Art Petty on Management

In support of (the people that have to complete) performance appraisals

This is the time of year when it is popular in the business press to criticize performance appraisals and everything about the performance appraisal process.  Consultants and critics roll out their long lists of everything that is wrong with sitting down once or twice a year and telling someone what's wrong with them and what they need to change. 

Of course, the consultants and pundits are fundamentally right, there are many problems in the way organizations structure and managers deliver performance appraisals.  However, the small victory of being right in this case doesn't help the thousands of well-intentioned managers sitting at their desks staring at the stack of performance reviews that they need to complete.

Today, instead of doing my best to describe everything that I think should be fixed in the performance evaluation world, I am offering my empathetic and hopefully, helpful suggestions for the managers about to embark on the lonely and painful journey of figuring out what the real measurable difference is between "meets expectations" and "exceeds expectations." 

A Manager's Survival Guide to Completing the Annual Review Process and Doing a Good Job

• Every person on your team deserves your undivided attention while completing the review paperwork.  Block out time, turn off your cell phone, close your door or find another location other than the office to work on reviews.  The local library is my favorite choice.

• Hopefully, you've been meeting with your team members regularly, providing constructive and positive feedback and even discussion professional development.  If you've been doing your job in this regard, an important preparation step is to take the time to run through your physical and mental notes of those discussions and the outcomes. 

• Make certain that you understand the rating system used for your performance reviews.  If the instructions are not clear and you missed the training session, check with the responsible HR specialist to clarify the rating system definitions. Also, remember that you don't look better if everyone on your team has a high rating!  That's an old game and everyone above you sees through it.

• Effective feedback is specific (fact-based), focused on behaviors (the what not the who) and supported by a business rationale.  Every comment that you write must incorporate these components!

• When offering constructive feedback (the tough stuff), avoid sugar-coating the message.  Excessive sugar-coating is commonly used to soften a difficult message, but what usually happens is that the real message gets lost.  Remember, specific, behavioral and fact based.  Oh, don't forget brief.  As my partner says, "Use the one sentence-one behavior rule."

• Don't write all of your reviews in one sitting.  In fact, don't write more than one review without taking a break to clear your mind.

• Never write performance reviews when you are in a bad mood--for obvious reasons.

• If your associate has not heard your constructive or developmental comments in earlier discussions, you've got a problem.  Reviews are never time for surprises. 

• Review your reviews with your direct manager.  S/He will be slightly more objective about the performance of your associates.  Your manager may be able to offer suggestions to tighten up feedback, and better align development opportunities with firm or department goals.
  

• Carefully plan the performance review discussion.  Now is not the time to wing it.  Think through your core message points, plan your opening statement, and plan how you will cover your key constructive points with your fact-based, behaviorally focused, business oriented, brief comments.

• Pre-schedule  your review meetings and block out an appropriate amount of time for a quality, constructive discussion.

• Pay attention to body language (yours and the recipient's).  Your posture, demeanor, eye-contact, and facial expressions communicate volumes to your associate.  Alternatively, your associate's body language will provide you clues on how your message is being received.

• Encourage questions and healthy dialog.  Your associate should have an active role in helping create plans for development or behavior change as well as for goal setting.  Additionally, you should encourage your associate to ask clarifying questions on the ratings or your comments.  Be prepared to provide honest answers as well as to admit if you need to follow-up.

• Schedule your follow-up discussion and summarize the agenda at the close of the meeting.  IF you've not done a good job conducting regular discussions, now is the time to start. 

• Consider adding an Individual Development Plan (IDP) component to your work with your associate.  The IDP process can be formal or informal, and provides you and your associate with the opportunity to think about next step (and beyond) career objectives and to identify developmental assignments and needed training.  The IDP alone is a great reason to sit down regularly, talk about progress and performance and identify new learning opportunities.

The list is by no means exhaustive, but hopefully, you will find some helpful suggestions to improve your process and your results.    As a leader, your role in helping evaluate and supporting the development of your associates is core to your existence.  In our firm's research, the majority of managers surveyed over a multi-year period indicated that they wished that their managers were better at providing feedback. The performance review process is one of what should be many points in time over the year for you to meet expectations!

