Tag Archives: Leadership

Can Generalists Thrive in the Conceptual Age?

One of the questions I get most often is: “what do you do?” The answer to that question is not an easy one, as my work with companies ranges from start-ups to those almost middle market size, and the services I offer from advisory board member to turnaround artist. Yet, when my role is marketing consultant, I advise others to be able to answer the very same question crisply, concisely, and in a compelling way. What is poignant is that, as we gain more skills over the years, it becomes harder and harder to specialize. That is not to say, however, that I have not met people in business who are extremely specialized and who succeed in their field. For the moment, though, I want to write for others who have adapted to competitive market demands to embrace new skill sets, become masterful enough that others hire them to provide those new skills, and now are the proverbial “generalists.”

Don’t confuse “generalist” with “General,” however, as many generalists struggle to stay with one organization long enough to rise to the rank of top officer. Furthermore, a generalist has challenges in the unique realm of trying to keep up with evolution in many more topical areas, all of which are changing at a faster rate than at perhaps any time in history. The good news is that, as Daniel Pink points out in A Whole New Mind, we are now living in the Conceptual Age, having evolved from the Information Age to a day and time when creativity will be valued highly. Maybe that is not such good news for left brain folks who are not able to adapt, but for those (for whom the learning of new information was merely a means to an end, the end being to connect emotionally with others, build relationships, and find success while doing so) who embrace right-brained living, it is a brand new day!

Here are the new skills that are needed in the Conceptual Age:

  1. Design – the ability to create something that has significance as well as usefulness.
  2. Story – the ability to put facts into context and deliver them with emotional impact.
  3. Symphony – the ability to see the big picture, connect the dots, combine disparate things into something new.
  4. Play – sense of humor and laughter plus other components to balance the psyche.
  5. Empathy – standing in someone else’s shoes, feeling with his or her heart, seeing with his or her eyes.
  6. Meaning – working for something in which one believes with others who have similar values.

As you can see from the list, the emphasis and value will be placed on original thought rather than automatable routines. Computer power has now rendered many repeatable acts less valuable (not unnecessary, mind you, just worth less than previously because either low wage earners or machines can perform them admirably). What will come to be increasingly important is the ability to think up a new concept, develop it sufficiently, and share it so that it resonates with the heart of another. 

What’s the role of the generalist in this new economy? That depends–can you adapt, or are you trying to pour new wine into an old wineskin? Those of us who can adapt will be able to answer questions like “what do you do?” with less of an elevator pitch and more of a carefully crafted story that captures the mind, will, and emotions of the intended audience, hopefully in a multi-sensory way!

Cheers to you as you embark on the journey to greater relevance, enhanced value to others, and — I sincerely hope — a much greater sense of doing something truly meaningful (other than just adding to your repository of information.)

 

Owner as Entrepreneur vs Manager: Jekyll and Hyde

At the center of every small business management team is the owner, whose primary long-term responsibility is to manage the company effectively. While some companies have several people who function in this capacity, this discussion will assume that an on-site entrepreneur/owner runs the business. Traditionally, this individual oversees the entire operation and personally looks over most company work, both in the office and in the field/plant. Furthermore, the owner is commonly a jack-of-all-trades, wearing the hats of many different employee roles.

The “Jekyll & Hyde” Theory

It is often asserted that the individual who single-handedly runs a company has a certain, identifiable “Jekyll and Hyde” personality. In demeanor and approach to problem-solving, the typical owner ranges from brilliant to tyrannical. An effective strategic plan must therefor encourage brilliance while keeping the owner away from problems that transform him or her into an ineffective manager. The same qualities that have enabled the owner to gain insight into many facets of the business operations are the exact ones that force him or her to be involved in every decision, major or minor. Such overt  care and concern for the company is to be anticipated and applauded. When it results in ineffective management, however, a remedy must be devised.

Entrepreneur or Manager?

Efficient businesses require in-house management. Unfortunately, the skills that make an owner a successful entrepreneur can be at odds with those that make one an effective manager. Excellent entrepreneurs have great sensitivity to market changes. However, when they leave the daily operations to become managers, two things happen: 1) they stop using their innate skills, and 2) they manage ineffectively.

Though the owner may experience periods of fear or apprehension, as a group owners are generally optimistic and opportunistic. Good owners emanate confidence, motivating those around them. For example, by spotting a mismatch between market demand and supply, a good one can inspire employees to work towards meeting that demand. Uniquely able among executive team members  to downplay the importance of minor setbacks, savvy owners emphasize the company’s forward movement in a vision casting mode.

Finally, first-hand knowledge of company history sets the owner apart. Having founded the company, the owner as entrepreneur is an indispensable part of the management team. When questions arise concerning company history or past performance, as they frequently do during times of tension, who better to turn to than the individual who has owned or managed the company all the while?

