Many years ago, I worked for ITT and sat across the table from Harold Geneen on several occasions. I was a young executive at the time and soaked up every word and policy promulgated by Harold Geneen. All the people around Harold Geneen seemed like very normal executives. It was not until years later that I realized that both Harold Geneen and his team were far from normal and very exceptional.
One of the concepts that came from Harold Geneen was his "Profit Assurance Plan". ITT, like most companies, required all plants and divisions to submit detailed budgets and business plans. This part was normal, but Harold Geneen required a third item. The "Profit Assurance Plan". All of you who have had to prepare detailed budgets and business plans knows that the best plans of us humans can go bad. What the "Profit Assurance Plan" did was to lay out what actions you would take if you fell short of your business plan or if some thing happened beyond your control that affected your plan. Rather than figure out what you should do "after" things went South, Harold Geneen wanted all of us to identify the most likely things that "could" go bad and then write down in your "Profit Assurance Plan" what "action" you would take. The whole concept is very simple. What the manager was supposed to do was to put the "Profit Assurance Plan" in his desk drawer and leave it there until it was needed.
When some key indicator noted in the "Profit Assurance Plan" fell below an "action" level called out in the "Profit Assurance Plan", the manager was supposed to pull out the "Profit Assurance Plan" and implement the action called out in the plan. It was like a football play book with all the plays showing under what conditions they should be "called". The concept was even more important and here is why.
Most managers can make good decisions if the pressure is not on or they are not emotionally involved. This is why the "Profit Assurance Plan" was so unique. Look at the economic cliff that we face? Don't we have a "Profit Assurance Plan"? Yes!!! If the government can not come up with a plan on how to deal with the deficit, then a list of actions will go into affect. We have the original plan that says that on 1/1/2013 the special tax relief laws passed during the Bush administration will lapse and a series of cuts in major groups like the Defense Department will go into affect. Notice that now, all the players are in an emotional state that prevents them from acting with logic. When there was no pressure or emotions, they agreed on a plan. Let's put that plan into affect. If anyone every thought that our economic problems could be solved with out "pain", they are incompetent. Bring on the pain and let's start fixing our problems before they get even worse. That is my position and one that I learned from Harold Geneen over 50 years ago.
Are we all cowards? Can't you handle some pain to save this country? To solve this one, 100% of us are going to have to deal with the pain, not just the hardest working and most responsible 1%. This is not a case where you can get some guy in a costume to sprinkle holy water on you so that you are not punished for your sins. This is the real world where we have to pay our bills.
