I know what success looks like. I have been consulting executives for the last 15 years – as an external management consultant, as a strategic planner, or as a organization design project lead. Spent a fair amount of time with CEO, COO, CFO, VP of this, and Executive Director of that. The majority of our clients have organizations with $500M – $5B in revenues, not small.
From this diverse experience, and the fact that I am just getting older, I think that it helps to make things simple. Organizational success comes from getting smart people, developing a strong sense of trust, and setting a clear (and flexible) direction.
I find myself explaining this simple formula to clients, and also potential recruits.
Direction. Executives . . .please listen to this. You have to tell your people where you are going, and what you expect of them. It should not be a 36 page powerpoint or a 80 page strategic plan. Make it simple. Make it clear (and flexible). You cannot prescribe every single action you expect of people. Assume the message will get diluted and poorly communicated. Make the goal and strategy easy to understand and implement.
- What are we (the organization) trying to do?
- How are we different from others? How to use those strengths?
- What are our values and what type of people do we want to recruit and retain?
- What are we NOT going to do?
- Who are we serving?
Smart people. I mean this broadly to mean people who are not only intelligent, but have common sense, can think outside of their designated silos (be it finance, supply chain, HR or otherwise), have an attitude of learning, and get things done. Clearly my definition of smart people is broad:
- Lazy people are not smart
- Selfish people are not smart
- Fearful people are not smart
- Jaded people with no hope are not smart
- People who think they are smart, are not smart
As Jim Collins famously said, “you have to get the right people on the bus, in the right roles” Wrong people = fail. The wrong people create more confusion, rework, and overhead than if you had not hired anyone at all. Recruiting people who are a good fit is difficult and incredibly important. As a HR friend once told me, “hire slow, fire fast”.
Trust. Effective consulting teams are all about people, and trust. If you cannot trust your manager, peer, or analyst, there is no leverage model. Everyone has to double check everything, and the levels of overhead and bureaucracy multiple. Organizationally, when there is no trust – you have to develop deep personal relationships individually with people to get things done. Trust becomes something unique that some people have and others don’t. In other words, it becomes Game of Thrones. Alliances, favoritism, reciprocity, long-standing memories, and pettiness.
This is probably the most important of the 3. A culture of trust will help you to collectively set the right direction, recruit and retain smart people. A lack of trust obfuscates direction and turns smart people away.
When I think back on all the clients I have served and those my friends have worked with. . .most business problems fall into a combination of these problems:
- Unclear direction confuses mid-level managers
- Mixed messages from different groups – finance, HR, operations, marketing – which create a knee-jerk reaction to solve the problem of the day
- New management sets a new direction, with only limited acknowledgement of what successful things came before. New executives come in an “clean house”
- Outsourcing of strategy to consultants – executives get so “busy” with their lives, that they ask management consultants to help decide for them, what to do
Lack of Smart People
- Leaders who insulate themselves, not getting real-time feedback from below
- Rewarding the wrong behaviors and non-performance
- Allowing bad behavior (rivalry, gossip) to persist
- Placing people into roles they are not qualified for
- Acting too quickly to recruit from outside, rather than nurturing leaders internally
Lack of Trust
- Inactivity and slowness because people have to “check with their boss”
- An over-emphasis on “consensus building” because people don’t want to be perceived as being selfish or going rogue
- Intolerance of innovation-driven failures
- Over-reliance on benchmarks and canned, industry best practice answers
I respect CxOs and the burden they carry. Effective leadership and management are difficult. I am not a CxO. I have not had the burden of $MM of budget and thousands of employees. I have not had the burden of Wall Street analysts picking apart my comments. I have not had lawsuits against me for my actions as a Chairman of the Board. I have not managed a global organization 30 VPs wanting my attention 24/7.
For all the reasons above, my appeal is simple. Set the direction, hire and cultivate smart people (broad definition of course), and create a culture of trust. Amen.