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by Dr. Donald N. Sweet

Strategy is just one piece of the business puzzle, although an important one for sure.  Strategy, we believe, drives the top line of your organization.  If you’re not happy with the growth of your top line it is usually a strategy issue.

When looking for a strategy consultant several important items to consider are:

1)     What kind of broad business experience does the person have?
2)     Do they come only with a specific industry background?
3)     Do they have an integrated framework to assist you in strategy development?
4)     Where have they been successful in strategy development previously?

While specific industry knowledge can have some benefits, often times what a company really needs are thoughts and questions from outside of their industry.  It’s hard to get a new perspective when everyone “knows” how the industry behaves.   There is no one to thoughtfully question long held beliefs.  People with experience in a number of different industries bring a broader perspective to the planning table.

Strategy has a number of integrated components that have to fit well for the strategy to be effective.  Just because someone has participated in developing any number of strategies in the past doesn’t mean they know all the components and how they interlock.  If you’re not happy with your top line, then you probably don’t want to follow the same process you’ve used in the past either.

Too many of us have been in businesses, even led businesses, which followed the same strategy format year after year even when we weren’t happy with the results.  Often times it was really just an annual budgeting exercise with a slim slice of real strategy bolted on.  That’s what many consultants have experience with, too.

Ask your prospective consultant to show you their integrated framework before retaining them to help you with your strategy.  We find tools that are simple but effective to be the best.  At the end of the day, your strategy is only as effective as its execution.  Complex strategic tools result in complex strategies and complex strategies are less likely to be implemented well.  Early in my career, one of my mentor Presidents told me he would take an average plan well implemented over a superior plan with only average implementation.  Complexity is as costly as incompleteness.

Your business strategy needs to be both comprehensive and straightforward.  As many of you begin thinking about your strategy for 2013, we hope you’ll find these past two posts helpful.  The right outside perspective is invaluable when building your plan for future growth.   Good luck in 2013!

by Dr. Donald N. Sweet

Lots of consultants claim to be able to help you with your strategy, don’t they?  Why do you think that is?  It probably has to do with their belief that they have been involved in enough strategy sessions to be able to help business owners.  Experience is certainly important, as are perspectives from outside of the organization.

Furthermore, marketing consultants will say they want to know about the company’s strategy.  While this is usually to align marketing with overall strategy, they also take a view with a marketing slant on that overall strategy.  The CFO type consultants weigh in too, with good solid thoughts, but from a financial bias.  IT consultants also want to understand the client’s strategy to offer the most appropriate solutions.  Having them help develop strategy, while of some value, also comes with IT partiality.

You know the story, everyone has their view on the business world.  It reminds me of what Maslow once said, something like, “If your tool is a hammer you only see problems as nails.”  Don’t you think that probably goes for most tools?  We tend to see solutions from our dominant perspective.

Now wait a minute, a good marketing or CFO or IT consultant says, I have broader experience than that.  While they most likely do, many specialists still see the world in light of their main “tool”.  Is that really the view that serves the business best?

Finally, many specialized consultants don’t have a cohesive structure to help business owners consider the major components of strategy.  Strategy drives the top line in a business.  If you’re not happy with your top line, your strategy needs to be modified.  It is a holistic business issue and must incorporate thoughtful People, Execution and Cash considerations along with the usual product/service, market, customer, technology, etc. issues.

Ask yourself whether your consultant has all the right tools to help you develop a cohesive and effective strategy.

This is a copy of the article appearing in the Portsmouth Herald 9/10/2012 (see here):

© 2012 Brad Lebo — brad.lebo@vitalgrowthllc.com

The first and second installment of this series on leadership introduced the seven insights of great leaders and discussed the first through third insights at some length: knowing how to quiet doubt and worry; knowing how to care for the interests of self; and knowing how to care for the interests of others.

You may recall that these insights are for leaders who want to lead long-term. They are also for leaders who wish to be at the “philosopher king” end of the leadership range (that has tyrant at one extreme and philosopher king at the other).

