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Archive for the ‘Leadership’ Category

When Superstars Become A Problem

Friday, July 2nd, 2010

One of the most challenging decisions business leaders face is when their superstar becomes a problem. You know the person. Maybe its a sales manager that customers love, yet employees hate. Maybe it’s a V.P. that holds tremendous knowledge, yet disrupts every meeting at the last minute. Or maybe its an executive that believes corporate ethics and values don’t apply to them.

So how do most people cope when situations like these occur? Most people simply cope by getting out of the way or they leave  the organization. The impact on the organization - can be HUGE.

Yes, most of us have worked with one or reported to one of thse bigger than life characters in our careers. Unfortunately, it’s a problem that is often avoided or neglected, which pulls it under the umbrella of being a silent problem.

A couple of weeks ago the Rolling Stones published a riveting article titled The Runaway General. A story about General Stanley McCrystal, the former head of Afghan military operations. It’s a troubling story, because it’s a “when a superstar becomes a problem” story. Its a story about how an individual rose up through the ranks, yet what brought him down was his own weaknesses. For instance the story states,

By some accounts, McChrystal’s career should have been over at least two times by now. As Pentagon spokesman during the invasion of Iraq, the general seemed more like a White House mouthpiece than an up-and-coming commander with a reputation for speaking his mind. When Defense Secretary Donald Rumsfeld made his infamous “stuff happens” remark during the looting of Baghdad, McChrystal backed him up. A few days later, he echoed the president’s Mission Accomplished gaffe by insisting that major combat operations in Iraq were over. But it was during his next stint – overseeing the military’s most elite units, including the Rangers, Navy Seals and Delta Force – that McChrystal took part in a cover-up that would have destroyed the career of a lesser man. 

After Cpl. Pat Tillman, the former-NFL-star-turned-Ranger, was accidentally killed by his own troops in Afghanistan in April 2004, McChrystal took an active role in creating the impression that Tillman had died at the hands of Taliban fighters. He signed off on a falsified recommendation for a Silver Star that suggested Tillman had been killed by enemy fire. (McChrystal would later claim he didn’t read the recommendation closely enough – a strange excuse for a commander known for his laserlike attention to minute details.) A week later, McChrystal sent a memo up the chain of command, specifically warning that President Bush should avoid mentioning the cause of Tillman’s death. “If the circumstances of Corporal Tillman’s death become public,” he wrote, it could cause “public embarrassment” for the president.

Superstars create numerous challenges. First, they often believe they’re part of an elite group, which makes it difficult to hold them accountable. And its this status they believe provides them priveleges and unlimited “get out of jail” cards when a problem emerges. Second, they can hold the team and the organization hostage. At times, they view themselves as “untouchable.” Third and possibly most important, they can be very difficult to get rid of, because they have the connections and the knowledge that could put your organization in harms way.

So what are the lessons we should heed?

  1. Be careful when putting superstars in leadership positions. Do your homework up front.
  2. Realize no one is irreplaceable. Be prepared to cut the line sooner, rather than later.
  3. Remember, toxic superstars add to your bottom-line, but also take away from it through higher turnover and diminished performance.

At the end of the day, every organization is in search of superstars. However at the beginning of the day, make certain they’re the right fit.

Oren Harari - A Tribute

Wednesday, April 21st, 2010

I was introduced to Oren Harari about 5-years ago at a Vistage Conference being held in DC. Oren was the keynote speaker for a noon luncheon, and one I remember to this day. Oren being about 6′ 5″ or so and a mere 170 lb. or so was dynamic and energetic. I remember Oren pacing back and forth across the stage telling one story after the next - it was memorable.

Since that day, I’ve followed Oren on his blog and read a couple of his books. He was a great thinker! A couple days ago I learned that Oren died. I’m sad, we lost a great thinker that had more to give. However, I’m not going to write about Oren’s accomplishments, but rather, his next to last blog. You see, thought leaders are always studying and thinking about the system, even when they’re part of the system. On December 17th, Oren wrote his next to last blog on his site, it was titled, What Cancer Survivors Can Teach Entrepreneurs. I thought at the time, this is a unique perspective about the great game of business. What I didn’t realize at the time was that Oren was a patient in the system. He was writing not as a researcher, but rather a patient. It appears he was destined to not allow a bad situation emerge without a few good learnings. Here are few take aways from that blog entry.

