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Archive for the ‘Leadership’ Category

10 Principles to Optimize Your Business Results: Principle #5 — Key Factors Shaping Your Business Results

20 Dec

We’re now approaching the halfway point of our examination of the 10 Principles in this series. Let’s now look at the key factors that affect the results you get out of your most powerful asset — your people.

A successful business runs on successful people. Companies don’t make things happen; the people in those companies do. Think of each employee in your company as a “success engine.” Not a cog in the machine, not an interchangeable gear, but a generator of energy. When that energy is positively aligned with that of others, a massively congruent result takes place. We call it success.

The key factors that align your people toward successful results include:

A compelling vision. Recall Principle #2: When people combine forces under the banner of an exciting, energizing vision, they become invested in the success of the final outcome — they own a piece of that success, and work together to achieve it.

Clear values. What does your company stand for? When you define your company’s values, your people understand not only what they do but also why they do it.

Effective strategy. We discussed in Principle #3 how strategy represents the “How” of your business. When your people can see the whole plan from 30,000 feet, they understand just how their function affects the entire process.

Collaboration, commitment and trust. As your people comprehend the vision, values and strategy behind your company’s design they come “on board” with it, agreeing to work together to make it happen and support each other in an open, trusting environment.

Responsibility and accountability. Simply put, when your people feel that they partially own your company’s success or failure, they step up and take responsibility for doing their part as well as possible. Accountability breeds quality.

See you at Principle #6!

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10 Principles to Optimize Your Business Results: Principle #4 — Conversations as a Core Business Process

06 Dec

Number 4 on our list of 10 Principles deals with an everyday element of our lives that we take for granted even as it makes all human interaction possible — conversation.  We’ve seen that every business is designed to get precisely the results it is getting. But what plants the seed of that design, and how does it germinate? What cements that design into place once it takes shape — and how do we reshape it?

If you think of your business systems as a structure, or as a set of interrelated structures and sub-structures, then think of conversations as the glue that holds those structures together. By conversations, I mean not only spoken communications but also written directives and even the many unspoken messages that occur between or within departments and teams. (Silence, after all, can speak volumes depending on the subject, the object and the players.)

Conversations can connect, disconnect, or have no effect whatsoever on individuals. Ineffective or poorly conceived communication channels lead to failed connections, causing everything from minor inefficiencies to outright catastrophes. They also connect the wrong people within a project or perpetuate outmoded connections, causing a “hardening of thee arteries” that bars your business from the flexibility it needs to adapt and evolve. These old, ossified communication channels are like the adhesions that form between tissues after surgery to cause pain and stiffness in recovering patients.

How do you restore flexibility and relevance to your business’s design? Change the conversations. Open new channels and break old ones until you have the right glue in the right place. And yes, just like breaking those surgical adhesions, changing those communications can be a painful process — but it’s the only way to get the patient up and running again.

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10 Principles to Optimize Your Business Results: Principle #1 – The Business as a System

26 Oct

The first of our 10 Principles concerns a critical if sometimes ugly truth: Every company is perfectly designed to produce the results it gets. Every function within the company and how they are aligned contributes to the designed results. If you don’t like the results you’re getting, you have to change the design.

Before I turned my full focus toward turning businesses around, I spent many years as an engineer. Engineers, of course, have to know how things work. It’s not enough to design a beautiful cog – you have to know exactly how that cog interacts with other cogs, gears, and sub-assemblies to achieve a desired result. You have to visualize the entire system so that if something goes wrong, you can pinpoint the problem or see how multiple problems aggravate each other to cause a systemic breakdown.

Companies are systems too. Their sub-assemblies are made up of departments. Departments are made up of teams. Teams are made up of people. All of these components must work together to ensure a properly functioning system. If you’ve selected faulty parts, don’t expect your system to yield good faultless results. On the other hand, you can assemble the most beautifully crafted parts in the world into your machine, but if that machine has a flawed design, it still won’t give you the results you want.

CEOs ultimately hold the responsibility for the design of their business. They choose the systems, select the teams, and develop the structures that make the difference between glorious success, abject failure – or, in the middle of the spectrum, inertia.

Does your company’s design meets specifications? Are you getting what you originally envisioned? If not, examine your systems for flaws – and be ready to go back to the drawing board.

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10 Principles to Optimize Your Business Results: Introduction

12 Oct

With this post I’m launching an extended series on a set of 10 principles formulated to help CEOs correct broken businesses and crippled companies. Strategic Momentum uses these very principles to take their clients from stagnation to new heights of success. I crafted them myself in the early 1990s to fix the systemic flaws and limiting factors in an industrial PC company of mine, doubling the company’s revenues within an 18-month period. These principles have proven themselves under fire time and time again. They are:

Principle 1:  The Business as a System

Principle 2: The Power of Vision

Principle 3: The Importance of Strategy

Principle 4: Conversations as a Core Business Process

Principle 5: Key Factors Shaping Your Business Results

Principle 6: Conversational Dynamics

Principle 7: Mindset Shapes Results

Principle 8: Relationship and Trust as Critical Success Factors

Principle 9: Processes and Capabilities

Principle 10: Leadership as a Critical Success Element

I will discuss the concepts behind each principle and the role they play in bringing balance, order and productivity to the systems that drive a company. By the time we explore all of these principles you’ll see how they all work together to engineer a new, more successful business design.