The remaining four insights are: knowing how to navigate competing interests; knowing how to benefit from feedback from a partner or team; knowing how to hold self and others accountable; and having the courage to imagine and act on a vision.

There is no simple answer to the question of how to navigate competing interests. There are formulas such as evaluating the pros and cons of different options (the rationale approach) and meditating on or contemplating the options until an answer arises “from the gut” (the intuitive approach). These formulas strive to take a task that is intrinsically hard and make it simpler. They do so at the risk of oversimplifying something that is often complex and colored in shades of gray rather than the extremes of black and white.

The formula recommended here is to weigh competing interests using a combination of the pro/con and intuitive strategies, but only after accounting for the natural biases we all have.

The primary natural bias is toward self-interest. This is selfishness and we all have the potential to think of ourselves first and others a distant second. I hasten to add that some level of selfishness is healthy.

Generally speaking, healthy selfishness does not negatively affect others. The line, if you will, is between selfishness that is in one’s own self-interest and also in the self-interest of others or, at least, neutral toward them; and selfishness that is at the expense of others. It is a line that divides “win-win” and “win-neutral” from “win-lose.”

The second natural bias is toward the self-interest of others. This is often called “selflessness.” It means putting someone else’s interests ahead of our own. It may be thought of as “lose-win.”

Most of us know someone who reflexively takes the losing position whenever interests compete. There are psychological reasons why individuals adopt this bias, but for the purposes of this article, it is simply a bias that must be accounted for when navigating competing interests. In other words, if you are inclined to take the back seat when interests collide, account for this bias.

When these biases are cleared from the mind, the formulas of weighing pros and cons and trusting intuition can be applied in sequence with greater confidence that the resulting decision will balance competing interests as much as possible. So, to navigate competing interests, step 1 is to recognize any bias toward self-interest or toward other-interest; step 2 is to evaluate the pros and cons of any action that is contemplated; and step 3 is to do a “gut check” to pay attention to whatever your (bias-free) intuition tells you.

A couple of other things to watch for when navigating competing interests are: passion and perfectionism. Passion gets in the way of clearing bias. It is extremely hard to clear one’s mind of bias when passion is in play. Just think of the last time passion overruled your judgment when making a decision or guiding a behavior. Guard against passion steering you wrong when navigating competing interests.

Perfectionism gets in the way of learning from your mistakes. The fact is, you will not get every decision right when it comes to weighing different options. If you are a perfectionist, not getting it “right” will be distressing and is likely to trigger defensiveness, which hinders learning from mistakes.

Great leaders know that mistakes will be made when trying to decide between competing interests. They also know these mistakes are opportunities to learn how to better remove biases, weigh pros and cons, and listen to gut feelings. Mistakes are lessons in disguise.

Viewing mistakes as opportunities to learn makes for a great segue to the topic of knowing how to benefit from feedback from a partner or team.

The thinking and attitude that mistakes are opportunities changes everything when it comes to accepting feedback from others. Instead of defensiveness and denial about mistakes and areas needing improvement, feedback should be sought-after and embraced. Sounds good, doesn’t it?

In reality, even great leaders struggle from time to time with owning mistakes and admitting to the need for improvement. But if they are going to be consistently great, they must learn from their mistakes (while also admitting to them) and seek feedback on how to improve.

The price of not learning from mistakes or admitting to shortcomings is too high. There is the cost of making the same mistake twice (or more). There is also the cost of having to blame someone else. We’ve all seen a leader at odds with his/her followers after not accepting blame or critique about shortcomings. Indeed, it’s one of the most common things I see in organizations that struggle with turnover and team dysfunction.

Accepting feedback from partners or team members is a challenge that leaders must meet if they want to elevate themselves to the rank of being excellent leaders.

