Tom Peters’ EXCELLENCE. The Basics. Now More than ever. PCBC2008 27 June/George Moscone Center

1. Tom Peters’ EXCELLENCE. The Basics.Now More than ever.PCBC200827 June/George Moscone Center

2. NOTE:To appreciate this presentation [and ensure that it is not a mess], you need Microsoft fonts:“Showcard Gothic,”“Ravie,”“Chiller”and“Verdana”

3. Note to Readers not involved with the PCBC2008* and the California residential real estate industry: Obviously, times are tough for these folks. (I was explicitly asked to speak on “excellence in adverse circumstances.”) And the tougher the times the more important the need for a little humor and flippancy to accompany one’s otherwise sober message. Moreover, despite my residence in Vermont, I spent 35 adult years in California, mostly in NCal, but also in SCal. My fondness for our great state-republic is infinite—as is my comfort among Californians. Hence there is an “insider” character to the start of this presentation, and a tone that comes from overwhelmingly feeling among friends—and also, probably, some indecipherable shorthand. The immediately following 4 slides were the basis for almost all my remarks to PCBC2008 … *Pacific Coast Builders Conference

4. Off The Top Observations, With Prejudice **Angelo Mozilo is a big fat jerk.**Ken Lewis is a fool. **Where is A.P. Giannini when we need him? **Barry Bonds was the best natural hitter ever.**That which goes up also comes down. (That assertion alone is worth the price of admission.)**That which goes waaaaaay up also comes waaaaaay down. (“It was in the Beginning and now and ever shall be. Amen.”) **IQs rise as markets go up. (Isn’t it amazing how smart we all were 18 months ago?) **Why have we done this s%^# over & over & over?**Why will we do this s%^# again & again & again? **The “madness of crowds” is the most profound statement of truth ever. **My Dear Old Dad’s preference for real estate over stocks still suits his son. **Dollar for dollar, landscaping is the premier source of value added to residential property.

5. **Bigger is almost never better. **Big mergers are stupid. **Big mergers spring naturally from big egos.**Carly Fiorina saved HP.**Malcolm Gladwell gives good hair.**I miss Bill Walsh.**San Francisco is the greatest city in the world—and LA ain’t all bad (neither is-are Oxnard-Port Hueneme).**It doesn’t get any better than this—U.S. Grant, Abraham Lincoln and John C. Fremont were born for moments like this. There is no such thing as a good-great leader who has not confronted, been battered by and stumbled through-overcome a catastrophe. The Upside for the gutsy and creative is as high as the downside is low. **Jerry Rice is the greatest football player ever—and Willie Mays is the best baseball player ever. (And Sandy Koufax was okay too.) **Women rule. And make (almost) all the res real estate decisions.

6. **Decency must not be sacrificed in tough times. **Decency is more important than ever in tough times. **Painful decisions must be made—make them as gracefully as possible; doing so is the best investment in the long term possible. Your reputation will be shaped by the long memory of how you behaved when the fan was covered with yogurt. **Tough decisions mostly affect other people’s families. You must still make the tough decisions, but the minute they cease to be agonizing, resign—you’re not worth saving, you’ve become a mini-Mozilo. **Character rules in adverse times. **Now is when investment in relationships pays off—and now is when you pay the full price of not having invested in relationships when times were good and you didn’t “need to be nice” to others. **Keep good people—if it kills you.

7. **If your world is in relatively good order do not be tempted to use this “opportunity” to “consolidate” by acquiring questionable assets at firesale prices—you are not good enough to turn cow pies into gold; only your ego thinks you are, and your ego is as usual wrong. **Smaller but really good is a better place to be. (So you’ll be ready to fully participate in the next round of folly when the next Moment of Madness arrives.) **You will be remembered in the long haul for the quality of you work, not the quantity of your work—the quantity part is just your defective ego talking. (No one evaluates Picasso, based on the number of paintings he churned out.) **Work out more and harder in bad times—get high or less low on chemical cocktails generated by killer workouts. **Take advantage of tough times to realize that in the long haul you will be remembered for you humanity not your net worth—think Tim Russert. **If not Excellence, what?

8. Tom Peters’ EXCELLENCE. The Basics.Now More than ever.PCBC200827 June/George Moscone Center

9. Slides at …tompeters.com

10. “Allied commands depend on mutual confidence [and this confidence] is gained, above all through the development of friendships.” —General D.D. Eisenhower, Armchair General* (05.08)*“Perhaps his most outstanding ability [at West Point] was the ease with which he made friends and earned the trust of fellow cadets who came from widely varied backgrounds; it was a quality that would pay great dividends during his future coalition command

11. Give good tea!

12. “You have to treat your employees like customers.”—Herb Kelleher, upon being asked his “secret to success”Source: Joe Nocera, NYT, “Parting Words of an Airline Pioneer,” on the occasion of Herb Kelleher’s retirement after 37 years at Southwest Airlines (SWA’s pilots union took out a full-page ad in USA Today thanking HK for all he had done; across the way in Dallas American Airlines’ pilots were picketing the Annual Meeting)

13. “Forget China, India and the Internet: Economic Growth Is Driven by Women.”—Headline, Economist, April 15, 2006, Leader, page 14

14. “Women arethemajority market”—Fara Warner/The Power of the Purse

15. “Goldman Sachs in Tokyo has developed an index of 115 companies poised to benefit from women’s increased purchasing power; over the past decade the value of shares in Goldman’s basket has risen by 96%, against the Tokyo stockmarket’s rise of 13%.”—Economist, April 15

16. 10 UNASSAILABLE REASONS WOMEN RULE Women make [all] the financial decisions.Womencontrol [all] the wealth. Women [substantially] outlive men. Women start most of the new businesses. Women’s work force participation rates have soared worldwide. Women are closing in on “same pay for same job.” Womenare penetrating senior ranks rapidly [even if the pace is slow for the corner office per se]. Women’sleadership strengths are exceptionally well aligned with new organizational effectiveness imperatives. Women are better salespersons than men. Women buy [almost] everything—commercial as well as consumer goods. So what exactly is the point of men?

