‘In Search of Excellence’ is a 1982 business management book written by Tom Peters and Robert H. Waterman Jr. about key characteristics of successful companies. ‘In Search of Excellence’ was a bestseller when it was first published, and it remains an influential book on business management today.
The book’s principles are as relevant today as they were in 1982, and they can be applied to businesses of all sizes and industries. Here are some of the key takeaways from ‘In Search of Excellence’:
- Focus on the customer.
- Empower your employees.
- Invest in your people.
- Keep things simple.
- Be flexible and adaptable.
Tom Peters and Robert H. Waterman Jr. use them as a starting point for identifying and examining other relationships.
Principles of successful companies according to the book ‘In Search of Excellence’
Based on a study of 43 of America’s most successful businesses, the book identifies eight key management principles common to these companies. These principles are:
- A bias for action. Active decision making of ‘getting on with it’. Successful companies are characterized by a willingness to take risks and experiment. They are not afraid to make mistakes, and they learn from their failures.
- Close to the customer. Learning from the people served by the business. Successful companies have a deep understanding of their customers’ needs and wants. They are constantly seeking feedback from customers and using that feedback to improve their products and services.
- Autonomy and entrepreneurship. Fostering innovation and nurturing ‘champions’. Successful companies empower their employees to take ownership of their work. They create an environment where employees feel like they can make a difference.
- Productivity through people. Treating rank and file employees as a source of quality. Successful companies recognize that their employees are their most important asset. They invest in training and development for their employees, and they create a work environment where employees feel valued and respected.
- Hands-on management. Management philosophy that guides everyday practice – management showing its commitment. Successful companies have a strong management team that is actively involved in the day-to-day operations of the business. The management team is visible and accessible to employees, and they are always looking for ways to improve the business.
- Stick to the knitting. Stay with the business that you know. Successful companies focus on what they do best. They avoid distractions and stay true to their core competencies.
- Simple form in a complex world. Simple form, lean staff. Some of the best companies have minimal staff. Successful companies have simple organizational structures and decision-making processes. They avoid bureaucracy and red tape.
- Simultaneous loose-tight control. Autonomy in shop-floor activities plus centralized values. Successful companies strike a balance between giving employees autonomy and maintaining control over the business. They have clear goals and expectations, but they also allow employees the flexibility to innovate and experiment.
The principles of the model are that all the elements are equally important while being inter-connected, hence altering one element affects other elements.
Additional features of successful companies
Effective strategy is more than individual subjects. It is the relationship between strategy, structure and systems coupled with skills, style and super ordinate goals. Business managers need to find a way of examining an organization’s operation, its inter-relationships and core competencies. They must have a checklist of important variables for evaluating the proposed strategies (coherence).
The use of matrix project teams has been championed by Tom Peters and Robert H. Waterman Jr. Business organizations need flexible structures that remove as much bureaucracy as possible by getting rid of as many rigid rules and regulations as possible. The use of project teams should lead to more innovative and creative ideas as staff will be more motivated to contribute.
In summary, by following these eight principles of successful companies, businesses can increase their chances of achieving excellence.