In the next and final installment, I’ll describe the last two insights (knowing how to hold self and others accountable, and having the courage to imagine and act on a vision) that lead to great leadership.

by Dr. Donald N. Sweet

Whether you’re entering a new market, investing in new technology, or hiring to staff a new department, try to seek out some perspective from people you trust who have walked down that road.  All of us come up with new ideas, enter into new situations willingly, but too few of us seek perspective early.  My wife would tell me that’s a guy thing, we never ask for directions.  She may be right.

Recently I was pulled over in a speed trap and given a ticket.  They had the wrong guy; I had just gotten on the road from an access ramp.  As a result I didn’t pay the fine and elected to have my day in court.  Bringing some simple documentation to show where I had come from, why it couldn’t be me, I relied on just being right.  I never asked for a perspective from someone knowledgeable about how those things usually work.  The judge found me guilty; I have to pay the fine.

Hindsight being so good, I now understand where I went wrong.  Has that ever happened to you in your business?  We’re all so busy we don’t slow down and think about how to improve the odds where it really matters.  The ticket was no big deal, but expanding into a lateral product offering could be, just like setting up a satellite office in New Jersey, or any other number of actions.

So don’t make my mistake, ask for help, ideas and perspective from people in the know before plunging into a new endeavor.  As Verne Harnish, Founder and CEO of the Gazelles, often says, “He who taps into the most minds wins!”  Tap into more minds and enjoy your success.

This is a copy of the article appearing in the Portsmouth Herald 7/30/2012 (see here):

© 2012 Brad Lebo – brad.lebo@vitalgrowthllc.com

The first installment of this series on leadership introduced the seven insights of great leaders and discussed the first insight at some length: knowing how to quiet doubt and worry.

You may recall that these insights are for leaders who want to lead long-term. There are also insights for leaders who wish to be at the “philosopher king” end of the leadership range (that has tyrant at one extreme and philosopher king at the other).

The remaining six insights are: knowing how to care for the interests of self; knowing how to care for the interests of others; knowing how to navigate competing interests; knowing how to benefit from feedback from a partner or team; knowing how to hold self and others accountable; and having the courage to imagine and act on a vision.

Knowing how to care for the interests of self is really two challenges in one. The first and easier challenge is to know what to do. The second is to know how to do what needs to be done, consistently.

In my experience, most people know quite a lot about how to care for their own interests. They know, for example, they need to exercise regularly, to not smoke and to eat more vegetables (to take care of their physical self). Many know they need to avoid situations that cause them stress and to regularly seek the support and comfort of friends and family (to take care of their emotional self). Some, if not many, again, know that they need to find a reason for what they choose to do that is larger than themselves and gives meaning to their life (to take care of their spiritual self). We have countless experts with their products, services and advice to thank for being so well informed about what we need to do to take care of our interests.

The bigger challenge is to act in accord with all the expert advice on a daily basis.

To meet the challenge of behaving in their own interest consistently, the best at it do three things. They simplify, they work to make the behavior a habit, and they find ways to challenge themselves. For example, someone who wants to exercise might choose to ride a bike (and not hike or play tennis or some mix of other activities), commit to ride every other day and take an annual trip to do a 100-mile bike race. Alternatively, someone who wants to reduce stress might choose to attend a meditation class (and not yoga class or art class), take Thursday afternoon off every week and strive to reduce how much blood pressure medication needs to be taken.

There are a couple of other important aspects of caring for one’s own interests. First, those who are really good at it recognize that they must attend to all three areas: their physical self, their emotional self and their spiritual self. Each area of self-care is intertwined with the others. So, work in one area makes the work in the other areas easier. Conversely, neglect in one area makes work in the other areas harder.

Second, certain environments (both physical and psychological) are more supportive than others to the challenge of caring for one’s own interests. One might even say that half the battle is choosing a supportive environment. Just think of the difference between eating at the local health food restaurant and a donut shop. Or, consider the difference in stress between dealing with a customer who is appreciative and one who complains frequently and pays late.

