We began this book with an emphatic assertion: there is a process which can be utilized by any company to grow rapidly and profitably, provided that it really wants rapid growth. We defined rapid growth as doubling revenues or profits in 12 to 24 months, but added that for some companies a much higher rate of growth is possible. To us, doubling refers to the maximum rate of growth in revenues and profits which a company wants and believes it can achieve.
In the first thirteen chapters of this book, we have described different aspects of the process for doubling. We began by challenging some of the basic myths and superstitions about growth that limit our awareness, tie up our energies and prevent us from achieving what is actually well within our reach. In the second chapter we looked at the five engines, each of which contains vast, untapped potentials for the growth of any company. Chapter Three explains how the maximum power of these five engines is released when they are developed in a balanced and harmonious manner. Next we described the process by which companies release, direct, channel and convert energy to achieve high performance, high profitability and rapid growth. The fifth chapter explains how energy that is normally dispersed and wasted can be conserved and harnessed for maximum results. In Chapter Six we explored ways to increase awareness of emerging opportunities in the external environment as a means to release and mobilize more energy for growth. The next two chapters focused on the power of values to raise the process of energy generation and conversion to the highest level in your company. Chapters Nine to Thirteen present practical strategies to energize each of the five components of your business-people, organization, market, technology and capital-and convert them into engines for rapid growth.
In this chapter, we attempt to tie all these ideas together and apply them in your company through practical strategies for accelerated growth. These strategies are divided into three major categories-partial and comprehensive strategies to energize the company from above downward and isolated strategies that work to energize each individual from below upwards.
AN ACCOUNTANT'S TREASON
In 1982 an accountant named Eduardo Malone was appointed president of the $275 million industrial division of the $2 billion French conglomerate Chargeurs s.a.. Chargeurs is an amalgamation of century old companies whose operations include U.T.A. airlines, textiles, a truck manufacturing division and a shipping line. The company is owned by one of the wealthiest men in France, Jerome Seydoux of the Schlumberger family. The appointment of Malone as president of this conservative, traditional company was an extraordinary event. Chargeurs was a company which respected age and family heritage. Malone had neither. He was only 36 years old and he was an Argentinian, who had previously been controller in one of Chargeurs' Argentine subsidiaries. The appointment was so unusual that when Malone first broke the news to his wife, she exclaimed, "Why, that's treason!"
When Malone moved to Paris and took up his new position, he found a company with notable strengths and weaknesses. Its greatest strength was in the component technology, where it excelled in engineering and production know-how. There was a predominance of family members in top management who possessed intelligence and education but lacked professional management skills. The company maintained a paternalistic relationship with its people, providing good compensation and benefits and jobs for many of their children. There was a dynamic, entrepreneurial culture in the overseas operations. In the foreign subsidiaries authority was decentralized and managers were given a great deal of freedom. In contrast, the organization in France was highly centralized, bureaucratic and authoritarian.
Malone's assignment was to improve the financial performance of the industrial division, which had earned less than one percent profit the previous year, as soon and as much as possible. Everyone was watching and expecting Malone to fail. Apart from an MBA degree and his experience in Argentina, Malone brought to his new job a deep personal belief in people and a sense of responsibility to the welfare of those who worked for him. At the head office he found people working in an atmosphere of fear and insecurity, where ideas were stifled and individual initiative was discouraged. He decided that the greatest urgency and greatest potential lay in the company's people. Despite the company's poor performance and the pressure he was under for quick results, he announced that no one in the company would be fired. With the help of his management team, he identified all those managers in the company who were not performing adequately and he approached each one of them individually with the following question: "How can I help you do your job better?" He encouraged people to speak out their ideas and suggestions and pushed authority to lower levels to empower people to act on their own initiative.
The results of these changes were startling. People who had felt frightened and constricted became expansive and excited. Not only those who had feared for their jobs, but all those who felt demotivated and discouraged began to express fresh energy in their work. The result, as Malone described it, was "Profits exploded!" In one year the net income of the industrial division rose eight-fold, from .75% to over 6% of revenues. That was the power Malone released by giving positive attention to his people.
The dramatic growth in profits at Chargeurs is an example of a partial strategy for releasing the energies of a company for higher profits or revenues. We call a strategy partial, when it focuses on tapping the potentials from one aspect of the business, either one of the five components or one of the thirty values listed earlier.
In the preceding chapters, we have cited many examples to illustrate that harnessing the energy from even one of these areas is sufficient to substantially increase revenues or profits or both. Bang & Olufsen of America grew by 35% in a year by energizing the component market through its commitment to the value of customer service. Precision Grinding Inc. converted a 11% loss into 12% profit within a year, primarily by focusing on improving its financial systems and performance on quality and on-time delivery.
