What Really Works

About the Authors

William Joyce is a renowned professor of strategy and organization theory at the Amos Tuck School of Business at Dartmouth College. His extensive research and expertise in business management have greatly contributed to the field. He has dedicated his career to understanding what makes companies successful and has published numerous articles and books on the subject.

Nitin Nohria is a professor of business administration at the Harvard Business School. His work focuses on leadership, organizational behavior, and strategy. Nohria's insights into business practices have influenced many aspiring and current business leaders. He has also served as the Dean of Harvard Business School, where he emphasized the importance of leadership in business education.

Bruce Roberson was a partner with McKinsey & Co. for 11 years and is part of a new management team undertaking the turnaround of a major corporation. His practical experience and strategic thinking have been pivotal in real-world business transformations. Roberson brings a wealth of consulting experience to the table, having worked with numerous Fortune 500 companies to improve their performance.

Main Idea

In "What Really Works: The 4+2 Formula for Sustained Business Success," the authors tackle the elusive question of what truly drives lasting business success. Through a decade-long study involving 50 academics and business consultants, they identified a combination of primary and secondary management practices that correlate with superior corporate performance. The result is the 4+2 Theory, which posits that businesses must excel in four primary practices and two secondary practices to achieve sustained success.

Table of Contents

• Primary and Secondary Management Practices
• 4+2 in the Real World
• Make Your Strategy Clear and Focused
• Execute Flawlessly
• Build a Performance-Based Culture
• Make Your Organization Fast and Flat
• Make Talent Stick Around and Develop More
• Make Your Leaders Committed to Your Business
• Make Industry-Transforming Innovations
• Make Growth Happen with Mergers and Partnerships

Primary and Secondary Management Practices

The authors identified eight management practices that directly correlate with superior corporate performance, as measured by total return to shareholders (TRS). These practices are divided into four primary and four secondary categories. Winning companies excel in all four primary practices and at least two of the secondary practices, hence the 4+2 formula.

The Four Primary Management Practices

Strategy, execution, culture, and structure form the backbone of the primary management practices.

Strategy

Managers must devise and maintain a clearly stated, focused strategy. This strategy should be sharply defined, clearly communicated, and effectively understood by employees, customers, partners, and investors.

"Managers must devise and maintain a clearly stated, focused strategy. Whatever your strategy—whether it is low prices, innovative products, or some other initiative—it will work only if it is sharply defined, clearly communicated, and effectively understood by employees, customers, partners and investors." - William Joyce, Nitin Nohria, Bruce Roberson

Execution

Companies must develop and maintain flawless operational execution. Winning companies consistently meet customer expectations by delivering on their value proposition, reducing operational costs, and increasing productivity year after year.

"Companies must develop and maintain flawless operational execution. You might not always delight your customers, but you must make sure you never disappoint them." - William Joyce, Nitin Nohria, Bruce Roberson

Culture

Organizations must foster a performance-oriented culture. Setting performance standards and consistently achieving them is crucial. How a company deals with poor performers also significantly impacts its success.

"Organizations must develop and maintain a performance-oriented culture. It is the setting of performance standards and consistent achievement of those standards that make the difference." - William Joyce, Nitin Nohria, Bruce Roberson

Structure

Companies must build and maintain a fast, flexible, and flat organization. Simplifying organizational structures and eliminating unnecessary layers can enhance responsiveness and efficiency.

"Companies must build and maintain a fast, flexible, and flat organization. Simpler and faster are the best goals for all reorganization efforts." - William Joyce, Nitin Nohria, Bruce Roberson

The Four Secondary Management Practices

Any combination of two secondary management practices—talent, leadership, innovation, and mergers/partnerships—when combined with the four primary practices, can lead to a winning company.

Talent

Companies must hold on to talented employees and work to find more. Developing in-house stars rather than relying solely on outside hires is a key indicator of a company's depth and quality of talent.

"Companies must hold on to talented employees and work to find more. The most important indicator of the depth and quality of talent in your organization is whether you can grow your own stars from within, not whether you can buy or rent talented outsiders." - William Joyce, Nitin Nohria, Bruce Roberson

Leadership

Firms must ensure their leaders and directors are committed to the business. Good boards possess a deep understanding of the business and a passionate commitment to its success.