Good Profit: How Creating Value for Others Built One of the World's Most Successful Companies by Charles G. Koch

Author:Charles G. Koch
Language: eng
Format: mobi
ISBN: 9781101904138
Publisher: The Crown Publishing Group
Published: 2015-10-12T14:00:00+00:00

WALKING THE TALK

Although these principles may seem commonsensical, developing the ability to apply them routinely and instinctively to achieve results requires constant reflection and practice. As Voltaire noted, common sense is not so common.6

Many companies have principles somewhat similar to Koch’s Guiding Principles, but rarely are they the basis for a company’s culture. Very few companies take a systematic approach to making them central to every aspect of employment. Failing to do so ensures that the principles become nothing more than empty slogans, buzzwords, or posters on the walls, with managers often widely viewed as hypocrites.

At Koch we strive to hire and retain only those who embrace our principles. We give detailed explanations of our Guiding Principles and their role (investing a great deal of time and resources in mentoring and training), and clearly and consistently communicate the expectation that these principles guide employee behavior.

We ensure that opportunities, advancement, and compensation depend on how well an employee reflects our Guiding Principles. We also give regular feedback and will ultimately terminate employees who do not act in harmony with them. That’s how serious we are about ensuring our culture is based on principles.

For MBM to be applied effectively, results must be the focus. The challenge is to get beyond the superficial stage in which employees understand the words and concepts but haven’t yet been able to effectively apply them. Promoting those who cannot “walk the talk” undermines our ability to create value and damages the culture. Like chess players, we must apply the concepts and basic rules in a way that creates winning strategies. A key talent for leaders is the ability to identify people who are able to apply these principles to achieve superior results.

Whether or not you work for a company with guiding principles as explicitly codified as Koch’s, leaders should be selected from among those who have not only demonstrated the ability to understand and apply these principles, but who are positive role models for workplace culture. Because leaders set the standard—both by how they lead and by what they do—they are the guardians of, and must be held accountable for, the culture. To be effective, leaders must internalize and consistently apply those principles in a way that produces results.

Creating a beneficial culture is impossible without mentoring and positive examples. At Koch, good leaders not only live by our Guiding Principles; they regularly review them with all employees. In any company, the most effective leaders are those who provide frequent and honest feedback that identifies opportunities for improvement in a way that stimulates dialogue and change. They hold themselves, their employees, peers, and management accountable.

The importance of culture and leadership are well illustrated by another great coach, Jack Clark, the rugby coach at the University of California. To my knowledge, Jack has the best long-term record in intercollegiate sports. In his thirty-one years as coach he has won twenty-two national championships. For him, as for us, culture is key:

We as a team are our values. We use them daily as a touchstone to help inform every decision we make.

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