Posts

Organization and Staffing – Ground Rule #4 – Dealing with Advancing Age

This is the eleventh in a series of posts that will describe what the CEO of the Reliance Electric Company thought about basic commitments, how the organization was going to operate and ground rules for managers. Once again, all the content of this article is based on the work of B. Charles Ames as outlined in his management manifesto titled Basic Management Concepts dated January 14, 1974.

Organization and Staffing – Ground Rule #4 – Dealing with Advancing Age 

I am going to deviate a bit from my normal practice of simply repackaging the words Chuck Ames used in Basic Management Concepts for Ground Rule #4.  Ground Rule #4 deals with advancing age in the workforce.  Some of the content needs to be brought up to current EEOC standards.  Plus, there is some new research that suggests our opinions about the capabilities of older people in the workforce may not be quite accurate.  See “Why Everything You Know About Aging Is Probably Wrong” from the December 1, 2014 Wall Street Journal.

Ames wrote that some individuals, as they age, may reach a point where their job responsibilities exceed their energy levels and capabilities.  At some level this is certainly true and will indeed happen to us all.  Ames felt that the organization had an obligation to people who served it loyally.  He stated they should be paid fairly and given assignments where they could be successful.

He went on to say that older workers unable to make a continuing contribution needed to be removed from the mainstream.  He figured it wasn’t fair to the individual or the corporation to leave people in roles where they were likely to be unsuccessful.  An appropriate ground rule, regardless of age, I would add.

In conclusion he wrote that advancing age alone should not be a reason to exclude anyone from consideration for an assignment.  He stated there is nothing more wasteful than bypassing an experienced individual because of age even though that individual has the drive and energy to be successful.

Certainly an excellent ground rule whether it is 1974 or 2015.

B. Chuck Ames and his wife Jay currently manage the Ames Family Foundation.  They divide their time between a home in Vero Beach, Florida and a second home in a suburb of Cleveland. 

 

 

 

How to Be an Effective Group Leader

Why Dominating Leaders Kill Teams

Dominating leaders tend to stifle creative ideas that might otherwise emerge from group discussions thus making the teams less productive.

Francesca Gino is an Associate Professor in the Negotiations, Organizations, and Markets Unit at Harvard Business School.  In the November 13, 2013 edition for “Working Knowledge” published by the Harvard Business School, Michael Blanding discusses Professor Gino’s series of studies in which she and her colleagues, Leigh Plunkett Tost of the University of Michigan and Richard P. Larrick of Duke University found that when leaders are focused on their own sense of power, they can hurt the performance of their teams—but with an important catch. The effects only occur when leaders are actually in a position of power.

Usually when we think about groups, we think that a strong leader naturally improves the functioning of the team. Professors Gino, Tost and Larrick explore this in depth in their article “When Power Makes Others Speechless: The Negative Impact of Leader Power on Team Performance”. In their work they differentiate between a “subjective sense of power,” that is, when someone thinks they have control over others, and actual power, when someone has formal authority over compensation, promotions, how resources are allocated or how decisions are made. Actual power and as sense of power often go hand in hand, but not always.

Sometimes in a group situation without a formal leader, a leadership role can be assumed by a person who believes he or she has superior knowledge or skills. The researchers found that in cases when someone felt powerful but was not recognized as being in a position of authority, team members were able to override that person’s domination of the conversation and add their own input.

As I would expect, they found that in the best performing groups, the leader orchestrates the conversation, and gets everyone talking. In other words, strong leaders can and do improve team performance when they go into a situation with a sense of humility about their own relative power.

On the other end of the spectrum, poor performing teams were dominated by a leader who made his power known, controlling the conversation and stifling input from the non-leader members of the group.

In conclusion, Professors Gino, Tost and Larrick suggest there is a powerful opportunity to improve performance just by making leaders aware of the dangers of hogging airtime in a discussion.

“I want to believe that oftentimes we behave the way we do because we are not aware of the effects of our actions,” says Gino. “Bringing this type of awareness to leaders walking into group decision-making situations could set up a different process whereby they benefit from what others have to offer.”

They further conclude that being aware of the negative effects generated by an overpowering leader can make non-leaders feel more empowered to assert their own point of view—whether or not the person dominating the conversation is a formal leader.  I believe that this requires the non-leaders to trust that the leader with power will not exercise that power against them.

