Twenty-five years ago, my life (and yours, too, probably) was changed by Tom and Bob's book, In Search of Excellence. After that, on a regular basis, Tom has provided us with shots of brilliance and unsettling reminders that we've got a long way to go to reach our potential as organizations and individuals.

Along the way, there's a question that's been nibbled at but never really answered. I mean, I already know many of the 687 ways to create excellence and the imperatives of excellence, but what is it, really?

At first, organizations got excited about the formula: excellence = quality. If we can meet spec, regularly and on budget, we win.

But the quality mantra only takes you so far.

Take, for example, my water company. Are they excellent? Every time I turn on the tap, water comes out. The bills aren't outrageous. I never need to call them. Are they excellent? Or boring?

What about the local grocery or the other boring commodity providers in my life? By my definition, once you start providing a commodity that your customers treat as a commodity, you're no longer excellent.

Here's my take:

Excellence means that you're indispensable. At least right now, in this moment, there's no one else I would choose but you. You, the excellent one, are so surprising, so delightful, so over-the-top and, yes, so human that there really isn't anyone else I'd rather dance with.

The "in the moment" nature of excellence makes it a moving target. JetBlue was excellent, for a while, but then others started catching up and new management started slowing down. Suddenly, it wasn't a JetBlue flight any more, it was just a flight. Easy to switch to Virgin Atlantic or someone else.

Excellence isn't about meeting the spec, it's about setting the spec. It defines what the consumer sees as quality right this minute, and tomorrow, if you're good, you'll reset that expectation again.

The surefire way to achieve excellence, then, is not to create a written spec and match it. The surefire way is to be human. To be artistic: to make a connection with the customer and to somehow change them for the better. The reason Tom and I and others can continue to write about excellence twenty-five years later is that we're not writing about business at all. We're writing about people.

When the Ritz-Carlton hotel empowers every employee from chambermaid to manager to "make things right," they're not engaging in the sort of quality control most managers are comfortable with. In fact, if they were able to write down exactly what to do in every situation, the excellence factor would disappear. What the hotel accomplishes with its policy is this: they challenge their employees to become artists.

The art of connection, the art of being human, the art of making a difference. Artists do things that have never been done before. They dig deep to create passion. They connect by changing things for the better.

The economy has been better, and the economy has been worse. Through it all, the market seeks out, recognizes, and embraces artists, people we can't live without. That's our opportunity right now.

To be excellent means you must be an artist.

[See Seth Godin's new book, Linchpin. It's about art and gifts and connection and yes, excellence.]

In my own "Group I World," a single word is on my mind, and it was there before the Christmas Day NWA/terrorist fiasco.

The word: Resilience.

I expect my computer to work—and the rest of my electronics as well.
I expect my car to start—and for gas to be plentiful.
I expect safe food.
I expect my two stepsons to make it home for holidays.
I expect ...
I expect ...

I've got a generator for the farm house that I bought in a super-cautious moment prior to Y2K. And a six month supply of meds that my doc suggested at the time of the bird flu scare.

And I spent two years in Vietnam.

But I'm soft. I expect everything I need to work, and small disruptions piss me off.

I have no plans to become a survivalist—though my VT farm is a pretty good place to be in that regard. But I do plan to think about "it" a little more than I have.

As I said, I planned to write about resilience prior to our terrorist scare. Namely because, as I parse the evidence as a non-expert, I think the odds are high that the next 10 years will bring a major terror event, maybe another financial crash, and so on.

Half-assed as it is, I'll leave it at that, leave it at a call for explicit attention resilience.

There are five other mini-segments to present in this New Year's 2010 Post. The first comes from writing my new book. It's really largely about the "basics," and in particular about thoughtfulness and civility. I think thoughtfulness-civility-grace-decency-kindness-appreciation pays off ... Big Time ... on the bottom line. And I think it pays off when you look in the mirror or raise your kids. And, incidentally, I think it's directly related to resilience—that is, going gently in the world serves the community and keeps the heat (emotional reaction to tough news) a little lower.

The third word is serve. In my new book I call leadership a "sacred trust,' and I think it is. To steal shamelessly from Robert Greenleaf, I am a keen fan–adherent of "servant leadership." Leaders work for those who "report to" them—not vice versa.

Word four: contribute. We Group I-ers (see above) simply have an obligation—a pressing obligation—to give back and lend a helping hand. I live in an other-than-high-wage community, and I deeply deeply appreciate the enormous amount of time and energy my wife is contributing as Board leader of our local daycare center. (This is hardly her first major act of community service-leadership; it's simply the one most on my mind at the moment.) Contradicting to some extent my Group III mention above, I am a strong adherent, assuming you're not Bill Gates, of supporting (time, $$) local efforts where you can have direct impact. (Perhaps from local "fanatic" service will grow the desire to expand the stage on which you work.)

Next up, and next to last is ... learn. The best way to stay fresh and vibrant, and thence useful, in my opinion, is to seek new experiences and learning opportunities. Like all of these "words," it takes thoughtfulness (planning) and work—though presumably this work, in every case, should largely be an act of joy.

The final word? My old friend ... EXCELLENCE. I never get tired of it, and I hope you don't either. It's a wonderful standard, a wonderful aspiration, a wonderful way of life (the aspiration to).

So my Aim2010 is to focus on these words:

Resilience.
Thoughtfulness-Civility.
Serve.
Contribute.
Learn.
EXCELLENCE.

