Best Management Practices Management Luke C

The current issue and full text archive of this journal is available at www.emeraldinsight.com/0262-1711.htm Best Best management practices management Luke C. Ng practices Frank G. Zarb School of Business, Hofstra University, Hempstead, New York, USA 93 Abstract Purpose – Management means “getting things done effectively through people”. This implies the importance of leadership and people skills in management practice to achieve optimal results. Great managers usually succeed for a number of reasons. They usually possess nine common management practices. This paper aims to identify these common denominators in their character and management practice that define them. Design/methodology/approach – Case examples are used to illustrate the application of those management practices. Successful managers from well-known industry giants such as IBM, Nestle’s, P&G, Apple, Loews’, GE and PepsiCo are profiled to demonstrate how their success can be traced back to those practices. Findings – The paper demonstrates that every manager can easily apply the nine management practices daily to achieve a successful outcome. While some of these traits appear to be personal habits, it is these simple management habits that influence subordinates to perform their best. Originality/value – Most good managers are trained, not born. The nine personal practices identified in this paper can be easily adopted on a daily basis. With consistent practice, the nine personal traits help train managers to become more effective leaders in driving optimal performance and motivating subordinates to “get things done effectively”. Keywords Management technique, Social skills, Motivation (psychology), Leadership, Management development, Best practice Paper type General review Introduction Management means getting things done effectively through people to achieve the desired results. This requires a combination of leadership, communication and people skills. A manager without any leadership skills is like a ship sailing on high seas without a compass and a gyroscope. The manager, in that case, is merely a bureaucrat pushing paper and administering the daily chores and directives of higher-ups – a glorified order-taker. In his groundbreaking 1977 Harvard Business Review article, “Managers and leaders, are they different?” professor Abraham Zaleznik illustrated the differences between managers and leaders based on four attitudinal qualities: attitudes toward goals; conceptions of work; relations with others; and sense of self (Zaleznik, 1977). However, the twenty-first century managers must possess all those attributes. They must proactively assume positive outlook, constantly shaping the competitive landscape, and steering the firm to their desired course. Rather than accepting status quo, they always examine alternatives and develop new approaches to problem Journal of Management Development Vol. 30 No. 1, 2011 solving. Moreover, they emotionally connect with colleagues and subordinates by pp. 93-105 establishing open communication links, thereby inviting new ideas and fresh q Emerald Group Publishing Limited 0262-1711 approaches to getting things done. They usually avoid getting bogged down by the DOI 10.1108/02621711111098398 JMD bureaucratic process. Instead, they find ways to “bypass” or change the process to 30,1 steer clear of bottlenecks. In the auto-biography, War as I Know It, General George Patton and author Rick Atkinson described how the legendary second world war commander managed the allies invasion of Sicily and the subsequent campaign to rescue encircled US paratroopers in Bastogne. He demonstrated how a military leader managed the 94 campaign skillfully by “re-shaping” the “competitive landscape” (changing the process) to achieve optimal results. However, all these successful actions were made possible in large part because of Patton’s sense of self – a special confidence of “destiny” in the organization (Atkinson and Patton, 1947). Likewise, modern day managers must assume and exert the same self-assurance to achieve the targeted outcome by leading the team with confidence. Great managers usually exhibit nine common management practices. In this paper, examples are drawn from companies such as IBM, Nestle’s, G.E., Loews’, P&G, PepsiCo and Apple, to illustrate the actual application of these practices. Visionary big picture orientation A good manager must have the capacity to see the “big picture” – the ability to see the forest rather than looking at individual trees. This unique attribute is usually the hallmark of a great manager. It requires the manager to think strategically, like a good chess player, planning several steps ahead. Equally important, it requires the manager to assess the implication of each move, especially their long-term impact, not merely short-term results. Even though Lou Gerstner had no background in technology, he was recruited out of Nabisco (a food conglomerate) to be the CEO of IBM. By his own admission, Gerstner never even used a PC (personal computer) until the first day of his arrival at the Big Blue (Gerstner, 2002). However, he