", released in 2002, is one of the best book out there on the topic. In their book, Bossidy, who spent 40 years running industrial conglomerates, Charan, who provides insights as a guru to Fortune 500 CEOs, and writer and editor Burck mapped out "a system for getting things done through questioning, analysis, and follow-through." Identifying and developing leadership talent lies at the core with the goal not to evaluate people for what they are doing today, but for the positions they will hold tomorrow. Leaders then lay out clear goals everyone in the organization can understand, follow-through to clear internal obstacles, and reward the doers who are producing results. Finally, organizations that understand execution inject a healthy dose of realism into their culture through open, informal dialogue to eliminate false consensus and by making needed changes today rather than waiting for tomorrow for things to get better.

3 - "In Search of Excellence" by Tom Peters and Bob Waterman

"In Search of Excellence", published in 1982 was the result of a McKinsey project started five years prior to find out what successful organizations look like. The authors found that the most effective organizations were those that recognized the irrationality of the humans that inhabited them. Those companies were clear about their beliefs and created a strong value system that acted as a compass for organizational decision-making. Inside companies like Boeing, 3M, and Hewlett-Packard, Peters and Waterman found small, passionate teams accomplishing big, game-changing feats and meetings taking place in hallways as executives exercised management by walking around.

4 - "Good to Great" by Jim Collins

Jim Collins also looked at successful companies in his 2001 best-seller. Using a methodical approach, Collins identified companies that went from average to sustained periods of growth. Walgreens, Pitney-Bowes, and Nucor were among the 11 companies that made the cut and his book's metaphors have become a lexicon for business in the 21st century-the flywheel, BHAGs (big hairy audacious goals), level 5 leadership, to name a few.

5 - "The Effective Executive" by Peter Drucker

Before Stephen Covey's "Seven Habits" and David Allen's "Getting Things Done", Peter Drucker det the standard for books on productivity with "The Effective Executive". Decision-making, playing to your strengths, and "first things first" are all presented with the signature clarity Drucker brought to the study of management.

Todd Sattersten is vice-president of 800-CEO-READ and author of an upcoming book from Portfolio on the 100 best business books of all time.

A New Season begins - August 2007 Books

I know it is only a few of days into August, but we are starting to see and think about the fall.

Jack is quoted today in a Bloomburg News story about Dream Manager by Matthew Kelly. He is a little more positive about the book than might be evident from the quote. We'll be featuring it as a Jack Covert Selects this month.

I have been reading a really interesting book called Super Crunchers by Ian Ayres. I am writing a couple of posts now about the book and we'll be reviewing it this month as well.

Here are couple other titles making an August release:

• Recruit or Die: How Any Business Can Beat the Big Guys in the War for Young Talent by Chris Resto, Ian Ybarra, and Ramit Sethi
• What Made Jack Welch Jack Welch: How Ordinary People Become Extraordinary Leaders by Stephen H. Baum with Dave Conti
• Remarkable Leadership: Unleashing Your Leadership Potential One Skill At A Time by Kevin Eikenberry

What is it about fables?

The New York Times interviewed John Kotter yesterday and reported on his business fable Our Iceberg Is Melting. These numbers set the stage:

Since its release last September, "Iceberg" has sold some 224,000 copies in hardcover (Leading Change [his prior book] has sold more than a million copies in 10 years), and been translated into 10 languages, with 10 more foreign editions in the works.

When I reported on the Publisher Weekly best-seller numbers, Our Iceberg Is Melting was the surprise on the list. I had no idea the book was doing so well.

The idea for the fable version came from reader Holger Rathgeber. In preparing for a presentation, Rathgeber became inspired by the drawing on the cover of Leading Change. The picture shows penguins jumping from one iceberg to another, so Rathgeber had everyone create penguin masks from construction paper during the workshop. Rathgeber sent Kotter a sample of the materials and Kotter was immediately taken.

So, Kotter rewrote Leading Change as a fable with the penguins and sent a draft out to friends in 2004. Requests started to roll in for copies of the book. Kotter decided to self-publish and went on to sell 15,000 copies. Publisher St. Martin bought the rights and published it in 2006.

