managementessentials - Essensys: Executive Interim Management · management essentials Handpick your people – bring together teams which have the right blend of skills and experience

managementessentials ESSENSYS’ FINEST SELECTION OF MANAGEMENT LITER ATURE

2015

managementessentials

MANAGEMENT EXPERTISE COMMITTED TO YOUR FUTURE SUCCESS

1 | Executive interim managementEssensys aims to provide high-quality services. In order to achieve this, we work with highly competent people who have the necessary experience, professional skills as well as ethical and moral values.Our experienced interim managers are active in the following domains: general management – change management – finance, controlling and administration – sales and marketing – human resources – logistics and supply chain – production management – ICT.

For each one of these domains, Essensys offers the following services: Guarantee of continuity Experts’ opinions Programme and project management Change and improvement management Corporate (re)development

Essensys stands for high-quality, innovative and result-driven services. We are active in Belgium, France and the Netherlands. Here is an overview of our most important services.


2 | Executive searchAt the request of a large number of our clients, Essensys is also active in the area of executive search: looking for and recruiting permanent executive managers. Here again, Essensys’ unique approach is aiming high-quality results in providing the best candidates for upper-level management positions. Recent examples include the recruitment of Chief Executive Officers, Chief Financial Officers, Chief Operating Officers and Finance Directors.

3 | Management coachingBased on many years of management expertise, Essensys also offers management coaching. Our coaching method guarantees that a period of transition within your organization leads to lasting results. Essensys management coaching is aimed at permanent middle and upper-level managers and is tailored to your business needs.

4 | Operational ExcellenceEssensys Operational Excellence assists companies in the implementation of operational excellence principles, thereby achieving lower cost, shorter lead-times, improved quality and outstanding customer service. Pragmatic and with a true focus on implementation, Essensys is committed to deliver sustainable operational & financial improvements.


Borrowing money has rarely been so cheap. We are living in an era with historically low interest rates.

However, because expectations about economic growth remain low, we have to ask: what can we buy with that? Growth markets such as Brazil or Russia have recently run into heavy weather, while the rate of growth is currently declining in China. It will also not have escaped your attention that the traditional European economic motors for growth like Germany and France are spluttering.

A growing economy creates opportunities for almost all companies to increase their turnover. A turnover increase of one per cent in a flat economy represents a vast amount of hard work. After all, you have to win that one percent from your competitors. It is no coincidence that competition has stiffened considerably in recent years. Another consequence of that flat economy is that the difference between well and poorly led companies is more visible.

Entrepreneurs are facing more than enough challenges; that is probably something you agree with us about. We are very willing to provide support to our clients that are improving their strategy and to help to assure a good roll-out of that strategy. That is why we are offering you a summary of some interesting management books that were published last year.

We hope that you can pick up some invigorating ideas.

Enjoy reading!

Michel Van Hemele Managing Partner


SELECTED FOR

YOU BY ESSENSYS

Selected by:Michel Van Hemele

Selected by:Raf Jansen

Selected by:Peggy Van Sumere

Selected by:Michaël Bremans

Selected by:Marc Crombez

Selected by:Goedele Callaerts

Selected by:Chris Tempels

Selected by:Tony Geudens

Selected by:Bernard Tronel


Michel Van Hemele Managing Partner

EXECUTION IS THE STRATEGY

PROFILE Michel Van Hemele has served as Managing Partner of Essensys since the company spun off from Ernst and Young in December 2004. He advises clients during critical stages of corporate life, i.e. large-scale change projects, major business developments and restructuring programmes. He coaches temporary managers on efficiency improvements and change management assignments. Up to 2014 he was International Management professor at the Faculty of Economics and Management of HUBrussels / KULeuven. Prior to 2004, Michel Van Hemele served as CEO of Carestel and as CEO of Solvus. He is chairman of the board of Brewery Duvel Moortgat, board member of Delta Lloyd Bank and several European growth companies.


What, for you, is the core message of Laura Stack for the entrepreneurs of today?The title of this book can be a bit confusing, but we have known for a long time that ‘a brilliant strategy, poorly executed’ gives much poorer results than ‘a decent strategy, brilliantly executed’. Laura Stack describes the importance of the good implementation of a strategy. I believe that a good implementation is frequently underestimated. A good implementation implies being logical and consistent. In other words not changing direction halfway through the implementation, or widening the scope of the strategy bit by bit. The implementation of a strategy is linked to the company culture, but is also influenced by material culture. In western Europe we sometimes deal with things in a different way, and you have to take that into consideration as an entrepreneur. The same applies to each company: the work does not stop with a creative idea.

Stack’s reasoning is based on the observation that companies like working with three or even five-year plans, that this type of approach no longer works, and that they have to focus on the ‘here and now’. Agreed?Stack constructed a model that helps you create added value in the longer term, the LEAD model: Leverage, Environment, Alignment and Drive. You do not have to follow the model slavishly, you can introduce your own priorities. What is relevant, however, is the ingredients that she provides for her success formula: attracting the right resources, fostering the correct company culture, making employees feel

“Preferably a decent strategy,

brilliantly executed.”

Michel Van Hemele


they have ownership of their result areas and creating a flexible organization. The top management, the teams and the employees have to be flexible enough to make advances, to progress and to realize ‘small wins’ in all fields.

That demands that top management occupy a different role?The approach proposed by Stack fits well into small and medium-sized companies (SMEs), because she puts the emphasis on the role of the CEO as an active team leader. The CEO is no longer the boss, but the person who makes a good implementation possible. To put it in football terminology: the CEO is neither the president of the football club who makes the policy, nor the coach who draws up the strategy, but the captain of the team who, together with his co-players, realizes the implementation on the field.

A new breed of CEOs? In the past the leadership of the CEO was strongly based on his positional power from which a command-and-control leadership was possible. Today, employees expect collaborative leaders and, for that, the book offers a good basis, especially for SMEs.

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HOW LEADERS ACHIEVE MA XIMUM RESULTS IN MINIMUM TIME

EXECUTION IS THE STRATEGY

The first role you need to function in as a leader is to be an engineer and build your organization’s capacity to execute. You do this by attracting great talent, by providing your people with opportunities to acquire better skills and by securing the resources they will need to perform at a high level of effectiveness.

If you visualize a lever, it will look something like this: What you’re trying to do as a leader is to make sure your people know what the mission is, have everything they need in the way of resources and then work with them to fine-tune so you get maximum bang for your buck. As a leader, you work for your team and not the other way around. You serve as a nucleus and a catalyst. In many ways, the job of the modern leader is to get out of people’s way and let them succeed rather than barking out orders or attempting to micro manage everything that happens.

If you can maximize your input into the lever, it stands to reason you will also maximize the impact of the results which eventuate. One way to do that is to take a HANDS approach:

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H andpick your people – bring together teams which have the right blend of skills and experience.

A ssign duties carefully – make sure everyone understands what they are responsible to accomplish.

N urture initiative and innovation – encourage everyone to find better ways to get things done.

D on’t abdicate responsibility – just because you delegate doesn’t mean you’re out of the loop if people fail to deliver. Be responsible for what is produced.

S tudy the results – analyze what’s being generated and keep fine-tuning and improving along the way.

Today’s most effective bosses are not control freaks. When you become one, you crush creativity, drive depression and kill camaraderie. Instead of micro managing, you need to be trusting your people and getting behind their efforts to be productive. Instead of barking out orders, you need to become a good communicator.

You do this by: Listening to what your people are saying and putting aside the fantasy you know better than they do.

Talking with everyone who interacts with customers. Delegating and making everyone part of what’s happening. Setting a good example of doing hard work rather than arriving late and leaving early.

Rolling up your sleeves and getting involved during emergencies or when deadlines are looming.

“In the past, a leader was a boss. Today’s

leader must be a partner with their

people. They can no longer lead solely based

on positional power.”Ken Blanchard,

motivational expert

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Avoiding any tendencies to play favorites and instead installing a meritocracy where the best ideas and the best people have a chance to shine.

