Managing People - cb.hbsp. · PDF fileConsider this your hip-pocket guide to people management. ... work style, and values, how ... General Motors CEO Alfred Sloan’s legendary mastery

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The HMU Guide to Managing People

Consider this your hip-pocket guide to people management. We chose these articles with one

clear goal in mind: to provide you with a comprehensive yet concise resource for dealing with

the most common issues you encounter when managing people.

You will not find a chapter here that’s much longer than 1,500 words or requires more than

10 minutes of your time. Though we can’t help you solve all your problems that quickly, we can

help you better think about how to solve those problems.

You may choose to use this publication as an occasional resource, something to turn to

from time to time for targeted advice. Or you may choose to read this collection from start to

finish. Whichever way you decide to use this collection, an explanation of how we’ve organized

it will help you get the most from it.

The HMU Guide to Managing People begins with two Harvard Business Review OnPoints

from Peter Drucker, perhaps the most revered management thinker of our time. We present

these distillations at the outset with your development in mind—after all, it’s difficult to

manage others if you haven’t yet found the most effective way to manage yourself.

From there, we move into a set of five “Debriefings” taken from the pages of Harvard

Management Update. Each offers an expert’s point-by-point guidance on navigating some of

the trickiest terrain in people management.

The largest group of articles follows. Here, the focus is on tactics—how to align your team

behind strategy, motivate problem people, foster the development and sharing of ideas, provide

effective recognition and reward, and more.

The final few articles are geared toward helping you become a better and more effective

executive. In this section, you’ll find advice on how to delegate more efficiently, resist the urge to

overreach, and become more persuasive.

We hope you find this collection useful, and we invite your comments and suggestions for

future editions.

Sincerely,

Paul Michelman

Editor

Harvard Management Update

The HMU Guide to Managing People

Contents

Managing Yourself

Managing Oneself 2

What Makes an Effective Executive 3

Debriefing the Experts

What Leaders Must Provide 6

Breaking Up Corporate Fiefdoms 8

Make Conflict Drive Results 10

Exerting Influence Without Authority 12

What Gets Things Done 14

Tactics

Turning Great Strategy into Great Performance 18

How Will You Turn Top-Level Strategy into Unit-Level Action? 19

How Will You Better Align with Strategy? 20

How Will You Maintain Alignment? 21

How Great Managers Manage People 22

Five Questions About . . . Employee Recognition and Reward 23

How Will You Make Your Team a Team? 24

Five Questions About . . . How to Get People Involved 25

Building and Leading Your Team 26

Five Questions About . . . Getting Teams Unstuck 27

Five Questions About . . . How to Energize Colleagues 28

Overcoming Change Resisters 29

How to Motivate Your Problem People 30

The Set-Up-to-Fail Syndrome 31

Will You Help or Heave Your Underperformers? 32

Tap Into the Power of Accountability 33

Making Idea Sharing Pay Off 34

Five Questions About . . . Getting the Best Employee Ideas 36

Manage Your Human Sigma 37

Resist the Urge to Overreach—and Win Back Valuable Time 38

Five Questions About . . . Encouraging Managers to Delegate 39

Change the Way You Persuade 40

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Managing Yourself

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Managing Oneself

The Idea in Brief The Idea in Practice

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We live in an age of unprecedented oppor-tunity: If you’ve got ambition, drive, and smarts, you can rise to the top of your cho-sen profession—regardless of where you started out. But with opportunity comes re-sponsibility. Companies today aren’t man-aging their knowledge workers’ careers. Rather, we must each be our own chief ex-ecutive officer.

Simply put, it’s up to you to carve out your place in the work world and know when to change course. And it’s up to you to keep yourself engaged and productive during a work life that may span some 50 years.

To do all of these things well, you’ll need to cultivate a deep understanding of yourself. What are your most valuable strengths and most dangerous weaknesses? Equally im-portant, how do you learn and work with others? What are your most deeply held val-ues? And in what type of work environment can you make the greatest contribution?

The implication is clear: Only when you op-erate from a combination of your strengths and self-knowledge can you achieve true—and lasting—excellence.

To build a life of excellence, begin by asking yourself these questions:

“What are my strengths?”

To accurately identify your strengths, use

feedback analysis

. Every time you make a key decision, write down the outcome you ex-pect. Several months later, compare the actual results with your expected results. Look for patterns in what you’re seeing: What results are you skilled at generating? What abilities do you need to enhance in order to get the re-sults you want? What unproductive habits are preventing you from creating the outcomes you desire? In identifying opportunities for im-provement, don’t waste time cultivating skill areas where you have little competence. In-stead, concentrate on—and build on—your strengths.

“How do I work?”

In what ways do you work best? Do you pro-cess information most effectively by reading it, or by hearing others discuss it? Do you accomplish the most by working with other people, or by working alone? Do you per-form best while making decisions, or while advising others on key matters? Are you in top form when things get stressful, or do you function optimally in a highly predict-able environment?

“What are my values?”

What are your ethics? What do you see as your most important responsibilities for living a worthy, ethical life? Do your organization’s ethics resonate with your own values? If not, your career will likely be marked by frustration and poor performance.

“Where do I belong?”

Consider your strengths, preferred work style, and values. Based on these qualities, in what kind of work environment would you fit in best? Find the perfect fit, and you’ll transform yourself from a merely acceptable employee into a star performer.

“What can I contribute?”

In earlier eras, companies told businesspeople what their contribution should be. Today, you have choices. To decide how you can best en-hance your organization’s performance, first ask what the situation requires. Based on your strengths, work style, and values, how might you make the greatest contribution to your organization’s efforts?

.

2

by Peter F. Drucker

What Makes an Effective Executive


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Worried that you’re not a born leader? That you lack charisma, the right talents, or some other secret ingredient? No need: leader-ship isn’t about personality or talent. In fact, the best leaders exhibit wildly different per-sonalities, attitudes, values, and strengths—they’re extroverted or reclusive, easygoing or controlling, generous or parsimonious, numbers or vision oriented.

So what do effective leaders have in com-mon? They get the right things done, in the right ways—by following eight simple rules:

•

Ask what needs to be done.

•

Ask what’s right for the enterprise.

•

Develop action plans.

•

Take responsibility for decisions.

•

Take responsibility for communicating.

•

Focus on opportunities, not problems.

•

Run productive meetings.

•

Think and say “We,” not “I.”

Using discipline to apply these rules, you gain the knowledge you need to make smart decisions, convert that knowledge into effective action, and ensure account-ability throughout your organization.

GET THE KNOWLEDGE YOU NEED

Ask what needs to be done.

When Jack Welch asked this question while taking over as CEO at General Electric, he real-ized that dropping GE businesses that couldn’t be first or second in their industries was essential—not the overseas expansion he had wanted to launch. Once you know what must be done, identify tasks you’re best at, concentrating on one at a time. After com-pleting a task, reset priorities based on new realities.

Ask what’s right for the enterprise.

Don’t agonize over what’s best for owners, in-vestors, employees, or customers. Decisions that are right for your

enterprise

are ultimately right for all stakeholders.

CONVERT YOUR KNOWLEDGE INTO ACTION

Develop action plans.

Devise plans that specify

desired results

and

constraints

(is the course of action legal and compatible with the company’s mission, val-ues, and policies?). Include

check-in points

and

implications for how you’ll spend your time

. And

revise

plans to reflect new opportunities.

Take responsibility for decisions.

Ensure that each decision specifies who’s ac-countable for carrying it out, when it must be implemented, who’ll be affected by it, and who must be informed. Regularly review deci-sions, especially hires and promotions. This enables you to correct poor decisions before doing real damage.

Take responsibility for communicating.

Get input from superiors, subordinates, and peers on your action plans. Let each know what information you need to get the job done. Pay equal attention to peers’ and supe-riors’ information needs.

Focus on opportunities, not problems.

You get results by exploiting opportunities, not solving problems. Identify changes inside and outside your organization (new technolo-

gies, product innovations, new market struc-tures), asking “How can we exploit this change to benefit our enterprise?” Then match your best people with the best opportunities.

ENSURE COMPANYWIDE ACCOUNTABILITY

Run productive meetings.

Articulate each meeting’s purpose (Making an announcement? Delivering a report?). Termi-nate the meeting once the purpose is accom-plished. Follow up with short communica-tions summarizing the discussion, spelling out new work assignments and deadlines for completing them. General Motors CEO Alfred Sloan’s legendary mastery of meeting follow-up helped secure GM’s industry dominance in the mid-twentieth century.

Think and say “We,” not “I.”

Your authority comes from your organization’s trust in you. To get the best results, always consider your organization’s needs and op-portunities before your own.

by Peter F. Drucker

3


Debriefingthe Experts

Copyright © 2005 by Harvard Business School Publishing Corporation. All rights reserved.

ood leaders have to be pas-sionate, the common wis-dom goes. They must excel at

public speaking, have brilliant minds for strategy, and possess the common touch with followers. Not true, insists Marcus Buckingham, author of

The One Thing You Need to Know… About Great Managing, Great Leading, and Sustained Individ-ual Success

(The Free Press, 2005). Leaders don’t necessarily have to demonstrate any of these qualities. Far more important is their ability to provide followers with clarity—about whom they’re serving, what will enable them to best rivals, how their performance will be measured, and which actions will help them meet their goals.

The need for such clarity has never been greater, says Buckingham. Vague visions and mission state-ments and long lists of performance metrics have left employees unsure where to focus. But when leaders present a clear vision of their unit’s or company’s desired future and their plan for getting there, they replace employees’ anxiety with confidence and their uncertainty with resilience and creativity.

Four points of clarity

Buckingham, a former Gallup con-sultant and coauthor of

First, Break All the Rules: What the World’s Great-est Managers Do Differently

(Simon & Schuster, 1999) and

Now, Discover Your Strengths

(The Free Press, 2001), defines four points of clarity that

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leaders must lay out—in concise, vivid terms—for their followers. These ideas collectively outline a group’s desired state and a plan for making it real.

1. Whom do we serve?

Who are your customers? How can you define them in vivid terms? Doug Degn, who oversees Wal-Mart’s food merchandising, defines his team’s customers as “people who live paycheck to paycheck.”

Each Best Buy store serves differ-ent customers. For some stores, they are soccer moms who want a store that’s “easy to navigate with [their] kids,” writes Buckingham. For other stores, it’s “independent busi-ness people who want to use technol-ogy to manage their business more effectively.”

In developing

your

answer, don’t define your customers through data based on income levels or spending habits. “Define them based on what they want or need from you,” Buck-ingham says. To provide an example of how

not

to define your customers, he cites one large retail bank’s an-swer: “We serve people who have $500,000 and more in invested as-sets.” Note the difference between this definition and Wal-Mart’s or Best Buy’s: the bank’s definition fails to put a human face on its customers.

To develop ideas for defining your customers with laser-sharp clarity, gather some of your best customers together. Ask them questions such as,

“What are the best service experi-ences you’ve had with our team?” and “What do you get from us that has real value for you?” Also ask your best frontline employees to offer stories of successful customer service experiences.

Finally, draw on your own experi-ence. For instance, Sir Terry Leahy, the head of successful British retailer Tesco, identified his company’s cus-tomer as the hurried housewife or working mother based in part on his childhood. From a working-class neighborhood, Leahy always felt annoyed that his mother and her friends never got any respect when they went shopping. And so he envi-sioned a business that would serve such neglected customers.

Pulling all the above information together, craft a vivid customer definition—one that lets your employees visualize that customer and understand her concerns and passions.

2. What is our core strength?

Does your division, unit, or team excel at partnering with other groups in the company? At delivering virtu-ally error-free service? At spotting opportunities that others can’t see? By defining your core strength, Buckingham maintains, you tell your employees why they will prevail in the future—how they’ll use their edge to beat the many competitors and surmount the numerous obsta-cles out there. You therefore replace their anxiety about the future with confidence and resilience.

“There’s no right or wrong answer to the question of what your core strength is,” says Buckingham. “There are so many truths, and so many plausible directions to take.” Of course, you’ll use your knowledge of the competitive arena and your company’s high-level strategy to de-fine core strengths. But many leaders

Debriefing Marcus Buckingham

Author,

The One Thing You Need to Know

What Leaders Must Provide

by Lauren Keller Johnson

6

What Leaders Must Provide

(continued)

harvard management update

May 2005

also call on their intense responses to profound experiences. For example, Buckingham says, a fatal mining acci-dent impelled the president of Rio Tinto Borax, a division of major in-ternational mining company Rio Tinto, to decree that the division’s strength, from that point on, would be its safety record.

It’s essential that your followers believe that

you

believe they can excel in the

ways you’ve defined.

Buckingham cites the Rio Tinto story as evidence that “the strengths you pick don’t have to reflect current reality. You don’t have to be right. You just have to be clear.” The crucial thing is to select a strength that paints a compelling vision of a better future that you can envision and articulate for your group. It’s also essential that your followers believe that

you

believe they can excel in the ways you’ve defined.

3. What is our core score?

To evaluate your group’s perfor-mance, you may be tempted to define five, 10, or 20 metrics assessing nu-merous performance dimensions. That’s fine, says Buckingham, but don’t communicate all of them to your employees.

Instead, present your employees with one metric with which they can track their progress. Ensure that be-haviors defined by the metric fall under your employees’ control—they must be able to do something about the score.

Buckingham again argues that there’s no one “right” answer to this question. However, he does recom-mend selecting a metric that fits

who your unit’s customer is or that quantifies the group’s core strength. For instance, Rio Tinto’s core score became the number of “lost-time injuries.”

4. What can we do now?

Every effective leader whom Buck-ingham has observed excels at using two types of action to model desired behavior and inspire followers: “Symbolic action” grabs employees’ attention and shows them the kind of better future you have in mind. For example, former New York mayor Rudy Giuliani’s eradication of all graffiti on city buses and subway cars revealed that he “was a leader who could get things done,” says Buckingham.

“Systematic action,” by contrast, “interrupts our day-to-day routines and forces us to become involved in new activities” that are needed to serve customers, leverage core strengths, and deliver top-notch performance on core metrics. Buck-ingham cites Giuliani’s CompStat initiative as an example.

The mayor had selected crime statistics as his city’s core score. Through the CompStat initiative, Giuliani required more than 100 se-nior police officers to gather twice a week to share crime data and identify ideas for addressing troubling pat-terns. This systematic action caused the officers to “change their comfort-able routines and engage in unam-biguously new behaviors.”

Embedding clarity

The process of embedding clarity in your day-to-day operations takes a certain mindset and a lot of discipline. You have to be willing to “close a lot of doors” by selecting highly specific answers to the clarify-ing questions and constantly com-

municating them to your followers.

“Providing clarity isn’t about ra-tional analysis and cohesiveness in your message,” says Buckingham. In fact, “the more doors of explanation you open, the more confused your people will get.”

You also need a healthy dose of op-timism and ego—and the conviction that you can make that better future come true. And while Buckingham believes that the ability to provide clarity is, in some respects, an innate talent, he also maintains that some straightforward practices can help a manager hone this talent.

