Sustainable Transformation

Just Give Me the Bottom Line!

Monday, February 1, 2010 by John Latham

"Just give me the bottom line." Experience suggests that many executives do not want a lot of information; instead they want the “bottom line” or a few options to choose from. Staff are trained to do the analysis and develop a few options for the busy executive to choose from. Unfortunately, all too often this process allows the executive to avoid their own detailed analysis and limits the depth of their own systems thinking and understanding.

Transformational leaders use detailed information to understand the internal and external systems and environments and develop proactive strategies to succeed in today's complex and dynamic global environment. A systems thinking approach requires a comprehensive scorecard to analyze the complex and dynamic relationships in the modern organization and operating environment. In-depth analysis of the system enables the identification of key leverage points that create sustainable organization change.

The transformational CEOs in a recent study were strongly motivated to work with facts and knowledge and seemed to always want to know more. In fact, when compared to other effective leaders, the participating transformational CEOs had more in common with employees with respect to the information they were motivated to work with than the other leaders. As one Transformational CEO noted, “Baldrige organizations are very fact based. They also know that running tests and trials are critical to successful product or service changes that will impact customers and clients. These companies tend to be more measurement based (objective) vs. subjective. There is an old saying about ‘In God We Trust...all others must bring the facts’....”

Art and science of designing, managing and improving the organization system requires many types of information to help illuminate the system as well as systematic methods for improvement. All of the Transformational CEOs in the study used four very fact-based continuous improvement processes including: (a) strategic management system; (b) continuous improvement process (PDSA, Six Sigma, Lean, etc.); (c) benchmarking; and (d) Baldrige-based assessment and improvement. In addition, they used a leadership system with a comprehensive scorecard and results that included the current performance levels, trends over time, and comparisons to other high performing organizations to understand their performance and develop plans for improvement.

Read the research report on CEO Attitudes and Motivations.

Apple iPad: Not an Innovation in eBook Readers and no Kindle Killer

Thursday, January 28, 2010 by Chad McAllister

Along with many others I was anxious to hear the details of the much awaited innovation in tablets from Apple. I followed the announcement by Steve Jobs on several blogs that were covering the details as quickly as they could. While the new iPad certainly has "cool" it is not the eBook reader I was hoping for. I have been looking to Apple for the innovation and design capabilities to create the eBook reader of my dreams. Unfortunately, I am left to dream longer. The three reasons the iPad is not my next eBook reader are:

No ability for mark-up. I want to use e-books just as I use traditional books. This includes the ability to write on the book -- underline, highlight, and make notes in the margin or over the text itself. I was hopeful with a touchscreen display that the iPad would make this possible. However, without support for a writing stylus the ability to take notes in an e-book is not practical.
Backlit LCD screen. Now that we have been introduced to electronic ink displays, such as Kindle, why would I want to take a step backward and read on a traditional computer screen? An IEEE article explains well why the iPad is no Kindle killer because of the display.
Publishers. The number of publishers will no doubt increase, but the list is currently rather small. Further, with my teaching hat on I want to see textbook publishers support eBook readers. Until my first objection is addressed and we can "write" on our eBooks, electronic textbooks will continue to have low appeal.

Of course there are many things that make the iPad appealing as an eReader:

Great form factor -- just like a piece of paper.
No keyboard -- why waste the space when you have a touchscreen.
Weight -- less than most books I carry.
Battery life -- read all day without recharging.
Music -- enjoy music while reading.
Price -- $499 is very reasonable if this was my dream eReader.

What do you want in your dream eReader? Please let me know your thoughts in the comment area below.

Transformational CEOs Focus on Systems!

Thursday, January 21, 2010 by John Latham

In a resource constrained environment, achieving and sustaining high performance requires systems thinking to identify the "leverage points" that will have the greatest impact on overall enterprise performance for the least amount of effort and expense. Successful leaders are "architects" of enduring organizations by designing systems that create sustainable high performance for multiple stakeholders. Not only are successful leaders skilled at systems thinking, they are strongly motivated to work with systems and processes.

According to Bill McDonough, design is the first signal of human intent. The corollary - management and leadership system design is the first sign of leadership intent. Many of the transformational CEOs in a recent study demonstrated the ability to understand the organization as a system. The CEOs in the study understood the causal chain of engaged employees, quality products and services, customer satisfaction and financial success. This systems thinking approach enabled them to improve individual components in ways that improved the performance of the overall system.