Treating your people with the dignity and respect they deserve.

The first place to look when trying to increase your organization’s leverage is in the mirror. You’ve got to make sure you’re putting in the effort and energy that’s required.

Once you’ve maximized your leadership input force, your next challenge is to strengthen and lengthen the beam – your team members. In practical terms, this simply means that you have to work to make sure you have the right people in the right places armed with the skills they need to get the job done. The more you can strengthen each team member’s ability to execute your strategy, the better. So how exactly do you do that? To strengthen the beam: 1. By all means look for talented people – but acknowledge being a hard

worker is more important. Talent certainly can provide a welcome edge but it will only go so far. Recruit talented hard workers for your team. You’ll be able to identify them by their attributes:

They will have stellar performance records. They will have a “get the job done” attitude. They will have sharp and well-defined goals. They’ll be openly ambitious and self-confident. They will have the ability to manage their time well.

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2. Do some intensive training and continuing education with your people – even if they are obviously technically competent. You should be providing ongoing training in areas like:

Legal and ethical matters. Technical proficiency. Personal and professional career development. Skills training.

3. Set up some effective mentoring programs – especially for your new hires. Place new team members with experienced people who can show them the ropes. Provide new team members with the training and coaching they need to get up to speed quickly. Use mentoring as a productivity accelerator for your organization.

Once you’ve strengthened your own input as a leader and done all you can to maximize the impact of your people, you then have to figure out how you will improve the fulcrum. The fulcrum is the hinge or pivot the beam acts against. For a business, the fulcrum represents the performance enablers which are the resources your team have available to them. It usually goes without saying you will naturally want to equip your team to be successful. You do this by:

1. Providing employees with the right tools – laptops, smartphones, fast Internet connections, software, etc. You want to make sure your people have whatever they will need to maximize their productivity as team members.

“The business enterprise has two

– and only two – basic functions: marketing

and innovation.”Peter Drucker,

management consultant

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2. Provide employees with unrestricted access – to all of your resources and information assets so they can use them at a time that suits them best. Sometimes paranoid leaders restrict access to information or set restrictions which make everyone operate inefficiently. Don’t fall into that trap.

3. Outsource to experts – subcontract out your most time draining tasks to those who can do them better and you can generate some sizable productivity gains. Using the Internet, you can build working relationships with state-of-the-art suppliers anywhere in the world. Delegate to the global village and tap into the knowledge and skill sets of world-class suppliers for your own enterprise.

4. Building and developing new relationships with your vendors – so you can leverage their strengths for your own benefit. If you have vendors whose strategic priorities align with your own, you can take advantage of the relationships they have in place as well. That may enable you to multiply the impact of your efforts and create synergies.

5. Figuring out ways you can increase your team’s productivity on an ongoing basis – by doing small but obvious things like:

Identifying unnecessary tasks you can eliminate. Focusing on high-value tasks alone. Upgrading your software for better functionality. Buying next-generation computer hardware. Cutting back on meetings. Delegating more power to front-line teams.

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The whole idea with improving your fulcrum is to take a positive approach and to grow your competencies rather than being forced to cut back on staff, on salaries or on your quality levels. Find ways to enhance your organization’s productivity.

Next you need to be a mechanic and fix your culture (if necessary) so you have a successful and productive work environment. Ideally you want an environment where people “own” their jobs and feel responsible for the results they generate. You do that usually by empowering people to produce without oversight.

Your corporate culture matters for several reasons: It provides motivation for people to be doing the right things day by day and week after week.

Your culture allows employees to make independent decisions without having to consult you.

Culture gets everyone aligned with the same goals. Your workplace culture can and should foster an environment of innovation and excellence.

Most frequently, a corporate culture evolves over extended periods of time. It is the result of multiple decisions which get made. Fortunately, you can direct and influence its evolution. How do you do that?

1. Always have an attitude of excellence – refuse to accept shoddy work and insist your organization will stand for the best. Walk the talk and be a good role model in this regard.

2. Lay a solid foundation of accountability – that everyone must be prepared to accept credit for great work and blame when things go wrong. Make it clear all team members have to figure out how to make the right things happen and then follow through with corresponding actions.

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3. Emphasize teamwork and action – where people can team up and make great things happen. You want everyone to collaborate, to take calculated risks and to work together to make execution commonplace rather than the exception. You also have to make it acceptable for people to make honest mistakes and to learn what works by trying what does not work first.

4. Find ways to slash through the usual red tape – remove the bureaucratic hurdles. Make it possible for teams to take charge of projects on an as-needed basis and move them forward rather than having them come under the umbrella of committees.

5. Emphasize collaboration – where everyone works together. If you’re open in your planning and then let decisions get made by consensus rather than by decree from above, you signal that everyone’s opinion is valued and weighed up. Share the resources and get everyone working together and you can tap into all the talent you have available.

The only real constant that exists in business is ongoing change will happen. You’ll find waves of transformation flow through your organization all the time. In addition to building a vibrant corporate culture, you also have to equip your organization to be change hardy. To equip your organization to deal with change:

1. Never make changes just for the sake of change alone – but only make changes which are logical and helpful. Having a new leader come along and mix things up just to put their stamp on things is crazy. Make changes to move forward.

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2. Accept that change is inevitable – and therefore greet it with a great big bear hug. View it as an opportunity to learn and to grow. Stay calm and keep moving forward. Focus on the benefits and the growth which will come.

3. Use change to get better at what you do – to sweep out old inefficiencies and to exploit new and exciting opportunities. Take some calculated risks and push the envelope. You can tweak as you go along so be innovative and move forward.

4. Use change to spark your innovative thinking – always be on the lookout for quantum leaps you can take while changing. Incremental improvements are nice but you want to swing for the bleachers when you have to make a change.

5. Be prepared to bounce back quickly if required – or in other words be flexible. If you make a mistake, correct it immediately and move on. Try something different again. Ultimately, you’ll end up in better shape if you keep on trying new things over and over again.

The simple fact is you live in a dynamic world. Change is increasing rather than decreasing in scope and frequency. Most if not all of today’s big corporate success stories started out making very different products from what they offer today. If you refuse to change, you’ll end up like the dinosaurs. Keep evolving and rolling with the changes which are happening in the marketplace.

When your project has a lot at stake, it’s impressive how engaged and energized employees can become. If you can get your people to be at that level of motivation most if not all of the time, it stands to reason they will achieve more.

“If you’ve always done it that way, it’s

probably wrong.”Charles Kettering,

former head of research, General Motors

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The key to making that happen is to get everyone to take ownership of their work. Common-sense ways to ensure you have engaged and motivated employees are:

1. Encourage everyone to step up – by setting a great example of doing that yourself. Express your confidence in the competence of your people and give them the training they need to do a great job. Help them move to a higher level.

2. Give your people tangible reasons to try harder – in the form of opportunities for advancement, greater control, less oversight and peer acknowledgment. Show everyone how what they do connects directly with achieving your organizational goals. Offer monetary rewards, time off, praise and promotions if that’s what it takes to motivate. Vary your rewards from person to person to match their preferences and personality.

3. Be there for your people – provide multiple mechanisms for them to give you feedback on how they’re doing. Get down in the trenches with them rather than hiding at your desk. Follow Hewlett-Packard’s well-publicized approach and manage by walking around.

4. Empower your teammates – delegate your authority as far and wide as you can. Make it clear to everyone you appreciate them using their initiative to move things forward. Admittedly, you still will be ultimately responsible but engage their passion and their enthusiasm to good effect. Keep things simple so everyone can get involved.

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The dynamic that applies here is if you can get more employees to give you more of their best efforts, your productivity will skyrocket. Furthermore, the more engaging your workplace is, the easier it will become to attract more great talent in the future.

To lead effectively today, you will need to act like a conductor of a symphony. You’ve got to ensure what happens in your day-to-day operations aligns with and leads to the accomplishment of your strategic priorities. Command-and-control doesn’t cut it any more. You’ve got to help your people be more productive.

