Management thinker Jason Jennings, in an interview with BUSINESS TODAY, describes what companies need to do to flourish in a nanosecond culture.
Q. Do small companies have an advantage in the race to be fast?
A. Size has nothing to do with being fast or slow. By the time the companies have been fortunate enough to survive and become large, almost all have lost touch with their original, clearly defined sense of purpose and guiding principles. Generally, both the original sense of purpose of doing well by doing good and the guiding principles have been replaced with slow moving bureaucracies.
But, when everyone in an organisation - large or small - knows and buys into the purpose of the company and knows, understands and is empowered to act in accordance with the guiding principles, speed occurs naturally. I'll bet any amount of money that if you asked the CEOs of Amazon, Google and Apple if they could name their company's guiding principles they'd look at you like you just fell off the back of a turnip truck and would respond with an incredulous: "How in the hell can anyone hope to lead a company if they don't know its guiding principles?"
Sadly, of the over 200,000 companies we've screened and studied in the past decade, the CEOs of fewer than two-dozen were able to recite their own companies' guiding principles. Ergo, their companies had none and each decision had to be laboriously discussed, debated and pondered to death.
Q. Even if a company is ahead of the competition today, the customer is often faster. How do companies stay ahead of the ever-changing customer?
A. There's only one way to stay ahead of customers. Everyone, at every level of the organisation - from the CEO down to the shop floor - needs to be in constant dialogue with the customers asking the questions: "Tell me your story, tell me your hopes, aspirations and dreams for you and your family?" "Tell me your fears and what keeps you awake at night?" "What itch do you have that we can scratch and what pain points do you have that we can possibly make better?"
There's no better example of a company where everyone listens to the customers than P&G. They've been around for 180 years, have generated trillions in revenues and hundreds of billions in profits and are on track to have more than five billion customers worldwide in the near future. At every offsite the company conducts - and it's in thousands each year - the business is conducted in the morning and the afternoon is spent calling on the stores who sell their products and the consumers who have the ability to purchase them and everyone, from CEO A.G. Lafley down, takes part in these house calls and meetings. The purpose of the meetings isn't to sell the company's products but to learn about people, gain insights into how they live, what they dream, and the hopes they have for their families. The typical top leadership of most companies would tremble in their boots before they'd ever put themselves into the position of having to actually go out, spend time in their customer's home and talk to people.
Q. In your book, in the chapter on stewardship, you talk about the no-negativity trait that leads to success, though you do mention a screaming Gordon Ramsay. But can successful stewards be both Mr Nice as well as demanding and irascible?
A. I hope when people read about the screaming Gordon Ramsay in my book, they don't think I was holding him up in a positive light. I find his behaviour most offensive and objectionable. It's our finding that great stewards are, by their very nature, compassionate and caring, challenging and also demanding, and very impatient. If you're trying to do the right thing and improve everything for five different constituencies simultaneously you would of necessity be driven and impatient. Who would be willing to be slow if you're doing what you consider to be the most important work in the world? Good stewards are, of course, impatient and demanding but not irascible. Irascible is defined as being hot tempered for the sake of being hot tempered.
Q. Does the age of workforce matter when it comes to speed of decision and delivery? Is a tech start-up with digital natives more attuned to fast decisions?A. I love being around digital natives and agree they have a better grasp of all things digital than digital orphans - and possibly a little more physical energy as well. Show me a group of people who know, believe and share a singular purpose; who know and are empowered to act in accordance with the same set of guiding principles; where everyone is committed to never violating the immutable law of suckage when it comes to the customer; where everything possible has been systematised so the focus can be on growth; where the prosperity of all team members is ever present in the minds and the actions of the leadership; where the organisation is committed to doing well by doing good; and I'll show you a truly high-speed company regardless of the team's age.
Q. Are service companies usually faster than product companies?
A. It's an excuse used by some product-based companies to try and justify why they're so slow. An example is H&M where they can go from a design on a drawing board to in store display worldwide within three weeks. Any company that applies the principles described in the book to their supply chain can dramatically reduce the time to market.
Q. Can being fast prove to be more expensive for companies since there might be more mistakes?
A. Truly high-speed companies are committed to making many small bets and each doesn't have to be a winner. When Howard Schultz returned as CEO of Starbucks, the company had fallen on hard times. Revenues had declined by a couple of billion dollars to less than $10 billion and the pundits were proclaiming that both Starbucks and coffee had become passé.
Schultz made a renewed commitment to the original sense of purpose and guiding principles and embarked on a path of making many small bets. During an 18-month period, the company made 150 small bets. Most weren't successful. But all it took were a handful: Starbucks Petites (their dessert line), Via instant coffee, wine and beer testing, the renovation of their stores, the introduction of oatmeal, a few strategic acquisitions to bolster their tea, fruit juice and food offerings. Today you have a company firing on all cylinders, a footprint of 19,000 locations worldwide, on track to $20 billion in annual revenues and a 20 per cent operating margin.
Q. Are companies from certain regions culturally prone to taking measured elephant-like steps, while others (China) are dragon-like geared for speed?
A. Yes, there are regional, geographical and cultural differences that prevent companies from being high-speed enterprises. You cannot achieve and maintain velocity until you rid the organisation of bureaucracy (which neither creates nor adds any value), blow up long entrenched silos, create cultures of transparency which results in true accountability, create a culture of making lots of small bets (all of which don't have to succeed), and have a leadership in place that's committed to the prosperity of every worker. Ultimately you make the shareholder number one by making them last; behind the workers and the customers.
Q. Have you studied any Indian companies and if so, which one in your view is geared for creating urgency?
A. Despite a planned merger that would have made the company the seventh-largest tyre maker in the world not going through, my bets are still on Apollo Tyres and my friend and colleague Neeraj Kanwar, its Managing Director. He truly gets the need for a single unified culture, understands it can only be achieved through a set of guiding principles shared by everyone and they are doing some very exciting work in that area.
(Jason Jennings is an authority on leadership, growth and innovation, and the author of the soon-to-be-released The High Speed Company)