“It’s like a madhouse,” he explained.

“I turn up every day with great plans to get things done, and before I know it the day has passed me by and I’ve yet to get to any of the important stuff. It’s never-ending. No matter how late I work, even if I take stuff home, I still never seem to get on top of things. If someone asked me what I do every day, I’d say I was trying to eat an elephant. . .and getting nowehere.”

This was a friend of mine, a relatively senior manager, explaining to me his frustration at the fact that most of his time at work is devoted to urgent tasks but not necessarily important ones in terms of delivering on what he is supposed to achieve. We sat and talked about the issue over a pint or three and I could sense the stress this was causing him. Unfortunately, as is similar in all the cases I come across, there isn’t really any magic answers to the workload problem and part of the solution will always be improving personal time management skills, but that’s not the specific element I want to focus upon here.

The discussion with my friend got me focused again on that all too common clash that  occurs between what is urgent and what is important at work. Sometimes they overlap, but more often than not the pressing concerns are addressing immediate or short term problems without necessarily have any lasting long-term benefits. Of course, the urgent and the important both have to be managed but, sadly for most managers, 80% of their working day is often devoted to activities that couldn’t really be considered critical in terms of strategy execution, or other vital management responsibilities.

Here are some general thoughts which I think can help any manager faced with the elephant eating problem:

Narrow the Focus
Funnily enough, in terms of trying to improve the current situation, a useful starting point is often to step back and really consider what actually falls under the ‘important’ umbrella. In asking my friend the very same question, the list of activities he recounted to me in response was simply too long for it to be considered truly important. Not everything can be deemed important in my mind, and you should consider creating a new category – ‘imperative’ – which are those few things that take precedence over all else.

In my experience, all managers could benefit from narrowing the focus of what fits into the ‘imperative’ category. It is a proven fact – thanks to the law of diminishing returns -that the more goals you have the less likely you are to achieve them, because lack of focus equates to lack of effectiveness which in turn means you do a bit of what is required across many areas, but not enough to really make a difference. So, your first step has to be to define what your key goals are – define the imperative. This may require you sitting down with your boss, and yes that’s likely to be a tough discussion, but you have more chance of success if you don’t begin it with statements like “I can’t do all of this…” but instead open with something like “I could be more effective if…” At the end of the day, a business, department or individual that has too many goals, or too broad a description of what is important, is living in a fantasy world.

Plan back from the goals
Goals are of course only realised through focusing continuously on the specific actions necessary to progress towards them and it is during the whirlwind that is work-life for most people that the battle for effectiveness (in terms of achieving goals) is won or lost. A number of years ago I developed a tool called The Goal Achievement Framework which I use msyself and a number of managers have told me it has helped them in this regard.

To achieve your goals, you need to define the imperative activities and tasks that move you in the right direction and then you must be both efficient and effective in moving towards them. Efficiency and effectiveness are not the same thing. Efficiency comes from having some approach to planning, such as a diary, which you adhere to daily and as stated above, time management is always an important consideration in terms of achieving what you need to achieve. That said, being efficient is only part of the equation, as you can actually be efficient without ever achieving your goals. The following framework can help you:

This framework provides you with an easy to follow mechanism for working towards your goals and whilst it is nothing earth-shattering, it works well because you spend time defining priority goals from the start and subsequently plan the imperative activities required to achieve them. The framework also combines efficiency and effectiveness. You become more effective, as you start thinking first about your goals and are consciously moving towards them. You become more efficient, because you define the key activities and tasks that need to happen to reach your goals and enter them into your planning system to ensure they happen.

Shed the less important activities
This is an area that I have written about a number of times before, but I make no apology for rehashing old ground because I see delegation as being one of the critical issues in terms of management productivity. If I had a penny for every time I heard managers, and not only those at senior level, tell me that they “wished they could delegate more” I would be a very rich man indeed. And, apart from my own direct evidence, lack of, or poor delegation is a widespread concern in business life and is certainly a well-documented phenomenon and any number of studies show that delegation is a problem for many managers young and old. But as my friend acknowledged, there are only so many hours in a life, or so much patience in the wife, that in order to get time to focus on the imperatives, then you have to shed some of the less important tasks.

In my experience, there are a number of reasons why any particular manager won’t delegate, or does so poorly, and these can range from being a control freak to a lack of understanding as to what delegation actually entail. As a manager, you are accountable for others and there will be many duties and tasks that you will allocate to them in the normal course of the day. If these tasks fall within the remit of the employee in question then this is just part of your role as manager: if the employee has to do it, then it’s not delegation, it is allocation. The main concern in terms of how you allocate work is that you do so fairly, communicate your expectations effectively and ensure the employee has the necessary skills, knowledge and motivation to do the work in a manner that reaches your expectations. Most of what you do in terms of managing workload is actually allocation not delegation. At the other end of the scale are tasks that you should do – they are part of your remit – but you hate doing them, so you might fall into the trap of offloading them onto others. This is abdication and is not good practice, for obvious reasons.

Delegation lies somewhere in the middle. It involves passing an important task, which you are ultimately accountable for, to someone else. They don’t have to take it on board, but do so for a variety of reasons which may include that they are ambitious and want to learn, or that they are simply just talented and helpful. Of course, the only value from delegating arises if you use the time you free up from having to do that task to focus on something more important. In seeking to become a better delegator, consider the following points:

Analyse your job – what are the tasks that you could delegate to others and, if you did so, how could you use the time saved more efficiently to focus on imperatives?

Select the right person – not all employees want to be delegated to so you need to define the right person and ask them if they would like to take on the task. You cannot force them to do it, as it falls under your remit. By the way, pulling rank on someone or using your position to subtly intimidate an employee into accepting to take on what is in reality part of your workload is never a smart move in the long term and will usually come back to bite you.

Delegation is a process – you need to recognise that when you first delegate the task, you are likely to lose time not gain it. This is due to the fact that if it is an important and meaningful activity then you will have to spend time with the individual to train and coach them. As part of that, you need to communicate how to do it, explain the outcomes required and support them initially as they get to grips with it.

Delegate authority relevant to the job – if the task requires your employee to request support and assistance from others, it is important that you communicate to all concerned that you have delegated responsibility to them for this task; otherwise, he or she may be faced with difficulties when requesting that support.

Monitor and review but don’t micro-manage – as you remain accountable for the task, you will always follow up to make sure it has been completed to standard, but once you are confident that your employee is competent at it, don’t stand over his or her shoulder constantly – this means you haven’t actually delegated the task and will likely lead to them feeling frustrated or believing that you don’t trust them. It goes without saying that you should offer praise for a job well done.

Track your progress
Measurement is naturally a critical activity in terms of measuring progress towards your goals but too often the focus of measurement systems is on what could be called the ‘lagging’ measure – i.e. the end-result, without enough attention paid to the ‘leading’ measures – those which drive the outcomes seen. But if you think of it, by the time you get the lag measure at the end of any given period, it’s too late to do anything to change the outcome. It could be considered akin to trying to drive a car by only looking out of the rear-view mirror.

Think of a non-work example here. If you wanted to lose weight, standing on the scales at the end of each week will give you a result, but if you don’t like that outcome, there’s nothing you can do about it until the following week. It would be much better to continuously focus on lead measures such as ‘number of calories in-taken daily’ or ‘number of hours spent exercising’ – if you get those measures right during each day, then you will see the positive result at the end of a week because there is a direct correlation between those lead measures and the lagging result. So, as well as lag measures related to your goals, you must define what the lead measures are associated with them, and then focus your efforts on getting those lead results right on an on-going basis.

There is no easy answer to manage your way through the mire that is often daily work life, but shifting the emphasis even a little away from thinking of urgent-important to a focus on urgent-important-imperative then you can at least pinpoint those activities that cannot be ignored. 

During our chat my friend asked me did I know how to eat an elephant? Given that he had just downed his second drink, I went along with the odd question, and answered no.

“One bite at a time.” he said.

That’s a bit like what you have to do in terms of reaching your goals.

Enjoy your day!

I have a new book out in the coming weeks, entitled The Essential Manager, which may be of interest to you.

The book is:

Timely because it strips away all the hype and jargon that attached itself to management thinking during the boom years and returns the focus to the only thing that really matters in organisation life; results.
Relevant because it provides useful guidance across three dimensions that are known to drive those results, particularly in these difficult times: Personal Competence (About You), Employee Engagement (About Employees) and Strategic and Operational effectiveness (About Business).
Targeted because it focuses upon 30 management priorities across these three dimensions.
Beneficial because it is solidly research-based, emphasises the practical application of that theory, and provides support that can be applied across industry sectors and fields.
Unique because it does not separate the leadership and management functions but rather argues that one without the other is akin to trying to tie your shoelaces with one hand.
Attractive because it is written in an engaging style which helps to translate important concepts and messages into user-friendly and readable terms.

