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Engaged employees perform best.

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Gallup Organization has been looking at employee engagement for many years. They’ve famously found that only a small percentage of our workforce is actively engaged at their jobs. Often, company discussions about people policies center around employee well-being as an underlying principle driving HR policies. Wellbeing refers to perqs like vacation time, flextime, and so on.

I just read this Gallup research summary that asks: Should a company put effort into employee wellbeing policies, or into employment engagement policies? It turns out to be easy to answer: the greatest driver of wellbeing is employee engagement, not perqs. The research shows that engaged employees perform far better than non-engaged employees, even if those non-engaged employees are given a lot of workplace perqs (e.g. more vacation time, etc.).

Also interesting, though not mentioned in the conclusion, is that flextime is also tremendously important. Having engaged employees and giving them flextime gives the greatest boost to wellbeing.

I know when I’m engaged, my whole life seems better. Next time you’re wondering how to improve workplace morale, instead ask how you can help improve engagement. That answer might change your entire culture.

Internet: mass manipulation tool?

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I’m downloading Trust Me, I’m Lying by Ryan Holiday, about media manipulation on the internet, at the recommendation of a professional journalist friend.

As I read a few of Ryan’s blog articles and PR interviews from the book, I’m struck by how much his experience matches mine. Though I’ve not tried the kind of conscious manipulation he describes, I’ve seen it all over the place and noticed the same lack of basic fact checking in various stories I’ve been involved in.

My most striking example of this was several years ago when a Fortune 500 company revealed to me how easy it is for them to engage in mass manipulation now that the blogosphere lets them leak stories from different sources and have it all build to appear to be a preponderance of independent evidence.

Another Ryan, the amazing and awesome Ryan Allis (founder of iContact, uber-optimist, and serial entrepreneur) and I spoke about this over dinner a few weeks ago. His view is that the internet has evolved to the point where the truth will come out, despite attempts at manipulation. Especially with the rise of social media, manipulation doesn’t stand a chance because the truth will get out via informal networks.

What do you think?

An apology: 8 Secrets of Success

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In my post about Richard St. John’s TED talk, I critiqued his research methodology and spent the entire post pointing out flaws. I was wrong. He has since contacted me and pointed out that my assumptions about his research were incorrect. Indeed, he did his research correctly. I did not do mine correctly.

If you check out the post on Eight Secrets of Success, my points still hold for a significant amount of the success literature out there in the world. But not Richard’s. His research was solid and I apologize sincerely for assuming otherwise.

Perhaps we’ve found a ninth law of success: research!

Customer acquisition via poor service

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I’m curious. I’ve noticed some web sites, stores, etc. try to gain or retain customers by providing bad service. They hide their prices so you have to start the purchase process to discover pricing (just try finding out how much it costs to make 10 color copies at Fedex/Kinkos. I dare you.). Some web sites don’t have a cancel-my-membership button that’s easy to find and don’t give a customer service number. I’ve had magazines ask that I cancel my subscription in writing.

Do these tactics work? Hiding prices makes me less likely to use a site. Making membership hard to cancel doesn’t stop me from canceling, but it DOES convince me never to come back if I was canceling for a reason that might have been temporary.

How about you? Do you find these things actually work on you, or do you rebel against them? Or do you not even notice?

Venture Moments of Truth

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As ventures grow and develop, the challenges they present change. Often change is sudden rather than gradual. These sudden changes require a shift in the way the company and/or the top managers do business. These are times when coaching can be most valuable.

The one-room shop. In a one-room company, even if the room is a 60-person room, communication is informal and universal. Roles can be amorphous, with anyone pitching in to help with whatever needs doing.

The first hire. With your first employee, you become a manager. Decisions must now be made taking the employee into account. Confidentiality and access to information get raised as issues. Delegation, clear communication, evaluating, and motivating your employee become necessary skills.

The first firing. It happens. And it isn’t pleasant. It also sends a strong message to everyone who is left. With the first firing, everyone will realize—really realize—that you are the boss. Handling the dismissal, handling your reactions to the dismissal, and managing perceptions of the remaining employees become the challenges.

The first customer. The market is now aware of you. You have your first chance to collect real customer feedback. The length and cost of the sales cycle becomes apparent. Your cash flow requirements become more knowable, and the strategy/tactics need to respond. And for the first time, you have to deliver on your promises.

The first lost sale. You have to grapple with whether your product should be changed to meet the market, or whether you just had a bad fit between your product and that one prospect. You may find yourself dealing with how to react appropriately, and how not to take this personally.

The two-room shop. Communication that happened through proximity and casual conversation suddenly stops happening. For the first time, you must explicitly identify communication paths and determine how they will operate. Things that have always worked in the past may not work any longer. You’ll grapple with identifying solutions and separating accountability of the system from accountability of the people.

