Kaizen critics on Innovation: Sustaining Innovation is not Kaizen!

The rapid change of the world makes innovation a lethal weapon to become a big part of solution to bring about countries, companies, or communities to a useful change that hopefully take them to the top the leading pack in the world. Little research on the topic could give many hints that innovation is the key. There are now disruptive innovation, cultural innovation, reverse innovation and other terms that use innovations as the key.

However, the overwhelming topic of innovation that filled the market has overshadowed some important not so radical, slow and not extreme change that comes from continuous improvement that actually be the backbone of many leading companies in the world. The power of kaizen culture which embedded in top leader of the pack has been uncover in the book The high-velocity edge by Steven Spear seems to be undermined by the amount of innovation books and its varieties on the market.

Java Printing

I am not against innovation because I understand that without innovation no companies could ever bare their existence let alone leading. innovation is the key. I really enjoy reading books on innovation especially books by Clayton M. Christensen which really is the result of his in-depth research and reflection about the world of innovation.

My argument about innovation is that most of the books on innovations discussed about big changes that will lead to strategic/big step. My take on current innovation paradigm is that innovation is not enough because we still need kaizen. Some people say that kaizen is innovation also, but it really is not. The rule of thumbs is what your mind perceived what innovation is, reduce it by factor of at least 100.

When for example Clayton M. Christensen tried to detail innovation into a more elaborate by dividing it further into Disruptive and Sustaining Innovation. People get confuse because first, where is then Kaizen? Second,  a strange combination of words is used (Sustaining Innovation!).

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The Innovator’s Dilemma (Christensen 1997) identified two distinct categories—sustaining and disruptive—based on the circumstances of innovation.

  1. Sustaining Innovation : when the race entails making better products that can be sold for more money to attractive customers—we found that incumbents almost always prevail.
  2. Disruptive Innovation :when the challenge is to commercialize a simpler, more convenient product that sells for less money and appeals to a new or unattractive customer set—the entrants are likely to beat the incumbents. This is the phenomenon that so frequently defeats successful companies. It implies, of course, that the best way for upstarts to attack established competitors is to disrupt them. (Low end disruption and New market disruption)

Confusion happen among the practitioner of whether Sustaining Innovation is Kaizen because it is also about making better products to attractive customers. Additionally, two words of sustaining and innovation are both contradictory in nature in a way that when innovation happen, change happen and it moves the object of innovation to some future state.Thus actually it is inappropriate to give the name “sustain”. Sustain means almost equally to maintain. Hence it means the innovation going nowhere but only maintain and hence going nowhere.

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History wise, the Kaizen term exist already since 1986 which is kaizen/continuous improvement which small incremental improvement. However, it seems that the founder of kaizen concept had predicted that confusion between Innovation and Kaizen will likely to happen.

This big misconception has been cleared before by Masaaki Imai in 1986, a notable quality philosopher and practitioner and the founder of Japanese consulting company namely Kaizen Institute or best known by the west as the father of Continuous Improvement. Misconception of innovation happen when people associate immediately innovation with improvement. The truth is that innovation indeed is improvement but improvement is not just innovation. Improvement consist of Kaizen and Innovation in which until the next innovation, kaizen will improve the system little by little.

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From the graph it is clear that Kaizen perfected Innovation. It means that any types of Innovation whether it is disruptive innovation, cultural innovation, reverse innovation will be make perfect by following through with Kaizen afterwards. Kaizen will target improvement until next innovation.

Hence it is very clear that innovation itself is insufficient to create a winning edge and that innovation coupled with relentless kaizen become the ultimate answer. This is why in my opinion, despite of the effort to rally with other companies toward Innovation from generating, managing, until applying innovation many firms still happen to be in the lower league. Because Innovation without Kaizen is just like “Pound Saving, Penny Foolish”. It seems good that you get to save many Pounds, but other companies take care also every Pennies possible with Kaizen and overtime they who cares for both thrives.

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What else increases productivity : Brain Tweaking!

I could  agree when the crowd mainstream shout for so long that psychology is a degree that apparently not so useful in the job market. Just take a look at yahoo answersocial anxiety forum, until student awards. Most of the graduates indeed found their job have a little or no relation at all to the degree they obtained. Psychology even included in 20 most useless degrees in a famous blog the Daily Beast.

