Wellesley, Mass…Eroding investor faith in the broader corporate systems has made the ability to discern and believe in a company’s value more important than ever. With VALUE LEADERSHIP: The 7 Principles that Drive Corporate Value in Any Economy (Jossey-Bass/Wiley, October 2003, $27.95, Cloth), Babson College Executive-in-Residence, Peter Cohan, offers a clear strategy for executives to recognize as well as build a system of value creation that will be effective in both good and bad economic climates.
"The last three years have placed enormous pressure on executives and investors," says Cohan, "expecting government reforms to lift the pressure and renew corporate confidence is akin to believing that a new referee can turn a last place football team into a Super Bowl winner. To restore confidence in equity capitalism, executives must revive themselves. Value Leadership provides the principles, inspirational stories, and tools to fuel that revival."
Value Leadership relies on a healthy relationship between a company and its employees, customers, investors, and community. By providing competitively superior value and orchestrating the relationships among these groups, companies can create a self-sustaining system of value creation.
In addition, a company must implement a system of value creation that is adaptable to change, and grows with the company and marketplace. To help measure corporate value leadership, Cohan provides a Value Quotient calculator which produces a tangible signifier of value in order to compare companies across industries.
The concept of Value Leadership arose from a comparison of companies that emerged as Value Leaders when evaluated based on the seven components of the Value Quotient:
1. Value Human Relationships: Treat people with respect so they achieve their full potential consistent with the company’s interests.
2. Foster Teamwork: Get people with different functional skills and responsibilities to work together to advance the interests of the corporation.
3. Experiment Frugally: Harness accidental discoveries to create value for customers and partners.
4. Fulfill Your Commitments: Say what you intend to do, and do what you say.
5. Fight Complacency: Weed out arrogance.
6. Win Through Multiple Means: Use strategy to sustain market leadership.
7. Give to Your Community: Transfer corporate resources to society.
While not perfect, these Value Leader companies (including Wal-Mart, Southwest Airlines, and Goldman Sachs) ranked high consistently in all seven principles, and through two recessions grew 35% faster and were 109% more profitable. In VALUE LEADERSHIP, Peter Cohan—a renowned management and investment expert whose 2002 stock picks gained 81% when the S&P 500 plunged 24%— uses his expertise in understanding shareholder value to guide executives through the evaluation of a company’s Value Quotient, and implementation of the seven principles to introduce a lasting value-creation system. Beyond the immense positive impact that Value Leadership has on a single company, adoption of the seven principles by business leaders is a step on the road to restoring confidence in American capitalism.
"Value Leadership is one of the best books that I have ever read because it addresses all the stakeholders -- from employees and customers to board members and investors. Peter Cohan's Value Quotient is an excellent, pragmatic model. If I were running a corporation today, I would adopt his philosophy and process. I encourage business leaders faced with today's challenges to read it." — Bill Redgate, founder and Executive Director, The Center for Values Based Leadership, Sacred Heart University, Fairfield, CT
“It's so easy to commit conceptually to Value Leadership, but so hard to implement that commitment in a sustained way and to achieve best-in-class results. Cohan provides guidelines for a systematic approach to both implementation and measurement of value leadership derived from his in-depth studies of companies that demonstrate sustained value leadership. The world needs more value leaders. Peter Cohan can help.” --Mark P. Rice, Murata Dean F. W. Olin Graduate School of Business, Babson College
About the Author: Peter S. Cohan is president of Peter S. Cohan & Associates, a management consulting and venture capital firm, and executive-in-residence at Babson College in Wellesley, MA. He is the author of seven books, including The Technology Leaders, which was selected as one of the 10 best management books of 1997 by Management General and Net Profit, which the Washington Post called “A savvy, discriminating guide to Internet business.” He has appeared on Good Morning America, CNN, and CNBC, and has been quoted in the New York Times, Time, Fortune, and Business Week.
