347-878-3837

HBSWK

Here are articles on HBSWK

Prepare Your Own Succession

QuestionMost founders of a successful family business sell their business to an outside third party. The 39 percent of family businesses passed to a second generation fail. Why don’t these owners plan better for one of the most important events of their lives?

Answer
If only it were just family businesses that didn’t plan well for the future. Most businesses woefully neglect the long term. And it’s not just the top executives who fail at farsightedness—few of us anywhere plan ahead. Before we jump into succession planning, there are some intriguing things to know about how we factor time into our decision making.

Think about some future plans you have. Notice how far out “the future” is for you. Are your plans for fifty years from now? Next week? Tomorrow? We all have certain time frames we naturally use when making decisions or thinking about the future. Those time frames drastically affect your decisions.

I awoke at sunrise on a Caribbean cruise and strolled up to the deck to behold row upon row of beach chairs, each with cup holder and ashtray. My first thought: “Great! Everything I need for a tan. Then perhaps a martini, and maybe a cigar. It’s the good life!” But if I took a thirty-year time horizon I might view this deck set-up as skin cancer, liver failure, or an emphysema station. Maybe it’s time to visit the casino, where I’ll lose 52 percent of my money on average at the blackjack table over the long term. The same situation looks very different depending on your time horizon.

Time Frame Exercise:
1. Think of a decision you’ve recently made.
How far out did you project the consequences when making that decision?
2. Now change the time frame. Make it shorter. Make it longer (even past the end of your life). Notice how that changes your mind.

Your decisions, your planning, and even how you look back and learn (or don’t) from the past are all affected by your time frame habits. If your time frame is brief, you probably spend a lot of your life in perpetual emergencies and fire-fighting, since, in a brief time frame, consequences of short-term emergencies are more real than the far-off consequences of creating permanent solutions. One of my best friends has such a short time horizon that he can be leaving for an appointment, spot the daily newspaper as he’s putting on his shoes, and spend twenty minutes reading it before realizing he’s just missed his appointment.

Being overwhelmed has driven us to ever-shorter time horizons. With more to do than we can even think about, we attend to the most urgent. That usually means the immediate emergencies. In a world demanding ever-faster results, we compress our time horizons more and more.

Rarer, but just as dysfunctional, is the opposite: a naturally long time horizon. Thinking ahead thirty years is great for insuring long-term success, but you’ve got to solve all the problems between here and there for it to matter. The Perfect Ten Year Plan is useless if you go bankrupt in the first year by not managing the day-to-day cash flow.

We are scared to plan for succession

Most people just don’t have a time horizon long enough to think about succession. If they do look ahead, they don’t like what they see: the day when they’re no longer here. And it’s not just in work; my estate planner tells me most people procrastinate writing their will for years. We avoid it, because in American culture, we’re just not taught to deal with our own mortality. (He’s been nagging me for a couple of years to get my estate plans in order. And I’ll do it—as soon as I’m done writing this article.)

Aside from mortality, there’s ego at stake. Does a founder really want to admit the company can survive without him? Come to think of it, does a founder really want to admit a legacy so fragile that it can’t survive without him? Quite a conundrum. It’s much easier to ignore succession altogether and concentrate on the next six months.

You might be thinking that it’s a leader’s job to do that planning, for the health of the business. Think again—and look in the mirror. It’s everyone’s job to do that planning. None of us want to admit that our companies/teams/families/communities can survive without us. But they can. It’s up to us to make sure that when we leave—and we will leave someday—the transition goes smoothly.

Start planning for succession long, long before you move on. Consider your first job responsibility to be training someone else to take over what you’re doing, so you can put your mind to learning the job above you before you’re promoted. Then when promotion time comes, you can step up with confidence that you have a head start and that your current job is in good hands.

Creating your succession plan

You can’t groom heirs unless you know what you’re grooming them for. Start by identifying all the responsibilities of your current job. Requests are your key to identifying your responsibilities. List all the requests anyone makes of you—customers, suppliers, bosses, employees, the public, even yourself. Each of those requests is a responsibility. Also, list all the requests you make of others. Ask yourself why you make each request. Your answers will be another list of responsibilities.
Now you have it: your real job description (formal job descriptions rarely reflect reality). For each responsibility, list the skills you use to meet the challenge. List the mindsets and attitudes you have, and any specific knowledge you use to fulfill that request.

