Recent speech from the Simon Sez event on March 12, 2013… How do you live? Or perhaps more to the point, how will you live?
“You were wrong,” Phil stated confidently.
“How so?” I asked, though I could tell where the conversation was going. I had worked with Phil and his team several years ago. With a couple dozen employees and ten million in sales, we implemented a strategic alignment of the business; a process of creating the foundational vision, mission and values along with the strategic processes to achieve the business objectives.
“Our growth,” he continued. “We are achieving what we set out to do, but it hasn’t happened like you said it would.”
I don’t ever recall telling him how it would happen, but I wasn’t going to argue the point.
“When we put our plan together for how we would get there, we calculated it would take a double digit growth rate, year over year. We were on track the first couple of years, then the economy dumped and our sales went flat. Then we had a down year. We all took a pay cut to avoid laying off anyone.”
“Good for you Phil. Sounds like to you did the right thing.”
“Yeah, but my point is the goals and metrics became so unbelievable that I finally stopped sharing them. They became meaningless.”
“So, what did you do?”
“I told them to just focus on their job and I’ll worry about where the business is going.”
Phil’s reaction is an all too familiar refrain I hear from many businesses owners. When things are going as planned managing the business is easy. The truth is however, we are learning much less when business is going as planned than when it isn’t. It’s not easy to do, especially when everyone is looking to you for answers. Rather than bailing on the process as Phil did however, there are some simple steps you can take to stay the course, as follows:
- Have a defined goal – As simple as it sounds, many leaders fail to clarify what the target is yet they expect the organization to perform as if they should know, or worse, as if it doesn’t matter. Don’t kid yourself…it matters!
- You don’t have to know all the answers – The sooner you stop acting like a problem solver, the better. Become a solution promoter, viewing problems as an opportunity to involve employees in the problem solving process.
- Seek small, successive wins – One of the biggest temptations when things aren’t going as planned is to look for big win. While understandable, it is not a recipe for success. Stay the course and seek small but measureable successes. A popular refrain of a friend and sales mentor, Jerry Vieira of QMP Associates is, “succeeding in business comes from doing a thousand small things right.”
- Be patient and persistent – Edison once said, “most people don’t realize how close they were to success when they gave up.” You are likely closer to success than you think.
- Don’t miss the larger moment – Whether you recognize it or not, you are modeling how to lead through challenging times. How you choose to act today will likely become the standard for the team tomorrow.
Yes, Phil is experiencing success. The larger problem he hasn’t recognized however is it is largely on his back. It is arguable whether the team has learned anything other than to keep their heads down and not ask questions. While it may have worked for Phil this time, he’s done little to prepare for tomorrows challenge. Either Phil can start working with his team to become part of the solution, or he’d better make sure he has his A-game on. It’s not a matter of if the next challenge comes, but when.
Take the time to start working with your team to manage the gap and you will create a foundation for performance that will pay off when it really matters.
American business is at a unique pivot point in history. With the tidal wave of retirements by Baby Boomers upon us, and the influx of Millennials beginning to shadow the doorways of businesses across the country, at no other time in the history of our economy has the potential existed for a transfer of wealth on a scale we have never seen. And yet with all the promise, the daily busyness keeps us from asking the deeper and more profound questions we as business owners should be asking—what legacy are we leaving, and as importantly, to whom?
Show me the money
According to an Accenture report (Jun,’12), the total wealth that will be transferred by 2045 is in excess of $30 trillion dollars. Further, according to another study by the consulting firm Fair Market Valuations, this wealth consists of 7 million companies, owned by Boomers between the ages of 44 – 62. The Family Firm Institute concludes that only 33% of those companies will successfully transfer their business to the next generation. The implication is 67% of you will not succeed in transferring your business to your kin, and will be left fighting for buyers the open market. Businesses are no different than real estate—when the supply is high, the prices are low.
Under the hood of the demographics
Millennials, born between 1983 and 2001 (aka Generation Y), represent the largest demographic wave, (~80M) to enter the workforce since the Baby Boomers (~76M), born between 1944 and 1966. As many of us have experienced, Generation Y is wired very differently than those preceding it. The majority of Gen Y have never known a time when instant access to information has not been at their finger tips, and has created a culture that is demanding, ambitious and creative, yet dismissive of the hallmarks of success highly regarded by their parents. The definition of the American dream is literally being redefined and the influencers are no longer contained within our communities or even this country.
Getting to legacy
Within this dichotomy of experiences and values lay both the challenge and the promise of success. I have had the opportunity to facilitate a number of family business successions and the consistent challenge in the process regardless of the industry, size of business or background, is the inability between the exiting and entering generation to define common ground. This “value gap” is further compounded by the myopia on means, namely money and control, versus the vision, values and legacy impact the family wealth will ultimately have.
