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Revive Canada's BlackBerry Limited by DNA of
foreign successful enterprises
Frank Dec. 26, 2015, in
Waterloo, Ontario, Canada
Dec. 18, 2015, the article BlackBerry reports 3rd-quarter loss but tops expectations reports BlackBerry Limited a loss of $89 million in
its fiscal third quarter. BlackBerry shares have dropped 29 per cent since
the beginning of the year. The stock has fallen 22 per cent in the last 12
months.
The report made me disappointed again and immediately think of the
sad experiences from working in different Canadian enterprises, I got a sense
that BlackBerry was rebirth from former Research In Motion - RIM, such a
background would make it still existing the fatal DNA towards decline, since
that BlackBerry was composed of former RIM’s employees that have
accustomed Canadian pop corporate culture – a culture that encourages people to
ask more by doing less and dared boldly make mischief at workplace, even some
management staff dared play atomic bombing with a right for farting, without a
sense that enterprise is the lifeboat in sharing by employer and employees to
struggle for survival.
Such behavior of taking stupid as smart is actually nourished
by absurd values that are legally protected and excessive
self-appreciated under populist democratic polity – a polity encourages
democratic players doing every possible to please voters with expending of
national interest, due to without essential prerequisite for ensuring the
quality of political candidates. If you review the background of those
Government Members, the majority of them, besides full hearted playing tricks
for pleasing voters, barely have basic quality as policy makers needed -
education, knowledge, experiences, and especially, a rational mind for fulfilling their
sacred social governance duties.
Such wrongful corporate culture and social ideology is the fatal
cancer in Canadian society, it will inevitably still dominate BlackBerry in
corporate soul, corporate bone and corporate marrow, and it cannot entirely to
be reborn.
Such ridiculous corporate culture and social ideology will disable
any talented and experienced rational top executive, no matter how successful
they are in other countries.
As an inheritor of RIM – the former flagship business of Canada,
the success of BlackBerry Limited will be not only able to
motivate a lot of upstream and downstream enterprises to form an industrial
cluster, but also it can boost related social services – education, medical
care, and commercial industries……, they are all crucial for developing economy
and thereby to create a livable community.
We urgently need a high efficient prescription for entirely
reviving Blackberry - with the world's best corporate hematopoietic mechanism
and successful corporate DNA to essentially transform the corporate culture of
Blackberry and then by its exemplary role to revive Canadian enterprises
throughout Canada – the Canada where is our home place – the place where our
families are relying on surviving.
While RIM and many world-class companies in declining, a lot of
enterprises are developing against economic recession as powerful world-class
market fighters.
In the same depressed economic and market environment, the failure
or rise of an enterprise, will certainly be due to its intrinsic reasons. Dig
out such lessons will be significant for the successful development of
Blackberry, and for the successful development of Waterloo region.
We should also remember that Waterloo region is the manufacturing
center of Canada.
Then, what is the fatal DNA and wrongful corporate culture that
failed RIM
Jan. 27, 2014, the discussion in my article The Fatal DNA of RIM & Canadian
Enterprises is worth to review in here, this topic, I excerpt
some as follow.
RIM - Research In Motion Limited,
as a successful high-tech enterprises, once was the pride of Canadians. Its
Headquarter is just several blocks away from my home. Now is declined
as BlackBerry Limited.
Recent years, facing new competitors rapid rising, it has
been retreating. The bad news are one after another continuously, the
sales decline, the stock devaluation, downsizing, the arguments of the
privatization or so, every bad news have deeply hurt my nerves.
However, that made me most sad is from a
gossip, that is a second grade pupil said that her parents are
both working in RIM, once, to be laid off together, their
home will no money pay for mortgage, their new house
will be repossessed by bank, She worries nowhere to live?
RIM, the total employee is nearly 20% of the population
of it headquartered city, although that include the staff who works
in the branches of other cities, but big proportion are from locals.
So, its rise or fall will strongly impact the life of local community.
However, for RIM's declining, besides the families of the founder, the families
of their staff, and government officials of Waterloo City, I think that, there
are few people would care about.
