Needed small business skills

“Running a small business requires many skills. However, to do this successfully you need to organize yourself first. Avoid procrastination - read the following and take action.

1. Successful Small Business Owners Look After Themselves First

Exercise regularly, eat healthily and be around positive people. Feed your mind by attending personal development courses. Read self-help and motivational books, listen to tapes. Stress management levels will be much more effective when you look after yourself.

Do the right thing by yourself and you’ll have heaps of energy, be motivated, have more balance in your life which in turn will help you be more productive and successful.

2. Successful Small Business Owners Clean out the Clutter Regularly

You will save yourself heaps of time, energy and money if you clear out your work and home environment…paperwork, books, old equipment etc. You’ll be able to find things, save money because you won’t have to buy what you already have hidden somewhere, plus you’ll be less stressed. Organize your office and your small business premises regularly…keep the clutter out. Eliminating clutter will help you to avoid procrastination. It’s too easy to avoid getting things done if you are overwhelmed with clutter.

3. Successful Small Business Owners Use the Right Tools

It’s no good having the latest whiz-bang computer when the desk that you sit at is too small to accommodate it, or the chair has poor back support, or the lighting is dull causing you eyestrain and fatigue. All these factors heavily influence how you work. Invest in a decent desk, purchase a desk lamp or change the light globes.

Don’t avoid the warning signs your body gives you. Take action now before you have eye, back or neck problems.

4. Successful Small Business Owners Use a Diary or Digital Organizer

With so much to organize in your small business, you need to record your appointments and things to do and goals somewhere. Preferably in a paper diary or digital organiser that you can take everywhere. This is the most effective way to get things done, plan your work and your life. Balance is extremely important. Top achievers are great at time management (even if they have to pay someone else to organize them).

5. Successful Small Business Owners Learn to say “No”

To dramatically improve your productivity and do more of the things you want, you have to be firm with others and let them know if you cannot, will not or are unavailable to fulfil their requests. If you constantly say “yes” to everyone else’s requests you will never have the time to do what you really want to.

Book yourself into a self-assertiveness course to learn these skills if you feel you need to.

6. Successful Small Business Owners Do What They Do Best and Delegate the Rest

See what tasks you can delegate tasks which would suit someone else’s talents. Many small business owners are spending heaps of time on mundane secretarial tasks which would take a person who is trained in that area a quarter of the time to undertake. Stress management is an important part of running your small business. Reduce the stress by delegating or outsourcing wherever you can.

Use a bookkeeper, personal assistant or virtual assistant. Always ask yourself, who else can I get to do this? Use your time management to focus on what you do best.

7. Successful Small Business Owners Only Have Meetings if Necessary

Make sure the meetings you organize in your small business are relevant and run effectively. Avoid procrastination - always make sure there is an outcome and all actions are followed through.

The Final Word By following these simple yet very effective time management tips for small business owners you will have more control over your work and your life. You’ll have more balance, experience less stress and be more proactive.

Avoid procrastination…take action today!”

Evan Carmichael
YoungEntrepreneur.com Blog Manager

Open Source Analytics ....

piwik is an open source (GPL license) web analytics software. It gives interesting reports on your website visitors, your popular pages, the search engines keywords they used, the language they speak… and so much more.

piwik aims to be an open source alternative to Google Analytics.

Behavioral Based Target Ads over NeT

Behavioral Targeting and Contextual Advertising

Is online advertising undergoing a “rebirth”? Some might argue it is, first spurred on by paid search advertising then by contextual and adware placements. Now there is another “new” game in town, if the buzz-o-meter is any indication. While not altogether new, behavioral advertising is getting more play than ever, perhaps because it’s now being married with every marketer’s favorite word: targeting.

Is behavioral targeting really all that? Let’s take a closer look.

The Process

One basic premise in marketing is that to more effectively sell your product or service, you should understand how your customers’ minds work. What do they like to see? What do they want to hear? What do they like to do? And can you determine these things with as little time and money as possible? Now there technologies that *can* easily establish these answers quickly and effectively to give you an at-a-glance picture of behavioral targeting to these consumers.

Behavioral targeting technologies work by anonymously monitoring and tracking the content read and sites visted by a designated unique user or IP as that user surfs the Internet. This is done by serving tracking codes, which are implemented as cookies, on a user’s computer as s/he is served ads from various online advertising networks. Sites visited, content viewed, and length of visit are then all databased and analyzed to predict an online behavioral pattern for such a user, thereby classifying that user by his/her online demographic. Behavioral ad networks then serve targeted advertising related to that user’s behavioral classification, regardless of where s/he then visit.

For example, if a computer user frequents sites such as SlashDot, Maxim Online, Wired, and Men’s Health, behavioral targeting would classify such a user as a male, with interest in technology. When behavioral targeting advertising companies such as Tacoda or 24/7 serves ads on such sites, their ads place behavior targeting cookies on the user’s computer. Then, if that same user later visits a site with ads served by these networks, an advertisement might be served for shaving cream or even a tech job site (especially if the user is reading the news online during regular work hours). If that user becomes target to a behavioral advertising, he may be served a series of the same ad campaign across various sites, all without his awareness of the targeting going on around him.

Basic Essence of Leadership

You don't have to be in a position of authority to be a leader. Conversely, just because you have authority doesn't mean that people will follow you. You must be a leader to get others to follow you.

There are many books on leadership. They can have lots of great examples and in-depth explanations, but sometimes you just need something simple to help you focus on the essentials. This article intends to do just that. These are the habits that will help you and your team achieve great things if you focus on them.

1. Goals. Make it simple and easy for your team to understand the mission and to understand their part in achieving it.

• Concise Goals. Keep them simple and easy to understand.
• Focus your team on as few goals as possible.
• Communicate the team's goals Often and through Various Means (team meetings, individual meetings, emails, posters, slogans). And then do it some more.
• Track progress on goals.
• Involve team players in tracking the goals so that they own the results.

2. Motivating People. What you reward gets done. It's that simple.

• Instruct team players to do the tasks that are most critical for reaching the team's goals. Make sure the rewards are meaningful to people. Understand each player and what they want from their job and in life. That's how you'll know how to reward them.
• Praise, Thank, and Recognize big and small contributions by individuals. Do this often and then do it some more.
• Set High Expectations. People will live UP to or DOWN to the expectations you set. Set them high and you're saying, "I believe in your ability to do great things!"
• Empower people by delegating responsibility.
• Celebrate team accomplishments often.
• Encourage Fun. Make the work place a fun place to be. Yes, work needs to get done but short fun breaks can make all the difference in the culture of your team.
• Pride. Foster a sense of pride in your team. As a team you could establish a mascot, create a team chant, and have a meeting that is focused solely on each individual's strengths and the team's overall strengths.
  

3. Walk Your Talk. You need to practice what you preach. This is how you establish trust and credibility.

• Model the Way by participating in the team's tasks as much as your position allows.
• Be Honest. Deliver on your promises. Actions speak louder than words.
• Challenge Yourself. Do your best (and then some) just like you ask your team to do their best.
• Speak Up. Just like your team members sometimes need to let you know what they've done in order for you to be able to recognize and praise them. They, in turn, need to know what you've been working on and what you've accomplished. So find ways to communicate this, modeling this key behavior.
• Stay Sharp. You need to be competent for others to follow you. If you're not improving, you're falling behind. Always be learning and keep on top of the latest skills, technology, and knowledge in your field.
  

4. Inspire through a combination of

• Unwavering Positive Future Vision
• Commitment to Improve things along the way that will make that positive vision a reality.
• Ability to Bootstrap as necessary when resources are tight.

5. Process Power. Good process is like having a high performance machine. Sloppy process makes things fall apart. So be sure to establish these key habits with your team.

• Establish Routines. Do this for the team and also work with each individual to come up with their own high productivity routines. These are routines that dictate what work is done when.
• Establish Processes for all the tasks that are done repeatedly. It takes time to set up at first, but after that it will pay off in saved time and less errors. Processes describe how work is done and might involve systems for doing the work.
• Task Assignment. As much as possible, assign tasks according to the strengths of each teammate.

6. Change. Embrace change by seeking it out. This will tread a path for your teammates to follow.

• Change Routines Quarterly. Look for better ways to achieve the team's goals.
• Take Risks. Don't be afraid of failure. No one ever reaches great heights without a few failures.
• Learn. Learn as a team from failures. "How can we improve it the next time?"
• Encourage team members to take smart risks too by making it safe to fail. Focus on learning from past experiences and building upon them to find better solutions.

7. Advocacy. Support your team and they'll support you.

• Promote your team members. Make sure others outside your team know about the individual team members' successes. You want your team members to excel and even graduate away from your team possibly. Don't worry. If your team is great there will be plenty of others who will want to join! This natural turnover of team members is like the renewal of cells in your body. It is necessary and healthy.
• Promote your team. It's your job to market the great accomplishments of your team in order to get the rewards, recognition, and resources that your team deserves.
• Fight for the most important resources and changes that will benefit your team and the organization overall. Remember to pick your battles wisely.

Strategy - About ......

Abstract

The concept of strategy has been borrowed from the military and adapted for use in business. A review of what noted writers about business strategy have to say suggests that adopting the concept was easy because the adaptation required has been modest. In business, as in the military, strategy bridges the gap between policy and tactics. Together, strategy and tactics bridge the gap between ends and means. This paper reviews various definitions of strategy for the purpose of clarifying the concept and placing it in context. The author's aim is to make the concepts of policy, strategy, tactics, ends, and means more useful to those who concern themselves with these matters..

Some Language Basics

Strategy is a term that comes from the Greek strategia, meaning "generalship." In the military, strategy often refers to maneuvering troops into position before the enemy is actually engaged. In this sense, strategy refers to the deployment of troops. Once the enemy has been engaged, attention shifts to tactics. Here, the employment of troops is central. Substitute "resources" for troops and the transfer of the concept to the business world begins to take form.

Strategy also refers to the means by which policy is effected, accounting for Clauswitz’ famous statement that war is the continuation of political relations via other means. Given the centuries-old military origins of strategy, it seems sensible to begin our examination of strategy with the military view. For that, there is no better source than B. H. Liddell Hart.

