I was fortunate to see Sir Terry Leahy present at The Telegraph's Festival of Business.
He's an engaging presenter and outlined eight management tips. I was struck by the pivotal role of data, insight and applying insight within organisations in his recommendations - Tesco's success is widely attributed to data being at the heart of the organisation but it was encouraging to see Sir Terry reference this many times with new, start-up businesses that he is involved with.
The eight lessons are:
1. Find the truth.
Honestly assess performance as alternative reality is the only other option. Finding the truth is about looking for the 'signals of change'.
There was also a stark observation that I certainly recognise from many clients that we worth with:
data should come in at the top of the organisation but doesn't; it comes in at the bottom and the story it tells becomes a fairytale by the time it reaches the Board as each management layer adapts the story and turns it into good news.
2. Set audacious goals
No one is motivated by mediocrity. Set ambitious goals that will really make a difference to the business and go after them.
(This was a topic that we returned to later in the day in an engaging presentation by Octavius Black of MindGym. Octavius presented a catalogue of research clearly demonstrating that people respond best to stretching targets. This should be a key tenet of performance management.)
3. Vision, values and culture
You must be able to articulate why your business is worthwhile.
This must then be communicated to customers and your people.
4. Follow your customers
Get as close to them as you possibly can. Use this knowledge to break down existing conventions.
Tesco Express was referenced as an example of this - the retail for convention was big out of town sheds but customers wanted convenience.
5. The steering wheel
Create a balanced scorecard and link all jobs to what really matters. Don't pursue 1 target at the expense of others.
6. Data is priceless
Clubcard is more famous than Tesco internationally. At the time it launched Tesco's net margin was 4%; the investment in Clubcard was going to cost 25%(1% point) of their net margin. Tesco made the investment because they had tested the concept and knew that they would be able to deliver more effective marketing.
7. Competition is good
The challenge is to learn quicker about the competition than they can learn about you
8. Leadership matters
A good leader will take you further than you would go yourself.
Sir Terry also went through what he believes are the key drivers of growth. They are noted here:
• Health & beauty
His point on loyalty was that brands are doing all they can to engender disloyalty by offering the best deals to new customers and encouraging customers to switch.
I should add that Leahy has written a book [embed link to http://amzn.to/PLHgSN] that elaborates on these lessons and provides further pearls of wisdom. Highly recommended.
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