The first fight. There comes a time when, despite the best of intentions, the founders disagree. Really disagree. This is a time to examine the relationship, and make sure you have a structure for working through conflict.

Money runs out. When the money almost runs out, the venture capitalists and other funding sources may hold your feet to the fire, just because they can. You will encounter issues around negotiating, personal balance, and separating your identity from the business to create as objective an action plan as possible.

Cash flow positive. Survival no longer depends on every cash decision! You can invest surplus in longer term projects. Cultures which have been compromised to save money now have the option of improving their business practices. “Spend as little as possible” was your old imperative. Now, you need a way to decide how to use the surplus cash. Culturally, you have an opportunity to increase integrity in how business is conducted.

Once you have cash, how you pick and choose opportunities to pursue becomes less dependent on pleasing outsiders. You are self-funding and have the option of slowing growth to avoid the need for new outside capital.

The Chaos Point. When the company gets too big for one person to keep on top of everything, chaos can ensue. Organization structure becomes necessary, and managers must shift from getting things done to creating an organization in which others can get things done. Delegation, willingness to give up control, learning to guide and create culture, setting compensation systems, building meaningful feedback systems, and hiring all become critical capabilities.

Outside money. With outside money, you are truly accountable to others. Board meetings take preparation, and the outside money may bring restrictions and new constraints. The personal challenges include balancing your own vision and plans with those of the outsiders. Changes in strategic direction may become dependent on outside approval.

The second Chaos Point. Somewhere between 70 and 100 employees, real business systems become necessary. The numbers just get too big: too many job applicants in the pipeline, too many projects to track, too many purchasing requests, etc. Few employees have the business process analysis skills to put systems in place. Those few who have the skills become overwhelmed as everything important is given to them: “Just this once? You’re the only person who gets things done around here.” Building business systems and training underlings in building systems becomes imperative.

Multiple product lines. Once you move to multiple product lines, issues start to arise around your company’s identity: what do you stand for? Who do you serve? If one line is more profitable than the other, are the managers or salespeople paid differently? Are you a single brand? Multiple brands? Issues of focus, resource allocation, balancing the culture, and accountability become important.

Acquisition. When you’re acquired, the challenges revolve around keeping good people, merging your identity, culture, and product lines with your new parent, and defining roles and career paths that work in the new entity.

IPO: the finish line? As rumors of an IPO begin to spread, comparisons start. Who has how much? Whose options are worth what? Will we be as rich as our friends at e-commerce.com? Suddenly, you are legally required to keep a lot confidential from your employees. Issues of fairness, ethics, trust, and reporting requirements arise within the company. The issues are huge: six-figure tax planning, psychological preparations to become rich (it’s not as easy a transition as most people think), learning to make decisions from a large asset base, examining how priorities change, understanding how to manage friends and family, dealing with the public speaking and stress of a road show, and keeping the company together while all this is happening.

Life goes on…publicly. Whoops. The company iPod and you just realized an IPO is just the beginning, not the end. Early employees, who hold much of the company’s intelligence in their heads, become rich enough to leave. The motivation of “someday we’ll be public” is no longer available. Outside pressure to “manage for quarterly results” begins. Preserving the knowledge and skill base of the company while achieving the forecast numbers become two of the biggest challenges. On a personal level, growth opportunities include learning to manage increased analyst scrutiny and formulating your next set of goals and aspirations.

An executive coach can help during many of the “moments of truth.” When growth is happening so quickly, employees (including founders!) may not have the time to grow into their roles; their roles are changing too fast, and they’re too busy building the business. When roles shift, or unquestioned assumptions and rules suddenly stop working, an executive or advisor can help you through what’s needed structurally, motivationally, or personally-to bring things back on track.

How do you find real community in a wired world?

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I really enjoyed Marina Keegan’s article “The Opposite of Loneliness.” The word I’d use as the opposite of loneliness is “community.” Community has been shown to be an important part of a happy, fulfilling life. Of course, there’s no economic model attached to community, so not only do we not manage it, we disregard it in our calculations and decisions.

It’s something I’ve thought a lot about the last 5-10 years, as it’s become apparent to me that the grown-up world we’ve created doesn’t provide much opportunity for it. Any sense of “we’re in this together” that may have existed in America seems to be long gone. The prevailing question seems to have become “How can I get mine and avoid giving any of it to anyone else?” Of course, if you feel like you’re in a community, getting yours becomes much less important, since you feel like someone’s there to help if you really need it.

The very things that we call “progress” are, I believe, a big part of the problem. Easy transportation and telecomm have made it easier ad easier for us to isolate ourselves in suburbs, with our work lives being played out far away, with people who don’t share our interests, who don’t like us, and who don’t live near us. Seeing someone once a month at a planned dinner out for two hours becomes the new definition of “friendship” (second only to the definition of friendship that involves reading someone’s status updates on social media).