“The brain (that’s the senior management in your business) thinks and selects options, and the body (that’s everybody else) follows the brain’s instructions. Successful strategy is made up of two distinct elements: the thinking by the brain, and the execution through the body.”

As I listened, it was as if I had stepped back in time. But I hadn’t. This well-known speaker was actually saying these words. After the talk, I raised my hand and when given the opportunity, I asked him whether he didn’t think that it was somewhat dangerous to separate ‘thinking’ from ‘doing’ in any scenario, but particularly so in the context of strategic management? I got an answer from him, but one that had nothing to do with my question.

Recently I wrote a post entitled “Nobody really knows what strategy is” which was based upon a quote in The Economist. The purpose of the article was not to argue that companies didn’t have strategies, but rather to make the case that the ‘strategic management’ process in most companies is so shrouded in complexity that it is confusing to the majority of managers; and employees are generally complete bystanders in the process. Defining a winning strategy for your business is of course never easy, but the process followed to arrive at your strategy doesn’t have to be so complicated that few people actually understand what’s involved. The article seemed to strike a nerve and I received quite a few emails and comments in response, both in favour and against some of the points in the piece. A number of those who did get in touch also posed a useful question, What Next? Or in other words, when the strategy has been agreed, what happens next? And that’s what I’d like to focus upon today.

The first point I would make here is that strategy should never be seen as a baton that’s carried by a few for a while, before being passed off to others at a later stage. Sure, people will play different roles in the strategic management process, but separating strategy formulation from strategy execution is fatal, I believe, if only for the message it sends out; i.e. certain people in this business ‘think’, and others get paid to ‘do’. Strategic management is a process that should involve everyone in the organisation in some way, appropriate to their level of course. Yes, it will be senior managers who ultimately define the strategy, but doing so without any input from the wider management team, and indeed employees, is to potentially miss out on the many great ideas floating around any business. In turn, executing that strategy cannot solely be the responsibility of  drone-like ‘implementers’ who simply do what they’re told, or follow a path set for them by others.

It is this dividing up of strategic management into formulation (thinking) and execution (doing) components which is a major contributor to the fact that strategic management fails in many organisations. And fail it does, particularly when it comes to the execution side of things. By all accounts, success rates at strategy execution are pretty poor and various research plots the failure rates as being worryingly high. Robert Kaplan and David Norton – of the balanced scorecard fame – have commented that, “Organizations often fail at strategy execution. Various sources have reported implementation failure rates at between 60 and 90 percent.” In another article published in Forbes magazine, a survey showed that while 82% of Fortune 500 CEO’s felt their organisation did an effective job of strategic planning, only 14% of the same CEO’s indicated that their organisation did an effective job of implementing the strategy.

Now, the failure of strategy execution does not mean that managers across organisations are sitting idly by doing very little every day, they may well be working extremely hard but in terms of ‘doing the right things’ to realise strategic goals they may not be suitability focused in their efforts – and that’s hardly surprising given that in many case they feel no affinity to the startegy since they have been been left out of the loop during its development.

Making strategy happen does of course require consideration of a variety of issues and in no order of importance here are some key points to reflect upon:

Involve one and all

Again I emphasise that it is the defined role of senior management to make decisions around the goals and strategy to be followed, but as part of the decision-making process, all employees should be involved in some way. After all, front-line employees can deliver great insights into customers’ needs and expectations which can feed into strategic decision-making. And don’t for a minute imagine that the wider body of employees don’t care about where the business is headed; in my experience, it does matter to the majority and what’s more they do have a valuable contribution to make.

Bring it to life

Once formulated, a strategy, or a series of interlinked strategies, that remain known and understood by a limited few in the organisation have little chance of success. All employees need to know the outcome of their input, so if you involved them in the development phase, they naturally will be keen to know what the results have been. Think of it this way, if someone loaded you onto a bus but refused to tell you where it was headed, you’d be bothered by that. Think how frustrating it must be if you work for an enterprise but haven’t a clue where it is headed? I again emphasise that they don’t need to know every single detail, but certainly they must understand the big picture, and more importantly how they can contribute to achieving it.

A second consideration is important here. In my experience, employees also need to better understand the dynamics of the business they work in. This may sound like an obvious point but here is a simple example of what I mean. Often, when interacting with employees in a business, I ask them a simple question, namely ‘for every €100 in sales in this company, how much of that translates into profit?’ It’s amazing the answers I get, which usually range between €60-80. Now, I am not suggesting that your employees need to become financial experts but they do need to better understand how the business works generally and what the consequences of their actions are.

Lead to succeed

Strategic management requires leadership and unless the leaders within a business, at all levels, constantly focus upon the strategic goals, then clearly nobody else in the business will. Every discussion, decision taken, or action implemented must happen within the context of the strategic goals and where that occurs, strategy becomes a meaningful part of the day-to-day life. Where strategy is only discussed periodically, or at formal reviews, then there isn’t really a strategy at all, just a mistaken belief that there is one.

Resources

An under-resourced strategy is a wish list, nothing more, and when looking to the medium term you need to consider the financial, information and talent resources that you require in order to bring your strategy to life. This is often a shortcoming in the strategic management framework in organisations as they aspire to achieve great things but they do not underpin those aims with the necessary resources. For example, one company I worked with had great plans in terms of developing new markets for their existing products, but when push came to shove they didn’t have the necessary marketing competences in place internally, nor did they invest the required resources in marketing activities to actually realise their plans. Yet, they continued to hold to the belief that they were pursuing a ‘market development strategy’ – no, that was just an aspiration.

Trickle down planning

Generally, strategy formulation leads to the agreement of goals and the mapping of a route towards those goals in what could be called ‘broad brush stroke’ terms. This is fine, but that general direction for the business must then be translated into more concrete actions. This particularly happens through the annual business plan which defines the actions necessary in any given year to move the business towards the stated goals. Again, there is nothing new or indeed challenging in that in principle, but I have frequently seen that even where strategic planning does occur, the annual plan (with its focus on the short term) can be at odds with what is required to actually achieve the strategy.

Pimp your processes

Your annual plan is then rolled out through your key processes including things like production, sales, finance and so on. Additionaly, you also have cross-functional process such as IT, innovation, HR and so on which all contribute in some way to making your strategy happen. As part of strategic management, you need to ensure that all process are effective as they can be and this is where having some form of business excellence framework in place is vital – if each individual process is operating to the optimum, then that is naturally going to help you achieve your strategic goals.

Monitoring progress

I have highlighted many times before the need to measure both implementation (are we doing what needs to be done?) and impact (are those actions taking us where we want to go?) in order to ensure that the business is moving in the right direction. And where strategic management is concerned, it is the measuring of impact which provides the data required to help strategy evolve and adjust to changing circumstances. Without the right information here, strategic management becomes a static process which quickly loses ivalue as circumstances outpace it.

To close today’s post, in seeking to better manage the strategic management process in your business, you should begin by asking yourself how you view the process itself. Is it seen as having separate components that are only relevant to differing groups of people, or is it seen as a fluid, meaningful and integrated activity, which evolves and improves and is, in some way, the concern of everyone in the business? Where your answer is the former, then you are approaching the issue of strategic management in a manner akin to trying to tie your shoelace with one hand. It can’t be done, or at least not very effectively.

Enjoy your day!

“Watch this,” he said.

I looked on as the elderly man and woman approached the counter.

Two teas and a current bun, please.

“Same thing every day,” he said to me. “The total will come to €5.10, just over my minimum spend requirement of €2.50 per person during lunch hour. Every single day they come in, buy the exact same thing, and if available, sit at that table over there in the corner for ages which means that people who do, or could, spend a lot more can’t get a seat. I know why I’ll never be rich because I haven’t the heart to tell them to p**s off somewhere else, but they cost me far more than their worth.”

This is not an unusual problem I find, and not just in the hospitality industry either. I once had a guy who runs a web hosting business tell me that they actually got rid of their ten ‘lowest value’ customers because, having done some analysis, they found that those who had the cheapest price hosting packages were actually the ones who used the helpline most frequently. And that wasn’t the only step taken, he explained. Over time, they changed the business model so that a direct helpline was only available to those on higher cost packages, and for the lower value options, all support was offered solely online – primarily through FAQs and a text-based enquiry service which gets answered when his techies have time.

This idea of ‘customer value management’ is hardly new, but the little old couple incident which I recently experienced when I popped in to see a friend who runs a coffee shop got me thinking about the issue again. And when you look at the various research and opinions on this matter, you will find a mix of views both for and against the ‘firing’ of low value customers; those for will argue that you don’t run a charity, so you have to be hard-headed about these things, and those against say that you should instead try to transform the low value customer into a higher value one, or use a variety of techniques and incentives to get them to change their behaviour and spending patterns. It all depends upon what business you are in I suppose – a faceless low value customer online or at the end of the phone is probably easier to ‘fire’ than two people who “remind me of my parents” as my friend described it.

