1. Tom Peters’ Excellence.Always. Shanghai/25-27 April 2009

2. NOTE: To appreciate this presentation [and ensure that it is not a mess ], you need Microsoft fonts: “Showcard Gothic,” “Ravie,” “Chiller” and “Verdana”

3. AGENDA Part ONE … EXCELLENCE. ALWAYS./25.04 Part TWO … INNOVATION IMPERATIVE, the NEXT STEP/26.04 Part THREE … PEOPLE-PEOPLE-PEOPLE. PERIOD./26-7.04 Part FOUR … LEADERSHIP for EXCELLENCE & INNOVATION/27.04

5. Part TWO

6. Tom Peters’ Excellence. Always. Innovation. Shanghai/24-26 April 2009

7. Slides at … tompeters.com

8. #1

9. 1/40

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

11. “We made mistakes, of course. Most of them were omissions we didn’t think of when we initially wrote the software. We fixed them by doing it over and over, again and again. We do the same today. While our competitors are still sucking their thumbs trying to make the design perfect, we’re already on prototype version # 5. By the time our rivals are ready with wires and screws, we are on version ready with wires and screws, we are on version # 10. It gets back to planning versus acting: We act from day one; others plan how to plan— for months.” —Bloomberg by Bloomberg # 10. It gets back to planning versus acting: We act from day one; others plan how to plan— for months.” —Bloomberg by Bloomberg

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

13. “Experiment fearlessly” Tactic #1 “Experiment fearlessly” Source: BW0821.06, Type A Organization Strategies/ “How to Hit a Moving Target”— Tactic #1

14. Culture of Prototyping “Effective prototyping may be the most valuable core competence an innovative organization can hope to have.” —Michael Schrage

15. “You can’t be a serious innovator unless and until you are ready, willing and able to seriously play. ‘Serious play’ is not an oxymoron; it is the essence of innovation.” —Michael Schrage, Serious Play

16. 1% “SkunkWorks”/ “ParallelUniverse” “the 1% solution” Source: Scott Bedbury (Others: 3M, Google, Shell, NAVFAC)

17. “Fail. Forward. Fast.” “Fail. Forward. Fast.” High Tech CEO, Pennsylvania

18. “FAIL, FAIL AGAIN. FAIL BETTER.” “FAIL, FAIL AGAIN. FAIL BETTER.” —Samuel Beckett

19. “Reward Punish “Reward excellent failures. Punish mediocre successes.” Phil Daniels, Sydney exec

20. “The secret of fast progress is inefficiency, fast and furious and numerous failures.” —Kevin Kelly

21. “You miss 100% of the shots you never take.” —WayneGretzky “You miss 100% of the shots you never take.” —Wayne Gretzky

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

23. Excellence1982: The Bedrock “Eight Basics” 1. A Bias for Action 2. Close to the Customer 3. Autonomy and Entrepreneurship 4. Productivity Through People 5. Hands On, Value-Driven 6. Stick to the Knitting 7. Simple Form, Lean Staff 8. Simultaneous Loose-Tight Properties”

24. #2

25. Little = BIG

26. Big carts = 1.5X 1.5X Source: Wal*Mart

27. Bag sizes = New markets: $B $B Source: PepsiCo

28. Socks = 10,000

29. Round = 2X/all = 2X/all x

30. “Paint it white!” “Paint it white!” — On Hashem Akbari’s [Lawrence Livermore labs] powerful program to significantly reduce greenhouse gas emissions; using conservative to significantly reduce greenhouse gas emissions; using conservative assumptions, it could reduce 44 billion tons of CO2 emissions by cooling buildings, roads, entire cities (The Guardian, 0116.09) assumptions, it could reduce 44 billion tons of CO2 emissions by cooling buildings, roads, entire cities (The Guardian, 0116.09)

31. “Design is everything. Everything is design.” “We are all designers.” Inspiration: The Power of Design: A Force for Transforming Everything, Richard Farson

32. #3

33. 4/40

34. De-cent- ral-iz- a-tion!

35. “‘Decentralization’ is not a piece of paper. It’s not me. It’s either in your heart, or not.” — Brian Joffe/BIDvest

