What the CEO Wants You to Know: The Little Book of Big Business (Hardcover)

The book is organized into four parts.

In part one, you learn the universal language of business though concepts like inventory, product mix, merchandising, pricing, return on assets, customer focus, product quality, cash generation, growth, and finding out what you need to change from customers. The primary metaphor used here is that of a street vendor who is selling fruit in India and cannot afford to have a bad day. Dr. Charan fleshes out the examples by referring to his family's shoe business, and to decisions taken by leading executives he has worked with (like Jack Welch of General Electric, Jac Nassar of Ford, and Dick Brown at EDS).

In part two, he talks about how to use these concepts in the real world. His key point is to take the measurements and create a focus on 3 or 4 key activities that will make the most difference. He also relates this work to expanding the value of the company's share price.

In part three, he turns his attention to getting key tasks done. This involves putting the right people in the right jobs, improving group effectiveness (usually by putting in place activities that provide more timely focus), and how to lead change. Dick Brown is the key example in this last area.

In part four, you pay attention to what you need to do to aply these concepts to your own situation so you "become a businessperson first" in your approach to everything. This part gives you help with assessing the whole business, cutting through complexity, providing focus, helping others expand their abilities and synchronize with their colleagues to be more effective, and being a leader (regardless of your role now).

You are left then with the challenge of how you, the reader, can help the company make more money in the next two to three months.

The book is quite simple and can be read fairly quickly. I think that few will be confused by it. If you have questions, ask someone who has some business education to help you.

The book's great strength is its simplicity. It takes business concepts and approaches down to the lowest common denominator. For many people, this will provide a great advance over doing what is best for the way you are measured in your part of the organization. But you will have to get those measurements changed if you want focus and behavior to improve in a lasting way.

The book's weaknesses are in four areas. First, the street vendor and shoe company examples won't work for everyone. I suspect that a carefully drawn lemonade stand example would have worked better since almost everyone in the United States has either had one of those or been a customer of one.

Second, it is a little opaque from the material here how to find the key leverage points to improve the business. Talking to your customers will get their issues, but then what do you do next? This subject implies doing some systems thinking, and the basis for doing that work isn't laid here.

Third, the material on stock price improvement is weak. It also doesn't have any connection to a simple example. You are just expected to take his conclusions. It would have been easy to strengthen this section by extending the analogy of how a family that depends on a business feels when the business doesn't do well. I actually thought the Ford example was one of failure rather than success. Reasonable people will differ on these things.

Fourth, most businesses today need totally improved economic models rather than evolution of the ones they are using now. This book doesn't adequately surface that key point. In fact, the examples are drawn from companies that have done relatively little to change business models.

The person who will get the most benefit from this book will be the executive who wants to get her or his colleagues more involved in thinking like CEOs (and shareholders). You could take this book, and refocus it around simple examples that fit your business, and use examples of focus from things you are working on now. That would make this book extremely beneficial.

Help people understand what the issues are, how to think about those issues, encourage everyone to come up with better solutions, and make it simple and easy to experiment with new approaches. That approach can help you make progress much faster.

Take on the big picture!

The book is organized into four parts.

In part one, you learn the universal language of business though concepts like inventory, product mix, merchandising, pricing, return on assets, customer focus, product quality, cash generation, growth, and finding out what you need to change from customers. The primary metaphor used here is that of a street vendor who is selling fruit in India and cannot afford to have a bad day. Dr. Charan fleshes out the examples by referring to his family's shoe business, and to decisions taken by leading executives he has worked with (like Jack Welch of General Electric, Jac Nassar of Ford, and Dick Brown at EDS).

In part two, he talks about how to use these concepts in the real world. His key point is to take the measurements and create a focus on 3 or 4 key activities that will make the most difference. He also relates this work to expanding the value of the company's share price.

In part three, he turns his attention to getting key tasks done. This involves putting the right people in the right jobs, improving group effectiveness (usually by putting in place activities that provide more timely focus), and how to lead change. Dick Brown is the key example in this last area.

In part four, you pay attention to what you need to do to aply these concepts to your own situation so you "become a businessperson first" in your approach to everything. This part gives you help with assessing the whole business, cutting through complexity, providing focus, helping others expand their abilities and synchronize with their colleagues to be more effective, and being a leader (regardless of your role now).

You are left then with this challenge: "What are you going to do to help your company's money making in the next sixty to ninety days?

The book is quite simple and can be read fairly quickly. I think that few will be confused by it. If you have questions, ask someone who has some business education to help you.

The book's great strength is its simplicity. It takes business concepts and approaches down to the lowest common denominator. For many people, this will provide a great advance over doing what is best for the way you are measured in your part of the organization. But you will have to get those measurements changed if you want focus and behavior to improve in a lasting way.

The book's weaknesses are in four areas. First, the street vendor and shoe company examples won't work for everyone. I suspect that a carefully drawn lemonade stand example would have worked better since almost everyone in the United States has either had one of those or been a customer of one.

Second, it is a little opaque from the material here how to find the key leverage points to improve the business. Talking to your customers will get their issues, but then what do you do next? This subject implies doing some systems thinking, and the basis for doing that work isn't laid here.

Third, the material on stock price improvement is weak. It also doesn't have any connection to a simple example. You are just expected to take his conclusions. It would have been easy to strengthen this section by extending the analogy of how a family that depends on a business feels when the business doesn't do well. I actually thought the Ford example was one of failure rather than success. Reasonable people will differ on these things.

Fourth, most businesses today need totally improved economic models rather than evolution of the ones they are using now. This book doesn't adequately surface that key point. In fact, the examples are drawn from companies that have done relatively little to change business models.

The person who will get the most benefit from this book will be the executive who wants to get her or his colleagues more involved in thinking like CEOs (and shareholders). You could take this book, and refocus it around simple examples that fit your business, and use examples of focus from things you are working on now. That would make this book extremely beneficial.

Help people understand what the issues are, how to think about those issues, encourage everyone to come up with better solutions, and make it simple and easy to experiment with new approaches. That approach can help you make progress much faster.

Take on the big picture!

Donald Mitchell, co-author of The Irresistible Growth Enterprise and The 2,000 Percent Solution