Glioblastoma multiforme (GBM). GBM is the most common and aggressive type of primary brain tumor in humans… Make no mistake, GBM is a virulent killer. The statistics are pretty horrific. Only 10% of people who get diagnosed with it even survive until the second year, and only 1% survive 5 years.

And yet….And yet…. There is still cheer for this holiday season. There are lots of individuals with GBM who not only survive, but they go on to lead long, healthy, happy productive lives. What’s their secret? And how does that secret help an entrepreneur or leader of a start-up business?

Well, I did a little bit of investigation on this subject and came up with an interesting conclusion that may surprise you. It did me.
What the GBM survivors do is seemingly ignore the devastating aggregate data on the disease that’ is available throughout the Web. They’re not ignorant of the disease they have: of course,they research it. They know what they are up against, but they concentrate daily only on the specific data they need to succeed in their own unique personal journey.

Okay, so back to the title of this blog—what does all this have to do with entrepreneurialism?

Quite a bit, actually.

My research over the past couple decades has demonstrated that many successful entrepreneurs would never have launched their businesses in the first place (nor worked at a frenetic daily 24/7 pace) if they had dwelled on the overwhelming challenges facing them in the marketplace, or even within their own organizations.. That is one reason that entrepreneurs are slightly insane to begin with.

Optimism on its own can be catastrophic: witness the irrational rise and inevitable blow-ups of the Internet and housing bubbles over the past decade. No, what I am talking about is more than optimism. It is unyielding focus, concentration, determination, a vision of clear goals, and plain unyielding persistence, , one day at a time, regardless of the external views that you are a damn fool for venturing into the shark-infested waters in the first place. Optimism is the consequence of this process, not the instigator.

 By definition entrepreneurs are separated from the traits and behaviors that proliferate among those in the “normal” population. Let’s remember: Deviant monomania in goals and in executions is what drives significant improvements in medicine, business and national economies.

Suggestion: put a cancer survivor on your board of directors.

When I read this post from Oren, it gives me goose bumps. And never once in his post does he give us the insight or inclination that he is a part of the system. And despite the situation, Oren had a lesson to teach. Life is short, so never overlook a teachable moment. It may be your last and most memorable lesson.

Thank you Oren, I will miss you.

Second Chance Points

Wednesday, April 7th, 2010

I’ve been intrigued with the David vs. Goliath story that unfolded over the past month, aka Butler vs. Duke in the NCAA Basketball Tournament. It’s been a story few could have imagined, and am certain will be a movie in the future. It rates right up there with Herb Brooks and the 1980 Olympics, where the US Men’s hockey team upset the highly favored Russian team, and eventually took Gold. Despite the phenomenal storyline, there is an integral business and leadership lesson that lies in each of these stories. This being “Second Chance Points.”

CBS analyst and commentator Clark Kellogg in his coverage of the Road to March Madness introduced me to the importance of Second Chance Points and Points off Turnovers (Part 2). In basketball, second chance points occur when there is a missed shot and the  team on offense gets the rebound or recovers the ball following a missed shot and scores. If a team is aggressive, smart and talented, they get more second chance opportunities and second chance points than the opposition.  How does this relate to business success or leadership?

Nobody bats a thousand every day. And from time-to-time, even the most disciplined businesses and leaders mess up. An order was incorrectly shipped. A client sales call didn’t go smoothly. A deadline was missed. A product recall is initiated. An employee didn’t follow through on a commitment they made. If you’re a competitor, you realize the potential for picking up new business increases exponentially when the competition messes up. However, on occassion good companies get a second chance - great companies almost always get a second chance. They get a second chance because they have developed a deep relationship with their customers. In essence, the company’s value proposition is always greater than the product or service they sell. And because the value proposition is high, they are given a second chance. And if they leverage their second chance opportunity, they’re even able to score points off of the initial miss. Think of these contrasting companies and second chance points. Which companies have been able to leverage second chance opportunities?