Strategy According to B. H. Liddell Hart

In his book, Strategy [1], Liddell Hart examines wars and battles from the time of the ancient Greeks through World War II. He concludes that Clausewitz’ definition of strategy as "the art of the employment of battles as a means to gain the object of war" is seriously flawed in that this view of strategy intrudes upon policy and makes battle the only means of achieving strategic ends. Liddell Hart observes that Clausewitz later acknowledged these flaws and then points to what he views as a wiser definition of strategy set forth by Moltke: "the practical adaptation of the means placed at a general’s disposal to the attainment of the object in view." In Moltke's formulation, military strategy is clearly a means to political ends.

Concluding his review of wars, policy, strategy and tactics, Liddell Hart arrives at this short definition of strategy: "the art of distributing and applying military means to fulfil the ends of policy." Deleting the word "military" from Liddell Hart’s definition makes it easy to export the concept of strategy to the business world. That brings us to one of the people considered by many to be the father of strategic planning in the business world: George Steiner.

Strategy According to George Steiner

George Steiner, a professor of management and one of the founders of The California Management Review, is generally considered a key figure in the origins and development of strategic planning. His book, Strategic Planning [2], is close to being a bible on the subject. Yet, Steiner does not bother to define strategy except in the notes at the end of his book. There, he notes that strategy entered the management literature as a way of referring to what one did to counter a competitor’s actual or predicted moves. Steiner also points out in his notes that there is very little agreement as to the meaning of strategy in the business world. Some of the definitions in use to which Steiner pointed include the following:

• Strategy is that which top management does that is of great importance to the organization.
• Strategy refers to basic directional decisions, that is, to purposes and missions.
• Strategy consists of the important actions necessary to realize these directions.
• Strategy answers the question: What should the organization be doing?
• Strategy answers the question: What are the ends we seek and how should we achieve them?

Steiner was writing in 1979, at roughly the mid-point of the rise of strategic planning. Perhaps the confusion surrounding strategy contributed to the demise of strategic planning in the late 1980s. The rise and subsequent fall of strategic planning brings us to Henry Mintzberg.

Strategy According to Henry Mintzberg

Henry Mintzberg, in his 1994 book, The Rise and Fall of Strategic Planning [3], points out that people use "strategy" in several different ways, the most common being these four:

1. Strategy is a plan, a "how," a means of getting from here to there.
2. Strategy is a pattern in actions over time; for example, a company that regularly markets very expensive products is using a "high end" strategy.
3. Strategy is position; that is, it reflects decisions to offer particular products or services in particular markets.
4. Strategy is perspective, that is, vision and direction.

Mintzberg argues that strategy emerges over time as intentions collide with and accommodate a changing reality. Thus, one might start with a perspective and conclude that it calls for a certain position, which is to be achieved by way of a carefully crafted plan, with the eventual outcome and strategy reflected in a pattern evident in decisions and actions over time. This pattern in decisions and actions defines what Mintzberg called "realized" or emergent strategy.

Mintzberg’s typology has support in the earlier writings of others concerned with strategy in the business world, most notably, Kenneth Andrews, a Harvard Business School professor and for many years editor of the Harvard Business Review.

Strategy According to Kenneth Andrews

Kenneth Andrews presents this lengthy definition of strategy in his book, The Concept of Corporate Strategy [4]:

"Corporate strategy is the pattern [italics added] of decisions in a company that determines and reveals its objectives, purposes, or goals, produces the principal policies and plans for achieving those goals, and defines the range of business the company is to pursue, the kind of economic and human organization it is or intends to be, and the nature of the economic and non-economic contribution it intends to make to its shareholders, employees, customers, and communities. (pp.18-19)."

Andrew’s definition obviously anticipates Mintzberg’s attention to pattern, plan, and perspective. Andrews also draws a distinction between "corporate strategy," which determines the businesses in which a company will compete, and "business strategy," which defines the basis of competition for a given business. Thus, he also anticipated "position" as a form of strategy. Strategy as the basis for competition brings us to another Harvard Business School professor, Michael Porter, the undisputed guru of competitive strategy.

Strategy According to Michael Porter

In a 1996 Harvard Business Review article [5] and in an earlier book [6], Porter argues that competitive strategy is "about being different." He adds, "It means deliberately choosing a different set of activities to deliver a unique mix of value." In short, Porter argues that strategy is about competitive position, about differentiating yourself in the eyes of the customer, about adding value through a mix of activities different from those used by competitors. In his earlier book, Porter defines competitive strategy as "a combination of the ends (goals) for which the firm is striving and the means (policies) by which it is seeking to get there." Thus, Porter seems to embrace strategy as both plan and position. (It should be noted that Porter writes about competitive strategy, not about strategy in general.)

Strategy According to Kepner-Tregoe

In Top Management Strategy [7], Benjamin Tregoe and John Zimmerman, of Kepner-Tregoe, Inc., define strategy as "the framework which guides those choices that determine the nature and direction of an organization." Ultimately, this boils down to selecting products (or services) to offer and the markets in which to offer them. Tregoe and Zimmerman urge executives to base these decisions on a single "driving force" of the business. Although there are nine possible driving forces, only one can serve as the basis for strategy for a given business. The nine possibilities are listed below:

Products offered	Production capability	Natural resources
Market needs	Method of sale	Size/growth
Technology	Method of distribution	Return/profit

It seems Tregoe and Zimmerman take the position that strategy is essentially a matter of perspective.

Strategy According to Michel Robert

Michel Robert takes a similar view of strategy in, Strategy Pure & Simple [8], where he argues that the real issues are "strategic management" and "thinking strategically." For Robert, this boils down to decisions pertaining to four factors:

Products and services	Market segments
Customers	Geographic areas

Like Tregoe and Zimmerman, Robert claims that decisions about which products and services to offer, the customers to be served, the market segments in which to operate, and the geographic areas of operations should be made on the basis of a single "driving force." Again, like Tregoe and Zimmerman, Robert claims that several possible driving forces exist but only one can be the basis for strategy. The 10 driving forces cited by Robert are:

Product-service	Sales-marketing method
User-customer	Distribution method
Market type	Natural resources
Production capacity-capability	Size/growth
Technology	Return/profit

Strategy According to Treacy and Wiersema

The notion of restricting the basis on which strategy might be formulated has been carried one step farther by Michael Treacy and Fred Wiersema, authors of The Discipline of Market Leaders [9]. In the Harvard Business Review article that presaged their book [10], Treacy and Wiersema assert that companies achieve leadership positions by narrowing, not broadening their business focus. Treacy and Wiersema identify three "value-disciplines" that can serve as the basis for strategy: operational excellence, customer intimacy, and product leadership. As with driving forces, only one of these value disciplines can serve as the basis for strategy. Treacy and Wiersema’s three value disciplines are briefly defined below:

Operational Excellence	Strategy is predicated on the production and delivery of products and services. The objective is to lead the industry in terms of price and convenience.
Customer Intimacy	Strategy is predicated on tailoring and shaping products and services to fit an increasingly fine definition of the customer. The objective is long-term customer loyalty and long-term customer profitability.
Product Leadership	Strategy is predicated on producing a continuous stream of state-of-the-art products and services. The objective is the quick commercialization of new ideas.

Each of the three value disciplines suggests different requirements. Operational Excellence implies world-class marketing, manufacturing, and distribution processes. Customer Intimacy suggests staying close to the customer and entails long-term relationships. Product Leadership clearly hinges on market-focused R&D as well as organizational nimbleness and agility.

What Is Strategy?

What, then, is strategy? Is it a plan? Does it refer to how we will obtain the ends we seek? Is it a position taken? Just as military forces might take the high ground prior to engaging the enemy, might a business take the position of low-cost provider? Or does strategy refer to perspective, to the view one takes of matters, and to the purposes, directions, decisions and actions stemming from this view? Lastly, does strategy refer to a pattern in our decisions and actions? For example, does repeatedly copying a competitor’s new product offerings signal a "me too" strategy? Just what is strategy?

Strategy is all these—it is perspective, position, plan, and pattern. Strategy is the bridge between policy or high-order goals on the one hand and tactics or concrete actions on the other. Strategy and tactics together straddle the gap between ends and means. In short, strategy is a term that refers to a complex web of thoughts, ideas, insights, experiences, goals, expertise, memories, perceptions, and expectations that provides general guidance for specific actions in pursuit of particular ends. Strategy is at once the course we chart, the journey we imagine and, at the same time, it is the course we steer, the trip we actually make. Even when we are embarking on a voyage of discovery, with no particular destination in mind, the voyage has a purpose, an outcome, an end to be kept in view.

Strategy, then, has no existence apart from the ends sought. It is a general framework that provides guidance for actions to be taken and, at the same time, is shaped by the actions taken. This means that the necessary precondition for formulating strategy is a clear and widespread understanding of the ends to be obtained. Without these ends in view, action is purely tactical and can quickly degenerate into nothing more than a flailing about.

When there are no "ends in view" for the organization writ large, strategies still exist and they are still operational, even highly effective, but for an individual or unit, not for the organization as a whole. The risks of not having a set of company-wide ends clearly in view include missed opportunities, fragmented and wasted effort, working at cross purposes, and internecine warfare. A comment from Lionel Urwick's classic Harvard Business Review article regarding the span of control is applicable here [11]:

"There is nothing which rots morale more quickly and more completely than . . . the feeling that those in authority do not know their own minds."

For the leadership of an organization to remain unclear or to vacillate regarding ends, strategy, tactics and means is to not know their own minds. The accompanying loss of morale is enormous.

One possible outcome of such a state of affairs is the emergence of a new dominant coalition within the existing authority structure of the enterprise, one that will augment established authority in articulating the ends toward which the company will strive. Also possible is the weakening of authority and the eventual collapse of the formal organization. No amount of strategizing or strategic planning will compensate for the absence of a clear and widespread understanding of the ends sought.

The Practical Question: How?

