What the Best CEOs Know : 7 Exceptional Leaders and Their Lessons for Transforming any Business

257 Pages·2003·2.44 MB·English

by  Jeffrey Krames

9715_Krames_fm.qxd 2/24/03 12:27 PM Page i
WHAT the
BEST
CEOs
KNOW
7 Exceptional Leaders and
Their Lessons for Transforming
any Business
JEFFREY A. KRAMES
McGraw-Hill
New York St. Louis San Francisco Washington, D.C. Auckland
Bogotá Caracas Lisbon London Madrid Mexico City
Milan Montreal New Delhi San Juan Singapore
Sydney Tokyo Toronto
ebook_copyright 6x9.qxd 5/15/03 2:02 PM Page 1
Copyright © 2003 by The McGraw-HIll Companies, Inc. All rights reserved. Manufactured in the
United States of America. Except as permitted under the United States Copyright Act of 1976, no part
of this publication may be reproduced or distributed in any form or by any means, or stored in a data-
base or retrieval system, without the prior written permission of the publisher.
0-07-142907-7
The material in this eBook also appears in the print version of this title: 0-07-138240-2.
All trademarks are trademarks of their respective owners. Rather than put a trademark symbol after
every occurrence of a trademarked name, we use names in an editorial fashion only, and to the benefit
of the trademark owner, with no intention of infringement of the trademark. Where such designations
appear in this book, they have been printed with initial caps.
McGraw-Hill eBooks are available at special quantity discounts to use as premiums and sales pro-
motions, or for use in corporate training programs. For more information, please contact George
Hoare, Special Sales, at [email protected] or [phone].
TERMSOFUSE
This is a copyrighted work and The McGraw-Hill Companies, Inc. (“McGraw-Hill”) and its licensors
reserve all rights in and to the work. Use of this work is subject to these terms. Except as permitted
under the Copyright Act of 1976 and the right to store and retrieve one copy of the work, you may not
decompile, disassemble, reverse engineer, reproduce, modify, create derivative works based upon,
transmit, distribute, disseminate, sell, publish or sublicense the work or any part of it without
McGraw-Hill’s prior consent. You may use the work for your own noncommercial and personal use;
any other use of the work is strictly prohibited. Your right to use the work may be terminated if you
fail to comply with these terms.
THE WORK IS PROVIDED “AS IS”. McGRAW-HILLAND ITS LICENSORS MAKE NO GUAR-
ANTEES OR WARRANTIES AS TO THE ACCURACY, ADEQUACYOR COMPLETENESS OF
OR RESULTS TO BE OBTAINED FROM USING THE WORK, INCLUDING ANYINFORMA-
TION THATCAN BE ACCESSED THROUGH THE WORK VIAHYPERLINK OR OTHERWISE,
AND EXPRESSLYDISCLAIM ANYWARRANTY, EXPRESS OR IMPLIED, INCLUDING BUT
NOTLIMITED TO IMPLIED WARRANTIES OF MERCHANTABILITYOR FITNESS FOR A
PARTICULAR PURPOSE. McGraw-Hill and its licensors do not warrant or guarantee that the func-
tions contained in the work will meet your requirements or that its operation will be uninterrupted or
error free. Neither McGraw-Hill nor its licensors shall be liable to you or anyone else for any inac-
curacy, error or omission, regardless of cause, in the work or for any damages resulting therefrom.
McGraw-Hill has no responsibility for the content of any information accessed through the work.
Under no circumstances shall McGraw-Hill and/or its licensors be liable for any indirect, incidental,
special, punitive, consequential or similar damages that result from the use of or inability to use the
work, even if any of them has been advised of the possibility of such damages. This limitation of lia-
bility shall apply to any claim or cause whatsoever whether such claim or cause arises in contract, tort
or otherwise.
DOI: 10.1036/0071429077
9715_Krames_fm.qxd 2/24/03 12:27 PM Page iii
To my parents, who turned a small apartment in the
Bronx into a learning organization of their own
And to my incredible wife, for her unending
patience and encouragement. An author,
and husband, has never had a better partner.
This page intentionally left blank.
9715_Krames_fm.qxd 2/24/03 12:27 PM Page v
For more information about this title, click here.
CONTENTS
The Era of the CEO? 1
PART 1: What Made Them Great 17
CHAPTER 1: The Exceptional Seven and the Traits
That Defined Them 19
PART 2: Defining Strategies of Exceptional Leaders 53
CHAPTER 2: Place the Customer at the Epicenter
of the Business Model 55
Michael Dell and the Art of the Customer
CHAPTER 3: Create an Authentic Learning Organization 79
How Jack Welch Converts Learning into Results
CHAPTER 4: Focus on Solutions 107
Lou Gerstner on Creating a Customer-Obsessed IBM
CHAPTER 5: Prepare the Organization for Drastic
Change 131
Andy Grove on Strategic Inflection Points
CHAPTER 6: Harness the Intellect of Every Employee 153
Bill Gates on Creating a Knowledge-Based
Organization
v
Copyright 2003 by The McGraw-Hill Companies, Inc. Click Here for Terms of Use.
9715_Krames_fm.qxd 2/24/03 12:27 PM Page vi
Contents
CHAPTER 7: Create a Performance-Driven Culture 173
Herb Kelleher on the Importance of Creating
a Family-Like Culture
CHAPTER 8: Learn from Competitors, but Remain
Faithful to the Vision 197
How Sam Walton’s Vision Created the World’s
Largest Company
Acknowledgments 221
Notes/Sources 225
Index 241
vi
9715_Krames_itr.qxd 2/24/03 12:27 PM Page 1
The Era of the CEO?
Copyright 2003 by The McGraw-Hill Companies, Inc. Click Here for Terms of Use.
This page intentionally left blank.
9715_Krames_itr.qxd 2/24/03 12:27 PM Page 3
T
he late 1990s and early 2000s brought seismic changes
to corporate America and U.S. financial markets—
changes that shook our collective confidence in several of
our most important institutions.
Since much of the work that went into this book took
place in that tumultuous period, the events that played out
during those years (roughly 1998 through mid-2002) had a
substantial impact on the shape and content of the book.
What started out as a straightforward task of chronicling
the business tactics and methods of a small group of suc-
cessful CEOs became a far more complex challenge.
When I began writing this book, the business environ-
ment could not have looked much better. In the late 1990s,
the U.S. stock markets were riding high, having enjoyed al-
most two decades of unprecedented and nearly uninter-
rupted growth. The Dow Jones Industrial Average, which
at the start of the bull market in 1982 had hovered at
around 800, had broken through both the 10,000- and
11,000-point psychological barriers. (Pundits were then
prognosticating about the Dow soaring to 30,000 in the
not-too-distant future!) The tech-heavy NASDAQ Index,
meanwhile, was on an even more breathtaking ride up to
the 5000-point level. In a display of hubris that seems
quaint in retrospect, the NASDAQ had begun calling itself
the stock exchange of the next century.
This upsurge in market valuations had profound effects
on the investing public—the base of which had also grown
enormously as defined-contribution retirement plans re-
placed defined-benefit plans. (Several decades ago, only a
small percentage of Americans owned individual stocks or
3