Excellence is an overused word. Every claims they are aiming for it, but almost no one pulls it off.
It’s a word found on countless PowerPoints, company culture pages, and brochures that its true meaning has been lost.
My time at McKinsey made me believe that excellence in possible but that it is not common. It was a period of unconstrained personal growth where I did work far beyond what I thought possible. But I didn’t appreciate how rare that was until working at consulting firms where I found it incredibly hard to do that same level of work.
Over time I’ve realized that excellence can never be proclaimed from the top, it must be emergent out of a strong process and culture.
I’ve also realized that excellence is rare and that without experience working in such environments, many people do not know what they are capable of.
Part of my mission with StrategyU is to help more people realize that doing great work is possible and that it is not a result of inherent genius, but downstream of processes embedded at a team level.
Real excellence is cultivated
After leaving McKinsey and working at other firms, I felt like I was being held back by invisible constraints.
Why couldn’t I complete my work at the level I was capable of at McKinsey?
All these places had leaders who said the right things and talked about building cultures of high performance, high standards, and excellence but the lived reality always fell short.
From working with many different organizations as a consultant, I’ve started to notice that the companies that are able to build a culture of excellence all have a few things in common. Specifically, they all:
#1 Have a top-management mindset
#2 Obsess over process and meta-process
#3 Embrace clear “standards of performance”
Principle #1: Top Management Mindset – Have employees that can think “from the top“
Many people operating inside companies are laser-focused on the everyday tasks of their jobs. This is normal, and something that makes sense because you need a steady state of operations that is consistent and reliable to keep the business running. But at the individual level, this will not only sabotage your career growth, it will undermine any chance that your company can build a collective spirit of doing great work.
To do great work, you need to put information in context and to put your tasks in context, you need to have an understanding of what your business actually does.
Is your marketing group responsible for click-through rates? Or is that just an operationalized way of helping the company execute its digital transformation?
As knowledge work and processes have become more specialized, people have become increasingly disconnected from any sense of what their organization does. This makes it incredibly hard for people across organizations to interface with each other, not to mention employees working more closely with customers or clients to solve their problems.
At McKinsey, one of the cultural values was to “follow the top management approach.”
Thinking from the top meant filtering almost everything we were doing through the eyes of the CEO and Board of our client organization. Even if we were working in the “back office” of the consulting team, we would obsessively research everything we could find about the company from external and internal sources.
This mindset helped McKinsey always influence the most senior levels of any organization they worked with because when you understand the biggest issues like industry trends, competitors, and shareholder return, you can also have a seat at the table to talk about the most challenging issues when they arise.
With many of my current clients, I ask: have you researched your customers or clients? If so, how much?
They might say yes initially but then I ask if they’ve read strategy reports, investor documents, done store visits (if appropriate), and done interviews to understand their clients better. Most say they haven’t done any of that. They never thought of it.
They are hiring us at StrategyU to help “make better slides,” but often we end up trying to help them understand what the best firms in their field are doing: obsessing over information, getting inside the brains of their most important stakeholders, and being more curious than everyone in their industry.
This applies inside an organization too
To do great work, every person in your organization needs to understand how the work fits into the bigger picture. If your entry-level people don’t understand the context of the conversations the CEO is having with the most important stakeholders, they are missing important clues that will enable them to create high-value work.
One of the biggest hurdles to this is that naturally, senior people are more externally-focused and internal people are more internal-focused.
The CEO and analyst literally speak different languages. They describe similar things but at different levels of detail and for very different audiences.
In order for your teams within the company to thrive, this “top-management” thinking must spread throughout the organization.
At Amazon, everyone inside the company knows that the customer is first. The leaders talk about it all the time, mythologized it with stories, and reward that behavior inside the company.
We tend to glorify words like “Strategy,” but strategy isn’t that complex.
It’s usually a simple prioritization of what the company cares about, the specific investments the company is making in the next 2-3 years, and short-term plans to execute on those plans.
The reason people get confused is that often “Strategy” gets explained in overly complex strategy decks, with dozens of pages.
But usually, there is a simpler explanation. You can find it in corporate strategy documents, earnings call transcripts, press, and public interviews.
If the company is public, you can go to the investor relations tab and download presentations from recent investor conferences. For example, a quick look on Walmart’s site leads to this two-page letter that Walmart’s CEO addressed to the company’s shareholders in 203:
We can learn a whole lot about Walmart’s strategy for the coming year from just this screenshot, for example:
One of Walmart’s aspirations is to be a regenerative company that helps people live better by –
- saving people time
- helping them improve their health
- providing tools to save on financial transactions
- strengthening their communities and the planet
You might roll your eyes but if you are working for Walmart or want Walmart to become a customer, this information is valuable. To Walmart, these are all important things that they likely have dozens of initiatives and millions of dollars invested against. If I was a Walmart employee, I’d want to be thinking about how my role fit into the company achieving these goals.
In short, before doing any task, ask yourself what your CEO or your customer or client CEO would be optimizing for. Or if you are already thinking about these things, ask yourself why more people aren’t thinking about these questions.
Principle #2: Obsess over process and meta-process
I’ve worked at both McKinsey and Boston Consulting Group and while they might differ in many ways, one of the things they have in common is an obsession with process which I’ve found is rare outside of these firms and even rarer in the broader corporate world. At its best, consulting is selling a process not solutions which means one of the best uses of time is to obsess over the process.
At McKinsey, I was shocked at how much time was spent talking about the how.
Coming from GE, where I was given instructions on how to format my document correctly to not piss off our vice president, this was a relief.
This obsession with the process also comes from necessity. Almost every project I was involved in was a new collection of people and by focusing on how things would work within the team, we were able to get up to speed a lot faster. So spending a couple of hours talking about norms, preferences, communication styles, template format, and so on, upfront, only seems like a waste of time if everyone knew what to do.