Nov. 4, 2013, the article BlackBerry receives investment of US$1
billion from Fairfax Financial and Other Institutional investors reported
that: “John S. Chen to be
appointed as Executive Chair of BlackBerry’s Board of Directors and Interim
CEO."
The report gave me a new hope. Finally,
RIM gets solution to clean up the mess, the farce returns to
serious play.
How did the poison blood and fatal DNA damage the RIM?
It is that stifling intellectual work environment damages RIM.
The one of the important factors in the success of world-class
enterprises is that encourages employees to participate in business management.
The successful enterprises are mainly driven by motivating their
employees fully exerting intelligence.
The failed enterprises are mainly due to that their employees
cannot free exerting their intelligence.
For RIM's decline, people can find many sound reasons,
however, I think that, the most fundamental one is the stifling
intellectual work environment, which is that suppresses the free exertion of
intelligence of the employees without a effective channel for employees
expressing their views freely to have damaged the driving force for
continuously self-revolution, which is essential to fit the market that
increasingly rapid changes.
Such a corporate culture is common in Canadian
enterprises, which is just opposite that of smart doing in German Companies and IBM.
May 28 2012, in my article The DNA of the Success of German Manufacturing, I
indicate that the driven force for German outstanding manufacturing mainly
comes from their government legislated management for rationalization
proposals, which is to extract bonus from the profit gained in the application
of the proposals to motivate all staff to pay their full talent into the
business running since Mr.Krupp initiated it in 1872. That is 142
years ago.
May 28 2012, in my article, The DNA of the Success of IBM & America's best-run
companies, I indicate that the driven force for patent invention of 102 years old IBM has been counting on the top of
those world-class corporate giants in the United States for 20 consecutive
years is the patent-related bonus incentive system. In IBM, for any staff,
published an article, approved a patent, all have
assessment records with regulated cash awards.
However, Canadian companies are just going on the contrary.
Two years ago, I read an article Open letter to BlackBerry bosses: Senior RIM exec tells all
as company crumbles around him that posted in Jun 30, 2011. The
writer is Jonathan S. Geller who is the founder of BGR - the biggest mobile
news destination in the world.
In the article he said that: “We have received an open
letter to Mike and Jim from a high-level RIM employee (whose identity we have
verified), and in an amazingly honest and passionate plea, this letter gives
fascinating insights into what RIM must fix, and fast. RIM did not immediately
respond to a request for comment.”
The start of the open letter and the 8 suggestions as follow:
“To the RIM Senior Management Team:”
“I have lost confidence.”
“While I hide it at work, my passion has been sapped. I know I am
not alone — the sentiment is widespread and it includes people within your own
teams.”
“Mike and Jim, please take the time to really absorb and
digest the content of this letter because it reflects the feeling across a huge
percentage of your employee base. You have many smart employees, many that have
great ideas for the future, but unfortunately the culture at RIM does not allow
us to speak openly without having to worry about the career-limiting effects.”
8 suggestions:
1) Focus on the End User experience.
2) Recruit Senior SW Leaders & enable decision-making.
3) Cut projects to the bone.
4) Developers, not Carriers can now make or break us.
5) Need for serious marketing punch to create end user desire.
6) No Accountability – Canadians are too nice.
7) The press and analysts are pissing you off. Don’t snap. Now is
the time for humility with a dash of paranoia.
8) Democratise. Engage and interact with your employees — please!
The suggestions are not only pointed out the problems,
but also offered workarounds, especially reconstruction of management,
interaction with employees and to be managed in accountability. It shows
the writer's honesty in deep concern for RIM's future, and well
thought out.
Above 8 suggestions were all to hit on the root cause of
the failure of RIM and perfect suitable for any businesses.
From above 8 suggestions, we could afeel that chaotic in the
management.
However, RIM’s responds to open letter was not only
with no thanks, instead, was somewhat hatred condemnation, the first paragraph
is as follow:
“An “Open Letter” to RIM’s senior management was published
anonymously on the web today and it was attributed to an unnamed
person described as a ‘high level employee”. It is obviously difficult to
address anonymous commentary and it is particularly difficult to believe that a
“high level employee” in good standing with the company would choose to
anonymously publish a letter on the web rather than engage their fellow
executives in a constructive manner, but regardless of whether the letter is
real, fake, exaggerated or written with ulterior motivations, it is fair to say
that the senior management team at RIM is nonetheless fully aware of and
aggressively addressing both the company’s challenges and its opportunities.”
