Hertz So Good

If you want to rent a car, you can be as proudly closed-minded as you like. Maybe you always go with Avis. Or perhaps you’re a Hertz devotee.

But if you want to help run a car rental company, you’ll need more humility. In a recent interview with Rik Kirkland of McKinsey Publishing, Mark Frissora, the CEO of Hertz, said that most executives are too prideful.

“Pride gets in the way of what we call TOM—Total Open Mind—which is our shorthand for an entrepreneurial, innovation orientation,” Frissora said. “I try to surround myself with a team that embraces these same principles, and then I try to drive it deeper and deeper into the organization using our stated values in our management objectives.”

And how does Frissora drive it into the organization? “We try to recruit people with that TOM mentality,” Frissora explained. “We celebrate people who truly have a TOM attitude; we hold them up as examples. By contrast, with people who don’t walk the talk or just don’t have the values, you need to make an example of them as well. You have to make sure that when they leave the company everyone knows why they’ve left.”

Peter Drucker surely would have been supportive of Frissora’s efforts to keep minds open and arrogance in check—but he may have been even more supportive of Frissora’s emphasis on using hiring, firing, praise and review as a tool for reinforcing this set of values.

On keeping thinking flexible, Drucker’s take was simple. As he wrote in The Effective Executive, “Unless one has considered alternatives, one has a closed mind.” To some extent, Drucker felt intellectual arrogance can be remedied with “feedback analysis,” the practice of comparing results to expectations. But, as we’ve noted in the past, Drucker felt that far too many people consider “brightness” to be a substitute for genuine knowledge.

That’s why celebrating some employees and—when absolutely necessary—ousting others is such an effective way to ensure that the stated principles of an organization are the ones by which its employees live.

Perhaps more than any other area, Drucker wrote in The Frontiers of Management, it’s people decisions that “reveal how competent management is, what its values are and whether it takes its job seriously.”

Does your organization make people decisions in accordance with its stated values?