Beyond Performance: How Great Organizations Build Ultimate Competitive Advantage
In an ever-changing world where only a third of excellent organizations stay that way over the long term, and where even fewer are able to implement successful change programs, leaders are in need of big ideas and new tools to thrive. In Beyond Performance, McKinsey & Company's Scott Keller and Colin Price give you everything you need to build an organization that can execute in the short run and has the vitality to prosper over the long term.
Drawing on the most exhaustive research effort of its kind on organizational effectiveness and change management, Keller and Price put hard science behind their big idea: that the health of an organization is equally as important as its performance. In the book's foreword, management guru Gary Hamel refers to this notion as "a new manifesto for thinking about organizations."
- The authors illustrate why copying management best practices from other companies is more dangerous than helpful
- Clearly explains how to determine the mutually reinforcing combination of management practices that best fits your organization's context
- Provides practical tools to achieve superior levels of performance and health through a staged change process: aspire, assess, architect, act, and advance. Among these are new techniques for dealing with those aspects of human behavior that are seemingly irrational (and therefore confound even the smartest leaders), yet entirely predictable
Ultimately, building a healthy organization is an intangible asset that competitors copy at their peril and that enables you to skillfully adapt to and shape your environment faster than othersgiving you the ultimate competitive advantage.
INTRODUCTION Excellence Found? Xiii
Only a third of organizations both achieve and sustain excellence. Why so few? People have been working together for millennia—you’d think we’d be better at it by now. And what’s the cost to business and society that we’re not?
PART I WHY PERFORMANCE IS NOT ENOUGH
CHAPTER 1 The Big Idea: Performance and Health 3
Performance is about delivering financial results in the here and now. Health is about the ability to do it year in, year out. The two are not the same. Some companies have neither; others have just one. The ultimate competitive advantage lies in having both. But how?
CHAPTER 2 The Science: Hard Facts behind the Soft Stuff 25
Health is every bit as measurable as performance. The path to health is just as clear as that to performance. The most exhaustive research ever undertaken in the field tells us so. Is a change in management accounting called for?
PART II THE FIVE FRAMES
CHAPTER 3 Aspire: Where Do We Want to Go? 47
Should we put more emphasis on short-term goals or long-term vision? Actually, it’s the medium term that matters most. Is there a recipe for success? In fact, there are four. Discover what a lottery ticket has to do with deciding which one is right for your organization.
CHAPTER 4 Assess: How Ready Are We to Go There? 77
You know where you want to go, but does your organization have the will and the skills to get there?
Finding out isn’t easy, but it is possible. Understand how through lessons learned from running a four-minute mile and observing disenfranchised monkeys.
CHAPTER 5 Architect: What Do We Need to Do to Get There? 109 Now it’s time to plan the journey to achieve your goals.
Working out what to do to improve performance isn’t enough—you need to decide what not to do as well.
And designing the how just as thoughtfully as the what will be the key to unlocking better health.
CHAPTER 6 Act: How Do We Manage the Journey? 155
Staying the course requires flexibility—adjusting as you go. Understand a tale of two pilots, put in place the right structure, and measure the right things. You’ll need extraordinary amounts of energy, so use both military and marketing tactics to drive ownership.
CHAPTER 7 Advance: How Do We Keep Moving Forward? 177
Now what? Keep changing! Once you’ve built the infrastructure for continuous improvement and the leadership competencies to drive your organization forward, change will come naturally. Ultimate competitive advantage is yours.
PART III PUTTING IT ALL TOGETHER
CHAPTER 8 The Senior Leader’s Role: Does Change Have to Start at the Top? 203
The senior leader casts a long shadow. The road to success is immeasurably easier if they embrace the role that only they can play. That means making it personal, getting the right team in place, and applying the right levels of challenge and support.
CHAPTER 9 The Five Frames in Action: How Do You Make a Great Organization Even Better? 219
It’s one thing to face the challenge of turning around a struggling organization. But how do you set about transforming when life is good? Follow one company as it makes its journey through the five frames.
CHAPTER 10 Making It Happen: Do You Have What It Takes? 231
Now you’ve got the knowledge, what are you going to do with it? Start by getting a firm grip on your organization’s performance and health. Then work through the five frames. If the odds of becoming and staying excellent are to improve, it starts with you.
Recommended Reading 261
About the Authors 269
Colin Price is a director in McKinsey's London office, and leads its organization practice worldwide. He has advised many of the world's largest corporations, several national governments, and a number of charitable institutions. His booksinclude Mergers (with his colleague David Fubini and Maurizio Zollo of INSEAD), and Vertical Take-Off (with Sir Richard Evans, former chairman of British Aerospace). He holds degrees in economics, industrial relations and psychology, and organizational behavior. He is an associate fellow at Saïd Business School, University of Oxford, and a visiting professor at Bath University.
—Robert Sutton, Stanford Professor and author of Good Boss, Bad Boss