I have to tell you I don't understand the popularity of fables like this. They are meant to appeal to a large audience, and that is the trouble for me. The messages these book convey are too simplistic. I guess this leaves me in the minority given the success that many of these books have.

My only solace lies in the fact that since the mainstream release of "Iceberg", we have sold twice as many copies of Leading Change as we have the fable. I guess our customers want the full version as well.

The Internal Attack of the Ego

Yes, fighting can be a great creative tool when ego doesn't get in the way.

On that note, Josh explains that ego often gets in the way of collaboration. To this, Audrey responds that for any successful collaboration, we must let go of our false sense of control.

Chandler, Our Historian

Business historian Alfred Chandler passed away last week. The Wall Street Journal ran a thorough piece on his life and work in their Weekend Edition.

Strategy and Structure is a title most look to as a hallmark in the study of business management. Here is Peters and Waterman's concise description from In Search of Excellence:

Quite simply, Chandler observed that organizational structures in great companies like Du Pont, Sears, General Motors, and General Electric are all driven by changing pressures in the marketplace. For example, Chandler traces the market-driven proliferation of product lines in both Du Pont and General Motors. He shows how that proliferation led to a needed shift away from a functional monolithic organizational form toward a more loosely coupled divisional structural form.

Chandler won a Pulitzer Prize for The Visible Hand: The Managerial Revolution in American Business. He makes the case that business managers have a far greater influence than market forces of Adam Smith's Invisible Hand.

Here is an incomplete bibliography of his work:

• Leviathans: Multinational Corporations and the New Global History (Cambridge: Cambridge Uni Press 2005) coedited with Bruce Mazlish
• Shaping the Industrial Century: The Remarkable Story of the Evolution of the Modern Chemical and Pharmaceutical Industries (Cambridge: Harvard Uni Press 2005)
• Inventing the Electronic Century: The Epic Story of the Consumer Electronics & Computer Industries (New York: Free Press 2001)
• A Nation Transformed By Information: How Information Has Shaped the United States From Colonial Times to the Present (New York: Oxford Uni Press 2000) coedited with James Cortada—incisive essays about publishing, telecommunications, management structures, productivity and economic growth
• The Dynamic Firm - The Role of Technology, Strategy, Organization and Regions (New York: Oxford Uni Press 1998) coedited with Peter Hagström & Örjan Sölvell
• Big Business & the Wealth of Nations (New York: Cambridge Uni Press 1997) coedited with Franco Amatori & Takashi Hikino—a collection of papers on corporate organisation, markets and government, notable for international comparisons and skepticism about dogma such as the Wiener thesis
• Scale & Scope: The Dynamics of Industrial Capitalism (Cambridge: Harvard Uni Press 1994)—a continuation of Strategy & Structure, including UK and German enterprises
• The Essential Alfred Chandler: Essays Toward a Historical Theory of Big Business (Boston: Harvard Business School Press 1988), edited by Thomas McCraw (out of print, ISBN 0071033173).
• Managerial Hierarchies: Comparative Perspectives on the Rise of the Modern Industrial Enterprise (Cambridge: Harvard Uni Press 1980) coedited with Herman Daems (out of print, ISBN 0674547411)
• Managerial Innovation at General Motors (New York: Arno Press 1979)—editor
• The Visible Hand: The Managerial Revolution in American Business (Cambridge: Harvard Uni Press 1977)—the landmark study of communications, management processes and institutional structures
• Pierre S. Du Pont and The Making of the Modern Corporation (New York: Harper & Row 1971) with Stephen Salsbury—a deservedly influential study of corporate organisation and management styles
• The Papers of Dwight David Eisenhower (Baltimore: Johns Hopkins Uni Press 1970-80) coedited with Stephen Ambrose, Louis Galambos and others—the 11 volume official edition of the papers of the US President
• Railroads, the Nation's First Big Business (New York: Columbia Uni Press 1965)
• Strategy & Structure: Chapters in the History of the Industrial Enterprise (Cambridge: MIT Press 1962)
• Henry Varnum Poor - Business Editor, Analyst & Reformer (Cambridge: Harvard Uni Press 1956)—the definitive biography of the early US business analyst, progenitor of Standard & Poor's rating service
• The Letters of Theodore Roosevelt (Cambridge: Harvard Uni Press 1951-54) coedited with Elting Morison & John Morton Blum—the four volume authorised edition of the correspondence of the big game hunter, conservationist and President.

