FOCUS ON SHAREHOLDER RETURNS IS NOT THE ONLY WAY

Recently as high street names fall the short term focus on profitability has been brought sharply into the fore ground. How do stores like Jessops and HMV survive in the modern world when price is king and overheads are seen as an albatross to retail survival? However how often does cheap last?

Commercial history tells us that the most successful organisations, over the long term, consistently focus on “enabling” people things (leadership, purpose, employee motivation) whose immediate benefits aren’t always clear in the short term. These robust organisations are internally aligned around a clear and cohesive vision and strategy; can execute to a high quality thanks to strong capabilities, management processes, and employee motivation; and renew themselves in an ever more demanding environment more effectively than their rivals do. In short, healthy processes today drive improved performance tomorrow.

The issue in the majority of the larger organisations is the short term requirements placed upon them by their shareholders. Many Chief Executives and Senior Vice Presidents instinctively understand the paradox of performance and health, though few have expressed or acted upon it better than John Mackey, founder and CEO of Whole Foods. “We have not achieved our tremendous increase in shareholder value,” he once observed, “by making shareholder value the only purpose of our business.” No most certainly not and yet the increase in value has been long term it has been as a result of healthy strategic processes and disciplines. Outstanding strategy, effective communication and the evolution of people processes to free up mangers and leaders to focus on the future rather than immerse themselves in the problems of today. Don't forget that people run businesses and people are the interface between a business and its customer base if they feel empowered, understand what they have to do and the route they have to take to get there, then they can create extraordinary value and longevity!

TEAM BUILDING v BUILDING TEAMS

I  always like to start discussions around team building with our clients by drawing their attention to and discussing Patrick Lencioni’s five dysfunctions of a team, namely:

Absence of Trust

Fear of Conflict

Lack of Commitment

Avoidance of Accountability

Inattention to Results

I do this because I think this model provides an excellent basis for building effective teams simply by removing the negative descriptors before the key words. So, for me an effective team achieves the following:

Trust through knowledge and acceptance

Constructive conflict by open communication

Commitment to agreed objectives and goals

Accountability and ownership of outcomes, individually and collectively

Results orientation through focus on desired outcomes

In terms of achieving a truly functional team, as defined above, in which team members are interdependent and supportive of one another; I believe there is little which can be achieved by traditional action learning ‘teambuilding’ events and activities. This is not to say the same have no value, more they tend not to build a team in any sustainable or relatively significant way.

Traditional team building activities ordinarily involve achieving defined tasks, which are not work related, away from the team’s operational environment. This dislocates and disassociates the team from their ordinary working experience and employs them in achieving an outcome which is irrelevant to the team in their operational role. Also, Lencioni’s model is hierarchical insofar as the absence of trust leads to fear of conflict which prevents commitment, and so on. By dislocating, disassociation and irrelevance the foundations of the functional team, that is, trust and constructive conflict are no longer required to achieve commitment to the task in hand. This in turn makes it relatively easy for team members to commit to the (irrelevant) task which can be achieved, more or less, without significant penalty in relation to ownership and accountability. Clearly, skilled delivery and facilitation can enable drawing of parallels and lessons relative to the working environment but the implementation of the same is another matter altogether.

My advice to clients seeking to build an effective team is to do so in their work place and utilising the realities of their environment and day to day work. Doing so smartly can also bring added value in achieving organic development and growth. In advising this I draw attention to the need for leadership and acknowledge the challenges involved in adopting such an approach. There are tools and processes which help in building effective teams in this way but the first requirement is for leadership and in so saying, the following clip by Patrick Lencioni about leadership helps explain why http://www.youtube.com/watch?v=6sqvWEI1CVg&feature=watch-vrec

HOPE IS NOT A STRATEGY- HOW STRATEGY CAN MAKE YOUR FUTURE

In today’s business world if you are a business leader you have two choices. You can shape your destiny or let fate take you to the destination it chooses. All too often we come across businesses that have taken the second option and found they are in a place that they did not want to be.  It’s a tough world out there with a rapidly changing environment with lots of competitors chipping away at your business. You need to ensure your business survives and flourishes through proper planning and preparation. Having some sort of Strategy that includes a vision of where you want to get to. An understanding of what might stop you. An idea of the team you would like to assist you on your way and a means of allocating your scarce resources to the most important aspects of your plan.