As a sort of funny aside here, and focusing on that recommendation of attempting to change the behaviour of the low value customer through incentives etc., I actually suggested to my friend that he should offer the old couple a special price if they say came a bit earlier in the morning, or later in the afternoon instead. He threw his eyes to heaven and laughed before I had even finished the sentence. He had tried that last year, he said. Then the couple told all their friends at Bingo night that he was offering the best ‘tea and bun’ price in town and for weeks after he was swamped with seniors in mid-morning, which wasn’t quite the image he was going for. Anyway, as he said himself, “I’ll probably get my reward in heaven, but I’ll remain broke here on Earth.”

Now, in today’s post I am not really going to attempt to offer you advice about customer value management, or specifically what you should do with those you consider to be your low-value customers, but I am going to suggest that it’s something you, and your management team, should spend time focusing upon. My guess is, and especially if you operate within the SME sector, that you will naturally be aware of the ‘mix’ of customers you have, in terms of their value to you, but you may not have fully considered how best to tailor your customer experience to fit the different value profiles within your client base. So, the focus here is more on Customer Experience Management, or CEX as the trendies now call it, and less on what to do or not to do with those you consider add little value to your business.

Where are we now?

As with any issue, reflection is important and analysing the current situation is a always the appropriate starting point. To give you something to ponder on this matter, you could develop a simple matrix based on two dimensions: the spend/value of a customer, versus their loyalty level. Alternatively, you could have the spend/value of customers plotted against their satisfaction levels, or frequency of visit/usage.  The reason I prefer ‘loyalty’ as one axis is because research shows there’s actually little correlation between ‘satisfaction’ and consumer loyalty. For example, one study by Bain & Co. found that “80% of consumers who defect to competitors score themselves as ‘satisfied’ or ‘very satisfied’ on surveys – just before they jump ship.” (1).

In this case, my choice of dimensions results in the following simple matrix populated by some general customer profiles:

Of course, this is a somewhat simplistic analysis and within each of those windows there are different degrees of customers too, but as a thought-provoker it works fine. The categories of customer can be summed up as follows:

Dead Weight – these are customers who add little value yet take up a lot of your time and resources in a variety ways; they frequently seem to be moaning about something too, so you end up devoting an inordinate amount of time keeping them happy for little return. You might wonder why they don’t go elsewhere but given their low propensity to spend, it’s not like your competitors are attempting to poach them off you.

Blockers – there are a range of customers within this segment. On occasion, like our elderly couple from earlier, there is a type of customer here who clearly likes you, returns again and again, but they spend little, and most importantly, may not have the desire or capacity to change that. However, there can be other current users of your products/services who again like what you do, only spend a small amount at present, but with information, or upselling, you could generate additional revenue from them because they have the capacity to spend more. In either case, they are at present ’blockers’ in the sense that they use up time and resources that could be devoted to other more profitable segments.

Red Flags – these customers are, of course, a major concern for any business because they might appear satisfied but they may not actually be as loyal to you as you think; often, they are open to offers from the competitors. And, the fact that they are potentially high value, means they are likely to get plenty such offers too.

Money Makers –  naturally, those who fall into this category are worth their weight in gold and as always in any business it will be a relatively small proportion of your clients who generate greatest returns for you.

Whatever matrix design you use, the purpose is to stimulate discussion on this issue between you and your management team and/or employees. The next question is of course what are you doing, or could you do, to tailor the customer experience for each category and indeed the degrees of customers within each of those categories. A simple consideration here is to talk through the customer journey and identify ways in which the service experience is different for your high value customer versus the low value one. Let me give you a simple example.

I travel a lot for my work and in doing so there is one hotel I use quite frequently for its convenience, and have done so for over ten years. I would consider myself to be of reasonable value to this property. Yet, to make a telephone reservation, I go through the same process as everyone else which unfortunately often involves being left on hold, or having to repeat my details even though they must have them on file by now. Okay, I’m not necessarily looking for a special ‘bat phone’ number to call but I simply use this as one example of where my value to the business isn’t really reflected in the experience I get. These types of practical examples are useful discussions to have with your people I find.

Suits you sir!

There isn’t a step-by-step approach to tailoring your customer experience because naturally it depends upon what it is you do and the scale you do it at, but here are some general observations based upon the different forms of interactions you have with customers:

Web/app-based interactions: for all customers the ability to interact with you in their own way, at their own time is vital and it goes without saying that you should ensure that such interactions are as smooth as possible through technological platforms that are user-friendly and up-to-date etc. But ask yourself this: if an existing low and high value customer use your site to make a query, or to make a purchase of some kind, have you any way of identifying them at present; and if you can, how is their experience then tailored as a result?

Human interactions: by this I mean all the potential service interactions that a customer can have from initial contact to after-sales service. If I spend €100 in your business over the course of a single interaction versus someone spending €1000, how is the service experience differentiated between us at present. Every client should experience a minimum level of service quality, but clearly the greater the spend, the more differentiated that experience should be.

Product interactions: this is probably the easiest aspect of your offering to tailor as you would expect that a higher spend leads to access to enhanced products of various kinds.

Does it matter?

The final part of the jigsaw here is that, over time as you enhance the customer experience based on the value someone brings to your business, you want to be sure that such additions and enhancements are actually making a real difference. And to do that, you need to be sure that your feedback and measurement systems are giving you the information you need. Do they target the appropriate proportion of high value customers so that you can be assured that you are hearing from, and learning about, their issues and concerns? Or are you hearing most from the customers that generate the lowest returns?

The purpose of today’s post was to raise questions as much as it was to provide answers. The issue of personalisation of the customer experience, which certainly is not new, is increasing in importance as companies fight to find and retain those segments that can produce the greatest return on investment; and these principles apply whether you run a multi-national or a mom-and-pop operation. Yes, all customers are equal to a point, but when it comes to helping maximise the profitability of your business, some are definitely more equal than others.

Enjoy your day!

(1) Blasberg, Vishwanath and Allen, “Turning Your Consumers into Die-Hard Fans”, at http://www.bain.com/publications/articles/turning-your-consumers-into-die-hard-fans.aspx.

Once upon a time, there lived six blind men in a village.
One day the villagers told them, “Hey, there is an elephant in the village today.”
They had no idea what an elephant is. They decided, “Even though we would not be able to see it, let us go and feel it anyway.” All of them went where the elephant was. Every one of them touched the elephant.
“Hey, the elephant is a pillar,” said the first man who touched his leg.
“Oh, no! it is like a rope,” said the second man who touched the tail.
“Oh, no! it is like a thick branch of a tree,” said the third man who touched the trunk of the elephant.
“It is like a big hand fan” said the fourth man who touched the ear of the elephant.
“It is like a huge wall,” said the fifth man who touched the belly of the elephant.
“It is like a solid pipe,” Said the sixth man who touched the tusk of the elephant.
They began to argue about the elephant and every one of them insisted that he was right. It looked like they were getting agitated. A wise man was passing by and he saw this. He stopped and asked them, “What is the matter?” They said, “We cannot agree to what the elephant is like.” Each one of them told what he thought the elephant to be. The wise man calmly explained to them, “All of you are right. The reason every one of you is telling it differently because each one of you touched the different part of the elephant. So, actually the elephant has all those features what you all said.”
“Oh!” everyone said. There was no more fight. They felt happy that they were all right. (1)

Okay, he’s bloody well banging on about elephants now I can hear you all saying, but bear with me, there is a point to this introduction. And it strangely has to do with two important questions, namely: What is Strategy? and What is your company’s strategy?

Taking the first question, if you were to ask ten ‘experts’ about strategy you would probably get eleven different answers at least. In fact, the more I research and learn about the subject of strategy, the less I feel I actually know. It’s so damn confusing, or at least with such a variety of views on the matter, it can be head-wrecking if you let it. As to the second question, when I work within companies and deal with senior managers, I always ask them to summarise their strategy in a short sentence or two, and in that context too it’s amazing how many different responses I get.

In fact, getting answers on the topic of strategy, at a number of levels, canat times feel a bit like you’re listening to blind men describing elephants . So much so that the The Economist once opined: “Nobody really knows what strategy is…”

Stciking with elephants for a moment, in his famous book, ‘Strategy Safari: A Guided Tour through the Wilds of Strategic Management’ Henry Mintzberg too begins with a poem about blind men and elephants upon which my introduction parable was based and then he followed it up with this classic observation:

“We (the strategy makers) are the blind people and strategy formation is our elephant. Since no one has had the vision to see the entire beast, everyone has grabbed hold of some part or the other and ‘railed on in utter ignorance’ about the rest. We certainly do not get an elephant by adding its parts. An elephant is more than that. Yet to comprehend the whole we also need to understand the parts”

In the book he also defined Ten Schools of Thought in relation to strategic management as being:

1. The Design School: views strategy formation as a process of conception
2. The Planning School: views strategy formation as a formal process
3. The Positioning School: views strategy formation as an analytical process
4. The Entrepreneurial School: views strategy formation as a visionary process
5. The Cognitive School: views strategy formation as a mental process
6. The Learning School: views strategy formation as an emergent process
7. The Power School: views strategy formation as a process of negotiation
8. The Cultural School: views strategy formation as a collective process
9. The Environmental School: views strategy formation as a reactive process
10. The Configuration School: views strategy formation as a process of transformation

These schools, Mintzberg argued, have appeared at different stages in the development of strategic management. In seeking to better understand strategic management I think it’s useful to recognise that, today, it is actually an amalgam of elements of all these schools. It requires aspects of all of the above: it must be a process, there’s an analytical component to it, as well as a visionary element, it requires thinking, negotiating and so on. Strategic management is therefore undoubtedly a big undertaking, but no so big as to warrant the hype and confusion that surrounds it.