source : Calston Analytics

How to peel a banana

How do you peel a banana? If you're like me, you peel it the "wrong" way. That's the way we're taught. Pinching a banana from the other end is actually easier as we've learned from gorillas.

Seth, too, admits to the crime of knowing the "right" way to peel a banana but still insists on peeling it the "wrong" way.

Why? It's hard to execute change whether in peeling bananas or reorganizing companies. According to Jim Collins, "fewer than 1% of companies ever make the leap" (from the May 2007 Business 2.0 article, Changing Minds).

And, while we're on the topic of bananas, did you know they are easily split into thirds?

A Book of Decencies

Over the past few months, Jack and Todd have been taking each of us out for lunch. It's a chance for them to ask, "How are things going?" As they work their way around the office, they're learning about the things that are working well in our environment and the things that could be improved. More importantly, they're showing each of us that our experience at 800-CEO-READ matters, and that we can come to them with anything.

Jack and Todd are doing what Steve Harrison refers to as "decencies" in The Manager's Book of Decencies: How Small Gestures Build Great Companies. In describing his father's role as a psychiatrist, he says "My father's job was to listen--perhaps the ultimate decency of all." As most managers know, there are even more decencies a company can extend to its employees--small decencies like a coffee cart, a work-at-home day, introductions at meetings, and the freedom to choose projects that interest them. And then there are large decencies like company-wide mentoring programs, flexible schedules/shifts, defined employee rights, gestures of gratitude, and inviting employees to voice their opinions and concerns.

This book provides a list of these decencies, categorized under chapter titles like Consideration Decencies, Recognition Decencies, and Executive Humility Decencies, that can lead to workplaces where people are excited to come to work and happy to do their jobs. Harrison profiles a number of decency-extending companies like Lee Hecht Harrison, Disney, HP, Nabisco, Starbucks...the list goes on. Here's a brief excerpt on building great companies:

"Creating environments that employees describe as "a great place to work" and in which employees are free to speak their minds relies on the practice of decencies on a regular basis by everyone in the organization. It also takes leadership at the top to start the process, reinforce the efforts along the way, and communicate the long-term benefits of creating and sustaining an organization culture based on trust. These practices go beyond the leaders at the top to become common acts among people throughout the organization."

What I love about our workplace is our culture of extending decencies--of shutting up when someone's taking an important call, helping tip letters into a thousand books, toasting an important event in one of our lives, and taking the time to meet every two weeks and talk about the things we're working on. And the employee lunches haven't been half bad.

Audio Elsewhere

There is great business audio all over the net. Here are just a few places to supplement your media diet:

• Lisa Haneberg has been doing her Fireside Chats for some time. Some of hers include Peter Georgescu(The Source of Success), Lee Froschheiser (Vital Factors), and Marcus Buckingham (Go Put Your Strengths To Work).
• HBSP Working Knowledge has an audio series. Their first interview was with Richard Tedlow, author of Andy Grove: The Life and Times of An American.
• IT Conversations has the occasional business person. Contributor Dr. Moria Gunn has interviewed Mark Thompson, author of Success Built To Last and Chris Anderson, author of The Long Tail.
• The Invisible Hand Podcast is full of great stuff. They cover more of an economics and management angle. A sampling of their recent episodes includes The World's Newest Profession, Capital Rules, and Coming Attractions.

What Podcasts People Are Listening To

Here is a little peak into what people are listening to on our Podcasts blog. This is a ranked list for the first four months of 2007.

