Tom Peters 2002 We Are In A Brawl With No Rules! MASTER/03.17.2002.

Tom Peters 2002 We Are In A Brawl With No Rules! MASTER/03.17.2002

All Slides Available at … tompeters.com

More at … tompeters.com Slides from this seminar; Master Presentation, for in-depth; annotated Special Presentations [Women Rule!, Design!, etc.]. Cool Friends (referenced in seminar). Discussions re this stuff. Calendar of events. Note: Lavender text in this file is a link.

CONTEXT

Confusion Reigns.

There will be more confusion in the business world in the next decade than in any decade in history. And the current pace of change will only accelerate. Steve Case

The Age of …Chaos/Convulsion/Re- definition/Risk/Opportunity: Kmart … Gap … DVDs: Wal*Mart vs. Blockbuster/Warner vs. The World … AOL TimeWarner … Enron … UAL/Leasing & Balance sheets … Andersen … Credibility/ Intangibles/ Intellectual Property/ Branding … Service sector productivity … Cisco … Tyco … Global Crossing … IBM procures $45B (90%) on the Web, saves 0.5B … IBM & Web ed … 401(k)s … Job & Work & employment Redefinition … Security/Uncertainty/Terrorism … Infotech/Biotech … Etc. … Etc.

N.W.O./Age of Ephemeral: With lots of sentiment and image built into the Harley stock, even slight hints of trouble can send it into a violent slide. Source: BW/02.11.2002

Amazon does profit: Employment the same with 35% more shipments … Inventory down 18%, while sales grew 15% … 40% consolidated full-truck shipments, up from 0% … etc. Source: BW/02.04.02

Uncertainty: We dont know when things will get back to normal. Ambiguity: We no longer know what normal means.

BMcC: (1) Hierarchy vs. Network organization. (2) NWO = Doctrine as center of gravity/source of motivation; distributed support & decision- making;largely self-organizing; outside the military sphere.

Per capita scientists: 12,000-60,000 per 1,000,000 in developed world. 1 per 4,000,000 in Muslim countries. (Ratio = 144,000:1) Source: FT 20Oct2001

From: Weapon v. Weapon To: Org structure v. Org structure

Our military structure today is essentially one developed and designed by Napoleon. Admiral Bill Owens, former Vice Chairman, Joint Chiefs of Staff

In an era when terrorists use satellite phones and encrypted email, US gatekeepers stand armed against them with pencils and paperwork, and archaic computer systems that dont talk to each other. Boston Globe (09.30.2001)

One of the 19 hijackers was stopped by a Maryland state trooper before September 11 but was released because the trooper had no way of knowing the man was on a CIA terrorist watch list. Source: AP (12.12.2001)

Per capita scientists: 12,000-60,000 per 1,000,000 in developed world. 1 per 4,000,000 in Muslim countries. (Ratio = 144,000:1) Source: FT 20Oct2001

prior 900 years 1900s: 1 st 20 years > 1800s 2000: 10 years for paradigm shift 21 st century: 1000X tech change than 20 th century (the Singularity, a merger between humans and computers that is so rapid and profound it represents a rupture in the fabric of human history) Ray Kurzweil

1 day 2001 = Years trade in 1949, years FEX in 1979, years global calls in 1984. Source: Charles Handy, The Elephant and the Flea

7 Rules for Leading/THRIVING in a Recession+ 1. Its ALREADY too late. 2. Show up & tell the truthCREDIBILITY rules. 3. Kill with KINDNESS. 4. Sharp pencils are imperativebut dont forget that the CUSTOMER & our TALENT & RISKY INVESTMENTS are still our long-term Bread & Butter. 5. Everythings different, everythings the sameits the NEW ECONOMY, more than ever, stupid! 6. Use the trauma to mount the bold initiatives you should have long before mounted: Flux = OPPORTUNITY. 7. Were in a War of Organizational Modelsfrom retail to the Pentagon. IDEAS MATTER MOST.

The Destruction Imperative.

Forbes100 from 1917 to 1987: 39 members of the Class of 17 were alive in 87; 18 in 87 F100; 18 F100 survivors underperformed the market by 20%; just 2 (2%), GE & Kodak, outperformed the market 1917 to 1987. S&P 500 from 1957 to 1997: 74 members of the Class of 57 were alive in 97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997. Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market

Message*: Are all CEOs bozos? Was Darwin a genius, or what? So, Boss, whaddaya say about risk taking now? *And all that (2 of 100; 12 of 500) was in relatively placid times.

CEOs appointed after 1985 are 3X more likely to be fired than CEOs appointed before 1985 Warren Bennis, MIT Sloan Management Review

Good management was the most powerful reason [leading firms] failed to stay atop their industries. Precisely because these firms listened to their customers, invested aggressively in technologies that would provide their customers more and better products of the sort they wanted, and because they carefully studied market trends and systematically allocated investment capital to innovations that promised the best returns, they lost their positions of leadership. Clayton Christensen, The Innovators Dilemma

A pattern emphasized in the case studies in this book is the degree to which powerful competitors not only resist innovative threats, but actually resist all efforts to understand them, preferring to further their positions in older products. This results in a surge of productivity and performance that may take the old technology to unheard of heights. But in most cases this is a sign of impending death. Jim Utterback, Mastering the Dynamics of Innovation

The 1990s was a decade of multiple revolutionspolitical, economic, technological that changed so thoroughly the way we live that the past no longer seems a good guide to the future (in fact the past seems precisely the wrong guide). So it is in the world of military affairs. The RMA is our opportunity to use the new information technology to change the very nature of the militaryin a way that could reinvigorate American political, diplomatic and economic leadership in the world for decades to come. –Bill Owens, Lifting the Fog of War

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

Japans Science Gap * Rice farming culture: Uniqueness suppressed. Govt control of R & D. Promotion based on seniority. Consensus vs. debate. (U.S.: friends can be mortal enemies.) Bias for C.I. vs. bold leaps. Lack of competition and critical evaluation (peer review). Syukuro Manabe:What we need to create is job insecurity rather than security to make people compete more. *Hideki Shirakawa, Nobel laureate, chemistry

The [New] G e Way DYB.com

Wendell Phillips, abolitionist: Republics exist only on the tenure of being constantly agitated. There is no republican road to safety but in constant distrust. Source: Louis Menand, The Metaphysical Club: A Story of Ideas in America

The Gales of Creative Destruction +29M = -44M + 73M +4M = +4M - 0M

Axiom (Hypothesis): We have been screwed by Benchmarking … Best Practice … C.I./Kaizen. Axiom (Hypothesis): We need Masters of Discontinuity/ Masters of Ambiguity … in discontinuous/ambiguous times.

The secret of fast progress is inefficiency, fast and furious and numerous failures. Kevin Kelly

Active mutators in placid times tend to die off. They are selected against. Reluctant mutators in quickly changing times are also selected against. Carl Sagan & Ann Druyan, Shadows of Forgotten Ancestors

Chivalry is dead. The new code of conduct is an active strategy of disrupting the status quo to create an unsustainable series of competitive advantages. This is not an age of defensive castles, moats and armor. It is rather an age of cunning, speed and surprise. It may be hard for some to hang up the chain mail of sustainable advantage after so many battles. But hypercompetition, a state in which sustainable advantages are no longer possible, is now the only level of competition. Rich DAveni, Hypercompetition: Managing the Dynamics of Strategic Maneuvering

Acquisitions are about buying market share. Our challenge is to create markets. There is a big difference. Peter Job, CEO, Reuters

When asked to name just one big merger that had lived up to expectations, Leon Cooperman, former cochairman of Goldman Sachs Investment Policy Committee, answered: Im sure there are success stories out there, but at this moment I draw a blank. Mark Sirower, The Synergy Trap

Lessons from the Bees! Since merger mania is now the rage, what lessons can the bees teach us? A simple one: Merging is not in nature. [Natures] process is the exact opposite: one of growth, fragmentation and dispersal. There is no megalomania, no merging for mergings sake. The point is that unlike corporations, which just get bigger, bee colonies know when the time has come to split up into smaller colonies which can grow value faster. What the bees are telling us is that the corporate world has got it all wrong. David Lascelles, Co-director of The Centre for the Study of Financial Innovation [UK]

Terror cells are superb, malevolent examples of what Information Age organizations can be. So how do you kill them? … Soldiers used to idolize Napoleon or Patton. Network-centric warriors admire Wal*Mart for using information superiority to crush rivals. … [The Navys John] Arquilla calls for small, fast, information- enabled units. –Americas Secret Weapon, Business 2.0 (DEC2001)

A White Collar Revolution.

108 X 5 vs. 8 X 1 = 540 vs. 8 (-98.5%)

The Pincer 5 1. Destructive entrepreneurs/ Global Competition 2. White Collar Robots 3. THE INTERNET! [E.g.: GM + Ford + DaimlerChrysler] 4. Global Outsourcing [E.g.: India, Mexico] 5. Speed!!

Automation+ 75% of what we do: 40 expert decision rules!

IBMs Project eLiza!* * Self-bootstrapping/ Artilects

E.g. … Jeff Immelt: 75% of admin, back room, finance digitalized in 3 years. Source: BW (01.28.02)

Unless mankind redesigns itself by changing our DNA through altering our genetic makeup, computer- generated robots will take over the world. – Stephen Hawking, in the German magazine Focus

Within thirty years, we will have the technological means to create superhuman intelligence. Shortly after, the human era will be ended. Vernor Vinge, NASA Vision-21 Symposium (quoted in Damien Broderick, The Spike)

Read It: Ray Kurzweil, The Age of the Spiritual Machine.

The Pincer 5 1. Destructive entrepreneurs/ Global Competition 2. White Collar Robots 3. THE INTERNET! [E.g.: GM + Ford + DaimlerChrysler] 4. Global Outsourcing [E.g.: India, Mexico] 5. Speed!!

N.W.O./Holy Moly: Unemployment up 2% … Real wage growth highest since 60s … Productivity soaring. Source: BW/02.11.2002

So what does Drexels demise tell us about Enron? Companies may die (or commit suicide), but ideasif theyre any good survive. James Surowiecki, The New Yorker

IS/IT/Web … On the Bus or Off the Bus.

Dells OptiPlex Facility Big Job: 6 to 8 hours. (80,000 per day) Parts Inventory: 100 square feet.

Amazon does profit: Employment the same with 35% more shipments … Inventory down 18%, while sales grew 15% … 40% consolidated full-truck shipments, up from 0% … etc. Source: BW/02.04.02

Cisco! 90% of $20B (=$50M/day) Annual savings in service and support from customer self-management: $550M (P.S.: C.Sat e >> C.Sat h)

Secret Cisco: Community! Customer Engineer Chat Rooms/Collaborative Design ($1B free consulting) (45,000 customer problems a week solved via customer collaboration)

The Real News: X1,000,000 TowTruckNet.com

Webcor. Construction. Web site for each project. Instant info on status to employees, subs, architects. Mgt costs cut by 2/3rds. Huge time shrinkage. Source: Business Week (09.00)

New Politics: ewg.org* *Environmental Working Groupstats on recipients of farm subsidies

Welcome to D.I.Y. Nation: Changes in business processes will emphasize self service. Your costs as a business go down and perceived service goes up because customers are conducting it themselves. Ray Lane, Oracle

Psych 101: Strongest Force on Earth? My need to be in perceived control of my universe!

WebWorld = Everything Web as a way to run your businesss innards Web as connector for your entire supply-demand chain Web as spiders web which re-conceives the industry Web/B2B as ultimate wake-up call to commodity producers Web as the scourge of slack, inefficiency, sloth, bureaucracy, poor customer data Web as an Encompassing Way of Life Web = Everything (P.D. to after-sales) Web forces you to focus on what you do best Web as entrée, at any size, to Worlds Best at Everything as next door neighbor

Message: eCommerce is not a technology play! It is a relationship, partnership, organizational and communications play, made possible by new technologies.

Message: There is no such thing as an effective B2B or Internet-supply chain strategy in a low-trust, bottlenecked- communication, six-layer organization.

Ebusiness is about rebuilding the organization from the ground up. Most companies today are not built to exploit the Internet. Their business processes, their approvals, their hierarchies, the number of people they employ … all of that is wrong for running an ebusiness. Ray Lane, Kleiner Perkins

Q : Is that all there is? A : Quite possibly. Roches New Scientific Method Fast Company. And? X-Functional Teams (NO STOVEPIPES!). Fail fast. The only way to embrace a technological revolution, Roche has discovered, is to unleash an organizational revolution.

Jargon Bath! Bureaucracy free … Systemically integrated … Internet intense … Knowledge based … Time and location free … Instantly responsive … Customer centric … Mass customization enabled.

Translation … Bureaucracy free = Flat org, no B.S. Systemically integrated = Whole supply chain tightly wired/ friction free Internet intense = Do it all via the Web Knowledge based = Open access Time and location free = Whenever, wherever Instantly responsive = Speed demons Customer centric = Customer calls the shots Mass customization enabled = Every product and service rapidly tailored to client requirements

Supply Chain 2000: When Joe Employee at Company X launches his browser, hes taken to Company Xs personalized home page. He can interact with the entire scope of Company Xs world – customers, other employees, distributors, suppliers, manufacturers, consultants. The browser – that is, the portal – resembles a My Yahoo for Company X and hooks into every network associated with Company X. The real trick is that Joe Employee, business partners and customers dont have to be in the office. They can log on from a cell phone, Palm Pilot, pager or home office system. Red Herring (09.2000)

The Real New Economy Imagine a chess game in which, after every half dozen moves, the arrangement of the pieces on the board stays the same but the capabilities of the pieces randomly change. Knights now move like bishops, bishops like rooks … Technology does that. It rubs out boundaries that separate industries. Suddenly new competitors with new capabilities will come at you from new directions. Lowly truckers in brown vans become geeky logistics experts. … Business 2.0 (8.2001)

The Real New Economy Only a few times in history have interaction costs radically changed one was the railroads, then the telegraph and telephone. Were going through another one right now. Jeff Skilling, Enron

Read It Closely: We dont sell insurance anymore. We sell speed. Peter Lewis, Progressive

Case: CRM

UBIQUITY! Its the cars, not the tires, that squeal: NYT/Circuits/10.25.01): E-ZPass (6M in NE), tests with McDs, gas stations and parking lots next. OnStar (GM/1.5M). Plus: black boxes, GPS (the case of the $450 ticket), CA smog offenders.

CRM has, almost universally, failed to live up to expectations. Butler Group (UK)

No! No! No! FT: The aim [of CRM] is to make customers feel as they did in the pre- electronic age when service was more personal. Rebuttal: (1) Service sucked in the pre-electronic age. (2) NewGen believes in the screen! (So do I.)

One Persons Opinion TP to reporter: Service is MUCH better! Would you go back to bank tellers and phone operators? Value that I place on a smile: 3 on a scale of 10. Value I place on fast & accurate digital response: 11 on a scale of 10!!

M. Rogers: -5% defections = +25% to +85% profit. Lose 15% to 35% p.a. 69% defect as a result of lousy sales or service experience. (Q:But is this the point???? A: Yes. No.)

CGE&Y (Paul Cole): Pleasant Transaction vs. Systemic Opportunity. Better job of what we do today vs. Re- think overall enterprise strategy.

