Brand
Inside
Tom Peters
v02.23.2002
1. An “Action
Culture.”
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
“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 Innovator’s Dilemma
“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
“Acquisitions are about
buying market share. Our
challenge is to
create markets.
There is a big difference.”
Peter Job, CEO, Reuters
“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 D’Aveni, Hypercompetition: Managing the Dynamics of
Strategic Maneuvering
Leaders “dump
the
ones who brung
’em” —Nokia, HP, 3M,
PerkinElmer, Corning, etc.
Cortez!
The [New] Ge Way
DYB.com
If you’re not
pissing people off,
you’re not making
a difference!
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
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.
“Leaders don’t
‘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. It’s 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 spirits—a 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.
Hackneyed but none the less
LEADERS SEE
CUPS AS “HALF
FULL.”
true:
BZ: “I am a …
Dispenser of
Enthusiasm!”
“A leader is a
dealer in
hope.”
Napoleon
(+TP’s writing room pics)
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!)
Think about It!?
Innovation = Reaction to
the Prototype
Michael Schrage
“Sony Electronics has a wellearned reputation for persistence.
The company’s first entry into a
new field often isn’t 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, it’s
avoiding the trap of worrying about
criticism. Microsoft fails constantly.
They’re eviscerated in public for lousy
products. Yet they persist, through
version after version, until they get
something good enough. Then they
leverage the power they’ve 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
“You can’t be a serious innovator
unless and until you are ready,
willing and able to seriously play.
‘Serious play’ is not an oxymoron;
it is the essence of innovation.”
Michael Schrage,
Serious Play
The “Gus
Imperative”!
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 can’t 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
P.S. …
5,000
miles for a 5
min. meeting!
Mark McCormack:
Scaled De-Compression, Rule Of …
5 days “on the
ground” = 5 weeks
(MONTHS?) in absentia
Danger:
S.I.O.
(Strategic
Initiative Overload)
1@T: (1) Neutron
JackWorld/
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!
Ridin’ with Roger: “What
have
you done to
DRAMATICALLY
IMPROVE quality in the
last 90 days?”
2. Work that
Matters: WOW
Projects/
BHAGs.
“Let’s make a
dent in the
universe.”
Steve Jobs
“Intimidate their
[users] imaginations”
… “Where’s the
revolution?” –J Allard,
on the Xbox
Language
matters! Wow!
BHAG! “Takes
your breath
away!”
1st Law Mktg Physics: OVERT BENEFIT (Focus: 1 or 2 > 3 or
4/“One Great Thing.”
Source #1: Personal Passion)
2ND Law: REAL REASON TO BELIEVE (Stand & Deliver!)
3RD Law: DRAMATIC
DIFFERENCE (Execs Don’t Get It:
“intent to purchase”—100%; “unique”—0% to
5%)
Source: Jump Start Your Business Brain, Doug Hall
Joe J. Jones
1942 – 2001
HE WOULDA DONE SOME
REALLY COOL STUFF
BUT …
HIS BOSS WOULDN’T
HIM!
LET
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
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.”
Characteristics of the “Also rans”*
“Minimize risk”
“Respect the chain of
command”
“Support the boss”
“Make budget”
*Fortune, article on
“Most Admired Global Corporations”
Goal: Drive
out fear.
(Deming
et al.)
Solution:
(alone?)
Passion
drives out fear.
Source: Equinox Manifesto (12.01)
3. Demo
Mania.
Demos!
Heroes!
Stories!
L.B.I.W.D.
Inducing Weird Demos)
(Leading By
MB
A!*
*Managing By Story-ing Around/David Armstrong
“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
he who has
the best story
wins.”
that …
JQ Adams/A Hopkins to T Joadson/M Freeman
G.M. … V.C. …
W.P. …
M.B.S.A.
Each VP a V.C.: Portfolio
of high-risk investments in
people & ideas from all
across the company.
“Basically [Omnicom’s 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)
“So …
tell me a
story.”
Boss Mantra #1:
4. Web World =
ALL: The
“Friction-free
Enterprise.”
108 X 5
vs.
8X1
= 540 vs. 8 (-98.5%)
N.W.O./Holy Moly:
Unemployment up 2%
… Real wage growth
highest since 60s …
Productivity soaring.
Source: BW/02.11.2002
Dell’s OptiPlex Facility
Big Job: 6
to 8 hours.
(80,000 per day)
Parts Inventory:
square feet.
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)
The Real “News”: X1,000,000
TowTruckNet.com
WebWorld = Everything
Web as a way to run your business’s innards
Web as connector for your entire supply-demand chain
Web as “spider’s 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 World’s 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,
bottleneckedcommunication, 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
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, he’s taken to Company X’s personalized
home page. He can interact with the entire scope of
Company X’s 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 don’t
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)
CGE&Y (Paul Cole): “Pleasant
“Systemic
Opportunity.” “Better job
of what we do today” vs. “Rethink overall
enterprise strategy.”
Transaction” vs.
Suppose, just suppose, that the Web is a new world
we’re just beginning to inhabit. We’re like the earlier
European settlers in the United States, living on the
edge of the forest. We don’t know what’s there and we
don’t 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 doesn’t hold
here, and uncommon sense hasn’t yet emerged.”
David Weinberger, Small Pieces Loosely Joined
“There’s no use trying,” said Alice.
“One can’t believe impossible things.”