BEN & JERRY'S
Ben & Jerry's is not a company that anyone would take seriously, if it were not for the company's impressive record of growth from $614,000 to $45 million in seven years. A partial strategy has been the driving force for that growth-commitment to two powerful corporate values, quality and service to society.
The company insists on very high quality standards, which include less than half the amount of air used in most other brands of ice cream. Every year tons of ice cream are thrown away, just because they do not meet the company's stringent requirements for perfect texture and blending. Ben & Jerry's has actually pioneered in the development of improved machinery to permit blending of larger and heavier add-in ingredients.
Ben & Jerry's social mission has been the subject of much debate both within and outside the company, but its role in the company's growth is undeniable. It has had an energizing impact on people, the market and the community. When the company went public in 1984, it offered the shares for sale only to residents of its native Vermont. The company supports local industry by purchasing only Vermont milk products at a premium price. Both these actions have won loyalty and support from the local population. In order to promote a more egalitarian, family feeling, it maintains a maximum five to one ratio between the pay of executives and hourly workers. The company also does what it calls "socially-conscious marketing," which means it spends most of its advertising dollars sponsoring public radio and folk concerts. Recently the company introduced a new product, called Peace Pops, of which 1% of the sales proceeds is being donated to the cause of world peace. The company's commitment to quality and serving society have made its market respond.
MATCHING STRATEGIES WITH GOALS
Most of the companies referred to in this book have achieved very high rates of growth and high levels of profitability by focusing on one or two components or one or two key corporate values. Mesa Airlines' real strength has been in careful financial control and proper matching of its equipment to meet the needs of the market. Gartner has excelled in systematizing its research process and energizing its people through an innovative compensation package and a lot of freedom. Vipont's greatest strengths have been in creative financing and innovative research.
The companies referred to in this book are not held up as models of perfection. We cannot even state with confidence that all of them will continue to perform as well in the future as they have in the past. In fact, if the subject of this book had been how the lack of balanced development retards and limits growth, we could cite some of the same companies as examples, since most of them have significant weaknesses off-setting their impressive strengths. But our purpose has been to show how even the development of one or two components or one or two values to a high degree can energize a company and raise it to a far higher level in its industry. All of these companies have tapped the potentials of at least one area and grown dramatically as a result. Not that we advocate or recommend such a one-sided approach. But if your company's goal is only to double or triple in size, a partial strategy, which focuses on one component or one value that is relatively weak, is more than sufficient in most cases to accomplish that limited purpose.
However, if your company's goal is something more than a mere doubling, a partial strategy may not be for you. If, for instance, your goal is to become the leader in your area or your industry, locally, nationally or internationally, you need a comprehensive strategy for accelerating the growth of your company through the process described in this book.
We have described two aspects of the process of growth. The five components are the resources and engines. Each is an inexhaustible source of energy. The bringing together of these five to form a business is the creative act that releases the energy of the components and turns them into engines for growth. The interaction between the components is a creative process which continuously generates new opportunities. Since each component by itself is limitless and the possible combinations and interactions are countless, the creative potentials of their inter-relationships are infinite.
The five components are like the structure of an atom or molecule-a finite number of atomic or subatomic particles combining and interacting in countless different ways to form an infinite variety of forms and physical forces. Science has uncovered the physical and chemical processes by which atomic and molecular energies are released from the atom and molecule and recombined to produce more complex substances and more powerful, more intelligent forms of life. The physics and chemistry by which the five components release their energies and recombine to produce more powerful and productive types of companies is the process of energy conversion described in Chapter Four.
Any company that fully understands the structure of the five components and their interactions and the process of energy conversion can launch itself on a never-ending cycle of growth that generates higher revenues and higher profits year after year and decade after decade. This is not just an abstract possibility. There are many companies that have done it more or less consciously and continuously. Because they have done so for an extended period of time, they are very large corporations today-companies such as AT&T, Delta Airlines, Dupont, IBM, Merck and Northwestern Mutual Life.
But the moment companies of this awesome size are mentioned, the average $1 million, $10 million or $100 million company thinks, "What has that got to do with me?" The answer is, "Everything." IBM was once a $12 million company too. The very fact that there is a process by which one company has grown 5,000-fold from $12 million to $60 billion should be a source of inspiration to every company that has a more modest goal, because one company's achievement proves that it is possible.
Regardless of whether your company is a $600,000 company reaching for $6 million like Ben & Jerry's was in 1981, or a $7 million company striving for $70 million like Linear Technology was in 1984, or a $22 million company aiming for $200 million like AMRE was in 1985, or a $258 million company shooting for over $4 billion like Federal Express in 1979, the process is the same.