Great suggested readings: Everybody knows the performance appraisal system is broken, by Wally Bock, and The Six Dimensions of Effective Feedback, by Rich Petro.

Trust and Team Performance

Earlier in my career, I remember rankling at a comment from an outside adviser that suggested that  our management team did not trust each other enough to deal with the tough issues.  I disagreed.  We were all motivated, experienced professionals, committed to doing what was right for the business.  Surely we could hunt down and eliminate any elephants that were lurking in corners or that wandered into the room.  It turns out, the adviser was right and the elephants thrived and multiplied!

In fact, the adviser was right about "trust between team members" being an issue for every team and something at the center of most teams that never quite hit their stride.  I can think of many career experiences and consulting assignments, where a lack of trust was at the epicenter of a dysfunctional team.  A few examples:

• The management group that built a market leader in electronics and then let some gigantic egos  get in the way of working together, only to see the business disappear from the markets that it formerly led. These "leaders" came to dislike each other so much, that they never would meet as a group. There was anything but trust between these so-called team members.

• An otherwise capable, cross-functional team was forced for political reasons to add a  functional executive's henchmen to the group.  It was clear that this "toxic" individual was not on the team to do anything other than protect his manager's turf, and the team performance degraded considerably.

• A cross-cultural development team (American and Japanese) never overcame their differences in context or style and instead of an integrated approach to developing new products, they divided their efforts and ultimately failed.  This former market leader flat-lined on revenue while during the same four year period, their more nimble competitor grew 7-fold.  Capabilities, capital and expertise were not issues--team performance was.

• The new CEO of a major technology player described his management team as "collegial" after his first few months on the job.  What he meant to say was that they would not take on the tough issues.  After the first year, all but two members were replaced.

The many and varied approaches to facilitating the development of trust between team members are too lengthy for a single (or even a dozen) blog postings.  Over time, I will return to this topic and offer ideas, suggested resources and perspectives on what I am seeing working with other teams.  For today, think about the team(s) that you lead or that you are involved with, and ask yourself the following six key questions about the level of trust between team members.

What's the trust-level on this team?

1. Are we comfortable with each other?
2. Do we truly understand the professional and personal motivations of each team member?  Are the agendas clear?
3. Do we talk openly and constructively about individual and team performance?
4. Are we good at problem-solving as a group?
5. Are new ideas and new approaches welcomed, discussed and sometimes adopted?
6. Are our results good?

While by no means an exhaustive list, if you ask and answer these questions honestly, you might just get to the heart of why things are working or why they are not.  And when your adviser looks at you and says that your team has a "trust issue," your first inclination won't be to disagree. 

Keeping it In Perspective

No thoughts on compelling business issues today, other than the reminder to everyone about the importance of keeping the activities of your life in proper perspective.  Family, food and football have become the staples of the American Thanksgiving, but it doesn't hurt to be reminded that we are all on a similar journey of unknown duration.  Here are a few "prompters" for putting things in proper life perspective:

• Family is what counts, everything else is just politics and money-Paul Byrne.  Can't say it any better than that!

• Man plans and God laughs-Eric Lieberman from Archie and others.  Remember that when things don't work out the way you expect.

• Most people go to their graves with their music still inside them-source undetermined.  Get the music out!  Don't leave anything on the field!

• The 2 columns in the WSJ that appear every year on the Wednesday before Thanksgiving--The Desolate Wilderness and, And the Fair Land.  If these two columns don't make you set aside your perspective on all that ails this country and realize how fortunate we truly are, you're hopeless. 

• Attending an event to celebrate the life and passing of a 95 year old lady who saw and lived everything the 20th century had to offer...from flight to depression, wars, moon landings and the remarkable ebb and flow of civilization during an incredible period in time.

• Helping your kids get up when they fall.

• Letting your kids fall to help them learn.

• Engaging with great people to create, whether it is at work or otherwise.

• Remembering that it is your job to make a positive difference in someone's life.

• The Green Bay Packers--sorry, couldn't pass that one up.

Have a great and enjoyable Thanksgiving, and if possible, carry the wonderful perspective that this day offers into your workplace on Monday.