So, to recap, knowing what to do to care for the interests of self is about identifying what to do for the physical, emotional and spiritual sides of self and then setting up a schedule and environment that support following through with what needs to be done.

In a natural segue, leaders who carve out or promote supportive environments for themselves take a major step toward furthering the interests of others (assuming they extend the environment to others). Indeed, when it comes to the insight of knowing how to care for the interests of others, there are really only two elements. The first is to figure out what is in others’ interests. The second is providing an environment that is supportive of those interests.

In other words, knowing how to care for the interests of others comes down to taking two steps. Spending the time and energy to identify the interests and then establishing an environment that is supportive of those interests.

One way to identify how to care for the interests of others is to use your assessment of how to care for your own interests. It is a simple thing, really, as the best interests of people are more similar than dissimilar. A simple thing to do but a step that is often overlooked.

Another way to determine the interests of others is to spend time with them—and ask. If the asking is done within the framework of caring for the interests of another, two things happen. One is that the leader can fine tune how best to care for the other person’s interests. For example, if having on-site daycare allows mothers to work with greater peace of mind, those mothers’ interests are being cared for.

Second, the leader communicates real caring and interest by asking questions. This is especially true if a leader listens well and takes action when it is appropriate.

With a clear idea of what is in the interests of others, one can turn to setting up an environment that supports those interests. Ideally, such an environment allows people to care for their own physical, emotional and spiritual needs and provides some encouragement for their efforts.

Other aspects of a work environment that cares for the interests of others are clear expectations, regular feedback, regular appreciation for good work, and an atmosphere that conveys trust in people’s good intentions and willingness to make honest efforts. In a study, the Gallup organization surveyed thousands of workers and came up with “12 elements of worker engagement.” These 12 elements are great at predicting job satisfaction and employee retention. Most of the elements can be summed up as being: communicated expectations, genuine appreciation and opportunity for growth.

Closer to home, one CEO I know makes it a point to hand out the payroll checks to each of his nearly 100 employees every other week and thank them by name for their work. Another strives to have lunch with a different small group of his employees regularly. He expresses an interest in getting to know them and convey his thanks for their work. A third walks through his plant and makes it a point to greet and interact with everyone there, if only to say, “Hello, how are you, Jane?”

If this sounds like preaching for more “Kumbaya moments,” you’re partially right. The trick is that Kumbaya-type harmony is only part of the equation for success and it’s the easy part. The hard part is setting clear expectations, communicating them regularly and providing frequent feedback about performance. These elements are critical in caring for the interests of others, and one of the most important requirements for effective, enlightened leadership.

In the next installment, I’ll describe the next two insights (knowing how to navigate competing interests, and knowing how to benefit from feedback from a partner or team) that lead to great leadership.

by Dr. Donald N. Sweet

This was the provocative headline of a recent Economist.  The “Leaders” article starts with the example of Hal, the computer in 2001 A Space Odyssey.  Faced with a dilemma, Hal decides to kill the crew.  Morals and the machine.

Immediately the mind moves to question just how we will educate machines, computers, about right and wrong.  We now see the use of computers from driverless cars to drones.  These machines are capable of injuring people.  They will be called upon to make some difficult decisions.  There are undoubtedly many smart people working hard to anticipate the various scenarios.

I realize I’m out of my depth when it comes to these machine conundrums.  However we should extend that discussion to the people in a business organization.  Couldn’t the title just have easily been Morals and the Man?   We have numerous recent examples in our society from Madoff to Murdock that would suggest moral issues there, too.

Merriam-Webster defines morality as “conformity to ideals of right human conduct”.   Wikipedia defines it as “manner, character, proper behavior”.  While a number of my academically minded friends would have issue with the precision of both definitions, it’s clear enough for most of us.

We know what is right and what is wrong.  Do we, however, engage people within our organizations in those conversations?  Should we?  Many of us would probably answer those questions, in order, as no and yes.

