It’s All About Engagement
We’ve all seen it. Questionable decisions, made in a corporate office, are rolled out. No one questions the corporate mandate. Sure, some may grumble or may complain about the stupidity of something, but little is done. No one is listening anyway, especially to the employees who are just told to hit their numbers.
Steven Goldstein was an executive at Sears when he visited a store in Florida. His question Why Are There Snowblowers in Miami?, is now the title of his book and is a wakeup call to leaders. Engaging with employees and customers in the right way will help organizations make better decisions.
Steve has held executive positions with leading global brands including American Express (Chairman & CEO of American Express Bank), Sears (President of Sears Credit), Citigroup and others. He also has advised numerous CEOs on how to improve performance.
How a Snowblower Changed Everything
The story is such a compelling example that I have to ask you to start with it. Tell us about the title of the book and how it impacted your leadership thinking.
Twenty years ago, while I was President of the Sears Credit Card business, I happened to be in Miami in February to make a speech. As I always did, I visited the local store – to have a look around, talk to employees and see what we could do for them to help improve sales. When I walked into the lawn and garden department, my eyes were immediately drawn to four shiny red snowblowers. I found a salesman and asked him, “Why are there snowblowers in Miami?”
On my flight back to Chicago, I started to think about all of the other “snowblower” stories I had come across in my career, and it struck me as a perfect metaphor for what is wrong in business. Since then, my experience in leading, advising and investing in companies convinced me that there had to be a way to attack this.
I tend to question everything. If someone tells me, “That’s the way it’s always been done,” I will challenge that process. Because what I have found is that with many leaders, there is a gravitational bias towards the status quo. And while it’s not likely to get you into trouble, simply maintaining the status quo will keep you from achieving your full potential.
I began codifying the approaches, principles and practices I was using and realized it would be great if I could share this learning with other leaders so that they could improve the performance in their own organizations. So I began writing this book, and I thought this was the only title that made sense.
Most recently, I have been giving speeches about these principles and working with several leadership teams to teach them how to make this part of their daily diet. It is resonating extremely well.
Adopt an Outsider’s Perspective
How do leaders best adopt an outsider’s perspective — especially if they have been at an organization for many years?
For many leaders, this is not easy to do. If you are a consultant or a private equity investor, you look at a business as an enterprise consisting of assets that generate cash flow, which in turn generates attractive returns to shareholders. Through that aperture, you want to identify those areas where changes, improvement and new directions can be made to enhance value. You are consciously looking for those nuggets.
For many leaders, those nuggets are hiding in plain sight. Leaders must first accept that adopting an “outside in” perspective is critical to finding this gold. I’m currently Chairman of a private equity-owned company, and recently the leadership team was in a brainstorming session to explore new opportunities and approaches as well as to consider whether our existing business model needed changes. After discussing many good ideas, someone asked, “Will our PE owners be OK with this? I’m not sure they will.” My answer to him was, “They are looking to us to present them with a plan that makes sense, and if it does, they will say thank you.”
Like most things, leaders must accept the fact that their views are colored, even distorted, by their history with the company – and that this skewed perspective limits the possibilities they are able to see. They have to be willing to take the first step, as with any program that induces change. I tell leaders to take a long walk, forget everything they know about their business, come back into the building as if it were the first time and just start asking questions. While it may sound somewhat silly, it actually creates some discomfort; more importantly, it generates excitement about this exploration possibly leading them in new directions. I myself question everything: Why do we do it that way? What does that mean? What other options have you explored? Do you have the right players in each position? This “fresh eyes” approach is one of my five principles of engagement and is essential for generating any real, positive change.
Most connections don’t happen inside the boardroom. Why do so many leaders fail to connect with those who could fuel the company’s success?
Actually very few connections happen inside the boardroom – even though it is perceived as the ultimate source of power. The CEO knows that his future is in the hands of the board, and this weighs heavily on his decision-making process. But if you look at any large retail business, there can be anywhere from ten to twenty levels between the CEO and the sales clerk. The amazing thing is that in many cases the only person directly interfacing with your customer is a $10-an-hour employee, who may only have part-time status. No matter how great your strategies, plans, programs, or initiatives, they have to “work” at the point of sale transaction.