Actor businesswoman express sadness isolated in white

People who don’t intend on becoming Psychologists or working in the field as a mental health professional shouldn’t pursue degree’s in Psychology.

Somehow, I felt that the quote above is right to the point and contain a bitter pain fact that should be accepted by those who hold first degree in psychology. However, I always captivated to watch an expert in psychology shows their understanding and ability to understand human.

When psychology combined with TED Talks, it’s exactly my guilty pleasure. Who wouldn’t like to watch TED with all the inspiring persons talk about how we can actually improve our self, our community, and even not surprisingly our world. This week, I came across a video which lighten up my mind and open my view into another eye opening fact about increasing productivity through the use of Neuropsychology.

Improving your brain means everything in your life start from your body, to your money, your relationships, to the level of innovation.

Daniel Amen, a psychologist gave a TEDx Talk about what impact a healthy brain has on innovation that human produced. He revealed a study about brain using a sophisticated brain scan study that looks at brain blood flow and activity pattern to figure out at how brain is working and what it can bring to human productivity.

His thesis is simple that healthy brain makes us happier, wealthier, wiser, more creative, more innovative whereas unhealthy brain will bring sadder, sicker, poorer, not as smart, rigid and inflexibility to us.

We can accelerate the aging process with our behavior and you can decelerate it. It works the same with innovation. ~ Daniel Amen

What is interesting about his talk is that he presented about some activity that could lead to unproductivity. I was so amazed when I saw the video because not only he mentioned the kind of activities, but also the reason why. It turns out that obesity damage brain function in a way that as the weight goes up, the actual physical size and function of our brain goes down. Additionally, smoking and high blood pressure also very important to monitor. High pressure causing low flow blood to brain and smoking cause upnormal blood flow.

Exellent idea, kid with illustrated bulb above his head

Below, is the quick summary from Daniel Amen talks about what kind of activities we should have to enhance productivity by means of making our brain healthier.

WHAT ENHANCE YOUR BRAIN ?

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These powerful recipe will guide us to a more effective journey toward gaining more productivity. In fact, I started to apply some of the techniques given by his TEDx Talks and in the near future I will let all of you fellow travelers know about my journey on this one.

Deceiving Industry with Quality: How Customers could Give the right signal of Quality?

People in the business are busy defining the definition of Quality for them to be better at producing, delivering and satisfying for the benefits of customers. However, sadly, many customers still deceived by these terms of quality that people or customer of often said that if they want a high quality then there will have to incur high cost. “Good products means high cost”

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As a customers, we see much too often that buying a quality product is about getting information from another people such as our friends, colleagues, or review of great product and then determined which one is quality product according to them and go to store and buy it.

What happen is sometimes people forget that quality products means that this product fulfilled customer’s satisfaction and that customer that is satisfied is actually is  “us” or “we” or in your case is “you”. At the beginning, quality is defined as those products that could best match and fulfilled customer’s needs. With this definition, I therefore sometimes feels awkward when I heard inside a store when a person tries to buy a high quality product merely for the sake that it is deemed good by the product label or a review from a reviewer body such as review in YouTube or any articles or professional reference magazines.

I am not trying to point out that these sources of information that tries to provide customers with the best possible references of current best high quality product is useless. It is indeed, the other way around. These references will be so much helpful for customers to know the average high quality product as perceived by the so called representation of customers such as YouTube, or some other reviewers online in internet or offline. However, the real customer is a single one of us that go into the store and buy a product. Therefore, when a customer go into a store, they have to realize that buying a high quality product means buying a product that best fit with their needs because high quality products as perceived by company that many company tries to capture is to make a product that best fit your needs.

when a customer go into a store, they have to realize that buying a high quality product means buying a product that best fit with their needs because high quality products as perceived by company that many company tries to capture is to make a product that best fit your needs.

Buying a product only because you think that the product have a high quality as labeled by reviewers or manufacturers is deceiving for a long term. It is because in the long run, if customers buying high quality products that actually they don’t really need, they unfortunately send a sign to the manufacturers that the product that they produced is indeed have a high quality as it sold good in the market. Thus, at the end, Industry will have a false impression of a good quality product.

