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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
The ultimate game-changer for reinventing strategy and igniting people Whether it was Alexander the Great or Lord Horatio Nelson, the management team at Toyota or Google, the indisputable alchemy of strategy, execution, and leadership led to each's phenomenal success. With years of experience assessing and developing executive talent, author Eric Beaudan examines the essence of such a dynamic mix, summed up as "Creative Execution," showing how organizations and individuals can attain, or reach for, unheralded levels of success. Profiling extraordinary leaders and the uncommon leadership tactics that are their hallmark, the book also includes proprietary research and firsthand experiences with clients across the globe, illustrating the principles of Creative Execution in action. * Details the five elements of Creative Execution, including fostering candid dialogue across the organization, spelling out clear roles and responsibilities, and taking bold action * Includes proprietary research, assessments, and case studies With tactics, strategies, and calls to action to help any organization shape and apply the dynamics of Creative Execution, this powerful one-volume manifesto will help any leader get in the trenches, learn firsthand the impact of their decisions, and restore ingenuity, cooperation, and a sense of collective commitment to the workplace.
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Seitenzahl: 422
Veröffentlichungsjahr: 2012
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Table of Contents
Title Page
Copyright
Dedication
Foreword
Acknowledgements
Introduction: Who Needs Creative Execution?
Katrina Wipes Out FEMA
Defeating Strategic Stall
Violent Roots
Get Ready for the Ride
Chapter 1: Alexander at Gaugamela
Alexander Comes of Age
The Persian Adventure
The Final Showdown: Gaugamela
Alexander’s Creative Execution Formula
Final Tally
Chapter 2: Nelson at Trafalgar
The Nelson Touch
Let Every Man Do His Duty
Creative Execution at Trafalgar
Nelson’s Thunderous Legacy
Moving Forward
Chapter 3: Yamamoto at Pearl Harbor
Japan’s Great Leap Forward: From Tsushima to Pearl Harbor
Creative Execution at Pearl Harbor
Reversal at Midway
The Final Curtain: Operation SHO
Pearl Harbor’s Legacy
Chapter 4: From Desert Storm to Iraqi Freedom
Iraq’s Tortuous Destiny
Schwarzkopf’s Gambit
Desert Storm Unleashed
Creative Execution Plays Its Part
Reversal: Iraqi Freedom
The Reprieve of the Surge
Iraq’s Legacy
Chapter 5: Creative Execution Marches East
Five Poison Pills
Fast-Forward
Chapter 6: Toyota’s Road to Supremacy
Toyota’s Rise to Power
Toyota’s Creative Execution Formula
Life at the Top: Toyota’s Creative Execution Struggles
Chapter 7: The Four Seasons Puts On the Ritz
Sleepless in Toronto
The Golden Rule: Sharp’s Secret Formula
Sharp Meets His Prince
How Creative Execution Powers Four Seasons
The Final Showdown
Creating the New Four Seasons
Chapter 8: Google Ogles Microsoft
How Google Got Its Groove
Is Making Money Evil?
The Googley Side of Creative Execution
The Facebook Challenge
Chapter 9: Creative Execution in Action
Obama’s Surge
Thomas Cook’s North American Turnaround
The Final Question
Chapter 10: Becoming a Creative Execution Leader
The Path to Creative Execution
Let Creative Execution Surge
Endnotes
Introduction
Chapter 1
Chapter 2
Chapter 3
Chapter 4
Chapter 5
Chapter 6
Chapter 7
Chapter 8
Chapter 9
Chapter 10
Supplemental Images
Index
About the Author
Copyright © 2012 by Eric Beaudan
All rights reserved. No part of this work covered by the copyright herein may be reproduced or used in any form or by any means—graphic, electronic or mechanical—without the prior written permission of the publisher. Any request for photocopying, recording, taping or information storage and retrieval systems of any part of this book shall be directed in writing to The Canadian Copyright Licensing Agency (Access Copyright). For an Access Copyright license, visit www.accesscopyright.ca or call toll free 1-800-893-5777.
Care has been taken to trace ownership of copyright material contained in this book. The publisher will gladly receive any information that will enable them to rectify any reference or credit line in subsequent editions.
The material in this publication is provided for information purposes only. Laws, regulations, and procedures are constantly changing, and the examples given are intended to be general guidelines only. This book is sold with the understanding that neither the author nor the publisher is engaged in rendering professional advice. It is strongly recommended that legal, accounting, tax, financial, insurance, and other advice or assistance be obtained before acting on any information contained in this book. If such advice or other assistance is required, the personal services of a competent professional should be sought.
Library and Archives Canada Cataloguing in Publication Data
Phillips-Beaudan, Eric
Creative execution : what great leaders do to unleash bold thinking and innovation/Eric Beaudan.
Includes index.
Issued also in electronic formats.
ISBN 978-1-118-35109-3
1. Creative ability in business—Management. 2. Organizational change— Management. 3. Leadership. 4. Creative ability in business—Management—Case studies. 5. Organizational change—Management—Case studies. 6. Leadership—Case studies. I. Title.
