“When Character Was King”
By Peggy Noonan
Penguin Books, 2001
Understandably, most people of this country struggle over one question: Who should be the next President of this not-so-strong Republic? The choices, until recently, were among the incumbent President who is rating low, a former Senator and Education Secretary who is concededly intelligent and seasoned on the political stage, and a Senator whose reputation, however, is stuck with his tour duty as a controversial chief of the national police.
All three have great issues attached to their aspirations: experience for the incumbent, education for the former Secretary, and peace and order for the top policeman. Is that all?
One doesn’t think so. An aspirant to the vice presidency, Senator Loren Legarda, after noting that aspirants can casually and conveniently address issues that endear themselves to the electorate, reduced the choice to one fundamental: the candidate’s character. The ultimate test is the character of the individual – his or her integrity, courage and demonstrated capability to do what is right, not what is expedient or popular.
What about competence, educational attainment, and preparedness for the job? These points have assumed larger significance with the entry of one of the most popular action stars joining the political fray – and some people were advancing arguments that were used to elect a former President who ended up in jail; the same argument that tries to establish affinity with the election of Arnold Schwarzenegger and, in the early eighties, the assumption to the U.S. Presidency of Ronald Reagan.
Our view of Ronald Reagan was too simplistic compared to the many-sided personality of this Great Communicator. The book, “When Character Was King,” a story of Reagan by one of his finest speech writers, reveals a lot about this highly successful and much-loved President the Americans ever had.
He controlled inflation, perked up the American economy, raised individual incomes, reduced taxes, and made the U.S. the pre-eminent player in the geo-political war where the antagonist, Soviet Russia, turned out to be a non-power at all.
What began the making of Reagan the communicative leader? Noonan is insightful: “As president of the Screen Actors Guild, Reagan learned how to negotiate, play tough and get tough, how to feint, stall and vamp for time, how to wait them out, how to smoke out the real reason for an impasse. He learned that it was not personal, it’s business. It’s politics.”
Reagan was generally a nice guy. One time, he lost his temper because his reserved room was given to someone else. He berated the man, was rude and impatient – and he left. Asked if the counter person saw Reagan again: “Oh sure, the next morning when he came to apologize.”
Soon enough, Reagan has perfected his way with words, and dished out his version of reality masterfully. On switching parties – from Democrat to Republican, Reagan said: “We didn’t change… they changed.”
From actor, Reagan increasingly was involved in talking about governance, about issues that citizens wanted to hear – from his denunciations of big government to criticisms of a heavy tax burden. As related by Noonan, the turning point of Reagan’s life was when he spoke for half an hour on NBC. That was the moment. Noonan says: “He stepped into national politics, became a presence in the nation’s political life. He stepped into history.”
He was fifty four when he ran for governor. The opponent, Pat Brown, dismissed Reagan as an actor, and implied “he was a phony, mouthing words as an actor does from a script he hasn’t written.” But Reagan was a good writer, had ear for music and employed cadence in his written and spoken words – in plays and his stories. As history would have it, Reagan won by a landslide over Brown.
After the governorship, the Presidency was not far behind. After the primaries, the Republican bet had to face the Democratic incumbent: Jimmy Carter. The high point of his campaign was at the “Reagan-Carter Debate” in 1980 when Reagan took command of television, and left these words ringing: “Are you better off now than you were four years ago?”
In a book that is full of insights about the man in private and the President in public, author Noonan observes: “Nothing internal, within him, changed. His character seemed to be an unbroken line that didn’t waver or soar too high or low. He was not given to conceit, didn’t play with people when he had the chance, didn’t show up places late because he’s the most important and interesting man invited, so the fun will have to start when he gets there.”
Reagan’s dealing with issues at home and abroad has been characterized by candor and devotion to truth, according to the author. Noonan says: “He loved the truth… He thought the truth is the only foundation on which can be built something strong and good and lasting – because only truth endures. Lies die. He wanted to crowd out the false with the true.”
When politicians in the past sidestepped the issue of attacking the Soviet Union, Reagan called it the “The Evil Empire.” In one speech, he told Soviet Union Secretary General Mikhail Gorbachev, “Tear down this wall!” referring to the Berlin Wall.
The author adds an insight: “He didn’t know how very soon the wall would fall, and literally a six-ton piece of it would be shipped to America to be installed at the Reagan Library.”
To many of us engrossed in comparisons and in our search for parallels, Reagan’s portrait can be used and misused by candidates. Surely, many of these aspirants pale in comparison with this President who happens to have been a university graduate, has ample gray matter between his ears, has the skills of a master negotiator, the courage to do what is right – and one who has found the truth as the best weapon to craft great policies, take resolute action, and gain victory.
Sunday, December 21, 2003
Sunday, December 07, 2003
Survive the dangers of leading
“Leadership on the Line”
By Ronald A. Heifetz & Marty Linsky
Harvard Business School Press, 2002
In a lunch with former Senate President Jovito Salonga, a friend made an obvious comment that “politics is dirty.” The venerable leader took a pause from taking his lunch and said: “You know, politics can be a noble calling.” And he narrated to us what obsessed him to run for political office – to achieve real freedom for the country – and to secure justice. His role in leading the Senate “that said No!” to the American military bases was one of the goals that gave him passion and intensity.
But there are risks involved in leadership. Senator Salonga almost did not survive the Plaza Miranda bombing. Still, this calling called leadership continues to beckon, and young and old, men and women respond, ignoring the dangers. This book is for such leaders – so they can master – if not survive – the perils of leading.
In politics, in the business world and in civil society circles – the same question resounds: Shall one take a leadership role, leave the peace and quiet of a low-profile job, and place your “leadership on the line”? It is actually putting your head on the chopping black, if you please pardon the shocking metaphor.
That is the title of this book, authored by professors of the Center for Public Leadership of the John F. Kennedy School of Government – where a number of our leaders had some training – with visible or invisible benefits!
The authors, showing intimate familiarity with the multifarious hazards of leaders, put it squarely: “To lead is to live dangerously …when you lead people through difficult change, you challenge what people hold dear – their daily habits, tools, loyalties and ways of thinking – with nothing more to offer perhaps than a possibility.”
And yet even if the dangers abound, some leaders – like Finance Secretary Jose Isidro Camacho – chose to leave the ordered life of a highly successful investment banker and join the “snake pit” in the Palace. The book says that there are indeed those who are driven by a genuine desire to serve.
The first part of the book does not mince words about the dangers. The authors warn: “When exercising leadership, you risk getting marginalized, diverted, attacked, or seduced. When people resist adaptive work, their goal is to shoot down those who exercise leadership in order to preserve what they have.”