Now you have a blueprint for bringing a successor—or several—up to speed. You use your real job description to identify who has many of the attributes needed to take over. Discuss the real job description with them, and get their input. Their ideas may differ on how the job can be done. Those differences might suggest alternate skills or approaches that can broaden how you do the job. More alternatives can also broaden the pool of potential successors.
Once you’ve chosen your people, start developing them. In their semi-annual learning and development review (of course you have semi-annual learning and development reviews, even if it’s not mandated by the company), help them choose assignments and experiences that will develop the skills you’ve identified to allow them to step into your shoes.

Juggle many replacements

There’s no reason to settle for a single successor. You can develop several people at once, especially since you can’t count on everyone staying put until you move on. One Fortune 500 company builds succession planning into every job above a certain level. They look for inside and outside candidates, and strive for a 3:1 ratio—three replacements in the pipeline for every job.

Furthermore, don’t assume you’ll be replaced by a single person. When you move on, your responsibilities may be distributed throughout a group, or may be taken over by a team. We all fantasize about being so valuable it’ll take a team to replace us; indulge the fantasy. You can develop some skills in some group members, and other skills in others. Of course, you’ll need to insure the team can work together when it’s time.

One caveat to choosing multiple replacements: Manage the situation delicately. If you tell five people that they’ll all be your replacement, you’ve just introduced competition that might cause four to quit when the fifth gets promoted someday. Simply help them develop, and make it clear to folks that the best way to succeed at any level is ongoing achievement and growth; specific jobs aren’t guaranteed.

Once you’ve got your succession plan under way, start working on your boss’s…with you as the successor. Profile your boss’s job and voila! You have your own development plan. It won’t guarantee you get the job, but you’ll be better and more effective as you move forward, and you’ll have a whole cadre of people able to step into your job when you move up to Chairman.

© 2005 by Stever Robbins. All rights reserved in all media.

See other stories in this series.

Truth and Trust: They Go Together

QuestionWe’ve lost trust. How do I regain the trust of my employees after six rounds of layoffs? How does my organization regain the trust of the community after we dumped toxic waste and covered it up? How does my management team regain trust of each other after a nasty political battle?

AnswerDo you trust me? Good. The truth is, you can’t regain trust. Period. You doubt? Think hard about the times you’ve been betrayed. Did the villain ever find their way back into your heart? If you’re like the thousands I’ve asked, the answer is never. Trust can be gained once and lost once. Once lost, it’s lost forever.

So let’s ask how we can keep trust from the start. It’s really quite easy; if you want to be trusted, simply be trustworthy. The pressures will be great to act otherwise, and if you succumb, well, you’ll lose trust and you’ll never get it back.

Tell the truth

I’ve heard countless discussions about how customers, suppliers, employees, shareholders, or communities can’t be told the truth. Maybe we believe that they can’t handle the truth, or that the truth will make us look bad, or maybe we don’t want to take responsibility for the consequences. So we “position” our statement. We “frame it” carefully. We “massage it.” We use careful “spin.” In other words, we lie.

Little white lies can work—they help life run smoothly. But bigger lies compound. We end up committing beyond our own moral comfort. This action is recognized in a social psychology principle called “commitment and consistency.” That is, once we have taken a position, we are motivated by various pressures to behave consistently with that position, even if it is eventually proven wrong. Our ethical standards slip a bit more each time we hold on to our original stand. Pretty soon, our relationship with the truth is arms-length at best. (For more on commitment and consistency, see the wonderful book Influence: The Psychology of Persuasion, by Robert Cialdini.)

When people find out you’ve been lying to them, they know your words can’t be trusted. If it’s your spouse, they may give you a second chance. If it’s your community, they may tell you they’re giving you a second chance, but don’t count on it.

Of course, there can be genuine reasons you can’t tell the truth. Sometimes you’re legally bound to remain silent. Sometimes you’re negotiating and can’t reveal your position. In those cases consider saying, “I can’t discuss that.” People won’t like it, but they won’t feel betrayed when the outcome is revealed.

Keep promises

Keeping promises is an especially powerful form of telling the truth. If you say you’ll do something, do it. If you promise you’ll show up, be there. If you say you’ll deliver high quality, don’t skimp. We all know business people who eagerly promise anything to a customer or colleague rather than face their disappointment. They rarely remember what was promised, which is just as well because they couldn’t have delivered. Over time, their credibility drops so far that no one in their company believes a word they say.