36. Enemy #1 I.C.D. Note 1: Inherent/Inevitable/ Immutable Centralist Drift Note 2: Jim Burke’s 1-word vocabulary: “No.”

37. NEW DECENTRALIZATION: “Cisco, [CEO John] Chambers argues, is the best possible model for how a global business can operate: as a distributed idea engine where leadership emerges organically, unfettered by a central command.” —”Revolution in San Jose,” Fast Company, Dec-Jan 08-09 (Chambers: “We now have a whole pool of talent who can lead these working groups—like mini CEOs and COOs.”) (Top blog: engineering director 5 levels down)

38. Ex-e- cu-tion!

39. “Execution is strategy.” —Fred Malek

40. “ Execution is the job of the business leader.” —Larry Bossidy “ Execution is the job of the business leader.” —Larry Bossidy & Ram Charan/ Execution: The Discipline of Getting Things Done

41. “Costco figured out the big, simple things and executed with total fanaticism.” —Charles Munger, Berkshire Hathaway

42. Ac-count- a-bil-ity!

43. CF: 30% (no salesfolk) MH: 80% (salesfolk)

44. 6:15A.M.

45. DECENTRALIZATION. EXECUTION. ACCOUTABILITY. 6 :15A.M.

46. Base Case

47. BIG?

48. You don’t get better by being bigger. You get worse.” Dick Kovacevich: You don’t get better by being bigger. You get worse.”

49. Buy a very large one and just wait.” “I am often asked by would-be entrepreneurs seeking escape from life within huge corporate structures, ‘How do I build a small firm for myself?’ The answer seems obvious: Buy a very large one and just wait.” —Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics

50. “Mr. Foster and his McKinsey colleagues collected detailed performance data stretching back 40 years for 1,000 U.S. companies. They found that none of the long-term survivors managed to outperform the market. Worse, the longer companies had been in the database, the worse they did.” —Financial Times

51. Forget > “Learn” “The problem is never how to get new, innovative thoughts into your mind, but how to get the old ones out.” —Dee Hock

52. “Data drawn from the real world attest to a fact that is beyond our control: —Norberto Odebrecht, Education Through Work “Data drawn from the real world attest to a fact that is beyond our control: Everything in existence tends to deteriorate.” —Norberto Odebrecht, Education Through Work

53. #4 Japan #2T USA #2T China

54. #4 Japan #3 USA #2 China #1 Germany

55. Reason!!! Mittelstand

56. Or … Goldmann Produktions (11/50%/$5M/”dip and coat,” expensive pigments vs “through coloring,” fades Bekro Chemie)

57. Jim Penman/ Jim’s Group

58. Jim’s Mowing Canada Jim’s Mowing UK Jim’s Antennas Jim’s Bookkeeping Jim’s Building Maintenance Jim’s Carpet Cleaning Jim’s Car Cleaning Jim’s Computer Services Jim’s Dog Wash Jim’s Driving School Jim’s Fencing Jim’s Floors Jim’s Painting Jim’s Paving Jim’s Pergolas [gazebos] Jim’s Pool Care Jim’s Pressure Cleaning Jim’s Roofing Jim’s Security Doors Jim’s Trees Jim’s Window Cleaning Jim’s Windscreens Note: Download, free, Jim Penman’s book: What Will They Franchise Next? The Story of Jim’s Group

59. #4

60. We are the company we keep we keep

61. “You will become like the five people you associate with the most … “You will become like the five people you associate with the most … this can be either a blessing or a curse.” —Billy Cox

62. The “We are what we eat” axiom: At its core, every (!!!) relationship-partnership decision (employee, vendor, customer, etc) is a strategic decision about: “Innovate, ‘Yes’ or ” The “We are what we eat” axiom: At its core, every (!!!) relationship-partnership decision (employee, vendor, customer, etc) is a strategic decision about: “Innovate, ‘Yes’ or ‘No’ ”

63. Measure “Strangeness”/Portfolio Quality Staff Consultants Vendors Out-sourcing Partners (#, Quality) Innovation Alliance Partners Customers Competitors (who we “benchmark” against) Strategic Initiatives Product Portfolio (LineEx v. Leap) IS/IT Projects HQ Location Lunch Mates Language Board