-Art

Management by Consensus-The Tyranny of Mediocrity

Developing an Effective Decision-Making Style is One of the Many Challenges of New Leaders

Many managers and most early-career leaders struggle with their responsibility for decision-making.  Some leaders are fearful of exposing themselves by making a bad decision and therefore, avoid this responsibility.  Others feel empowered by their station and make frequent, unfounded and ill-advised decisions, mostly driven by ego.  And perhaps the majority of early-career leaders that I train and coach, place a lot of stock in the consensus opinion of their employees.  This latter technique, management by consensus, is a dangerous style to employ as a leader. 

Consensus Clouds Clarity

A leader that attempts to reduce decision-making to the average of the individual opinions of his associates is a leader that has delegated one of his core responsibilities.  Usually, the inexperienced manager will seek the consensus of his team in the hope that this compromise to alternative opinions will provide common ground for those with conflicting opinions.  Almost everyone leaves the process feeling cheated.  Here's what happens when consensus rules the day:

• Potentially creative solutions to problems are diluted and blended to the point where the probability that they will be ineffective in solving the problem in question is high. 

• Instead of feeling good about the compromise, individuals leave the discussion frustrated, upset or even angry about what just happened.  Consensus management does not create motivated employees.

• The leader's credibility is weakened or destroyed. The leader's role is reduced to one of arbitrator.  Everyone has viewed the  leader's unwillingness to sort through the issues, listen to ideas and choose a course.  People want and expect their leaders to be appropriately decisive. 

• The more politically astute employees quickly recognize this weakness in their leader and are effective in identifying ways to exploit her inability to make a decision for their own ends.

• After a period of time, management by consensus damages the working environment, grinds productivity to a halt, puts any hope of innovation out of mind and demoralizes the employees.  In the negative, management by consensus is remarkably powerful!

What's a New Leader to Do?

• Ensure that you are always well-grounded in understanding your team's objectives and how they impact the pursuit of the firm's strategic priorities.

• Cultivate your skills in developing and asking questions as a means to sift through the ideas, issues and thoughts of your associates.

• You pay people to manage and decide--provide the opportunity for them to do so and to take risks and fail.  Politely answer their "What should I do?" questions with: "What do you think you should do?"
  

• You need to assert yourself when an incorrect decision might take an individual or team off-course from the organization's objectives.  You will be unpopular to some but respected by all for making a decision.  You are in charge..don't delegate responsibility for the key issues.

• Treat dissenting issues and dissenters with respect.  Often the difference in opinion is small but the semantics make it appear big.  It is appropriate to seek clarity for people's perspectives.  You should look for the nugget of gold in every perspective...but you don't have to combine the nuggets at the same time. 

• Depersonalize the issues and decision-criteria.  Make certain that you are focusing on the business impact of an issue.

• Resist the political ploy of "decision making avoidance" as a strategy for survival.  While your name will not be attached to bad decisions if you use this common tactic, your name will not be attached to any successes either.  It's a flawed strategy. 

Decision-making in Play:

When Dwight Eisenhower served as the Supreme Commander of Allied Forces during World War II, he faced the dilemma of sending many to their deaths with the invasion of Normandy.  Balancing many variables, the window to go or wait came down to a poor set of choices.  On the day planned for the invasion, the weather was uncooperative and the fog and cloud cover would keep Allied bombers from supporting the invasion force.  Eisenhower's team was split over the decision to invade or postpone.  As was observed and reported, Eisenhower stared out the window into the fog for a long moment, turned around and said, "We'll go."  The fates of many and the world political order were sealed in that decision.  The rest is history.

Recently, the Illinois football team was on the brink of beating number one ranked Ohio State.  It was 4th and 1 in Illinois territory with over 8 minutes to go and the Illinois coach decided to punt.  For some reason, Ohio State called a timeout and during this interval, the Illinois QB convinced the coach that they had not worked hard, practiced early and long for months (and for much of their lives) to give the ball back to Ohio State and lose with a potential drive.  The coach reversed his decision, Illinois went on to make the first down and ultimately eat up the clock en-route to the major upset of the year. 

There is no right way for all situations.  Decision-making is an art form--as a leader, you need to cultivate yours.  Just don't let the tyranny of consensus rule your style. 

