Tom Peters

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Tom Peters Seminar2002 We Are In A Brawl
With No Rules!BNP Paribas/05.30.2002
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All Slides Available at tompeters.comNote
Lavender text in this file is a link.
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CONTEXT
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Confusion Reigns.
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There will be more confusion in the business
world in the next decade than in any decade in
history. And the current pace of change will only
accelerate.Steve Case
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Way to Go, Jerry et al. 2002 write downs from
recent acquisitions
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1,000,000,000,0001 trillion (Source
Harpers Index 04.2002)
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When asked to name just one big merger that had
lived up to expectations, Leon Cooperman, former
cochairman of Goldman Sachs Investment Policy
Committee, answered Im sure there are success
stories out there, but at this moment I draw a
blank.Mark Sirower, The Synergy Trap
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Business On The Ropes (5T) Dot-Com Mania
Enron Andersen Merrill Lynch AOL Time
Warner Bernie E.
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Wall Street Credibility 0
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The Destruction Imperative.
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ForgetgtLearnThe problem is never how to get
new, innovative thoughts into your mind, but how
to get the old ones out.Dee Hock
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Forbes100 from 1917 to 1987 39 members of the
Class of 17 were alive in 87 18 in 87 F100
18 F100 survivors underperformed the market by
20 just 2 (2), GE Kodak, outperformed the
market 1917 to 1987.SP 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
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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 Innovators Dilemma
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W.I.W.? 20 of 26(7 of top 10)
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PG Declining domestic sales in 20 of 26
categories 7 of top 10 categories. (The
billion-dollar problem.)Source Advertising
Age 01.21.2002/BofA Securities
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Primary Obstacles to Marketing-driven
Change1. Fear of cannibalism.2. Excessive
cult of the consumer/ customer driven/
slavery to demographics, market research and
focus groups.3.Creating sustainable
advantage. Source
John-Marie Dru, Disruption
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Chivalry is dead. The new code of conduct is an
active strategy of disrupting the status quo to
create an unsustainable series of competitive
advantages. This is not an age of defensive
castles, moats and armor. It is rather an age of
cunning, speed and surprise. It may be hard for
some to hang up the chain mail of sustainable
advantage after so many battles. But
hypercompetition, a state in which sustainable
advantages are no longer possible, is now the
only level of competition.Rich DAveni,
Hypercompetition Managing the Dynamics of
Strategic Maneuvering
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They consumer goods company have acquired a
bunch of products, which is what everyone is
doing. But whats the point, the message, the
story line, the Big Idea that makes it all hang
together?Exec, major consumer goods company
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Acquisitions are about buying market share. Our
challenge is to create markets. There is a big
difference. Peter Job, CEO, Reuters
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Active mutators in placid times tend to die off.
They are selected against. Reluctant mutators in
quickly changing times are also selected
against.Carl Sagan Ann Druyan, Shadows of
Forgotten Ancestors
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The Gales of Creative Destruction29M -44M
73M4M 4M - 0M
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Jim Tom. Joined at the hip. Not.
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Built to Last v. Built to FlipThe problem with
Built to Last is that its a romantic notion.
Large companies are incapable of ongoing
innovation, of ongoing flexibility.Increasingl
y, successful businesses will be ephemeral. They
will be built to yield something of value and
once that value has been exhausted, they will
vanish.Fast Company (03-00)
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But what if former head of strategic planner 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
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The difficulties arise from the inherent
conflict between the need to control existing
operations and the need to create the kind of
environment that will permit new ideas to
flourishand old ones to die a timely death. We
believe that most corporations will find it
impossible to match or outperform the market
without abandoning the assumption of continuity.
The current apocalypsethe transition from a
state of continuity to state of discontinuityhas
the same suddenness as the trauma that beset
civilization in 1000 A.D. Richard Foster
Sarah Kaplan, Creative Destruction (The
McKinsey Quarterly)
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IS/IT/Web On the Bus or Off the Bus.