Doing so hardly solves the problems of Africa, or the "gendercide" I wrote about yesterday (girls being killed-murdered by the million for no reason other than being girls). And for that I apologize.

In any event, may your year be one of peace and health and energetic engagement and exploration.

Tom

As to best book by a "finance guy," it's no contest! The gold to Vanguard Mutual Fund Group founder John Bogle for Enough. The chapter titles tell the story. Here's a sample:

"Too Much Cost, Not Enough Value"
"Too Much Speculation, Not Enough Investment"
"Too Much Complexity, Not Enough Simplicity"
"Too Much Counting, Not Enough Trust"
"Too Much Business Conduct, Not Enough Professional Conduct"
"Too Much Salesmanship, Not Enough Stewardship"
"Too Much Focus on Things, Not Enough Focus on Commitment"
"Too Many Twenty-first Century Values, Not Enough Eighteenth-Century Values"
"Too Much 'Success,' Not Enough Character"

As to the overarching theme of the book, Mr. Bogle begins with this vignette: "At a party given by a billionaire on Shelter Island, Kurt Vonnegut informs his pal, Joseph Heller, that their host, a hedge fund manager, had made more money in a single day than Heller had earned from his wildly popular novel Catch-22 over its whole history. Heller responds, 'Yes, but I have something he will never have ...
enough.'"

My "best management book" award goes to my old pal (pal = full disclosure) and Fast Company co-founder Alan Webber for Rules of Thumb: 52 Truths for Winning at Business Without Losing Yourself. From the beginning ("Rule #1: When the going gets tough, the tough relax") to the middle ("Rule #26: The soft stuff is the hard stuff") to the end ("Rule #52: Stay alert! There are teachers everywhere"), Alan doesn't miss a single beat in 52 tries. My runner-up, by a heartbeat, in the management book category is The Cost of Bad Behavior: How Incivility Is Damaging Your Business and What to Do About It, by Christine Pearson and Christine Porath. Decent behavior pays off, big time, and never more than in tough times—this is not a "be good" book, it's a "make money" book.

Now, to the Grand Prize Winner, my "Best Business Book 2009." The Gold goes with delight to retail guru George Whalin for Retail Superstars: Inside the 25 Best Independent Stores in America. Mr. Whalin is our tour guide to Excellence, and his first stop is, naturally, Fairfield, Ohio, home to Jungle Jim's International Market. The adventure in "shoppertainment," as Jungle Jim's calls it, begins in the parking lot and goes on to 1,600 cheeses and, yes, 1,400 varieties of hot sauce—not to mention 12,000 wines priced from $8 to $8,000 a bottle; all this is brought to you by 4,000 vendors from around the world. Like virtually all the stores in this book, customers flock to the doors from every corner of the globe. Then there's Abt Electronics in Chicago, Zabar's in Manhattan, and Bronner's Christmas Wonderland in Frakenmuth, Michigan—a town of just 5,000. Bronner's 98,000-square-foot "shop" features the likes of 6,000 Christmas ornaments, 50,000 trims, and anything else you can name if it pertains to Christmas.

And: The Ron Jon Surf Shop in Cocoa Beach, Florida.
And: Junkman's Daughter in Atlanta.
And: Smoky Mountain Knife Works in Sevierville, Tennessee.
And: the grand finale, finishing where we started—in Ohio; This time the spotlight is on Hartville Hardware in Hartville OH.

George Whalin's winning stores demonstrate–prove so many (heartening) things:

You can create a worldwide attraction and thrive as an independent in the Age of the Big Box retailer!
You can do anything!
You can be from anywhere!
You can make any-damn-thing ... bizarrely-amazingly-stupendously-special!

I think Whalin's message is perfect for 2009. We will, over the long haul, rebound from our colossal economic and unemployment mess on the backs of our entrepreneurs. The big guys may re-stock their payrolls a bit, but the generals, GE and GM, ain't the answer. And among the entrepreneurs, only a few, statistically, will be from Silicon Valley. To be sure, the best of the sexy entrepreneurs spawn whole new industries, but the blocking and tackling when it comes to jobs and productivity will come from Sevierville TN and Fairfield and Hartville OH and Frankenmuth MI and a hundred hundred other towns and small cities whose names, mostly, you haven't heard of.

When I initially blogged about Retail Superstars, I said, "I guarantee that any reader—from anywhere, in any business—can learn something from this book." I believe that. And because of that, Mr. Whalin takes home the Gold. (FYI: A great companion to Retail Superstars is Bo Burlingham's 2005 Small Giants: Companies that Choose to be Great Instead of Big.)

And so it goes ...

Once again, I've been AWOL. Once again it was "the book."

(This is the first time since I started blogging in 2004 that I've had a new book in progress. I'd forgotten—fortunately—the intensity of the process. "Fortunately," because if I'd remembered correctly, I'd have run at 100mph from the idea of going after "it" again.)

At any rate, the 4th complete edit by me (two others by outside editors) went off to HarperStudio, our publisher, on Monday—Erik and Cathy also won front row streets on the "18-hour days" bandwagon. Now, for the next few days the Beloved Manuscript is in the hands of the nasty-brutal-unforgiving-nitpicking Copyeditor. (God bless Copyeditors!)

The book is due to appear in early February, but we thought we'd let you take a look at the Introduction—remember, with at least a couple of rounds of editing to go.