Message CRM: Madness = 600 CRM vendors. ???: Do it all or do something. Past: over-invest in low- value customers. Idea: better experience, not off-load work to customer. Relationship = f(dialogue & knowledge & duration). Key: new attitudes, DESTRUCTION of functional barriers to info & action.

Inet … … allows you to dream dreams you could never have dreamed before!

Theres no use trying, said Alice. One cant believe impossible things. I daresay you havent had much practice, said the Queen. When I was your age, I always did it for half an hour a day. Why, sometimes Ive believed as many as six impossible things before breakfast. Lewis Carroll

Suppose – just suppose – that the Web is a new world were just beginning to inhabit. Were like the earlier European settlers in the United States, living on the edge of the forest. We dont know whats there and we dont know exactly what we need to do to find out: Do we pack mountain climbing gear, desert wear, canoes, or all three? Of course while the settlers may not have known what the geography of the New World was going to be, they at least knew that there was a geography. The Web, on the other hand, has no geography, no landscape. It has no distance. It has nothing natural in it. It has few rules of behavior and fewer lines of authority. Common sense doesnt hold here, and uncommon sense hasnt yet emerged. David Weinberger, Small Pieces Loosely Joined

Q : Is that all there is? A : Quite possibly. Roches New Scientific Method Fast Company. And? X-Functional Teams (NO STOVEPIPES!). Fail fast. The only way to embrace a technological revolution, Roche has discovered, is to unleash an organizational revolution.

RESPONSE

The PSF Solution: The Professional Service Firm Model.

So what will be the Basic Building Block of the New Org?

Every job done in W.C.W. is also done outside …for profit!

Answer: PSF! [Professional Service Firm] Department Head to … Managing Partner, HR [IS, etc.] Inc.

P.S.F.: Summary H.V.A. Projects (100%) Pioneer Clients WOW Work (see below) Hot Talent (see below) Adventurous culture Proprietary Point of View (Methodology) W.W.P.F. (100%)/Outside Clients (25%++)

TP to NAPM: You are the … Rock Stars of the B2B Age!

P.S.F.: Summary H.V.A. Projects (100%) Pioneer Clients WOW Work (see below) Hot Talent (see below) Adventurous culture Proprietary Point of View (Methodology) W.W.P.F. (100%)/Outside Clients (25%++)

BMWs Designworks/USA: >50% from outside work

eHR*/PCC** *All HR on the Web **Productivity Consulting Center Source: E-HR: A Walk through a 21 st Century HR Department, John Sullivan, IHRIM

Model PSF …

(1) Translate ALL departmental activities into discrete W.W.P.F. Products. (2) 100% go on the Web. (3) Non-awesome are outsourced (75%??). (4) Remaining Centers of Excellence are retained & leveraged to the hilt!

The Heart of the Value Added Revolution: PSFs Unbound/ The Solutions Imperative.

Base Case: The Sameness Trap I

Customers will try low cost providers … because the Majors have not given them any clear reason not to. Leading Insurance Industry Analyst

SWA > American + Continental + Delta + Northwest + United + USAirways. Source: Boston Globe (12.22.2001)

Getting Beyond Lip Service! No longer are we only an insurance provider. Today, we also offer our customers the products and services that help them achieve their dreams, whether its financial security, buying a car, paying for home repairs, or even taking a dream vacation.Martin Feinstein, CEO, Farmers Group

Diversity Marketing … Communities of Interest … Bank of America relationship … specialized acquisitions … Farmers Agency Dashboard … HelpPoint … licensed financial planners … etc. … etc. … etc.

TP2002: GE Industrial Systems. Farmers. Message I: Same-same kills. Go way up the VA Chain. (Or else.) Transformation or bust: Full- service/ solutions provider. Great rep … but … NOBODY OWNS THE SPACE. Message II: All dogs must learn … lotsa … new tricks. (Bad news: Everybodys after the same space. Mr. Darwin is on the prowl!)

2002: Same-Same-Same … Farmers = GE = Oracle = MCAA = Biotech & Pharmaceutical Trainers = Omnicom

GE/IS: We dont sell circuit breakers. Farmers: We dont sell insurance. Oracle: We dont sell apps-in-boxes. MCAA: We dont sell a job. B&T Trainers: We dont sell pills. Omnicom: We dont sell ads. (Seagate: We sell the sexiest boxes … and were proud of it.)

Exec, CTFA: The dirty little secret amidst an age of consolidation: Its not all channel management. We need some very cool products!

Bob Lutz: I see us as being in the art business. Art, entertainment and mobile sculpture, which, coincidentally, also happens to provide transportation. Source: NYT 10.19.01

Whaddaboutheproduct? 20 of 26 7 of top 10

Animating Force: The Sameness Trap

Quality Not Enough! Quality as defined by few defects is becoming the price of entry for automotive marketers rather than a competitive advantage. J.D. Power

While everything may be better, it is also increasingly the same. Paul Goldberger on retail, The Sameness of Things, The New York Times

We make over three new product announcements a day. Can you remember them? Our customers cant! Carly Fiorina

The surplus society has a surplus of similar companies, employing similar people, with similar educational backgrounds, working in similar jobs, coming up with similar ideas, producing similar things, with similar prices and similar quality. Kjell Nordstrom and Jonas Ridderstrale, Funky Business

Companies have defined so much best practice that they are now more or less identical. Jesper Kunde, A Unique Moment

10X/10X

The Big Day!

09.11.2000: HP bids $18,000,000,000 for PricewaterhouseCoopers consulting business!

These days, building the best server isnt enough. Thats the price of entry. Ann Livermore, Hewlett-Packard

HP … Sun … GE … IBM … UPS … UTC … General Mills … Springs … Anheuser-Busch … Carpet One … Delphi … Etc. … Etc.

We want to be the air traffic controllers of electrons. Bob Nardelli, GE Power Systems

Customer Satisfaction to Customer Success Were getting better at [Six Sigma] every day. But we really need to think about the customers profitability. Are customers bottom lines really benefiting from what we provide them? Bob Nardelli, GE Power Systems

Keep In Mind: Customer Satisfaction versus Customer Success

Gerstners IBM: Systems Integrator of choice. (BW/12.01). Global Services: $35B. Pledge/99: Business Partner Charter. 72 strategic partners, aim for 200. Drop many in- house programs/products.

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/06.01 (E.g., UPS Logistics manages the logistics of 4.5M Ford vehicles, from 21 mfg. sites to 6,000 NA dealers)

New Springs = Turnkey Flexible sourcing. Collections. Packaging. Merchandising. Promotion. Systems & Site mgt.

Omnicom: 57% (of $6B) from marketing services

Who was the number one employer of architecture school grads in the U.S. last year?

The Pursuit of … Whatever: Accenture to do AT&Ts sales & customer service … for $2.6B/5 years … savings to AT&T of 50%. Accenture to do Avayas corporate learning & training. Source: BW (02.04.2002)

VISIONS OF A BRAND-NAME OFFICE EMPIRE. Sam Zell is not a man plagued by self doubt. Mr. Zell controls public companies that own nearly 700 office buildings in the United States. … Now Mr. Zell says he will transform the real estate market by turning those REITs into national brands. … Mr. Zell believes [clients] will start to view those offices as something more than a commodity chosen chiefly by price and location. –New York Times (12.16.2001)

Problem: Everybody is going after the same space!

Assetless Company John Bryan, CEO, on selling all Sara Lees manufacturing

Dont own nothin if you can help it. If you can, rent your shoes. F.G.

Better Red than Dead?/ Better Dead than Red? We will see more and more outsourcing of discovery processes. Craig Venter

Pfizer: 1,000 projects with academics and biotechs. Novartis: 30% of R&D is via collaborations.

Better Red than Dead?/ Better Dead than Red? If we completely outsourced all of our genetic analysis, wed be held hostage by outside people. Brian Spear, Director of Pharmacogenomics, Abbott Labs

NC2001: Furniture company outsources all mfg. to Asian firm. Asian firm gets financing, buys NC company. Hmmm!!??

The move toward outsourced manufacturing represents an obvious opportunity for contract manufacturers [such as Flextronics: $93M to $15B, 93-01], but its also a potential boon to product innovation. The future of gadget-making is not about making gadgets; its about imagining them. Someone else makes the imaginary real. All that money that used to go to fund infrastructure is going into design and innovation, says Flex CEO Michael Marks. Wired/11.2001

Markets to networks. Hierarchies to networks. Sellers and buyers to suppliers and users. Ownership to access. (Age of Access.) Marginalization of physical property. Weightless economy. Protean generation. Outsourcing of everything. Franchising of everything. (Business format franchising.) (Leasing DNA.) Everything is a service/platform for services delivery. (Give away the goods, charge for the services. VALUE = THE RELATIONSHIP. Share of market to Share of customer.) Every business is show business. Source: Jeremy Rifkin, The Age of Access

Core Logic: (1) 108X5 to 8X1/ eLiza/ 100sf. (2) Dept. to PSF/ WWPF. (3) V.A. via PSFs Unbound/ Solutions/ Customer Success.

The … Solutions 25.

1. Its the (OUR!) organization, stupid! 2. Friction free! 3. No STOVEPIPES! 4. Stovepiping is a F.O.Firing Offense. 5. ALL on the web! (ALL = ALL.) 6. Open access! 6. Project Managers rule! (E.g.: Control the purse strings and evals.) 7. VALUE-ADDED RULES! (Services Rule.) (Experiences Rule.) (Brand Rules.) 8. SOLUTIONS RULE! (We sell SOLUTIONS. Period. We sell PRODUCTIVITY & PROFITABILITY. Period.) 9. Solutions = Our culture. 10. Partner with B.I.C. (Best-In-Class). Period.

11. All functions contribute equallyIS, HR, Finance, Purchasing, Engineering, Logistics, Sales, Etc. 12. Project Management can come from any function. 13. WE ARE ALL IN SALES. PERIOD. 14. We all invest in wiring the customer organization. 15. WE ALL LIVE THE BRAND. (Brand = Solutions. That MAKE MONEY FOR OUR CUSTOMER- PARTNER.) 16. We use the word PARTNER until we all want to barf! 17. We NEVER BLAME other parts of our organization for screwups. 18. WE AIM TO REINVENT THIS INDUSTRY! 19. We hate the word-idea COMMODITY.

20. We believe in High tech, High touch. 21. We are DREAMERS. 22. We deliver. (PROFITS.) (CUSTOMER SUCCESS.) 23. If we play the SOLUTIONS GAME brilliantly, no one can touch us! 24. Our TEAM needs 100% I.C.s (Imaginative Contributors). This is the ULTIMATE All Hands affair! 25. This is a hoot!

TP2002: GE Industrial Systems. Farmers. Message I: Same-same. Way up the VA Chain. (Or else.) Transformation: Full-service/ solutions provider. Great rep … but … NOBODY OWNS THE SPACE. Message II: All dogs must learn … lotsa … new tricks. (Bad news: Everybodys after the same space. Mr. Darwin is on the prowl!)

Getting Beyond Lip Service! No longer are we only an insurance provider. Today, we also offer our customers the products and services that help them achieve their dreams, whether its financial security, buying a car, paying for home repairs, or even taking a dream vacation.Martin Feinstein, CEO, Farmers Group

Diversity Marketing … Communities of Interest … Bank of America relationship … specialized acquisitions … Farmers Agency Dashboard … HelpPoint … licensed financial planners … etc. … etc.

PSF Unbound+: Its the EXPERIENCE.

Experiences are as distinct from services as services are from goods. Joseph Pine & James Gilmore, The Experience Economy: Work Is Theatre & Every Business a Stage

The [Starbucks] Fix Is on … We have identified a third place. And I really believe that sets us apart. The third place is that place thats not work or home. Its the place our customers come for refuge. Nancy Orsolini, District Manager

Experience: Rebel Lifestyle! What we sell is the ability for a 43-year-old accountant to dress in black leather, ride through small towns and have people be afraid of him. Harley exec, quoted in Results-Based Leadership

The Experience Ladder Experiences Services Goods Raw Materials

1940: Cake from flour, sugar (raw materials economy): $1.00 1955: Cake from Cake mix (goods economy): $2.00 1970: Bakery-made cake (service economy): $10.00 1990: Party @ Chuck E. Cheese (experience economy) $100.00

Message: Experience is the Last 80% P.S.: Experience applies to all work!

1940: Cake from flour, sugar (raw materials economy): $1.00 1955: Cake from Cake mix (goods economy): $2.00 1970: Bakery-made cake (service economy): $10.00 1990: Party @ Chuck E. Cheese (experience economy) $100.00

Bob Lutz: I see us as being in the art business. Art, entertainment and mobile sculpture, which, coincidentally, also happens to provide transportation. Source: NYT 10.19.01

The Experience Ladder Experiences Services Goods Raw Materials

Ladder Position Measure Solutions Success (Experiences) Services Satisfaction Goods Six-sigma

The Soul of Experiences: Design Mindfulness.

What is it?

Unconventional [Design] Messages Not about... Lumpy Objects! Not about... $79,000 objects

The I.D. [International Design] Forty* Airstream … Alfred A. Knopf … Apple Computer … Amazon.com … Bloomberg … Caterpillar … CNN … Disney … FedEx … Gillette … IBM … Martha Stewart … New Balance … Nickelodeon … Patagonia … The New York Yankees … 3M … Etc. * List No. 1, 1999

Unconventional [Design] Messages Not about... Lumpy Objects! Not about... $79,000 objects

Design Transforms even the [Biggest] Corporations! TARGET … the champion of Americas new design democracy (Time) Marketer of the Year 2000 (Advertising Age)

Lady Sensor, Mach3, and … $70M on developing the OralB CrossAction toothbrush 23 patents, including 6 for the packaging Source: www.ecompany.com [06.00]

Packaging Power: From Quaker Oats to … Listerine PocketPaks

Packaging, Power of … 1870: animal feed 1890: A delicacy for the epicure, a nutritious dainty for the invalid, a delight to the children Source: Thomas Hine, The Total Package: The Evolution and Secret Meanings of Bottles, Boxes, Cans and Tubes (on Quaker Oats)

Packages are about containing and labeling and informing and celebrating. They are about power and flattery and trying to win peoples trust. They are about beauty and craftsmanship and comfort. They are about color, protection, survival. –Thomas Hine, The Total Package

During the 30 minutes you spend on an average trip to the supermarket, about 30,000 different products vie to win your attention and ultimately to make you believe in their promise. When the door opens, automatically, before you, you enter an arena where your emotions and your appetites are in play, and a walk down the aisle is an exercise in self definition. Are you a good parent, a good provider? … do you care about the environment? Do you appreciate the finer things in life? Are you enjoying what youve accomplished? –Thomas Hine, The Total Package

Bottom Line.

Design is … WHAT & WHY I LOVE. LOVE.

I LOVE my ZYLISS Garlic Peeler!

Design is … WHY I GET MAD. MAD.

Wanted: THE DESIGNER OF MY RADIO SHACK PHONE. Major Reward!

Im just going to come right out and say it: Ericsson lost $2.3B on mobile phone handsets last year because its products are ugly. Peter Martin (FT 04.24.01)

Design is never neutral.

Hypothesis: DESIGN is the principal difference between love and hate!