How does one determine, articulate and communicate company-wide ends? How does one ensure understanding and obtain commitment to these ends? The quick answers are as follows:

The ends to be obtained are determined through discussions and debates regarding the company's future in light of its current situation. Even a SWOT analysis (an assessment of Strengths, Weaknesses, Opportunities and Threats) is conducted based on current perceptions.

The ends settled on are articulated in plain language, free from flowery words and political "spin." The risk of misdirection is too great to tolerate unfettered wordsmithing. Moreover, the ends are communicated regularly, repeatedly, through a variety of channels and avenues. There is no end to their communication.

Understanding is ensured via discussion, dialog and even debate, in a word, through conversations. These conversations are liberally sprinkled with examples, for instances, and what ifs. Initially, the CEO bears the burden of these conversations with staff. As more people come to understand and commit to the ends being sought, this communications burden can be shared with others. However, the CEO can never completely relinquish it. The CEO is the keeper of the vision and, periodically, must be seen reaffirming it.

Ultimately, the ends sought can be expressed via a scorecard or some other device for measuring and publicly reporting on company performance. Individual effort can then be assessed in light of these same ends. Suppose, for instance, that a company has these ends in mind: improved customer service and satisfaction, reduced costs, increased productivity, and increasing revenues from new products and services. It is a simple and undeniably relevant matter for managers to periodically ask the following questions of the employees reporting to them:

• What have you done to improve customer service?
• What have you done to improve customer satisfaction?
• What have you done to reduce costs?
• What have you done to increase productivity?
• What have you done to increase revenues from new products and services?

The Decisions Are the Same

No matter which definition of strategy one uses, the decisions called for are the same. These decisions pertain to choices between and among products and services, customers and markets, distribution channels, technologies, pricing, and geographic operations, to name a few. What is required is a structured, disciplined, systematic way of making these decisions. Using the "driving forces" approach is one option. Choosing on the basis of "value disciplines" is another. Committing on the basis of "value-chain analysis" is yet a third. Using all three as a system of cross-checks is also a possibility.

Some Fundamental Questions

Regardless of the definition of strategy, or the many factors affecting the choice of corporate or competitive strategy, there are some fundamental questions to be asked and answered. These include the following:

Related to Mission & Vision	Who are we? What do we do? Why are we here? What kind of company are we? What kind of company do we want to become? What kind of company must we become?
Related to Corporate Strategy	What is the current strategy, implicit or explicit? What assumptions have to hold for the current strategy to be viable? What is happening in the larger, social and educational environments? What are our growth, size, and profitability goals? In which markets will we compete? In which businesses? In which geographic areas?
Related to Competitive Strategy	What is the current strategy, implicit or explicit? What assumptions have to hold for the current strategy to be viable? What is happening in the industry, with our competitors, and in general? What are our growth, size, and profitability goals? What products and services will we offer? To what customers or users? How will the selling/buying decisions be made? How will we distribute our products and services? What technologies will we employ? What capabilities and capacities will we require? Which ones are core? What will we make, what will we buy, and what will we acquire through alliance? What are our options? On what basis will we compete?

Some Concluding Remarks

1. Strategy has been borrowed from the military and adapted for business use. In truth, very little adaptation is required.
2. Strategy is about means. It is about the attainment of ends, not their specification. The specification of ends is a matter of stating those future conditions and circumstances toward which effort is to be devoted until such time as those ends are obtained.
3. Strategy is concerned with how you will achieve your aims, not with what those aims are or ought to be, or how they are established. If strategy has any meaning at all, it is only in relation to some aim or end in view.
4. Strategy is one element in a four-part structure. First are the ends to be obtained. Second are the strategies for obtaining them, the ways in which resources will be deployed. Third are tactics, the ways in which resources that have been deployed are actually used or employed. Fourth and last are the resources themselves, the means at our disposal. Thus it is that strategy and tactics bridge the gap between ends and means.
5. Establishing the aims or ends of an enterprise is a matter of policy and the root words there are both Greek: politeia and polites—the state and the people. Determining the ends of an enterprise is mainly a matter of governance not management and, conversely, achieving them is mostly a matter of management not governance.
6. Those who govern are responsible for seeing to it that the ends of the enterprise are clear to the people who people that enterprise and that these ends are legitimate, ethical and that they benefit the enterprise and its members.
7. Strategy is the joint province of those who govern and those who manage. Tactics belong to those who manage. Means or resources are jointly controlled. Those who govern and manage are jointly responsible for the deployment of resources. Those who manage are responsible for the employment of those resources—but always in the context of the ends sought and the strategy for their achievement.
8. Over time, the employment of resources yields actual results and these, in light of intended results, shape the future deployment of resources. Thus it is that "realized" strategy emerges from the pattern of actions and decisions. And thus it is that strategy is an adaptive, evolving view of what is required to obtain the ends in view.

This paper has taken a broad, multi-faceted look at the subject of strategy. Some readers might go away disappointed that no final, unambiguous definition of strategy has been provided. The quick response is that there is none, that strategy is a broad, ambiguous topic. We must all come to our own understanding, definition, and meaning. Helping the reader do so is the chief aim of this paper.

References

1. Strategy (1967). B. H. Liddell Hart. Basic Books.
2. Strategic Planning (1979). George Steiner. Free Press.
3. The Rise and Fall of Strategic Planning (1994). Henry Mintzberg. Basic Books.
4. The Concept of Corporate Strategy, 2^nd Edition (1980). Kenneth Andrews. Dow-Jones Irwin.
5. "What is Strategy?" Michael Porter. Harvard Business Review (Nov-Dec 1996).
6. Competitive Strategy (1986). Michael Porter. Harvard Business School Press.
7. Top Management Strategy (1980). Benjamin Tregoe and John Zimmerman. Simon and Schuster.
8. Strategy: Pure and Simple (1993). Michel Robert. McGraw-Hill.
9. The Discipline of Market Leaders (1994). Michael Treacy and Fred Wiersema. Addison-Wesley.
10. "Customer Intimacy and Other Value Disciplines." Michael Treacy and Fred Wiersema. Harvard Business Review (Jan-Feb 1993).
11. "The Span of Control." Lionel Urwick. Harvard Business Review (May-Jun 1956)

Realising the NEED for Change

Recognise that Change is a constant. As Darwin Said, it's not the Strongest Organisms that win, it's the most adaptable. And that's precisely what STANDARDS enable.

Foward excerpt from Jonathan Schwartz, CEO, Sun Microsystems Inc. from Principles of Enterprise IT Architecture, an excellent book by Infoscions.

Seven Saving Graces for Managers

The Seven Saving Graces for Managers

by George Hallenbeck provided by

In managerial and executive success, it is what comes after the "but" that is important. Executives are generally hard-charging drivers with rough edges. They are often not out to please people but are focused on getting things done. What does the research say about the characteristics that keep an executive in favor, even if he or she possesses some flaws or shortcomings?

"He can be awfully shrewd and is always looking for an angle, but you eventually realize that he has got the company's best interests at heart and is not looking out just for himself." And, "She can be very forward and biting with her ideas and opinions, but she is also willing to take the time to listen carefully to your point of view." Or, "He can be pretty rough on people, but underneath he is compassionate and considerate."

What comes after the "but" are called saving graces -- qualities or redeeming features that make up for other generally negative characteristics.

Saving graces serve as balancers so that the driver strengths that got you where you are do not go into overdrive and damage your efforts. They also offer benefits of their own. Because many saving graces contribute to perceptions of you as someone who is trustworthy, considerate, and insightful, they can help you more easily acquire information from key people, gain access to limited resources, and navigate the bureaucracy.

The saving graces are listed in order of importance:

1. Listening: Taking the time to listen can get you out of more jams than the rest of the saving graces combined. It is the ultimate way of demonstrating that it is not all about you and your agenda, and it is an excellent tool for breaking down barriers and getting more out of what you do with others. Few executives are good listeners.

2. Approachability: The best executives need to be early knowers, especially when it comes to negative information. The best executives are easy to talk to, even when conveying or having potentially bad information conveyed to them. To be effective, approachability has to be combined with listening. Executives tend to play 20 Questions: "Where did you get the information? Who else knows? Why didn't I hear about that before?" This is not a best practice for effective executives.

3. Boss Relationships: Those who tend to venture into deep and dangerous waters find that it can be very difficult to swim alone. If you tend to stir up controversy and are quick to engage in conflict, it is helpful to have the advice and counsel of a seasoned boss who can coach you through such situations and provide some support when you falter. Making your boss successful is Job One, whether you like him or her or not.

4. Integrity and Trust: This one speaks for itself. The people you lead will often forgive a lot if they can clearly perceive that you speak the truth and are a person of your word.

5. Humor: The use of humor to make others comfortable is a useful skill. Using self-deprecating humor is one of the better techniques. It puts others at ease and makes your thoughts appear to come from someplace a little more accessible. Humor allows you to become approachable by putting others at ease when in your presence.

6. Interpersonal Savvy: Being able to relate 360 degrees is important. Finding a way to make a connection with individuals up and down the chain and inside and outside the organization gives you something to rely on when things are not going so well. Diplomacy, tact, and knowing what to say and when to say it can take the tension out of situations and make unpopular decisions and unfortunate mistakes easier to deal with.

7. Understanding Others: The focus here is on groups rather than individuals. Understanding others is about knowing what makes one group different from another and why that matters. This is more difficult to master than listening, but learning to identify what is important to a group and why is often the key for gaining buy-in and knowing how to lead through difficult situations.

Saving graces are not the fire extinguisher you pull out in the case of emergency, but are more the trusty life preserver you should wear at all times, in calm waters and rough seas. Saving graces lead to longer tenure and staying power when coupled with the power skills like drive, strategy, results, and power. They can compensate for mistakes that would get those people who don't possess them into trouble. They smooth out the rough edges and can help smooth over rough situations.

Renaissance in Managing Health Records

Managing Health Records
Its new service will store your data in one place—and search ads could make it pay. Will enough people put their trust in HealthVault?
by Jay Greene for BusinessWeek

Step into a medical office, and you're faced with a paradox of modern medicine. Just beyond the receptionist's desk are all sorts of cutting-edge medical technology. Computed tomography scanners. Electrocardiogram machines. Bone densitometers.
But as you approach that desk to check in, you take a trip back in time. There the receptionist hands you a clipboard of forms. For the umpteenth time you fill in your name, age, allergies, medical history, and the like. For all the medical breakthroughs created by technology, medical records remain an anachronism.

