Executive Times

Volume 2, Issue 12

December, 2000

ã 2000 Hopkins and Company, LLC

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Polarized constituents

The next President and Chief Executive Officer of the United States will lead 49 million voters who selected him; 49 million voters who chose someone else; and about 49 million eligible voters who decided not to vote. As of our publication date, we still don’t know who that President will be. That new president will face a situation most executives deal with daily: how to lead and manage a polarized and diversified constituency. Which constituents come first, and why? Can a diverse workgroup, like a team of employees, work together for common success? What conditions can an executive create to ensure that the organization prospers along with its constituents? What does an executive need to do to ensure inclusion and cooperation? When does an executive need to act in ways that are not supported by key constituents? When is an executive left out in the polar cold after alienating board members, shareholders, employees, customers, members or voters? Then what? Enjoy reading this holiday issue of Executive Times, which contains our expanded book list, including highlights from 2000 reading and a look into 2001. Readers of the print issue can go to http://www.hopkinsandcompany.com/et1200sub.html to access the links in the web version.

Forward to the past

At least two more companies brought back a former CEO recently, following disagreements over strategic direction. Maytag Corporation announced in November that Leonard Hadley (CEO from 1992 to 1999) will replace CEO Lloyd Ward who resigned following “a difference with the Board of Directors over the Company's strategic outlook and direction.” Ward’s short tenure was marked by a big decline in stock price, and rumors of Maytag being acquired by a European company. The October 1999 issue of Executive Times called attention to the early trial by fire faced by Ward following an earnings surprise, and we predicted, in error, that Ward would “prove to be a great CEO for Maytag.” The Board disagreed, and gave the company’s reins back to Hadley while they search for a “permanent” CEO. Newell Rubbermaid announced the resignation of CEO John J. McDonough and his replacement with former CEO, current Chairman William P. Sovey. According to The Wall Street Journal (11/2/00), McDonough was unable to generate earnings growth following Newell’s merger with Rubbermaid in 1999.

How do you know when it’s time to reverse direction? Signs like stock price and merger flops can lead directors to change CEO’s quickly. What signs do you use to initiate changes? When you differ on strategic direction, what do you do? Who will you rely on during a transition? Can a former CEO step in? If you are a CEO, how do you assess the alignment or differences with your Board of Directors? If a former CEO sits on your board, what’s your relationship with that person? If you’re grooming yourself or being groomed to become a CEO, what key skills are you focused on? What will make you the best CEO for the organization?

Dimpled chad

What is it about reverses in strategy and changes in direction by others that some of us find amusing? Is there a seasonality in trends to diversify and attempts to focus? Are those seasons changing faster than ever before? Like the dimpled chad on keypunch voting cards, what’s the intention of companies that begin to seek out others, and then back away abruptly? Recently, we were surprised when Coke engaged in talks to acquire Quaker, gaining the strong Gatorade brand, but also acquiring a diversification into food that would move Coke away from its long-term exclusive focus on beverages. It appears that Coke moved because Pepsi was interested, then backed away when the Coke Board voted no. Hewlett Packard moved forward to explore acquiring the consulting business of PriceWaterhouseCoopers, then backed off. CEO Carly Fiorina reaffirmed the strategic logic of the deal, but given the failure to come to terms, decided to remove the distraction. Tomorrow is another day.

What leads you to look outside your core business? Are you tentatively punching chad, leaving a dimple and an uncommitted exploration of a new business, or have you decisively penetrated into a new business arena? Are you distracted by the actions of competitors, leading to a change in your direction, or do you remain focused on your own plan? When do you decide to move ahead, and when do you decide to walk away? What causes you to focus, and what distracts you?

Reading

(Note: readers of the web version of Executive Times can click on the book covers or titles to order copies directly from amazon.com. When you order through these links, Hopkins & Company receives a small payment from amazon.com. Subscribers to the print version of Executive Times can receive the web version at no additional cost. Send e-mail to hopkinsandcompany@att.net with a request to be placed on the web version distribution list. Also, not all books we read make it to the pages of Executive Times. Check out other book selections on our bookshelf at http://www.hopkinsandcompany.com/bookshelf.html).

Based on suggestions from readers, this year’s expanded book section highlights the best and worst from the 2000 issues of Executive Times as well sections on books that never made these pages and books we’re looking forward to for 2001.