THE BASE CASE: I am a design fanatic. Though not artistic, I love cool stuff. But it goes [much] further, far beyond the personal. Design has become a professional obsession. I SIMPLY BELIEVE THAT DESIGN PER SE IS THE PRINCIPAL REASON FOR EMOTIONAL ATTACHMENT [or detachment] RELATIVE TO A PRODUCT OR SERVICE OR EXPERIENCE. Design, as I see it, is arguably the #1 DETERMINANT of whether a product-service-experience stands out … or doesnt. Furthermore, its another one of those things that damn few companies put – consistently – on the front burner.

Designs place in the universe.

And Tomorrow … Fifteen years ago companies competed on price. Now its quality. Tomorrow its design. Robert Hayes

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

Design is treated like a religion at BMW. Fortune

The new Beetle fails at most categories. The only thing it doesnt fail in is drop-dead charm. Jerry Hirshberg, Nissan Design International

Object of Desire! Every now and then, a design comes along that radically changes the way we think about a particular object. Case in point: the iMac. Suddenly, a computer is no longer an anonymous box. It is a sculpture, an object of desire, something that you look at. Katherine McCoy & Michael McCoy, Illinois Institute of Technology

We dont have a good language to talk about this kind of thing. In most peoples 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

The good 10 percent of American product design comes out of big-idea companies that dont believe in talking to the customer. They're run by passionate maniacs who make everybodys life miserable until they get what they want. Bran Ferren, Applied Minds/Wired 1-2001

Check Out the Language: Tomorrow its design … Design is the only thing … Design is … religion... Drop-dead charm … Object of desire … Fundamental soul … Passionate maniacs …

Philippe Starck

Today the problem is not how to produce more to sell more. The fundamental question is that of the products right to exist. And it is the designers right and duty to question the legitimacy of the product. Philippe Starck

[At Thompson] I outlawed the word consumer in all company meetings, and insisted it be replaced by the words my friend, my wife, my daughter, my mother, or myself. It doesnt sound the same at all, if you say: It doesnt matter, its shit, but the consumers will make do with it, or if you start over again and say, Its shit, but it doesnt matter, my daughter will make do with it. All of a sudden, you cant get away with it anymore. There is an enormous task to be done with this kind of symbolic repositioning. Philippe Starck

Today, 80 per cent of objects are unnecessarily macho. Yet it is plain: The intelligence of a truly modern society must be feminine. … Apart from a machine pistol, I cant think of many objects which actually need to be extravagantly masculine. Philippe Starck

Message (?????): Men cannot design for womens needs.

Architect to TP: The only house with a second- floor laundry was designed by a woman.

Message: Design is the wellspring of branding. Great design takes guts and is soul deep.

T.T.D./Design Awareness! STEP No. 1: NOTEBOOK! [Start recording the awesome and the awful.]

Compare 10 order forms or data fields at a Web site. Save great and awful junk mail. Go on a <$10 shopping spree. Pay attention to signage. (And instruction manuals.) Start a notebook. NOW.

Design-Minded Company: Credo Design matters! Everywhere! The Brand Promise rules! Everywhere! All can answer: WHO ARE WE? HOW ARE WE DISTINCT? Words such as beauty & grace & emotion & connection & Wow & adventure are okay twixt 9 and 5. Non-Wow doesnt cut it. Anywhere! We aim to attract Best-In-Planet TALENT; non-traditional hiring, with an emphasis on the arts, is part of this. Diversity-R-Us!

Design-Minded Company: Operating Philosophy All work is the product of Hot Teams of peers. Hierarchy is minimal, and usually a distraction. We understand that disrespect is the ultimate in respect in crazy times. The Work Matters! Wow … or bust! All work reflects design-mindfulness & the brand promise. Promotion comes immediately if the work is Wow. NO BULLSHIT. We keep our word to our teammates and other partners. Integrity = No.1 outcropping of design-mindfulness. We are a business. Results matter!

Design+ = Beautiful Systems.

Fred S.s mediocre thesis. Herb K.s napkin.

Great design = One-page business plan (Jim Horan)

K.I.S.S.: Gordon Bell (VAX daddy): 500/50. Chas. Wang (CA): Behind schedule? Cut least productive 25%.

Scaled De-Compression, Rule Of … 5 days on the ground = 5 weeks (MONTHS?) in absentia

Most companies would do more business on the Internet if they fired their entire marketing department and replaced it with people who could produce interactive content that actually made it easier for users to buy. Jakob Nielsen, Nielsen Norman Group

SWA Simple!!!!!!!!!!!! (customers call because the process is so easy they cant believe theyre done) 30% of revenues directly from site (vs. 6% for others) Source: Business Week (09.00)

Read It Closely: We dont sell insurance anymore. We sell speed. Peter Lewis, Progressive

K.I.S.S./Jack 1@T Welch: (1) Neutron Jack. (Banish bureaucracy.) (2) 1, 2 or out Jack. (Lead or leave.) (3) Workout Jack. (Empowerment, GE style.) (4) 6-Sigma Jack. (5) Internet Jack. (Throughout) TALENT JACK!

Systems: Must have. Must hate. / Must design. Must un- design.

Ninety percent of what we call management consists of making it difficult for people to get things done. – P.D.

Mgt. Team includes … EVP (S.O.U.B.)

Executive Vice President, Stomping Out Unnecessary Bullshit

Revised wisdom: Forget best practice (stultifying). Concentrate on: Driving out worst practice. Source: Equinox Manifesto (12.01)

First Steps: Beauty Contest! 1.Select one form/document: invoice, air bill, sick leave policy, customer returns-claim form. 2. Rate the selected doc on a scale of 1 to 10 [1 = Bureaucratica Obscuranta/ Sucks; 10 = Work of Art] on four dimensions: Beauty. Grace. Clarity. Simplicity. 3. Re-invent! 4. Repeat, with a new selection, every 15 working days.

Systems Design Matters! Palm Beach Countys U.C.B. * [*Utterly Confusing Ballot]

It all adds up to … THE BRAND.

WHO ARE YOU [these days] ? TP to Client

Most companies tend to equate branding with the companys marketing. Design a new marketing campaign and, voilà, youre on course. They are wrong. The task is much bigger. It is about fulfilling our potential … not about a new logo, no matter how clever. WHAT IS MY MISSION IN LIFE? WHAT DO I WANT TO CONVEY TO PEOPLE? HOW DO I MAKE SURE THAT WHAT I HAVE TO OFFER THE WORLD IS ACTUALLY UNIQUE? The brand has to give of itself, the company has to give of itself, the management has to give of itself. To put it bluntly, it is a matter of whether – or not – you want to be … UNIQUE … NOW. Jesper Kunde, A Unique Moment Jesper Kunde

We are in the twilight of a society based on data. As information and intelligence become the domain of computers, society will place more value on the one human ability that cannot be automated: emotion. Imagination, myth, ritual - the language of emotion - will affect everything from our purchasing decisions to how we work with others. Companies will thrive on the basis of their stories and myths. Companies will need to understand that their products are less important than their stories. Rolf Jensen, Copenhagen Institute for Future Studies

Brand Promise Exercise: (1) Who Are WE? (poem/novella/song, then 25 words.) (2) List three ways in which we are UNIQUE … to our Clients. (3) Who are THEY (competitors) ? (ID, 25 words.) (4) List 3 distinct us/them differences. (5) Try results on your teammates. (6) Try em on a friendly Client. (7) Try em on a skeptical Client!

1 st Law Mktg Physics: OVERT BENEFIT (Focus: 1 or 2 > 3 or 4/One Great Thing. Source #1: Personal Passion) 2 ND Law: REAL REASON TO BELIEVE (Stand & Deliver!) 3 RD Law: DRAMATIC DIFFERENCE (Execs Dont Get It: See the next slide.) Source: Jump Start Your Business Brain, Doug Hall

2 Questions: How likely are you to purchase this new product or service? (95% to 100% weighting by execs) How unique is this new product or service? (0% to 5%*) *No exceptions in 20 years – Doug Hall, Jump Start Your Business Brain

Message: Branding is B.S. long- term if the product is not supercalifragilisticexpealidocious (e.g., see sections on Design & Experience above)

The Heart of Branding …

WHO ARE WE?

WHATS OUR STORY?

DO THE HOUSEKEEPERS & CLERKS BUY IT? [ARE YOU V-E-R-Y SURE?]

EXACTLY HOW ARE WE DRAMATICALLY DIFFERENT?

WHY DOES IT MATTER TO THE CLIENT?

EXACTLY HOW DO I PASSIONATELY CONVEY THAT DRAMATIC DIFFERENCE TO THE CLIENT ?

THE INDIVIDUAL

Re-inventing the Individual: BRAND YOU. (Or Else.)

2010 Demographics: By 2010, full-time workers will be in the minority Source: MIT study (28August2000)

New World of Work < 1 in 10 F500 #1: Manpower Inc. Freelancers/I.C.: 16M-25M Temps: 3M (incl. CEOs & lawyers) Microbusinesses: 12M-27M Total: 31M-55M Source: Daniel Pink, Free Agent NationDaniel PinkFree Agent Nation

The fundamental unit of the new economy is not the corporation, but the individual. Tasks arent assigned and controlled through a stable chain of command but are carried out autonomously by independent contractors - e-lancers - who join together in fluid and temporary networks to sell goods and services. When the job is done, the network dissolves and its members become independent again, circulating through the economy, seeking the next assignment. Thomas Malone and Robert Laubacher

If there is nothing very special about your work, no matter how hard you apply yourself, you wont get noticed, and that increasingly means you wont get paid much either. Michael Goldhaber, Wired

Minimum New Work SurvivalSkillsKit2002 Mastery Rolodex Obsession (vert. to horiz. loyalty) Entrepreneurial Instinct CEO/Leader/Businessperson/Closer Mistress of Improv Sense of Humor Intense Appetite for Technology Groveling Before the Young Embracing Marketing Passion for Renewal

Sams Secret #1!

Minimum New Work SurvivalSkillsKit2001 Mastery Rolodex Obsession (vert. to horiz. loyalty) Entrepreneurial Instinct CEO/Leader/Businessperson/Closer Mistress of Improv Sense of Humor Intense Appetite for Technology Groveling Before the Young Embracing Marketing Passion for Renewal

You must realize that how you invest your human capital matters as much as how you invest your financial capital. Its rate of return determines your future options. Take a job for what it teaches you, not for what it pays. Instead of a potential employer asking, Where do you see yourself in 5 years? youll ask, If I invest my mental assets with you for 5 years, how much will they appreciate? How much will my portfolio of career options grow? Stan Davis & Christopher Meyer, futureWEALTH

My ancestors were printers in Amsterdam from 1510 or so until 1750, and during that entire time they didnt have to learn anything new. Peter Drucker, Business 2.0 (08.22.00)

Knowledge becomes obsolete incredibly fast. The continuing professional education of adults is the No. 1 industry in the next 30 years … mostly on line. Peter Drucker, Business 2.0 (22August2000)

E-LEARNING: 2M students in U.S. 4,000 colleges & universities offer. Target: Developing world. E.g.: U. of Melbourne & McGill, part of U21 (with Thompson Learning), expect 100K students by 2010mostly Asians. Armys $500M contract with PWC (eArmyU)includes degrees @ 24 colleges. Mixed models: Fuqua9 to 11 weeks in residence over 2 years. Dentist gets law degree25 to 30 hours per week. IBM trained 200K online in 2000saved $350M. Tricks: Small classes, required student involvement at U. of Phoenix Online (76% growth in Y2K.). Source: Business Week (12.03.2001)

3 Weeks in May Training & Prep: 187 Work: 41 (Other: 17)

1% vs. 367%

Divas do it. Violinists do it. Sprinters do it. Golfers do it. Pilots do it. Soldiers do it. Surgeons do it. Cops do it. Astronauts do it. Why dont businesspeople do it [very much]?

Conclusion: We are not serious!

Invent. Reinvent. Repeat. Source: HP banner ad

The time seems appropriate to rethink the notions of self and identity in this rapidly changing age … Tara Lemmey, Project LENS, past president Electronic Frontier Foundation

In Store: International Equality, Intranational Inequality The new organization of society implied by the triumph of individual autonomy and the true equalization of opportunity based upon merit will lead to very great rewards for merit and great individual autonomy. This will leave individuals far more responsible for themselves than they have been accustomed to being during the industrial period. It will also reduce the unearned advantage in living standards that has been enjoyed by residents of advanced industrial societies throughout the 20 th century. James Davidson & William Rees-Mogg, The Sovereign Individual

Great Great Granddad: Pushes the plow. Great Granddad: Horse now walks ahead of the plow. Granddad: Farm Hand to Factory Factotum. Dad: Factory Factotum to White Collar Cubicle Slave. And You: V.A. Player (Brand You) … or else!

America[ns] The … Beautiful Re-inventors Ben F. Ralph W.E. Dale C. N.V.P. Werner E./EST Tony R. Stephen

Brand You, Big Time! I AM AN ARMY OF ONE

Message: Distinct … or Extinct.

Brand You+: A New Age of Self- determination. (+Trends I: Health Care Center Stage.)

Parents, doctors, stockbrokers, even military leaders are starting to lose the authority they once had. There are all these roles premised on access to privileged information. … What we are witnessing is a collapse of that advantage, prestige and authority. Michael Lewis, next

Anne Busquet/ American Express Not: Age of the Internet Is: Age of Customer Control

Amen!The Age of the Never Satisfied Customer Regis McKenna

Reuters (12.11.01): Teens and young adults are flocking to the Web for health-related information as much as they are downloading music and playing games online and more often than shopping online, according to a national survey from the Kaiser Family Foundation.

One in Four Internet Users Seek Religious InformationReuters (12.24.2001) (God trumps money, sex.)

Impact #1: Healthcare

HealthCare2001 Consumerism X Demographics X IS/Internet X Info Consolidators X Genetics & Devices = YIKES!

1. Consumerism (Patient- centric Healthcare)

A seismic shift is underway in healthcare. The Internet is delivering vast knowledge and new choices to consumersraising their expectations and, in many cases, handing them the controls. [Healthcare] consumers are driving radical, fundamental change. Deloitte Research, Winning the Loyalty of the eHealth Consumer

Reuters (12.11.01): Teens and young adults are flocking to the Web for health-related information as much as they are downloading music and playing games online and more often than shopping online, according to a national survey from the Kaiser Family Foundation.

Consumer Imperatives Choice Control (Self-care, Self-management) Shared Medical Decision-making Customer Service Information Branding Source: Institute for the Future

Consumerism: HMO backlash (e.g., plans with more choice). Alternative Medicine, Wellness & Prevention. Info availability (disease, health, docs, support groups, outcomes). Self-care (chronic disease). High expectations (genetics, etc.). Boomers (see below). …

Savior for the Sick vs. Partner for Good Health Source: NPR/VPR 08.15.00

He shook me up. He put his hand on my shoulder, and simply said, Old friend, you have got to take charge of your own medical care. Hamilton Jordan, No Such Thing as a Bad Day (on a conversation with a doctor pal, following Jordans cancer diagnosis)

2. Demographics : The BOOMERS Reach 55!

Boomer World From jogging to plastic surgery, from vegetarian diets to Viagra, they are fighting to preserve their youth and defy the effects of gravity. M.W.C. Howgill, Healthcare Consumerism, the Information Revolution and Branding

Message Boomer: (1) There are l-o-t-s of us. (2) We have the $$$$$$. (3) Were/ Im in charge! (4) Well take no guff from anyone. (5) We know the emperor has no clothes.