The Owner’s Vision

In providing vision for the company, the owner is expected to identify opportunities to pioneer new markets and expand the company’s presence in existing markets. Thorough identification of precise product offerings and internal procedures to make the products is a large part of every owner’s job description. The interaction between market research (including trends, buying patterns, and demand) and company vision is a relationship that the effective entrepreneur manages on a regular basis.

The entrepreneur can help the management team by maintaining personal relationships  with key parties such as sales people and lenders. If links have been formed based on good rapport with these parties, it is only fitting that these relationships continue  when they cannot be successfully turned over to another manager. This scenario rings particularly true with regard to negotiations with suppliers. The owner’s involvement in handling these parties is essential to reinforcing profitability.

 

Qualifications of a Turnaround Adviser

An effective turnaround adviser must be uniquely qualified to deal with crises and prepared to assume responsibility for the company’s success. The three most important background credentials for an adviser are as follows:

  • an identification with the needs of declining companies
  • specific industry expertise in your industry or a related one, and
  • a track record of overcoming adversity and making the most of poor situations

General Requirements

When evaluating possible advisers, teams should look for someone with both practical, hands-on capabilities and an educational or research-based knowledge of the issues at hand. Make sure you do not have a novice attempting on-the-job training at your expense. It would be wise to find someone who has performed at least a dozen turnarounds individually and who has access to other personnel with the same or greater levels of experience. Furthermore, familiarity with research and educational publications within your industry that highlight concepts of turnaround practice gives an adviser a more objective view of workable solutions to difficult problems.

Industry Expertise

A background in your industry prepares an adviser to face the peculiar, industry-specific dilemmas that invariably arise. Previous work with companies of various sizes and in various markets furnishes the adviser with extensive–and beneficial–exposure to your industry. A proven ability to learn new markets overnight and employ existing operating resources effectively will result in quicker turnarounds. Examine the methods the adviser used with prior clients and determine whether similar programs would make a comfortable fit for your business. “Sanitized” copies of turnaround plans produced for other clients may even be requested.

Success Rate

A turnaround adviser’s success rate with previous clients is an important statistic. Much as a baseball team manager would hesitate to hire a pinch hitter who batted below .200, the executive team must exercise caution in selecting someone to captain the turnaround team. Most advisers who have been in business for more than five years can claim a one out of two (50 percent) or greater rate of success. To reduce risk, the team should look for an adviser who can claim–and substantiate–an 80 percent or better success rate. Once a successful adviser has been located, the team shout contact references and ask what made the effort a success.

Crisis Management

Effective turnaround advisers must possess certain qualities and characteristics that uniquely prepare them to deal with crises. The first such quality is “multilevel simultaneous thinking”–the ability to solve problems on several different levels at the same time. This is a skill gained over time through both education and experience. The ability to interact with numerous employees to resolve multiple dilemmas and relate to each in an appropriate manner is also essential.

Negotiating with Opponents

A turnaround adviser’s ability to search for all the important details, address issues with a penchant for opportunism, and follow through on commitments will also further the turnaround process. Note that “opponents” emerge in turnarounds virtually overnight; they tend to be former allies such as lenders and vendors. Being able to decipher an opponent’s true bottom line and make an offer that more than covers his or her threshold yet preserves the company’s position will save the company precious time during the turnaround. Indeed, many of these opponents in negotiations will return once again as allies when the business emerges from its decline. In completing a cycle of commitments to stakeholders, the turnaround adviser should ensure that every promise made can be carried out to the letter. Such consistency in following through on promises will enhance the builder’s credibility and image in the community.

Often employing little more than intuition, a crisis-oriented adviser can anticipate pitfalls and plan around them before trouble occurs. Being able to foresee a turn of events is a rare quality to begin with, but is especially valuable when coupled with the creativity that allows the adviser to adapt the flexible strategic plan to the changing demands of the situation. This ability to adapt to change is a necessary elastic band in the adviser’s armor, without which all other tactical weapons would be useless.

 

Management Direction and the Turnaround

With the necessary financial and operational restructuring, plus the marketing re-positioning, it is easy to overlook a key factor that often proves to be critical to successful turnarounds: staff motivation. Reorganizing and involving not just the management team, but also the rank-and-file  are two essential tasks. The entire company must be pulling in the same direction to achieve optimal success. Involvement creates a “can-do” atmosphere that spreads to vendors, customers, and other stakeholders.

Involving Staff

It is imperative that appropriate changes be made to show that the executive team is committed to “doing whatever it takes.” Key employees should be encouraged to take an active role in the turnaround process, ensuring that they feel they are a vital part of the solution. Regularly scheduled management meetings are the new norm. In times of crisis, these meetings may need to occur daily; in profitable times biweekly should be adequate. Finding yourself and the team somewhere between crisis and optimization may be reason to vary the frequency of meetings, but they should never be more sporadic than once every two weeks.