Herewith:

INTRODUCTION

On July 28, 2004, I made my first Blogpost at tompeters.com. The topic was then-Illinois State Senator Barack Obama's speech to the 2004 Democratic Convention in Boston. In an apolitical Post, I said that it had been one helluva speech—take it from someone who knows a good speech when he hears one. (Me.) Since then, I've made over 1,700 Posts, and with the help of many friends the Blog has prospered—even bagging a "Top 500" designation in 2007!

On September 18, six weeks after beginning my blogging adventure, I happened by a particularly messy chain-store branch in the Natick Mall outside of Boston. I followed the visit with a spur-of-the-moment, throwaway Post that I called "100 Ways to Succeed/Make Money #1": "THE CLEAN & NEAT TEAM! (TEAM TIDY?)"; I suggested that the store's blatant disarray screamed ...

"We don't care."

I said that stores, and even accounting offices, were judged as much or more on appearance as on "substance." In fact the appearance is a non-trivial part of the overall assessment of the "substance."

I promised that I'd proceed to supply 100 such "success tips"—God alone knows why!

I enjoyed the process, and by July 2009 we'd posted precisely 176 of the promised 100! Somewhere along the way, Bob Miller, first boss of the publisher Hyperion, and currently launching HarperStudio, ran (surfed) across the tips, got in touch with us, and said, in effect, "You've inadvertently written a book." He sent along a contract—and we signed, despite my prior vow, recorded in blood, that I'd never write another book. But, hey, why not, a few books sold, a little publicity—and no work!

Ha!

Continued reading The Little BIG Things...

Posted by Tom Peters |

"It has been long in coming, this slow death of what was once the greatest and biggest corporation in the world. The myriad causes of its demise have been thoroughly chronicled, but to my mind one stands out: The custodians of GM simply gave up trying to build the best cars in the world. To accommodate a host of competing interests, from shareholders to bondholders to labor, they repeatedly compromised on excellence. [My italics.] Once sacrificed, that reputation has proved impossible to recapture. ... Can anyone say GM builds the best cars in any category?"

The memory this morning is of this little-trivial "moment of denial" (dear god, 9% is awful) which, alas, has been characteristic of the last 30 years of GM's history. The depth of the GM malaise, of course, is why we the taxpayers are highly unlikely to get much or any of our $50 billion plus back that we are about to "invest."

(I know why we're doing what we're doing and concede it's probably necessary; but, at age 66, having just flown around the world in one week and eight hours, it is annoying to realize that a few minutes of those grueling hours will have been devoted to generating tax dollars going to GM to extend their public agony; I'd rather have said tax $$, which I don't begrudge Uncle Sam, going to, say, university biotech research—i.e., tomorrow rather than yesterday.)

I chose this morning to think about Cisco and Apple and Oracle and Google and Walmart and Whole Foods and Starbucks and Amgen and Medtronic and Basement Systems and all the other great American companies that now define us. And the unknown wee companies, founded yesterday or the day before, that will knock off the Starbucks and Ciscos—long live creative destruction, the true engine of longterm prosperity.

I guarantee that any reader from anywhere can learn something from this book:

Retail Superstars: Inside the 25 Best Independent Stores in America, by retail guru
George Whalin

Guarantee?
Yup!

These are stores that, literally, give new meaning to the word "special." That personify one of my "Top 10 Favorite Quotes," from Jerry Garcia (The Grateful Dead): "You don't want to be merely the best. You want to be the only ones who do what you do."

We start, naturally, in Fairfield, Ohio, home to Jungle Jim's International Market. The adventure in "shoppertainment" begins in the parking lot, and goes on to 1,600 cheeses and, yes, 1,400 varieties of hot sauce—not to mention 12,000 wines priced from the very bottom to $8,000 a bottle; all this is brought to you from 4,000 vendors from around the world. Like virtually all the stores in this book, customers arrive from every corner of the globe.

There's Abt Electronics in Chicago, Zabar's in Manhattan, and Bronner's Christmas Wonderland in Frakenmuth, Michigan—a town of just 5,000 whose 98,000-square-foot "shop" features the likes of 6,000 Christmas ornaments, 50,000 trims, and anything else you can name if it pertains to Christmas.

There's the Ron Jon Surf Shop in Cocoa Beach, Florida.
And Junkman's Daughter in Atlanta, and Smoky Mountain Knife Works in Sevierville, Tennessee.

We finish the tour where we started—in Ohio. This time we visit Hartville Hardware in Hartville, OH.

These stores demonstrate-prove so many things:

You can create a worldwide attraction and thrive as an independent in the Age of the Big Box retailer.
You can do anything.
You can be from anywhere.
You can make any-damn-thing bizarrely-amazingly-stupendously special.
"Customer care" gets a new definition.
"Showmanship" gets a new definition.

If you run a training department ... you can learn from this book.
If you run a sales department of 1 or 101 people ... you can learn from this book.
If you run a purchasing department ... DEDICATED TO INTERNAL CUSTOMER CARE ... you can learn from this book.

You can learn about Special.
You can learn about being "the only ones who do what we do."
You can learn about Leadership.
You can learn about "experience marketing."
You can learn about the irrelevance of Supersized Competitors ... if you are special enough.
You can learn about Sustaining EXCELLENCE.

Inside the 25 Best Independent Stores in America gives new meaning to my trademark phrase:

EXCELLENCE. Always.
If not EXCELLENCE, What?

As I said, perhaps for the first time:

I guarantee that any reader engaged in any activity, who wants to, can learn from this book.