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E.g. Jeff Immelt 75 of admin, back room,
finance digitalized in 3 years.Source BW
(01.28.02)
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IBMs Project eLiza! Self-bootstrapping/
Artilects
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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
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100 square feet
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Autobytel 400. WalMart 13.Source
BW(05.13.2002)
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Ebusiness is about rebuilding the organization
from the ground up. Most companies today are not
built to exploit the Internet. Their business
processes, their approvals, their hierarchies,
the number of people they employ all of that is
wrong for running an ebusiness.Ray Lane,
Kleiner Perkins
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RESPONSE
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The Heart of the Value Added Revolution The
Solutions Imperative.
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Base Case The Sameness Trap
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While everything may be better, it is also
increasingly the same.Paul Goldberger on
retail, The Sameness of Things, The New York
Times
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We make over three new product announcements a
day. Can you remember them? Our customers
cant!Carly Fiorina
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The surplus society has a surplus of similar
companies, employing similar people, with similar
educational backgrounds, working in similar jobs,
coming up with similar ideas, producing similar
things, with similar prices and similar
quality.Kjell Nordström and Jonas
Ridderstråle, Funky Business
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Customers will try low cost providers
because the Majors have not given them any clear
reason not to.Leading Insurance Industry
Analyst
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SWA gt American Continental Delta Northwest
United USAirways.Source Boston Globe
(12.22.2001)
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Getting Beyond Lip Service!No longer are we
only an insurance provider. Today, we also
offer our customers the products and services
that help them achieve their dreams, whether its
financial security, buying a car, paying for home
repairs, or even taking a dream vacation.Martin
Feinstein, CEO, Farmers Group
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The Big Day!
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09.11.2000 HP bids 18,000,000,000for
PricewaterhouseCoopersconsulting business!
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These days, building the best server isnt
enough. Thats the price of entry.Ann
Livermore, Hewlett-Packard
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Gerstners IBM Systems Integrator of choice.
Global Services 35B. Pledge/99 Business
Partner Charter. 72 strategic partners, aim for
200. Drop many in-house programs/products.
(BW/12.01).
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We want to be the air traffic controllers of
electrons.Bob Nardelli, GE Power Systems
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Was Bunch of Guys Who Make Circuit Breakers
Division. Is GE Industrial Systems.
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UPS wants to take over the sweet spot in the
endless loop of goods, information and capital
that all the packages it moves
represent.ecompany.com/06.01 (E.g., UPS
Logistics manages the logistics of 4.5M Ford
vehicles, from 21 mfg. sites to 6,000 NA dealers)
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Omnicom 57 (of 6B) from marketing services
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The Solutions25.
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1. Its the (OUR!) organization,
stupid!2. Friction free! 3. No STOVEPIPES!4.
Stovepiping is a F.O.Firing Offense.5. ALL on
the web! (ALL ALL.)6. Open access!6. Project
Managers rule! (E.g. Control the purse
strings and evals.)7. VALUE-ADDED RULES!
(Services Rule.) (Experiences Rule.) (Brand
Rules.)8. SOLUTIONS RULE! (We sell SOLUTIONS.
Period. We sell PRODUCTIVITY
PROFITABILITY. Period.)9. Solutions Our
culture. 10. Partner with B.I.C.
(Best-In-Class). Period.
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12. All functions contribute equallyIS, HR,
Finance, Purchasing, Engineering,
Logistics, Sales, Etc.13. Project Management can
come from any function.14. WE ARE ALL IN SALES.
PERIOD.15. We all invest in wiring the
customer organization.16. WE ALL LIVE THE
BRAND. (Brand Solutions. That MAKE
MONEY FOR OUR CUSTOMER- PARTNER.)17. We
use the word PARTNER until we all want to
barf!18. We NEVER BLAME other parts of our
organization for screw-ups.19. WE AIM TO
REINVENT THIS INDUSTRY!20. We hate the word-idea
COMMODITY.
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21. We believe in High tech, High touch.22. We
are DREAMERS.23. We deliver . (PROFITS.)
(CUSTOMER SUCCESS.)24. If we play the SOLUTIONS
GAME brilliantly, no one can touch us!25.