Southwest Airlines vs. Delta, American or Spirit Airlines
Apple vs. Microsoft
Google vs. AOL or Yahoo
Netflix vs. BlockBuster

I’d suggest that Southwest, Apple, Google and Netflix are positioned to leverage Second Chance Points. Because when you’re given a second chance, you have the luxury of being able to learn from your mistakes. When you aren’t offered a second chance, you die by your mistakes. This is why companies must fight their way to earn the right to be given a second chance.

So what do organizations need to do to position themselves for Second Chance Opportunities and Second Chance Points?

  1. Build deep relationships with customers, employees, and suppliers.
  2. Remain true to the Vision and Values of the organization.
  3. Acknowledge missed opportunities, fix them and learn from them.
  4. Celebrate Second Chance Points when they occur.
  5. Never take for granted that you will be offered a second chance.

Second Chance Points are huge strategic advantage when you’ve earned them, because it makes it more difficult for competitors to displace you. In the next blog, we will discuss turnovers and points off turnovers - stay tuned.

What We Can Learn From March MADNESS

Monday, March 29th, 2010

Two weeks ago, the NCAA selected the top college basketball teams across the country by offering them an invite to March Madness. Four regions with 16 teams each. Each region would have a Number 1 seed. Kansas, Syracuse, Duke and Kentuckywere given the Number 1 seeds. And within days following the selection, the madness began. In fact one report circulated that the number of scheduled vasectomies increases by 50 percent the day before the first tip-off of March Madness. It appears the recovery time from this procedure is two days, which means two days to watch basketball non-stop with a doctor’s order to do nothing but rest and relaxation. For some, this is evidently a win-win scenario.

Despite the rampant enthusiasm that can surround March MADNESS, several leadership lessons are noteworthy. Some of these being:

1. Winning Teams Get Better: Winning teams figure out how to be at the top of their game. This is accomplished through conditioning, coaching and creating that “can do” confidence.
2. The Best Team Doesn’t Necessarily Win: This year’s tournament has been filled with unexpectant upsets. In fact only one #1 seeded team advanced to the Final Four, this being Duke. In business and basketball, major upsets occur everyday.
3. Competitive Advantage: Basketball coaches and business leaders must identify their competitive advantage and then figure out how to leverage it in the marketplace. This is achieved by understanding the market, asking lots of questions, and then leveraging your advantage(s) to achieve success.
4. Leverage Talent: Winners simply figure out how to leverage talent, and then figure out how to utilize it to their advantage.
5. Respect the Opponent: Upsets occur everyday in basketball and business. Teams win because they want to win, not because they deserve to win.
6. Good at the Little Things: Great teams spend a lot of time on doing the basics really well. And when you look at how teams lose, it can often be tied back to how they fail at the little things.
7. Momentum: Momentum is often overlooked, however its importance is paramount. Winning teams know how to build momentum over a season, and how to leverage it second-by-second in a game. In the game of business, momentum is integral to success.
8. Communication: Winning teams know how to communicate really well. They listen. They watch. They move to the open spot on the floor.

March is a special time of the year, especially for basketball fans. For many players, its the end of the season and the end of their careers as basketball players. However, the lessons learned on the court can be directly transferred to life and to business. Unfortunately, too many athletes forget these important lessons. At the end of the day it boils down to talent, leadership and team, and this is what makes basketball, business and March Madness special.

Wondering Around

Saturday, March 20th, 2010

Is there such a thing as “The Art of Wondering?” I think there is, although most of us have probably lost our zeal to pursue it. In fact “Wondering” is at the heart of innovation, discovery and enlightenment. Wondering Around is a simple idea from Seth Godin, and it was a mistake. Here is his blog post on Wondering Around.

I stumbled on a great typo last night. “Staff in the lobby were wondering around…”

Wandering around is an aimless waste of time.

Wondering around, though, that sounds useful.

Wondering why this product is the way it is, wondering how you can make the lobby more welcoming, wondering if your best customers are happily sharing your ideas with others… So many things worth wondering about, so few people actually taking the time to do it.

