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Bill Gates: Flawed Vision

Bill Gates is currently the richest man in the world. Whilst Pocketblog is about business and management, this fact is relevant. As is the fact that he is cofounder of the wealthiest charitable foundation in the world; The Bill and Melinda Gates Foundation. All of this has come about thanks to three characteristics: fearsome intellect, relentless focus on financial growth, and a penetrating – though sometimes partial – vision of the future.

Bill Gates

William Henry Gates III was born in Seattle, in 1955. He was a precociously intelligent child, reportedly reading a complete encyclopaedia by the age of 10. However, it was as a 13 year old that his path was set. At his prestigious private school of Lakeside, he co-founded a computer club: the Lakeside Programmers Group. There he first met future Microsoft co-founder, Paul Allen.

Visionary Coup Number 1: Gates was impressed by the computer’s relentless ability to execute instructions and determined to study and master it, as a route to wealth. (Of course, he was not alone in this)

During his time at school, Gates’ programming skills progressed from writing a simple Tic-Tac-Toe program (Noughts and Crosses, in the UK) to traffic control systems and a school timetabling program (that incidentally put him in the classes with the most interesting girls – although he seems to have spent most of his time with the computer!).

Gates’ parents saw his future career – like that of his father – in the law and he went to Harvard Law School in 1973. However, he sent more time in the computer department, where he met his other long-time Microsoft partner, Steve Ballmer. But it was with Paul Allen that Gates founded Micro-Soft in 1975 – renamed without the hyphen a year later. They pursued an opportunity to write code for the new Altair 8800 computer, aimed at hobbyists. By 1977, Gates had dropped out of Harvard, with the blessing of his parents.

Visionary Coup Number 2: Gates saw early circulation of his software among hobbyists as what we would now call piracy and wrote trenchantly defending the right for software writers to make money from their work. (Of course, others shared that conviction)

His biggest visionary coup originated in a request in 1980 from IBM (then an absolute colossus) for Microsoft to create a BASIC Interpreter to allow users of its new Personal Computers to write programs using the popular language, BASIC. They also mentioned the need for an operating system.

When IBM and the company Gates recommended failed to reach agreement, Microsoft stepped in and offered to create an operating system. They did so, by buying the exclusive rights to an existing OS, and adapting it. But his genius vision came next…

Visionary Coup Number 3: Gates saw that IBM’s PC model would be copied, and every new computer would need an operating system. So he sold IBM the right to use his OS, but retained the copyright for Microsoft.

Soon, every PC or PC clone had Microsoft’s MS DOS as its interface with users. It rapidly displaced a host of competing operating systems. In 1985, Microsoft evolved the command line OS into a new paradigm (championed by Apple) – that of a graphical user interface that they called Windows.

In the 1980s too, Microsoft began massive investment in buying up and developing the software that workers would need to do their day-to-day office tasks: word processing, working with numbers, creating databases, and producing  presentation slides (are you old enough to remember hand-drawn transparencies?).

Visionary Coup Number 4: Gates saw that PC would only be a compelling must-have tool, if it could be used by everyone to do the things everyone needed to do. Microsoft now calls this suite of tools Microsoft Office.

It was in the mid 1990s, that computer use started to shift rapidly, with the growth of the internet. Where was Gates on this?

Visionary Flaw Number 1: Gates failed to anticipate the rise of the internet and Microsoft was blind-sided by the rapid growth of Netscape, who produced the first mass-market (and free to use) browser.

Microsoft’s response was to buy a company that had a browser of its own, and then develop it into the first incarnation of their own Internet Explorer. Now, Gates’ ruthless commercial sense clicked in. He bundled the tool in with his ubiquitous OS, so that PC users would find Microsoft’s browser the easy-to-use default. This triggered a series of anti-trust battles in the US and European courts, at the start of the century.