While the design of the leadership and management systems are the first signal of leadership intent, the ultimate goal is overall organizational culture change. Sustainable organizational change requires the new behaviors and methods eventually become embedded in the culture of the organization. Our research suggests that the longer the new system is in place, the greater the chance the new behaviors and methods will become "habits" and result in an enduring organization.

Read the research report on CEO Attitudes and Motivations

Transformational CEOs Hold People Accountable

Thursday, January 14, 2010 by John Latham

Successful organizational transformation requires follow through and accountability. Many organizations develop compelling visions and strategies but fail to follow through and implement the changes required to make the vision a reality. Once the vision and strategy are set, transformational CEOs follow through and hold people accountable for the necessary changes in behavior.

Overcoming resistance to change is key to sustainable organizational change. Transformational CEOs effectively address resistance to change. As one CEO in our recent study noted, "my basic belief in people is that I would rather work with them and do everything I can to help them get through denial and get on the right track." Or as another CEO described it, “we are going to try it one year, if it doesn’t work we will go back to what’s not working now.”

Resistance to change often requires persistence or as Jim Collins found, a high degree of "fierce resolve." Transformational CEOs are tenacious and hold people accountable for the deployment of change. While transformational CEOs coach their people through the change, most of the transformational CEOs in the study eventually had to get rid of a few employees that didn't change and support the transformation and new desired reality. While some of these employees left on their own, half of the transformational CEOs had to force some employees to leave. Tolerance of behaviors and actions that are not consistent with the organization's chosen direction can undermine the transformation.

Read the research report.

Reference

Collins, J. (2001). Level 5 Leadership: The Triumph of Humility and Fierce Resolve. Harvard Business Review, 79(1), 11.

Transformational CEOs are Reflective and Learn from Experience

Monday, January 11, 2010 by John Latham

Leading transformation requires leaders at all levels to reflect on the past and use experience to make decisions and develop strategies for achieving competitive advantage. According to a recent study transformational CEOs have a higher than average “Past” orientation to time. This indicates the importance of experience, may well motivate them to learn from experience and provides the experience base with which they can use to make decisions about the present or future. In addition, transformational CEOs have a focus on the future score that is significantly higher than the standard comparison group. The combination of using the past and future perspectives means that these leaders are motivated to learn from the past and use that knowledge to inform the development of strategies for the future.

Transformational CEOs in our study all used four systematic methods to facilitate continuous learning and improvement: (a) strategic management; (b) organization assessment using the Baldrige Criteria for Performance Excellence; (c) benchmarking and comparisons; and (d) continuous improvement methods. All four approaches involved assessment of processes and performance and the results associated with organization changes. In other words, they all learned from performance "trends" which provided feedback on the effectiveness of previous changes. These learning methods combined with a systems thinking approach enabled leaders to develop sustainable business strategies.

Results may not always reflect the performance that we had hoped for but they always provide an opportunity for learning. Later in his life, Dr. W. Edwards Deming changed Plan Do "Check" Act to Plan Do "Study" Act to better reflect the intent of the process improvement step of examining the results and learning from them to inform future actions. Unfortunately many organizations and leaders are very good to Plan Do, Plan Do, Plan Do...and they often do not take the time to study the results, learn from them and adjust future actions based on those learnings. Creating and sustaining high performance requires a disciplined approach of learning from the past and creating the desired future based on reflection and learning.

Read the Institute Report on Baldrige CEO Attitudes and Motivations.

Sustainability Redefined? 3 Required Components

Monday, January 4, 2010 by Chad McAllister

OK, this post is overdue. I had thought the concept of sustainability was rather well understood but I have been reminded several times in the last few weeks that we still have some work to do. One instance was the December cover of PM Network (a Project Management Institute business magazine and a useful resource) where it states "Sustainability Redefined: It's not just about the environment anymore." I have seen this cover on my desk many times since December and each time I think "I need to blog on this" so I am.

When did sustainability mean green? Clearly it must have because many people hear "sustainable business practices" and they think green and environmentally friendly. How do green initiatives themselves make a business sustainable? What happens when the business stops making a profit -- can they sustain operations for long?

No, being sustainability does not mean being green. It does mean creating and operating an organization that can endure (sustain) for the long-term. Although sustainable innovation and organizational change strategies are clearly required for such organizations, sustainability is best described in terms of the tripble bottom line: financial, environmental, and societal (Elkington, Emerson, and Beloe, 2006).

