What is a Fortune 500 Company?
Characteristics of Fortune 500 Company
(1) Vision --Fortunate 500 companies have a clear vision stemming from top management as to what they are about and what they want to be. This vision is clearly communicated to all employees and used on a daily basis for making decisions.
(2) Empowerment --Employees are treated as though they are partners, not slaves, to the business. The organization expects a lot from every employee, but is willing to help employees do their job with minimal barriers. Employees are expected to constantly be learning new skills and growing, and the organization provides training and career development options to facilitate that growth.
(3) Performance --Employee performance is measured and monitored in a way that encourages optimal performance. Goals are set for all major areas for performance, and feedback is routinely provided as to how employees are doing against those goals.
(4) Team Approach --Employees are organized as much as possible into teams to facilitate the best means for solving problems, building morale, and creating synergy for achieving group and organizational goals.
(5) Customer Service --Customers are treated as if they are the most important part of the business, which they are. Every employee and manager seeks to serve the customer or support those employees that are doing so.
(6) Quality --The organization prides itself on producing quality goods and services all the time. The company knows that long-term success depends in large part upon the long-term reputation of the company and so consistently seeks to develop lasting, quality relationships and to build quality products.
(7) Communication --Management knows that communication is the oil that keeps the company operating smoothly. It seeks to communicate frequently to employees at all levels of the organization and to allow optimal opportunity for employees to communicate in any direction within the organization.
(8) Ethics --The company expects all employees to be ethical and to act on a daily basis in a way that is consistent with this belief.
(9) Wellness --The organization is concerned with the wellness of its employees, knowing that having a healthy workforce is a practical business decision as well in terms of employees having more energy and less absenteeism for illness.
(10) Profit --The company is profitable because being so is necessary to survive, but does not treat this objective as its sole purpose for being.
Now that we have laid out the characteristics of a Fortune 500 company, how can an organization become such a company? Achieving this goal comes more from managing the journey than just announcing the destination.
Effective change must be monitored to ensure progress is made.
How to become a Fortune500 Company
There are seven steps that should be taken to start the journey.
1. Articulate values. Top management needs to establish a clear set of values that they want the organization --- and its employees --- to represent. This would include specific descriptions of what each value would look like in practice on a daily basis, as well as a methodology for measuring each practice on an ongoing basis.
2. Identify and describe key organizational practices. Key organizational practices need to be assessed to determine a baseline of current business operations. This information would come from a variety of methods including interviews, historical documents, observation of operational meetings, and so on.
3. Compare values with practices. The extent and nature of alignment (or misalignment) of the actual practices of the organization versus its stated values is then determined. It is helpful in this step to obtain additional information from focus groups, employee and customer surveys, and to conduct an analysis of practices compared with the experience of other companies.
4. Establish priorities for realignment. Issues and priorities regarding alignment of organizational practices with stated values are then itemized. Changes that are deemed to have the greatest impact are scheduled to be made first.
5. Recommend changes and implementation strategy. The required changes are defined and integrated with one another to create a vision of how the company would be run based on today’s information, products and markets. This vision includes a process for continual change as new information or priorities dictate. An implementation strategy and timeline is then developed.
6. Make desired changes. Alignment changes are made with care being taken that they are effectively integrated with existing organizational practices. This requires the combined and managed efforts of many people in the organization over a period of one to three years. Involvement of people is a key way to build commitment. Outside expertise may be helpful in specific areas, such as business planning, management training, performance management, team building, customer responsiveness, compensation and reward systems.
7. Monitor progress. A process for measuring the organization’s on-going performance and progress is developed and installed. An effective monitoring system helps maintain the appropriate degree of involvement by employees at all levels of the organization, and alerts management to the needs for mid-course corrections as they are needed.
Managing the Journey
Making necessary changes in the organization is an important step. But, to sustain the changes, and manage the journey over the long-term, there are four systems that should be in place:
Accountability system. Everybody needs to have a clear understanding of whose responsibility it is to do what. People need to know where the organization is headed and what constitutes exceptional individual or group performance. The primary reason that change does not last in most organizations is that people don’t know what is expected of them.