Your marketing material makes promises, by the way. As a response to the low-carb craze, some cereal companies made “low-sugar” cereals. Read the label carefully and you’ll discover they have as many carbs as high-sugar cereals. If you’re targeting health-conscious consumers, don’t promise them health and then deliver junk food. Keep your promises and you’ll keep trust.

Their interests before yours

One powerful way to sustain trust is to put the interests of others ahead of your own. When people know you’re looking out for them, they’ll believe in your intentions even when you have hard news to deliver or need them to put in heroic efforts.

In the book Good to Great, Jim Collins introduces the “Level 5 leader” who puts the needs of the organization ahead of his or her own ego. Such leaders really inspire us to give our all because they demonstrate by example that with personal sacrifice we can achieve greater success as a group.

Putting others first means knowing their goals and concerns, and helping them. Is a colleague a passionate baseball fan? Give them your Red Sox tickets some afternoon, for no reason at all. Is that the game where the Red Sox win the World Series? Even better! You’ll suffer real pain at giving up your tickets. Public sacrifice, if it’s real and visible, builds huge credibility when it’s in the service of others. And the sacrifice must be real. Reducing your bonus from $2 million to $1.75 million just doesn’t count.

Behave ethically

At its core, people trust you when they know you’re safe to deal with. They observe how you treat them and others. Do the right thing in all your dealings and people will get it. They’ll know you’re trustworthy.

If you get a reputation for taking advantage of others, however, even people whom you have treated well can start to doubt. One CEO wrote articles trumpeting his ethical behavior. Employees knew otherwise; they’d seen him cheat distributors and shirk on his commitments to his partners. So the more the CEO crowed, the more the grapevine passed anonymous notes highlighting his lies.

Changing players to gain trust

Trust isn’t one-way, of course—trust happens between two people, or between a person and an organization. You can trust a person while distrusting their organization. I love my trusted bank manager; she fixes my problems even when I feel like the bank is hell-bent on alienating me at every opportunity. (They charge how much for a bounced check?)

You can trust an organization while distrusting its people. Think politics. We can trust our country’s integrity even when individual politicians make our stomachs crawl.

In business, one bad manager rarely destroys trust in the entire company. But several bad managers, armed with policies that clearly treat people as disposable implements, can destroy trust in an entire organization.

At that point, bringing in a new management team that takes clear, visible action might have a chance of rebuilding trust. These actions will be hampered because employees have learned to distrust the organization as a whole. But at least the new leaders will have a chance to gain one-on-one trust and translate that into the organizational changes needed to build trust throughout.

Is this really necessary?

I must confess that this article has been hard to write. “Do the right thing,” “Treat people with respect,” “Don’t lie.” Do these things really need to be said to adults? Apparently so. As businesspeople, we’re not trustworthy.

The June 2002 Conference Board Commissions on Public Trust and Private Enterprise Report found that somewhere between 37 percent and 76 percent of employees “observed misconduct they believe could result in significant loss of public trust if it were to become known.” Of course, the employees are the public, so public trust is losing on an ongoing basis.

It’s up to us to fix the situation. We need to regain the public’s trust, which means we need to regain our trust in each other. And it will only happen if we become the most trustworthy people we can become.

Your action challenge this week

Pay attention to how often you tell the truth, how often you make decisions as if other people (customers, employees, suppliers) don’t matter, and how often you put the well-being of others ahead of your own. Then ask yourself: Am I someone I would trust?

© 2005 by Stever Robbins. All rights reserved in all media.

See other stories in this series.

The Path to Critical Thinking

Question
Can you write a refresher on critical thinking?

Answer
We business leaders so like to believe that we can think well, but we don’t. Only one in seven even reaches the top 10 percent of quality thinkers.1
The rest of us haven’t even read a book on critical thinking, much less practiced. We could fill a book on the topic, but instead, let’s indulge in the highlights of what makes for good critical thinking about decisions.

What’s logic got to do with it?

Nothing! We don’t use logic to decide, or even to think. And a good thing, too, or the advertising industry would be dead in the water. Unfortunately, all of our decisions come from emotion. Emotional Intelligence guru Daniel Goleman explains that our brain’s decision-making center is directly connected to emotions, then to logic. So, as any good salesman will tell you, we decide with emotion and justify (read: fool ourselves) with logic.