3. The IS/Web REVOLUTION

Were in the Internet age, and the average patient cant email their doctor. Donald Berwick, Harvard Med School

In an era when terrorists use satellite phones and encrypted email, US gatekeepers stand armed against them with pencils and paperwork, and archaic computer systems that dont talk to each other. Boston Globe (09.30.2001)

Once devised in Riyadh, the tasking order took hours to get to the Navys six aircraft carriersbecause the Navy had failed years earlier to procure the proper communications gear that would have connected the Navy with its Air Force counterparts. … To compensate for the lack of communications capability, the Navy was forced to fly a daily cargo mission from the Persian Gulf and Red Sea to Riyadh in order to pick up a computer printout of the air mission tasking order, then fly back to the carriers, run photocopy machines at full tilt, and distribute the documents to the air wing squadrons that were planning the next strike. –Bill Owens, Lifting the Fog of War

By combining powerful computer technology and other modern information-based systems we could make a revitalized, leaner military force that is designed to outsee, outmaneuver and outfight any foe. --Bill Owens, Lifting the Fog of War

Without being disrespectful, I consider the U.S. healthcare delivery system the largest cottage industry in the world. There are virtually no performance measurements and no standards. Trying to measure performance … is the next revolution in healthcare. Richard Huber, former CEO, Aetna

As unsettling as the prevalence of inappropriate care is the enormous amount of what can only be called ignorant care. A surprising 85% of everyday medical treatments have never been scientifically validated. … For instance, when family practitioners in Washington were queried about treating a simple urinary tract infection, 82 physicians came up with an extraordinary 137 strategies. Demanding Medical Excellence: Doctors and Accountability in the Information Age, Michael Millenson

In health care, geography is destiny. Dartmouth Medical School 1996 report, from Demanding Medical Excellence: Doctors and Accountability in the Information Age, Michael Millenson

Geography Is Destiny E.g.: Ft. Myers 4X Manhattanback surgery. Newark 2X New Haven prostatectomy. Rapid City SD 34X Elyria OHbreast-conserving surgery. VT, ME, IA: 3X differences in hysterectomy by age 70; 8X tonsillectomy; 4X prostatectomy ( 10X Baton Rouge vs. Binghampton). Breast cancer screening: 4X NE, FL, MI vs. SE, SW. (Source: various)

Geography Is Destiny Often all one must do to acquire a disease is to enter a country where the disease is recognizedleaving the country will either cure the malady or turn it into something else. … Blood pressure considered treatably high in the United States might be considered normal in England; and the low blood pressure treated with 85 drugs as well as hydrotherapy and spa treatments in Germany would entitle its sufferer to lower life insurance rates in the United States. – Lynn Payer, Medicine & Culture

Practice variation is not caused by bad or ignorant doctors. Rather, it is a natural consequence of a system that systematically tracks neither its processes nor its outcomes, preferring to presume that good facilities, good intentions and good training lead automatically to good results. Providers remain more comfortable with the habits of a guild, where each craftsman trusts his fellows, than with the demands of the information age. Michael Millenson, Demanding Medical Excellence

CDC 1998: 90,000 killed and 2,000,000 injured from nosocomial [hospital-caused] drug errors & infections

Quality of care is the problem, not managed care. Institute of Medicine (from Michael Millenson, Demanding Medical Excellence)

RAND (1998): 50%, appropriate preventive care. 60%, recommended treatment, per medical studies, for chronic conditions. 20%, chronic care treatment that is wrong. 30% acute care treatment that is wrong.

In a disturbing 1991 study, 110 nurses of varying experience levels took a written test of their ability to calculate medication doses. Eight out of 10 made calculation mistakes at least 10% of the time, while four out of 10 made mistakes 30 % of the time. Demanding Medical Excellence: Doctors and Accountability in the Information Age, Michael Millenson

1,000,000 serious medication errors per year … illegible handwriting, misplaced decimal points, and missed drug interactions and allergies. Source: Wall Street Journal/ Institute of Medicine

Answer: (1) Physician order-entry system, (2) stick to treatment guidelines for high-risk patients, (3) adequate ICU staffing.

The perils/costs of folk wisdom: Pills vs. IV/$100. Per use.

Patient by patient, problem by problemdrug reactions, hospital caused infectionsSalt Lake Citys LDS Hospital has attacked treatment- caused injuries and deaths. One of the secrets of LDSs success is a custom- built clinical computer system that may serve as a national model for how to save patient lives. Demanding Medical Excellence: Doctors and Accountability in the Information Age, Michael Millenson

The VHA gets it! E.g.: Laptop at bedside calls up patient e-records from one of 1,300 hospitals. Bar- coded wristband confirms meds. National Center for Patient Safety in Ann Arbor. Docs and researchers discuss optimal treatment regimensresearch center in Durham NC. Doc measures & guidelines; e.g., pneumonia vaccinations from 50% to 84%. Blame- free system, modeled after airlines. Whats needed in the U.S. is nothing short of a medical revolution and the VHA has gone further than most any other organization to revamp its culture and systems. Rand/Source:WSJ 12.10.2001

When a plane crashes, they ask, What happened? In medicine they ask: Whose fault was it? James Bagian, M.D. & former astronaut, now working with the VHA.

Winning By Acknowledging Failures Wernher Von Braun, the Redstone missile engineer who confessed & the bottle of champagne. Award to the sailor on the Carl Vinsonfor reporting the lost tool. Amy Edmondson & the successful nursing units with the highest reported adverse drug events. Source: Karl Weick & Kathleen Sutcliffe, Managing the Unexpected

4. Information Consolidators: The Network Maestros

America has twice as many hospitals and physicians as it needs. Med Inc., Sandy Lutz, Woodrin Grossman & John Bigalke

The future of hospitals is murky. A combination of technological advances, managed care, and changes in Medicare reimbursement policy means that the underlying demand for inpatient services will continue to fall. Institute for the Future

Virtual health care webs force providers to focus on their areas of excellence and to invest in areas where they can generate a sustainable competitive advantage. Healthcare.com: Rx for Reform, David Friend, Watson Wyatt Worldwide

WebMD (or heirs & assigns)

5. Genetics & Devices

Recognizing that a single misspelled gene means the difference between being poisoned and being cured was the first victory for the new science of pharmacogenetics. Newsweek (06.25.01)

Genetic data: 2X every 6 months. Source: FT, 11.27.2001

Pharmacogenomics could fundamentally change the nature of drug discovery and marketing, rendering obsolete the pharmaceutical industrys practice of spending vast amounts of time and money to craft a single medicine with mass-market appeal. The Industry Standard (05.28.01)

E.g., Genentechs Herceptin, useful in 25% of advanced breast cancer cases. Would probably have been uneconomic if subjected to 9X patients in phase III clinical trials. Source: FT (11.27.01)

Pharmacogenomics: End of Blockbusters by End-of-Decade (Reuters/5-22) Barrie James, Pharma Strategy Consulting: Were moving from a blunderbuss approach to laser- guided munitions, and it marks a sea change for the industry. The implications for existing business models are devastating. Allen Roses, SVP Genetic Research, GlaxoSmithKline: minibuster. Rob Arnold, Euro head of life sciences, PWC : Once you start dealing with minority treatments, small biotechs who are more nimble and dont need $500-million-a-year drugs to make money could be at a real advantage.

BIG DRUG MAKERS TRY TO POSTPONE CUSTOM REGIMENS. Most drugs dont work well for about half the patients for whom they are prescribed, and experts believe genetic differences are part of the reason. The technology for genetic testing is now in use. But the technique threatens to be so disruptive to the business of big drug companies – it could limit the market for some of their blockbuster products – that many of them are resisting its widespread use. The Wall Street Journal (06.18.2001)

Forbes100 from 1917 to 1987: 39 members of the Class of 17 were alive in 87; 18 are in 87 F100; the 18 F100 survivors underperformed the market by 20%; just 2 (2%), GE & Kodak, outperformed the market from 1917 to 1987. Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market

Biotechs: Amgen, Genentech, Biogen, Genzyme, Celltech, ImClone Systems. Bioinformatics: Accelrys, Cognia, Double Twist, IBM Lifesciences, NetGenics, SAS Institute.

Imagine the day that your surgeon performs your heart bypass sitting at a computer thousands of miles from the operating table. That day may come sooner than you think. Newsweek (06.25.01)

There is no question in my mind that the future of heart surgery is in robotics. Dr. Robert Michler, OSU Med Center, upon the FDAs approval of robotic partial- bypass surgery

Golden Age of Patient-centric, Genetics- driven Healthcare Looms! Current status: $1.3T. 30M-70M uninsured. 90K killed and 2M injured p.a. in hospitals. 85% treatments unproven. Cure depends on locale in which treated. 50% prescriptions do not work. 2X docs. 2X hospitals. IS primitive. Accountability & measurement nil. And everybodys mad and feels powerless: docs, patients, nurses, insurers, employers, hospitals administrators and staff.

Message: (1) An unparalleled time for imagination and bold action. (2) A time of unprecedented opportunities. (3) A time of unprecedented risk.

THE WORK

Redefining the Work Itself I: The WOW Project.

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

Language matters! Wow! BHAG! Takes your breath away!

Intimidate their [users] imaginations … Wheres the revolution? –J Allard, on the Xbox

Lets make a dent in the universe. Steve Jobs

Your Current Project? 1. Another days work/Pays the rent. 4. Of value. 7. Pretty Damn Cool/Definitely subversive. 10. WE AIM TO CHANGE THE WORLD. (Insane!/Insanely Great!/WOW!)

Learn not to be careful. Photographer Diane Arbus, to her students

Age 60. Yes: Show the job to your Grandson Billy: This was risky, but nobody had ever done a cantilever like this before. No: Billy, we brought this in 17.3% under budget.

Re-defining the Work Itself II: WOW Projects for the Powerless.

Topic: Boss-free Implementation of STM /Stuff That MATTERS!

Worlds Biggest Waste … Selling Up

THE IDEA: Model F4 F ind a F ellow F reak F araway

Heart of the Matter F2F!/K2K!/ 1@T/R.F!A.* *Freak to Freak/Kook to Kook/ One at a Time/ Ready.Fire!Aim.

THE NUGGET Do Something. Do Anything. Get Going. Now.

Opportunity ALWAYS Knocks VFCJ* Strategy *Volunteer For Crappy Jobs

Is It … The Oh-Hell-I-Wish-It-Were- Over Memorial Day picnic or The First Annual S eriously K ewl C elebration of Our Incredible Staff

Is It … Wrestle the damn Safety Manual into line with the ridiculous new OSHA Regs? Or … A stealth opportunity to address the War for Talent via … a thoroughgoing review of how safety and environmental issues contribute to making this a Great Place to Work?

Reframers Rules: Rule 1: Never accept an assignment as given! (Please.) Rule 2: Youre never so powerful as when you are powerless! Rule 3: Every small project contains the entire enterprise DNA!

THE TOOL Prototyping Mania!

Think about It!? Innovation = Reaction to the Prototype Michael Schrage

He who has the quickest O.O.D.A. Loops* wins! *Observe. Orient. Decide. Act. / Col. John Boyd

THE Process Building Buzz!

Boss-free Selling of a WOW! Idea Get a Zany [WOW!] Idea/ Shop it with a coupla good pals. Surface [using your network] a list of [operational] folks who might be interested in playing. Call, visit and choose a coupla prospects. Engage the prospects [they must own it]. Concoct a rough plan and a prototype schedule. Move forward [Ready. Fire! Aim.]. Keep on recruitin. Get the Test Customer to recruit some buddies for Round #2 tests. [Meanwhile Customer #1 expands program.]

Get going with Round #2 prototypes Start conscious buzz building [Let the word of successful tests trickle out] Have the line dudes put on a demo for, say, a coupla cool regional bosses Etc. Etc. Have the growing Network of Converts initiate a Major Program Proposal Etc. Etc.

BOTTOM LINE The Enemy!

Joe J. Jones 1942 – 2002 HE WOULDA DONE SOME REALLY COOL STUFF BUT … HIS BOSS WOULDNT LET HIM!

The greatest danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it. Michelangelo

Characteristics of the Also rans* Minimize risk Respect the chain of command Support the boss Make budget *Fortune, article on Most Admired Global Corporations

Message to scientists: It AINT about the science. Its NEVER about the science. Its ALWAYS about the PASSION for the IDEA.

In a long and honorable career, a Ph.D. scientist in a pharmaceutical house is not likely – statistically – to experience a success. Pharmaceutical Exec

Statistically speaking, Churchill shouldnt have been able to fend off Hitler. Statistically speaking, de Gaulle shouldnt have been able to revive the French. Statistically speaking, Jefferson & Adams & Hamilton shouldnt have been able to create America.

I wonder …

Will one of you be awoken some December morning in Stockholm by candle-carrying kids?

If you are not prepared to be fired over your beliefs … you are working on the wrong project - TP

Charles Handy on the alchemists: Passion was what drove these people, passion for their product or their cause. If you care enough, you will find out what you need to know. Or you will experiment and not worry if the experiment goes wrong. Passion as the secret to learning is an odd secret to propose, but I believe that it works at all levels and at all ages. Sadly, passion is not a word often heard in the elephant organizations, nor in schools, where it can seem disruptive.

Goal: Drive out fear. (Deming et al.) Solution: Passion (alone?) drives out fear. Source: Equinox Manifesto (12.01)

John Jumper and Predator, the armed unmanned drone.

Walsh: Heightshrimp. Arm okay. Quicknessokay. Speed slow. ZealPLANET CLASS. People cant measure your heart. They look at my size, my arm strength and knock me for thatJeff Garcia. Source: USA Today, 11.23.2001

The Sales 25.

The Sales25 : Great Salespeople … 1. Know the product. (Find cool mentors, and use them.) 2. Know the company. 3. Know the customer. (Including the customers consultants.) (And especially the corporate culture.) 4. Love internal politics at home and abroad. 5. Religiously respect competitors. (No badmouthing, no matter how provoked.) 6. Wire the customers org. (Relationships at all levels & functions.) 7. Wire the home teams org. and vendors orgs. (INVEST Big Time time in relationships at all levels & functions.) (Take junior people in all functions to client meetings.)

Its not me! X has it in for me! Lesson: Somebody always has it in for us. Success = Smile … and deal with it.

The Sales25 : Great Salespeople … 1. Know the product. (Find cool mentors, and use them.) 2. Know the company. 3. Know the customer. (Including the customers consultants.) (And especially the corporate culture.) 4. Love internal politics at home and abroad. 5. Religiously respect competitors. (No badmouthing, no matter how provoked.) 6. Wire the customers org. (Relationships at all levels & functions.) 7. Wire the home teams org. and vendors orgs. (INVEST Big Time time in relationships at all levels & functions.) (Take junior people in all functions to client meetings.)

Great Salespeople … 8. Never overpromise. (Even if it costs you your job.) 9. Sell only by solving problems-creating profitable opportunities. (Our product solves these problems, creates these unimagined INCREDIBLE opportunities, and will make you a ton of moneyheres exactly how.) (IS THIS A PRODUCT SALE OR A WOW-ORIGINAL SOLUTION YOULL BE DINING OFF 5 YEARS FROM NOW? THAT WILL BE WRITTEN UP IN THE TRADE PRESS?) 10. Will involve anybodyincluding mortal enemiesif it enhances the scope of the problem we can solve and increases the scope of the opportunity we can encompass. 11. Know the Brand Story cold; live the Brand Story. (If not, leave.)