As we can see in the picture above, we as a customer sometimes easy to see that the product is not conform with the level of quality that we should have, but not with the case with detecting and acknowledging that there are also some products that actually we don’t need and do not conform with our needs because they are just over-qualified.

chinese female shopping

Over-qualified products get noticed from the effects after we buy this kind of products. We will likely never use many features that it have because it seems so advance and cool in the advertisement but actually we never actually need it or inappropriate at time of use. Therefore, we will just usually store it in our house because it seems have a value and function that will benefited us at the time of buying, but when it comes to using the product there are simply no place and proper time to use it.

Think about a very nice high tech Hand phone you bought or a very nice dressed that you bought. How many feature in our Hand phone that we don’t actually need and how many nice dressed that we thought it will be nice to buy it and wear it to a huge event in which this event will never yet come.

Buying high quality product is to buy a product that best fit your need.

Because every company in the world will do anything to create product that best fit your need, then why you are buying a product that is under-qualified or over-qualified to fit your need. Sometimes illusion of advertisement will make us buy this over-qualified product and the sense of security of spending money will make us buy all the under qualified product that will not fulfill our needs.But the best to gift signal for companies all around the world to be better at reading customers’ real needs or quality level is to show them by buying only the products that we really need.

Supermarket Stocktaking, Happiness in Working and a Lesson of Variation

I am considered myself as a kind of person who is so interested on listening more than speaking. For me, being able to listen to ideas, a glimpse of someone else’s life experiences or a feeling of someone about something is so inspiring. I can learn from the story and get an idea of things that I had not realize before because I just never thought it would be possible, never experienced it myself, or simply didn’t know that such a thing could exist. By listening more, I can open myself to the presumption world that I previously held  to a new perception of the world as I listen to the story of people around me.

This post is referring to my comment on my dialogue with one of my friends. He has an interesting experience in which I had not any experience on  being employed in the type of industry he was in. It was all begin in a totally normal day. After lunch, we had a normal afternoon chat that suddenly led to a story of his previous employment in Supermarket Industry. Due to my curiosity, I started to ask probing questions that led him to tell his own experience working in a supermarket with a role as an assistant store manager with most activities that deal with audits.

What caught my attention was when he talked about his experience in stock taking procedure and penalty that he did in his time (and I believe still many also have the same principles even until this time). He told me that in his company, stock deviation from the ideal value of difference between beginning of month and end of the month in comparison with actual reality value of difference between beginning of month and end of the month difference will be assigned to store employees. It means that, if beginning of month stock minus sold product in that month ( which this become ideal end of month stock) is not the same as actual counting at the end of month stock, then the difference between ideal and actual counting in the form of amount of money will be paid together by employees from their salary to substitute lost products .

When he told this, I quickly recalled a wise words from Dr.Deming. Then, I found the exact same story that happen in Deming’s book titled “Out of The Crisis” in 1982. Deming has already elaborated what is wrong with this kind of system setup and why management not only in manufacturing industry but in all industry, even government, education, and any systems that has management on top of it has to learn the knowledge of variation.

Stock counting at the end of the month, if deviated from the ideal amount, can cause from many factors. the accuracy of inventory system, security of store from thieves, logistics in store, and still many other factors. It is indeed easy to directly attributing lost of stocks to employees for replacing the money that lost with the assumption that all lost rooted in the negligence of employees to prevent it from lost without looking into details about the root cause. However, by doing this, it is also easy to get trap into a bad system where everyone is dissatisfied, work is stressful, and at the end surviving will be impossible if not very difficult without sacrificing employees.

Actor businesswoman express sadness isolated in white

Imagine a staff that start to work in a company with a good pride. He and the company both have an expectation on both sides. The employee starts with a willingness to contribute to the company maybe even thinking that this company that he will start to work will be even better, fun and fulfilling. It is also the same good expectation that come from the company that hired this employee, because after all resources available in company’s labor pool has been filtered, this man has the best fit with the company to help reaching for the company’s goal. The new employee is ready to grow with the company and contributing the best effort possible. Isn’t that exactly what we feel when we want to start working in a new company? Excited! Happy! Want to prove ourselves! and having better a time? Sadly, this man so shocked to find the fact that even though he begin his job by working as hard as he can with the will of contributing his maximum effort and with their own heart and soul trying to be nice to every customers coming to the shop, he finds himself at the end of the month getting paid with less salary than promised and that they ought to receive it due to stocks lost that they don’t have any ideas at all of  how it could be lost, why they have to be the one who take the risk of something they just don’t have any idea about, and the fact that he cannot improve or doing anything about it.

