Now I have done quite a few book reviews. They have all been reviews of fairly new books, released in the last couple of years. This one will be different since the book I’m now going to write about was released already in 1987, but it’s still relevant today. I’m talking about ”Moments of Truth” by Jan Carlzon, it was first released as ”Riv pyramiderna” in Swedish 1985.
Some years ago me and my family lived closed to the place where the SAS headquarter was located between 1987 to 2010 in Frösundavik, Solna, Sweden. When I was on parental leave I would often take a walk with the stroller around the office. It is beautifully located in a surrounding park next to a lake. I would daydream and think of the glory days of SAS (Scandinavian AirlineS) in the eighties when Jan Carlzon was the president and CEO.
This is a fairly short book, no corporate bulls**t, compactly told in 135 pages, and divided into twelve chapters. Here is a walkthrough:
1. A Moment of Truth
By ”moment of truth” Jan Carlzon means the few seconds or minutes a customer contact may last, but that reflects the ”functionality” of the whole organization. A customer-driven company is one that recognize that its only true asset are satisfied customers. A leader of such a company can’t be an isolated and autocratic decision maker. Instead, he or she must be a visionary, a strategist, an informer, a teacher, and an inspirer.
2. The Vingresor and Linjeflyg Turnarounds & 3. The SAS Turnaround
These two chapters tells the success stories of Jan Carlzon’s turnarounds at three Scandinavian travel companies.
4. Profession: Leader
In the summer of 1981, the first year he became president of SAS, Jan Carlzon decided to take a two weeks’ vacation during the summer. At his summer house, he immediately got disturbed by the phone ringing and eventually he gave up and went back to the office. Next year he was interviewed by a newspaper on the subject ”taking it easy”. He agreed on one condition, that the article should be published one week before his vacation. In the interview Jan stated that he believed that responsibility should be delegated and so that individual decisions are made at the point of responsibility, not far up the organizational chart. He stated ”If my phone doesn’t ring, that is a proof that I have succeeded”, and then he went on four weeks’ vacation. And the telephone remained wonderfully silent!
5. Setting the Strategy
First assess the business climate and determine the needs of your customers. Then based on that knowledge, outline a business strategy to meet the customers’ needs within the context of the marketplace and organize your company to intelligently carry out that strategy.
6. Flattening the Pyramid
A SAS office in Stuttgart was given three challenges/goals: 1) cut cost without sacrificing quality 2) increase efficiency 3) give the organization more flexibility. Werner Tarnowski, the man in charge, started with closing down one of the two offices (the workload was unevenly spread). He created one cross-functional team that was responsible for all SAS activities in Stuttgart (cargo, passenger sales etc.). This lead to better service because the organization became more flexible (people with different professions now working as a team and stepping in for each other to solve customer demands immediately).
Jan admits one mistake when flattening the pyramid at SAS. They missed out on the middle managers that felt demoted in the new organization, when ”the frontline people” became empowered. Their new servant leadership felt unusual and they needed to learn new ways to handle this.
7. Taking Risks
Here is a quote from this chapter that I really like:
”Wrong decisions should be used as the basis for training; right decisions should be used as the basis for praise and positive examples. A person who is admonished for his mistakes should be entitled to appeal his case without fear of retribution.”
In 1981 to prepare for many organizational changes a booklet called ”Let’s Get in There and Fight” was distributed to all employees of SAS (20.000 persons). The booklet was a tool to present the overall vision and strategy, but most important, set the expectations on the employees themselves. Communication, especially with employees, has always been a top priority for Jan Carlzon. During his first year he spent exactly half of his time ”out on the field” talking to SAS people. Another good quote:
”A leader’s ways are watched carefully and adopted by others in the organization.”
Setting a good example is truly the most effective way of communication, and setting a poor one is disastrous!
9. Boards and Unions
The trick here is to share the knowledge about where the company is and where it should be heading to the boards, unions and employees. For the vision to become reality, it must be their vision too.
10. Measuring Results
One of the most basic mistakes that a service-oriented business can make is to promise one thing and measuring another. You will always steer behavior towards what you measure. If you measure ”the wrong thing”, you will also get ”the wrong behavior”.
11. Rewarding Employees
Unfortunately, in many companies (especially in Sweden) the only thing that gets attention is a mistake. To reward employees can be done in a number of ways, some will be good and others will be bad (it’s the same thing as for measuring, see above), but in the end, the richest reward of them all is being proud of your work!
12. The second Wave
How should you continue when you have reached all your goals, is it then time to settle down? No, because ”Everyone wants a challenge”! I end this chapter with a final quote:
”A true leader is one who designs the cathedral and then shares the vision that inspires others to build it.”
What has this old book have to do while lean and agile, you may wonder. First and foremost the values in this book is well inline with the agile thinking, talking about empowered teams that are cross-functional and customer focused. Secondly this book is for good and bad still as relevant as it was back in 1985. It’s somewhat sad that we haven’t come further in more companies in the world today. If you are an agile person in Sweden I assume you have already read this book 🙂 For you others in the rest of the world, pick up a copy right now!
I should also say that ”Riv pyramiderna” (the version in Swedish, seen to the right in the picture above) is longer, 213 pages and holds more content (a summary and afterwords written by Jan Carlzon in 2008).
All the best,
Tomas from TheAgileist