EXCELLENCE.

ALWAYS.Tom Peters/Excellence Overview/20June2006

25

Good Night and Good

Luck.

Chicagoland’s

Mystery Disappearances …

THREE BILLION NEW CAPITALISTS

—Clyde Prestowitz

43,000

“Deutsche Bank Moves Half of Its Back-office Jobs to India”/

headline/FT/0327; 500 of 900 Research;

JPMorgan Chase—30% back-office by 12.31.07

Wal*Mart + Home Depot + Walt Disney +

Intel + Microsoft + Pfizer = Flat

Source: “Blue Chip Blues”, Cover, BW, 0417.06

New Economy?!

Genentech09, Amgen09

> Merck09 (70K-3/394B-5)

Good Morning and Good

News.

New Economy?!

Sergey + Larry >

Harvard/370

“Forget China, India and the

Internet: Economic Growth Is Driven

by Women.” —Headline, Economist,

April 15, 2006, Leader, page 14

EXCELLENCE. THE

MANDATE.

“If you don’t like change,

you’re going to like irrelevance even less.” —General Eric

Shinseki, Chief of Staff. U. S. Army

“It is not the strongest of the

species that survives, nor the most intelligent, but the one most

responsive to change.” —Charles Darwin

“We are in a brawl with

no rules.” —Paul Allaire

Sam’s Secret

#1!

“We made mistakes, of course. Most of them were omissions we didn’t think of when we

initially wrote the software. We fixed them by doing it over and over, again and again. We

do the same today. While our competitors are still sucking their thumbs trying to make the design perfect, we’re already on prototype

version No. 5. By the time our rivals are ready with wires and screws, we are on version

No. 10. It gets back to planning versus acting: We act from day one; others plan how to plan—

for months.” —Bloomberg by Bloomberg

"I think it is very important for you to do two things: act on your temporary conviction as if it was a

real conviction; and when you realize that you are

wrong, correct course very quickly.” —Andy Grove

“This is so simple it sounds stupid, but it is amazing how few oil people really

understand that you only find oil if you drill wells. You may

think you’re finding it when you’re drawing maps and

studying logs, but you have to drill.”

Source: The Hunters, by John Masters, Canadian O & G wildcatter

“Reward excellent failures.

Punish mediocre

successes.”Phil Daniels, Sydney exec

Nelson’s secret:

“[Other] admirals more frightened of losing than

anxious to win”

EXCELLENCE. STARTERS.

Radio City Music HallSeptember 2005

Franchise Lost!

TP: “How many of you [600] really

crave a new Chevy?”

NYC/IIR/061205

P.P.E.E.R.R.E.

People.Product.

Execution.Enthusiasm.Relentless.Re-invent.Excellence.

Franchise Lost!

TP: “How many of you [600] really

crave a new Chevy?”

NYC/IIR/061205

My (Les’s) Dinner with Henri

JUSTWHATIZZITUMAKE?

My (Les’s) Dinner with Henri

JUST WHAT IS IT YOU MAKE?

Did one of ’em ever turn to the other and say: “Wow, I

wonder what unimaginable new

tools, otherwise not possible, will be

brought forth for my daughter Alice, age

17, because of this deal?”

EXCELLENCE. THE WORD.

Synonyms

PurityTranscendence

VirtueEleganceMajesty

Antonyms

Mediocrity

EXCELLENCE.

GAMECHANGER1982.

Excellence1982: The Bedrock “Eight Basics”

1. A Bias for Action2. Close to the Customer3. Autonomy and Entrepreneurship4. Productivity Through People5. Hands On, Value-Driven6. Stick to the Knitting7. Simple Form, Lean Staff8. Simultaneous Loose-Tight Properties”

What is In Search of Excellence all about:

People. Emotion. Engagement. Exuberance. Action-Execution. Empowerment. Independence. Initiative. Imagination. Great

Stories. Incredible Adventures. Trust. Caring. Fun. Joy.

Customer-centrism. Profit. Growth. “Brand You.” “Dramatic Differences.” Experiences that Make You “Gasp.” Excellence.

Always.

ExIn*: 1982-2002/Forbes.com

DJIA: $10,000 yields $85,000 EI: $10,000 yields $140,050

*Forbes/Excellence Index /Basket of 32 publicly traded stocks

A Comment on Tom Peters in the Context of the Reagan Revolution …

“Tom Peters and Steve Jobs did more to make business cool ‘for the rest of us’ than any

others.” —Rich Karlgaard, publisher, Forbes

EXCELLENCE.

CAUSES.ADVERSARIES.

Hardball: Are You Playing to Play or Playing to Win? by George Stalk & Rob Lachenauer/HBS Press

“The winners in business have always played hardball.” “Unleash massive and overwhelming force.” “Exploit

anomalies.” “Threaten your competitor’s profit sanctuaries.” “Entice your competitor into retreat.”

Approximately 640 Index entries: Customer/s

(service, retention, loyalty), 4. People (employees, motivation, morale,

worker/s), 0. Innovation (product development, research &

development, new products), 0.