Ironically, the best way to accomplish more in today’s world is often to do less. To maximize your productivity, you have to cut back on less productive activities so you can spend more time on highly productive activities. Your job as a leader is to facilitate this kind of alignment.

To accomplish this, you need to handpick a small number of goals to work on. Get everyone focused on doing those activities well and leave everything else aside. For this to happen, there are three questions your team members are going to be asking:

1 Why should we care?

2 What is the goal?

3 How do we get there?

Answer those questions for the people in your organization and you’re well on the way to creating the kind of alignment which underpins great performance.

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If you can take your team on a mission rather than having them follow your agenda, they will be far more motivated and committed.

To get your employees to go on a mission with you: 1. Teach what your organization’s values and priorities are – get them to

know and feel why what you do is important. Educate your people in what you stand for so they can see the big picture perspective.

2. Show them definitively why what they do matters – and how their efforts fit into the overall plan. Be specific and spell out why their individual successes matter to the company. Form a direct line of sight between what they do each day and what your entire organization is aiming to accomplish.

3. Bulldoze obstacles out of the way – by setting specific goals and target dates and then letting people come up with their own ideas on how to get things done. Let people work to deadlines with all the creativity they can muster.

4. Get into the habit of accentuating the positives – of painting a pretty picture and then standing back and letting everyone go at it. You have to let people drive towards the goal without getting tangled up in a complex web of long-term plans which are outdated the minute they’re published.

5. Be comfortable with and acknowledge the churn – the fact what you’re asking will require extra effort and some people may prefer to find work elsewhere than put forth that kind of effort. Just remind everyone you’re focusing on a few priorities and not asking them to do a million extra things. Be willing to defend your priorities and enforce the choices that you’ve made.

At one time, leadership from on high might have worked. Today, you can’t sit at corporate headquarters issuing directives and expect everyone to automatically

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do their best work. You have to look your people in the eye and explain why what they do matters. If you can inspire them and get them to care, your enterprise can literally and figuratively move mountains. Most people dislike ambiguity. They prefer you to be crystal clear about your expectations. To plan for greater goal achievement: 1. Share your goals – in writing. Think everything through and commit your

goals to paper so everyone gets on the same page. Concisely articulate your mission, your values and your vision. By all means build in some flexibility but get everyone working towards the same objective.

2. Embed your goals within a strategic plan – which sets out what people need to be doing day-by-day to realize those goals. Clarity here makes it easier for others to get onboard.

3. Get everyone moving – and tell them to hold on tight. A simple way to do this is: Write a 3-year strategic plan which sets out what you’re trying to accomplish at a high level. This should fit on one page and is subject to change as the marketplace evolves.

Break your strategic plan down into an annual operating plan which can be executed by the management team.

Break the annual operating plan down into monthly operating plans which are highly measurable using specified metrics.

4. Strike a happy balance between being tenacious and letting go – in terms of when to focus on executing your plan and when to change things around to match changes in the marketplace. You have to be able to integrate changes into your plans quickly if needs be.

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Alignment is all about creating coherence – getting everyone and everything pointing in the same direction.

You create coherence by: Transparently communicating what your organization’s strategic goals are. Providing the training people need to do their jobs correctly. Checking in with people regularly to make sure they’re executing strategy effectively.

It’s vital that you use good metrics to measure your progress as an organization. Metrics get everyone on the same page in determining whether or not you are succeeding in executing your strategy. The big six business metrics are:

You have to be tracking these six key metrics all the time to determine whether or not you are executing your strategy. Don’t have excessive controls which can stymie innovation but make certain you have a good idea of exactly where you stand at all times. Once you’ve gone to the trouble of hiring talented people, don’t keep getting in their way. Let them go after your goals in the way they feel most comfortable with. Let them do things as they see fit. Have the approach your job is to offer a vision and guidance and their job is to make the right things happen. Let them get the work done. Also bear in mind there is a fundamental difference between strategy and tactics. You have to make sure you have the right mix of both strategy and tactics and educate everyone else on the distinction as well. If you can do that, then people won’t just be focused on the immediate task in front of them (tactics) but will

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also keep a weather eye on the profit horizon (strategy). Leadership is always a balancing act where you want your team to be running smoothly on day-to-day tactics without neglecting the need to plan your long-term strategy as well.

Accountability comes to the fore here. You want people to take ownership of their jobs and be responsible for their actions but the ultimate responsibility for everything that happens – good or bad – falls upon your shoulders as a leader. Step up to the mark and take up the challenge. After all, that’s why you get the big bucks.

To lead effectively today, you will need to act like a conductor of a symphony. You’ve got to ensure what happens in your day-to-day operations aligns with and leads to the accomplishment of your strategic priorities. Command-and-control doesn’t cut it any more. You’ve got to help your people be more productive.

To act like a bulldozer and build momentum for achievement, all you have to do is three things: Taking each of these imperatives in turn: One of the most obvious ways to make everyone speed up and achieve more is for you as a leader to identify and then eliminate any and all obstacles which prevent your team members from doing more.

You do this by: 1. Challenging your people to achieve maximum results in minimum

time – instill in everyone the need for speed. Look at all your systems and see what steps can be eliminated through greater flexibility and agility. Do everything you can to supercharge and build on what’s working well.

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2. Enshrine ongoing and continuous improvement as a standing goal – and encourage everyone to figure out how to achieve more with less. A lean mindset where you systematically eliminate whatever does not add value for the customer can work wonders. The more fat you trim away, the more agile your organization will become which is exactly what you want to happen.

3. Speed up your decision-making processes – replace slow and deliberate processes with a preference to act immediately. SPEED up decision-making by teaching everyone to:

Stop and gather data about the issue. Ponder what it will mean to your team. Educate yourself on impacts and consequences. Evaluate what you have learned. Decide your best course and implement it now. 4. Weed out groupthinking – where people go along with decisions they

know are wrong because they don’t want to rock the boat. Listen to everyone’s opinions, especially those who are at the coal face. Collaborate rather than letting the most assertive individuals dominate.

5. Avoid perfectionism – where people are afraid to get stuff out until it is absolutely perfect. Rather than do that, teach everyone to be a REALIST:

Recognize your limits. Energize everyone to do their best work. Acknowledge the reality you’ll make mistakes. Leave the pursuit of perfectionism aside. Implement your plans and take action now. Seize the initiative while it lasts. Take your best shot and be happy with that.

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Removing procedural obstacles is helpful but as a leader, you can and should be doing much more than that. You should also be drafting in more enablers all the time to help your teams achieve more.You can do this several different ways: 1. Urge your team members to employ the THINK methodology – where

they better themselves and increase their personal productivity by: Taking care of their health. Honing their memories. Improving their capacity to focus. Nourishing their brain with new facts and ideas. Knowledge expansion. 2. Make sure your technology is up-to-date – and that you’re not handing a

competitive advantage to others because you persist with outdated technology. For example, health care record keeping has gone electronic and that means more time can be spent analyzing the data and less time gathering it. Communications advances are reaching every nook and cranny of the economy. To be up-to-speed, you need to have fast computers, the right software, quick Internet connections and even simple things like double monitors. Get everyone familiar with instant messaging, webcasting and video conferencing. Make sure everyone have the best technology tools that are available now.

3. Triage the non-urgent tasks – and trim away anything that is not contributing to your strategic execution. If you’re being slowed down by an out-of-date strategy or by previous-generation attitudes, take an axe to them. Don’t take on sideline projects just for the sake of making a buck. You may find that loss of focus and drive is far more expensive than you have factored in. Your team’s time is limited so clear their calendars of the marginal value projects so

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they can move forward without restrictions. You’ll be amazed at how much time you can free up if you just make a serious effort to abandon any tasks which are not aligned with your highest priorities.

4. Make certain all your communications are clear and concise – because it’s amazing how poor communication can gum things up and derail productivity. If you can keep your messages as clear as possible, you open up possibilities for more people to get involved. Be straightforward in what you say. Avoid jargon. Acknowledge immediately when you receive a note from others and get them to do the same. Just these simple things will be helpful and worthwhile.