Despite being ordered to split Microsoft into two companies at one stage, Gates fought back, vigorously defending Microsoft’s competitive dominance. He succeeded. If there is another visionary flaw, the question is whether it belongs to Gates or to Microsoft. In 2006, he started to transition out of his full time role at Microsoft, stepping down from the role of Chairman in 2014. However, he did retain the role of Technology Advisor. I think though, that he was still a dominant mind when Microsoft failed to spot another trend…

Visionary Flaw Number 2: Gates failed to fully appreciate the importance of mobile computing and smart phones. The early phone operating systems were clunky and Microsoft ceded dominance of handheld device computing to Apple and Google/Android.

There is a lot of catching up going on now and who can foresee the future of computing in the absence of giants like Steve Jobs (now sadly deceased) and Bill Gates (now largely out of day-to-day technology leadership)?

By the way, some would point to a third Visionary flaw – Microsoft’s failure to spot the importance of search and the very late arrival of its Bing service into competition with Google. I don’t, simply because I don’t think this service was ever at the core of Microsoft’s vision. Whether it becomes so, is a decision for its new and future leadership.

From 2000, when he and his wife set up the Bill and Melinda Gates Foundation, Gates has increasingly devoted his time to philanthropy. It is now his major activity. He is committed to handing over half or more of his wealth to charity and has huge vision for what that wealth can achieve.

Visionary Coup Number 5: Gates has re-ignited the fervour of modern American billionaires for philanthropy, in the mould of early twentieth century leaders like Rockefeller and Carnegie. And his vision for how to spend that money is inspired by careful research and a dedication to making a real difference.

I know our readers like business and management advice, but the fact is that Bill Gates’ business and management acumen was always focused on a ruthless drive to make technology a source of massive profit, and it is now focused equally relentlessly on a few global initiatives of scale and importance. The primary lesson we can learn is simply of focus.

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Walt Disney: Vision and Dreams

It’s Christmas in two days (from publication of this blog). So who could be a more appropriate management thinker than…

Walt Disney was perhaps the most visionary business leader of the twentieth century. He grew a simple cartoon character into a vast empire, which sells one thing: dreams

Walt DisneyBrief Biography

Walter Elias Disney was born in 1901, in Chicago, but he grew up on a farm in Missouri. From the earliest age, he was constantly sketching.When the family returned to Chicago while Disney was in his teens, he focused his education on drawing, and studied art in the evenings.

During the First World War, Disney was keen to serve, but failed to demonstrate that he was old enough. Instead, he joined the Red Cross and, at the close of the war, drove ambulances in France. After the war, he had several attempts to create a career from cartooning, and taught himself to make animated films  quickly discovering that painted transparent cels gave better effects than cut-outs. After one failed business (that failed by paying its animators more than he could sell the films for) he moved to Hollywood and, with his brother Roy, set up Disney Brothers Studio.

He continued to innovate technically, basing his technique on his earlier discovery and artistically, inventing his stand-out character creation Mickey (originally Mortimer) Mouse who featured in the world’s first sound cartoon, Steamboat Willie, in 1928. The next innovation was to use Technicolour for cartoons, with the Silly Symphonies series, but the big hit was when Disney placed $2 million at hazard – a huge amount in the middle of The Great Depression – by making the first ever full length animated feature film, Snow White and the Seven Dwarfs.

This won an oscar for the Best Picture (actually, one oscar and seven mini oscars – another first) and labelled Disney as a creative genius. More animated movies followed, all now seen as classics: Dumbo, Bambi, Pinocchio and Fantasia. Then came the war and a series of animated propaganda movies that it is hard – if not impossible – to find copies of.

After the war, the stream of feature movies resumed, but Disney also turned his attention to a new vision: theme parks. First came the Disneyland Theme Park in Anaheim, California, followed by Disney World in Florida, opened in 1971, five years after Disney’s death in 1966.

Lessons for Managers

By all accounts, Disney was a flawed manager at best, frequently leaving contributions unacknowledged and imposing arbitrary rules without exception. Not all his rules were arbitrary, however – the injunction against swearing upheld the wholesome brand image, and not all were without exception – Disney did not impose his rule against facial hair for men upon himself.

What we can learn are 5 valuable lessons.

