GOOD ENOUGH NEVER ISHow can we do better tomorrow than we did today?

GROUP-1

TEAM-9 501504085 PARAMPREET KAUR501504101 GURPREET SINGH501504103 VARUN KALIA501504095 NIKHIL BHARGAV401207012 JAGMEET SINGH BAJAJ

Companies Discussed in the Chapter

Methodology of Visionary Companies

Superb execution & performance are not the final goal. Nothing like “Having made it” Demanding of themselves Continuous Improvement Disciplined, Hard-working and Doing everything possible to make

company stronger for tomorrow Never settle and never be Comfortable Never being Complacent Long Term Vision in Mind (Building the company for Future)

Mechanism of Discontent

Brand Management Structure

Yielding Market Share

Innovate or Die

WORK OUT Eyes of the Enemy

BEAT YESTERDAY PAY AS YOU GO

Sales per Hour (SPH)

Mechanisms of Discontent Procter & Gamble

Created Brand Management Structure in 1931 to make brands within company compete with each other

Idea to pit the best against the best Stimulated the Change from within the company Internal competition resisted complacency Copied by Colgate 3 decades later

Mechanisms of DiscontentMerck

In 1950s adopted the strategy of Yielding Market Share Forced itself to produce new innovative products Helped the company to grow and prosper

Mechanisms of DiscontentMotorola

Used the mechanism of Innovate or Die Cut of Mature product lines to make way for new products Did with this Televisions and Radios Technology Road Map benchmarked technology progress Anticipated Market needs up to 10 years in the future

Mechanisms of DiscontentGeneral Electric

Institutionalized discomfort with their process of WORK OUT Upper managers not allowed to make inputs in group meetings

for making proposals Had to make on the spot decisions about the proposals

Mechanisms of DiscontentBoeing

Introduced planning process called Eyes of the Enemy Made managers act like as if they work for the competitor

companies They gave inputs on how they would exploit weaknesses,

Leverage Strengths Based on the inputs given by them Boeing prepared itself of How

they would respond to the situation

Mechanisms of DiscontentWal-Mart

Use of BEAT YESTERDAY Ledger books Tracked daily sales figure and compared with exact same day of

week one year earlier These ledgers were a Stimulus to Push the standards up forever

Day 1984 1985 1986 19871st Monday

1st Tuesday

1st Wednesday

1st Thursday

1st Friday

1st Saturday

1st Sunday

1st WEEK

Mechanisms of DiscontentNordstrom

Created an environment for people for never stop trying to improve

Sales per Hour (SPH) incorporated for peers Employees never relaxed after achieving targets Tracked customer feedback Employ compensation based on it

Mechanisms of DiscontentHewlett-Packard

Installed a powerful mechanism PAY AS YOU GO It resisted the use of Long Term Debt Company learned to fund its 20 plus percent average annual

growth Produced disciplined General Managers Improved leanness and efficiency in company Bootstrapping leads to innovation

Build for the Future (Do well Today)

V/S

Condition of HP afterWorld War II

Revenues Declined by 50%

Defence contracts were lost

There were no prospects in commercial Markets

Company faced Cash Flow crisis

Company faced threat of being not able to survive

Measures taken by to come out of the situation

Payroll cut by 20%

Decreased dependency on government contract business

Hired 4 bright young engineers keeping in mind the far-sighted approach

Benefits of the approach followed

As the approach was Long term and far sighted it showed results slowly after 1950.

For next two decades after 1950 they performed well and introduced a slew of innovation and profitable new products

Came up with Two perspectives Fifty-year perspective One-year perspective

Made it non-negotiable if any compromise is made for Long-term vision

following the lead of

Also guided themselves with a Long-term perspective Hired top scientists from Research labs But unfortunately paved their way away from Long-term vision. Started introducing cheap consumer products Made unexpected price cut All in lieu to grab market share and short term benefits The strategy backfired as they suffered from financial losses and

bad reputation in the market

The Long term Investment for visionary companies

R&D Employee training and Education

New Technology and Innovation

New Infrastructure development

Investing in R&D

Merck invested in basic research which is must for Pharmaceutical industry

Visionaries companies invest at about 30% by percentage of sales

Merck when compared with Pfizer had invested more It was able to sustain the Long-term corporate health

Investing in Human Capital (Employee training and education) 40 hour training per employee in a year at Motorola

Three day training course on recruiting and interviewing techniques for all managers at Merck

HP 8 people interview system GE embraced new Management methods, gave reading material

to managers on the topic of professional managing

Investing in New Technology and Innovation

TQM process being used at Merck Use of high end Financial analysis software in order to make

decisions for long term horizons Motorola also invested in new technologies Walt Disney invested in New film technology Citibank also adopted new technologies 3 decades earlier than

the comparison companies like Chase-Manhattan

Investing in New Infrastructure development

RJ Reynolds invested in Corporate Jets (RJR Air force) & Built hangars

Invested widely in Corporate offices Sponsored celebrity athletes & events McDonnel Douglas resisted to invest in bigger aircrafts Boeing used Reaching out tomorrow mindset and invested wisely

Howard Johnson’s

Complacency V/S

JW Marriot’s

Self Discipline and Continuous improvement

Self Discipline and Continuous Improvement

Complacency

Invested in infrastructure during recession Refused to invest in hotels and restaurants tailored for specific market

Pushed itself to improve the quality and the value of its services

Focussed on cost control, Efficiency & Short term financial objectives

Modest Lifestyle and personal connection to business

Lavish lifestyle, Less connection to business

Doing work with complete effort and very less propagation

Propagating more and doing less in real

Mechanisms used by which provided it the Edge

Guest Index Survey(GSI) based on customer feedback Annual performance reviews Incentive bonuses in many areas Profit Sharing program for employees High investment in HR recruitment Employee Development & Learning programs Phantom shoppers where the inspectors acted like customers

Success Mantras to become a Visionary Company

Creating Mechanism of Discontent Invest for future Building the present Responding wisely and with future approach in mind to the

Downturns Investing wisely in domains essential for the company Create an environment of Non-Complacency, sense of discomfort

and competition within the companies Hard work, Dedication to improve and Continuously building for

Future

“Achievements represent the beginning – The start of a never ending journey of

discipline, work and the pursuit of ever-higher standard”

THANK YOU