This is one of important lethal Gene fragment in RIM and
Canadian enterprises.
A RIM scientist has similar experience of the Open Letter
After reading the open
letters, RIM's responds, the emails of RIM's employees and the readers' comments, I once talked
with a material scientist who is working in the lab of RIM. She said that she
once wrote a suggestions’ letter to the management, but without any
response. She felt that the corporate culture of RIM is not worthy
for appreciation.
Besides above, I once called my friends who were working in RIM at
that time.
The one who works in the service department said that their work
efficiency has a lot of room for improvement.
Obviously, in RIM, it has no normal channels for facilitating the
communication between subordinates and superiors to promote the development
with the wisdoms of all employees.
I call this phenomenon as the obstruction of enterprise, it is the
main cause of RIM's decline, and the main cause of RIM did a dirty
job with the outstanding employee.
A Middle management puts atomic bombs with a right for farting
Followed RIM responds to open letter,
Jul 1, 2011, BGR published More letters to RIM; employees rally
alongside anonymous exec, the writer Jonathan S. Geller said that:
“BGR published an open letter to Research In Motion yesterday.”
“RIM responded. It wasn’t pretty, and it really didn’t address a single point
that was made by the original plea. It wasn’t just RIM that responded, however
— we received dozens of emails from current and former RIM employees detailing
their stories, and essentially all agreeing with the open letter that was
published on BGR.”
Following is the part of an email from a former RIM employee.
“I was an employee at RIM for a year and a half. I worked in the
legal and business affairs departments, and despite having originally thought
I’d landed the jackpot job-wise, it took no time for me to begin planning my
exodus.”
“My first week started with a complete change in my title and
duties without anyone telling me, and when I dared ask what was happening, the
director (my boss) and her BFF the OD business partner ganged up on me and
threatened to let me go, setting the tone for the remainder of my time there.”
“Over a year an a half, the four of us in the same position
dwindled to just me and yet I was responsible for getting all four jobs done
for the better part of a year, since this is how long it took the department to
hire other entry-level people. Two individuals who had less education and
experience (not to mention drive or intelligence) than me were promoted several
times while my boss continued to tell me up and down that I had reached my
ceiling at RIM due to my lack of education (two degrees!) and experience (5
years!)–as an administrative assistant. Rather than attempt to fight this
system I figured I could transfer departments, only the company policy requires
the supervisor to act as a liaison and reference for internal applicants. The insanely
high turnover rate meant the department head wouldn’t let anyone go, in
addition to refusing to promote from within (pets excepted). People were pitted
against each other and an incredibly tense and hostile work environment was
fostered. People around the office started referring to the office politics as
“Survivor: RIM edition.” And we all remember the great movement to make
recycling physically impossible across the entire company because one person
let some confidential information slip.”
“Then, as I was saving up to return to school and make a better
life for myself, I received a series of nasty emails from HR letting me know
that since my boss had failed to log my vacation time a year earlier on SAP
(despite my insistence on her doing it at three different times), I would have
two full pay cheques deducted to “pay back” the company for what was being
portrayed as my mistake. I never received an apology and almost had to drop out
of school due to the loss of a full month’s pay. On my last day my boss
deliberately avoided me at all cost. The best part is that I recently heard
that my boss just got promoted to the VP of the business affairs department.”
The intellectual fruits are often seized by others
I am eager to explore the management reason of the failure of RIM
with any possibility, especially, I would eagerly ask related questions as long
as meet the people who once worked in RIM.
In around 16:10 June 26, 2014, I discussed the such issue of
RIM with an art profession specialist who once worked in RIM for many years and
now working as a general operator in the production line of the foods
processing – DC Foods Waterloo.
She said that there was also the management for the
rationalization proposals in former RIM. However, the fruits of the achievements
of the rationalization proposals were seized by the management staff, so the
technical personnel of the main body for the rationalization proposals stopped
their effort on any proposals.
