800-CEO-READ Blog

Jack Covert Selects - The Wal-Mart Decade

The Wal-Mart Decade: How a New Generation of Leaders Turned Sam Walton’s Legacy into the World’s #1 Company by Robert Slater, Portfolio, 227 Pages, $25.95 Hardcover, June 2003, ISBN 1591840066

Detailing the history of Wal-Mart to its current status, The Wal-Mart Decade actually spans more than a decade’s time. Robert Slater takes the reader back to the very start of Sam Walton’s first retailing days in the 1960s as a Ben Franklin franchise owner whose success quickly brought him to own 16 of the stores in 3 states. Walton championed the idea of selling more items at an everyday low discount price to make more profit. His modest and humble, but aggressive business tactics escalated him to being the leader of the world’s largest retailer: Wal-Mart. Walton was so involved in the company, its creation, its maintenance, that after he died in 1992, many doubted whether Wal-Mart could survive. However, the corporate culture Walton left behind was so rock solid that it has kept the company together, and made it bigger and stronger than ever.

Slater details the components of Walton’s winning culture structure and shows how the company’s executives have stayed true to it, thus making the company the retail giant of the world. Walton’s successors had no desire to replicate Sam Walton—they just wanted to continue his vision and values. CEO David Glass was able to take Walton’s vision further by taking more risks and working to expand the company into new foreign markets. He combined the Walton vision with his own global vision, and Wal-Mart doubled its income in four years.

Despite many public relations challenges involving the media, the government, and lawsuits, Wal-Mart has stayed on top by learning to be flexible and yielding to change where change was needed.

The Wal-Mart Decade is a fascinating read that teaches many leadership lessons through the story of its main “characters.” Seeing how the big executives at the top of the organization make decisions by not losing sight of the people on all other levels of the company teaches a great deal about modern corporate leadership, integrity, and responsibility.

Jack Covert Selects - Why Smart Executives Fail

Why Smart Executives Fail: And What You Can Learn from Their Mistakes by Sydney Finkelstein, Portfolio, 318 Pages, $26.95 Hardcover, June 2003, ISBN 1591840104

When we hear of a giant business failure, we think the executives must have been stupid, didn’t know what was coming, didn’t try hard enough, had bad leadership skills, or were just plain crooks. Finkelstein, a professor at Dartmouth’s Tuck School of Business, says that most of the time, none of the above are the reasons behind the disaster. In fact, CEOs are very smart and usually top experts in their fields—otherwise they couldn’t have become CEOs in the first place, right? So, this leaves an incongruity. Why do companies with skilled executives fail? Finkelstein has conducted one of the largest (if not the largest) studies on why businesses break down, and supplied answers for us in this new book.

The book is broken down into three parts, the first of which gives detailed accounts of how different companies failed in four different areas or stages: new business ventures, change initiatives, mergers, and strategic planning. After each example, the author points out what the executives’ mistakes were, what circumstances affected them, and what they maybe could have done differently. I really enjoyed reading about Webvan, Saatchi & Saatchi, and the Red Sox. In the second part, Finkelstein gives four reasons for executive failure like fulfilling the wrong vision, refusing to look at or accept reality, failing to act when necessary, and having bad habits or personality traits. The last part of the book shows us how we can learn from the mistakes of the CEOs in the book so hopefully we won’t end up as a sample case in the revised edition!

I liked this book for it’s far-reaching range of businesses and personalities. Also, the author doesn’t spend way too much time on any one example—he gets straight to the point. I think Why Smart Executives Fail is an important book, especially in the context of the latest news involving Martha Stewart.

Jack Covert Selects - Absolute Honesty

Absolute Honesty: Building a Corporate Culture that Values Straight Talk and Rewards Integrity by Larry Johnson & Bob Phillips, AMACOM, 290 Pages, $27.95 Hardcover, June 2003, ISBN 0814407811

I love books that are absolutely perfect for the time. When you consider that is takes a year for a book to make it through the book “food chain,” this book is remarkably timed. We all have heard of all the nightmares like Enron, WorldCom, Tyco, Martha Stewart, Adelphia. This is the book that we need to read to create the culture that could/should help us to avoid these issues.

