Page 201 - (DK) The Business Book

WORKING WITH A VISION 199

Black Monday—October 19, 1987,
when stock markets across the world
suffered huge losses—was a strategic
inflection point that caused massive
change in the business environment.

already running behind on four
projects.” Why? “Because we are
not allowing enough lead time
when quoting.” The technique can
be used to interrogate internally
and externally caused problems.
It is also important to ask the
right questions. Management guru
Peter Drucker claims that “the most
serious mistakes are not made as a
and what it is actually doing? understand not just “what” is result of wrong answers. The truly
Actions are driven by the stark happening, but “why.” One method dangerous thing is asking the
reality of having to win business to achieve this is the “5-why” wrong question.”
in the marketplace against the technique, invented in the 1930s
competition; a company’s front-line by the father of Kiichiro Toyoda, Which questions to ask
personnel are likely to see and adapt the founder of Toyota, and used by Questioning goes beyond looking at
to a new reality first. They are the Toyota during the 1970s. By asking the competitive environment. Sales
people best positioned to identify “why?” five times, you can move bring in revenue, but companies
critical issues. from the symptoms to the root cause also have to look at costs, because
This means that leaders in the of a problem. For example, the first profit lies in the gap between these
organization have to be prepared question might be “why did we two. Managers must question their
to listen to people dealing with miss the deadline?” to which the processes, to see where they can
customers and suppliers—who answer might be “it took longer drive efficiencies, reduce costs, and
often tend to be at the lower level of to complete the project than we so improve their profit margins.
a company’s hierarchy—and absorb thought it would.” Why? “Because Managers also need to constantly
what they are saying. It helps to we underestimated the complexity question whether there might be
have an organizational culture that of the task.” Why? “Because we did a a better way to do something. For
encourages this and ensures that quick time estimate, without going example, perhaps nonessential
people are not afraid to speak out. through the project requirements functions could be outsourced.
For the same reasons, it is in detail.” Why? “Because we were Managers have to be restless,
just as important for senior not complacent, and look for every
management to listen to the kind opportunity to increase the profit
of information being exchanged in margin and improve the business.
corridor conversations, networking Managers have to use their
functions, and the general office knowledge and experience to
grapevine as it is for them to use connect all the information they
competitive analysis and modeling. It is extremely important to be gather, and try to anticipate what
able to listen to the people the world will look like in five or ten
The “5-why” technique who bring you bad news. years’ time. What changes might
To ensure they understand what is Andy Grove take place in that new world? They
driving or impacting a company’s then have to position the company
performance, and what is happening to take advantage. This requires
in the market and the wider world, thinking through several different
senior executives have to constantly scenarios and being able to think
ask questions. They also need to “outside the box.” ❯❯