HD53.P55 2012 658.4′063 C2012-901354-4
ISBN 978-1-11835650-0 (ebk); 978-1-11835651-7 (ebk); 978-1-11835652-4 (ebk)
Production Credits
Cover design: Adrian So
Maps: Crowle Art Group
Cover printer: Friesens
Printer: Friesens
John Wiley & Sons Canada, Ltd.
6045 Freemont Blvd.
Mississauga, Ontario
L5R 4J3
www.wiley.com
Foreword
Every organization knows that its future—its success or failure—depends above all on its leaders. So it is not surprising that millions of words are written about leadership. But despite these words and the research behind them, leadership remains an elusive concept. There is no template for leadership. Even if we can list the world’s most famous leaders, recognising leadership potential is an art, not a science. In different circumstances, in different cultures and at different times, leadership qualities will be adapted in different ways.
One of the reasons why it is so difficult to define leadership—or to isolate the qualities that make for a good leader—is that leaders are like artists: they come in a bewildering array of shapes and sizes. Artists may be musicians, painters, or architects—they might dance or sing or write. Leaders may be consistent or mercurial, charismatic or low-key, kind or harsh. And leadership is practiced in such a bewildering range of organizations from businesses and governments to charities and sports teams.
With so many variations and contradictions, it is easy to resort to defining leadership in a circular way. We can say that a leader is someone who can take people with him or her, who can inspire action, who can get results. But saying this simply begs the question: Which qualities does a leader really need to achieve those things?
Eric Beaudan’s insight is to identify just five core characteristics and to illustrate them not by developing a theory or list of “competencies” but with examples of leaders in war and business. With the difficulty of defining leadership, these examples are more helpful than abstract definition. Eric’s stimulating account of very different military, business, and political leaders brings to life the importance of the five characteristics that he proposes as the qualities for effective leadership in the twenty-first century.
The leaders in this book are willing—even eager—to break rules. Battles are not won by generals who fight “by the book” and success in business or war usually depends on identifying new strategies. That, in its turn, requires the leader to persuade people to do unfamiliar things and gain the trust of large numbers of people. Warfare demands a mix of thought leadership and action leadership. Great leaders, whether they lead armies into battle or turn around a struggling business, develop novel strategies and then turn strategy into action.
That we live in a rapidly changing world is a cliché because there is no period in modern history when the world has not been changing in a way that seemed bewildering at the time. The great leaders of the twentieth century lived in turbulent times and succeeded mightily because they developed new ways of doing business and turned their ideas into reality. Now as the East comes to dominate our thinking, and as economic dominance seems to be slipping from the West, it is as true as ever that the winners in business will be those who develop bold strategies and are willing to be visible leaders who take judicious risks and defy the odds.
Although war—especially wars as long ago as those of Alexander the Great—seems far removed from business, the leaders in this book help to demonstrate the essence of the qualities that Eric identifies as core to any leader’s success. A leader in business—as in war—must develop a unique strategy, communicate it, determine who should do what, implement boldly, and be visible to those whom he or she has to take on this dangerous journey. The stories from Four Seasons, Toyota, and Google aptly mirror these requirements.
At Odgers Berndtson, our partners and consultants around the world have a special responsibility: to find and recognize leadership potential and matching them to organizations with different styles and challenges. We constantly advise boards, CEOs, and leaders of some of the world’s most fascinating private and public organizations on how to find and assess people to lead them into new directions. From our vantage point, I can tell you that leadership isn’t a lofty topic that only briefly emerges on organizations’ agendas. It is by far the single most important subject that consumes boards, executive teams, and decision makers as they respond to the massive economic and political shifts that have erupted around us.
Just as organizations know that their future depends on how well they select their leaders, so ambitious individuals know that they must develop leadership skills. They know that to rise to the top of their organizations, and to be successful when they get there, they must constantly challenge their own thinking and develop their leadership.
And so whether you’re the newly appointed CEO of a company wondering how to chart a course for the future, or steering a public-sector agency in an era of austerity and high anxiety, this book will help you set in motion the critical leadership decisions that will make you successful. There is a Creative Execution leader inside all of us, and there is an unbounded supply of opportunities and challenges around the world that require all of us to apply these leadership qualities.
Richard Boggis-RolfeChairman, Odgers Berndtson
London, United KingdomFebruary 2012
Acknowledgements
Many friends, mentors, colleagues and clients have inspired the writing of this book. For simplicity’s sake, I will acknowledge them in chronological order—to parallel the writing of Creative Execution.
The genesis of the book was an assignment I conducted for Gary McDonald when he was the CEO of Thomas Cook North America and implemented his SPF25 formula. I was introduced to Gary and his team by David MacCoy, our OD Practice Leader at Watson Wyatt Worldwide (now Towers Watson). David ended up moving to the UK for several years to pursue his executive coaching work with Thomas Cook and complete his Ph.D. Both David and Gary were generous with their time and feedback as I slowly fleshed out the book, and I thank them both for their support and insights.
