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Hr Recruitments

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Siva Sivani Institute of Management. Secunderabad, Andhra Pradesh. Synopsis on the book review session of
‘In search of European Excellence’
Author- Robert Heller.

Reviewed By : Submitted to:
Basumitra Chakraborty, H406 . Dr. Lt. Col. (Retd) R. M. Naidu.
Date: 12/08/10 Ms. Sai Sireesha

About the author:
Robert Heller is one of the worlds’ leading authorities on management. He was the founding editor of Management Today and led it to number one position in Britain. He is the author of many acclaimed books like The Naked Manger, the Super managers etc. He writes monthly news letter with Edward de Bono, Letter to Thinking managers, and is a frequent visitor to management groups all over the world. He lives in North London , England.

Contents

1. Introduction 1

2. The devolution of leadership 1

3. Driving radical change. 1

4. Reshaping the Culture. 1

5. Mobilizing the motivators. 2

6. Making teamwork work. 2

7. Total quality management. 3

8. Self Evaluation. 3

9. Critical Appraisal. 3

10. Conclusion. 3

Introduction:
This book deals about the various management practices followed by various organizations of Europe. As management scenario is changing around the world and as a result new challenges are faced by these organizations, they have to adapt to the new rules of the game or make their own rules in order to stay ahead in competition. Otherwise even the big shot organizations risk their very existence. Robert Heller highlights this situation with various case studies in this book.
The devolution of leadership:
The devolution of leadership means delegation of power of a leader. It also means to cascade some of the powers of leaders to the subsequent levels of management. This would attach the employees to the organization in a better manner. The employees should be able to connect themselves with the organizations’ goals and objectives. They should participate in the decision making process of the organization. To achieve a vision of the company the people must be motivated to interpret and implement the vision.
All these aspects were evident in the success stories of ABB, ICL, and SGS Thomson which were discussed in the first chapter.
Driving radical change:
It takes up the classic example in Volkswagen during the late nineties. It talks about the indispensible concept of collective leadership exercised all the down the line. Here importance was given to evolving of efficient processes, Kaizen. It showed vividly that system that depends on one irreplaceable person is plainly and deeply defective. Though Volkswagen roped in the super successful CEO of GM to rake up profits and he even succeed in creating a new line of brands within a very short period and Volkswagen was expected to make great profits but reality was that it could manage marginal profits. This led the once great organization to rethink its strategies. An analytical approach towards the problem shows that it had serious problems regarding the processes. It means the processes were hefty, inefficient, and had huge production costs. Because of this it used to produce high cost cars in a low cost market and racked up losses. Thus, it was more important to reinvent the system than hire a ‘great man’.
Reshaping the Culture:
In 1995, Dialmer –Benz was experiencing losses for the first time in its 45 years. Even it could not pay the dividends this year. It was the symbol of enduring industrial might of Germany. So it could not afford to go like this and hence it took a major decision to sacrifice it’s all other diverse sectors and just to focus on its core business, ie cars. It had an image of of producing of luxurious executive cars and charging exorbitant prices. It had brought a rich prestige to the Mercedes marque and also rich profits. So ,it was the beautiful Mercedes cars to which Dialmer was looking as savior. Dialmer decided to go for a change of its image. They decided to go for broadly based manufacturing competing in every segment from top to bottom. This was gamble played by Dialmer and such a decision was unprecedented in the automotive industry. Cynics said that it could never change its image without tarnishing its glow. But they were wrong. The sales of Mercedes C Class had sold 314000 units whereas the older variant E Class only sold 200000 units. But to sustain this development something more needed to be done, that to change the rigid culture that Dialmer has been following from decades. With the rise of the Japanese and US the equations of production had changed and without efficient production they were doomed to fall behind. There was a big cry for a total change in approach from the top management. Efficiency is to be prioritized over productivity concerns. For a long term growth on revenue side, it is important that focus should be on not getting rid of people but getting more out of people. Thus, though there was a successful change in in the marketing culture of Dialmer but as part of change in working culture inside the organization still a lot needed to be done. World was waiting for Stuttgart to change.
Mobilizing the motivators:
In 1991, when Mr. John Smith was appointed as the chief of General Motors for its revival, he put his focus on the European plant for the task. He brought some changes that formed a platform on which motivation could be harnessed throughout the organization. The idea was to involve every level of worker in the realization of a project- to develop a new program called Omega. A new concept was adopted- ‘From bubble up to PAD.’ Here teams were formed that represented all the disciplines from production engineering and finance to marketing and service forming product development groups for all thirteen sections of the car. Every aspect of the car was a result of thorough research. At every step strategies were developed not by the top management but by the teams. They would brief in detail about their strategies to the top management and final approval was granted. Then it was totally the inputs and execution from the ground level teams up to PAD, ie, product at dealer, the final stage under the guidance of top management. Thus it engaged the worker, motivated them and also brought the best out of them to propel the organization to success.
Making teamwork work:
Quinn group was one of the best examples given this chapter. Feargal Quinn whose supermarkets ‘Superquinn’ in Dublin put him as a star in the international guru circuit believed in putting people first. But his people were his employees. He relied on total team performance. His team consisted of customers, employees and even his suppliers. He would engage his employees fully in customer service. He also used to put color photos of suppliers over the goods supplied by them with all details so as to create an atmosphere of trust. He used to follow reward system for employees. He conducted business on firm foundations that whatever enough profits they should be spread around the staff. Thus we can conclude that profits and growth are not an end but these financial benefits will follow from success in non financial areas like ‘customer service’ and ‘employee service’.
In this same chapter another example worth quoting is about the happy teams of Heinken, the giant beer company. Here they believe that the best culture for any organization is the strong team culture. People should not only work but also think as a team. They have a constant concern of how to strengthen the team culture more.
Total quality management:
Robert Bosch practiced total quality management long before anybody thought of it. He once said that ‘it has always been an intolerable thought to me that someone should inspect my products and find it inferior.” He had a penchant for quality production. For it started with good suppliers, because suppliers are the first link in quality chain. In order to instill passion for quality, quality principles are handed over to all Bosch employees and translated in all the languages spoken by its employees. It was Robert Bosch who set the standards for the whole German component Industry.
When many of the German organizations were lacking competitiveness, for Bosch it was never a problem. Cooperative and collaborative work by people committed to the cause and the company—which was the underlying principle of kaizen, was followed in Bosch.
Self Evaluation:
The book is excellent in content and shows how various management practices are put to practice in reality. It also shows how to adapt to the changing business environment. It has a compact and lucid description of profiles of most of the giant companies of Europe and thus is an asset for management students. Critical Appraisal:
As this book is heavy in content it demands for a deeper understanding from the readers’ part. So, for students who are in their beginning stages it is slightly difficult to comprehend all the aspects of the book.
Conclusion:
With a thorough study of the whole book we can conclude whether big or small, any organization falters and fades when it neglects any of the six basic management principles, ie, compete, lead the market, think big, be professional, innovate, defend bases and change. Obviously adherence to these principles are the secrets of success to any organization.
3

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