Great Salespeople … 12. Think Turnkey. (Its always your problem!) 13. Act as orchestra conductor: You are responsible for making the whole-damn-network respond. (PERIOD.) 14. Help the customer get to know the vendors organization & build up their Rolodex. 15. Walk away from bad business. (Even if it gets you fired.) 16. Understand the idea of a good loss. (A bold effort thats sometimes better than a lousy win.) 17. Think those who regularly say Its all a price issue suffer from rampant immaturity & shrunken imagination. 18. Will not give away the store to get a foot in the door. 19. Are wary & respectful of upstartsthe real enemy. 20. Seek several cool customerswholl drag you into Tomorrowland.

Great Salespeople … 21. Use the word partnership obsessively, even though it is way overused. (Partnership includes folks at all levels throughout the supply chain.) 22. Send thank you notes by the truckload. (NOT E- NOTES.) (Most are for little things.) (50% of those notes are sent to those in our company!) Remember birthdays. Use the word we. 23. When you look across the table at the customer, think religiously to yourself: HOW CAN I MAKE THIS DUDE RICH & FAMOUS & GET HIM-HER PROMOTED? 24. Great salespeople can affirmatively respond to the query in an HP banner ad: HAVE YOU CHANGED CIVILIZATION TODAY? 25. Keep your bloody PowerPoint slides simple!

Re-defining the Work Itself III: Starting a Wow Projects Epidemic.

Premise: Ordering Systemic Change is a Stupid Waste of Time!

Demos! Heroes! Stories!

L.B.I.W.D. (Leading By Inducing Weird Demos)

Leaders aiming to change their world … troll for & identify palpable heroes, who executed palpable projects then they point to these people and say to the masses, See, here it is, done by one of your own. (And then they deep-dip a few of those heroes to demo their seriousness.)

Trolling for radicals. ER Doc Ken Kizer (former VA Undersecretary): Spots patient wrist band during 1998 visit to Topeka. Finds RN Sue Kinnick. (Shed gotten the idea from Avis.) Kizer orders systemic experiment. 170 hospitals by 09.2000. Topeka: 70% reduction in meds errors.

Demo = Story A key – perhaps the key – to leadership is the effective communication of a story. Howard Gardner, Leading Minds: An Anatomy of Leadership

MB S A!* *Managing By Story-ing Around/David Armstrong

Boss Mantra #1: So … tell me a story.

Boss Advice I: The Poster Kids Strategy Chat up the organization. Develop a tentative list of Pioneers. Hang with those Pioneers, discover the stuff Ive long wanted to do/Encourage them to Do it! Begin to showcase their developing results [with your public stamp of approval]. Dip deep[ish] and early - promote a Pioneer into the [New] Establishment. Incorporate the Pioneers work into your Vision Chatter/Welcome ALL aboard!

Boss Advice II: The Flypaper Strategy Event Marketing: Idea Fair/Internal Tradeshow/Bragfest. Or: Seminar Series, with strange outsiders/insiders (not the usual suspects); intense Web-based follow-up and community creation (Neighborhoods of Common Interest). Play Fund, around a topic of importance. Small-ish grants. Easy application process. Short-ish timeframes. (Gerstner @ American Express re AI.) Scholarships (not the usual suspects). Sabbatical funds (contest?). Placement on customer or supplier project teams (not the usual suspects).

Each VP a V.C.: Portfolio of high-risk investments … in people/ideas … from all across the company.

Silicon Valley Success [Failure?] Secrets Pursuit of risk: 4 of 20 in V.C. portfolio go bust; 6 lose money; 6 do okay; 3 do well; 1 hits the jackpot Source: The Economist

Freaks need mentors/ guardians!

Summary Dont try to change the culture! Do create flypaper which attracts Mavericks & Pirates! Let the new culture (which is already lurking around you) find you! Publicize, at the appropriate moment, the New Hall of Fame; help the New Culture Adherents create & nurture Community!

G.M. … V.C. … W.P. … M.B.S.A.

THE TALENT

Brand = Talent.* *Duh.

When land was the scarce resource, nations battled over it. The same is happening now for talented people. Stan Davis & Christopher Meyer, futureWEALTH

Yikes: What worries me is that I cant see why any ambitious young person would want to join my company, or stay here for long if they did join. My most important job is to change that as fast as I can. CEO, giant multinational, to Charles Handy

The Talent Ten

1. Obsession P.O.T.* = All Consuming *Pursuit of Talent

The leaders of Great Groups love talent and know where to find it. They revel in the talent of others. Warren Bennis & Patricia Ward Biederman, Organizing Genius

Model 25/8/53 : Sports Franchise GM

2. Greatness Only The Best!

From 1, 2 or youre out [JW] to …Best Talent in each industry segment to build best proprietary intangibles [EM] Source: Ed Michaels, War for Talent (05.17.00)

3. Performance Up or out!

We believe companies can increase their market cap 50 percent in 3 years. Steve Macadam at Georgia-Pacific changed 20 of his 40 box plant managers to put more talented, higher paid managers in charge. He increased profitability from $25 million to $80 million in 2 years. Ed Michaels, War for Talent (05.17.00)

Message: Some people are better than other people. Some people are a helluva lot better than other people.

4. Pay Fork Over!

Top performing companies are two to four times more likely than the rest to pay what it takes to prevent losing top performers. Ed Michaels, War for Talent (05.17.00)

What gets measured gets done. What gets paid for gets done more. What gets paid a lot for gets done a lot more.

5. Youth Grovel Before the Young!

Why focus on these late teens and twenty- somethings? Because they are the first young who are both in a position to change the world, and are actually doing so. … For the first time in history, children are more comfortable, knowledgeable and literate than their parents about an innovation central to society. … The Internet has triggered the first industrial revolution in history to be led by the young. The Economist [12/2000]

Talk to kids. Watch how they use instant messaging, and you can learn it all. Kids hold the clue to the future of technology. John Patrick, ebusiness guru, IBM

6. Diversity Mess Rules!

Diversity defines the health and wealth of nations in a new century. Mighty is the mongrel. … The hybrid is hip. The impure, the mélange, the adulterated, the blemished, the rough, the black-and-blue, the mix-and-match – these people are inheriting the earth. Mixing is the new norm. Mixing trumps isolation. It spawns creativity, nourishes the human spirit, spurs economic growth and empowers nations. G. Pascal Zachary, The Global Me: New Cosmopolitans and the Competitive Edge

7. Women Born to Lead!

AS LEADERS, WOMEN RULE: New Studies find that female managers outshine their male counterparts in almost every measure Title, Special Report, Business Week, 11.20.00

The New Economy … Shout goodbye to command and control! Shout goodbye to hierarchy! Shout goodbye to knowing ones place!

Womens Strengths Match New Economy Imperatives: Link [rather than rank] workers; favor interactive-collaborative leadership style [empowerment beats top-down decision making]; sustain fruitful collaborations; comfortable with sharing information; see redistribution of power as victory, not surrender; favor multi-dimensional feedback; value technical & interpersonal skills, individual & group contributions equally; readily accept ambiguity; honor intuition as well as pure rationality; inherently flexible; appreciate cultural diversity. Source: Judy B. Rosener, Americas Competitive Secret

TAKE THIS QUICK QUIZ: Who manages more things at once? Who puts more effort into their appearance? Who usually takes care of the details? Who finds it easier to meet new people? Who asks more questions in a conversation? Who is a better listener? Who has more interest in communication skills? Who is more inclined to get involved? Who encourages harmony and agreement? Who has better intuition? Who works with a longer to do list? Who enjoys a recap to the days events? Who is better at keeping in touch with others? Source: Selling Is a Womans Game: 15 Powerful Reasons Why Women Can Outsell Men, Nicki Joy & Susan Kane-Benson

Investors are looking more and more for a relationship with their financial advisers. They want someone they can trust, someone who listens. In my experience, in general, women may be better at these relationship-building skills than are men. Hardwick Simmons, CEO, Prudential Securities

Its Girls, Stupid! 1996: 8.4M women, 6.7M men in college (est: 9.2 to 6.9 in 2007); more women than men in high-level math and science courses More girls in student govt., honor societies; girls read more books, outperform boys in artistic and musical ability, study abroad in higher numbers Boys do rule: crime, alcohol, drugs, failure to do homework (4:1) Source: The Atlantic Monthly (May2000)

Okay, you think Ive gone tooooo far. How about this: DO ANY OF YOU SUFFER FROM TOO MUCH TALENT?

63 of 2,500 top earners in F500 8% Big 5 partners 14% partners at top 250 law firms 43% new med students; 26% med faculty; 7% deans Source: Susan Estrich, Sex and Power

Opportunity! U.S. G.B. E.U. Ja. M.Mgt. 41% 29% 18% 6% T.Mgt. 4% 3% 2% <1% Peak Partic. Age 45 22 27 19 % Coll. Stud. 52% 50% 48% 26% Source: Judy Rosener, Americas Competitive Secret

Encouraging signs: CEO, HP. CEO, eBay. CEO, Avon. CEO, Mirant. CEO, Xerox. President, Pharmaceutical Group, Pfizer. President, Chevron Products. Co- CEO, Kraft. President, PepsiCo. CEO, Ogilvy & Mather. COO, Enron Americas. COO, Colgate-Palmolive. President, Southwest Airlines.

Message S. Estrich: Re-invent the Culture!

S. Estrich: The Magic Number 3! [Partners, Tenured Profs, Directors]

Deloitte was doing a great job of hiring high- performing women; in fact, women often earned higher performance ratings than men in their first years with the firm. Yet the percentage of women decreased with step up the career ladder. … Most women werent leaving to raise families; they had weighed their options in Deloittes male- dominated culture and found them wanting. Many, dissatisfied with a culture they perceived as endemic to professional service firms, switched professions. Douglas McCracken, Winning the Talent War for Women [HBR]

The process of assigning plum accounts was largely unexamined. … Male partners made assumptions: I wouldnt put her on that kind of company because its a tough manufacturing environment. That client is difficult to deal with. Travel puts too much pressure on women. Douglas McCracken, Winning the Talent War for Women [HBR]

8. Weird The Cracked Ones Let in the Light!

The Cracked Ones Let in the Light Our business needs a massive transfusion of talent, and talent, I believe, is most likely to be found among non-conformists, dissenters and rebels. David Ogilvy

Are there enough weird people in the lab these days? V. Chmn., pharmaceutical house, to a lab director (06.01)

I would like to think we could attract students with green hair. We will take pink and blue and orange hair, too. Shirley Tilghman, Princeton

Would Craig Venter (Luciano Benetton) come to work for us?

9. Opportunity Make It an Adventure!

H.R. to H.E.D. ??? H uman E nablement D epartment

Titles! Manager HRIS to Manager Human Capital Assets or Manager Employee Marketing* *IHRIM.link (2-3.2001)

10. Leading Genius We are all unique!

Beware Lurking HR Types … One size NEVER fits all. One size fits one. Period.

48 Players = 48 Projects = 48 different success measures.

MantraM3 Talent = Brand

Whats your companys … EVP? Employee Value Proposition, per Ed Michaels et al., The War for Talent

EVP = Challenge, professional growth, respect, satisfaction, opportunity, reward Source: Ed Michaels et al., The War for TalentEd Michaels

First Steps Make a list of the traits you really want to unearth. (TP & sense of humor; GR & jaywalking.) Promote for TDS /Talent Development Skills. Work up an EVP.

Rule No. 1 (and there are no other rules): How do we configure our company/operation so that were truly able to provide talented people the ride of their lives? Source: Equinox Manifesto (12.01)

Brand Talent+: The Education Fiasco

FES/NOV2001: New Work. New Education. The Twain Must Meet.

TP Mood Anger. Despair. Hopelessness.

Losing the War to Bismarck (and Rockefeller)

J. D. Rockefellers General Education Board (1906): In our dreams people yield themselves with perfect docility to our molding hands. … The task is simple. We will organize children and teach them in a perfect way the things their fathers and mothers are doing in an imperfect way. John Taylor Gatto, A Different Kind of Teacher

My wife and I went to a [kindergarten] parent-teacher conference and were informed that our budding refrigerator artist, Christopher, would be receiving a grade of Unsatisfactory in art. We were shocked. How could any childlet alone our childreceive a poor grade in art at such a young age? His teacher informed us that he had refused to color within the lines, which was a state requirement for demonstrating grade-level motor skills. Jordan Ayan, AHA! Jordan Ayan

How many artists are there in the room? Would you please raise your hands. FIRST GRADE: En masse the children leapt from their seats, arms waving. Every child was an artist. SECOND GRADE: About half the kids raised their hands, shoulder high, no higher. The hands were still. THIRD GRADE: At best, 10 kids out of 30 would raise a hand, tentatively, self-consciously. By the time I reached SIXTH GRADE, no more than one or two kids raised their hands, and then ever so slightly, betraying a fear of being identified by the group as a closet artist. The point is: Every school I visited was participating in the suppression of creative genius. Gordon MacKenzie, Orbiting the Giant Hairball: A Corporate Fools Guide to Surviving with Grace

An Unnatural Way to Learn

Schools Kafka-like rituals: enforce sensory deprivation on classes of children held in featureless rooms … sort children into rigid categories by the use of fantastic measures such as age-grading, or standardized test scores … train children to drop whatever they are occupied with and to move as a body from room to room at the sound of a bell, buzzer, horn, or klaxon … keep children under constant surveillance, depriving them of private time and space … John Taylor Gatto, A Different Kind of Teacher

Kafka-like rituals (cont.): assign children numbers constantly, feigning the ability to discriminate qualities quantitatively … insist that every moment of time be filled with low- level abstractions … forbid children their own discoveries, pretending to possess some vital secret to which children must surrender their active learning time to acquire. John Taylor Gatto, A Different Kind of Teacher

Doing Stuff that Matters!

During the first years of life, youngsters all over the world master a breathtaking array of competences with little formal tutelage. Howard Gardner, The Unschooled Mind

The Learners Manifesto The brain is always learning. Learning does not require coercion. Learning must be meaningful. Learning is incidental. Learning is collaborative. The consequences of worthwhile learning are obvious. Learning always involves feelings. Learning must be free of risk. Frank Smith, Insult to Intelligence

Really bright kids who just needed to get excited teacher, Oakley School

Toms Edu3M Manifesto* *Manifesto for Education in the 3 rd Millennium

Education3M Learning is a normal state. Children are learnavores. Prodigious feats of learning are common as dirt. [Watch an H.S. QB studying game film.] We learn at different rates. We learn in different ways. Boys and girls learn [very] differently. In a class of 25, there are 25 different trajectories. Learning in 40-minutes blocks is bullshit. Learning for tests is utterly insane. There are numerous rigorous evaluation schemes, of which testing is but oneand abnormal, by real world standards.

Education3M We learn most/fastest/most completely when we are passionate about what we are learning and it matters to us. [Salience rules!] Think EBI/LBI: Education by Interest/ Learning by Internship. Classrooms are abnormal places. We need changes of pace. [Japanese recesses after each class.] International test scores are not correlated with hours-per-year in class. Big classes are slightly problematic. Big schools suck. Period.