Because these companies did many different things to propel their growth and because that growth takes place over a number of years, it is difficult for us to clearly see the relationship between their actions and the results. Therefore, the most dramatic and revealing examples of the process are those which involve a sudden change in direction or policy that results in a sudden change in performance. We have already described dramatic changes of this type at SAS, London Life, C & J Industries, Bang & Olufsen, and Waltz Brothers.
ENERGIZING A LIFE SAVER
The same process occurred more recently when Howard Cooper took over as CEO of Trimedyne in early 1988. At the time, Trimedyne was a company with one marked strength, technology. The company developed and was marketing a high-tech medical device called a laserscope, which can be inserted into a patient's arteries and used to destroy arterial plaque. Plague is the cause of the arterial blockages that until recently could only be treated by surgery.
When Trimedyne received approval from the Federal Drug Administration to market the laserscope in February 1987, the company was caught unprepared. It had 65 people and sales of $5.7 million. There was no real marketing function, no marketing strategy, no sales organization or sales systems. The company did not even maintain a record of customers for its earlier products, so that they could be contacted to buy the laserscope. Its small production facility was unable to meet demand. The limited manufacturing capacity worried Wall Street analysts, who felt that Trimedyne could not deliver on its orders. There was no qualified financial manager, no financial controls, no forecasting, no budgets, no business plan, not even a credit or collection department. There was no personnel function either, no standard wage and salary scales. The company also lacked experienced managers and management information systems.
In other words, Trimedyne had one developed component and little else. Driven by the engine technology, the company's sales doubled in 1986 to just over $12 million. But in the absence of the four components, the company could not go very much further. Cooper was brought in by the Board of Directors, because he was a very experienced executive, who had earlier purchased a struggling medical equipment manufacturing company for $60 million, built it up and resold it for $140 million. After joining Trimedyne, he quickly set about assessing the company's strengths and weaknesses and taking steps to build up the weaker components.
Cooper's first major step was to set a clear direction for the growth of the company. Along with other executives, he developed a mission statement and drew up a strategic plan, which gave a new direction to both marketing and research. The company stopped development and marketing of other medical devices which it had been making in order to focus on the area of cardiovascular disease. At the same time, it widened the field of research beyond the laserscope to cover other high technology methods to remove plaque. Through the plan, Cooper also established clear goals for each department to work towards. "Previously, the company was task-oriented as opposed to goal-oriented," Cooper explained." Now we have tasks as an orientation, but all within the framework of goals."
In the component market, Cooper recruited and trained a team of clinical specialists to educate the public about the advantages of laserscope therapy over other forms of treatment. He doubled the sales force and built up a regional sales management structure. By carefully analyzing the country's demographics, he discovered that 70% of the company's market fell within 17 states, so he decided to concentrate the sales effort on that target territory.
As a businessman and not a technologist, Cooper understood the power of attuning technology to the needs of the market.
"Any company that has some technology can find a small market and grow to $500,000 or $2 million a year. But to grow beyond that there must be a vital difference...Companies run by engineers or technicians without reference to the market typically fail. Usually companies develop technology before they understand the market. I believe technology must take a lead from the market."
To improve coordination between these two components, sales people were asked to report back their experiences directly to the research staff and research engineers were sent out into the field to meet physicians and sense the needs of the market. This coordination led to significant improvements in the product line. The company also accelerated its clinical research program to enable the sales staff to document the advantages of its technology.
Cooper strengthened the component people by recruiting qualified individuals with managerial experience for key positions in engineering, finance, sales, marketing, quality control and personnel. "We can't reach the next plateau of revenues, unless we bring on enough of the right people and incur the expense early enough," he explained. To ensure that people and technology stayed in balance, he cataloged the company's research projects to assess future manpower requirements and drew up a plan to meet them. He also brought in a consultant to develop competitive wage and salary scales to ensure the company could attract all the people it needed. A generous bonus and incentive program was also introduced. At the end of 1988 the company paid bonuses to every employee in the company equal to 13% of corporate net income.
The company also made a major effort to build up the systems it needs to function smoothly and efficiently as it grows. New systems were introduced for monitoring sales performance, managing R & D expenditure, controlling manufacturing costs, and providing marketing information. Cooper found that no distinction was being made between orders booked and orders shipped, so that monitoring the order backlog was impossible. Therefore, he introduced a computerized system to track bookings and shipments by product line.
Cooper modified the company's manufacturing plans to bring them into balance with marketing forecasts. In order to augment production quickly to meet rising demand, the company went to outside manufacturers to supplement its own capacity.