This is also being phrased as the 3 Ps: profit, planet, and people. Ethical behavior is viewed in relationship to being good stewards of all three areas:

Pursuing profits because that creates a strong organization that can be responsible to the planet and people. Without profit we can't finance the other two important and necessary Ps.
Caring for the planet by interacting with the environment in a way that creates a sustainable (long-term) and responsible business model -- often this can reduce costs.
Treating people and communities with respect because these are current and future employees and customers.

Are you still thinking sustainable only means being green? While this may be true of a famous frog, it is not true of sustainability. Perhaps a better way of thinking of sustainability is as responsibility -- it is what responsible organizations do.

Reference: Elkington, J., Emerson, J., & Beloe, S. (2006). The Value Palette: A Tool for Full Spectrum Strategy. California Management Review, 48(2), 6-28.

NPDP Certification: A New Year's Resolution for Leading Product Innovation

Monday, January 4, 2010 by Chad McAllister

If you are a project manager, a product manager, or invovled in innovation, you should be interested in the NPDP certification. The New Product Development Professional (NPDP) Certification from the Product Development and Management Association (an international professional association) equips you with foundation knowledge for creating and managing new products. After becoming a PMP (certified project management professional), I found I needed a cross-functional view of product development and this led me to PDMA and the NPDP. Many organizations find that learning the NPDP body of knowledge creates a common foundation of understanding and language for teams involved in project and product management. This body of knowledge covers 6 key areas:

Business and Product Strategy
Product Development Process
Portfolio Management
Leading, Managing, and Working with Teams and People
Project and Product Tools and Metrics
Market and Customer Research

Even if you or your group is not interested in earning the NPDP certification, learning the body of knowledge is very valuable -- it has been for me. Further, as an NPDP, the certification and your business experience is an important differentiation for your career advancement. If you wish to contribute to and lead sustainable product innovation, preparing for the NPDP certification provides a valuable knowledge base of best practices.

Transformational CEOs are Never Satisfied!

Monday, December 7, 2009 by John Latham

While the transformation CEO may be proud of what the team has accomplished, at the same time, they are never satisfied with the status quo - no matter how good that may be. They are constantly seeking to improve corporate performance as part of a continual evolution.

While all the participants in a recent study desired improvement to occur quickly, as one CEO put it, “While you may have to put the ‘rudder over hard,’ the ship doesn't turn quickly. It takes time for culture change and you have to take the group along with you.”

In addition, “Baldrige companies expect continuous improvement in all areas but definitely must have specific breakthrough improvements to achieve World Class performance. I think of continuous as 3-5% improvement in performance and breakthrough as 20% plus improvement. I can't think of any Baldrige recipients as not having both.”

The CEOs in the study “pushed” for both continuous improvement and breakthrough improvement but they realized that creating and sustaining high performance is a long-term evolutionary process.

All of the Baldrige recipient organizations in a recent study used four systematic approaches for continuous improvement or organizational learning including: a strategic management system; continuous improvement processes (e.g., PDSA); benchmarking; and Baldrige-based assessment and improvement.

Leading organizational change toward achieving competitive advantage requires both incremental continuous improvement as well as breakthrough improvements that dramatically shift performance higher.

Transformational CEOs are Collaborative

Thursday, October 29, 2009 by John Latham

According to a recent study, CEOs who successfully lead sustainable organization change are collaborative and they don't think that having sole responsibility is important.

A prerequisite for collaboration seems to be a high level of humility. Over the past couple of decades we have held up several CEOs as celebrities. However, Collins (2001) found that the CEOs of the Good to Great companies were largely unknown. In addition, he found that they had a high degree of humility.

In the U.S. we seem to hold on to this myth of the individual hero. However, the history of the country doesn't seem to support this myth. Barns were raised in the old west, airplanes were built during WWII, and creative designs at IDEO are all accomplished by collaborative teams. As the CEO of IDEO, Tim Brown notes, "The increasing complexity of products, services, and experiences has replaced the myth of the lone creative genius with the reality of the enthusiastic interdisciplinary collaborator" (Brown, 2008, p. 87).

Organization transformation is complex and the probability of success is low. Creating sustainable excellence requires a collaborative leader and a team-based approach.

