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The Greatest Business Decisions of All Time
Book Review of Verne Harnish's The Greatest Business Decisions of All Time by Hazel Jackson

I am fortunate to have received a preview version of this book; it will only be published officially in October of this year. I was intrigued when author and business partner of biz-group, Verne Harnish, first told me about the concept – because how do you begin to select the greatest business decisions of all time?

The book I believe will be the first in a series and will create some hot debate and discussions on the choices. In the end they choose companies and decisions that were game changers in their industry, or era, and were counter intuitive – they went against the grain of popular practice.
Verne shares where the idea for the book came from and links it to his own material on the Four Decisions* for fast growth companies.
Verne states that although it’s a combination of thousands of decisions that lead to greatness, there seem to be a handful of decisions that stand apart from the rest – “Black Swan” moments, where the CEO could go right, left or not go at all.

* You only have to make four decisions in business – decisions around People, Strategy, Execution and Cash

Foreword

The foreword is by Jim Collins, who places a lot of emphasis on “who” rather than “what” decisions will be the biggest decisions you should control as a leader. The book covers 18 business stories and reinforces Collins perspective with eight stories revolving around people issues that were game changers.
Collins also states that many of the great decisions were not taken in isolation by the CEO, but rather decisions that evolved out of rigorous debate and with an attitude from the CEO of “I don’t know.” I found this fascinating as many leaders misinterpret their role and believe they need to have all the answers. Collins supports the principals explained in the Multipliers book by Liz Wiseman, recommending that Leaders increase their questions-to-statements ratio and to use debate to drive more informed decision making.
The research into great decisions showed typically that before each major decision, you would see significant debate. But after the decision, people would unify behind that decision to make it successful.
Collins concludes with an observation that it isn’t all about the big decisions, which this book obviously focuses on, but about the sum of the small decisions that drives a business to be great.


The Greatest Business Decisions of All Time


There is no ranking or categories; rather each story stands on its own merit. Verne picked his Top 5 personal ones though – I’ve provided a quick summary on each story and then selected the ones that I most enjoyed learning from.


Apple Brings Steve Jobs Back

The story has now been globally recognized as the game changer for Apples turnaround. In fact the initial inspiration for Verne to write the book, with the question “if this decision changed Apple, what other decisions changed the fate of businesses?” The chapter covers the lead up and poor decisions that were made by the board and the convincing by Gil Amelio for Steve Jobs to return as CEO and his haphazard slow return almost a decade after he left. The precise motivation for reinstalling Steve Jobs at Apple is irrelevant today. The fact that it happened has altered the landscape of global business for years to come.


How Free Shipping Saved Zappos

During the dotcom boom Zappos an online shoe retailer was struggling to stand out in a crowded field. The founders made a desperate decision in 1999 to offer free shipping and free returns – this lead to them realizing there true competitive advantage was not price but customer service. The chapter shares the build-up to the decision, and how it led to Zappos building a culture and business value that has been copied and envied by many.


Why Samsung pays its staff to Goof Off

How Chairman Lee Kun-Hee’s decision in the early 1990s helped build a blue print for global expansion. They sent their brightest young executives to immerse themselves in the culture of a country for 12 months. Not to work or make business contacts, but to understand how the consumers and country operated, with a strong component of the program to “goof off and learn”. Since 1990 some 4,700 employees have been serving yearlong sabbaticals in 80 countries across the global. The initiative is still in place today although it’s been slightly modified to 6 months, with some business context. It helped change Samsung from an isolated and introverted culture to the global giant it is today.


The Shareholder Comes Last

Johnson & Johnsons handling of the Tylenol laced cyanide crisis that left seven dead in 1982. How their transparency and quick decision to manage a nationwide recall and creation of a tamper proof bottle cost the company $100m, but ultimately enabled the brand to rebuild.


Why Daydreaming Pays off Big

The true story behind 3Ms culture to allow employees to spend 15% of their time on their own projects back in 1948. And how this has helped them to consistently reach the goal - 30% of revenue must come from products less than five years old. More broadly, 3Ms decision showed a doubtful world one of the knowledge economy’s most important and counterintuitive principals: A company can improve its performance by giving up control.


How Intel Got Consumers to Love Chips

How a young assistant Dennis Carter persuaded CEO Andy Grove to invest in a project to make Intel’s products appeal to the consumers, even though their clients were b2b. This is an incredible story of thinking out of the box, changing a business model and how key it is for CEO’s to be listening!