It is no surprise to me that getting leaders to listen to others and to facilitate a productive group discussion is powerful indeed.

Read the complete article, here.

Our Growth Strategies

Our Growth Strategies

This is the third in a series of posts that will describe what the CEO Reliance Electric thought about basic commitments, how the organization was going to operate and ground rules for managers. Once again, all the content of this article is based on the work of B. Charles Ames as outlined in his management manifesto titled Basic Management Concepts dated January 14, 1974.

In a multi-business company like Reliance Electric, a one size fits all, master strategy defined by corporate was destined to fail, according to Ames. He did not see a single thrust in the business or an “either or” proposition. He saw a “combination of thrusts” that would create the best opportunity for obtaining the company’s growth and profit objectives.

With this multi-business, multi-thrust concept in mind, Ames suggested a three phased growth strategy that would 1) increase earnings at a rate that was attractive to investors and 2) improve the quality and stability of company’s earnings. To accomplish this he suggested the following:

  • Continued emphasis on our strengths to increase profits from our core businesses.
  • Increased emphasis on products and markets less vulnerable to the ups and downs of of the economy. Service businesses, maintenance, repair businesses, for example, fit here as did all of the telecommunications businesses.
  • Increased emphasis on acquisitions that added to our strengths, particularly in businesses less vulnerable to business cycles.

Ames left the rest up to the individual operating company to decide. He wanted dynamic product and market strategies that were tailored to the individual opportunities of each business. He suggested that each business strive for a momentum in order to “make things happen” rather than wait and react to the competition. He felt we could not win by being defensive. His advice was to be aware of the competition but take the initiative and let them react to us.

Interesting advice, on the competition, regardless of the business or industry.  Just as interesting was the reality that everyone in the organization knew exactly what was expected in terms of job performance. Ames wrote it all down for all of us. And that may be the most significant basic management concept of all.

B. Chuck Ames and his wife Jay currently manage the Ames Family Foundation.  They divide their time between a home in Vero Beach, Florida and a second home in a suburb of Cleveland.  

 

Failed Change Initiatives Come Down To The CEO

 Most TEC-involved CEOs and organization leaders are well aware of the elements that need to be in place to create change initiatives.  In today’s world, change comes more rapidly than ever.

But by and large, these initiatives are not sufficiently successful … at least they don’t reach the performance levels we aspired to.

Why?

In his TEC presentations, Michael Canic of Bridgeway Leadership, Denver, provides a litany of required efforts under the headings of the right environment, focus and people.  But we get all that.  We do it, at least most of it.  So, why don’t our people make it happen?

He was asked about the top three reasons after a recent presentation.  They are, in his consulting experience:

1.  CEO Commitment

We say we are, but we actually aren’t.  Canic says, “There is a massive difference between the will to win, and the will to do what it takes to win.”  We earnestly put in place the roadmap for the change initiative and make assignments to our most competent direct reports, with touch base sessions.  But then we get distracted with all the other demands on our time.  We fail to give the impression that the change effort is a “must”.  We send a “mixed message.”  The energy we initially created subsides.

What the CEO has to do, he says, is have just one major commitment at a time … and focus relentlessly on it.  There might be three important ones, but deal with them sequentially.  It will be CEO attention that makes them happen, he says.  By your paying attention, people take responsibility to perform on schedule.

2.  CEO Capability

Simply, this means that some important elements aren’t put in place.  The CEO doesn’t know about them, or doesn’t feel they’re important to the initiative.  We’re good at knowing the technical things that have to happen, but not the “people” things.  These include knowing that people really do understand the purpose … what success looks like … have the knowledge and skills to do what’s expected of them … that they know what’s expected and by when … that they get affirmation … and help when they have a problem.  Simple things when we say them … but often missed.  Have a very visible Master Calendar, showing initiatives, champions and timelines, and manage to it.  It shows people the whole process is being managed, and they see where their part fits in.

As Canic says, what YOU do as CEO is not as important as what your PEOPLE experience.  Don’t assume.

3.  CEO Control of His/Her EGO

Too often, he says, CEOs compromise their own forward success by reflecting their past success in how they comport themselves, in their demeanor.  People recognize this immediately.  You aren’t on the same “level” with them, not on the same “team” with them … and it affects their commitment.  Successful change leaders hold their egos in check.  They put what’s necessary in place, and then spend the rest of their time being a servant, helping others to be successful.