Information system. So often in organizations, only financial data is gathered and is distributed only to top management. Other key indicators that relate to performance areas also need to be tracked. Information on performance has to be made available to those people who can best use it --- those doing the work.
Feedback system. The number one motivator of people is feedback on results. It is difficult for people to correct and improve their performance if they do not have feedback about how they are doing. In the feedback system, managers add value --- mainly through praise --- to the objective information being tracked throughout the organization.
Recognition system. For change to last, good and superior performance has to be acknowledged. If current performance is below expectations, you have to reprimand or provide training as appropriate. To continue in the long term, good performance has to be treated differently than poor performance.
Cheers
Deepali
From India, Delhi
5Characteristics of Fortune 500 Company
(1) Vision --Fortunate 500 companies have a clear vision stemming from top management as to what they are about and what they want to be. This vision is clearly communicated to all employees and used on a daily basis for making decisions.
(2) Empowerment --Employees are treated as though they are partners, not slaves, to the business. The organization expects a lot from every employee, but is willing to help employees do their job with minimal barriers. Employees are expected to constantly be learning new skills and growing, and the organization provides training and career development options to facilitate that growth.
(3) Performance --Employee performance is measured and monitored in a way that encourages optimal performance. Goals are set for all major areas for performance, and feedback is routinely provided as to how employees are doing against those goals.
(4) Team Approach --Employees are organized as much as possible into teams to facilitate the best means for solving problems, building morale, and creating synergy for achieving group and organizational goals.
(5) Customer Service --Customers are treated as if they are the most important part of the business, which they are. Every employee and manager seeks to serve the customer or support those employees that are doing so.
(6) Quality --The organization prides itself on producing quality goods and services all the time. The company knows that long-term success depends in large part upon the long-term reputation of the company and so consistently seeks to develop lasting, quality relationships and to build quality products.
(7) Communication --Management knows that communication is the oil that keeps the company operating smoothly. It seeks to communicate frequently to employees at all levels of the organization and to allow optimal opportunity for employees to communicate in any direction within the organization.
(8) Ethics --The company expects all employees to be ethical and to act on a daily basis in a way that is consistent with this belief.
(9) Wellness --The organization is concerned with the wellness of its employees, knowing that having a healthy workforce is a practical business decision as well in terms of employees having more energy and less absenteeism for illness.
(10) Profit --The company is profitable because being so is necessary to survive, but does not treat this objective as its sole purpose for being.
Now that we have laid out the characteristics of a Fortune 500 company, how can an organization become such a company? Achieving this goal comes more from managing the journey than just announcing the destination.
Effective change must be monitored to ensure progress is made.
How to become a Fortune500 Company
There are seven steps that should be taken to start the journey.
1. Articulate values. Top management needs to establish a clear set of values that they want the organization --- and its employees --- to represent. This would include specific descriptions of what each value would look like in practice on a daily basis, as well as a methodology for measuring each practice on an ongoing basis.
2. Identify and describe key organizational practices. Key organizational practices need to be assessed to determine a baseline of current business operations. This information would come from a variety of methods including interviews, historical documents, observation of operational meetings, and so on.
3. Compare values with practices. The extent and nature of alignment (or misalignment) of the actual practices of the organization versus its stated values is then determined. It is helpful in this step to obtain additional information from focus groups, employee and customer surveys, and to conduct an analysis of practices compared with the experience of other companies.
4. Establish priorities for realignment. Issues and priorities regarding alignment of organizational practices with stated values are then itemized. Changes that are deemed to have the greatest impact are scheduled to be made first.
5. Recommend changes and implementation strategy. The required changes are defined and integrated with one another to create a vision of how the company would be run based on today’s information, products and markets. This vision includes a process for continual change as new information or priorities dictate. An implementation strategy and timeline is then developed.
6. Make desired changes. Alignment changes are made with care being taken that they are effectively integrated with existing organizational practices. This requires the combined and managed efforts of many people in the organization over a period of one to three years. Involvement of people is a key way to build commitment. Outside expertise may be helpful in specific areas, such as business planning, management training, performance management, team building, customer responsiveness, compensation and reward systems.
