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Title: Mean Business: How I Save Bad Companies and Make Good Companies Great by Albert J. Dunlap, Bob Andelman ISBN: 0-684-84406-0 Publisher: Fireside Books Pub. Date: 01 October, 1997 Format: Paperback Volumes: 1 List Price(USD): $20.95 |
Average Customer Rating: 3.31 (29 reviews)
Rating: 5
Summary: Leadership combined with Common Sense
Comment: Coporate America is filled with non-leaders who can't make decisions. Al Dunlap's common sense direct approach to solving problems is refreshing. If you look at many new successful companies today (i.e Mindspring, Amazon) you will find that they are practicing "Mean Business". They keep costs low, tie employee compensation to company stock, make lightning fast decisions and keep their operations streamlined. They attach less value to a college degree than to ability and work ethic. They don't lay-off people because they don't bloat themselves up to begin with. They also don't build unnecessary opulent corporate headquarters. By following "Mean Business", they kick the crap out of the competition. If you want to succeed, read this book. These principles can be applied at any level.
Rating: 4
Summary: A worthwhile tale of corporate reform, swaggeringly told.
Comment: The only reason this book doesn't merit a full five stars is its relentless tone of braggadocio and self-promotion. Yes, Al Dunlap did a good thing. He turned around a company and channeled the money to the shareholders, but let's not go overboard. He didn't win a war, or find a cure for a disease, or create a beautiful work of art. He just did the job he was paid to do, and he did it well. When he plasters his face four times on the cover of his book and talks about his work with words like "revolution" and "conquest", it's too much. It makes me think he's got a publicist telling him what to do. Hubris, overweening pride, has from ancient times been a trait that wise men and women were taught to avoid. Dunlap is probably a wise man, so he should dump whoever's urging him to, like a rooster, take credit for the sunrise.
That said, I can go on to the ideas in the book, which are very good and long overdue. First, simplicity. Dunlap says it several times: business is simple. Contrary to what the gurus and B-school touts would have you believe, business is not rocket science. Business is the part that comes after rocket science, when you try to make rockets as cheap as you can and sell as many as you can at the highest possible price. In Dunlap's case, paper had already been invented. It just needed to be marketed and sold at a profit. An opulent headquarters and an elitist bureaucracy did nothing to attain that goal. So Dunlap fired most of the managerial class and sold the headquarters. Simple. He then sold all of the companies in the Scott conglomerate that didn't have any relation to tissue paper. Then he dumped most of the consultants because, he reasoned, why would a high-priced so-and-so know more about running a paper company than a person who'd spent years working in a paper company?
One of Dunlap's greatest strengths is his common sense. He was able to see, and had the nerve to say, that Scott's consultants were too brainy and pricey for the tissue paper business, and that Scott executives could work in less luxurious offices. He was able to see that a power plant was not a sensible part of a paper products company. Most important, he was able to see that Scott was not serving the people who owned it. None of these things are profound insights, they're just common sense.
It is the core of Dunlap's philosophy that I find most agreeable. The job of the employee, whether great or small, is to enhance the value of the shares of the company. Dunlap blasts away at the fashionable notions that one by one have replaced the idea that the goal of a company is to make a buck for the people who invest in it. Many of his critics believe the object of a company is to provide a steady income and benefits package to its employees. Not so, says Dunlap. Those things are secondary to a company's mission. They only make their income and benefits because the owners put up their money in the first place. The owners deserve priority. Others believe a company is a vehicle for social change, something akin to a legislature or philanthropic foundation. In this view, an executive is a mere conduit for the money which must flow from consumers to company and eventually to the institutionalized panhandlers known as fund-raisers. This class, which includes everything from college presidents and grant "writers" to fundamentalist preachers and social activists, has come to believe that they are the proper beneficiaries of corporate profit. Incredible to relate, so do some CEOs! Dunlap went into Scott with his chainsaw, and severed the link between them and his company. It's not that greed is good and charity is for suckers, as Hollywood would have us believe is the credo of business. It's that charity is the responsibility of the individual.
Dunlap doesn't mind executives doling out largesse to charity, as long as it happens after shareholders have been served.
The logical thing to do is to make sure your executives are shareholders. In this, Dunlap put his money where his mouth was. Upon becoming CEO of Scott, he invested $4 million of his own money in Scott stock. Then he summoned all the executives who hadn't been fired, and ordered them to invest heavily in Scott. By making sure his executives were shareholders, he assured himself that they would keep the shareholders interests foremost.
After these drastic steps were taken, the rest appears to have been easy. Whether it really was easy, and whether the drastic steps were easy, we may never know. Mean Business makes it sound like going into a corporation and changing deeply-rooted habits is like George Patton going in and whipping the US Army into shape. The book makes no mention of any opposition to Chainsaw Al that lasted any longer than a few minutes. Employees and directors were dismissed by the hundred, assets were sold, habits were changed, and never once did Dunlap receive a setback of any kind. It is marvelous if true. But I suspect some has gone untold in the interest of creating a legend.
It may be that the story of Sunbeam and Dunlap, if ever told, will be more interesting than Scott and Dunlap. For as Bill Clinton illustrates, an egomaniac is far more interesting when squirming than when trumpeting.
Rating: 4
Summary: Good advice from a shamed author
Comment: The jury is no longer out on the author or the advice.
The author's exploits are well documented:
- He turned around numerous companies by cutting headcount & product lines. Sold the companies for huge profit to himself and the shareholders.
- Much of his success came from the ideas of external consultants.
- He destroyed Sunbeam in a massive explosion of layoffs, fraud and corporate mismanagement.
So should one listen to his advice? If you're willing to separate the message from the author, there is quite a bit of good advice to be had:
1 - If a business is dying, you have to put the needs of the shareholders first. If there's no company, there are no jobs either.
2 - Cutting costs is a hard business. Unless you cut enough fat with confidence the first time around, you'll spend forever in a downward cycle of repeat layoffs and dwindling morale.
3 - Product complexity equals cost, and if you want to simplify your marketing and manufacturing, reduce the variations in your products.
4 - More factories mean more costs. Aggresive consolidation of manufacturing is required in a shrinking business.
Hard to argue with these, and they are indeed worth knowing.
Is the book worth reading? Yes, but.... Take it with a grain of salt. As well as the examples. Realize that perhaps it was just a bit too much of self-congratulations from a dishonest man. And know that turning around a troubled company is indeed a mean business.
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Title: Chainsaw: The Notorious Career of Al Dunlap in the Era of Profit-At-Any-Price by John A. Byrne ISBN: 0066619815 Publisher: HarperBusiness Pub. Date: 01 July, 2003 List Price(USD): $14.95 |
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Title: Pour Your Heart into It : How Starbucks Built a Company One Cup at a Time by Howard Schultz, Dori Jones Yang ISBN: 0786883561 Publisher: Hyperion Pub. Date: 13 January, 1999 List Price(USD): $15.95 |
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Title: In Light of India by Octavio Paz, Eliot Weinberger ISBN: 0156005786 Publisher: Harvard University Press Pub. Date: 01 April, 1998 List Price(USD): $13.00 |
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Title: The Book of Hindu Imagery: Gods, Manifestations and Their Meaning by Eva Judy Jansen, Tony Langham, Eva Rudy Jansen ISBN: 9074597076 Publisher: Weiser Books Pub. Date: 01 October, 1993 List Price(USD): $14.95 |
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Title: The Restaurant : From Concept to Operation by John R. Walker, Donald E. Lundberg ISBN: 0471356069 Publisher: Wiley Pub. Date: 20 October, 2000 List Price(USD): $67.45 |
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