New approaches to better business
With the economy in a slump and business leaders exposed as common crooks, it's time to return to business basics or so it would seem. Some experts argue just the opposite, maintaining that scandals and declining profits are a sure sign it's time for radical change in how we think about business. This month we take a look at different perspectives on today's business climate with three new books that challenge the way business gets done.
Getting back to the basics
Author Kirk Cheyfitz hammers home 12 timeless truths of business in the insightful, fun-to-read Thinking Inside the Box: The 12 Timeless Rules for Managing a Successful Business (Free Press, $25, 272 pages, ISBN 0743235754). Cheyfitz says we "can't think outside the box or even inside the box unless we have a very precise idea of what the box is." By following the 12 unchanging rules or "planks" that make up the box, the authors say a business can survive any passing fad or temporary disaster.
It's a waste of time to try to create a new business model, he says, because there aren't any. There's no waffling with Cheyfitz, and his concise, self-assured wisdom is hard to dispute. Dotcoms are a frequent target of his box-breaking examples, and in retrospect, it does seem obvious that spending a little more time on business necessities (second plank in the box: the first business of business is making money) would have served the paper billionaires well. Other elements of the box include hiring the best people, creating customers with every transaction and paying close attention to true revenues, expenses and cash flows. Cultivating new growthInstead of getting back to the basics, the author of The Art of Profitability explains "a different way to grow" in a world of product saturation and market crashes. How to Grow When Markets Don't by Adrian Slywotzky and Richard Wise says the old growth model invent a great product, sell it to death, go international, cut costs and raise prices if you can has run out of steam. Product innovations no longer generate big bucks, and international expansion and acquisitions have largely been depleted.
So how can companies grow in tough environments? Simply put, they should stop thinking about the product and start addressing the hassles and issues that surround the product to create new types of demand from customers.
Fascinating case studies of ventures like GM OnStar and John Deere Landscapes demonstrate how mature companies have taken a new look at solving their customers' biggest problems. Even in areas that were thought incapable of growth, these innovative companies have created new revenue streams by deploying hidden assets customer relationships, information, real estate to meet the next generation of demands from customers.
Putting people above profits
Leaders like Tony Blair, former President Bill Clinton and Super Bowl champ Jimmy Johnson were inspired by Mihaly Csikszentmihalyi's groundbreaking book Flow, which explained why some people lose themselves in their work. Now the author brings the concept of flow to the workplace in Good Business: Leadership, Flow, and the Making of Meaning (Viking, $24.95, 256 pages, ISBN 0670031968). The author dares to put people above profits, saying, "Fundamentally, business exists to enhance human well-being." Interviews with successful leaders (whose sole ambition isn't selfish advantage) show how leaders can bring flow to the workplace and what they should avoid. The global perspective includes visionary leaders all over the world who have transformed stifling jobs and workplaces into exciting vocations. For example, outdoor equipment maker Patagonia has a "Let My People Go Surfing" policy. At any time of the day, employees can take off and go surfing. It's an "attitude that changes your whole life," says Yvon Chouinard of his happy company headquarters. Plush, ostentatious surroundings may lie; look for onsite childcare, cheerful cafeterias and the demeanor of the people for insight into workplace happiness.
Good Business is an important book for managers who want to increase productivity, and a must-read if your business heroes aren't Machiavelli, Genghis Khan or Attila the Hun.