Wondering around is the act of inquiring with generous spirit.

I believe that Seth Godin has stumbled upon a B-I-G idea that can make a difference. I can honestly state that I’m a Wondering kind of individual, and it was a foundational component of my book, Without Warning. The amazing thing about Wondering is it takes virtually no effort and it can be truly delightful and enlightening.

I encourage you to pursue your day with a bit of Wondering Around.

The Uncover Boss - A New Job Requirement?

Monday, March 15th, 2010

Is reality TV finally living up to its name? Most of what we are served up under that rubric is actually the farthest thing from reality. The exploits of Snooki, Jake the Bachelor, and all those Real Housewives hardly reflect life as most of America knows it and lives it… Enter “Undercover Boss,” the new CBS reality show in which corporate CEOs don disguises and spend a few days experiencing what it’s like to be a low-level worker at their companies. Arrianna Huffington

Procter & Gamble Co.’s Bob McDonald is going undercover in Latin America next week. Posing as a market researcher, the chief executive officer will accompany shoppers to stores or make home visits. The trip, to Brazil, Mexico and Argentina, will be his 59th since taking charge in July and is central to his plan to reach 1 billion new customers by 2015. (P&G’s McDonald Pins Growth on Closer Shave Than Mumbai Barber by  Mark Clothier)

Leaders understand that what happens and what is known, can be odd bedfellows. For some leaders, its the ultimate defense for the leadership gaffs we’ve experienced in recent years. Companies like Toyota, GM, the SEC (The Securities & Exchange Commission) and others come to mind. Just having at one’s disposal a, “I didn’t know that…” can be sacred shelter to the psychic of a weak leader.

However for most leaders, the “I didn’t know…” is cheap rhetoric and a feeble excuse. They actually want to know and understand what is really going on, how people really feel about their jobs and the company’s products, and what lurks silently in the corners. For they know that to lead, they also need to know what is really going on. They actually fear the silent problems they may not yet know or be aware of. How can they achieve this? Here are a few suggestions I make in my Silent Problem presentation.

  1. Be an outstanding listener. And the best way to becoming an outstanding listener is to be excellent at asking insightful questions.
  2. Shadow: Become the undercover boss that sees the business from the eyes of the employee or the user of your products & services.
  3. Conduct regular One-to-Ones: Don’t ask for fancy powerpoints. Simply ask, “Tell me what is going on.”
  4. Create a culture of candor: The door into your office needs to be every bit as large for bad news, as it is for good news.
  5. Management by Walking Around: It is highly effective and well worth the effort and time. Check out this link, Doing the Walk Around
  6. Be constantly searching for silent problems and be diligent in solving them (more on this in the book Without Warning).

CBS’s show Undercover Boss is simply another variation of reality TV that is trying to expose a unique angle on life. Is it cheesy? Yes. However, it does expose the gap between what can happen in the organization and what the leader knows come to life. And there is a lesson in this. Part of being an effective leader is being an Undercover Boss.

Toyota’s Who Is No. 1 Challenge

Friday, January 29th, 2010

Everyone knows the challenge Toyota Motor Company is facing with sticky gas pedals. We know that Toyota and its dealers have suspended manufacturing and sales of the affected models. We know that millions of current owners are greatly concerned about the cars they drive to work or use to transport their family. We know that a design fix has been made by Toyota’s supplier CTS, and it is shipping. We don’t know who will receive the limited resource (the new pedal design) first.

So here is Toyota’s Who Is No. 1 Challenge.

The Factory Scenario: If the factory receives the parts first, production facilities can be restarted, 1000s of employees will move back to a normal work schedule, and new cars can be shipped to dealers and ultimately purchased by consumers.

The Dealer Scenario: If the dealers start to receive the updated pedal assemblies first, they can begin installing them on cars in their lots, which will enable new car sales to resume. In turn, plants will remain idol and cars currently in use will remain at risk.

The Customer Scenario: If the customer is the top priority, new pedal assemblies will be shipped to dealers and cars with defective pedals that are currently in use can be repaired, thereby satisfying the needs of the existent customer. In this scenario, plants remain idle, and new cars on dealer lots aren’t available for sell.

