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Ram Charan: The Business of Security

Lynn Mattice, CSO of Boston Scientific, quizzes the man Fortune magazine calls "the most influential business consultant alive" about how security executives can better serve the business

By Sarah D. Scalet

Page 5

Charan: Yes. So once again we go to the same principle. Know the business.

Mattice: You think it's going to be much more complex than this.

Charan: It's not. It's really not.

Mattice: One of the things that I've seen over the years is that as new approaches come forward—whether it's lean manufacturing or TQM or Six Sigma—people throughout companies normally tend to throw somewhat of a jaundiced eye on these things because they look like the management's program of the month. What is your view on the best way to implement change within an organization and put new programs in place?

Charan: The first thing you ought to do is recognize that these are tools. If they are not used as tools, they become a fad. First you need to define what need or problem you're solving for the business, and for that need or problem, you decide what tool you're going to use. You convince the people of the need or the problem or the opportunity, and then have them engage the tools that are best suited. Train the people on the tools. When they're committed, you will see the change.

Six Sigma is a fad, if you don't answer the previous question. So you have a [Jack] Welch [former CEO of GE] coming into Six Sigma—and Larry Bossidy [coauthor of Charan's book Execution and former CEO of Honeywell International] actually persuaded him to do that—but he saw Six Sigma as a huge tool to streamline processes, particularly with customers. That had a huge impact on eliminating waste, creating common systems and processes, thus requiring and resulting in better margins, better profits, and more importantly better service. He defined the need or problem or opportunity, then he searched for a tool, not the other way around.

Mattice: OK. It's not trying to pick up the tool and force it into the environment....

Charan: You will fail on that.

Mattice: How do you find the right tools?

Charan: You search today on the Internet. You say, this is my problem; what are the tools? There's so much written about these things coming from various parts of the press. Or just call a consulting firm; they will tell you that. Or Harvard Business Review. If you don't find them in those places, then you search. For example, in 1990, the CEO of American Standard, Emmanuel Kampouris, toured the world to find the tools of what became lean [manufacturing]. He had a debt problem, and he did not want to sell the pieces of the business. But he could generate cash by changing the production systems and creating high inventory turns. He went all over the world, and he found a guy in Colorado who knew what was "just in time" [manufacturing] and how to do that. It's no different from anything else. People search for new ideas, new tools.