The component finance was so poorly developed that Cooper chose to replace the entire department with more qualified people. Then he introduced detailed financial planning and budgeting.
Cooper understood that in order for Trimedyne to keep growing and become a dominant force in its field, it had to develop in a balanced manner. "There are several areas that we have to excel in, not only in technology and the quality of that technology. We have to also excel in marketing skills, in expense control, in asset utilization...It is important to build a strong management team which can make decisions to encompass finance, marketing, technology and manufacturing. I really believe in the theory of the ubiquitous manager."
The result of these efforts to build up each of the five components and to energize them by closely integrating each with the other four had a sensational effect. In one year the company's revenues increased 250% from $12 million in 1987 to $31 million in 1988. Net income during the same period rose more than 1000% from $494,000 to $5.3 million or 17% of revenues.
THREE ASPECTS OF THE PROCESS
There is nothing which Cooper did that cannot be done by any company. Trimedyne's growth is impressive, both because it is so rapid and because it is based on a comprehensive and balanced effort to release the potentials of all five components.
The process which took place at Trimedyne in a period of one year is the process by which every company grows, regardless of whether that growth is swift and continuous or slow and halting. The process has three fundamental aspects:
Although the process always has these common dimensions, it can vary considerably in terms of its speed, intensity and comprehensiveness. It can also vary in one other important respect: the type or level of energy released and harnessed.
THREE LEVELS OF ENERGY CONVERSION
In an earlier chapter, we described three graded levels of energy that can be released and channeled for growth:
The process of energy conversion can take place at any of these levels with any one or mixture of these three types of energy. The process which occurred at Trimedyne was predominantly physical. This was necessarily so, because the company lacked even the basic physical structures needed for the development of the five components. The process involved recruiting people, adding new positions, installing systems, expanding the sales force and production capabilities, etc.
The effort which Lee Iacocca made to save Chrysler in the early 1980s was also predominantly physical. Here, of course, the basic constituents of the five components were already in place, but the energies of the company were stifled and scattered in all directions. Iacocca had to release and redirect those energies more effectively and efficiently to improve the performance of the company. Under the impending threat of corporate bankruptcy and the even more imminent fear to the workers of losing their jobs, he had to restore discipline among an assertive and intractable unionized work force. In actuality, 34 vice presidents, countless white collar workers and tens of thousands of blue collar workers did lose their jobs. He had to impose coordination between isolated and narrow-minded departments. He had to literally force design engineers, production engineers and marketing people to talk with one another and produce a car which was well-designed and well-built. He even had to threaten Congress with the political consequences of letting the company sink. The magnitude of Iacocca's effort and achievement were heroic. He transformed a bankrupt, comatose giant, which every financial analyst in the country had already pronounced dead, into a dynamic, responsive, very much alive, and rapidly growing company, which not only became highly profitable, but actually doubled in size over the next five years.
REENERGIZING AN ORGANIZATION
Chrysler amazed America in the early 1980s by surviving its crisis and re-emerging healthy, vigorous and highly competitive. Equally extraordinary has been the radical transformation of Ford Motors in the mid-1980s and its re-emergence as the leader of the U.S. automotive industry after sixty years as a successful, but second-class citizen. The process by which Ford transformed itself into a trend-setting, pace-setting sprinter and the most profitable car-maker in the world is an example of energy conversion at the organizational level.
At its colossal inception some 80 years ago, Ford Motors shook the whole world and changed it forever. It emerged out of nowhere to become the largest, most sophisticated, mass-manufacturing company of its day. It put the price of an automobile within the reach of the common man and revolutionized life in America. As if exhausted by this remarkable effort, fifteen years later Ford was overtaken by General Motors and settled down to a life of success and mediocrity, which lasted more than half a century. In the early 1980s Ford reawoke and once again startled the business world with a feat of a different character, but almost equal in magnitude to its initial achievement.
In 1980 Ford shared much in common with Chrysler. Its products had developed a reputation for poor design and shoddy quality. Its entire focus seemed to be on producing quantity, not quality. Its organization had become militaristic, highly bureaucratic and divided into independent fiefdoms. People seemed to be more interested in office politics and fostering their careers than in making good cars. The management style was highly autocratic. Production methods were outmoded and inefficient. The company was over-staffed and under-productive. And like Chrysler, the company was losing market share and losing money too. In 1980 it recorded a loss of $3.26 billion, and over the next few years its domestic car sales declined by 25%. "Running scared," is how one leading industry analyst described the company. "Ford in 1980 and 81' was really looking at the end of the earth."25
Then suddenly the colossus awoke and in a period of three years turned itself into one of the most dynamic and profitable companies in the country. The turnaround was orchestrated by Philip Caldwell, who succeeded Henry Ford II as chairman in 1980, and Donald Petersen, who became president under Caldwell and then chairman in 1985. Together they instituted sweeping changes in all five components and liberated fresh torrents of energy from all parts and levels of the company.