So, in more simple terms, actually devising and implementing a strategy for your business requires you to do three simple things:

Think – about where you are now and where you want to be as a business? You need to understand your current position based on fact, not opinion.
Do – take steps to get you to where you want to go.
Review – continuously monitor progress so that you know how you are doing on the journey.

This process doesn’t have a beginning, middle and end but is rather is an evolving activity which should guide everything that happens in your business. For example, if you develop a new product or service, there should be a clear rationale as to how that particular effort is contributing to the achievement of your strategic goals. Strategy should not be something that’s discussed at ‘special events’, weekend retreats and the like; instead it must be alive within the business all the times, not wheeled out on occasion, or every now and again. It must be the true guiding force for everything you do, a direction which everyone understands and contributes too. Of course, there are any number of models out there on strategic management but I now use a 6 M Framework with my clients to help them work through the process in a less intimidating way. These areas can help to guide discussions around strategy.

1. Meaning
When working with companies on strategic management I often begin our interactions by asking three very simple questions. The first is What do you do? in this business and in all cases the answers tend to flow easily: “we do this, that and the other.” I follow up with the second query which is How do you do it? which again poses few challenges to those sitting around the table, other than they often look at me as if I am a bit thick, but they can quickly tell me all about their great systems and procedures. My final question is always Why do you do it? and for some reason there is usually a slight pause before the answer comes out, which is generally something along the lines of “to make a profit (stupid)”, with the ‘stupid’ being silent and inferred. But, in response, I always point out that profit is a worthy and desirable outcome from any business activity but it does not constitute a truly meaningful rationale for it.

In his highly regarded book, ‘Purpose: The Starting Point of Great Companies’, Nikos Mourkogiannis highlights that successful companies define ‘purpose’ in four ways:
• Discovery (Searching for the new and innovative),
• Excellence (A passion for delivering excellence across all activities)
• Altruism (Doing business in a way that enhances life for stakeholders)
• Heroism (Achieving something outstanding)

I think these headings can form nice parameters in terms of helping map out the ‘purpose’ of any enterprise and those sentiments can then be captured through the development of Vision and Mission statements. I have written extensively on these statements before but Vision succinctly captures what you are ultimately trying to achieve as a business, whereas Mission outlines what kind of company you will operate as you work towards that vision and makes commitments to key stakeholders such as owners/investors, customers, employees and the wider community.

And does having a defined, and shared, purpose really make a difference? Well, gut feeling (and my direct experience) tells me that having a purpose – which gives real meaning to those working in an enterprise – can only but have a positive impact, although no doubt you’d like to see some hard facts on this issue. Of course it’s always difficult to differentiate between correlation and causation on these matters but one study undertaken between Burson-Marsteller, a leading global public relations and communications firm, and IMD Switzerland, one of the world’s top business schools, found that “a strong, strategically coherent and well communicated corporate purpose is associated with up to 17 % of better financial performance and builds trust with stakeholders.” (2)

My own experience has convinced me that meaningful vision and mission statements do add value but that value primarily comes from the engagement benefits that arise by including your people in the process of defining a shared meaning for the business – people feel part of something as a result and that is what drives enhanced engagement and productivity levels.

2. Method
Here I mean ‘method’ in the context of how you set about achieving your vision and mission, or fulfilling your purpose in other words. A lot of companies develop vision and mission but do little else with them but to add any real value to the strategic management process these statements must be translated into specific and measurable goals which are targeted at the medium to long term. It is through the process of defining strategic goals that you begin to translate purpose into action. Such goals might include:

• Management Goals – financial targets, and other non-financial goals; for example, in relation to quality, environmental management, hygiene & safety.
• Customer – targets in relation to customer satisfaction, loyalty, retention, market share etc.
• Employee – goals in relation to employee satisfaction, turnover, productivity etc.

The ‘strategy’ part is then concerned with defining how you are going to realise those goals. It’s concerned with moving from the current position to the desired destination and, in doing so, you are trying to differentiate yourself from the competition and create lasting competitive advantage for the business. Following the herd is not a strategy; in fact, it’s evidence of a lack of one amongst all the followers.

Your strategy, or more likely your series of interlinked strategies will depend upon your own circumstances (i.e. where you are versus where you want to be) but in helping you to stimulate discussion as to what your strategy could entail, the famous professor Michael Porter once defined generic strategies which can serve as a useful thought provoker when you are focusing on this issue. These were:

Cost Leadership - seeking to gain competitive advantage by either increasing your profits through reducing your cost base whilst charging industry-average prices, or through increasing market share by charging lower prices, but still being able to make a decent margin on unit sales due to your lower costs.
Differentiation – means trying to gain competitive advantage by making your products or services different from and more attractive than those of your competitors.
Focus or niche – involves trying to gain competitive advantage by focusing on particular niche markets and, by understanding the dynamics of that market and the unique needs of customers within it, develop uniquely low cost or well-specified products for the market. (3)

I find that these generic strategies can still be useful staring points when seeking to explore your strategic options.

Even when you agree a strategy, you still need to implement it and that in part requires you to develop integrated plans on an annual basis which combine the financial, marketing, HR and operational measures to be addressed in any given year to execute the strategy and progress the business towards the goals. For sure, every enterprise plans to some degree, but often the greater focus is on operational planning, which is vital, but it is not the same as annual planning. Planning has two dimensions: operational planning so that you ‘do things right’ and annual planning so that you ‘do the right things’ to achieve your goals.

3. Marketing
When formulating and implementing strategy and plans, you cannot ignore the importance of marketing and anything you do in this area must be aligned with your overall strategic direction for the business. Whilst I am far from a marketing expert, I think that the Ansoff Matrix which has been around a long time at this point provides a very useful framework for guiding your discussions in this area. As a reminder, here are the main elements of the matrix:

The matrix results in the following marketing options:

Market penetration – This involves increasing market share within existing market segments. This can be achieved by selling more products/services to established customers or by finding new customers within existing markets.

Product development – This involves developing new products for existing markets. Product development involves thinking about how new products can meet customer needs more closely and outperform the products of competitors.

Market development – This strategy entails finding new markets for existing products. Market research and further segmentation of markets helps to identify new groups of customers.

Diversification – This involves moving new products into new markets at the same time. It is the most risky strategy. The more an organisation moves away from what it has done in the past the more uncertainties are created. However, if existing activities are threatened, diversification helps to spread risk.

4. Money

Clearly, another important consideration in the strategic management process is finance, but specifically the funding issue: without adequate financial resources to support their implementation, your strategies and plans are in reality only wish lists. Financing your strategy means ensuring you have the right level of capital and current finance available, as well as the right type: i.e. most businesses naturally use a variety of financing sources and depending upon your business this will involve a mix of debt and equity. The balance has to be right.

5. Manpower

Even with a potentially winning strategy, and great plans, you still need to execute them and that, amongst other things, requires great people at both management and employee level. Considerations here include leadership quality, employee engagement and whether your people have the right competences to deliver what’s required. In any business, people can always give you an edge.

6. Monitor

As the old saying goes, you cannot manage what isn’t measured so you need to continuously monitor progress towards your strategic goals and this involves measuring implementation (is execution happening?) and impact (what’s the results?) More broadly, in a well-known article entitles ‘Evaluating Business Strategy’ Richard Rumelt of UCLA defined four characteristics for evaluating business strategy which I think can work well as a guide to make you think generally about how effective your strategy is once implemented. These included:

• Consistency: The strategy must not present mutually inconsistent goals and policies.
• Consonance: The strategy must represent an adaptive response to the environment and the critical changes occurring within it.
• Advantage: The strategy must provide for the creation and/or maintenance of a competitive advantage in the selected area of activity
• Feasibility: The strategy must neither overtax valuable resources nor create unresolvable sub problems.

Okay, I probably overdid it with the M’s today but I find this an easier way to communicate the key elements of strategic management in terms that are a bit more user-friendly than heavy theories or models. I don’t pretend this is the perfect answer on this issue but what it can do is help your managers to get a collective sense as to what’s involved, or in other words it captures all the important parts of the strategic management elephant.