Jack’s Cathedral

Jack Welsh’s decision to invest $50m in Crotonville, GEs Executive Education Centre, whilst simultaneously laying off more than 100,000 people. The chapter covers Welsh’s thinking and philosophy and how the decision has changed the leadership talent pool that not only impacts GE’s success but countless other global businesses.


Bill Gates decides to take a week off

Gate’s celebrated ‘think week’, where once or twice a year he would shut himself away, read and deeply focus on a topic crucial to the software makers future. We all have a ‘tower of guilt’ – books or articles we really need to read to keep up to date this is perhaps one of the easier to implement decisions taken from the book.


SoftSoap’s Blocking Decision

This is my favorite chapter, because it is a David and Goliath story. In the early 1980’s a small Minnesota based business which invented a liquid hand soap made the decision to stall the big multinationals from stealing the market by buying the entire US supply of plastic hand pumps!


Toyota Pursues Zero Defects

After failing to penetrate the US market in the late 1950s how Toyota chose to adopt the ideas of quality guru W. Edwards Deming, turning its business upside down and becoming masters of the Toyota Way – the relentless pursuit of perfection.


Extreme Customer Service

Nordstrom’s decision to let customers return products – even if they didn’t buy the item at one of its stores – radically revolutionized the service industry. I loved the rules that were given to new employees on day one: “Rule No.1: Use best judgment in all situations. There will be no additional rules!”


Taking the Sting out of a painful situation

This story stood out because it was closer to home, but also because it seemed to share a decision that businesses of today could not follow. It covers the story of how Tata Steel needed to lay off people in 1993 in Jamshedpur, at a time where jobs were considered for life and even your sons and daughters were guaranteed a job if you were loyal. The chapter covers how they did this in an unusual and costly way, but that ultimately paid off.


Boeing Bets Big on the 707

The chapter covers the history of Boeing’s decision to use military jet engine technology in the commercial airline sector and how this revolutionized the aviation industry.


IBM’s Operation Bear Hug

How IBM turned around their fate from the early 1990’s to their success today. This is the story behind Lou Gartner’s decision to take the first 100 days and get back in touch with customers and how it impacted the next set of business decisions. Nick named Operation Bear Hug – Gerstner and his lieutenants traveled the world talking to customers.


Wal-Mart’s Saturday Morning Meeting
Fifty years ago Wal-Mart was a single store, when founder Sam Walton made the decision to huddle his employees every Saturday to find out what was selling, what wasn’t and to review comparison sales figures. This meeting meant Wal-Mart perfected the art of learning fast and acting fast, and thus putting those days ahead of the competition. The chapter covers why Sam made the decision and its impact today.


Is your business in trouble? Pivot!

The background to Eli Whitney’s decision to create a system that transformed the gun making industry back in 1798. The result was he turned an artisan business where craftsman made guns by hand into a factory with unskilled labor mass producing a complex product through an assembly line.


The HP Way: Putting Trust Before Profit

How Silicon Valley icon HP established the overarching ethos known as the “HP way” back in the late 1930s. Shaping how many companies create their corporate cultures today. The chapter covers the history and how the focus on values built the company over the years. Unfortunately HP have lost their way and some will challenge this is because they moved away from the core of what made them strong.


The Single Greatest Decision of All Time

When Henry Ford raised the wages of his workers in 1914 from $2.50 to $5 per day, his move flew in the face of conventional wisdom. Changing the perception that laborers were drones to important assets and fueling the economy. As the workers had more money, they became consumers, and even able to afford the very products they were producing. The chapter shares the challenges and results of this decision. Suggesting in the end that current day India and China are facing the same challenges Henry Ford did 100 years ago.


I found the book easy to read, engaging and hugely insightful, however it didn’t make me want to run out and implement what the companies had done. Rather to think very carefully about all the decisions we are making in business right now and how some could be game changers for our business and industry.

Verne wants debate and discussion on the selected 18 decisions, plus what you think should have made the list. Share your views on their website, www.greatestdecisions.com - Hazel Jackson, CEO of biz-group
Listen to the podcast of Hazel Jackson on The Library, Dubai Eye 103.8 reviewing Verne Harnish's The Greatest Business Decisions of All Time
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