Monday, September 1, 2014

Boston Beer Founder Jim Koch on Leadership

Jim Koch has run a successful business, since he launched Boston Beer Co. in 1984, which is now doing more than $700 million in sales.  His attitude about specialty beers and his competitors is not only refreshing but also instructive.  Athletes are fierce competitors on the field, but off of it many of them are good friends.  Koch doesn't want to hate his competitors, but wants instead to have a beer with them and enjoy their company.  Building such a friendship may underlie the kind of business cooperation he imagines:  There are 3000 specialty beer companies, and together they represent just 7% of the market.  If they work together, they can build that market.

Boston Beer is obviously not a technology company.  But the things that Koch mentions as the advantages of a small company, in the face of giants, is a parallel phenomenon with what goes on in the technology industry.  That is, small companies have the privilege of nimbleness, and they can translate this into more expedient decision-making and faster to market innovations.  They are the David to the Goliath, who may not have the agility or speed to respond to certain market opportunities and threats.

The leadership lessons Koch has learned are organic. That is, they are outcrops from what he has experienced in running a company and working with people:
  • The leader is never tired, and never has a bad day. The leader has to have more energy and spirit than everybody else, because you cannot expect more of your people than you expect of yourself.
  • Culture and values can substitute for resources, like good equipment, food or supplies.
  • People don't care what you tell them, instead they care about what you do. You're always visible.
Indeed being a leader is a tall order.

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