If you are a leader, you can identify with many of the hazards of leadership – from being placed in a freezer to being led to lose focus; from being attacked (verbally -- and even physically) to being seduced to take up a cause for its fleeting appeal.
After amply warning the reader about land mines and traps along the way, the authors discuss at length the suitable responses to the dangers – or challenges. One of the more useful advice is to “get on the balcony.” The book explains:
“Any military officer knows the importance of maintaining the capacity for reflection, even in the ‘fog of war’. Great athletes can at once play the game and observe it as a whole – as Walt Whitman described it, ‘being both in and out of the game.’ … We call this skill ‘getting off the dance floor and going to the balcony… We all get swept into action when it becomes intense or personal and we need most to pause.”
The book is also instructive to people who, when a business plan has been written, look at it as one “cast in granite.” “Leadership is an improvisational art,” the book says. And it goes on to narrate the story of General Dwight Eisenhower.
After leading the successful D-Day invasion on the beaches of Normandy, the first thing former American President Eisenhower did was “to throw out the plan.” The authors enshrine two leadership qualities: discipline and flexibility. You take action, step back and assess the results of the action, reassess the plan, then go to the dance floor and make the next move.
“Think politically,” is another valuable advice, not for the practitioners of the art – the politicians – but for business executives who are so focused on results that they forget the need to have some political savvy. Many sad and happy stories are documented in the book.
More strategies -- orchestrating the conflict and letting the issue -- ripen will serve the leader in good stead after he places himself on the line. On anchoring yourself, the book tells the engaging story of two good looking American presidential aspirants – one lost, the other won.
The press accused both Gary Hart and Bill Clinton of philandering. They responded in very different ways. Hart counterattacked and got defensive. Bill Clinton took a very different road. He went on 60 Minutes right after the Super Bowl, sat before the cameras holding hands with his wife, and essentially admitted that he had strayed. Hart responded personally; Clinton, strategically and more honestly.
The book’s aphorism is packed with meaning: “Your management of an attack, more than the substance of the accusation, determines your fate.” The perils of leadership are like landmines in a political landscape. This book shows you how to gingerly – and confidently – side step or master the terrain.
By Ronald A. Heifetz & Marty Linsky
Harvard Business School Press, 2002
In a lunch with former Senate President Jovito Salonga, a friend made an obvious comment that “politics is dirty.” The venerable leader took a pause from taking his lunch and said: “You know, politics can be a noble calling.” And he narrated to us what obsessed him to run for political office – to achieve real freedom for the country – and to secure justice. His role in leading the Senate “that said No!” to the American military bases was one of the goals that gave him passion and intensity.
But there are risks involved in leadership. Senator Salonga almost did not survive the Plaza Miranda bombing. Still, this calling called leadership continues to beckon, and young and old, men and women respond, ignoring the dangers. This book is for such leaders – so they can master – if not survive – the perils of leading.
In politics, in the business world and in civil society circles – the same question resounds: Shall one take a leadership role, leave the peace and quiet of a low-profile job, and place your “leadership on the line”? It is actually putting your head on the chopping black, if you please pardon the shocking metaphor.
That is the title of this book, authored by professors of the Center for Public Leadership of the John F. Kennedy School of Government – where a number of our leaders had some training – with visible or invisible benefits!
The authors, showing intimate familiarity with the multifarious hazards of leaders, put it squarely: “To lead is to live dangerously …when you lead people through difficult change, you challenge what people hold dear – their daily habits, tools, loyalties and ways of thinking – with nothing more to offer perhaps than a possibility.”
And yet even if the dangers abound, some leaders – like Finance Secretary Jose Isidro Camacho – chose to leave the ordered life of a highly successful investment banker and join the “snake pit” in the Palace. The book says that there are indeed those who are driven by a genuine desire to serve.
The first part of the book does not mince words about the dangers. The authors warn: “When exercising leadership, you risk getting marginalized, diverted, attacked, or seduced. When people resist adaptive work, their goal is to shoot down those who exercise leadership in order to preserve what they have.”
If you are a leader, you can identify with many of the hazards of leadership – from being placed in a freezer to being led to lose focus; from being attacked (verbally -- and even physically) to being seduced to take up a cause for its fleeting appeal.
After amply warning the reader about land mines and traps along the way, the authors discuss at length the suitable responses to the dangers – or challenges. One of the more useful advice is to “get on the balcony.” The book explains:
“Any military officer knows the importance of maintaining the capacity for reflection, even in the ‘fog of war’. Great athletes can at once play the game and observe it as a whole – as Walt Whitman described it, ‘being both in and out of the game.’ … We call this skill ‘getting off the dance floor and going to the balcony… We all get swept into action when it becomes intense or personal and we need most to pause.”
The book is also instructive to people who, when a business plan has been written, look at it as one “cast in granite.” “Leadership is an improvisational art,” the book says. And it goes on to narrate the story of General Dwight Eisenhower.
After leading the successful D-Day invasion on the beaches of Normandy, the first thing former American President Eisenhower did was “to throw out the plan.” The authors enshrine two leadership qualities: discipline and flexibility. You take action, step back and assess the results of the action, reassess the plan, then go to the dance floor and make the next move.
“Think politically,” is another valuable advice, not for the practitioners of the art – the politicians – but for business executives who are so focused on results that they forget the need to have some political savvy. Many sad and happy stories are documented in the book.
More strategies -- orchestrating the conflict and letting the issue -- ripen will serve the leader in good stead after he places himself on the line. On anchoring yourself, the book tells the engaging story of two good looking American presidential aspirants – one lost, the other won.
The press accused both Gary Hart and Bill Clinton of philandering. They responded in very different ways. Hart counterattacked and got defensive. Bill Clinton took a very different road. He went on 60 Minutes right after the Super Bowl, sat before the cameras holding hands with his wife, and essentially admitted that he had strayed. Hart responded personally; Clinton, strategically and more honestly.
The book’s aphorism is packed with meaning: “Your management of an attack, more than the substance of the accusation, determines your fate.” The perils of leadership are like landmines in a political landscape. This book shows you how to gingerly – and confidently – side step or master the terrain.
Sunday, November 09, 2003
Change accounting rules to match new ball game
“Rethinking the Rules of Financial Accounting”
By Robert N. Anthony
McGraw Hill, 2004
You walk down the streets of the country’s financial district, Ayala Avenue, and you would note impressive high rise buildings. The same is true when – immobilized by the intractable traffic re-routing within the Ortigas Center – you are awed by rows and rows of edifices challenging the heights.
And you wonder: Are the companies which own or have naming rights to these buildings really viable. But, you quickly remember an old adage not to “judge the book by its cover” (or a recent one from the sister of a lovelorn mayor: “Don’t judge him; he is not a book”).