She also said that, in former RIM there were also comprehensive
regulations as that of other well managed world class companies, but, the
regulations cannot function effectively, due to that managements play with own
preferred accord with ignoring the regulations.
As my experiences from working in many different businesses,
compared with foreign one, in Canadian businesses, for most management staff of
locals, there are no sense for that what is the regulation, even, no sense of
what is law?
Then, what is high efficient prescription for entirely rebirth of
the Blackberry.
ZTE Corporation is a China’s multinational telecommunications
equipment and systems company founded in 1985
and head-quartered in Shenzhen, China in
three business units - Carrier
Networks(54%)-Terminals(29%)-Telecommunication(17%). ZTE is one of the top five
largest smart phone manufacturers in its home market, and in the top ten,
worldwide.
From China's ZTE Corporation's products and 30 years of successful
development, I can not help but think of Canada's former RIM that was in
similar field and found in 1984. While China's one is growing up, Canada's one
was downsized as Blackberry Ltd.
What is the causes of such a different consequence.
April 30, 2015, China Central Television - CCTV reports the
management innovation in ZTE, I think there is significant reference
meaning to Blackberry – the former RIM, so I especially excerpts translated
some significant episode as follows.
There are 107 branches at home and abroad and 8% of 70,000
employees is in administration. There 17 are senior management with average age
of 47 years old.
The biggest problem of Enterprise is the barriers for well
cooperation between departments, and the slow in decision-making. ZTE decided
to carry out corporate management reform to quickly adapt to market changes.
However, after 30 years of development, a lot of running pattern
has been formed and all staff have used to it with seeing it is as norms. The
habit is not easy to change. For management reform, the most difficult is to
find out the problems. Who would like to do such a things that is doomed to
offend massive others.
The video immediately shows that, in every quarter, the management
consulting guru in ranking first in the world Mr. Ram Charan comes to ZTE for
carrying out advisory activities.
For ZTE executives, every time meet with Ram Charan, are all
feeling as facing a major surgery, because that Ram Charan will make operation
for a management problem. This time, he will solve the thorniest problem for
any businesses – dealing with management personnel.
Ram Charan said that, we should focus on the issues of management
staff in key areas, the project management. The project management is a kind of
way of life, because we create new products, new research to cover new markets.
It is looking for the project and to be implemented into improvement of
company's efficiency. At this point, ZTE has made good progress. Of
course, there is still great room for improvement.
Video also mentioned that open declared remuneration of Mr. Ram
Charan is $ 20,000 hourly (I think he will spend a lot of time for preparation,
if we take this into account, the average hourly paid rate will be much less).
Senior vice president in responsible for enterprise architecture,
Chen Jianzhou who firstly suggested to invite Ram Charan, due to that he
analyzed many historical situation of multinational companies’ transformation,
to have realized that the transformation is not easy; the success rate is not
high. In order to promote the company transformation smoothly and quickly, he
believe that company needs external professional talent.
Mr. Ram Charan emphasizes that insight into customer, the user's
behavior, what is users’ like and how can be outstanding in competition? Such
things are the most important.
He said that great enterprises have a common characteristic, it is
that they can continuously capture external changes, and to make adjustment
according to external changes, China has entered the global market, the China’s
government, is creating better operating conditions, which will be given more
freedom, and to bring more competition, companies must adapt to the new
competition rules, that is huge challenge for companies’ transformation.
Regarding dealing with personnel issues, whether the executives
are competent? He tests by requesting senior executives to study the financial
statement of company. A qualified executive must be able to identify problems
through the financial data. He often makes spot checks through private conversations.
It was a window that Ran Charan tests the health level of the enterprise.
In first day first time Mr. Ram Charan came to ZTE, he casually
asked executives some operating data that must be skillful memorized, but, few
of them can answer, to have made an awkward scene.
In the discussion of some specific project, some people mentioned
that he needs the support from other department. He unceremoniously interrupted
the speaker: which department? Who is needed? What is to do for you? And how
long time to complete?
Repeatedly as this, he often made senior executives embarrassed,
but, he still sticks to his stand, because he is toward problem, not toward any
individual.
ZTE chairman said that: large enterprise has disease of large
enterprise, treated, recovered, but, will get new kind disease again, thus
endless. The large enterprise with more resources makes it more competitive.