Leadership Development and Technical Professionals

My partner and I recently launched a research initiative into the challenges that technical professionals face when jumping on the leadership path. We are actively interviewing and surveying professionals in development, engineering, IT and consulting, and drawing upon the considerable experience of many of our long-term associates including-Joe Zurawski, Jerry Deville at Construx, Jack Kalander at Business Objects etc.  (By the way, we want your input too...share your perspectives by clicking here and taking our survey!)

While both of us have invested a combined 45 years in and around technology organizations, it has only been in the last few years while researching and publishing  Practical Lessons in Leadership and developing the related training programs, that the challenges and pitfalls of becoming a leader in a technical arena have become so crystal clear.  As top leaders, we are setting up some of our most valued contributors to fail miserably, and that's definitely not good.

The all-too-common scenario has the brilliant engineer/developer/IT professional recognizing that they are bumping up against an organization's ceiling for individual contributor compensation.  They've likely watched as their friends have moved into management roles, and it is no secret that along with promotion to management comes improved compensation opportunities.  The natural response is to walk into their manager's office, stare him or her in the eye and boldly pronounce that it is time for them to lead a team!  Fast forward a few months and a few repeated discussions about leading a team, and the manager, motivated by a fear of losing this valued contributor, acquiesces and the firm has a new manager.  From this point on, it's all downhill.

Our early research and anecdotal discussion feedback shows that:

• Many first-time technical leaders receive little or no developmental support (coaching/mentoring/training) for their transition into leadership.

• Frequently, these competent individual contributors are moving from a peer role to a leadership role--again without the needed training/support to help deal with the additional complexity of a new relationship with long-time associates.

• Many first-time leaders admit that they don't have clear context for their new role, and tend to spend a lot of time focusing on technical issues instead of leading the team. One early-career IT Manager said it best.  "I'm a techie at heart.  If faced with a people-problem or a technical problem, I know which way I'm heading."  (Hint: he was not heading for the people problem!)
  

Clearly, these otherwise talented technical professionals don't immediately realize that the skills that made them successful as an individual contributor are not the skills that they need for success as a leader. 

The fallout from misplacing or under-supporting new technical leaders  can be significant.  The new manager quickly gets frustrated or becomes disillusioned, his or her poor management practices impact the performance and morale of other team-members, productivity and quality can slip and the entire organization suffers as a result.  This domino effect is very real and very dangerous to organizational health.

While the research efforts are just beginning, there are 3 obvious opportunities for senior technical leadership to make an immediate improvement in this situation:

• The rationale for pursuing a leadership role is driven by a limited/limiting individual contributor career track.  Technical professionals should not be forced to pursue a management role as the primary or only means of advancing in their careers and growing their incomes.  Fix this!

• Not everyone should lead!  Start applying more rigorous up-front filtering of aspiring leaders. Existing managers/leaders should be trained in how to provide informal leadership opportunities to interested candidates and to ultimately help a candidate determine whether a leadership role is appropriate for them.  Of course, existing managers need to learn to filter and say "no" when it makes sense.  The existence of a viable individual contributor path will minimize the potential damage from a "no" answer.

• New managers need care and feeding.  They should be trained and coached, and they should be on the receiving end of ample effective feedback (positive and constructive).  Existing managers need to understand and be accountable for their role in developing new leaders.  Anything less is asking for trouble.

Organizations cannot afford to sub-optimize in their technical functions.  In a world where IT is increasingly involved as a key enabler of strategy, where development is challenged to pull off heroics on a regular basis and where competitors are waiting to pounce on your every misstep, you cannot allow something as curable as poor leadership development practices to derail your business.

More later as the body of research grows.    

The Best Leadership Books are Not Found in the Business Section

I'll say it again.  In my opinion, the best leadership books are not found in the business section of your library or local bookseller.  This is a bold (or at least controversial) claim from someone who just spent 14 months co-writing and publishing a book on leadership that is carried in the business section.  In spite of the time investment, I am still of the opinion that the most powerful readings on leadership are found by looking in the biography and history sections. 

Biographies Provide a Unique View Into the Minds of Great Leaders During Times of Success and Failure.

