Passages - Richard Reardon

NOTE: This blog was initially published in 2014 as part of a series I wrote about the most unforgettable people I have known in my life. I learned this morning that Richard passed away in September of this year after a battle with cancer. I knew Richard, and he served as a life-altering thinking partner to not only me but to many others that he worked with as well. I have never met anyone else that is as skilled as a critical thinker as he was. He will be much missed by all those who knew him. As always, you can find all of my blogs from 2013 to the present on my website at https://stevemarshallassociates.com/steves-blog/

I met Richard Reardon in 2011, when my colleague, Chris Hutchinson, suggested that I should chat with him to see where my professional gaps were, even with all of my unusual and extensive work, as well as, my life experiences.

Our first call was utterly bewildering as he started to ask me questions about various subjects related to how I conducted my consulting practice and how I interacted with clients. I got a little defensive and suggested that after 25 years of consulting work, I thought I knew what I was doing. Well, guess what; I really didn't know all that I thought I did or needed to know.

So began an over 2-year weekly journey with Richard to explore how I could always be better at serving clients in a way that would allow for transference of skills vs. me always being the expert that had all of the answers. What's more, how to provide real and measurable value.

The first three months were the hardest learning experience I have ever had, with me hanging up the phone at the end of each call feeling more and more stupid and frustrated than the previous call. I even considered calling it off, but I was also intrigued that this old dog (yours truly) might be able to learn some new tricks!

What I learned from Richard could fill a few volumes, but here are some jewels that I can share with you now:

  1. Know the difference between "why, what," and "how" - too many people in the world of work often skip right over the "why"and the "what" and start figuring out "how" to get something done before they even decide why and what it is that they are doing. In the world of American business, this is almost an epidemic. I see many so-called strategic plans that people have paid a lot of money to a consultant to execute that are actually just operational plans. I would summarize this lesson into five words - achieving clarity about what's important.
  2.  Don't take on other people's limitations as you decide how you are going to negotiate with, interact with, and work with them. Too often, potential clients, as well as current clients will "project" their fears and limitations onto you, when they really don't know what it is that they are thinking about. Helping them to decide what is really critical and what they would like to achieve will serve both parties well, as you continue to build a relationship between you and them. I would summarize this lesson into two words - getting focus.
  3.  Most of all, I learned from Richard that the present world of work is too complex to go it alone and we can all benefit from having someone to be an objective thinking partner, sounding board, and even just a person to vent frustrations with that can respond in a non-judgmental way and defuse possible inappropriate actions. I would summarize this lesson into six words - no one can be an island!

How does some of this translate into my daily work life? Well, for one, before I go into any meeting, whether it be with a current client or someone I am meeting for the first time, I ask myself, out loud, "What do I want to accomplish here?" Then, I do the same at the beginning of the meeting; setting, by agreement with the other party, a time limit and what we would like to accomplish, the ways that the meeting could end and then any possible future connections we could make. 

Here is the best part about Richard; he was so good at what he did that I never even met him - he lived in L.A. and I was in Colorado - we spent a few hundred hours on the phone between 2011 and 2103 and the only way I know what he looks like is through his LinkedIn photo. That's how good he was at what he did.

We'll all miss you, Richard.

Letter to a Young Friend Seeking Advice

NOTE: J.R.R. Tolkien has been paraphrased by many when he wrote the following; "All that glitters is not gold" in his groundbreaking trilogy, 'The Lord of the Rings.' I took that theme and wrote this letter to a young person that asked for my advice about decisions regarding their future. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/.

Time Out!

I have taken two life breaks (so far) in my short sixty-five years on the planet. The first was in fall 1976 when I left college at the end of my junior year and moved to Spain. Backing up a little; I was discharged from the Green Machine in April 1973 started college in the fall of 1973 - probably a little bit too short of a transition time but I did not know that then. I was motivated! I sat in the front of all my classes and asked lots of questions - I figured that I was paying the professors' salaries, so I needed to know all that they knew.

Then, after going to school full-time, summers included, I hit the wall of "why am I doing this?" in the winter of 1974-1975 and barely made it to May of that year. At the same time, I had been hang-gliding for about a year and decided I needed to see what that was all about on a full-time basis. I had a friend named Stuart who was an incredible pilot and was pioneering new advances in design and practices for flying hang gliders. He had constructed a flight park for gliders on a farmer's field and hills in mid-state New Hampshire, and it was literally "taking off."

Unfortunately for Stuart, what he did not know, combined with hubris proved to be fatal for him. On a beautiful summer day in early June, as he took off from a concrete ramp at the flight park, he had just entered a turn, stalled, went inverted, and the glider structurally failed. He then spiraled down to the ground from 500 feet and died from the impact.

Getting High in the Sky!

Before he died, Stuart had mentioned that he had been in Spain at a ski area in the Pyrenees the previous winter flying hang gliders and getting paid for it, but he did not want to go back. He said that he could connect me with the right people for me to go and take his place, with a living situation and a job! I thought about it for one second and said yes. Even better, his Spanish girlfriend (my living situation) was coming to the US to tour around with him after the summer of 1976. His girlfriend, Amaya, was present when Stuart's glider folded up like an inverted umbrella and was first at his side as he died. After the funeral, she left to return home to Spain, and I thought the whole dream in Spain was over.

The farmer that owned the flight park called me shortly after Stuart's accident and asked me if I could take Stuart's place for the summer to manage the park, and I immediately agreed. It was a great summer; I flew a lot, taught a lot, and just plain had a great time. In August, I received a call from a gentleman in Barcelona who was calling to inquire when I was coming to Spain! I was floored but said I could be there in early October. He gave me some details, we conversed a few more times by phone and post, until I jumped on an all-night flight from Boston to Madrid in October of 1975. Good to my caller's word, a young woman named Elena, was waiting for me at the airport and was there to transport me on the 12-hour drive to Arties, Spain. After a very long and slow trip in her Citroen Dos Caballos, we arrived at midnight to my new home; Amaya's personal residence, in a village built by the Romans in the 4th century.

Es Espana

The following year was a fantastic learning experience for language, culture, life, self-imposed poverty, and knowing how different Spaniards were from Americans. After six months, I could function at an 8th grade level in Spanish; enough to freely converse with the locals and business contacts. I also then started to understand that I would most likely never become Spanish - our two cultures were too far apart. Nonetheless, I continued on; after becoming a Spanish resident, I competed and became a member of the six-person Spanish National Hang Gliding Team going to Kossen, Austria in July 1976, for the International Competition. We numbered 4 Spaniards, one Australian, and me. (It was very new sport in Spain, and there were only 4 Spaniards that could qualify to fly at a high level of competence.) We did a great job of representing the national flag, but we got "whupped" by the Americans and the Germans.

After returning to the mountains, I had become increasingly bored with the sameness of the hang gliding life and the singular points of conversation with my comrades. In August of that year, we went to the Canary Islands for a regional competition. A serendipitous fluke in the trade winds produced a steady 20mph wind for an entire day with me flying a record 8 hours at 500 feet off some cliffs on the coastline of Grand Canary Island. When I landed; rather than feeling elated, I was just empty. I realized that I had climbed the far-off mountain I had always sought, and I was finished with hang gliding.

Shortly after that, I packed up and left for Boston. Before I went, I called the Dean of Admissions at my college and inquired if I could be admitted for the fall season, set to begin in just a few weeks. I had GI Bill and access to student loans, so he responded in the affirmative. I came home, ready to finish my final year and it was a great one.

What did I learn from this fantastic year in Spain? A couple of things.........one, I was not Spanish and never would be; I am an American and always will be. The laid-back Spanish lifestyle just didn't work for me, even though I love the people and will forever treasure the time I spent there.

The Wizard of Oz

Two, I finally realized that I was really looking for myself - fulfilling the old phrase - "who am I" and I did not find that answer. I happened to catch the classic 1939 movie, ‘The Wizard of Oz’ while I was in Spain (in Spanish!) and a couple of lines from that excellent adult movie resonated with me. One was when the team had returned from killing the Wicked Witch of the West and were seeking their rewards from the Wizard. Even though he could not produce what they wanted, he did change their thinking about what they thought they desired. The best one was for the scarecrow who wanted a brain. The Wizard responded, "You don't need a brain; you need a diploma." Such wisdom.

Then he finally came to Dorothy, and the plot takes us all the way back to Kansas when she wakes up, and everyone she loves is all around her. At some point, she states, "What I learned was, that if you can't find your heart's desire in your own backyard, then it isn't really your heart's desire." Wow! That hit me hard as I realized that it was true for me, too. I had traveled 3,500 miles to find out what I already knew. Would I trade that year for another? Never.

Seek and Ye Shall Find

This is where you come in, my friend. Go and seek what you want in far off places. Find your smile and enjoy your life. Even if you don't find any answers, the journey alone will be worth it. In closing, "Adventure is never in the guidebook and beauty is not on the map."

"Sex, Power, & Hysteria"

NOTE: MY APOLOGIES!! Due to operator error and a very efficient list server, I re-sent last week's blog by Bruce Boesky under a title I was considering for this week's offering. Here is the correct post for this week.  As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/.

Now That I Have Your Attention
I have been observing a significant and long overdue social change coming about since Harvey Weinstein was outed in October as being a sexual predator and has been at least for two decades. I think that all of the news and subsequent outings of other predators has served to empower all people that have been affected by a predator, male and female, to come forward and state, "Me, too." I say, "Bravo!"

"She's a Witch!"
In 1975 the genius British comedy troupe, Monty Python, released the first of many hilarious and controversial movies,
'Monty Python and The Holy Grail.' There is a scene in the film where a group of medieval villagers is clustered around an officious looking person on a platform leading a mock trial of a woman who has been accused of being a witch. One gent steps forward and screams, "She turned me into a newt!" The crowd grows quiet and sheepishly, the same gent (obviously now not a newt) states, "Well, I got better." The crowd immediately roars out, "She's a witch!" She is then summarily dunked into a pond and drowned as a witch.

Historically, this same type of sordid event happened in Europe as well as in the colonies of New England. The Salem Witch Trials were a series of hearings and prosecutions of people accused of witchcraft in colonial Massachusetts between February 1692 and May 1693. The trials resulted in the executions of twenty people, fourteen of them women, and all but one by hanging. Five others (including two infant children) died in prison.

Twelve other women had previously been executed in Massachusetts and Connecticut during the 17th century. Despite being generally known as the Salem Witch Trials, the preliminary hearings in 1692 were conducted in several towns: Salem Village (now Danvers), Salem Town, Ipswich, and Andover. The most infamous trials were conducted by the Court of Oyer and Terminer in 1692 in Salem Town.

The episode is one of Colonial America's most notorious cases of mass hysteria. It has been used in political rhetoric and popular literature as a vivid cautionary tale about the dangers of isolationism, religious extremism, false accusations, and lapses in due process.

My Story
From 1987 to 1990 I was the CEO of a statewide medical society. Walking into my first role as the titled leader of an organization, I was very enthusiastic about all of the challenges facing me; shortage of revenue, a dysfunctional Board, and staff morale problems. What I wasn't prepared for was what my predecessor warned me about as he walked out the door; "Be careful about the Program Director, she's a black widow and poisonous to the entire organization."  Incredulous, I asked him why he didn't address this personnel issue in the seven years he had been there. He responded that he feared a lawsuit and wished me "good luck" on his way out the door. WOW!

Over the next several months his parting remarks became all too true and, according to the terms of the personnel policies, I was forced to put her into a 90-day probationary status. This was after I had issued countless verbal and written warnings about her lack of professionalism and her propensity to foment toxic office politics, as well as not doing her job! At the end of the 90-day period, I terminated her employment, but I had to escort her to the office door since she refused to leave.

Within two weeks, a lawsuit arrived on my desk from her lawyer, claiming that I had wrongfully terminated her, sexually harassed her and that her dismissal was due to racial discrimination. Consulting with our lawyer, he stated that, "in the vernacular, this is called a kitchen sink lawsuit; throw everything at the wall and see what sticks." Upon informing the Board, there was a mixed reaction to this news; half of them wanted to accede to her demands, the other half wanted to fight it. I weighed in and said I wanted to go forth and take this issue to the wall - I was not in the wrong. They agreed, but I could already see that their confidence in me had ebbed a bit.

Over the next 18 months, both sides' lawyers started the discovery process of trading letters, performed depositions,
and prepared for a point when we could make a reasonable judgment of whether we wanted to go to trial or settle. Finally, it was my turn to be deposed by her lawyer, an all-day affair in a room with hot lights and no AC. At the end of the day, her lawyer looked deflated, and when my attorney and I returned to his office, there was an urgent message for a return call to her lawyer. I stayed for that call and listened in a while her attorney offered an enormous reduction from $500,000 in her client's demands for restitution and other items. My attorney looked at me, and I said emphatically, "Hell, no."