Our TEAM needs 100 I.C.s (Imaginative
Contributors). This is the ULTIMATE All Hands
affair!
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In an era when terrorists use satellite phones
and encrypted email, US gatekeepers stand armed
against them with pencils and paperwork, and
archaic computer systems that dont talk to each
other.Boston Globe (09.30.2001)
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Once devised in Riyadh, the tasking order took
hours to get to the Navys six aircraft
carriersbecause the Navy had failed years
earlier to procure the proper communications gear
that would have connected the Navy with its Air
Force counterparts. To compensate for the lack
of communications capability, the Navy was forced
to fly a daily cargo mission from the Persian
Gulf and Red Sea to Riyadh in order to pick up a
computer printout of the air mission tasking
order, then fly back to the carriers, run
photocopy machines at full tilt, and distribute
the documents to the air wing squadrons that were
planning the next strike. Bill Owens, Lifting
the Fog of War
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Innovation Speeds New Basics1. XFTs
are the culture.2. Project-centric. 3. Open
talent market.4. Cause-based projects. 5.
Ubiquitous open systems ISat home
throughout supply chain. Web based.6.
F-L-A-T.Innovation, Speed, CRM, Experience/
Solution demand this
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PSF Unbound Its the EXPERIENCE.
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Experiences are as distinct from services as
services are from goods.Joseph Pine James
Gilmore, The Experience Economy Work Is Theatre
Every Business a Stage
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Experience Rebel Lifestyle!What we sell is
the ability for a 43-year-old accountant to dress
in black leather, ride through small towns and
have people be afraid of him.Harley exec,
quoted in Results-Based Leadership
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Club Med is more than just a resort its a
means of rediscovering oneself, of inventing an
entirely new me. Source Jean-Marie Dru,
Disruption
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Guinness as a brand is all about community. Its
about bringing people together and sharing
stories.Ralph Ardill, Imagination, in re
Guinness Storehouse
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The Experience LadderExperiences
ServicesGoods Raw Materials
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1940 Cake from flour, sugar (raw materials
economy) 1.00 1955 Cake from Cake
mix (goods economy) 2.00 1970
Bakery-made cake (service economy) 10.001990
Party _at_ Chuck E. Cheese (experience economy)
100.00
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Message Experience is the Last 80P.S.
Experience applies to all work!
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1940 Cake from flour, sugar (raw materials
economy) 1.00 1955 Cake from Cake
mix (goods economy) 2.00 1970
Bakery-made cake (service economy) 10.001990
Party _at_ Chuck E. Cheese (experience economy)
100.00
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Bob Lutz I see us as being in the art business.
Art, entertainment and mobile sculpture, which,
coincidentally, also happens to provide
transportation. Source NYT 10.19.01
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Its All About EXPERIENCES Trapper to
Wildlife Damage-control ProfessionalTrapper
lt20 per beaver pelt.WDCP 150/problem
beaver 750-1,000 for flood-control piping
so that beavers can stay.Source
WSJ/05.21.2002
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It all adds up to THE BRAND.
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The Heart of Branding
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WHO ARE WE?
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We are in the twilight of a society based on
data. As information and intelligence become the
domain of computers, society will place more
value on the one human ability that cannot be
automated emotion. Imagination, myth, ritualthe
language of emotionwill affect everything from
our purchasing decisions to how we work with
others. Companies will thrive on the basis of
their stories and myths. Companies will need to
understand that their products are less important
than their stories.Rolf Jensen, Copenhagen
Institute for Future Studies
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WHATS OUR STORY?
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Most companies tend to equate branding with the
companys marketing. Design a new marketing
campaign and, voilà, youre on course. They are
wrong. The task is much bigger. It is about
fulfilling our potential not about a new logo,
no matter how clever. WHAT IS MY MISSION IN
LIFE? WHAT DO I WANT TO CONVEY TO PEOPLE? HOW
DO I MAKE SURE THAT WHAT I HAVE TO OFFER THE
WORLD IS ACTUALLY UNIQUE? The brand has to give
of itself, the company has to give of itself, the
management has to give of itself. To put it
bluntly, it is a matter of whether or not you
want to be UNIQUE NOW.Jesper Kunde, A
Unique Moment
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Apple opposes, IBM solves, Nike exhorts, Virgin
enlightens, Sony dreams, Benetton protests.