That's changing as more companies vie to bring medical records into the Digital Age. Webmd Health Corp. (WBMD) and insurers such as Aetna (AET), United HealthCare (UNH), and WellPoint (WLP) have provided electronic medical records to policyholders for years. More recently large employers such as Wal-Mart (WMT) and AT&T (T) have been banding together to offer electronic health record systems. Revolution Health Group, led by former America Online (TWX) boss Steve Case, is trying to crack the market, as is search giant Google (GOOG).

Introducing the Contender from RedmondNow, Microsoft Corp. (MSFT) is joining the fray. On Oct. 4 the software giant is scheduled to launch a search engine-supported service to help patients coordinate disparate pieces of health-care information, from lab results and prescription records to X-rays and daily blood pressure and allergy readings. Aware that patients are skittish about putting the most personal data into a file server that's potentially available to prying eyes, Microsoft promises that patients alone will control access to their health information.

Privacy concerns aren't the only reason Microsoft may have a tough go of it. Patient health records are about as resistant to information technology as the common cold is to a cure. Doctors with small practices haven't always been keen to make the investment in computer systems when the payoff seems so unclear. Few hospitals have bothered to set up systems to retrieve data from patients' electronic files.

New EquationPerhaps the biggest hurdle, though, is that there isn't any real economic incentive to digitize data. Paying for the computers that handle and store medical data, not to mention training office staff to use the systems, costs money. And the financial payoff is uncertain, at best. Dr. Robert A. Jenders, an internist who also works in the medical information systems unit at Cedars-Sinai Medical Center in Los Angeles, says initiatives such as Microsoft's are encouraging. But the amount of training needed to switch over to computerized systems may be more trouble than it's worth for many time-stressed physicians. "Their office practice works very well as it is now," Jenders says. "And time is money."
Microsoft, though, figures it can succeed where others have stumbled. It has changed the economic equation so that hospitals and doctors don't need to invest in new equipment to use HealthVault, its online repository for patient health information. Medical records software vendors, such as Allscripts Healthcare Solutions (MDRX), have worked with Microsoft so that doctors using Allscripts' software can easily send files over the Web to HealthVault. Doctors' offices that don't use such software can securely fax the data into a patient's digital files.
To launch and build HealthVault, Microsoft has enlisted Peter Neupert. A Microsoft veteran, Neupert forged the deal that created MSNBC in the mid-1990s and later launched the online magazine Slate. He left the company in 1998 to successfully introduce Drugstore.com (DSCM), where he stayed until 2004 before rejoining Microsoft in the wake of the dot-com bust. Neupert, now head of Microsoft's Health Solutions Group, figures he can build a business that generates "a billion-plus" in revenue from HealthVault as well as another business that sells software to hospitals.

"All About Search"Microsoft is hoping it can make money on the service—which is free to patients—with help from a little box inside HealthVault's page, where consumers can search the Web. The box connects customers to a health-care search engine created by Medstory, a Foster City (Calif.) company that Microsoft acquired in February. Unlike the traditional list of links produced by general-interest search engines such as Google or Microsoft's Live.com, Medstory queries generate health-specific information, grouped together under topics such as clinical studies, nutrition, and medication.

There's also a spot for sponsored links. And that's where Microsoft is betting it can make money. A recent Harris Interactive (HPOL) poll found that 76% of adults over 55 use the Web to help diagnose their medical conditions. Those queries generate $500 million to $1 billion in advertising a year, according to Microsoft's estimates. "It's all about search," says Neupert, who sees the market growing to $5 billion in five to seven years.

If Microsoft can funnel more of those queries through its search engine, it can easily justify the business and, in the process, gain a step on Google, which is pushing forward with its own health-care-records initiative. The search engine giant hasn't been forthcoming with details, but reports say its efforts have been delayed until at least 2008 following the unexpected departure of former Microsoft engineer Adam Bosworth, who was leading the charge.
Also working to Microsoft's advantage is that most medical information is already in digital form, ready to be gathered up in one place. Terabytes of electronic health-care data already exist, scattered on the servers of pharmacies, insurers, hospitals, and many doctors' offices. But the records typically are on disconnected systems. That's because the information isn't collected to help patients as much as it is gathered to make sure people are paid. With the data in one place, any doctor should have access to it.

Patient Buy-in RequiredBut to get HealthVault off the ground, Microsoft will have to persuade people to opt in. Those with the most to gain may be patients with chronic ailments. Diabetics, for example, monitor their blood sugar daily with a glucometer, and many of the devices can connect to a PC so users can keep track of their readings. Microsoft has worked with one of the largest makers of gluco­meters, Johnson & Johnson's (JNJ) LifeScan unit, to enable consumers to connect to HealthVault. That way, patient information could be instantly added to a person's medical records and, in turn, be made immediately available to the diabetic's endocrinologist.

Convincing patients that Microsoft can safeguard their data, though, won't be easy. Dr. Deborah C. Peel, the founder and chair of the consumer advocacy group Patient Privacy Rights, says she believes Microsoft's servers are about as secure as they get. That's because "if they spill the data, it would completely ruin" Microsoft's reputation, says Peel. "It would be like the Exxon Valdez."

Microsoft is willing to take that risk—and is betting that putting a trove of information in patients' hands will ultimately make money while improving health care. For Microsoft, HealthVault isn't so much a leap in technology as it is a smart business bet. "This isn't bleeding edge," says Glen E. Tullman, chief executive of Allscripts. "It's leading edge."

RubyOnRails - Open Source Web FrameWork

RubyOnRails ........
This is an open-source web frame work that's been optimised for Programmer happiness and sustainable Productivity. Favours Convention over Configuration

http://www.rubyonrails.org/

Yet Another Tribute to Open-Source ..............

ChangeToolkit - Kaleidoscope -- the Leadership and Change Toolkit (CTK)

Kaleidoscope - the Leadership and Change Toolkit (CTK), based on the work of Rosabeth Moss Kanter, can help people in organizations improve their effectiveness in both operational and administrative functions. All organizations routinely involve change, which is generally a complex and uncertain undertaking, despite the fact that a large amount of systematic knowledge and understanding about organizational change of all sorts has been gained from research and experience over the last 70 years or so.

http://www.changetoolkit.com/default.aspx

http://www.goodmeasure.com/

http://drfd.hbs.edu/fit/public/facultyInfo.do?facInfo=bio&facEmId=rkanter

KEAS Inc - HealthCare Industry Integration

What is the Keas vision?
If you are one of the many at risk of losing your health, Keas will help you keep healthy. If you’re recovering from an illness Keas will help you to recover and stay well. If you suffer from a chronic disease Keas will help you be as well as you can be. Today no one helps you. You can’t assemble your health data to get the best care possible. Even if you can, your doctors rarely help because the system doesn’t pay them to keep you healthy. You don’t have tools that work online to help in these situations, partly because insurance doesn’t pay for them. Because of these problems people suffer both personal hardship and fear and economic deprivation, sometimes irreversibly. What is more we all pay enormous medical costs for this, and there are costs to society and to the competitiveness of our companies in lost productivity. It is our mission at Keas to fix this for you. Clearly it isn’t an easy mission or a short-term one. While we think we have some great ideas about how to make this possible, we have a lot to learn in the course of this adventure.
What is KEAS culture?
We are all focused on making a great service that the customers love and that truly helps them. We want to have fun and make a difference and get it right. We want to build the service with love and care. Every day, we want to make sure that our customer experience is as good as it can be. This doesn’t mean trying to get it perfect out of the gate. Heck you don’t know until people use it. See my talk on https://admin.acrobat.com/_a13852757/intelligentreaction/" target=_blank>intelligent reaction. What this does mean is pouring resources into constant improvement once the service is out of the gate and steadily learning from the usage patterns to make sure that the service quickly and surely evolves in the right direction. This requires great listening skills and great empathy and great patience and data analysis skills and, oh yes, some creative design insight. It requires the humility to realize that it isn’t your vision for how the UI should look that matters, but what actually works for the customer.

Source : http://adambosworth.net/2007/12/22/talking-about-keas/

X-Team from INSEAD

The X-team principles from INSEAD:

“Good teams often fail because they don’t work consistently and effectively outside their own boundaries,” -Henrik Bresmanm, INSEAD.

According to Bresman, X-teams “balance their internal activity with an equal commitment to external activity. They’re different from traditional teams because they go outside from day one. They keep going outside throughout their lifecycle. The actual balance between internal and external activity shifts as work requires but the external mindset is always there, always present.”

High levels of external activity
Members go outside the team to create effective goals and plans

Extreme execution
The team develops internal processes enabling members to coordinate their work and execute effectively while at the same time carrying out external activity

Flexible phases
X-teams change processes over time to keep products moving along and deal with the demands of different phases of a particular task
Flexibility is important as X-teams go through phases whereby they ‘explore, exploit and export’ in order to keep rolling out products. During the exploration or discovery phase, X-teams map out and make sense of issues. This phase not only involves ‘scouting’ but also the establishment of relationships with key individuals both inside and outside the organisation.

From trying to determine what’s out there, the X-team will then turn ideas into reality, choosing an option and making it happen. This is the exploitation phase when the team decides what it wants to do and how it will organise itself.
The third phase is implementation or exportation. This involves creating enthusiasm within the team and the marketplace as well as getting feedback from top management and the customer.

How X-teams translate ideas into concrete action:

Exploration
The discovery phase:
Map out the context, the issues, etc.
Get buy-in from top management

Exploitation
The design phase:
Choose one option
Engage in prototyping and search for best practices

Exportation
The diffusion phase:
Generate enthusiasm for product within the organisation or marketplace
Get feedback from top management and the customer

Although the three phases follow one another sequentially and are ‘separate modes of activity’, the book points out the ‘process is not always so neat’ in reality. Even so, the authors say, road maps of exploration, exploitation and exportation will help X-teams ‘stay focused and shift gears as needed’.