Interestingly, he notes, all failed change initiatives come down to the CEO!

 

Unexpected Business Lessons from Artist Henri Matisse

Thanks Matisse!

I somewhat reluctantly (I am now embarrassed to say) attended the Henri Matisse retrospective at the Minneapolis Institute of Art. I freely admit to a limited appreciation for art, but this was a fantastic exhibition. And Matisse offered up some unexpected business lessons:

 “Each picture as I finish it, seems like the best thing I have ever done…. and yet after a while I am not so sure. It is like taking a train to Marseille. One knows where one wants to go. Each painting completed is like a station—just so much nearer the goal. The time comes when the painter is apt to feel he has at last arrived. Then, if he is honest, he realizes two things—either that he has not arrived at all or that Marseille… is not where he wanted to go anyway, and he must push farther on.” – Henri Matisse

The artist’s quote illuminates the business canvas. Like why we, and the organizations we create, are in a constant state of change, chaos, and renewal. Which helps me understand why I have never met a satisfied, successful CEO. Which helps me appreciate the best CEO’s I know who take extreme pleasure in the journey, including the ups and downs, and treat the achievement of a goal simply as a part of the process.

Successful enterprises, and the CEOs who run them, embrace as compatible equals both evolution and stability; they neither fear, nor overly celebrate, the moments of light and dark that ultimately lead to business excellence.

A contemporary artist of a different sort, Steve Jobs, said: “If you haven’t found it yet, keep looking. Don’t settle. As with all matters of the heart, you’ll know when you find it. And, like any great relationship, it just gets better and better as the years roll on.”

 

 

 

 

“A Fish Stinks from the Head”

I recently completed two very different planning sessions in two different parts of the country. While the geography doesn’t matter, the results do.

The first company (Company A) scheduled a two-day, off-site meeting at retreat center set in the woods. There was no internet access, we cooked our own food, and there was no alcohol (the business owner is a non-drinker). Since we were “down South” we enjoyed a nice December campfire. The owner included an interesting cross-section of his team consisting of all senior management, sales management, and a cross section of sales people. And lots of family members. The group was large and I was afraid it was going to be an unwieldy gang, given the diversity of the group and levels of responsibility. I was not optimistic about our chances of executing the plan.

Company A is an old company, mid-sized (over $50 million in revenue) with a lot of long-term employees and an inherent resistance to change. Their business model is not a whole lot different than it was 50 years ago: Drive around, look for customers, and drop in. They are successful, but not nearly as successful as they could be.

The second client (Company B) scheduled two one-day meetings, at the company offices outside of Chicago, with the senior team only. Although I prefer a two-day, off-site approach for the annual meeting, given the small group, I thought it would be a slam-dunk and that we may not even need the second day.

Company B is a much younger company, relatively small ($10 million in revenue) with no family members. They are in a rapidly changing industry. As a business, their job is to promote change in their customers’ organizations. And they are good at it. But their growth has stagnated, and they did not have a plan to accelerate their growth. They had never done any strategic or operational planning.

Both CEOs said they were committed to change. And both groups created and published a One-Page Strategic and Operational Plan.

It always amazes me how wrong I can be! In the first 90 days, Company A has already completed their quarterly goals (Rocks) in the first 60 days. This included changing the roles of a significant number of the meeting participants AND removing a few of the participants or their direct reports from the company. Company B, on the other hand, has not acted (yet) on any of their Rocks and has not even committed to the change they need. It begs the question, “Why is Company A executing on the plan while Company B is still in the starting gate?”

Well, as an old turnaround consultant friend of mine used to say, “John, a fish stinks from the head!” The first time he said that, I must of given him a look, because he followed up with “And, John, you’re the fish!” It’s pretty clear that in the two examples here, the CEO of Company A did an excellent job of selecting his team, creating the case for changes, and then becoming laser-focused on executing the change. Our CEO for Company B intellectually knows he has a need to change, but he has not committed himself to all of the tough decisions that must be made.

There is no question that change is difficult. But if you are going to get your organization to the next level, it starts with the CEO. Remember, “A fish stinks from the head.”