The Top 10 Recommended Books from Executive Times 2000:

Title	Author	Issue Date	Executive Times Advice	Purchase
Flawed Advice and the Management Trap: How Managers Can Know When They’re Getting Good Advice and When They’re Not	Argyris, Chris	05/00	Having trouble implementing the recommendations of consultants? Argyris explains why and takes on other consultants in the process. Highly recommended.
First, Break All the Rules	Buckingham, Marcus and Coffman, Curt	2/00	Buy this book and pick and choose some approaches used by great managers that fit your individual style.
Leading the Revolution	Hamel, Gary	10/00	Reading this book is annoying, disturbing and uncomfortable, which are three great reasons to pick it up. Read more about this book.
Birth of the Chaordic Age	Hock, Dee	4/00	Great story about the founding of VISA International and the principles on which the organization was based. Hock proposes ways for organizations to reinvent themselves. Highly recommended.
Of Money and Markets: A Wall Street Memoir	Kaufman, Henry	8/00	Economic history at its best. Kaufman’s writing is careful and clear. Highly recommended.
Trusted Partners: How Companies Build Mutual Trust and Win Together	Lewis, Jordan	09/00	Highly recommended, practical book that tells detailed stories about what line managers actually did to form alliances with other companies. Text is accompanied by tools that you can use in exploring your own alliances.
The New New Thing	Lewis, Michael	5/00	The story of Jim Clark of Silicon Graphics, Netscape and Healtheon fame as told by a great writer. This book is a reading pleasure and we recommend it highly.
When Genius Failed: The Rise and Fall of Long Term Capital Management	Lowenstein, Roger	11/00	This is a great story of hubris and dumb mistakes by very smart people. Read more about this book.
Winston and Clementine: The Personal Letters of the Churchills	Soames, Mary	2/00	Highly recommended. Eavesdrop on their sixty year loving relationship.
Taken for a Ride: How Daimler-Benz Drove Off with Chrysler	Vlasic, Bill and Stertz, Bradley A.	8/00	Great book that discloses the behavior of key players as Daimler steals Chrysler. Reads like a good mystery. Recommended.
Non-Zero: The Logic of Human Destiny	Wright, Robert	6/00	A well-argued thesis that organic history and human history have a direction. If we are heading somewhere, Wright thinks it’s likely to be toward mutual cooperation, hence the non-zero concept from game theorists.

Worst 5 Books from Executive Times 2000

Title	Author	Issue Date	Executive Times Advice	Purchase
Living the 7 Habits: Stories of Courage and Inspiration	Covey, Stephen	5/00	Vapid anecdotes that lack context. Take a pass on this book and Covey in general. Do what works for you.
Business Dad: How Good Businessmen Can Make Great Fathers (and Vice Versa)	Hirschfeld, Tom	1/00	Tedious and overdone. Take a pass or give as a gift to a young MBA parent that you really don’t like.
Now or Never	Modahl, Mary	10/00	Informercial from a VP at Forrester Research. Sample if you have to. Read more about this book.
Vote.com	Morris, Dick	4/00	Useless promotional screed for author’s website. Take a pass.
Scandalmonger	Safire, William	6/00	A precise historical rendering with a made-up story set in Revolutionary times.

10 more recommended books not reviewed in Executive Times 2000

Print readers can access “read more about this book” at http://www.hopkinsandcompany.com/books/list.htm

Title	Author	Comments	Purchase
Postville: A Clash of Cultures in Heartland America	Bloom, Stephen G.	When a group of Lubavitchers opened a kosher slaughterhouse in rural Iowa, the town of Postville changed dramatically. Read more about this book.
A Friend of the Earth	Boyle, T. C.	Readers are likely to either hate or love reading Tom Boyle’s novels. This latest one makes fun of environmentalists while presenting a fairly depressing tale if you take him too seriously.
The Amazing Adventures of Kavalier & Clay	Chabon, Michael	Chabon’s done everything we want a good novelist to do: well developed characters, engaging plot, descriptive language. Highly recommended. Read more about this book.
The Devil Never Sleeps	Codrescu, Andre	This book of essays by poet Andre Codrescu is funny and irreverent, two good reasons to pick it up. You may have heard him on National Public Radio, or checked out his online periodical, Exquisite Corpse.
American Pharoah: Mayor Richard J. Daley---His Battle for Chicago and the Nation	Cohen, Adam and Taylor, Elizabeth	Flattering biography of the late Mayor Richard J. Daley. Some of his complexity is explained and the reader learns as much about Chicago as about Daley. Well worth reading.
Cowboy	Davidson, Sara	A well-told love story. Unexpected romance and love strikes the heroine and leads her to adventure. Davidson hooks you early on, and reading each page is a pleasure.
Big City Eyes	Ephron, Delia	Enjoyable and engaging. Sometimes Ephron leads the reader to laughing out loud; most of the time, one reads with an ongoing smile. A pleasant evening’s reading. Read more about this book.
Never Die Easy: The Autobiography of Walter Peyton	Peyton, Walter with Don Yaeger	Inspiring story of Peyton’s life and his courageous fighting spirit as an athlete and in battling cancer. Read more about this book.
EVEolution: The Eight Truths of Marketing to Women	Popcorn, Faith	If you’re marketing to women, this book is required reading. Popcorn presents eight truths with clarity and examples. Read more about this book.
Generations at Work: Managing the Clash of Veterans, Boomers, Xers, and Nexters in Your Workplace	Zemke, Ron	This is one of the few books we’ve run across that delves deeply into what it takes to ensure that a workplace nurtures the skills of workers across different generations, and ensures that they listen well to each other and work together effectively.