The average worker spends an alarmingly large proportion of his or her day doing things which contribute absolutely no added value. Time wasting – whether deliberate or not – varies from day to day but it is all pervasive. If left unaddressed, time wasters can drain your productivity and kill your forward momentum.So what can you do to weed out these time wasters and sneak in more productivity?

Some suggestions: 1. Start by rooting out procrastination – which is often the greatest time

waster of all. Figure out why you procrastinate and you’re halfway there to addressing it. Are you overwhelmed, afraid to fail, afraid you’ll run out of work – or what? Throw out these bogus excuses and get busy doing something productive.

2. Make a list of what-not-to-do – so you can decide quickly what to do next whenever you finish a task. Keep in mind what you should be doing to be productive rather than deciding what to do next based on what you feel like, who is making the most noise or whatever else comes to mind. Take action by deliberate design, not by default.

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3. Prioritize constantly and consistently – always have a list available of high-value tasks and activities you can be doing right now. If you keep a to-do list, rewrite it every day with your high-value items at the top and your low-value items at the bottom. Take every opportunity to let lower-priority items drop off your list entirely. Practice enthusiastic and purposeful abandonment of low-value items. And don’t forget to look for things you can do in parallel to speed things up as well.

4. Limit your meetings – both in terms of people who attend and frequency. Endless and pointless meetings are the bane of the workplace. Making meetings productive isn’t hard, you just need to be disciplined about following a few guidelines: • Don’t invite people who don’t need to be there. • Always have an agenda. • Stick to your agenda. • Make decisions and get back to work.

5. Cull out interruptions – so everyone can focus on productive tasks. Give people time and space to think strategically. Provide cubicle doors and turn all your desks away from the door and passageways. Some workers find noise-cancelling headsets work well, others will prefer different approaches. Give your workers time to be strategic.

6. Get everyone to embrace a sustainable work/life balance – where they work long enough to get things done but not so much they don’t have time for other interests and family. If you can set deliberate limits on work time expectations, you won’t reach the point of diminishing returns. Establish sharp boundaries between work and other things so people don’t become exhausted and overextended.

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MAIN IDEA At one time, companies used to draw up 3-year and 5-year business plans with impunity. That approach simply won’t fly in today’s business world. Flexibility and agility rule – and business leaders have to trust their front-line employees will be able to choose a strategy that will work in the here and now.

The key to success today is not how many good ideas you have but how many you manage to execute. From a leader’s perspective, there are four elements which must be in place for your organization to execute strategy effectively: Leverage – you need to have people and systems in place which will allow you to execute your strategy effectively. Environment – you need a corporate culture and workplace which supports your strategic priorities. Alignment – your people’s daily activities need to be contributing to the accomplishment of your goals rather than working against that. Drive – you need teams of engaged and motivated employees who are agile enough to seize new market opportunities.

Execution has become the true strategy for most businesses today. It’s not what you know or even what you have that counts any more. What you do is your business strategy.

“Strategic planning is so yesterday, but execution is always in style. Execution really is the strategy that will propel your organization forward in today’s fast-paced business arena.” – Laura Stack

OVERVIEWTitle: Execution Is the StrategySubtitle: How Leaders Achieve Maximum Results in Minimum TimeAuthor: Laura Stack Publisher: Berrett-Koehler PublishersPublished: 2014Pages: 262


SELECTED FOR

YOU BY ESSENSYS











Chris Tempels Partner

THE AMAZON WAY

PROFILE Chris Tempels has been associated with Essensys since October 2005 and has become a Partner since 2009. He advises companies, private equity firms, etc, mainly on strategic and operational matters including the improvement of their financial and operational performance. In order to reduce the threshold for SMEs, Chris is accredited by the Flemish Government. He also coaches temporary managers during their assignment or change and improvement related project (operational, financial, ICT, sales & marketing,…). In 2014 he was the initiator of the launch of a new business unit at Essensys focusing on operational excellence and continuous improvement. Furthermore he advised several entrepreneurs and management teams of SMEs as freelance advisor for the KMO Excellence and KMO Entrepreneur program at Vlerick. For 3 years, he was a member of the Board of the Executive Committee of Febelhout, the current Fedustria, and is currently still acting as a member of the Board of Intys HR. Chris maintains a vast network at senior level within large national and international companies, including public organizations, in Belgium.


Why should we read this book about Amazon?I personally found it interesting to discover what the ‘entrepreneur principles’ are of the company that belongs to the iconic figure that is Jeff Bezos. In addition, I wanted to know more about the way that Bezos has been able to transform the retail world so disruptively, simply from the idea of ‘single store sells everything’ and the use of Internet technology.

Can the Amazon way of working be transferred to Europe, just like that?That is not evident and the problems in Amazon’s logistics centre in Germany that were reported in the media prove that. Amazon works according to principles that are very strongly focused on results. Nobody will deny that Amazon is very innovative and market-oriented. However, the company’s culture is less people oriented, so you could ask whether this business model is tenable in Europe. The low educated are regarded as a pure production factor and there is probably too little attention to the work/life balance. Does everyone stay motivated; is everyone prepared to go that ‘extra mile’?

Is it, in fact, realistic to lead a company on the basis of 14 strict directives that are almost dogmas?Amazon puts a lot of emphasis on higher management with difficult selection procedures, A-players and ‘gold carrots’, so very top-down oriented. Nevertheless, they succeed in continuing to grow. I suspect that there is less attention paid to the lowest ranks.

“At Amazon there is a strong

emphasis on being self-critical.”

Chris Tempels


Each company is different and you cannot simply copy the company culture of a company, certainly not if there are imperfections. But on which points can European companies learn from Amazon?In the field of customer focus. Start from the client and then look backwards: that is a way of working that is still too uncommon with us. Here people are much faster to firstly scrutinise the internal structure. Also the attention to ownership and accountability is interesting. At Amazon there is a strong emphasis on being self-critical. People attempt to question everything and to simplify things where possible. We are still more often inclined to make matters more complicated. Amazon combines low costs with the highest standards.

What’s also typically American is that failures are allowed…...on condition that you learn from it, otherwise it’s pointless. That attitude dovetails into Amazon’s long-term strategy, with attention for positive cash flow instead of margins. That long-term strategy is too frequently lost sight of, both here and in the United States. Amazon’s top priority is market share, even though that might lead to losses for a while.

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14 LEADERSHIP PRINCIPLES BEHIND THE WORLD’S MOST DISRUPTIVE COMPANY

THE AMAZON WAY

1 | Obsess over the customer

1 | ConnectLeaders and managers at Amazon always start with the customer and work backwards. While they watch competitors, they obsess over their customers.

The real genius of Amazon founder Jeff Bezos is his ability to mentally picture himself as the customer, identify his unspoken needs and wants and then develop a system that will meet those specific needs better than anyone else. This approach underpins everything Amazon does – it puts the customer first.

The two truths about customers Jeff Bezos always preaches are: 1. When you make a customer unhappy, he or she will tell lots of people about it – so

don’t. 2. The very best kind of customer service is no service at all – everything just works.

That’s why instead of pumping money into advertising, Amazon has always tried to come up with ideas which its customers will love. For example, in November 2000, Amazon launched its “Free Super Saver Shipping Offer.” It was originally going to be just for orders over $100 but it generated so much word-of-mouth endorsements

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Amazon extended it. At the time, this looked like a wild and risky strategy but today customers expect free shipping and more.

Jeff Bezos has stated many times he doesn’t really worry about the margins Amazon enjoys. Instead, he’s trying to generate free cash flow to fund future growth. He’s trying to harness the flywheel effect to drive Amazon’s sales growth towards levels which have never before been achieved. He talks about how an improved customer experience and customer growth feed each other in a virtuous cycle that looks something like this:

Growth

Traffic

Selection and Convenience

Lower pricesLower costs

Sellers Customerexperience

Every time Amazon has moved into new markets, critics doubt it will work but it does. The company’s mantra is based around what it terms its holy trinity: “Offer a wide selection of goods at great prices and with fast, convenient availability.”