Purely emotional decision making is bad news. When insecurity, ego, and panic drive decisions, companies become toxic and may even die. Just look at all the corporate meltdowns over the last five years to quickly understand where emotional decision making can lead.

Critical thinking starts with logic. Logic is the unnatural act of knowing which facts you’re putting together to reach your conclusions, and how. We’re hard-wired to assume that if two things happen together, one causes the other. This lets us leap quickly to very wrong conclusions. Early studies showed that increasing light levels in factories increased productivity. Therefore, more light means more productivity? Wrong! The workers knew a study was being done, and they responded to any change by working harder, since they knew they were being measured—the Hawthorne Effect.

We also sloppily reverse cause and effect. We notice all our high performers have coffee at mid-morning, and conclude that coffee causes high performance. Maybe. Maybe not. Maybe high performers work so late and are so sleep deprived that they need coffee to wake up. Unless you want a hyper-wired workforce, it’s worth figuring out what really causes what.

There are many excellent books on logic. One of my favorites is the most-excellent and most-expensive Minto Pyramid Principle by Barbara Minto. It’s about logic in writing, but you can use it for any decision you want to think through in detail.

The trap of assuming

You can think critically without knowing where the facts stop and your own neurotic assumptions begin. We aren’t built to identify our own assumptions without lots of practice, yet the wrong assumptions are fatal.

When we don’t know something, we assume. That’s a fancy way of saying, “we make stuff up.” And often, we don’t realize we’re doing it. When our best performers leave, our first (and perhaps only) response is to offer them more pay, without realizing that other motivations like job satisfaction or recognition for accomplishments might be more important.

Finding and busting “conventional wisdom” can be the key to an empire. For decades, the standard video rental store model assumed that people wanted instant gratification and, to get it, they were willing to drive to a store, pay a rental fee for a few days’ access, and then drive back to the store in a few days to return the movie. Thousands of big and small video rental parlors popped up across the country using this model. But Reed Hastings challenged those assumptions. He calculated that people would trade instant gratification for delayed, and would pay a monthly fee if they could have movies mailed to them, which they could keep as long as they liked. The result? Netflix. Estimated 2005 revenue: $700 million.

Assumptions can also cripple us. A CEO confided that he never hires someone who backs into a parking space. His logic (and I use the term loosely): The person will use time at the start of the day so they can leave more quickly at the end of the day. He assumes face time equals results. In whose world? Many people tell me they get more done in an hour at home than in eight hours in an interruption-prone office. How many great employees will he miss because he’s not examining his assumptions?

Some assumptions run so deep they’re hard to question. Many managers can’t imagine letting people work fewer hours for the same pay. “If they go home earlier, we have to pay them less.” Why? “Hours = productivity” is true of assembly lines, but not knowledge work. Research shows that it’s not how much you work, but the quality of the work time that drives results.2 But in most workplaces, hours count as much as results.

Next time you’re grappling with a problem, spend time brainstorming your assumptions. Get others involved—it’s easier to uncover assumptions with an outside perspective. Then question the heck out of each one. You may find that one changed assumption is the difference between doing good and doing great.

The truth will set you free (statistics notwithstanding)

Have you ever noticed how terrified we are of the truth? We’re desperately afraid that the truth will reveal us as incompetent. Our situation really is hopeless. We really aren’t as great as we pretend. So we cling to our beliefs no matter how hard the truth tries to break free.

Guess what, recording industry: Electronic downloads have changed the nature of your business. Start asking how you’ll add value in a world where finding, packaging, and distributing sound is a commodity. Hey, ailing airlines: Oil’s expensive, customers won’t pay much, and you have huge capital costs. That hasn’t stopped Southwest, Jet Blue, and others from making a fortune.

Nothing tells the truth like solid data and the guts to accept it. But it’s difficult in practice. When was the last time you identified and collected data that contradicted your beliefs? If you found it, did you cheerfully change your belief, or did you explain away the data in a way that let you keep your comfortable pre-conceptions?

Here is a great exercise for your group or company. Have your general managers list your industry’s Unquestioned Truths, which they then must prove with data. When a Fortune 500 CEO recently ran this exercise, Surprise! Some “absolute truths” were absolutely false. Now he can do business his competitors think is nuts. Analysts will say he’s off his rocker, until his deeper knowledge of truth starts making a small fortune.

