Is your WORK interfering with your JOB?

So, what’s the difference?

First, thanks to longtime reader and friend, Harley Kaufman, for the thought and title for this insight.  He stated, “Too often it seemed our internal staff was more focused on getting the ‘work’ (daily tasks) done and not enough on the ‘job’ (supporting subordinates with resources and encouragement.)”

Wait. Had I been guilty?

Of course, this comment made me think of the many times I had been guilty of this more than occasional heads-down office work over the years of management and assume that most of you who have supervised others have fallen into the same trap.  I recall one of my CEO’s when I was his chairman, stating, “If you are not serving our customers, then you should be supporting those who do”.   Is that statement a bit of a stretch for those in the lowest levels of office work, such as posting accounts payable invoices?  Maybe not.

How do you frame menial desk jobs as “customer support?”

[Email readers, continue here…]   Even the most menial of jobs fit into the grand scheme of customer support.  Some accounts payable invoices come from suppliers providing the company resources to serve the customer.  Moreover, most managers of all groups work to make the company better at servicing the sales staff, the customer support group, or the customer directly.   So, it would be easier to see why you’d want to get behind the rallying cry from that CEO who focused his staff upon the customer – and the company’s mission – which surely incorporated the customer in the first sentence.

Shout it out! 

Harley went further by hanging a banner on the wall of the office with the headline to this insight in bold, large type.  He made it clear that this wasn’t just another sentence in a mission statement to be read by a few and immediately forgotten.

Let’s take this thought one step further. 

If you manage even one other person, are you guilty of focusing upon your deskwork a bit too often when you could have been coaching, supporting, and asking generating questions of your subordinate(s)?

Generative questions?

“What problems are you working with where you could use resources or help?” “Where is your bottleneck, preventing you from doing your job most efficiently?”  “How can I help you succeed today and in the longer run?”  “What if you had more resources, how would you use them to better serve our customers?”  “What do you see happening that we could do better?”

Generative questions such as these make people think and respond in ways they might not have considered.  That’s much better than “How’re you doing today?” to which most people would respond, “Fine” and which would usually end the conversation without generating any positive or negative response or thought.

So, with these thoughts and questions aimed at you, are you a manager who uses generative questions to elicit thoughtful conversations?   If not, consider how you can better support your customers directly or by supporting your direct reports.

Be a better manager of people. Don’t let your work interfere with your job.

 

Posted in Depending upon others, Surrounding yourself with talent | 1 Comment

Simplify your commission structure. Please.

Is your commission structure so complex that even you must have help understanding it – and calculating a commission on a pending bid?

Salespeople are incentivized by the money.  Of course.

They usually can calculate what’s in it for them before they make the final presentation and ask for the order. But what if the commission plan is so complex that even the people who should be most excited cannot understand or calculate the winning numbers?

Many rules or few?

Far too often, I come across companies with commission structures that take into account “all” the possible permutations of profit on a sale, causing everyone to wait for an accounting person to complete a cost analysis in order to find the magic number, or for a manager to rule on percentage splits for territories or products.

Here are some solutions.

[Email readers, continue here…]   For those who have tried (and perhaps built) a commission structure based upon anything other than gross revenue, there are some relatively easy solutions for simplification.

First, forget the extremes in cost of goods or labor costs for the sake of ease in calculation – and for more effective motivation for the sales staff.  Pick a number for the cost of sales for outside purchases of hardware or services and assign a standard percentage to these.  For example, make all outside hardware and services commission calculated at 25% of the contract sales price, and all inside services commissioned at 50% of the billed amount (as a basis of that line item for the percentage to the salesperson.)

Exceptions to the rule?

Then make a rule that exceptions for commission calculations can be made only for contracts above some large trigger amount.  Codify that the salesperson cannot discount lower than some percentage of the stated prices, usually ten percent, without management approval – and possible commission percentage impact.

For SaaS or other contracted recurring revenue, the commission should be calculated in advance for some stated number of contract months.  Cancelled contracts would result in a chargeback against pre–calculated commissions and charged against future earnings.