One of their most significant achievements was to realign the component technology to attune it to the needs of the market. We have already described Ford's effort to find out from customers exactly what improvements they would like in an automobile, carrying back 1401 suggestions to its engineers. It invested $3 billion dollars to design rounder, aerodynamically styled cars, culminating in the development of the world's best-selling car, the Escort, and then the Taurus.
Ford also energized technology by implementing the value quality through the five stages-commitment, standards, structure, systems and skills. The company brought in quality-guru Edward Deming and instituted his 14 point program for improving quality and productivity. An Employee Involvement program was instituted to get workers involved in quality improvement and give them the authority to make it happen. Plants and workers were given quality goals in place of production quotas. In one plant the percentage of engines accepted by inspectors the first time they reached the end of the line rose from 60% to 96%, while productivity increased by 27%. By 1987 Ford's quality had improved by 60%, as measured by consumer surveys and repair costs under warranty plans. Elimination of reworking due to improved quality and increasing factory automation have enabled the company to raise productivity by 36% since 1981.
In the component capital, the company introduced stringent cost cutting measures. In order to reduce production capacity to bring it in line with declining market demand, management closed 15 manufacturing facilities, including 3 U.S. assembly plants. It also cut total employment by nearly one-third. It realized a savings of $3 billion by switching to just-in-time inventory management. Now Ford achieves nine turns a year on its inventory, compared with the former six turns.
Ford energized the components people and organization by replacing the old, authoritarian management style with one based on open communication, participation and teamwork. To overcome the habits of the past, company executives underwent week long training programs at Ford's Executive Development Center on participatory management and on how to listen to subordinates. Petersen told executives, "Everyone with legitimate input to your decision should have the chance to be heard."26 Executive bonuses and incentives were linked directly with quality and with people skills. There was an unprecedented drive to push responsibility down to lower levels of the organization. The company minutely analyzed each aspect of its operations to understand how the different parts affected each other and to find ways to improve coordination between them. The emphasis on improving communication and understanding between people had an electrifying effect on the organization and its people. Even Wall Street took note of the change. One analyst remarked: "Ford has opened channels of communication. You've got people sharing data and understanding each other's problems. Decisions are being made with more and better information, which leads to better decisions."27
The result of all these efforts is current history. In 1985 Ford earned $2.5 billion on sales of $52 billion. In 1986 its earnings rose 30% to $3.3 billion on revenues of $63 billion, surpassing General Motors in profitability for the first time since 1924. By 1987 the company had slashed its costs by $5 billion and lowered its break-even point by an astonishing 40%. It had also accumulated a cash surplus of $9 billion. Fortune cited the example of Ford and six other major U.S. corporations as "compelling testimony that restructuring can indeed lower break-even points substantially and lead to a doubling or even tripling of earnings."28
And when just about everyone believed that Ford had accomplished the utmost that could be achieved, Ford's automotive division proceeded over the next two years to rack up an additional 30% rise in revenues and 39% increase in profits, closing 1988 with profits of $4.6 billion on sales of $82 billion. In three years this mega-company had increased revenues by 58% and profits by 84%.
Newsweek's comment on Ford's dramatic turnaround is revealing. "There is nothing startling or even original in Ford's better ideas: the remarkable thing is that they are so obvious and Ford once ignored them and now it embraces them."29
The steps which Ford took to achieve these results are an expression of the process of corporate energy conversion. The company took systematic efforts to build up the five components, to improve coordination between them and establish a greater balance. It released fresh energies from the components by a combination of strategies. The focus on reducing costs and the consequent cutting of the work force had an effect similar to the one at Chrysler. It released enormous physical energy from those who had previously felt secure and complacent. The effort at restructuring, streamlining activities and systems, and opening up communication released organizational energies. The commitment to quality, teamwork and the greater involvement of individuals at all levels in decision-making released higher level psychological energies as well. The outcome was a result of the process of energization, partially carried out at these three different levels, but predominantly at the middle level of organizational energy.
Chrysler and Ford illustrate the truth in the adage that great difficulties can be converted into great opportunities. Very often opportunities come to us in the form of difficulties. When we do not recognize or respond to a new opportunity when it presents itself positively, it sometimes comes back in the form of a physical pressure which we call a difficulty. If a company responds positively to that physical pressure, it releases powerful, latent energies that are pent-up below the surface and explodes into growth. Therefore, the physical pressure generated by a difficulty is often the most opportune occasion for doubling.
