MONDAY, May 15, 2006 — Reminding his audience that "knowing is not enough," management guru Bud Bilanich challenged local leaders to learn important lessons from the nation's high-performing companies. But, most importantly, to put that knowledge into action.

Bilanich's May 3 presentation to more than 100 members and guests focused on insight gained from three decades working with some of America's best-known companies. Organizations including Pfizer, Johnson and Johnson, Citicorp, JP Morgan Chase and AT&T.

But it drew lessons -- some good, some bad -- from nearly a dozen other companies that succeeded with what Bilanich called "wonders" or crashed and burned by committing what he termed "blunders."

The keys to success, according to the self-proclaimed "Common Sense Guy" are fairly straightforward, Create clarity. Develop commitment. Improve execution. And, build relationships.

Create Clarity

In one of his many colorful analogies, Bilanich compared the concept of organizational clarity to a head of broccoli. Just as the "stalk and head" pattern of broccoli is repeated throughout the plant, he said, organizational leaders must make sure they know why the organization exists -- and make sure that understanding is translated and repeated throughout the organization.

Continental Airlines has done this well, he believes, by keeping core principles in front of everyone in and around the organization, including customers. That allows companies to know what "they've signed on for" and move in the same direction.

A PBS affiliate in Colorado was his example of a blunder, when a fundraising auction distracted the organization from its true purpose and diverted effort from its core purpose into running what essentially became an elaborate flea market.

Develop Commitment

Clarity of purpose is important, Bilanich said, but only when members of the organization are committed to put those principles into action.

"You can tell it immediately when you go into an organization if there's a high level of commitment," he said. "The value of commitment is that committed people go above the call of duty because they want to, not because they have to .... And that's what you're striving for."

In its simplest form, commitment can be developed by simple forms of recognition, like a pat on the back. Companies like Starbucks, though, have taken it a step further. Bilanich said the company provides health insurance for any employee working 20 hours or more each week and allows those same employees to participate in an contribution-matching 401(k) program.

In one of the more intriguing blunders, he said, Charles Schwab - ironically, a financial services company - stopped matching 401(k) contributions made by its employees.

Improve Execution

While it may seem obvious, Bilanich said high-performing companies pay particular attention to improving execution. Or, as he said, "doing the right things right."

Once leaders understand what the right things are -- and that's what clarity helps refine -- it's critical to supply the correct processes, equipment, materials, environment, people and measurements to get those things done correctly.

Chipolte Mexican Grill, Bilanich believes, executes its core mission well by offering custom-made tacos and burritos made from high-quality, fresh ingredients.

On the other hand, one talc mine and processing plant didn't do so well, when it was measuring the wrong thing when trying to gauge performance of its shipping process. Instead of focusing on whether shipments were leaving the plant according to the company's timetable, he said, leaders should have been determining whether shipments were arriving on time. Though everything was leaving on time, routine delays meant delivery deadlines were missed regularly. The result: dissatisfied customers.

Build Relationships

Though it may seem too "soft" for many corporate leaders, Bilanich said building relationships is essential for success. Because organizations do not exist in a vacuum, leaders must build strong, mutually-beneficial relationships with customers, suppliers, regulators, investors and communities.

Because of a strong relationship forged between a Pfizer plant and its community, company leaders were able to carry on when an accidental emission caused an environmental health issue. Though only the company knew about the emission, leaders contacted regulators and the newspaper to explain what happened and assure everyone there was no adverse effects. When the company decided to expand the plant later, the community rallied to support the proposal.

The Philadelphia Electric Co. wasn't so fortunate with an early nuclear plant. By ignoring regulators repeatedly, a group of small violations, taken as a whole, was used to shut down the company for 18 months, resulting in an $2.5 million loss per day.

Use Your Common Sense

After rifling off a long list of specific ways to do what's necessary in organizations - create clarity, develop commitment, improve execution and build relationships - The Common Sense Guy concluded with his common-sense advice about common sense.

"Common sense ain't all that common, because it takes a lot of hard work to make it work," he said. "But if you use yours -- not just in running your businesses or running your organizations, but in your life -- you're going to be successful."