Download the research report on CEO Attitudes and Motivations.

References:

Brown, T. (2008). Design thinking. Harvard Business Review, 86(6), 9.

Collins, J. (2001). Level 5 Leadership: The Triumph of Humility and Fierce Resolve. Harvard Business Review, 79(1), 11.

Leading Transformation Requires a Different Attitude!

Wednesday, October 21, 2009 by John Latham

Leaders who successfully transformed their organizations and achieved sustainable excellence have a different attitude. In fact, they differ in their attitudes and motivations from other effective leaders in seven ways:

1. Transformational CEOs are less likely to think that having sole responsibility is important.

2. Transformational CEOs are more likely to want to evolve or change and drive continuous improvement.

3. Transformational CEOs concentrate on the past and use experience to make decisions. They also have a strong tendency to focus on the future and use lessons from the past to help develop sustainable business strategies for the future.

4. Transformational CEOs are likely to be intolerant of the actions of others when they differ from their own or are not consistent across the workforce; that is, they are not very motivated to deal with people who have rules different than their own.

5. Transformational CEOs are strongly motivated to work with systems and processes.

6. Transformational CEOs are strongly motivated to work with facts and knowledge (information).

7. Transformational CEOs are less motivated by a desire to be personally recognized for achievements.

Also, there are 17 additional factors that set effective leaders in general apart from the general employee population.

Download the new report from the Monfort Institute on Leader Motivation and Attitudes for leading transformation.

Instant Success vs. Delayed Success?

Thursday, October 15, 2009 by Milan Larson

In a recent conversation with a professional colleague we were discussing the reality that sometimes instant success can lead to non-sustainable organizational change. This colleague was speaking from his own experience based on his organization receiving the Baldrige Award on the first attempt. Since then he has had the opportunity to visit with other BA recipients who did not receive the award on their first attempt, but rather had to keep improving their processes over time to eventually receive the award. As my colleague compares his own organization's current culture and openness to new ideas, he finds the other employees in the organization are over confident in their success and therefore less open to continuous change. Yet, the other organizations that had to work harder to achieve their success seem to have a culture that embraces continuous process improvement. Their longer journey to success for the other organizations has created a collaborative leadership model that leads to long-term organizational transformation.

So what do you say...in order for real transformation to seep into an organization's culture, is it better for organizations to achieve instant success or delayed success?

Change the System to Change the Thinking

Tuesday, October 13, 2009 by John Latham

I recently attended the Baldrige regional conference in Cambridge, MA. The conference featured presentations from the three recent Baldrige recipients. The first session of the day featured presentations from the senior most leader of each of the three recipients.

A common message that continues to emerge from the various journeys to sustainable excellence is the notion of changing the system, which in turn, changes the thinking and behavior of the organization members. If leaders are persistent and continue to reinforce this change it will eventually result in sustainable culture change. All too often leaders will initiate a new process and then move on to other initiatives without seeing the first initiative through. Sustainable transformation requires follow through and tenacity.

The power of changing the system v. focusing on fixing people is not a new idea. Deming and others have suggested that the system is the main cause of behavior in organizations and that management is the only group that can change the system. One of the presenters proposed that organizations should "act their way into a new way of thinking v. thinking your way into a new way of acting." To change action requires leaders to redesign the system.

Unfortunately, all too often organizations approach system change with an engineering mindset v. a human mindset and then wonder why their new system didn't achieve the desired results. Organization systems are, at their core, human systems! Consequently creating sustainable organization change requires a broad systems thinking approach.

As Rulon Stacy, the CEO of Poudre Valley Health System put it, "I expect employees to provide the best patient service and it isn't fair if I don't first meet the employees' needs." The challenge in developing sustainable business strategies is to design a system that facilitates employees in providing the best products and services to both internal and external customers.

Switzerland -- An Innovation Culture to Watch

Monday, October 12, 2009 by Chad McAllister

According to The Global Competitiveness Report compiled by the World Economic Forum, Switzerland has developed a formidable innovation culture to watch.

The Report considers twelve factors to judge a nations global competitiveness ranking, including innovation. Switzerland is ranked second in the Innovation factor while the US holds the top ranking.

Innovation is viewed as critical because it continues even after the other factors run into diminishing returns -- a powerful statement itself!

One aspect of innovation considered in the report is a “workforce with the skills needed to adjust rapidly to any changing environment” (Global Competitiveness Report, 2009, p. 23).

