Do you know Ram Charan?

The Eight Know-Hows

Here is a breakdown of the eight know-hows:

1. Positioning and Repositioning: Finding a central

Idea for business that meets customer demands and that

makes money.

2. Pinpointing External Change: Detecting patterns

in a complex world to put the business on the offensive.

3. Leading the Social System: Getting the right people

together with the right behaviors and the right information

to make better, faster decisions and achieve business

results.

4. Judging People: Calibrating people based on their

actions, decisions and behaviors, and matching them to

the non-negotiables of the job.

5. Molding a Team: Getting highly competent, highego

leaders to coordinate seamlessly.

6. Setting Goals: Determining the set of goals that

balances what the business can become with what it can

realistically achieve.

7. Setting Laser-Sharp Priorities: Defining the path

and aligning resources, actions and energy to accomplish

the goals.

8. Dealing With Forces Beyond the Market:

Anticipating and responding to societal pressures you

don’t control but that can affect your business.

Personal Traits and the

Know-Hows

The following are the personal traits that can help

or interfere with the know-hows:

✓ Ambition — to accomplish something noteworthy

BUT NOT win at all costs.

✓ Drive and Tenacity — to search, persist and

follow through BUT NOT hold on too long.

✓ Self-Confidence — to overcome the fear of

failure, fear of response or the need to be liked and

use power judiciously BUT NOT become arrogant

and narcissistic.

✓ Psychological Openness — to be receptive

to new and different ideas AND NOT shut other

people down.

✓ Realism — to see what can actually be accomplished

AND NOT gloss over problems or assume

the worst.

✓ Appetite for Learning — to continue to grow

and improve the know-hows AND NOT repeat the

same mistakes.

Detecting Patterns in the

Complex World

Here are seven simple questions that can help you

sort through and detect patterns in the complex

world around you:

1. What is happening in the world today? The

most significant trends affecting business transcend

company and industry.

2. What part of my frame of reference has

worked for me? What hasn’t worked for me? The

construction of your own frame of reference based

on previous experience is a large part of learning to

detect changes in external patterns.

3. What does it mean for anyone? The newspaper

industry is undergoing vast changes as a result

of the Internet and Google.

4. What does it mean for us? Once you have the

big picture, you can begin to examine what it means

for your own company’s strategies. That’s what

General Electric’s CEO Jeff Immelt did when he

decided to meld several of GE’s businesses into the

infrastructure business to sell items such as energy

equipment and services, railroad locomotives and

aircraft items — all necessary ingredients in rapidly

growing economies.

5. What would have to happen? Apple’s invention

of the iPod would have been considerably less successful

had it not created iTunes, the online source

of downloadable music.

6. What do we have to do to play a role? GE’s

decision to market its infrastructure products in

emerging markets required it to reorganize those

businesses in a way that recognized the difference

between selling a power plant to an American utility

and selling that same power plant to a foreign

government.

7. What do we do next?