Tom Peters made his name as a management guru by analysing what made big US companies successful.

In Search of Excellence - the hugely influential 1982 bestseller he co-authored with Robert Waterman - scrutinised Caterpillar, Procter & Gamble, Johnson & Johnson and 40 other businesses the pair had deemed to be “excellent”.

Now, in an audio interview with the FT Management Blog, he says their focus on the largest beasts was a “guru gaffe” that helped to create a lingering misconception that the global economy is merely a division of General Electric.

These days, the companies that get him excited tend to be small- to medium-sized enterprises operating in dull industries: companies like Jim’s Group, an Australian franchiser whose activities range from lawn mowing to dog washing, or members of the German Mittelstand.

“There are actually more companies than GE in the world,” he says. And that goes for Google too.

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There’s an enjoyably quirky article about multiplayer online games in the latest Harvard Business Review. The authors, professors at Stanford, MIT and North Carolina State, report on whether the likes of World of Warcraft and Everquest can teach real managers any leadership lessons. Tentatively, they conclude that the way players - often complete strangers - operate in teams during these games can be instructive:

True, leading 25 guild members in a six-hour raid on Illidan the Betrayer’s temple fortress is hardly the same as running a complex global organization. For starters, the stakes are just a bit higher in business. But don’t dismiss online games as mere play.

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Senior management teams are great at coming up with strategic priorities, to the extent that many are drowning in them. But while it is platitudinous to point out that the existence of too many goals confuses staff and leads to sketchy execution, the path to rectifying strategic overload is less obvious. Yet Peter Killing, a professor at IMD, the Swiss business school, says there is a clear method that bosses can use to define and approach their company’s “must-win battles”. You can listen to him detail these steps in a 16-minute audio interview here, or click on the rest of this post for a written summary.

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A wise colleague once said: “If you can keep your head when all about you are losing theirs, you have probably failed to grasp the seriousness of the situation.”

How bad are market conditions today? Should we be panicking or is it time to keep a cool head when all about you have lost the plot?

I cannot answer these questions for you. But we should, I think, be guided by the sobriety and realism of the words quoted above. Even if some economists have predicted all seven of the last three recessions, that doesn’t mean they are necessarily wrong this time.

Continue reading “Kipling’s wise words”

Thirty years ago, a French business legend was peering into the abyss. Once classed as one of the world’s richest men, Marcel Boussac was known as King Cotton, ruler of an eponymous textiles empire that included the Dior haute couture house, which he founded. But in April 1978, the heavily indebted Boussac group was on the verge of collapse. Its autocratic but paternalistic owner, then 89 years old, had failed to respond to a surge in cheap imports from developing countries, and had also been left vulnerable by the rise of synthetic fibres. Could Mr Boussac ward off bankruptcy with yet another attempt at restructuring?

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The new McKinsey Quarterly has an excellent interview with Brad Bird, the Oscar-winning Pixar director responsible for The Incredibles and Ratatouille. Among other things, Mr Bird describes how he persuaded Pixar’s animators to strike a balance between perfectionism and expediency.

There are purists in computer graphics who are brilliant but don’t have the urgency about budgets and scheduling that responsible filmmakers do. I had to shake the purist out of them—essentially frighten them into realizing I was ready to use quick and dirty “cheats” to get something on screen if they took too long to achieve it in the computer.

He describes the value of having what he calls “black sheep” in a team: frustrated but committed individuals who want to do things differently but haven’t had the chance to prove their theories. He also praises Pixar for offering staff optional classes that foster a well-rounded workforce.

If you work in lighting but you want to learn how to animate, there’s a class to show you animation. There are classes in story structure, in Photoshop, even in Krav Maga, the Israeli self-defense system.

His peeves include “passive-aggressive people… who don’t show their colours in the group but then get behind the scenes and peck away”.

Ever since his Oscar-winning film, An Inconvenient Truth, Al Gore has been viewed as one of the world’s most persuasive public speakers. So when his new climate change lecture was premiered on Ted, a website dedicated to “inspired talks by the world’s greatest thinkers and doers”, earlier this week, I decided to pick it apart to see how it worked.

Like many people, I was impressed by An Inconvenient Truth. I’d even stood in line to hear Mr Gore speak in New York last May (this was deeply hypocritical, given that I had jetted in from Paris for an emission-heavy long weekend in Manhattan - unless getting him to sign a DVD counted as a carbon offset).

It was my hope that a close analysis of his new slideshow might be useful to public speakers in the business world. Having viewed it three times - and watched An Inconvenient Truth yet again for context - I think I have been able to identify four key elements to the performance. But after studying his verbal and visual tricks in detail, I’m not sure I’d queue to see him again.

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Harvard Business School, the creator of the MBA, celebrates its 100th birthday tomorrow. To mark the occasion, Della Bradshaw, the FT’s business education editor, has produced an authoritative analysis of the MBA’s contribution to business in its first century of existence. While the report card is mixed, there is little doubt that it remains a qualification that can seriously boost one’s salary, while at least 30 of the top 100 global companies are run by MBAs.

One of the most intriguing suggestions in the piece is that HBS graduates no longer out-earn peers at six other top US institutions, such as Stanford and Wharton (see table). A decade ago they did, according to data collected over that period by the FT, which also suggest that leading European schools such as LBS have been catching up. Jay Light, HBS dean, says he is sceptical of the numbers, adding that recruiters still lay siege to his school. But he is perfectly willing to admit that the Harvard MBA is unlikely to guarantee success in one high-octane career choice: politics.

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Tom Glocer, chief executive of Reuters, clearly takes his blog very seriously. For instance, it contains an endearingly pedantic list of his favourite musicians, including Mahler, Grateful Dead, Kanye West and “Kool & the Gang (early)”.

The precision of that final entry marks him down as a man who wants to be thoroughly understood, who wants his staff to know that while the deep funk of 1973’s Jungle Boogie might get him on to the dance floor at the Christmas party, the post-disco pap of 1984’s Cherish will leave him frozen to his chair in horror.

Flippancy aside, the ability to convey to the world exactly what you are about is a great skill for a manager to have - and it looks like Ron Sandler, the new chairman of Northern Rock, might also have the knack.

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Why has AG Lafley been so successful at running Procter & Gamble?  According to Roger Martin, dean of the University of Toronto’s Rotman School of Management, Mr Lafley is a great example of the superior leader who doesn’t reduce management to a series of “either/or” choices. Instead, he has been able to blend two seemingly incompatible courses of action into a very effective strategy.

In his recent book, The Opposable Mind, Prof Martin tells how P&G was being pushed in two different directions when Mr Lafley became chief executive in the dark days of 2000. On the one hand, the maker of Tide detergent and Crest toothpaste faced pressure to cut costs in order to compete more aggressively with own-brand goods. Yet there was an opposing school of thought that said the path to salvation lay in going upmarket by using expensive innovations to differentiate P&G brands from the me-too products.

As Prof Martin tells it - and as an advisor to Mr Lafley he has had a privileged view of the turnround - part of the genius of the P&G boss was in finding a way to reconcile these two positions into a synthesised whole that managed to satisfy both constituencies. Costs were cut but there was also a new emphasis on design and on importing external ideas that helped P&G to charge higher prices. Prof Martin calls this have-cake-and-eat-it approach ”integrative thinking”.

In this 9-minute audio interview, I chat to Prof Martin to find out how managers can structure their own problem-solving in order to avoid simplistic binary oppositions.

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