Vanguard Mutual Funds: Everyone
spends one day per quarter
on the customer support telephone
lines. Again, customer
service is the top value.
Starbucks: Everyone gets a 24-
hour intensive course in coffee
and customer experience and
then serves as a barista for over
one week. The strategy focuses
on producing an uplifting experience.
JetBlue: Flight reservations agents
spend a week in training and
then work flex hours from home.
They go on-line to trade for the
shift they want. The strategy focuses
on convenience.
RBS: The Chief Executive meets
his executive team each morning
at 8 AM for one hour to go over
the previous day, the day's
agenda, and the future (no more
than 90 days). Speed is the essence
of RBS.
W L Gore: All associates work in
one of 15 functional areas, identify
a sponsor and make and fulfill
promises to the sponsor.
There are no job descriptions, annual
objectives, just promises.
Commitment is the highest value.
Goldman Sachs: Successful job
candidates go through 60 pre-hire
Interviews. Collaboration and
networking are top values.
Digicel: All regional marketing
and sales heads attend the "Why
should the customer marry us
this week?" meeting for reviewing
products, services, and promotions.
The meeting does not end
until there is a convincing weekly
reason for the marriage. Digicel
prides itself in its innovative care
for customers.
Whole Foods Market: New hires
join an entrepreneurial department
such as groceries, meats, or
vegetables on probation for four
weeks. After four weeks the new
hire must receive a two-thirds
vote to keep the job. Whole Foods
runs on the basis of small, decentralized
entrepreneurial teams.
Umpqua Bank: Motivational moments
take place every morning
before the bank opens. Each manager
has his or her team go
through a different uplifting exercise.
Umpqua's strategy is to be
the most interesting retailer in
town.
If a leader does not already have a
signature practice ready-made to go
with the strategy, we advise that the
leader identify how the strategy
changes promises to customers,
shareholders, or direct reports.
Identify one key practice that
expresses the key changed promise
clearly and redesign the practice so
that as many people in the company
as possible engage in it. Signature
practices are critical for
communicating the new strategy by
communicating its chief value in a
visceral way (Tamara Erickson and
Lynda Gratton have written
brilliantly about signature practices
in their March 2007 HBR article
"What It Means to Work Here").
What is the role of culture in
implementing strategies successfully?
Promise-based strategy execution
understands that even seemingly
simple strategy shifts, for instance,
deploying a technology upgrade to
build a new level of efficiency,
require cultural shifts. For that
reason, promise-based strategic
execution deals directly with
changing the company's culture
precisely where the culture lives
and most resists change: in the
habits, familiarity, and tacit common
sense of people in the organization.
That is why promise-based strategy
execution begins with mapping the
current recurrent promises. Once it
has this map, it draws together
designers and people in the trenches
to design the new network of
recurrent promises. The key part of
strategy execution is training people
in new promises that force new
behavior, new assumptions, the
development of new tacit knowhow,
and new relationships. In
order to make the habit change stick,
promise-based strategy execution
focuses intensely on one promise
cluster at a time.
Researchers have come to see that
culture can become a competitive
advantage. In the US, strategists
have known that Nordstrom's,
Disney's, Ritz Carlton's, Apple's,
Harley Davidson's, and Southwest
Airline's cultures were competitive
advantages in themselves. In the
UK, strategists knew that Virgin's,
John Lewis', and the Body Shop's
culture had the same power over
customers, employees, and
shareholders. Such companies with
vibrant, attractive cultures have rates
of return on investment 1.7 times
those of Jim Collins's great
companies and 3 times the average
Fortune 500 company. They boast
extremely high employee retention
rates, and because of effective word
of mouth, they get more bang from
their marketing spend.
But these cultures typically seem to
be extensions of the founder's
personality, almost a matter of luck.
In working with bold, imaginative,
idealistic Chief Executives, we have
uncovered six factors of outstanding
importance for developing a
competitive culture. Since these
factors are close to elements of
promise-based management, they
can be easily and effectively
integrated into strategy execution.