For example, take time for reflec-tion, and follow routines that enable you to “think about success.” Ask yourself questions such as: Why is this operation doing much better than the others? Why are these cus-tomers so much more loyal than the rest? Why is this management team so much more resilient and persistent than my other teams? Understanding why something succeeded, says Buckingham, can be far more power-ful than understanding why some-thing failed.

Also select and publicly recognize your “heroes”—your high-performing employees—carefully. If you want to predict the future behavior of a company or group, Buckingham maintains, “look to the people and the events it chooses to revere.” Whenever you praise a high-achieving employee in front of colleagues, explain in specific terms precisely how he served your defined customer, what core strength he demonstrated, how he met or exceeded your core metric, and what symbolic and systematic actions he took to bring your desired future even closer.

◆

7


t’s an old, troubling story: Indi-viduals or groups within an or-ganization—feeling the need to

safeguard their jobs or secure their successful position in the company—set out to make themselves indis-pensable. They move to protect their turf and seize control over what work gets done and how it gets done. Moreover, they lay claim to increas-ing quantities of resources—person-nel, technologies, budgets—in a relentless drive to amass power. In short, they create fiefdoms.

Based on deep-seated human needs—to control the information that reflects on our work, to deter-mine our own destiny, and to be seen as vital to our organizations—fief-doms arise in all types of organiza-tions. They also crop up at every level of the company—individual, team, department, division, and subsidiary. And they inflict severe damage.

For one thing, fiefdoms stifle cre-ativity because the people ruling them resist new ideas in order to maintain their positions. In addition, fiefdoms spawn confusion by creat-ing processes (such as separate finan-cial reporting procedures) that conflict with those established by the company.

The confusion worsens when fief-dom rulers present only carefully se-lected information about what’s going on in their area so as to make themselves look good. Finally, fief-doms drain vital resources from parts of the organization that really need them. Left intact, a fiefdom can even

I

take down an entire company—just look at Enron.

For these reasons, leaders must take prompt, decisive steps to break up fiefdoms. Though most fiefdom rulers will fight attempts to fragment their turf, executives and managers can succeed in this effort—if they ap-proach the process with determina-tion and discipline.

Left intact, a fiefdom can even take down an entire company—

just look at Enron.

How can you best shatter the fief-doms proliferating in your company? According to Bob Herbold, former COO of Microsoft and author of

The Fiefdom Syndrome

(Currency/Doubleday, 2004), you need to strike a delicate balance. Specifically, you must restore discipline across the or-ganization while reviving fiefdom in-habitants’ ability and willingness to generate creative ideas for solving problems and satisfying customers.

Restoring discipline

On the discipline side of the fiefdom-busting equation, Herbold recom-mends specific

process

,

behavior

, and

people

practices. These practices are designed to make what’s going on in your company visible throughout the organization, center procedural con-trols in one place, and stir up work-place relationships. The overarching goal? To restore discipline in pro-

cesses and structures that stretch across the whole company.

Here’s what Herbold considers among the most potent disciplines:

Process: the discipline of creating lean global processes and accessible data companywide.

Streamline your company’s reporting systems so that everyone in the organization can easily access and understand data about the company’s financial per-formance, employees’ on-the-job performance, and so forth.

For example, use standardized scales on performance-evaluation forms. And reduce the number of re-ports to the minimum necessary to convey needed information. “At Mi-crosoft,” Herbold says, “we had just 12 charts that answered 98% of all questions about the company’s finan-cial performance. Those charts al-ways had the same format and were available on servers in the company’s headquarters.”

Behavior: the discipline of avoid-ing fragmentation.

Ensure that in-formation technology, human re-sources, procurement, public relations, and other shared-service departments do not become dupli-cated in units across your organiza-tion. As Herbold points out, business units often strive to de-velop their own departments in order to operate as independently as possible. Not surprisingly, such fragmentation increases costs and creates massive replication.

To illustrate, consider what hap-pens when procurement is dispersed throughout an organization. In one successful, financially secure com-pany, Herbold explains, a major ven-dor sent a letter to headquarters asserting that the firm must be “going under” because it hadn’t paid the vendor’s bills for six months. The rea-son for the confusion? Any group

Debriefing Bob Herbold

Former COO, Microsoft

Breaking Up Corporate Fiefdoms


8

Corporate Fiefdoms

(continued)


December 2004

could procure resources it needed simply by contacting vendors of their choice whenever they wanted. And the company had no central system for handling procurement and pay-ment on an ongoing basis.

People: the discipline of person-nel rotation.

Move people in and out of a team, department, or divi-sion to prevent a fiefdom from form-ing in the first place or to break up a fiefdom that has begun to take shape. As Herbold explains, when individu-als are left in one place in an organi-zation for many years, the company becomes reluctant to move them—even if they would make a better con-tribution elsewhere.

Fiefdoms arise based on long-standing members’ expertise or se-niority. Results? Missed opportuni-ties and antiquated approaches as the skills and ambitions of the fiefdom’s inhabitants atrophy.

To avoid this scenario, Herbold recommends rotating valued em-ployees among different assignments to give them a broad variety of expe-riences. “If a hotshot knows he’s going to be part of the marketing group for just two years,” Herbold says, “he’s not going to let himself get pulled into and absorbed by a fief-dom. He’d much rather make a posi-tive impact during his short time there.”

Reviving creativity

In addition to restoring discipline across their organizations, leaders must revive creative thinking among employees in order to break up fief-doms. “You want your people to be spending their time thinking up bright ideas for pleasing customers,” Herbold says, “not finding ways to please their boss or advocating for their own position in the company.”

Periodically making a particular group responsible for a product or service area that is unfamiliar to them is one way to stimulate creative thinking. “Deep experience in a par-ticular business area is massively overvalued,” Herbold maintains. “Most smart people need just three or four months to grasp their respon-sibilities and start generating great new ideas. It’s important to send the message that ‘You’re not going to be doing the same things you did when you first came here.’”

Another way to foster creative thinking is to remove the “layers of wisdom” through which a good idea must navigate to get implemented. In Herbold’s words, “When a person’s boss, the boss’s boss, and so on insist on approving every idea, they tinker with the idea and change it. That saps the creativity of the person who thought up the idea. The individual feels that he or she is not the owner of the idea and thinks, ‘Why should I bother?’”

Instead of requiring good ideas to wend their way through layers of wis-dom, Herbold advises, “let people

BATTLING YOUR OWN DESIRE FOR A FIEFDOM

Because the human needs that fuel fiefdom formation are so powerful,we’re all susceptible to the desire to create and rule one. Bob Herbold offersseveral suggestions for combating this urge:

•

Be objective about your contribution to the company.

In an unbiased way, assess what you’re doing well and what you’re not doing well. Watch for incomplete or slanted data about your performance.

•

Examine your behavior regarding resources.

If you’re always solving problems by asking for more resources, you may be a budding fiefdom-ruler. Instead, ask yourself, “Are my current resources working for me as they should? Am I getting the most from them?” Often, you can squeeze more from existing resources than you initially believed.

•

Adopt an attitude of constant improvement.

Anticipate and develop solutions to problems instead of trumpeting your successes. Objec-tively assess the issues facing your team, department, or company.

know that you’re there as a resource. Say, ‘I’m here; if you think I can add something to your idea, come see me. I’m not the decision maker for your idea—you are. Bring me the results of your idea, and we’ll see how well you did.’” Herbold continues: “When people know there’s no one hovering around them, they do a better, more thorough job.”

Of course, employees aren’t always going to generate good results from implementing their ideas. But when they bring their results to their boss, the two can discuss what happened. The boss can say, “What did you learn from this experience?” In Herbold’s view, employees climb the learning curve a lot faster when managers use this approach.

In organizational life, people will always yearn to carve out and rule fiefdoms. But by systematically breaking up nascent or advanced fief-doms through a balance of organiza-tional discipline and individual creativity, leaders can stave off the havoc that fiefdoms cause.

◆

9


erhaps you’ve witnessed it: two managers in your organi-zation go head to head in a

grab for power, position, or pay. The conflict seeps down into the depart-ments they oversee, as teams become aware of the contest and start backing their respective leaders. Soon com-munication and collaboration be-tween the opposing departments break down.

This scenario represents a particu-larly destructive brand of conflict, says Michael Feiner, a professor at Columbia University’s Graduate School of Business. In other “un-healthy” forms of conflict, employees jockey for favor with the boss, people argue over how they’re being treated by the firm, and individuals sabotage one another’s professional reputa-tions to advance their own careers.

Whatever shape unhealthy con-flict takes, it always wreaks the same kind of havoc: it saps people’s con-centration and focus, and drains much-needed attention and energy away from the issues that matter most to the organization overall. It also gives conflict a bad name. Execu-tives and managers conclude that all conflict is unhealthy and should be squelched.

But not all conflict is destructive, says Feiner. “Contests over personal agendas are unhealthy, but conflicts over ideas are good.” In fact, he says, skilled leaders purposefully encour-age debate, disagreement, and dis-cussion over ideas, issues, and important decisions. “The higher the

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stakes in a key decision, the more vital it is to stimulate this healthy kind of conflict.” Battles over ideas, Feiner says, “lead to creativity, innovation, and positive change by squeezing the best ideas from each participant’s mind.”

The most effective executives know how to minimize the bad con-flict while cultivating the good. This balancing act begins by developing a new mindset regarding conflict.

Avoiding a corporate coronary

To develop the right attitude for “leading conflict,” managers should think of conflict as cholesterol, Feiner says. “Once you compare the negative impact of bad cholesterol on your health with the benefits of good cho-lesterol, you’ll likely feel more moti-vated to change the way you’re doing things. You adopt whatever discipline and practices—new fitness or dietary regimens—you need to reduce the bad kind and increase the good kind.”

Similarly, leaders who are able to recognize the downside of unhealthy conflict and the upside of healthy conflict are better able to manipulate the levels of both varieties. “You save your company from having a corpo-rate coronary,” Feiner says.

Handling conflict deftly entails a new attitude toward leadership. “Relying on your power to push peo-ple into following you only generates destructive conflict,” Feiner says, “because people feel bullied into complying. You want their commit-ment, not their compliance. You

want to pull people—take them with you—not push them. And you need to respect the interdependence inher-ent in workplace relationships.” Managers can begin adopting this new mindset about leadership by asking themselves a simple question: Does the behavior of the people around me suggest that I’m pulling people—or pushing them?

But this alone won’t generate effective conflict leadership. Execu-tives must also master the two sets of skills needed to manage each type of conflict.

Minimizing bad conflict

When unhealthy conflict rears its head, many executives don’t realize they have a range of options for deal-ing with the situation. Instead, they assume that they have two choices at most: avoiding the conflict or con-fronting one or more of the parties.

To be sure, each of these responses may have merit under specific condi-tions. For example, a manager may decide that it’s best to ignore an inter-personal conflict between two mem-bers of her team if she believes that the problem will eventually blow over without causing lasting damage.

But under other circumstances, it may be more appropriate to use con-frontation to defuse a destructive conflict. For instance, Feiner suggests that “if you see two people from dif-ferent departments locking horns over money or power, you’ll be doing them and your company a favor if you confront one or both of them. Point out that the conflict isn’t just bad for the business—it’s destructive to the person’s credibility and career. If handled delicately, this can be enough to persuade people to set their personal agendas aside.”

Of course, such conversations can be tricky. Feiner recommends adapting your delivery style to the person you’re confronting and em-

Debriefing Michael Feiner

Author,

The Feiner Points of Leadership

(Warner Business, 2004)

Make Conflict Drive Results


10

Make Conflict Drive Results

(continued)


September 2004

phasizing his interests over the company’s interests.

Executives and managers can minimize bad conflict even more skillfully, Feiner says, if they develop options beyond avoidance and con-frontation. In

The Feiner Points of Leadership: The 50 Basic Laws That Will Make People Want to Perform Better for You

(Warner Business, 2004), he suggests several additional responses:

Compromise.

Find a fair solu-tion that satisfies both parties. For example, your company’s marketing executive wants to launch a new product on September 1, but the manufacturing executive (who has had long-standing disagreements with the marketing executive) argues for November 1. You encourage them to agree to October 1.

Delegation.

Ask a subordinate with a strong track record of conflict resolution to address the problem on your behalf. This sends the message that not every contest should escalate up the corporate ladder.

Collaboration.

Encourage the parties to openly discuss their dis-agreement and determine a solu-tion—jointly. Start the conversation by acknowledging that the parties have different viewpoints. Then ease intense emotions by guiding the dis-cussion toward an assessment of the facts—through questions such as “What additional data can we bring in to arrive at the best solution?”

Be open about the damage the con-flict is causing: “Your differences have created a civil war in the company. How can we resolve this dispute for your own good and the good of the organization?” This option takes time, but it produces the most enduring results.

Accommodation.

Encourage one of the parties to “give in for the

sake of keeping the peace.” This option can be most useful if main-taining the relationship between the parties is essential and the dispute doesn’t seriously jeopardize the organization.

The central point about options, Feiner says, is that the more of them you know how to use, the more flexi-bility you have in resolving unhealthy conflicts. “When you become aware of a bad conflict,” Feiner notes, “sim-ply asking ‘What are my options?’ can reveal the most appropriate way of responding.

“Notice if you’re relying on just one or two options most of the time. If you are, learn how to use the other options. You want a variety of pitches to draw from.”

Maximizing good conflict

In Feiner’s view, the key to healthy conflict is the energetic exchange of ideas. Leaders have numerous techniques at their disposal for stimulating “good cholesterol” debate and disagreement. For example, Feiner encourages execu-tives and managers to avoid stating their opinion on an issue early in a discussion. “You’ll only encourage groupthink,” he says, “because few people will feel comfortable challenging you. Instead, make sure your opinion is the last one

LIVING WITH CONFLICT

Every social system experiences good and bad conflict, Feiner says—andorganizations are no exception. “People have always been ambitious andachievement-oriented. These days, the increasing pressure to generate bet-ter business results and satisfy Wall Street may be pushing more people toput their own interests over those of their organization. But overall, conflicthas been a constant in business life.” The best leaders don’t set out tosquelch all conflict. Instead, they understand the difference betweenhealthy and unhealthy conflict and seek to tip the scales toward the goodvariety. They develop a broad repertoire of options for minimizing destruc-tive conflict. At the same time, they encourage people to check their per-sonal agendas at the door—and argue about ideas instead.

stated.”Another technique involves notic-

ing when one or more participants in the debate have fallen silent. “When you see that happening, ask the per-son what he or she is thinking and feeling.” Feiner also agrees that desig-nating someone to play devil’s advo-cate on an issue can further stimulate a lively or even heated exchange of ideas.

Feiner describes another method known as divergence/convergence: participants privately write on Post-it notes what they consider to be the three key issues in the decision at hand. The notes are arrayed on the wall to reveal where consensus and dissent exist. Through debate and discussion based on the notes, partic-ipants then work toward a conver-gence of opinion. This approach helps ensure that everyone’s ideas are included in the decision process.

Such techniques enable a leader to send an important message: “I want your ideas. I want your disagreement. I want you to challenge me.” The re-sulting interaction of ideas provides the foundation for the innovative, creative thinking that healthy conflict generates.

◆

11


Congratulations—you’ve beenasked to lead a change initia-tive! But there’s a catch—its

success hinges on the cooperation ofseveral people across your organiza-tion over whom you have no formalauthority.