Motivation

Do not be afraid to ask employees their opinions about what motivates them to perform. These opinions can be used to develop performance measurements and incentive plans. Scrutiny of company policy manuals and benefits offered can help identify ways to enhance engagement. Also, discovering the most frequently encountered problems can reveal how managers are applying–or failing to apply–useful solutions. Project descriptions, summaries of the company’s performance in adhering to budget and time constraints, and brainstorming time to recommend better methods are good synergy building activities.

Evaluation

Some companies like to administer tests of ability to prospective employees. Yet, once the prospects are hired, there is very little training and development. Close supervision should yield observations about areas for improvement. It is the responsibility of management to find ways to challenge employees to grow in their capabilities–both technical and soft skills–throughout their careers. Developing professional growth plans and holding folks accountable to execute them is good for all. Tying performance measurement to the plans shows employees that you are serious about continuous improvement and results-based management.

Teamwork

The team is also responsible for cultivating the management team concept in hiring employees, meeting goals and objectives, and conducting individual performance reviews. In addition, management’s performance should be reviewed to locate and remove any team members who are preventing goals and objectives from being met.

Hiring people who complement one another is the first step in forming a cohesive management team. Effective hiring is accomplished through a careful planning and implementation process that parallels the general turnaround effort. Write down job requirements before the hiring process begins. Solicit qualified candidates; throw out applications/resumes that are out of scope. Referrals from suppliers and customers tend to be the best sources of candidates. Objective measurement of qualifications against standards you have developed will shorten the list to be interviewed. Personal references and one-on-one assessments with the prospect’s proposed work team will verify compatibility.

Employee participation in the decision-making process is needed–more so during a turnaround. While key employees should be encouraged to contribute actively during meetings, they may not be asked to vote on issues affecting them directly. Meetings should also be an opportunity to thank employees for a job well done. Rewarding a manager for adherence to budget and schedule without also recognizing her team detracts from the team concept.

Reorganizing Staff

Reassigning personnel and restructuring responsibilities demands management team decision-making. Decisions about incentive and performance programs require outside assistance in so far as tax and legal consequences are concerned, but the ideas and proposals should come from management team meetings.

Management should not exclude themselves from the reassignment process! It may be that the president, for instance, is most valuable to the company in a different capacity or focus area. Like all staff members, she should be prepared (especially during a turnaround) to work in a role where strengths can be put to maximum use!

 

Turning Around a Company Not in Trouble

Someone once asked John Whitney of Columbia Business School the question, “how do you turn around a company that isn’t in trouble?” John’s reply was classic–

“it is in trouble—it just isn’t in crisis yet. The idea is to avoid a crisis by changing the policies and procedures in the company so it can really compete globally, compete for the long term.”

John went on to say that waiting until a company is in trouble to fix it is management by exception. Over 20 years ago (before globalization and a worldwide economy became the hot topic it is today) Mr. Whitney observed that competition abroad to continuously improve would force companies domestically to keep focused on “management by review.“

Companies that have enjoyed success, however, can be reluctant to undertake change through what is termed an operational turnaround. It can be harder, though, without the threat of imminent insolvency, to change company culture and rituals. This type of management change relies far less on historical financial performance than on looking forward to what might be.

How to Know When You Need It

Sometimes, losing a big customer is the trigger point. But, losing one can be explained away. Losing multiple large customers and key employees should definitely raise your antennae. If you begin to take longer to take products to market and the competition keeps introducing new products faster, these patterns should make you consider getting outside help. Look to your customers and suppliers to provide industry feedback and “intel” on trends and patterns. 

While Others Cut Costs, Innovate

Suppliers know what’s happening and can advise how to improve your product. Eliminate layers in your company. Get back to communication in person. Lost time, will and energy to problem solve creatively is the biggest expense in most businesses. Regain respect for the people doing the work—respect their integrity, intelligence and commitment. Eschew over-control. Break down communication issues between departments. Cross-functional management focuses on running a system, each part dependent on  the other.    

John Whitney said that, when he watched Leonard Bernstein conducting Beethoven’s Ninth Symphony, he realized that Bernstein “did many of the same things a good manager does. There were parts of the score where he was deeply involved, working to make sure he got exactly the sound, the nuance he wanted. And he knew what he wanted. But he also knew when the orchestra had it going right, and he wasn’t afraid to lean back and just let it happen, let the musicians do their jobs and listen to the music all come together.”

How about you–are you willing to take a hard look at your organization and determine to become better, even though you are already good? Ever heard the expression, “good is the enemy of great?” Consider ways that you can improve information flow, creativity, problem solving and other soft skills. In addressing these seemingly minor issues while business is good, you prepare the way for an operational turnaround–innovation as some may call it in today’s vernacular!