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 Comebacks
By Tom Pryor
Will
activity-based costing make a comeback? This question was posed to readers
of the October 23, 2003 issue of Economist magazine.
What
is a comeback? According to Webster's Dictionary, comeback
is "a return to former success or status." During the 1970's
I enjoyed watching Roger Staubach bring the Dallas Cowboys from 4th quarter
deficits to Super Bowl comeback victories. During the 80's I remember
Lee Iacocca leading Chrysler from the brink of bankruptcy back to place
of profitability. And during the 90's I watched my Mom and Dad comeback
from a catastrophic car accident.
Most
people enjoy watching a comeback or hearing a great comeback story, but
few people actually participate in one. That's because it's easier to
fallback than it is to comeback.
What's
needed for a comeback?
If you or your organization has fallen on hard times, it will take more
than an improving economy to make 2004 a comeback year. To return to
a former level of success or beyond, your comeback will need help.
- Comebacks
need tenacity… My wife and I saw a comeback story
last weekend. Russell Crowe's new movie, Master and Commander,
is an exciting movie of how the captain of H.M.S. Surprise, Jack Aubrey,
recovers his ship and crew from a surprise setback attack launched
by Napoleon's navy. Captain Jack was a tenacious, focused leader.
Tenacious people are persistent, holding firm, retaining a desire
to be successful. Instead of limping his damaged ship, crew and ego
back to port, Captain Jack planned and lead his ship to an exciting
comeback.
- Comebacks
need some humor… Comebacks take hard work and time.
Humor lightens the load for the journey back. To the wife of New York
City Mayor John Lindsay, who said that he looked cool, Yogi Berra
replied, "Thanks. You don't look so hot yourself."
Funny comebacks after a serious setback help you and others regroup
and regain momentum towards your goals.
- Comebacks
need a meaningful cause… How badly do you want your
business, branch office, factory, ABC project, marriage, friendship,
family, church or life to thrive once again? Without a meaningful
desire, comebacks rarely begin. My 82-yearold father lost his wife
of fifty-seven years on October 7th. In the past three weeks, I've
watched Dad begin to make his four great-grandsons a new purpose for
his life. Dad's positive attitude is coming back. Ask yourself, "What
is truly worth saving?" If your answer is meaningful, you'll
do almost anything to achieve a comeback.
- Comebacks
need a foundation of truth… "The fact is that
people will give their lives for what they believe is true, but they
will never give their lives for what they know is a lie." (2)
People and organizations living a lie rarely make comebacks. Lies
provide nothing to pull yourself up. Comebacks begin and end with
truth. If your company needs a comeback, make sure that everyone …
customers, employees, suppliers and yourself … believe the organization's
products or services represent true value. If uncertain … ask!
- Comebacks
need one of two words… "It boils down to the
choice of two common words in our vocabulary. Little words, but, oh,
so different! Can't and won't." (3)
It seems that most people prefer can't:
"I can't get along with my wife."
"I can't find time to pray."
"I can't find any new customers."
"I can't implement ABC."
"I can't stop overeating."
Comebacks begin when you change can't to won't. The day I changed
to "I won't stop overeating" is the day I became
responsible for my behavior and begin to lose weight.
- Comebacks
need a dismantling of the present to secure the future…
Management coach Jim Seybert says, "The degree to which you'll
succeed in the future depends on your ability to imagine a tomorrow
that looks nothing like today." (4)
Louis Gerstner, Jr.'s Who
Says Elephants Can't Dance documents the successful business
comeback story of IBM. Gertsner dismantled the company hemorrhaging
a $16 billion loss in 1993 and rebuilt IBM's product and services
to a profitable, market leadership position before he retired in 2002.
What are you doing today that won't work in 2004?
- Comebacks
need a leader… Every successful businessperson has
had setbacks. Those people who realize that setbacks are simply part
of the business process usually thrive, while those who dwell on setbacks
routinely falter. Comebacks need leaders who accept the notion that
setbacks are really changes that needs to occur to move forward. Look
in the mirror. The reflection you see is the person who is needed
for a time such as this… it's time for a comeback.
In
1995, Activity Based Costing was the 11th most widely used management
tool. ABC fell to 22nd place in 2002. (5)
According to Economist magazine, "Robert Kaplan, a Harvard
Business School professor, is trying to revive it. His new, improved ABC,
he says, 'is embarrassingly simple.' It is time-based and calculates the
cost of one minute of overhead and then decides how much of this time
each activity uses." (6)
Comebacks
are simple to watch but not simplistic to achieve. ABC is making
a comeback because the need for improved cost management and decision-making
information has not gone away. ABC solutions are getting simpler and better.
In addition to the simpler approach being developed by Professor Kaplan,
work is also underway at ICMS:
- ICMS'
Gross Margin Profiling, a simpler method of ABC developed in late
2002, has helped grow sales and profit for distribution, home care,
service and manufacturing firms in 2003.
- The
Principles, our new book co-authored with Barry Cameron,
explains ten principles that can simultaneously turnaround a business
and a person's life. The book will be available December 5, 2003.
-
Development of a simpler, more powerful Version 5.0 of our popularly
priced CMS-PC software is well underway and expected for early 2004.
In
recent weeks, my attention has been directed to watching the comebacks
of the Dallas Cowboys and Rush Limbaugh. Based on recommendations from
Economist, I've added ABC to my list. Not to just watch, but to also participate.
What comebacks are on your list?
(1)
Easier than ABC, Economist, October 23, 2003
(2) A
Dangerous Grace, Chuck Colson, Word Publishing, 1994
(3) Come
Before Winter, Charles Swindoll, Multnomah Press, 1985
(4) Market Intelligence, Jim Seybert,
JimSeybert.com, November 2003
(5) According to Bain & Company's
Annual Survey... www.bain.com/tools
(6)
Easier than ABC, Economist, October 23, 2003
Send
your comments on this article to Tom Pryor at TomPryor@icms.net.
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