In our family succession engagements, (of which by the way, I do in collaboration with qualified wealth advisors. I have worked with Pilot Wealth Management, www.pilotwm.com, and have found Jason and Nick to be outstanding in their focus on creating value for the client), we focus on the big picture by asking three key questions:
What legacy do you want to leave? I love this question because it is the most difficult for business owners to answer (let alone most anyone else!). Yet this is what it’s all about—creating legacy. While the dictionary defines legacy as a gift or inheritance, we like to look at legacy more broadly—the impact the wealth will leave on successive generations. The longer the impact, the greater the legacy.
To whom do you want the legacy to benefit? Simply put, this is about being clear in who is being granted the responsibility for stewarding the legacy, and what the frameworks and support mechanisms are required to ensure it sustains.
How will the legacy be managed? This is the leap of faith most of you will struggle with. The reality is, unless the incoming generation is given the opportunity to co-create the vision and values, you will never find peace in letting go and allowing them to steward the resources.
If you are like most business owners that find all kinds of reasons not to begin these conversations, then put down the smartphone and start asking the questions. You are in a race to see who can preserve and sustain the legacy of your hard fought efforts. Don’t let yourself be left in the cold with the rest of the 67%!
Key performance indicators are only as good as the plan that is built behind them. In this video you will learn the five critical principles necessary to put the meaning behind your organization’s KPIs. These include knowing what the goal is, looking for small wins, be a solution facilitator, be patient and monitor your daily responses.
“How’s the job going?” I asked my daughter recently, home from college for the weekend.
“Oh-my-gosh Dad,” she said with not so subtle disgust. “What is wrong with people?”
“What do you mean?”
“My manager. I received an email from him this week explaining he is unhappy with my organization (she works at the library). He wants me to talk with one of the other employees about how to improve it.”
“Is he right?”
“Maybe,” she said thoughtfully. “But that’s not the problem. It’s how he communicated it that’s so lame. I mean, he passes my desk all the time and all he’s ever done is smile and say hello. Never a word about my work though, and then I get this email from him.”
I bit my lip to hide my smile while she ranted a bit longer. “What would you have preferred he have done?” I finally asked.
“Tell me to my face he doesn’t like my work, but don’t send it in an email!” she said with sparks in her eyes.
“So you’d like him to let you know he is unhappy with your performance right then and there?”
“Well, yeah. I mean, respectfully of course. He doesn’t need to rub my nose in it or make me feel stupid. But be honest. Tell me what I’m doing wrong so I can fix it.”
We discussed it further until she agreed to address the issue with him in person. “Are you willing to demonstrate to him what you are asking for yourself?” I asked.
“I guess,” she said, walking away with a heavy sigh. The conversation got me thinking though about the challenges of communication in leadership. Admittedly, while technology has made many things simpler and more efficient to communicate, it has complicated things at the same time. Like when giving an employee feedback. If anything, the multitude of communication forms have undermined a leader’s efforts to project a competent image. Ironically, my daughter’s generation, the Millennials, are criticized more than any other demographic for avoiding direct communication. It heartens me to hear then, that with things that really matter such as performance communication, she desires the direct feedback no less than her elders.
But back to the issue…how can leaders effectively deliver or receive communication? Simply, the art is in the method and when done capably, improves the performance of the team. Thus it is essential for leadership to get it right and following are some simple steps:
Delivering performance feedback
Focus on place & delivery. For place, praise in public, discipline in private. Above all else, maintain the dignity of the person you are directing feedback to at all times. For delivery, think of a sandwich–affirmation, correction, affirmation. Let them know your appreciation for their efforts on the job. Deliver the correction, focusing on the issue, not the person. Be clear what your expectations are and when they need to be fully met. Lastly, finish with affirmation. Let them know you are here to help and want them to succeed.
Receiving Performance Feedback
Focus on setting and posture. For setting, you may be confronted with feedback in a public place and you need to decide quickly whether you can have the discussion in public, or not. The goal is to put them at ease while maintaining the appropriate confidentiality. Remember also that it is difficult for many to give feedback to others. To provide it to their manager? Even more so!
With posture, pay attention to the nonverbal message you are communicating. Avoid crossing your arms or appearing in any way defensive. Maintain a neutral posture and use the three second rule–counting to three before responding to any feedback. This is really important, especially when the feedback is difficult to hear. Lastly, finish with praise. Even if you did not agree with it or was difficult to hear, let them know you appreciate them coming forward. Remember, you are the one setting the tone for your company or area of responsibility.
Mastering communication is essential to your success as a leader, a lesson no doubt my daughter is well on her way learning. Something we can all benefit from