‘X-factors’ needed to support X-teams:
Extensive ties to useful outsiders
Expandable tiers allow others to ‘drop in’ for short periods to work on specific projects
Exchangeable membership allows a team to include other members as and when necessary and to rotate leadership

From - http://knowledge.insead.edu/contents/Bresman.htm

Balanced Score Card

A Good info on Balanced Score Card : http://www.balancedscorecard.org/FAQs/index.html

How does the balanced scorecard compare to the Six Sigma management approach?

We get this question so frequently that we must assume it is an assignment by management professors to their students everywhere. Here is the definition of Six Sigma from Quality America: "Six Sigma is a Quality Improvement methodology structured to reduce product or service failure rates to a negligible level (roughly 3.4 failures per million opportunities). To achieve these levels, it encompasses all aspects of a business, including management, service delivery, design, production and customer satisfaction."

Think about what this definition assumes. The context is a manufacturing process. The business is producing large numbers of similar products and/or services, maybe in the millions, so that the error rate can be assumed to be normally distributed, and its statistics can be reliably calculated. Therefore, this is a quality improvement approach that is appropriate for manufacturing or basic service organizations where large numbers of repetitive processes are done. In such a business, Six Sigma provides a way of analyzing and improving the quality of processes. Six Sigma was developed at Motorola, GE and Allied Signal. In recent years, the concept has been expanded with training programs and literature, but these basic assumptions remain the same.

Many modern businesses, as well as government and nonprofit organizations, do not have processes that produce large quantities of repetitive products or services. For instance, scientific research and development organizations may manage a handful of very large programs. IT system developers may work for years to build one new system. Disaster management agencies may encounter only a small number of incidents per year. For these "knowledge worker" types of organizations, most of the assets are intangible and many services are unique. In such cases, it is not meaningful to measure defect rates, and the improvement of processes is only one of many strategies a company may adopt. A different type of strategic management and performance improvement system is needed. The balanced scorecard offers an alternative to Six Sigma and other traditional management systems that emerged from industrial production businesses.

However, both Six Sigma and the balanced scorecard practitioners use similar best practices in management to designand deploy these systems. They both require dedicated top-level management support, a dedicated team of change agents, strategic alignment, implementation of improvement initiatives as projects, cultural change management, and a combination of top-down and bottom-up development. Also, Six Sigma practitioners often adopt the balanced scorecard as a way of deriving appropriate performance metrics. There are numerous consulting companies trained in the facilitation and deployment process for either system.

Frequently Asked Questions about the Balanced Scorecard

What is the balanced scorecard?
The balanced scorecard is a measurement-based strategic management and learning system for all organizations. It provides a method of aligning business activities to the strategy, and monitoring performance of strategic goals over time. It was originated by Robert Kaplan and David Norton in about 1990. It may also clarify things by identifying what the balanced scorecard is not: It is not a form of project management. It is not a performance measurement system or a control system or a process improvement system. It is not a tool or technique. It is not a piece of software. It is not an employee evaluation system. It is not the latest "management fad". And it is not kept on paper scorecards. The balanced scorecard may have aspects of some of these things, but they are incidental to what the balanced scorecard is, and what it attempts to do for organizations.

Since most of the work of organizations is packaged in the form of projects, success of the balanced scorecard ultimately depends on the commitment and cooperation of project managers. If the corporate executives have aligned performance measures to strategy, then successful managers should expect appropriate recognition and rewards based on their program's strategic importance as well as its performance.

What are the benefits of the balanced scorecard approach?
Many modern businesses and government agencies hold most of their value in their intangible assets, namely their people, and the knowledge those people have. Also, modern companies recognize that mission success (or competitiveness in the case of commercial companies) is largely driven by the ideas and innovations that come from their people. Industrial-age management practices, focused on financial metrics and supply-chain production, are not appropriate in this new environment. Financial metrics are lagging indicators that tell what happened in the past. Knowledge workers communicate and create in complex ways, and their work does not fit the supply-chain model. Therefore, executives need a new way to assess how well their organization is functioning, how to predict future performance, and how to align the organization toward new strategies to achieve breakthrough performance. The balanced scorecard has evolved to support strategic planning and management this new work environment. The balanced scorecard transforms the strategic plan from an attractive but passive document into the "marching orders" for the organization on a daily basis. It provides a framework that not only provides performance measurements, but helps planners identify what should be measured. It enables excutives to truly execute their strategies.

Are there any disadvantages or problems with the balanced scorecard?
Yes, just as there are challenges associated with any innovative management idea or any effort that seeks to change the status quo in a large organization. It is somewhat difficult and time-consuming to implement a comprehensive balanced scorecard system in a large organization. It will require sustained top-level support and commitment to ramp-up and put the system in place. This is where most of the difficulties and problems emerge. Do not embark on a balanced scorecard initiative unless your organization has a high-ranking champion, has adequate funding, and is ready to meet the challenges of change.However, what is the alternative? Every organization needs to know how well its strategies are performing, how to execute these strategies effectively, and how to collect data to report to its sponsors or customers. Regardless of what it is called, the processes and practices used in successful modern organizations will likely be similar to those of the balanced scorecard.
Isn't the balanced scorecard just the latest management fad that will soon pass away?
The "buzz word" may change, but not the underlying concepts, which are here to stay for a long time -- thinking strategically, measuring performance, evaluating results, feedback -- these are fundamental concepts in management that have been around a long time and will be here in the future. So managers who learn the methods of the balanced scorecard will be in a better position to lead in the future. They will have the right skills to think, plan and assess the success of their organizations -- these skills will be valuable for the forseeable future.

I am a program manager. What's in it for me?
The balanced scorecard is intended as a strategic system for managing a whole portfolio of programs within an organization. However, as a manager of one or more such programs, the balanced scorecard can help you. It raises the visibility of program performance -- not only in traditional on-time, on-budget terms, but also in terms of its strategic significance to the desired outcomes of the whole organization. So, if you know that you are working on a program that is vital and strategic, the balanced scorecard and its measurements can help you to defend your program. Also, since strategy is everyone's job, you can use the balanced scorecard's strategic map to guide the direction of your program to maximize outcome performance. As the de facto expert in your program's definition of performance, you have the right to define what metrics will be used to measure your program's performance -- in many cases, these metrics cannot be dictated from above. You also have the authority and responsibility to measure your own program's performance.

Is the balanced scorecard relevant to private-sector companies?
By now, many major corporations have adopted, or are in the process of implementing the balanced scorecard as their framework for executing strategy and monitoring performance. It has been found to be an effective way to achieve that most elusive of executive goals: execution. Also it has been accepted by most of the business departments of colleges and universities as a part of their management curriculum.

Is the balanced scorecard relevant to government agencies?
Taxpayers, the ultimate customers of government, are demanding more accountability for the use of their funds. They want to see tangible results from all government agencies, at all levels. In the US, this demand is reflected in the Government Performance and Results Act of 1993, one of the most influential new laws affecting how the Federal Government works. More recently, the President's Management Agenda, promulgated by the Office of Management and Budget, includes language requiring performance-based scoring and budgeting of all activities of agencies in accordance with top-level strategies. The balanced scorecard is the only framework readily available that can align strategy, performance and budgeting to meet these requirements. Therefore, government agencies are increasingly looking to the balanced scorecard approach.

Is the balanced scorecard relevant to nonprofit organizations?
Nonprofit organizations are committed to a mission, and they need to focus their limited resources efficiently in order to achieve mission effectiveness and value for their recipients and sponsors. The balanced scorecard system has a multiple focus on several perspectives, including financial performance. For a nonprofit organization, profit is not a determining goal of strategy; alternative financial goals may be related to the cost and value of mission activities. In this case, the balanced scorecard provides a comprehensive framework that will help their directors to define strategies, track performance, and provide data to show their various customer groups how well they are performing in terms of mission value and outcomes.

What companies are using the balanced scorecard?
By 2004, the balanced scorecard has been at least partially implemented in about 57% of global corporations, according to a survey by Bain. This site contains some examples of companies and government organizations that have reported their use of the balanced scorecard.

What are some examples of proven benefits of the balanced scorecard for companies that have implemented it?
In many commercial organizations, the activities and performance associated with strategic plans are proprietary, and not available for outside examination. However, the experience of managers in hundreds of organizations has been reported, with mostly favorable results and some lessons learned. Also, numerous governmental organizations are continuing to adopt the balanced scorecard, with increasing data being reported on the web and increasing satisfaction with the results. We have prepared a database of over 130 of these organizations.

How is the balanced scorecard implemented?
Briefly, these steps are:
Organizational Assessment
Identify Strategic Themes
Define Perspectives and Strategic Objectives
Develop a Strategy Map
Derive Performance Metrics
Craft and Prioritize Strategic Initiatives
Automate and Communicate
Cascade the BSC Through the Organization
Collect Data, Evaluate and Revise

How is the balanced scorecard implemented in ... (your business sector here).
Every business sector or company has some generic processes, as well as some unique processes or features. If this were not the case, your company would be no different from its competitors. For governmental organizations, although there is no competition, there should also be no duplication; each agency and jurisdiction is unique. It is not possible on this web site to describe the special features of each business sector's balanced scorecard. The generic features appropriate for most organizations are described here. For specific application to your company, we recommend that you obtain initial training, and incorporate balanced scorecard steps into your strategic planning process. To accelerate the initial implementation, the services of an experienced consultant are worthwhile. These preparatory steps will provide a rapid and customized approach to implementing the balanced scorecard for your company's needs.

How long does it take to implement?
Typically, building and implementing the corporate-level (Tier 1) balanced scorecard (the first 7 steps in our process) takes about 2-3 months, depending on several factors. This effort is usually done by a cross-functional team guided by an experienced balanced scorecard facilitator. Some consultants claim that it can be done in a much shorter time, but that is unrealistic. The original text of Kaplan & Norton on the balanced scorecard estimated a total time of 26 months for full deployment of the balanced scorecard down to the level of individual employees (Tier 3). In any case, a sustained effort at change management and education is needed.