7. Monitor progress. A process for measuring the organization’s on-going performance and progress is developed and installed. An effective monitoring system helps maintain the appropriate degree of involvement by employees at all levels of the organization, and alerts management to the needs for mid-course corrections as they are needed.
Managing the Journey
Making necessary changes in the organization is an important step. But, to sustain the changes, and manage the journey over the long-term, there are four systems that should be in place:
Accountability system. Everybody needs to have a clear understanding of whose responsibility it is to do what. People need to know where the organization is headed and what constitutes exceptional individual or group performance. The primary reason that change does not last in most organizations is that people don’t know what is expected of them.
Information system. So often in organizations, only financial data is gathered and is distributed only to top management. Other key indicators that relate to performance areas also need to be tracked. Information on performance has to be made available to those people who can best use it --- those doing the work.
Feedback system. The number one motivator of people is feedback on results. It is difficult for people to correct and improve their performance if they do not have feedback about how they are doing. In the feedback system, managers add value --- mainly through praise --- to the objective information being tracked throughout the organization.
Recognition system. For change to last, good and superior performance has to be acknowledged. If current performance is below expectations, you have to reprimand or provide training as appropriate. To continue in the long term, good performance has to be treated differently than poor performance.
Cheers
Deepali
From India, Delhi
Dear Deepali,
Thanks for the information.
The top 10 of fortune 500 companies, 2006 listing is as follows:
Rank ; Company ; Revenues ($ millions); Profits ($ millions)
1 Exxon Mobil 339,938.0 ; 36,130.0
2 Wal-Mart Stores 315,654.0 ; 11,231.0
3 General Motors 192,604.0 ; -10,600.0
4 Chevron 189,481.0 ; 14,099.0
5 Ford Motor 177,210.0 ; 2,024.0
6 ConocoPhillips 166,683.0 ; 13,529.0
7 General Electric 157,153.0 ; 16,353.0
8 Citigroup 131,045.0 ; 24,589.0
9 American Intl. Group 108,905.0 ; 10,477.0
10 Intl. Business Machines 91,134.0 ; 7,934.0
It is also interesting that there are more women running FORTUNE 500 companies this year than there were last year. Currently, 10 FORTUNE 500 companies are run by women* (up from 9 last year), and a total of 20 FORTUNE 1000 companies have women in the top job (up from 19).
CEO ; Company
Claire Babrowski ; RadioShack
Brenda C. Barnes ; Sara Lee
Dorrit J. Bern ; Shoppes
Mary E. Burton ; Zale
Patricia Gallup ; PC Connection
Susan M. Ivey ; Reynolds American
Andrea Jung ; Avon Products
Kay Krill ; AnnTaylor Stores
Linda A. Lang ; Jack in the Box
Kathleen A. Ligocki ; Tower Automotive
Anne Mulcahy ; Xerox
Janet L. Robinson ; New York Times
Paula G. Rosput ; Safeco
Patricia F. Russo ; Lucent Technologies
Mary F. Sammons ; Rite Aid
Marion O. Sandler ; Golden West Fin
Stephanie A. Streeter; Banta
Margaret C. Whitman ; eBay
Mary Agnes Wilderotter ; Citizens Comm
Dona Davis Young ; Phoenix
Cheers
Prof.Lakshman
From Sri Lanka, Kolonnawa
Thanks for the information.
The top 10 of fortune 500 companies, 2006 listing is as follows:
Rank ; Company ; Revenues ($ millions); Profits ($ millions)
1 Exxon Mobil 339,938.0 ; 36,130.0
2 Wal-Mart Stores 315,654.0 ; 11,231.0
3 General Motors 192,604.0 ; -10,600.0
4 Chevron 189,481.0 ; 14,099.0
5 Ford Motor 177,210.0 ; 2,024.0
6 ConocoPhillips 166,683.0 ; 13,529.0
7 General Electric 157,153.0 ; 16,353.0
8 Citigroup 131,045.0 ; 24,589.0
9 American Intl. Group 108,905.0 ; 10,477.0
10 Intl. Business Machines 91,134.0 ; 7,934.0
It is also interesting that there are more women running FORTUNE 500 companies this year than there were last year. Currently, 10 FORTUNE 500 companies are run by women* (up from 9 last year), and a total of 20 FORTUNE 1000 companies have women in the top job (up from 19).