However, precisely say, because that people are more and the resources are
more, so that flexibly mobilize them is not easy. Each team has its own
calculator for own selfish interest thinking: if I help you, you create a
performance, and then, where is my performance? This naturally and inevitably
occurred mode of thinking in large enterprise would certainly cause the
difficulty for scheduling and integrating the resources.
Like a community, large enterprise has unspoken rules also to be
obeyed by employees. The procrastination in work, unclear in responsibilities
and rights, such problems are badly affect the systematic efficiency, even kill
a good business. The causes are known very well by everyone, but, there no one
is like to put them on the table. This is crowd psychology that will occur when
people grouping in regardless with race and nationality. This is the thorniest
problem in corporate management. Such thorny problems are turned out one by one
when discussion with Ram Charan. And they are solved by divided into projects
of human resources, cost control, performance breakthroughs and so on.
In order to solve the problem of corporate strategic objective to
be decentralized, Ram Charan recommended ZTE to adopt mechanism of president of
the joint meeting.
At the start of every year, the executives elected 5 projects to
focus on promoting in this year, and around five goals, to make clear the tasks
for various departments, to set agreements for across sectors cooperation, to
be promoted by responsible person replies regularly to ensure that the
company's goals are clear from top to bottom and is able to be concerted in
action.
In original conference room, the comfortable sofa chairs were
moved out, the decoration on the walls has also been replaced by whiteboard
that can be casually scribbling. Every Tuesday, in this room, the top
executives hold regular meeting. In order to achieve the objectives of the
meeting efficiently, the participants have to standing.
The assistant to the president, Dai Peng said that: when discussion
of some specific project, the executives that related with the project is all
in the conference room to make decisions on-site. When project encounters
problem, there is no one shuffling or complaining, but, putting forward how to
help each other solve the problems. Such process is very simple, but, very
effective. Since the program of president of the joint meeting launched in last
November, the efficiency of meeting and the flow process of the project
development, etc., from a statistical point of view, are accelerated and more
efficient.
Above is the flow charts of project scheduling in ZTE Research
Institute that located in Xi'an City China. The Mandarin titles that can see
clear are: waits for developing, in developing, waits for verifying, in
verifying, had delivered, and in obstruction......
In Xi'an Research Institute, every day holds morning meeting.
Everyone's working process and the target of the day are all posted into the
flow charts. For any delay, the project leader must be clear at first time and
have to propose a solution. It is said that this method can increase the
efficiency of R & D by 50%.
The president of the Research Institute was asking a researcher:
why was delayed? This is a voice-based technology. The researcher replied that
he needs a special meter.
For such a harsh working way, the president told reporter that:
there is no way; the lead times for Internet companies are shorter and shorter.
For example, in the last year, the lead time was one year; this year is six
months, and next year, may be only three months. He continued with that,
originally, our field of industry was easily to earn good money, but, now, it
is more and more difficult. The reason is that the Internet with other
industries integrated closer and closer. We have to make some quick changes, so
that our products’ adaptability can be much wider.
In ZTE Shenzhen headquarter, it was 21 pm, still there is commuter
bus to send overtime employee home.
In order to save time, even, there are employees to sleep in the
office.
After the help of Mr. Ram Charan, we can see the reviving of ZTE -
from top level or may say that is also from root level, by a easy way, to have
avoided the fatal disease of the large enterprise – low efficiency -
procrastination in work, the barriers in cooperation between departments, and
unclear in responsibilities and rights……
The reason analysis for the success of Mr. Ram Charan.
1…A China’s saying goes; the monk from far distance is easy for
chanting. The unique advantage of Ram Charan is as temporary consultant outside
of company without the fear of breaking the friendship with others.
Nov. 4, 2013, Family Business and Management Board,
I have said that, within the business, because of the members are familiar each
other with friendship, even kinship, so that it is difficult to deal
impartially with some problems that happened in business operation due to the
worry of harming friendship or losing friends. In particular, the embarrass
that produced when pointing out the shortcomings in face to face. By
establishing the Management Board and collectively make decision in document
form, that some thorny problems may much easily be handled.