One caveat: Be picky about where you get your data. The Internet can be especially dangerous. The miracle of technology lets one bad piece of data spread far and wide, and eventually be accepted as truth.

Help! I’ve been framed!

Not only may your data be disguised, but the whole problem itself may be disguised! It seems obvious: we’re losing money, we need to cut costs. Not so fast! How you “frame” a situation—your explanation—has great power. Remember assumptions? Frames are big ol’ collections of assumptions that you adopt lock, stock, and barrel. They become the map you use to explore a situation.

You’re negotiating an acquisition. You’re chomping at the bit. It’s WAR!! Competition is all. The frame is combat!

Or, you’re negotiating an acquisition. You’re on a journey with the other party to find and split the value buried at the X. You still track your gains and gather intelligence, but the emphasis is on mutual outcomes, not “winning.”

In a zero-sum one-time negotiation, a combat frame may be the best tool. But in a negotiation where you’re free to develop creative solutions that can involve outside factors, the journey frame could work best. “Instead of $100K, why don’t you pay $75K and let us share your booth at Comdex?”

Frames have great power! Presented with a potential solution to a problem and told, “This course of action has a 20 percent failure rate,” few managers would approve. When that same solution is presented as having an 80 percent success rate, the same manager is going to consider it more deeply—even though a 20 percent failure rate means the same thing as an 80 percent success rate! The frame changes the decision.

Are you brave in the face of failure? Most people aren’t. I recommend the responsibility frame: “What aren’t we doing what we should?” The responsibility frame sends you searching for the elements of success.

The beauty is that no one frame is right, just different. The danger is when we adopt a frame without questioning it. You’ll do best by trying several different frames for a situation and exploring each to extract the gems.

People are our greatest asset. Really

Critical thinking isn’t just about what happens in our own brains. When you’re thinking critically in business, bring in other people! We don’t consider the people impact in our decisions often enough. In fact, we pooh-pooh the “soft stuff.” We feel safe with factors we can calculate on our HP-12B. But in truth, business is about people. Multibillion-dollar mergers fail due to culture clash.

Customers, suppliers, partners, employees. They’re as much a part of your business as that sparkly new PC you use to play Solitaire. How will your decisions change their lives? Imagine being them and let your imagination change your decisions.

The Gallup organization estimates that 70 percent of America’s workers are disengaged, and disengaged workers are dramatically less productive, creative, and committed than engaged workers. Yet few strategy meetings ask, “How can we engage our employees more?” It’s as if we say people are our greatest asset—but we don’t really believe it. If you want to improve your critical thinking, get other points of view.

A stitch in time saves nine

Of course you know you should think about the consequences of your actions. But with information overload, quarterly earnings pressure, sixty-hour weeks…who has the time? We don’t think much beyond the end of our nose.

But technology leverages the effects of our decisions throughout the organization and even across the globe. So good thinking demands that you consider consequences over many timeframes. Think out a month, a year, a decade, many decades. That tanning booth looks great when you consider how you’ll look in a week, but is it worth looking like a leather overcoat ten years from now?

Long-term junkies like me are great at creating ten-year plans, but managing next month’s cash flow? Not likely. Short-term junkies are more common; they’re the ones who discount to make this quarter’s numbers, while tanking the company in the process. You can do better by considering multiple timeframes.

I could go on, but there’s plenty here to chew on. Think about a decision you’re making, and pull in the rigor:

  1. Make sure you understand the logic behind your decision.
  2. Identify your assumptions and double-check them.
  3. Collect the data that will support or disprove your assumptions.
  4. Deliberately consider the situation from multiple frames.
  5. Remember the people!
  6. Think short and long term.

Good luck.

© 2005 by Stever Robbins. All rights reserved in all media.

See other stories in this series.

Linking Vision, Strategy, and Tactics

You’re so proud of your new vision statement. It sounds nice. Inspiring, even. But the vision is useless unless it can direct action.

Your vision lays out a destination; your destination guides your strategy; and strategy chooses action. It’s action that leads to success. In those moments of action, having clear direction is crucial for building momentum. If your organization is like most, you spent weeks debating every word crafting your vision, mission, strategy, and goals. But no matter how lofty, if they aren’t created in a way that provides direction, those statements are little more than high-priced indulgences.