While working at Watson Wyatt, I first met Bob Rosen, founder of a consulting firm based in Arlington, Virginia, called Healthy Companies International. Bob became a mentor and good friend, along with his partners Leigh Shields, Eric Sass and Jim Mathews. I partnered with Bob to start interviewing CEOs such as Issy Sharp of the Four Seasons, which lifted my understanding of what CEOs do to build great companies. Bob and I have written about dozens of CEOs around the world, including the former president of Toyota and Major-General Patrick Cordingley, who can be found in the book. Our interviews have been a great source of knowledge and inspiration, and are now co-published by Odgers Berndtson and HCI under the title CEO Spotlight.
Odgers Berndtson has provided the support to make this book possible, and I can’t thank our UK Chairman Richard Boggis-Rolfe and Canadian Chair Carl Lovas enough for their belief in this project. A special thanks to the partners in Toronto who have given me new wings since joining Odgers Berndtson, and have fueled the growth of our leadership practice: my mentor Paul Stanley, Sal Badali, Michael Mundy, Gillian Landsdowne, Sheila Ross, Carrie Mandel, Deborah Lucas, Ken Rutherford, Jane Matthews, Sue Banting, Rob Quinn, Penny Mirams, Margaret Campbell, Malcolm Bernstein, Tanya Todorovic and Roberta Chow. Jacqueline Foley in Canada and Robin Balfour in the UK were outstanding in their marketing support. Our other partners and consultants in Canada—from our offices in Montreal, Ottawa, Calgary, Vancouver and Halifax—are too numerous to acknowledge, but their support has been equally invaluable. My assistant Kristen, always patient and cheerful, managed my calendar around some pretty tight deadlines.
From the many sources who contributed to my research, I would like to single out Katie Taylor and Nick Mutton of the Four Seasons who graciously put up with my requests for interviews and information. The Four Seasons is a beacon for Canadian businesses which so often find it difficult to sustain their global success.
The wonderful staff at Wiley Canada, including my editor Don Loney, production editor Elizabeth McCurdy and copy editor Jacqueline Lee worked overtime to get the book in final form. Deborah Crowle did a terrific job rendering the battle maps. Special thanks to Paula Sloss who put me in touch with the team at Wiley to get the project started.
My parents, Jacques and Colette, nurtured my love of history and writing early on, and let me accumulate insane amounts of military books and model ships despite any evidence that this would do any good. I hope that the lessons in this book will inspire my children, Troy and Ashley, to better appreciate history, which they always muse about. I’m not sure how many times I uttered the sentence “Not now, Dad is writing”—but probably far too many!
My newfound life partner Theresa shared my excitement for this book, reading early drafts and sitting through my first presentation to executives in Portugal. Ana Loya and her team in our Lisbon office did a wonderful job organizing this event, and the executives who attended gave us unexpected encouragement. I’m looking forward to many more opportunities where we can share the power of Creative Execution with our clients and friends around the world.
Creative Execution in action: this map of the battle of Gaugamela shows the early action with the Persian attack on the Macedonian left wing, which Alexander ordered to hold. The Persian cavalry broke through the Macedonian lines and ransacked the Macedonian baggage camp in the rear. Meanwhile Alexander took his Companion Cavalry straight into Darius’s center and caused the Persian king to flee.
This map of the Battle of Trafalgar shows the two English lines converging on the French and Spanish Combined Fleet. Nelson’s bold approach became known as the Nelson Touch.
Despite the imminent threat of war, no one in the US Navy or War Department thought the Japanese would have the audacity to mass their fleet carriers within a two hour striking distance of Pearl Harbor, and execute a well-coordinated attack against the Pacific Fleet.
Schwarzkopf’s unique strategy in Desert Storm became known as the Left Hook. Schwarzkopf secretly moved US armored divisions to the west in order to hit the Iraqi Republican Guards on their flank. This move ended the “Mother of All Battles” in 72 hours.
Introduction
Who Needs Creative Execution?
We must be bold.1
—John F. Kennedy
Katrina Wipes Out FEMA
When Katrina made landfall near New Orleans on August 29, 2005, no one believed that the Category 5 hurricane was about to become one of the worst natural disasters in U.S. history. The city’s levees and flood walls failed, leading to the deaths of 1,200 people. The federal organization charged with the rescue and response effort, the Federal Emergency Management Agency (FEMA), soon became overwhelmed with the task at hand. Despite assurances by FEMA director Michael Brown that the federal government was ready to respond to the crisis, there were no emergency response teams from FEMA in New Orleans, or buses and ships ready to evacuate wounded or sick people from the area. Michael Chertoff, head of Homeland Security, was attending a conference at the Centers for Disease Control and Prevention, while President Bush was vacationing at his ranch in Crawford, Texas. While the 9/11 attacks had sensitized the Bush administration to the need for high vigilance in preventing another act of terrorism on American soil, the thought of a hurricane devastating New Orleans was nowhere near the top of the secretary of homeland security’s priority list. As the devastating break in the 17th Street Canal levee widened to 500 feet and water from Lake Pontchartrain spewed into New Orleans, residents were left scrambling to deal with dead bodies and the 22 million tons of debris strewn around the Louisiana coast, including 350,000 automobiles and 35,000 boats destroyed by the storm.