The next day completed my deposition, and then it was her turn. My attorney systematically took her claims apart to where it became clear to everyone in the room that she was lying and at the end of the day, her attorney slumped forward on her elbows and asked my attorney if she could call him again. This time she offered to throw out everything but a face-saving amount for $10,000 and a hold harmless document which we would both sign and then get on with our lives. Initially, I said no again, but my attorney reminded me that it could be two more years before we went to trial and didn't I want to be rid of this whole mess? At that, I agreed, and we all walked away.

Here is My Point
I am not trying to straddle the divide between the sexes; I fall squarely on one side of the chasm and, as a result of the preceding two-year hell of my own experience, I virtually sweat when I sniff sex panic. But here is where I pull it all together, from Monty Python to the Salem witch trials and all of the way to today's news. I am concerned about two fundamental things - moral panic and context.


A moral panic is always a reaction to something that has been there all along but has evaded attention—until a particular crime captures the public imagination. Sex panics in the past have begun with actual crimes but led to outsize penalties and, more importantly, to a generalized sense of danger. The object of fear in America’s recent sex panics is the sexual predator, a concept that took hold in the nineteen-nineties. The sexual predator is characterized by his qualities perhaps more than his actions—hence the need for preventive detention and sex-offender registries. The word “predator” is once again, unnervingly, becoming central to the conversation.

What has also been missing for me in the last three months of news has been context. The moral outrage and the
response have been very similar to the cry, "She's a witch!" I would like to see the latest sex panic news not just spit out almost in real-time, but very similar to a legal proceeding, have both sides present the context of the alleged transgressions so that we can make our own judgment versus the defendant being tried in absentia by the mainstream media.

The Bad News
The current balance of power favors men so much that it’s more than likely that the guilty will get away with it than the innocent will suffer. Still, we would do well to be aware of the risks to our perception of sex, and to this culture, as it grows ever more divided.
 

An Ego Boost or Self Delusion?

Note: I recently met a gentleman named Carl Dierschow, who owns/runs a consulting company called "Small Fish Business Consulting" (carl.dierschow@sfbc.com). We had a great discussion centered around our philosophy, what we do and the services we provide. I guess he enjoyed the conversation so much he asked for my permission to write a blog post of his own about me! Enjoy! Previous installments of my weekly blog are located on my website at http://stevemarshallassociates.com/steves-blog/
 

Carl Dierschow SM article.png

By Any Other Name, It is Still the Same!

Note: I have always wondered why we are obsessed with symptoms, instead of causes. This past week's accumulation of events makes me ponder and write. Enjoy! Previous installments of my weekly blog are located on my website at http://stevemarshallassociates.com/steves-blog/

Why Are We Lonely at Work?
“While dozens of technology tools should help us communicate in more personal ways, they do not. Instead, they often isolate people,” author Dave Crenshaw writes. In the workplace, people are in the habit of switchtasking (the reality of multitasking), moving from activity to activity — and we carry that over into communication. But you can unlearn the habit: Try to consciously slow your brain down while speaking with someone and focus on the conversation. “When you do this, jumping in and out of email while having a conversation with a coworker, you are conditioning your mind to view human beings as nothing more than vending machines.” Dave Crenshaw*

Why Are We Lonely in Life?
We're living in what I call an epidemic of loneliness. Recent research has shown that many of the people we feel close to probably don't reciprocate the feeling. Millions of men feel like they have no one they could turn to for emotional support. In 2015, TIME magazine—never one to shy away from big bold pronouncements—ran a story titled, "Why Loneliness May Be the Next Big Public-Health Issue." And recently, the New York Times even pointedly questioned whether your friends actually like you.

American culture is so far off the scales in this idea of separation and individuation. It's embedded in our DNA at this point. So at the very get-go, when we're little kids, we get fed into the competitive pipeline, and that gets reinforced—the more and more you do on your own, the better person you are. That becomes the value: "I should be able to do these things on my own."

But then we find a partner and the very skills that would actually allow us to have a good, stable relationship and partnership in life tend to be missing. For some people, they're so competitive that it's hard for them to move into that place of not being domineering, and not being the one who's right. For other people, it's literally just missing the skill set. How does one argue, how do we listen, how do we speak your voice—all of those absolutely essential relational skills get lost in this hyper-intense competition to stand alone at the top of the heap.

Relationship is at the core of human health and well-being, not isolation. Not individuation. Everything grows out of relationships, not away from relationships—we have the model that from when you're born, socialization leads to ever-increasing levels of independence. That central premise just gets us off to the wrong start.

WHO Prediction
The World Health Organization stated on March 30, 2017, thatdepression (depression is a common mental illness characterized by persistent sadness and a loss of interest in activities that people typically enjoy, accompanied by an inability to carry out daily activities, for 14 days or longer) is the leading cause of ill health and disability worldwide. According to the latest estimates from WHO, more than 300 million people are now living with depression, an increase of more than 18% between 2005 and 2015. Lack of support for people with mental disorders, coupled with a fear of stigma, prevent many from accessing the treatment they need to live healthy, productive lives. By 2025 they predict that figure to increase to 1 in 5 people worldwide will be living with depression.

Here's the Really Bad News
Fewer than 25 percent of people across the world have access to treatments for depression. The World Health Organization recently studied what it calls the “treatment gaps” in mental health care and found that worldwide, the median rate for untreated depression is approximately 50 percent.

The Results?
People with depression typically have several of the following: a loss of energy; a change in appetite; sleeping more or less; anxiety; reduced concentration; indecisiveness; restlessness; feelings of worthlessness, guilt, or hopelessness; and thoughts of self-harm or suicide. As a result, they also become increasingly isolated from other people and develop a profound inability to form relationships.

Ronald Reagan Started the Ball Rolling
Really? What did he do? Let all of the mentally ill patients loose? Well, yes, that’s precisely what he did.

In 1963, President John F. Kennedy signed the Community Mental Health Act to provide federal funding for the construction of community-based preventive care and treatment facilities. By 1977, there were over 650 community health facilities in the US serving over 1.9 million mnetally ill patients a year.

When Reagan was elected President in 1980, he discarded a law proposed by his predecessor, Jimmy Carter, that would have continued funding these same federal community mental health centers. This basically eliminated services for people struggling with mental illness. Federal mental health spending decreased by 30%. More than one million patients were released as a result of this legislation. Some were taken in by nursing homes, many became institutionalized in prisons, and the rest became homeless.

He made similar decisions while he was the governor of California, releasing more than half of the state’s mental hospital patients and passing a law that abolished involuntary hospitalization of people struggling with mental illness. This started a national trend of de-institutionalization. In other words, if someone is struggling with mental illness, they can only be helped if they ask for it. But, wait. Isn’t one of the characteristics of severe mental illness not having an accurate sense of reality? Doesn’t that mean a person may not even realize he or she is mentally ill?

Here's My Point
Taking a theme from my strategic planning playbook, we in America have a hard time distinguishing between the critical hierarchy of Why, What, and How. As a rule, we default to the how because that's most comfortable and we are good at it - just go to YouTube, and you can easily find out how to do anything from fixing your lawnmower to making a perfect chocolate cake.

Last weekend, yet another human being took it upon himself to eliminate other humans violently and horrifyingly. Did he have a mental illness? The American Psychiatric Association defines that as, "Mental illnesses are health conditions involving changes in thinking, emotion or behavior (or a combination of these). Mental illnesses are associated with distress and problems functioning in social, work or family activities." By their definition, the answer is assured yes.

Here is where Why, What, and How come into the picture. Rather than focusing on why he did what he did, or the reasons for what he did, as a nation and our government jump right to the how of what he did and the quick fix - banning certain types of firearms. This is only a bandaid to the more significant questions around what we as human beings have come to in the 21st century - how do we use technology so that it improves real communication between us and not separate us? And, when will we address the severe and socially stigmatizing issue of recognizing mental illness for what it is? Mental illness is nothing to be ashamed of. It is a medical problem, just like heart disease, diabetes, or cancer.


* Dave Crenshaw is the master of building productive leaders. He has appeared in Time magazine, USA Today, FastCompany, and the BBC News. He has written three books and counting, including The Myth of Multitasking which was published in six languages and is a time management bestseller.
 

What? A Value Proposition for Non-Profits?

Note: Value propositions are essential for any company; why not non-profit corporations? Here are two case histories of recent nonprofit clients that needed some help with that. Enjoy! Previous installments of my weekly blog can be found on my website at http://stevemarshallassociates.com/steves-blog/

A Little Background

In 2016 Americans donated $379 billion to nonprofits in the USA. This is a record-setting amount since statistics started being kept in 1954. What is even better about that number is that, after adjusting for inflation, charitable giving by Americans was seven times as big in 2016 as it was 62 years earlier.

Of course, one reason total giving went up is that the U.S. population almost doubled. But if we recalculate inflation-adjusted charitable giving on a per capita basis, we see that has also soared: by 3.5 times! (Source - Philanthropy Roundtable - http://www.philanthropyroundtable.org/almanac/statistics/)

Set the Wayback Machine, Sherman!

In 1978, my first professional job was as the Director of Business Development and the Foundation for a community college just south of Seattle, WA. At that time, there were just over 300,000 501(c)3 corporations (nonprofits) in the US and Americans donated $100 billion during that year. In 2017, there are 1.7 million nonprofits in the US, and as you saw above, Americans donated $379 billion to these entities.

At that time, as it is now, most donations come from individuals who have disposable income - historically most people start giving gifts in their early 40's - and by comparison to today's giving environment, if you asked someone for a gift, you probably got one. I credit this to a number of factors, but here are a couple of biggies; there were far fewer nonprofits, and there was more institutional trust in companies and organizations. (NOTE: Today, just asking doesn't necessarily get you a gift, but it's a good start!)

 All of the above serves as a backdrop for the subject of this article; i.e., the value proposition for a nonprofit; ergo, their mission statement. Because of the nature of the beast - a community college - we had to create a value proposition since alumnae attending a community college in 1978 weren't there for acquiring socialization skills; they were there to learn a trade like welding or carpentry, or a degree in something like accounting or drafting. Minus the nostalgia of a shared experience gained in the traditional halls of higher education we couldn't count on alum's for support nor could we look toward corporations or foundations for funding - community colleges in Washington State were entirely funded by legislative action tied to the taxes that residents paid to the state treasury.

Who Was Left?

The only body of people remaining to look to for support was the residents of the local community; about 30,000 good people who lived there because it was a bedroom community of Seattle just 25 miles away and the Boeing Company,

employing 80,000 workers, was even closer. Once an agricultural town, urban sprawl had made land much too valuable for that endeavor and so houses were being built like crazy on what used to be vast cornfields. What was missing in this transition from an agrarian environment to a city was an identity and pride of place.

The college foundation convened the first of several meetings with city government departments to form a partnership between the two entities to surface common issues and solutions provided in some cases by - you guessed it - the community college! Over the several years I was there, we were very successful in bringing the city together with the college by making the college a valuable community asset as well as an essential partner with the city. (How we did that could be the subject of another post. Here'a hint, though; think about philanthropy as the vehicle for funding the margin of excellence!)

To the Point

In the past several months I was involved with two separate nonprofits desiring to support their expansion plans through philanthropic investment. Here are the scenarios and results as follows:

Client A

Client A wisely undertook a planning study to ask their most valuable customers if they would assist in supporting their expansion plans. The result was telling - all of the major potential investors could not ascertain the substance of their value proposition! In this particular situation, the value proposition was actually present, but the client had not realized how important this was in today's charitable fundraising market, so it had never been communicated by the client to their customers.

In 1978 this client would have most likely succeeded in raising the money they desired because the underlying message they were broadcasting to their customer base was, "Trust us to know what's the best use for your philanthropic investment."  In 2017, that just doesn't fly. Our final recommendation to them was to assemble this information, package it, and communicate a strong and relevant value proposition to their customer base and, only then ask them again for an investment.

Client B

This client, a university, also commissioned us to do a planning study with a similar audience to Client A's, but their value proposition was some 20-30 years out-of-date. Their message to their constituency was, in essence, "Give us money because we need it."  What made this even a harder sell was that they were surrounded by 100+ other universities essentially asking the same customers for the same thing. Looking at the Venn Diagram, what was missing for Client B was a lack of understanding of themselves and clarity of all three of the critical circles in the diagram, and as a result, they could not iterate their value proposition clearly to their customer base. Our recommendation to them was to:

  • Review their mission statement (value proposition) and update it to more clearly differentiate themselves from the other 100+ marketplace offerings, research who their primary customers were, and what their customers needed in comparison to what they were offering;
  • Then, review the plan we discussed with their investors, take the time to thoughtfully craft a more relevant plan in line with their new value proposition; and,
  • Start the process of preparing to go back to their constituencies at a later date. 