Many of us, and our teammates, face moral dilemmas somewhat regularly.  How do we assist each other in dealing with them?  One effective way is to ensure our organizations have a robust set of core values.  The next way is to ensure those core values are alive and discussed regularly.

Without solid core values to lean on, we will be rudderless when the next moral storm hits.  We may not be able to resolve the issue of “Morals and the Machine”.  However, we can provide a solid foundation of core values for our organizations to use when wrestling with the moral issues that arise.

This is a copy of the article appearing in the Portsmouth Herald 6/18/2012 (see here):

© 2012 Brad Lebo – brad.lebo@vitalgrowthllc.com

There are lots of articles and books about leaders and leadership. No wonder: leaders are esteemed by all for their ability to safely guide us to places we want to go, even if we don’t know it until we get there.

Interest in leadership is nothing new. It has been studied since, at least, the days of Plato (google “philosopher king” if you’re curious or accept the definition: an ideal ruler who is trained to be guided by the best interests of self and others).

One reason leadership is an ageless topic of interest is that we want to understand what separates leaders from followers, as well as how leaders emerge and develop into the people we admire. We are curious about these people who influence us and the world we live in.

This is more than idle curiosity. There is an inexhaustible need for leaders and leadership everywhere, and at all levels. There is an opportunity to lead wherever there are more than two people. This means there are plenty of opportunities for leaders to separate themselves from followers and try their hand at leadership.

In trying to add to the literature on leadership, I have taken a slightly different view. First, the focus here is on sustainable leadership. This is the type of leadership that people want to embrace over the long haul—not for a brief stint or in spite of how they feel about the leader. This is not one-and-done or crisis leadership.

Second, I’ve framed the description of leadership by referring to seven insights.

An insight is a deep understanding of something. In this case, it’s an understanding of each of the necessary ingredients for leading others over time and how the ingredients coalesce into a platform for great leadership.

The seven insights are: knowing how to quiet doubt and worry; knowing how to care for the interests of self; knowing how to care for the interests of others; knowing how to navigate competing interests; knowing how to benefit from feedback from a partner or team; knowing how to hold self and others accountable; and having the courage to imagine and act on a vision.

Let me be clear. Leadership (even great leadership in the eyes of some) does not require all of the seven insights mentioned. As Derek Stern, PhD, partner in the Executive Assess Group, has pointed out to me, there are many successful leaders who have only a few of the characteristics outlined here. Indeed, a vision of where to go when leading and some informal (personal charisma) or formal authority (rank or position) are all that is required to lead.

Think of the difference between a malevolent dictator and a philosopher king, however. Both may lead effectively in one sense, but who would you rather follow over the long-term?

Closer to home, think of the difference between a parent who acts like a dictator or one who strives to be caring and benevolent. What type of parent would you choose to grow up with or aspire to be?

In other words, there is a continuum of leadership from tyrant to philosopher king (wise and reasonable) or however else you may want to characterize the endpoints. The question is, where do you want to be on the spectrum?

Assuming you would rather style yourself after a philosopher king, the starting point to becoming a great leader is learning how to quiet doubt and worry.

Everyone has to contend with doubt and worry. Everyone. If you don’t think you do, google “denial.”

Leaders have to be better than most at quieting these demons, because they must face uncertainty head on. Truly, at one level, leadership is chiefly about acting in spite of uncertainty. A leader who does not have an effective strategy for handling doubt and worry will be paralyzed by uncertainty to the point of inaction.

There are two primary strategies for quieting doubt and worry. The first strategy is to be “right” about what steps to take and when to take them. This is the “competence” strategy and we value leaders who seem competent by virtue of their education, experience, or combination of both.

There is comfort in thinking we’re doing the right thing or taking the steps we need to—both for the leader and the followers. This is in spite of the “right” thing always being in the eye of the beholder…and a moving target, besides.

The second strategy for quieting doubt and worry is developing faith. I hasten to add that I’m not using the word faith in a religious sense. It could be in a religious sense, it’s just not limited to the religious meaning of faith. If you have sincere faith that what you’re doing is going to work out for the best, you effectively banish doubt and worry.