1. The Elegant Solution Interview with Matt May
2. Marketing and Sales for Big Complex Selling Interview - Part 1 with Brian Carroll
3. Marketing and Sales for Big Complex Selling Interview - Part 3 with Brian Carroll and Jill Konrath
4. Everyday Greatness Interview with Stephen Covey
5. The Difference Maker Interview with John Maxwell
6. Confessions of An Economic Hitman Audio Excerpt
7. Made To Stick Interview with Dan Heath
8. Growing Great Employees Interview - Part 2 with Erika Anderson
9. Purpose Interview with Nikos Mourkogiannis
10. Growing Great Employees Interview - Part 1 with Erika Anderson

Authors visiting Google

Google has been bringing authors in to speak for quite some time now. They recently shared the videos of the authors' visits from John McCain to Valentino Achack Deng. In the business arena, you'll find these folks and more:

1. James Scurlock, Maxed Out: Hard Times, Easy Credit and the Era of Predatory Lenders
2. Chris Anderson, The Long Tail
3. Max Barry, Company
4. Tim Ferriss, The 4-Hour Workweek

So far there are 68 posted.

Boom Goes Your Business (Failure - Part 2 in a series)

Jagdish Sheth says his journey started as he tried to understand why so many companies that were highlighted in books like In Search of Excellence and Good To Great failed to have continued success. Sheth argues that companies acquire habits that lead to their fall. His latest book is called The Self-Destructive Habits of Good Companies...And How To Break Them.

Sheth says there are seven deadly sins that are destructive to corporations—Denial, Arrogance, Complacency, Competency Dependence, Competitive Myopia, Territorial Impluse, and Volume Obsession.

And if we are going to define "sins" then we need to talk about what is Sheth considers bad:

For our purposes, let's consider two aspects, or connotations, of "bad." The first is the more obvious and direct: bad means unhealthy, no good for you, contrary to your self-interest, or desctrutive. Behavior that makes your customers and suppliers resent you, that makes them seek out other business partners, seems clearly "bad" in this sense. Arrogance or abuse of stakeholders would seems to be good examples. But "bad" in the business arena can also suggest "lost opportunity." Here, perhaps complacency, or underestimation of the competition, causes you to fail to maximize your potential. Your behavior may not be "actively" bad, nor are you reviled by others in your community. But your vision has failed, and you have lost, or are about to lose, your chance.

Sheth continues by saying that all of these problems may not be caused by management, but it is their responsibility to fix them.

To give you an example of content and structure, here is the chapter summary on Competitive Myopia:

Competitive Myopia

Things that lead to competitive myopia:

• The natural evolution of the industry
• The clustering phenomenon
• When No. 1 is also the pioneer
• The opposite scenario: when No. 2 chases No. 1

The warning signs of competitive myopia:

• You allow small niche players to coexist with you: You're focused on the big guys, so you don't see the niche companies as a threat.
• Your supplier's loyalty is won by a nontraditional competitor: You fail to realize that your supplier can become your competitor.
• You underestimate new entrants, especially from emerging economies: You fail to acknowledge the threat of new entrants.
• You have become helpless against a substitute technology: The threat has always been there, but you have not reacted in time and must surrender.

How to break the competitive myopia habit:

• Redefine the competitive landscape: You need to check the entire competitive perimeter to see where you are vunerable.
• Broaden the scope of your product or market: Diversify by expanding the market for your existing products or by expanding your product lines in your existing markets.
• Consolidate to squeeze out excess capacity: Decrease buyers' bargaining power by removing excess capacity from the industry.
• Counterattack the nontraditional competitors: Return fire on a unique competitor by attacking its home turf.
• Refocus on the core business: The "entrenchment" strategy may seem counterintuitive, but it allows you to concentrate limited resources in your most successful area.

There is something attractive in Sheth's conclusions. They remind us what what we don't like in people. I think they sound familiar given his heavy reliance on press accounts of these companies (Halo Effect warning).

I like Sheth's examination of the downside of business, but I am torn as to whether I have more knowledge to avoid the problems that Sheth lays out in the book or whether these emotion laden habits are really the root cause of failure.