Trends

Modern-day nonprofits looking to raise millions (or billions) should be looking for wealthy philanthropic investors to partner with them to solve common issues and challenges versus looking for a handout. Collaboration and partnering are two very key words in today's philanthropic arena, as donors are demanding more efficiency and less duplication of effort from the 1.7 million non-profits in America.

The Answer to the Question?

Hopefully, you can now respond to the primary question asked by this post with a resounding YES! Nonprofits need a stronger value proposition more than ever; the competition for the charitable dollar in 2017 is fierce and (most) major donors do not make giving decisions based primarily on emotion as many of them once did. Rather, they look at it much like they would for any investment; what's the R.O.I.; in other words, if I give $100,000, what can the nonprofit do with that money to multiply it to $1,000,000 in programs and services for the populations which they serve?

 

 

 

 

 

What Does Great Communication Look Like?

Note:  Working on a new piece that's not quite finished and since it is a holiday weekend, here's some great wisdom from Elon Musk from Inc. Magazine that I really like. Enjoy!

Throughout the years, billionaire entrepreneur Elon Musk has demonstrated the art of masterful communication.

The following is a perfect example: It's a copy of a previously unpublished email Musk sent to Tesla employees a few years ago. Sent with the subject line "Communication Within Tesla," it explains the problem with how information is transmitted in most companies, and how things should be different at Tesla.


Here's the email (which Tesla has verified was sent to all employees):

Subject: Communication Within Tesla

There are two schools of thought about how information should flow within companies. By far the most common way is chain of command, which means that you always flow communication through your manager. The problem with this approach is that, while it serves to enhance the power of the manager, it fails to serve the company.

Instead of a problem getting solved quickly, where a person in one dept talks to a person in another dept and makes the right thing happen, people are forced to talk to their manager who talks to their manager who talks to the manager in the other dept who talks to someone on his team. Then the info has to flow back the other way again. This is incredibly dumb. Any manager who allows this to happen, let alone encourages it, will soon find themselves working at another company. No kidding.

Anyone at Tesla can and should email/talk to anyone else according to what they think is the fastest way to solve a problem for the benefit of the whole company. You can talk to your manager's manager without his permission, you can talk directly to a VP in another dept, you can talk to me, you can talk to anyone without anyone else's permission. Moreover, you should consider yourself obligated to do so until the right thing happens. The point here is not random chitchat, but rather ensuring that we execute ultra-fast and well. We obviously cannot compete with the big car companies in size, so we must do so with intelligence and agility.

One final point is that managers should work hard to ensure that they are not creating silos within the company that create an us vs. them mentality or impede communication in any way. This is unfortunately a natural tendency and needs to be actively fought. How can it possibly help Tesla for depts to erect barriers between themselves or see their success as relative within the company instead of collective? We are all in the same boat. Always view yourself as working for the good of the company and never your dept.

Thanks,
Elon

I'm a huge fan of the message this email communicates, namely:

Communication that is forced to go through the "proper channels" is a recipe for

  • Killing great ideas; and
  • Burying the feedback a company needs to thrive.

There's only one problem with Musk's proposed solution - It's extremely difficult to cultivate in the real world.

Why Great Communication Is Hard

All companies say they value transparency and honesty. Most are lying.

Has Musk been able to achieve this type of environment (where communication is free-flowing and departments work together) at Tesla? I have no idea.

However, I worked several years for a nonprofit that did exemplify this way of thinking. It was an extremely mission-driven organization, one in which nearly everyone bought into the philosophy because they saw managers and executives walking the walk. (In fact, it was a personal experience there that inspired my very first column on Inc.com.) After leaving that organization and consulting for dozens of others, I realized just how rare this type of workplace is.

So how do you build a company culture in which employees actually work together, instead of against one another?

Ask yourself the following:

  • Do I see the big picture in my organization? Does my team?
  • Do I encourage dissenting opinions and viewpoints? Do I reward employees for giving me authentic feedback, even if I don't agree with it?
  • Do I demonstrate empathy, by taking employees' problems seriously--and actively helping them find solutions?
  • Do I promote an environment that encourages growth, even if it means (at times) losing a great employee to another team, another department--or even another company?

Of course, leaders have to set the example. That means looking beyond individual achievements and key performance indicators, which takes courage, insight, and emotional intelligence. It means making yourself available to hear as many voices as possible.

Above all, it means being ready to hear what employees really think.

Because the first step to solving a problem is knowing it's there in the first place.

 

You Talk Too Much!

Note:  I had a major jolt to my psyche in the past two weeks from two different clients. As well as I think I know myself, then events can come along to surprise even me. See if you can identify with the following. Enjoy! Previous installments of my weekly blog can be found on my website at http://stevemarshallassociates.com/steves-blog/

Can Your Personality Derail Your Career?
After the feedback I got from two different clients in two different parts of the country, I have become a believer that you can learn something new every day, no matter where you are in your career. For me the news I received about my interaction with these two consulting clients really rocked my world and potentially could influence my future in a very negative way. So, what was it that they told me? Simply put, I talk too much and don't listen enough!

I cannot just blow this type of criticism off, either. I have been doing planning research for two different organizations, which involves interviewing a lot of their customers, and some of these people actually contacted my clients to point out that, while the interviews may have been informative, they had a hard time giving their reactions to the plan that was presented to them by me, because I talked too much.

What's Going On Here?
As someone who has spent many years counseling people and more recently, executive coaching CEO's and leaders, this concept of active listening is fundamental and a prerequisite to the fields of endeavor wherein, as human beings, we try to assist others through hard patches in their lives and/or serve as a guide to help them know more about themselves and achieve higher performance in their interactions with others in the workplace. Now I come around to the question for myself; "where and when did I go off the rails?"

The Answer Lies in My Psyche
Twenty years ago, two psychologists, Robert and Joyce Hogan, created an inventory (the Hogan Development Survey) of the “dark side” traits of human personality —11 qualities that when taken to the extreme, resemble the most common personality disorders. After profiling millions of employees, managers, and leaders, they found that most people display at least three of these dark-side traits, and about 40% score high enough on one or two to put them at risk for disruption in their careers — even if they’re currently successful and effective. The result is pervasive dysfunctional behavior at work.

Research over decades suggests that it’s challenging to change core aspects of your personality after age 30. But you can — through self-awareness, appropriate goal setting, and persistence — tame your dark side in critical situations, by changing your behaviors. First steps first, though; you have to identify the unproductive behaviors.

Understanding the Dark Side - There are Three Clusters
Those in the first are distancing traits—obvious turnoffs that push other people away. Being highly excitable and moody has this effect, for instance. So does having a deeply skeptical, cynical outlook, which makes it hard to build trust. Another example is leisurely passive-aggressiveness—pretending to have a relaxed, polite attitude while actually resisting cooperation or even engaging in backstabbing.

Traits in the second cluster are, in contrast, seductive qualities—geared to pull people in. They’re often found in assertive, charismatic leaders, who gather followers or gain influence with bosses through their ability to “manage up.” But these traits can also have negative consequences because they lead people to overestimate their own worth and fly too close to the sun. Being bold and confident to the point of arrogance is a good example; so is being puckishly mischievous, with an enormous appetite for reckless risk.

The third cluster contains ingratiating traits, which can have a positive connotation about followers but rarely do when describing leaders. Someone who is diligent, for instance, may try to impress her boss with her meticulous attention to detail, but that can also translate into a preoccupation with petty matters or micromanagement of her own direct reports. Someone who is dutiful and eager to please those in authority can quickly become too submissive or acquiescent.

Not all dark-side traits are created equal. In a global meta-analysis of 4,372 employees across 256 jobs in multiple industries, distancing traits had a consistently negative impact on individuals’ work attitudes, leadership, decision making, and interpersonal skills (reflected in poor performance ratings and 360-degree reviews). But the seductive traits sometimes had positive effects. For instance, colorful, attention-seeking leaders often get better marks from bosses than their more reserved counterparts. And bold, ultra-confident CEOs often attain high levels of growth in entrepreneurial ventures. Dark-side traits also differ in their consequences. A mischievous, risk-taking leader who is under pressure to demonstrate financial growth can destroy an entire organization with a single impulsive decision. An excitable leader might simply wreck his/her career with a public temper tantrum.

It’s worth noting that a complete lack of these traits can be detrimental as well. An extremely calm, even-tempered, soft-spoken manager—someone who isn’t remotely excitable—may come across as dull or uninspiring. The key, then, is not to eliminate your personality weaknesses but to manage and optimize them: The right score is rarely the lowest or the highest but moderate.

Managing Your Dark Side
If you are in a situation where it's possible, complete a full psychological assessment to identify your potential derailers. Even better: Ask bosses, peers, subordinates, and clients to give you honest and critical feedback on your tendency to display these traits. Tell them that you want to improve and need their candor. How do they see you when you’re not at your best? Do any of the traits sound a little (or a lot) like you? You might mention a pattern you’ve noticed or that others have commented on. You can improve your self-awareness through formal feedback mechanisms, such as performance appraisals, 360s, check-ins with your manager, and project debriefs. The key to gathering accurate information is to recognize that people will generally avoid offering critiques, especially to leaders, unless the behaviors are truly egregious. So in addition to assuring them that you welcome their honest assessments, you should listen carefully for subtle or offhand remarks.

Where Do I Fit In?
After taking the Hogan Development Survey and looking at the three clusters, I land pretty squarely in the middle cluster - seductive - I am geared to pull people in, and my workplace life has reflected that with many leadership positions and an inherent ability to manage up. The question remains, though, why has this personality cluster trait suddenly exhibited itself so dramatically and dominantly in my behavior?

One answer that comes to me is age; I am at a point in life and work where the opportunities to feel valued and worthwhile don't seem as plentiful as they used to be or better yet, I am not making those opportunities happen! Even though I felt some deep humiliation from the feedback I received, I also believe that a healthy dose of humility is always good to remind us that we are human and keep us from flying too close to the sun.

Note: Special thanks to Tomas Chamorro-Premuzic, CEO of Hogan Assessments, a professor of business psychology at University College London and Columbia University, and an associate at Harvard’s Entrepreneurial Finance Lab. His recent article, "Could Your Personality Derail Your Career" (excerpted here) from the Harvard Business Review couldn't have come at a more opportune time for me to help me untangle what is going on amidst the flotsam and jetsam called my mind.

Lead, Follow, or get the Hell out of My Way!

Editor's Note: One of my pet peeves and a quality that I search for but rarely find. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/


Who Said That?
Variously attributed to Thomas Paine, George Patton, and more recently, Ted Turner and Lee Iaccoca, no one, including Saint Google, is sure who actually said it. I think that it is an enduring sentiment and one that is hard to find in America today.

Lead!

It’s hard to be a real leader. Decisions are never black or white, so most people fudge. They straddle middle grounds to keep everybody happy. They make compromises to try and hold together constituencies. On business decisions, they want to hedge their bets, so they do a little bit of everything but nothing extremely well.

As highlighted by Brad Garlinghouse years ago in the famous “peanut butter manifesto”— it’s like spreading peanut butter evenly over a piece of bread. And of course fudging never produces world-class results, so many companies suffer from mediocrity.

The problem with hard decisions is that you can never make everybody happy. There is always somebody impacted or somebody who thought that “Plan B” was better. Leadership is about listening to multiple opinions but in the end trusting your instincts and deciding. Leadership is about not worrying about how people will think about you for hard calls. It is about being willing to be wrong. Leadership, as I’ve pointed out before, is about being respected more than loved.

As somebody fortunate enough to spend time with senior people from business and non-profit sectors I can tell you that even at the upper echelons people struggle to make hard decisions and the people willing to forge difficult paths are few and far between.

It was not a popular decision at all when Steve Jobs chose to open retail stores. People laughed at Google buying YouTube for $1.65 billion. Evan Spiegel was thought an idiot for not selling Snapchat for $3 billion. Netflix was widely criticized for breaking their business in two.

Leaders have well-formed opinions that go against the grain, the temerity to sell their vision to skeptics, the tenacity to stick to their ideas when they are inevitably criticized, the resiliency to wake every day when they’re being kicked by everybody for their beliefs but also the willingness to look at data and re-chart their course when they got it wrong.

Leaders need to be early, have conviction, be persuasive and get others to follow when rational people should not. And trust me, the world is FILLED with naysayers. Whether they succeed or not does not defeat their leadership and willingness to try.

Follow!

There truly aren’t many leaders; it’s a thankless and stressful job. And leaders aren’t always right and even when they are they don’t always win. And while leaders set direction, of course, it is teams that deliver results. The leader can only point and recruit world-class people, but the results are owed to the team.