So, speaking of buildings, don’t judge a company by its façade or its giant signboard. After all, there is always “a small company with a big sign” in every square meter of Ayala, Ortigas, Alabang and Filinvest business districts.
So, if facades won’t do it, how do you know the company you are talking to or investing in is well worth its image? Thank God, there are accountants who make sure you can see the innards of the company – with its balance sheet of assets, liabilities and equity. In the past, we could truly say we trust the financial statement as a sacrosanct document, its integrity beyond question. And, so we always said: “Look at the figures.”
And yet after the debacle of Enron (which initially impressed me when top Enron executives Ken Lay and Rebecca Mark flew into town by private jet some years ago) and after the wholesale accounting fraud by WorldCom, the sacred balance sheet has fallen out of grace. Not only that. With the advent of companies whose assets are not, strictly speaking, “physical,” how can one now reduce these assets to pesos and centavos?
Thus, you have “creative accounting” on one side where you need new investigative tools to spot any shenanigan, and you have hi-tech firms whose assets while purely intangible are inestimably valuable. This backdrop encouraged accounting guru Robert Anthony to write the book, “Rethinking the Rules of Financial Accounting.”
Anthony lays his premises well, drawing from the rigors of sciences. He points out: “Most disciplines – physics, chemistry, economics, medicine, engineering, and mathematics – have a conceptual framework for reporting measurements and a set of rules consistent with that framework. Those frameworks and rules have to be examined from time to time as the world changes. Inconsistencies in the rules creep in over time, and the rules do not incorporate new measurement techniques.”
This book is meant for accountants, with technical terms that may be abstruse to the layperson. But, if you are an executive, who went through Accounting for Non-Accountants or have gone through the rigors of MBA training, the fundamental issues raised by the book yield to some, if not easy, understanding.
Thus Anthony begins with a basic truth, “Accounting rules are rules for measurement” – and proceeds to define measurement as ‘the process of associating numbers with physical quantities and phenomena.’ Financial accounting rules measure ‘physical quantities’ in three categories – assets, liabilities and equity – at one moment in time.”
Arriving at a company’s net worth or true value is the crux of the problem confronted by the author. And yet, at the end of every chapter or section, he wrestles with the same old question: How do you reduce to numbers the operating performance of the company – and then how do you “photograph” its financial condition in a balance sheet?
The author begins with the first hurdle: terminology. He points out that even the Federal Accounting Advisory Board of the U.S. showed in a 1998 study that companies have two names for the same item. “Operating income” was used 356 times and “operating profit” was used 146 times.
He moves on to discuss the “Financial Position Statement.” After he volunteers a historical tidbit that the balance sheet has already been used for 500 years, he makes a shocking statement: The balance sheet “does not report an entity’s financial position.”
He explains: “The asset side does not, and cannot, report all the resources that an entity owns or controls.” He cites as examples the value of brands, new products, and the quality of a firm’s management. He also notes the increasing importance of these “intangibles” as knowledge-based assets.
An interesting “did-you-know” info tip is in this book. Accounting’s “dual aspect concept,” according to Anthony, was first used in Italy in the early 15th century by Luca Pacioli’s Summa (1494) who stated that accounting should measure two equal aspects of every transaction. He labeled one aspect “debit” and the other “credit”. It was widely used by companies sending a fleet of ships at the end of the voyage.
In more chapters covering statements on income and cash flow, Anthony argues for the use of the same terminology, no-nonsense recognition of income, and takes to task many creative financial maneuvers of companies which “window dress” their financial statements or are “dressing up the bride” prior to a sale.
He also draws similar and different problems confronting accounting rules for non-profit firms and government institutions.
From talking about rethinking the rules, the author also takes up ethical behavior among auditors and accountants. He says: “If professionals steal money, lie, produce an inferior product, or commit other sins, their conduct is illegal and they can be punished in the courts.” However, some conduct may be legal, but it can be unethical, he points out.
Doubtless, financial accounting is a serious matter. An executive can be thrown to jail for accounting fraud. Or, on the basis of an auditor’s report, a Chief Justice may be impeached. The author has a word for auditors: They must exercise “due diligence.” And that simply means: They must do enough work with the satisfaction that their financial statements report what they are supposed to report.
But, first of all, change the rules, because the 21st century corporate world is an entirely different ball game.
By Robert N. Anthony
McGraw Hill, 2004
You walk down the streets of the country’s financial district, Ayala Avenue, and you would note impressive high rise buildings. The same is true when – immobilized by the intractable traffic re-routing within the Ortigas Center – you are awed by rows and rows of edifices challenging the heights.
And you wonder: Are the companies which own or have naming rights to these buildings really viable. But, you quickly remember an old adage not to “judge the book by its cover” (or a recent one from the sister of a lovelorn mayor: “Don’t judge him; he is not a book”).
So, speaking of buildings, don’t judge a company by its façade or its giant signboard. After all, there is always “a small company with a big sign” in every square meter of Ayala, Ortigas, Alabang and Filinvest business districts.
So, if facades won’t do it, how do you know the company you are talking to or investing in is well worth its image? Thank God, there are accountants who make sure you can see the innards of the company – with its balance sheet of assets, liabilities and equity. In the past, we could truly say we trust the financial statement as a sacrosanct document, its integrity beyond question. And, so we always said: “Look at the figures.”
And yet after the debacle of Enron (which initially impressed me when top Enron executives Ken Lay and Rebecca Mark flew into town by private jet some years ago) and after the wholesale accounting fraud by WorldCom, the sacred balance sheet has fallen out of grace. Not only that. With the advent of companies whose assets are not, strictly speaking, “physical,” how can one now reduce these assets to pesos and centavos?
Thus, you have “creative accounting” on one side where you need new investigative tools to spot any shenanigan, and you have hi-tech firms whose assets while purely intangible are inestimably valuable. This backdrop encouraged accounting guru Robert Anthony to write the book, “Rethinking the Rules of Financial Accounting.”
Anthony lays his premises well, drawing from the rigors of sciences. He points out: “Most disciplines – physics, chemistry, economics, medicine, engineering, and mathematics – have a conceptual framework for reporting measurements and a set of rules consistent with that framework. Those frameworks and rules have to be examined from time to time as the world changes. Inconsistencies in the rules creep in over time, and the rules do not incorporate new measurement techniques.”
This book is meant for accountants, with technical terms that may be abstruse to the layperson. But, if you are an executive, who went through Accounting for Non-Accountants or have gone through the rigors of MBA training, the fundamental issues raised by the book yield to some, if not easy, understanding.