64. “Don’t benchmark, futuremark!” “Don’t benchmark, futuremark!” Impetus: “The future is already here; it’s just not evenly distributed” —William Gibson

65. CUSTOMERS: “ Future-defining customers may account for only 2% to 3% of your total, but they represent a crucial window on the future.” Adrian Slywotzky, Mercer Consultants

66. “[CEO A.G.] Lafley has shifted P&G’s focus on inventing all its own products to developing others’ inventions at least half the time. One successful example, Mr. Clean Magic Eraser, based on a product found in an Osaka market.” — Fortune

67. Axiom: Never use a vendor who is not in the top quartile (decile?) in their industry on R&D spending!* *Inspired by Hummingbird

68. “The Billion-man Research Team: Companies offering work to online communities are reaping the benefits of ‘crowdsourcing.’” —Headline, FT, 0110.07

69. CEO/ Goldcorp Inc./ Red Lake Source: Rob McEwen/CEO/ Goldcorp Inc./ Red Lake gold Source: Wikinomics: How Mass Collaboration Changes Everything, Don Tapscott & Anthony Williams

70. “Diverse groups of problem solvers—groups of people with diverse tools—consistently outperformed groups of the best and the brightest. If I formed two groups, one random (and therefore diverse) and one consisting of the best individual performers, the first group almost always did better. … Diversity trumped ability.” —Scott Page, The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools, and Societies Diversity

71. CM Prof Richard Florida on “Creative Capital”: “You cannot get a technologically innovative place … unless it’s open to weirdness, eccentricity and difference.” Source: New York Times/06.01.2002

72. “ The Creative Age is a wide open game.” “ The Creative Age is a wide open game.” —Richard Florida, The Rise of the Creative Class

73. 94% of loans to … women* *M icrolending; “Banker to the poor”; Grameen Bank; Muhammad Yunus; 2006 Nobel Peace Prize winner

74. 10.6

75. The Bottleneck Is at the Top of the Bottle” At the top!” “ The Bottleneck Is at the Top of the Bottle” “Where are you likely to find people with the least diversity of experience, the largest investment in the past, and the greatest reverence for industry dogma: At the top!” — Gary Hamel/Harvard Business Review

76. #5

77. X =XFX* * Excellence = Cross-functional Excellence

78. Never waste a lunch! Never waste a lunch!

79. ???? ???? % XF lunches* *Measure!

80. (Way) Underutilized Lever Space! Space! Space! Space!

81. Geologists + Geophysicists + A little bit of love = Oil

82. >100 feet = 100 miles

83. The “XF-50”: 50 Ways to Enhance Cross-Functional Effectiveness and Deliver Speed, “Service Excellence” and “Value-added Customer ‘Solutions’”* The “XF-50”: 50 Ways to Enhance Cross-Functional Effectiveness and Deliver Speed, “Service Excellence” and “Value-added Customer ‘Solutions’”* *Entire “XF-50” List is at Appendix ONE

84. #6

85. Up, Up, Up, Up the Value-added Ladder.

86. EXCELLENCE. VALUE-ADDED LADDER. NO LESS THAN “BUSINESS ADVANTAGE.”

87. “M” = $0

88. IB M : $55B* *Also HP-EDS

89. “Palmisano’s strategy is to expand tech’s borders by pushing users—and entire industries—toward radically different business models. $500 billion a year Planetary Rainmaker-in-Chief! “Palmisano’s strategy is to expand tech’s borders by pushing users—and entire industries—toward radically different business models. The payoff for IBM would be access to an ocean of revenue—Palmisano estimates it at $500 billion a year —that technology companies have never been able to touch.” —Fortune

90. “THE GIANT STALKING BIG OIL: How Schlumberger Is Rewriting the Rules of the Energy Game.”: “IPM [Integrated Project Management] strays from [Schlumberger’s] traditional role as a service provider and moves deeper into areas once dominated by the majors.” Source: BusinessWeek cover story, January 2008

91. “Big Brown’s New Bag: UPS Aims to Be the Traffic Manager for Corporate America” —Headline/BW “UPS wants to take over the sweet spot in the endless loop of goods, information and capital that all the packages [it moves] represent.” —ecompany.com (E.g., UPS Logistics manages the logistics of 4.5M Ford vehicles, from 21 mfg. sites to 6,000 NA dealers)