Strategic management is clearly one of the most important aspects of what you must consider in terms of building a great business, so you certainly can’t ignore the topic and my recommendation is never to get too hung up on describing precisely what it is, but rather to develop an approach to strategic management that is based on best practice principles and one which works for you. And so what if it doesn’t have all the bells and whistles on it that some of the experts say it should have? The only issue that really matters is whether it delivers what you need it to in terms of helping your business to grow and develop and that everyone in your business knows what your strategy is.

Enjoy your day!

(1) http://www.jainworld.com/literature/story25.htm

(2) IMD/Burson-Marsteller Corporate Purpose Impact Study – http://burson-marsteller.eu/2010/09/imdburson-marsteller-corporate-purpose-impact-study/

(3) Competitive Advantage: Creating and Sustaining Superior Performance. Michael E. Porter. Free Press 1998

“You have to push. No one works as hard as they can all the time. It’s just not human nature. A lot of people mix things up…they say, ‘I’m not having fun’ … well, practice is not fun, I mean, it can be satisfying , but when you are running for two and a half hours and someone is on at you to go harder, play better, and smarter, uhm, I don’t think you can characterise that as fun …”

This is a paraphrased response given by Jim Boeheim, the legendary coach of the Syracuse University Basketball team, when he was asked how hard he pushed his players. Like all coaches, he has some great insights to offer on leadership and related matters, but he also makes the very valid point that an important part of any manager’s role is to push for maximum performance from each and every individual.

‘Pushing’ for best performance in the workplace has never been more important, but it can be perceived in a negative light by some, and just as basketball players sometimes don’t like being asked to give more, the same applies to employees. But of course it’s how you set about the ‘pushing’ which is the real issue here; old-style approaches which are concerned only with ‘task’ won’t get you very far these days but even when you do all the right things, you will still get a bit of resistance from some, but that’s just a fact of life for managers.

I was reminded of the importance of getting the most from your employees by a little incident that happened last week. Let me explain. On Friday evening, about 9pm, I was taking a bus out of the city and there were two guys in the seat just in front of me, obviously on their way home from work, and judging by their raised voices, having made a pit stop for a pint or two on the way. At one stage, the guy on the outside seat said to the other, “You know, I just totally goofed off today…I spent most of the time pretending to type away, but I actually did nothing…” They had a good laugh at that, and why not I suppose, it was Friday.

But from a management perspective, such instances –and they are far from  isolated in my experience – are problematic for a whole host of reasons, not least of which is the negative impact on productivity. In any business, the reality is that employees will always have some amount of down-time (or a ‘mental health moment’ as one employee described it to me) and that’s not necessarily fatal,  if for the most part they are achieving results which stretch them and are doing the very best they can most of the time. But, as you well know, this is not always the case, and particularly in small and medium sized enterprises, I find that the measurement of employee performance can still be a bit haphazard at times. Looking busy can still pass for being productive.

So, ask yourself a simple question. Are you getting the best performance possible from all your people? Consistently? Week-in-week-out? Likely you will find some room for improvement here so I thought it might be useful to provide you with some food for thought on the issue of ‘pushing’ for greater effort without of course applying a ‘white coat and clipboard’ approach which would likely reduce performance and productivity not raise them.

Naturally, the surest route to getting the most from your employees is to ensure that they are as engaged and motivated as possible and that of course brings into play a range of issues such as culture, leadership, drivers of engagement, rewards and recognition all of which I have written about previously. But even with the necessary focus on the ‘people’ side of the equation, as a manager you always have to consider ‘task’ too and as a consequence employee performance has to be managed, so that every employee is working towards some form of specific targets, and achievement of those targets needs to be closely monitored.

There are of course any number of comprehensive performance management systems out there and if you have already integrated something of that nature into your business, then your main focus today when reflecting upon the issue is to consider how well the system is delivering for you at present. If you don’t have a structured approach, or formal system, it doesn’t necessarily have to be a costly undertaking to remedy that gap, and when you think of the application of such systems from a cost-benefit perspective you’ll find the returns warrant the investment. Whatever model you have, or may adopt, there are some commonsense principles that need to be applied to performance management and that will be my focus today.

First off, when you think of it, you want your employees to perform certain tasks (the how) in order to achieve specific results (the what) and any performance management system needs to ensure that both the ‘doing’ and the ‘outcomes’ are as required. This requires you to consider a range of questions:

• What results should each employee achieve?
• In working towards those results, what processes, procedures and quality considerations are important?
• What assistance and development will be available to help them reach expectations?
• How will performance be measured?
• How will feedback be provided?
• How will positive performance be rewarded and underperformance addressed?

1. What results should each employee achieve?

You cannot measure an employee’s performance if they aren’t clear as to what is expected of them in the first place so clarifying roles, responsibilities and outcomes for each employee is a key step here. Tools like job descriptions are important in this, but there should also be key result areas defined for employees (linked to broader business goals and targets) with appropriate concrete measures agreed which can track their progress and performance. In terms of defining and assigning individual targets and measures, a number of considerations come to mind:

Validity - you must ensure that the measures are based on the key skills and responsibilities of the individual’s job, and appropriate in terms of their job description. In addition, they should ‘filter down’ from, and support, the broader business goals.

Measurability – you need to ensure that any expected outcomes are defined in such a ways as to make them measurable i.e. Apply the SMART principle to them.

Acceptability – this relates to how employees view the measures; do they accept them as valid and appropriate? This does not mean that you allow the ‘tail to wag the dog here’ but if an employee does not agree with a measure, or fails to understand its merit, they are unlikely to give their all to achieving it. That’s why it’s vital to ensure that what is expected of employees, and how that will be measured, is fully communicated as part of recruitment.

2. In working towards those results, what processes, procedures and quality considerations are important?

As well as the specific outcomes you want, there will naturally be right and wrong ways of doing things and achieving a certain target without caring for the ‘how’ is at best a short term gain. Therefore you need to have defined procedures and standards in place – without going overboard on paperwork of course – which provide clear guidance as to how things should be done. There should be no ambiguity as to the levels of quality required.

3. What assistance and development will be available to help them reach expectations?

Clearly you cannot expect top performance without providing development and support to your employees so that they have the required skills and knowledge which gives them a fair chance of living up to your expectations. That said, it is not unusual today to see companies raising the bar in terms of what they are demanding from employees whilst at the same time cutting back on the training and development opportunities offered. This is understandable in some respects, but if you think about it in purely objective terms, it’s a crazy situation.

4. How will performance be measured?

As with any aspect of measurement, you will need some process to facilitate the gathering of the required data; the nature and complexity of the measurement system will depend upon what you are hoping to monitor, the size of your business and so on but many small business owners and managers fall down here as they get the data they need too late, or too infrequently, to support effective performance measurement. In terms of measuring how the work is carried out, the importance of supervision should also not be overlooked. This is undoubtedly a really obvious (and basic) point, but I am seeing an emerging dilemma in this regard in many companies. For example, as well as employee layoffs, recent years have seen a streamlining of management layers in many companies with the result that those left are often under severe pressure just to manage their own workload, which does not facilitate the effective supervision of the work of others.

5. How will feedback be provided?

Not much to say here other than the fact that feedback should be regular and ongoing, and in addition, there should be periodic structured job chats and appraisals to provide for a more holistic and intensive review of performance. Again, hard to argue against this, but given the previous point, I am finding that many managers either don’t have the time to provide appraisals these days, or when forced to do so, cannot give them sufficient attention and focus.

6. How will positive performance be rewarded and underperformance addressed?

Finally for today, in terms of getting the most from your employees you need to be very clear as to how they will be recognised and rewarded when they do achieve and exceed expectations; and those returns have to have some value and meaning for the employee in question. Equally, when an employee fails to deliver, there must be consequences, for to allow underperformance to go unchallenged will cause disgruntlement amongst those who are making the effort, which in turn will drag down their performance.

Now, I don’t pretend that there is much new in today’s post, that wasn’t the intention, but the issue of managing employee performance has never been more important. Yet, for reasons outlined above, getting the most from employees these days is challenging, not least because managers themselves are generally swamped and haven’t the time to devote as much attention to this area as warranted. But, regardless of the challenges presented, as Peter Drucker once said, “The productivity of work is not the responsibility of the worker but of the manager.”

Enjoy your day!

“The dogmas of the quiet past, are inadequate to the stormy present. The occasion is piled high with difficulty, and we must rise — with the occasion. As our case is new, so we must think anew, and act anew.”

— Abraham Lincoln

I like this quote taken from a speech given to Congress by Abraham Lincoln. Although the time and context were naturally very different, I think his words could just as easily be applied to the world of work today – and indeed to any number of aspects of work life. It is not an exaggeration to say that we must look again at everything we do with a view to changing and improving on them where necessary and beneficial. The above quote came to mind last week as I was talking to a business owner on the issue of management development, and here is a synopsis of what the discussion entailed.

