ue DrivenLeaders are legendary for walking plant floors (MBWA), visiting stores to assess them, and being highly visible. Employees know what their company stands for, and what they can view with pride years down the road. The excellent companies had a well-defined set of guiding beliefs, and stayed close to those beliefs. The annual reports of these companies make clear what their values are. Dominant beliefs include importance of people as individuals, belief in superior quality and service, innovation, and informality.Stick to the KnittingThe companies studied in the book believe that you should never acquire a business you don't know how to run, but stay close to the business you know. Related diversification pays off best, as unrelated diversification is frequently not profitable. Virtually all growth has been internally generated for these companies. They do acquire, but only in small increments, and are willing to get out if it doesn't work.Simple Form, Lean StaffLean top-level staffs are the norm for these performers. It was not unusual to run a huge enterprise with a staff of fewer than 100 people. Product divisions are treated as separate companies. They have shown that hands-on management works better with less middle management. A difference in philosophy between Japan and US is shown by the fact that US management tends to believe that no one can control more than 5-7 people. One bank in Japan has several hundred managers reporting to one person. When the form is simple, a company can survive with a smaller staff.Simultaneous Loose-Tight Properties Excellent companies are simultaneously centralized and decentralized; a firm central direction and individual autonomy. Excellent companies are devoted core values, and within those values, they allow much experimenting. They are at once rigidly controlled and yet encourage innovation. Attention to the customer is the most strictly adhered to property. The companies may seem s...
