“Winning Now, Winning Later” is one of the best books by a CEO that I’ve read. The stories of how David turned Honeywell around were relatable, even to me, a CEO of a small company. Why?
Book Review of “Winning Now, Winning Later: How Companies Can Succeed in the Short Term While Investing for the Long Term” by David M Cote, Former CEO of Honeywell
Kerry’s Book Review
There isn’t a CEO on the planet who isn’t struggling with balancing long-term success with the pressure to meet short-term financial metrics. I am always in this battle with myself and my team. We oscillate between overinvesting in the long term at the expense of the short term. Then the pendulum swings the other way, and we make too deep of cuts that hurt our long-term innovation. David gave great examples of how he invested in Honeywell’s most critical future initiatives while holding operating expenses constant. There is no doubt it isn’t easy, but he gave me all kinds of ideas on doing it better.
I love the idea of holding two competing ideas in my mind at once. This is systems thinking at it’s best. You can invest in the long term while meeting short-term KPIs. You can invest and cut at the same time. You can agree and disagree at the same time. Why, because running a business isn’t as simple as a yes or no, right or wrong, now or later. Business is an ecosystem – everything affects everything. And it takes time for strategies to play out, and you need to be able to do effectively do seemingly opposite and competing activities at the same time.
His story on how he found his successor was inspiring. Someday, I will be ready to hand the reigns over to someone else, and it’s essential to me, the board, and the company that this person comes from within. It’s hard to develop your successor ten years out. Still, David walks us through his rigorous process of giving high potential employees hard projects and important initiatives to see how they handle them. Over 5 years, they were able to narrow down the pool to a top few. These top few people were given even more responsibility, testing their fortitude, decision-making process, thinking and team-building skills. Two years out from retirement, David was able to select his top choice and slowly (and successfully) transition the company’s leadership to a new CEO over the next 18 months. Very inspiring and worthy of following his methodology.
My two favorite quotes of the book: “The higher up the flagpole you climb, the more people see your ass” and “If you are going to fail, at least do it differently”.
- Never use accounting magic to make your numbers look good. It will always cost you in the long run, and you have no idea how your business is truly performing.
- If you push your team to hold expenses, they will find all kinds of ways to make it happen. You have to ask and then hold them accountable.
- Surround yourself with people who think independently and find ways to brainstorm so you don’t get stuck in groupthink. You’ll get better ideas, stronger leaders, and ultimately a better company. But you must check your ego at the door.
- Tackle one problem at a time. You can’t do it all at once, and if you try, you’ll fail.
About the Author
When David M. Cote became CEO of Honeywell in 2002, the company was a “train wreck.” But by pursuing both short and long-term results under Cote’s leadership over 16 years, Honeywell’s market cap grew from 20 to 120 billion dollars, delivering returns of 800 percent and beating the S&P by nearly two and a half times.
Cote is one of the most successful CEOs of his generation and is highly praised for how he skillfully navigated the Great Recession at Honeywell, providing today’s leaders with strong advice for navigating the fluctuating economy.
Want more on this topic? Check out this post on how to be an accountable leader.
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