[Note from Cathy: Tom says the fun starts in the parking lot, but I say it starts on the websites of these businesses. Except for the Junkman's Daughter link, every one of the links in this post leads to an exciting website with fantastic images and goods aplenty on offer. And if you want a sword, I know where you can get one. In fact, I almost bought a knife, a basket of goodies, a set of speakers ... ]

(Yes, I slept on the flight home from Shanghai to Boston; at least, I think I did—I don't remember.)

As the last half of day three began, I wanted to summarize—very succinctly—what had gone before. I pulled together 25 slides (attached), making just six points:

Point #1/Aspiration.

I recalled a seminar in Siberia in April 2006. Given the unusual setting, I dug deep into my often neglected packet of Basic Beliefs about Organizations. So I issued a challenge, and have issued it a hundred times since.

At its best (alas, hardly the norm), an organization, any organization can be/should be:

... an emotional, vital, innovative, joyful, creative, entrepreneurial endeavor that elicits maximum concerted human potential in the wholehearted service of others—e.g., Employees, Customers, Suppliers, Communities, Owners, Temporary partners.

My question, as I said, repeated now a hundred times: What else—literally—could the point be of any collective human endeavor, grand or mundane? No, I can't imagine this as the norm on any given day, but I can imagine this as a very real, very pragmatic aspiration. I've discovered that, upon serious reflection, most people agree that this is indeed a pragmatic aspiration—an aspiration worthy of measuring oneself and one's mates against.

This is the point of organization.
This is the point of organizing per se.
Period.

(Right?)

Point #2/Listen.

I have become obsessed with "listening." (About time, some of my friends might add ...) I think it was Dr. Jerome Groopman's book, How Doctors Think, that tipped the balance. Groopman observes that the patient is unequivocally the best source of information about the patient's perceived problem. But to extract useful info the doc must listen to lots of noise along with some signal. Alas, research that the average doc interrupts the patient after 18 seconds! I'd say the average [know-it-all?] boss is in the same sorry boat.

Everything (!!—big word) proceeds from listening—to our spouse, our kids, our friends, strangers along the way (my forte), our students, our employees, our customers, etc. And yet, while we study accounting or history or piano for years and years, we seldom if ever study listening.

Study.
Really study.
Pursue Mastery.
Pursue Excellence.
Become a "professional."

When "six-sigma" quality became the rage, one of the accoutrements was a rash of training programs that allowed one to become a "six-sigma blackbelt." Companies of all sorts and sizes made a big fuss over this. Though it's a little much for me, I nonetheless want to steal shamelessly: I want organizations of every size and shape to start programs aimed at having participants work assiduously to achieve and then maintain "listening blackbelt" status.

Listening, to one and all, intently and constantly, even obsessively, may be/is the greatest of strategic strengths—the greatest of "sustainable competitive advantages."

100% "Listening Blackbelts"!
Or bust!

Point #3/Ask.

Dave Wheeler commented at tompeters.com that the "four most important words" in an organization are:

"What do you think?"

I agree.
Wholeheartedly and unabashedly.

Shouldn't "listening" and "asking" be combined? Perhaps, by some narrow logic. But remember my situation—trying to extract for my Chinese colleagues the most significant points in a 3-day seminar. It's my subjective judgment that The Big Four Words—"What do you think?"—must be singled out, put on their own separate and tall pedestal.

There is no greater honor (!!) that can be bestowed upon a person, peasant or prince, than "What do you think?" "What do you think?" automatically makes me a person of value, whose observations and opinions are of the greatest importance to the functioning of the organization.

Benefits are piled upon benefits! The person routinely asked "What do you think?" starts thinking about what to say when asked "What do you think?"!! This Virtuous Circle of Engagement literally ensures that the quality (breadth and depth) of engagement increases markedly over time.

The idea here—obviously, I assume—stretches beyond the borders of our formal organization. E.g.: "What do you think?" is also World's Best Customer Loyalty Program! The Web is, in fact, teaching us the limitless value of The 3Cs—Continuous Customer Conversations.

Get "Ask" & "Listen" right and you've taken a giant step toward Excellence—the Holy Grail!

Point #4/Fail.

Ask.
Listen.

Act.

"It" is all about attention-recognition-engagement. And action. None of the above, to state the obvious, matters unless something happens. Twenty-seven years ago Bob Waterman and I put "bias for action" at the top of our list of the Eight Basics of Excellence. As the speed of change accelerates exponentially, that notion increases in importance—also exponentially. I've often said that I've learned but one thing in my 40-year professional career: "He/She who tries the most stuff wins."

Well, I mean it.

But it is the corollary to "bias for action" that I singled out to my Shanghai colleagues, the more difficult-to-swallow Fast Failure Imperative that necessarily accompanies rapid learning, adaptation, and improvement. "Fail. Forward. Fast."—that was the advice from a high-tech CEO who attended a seminar of mine years ago. David Kelley, IDEO design: "Fail faster, succeed sooner." And the word/s according to Nobel Laureate (Literature) Samuel Beckett: "Fail. Fail again. Fail better."

My point to my colleagues: "IT IS NOT NEARLY ENOUGH TO 'TOLERATE' FAILURE—ONE MUST CELEBRATE FAILURE."

