Essential skills for business growth and profitability

Ram Charan explains how to be a better leader and make the right decisions

A review of Know-How: The 8 Skills that Separate People Who Perform From Those Who Don’t. By Ram Charan. Published by Crown Business.

Reviewed by Patrick Buckley, CMA, PhD

Finding someone to help with day-to-day business problems is often difficult. One individual who has helped many leaders of Fortune 500 companies is Ram Charan. The kernel of his thinking is in his book Know-How: The 8 Skills that Separate People Who Perform From Those Who Don’t. Charan provides insights for managers to follow so that their organizations will continue to prosper and grow. These insights are supported by real-world examples that Charan has collected over four decades of management consulting. Charan ended a tenured university professorship 30 years ago to peruse management consulting full-time.

The book Know-How begins with a section on the importance of understanding how a business makes money, and how product positioning needs to be changed when there are warning signs of declining patronage when loyal customers start to go elsewhere. This section flows into the next topic where change is approached directly. Is the change permanent or just cyclical? How do a firm’s products and services need to respond to changing external forces? According to Charan, an important point is to realize that change is happening.

The next three sections of Know-How focus on the human aspects of management: resolving conflicts, developing leaders, and molding a winning leadership team. Conflicts need to be resolved so that information will flow across the silos. Leaders need to be given room to develop and the leadership team needs to respect each other and work together for the good of the total enterprise.

The next two chapters of Know-How are about setting goals. These link back to the chapter on change, which describes how goals will challenge a company to respond to new market opportunities, how the company will fit in the emerging global economy and what is a company’s road map for achieving its goals?

Charan concludes Know-How with a section on dealing with societal forces that are the focus of interest groups. These are forces like global warming and increasing energy costs. A firm needs to deal with interest groups to avoid being caught in the cross-fire. Dealing with external forces is increasingly important since the Internet has made company actions more transparent.

Overall, Know-How is a noteworthy book about how to have a successful enterprise. Charan shows readers how to be better leaders by integrating their business knowledge with his management concepts.

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