Thriving in Uncertainty: Strategies for Leading in the New Economy

1. Tom Peters’We Are in a Brawl with No Rules!Baltimore/13December2001

2. “There will be more confusion in the business world in the next decadethan in any decade in history. And the current pace of change will only accelerate.”Steve Case

3. Uncertainty: We don’t know when things will get back to normal.Ambiguity: We no longer know what “normal” means.

4. BMcC: (1) Hierarchy vs. “Network organization.” (2) NWO = “Doctrine as center of gravity”/source of motivation; distributed support & decision-making;largely self-organizing; “outside the military sphere.”

5. From: Weapon v. WeaponTo:Org structure v. Org structure

6. “Our military structure today is essentially one developed and designed by Napoleon.”Admiral Bill Owens, former Vice Chairman, Joint Chiefs of Staff

7. <1000A.D.: paradigm shift: 1000s of years1000: 100 years for paradigm shift1800s: > prior 900 years1900s: 1st 20 years > 1800s2000: 10 years for paradigm shift21st century: 1000Xtech change than 20th century (“the ‘Singularity,’ a merger between humans and computers that is so rapid and profound it represents a rupture in the fabric of human history”)Ray Kurzweil

8. 1 day 2001 = Year’s trade in 1949, year’s FEX in 1979, year’s global calls in 1984. 1 day London FEX in 2001 = 30X year’s output in UK goods & services.Source: Charles Handy, The Elephant and the Flea

9. StructurePart I: Brand InsidePart II: Brand OutsidePart III: Brand Leadership

10. 7 Rules for Leading/THRIVING in a Recession+1. It’s ALREADY too late.2. Show up & tell the truth—CREDIBILITY rules.3. Kill with KINDNESS.4. Sharp pencils are imperative—but don’t forget that the CUSTOMER & our TALENT & RISKY INVESTMENTS are still our long-term Bread & Butter. 5. Everything’s different, everything’s the same—it’s the NEW ECONOMY, more than ever, stupid!6. “Use” the trauma to mount the bold initiatives you should have long before mounted: Flux =OPPORTUNITY.7. We’re in a War of Organizational Models—from retail to the Pentagon. IDEAS MATTER MOST.

11. Part I: Brand InsidePart II: Brand OutsidePart III: Brand Leadership

12. Forces @ Work IThe Destruction Imperative!

13. Forbes100 from 1917 to 1987: 39 members of the Class of ’17 were alive in ’87; 18 are in ’87 F100; the 18 F100 “survivors” underperformed the market by 20%; just 2 (2%), GE & Kodak, outperformed the market from 1917 to 1987.S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997.Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market

14. “Good management was the most powerful reason [leading firms] failed to stay atop their industries.Precisely because these firms listened to their customers, invested aggressively in technologies that would provide their customers more and better products of the sort they wanted, and because they carefully studied market trends and systematically allocated investment capital to innovations that promised the best returns, they lost their positions of leadership.”Clayton Christensen, The Innovator’s Dilemma

15. The [New] Ge WayDYB.com

16. The Gales of Creative Destruction+29M = -44M + 73M+4M = +4M - 0M

17. Brand InsideBrand Org:Lean, Linked, Internet-driven, Virtual

18. White Collar Revolution!

19. 108 X 5vs. 8 X 1= 540 vs. 8(-98.5%)

20. The Pincer 51. “Destructive” entrepreneurs/ Global Competition2. “White Collar Robots”3. THE INTERNET![E.g.: GM + Ford + DaimlerChrysler]4. Global Outsourcing[E.g.: India, Mexico]5.Speed!!

21. Automation+75% of what we do: 40 “expert” decision rules!

22. IBM’s Project eLiza!

23. “Unless mankind redesigns itself by changing our DNA through altering our genetic makeup, computer-generated robots will take over the world.”– Stephen Hawking, in the German magazine Focus

24. The Pincer 51. “Destructive” entrepreneurs/ Global Competition2. “White Collar Robots”3. THE INTERNET![E.g.: GM + Ford + DaimlerChrysler]4. Global Outsourcing[E.g.: India, Mexico]5.Speed!!