If you’re like most managers,you’re facing this sort of challengemore often these days because of flat-ter management structures, out-sourcing, and virtual teams. Forthose reasons, a greater number ofmanagers now need to get thingsdone through peers inside and out-side their organizations. In this age ofheightened business complexity,moreover, change itself has grownincreasingly complicated. A majorityof change initiatives now involvemultiple functions within and evenbetween companies, and many suchefforts encompass an entire firm.

New kinds of partnerships andalliances have emerged as well, andthey require managers to exerciseinfluence over peers from the othercompanies. Santa Clara, Calif.–basedApplied Materials, for example, has800 engineers and other employeesworking inside Intel, collaboratingdaily with their Intel partners todevelop successful new products.

In such circumstances, command-and-control leadership—the “Ileader, you follower” approach—doesn’t get a manager very far. Jay A.Conger, professor of organizationalbehavior at the London BusinessSchool and formerly the executivedirector of the University of South-

ern California’s Leadership Institute,points out that managers and execu-tives at all levels must use a more lat-eral style of leadership.

Why lateral leadership?Lateral leadership, Conger maintains,counts among a manager’s mostessential skills, and comprises a con-stellation of capabilities—from net-working and coalition building topersuading and negotiating.

Though honing these skills takestime and patience, the payoff is worthit. That initiative you’re championingwill stand a far better chance of beingimplemented quickly.You’ll gainaccess to the resources you need tocarry out the effort.You’ll see doorsswing open freely to the key playerswhose cooperation you need most.And perhaps most important, you’llachieve the central purpose of mana-gerial work: getting things donethrough other people—and catalyzingvaluable change for your organization.

A constellation of capabilitiesSo how do you begin mastering theskills that constitute lateral leader-ship? Conger recommends focusingon four closely interconnected andmutually reinforcing capabilities:

Networking. Cultivate a broadnetwork of relationships with thepeople inside and outside your com-pany whose support you need tocarry out your initiatives. If network-ing doesn’t come naturally to you,create a personal discipline through

which to acquire this capability. Con-ger maintains that “certain people areportals to other people—they canconnect you to more and bigger net-works. You need to build relation-ships with these individuals inparticular.”

Constructive persuasion and negotiation. Too many man-agers, Conger says, wrongly view per-suasion and negotiation as tools formanipulation. But conducted withan eye toward mutual benefit, theycan vastly enhance your influence.

To make persuasion and negoti-ation constructive rather thanmanipulative, view the person you’redealing with as a peer instead of a“target.” Take courses and read bookson these subjects to hone your skills.And find a seasoned colleague withinthe company who can serve as a con-fidant and brainstorming partner.

Consultation. Take time to visitthe people whose buy-in you need.Ask their opinions about the initia-tive you’re championing. Get theirideas as well as their reactions to your ideas.

Too many managers, Conger says,rush to define a series of steps thatthey believe constitutes the right way to carry out their initiative.They then circulate around the com-pany and try to impose their solutionon others—mistakenly believing that they’re engaging in productiveconsultation.

The result? Resistance and bicker-ing over process details.“You’ll get farbetter results,” Conger says,“if youcommit to and advocate the desiredoutcome but invite peers to partici-pate in defining the process forachieving that outcome.”

Coalition building. It’s a fact ofhuman nature that several peoplewho are collectively advocating an

Debriefing Jay CongerProfessor of Organizational Behavior at London Business School

Exerting Influence Without Authorityby Lauren Keller Johnson

12

Exerting Influence Without Authority (continued)

harvard management update December 2003

idea exert more influence than a loneproponent. For this reason, coalitionbuilding plays a vital role in lateralleadership. By building coalitions,Conger explains, you gather influen-tial people together to form “a singlebody of authority.”

To assemble a powerful coalition,begin by asking yourself who’s mostlikely to be affected by the changeyou’re proposing. Whose “blessing”do you need—whether in the form ofpolitical support or access to impor-tant resources or individuals? Whosebuy-in is crucial to your initiative’ssuccess?

The challenges of lateralleadershipThough lateral leadership consists ofseveral concrete, interrelated skills,many managers cannot easily masterthose capabilities. For one thing,Conger points out, they’re often sofocused on their own functional silothat they don’t know who beyondtheir own internal group should beincluded in their networking andcoalition-building efforts.

To combat this “functional focus,”take time to find out who makesthings happen in your organization.Whom do people go to for adviceand support? And who tends tothrow up roadblocks to new ideasand changes? You won’t find theanswers to these questions in theorganizational chart. As Conger says,you gain a sense of these thingsthrough informal contact and casualget-togethers with colleaguesthroughout the company.

In addition to focusing too closelyon their own function, managersexperience intense pressure to grap-ple with what they see as responsibil-ities more urgent than buildingrelationships. After all, many of themare rewarded for producing concrete,short-term results, Conger notes,

whereas investments in lateral-leadership “capital” can take time and patience—and often the divi-dends don’t come until much later.

So how do you reconcile the needto produce in the short run with theequally important need to lay thegroundwork for productive collabo-ration in the long run? Conger rec-ommends dedicating a specificamount of time each day or week tosharpening your lateral leadershipskills. For example, commit to having

lunch each Thursday with a differentperson inside or outside your organi-zation whom you don’t know wellbut who may play an important rolein a project you’ll be leading.

Conger also recommends gettingto know influential people beforestarting to work with them on a proj-ect. For instance, suppose you’ll beleading a project that will involvemanagers from several other func-tions and you’ve scheduled a formalkick-off meeting in a month. Seekout those managers in the weeksleading up to the meeting and askthem for their thoughts about theupcoming project.

Creating the right environmentConsidering the increasing need forlateral leadership—and its unmistak-able benefits—you might assumethat companies are moving energeti-cally to train managers in this impor-tant area. But, Conger notes, that isn’tthe case.

To be sure, many firms offercourses on influence, circulate arti-cles on various aspects of lateral lead-

ership, and establish mentoring pro-grams designed to help managersidentify and access “portals” quickly.But formal training and mentoringefforts can have mixed results, Con-ger warns.

Why? “Successful lateral leader-ship grows out of positive chemistrybetween people. You can’t predict orcontrol the natural affinity peoplehave for one another—that glue thatmakes relationships of mutual influ-ence possible.”

Rather than “matching people up”through a formal mentoring program,companies have far more success bycreating opportunities for people tomingle—and then letting them forgementoring and networking relation-ships on their own. Conferences, sem-inars, and company-sponsored socialevents provide opportunities for peo-ple to get to know peers with whomthey might not otherwise interact.

Chemistry becomes even moreimportant, Conger adds, in virtualteams. In these increasingly commonwork groups, members have fewchances to meet face to face andengage in the “sizing up”that humansdo instinctively.Without these non-verbal exchanges, people can’t buildthe trust that makes lateral leadershippossible. Thus, people on virtualteams must be particularly intentionalabout their networking. Face-to-facemeetings—even if they require expen-sive travel—are often well worth thecost. Lunches, coffees, and othercasual social gatherings can furthercement working relationships.

As the business landscape contin-ues to shift, companies will needmanagers who can exercise lateralleadership with increasing skill andconfidence. But because many firmsstill don’t invest explicitly in cultivat-ing this talent throughout theirworkforces, managers would do wellto take the initiative themselves. �

Find out who

makes things happen

in your organization.

13


ou have been charged with implementing a significant new initiative. Perhaps your

company has defined a new competi-tive strategy—such as cutting costs, entering new markets, or going global—and you need to align your group behind it. Or maybe you’ve identified stubborn problems in your unit—order-processing mistakes, duplication of efforts, budget over-runs—that need solving.

Your goal may be clear, but how clear is your strategy for reaching it? If you’re like most executives, the answer is, Not clear enough.

Indeed, most major change initia-tives fail, many of them soon after implementation begins, says Larry Bossidy, coauthor with Ram Charan of

Confronting Reality: Doing What Matters to Get Things Right

(Crown Business, 2004). The reason? Execu-tives commit one or more of several common errors, all of which stem from insufficient planning and follow-through.

Some leaders assume that their unit’s culture has the flexibility and openness required to accommodate major change. They ram the initiative through their group—only to en-counter stiff resistance that ulti-mately sabotages the effort. Or they fail to articulate the initiative’s bene-fits. “If people don’t understand the purpose of an initiative,” Bossidy says, “they’ll be skeptical about de-voting their time and energy to it.”

Y

Some leaders also don’t realize they must stay involved during im-plementation and continually com-municate the initiative’s importance. “They just announce it and walk away,” Bossidy says. The result is initiatives that do little other than “wander and drift.”

Executives who want to avoid these and other prevalent mistakes when implementing new initiatives should look to these five steps:

1. Assess the prevailing culture

Before launching any change effort, carefully assess your unit’s or com-pany’s culture. “Get outside opin-ions,” Bossidy advises. “Ask people you trust—a consultant, customer, supplier, former executive of the company—whether they think the culture can fulfill the objectives of the initiative.” External opinions are valuable because “people on the inside see the culture as they want to see it—not as it actually is.”

Also get a read on your culture from internal sources. Ask employees and managers questions such as, “What do you like about the unit (or company)? What don’t you like?” Solicit opinions about what’s causing your group’s or enterprise’s most pressing problems; for example, “Why does it take so long for us to get products to market? Why do we make so many order-entry mistakes?” Lis-ten for answers relating to your group’s flexibility and openness to

change. Do people feel encouraged to take risks and learn from their mis-takes? Are they comfortable talking about problems?

Most change initiatives fail, many of them soon after

implementation begins.

While assessing culture, resist any temptation to bury your head in the sand because you don’t want to hear uncomfortable truths. “A lot of man-agers don’t ask these questions be-cause they’re in denial,” says Bossidy. “Deep down, they feel that their cul-ture can’t be changed,” so they decide that diagnosing it is a waste of time. Based on your cultural assessment, decide whether your team is capable of embracing the initiative you’re considering.

2. Condition the culture

If you’ve decided that the current culture is a poor match for the effort at hand, you must condition the culture. “Make the business case for change—in compelling terms,” Bossidy says. “Then start with some-thing simple, to build confidence and demonstrate that people can work effectively together.”

Building momentum through smaller changes is particularly po-tent. “Succeeding on a small initia-tive, no matter how simple, provides a foundation for the next,” Bossidy says. It shows people that they can rise to the challenge and enables you to begin more complex changes later. (See “The Critical Importance of Short-Term Wins” in the March 2005

Update.

) This phenomenon works on every

level within an organization. For example, while serving as CEO of

Debriefing Larry Bossidy

Former Chairman and CEO, Honeywell International

What Gets Things Done


14


April 2005

AlliedSignal, Bossidy conditioned the culture for the company’s eventual adoption of Six Sigma by introducing an increasingly challenging series of starter initiatives first. These included “TQL,” or “total quality leadership,” which encouraged people to work as teams, gain experience with problem-solving tools, and analyze work prob-lems in a classroom setting.

3. Commit time and energy

Some initiatives, once implemented, reach a plateau. As the novelty wears off, people’s energy and enthusiasm wane. To combat this tendency, the best change leaders stay involved throughout implementation of the entire initiative. “Kickoff speeches and delegation are not enough,” con-tends Bossidy. “Leading an initiative requires intense focus, hard work, tremendous time, and endless physi-cal and emotional energy.”

A change leader needs to con-stantly breathe new life into the ini-tiative. For example, after Bossidy helped Six Sigma take root at Allied-Signal, he ensured that new genera-tions of

black belts

(individuals who can explain Six Sigma philosophies and principles) were trained.

He also recommends celebrating achievement of key implementation milestones. “Have an end-of-the-year or end-of-the-quarter party, where

THE PERILS OF POORLY MANAGED INITIATIVES

A badly led change initiative can wreak havoc on a unit or entire company.It can breed cynicism and damage a manager’s credibility, making intro-duction of the next change far more difficult. As Bossidy claims in

Con-fronting Reality

, “There are no free throws with initiatives: if one isimportant enough to launch, it cannot be allowed to fail. Failure costs timeand money.”

Now, consider the outcome of a well-led initiative. A successful changeeffort shows people how to “unite in action,” Bossidy points out. It alsohelps people face down fear of failure, giving them the confidence neededto tackle bigger challenges. And “it gives you a picture of how people re-spond to the demands of change in a defined context”—thus providing asort of working model of your group’s or company’s functioning.

you recognize and reward people’s contributions to carrying out the initiative.” Constantly remind people of your appreciation, and show them the quantifiable benefits of the changes they’ve made so far.

If you’re entering a situation where your predecessor had begun a major initiative, evaluate its merit. “If it’s good,” Bossidy says, “keep sponsoring it. But put your own stamp on it. Look for new angles to introduce—anything to keep the effort fresh in people’s minds.”

4. Construct an able implementation team

Assembling the right team to carry out an initiative is the most difficult yet most important imperative for change leaders, Bossidy maintains. As he notes in

Confronting Reality,

“Naturally, you want people who are enthusiastic about leading initia-tives, but you also need to make sure they’re functionally suited to the job and motivated to make things hap-pen.” If, for instance, you’re introduc-ing a new customer relationship management system to your group, ensure that the people who will be carrying out the initiative have a strong customer orientation—as well as a comfort level with and knowl-edge of the technology.

And if your implementation team

needs the participation of a few individ-uals from other departments, be pre-pared for resistance from their leaders—many of whom don’t want to lose their best people to an “outside” project.

“Appeal to these leaders’ camara-derie, commitment to teamwork, and pride in the company,” says Bossidy. “Let them know you’re depending on them. Reassure them that they won’t be losing a talented employee forever. And help them find ways to reassign responsibilities. Whatever you do, don’t let pushback from these folks stall the initiative.”

5. Call on your courage

Initiatives require people to think and act in new ways. They can re-quire a leader to change some indi-viduals’ or units’ responsibilities or remove them entirely from the team or company. Such changes in struc-ture will create “real or perceived winners and losers,” Bossidy writes in

Confronting Reality.

To ensure the initiative stays on track, deal directly with any “aggrieved constituencies and [make] sure that good people aren’t discouraged or driven out when their part of the business is cut down,” he says.

Your challenge here is to remain “both inspiring and unrelenting.” Let people know that there will be consequences for not supporting the initiative. Your message? “We’ve thought about the pros and cons, and concluded that this is something we must do…If people aren’t onboard with us, there will have to be changes made.” Changes in rewards can also “add muscle to the message,” Bossidy explains. At AlliedSignal, for in-stance, “30% of a business-unit leader’s bonus was tied to progress on Six Sigma.”

Leading initiatives will never be easy. But by applying a few potent principles, you can sweeten the odds that your initiative will survive the most common hazards.

◆

15

What Gets Things Done (continued)


Tactics

Turning Great Strategy into Great Performance


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Most companies’ strategies deliver only 63% of their promised financial value. Why? Leaders press for better execution when they really need a sounder strategy. Or they craft a new strategy when execution is the true weak spot.

How to avoid these errors? View strategic planning and execution as inextricably linked—then raise the bar for both simulta-neously. Start by applying seven decep-tively straightforward rules, including: keep-ing your strategy simple and concrete, making resource-allocation decisions early in the planning process, and continuously monitoring performance as you roll out your strategic plan.

