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8:00pm EDT April 25, 2007
James Chu knows ViewSonic Corp.’s place on the computer hardware battlefield.

While giant competitors such as Dell and Panasonic are like armored tanks, bringing potent amounts of resource and financial firepower, ViewSonic is more like a Humvee, smaller and with far less ammunition. On the surface, it seems like ViewSonic could be obliterated by its gargantuan competitors. But Chu, chairman, CEO and founder of the monitor and visual display manufacturer, says smaller can be better for one reason above all others: maneuverability.

Chu says companies maintain their maneuverability when they are able to react quickly to changing market conditions. While

ViewSonic might not have the resources of some of the industry’s biggest names, he says it can offer customers more individual attention and employees an environment where they can take a very real sense of ownership in the company.

Chu says that if you can’t stand eye-to-eye with the big boys in your industry, the best thing you can do is learn how to move faster than them by getting every employee involved.

“When ViewSonic was starting from the ground up, one of our main competitors was Panasonic,” he says. “There were obviously pros and cons to that. The con side was they were really big, and we were really small. But the pro side is that we had 100 employees and just one key product manager, so our employees felt like they had a real sense of ownership in the company.”

Chu says he wants his employees to feel like partners in the business and to have a strong entrepreneurial spirit. And the only way to accomplish that, he says, is through focusing on goals, enabling employees to reach those goals and communicating your company values consistently.

Enabled, motivated employees make maneuverability happen, but the culture starts with the CEO.

Setting goals
Chu says motivation starts with goals, and goals have to be managed with a system of accountability. And that starts at the top of the $1.6 billion company.

At ViewSonic, it begins with Chu’s annual Management-By-Objective plan, or MBO.

MBOs, which are a list of personal goals set based on where the company is headed, are prepared for everyone at ViewSonic. In most instances, they are set by managers for those working under them. However, Chu, in the top spot, writes his own MBO, then submits it to his management team for review.

“I communicate it to each of my managers and give them a chance to give me comments,” he says. “I want to make sure everyone knows my direction on the most important things.”

Chu lists his top three to five goals for the upcoming year, then gives his senior managers opportunities to revise his MBO based on what they think is best for the company. Once Chu’s MBO is set for a given year, he prepares MBOs for his senior management team, who then prepare MBOs for those under them.

Chu says the MBOs, which he mandated several years ago, have become an integral communication tool at ViewSonic. Setting goals and getting feedback not only allows people to hold each other accountable, it also makes employees take a good, long look at their own goals and objectives and begin to think about the how they, individually, can make the company better.

“This can be a very good communication tool,” Chu says. “The reason is, if we just talk to employees with no plan, there is no consequence with regard to goals. People might listen or they might not listen, or they might not take what we are saying seriously. But if I communicate what my job should be and what my goals are to them, it results in a type of feedback.

“When the MBOs go out, it sets a tone for the overall direction of the company. So it’s a way of communicating with them.” He says starting accountability at the top level will create a cascading effect throughout your organization. However, goal-setting has to be a synchronized process or you’ll just spin your wheels, and no momentum will be achieved.

“When my goals go to my direct reports, they should have a more detailed goal- setting and synchronize my goal expectations with theirs, which I expect of them,” he says. “So either I can hold them more accountable, or my MBO is helping to push them.”

An entrepreneurial spirit
Chu says there are natural entrepreneurs. But you’re not going to be able to build and sustain a company by employing only one type of person.

Building a culture that values entrepreneurship and encourages innovation starts with a CEO’s ability to take down bureaucratic walls. Chu says you can find gifted entrepreneurs in a job interview. But you also need to find ways to tap the creative side of all your employees.

“It’s not all one way or the other,” he says. “You might have somebody who is 100 percent an entrepreneur, or you might find someone who is close to zero percent. A big part of it is the culture.

“If you come into a company and are told, ‘Don’t talk too much, don’t try something new or you might lose your job,’ a place where people don’t appreciate any kind of change, or they punish change or punish a mistake, then people will hold in all their potential.”

