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Overview
The toughest job in business is taking over as a new leader. You have to quickly assess the situation, pull together a strong team, decide on a strategy, and inspire everyone to execute it.
The stakes for new leaders are even higher. Whether you've been brought on to fix something that's broken, launch a product, move the company in a new direction, or head up a division, every new leader is under the gun to get up to speed and begin producing strong numbers? ASAP.
In Hit the Ground Running, Jason Jennings introduces us to America's best performing new CEOs who pulled off the most impressive transformations of the decade. They doubled revenues, more than tripled earnings per share, and doubled their company's net profit margins.
After interviewing and analyzing the stories of these top leaders, Jennings delivers their hard- earned, battle-tested strategies, which will inspire any new leader to take the helm and start delivering.
When Richard and Tim Smucker were appointed co-CEOs of The J. M. Smucker Company, they shared their strategy with everyone and got them on board with their mission. Since then, Smucker's went on to dominate the markets and bring in billions of dollars of new business.
Mike McCallister, the CEO of a twenty-billion-dollar health-services giant, decided to stop pretending and publicly admit that health insurance is broken. Humana began to replace a crippled, complex, and confusing system with one that works and has more than tripled revenues, earnings, and share price since McCallister took over.
By processing change in bite-size pieces, Jeffrey Lorberbaum led Mohawk Industries through twenty successful acquisitions and turned his family's carpet-making business into the largest flooring company in the world.
Filled with engaging stories and lessons from the cream of the crop, Hit the Ground Running will help new leaders at every level balance short- and long-term goals as well as the needs of shareholders, employees, customers, and the community.
Product Details
| ISBN-13: | 9781101024553 |
|---|---|
| Publisher: | Penguin Publishing Group |
| Publication date: | 03/19/2009 |
| Sold by: | Penguin Group |
| Format: | eBook |
| Pages: | 256 |
| File size: | 349 KB |
| Age Range: | 18 Years |
About the Author
Read an Excerpt
Table of Contents
Title Page
Copyright Page
Dedication
Introduction
Rule 1: Don’t Deceive Yourself—You Will Reap What You Sow
Rule 2: Gain Belief
Rule 3: Ask for Help
Rule 4: Find, Keep, and Grow the Right People
Rule 5: See Through the Fog
Rule 6: Drive a Stake in the Ground
Rule 7: Simplify Everything
Rule 8: Be Accountable
Rule 9: Cultivate a Fierce Sense of Urgency
Rule 10: Be a Fish Out of Water
120 Quotes from America’s Best-Performing CEOs
Acknowledgements
The Research
Index
Advance Praise for Hit the Ground Running
“I read Hit the Ground Running from cover to cover. It is a great read
and one of the most interesting and useful business books I have
ever read.”
—Jim Goodnight, CEO, SAS Institute
first when they provide value-centered leadership that places the
needs of customers, employees, and shareholders before the needs—
or ego—of the CEO. A great read for any aspiring leader.”
—Kevin L. Robert, CEO, Wolters Kluwer Tax and Accounting
new CEOs. The result is a list of rules any leader—new or
seasoned—can live by.”
—Mike Koehler, president and CEO, Teradata Corporation
me of my favorite Bible verse about business, ‘The reward of humility
and the fear of the Lord are riches, honor, and life.’ ”
—Larry P. Ferguson, chairman and CEO, Schreiber Foods
ALSO BY JASON JENNINGS
BUSINESS AND LEADERSHIP
Think Big, Act Small: How America’s Best Performing Companies Keep the Start-up Spirit Alive
Less Is More: How Great Companies Use Productivity as a Competitive Tool in Business
It’s Not the Big That Eat the Small . . . It’s the Fast That Eat the Slow: How to Use Speed as a Competitive Tool in Business
(coauthored with Laurence Haughton)
SELF-HELP
BREATHE! Heal Your Heart in 15 Minutes a Day
(coauthored with Dr. John Kennedy)
PORTFOLIO
Published by the Penguin Group
Penguin Group (USA) Inc., 375 Hudson Street, New York, New York 10014, U.S.A.
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Canada M4P 2Y3 (a division of Pearson Penguin Canada Inc.)
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Johannesburg 2196, South Africa
Penguin Books Ltd, Registered Offices: 80 Strand, London WC2R 0RL, England
First published in 2009 by Portfolio, a member of Penguin Group (USA) Inc.
Copyright © Jason Jennings, 2009
All rights reserved
LIBRARY OF CONGRESS CATALOGING IN PUBLICATION DATA Jennings, Jason.
Hit the ground running : a manual for new leaders / by Jason Jennings. p. cm.
Includes index.
eISBN : 978-1-101-02455-3
1. Leadership. 2. Executive ability. 3. Success in business. I. Title.
HD57.7.J468 2009
658.4’092—dc22 2008045302
Without limiting the rights under copyright reserved above, no part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form or by any means (electronic, mechanical, photocopying, recording or otherwise), without the prior written permission of both the copyright owner and the above publisher of this book.
The scanning, uploading, and distribution of this book via the Internet or via any other means without the permission of the publisher is illegal and punishable by law. Please purchase only authorized electronic editions and do not participate in or encourage electronic piracy of copyrightable materials. Your support of the author’s rights is appreciated.
