What Were They Thinking?

As the magazine business is getting disrupted by the web, I’ve seen countless good magazines fall by the wayside. Intelligent Enterprise, Infoworld, Guitar One (!) and now Business 2.0. One of my favorite columns in Biz 2.0 was by Jeffrey Pfeffer, a professor over at Stanford. The good news is he’s collected the best of his essays over the last five years and published them as the book “What Were They Thinking?”

This includes columns on people-centered strategies, the focus of your business, how to retain talent, how not to cut costs etc. He gave an example of how companies have spent millions on Customer Relationship Management (CRM) software, but don’t actually spend money on customer relations! That is, in cultivating positive experiences with customers by having better trained and happy employees. Consider this: if you cut the wages or retirement benefits of your retail staff how do you think they will treat customers? That’s what Pfeffer calls a “WWTT” moment. Companies sometimes make incredibly stupid short term decisions for cost-savings reasons that do more to hurt the company in the long run. That’s why it’s probably not a good idea to cut manufacturing costs if it hurts quality. Or to cut QA to save money. Fixing problems in the field is a whole lot more expensive. (And not fixing them is even worse.)

I saw Pfeffer speak over at a Stanford breakfast recently. It was a good presentation, but in some ways he’s better in print than in front of a podium. There’s a lot of meat in his essays and they require that you engage and think about it. Check out the book!