Patience and Persistence for Results

,

Sometimes impatient business people get involved with nonprofits. The nonprofit’s goals may seem remote, the results unachievable. But I’ve learned that patience and persistence can produce powerful results.

In 1997 I traveled with Applied’s diverse Asia-Pacific team down the Yangtze River to China’s Three Gorges Dam. Construction on the dam had begun in 1994. It is now the world’s largest power station, designed in part to help control the floods that had killed many people along the path of the Yangtze River through the centuries.

Unfortunately, as I learned, the consequences of the dam on the health of the river ecosystem had been substantial. The dam itself created a reservoir for sediment and organic and industrial waste that no longer continued downstream, destroying water quality. Also, the project displaced over a million people and flooded dozens of cities, towns and villages where no efforts to remove toxins from foundries and other activities were conducted prior to the flooding.

As I looked at the murky river, the deforested slopes, and the many villages black from decades of burning coal and wood, the problems China faced seemed insurmountable. I became convinced that I had to do my part to help the world begin to repair damage from large-scale projects and haphazard development. This wouldn’t be easy; I would have to be patient and persistent.

In 2003 Hank Paulson, the CEO of Goldman Sachs, asked me to join The Nature Conservancy (TNC) Asia Pacific Council of business leaders. He and Lee Kuan Yew, the Prime Minister of Singapore, had created the council to advise TNC management in Asia. The council made a trip to Hong Kong and we discussed how TNC had the opportunity to work with the Chinese on a plan to protect large wilderness areas and improve the environment. Our work had begun.

TNC would continue to work with China to help it improve water management and dam-building strategies. This is very important since the Chinese will build most of the dams worldwide in the coming decades. A “Great Rivers Partnership” was formed around the Yangtze, the Mississippi, and the Pantanal in South America. This has led to improvements in dam building and freshwater river strategies in China, the U.S. and in Brazil and Colombia.

The conservation news from China these days is promising. I read recently that Stanford University ecologist Gretchen Daily says that China’s environmental conservation efforts are making a positive impact. “In the face of a deepening environmental crisis,” she says, “China has become very ambitious and innovative in its conservation science and policies and has implemented them on a breathtaking scale.”

While perhaps not as significant as the broader environmental programs, China’s conservation efforts have pulled the Giant panda off the endangered species list.

The Nature Conservancy remains extremely active in China, working to find solutions that allow China to develop and protect the full spectrum of its biodiversity, from pandas to people.

My experiences on TNC’s Asia Pacific Council gave me an entirely new and important perspective on conservation and environmental issues in Asia, and it allowed me to stay engaged in the rising importance of the region. It proved the value of patience and persistence.


In 1997, I traveled with Applied’s diverse Asia-Pacific team down the Yangtze River to China’s Three Gorges Dam.

Please Comment Below

How have you learned to be more patient and persistent in achieving your goals?

/0 Comments/by

Systems Thinking

This month I want to talk about systems thinking in the context of American relations with China and my experience working with China beginning the early 1980s.

International trade is very much in the headlines these days. After a period of expanded trade agreements over the last several decades, the new administration in Washington is leaning towards protectionism. A review of NAFTA (North American Free Trade Agreement), involving U.S. trade with both Canada and Mexico, is currently underway in Washington, Mexico City and Ottawa. Meanwhile, as noted in Business Insider, President Donald Trump keeps threatening trade spats with China, and then retreating. However in August, in the first direct trade measure against Beijing, President Trump authorized an inquiry into China’s alleged theft of intellectual property from the U.S.

When I was CEO of Applied Materials we invested in understanding and then cracking the technology markets in Asia, first in Japan and later in China.

China was a tough challenge. In the 1980s the Chinese semiconductor industry was at a much different stage than in the rest of Asia. Restrictions on the kind of technology that could be exported meant that we could not even sell most of our products to China. The Cultural Revolution had eliminated a decade of engineers that could be trained in this newly emerging electronic world. There was little money to purchase anything.

It might seem from all these factors that there was not much opportunity. We felt that there was.

In 1983, China was still mostly a mystery and a complicated place to do business. But some members of our team had contacts within the Chinese Consulate in San Francisco. The Vice Minister of Electronic Industries, Jiang Zemin, visited the United States, mainly to stop at a few companies on the East Coast and Texas.* When our team learned that he was stopping in San Francisco on his way back to China, they invited him to visit us. While he was on site taking a tour and meeting with me, we received word that he had been promoted to Minister of Electronic Industries. On the spot we invited him to a celebration and we took the delegation of about twelve to Ming’s Restaurant in Palo Alto for a Chinese banquet.

It was a memorable dinner in many ways. Jiang and I sat together and talked for about three hours. We discussed the outlook for Asia, the semiconductor industry, and the difficulties facing China. I was truly impressed with his experience. He had been educated in electrical engineering using English textbooks, he had gained experience in industry, and also worked for a time in the Russian auto industry. He spoke not only English, but Russian. In the three hours of discussion I perceived that despite our very different political orientations, our views about the future of technology were closely aligned.

The Chinese are tough competitors. They’re getting ahead of us in certain technologies, for example solar panels and drones. They’re bypassing computers and focusing on mobile.

The U.S. and China have to work closely together. We don’t want to make it too complicated. We need to have ways to address the differences between us. We need systems thinking— thinking about the whole system for long-term success. To thrive and succeed in a complex world, you can’t just slog forward every day checking off boxes in a linear fashion. You have to anticipate problems, process new variables, and adjust your strategy.

By operating with an open mind and with respect for others, we repeatedly disproved the popular wisdom that U.S. companies couldn’t succeed in Asia. It reinforced for me that diversity is an exciting and enriching dynamic in life and I saw that play out every day in the many cultures that pulled together at Applied Materials.