Every company means something different by the words “vision” and “strategy.” One person insists that “Provide our customers the highest possible quality widgets” is a vision. A friend takes one look and assures him, “That’s a strategy.” Here are some useful definitions that will help you decide if you’ve set a direction that can truly get traction.

Envisioning the future

Vision is timeless. It’s based on who/what you want to do. It’s why you’ve got an organization in the first place. It must be specific enough that everyone can use it to decide if their work is moving the company forward. Progress towards the vision must be measurable. A vision is independent of specific competition, and while it may mention the customer, it must guide even someone who doesn’t know the customers’ mind. The best visions imply whom the company serves, what it provides, and what distinguishes it from other companies providing the same products and services. Vision sets the broad direction. It says, “Go west, young man.”

Wrong: We will provide exceptional products and services that our customers value.

This vision requires knowing the customers’ mind in order to understand what the company provides. It doesn’t distinguish what is unique about the company, since presumably everyone in the market produces something customers value.

Right: We will help boat owners everywhere navigate new seas with geographically based directional products and services.

This vision tells us the market, the product (navigation products and services), the distinguisher (geographically based), and the progress measurement (delight).

The strategy thing

Strategy links the destination (vision) with current reality. Strategy applies to the whole company, and answers the question “How will we reach our vision, given current market conditions, competitive scenario, regulatory environment, etc.?” Strategy is narrower than vision, but broad enough to guide companywide organization structure, hiring, capabilities that must be developed, and so on. Strategy says, “We’re going west, but we ran into this grand canyon. We can go around to the north or south. Let’s choose south.”

For example, a company may have a vision to “provide scientifically proven technology to solve the medical needs of consumers and hospitals.” In the 1950s, the strategy may be doing in-house research, hiring and developing scientists, and a compensation program based on discovery. In the 1990s, the same company may have a strategy of acquiring small drug-making companies and buying and protecting patents from other companies. Both strategies will reach the vision, but they are appropriate for different competitive environments, and they have different organization structures, different financing options, and different operational characteristics.

You know you have a strategy if you chose your current path from many alternatives, all of which would have reached your vision, each of which would have required hiring different people and building different systems. If you didn’t consider many alternatives, or you didn’t choose your alternative considering your competition, your vision, and your current market conditions, then you probably have a tactic, not a strategy. If you can execute your strategy with your current people, reward systems, and organization structure, then it’s not a strategy, it’s a tactic.

The tactics

Tactics are limited in scope, typically just to a part of the company. They’re shorter term than a strategy. They involve executing given the existing capabilities and resources of the company. Unlike strategy, tactics generally work within the current organization structure, rather than changing the organization. Tactics say, “We’re on the south path. Let’s travel two miles today.” Your tactics probably won’t work unless they’re generated from a strategy that lays out a consistent philosophy for how your company will compete/win/attract customers in today’s market.

My article on giving your organization serious traction

“Flashpoints” are those moments in time when traction and momentum are built. For example, a flashpoint in creating a quality-driven organization might be when the CEO refuses to ship a poor-quality product, even though it will hurt quarterly numbers. Flashpoints always happen during a tactical action. That’s why you need a vision and strategy—without them, people at the flashpoint won’t have the guidance to ensure they can move the company forward in that moment of traction.

Your strategy also helps you find flashpoints. If your strategy involves locking up important distributor relationships, your flashpoints will involve reputation and relationship building, creating the perception of value to the distributors, and establishing negotiating leverage to capture an exclusive relationship. If your strategy is to be a low-cost provider, your flashpoints might be times when opportunities for efficiencies arise, or incidents where you can encourage a “continuous improvement” mindset in your team.

At the end of the day, your vision and strategy only exist to drive tactics. And often, the most significant tactics are those flashpoints whose effects are far-reaching. When your vision sets direction and your strategy ties it to your current situation, they provide a compass for everyone in your organization to follow for years to come.

© 2004 by Stever Robbins. All rights reserved in all media.

See other stories in this series.

Give Your Organization Serious Traction

When we’re getting traction on something new, we typically have a week’s worth of work to do, and an hour to do it. The International Labor Organization says Americans win the prize for the most overworked people in the world.1 We’re productive, not because we work well (Europe matches our hourly efficiency) but because . . . we just work more hours. That means we’re working hard, but not smart. By working smart, we can still produce and also have a life.2 The challenge is pouring time and energy strictly into what really matters by exploiting your moments of truth.