In every team, you need the majority of the people who excel at their job functions. They are great within their respective fields whether they be marketing, sales, programming, PR, whatever. People running these job functions are also leaders — don’t get me wrong — on each team, you still need leaders & followers. You simply can’t have a team of people all pulling in different directions and death by a thousand cuts is having multiple departments all moving in their own direction.

While the overall leader must set the direction of the top, the goal is each department must be to align the objectives of that group with the overall goals of the organization. When done well companies have a system like OKRs (objectives and key results) or V2MOM (vision, values, methods, obstacles, measures).

If an organization and its people won’t align themselves with the direction from the top you will also end up with mediocrity. Only aligned organizations excel.

Get the Hell Out of My Way!

Dissent is fine. Dissent actually makes groups stronger. I love being challenged because it forces me to think harder about what my convictions are. I love when people come with ideas that conflict with my world view because the conflict either ends up giving me more confidence in my convictions or helps me to evolve. Sometimes it even causes me to consider revolution.

But dissenters need ideas of their own. Dissenters need facts and logic. Dissenters need to be willing to roll up their sleeves and help do the work. Dissenters need to be willing to have their own necks on the chopping block and admit that they were wrong in the end.

Dissenters don’t get to be “back benchers.” They don’t get to yell from the peanut gallery but never own results or the consequences of decisions. Dissenters don’t get to second-guess but never lead.

Throughout life, I’ve realized that many people are back benchers. “That will never work” is their motto. They like to criticize, but they don’t have strong ideas of their own. They “know” what’s wrong but they never do anything about it. They never lead. Yet they don’t follow.

When you spot people like that in your company, you have no choice but to part ways with them. If you wake up one day in any organization and you realize that you’re no longer “part of the solution” it’s time to get the hell out of the way. This is especially true when you’re senior and too many people are looking at how you react to change or when your disbelief undermines the confidence of others.

When you get the hell out of the way you either find out that the other leaders were right or you get the chance from the outside to later say they were wrong. But either way, you at least let your organization have cohesion in the plan.

And if you can’t lead, follow or get the hell out of the way — have the decency to move on to another organization.


Next Week: Growth - How Fast is Too Fast?

Who is the Greatest Leader in America?

Editor's Note: Last week, at the end of this blog, I postulated, "Now What?" The answer is simple, back to helping organizations be the best they can be while helping to reach their goals. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/
 

by
Patrick Lencioni

I have been asked on a number of occasions, by journalists and curious clients, whom I believe to be the greatest leader in America. And I usually respond with my own question, “Are you asking for the name of a famous leader?” This usually leads to a fair amount of confusion, until I explain that the best leader in the country is probably relatively obscure.

You see, I believe that the best leader out there is probably running a small or medium-sized company in a small or medium-sized town. Or maybe they‘re running an elementary school or a church. Moreover, that leader‘s obscurity is not a function of mediocrity, but rather a disdain for unnecessary attention and adulation. He or she would certainly prefer to have a stable home life, motivated employees, and happy customers—in that order—over public recognition.

A skeptic might well respond, “But if this person really were the greatest leader, wouldn‘t his or her company eventually grow in size and stature, and become known for being great?” And the answer to that fine question would be, “Not necessarily.”

A great company should achieve its potential and grow to the size and scale that suits its founders‘ and owners‘ and employees‘ desires, not to mention the potential of its market. It may very well wildly exceed customer expectations and earn a healthy profit by doing so, but not necessarily grow for the sake of growing.

Unfortunately, we live in a world where bigger is often equated with better and where fame and infamy are all too often considered to be one and the same. And so we mistakenly come to believe that if we haven‘t seen a person‘s picture on the cover of Fortune or in a dot-matrixed image in The Wall Street Journal, then they can‘t possibly be the best.

Consider for a moment those high profile leaders we read about in the newspaper and see on television. Most, but not all, of them share an overwhelming desire and need for attention. You‘ll find them in all kinds of industries, but most prevalently in politics, media, and big business. Look hard enough at them, and there is a decent chance you‘ll discover people who have long aspired to be known as great leaders. These are the same people who also value public recognition over real impact. And based on my experience, you might also find that they‘ll be more highly regarded by strangers and mere acquaintances than by the people who work and live with them most closely.

The truth is, our greatest leaders usually don‘t aspire to positions of great fame or public awareness. They choose instead to lead in places where they can make a tangible, meaningful difference in the lives of the people they are called to serve. The challenges and consequences of their decisions are no less difficult or important than those of higher profile leaders, even if they don‘t quite qualify for a cover story in TIME.

Editor's Note: I just met one of these leaders in the last few weeks; before that time I had never heard of him. He is much like the many unsung leaders that Patrick Lencioni describes above, and Mr. Lencioni was even once on his Board. His name is Dr. Tim Gray - look him up.

Next Week: Lead, Follow, or Get Out of the Way?

Moving On

Editor's Note: At this point, you must think I am either dumb or have appalling luck to have almost the same thing happen to me, twice! Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/


I Think Having Leverage is a Great Thing
Last week we left off with me finding out how deeply I could be pulled into the former owner's tax mess if he didn't pay the back taxes to the state; I could lose the business if they seized it for his disregard for the tax system. 

After I had spoken with my attorney, I called the former owner in Texas and laid out what he was facing, including me not making a scheduled payment to him at the end of April. I have heard engines sputter, but I have never listened to a person sputter, and it was almost funny, and he was furious until I told him to, "Shut Up!" Surprisingly, he did, and I followed with, "Listen." I had come up with a strategy with my attorney that got me out of this whole mess and left him with getting the business back and only having to deal with the department of revenue for back taxes.

He refused the proposal outright and said he was going to sue me in a civil action, at which point I laughed and replied, "For what? Because you tried to defraud me for $2 million under false premises?" I went on to say that I would be intrigued to see how this played out in the legal system and I might end up owning the business anyway. Then I dropped two bombs on him after he still refused my proposal. After operating the business for a few months, I realized that he had underreported the income on his federal income tax returns - remember - the revenue came in split into 60% credit card sales and 40% cash; he wasn't reporting the cash on his returns! Also, he had the four "employees" working as independent contractors and so, had paid no payroll taxes nor had any workmen's compensation in place for them. In our state, the Department of Labor is very attuned to this sort of activity and stick strictly to the rules that, if people spend all of their available working time at one job, they see them as employees. 

A Whistleblower - Again?
He said, "You can't prove any of that." My response, "I don't have to; the burden of proof is on you, and if I call either of these two agencies, they will surely investigate, and you could not stand up to either an audit from the IRS and/or a review of your employment practices. So, your choice; I walk away at the end of April, keep any and all net profit since I took over, and I say nothing to anyone about anything."  (Even better, for me, if they do find any wrongdoing, I could be eligible for a whistleblower reward!) I then hung up but left him with the thought that he had 24 hours to respond or I would make the calls.

He called me the next day and agreed to the proposal; his lawyer had convinced him to take the deal and get on with his life while I got on with mine. On April 30, 2017, with mixed emotions, I handed the keys to him and walked away.

Am I bitter? No, and I will still trust people until I find out otherwise. It was both a great life and business lesson, and I have no regrets whatsoever about engaging in this 5-month exercise. I will also stick by my promise to him about keeping quiet; I think he will be found out sooner or later anyway.

Next Week: Now What?

Shame on Me!

Editor's Note: In last week's episode, we left off with our hero(?) wondering where he was going to come up with $18 million to avoid all sorts of legal actions that would forever impact him and the organization he represented. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/


The Immense Power of Collaborative Thinking
There are a great many people wiser than I am and one of the things I have heard over and over again is, "One day at a time, one step at a time."

  • Step 1 - I put the CFO, and her team of accountings temps to work to see how much of the $18 million we could account for to provide documentation to the Feds and the other grantmakers to which we owed the money;
  • Step 2 - Begin conversations with the original Board Members to let them know how they had failed in their fiduciary responsibility to the organizations and its future.

At the end of a six-month marathon of forensic accounting, my hero, the CFO and her team, had accounted for close to $15 million of the grants which we duly forwarded to the grantmakers. The remaining $3 million was accomplished through fundraising from the Board(s) and a $500,000 promissory note, secured by the imminent distribution of a bequest. Then, we turned ourselves into the Inspector General for the Department of Justice to receive whatever punishment they deemed appropriate. As we thought, it was relatively minor, because, after all, we had repaid the money and, the worst part of their ruling was that the original entity was barred from ever being eligible for federal grants again. This judgment sounds worse than it was, as the original entity as a corporation would cease to exist in the next few months anyway.

The best part of this whole ordeal was that it brought the entire team of staff, volunteers, and professionals much closer together as a working team that endured long after we sent the feds their checks and the merger was complete. About the public, no one will ever know the gritty details of this shameful incident, and that is the way it should be in my mind. We transformed lemons into lemonade.........the hardest way possible.


Fool Me Twice, Shame on Me!
Fast forward ten years to 2016 and I am starting to think about the future; mine and those around me. As Frank Sinatra stated in his famous ballad about growing older, "It was a very good year," I am looking at the autumn of my career and seeking a business or an asset that can work for me, rather than working for it.  Then, I found the perfect business (or so I thought)! I had been frequenting a business for several years in my town and wondered what it would be like to own such an enterprise. I even had gotten to know the people that worked there very well and knew about all the strengths and weaknesses of this business. So, when the "For Sale" sign went up, I contacted the broker representing the owner and asked, "How much?" The number he gave me was sky high; about six times annual receivables (the staff told me this dollar figure) and I inquired whether he was in a situation where he would negotiate. The broker hemmed and hawed and finally said something I already knew; the owner had moved several states away and was a motivated seller (the staff was very helpful here, too; they hated him).

I decided to take the initiative and called the seller at home in Houston (the staff gave me his number!). I made an offer that was more reasonable to me - three times annual receivables, and he refused. I reminded him that his deferred CAPEX amounted to almost $750,000 and that any shrewd buyer would figure this out during diligence anyway, so, if he wanted to sell it, he would have to be a little flexible on the price. He left off that he would think about it and get back to me, which he did the next day and said he would sell it for four times annual receivables. I agreed but said that my terms would be some cash and the remainder in the form of a note from me to him for ten years with a balloon payment at the end of that period. We haggled about this, but he finally agreed, and we closed in December 2016.

I Bought a Car Wash!
Matt Damon starred in a very cute movie called, "We Bought a Zoo" in 2011, which told the (true) story of how a journalist bought a failing zoo in England and, with blood, sweat, and tears equity, brought it back to life. Nothing so dramatic in my case; it had been an operating business for 14 years and was still doing very well, grossing $500,000 annually. I looked at it this way; short of the planet running out of water, it was almost a recession-proof business. I even had an accountant review the owner's tax returns and his books before I said, "Yes" - the performance of this business was stellar. In addition to the regular people coming in once a week, I can't tell you how many people that would come in there with 19-forgotten cars and trucks and spend $10 to wash a rusted and faded paint vehicle. With just three part-time employees, and is in a very advantageous location next to a huge mall, anchored by a large Kroger grocery store, what could go wrong?

The Feds - Again!
In March 2017 I received a call from the (state) Department of Revenue looking for the owner. I responded that I was and asked how I could help them? The gentleman on the other end of the call immediately launched into a series of questions about the whereabouts of the sales tax reports for the years 2008 to 2015. I finally stopped him and said that didn't own the business during that time and had only recently acquired it in late 2016. He asked where he could find the former owner and I decided to stall a little bit and said I would have to find that information and call him back. My first call was to a contract law attorney I knew and asked him for his opinion on this matter, and he immediately said, "If he didn't pay the sales taxes due for that period, then your contract with him is null and void, and he has committed fraud." OMG! His next words gave me a chill as frosty as the Arctic; "And, if he doesn't pay the state or can't pay them for the taxes due, they will seize and close the business until they are paid."

Next Week: Moving on

Shame on You!

Editor's Note: Have you ever had one of those deja vu all over again moments? Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/


Fool Me Once, Shame on You
In 2005 I was retained by a major university to do a study on the feasibility of merging a once notable, but now failing, private cancer research center with a major cancer center within the university. I worked on this project for six months, interviewing a significant number of people affiliated with either or both entities and poring over internal documents and financials within the private research entity. Everything looked good for the merger, especially since the university was not willing to assume any of the liabilities of the other organization. If approved by the University's Regents, this merger would entail a good year's worth of work to finally complete the merger process; with the sale of assets, transferring grant portfolios, and obtaining faculty appointments for the private organizations' 48 scientists. One of the biggest hurdles would be the public relations challenges with dissolving a 100-year-old organization, but still, honor its legacy in a meaningful way for the future with its nationwide constituency. 

