Guts!

The book Guts: Companies That Blow the Doors off Business-as-Usual, by Kevin and Jackie Freiberg, is essentially a “how to” book centered around making a company a success with creative thinking put forward by fearless leaders. The central thesis in this book is that by treating employees like gold instead of dirt, by empowering workers to build your brand and by making them far more than just “satisfied,” companies will make more money and save the money other companies spend training their new employees because of high turnover.

The reason the companies featured in this book have become successful is because the leaders in those firms put an end to “fear-based management.” The authors have written an entertaining book in which they pull no punches about their over-riding philosophy: Gutsy leaders have “bravery and vision” which enables them to “dismantle fear-based management” and replace it with “heart, soul, discipline, loyalty, humor – and long-term record profits.”

The concept of strategic leadership is alive and well throughout this book. This is a thoroughly relevant book vis-a-vis strategic leadership in business. Leading a company in today’s global and highly competitive market requires forward thinking and the ability to link the various components of an organization into a strong culture that absolutely believes in taking chances rather than settling for the old ways of doing things. The authors have examined a number of successful businesses – where management had the “guts” to step out of the box and design a strategy that makes employees feel important and loved – including Southwest Airlines (which they also featured in Nuts, their first book), Whole Foods, Starbucks, and many more.

Classic strategic leadership is practiced at Whole Foods; it’s “gutsy founder and chief executive” John Mackey has “largely given over the operation to his employees” (Freiberg, 69). What that means is Mackey has somehow trained his employees to “think and act like owners” (Freiberg, 72). The authors explain on page 78 that just offering profit sharing and stock options isn’t enough; “You must educate them,” Freiberg writes, by “demystifying the language of business.” And it goes beyond that too at Whole Foods; every employee’s salary is posted for all to see. There must be a sense of progressive thinking and openness that is part of strategic management’s mantra, where the boss teaches workers how to “bend, stretch, or even break rules that don’t serve the customer.”

The theme of this book should work well in almost any business. For instance, Chapter 4 describes how to hire people “…who don’t suck,” which is a common cliche but the authors go into great detail about strategic hiring. Before hiring people to fill responsible positions – and this portion applies to any business in any sector of the economy – a company should define “what it takes” to be a “great employee” in that company. The money saved by keeping employees instead of constantly hiring and training new employees can add up to enormous sums.

Mark Hendricks – writing in the journal Entrepreneur – points out that the Freiberg book offers good advice on how a company can succeed with “unusual, visionary, courageous and sometimes outrageous approaches” (Hendricks, 2004). But a company cannot succeed by just offering employees perks like “on-site fitness centers” and “free dry cleaning” to “retain and inspire employees.” Instead, the idea in hiring is to put forward something “truly heroic” in what the company does and then make certain that “every employee knows what it is.” By teaching employees to think of their company as their own, and by inspiring them to be heroes within the company, the company is likely to keep employees longer.

In the Library Journal writer Carol J. Elsen suggests that Guts offers a formula for making successful companies by creating leadership within the entire workforce. This is a radical switch from what many companies do with regard to their employees. Creative managers understand that employees should not be treated “as cogs in a wheel but as human beings with the potential to connect with their customers and transform their companies while having fun in the process” (Elsen, 2003). The writer was impressed by the portion of the book that described software maker SAS Institute’s approach to making employees proud and happy. The SAS Institute provides “subsidized Montessori child care, free snacks, and unlimited sick time for staff.” The result of that impressed Elsen; “An industry-high employee retention rate.”

And Elsen couldn’t help but be moved by the innovative way in which Southwest Airlines treats employees. The employees at Southwest Airlines are “taught” how the profit-sharing aspect of business works because management stuffs “comic-book style financial statements into Cracker Jack boxes.” By seeing the financial realities of day-to-day business dynamics, Southwest Airlines workers know how to “…unleash their creativity to shrink costs and beef up the bottom line,” Elsen explains.

She even promotes the book for libraries by suggesting “innovative management is always a winning theme” when it comes to “public and academic library business collections.”

Still another review of the book – by Leigh Rivenbark in HR Magazine – explains that what the Freibergs have offered readers is a strategy that puts employees before customers. The theme of Rivenbark’s critique is simple; employees are the “chief communicators of a company’s culture to the world, so if employees aren’t happy, customers won’t be either…”

Rivenbark was impressed by the innovative and strategic management style of the retail chain Bon Marche, featured in Guts. The CEO and HR chief worked collaboratively to create an “employee-first culture” at Bon Marche. How did they do this? They changed the culture completely in an attempt to slow down the rate of turnover. Management went to employees and asked them to put together “telecommuting options, bonus programs, a casual dress code” along with a flexible schedule to fit workers’ personal driving needs and family concerns. “Turnover plummeted,” Rivenbark went on, and the customer service department improved as well.

This book is loaded with examples that can be used by employees and management in many ways. The bias that the authors show over and over is against companies that run their businesses the old fashioned, top-down way. Authority for many companies still lurks at the top of the ladder, and employees are expected to toe the company line and meet the standards that were established – and are enforced by the Human Relations department – at the time the company was formed. The book doesn’t actually go into detail about these rigid companies nor does the book point them out. The book doesn’t have to identify sluggish-thinking companies because by pointing to those companies that do want their employees to be empowered, that do want their workers to have fun and feel like they are part owners, it leaves the lumbering firms in the dust.

Meanwhile, the “Gut Check” section of this book (pp 142-151) should be photocopied by every HR manager and every CEO along with everyone in a position of authority or in charge of hiring in every company. Why? This is the formula for strategic management in the New Millennium. Talent is key to a company’s success, and the strategies that go into hiring the best talent not only reflect the philosophy of the company, they are the drivers that determine whether the company will be profitable or not. Speaking of bias the authors show, the heading, “What people know is less important than who they are” (143), indirectly sheds light on those companies that hire based on someone’s experience in past work situations. “Screen for passion” is another example of how to build a successful culture within a company. Does the person have a “tone” in his or her voice that is enthusiastic? And “Hire the unconventional” is another example of the innovative nature of this book. “Look for open-minded people who are fun, spontaneous, and have the guts to take a risk,” the authors explain (144). And there is that word “guts” again, which of course is the point of the whole book.

Works Cited

Elsen, Carol J. (2003). Guts! Companies That Blow the Doors Off Business-as-Usual. Library Journal, 128(20), p. 134.

Freiberg, Kevin, & Freiberg, Jackie. (2004). Guts! Companies That Blow the Doors Off Business-as-Usual. New York: Doubleday.

Hendricks, Mark. (2004). Don’t be a hero? Not if this book has anything to say about it.

Entrepreneur, 32(3), p. 29.

Rivenbark, Leigh. (2004). Guts! HRMagazine, 49(7), 137-139.