Financials? What Financials?

A quick quote from a CFO about the importance of open-book management at his copper mine and why.

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"Two guys are walking through the jungle when a lion appears on the path ahead of them. One of the two starts putting on a pair of running shoes. 'Why bother with running shoes?' says the first. 'There's no way you can outrun a lion.' 'Who said anything about outrunning a lion?' says the second. 'I just want to outrun you."

-- Ichak Adizes, author of Corporate Lifecycles: How and Why Corporations Grow and Die and What to Do About It (Prentice Hall, 1988), on the importance of knowing what it takes to win in a competitive environment

One way to determine the real value of a management practice is to stop doing it and see what happens. "Believe it or not, we did just that with our monthly financial statements," said Deepak Malik, a financial officer of Zambia Consolidated Copper Mines Ltd., at the recent Gathering of Games, a conference of companies practicing open-book management. "One month we simply didn't publish them, and we discovered their real value, all right. No one noticed -- not even top management. We found out it was taking so long for the accountants to close the books that by the time the numbers were released, they were perceived as useless. So now the manager of each division prepares his own income statement -- often by hand -- and we have our monthly 'report cards' within days of the close of the month. They may be off by a percentage point or two, but people read them and pay attention to them."

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