strategy+business is published by PwC Strategy& Inc.
 
or, sign in with:
strategy and business
Published: July 1, 2001

 
 

Jack Stack’s Story Is an Open Book

At heart, Jack Stack has become interested not just in building wealth, but quality of life. Springfield is burgeoning: Once a sleepy truckers’ hub and college town, it is now a small city with more than 150,000 people. Thus, for the last year or so, Mr. Stack has championed entrepreneurial causes that apply his methods to the community around him. He is president of a business coalition that last September opened a new “Partnership Industrial Park,” a site where SRC’s new companies and others have already located (and one of the few industrial parks designed not to have a ferocious traffic jam at closing time). He and a group of partners have also raised $6 million in local investment money for a venture-capital fund called Quest Capital Alliance, with a deliberate strategy of long-term investment in Midwestern companies. The fund maintains an informal affinity for companies that play the Great Game already and a willingness to instill the Game in other companies they invest in

A more typical path for the CEO of a fast-growing $140 million company would be to move to the next level through acquisition, as Cisco Systems Inc. did, or to break out into internationally visible businesses, as Virgin Enterprises Ltd. did. At the very least, Jack Stack could have easily established subsidiaries of Springfield Remanufacturing around the world, bringing open-book management to his own shops everywhere. Instead, he has tried to maximize his influence in a specific local sphere, a place where he can still make time for his family, for bass fishing, and for casual conversations at the local bar and golf course. He still visits each of the companies once a month or so; he still tries to know the names of as many people on the shop floor as possible. That would be much tougher to do in a production territory that spanned the country or the globe

If the Springfield success continues, presumably more companies will try to emulate it. But few will succeed. A business plan based on “hundreds of little huts” is only viable when the people involved have been playing the Great Game of Business together for years. That is not a cultural change that occurs overnight; it has taken 18 years for SRC to get to where it can incubate so “effortlessly.”

Perhaps, as some educators argue, changing attitudes and business skills needs to start with educating children. Every schoolchild should be exposed to the Great Game of Business, so that they know, from a young age, how to build and accrue wealth. Or, at the very least, perhaps it should be routinely taught in business schools. As Mr. Stack himself puts it, there is nothing mysterious about the numbers in themselves: “The fundamentals of an income statement haven’t changed since 1454, when double-entry bookkeeping was invented. Sales will always be on top, and net income will always be on the bottom. Assets always start with cash and may end up with equity. And the sources and uses of funds are always the same.”

But one of the clear lessons from SRC is that financial literacy can’t be taught in a vacuum; it takes active participation in an ongoing business, or the Great Game doesn’t make any sense, and people give it up. The ultimate legacy of SRC is a view of business itself as a kind of ongoing practice — a discipline like meditation, in which people train themselves in a new way of thinking that becomes second nature over time. This way of thinking, however, is not dedicated to fostering humanity; it’s dedicated to building wealth that sustains an economically healthy community with humane values. So perhaps an open-book management philosophy is dedicated to building both at once. That seems appropriate for a school of meditation that has emerged, not from China or Sufi tradition, but from the American Midwest.

 
 
 
Follow Us 
Facebook Twitter LinkedIn Google Plus YouTube RSS strategy+business Digital and Mobile products App Store

 

Resources

  1. H. Thomas Johnson and Anders Bröms, Profit Beyond Measure: Extraordinary Results Through Attention to Work and People,The Free Press, 2000
  2. Chuck Kremer, Ron Rizzuto, and John Case, Managing by the Numbers: A Commonsense Guide to Understanding and Using Your Company’s Financials, Cambridge, Perseus, 2000
  3. Jack Stack and Bo Burlingham, The Great Game of Business, Doubleday, 1992
  4. Jill Albrinck, Jennifer Hornery, David Kletter, and Gary Neilson, “Adventures in Corporate Venturing,” s+b, First Quarter 2001; Click here.
  5. Lucien Rhodes and Patricia Amend, “The Turnaround: How a Dying Division of International Harvester Became One of America’s Most Competitive Small Companies,” Inc., August 1986; Click here.
  6. The Great Game of Business: www.greatgame.com
 
Close
Sign up to receive s+b newsletters and get a FREE Strategy eBook

You will initially receive up to two newsletters/week. You can unsubscribe from any newsletter by using the link found in each newsletter.

Close