He had explained to me that, like most businesses, for the past few years he had invested little or nothing in management development. Whatever about the rights and wrongs of that decision, he said, the funds simply weren’t there to develop his management team, other than what he and other senior managers tried to do through an informal mentoring process. However, towards the end of last year, the company had secured a number of contracts which meant the future was looking a bit brighter, and as a consequence, he decided the time was right to offer a development programme for his management team. An outside company were contracted, a worthwhile training needs analysis was undertaken and a programme was agreed which contained modules applicable to all, as well as specific sessions relevant to different managers depending upon their level and role. In total, six days training were offered to all over a period of a six weeks or so. The feedback, he said, was good from those who attended: no complaints with either the content or delivery.

Yet, several months after the programme had taken place, he was very concerned that there was little practical change happening on the ground. His direct investment of €10,000 (not including the costs of taking managers away from work to attend the course) had certainly produced a largely positive reaction from his team, and that was welcome, but he couldn’t really see any lasting impact – or as he said himself ‘nothing dramatic” had happened as a result.

This chat got me thinking about a few issues in relation to not just management development but to training in general. The first point is that – and admittedly there is nothing new here – measuring the impact of training is inherently difficult. The second is that perhaps we need to completely overhaul how we view, and then deliver, training in the workplace, and especially so in relation to management development. Okay, I accept that this may not be the most exciting of subjects, or the most ‘trendy’ topic, but if you invest in any form of training and development, then you would like to make sure that you get the best return from it, right?

Measuring the impact of training

Let’s start with the Holy Grail of training – or, in other words, measuring its impact. In his seminal book, Evaluating Training Programs: The Four Levels, (1) Don Kirkpatrick has defined a four-level evaluation model which covers:

This is a very useful model for helping you to consider how you can better evaluate the training you offer and there is no pretence that doing so is easy. It is not. Still, in my experience, few companies get beyond Level 2 evaluation. The key to attaining Level 4 evaluation for training is to try to link the outcomes from specific training activities to tangible business measures such as customer satisfaction, employee satisfaction, sales, cost reductions and individual performance results. For example, a customer care training programme should make a defined impact on the quality of service and this could be tracked through your customer feedback results. Management development (depending upon what’s covered, of course) should make an impact on an individual manager’s performance which should show up in their Key Performance Results; or more generally, providing management development training should lead to higher engagement levels of employees which can be tracked through the employee engagement survey.

It sounds obvious to say that how you intend to ‘measure’ the impact of training should be discussed and agreed before the training is actually delivered, but despite this obvious logic, it rarely happens in my experience. Instead, the issue of how to gauge the benefits gained from a training programme is often only considered after the training has been delivered. In essence, the measurement issue should be an early consideration, not an afterthought and preparation questions should roughly appear in this order:

• What gaps/opportunities have been identified for which training could be helpful?
• Who needs this particular training, or would benefit from it?
• What, specifically, do we want this training to achieve/deliver? How can that be quantified? How will we measure that impact?
• To achieve those results, what must the training cover? What content is essential?
• How should that content be structured?
• Etc.

“Work harder on yourself than you do on your job.”

The above are the often quoted words of Jim Rohn, the American entrepreneur, author and motivational speaker and I think they are real pearls of wisdom. Sure, this and many other sound bites abound these days but I think that this particular example, when you give it some thought, has real substance. Sadly, for  most managers I know, the opposite applies and they, by necessity, spend far more time focused on the needs of their job than they do on those related to their personal development. Now, don’t get me wrong, I start with that quote today not with the intention of sending out a message that you should work less hard at whatever your role is – no, give the job your all, each and every day  – but alongside that you should devote more time to self-development than you likely do at present. How you actually find that time is naturally up to yourself, but find it you must. If this recession has thought us anything, then it’s the need to ensure that we don’t allow ourselves to become obsolete or to get left behind; and this is not only a concern for unskilled (and even skilled) workers whose roles may be more easily replaced by technological solutions, it applies just as well at a management level.

Think of it another way. Most businesses, as you are undoubtedly aware, need to plan for the future. No doubt, part of what you are doing today – the decisions you take, or choices you make – will not bear fruit until several months or years ahead. Products and services in the pipeline at present may not come on stream for some time, but they must be planned in advance so that when they do arrive, they will give your business an edge. From a personal perspective, ask yourself what seeds you are sowing today that are going to bear fruit in the years ahead? When I raise this question and others like it with managers that I mentor, it often unnerves them, but that of itself can serve to spring them into action. When thinking about, and indeed planning, your own self development, you should focus on a number of key questions:

How well do you know yourself?

Self-awareness isn’t something you hear discussed all that widely amongst managers although in truth it should be top of any list of ‘must-haves’ and especially so in terms of guiding your self-development efforts. When you possess high levels of self-awareness this means that you can better identify what you are good at but also where your areas for improvement lie. As a result of that understanding of self, you are then more likely to try to minimise the impact of your weaknesses and indeed work to eradicate them over time. There is no shortcut to developing your levels of self-awareness but a good starting point is to consider how much structured (and meaningful) feedback you currently receive on your work performance over the course of a year? If the answer isn’t ‘a lot’ then you need to think about how you can grow that over time – just as you cannot plan ahead in business life if you aren’t fully aware of the current position, the same applies to your personal development efforts.

What are the key skills, knowledge and abilities that are going to be important in your field in the years ahead?

This assumes that you have a fair idea of what your chosen field is at present, but even if you aren’t sure of precisely where your future lies, you can still consider the critical skills that are going to be important regardless of industry or field. Now, you may well feel that this is pointless navel-gazing, or that you’d be better off staring into a crystal ball for an answer, and of course nobody can accurately predict the future, but there are plenty of studies looking at this very subject; and with regard to a medium term horizon at least, there is a fair degree of consensus as to what sort of skills will be critical for any manager. One such study (Google this issue as there are plenty more studies available) conducted by the American Management Association(1) found that along with specific job-related skills, four C’s were likely to be  important in the years ahead: a) critical thinking and problem-solving skills, b) communication skills, c) collaboration skills, and, d) creativity and innovation skills. These are clearly already important today but it isn’t a stretch to understand that they will become even more essential in future, as you deal with greater uncertainty, stronger competition and need to get the most from every one of your employees.

What are you going to do about it?

Even if you manage to build your levels of self-awareness, and even if you can identify some personal skills gaps, you still need to do the hard bit – bridge those gaps. Of course, we all have the best of intentions about the ‘doing bit’, but these often quickly fall by the wayside (think of your recent New Year resolutions if you made any – how many are you still sticking with?). There is no easy answer to avoiding this common human failing of letting things slide, but setting goals is a good first step.

Setting goals is of course important, but with some reservations attached, in my opinion. Goals are good, if and when the goals are good. What I mean by this is that setting unrealistic personal development goals can do more harm than good. Too many people today – driven by a lot of self-help mumbo jumbo – set improbable goals for themselves, given their talents and the level of effort they are prepared to put into realising them. This can, when those goals are not achieved, have a negative rather than a positive impact. Therefore goal orientation and personal development undoubtedly go hand in hand, but with these provisions in mind. First and foremost, you need to define areas where you must develop yourself and then set some goals to focus your efforts. Here is a simple conceptual framework that I developed for devising and implementing personal (or indeed business) goals:

Okay, so today’s post may not be a ‘here and now’ issue for you, but it is still a vitally important one in terms of sustaining your success and I think the words of Richard Branson sum up very well the attitude we all need to take towards the personal development journey when he said: “My biggest motivation? Just to keep challenging myself. I see life almost like one long University education that I never had – every day I’m learning something new.” This captures nicely what is needed and don’t leave it until another day to think about your personal development. Start now.

Enjoy your day!

1. AMA 2010 Critical Skills Survey

Recently I met up with an old friend of mine and he was having a bad week, or so it seemed. Over a pint, he explained some of the recent ‘hassles’ he had to deal with at work (and obviously I’m paraphrasing here).

“I have one chap in IT who is an absolute genius at what he does, worth his weight in gold, but he has the people-skills of a gnat…plus he has a severe BO issue,” he told me. “My sales guy could sell snow to the Eskimos but his damn head is so big we have to keep widening the office door every couple of weeks, so he can actually get into work…one of our receptionists positively drools when a handsome guy arrives for a meeting but we’ve had to speak to her on occasion about how condescending she comes across to any attractive female who might turn up. And only today, I had to sit two of my relatively senior managers down because they had ‘torn strips’ off each other at a meeting, in front of half the team, because as one of them said ’he interrupted me whilst I was speaking’.”

He was half-joking as he said all of the above, but in doing so he got me thinking about an important challenge for any manager, that of dealing with the range of personalities you find in any workplace. And there is a dilemma here too. It is undoubtedly the variety of personalities you encounter every day that makes your job enjoyable (it would be pretty boring to be solely in charge of machines for a living) but at the same time, it is those very same personalities which create most of the people-related problems you have to deal with day to day. And that’s the focus here, how to better understand your own personality and those of others.

