Robert A. Lutz - Rules of Business
Robert A. Lutz served as a top leader of all the Big Three automobile manufacturers of United State. The following is his rules of business:
The customer isn’t alway right: Because customers do not always know what they want. Information collected from market research (for instance from survey, focus group) is not reliable, so making decision based on this information may be wrong and costly to the business.
The primary purpose of Business in not to make money: businesses run by enthusiasts who make compelling products or services that customer love and customers flock in to buy. Eventually, the businesses will make a lot of money, but the primary purpose of doing business is not to make money.
When everybody else is doing it, Don’t: business people should be brave to do differently and take a stand in the marketplace.
Too much quality can ruin you: customers may not want all the features of your products or services, and perfectionism may be prohibitively expensive that customers do not want to pay for the products. Be satisfied with some weakenesses in a product or service as long as the product meet the expectation of customers.
Financial controls are bad: it is about creativity, too much control can kill creative environment and leading to dismissal of potential ideas or products under development.
Disruptive people are asset: carefully observe and measure to distinguish who are right-brained – these people may have imagination that have hugely potential to the business, particularly in developing new products, processes.
Teamwork is’t always good: The chemistry of teamwork is complicated, many of them fail to churn out excellent outcome and wasted company’s time and money.
In M&A: be harsh to eliminate unsuitable people, structure and process that may be detrimental to the business. Otherwise the whole may be less than the sum of its parts.