By following these rules, you reduce the likelihood of performance shortfalls. And even if your strategy still stumbles, you quickly determine whether the fault lies with the strategy itself, your plan for pursu-ing it, or the execution process. The payoff? You make the

right

midcourse correc-tions—promptly. And as high-performing companies like Cisco Systems, Dow Chemi-cal, and 3M have discovered, you boost your company’s financial performance 60% to 100%.

Seven rules for successful strategy execution:

1. Keep it simple.

Avoid drawn-out descrip-tions of lofty goals. Instead, clearly describe what your company will and won’t do.

Example:

Executives at European investment-bank-ing giant Barclays Capital stated they wouldn’t compete with large U.S. invest-ment banks or in unprofitable equity-market segments. Instead, they’d position Barclays for investors’ burgeoning need for fixed income.

2. Challenge assumptions.

Ensure that the assumptions underlying your long-term strategic plans reflect real market econom-ics and your organization’s actual perfor-mance relative to rivals’.

Example:

Struggling conglomerate Tyco commis-sioned cross-functional teams in each busi-ness unit to continuously analyze their mar-kets’ profitability and their offerings, costs, and price positioning relative to competi-tors’. Teams met with corporate executives biweekly to discuss their findings. The re-vamped process generated more realistic plans and contributed to Tyco’s dramatic turnaround.

3. Speak the same language.

Unit leaders and corporate strategy, marketing, and fi-nance teams must agree on a common framework for assessing performance. For example, some high-performing compa-nies use benchmarking to estimate the size of the profit pool available in each market their company serves, the pool’s potential growth, and the company’s likely portion of that pool, given its market share and profit-ability. By using the shared approach, exec-utives easily agree on financial projections.

4. Discuss resource deployments early.

Chal-lenge business units about when they’ll need new resources to execute their strat-egy. By asking questions such as, “How fast can you deploy the new sales force?” and “How quickly will competitors respond?” you create more feasible forecasts and plans.

5. Identify priorities.

Delivering planned per-formance requires a few key actions taken at the right time, in the right way. Make strategic priorities explicit, so everyone knows what to focus on.

6. Continuously monitor performance.

Track real-time results against your plan, resetting planning assumptions and reallocating re-sources as needed. You’ll remedy flaws in your plan

and

its execution—and avoid confusing the two.

7. Develop execution ability.

No strategy can be better than the people who must imple-ment it. Make selection and development of managers a priority.

Example:

Barclays’ top executive team takes responsi-bility for all hiring. Members vet each oth-ers’ potential hires and reward talented newcomers for superior execution. And stars aren’t penalized if their business enters new markets with lower initial returns.

by Michael C. Mankins and Richard Steele

18


shift in corporate strategy should affect everyone in the company in some form. Near

the top of the organizational chart, the impact often is dramatic. But as you go deeper into the organization, just how the new strategy should manifest itself can become unclear.

The responsibility for creating clarity around what the strategy means at the unit, team, and individ-ual levels—and for seeing that the strategy is carried out—is shared by managers throughout the ranks.

To aid in this effort, we surveyed the experts to compile this three-point plan for converting corporate strategy into an actionable agenda:

1. Communicate the strategy to teams and individuals using relevant context and language.

2. Involve teams in defining how the strategy relates to the unit and what alignment will require.

3. Ensure each direct report is on board and on track.

“The biggest obstacle to alignment is lack of understanding,” says Mitch-ell Goozé, a consultant with Cus-tomer Manufacturing Group (Santa Clara, Calif.) and former president of Teledyne Components, a division of Teledyne. Why is this? Well, simply repeating the corporate strategy is

A

easy enough, but you must bring the strategy to life for your team—and many executives neglect to do this.

“A manager’s job should be to take the corporate goals and strategies and redefine them in a way that makes them real for the people in their de-partment,” says Kaye Lauritsen, a managing director and strategic planning consultant with RSM McGladrey (Bloomington, Minn.). “The simpler and more straightfor-ward, the better.” For example, if a key part of the strategy is improving the success rate of new products, communicate how that relates to the customer-service unit you run.

Ultimately, it may be more effec-tive at first to speculate on the strat-egy’s effect on your team— rather than dictate it—because you’ll want to make sure the team feels like it is shaping its own plan. Directly involv-ing subordinates in discussions on how to execute strategy can greatly improve employees’ commitment to the strategy and to their individual roles in carrying it out.

Of course, managers must facili-tate and direct this process, guiding employees to answer these questions:

•

How should the strategy affect our unit?

•

What must we thus accomplish?

•

How will we accomplish it?

With answers in hand, teams can then develop a shared language and framework for how to think and talk

about alignment, which will, notes a report from Capitola, Calif.–based Catalyst Consulting Team, enable people to match “their behavior to a set of commonly understood goals and actions.” To reinforce this, Lauritsen suggests using charts and other aids to measure progress to-ward new objectives.

With team guidelines set, manag-ers should turn their attention to working with direct reports. “Man-agement must ensure that every em-ployee understands how he or she brings value to the company,” says Steve Waterhouse, author of

The Team Selling Solution

(McGraw-Hill Trade, 2003), and “how their actions will move the company forward.” Specifically, managers must ensure that they and their direct reports agree on how the new strategy will af-fect how each employee sets priorities and manages his time.

Adds Lauritsen, “With a little thought and imagination, each job function can be related” to strategy. Be careful not to overload people with too many directives, she warns. “Determine which ones need to take priority and are most closely aligned to the strategy.”

One cautionary note: not all man-agers will find the road to alignment quite this direct. Most notably, changes in strategy can leave manag-ers with the wrong mix of talent. In such cases, managers must quickly move forward to acquire the people they need and then turn their atten-tion to implementation.

◆

Decisions

by Paul Michelman

How Will You Turn Top-Level Strategy into Unit-Level Action?

19


ining up a complex and, at best, vaguely hierarchical glo-bal corporation behind

a strategy that is driven by ever-shift-ing market conditions is challenging. It not only requires a clear vision sup-ported by lucid top-down communi-cation but also the focused participation of people at every level of the firm, especially unit heads. In their hands rests the daunting re-sponsibility of making corporate strategy meaningful and actionable for their teams.

As Bob Moffat, senior vice presi-dent of IBM’s Integrated Supply Chain division, noted recently, “I think about strategy every minute of the day—making sure I understand our business strategy and how I can enable that strategy.” Moffat is refer-ring here to something that goes deeper than just ensuring that his

KEY QUESTIONS IN THE STRATEGIC-ALIGNMENT PROCESS

In their work on strategy maps, Balanced Scorecard pioneers RobertKaplan and David Norton identify the following core strategy questions.Do you have a clear sense of the answers for both your company and yourunit?

•

How will we succeed financially?

•

What must we provide to our customers to achieve our financial vision?

•

Which processes must we excel at to satisfy our customers and share-holders?

•

What must our organization learn and how must it improve to achieve our goals?

L

unit is contributing to corporate goals. They’re simply the endpoint; the strategy is the course that senior management has set to get there. To be truly aligned, you must use the corporate strategy to determine

how

—through which resources and processes—you can most effectively help the organization reach its goals.

Accomplishing this requires three basic—though not simple—steps:

1. Making sure you have a clear understanding of the strategy.

2. Turning that strategy into something actionable for your staff.

3. Implementing procedures that will keep your unit aligned with the strategy.

In this installment, we discuss Step 1: making sure that you have a

clear understanding of the strategy.There’s no doubt that the respon-

sibility for articulating strategy should rest at the top. But flatter or-ganizations and occasionally imper-fect corporate communications systems can often stand in the way of the kind of crystal-clear direction re-quired to steer an aligned organiza-tion. Thus the wise executive will take the strategy bull by the horns and seek to enhance her knowledge of the corporate mandate.

Begin by asking up. Seek your boss’s interpretation and, where ap-propriate, reach even higher. Look not only for face-to-face input; speeches by the CEO, reports to shareholders, and other documents can reveal valuable insights. In some companies, notes Babson College management professor Allan Cohen, strategy is explicit, “but in others, it has to be inferred from top manage-ment.” What is on their minds? Are they talking about getting costs in line? Are they discussing top-line growth, building market share, or ex-panding product lines?

Next, compare what you hear and read about strategic priorities with where the company’s resources are actually going. There may be a lot of talk about innovation, but if the big-gest portions of the expenditure pie are earmarked for marketing the ex-isting product line, that says some-thing quite different.

It’s the executive’s task to take all the information at hand—overt and subtle, spoken and observed—and integrate it. Given the multiple infor-mation sources that you’re relying on, it’s rarely a bad idea to vet your understanding of the strategy with those around you.

◆

Decisions

by Paul Michelman

How Will You Better Align with Strategy?

20


t’s one thing to get your team focused on recasting its efforts at the outset of major change in

corporate strategy; it is quite another to keep everyone’s eyes on the strate-gic prize over time. Coming to your aid, we canvassed the experts to offer these best practices in maintaining long-term alignment with strategy.

1. Connect each project to strategy

At hpshopping.com, a unit of Hewlett-Packard, two project man-agers—one each from business and technology—work on every new ini-tiative. “We hold them equally re-sponsible for making the project a success,” says Nikhil Behl, vice presi-dent of strategy and development. To be successful, a project must not only be completed on time and on budget, but it must also advance the company as far as possible toward its goals.

Throughout the planning and im-plementation process, the project managers present weekly updates. If at any point Behl feels the team’s ob-jectives are not in harmony with the firm’s, the project is put on hold and its strategy is fine-tuned.

During the recent implementation of a business analytics system for the IT group, Behl abruptly stopped the deployment when he realized that, if integrated differently, the system could benefit all business units, not

I

just the IT group. Although the delay was inconvenient, the result is an en-terprise business intelligence system that has enabled hpshopping.com to run more efficiently, he says. More than 70% of hpshopping.com’s staff use the tool daily.

2. Measure and reward

At the core of well-aligned firms are metric and reward systems custom-built to support the strategy.

“As strategic initiatives are funded, metrics should be defined and then tracked at all relevant levels of the or-ganization,” says John Dinning, vice president of strategy and planning for Teradata, a division of Dayton, Ohio–based NCR. “This enables companies to measure successes against their goals and to drill down into the details of the business where action is required.”

The key here is to facilitate strat-egy-driven decision making, the linchpin to alignment. “Effective de-cisions should be fact-based, and re-quire broad access to accurate and comprehensive data,” Dinning says.

The right reward systems are es-sential. Marc Lewis, president, North America, of global executive search consultants Morgan Howard World-wide (Stamford, Conn.), advises tying a portion of a team’s total compensation to that team’s specific results as they relate to top-line strat-egy. Doing so rewards the team’s suc-cess in interpreting changes in corporate strategy, its ability to plan

around those changes, and how well the plans were carried out.

3. Wage war on short-term thinking

Few things frustrate managers more than seeing their best-laid strategic plans derailed by the drive for imme-diate gains. The pursuit of short-term gains is the common cold of strategic alignment efforts; no per-manent cure exists, so it keeps creep-ing back in.

People naturally try to produce tangible results. Many employees assume that pleasing the boss with this month’s numbers, or finding a solution to some seemingly pressing concern, is better than working on a task whose benefits won’t be realized until later in the year, says Adrian W. Savage, author of

A Spark from Heaven? The Place of Potential in Organizational and Individual Devel-opment

(PNA Publishing, 2002).To give strategic pursuits more

day-to-day urgency, Arlington, Tex.–based Blanchard Schaefer Advertis-ing & Public Relations ties individual goals to strategic objectives. Annu-ally, each employee is given a docu-ment with the corporate objectives listed on the top; employees must write down five to six initiatives they feel they need to accomplish during the year to help the company meet its goals. In consultation with managers, each initiative is broken down into 90-day objectives, which are further subdivided into action items.

Managers meet with subordi-nates weekly to “coach them on their progress,” says principal Ken Schaefer. “These are progress checks where we can openly discuss the successes and challenges team members are having in achieving their objectives.”

◆

Decisions

by Paul Michelman

How Will You Maintain Alignment?

21


he chain of events that leads to strong and sustained business results starts with great man-

agers who defy common manage-ment practice at virtually every turn, says Curt Coffman, global practice leader for employee and customer engagement consulting at The Gallup Organization.

What is the defining contribution of great managers? They boost the engagement levels of the people who work for them. According to Gallup research, only 28% of U.S. employees are engaged, or are actively pursuing top performance on behalf of their organizations, and Gallup studies show that this has a direct impact on the bottom line. Engaged employees lead to engaged customers, who in turn drive a company’s growth, long-term profitability, and stock price.

So what distinguishes managers who not only retain valuable employ-ees but, by boosting engagement, also extract their full value? According to Coffman, coauthor with Marcus Buckingham of

First, Break All the Rules: What the World’s Greatest Managers Do Differently

(Simon & Schuster, 1999), the answer lies in re-jecting conventional wisdom in four core areas of managing people: selec-tion, expectation setting, motivation, and development.

Selection

Most managers select employees ac-cording to the skills needed for the role, but great managers select people for their talent. Coffman defines tal-ent as a recurrent pattern of thought, feeling, or behavior and accounts for

T

the different results produced by those with the same skills and train-ing. Talent is abundant, Coffman observes, yet people whose natural talents fit their role are a rare and valuable commodity.

Consider what differentiates top-performing customer service repre-sentatives, Coffman notes. All reps in a firm get the same training, but the best take one-third fewer calls than the average to resolve the same com-plaint. Why? Because they use the phone as a tool of intimacy—they can envision what the customer looks like, what room he is in; they smile and nod even though the customer cannot see what they are doing. In-stinctively, their talent leads them to manage each customer relationship in the most effective manner.

Great managers resist the tempta-tion to hire people whose skills are a good match for how a job is already configured; instead, they seek those whose talent will redefine how the job is done.

Expectation setting

Conventional wisdom says managers should specify the steps that employ-ees need to take to accomplish a spe-cific task. But great managers define the outcomes they seek and let each person use her individual talent to achieve them. For example, while great managers do not usually man-date steps to be taken, they do pro-vide specific direction when accuracy or safety is involved, or when a com-pany or industry standard is at stake. But even then they don’t let the steps obscure the focus on the outcome.

Motivation

Conventional wisdom says that “any-body can be anything they want to be,” and thus managers tend to focus on finding and fixing a person’s weaknesses. This leads to reviews and development plans that focus on neg-atives—where the emphasis is on “improving” a person into someone he is not.

In contrast, great managers em-phasize the development of their sub-ordinates’ unique strengths so as to help further their talent, while find-ing strategies to support their weak-nesses. The key here is determining how to take greater advantage of what people already do well.

Development

Conventional managers rate the per-son and develop the performance; great managers rate the performance and develop the person—they realize that every person is different and should be treated as such.

Most companies view promotion as the natural path of progression. But is that always the right course? No, says Coffman, because success in one role is not necessarily an indica-tion of success in another.

Consider how many outstanding account representatives fail miserably when they are promoted to sales managers. The ability to sell is en-tirely distinct from the ability to manage. What’s more, promotion re-moves the high-performing salesper-son from the position in which she has been producing substantial value for the company.