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Amazon has built its entire business model around this holy trinity: Price – Amazon’s low-price strategy is so well documented everyone understands what they’re trying to do. For more than 20 years and counting, Jeff Bezos has demonstrated he is willing to make less on an item in the short-term in order to guarantee the long-term growth of the business. He is confident the Internet is still at an early stage of development and will reach unimaginable heights and reach in the future. He is for the long view. Selection – Jeff Bezos has always categorically stated he wants to make Amazon a source for anything a customer may want to buy. He is on record as wanting to make Amazon “the everything store.” What Amazon doesn’t sell itself, he wants to make available through Amazon’s third-party marketplace. Availability – whenever Amazon takes a customer order, it specifies the projected delivery time. (This is known internally as “the promise.”) The company will go to extraordinary lengths to honor the promise, even if it costs Amazon money to do it.

Amazon removes from its website any products which are of inferior quality, which get delivered late or give the customer any reason to be disappointed. Doing that demonstrates definitively the company is totally focused on customers, both internal and external. Amazon extends this philosophy to the third-party vendors using its platforms as well.

Jeff Bezos is famous for bringing an empty chair into meetings as a constant reminder the customer needs to be acknowledged and heard. All Amazon managers are also required to attend two days of call center training each years and Jeff Bezos himself mans the phone at Amazon on a regular basis. The end result is the voice of the customer is heard even in the senior executive team of the company.

“There are two ways to extend a business. Take

inventory of what you’re good at and extend

out from your skills. Or determine what

your customers need and work backward,

even if it requires learning new skills.”

Jeff Bezos

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2 | Take ownership of results

Leaders at Amazon act like owners. They think long-term and never say “That’s not my job.” They always act on behalf of the entire company.

Jeff Bezos is the perfect role model for approaching every business situation like an owner rather than a renter. He still owns about 20 percent of the shares in Amazon and thinks in terms of years and decades rather than this quarter’s results. He is perfectly happy to place long-term bets and then to nurture them to maturity. So how does Amazon balance long-term commitments with the need for short-term results? A few of the initiatives Amazon uses are:

1. Amazon tries to hire the right people – to recruit and retain high performers.

2. Amazon instills a sense of accountability – by using what is termed “the open kimono” philosophy. In essence, this means you have to be brutally honest about your project’s faults, errors and limitations as well as its successes. When Bezos asks for a report on a project, all he wants to hear is: Here’s what didn’t work. This is why it didn’t work. This is what we’re going to change.

3. All workers learn pretty quickly the prevailing mindset at Amazon is: “Yes, it is your job” – and therefore they become proactive about solving problems rather than anticipating someone else will do it. If employees see something which will impact on the customer experience, they are expected to fix it right away without asking permission.

“We know our success will be largely affected

by our ability to attract and retain a motivated employee base, each of whom must think like,

and therefore must actually be, an owner.”

Jeff Bezos

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4. Amazon’s workers also identify and tenaciously manage their dependencies – they try and build in some wiggle room so if things go awry, the company can still deliver on its promises to customers. This philosophy also includes managing your team and mentoring them. Success in mentoring is one of the key metrics looked at during annual employee evaluations.

5. Amazon’s compensation plan rewards long-term thinking – inasmuch as employees typically get stock options rather than lavish salaries or excessive perks.

3 | Invent and simplify

Leaders at Amazon innovate fearlessly to simplify processes. They look for ideas everywhere and avoid “not invented here” thinking.

Amazon.com currently sells more good online than its 12 next biggest competitors combined. Furthermore, its sales are growing faster than Internet sales as a whole. How does it achieve that?

Amazon innovates at scale. Employees are expected to design and build new innovations which will make things better for millions of customers and tens of thousands of partners. At Amazon, your job is never just to maintain the status quo. You’re expected to figure out ways to enhance the customer experience and/or lower costs. This mindset even extends to Amazon’s engineers who consider themselves as problem solvers rather than coders. Everyone is trying to come up with genuine game changers rather than temporary fixes.

“Amazon.com continues to grow by inventing

and simplifying every day.”

Jeff Bezos

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Amazon’s business platforms are enablers first and foremost. They enable people to write and sell books, to sell to Amazon’s customers, to harness Amazon’s technology and to piggyback on Amazon’s computing power. By making these platforms available, Amazon grows through self-sustaining virtuous cycles.

Interestingly, Amazon always designs its platforms from the user backwards. Policies, rules, procedures, algorithms and technology are all simplified to create a seamless user experience. The question that gets asked and answered is always: “If I had to completely automate the process and eliminate all manual steps, how would I design it?” Invent-and simplify is the ideal antidote to creeping bureaucracy. For example, Amazon’s approach to performing the essential tasks which it needs to perform but which computers cannot handle well has often been to motivate its own customers and partners to do them. Customer feedback is used to identify offensive or irrelevant product images. Customer reviews of products means that Amazon doesn’t have to employ writers to do the same tasks. Using other people’s work to good effect not only benefits Amazon but also increases customer engagement.

As Amazon learns how to do more things, it has regularly created platforms and made money by offering those same capabilities to others. This modus operandi has been repeated over and over and is a key driver of Amazon’s ongoing growth. Inventing a platform and keeping it simple has seen many of Amazon’s in-house businesses flourish. For example, Amazon Web Services generated $3.8 billion in revenue in 2012 and is valued at $20 - $30 billion as a standalone business.

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4 | Leaders are right – A lot

Amazon’s leaders define their goals clearly and then use metrics to establish whether they are right. They don’t make the same mistakes over and over.

There is an implicit understanding that Amazon’s leaders will be right far more often than they are wrong. If they do fail at anything, they are expected to learn from their mistakes, develop insights from those mistakes and share them with the rest of the company so the same mistake doesn’t get recycled over and over.

PowerPoints are not allowed at Amazon management meetings. Instead, leaders are required to write out their ideas in a two-page narrative. Then, at the beginning of the meeting, that two-page document is handed out and everyone sits quietly reading it before discussing the idea.

To further clarify an idea, Amazon leaders also develop and articulate project vision statements in the form of “future press releases.”

A future press release is a short, simple and clear statement of how the project will be viewed if it achieves its aims and objectives. It is imagined this is what will be written once the project has come to fruition and as such will describe what was developed, why this is important to customers and what goals were achieved. The future press release forces you to outline your metrics and the principles which will lead to your success (hopefully). It also forces you to clarify what your goals are in clear and unmistakable terms. It’s a useful tool for making that happen.

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There is no hiding your successes and failures at Amazon. People know the metrics by which they will be held accountable. They either beat their number or they did not. Metrics and results are all that count, not intentions. By being numbers-driven in this way, bureaucracy melts away, internal politics fade to irrelevance and a genuine meritocracy emerges where the best ideas win. Every leader can answer with precision the very basic question: “Did I have a good day today?” At Amazon, leadership-by-the-numbers works. This is why the company is constantly developing new and better dashboards to measure its real-time performance.

5 | Hire and develop the best

Leaders at Amazon try and raise the bar with new hires. They recognize talent, coach others and willingly move great talent around the organization.

Amazon’s hiring process is famous for its rigor. Its not unusual for potential new hires to go through twenty or more interviews over a five- or six-week period before a Yes/No decision is made. And not only is it hard work for the person seeking the job. The people who do the interviewing are also required to file extensive notes on their impressions, along with a Yes/No recommendation. Those notes are then available immediately to the next-round interviewers to pick up on potential concerns and probe in more detail. In the early days, Jeff Bezos personally signed off on every new hire. That’s no longer feasible so he created what he called Amazon’s “Bar Raisers.” The bar raiser is the last line of defense to ensure the company is hiring smart people. The bar raiser’s job is to ensure the next hire increases Amazon’s collective IQ, capability and capacity. The bar raiser has veto power over any potential new hire. He brings a fresh set of

“Five years after an employee is hired, he

or she should think: ‘I’m glad I got hired

when I did, because I wouldn’t get hired now.”