1. Vision means Vision

We all too often read or hear a company’s vision statement. All to rarely do they have any sense of vision: of visual impact. Disney constantly used imagery to illustrate what he could see, to help others to see it too. Famously, Roy Disney commented that, on the completion of Disney World, Walt Disney had already seen it when he died, even though it was far from completion.

2. Vision is nothing without Drive

Visionary he may have been, but Disney also had the determination, tenacity, and at times ruthlessness to make his vision a reality. It is also worth mentioning how uncompromising he was in ruthlessly demanding the very best work from his artistic staff.

3. Less is More

It seems an odd comment to make of the man who invented feature length cartoons, but the sheer amount of ideas that Disney abandoned in every one of the films he personally oversaw was staggering. In modern times, they would have filled a box set of DVD extras. And much of it was extremely good – just not good enough for Disney.

4. Protect the Brand Values

Everything Disney did – and much of what it still does – is to protect his vision of what the Disney brand means: dreams. Where modern managers and artistic directors have strayed, huge rows have ensued. As the father of a young girl, the power of Disney to evoke wonder seems to me to be as great today as it ever was.

5. Creativity is Hard Work

Disney and his teams worked hard at being creative. It was a constant struggle of ideas, discussions and culling of anything less than the very best. And then more ideas, more discussion and more culling. Disney the dreamer was half of a split personality. The other half was Disney the critic.

If you are interested in Creativity, you might like:

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A Tale of Two Budgets

The Management Pocketbooks Pocket Correspondence Course

This is part of an extended management course. You can dip into it, or follow the course from the start. If you do that, you may want a course notebook, for the exercises and any notes you want to make.


There was a time when the now traditional budgeting process did not exist. It emerged in the early twentieth century as a mechanism to exert central control on increasing large corporations with more and more regions and divisions. It put the power at the centre and constrained senior management in the regions and divisions to comply.

We looked some time ago at the triptych of mission, vision and values. Once these are agreed, senior managers can develop a strategy for the business and, from that, plans for the coming year. When costs and revenues are allocated to those plans, the costs can be divided among the regions, divisions and functional groups, to create a budget.

Budgeting is therefore a process that reinforces a static hierarchy, centralised control, and a fixed plan for the coming year. It happens in the overwhelming majority* of businesses; including Barnstaple Corp, a fictional US headquartered global manufacturer.

Barnstaple Corp

This results in Barnstaple having a high level of control over how and where it spends its investment money – able to channel cash to the regions and operating divisions where HQ analysis can see the great growth potential. Down on the ground, however, individual managers who are responsible for distinct product lines feel frustrated. They have very little true decision-making capacity and are forced to manage their business with no more resources than they are given.

Some can see huge local opportunities, which they are unable to exploit due to lack of central funding. It is not that budgets cannot be adjusted mid-year; but the effort, bureaucracy and politicking required to negotiate this with HQ leaves many of them with a fatalistic attitude. They know that if they were given more autonomy, they could make more money for their bosses, but they feel as if nobody really cares about the profits of their one product line.

Idlas

Idlas works very differently. It is a fictional European headquartered retailer, that gives everyone of its employees in 24 countries a simple message: continually find and implement ways to serve our customers better. Anyone in the business can make a decision and primary levels of leadership are devolved to clusters of stores of no more than 50 to 60 branches. Headquarters serves as a resource pool for company-wide services, but individual senior managers at cluster level can opt out of those services if they can find alternatives that allow them to provide better service to their customers.

All decision-making at Idlas is governed by a few over-arching corporate values and promotions tend to be internal, locking those values into the company’s DNA. To support decision-making, HQ provides a constant stream of high quality information, that is openly available to any manager.

Similar and Different

Both Barnstaple and Idlas are highly admired companies making large profits for their shareholders. Both have very real equivalents in the world – each on both sides of the Atlantic, although the Idlas equivalents are far rarer than the Barnstaples. Both are extreme and idealised counterparts of their real-world equivalents – yet neither is very far from the reality of typical businesses of their type.

But both have a very different response to the VUCA** environment in which most large corporates are trading – and in which most small businesses trade too.