To hire some professional people outside of the family to
establish a management board has unique advantage, because of those new comers
have no former relations in vital interest with those original employees, they
will be able to relieve or resolve down the conflict that may originally exist
between the employees and bosses. Such conflicts are hardly to handle. The harm
for the enterprise is fatal.
2…As a world-renowned management consultant, the outstanding
personal prestige will help him to reduce unnecessary trouble in work.
The
success of many international well-known large enterprises has the decisive
contribution of Ram Charan.
I
searched some information about Dr. Ram Charan.
Dr.
Charan runs his business management consulting company under the name Charan
Associates located in Dallas, TX. Records show the company was established in
1981 and incorporated in Texas. Charan sits on the board for Austin
Industries, SSA
& Company (formerly Six Sigma Academy), and TE
Connectivity.
Dr.
Ram Charan has published 19 best-selling books in management.
As
the world's most prestigious management consultant, the views of Dr. Ram Charan
have a strong practical operational advantage. Moreover, he has strong
foundation in the area of profit growth, leadership, social systems reform,
corporate governance, global matrix organization, innovation, etc..
His
every book has attracting enormous attention and sensation in the global
business community, especially the EXECUTION - The Discipline of Getting Things
Done, and the EVERY BUSINESS IS A GROWTH BUSINESS - How Your Company Can
Prosper Year After Year. He received his MBA and DBA degrees from Harvard
Business School.
Over
the past 40 years, Dr. Ram Charan has been working as executive consultant for
dozens of Fortune 500 companies, such as General Electric, DuPont, Ford, Bank
of America, and Intel……
He
was Jack ? Welch most respected Advisory master.
Jack
Welch respected Dr. Ram Charan as that: "He has a rare ability to extract
meaning from meaningless things, and in a calm and effective manner to affect
others."
When
Jeff ? Immelt took over the position of Jack ? Welch, Dr. Ram Charan was the
counsel of his first outward for advising. In 2007, it was 37 years of Dr.
Charan working for General Electric Company, and 33 years working for the
DuPont.
“Head
in, hands on”: Ram Charan on How to Lead Now
Christina Bielaszka-DuVernay FEBRUARY 11,
2009
https://hbr.org/2009/02/ram-charan-interview
Renowned
business adviser Ram Charan’s latest book is Leadership in the Era of Economic Uncertainty: The New Rules
for Getting the Right Things Done in Difficult Times (McGraw-Hill,
2008). He recently spoke with Christina Bielaszka-DuVernay, a
HarvardBusiness.org editor, about the challenges — and opportunities — this
downturn presents to companies and their leaders. In this edited record of
their conversation, Charan gives leaders at all levels advice on guiding their
organizations and people through this crisis and coming out stronger on the
other side.
CBD:
What’s most important for leaders — not just CEOs and senior executives but
leaders throughout the ranks — to focus on right now?
RC:
In these times more than other times, first and foremost is demonstrating
personal integrity and maintaining your personal credibility. They are so
important in tough times, yet many leaders lose their integrity and destroy
their credibility by giving into the temptation to cut corners when they have
to do unpleasant tasks like downsizing. For example, a business-unit head,
instead of being transparent about why he needs to cut 10 jobs, gives a partial
truth or makes an excuse. That’s a way of cutting corners, and it’s
destructive. In the Google era, people will find out the truth
and that leader will lose credibility, making his job even more difficult.
Tell
people the truth. Gather information — from customers, from your customer-facing
employees, from sources outside the firm. Talk to employees throughout the
company; listen to their viewpoints and engage them. When you have a firm
picture of reality, share it. Tell people the reality — if the company doesn’t
take action now and cut some jobs, even more good people will lose jobs later.
In this environment, the entire company could fail as a result of a leader
failing to make hard decisions when they’re needed.
If
you have to make layoffs, make them in a fair, open way. Be frank; explain
what’s happening on the outside and why layoffs are necessary to protect good
people and good jobs.
Authenticity
is always important but now it’s absolutely critical. Leaders, wherever they
sit in the organization, have to demonstrate rock-solid integrity, honesty, and
the ability to confront reality. The way to inspire courage and optimism in
your employees is by mapping a credible path forward. If you soft-pedal bad
news, they won’t trust you. Worse, they’ll miss the urgency of the situation and
won’t follow you.