There is a time and place for each of these disciplines   but you need to understand the where and when and how and bring all of these disparate activities together into one coherent strategy.

So how do I put together my strategy and where do I start?

Like all good stories you need to start at the beginning by understanding your personal requirements and how these can be met by your business. There is little separation in today's fast moving world between home and office.  This entails asking yourself lots of questions. What is it you want to achieve? (Vision) How will you do this? (Plan) Whose help and guidance do you need? (Talent Management) What resources will you need?  How much will it cost? What’s my time frame to achieve this? (Resource Priorities and Risk Management)

Hone your answers at each stage of the process by continually asking one of the most important but rarely used questions – WHY? Sometimes its best asked five times to get to the real issue or desire!

That’s a lot to take in if you’re also spending most of your time on day-to-day operational business matters. Sometimes it pays to bring someone in from outside your business to look at your strategy with fresh eyes and there are plenty of consultants who can do this. Some may also assist in the implementation of your strategy as you focus on the day to day activities. After all we all work far too much "in rather than on" our business.

But in the words of Rick Page “Hope is not a strategy” Start shaping your future to ensure that you get your business to the place it needs to be to give you the life you want!

CREATING VALUE FOR YOUR CUSTOMERS AND YOUR PEOPLE

Companies often mistake profit for value and assume that the proof of profit within our capitalist society automatically indicates that value has been achieved. However the capitalist system is under siege. Companies are widely perceived to be prospering at the expense of their communities. A big part of the current problem is the stakeholders' and boards adopt a limited approach to value creation and the perception of value by potential customers. Focused on short-term financials, companies overlook the broader influences that will sustain their long-term success. The microscope that has been brought to bear by the economic environment brings with it a far more discretionary customer who is focused on what they get in total for their buck. Clever companies could bring business and society back together if they redefined their purpose as creating "shared value"—generating economic value in a way that also produces value for society by addressing some of its challenges; the old win win rather than zero sum argument.

What is value? Value is an individual perception. It comes from an individual's expectations which are founded in their own experience and beliefs. Value put simply is the positive difference between someone’s' expectation and reality. Just as a lack of value is the negative difference between expectation and reality.  So value comes in all sorts of shapes and sizes and it is here that companies need to get cleverer in their delivery of something. Value will last as long as the item is around it is not just about shiny and new products.

Value needs to be measured through the life of a product. It needs to be measured in all sorts of ways to match the expectations of the audience that is trying to assess it.  Long Term Value is no longer about initial cost but it is also about through life costs and disposal costs, it is also about the environmental impact, local economy impact, societal impact etc etc.

Clever companies are starting to focus their marketing on the other aspects of value that society considers important and those that don't reflect the new principles of non-monetary value will soon find their market dwindling as they look only towards their own profit. Clever companies provide and measure the same value to their employees, after all how good is it to work for a company your proud of!

EMPOWERING UNDERACHIEVERS FOR EFFECT

Every leader has at least one person in their team who isn’t performing. You really want them to do better, but do you sometimes sabotage their progress that by managing them like underachievers? Well perhaps there is another way?

A leader always wants their people to perform at their optimum level. It’s good for every one involved in the team and drives organisational performance. Regardless of the leader’s personal intentions - whether they want to look good as a leader or they want to drive their business forward, all a leader wants is for their people to do their best at work.

As team members start to under perform, start to let the leader down, the leader’s initial impulse is to take back some control. Decrease team members responsibilities, control some of the project, or even micro manage them with a long screw driver just a little in order to make the leader feel more comfortable. This is human nature.  After all a successful outcome is being threatened, so the leader naturally re-assumes control. Good leadership some would say and in certain circumstances that is the right thing to do for the task although it may damage the individual team member.

But stop a moment lets reflect on how this impacts upon the under performer doing the work?