“I daresay you haven’t had much
practice,” said the Queen. “When I was
your age, I always did it for half an
hour a day. Why, sometimes I’ve
believed as many as six impossible
things before breakfast.”
Lewis Carroll
I’net …
allows you to
dream dreams
you could never
have dreamed
before!
…
Q: Is that all there is?
A: Quite possibly.
“Roche’s 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.”
5. “Beautiful”
Systems.
Fred S.’s “mediocre”
thesis. Herb K.’s
napkin.
Read It Closely: “We
don’t sell
We
sell speed.”
insurance anymore.
Peter Lewis, Progressive
Great design =
One-page
business plan (Jim
Horan)
K.I.S.S.:
Gordon Bell (VAX
500/50.
daddy):
Chas.
Wang (CA): Behind schedule?
Cut least
productive 25%.
“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 can’t
believe they’re done)
30% of revenues directly from
site (vs. 6% for others)
Source: Business Week (09.00)
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!
have. Must
hate. / Must
design. Must undesign.
Systems: Must
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)
“Ninety percent of what
we call ‘management’
consists of making it
difficult for people to
get things done.”—P.D.
6. “Departments”
as Heroes: New
Bases for Value
Added.
The
Day!
09.11.2000: HP bids
$18,000,000,000
for
PricewaterhouseCoopers
consulting business!
“These days, building
the best server isn’t
enough. That’s the
price of entry.”
Ann Livermore, Hewlett-Packard
“We want to be the
air traffic
controllers of
electrons.”
Bob Nardelli, GE Power Systems
“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)
Keep In Mind:
Customer
Satisfaction
versus
Customer
Success
7. Talent:
The 25/8/53
Obsession.
25/8/53*
(*Damn it!)
“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
From “1, 2 or you’re out” [JW]
to …
“Best Talent in each
industry segment to build
best proprietary
intangibles” [EM]
Source: Ed Michaels, War for Talent (05.17.00)
“We believe companies can increase their
market cap 50 percent in 3 years. Steve
changed 20 of
his 40 box plant managers to put
more talented, higher paid
managers in charge. He increased
Macadam at Georgia-Pacific
profitability from $25 million to $80 million in 2
years.”
Ed Michaels, War for Talent (05.17.00)
“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)
Message: Some
people are
better than other
people. Some people
are a helluva lot
better than other
people.
8. Automatic
Renewal:
The “HSDE.”
Saviors-in-Waiting
Disgruntled Customers
Upstart Competitors
Rogue Employees
Fringe Suppliers
Wayne Burkan, Wide Angle Vision
“The corporate faith in big
industrial mergers
is a vestige of the
spats-and-spittoons era.”
[2/3rds of which
fail]
—James Suroweicki, The New Yorker (More, a Buffett annualreport quote: “Many managers were overexposed in
impressionable childhood years to the story in which
the imprisoned handsome prince is released from a
toad’s body by a kiss from the beautiful princess.”)
CUSTOMERS: “Futuredefining 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 doesn’t 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 doesn’t do the
thing he ought to do, and so the expert isn’t
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)
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
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
WE
BECOME WHO
WE HANG
WITH!
Leaders know …
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) don’t 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) Don’t try to learn anything
from people who seem to have solved the problems you face.
(11) Forget the past, particularly your company’s success.
Bob Sutton, Weird Ideas that Work: 11½ Ideas for Promoting,
Managing and Sustaining Innovation
9. Cherish
FAILURES.
The Gales of Creative Destruction
+29M = -44M + 73M
+4M = +4M - 0M
“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
“The secret of fast
progress is
inefficiency, fast and
furious and numerous
failures.”
Kevin Kelly
“Reward
excellent
failures. Punish
mediocre successes.”
Phil Daniels, Sydney exec (and, de facto, Jack)
Sam’s
Secret #1!
“Fail faster.
Succeed
sooner.”
David Kelley/IDEO
“Fail .
Forward.
Fast.”
High Tech CEO, Pennsylvania
Read This!
Whoever
Makes the Most
Mistakes Wins: The
Paradox of Innovation
Richard Farson & Ralph Keyes:
10. Talent II:
The “Check-out
Clerks Test.”
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 Nation
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, mostly—caveat: “they”
don’t engage unless they’re “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-teachersleaders) had never dreamed existed—and 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!
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
“If there is nothing very
special about your work, no
matter how hard you apply
yourself, you won’t get
noticed, and that
increasingly means you
won’t get paid much either.”
Michael Goldhaber, Wired
Brand You, Big Time!
I AM AN
ARMY OF
ONE
11. “A Place
Worth Working
For.”
MantraM3
Talent = Brand
What’s your company’s …
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 Talent
“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. TP’s final words: CYNICISM SUCKS.]
G.H.:
“Create a
‘cause,’ not
a ‘business.’ ”
1.
2.
3.
4.
An “Action Culture.”
Work that Matters: WOW Projects/BHAGS.
Demo Mania.
Web World = ALL: The “Friction-free
Enterprise.
5. “Beautiful” Systems.
6. “Departments” as Heroes: New Bases for
Value Added.
7. Talent: The 25/8/53 Obsession.
8. Automatic Renewal: The “HSDE.”
9. Cherish FAILURES.
10. Talent II: The “Check-out Clerks Test.”
11. Brand Inside: “A Place Worth
Working For.”