What Business Winners Do Right, Where Business Losers Go Wrong¹

Allen F. Wysocki and Karl W. Kepner²

Introduction

Beginning with the book In Search of Excellence by Peters and Waterman, significant management research resources have been spent in an effort to identify the business characteristics that are most shared by business winners. Some studies have also focused on identifying the characteristics that tend to be shared by those business organizations that are not effectively achieving their performance potential; these might be described as business losers. Certainly, a logical strategy for improving business performance would involve avoiding the characteristics of business losers while emulating the characteristics of business winners.

Business Losers

Characteristics

Research has identified at least six characteristics that tend to be associated with poor performing business organizations (Table 1). The checklist in Table 1 can be used by managers to evaluate the extent to which the loser characteristics are descriptive of their business organization. In this regard, it is often useful to obtain the perspectives of many organizational managers and discuss in some detail the reasons for perception differences.

1. Financial poverty. Many business organizations suffer from financial poverty because they are often started with inadequate financial reserves or have inadequate funds to invest in needed and critical resources. (Without adequate financial resources, organizations often die prematurely.)

2. Managerial Short-sightedness. This can be demonstrated in many ways (e.g., not planning for the future, short-term actions that jeopardize long-term longevity, and an “if it ain't broke, dont fix it” management philosophy).

3. Managerial Blundering. This term is used to describe management teams that have botched important decisions (e.g., the Ford Edsel and New Coke fiascos).

4. Managerial Ignorance. At least three types of managerial ignorance can be identified: (1) when management doesn't know, (2) when management doesn't know that it doesn't know, and (3) when management thinks it knows but it doesn't. (Under these circumstances, there is no incentive to obtain the knowledge that will correct the ignorance.)

5. Managerial Cowardice. This term refers to situations where the needed actions are known and the financial resources exist, but the management team is afraid to take and implement the needed actions. (Management is afraid to risk new opportunity investments.)

6. Organizational Impersonality. This is a major cause of business failure (e.g., managers not knowing their workers' names, automated telephone systems, and customers having to pay extra to personally interface with organizational personnel).

Actions

To what extent are any of these business loser characteristics descriptive of your organization? Which loser characteristic poses the greatest threat to organizational survival? What specific actions need to be taken within what time period to eliminate existing loser characteristics? These are hard questions for management. Yet, organizational survival may well be dependent on objective analysis and actions taken on these and related questions involving these six business loser characteristics.

Business Winners

Characteristics

Several years ago as a follow-up to the In Search of Excellence research, the Arthur Anderson organization identified 10 characteristics that permeated throughout successful mid-size U.S. business firms (Table 2). The checklist in Table 2 provides management teams a format for assessing the opportunities their organizations have to more effectively acquire and emulate the “winner” characteristics on a four-point scale (none, some, significant, great).

Most of the winner characteristics are self-explanatory. Two aspects of being an innovator seem particularly relevant: (1) the organization's past, present, and future innovation image in the marketplace and (2) future innovation opportunities and the commitment to remain or to become an aggressive market innovator.

The experimentation characteristic (#6) involves the number of experiments in process and, perhaps more importantly, the source of ideas for these experiments. Organizations that do an excellent job of attending to the fundamental needs of their associates accomplish a significant portion of their experimentations and innovations at the associate level rather than at the top- and middle-management levels. It is interesting that business winners are more effective at Thinking Like Customers (#8), Rewarding Performance (#9), and Leading by Example (#10) than their less successful competitors. These seem to be three important ingredients for future organizational success and are characteristics where improvement opportunities generally exist.

Actions

Which of the identified business winner characteristics provide your organization with the greatest opportunities? All business organizations have the opportunity to more effectively exploit one or more of these success characteristics. It is hoped that this checklist will provide you and your management team with a more focused direction regarding significant improvement opportunity areas.

Conclusion

We hope that this article helped you to become better informed regarding business winners and business losers. We invite readers to provide feedback (via email) on whether or not you agree with the authors' position on these agree/disagree statements.

Your comments and suggestions are always welcome and you may email us directly at wysocki@ufl.edu or respond via extension web page http://webct.nerdc.ufl.edu:8910/public/WysockiExtension/index.html.

Drs. Wysocki and Kepner are happy to lead a workshop on Business Winners and Business Losers.

References

Extension presentations led by Professor Karl Kepner.

Class discussions in AEB 4424 (Human Resource Management in Agribusiness) and AEB 5757 (Strategic Agribusiness Human Resource Management).

Tables

Table 1. Business Losers.

Business Loser Characteristics		Organizational Evaluation
		Very Descriptive	Somewhat Descriptive	Not At All Descriptive
Financial Poverty		_______	_______	_______
Managerial Short-sightedness		_______	_______	_______
Managerial Blundering		_______	_______	_______
Managerial Ignorance		_______	_______	_______
Managerial Cowardice		_______	_______	_______
Organizational Impersonality
	Associates (Personnel)	_______	_______	_______
	Customers	_______	_______	_______

Table 2. Business winners.

Business Winner Characteristics		Organizational Opportunities
		None	Some	Significant	Great
Innovation as a Way of Life
	Historically, Past-Record Image	_______	_______	_______	_______
	Future Opportunities	_______	_______	_______	_______
Create, Develop, Exploit Small Market Niches		_______	_______	_______	_______
Compete on Value Not Price		_______	_______	_______	_______
Develop/Communicate/Live a Strong Sense of Mission and Vision		_______	_______	_______	_______
Attend to Business Fundamentals
	Finance	_______	_______	_______	_______
	Associates (Personnel) and Customers	_______	_______	_______	_______
Encourage Experimentation
	How Many?	_______	_______	_______	_______
	Idea Sources?	_______	_______	_______	_______
Attack Bureaucracy		_______	_______	_______	_______
Think Like Customers		_______	_______	_______	_______
Reward Performance		_______	_______	_______	_______
Set Examples at the Top		_______	_______	_______	_______

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Footnotes

1. This is EDIS document HR 007, a publication of the Department of Food and Resource Economics, Florida Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida, Gainesville, FL. Published June 2001. Reviewed: September 2008. Please visit the EDIS website at http://edis.ifas.ufl.edu.

2. Allen F. Wysocki, assistant professor, and Karl W. Kepner, distinguished professor, Department of Food and Resource Economics, Florida Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida, Gainesville, FL.

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U.S. Department of Agriculture, Cooperative Extension Service, University of Florida, IFAS, Florida A. & M. University Cooperative Extension Program, and Boards of County Commissioners Cooperating. Larry Arrington, Dean.