Jeff Bezos

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eyes and an unbiased perspective into the hiring process and ensures the company is recruiting top talent. It’s considered quite an honor to be appointed as a bar raiser and appointment is made based on the success and retention of the hires you’ve made in the past.

Once someone gets hired at Amazon, they are expected to become A-players. The company is entirely comfortable letting go B- and C-grade performers. Amazon’s compensation policy is to pay relatively low salaries but substantial stock options. The vast majority of those stock options go to the A+ contributors with only crumbs going to the B and C performers. That, combined with a lack of advancement opportunities, means the B and C players get the message and head elsewhere. It also ensures there is a strong sense of ownership amongst Amazon’s employees.

6 | Insist on the highest standards

Amazon’s leaders set unreasonably high standards and then keep pushing for more. They drive everyone to fix problems and deliver ever-increasing quality.

Amazon expects every employee to think and act like a leader. When that happens, it forces everyone to keep upping their game and doing more. It becomes a force multiplier for the company.

To ensure that happens in practice, Amazon uses “service level agreement” or SLAs. An SLA specifies the inputs, outputs and metrics which will be used and the precise standards to which a particular service will be held. In short, SLAs define expectations for all services which Amazon provides to internal and external customers.

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For example, Amazon has an SLA which states the load time for the worst performing page of the website must be three seconds or less and must be experienced by customers no more than one tenth of one percent of the time. (Amazon’s metrics show for each 0.1-second delay, there is a 1 percent drop in customer activity.) This SLA clearly and concisely specifies how the website must perform. These SLAs are then reviewed every week. The root causes of any failures are analyzed and discussed. Planned fixes are agreed and then tracked to see what happened. Amazon tracks all this detail in real-time and makes the results available to its managers. That gives the senior leadership team a very clear picture of the organization’s overall health. As might be envisaged, these SLAs are vigorously debated inside the company.

SLAs and the rigorous way they are tracked are reflective of Amazon’s culture of metrics and performance. Basically everything is tracked and analyzed and then progressively improved upon. The company also tries to do everything at breakneck speed which creates a startup mentality. Amazon sets absurdly high standards and then works like crazy to make them happen.

The reason for Jeff Bezos to keep pushing is abundantly clear. In 2012, the Amazon.com website went down for 49 minutes costing Amazon about $5.7 million in sales. That’s why Jeff Bezos keeps driving everyone to perform. The stakes are high.

That’s also why Jeff Bezos insists everyone act like an owner. To thrive at Amazon, you really do have to adopt a long view in everything you do. You have to feel like you’re part of something which is changing the world or you won’t survive.

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7 | Think big

Leaders at Amazon keep looking for bold new ways to serve customers better. They think different and go confidently in new directions.

Jeff Bezos is considered to be one of the big success stories of e-commerce but in his own mind, he’s just only just getting started. He believes the Internet is still at Day One of its development and exciting times lie ahead. To keep up with him, you have to be prepared to “go big in your thinking or go home.”

Since its inception, Amazon has never put short-term profits ahead of value creation and long-term growth. Helping Amazon maintain low margins is a non-negotiable as far as Jeff Bezos is concerned. If you want to compete with Amazon, you have to beat them on value – which is extraordinarily hard to do.

Jeff Bezos introduced the term “free cash flow” to sum up what he is trying to achieve with Amazon’s business model. Free cash flow or FCF is the primary financial measure Amazon itself uses.

To think in terms of FCF, Amazon uses this kind of approach: Start with your gross cash flow and subtract capital expenditures. This gives you your FCF. That FCF represents the amount of cash you have available to create new businesses, invest in more technology to do things better, pay down debt or launch new businesses.

“Don’t be afraid to fail; some of the best

ideas at Amazon have emerged from the

ashes of defeat.” John Rossman

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FCF also fuels the ongoing innovation whichAmazon requires in order to keep growing.

While Amazon’s investors may complain this approach neglects paying them dividends (something Amazon has never done or even really considered), it allows the company to continue building and expanding what is one of the most dominant enterprises in the world. Free cash flow has enabled Amazon to survive while many other Internet companies rode the boom times and then collapsed. In Bezos’s view, they put too much emphasis on short-term profits and not enough on long-term value creation.

There is one other philosophy which Bezos instills in Amazon employees. He terms it his “regret minimalization framework.” It goes something like this: Imagine you’re 80 years old. As you look back on your life, what do you regret not doing or not trying? Get busy doing all those things right now so when you really do get to age 80, you won’t have those regrets.

8 | Have a bias for action

Leaders at Amazon favor taking calculated risks. If in doubt, try something new and see if you can take advantage of first-mover opportunities.

Amazon’s leaders err on the side of taking action. They try new things all the time rather than suffering from analysis paralysis. There is a high tolerance for initial failure in doing something new as long as the same mistakes don’t keep getting repeated again and again.

“Take a long-term view and the interests

of customers and shareholders align.”

Jeff Bezos

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Amazon’s real secret sauce in making this work is everyone learns how to develop and use smart metrics. Since many of the company’s processes are automated (making them clear and transparent), leaders who are trying something new can get good data about what’s happening. That data will tell you quickly whether what you’re trying is working or not.

To encourage people to take risks and do new things, Jeff Bezos and Amazon do several things:

Every quarter, the company holds an all-hands meeting at which the “Just Do It Award” is presented. The award itself is an old tennis shoe which has been mounted and bronzed but getting it is highly coveted. The “Just Do It” goes to the employee who has a bias for action and who exemplifies ownership, frugality and self-starting. Amazon also gives out “merit badges” which are highly visible icons in the company’s intranet and internal phone directory. These merit badges are proudly displayed to all the world and signal the recipient is highly innovative.

In these and other ways, Amazon actively sends the signal to its employees that it’s OK to take smart risks and then learn from the results. Jeff Bezos respects the fact leaders sometimes need to follow their gut instincts and do things in the absence of detailed market research. The key is to use good metrics to keep track of what’s working and what’s not.

“If you never want to be criticized, for

goodness sake, don’t try anything new.”

Jeff Bezos

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9 | Practice frugality

Amazon’s leaders don’t spend money on things that don’t matter to customers. Frugality is good – it breeds resourcefulness, self-sufficiency and innovation.

Amazon is very deliberate about keeping its costs low. The prevailing logic is every dollar saved is another dollar which can be used to invest in and grow the business. The low-cost philosophy flows and is executed from the top down.

Bezos has always been adamant Amazon would not have an elaborate corporate headquarters. To drive that message home, he fixed on the “door desk” – hammering legs onto a door to create a desk. Door desks became the symbol of the low-cost culture Bezos was trying to create for Amazon. Today, the company hands out the “Door Desk Award” which acknowledges employees who come up with ideas that save the company money and therefore lead to lower prices for customers.

Jeff Bezos himself leads the charge in searching for new opportunities to create fresh symbols of frugality. At the annual shareholder’s meeting in 2009, he noted light bulbs had been removed from the vending machines in Amazon’s staff cafeteria. Bezos had found the company was spending tens of thousands a year on electricity to make someone else’s advertisements more attractive. He was delighted to be able to eliminate that cost.

Admittedly, frugality can have a downside. If you’re not careful, you can inadvertently send a message that you don’t care about your customers or your staff. Many of Amazon’s ex-employees have stated the company’s cheapness was one

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of the reasons they quit. Others consider Amazon’s practice of hiring temporary-contract workers leads to low-quality work and inconsistent levels of service.

For all of that, however, Amazon is still considered to be the gold standard for customer service. That’s a pretty impressive achievement in and of itself and the company is certain to be focused on retaining that position while continuing to lower costs.

10 | Be vocally self-critical

Amazon’s business leaders don’t consider themselves to be above criticism. They benchmark their own performance against the best and fix problems.

Amazon’s leaders are incredibly self-critical. They are openly and intellectually honest about their shortcomings. They keep asking: “How can we get better?”