In
your book you advise leaders to practice “management intensity.” What is this
and why is it so important now?
I
define management intensity as a deep immersion in the business’s
operational details and the day-to-day competitive climate the business is
facing, along with hands-on involvement and follow-through.
It’s
so important now because of the accelerating speed at which things are
changing. Surviving a volatile environment requires frequent operational
adjustments. You hear every day about new layoffs and downward projections.
Keeping up with news like that and tracking its effects is crucial, because a
cut today will initiate cuts elsewhere tomorrow. It’s not enough to sit in your
office and read reports and issue directives. You’ve got to know what’s
happening daily, and adjust plans and processes accordingly.
Big-picture
strategic thinking is still important, but it must take a back seat to this
operational immersion — leaders need to be involved and visible, and
communicating all the time. As I explain in the book, your guiding principle
should be this: Head in, hands on. Only in this way will you be able to
anticipate what’s coming next and respond quickly and appropriately.
Does
management intensity place a greater emphasis on execution than what’s called
for in more flush times?
Yes
— management intensity calls for a sharper and more frequent focus on
execution. The DuPont story I tell in my book is a good
example of what I mean. When Chad Holliday [then DuPont’s CEO; now its
chairman] determined that the global banking crisis had spread beyond the
financial sector and could seriously affect his company, he called a meeting of
DuPont’s crisis teams. Over four days, they put together a plan to deal with
the growing economic downturn. Conserving cash was the top priority.
Within
two weeks, every one of DuPont’s 60,000 employees had had a face-to-face
meeting with a manager who explained the plan for keeping DuPont viable. Each
employee was asked to name three things he could do immediately to save money
and conserve cash. Then a few days later, the company polled employees to
assess their understanding of the crisis, their psychological response to it,
and their follow-through on conserving cash.
After
this first round of communication with DuPont employees, you report in your
book, Holliday had the sense that people hadn’t grasped the urgency of the
situation. You quote him as saying that “maybe we were too good at giving
[employees] the reassurance and confidence that we could come through this.”
What balance should leaders strike right now between realism and optimism?
Realism
is not negotiable. It’s absolutely essential to anyone who leads. You need to
have a clear picture of how bad things are and how bad things could get, then
put that reality in front of people.
Realism
also includes determining under what conditions the business will improve, and
communicating those scenarios. That’s optimism grounded in solid realism.
People
through the centuries have gone through some very difficult times. Those who
succeeded despite challenging conditions did so because they were tough and
tenacious. You have tough and tenacious people working for you; engage them by
putting the hard issues right in front of them. They will be motivated to
overcome the challenges.
Isn’t
there a danger that people will become demoralized by the enormity of the
challenges? How does a leader prevent that from happening?
Give
them the problems in bite sizes. Put a challenge in front of them that’s
specific and concrete enough to deal with. For instance, if your competitor has
a 20% win ratio, challenge them to get 30%. Even though the total market is
declining, even though your company’s revenues will be smaller, you and your
employees still have a chance to compete and to beat somebody.
These
are anxious times. How should leaders manage their own emotions?
Actually,
in a crisis most leaders tend to be too optimistic rather than the contrary.
They overestimate how well their company will fare because they want to believe
everything will turn out well. This misplaced optimism allows them to think
that they don’t have to make painful decisions or take drastic action.
To
guard against this, I advise all leaders to map out worst-case scenarios. If
you deliberately plan for the worst, you’ll probably encounter something less
dire and come out ahead when it’s all over.
In
your book you say that surviving this downturn requires intense coordination
across the company. What can the CEO do to pull down silos and foster
companywide coordination? What can midlevel leaders do?
Any
leader at any level can figure out what key decisions must be made and what
coordination is required to implement them. Say your unit aims to launch a new
product by July. You know what decisions you will have to make around that
goal. So move swiftly to get the best information you can, then make the best
decisions you can.
You
know there will be three or four silos involved. Check in with people from
those areas frequently, asking questions and exploring issues with an open,
informal tone. Remind them of your shared purpose: to win with customers. Human
beings like to win, and in companies, no one wins alone.