FEMA’s inability to respond to the worsening situation in New Orleans, evidenced by its leaders’ panicked reactions, was a total failure of an agency created at the height of the Cold War—believe it or not—to coordinate national relief efforts in the event of a Soviet nuclear attack on American cities. FEMA’s local deputy, Marty Bahamonde, admitted in congressional testimony that “there was a systematic failure at all levels of government to understand the magnitude of the situation. The leadership from top down in our agency was unprepared and out of touch.”2 Arkansas senator Mark Pryor was less kind: “When FEMA finally did show up, everybody was angry because all they had was a Web site and a flyer,” he testified in front of a bipartisan congressional committee.3 FEMA’s disgraced director, Michael Brown, resigned in September 2005. It didn’t help Brown that, before his appointment by the Bush administration, his most prestigious pedigree had been commissioner of the Arabian Horse Association.
While FEMA was fumbling for resources in Washington, DC, and trying to decide whether it was safe to send supplies into New Orleans, its sister agency inside the Department of Homeland Security, the United States Coast Guard, was exerting itself doing what everyone hoped FEMA would accomplish: saving lives and restoring order. How the Coast Guard got there isn’t as straightforward as it may seem. By 2005, the 40,000-person-strong Coast Guard organization was stretched and partly orphaned. After the post-9/11 shakedown of the federal government, the Coast Guard was pulled out from the United States Navy and told to refocus its mission on port security and maritime interdiction, operating anywhere from California to the Persian Gulf. The great fear of the Department of Homeland Security at the time was that terrorists would smuggle a dirty bomb into a U.S. harbor (think Los Angeles or New York), and from 2002 onward, the Coast Guard was busy patrolling U.S. harbors and providing in-shore protection for U.S. warships deployed to the Middle East in support of Operation Iraqi Freedom.
When Katrina struck, the Coast Guard rose to the occasion and immediately deployed 5,600 personnel from every Coast Guard district, from Alaska to Maine, to New Orleans. Working nonstop in gruesome conditions, Coast Guard rescue workers saved over 24,000 lives and evacuated 9,400 people to out-of-area medical facilities. The Coast Guard rescued more people in that one week than it had the entire previous year! As Douglas Brinkley wrote in The Great Deluge, the Coast Guard “continued to gallantly rise to the occasion. While the section headquartered in Alexandria rescued people in boats and baskets, they welcomed the help from Coast Guard outfits all over America.”4 By contrast, FEMA refused outside offers of help, stubbornly insisting that the situation was under control until two days after Katrina hit, when Michael Brown finally called the White House to alert the president that “this is bigger than what we can handle.” By that time the only assets FEMA had inserted into New Orleans were eight medical emergency response teams.
How did the Coast Guard succeed where FEMA fumbled? Did one of the two organizations have better early warning of Katrina’s likely impact on New Orleans? Did the Coast Guard have a plan to redeploy the bulk of its human and technical assets to assist hurricane victims in the event of a Katrina-like disaster? In either case, the answer is no. Both organizations were relying on the same information from the U.S. National Weather Service and had contingency plans for natural and man-made disasters that could strike the U.S. mainland, Alaska, or Hawaii. What the Coast Guard did have, however, was a strong conviction that it should go out and save lives with whatever means it could string together. The core belief of the service is that “Coast Guard men and women be given latitude to act quickly and decisively … without waiting for direction from higher levels in the chain of command.”5 While Michael Brown and Michael Chertoff were consulting with their staff to decide how best to respond to the unfolding drama, the Coast Guard swooped down into the stricken city to rescue people from rooftops, attics, and makeshift shelters. Within two weeks, President Bush appointed Coast Guard Vice Admiral Thad Allen as the man in charge of the rescue and rebuilding effort, and sent Michael Brown and his staff packing. Allen tackled the most pressing issue decisively, sending teams to recover the hundreds of corpses that were still floating among the post-flood debris. He then explained how the Coast Guard and other agencies would help rebuild New Orleans. “If you are drowning, the first thing you want is dry land,” the vice admiral explained. “If you are on dry land, the next thing you want is something to eat and drink. Having eaten, you want a place to sleep, and then you want a better place to sleep. Then you want aid to start rebuilding and getting your life back in order.” At the bottom of a pyramid, Allen drew a picture of the Superdome, representing the worst part of the crisis. On top of the pyramid he scripted “New Orleans 2.0” as a symbol of the future city he wanted to rebuild.
Where FEMA and Brown fumbled, Allen took charge. He brought together a clear plan of action to deal with the crisis, identified clear priorities for search-and-rescue teams, took bold action to cut through red tape and organizational boundaries, and was a visible on-scene leader after he set up his headquarters in Baton Rouge, Louisiana.
In short, Allen and the Coast Guard demonstrated a burning desire to achieve what I call Creative Execution: the ability to adapt to difficult or unpredictable circumstances, and mobilize an organization to win against the odds. The Coast Guard showed New Orleans that it was possible to clean up and rebuild, supplying both the material and the emotional fuel required for the city to have the confidence to move forward. It achieved a decisive victory against a backdrop of total destruction and loss of hope.