Great managers seek the right fit for a person’s talent, they work to see that he is rewarded for his perfor-mance, and they endeavor to ensure that his talent is developed through progressively more challenging and meaningful assignments.

◆

Methodology

by Paul Michelman

How Great Managers Manage People

22


In this economic climate, it ismore critical than ever to makeyour staff feel recognized for

their contributions. Update soughtthe advice of best-selling author andemployee motivation expert BobNelson, who has worked with suchcompanies as FedEx, Time Warner,and IBM, on how to best handle this.

1.What’s so important about infor-

mal, manager-initiated recognition?

It’s important because recognition is

about feeling special, and more times

than not, it is hard to feel special from

a corporate program where everyone

gets the same thing, like a five-year pin.

To be effective, recognition needs to

come from those we hold in high

esteem, such as one’s manager.

2.What is necessary for delivering

effective informal recognition?

Timing is important. The sooner you

acknowledge employees’performance,

the clearer they get the message, the

more likely they are to repeat the

desired performance.

Recognition is most powerful when

it’s contingent. Companies will bring in

doughnuts on Friday and give people

cards on their birthday, and all of a sud-

den you’ve got an entitlement culture.

If you do stuff just to be nice, people end

up expecting more. So make recogni-

tion contingent upon desired behavior

and performance; they’ll value the

recogntion more and you’ll get better

results.

Five Questions About . . .Employee Recognition and Reward

with Bob NelsonCoauthor of 1001 Ways to Reward Employees and president of San Diego–based Nelson Motivation

a written or electronic note versus

public recognition.

• Manager comfort zone:What forms

of praise are you comfortable giv-

ing? If you feel awkward giving face-

to-face praise, for example, you

probably won’t do it even if you feel

you should. If you are uncomfortable

speaking publicly, it might be better

to skip public praise for something

that is more personal and sincere.

5.Are there special considerations

to delivering recognition in tough

economic conditions?

Yes. The times when we need to do it

the most, we tend to do it least. Say

you give a team award that used to

come with $250 but because you can’t

afford the $250, you stop giving the

team award anymore. I say still give the

team award. Say something like,

“We’ve had to drop the financial aspect

to hunker down, but it doesn’t dimin-

ish the value of the job that this team

did, especially at this time.” When we

are up against it, just a word of sup-

port, a team lunch, a “hang in there,”

can go a very long way. �

And you have got to keep it fresh, rel-

evant, and sincere. Any incentive has

less punch with repeated use.

3.What kinds of recognition and

rewards do employees want most?

I conducted an Internet survey that

gave people choices of 52 items. The

No. 1 factor they valued was “manage-

rial support and involvement”—asking

employees their opinions, involving

them in decisions, giving them author-

ity to do their jobs, supporting them

when they make a mistake, and so

forth. Also important were flexible

working hours, learning and develop-

ment opportunities, manager avail-

ability, and time.

Employees also want basic praise.

In the top 10 factors, there were four

types of praise: personal praise, written

praise, public praise, and electronic

praise. Those are the hottest ones for

people, and none of them costs a dime!

4.How do you choose what type of

praise to use in a given situation?

Weigh these factors:

• Availability of the medium: How

often do you actually see the individ-

ual—do you manage him from a dis-

tance or does he telecommute? Do

you have occasion for public praise

such as periodic staff meetings?

• Employee preference: Do you know

how the employee prefers to be

praised—have you ever discussed it

with her? For example, an intro-

verted employee would likely prefer

NELSON’S MUST-READS

Make Their Day! Employee Recog-nition That Works, by Cindy Ven-trice (Berrett-Koehler, 2003).“Shegot to some of the core issues.”

The Magic of Employee Recogni-tion: 10 Proven Tactics fromCalPERS and Disney, by DeeHansford (WorldatWork, 2003).“She gives you a little bit moredepth.”

Other People’s Habits: How to UsePositive Reinforcement to BringOut the Best in People Around You,by Aubrey C. Daniels (McGraw-Hill, 2000). “Practical, but firmlybased in theory.”

23

Decisions

by Paul Michelman

How Will You Make Your Team a

Team?

24

hat do you do when the whole of the team you’re leading appears to be less

than the sum of its parts? Everything seems to be in place: solid people, a demanding but ultimately reasonable plan, sufficient resources. Yet there’s still something missing from the ef-fort, and finding a solution to this problem falls squarely on your shoulders. No, leaders can’t single-handedly boost performance, but they can guide the tone, the tempo, and the mechanisms that create the opportunity for better things.

Begin by considering this seem-ingly simple question: Does the group you have assembled view itself as a team? Often, executives “have re-cruited and promoted a number of executives, all with specific goals and objectives,” says Rodger Stotz, vice president of Maritz, a St. Louis–based performance improvement com-pany. “Whether these individuals see themselves as a team is another thing.” Perhaps they have “noncom-plementary goals and are encouraged to compete with each other for re-sources and recognition.”

So a leader’s first step is often to declare that a team exists and to sup-port that assertion with “clarity as to how the participants are to interact and support each other,” says Stotz. While leaders must encourage trust and support, they should also pro-vide an environment that promotes disagreement, says Patrick Lencioni of the San Francisco–based manage-ment consulting firm The Table

W

Copyright © 2004 by Harvard Business School Pu

Group. “Healthy conflict enables teams to bring all team knowledge and opinions to the surface, which leads to better decisions.”

Performance expectations—and the accountability measures that should ride shotgun with them—must be as clear as those governing behavior. This applies both to the team as a whole and to the individu-als who make it up, says Hellen Davis, CEO of the Philadelphia-based con-sultancy Indaba Training Specialists. “Each person should know the stakes and clearly grasp how others will de-termine whether they meet expecta-tions, fail to deliver, or exceed expectations.” Says Lencioni, “Teams that cannot hold one another ac-countable are susceptible to allowing individual and department priorities to supersede the goals of the team.”

The expectations you set as a leader become building blocks for the shared vision held by the most effec-tive teams. “Most people have an idea of what they are trying to achieve,” says Marcia Reynolds, author of How to Outsmart Your Brain (Covisioning, 2001), “but their picture of what this destination looks like varies, causing differing goals, priorities, and needs. Visions need to be visual and specific, then negotiated so everyone is fo-cused on the same path.” The devel-opment of a shared vision might begin with a discussion of how the team builds value.

A compelling vision, based on clear goals and expectations, is only as effective as the communications

blishing Corporation. All rights reserved.

strategy put in place to support it. Again, it’s up to you to set the pace. Steve Farber, author of The Radical Leap: A Personal Lesson in Extreme Leadership (Dearborn Financial Publishing, 2004), suggests seeking “extreme feedback on your own per-formance. Put your own ego directly at risk and ask, How am I doing?” A leader’s willingness to hear criticism establishes the model for others in the group to follow, while creating “a strong human connection that en-genders commitment and loyalty,” he notes.

Effective communication is more than simply the currency of interper-sonal commitment. Managers in IBM’s Engineering and Technology Services group who were surveyed for this column say it is the core of a team’s operational effectiveness. To exploit opportunities that arise, team members must “communicate con-stantly—so they understand direc-tion changes, updates, and key issues” as they evolve, says IBM’s Cary Ziter. This is essential to the process of building value. As an ex-ample, he notes, “if the Research Group [at IBM] has just earned a patent on an important technical in-novation, can the design engineers leverage that intellectual property in a current or near-term client engage-ment?” This is possible only if project managers continually convey their knowledge of what’s going on to other parts of the company.

To support this kind of behavior, Bill Treasurer, author of Right Risk: 10 Powerful Principles for Taking Leaps with Your Life (Berrett-Koehler, 2003), suggests that leaders establish systems that “reward team members who give others the heads-up on changing circumstances, updated in-formation, or potential risks.

“The best team members,” he con-tinues, “anticipate the needs of one another.” ◆


etting others involved in the work you’re responsible for is the essence of management.

But what distinguishes the best lead-ers is

how

they attain that involve-ment. Requiring participation is easy enough. But compliance does not equal engagement.

Employees genuinely support only those things they have a hand in cre-ating, says change consultant Richard H. Axelrod, coauthor of

You Don’t Have to Do It Alone: How to Involve Others to Get Things Done.

That real-ization fundamentally changes the way you manage.

1.

Where do managers go wrong

when thinking about involvement?

Most tend to answer the question

“What kind of involvement do I need?”

either from the perspective of a realist

or from that of a humanist. Realists

focus on the aspects that have to do

with getting things done: developing a

plan and a budget for the work, ensur-

ing that the deadlines will be hit. Hu-

manists are primarily concerned about

the people aspects—for example, mak-

ing sure everybody understands and is

committed to the plan, and figuring

out how to handle any resistance to the

plan. To get things done in an organiza-

tion, you need to bring both perspec-

tives to bear on your thinking.

2.

What’s so distinctive about that?

Approaching a project from both per-

spectives helps you appreciate more

fully the different types of involvement

that are often required.

G

For example, some humanist man-

agers think just in terms of getting buy-

in. We call this

care-and-commitment

involvement.

It’s essential for work that

calls for change or requires people to

stay involved for an extended period.

But it’s not the only type. There’s also

teaching-and-learning involvement,

which builds others’ skills so they can

be more productive and take on new re-

sponsibilities. And then there are more

“realist” types of involvement:

know-

how involvement

, which supplies the

skills, experience, and knowledge you

lack, and

arms-and-legs involvement

,

which is needed when the scope of the

work exceeds your time and energy.

Our approach helps you think not

only about the types but also the levels

of involvement you need. Involvement

is not an all-or-nothing proposition:

you may need someone for her exper-

tise and nothing else.

3.

What are some creative ideas

about whom to involve?

Move beyond what we call “the usual

suspects”: people who care about or

stand to be affected by the initiative,

people with relevant knowledge and

expertise, and people whose authority

is touched by the work.

It’s also important to expressly in-

clude people with diverse points of

view—this usually results in more in-

novative solutions. And as strange as it

may sound, there are good reasons for

bringing resisters, detractors, and

other troublemakers onboard. It’s bet-

ter to have a troublemaker using his

energy inside the initiative instead of

stirring up trouble and distrust from

the outside. Besides, seeing that his

concerns will be taken seriously may

turn him into an instrumental team

member.

4.

What

keeps

people involved?

When people are so mired in the details

of a marathon project that they can’t

remember why they signed up for it,

they need to know that their contribu-

tions count.

There are several things you can

do in this regard. Keep the vision for

the project front and center: remind

people what’s going to be different as a

result of your collective efforts. Give

them regular progress reports about

what’s been achieved so far. And make

sure they know that their input is val-

ued. That’s what keeps their heads in

the game.

5.

Why is closure so important?

It’s at the completion of a project that

you build a foundation for the future.

Celebrating what’s been accomplished

makes people more willing to partici-

pate in other initiatives. But there’s a

knowledge transfer component, too.

At the gathering to celebrate the

end of the first stage of a project that

will take place in different parts of an

organization I’m consulting to, we also

invite the people who’ll be involved in

stage two. For them, it will be invalu-

able to hear people involved in the

first stage talk about what worked and

what didn’t.

◆

Five Questions About…How to Get People Involved

with Richard H. Axelrod

Coauthor,

You Don’t Have to Do It Alone

(Berrett-Koehler, 2004)

25


hat are the hallmarks of effective senior-team leaders? Not only do they

accept that tension and competition are unavoidable, they embrace it, even encourage it. Even more impor-tant, they are able to channel this conflict toward a common good.

THE TEAM LEADER’S CHECKLIST

Do you manage the team’s context?

•

Do you ensure that information flows in both directions between the team and its constituencies?

•

Do you fight for the resources needed by the team, remove barriers, and promote its interests with key stakehold-ers?

Have you put conditions in place for team effectiveness?

•

Does the team have a clear mandate?

•

It is composed of the right people and structured so that work can be done efficiently?

Has your team agreed upon a meaningful performance goal?

•

Have you clarified deliverables that are linked to the agenda?

•

Do you revisit the goal frequently to ensure it remains meaningful?

Does the team have a rigorous decision-making process?

•

Does it spend sufficient time identifying and framing problems?

•

Has it developed a decision-rights framework?

•

Are data and alternatives identified and examined thoroughly?

Have you facilitated the development of appropriate norms?

•

Do you encourage and support task conflict?

•

Do you encourage collaboration and treat mistakes as sources of learning?

•

Do you think about and describe your role in team terms?

Do you facilitate communication within the team?

•

Do you make space for different conversations and participatory styles?

•

Do you encourage active listening?

•

Is influence based on task-relevant knowledge rather than on status or personal dominance?

Are you sensitive to team diversity?

•

Do team members make an effort to understand and adapt to one another’s working styles?

•

Do team members understand how diversity might affect members’ participation and influence?

•

Has the team developed a strategy for fully utilizing and embracing diversity?

W

This is no easy task, of course. In the upper reaches of large organi-zations, teams include executives with billion-dollar responsibilities. These executives have their own strategic priorities, are competing for sometimes scarce resources, and may well be jockeying for posi-

tion in the succession queue.To help senior-team leaders

manage the tensions and extract top performance, Harvard Business School professor Linda A. Hill, in her teaching note “A Note on Building and Leading Your Senior Team,” has developed for senior- team leaders a checklist of the key levers to pull. It will not only aid leaders of senior teams but also team leaders at all levels of the organization.

◆

Methodology

by Paul Michelman

Building and Leading Your Team

26


here are a variety of reasons why groups and organizations become stuck, say Keith

Yamashita, cofounder of the San Francisco consulting firm Stone Yamashita Partners, and Sandra Spataro, professor of organizational behavior at the Yale School of Man-agement. In

Unstuck: A Tool for Your-self, Your Team, and Your World,

they argue that making the right diagnosis requires viewing a group’s purpose, strategy, people, processes, metrics, and culture as an interconnected whole.

Here, Yamashita discusses the most prevalent causes of stuck teams today.

1.

What characterizes leaders who

are adept at getting teams unstuck?

All great companies, all great teams,

get stuck at some point. The most

skilled leaders don’t see

stuck

as a pejo-

rative term; to them, it’s simply a de-

scriptive term, a diagnosis pointing the

way to future success.

They also don’t underestimate the

amount of control they have. They don’t

look to senior management to fix their

unit’s problem, nor do they blame their

team members.

2.

What’s the remedy for all the

exhausted companies out there now?

A company or team becomes ex-

hausted when every element of its sys-

tem is out of sync with the way the real

T

world works. The conditions in which

you compete have completely changed,

and the amount of energy required to

bring new ideas to market is incredibly

draining.

I’ve talked to people in the technol-

ogy, financial services, and media sec-

tors, as well as to dot-com survivors—

they’re all exhausted. The pace of

change just hasn’t slowed down, even

during the downturn of the past sev-

eral years, and I don’t see it slackening

off any time soon.

The notion of purpose plays a very

important role in reinvigorating an ex-

hausted team. You need to start with is-

sues of the heart: help the team

reaffirm or update what its guiding

purpose is. If you don’t get people’s

hearts into it, there’s no way you’re

going to find the energy to fundamen-

tally transform their systems. What we

call a “moon shot” provides one way of

doing this. Ask your unit questions like:

What is the ambitious reason that our

group exists? What is currently out of

our reach, in terms of our ambitions,

but absolutely worth trying to achieve?