What comprises our personality has long been studied by psychologists and one widely applied model for understanding this complex area is known as the Five Factor Model, also described as OCEAN, which argues that our personalities are in fact a combination of five dimensions:

• Openness to experience
• Conscientiousness
• Extraversion
• Agreeableness
• Neuroticism

These ‘Big Five’ as they are known are generally accepted in psychological circles as being the foundation of our personality and I think that for every manager, albeit in an unscientific manner, it is highly useful to consider these dimensions in terms of how they apply to you personally, and to those around you. The model is also helpful because it creates an understandable framework to explore what is clearly a highly complex area.

Openness to experience

In essence, Openness to Experience is a dimension which is concerned with the balance between creativity as opposed to conventionality. In other words, ‘open’ people are considered to be curious individuals, who are more aware of themselves, seek out new opportunities, and who tend to act and behave in non-conforming ways. At the other end of the scale, individuals who score lowly in this area tend to prefer the straightforward and defined over anything that’s vague or ambiguous; they prefer the known to the unknown, the familiar rather than the new. Naturally, open and closed styles have their place depending upon the environment involved; for an entrepreneur, having high openness would likely be advantageous, even necessary, whereas a more closed focus might be better in positions where there is a need to conform to the norm or where the questioning of authority or the status quo is not welcomed.

Conscientiousness

Conscientiousness has to do with how we control and regulate our impulses. Some people, those with low conscientiousness, are impulsive by nature and have a tendency to act spontaneously or on the spur of the moment. Others are more restrained in how they act. Now, impulses are not necessarily always bad, but the difficulty with overly impulsive behaviour, particularly in a management context, is that it can diminish effectiveness because it prevents the rational analysis of alternative options and generally leads to poor decision-making.

Alternatively, individuals with high conscientiousness tend to avoid trouble and achieve higher levels of success through purposeful planning and persistence; however, taken too far this can bring its own problems in that it can result in someone being so calculating as to dwell excessively over decisions, or to be so ‘in-control’ as to be downright boring.

Extraversion

This is a widely discussed dimension and is concerned with our levels of engagement with the external world. Extraverts generally enjoy being with others, are energetic, upbeat and positive characters who get a buzz from the ‘crowd’. By nature, they tend to search opportunities for adventure or doing new things and can be assertive individuals. Introverts on the other hand tend to be the opposite and are usually quiet, reserved and even shy individuals or certainly can seem that way until they feel more relaxed and comfortable with others when they can open up.

Agreeableness

Agreeableness of course is concerned with how great our capacity is to like and get along with others. Agreeable people are friendly and considerate towards others and will consider the needs of the group alongside their own wants. Disagreeable individuals are generally more concerned with self-interest than in protecting relationships with others and they can often be unfriendly and uncooperative to boot. Again, we imagine that agreeableness is always the preferable option, and of course it certainly does increase popularity levels, but being too agreeable can be problematic when faced with having to make tough decisions.

Neuroticism

This dimension is concerned with our levels of anxiety and emotional tension. Those who score high on neuroticism may have a propensity for negative feelings, anxiety or even depression; and, for some, those feelings can be so persistent or intense as to deeply impact on how they live their lives to the extent that they find it hard to ‘cope’. By contrast, individuals who score lowly here have a calmer demeanour, are more emotionally stable and tend not to suffer negative feelings, or at least not for prolonged periods.

Now, these are undoubtedly short, and perhaps even superficial, summaries of the five dimensions of personality and the important point to recognise is that we are all a mix of these factors and that’s what makes up our personality.

From a manager’s perspective having a general understanding of these dimensions is naturally good in a number of ways. First, in terms of your own self-awareness it is always important to develop even a general understanding of how the mix is manifested in you; and of course to take action over time upon what you learn so that you can continuously improve. Equally, when managing a team, of any kind, or size, you need to recognise just how complex each of your employees is. And like it or not, to get the most from your people – individually and collectively – an important part of your role is to try to understand them as much as possible and to get all those in the team to value the different contributions each person makes in their own unique way. In this regard the OCEAN model is undoubtedly useful.

My experience in this area is that an individual’s personality, by the time they reaching working age that is, tends to be relatively formed and remains stable over time so, when you pay attention that is (and without having to be overly scientific about it either), you can get a handle on where an individual sits against each of the five dimensions. And as our personality can change over time, you can develop yourself, and by the way you coach and mentor, or reward and recognise your people, you can help them to smooth over some of the rough edges as well.

There are many online tests available in this area, some of which can be overly simplistic it has to be said, but if you Google this area you will find some useful options. Of course there are many other well-known (and expensive) personality tests available which you will likely complete at some point on management courses.

To close, the intention here was to take a snapshot look at the issue of personality, which is undoubtedly highly complex, with a view to helping you to consider it from a management perspective. The best managers understand something about their own personality and that of each of their employees and they use that knowledge to help them manage more effectively. Or, as my friend said to me over our pint, as he listed the various personalities he has to deal with in his business: “You don’t have to be a shrink but it helps”.

Enjoy your day!

You may well be wondering what the heck this is about? Well, it was part of an award winning advertising campaign run by National Australia Bank (NAB) a number of years ago whereby – on Valentine’s Day no less – they began the campaign with the widespread publication of the above letter as part of their attempts to differentiate themselves from the other big banks in the country, namely Westpac, Commonwealth and ANZ.

Now, if it had solely been an advertising campaign, then it would have been a worthy award winner (and it did win a number of national and international awards) but perhaps no more than that. However, as Greg Sutherland, the executive general manager of strategy at NAB explained in an online interview (1) available on ‘The Management Innovation Exchange MIX’ (www.managementexchange.com) – the ad was but one part of a far wider and deeper effort to differentiate NAB from other banks by, in part, really listening to customer complaints. As he explained, “when we set our path of innovation to actually be truly differentiated versus other banks, we said the first place to look was what our customers were saying”. Specifically, he went on to highlight that “for us the number one complaint is fees, and 80% of all the complaints were on one fee. . .so after ten years of looking at that, we made the call that we would launch our point of differentiation from getting rid of that fee. And I think Cameron [Clyne, NAB's chief executive] said something very powerful when describing that. He said, ‘You can’t keep serving bad beer, right?’ You can’t build a sustainable business, even if you think it is justified.If the customer doesn’t like it and complains about it, then you’ve got to change it.”

I like that bad beer analogy and as Greg Sutherland went on to explain ”it served as a lightning rod for the company whereby the mantra became ‘if the customer doesn’t like it, then we’ve got to change it’.”

For me, and no matter what business you are in, this example should tell you two things. The first point it emphasises is that when you are trying to communicate a vision or concept internally (and indeed externally), sometimes the simple, or plain-spoken, analogy works as well, if not far better, than all the jargon or business-speak in the world. There isn’t too much explaining to be done vis-à-vis the notion of not serving bad beer. So, whenever you are seeking to communicate something important try to find ways of making it ‘stick’ for the intended audience.

The second point, and the substantive issue in today’s post, is that you should be continuously thinking about how you can differentiate your business from the competition. This, I find, is becoming harder and harder to achieve. All businesses watch each other closely these days, have similar access to expertise, use common benchmarking tools, have access to the same technology and the web in particular makes it very easy to find out about new ways of doing things. So, in many cases, differentiation is a moveable feast at best and you may well find something that sets you apart from your competitors but that will likely only give you a short-term advantage. On that point, and I am guilty of this myself sometimes,  when we talk about gaining ‘sustainable competitive advantage’ is that really possible these days? Maybe certain things are less ‘replicable’ like your culture or service quality, but ultimately your competition can catch up sooner or later. The trick of course is to always be one step ahead, so differentiation should be a strategic concern not something to be addressed every now and again.

That, of course, is easier said than done; constantly differentiating your offering from that of your competitors doesn’t just happen and requires a host of supporting factors to be in place within your business such as the right culture, engaged employees, an effective innovation framework and intangibles such as a collective desire to be the best. That’s why so many businesses follow the ‘differentiate-by-price’ route: it’s easier. But when you think about it, that’s the simplest option to copy and that’s why differentiating solely on price leads to downward pressure on prices which hurts all players in the market; and, in turn, this almost rules out the potential to differentiate by other means because with lower revenues coming in the resources to invest in product or service differentiation simply aren’t there.

There are any number of models of differentiation but one in particular caught my eye recently. In an article in Harvard Business Review (2) Chris Zook and James Allen, leading strategists, introduced their Differentiation Map which I have reproduced below:

As they explained in the article “We cataloged 250 assets or capabilities that can make up a company’s differentiation. We then sorted them into three major clusters, each with five categories, to create the Differentiation Map. Assuming that four or five categories are required to achieve differentiation, these 15 basic categories generate more than 5,000 distinct ways in which a company can differentiate itself. (It is possible, however, to break the categories down further, in which case the number of ways to differentiate explodes into more than a million.)