Most organizations experience Katrina moments when they launch a new product or technology, merge with another company, or try to respond to unexpected crises. Yet from all accounts, most perform more like FEMA than they do like the United States Coast Guard. The same slow, confused reaction took place at the Fukushima Dai-ichi nuclear plant when it was hit by the tsunami that struck Japan in March 2011. Unable to make a quick decision about venting the building pressure inside the reactors, the plant’s operator, Tokyo Electric Power Co. (TEPCO), quickly lost control of events. Three of the plant’s six reactors experienced a partial meltdown, and a hydrogen gas explosion damaged the containment core. We now know that it will take 30 years to decommission the plant, which will be entombed in a sarcophagus similar to the one built over the Chernobyl plant. More importantly, we also know from a Norwegian Institute for Air Research study and from the French Institute for Radiological Protection and Nuclear Safety that the accident released twice as much radioactive cesium 137 into the atmosphere than TEPCO admitted, and that up to 30 times that amount leaked into the Pacific Ocean. There is nothing that TEPCO could have done to prevent the earthquake that triggered the 45-foot tsunami waves. But the company’s attempts to downplay the impact of the emergency and refuse the advice that the Japanese government and global experts were providing was a catastrophic human failure on a scale that hadn’t been seen since Katrina. With 43 of Japan’s 54 nuclear reactors now shut down and prevented from restarting due to public outcry, TEPCO effectively crippled an industry that was supposed to provide 50 percent of Japan’s energy by 2030.
The same behaviors that TEPCO and FEMA displayed in their attempts to respond to their respective crises are repeated inside organizations every day. According to the Boston Consulting Group (BCG), 61 percent of mergers and acquisitions (M&A) sealed between 1995 and 2001 reduced shareholder value. If you consider the fact that an average of 21,000 M&A transactions take place every year, and that the average value of deals has doubled since 2002 to over $110 million, a 60 percent failure rate adds up to $1.4 trillion worth of deals that fail to meet expectations each year. The figures only start to improve in 2010. BCG estimates that this is the first year since 1988 that acquirers are, on average, generating positive returns from their acquisitions. Another startling study published in Fast Company showed that 90 percent of people who undergo coronary artery bypass graft surgery return to their pre-surgery lifestyle within two years, rather than keeping to a healthy diet. Quoting Harvard Business School professor John Kotter, who studied dozens of organizations “in the midst of upheaval,” Fast Company explained that “the central issue is never strategy, structure, culture, or systems. The core of the matter is always about changing the behavior of people.”6
Why does this pattern of large-scale organization failure repeat itself so often? I believe the former CEO of Citigroup, John S. Reed, said it best: “The willingness of people to change is limited, and what you pay them seems to be inversely correlated with their willingness to change.”7 Most executives learn this lesson the hard way, overemphasizing strategy and (many times inadvertently) undervaluing the importance of fostering creativity and execution. Inevitably, an organization’s success hinges not on the strength of its strategy, but on its leaders’ ability to craft a realistic view of how the strategy will be implemented, and to empower their people to get engaged in its execution in a meaningful way. Without this ability, the fog of change quickly turns execution into a value-destroying lip service that actually reduces the organization’s ability to turn strategy into action.
What CEOs and executives get paid to do is not to lay out a vision and objectives, and then watch their troops perform from the top of the hill. The command-and-control approach to strategy execution—simply following a plan from a top-down, do-your-piece-and-keep-quiet perspective—is a recipe for failure in the twenty-first century. The Gen X and Millennial generation creeping down the corporate chimney isn’t going to put up with this any more than you would put up with verbal or sexual abuse. It’s not the way forward. What leaders in both public and private organizations need to do is unleash the creative surge and passion that is dormant in all of us, and provide the lift needed to get over strategic stall, the point at which traditional change efforts start to flutter and collapse. Without a plan to address this inevitable stall and anticipate the challenges of internal resistance and organization inertia that typically derail execution, you will end up alongside the bulk of companies and leaders who fail to lead change properly.
What are the derailers that so often turn a good strategy into refined dust? In my work on strategy implementation with hundreds of executives and organizations around the world, I have identified five culprits, which by themselves or in unison can derail the best laid plans. My bet is that you’ve encountered at least one in each organization you might have toiled for:
Defeating Strategic Stall
In studying and working with public and private-sector companies struggling with the challenge of executing their strategy, I have come to discover not only the importance of leaders paying more attention to the pitfalls of execution, but also that there is a universal individual need for creative achievement. People and companies aren’t automatons. We don’t join an organization so that our work lives can become preordained and monotonous—even though the Organization Man of the 1950s seemed to be that way. We want to contribute our creative thinking and energy to the tasks in front of us, otherwise we become disengaged. The best customer service experiences we find in life don’t come from people who consult a book of rules and procedures before they decide whether or not they will help us solve our problem. They come from people who spontaneously and enthusiastically grab hold of our problem, make it their own, and come up with a creative way to solve it on the spot. I experienced that recently when I returned a water-damaged iPhone to an Apple Store. My customer service rep, Kevin, took the phone to open it and confirm the extent of the water damage. He then explained that he needed to answer the following question on his service iPad: “Do you want to help this customer out?” Because I had been upfront about the cause of the water damage, he answered yes. And I walked out two minutes later with a brand-new iPhone.