I delivered my report to the Board of Regents at the end of six months, and they approved the merger without any reservations. I was further retained to help create a transition board, made up of representatives from both organizations and put together an initial scope of work for this group, including hiring an interim CEO. At the end of two months, I was approached by the chair of the transition board and asked if I would be interested in a 12-month position as that interim CEO I had recommended in my report. With some reluctance, I tentatively accepted but decided I would try an old negotiating tactic of making the other side say, "no" by throwing in certain conditions that I thought that they would refuse, but they didn't, and I assumed the position at the beginning of 2006. 

The outgoing CEO had been in place for over 30 years and wasn't especially happy about being forced out, but since he was the primary author of its failure, he had little choice but to resign. He made some last ditch efforts to get a severance, but, given a massive budget shortfall in 2005, it was easy for the Board to deflect that request. He did drag his feet somewhat for about two weeks, by giving me excuses about how long it would take to clean out his office, but I had plenty to do in the coming 12 months, and so, I said, "take your time." After all, he couldn't do any harm, since he no longer had any signature authority and he had no loyal staff left, as I had let the majority of them go when I stepped in.

Surprise!
The first month passed by relatively peacefully, with many people to meet both onsite and at the University, new staff to hire, and planning for the future. In early February, I received a phone call from a bureaucrat at the Department of Defense, inquiring about the summary documents for a grant they had made several years before to the private cancer center. I said I would look into it and they sent a follow-up letter, which, at first glance, seemed fairly benign, until I got to the last page of this missive. Here is where the bomb dropped, the first of many, as they stated that without a full accounting for the grant they had issued, that they would expect full reimbursement of said grant - $1.5 million! I handed the matter over to our brand new CFO, with the proviso that she keep me informed. Over the next two months, I received a mounting pile of more phone messages and letters from various government agencies asking for the same as the first call; all in all, the total came to $18 million! This got my attention, and I asked the CFO how she was doing on the accounting end for the first grant call I got. Her response was bleak; it was doable but would take several months as virtually no accounting had been done internally, and she desperately needed help to recreate the internal accounting that went with each grant, now over ten grants. I instructed her to hire accounting temps and make it a priority.

My next step was to inform the Transition Board of possible malfeasance in the worst case, and sheer incompetence in the best case. I outlined my remediation steps, to include legal action against the former CEO and CFO, but I decided to give that CFO the benefit of the doubt, and so, I called her to inquire what she knew about this situation. Her first question to me was whether the former CEO had forwarded her letter asking for her severance pay - one year's salary - promised by the former CEO. I said I had not, but, regardless, that was not a promise I could honor given the current crisis and the previous budget year's failure. She threatened legal action, to which I almost laughed, but I chose to fill her in on the magnitude of the current $18 million demand from grantors instead and asked whether she could shed any light on that? She dissolved into tears and told me the whole tale of woe of the last several years of using restricted grant money to pay for annual operational needs and keeping a second set of books to keep track of the fraud. I requested those accounting docments, but she said she would trade them for her severance. I politley declined. Now, I was shocked twice; once for not discovering this during the financial review, which I had undertaken in 2005, and, second, how to resolve it.

I called the organization's law firm; one of the biggest and most expensive in the city, and met with two of the senior partners to outline the debacle. They listened sympathetically, and then they dropped an atom bomb on me. If I gave into mounting pressure from the Board to inform the Inspector General's Office in Washington about this matter, I would become a whistleblower for the government, and they would have to recuse themselves from representing me as they still represented the organization!

My first call, after this horrifying discovery, was to the Board Chair to inform him that I was resigning immediately and then told him why. He was certainly no less horrified than I was but reminded me that lawyers always looked at the worst possible outcomes and possibly, could we find any other solutions? After meeting for several hours and involving two key University people, we decided that we would recommend that we pay back the money first and then inform the Inspector General's Office. We took that recommendation to the Board, and they accepted it but they declined to pursue any legal action against the former CEO to avoid bad press for the University.

Now, the fun part began - where do we find $18 million?

Next Week: Shame on Me!

Could You Win the Healthcare Lottery?

Editor's Note: My old college friend, Bud Hendershot, wrote the following and sent it to his local newspaper in Florida as a guest editorial. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/

The Definition of Insanity

The Congressional Republicans have voted to repeal The Affordable Care Act (aka “Obamacare”) and replace it with a giant tax cut for the rich (a.k.a. The American Health Care Act/Trumpcare/Ryancare). This Republican healthcare plan is a complete joke and would – according to the CBO – result in at least 24 million Americans losing health insurance over ten years. The poorest Americans would be hit the hardest, of course – which is probably one reason this plan is more popular with Republicans than with everyone else. Remarkably though, polls show even a majority of Republicans don’t like this massive tax cut, umm, “healthcare plan.”

Republican Pols think healthcare is not a right – but a product that should primarily benefit only those rich enough to pay for it, or lucky enough to get it on the job. That’s obviously not a message they wish to advertise. But if they were more creative about their solutions, I think they could really excite many voters – especially the ignorant, the cruel, the greedy and the “I’ve got mine, screw you” crowd -you know, their base. So I have a few proposals I think would go over BIGLY with our new all Republican government.

Forget phony healthcare “plans”- it’s time for HEALTHCARE LOTTO! Each state could run a lottery with different scratch off games for different diseases, where winners could win various levels of treatment for maladies such as one free radiation treatment or insulin shot up to a Grand Prize of free health insurance – the same kind Congress gets!

Imagine – millions of desperately ill people who can’t afford health care lining up in local gas stations and grocery stores to purchase scratch-off tickets like “HAVE A HEART (TRANSPLANT!)”, “SCRATCH-OFF YOUR SHINGLES!”, “MATCH 3 FOR CHEMO!” or “E.D. BE GONE!” Such a system would generate many billions of dollars – half of which could be reserved for “prizes” – and the rest of which could be distributed upwards to billionaire GOP donors. HEALTHCARE LOTTO would give a sliver of hope for the desperately ill while making wealthy political donors even richer! A win-win for the GOP!

The only possible objection I foresee is that some of the more “moral” among GOP leaders may object to games like “MATERNITY CARE” if the winners are unwed mothers. Likewise, any prizes involving birth control would probably be excluded. You know – “Sanctity of Life” issues. But these things could be worked out.

Another idea would be a reality TV show along the lines of “The Apprentice.” You remember that show, don’t you? It starred Donald Trump. This show would be called “The Underwriter.” Trump would star in this show as well. With him, the show will get YUGE ratings – and we all know he loves that! Contestants would compete to get their application for health insurance approved through The Underwriter. Winners would beapproved for a health insurance policy for which they would pay reduced premiums. Losers won’t hear “You’re fired!” as they did on “The Apprentice.” What they’ll hear instead is “YOU’RE DEAD, LOSER!” Can you imagine the betting pools that would spring up all over America?

Short of regular live, televised executions, I can’t think of a show that would be more popular than “The Underwriter” in this sick country. You may think these ideas are crazy, but they are no more destructive than the “health care plan” Congress already passed and handed to the Senate. God help us all.

Thank you, Bud Hendershot!

Next Week: Shame on Me!

Why Do We Need To Be Agile?

Editor's Note: I received an email from Irena Papuc from Toptal Corporation this week, asking me to post this article from their blog about expectation management and planning. Even though this article is specifically about software development, it also applies directly to strategic planning. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/

Long ago, we roamed the land to gather food and shelter to survive. They were simple needs, but pretty agile. Some time later, countries and economies grew and prospered on the back of the Industrial Revolution. This was the birth of management and control and the loss of agility. Now we’re in the Information Age or Revolution, where businesses employ knowledge workers. Knowledge workers are you, your partners, your colleagues, and peers that endeavor to create great solutions to the customer, business, social, economic and world problems. Knowledge workers apply analysis, knowledge, reasoning, understanding, expertise, and skills to often loosely defined and changing needs. These businesses and workers need methods and techniques that cannot be met by old Industrial Age processes and procedures. Agile supports interactions.

Virtually no company can confidently set out at the beginning and know all that it needs in order to deliver valuable products without change. Change presents both opportunities and risks to the success of a project. Unmanaged opportunities can mean the difference between a great company and an awesome company. Unmanaged risk spells disaster and ruin. Agile manages change.

Adopting agile allows you to be responsive to changing or new requirements. It empowers development teams to be the experts and make decisions supported by an engaged, trusting, and informed business. It enables you to deliver to customers what they really want. Ultimately, it puts you and your organization in control of delivering high-quality products that deliver on customer need and expectations whilst extracting a return on your investment dollars as early as possible. Agile creates value.

There is a cost to adopting agile. It doesn’t come for free. Transforming to an agile approach for product delivery can be a hard path to follow. However, if you internalize the agile philosophy, tread carefully, engage the right team with the right attitude, break things down, make it achievable and realistic and respond to feedback, you will reap rewards. Agile emphasizes collaboration.

The following lists some benefits you can expect:

  • Speed to market
  • Earlier revenue generation
  • Regular delivery of real value
  • Protection for your investment
  • Data, data, data
  • Better product quality
  • Manageable expectations
  • Greater customer satisfaction
  • Higher performing teams
  • Improved visibility on progress
  • Predictability, transparency, and confidence
  • Manageable risk

“Success is not final, failure is not fatal: it is the courage to continue that counts.”

Winston Churchill may never have actually said this, but I think it’s a pretty good summation of Agile. We know Agile is the best foot forward for most projects. It encourages you to strive for success, but we always iterate and keep building on it. Agile will encourage you to fail, but fail early and move on. Having the courage to continue and to build the right solution based on insight informed by your customer is what brings the reward.

The thing to keep in mind is you can tailor Agile to your needs. Use the method and governance that is right for your business. Wherever you start, be true to the content, context, and spirit of the method you use - keep it vanilla. If you’re just starting out - Learn. If you’ve been doing it for a while - Understand. If you’re becoming awesome - Apply. Finally, if your business and your projects are complex and interdependent - Govern. Over time, you and your teams will figure out what works best for your business.

Feasibility

So now you’re thinking, “Okay, I get it. How do I start? Where do I start?”. Well, with all good things, we start at the beginning. And with Agile, it’s by asking yourself, “What business value do I want to deliver?”. After all, that’s why we undertake new ventures, to generate business value. In order to establish if the venture is worth undertaking to derive the business value, you need to understand whether it is feasible.

Vision

Is your venture projected to increase revenue, enter a new market, acquire more customers, improve customer perception, or make life easier for a given problem you’ve identified? With this in mind, you can state your “Vision”.

  • Your vision may come from different sources - your own bold startup to fix a common problem, business management strategy, your CEO’s pet project, a specific product team, or even your customer’s needs.
  • Try to take a step back from your own shoes and “see” what the future looks like with your new product or service in the hands of your customers.
  • Engage your stakeholders - the CEO, product guy, and customers. Workshop it, don’t attempt this in isolation. Challenge assumptions and validate arguments.
  • Write it down, keep it short. Focus on the business value.
  • Refine it until you all agree the vision resonates with everybody and meets a common interpretation that states where you’re heading.
  • Your vision, if valid, rarely changes. How you get there most certainly will.

People don’t buy what you do, or how you do it. They buy the “why” you do it. This is what creates the emotional connection between your business and your customers. The vision will help illustrate this.

Is it Feasible?

Feasibility comes in at least a couple of shades. Typically, you’ll want to understand if your vision of a brighter future for your business and customers is both technically feasible and that it’s feasible for your business to make it happen.

  • If your vision is to make travel to anywhere across the world in under an hour, you may have a problem with the technical feasibility. Since science, physics, and technology haven’t quite caught up with that dream yet, your technical solution may not be viable in anything other than theory. In addition, if your solution was new, this would go well beyond the idea of a Minimal Viable Product (MVP).
  • To test the technical feasibility of your product, consider either exploring it further in a Discovery prototype project or by running a spike in the early stages of the project. You’ll know which method to use by thinking about the scale or complexity of the solution you have in mind.

    “Some of the best knowledge my teams have gained in understanding technical feasibility have come from performing a spike. And often, it’s the simplest solution that wins out!”