The Modification: Toyota and its supplier CTS is talking about providing a modifaction kit for cars currently in use. This would allow updated pedal assemblies to be used by the factory and dealer installs on new cars currently sitting on dealer lots. Will customers be truly satisfied with a so-called fix?

Which scenario will Toyota pursue? Which scenario should Toyota pursue?

It’s a tricky question, because it gets to the crux of “Who is No. 1.” If Corporate Profits are Number 1, factories will receive the assemblies and a few might leak through to the dealers. If the Dealer is No. 1, dealers can begin moving stagnant inventory and keep their sales staff productive. If the Customer is No. 1, consumers will feel valued and might be forgiving.

Now let’s take one additional piece of information into consideration, this being Toyota’s Mission and Values Statements.

Mission Statement

“To attract and attain customers with high-valued products and services and the most satisfying ownership experience in America.”

Vision Statement

“To be the most successful and respected car company in America.”

 

With everything now on the line. Which next step should Toyota pursue? I believe their next step will truly determine whether or not they live their Mission and Vision Statements.  I believe it will define Toyota’s future success, or decline. Unfortunately, it could have all be avoided.

What do you think? Which demand point should recieve the new pedal assemblies?

Trust - Dented, Lost & Important to Restore

Tuesday, January 26th, 2010

Davos is a BIG Thing. At least to those who are invited to attend. Mukity mucks with big titles and possibly BIG egos are in attendance. It is the social event of the year, where appearance does matter. It is the American Idol of the business and financial community. With all that said, I’m surprised I have yet to be invited - maybe next year.

Today an article appeared in the The Wall Street Journal, it is titled, “DAVOS: Critical To Rebuild Trust In Institutions - WEF .” The article starts by stating:

Rebuilding trust in financial institutions is critically important for the whole financial system and for restoring institutions’ competitive advantage, according to a World Economic Forum report Tuesday.

The report, released on the eve of the World Economic Forum annual meeting, said the financial crisis severely dented trust in banks and other institutions and would take some time to restore.

The general public has lost trust in financial institutions’ leadership, calling not just for resignations but sometimes for criminal prosecution and more often increased oversight of incentive structures,” the report says.

Financial institutions may find it difficult prioritizing actions to restore trust, against competing pressures from regulators, shareholders and customers, the report concedes.

But it says restoring that trust would help institutions get back on the track to competitive success.

Wow, in a 255 word article, Trust is mentioned 7-times. References included restore trust, dented trust, lost trust, issue of trust and trust meltdown. Upon reading this article, I now have a better idea who not to trust. First, I probably shouldn’t trust those in attendance at Davos (I guess I should be glad I didn’t receive an invitation - it wouldn’t have looked good on my resume. It sounds to me like they have some “issues relating to Trust.”)  Second, I guess I shouldn’t trust those that I have trusted for a lifetime, that being financial institutions and bankers. And most definitely, I probably shouldn’t trust banking leaders - you know those that are receiving BIG bonuses for their hard work.

As we delve deeper into 2010, the phrase “who can we trust” will gain in importance. Every business will ask this question of their suppliers, their customers, their advisors, and most definitely, their financial institutions. Trust is a cornerstone of commerce and community. It is critically important that trust be elevated in 2010, because the World demands and expects it.

So who do you trust today?

Your Toughest Race

Tuesday, December 29th, 2009

Here is an article I published over on FindYourNerve.com in mid-November. With the quickly changing economic outlook, I thought the message is especially pertinent as we head into 2010. Enjoy!

I frequently cut out newspaper and magazine articles that possess a unique perspective on life or business.  Several years ago, newspaper reporter Bruce Brothers of the St Paul Pioneer Press interviewed a gritty Minnesota runner named Luther Thompson.  Thompson, in his late 50s at the time, had been known to enter some of the most grueling running races in the world, including the Leadville 100, a hundred mile race across the Rocky Mountains in Colorado.  When Brothers asked Thompson what his toughest race was, a totally unexpected answer emerged.  Thompson simply replied, “The toughest race is always the race I’m doing, whether it’s a 5K or a marathon or an ultramarathon.” 