How much does it cost to implement?
The total cost may be estimated as follows:
No. of team members x time on team activities
Facilitator cost
RFP and software evaluation labor cost
Software licensing cost
Installation and testing cost
Annual maintenance and upgrade cost (typically 20% of initial cost)

How does the balanced scorecard compare to the Six Sigma management approach?
We get this question so frequently that we must assume it is an assignment by management professors to their students everywhere. Here is the definition of Six Sigma from Quality America: "Six Sigma is a Quality Improvement methodology structured to reduce product or service failure rates to a negligible level (roughly 3.4 failures per million opportunities). To achieve these levels, it encompasses all aspects of a business, including management, service delivery, design, production and customer satisfaction."

Think about what this definition assumes. The context is a manufacturing process. The business is producing large numbers of similar products and/or services, maybe in the millions, so that the error rate can be assumed to be normally distributed, and its statistics can be reliably calculated. Therefore, this is a quality improvement approach that is appropriate for manufacturing or basic service organizations where large numbers of repetitive processes are done. In such a business, Six Sigma provides a way of analyzing and improving the quality of processes. Six Sigma was developed at Motorola, GE and Allied Signal. In recent years, the concept has been expanded with training programs and literature, but these basic assumptions remain the same.

Many modern businesses, as well as government and nonprofit organizations, do not have processes that produce large quantities of repetitive products or services. For instance, scientific research and development organizations may manage a handful of very large programs. IT system developers may work for years to build one new system. Disaster management agencies may encounter only a small number of incidents per year. For these "knowledge worker" types of organizations, most of the assets are intangible and many services are unique. In such cases, it is not meaningful to measure defect rates, and the improvement of processes is only one of many strategies a company may adopt. A different type of strategic management and performance improvement system is needed. The balanced scorecard offers an alternative to Six Sigma and other traditional management systems that emerged from industrial production businesses.

However, both Six Sigma and the balanced scorecard practitioners use similar best practices in management to designand deploy these systems. They both require dedicated top-level management support, a dedicated team of change agents, strategic alignment, implementation of improvement initiatives as projects, cultural change management, and a combination of top-down and bottom-up development. Also, Six Sigma practitioners often adopt the balanced scorecard as a way of deriving appropriate performance metrics. There are numerous consulting companies trained in the facilitation and deployment process for either system.

How does an activity-based costing (ABC) system compare to the balanced scorecard?
ABC can provide valuable information on where funds are being spent in an organization's business activities and processes. This information provides an important input to the balanced scorecard's financial and business process perspectives. Although it is difficult to implement ABC, a simplified approach is being developed by Dr. Robert Kaplan, who invented both ABC and the BSC. These two tools complement each other and together can lead to a much more effective alignment of resources to strategy.

Can you please give me a list of metrics or KPI's (key performance indicators) for my balanced scorecard?
No. The balanced scorecard is not a cookbook of performance measures. It requires creative strategic thinking and difficult decisions by a large team of people to develop an effective balanced scorecard system. No two organizations are alike. "Some assembly is required."

How does the balanced scorecard compare to the Baldrige? EFQM? APIC?
The Baldrige Award, the European EFQM, and APIC (Army Performance Improvement Criteria) are examples of organizational assessment tools. Assessment of an organization's current status is the first step in our nine-step methodology for building a balanced scorecard. The balanced scorecard uses assessment data to determine what improvements and breakthroughs in performance are most needed, so that strategies can be crafted to meet these needs. The BSC includes much more than assessment, but these tools are useful to get a full picture of the situation in an organization, and they are recommended as an initial step in strategic planning and management.

What are the implications of balanced scorecard on budgetary systems?
The balanced scorecard, being a strategic management system, can serve as the "front end" for a performance-based budget. Its performance measures and strategic plans can provide rational guidance for resource allocation. In fact, some organizations have gone so far as to develop flexible strategic organizations and financial management systems that allow continuous reallocation of funds, without the need for major cyclical efforts in budgeting.
Where can we get training?

How can we ensure that our balanced scorecard system is maintained in the long term?
It is important not only to build the system right, but to maintain it by continual use and re-education of personnel on its purpose and benefits. Since everything is changing in the business environment, a balanced scorecard program is never "done" -- it is an ongoing journey. So the key is to maintain strategic alignment to the top-level mission and the desired long-term strategic results -- these are unlikely to change much, and they provide a "pivot" around which everything else revolves. Leaders should help to clarify this vision. Use our recommended communication techniques to keep people focused on these results and the strategies for getting there.

An inspiring Indian in Corporate America/World

An inspiring Indian in Corporate America/World:

The strange existence of Ram Charan

What he does is hard to describe. But the most powerful CEOs love it enough to keep him on the road 24/7 and make him the most influential consultant alive. By Fortune's David Whitford

The Al Manzil Hotel in Dubai has been open for business all of 18 days on the Saturday night in January that I show up with Ram Charan. The lobby is strangely quiet; there doesn't seem to be anybody else staying here. The surrounding neighborhood is called Old Town, but in fact it's a construction site from which are rising what will one day be the world's tallest skyscraper and the world's biggest mall. Soulless and kind of creepy, I'm thinking, but Charan's thoughts are elsewhere.

Already he has claimed an overstuffed chair in the center of the lobby and is talking on the phone. After 12 hours of isolation on the flight from J.F.K., Charan is back in business, deep in private conversation with a client in New York City. He looks tired, and no wonder. He began his day with a 4 A.M. Friday wake-up call in Richmond (he did a Squawk Box live remote on CNBC), and he has a head cold. But he is in no hurry to go to bed. Charan doesn't care what time it is. He doesn't care what day of the week it is. And the last thing he cares about is where he is. As long as Charan is with a client - or can get one on the phone - he's home.
Thirty years ago this month, Ram Charan (pronounced "Rahm Scha-RON") quit a tenured professorship at Boston University to devote himself full-time to consulting. Today he's alone at the top of his profession - not a consultant so much as a guru, a corporate sage, with unparalleled access to boardrooms across the globe and intimate, enduring relationships with an array of powerful CEOs.

Among them: Jack Welch, formerly of GE (Charts, Fortune 500), who says of Charan, "He has this rare ability to distill meaningful from meaningless and transfer it to others in a quiet, effective way without destroying confidences"; Dick Harrington of Thomson Corp. (Charts) ("He probably knows more about corporate America than anybody"); and Verizon's (Charts, Fortune 500) Ivan Seidenberg ("I love him. He's my secret weapon"). "He's like your conscience," says former Citicorp CEO John Reed. "Just when you sort of think you have everything done and you're feeling pretty good about yourself, he calls you up and says, 'Hey, Reed, did you do this and that and the other?'"

There's another aspect of Charan, not unrelated to his success, that sets him apart from his peers, if not the whole human race: what Jack Krol calls Charan's "strange existence." "When I was chairman and CEO of DuPont," says Krol, "he'd show up at the house Sunday morning at nine, and we might spend three or four hours, and all of a sudden he'd disappear. He would go anywhere at any time that you asked him to meet with you. Business is his whole life."

That sounds like an exaggeration, but it's not. Having uploaded himself into the global economy, Charan circulates, continuously, with something like the speed and efficiency of capital. Consider the itinerary he sketched at dinner one night a few months ago in New York. He had just agreed - for the first time in his career -to let a journalist travel with him and watch him work. "I should tell you where I've been the last few weeks," he began in heavily accented English. "I go to India on the Friday of the week before Thanksgiving. I am Sunday morning in Bombay. Monday morning I am in Delhi. Wednesday I'm in Bombay. Thursday I'm in Bangalore. Saturday I'm in Trivandrum. Wednesday I'm in Johannesburg. Friday morning, at seven, I am in New York. I have a two-hour meeting with a CEO who has flown in to see me. I have two more meetings and I fly out that night to Dubai. I am in Dubai on Sunday and Monday, then I come back here. On Thursday night I fly out to Jubail, Saudi Arabia. Then I come back here. Tuesday morning I have a whole-day schedule in New York. Tuesday night I go to Milwaukee. I came from Milwaukee last night. They diverted my plane so I had to stay in Pittsburgh. I had a meeting this morning in Philadelphia. I had three meetings here in the afternoon. And I'm here tomorrow, with GE. Then an hour-and-a-half phone call. Then I'm going out tomorrow night to West Palm Beach. Monday morning I have a breakfast meeting in New York. And then I'm flying out to Perth, Australia." At least he flies first-class.
Now consider what comes next: more of the same. Charan never stops. He sleeps in a hotel every night ("Professor Charan, welcome home," is how the doorman greets him at the Waldorf on Park Avenue), except when he's sleeping on a plane or, rarely, in someone's house, which can happen when a client takes pity on him. "I got in the habit of having him over for Christmas because he had no place to go," says Reed. "He was going to sit in a hotel room. That's hardly right."

Before he was a consultant, Charan lived in dormitories. Before he was a professor and a student, he lived in YMCAs. Now he doesn't live anywhere. Charan's one nod to a conventional rooted life is the office he rents on North Central Expressway in Dallas (that's the address on his passport - he is a U.S. citizen), but he can't tell you anything about it because he's never been there.
"I really thought the two ladies I interviewed with six years ago were just yanking my chain," says Cynthia Burr, who manages Charan's hideous schedule. "I said, 'Where does he keep his stuff? Everybody has stuff.' It's really hard to wrap your arms around something like that, but it's true."
Three days a week - on Monday, Wednesday, and Friday - Burr and a colleague pack a cardboard box with shirts, underwear, and socks, perhaps a clean suit (there is a tailor at Neiman Marcus who has Charan's measurements on file), and maybe a V-neck sweater or a pair of khaki pants. They toss in toothpaste, razors, shampoo, a shined pair of 9½ EEEE shoes, whatever he needs ("He doesn't buy anything himself," says Burr), and send it by FedEx to Charan's hotel, wherever that may be. The box comes back two days later filled with dirty laundry.