In my experience, combining competence and faith is the most powerful antidote to doubt and worry. If you can do a reasonable job of doing the right thing (for example, striving to implement best practices) and you can develop faith that any outcome will be instructive if not desirable, then you have built a strong defense against doubt and worry.

Please note: there are lots of other strategies for quieting doubt and worry. For example, there is the strategy of doing something because it’s approved of by others or because it’s disapproved of by others (“I’m going to do this because you said not to.”) There’s also the strategy of numbing yourself to doubt and worry through chemicals (alcohol and drugs) or obsessive working/playing/eating/exercising (there is little time for doubt and worry when you’re always busy).

As you might guess, these other strategies for quieting doubt and worry are often ineffective and sometimes are destructive. Better to expend effort trying to do something right and having some faith—to attain the first insight.

In the next installment, I’ll address the other insights that contribute to great leadership.

This is a copy of the article appearing in the Portsmouth Herald 5/7/2012 (see here):

© 2012 Brad Lebo – brad.lebo@vitalgrowthllc.com
© 2012 Don Sweet – don.sweet@vitalgrowthllc.com

If we view the marketplace as a battlefield where organizations fight for customers, then an organization’s culture can be its most important weapon. This is because a healthy culture is synonymous with efficiency and effectiveness. It is also because in the hyper-connected world we inhabit, any culture that tolerates shoddy service or an inferior product is bound to be exposed for what it is by the broadcasts (tweets and postings) of its detractors.

More frequently than not, an organization’s culture develops and evolves without much attention. It just happens. This is despite the fact that intentional and healthy cultures, ones that are developed purposefully, are more efficient, resilient and, ultimately, profitable. In other words, intentional cultures are more effective competitive weapons.

Being intentional can be a challenge, particularly for a growing company. The demands of customers, employees, and vendors can undermine or sidestep “the best laid schemes.” As Les McKeown describes it in his book Predictable Success, to be successful all organizations must find their way through the inevitable “whitewater period” of growth (where demands stress people and process alike).

Fortunately, there are organizations that have studied growing companies with the goal of sorting through what does and does not work.  This takes much of the guesswork out of what the best practices are for achieving optimal growth. It also streamlines the effort needed to formulate and maintain the schemes that must withstand the pressure of customers’ and others’ demands.

Gazelles International is one organization that has spent a great deal of time studying and working with growth companies.  The thought leader at Gazelles is Verne Harnish. Much of Mr. Harnish’s wisdom can be found in his book, Mastering the Rockefeller Habits: What You Must Do to Increase the Value of Your Growing Firm.

Mr. Harnish and his team have continued to collect the best business practices of small and medium-sized businesses.  They have continually updated what it means to “Master the Rockefeller Habits.”  Their latest thinking about how to grow a company—while instilling a purposeful, healthy and effective culture—is to master the Four Decisions™.  These are the four basic concepts all businesses must master: Strategy, People, Execution and Cash.

In other words, successful, growing companies deliberately attend to their strategy (where they are going and why they want to go there), their people and how they execute (the right people doing the right things) and their cash supply. Attention to these four decisions goes a long way toward establishing, improving the health of (and, to be provocative, weaponizing) an organization’s culture.

Attending to an organization’s strategy is really about making a number of decisions that address: the core values at work in the organization, what the purpose of the organization is, who the customer is for the organization’s products or services, what the organization’s brand promises are…all of these within the context of the organization’s “Big Hairy Audacious Goal” (BHAG)—the North of its compass.

Decisions about strategy are always made, either covertly or overtly. In successful and healthy growth companies, these strategic decisions are deliberate, purposeful and communicated throughout the organization to help align people.  As one CEO is fond of repeating, communicating strategy puts “the wood behind the arrow.”