92. Huge: Satisfaction Success Huge: Customer Satisfaction versus Customer Success

93. The Value-added Ladder Services (USA, EU) Goods (China, Germany, Japan) Raw Materials

94. The Value-added Ladder/TRANSFORMATION Customer Success/ Gamechanging Solutions Services Goods Raw Materials

95. Era #1/Obvious Value : “Our ‘it’ works, is delivered on time” (“Close”) Era #2/Augmented Value : “How our ‘it’ can add value—a ‘useful it’ ” (“Solve”) Era #3/Complex Value Networks : “How our ‘system’ can change you and deliver ‘business advantage ’ ” (“Culture- Strategic change”) Era #1/Obvious Value : “Our ‘it’ works, is delivered on time” (“Close”) Era #2/Augmented Value : “How our ‘it’ can add value—a ‘useful it’ ” (“Solve”) Era #3/Complex Value Networks : “How our ‘system’ can change you and deliver ‘business advantage ’ ” (“Culture- Strategic change”) Source: Jeff Thull, The Prime Solution: Close the Value Gap, Increase Margins, and Win the Complex Sale

96. Centerpiece: PSF* *Professional Services Firm

97. “Principal Engine of Value Added” Are you the … “Principal Engine of Value Added”

98. PSF/Professional Service Firm/Beliefs Profession: Calling/Passion to make a difference/Excellence (always) point of view: know exactly what we stand for/ “Dramatic Difference” Client: enduring, test-the-limits relationship/Trusted advisor Solution: Rock His-her World/ “wow” / implemented “Culture change”/ >>>>>> “satisfaction” PSF/Professional Service Firm/Beliefs Profession: Calling/Passion to make a difference/Excellence (always) point of view: know exactly what we stand for/ “Dramatic Difference” Client: enduring, test-the-limits relationship/Trusted advisor Solution: Rock His-her World/ “wow” / implemented “Culture change”/ >>>>>> “satisfaction”

99. Iron Innovation Equality Law: The quality and quantity and imaginativeness of innovation shall be the same in all functions —e.g., in HR and purchasing as much as in marketing or product development.

100. EXCELLENCE. VALUE-ADDED LADDER. SPELLBINDING EXPERIENCES POWERED BY “SOULFUL” DESIGN.

101. “ Experiences are as distinct from services as services are from goods.” “ Experiences are as distinct from services as services are from goods.” —Joe Pine & Jim Gilmore, The Experience Economy: Work Is Theatre & Every Business a Stage

102. It BEGINS (and ENDS ) in the …

103. parking lot* *Disney

104. The case of the 2-cent candy The case of the 2-cent candy

105. TGR [Things Gone -Things Gone ] TGR [Things Gone WRONG -Things Gone RIGHT ]

106. C X O C X O* *Chief e X perience Officer

107. Acquire vs maintain*: 5X *Recession goal: Higher “market share” current customers current customers

108. The Value-added Ladder/ MEMORABLE CONNECTIONS Spellbinding Experiences Powered By “Soulful” Design* * Customer Success/ Implemented Gamechanging Solutions Services Goods Raw Materials *Blending Beauty, Usability, Theatricality (Degree: MFA/ Master of Fine Arts, “D-school,” Cultural Anthropology)

109. “Design is treated like a religion at BMW.” —Fortune

110. All Equal Except … “At Sony we assume that all products of our competitors have basically the same technology, price, performance and features. Design is the only thing that differentiates one product from another in the marketplace.” —Norio Ohga

111. “We don’t have a good language to talk about this kind of thing. In most people’s vocabularies, design means veneer. … But to me, nothing could be further from the meaning of design. Design is the fundamental soul of a man-made creation.” —Steve Jobs