Thus Anthony begins with a basic truth, “Accounting rules are rules for measurement” – and proceeds to define measurement as ‘the process of associating numbers with physical quantities and phenomena.’ Financial accounting rules measure ‘physical quantities’ in three categories – assets, liabilities and equity – at one moment in time.”
Arriving at a company’s net worth or true value is the crux of the problem confronted by the author. And yet, at the end of every chapter or section, he wrestles with the same old question: How do you reduce to numbers the operating performance of the company – and then how do you “photograph” its financial condition in a balance sheet?
The author begins with the first hurdle: terminology. He points out that even the Federal Accounting Advisory Board of the U.S. showed in a 1998 study that companies have two names for the same item. “Operating income” was used 356 times and “operating profit” was used 146 times.
He moves on to discuss the “Financial Position Statement.” After he volunteers a historical tidbit that the balance sheet has already been used for 500 years, he makes a shocking statement: The balance sheet “does not report an entity’s financial position.”
He explains: “The asset side does not, and cannot, report all the resources that an entity owns or controls.” He cites as examples the value of brands, new products, and the quality of a firm’s management. He also notes the increasing importance of these “intangibles” as knowledge-based assets.
An interesting “did-you-know” info tip is in this book. Accounting’s “dual aspect concept,” according to Anthony, was first used in Italy in the early 15th century by Luca Pacioli’s Summa (1494) who stated that accounting should measure two equal aspects of every transaction. He labeled one aspect “debit” and the other “credit”. It was widely used by companies sending a fleet of ships at the end of the voyage.
In more chapters covering statements on income and cash flow, Anthony argues for the use of the same terminology, no-nonsense recognition of income, and takes to task many creative financial maneuvers of companies which “window dress” their financial statements or are “dressing up the bride” prior to a sale.
He also draws similar and different problems confronting accounting rules for non-profit firms and government institutions.
From talking about rethinking the rules, the author also takes up ethical behavior among auditors and accountants. He says: “If professionals steal money, lie, produce an inferior product, or commit other sins, their conduct is illegal and they can be punished in the courts.” However, some conduct may be legal, but it can be unethical, he points out.
Doubtless, financial accounting is a serious matter. An executive can be thrown to jail for accounting fraud. Or, on the basis of an auditor’s report, a Chief Justice may be impeached. The author has a word for auditors: They must exercise “due diligence.” And that simply means: They must do enough work with the satisfaction that their financial statements report what they are supposed to report.
But, first of all, change the rules, because the 21st century corporate world is an entirely different ball game.
Sunday, August 24, 2003
Industry titans of the ‘20s Dish out ‘modern’ thoughts
“Wisdom from the Robber Barons”
By George David Smith & Frederick Dalzell
Castle Books, 2002
The book’s title is attractive enough – “Wisdom from the Robber Barons.” (I picked it out from a cozy bookstore called Libris Books.)
Mixing robbers and barons is intriguing. (I recall a text message, which says: Little thieves go to prison, while big thieves are elected to public office!)
Are we talking about the same thing in the case of this breed of barons? The authors give an explanation to this two-phrase appellation:
“Robbers – some of them anyway – became ‘Barons.’ Men like Henry Ford were not necessarily bent on getting rich – but they did.
As they build up business empires, harddriving industrialists acquired vast personal wealth. They became so rich that their holdings dwarfed those of the country’s traditional elite.”
But this book is much more than detailing the ways these robber barons got rich, as if money was there for picking.
Set in the period from 1970 to 1929, the historical accounts in this book prove the truism that “history repeats – and renews (if I may add) itself.”
We have been told about – and thus accustomed to – the idea that the rich and famous in a past as distant as the roaring twenties used crude and antiquated methods while on the way to making vast fortunes (and earning fame in the process).
But, if you read this lively history if the titans of industry – like Thomas Edison, Henry Ford, Andrew Carnegie, John Rockefeller, Alfred Sloan and J.P. Morgan – you will be surprised that they were ahead of their time.
We held the view, for example, the “customer-driven company” was a new thing.
But, Henry Ford said it sometime in 1908: “We start with the customer, work back through the design, and finally arrive at manufacturing.”
Theodore Levitt in the nineties went on to criticize “marketing myopia,” and batted for a “market-driven, not production-dictated strategy.”
We thought that relying heavily on advertising to sell products is a modern concept, but listen to Atlanta chemist John Pemberton, who concocted a dark sugar water: “If I could get $25,000, I would spend $24,000 for advertising, the remainder in making Coca Cola. Then we would all be rich.”
As business history would have it, a marketing wizard, Asa Candler, gained control of this giant soda firm.
And this century which we prefer to view as dominated by the “knowledge society,” we say that “thought capital” is a new thing, and coming up with crazy ideas is a newfangled reality.
But, what would you make of this quote from Mark Twain: “The man with a new idea is a Crank until the idea succeeds.” (I recall a quote that follows the same logic: “Coup plotters, when they fail, are terrorists; when they succeed, they are liberators.”)
On to saner matters… Were the robber barons thinking only of money? Harvey Firestone, who became the largest supplier of tires to Ford, said otherwise. “Thought, not money, is the real business capital,” he said.
On competing strategies, the book gives accounts of varying styles. Carnegie hated pirating managers.
In contrast, Rockfeller bought out rival oil refiners and pirated competitors’ business managers.
An interesting discussion on “creativity” and “bureaucracy” is instructive to us in this so-called modern business world where a “bureaucrat” is a bad name.
And yet, the pioneers confessed their need for a system-driven bureaucracy. The authors said: “Creators had to become, or give way to, bureaucrats.”
Were the robber barons aware of their social responsibilities? Much has been said about William Vanderbilt who was quoted as saying that, “The public be dammed”; and J.P. Morgan barking, “I owe the public nothing.”
The book explains this outburst: “Morgan’s response was actually more neutral. But it betrayed a deep public uneasiness with power that people like Morgan were accumulating”
Ford said something that underscores the social function of companies beyond profit. When asked by his shareholders, “What do you mean by “doing as much good as possible?” Ford’s answer was: “Give employment and sent out the car where the people can use it.” The shareholders countered: “Is that all?” Ford’s answers might as well be the reply of the devotees of corporate social responsibility:
“I suppose … incidentally, we make money.”
From the looks of it, the strategies and mindsets of these barons prove to be as timely and as relevant today as when they conquered territories in the past.
The difference is, their ideas come more fresh, simpler and more direct – shorn of complex theories and models.
Harking back to the creators would surely be useful for our “modern thinkers who would realize their ideas are not so modern after all.
By George David Smith & Frederick Dalzell
Castle Books, 2002
The book’s title is attractive enough – “Wisdom from the Robber Barons.” (I picked it out from a cozy bookstore called Libris Books.)