M.I.A.*: Talk. (Present.) Listen. (Interview.) Sell. (Life = Sales.) Do. (Execution-

Implementation.) Talent. (Recruit-Develop-Retain.) Project Management. (Create. Solicit

support. Execution. Adoption-Client “Culture Change.”) Product. (“It.”) Innovation. (Design.

Creativity. “Buzz-building.” Politics.) Leadership. (USMA, etc.) E.Q. (Connect.) “Culture”

Change. (Lasting impact.) Diversity. (Cross-

cultural Effectiveness.) Career Creation. (Brand You life-lifestyle.) Wellness. (Life.)

*B.Schools (“M.I.A.” or at most “B.I.A.”—barely in action)

Causes/1966-2006

Implementation/Small Wins (Stanford GSB/PhD thesis; 1st on implementation per se)

EXCELLENCE (as a worthy business pursuit)

Management Style/Corporate CultureSoft “Ss”/7-S (Waterman-Peters complete “business model”; waaaaay beyond Strategy & Structure)

Structure > Strategy (“We shape our structures, then they shape us …”—Churchillian paraphrase)

Soft Change Levers (> structure; symbols, patterns & settings)

Close to the Customer (novel idea, circa 1982)

MBWA (Managing By Wandering Around—courtesy a much more intimate than today HP)

Productivity through People (novel idea, circa 1982)

Chaos/Crazy Times Call for Crazy OrganizationsMiddle-sized companies are cool Re-imagine!/Innovate or Die!Small-ish/Scale & Synergy limits-delusions/anti-Big Mergers

Causes/1966-2006

Women/Market opportunityWomen/Leaders (right for the times)

Design/Design-as-soulWow! (Hot language)

Weird!Passion!/Enthusiasm!/Exuberance! (as Leader Lever #1)

Brand You (or else)

PSF = Bedrock (add value or bust—every group must demonstrate economic viability)

PSF + Brand You + WOW Projects = New Biz LogicSales/+R > -C (increasing revenue more important than cutting cost)

HealthCare/Wellness-Safety-H5N1Brand = Talent (best roster wins)

New VA Ladder/Products-Services-SOLUTIONS-EXPERIENCES-DREAMKETING (Dream Marketing)-LOVEMARKDifferent > > BetterBoomers & Geezers/marketing to new “mega-segment”

Adversaries

B-schools (crappy at soft skills, implementation, leadership)

Strategy-is-allBy-the-numbers managementDis-passionate managementFocus groupsIntuition discountedLeading as an intellectual taskLeading without passionCool language in Hot timesDilbert (accepting cubicle slavery)

Bigness per se (severe scale limitations—even at Microsoft)

White guys! (not really, but enough already)

18-44 emphasis in marketing (geezers > youth for foreseeable future)

-Cost > +Revenue (cost cutting more important than organic revenue growth)

CI (continuous improvement in an age of discontinuous world)

LESS THAN THE NO-HOLDS-BARRED PURSUIT OF EXCELLENCE

EXCELLENCE. RE-DEFINED.

“It is not the strongest of the

species that survives, nor the most intelligent, but the one most

responsive to change.” —Charles Darwin

Great Companies … SET THE

AGENDA.*

(Period.)

* “disturb the sleep of …

AGENDA SETTERS: “Set the Table”/ Pioneers/ Questors/ Adventurers

US Steel … Ford … Toyota … Sears … GM … ITT … The Gap … Limited …

Wal*Mart … Tesco … P&G … 3M … Intel … IBM … Apple … Nokia …

Cisco … Dell … MCI … Sun … Microsoft … Google … Enron …

Schwab … GE … Laker … Southwest … People Express … Ogilvy … Virgin

… eBay … Amazon … Sony … Amgen … BMW … CNN … Nike

Built to Last vs Built for Impact

“But what if [former head of strategic planning at Royal Dutch Shell] Arie De Geus is wrong in suggesting, in The

Living Company, that firms should aspire to live forever? Greatness is fleeting and, for corporations, it

will become ever more fleeting. The ultimate aim of a business organization, an artist, an athlete or a stockbroker may be to explode in a dramatic frenzy of value creation during a

short space of time, rather than to live forever.” —Kjell Nordström and Jonas Ridderstråle, Funky Business

EXCELLENCE.

RENOVATION2006.

X06/Excellence2006: The Bedrock Baker’s Dozen

1. A Bias For Action/Culture of Execution = Job One! 2. DECENTRALIZATION! ACCOUNTABILITY! 3. Fail. Forward. Fast.4. Velocity! Tempo! “Metabolic Management” Matters! 5. INNOVATE … or Die.6. A Damn Good Product. A Damn Cool Product.7. Ride the Value Added Curve to the Sky: Insure “Gamechanging Solutions”; Provide “Spellbinding Experiences”; Become a “Dream Merchant”; Strive to Be a “Lovemark;” Seek “Tattoo Brand” status.8. Relentlessly Pursue the “Big Two” Markets: Women, Boomers & Geezers. 9. Best Talent Wins! Women Rule! HR at the Head Table!

