People
Different types of organisation require different types of leaders. Think of start-ups with their dynamic entrepreneurs, mature companies with their solid but hopefully inspirational CEOs, companies in difficulty with their turnaround specialists. Each also requires managers and employees with different personality make-ups. Think of the combination of personality types
needed in banks compared to those in advertising agencies.
Products
Successful products are notoriously hard to predict. There are subtle combinations of social, cultural and technological circumstances that mean that something will succeed at one time but not another. People talk rightly about a product ‘whose time has come’. The technology to meet a particular need may exist for a long time before the product on which it is based takes off. For example, photocopying technology was around for years before photocopiers were commercialised on a large scale. In the beginning, cost may be a factor, but after a time a critical mass of users develops, costs come down, and no one ‘can understand how they could have done without one’.
Companies
Success factors here include energy, vision and efficiency, but many of the companies that were thought to possess these attributes 30 or even five years ago are not those we would think of as having these qualities today. Management fashions are a big factor: gurus and management books have a lot to answer for. Once something becomes a mantra, everyone starts doing it, but objective measures of the relative efficiency of each type of company are hard to find. Different types of activities require different approaches to deliver strong financial results, the one measure of success that people usually agree on.
Countries
Economic success stories such as Japan, Germany and Sweden became models that everyone wanted to imitate. In the 1970s, government experts and academics went to these places by the planeload looking for the magic ingredients. In the 1980s and early 90s they went to the emerging economies of the so-called ‘Asian tigers’. Now China is seen as the country to watch. At various times, commitment to self-improvement, entrepreneurial flair, efficient access to capital, vibrant institutions, a good education system and good infrastructure are held to be important factors for success, but the countries mentioned above possess these to very varying degrees.
In any case, how can companies and countries imitate others? Companies have a particular culture that is the result of their history, short or long. If managers and their consultants change them radically, for example by downsizing them, they may be ripping out the very things that make them tick. On the other hand, change may really be necessary, and companies with cultures and structures that were successful under earlier conditions are very hard to change in a genuine way, even if they go through the motions of adopting the latest management fashion.
With countries, how do you imitate social structures and habits that have evolved over centuries elsewhere, often with an entirely different starting point? The old joke about not wanting to start from here if you’re going there is applicable. Also, by the time the model has been identified as one worth imitating, the world economy has moved on, and your chosen model may no longer be the one to follow.
Ability to adapt is key. Here, the US is world leader in adapting old organisations to new conditions
– McDonald’s and IBM, for example, have had amazing turnrounds from earlier difficulties. But radical innovation is equally important. The US is also good at generating entirely new companies that become world leaders. Though not as dominant as it once was, the US economy seems to be particularly good at producing these companies – witness Microsoft, Intel and Google. China, for all its new-found economic power, has yet to produce a company in this league.
Read on:
- James C. Collins, Jerry I. Porras: Built to Last: Successful Habits of Visionary Companies, Random House, 2005
- Michael Hoyle, Peter Newman: Simply a Great Manager: The 15 fundamentals of being a successful manager, Marshall Cavendish, 2008
- Michael E. Porter: Competitive Advantage of Nations, Free Press, 1998