  • The second shade of feasibility to consider is whether you, your team or business has the skills and motivation to make it work. Using an example, if you’re great at baking cakes at home for your kids birthday, that’s sweet. But if you want to turn this into a business selling the finest cakes to the world, you need to understand if you can make it scale, handle the business as well as the production, manage distribution and fulfillment, and take care of customer service.
  • This type of vision might be achievable in the long run. But for now, possibly not. So scale it back, think small, take a small chunk that looks realistic and concentrate on delivering the best but smaller aspiration you can. If that manages to engage and delight your customers, get them coming back for more and telling their friends, then scale it up from there using your customer feedback as your guide and compass.
  • Also, you need to know if your project is feasible in terms of budget and timeframe. Can your business afford to deliver this product? Is the timeframe achievable? Time and money are two of the three constraints in an Agile project that are fixed. We aim to deliver within a given fixed time and within a given fixed budget.
  • The quality of a product refers to the end product that your customers use and the engineering practices your team uses to deliver great, robust, and reliable software. Quality is also something we don’t short change on. Quality criteria, on the other hand, can change. If you’re not setting out to build a Ferrari, the product may not have a high-quality perception. If you’re not building space rockets, then the tolerances attained in production terms may be much higher. Set the appropriate tone and expectation early on.

So now you’ve confirmed your dream is more than chocolate fancy, set about testing your assumptions, and proving to people that this endeavor is worth investing in.

Justification

Now depending on your circumstances, justification will come in different forms. But essentially, you want to prove that this venture will satisfy customer success criteria, has a chance of success, will deliver value, and is affordable.

  • State your assumptions based on your customer need, then validate them. The Lean Startup gives great guidance on identifying and proving that your product is needed by your customers and will create value.
  • Write, test, and validate your business plan. Now, this looks nothing like the ones your bank or Business and Finance major told you to produce. Don’t use them, they will be out of date before the ink is dry. Instead, check out the Business Model Canvas. This is essentially a short form business plan that keeps your focus on your value proposition, your customers, revenue, and costs. Use it to validate if you have a business that will work.

    “I ignored this advice once and spent a long time writing a lengthy traditional 50 page business plan. It got me nowhere. All the assumptions I had made were unfounded, and all the projections I made couldn’t be validated. It was a painful and expensive experience that taught me to never do it again.”

  • If you’re in a mature business with portfolios of projects being delivered in a complex environment, then financial modeling may be necessary. If you must, do this only after you’ve proven the above.
  • Once you’ve built your MVP, there may be a case for creating a more traditional business plan. For example, if you have to go for funding or selection within your company’s portfolio of competing projects and resources. But this will be a business plan based on and informed by the tools used above. It will be lighter too.
  • In any case, use these tools as living, breathing artifacts. Use them as your guide and bellwether. They are never static. Refer to them and revise them as your project or business evolves.

Once you have your justification and all your stakeholders are onboard, you’ll be on fire.

The Feasibility phase is typically performed once in the life of your project. You may find you revisit the vision and feasibility of the project, especially if your data, customers, market or business indicate so. At the very least, they will be your guiding lights throughout.

Initiation

Awesome. The decision has been made, the project has the green light and you’re ready to build. Well, nearly. I know you’re thinking, “C’mon already, really? If we don’t do this now we never will. Let’s get this show on the road!”. But consider this - Agile is nothing if not about delivering value early and often whilst delighting your customers along the way. Taking some time to figure out the best way to deliver your project is the best-laid foundation for success.

The Team

In sport, by thinking about your favorite team game you’ll be able to recognize key roles that enable the team to perform as they do. Traditionally you’ll find a manager, a captain, and the rest of the squad. Outside of that, you’ll find coaches, physios, nutritionists, and an assortment of supporting staff. But if we look at the game of rugby, there’s a team within a team. The players that make up the scrum. This pack is made up of designated players whose job it is to win the ball back and continue play. When a scrum is in play, the players from each side then work, with no leader, as a single unit as collaboratively, communicatively, and efficiently as possible to get the ball back in possession. It is the game of rugby that inspired Jeff Sutherland to name his software development methodology, Scrum.

  • Scrum is not the only software development method in the Agile playbook. But it is the one that best describes the Agile concept and behaviors of working as a team, motivating individuals, creating trusting relationships, self-organization, servant-leadership, communication, transparency, and collaboration.
  • Your team will be formed largely by the circumstances you find yourself in. You may have developers available to you, some, none, or all of them may be familiar with Agile to varying degrees. You may want to hire a new team or partner with a 3rd party.
  • Other roles will be required too, but we’ll discuss those later.
  • It has been said that if you form your development team, then you’ve chosen your technology. As depending on where you bring your team together from, they’ll come with certain skill sets. So, think carefully how you form your development team and whether you need to perform a technical evaluation before you get to this point in your journey.
  • This brings us to cross-functional teams. Teams work best when they work together when individuals pitch in to get the job done regardless of their “title”. Try to build a team that is self-sufficient and individuals that take on more than one role.
  • Build an environment, culture, and relationship center. A place where the team can deliver, unencumbered by constraints or restrictions. Give the team the tools, people, resources, and space to be effective and performant.
  • Keep team sizes to no more than 7 or 8. If you have a need for many more developers, break the teams down. Each team might then be responsible for a given functional area. If you have multiple teams in multiple locations, consider holding a Scrum of Scrums. And where these are numerous in complex environments, use Agile project management.
  • Ensure that the team, business, stakeholders, and even customers have access to each other. Ensure they communicate and collaborate, and remove anything that gets in the way of progress. Daily communication is the best cure for project ailments. When people speak, they get stuff done.

Project Brief

In Feasibility, you figured out the “why” of your project and either built your confidence to forge ahead with your startup or got backing to proceed. The project brief is the living document that brings together the “why” with the “what” and “when” and “who”. It’s living, because as you progress from hence forward your knowledge, understanding, and path may change. To leave this document once written and never to return to it, just consign your thoughts to a point in time. In an Agile world, your point in time reference may change weekly or even daily early on, so it’s important to keep this fresh.

  • A great tool for encapsulating and maintaining your project brief is something that Jonathan Rasmusson calls the “Inception Deck” in his book “The Agile Samurai”. Here you’ll find great advice on ensuring that everybody that is interested in, affected by, or involved with your project is on the same page.
  • The greatest enemy to delivering projects is in having an unclear, inconsistent, or just plain different understanding of what the project is and what “requirements” are to be satisfied. If even one important stakeholder has a different understanding or view of what you’re doing, the consequences can be substantial.
  • A good project brief communicates:

    1. A common and agreed expectation between stakeholders and team members.
    2. An understanding of the project, with the same understanding across all parties.
    3. The goal, vision, objective, scope, and project context.
  • You’ll have a lot of good information for the brief gathered from Feasibility. The project brief will help you define and find the answers to searching questions. It will bring together stakeholders, your raison d’etre, high-level scope, risks, target solution, budget, timeline, expectations, and your priorities.

“A colleague stopped me in a corridor once and asked me where he could get the project brief for the project. I quipped ‘We don’t need a brief, we’re Agile’. He looked confused, as if he was questioning my sanity or authority. He was right to do so.”

Before you proceed, ensure you’ve got everybody on the same page, workshop it, ask the difficult questions, and nail it somewhere where people can stop, read it, comment on it, and help revise it.

Culture and Ways of Working

You know the way your business works and its culture, the way it likes to get stuff done. Agile, by its very nature, may challenge some of these ways of working that your business has cultivated over the years. Don’t expect Agile to be implemented and for everybody to lovingly adopt it from the outset. Some people may find it confusing and view it only with dread and fear. Some people may openly refuse to engage in it. These are challenges and perceptions you must overcome. But in your early days, don’t go around waving the Agile stick beating anyone that won’t listen to it. That won’t build trust, adoption, or engagement.

“I was a fan of waving big proverbial sticks once, and it earned me a lot of negative press. I turned it around, but not before suffering considerable pain first.”

As you set out on your path of adoption, tread carefully, respectfully, and with empathy. If you’re in a creaking old traditional business, perhaps it won’t be the best approach to get the whole business aligned. Start small and incrementally earn respect and recognition. Start with your team only. Once you start delivering quicker software with better quality than ever before, people will start to notice and will want to come play your game. When they do, offer them the ball, take them out for a coffee, and ease them into your new world. Help them.

With your team, now that they know what the project is about and your plans for Agile adoption agreed, let the team decide how they wish to behave and operate as a team.

  • Guide your team to identify the Agile concepts, techniques, behaviors, and frameworks that you feel fits your collective needs.
  • Take requests from your team members as to what requirements they have to help them perform as best they can. Some of these requests you’ll be able to resolve immediately. Others, you may need to get budget or outside help. Do what you can to make it happen.
  • These are your first steps to becoming a true servant-leader.
  • Consider organizing some appropriate training in the concepts and techniques your team are choosing to adopt. This is the best way to ensure all of your team, even stakeholders, are on the same page and get the same message. Work with a supplier organization that can tailor their offering to your needs.
  • Be prudent. Nobody will be an Agile ninja after a few days in a workshop learning how to become Agile. Your path will be long. The word “become” is quite defining. Only when you truly embrace Agile will you see its value. It should excite you. If it excites you, then go excite others too.
  • Now that your team has agreed with the concepts and techniques, had their wishes fulfilled and in Agile training, turn your team’s attention to themselves and what they expect from you, the business, and each other.
  • Define some Ways of Working (WoW) within and by the team helps build trust, relationship, and expectations. The WoW is no War and Peace. It should be short and to the point, between 7 and 10 bullet pointed sentences. These sentences state clearly how people behave, communicate, collaborate, support, deliver, and perform together. It should also state what the team to expect from the business.

Agile is as much a mindset as it is guiding principles and concepts. It helps you develop in the way you behave, think, negotiate, interact, communicate, perform, and improve. It relies on motivated individuals supporting each other to reach a common aim, together as one. There is an African proverb:

  "If you want to go quickly, go alone. If you want to go far, go together."

Enjoy the journey.

 

Now What Do We Do?

Editor's Note: Part 4 and final chapter of my undercover work at a big box retailer. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/


CONCLUSIONS
(NOTE: In my final report to the Regional VP of this big box company, much of what you have read in the previous three installments was contained in that report almost verbatim. This section, as well as the recommendations section, have been edited to protect the identity of the company.)

1. I neither saw nor heard any current vision beyond preserving profit while providing an excellent customer experience to its members, which, coincidentally, was the same vision that the founder drafted in the 1980's. As a result, the vision has become more akin to an annual operating plan rather than a long-term view to the future.

2. The graphical timeline for the company (since its inception to the present) demonstrates significant strides in member and profit growth, notoriety, and accolades from many different segments of the American business world, but these mainly occurred during the founder's lifetime. From his passing to the present - nearly 30 years - there are very few notable achievements or breakthroughs in their approach to retailing and customer service.

3. Also, all graphic and printed materials show photos of the founder as well as numerous quotes from him on what he was attempting to build for the future of the then fledgling chain in the 1980's. Almost 30 years later, the photos now look very dated (some are in black and white), and the motivational expressions are hackneyed and have been surpassed by more current and colloquial statements in today's business world.

4. Personnel policies, hiring practices, and orientation systems are out-of-date and will discourage highly qualified and potentially long-term employees from applying or staying long-term. The culture for its staff, as well as store management, feels both very parental and strictly hierarchal.

During the eight hours of classroom lecture style orientation, much of what I observed was focused on all of the negative behaviors and practices that employees should avoid during their shifts. These included thinly veiled warnings cautioning us against talking to union representatives (they are non-union), as well as how to watch for fellow employees attempting to steal from the company. There was only approximately 15 minutes out of eight hours spent on the subject of delivering excellent customer service.

A full hour was spent on what to do in an active shooter situation, including a very graphic 15-minute video showing us what that could look like, including the aftermath of a real situation. Led by the chief asset protection manager, this section of the orientation left me feeling like "big brother" would be watching my every move through a vast surveillance camera network within the stores, as well as him roaming the aisles and watching people.

5. Observing my fellow workers in both stores, I couldn't help but think that this retail chain had created a self-perpetuating universe of people that they hoped would stay and help to preserve the culture they inculcated every day. Now, within local store management, there were some exceptionally bright and highly educated people in pharmacy, optics, marketing, and other specialty areas, but I was left wondering why they stayed at this company when they could easily move to a better and higher paying work environment elsewhere? I overheard a wry observation from one of those managers that is revealing; "We have created a modern day version of a concentration camp where the inmates are also the guards."

INTERIM RECOMMENDATIONS
1. The company's impetus toward the future is primarily being driven by looking into the rear-view mirror at what worked well 30-40 years ago. A new and compelling vision is necessary for the company to stay relevant and possibly, even in business, considering the changing face of retailing coupled with a new generation that promises to make its shopping and purchasing decisions very differently than its forbearers.

2. If the culture and business model that I observed in two stores is uniformly applied around to all of its locations, then a major review of almost all six of its critical success factors will be necessary with the possible exception of supply chain management where it is close to being best in class in the "Big Middle of Retailing" arena.

3. A larger sampling of my work in its stores will be necessary to compile more data as well as to draw better conclusions to take into account regional differences across the USA.