Education3M All thisthe right stufffits the NWW/New World of Work hand-in-glove. [NWW = Age of Creativity.] U.S. schools circa 2001 are a vestige of the Prussian-Fordist model, more interested in shaping behavior than stoking the fires of lifelong learning. Cutting art-music budgets is truly dumb. Learning is a matter of Intensity of Engagement, not elapsed time. [Aargh: 11 minutes on the Battle of Gettysburg.] Teachers need enough space-time-flexibility to get to know kids as individuals. Scientific discovery processes and the teaching of science are utterly at odds. [Exploration vs. spoon-feeding.]

Education3M Our toughest learning achievement mastering our native languagedoes not require schools, or even competent parents. [It does require a desperate need-to-know.] Great teachers are great learners, not imparters- of-knowledge. Great teachers ask great questionsthat launch kids on lifelong quests. The world is not about right & wrong answers; it is about the pursuit of increasingly sophisticated questionsjust ask a ski instructor or neurosurgeon.

Education3M Most schools spend most of their time setting up contexts in which kids learn not to like particular subjects. [Evidence shows that such anti- learning sticks!] Vigorous exploration is normal … until you are incarcerated in a school. Bite size education-learning is neither education nor learning. Learning takes place rapidly on the cheerleading squad, the football team, the school newspaper, the drama club, at the after-class job--just not in the hyper-structured classroom.

Education3M The school reform movement is a giant step … backwards … embracing the Prussian-Fordist paradigm with renewed vigorat exactly the wrong time. There are large numbers of superb schools, superb principals, superb teachers; sadly, they not only fail to infect the [largely timid] rest, but are ordinarily supplanted by wusses & wimps. Alas, the teaching profession does not ordinarily attract cool dudes & dudettes. Schools of education should by and large have their charters revoked.

Education3M Stability is dead; education must therefore educate for an unknowable, ambiguous, changing future; thence, learning to learn & change is far more important than mastery of a static body of facts. Education must develop in youth the capabilities for engaging in intense concentrated involvement in an activity. [James Coleman, 1974.] [Hint: It doesnt.] [Hint: Understatement.]

The boys who made the best Grotties usually turned out to be nonentities later; boys who hated Groton did much better. FDR biographer John Gunther (quoted in Whoever Makes the Most Mistakes Wins, Richard Farson & Ralph Keyes)

Fail. Forward. Fast. High Tech CEO, Pennsylvania

Read This! Richard Farson & Ralph Keyes: Whoever Makes the Most Mistakes Wins: The Paradox of Innovation

Ye gads: Thomas Stanley has not only found no correlation between success in school and an ability to accumulate wealth, hes actually found a negative correlation. It seems that school- related evaluations are poor predictors of economic success, Stanley concluded. What did predict success was a willingness to take risks. Yet the success-failure standards of most schools penalized risk takers. Most educational systems reward those who play it safe. As a result, those who do well in school find it hard to take risks later on. Richard Farson & Ralph Keyes, He Who Makes the Most Mistakes Wins

TRENDS WORTH TRILLIONS

Trends II: Speaking of … Women.* *Duh II.

Women & the Marketspace.

????????? Home Furnishings … 94% Vacations … 92% Houses … 91% Consumer Electronics … 51% Cars … 60% (90%) All consumer purchases … 83% Bank Account … 89% Health Care … 80%

???? 80%

Riding Lawnmowers

2/3rds working women/ 50+% working wives > 50% 80% checks 61% bills 53% stock (mutual fund boom) 43% > $500K 95% financial decisions/ 29% single handed

$4.8T > Japan 9M/27.5M/$3.6T > Germany

New golfers … 37% Basketball … 13.5M 1 in 27 (70) … 1 in 3 (96)

1874 … Jock Strap 1977 … Jogbra 1977... 25K 1996 … 42 M

Yeow! 1970 … 1% 2002 … 50%

OPPORTUNITY NO. 1! * [* No shit!]

Carol Gilligan/ In a Different Voice Men: Get away from authority, family Women: Connect Men: Self-oriented Women: Other-oriented Men: Rights Women: Responsibilities

FemaleThink/ Popcorn Men and women dont think the same way, dont communicate the same way, dont buy for the same reasons. He simply wants the transaction to take place. Shes interested in creating a relationship. Every place women go, they make connections.Popcorn

Men seem like loose cannons. Men always move faster through a stores aisles. Men spend less time looking. They usually dont like asking where things are. Youll see a man move impatiently through a store to the section he wants, pick something up, and then, almost abruptly hes ready to buy. … For a man, ignoring the price tag is almost a sign of virility. Paco Underhill, Why We Buy* (*Buy this book!) Paco Underhill

Read This: Barbara & Allan Peases Why Men Dont Listen & Women Cant Read Maps

It is obvious to a woman when another woman is upset, while a man generally has to physically witness tears or a temper tantrum or be slapped in the face before he even has a clue that anything is going on. Like most female mammals, women are equipped with far more finely tuned sensory skills than men. Barbara & Allan Pease, Why Men Dont Listen & Women Cant Read Maps

Resting State: 30%, 90%: A woman knows her childrens friends, hopes, dreams, romances, secret fears, what they are thinking, how they are feeling. Men are vaguely aware of some short people also living in the house. Barbara & Allan Pease, Why Men Dont Listen & Women Cant Read Maps

As a hunter, a man needed vision that would allow him to zero in on targets in the distance … whereas a woman needed eyes to allow a wide arc of vision so that she could monitor any predators sneaking up on the nest. This is why modern men can find their way effortlessly to a distant pub, but can never find things in fridges, cupboards or drawers. Barbara & Allan Pease, Why Men Dont Listen & Women Cant Read Maps

Female hearing advantage contributes significantly to what is called womens intuition and is one of the reasons why a woman can read between the lines of what people say. Men, however, shouldnt despair. They are excellent at imitating animal sounds. Barbara & Allan Pease, Why Men Dont Listen & Women Cant Read Maps

Read This Book … EVEolution: The Eight Truths of Marketing to Women Faith Popcorn & Lys Marigold Faith Popcorn

EVEolution: Truth No. 1 Connecting Your Female Consumers to Each Other Connects Them to Your Brand

The Connection Proclivity in women starts early. When asked, How was school today? a girl usually tells her mother every detail of what happened, while a boy might grunt, Fine. EVEolution

Women dont buy brands. They join them. EVEolution

What If … What if ExxonMobil or Shell dipped into their credit card database to help commuting women interview and make a choice of car pool partners? What if American Express made a concerted effort to connect up female empty-nesters through on-line and off-line programs, geared to help women re-enter the workforce with todays skills? EVEolution

Not ! Year of the Woman

Enterprise Reinvention! Recruiting Hiring/Rewarding/Promoting Structure Processes Measurement Strategy Culture Vision Leadership THE BRAND ITSELF!

Honey, are you sure you have the kind of money it takes to be looking at a car like this?

27 March 2000: email to TP from Shelley Rae Norbeck I make 1/3 rd more money than my husband does. I have as much financial pull in the relationship as he does. Id say this is also true of most of my women friends. Someone should wake up, smell the coffee and kiss our asses long enough to sell us something! We have money to spend and nobody wants it!

STATEMENT OF PHILOSOPHY: I am a businessperson. An analyst. A pragmatist. The enormous social good of increased womens power is clear to me; but it is not my bailiwick. My game is haranguing business leaders about my fact-based conviction that womens increasing power – leadership skills and purchasing power – is the strongest and most dynamic force at work in the American economy today. Dare I say it as a long-time Palo Alto resident … THIS IS EVEN BIGGER THAN THE INTERNET! Tom Peters

Psssst! Wanna see my porn collection?

Speed Demands FFF/Instinct. Instinct = We are the customer. Thence: Become one with the customer. Thence: HOW HE/ SHE LOOKS/ FEELS/ THINKS MUST BE THE WAY WE LOOK/ FEEL/ THINK. Source: Equinox Manifesto (12.01)

If we are single, they say we couldnt catch a man. If we are married, they say we are neglecting him. If we are divorced, they say we couldnt keep him. If we are widowed, they say we killed him. Kathleen Brown, on the joys of female political candidacy

Stupid!

Ad from Furniture /Today (04.01): MEET WITH THE EXPERTS!: How Retailings Most Successful Stay that Way Presenting Experts: M = 16 ; F = ?? (94% = 272)

The Furniture Industry … doesnt understand BRANDING doesnt understand FASHION doesnt understand WOMEN doesnt understand SPEED & RESPONSIVENESS & VALUE-ADDED SERVICES doesnt understand EXCITING RETAIL PRESENTATION & EXPERIENCE MARKETING. And is run by old, conservative white guys … who dont even understand what they dont understand.

Prescription … SHE is the Consumer. (PERIOD.) SHE is the Brand. (PERIOD.) 75% women designers* (*Men CANNOT design for women. PERIOD.) 75% women reps. Cool retail spaces in high-rent districts (a la Ethan Allen). Match furniture with accessories … i.e., create an experience. FOCUS ON RELATIONSHIPS-FOR-LIFE, not transactions.

Stupid: Amazing, now that I think about it. A bunch of guys --developers, architects, contractors--sitting around designing shopping centers. And the end users will be overwhelmingly women!

Whose pelvis is it, anyway?

Stupid: Nike. The pelvis pics. Research in h.care. Georgene Terrys finding. Etc. Etc. Etc. Etc. Etc.

Harmony. From General Mills. Low-fat cereal fortified with calcium, folic acid and iron. Breakfast of Heroines. Source: Business Weeks The Best Products of 2001

Trends II: Boomer Bonanza.* *Duh III.

Age Power will rule the 21 st century, and we are woefully unprepared. Ken Dychtwald, Age Power : How the 21 st Century Will Be Ruled by the New Old

Subject: Marketers & Stupidity Its 18-44, stupid!

Subject: Marketers & Stupidity Or is it: 18-44 is stupid, stupid!

2000-2010 Stats 18-44: -1% 55+: +21% (55-64: +47%)

NOT ACTING THEIR AGE : As Baby Boomers Zoom into Retirement, Will America Ever Be the Same? USN&WR Cover/06.01

Member Growth: 1987 – 1997 18 – 34: 26% 35 – 49: 63% 50+: 118% Source: IHRSA

Aging/Elderly $$$$$$$$$$$$ Im in charge!

50+ $7T wealth (70%)/$2T annual income 50% all discretionary spending 79% own homes/40M credit card users 41% new cars/48% luxury $610B healthcare spending/74% prescription drugs 5% of advertising targets Ken Dychtwald, Age Power: How the 21 st Century Will Be Ruled by the New Old

Stupid!

No : Target Marketing Yes : Target Innovation & Target Delivery Systems

BOTTOM LINE I: BRAND INSIDE

Message 2002 … BI > BO

THINK WEIRD … the H.V.A. Bedrock.

THINK WEIRD: The High Standard Deviation Enterprise.

The corporate faith in big industrial mergers [2/3rds of which fail] is a vestige of the spats-and-spittoons era. James Suroweicki, The New Yorker (More, a Buffett annual- report quote: Many managers were overexposed in impressionable childhood years to the story in which the imprisoned handsome prince is released from a toads body by a kiss from the beautiful princess.)

Saviors-in-Waiting Disgruntled Customers Off-the-Scope Competitors Rogue Employees Fringe Suppliers Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on Fringe Competitors, Lost Customers, and Rogue Employees

Deviants, Inc. Deviance tells the story of every mass market ever created. What starts out weird and dangerous becomes Americas next big corporate payday. So are you looking for the next mass market idea? Its out there … way out there. Source: Ryan Matthews & Watts Wacker, Fast Company (03.02)

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

COMPETITORS: The best swordsman in the world doesnt need to fear the second best swordsman in the world; no, the person for him to be afraid of is some ignorant antagonist who has never had a sword in his hand before; he doesnt do the thing he ought to do, and so the expert isnt prepared for him; he does the thing he ought not to do and often it catches the expert out and ends him on the spot. Mark Twain

Employees: Are there enough weird people in the lab these days? V. Chmn., pharmaceutical house, to a lab director (06.01)

Suppliers: There is an ominous downside to strategic supplier relationships. An SSR supplier is not likely to function as any more than a mirror to your organization. Fringe suppliers that offer innovative business practices need not apply. Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on Fringe Competitors, Lost Customers, and Rogue Employees

Elliott Masie, on desirable eLearning vendors: I want a sandbox partner, someone who will openly say, This is not the last word; we dont know exactly where were going.

Step 1: TAKE SOMEONE NEW & WEIRD TO LUNCH TODAY OR TOMORROW. [Inundate yourself with weird.]

WEIRD IDEAS THAT WORK: (1) Hire slow learners (of the organizational code). (1.5) Hire people who make you uncomfortable, even those you dislike. (2) Hire people you (probably) dont need. (3) Use job interviews to get ideas, not to screen candidates. (4) Encourage people to ignore and defy superiors and peers. (5) Find some happy people and get them to fight. (6) Reward success and failure, punish inaction. (7) Decide to do something that will probably fail, then convince yourself and everyone else that success is certain. (8) Think of some ridiculous, impractical things to do, then do them. (9) Avoid, distract, and bore customers, critics, and anyone who just wants to talk about money. (10) Dont try to learn anything from people who seem to have solved the problems you face. (11) Forget the past, particularly your companys success. Bob Sutton, Weird Ideas That Work: 11½ Ideas for Promoting, Managing, and Sustaining Innovation

Innovative Culture: The Law of Proximity.* *Chase/David vs. Citi/Wriston

Advice to Corporate Leaders: Consider the metaphor of the windmill: You can harness raw power but you cant control it. … Hire artists, clowns, or other disrupters to come in and challenge your corporate environment. … Hire a corporate anthropologist to analyze how tolerant your organization is of deviants and other innovators. … Once the ahthropologist leaves, hire a shaman to drive out the evil spirits of conformity. … Source: Ryan Matthews & Watts Wacker, Fast Company (03.02)

The GM/VC model of leadership.

Logic: Cut from 1,000 brands to 500 brands, for efficiencys sake. Need 10% p.a. growth in reduced # of brands to get guaranteed corporate growth of 5%. (AND YOU DONT GET AVERAGE GROWTH IN EVERY BRANDDUH.) Hence, 10% across-the- board growth will mostly come from 40% growth in small # of brands (Pareto: 80/20 rule; blah, blah, blah). Axiom: 40% growth will only come from high-risk betsand accompanying failuresacross the portfolio. Hence, the VC [GM] model.

Axiom/Statistical Truism: The more challenging the goal and the more elusive the target … the more dependant we are on theoutliers … the serendipitous/long shot results that only emanate from a portfolio of tries/projects laden with risk. ALL HAIL THE HSDE!

Renewal = The Weird 10 = The High S.D. Enterprise/Individual Pioneer [Weird] Acquisitions Pioneer [Weird] Customers & Alliance Partners [Measure the Customer-Partner Portfolios S.D./Weirdness Index] Divide & Conquer/Sell-by [Lessons from the Bees, Sir Richard, Gary H.] Pioneer Assignments/Pioneer Projects/Pioneer Partners [F2F: Freak-to-Freak/ 4F: Find a Fellow Freak Faraway] Hire Weird [Diversity] /Train Weird/Promote Weird/Pay Gobs & Promote Fast & Cherish Six Sigma Talent/Appoint a Weird Board Weed Un-weird [One Sigma Talent, etc.] Hang out with Weird [Univ. of Weird] /Lunch with Weird/ Read & Surf Weird/Vacate Weird R.A.F. to R.F.A. to F.F.F. [O.O.D.A. Loops/Prototyping Mania] Sense of Humor [Rhapsodize Over Thine Cool Failures!] Re-enforce a Culture of Disrespect/PassionatePiracy

The Top Creators of Shareholder Value Accept depressed earnings for several quarters to support hot product Expense rather than capitalize new venture costs Bonuses without caps Source: Fortune (09.17.2001)

Organize for … performance & customer satisfaction. Disorganize for … renewal & innovation.

