This
is how-to, practically oriented book, dealing with a very important topic. Its
main merit is that it will force managers who read it to reflect on something
that, while considered essential, rarely gets the necessary attention, buried
by the day-to-day pressures of the job - the values of the company.
The
Committed Enterprise makes a serious effort to show how a clear vision, sustained
by strong values, is necessary for the company's long-term success. Even more
interesting, it stresses the need for consistency between the vision, the values,
and the needs and desires of all key stakeholders, especially customers. Finally,
a strong point of the book is its effort to help readers to actually implement
those values, through measurement and reappraisal.
Yet Davidson's work
has some weaknesses, some of them almost intrinsic to the topic, other specific
to the book.
Linking values to business success in a meaningful way is
bound to be difficult: there are simply too many different circumstances, and
using concepts such as "Key Success Factors" or "customer orientation"
is plagued with tautologies. Of course, successful companies are those that manage
their KSF well, but this is true because KSF are implicitly defined as those things
companies must manage well to be successful. We don't know ex-ante which ones
those are, and how they should be managed.
As with many books on these
"soft" issues, a problem of Davidson's work is its frequent disregard
for economic realities. Successful companies may be so because of their visions/values,
and unsuccessful ones may be unsuccessful because of their lack thereof. But there
are many other dimensions, extremely important, such as monopoly power, barriers
to entry, regulatory hurdles, etc. To say that Microsoft is successful because
it is "customer-oriented" will seem odd to more than one Microsoft customer
(and to anti-trust authorities in the US and Europe, which have found the company
guilty of abusing its monopoly power).
In fact, much of the book is a
bit lame. Indeed, who could be against strong values and clear visions? But it
does not address the most serious problem of value-based management: it is not
that companies do not proclaim values, but that, when real managers face real
tradeoffs between the grandly proclaimed values and short-term financial pressure,
they go for the second. The book "solves" this ultimate problem by stating
that "the best approach is never to trade-off vision and values against short-term
pressures". And that's it. That Percy Barnevik may be cited as an authority
on values, when he ran away with more than $100 million as a non-board approved
"pension" payment, leaving his company, ABB, in serious financial straits,
shows how far the official statements can be from the personal actions. To my
mind, this is the most common problem leaders face when trying to infuse values
in an organization: not that they lack an understanding of how important values
are, but a lack of personal integrity to see them through against short-term pressures.
Having said this, "The Committed Enterprise" does provide useful
clues on how to actually instill values in the organization and get its members
to make the vision theirs. This practical bent is probably the book's most useful
feature, and may make the value valuable for managers grappling with the difficult
issue of infusing their organization with meaning.