This book is dedicated to George Staubli
Introduction
Every manager or leader needs to hit the ground running!
When you’re given the opportunity to take charge and you get it right, you put yourself on your leadership’s radar. Do it right a second time and you’ll become known as a go-to manager who can be trusted to deliver results.
But if you don’t get it right, you’ll join a long list of question marks at your company. Sure you may get another chance, if the “A” list is unavailable or nobody else wants the assignment. But fail to get it right a second time and you’ll get yourself on that other executive radar system—the one that warns boards and bosses that they’re making a risky bet when they choose you. Who’s willing to hire, promote, take a chance on, and trust someone with a big question mark written on his back? (And who’s motivated to work for him?)
The stakes for executives are now higher than ever. Movers are getting a lot less time to become shakers. On average, upper managers get just about three years to work their magic. Then they either move on or move out.
So whether you’re starting a new career, launching a new product, or positioning yourself to take on bigger responsibilities, it’s imperative that you know how to get up to speed, make good decisions quickly, and begin producing positive results fast.
The big question is, “What are the right steps to ensure that you will hit the ground running?”
You Need a Front-Row Seat
It would be great if organizations had a manual for their new leaders, a collection of dos and don’ts learned the hard way—through trial and error in the real world of day-to-day business at your company.
But I’ll bet you’ve never seen one. Few of us have. Ninety-three percent of executives admit their company doesn’t keep any reliable record of the steps that led to their best or worst management decisions. So there’s little practical wisdom to follow. Memories are unreliable. People count their hits and routinely forget their misses. Academics may have interesting findings and insight, but their advice is generally not battle-tested. That leaves most of us condemned to make many of the same mistakes as previous generations and learn only from our own experiences as we go up the chain of command.
I recall an argument I had with my father when I was a teenager and being as obnoxious as only sixteen-year-old boys can be. Finally, in utter exasperation, my father looked at me and very calmly said, “Son, it’s a wise man that learns from his experiences but a far wiser man who learns from the experiences of others as well.” That’s especially true if you want to hit the ground running.
The promise of this book is that you’ll learn the tactics, strategies, values, and guiding principles of the best CEOs—each with a proven record of successfully taking charge and getting their companies on track to outperform all others. How much is that worth?
One of the CEOs in the book repeatedly expressed his gratitude for having had front-row seats twice during his career and being able to watch masterful CEOs do their job. Another was equally grateful for the time he spent seeing bad tactics lead to bad results. It gave him a great list of what not to do.
The things you’ll learn in the following pages are the equivalent of you having those same front-row seats and watching and learning from the best in the world.
The Role Models
You’re about to meet America’s best performing CEOs.
They are the best CEOs in the nation because during the time period studied they created more economic value for their companies and shareholders than all the other CEOs of America’s top one thousand companies.
Each CEO distinguished himself by quickly sizing up the situation, stopping any bleeding, seeing through the fog, selecting a destination, assembling the right team, building a strategy, and rapidly achieving great results. They all hit the ground running.
Our research travels took us from the industrial countryside of Georgia to specialty steel plants to office superstores. We hung out with natural gas exploration crews on the sun-blasted deserts of Utah, got stuck in New England blizzards, managed a sneak peak at futuristic aerospace technology, and played with the latest battlefield communications gear.
As we pored through the thousands of pages of transcripts trying to connect the dots we came to three realizations:
• All the CEOs we identified got their companies moving in the right direction really fast. They didn’t wait for consultants to report or dawdle indecisively for an eternity before making the first move. Their instincts were terrific; they came prepared with outstanding new ideas and were able to get people pitching in immediately.
• Each CEO was guided by a set of rules for taking charge that challenges conventional thinking. They didn’t automatically replace existing staff or bring in their cronies. They didn’t put the fear of God into everyone. They didn’t spin or make any “the ends justify the means” rationalizations. Their rules were very different from what we’ve been told are the practices of the hardest-charging, highest-performing CEOs.
• Most important, each CEO made everyone proud. What these new CEOs did and the way they went about it was right for investors, right for employees, right for their communities, right for the short run, and right for the long run. It made people proud and that created a lot of momentum.
Collectively these CEOs confronted every imaginable business challenge and problem, and we were blown away by their remarkable insights, their authenticity, their calm sense of peace and certainty, and their willingness to share everything they’d learned throughout their life and business journeys.
In short, these new leaders gave us what can fairly be called the golden rules for hitting the ground running.
Here’s How We Found Them
We studied the performance of all the CEOs who’d taken charge of the thousand largest publicly traded companies in the United States. Collectively these companies generate more than $12 trillion in annual revenues and account for more than 80 percent of the total economic activity generated by all 11,000 public companies in the nation.
We didn’t include any privately held companies because they’re notorious for holding their financial cards close to their vests. We also didn’t investigate any leader’s performance prior to 2001 because the world has changed since the end of the twentieth century in so many ways, including the Sarbanes-Oxley Act, which requires the CEOs of all publicly traded companies to personally attest to the accuracy of their financial reporting.
