March 2nd, 2010
I was speaking to a group of CEOs recently and as their meeting started it was apparent that at their last meeting each one had identified a single high priority task they had to get done. Yet a month later, some were not even able to recall what their high priority was let alone a poor general showing on getting them done. Why is this? Why do senior executives/owners take priorities so casually? If they committed to their fellow group members to get these priorities done, how could they show up and either fail to even remember what the task was or worse, admit they had done nothing about them?
Accountability seems to be one of the toughest things even for CEOs and I am at a loss to imagine showing up at a meeting and admitting to my peers that I didn’t take my commitment very seriously. In my days as an executive and multiple time CEO I would have done WHATEVER was required to get something done rather than show up and admit I had done nothing! Where has pride, ownership, setting the example, role modelling gone for CEOs? I don’t get it.
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November 15th, 2009
While facilitating a two-day annual strategic planning meeting for a long-time client the other day, a major discussion erupted over the apparent need for a “new” strategy. Obviously, the economic conditions of the past two years have negatively impacted most companies to some degree, and this client was no exception. But they have stabilized and rightsized the company, have positive cash flow and are poised to take some market share from weakened competitors as they come out of the recession.
I was quite intrigued about the stated need for a “new” strategy (which was only supported by about half the executive team), because three years ago they spent a significant amount of time and effort crafting a new strategic plan with four main threads and clear strategies, tactics and measurable goals for the short-term (0 to 2 years), mid-term (2 to 5 years) and long-term (5 or more years). Admittedly, the recession interrupted progress on some of the goals, as they refocused on the need for immediate actions to maintain cash flow and deferred some of the items. But it was nevertheless interesting to see how quickly the team forgot about all the high quality work they had done to create a great vision, seeming to think there was some new strategy or silver bullet they could or should pursue.
I listened carefully to the debate and finally weighed in re the existing vision and strategic plan. My question revolved around whether there was a problem with the vision and plan, or whether the problem was with execution. In addition to the challenges of the recession, there had been some turnover on the senior leadership team, some accountability had slipped, certain initiatives had not been completed as expected, and they had allowed other short-term hot issues to pre-empt their long-established meeting rhythm. I had already been warning them about some of this laxness, which was being excused by the need to respond to the recession. I had pointed out that in tough times, priorities, accountability, meeting rhythm and execution are even more critical and stabilizing. I challenged the assumption that something was wrong with the vision or strategy, and proposed that if they would get back to solid execution, in my opinion they could return to excellent results.
None of us has ever faced the depth of recession we have just experienced, and it was scary. But for those of us “gray hairs” who have lived through three or four recessions in our business careers, we know how to survive. And typically the answer is not to try and dramatically change the vision and strategy but rather to adapt to the new normal we will face, set appropriate priorities and execute like crazy. Rarely in my career have I seen a situation where something was drastically wrong with the vision and strategy; the problem usually is the execution. Remember, an average quality vision well executed is far better than the best vision in the world that is not fully executed.
Worry less about the vision and more on the team, alignment and accountability to execute your existing vision. As Jack Welch says in his book Winning, set a general course of action (since it will most certainly change and seeking perfection takes too long and is too expensive), put the right people in place who can execute the vision, and constantly benchmark best practices to improve execution.
Tags: Strategy
Posted in Strategy | 23 Comments »
September 30th, 2009
I recently completed a two-day strategic planning meeting with a two year client. The CEO informed me that they change facilitators as a matter of course every two years just to get a new approach. My first reaction was somewhat defensive, i.e. did I do something wrong, how could you make such a decision, etc.
And then I stepped back and realized that he feels strongly that this approach works for his firm, and he has the power to make that decision. I must say that it strikes me as shortsighted for two key reasons:
1. The CEO and his executive team have paid for two years of my education about their business. We find that the first 18 to 24 months are mostly process and good habits for creating a vision and executing it. Then our role switches to more content as we have learned about the business and can make suggestions. To have spent the money for two years to educate me and then to switch facilitators strikes me as throwing away the money and ending an engagement just when it would begin to have the most value to them!
2. From a continuity standpoint, I always counsel CEOs to pick a process (not even mine, just some process) and stick with it. Changing planning methodologies for any reason other than total dissatisfaction with one seems to be a distraction for an executive team. Clearly if a process isn’t working, get rid of it. But if a process is getting rave reviews and the company is enjoying record performance, why in the world would you want to subject executives to having to learn something new?
I sound defensive to myself as I read this so take it for what it is worth: a blog with my personal opinions, valid or not.