10 books we look forward to reading in 2001

Title	Author	Comments	Purchase
Nothing Like It in the World: The Men Who Built the Transcontinental Railroad 1863-1869	Ambrose, Stephen E.	Ambrose writes history with care and joy, and the reader usually comes away with information and interest, stimulated by fine writing. Building the railroad was a significant feat, and the technological obstacles were considerable. We expect Ambrose to lead us through this book with his usual skill.
The Blind Assassin	Atwood, Margaret	We’ve liked other Atwood novels, and expect that this Booker award winner will be a joy to read.
Joe DiMaggio: The Hero’s Life	Cramer, Richard Ben	Where did the myth end and the man begin? What about this hero was real, and what was made up? We look forward to reading this book, said to be meticulously researched by its Pulitzer-prize winning author.
The Informant: A True Story	Eichenwald, Kurt	Mark Whitacre’s name was all over the business press during the early 1990’s when the former Archer Daniels Midland VP went undercover for the FBI to reveal a price fixing scandal. Later, we learned Whitacre was embezelling from ADM. We expect this book to read like a novel, and look forward to picking it up.
The Inextinguishable Symphony: A True Story of Music and Love in Nazi Germany	Goldsmith, Martin	Listeners to National Public Radio’s Performance Today have come to appreciate Martin Goldsmith’s love of fine music. This book presents the story of Goldsmith’s family and the suffering they endured in Nazi Germany.
Damn Right: Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger	Lowe, Janet	We’ve all heard of Warren Buffet, but his long-time partner Charlie Munger has taken a lower profile. We’re curious to see if Munger really is “the brains behind Warren Buffet.” We know that Munger’s a staunch advocate of ethical business practices, and look forward to reading what else this book has to say about him.
Darkness in El Dorado: How Scientists and Journalists Devastated the Amazon	Tierney, Patrick	Controversial book about exploitation of the Yanomani, a native Amazon culture. Tierney claims that warfare among the Yanomani was instigated by the anthropology researchers working there. If you liked Jared Diamond’s Guns, Germs, and Steel, you’ll probably like Darkness in El Dorado.
Diamond Dogs: A Novel	Watt, Alan	We like to try out new authors regularly, and read some fine things about this first novel. The story is of a teenage hit and run, and the relationship between a father and a son.
Maestro: Alan Greenspan's Fed and the American Economic Boom	Woodward, Bob	Has Watergate investigative reporter Bob Woodward dug up any new information about Alan Greenspan? Are we even a little curious? Read excerpts from The Washington Post. We read enough to want to read the rest of the book, and look forward to it.

ã 2000 Hopkins and Company, LLC. Executive Times is published monthly by Hopkins and Company, LLC at the company’s office at 723 North Kenilworth Avenue, Oak Park, Illinois 60302. Subscription rate for first class mail delivery of the print version is $60.00 per year (12 issues). E-mail subscriptions are $30.00 per year. Single issues: $10.00 print; $5.00 electronic. To subscribe, sign up at www.hopkinsandcompany.com/subscribe.html, send an e-mail to hopkinsandcompany@att.net, call (708) 466-4650, or fax to (708) 386-8687. For permission to photocopy or e-mail Executive Times, call (708) 466-4650 or e-mail to hopkinsandcompany@att.net. We will send sample copies if requested. The company’s website at http://www.hopkinsandcompany.com/archives.html contains the archives of back issues beginning in the month after the issue date.

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