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Get Four
|  | JUNE 9, 2004
Larry Bossidy on Execution and Reality The best-selling author talks about why companies need to review their business models and "act before it's too late" Larry Bossidy is the rare former CEO who has made a seamless and highly successful transition into a second profession. Execution: The Discipline of Getting Things Done, written by the former chairman and CEO of Honeywell International (HON ) and AlliedSignal with management consultant Ram Charan, has been one of the very few successful management books of recent years. Since its 2002 publication, the book has sold hundreds of thousands of copies, spent 23 straight months near the top of the BusinessWeek Best-Seller List, and been translated into 19 languages. In October, Bossidy and Charan will publish a second book, Confronting Reality: Master the New Model for Success. Bossidy hasn't completely moved out of corporate life: He continues to serve on the boards of three corporations -- JP MorganChase (JPM ), Merck & Co. (MRK ), and Berkshire Hills Bancorp (BHL ). He is also an adviser to Aurora Capital Group, a leveraged buyout firm. But the role of author seems to suit him well: On June 4, Bossidy schmoozed with booksellers at BookExpo, the publishing industry's mammoth trade show held in Chicago. There, he spoke with BusinessWeek Associate Editor Hardy Green. Edited excerpts of their conversation follow: Q: Execution has been on the BusinessWeek Best-Seller List for 23 straight months. Has its success been a surprise to you? A: Yes. There had been so much discussion on strategy and so little attention paid to execution. I had in-depth knowledge of two or three companies, and Ram Charan had knowledge of maybe 400. We felt we knew what needed to be said. And the book came to market at a good time: As the world gets ever more competitive, it simply takes better execution than ever before. Q: Both Execution and the upcoming book, Confronting Reality, openly admit to being about the fundamentals. Do you think there's a certain skepticism about "big idea" books nowadays -- a wariness of hype after the tech bubble? A: I don't know about skepticism, but there's a lot of similarity about those books. Readers may say to themselves, "I don't know that there's anything new here." The true big ideas may not be recognized as such until a long time after they've been implemented. Management is a series of things that work in synchronicity. It's the totality of them that turn out to be a big idea. Q: Is Confronting Reality a sequel? A: Not in my mind, although we are addressing the same audience. This book adopts a different approach: We're saying that there's a lot on the horizon that you need to understand. When you digest what's going on globally, where does your company really stand? Q: The new book concentrates on the business model -- how to examine your business' model, how to figure out if it's time for a radical reinvention or whether only minor adjustments are needed. Could you comment? A: I don't know what should be done in such industries as automobiles and the airlines. Those business models don't work now, and it may be too late for them. We're saying, "Look at your business model and the world around you. If you can see a storm coming, you have to act before it's too late." There are a lot of businesses that, with their current strategies, can't go on existing. We give a lot of examples: Other companies that are being seriously challenged are Wal-Mart's (WMT ) competitors in the food business. But Confronting Reality isn't necessarily comprehensive. We're encouraging executives to take a hard look at their businesses and see where they fit in the new world. In today's environment, when you see change is beginning to trickle down, you should bear in mind that the trickle down gets to you a lot faster now. Q: Both of your books place some emphasis on personnel matters -- getting the right people in the right place, rewarding "doers," and so forth. What would you say is the largest personnel question facing business today? A: We may not be developing people, giving them the necessary training and exposure to take on more demanding assignments. American colleges and universities are the best in the world. But today's workers want more from life and work than their predecessors did, and employers have to take care of that. Q: There haven't been many books written by CEOs lately, probably because of the crisis of CEO legitimacy following Enron and other corporate scandals. Have events led to changes in the executive suites? A: In the future, there will be a better correlation of executive compensation and corporate results. You won't be seeing people getting outlandish compensation when the company's stock didn't do so well or when its profitability is suffering. Q: Will you be writing more books? A: Only if we can make a real difference. There's no more room for "me-too" books that just say the same thing.  Edited by Patricia O'Connell
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