Tags: Strategic planning process
Posted in Strategy | 15 Comments »
July 15th, 2009
I have always thought that great CEOs suffer from a healthy dose of paranoia. Just when things seem to be going right or there has been a great victory, they are often the ones who bring things back to a more normal plane. I don’t mean that celebration, recognition and reward are bad, just the contrary; they are essential to great company cultures. But one of the four things CEOs are responsible for is setting direction for their companies, and asking tough questions just when everything seems perfect is part of that healthy paranoia. Just when everyone has been flying high for a bit, great CEOs often ask “So what is the worst thing that could happen to us?” or “What is the thing just around the corner we haven’t thought of that could really hurt our business?”
Asking those tough questions that no one else does is the connection to the economic rebound that is going to happen at some point. Even while things are still challenging, volumes are down and margins are under pressure, great CEOs are already preparing for the turn. They challenge strategy, upgrade bench strength, and rationalize locations and non-performing products, all with an eye to how to best position the company to take unfair advantage of the upturn. Not just ride the economic wave upward, but gain market share at the expense of weaker competitors and gain business without having to buy any other companies. Great CEOs constantly mine the talent pool, courting and subtley wooing the best executive and managerial talent long before there are any openings at their company. As David Packard and Bill Hewlett often said when they started HP, when you find an “A” player executive hire him or her! You can never have enough “A” player executives and fortunately these caliber people can often lead many different functions in a company.
So how much time are CEOs planning for today vs the future and how do they position their companies to take advantage of a strengthening economy? Measure your own today vs future ratio as a check on whether your focus is in the right place.
Tags: execution, planning, rebound
Posted in Strategy | 13 Comments »
June 24th, 2009
I just finished an annual two-day strategic planning meeting with a company executive team; this was the third strategic planning meeting I have facilitated for them and I have been working with them for three years. They are a several hundred million privately-held company that sells its products through various small to very large retailers around the U.S.
For the last two years they have pretty much continued down a path of filling in a very broad product offering (“an inch deep and a mile wide”) so they could be known for a rather complete brand in a specific segment of their market. As one would expect, some categories and products had relatively minor impact, contributed little and were a distraction from the several core products that they are known for and best at. As usual, it was a case of thinking that they had to dominate by breadth but the resulting workload caused too many priorities, “widow-maker” executive roles and unacceptable quality at times.
In their meeting this week we really got into the strategic direction issues and alternatives to an inch deep and a mile wide. The team did a great job probing their direction from a number of different perspectives and with the full support of the CEO who encouraged the vigorous debate and potential changes in direction. He had developed a product roadmap that showed for the first time the wide proliferation of products and how that complexity could become a barrier to their profitable growth.
To their great credit, the team acknowledged that they could not be everything they were trying to be and generate the profitable growth and quality they were all committed to. They have set a new path to segment their categories into a few that will be an “inch wide and a mile deep” and will get intense focus and management, and those that will be maintained but not invested in and may help fund the core group. This decision will have significant implications on the org chart of the future, the manufacturing and systems capabilities and capacities required, and how the executive team will lead the company. But what a breath of fresh air and the excitement of stepping up to the plate and relaizing they had to say no to certain things to be good at the most important ones. It was great watching a group of very talented leaders deal with the toughest issues and decide they wanted to be more like Hedgehogs than foxes. I will enjoy watching them become a great company in future years.
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April 21st, 2009
A client recently added a new member to its executive team, and this individual’s behavior during meetings really caught me off guard. He is an extremely intelligent and experienced executive and has contributed a lot in a short time. But during executive team meetings he fidgets, stares out windows for long periods of time, not even facing the table where his team mates are sitting, works on his PDA and often leaves to take/make calls in the middle of meetings. He has even walked out of scheduled all-day meetings several hours early!
In discussion with the CEO it is clear this executive apparently has a strong case of ADD and that is his personality. But what a distraction to and lack of respect for the rest of the team; in fact his behavior is so disruptive that it may ultimately impact the ability of this group to be a team.
The ironic thing about this behavior is that this executive recently recommended to the CEO that there were too many excutive team meetings and they could and should be shortened or eliminated entirely. His thought was that an all-day quarterly meeting could be done as a “lightening round” of three hours with just the five executive team members instead of the entire senior management team which has been the case since before he arrived. I wonder why he would recommend this? Is it in the best interest of the company or is it driven by his own personal ADD issues?
What he doesn’t get is that execution is a process that cannot be rushed. The only way great companies execute their strategic plans is 90 days at a time. The debate and discussion among team members is an essential part of corporate learning and is critical for alignment and a culture of accountability. Sometimes the process of getting to the answer is as important as the answer itself. But of course, when driven by ADD, an executive might let his personal shortcomings influence what is best for the company.