17. “You knowa design is goodwhenyou want to lick it.”—Steve Jobs Source: Design: Intelligence Made Visible, Stephen Bayley & Terence Conran

18. Hypothesis:DESIGN is the principaldifference between love and hate!**Not “like” and “dislike”

19. Experience: “Rebel Lifestyle!”“What we sell is the ability for a 43-year-old accountant to dress in black leather, ride through small towns and have people be afraid of him.”Harley exec, quoted in Results-Based Leadership

20. Message (?????): Men cannot design for women’s needs.

21. “I am often asked by would-be entrepreneurs seeking escape from life within huge corporate structures, ‘How do I build a small firm for myself?’ The answer seems obvious:Buy a very large one and just wait.”—Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics

22. Dick Kovacevich:You don’t get better by being bigger. You get worse.”

23. #4 Japan#3 USA#2 China#1 Germany

24. Reason!!!Mittelstand

25. Basement Systems Inc.

26. *Basement Systems Inc.*Larry Janesky*Dry Basement Science(115,000!)*1990: $0; 2003: $13M; 2007: $62,000,000

27. Focus: “A recent study by [Stanford] Business School faculty shows that producers whose offerings or expertise are more clearly associated with one or two product categories have better sales than those whose goods or professional identity span multiple categories. More focused producers throw off subtle hints that they know their stuff, which is not lost on customers. In short, says professor Michael Hannan, ‘The jack of all trades is the master of none governs consumer choices of whose goodies to buy.’ ”—Stanford Business, 0208

28. 25

29. General David Petraeus’ “White lines along the road”: “Secure and serve the population. Live among the people. Promote reconciliation. Move mounted, work dismounted; situational awareness can only be achieved by operating face-to-face, not separated by ballistic glass. Walk.*” —David Petraeus, Men’s Journal (06.08) * “I love that last one for its simplicity.” —DP

30. Conrad Hilton, at a gala celebrating his life, was asked, “What was the most important lesson you’ve learned in you long and distinguished career?” His immediate answer …

31. “remember to tuck the shower curtain inside the bathtub.”

32. 2-cent candy

33. <TGWvs.>TGR

34. 4/40

35. try it. Try it. Try it. Try it. Try it. Try it. Try it. Try it. Screw it up.Try it. Try it. Try it. Try it. Try it. Try it.Screw it up.it. Try it. Try it. try it. Try it.Screw it up.Try it. Try it. Try it.

36. “We have a ‘strategic plan.’ It’s called doing things.”— Herb Kelleher

37. “This is so simple it sounds stupid, but it is amazing how few oil people really understand that you only find oil if you drill wells.You may think you’re finding it when you’re drawing maps and studying logs, but you have to drill.” Source: The Hunters, by John Masters, Canadian O & G wildcatter

38. Ex-e-cu-tion!

39. “Execution is strategy.”—Fred Malek

40. “Execution is thejobof the businessleader.”—Larry Bossidy & Ram Charan/ Execution: The Discipline of Getting Things Done

41. K.i.s.s.*Keep It Simple, Stupid

42. Compression hose would mostly fix the hospital problem:“According to the American Heart Association, up to two million Americans are affected annually by deep vein thrombosis. Of those who develop pulmonary embolism, up to 300,000 will die each year. ... Deep vein thrombosis also is among the leading causes of preventable hospital death. Even more disturbing is the fact that, according to a U.S. multi-center study published by two of ClotCare's editorial board members,58% of patients who developed a DVT while in the hospital received no preventive treatment despite the presence of multiple risk factors and overwhelming data that prophylaxis is very effective at reducing these events.”—Marie B. Walker, clotcare.com, March 2008

43. “Beware of the tyranny of making SmallChanges to SmallThings. Rather, make Big Changes to BigThings.”—Roger Enrico, former Chairman, PepsiCo

44. “Beware of the tyranny of making SmallChanges to SmallThings.Rather, make BigChanges to Big Things … using Small, Almost Invisible Straightforward Levers with Big Systemic Impact.”—TP

45. “Everything matters” -80% Source:Nudge, Richard Thaler and Cass Sunstein, etching of fly in the urinal reduces “spillage” by 80%, Schiphol Airport

46. Ac-count-a-bil-ity!

47. SECDEF Bob Gates:Walter Reed, Army Sec’y; Nucs, USAF Sec’y & COS

48. “GE has set a standard of candor. … There is no puffery. … There isn’t an ounce of denial in the place.”—Kevin Sharer, CEO Amgen, on the “GE mystique” (Fortune)

49. 6:15A.M.

50. Relentless: “One of my superstitions had always been when I started to go anywhere or to do anything,notto turnback,or stop, until the thing intended was accomplished.”—Grant