1. 1 The Hidden Drivers of Corporate Performance Tom FitzGerald & Caryl Barclay 09/21/04 FitzGerald Associates University of Chicago GSB Identifying, Quantifying, Transforming

2. 2 Traditional Measures of Performance Financial Credits/Debits ROI ROA Discounted Cash Flow Stock Price Parametrics Market Share Quality (Returns) Staff Turnover Pilferage Client Turnover Growth Rate Product Sales (New Vs Old) Customer Capture Rate Customer Turnover

3. 3 The Stages & Measures of Corporate Decline See Next Slide

4. Stages and Measure of Corporate Decline

5. 5 Drivers of Performance The organizational and human factors that underlie and impel corporate expectations, behaviors and actions There are more than 100 ~10 Positive (Performance Generators) ~90 Negative(Performance Blockers)

6. 6 Performance Blockers Examples –Internal Rivalries –Bureaucracy –Dictatorship –Lack of Trust etc., etc., etc.,

7. 7 Performance Generators Corporate Decisiveness Acknowledgement of Work Vision Communicated Corporate Assertiveness Profit Orientation Personal Accountability Cooperation Tolerance for Risk Innovation Customer Orientation

8. 8 The Impact of Changing Just Corporate Decisiveness Acknowledgement of Work Vision Communicated Begins to show in the financials within the month as systemic performance improvement.

9. 9 How to Change the Drivers Take the corporate energy that is tied up in the negatives and move it into the positives. Classic Intervention Process Catharsis --> Cathexis --> Action

10. 10 Changed Performance Drivers Noticed immediately during sessions Greater decisiveness Open discussion of work Feeling of confidence Improved Morale etc.

11. 11 Client 1 Core Performance Blockers Fear of Conflict Lack of Trust Dissonance Within Management Core Performance Generators Increased Decisiveness Open Discussion of Work Active Cooperation With Major Client First Year Results Increased Revenues by 25% - Profits by 31% - Systemically Beat Profit Plan by $5,000,000 - ROI of 50:1 1200 Person Manufacturing Co.

12. 12 Client 2 Core Performance Blockers Lack of Trust Bureaucracy Tolerance for Incompetence Core Performance Generators Increased Decisiveness Open Discussion of Work Increased Accountability First Year Results Reduced Costs by $6,000,000 - Systemically Met budget for first time in seven years. ROI of 35:1 2000 Person Utility

13. 13 Client 3 Core Performance Blockers Dissonance Within Management Tolerance of Incompetence Core Performance Generators Increased Decisiveness Open Discussion of Work Increased Accountability First Year Results Reduced Costs by $900,000 on Revenues of $6,000,000 - Systemically ROI of 30:1 100 Person Trust Co.

14. 14 Client 4 Core Performance Blockers Dissonance Within Management Disagreements With Holding Company Lack of Trust Core Performance Generators Increased Decisiveness Open Discussion of Work Increased Tolerance for Risk First Year Results Increased Revenues by 50% - Staff by 11% ROI 100:1 150 Person Leasing Co.

15. 15 Q & A

16. 16 How-To Links Mirror, Mirror, on the Wall... http://managementconsultants.com/content.cfm?Contentalias=mirrormirror&rc=1Mirror, Mirror, on the Wall... Fire In The Corporate Belly http://managementconsultants.com/content.cfm?Contentalias=fireinthecorpbelly&rc=1Fire In The Corporate Belly List of Parameters http://managementconsultants.com/content.cfm/caos?????????? List Of Performance Drivers http://www.managementconsultants.com/?????? A Survey (Use “LOOK” as Password) http://www.corporate360.com/360/

17. 17 Wrap Up The Root Causes (Drivers) of Performance Are the Earliest Predictors of Corporate Success or Failure The Drivers of Performance Can Be Identified and Measured They Can Be Changed Changing the Drivers Changes the Trajectory of the Company Changing the Drivers Costs Very Little