Drawing from the world of manufacturing, this could be seen as assigning defect of products to the workers that works in assembly line. Whenever there are defects, put the blame on workers with the reason that workers are the one who actually works assembling all parts into a product. This obsolete philosophy have proven to be a downfall of manufacturing industries before Japan could set the pace again and followed by a reparation to systems of managing manufacturing in other countries and companies.

People in management should as Deming urge long time ago and yet still valid, realize that there are two types of variation (natural/normal variation and assignable/special variation) Classifying defects in case of lost product in supermarket into these two kinds of variation classification will give us more insights. If a defect/lost product happen, manager should be able to determine if this will attributable to workers/store employees or to system that managed by management. The action directly blaming workers for a system problem then is not a wise act of management because normal variation and special variation should be handled in different ways. .To learn more about differentiating this, I would suggest reading “Out of The Crisis” or “The New Economics” by Deming.

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As we came to know that those defects or lost of products are caused by system, then improvement to a system could reduce the lost of product. In relation with supermarket system, let’s take one defect example of lost product. Previous assumption is that employees should watch closely everyone on the store so that no product is lost, but employees indeed can be forget or not paying attention to someone stealing because fatigue which so normal. What is not normal is to assign tasks that obviously normal people with normal capability cannot do and give them penalty for it.  In fact, lost product happen also because the environment provided thieves to steal some products despite of the hardworking that employees have done in preventing it. This environment setup is management job. A system should be setup by management to prevent lost from happening by creating a better environment for employees to work and a better system to prevent lost of products. Usual flow is that mistakes that management makes is attributed that should be management responsibilities (system design and improvement) are all assigned to employees.

Join Green Movement in Urban Area

Last post, in my personal article focusing on plastic bag, I have elaborated the importance of the role of Industry in determining the progress of  transformation into green and sustainable living. In addition to the Industry effort, we as a customers in any supply chain, a human that lives in the earth and a parent that will have to pass on the living environment to our future generation, has an obligation to the progress of green and sustainability of living around us.

For those of you that live in Urban area where people bustle everyday, tall buildings occupying most spaces  and transportation seems never stop their activities, the hustles will be more intensive than people that live in suburban or small city area. However, I can convince you that it is possible to still join Green Movement to preserve the good side of the city that we have know and to fix those that have already been destructed by pollution and other matters. Below are several tips for you to get to move and participate in small act to make our city Greener and more comfortable for a living.

1. Electricity and Water Use Awareness

By saving energy and water, we actually will in the end save our money.The US Department of Energy has statistically calculated the hundreds of dollars savings that could be achieved by smartly using energy and water. From Coffee Maker, Refrigerator, Fan, Clock Radio, Cell Phone Charger, Personal Computer until Printer, there are still a lot of possibility that we can cleverly reduce our consumption.

One great example is to turn off the lights if you know that you will leave the room for more than 15 minutes or you can also put a sensor to further save electricity. Another is sharing fridge. Sharing fridge seems have a little impact, but in reality, the cost of electricity from fridge itself is consider as large in comparison to other home appliances. So, instead of buying small fridge for each of rooms in your house or apartment, you can plan to share a fridge.

2. Buy Green Products

Eating organic, free-range, local and fair trade are also a great options that will definitely have a positive impact. However, because those products are rather expensive, an alternative is to to eat less meat, use canvas bag when you can, use recyclable plastic bag and buy from your local to get anything from fishes and meats to vegetables or fruits and still contribute to environment.

Buying green products will also unconsciously lead you to healthier living by avoiding more and more consumption of junk food which have bad effects that will later take away money from your pocket due to obesity, diabetes, depression and nutrient deficiencies.

3. Urban Farming

The previous two tips are all about getting better at managing what we already have. The next tips will be about making small changes that have a big impact. It starts with Urban farming. It is the practice of cultivating, processing, and distributing food in or around a village, town, or city.