Brand Inside: Summary

The Brand Inside 10 BI1. The Execution Imperative: An Action Culture BI2. Cherish Failures BI3. Dent the Universe: WOW Projects/BHAGs BI4. Tell Me a Story: Demo Mania BI5. Cut the Crap: WebWorld = ALL BI6. Beautiful Systems BI7. The Modified Basis for Value Added: The New Brand Inside Warriors BI8. Talent Time BI9. The HSDE: Weird Begets Weird BI10. A Brand New/Brand You World

Tomorrows Organizations … Itinerant Potential Machines.

TALENT POOL TO DIE FOR. Youthful. Insanely energetic. Value creativity. Risk taking is routine. Failing is normal … if youre stretching. Want to make their bones in the revolution.Love the new technologies. Well rewarded. Dont plan to be around 10 years from now.

TALENT POOL PLUS. Seek out and work with worlds best as needed (its often needed). We aim to change the world, and we need gifted colleagueswho well may not be on our payroll.

BRASSY-BUT-GROUNDED-LEADERSHIP. Say I dont knowand then unleash the TALENT. Have a vision to be DRAMATICALLY DIFFERENTbut dont expect the co. to be around forever. Will scrap pet projects, and change course 180 degreesand take a big write-off in the process. NO REGRETS FROM SCREW-UPS WHOSE TIME HAS NOT-YET- COME. GREAT REGRETS AT TIME & $$$ WASTED ON ME TOO PRODUCTS AND PROJECTS.

BRASSY-BUT-GROUNDED-LEADERSHIP. (Cont.) Visionary leaders matched by leaders with shrewd business sense: HOW DO WE TURN A PROFIT ON THIS GORGEOUS IDEA? Appreciate market creation as much as or more than market share growth. ARE INSANELY AWARE THAT MARKET LEADERS ARE ALWAYS IN PRECARIOUS POSITIONS, AND THAT MARKET SHARE WILL NOT PROTECT US, IN TODAYS VOLATILE WORLD, FROM THE NEXT KILLER IDEA AND KILLER ENTREPRENEUR. (Gates. Ellison. Venter. McNealy. Walton. Case. Etc.)

ALLIANCE MANIACS. Dont assume that the best resides within. WORK WITH A SHIFTING ARRAY OF STATE-OF-THE-ART PARTNERS FROM ONE END OF THE SUPPLY CHAIN TO THE OTHER. Including vendors and consultants and … especially … PIONEERING CUSTOMERS … who will pull us into the future.

TECHNOLOGY-NETWORK FANATICS. Run the whole-damn-company, and relations with all outsiders, on the Internet … at Internet speed. Reluctant to work with those who dont share this (radical) vision.

POTENTIAL MACHINES-ORGANISMS. Dont know whats coming next. But are ready to jump at opportunities, especially those that challenge-overturn our own way of doing things.

In a world of no rules … passion-based talent, ideas & speed are the only rules. Source: Equinox Manifesto (12.01)

NewGov2002.

WE NEED … IDEAS!

Ideas > Leadership

NO: Good govt YES: EFFECTIVE Govt (in altered/ambiguous times)

A Plea for virtual [RESPONSIVE] government

Agile.

WALLS MUST FALL!

The W.O.G. (Work-of- Government): Insta- Targeted WPTs (WOW (B.H.A.G.) Project Teams (with clout) )

Experiments rule!

Failures rule!

Talent matters!

IS/IT to the Max!

S treamlined procurement (esp. IS/IT)

THE MARINES LEARN NEW TACTICS FROM WAL*MART Business Week (12.24.2001)

BOTTOM LINE II: LEADING IN TOTALLY SCREWED UP TIMES

The Leadership 50

The Context.

Uncertainty: We dont know when things will get back to normal. Ambiguity: We no longer know what normal means.

prior 900 years 1900s: 1 st 20 years > 1800s 2000: 10 years for paradigm shift 21 st century: 1000X tech change than 20 th century (the Singularity, a merger between humans and computers that is so rapid and profound it represents a rupture in the fabric of human history) Ray Kurzweil

1 day 2001 = Years trade in 1949, years FEX in 1979, years global calls in 1984. Source: Charles Handy, The Elephant and the Flea

The Basic Premise.

1. Leadership Is a … Mutual Discovery Process.

Leaders-Teachers Do Not Transform People! Instead leaders-mentors-teachers (1) provide a context which is marked by (2) access to a luxuriant portfolio of meaningful opportunities (projects) which (3) allow people to fully (and safely, mostlycaveat: they dont engage unless theyre mad about something) express their innate curiosity and (4) engage in a vigorous discovery voyage (alone and in small teams, assisted by an extensive self-constructed network) by which those people (5) go to-create places they (and their mentors-teachers- leaders) had never dreamed existedand then the leaders-mentors-teachers (6) applaud like hell, stage photo-ops, and ring the church bells 100 times to commemorate the bravery of their followers explorations!

I am inalterably opposed to organization change, empowerment, motivation. The goal: to awaken the latent talent already within, by providing opportunities worthy of the individuals investment of her or his most precious resources … time and emotional commitment.

1A. Leaders … Cede Control.

I dont know.

The leader who says I dont know essentially says that the group is facing a new ballgame where the old tools of logic may be its undoing rather than its salvation. To drop these tools is not to give up on finding a workable answer. It is only to give up on one means of answering that is ill-suited to the unstable, the unknowable, the unpredictable. To drop the heavy tools of rationality is to gain access to lightness in the form of intuitions, feelings, stories, experience, active listening, shared humanity, awareness in the moment, capability for fascination, awe, novel words and empathy. - Karl Weick

1B. Leaders Try … Not to Screw Things Up

Ninety percent of what we call management consists making it difficult for people to get things done. – P.D.

The Leadership Types.

2. Great Leaders on Snorting Steeds Are Important – but Great Talent Developers (Type I Leadership) are the Bedrock of Organizations that Perform Over the Long Haul.

25/8/53* (*Damn it!)

Whoops: Jack didnt have a vision!

2A. Just One: Great Leading = Great Mentoring.

T.A.: 3

Goal of the Year No. 1*: Find- Develop-Mentor ONE Extraordinary Person. *CEO, large financial advisory firm, April 2001

2B. Great Leaders are … Great V.C.s.

Basically [Omnicoms John] Wren makes aggressive bets on entrepreneurs and gives them tremendous autonomy, on the assumption that the risk-taking will pay off in new ideas, connections, businesses, and, yes, revenues and profits. … Omnicom operates like a venture-capital firm, says Sir Martin Sorrell [of WPP]. Fortune (09.17.2001)

3. But Then Again, There Are Times When This Cult of Personality (Type II Leadership) Stuff Actually Works!

A leader is a dealer in hope. Napoleon (+TPs writing room pics)

4. Find the Businesspeople! (Type III Leadership)

I.P.M. (Inspired Profit Mechanic)

4A. All Organizations Need the Golden Leadership Triangle.

The Golden Leadership Triangle: (1) Creator- Visionary … (2) Talent Fanatic-Mentor-V.C. … (3) Inspired Profit Mechanic.

Project Team Golden Triangle (1) Champion-Maniac. (2) Implementer-Pol. (3) Schedule & Budgets Fanatic.

5. Leadership Mantra #1: IT ALL DEPENDS!

Renaissance Men are … a snare, a myth, a delusion!

6. The Leader Is Rarely/Never the Best Performer.

33 Division Titles. 26 League Pennants. 14 World Series: Earl Weaver0. Tom Kelly0. Jim Leyland0. Walter Alston1AB. Tony LaRussa132 games, 6 seasons. Tommy LasordaP, 26 games. Sparky Anderson1 season.

The Leadership Dance.

7. Leaders … SHOW UP!

P.S. … Mark McCormack: 5,000 miles for a 5 min. meeting !

7A. Leaders … LOVE the MESS!

If things seem under control, youre just not going fast enough. Mario Andretti

7B. Leadership Is Improv!

Duct Tape Rules! Andrew Higgins, who built landing craft in WWII, refused to hire graduates of engineering schools. He believed that they only teach you what you cant do in engineering school. He started off with 20 employees, and by the middle of the war had 30,000 working for him. He turned out 20,000 landing craft. D.D. Eisenhower told me, Andrew Higgins won the war for us. He did it without engineers. Stephen Ambrose/Fast Company

8. Leaders Groove on AMBIGUITY!

Most of our predictions are based on very linear thinking. Thats why they will most likely be wrong. Vinod Khosla, in GIGATRENDS, Wired 04.01

9. Leaders DO!

The Kotler Doctrine: 1965-1980: R.A.F. (Ready.Aim.Fire.) 1980-1995: R.F.A. (Ready.Fire!Aim.) 1995-????: F.F.F. (Fire!Fire!Fire!)

9A. Leaders Re -do.

Sony Electronics has a well- earned reputation for persistence. The companys first entry into a new field often isnt very good. But, as it has shown in laptops, Sony will keep trying until it gets it right. Business Week (5/01)

If Microsoft is good at anything, its avoiding the trap of worrying about criticism. Microsoft fails constantly. Theyre eviscerated in public for lousy products. Yet they persist, through version after version, until they get something good enough. Then they leverage the power theyve gained in other markets to enforce their standard. Seth Godin, Zooming

He who has the quickest O.O.D.A. Loops * wins! *Observe. Orient. Decide. Act. / Col. John Boyd

9B. Leaders Are PLAYFUL.

You cant 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

Axiom: Never trust a boss with no toys in his/her office!

10. BUT … Leaders Know When to Wait.

Tex Schramm: The too hard box!

Leaders know when to … RETREAT.

Axioms: (1) Pick your battles carefully. (2) Sometimes inaction promotes sorting out & preserves options.

11. Leaders … DELIVER!

11A. Leaders KNOW They Can Make a Difference!

Leaders dont want to win. Leaders need to win. #49

WILLPOWER RULES! (12.12.2001) In the end the war is not about statistics, deadlines, short attention spans of 24 hour news cycles. Its about will, the projection of will, the clear, unambiguous determination of the president of the United States and the American people to see this through.DR. Given our lack of knowledge, LT investments made on the basis of animal spiritsa spontaneous urge to action rather than inaction, not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities.JMK. Texas top ten percenters GPAs > than those with SATs 200-300 points higher.

A real superstar is mean in a particular way. He is Michael Jordan or Cal Ripken, greedy for records and history. Armored and self-contained, his inner core is a hard knot of physical talent and fierce will. Nothing penetrates that core, and anybody or anything that gets too close is out of his life. Michael Sokolove, The last Straw

11B. Leaders Are … Optimists.

Hackneyed but none the less true: LEADERS SEE CUPS AS HALF FULL.

Half-full Cups: [Ronald Reagan] radiated an almost transcendent happiness. Lou Cannon, George (08.2000)

12. BUT … Leaders Are Realists/Leaders Win Through LOGISTICS!

The Gus Imperative!

Journeyman vs. Cooperstown Candidate: 1 hit / week.

13. Leaders FOCUS!

To Dont List

14. Leaders … Set CLEAR DESIGN SPECS.

JackWorld/ 1@T : (1) Neutron Jack. (Banish bureaucracy.) (2) 1, 2 or out Jack. (Lead or leave.) (3) Workout Jack. (Empowerment, GE style.) (4) 6-Sigma Jack. (5) Internet Jack. (Throughout) TALENT JACK!

Danger: S.I.O. (Strategic Initiative Overload)

15. Leaders … Send V-E-R-Y Clear Signals About Design Specs!

Ridin with Roger: What have you done to DRAMATICALLY IMPROVE quality in the last 90 days?

Its Relationships, Stupid.

16. Leaders Trust in TRUST !

Credibility !

Credibility: GWB /dc/dr/pw ( RR /bc, RN /hak) vs. BC /ag/sb ( JC )

16A. Leaders Infuse the Dreaded-All Important Evaluation Process with CREDIBILITY!

25 = 100

17. Leaders … Understand the Ultimate Power of RELATIONSHIPS.

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, Americas Competitive Secret Judy Rosener

17A. Leaders Wire the Joint!

Winners wire. Losers are slaves to rank.

TAKE THIS QUICK QUIZ: Who manages more things at once? Who puts more effort into their appearance? Who usually takes care of the details? Who finds it easier to meet new people? Who asks more questions in a conversation? Who is a better listener? Who has more interest in communication skills? Who is more inclined to get involved? Who encourages harmony and agreement? Who has better intuition? Who works with a longer to do list? Who enjoys a recap to the days events? Who is better at keeping in touch with others? Source: Selling Is a Womans Game: 15 Powerful Reasons Why Women Can Outsell Men, Nicki Joy & Susan Kane-Benson

17B. Leaders Are Natural EMPOWERMENT FREAKS!

17C. Leaders Know … Women Roar/ Women Rule.

AS LEADERS, WOMEN RULE: New Studies find that female managers outshine their male counterparts in almost every measure Title, Special Report, Business Week, 11.20.00

Womens Strengths Match New Economy Imperatives: Link [rather than rank] workers; favor interactive-collaborative leadership style [empowerment beats top-down decision making]; sustain fruitful collaborations; comfortable with sharing information; see redistribution of power as victory, not surrender; favor multi-dimensional feedback; value technical & interpersonal skills, individual & group contributions equally; readily accept ambiguity; honor intuition as well as pure rationality; inherently flexible; appreciate cultural diversity Source: Judy B. Rosener, Americas Competitive Secret

(17D. Oh Yeah … and Women Buy All the Stuff)

$4.8T > Japan 9M/27.5M/$3.6T > Germany

18. Leaders … Find & Feed Off Supporters.

Jill Ker Conway: (1) On- campus renegades. (2) Alumnae: $$$$ to fund programs that the culture wouldnt support.

Message JKC: (1) Leaders are Masters of the End Run. (2) Avoid the Old Culturedont confront it. (3) You cant change people, you cant change culture. (4) Instead you supplant them/surround themWe select (DARWIN RULES!) carriers of the new culture.

If It Aint Broke … Break It.

19. Leaders … FORGET!/ Leaders … DESTROY!

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

Forbes100 from 1917 to 1987: 39 members of the Class of 17 were alive in 87; 18 in 87 F100; 18 F100 survivors underperformed the market by 20%; just 2 (2%), GE & Kodak, outperformed the market 1917 to 1987. S&P 500 from 1957 to 1997: 74 members of the Class of 57 were alive in 97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997. Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market

Good management was the most powerful reason [leading firms] failed to stay atop their industries. Precisely because these firms listened to their customers, invested aggressively in technologies that would provide their customers more and better products of the sort they wanted, and because they carefully studied market trends and systematically allocated investment capital to innovations that promised the best returns, they lost their positions of leadership. Clayton Christensen, The Innovators Dilemma

Cortez!

