Leaders of the Pack
October 1, 2005
Leaders of the Pack
by Dan Malovany
A few years ago, Jason Jennings wanted to find out which companies were the best in the world and what made them tick. What he found was that a surprising few fit the bill.
To define which ones were the best in the business, his research team pulled together a list of 72,000 public and private companies worldwide and discovered that only 120 companies have grown their gross revenues 10% or more through good and bad times for at least a decade.
Suspecting that some companies may have lowered prices to gain market share, Jennings’ group also examined those 120 companies’ profitability and guess what? Fewer than 20 saw both their sales and profits rise at double-digit rates for 10 or more years in a row.
Among the CEOs Jennings interviewed, he found similar traits. First, they weren’t traditional leaders. They were stewards of their organization. He defined stewardship as “service over self-interest.”
Before you say bullwipe, hear Jennings out. He’s not Alan Alda on the motivational speech network. He believes “there’s no magic in a stupid five-year plan.” It’s all about execution. Mission statements, he adds, are really an excuse for top management to get hammered and play golf at an exclusive resort over a weekend on a company tab. In most cases, they’re a joke.
Speaking at the Snack Food Association’s Top Management Seminar in September, Jennings noted that the companies that have the best proven track record over the past decade all have an entrepreneurial spirit. They all “Think Big Act Small,” which is, not surprisingly, the name of his new book.
Jennings notes that the leaders are accessible to both customers and employees, and they don’t just give it lip service. He recalls how he found one CEO’s number by flipping through the local phone book. “Why shouldn’t it be in there?” the CEO asked. “How are my people supposed to reach me if it’s not?” Then the guy invited Jennings over for pizza with his kids.
Another common trait among these CEOs is that they all spend at least 50% of their time with their customers, listening to what they want. They have figured out that satisfying the customer isn’t enough. Consumers don’t walk out of a supermarket and say, “Gee that was satisfying.” They expect to be satisfied. Rather, these CEOs believe in exceeding the expectations of the right customers.
Moreover, they don’t dress or look like a CEO or walk around like they own the place, even though they do. That’s because they’ve hired like-minded people who believe in their cause, which is how they are changing their little part of the world, and they allow their employees to act as if they were owners of the business. If you need to hire a chief culture officer, you just don’t get it.
This year’s Buyer’s Guide theme is “Discovering New Opportunities in Challenging Times.” Ask any baker or snack producer about the single most dominant trend impacting their industry, and they’ll reply, “It’s the cost of doing business today.”
Simply put, energy, labor, packaging and benefit costs are rising faster than many companies can pass on with price increases.
To succeed in these difficult times, it’s no longer enough to be the best that you can be. Today’s food companies need to emulate the best of the best in the world.