No "Jack Welch" on the horizon

It's interesting how many inquiries we receive regarding "CEO" books. Not from customers, but from the media. There seems to be a fascination with the stories of heroic or villainous business gurus. Remember the sensation surrounding the release of Carly Fiorina's memoir? Conveniently released around the inquiries into HP's spying scandal.

As it turns out, the latest trends in business book sales are not toward the famous CEO biographies (though, of course, we have seen success with titles like Tough Choices and Andy Grove), but toward the books that help people find answers to questions and solutions to problems.

In today's Wall Street Journal, in the Marketplace section, the "In the Lead" column discusses the books that business people--even executives--are turning to, books that "promise to help managers to everything better--from building strong teams and winning customers to achieving robust profits."

This latest wave of business books also stresses "the importance of being able to continuously improve results. Now, more books emphasize innovation over execution--the principle and vision beyond the the plans."

A few titles mentioned in the article:

• True North: Discover Your Authentic Leadership (which actually debunks "the myth of the superhero top executive)
• Know-How: The 8 Skills that Separate People Who Perform from Those Who Don't
• Made to Stick: Why Some Ideas Survive and Others Die
• The World is Flat
• Freakonomics
• The No Asshole Rule

What Even We Sometimes Think

[hat tip to Businesspundit]

Five Best from Ken Roman, Former Advertising Executive

Saturday's Wall Street Journal had a list of the five blue-chip business management books. The list was compiled by Ken Roman, a former advertising executive. I think it is one of the best lists I have seen.

1> The Effective Executive by Peter Drucker
2> Management and Machiavelli (out of print) by Antony Jay
3> What They Don't Teach You at Harvard Business School By Mark McCormick
4> Confessions of an Advertising Man by David Ogilvy
5> Who Says Elephants Can't Dance? by Lou Gerstner

A brilliant list.

Erika Andersen and Danny Meyer Live

Forbes.com has video of our friend Erika Andersen (Growing Great Employees) and her ten year client Danny Meyer (Setting The Table).

Links From My Inbox - 1/29/07

• Joel Spolsky reviews Dreaming In Code
• The Los Angeles Times ran the Financial Times' review of Purpose over the weekend.
• WSJ's Carol Hymowitz has a Q&A with The Three Tensions author Ken Favaro [sub. needed].

Breakthrough Questions

In a new book called "Simple Solution" are a few questions that the authors suggest will help middle managers make an impact and stand out. They state:

"Here are some examples to practice asking breakthrough questions. After reading them, formulate at least three breakthrough questions that would initiate radical change in your department.

What would have to be true for us to lower production costs for this product by 50 percent?

What would have to be true for us to sign up 5,000 new customers next year?

What would have to be true for employee turnover to be zero?

What would have to be true to produce accurate financial statements within two days of month's end?

What would have to be true for customer service to respond to each customer call within three second?

Those are some great questions that I know I will use. You can use them for free.

Did I miss something?

On Wednesday, I posted my favorite books of 2006 and Tom McManus left a comment. He remembered us putting a lot of promotion behind Prepared Mind Of A Leader and was surprised the book had made Jack's list or mine.

Here was my response:

That is a fair question.

I liked the the book. I was a big fan because I knew it was not going to get the love it needed from the media.

It was on my list of 22 books.

It didn't meet my first critera of changing the way I viewed the world. Prepared Mind reinforced what I already believed about leadership. I think that was the reason I got excited about it.

For the honorable mentions, the books naturally fell into those three categories of firecrackers, companies, and big think. Prepared Mind didn't fit there either.

What I need to do is go back and add one more category on Nuts and Bolts. There are a couple of books that belong there.

Thanks for catching our glaring omission.

So, if you go back to my best of 2006 list, you will see a new category called Nuts and Bolts. These books are for those who need help keeping the organization running.

Good To Great For Social Sectors on Audio

If you haven't read Good To Great For Social Sectors, there is not much of an excuse. The monograph is only 42 pages and a great summary to the book.

"Well, I don't have time to read."

Yeah, I hear that one all the time. Releasing today is the audio version of this little book.

No more excuses.