By Jack Stack, Bo Burlingham, Currency Doubleday, September 16, 2003, 0385505094
An extension of the Great Game of Business is that creating business is the game of business. Stack covers the history of SRC and its many subsidiaries. He doesn’t shy away from sensitive topics like disagreements he had with people and why. The theme is that business is about creating future opportunities by teaching people about what business is and what they get out of it if they are owners. Bo Burlingham, editor-at-large of Inc. Magazine. is co-author, and it’s a very readable book as a result.
The book defines 14 rules of ownership:
[p10] #1 The company is the product.
[p24] #2 A company isn’t worth anything if nobody else wants to own it.
[p43] #3 The bigger the pie, the bigger the individual slices.
[p58] #4 Stock is not a magic pill.
[p69] #5 It takes a team to build equity value.
[p78] #6 Failures are fine as long s they strengthen the company.
[p95] #7 Ownership needs to be taught.
[p118] #8 You build an ownership culture by breaking down walls.
[p134] #9 Getting out is harder than getting in.
[p148] #10 To maximize equity value, you have to think strategically.
[p165] #11 You create wealth by building companies, not by selling products and services.
[p203] #12 A company is only as good as its people.
[p204] #13 Ownership is all about the future.
[p258] #14 You gotta wanna. Here are some other quotes:
[p47] Trust is a key element of long-term business success, and you can’t have trust without honesty and openness.
[p166] You realize that there’s a log more money to be made in building and selling companies than in building and selling products. So you start searching for opportunities to start other businesses. What do you find? They’re all around you. THere are more than you can handle. You can’t believe you haven’t noticed them before.
What you need at that point is a formula that allows you to take advantage of the opportunities, preferably with resources you already have.
[p207] To one degree or another, the whole process of building an ownership culture is geared toward leading people to that epiphany [that you control your own destiny through ownership]. It isn’t easy. In effect, you’re asking people to make a fundament change in perspective, a leap of consciousness, and all kinds of things come along to block the message, as we discovered over and over again in the course of our journey.
[p208] Overcoming those obstacles is essential if you want to create a company of owners, but you need tools to get through to people. I’ve always found that the most effective tool is reality itself. […]
There are times, however when even a system like the Great Game of Business isn’t enough. Try as you might, you find that you can’t get through to people with facts, reason, and logic. The emotions are too intense. Communications breaks down.
[p214] I had a different idea of my role as a leader. My job, I thought, was to help people understand reality, and in busines the reality is that you are constantly facing threats, some of which you can identify, some of which you can’t. So you need an element of fear. You need to be aware of the real dangers that are lurking out there in the market and that could cost you your job if you’re not careful. Otherwise you won’t do what’s necessary to protect yourself and the people you work with. You’ll get complacent. You may even get arrogant. You’ll think you’re doing great because you’re generating a log of profit. You won’t realize how quickly the situation could turn around.
I do think Stack has become too enamored with what he has created. He even says so at one point in the book. In particular, the following quote shows that he values “community and culture” for their own sake, not the value they bring to the understanding of business and to the success thereof.
[p244] Having outside investors could change the whole thinking of the business. For one thing, the employees would not have a controlling interest in the company anymore. Under those circumstances, it might not be possible to preserve the community or the culture.
[p257] Nobody likes to leave the comfort zone. Most of us think, “Why mess with success?” We’ve been trained to believe that, if you work hard, everything will come to you. It’s one of the biggest fallacies our parents teach us: “Just keep your nose to the grindstone.” Then we’re caught completely unawares when the grindestone is replaced by something better and we suddenly can’t pay the bills anymore.