112. “With its carefully conceived mix of colors and textures, aromas and music, Starbucks is more indicative of our era than the iMac. It is to the Age of Aesthetics what McDonald’s was to the Age of Convenience or Ford was to the Age of Mass Production—the touchstone success story, the exemplar of … the aesthetic imperative. … ‘Every Starbucks store is carefully designed to enhance the quality of everything the customers see, touch, hear, smell or taste,’ writes CEO Howard Schultz.” “With its carefully conceived mix of colors and textures, aromas and music, Starbucks is more indicative of our era than the iMac. It is to the Age of Aesthetics what McDonald’s was to the Age of Convenience or Ford was to the Age of Mass Production—the touchstone success story, the exemplar of … the aesthetic imperative. … ‘Every Starbucks store is carefully designed to enhance the quality of everything the customers see, touch, hear, smell or taste,’ writes CEO Howard Schultz.” -—Virginia Postrel, The Substance of Style: How the Rise of Aesthetic Value Is Remaking Commerce, Culture and Consciousness

113. Axiom: DESIGN is the PRINCIPAL DIFFERENTIATOR between “LOVE” and “HATE”!

114. Message: Men cannot design for women’s needs.

115. #7

116. “Forget China, India and the Internet : Economic Growth Is Driven by Women.” Source: Headline, Economist

117. “Since 1970, women have held two out of every three new jobs created.” “Since 1970, women have held two out of every three new jobs created.” —FT, 10.03.2006

118. “Women are the majority market” —Fara Warner/The Power of the Purse

119. “The most significant variable in every sales situation is the gender of the buyer, and more importantly, how the salesperson communicates to the buyer’s gender.” “The most significant variable in every sales situation is the gender of the buyer, and more importantly, how the salesperson communicates to the buyer’s gender.” —Jeffery Tobias Halter, Selling to Men, Selling to Women

120. The Perfect Answer Jill and Jack buy slacks in black…

122. Cases! Cases! Cases! McDonald’s Home Depot P&G DeBeers AXA Financial Kodak Nike Avon Bratz Fara Warner/The Power of the Purse Cases! Cases! Cases! McDonald’s (“mom-centered” to “majority consumer”; not via kids) Home Depot (“Do it [everything!] Herself”) P&G (more than “house cleaner”) DeBeers (“right-hand rings”/$4B) AXA Financial Kodak (women = “emotional centers of the household”) Nike (> jock endorsements; new def sports; majority consumer) Avon Bratz (young girls want “friends,” not a blond stereotype) Source: Fara Warner/The Power of the Purse

123. They join them.” “Women don’t buy brands. They join them.” EVEolution

124. 2.6 vs. 21

125. “People powered”: Age 3 days, baby girls 2X eye contact. Source: Martha Barletta, Marketing to Women

126. “ Women speak and hear a language of connection and intimacy, and men speak and hear a language of status and independence. Men communicate to obtain information, establish their status, and show independence. Women communicate to create relationships, encourage interaction, and exchange feelings.” “ Women speak and hear a language of connection and intimacy, and men speak and hear a language of status and independence. Men communicate to obtain information, establish their status, and show independence. Women communicate to create relationships, encourage interaction, and exchange feelings.” —Judy Rosener, America’s Competitive Secret

127. “Goldman Sachs in Tokyo has developed an index of 115 companies poised to benefit from women’s increased purchasing power; over the past decade the value of shares in Goldman’s basket has risen by 96%, against the Tokyo stockmarket’s rise of 13%.” “Goldman Sachs in Tokyo has developed an index of 115 companies poised to benefit from women’s increased purchasing power; over the past decade the value of shares in Goldman’s basket has risen by 96%, against the Tokyo stockmarket’s rise of 13%.” —Economist, April 15

128. “AS LEADERS, WOMEN RULE: TITLE/ Special Report/ BusinessWeek “AS LEADERS, WOMEN RULE: New Studies find that female managers outshine their male counterparts in almost every measure” TITLE/ Special Report/ BusinessWeek

129. 10 UNASSAILABLE REASONS WOMEN RULE Women Women Women make [all] the financial decisions. Women control [all] the wealth. Women Women [substantially] outlive men. Women Women start most of the new businesses. Women’s Women’s work force participation rates have soared worldwide. Women Women are closing in on “same pay for same job.” Women Women are penetrating senior ranks rapidly [even if the pace is slow for the corner office per se]. Women’s Women’s leadership strengths are exceptionally well aligned with new organizational effectiveness imperatives. Women Women are better salespersons than men. Women Women buy [almost] everything—commercial as well as consumer goods. So what exactly is the point of men?

