When George Stalk talks about hardball, he's not referring to baseball or, indeed, any other game. The author of a previous book titled, Competing Against Time, Stalk recently co-wrote, Hardball: Are You Playing to Play or Playing to Win? with Rob Lachenauer, CEO of GEO2 Technologies, a car-engine technology firm. The book argues that hardball is a way of doing business that aims at sweeping aside rivals and leaves them sitting on their rear, wondering just what hit them. Wharton's Michael Useem, director of the school's Center for Leadership and Change Management, recently spoke with Stalk, a senior vice president in The Boston Consulting Group's Toronto office, about why companies that play the toughest often deliver the most value to their shareholders. Two Knowledge@Wharton writers also participated in the conversation.
Useem: How would you define hardball at work in business?
Stalk: Let me break that question into two parts. First there is the manifest Companies with hardball strategies understand that competitive advantage creates shareholder value, and that competitive advantage can be sought. They also know that if you find what we in our book call a decisive or unassailable advantage, it may be so great that perhaps competitors may consider it to be unfair.
Second, how do you know you're a hardball player? One measure is if you're growing faster than your competitors. Also, is your performance superior - not just in terms of growth, but also in profitability, working capital turns and shareholder equity? Another measure is informational: Do you know more about your customers and competitors, and their costs and prices, than they know about yours? Do you know where your company and its competitors make money, and why they make money? And do you use that knowledge?
Useem: Would you single out an example of playing hardball? In your book you include examples from Toyota, Southwest Airlines and even a casket maker.
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