Charan doesn't own a car because he never learned how to drive, and besides, where would he keep it? A plane, perhaps? With a day rate that clients say can top $20,000, he could afford one. "If I was Ram, the one thing I'd have is one hell of a nice plane," says his friend Bill Conaty, senior VP for human resources at GE. But Charan is not Conaty. "I use the time sitting in the terminal," he says. "I have never missed an appointment in my life. I don't want to get lost in this private-plane business." (He does regret, however, not accepting an offer from American Airlines in the 1970s to buy a lifetime first-class upgrade for $100,000.)
He trundles through airports pulling a mismatched pair of black canvas rollers, one held together with maroon duct tape. His watch is a Timex. Given all the hours he spends in transit and his lifelong passion for the Indian vocalist Lata Mangeshkar, I suggested once that he might enjoy an iPod. The idea seemed to upset him: "No, I don't do that, I couldn't do it. Would just distract me. Music can make you very sentimental. Couldn't do it."
Have I mentioned that Charan has never married? That he has no children? And still I haven't come to possibly the most peculiar aspect of his personality. I mean that which sets him apart from virtually every person he comes in contact with, none more so than his overachieving CEO clients: Charan has no goals. He never set out to become a globetrotting consultant, any more than he dreamed of attending Harvard Business School, or becoming a professor, or even so much as one day earning a living beyond the small city in India where he was born.

Charan's weird and wonderful life is an unintended byproduct of dedication, he insists. Dedication to learning and teaching and service, to the whole set of Hindu virtues embodied by one of Charan's favorite phrases, "Purpose before self." "People used to ask me, What is your ambition?" says Charan, who turned 67 this past Christmas. "I say I have none. My dedication is going to take me where I'm going to be."
"Tell me his three God's gifts"
Charan follows his driver out the door of the hotel in Dubai on Sunday morning. "We'll see how it goes," he says, then sneezes. "The nose is not running." With that he's off to an all-day meeting at Emaar Properties, the Persian Gulf behemoth that's developing both the skyscraper and the mall. The limo zooms along on newly built freeways, past a string of galloping mounted camels at Dubai's Nad Al Sheba racetrack, through a dusty desert landscape cluttered with cranes, cement mixers, and rebar. ("Look at all that skyline," Charan murmurs.)
Once inside the gated Emaar compound, he is led upstairs to a conference room overlooking a vivid green golf course. Tom Bartridge, Emaar's American HR director (who thinks "Ram" rhymes with "bam"), is here waiting, and after a few moments V.K. Gomber, strategic advisor to the chairman, walks in. Charan shakes hands all around ("V.K., good morning, sir, how are you?"), says yes, thank you, he'll have tea, then heads to the whiteboard.
Ten-year-old Emaar is growing like crazy in the Persian Gulf, in South Asia, and with its recent acquisition of California builder John Laing Homes, in the U.S. Its top challenge now, in Gomber's view, is execution. Can Emaar capitalize on the marvelous opportunities before it? That's largely a people question, Gomber believes, and therefore people will be the focus of Charan's work with Emaar's management team in the months to come. (Charan is flying back to New York tonight but will return to Dubai for a total of 22 days in 2007.)
"Can we bring up the maximum number of people within the organization," says Gomber, "or can we go through the networking that [Charan] has and go outside the organization and identify people? If we can get such people, I think the money is well spent."

For the next five hours Charan walks his charges through a detailed analysis and discussion of Emaar's draft succession-planning template. "A leader who does not produce leaders is not a great leader," he says. "If you agree, I'd like to put that in." (Gomber nods.) Charan is trying to help Emaar construct a document that will help its managers discern in others what he calls "natural talents," or "God's gifts." "Each of us has to be the best calibrator of natural talent of the people who work with us," he says. "What are the three to five most crucial natural-talent items that each person has? It has to be specific" - he taps the whiteboard for emphasis - "and very clear" - tap - "and repeatable" -tap!

"By the way," says Charan, "the last time I talked about Steve Jobs, remember? I've now verified from two directors of Apple, and they say it's right on the button." Gomber and Bartridge perk up their ears. "I asked, Well, tell me his three God's gifts. And they think about it, and they say first thing, this human being has a talent to figure out what the consumer really wants. This is a very valuable thing! No. 2, he has the will and the talent to find - no matter where it is! - the right technology that will deliver what they want. Nobody said he invented one! And third, he has the talent to create demand at the right time. I say, Where do you find those human beings? But he is one."

Throughout the afternoon Charan discreetly shares from his store of anecdotes. For example, the time he was sitting in Andy Grove's cubicle sometime in the late '70s when Grove got a call from a Tektronix (Charts) engineer who wanted to work at Intel (Charts, Fortune 500) and was willing to take a 10% pay cut. "And they were a $200 million company at the time," says Charan, "very small. Tektronix was $5 billion. That's brand!" GE has a similarly powerful brand, says Charan. So does P&G (Charts, Fortune 500). So can Emaar, is the idea.
I don't care if I flunk

Later that evening I meet Charan for dinner back at the hotel. Western music plays softly, disconcertingly, in the background. (Eric Clapton, John Lee Hooker, and a cover by someone I can't place of Lowell George's highway traveler's classic, "Willin'" - "I been from Tucson to Tucumcari, Tehachapi to Tonopah.") Charan has a plane to catch at 2 A.M. He has three appointments in New York starting at 9:30 Monday morning. Monday night he flies to Madrid, Tuesday night to Frankfurt, Wednesday morning to Miami. After that, he doesn't know.
Our waitress is a guest worker from India, one of many now in Dubai. "May I call you beti?" Charan asks politely. She nods, blushing at the portly gentleman seated before her, with his backswept gray-streaked hair, smooth round face, and sparkling eyes. "It's an Indian custom," Charan explains after she leaves. "I took her permission first. I may not in India. Even though she has never met me, and I address her as beti" - "daughter" in Hindi -"it's like I am telling her that you will be treated like my own daughter. All threats are out. You see the face changing right away."

Charan's roots are in a small city near Delhi in the north Indian state of Uttar Pradesh. (I can't say which city because Charan has relatives there and worries about kidnapping.) His family (he is the sixth of seven children) lived on the second floor of a two-story house they shared with his uncle's family. Together they were 17 people under one roof. "And then a portion to keep the cows," says Charan. "I personally took the cow dung and made patties out of that for burning in Mother's stove. We cut the fodder in the fodder machine for the cows. My brothers and my uncle did the milking." While they had everything they needed to survive, they had no more than that. No plumbing, no electricity, no luxuries of any kind. The children pumped water from a well. They did their nightly homework on the floor in a flickering circle of light from a mustard-oil lamp.

There was intense fighting between Hindus and Muslims in Charan's city during the struggle for Indian independence. He remembers when he was 7 years old in 1947, watching from the roof of his home as flames destroyed the cloth shop belonging to his father and uncle. After the fire the brothers started over with a shoe shop. Charan was in the shop every morning before school to help open and every afternoon after school until closing. He counted the rupees in the till at the end of the day, inspiring a lifelong appreciation for the "blood" of business. ("Any company I go to, the first thing I check is cash. How's your cash? Where's your cash flow? No blood, you got a problem right away.")

In the lulls between customers, Charan studied. Using a system of his own devising, he condensed onto a single unlined page the essence of what he had learned that day in each subject. (Today he provides similar one-page summaries for his CEO clients.) "Am I going to get good grades?" he would ask himself, knowing there was only one right answer. "Am I the master of this subject?" He knew from Sanskrit teachings that "fear, anger, laziness - these are the downfalls of human beings"; that peace of mind alone is worth striving for; that dedication and mastery are their own rewards.

One by one, most of the older children left school to work in the family business. Charan was an exception. His teachers visited the shop to beg his parents to let him continue his education. At 15, he enrolled as an engineering student at the elite Banaras University in Varanasi, a 250-mile train ride away. He was two years younger than his classmates, a humble member of the trading caste surrounded by "students whose fathers were big business people." He kept quiet because he was self-conscious about his "lousy English." He excelled, graduating third in his class. "Oh, incredible growth!" is how he describes those years. "Incredible learning!"
After college Charan was invited to participate in a work exchange program in Australia. His grandmother pawned her jewelry to buy him a plane ticket. (Charan recorded that debt, together with every cent his family spent on his education, and paid it back within a year. "This is a return of capital," he wrote on the note accompanying final payment.) Charan ran into a problem at the passport office. The application asked for his first and last names. Like most provincial Indians, Charan didn't use a family name. So he split his one name in two, and Ramcharan became Ram Charan.

It was winter when Charan arrived in Sydney. He had never been so cold in his life. A kind woman in the placement office at the University of New South Wales arranged some interviews, but job offers were hard to come by. You can always try gardening, she said. "I'll do that," Charan said. "But I can't go home because I don't have any money."

Finally he found a job as a draftsman at a utility company. He worked days and attended classes at night. Charan soon attracted the attention of his bosses, one of whom invited him one day to his office. Did Charan have any questions he wanted to ask? As a matter of fact, Charan did. He had been studying the financial statements in his spare time, attentive as always to cash flow, and had concluded that the company was borrowing money to pay its dividend. Was this true? Charan's boss was sure it was not. Until he checked with the CFO. Oops. The young Indian's standing rose accordingly.

Encouraged by his bosses, Charan left Australia after four years to attend Harvard Business School. MBA students in the early 1960s had to read and be prepared to discuss as many as three case studies a day, six days a week. One of Charan's more practical section mates suggested they divide the cases, then get together every night to share notes. "I'm not going to do that," Charan said. "I'm spending my own money. I don't care if I flunk. If I learn something, I'll succeed." Charan did not flunk. He completed all the reading and, as was his habit, summarized the notes for each case on a single sheet of paper, which he brought to class for reference during the discussion.
His roommate, Boston real estate developer John Joyce, remembers seeing Charan's grades at the end of the first trimester second year, when Charan took advanced statistics, a class normally reserved for doctoral candidates. "They were all distinction-pluses," says Joyce. "Kind of a stunning achievement."

While at Harvard, Charan worked summers for a gas company in Honolulu. Again, he took it upon himself to study the books, and again he discovered a looming problem with the dividend. This time his boss asked him to solve it. Charan came back six weeks later. "The pressures in the pipes between 10 P.M. and 4 A.M. are too high," he reported. "You take them down, and your gas leakage will go down, and you will make the dividend."