Selecting and developing the right people is a favorite and often-visited topic of ours. Done well, the outcome is a functional team of people who are each an excellent fit for the role they are in—roles that serve the organization’s strategy for growth. Key points to address when determining fit are: how the individual’s values match the organization’s values, what is expected of the person, and how performance is measured. Other key points are how frequently performance reviews take place and how to develop or redeploy individuals whose performance does not regularly meet or exceed expectations.

When it comes to the execution decision, the question that a successful organization tries to answer is: how do we hold people accountable? According to Mr. Harnish, successful organizations master three disciplines to drive execution and ultimately, efficiency and effectiveness. The first discipline is identifying and communicating priorities. Less is more here, with sharp focus on three to five priorities being far superior to scattered focus on many. The second is developing metrics for assessing progress and providing clarity about the future. The third is establishing a rhythm for getting feedback about progress and noting challenges—a rhythm achieved through regular meetings. These disciplines serve to help hold people accountable for their activities, address challenges as they emerge, and establish a culture that PERFORMS.

Last but not least, the cash decision can often mean the difference between thriving and struggling during periods of growth. In a striking metaphor, cash is the oxygen for a growing business. We all know what happens when the oxygen supply is low or cut off.

The decision about cash has two sides: how to collect it and how to spend it. The Gazelles utilize the Cash Conversion Cycle as a tool for improving a company’s cash position. By analyzing where any one of the common cycles (the Sales Cycle, the Make/Buy Cycle, the Fulfillment Cycle or the Collections Cycle) for turning activity into cash can be shortened or re-engineered, opportunities to “find” cash literally turn up.

In a different analysis, spending is seen in the context of the additional sales required to justify an expense or outlay of cash. This analysis correctly demonstrates that any dollar spent may require four to five dollars of additional revenue before it is “earned.”

We believe that as companies become purposeful in creating a culture that gives them a competitive weapon, they will see greater success in the marketplace—a marketplace that is, potentially, now worldwide.

This is a copy of the article appearing in the Portsmouth Herald 4/2/2012 (see here):

I’ve come to rely on “top-five” lists for just about everything. Perhaps too much. On the other hand, the top five of anything doesn’t completely overwhelm my ability to keep all of them in mind. Like with juggling, five balls in the air is a lot easier to manage than 10.

So, here are the top five people challenges to master if you want to be successful as a leader or manager in business:

 

Challenge one

Understanding yourself well enough to know your values. Values influence every decision you make and the resulting actions. What you believe is important or valuable will determine how you interact with peers, employees and customers, as well as determine how you react to lapses in effort, integrity and judgment.

Being able to clearly define and communicate your values will guide and influence your own behavior and the behavior of others in the organization. Hiring the right people is impossible without clarity about values. Deciding who you reward or punish is nearly impossible without knowing your values.

If you are confused about your values, you will suffer the same fate as anyone who tries to build a house on sand. Everything shifts when pushed and nobody can be sure of what’s happening next.

 

Challenge two

Communicating clearly. There are many ideas and instructions that a business leader needs to communicate on any given day. For the most part, business leaders and managers have a track record of success in communicating clearly. There are several typical stumbling blocks, however.

The first stumbling block is inconsistency. This is when communication happens sometimes but not always, for no reason other than the communication priority got bumped down a notch. The solution to this stumbling block is relatively easy: Meet frequently with peers and give top priority to the meetings. There is nothing like a regularly scheduled meeting to keep communication channels wide open.

The second stumbling block is fear. I’m referring to fear of saying something that causes someone else to take offense and yell, storm out of a meeting, sulk or worse. Fear is what keeps most of us from confronting and holding others truly accountable for behavior that we are confident is a problem.

Clarity in communication is often the first casualty of this kind of fear, closely followed by lost time and energy spent crafting communication that does not cause offense. The solution to this stumbling block is relatively hard, and it’s beyond the scope of this article. Interested readers should refer to “Crucial Conversations” by Patterson, Grenny, McMillan and Switzler, or “Fierce Conversations” by Susan Scott.