130. “One thing is certain: Women’s rise to power, which is linked to the increase in wealth per capita, is happening in all domains and at all levels of society. Women are no longer content to provide efficient labor or to be consumers with rising budgets and more autonomy to spend. … This is just the beginning. The phenomenon will only grow as girls prove to be more successful than boys in the school system. For a number of observers, we have already entered the age of ‘womenomics,’ the economy as thought out and practiced by a woman.” “One thing is certain: Women’s rise to power, which is linked to the increase in wealth per capita, is happening in all domains and at all levels of society. Women are no longer content to provide efficient labor or to be consumers with rising budgets and more autonomy to spend. … This is just the beginning. The phenomenon will only grow as girls prove to be more successful than boys in the school system. For a number of observers, we have already entered the age of ‘womenomics,’ the economy as thought out and practiced by a woman.” —Aude Zieseniss de Thuin, Financial Times, 10.03.2006

131. “ ‘Womenomics,’ the economy as thought out and practiced by a woman.” —Aude Zieseniss de Thuin, Financial Times, 10.03.2006

132. #8

133. !!!!!!!!!!!!!!!!! “People turning 50 today have more than half of their adult life ahead of them.” “People turning 50 today have more than half of their adult life ahead of them.” —Bill Novelli, 50+: Igniting a Revolution to Reinvent America

134. 7/13

135. “New Customer Majority” 44-65: “New Customer Majority” * *45% larger than 18-43; 60% larger by 2010 Source: Ageless Marketing, David Wolfe & Robert Snyder

136. “ Marketers attempts at reaching those over 50 have been miserably unsuccessful. No market’s motivations and needs are so poorly understood.” —Peter Francese, founding publisher, American Demographics

137. “Baby-boomer Women : The Sweetest of Sweet Spots for Marketers” “Baby-boomer Women : The Sweetest of Sweet Spots for Marketers” —David Wolfe and Robert Snyder, Ageless Marketing

138. We are the Aussies & Kiwis & Americans & Canadians. We are the Western Europeans & Japanese. We are the fastest growing, the biggest, the wealthiest, the boldest, the most (yes) ambitious, the most experimental & exploratory, the most different, the most indulgent, the most difficult & demanding, the most service & experience obsessed, the most vigorous, (the least vigorous,) the most health conscious, the most female, the most profoundly important commercial market in the history of the world—and we will be the Center of your universe for the next twenty-five years. We have arrived!

139. #9

140. The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World By Amar Bhidé

141. Sustainable Innovation: Systemic. Very complex. The NECESSARY COMBINATION (very dense network) of EVERYTHING from the development of the Basic Science to numerous INTERMEDIATE Stages to Sales Recruiting and Training and Ads. Essential: Clever and numerous AGGRESSIVE CONSUMERS* (“venturesome consumption”). Path to success or failure … UNPREDICTABLE. FYI: The World is NOT FLAT. World is NOT FLAT. *From Transistor at Bell Labs to on-line gamers. Source: Amar Bhidé, The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World

142. Sustainable Innovation: Systemic. Very complex. The COMBINATION (very dense network) of EVERYTHING from the Basic Science * to Sales Recruiting and Training and Ads. Essential: Clever and numerous PIONEER CONSUMERS (“venturesome consumption”). Path to success or failure … UNPREDICTABLE. from the Basic Science * to Sales Recruiting and Training and Ads. Essential: Clever and numerous PIONEER CONSUMERS (“venturesome consumption”). Path to success or failure … UNPREDICTABLE. *Of modest value [& origin mostly irrelevant] unless the ENTIRE INNOVATION CHAIN is in place and aggressively interacting-competing. irrelevant] unless the ENTIRE INNOVATION CHAIN is in place and aggressively interacting-competing. Source: Amar Bhidé, The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World Innovation Sustains Prosperity in a More Connected World