Brands are not nouns but verbs.Source
Jean-Marie Dru, Disruption
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EXACTLY HOW ARE WE DRAMATICALLY DIFFERENT?
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1st Law Mktg Physics OVERT BENEFIT (Focus 1 or
2 gt 3 or 4/One Great Thing. Source 1
Personal Passion)2ND Law REAL REASON TO
BELIEVE (Stand Deliver!)3RD Law DRAMATIC
DIFFERENCE (Execs Dont Get It.)Source Jump
Start Your Business Brain, Doug Hall
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You do not merely want to be the best of the
best. You want to be considered the only ones who
do what you do.Jerry Garcia
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A great company is defined by the fact that it
is not compared to its peers.Phil Purcell,
Morgan Stanley
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EXACTLY HOW DO I PASSIONATELY CONVEY THAT
DRAMATIC DIFFERENCE TO THE CLIENT ?
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THE WORK
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Redefining the Work Itself I The WOW Project.
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Reward excellent failures. Punish mediocre
successes.Phil Daniels, Sydney exec
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The greatest dangerfor most of usis not that
our aim istoo highand we miss it,but that it
istoo lowand we reach it.Michelangelo
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THE TALENT
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Brand Talent.Duh.
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The leaders of Great Groups love talent and
know where to find it. They revel in the talent
of others.Warren Bennis Patricia Ward
Biederman, Organizing Genius
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Model 25/8/53 Sports Franchise GM
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From 1, 2 or youre out JW to Best
Talent in each industry segment to build best
proprietary intangibles EMSource Ed
Michaels, War for Talent
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Message Some people are better than other
people. Some people are a helluva lot better than
other people.
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AS LEADERS, WOMEN RULE New Studies find that
female managers outshine their male counterparts
in almost every measureTitle, Special Report,
Business Week, 11.20.00
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TAKE THIS QUICK QUIZ Who manages more things
at once? Who puts more effort into their
appearance? Who usually takes care of the
details? Who finds it easier to meet new
people? Who asks more questions in a
conversation? Who is a better listener? Who
has more interest in communication skills? Who
is more inclined to get involved? Who
encourages harmony and agreement? Who has
better intuition? Who works with a longer to
do list? Who enjoys a recap to the days
events? Who is better at keeping in touch
with others?Source Selling Is a Womans Game
15 Powerful Reasons Why Women Can Outsell Men,
Nicki Joy Susan Kane-Benson
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Investors are looking more and more for a
relationship with their financial advisers. They
want someone they can trust, someone who listens.
In my experience, in general, women may be better
at these relationship-building skills than are
men.Hardwick Simmons, CEO, Prudential
Securities
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The Cracked Ones Let in the LightOur business
needs a massive transfusion of talent, and
talent, I believe, is most likely to be found
among non-conformists, dissenters and
rebels.David Ogilvy
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Are there enough weird people in the lab these
days?V. Chmn., pharmaceutical house, to a lab
director (06.01)
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The A students work for the B students. The C
students run the business. The D students
dedicate the buildings. Assertion to Kinkos
founder Paul Orfalea from his Mom
(Fortune/05.13.02)
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BOTTOM LINE LEADING IN TOTALLY SCREWED- UP TIMES
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The Basic Premise.
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1. Leadership Is a Mutual Discovery Process.
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I dont know.
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2. Leaders Try Not to Screw Things Up
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Ninety percent of what we call management
consists of making it difficult for people to get
things done. P.D.
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The Leadership Types.
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3. Great Leaders on Snorting Steeds Are Important
but Great Talent Developers (Type I Leadership)
are the Bedrock of Organizations that Perform
Over the Long Haul.
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Whoops Jack didnt have a vision!
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4. But Then Again, There Are Times When This
Cult of Personality (Type II Leadership) Stuff
Actually Works!