Well, my report was well received by the person that had engaged me to do the work, but, armed with the geographically limited information I supplied, he is pondering what his next move will be to consider a change of course in the company's future. My final recommendation? I cautioned him against taking this report to the company CEO in its present form as it could be an instant career decision that might not have a positive outcome for him. Since the company is largely data-driven, more and wider sampling will be required to move the culture away from its previous celebrity CEO's foundation of doing business. We'll see.

Next Week: A look at a successful and happy company.

Be Careful What You Ask For.........You Might Get It!

"You Want the Truth? You Can't Handle the Truth!" (Jack Nicholson - 'A Few Good Men')

December 1, 2016

Editor's Note: Part 3 of my undercover work at a big box retailer. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/


The Report Card
Now that you are all experts in retailing, especially in the Big Box marketplace arena, here is a synopsis of the report I provided to management. If you grow weary of reading at this point, I can provide you with a "spoiler alert" preview of the bottom line - the final report was not well received by management!

Now, if you are still with me, let's take the success factors I outlined last week and let you take a look at them by the grade I gave each of them.

1. Store Factors - "C+" Let's face it; most big box stores are very dull in their interior accouterments. The two stores I studied, although 26 years apart in their construction, were no exception and, if anything, they were both very plain. The net result was that, if they are assuming that (a) people know what they want and (b) don't want to spend any more time than is necessary in this store, then they succeeded.

2. Service Factors - "D-" Here's where lack of employee engagement plays a significant role; I was told that annual employee surveys were done at each and every store in the chain and employee engagement always measured in the 85% range! This statistic was a big surprise to me as it ran contrary to what I experienced working there and to what Gallup Polls have found since 2000. Gallup's results show that 70% of American workers are disengaged from their work, while only 30% are fired up about what they do to make a living, and none of them work in a big box store. (The VP also quoted me a similarly high rating from the annual customer satisfaction surveys.)

I inquired about the methodology used to ascertain these remarkably positive results and was told that it was administered by the parent company through their website, and, while it was anonymous it had an incentive attached to it for employees filling it out and returning it (online). This was the same methodology used for accumulating customer satisfaction scores; in that case, it was part of every paper receipt that customers received that instructed them to go to the company website to complete a customer satisfaction survey and enter to win a cash prize.

I pointed out the two flaws in these approaches to gathering data. The first was, that, since the survey was sent to each employee by the parent company, then the issue of trust and confidentiality would be in question, and second, the cash incentive would also skew the results.

"Set the Wayback Machine, Sherman."
In the 1980's and into the 90's Reader's Digest and Publisher's Clearing House were enormously successful in selling lots of magazine subscriptions to people by offering them a chance to win anywhere from $10,000 to $1,000,000. And, by the way, if you wanted to order some magazines, too, then, by all means, do so, and, if you were the lucky winner, then Ed McMahon (of Tonight Show fame) could show up at your door with an oversized check for that amount for you!

Even though it was clearly stated in the rules that no purchase was necessary to win, every annual winner had bought some magazines and not a single person that ever won didn't buy any magazines. Several studies after the fact proved that people were strongly motivated to buy subscriptions and linked their probability of winning to those purchases. When asked why by pollsters, the most common response was that people assumed that, if they didn't buy anything, their entry was thrown into a "different pile" before the drawing.

Much the same as the above Reader's Digest example, employees would skew the results of the annual employee engagement survey by making positive statements about the company and their jobs to avoid being thrown into the "different pile" and potentially be under scrutiny for saying negative things about their workplace. For consumers, the same phenomenon would apply; if you said derogatory things about the company, then your entry would be tossed (away) into the "different pile."

(NOTE: Linking the above information to what I observed was very telling and at odds with the company's annual survey of employees and customers, to the point, insofar, that I had to wonder if the surveys were really about the company that I was studying!)

Checking a random sampling of review sites for customer satisfaction (ResellerRatings.com and ConsumerAffairs.com), I found that most customers gave this chain a 1 out of 5 stars for a rating, while Glassdoor (employee review of employers site), 2844 respondents gave them a 3 out of 5. When I pointed these disparities out to the VP, he questioned the validity of these results since they seemed so much in conflict with their surveys. To reinforce my position, I recounted the Reader's Digest and Publisher's Clearing House case histories above as well as the numerous lawsuits and restitution payments both corporations endured as a result of people, especially the elderly, that spent as much as $1000 (each!) on magazine subscriptions to bolster their chances of winning the grand prize.

At this point, he sighed and asked, "What else do you have for me?" My measured response came from my first-hand experience and put directly; I said slowly, "Nobody smiles." He looked puzzled for a moment as if to he was going to ask me what that had to do with anything, but I continued with a question; "Have you ever been a secret shopper at "XYZ" Big Box store (their largest competitor) or gone undercover in your stores?" He answered, "we have our own people that do that all of the time." I countered with, "it's not the same, you need to see and feel it yourself. Many of your competitors have staff that doesn't smile or provide excellent customer service, either, but, at your biggest one, they do."

3. Merchandise - "B" - Given this chain's demographic customer target, they are doing OK, but they are certainly not pushing any boundaries, opening avenues for attracting new customers, or trying to expand their niche in the "Big Middle" of retailing. I call it playing it safe, but, unfortunately for them, the world is changing, rapidly, and every day with their competitors taking risks and pushing retail boundaries. I inquired of the VP if they were planning for the newest and largest generation of shoppers (Millennials) ever to attract them to their stores. His response; "We're looking at it."

4. Price - "A" - For what they sell and the margins they sell them for, the price point is great! However, I suggested that their current overall strategy in how they were approaching the marketplace was not sustainable as a result of changing external factors. The risks they are facing are two-fold and interrelated:

  1. Their current profit margins were paper thin, and any changes outside of their control due to regulatory or market forces could sink them quickly.
  2. Labor costs have been held artificially low (with the use of federal and state subsidies), and with the advent of a new administration looking to cut entitlement programs at the federal level, a majority of their employees could find themselves unable to afford to work there. (I also reminded him that a new minimum wage hike had been recently voted into law in Colorado that could severely cut further into their margins.)

5. Technology - "C" - Many of their challenges could be mitigated with the appropriate use of current technology, such as #4 above. They could virtually eliminate checkout lines (and cashiers) with new checkout systems currently being used by many retailers. An app, supplied by the retailer to the shopper for an Android or Apple phone would allow a customer to checkout before they even reached the exit door. Popularly called, "Scan & Go," many of their competitors are already using them with great success. In this instance I was told, they were piloting this checkout approach in a sampling of their stores around the country (including one of "my" store's), but it would be years before it could be rolled out to all of their locations.

6. Supply Chain - "A-" - This was one area where they were almost excelling in the balancing act of controlling costs while providing an adequate inventory that customers both wanted and just in time. They have fully invested in RFID (Radio Frequency Identification) technology for the receiving end (pallets) of their business, and all personnel charged with stocking shelves were utilizing Android-based MC-40 mobile computers for accurate inventory management and replenishment. (Yet to be fully implemented, "smart labels" were missing, and UPC bar codes still dominate the landscape.) Even with this horsepower in information available to managers, I still wondered about the guiding strategy for human beings using these devices in making purchasing and stocking decisions.

Next Week: Now What Do We Do?

My Report to Management

Editor's Note: Last week, I wrote about the outline of my "undercover" work with a big box retailer. This week, Part 2 of the results of my report to management. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/
 

First, though, a little bit of theory.........

The Big Middle of Retailing

Wal-Mart, Sam's Club, Kohl’s, Lowe’s, Target, Costco, and Best Buy are typical examples of retailers in what's called the Big Middle (of the marketplace). Since the Big Middle is the source of the largest potential base of customers, it is where most successful retailers want to compete in the long-term, although it is possible to be successful in the short-term using a different approach. In fact, many of the retailers now in the Big Middle have gotten there by way of initially providing either an innovative offering or low price or both, thus providing superior value to customers. For example, Ann Taylor began by offering innovative products that provided customers with high levels of value through excellent benefits, whereas Target had its start by providing customers with elevated levels of value through low prices for high-quality goods using its operational excellence. Others, like Lowe’s home improvement stores, were innovative regarding their assortment and category dominant format, while also offering value through its ability to build partnerships with suppliers.


Big Middle retailers have succeeded in leveraging their innovative or low-price position to transform their niche appeal to the mass market. They own an entirely different position in the marketplace by offering innovative merchandise assortments regarding depth and breadth at reasonable prices. Apparently, they have successfully transformed themselves from being perceived as the innovative leaders or the low-price leaders into a hybrid of the two that appeals to a much larger customer base. They reposition themselves by transforming their image as either offering naturally innovative merchandise or low price to being retailers that provide great value in a broader array of merchandise.

Wal-Mart/Sam's Club faltered in their expansion strategy, starting in 2005. They underestimated the power of labor to influence local municipalities to enact “store size” laws, minimum wage laws, and health care benefits and they have also faced some lawsuits. Wal-Mart has responded in part by modifying their assortment, such as offering low price prescription drugs and expanded banking services. It has also finally realized its “one size fits all” mentality doesn’t actually fit all. As a result, they are customizing assortments to cater to urban areas and geographical and ethnic idiosyncrasies.

Once retailers move into the Big Middle, they cannot expect to rest on their laurels, or they will get in trouble and potentially be forced to exit retailing altogether. The Big Middle is a very competitive and profitable space. Other retailers are always vying for consumers’ attention and a place in the Big Middle. Simply being in the Big Middle is not sufficient for long-term viability. A case in point is conventional department stores. Once the darlings of Wall Street, they are now considered among the dinosaurs of retailing because they have not been able to sustain superior value through innovative offerings and high levels of service for the mass market.

Strategic Levers for Retail Success Through Value
1. Store Factors - A key strategic value driver at the store level is developing the right combination of format and retail environmental factors. Customers often look beyond the functional benefits of a physical store to the overall experience it offers, or, the store’s “look and feel.” Since much of the shopping experience is rather mundane, those retailers who can distinguish themselves with unique and exciting store atmospherics add value to the shopping experience. Some examples of innovative retailers that are migrating to or are in the Big Middle because they excel at store factors are Crate and Barrel, Starbucks, Japan’s Jomo gas stations, Bass Pro Shops Outdoor World, and American Girl.

2. Service Factors -  Given the time and effort that is invested by retailers to attract customers into their stores, it 's incredible how many retailers pay so little attention to customer service. It is common to visit a retail store and see half-filled shopping carts abandoned by shoppers who were tired of waiting for their turn at the check-out, or to see customers looking for a particular item they wanted to purchase but could not find a service provider to assist them in locating the item or provide the information they need to ensure it is the right thing. But those retailers who do provide excellent customer service distinguish themselves from their competitors, and therefore add significant value to their offering. Innovative retailers that are migrating to or are in the Big Middle because they excel at service factors are American Girl, Build- A-Bear, Trader Joe’s, Best Buy, The Container Store, and Lowe’s. Retailers that attend to certain aspects of customer service can contribute to customer perceptions of value, resulting in a robust and loyal competitive position.
 
3. Merchandise - Most retailers devote a tremendous amount of time and effort to merchandise management. Retailers who excel in merchandise management do so in one of two ways. First, they can concentrate on finding unique merchandise that appeals to their target customers. Second, they can be confident that enough merchandise is where the customer wants it when she wants it. Those who can do both, like Spain’s Zara or Sweden’s H&M, are even more likely to provide superior value for their customers. Innovative retailers that are migrating to or are in the Big Middle because they excel at merchandise management are Wal-Mart, Carrefour, METRO Group, Urban Outfitters, Trader Joe’s, Crate and Barrel, Starbucks, American Girl, Build-A-Bear, Target, Dollar General and other “extreme value” retailers.

4. Price - Price is a critical factor that consumers consider in ascertaining the overall value of a product or service. Understanding what the customer is being asked to give up in exchange for what they get is, therefore key to the ability of the retailer to deliver superior value. Marketers try to carefully determine the price of a good based on the value of what is being offered in the mind of the potential buyer. Retailers that are migrating to or are in the Big Middle because they excel at the pricing factor are Wal-Mart, Target, Carrefour, METRO Group, Trader Joe’s, Zara, H&M, Kohl’s, Lowe’s, Dollar General and other “extreme value” retailers.

5. Technology - The use of technology goes hand-in-hand with superior supply chain management. It is not surprising, therefore, that the same retailers who we believe are migrating to or are in the Big Middle because they excel at supply chain management also utilize superior technology.

These successful retailers use technology throughout their supply chain. Most retailers collect sales data at the point-of-sale. It is what is done with the data after it is collected that separates superior retailers from the rest. As noted previously, retailers can use sales data to work closely with their suppliers to plan production and inventory replenishment. Advanced systems like CPFR (collaboration, planning, forecasting, and replenishment) use the data to construct a replenishment forecast that is shared by the retailer and vendor before it is executed.

