Years ago, I was walking down a long office corridor in a nondescript office building. Visiting one of the largest companies in the area, I was being escorted to a conference room. What the purpose of that visit was, I really can’t remember.
But I do remember walking by one room. As I was passing by, I glanced in and saw a man at the front of a room filled with maybe twenty or so people. That would not be in my memory bank except for what I next heard.
“I’m sorry, I screwed that up and let you all down.”
That’s not something you often hear from the front of the room.
I froze, right in the doorway, wondering what he was apologizing for and what was going on. It took me a few seconds to realize that I had no business stopping to watch, so I willed my feet to keep walking.
In those few seconds, I don’t know the details of what happened. But I could discern that this was the boss, and he wasn’t holding back. He had made a mistake and was taking full responsibility for it.
It was impressive. I wonder what the others in that room thought. My guess is that they still talk about this boss of theirs.
“Words can inspire and words can destroy. Choose your words well.” -Robin Sharma
As I said above, this one is powerful because it’s unexpected, and it demonstrates both self-awareness and personal responsibility. That’s not a boss who looks to throw the blame faster than a quarterback about to be sacked.
“Leaders who apologize demonstrate personal accountability.” -Skip Prichard
But Sid Mohasseb, serial entrepreneur, investor, venture capitalist, and former the Head of Strategic Innovation for KPMG’s Strategy Practice teaches an entirely different approach: It’s the ability to adjust your strategy, almost constantly, that brings success. The environment is uncertain and changing, and changing with it is vital.
Sid teaches that we must push for more and evolve from one approach to another.
The caterpillar evolves many times over before it becomes a butterfly. It changes form until it turns into a completely different species. The caterpillar teaches us the wisdom of constant and incremental evolution and offers the promise of flying. To compete, to advance and to win, in our businesses and in our personal lives, we must evolve constantly and purposefully, always.
“Things do not change. We change.” -Henry David Thoreau
How is the game changing? And how do leaders prepare for the constant flux?
Innovation is constantly approaching from every corner of the world. The speed of change fueled by unprecedented technological advancements and constantly increasing customer expectations are challenging companies to “stay relevant” – competitive advantages are temporary. The game has changed from, “How do I gain an advantage and defend it?” to “How do I change to stay relevant?”
To win in a state of constant flux, leaders must shift their minds and change their actions. First, by realizing their addictions (old assumptions, orthodoxies, biases, etc.). Next, by aligning with uncertainty – no plans can be permanent and no decisions are certain. Leaders must learn to live with probability and a portfolio of related plans – always ready to take the path that offers the most likelihood of success. They should also appreciate the reality of their capabilities and aim to build the future in increments; success cycles must be shorter and capabilities (people & systems) have to be created accordingly. Last, leaders must constantly look for the next advantage and aspire for more “Aha’s.” They should look for and discover the next challenge or opportunity, always; innovate, always (create new value), and evolve, always.
“To win in a state of constant flux, leaders must shift their minds and actions.” -Sid Mohasseb
Why do we so often refuse to deal with change and uncertainty?
The refusal is more natural than intentional. We refuse to deal with change because of our fears of unknown (what is on the other side of change) and comfort with the status quo (comfortable routines we are used to and have served us well in the past). Most people embrace change when they i) realize the severity of the problem they face and ii) gain trust that what they can change to is a better state. We often refuse to change because we believe that the status quo does not present a major danger and/or we don’t trust the alternative paths offered by our leaders.
At business school and later at work, we are trained to look for certainty to plan to and execute against – assuming reduced risk. In our personal lives, we are comfortable living with probability and operating in uncertainly – there is a 40% chance of rain, and we decide, based on our risk tolerance, to take an umbrella or not. In our professional lives, we are expected to be certain and execute with confidence in outcomes. People, on a personal level, can innately adjust to uncertainty. However, they are reluctant operating with uncertainty at work because corporations expect and reward the illusion of certainty.
“The only thing that is constant is change.” -Heraclitus
When I was growing up, I spent many weekends camping with my Boy Scout Troop in pursuit of my Eagle Scout badge. One thing I remember about those trips was the campfires and the stories we told. From the scary to the hilarious, those stories created an environment as we entertained each other. No devices, no distractions, just stories.
We may live in a different time, but the power of story remains an important part of memory, of persuasion, and of leadership.
How do leaders align and engage a workforce in the midst of uncertainty?
Authors Kay Kendall and Glenn Bodinson are expert Baldrige coaches. They studied more than two dozen organizations that delivered exceptional results following the Baldrige Criteria, key principles derived and championed by Malcolm Baldrige in the mid-1980s to improve productivity and competitiveness. Their research was supplemented by talking with more than fifty CEOs to gain insights on performance excellence. I recently asked them about their work and their new book, Leading the Malcolm Baldrige Way.
What do readers, who may not know Malcolm Baldrige, need to know before picking up your book? How will studying the Malcolm Baldrige Way help business leaders?
Malcolm Baldrige was a very successful businessman before Ronald Reagan tapped him to be Secretary of Commerce. He was deeply concerned about the future of manufacturing in America. At that time, the 80s, Japan was dominating in the automotive and electronics manufacturing industries. Both of those industries – and others in America – were being plagued by poor quality, and consumers were making choices to go with Japanese products. Secretary Baldrige championed an effort to establish a presidential award based on rigorous standards that would recognize manufacturing and service organizations that achieved high levels of performance. After Baldrige’s untimely death, President Reagan decided to honor his friend with what became known as the Malcolm Baldrige National Quality Award. Studying Leading the Malcolm Baldrige Way will help business leaders in any industry, in any situation – flourishing or in peril – learn how to align their employees to deliver exceptional results.