* Footnote: Yes, this is the same Jiang Zemin who became General Secretary of the Communist Party and President of The People’s Republic of China.

With China’s President Jiang Zemin, Shanghai, 2001

Please Comment Below

How do you move beyond the day-to-day slog to embrace the larger picture?

/0 Comments/by

Interview with Dan Hutcheson

Earlier this year I was interviewed by G. Dan Hutcheson for his well-known weVISION video series. The edited video, 30 minutes long, is available for free online, along with a transcript of our chat.

Dan is an old friend, not just of mine, but of the whole semiconductor industry. He is chairman of VLSIresearch, a provider of market research and analysis on the technical and business aspects of the semiconductor supply chain. The industry respects Dan as one of its top experts and marketing voices.

In the interview Dan very generously compared Applied Wisdom to Andy Grove’s Only the Paranoid Survive, noting he would put my book up beside Andy’s “especially if you are in the semiconductor equipment industry.” That’s a real honor.

In the interview, Dan asked me how a CEO can create an ethical organization.

I replied that a company will never be better than its leaders. At Applied Materials we tried to encourage everyone in a leadership position within the whole company, worldwide, that one of their first priorities was to walk the talk and provide leadership in ethical behavior. You need that as part of the trust you require with your customers. You really have to develop trust between your customers and your company. We worked very hard on that and it paid off: we got more business, with good products, and good service and they could trust us to work with them in an honest and ethical way.

Please Comment Below

Are you building trust with your customers and within your organization?

/0 Comments/by

THE UBER LESSON

At some point in almost every fast-growing company’s life there is a moment when a manager realizes business as usual is not going to cut it. As a leader you have to face facts: Change or fail.

I was reminded of this recently from stories about the ride-sharing service Uber. Among other criticisms, a former employee alleged in a blog post that she experienced sexual harassment from a superior and reported it. She says she was told it was the first that human resources had heard of the issue and that the offending manager was a good performer and would only be warned. She chose to transfer to another work group. After the transfer, though, she met other women who’d had the same experience with the same manager and other managers, and who said they’d reported it.

As word of this employee’s experience spread, other employees and former employees started reporting additional claims about a toxic workplace culture. Uber launched an investigation. I know nothing beyond what I read in the papers about the details of this situation. But from a distance I recognize a familiar scenario, one I’ve seen repeated in company after company in Silicon Valley, where I’ve worked for over 40 years. Energized with a mission and intensely focused on meeting milestones, executives adopt the posture of the three wise monkeys on the archway at the Tōshō-gū shrine in Nikkō, Japan who suggest, “See no evil, hear no evil, speak no evil.”

In my book Applied Wisdom: Bad News Is Good News If You Do Something About It, I talk about the management principles that helped me build the semiconductor equipment company Applied Materials from a small, near-bankrupt player in a crowded field into a multi-billion dollar global corporation with 15,000 employees. I served as CEO for almost 30 years, and we built a corporate culture we were proud of and that delivered bottom-line results.

It’s easy to get caught up in the mythology of changing the world or reinventing a category of technology or business. But the secret of managing success is paying attention to a handful of basic principles that apply in any kind of organization, whether a start-up or an established business, whether of mundane consumer commodities or sophisticated web-based services. In fact, I learned many of these lessons as a kid growing up in Indiana and working in my family’s vegetable canning business.

In a canning plant, you sometimes hear a problem before you see or experience it some other way. You’re suddenly aware of a funny sound in a canning machine, or maybe a clicking along a conveyor belt. But you’re on deadline; the line is working full-speed. What do you do? You stop and fix a small problem before it becomes a big problem. My dad managed the plant that way every day, even when it was tempting to cross his fingers and hope that the problem would fix itself or go away.

At Applied Materials we refined the basics of this idea into a kind of management mantra: “Good news is no news; no news is bad news; bad news is good news—if you do something about it.” Let me deconstruct that in the context of a CEO and a public company’s board.

At many board meetings the bulk of time is spent in CEO-orchestrated cheerleading. The CEO marches out all the accomplishments, the regional sales upticks, the promising advances in the lab, the great new executive team hire, the news that the company’s won some community award. Since the board sets the CEO’s pay, it’s not surprising she or he wants to make sure accomplishments are noted—but, generally speaking, what a waste of a board’s time! Beyond agreeing it’s all great, what is there to do or say about what’s going well? The board’s collective time and experience are wasted.

No news, on the other hand, is ominous. A board exists to help and coach and support a CEO in the difficult decisions of growth and management. If you are not hearing anything from the CEO about difficult challenges, something is wrong. There are always challenges, always competitive threats developing, always less than happy customers, always personnel issues to be resolved. The silence is as loud as the unfamiliar knocking in a canning line motor. If a manager is repeatedly acting inappropriately, you have a problem. Seek counsel. Act. You need to investigate when the problem is still small and keep it from growing.

Bad news can be your best friend. Bad news is what should take up the bulk of a board’s time even when the bottom line is looking strong and the company appears to be thriving. Teaching your organization to take reports or even rumors of trouble seriously the first time, and then investigating and fixing the underlying problem, is how you ultimately build a successful organization that avoids the kind of eruptions and revelations of toxic culture that can chase customers and partners away. Build a culture where reporting a problem is rewarded, not punished.

There’s not a company in Silicon Valley, or anywhere else, whose success represents just a steady path forward and upward. Everyone hits challenges that demand change. The secret is to take your hands away from your ears, eyes, and mouth. Be alert to the bad news, report it, investigate it, and fix the problem.

Please Comment Below

Have you found occasions where your organization wouldn’t confront bad news, failing to recognize that bad news can be their best friend?

/0 Comments/by