The Agenda (Michael Hammer): Useful for This Decade as Well

Way back in 2001, Michael Hammer authored The Agenda: What Every Business Must Do to Dominate the Decade. Slightly more than a decade later, the thoughts and insights in this book remain relevant and worth summarizing.  The key assumption in The Agenda is that customers are more powerful than ever. Of course, with the flowering of the Internet and the advent of Social Media, it is obvious that we now live in a customer-centered business climate. Based on this assumption, Hammer lays out 9 agenda items for every business.

Agenda Item 1: Make It Easy for Your Customers to Do Business With You

  • Present a single face to your customers
  • Work in different ways for different classes of customers
  • Know what your customers will ask for before they do
  • Make your customers’ experience a seamless one
  • Let customers do more for themselves
  • Measure the things that customers really care about

Agenda Item 2: Add More Value to Your Customers

  • Ask these questions
    • What do our customers do with our products after they receive them from us?
    • What are the broader business or personal problems that our customers have?
    • What more can we do to help them solve these problems?
  • Think of yourself as a provider of solutions, rather than of products or services
  • Distinguish between what you are selling and what your customer is buying
    • You are selling a product or service
    • Customers are buying a solution to a problem or something that gives them pleasure
  • Take a broad view of your customers’ underlying problems that go beyond you and your products
  • See what your customers do with what you give them, and either do it for them or help them with it
  • Price in terms of value rather than cost

Agenda Item 3: Create a Process Enterprise

  • Obsess about the end to end processes that create all value for your customer
  • Ensure that every employee understands processes and their role in them
  • Develop a culture of teamwork and shared responsibility
  • Make process a way of life
  • Processes are customer focused and teleological (focusing on the outcome of the work rather than the work itself).
  • In a good process company, it does not take heroic work from talented individuals to get the job done. Good work from good employees can produce an outstanding product.
    • HP says you don’t have enough process if it takes exceptional people to do ordinary things – if it requires heroics to perform work that should be routine
    • You have too much process if your exceptional people can’t sometimes do exceptional things
    • More companies suffer from not enough process than from too much process

Agenda Item 4: Tame the Beast of Chaos with the Power of Process

  • Recognize ‘champions’ and ‘heroics’ for what they are: signs of dysfunction
  • Leverage your people’s creativity with the power of process
  • Make innovation repeatable through detailed process design
  • Don’t let people tell you that creativity conflicts with process
  • Be resolutely committed to discipline and teamwork

Agenda Item 5: Base Managing on Measure

  • Take measurement out of accounting and make it part of every manager’s job
  • Abandon the measures you have inherited from the past
  • Develop a model of your business that links your overall goals to specific things you control
  • Put in place measures and targets for the key items in this model
  • Design measures that are objective, timely, easy to calculate, and easy to understand
  • Make ongoing performance improvement inevitable by incorporating it into a disciplined measurement based process
  • Let facts and measurements triumph over intuition and opinion
  • But, be careful what you measure, you may get it – and it may kill you.

Agenda Item 6: End the Tyranny of the Organizational Chart

  • The problem with the matrix is that the different managers did not share the same goal
  • Get over the idea of sharply defined business units with autonomous managers
  • Redefine managers as representing markets, products, or processes, rather than having total control over them
  • Make managerial teamwork and cooperation the rule rather than the exception
  • Teach managers to put the needs of the enterprise as a whole first
  • Employ rewards that emphasize the group over the individual

Agenda Item 7: Distribute for, Not to, the Final Customer

  • Make maximizing value and minimizing cost for the final customer your number one priority
  • Turn your distribution channels into communities that work together for common goals
  • Use the Internet to share information and streamline transactions
  • Drive out redundant work, especially the repetitive buying and reselling of product.
  • Companies need to be closer to their final customers in order to hold them, to up-sell them and to cross-sell them and to garner high margin follow-on sales. They need to be closer to serve them quickly and accurately. They need to be closer to drive out the huge costs and inefficiencies, the redundant work and piles of inventory, that clutter existing channels.
  • What problems does a customer have in the process for acquiring and using a product and how can a manufacturer and its distribution partners best collaborate to help solve these problems?

Agenda Item 8: Redesign and Streamline Inter-enterprise Processes

  • Root out the remaining sources of overhead, cost and inventory by redesigning inter-enterprise processes
  • Streamline the connections between your processes and those of your customers and suppliers.
  • Relocate work between companies so that it is done by whoever can do it best
  • Coordinate through open sharing of data between companies
  • Exploit the opportunity of collaborating with co-customers and co-suppliers
  • Face head on the deep cultural challenges of inter-company cooperation and information sharing.
  • Guidelines
    • The final customer comes first
    • The entire process should be designed as a unit
    • No activity should be performed more than once
    • Work should be done by whoever is in the best position to do it
    • The entire collaborative should operate with one database

Agenda Item 9: Embrace the Radical Vision of Virtual Integration

  • See your business not as a self-contained company but as part of an extended enterprise of companies that work together to create customer value
  • Define your company in terms of the processes that you perform, not the products or services you create
  • Identify and strengthen the key processes at which you excel
  • Outsource everything else to someone better equipped to do it
  • Learn to work closely with others; not just on your own.

Other Thoughts: Prepare for a future you cannot predict by institutionalizing a capacity for change

  • Create an early warning system to spot changes to which you must respond quickly
    • Develop deep insight into your customers
    • Analyze potential as well as existing competitors
    • Look for the seeds of the future in the present
  • Become adept at rapidly designing and installing the new ways of working that such external changes demand
  • Create an organizational infrastructure that supports both of the first two.
    • “We are going to create the company that will put us out of business.” (American Express)
    • “The day you believe you’re successful is the day you stop being successful.” (Herb Kelleher, Southwest Airlines)
    • “The best companies are always worried. Only the paranoid survive.” (Andy Grove, Intel)
    • Winners make more mistakes than losers
    • The best way to have lots of good ideas is to have lots of ideas and throw away the bad ones
    • If you wait for all the lights to turn green, you will never get started
    • When memories exceed dreams, the end is near. Past results are no guarantee of future success.
  • It is your responsibility to leave your successors a better platform on which they can build

About David Shedd

David has been a President - CEO - COO of an up to $350M group of manufacturing, distribution, specialty retail and services companies, having led 22 different businesses from turnarounds to start-ups to fast growth companies.
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