143. Sustainable Innovation /“Breakthrough Ideas”: (1) High # of Stages/Stages- within Stages within Stages (1) Importance of Intermediate Stages Intermediate Stages (3) Engaged Mega-scrum of Users/Consumers of Users/Consumers as Participative/Decisive as Participative/Decisive “Pull” Mechanism (e.g., UPS “Pull” Mechanism (e.g., UPS vs. FedEx) vs. FedEx) Source: Amar Bhidé, The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World Sustains Prosperity in a More Connected World

144. 1913: 32%* 1960: 26% 1980: 22% 2000: 27% 2007: 26% Source: “The Future of American Power,” Fareed Zakaria, Foreign Affairs, vol 87, no. 3 Fareed Zakaria, Foreign Affairs, vol 87, no. 3 *U.S. share of world output

145. #10

146. Innovation Index: Top 5 8 or higher “Weird”/ “Profound”/ “Wow”/“Game- changer” Innovation Index: How many of your Top 5 Strategic Initiatives/Key Projects score 8 or higher [out of 10] on a “Weird”/ “Profound”/ “Wow”/“Game- changer” Scale?

147. Appendix ONE The “XF-50”: 50 Ways to Enhance Cross-Functional Effectiveness and Deliver Speed, “Service Excellence” and “Value-added Customer ‘Solutions’”

148. 1. It’s our organization to make work—or not. It’s not “them,” the outside world that’s the problem. The enemy is us. Period. 2. Friction-free! Dump 90% of “middle managers”—most are advertent or inadvertent “power freaks.” We are all—every one of us—in the Friction Removal Business, one moment at a time, now and forevermore. 3. No “stovepipes”! “Stove-piping,” “Silo-ing” is an Automatic Firing Offense. Period. No appeals. (Within the limits of civility, somewhat “public” firings are not out of the question—that is, make one and all aware why the axe fell.) 4. Everything on the Web. This helps. A lot. (“Everything” = Big word.) 5. Open access. All available to all. Transparency, beyond a level that’s “sensible,” is a de facto imperative in a Burn-the-Silos strategy. 6. Project managers rule!! Project managers running XF (cross-functional) projects are the Elite of the organization, and seen as such and treated as such. (The likes of construction companies have practiced this more or less forever.) 7. “Value-added Proposition” = Application of integrated resources. (From the entire supply-chain.) To deliver on our emergent business raison d’etre, and compete with the likes of our Chinese and Indian brethren, we must co-operate with anybody and everybody “24/7.” IBM, UPS and many, many others are selling far more than a product or service that works— the new “it” is pure and simple a product of XF co-operation; “the product is the co-operation” is not much of a stretch.

149. 8. “XF work” is the direct work of leaders! 9. “Integrated solutions” = Our “Culture.” (Therefore: XF = Our culture.) 10. Partner with “best-in-class” only. Their pursuit of Excellence helps us get beyond petty bickering. An all-star team has little time for anything other than delivering on the (big) Client promise. 11. All functions are created equal! All functions contribute equally! All = All. 12. All functions are “PSFs,” Professional Service Firms. “Professionalism” is the watchword—and true Professionalism rise above turf wars. You are your projects, your legacy is your projects—and the legacy will be skimpy indeed unless you pass, with flying colors, the “works well with others” exam! 13. We are all in sales! We all (a-l-l) “sell” those Integrated Client Solutions. Good salespeople don’t blame others for screw-ups—the Client doesn’t care. Good salespeople are “quarterbacks” who make the system work- deliver. 14. We all invest in “wiring” the Client organization—we develop comprehensive relationships in every part (function, level) of the Client’s organization. We pay special attention to the so-called “lower levels,” short on glamour, long on the ability to make things happen at the “coalface.” 15. We all “live the Brand”—which is Delivery of Matchless Integrated Solutions which transform the Client’s organization. To “live the brand” is to become a raving fan of XF co-operation.