10. Educate for Creativity, Entrepreneurship & “Brand You” Independence.11. Demanded: Radical Technology Strategies! 12. Passion! Enthusiasm! Energy! Excitement! Relentlessness! 13. No Less Than EXCELLENCE. Ever.

X06/Excellence2006: The Bedrock Baker’s Dozen

1. A Bias For Action/A “Culture of Execution” = Job One! (Must be a Systematic Discipline.)

2. DECENTRALIZATION! ACCOUNTABILITY! (Tom’s “Top Two,” 1965-2005.)

3. Fail. Forward. Fast. (“Reward Excellent Failures, Punish Mediocre Successes.” “Most tries wins.”)

4. Velocity! Tempo! “Metabolic Management” Matters! (Hustle! Adapt! Win the “O.O.D.A. Loop” War—Confuse Your Competitors!)

5. INNOVATE … or Die. (“Game-changers” or Bust! Lead the Customer! Shout “NO” to Imitation!)

6. A Damn Good Product. A Damn Cool Product. (Pursue “Dramatic Difference.”

Design Rules!)

7. Ride the Value Added Curve to the Sky: Insure “Gamechanging Solutions”; Provide “Spellbinding Experiences”; Become a “Dream Merchant”; Strive to Be a “Lovemark;” Seek “Tattoo Brand” status.8. Relentlessly Pursue the “Big Two” Markets: Women, Boomers & Geezers. (WOMEN Buy Everything. BOOMERS & GEEZERS Have All the Money!)

9. Best Talent Wins! Women Rule! HR at the Head Table! (“Weird” Matters Most! A Workplace to Brag About! Educate for Creativity!)

10. Educate for Creativity, Entrepreneurship & “Brand You” Independence. (The schools have it all wrong!)

11. Demanded: Radical Technology Strategies! (“Incrementalism” Is for Wimps!)

12. Passion! Enthusiasm! Energy! Relentlessness! (Hard Is Soft! Soft Is Hard!) 13. No Less Than EXCELLENCE. Ever. (Excellence … the #1 Thing That Vaults Us Out of Bed in the Morning, and Matters in the Long run.)

EXCELLENCE.

ALWAYS.

“Why in the world did you go to Siberia?”

The Peters Principles: Enthusiasm.

Emotion. Excellence. Energy. Excitement. Service. Growth.

Creativity. Imagination. Vitality. Joy. Surprise. Independence. Spirit. Community. Limitless human potential. Diversity. Profit. Innovation. Design.

Quality. Entrepreneurialism. Wow.

Business* ** (*at its best): An emotional, vital, innovative, joyful,

creative, entrepreneurial endeavor that elicits

maximum concerted human potential in the

wholehearted service of others.***

**Excellence. Always.***Employees, Customers, Suppliers, Communities, Owners, Temporary partners

Business: The Ultimate Creative

Endeavor.

Business: The Ultimate Personal

Development-Growth

Experience.

Business: The Ultimate

Transcendent Service

Opportunity.

EXCELLENCE.

YOU & ME.

“In Tom’s world, it’s always better to try

a swan dive and deliver a colossal belly flop than to

step timidly off the board while holding

your nose.” —Fast Company

/October2003

“This is the true joy of Life, the being used for a purpose recognized by yourself as a mighty one … the being a

force of Nature instead of a feverish, selfish little clod of

ailments and grievances complaining

that the world will not devote itself

to making you happy.” —GB Shaw/Man and Superman

“My only goal is to have no goals. The goal, every time, is that film, that very moment.” —Bernardo Bertolucci

“Life is not a journey to the grave with the

intention of arriving safely in a pretty and well-preserved body—but

rather a skid in broadside, thoroughly used up, totally worn out, and

loudly proclaiming, ‘Wow, what

a ride!’ ” —anon.

EXCELLENCE.

TRANSCENDENCE.THRILLS.

Radically Thrilling Language!

“Radically Thrilling.”

—BMW Z4 (ad)

CTO**Chief Thrills Officer

Synonyms

PurityTranscendence

VirtueEleganceMajesty

Antonyms

Mediocrity

CTO**Chief Transcendence Officer

EXCELLENCE. WOW. NOW.

CWO**Chief WOW Officer

C!O*Chief ! Officer

“It’s always

showtime.”

—David D’Alessandro, Career Warfare

EXCELLENCE.LET.US.

MARCH.

“In classical times when Cicero had finished

speaking, the people said, ‘How well he spoke,’ but when Demosthenes had finished speaking,

they said, ‘Let us march.’” —Adlai Stevenson

“Never doubt that a small group of

committed people can change the

world. Indeed it is the only thing that ever has.” —Margaret Mead

EXCELLENCE.

You only find oil if you drill

wells.

IT’s always showtime.

let us march.

EXCELLE ALWAYS.