Sadly, most leaders are out of touch with their own reality. They are not meeting with their employees — to understand their issues, concerns and opportunities. Employees can sense that the leaders are too busy and/or don’t care what they think. Even worse, no one is meeting with their customers to understand what their likes, dislikes and buying experiences are. This is where the gold is. Employees (and customers) are the ones who can tell you what needs to be done, and they will become more highly engaged as they see that you are interested, that you care and you are responding.
There’s a slogan from an old commercial, “Try it, you’ll like it!” This always comes to mind when I think of leaders improving their connecting with employees and customers. It’s so important and bears fruit very quickly.
The Power of FOCUS
Many companies have too many goals and hundreds of metrics and key performance indicators (KPIs). What’s the best way to determine the top three so the organization can rally around what really matters? How do leaders best communicate the most important focus areas?
I’m a great believer in the power of focus because it’s a proven way to drive results. It could be a statement like the one President Kennedy made, that we will put a man on the moon by the end of the decade (even though most of the technologies to accomplish this mission were not in existence). In an apocryphal story, Kennedy asked the janitor at the space center what his job was, and he responded, “I’m helping to put a man on the moon.”
Companies are deluged with information, and prioritizing or choosing the right focus is extremely difficult for leaders — at all levels, but particularly lower down in the organization. Each business is unique and is in a different stage of maturity; a “one size fits all strategy” does not work. To do this well requires a deep understanding of the business – not because you’ve worked there fifteen years but because you actually understand the dynamics that drive that business.
Again, I typically meet with the leadership team and have everyone throw out their ideas as to what the right metrics and KPIs are for the company. We typically get more than 100 responses as everyone begins to engage. Next is for the group to create the criteria from we which will decide how to filter these ideas.
Then the fun starts as everyone starts lobbying for their favorites. When we get to seven, sometimes people say, “Why don’t we just have seven?” –another tug at the gravitational pull towards status quo. However, having engaged and participated in this process, this team is ready to communicate, promote and manage towards the goal, which is three indicators. Eventually, you get to three.
5 Principles of Engagement
1: FRESH EYES: Learning to adopt an outsider’s perspective leads to creative insight and problem solving.
2: CONNECTING: Interacting with employees and customers on a regular basis is the key to success.
3: HOT BUTTONS: Focusing on two or three pertinent metrics in any situation facilitates action.
4: TRANSPARENCY: The more people know, the better they can do their jobs.
5: SPEED: Whatever speed you are going is too slow.
What’s the best way to improve leadership transparency?
This may sound overly simplistic, but it starts with telling the truth. Leaders often find it difficult to present clear messages; they often express things somewhat ambiguously, or sugarcoat the message in order not to offend anyone. These mixed communications do not work.
Leaders need to create an environment where folks can talk about issues objectively without personalizing it. For example, I was recently in a meeting reviewing the progress of a major project with a leadership team. Using the red, yellow, green coding for status level, the leader prefaced his comment about a red item by saying, “I know Charlie is working hard and doing a good job, but…” because he did not want to embarrass or alienate Charlie. I jumped in and said, “Look, you’re all invested in this project, so let’s assume everyone is working hard, is committed, and wants this project to succeed. If it’s red, it’s red – and Charlie is not bad or lazy –just late and needs to get back on track.” You could feel the tension in the room lower substantially.
Leaders also need to be honest with their employees. If Charlie is continually late, his boss needs to have a serious conversation with him, as Charlie may be putting the entire organization at risk.
I love this: “If everything seems under control, you’re just not going fast enough.” Tell us about the importance of speed and how to rev up the organization to a faster pace.
That’s a quote from Mario Andretti. I love it and repeat it constantly. We are living in a 24/7, global online world, and leaders need to understand and embrace this concept. Existing competitors and new entrants have created or are creating well defined battle plans to put you out of business. Do you want to be a victim of your own inaction, like Radio Shack, Kodak and Blockbuster? Or do you want to continually improve and reinvent yourself like Netflix?
Large organizations typically think in time cycles expressed in months, quarters and years, while start-up companies think in terms of days, weeks and months. Leaders need to make performance demands that, while achievable, are very aggressive.
Organizations need to find additional capacity by discontinuing things that distract and consume major amounts of time.
As I talk to leaders around the world, the unanimous winner of wasting time is meetings, which behave like a cancer that metastasizes and continues to grow. I’ve actually developed a meetings model to fundamentally change the nature, structure and process of meetings — allowing leaders to make faster decisions and get more accomplished.
Why Are There Snowblowers in Miami?: Transform Your Business Using The Five Principles of Engagement