The layout of the book is very helpful. The first two chapters are loaded with examples that precisely illustrate what a culture of absolute honesty is like and how to create one. The authors then explain the Six Laws of Absolute Honesty: Tell the Truth, Tackle the Problem, Disagree and Commit, Welcome the Truth, Reward the Messenger, Build a Platform of Integrity. Part 2 of the book deals in depth with the six rules. Of course, the rules are illustrated with tons of stories and examples that support the author’s premise. The final part is called Where Do We Go from Here? Example after example of how to implement the six rules and create the culture are in this part of the book.

The book isn’t merely arguing for more honesty in the workplace, it’s promoting the idea of open debate and discussion, and trust. Who doesn’t need that? Authors Johnson and Phillips have written a very useful book that shows how to free-up any work environment with honest and open communication.

Jack Covert Selects - It's Alive

It’s Alive: The Coming Convergence of Information, Biology, and Business by Christopher Meyer and Stan Davis, Crown Business, 263 Pages, $27.50 Hardcover, May 2003, ISBN 1400046416

Meyer and Davis, the authors of the bestseller Blur from a couple years back, have a new book with a new concept for another new type of economy: the molecular economy. I admit, I was very intimidated and cynical of all this science stuff, but once I started reading, I found it wasn’t that difficult to understand at all. It makes a lot of sense!

The authors say that in the next ten years, our world will again change drastically—it’s already begun. Management trends are shifting towards trying to sense change in order to respond to it (“adaptive management”). Also, the industry of molecular technologies is growing, and the authors think it will become an economic force equal in scale to the information economy. Then, the two fields will merge; science borrowing information tools from business, business borrowing adaptation principles from science. After this, the fields will be almost inseparable, with business and information moving in tandem with the science fields, all of them together acting like one living organism.

The science jargon is heavy at times, but the authors do everything they can to simplify it for their readers. Also, the book has many present-day, real-world examples that show what they are talking about. And there are graphs and tables throughout that help, too. Plus, they provide a glossary in back.

Read this book and be in on the next big thing—which reminds me of a related book also published by Crown, called The Next Big Thing Is Really Small: How Nanotechnology Will Change the Future of Your Business.

Jack Covert Selects - Code Name Ginger

Code Name Ginger: The Story Behind Segway and Dean Kamen’s Quest to Invent a New World by Steve Kemper, Harvard Business School Press, 290 Pages, $27.95 Hardcover, June 2003, ISBN 1578516730

I remember those many years ago when I first heard about this “change the world” product that was being developed. Heavyweights like Jeff Bezos and Steve Jobs were saying that the world would never be the same once this secret was released. Code Name Ginger is the really inside story of the development of that secret—“Ginger,” which ended up being called “Segway Human Transporter.” The machine is a fascinating idea that is like a scooter on steroids. The Segway reacts to your desires by sensing what you want it to do by using an elaborate system of gyros. Lean forward, it goes forward. Imagine the design process for this machine—way out-of-the-box stuff!

Author Steve Kemper followed the development of the Segway from the beginning. He was given unrestricted access the all the design meetings, all the money meetings, everything. As a reader, you are absolutely a fly on the wall. You listen and watch the venture capital guys trying to give the developers more money just to increase their shares of the company even more. Everybody wanted in on this thing.

After being sucked into the whirlwind and excitement of the development of the Segway, I found myself saying: wait a minute. Where is the practical application to this machine? Yes, the cities are over-crowded and public transportation is a mess. Yes, it would be great to have a $2k (now $5k, by the way) machine that would move people and doesn’t emit bad things into the atmosphere, but let’s get serious. Wouldn’t it be nice to at least have a basket to carry your groceries in on the way home? Which leads us to Ginger’s heartbreaking fizzle in the marketplace.

This is an extremely well written narrative about an extremely fascinating subject, an extremely fascinating group of people, which fail spectacularly. More than just a story, the book delivers important lessons about everything in business from the dream to financing, marketing to entrepreneurship, and buzz to flop. A fun summer read!