The demand for results – and results now – is ever more strident. In the face of intensifying pressure, it is easy to lose sight of ...
The demand for results – and results now – is ever more strident. In the face of intensifying pressure, it is easy to lose sight of firsttprinciples. Stuart Crainer returns to the basics.
How do businesses produce extraordinary results? This single question lies at the heart of the mountain of business books, case studies, executive education courses and much more produced every year. Results are the Holy Grail of the business world, enticing, but perennially difficult and often out of reach. Results are the raison d’etre of organisations and individuals. And yet, the catalogue of failed companies, disappointed entrepreneurs, frustrated leaders and cynical executives grows year by year.
To some extent this is a fact of life. By definition, we can’t all be winners. But, there is another story here. We actually know a surprising amount about what it takes to achieve extraordinary results. Yet the first principles are not universally or even regularly acknowledged. They may also be regarded by some as anodyne, as common sense, but they do exist, gathering dust under the detritus of business literature, pontification and “best practice”. The starting point on the route to delivering results must be awareness of these first principles, the seven principles of extraordinary results:
1. There is no recipe.
Business books are largely recipe books. Trouble is there is no universal recipe for business success. Ingredients always differ. What works for one company does not work for another. What works today will not work tomorrow.
Think back to the first business blockbuster, In Search of Excellence. The intellectual cornerstones of In Search of Excellence are eight principles identified by Tom Peters and Robert Waterman as characteristics of excellent companies. These are: a bias for action; being close to the customer; autonomy and entrepreneurship; productivity through people; being hands-on and values driven; sticking to the knitting; simple form, lean staff; and, what they ingloriously labelled, simultaneous loosetight properties.
Peters and Waterman examined 62 companies against these principles. Soon after, BusinessWeek’s front page story was “Ooops!” celebrating the fact that many of the companies judged excellent by Peters and Waterman had stumbled. Arco was bought by British Petroleum; NCR was bought by AT&T; Western Electric evolved into Lucent Technologies; Westinghouse slowly disintegrated and disappeared; Allen-Bradley was purchased by Rockwell; Chesebrough-Ponds was bought by Unilever; Data General was bought by EMC; Hughes Aircraft merged with Raytheon; Raychem was bought by Tyco; Standard Oil (Indiana)/Amoco was bought by BP; and Wang Labs filed for bankruptcy in 1992 before being resurrected and sold to Gerontics. Atari, which the authors say mistakenly made the list ("we were swept up in the frenzy,” says Waterman), was bought by Hasbro in 1998, and is now part of Warner Communications.
Recipes for results are always retrospective. They make sense of the morass of results and proclaim a solution. Unfortunately, there isn’t one. This does not stop publishers cashing in on the wishful thinking of millions of executives that they can turn their small machine tool business in Poland into General Electric by learning Jack Welch’s business secrets.
2. You have to be different.
No organisation ever delivered extraordinary results by doing things in the same way as the competition. One way or another they do things differently.
In their book, Simply Better, Patrick Barwise and Seán Meehan persuasively argue that difference need not be some earth-shatteringly original bright idea, but that it can be based on doing small things better than the competition. Instead of trying to change the marketplace, the route to delivering difference lies in dedication to continuing incremental improvements. After all, this lies at the heart of the success of one of the world’s few companies which has delivered extraordinary results over the last half century: Toyota.
One of the mistakes has been to assume that difference also requires companies to be first. Not so. As Costas Markides, co-author of Fast Second, argues, being first is not necessarily the route to corporate nirvana. “Consider the market for PCs. Who is the ‘innovator’ in this market?” asks Markides. “Most people think that the answer is Apple or perhaps Osborne. But who really created the mass market for PCs? Who is to be credited that the personal computer is not some high-tech gimmick that only nerds use but it is instead a fixture in every home? The answer is simple – IBM. They scaled it up. They created the mass market. Yet, nobody considers IBM as an innovator.
“The trouble is that while coming up with ideas is celebrated as innovative, the act of scaling them up into big markets is not. Even worse, scaling up rather than coming up with new ideas is what big companies are good at. Unfortunately, they often forget this and try instead to become brilliantly creative like the small start-up firms. Instead of taking the ideas of others and converting them into big markets, they focus on coming up with ideas themselves. Unfortunately, this is what small firms excel at.”
3. Results demand leadership.
The link between leadership and results has been analysed from every angle imaginable. What can be said is that extraordinary – or even acceptable – results are unlikely without some degree of leadership.