25. Brand InsideBrand Work: The Professional Service Firm Model

26. So what will be the Basic Building Block of theNew Org?

27. Every job done in W.C.W. is also done “outside” …for profit!

28. Answer: PSF![Professional Service Firm]Department Headto …Managing Partner, HR [IS, etc.] Inc.

29. “P.S.F.”: SummaryH.V.A. Projects (100%)Pioneer ClientsWOW Work (see below)Hot “Talent” (see below)“Adventurous” “culture”Proprietary Point of View (Methodology)W.W.P.F. (100%)/Outside Clients (25%++)

30. TP to NAPM:Youare the …Rock Stars of the B2B Age!

31. “P.S.F.”: SummaryH.V.A. Projects (100%)Pioneer ClientsWOW Work (see below)Hot “Talent” (see below)“Adventurous” “culture”Proprietary Point of View (Methodology)W.W.P.F. (100%)/Outside Clients (25%++)

32. BMW’s Designworks/USA: >50% from outside work

33. eHR*/PCC***All HR on the Web**Productivity Consulting CenterSource: E-HR: A Walk through a 21st Century HR Department, John Sullivan, IHRIM

34. Model PSF …

35. (1) Translate ALL departmental activities into discrete W.W.P.F. “Products.”(2) 100% go on the Web.(3)Non-awesome are outsourced (75%??).(4)Remaining “Centers of Excellence” are retained & leveraged to the hilt!

36. Brand InsideThe Heart of the Value Creation Revolution: PSF Unbound!

37. 09.11.2000: HP bids $18,000,000,000for PricewaterhouseCoopersconsulting business!

38. “These days, building the best server isn’t enough. That’s the price of entry.”Ann Livermore, Hewlett-Packard

39. HP … Sun … GE … IBM … UPS … UTC … General Mills … Springs … Anheuser-Busch … Carpet One … Delphi … Etc. … Etc.

40. “We want to be the air traffic controllers of electrons.”Bob Nardelli, GE Power Systems

41. “Customer Satisfaction” to “Customer Success”“We’re getting better at [Six Sigma] every day. But we really need to think about the customer’s profitability. Are customers’ bottom lines really benefiting from what we provide them?”Bob Nardelli, GE Power Systems

42. New Springs = TurnkeyCollections.Flexible sourcing.Packaging.Merchandising.Promotion.Systems & Site mgt.

43. Omnicom: 57% (of $6B) from marketing services

44. Who was the number one employer of architectureschool grads in the U.S. last year?

45. “The move toward outsourced manufacturing represents an obvious opportunity for contract manufacturers [such as Flextronics: $93M to $15B, ’93-’00], but it’s also a potential boon to product innovation. The future of gadget-making is not about making gadgets; it’s about imagining them. Someone else makes the imaginary real. ‘All that money that used to go to fund infrastructure is going into design and innovation,’ says Flex CEO Michael Marks.”Wired/11.2001

46. Brand InsideBrand You: Distinct … or Extinct

47. New World of Work< 1 in 10 F500#1: Manpower Inc.Freelancers/I.C.: 16M-25MTemps: 3M (incl. CEOs & lawyers)Microbusinesses: 12M-27MTotal: 31M-55MSource: Daniel Pink, Free Agent Nation

48. “If there is nothing very special about your work, no matter how hard you apply yourself, you won’t get noticed, and that increasingly means you won’t get paid much either.”Michael Goldhaber, Wired

49. Minimum New Work SurvivalSkillsKit2001MasteryRolodex Obsession (vert. to horiz. “loyalty”)Entrepreneurial InstinctCEO/Leader/Businessperson/CloserMistress of ImprovSense of HumorIntense Appetite for TechnologyGroveling Before the YoungEmbracing “Marketing”Passion for Renewal

50. Sam’s Secret #1!