THE HIGHEST LEVEL OF THE PROCESS
We selected Federal Express as one of the companies to be cited in this book for two reasons. First, it is a company that has grown very fast over a very short period of time to emerge from the ranks of the small and mid-sized growth companies and enter the ranks of today's giant corporations. In this respect, it has completed the transition which AMRE, Expeditors International, Vipont and many other mid-sized growth companies aspire to achieve. It reveals the next stage of the growth process and dramatically illustrates how quickly this phase can be accomplished. Second, Federal Express is a company that has achieved its phenomenal success through a well-balanced and harmonious development of all five components, and it has energized itself for this growth by a serious commitment to a range of high corporate values including punctuality, customer service, systematic functioning, safety, open communication and development of people.
Federal Express is not a perfect company. It has made its share of mistakes and had its share of problems, such as the $500 million loss on its zap mail facsimile program. But it has gone about as far as any company we know to energize each of the five components at the third and highest level of energy conversion process-by releasing the psychological energies of the individual.
The process of energy conversion is a living organic process. It is the process of growth. So in its highest expression it transforms an organization into a living organism with a life and vitality of its own. The energy and intensity generated at Chrysler and Ford are very impressive, but the dynamism, vitality and lan we felt at Federal Express is of a higher order than these forces. The company is propelled, not by the fear of bankruptcy, not by the spectra of huge losses or job insecurity. It is powered and actuated by a lofty vision of a distant possibility and an aspiration to realize that vision. Not that Federal Express is lost in the clouds. There is nothing ethereal or ephemeral about this company. It is supremely practical and down-to-earth. But it is also fresh, vibrant, and alive. People in the company, like Roger Podwoski, managing director of service systems administration, feel it too:
"There is something more alive about this company. The difference is two-fold: there is this unbelievable commitment to the customer, and employees see we are constantly improving what we do. This company talks a lot. This company is alive, and as long as it's alive you feel part of it. We are constantly looking at different ways to improve. The attitude of improvement is not just at the top. It goes all the way down."
The most noble and inspiring characteristic of being human is this aspiration for growth, the striving to go higher and be better than before, what Ted Weise called "a fanatical urge to do better." That is the esprit de corps at Federal Express.
Think about the process of growth in your company. Is your company growing as fast and as far as you want it to? If companies the size of Federal Express and Ford can grow so quickly, why should you be satisfied with anything less? What can you do to accelerate the process? What type of energy is your company releasing and expressing for its growth? Is your company tapping physical, organizational or individual energies? What can you do to elevate the process to a higher level of intensity?
Patience is a great virtue and sign of wisdom, but it can also become an rationale for accomplishing much less than you are capable of achieving. The process we are describing does not require a lot of time. As soon as the right conditions are provided, the energy is released and acts instantaneously. If you are thinking that growth has to take a long time, think again. Life is filled with examples of individuals and companies rising with lightning speed to the top. The real determinant of time is only the intensity of the aspiration that inspires you to grow.
ENERGIZING FROM ABOVE AND BELOW
The partial growth strategies are very potent. The comprehensive strategies are extremely powerful. Yet there is one more strategy that can be at once easier to initiate and even more effective than either of these.
The partial and comprehensive strategies start at the top of the company and work their way down. In most companies the process works something like this: The CEO has an intense aspiration or inspiring vision which releases his energy. He communicates this idea to his management team and tries to inspire them with his vision and win their enthusiastic support. The management team conceives of a plan to implement the idea and develops a consensus at the top as to what can be achieved and how. Then senior management translates the plan into practical programs for action and presents them to middle management. Middle management formulates detailed operational plans for execution by first line managers. At each step in the process both the idea and the energy to achieve it have to passed on from one person to the next, from one level to the next, so that the plan will carry the necessary power for realization. If the CEO succeeds in fully inspiring senior managers with his vision and they in turn succeed in fully enthusing middle management with their plan, then the process gains momentum and releases fresh energies at successive stages as it travels down through the organization.
When the movement is fully successful and the entire company is energized by the vision to achieve the goals of the plan, then even small, routine individual acts express something of the energy and inspiration of the overall vision. The telephone operator answers the phone with a eager, cheerful friendliness that is genuine and irresistible. The production operator works with a briskness, pride and meticulous care worthy of the finest skilled craftsman. The whole company radiates and overflows with happy, buoyant, confident, exuberant energy. This is the end result of the process of energy conversion when it releases the highest level of psychological energies and when it is taken all the way down to the level of the individual act.
