How to Create a Winning Business Culture

This is a guest post by Sandra Mills. Sandra specializes in covering management topics that are relevant in business and healthcare. She has managed both large and small projects on a number of occasions. You can follow her on Twitter or Google+.

When you’re trying to grow a successful business, attitude is often more important than specific skills and experience.  Someone who is eager to learn can easily be trained to meet your business’s needs, but someone who will only do the minimum to collect a paycheck will never help your business grow. Here are 6 ways to build a winning culture that will drive success.

 

1. Set clear goals

Employees who are eager to please can’t improve if they don’t know how you’d like them to improve. Broad statements such as, “Get better,” or, “Increase profits,” don’t provide a clear direction for them to follow.  A specific goal such as, “increase sales by 5%,” gives your employees a visible target to shoot for.  Once that goal is set, they’re more likely to know exactly what needs to be done to reach it.  Even if they don’t, they’ll at least know where to start to get there.

 

2. Make sure goals are reasonable

The goals you set can’t be too high or too low.  If they’re too low, they’ll be easily attainable and will create a culture of complacency instead of one of growth.  If they’re too high, employees might initially be motivated but then quickly realize they may never get there.  When that happens, morale will drop, productivity may return to or drop below previous levels, and future goals will likely be ignored.  Encourage employees to write down goals to stay focused. SMART goal planning (Specific, Measurable, Attainable, Relevant & Timely) can keep goals challenging but reasonable.  Encouraging goals to be written down will keep them measurable and in focus as well.

 

3. Don’t lose sight of the big picture

The best employees still need a strong leader in order to function well within a company. When you’re setting your goals, always think about where you want your company to be in five or ten years.  For example, sacrificing quality may increase profit margins now but may also lead to customers who leave and never want to come back.  Try to make all decisions from the top down.  Come up with a true vision for your company, the main ways to achieve it, and then set specific steps employees can take to get there.

 

4. Promote responsibility

Leading The Internal Talent Wars

The War for Talent

Every day there is a war for talent.  When the economy is roaring, the war gets a lot of attention.  Human Resource departments will circulate reports about the hot market.  Reporters jump into the fray with articles warning executives about the market.  Managers quickly realize that the market is hot, not only because of the articles, but also because recruiters start calling more often.

“A great person attracts great people and knows how to hold them together.” Johann Wolfgan von Goethe

 

No company wants to see the best people leave for other opportunities no matter what the economy is like.

Winning the talent war is a complex goal combining leadership, culture, opportunity and other intangibles.

The war for talent happens every day, in every economy, and inside of every organization.  It doesn’t just happen when the economy is expanding, nor in the hot sectors like technology.  It rages on everywhere, in every organization, continuously.

Instead of looking at companies battling for talent, look at it from a different perspective.  Consider the talent wars raging INSIDE the organization.

Step back from it all, and be on the alert inside of your company:

 

Watch the leaders who attract talent.

 

Yes, leaders who attract outside candidates are worthwhile to watch.  More interesting is to see if a leader attracts talent from within the company.  That means that the manager has created a unique environment, a culture that is worth watching.

 

Watch the leaders who send the talent.

 

Some managers are especially good at sending leaders.  This means the person or group may be especially good at developing next generation leaders.  As a result, the manager ends up with raving fans throughout the organization.  Study this person’s methods and replicate the success.  Leadership is not about direct control but about influence.  This manager’s influence is likely growing faster than others.

Treating Employees Like Associates

This is a guest post by J.D. “Dave” Power III,
 Founder of J.D. Power and Associates. Dave is the subject of a new book  POWER: How J.D. Power III Became the Auto Industry’s Adviser, Confessor, and Eyewitness to History.

Empower Others

In 1982, Tom Peters and Bob Waterman profiled a number of successful companies in their book In Search of Excellence. One section profiled two companies that had done well by valuing employees: Hewlett Packard, founded in 1939, and Walmart, founded in 1962.

My company, J.D. Power and Associates, was more than a dozen years old by the time the book came out, but I remember thinking how similar my approach to managing people was to that of Sam Walton, Bill Hewlett, and Dave Packard. Like Walton, I called my employees “associates” — something I was so committed to that I included them in the company name alongside my own.  And like Hewlett and Packard, I saw the empowerment of individuals as the best way for the whole organization to achieve success.

 

The empowerment of individuals is the best way for the organization to achieve success. –JD Power

 

Peters and Waterman tracked down the sources of HP and Walmart’s management philosophies: Sam Walton had learned about working with people at J.C. Penney and modeled many of his company’s core values on that culture. For Hewlett and Packard, it was lessons learned by working with government offices and for other electronics companies that taught them what not to do.