Mixing robbers and barons is intriguing. (I recall a text message, which says: Little thieves go to prison, while big thieves are elected to public office!)
Are we talking about the same thing in the case of this breed of barons? The authors give an explanation to this two-phrase appellation:
“Robbers – some of them anyway – became ‘Barons.’ Men like Henry Ford were not necessarily bent on getting rich – but they did.
As they build up business empires, harddriving industrialists acquired vast personal wealth. They became so rich that their holdings dwarfed those of the country’s traditional elite.”
But this book is much more than detailing the ways these robber barons got rich, as if money was there for picking.
Set in the period from 1970 to 1929, the historical accounts in this book prove the truism that “history repeats – and renews (if I may add) itself.”
We have been told about – and thus accustomed to – the idea that the rich and famous in a past as distant as the roaring twenties used crude and antiquated methods while on the way to making vast fortunes (and earning fame in the process).
But, if you read this lively history if the titans of industry – like Thomas Edison, Henry Ford, Andrew Carnegie, John Rockefeller, Alfred Sloan and J.P. Morgan – you will be surprised that they were ahead of their time.
We held the view, for example, the “customer-driven company” was a new thing.
But, Henry Ford said it sometime in 1908: “We start with the customer, work back through the design, and finally arrive at manufacturing.”
Theodore Levitt in the nineties went on to criticize “marketing myopia,” and batted for a “market-driven, not production-dictated strategy.”
We thought that relying heavily on advertising to sell products is a modern concept, but listen to Atlanta chemist John Pemberton, who concocted a dark sugar water: “If I could get $25,000, I would spend $24,000 for advertising, the remainder in making Coca Cola. Then we would all be rich.”
As business history would have it, a marketing wizard, Asa Candler, gained control of this giant soda firm.
And this century which we prefer to view as dominated by the “knowledge society,” we say that “thought capital” is a new thing, and coming up with crazy ideas is a newfangled reality.
But, what would you make of this quote from Mark Twain: “The man with a new idea is a Crank until the idea succeeds.” (I recall a quote that follows the same logic: “Coup plotters, when they fail, are terrorists; when they succeed, they are liberators.”)
On to saner matters… Were the robber barons thinking only of money? Harvey Firestone, who became the largest supplier of tires to Ford, said otherwise. “Thought, not money, is the real business capital,” he said.
On competing strategies, the book gives accounts of varying styles. Carnegie hated pirating managers.
In contrast, Rockfeller bought out rival oil refiners and pirated competitors’ business managers.
An interesting discussion on “creativity” and “bureaucracy” is instructive to us in this so-called modern business world where a “bureaucrat” is a bad name.
And yet, the pioneers confessed their need for a system-driven bureaucracy. The authors said: “Creators had to become, or give way to, bureaucrats.”
Were the robber barons aware of their social responsibilities? Much has been said about William Vanderbilt who was quoted as saying that, “The public be dammed”; and J.P. Morgan barking, “I owe the public nothing.”
The book explains this outburst: “Morgan’s response was actually more neutral. But it betrayed a deep public uneasiness with power that people like Morgan were accumulating”
Ford said something that underscores the social function of companies beyond profit. When asked by his shareholders, “What do you mean by “doing as much good as possible?” Ford’s answer was: “Give employment and sent out the car where the people can use it.” The shareholders countered: “Is that all?” Ford’s answers might as well be the reply of the devotees of corporate social responsibility:
“I suppose … incidentally, we make money.”
From the looks of it, the strategies and mindsets of these barons prove to be as timely and as relevant today as when they conquered territories in the past.
The difference is, their ideas come more fresh, simpler and more direct – shorn of complex theories and models.
Harking back to the creators would surely be useful for our “modern thinkers who would realize their ideas are not so modern after all.
Sunday, June 01, 2003
Presidential agenda and style At its best and most intimate
“John F. Kennedy: The Presidential Portfolio”
By Charles Kenney
Public Affairs (Perseus Nooks), 2000
A sense of nostalgia grips us every time we read a well-written speech that was actually delivered by a head of state.
In Nelson Mandela, you sense the fire and passion of one who went through a crucible of human struggle. In Tony Blair, you are moved by a stirring eloquence – marked by a steely resolve – in the middle of contrary opinion worldwide (like invasion of Iraq).
And in John F. Kennedy, you happily note an easy style and flawless rhetoric that justifies the observation that Kennedy truly brought back elegance to the Presidential office – and have given Presidential speeches the quality that comes close to literature – if they are not literature itself.
The nostalgia persists because the present crop of leaders around the world – and at home – no longer bother about style, as if rhetoric is luxury, not necessity. They are wrong.
If the medium is the message, as Marchall Macluhan said many years ago, then crafting a statement of a speech is both science and art that requires the preoccupation of Presidents or their handlers.
Here is why: As someone put it, a leader may fail in other areas, but he or she should not fails to inspire. A thoughtfully crafted statement that “connects” with the people, or touch of poetry in policy that goes to the heart of the problem (and them to the “hearts” of one’s countrymen) becomes unforgettable – because it touches the core of their fierce hopes.
But, it is only in public that a head of state moves a nation. It is also in his private movements – “away from the maddening crown” – where he or she communicates a substance and style that makes one loved, at best, and credible, at least.
The problem is how do we know how these very public figures speak in the privacy of their living rooms or chat in the warmth of their fireplace?
Thankfully, there is a coffee table book, a rare find from Powerbooks, that makes
Eavesdroppers of us all.
The book, “John F. Kennedy: Presidential Portfolio,” brings the reader intimately closer to how this President made difficult decisions “in an hour of maximum danger” like the Cuban Crisis in 1962: You actually eavesdrop on his critical conversation with former President Dwight Eisenhower – and appreciate the complexity of the options to be taken, calibrated to avoid a nuclear war.
This book has the best of worlds of printed text and sound in compact disc. The printed text is divided into chapters that zero in on interesting highlights in the life of this President who continues to fascinate people.
A description of the enigmatic Jacqueline Bouvier Kennedy is both apt and well informed, as when the author says: “From the beginning, there was something about her, something that set her apart.”
In the chapter, “The Power of Symbols,” the book identifies two favorite projects of Kennedy; the Peace Corps and the Space Race. The book says: “While Peace Corps volunteers labored on the ground, a much larger cold war competition was taking place far above the earth in the newest of all frontiers, outer space.”
When Yuri Gagarin orbited around the world, the Soviets outraced America. And so Kennedy asked: “Is there any place we can catch them?” So the President authorized a costly space program that landed the first man on the moon.
More intimate takes of Kennedy’s decision making, subdued temper, easy going style and unorthodox campaigning are in this book. This is one book that proves to be a fitting sequel to a much earlier book by Theodore White, entitled, “The Making of a President.”