In Amazon-speak, this is referred to as being willing to “open your kimono.” Leaders at Amazon are expected to speak up when things aren’t going as planned. Doing that is easier than the alternative which is to try and cover things up and hope they go away. Whoever does that at Amazon will be shown the door.

Much of this mentality and ethos flows directly from Jeff Bezos. Everyone at Amazon knows what he is about – creating the ultimate online destination for anyone who wants to buy or sell anything at all. He is very much hands-on engaged in the journey and he expects every leader to share that experience with him.

“One of the only ways to get out of a tight box is

to invent your way out.” Jeff Bezos

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It’s a well-documented phenomena in the business world that successful companies ultimately decline thanks to hubris – where leaders become arrogant and see success as an entitlement rather than something to be earned every day. Making sure leaders are vocal about their faults and prepared to be self-critical is one of the tools Bezos is using to make sure Amazon never becomes arrogant.

The other tool which Jeff Bezos uses consistently well is he has Amazon’s leaders constantly scanning the horizon for potential threats. The company’s leadership team, for example, has recognized that while Google may look and act more like an ally at the present time, they are in fact a long-term threat to Amazon. Google are quietly but steadily developing capabilities which would enable them to migrate into Amazon’s space in the future. In response, Amazon has reduced its own dependancy on Google by bulking up its own search capabilities. Amazon is also creating Web destinations where customers can get to the Amazon website without going through Google. Bezos is keeping everyone focused on Amazon’s obvious blind spots.

In short, Amazon’s leaders have a healthy dose of paranoia. They engage in ongoing self-examination. They look for non-obvious threats and do something about them. They’re always on the lookout for improvements and ready to act on them. These are good practices to have happening and Amazon has benefitted tremendously as a result.

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11 | Earn the trust of others

Leaders at Amazon attempt to be open-minded, humble and to genuinely listen. Their openness empowers them to trust others and to earn the trust of others.

Amazon is a flourishing company filled with very bright people who are all on a quest to change the world. For all that, however, collaboration is needed. Sometimes that’s hard to make happen but at Amazon, it’s not unusual for leaders to work together without worrying about titles, organizational charts or official roles. Why? There’s a high degree of trust.

Amazon is famous for its concept of “Two-Pizza Teams” – having working groups of six to ten people who can be fed by an order of two pizzas. The real key to making two-pizza teams work isn’t to limit the size of the team but to give everyone autonomy and accountability. The two-pizza team as used successfully at Amazon provide ambitious leaders great opportunities to excel and a sense of ownership.

Much of what Jeff Bezos does and how he operates contributes to an atmosphere of trust at Amazon. Make no mistake that Bezos is very clear and outspoken when things go wrong but the company’s work environment does engender trust. Leaders earn their team member’s trust and reciprocate in kind.

“Invention comes in many forms and at many scales. The

most radical and transformative of

inventions are often those that empower

others to unleash their creativity – to

pursue their dreams.” Jeff Bezos

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12 | Dive deep

Amazon’s leaders get involved in the nuts-and-bolts details of every process. They stay connected and look for opportunities to solve problems as early as feasible.

At Amazon, ownership means accountability. Therefore, Amazon’s leaders understand and get involved in the nitty-gritty details of every project they work on. They also understand the metrics unerringly.

Partly, this is a reflection of Jeff Bezos’s own sense of curiosity. He is relentless in wanting to learn about new things and he actively encourages his managers to be the same way.

Whenever Amazon launches any new initiative, Bezos stays pretty close by and watches the data closely. He will be right there probing, questioning, asking questions and analyzing right down to the small details. That melts away the bureaucracy which stops other companies from making major steps forward.

The desire to dive deep rather than skim the surface of anything also aligns with why Bezos has banned PowerPoints in internal meetings. He wants to engage with people who know what they’re talking about rather than those who want to create an illusion of competence. This also aligns with having a culture of accountability and being data-driven.

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Amazon leaders are taught to use “The Five Whys” as a way to explore the cause-and-effect relationships of any problem.

Amazon has an annual planning exercise which starts in August and doesn’t wrap up until October. This is an organization-wide deep dive into what’s going on and where resources should be allocated in the coming year. During this planning, teams build six- to eight-page narratives of their current operations, growth opportunities and plans and resources needed to pursue those opportunities.

Those narratives are boiled down into two-pagers which get read by Amazon’s senior S-Team. Again, the first 15 to 30 minutes of the meeting will be a period of quiet while everyone reads the narratives followed by a detailed and far-ranging discussion. In this way, Amazon’s leaders can make decisions which are certainly deeper and better informed than those made by managers who have only a superficial grasp of the details.

This annual planning exercise is how Amazon gathers ideas from throughout the organization and then allocates its budgets. The process allows innovation to arise anywhere in the organization and then for the company to make well-informed big bets on its future. No decisions ever get made without everyone first doing a deep dive into the underlying details which will ultimately determine success or failure.

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13 | Have backbone – Disagree & commit

Leaders at Amazon have conviction – they are prepared to challenge what they disagree with. They then commit to what has been decided wholeheartedly.

Jeff Bezos describes Amazon’s culture as being friendly but intense. He expects people to challenge him and his ideas and demands robust conversations – a gladiator culture.

14 | Deliver results

Amazon’s leaders focus on delivering key outputs to the required level of quality and in a timely fashion. They take setbacks in their stride and rise to the occasion.

At the end of the day, the only thing that really counts at Amazon is results. You can just about get away with violating all of the other principles and if you deliver outstanding results, all will be forgiven.

As a parting thought, always keep in mind that the leadership principles are guidelines rather than a blueprint. You have to strike a common-sense balance rather than use them like a recipe for cooking a cake.

If you lean too much on any of Amazon’s 14 leadership principles in isolation, you can ruin the desired effect. To make them work, you need to use them all.

“Part of company culture is path-

dependent—it’s the lessons you learn

along the way.” Jeff Bezos

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MAIN IDEA Jeff Bezos and Amazon have fourteen leadership “secrets” which guide their decisions. What’s interesting is not that these secrets exist but that they actually get referred to every day and are applied in the real-world decisions which get made.Amazon’s leadership principles are:

OVERVIEWTitle: The Amazon WaySubtitle: 14 Leadership Principles Behind the World’s Most Disruptive CompanyAuthor: John Rossman Publisher: CreateSpace Independent PubPublished: 2014Pages: 164

1 Obsess over the customer

8 Have a bias for action

2 Take ownership of results

9 Practice frugality

3 Invent and simplify

10 Be vocally self-critical

4 Leaders are right – A lot

11 Earn the trust of others

5 Hire and develop the best

12 Dive deep

6 Insist on the highest standards

13 Have backbone – Disagree & commit

7 Think big

14 Deliver results

“These principles aren’t slogans printed on wall posters and coffee mugs. They are lived and breathed every day by Amazonians from the CEO on down. They are principles that other companies, small or large, may just want to adopt.”– John Rossman


SELECTED FOR

YOU BY ESSENSYS











Tony Geudens Partner

BE THE BEST AT WHAT MATTERS MOST

PROFILE Tony Geudens joined Essensys as Senior Advisor after managing companies of the Royal Pakhoed NV Group (now Vopak/AEX). He was also successful as senior interim manager before strengthening Essensys at the end of 2005. Recently, he accepted an offer to join Essensys as a Partner. His professional experience in General Management, his mastery of the Order-to-Cash cycle and his track record in Marketing and Sales have already proven to be an added value to a substantial number of Essensys’ clients and interim managers. Tony provides assistance to esteemed customers in co-defining the exact scope of assignments as well as to the core of Essensys’ senior executives throughout the duration of the projects. Tony is an active member of VOKA (Antwerp) Chamber of Commerce the ‘Maritime Circle of Antwerp’ (President 2008-2009) and the Insead- and Vlerick Alumni Associations. Furthermore he maintains a vast network of senior executives of large national and international companies (including non-profit organizations) in Belgium as well as abroad.