The third stumbling block is selfishness. Let’s face it, everyone listens a little better and sometimes a lot better if their own interests are attended to. Think of the contrast between hearing, “If we reach our goal this year, I’ll be able to get that boat I’ve always wanted,” and “If we reach our goal this year, every one of you who contributes to our success will get a bonus.”

The solution to this stumbling block is to communicate in a way that accounts for the interests of your audience. People are motivated by a broad range of interests. For some it will be money. For others it will be the opportunity to help others. Know your audience’s motivating interests, and get everyone’s attention by appealing to them. Do it with integrity, finding the way that is genuine and win-win rather than manipulative and win-lose.

 

Challenge three

Assessing people for their talent, motivation and values. This includes current employees and those who will be hired. Assessing people in an organization is a task that benefits from having a process. A complete process will include features such as measuring performance against expectations, measuring fit with company values, and providing feedback to redirect and develop individuals.

The dark side of this process is that some people will need to be redeployed or let go, freeing up their future.

Done well, getting the right people in the right positions — through assessment, redirection, development and hiring — goes a long way toward taking care of other people challenges such as employee retention and alignment behind company priorities.

 

Challenge four

Confronting problem behavior and holding others truly accountable. This challenge is mentioned above, where it’s a kind of sub-challenge. In my opinion it still deserves a headline of its own because of its importance.

Most leaders and managers struggle to effectively confront problem behavior. It is a skill that, if learned and practiced, can make a profound difference in the performance of any organization.

 

Challenge five

Leveraging a team of people. With few exceptions, a team of individuals working well together typically outperforms even the most talented individual. Teams have the advantage of multiple minds and broader experience.

But, we all know dysfunctional teams that cannot outperform individuals working alone. Such teams do not leverage the expertise and perspective inherent in a team.

Learning how to grow and nurture a functional team to leverage its potential is one of the most important challenges any business leader can undertake. This includes overcoming the potential dysfunctions of a team (as identified by Patrick Lencioni in “The Five Dysfunctions of a Team,”) as well as learning how to assimilate new team members.

The good news is that it’s not that hard to do the things Lencioni and others like him suggest. And, given the state of most teams, any improvement can bring dramatically positive results.

The bad news is that like all the other challenges mentioned, it takes conscious effort and the discipline to keep the effort going. As one CEO recently admitted, “I’ve got to get better at managing people. It’s the only way my company can grow.”

Hears hoping you now have a better idea of what you can get better at.

by Dr. Donald N. Sweet

Human Capital investment is stressed in an HBR article this March by Thomas Kochan.  As you know, human capital is “multinational speak” for employees, fellow workers, teammates and friends.  Therein lies one of our smaller privately held companies’ advantages: we see human capital as people.  People with families, likes, dislikes, strengths and opportunities for growth.  Just like us.

With the right management systems in place, privately held companies can be much more personal in selecting and developing their people.  The right management system is key.  To be clear, we’re not talking about an information system, but a management system.

This is a system the owner and/or CEO puts in place and works to improve broader outcomes.  It’s needs to be a management system that helps identify core values, instilling them in the organizational DNA.  It’s a system that helps to hire, promote and, when necessary, release people according to those fundamental values.

Examples of core values include: Customers First, Do the Right Thing, Can Do Attitude, Fanatical Support, Continuous Improvement, The Glass Half Full, etc.  You get the point.  Core values are what an organization feels are truly important, above all else.  As individuals we all have our own core values.  A good match between employees and the organizational values is essential.

To effectively attract, nurture and retain the right people, organizations must articulate their values.  They must purposely reinforce those values continuously.  This is the essence of developing a meaningful and solid organizational culture.

For privately held businesses any management worth its salt should put heavy emphasis on people.  The Gazelles management system points to the four major decisions any private company needs to address.  They are people, strategy, execution and cash.  While many maintain all four are important, at the end of the day it is people that make it all happen.   People, not human capital.