The key message of this book is that if you want your organization to function more like Apple—or your shareholders to be as content as Apple’s investors—you need to unleash Creative Execution in your organization, and overcome the forces that trip and stall even the best strategies.
What exactly is Creative Execution? It isn’t a form of government, religious beliefs, or didactic principles. Rather, it is the perfect storm that’s generated when the organization’s direction is fully embraced by its employees, stakeholders, and customers, and the total intellectual, emotional, and creative energy that resides inside all of us is unleashed in unison. This rare form of human performance inspired seemingly impossible ventures such as Alexander the Great’s conquest of Asia, Google’s ascent to the pinnacle of Internet companies, and the rise of the Four Seasons from a single motel to global pace setter in luxury hotels and residences.
To be successfully deployed inside any organization, Creative Execution requires five essential ingredients:
Another unique leader, Mikhail Gorbachev, used Candid Dialogue to transform not just a company but an entire country. When he took over the reins of the Soviet Union in March 1985, one of Gorbachev’s first acts was to request more candor and objectivity in the political reports that were presented to him and his Politburo colleagues. After decades of Soviet rule, the Russian economy was in tatters, and the country’s support of Third World regimes had become a costly albatross that Gorbachev courageously decided to curtail. The KGB (now the Russian FSB) issued rather telling instructions at the end of 1985 to underscore “the impermissibility of distortions of the factual state of affairs in messages and informational reports sent to the Central Committee … and other ruling bodies.”9 Most of us live in organizations where the level of candor is somewhere between GE and the Soviet model, and I think it’s pretty clear which model outperforms the other.
For Creative Execution to sustain itself, leaders, managers, and employees need to match the Candid Dialogue, which led to the ownership of the strategy, with roles and responsibilities that link individual and team goals to that strategy. Clear accountabilities are critical because they drive the metrics and rewards that people will use to measure their individual success. People who achieve Creative Execution rely on scorecards that allow individuals and business-unit leaders to track their progress against specific operational goals.
One leader you will meet later in the book, Gary McDonald, thrives on creating Clear Roles and Accountabilities. As the CEO of Thomas Cook for North America, Gary, one of my former consulting clients, turned around an entire business by focusing people on the execution of what he called SPF25—the alignment of Strategy, People, and Finance to achieve $25 million in net profits. Gary made each one of his direct reports accountable for the execution of a particular aspect of SPF25, and the result was staggering. In less than three years, Gary achieved his transformation of Thomas Cook Financial Services, which was then sold to Travelex for $650 million.
Bold Action generates momentum. It firmly propels the organization toward its new direction, and provides a tangible taste of how the strategy will be deployed. It transforms doubters into believers, and passive bystanders into active participants. In the case of Barack Obama, his decision to forego federal funds in 2008 opened the door for his hyper-motivated team to reach out to millions of onlookers who contributed five or ten dollars to his first presidential election campaign.
At the Battle of Trafalgar, Lord Horatio Nelson refused to remove his decorations or cover his Admiral’s uniform while pacing the Victory’s upper deck. He was convinced that his presence on deck would encourage his sailors to fight harder. He was shot and died while leading the greatest naval triumph and feat of Creative Execution of the nineteenth century. In an earlier skirmish in the Canary Islands, Nelson had been in the first boat to attack a Spanish stronghold and was struck in his right arm by grapeshot. Without the aid of anesthetics, the ship’s surgeon removed the arm—and within the hour Nelson was giving orders again. That’s visible leadership!
Violent Roots
I mention Admiral Nelson for a good reason. For roughly three thousand years of our tumultuous history, the only institution organized in a way that would resonate with our concept of modern business organizations was the military. From Ramses and Alexander the Great to Julius Caesar, Kublai Khan, William the Conqueror, and Napoleon, the chief preoccupation of organized society was to field superior armies and navies that could hold at bay potential invaders, or be used as a blunt instrument of conquest. This preoccupation drew some of the best minds from East and West and resulted in a primitive—and highly destructive—form of Creative Execution: the ability to achieve total victory against larger opponents using a combination of unique tactics, weapons, and superior leadership. As Steve Forbes and John Prevas write in their book Power Ambition Glory: The Stunning Parallels between Great Leaders of the Ancient World and Today, “Great leaders articulate their mission in a way that the people who follow them understand what they are being asked to do, why it needs to be done, and how they are going to do it. That is what effective leadership is all about. It was that way over two thousand years ago, and it remains that way today.”10
With the emotional armor provided by these deadly advantages, Alexander marched into Asia at the head of an army of no more than 150,000 Macedonian and Greek soldiers to defeat a Persian army that numbered a million warriors. Admiral Nelson cut down the French fleet twice, first at the Battle of the Nile and then at Trafalgar, without losing a single ship. Largely due to their successful use of Creative Execution, several great empires repeatedly resisted invasion by foreign powers, and ultimately fell as a result of internal problems. Alexander’s army marched all the way to India, and turned back not because it lost a battle, but because the Macedonian soldiers under Alexander’s increasingly tyrannical command grew tired of conquest and refused to go further. Rome’s empire eventually crumbled under its own weight after nearly 500 years of imperium.