You lead top performers very differently from those under performers and perhaps that may contribute to their lack of success.  Two completely different approaches which achieve different results appear logical on the surface; however, it seems ludicrous when you think you are applying methods that inhibit under performers from learning and developing. Let’s break down the logic:

You do something new - and someone performs really well you give them control and let them get on with it with the belief and freedom that delivers success.

However you have someone that isn't performing well doing the same new thing - and you really want them to do well - so you do something totally different, you take back control pressurising them and hindering their opportunity for learning and development

In other words, we manage high performers like high performers. And we manage underachievers like underachievers - even though we want everyone to become a high performer for the sake of the team and the outcome.

And a big component of this is the leader feeling in control. When we take control away from people, their ability to think critically, to problem solve and to control emotions and behaviours is compromised. As leaders, we tend to give our high performers a lot of control and our underachievers a little. We are imposing our way upon someone who may have a better but different way. Someone who may just need to learn how to do it and the best way of learning is experimentally. Hence our imposition of control might end up driving a self-fulfilling cycle.

In a recent study a group of people were given a problem solving test and their scores were recorded. Each of the participants was then asked to describe a person in their lives that they thought was controlling. For 15 minutes, they were asked to describe the person, their actions and specific situations. After this interview, they were given another (equivalent) problem-solving test and each and every one of them performed about 30% worse.

Interesting that just the thought of someone controlling us decreases our ability to problem-solve by 30%!

But it turns out actual control by the incumbent isn't completely necessary. In many research experiments using computer tasks, just the feeling of control can reignite someone's performance. As with most things, perception is more important than reality. We call this ownership and its all about feeling ownership of an outcome. Effective communication by a leader should leave a team member in no doubt about the expected outcome to be delivered and the boundaries beyond which they have to seek permission to pass in pursuit of that outcome. This creates the impression of control although a good leader will monitor unobtrusively until they have total confidence in that team member.

So as leaders how do we develop our under performers through empowerment through the feeling of more control.

1)    Be more organized in your delegation

To delegate well and give people control, you have to be more organized than when you simply do it yourself. You must clearly communicate expectations (the outcome) and boundaries. Give yourself and your direct reports realistic lead times, which allow them to get their work done, get some feedback and then redo it if necessary. When your direct report gets it wrong too close to the deadline, you have very little choice but to take it back and do it yourself but remember, if you can always, exploit a learning opportunity!

2) Delegate pieces of projects, rather than the whole thing

Remember people do things better if they like doing it.  So you're bound to find things that people are more proficient at. The most effective leader develops their team members using challenge and support - too much of either is a poor recipe for learning. If you do not have total confidence  in someone give them pieces of the project that you are happy for them to control, rather than setting them up to fail by being over ambitious asking them to do too much. Time spent building trust and understanding is never wasted.

3) Create the perception of control

Ownership is important as people always need to feel like they control something. There are always things that we have no control over - such as deadlines. But there are also things that we can make sure people do have control over - that contribute to the way in which the outcome is achieved. Delivery of a small contributing piece of an outcome such as the provision of refreshments or even the colour of the binding for the final report without interference can afford a perception of ownership. These small things can actually make a big difference in the way team members perform whilst enhancing trust and cohesion.

People do their best work when they feel they are trusted; when they have a sense of control. Not when they are operating on fear or over worried about making little mistakes that make them appear stupid. They need to understand what they own and the expectations and boundaries and then be left to get on with it.

These simple things might just help your underachievers become high achievers and valued team members in the future. The value of experiential learning should never be missed!

BUSINESS LEADERS - WHAT STATE IS YOUR CRYSTAL BALL IN?

TURBULENT TIMES

I always say that you have two options at the bottom of a well drown or start climbing. Well many businesses currently sit at the bottom of that well. The events that have transpired over the last four years since the onset of the current recessionary cycle, evidence the turbulent times all organisations face. While uncertainty is troubling, it is also the time of greatest opportunity when business is most turbulent.

