Trust in the front line Tom Peters on Excellence

A HANDFUL of key ideas are transforming business. Here is my list of the top six, in reverse:

No 6. Total quality management. Superior quality is a must for competitive success these days. Problem is, everybody's doing it - the Indonesians, the Thais, the Argentines.

Though it is imperative, top-notch quality is no more than a player's pass into the stadium. Those who raise the TQM banner above all others are making a mistake.

TQM is about stuff that works, unerringly. A big deal? Yes. The whole deal? Hardly.

No 5. Re-engineering. Today's proponents of re-engineering match the zeal of yesterday's quality fanatics. And the idea is damned important. Decimating hierarchies via slash-and-burn strategies is one thing. Linking activities horizontally and reinventing key processes - that is, re-engineering - is quite another. Even revolutionary, as the gurus claim.

But it isn't the main game - at least as the game is usually played. Like TQM, re-engineering is mostly internally focused, such as streamlining. It is another necessary but far from sufficient weapon in the management arsenal for the 1990s.

No 4. Leveraging knowledge. Brains are in. Heavy lifting is out. Therefore the development of knowledge is close to Job One for corporations. Maybe one in 10 companies gets it and, of those few, only one in 10 is doing it right. The issue of the use of technology is 5 per cent bits and bytes (such as an e-mail system that spans continents) and 95 per cent psychology and sociology (an organisation that dotes on sharing information, rather than hoarding it).

No 3. The curious, cannibalistic corporation. In an increasingly crowded global marketplace, innovation is the sine qua non of success. Corporations desperately need an appetite for adventure, a passion for bold leaps into the unknown. That means hiring the bold and adventurous, even if they break a lot of china. It means shoving an exciting product on to the market even if it gores your current cash cow.

It means cherishing your failures. And it may mean chopping your company into firewood before the competition does. Stan Shih, the boss of Acer, to keep his Taiwan-based computer company fresh, will break it into 21 bits, then sell off majority shares of each piece to local nationals. Bravo]

No 2. The virtual organisation. It's the real thing, the umbrella that captures entirely new ways for people to work together across time and space.

The virtual corporation is the successful executive who brags of not having visited his own headquarters in the last five years. It is 'big' companies, booking billions in revenue, with literally a handful of full-time employees. Mostly, it's the idea that to own resources is a mistake - to succeed you need, instead, instant access to the best resources from wherever, whenever, to get the job - any job - done.

No 1. Trust. My latest book, The Tom Peters Seminar: Crazy Times Call for Crazy Organisations, included (heaven forbid) pictures - for example, of Virginia Azuelo, a housekeeper at the Ritz-Carlton Hotel. This prompted one visible advocate of re-engineering to ask a friend of mine: 'Why in the world did he do that?'

I did it because all this fancy management stuff boils down to (surprise) the folks who actually do the work - the ad copywriters, movie cameramen, nurses, technicians, teachers . . . and hotel housekeepers.

As so many annual reports mindlessly proclaim, people have always been 'our most important asset'. But now they are even more than 'most important', if that's possible.

Hierarchies are collapsing. We are asking the average Mary or Mike to take on extraordinary responsibilities. He or she may be on the payroll or, at least as likely, an independent contractor. In any event, the hyperfast-moving, hyper-wired-up organisation will rise or fall on the trust the remaining cadre of managers places in those on the front line.

In short, trust is the key to the other five transforming ideas. We get so caught up in TQM, re-engineering, innovation schemes, knowledge-management programmes and virtual organisations that, as always, we end up shortchanging that one person who actually makes it all happen.

Back to Virginia Azuelo. The Ritz-Carlton, winner in 1992 of the Malcolm Baldrige National Quality Award, has given Azuelo enormous autonomy to serve her guests as she sees fit. For example, she can spend up to dollars 2,000, on her own, to solve a customer problem. While the Ritz-Carlton may be a star practitioner of everything enumerated in this column, its success still comes down to Virginia Azuelo. Why did I put her picture in my book? Because, for crying out loud, she's the star of the new economy.

TPG Communications