| One company that has been at the forefront of innovation is FedEx. When Fred Smith set up the company in the early 1970s, its main business was simple. It would deliver overnight Federal Reserve cheques to its 36 outstation locations. Hence the name Federal Express or FedEx. |
| Since then, FedEx has come a long way. Thomas Friedman, in his bestseller The World is Flat, waxes eloquent on how FedEx has used innovation in a global economy to stay a step ahead of competition. |
| For some strange reason, nobody has bothered to chronicle FedEx's phenomenal success""how it has managed to stay on top in a hugely competitive business. The functioning of the world's largest logistics company was always a story waiting to be told. There was nothing to whet the growing appetite to know about the FedEx Way. |
| Madan Birla's FedEx Delivers fills the gap. Birla joined FedEx in 1979 and worked at the company for the next 22 years. He was a member of FedEx's Long Range Planning Committee, which gave him an opportunity to work closely with Fred Smith. He has travelled widely with FedEx delivery personnel. He won not once but twice the coveted Five Star Award, the highest recognition for leadership excellence at FedEx. More than anything else, he developed rare insights into the functioning of the company -- how FedEx managed to stay ahead of its rivals. |
| There is no formula for innovation. What might have worked well in one situation need not work to the same effect in another. In that case, is there a key to innovation? What is the common denominator? |
| The central message of Birla's book is that a company's leadership should encourage all employees to think of innovative ways of doing business. A car might have a great engine. But it won't run unless the engine has been engaged. In the same fashion, a company needs to engage its employees if it wants to adopt a culture of innovation. |
| People like Fred Smith, Sam Walton and Walt Disney were great innovators. They saw a business opportunity and moved in quickly. Great. But would that have been good enough to catapult their businesses (FedEx, Wal-Mart and Walt Disney, respectively) to greatness? |
| Not really. Though the initial thrust came from these visionary businessmen, these companies would not have scaled the heights they have had it not been for the constant innovation carried out by their employees. |
| The next question is, how do you encourage your employees to innovate all the time? How do you make them think non-stop about how to improve operational efficiencies? |
| Birla's advice, drawn from his long experience at FedEx, is simple. To begin with, all employees need to be made stakeholders in the success of the company. Their own fortunes need to be linked with the success of the company. Once employee commitment is sought and won, it is the duty of the team leaders to tap it. In short, create commitment and then use it to good effect. |
| Birla also says that companies need to create a secure environment for their employees. It is now widely accepted that it is only in a secure environment that creative ideas thrive. Innovation cannot flourish if employees feel insecure at the workplace. |
| After turning the last page of Birla's book, one wonders about the track record of Indian companies. Is their innovation quotient high or low? It is actually a mixed bag. There is a large pool of Indian companies that have made a mark for themselves in the global arena with their innovative business practices""Reliance Industries, Bharti, Hero Honda, TCS and so on are good examples. |
| But a large number still have a long way to go. Birla's book could be a good starting point for them. FEDEX DELIVERS HOW THE WORLD'S LEADING SHIPPING COMPANY KEEPS INNOVATING AND OUTPERFORMING THE COMPETITION |
| Madan Birla John Wiley & Sons Price: $24.95; Pages: 215 |
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