The same fundamental rules of leadership apply whether you are leading a team inside an organization
or leading a country in the face of invasion, albeit they are highly magnified in the latter situation. The leader in business or statecraft is faced with ambiguity, competing perspectives, strained or insufficient resources, motivated adversaries, significant consequences for failure and solution sets that likely have big risks and potential suboptimal outcomes. A typical day at the office for most businesspeople and world leaders.   

Understanding how historical figures navigated their crises, managed their teams and dealt with failure on the road to success provides critical context for our own roles and activities as leaders. The historians and biographers offer us a unique opportunity to study well-documented examples of leadership success and failure, and we can leverage those learnings in our own daily activities and decision-making. 

A Few Favorites that Deliver Powerful Lessons in Leadership:

• Winston S. Churchill, Memoirs of the Second World War.  Churchill offers the reader a window seat to the defining event of the 20th century and his remarkable leadership successes and blunders along the way.  If you are not up to the 6-volume set, try the abridged version at a little over 1,000 pages.

• Two great choices on Lincoln--Carl Sandburg's classic multi-volume set or the more recent biography by author David Herbert Donald.  It is hard to comprehend the scope and complexity of the issues that Lincoln faced.  His multi-year pursuit of a general that could lead, the constant derision that he faced from  almost everyone and his tenacity in spite of several years of failure during the Civil War.  Imagine his thoughts as he sat in his office in a virtually unprotected capitol, staring at the smoke rising from the campfires of the adversary just a short distance away. If you are having a tough day, a few minutes sitting in Lincoln's seat will put things back in perspective.
  

• Patriarch-George Washington and the New American Nation, by Richard Norton Smith.  Smith chronicles Washington's later life and submits that it was his character, not the new constitution that held the young republic together.  There was no precedent for the role that Washington assumed as President and understanding how this remarkable man navigated this complex, highly ambiguous situation is an educational experience for every leader. 

• Books by and about Ernest Shackleton and the Endurance Expedition.  Shackleton's leadership in the face of a dire life or death crisis and his extraordinary efforts to ensure the safe rescue of his crew are inspirational reading.  His efforts during the Endurance crisis truly defines the role of a leader in serving his team. 

• Two additional Presidential readings: Truman, by Margaret Truman offers personal insights into the man that was put in the unlikely spot to end World War II and faced the horrific dilemma of invading Japan or dropping the first atomic bombs.  Theodore Roosevelt, by Nathan Miller, showcases Roosevelt pursuing and achieving his vision of bringing the U.S. to the world stage for the first time. 

The next time you are looking for inspiration or motivation, or one of your associates ask for some suggested readings in leadership, aim for the biography section of the bookstore first and share the journey of those that served and led and ultimately changed the face of the world. 

If you have some suggested readings, please let me know and I will be happy to add to the book list. 

Finding Talent in Unusual Places

One of the chapters in my book (with Rich Petro), Practical Lessons in Leadership, emphasizes the role of the leader as Chief Talent Scout and Developer.  A lesson that I learn frequently in my travels on business and in my consumer experiences is that some of the most talented potential employees can be found in the places that  you least expect to find them.  Of course, you have to have your talent scouting eyes wide open or it is easy to miss an opportunity.

• The stylist that cuts my hair is the informal salon leader (absentee owner situation) that everyone looks to for direction and decision-making.  It turns out she is a leadership junkie, attending every seminar that fits her schedule, reading voraciously on the topic and applying what she learns in the salon.  She experiments with team-building, provides effective and timely feedback on performance and relays lessons learned from her mistakes. Instead of the trivial conversation most people engage in when getting their hair cut, we have spirited discussions about all things leadership.  Every time I walk out after a haircut, I shake my head and the leadership savvy that Melinda displays and I remind myself to hire or refer her at the first opportunity.  (She also lingers over my haircut, occasionally clipping at nothing...making me feel better about the fact that my hair volume no longer justifies her price.  I go for that and the leadership treat!)