Pay upon cash or contract?

Many smaller companies pay commissions as cash is received.  This complicates the accounting process, but importantly not the incentive to the salespeople, who have long since been able to calculate the total commission on the order and look to the extended payments as a form of deferred revenue, not as a penalty.

Company executives have come up with permutations for protection of cash flow or profitability since the dawn of commission time.  But we can address the motivation and resulting follow–though by salespeople as a result of these many types of permutations.

And simplification almost always leads to better sales efficiency, motivation, and more closings by those who now understand their portion of the profit from their work.

Posted in Growth!, Surrounding yourself with talent | Leave a comment

Are we managing like JERKS?

Are we who issue orders to associates or employees ever acting as jerks?  We’d never like to think so, or we wouldn’t do it in the first place.

Here’s a clue…

If someone is saying “This is confusing to me” when you’ve given an instruction or order, there are several ways to respond.  Of course, it may be appropriate to explain your reasoning, or ask what part of the instruction is confusing.

But, as one CEO pointed out to me recently, it may be more appropriate to ask yourself if the instruction was necessary or worth the effort in the first place.  He worded it a bit differently, as in the headline to this insight.

It sure gets your attention. 

Managers can be jerks as easily as anyone with a bit of power misused or misdirected.

So here is the simple test. 

[Email readers, continue here…]   Before issuing any kind of order to perform a task, think of how this might be interpreted by the person receiving the order.  Take the cynical view – the worst-case possibility.  Because it’s a guarantee that many of those on the receiving end will do just that.

Did your proposed order pass the jerk test? 

Will the requested outcome advance any of your goals – or just provide an increment of satisfaction?  Will the output be used in a meaningful way?  Or will this just be another reason for that cynical associate or employee to label you with that term?

Now raise the stakes of that order to the corporate level.  Will a whole department or all those under the level of the issuer feel a bit of the jerk syndrome?

Well, then. You have a tool for the question. And you know how to use it.  Think back to your past.  Ever think that of an action by a leader in your past life?

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Hire on ability. Fire on fit.

This is not necessarily the way we intend to behave as managers, but our headline reflects the reality of most experiences when viewed in retrospect.

Don’t we most often hire based on experience?

We carefully vet the potential hire for experience required.  Ninety days or longer later, if

that person is terminated by management, it often is for actions resulting from the person’s relationship with others in the organization more often than failure to perform the specific task for which the person was hired.  Especially in companies with unusually stifling cultures allowing few errors or deviations from the handbook or rules, some new employees just cannot adapt.

We have a 90-day trial to test this.

Yet, we hired the person based upon our perception of the ability to do the job designated. And yes, some of those hires can be vetted on the job and found unable to perform to standard, deserve a negative review and possible termination within the first ninety days of hire for that reason alone.

When experience meets cultural fit

[Email readers, continue here…]   But experience tells us that more often the person just didn’t fit in, a reference as much to the culture of the enterprise as to the efforts of the new hire.  Should we be so abrupt as to consider letting someone go based upon their lack of a good fit within the organization?

…and the point of this is…

My experience is that it is better for both the new hire and the company to make the

termination decision quickly, humanely, and within the first ninety days of hire.   The shock to the employee, to the culture, to the corporate pocketbook, and to legal challenge is much less than when the process is extended again and again to find the right fit for someone who is just not quite right.  And if that person is visibly or vocally unhappy, the problem becomes toxic and even more dangerous to the culture of the organization.

Protecting ourselves and the employee

Firing on fit is an important rule to consider when examining the early work of a new hire – within the first ninety days.  For the sake of protection, there should be at least several coaching sessions and a documentation of these sessions in the employee record.  But the ninety–day rule is reasonably common across government jurisdictions to protect employers when making early termination decisions.

Everyone hates to let someone go.  It’s one of the hardest things a manager does.  But it is important to protect the corporation and help the new hire to move on – when warranted.

Posted in Depending upon others, Protecting the business, Surrounding yourself with talent | 4 Comments

Would you celebrate your mistakes?