was able to strategically see the “forest”. He saw that the world was changing due to the “tech revolution” while IBM was still resting on its laurels. The company was blindly stuck to the mainframe strategy – trying to perfect the humongous “IBM big box” while the rest of the world was going PC and work stations. This emerging trend would essentially make IBM’s flagship irrelevant. Despite being an outsider, Gerstner was able to change the strategic focus of IBM by liberating it from the traditional “marketing myopia” as described by Ted Levitt’s revolutionary thesis (Levitt, 1960). Today, Big Blue is thriving again simply because Gerstner was able to “convert” the stodgy old giant into a nimble technology firm. About 60 percent of IBM’s current revenue comes from software/service/consulting. Only 1/3 of its business remains hardware related. Without Gerstner’s visionary big picture strategic shift, IBM might have disappeared into the oblivion, like Wang Computer, E-Toy and Gateway Computer. In a different way, A.G. Lafley, the current Chairman and CEO of Procter & Gamble and Ram Charan described in “The Game Changer” how he turned around the embattled consumer product giant after unexpectedly yanked into the CEO suite (Lafley and Charan, 2008). Unlike Gerstner, A.G. Lafley is a life-long P&G veteran with over 30-years of brand management experience. As an insider, however, he saw the need to change the status quo – a unique P&G mentality that was prevalent for many decades. Essentially, Lafley. managed the monumental change perfectly by looking at the “forest” with a different strategic vision. He began fostering a new mindset for all P&Gers by first Best changing the attitudes of the company. management Contrary to P&G of the past, Lafley encouraged that innovations must be promoted from both inside the company (traditionally) and outside sources as well. This led to practices the unprecedented sourcing of new ideas from the outside such as the battery-powered toothbrush. From a marketing perspective, this was a brilliant move. It essentially transformed the old standard toothbrush from a commodity that everyone needs 95 (retailing between 75c to $1 each) into a $6 mechanical brush that many consumers want! This moved the consumer up-market and raised the toothbrush revenue significantly. Equally important, the ergonomically designed brush is powered by batteries (that P&G happens to distribute – Duracell). It was followed by other mammoth acquisitions such as Pantene and Wella Hair Care, only to be surpassed by the epic $56 billion purchase of Gillette. Essentially, A.G. Lafley transformed P&G from a “soap” company (Ivory & Tide) into a consumer product giant (personal care and beauty care, family care, health care, and household care). Meanwhile, Lafley initiated game-changing policies such as inviting ideas for innovations from suppliers and even P&G alumni from around the world. The idea is to tap into the vast network of former employees who were raided by other firms regularly. Many of the P&G alumni have become very successful in other companies. Some notable examples are Meg Whitman, who became Chairman of Ebay; Steve Ballmer, the current CEO of Microsoft; Steve Case, who founded AOL and Jeff Immelt, current CEO and Chairman of GE. They all had their humble beginning at P&G! With these untraditional strategic shifts, Lafley has steered P&G on an enormous growth path analogous to GE’s during Jack Welch’s era. In retrospect, none of these could have materialized without Lafley’s visionary strategic change. Equally remarkable was that A.G. managed the disruptive change process perfectly by rallying the troops to support him enthusiastically – a seismic shift of entrenched attitudes that his predecessors were unable to achieve. Other examples of visionary managers are Steven Reinemund and Indra Nooyi of PepsiCo as well as Steve Jobs of Apple. Both Steve Reinemund (former Chairman and CEO) and Indra Nooyi, former CFO who succeeded Reinemund as CEO in 2006, are credited for their successful transformation of PepsiCo. They accelerated the strategic shift by expanding the Frito Lay division (snack) and restaurants (KFC, Taco Bell and Pizza Hut, etc., later became Yum Brands). Company resources were devoted to non-carbonated beverage categories with the $14 billion purchase of Quaker Oats followed by Tropicana Orange Juice, Naked Juice, Izzi and Aquafina Water (Business Week, 2002). These strategic moves were significant because the world was changing – consumers were shying away from carbonated drinks (soda) into alternative beverage, perceived to be healthier. Such acquisitions were well timed to take advantage of the consumer taste shift. Meanwhile, Pepsi’s food business expands into emerging markets by leaps and bounds. This coincides with the explosive economic growth and the rise of the middle class in China and India. Consequently, KFC and Pizza Hut have become the fastest growing restaurant chains in those countries while Pepsi, the soda, is simply riding the coattail of the food business, expanding one restaurant at a time.

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