Begin at the end

Most of our time at work is wasted. Only some of what we do moves the business forward. The rest is plain, old-fashioned bureaucracy. But you can’t know what moves the business forward unless you know where “forward” is.

In your search for moments that matter, keep your highest end goal—your vision—constantly in mind. Think golf—the secret to a good golf game (so they tell me) is not aiming at the ball; it’s aiming past the ball. Be guided by the direction, not the specific next step. We often get caught up in aiming at the ball. For example, many executives aim for shareholder wealth. Bad idea. Shareholders get wealthy when customers pay good money for products that solve real problems. Aim for that. Your vision proclaims how you plan to satisfy customers. Do that well and the money will follow.

The measurement moments

Some of your most important moments are when you have the chance to gather key information. A trip to a competitor’s plant, for example, can be an excellent opportunity to spot best practices and gather competitive intelligence. For a financial analyst, the critical moment may be the chance to hear a CEO speak on his or her company’s future plans.

You need to know what information is critical and also how you’ll use it when you get it.

As you prepare for measurement moments, know what information you’ll ignore. Then ignore it. We’re so awash in information that it’s tempting to collect it believing that any knowledge is useful. Nothing could be less true. Lots of access to the wrong information obscures what really matters. Financial markets are a great example. Tracking a company’s stock price—a common pastime—is often a source of bad information. The stock’s daily rise and fall promotes emotional decisions that are better made with careful thought and deliberation.

You need to know what information is critical and also how you’ll use it when you get it. Then when your Moment arrives, you’ll know what to look for, you can go for it, and then spring into action. I’ve seen marketing departments get a critical chance to talk to customers. They wanted information about a customer’s buying behavior, but didn’t think about how their questions would gather that information. So they asked about brand recognition instead. Is brand recognition important? Probably so. But they missed the chance to gather and use the information that was really critical.

The decision moments

Often, a decision will be a Moment of Truth. In the moment that something triggers the need for a decision, you must to be ready to move.

Decisions are rich events. Your values get expressed through your decisions. Decisions communicate your priorities to everyone (including you!). Depending on who’s involved, the decision can also be building political capital among those who take part.

Taking the best advantage of a moment of decision demands that you have the information you need for the decision, the people involved, and the means to communicate and act on the decision. You also need to know when to trigger the decision.

Shell Oil’s famous scenario planning of the early 1980s is a great example of identifying and acting on moments of truth. One of Shell’s scenarios was exploring the fall of the Soviet Union. Early on, they identified Mikhail Gorbachev as a pivotal player in the USSR’s future. When he rose to power that triggered Shell to act on its scenario to prepare for the opening of the country. Thinking through their strategic decisions ahead of time gave them a huge lead when the time came to make those decisions.

Your critical decisions will change over time, which makes preparation an ongoing project. A young software company was deciding how to spend far-higher-than-expected profits. One manager asked if higher sales figures came from growing market share or from losing share in a market that was growing overall. Alas, the marketing manager hadn’t prepared that information. Product plans were made without that information, and the company didn’t get traction in the evolving market. If you’re going to be prepared for your decision “moments of truth,” know what information you’ll need to make the decisions and arrange to have it at your fingertips.

Future moments

Shell’s scenario group wasn’t just finding triggers; at a deeper level, they were finding issues with long lead times and addressing them soon enough to do something smart. Do you know what you need in place this time next year? Five years from now? Two weeks from now? Sometimes you need concentrated efforts now to prepare for crucial events much later.

Relationship building is a long-lead-time activity that can be crucial. If you’re going to be entering a new market in a year, now is the time to start getting to know the key influencers, industry reporters, and main distributors. When the time comes to enter the market, you’ll be able to jump right in with credibility, having already started building the relationships you need.

SoftSoap’s rise to market dominance is a great example of a long-term moment. The SoftSoap creators realized that competitive products would need plastic pumps for the liquid soap. So SoftSoap bought up the world’s supply of plastic pumps, forcing competitors to wait a year until more pumps could be made. By imagining the future and understanding the long-lead-time issues, a single purchase event became the moment that gave them a year’s head start in their market.

As important as it may seem to create that great new logo for the product, don’t do it!