Leading by example

How do you teach your work force that mistakes are OK as long as they learn and don’t repeat them?  By being a visible example.  A friend and fellow CEO states that he publishes each of his mistakes in his company internal blog along with the lesson he learned.  “If the CEO can do this, he gives permission for anyone to confess as well,” he states.

Think of aviation lessons for safety’s sake

You may not know it but the National Transportation Safety Board has for years offered a reporting program for pilots, air controllers and others involved in aviation safety.  Anyone reporting an accidental safety error (such as flying into restricted airspace) within ten days is granted immunity from FAA prosecution, as long as the mistake was not an intentional breaking of the law.  Even NTSB understands that mistakes are learning experiences as it insulates accidental infractions from prosecution in order to learn and solve problems communally.

What is your culture?

Do you respond to an employee mistake with a warning or even punishment?  If so, it is a sure thing that fear will cause your employees to hide them, cover them up with quick fixes if possible and worry over the consequence of creativity efforts or of pushing the envelope a bit.

So, here’s your question of the week:

[Email readers, continue here…]   Doesn’t the whole enterprise fail a bit each time a learning opportunity is lost or someone hides actions from management?  And what does it say about your corporate culture and your individual management style?  Even if you condone the overreaction of others in management, aren’t you then guilty of reinforcing such a culture of punishment over learning?

Celebrate your mistakes.  Others will follow.

All will learn to share for the sake of safety, growth and open culture.

Posted in Depending upon others, Surrounding yourself with talent | 1 Comment

Learn processes from your employees at work

Empathy comes from experience.

Over fifty years ago, I was CEO of a record manufacturing company in Hollywood.  We were the only such facility on the West coast to provide and control the entire process from studio, through finished vinyl record pressings in the same building, therefore able to promise quality control others could only dream about.

The “clean” work in the front office

As founder and CEO of the then public company, I was expert in several of the “clean” processes such as studio recording, record mastering, cover design and photo lithography.  But if I knew then what I know now, I would have spent time working with my employees in each of the subsequent and more mechanical processes such as printing press management, record press management and shipping control to better learn my own business and hear first–hand suggestions from the line.

I lost an invaluable opportunity to learn from the front line.

Later, as CEO of a fast-growing computer software company with over thirty employees in customer service alone, I did learn the lesson, as I sat in on customer service calls on occasion to get a more complete understanding of the process, pressures and opportunities for improvement.  Then, when my manager of customer service sent a request up the line asking for funds for equipment or expanded staffing, I would understand the need, sometimes offering suggestions for improvement to try before making the investment.

[Email readers, continue here…]   

My conclusion is your challenge:

It had taken years to learn that empathy comes from experience, not just perceived understanding.  And that there is such a thing as a business leader showing empathy while making good strategic decisions.  I learned that employees appreciate knowing that their executives have experienced and can understand their world.  I learned that tough decisions, such as denial of a request, are better received when all affected know that there was a deeper understanding of the issue and reasons for the response.

All because I learned to sit in and understand the position, the workflow, and the challenges at each stage in the process of customer service.

Are you too busy to learn each step along the corporate process enough to understand issues and challenges?  Start by sitting in with some of your employees in the tough jobs alien to you.  The benefits are immense.

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Careful with terminations. Don’t disparage.

It happens all the time when you’re a CEO or manager. 

Somebody important leaves or is let go, and you worry over the impact upon remaining employees and customers.  You worry that the person leaving will begin to unload all the pent–up garbage from the past, perhaps damaging the company and causing customer defections and even employee unrest.

Your worry is real. 

It is human nature for those remaining to blame the departed employee for any sort of sins from the past, real or imagined.  And it is human nature for the person now free of the company to attempt to explain why the departure – in the most flattering personal terms possible.

But in my experience, many of these ungracious outbursts lead to anger, threats and reprisals – all unhealthy for both the individual and the company.

A suggested tact for you from experience.