• Some of the worst consumer experiences in the world happen in cell phone stores.  Or so I thought, until I watched in amazement as a twenty-something floor associate simultaneously managed an irate customer--placating him by solving a problem, while answering machine questions thrown at him by the other, less experienced associates.  When it was my turn, this consummate customer-focused person stayed with my challenging account transfer issue during 2 days, working through big company bureaucracy to solve my problem.  I wrote his boss a letter and I made note of his name and contact information.  The next time I need an early career professional in a customer service capacity, he gets the call.

• I frequent a particular home improvement store (small, not big box) because one gentleman that helps me is one of the best strategic planners I've ever met.  He listens patiently to my project description and then launches into a series of questions that has me completely rethink what I was trying to accomplish and how I was going to go about it.  He looks at the big picture of my project and then drills down to show me how to execute.  He even takes phone calls if I get stuck!  While he appears to be happy in semi-retirement, I think about his approach to my home improvement projects when I engage clients in their business improvement initiatives. I haven't figured out how to hire him yet, but I will!

There is no rule that says that the talent that you surround yourself with has to come from the same mold or carry the same pedigree.  If you open your eyes to some of the great experiences that people create for you in some of the most mundane settings, you might just find the people you need to help propel your business into the future.  Happy Talent Scouting!

Towards More Qualified Leads in B2B Marketing

"I'm frustrated with marketing.  I don't know how we decide to allocate our investments and I don't understand what we are getting in return."  This was the lament of a $100 million B2B company CEO that I spoke with recently.  This CEO observed a lot of activity but was inherently uncomfortable with his inability to understand what the benefit to the firm was from all of the spending and activity. This CEO is not alone.

Unfortunately, many marketers shoot themselves in the proverbial foot by failing to provide transparency and context to their activities and results.  My article, Marketing Misunderstood, explores this concept in more detail and offers some practical solutions for management teams to consider.  Today however, my focus is on ideas to improve improving qualified lead generation by suggesting a set of Lead Management Processes that help organizations understand their leads from initial contact through closure.

My suggestions:

• Qualified Lead Generation should be tracked as an important part of the marketing and sales KPIs.  The quantity of raw contacts, qualified contacts and "leads" should be visible to the broader management team in operations reviews or on demand.  Ideally, the marketing and sales leaders have shared accountability for "total pipeline metrics" which includes qualified lead growth.

• There must be a clear lead qualification process with distinct criteria for how to categorize each contact.  The sales team owns the definition of the lead qualification criteria.  Sales and marketing must collaborate to define the qualification and disposition process.  The sales team must incorporate the lead process into their sales process model. I encourage teams to establish a few very distinct categories for what makes something qualified or not.  Highly qualified leads must have a reasonable probability of closing in the near term, while an entry-level qualified lead might be the beginning stages of a long-term project.  Someone seeking information through a web site is a contact until proven guilty of having a legitimate, funded need.
  

• A formal lead qualification function that manages the individual contacts is inexpensive to establish and essential for success. The "Qualifying Reps" own every contact and are responsibly for initial classification and communication with the assigned sales representative.  If a lead is classified, it moves into the sales-lead pipeline and out of the qualifying pipeline.  If a sales rep determines otherwise, it comes back to the Qualifying rep for incubation and management over time.  Every contact must have an owner that is responsible for watching and managing the contact, and ideally, moving it along to the next step in the qualification process. (Article reference: Increase Sales and Marketing with a Formal Lead Qualification Program.)  Note: most firms pass leads through from an Information Center--this is wholly ineffective.

• Every promotions program results in some form of activity or response.  The inquiries and contacts should flow through the system as described in the above processes, with reporting systems set up to track the number of contacts in each qualifying step, the change in numbers from month to month, the age of the contacts, and the outcome from specific campaigns.  Additionally, once the leads move from contact to qualified and are owned by a sales representative, similar metrics should be tracked by each rep, with the rep's ultimate responsibility of closing the lead through a win. 

The CEO's very real lament above is in part, created by not having a view into the types of activities and metrics described in this posting.  Establishing clear processes for managing contacts and viewing and valuing the changing number of contacts and leads over time is one way to improve visibility into how marketing is contributing to the business.  The collaboration between sales and marketing serves as a check and balance  for the process and the numbers and ensures that marketers take their lead generation seriously and that sales associates understand their role in following through on those leads.  Widespread communication of the metrics across sales, marketing and senior management helps ensure a focus on driving results, improving campaign effectiveness and ensuring proper and timely follow=through on leads.  A definite win-win-win for all groups. 

