1. Introduction: From Ideas to Practice Aligning the Stars “The book’s title reveals our bottom line: Outstanding firms are consistently able to identify, attract, and retain star performers; to get stars committed to their firm’s strategy; to manage stars across geographic distance, business lines, and generations; to govern and lead so that both the organization and its stars prosper and feel rewarded. These capabilities are what give great firms their competitive advantage. Together, they constitute the work of aligning the stars.” Achieving Alignment “Achieving Alignment involves understanding that your organization is a system in which every decision influences – and is influenced by - every other decision, and then making choices that will reinforce its strategy and values.” Chapter 2: Impact and Influence, The World of Professional Services Not Just People, But Stars “Professional service firms depend not just on ‘people assets,’ but on stars. Who are an organization’s stars? They are the individuals who have the highest future value to the organization, the men and women in critical jobs whose performance is central to the company’s success.” Who are these Stars? “In professional service firms, stars are typically ‘partners,’ but not all partners are stars, nor are all stars partners….What makes professional service firm stars ‘stars’ is the fact that they propel the business model along all three of its dimensions: building enduring client relationships, consistently performing up to their full potential and putting the firm first, and implementing strategic imperatives.” Chapter 3: Strategy, Necessary But Not Sufficient Strategy is Critical “Strategy is not an episodic phenomenon – it is always critical to an enterprise’s long-term success. The best firms understand this, thinking and acting strategically in good times as well as bad. Doing so requires a clear definition of strategy and an understanding of its central elements.” Stars and Strategy “Just as business enterprises have goals, so too do the individuals they employ. In the case of professional service firms, the two are entwined because the professionals who manage, lead, and own shares in the firm are the same people who compete in the marketplace for clients.” Chapter 4: Turning Talent into Stars, The Enduring Edge Starmakers “…There is another core competency that is more important than rainmaking to a firm’s long-term success; we call it starmaking. Starmaking is an organization’s competency at attracting, retaining, developing, and motivating star talent – the future professionals and leaders who build the firm from generation to generation…They, and the starmaking firms that they work for, understand the basic fact of life in professional service firms: The people you pay are more important over time than the people who pay you.” You Will Become Who You Hire Great recruiters…identify the skills, preparation, and attitude people need to contribute to the firm’s success. They identify where the people who possess those attributes are likely to be found. Then they pursue those people vigorously because they know that if the recruiting isn’t right, even the best developmental efforts will come to naught. Chapter 5: Guiding Your Brightest Stars, The Three-Hat Challenge The Brightest Stars “Partner-level stars are a firm’s scarcest and most valuable resource. Whether the firm succeeds or fails depends on their performance and leadership; How wisely and productively they allocate their time. How effectively they fulfill their client and management responsibilities. How committed they are to the long-term prosperity and growth of the firm. Success depends, in short, on the degree to which the firm’s goals are these stars’ goals – and vice versa.” Guiding not Managing “Although certain positions, such as managing partner and office manager, carry formal leadership responsibilities, any and all of a firm’s senior people have the potential to exercise leadership every day. The reason is that the central test of leadership is the ability to influence others to do things that they might not do if left to their own devices.” Chapter 6: Organization, Aligning Stars and Strategy Organization “Properly understood, organization encompasses a set of critical choices that every firm must make: About how it will attract, develop, evaluate, and reward its people. About its management structure. And about its governance, including the form and distribution of its ownership. On a day-to-day basis, these choices can surface as seemingly discrete and independent decisions. In fact, they are closely connected, and decisions made along one dimension sooner or later reverberate along the others.” Partnership Under Seige “Today, partnership is under siege. Not just the structure of partnership, but even the spirit of partnership that so many firms have tried to retain. Less than a decade ago, most U.S. professional service firms looked similar… Within the past decade, more and more best-of-breed firms have decided to expand their service offerings and to become international, if not truly global. Most of those firms are growing through acquisitions and mergers as well as through more rapid internal expansion.” Chapter 7: Culture, A Force for Alignment Managing Culture “Culture is dynamic. And whether you know it or not, you manage it on a daily basis. You shape the culture of your firm by the decisions you make or facilitate, which then affect behavior, which subsequently becomes part of ‘how things are done here.’ You may be reinforcing the culture you inherited though your actions; you may also be breaking new ground, changing the culture of your firm, slightly or drastically, and significantly affecting your firm’s competitive position as you do.” Survival of the Culturally Fit “While every organization’s culture is distinctive and in many ways unique, outstanding firms are remarkably similar in the norms and beliefs that constitute their cultural core….These core beliefs guide the firm’s behavior through business cycles and generations, exerting a powerful force for cohesion and ensuring their survival.” Chapter 8: Leadership without Control, The Power to Pursuade Constraints of the CEO “Chief executives lead professional service firms like boxers with one hand tied behind their backs. Although they are held – and hold themselves – personally accountable for the firm’s success, they lack the authority vested in a typical corporate chieftain. Sometimes their titles reflect these constraints: They are ‘managing partners,’ ‘senior partners,’ or ‘managing directors.’ Regardless of their titles, rarely in business does effective leadership demand such skill and finesse while yielding such enduring benefits to an organization.” The Alignment Architect “If anyone is in the position to be alignment’s architect it is the CEO. He is the person at the center of the strategic and organizational decisions that move a firm into (or out of) alignment. It is the CEO’s job to develop a broad perspective across all the firm’s practices and offices, a personal knowledge of many of its professionals and all of its stars, and a sense of the firm’s future needs and the choices that will be required to address them.” Chapter 9: Aligning Your Star, Build a Life - Not a Resume Aligning Your Own Star “Like an organization, an individual’s decisions and behavior can be aligned with his or her own capabilities, goals, needs, and values or not. Such personal alignment is hard to calibrate on any given day. But its presence (or absence) almost always becomes apparent over time, as life unfolds.” Build a Life, Not a Resume “Those that succeed build lives as well as resumes. When they stare into the mirror, they don’t see just a professional; they see a parent, a spouse, a friend, and a member of the community. They assess their progress objectively against a broad multidimensional scorecard, on which their resume is only one of the indicators. They are never fully aligned, but always aligning. They struggle, fail, and ultimately succeed.”