During the nineteenth century, Napoleon applied the same principles of Creative Execution to win more land battles than Alexander and Caesar combined. The fact that, at Waterloo, the French emperor broke his army’s back through a senseless charge of the British center is a powerful reminder that your past victories are no guarantee of future success.
It was only in the twentieth century that a power outside of Europe, Japan, finally adopted the Creative Execution formula that had been fine-tuned during centuries of European warfare. Japan was an astute student of British naval strategy. Its Pacific squadron, led by the intrepid Admiral Togo, annihilated a Russian fleet at Tsushima in 1906. In an epic journey, the 45-ship-strong Russian Baltic fleet sailed from its European waters, around Africa and India to meet the Japanese fleet. When the two fleets faced off, Togo formed a line of battle that rained accurate and concentrated firepower over the Russian armada. One of the first victims of Togo’s fire was the Russian flagship, which sank with all hands. In the end, only two Russian destroyers and one cruiser escaped the carnage. Over 6,000 Russian sailors died, versus 600 Japanese—the exact ratio Nelson had achieved at Trafalgar.
Four decades later, Admiral Yamamoto applied similar principles to sink most of the U.S. Pacific Fleet at Pearl Harbor (minus the valuable aircraft carriers, as we all know)—although his reversal at Midway was, like Napoleon’s at Waterloo, swift and final. Yamamoto’s successful attack at Pearl Harbor was a historical wake-up call for the naval establishments in the United States and Europe. Despite its perceived inferior doctrine and equipment, the Imperial Japanese Navy had been able to inflict an embarrassing defeat on the United States. Why? Yamamoto had secretly developed his own Creative Execution formula, which he unleashed on a hapless Admiral Kimmel on December 7, 1941. The United States eventually turned the tables on Yamamoto and the Imperial Japanese Navy, and demonstrated complete mastery of Creative Execution when it sent the majority of the Japanese fleet to the bottom of the Pacific in 1944.
By the beginning of the twenty-first century, Creative Execution had been orphaned by Europe and swiftly adopted by Asia and North America. It was also ready to morph from the military domain to more practical business applications.
The axiom of this book, therefore, is that Creative Execution is no longer a secret recipe. It may have been the salve that European nations used to seal their economic and military expansion since Alexander, but it’s not patented or safe from duplication. Ever since the Industrial Revolution, we have moved gradually closer to a world where leaders who embrace Creative Execution, like Togo in 1905 and Yamamoto in 1941, are able to take on and win against much larger competitors. Manufacturing capabilities, technology, and human talent are now broadly shared and accessible worldwide—from the technology labs of Bangalore to Brazilian soy farms. What was once only feasible for wealthy countries or large organizations to achieve is now open to ambitious rivals around the world. And so whether you’re seeking to build a company from scratch, as Toyota did in the 1950s, breathe new life into an organization, or recover from the global recession faster than your competitors, Creative Execution is for you.
Get Ready for the Ride
In the first section of this book, we’ll study four military masters of Creative Execution and their accomplishments: Alexander during his conquest of Asia, Nelson and his total victories at the Battle of the Nile and Trafalgar, Yamamoto at Pearl Harbor, and General Schwarzkopf in Desert Storm. Each of these unique leaders deployed a Creative Execution formula that wiped out their opposition with stunning results, and in doing so changed the rules of global warfare in a significant way. Their legacy lives with us every day. In the second section of this book, we’ll look at several companies that have successfully applied Creative Execution to advance their destiny far beyond their own founders’ expectations. Toyota leads the pack. Despite the “Great Recall” of 2010, Toyota’s rise to the position of the world’s number one carmaker remains a thought-provoking lesson in Creative Execution. Next, we’ll discuss the Four Seasons, which, from its humble beginnings as a motor hotel in Toronto, grew into the most successful luxury hotel chain in the world. We’ll look at Google, which started as a research project at Stanford University and now stands as the most potent threat to Microsoft’s domination of the Internet. Finally we’ll explore the turnaround of Thomas Cook Financial Services, a smaller organization that wielded the principles of Creative Execution just as confidently as Toyota, Four Seasons, or Google.
But before we examine these unique leaders and organizations, I need to take you back to the hallowed ground of Gaugamela, where Alexander met Darius and gave the world its first taste of total victory.
Chapter 1
Alexander at Gaugamela
Remember, upon the conduct of each depends the fate of all.
—Alexander the Great
The date is October 1, 331 BC. On the plains of Gaugamela, roughly 60 miles east of the modern-day northern Iraqi city of Mosul, Alexander the Great faces, for the third and final time, the mighty army of King Darius III of Persia. On this balmy autumn day, a force of 150,000 Macedonian, Greek, and mercenary warriors under Alexander’s command, 1,500 miles from their home and with no means of escape, defeats a Persian army at least five times its size. King Darius flees the battle, and is killed six months later by one of his advisers. Alexander, at the age of 30, finds himself the ruler of an Asian empire of 70 million people. He has become history’s first master of Creative Execution.
