“We take great care of our people, our people take great care of our customers, and our customers take great care of our shareholders.” Herb Kelleher
That statement was Kelleher’s response whenever asked how Southwest Airlines became the most profitable airline (of the ten largest) with the greatest cap value than the others…combined.
Ram Charan, Dominic Barton, and Dennis Carey nail it in the Introduction to their book: “Most executives today recognize the competitive advantage of talent, yet the talent practices in their organizations use are vestiges of another era. They were designed for predictable environments, traditional ways of getting work done, and organizations where lines and boxes defined how people wre managed. As work and organizations become more fluid — and business comes to to mean sensing snd seizing new opportunities in a constantly changing environment, rather than panning for several years into a predictable future — companies must deploy talent in new ways. In fact, talent must lead strategy.”
Charan, Barton, and Carey wrote this book so that the information, insights, and counsel they provide could serve as a “new playbook” for a new global marketplace, one in which never before has talent been more important to the success of the given enterprise. “Talent is king. Talent, even more that strategy, is what creates value.” Human capital must be managed as wisely as financial capital. Human resources must be elevated to the same level as finance.
One of the most valuable insights is Charan, Barton, and Carey’s concept of what they characterize as G3, “the most important and most powerful tool at the disposal of any modern CEO.” Think of it as “the central braintrust of a talent-first organization.” Briefly, G3 consists of the CEO, CFO, and CHRO or head of HR. (In some organizations, they are joined by the general counsel, thus becoming a G4.) Deploying finance and talent together creates exponential power.
All organizations need to obtain or develop the talent they need to compete successfully in a business world that is more volatile, more uncertain, more complex, and more ambiguous than at at any prior time that I can recall. The G3 or G4 mechanism is critical to making the right decisions about the most important issues but it adds substantial value collaborative initiatives between and among those on different levels and in different operational areas. These interactions ‘trigger a multiplier effect that can exponentially increase the value that your talent delivers to the organization.”
These are among the passages of greatest interest and value to me, also listed to suggest the scope of Charan, Barton, and Carey’s coverage:
o Critical 2 percent (Pages 6-7)
o The Chief Executive Officer (15-18)
o Value creation (24-26 and 35-36)
o Identifying and cultivating talent (24-28)
o Aligning a board of directors with a talent-driven organization (37-56)
o General Electric (42-44, 118-120, and 125-126)
o Steve Jobs (45-46, 142-144, and 162-163)
o Facebook (58-63)
o Ruimin Zhang (64-67)
o Human Resources as a source of competitive advantage (79-101)
o Data analysis by the HR department (84-90)
o Unleashing individual talent (103-129)
o Legacy processes (115-123)
o Stefan Jacoby (135-136 and 151-152)
o Competing for talent (137-140)
o Peripheral vision (140-144)
o Operational checklist (164-167)
These are among the concluding thoughts that Ram Charan, Dominic Barton, and Dennis Carey share when explaining how to drive the talent agenda: “And that, of course, is the great promise of leading a talent-first organization: seeing new ideas lead to even better ideas; watching the creative thinking that you’ve enabled amplify itself across divisions and varying levels of seniority and expertise; and reaping the benefits of value that arises from expected, and unexpected parts of your company.”
The average tenure of a CEO now is about half of what it was only a few years ago. Why? Reasons vary but the fact remains that even the most talented CEOs need what a G3/G4 offers and few have that. They also need a governing board in proper alignment with both senior management and the organizational objectives. A new business “game” requires a new “playbook” and a people-first “team” to compete successfully. For current CEOs and for those who aspire to become one, this book is a “must read,” a brilliant achievement. Bravo!