Chu says he consistently communicates in person, through newsletters and via e-mail that he wants ViewSonic’s employees to be willing to take a calculated risk without fear of admonishment if something goes awry.

If the innovation process produces a mistake or a goal isn’t met, Chu says it is important to treat it as an opportunity to learn how to do things better. Mistakes will be made, and people will fall short of their goals at times. However, the best leaders can take a negative and turn it into a positive.

The best leaders also make communication and the learning process a team effort.

“The key to doing it is that you cannot rely just on yourself,” he says. “During my daily activities, I come up with a lot of strange ideas. Sometimes the idea is very good, sometimes it’s not so good. That’s why I brainstorm with the people who report directly to me. I ask them, ‘How do you like this idea?’ and I encourage people to tell me the truth.

“I tell them I don’t want them to just say, ‘Yes.’ I demonstrate that an honest opinion will not get punished.” Chu encourages his employees to chase an opportunity and advocate for an idea if it makes sense for the company.

“I always encourage people that if a certain issue is happening, why not try it?” he says. “If we try it and the result is not the ideal result we want, we can tolerate it.” He says a willingness to stick your neck out and stick by an employee who makes a mistake is a risk, but the alternative is poor performance and stagnation, which can be far more damaging in the long run.

“We have a place in our employee partner meetings where we ask people who have joined ViewSonic within the last three years to raise their hands if they’ve never made a mistake,” he says. “Fortunately, no one has raised their hand. Otherwise, I would have had to fire that person right away.

“If you join ViewSonic and you aren’t making some mistakes, you aren’t doing anything. Obviously, I don’t encourage mistakes, but I want to make sure people are willing to take that risk.”

Managers and customers
If a company is going to stay maneuverable and a step ahead of the competition, not only do the leaders need to communicate with employees, they also need to communicate with customers.

As with the process of setting and reviewing goals for employees, Chu says it is important to listen and brainstorm, and he starts by leading by example.

“For me, I go to a certain country, I meet with a customer and I demonstrate how to interact myself,” he says. “When I talk to a customer on a certain issue, I can agree or not agree to that issue. Then right after the meeting, I immediately talk to my management, then give them a chance to analyze what I just said, why I’m recommending one thing and not another.”

Chu says he builds an argument for why a decision should be made or why a customer issue should be addressed in a certain way, then opens up the floor to challenges and feedback from his managers.

“I say, ‘Here is something that has potential, and here is something with no potential,’” he says. “I let them analyze why I think it’s that way. So I show them all the major areas of the issue and what my response would be and the background for my decision.”

Chu says he and his managers walk each other through different scenarios in a give-and-take, eventually coming to a consensus.

He says it’s important when considering how to address a customer situation to bring your managers into a forum where ideas can cross-pollinate. Not only can it lead to better end solutions, it can also give your managers a more wide-angle view of what is going on in the company. Chu says that too often, managers get wrapped up with what is happening in their corner of the company and can fall out of touch with other departments.

While some managers have a talent for strategy and dissecting wide-angle problems, many need to be exposed to other perspectives to develop those skills

“Some managers already have that capability,” Chu says. “But I try to help a manager who has a very operational focus but might have some shortfall when it comes to a strategic area.”

Managers in almost every company have some advanced degree of experience. However, when it comes to finding managers who can relate to your customers, Chu says age shouldn’t be a deciding factor in the process. In certain situations, he says a younger person might be a better fit than someone with more tenure.

As ViewSonic has developed a presence in China, Chu has sought out 20-somethings to be his managerial eyes and ears in the Chinese market. The reason? They aren’t much older than their Chinese customers.

“We empower our managers to be different,” he says. “In the Asian market, someone my age would probably not be the best person to come out with a great idea. In the Chinese market, our customers have an age of roughly 25. So I might be a little too old.

“So I want to use a 20-something marketing director to come up with ideas that match the consumer thinking. If you can allow people to come out with wide-angle thinking, that is exactly what you need.”

HOW TO REACH: ViewSonic Corp., www.viewsonic.com