Instead of starting at the top with a comprehensive strategy to energize the whole company and working down to energize successive layers of acts, it is also possible to start at the bottom at the level of individual acts and by energizing many of them release fresh energies that spread by contagion from one act to the next, from one level to the next, until ultimately they energize the whole company to the top and to its core. The essential elements of the process are the same in either case, only the direction is opposite.
The process that moves from the top down starts with the CEO and with a central plan and is propelled by the authority of those at the top. The process that rises upwards from below can be initiated by any manager, any individual and spreads spontaneously in an atmosphere of freedom.
The principle underlying the comprehensive and partial strategies is that each component of the company can be managed in such a way as to release fresh, productive energy in that component and through their interrelationships in other components as well. The principle underlying the process that begins from below is that every act in a company can be carried out in such a way that it releases fresh productive energy during the act and in the people who are involved in it and by contagion in related acts and people too.
When the dispatcher at P.A.M. listens attentively and sympathetically to the personal problem of a driver who is 2,000 miles away from his family, that act can evoke a response of appreciation in the driver and satisfaction in the dispatcher which spills over into other acts they perform and spreads to other people they interact with. The grateful driver may smile infectiously as he meets the next customer or go out of his way to solve the customer's problem. The dispatcher becomes more alert, because he now finds his job less monotonous and more challenging, and that alertness enables him to identify a better routing for the trucks that saves time for the customer and money for the company. One thoughtful act can energize service to the customer, human relations within the company and productive efficiency as well.
FIFTEEN WAYS TO ENERGIZE AN ACT
Every act in a company can be energized, no matter how small and how routine it is. Here are some basic ways to energize an act.
Act from the other person's point of view
Taking the other person's point of view applies to everyone-even to our subordinates! In the midst of the Great Depression, Tom Watson went down to the factory floor and asked machinery operators how their jobs could be made easier and more productive. Taking his employees' point of view really energized his people and resulted in significant productivity gains as well.
Federal Express permits its customer service telephone agents to knit a sweater or read a novel between phone calls, because they understand how boring it can be just sitting around waiting for the phone to ring. The operators are a lot more alert and cheerful as a result.
All outgoing, expansive movements energize, such as wanting your employees or your customers to earn more. Vipont has consciously adopted the concept of "mutual benefit" as corporate policy. "Our goal is to provide a benefit to everybody," says CEO Larry Frederick. "Our products provide a benefit to the consumer, to the dentist and hygienists, to the retailer." Employees benefit as shareholders. Dentists and hygienists, whose clients have fewer cavities to treat than in the past, are able to offer additional services to them for treating plaque. Retailers earn higher margins on Vipont products.
The Delta agent explained over the phone that the airline does not fly that route. Before we could say "thank you" and put down the phone, the agent told us the names of three airlines that did. This time we managed to get in a "thank you" before the agent asked us what time we wished to fly and proceeded to read off the departure times of six flights that might be suitable. Then after a second "thank you" and a second attempt to hang up, the agent asked to our amazement, "Would you like the phone numbers of the other airlines?" What customer would not remember a company that remembers the customer this way?
Strive for perfection
Relate to the uniqueness in every act
In the same manner, every customer, every employee and every situation is unique and responds differently when we treat it that way.
Create a sense of ownership by giving authority
The Federal Express hub in Memphis, the city's second largest tourist attraction, receives thousands of visitors every year. The people who act as tour guides behave like well-trained and seasoned professionals, full of useful and fascinating information, and bubbling with enthusiasm. Yet these tour guides are actually regular company employees who take up the special assignment on a rotating basis. Being asked to tell the public about their company is an enjoyable and satisfying experience for employees and makes their presentations enjoyable and satisfying to visitors too.
Federal Express customer service operators also rotate teaching classes on customer service to new batches of employees. Since every executive must take the customer service classes too, occasionally an operator finds herself giving instruction to her boss's boss's boss. That is energizing!
Put in a system wherever it is missing
Relate an act with another act
Imparting or upgrading a skill energizes
Implement any value in the act
The power of attitude
Create challenges and opportunities for people to be successful
Give personal attention
Tools of measurement energize
Take active interest in the promotion and progress of your subordinates
Focus on work, not the person or the position
John Banks, CEO of Audio Centre in Montreal, understands the power of the individual act. When a new phone operator was recruited, John spend one full day sitting with her and listening to how she answered the phone. After each call, he told her how her words and tone of voice made him feel. His theme to the operator was, "I spend a fortune on advertising and what do the customers get? They get you! Energize every word you speak with a smile in your voice." When a new accountant joined the firm, Banks asked him to spend two weeks out on the sales floor, so he would become sensitive to the needs and feelings of the customers.