Treat Employees Like Associates

For me, the foundation of my philosophy for how to treat people — central to my management style — came from observations of what to do and not to do, and those observations started early.

I have always been a student of why people behave the way they do. This goes back to my family, my dad and his explanations to me, and to school. I think I learned a lot in grade school and college about why people do what they do and to have a respect for what they’re doing.

My father, a high school English teacher, was always giving me advice that proved invaluable in running a company. The path he took in his life was the furthest thing from business, but he had a keen sense of the way the world worked and very intelligent insights about people. While I was still in school he told me, “When you’re in charge of people, don’t ask them to do anything you wouldn’t do yourself.”

My first opportunity to put this advice to use was in the Coast Guard.  As an officer stationed on an icebreaker, I was in a position to manage crewmembers from every state in the union and of different races and economic backgrounds.  Many of these men, working as enginemen or boatswains or in the officer mess deck, were just out of high school or were crusty career enlisted men with little patience for young officers.  I made it a point to treat them all with respect and, above all, to talk with and listen to them.  I felt that some other officers, especially the ring-knockers who had come out of the academy, relied far too much on the number of stripes they had to bolster their authority — and I also saw the pitfalls of doing so.  The officers who did not listen to the crew often found it difficult to achieve their goals.  And examples of this behavior went all the way to the top, to the captain in place when I began my first deployment.

This captain created conditions for the crew to misbehave and then came down hard on these young men when they took advantage of the opportunity.  But his gravest mistake, in my view, was an unwillingness to listen to the thoughts of the people who were subordinate to him.

The Outs and Ins of Employee Loyalty

What’s In and What’s Out?

The era of employees signing up to work at a single company for their entire adult lives has long been over.  The importance of differentiating and branding yourself has never been more important.  The best employees have options. They are always on a recruiter’s radar. They often have a resume ready. If your best hope of retaining them is a counteroffer, then you have already lost the war. Consider these ideas if you want to increase your employee retention.

OUT

Helping employees only with their jobs and specific skills to improve productivity.

IN

Helping employees with their lives, which recognizes them as individuals who have needs outside of work.

OUT

Keeping employees at arm’s length and in a strict business relationship. Getting too close clouds your judgment.

IN

Taking the time to know them. Ignore the old advice and become friends. Employees are more likely to be loyal to someone considered a friend.

OUT

Telling employees that promotions are rare, that Jane is never going to retire and to “forget it,” that they will be blocked from transferring elsewhere.

IN

Brainstorming various ways to boost earnings, potential and career options to move within a company.

OUT

Employees nodding their heads like parrots at everything the boss says.

IN

Constructive disagreement, polite dissent, and compromise.

Employee Loyalty

OUT

The rulebook. Everything has a strict procedure and no room for individual deviations or decisions.

Out Execute the Competition

Irv Rothman is the president and chief executive officer of HP Financial Services, a wholly owned subsidiary of Hewlett-Packard Company. Prior to joining HP, Rothman was president and chief executive officer of Compaq Financial Services Corporation where he led it from its founding to growth of over $3.7 billion in total assets.

Irv is the author of Out-Executing the Competition.  What I really admire is that Irv is donating all of the royalties he earns on the sale of the book to Room to Read, an organization dedicated to children’s literacy.

 

The best way to out-execute the other guy is to know your customer’s business as well as you know your own. -Irv Rothman

 

Attracting the Right Talent

Much of success in business is about finding and cultivating the right talent.  How did you attract and retain the talent needed to accomplish your goals?

Attracting and retaining the right people starts with a leadership commitment to first develop high performers in-house.  And this has to be more than an annual “talent management” exercise.  It’s an activity that leadership must consistently demonstrate is important by developing people and promoting from within.  This sends key messages to an organization:

1)   Leadership can be trusted to do as they say they will.

2)   Career opportunities exist…. No need to look elsewhere.

3)   Leadership recognizes and acknowledges that outside hires are a 50/50 proposition.

In short, provide an atmosphere where people can learn and achieve advancement based on merit.  Not only will the good people stick around, their hearts will be in it.

 

Developing a Culture of Execution

 

Out-Executing the Competition

Your book title is all about execution.  How do you develop a culture of execution?

A culture of execution starts with devotion to the customer.  Since it is theoretically easier to keep a customer than to find a new one, all messaging and reward systems need to be packaged around a “customer for life” philosophy.  And a pay-for-performance compensation system is a must.  Moreover, it can’t be black box; people need to be clear as to what rewards can be expected from results and behaviors.  Once you’ve got all that organized, creating an environment where people have freedom to act on behalf of the customer is crucial. You can’t have a circumstance where people are bound by the linear strictures of a traditional command and control organization. It not only frustrates your employees, it also makes for dissatisfaction on the part of the people on the other end of the phone.