Good to Great

How does the emphasis on people first fit with all the management teachings about

corporate vision, purpose, mission and strategic thinking?

Traditional management teachings tend to push developing "the plan" Ð'- a roadmap of where the company wanted to get to through a purpose, mission, vision and strategic thinking. Getting the right people, as well as refusing to accept anything less than the best people to take the most appropriate roles in the organization, frequently took a backseat in the development of an organization. While even the best companies might find it necessary to conduct layoffs, the manner of how the layoff is done might be considered as evidence as to whether a company might be, if not great, at least good.

Placing the emphasis on people first in regards to the management teachings of vision, purpose, mission and strategic thinking does not and should not have to be at cross-purposes with each other. Incorporating and embedding the concept of the right people into every aspect of managing and leading an organization can be done, but it requires a level of discipline that I suspect few organizations have.

How can you ask questions that lead people to find the truth for themselves rather than to give you the predetermined answer you want?

Asking the right questions in the right way and at the right time is not always a simple task, but at the risk of over-simplifying this, I believe the answer is to ask open-ended questions that ask the heart of the question. For example, let's imagine a company that has several distinct business lines, one of which is doing poorly and negatively affecting the results of the company. A typical manager might initially ask "how can we improve this business line?" while a leader might ask "who are the people who know the most about this business line?" The questions need to be open-ended "why" questions, not leading "wouldn't you agree" questions. Beyond that, those answering the questions need to know that they will not suffer reprisals for voicing answers that might prove to be unpopular; instead, the questions should allow for open debate and seek a more in-depth understanding of the issues.

How does the hedgehog differ from the fox in the way it addresses the complexities in the world?

Regardless of whether discussing a single individual or an organizational unit, hedgehogs are those who seek to find the basic element that defines their own essential world. In terms of a basic element, this can be a concept or a principle, what helps drive and define the core elements for the hedgehog. In terms of "essential world", I refer to the perceived world and reality for the hedgehog.

Foxes might seek the answer to the very same complex questions as hedgehogs, but foxes tend to fail in developing a viable solution to these questions because foxes are not focused on a single complex question, but divert their resources across a multitude of questions or challenges. Neither hedgehogs nor foxes are necessarily more intelligent than the other.

In terms of business, it means driving the business towards the single area of enterprise that the company has the potential be best succeed in, rather than attempting to succeed in a multitude of disparate endeavors. This does not imply that a hedgehog business can only have a single specific product; rather, it implies that a hedgehog business will focus on a single general area of products, services or an area of excellence. A steel mill may only offer steel products, but it may formulate different types of steel, and shape those different steel metals into different products, but at the core, it still is steel.

A good example of a company putting the hedgehog concept into practice is Walgreen's, who divested themselves from the restaurant business and focused strictly on the ever-expanding pharmacy chain. The restaurants were not essential to the future success of the company, whereas the pharmacy chain was essential. Hedgehogs basically cut to the chase, eliminating what isn't necessary for them, and focus on being the best in their area of expertise.

How can the budgeting process be used to maintain a focus on a company's Hedgehog

Concept?

Once a company has an identified Hedgehog Concept, each and every activity that requires resources of any sort Ð'- money, time, staff, etc. Ð'- needs to be evaluated in terms of the company's Hedgehog Concept. Activities and projects that have no relation and provide no support to what the company can do best simply should not be funded, while activities that support what the company can do best should be funded.