Charan knew this because he had been down to the plant in the middle of the night and read the gauges. He had also noticed that the man in charge of production was not talking to the man in charge of distribution; hence the leakage. In other words, he combined financial acuity with engineering know-how and an eye for the role played by interpersonal relationships to solve a vexing problem. Charan says now, "That's where this whole consulting thing really began."

Charan graduated in the top 3% of his class, a Baker Scholar with high distinction. He stayed to earn a doctoral degree, then joined the faculty. His students nominated him for a best-teacher award, an award he later won at Northwestern. But Charan never excelled at the academic research that leads to tenure at a top-tier school. He was interested more in cause and effect than statistical correlation. His aims were practical: How can I solve this problem? How can I help this person? This company? He began taking on more and more consulting gigs. Most B-school professors consult on the side; in Charan's case, it was his calling. Within a year of arriving at BU, having finally achieved tenure, he concluded, "This is not for me," and stepped into the void. He rented an office in Dallas, in part, he says, because the climate reminded him of India, but really for its central location. Not that he's ever there.

"Don't you ever, ever do that again"

What does Charan really deliver? Some people wonder about that. He is very good at unpacking complexity, at paring business challenges down to their essential elements, often with reference to lessons he learned years ago in the family shoe store. "I've been around Mike Porter and Gary Hamel and every strategy guy in the world," says University of Michigan business professor and Charan friend Noel Tichy. "Many of them get into this look-how-smart-I-am mode. You will never see that with Charan." If you're V.K. Gomber ("I am a strong believer that the businesses are simple"), you value that quality.

But there is a line between simple and simplistic, and some have questioned which side Charan stands on. Skeptics liken him to Chauncey Gardiner, the simple-minded hero of the 1979 film classic Being There, who gets a lot of mileage out of utterances such as "First comes spring and summer, but then we have fall and winter. And then we get spring and summer again."
If Charan is a fake he is an amazingly successful one. What defines his career, even more than the quality of his client roster, is its stability. This is his 37th year working for GE, his 33rd for DuPont. He worked with John Snow for 15 years before Snow left CSX (Charts, Fortune 500) for the Treasury Department; he has been with Ivan Seidenberg at least 20 years, and with former West Virginia Governor Gaston Caperton more than 30 years. Caperton met Charan at a Young Presidents' Organization (YPO) function in the mid-1970s and has been huddling with him ever since.

That is, through the sale of Caperton's once-tiny insurance company in the early 1990s after it had grown to become the tenth-largest privately held brokerage in the country; through Caperton's two terms as governor, during which Charan led talks with business, government, and union leaders on developing an economic strategy for the state; and now in his job as CEO of the College Board. "He's helped me in business, in government, and in the nonprofit," says Caperton.

One of the reasons people keep coming back is Charan's extraordinary devotion to his work. Years ago Charan was leading a workshop at Crotonville, GE's training center in Ossining, N.Y. It was after the merger with RCA in 1987. The employees were mixing for the first time, and things were a little tense. One of the GE guys found out that it was the birthday of one of the RCA guys and hired a belly dancer to mark the occasion. "The dance was just before lunch," says Jim Noel, formerly of GE, now a consultant. "She came in, did her little thing, and left. As we were walking to lunch, Charan came up to me and said, 'Jim,' and he was really serious--at first I thought he was joking. He said, 'Don't you ever, ever, ever do anything like that again.' And these were his exact words: 'Don't you ever defile the classroom in that way.'"

He's like a monk, suggests Caperton. Or a missionary, says John Mahaney, his editor at Crown Business (Charan has written 11 books on management; see "Charan in Print"). GE's Conaty jokes that while his company has extremely high expectations of its employees, "we do allow people to get married. We do allow them to have kids. We actually allow them to live in homes - even multiple homes, once they make some money with us - and we do allow them vacations and most of their weekends off."

Charan, however, has no discernible personal life. One longtime collaborator has dinner with him whenever Charan is in town. Charan's friend's wife used to join them but stopped. "My wife got to the point where she couldn't stand it anymore, because Charan could not get out of talking about business." Does Charan ever laugh? "Probably," says someone who has spent hundreds of hours with him, "but I can't remember. I pull back from my own appreciation of irony in his presence."

Charan had triple-bypass heart surgery in 1999. After the operation he took it easy for 11 days, then went back to work. He couldn't fly for a while but that was fine - he loves trains. Most of his clients never knew he was sick. Welch, who has had his own bypass surgery, did know, and worried. "Ram, what the hell are you doing here?" he said when he saw him soon afterward. Charan, though pale, was dismissive. By then he had already been to Europe and back once.

"He isn't doing anything"

Generalizing about what Charan does for his clients is tricky, but that lack of definition paradoxically is at the heart of his success. His method is no method. He is wary of abstraction and belongs to no school of management theory. "Converting highfalutin ideas to the specifics of the company and the leader - that's the trick," he once confided to me in an elevator. "The other part is working backward to define what the need is, and then searching for what helps. Then you bring it to common sense, and common sense is very uncommon."
That means no ready-made solutions. Instead, Charan brings observation, curiosity, and care. He lets his clients decide how to use him. Sometimes all he does is ask the right question. "I remember the first time he came to see me," says Caperton. "We were driving to the airport in Charleston, W.Va., and he said to me, 'Why are you trying to grow this thing so fast?' I was sort of shocked by the question. Three weeks later my financial guy came to me and said, 'We don't have money to meet payroll.' Charan realized we were growing too fast, that's why he asked me that question. That was a much better way to teach me, wasn't it?"
Or he might teach others which questions to ask themselves. Nick Taubman and Garnett Smith heard Charan speak at a YPO event in 1978. Advance Auto Parts (Charts, Fortune 500) was not a big company at the time - fewer than 200 outlets, less than $200 million in sales - but Taubman, the president, and Smith, his operations guy, had big plans. As the company grew, Charan was always reminding them not to lose touch with the stores. ("You just can't allow this to happen!")

At Charan's suggestion they began hosting regular Tuesday meetings at headquarters in Greensboro, N.C. They'd fly in a handful of store managers from all over the country, put them in a room with the leaders from corporate, and run down a three-item agenda following a script devised by Charan: What unique thing happened in your store last week? What issues did you face that kept you from serving your customers better? How can we fix those issues right now? Says Smith: "He made sure as we grew that we didn't lose sight of what was really important."
When Bill Conaty moved to GE headquarters as senior VP for corporate human resources in 1993, he picked Charan to lead his new-leader assimilation program. Charan brought two dozen of Conaty's new reports to GE's guesthouse for six hours, asking them, What do you know about Bill? What do you want him to know about you? What advice do you have for him? Charan summarized the feedback for Conaty, then offered some of his own, then followed up repeatedly. "Charan really pushed me on the whole business-partnership piece," Conaty recalls, meaning no more HR initiatives for HR's sake, "and the function as a result is much more credible and visible in GE today than it was."

Ivan Seidenberg says he goes through cycles of change at Verizon, and so engages Charan in different ways. "For a while we were trying to figure out how to reengineer work," he says. "Another time we were looking to design new management programs to have people focus on a different way of thinking about running the business: How do you forge a growth culture, as opposed to one that's been focused on productivity for many years? New-product introduction - I talked to him about that. He always whips out this nice little pen he uses, real thin ink, and he starts drawing diagrams. He constantly is helping to provide depth to issues, not only answers. All of it is useful."
John Reed started working with Charan in 1990, before Citi's merger with Travelers. The stock was languishing, the company was struggling. "I knew what I wanted to do," says Reed, "but I wasn't 100% sure how to get it done. That's a big distinction if you're in business. A lot of consultants come in to tell you what you should be doing. This was not that. This was a question of how best to get it done."

Reed says, "Ram is a catalyst in the real sense of that word. He facilitates things happening but doesn't take part in them himself. And he is an immense source of energy. When you're trying to get large organizations to do things, energy is extremely important. He forces you to tell him what it is you want to do, and he forces you to really be clear in your own mind what those things are and what steps have to be taken. Often it's getting the wrong guy out of a job. But the point is, he starts out by basically forcing you to think with him and be very clear. Then, okay, you notice that he isn't doing anything, he's just forcing you to do it. Then once you've agreed on everything you want to do, he calls you up every ten minutes and asks why haven't you done it yet."

"I am allowed to do what I love to do!"

Feb. 19, President's Day. Not much of a holiday for most Americans; certainly it means nothing to Charan. He spent the day with a client in Hartford, then flew to Cleveland on a connecting flight through Dulles. The planes were late. Charan never complained. When the airline club closed and the tired employees went home, Charan relocated to the gate and dozed in a chair until his flight was called. Now he is standing at the check-in desk at a hotel on a highway somewhere far outside town, waiting patiently for his key. The clock behind the desk reads 1:48 A.M. He asks for a 5:00 A.M. wake-up call.

"I'm a lucky man!" Charan likes to say. "I am allowed to do what I love to do!" While I still don't really understand him, I am beginning to believe him. Surely there are many ways to live fully and be happy on this earth; probably, he has found his own. Of course he knows he can't keep this up forever. One day he'll start slowing down, and then he'll begin to dispose of his money. He has long financed the aspirations of his extended family in India, by paying for their schooling and helping some of them get settled overseas. But that's it, he says. No more money for the family. ("My people are not rich, but they have enough to go on their own.") "It's going to be in India" is all he'll say about his coming serious philanthropy. "It goes a long way, a little amount there. To enable people to accomplish things." But Charan's not there yet; he's not even thinking about slowing down. Even though - and this is breaking news - he is no longer homeless. "I now have an apartment in Texas," he tells me matter-of-factly. To say I am dumbfounded is an understatement. Why now? "I just thought I'd get one," he says. "I was in Istanbul, they're all telling me I got to cut this out. They think it's a big deal for me to have never bought a place. I said hell with it. I got tired of people talking about it." So I ask him when he is moving in. "Maybe never," he says, staring hard. Staring back, I catch a glimmer of something, a ripple that crosses his face. It may have been a smile.