 When I read that statement, I was awestruck by its simplicity and wisdom. Thompson was right, even as business leaders, our toughest race tends to be the race we’re running. This might be tackling a problem or pursuing an opportunity that is facing us. And it’s how we work through these issues that will determine how we place in the race we refer to as, business.

 Twelve months ago, the toughest race for most businesses related to how to quickly transition away from growth, due to a sharp downturn in economic activity. Decisions had to be made to align with the new reality we call recession. Each decision held consequences and opportunities. Each positioned the business for success or failure.

 Today, a similar toughest race scenario is beginning to emerge. Suddenly, organizations in survival mode are being challenged with another transition. This transition is about how to grow once again. And this is the take home point. I believe the toughest race for business leaders is to understand how to best lead through transitions. To lead through transitions effectively, one should consider: 

  1. Understand where you’ve been, and recognize where you’re going.
  2. Leverage talent, and keep them engaged and motivated.
  3. Lead from a position of transparency and honesty.
  4. Delve into the tough “what if” issues by asking the hard-hitting questions.
  5. Communicate. Communicate. Communicate.

 In this latest transition, leaders can’t afford to lose their nerve in moving forward. It’s our responsibility to demystify the unknown, create clarity around what’s really important and possess the confidence on how best to move forward. Only then can the toughest race become manageable and won.

 Yes, the toughest race is always the race you’re doing.  Whatever you do, don’t lose your nerve at the starting line, the place where races are won and lost.

Number 1 is the Loneliest

Monday, December 21st, 2009

Most organizations strive to be No. 1. It is the coveted spot. The position where success is realized. The position where trophies for excellence are offered. The position where power is garnered. However, it is also a very lonely and dangerous position to reside, because being No. 1 often breeds complacency and risky behavior.

A case in point is Toyota, a firm I’ve written about several times. Last weeks Economist, the front cover title was, Toyota slips up - Where the world’s biggest carmaker went wrong, and what it is learning from other corporate turnarounds.”

The article points out numerous areas where Toyota has become vulnerable while being in the No. 1 slot. 

  • Quality: “Toyota was a byword for quality and reliability. A few years ago its crown slipped when a number of qulity problems surfaced… For years Toyota has been the quality benchmark for every carmaker, but at the very moment it faltered, others were finally catching up”
  • Style: “As Car Magazine observed recently: ‘Excepting the small cars and the Prius, Toyota’s European range is as appetizing as an all you can eat tofu buffet.”
  • Safety: “Last month Toyota’s standing was dealt a further blow. The Insurance Institute for Highway Safety… announced its highest rated cars and SUVs for 2010… Not one of the 27 vehicles it chose was a Toyota.”
  • Silent Problems: “In another class action suit, triggered by a former employee, a corporate lawyer named Dimitrios Biller. Toyota is accused of trying to cover up evidence that it knew some of its vehicles could be deadly in roll-over accidents… The suggestion that squeaky-clean Toyota’s behavior may have resembled that of Ford and GM, which in the distant past covered up problems with the Pinto and Corvair, is especially wounding.”
  • The Test: The test will be to keep the ingredients that have made Toyota great - the dependability and affordability - while adding the spice and the flavours that customers now demand. It will not be easy, and the competition has never looked more formidable. But by recognising the scale of Toyota’s problems, by proclaiming their urgency and then drawing on the firm’s strengths to fix them, Mr. Toyoda has already taken the first, vitally important step towards salvation.

Over the past 18 months, numerous companies that once held the coveted No. 1 slot have fallen. Consider the likes of CitiGroup, GM, Circuit City, Lehman Brothers and Washington Mutal. And of course, we can’t for forget Tiger Woods, and his fall from high. Each were at the top of the their game - then something happened. Simply, they lost their competitive edge, partly by being Number 1.

Today, Toyota is in a dangerous position. It has lost momentum. It’s reputation has been tarnished. And, many of its customers are finding attractive alternatives. Yes, Number 1 is a dangerous and lonely position from which to lead.

Be the one to see it coming!

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Without Warning - Rondey Johnson

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