Almost every week, there would be a review of the projects. We would ask each other: “Is our approach working?” “How do we need to think about working together differently?” This kind of relentless iteration can be hard and stressful but over time, through producing great work, you start to see its value.
Team artifacts serve as anchors and shared sources of “truth”
During these discussions, we would also allocate responsibilities between team members. We did this by asking questions like Who is the data wizard? Who will make sure we’re on time? Who is the domain expert? Defining these roles also promoted accountability and helped us determine the best person for each task.
To align as a team, we use structured artifacts, or documents, throughout the process.
For example, in the first phase of a project, you might have a team charter, problem definition, or issue tree.
In the second phase, you’d have ghost decks, various analysis templates, and an overall outline of the hypotheses and workstreams.
And in the final phase, you’d have structured ways of delivering different kinds of presentations like a “CEO deck,” executive memo. and full analysis deck.
With a clear set of deliverables, the team could then create a plan for when things needed to be complete. Then individuals could work backward to determine when their individual parts needed to be completed.
To keep make sure the team remains aligned, there would be weekly, if not daily, check-ins.
At weekly meetings, the team members would share the latest client materials. Whoever had worked on their specific parts would present to the project team and others would pretend to be the client. This would help simulate a client meeting and get early feedback. Only from there would team members test specific parts with clients (ideally friendly people inside the company) to get further feedback.
Principle #3: Create a high “standard of performance“
Establishing a culture of excellence is a futile endeavor if your team lacks a clear vision of what “great” looks like—and more crucially, what it feels like. However, before diving into cultural transformation, it’s imperative to ensure your business model supports the high-performance standards you’re aiming for.
In my experience, senior consulting leaders overlook the delicate connection between the business model, and specifically pricing, and high-performing behavior. From its inception, McKinsey embraced premium pricing. This wasn’t just about profits; it was a deliberate approach that followed a simple logic: higher prices lead to fewer projects, which in turn allows for greater focus and ultimately creates space to exceed client expectations.
I regularly encounter clients seeking to boost their team’s performance. A common refrain is that their teams are overwhelmed, staffed on many projects, and drowning in their work. When I hear this, two potential root causes come to mind: either the company is underpricing its services, or there’s a fundamental issue with talent acquisition and management.
Elizabeth Haas Edersheim, one of McKinsey’s first female partners, wrote about McKinsey’s philosophy in her book McKinsey’s Marvin Bower:
We started out in 1939 billing on a per-diem basis. That was common among accountants and other consulting firms. You’d just multiply the number of days by the rate and that’s the bill. In about 1941, I said, “This is ridiculous and we’ve got to change it. You cannot measure value by hours. Lawyers don’t and we shouldn’t. [At least that was the case in those years.] If we run up hours that aren’t valuable, we shouldn’t charge them.” And so we had quite a struggle among our partners to change fees to either a fixed lump sum decided in advance or a monthly fee with no per diems and an estimate of how long it takes. Lump sums..was a risky way because we couldn’t tell what the problems were, but after a struggle in the firm we got away from per-diem rates. Some partners were afraid that clients wouldn’t go for it..And it turned out to be an unfounded fear.
At McKinsey, Marvin Bower’s approach to setting the tone was to create form principles. These principles are still embraced today (and talked about a lot). In this essay I talked about how this is reinforced through onboarding video storytelling, in-person oral culture, and a yearly values day that talks about a few of the company values.
That brings me to my next point, McKinsey doesn’t just have values, it lives and breathes them.
Edersheim writes about Bower’s famous obsession with values:
The combination of value-based billing and expense control proved to be successful and provided the firm’s members a reasonable income with-out elevating the quest for revenue over freedom and independence. As Marvin has often noted, while obviously the firm must have the economics required to keep it running, there is a harsh downside to pursuing revenue goals and accepting assignments where a professional management consulting firm (or any professional firm, for that matter) cannot deliver value—namely, the destruction of the firm’s reputation to the detriment of future generations of employees, and possibly, the firm’s longevity.
David Ogilvy, a founder of the advertising firm Ogilvy & Mather, remembers learning this lesson: ‘Marvin Bower . . . believes that every company should have a written set of principles and purposes. So I drafted mine and sent them to Marvin for comment. On the first page I had listed seven purposes, starting with ‘earn an increased profit every year.’ Marvin gave me holy hell. He said that any service business that gave higher priority to profits than to serving its clients deserved to fail. So I relegated profit to seventh place on my list.
Once the business model is figured out, you must be extremely specific about your “standard of performance”
A great example about the importance of high standards comes from football — Bill Walsh coaching the 49ers. Walsh wrote in his book on leadership, The Score Takes Care of Itself:
Winners act like winners before they’re winners..The culture precedes positive results. It doesn’t get tacked on as an afterthought on your way to the victory stand. Champions behave like champions before they’re champions; they have a winning standard of performance before they are winners.
Walsh did simple, effective things to cultivate this winning “standard of performance.” While he detailed many, here are three specific ones that stand out:
- Exhibit a ferocious and intelligently applied work ethic directed at continual improvement.
- Promote internal communication that is both open and substantive.
- Maintain an ongoing level of concentration and focus that is abnormally high
Joe Montana, who played for Walsh and won four Super Bowls talked about why this worked:
You might think that trying to meet his extremely high expectations would tighten you up, but Bill didn’t jump on you for a mistake; he came right in with the correction: “Here’s what was wrong; this is how to do it right.
But it also wasn’t just high-pressure and intensity. It was fun too!
He had this little way of taking the pressure off with a comment or, on occasion, some sarcasm…Humor was one of his assets….He was extremely demanding without a lot of noise. He was supportive.
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