I do not find it surprising at all to see a link between innovation (sustainable innovation at the country level) and the ability for organizations to adapt and change. A culture of innovation = organizational culture change ability.

Leadership is a Contact Sport

Wednesday, October 7, 2009 by Chuck Appleby

"How do we build leadership bench strength?" "What leadership development method has the greatest ROI?" These are question that keep a lot of senior leaders awake at night as they pursue their dream of global business success.

Twenty years ago an influential study entitled The Lessons of Experience made a convincing argument that organizations develop successful executives by providing them with challenging and diverse job assignments. Today, the path to success is not so simple. From Executive Education to Executive Coaching...from Simulations to Second Life...there are a plethora of leadership development tools all laying claim to The Most Effective Method title.

If we are to develop sustainable business strategies, we've got to create a leadership system that uses the most effective means to build leadership capacity. A nagging concern I've had is that so many new leadership development tools bypass what I believe to be the most effective development tool we have...the individual leader coaching and mentoring his or her employees.

Many organizations have turned the job of developing leaders over to HR and/or the Learning and Development functions....to external facilitators and coaches. We can't outsource leadership development and let leaders off the hook. It's imperative that we select leaders who see that their most important role is developing their people. It's equally important that we give them effective tools to develop and motivate their people. Finally it's important that we create a leadership system that reinforces and supports leaders in building bench strength.

A recent study by the Corporate Executive Board (March 2009) concludes that leader-led development is seen by learning executives as the #1 driver of leadership bench strength...more important than job rotations and challenging assignments. The primacy of leader-led development is consistent with research done by social psychologists like Albert Bandura who reinforced the notion that you must experience something in order to change your behavior.

If we are to achieve sustainable organizational transformation, we must emphasize the importance of developing a relationship in which aspiring leaders get frequent, high-quality developmental feedback from their leaders.

Great leaders tell us time and time again that leadership is a contact sport...how can we help leaders at all levels improve their game?

Sources of Innovation -- The Power of Observation

Sunday, October 4, 2009 by Chad McAllister

One aspect of sustainable product innovation is very basic -- where do we find ideas that lead to creating value for customers. A common answer is:

We ask them!

What does this mean? Do we literally ask potential and existing customers what they want? Doing so produces poor and misleading results. A common characteristic of human behavior is the difficulty of articulating what we want before we see it or are exposed to scenarios in the context of the problem. Users often describe their problems in terms of a solution, leaving the interviewer to reverse engineer the solution to define the problem.

Instead of asking customers what they want, another option is to observe them. Observing users removes the obstacles inherent in human behavior. An example from the PDMA ToolBook 2 illustrates this well (Belliveau, Griffin, & Somermeyer, 2004).

Product designers conducted research in Germany to improve a farm tractor. A focus group of farmers was asked about their tractors. One farmer responded that his tractor was perfect and he emphatically requested that the next model remain unchanged. During an interview in the same farmer's home, he reiterated his position that the tractor was perfect as-is. The designers asked to see the tractor. He then proudly showed them his "perfect" tractor, which he had personally customized with over 20 modifications. Only after observing the farmer's tractor did the design team have a better appreciation for what the farmer considered to be the perfect tractor. Relying only on what the farmer said would have produced very misleading research results.

If you are responsible for leading product innovation, make sure observations are part of your toolbox.

Reference: Belliveau, P., Griffin, A., and Somermeyer, S. (Eds.). (2004). The PDMA
Toolbook 2 for New Product Development. New York: Wiley.

Employee Engagement Strategies In Hard Economic Times

Monday, September 21, 2009 by Milan Larson

We know from Gallup's leading research on employee engagement that only 25% of the workforce is actively engaged with their employers. Much of this research, though, comes from economic times that were much more prosperous than our current economic woes. So what is happening with employee engagement when times are tough? According to Leigh Branham and Mark Hirschfeld, 134 out 210 employers surveyed saw lower employee engagement scores from 2007 to 2008. Upon closer analysis, however, there are 5 key factors that highlight why some employers continued to gain employee engagement while others (in these same 5 areas) saw their level of employee engagement decrease. These 5 key Leadership Differentiators are:

Setting clear and compelling direction. Employees value accurate information about where the company is heading, even if it's somewhat unclear during these times. By keeping the employees focused on the future direction, the employees will be working on the "same page," causing a more focused energy which is exactly what the company needs in tough times.
Open and Honest Communication. When the news isn't all that positive, leaders can fall into a trap of thinking that no news is good news and that they'll only communicate when something is looking positive. In reality, the exact opposite is true and when there isn't any news to report, effective leaders communicate there is no news. The alternative to limiting the amount of communication is that the employees will eventually make up their own version of the news. This can be very dangerous because the made-up version of the news could be much worse than the reality.
Continued focus on career growth. When we stop to think about employees' concerns during these economic, we usually assume the employees are only concerned about their current job and whether or not they'll be able to keep it in the near future. That's only half the picture, though. Employees also continue to think about their long-term futures as well. As they consider their long-term career plans, they look to their employers for help with continuous career development.
Recognizing and Rewarding High Performance. The employers whose employee engagement scores increased from 2007 to 2008 recognize they still have to reward people who are working extra hard during these tough times. No, it's not necessarily easy to come up with the same kind of rewards in these economic times but it is possible, it just needs more sustainable innovation to be more efficient with limited funds.
Employee Benefits that communicate commitment to employee. Employers who scored higher on employee engagement in 2008 did a much better job in the benefits area of the survey. It didn't necessarily mean the companies continued to pay more for the employee's benefits. In some cases, it just meant the companies did a better job communicating the benefits that were not going to change. The "no change" message, in and of itself, communicated a commitment on behalf of the employer that the employees security needs were going to satisfied.

Keeping a highly engaged workforce in place is always a challenging task for employers and it is especially tough today. The alternative though, is a workforce that begins to dis-engage which in turn starts to erode the positive experience for an organization's customer. When this cycle starts to develop, employee morale will naturally start to shake--leading to more disengagement. The real measure comes in our response to the challenge. How we respond will determine our ability to sustain high performance much like Sir Winston Churchill's reminder that "kites rise highest against the wind--not with it."

Organizational Culture Change -- Doing More with Less

Sunday, September 20, 2009 by Chad McAllister

I am once again considering the question, "how do we create a culture of innovation?" Many people recognize that this may be the difference between an organization's success or failure, but it remains elusive for many. To stimulate thinking on the question, I have been reading some outstanding organization change books, including:

Transforming Your Leadership Culture by McGuire and Rhodes
Deep Change by Quinn
Diagnosing and Changing Organizational Culture by Cameron and Quinn
Cultures and Organizations by Hofstede and Hofstede
Influencer by Patterson, Grenny, Maxfield, McMillan, and Switzler

They all have very important things to say about changing the culture of an organization. For those of us wishing to create a culture of innovation in our organization, it is useful to step back and consider what it means to change culture itself.

The book I am currently returning to is the Influencer -- it contains an easy to understand methodology for changing behavior that has had profound impact.

If you're looking for a way to do much more with less, read Influencer and learn how to make a difference yourself. The companion website is www.vitalsmarts.com. Culture changes one person at a time, and it can start with you.

Sustaining High Performance - More Like the Game of Chess Than Like Checkers

Thursday, September 17, 2009 by Milan Larson

What's the difference between the game of checkers and the game of chess? The obvious answer to many of us is that chess is more complicated, right? Not so fast...look more closely and you realize there's more to it than that, which might explain how the game of chess is similar to sustaining high performance. In checkers all of the pieces move in the same way. In chess the pieces all move differently. Marcus Buckingham, in his book The One Thing you Need to Know, reminds us that great leaders understand their individual people and encourage them to leverage their strengths. By leveraging their strengths, organizational excellence occurs.

To some of us, we might want to suggest performance excellence is more like the game of checkers because we've heard the advice that we need everyone moving in the same direction in order to accomplish organizational success. In order to move people in the same direction, we try motivate the employees with the same techniques. But this will only accomplish average performance. Sure we can apply the same motivation or the same incentives but it will only work to a certain point. Great leaders, on the other hand, discover each employee's uniqueness and capitalize on it. So how do great leaders make this happen? Here are four skills from the research that reminds us what great leaders do on a regular basis.