3.

How do the exhausted and the

overwhelmed diagnoses differ?

When your unit is overwhelmed, that’s

often a sign that it’s on the road to ex-

haustion. A group becomes over-

whelmed when its structure and

processes don’t match the reality.

One example is when your company

has created unnecessary bureaucracy

and an inordinate amount of protocols.

This was the situation that confronted

Lou Gerstner when he became head of

IBM in 1993. He worked very hard to get

IBM to where it could compete, stream-

lining how strategic planning got done,

pushing decision making down to the

lowest level possible so that products

got to market faster. Another example

is when you don’t have sufficient struc-

ture and processes. Here, it feels like in-

formation about your organization and

the outside world is coming in too fast

for you to process.

4.

What’s the remedy for a direc-

tionless team?

A directionless team confuses practice

with strategy. It’s all thrust and no vec-

tor. “If we follow this procedure,” it tells

itself, “we’ll be successful.” Well, not

necessarily—not if the team has forgot-

ten why it’s doing what it’s doing.

Execution-obsessed cultures tend to

focus on only those things that they can

measure and execute in the near term.

In the retail industry, for example,

managers can get so caught up in

boosting comparable sales figures that

they lose sight of more fundamental in-

dicators such as customer loyalty and

intent to return, which are leading indi-

cators of future profitability. Instead,

they should be asking simplifying ques-

tions that help put the system back in

balance—questions such as, What are

the most important things we should

be paying attention to in order to suc-

ceed?

5.

How do you know which simplify-

ing questions to ask?

Leaders who are constantly evaluating

even the smallest interactions against

the systemic frame do far better at un-

derstanding what actions need to be

taken today and in the future. For ex-

ample, if a planning session goes awry,

ask whether your strategy and purpose

are aligned.

◆

Five Questions About… Getting Teams Unstuck

with Keith Yamashita

Coauthor of

Unstuck: A Tool for Yourself, Your Team, and Your World

(Portfolio/Penguin, 2004)

27


ower and influence in today’s companies have less to do with employees’ positions on the

organizational chart and more to do with their ability to energize oth-ers in their organizational networks, says Wayne Baker. Groundbreaking research by Baker, Rob Cross (assis-tant professor at the University of Virginia’s McIntire School of Com-merce), and Andrew Parker (then re-search associate at the IBM Institute for Knowledge-Based Management in Cambridge, Mass.) was able to measure the long-noted influence that energizing relationships have on performance.

1.

How were you able to link ener-

gizing behavior to performance?

We combined network analysis

with survey questions that asked

respondents to rate the energizing or

de-energizing effect of interacting with

each of the people in their organiza-

tion. That enabled us to create an en-

ergy map that showed where the

pockets of energy were and also where

the de-energizing interactions were in

the organization.

When we compared the maps

against the respondents’ annual per-

formance ratings, which were based on

objective measures of project out-

comes and customer feedback, we

found that the more people you ener-

gize, the higher your performance rat-

ing, and vice versa.

Someone who is energizing elevates

the performance of other people

P

around her. They feel more creative

when they’re working with her; they’re

more likely to work hard on her behalf

and to devote discretionary time to her

projects.

2.

What distinguishes energizers?

Energizers do five things very well. They

create a compelling vision by focusing

on possibilities rather than current or

past problems. They help others feel

fully engaged. And while they’re doing

that, energizers are also learning from

their colleagues. Energizers are goal-

oriented but flexible about how to get

there—they allow progress to occur in

unexpected ways. Finally, energizers

speak their mind, maintaining integ-

rity between their words and actions.

This influences others’ willingness to

believe that the goal is worthy and at-

tainable.

3.

Are energizing behavior and

high-energy behavior the same thing?

A high-energy or charismatic person

generates what psychologists call

high-

arousal emotions

in others. But energiz-

ing behavior is about letting other peo-

ple know they matter—for example,

when someone comes into your office

to speak with you, you devote your

physical presence and undivided atten-

tion to that person. Even

a shy person can be energizing in

this way.

People don’t have to initially like the

leader of a project in order to be ener-

gized. The ability to energize isn’t a

function of personality; it has to do

with the behaviors you exhibit in your

interactions with others.

4.

Couldn’t energizing behavior lead

to groupthink?

An energizer isn’t a cheerleader or a

wild-eyed optimist; he simply focuses

on the opportunities rather than the

constraints. When energizers hear a

suggestion they disagree with, instead

of dismissing it outright, they’ll search

for what’s good in that suggestion.

De-energizing people tend to be more

negative, focusing on all the reasons

why you can’t do something.

To me, de-energizing behavior is the

more likely cause of groupthink. People

who are de-energizing often possess

valuable knowledge and alternative

views of things. But because of their de-

energizing behavior, these people be-

come isolated: their expertise and

knowledge go untapped. By contrast,

energizing people are more likely to in-

crease the flow of information—includ-

ing divergent points of view—

throughout the organization.

5.

How do you turn de-energizers

into energizers?

First you need to create awareness,

then follow it up with diagnosis.

The supervisors at the petrochemical

company we studied were aghast when

they saw the network charts

diagramming their de-energizing

effect on others. That kind of data is

hard to argue with; it prodded the

supervisors to analyze their behavior

and discover that they had been

micromanaging.

When you’re analyzing your behav-

ior, look at how you use your own ex-

pertise: Do you destroy others’ energy

in your haste to find a solution or dem-

onstrate your knowledge? Do you have

a tendency to force others to come

around to your way of thinking? Also,

when disagreement arises, do you

focus on the individual rather than on

the issue at hand?

◆

Five Questions About… How to Energize Colleagues

with Wayne Baker

Professor, University of Michigan Business School

28


here are a few in every bunch: the naysayers, the predictors of disaster, the ones who dig

in their heels and fight you at every turn. What would a change initiative be without them?

No matter how well planned your efforts, you can’t avoid change resist-ers in the management ranks. They are a fact of organizational life, and you’d be wise to accept them; to plan for them; and, indeed, to love them. For they often hold a value many firms never bother to tap.

Macrostrategies do not suffice

Most change programs include top-tier strategies for overcoming em-ployee resistance by building a sense of urgency, creating feelings of inclusion and empowerment, and providing clear communica-tion. But although these are essen-tial elements, they do not necessarily address resistance among individuals or small groups—where it can be at its most nefarious. No, one cannot and should not try to win over

everyone.

Focus your efforts where they’ll have the most impact. Consider the following:

•

Where would resistance be most harmful? In what areas could it be crippling during the change process? Focus there first.

•

Where might resistance have spreading power? In every firm, there are individuals whose in-fluence extends well beyond

T

their roles. If they’re not with you, they can kill you. One proven approach: Get them in-volved in managing the initia-tive from the start.

•

Where might resistance run the deepest? Who has the most to lose? Surveys can help scout out pockets of resistance among units. Even anonymous polls gauging attitudes toward change can reveal important trends.

Once you’ve designated the areas of greatest resistance, begin an ag-gressive plan to understand it, make use of it, and overcome it.

They might have a point

One of the biggest mistakes change leaders can make is to assume that re-sistance is without merit—and in the heat of the moment, it’s awfully tempting to do so.

“It’s important to assess whether or not a resister has sound business reasons for not changing,” says strat-egy consultant Phyllis Ezop. “Resist-ers who understand the business well can shed valuable insights about how proposed changes might be modified to increase the odds for success.”

Some encourage resistance be-cause it can help point out potential objections of tough clients and wary consumers, notes Larina Kase, presi-dent of Philadelphia-based Perfor-mance and Success Coaching.

Giving resisters their day in court can do more than reveal potential

pitfalls; it can turn them into power-ful supporters, notes Ezop.

Deconstruct and rebuild

The key to turning resisters around is to deconstruct their objections and rebuild their points of view, says former New York City–based Mc-Kinsey & Company consultant Kaihan Krippendorff, author of

The Art of the Advantage: 36 Strategies to Seize the Competitive Edge

(Thomson Texere, 2003). Consider the following lessons from Krippendorff ’s own change efforts.

Core beliefs hinder change.

In-quiry into the reason why one of Krippendorff ’s managers resisted the change program revealed that he be-lieved it was running well and could improve only with added resources not associated with the change effort. This core belief made him blind to the change’s benefits.

Beliefs are artificial.

Dissecting how beliefs form reveals that (a) they rest on a shaky combination of logic and selected evidence and (b) they persist in language. Identify the logic, evidence, and language on which your target belief depends.

Beliefs can be replaced.

Once you have identified your target be-lief ’s weak point, attack it with alter-native language, logic, or evidence that focuses on positive outcomes of the change program. Recasting hur-dles as doors to bigger opportunities is a classic example.

And when all else fails, several ex-perts note, don’t be afraid to address a question often on resisters’ minds: What’s in it for me?

◆

Methodology

by Paul Michelman

Overcoming Change Resisters

29

T H E I D E A

It’s a gl orious image: all your employeesmarching off in the right direction, inspired by your vision, passion, and logic. The problemis, this leadership approach works only withalready motivated people.

What about those other, difficult folks who consume too much of your time? How do you energize them? Contrary to conventionalwisdom, you can’t—only they can.

Everyone has motivational energy. In fact, most problem employees are driven and com-mited—but only outside the office. The work-place—seemingly uncaring bosses, especially—can block that inherent motivation.

Here’s how to remove these blockages andchannel inherent motivation toward your company’s goals.

How to Motivate Your Problem People

In t rying to motivate problem employees,most managers mistakenly try to “sell” theirviewpoint to employees—or simply dismissthem as “bad characters.” These mistakes stem from common but false assumptions: that everyone else thinks like we do, that wecan change others, and that employees areproblems to be solved.

A Better WayUse these steps to unleash problem employees’internal drive—or arrive at the shared conclu-sion that it’s impossible.

1. Create a rich picture of the problememployee. Don’t simply label him difficult.Explore three factors instead:

The employee: Through informal conversa-tions, discern what drives him, what’s block-ing those drives, and what could happen ifblockages were removed.

E X A M P L E :Jerry, a new pharmaceuticals company manager,learns that Bernard—a talented but reticent andangry scientist reporting to him—was passedover for a promotion. Jerry’s insight? Bernardyearns to preserve his dignity.

Yourself: How might you be bringing out theperson’s worst? Ask him and his colleagues to describe how you come across. Somethingbasic—for instance, how you talk—may bewrong for him, though fine for others.

The situation: What may be eliciting the worstfrom both of you? For example, a tough re-structuring may increase the employee’s stressand lessen your tolerance for his behavior.

HBR OnPoint © 2002 by Harvard Business School Publishing Corporation. All rights reserved.

2. Reframe your goals. Replace predetermined“solutions”—required new behaviors with thethreat of dismissal if he doesn’t comply—witha menu of possibilities. Flexibility can yieldsurprisingly rich alternatives.

E X A M P L E :A customer-account processor’s proclivity towardgossip and office politics might be directed moreconstructively toward team building. And oppor-tunities to interact directly with customers mayprovide the interpersonal stimulus he’s craving.

3. Stage the encounter. In a face-to-face meeting, affirm the person’s value to yourcompany, describe the problem as you see it, assert things can’t continue this way, and state your desire for a mutually bene-ficial outcome.

Then test hunches about ways to co-opt the person’s passions for productive ends.Watch for unexpected areas of agreement—then tease ideas out of the person. To avoidanother “yes, boss” encounter, don’t “sell”your viewpoint.

E X A M P L E :When the scientist Bernard says,“Nobody withtechnical smarts gets respect here,” Jerry sees an opening: make Bernard an advisor and tech-nical coach for his unit—and get him credit for it. Now Bernard must propose specifically how this might work.

When you liberate people’s inherent motivation,you boost morale throughout your organizationby demonstrating that you’re willing to workthrough difficulties, not simply discard them.

T H E I D E A A T W O R K

I N B R I E F

30

by Nigel Nicholson

T H E I D E A

That darned employee! His performancekeeps deteriorating—despite your close moni-toring. What’s going on?

Brace yourself: You may be at fault, by unknow-ingly triggering the set-up-to-fail syndrome.Employees whom you (perhaps falsely) view asweak performers live down to your expecta-tions. Here’s how:

1. You start with a positive relationship.

2. Something—a missed deadline, a lost client—makes you question the employee’s perform-ance. You begin micromanaging him.

3. Suspecting your reduced confidence, theemployee starts doubting himself. He stops giving his best, responds mechanically to your controls, and avoids decisions.

4. You view his new behavior as additional proofof mediocrity—and tighten the screws further.

Why not just fire him? Because you’re likely torepeat the pattern with others. Better to reversethe dynamic instead. Unwinding the set-up-to-fail spiral actually pays big dividends: Your company gets the best from your employees—and from you.

The Set-Up-to-Fail Syndrome

HOW SET-UP-TO-FAIL STARTS

A manager categorizes employees as “in” or“out,” based on:

• early perceptions of employees’ motivation,initiative, creativity, strategic perspectives;

• previous bosses’ impressions;

• an early mishap; and

• boss-subordinate incompatibility.

The manager then notices only evidence sup-porting his categorization, while dismissing contradictory evidence. The boss also treats the groups differently:

• “In” groups get autonomy, feedback, andexpressions of confidence.

• “Out” groups get controlling, formal manage-ment emphasizing rules.

THE COSTS OF SET-UP-TO-FAIL

This syndrome hurts everyone:

• Employees stop volunteering ideas and information and asking for help, avoid con-tact with bosses, or grow defensive.

• The organization fails to get the most from employees.

• The boss loses energy to attend to other activities. His reputation suffers as otheremployees deem him unfair.

• Team spirit wilts as targeted performers are alienated and strong performers are overburdened.


HOW TO REVERSE SET-UP-TO-FAIL

If the syndrome hasn’t started, prevent it:

• Establish expectations with new employeesearly. Loosen the reins as they master their jobs.

• Regularly challenge your own assumptions. Ask:“What are the facts regarding this employee’sperformance?” “Is he really that bad?”

• Convey openness, letting employees challenge your opinions. They’ll feel comfortable discussing their performanceand relationship with you.

If the syndrome has already erupted, discussthe dynamic with the employee:

1. Choose a neutral, nonthreatening location;use affirming language (“Let’s discuss ourrelationship and roles”); and acknowledgeyour part in the tension.

2. Agree on the employee’s weaknesses andstrengths. Support assessments with facts,not feelings.

3. Unearth causes of the weaknesses. Do youdisagree on priorities? Does your employeelack specific knowledge or skills? Ask: “Howis my behavior making things worse for you?”

4. Identify ways to boost performance. Training?New experiences? Decide the quantity andtype of supervision you’ll provide. Affirm yourdesire to improve matters.

5. Agree to communicate more openly: “Nexttime I do something that communicates low expectations, can you let me know immediately?”


I N B R I E F

31

by Jean-François Manzoni and Jean-Louis Barsoux


ou simply can’t tolerate un-derperformance. Budgets are too tight, margins are too

close, and the need for growth is too overwhelming for even the largest or-ganizations to be carrying any dead weight.

For overburdened executives, often the first instinct is to drop un-derperforming managers. After all, who has the bandwidth to deal with them? “Underperformers take an in-ordinate amount of energy to man-age,” says Jim Bolton, CEO of Ridge Associates, a communications con-sulting firm. “You not only have to manage

their

performance, but, as chronic offenders, they become problems in

your

performance.”