To move fast, adjust fast, take advantage of the constant dialogue-conversation discussed above ("ask"-"listen"), one must be "trying new stuff"—all the time and at a ferocious pace. Tryin' new stuff means screwing up constantly—then adjusting fast with a new try ("Fail. Fail again. Fail better."). At the heart of the matter—yes, the heart—is the wholesale celebration (CEL-E-BRA-TION!!) of failure. As NYC Mayor/entrepreneur Mike Bloomberg aptly put it: "In business, you reward people for taking risks. When it doesn't work out you promote them—because they were willing to try new things. If people ... tell me they skied all day and never fell down, I tell them to try a different mountain."

Ask.
Listen.
Fail.

And: Succeed.

Point #5/Life Success.

Dave Liniger founded the real estate colossus RE/MAX. He says that putting the customer (home purchaser) first is not the way he looks at things. To have sustaining success with customers his field team must be learning, growing—succeeding. Making that field team a passel of superstars on the march is the principal point of the exercise. Hence he delightfully states of RE/MAX:

"We are a life success company."

Remember my initial challenge to make the organization: ... an emotional, vital, innovative, joyful, creative, entrepreneurial endeavor that elicits maximum concerted human potential in the wholehearted service of others—e.g., Employees, Customers, Suppliers, Communities, Owners, Temporary partners.

That comes, in the end, from a team hellbent for vigor-enthusiasm-growth-learning-service-life success. I'll go further and insist that over the long haul, Service Excellence (and every organization exists only to serve!) cannot be sustained unless those who are called upon to provide it day in and day out are fully engaged in a Quest for Excellence—my words for "life success." (I think, from my contact with him, that Dave L. would gladly sign off on that.)

I'll end this section by repeating an earlier message: Creating "life successes," like listening and asking, goes way beyond our borders. Our goal is an encompassing team striving for collective Excellence—staff, customers, vendors, etc. A great company aims not just to "satisfy" its customers—but to contribute to their individual and collective growth and success—to help its customers achieve Excellence. A great company aims to stretch its vendors in their quest for growth-success-Excellence. Creating "life success" sagas, then, is an inclusive adventure.

Point #6/Excellence.

Anonymous, from tompeters.com:

"Excellence can be obtained if you:

... care more than others think is wise;
... risk more than others think is safe;
... dream more than others think is practical;
... expect more than others think is possible."

Excellence.
Always.
If Not Excellence, What?
If Not Excellence Now, When?

So there you have it, or, rather, there they (my Chinese colleagues) had it/have it. Tom's "Six-step Program, Circa 2009."

The Hotel Pulitzer here in Amsterdam has a fabulous location (in the exact middle of things), etc., etc. But on my Short List of Lustworthy Attributes it scores a Perfect Ten on three, whereas even the best of the best are often awful on All Three!!

(1) Windows that can be flung Waaaaaaay Open!
(2) A Veeeeeeery Bright bedside lamp.
(3) WiFi that actually is easy to connect to and, so far, has a great signal that isn't interrupted. (I CANNOT TELL YOU—IN 2009—HOW MANY HOTELS HAVE WIFI THAT CAN ONLY BE GRADED "SUCKS STUPENDOUSLY.")

Give me those three, a clean duvet and toilet and shower, and I'm a Happy Camper!

Picture above: Spring comes to Amsterdam, a canal view—what else? Picture below: House boat—I called Susan; I want one!

(I admit that I teared up. But, then, like my idol, Winston Churchill, I do that a lot.)

Comment: "Suppose we had done both—apply Japanese style management (invented by an American by the way) and also still had our IBM's, HP, J&J's etc. I think In Search of is partly responsible for the downfall of manufacturing because it became uncool."

TP/me: (1) Wrong book; In Search was almost all manufacturers—it was Liberation Management, in 1992, that focused on services—and I wouldn't change a word, or at least not many. (2) Manufacturing is hardly dead in the U.S.; that is hogwash; it's microchips and software and biotech and medical devices, not so much autos; mfg as a share of GDP has been pretty much steady, or no more than a tick down, for years in the U.S.—it just doesn't take many people to make things anymore (that's called productivity improvement, the #1 engine of economic growth). (3) Every major economy in the world, even Germany, is a "service economy." Period. (4) Remember that the "service" part includes "services added" to manufacturing—consider the likes of GE Aircraft Engines, GE Power Systems, GE Medical Devices—over half the revenues of these outfits comes from "services added," such as life-cycle service packages for customers. (5) Last time I heard, IBM-J&J-HP were all three very alive and very well—e.g., HP just became the first $100-billion computer company in the world! (6) The Japanese economy has been in or near the tank for a decade-and-a-half now; not clear they're a great role model; among other things, Japan doesn't generate many entrepreneurs (which is crippling at a time of tech change), and they've had to "offshore" a ton of manufacturing as their wages soared—a good thing. (7) Fact is, we did indeed re-import many if not all the "Japanese techniques," such as TQM and Continuous Improvement—and our car companies' problem is not manufacturing quality, which is by and large at parity with the Japanese, Koreans, etc.; the problem is mostly high wages and benefits, which ordinarily would be called a good thing (e.g., improving workers' well-being); and by the way, Japanese auto companies' sales are as much in the tank as ours—for God's sake, even Toyota is reorganizing.

Back to you ...

(1) What utter hogwash!
(2) What an insult to our readers!

In Search of Excellence was what it was and wasn't what it wasn't. And it surely never meant to challenge or displace the Holy Bible, Koran, Torah, etc.