CEO ; Company
Claire Babrowski ; RadioShack
Brenda C. Barnes ; Sara Lee
Dorrit J. Bern ; Shoppes
Mary E. Burton ; Zale
Patricia Gallup ; PC Connection
Susan M. Ivey ; Reynolds American
Andrea Jung ; Avon Products
Kay Krill ; AnnTaylor Stores
Linda A. Lang ; Jack in the Box
Kathleen A. Ligocki ; Tower Automotive
Anne Mulcahy ; Xerox
Janet L. Robinson ; New York Times
Paula G. Rosput ; Safeco
Patricia F. Russo ; Lucent Technologies
Mary F. Sammons ; Rite Aid
Marion O. Sandler ; Golden West Fin
Stephanie A. Streeter; Banta
Margaret C. Whitman ; eBay
Mary Agnes Wilderotter ; Citizens Comm
Dona Davis Young ; Phoenix
Cheers
Prof.Lakshman
From Sri Lanka, Kolonnawa
Dear All, Is there any quanitative measurement which is there to say whether an company is Fortune 500 company. Prof. has given a list. How its rated? Any clue ? Regards SK
From India
From India
Dear Sk,
For 45 years, Fortune Magazine has been ranking the largest companies in the United States. The result is their annual Fortune 500 list. Sometimes people will refer to the top 100 companies on the list as the "Fortune 100." Essentially, the magazine lists the U.S.-based corporations with the largest revenue in the past year. Fortune calculates revenue using publicly available data, therefore private companies (those whose stock is not traded on a public market) are excluded. U.S. subsidiaries of foreign companies are also excluded.
Trust this clarifies
Cheers
Prof.Lakshman
From Sri Lanka, Kolonnawa
For 45 years, Fortune Magazine has been ranking the largest companies in the United States. The result is their annual Fortune 500 list. Sometimes people will refer to the top 100 companies on the list as the "Fortune 100." Essentially, the magazine lists the U.S.-based corporations with the largest revenue in the past year. Fortune calculates revenue using publicly available data, therefore private companies (those whose stock is not traded on a public market) are excluded. U.S. subsidiaries of foreign companies are also excluded.
Trust this clarifies
Cheers
Prof.Lakshman
From Sri Lanka, Kolonnawa
Prof Lakshman,
Thank you for the Valuable inputs. May I take the liberty to add one more name even though she has not yet officially taken the Post.
Ms. Indira Nooyi: Pepsico
(Proud to be an Indian :) )
Regards
Praveen
From India
Thank you for the Valuable inputs. May I take the liberty to add one more name even though she has not yet officially taken the Post.
Ms. Indira Nooyi: Pepsico
(Proud to be an Indian :) )
Regards
Praveen
From India
Thanks to Deepali and prof Laxman.
And special thanks to Praveen ........Even I was searching for Indira's name in Prof Laxman's list........
Yes we are really proud to have an indian on such a big post.
Regards,
Mona
From India, Mumbai
And special thanks to Praveen ........Even I was searching for Indira's name in Prof Laxman's list........
Yes we are really proud to have an indian on such a big post.
Regards,
Mona
From India, Mumbai
the list of characteristics of fortune 500 companies identifying these common characteristics is indeed appreciable.
how about small and medium size companies which have theses values, characteristics and practices alike the fortune 500 companies but not big. do we not need to applaud them or encourage them with reward and recognition as the future fortune 500 companies or great places to work for. just a thought!
ofcourse achieving scale and size could be a measure of deserving the recognition - but small could be beautiful and need not be ignored while could be identified for their positive characteristics and potentials as runners up.
humble regards,
From India, Ahmadabad
how about small and medium size companies which have theses values, characteristics and practices alike the fortune 500 companies but not big. do we not need to applaud them or encourage them with reward and recognition as the future fortune 500 companies or great places to work for. just a thought!
ofcourse achieving scale and size could be a measure of deserving the recognition - but small could be beautiful and need not be ignored while could be identified for their positive characteristics and potentials as runners up.
humble regards,
From India, Ahmadabad
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