Barnstaple husbands its resources carefully, using centralised expert analysts to predict where they will be needed and a budgeting process that allocates them accordingly. Scrutiny of requests for budget variances happens centrally.

Idlas lets local managers read the local conditions and optimise as they go, drawing down on central resources, to invest what they judge necessary to maximise customer service and therefore profit.

Scrutiny takes place far more locally than at Barnstaple, among peers in the region.


* I am tempted to say 97.6 per cent of businesses, knowing that 98.3 percent of statistics are made up and that only 1.4 per cent of readers ever try to check a statistic and that only 21.2 per cent of them are ever persistent enough to get an answer. But I shan’t, for obvious reasons.

** VUCA: Volatile, Uncertain, Complex, Ambiguous

Further Reading

Barnstaple represents the archetype of command and control budgeting, whereas Idlas is emblematic of a devolved leadership model.

You can learn more about this from the Beyond Budgeting Institute.

You may also like The Managing Budgets Pocketbook.

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Project Lifecycle

The Management Pocketbooks Pocket Correspondence Course

This is part of an extended management course. You can dip into it, or follow the course from the start. If you do that, you may want a course notebook, for the exercises and any notes you want to make.


Implementing business strategy usually means starting one or more projects. Whilst nothing would please me more (as a former professional project manager) than to devote a series of blogs to a thorough description of project management, that is not the role of these blogs and also, The Project Management Pocketbook already covers that ground.

So I shall limit myself, in the next few blogs, to some of the essential models that a project manager will need. We will cover:

Once the dates are passed, these links will work.

Four Stage Project

There are as many ways of representing the lifecycle of a project as project managers, but they all contain many of the same features, just different language for the stages, different choices of how detailed to be, and different graphical metaphors for how to draw it.

Here, we will use the version in the Project Management Pocketbook.

Project Lifecycle

Scoping

Define the purpose, aim, objectives and scope of the project to evaluate whether it makes good business sense and is therefore worth proceeding to the planning stage. Good business sense here means consistency with your organisation’s mission, vision and values, and a reasonable expectation that the benefits will exceed the costs.

Planning

Put together a detailed specification for what your project will produce and then use this as the basis to plan what you need to do, in what order, at what time, with what resources and allocating work to which people. Calculate the cost of your plan to create a budget and compare that with the benefits you will get if your project delivers to its specification and you can create a business case. You business case will guide your decision whether to invest in implementing your project.

Implementing

Now deliver your project, constantly monitoring for risks, changes, delays, overspends and the quality of your delivered products. Intervene where necessary to maintain control. At the end of the implementing stage, you can hand over the last of the things you have created to your customer, boss or client. Will they accept them? Only if they are fit for purpose.

Evaluating

How did it go? What did you learn? How did team members perform? Was it all worthwhile? Take this new knowledge into your next project and do that one even better.

Further Reading 

From the Management Pocketbooks series:

  1. Project Management Pocketbook
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Mission, Vision and Values

The Management Pocketbooks Pocket Correspondence Course

This is part of an extended management course. You can dip into it, or follow the course from the start. If you do that, you may want a course notebook, for the exercises and any notes you want to make.


Among the most frequent sources of confusion for managers – at all levels – are the distinctions between mission, vision and values.

As I started planning this article, I created a table for myself, to put my ideas down about how they compare. In the end, I decided that, if a picture is worth a thousand words, a table must be worth at least 500.

You can click on this image to get a full screen version of this table.

Mission, Vision, and Values

There is not much more to say

Your mission is a long-term definition of why you are in business, your vision sets out what you want to achieve within your strategic planning timescale, and your values determine the culture, behaviours and choices you want your business and its people to follow.

Values should drive your culture through every process: recruitment, appraisal, promotion, succession, procurement, development, sales, marketing, …

Mission should set up the basis for your values. Mission and values should help you find which of many possible visions is right for your business.

Mission, vision and values: one of those things that is fiendishly simple in concept, yet staggeringly hard to do well.

Further Reading 

From the Management Pocketbooks series:

  1. The Strategy Pocketbook
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