Urban Farming is very fun activity to do. If you have a garden in your house, you can use it as your own farm. Even if you have only a roof (flat roof ones), you could turn it into a space for farming. Urban Farming is so easy as you can simply use your window as a medium for farming which Urban Farming Communities called windowfarms.

Urban Farming communities is now everywhere in the world, you can find communities around you with the like minded purpose and the good thing is that all that effort you spend in your farm will be fruitful as you can sell it as an organic product through Urban Farm communities and organizations. The organization also has good resources for education from methods of urban farming until ways to plant a certain plant and dealing with issues like watering and soon.

4. Cycle to Work

Another fun way is Bike to Work scheme. Using bicycle to go to work is a very effective method to achieved so many things. It is not only contributing to a more greener and sustainable environment, but also saving money for gasoline and make you more healthy. For some people, indeed, Cycle to work could also save life.

If you have a road bike, you can go to work riding it and take a shower in your office and you will be fresh and energetic to start your day. Another good alternative that I found very compelling is to use Folding Bike. I love folding bike because it gives commuters so much flexibility on the way. There are many combination of method that can be done using folding bike to get us to workplace in no time.

5. Change our Mindset from “WANT” to “NEED”

Our mindset is a powerful thing. Have you heard about feeling lonely in a crowd ? This is exactly what mindset is able to do. It can make you happy or unhappy when you decide that the circumstances seem to prove that you should have it. The fundamental change in mindset could change the way we behave and how it affects our surrounding.

To change mindset, the key is to know what our currently mindset is toward a particular situation. Oftentimes, in relations with buying or shopping, we as a customer has been automatically set our mindset into “WANT mindset”. The reason is, this is the right mindset that all retailer shops want customers to have so that customers will more likely to buy their products.

So, now we should change our mindset to NEED instead of WANT. Think before buy is a good step to take. Do some researches before buying anything instead of getting tempted on the spot when you see a very nice advertisement. Go online, watch videos, read articles and make sure that you purchase good stuffs that you need. Then, you will be surprise by how much stuffs you really need and how much stuffs you already have that are actually got there and hanging around since you first bought it.

Marketing in Disguise: Transcorp 11th year celebration

Transcorp is an Indonesian Television corporation that runs its business by owning and managing several biggest television stations such as Trans TV, Trans7 and also online news called DETIKCOM. Transcorp recently had a birthday celebration which is pretty awesome. Every viewers could experienced the huge stage, famous artists and magnificent lightning effects and on top of all that, it was a well crafted program that could entertains both live viewers on the site and also at home. I was not currently in my home country but I was able to watched it through a website called Mivo.tv.

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Point that worth shared is that beyond the well presented concept, grand event, fabulous design and the overachievement result, I saw the event as an eye opening inspiration for many of Small and Medium business especially in a profit base organization. In this segment of Business, they tend to celebrate the success year by year with their own staffs, have a big cake, decorating rooms in office or probably have a adventurous outing in to celebrate it. The mainstream of owners in a small business will and in general have a good logic of giving back to their employees and of course to the owner himself a reward of this achievement by spending a certain amount of budget for company birthday celebration.

On the other end of the world, when we go to a typical birthday celebration as a person, we usually invite all the persons that is close to celebrate together. It could be our family, close friends, girlfriend/boyfriend, relatives or any persons that we deemed important in our lives.

What is wrong with this? I assume nothing is wrong, except sometimes when we run our Small Business, we become carried with the ordinary and natural action that we take as a person and forget that we are actually running a business.

Unconventional approach to a “Birthday” for a company is the exact example of Transcorp. This company definitely is not the only company that take this approach, and many other big companies take similar approach to celebrate their birthday. The mind blowing fact is that the event just did the reverse of what is considered regular approach of celebrating a birthday. Instead of only taking all employee to vacation or give treat to them, Transcorp additionally also launched an event.

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I immediately think of why they did all of that? Why they spent so much for a big event when all they should do is celebrated their success for that particular year that they have achieved so hard? By launching this event, they actually throw out their possibility of a bigger celebration because the budget for event can actually be use for their own internal celebration or outing.