Look before you leap

Firing and replacing key managers is an arduous and time-consuming task. Not only is the separation pro-cess fraught with pain and risk, but according to Michael Watkins, Har-vard Business School professor and author of

The First 90 Days

(Harvard Business School Press, 2003), the manager you hire may take six months or more before she produces any value.

Thus many executives don’t con-front problem behavior at all, Bolton says, “They find workarounds: they

Y

avoid the person, they’re vague in giving feedback, and they often end up with more work to do in trying to compensate for these underperform-ers. One executive I worked with re-organized his 1,000-person division so he could make an underperformer someone else’s problem,” he says. “But ultimately the choice comes down to fish or cut bait.”

In making that choice, experts say, you owe it to yourself, your organiza-tion, and to the manager in question to take at least one shot at diagnosing and addressing the underlying causes of unsatisfactory performance—especially if the employee has shown value in the past. To do so, consider this advice from the experts.

Diagnose and prescribe

Before you can solve the dilemma of an underperforming manager, you need to establish the details of the problem. Begin by carefully evaluat-ing the manager’s results. “What is the manager doing or not doing?” asks John Baldoni, the author of sev-eral books on leadership. “Is he mak-ing the numbers? If not, why not?”

Next, Baldoni says, look at 360-degree results if you have them. “What are peers, bosses, and employ-ees saying about the manager?” You should also do your own 360, asking key stakeholders and peers about the manager’s performance.

In addition, Baldoni suggests ask-ing the manager to provide his view on why his performance is subpar. “The reasons could vary from lack of

support from you (the boss); inade-quate resources in people, budget, and time”; to myriad other factors. “The manager may also be facing problems outside the office with spouse, children, or parent care.”

Then consider talent/skill fit: “Ask yourself if this manager is in the right position,” Baldoni says. “Does he have the right talent to do the job as well as the skills to perform? Talent you cannot coach; skills you can develop.”

According to Joseph Weintraub, a professor of management at Babson College, performance issues with managers most often “revolve around a common lack of understanding of expectations between managers and their bosses.” One way to diagnose this, he says, is to ask the manager to write down the “three most impor-tant things that they get paid to do. Then the manager’s boss would inde-pendently do the same exercise for the manager.”

After both have finished the exer-cise, they would compare results. “In the majority of cases, the lists look dramatically different, with a ‘hit rate’ of about one out of three expec-tations in common,” Weintraub says. “With this data, the boss and man-ager can align expectations more clearly to help the manager to focus on doing the ‘right things.’”

Give solutions reasonable time to take

Bolton cautions executives to main-tain realistic expectations for a turn-around in performance. “It takes six weeks or longer for people to change behavioral patterns,” he says. If you give a manager an appropriate amount of time and he is still not meeting the expectations you clearly laid out, Bolton says, “you’ll have to decide if their continued perfor-mance is worth the price your busi-ness pays for the status quo.”

◆

Decisions

by Paul Michelman

Will You Help or HeaveYour Underperformers?

32


t’s not easy to keep people fo-cused and productive in this un-certain economic environment.

Even at companies heading in the right direction, the slowly improving job market may prompt some em-ployees to daydream of greener pastures. What executive wouldn’t welcome some tactics to help keep everyone’s head in the game?

As many organizations can attest, building a stronger sense of account-ability both within individuals and among groups can pay dividends: doing so increases employees’ invest-ment in improving the quality of their own performance as well as that of their unit and, indeed, that of the entire organization.

For their part, managers have to be sure to align incentives and salary with performance.

Here’s a quick primer on building and rewarding accountability within your unit and organization.

At the individual level

“To make work truly motivational, individuals need to know how their efforts fit into the bigger picture,” says Deborrah Himsel, vice president of Organizational Effectiveness at Avon Products (New York City). A clear understanding of accountabili-ties is what cements this. The key for managers: if you want employees to take ownership of their work, you must be specific in your expectations and direct in how you connect each individual’s efforts to the unit’s and company’s bottom line.

I

A focus on accountability de-mands a lot of managers. You not only must give people the individual attention they need to embrace ac-countability, but you must also take action when people don’t live up to standards.

“One person not meeting expecta-tions can bring the whole team down,” says Martha Duesterhoft, owner of Human Resource Ally (Arlington, Texas). You can’t expect people to embrace their own ac-countability if you tolerate a lesser resolve in others.

At the team level

With accountability built among in-dividuals, executives should then en-courage the development of shared accountability among team mem-bers. One way to promote this, and to build a strong sense of collaboration, is to use what Morris R. Shechtman, author of

Fifth Wave Leadership

(Facts on Demand Press, 2003), calls “accountability groups.”

An accountability group is a work-ing session in which people are ex-pected to be frank and open. “Many people fear receiving or giving feed-back; they don’t want to show others a weakness or make others uncom-fortable,” Shechtman says. “Put them in the right setting, however, and they may be willing to provide others with clear and compelling feedback.”

In accountability groups, people are given license to speak and listen in a way that would be challenging in a normal work setting. And partici-

pants are expected to create action plans based on the exchange of feed-back and to hold one another ac-countable for implementing them.

“When people can come to-gether and share ideas, they get en-ergized about their work,” says Avon’s Himsel. And accountability

within

the team is the cornerstone of accountability

among

teams in the organization.

Reward

You’ve established a strong sense of accountability, and your team is off driving for results. What keeps them moving forward? While few would argue that an accountability-based work experience can be highly re-warding, employees need proof that their efforts are driving the company ahead, and they need to share in the fruits of their labors.

It is the offer of increased pay based on financial performance that keeps this engine running. Some firms (especially in the service indus-try) now tie all variable compensa-tion to firm performance, thinking that it motivates employees to believe that they can work together to make strides, even in difficult times.

Other companies balance the fi-nancial reward between employees’ desire “to be judged by what they can see,” says Himsel (which affirms their personal and team accountabilities), and how the firm performs as a whole (which affirms the need for shared accountability among groups throughout the company).

◆

Methodology

by Paul Michelman

Tap Into the Power of Accountability

33


n her book

Common Knowledge: How Companies Thrive by Shar-ing What They Know

(Harvard Business School Press, 2000), Nancy Dixon makes a compelling case for the value of idea sharing inside companies. Ford saved $34 million in just one year by transferring ideas between vehicle operations plants, she writes. Texas Instru-ments saved enough from transfer-ring ideas between wafer fabrication facilities to pay for building a new plant; Chevron reduced its costs on capital projects by more than $800 million.

But five years after Dixon spelled out the bottom-line benefits of idea sharing, companies that do it well remain the exception. Most companies still struggle, squander-ing millions as money-making and cost-saving ideas lay dormant or underused.

FOUR TENETS OF EFFECTIVE IDEA SHARING

1. Think long-term: embed idea sharing in your com-pany’s DNA.

2. Consider designating a permanent team to help champion and implement new ideas.

3. Reward early wins, and build compensation systems that foster similar successes.

4. Think anecdotal evidence over quantitative proof.

I

There are many reasons organiza-tions fail to take full advantage of their own knowledge: there are no processes to encourage sharing; people aren’t rewarded for it; and, most significantly, knowledge is power—those with the best ideas de-liver the best performance relative to their peers and thus reap the biggest rewards.

“People don’t want to share good ideas because ideas provide an inter-nal advantage,” says Steve Kerr, chief learning officer at General Electric under former CEO Jack Welch and now in a similar role at Goldman Sachs. Says executive coach Ted Sun, “The individualistic mindset to com-pete is dominating most organiza-tions. Although management might talk of teamwork and sharing, there is no one to hold people accountable.”

Thus, Kerr says, the secret to mak-ing knowledge sharing a core organi-zational competency lies in flipping the culture around so that sharing becomes central to executives’ “self-ish best interest.” The very reasons executives might now hoard an idea—to stand out, to get ahead—must become their motivation for spreading it.

Go beyond systems

At GE, Kerr and Welch didn’t find the secret to moving ideas in a set of spe-cific knowledge-sharing methodolo-gies but rather in weaving idea sharing into the very fabric of the company. At GE’s Session IIs—the annual performance updates from the top 500 GE executives—Welch would grill managers not only on

what new ideas they had developed but also on how they were working to spread them.

When a new concept would catch Welch’s fancy, Kerr says, he would re-mark: “That’s a great idea; who else is using it?” Indeed, executives were more often rewarded for moving the idea than for creating it.

GE used both positive and nega-tive reinforcement to encourage idea sharing. On the positive side, Welch and other top executives would publicly laud those who devel-oped and moved new ideas, while promotions and top assignments went to executives who proved effec-tive at sharing and/or adopting ideas from elsewhere. On the flip side, at GE “if you don’t share, you get ac-cused of hoarding, which is an integ-rity violation that could get you fired,” Kerr says.

Companies that don’t have strong traditions of idea sharing can’t expect to achieve GE’s “boundaryless” ideal overnight. But a handful of proven approaches will prove useful to any organization intent on making better use of its body of knowledge.

From rewards to routines

Effective idea sharing occurs on three planes, according to Kerr:

1. Up and down the organiza-tional chart

2. Across departments and silos

3. In and out of the firm (to and from customers, partners, regu-lators, suppliers, and so on)

Whatever plane ideas are moved on, there must be this consistency: when you share or bring in a new idea, you benefit.

While Kerr believes that for idea sharing to be truly effective, it must become part of the organiza-tional DNA, he is not opposed to a few “cheap” gimmicks—such as

Methodology

by Paul Michelman

Making Idea Sharing Pay Off

34

Idea Sharing

(continued)


February 2005

one-time bonuses—to help publi-cize the benefits of idea sharing and give it some organizational prominence.

But such tactics can’t become the norm, he says. “You might want to pay off for a few early wins. But at GE, we destroyed all the suggestion boxes. Idea sharing had to be a core part of what we do.” In other words, once idea sharing begins to take hold, you need to quickly rid the company of the notion that idea sharing is some-thing special. To be effective, it must be something routine.

It should be noted that plenty of organizations still believe in the sug-gestion box—in many cases, an elec-tronic version running on the corporate intranet—and have made it part of the corporate culture.

AN IDEA-SHARING STARTER KIT

Mark Turrell, CEO of Boston-based Imaginatik, a software and consultingfirm that specializes in idea management, offers this advice to organiza-tions aiming to develop their idea-sharing muscles:

Focus.

In a distributed organization, random idea sharing has intellectual meritbut tends to disrupt management and business processes. The most suc-cessful systems for idea sharing have focus—they organize employees toconcentrate on specific business challenges over short periods of time.Collecting ideas with focus significantly increases the likelihood of suc-cessful implementation—thirtyfold better than random idea-gatheringmethods.

Know the value of ideas and how to protect them.

Ensure employees know legal rights with regard to ideas so that theyare able to share ideas appropriately inside the firm while protectingtrade secrets and ensuring proper patent protection, if necessary, anddo not accidentally accept ideas from outside the firm with unsurelegal provenance.

Manage expectations.

Most ideas will not be adopted by an organization, and few that areadopted will actually be implemented. To avoid employee frustration anddisenchantment with the program, use good internal marketing, selectcarefully the business challenges you focus on, and put a thoughtful rewardand recognition system in place.

Anecdotes trump hard evidence

Kerr also warns against relying on quantitative data to sell managers on idea sharing. Suggestion systems that trace bottom-line results to the movement of ideas don’t work, Kerr says, because there are far too many variables to be able to make any kind of believable case. “You have to trust anecdotal evidence,” he says. When people stand up at meetings, discuss a success they’ve had, and tie it to an idea that came from elsewhere in the organization, the case becomes pretty persuasive over time.

The value of idea champions

All of this is not to suggest that sys-tems that encourage idea sharing don’t have a place in an organization.

GE, for instance, had structures to help drive ideas across the com-pany—for example, its corporate ini-tiatives group. As Welch discussed in

Jack: Straight from the Gut

(Warner Business Books, 2001), this team of people had a mission to “sell” ideas developed in one part of the com-pany to businesses in other parts of the company and to help business leaders implement them. It was the only corporate staff Welch allowed to grow during his time at GE.

Similarly, the Cary, N.C.–based software firm SAS employs a team of full-time intermediaries whose role is to interpret knowledge developed in one area of the firm in a way that shows its potential value to other parts of the organization. SAS found that while the originator of an idea is generally quite happy to share it, sometimes “those good at originating ideas are not nearly as good at ex-pressing them,” writes Frank Leistner in a 2001 article about the company in the journal

Knowledge Directions.

Indirect incentives beat direct

When Welch took the helm at GE, a large chunk of managers’ annual pay was determined by the performance of the businesses for which they had direct responsibility. Because they were not invested in the performance of other parts of the company, man-agers had no financial incentive to share ideas with other GE leaders.

Under Welch, GE downplayed bo-nuses tied to individual business per-formance while increasing the role of stock options. As a result, GE manag-ers became more invested in the company’s overall success. When you believe a great idea can help perfor-mance elsewhere in the company and you stand to benefit from that perfor-mance, you have greater inspiration to see it implemented.

◆

35


he right approach to generat-ing ideas from your employ-ees creates a virtuous circle,

say Alan G. Robinson and Dean M. Schroeder, professors at the Univer-sity of Massachusetts Amherst and Valparaiso University (Valparaiso, Ind.), respectively. Workers become more engaged when they see their ideas being used. And managers, see-ing the impact of employees’ ideas, give employees more authority—which leads to more and better ideas.

How can you create such a win-win situation? Learn to appreciate the power of small ideas, says Robinson, and throw out any beliefs about the need for financial incentives.

1.

What’s wrong with the typical ap-

proach to idea generation?

Ever since Frederick Taylor argued that

management’s job was to

think

and the

worker’s job to

do,

this has been most

companies’ default perspective. But, in

fact, frontline workers have better

knowledge of the particularities of

products, services, and processes than

managers do. They’re better positioned

to spot problems and opportunities.

2.

What are some of the characteris-

tics of an effective idea system?

Ideas are actively encouraged—from all

quarters. Submitting ideas is simple,

and the evaluation of suggestions is

quick and effective. Pushing decision

making down to the front lines for as

T

many ideas as possible leads to better

decisions, faster implementation, and

lower processing costs; it also frees up

managers’ time.

3.

Why the emphasis on small ideas?

Business leaders are always looking for

the next breakthrough idea—the home

run that will put them well ahead of the

competition with one swing. Because

of this, the systems and policies they

put in place are aimed at big ideas.

Few managers realize how severely

limiting this is. In many important as-

pects of business—customer service,

responsiveness, quality, and manag-

ing costs—you just can’t achieve excel-

lence without getting the little things

right.

At one of the bimonthly idea meet-

ings at Grapevine Canyon Ranch in

southwest Arizona, a housekeeper sug-

gested creating special business card–

sized pieces of paper with spaces for

people to write their contact informa-

tion. From faint imprints left on stacks

of stationery in the rooms, the house-

keeper had realized that many guests

were using full sheets—the only writ-

ing paper provided—to swap names

and addresses with other guests. This

was both inconvenient for the guests

and costly for the ranch.