Oh, and by all means feel free to post comments or questions as we go. I’d love to make this series as useful and as interactive as possible for all of us. Stay tuned – and enjoy!

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No Theory – No Learning

15 Aug

Dr. Deming, a thought leader, in quality improvement theory and practice once said, “No theory, no learning.”  What does this mean? Don’t we learn through experience?  Isn’t experience itself a teacher?  I say NO!  I do not believe experience teaches; rather only refection on experience teaches.

It is difficult to reflect on experience if you do not have a good working theory to be the mirror providing the reflection. As a system engineer turned CEO, I have studied organizational theory and behavior for over twenty five years. Over this period of time, I learned that every company is a system perfectly designed to produce the result it is producing. If you do not like the results, you have to change the design.  I also learned that the system design did not just happen. It evolved through a conversational process, and everyone in the organization contributed to the process and the current state of the design.  How can I say everyone contributed to the design? Isn’t it clear that the executives and managers are responsible for the organizational design?  Yes, they are part of the system, and may have a heavy hand on the controls, but everyone else is also part of the system, and they do have an influence on the design, usually stronger than they believe.

Look at it this way, organizational excellence is not based on one or two factors.  It is based on several interrelated factors starting with compelling vision and effective leadership.  When I say leadership, I do not just mean leader ship at the top.  I mean leadership throughout the organization.  With a compelling vision as the context for action, the next aspect of leadership is to create a powerful strategy as a means to bring the vision into reality and effective operational structures to execute the strategy.

The underpinning of strategic and operational effectiveness is ultimately the effectiveness of the teams throughout the organization. At the end of the day companies do not innovate or execute, people do.   

When all of this is done with excellence, the result is financial effectiveness and business growth.

Here is a framework to look at many of the key aspects of your organizational system. If major capabilities and/or processes are missing or are ineffective, then your results will suffer until you change the design.

Compelling Vision 

Effective Leadership

Strategic Effectiveness

  • Strategy Formulation
  • Strategic Objectives
  • Strategic Positioning
  • Competitive Strategy
  • Technology-Product/Service Strategy
  • Business Development
  • Offers/Target Customers/Marketing Strategy
Operational Effectiveness

  • Systems
  • Structures
  • Processes
  • Practices/Methods
  • Measurement
  • Tools

 

Team Effectiveness

  • Cooperation/Collaboration/Coordination of Action
  • Capability Development
  • Engagement/Empowerment
  • Conversational Competencies
  • Trust/Full Self Expression
  • Adapting To The Business Environment
  • Managing Mood
  • Learning/Change Management

Financial Effectiveness

 

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Don’t Wait Too Long To Ask For Help!

08 Aug

Don’t Wait Too Long To Ask For Help!

I am a sailor and when I started sailing in Lake Superior, I learned the term sea room. One definition of sea room is “an unobstructed space at sea adequate for maneuvering a ship.” Another definition is “the space required by a vessel between its path and the shore or an obstacle.”  Why is this important? Well, when a squall shows up you better have enough maneuverable space to prevent hitting the rocks and sinking your boat.  I am not a pilot, but I bet the same is true for flying.  If you’re in a dive you better have enough airspace to pull up to prevent you from crashing and burning. Likewise, if you are attempting to take off you better have sufficient runway to build the velocity necessary for takeoff, or again you are likely to crash.

Unfortunately, this analogy is strikingly relevant to business.  If a CEO waits too long to ask for help, they are likely to run out of time, and either hit the rocks or crash and burn.  I have to ask, why is it that many CEOs wait until their options are so limited they have little room to maneuver? Is it ego in the sense that they want to figure it out by themselves?  Is it that they do not trust that anyone has the necessary skills to help?  Is it that they don’t know how to ask for help?  Alternatively, is it that they don’t know what they don’t know, and it never occurs to them that help is just a phone call away?  I don’t believe there is one answer.  I would like to hear from other consultants what their answer to this question; “why troubled companies either don’t ask for help, or ask for help too late in the process.”

Remember, a company is a system perfectly designed to produce the results it is producing.  If you don’t like the results, you have to change the design.  At the same time, you cannot wait until it is too late. Having an outside set of eyes looking at the design can make a critical difference in the outcome.  You cannot intervene in a world you cannot see.

In my next post, I will tell you a success story where asking for help made the difference between crashing and burning versus flourishing.

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Every organization is perfectly designed to produce the results it is producing!

17 Jun

Every organization is a system, and as a system it is perfectly designed to produce the results it is producing! Is this true? We have been in front of executives who will disagree with this, at least initially. Often it is because they trip over the fact that it is perfectly designed. As a leader, this can be a hard message to hear, as the buck stops with you!

Can you see that this sometimes is a hard message to deliver to executives? If you are not getting the results that you are looking for, and yet you have been working hard, does that mean that you have been doing it wrong?

Now, let’s look at the good news. The good news is that once you accept this premise, and you see that it is a design, now you can start looking for what it is you can change in your design to significantly improve your results.

As discussed at several topics here on our blog, you design your company system through the conversations that you are actively having as well as those that you have codified in employee manuals, procedures, plans. However, your design is also stuck in unspoken conversations that you should be having but you are not having. The classic example is of a company that wants to be innovative but does not reward risk taking.

Once you recognize that, you can now also see that if you want to change your results, and therefore the design of your team or company, you just have to change your conversations.

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