Here's the story in brief:

(1) American companies were being roughed up by the Japanese in the late '70s—the first post-War II challenge to American business supremacy.
(2) A couple of Harvard B-school professors, Bill Abernathy and Bob Hayes, put the blame largely on our management practices, as taught at their school, among others. In "Managing Our Way to Economic Decline" in the Harvard Business Review, they argued that we [Americans] were paying too much attention to the numbers, not enough to the "basics" such as product quality—sound familiar?
(3) Bob Waterman and I, resident in another blameworthy institution, McKinsey & Co., agreed 100%. But rather than follow the habit of the moment—urge Americans to adopt, lock, stock, and barrel, Japanese management practices—we imagined that there must be some Western-American businesses that still worked (we subsequently labeled them the "saving remnant").
(4) Bob and I sought out expert advice in the USA and Europe and got a ton of nominations. IBM topped the list, which also included the likes of HP, Johnson & Johnson, Disney, McDonald's, Intel, and Wal*Mart. Incredibly (as viewed from today), almost nobody had examined these firms! Fact was that the likes of the B-schools only examined failures at the time—we were about the first to look at successes. (About which, incidentally, the Globe author is clueless, attacking us for what was—in 1980, and everything must be viewed in context—our primary useful point of difference; namely, surfacing successful examples. We were the business equivalent of Abraham Maslow's approach to psychology; Maslow de facto invented "positive psychology," arguing that we also have to study healthy people—not just sick people, as professional psychologists were wont to do pre-Maslow.)
(5) Bob and I and our colleague David Anderson then went off and interviewed like maniacs for several months—mostly folks "down the line," rather than CEOs—this was another break from the regnant "research" tradition of the B-schools and consultancies. Based on those interviews and our extensive literature research, academic and popular, we reached some tentative conclusions. Key phrase: "tentative conclusions." Dear God in heaven, we never imagined for a moment, nor a second, or a micro-, nano-, or pico-second that we were performing research in the physical sciences from which we would extract definitive solutions along the lines of a theory of planetary movement or the effects of gravitational forces on the bending of light! We looked at a ton of interview data, had a ton of discussions, "tested" our conclusions in literally hundreds of seminars, and concluded, very un-scientifically, that "this looks pretty good"—and that doesn't. This approach was made clear as a bell to anyone who came across our stuff.
(6) About five years after the research started, with America mired in its worst recession since the Great Depression (sound familiar, redux?), we published In Search of Excellence. Unlike Peter Drucker, who avoided storytelling and naming names like the plague, we named names and told stories—and they resonated with a bushel of readers. Incidentally, along the way we dumped about 60%, I'd guess, of the originally nominated companies because we deemed their long-term financial performance to have been inadequate—using some pretty common measures and the prior 20 years' data. There was no rocket science here either—just a "sensible" approach to confirming that we were talking about some pretty good performers. Incidentally, it drives our critics nuts that our surviving companies, indeed experiencing ups and downs (duh!), have apparently continued to perform very well—a 2002 Forbes analysis, performed on the book's 20th birthday, concluded that an "excellence index" based on a basket of "our" companies' stocks had handily outperformed the Dow and S&P 500; given the date, 2002, this encompassed the dotcom boom and bust.

The above is not meant to be a "defense"—to the contrary! I repeat: In Search of Excellence was what it was and wasn't what it wasn't. I'd call it "useful"—and very different from its predecessors in an apparently useful way. Namely, to repeat, (1) about successful rather than unsuccessful companies and (2) loaded with practical stories. I suppose that instead of calling our generic conclusions, around which the book was structured, "eight basics," we could have called them "eight tentative conclusions" or "eight pretty good ideas."

The far more important point is—and this has apparently eluded 100% of our critics: Our readers are not idiots! They are pragmatic businesspeople or managers in the public sector or, pastors or priests or football coaches—the essence of the practice of management in all of these disciplines is indeed pragmatism! That is, our book (and others like it) do not appear in the "religion" section of the book store with the Bible on one side and the Koran on the other. Businesspeople, and police chiefs and fire chiefs and public works directors and elementary school principals, are neither looking for Biblical guidance nor full-blown academic theories of the Einsteinian or Darwinian or Newtonian sort. The are looking for ... "a couple of good ideas" they can use now. They are far more capable than Bob Waterman or I or Gary Hamel or Warren Bennis or Rosabeth Moss Kanter of deciding what's worth trying and what's not in their peculiar context—and when to start trying whatever and when to stop.

And, indeed, for thirty years or so now I, at least, have been trying to provide "a few useful ideas that you can get started on this afternoon."

I am being a bit disingenuous, I admit. There is a "constant undertone" to my thirty years of work. I'd call it that, a "constant undertone," not a Unified Theory of Everything. That is, I stood—and stand—behind the likes of (1) being and staying in touch with reality (MBWA, or Managing By Wandering Around, which Bob W and I found at HP in 1978), (2) putting people first (the likes of Dana Corp and Wal*Mart '78, Southwest Airlines today), (3) innovation through decentralization (3M, J&J then and now), (4) staying close to your customer (IBM then and now—with a few hiccups in between), (5) core values (the likes of McDonald's and W.L. Gore—Bob and I loved Ray Kroc's "QSCV," Quality, Service, Cleanliness, and Value, at McDonald's) and (6) doing now instead of talking forever (3M and HP were masters in '78).

