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“Best Run” Companies—and other misleading headlines

“Best Run” Companies—and other misleading headlines

It happens every January. The “LISTS” emerge. The ‘best and worst’ of everything from the year past. The lists are entertaining at best – and can be dangerous at worst.

I say dangerous because many of the lists are myopic and misleading. One list in particular never fails to get my goat: The ‘Best Run’ Companies. When we look deeper into how this list is often established, we find that the criteria are almost always based on financial return. Earnings per share, revenue and share price are popular data points.

Don’t get me wrong. If you’ve worked with me you know I am highly results-oriented. I have a sign in my office that says, “NO MARGIN, NO MISSION!” For certain, financial data is critical to the health of the company. But it tells us nothing about how the company is run, on a day-to-day basis, behind the curtain.

There are too many ways to game the system when financial data is the only perspective. Financial data is only one small sliver that contributes to the whole story of how a company is run. You can probably think of many examples of companies who looked good to Wall Street – but the Whole Health of their organization was in shambles. Their people were burned out, they may have cut corners on quality or integrity, or they left a carbon footprint that could choke the entire community they live in.

So use these lists with extreme caution. They can be a place to start, a launch point to ask more questions. But if you plan to use these lists as case studies for ‘best practices’, or (heaven forbid!) stock investment advice, please be sure you are considering the whole health of an organization before you make any decisions.

What companies would you say are well run? What criteria do you use to give them this distinction?