Select good people
Define clear expectations
Praise often, predictably, and immediately
Show they care

Selecting good people has been a mantra lately but it bears repeating. Hiring a good employee takes more time than hiring the "convenient" employee. Many managers claim they don't have time to hire because they have the opening now and can't wait. The irony in the "I don't have the time" approach is that it catches up to you in the end because of all the challenges presented with a miss-hire. Rather than taking the time to hire the right employee, managers will be spending their time trying to "change" the employee into the type of employee the manager wanted in the first place. Guess what, though, it's almost impossible to change a bad hire into an excellent hire.  The bottom line is hire the person for who they are and forget about trying to change him/her.

Almost every manager might claim that he/she has clear expectations for his/her employees. Unfortunately, though, research shows that less than 50% of the employees today have clear expectations. Some might rationalize this by the fast pace of change but that doesn't count. If that was the reason, we wouldn't find any performance excellence because everyone is living in a fast-paced world. Yet, we can find performance excellence all over the place because we find leaders who communicate clear expectations by meeting with their people often. Great leaders don't set goals once or twice a year, they do it multiple times a year.

The third basic skill observed by great leaders is praising their employees. Great leaders understand consequences make the difference. The worst kind of consequence is one that is uncertain, in the future, and focused on the negative. On the other hand, the best kind of consequence is recognizing positive behaviors with immediate praise.   Sustainable excellence, therefore, is rarely a one-time achievement but rather a result of repeated, incremental improvements. Great leaders notice the improvement and celebrate them. This frequent celebration encourages repeated positive performance.

The fourth and final skill recognized by great leaders is caring for their employees. I suspect some people might roll their eyes because this is one of those "warm and fuzzies" that's hard to quantify in organizations.    For those of you in that view, here's something to help you understand the quantifiable nature of "caring." Research draws a STRONG link that employees who feel cared about at work are...

missing fewer days of work
less likely to have accidents at work
less likely to file worker's comp claims
less likely to steal
less likely to quit
more likely to advocate the company to friends and family.

Reference: The One Thing You Need to Know, Marcus Buckingham, Free Press, 2005.

Finding the Right Levers

Tuesday, September 15, 2009 by John Latham

Finding the right levers in the organization requires a systems thinking approach in order to create sustainable excellence. While the desired outcome might be improved financial performance, focusing on the financials is like trying to play basketball while watching the scoreboard. The CEO of a company I used to work for described it like this. While money is critical to the organization's survival and it is the “life blood” of the organization, it is not the only reason the organization exists. Like a basketball team, the organization focused on how the "team" worked together to move the ball down the court and put the ball through the customer's “hoop” time after time. The more we put the ball through the hoop, the more satisfied the customers were, the more they requested our services (repeat business), and the more they told their friends about the organization (referral business). Consequently, the organization enjoyed exponential growth and financial success.

Achieving and sustaining high performance requires a systems thinking approach that identifies the right levers to achieve sustainable organization change and excellence.

Sustainability for Free, or Even Better

Monday, September 14, 2009 by Chad McAllister

Many years ago quality guru Philip Crosby created a movement that shared the title of a book he wrote in 1980 -- that quality is free. Is the same true for sustainability? An article in Chief Executive Officer prompted me to consider this again when it shared that MIT Sloan Professor Rick Locke said, "Sustainability is not a nice additional thing to do on top of your core business, but absolutely central to what a business does."

When I talk about sustainability, I am not speaking of green practices, but a balanced scorecard approach of success that creates an enduring organization. Elkington, Emerson, and Beloe (2006) call sustainability the triple bottom line -- financial, environmental, and societal. This is also being phrased as the 3 Ps: profit, planet, and people. Smart companies are being good stewards of all three areas:

pursuing profits because that creates a strong organization that can be responsible to the planet and people.
interacting with the environment in a way that creates a sustainable (long-term) business model -- often this can reduce costs and create sources for new profits.
treating people and communities with respect because these are current and future employees and customers.

We are seeing examples of sustainable transformations that have the potential to be recognized as quality has been -- to be free. Consider a dairy that is paying large sums to dispose of a cottage cheese by-product that could be refined into whey protein. Instead of an expense, a new business line can be constructed that turns a waste item into a profit center. Opportunities like this are much more common than we may think -- providing a lens to view sustainability as not only free but even profitable. This example shows that sustainable innovations don't have to be new-to-the-world product innovations -- we just need to look at problems from a different perspective.

Reference: Elkington, J., Emerson, J., & Beloe, S. (2006). The Value Palette: A Tool for Full Spectrum Strategy. California Management Review, 48(2), 6-28.