Oh yeah, and the most important one of all: (7) Excellence per se! Bob and I may have been about the first to suggest that "excellence" ought to be as much an aspiration for businessmen as for would-be Olympians. That was our "ardent belief"—and did not in any way pretend to be "teased from the data." "Excellence" was, is, and shall ever be totally subjective! And the notion, I'm delighted to say, seemed to have resonated then—and resonates now.

I'm willing to stake any modest usefulness of my career on the "usefulness" of these seven ideas, and a few more that are absent courtesy space constraints. And stake any modest usefulness, far more important, on having listened to and then done my best to share some terrific stories told to me by the likes of Bill and Vieve Gore of W.L. Gore, Frank McGuire of FedEx, Herb Kelleher at Southwest Airlines, or Master Educator Dennis Littky.

There you have it.

But not quite.

I must inject one sour—and sad—note. Jerry Porras and Jim Collins are pals and colleagues of mine. I think Built to Last was a terrific book with a ton of those "pretty good ideas" between the covers. (Though I don't really like the idea of merely "lasting" as an aspiration—but that's just me.) Likewise, I think Jim's Good to Great is terrific—loaded with "pretty good ideas" that are of immediate use. (Though again I have nitpicks.) But Jim and I are on absolutely opposite sides of the fence, indeed the universe, on two things he wrote or apparently said to the Globe guy. I went out of my way repeatedly to say to the Globe reporter: "The 'research' represented by the In Search of Excellence 'product' should never, ever be confused by the research-experimentation performed to confirm Einstein's theory of relativity. That is not nor will it ever be the standard in the so-called 'social sciences.'" In fact I added that I was one of the ones who think it's a travesty to award a Nobel in economics—economics ain't physics either, as you'll discover when you next check the status of your 401(k). Well, Mr Collins apparently disagrees! Not only does he compare his [note the italics] research to physics, but he also claims to have discovered "immutable laws of organized human performance."

Dear God!
Or, rather, God help us.

Alas, with those claims, I'm afraid Jim gives the Globe writer a boost beyond the fellow's wildest dreams! If "we"-the-gurus [I despise that moniker, by the way] think we are in the business of discovering and propagating "immutable laws," then we deserve all the opprobrium of the Globe writer, the rest of our critics, and our readers-customers.

As I said, Dear God!

NB: I have no desire to defend In Search of Excellence—the fact that some people are still pissed off about its success 27 years later is good enough for me! I am writing this almost entirely because of my irritation with Mr. Collins.

"I'm one of the very lucky 434 employees at Bollinger that were the beneficiaries of Jack's largesse. It was a wonderful gift, but not a huge surprise—Jack Windolf lives his life this way—in appreciation of all that he has and all that his employees contribute to the business. I've worked for him for 16 years and I can tell you, Jack is a class act and so is the company he's built. And I do mean 'built'—he's no flash in the pan CEO hired last year, but someone who's spent 40+ years of his life building something worthwhile and lasting. Bravo, Jack."

Bravo!

Oracle and Methodist got me thinking about how much is working and moving in the U.S. economy, though you sure as hell wouldn't know it from the press and its pundits—or the President's schedule-of-gloom.

We are getting the tar beaten out of us, to be sure, but the "American narrative," circa 2009, does not begin and end on Wall Street and/or Detroit.

The good news keeps pouring out of our research universities and medical centers. The good news is marked by venture-funded startups in every aspect of information technology (from materials research to devices to the Internet and other media) and biotechnology and renewable energy and green enhancements and materials science and medical devices. (And. And. And.) The good news is that the race is still on and excitement is still high in the likes of Houston and Austin and San Antonio and Seattle and Silicon Valley-SF-Berkeley and Boston-Cambridge and Madison and Raleigh-Durham and Champaign-Urbana and Northern Virginia-Bethesda and San Diego and LA. (And. And. And.)

No, my glasses have not acquired a rose-colored tint. But they haven't entirely fogged over either. Give up on the U.S.A. for the next 10 years? Fill your wardrobe with hair shirts? What a joke. The best may or may not be yet to come—but there's a lotta "best" going on around us every minute of every day.

I don't recommend a Grade A sinus infection as an excuse, but c'mon down to Houston Methodist Med Center—and watch America shine at what we shine at. You'll be blown away!