Why Engagement Matters
To those who think culture is soft, what statistics can you share that demonstrate engagement matters?
One study showed that companies with high levels of employee engagement have five times higher shareholder returns over five years. There is also clear evidence that engaged employees create loyal customers. If that isn’t compelling, consider the flip-side of engagement. Statistics from a recent article in Harvard Business Review cited, “Disengaged workers had 37% higher absenteeism, 49% more accidents, and 60% more errors and defects. In organizations with low employee engagement scores, they experienced 18% lower productivity, 16% lower profitability, 37% lower job growth, and 65% lower share price over time.” Those are staggering costs for organizations.
Engagement is the rage these days in leadership circles, yet still many leaders don’t work on engagement. Why is this?
Honestly, we don’t understand it. The evidence that engagement matters and impacts bottom-line results is clear. There is also the notion that treating employees as valued assets is what leaders as decent human beings ought to do. In the latest recession, we saw a lot of leaders with an attitude of “My employees should be grateful just to have a job.” As the economy picked up, we saw many employees jump ship as soon as there were opportunities to work for an organization with a better culture, where they were treated as valuable contributors to the mission and vision.
Research: Companies with engaged workers report 6% higher profits.
They may seem, at first glance, to have nothing in common—different industries, challenges, experiences, leaders, competition, you name it. But there is something about this group of organizations that drew attention and merited study.
How did you arrive at the common characteristics of organizations achieving excellence?
Effectively these emerged gradually through the research. We studied each institution with an open mind and on its merits. Then we shortlisted, at the conclusion of our research in each case, what we thought were the fundamental drivers of that institution’s enduring outperformance. When we compared the lists we had created across several of the institutions, the common characteristics became evident.
Secondly, because our research process was quite extended, we had the opportunity to use some of the later studies to test and validate hypotheses emerging from the earlier ones.
Finally we used some of our client work, which was progressing in parallel, to further refine our thinking.
I often ask leadership experts whether leaders are made or born. You take on that question with regard to high-performance organizations and say that they are made, not born. What leads you to this conclusion?
Simply put, the leaders who we spoke to in the organizations we researched were consistent in articulating and reinforcing that view. Without exception they talked about how they viewed the enduring sources of their advantage as being their people and their organizations, and they each described their roles as being about setting direction and ambition and then facilitating and enabling their organizations to achieve and extend those ambitions over time.
Even more particularly, given that many of the organizations we researched could be reasonably described as “values-driven,” their leaders saw a fundamental aspect of their roles as being about defining, representing, facilitating and rewarding those values in their organizations. The Mayo Clinic, Tata, Doctors Without Borders (Médicins sans Frontières) and the US Marine Corps were particularly strong examples in this regard.
“Overengineered engagement initiatives can become impersonal and feel false.”
Let’s talk about the four-pillars to delivering high-performance.
Copyright Brian MacNeice and James Bowen, Used by permission
Every organization knows it needs a plan. Where do most go wrong?
There are lots of ways in which organizations go wrong when it comes to planning, but for this discussion we will highlight two that we observe again and again in our work.
First, we suggest that organizations go wrong by planning on a basis of “inside-out” rather than “outside-in.” That is to say, their leaders tend to look at last year’s model and last year’s performance and identify tweaks they can make with a view to delivering incremental performance improvements next year. This model of planning tends to be short-term and tactical in nature and anchored in a historic, likely outdated, view of the world.
High performance organizations plan from the outside-in, not inside-out.
High performance organizations come at planning from the outside-in, using a much more strategic, future-oriented approach. They start by looking outside their organizations to understand how the context within which they operate is changing. Sometimes they do this by looking at their organizations through a series of discrete “lenses” – for example industry, market, customer, competitor, technology, regulatory, people – to understand (a) what dynamics they observe, (b) what opportunities and/or challenges arise as a result of these dynamics, and (c) how these dynamics might play out over the course of their planning horizon. Armed with these insights – in particular a much deeper understanding of cause-and-effect – they are better positioned to create strategies that bridge from where they are now to where they want to be over time. Relative to the first approach we discussed, plans developed this way tend to be more ambitious, radical and lower risk all at the same time.
Second we would suggest that organizations go wrong because they view planning as a task rather than as a capability. They view it as a chore to be endured once a year to fill a template, and which brings with it a significant cost in terms of time away from the frontline. Their engagement and investment in planning reflects this attitude – for them it’s about getting to the end of the process as quickly and painlessly as possible.
The approaches we observe in high performance organizations, by contrast, are more consistent with Eisenhower’s famous mantra that, “Plans are nothing, planning is everything.” They understand that their organizations, and the worlds in which they are operating, are always changing, and as such they develop planning as a dynamic, enduring competence. They operate “with their heads up,” tracking changes in their context all the time, taking on board the lessons of their experience and factoring insights into their plans on an ongoing basis. Some of these organizations have moved away from a traditional, annual model of budget-based planning towards a more continuous, iterative model of strategy development and deployment.
“Plans are nothing, planning is everything.” -Dwight Einsenhower