Banks is equally concerned about the smallest word and gesture of his sales force. When the store is busy and all the sales people are engaged with customers, he still expects one of them to rush over to greet each new customer who walks in the door and promise them attention at the earliest possible moment. In his training sessions, John focuses on understanding exactly how the customer feels, the doubt, distrust and anxiety that are inherent in the relationship of customer to sales person and the importance of tiny gestures, such as failing to make eye contact for a few second when the customer is speaking. "I have tried through 547 morning meetings to stimulate our sales people's compassion for the typically confused or intimidated customer. This constant effort has energized our client relationships and has been responsible for a great part of our growth," he says.
John says: "There are no miracles in this business. It all comes down to simple acts. Never having a dirty ashtray. Never walking past a piece of fluff on the carpet. My biggest challenge is to energize my managers, so they will energize their people. Every single small act has a significance to the overall result."
Just exactly how small an act does John refer to? "I tell my staff that if two sales people are talking when a customer walks in the door, they should end the conversation right in the middle of the sentence and directly attend on the customer. I tell them, "Don't even wait to finish the joke.' The customer is so sensitive. Split seconds make the difference. We have been able to split seconds here." It is no wonder that Bank's business has grown five-fold over the last five years, from $2 million in 1984 to $10.5 million in 1988.
INSTITUTIONALIZING THE ACT
Every act performed in a company can be energized by any individual through one or more of the fifteen methods described above. Each energized act infuses fresh energy into the organization and makes work more alive and enjoyable. People begin to think, feel and respond differently. Employees come to work with a different attitude. Customers approach the company with new expectations. The contagion of freshness spreads to other people and other acts, until it becomes a culture or way of life within the company.
Such a spontaneous process can flower and spread by itself up to a point. But often it will stop at the boundaries of one department or one level of the company. The process can be facilitated, accelerated and extended throughout the company by institutionalizing it at four different levels. The higher level methods release greater energy and freshness, but they depend to a great extent on the personal understanding and attitude of each individual who employs them. The lower level methods are less powerful and effective, but they are much easier to extend to many people and many acts. Any company striving to energize itself from below will find that all the methods are useful.
C.E. Woolman was a simple man of great personal warmth, who won an endearing loyalty from his people, yet was forever urging them on to higher performance. Woolman was a man of many values, but two-which in many companies oppose one another-stood out most prominently: his respect for people and his thriftiness. He had the open friendliness of a farmer and the frugality produced by the Great Depression. There are many stories recounted at Delta about this legendary man. One in particular illustrates just how powerfully a single, small act can energize a whole company.
A young man was posted on the night shift at Delta's airport repair hanger, where planes are serviced for the next day's flights. He was responsible for managing the spare parts room and providing parts to the technicians working on the planes. Usually most of his work occurred early in the night, when the maintenance process was beginning. So he sometimes found there were long hours with nothing to do. On one such occasion, the young man fell asleep at his desk, for how long he did not know. Then suddenly he was aroused by a most uncomfortable feeling and immediately realized that there was someone standing in front of him in the room. As he raised his head and glanced up at that man's face, his worst fears were confirmed. It was C.E. Woolman. Woolman looked down at the man with an expressionless face, paused for a few moments, and then said: "Young man, if you are going to sleep on the job, the very least you can do is turn out the lights!"
This unforgettable story, told by the young man with humor and affection to everyone he met and retold by them countless times to thousands of other employees, friends and customers, is the epitome of an energized act. In a split second Woolman had reinforced two of his most precious and apparently contradictory values-cost consciousness and his commitment to his people. This story and many others like it loom large in the minds of Delta employees when they speak to customers on the phone, when flight attendants share their own sandwiches with hungry customers on late night flights, and when managers discover the errors made by their subordinates. And each time they recall or recount these stories, they release more energy and add a little more freshness to their work.
ENERGIZING EVERY ACT
There are rare, wonderful moments in life, when you feel totally alive and fresh and joyous, when you really believe that anything and everything is possible. At such moments you are fully alert, fully confident, overflowing with energy. And very often at such times, the thought occurs. "If only this could last. If only I could feel this way always. Life would be unbelievable."
The highest and greatest goal a company can strive to achieve is not to double or triple its profits or revenues. It is not to become the largest or best of its kind in the country or even in the world. The very highest aspiration a company can have is to fill its every working day with unforgettable moments like these, so that every employee and every act is overflowing with energy and constantly growing as far and as high as they can. Such a company need not even think about doubling, because it will double every year.