1. Action! "Bias for action." "Ready. Fire. Aim." "You miss 100% of the shots you don't take."
2. Failure. "Whoever makes the most mistakes wins." "Reward excellent failures, punish mediocre successes."
3. Execution! "The last 98%." Enjoy-master the politics or flunk out. The invisible "underbelly" is the key!
4. Great things, small packages. Germany's Mittelstand.
5. Not cool coolest of the cool. Basement Systems Inc. Jim's Group, 2,800 franchisees, masters of dog-walking.
6. Big 4. TP's "4 for 40," 4 things I've learned in 40 years. Decentralization. Execution. Accountability. 6:15AM.
7. Clarity around core values. For living, not for shareholders—best way for shareholders to win.
8. Organizations exist to serve. Period.
9. People first. "Life success company." "Put the customer second." "Cathedrals devoted to human growth."
10. "What do you think?" "Dream manager."
11. Quality obsession.
12. No corner-cutting in tough times.
13. Design-produce Brilliant/Memorable Experiences. Everywhere. Accounting Dept. as Cirque du Soleil.
14. Keep climbing the value-added ladder. Best Buy/Geek Squad. IBM Global Services.
15. Department as "PSF"/Professional Service Firm. From "overhead" to "principal engine of value-added."
16. "Insanely great." "Only ones who do what we do." "Radically thrilling." Words matter!
17. Emotions rule. Always.
18. Brand You. Declaration of Independence. "Distinct or extinct."
19. Design. Apple. Apple. Apple.
20. Innovate or die. "You must be the change you wish to see in the world."
21. R&D imperative in tough times.
22. You are who you hang out with. "Hang out with weird, get weird. Hang out with dull, get dull."
23. Diversity for diversity's sake.
24. Nudgery/Multiplier power/Little = Big. Pronovost's ICU check list. Etching in the urinal.
25. Location power. The #1 underutilized invisible megalever.
26. "Business model." Microsoft. "This is how we make money in 25 words or less."
27. Obsessive-compulsive relationship development and maintenance. Measure it! Focus on the "underbelly"!
28. Crowdsourcing.
29. BlogPower.
30. Decency. Thoughtfulness. Value is X10 in tough times.
31. Smile. Nelson Mandela. D.D. Eisenhower. Starbucks.
32. Give good tea. Ben Franklin.
33. Dance your way to a world-altering alliance in 96 hours. Edward VII.
34. "Thank you."
35. Apologize. Make the 3-minute call. "Three-minute call hour."
36. Comeback power. Comeback > Perfection.
37. "Kindness is free."
38. Transparency.
39. Accountability.
40. Enthusiasm. Energy. Exuberance.
41. Hiring #1. 2 per year/promotion power. 1st line supervisor power.
42. Pick "people people." Select-for-intangibles.
43. Resilience. "We'll lick 'em tomorrow."
44. Appetite for tough times. Tough times define your life.
45. Calendar management. "Calendars never lie."
46. "Hard is soft. Soft is hard." "0 for 15."
47. Women Are the Market. "Womenomics."
48. Women rule. Women are the best leaders.
49. Boomers-geezers have all the $$$$$.
50. Integrity.
51. Wildly "over-communicate," especially in tough times.
52. XFX/Cross-functional excellence = Lunch management.
53. Listening. Listening-as-strategy. Hearing > Listening. Become a student!
54. Know yourself—far easier said than done.
55. MBWA/Managing By Wandering Around. "In touch" power. Measure it!
56. Show up in tough times.
57. EXCELLENCE. ALWAYS.

Bravo, for the decency, for the marketing value, and for unadulterated creativity!

If Not Excellence, What?
If Not Excellence Now, When?
The "19 Es" of Excellence:

Enthusiasm. (Be an irresistible force of nature!)
Energy. (Be fire! Light fires!)
Exuberance. (Vibrate—cause earthquakes!)
Execution. (Do it! Now! Get it done! Barriers are baloney! Excuses are for wimps! Accountability is gospel! Adhere to the Bill Parcells doctrine: "Blame no one! Expect nothing! Do something!")
Empowerment. (Respect and appreciation rule! Always ask, "What do you think?" Then listen! Then let go and liberate! Then celebrate!)
Edginess. (Perpetually dancing at the frontier, and a little or a lot beyond.)
Enraged. (Determined to challenge & change the status quo!)
Engaged. (Addicted to MBWA/Managing By Wandering Around. In touch. Always.)
Electronic. (Partners with the world 60/60/24/7 via electronic community building and entanglement of every sort. Crowdsourcing rules!)
Encompassing. (Relentlessly pursue diverse opinions—the more diversity the merrier! Diversity per se "works"!)
Emotion. (The alpha. The omega. The essence of leadership. The essence of sales. The essence of marketing. The essence. Period. Acknowledge it.)
Empathy. (Connect, connect, connect with others' reality and aspirations! "Walk in the other person's shoes"—until the soles have holes!)
Experience. (Life is theater! Make every activity-contact memorable! Standard: "Insanely Great"/Steve Jobs; "Radically Thrilling"/BMW.)
Eliminate. (Keep it simple!)
Errorprone. (Ready! Fire! Aim! Try a lot of stuff and make a lot of booboos and then try some more stuff and make some more booboos—all of it at the speed of light!)
Evenhanded. (Straight as an arrow! Fair to a fault! Honest as Abe!)
Expectations. (Michelangelo: "The greatest danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it." Amen!)
Eudaimonia. (Pursue the highest of human moral purpose—the core of Aristotle's philosophy. Be of service. Always.)
Excellence. (The only standard! Never an exception! Start now! No excuses! If not Excellence, what? If not Excellence now, when?)

The stories of real heroism from last Friday's miraculous experience are plentiful and heartwarming. Thank goodness for the sheer dedication of the professionals who got involved in the landing and rescue missions that saved the lives of all passengers and crew. In particular, the pilot has been rightly praised for his skill and devotion to duty.

But how about the amazing resilience of the aircraft that survived this most extreme of circumstances? Just how do you design and build an aircraft that can cope with the failure of two engines, followed by the crash landing in the water ... with pretty much every piece intact?!!

For many years, I have enjoyed working with engineers and manufacturing folks from different parts of the aerospace industry. We've had many an intellectual tussle over their propensity to check and re-check, with me encouraging them to "see failure as part of the learning process." But when you see something as astonishing as Friday's emergency landing on water, you can see the payoff for their discipline and consistency. Okay, so future excellence in aerospace will be dependent on some lateral and out-of-the-box thinking, but let's not forget to treasure the mastery and expertise that delivers today's excellence. Bravo ladies and gentlemen of the aerospace industry!