5 Organizational
Disciplines
Advance Your Business with Discipline with AddingZEROS
How to Achieve Exponential Growth in Every Area of Your Business
Great companies are not born that way, they are the result of hard work, dedication, and time. The 5 Disciplines are simple principles that, in practice, will help your company succeed in serving your company’s key Constituents, and allow your company to become Sustainable, Predictable, Stable, Consistent, and be Emotionally Connected to your customers, your community, and your team.
Your organization strategy is your articulation of how you will win. It consists of two parts: where you want to go (your goals), and the roadmap that gets you there.. Mastering these disciplines makes your business Sustainable.Strategy is about skillful management that attains an end. And that end is more than margin, profit, or revenue — it’s sustainability: your business outlasting your competition and, ultimately, you. We call this winning.
Winning, or ensuring sustainability, is one of the prime duties of senior management of any organization. Winning becomes easier when leaders have a clear strategy to guide their decision-making process because a clear strategy defines how an organization will win.
A clear strategy provides a vibrant picture of what winning looks like for the company, and every department and every position.
EXAMPLE
Southwest Airlines
Southwest Airlines’ single-sentence strategy is “Wheels up,” a reminder that the company is only making money when its planes are in the air. Everyone works to keep the fleet on the ground for as short a time as possible. Pilots and attendants work with the ground crew to clean planes between flights. Passengers line up with no seat assignments and fill the plane as quickly as getting on a bus. All their planes are Boeing 737s, so crews and staff need to know only one type of aircraft.
Business Development goes well beyond sales. The more a business focuses on customers instead of sales, the more likely it is that the business will succeed. Mastering this discipline results in Predictability, the holy grail of business.
This discipline creates Predictability by focusing your company on people instead of profit.
It stands to reason that the more a business focuses on customers (who are creatures of habit) instead of sales, the more likely it is that the business will succeed. If you only focus on sales (profit), you’ll lean toward competing on price. But focus on your relationship with your customers, and not only will you learn what led them to buy from you in the first place, but you’ll also learn what keeps them (or could keep them) coming back.
In other words, instead of generating random sales through pricing structures, you’ll be adding zeros through your growing base of satisfied customers who like you and want to continue their relationship with you.
EXAMPLE
Airbnb
Airbnb is a go-between for travelers and hosts, charging hosts a 3% commission to rent their properties as short-term accommodations and charging travelers 6-12%.
Everything Airbnb does starts with its core customers. A comprehensive digital marketing strategy is centered around hosts and guests, leveraging their experiences. Airbnb encourages users to invite new members to try its services via email, a powerful referral tool, with referrers receiving a $25 travel credit when new members undertake their first trip and a $75 credit when they host for the first time.
Airbnb understands that when guests feel heard, they’ll advocate enthusiastically on its behalf, both online and off.
As a leader of business, you don’t build your business, you develop your people, and they build the business. When CEOs get this right, everything flows from there. This Discipline is all about Stability.
Your People Are Key to Your Company’s Stability.
A company that lacks stability in this discipline:
- is often distrusted by its staff;
- struggles to find the right people to hire;
- lacks clarity in defining the organization’s roles;
- has a team that works to the absolute required minimum.
An organization that is stable in this discipline has:
- high employee morale;
- a very high staff retention rate;
- customers and employees who are treated with the same respect.
So, the first thing to understand is that, as a leader of business, you don’t build your business, you develop your people, and they build the business. When CEOs get this right, everything flows from there. The second thing is that exceptional people build excellent companies. The third thing is that the People discipline is all about the stability of an organization.
EXAMPLE
Marriott International Inc
Marriott International Inc. understands that people are the foundation of a stable business because without the right people there is no business. And the people at Marriott have built a company with more than 6,500 properties in 127 countries and territories around the world, and revenues of more than $22 billion in the fiscal year 2017.
In 1927, J. Willard Marriott founded his company on this idea: take good care of the associates, and they’ll take care of the guests.
Marriott is an organization that is known as both a great place to work and a great place to stay.
At Marriott, a general manager’s average length of service is 25 years, exceeding the industry standard. Of the 361,000 people who work there, some 10,600 have more than 20 years of service. Marriott has also been consistently named one of Fortune’s best companies to work for.
Execution is about creating familiarity and a level of assurance that you have your act together, you’re in control, and you’re dependable. Mastering this Discipline creates Consistency in business.
Execution is Key to Your Company’s Consistency
There’s a general lack of consistency in businesses today among team members, departments and divisions, resulting in too much variation in customer interactions. This is extremely problematic for the sustainability of your company because today’s consumer demands reliability from your organization. Consistency provides familiarity and a level of assurance that you have your act together, that you’re in control, and that you’re dependable.
EXAMPLE
Holiday Inn
Holiday Inn was founded in 1952 by Kemmons Wilson when he was disappointed by the inconsistent roadside accommodations he encountered while on a family road trip from his home in Memphis, Tenn., to Washington, D.C. He decided to build his own motel chain that would be remarkably consistent in just about every way. This familiarity helps guests feel comfortable no matter where they are, which means they continue to use Holiday Inns for all their travel.
Mission is not having a great mission statement, but having a clear purpose that everyone inside and outside the company understands. This allows a company to create deep and lasting Emotional Connections with all stakeholders.
The Mission Discipline Is Key to Creating Emotional Connections.
EXAMPLE
Chick-fil-A
Chick-fil-A is an American fast-food restaurant chain specializing in chicken sandwiches. Headquartered in the Atlanta district of College Park, Georgia, since 1946, it is one of the largest family-owned businesses in America.
The Cathy family, which owns this company of over 2,000 restaurants, operates it based on Southern Baptist beliefs, closing on Sundays, Thanksgiving and Christmas Day. On its website, the company states its philosophy that “everybody’s job at Chick-fil-A is to serve: no matter our title or job description, our reason for coming to work is to generously share our time and talents. Whether it’s treating customers like friends, or serving our communities like neighbors, we believe kindness is a higher calling.”
And they practice what they preach. Chick-fil-A’s restaurant operators give away food year-round to those who need it most: local shelters and soup kitchens, to first responders and victims after a disaster. And they assist their own employees in achieving their higher education goals. Chick-fil-A employees are encouraged to volunteer on company time to pack meals for hungry children, tend to community gardens or help at food banks.
Chick-fil-A believes that working for them is about more than just serving chicken; it’s about having a positive impact in the local community.