There were three other standards in our search: The CEOs had to have been on the job for at least three years; the companies had to be clean; and the CEO had to still be on the job. It can sometimes take a few years to implement change and realize its full financial impact; we didn’t want to write about companies that dump toxic waste in people’s backyards; and, if the CEO had left the company, he’d probably be unwilling or unable to talk openly about his time in charge.
The best way to measure the performance of a CEO and compare one to another is to calculate the total amount of economic value they’ve created. We defined economic value as the sum of the profits generated, dividends paid, increases in sales and profits, and the increase in the company’s share price during the CEO’s tenure.
Between 2001 and 2007 the average Fortune 1000 CEO who’d been on the job at least three years and was still in the chair managed to increase his company’s revenues by 55 percent, earnings per share by 68 percent, EBITDA (earnings before interest, taxes, depreciation, and amortization) by 164 percent and net profit margins by 5 percent.
The CEOs who made our cut include people who took over companies because of death, retirement, resignation, or the poor performance of their predecessor, and each far outperformed the average CEO performance. The CEOs we identified almost doubled revenues, more than tripled earnings per share, nearly tripled EBITDA, and doubled their company’s net profit margins.
The Nation’s Best Performing CEOs 2001-2007
• Patrick Hassey ended a streak of ten consecutive money-losing quarters after he took over troubled Allegheny Technologies. In the two years that followed, the company’s revenues doubled and the company’s share price increased 900 percent.
• Marshall Larsen, hugely influenced by his time at West Point and as a captain in the U.S. Army, has spent his entire career with BF Goodrich. He operates it with military precision and has led this former tire maker into becoming a world leader in aerospace systems as Goodrich Corporation.
• Frederick Eppinger had family members who’d spent more than forty years working for The Hanover Group, but by the time he took over most people were embarrassed to admit they worked for the company. During his first three years at the helm he doubled the firm’s earnings per share, tripled its share price, and made everyone proud.
• Howard Lance, the first outside CEO in the history of the Harris Corporation, proved to be the exception to the fact that outsiders underperform. During his first three years as CEO, the company more than doubled its earnings per share and share price.
• Jeffrey Lorberbaum became the CEO of Mohawk Industries while it was still just a carpeting company. Through a rapid series of twenty successful acquisitions, this CEO has transformed the company into a totally integrated flooring company with a commanding market share.
• Ronald Sargent spent fifteen years serving in numerous capacities at Staples, the world’s largest office products company, before taking over as CEO in 2002. With an emphasis on growing the top line, he’s achieved routine double-digit revenue growth and annual revenues heading for $28 billion, and more than doubled both the company’s stock price and earnings per share.
• Keith Rattie, a former long-haired, guitar-playing idealist, never dreamed he’d end up as the CEO of natural gas giant Questar. But since Rattie took the reins in 2002, the company has become a favorite of environmentalists while more than doubling its share price and tripling earnings per share.
• Mike McCallister is the CEO of Humana Inc. This $20 billion giant believes that health insurance is broken and is determined to replace a crippled, complex, and confusing system with one that works. The company has more than tripled revenues, earnings, and share price since this former hospital administrator took over as CEO.
Table of Contents
Introduction 1
Do You Have What It Takes? Twenty Quick Questions 9
Rule 1 Don't Deceive Yourself-You Will Reap What You Sow: The J. M. Smucker Company 14
Rule 2 Gain Belief: The Hanover Insurance Group 32
Rule 3 Ask for Help: Harris Corporation 51
Rule 4 Find, Keep, and Grow the Right People: Staples 69
Rule 5 See Through the Fog: ATI 89
Rule 6 Drive a Stake in the Ground: Humana 110
Rule 7 Simplify Everything: Aladdin Mills 132
Rule 8 Be Accountable: Goodrich Corporation 154
Rule 9 Cultivate a Fierce Sense of Urgency: Questar 175
Rule 10 Be a Fish Out of Water 194
120 Quotes from America's Best-Performing CEOs 206
Thanks 227
The Research 231
Index 241
What People are Saying About This
"Hit the Ground Running proves that good guys can and do finish first when they provide value-centered leadership that places the needs of customers, employees, and shareholders before the needs--or ego--of the CEO. A great read for any aspiring leader."--(Kevin L. Robert, CEO, Wolters Kluwer Tax and Accounting)
"A great read and a fantastic book filled with powerful information for anyone who wants to lead!"--(Roger Staubach, executive chairman, Americas, Jones Lang LaSalle; Hall of Fame quarterback of the Dallas Cowboys)
"Hit the Ground Running boils down the experience of ten successful new CEOs. The result is a list of rules any leader-new or seasoned-can live by."--(Mike Koehler, president and CEO, Teradata Corporation)
"I read Hit the Ground Running from cover to cover. It is a great read and one of the most interesting and useful business books I have ever read."--(Jim Goodnight, CEO, SAS Institute)
"Even though this is a practical management book, it reads with the speed of a series of short mystery novels.... These real-life stories make it clear that any leader can be successful if he or she is willing to step up and do the essentials necessary to guide the organization to significant and sustainable results."--(Dan Coughlin, President, The Coughlin Company)