I was able to mute these on both sides in my past life with two simple efforts of outreach.  I’d call in the departing employee, even those with the worst violations “for cause,” and offer an unemotional exit interview asking for their thoughts about their experience – no holds barred. Then, I’d remind each that it is more than just possible that someday we’d meet again, perhaps as supplier–customer, customer–supplier, industry resource or friendly competitor.  Therefore, we should make a genuine pact:  neither of us should give in to temptations to disparage the other no matter what the personal psychic gain.  Shaking hands after such a promise sealed the deal, even with those you’d rather never see again.

[ Email readers, continue here…]    And it worked with great effect. 

Even today, many years later, former employees who departed during my tenure, find me at trade shows and other industry events, telling me that their experience with us was the best they’d ever had with any employer.

The second thing was just as important.  With the person leaving (for whatever reason) in tow, I’d show up in that person’s department, call a quick meeting, and make the same statement about non–disparagement to those present, addressing their natural inclination to later blame as part of the short talk.  When warranted, a quick celebration including the department employees sealed the deal.

Then there is the formality of codifying this. 

Every termination should be accompanied by a termination agreement or release before final payment. It should contain terms of separation, reminder of confidentiality, and a non–disparagement clause.  It’s a contractual reminder that can be used if needed.  Using the techniques above, I don’t recall ever having to do so.  May you be as lucky in your efforts.

Posted in Depending upon others, Protecting the business | Leave a comment

Finding a strategic partner, investor or buyer

Get organized.

Finding your strategic partner, investor or business buyer is not something you do haphazardly.  There are many steps to take, each closer to assuring a success.  Research is paramount, and sources are everywhere, especially for public companies and large investment firms.

Start with the “matrix method.”

You and your advisors, board or partners should start by completing what you can of the matrix shown on this page.  It will help you to focus upon the most likely candidates and save lots of time.  Here are the steps to take.

Find up to ten likely candidates that fit your business.

You can list companies you know, have contacts within, or that fit your industry segment.  Think of those who might need what you have to offer.  In fact, that leads to the most important part of this process.

Examine the four columns in the matrix.

[Email readers, continue here.]  Column one is your list of your candidates in no particular order, usually the result of a brainstorming session where you participate or lead.  For corporate boards, even those not looking for a buyer at this time, I often help to manage this exercise in board meetings once every few years. It keeps the board and CEO focused upon an ultimate exit.  That’s important when you’ve taken money from investors and have outside shareholders.  When taking their money, you made a promise to “make them liquid” someday, not to build a lifestyle business where they would be trapped forever, unable to see a return on their investment.

Column two is the golden ticket.

“What would the candidate want from your company in a transaction?”  Think carefully.  Some potential buyers or strategic partners might want your intellectual property, or revenues, or profitability, geographic advantage, or sale force, or your employee base.  Select the most likely reason you’d find if you could “get into their heads” and see what they might value most.  We’ll come back to this column in a moment.

Column three is important for you and your stakeholders.

Here you state in a few words what your company would want for the candidate – other than cash or investment which seems obvious.  Your definition of a great fit might include their distribution capability, their brand, dominance in your field, their sales force, their access to growth capital or more.

Column four is the easiest but also important.

Here, on a scale of 10 to 1, is your best guess of the likelihood of making a favorable deal with the candidate.  A 10 means that you are absolutely sure there is a need and a fit and the ability of the candidate to pay in a range you anticipate.  A 1 is tantamount to a complete waste of time.

Now return to column two.

You will surely notice that a majority of your estimates of the candidate’s interest or needs are the same, one to another.  This may surprise you and the team because this is your (sometimes hidden) core competency as others see you.  A wise board and management would take their own hint and strengthen that core, whether it is your development team, your geographic dominance or other trait.  And strengthen that at the expense of other areas of your enterprise which may easily be outsourced or reduced in scope.

The net result of this exercise.

You will have focused upon your real value, identified a list of companies with executives you need to know soon, even if long before any suggestion of a transaction.  Even a five-minute introductory call to the CEO with no agenda works for later name recognition.  And the exercise of researching through search engines, friends, financial sites or trade publications will begin to help you develop a picture of each candidate’s needs and strengths.

This exercise is time well spent and should pay back in multiple ways in your future if not immediately.