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A leader is a dealer in hope.Napoleon
(TPs writing room pics)
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5. The Leader Is Rarely/Never the Best Performer.
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33 Division Titles. 26 League Pennants. 14 World
Series Earl Weaver0. Tom Kelly0. Jim
Leyland0. Walter Alston1AB. Tony LaRussa132
games, 6 seasons. Tommy LasordaP, 26 games.
Sparky Anderson1 season.
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The Leadership Dance.
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6. Leaders SHOW UP!
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Rudy!
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7. Leaders LOVE the MESS!
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Im not comfortable unless Im
uncomfortable.Jay Chiat
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8. Leaders DO!
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The Kotler Doctrine1965-1980
R.A.F.(Ready.Aim.Fire.)1980-1995
R.F.A.(Ready.Fire!Aim.)1995-????
F.F.F.(Fire!Fire!Fire!)
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9. Leaders Re-do.
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If Microsoft is good at anything, its avoiding
the trap of worrying about criticism. Microsoft
fails constantly. Theyre eviscerated in public
for lousy products. Yet they persist, through
version after version, until they get something
good enough. Then they leverage the power theyve
gained in other markets to enforce their
standard.Seth Godin, Zooming
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If it works, its obsolete. Marshall McLuhan
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10. BUT Leaders Know When to Wait.
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Tex Schramm The too hard box!
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11. Leaders KNOW They Can Make a Difference!
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It is no use saying We are doing our best. You
have got to succeed in doing what is necessary.
WSC
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12. Leaders FOCUS!
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To Dont List
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Danger S.I.O. (Strategic Initiative Overload)
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JackWorld/1_at_T (1) Neutron Jack. (Banish
bureaucracy.) (2) 1, 2 or out Jack. (Lead or
leave.) (3) Workout Jack. (Empowerment, GE
style.) (4) 6-Sigma Jack. (5) Internet Jack.
(Throughout) TALENT JACK!
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If It Aint Broke Break It.
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13. Leaders FORGET!/Leaders DESTROY!
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Cortez!
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Leaders dump the ones who brung em Nokia, HP,
3M, PerkinElmer, Corning, etc.
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14. BUT Leaders Have to Deliver, So They Worry
About Throwing the Baby Out with the Bathwater.

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Damned If You Do, Damned If You Dont, Just
Plain Damned.Subtitle in the chapter, Own Up
to the Great Paradox Success Is the Product of
Deep Grooves/ Deep Grooves Destroy Adaptivity,
Liberation Management (1992)
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Organize for performance customer
satisfaction.Disorganize for renewal
innovation.
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15. Leaders Make Lotsa Mistakes and MAKE NO
BONES ABOUT IT!
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Sams Secret 1!
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Talent.
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16. When It Comes to TALENT Leaders Always
Swing for the Fences!
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From 1, 2 or youre out JW to Best
Talent in each industry segment to build best
proprietary intangibles EMSource Ed
Michaels, War for Talent (05.17.00)
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Passion.
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17. Leaders Out Their PASSION!
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G.H. Create a cause, not a business.
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BZ I am a Dispenser of Enthusiasm!
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The Job of Leading.
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18. Leadership Is a Performance.
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It is necessary for the President to be the
nations No. 1 actor.FDR
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19. Leaders Have a GREAT STORY!
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A key perhaps the key to leadership is
the effective communication of a story.Howard
Gardner Leading Minds An Anatomy of Leadership
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Leaders dont just make products and make
decisions. Leaders make meaning. John Seeley
Brown
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Introspection.
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20. Leaders Enjoy Leading.
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Warren, I know you want to be president. But
do you want to do president?
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21. Leaders Take Breaks.
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Zombie!Zombie!Zombie!Zombie!
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The End Game.
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22. Leaders ???
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Leadership is the PROCESS of ENGAGING PEOPLE in
CREATING a LEGACY of EXCELLENCE.
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Hire smart go bonkers have grace make
mistakes love technology start all over
again.
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LEADERS NEED TO BE THE ROCK OF GIBRALTAR ON
ROLLER BLADES
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Thank You!