It
might help to think that the situation you and your colleagues face is akin to
a basketball game. Players make judgments constantly about the game as it’s in
progress, instinctively passing the ball to a teammate to counter the defense,
without worrying about who’s going to get the credit. Basketball is a sport of
speed, flexibility, and synchronization. The same qualities are demanded of
cross-functional teams in this recession. What department or function teammates
come from doesn’t matter; what matters is that they’re united against the
competition.
You
teach a class at Wharton for high potentials. What’s your
advice to high potentials in this downturn?
If
you’re a high potential, act like one and keep building your capabilities; this
recession doesn’t have to slow you down. In fact, it offers you opportunities
that normal times don’t. Wherever you work, it’s likely that there is a
shortage of really talented, motivated people with the flexibility and
resilience to weather these tough times. So step forward and get noticed. Get
on cross-functional teams. Learn and lead. Build social networks. Set
benchmarks for yourself — use the next two years to double your capacity and
triple your capabilities.
What
will the best companies do during this recession?
They’ll
get ahead the curve and conserve their cash. They’ll take out frills and focus on
the core. And then they’ll think of how the market will have changed in two or
three years and what innovation they will need to have done to compete
successfully, and they’ll do that innovation now.
The
strange existence of Ram Charan
What
he does is hard to describe. But the most powerful CEOs love it enough to keep
him on the road 24/7 and make him the most influential consultant alive.
Fortune's David Whitford reports.
David
Whitford, Fortune writer April 24 2007: 9:12 AM EDT
http://archive.fortune.com/magazines/fortune/fortune_archive/2007/04/30/8405482/index.htm
(Fortune
Magazine) -- The Al Manzil Hotel in Dubai has been open for business all of 18
days on the Saturday night in January that I show up with Ram Charan. The lobby
is strangely quiet; there doesn't seem to be anybody else staying here. The
surrounding neighborhood is called Old Town, but in fact it's a construction
site from which are rising what will one day be the world's tallest skyscraper
and the world's biggest mall. Soulless and kind of creepy, I'm thinking, but
Charan's thoughts are elsewhere.
Already
he has claimed an overstuffed chair in the center of the lobby and is talking
on the phone. After 12 hours of isolation on the flight from J.F.K., Charan is
back in business, deep in private conversation with a client in New York City.
He looks tired, and no wonder. He began his day with a 4 A.M. Friday wake-up
call in Richmond (he did a Squawk Box live remote on CNBC), and he has a head
cold. But he is in no hurry to go to bed. Charan doesn't care what time it is.
He doesn't care what day of the week it is. And the last thing he cares about
is where he is. As long as Charan is with a client - or can get one on the
phone - he's home.
Thirty
years ago this month, Ram Charan (pronounced "Rahm Scha-RON") quit a
tenured professorship at Boston University to devote himself full-time to
consulting. Today he's alone at the top of his profession - not a consultant so
much as a guru, a corporate sage, with unparalleled access to boardrooms across
the globe and intimate, enduring relationships with an array of powerful CEOs.
Among
them: Jack Welch, formerly of GE (Charts,Fortune 500), who says of Charan, "He has
this rare ability to distill meaningful from meaningless and transfer it to
others in a quiet, effective way without destroying confidences"; Dick
Harrington ofThomson Corp. (Charts) ("He probably knows more about
corporate America than anybody"); andVerizon's (Charts, Fortune 500) Ivan Seidenberg ("I love him.
He's my secret weapon"). "He's like your conscience," says
former Citicorp CEO John Reed. "Just when you sort of think you have
everything done and you're feeling pretty good about yourself, he calls you up
and says, 'Hey, Reed, did you do this and that and the other?'"
Fortune 500: See the full list
There's
another aspect of Charan, not unrelated to his success, that sets him apart
from his peers, if not the whole human race: what Jack Krol calls Charan's
"strange existence." "When I was chairman and CEO of
DuPont," says Krol, "he'd show up at the house Sunday morning at
nine, and we might spend three or four hours, and all of a sudden he'd
disappear. He would go anywhere at any time that you asked him to meet with
you. Business is his whole life."
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