 

Posted in Finding your ideal niche, Positioning, Raising money, The liquidity event and beyond | 1 Comment

Is ‘servant leadership’ too soft for you?

First, what is “servant leadership?”

It’s a term rooted in ancient philosophy.  Robert Greenleaf may have been the first to resurrect the concept in his book published in 1970.  Not quite as bold as inverting the management triangle, the concept of servant leadership requires that a business manager focus upon his or her people’s highest priority needs first.  

So, what’s the question?

The question begged by the headline above is whether this form of leadership is perceived as soft, indecisive, and inappropriate for the fast–moving world of today’s business.

How do you classify this style of leadership?

A servant leader uses a participative style of management, as opposed to one that is autocratic or (at the opposite end of the spectrum) laissez–faire.  More important, a servant leader involves employees in the process of decision–making, focusing upon the performance and satisfaction of employees.

Doesn’t sound tough or forceful enough for you? 

[Email readers, continue here…]    You are not alone.  It is a very thin line between abdication of responsibility and participative leadership.  The world loves bold leadership.  Steve Jobs, who was known to be in charge of each detail in design.  Elon Musk, who obsesses with metrics and constantly asks for employees to feed him their concerns but makes bold moves on his own.

How about tech businesses or remote workforces?

In technology–based enterprises, the question of leadership vision becomes mixed with leadership style.  Can a visionary leader abdicate the execution of that vision by subordinating to those who carry out the execution of that vision?  Or must he or she be more like Jobs or Musk and stand in the center of the storm, constantly testing the execution efforts of those around?  And how about the leader working with his or her remote workforce?

There is a place for a leader as servant. 

But the perception of that leader being soft and lacking in strong leadership traits is the sure result of using this method as the leading style for a CEO.   It is fine as a secondary style used in tactical decision–making, when strategic issues are not the focus, and where threats to corporate health or resources are not evident.

But those leaders who will be remembered as having changed the world, even if the world is defined as within the walls of one enterprise, are those who were clear in their ability to communicate urgency, quality and focus upon the customer – not necessarily those who delegated the best or allowed decisions to flow from management concurrence.

Posted in Depending upon others, Surrounding yourself with talent | 4 Comments

Is “management by walking around” an outmoded fad?

Let’s set the scene.

One of the CEOs I used to coach started his day by walking the floor of his extended facility and checking in with managers and employees of the various departments, especially the call center.  He tried to feel the pulse of the company by the intensity of motion, the metrics of backlog, and the stated problems brought to him as he asked

…and ask this question:

Was he a relic of bygone times, when employees worked in a single facility, managed directly by people who could see and speak to them in person?   In this age of remote workforces, self–managed contractors and employees, outsourced call centers and development, is this a dying art?

And does the presence of a caring CEO taking the time to check in personally change anything after the waves of his or her presence pass in the calm of departure?

Well, yes.

Everyone knows when the CEO or senior manager stays in their personal office – or nowadays doesn’t come into work when others make the effort – especially when closing the door, that “something must be wrong” or “the person doesn’t care enough” or “what does he or she do all day?”   The facts seem to show that younger employees, under 30, want to be personally present to be visible to management. What if management, usually older, cares less about being regular at the office?

Let’s use the “C” word (“culture.”)

[Email readers, continue here…]   It is more than showing the flag when a manager or CEO spends time focusing upon the immediate issues of subordinates and offers resources to solve problems without the need for formal meetings or Zoom calls.  It is a mark of corporate culture when everyone knows that those above are serving them in very visible ways by taking the time to be present, and to hear and react.

But there is something more.

A good manager can feel the mood and the level of business activity, but not easily from behind a desk or on the other end of a phone or Zoom call.

It is one of the reasons that senior managers who travel to the workplace from afar and show their presence only several days each week are not as effective as companies grow and span of control increases.

Does management by walking around still work? 

Is it as valuable as it once was before our communications systems became so complex and varied and well defined?

Yes.  Yes. And yes.

Posted in Depending upon others, Protecting the business, Surrounding yourself with talent | 3 Comments