By Larry Bossidy and Ram Charan
Crown Business -- 278pp -- $27.50
With so many chief executives dodging investigations, taxes, or shareholders' wrath these days, the term "execution" conjures up ominous images. But it's just what Corporate America needs most right now, according to Larry Bossidy, chairman of Honeywell International Inc., and management guru Ram Charan. In Execution: The Discipline of Getting Things Done, they attempt to explain why visionaries often fail and what steps leaders must take to translate their strategies into results.
The authors often use a tag-team approach: Bossidy will reminisce about his management experiences, then Charan provides analysis and anecdotes of his own. The formula that emerges for success in leadership may sound familiar, but it's well worth repeating: The CEO must be obsessed with the business, nurturing the most capable people and creating a truly performance-based culture. Think big, say the authors, but don't kid yourself. Their volume is a thorough if somewhat unexciting guide to making ideas work.
If this description sounds like a setup for yet another ode to General Electric Co. (GE
) and Jack Welch, that's because it is, at least in part. Bossidy logged 34 years at GE before leaving in 1991 to head AlliedSignal Inc., and Charan is one of the few consultants allowed into GE's inner circle. Welch is often cited as the quintessential execution artist--praised for everything from his "boundaryless corporation" to his informal let's-get-it-done style. The former GE chief returns the compliment with a glowing endorsement of the book plastered on its front cover. Other role models include Sam Walton of Wal-Mart Stores (WMT
), Herb Kelleher of Southwest Airlines (LUV
), and Dick Brown of EDS (EDS
). The authors name only a few failed leaders. One is Richard C. Thoman of Xerox Corp. (XRX
), a somewhat cerebral former McKinsey & Co. consultant and IBM (IBM
) exec who, the authors say, never broke through the copier company's "clubby culture" to get support for his bold initiatives. The result: poor morale, angry customers, and operational chaos. Richard McGinn of Lucent Technologies Inc. (LU
) also gets a slap for setting "unrealistic goals" and being "completely out of touch."
Unfortunately, most of the other anecdotes involve anonymous actors--or are hypothetical, stuffed with characters named Joe or outfits named XYZ Co. Given that there's no dearth of well-known failures to dissect, this adds a slightly evasive tone to the proceedings. Throw in cryptic charts and some corporate jargon, and this otherwise useful guide at times becomes tedious and opaque.
Even Bossidy's own stories are oddly lacking in color or introspection. If he has made any mistakes or suffered through any disappointments in his career, we don't hear about them. After his 1999 retirement, Honeywell (HON
) and GE attempted a merger but were unsuccessful. This, plus Honeywell's subsequent floundering, would seem to signal a colossal failure of execution on somebody's part--but the events are barely mentioned. Bossidy's only criticism of Honeywell is that a culture of execution, in place at the time of his retirement, fell apart, prompting his return two years later. Some of his initiatives were too mired in problems to be salvaged. Yet, he suggests, by September 11, the execution culture was sufficiently back in place for the company to respond quickly to the new environment. With the chairman set to retire again on June 30, some might wonder if Honeywell's fortunes are too closely tied to one man.
Bossidy and Charan would emphatically argue that the answer is no. For leaders to have real success in execution, say the authors, they must build a culture of A-players who are empowered to carry out their own strategies and who get directly rewarded for each accomplishment. Both men scoff at the notion of compensating people within a narrow range. Writes Bossidy: "Differentiation is the mother's milk of building a performance culture." As someone whose salaried jobs have made him a millionaire many times over, he ought to know. To these writers, a top-notch process for developing and assessing people is more important than devising a strategy or streamlining operations. It gives companies the discipline, flexibility, and bench strength to thrive in any environment. A company can easily replace anyone who leaves on the same day--as GE did when Larry Johnson left its appliance division to head the Albertson's Inc. (ABS
) supermarket chain last year.
Still, the book makes it clear that many a failed company is staffed with bright, well-paid people who are misdirected, demoralized, or working at cross purposes. They require robust, realistic strategies and "action" plans if they are to succeed. Execution offers thoughtful questions to consider when building a strategic blueprint.
The volume's final section addresses how to develop a process for operations--linking where the business wants to go with who's going to get it there. A chapter on this topic considers, among other things, "How to Build a Budget in Three Days" and "The Art of Making Trade-offs."
Clearly, Execution isn't a beach book. The authors care more about offering practical advice than crafting a lively read. Still, if even half the corporations in America pondered their suggestions, the economy might be in much better shape. Moreover, Bossidy and Charan boast an impressive enough track record that anyone who wants to stay sharp at the helm will welcome their assistance. Brady covers corporate strategies from New York.