This one idea didn’t have a percepti-

ble impact on performance or guest

satisfaction. But taken together, all the

small ideas make the ranch’s service

feel incredibly responsive.

What’s more, most small ideas stay

proprietary, whereas big ones don’t. Big

ideas are very visible to your competi-

tors and are often countered or copied

relatively easily. Because there’s no nat-

ural way for competitors to find out

about them, small ideas can add up to a

huge competitive advantage.

4.

How should companies guide

idea generation?

A company’s strategy should help it de-

termine where to concentrate its search

for ideas. Identifying the primary drivers

of performance and then soliciting ideas

related to those drivers—that’s the ulti-

mate alignment tool.

5.

Do organizations need to reward

ideas to guarantee a large flow of them?

Not as much as they think they do. The

Japanese company Idemitsu gets more

than a hundred ideas per employee each

year without offering any bonuses. Be-

sides, many seemingly commonsense

reward plans—for instance, offering a

percentage of the savings or profits

from each idea—turn out to be counter-

productive, creating an enormous

amount of non-value-adding work and

also undermining teamwork and trust.

Most employees have lots of ideas

and would be thrilled to see them used.

They take pride in contributing to the

organization’s success. So the most ef-

fective form of idea recognition is to

implement the ideas rapidly and to give

credit to the employees involved.

If you

do

want to offer financial re-

wards, base them on simple aggregate

measures and distribute them to all

employees, equitably and across the

board.

For example, Denver-based Kacey

Fine Furniture links substantial quar-

terly employee bonuses to perfor-

mance improvements such as reducing

customer returns.

◆

Five Questions About… Getting the Best Employee Ideas

with Alan G. Robinson

Coauthor of

Ideas Are Free

(Berrett-Koehler, 2004)

36

Manage Your Human Sigma


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D.

Companies routinely assess the quality of manufacturing processes. But what about the quality of employees’ dealings with cus-tomers? Each employee-customer encoun-ter—every sale, every call-center conversa-tion—creates

or

erodes value for a company.

Yet most businesses don’t measure or man-age the quality of employee-customer en-counters. If they did, they’d discover ex-treme differences in employee and customer satisfaction across units. For ex-ample, some stores operated by the same retail chain are exceptional places to work and shop; others, awful.

Unpleasant employee-customer encoun-ters damage revenues and profits. How to elevate the quality of these shared experi-ences in

every

part of your company? Start by measuring employees’ and customers’

emotional engagement

with your organi-zation. Why? Energized and committed em-ployees engage customers and work more productively. Customers who feel strongly connected to your company spend more and stay loyal. When employees and cus-tomers are happy, your profits can soar.

By measuring employee-customer encoun-ters in each part of your company, you manage them better—spotting and ad-dressing problems

before

they poison your bottom line. In one study, companies that applied these practices outperformed peers by 26% in gross margins—and 85% in sales growth.

To enhance employee-customer engagement:

ASSESS EMOTIONS

Studies suggest that emotions play a larger role than analysis in people’s decisions. Thus it’s vital to measure your employees’

and

cus-tomers’ emotions. For employees, monitor en-ergy level and strength of commitment. For customers, assess their:

•

Confidence:

Do they feel your company al-ways delivers on its promises?

•

Pride:

Do they identify positively with your company?

•

Passion:

Do they view your company as ir-replaceable in their lives?

MEASURE ENCOUNTERS LOCALLY

High-level assessments of company perfor-mance (“We’re the leader in customer satisfac-tion”; “We’re one of the best places to work”) provide good marketing copy. But they ob-scure performance variation across company locations, and thus don’t give

local

managers the information they need to improve their units’ performance. To address this, measure employee-customer encounters at the work-group level.

Example:

A telecom company formerly measured cus-tomer and employee satisfaction at the company level through random customer surveys and annual companywide em-ployee surveys. But the results generated lit-tle useful information about local conditions. When the company began measuring cus-tomer and employee satisfaction at the work-group level, it gained valuable informa-tion. For example, call-center data revealed that each customer’s experience hinged on the service representative who took the call. The top 10% of reps produced six positive in-teractions for every negative one, while the bottom 10% yielded only three positive for every four negative encounters. Armed with

these insights, call-center managers could reinforce exceptional performance

and

ad-dress poor performance.

CENTRALIZE RESPONSIBILITY FOR MEASUREMENT

In most companies, customer data reside in the marketing or quality department; em-ployee data, in HR; and financial data, in fi-nance. To gain a true picture of the health of employee-customer encounters, bring these data together on one platform. Assign respon-sibility for measuring and monitoring the health of the employee-customer relationship to a single organizational structure, with an executive champion who has the authority to initiate and manage change.

DEVELOP LOCAL MANAGERS

Local managers strongly influence their em-ployees’ engagement and thus performance, retention—and customers’ experiences. En-courage managers to use training, perfor-mance reviews, and coaching to foster em-ployees’ learning and correct performance shortfalls. Support managers with similar tools. If interventions don’t improve local per-formance, replace managers.

by John H. Fleming, Curt Coffman, and

James K. Harter

37


our ability to use your time as effectively as possible is jeop-ardized at every turn. New

priorities spring up like dandelions in May. Strategies shift, market condi-tions change, and unforeseeable cri-ses demand immediate responses.

But if you look closely, you’ll see that most time-management prob-lems don’t arise from such external factors but rather from internal ones: they stem from deeply embedded in-dividual habits, which, thankfully, can be corrected.

One of the most nefarious time robbers is overreaching. Many ambi-tious and dedicated managers take on new tasks without thinking about how they’ll actually get the work done. Their desire to confront new challenges and build their organiza-tional value blinds them to the reali-ties of their workload. In the end, they accomplish nothing well.

With the help of

Manager’s Toolkit: The 13 Skills Managers Need to Suc-ceed

(Harvard Business School Press, 2004), we look at how to defeat sev-eral of the most common manifesta-tions of overreaching.

Know your key responsibilities, and focus on your top-priority goals and tasks

With continually shifting strategies and top organizational priorities, this is no easy task. Once a week, look at your current to-dos and prioritize them based on which have the biggest potential impact on the short- and long-term goals of your unit, your company, and your career.

Y

Also, consider which could have the biggest negative impact if they don’t get done. It never hurts to have a sounding board in this effort. Look to colleagues, managers, and even direct reports for their thoughts and input from time to time.

Learn to delegate effectively

The experts offer a couple of sugges-tions: when making assignments, think about the match between em-ployees’ skills and the tasks you’re giving them, and make sure you are directing employees to the resources that will help them.

As many effective managers will attest, asking trumps telling in the art of delegation. Engage an employee in a new assignment with questions such as, “What do you think should be done?”

This also conditions employees to come up with solutions to problems on their own instead of always pass-ing problems on to you.

Resist the urge to step in and take over because someone isn’t doing his job or not doing it to your standards

This is a tough one, particularly in the face of the kind of pressure most of us experience today, but it will save a great deal of time in the long run if you resist the urge to take over and “fix” things.

Instead, provide the support em-ployees need to improve their own performance. Serve as a sounding board, ask probing questions, and lead someone in a new direction,

but keep the burden of producing the desired result on the shoulders of the person to whom you gave the assignment.

If, with proper direction, an em-ployee cannot deliver what you need, then you’ve learned something valu-able about that employee’s capabili-ties—something that can save you a lot of time in the long run.

Don’t assume that everything has to be done

Some things aren’t important, but it’s true that everything is important to someone. When deciding to let a project fall by the wayside (or even when moving it to the back burner), it’s critical that you articulate to stakeholders why you are doing so.

Learn to say no when added responsibilities threaten your effectiveness

As with the previous point, saying no is a lot easier when you can articu-late

why

you’re doing so. The why of saying no becomes clear once you consider the consequences of saying yes—namely, destroying your ability to get higher-priority jobs done on time.

This can make for a difficult conversation, especially if senior managers have a stake in a particular assignment. So make sure your re-sponse is specific and couched in the language of company strategy.

◆

Executive Toolkit

by Paul Michelman

Resist the Urge to Overreach—and Win Back Valuable Time

38

Five Questions About…Encouraging Managers to Delegate

with Jeffrey Pfeffer

Stanford University Professor of Organizational Behavior

anagers’ common reluc-tance to delegate responsi-bility is a topic that has

long intrigued Jeffrey Pfeffer, coau-thor, with Charles O’Reilly, of Hidden Value: How Great Companies Achieve Extraordinary Results with Ordinary People (Harvard Business School Press, 2000). Pfeffer says that there is mounting evidence that giving peo-ple more responsibility for making decisions in their jobs generates greater productivity, morale, and commitment. Yet despite these bene-fits, many managers are reluctant to cede control. We recently asked Pfef-fer, whose research helps explain the reasons for such reluctance, what companies can do to overcome it.

1. What is the most effective step

companies can take to encourage man-

agers to delegate more responsibility?One of the primary ways we learn is by

observing what people around us do.

So, if I want you to delegate more and

micromanage less, then I need to reflect

that in my own behavior. The first place

every manager looks to determine the

most appropriate way to act is at their

superiors.

2. How do you persuasively

describe the value of delegating

to a subordinate?I don’t think one “describes” the value

of delegation, at least as a way of

changing behavior. The best thing to

do is some form of experiential exercise

in which people are “shown” the bene-

fits of delegation and the costs of not

M

Copyright © 2004 by Harvard Business School Pu

doing so. Some of those exercises in-

volve problem-solving exercises in

which people learn that not accessing

the expertise of others leads to worse

solutions. Some of the exercises involve

having people be supervised. The most

powerful is called “star power” and has

people experience what it is to be pow-

erless—something that provokes

strong reactions, to put it mildly.

Believe me, “telling” people the bene-

fits of delegation has no effect at all, as

the failure to follow the advice of the

numerous books and articles that do

just that attest.

3. Is organizational structure a factor?Absolutely. It affects behavior in two

ways. First, it sends signals to managers

about the type of behavior the organi-

zation finds most acceptable. For exam-

ple, in a relatively flat organizational

structure where there are few manage-

ment layers and managers have broad

spans of control, people understand

that delegation is the norm. Second, in

a very real sense, structure either facili-

tates or hinders delegation by the na-

ture and strength of the boundaries it

erects.

One way companies can compel

increased delegation is to assign man-

agers larger staffs and more responsi-

bility. The larger a manager’s staff

becomes, the less he/she will be able to

micromanage them.

4. Is there too much focus being

placed on leadership?Yes, and the problem extends beyond

companies to include the business

blishing Corporation. All rights reserved.

press, but that’s another story. If your

organization venerates heroic leaders,

then your managers are going to

have a natural reluctance to delegate

responsibility.

One of the ways companies en-

courage heroic leaders is by providing

them with a host of highly visible

trappings, from elegant offices and

reserved parking to executive dining

rooms and travel on private jets. It’s

frequently difficult for managers

with such perks to entrust responsi-

bility to subordinates whose trap-

pings are significantly inferior to

their own.

Organizations in which the spirit of

delegating prevails tend to be those

with an egalitarian culture that is man-

ifested in such things as open office ar-

rangements and the lack of status

symbols. These help build the sense

among workers that they are relatively

equal.

5. Can recruiting be employed to

encourage delegation?This is another important step that

companies can take. Hiring people who

are by nature autocratic will certainly

mitigate against building an organiza-

tion that values teamwork.

How do you determine a candidate’s

management style? Unquestionably,

the most reliable predictor is past be-

havior. Management style reflects a

certain mindset and therefore is diffi-

cult to change. So companies should

look carefully at the ways candidates

have approached their responsibilities

at their prior employers.

Related to past performance is the

nature of the management environ-

ment in the organizations where the

candidate has worked. If they fared well

in an organization that’s known to be

team-driven, then they’ll likely be com-

fortable with delegating responsibili-

ties in their new role. �

39

T H E I D E A

Your proposal was brilliant, your logic unas-sailable, your argument impassioned. So whydidn’t your CEO buy your proposal?

Chances are, you took a one-size-fits-allapproach to persuasion. But different execu-tives use different styles when deciding whether

to accept an idea: Each wants certain kinds ofinformation, at specific steps in the process.

One decision-making style isn’t better thananother. But to tip the outcome your way, youmust understand your listener’s preferences—then tailor your persuasive efforts accordingly.

Change the Way You Persuade



I N B R I E F

StyleDecision-Maker’sCharacteristics Persuader’s Strategy Examples

CH

AR

ISM

ATI

CLe

e Iac

occa

,Her

b Ke

llehe

r Easily enthralled,but bases final decisions on balanced infor-mation

Emphasizes bottom-line results

Focus on results.

Make straightforward arguments.

Stress proposal’s benefits withvisual aids.

Use buzzwords: proven,actions, easy, clear.

Diagrams current organization and problems,proposed restructuring and benefits—especiallyimproved competitiveness.

Explains potential challenges (resistance to staff relo-cation) and risk of inaction (losing largest customers).

Provides detailed reports for CEO to review post-presentation.

THIN

KER

Mich

ael D

ell,B

ill G

ates

Toughest to persuade

Cerebral, logical

Risk-averse

Needs extensivedetail

Present market research,customer surveys, case stud-ies, cost/benefit analyses.

Use buzzwords: quality,numbers, expert, proof.

Presents three different options in detail in first meeting.

Explains data-gathering methods.

Presents case studies of similar restructurings.

Uses second meeting to fill argument gaps and recommend optimum plan.

Waits weeks, months for CEO’s decision.

SKEP

TIC

Larry

Ellis

on,To

m Si

ebel

Challenges every data point

Decides based on gut feelings

Establish credibility withendorsements from someonethe CEO trusts.

Use buzzwords: grasp, power,suspect, trust.

Co-presents with trusted COO.

Emphasizes information sources’ credibility.

Strokes CEO’s ego (“You’ve probably seen this casestudy…”).

Grounds arguments in real world.

FOLL

OW

ERPe

ter C

oors,

Carly

Fior

ina Relies on own

or others’ past decisions to makecurrent choices

Late adopter

Use testimonials to prove lowrisk.

Present innovative, yet proven,solutions.

Use buzzwords: expertise,similar to, innovate, previous.

Highlights case studies from other industries, butnotes,“We could be the first in our industry to do this.”

Omits failed restructurings (though retains informa-tion in case CEO requests it).

Presents three restructuring options.

Uses multiple references to steer CEO toward herpreferred choice; emphasizes option’s affordability.

CO

NTR

OLL

ERRo

ss P

erot

,Mar

tha S

tew

art

Unemotional,analytical

Abhors uncer-tainty

Only implementsown ideas

Present, highly structuredarguments.

Make listener “own” the idea.

Avoid aggressive advocacy.

Use buzzwords: facts, reason,power, just do it.

Over several months, continually sends CEO customerreports, marketing studies, financial projections.

Emphasizes data highlighting company’s problems.

Identifies data contradictions, letting CEO analyze them.

Waits for CEO to request meeting after large customer defects.

FIVE DECISION-MAKING ST YLES

Consider this fictional scenario: Sales and Marketing VP Mary Flood knows her company mustbecome more customer focused. She recommends decentralizing her operations into regionalaccount teams—but needs her CEO’s support. Here’s how she’d argue her case, depending on her CEO’s decision-making style.

40

by Gary A. Williams and Robert B. Miller

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