And yet, since this is the 21st century, this portfolio has outdone White, since this one comes with a CD.
One intimate talk is with brother Robert Kennedy where they discuss how to deal with Harry Luce of Time. The third is a revealing exchange between Kennedy and White House spokesperson Lincoln White.
Kennedy chided (not scolded) White because of an unauthorized extension of the President’s statement.
“You’ve got to be goddam careful!” says Kennedy, with subdued temper. (His lesson for holding Presidential tantrums!)
The CD has about 14 tracks. A riveting voice track is the exchange between Kennedy and Eisenhower where, according to the commentator. Eisenhower is “treating Kennedy like a kid,” but in the end agrees with him and calls him respectfully as President.
In this discussion, Kennedy speaks about “increasing number of steps” on the Cuban blockade. Then he asks the General : “If we attack, could it trigger a nuclear war?” The General, with a voice of experience, replies: “I don’t think they fill fire the missles.”
In a century bereft of substance and style, where speeches sound like inter-office memoranda; in an age where a head of state loses his/her temper – and we’ll call it “forthright” – and berates his/her subordinates – and we call it “strong” – we need his kind of book to remind the top leaders that they owe such office some breeding and style – and so inspire our countrymen.
By Charles Kenney
Public Affairs (Perseus Nooks), 2000
A sense of nostalgia grips us every time we read a well-written speech that was actually delivered by a head of state.
In Nelson Mandela, you sense the fire and passion of one who went through a crucible of human struggle. In Tony Blair, you are moved by a stirring eloquence – marked by a steely resolve – in the middle of contrary opinion worldwide (like invasion of Iraq).
And in John F. Kennedy, you happily note an easy style and flawless rhetoric that justifies the observation that Kennedy truly brought back elegance to the Presidential office – and have given Presidential speeches the quality that comes close to literature – if they are not literature itself.
The nostalgia persists because the present crop of leaders around the world – and at home – no longer bother about style, as if rhetoric is luxury, not necessity. They are wrong.
If the medium is the message, as Marchall Macluhan said many years ago, then crafting a statement of a speech is both science and art that requires the preoccupation of Presidents or their handlers.
Here is why: As someone put it, a leader may fail in other areas, but he or she should not fails to inspire. A thoughtfully crafted statement that “connects” with the people, or touch of poetry in policy that goes to the heart of the problem (and them to the “hearts” of one’s countrymen) becomes unforgettable – because it touches the core of their fierce hopes.
But, it is only in public that a head of state moves a nation. It is also in his private movements – “away from the maddening crown” – where he or she communicates a substance and style that makes one loved, at best, and credible, at least.
The problem is how do we know how these very public figures speak in the privacy of their living rooms or chat in the warmth of their fireplace?
Thankfully, there is a coffee table book, a rare find from Powerbooks, that makes
Eavesdroppers of us all.
The book, “John F. Kennedy: Presidential Portfolio,” brings the reader intimately closer to how this President made difficult decisions “in an hour of maximum danger” like the Cuban Crisis in 1962: You actually eavesdrop on his critical conversation with former President Dwight Eisenhower – and appreciate the complexity of the options to be taken, calibrated to avoid a nuclear war.
This book has the best of worlds of printed text and sound in compact disc. The printed text is divided into chapters that zero in on interesting highlights in the life of this President who continues to fascinate people.
A description of the enigmatic Jacqueline Bouvier Kennedy is both apt and well informed, as when the author says: “From the beginning, there was something about her, something that set her apart.”
In the chapter, “The Power of Symbols,” the book identifies two favorite projects of Kennedy; the Peace Corps and the Space Race. The book says: “While Peace Corps volunteers labored on the ground, a much larger cold war competition was taking place far above the earth in the newest of all frontiers, outer space.”
When Yuri Gagarin orbited around the world, the Soviets outraced America. And so Kennedy asked: “Is there any place we can catch them?” So the President authorized a costly space program that landed the first man on the moon.
More intimate takes of Kennedy’s decision making, subdued temper, easy going style and unorthodox campaigning are in this book. This is one book that proves to be a fitting sequel to a much earlier book by Theodore White, entitled, “The Making of a President.”
And yet, since this is the 21st century, this portfolio has outdone White, since this one comes with a CD.
One intimate talk is with brother Robert Kennedy where they discuss how to deal with Harry Luce of Time. The third is a revealing exchange between Kennedy and White House spokesperson Lincoln White.
Kennedy chided (not scolded) White because of an unauthorized extension of the President’s statement.
“You’ve got to be goddam careful!” says Kennedy, with subdued temper. (His lesson for holding Presidential tantrums!)
The CD has about 14 tracks. A riveting voice track is the exchange between Kennedy and Eisenhower where, according to the commentator. Eisenhower is “treating Kennedy like a kid,” but in the end agrees with him and calls him respectfully as President.
In this discussion, Kennedy speaks about “increasing number of steps” on the Cuban blockade. Then he asks the General : “If we attack, could it trigger a nuclear war?” The General, with a voice of experience, replies: “I don’t think they fill fire the missles.”
In a century bereft of substance and style, where speeches sound like inter-office memoranda; in an age where a head of state loses his/her temper – and we’ll call it “forthright” – and berates his/her subordinates – and we call it “strong” – we need his kind of book to remind the top leaders that they owe such office some breeding and style – and so inspire our countrymen.
Sunday, May 18, 2003
Gaining the upper hand anytime, anywhere
“Victory”
Brian Tracy
American Management Association
(AMACOM), 2002
When it comes to self-help books, those who present general principles instead of detailed how-tos are preferable. Why? Because they manifest the respect the author places on his readers.
Here comes a refreshing exception to the hot-to-mode – Brian Tracy with his latest book, “Victory,” subtitled, “Applying the Proven Principles of Military Strategy to Achieve Greater Success in Your Business and Personal Life.” It contains 12 basic principles needed to attain victory at work and in one’s personal life.
The book may sound intimidating to some at first blush, conjuring as it does images of stern officers shouting obscenities at hapless foot solders of even razing a city to the ground. Fortunately, Tracy sees “generalship” in the mold of “officers and gentlemen.” In fact, Tracy says in his introduction, “Victory” is for the ambitious, energetic, determined, success-oriented individual. As for ordinary mortals, the author assured us that “each of the principles of military strategy can be learned.”
Having trained more than two million people, written 26 books and turned around 22 different businesses in diverse industries, the author easily convinces us when he says that we are moving into the “Golden Age” of mankind, an age when more people will accomplish or dreamed of in all the history of humanity. And we eagerly anticipate winning our personal battle and “being all that we can be.”
