Management in 10 Words by Sir Terry Leahy
Yorkshire Powerhouse Score: 8/10
Terry Leahy joined Tesco back in the 1970s at the age of 23 – back then it was struggling to find its place in the UK retail scene. Sainsbury’s and Marks and Spencer were leading the UK market with clear dominance and Tesco was floundering.
When Sir Terry left in 2011 after 14 years as CEO, the business was the third-largest retailer in the World with 6,000 stores in 14 countries. In this book, Sir Terry looks back on his experiences in Tescos and condenses his observations into 10 words that form the essence of what led to the transformation.
Sir Terry is notoriously private, a classic Level 5 leader (attributing the successes of the business to his colleagues) who seeks simplicity and basic values over the latest trend and describes himself fundamentally as an optimist. Indeed, when speaking to the Civil Service after his exit from Tesco, sharing his experiences at Tesco, Leahy explained ‘how’ Tesco did it with the following few words;
“We focused on relentlessly delivering for customers. We set ourselves some simple aims and some basic values to live by. And then we created a process to achieve them, making sure that everyone knew what they were responsible for.”
That’s it … apparently. Fortunately, Leahy was persuaded to expand on his statement for this book or it would have been an extremely short read!
The 10 words themselves are not actually that important … but the stories, logic, experiences and formation behind them provide the detail and context to the reader and with little effort can be applied to any business, large or small.
According to the author, organisations are terrible at judging or facing the truth, with management screening and filtering out the news they don’t want to hear! Accepting the truth generally means having to then apply change, and ‘change’ is normally hard and something to be avoided.
Winning and retaining loyalty is the single best objective any business can have … loyalty from and to the customer (obviously) but also loyalty between colleagues, managers, investors, etc.
Having the courage to aim high with audacious goals and ambitions that form part of your vision, based on using facts and values to underpin achievement and give certainty. An interesting motivator for Terry Leahy is the fear of failure.
Underpinning all decisions in corporate life by allowing your fundamental values to create the logic is essential. This includes allowing these same strong values to support decisions in management, personal life, emotional dilemma’s, local demands, etc
Plans are worthless without action and implementation.
Inspired by Caplin & Norton, Leahy introduced the ‘Balanced Scorecard’ system into Tesco to initially provide 4 measurable aspects of performance across the business. This eventually evolved into 5 aspects but the concept of keeping the number of KPI metrics tight and clean is essential.
Leahy states, “Bureaucracy has a tendency to dissipate knowhow!”. Throughout this book, Sir Terry is clearly on a constant search to simplify all aspects of the business – only 6 layers of management from the shelf stacker to the CEO, for instance. Sir Terry (and the entire senior management team) learnt more in one week a year by working at all levels in a real-world store with the relentless goal of, “What can we STOP doing?”.
Go ‘lean’ and do more for less is the Tesco way. The author is accepting that to stop using ‘resources’ is an impossible dream … but this doesn’t mean you can’t achieve colossally more for the same set of resources used.
Interestingly, Sir Terry lists Walmart and Aldi as his two most formidable competitors, based mainly on their scale and ability to genuinely disrupt the market. In response, he believes that the constant monitoring of your competitors (perhaps underpinned by his fear of missing an opportunity and failing to monopolise) helps you understand improvements, better approaches, new market opportunities, etc.
The author uses trust in place of ‘Leadership’ and bases this on the statement that, “Trust is the bedrock of leadership.” A trusted leader takes a team further than the team would take itself.
Who will gain the most from reading Management in 10 Words?
Any business leader looking to find the foundations for a genuine long-term business strategy, any young ambitious and budding manager who doesn’t want to fall foul of trends and fashions in the classic World of the MBA.
Could a Yorkshire perspective improve this book?
Sir Terry is a genuine Northerner, born and bred in Liverpool with a character formed by a set of good, old-fashioned values of decency and honesty. He’s virtually a Yorkshireman, he tells it so straight. Just wait for the section when he shares his opinion on the egotistical, ‘TV ratings chasing approach’ of more ‘brash’ business leaders who love shouting across a boardroom table that, ‘You’re Fired!’ and who actually erode trust and respect and are therefore weak leaders. Truly a ‘slam’ worthy of Sir Terry Leahy!
Keep your strategy simple, true, clear and communicated. Book Reviews, Yorkshire Powerhouse
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