Every time in the past 10 years that a company has decided they can shortcut the meeting rhythm, bad things have happened. Eliminate or shorten other meetings or engage a time management expert to improve how executives spend their time, but don’t shortcut the executive team’s meeting rhythm. What in the world would be more important than spending quality time together focusing on the most important goals for the entire company?
It will be interesting to watch how this CEO deals with this unproductive and dysfunctional behavior. It has the potential to move this group backwards and destroy much of the alignment and accountability that has been created over the past year.
Tags: Meeting rhythm
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February 26th, 2009
I recently facilitated a quarterly executive team meeting for the most successful of four divisions of a mid-size, privately-held company. Recently, the President of that division and three of his lieutenants had informed the company owner/CEO that they would leave unless certain things were changed to better reflect their division’s performance and metrics. After much negotiation and much angst over the prospect of their departure, the owner/CEO refused to meet their demands and the four executives left and started a new company that competes in some tangential areas.
Everyone was on bated breath, waiting to see what would happen with employees and key customers upon the announcement of the departures. Today’s meeting really answered my own questions about the impact:
1. The leadership team has actually pulled together as often happens in times of crisis,
2. The atmosphere in the meeting was more relaxed, open and honest than ever before with the tough issues being addressed without fear of criticism as in the past,
3. Clients have been contacted and not one of any significance has left,
4. There is a very detailed and appropriate plan in place to move the division forward.
Several conclusions on my part:
1. No one is irreplaceable despite how we build this up in our minds,
2. The downside is rarely as big or awful as our minds imagine,
3. Doing what feels right (as the CEO did in ending negotiations and not being held hostage to a single division) usually turns out to be the right thing,
4. A company and its reputation is bigger than any employee or executive, and rarely are customers “owned” by an individual (as opposed to the company).
Great example of leadership and doing the right thing. It reminds me of Malcolm Gladwell’s book Blink about trusting intuition and how often the resulting decision is better than one supported by all kinds of data and analysis.
Tags: leadership CEO
Posted in Leadership | 10 Comments »
February 21st, 2009
Jim Collins coined the phrase in Good to Great, meaning CEOs have to deal with the toughest issues, listen to the bad news, control the inclination to be defensive, have and nurture “tenacles” throughout the organization to be sure they are getting the really important information, and finally , never become an emperor with no clothes. But it is really hard to do!
Many owner/entrepreneurs just refuse to accept that the only guarantee in business is that jobs will always outgrow people. They usually have a wonderful sense of loyalty toward the people who have helped them start and grow their company; unfortunately many of these leaders are blinded by that tenure and past contribution and just cannot recognize when one of their executives is no longer able to contribute to the company as they once did. Often that executive was an “A” or “B” player (Topgrading, Bradford Smart, 1997) when the job was smaller and/or less complex. But they have not been able to keep up with the requirements of a larger more complex responsibility and often become “C” players. Facing that reality is extremely difficult and stressful for most owner/CEOs. But putting any single individual’s welfare above that of an entire company is just irresponsible.
Ask the powerful Jim Collins question: “Knowing what you know today, would you hire that individual today for the same position?” If you cannot immediately, without reservation or hesitation answer “Absolutely”, there may be a clue that you need to face the brutal facts. Maybe there is another “seat on the bus” for that executive, or maybe you will have to help him find a seat on another company’s bus. But ignoring this brutal fact puts a CEO into that category of executive who mistakenly hangs on to the philosophy that “a warm body is better than nobody.” And in our current economy, there is an opportunity to upgrade those “C” player executives with available “A” players.
Posted in Leadership | 2 Comments »
February 18th, 2009
So many companies have wonderful three ring binders filled with strategic plans that sit on someone’s shelf and gather dust 11 months of the year. And then around the end of November someone pulls out the binder wondering “What did we say we were going to do this year and now we only have a month to do it!” What a waste of time!
I had a call from a CEO of a $180 million company who said he understood that we lead strategic planning retreats/meetings. I acknowledged that we do, but only if it includes a path to execution and results. The CEO said they had been using the American Management Association (AMA) strategic planning process for six years and that it was great. Every year for six years the CEO had taken his executive team to a beautiful resort for three days of planning with some great results.
I complimented him on embracing a planning process and asked if it was so good, why was he calling us. His answer knocked my socks off but is far too frequent: “In six years we have never really implemented anything that came out of the planning process.”
Choose The CEO Advantage, the AMA process or any process! Just make sure there is a path to real-world execution and results!
Posted in Strategy | 5 Comments »