The lesson is clear: Strong leaders know that their people, their customers, and their suppliers are their most important assets and that they are totally dependent on them for success. They treat people with respect and are careful to make working conditions and relationships as positive as possible.
Gutsy Leadership Blog
The U. S. Postal Service (USPS) continues to spiral out of control, losing $26 Billion in the last three years. As reported in the financial press, USPS recently announced that starting next year it will lower its service standards, thus slowing down delivery. Employees have said publically that this move will “virtually eliminate overnight delivery – including first class mail – from one address to another within the same city or town.”
I recently got exposed to a company that has had a very tough time over the past five recession-burdened years. The industry they participate in has declined about 2% per year during that period, versus the average 4-5% growth that it enjoyed during the decade prior to the recent recession period. Given that the company is one of the few with premium priced offerings in their industry, once the recession hit, their business was hit even harder, with them losing market share each year, versus a prior decade of market share growth.
As reported recently in Businessweek, soft-drink sales started dropping in 2005 and have not stopped since (-19% over the past ten years). This is not surprising, given all the attention focused on discouraging soda consumption. For example, New York’s subway cars feature “drink yourself fat” anti-soda posters. The impact is real; Coca-Cola carbonated sodas fell 2 percent last year, marking the ninth straight year of decline. Diet Coke is being hit especially hard, dropping 7% last year, due primarily to the continuing health concerns about its artificial sweetener aspartame.
As we close out this year and set our sights on 2015, I think it is worthwhile to step back and think about the fundamentals of what it takes to lead a group to a successful outcome. In doing this, I am reminded of some work published 4 or so years ago in the Harvard Business Review that has really stuck with me. It was focused on uncovering THE key behaviors found in the experiences of others who have achieved success.
I recently read about a multinational company where the President of one of the product divisions was asked by the CEO of the company to attend a strategy meeting of the company’s executive committee (EC). He assumed that the EC was probably disappointed in his division’s weak results over the past two years and wanted to understand his plans for a turnaround.
Fortune Magazine did a major article on McDonald’s recently that was a real shocker in that it described a leadership crisis that has led to disappointments in the McDonald’s business on many different front. All of this has culminated in a disastrous year for the company. Specifically, in late October it reported its fourth straight quarter of negative same-store sales in its US operations and a 30% decline in the company’s profits. Expenses are growing while revenue are declining, a clear recipe for disaster!
Recently Harley Davidson, the Milwaukee-based motorcycle company, posted better than expected profits for the latest quarter, with revenue up 3.8 percent versus year ago. Over the past two years the company has done very well, with its stock price going from $39 per share two years ago to $68 per share range.
It was interesting to note that BHP Billiton, the world’s largest mining company as measured by market value, announced recently that it plans to split the company, spinning off BHP’s aluminum and magnesium business, plus several other smaller mining entities. The remaining, slimmed-down BHP will be focused on just four areas: coal, copper, iron ore and gas/oil.
Recently Tesla announced its July-September (JAS), 2014 quarterly results. Additionally, they explained that they now believe they will deliver 11,000 cars in the October-December quarter, not 13,000 as previously indicated. They blamed it on a two week production shutdown in July; raising some eyebrows, since such an event is planned well in advance.