Some retailers, notably Wal-Mart and METRO Group, are using radio-frequency-identification (RFID) technology. (RFID tags—tiny computer chips that can automatically transmit to a special scanner all of the information about a container’s contents or about individual products.) If every item in a store is tagged, RFID technology can be used to locate mislaid products, to deter theft, and even offer customers personalized sales pitches through displays mounted in dressing rooms. Ultimately, tags and readers will replace bar codes and check out labor altogether.


6. Supply Chain -  In times of slow or no sales growth, rising expenses, and increased difficulty finding great locations, a managerial acumen toward supply chain management can generate significant profits straight to the bottom line. This involves efficiently and effectively integrating one’s suppliers, manufacturers, warehouses, stores, and transportation intermediaries into a seamless value chain so that merchandise is produced and distributed in the right quantities, to the right locations, and at the right time, in order to minimize system-wide costs, while satisfying the service levels required by its customers. Retailers that are migrating to or are in the Big Middle because they excel at supply chain management are Wal-Mart, METRO Group, 7-Eleven Stores in Japan, H&M and Zara.

Enough for today; next week, in Part 3, I give my letter grades to management.

Next Week: Be Careful What You Ask For.........You Might Get It!

This Strange Life We Lead

Editor's Note: I just finished a fascinating assignment. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/


The 2016 Presidential Election
I just wrapped up a rather offbeat assignment into the world of workplace culture. One of the best things that came out of this engagement was not necessarily the results, but, rather, the unintended consequences and their relationship to the recent Presidential election.

Big Box Retailing
I happened to meet a Senior Vice President for the Rocky Mountain Region of a big box retailer at a social function recently, and we started talking about workplace culture and its importance. I shared my experience in assisting businesses and organizations in creating the culture they wanted to create or change and my observations on same. He was intrigued and suggested we talk further during the following week.

We met at his office, and he expressed his concerns about how he felt that the company had "lost its way" and had become stagnant since its charismatic founder had died some years before. As we talked, I asked him how interested he really was in finding out the reason for this occurrence and shared that, in my experience, most of the ills that any business suffered from stemmed from leadership and rolled downhill from there. 

I proposed that we first perform a test sample of two stores in his region and that one would be the most recent one to open and the other to be the oldest, which turned out to be one that had opened in the past six months and the other had been in operation for 26 years. (One of the factors I was looking for was for was the impact of the founder on the most recently opened facility and the other that had opened during the founders tenure as the captain of the ship.) We landed on five success factors and planned to see if, upon the completion of my work, if these five elements would be replicable in further work with a broader sampling of stores in the future.

Here's How We Did It
To make this a truly blind study of these two stores, I suggested a methodology pioneered by anthropologists called a "participant observation study" to measure the culture through the five critical success factors. To do this, I would apply for jobs at these two facilities and go through the entire hiring process and, go to work for a brief time at each of the two locations, to which he agreed, and I got busy.

Getting Hired!
As a consultant since 1990, I haven't applied for a job since 1987, and it certainly was a strange process. Going through the company's website, I selected a few jobs that I thought I could do and demonstrate some experience for (the VP coached me a little on which jobs they had difficulty hiring for, too). Within 48 hours I received calls from both stores asking me to come in to interview for two different positions, in one store as a night restocker of merchandise and in the other as a sales floor assistant. Within 24 hours, I was offered positions at both locations and started the process of drug testing and criminal background checking, but neither references were asked for nor required. Following that, I accepted their offers after some negotiation on hourly pay and the first of two 8-hour orientations were scheduled for the next day at each store. (I also found it odd that there was no communication between the two stores in the same region that they had hired the same person twice!)

The Scarcity Mindset
The first alarm bells went off for me immediately during these almost identical orientation sessions which may go to a fundamental flaw in the company - the vision. When the first store in this chain opened in 1985, the quality of life in the workplace wasn't anywhere to be found in any business bibles or any M.B.A. curriculums. It was all about quantity back then, and many business leaders were only worshipping the almighty dollar in their approach. Virtually unknown in the US at that time, W. Edwards Deming's approach to business had made its most significant contribution in Japan's rebuilding post WW2.  In a nutshell, Deming's equation is:

    (a) When people and organizations focus primarily on quality,  then quality tends to increase and costs fall over time.


   (b) However, when people and organizations focus primarily on costs, costs tend to rise and quality declines over time.

It seems like the founder fell into the trap common in his time in the business world and solely focused on the bottom line, especially on the expense side. In fact, now an old joke, his motto could have been, "don't worry about the small margins, we'll make it up in volume."

Fast forward to November 2016 and I am looking at the results of the founder's vision, still very prevalent in all signage and quoted everywhere in print - "watch your expenses!" What worked in 1985 probably worked well then, but in the ensuing 30 years the world has changed and they have not. The entire 8-hour orientation (x 2 stores for me) was focused on saving money by eschewing overtime, being alert for shrinkage (theft), avoiding workplace accidents, avoiding seduction by union representatives, watchdogging fellow employees (associates) for signs of slacking, stealing time, merchandise, or money, and even a 30 minute segment on what to do in an "active shooter" scenario. Wow! There was nothing contained in the 8-hours of orientation focused on how to enhance the customer's experience except for 20 minutes of quoting the founder's advice on how to engage a customer when they first enter the store.

One of the most telling interludes was when the (2) Store Manager's addressed us during a 30 minute Q & A in each store. Although separated by 30 years in age and experience, their messages were essentially the same and felt like they were heavily scripted by the corporate entity. (NOTE: Looking around the room at my fellow inductees, I noticed "eye-rolls" and sly grins, so it wasn't just my perception.)

Following that sobering experience, we were assigned to take many hours of online education before we were allowed to start doing the job we had applied for, each curriculum somewhat unique depending on the position description. Fundamentally, the same theme followed throughout the online learning and testing protocol; scarcity, fear, and a pervasive feeling of parental supervision (from management) on everything we would do while on the job. The other tipoff for me how outdated the program was that the online learning curriculum was MS-DOS-based! (NOTE: Someone that works in one of the stores shared with me that the online learning curriculum hasn't changed in years even though he is required to renew his education annually.)

The People and the Culture
After ten days of interviewing and orientation, I finally was assigned someone to shadow and learn the ropes of each job in each store. Since labor is a significant piece of each store's budget, and everyone is still worshipping the founder's mantra, there are never enough people (expense, remember?) to do all of the work required to accomplish the tasks required. The pace was brisk, and people worked hard at their assigned functions because you couldn't leave from your shift until the planned work was completed. I asked my supervisor about overtime and was told that there was none! He said it all balanced out in the end because some days were lighter in the workload than others and he just had people stay home if they were approaching 40 hours. I mentioned that it sounded like that the remaining people would still have to work at a very rapid pace to get the job done and he just shrugged his shoulders and walked away.

Hillary or Donald?
Here is where I can bring in the relationship between this retailer and the recent Presidential election. The people I worked with were all splendid people and to a person, willing to jump in and help a fellow team member if they were falling behind, but not for the good of the store and its vision, mission or goals. They did it for each other. Much like you will hear from any combat veteran; they were willing to fight and die for their comrades, but not for the mission or the Army. In fact, a pervasive adversarial attitude toward management ran through all of the conversations during breaks and mealtimes; sometimes humorous, sometimes sarcastic and often laced with bitterness.

It will probably be no surprise for my readers that all of the people I encountered voted for Donald Trump. The people with which I worked were not very educated, well read, or even that interested in anything beyond their immediate needs, which was mainly centered around a scarcity mindset; i.e., "never enough."

They heard Donald Trump because he knew how to push their hot buttons and Hillary didn't. He was able to seem like he was one of them and she came across as too snooty, so they didn't believe her because they couldn't relate to her. When I challenged them on their opinions by offering that a billionaire was certainly not one of them and that he had a strong (bad) track record of business failures, racist and anti-women attitudes, one of them replied, "And your point is?" A more intelligent response, "But Hillary is a crook" seemed to outweigh anything Trump had said or done. I now believe all of the post-mortems that I have read that say that Hillary was out of touch with a good chunk of the real America.

Next Week: My Report to Management

"Lead Me, Follow Me or Get Out of My Way!"

Editor's Note: One of my pet peeves and a quality that I search for but rarely find. Read on and enjoy. As always, you can find all my blog posts from 2013 to the present on my website at http://stevemarshallassociates.com/steves-blog/


Who Said That?
Variously attributed to Thomas Paine, George Patton, and more recently, Ted Turner and Lee Iaccoca, no one, including Saint Google, is sure who actually said it. I think that it is an enduring sentiment and one that is hard to find in America today. The following article by Mark Suster sums it up quite nicely.

Lead!

It’s hard to be a real leader. Decisions are never black or white, so most people fudge. The straddle middle grounds to keep everybody happy. They make compromises to try and hold together constituencies. On business decisions, they want to hedge their bets so they do a little bit of everything but nothing extremely well.

As highlighted by Brad Garlinghouse years ago in the famous “peanut butter manifesto”— it’s like spreading peanut butter evenly over a piece of bread. And of course fudging never produces world-class results, so many companies suffer from mediocrity.

The problem with hard decisions is that you can never make everybody happy. There is always somebody impacted or somebody who thought “plan B” was better. Leadership is about listening to multiple opinions but in the end trusting your instincts and deciding. Leadership is about not worrying about how people will think about you for hard calls. It is about being willing to be wrong. Leadership, as I’ve pointed out before, is about being respected more than loved.

As somebody fortunate enough to spend time with senior people from our tech and investment sectors I can tell you that even at the upper echelons people struggle to make hard decisions and the people willing to forge difficult paths are few and far between.

It was not a popular decision at all when Steve Jobs chose to open retail stores. People laughed at Google buying YouTube for $1.65 billion. Evan Spiegel was thought an idiot for not selling Snapchat for $3 billion. Netflix was widely criticized for breaking their business in two.

Leaders have well-formed opinions that go against the grain, the temerity to sell their vision to skeptics, the tenacity to stick to their ideas when they are inevitably criticized, the resiliency to wake every day when they’re being kicked by everybody for their beliefs but also the willingness to look at data and re-chart their course when they got it wrong.

Leaders need to be early, have conviction, be persuasive and get others to follow when rational people should not. And trust me, the world is FILLED with naysayers. Whether they succeed or not does not defeat their leadership and willingness to try.

Follow!

There truly aren’t many leaders, it’s a thankless and stressful job. And leaders aren’t always right and even when they are they don’t always win. And while leaders set direction, of course, it is teams that deliver results. The leader can only point and recruit world-class people but the results are owed to the team.

In every team, you need the majority of people who excel at their job functions. They are great within their respective fields whether they be marketing, sales, programming, PR, whatever. People running these job functions are also leaders — don’t get me wrong — on each team, you still need leaders & followers. You simply can’t have a team of people all pulling in different directions and death by a thousand cuts is having multiple departments all moving in their own direction.

While the overall leader must set the direction of the top, the goal is each department must be to align the objectives of that group with the overall goals of the organization. When done well companies have a system like OKRs (objectives and key results) or V2MOM (vision, values, methods, obstacles, measures).

If an organization and its people won’t align themselves with the direction from the top you will also end up with mediocrity. Only aligned organizations excel.

Get the Hell Out of My Way!

Dissent is fine. Dissent actually makes groups stronger. I love being challenged because it forces me to think harder about what my convictions are. I love when people come with ideas that conflict with my world view because the conflict either ends up giving me more confidence in my convictions or helps me to evolve. Sometimes it even causes me to consider revolution.

But dissenters need ideas of their own. Dissenters need facts and logic. Dissenters need to be willing to roll up their sleeves and help do the work. Dissenters need to be willing to have their own necks on the chopping block and admit that they were wrong in the end.

Dissenters don’t get to be “back benchers.” They don’t get to yell from the peanut gallery but never own results or the consequences of decisions. Dissenters don’t get to second-guess but never lead.

Throughout life, I’ve realized that many people are back benchers. “That will never work” is their motto. They like to criticize but they don’t have strong ideas of their own. They “know” what’s wrong but they never do anything about it. They never lead. Yet they don’t follow.

When you spot people like that in your company you have no choice but to part ways with them. If you wake up one day in any organization and you realize that you’re no longer “part of the solution” it’s time to get the hell out of the way. This is especially true when you’re senior and too many people are looking at how you react to change or when your disbelief undermines the confidence of others.

When you get the hell out of the way you either find out that the other leaders were right or you get the chance from the outside to later say they were wrong. But either way, you at least let your organization have cohesion in the plan.

And if you can’t lead, follow or get the hell out of the way — have the decency to move on to another organization.


Next Week: This Strange Life We Lead