Alexander Comes of Age
The clash at Gaugamela was the denouement of nearly 200 years of war and rivalry between the Greek city-states and the Persian Empire. The outnumbered but highly disciplined Greeks put up remarkable fights at landmark battles such as Marathon and Salamis, and Thermopylae—the “Gates of Fire”—where King Leonidas held off the Persians with 300 of Sparta’s best warriors, giving the Greek armies enough time to regroup and halt the invaders. Just as impressive, but not yet acclaimed in a 3-D Hollywood movie, is the feat of the Ten Thousand, a Greek army of 10,700 hoplite soldiers that found itself surrounded by Persian foes in 401 BC. Rather than surrender, the Ten Thousand voted to walk back from Babylon, located in the heart of the Persian Empire, to the shores of the Black Sea. That’s a journey of roughly 700 miles through what is now northern Iraq and eastern Turkey, which was—and remains—an inhospitable land settled by fierce warrior tribes. Amazingly, five out of six Greek soldiers from those Ten Thousand made it back to shore, and in the process defeated every foe that opposed their march. Stories of the Ten Thousand’s retreat through Persia permeated Greek history and its rulers’ belief in their superior ethos (moral character) and battle tactics. As Victor Davis Hanson explains in Carnage and Culture, “The soldiers in the ranks sought face-to-face shock battle with their enemies. All accepted the need for strict discipline and fought shoulder to shoulder whenever practicable … To envision the equivalent of a Persian Ten Thousand is impossible.”1
Growing up in this warlike Macedonian society, Alexander the Great not only learned the history of Greece’s ongoing cold war with Persia but also received the best classical education available at the time. His tutor, Greek philosopher Aristotle, ensured that his royal pupil understood ethics, politics, and the arcane sciences of mathematics and philosophy. The relationship between master and student persevered throughout Alexander’s career. Alexander once wrote to Aristotle that he would rather “excel the rest of mankind in my knowledge of what is best than in the extent of my power.”2 Paradoxically, this sensitivity to world culture and philosophy would play a significant role in Alexander’s downfall following his conquest of Persia. Instead of subjugating the Persians and imposing Greek and Macedonian customs throughout his new empire—which by classical standards would have been the norm (and was the preferred technique of the Romans, whose empire would outlast Alexander’s by 500 years)—Alexander pardoned most of Darius’s entourage, embraced Eastern beliefs, and dressed in the Persian style, drawing the ire of his fellow Macedonians.
By the time Alexander was in his teens, the enmity between the Greek city-states and Persia remained at an all-time high. But before they could face the Persians, the Macedonians had to tame Greece itself, which felt no compulsion to join any Macedonian adventure across the Aegean. The leading Greek city-states such as Athens, Sparta, and Thebes viewed Macedonia as an unworthy start-up, and weren’t willing to commit their troops and funds to a foreign adventure as bold as the conquest of Persia. A contemporary equivalent would be a U.S.-led proposal to invade the entire Middle East in the wake of the wars in Iraq and Afghanistan. None of America’s allies in Europe or elsewhere would sign up for what they would perceive as an act of folly. Yet that is precisely the task that Alexander and his father, King Philip II, set out for themselves.
Philip’s contribution to this grandiose dream was to build a crack Macedonian army that defeated the Greek forces of Athens and Thebes at Chaeronea in 338 BC. Only 18 at the time, Alexander led the cavalry charge that broke through the Greek center. This decisive, powerful, and bold move would become a trademark of Alexander’s strategy for fighting the Persians. Thanks to this dramatic victory, Philip secured the allegiance of the Panhellenic states and was appointed strategos (general) in charge of the upcoming campaign against the Persians. For the first time, the Greek city-states and their new Macedonian overlord were united in a single front to take on the Persian juggernaut.
As Philip began preparations for his ambitious campaign, Alexander wasted no time in convincing his peers and the king himself that he had grown into a mature warrior who could achieve great deeds against the odds. After watching his father’s trainers approach a wild horse, Alexander asked if he could tame the creature himself. Philip consented, and announced that he would give the horse to Alexander if he succeeded. Alexander approached the animal and gently moved him away from the sun, having noticed that he became nervous at seeing his own shadow. Then he rode his new mount—which was to become the indefatigable Bucephalus—into a controlled gallop to the amazed shouts of king and courtiers.
Soon thereafter, Alexander welcomed a Persian emissary while his father was away and peppered him with questions about his journey, the geography and obstacles he had encountered on his way to Macedonia, and the conditions of the Persian army and empire. The gracious emissary did not know that Alexander would use this information to invade Persia, nor would he have believed it. The Persian Empire stretched from the Indus River in the east to Egypt in the west—what encompasses today the whole of Central Asia, the Middle East, and Turkey.
Compared to this vast empire, Macedonia was just a speck on the map. Persians had every reason to believe that their empire was vastly superior to both Greece and Macedonia, not just in military might but in sheer manpower and economic resources. In the first Greco-Persian wars, the Persians had razed Athens, whereas the Greeks had never come near the Persian capital. Persia’s legendary army, including King Darius’s personal guard known as the Immortals, was thought to number up to a million men—although the real number of frontline warriors was probably less than half that. To some extent the Persians had a more advanced society than the Greeks, having introduced the world’s first attempt to abolish slavery and embed principles of human rights and equality in government.