If you have hobbies or interests that naturally lend themselves to seeing others (e.g. team sports), that can be a source of connection. But even there, it’s not clear to me that it’s the kind of connection Keegan is talking about in her article. I recall the feeling she’s discussing, and indeed, college is the last time I felt it.

For all you post-college folk out there, please share! How do YOU find community in your life?

Perfectionism. Sucks.

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How much of your life is controlled by perfectionism? Every time I think I have finally reached a balance, I manage to put myself in a situation where nothing less than perfect will satisfy me.

Last week and this I have been holding myself to impossibly high standards for a client engagement, 2 shows, a TEDx talk, and an audition for a summer musical theater program. I worked my butt off for the client engagement and believe it went well (awaiting evaluations still). But for the others, I have no standard for “good enough,” so I’m holding myself to impossibly high standards. The resulting stress is wasting mental resources that could be going into preparing as best I can for everything.

The problem isn’t the perfectionism. The problem is the stress caused when I don’t reach my standards. The stress doesn’t come from the activities themselves–I’ve done well in shows before, and I’ve given great speeches before—but from the beliefs that are surfacing around them: “I have to do it perfectly.” “Everyone’s counting on me.” “I should be able to do better than this.” and “This is the most important presentation ever.”

These are just thoughts, however. They may or may not be true. When I don’t think them, in lower-stakes situations, I’m fine. I step up, perform to the best of my ability, and learn to do even better next time. When I get wrapped up in the thinking, though, it becomes a stress-fest. Even if the thoughts are true, the stress does nothing but get in the way of doing my best.

My solution is to stop working on my performance for the next half hour and instead work on reducing the intensity of my beliefs. When my mental landscape is calm and clear, I can apply myself fully to doing the best possible job at my current skill level.

I’ll let you know how it goes.

(And any of your ideas on how to deal with perfectionism and perfectionist-thinking would be greatly appreciated!)

Our Intuitive Knowledge Isn’t Always Right!

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I was recently listening to a lecturer discuss how risk-taking is an integral part of “the entrepreneurial mindset.” He was very inspirational. Unfortunately, he was also flat-out wrong. There has been a lot of research into the psychological qualities of entrepreneurs. What has it concluded? There is no “entrepreneurial mindset”–entrepreneurs are a very diverse group. But especially among lifelong entrepreneurs who have experienced multiple successes, there is no evidence that they are any more risk-taking than anyone else. In fact, they do everything they can to mitigate risk.

My point, however, has nothing to do with entrepreneurs. It has to do with conventional wisdom. We intuitively (or culturally) want to believe that entrepreneurs are a special breed of person. That way, we have an excuse to be an entrepreneur if we deem ourselves “that breed.” Or we have an excuse *not* to be an entrepreneur if we aren’t “that breed.” Either way, we get to shift the responsibility for the decision to our personality type, rather than our decisions and efforts. That makes the very notion of an “entrepreneurial mindset” attractive, as a flexible rationale we can use for all kinds of stuff.

A lot of conventional wisdom is similar. The American myth that CEOs are somehow to credit for the entire performance of their companies, for example, is unsupported by any data whatsoever. W. Edwards Deming, the statistician who created the Total Quality movement, said that no more than 10% of a company’s performance could be attributed statistically to the CEO, and then only in highly unusual cases.

The problem is that our minds aren’t very good at understanding complex things. For 100,000 years, our minds weren’t able to do much beyond farm. Then we invented the scientific method, which was the first time we had a rigorous way to separate our intuitive-but-wrong ideas from the nonintuitive-but-accurate ways the world really works.

There is a lot of poorly-done science in the works. There is also a lot of excellent science, which is why we live 2x as long as our ancestors, in comfort, with electric lights and polar fleece.

Especially in the human potential fields–self-help, business leadership, etc.–there is a substantial body of research about how people and human systems actually work. Much of that research has even been popularized and published in books accessible to everyday people.

Before jumping on the pleasant, inspirational stories propagated in our cultural myths, take the time to read some of the research-based books on the topics. You can even go further and read the studies the books are based on. Some of the science (or the way it is being interpreted) may be ‘iffy,’ but some may be solid. And you may learn how the world *really* works, which will only make it easier for you to create the life you want.

(*) this is what I did for the Get-It-Done Guy episodes on visualizing for results. “The Secret” doesn’t work. They’ve done controlled experiments to find out. But some slight tweaks in the visualization technique *has* been shown to boost results. Not because of a deep spiritual principle, but because the right visualization gets people motivated and moving to make their dreams come true.