Humans are happiest in static times and yet if one looks at when the greatest organisations started, it was during times of upheaval and turbulence. Greats like Ford, Rockefeller, Carnegie and J.P. Morgan emerged out of the shift from an agrarian to an industrial society. Companies like Hewlett-Packard, Apple Computer and Microsoft emerged from the shift to an electronic society. This leap to greatness is made possible by the state of turbulence where the traditional paradigms and norms that govern business are shattered. Companies and whole markets are driven to seek out new solutions to their problems as they strive for competitive advantage brought about by the forces of change.

We are well beyond the realms of management and informed creative thinking and decision-making can greatly enhance leaders’ ability to lead. Positivity is key and rather than mourn the loss of business or bemoan internal changes brought about by recessionary pressures or from intensified market competition, leaders need to exploit the new opportunities that present themselves in the prevailing market conditions. One thing is certain: organizations are not going back to the business models that governed them prior to 2007. They are seeking new ways to enhance productivity and profitability, and therein lies the opportunity for any leader who wishes to seek it out. However, each should acknowledge that in times of turbulence, the ability to anticipate problems, situations and opportunities dramatically increases their chances of success. The Sampson Hall Gordian model allows leaders to make informed decisions about their future and the Sampson Hall strategy model enables them to plan in a world of uncertainty. Both are key to an organisations survival in these modern economic times.

If leaders wish to take advantage of the turbulence in their markets they must apply informed creative thinking skills based on reality and yet forward looking to the future. They must step ‘outside the box’ and think imaginatively and yet not naively. Positivity is key and yet credibility is essential. Rigor needs to be applied from a futuristic perspective. The Sampson Hall tools stimulate a shift in thinking that allows leaders to design and develop new solutions to address their workplace and organisational problems. Not only do the tools help with the current position but they enable organisations to understand where they are and how much further they have to go. They identify potential by pinpointing available but oftentimes hidden opportunities. These tools will help the creative thinking process in an organisation, they will allow leaders to take informed decisions whilst understanding and mapping the possible consequences of their decision s and the future problems that they may come across along their path to success. However these tools will only suit organisations that have genuine ambition and the desire to remain competitive amongst their peers. Organisations that have used them do not look back.

VISION and DIRECTION - LEADERSHIP ORIENTEERING

How can leaders at any level, especially at executive or board level, expect to get the best from their people and business or organisation without communicating clearly their vision and direction to their staff? It is not unknown for Sampson Hall to be commissioned to deliver a leadership development programme for a group of middle and senior leaders to find the very people we are helping are being inadvertently ‘hamstrung’ by a lack of vision and clear direction from their executive. This is particularly frustrating for us as we see individuals developing their leadership capabilities and becoming more able to fulfil their potential yet inadvertently prevented from doing so by the very people who have invested in providing the training.

How does vision work and why is it so important? If a leader has not got a clear picture of exactly what it is they are trying to achieve then how can they expect to know when it has been achieved? If a leader has a clear picture of their desired end state but the people they are depending upon to produce that end state do not know what it looks like then how will they know what it is they are trying to deliver? Would you set off to your work place in a morning without knowing where your work place is and what it looks like? A leader without vision is like an orienteer without a map; they are likely to run round in circles getting nowhere fast whilst their competitors get to where they want to be before them.

Not only must a workforce know and understand what is they are trying and expected to achieve but also how to do so. This is why clear, concise and well articulated direction is important. Woolly direction leads to uncertainty and ineffective action which leads to dysfunction and, ultimately, in failure to achieve the desired outcomes. Undoubtedly, when you set off to your workplace in the morning you know by which route you are going and how you are going to get there. A leader without direction is like an orienteer without a compass; they can only follow their competitors around the course and finish the race in last place.

Having a clear vision is only the start. If a vision is to be realised then it must be effectively communicated in a way which has meaning and can be understood by those who need to know what it is. Good direction need not necessarily be detailed but it must be clear and understood by those requiring direction. Also, there is little point in a leader giving direction which is not resourced; a plan must be deliverable and seen to be so otherwise it is no more than a work of fiction which will fail to yield the desired results. Good leadership is like good orienteering. Make sure you have the right map for the ground you are on, acquire and use the necessary equipment correctly to orienteer your way most efficiently and effectively through the course, quicker than your competitors to win the race.