Leaders dump the ones who brung em Nokia, HP, 3M, PerkinElmer, Corning, etc.

The [New] G e Way DYB.com

20. BUT … Leaders Have to Deliver, So They Worry About Throwing the Baby Out with the Bathwater.

Damned If You Do, Damned If You Dont, Just Plain Damned. Subtitle in the chapter, Own Up to the Great Paradox: Success Is the Product of Deep Grooves/ Deep Grooves Destroy Adaptivity, Liberation Management (1992)

21. Leaders … HONOR THE USURPERS.

Saviors-in-Waiting Disgruntled Customers Upstart Competitors Rogue Employees Fringe Suppliers Wayne Burkan, Wide Angle Vision

22. Leaders … HANG OUT WITH FREAKS!

The Cracked Ones Let in the Light Our business needs a massive transfusion of talent, and talent, I believe, is most likely to be found among non-conformists, dissenters and rebels. David Ogilvy

Axiom: Never hire anyone without an aberration in their background!

Are there enough weird people in the lab these days? V.Chmn., pharmaceutical house, to a lab director (06.01)

Would Craig Venter (Luciano Benneton) come to work for us?

I would like to think we could attract students with green hair. We will take pink and blue and orange hair too. Shirley Tilghman, Princeton

Yikes: What worries me is that I cant see why any ambitious young person would want to join my company, or stay here for long if they did join. My most important job is to change that as fast as I can. CEO, giant multinational, to Charles Handy

Message: TAKE SOMEONE NEW & WEIRD TO LUNCH TODAY OR TOMORROW. [Inundate yourself with weird.]

Leaders know … WE BECOME WHO WE HANG WITH!

23. Leaders Make [Lotsa] Mistakes – and MAKE NO BONES ABOUT IT!

Sams Secret #1!

Fail faster. Succeed sooner. David Kelley/IDEO

24. Leaders Make … BIG MISTAKES!

Reward excellent failures. Punish mediocre successes. Phil Daniels, Sydney exec (and, de facto, Jack)

24A. Leaders Honor Mistakes & Create Blame-free Cultures.

Accountability: YES! Never-ending witch hunts: NO!

Winning By Acknowledging Failures Wernher Von Braun, the Redstone missile engineer who confessed & the bottle of champagne. Award to the sailor on the Carl Vinsonfor reporting the lost tool. Amy Edmonson & the successful nursing units with the highest reported adverse drug events. Source: Karl Weick & Kathleen Sutcliffe, Managing the Unexpected

Create.

25. Leaders Know that THERES MORE TO LIFE THAN LINE EXTENSIONS. Leaders Love to CREATE NEW MARKETS.

No one ever made it into the Business Hall of Fame on a record of line extensions.

Acquisitions are about buying market share. Our challenge is to create markets. There is a big difference. Peter Job, CEO, Reuters

The Top Creators of Shareholder Value Accept depressed earnings for several quarters to support hot product Expense rather than capitalize new venture costs Bonuses without caps Source: Fortune (09.17.201)

The highest performing companies have well-developed systems for killing ideas their customers dont want. As a result, these companies find it very difficult to invest adequate resources in disruptive technologieslower margin opportunities that their customers dont wantuntil they want them. And by then its too late. Clayton Christensen, The Innovators Dilemma

26. Leaders Pursue DRAMATIC DIFFERENCE!

1 st Law Mktg Physics: OVERT BENEFIT (Focus: 1 or 2 > 3 or 4/One Great Thing. Source #1: Personal Passion) 2 ND Law: REAL REASON TO BELIEVE (Stand & Deliver!) 3 RD Law: DRAMATIC DIFFERENCE (Execs Dont Get It: intent to purchase – 100%; unique – 0% to 5%) Source: Jump Start Your Business Brain, Doug HallDoug Hall

The greatest danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it. Michelangelo

26A. Leaders … Make Their Mark / Leaders … Do Stuff That Matters

Ideas > Leadership

Today the problem is not how to produce more to sell more. The fundamental question is that of the products right to exist. And it is the designers right and duty to question the legitimacy of the product. Philippe Starck

NO: Good govt YES: EFFECTIVE Govt (in altered/ambiguous times)

By combining powerful computer technology and other modern information-based systems we could make a revitalized, leaner military force that is designed to outsee, outmaneuver and outfight any foe. --Bill Owens, Lifting the Fog of War

27. Leaders Push Their Organizations W-a-y Up the Value-added/ Intellectual Capital Chain

09.11.2000: HP bids $18,000,000,000 for PricewaterhouseCoopers Consulting business!

These days, building the best server isnt enough. Thats the price of entry. Ann Livermore, Hewlett-Packard

Springs Collections. Flexible sourcing. Packaging. Merchandising. Promotion. Design. Systems & Site mgt. = Turnkey.

28. Leaders LOVE the New Technology!

100 square feet

Theres no use trying, said Alice. One cant believe impossible things. I daresay you havent had much practice, said the Queen. When I was your age, I always did it for half an hour a day. Why, sometimes Ive believed as many as six impossible things before breakfast. Lewis Carroll

Inet … … allows you to dream dreams you could never have dreamed before!

28A. Needed? Type IV Leadership: Technology Dreamer-True Believer

The Golden Leadership Quadrangle: (1) Creator- Visionary … (2) Talent Fanatic-Mentor-V.C. … (3) Inspired Profit Mechanic. (4) Technology Dreamer-True Believer

Talent.

29. When It Comes to TALENT … Leaders Always Swing for the Fences!

Message: Some people are better than other people. Some people are a helluva lot better than other people.

30. Leaders Dont Create Followers: THEY CREATE LEADERS!

Brand You, Big Time! I AM AN ARMY OF ONE

31. Leaders Win Followers Over

WHAT AN IDIOT: Instead of employees being in the drivers seat, now were in the drivers seat.

PJ: Coaching is winning players over.

32. Leaders Manage Their EVP/ Internal Brand Promise.

MantraM3 Talent = Brand

EVP = Challenge, professional growth, respect, satisfaction, opportunity, reward Source: Ed Michaels et al., The War for Talent

33. Leaders LOVE RAINBOWS – for Pragmatic Reasons.

Diversity defines the health and wealth of nations in a new century. Mighty is the mongrel. … The hybrid is hip. The impure, the mélange, the adulterated, the blemished, the rough, the black-and-blue, the mix-and-match – these people are inheriting the earth. Mixing is the new norm. Mixing trumps isolation. It spawns creativity, nourishes the human spirit, spurs economic growth and empowers nations. G. Pascal Zachary, The Global Me: New Cosmopolitans and the Competitive Edge

33A. Leaders Pursue Poets!

Gardners MI7: Logical- mathematical, Linguistic, Spatial, Musical, Bodily-kinesthetic, Interpersonal, Intrapersonal.

Expose yourself to the best things humans have done, and then try to bring those things into what youre doing. Steve Jobs

Passion.

34. Leaders … Out Their PASSION!

G.H.: Create a cause, not a business.

35. Leaders Know: ENTHUSIASM BEGETS ENTHUSIASM!

BZ: I am a … Dispenser of Enthusiasm!

36. Leaders Focus on the SOFT STUFF!

Soft Is Hard - ISOE

Message: Leadership is all about love! [Passion, Enthusiasms, Appetite for Life, Engagement, Commitment, Great Causes & Determination to Make a Damn Difference, Shared Adventures, Bizarre Failures, Growth, Insatiable Appetite for Change.] [Otherwise, why bother? Just read Dilbert. TPs final words: CYNICISM SUCKS.]

36A. Leaders Know … Culture Change Takes But a Minute. (No Bull!)

What Do I Do First? One Minute Excellence!* *Thomas Watson

Culture Change is not Corporate. Culture Change is not a Program. Culture change does not take Years. Culture Change does not start Today. Culture Change starts Right Now! Culture Change Lives in the Moment! Culture Change is Entirely in Your Hands!

The Job of Leading.

37. Leaders Know Its ALL SALES ALL THE TIME.

TP: If you dont LOVE SALES … find another life. (Dont pretend youre a leader.) (See TPs The Project50.)

37A. Leaders LOVEPOLITICS.

TP: If you dont LOVE POLITICS … find another life. (Dont pretend youre a leader.)

38. But … Leaders Also Break a Lot of China

If youre not pissing people off, youre not making a difference!

Characteristics of the Also rans* Minimize risk Respect the chain of command Support the boss Make budget *Fortune, article on Most Admired Global Corporations

Joe J. Jones 1942 – 2001 HE WOULDA DONE SOME REALLY COOL STUFF BUT … HIS BOSS WOULDNT LET HIM!

39. Leaders Give … RESPECT!

It was much later that I realized Dads secret. He gained respect by giving it. He talked and listened to the fourth-grade kids in Spring Valley who shined shoes the same way he talked and listened to a bishop or a college president. He was seriously interested in who you were and what you had to say. Sara Lawrence-Lightfoot, Respect

Leaders are living individuals whom employees smell, feel, touch their presence. #49

It is impossible to claim that all good teachers use similar techniques: some lecture nonstop and others speak very little; some stay close to their material and others loose the imagination; some teach with the carrot and others with the stick. But in every instance, good teachers share one trait: a strong sense of personal identity infuses their work. Dr. A is really there when he teaches. Mr. B has such enthusiasm for his subject. You can tell that this is really Prof. Cs life. Parker Palmer, The Courage to Teach

40. Leaders Say Thank You.

The deepest human need is the need to be appreciated. William James

The two most powerful things in existence: a kind word and a thoughtful gesture. Ken Langone, CEO, Invemed Associates [from Ronna Lichtenberg, Its Not Business, Its Personal]

40A. Leaders Are … Graceful.

My favorite word is grace – whether its amazing grace, saving grace, grace under fire, Grace Kelly. How we live contributes to beauty – whether its how we treat other people or the environment. Celeste Cooper, designer

Rodales on Grace … elegance … charm … loveliness … poetry in motion … kindliness.. benevolence … benefaction … compassion … beauty

41. Leaders LISTEN!

See Stephen! (Empathetic Listening)

41A. Leaders Are … Curious.

41B. Leaders Are … Great Learners.

TP/08.2001: The Three Most Important Letters … WHY?

42. Leadership Is a … Performance.

It is necessary for the President to be the nations No. 1 actor. FDR

43. Leaders … Are The Brand

WHO ARE YOU [these days] ? TP to Client

We are in the twilight of a society based on data. As information and intelligence become the domain of computers, society will place more value on the one human ability that cannot be automated: emotion. Imagination, myth, ritual - the language of emotion - will affect everything from our purchasing decisions to how we work with others. Companies will thrive on the basis of their stories and myths. Companies will need to understand that their products are less important than their stories. Rolf Jensen, Copenhagen Institute for Future Studies

The BRAND lives (OR DIES) in the minutiae of the leaders moment- to-moment actions.

You must be the change you wish to see in the world. Gandhi

44. Leaders … Have a GREAT STORY!

A key – perhaps the key – to leadership is the effective communication of a story. Howard Gardner Leading Minds: An Anatomy of Leadership

Early in my career in the law I learned that … he who has the best story wins. JQ Adams/A Hopkins to T Joadson/M Freeman

Stories of identity – narratives that help individuals think about and feel who they are, where they come from, and where they are headed – constitute the single most powerful weapon in the leaders arsenal. Howard Gardner, Leading Minds: An Anatomy of Leadership

MB S A!* *Managing By Story-ing Around/David Armstrong

Leaders dont just make products and make decisions. Leaders make meaning. – John Seeley Brown

45. Leaders Seed & Pursue & Recognize (Weird) Demos.

45A. Leaders Create BUZZ!

L.B.I.W.D. (Leading By Inducing Weird Demos)

Leaders aimed on changing their world identify palpable heroes, who executed palpable projects they point to these people and say to the masses, See, here it is, done by one of your own. (And then they deep-dip a few of those heroes to demo their seriousness.)

Each VP a V.C.: Portfolio of high-risk investments in people & ideas from all across the company.

Introspection.

46. Leaders … Enjoy Leading.

Warrens Whoops Moment …

Warren, I know you want to be president. But do you want to do president?

Thom Mayer: Docs who want to heal the sick vs. Docs who want to be M.D.s.

46A. Leaders … KNOW THEMSELVES.

Individuals (would-be leaders) cannot engage in a liberating mutual discovery process unless they are comfortable with their own skin. (Leaders who are not comfortable with themselves become petty control freaks.)

46B. But … Leaders have MENTORS.

The Gospel According to TP: Upon having the Leadership Mantle placed upon thine head, thou shalt never hear the unvarnished truth again!* (*Therefore, thy needs one faithful compatriot to lay it on with no jelly.)

47. Leaders LAUGH!

47A. But … Leaders Know Its My Fault.

You recruited em. You hired em. You trained em. You evaluated em. You motivated em.

47B. Leaders Dont Scapegoat / Allow Scapegoating.

When a plane crashes, they ask, What happened? In medicine they ask: Whose fault was it? James Bagian, M.D. & former astronaut, now working with the VHA.

48. Leaders … Take Breaks.

Zombie! Zombie!

The End Game.

49. Leaders ??? :

Leadership is the PROCESS of ENGAGING PEOPLE in CREATING a LEGACY of EXCELLENCE.

Its only business, not personal … IT ALWAYS IS PERSONAL.

Hire smart – go bonkers – have grace – make mistakes – love technology – start all over again.

LEADERS NEED TO BE THE ROCK OF GIBRALTAR ON ROLLER BLADES

Bonus: Boss Talk

Branding: Kevin Roberts: The great brands have mystery and sensuality. Apple is the most sensual product since the vibrator./ Tina Brown: You should be able to throw a magazine on the floor at any page and know whose magazine it is./

The Perils of Me-too: Stephen Hardis (Eaton): Dont have your resources trapped in areas that are inherently zero-sum games with a very marginal return./ Phil Condit (Boeing): Just doing what your competitor does is the biggest opportunity to lose money. Douglas and Lockheed built tri-jets to the identical specs and beat each other silly.

Jeff Bezos: Its easy to let the in- box side of your life overwhelm you, so you become a totally reactive person. The only remedy I know is to set aside some fraction of your time as your own. I use Tuesdays and Thursdays as my proactive days, when I try not to schedule meetings.

Jeff Bezos: I'm often encouraging people to go faster, even if it means a worse initial product. I want us to start learning. The cost of trying to avoid mistakes is huge in terms of speed.

Robert Miller (Federal-Mogul), on Turnarounds: (1) Tell the truth. Play it straight. (2) Make decisions. Dont study things to death. (3) Listen to your customers. They are usually more perceptive than you are about what needs to be done.

Juergen Schrempp/DaimlerChrysler Digital decision making/ the danger of the deadly wish for harmony

Boss Talk/WSJ Provide a simple, clear, exciting & energizing focus. Obsess on TALENT. Speed > Perfection. (Clarity, motivation, rapid adjustment.) Leap > Line extension. (Beware me-too, perfecting yesterday.) Tell the truth. Control your calendar. Get out of the office. Listen to customers face-to-faceat their place.

50. Leaders Know WHEN TO LEAVE!

Thank You!

Tom Peters 2002 We Are In A Brawl With No Rules! MASTER/03.17.2002.

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Tom Peters 2002 We Are In A Brawl With No Rules! MASTER/03.17.2002.

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