I find this to be an extremely useful conceptual framework to stimulate discussion amongst senior managers as to where the potential for strategic differentiation lies and it is in the various potential combinations (like if you excelled at Technology and Customer Relationships) that the map can help you to pinpoint where you can make strides to strengthen your approach to differentiation.

At an operational level, focusing in on one vital aspect of business performance, namely product and service quality, I frequently use the following framework to drive the discussions with managers, supervisors and employees as to how they can set themselves apart from the competition. I call it the Quality Window:

The framework is quite simple and focuses on designing, promoting and delivering products and services that are second to none and then continuously listening to your customers so that you are truly in tune with their changing needs. Again, I find it is a useful thought-provoker which can stimulate a meaningful discussion around issues such as:

Product: How do your products meet customer demands in comparison to those of your competitors. Where is the potential to develop/enhance/tweak your products to really differentiate them from others?
People: How does the service offered by your employees, across all areas of the customer experience, compare to others? What can you do to make your service quality a true distinguishing feature that cannot be so easily copied by comeptitors?
Procedural: linked to your service, do your procedures make it easy for your people to respond to customer needs? Again, are there procedures you could simplify or even erradicate that would make you stand out? Often this can be achieved in simple ways, for example, how complaints are managed can at times be overly cumbersome in some companies.
Physical: if your customers come onsite to buy your products, or experience your service, how do your physical facilities stack up? What aspects of your physical facilities or location can give you an edge?
Promotional: how do your promotional efforts compare to what others are doing? Are you really setting your offering apart by the way you promote it?

In essence the Quality Window can be a useful framework both to assess current effectiveness in the quality arena, but also to guide the conversation as to where you might be able to differentiate what you do from the rest of the herd.

And when looking at the potential for strategic and operational differentiation in your business, don’t be like the smart-alec who said to me last week when I introduced this topic: “is there any such thing as bad beer?”

Enjoy your day!

References

[1] Interview with Greg Sutherland – http://www.managementexchange.com/video/greg-sutherland-you-cant-keep-serving-bad-beer

[2] The Great Repeatable Business Model by Chris Zook and James Allen. HBR. November 2011. http://hbr.org/2011/11/the-great-repeatable-business-model/ar/1

You will likely at some point have heard the question asked: are leaders born or made? Yes, yes, I know, it’s a really annoying question at the best of times but it is an important one nonetheless. And you will no doubt also have heard people offer opinions for, and against, the nature-nurture debate. You probably have your own views on the matter. Now, according to a new study, the answer to this question is that yes they are born, or at least in part, because researchers have identified something which is being touted as the ‘leadership gene’.

In a study which was recently referred to in the Leadership Quarterly, an international research team estimated that a quarter of the observed variations in leadership behaviour between individuals can be explained by genes passed down from their parents. Lead scientist Dr Jan-Emmanuel De Neve, from University College London, explained the findings: “We have identified a genotype, called rs4950, which appears to be associated with the passing of leadership ability down through generations.” Dr De Neve also added, “As recent as last August, Professor John Antonakis, who is known for his work on leadership, posed the question: ‘is there a specific leadership gene?’ This study allows us to answer yes – to an extent.”

So, effective leadership is now beyond the grasp of most of us then, reserved for the chosen few? Should we all just give up?

Clearly not, and this findings regarding the rs4950 genotype have more to do with predicting who is more likely to occupy leadership roles than it has to do with the effectiveness of individual managers. So, whether you have the gene or not, in terms of looking to improve your ability to manage others, there’s clearly not much you can do about the ‘born’ part at this stage; what you can do, though, is focus on the ‘made’ part. And in doing so, you should think about your own strengths and areas for improvement with a view to constantly seeking to get better at what you do. Naturally, there is no model of the perfect leader against which to benchmark yourself, but here are some key traits and skills – in no order of importance – that are seen in all effective managers. You should reflect upon how well you perform against each of them at present.

The best managers:

1. Lift others
Some people could suck the life out of you given half a chance, and dealing with them is draining at the best of times. You know the type, the ‘heavy sighers’, the doom-and-gloomers or the ‘end-is-nigh’ brigade. Not so as far as effective managers are concerned. They do the opposite and make you feel energised and engaged, not in a corny seize-the-day sense, but interacting with them just feels good. Now don’t get me wrong, I’m not saying you need to be one of those Mr. or Mrs. Motivator types to succeed as a manager, but certainly you do need to be able to lift others around you, in your own way and appropriate to the culture of where you work of course.

2. Connect with people
Leading others means connecting with them, in a substantive way, and that in part requires you to be an effective communicator: you cannot connect if you cannot reach and you cannot reach if you cannot communicate. The best managers have a natural talent for communicating and apart from the qualities and skills they possess which help them to interact well with others, they also get the point that they need to GET to the point; people don’t like wafflers, beat-around-the-bushers, or those who simply like the sound of their own voice.

3. Keep pushing
The best managers constantly set the bar higher in terms of their own performance; they never settle for second best and are self-motivated and goal-orientated individuals. And they demand the same of others too, although in doing so they never expect people to be ‘just like them’ but they do want their employees individually and collectively to achieve things.

4. Have a vision
A lot of people sneer at the visualising stuff and to be fair there is often a lot of nonsense spouted about it, but at the end of the day, it is not possible to ‘bring people with you’ if you haven’t got  a clear sense of where you’re headed which you can communicate in terms that matter to them; for example, making a profit is a worthy aim, but it’s unlikely to mean a whole lot to your employees (unless they share in the profits, of course). Having a vision is not about the ‘climbing-to-the-top-of-the-mountain’ guff you often see depicted in photo adverts for MBA programmes and the like but, again in your own way, you need to have a clear picture of where you’re headed which you can get your people to ‘buy into’.

5. Are smart
The best managers are bright characters but not always in a ‘booky’ way, although at the same time, they never wear the ‘D’ for dunce hat either. They have a range of smarts which help them to master the technical skills associated with their role, analyse problems and make decisions based on a solid understanding of relevant micro and macro issues. Added to that, they always seem to have a fair helping of that critical, if somewhat intangible, commodity called common sense.

6. Champion change
The status quo can be appealing at times; if nothing else, the tried and tested is less hassle and ‘when it ain’t broke, don’t’ fix it right?’ And yes that’s true to an extent, but it very much depends upon how you define broke. Just because something is working or going well, doesn’t mean it can’t be improved upon or further enhanced. The best bosses are those who are not afraid to try different things. New is good, as far as they are concerned, if it means potentially achieving better results. They are open to taking calculated risks in the first place which means they can push boundaries, but in doing so, they also excel at harnessing the knowledge of those around them to the point where ideas and suggestions are welcomed from many sources and the flow of creativity is encouraged throughout the business. They recognise that the manager’s role is not necessarily to have all the right answers but to know how to find them.

7. Involve people
Everywhere you go these days in business circles you hear talk of empowerment; ‘people are your greatest asset, so maximise the returns they deliver for you’ and all that. Sadly, it’s often just hot air. The best managers however do it for real because they recognise that genuinely including people in the running of the business delivers improved results. They understand that when people, or at least the majority, are empowered in a meaningful sense they feel valued and respected and because of that they give more. In the eyes of effective mangers, everyone is given a chance to participate and contribute. That said, those who don’t play their part are not tolerated for long though.

8. Age well, like good wine
Experience helps, if we are doing the right things, that is; continuing to do the wrong things simply makes a person progressively worse not better. Like everyone else, the best managers have faults and make mistakes but they learn from them and because they have a real desire for self-development, they continuously  improve over time – they never see themselves as being the finished article.

9. Live by a creed
In recent years there have been many examples of once lauded executives who have spectacularly fallen from grace. Sure, they all crashed and burned for different reasons, but a big factor in their downfall was that they each lost their moral compass, or maybe they never had one in the first place. That is not to say that good managers are always Holy Joes, but they do know right from wrong, and more importantly than that, they choose the right path even when that may be the more difficult option.

10. Have great self-control
This one is probably a bit more on the ’nature’ side of the equation, but it is possible to develop your levels of self-control over time, so in that sense it can be nurtured. Self-control is vital because it helps effective managers in so many aspects of what they do. For starters, it allows them to think clearly, which helps in decision-making and that in turn results in fewer mistakes. It also enables them to act rationally not emotionally when faced with difficult people or situations, so they can decide which leadership style is best to apply in any given situation. In general, the ability to maintain self-control helps them to ‘think’ first and then ‘do’ in a variety of situations which makes them more effective all round.

Okay, this is not an exhaustive list of talents you need to succeed as a manager, but it’s a good start in terms of factors that set the best apart. As to rs4950, I’m sure you have that too, but either way it’s out of your control at this stage, so focus on what you can tangibly do to improve your performance. And, in doing so, the above list is well worth considering as a first step.

How would you currently rate yourself in each of those dimensions?

Enjoy your day!