The author dedicates one chapter each to the 12 tried and tested principles of strategy that have been used by top military leaders for more than 20 centuries and by business executives, too. He helpfully subdivides these into “business” and “personal life.” Each of the 12 principles, the author declares, has by itself been responsible for victories or defeats. What’s more, each of them works as well in the concrete/corporate jungles as well as in the battlefield.
The Principle of Maneuver (“Remain flexible at all times”), for example, is applied by the author to the “Hail Mary” attack during the Gulf War: “After eliminating the ability of the Iraqi army to get accurate information on the movement of his army, General Norman Schwarzkopf moved what appeared to be a large force up to the Kuwaiti border. The enemy moved forward to meet the attack.
“Meanwhile, under the cover of night, Schwarzkopf had moved 250,000 troops 50 miles to the west. Then they launched a sweeping flank attack around the Iraqi forces, cutting them off at Basra and effectively ending the Gulf War. By destroying the enemy’s ability t get accurate intelligence, Schwarzkopf was able to end the way quickly and effectively. He concentrated on reducing the time necessary to win the war and came up with the single most effective maneuver.”
The chapters deal with fundamental strategies – like “clarity,” for example. A leader of a manager cannot hope to lead his men if his goal is not clear to him and if his strategy is fuzzy.
The author deftly weaves his considerable experience in personal and professional development into his interest in military history. For that he might well take his place among the strategists he so knowledgeably expounds on.
Tracy makes sure he drives home the point of devoting the 13th and last chapter to a review of the 12 strategies. That’s putting the Principle of the Mass (“Focus single-mindedly on one thing, the most important thing, and stay with it until it is done”) to practice.
Contemporary books may not agree to out usual bent of using the metaphors of war and the similes of the battlefield. Some authors are now saying we are “marching to a different drum” – not of battle but of peace. And yet, the compelling truths about winning the war are durable in a world of conflict of contest. Thus, the book remains relevant and certainly useful.
Brian Tracy
American Management Association
(AMACOM), 2002
When it comes to self-help books, those who present general principles instead of detailed how-tos are preferable. Why? Because they manifest the respect the author places on his readers.
Here comes a refreshing exception to the hot-to-mode – Brian Tracy with his latest book, “Victory,” subtitled, “Applying the Proven Principles of Military Strategy to Achieve Greater Success in Your Business and Personal Life.” It contains 12 basic principles needed to attain victory at work and in one’s personal life.
The book may sound intimidating to some at first blush, conjuring as it does images of stern officers shouting obscenities at hapless foot solders of even razing a city to the ground. Fortunately, Tracy sees “generalship” in the mold of “officers and gentlemen.” In fact, Tracy says in his introduction, “Victory” is for the ambitious, energetic, determined, success-oriented individual. As for ordinary mortals, the author assured us that “each of the principles of military strategy can be learned.”
Having trained more than two million people, written 26 books and turned around 22 different businesses in diverse industries, the author easily convinces us when he says that we are moving into the “Golden Age” of mankind, an age when more people will accomplish or dreamed of in all the history of humanity. And we eagerly anticipate winning our personal battle and “being all that we can be.”
The author dedicates one chapter each to the 12 tried and tested principles of strategy that have been used by top military leaders for more than 20 centuries and by business executives, too. He helpfully subdivides these into “business” and “personal life.” Each of the 12 principles, the author declares, has by itself been responsible for victories or defeats. What’s more, each of them works as well in the concrete/corporate jungles as well as in the battlefield.
The Principle of Maneuver (“Remain flexible at all times”), for example, is applied by the author to the “Hail Mary” attack during the Gulf War: “After eliminating the ability of the Iraqi army to get accurate information on the movement of his army, General Norman Schwarzkopf moved what appeared to be a large force up to the Kuwaiti border. The enemy moved forward to meet the attack.
“Meanwhile, under the cover of night, Schwarzkopf had moved 250,000 troops 50 miles to the west. Then they launched a sweeping flank attack around the Iraqi forces, cutting them off at Basra and effectively ending the Gulf War. By destroying the enemy’s ability t get accurate intelligence, Schwarzkopf was able to end the way quickly and effectively. He concentrated on reducing the time necessary to win the war and came up with the single most effective maneuver.”
The chapters deal with fundamental strategies – like “clarity,” for example. A leader of a manager cannot hope to lead his men if his goal is not clear to him and if his strategy is fuzzy.
The author deftly weaves his considerable experience in personal and professional development into his interest in military history. For that he might well take his place among the strategists he so knowledgeably expounds on.
Tracy makes sure he drives home the point of devoting the 13th and last chapter to a review of the 12 strategies. That’s putting the Principle of the Mass (“Focus single-mindedly on one thing, the most important thing, and stay with it until it is done”) to practice.
Contemporary books may not agree to out usual bent of using the metaphors of war and the similes of the battlefield. Some authors are now saying we are “marching to a different drum” – not of battle but of peace. And yet, the compelling truths about winning the war are durable in a world of conflict of contest. Thus, the book remains relevant and certainly useful.
Sunday, February 16, 2003
Going with the current, and controlling the flow
“Shaping the Adaptive Organization”
By William E. Fulmer
American Management Association, 2002
This book on rapid change began with the subject of “land speed.”
The author points out that Craig Breedlove broke the land speed record with 600 mph on land. How did he do it? “I broke the rules,” Breedlove said. But later in 1983, Breedlove was dislodged from that distinction as the fastest man-machine alive when Richard Noble of England broke the record with a land speed of 650 mph. Noble said of his feat: “It was both exhilarating and frightening.”
Thus the author, Mr. Fulmer interestingly describes the times we – and our businesses – are in. “Due to the speed of change, companies are coping with a new reality – it is an increasingly uncertain and chaotic world.” And so you must be prepared to “break the rules.” The prospects, however, are frightening.
With that Fulmer points out that an organization can only survive rapid change if it is an “adaptive organization.” How can one adapt? The author volunteers three foundations for such a flexible enterprise – Landscape, Learning and Leadership.
Fulmer devotes the most space to Landscape. He refers to what we traditionally call the “environment.” But, since he sticks to the analogy of Life, the author calls the world within which the enterprise exists or moves as Landscape.
The reading of this section of the book is slow, difficult and complex. He quotes evolutionists, biologists, and many other scientists to prove that such a landscape is as complex and as unpredictable as an organism. He uses words as “equilibrium” and “dis-equilibrium” to demonstrate that a business, like an organism, is in a constant state of dis-equilibrium – yes, flux.
Actually, it is a scholar’s way of saying a central truth that we knew much earlier: “You can only be certain about a human being when he is dead. If he is alive, he is unpredictable.”