The Role of Strategy in the Evolving Founder-Led Business

Part 1 of Many:

One of the most challenging and important phases in the life-cycle of a founder-led business occurs when the organization has matured sufficiently to require the addition of new talent and the evolution of its operating approaches. 

There is a sizable body of literature on the challenges that  founders and their entrepreneurial team-members face in recognizing, accepting and facilitating the needed changes.  Many otherwise great organizations with brilliant ideas and founders do not navigate these waters successfully.  Some crash spectacularly, some wander aimlessly and a few succeed to evolve from start-up to significant. 

In my experience, one of the key differences between those that fail and those that succeed is visible in the founder's willingness to embrace a more formalized strategy development process.  More formalized that is, than whatever is on the founder's mind at the moment.

In defense of founders everywhere, the word "strategy" and the phrase "strategy process" conjure images of endless meetings, big consulting fees and painful powerpoint presentations supported by spiral bound documents destined to become shelf-ware.  A founder wants to grow a business and see their ideas turned into products and services that fulfill needs and make money.  The notion of taking their over-stretched associates out of the game for days at a time to debate "strategy" is counter-intuitive.  One brilliant founder of a small manufacturing firm remarked to me that, " the strategy is simple--we are going to double in size this year."  I love his optimism and the goal sounds fine, but respectfully, growth is not a strategy.

The addition of a formal strategy process to a founder-led organization is about helping the growing team to learn to think, talk and begin to plot direction for the future of the business.  This "strategy" dialog does not naturally occur in many entrepreneurial organizations, yet as the firm matures it is important to begin talking about next steps.  Too many great start-ups plateau after a few years and then enter a phase of stasis or decline because they have not figured out what to do for an encore after the original idea runs its course.   This risk is mitigated if the founder's  top managers are comfortable and accountable for these types of discussions.   

The rigor of a Fortune 500 strategy process is not the appropriate prescription for the founder-led organization, but there are some universal questions that every team should ask itself as it evaluates options for the future.  (I will highlight these questions in detail in an upcoming posting.)  The willingness of the founder to engage his or her team in this type of discussion and to sustain the discussion, generate actions and begin to move forward, has a tremendous impact on the working environment.  Alternatively, the failure of the founder to pursue this path results in a team that is highly tactical and overly dependent upon the founder for direction. 

Some important caveats to the notion to this idea of instilling a strategy process in the founder-led organization.  While the process may feel to the founder like "letting go" or "losing control," it's not--it's about helping the management team develop.  Also, the founder does not cede the ownership of the vision and mission of the firm to the tyranny of a management team.  Vision and mission and ultimately the key decisions around direction and funding and risk remain squarely on the shoulders of the founder.

Next--The Universal Questions Every Business Should Ask Itself.

 

Recharging at the Kellogg Leadership Conference-Part II

A highlight of the 2007 Kellogg Leadership Conference was the Keynote by Professor Harry M. Jansen Kraemer Jr., a Professor of Management and Strategy at Kellogg and the former Chairman and CEO of Baxter International.   (An internet search of his name offers some great bio material.)  His fast-paced, dynamic and humorous delivery was backed by his consistent refrain about business: "It's simple--not easy but simple."

Professor Kramer addressed the mostly MBA student audience with his perspectives on Value Based Leadership in the form of Six Steps on the Journey.  The advice is well worth repeating.  I paraphrase:

1. Take time to reflect--know what you are all about, know what you value and know your own definition of success.
2. Create Balance--not just work/life balance, but the balance that is right for you.  There are 168 hours to work with each week...know how you will use them.
3. Always, always, always strive to set a positive example.  Remember, everyone's watching!
4. Don't focus on being right--focus on doing the right thing. 
5. Realize that it is your responsibility to create positive change.
6. Never lose the ability to keep it all in perspective. 

Professor Kraemer's parting reminder that we are all only here for a brief instant in time, underscored his refrain that we should seek to do something to make a difference.

We would all be well served to follow his guidance.