Nice coaches stress fundamentals—the basic skills and performs that make a group a consistent winner. Nice general managers do the same thing. They know that sustained superior performance can’t be constructed on one-shot improvements like restructurings, large price reductions, or reorganizations. Sure, they’ll take such sweeping actions if they’re in a situation where that’s mandatory or desirable. However their priority is avoiding that kind of situation. And so they do this by specializing in the six key tasks that constitute the foundations of every general manager’s job: shaping the work environment, setting strategy, allocating resources, growing managers, building the organization, and overseeing operations.

This list shouldn’t be surprising; the basics of a general manager’s job ought to sound familiar after all. What makes it vital is its standing as an organizing framework for the vast mainity of activities general managers perform. It helps you define the scope of the job, set priorities, and see essential interrelationships amongst these areas of activity.

Shaping the Work Surroundings

Every company has its own explicit work setting, its legacy from the previous that dictates to a considerable degree how its managers reply to problems and opportunities. But regardless of the surroundings a general manager inherits from the previous, shaping—or reshaping—it is a critically necessary job. And that’s as true in small- and medium-sized firms as it is in giants like General Motors and General Electric.

Three elements dictate a company’s work environment: (1) the prevailing performance standards that set the tempo and quality of individuals’s efforts; (2) the business ideas that define what the corporate is like and how it operates; and (three) the individuals ideas and values that prevail and define what it’s like to work there.

Of those three, performance standards are the single most necessary element because, broadly speaking, they determine the quality of effort the group puts out. If the general manager sets high standards, key managers will often observe suit. If the GM’s standards are low or vague, subordinates aren’t likely to do a lot better. High standards are thus the principal means by which high general managers exert their affect and leverage their abilities across all the business.

For this reason, unless your company or division already has demanding standards—and only a few do—the one biggest contribution you may make to instant outcomes and lengthy-time period success is to lift your performance expectations for each manager, not just for yourself. This means making acutely aware decisions about what tangible measures constitute superior performance; where your company stands now; and whether you’re prepared to make the tough calls and take the steps required to get from here to there.

Clearly one of the vital necessary standards a GM sets is the company’s goals. The most effective GMs set up goals that pressure the group to stretch to achieve them. This doesn’t imply arbitrary, unrealistic goals which can be certain to be missed and encourage nobody, however relatively goals that won’t allow anybody to neglect how powerful the competitive enviornment is.

I vividly keep in mind one general manager who astonished subordinates by rejecting a plan that showed good profits on a superb sales acquire for the third year in a row. They thought the plan was demanding and competitive. But the GM told them to come back back with a plan that kept the identical volumes but lower base price ranges 5% below the prior year’s, instead of letting them rise with volume. A troublesome task, but he was satisfied the goal was essential because he anticipated their chief competitor to chop prices to regain market share.

Through the subsequent few years, the company dramatically modified its cost structure by way of a series of modern value reductions in production, distribution, buying, corporate overhead, and product-combine management. Because of this, despite substantial value erosion, it racked up record profits and share-of-market gains. I doubt the company would ever have achieved those results without that tangible goal staring management in the face each morning. The same kind of thinking is apparent in the comments of a prime Japanese CEO who was asked by a U.S. trade negotiator how his firm would compete if the yen dropped from 200 to the greenback to 160. “We are already prepared to compete at a hundred and twenty yen to the dollar,” he replied, “so one hundred sixty doesn’t fear us at all.”

High standards come from more than demanding goals, of course. Like prime coaches, military leaders, or symphony conductors, high general managers set a personal instance by way of the lengthy hours they work, their obvious commitment to success, and the constant quality of their efforts. Moreover, they set and reinforce high standards in small ways that quickly mount up.

They reject long-winded, poorly prepared plans and “bagged” profit targets instead of complaining but accepting them anyway. Their managers have to know the details of their enterprise or operate, not just the big picture. Marginal performers don’t stay lengthy in pivotal jobs. The best GMs set tight deadlines and enforce them. Above all, they are not possible to satisfy. As quickly as the sales or production or R&D department reaches one standard, they raise expectations a notch and go on from there.

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