So, where is the author bringing us? He actually builds a case so tight that he has to give up what he learned in his MBA class in the sixties which believed the dictum – “Structure should follow strategy.” What that means is: You can only build an organizational or project structure once the strategy has been formulated.
That didn’t work, the author says.
So, he now says that “structure follows landscape.” Then, he makes this revision: “It is more accurate to say: “Both structure and strategy must adapt to the landscape.”
This Landscape has “hills and valleys, with smooth and rugged surfaces” – metaphors for lows and peaks in business, the turbulence, on one hand, and the smooth predictability of the marketplace, on the other.
The author is saying that the enterprise must adapt to the landscape. That is not new, of course. What’s new is the extended metaphor between biological life and economic life. Since life is complex enough, business must be, too, he proves. This is not actually a reassuring thought. But, the life of simplicity is over. It will never be the same.
So, he also underscores the importance of a learning organization. That’s not new, too, except that business nowadays must continually learn and re-learn strategies and competitive moves in more frequent intervals.
The author mercifully comes to a crystal clear conclusion that businesses can use. He says: “Life exists at the edge of chaos. It is near the edge that life is best able to coordinate complex activities and evolve.” This sounds familiar. Years ago, Tom Peters said in his “Liberation Management” book, that revolutionaries do not come from the center: they come from the fringes of society.
But, we must credit the author for not using mixed metaphors. He has stuck to Life’s analogies. Underscoring an enterprise’s preparedness for rapid change, he uses the “water” metaphor. “Systems too deep into the frozen ordered regime (like solid ice) are too rigid to coordinate the complex sequences of genetic activities necessary for development. If they are too far into the gaseous chaotic regime, they will not be orderly enough.” And here’s the illuminating statement: “It is the nearly melted state that corresponds to the edge of chaos.”
He is telling companies to sit at the edge of their seats, ever prepared for change. So, while the author makes much of evolution and uncontrollable forces, it is a relief that he gives credit to Leadership, the most important (I think) foundation for the adaptive organization. The innovative leader “must prevail,” to paraphrase the author’s namesake, William Faulkner, in his speech when he accepted the Nobel Prize.
This central truth boils downs to leadership. He proves his point with this statement:
“The guy who invented the first wheel was an idiot. The guy who invented the other three – he was a genius.” Bill Gates did not develop the first computer operating system. He made his system widely available.
How to shape an “adaptive organization”? Read and comprehend this slow-read, but well-written book. Somehow, if you miss some technical points, look up Bill Gates and other leaders who serve as role models to leaders who ride “the crest of change.” In the final analysis, the leader does not always adapt. In defining moments, he is in command.
By William E. Fulmer
American Management Association, 2002
This book on rapid change began with the subject of “land speed.”
The author points out that Craig Breedlove broke the land speed record with 600 mph on land. How did he do it? “I broke the rules,” Breedlove said. But later in 1983, Breedlove was dislodged from that distinction as the fastest man-machine alive when Richard Noble of England broke the record with a land speed of 650 mph. Noble said of his feat: “It was both exhilarating and frightening.”
Thus the author, Mr. Fulmer interestingly describes the times we – and our businesses – are in. “Due to the speed of change, companies are coping with a new reality – it is an increasingly uncertain and chaotic world.” And so you must be prepared to “break the rules.” The prospects, however, are frightening.
With that Fulmer points out that an organization can only survive rapid change if it is an “adaptive organization.” How can one adapt? The author volunteers three foundations for such a flexible enterprise – Landscape, Learning and Leadership.
Fulmer devotes the most space to Landscape. He refers to what we traditionally call the “environment.” But, since he sticks to the analogy of Life, the author calls the world within which the enterprise exists or moves as Landscape.
The reading of this section of the book is slow, difficult and complex. He quotes evolutionists, biologists, and many other scientists to prove that such a landscape is as complex and as unpredictable as an organism. He uses words as “equilibrium” and “dis-equilibrium” to demonstrate that a business, like an organism, is in a constant state of dis-equilibrium – yes, flux.
Actually, it is a scholar’s way of saying a central truth that we knew much earlier: “You can only be certain about a human being when he is dead. If he is alive, he is unpredictable.”
So, where is the author bringing us? He actually builds a case so tight that he has to give up what he learned in his MBA class in the sixties which believed the dictum – “Structure should follow strategy.” What that means is: You can only build an organizational or project structure once the strategy has been formulated.
That didn’t work, the author says.
So, he now says that “structure follows landscape.” Then, he makes this revision: “It is more accurate to say: “Both structure and strategy must adapt to the landscape.”
This Landscape has “hills and valleys, with smooth and rugged surfaces” – metaphors for lows and peaks in business, the turbulence, on one hand, and the smooth predictability of the marketplace, on the other.
The author is saying that the enterprise must adapt to the landscape. That is not new, of course. What’s new is the extended metaphor between biological life and economic life. Since life is complex enough, business must be, too, he proves. This is not actually a reassuring thought. But, the life of simplicity is over. It will never be the same.
So, he also underscores the importance of a learning organization. That’s not new, too, except that business nowadays must continually learn and re-learn strategies and competitive moves in more frequent intervals.
The author mercifully comes to a crystal clear conclusion that businesses can use. He says: “Life exists at the edge of chaos. It is near the edge that life is best able to coordinate complex activities and evolve.” This sounds familiar. Years ago, Tom Peters said in his “Liberation Management” book, that revolutionaries do not come from the center: they come from the fringes of society.
But, we must credit the author for not using mixed metaphors. He has stuck to Life’s analogies. Underscoring an enterprise’s preparedness for rapid change, he uses the “water” metaphor. “Systems too deep into the frozen ordered regime (like solid ice) are too rigid to coordinate the complex sequences of genetic activities necessary for development. If they are too far into the gaseous chaotic regime, they will not be orderly enough.” And here’s the illuminating statement: “It is the nearly melted state that corresponds to the edge of chaos.”
He is telling companies to sit at the edge of their seats, ever prepared for change. So, while the author makes much of evolution and uncontrollable forces, it is a relief that he gives credit to Leadership, the most important (I think) foundation for the adaptive organization. The innovative leader “must prevail,” to paraphrase the author’s namesake, William Faulkner, in his speech when he accepted the Nobel Prize.
This central truth boils downs to leadership. He proves his point with this statement:
“The guy who invented the first wheel was an idiot. The guy who invented the other three – he was a genius.” Bill Gates did not develop the first computer operating system. He made his system widely available.
How to shape an “adaptive organization”? Read and comprehend this slow-read, but well-written book. Somehow, if you miss some technical points, look up Bill Gates and other leaders who serve as role models to leaders who ride “the crest of change.” In the final analysis, the leader does not always adapt. In defining moments, he is in command.
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