Wanting to be the best in what is really important. Are you interested?The subject of this book is very close to my heart. How can you qualitatively anticipate what your clients want? That is the formidable challenge we face at Essensys, but actually in all companies. For us that’s a two-edged sword: we have to know what the client wants, we have to deliver a quality product and, moreover, we involve a third party in this: the interim manager that we have working at the client’s for a while already. Have I learned much that’s new from this book? No.

Certainly all companies say they focus on their clients. How can you then create the difference?Through regular and closer contacts with the client. You have to sit down together with your client in order to define the exact scope of each assignment. Be sure to understand the challenge and the client’s expectations. For a number of producers of fast-moving consumer goods, that’s a very difficult exercise. But, most certainly, service companies do not escape from that approach either. If, at Essensys, we didn’t have a 100% focus on the client’s needs, each assignment would end badly.

Of course, the question that lies behind this is: do companies really focus on their client?Even in our profession we notice companies that boast being able to match online profiles. Some of these, however, are companies without formal interviews, candidate screening or reference checks et all. How on earth, then, can you say: we ‘focus’ on the client? Aside from that, there are lots of ‘would-be’ interim managers. Are they putting the client first every time? No, not really. They work in their own interest.

“Focussing on being the best for

your clients.”Tony Geudens


Everyone can think up examples from his or her own sector. The added value is often lacking. For this reason we keep our eyes open for this kind of management books, which again highlight the importance of customer focus, i.e. delivering ‘excellence’ for our clients. Because excellence, to me, is purely having the focus on what the client really wants and needs. No more, no less. It’s not by chance that we continue to support clients and interim managers during the entire duration of an assignment. It is absolutely necessary during an assignment to prevent yourself from being distracted from your main objective by other matters that could be tackled at the same time. That can be at the expense of what was requested in the first place.

Calloway suggests that, as a company, you should pick out 3 aspects of your operation that could make a difference for clients and to put every effort into them. Is that a good, concrete tip?Yes and no. Why not two or four? You always need to interpret a book like this with a modicum of common sense. You have to extract from it what could be of interest for your company. Calloway’s underlying message is: Do not think that you can be the best in everything. Pick out a few aspects that lie close to your core business and tackle them, and show that you are the best in these. The proof of the pudding is in the eating, even though certain actions can support that. At Essensys we focus on quality and work according to our written quality processes and procedures. These are regularly audited and certified which resulted in two quality labels issued by LRQA (according to Federgon criteria) and Qfor. In every sector there are ‘cowboys’; your customers need to know and get the assurance that you are not one of them.

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THE ONLY STRATEGY YOU WILL EVER NEED

BE THE BEST AT WHAT MATTERS MOST

1 | Get so good at the basics you’re cutting edge

Sometimes there’s a perception the winners in business are those who are doing the most things. That’s incorrect. The winners are the ones who do the important things. To keep your customers and get more, deliver more of what they want the most.

Loads of people espouse the ideas of “amazing” and “delighting” customers and doing things which are totally “unique” in order to “WOW” them. Those are all great ideas and would be good to achieve but when you get right down to brass tacks, there’s one question you should ask:

What about if we just concentrated on making a better product?

The reality is if you make a better product, customers will like that and buy more. You won’t need the marketing smoke and mirrors or anything else. If you have a product or service which is genuinely better, you will win in the marketplace.The simple dynamic is people buy what you offer not because of the marketing sizzle but because they want or need the benefits you deliver. They want what

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you offer so much they are even prepared to give you some of their hard earned money in exchange for your product or service. That’s something you should respect and be working to build on. In most cases, there are really just three or four things your customers are expecting when they buy what you sell. If you can do an extraordinary job on delivering those things, customers will love it and you’ll probably find your business will prosper. If, on the other hand, you get distracted into delivering other unnecessary bells and whistles, then you’ll lose out.

Your goal should be to get so good at the basics that you become cutting edge. To illustrate, look at the example of Zappos, the Internet shoe retailer which was acquired by Amazon. Zappos is one of the most talked-about companies in the business world. If you look at what they do particularly well, their secret sauce really breaks down into just three factors: Zappos has a wider selection of shoes than you typically find in a retail store. They have a huge range because they just store the shoe description on their Web site, not the shoes themselves. Plus they have very, very fast delivery systems in place. You place an order and the product shows up very quickly.

Zappos’ customer service is legendary. They will go above and beyond the call of duty to make the customer happy.

Any Zappos customer can return their purchases up to a year later no questions asked. That 365-day 100 percent satisfaction or return policy is highly impressive. It’s woven into the way the company thinks and acts.

What’s most impressive about the Zappos example is this company is often described as being “cool”, “forward-thinking” and “progressive” on the strength of selection, delivery, customer service and return policy. Admittedly, it’s how the

“Pressure is something you feel

when you don’t know what the

hell you’re doing.”Peyton Manning

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company executes on those ideals which counts but this is not rocket science. Zappos has become a case study for excellence on the basis of some pretty straight-forward concepts. The company is so good in these areas it is considered to be cutting edge.You need to do something comparable. The way to get ahead today (and in the future) is to figure out what your customers value the most and give them more of what they want. Put another way, you want substance, not flash. Rather than trying to find creative ways to complicate things, you need to deliver the basics and then get to work excelling in those areas.

2 | Find out what genuinely matters most to your customers

Deciding what matters most to your customers is highly subjective – it will vary widely from one group of customers to the next. It’s vital that you do this though. Until you know what matters most to your specific customers, you’re operating with one blind eye.

To deliver more of what customers want, you first have to ask them what exactly do they want. Don’t assume you already know the answers – get out and speak to your customers and figure out what they’re after. Once you understand that, you can then gear up to deliver more of what they value the most. Why are you in business? There’s no universal answer to that question, no template or formula which applies in all situations. However, there are a few approaches which have worked for other people and other organizations which you might consider.

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You could be in business to: Maximize profit – what matters most is whatever is the most profitable. You structure everything and make every decision so as to increase your profitability pure and simple. That’s the enduring measure of your firm’s success.

Make a positive difference in the world – you might be trying to serve a larger cause and to make life better for people. Profit might be welcome and necessary in order to help you achieve your main goal which is to make a positive difference in the lives of your customers.

Be number one in your field – which was the driving motivation which fueled General Electric for many years. Having a competitive spirit is fine and can be a powerful driver of achievement. If you’re going after the number one spot, you keep an eye on your competitors.

Satisfy the customer – you may be working on the basis if you take good care of your customers, they will take good care of your business down the line. You hope that word-of-mouth will drive and grow your business in the future.

Do quality work – you may be motivated by doing high quality work every time you deliver something to your customer. Doing a great job which your customers rave about may be the thing which gets your engine running every morning.

Grow the business – you might be trying to get bigger, either through organic growth or by making acquisitions. You might look at metrics like the number of employees and the number of products you offer as the measures of your success. Or growth in revenue and overall profitability might matter most.

Achieve consistency of performance – you could be focusing on performing exceptionally well every time you deliver something to your customer. Perhaps putting systems in place so you meet deadlines 100 percent of the time and execute exceptionally well are important. Professional sports teams are usually

“If I had one hour to save the world, I would

spend 55 minutes defining the problem

and only 5 minutes finding the solution.”

Albert Einstein

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striving to do this and thus they build their brands. You might be trying to do something comparable.

Continually improve – you might be trying to push the envelope and to get progressively better at what your firm does. If you are continuously at the cutting edge of your field, you will be innovating and responding to customer needs in all kinds of different ways.

Be happy or creative or fulfilled – sometimes being in business doesn’t come down to the numbers. Sometimes it’s a matter of the heart and you’re working hard because you love what you do. It’s the work itself that matters most.

The whole point is your motivation is what it is. There is no “right” or “wrong” answer here. Your approach to business and that of your competitors might be quite different. That’s perfectly fine as long as you think about this, clarify what you’re trying to do and then get to work on what’s most important to you. Business consultants talk all the time about: “The main thing is to make sure the main thing is the main thing.” Until you figure out what m

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