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Then I realized instantly that when I saw the event, I feel like become more “attached” to this company as a viewer of this event because of the event that they held is so magnificent and beautiful. Now the reason is obvious, it is because the customers that make their business run. Big business put greater attention to maintaining their customers and this is exactly why they become big in the first place. There is actually no advantages of making a huge event called a celebration of a particular company for public. But the unmeasureable value of future profit is very certain. People perceive better image of the company and the effect is growing loyalty. This event is a “marketing in disguise” which is a very genius approach that could also be use for Small and Medium Business.

Some big companies or small companies usually do not recognize this seemingly covered opportunity by building more image into customers and expanding awareness with the motives of celebrating birthday. For Small and Medium Companies that have more limitation in their budget, a small event is more than enough than nothing at all.

if we can’t measure it, than we can’t manage it. But the most important things in business are those things that cannot actually be measured. –W. Edward Deming

It means one should not stuck only to numbers and quick profit, but also subjective matters that can guarantee our business in the future.

Managing by Heart: What Leaders Should Learn from Toyota

Toyota has come into test by recall of its vehicle all around the world. From the lens of customers, recall means a bad action because it looks like Toyota has so many defects. In fact, not in all recall Toyota found defective parts. But why Toyota do recall that actually give a bad impression to customers?

For those who oversimplify business and looking only into short term action, this bad impression will persist. However, the actual reason of this recall is to better satisfy customer in the long term. I would not talk here about recall issues in specific, instead, the focus on the long term and the focus on the satisfaction of customers, even when the customers still do not know that the action will satisfy them in the long term because it disappoint them in the short term.

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This ideal principal of Toyota is not only mere a tag line to make its company looks professional, but it is a living system that proves it consistency on focusing on satisfying customers in the long term.

This is the reason that Toyota is one of the leader in Automotive Industry. To be a leader, we have to focus on satisfying customers and on the other hand those who do not focus on satisfying customers in the long term will soon enough perish. This great ideal philosophy has been around us for decades.

In the Bible for example those who will be a leader has to be a servant.

Matthew 20:25-26
25Jesus called them together and said, “You know that the rulers of the Gentiles lord it over them, and their high officials exercise authority over them. 26Not so with you. Instead, whoever wants to become great among you must be your servant,

In addition, Scientifically, This term has been coined by experts to be called servant leadership.

Servant leadership is a philosophy and set of practices that, together, enrich the lives of individuals, build better organizations and ultimately create a more just and caring world. A servant-leader focuses primarily on the growth and well-being of people and the communities to which they belong. While traditional leadership generally involves the accumulation and exercise of power by one at the “top of the pyramid,” servant leadership is different. The servant-leader shares power, puts the needs of others first and helps people develop and perform as highly as possible.

Pillar of Toyota which is Respect for People and the principle to contribute to society has make Toyota a serving leader among all Automotive companies. Additionally, this behavior of serving leader not only shown in the big area as a company but also reflected in the response of the CEO Akio Toyoda when storms face Toyota.

The video below shows how servant leadership of Akio Toyoda to many segment of communities.

 

This video declare his intention on being a servant companies to the public. Not enough doing this, he also made 2 additional steps to deliver the message to customers by doing apologize talk show in television and also making a TV commercial which will incur additional cost for Toyota.

 

Surprisingly, what many customers do not know is the truly profound act from Akio Toyoda that proves his quality as a Servant Leader. Instead of getting mad and talking about profit and losing money, he went to America team and greet the assembly workers. He also delivered a really deep gratitude to all his employee to support him in the difficult situation. He knew that he is a servant to a customer. but he also knew that he is a servant of his employees and therefore he is the leader.

The servant leader will says thank you to all who support him, but an ignorant leader will get mad to all his subordinate in order to get profit get into the company back. Ignorant leader will obviously get back the profit on the short term but not in the long term due to his ignorance to all employee that experience additional suffering in the crisis from their leader. But the servant leader will get back slowly but certain. The company not only will getting back on its foot, but all employee will go forward together because the culture of servant leader is embedded and spread inside the company with its CEO as a living guide. The effect is an enormous viral movement inside the company that makes everyone in the company to try hard to be a servant leader and in the end helping in serving customers and bring the company into number 1.