150. 16. We use the word “partner” until we want to barf! (Words matter! A lot!) 17. We use the word “team” until we want to barf. (Words matter! A lot!) 18. We use the word “us” until we want to barf. (Words matter! A lot!) 19. We obsessively seek Inclusion—and abhor exclusion. We want more people from more places (internal, external—the whole “supply chain”) aboard in order to maximize systemic benefits. 20. Buttons & Badges matter—we work relentlessly at team (XF team) identity and solidarity. (“Corny”? Get over it.) 21. All (almost all) rewards are team rewards. 22. We keep base pay rather low—and give whopping bonuses for excellent team delivery of “seriously cool” cross-functional Client benefits. 23. WE NEVER BLAME OTHER PARTS OF THE ORGANIZATION FOR SCREWUPS. 24. WE TAKE THE HEAT—THE WHOLE TEAM. (For anything and everything.) (Losing, like winning, is a team affair.) 25. “BLAMING” IS AN AUTOMATIC FIRING OFFENSE. 26. “Women rule.” Women are simply better at the XF communications stuff—less power obsessed, less hierarchically inclined, more group-team oriented.

151. 27. Every member of our team is an honored contributor. “XF project Excellence” is an “all hands” affair. 28. We are our XF Teams! XF project teams are how we get things done. 29. “Wow Projects” rule, large or small—Wow projects demand by definition XF Excellence. 30. We routinely attempt to unearth and then reward “small gestures” of XF co-operation. 31. We invite Functional Bigwigs to our XF project team reviews. 32. We insist on Client team participation—from all functions of the Client organization. 33. An “Open talent market” helps make the projects “silo-free.” People want in on the project because of the opportunity to do something memorable—no one will tolerate delays based on traditional functional squabbling. 34. Flat! Flat = Flattened Silos. Flat = Excellence based on XF project outcomes, not power-hoarding within functional boundaries. 35. New “C-level”? We more or less need a “C-level” job titled Chief Bullshit Removal Officer. That is, some kind of formal watchdog whose role in life is to make cross-functionality work, and I.D. those who don’t get with the program. 36. Huge (H-U-G-E) co-operation bonuses. Senior team members who conspicuously shine in the “working together” bit are rewarded Big Time. (A million bucks in one case I know—and a non-cooperating very senior was sacked.)

152. 37. Get physical!! “Co-location” is the most powerful “culture changer. Physical X-functional proximity is almost a guarantee (yup!) of remarkably improved co-operation—to aid this one needs flexible workspaces that can be mobilized for a team in a flash. 38. Ad hoc. To improve the new “X-functional Culture,” little XF teams should be formed on the spot to deal with an urgent issue—they may live for but ten days, but it helps the XF habit, making it normal to be “working the XF way.” 39. “Deep dip.” Dive three levels down in the organization to fill a senior role with some one who has been pro-active on the XF dimension. 40. Formal evaluations. Everyone, starting with the receptionist, should have an important XF rating component in their evaluation. 41. Demand XF experience for, especially, senior jobs. The military requires all would-be generals and admirals to have served a full tour in a job whose only goals were cross-functional. Great idea! 42. Early project “management” experience. Within days, literally, of coming aboard folks should be “running” some bit of a project, working with folks from other functions—hence, “all this” becomes as natural as breathing. 43. “Get ’em out with the customer.” Rarely does the accountant or bench scientist call one the customer. Reverse that. Give everyone more or less regular “customer-facing experiences.” One learns quickly that the customer is not interested in our in-house turf battles!

153. 44. Put “it” on the–every agenda. XF “issues to be resolved” should be on every agenda—morning project team review, weekly exec team meeting, etc. A “next step” within 24 hours (4?) ought to be part of the resolution. 45. XF “honest broker” or ombudsman. The ombudsman examines XF “friction events” and acts as Conflict Resolution Counselor. (Perhaps a formal conflict resolution agreement?) 46. Lock it in! XF co-operation, central to any value-added mission, should be an explicit part of the “Vision Statement.” 47. Promotions. Every promotion, no exceptions, should put XF Excellence in the top 5 (3?) evaluation criteria. 48. Pick partners based on their “co-operation proclivity.” Everyone must be on board if “this thing” is going to work; hence every vendor, among others, should be formally evaluated on their commitment to XF transparency—e.g., can we access anyone at any level in any function of their organization without bureaucratic barriers? 49. Fire vendors who don’t “get it”—more than “get it,” welcome “it” with open arms.” 50. Jaw. Jaw. Jaw. Talk XF cooperation-value-added at every opportunity. Become a relentless bore! 51. Excellence! There is a state of XF Excellence per se. Talk about it. Pursue it. Aspire to nothing less.