Tom Peters’ Re-Imagine excellence!


The Shareholder Value Myth



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The Shareholder Value Myth

“The notion that corporate law requires directors, executives, and employees to maximize shareholder wealth simply isn’t true. There is no solid legal support for the claim that directors and executives in U.S. public corporations have an enforceable legal duty to maximize shareholder wealth. The idea is fable.” —Lynn Stout, professor of corporate and business law, Cornell Law school, in The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public

“[a corporation] can be formed to conduct or promote any lawful business or purpose” —from Delaware corporate code (no mandate for shareholder primacy), per Lynn Stout, professor of corporate and business law, Cornell Law school, in The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public

  • “On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy. … Your main are your employees, your customers and your products.” —Jack Welch, FT, 0313.09, page 1
  • “I told my board that if they want to get the share price up 50% in 12-18 months, I can do it without raising a sweat. But it will destroy the longterm prospects of the company—and they’ll
  • have to do it without me.”
  • —CEO, large ($10B+) electronic components company
  • Leadership Writ Large: Some Stuff
  • I Think Is Important …
  • MBWA
  • MBWA

Managing By Wandering Around

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“I’m always stopping by our stores— at least 25 a week. I’m also in other places: Home Depot, Whole Foods, Crate & Barrel. I try to be a sponge to pick up as much as I can.” —Howard Schultz Source: Fortune, “Secrets of Greatness”

3K/5M Source: Mark McCormack

3,000 miles for a 5-minute face-to -face meeting

  • Glib But TRUE
  • “Decisions are made by those who show up.”
  • —Aaron Sorkin

Even when times are tight … don’t short change the travel budget!

  • MIA: Origins of Our Financial Chaos …
  • The CEO of a very successful mid-sized bank, in the Midwest, attended a seminar of mine in northern California in the mid-’80s—but I remember the following, pretty much word for word, as if it were yesterday …
  • MIA: Origins of Our Financial Chaos …
  • “Tom, let me tell you the definition of a good lending officer. After church on Sunday, on the way home with his family, he takes a little detour to drive by the factory he just lent money to. Doesn’t go in or any such thing, just drives by and takes
  • a look.”

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  • “Most managers spend a great deal of time thinking about what they plan to do, but relatively little time thinking about what they plan not to do. As a result, they become so caught up … in fighting the fires of the moment that they cannot really attend to the long-term threats and risks facing the organization. So the first soft skill of leadership the hard way is to cultivate the perspective of Marcus Aurelius: avoid busyness, free up your time, stay focused on what really matters. Let me put it bluntly: every leader should routinely keep a substantial portion of his or her time—I would say as much as 50 percent—unscheduled. … Only when you have substantial ‘slop’ in your schedule—unscheduled time—will you have the space to reflect on what you are doing, learn from experience, and recover from your inevitable mistakes. Leaders without such free time end up tackling issues only when there is an immediate or visible problem. Managers’ typical response to my argument about free time is, ‘That’s all well and good, but there are things I have to do.’ Yet we waste so much time in unproductive activity—it takes an enormous effort on the part of the leader to keep free time for the truly important things.”
  • —Dov Frohman (& Robert Howard), Leadership The Hard Way: Why Leadership Can’t Be Taught—
  • And How You Can Learn It Anyway (Chapter 5, “The Soft Skills Of Hard Leadership”)
  • “Most managers spend a great deal of time thinking about what they plan to do, but relatively little time thinking about what they plan not to do. As a result, they become so caught up … in fighting the fires of the moment that they cannot really attend to the long-term threats and risks facing the organization. So the first soft skill of leadership the hard way is to cultivate the perspective of Marcus Aurelius: avoid busyness, free up your time, stay focused on what really matters. Let me put it bluntly: every leader should routinely keep a substantial portion of his or her timeI would say as much as 50 percentunscheduled. … Only when you have substantial ‘slop’ in your schedule—unscheduled time—will you have the space to reflect on what you are doing, learn from experience, and recover from your inevitable mistakes. Leaders without such free time end up tackling issues only when there is an immediate or visible problem. Managers’ typical response to my argument about free time is, ‘That’s all well and good, but there are things I have to do.’ Yet we waste so much time in unproductive activity—it takes an enormous effort on the part of the leader to keep free time for the truly important things.” —Dov Frohman (& Robert Howard), Leadership The Hard Way: Why Leadership Can’t Be Taught—And How You
  • Can Learn It Anyway (Chapter 5, “The Soft Skills Of Hard Leadership”)
  • “The Discipline Of Daydreaming”: “Nearly every major decision of my business career was, to some degree, the result of daydreaming. … To be sure, in every case I had to collect a lot of data, do detailed analysis, and make a data-based argument to convince superiors, colleagues and business partners. But that all came later. In the beginning, there was the daydream. By daydreaming, I mean loose, unstructured thinking with no particular goal in mind. … In fact, I think daydreaming is a distinctive mode of cognition especially well suited to the complex, ‘fuzzy’ problems that characterize a more turbulent business environment. … Daydreaming is an effective way of coping with complexity. When a problem has a high degree of complexity, the level of detail can be overwhelming. The more one focuses on the details, the more one risks being lost in them. … Every child knows how to daydream. But many, perhaps most, lose the capacity as they grow up. …” —Dov Frohman (& Robert Howard), Leadership The Hard Way:
  • Why Leadership Can’t Be Taught—And How You Can Learn It Anyway
  • (Chapter 5, “The Soft Skills Of Hard Leadership”)



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