Infrastructure investments are moments that lock in commitments that can make or break your future. A CEO recently confided that his company can enter a new market and hit 26 percent profit margins within three months. Unfortunately, the company overinvested in too-large plants early in the game—assets that are such a drag the company may still fail. When you have a moment of decision or implementation with huge long-term consequences, it’s worth the time to focus on making the right decision.

Look across all business areas

When you’re searching for your most important moments, remember to consider the entire business. We often think first of areas we know well, and forget others. But the best leverage points rarely cluster in one functional place. Sometimes you may focus efforts on finishing development for a trade show. Then, emphasis shifts to landing a key distribution contract. Next, your most important moment may be when your first reviewer receives and uses your product. Your job is aligning all your efforts behind each moment so you squeeze every bit of value from your significant events and decisions.

Moments that don’t matter

Your goal here is really to tease out the moments when your actions really matter, and concentrate on those. That’s only half the battle, however. The biggest challenge can be in dropping efforts on the moments that don’t matter.

Human beings have a weird habit of creating projects and initiatives that never die. Once something is under way, we want to keep it alive no matter how useless it is. Resist! As important as it may seem to create that great new logo for the product, don’t do it! Face facts: The logo won’t make or break a product launch. A product that doesn’t solve the problem, will. Be ruthless about putting limited resources—including your time—into only those moments linked directly to success.

Concentrate on high-leverage moments

Remember our goal is achieving more by doing less. You may identify more moments of truth than you possibly have time to pursue. Choose between them by putting your efforts where the leverage is greatest, where you get the biggest bang for the buck.

Leverage is simply the biggest return for your effort. If you have three public events you can speak at, one to a group of customers, one to a group of the most influential industry distributors, and one to your local bridge club, chances are that the distributors will be your best bet. Why? Because if ten distributors are impressed, they can help you reach thousands of others.

At the end of the day, results matter—not efforts. When an important initiative isn’t gaining traction, or when you’re starting something new, the secret lies in “micro-focusing” on the moments that make a difference. If you know where you’re going, you can put your effort into just the measurements, decisions, and long-term important initiatives that will let you move ahead with results and not merely hard work.

© 2004 by Stever Robbins. All rights reserved in all media.

See other stories in this series.

Making it Right with Wronged Employees

QuestionAn executive team laid off a group of employees here in Canada in order to outsource to an Asian country. They can’t find talent in the new country, work has stalled, and management tries to cajole laid-off employees (all talented, experienced peak performers) to return. The laid-off employees demand a written apology from the management and request that some executives be fired.

My question: Should upper management issue an apology and suck it up and try to get their best talent back?

AnswerThis is a Moment of Truth for your upper management. What they do will send a clear message to the company. Before we explore what to do, let’s explore how management arrived at this difficult place.

The employee point of view

You’re a talented, experienced peak performer. You’ve been working hard and keeping a project progressing smoothly. One day, you get a notice that—through no fault of your own—you’re laid off because someone wants to move your group to another location.

Do you jump with joy, exuberant at the gloriously superb business decision made by upper management? Doubtful. You probably feel upset, resentful, unappreciated. You might even feel personally affronted, as if you were being treated like an interchangeable cog in a machine. The message you received: You’re not unique, you’re not valuable, and you’re quite replaceable (or even . . . “fungible”).

The management point of view

You have a group that’s doing great. It is full of talented people, making progress. A business issue comes up. Perhaps you want to locate that group nearer a supplier. Or maybe you want the project to take place at a cheaper facility. Possibly, you’re just empire building and want to consolidate your empire. You decide to disband the existing group and reform it in a new location. It should be a simple matter, you think, to find people to run the group in the new location.

• • • •

Managers are thinking of the business. They’re thinking tasks, processes, locations, efficiency. They’re thinking everything but people. The employees, being people, are taking the move personally. Whether or not it’s meant personally, that’s how it’s coming across. (Note: when someone’s project is canceled or they’re laid off, they always take it personally. Trust me.)

If a highly visible manager made this decision, the company is also making a statement that it cares more about efficiency, consolidation, etc. than people. True or not, the loud-and-clear message is that employment is about transactions, not about loyalty or commitment. The laid-off employees got that message loud and clear, and their return is a clear negotiation.

And what are they asking? They don’t want more money, bonuses, or vacation time. They want an apology. Apologies are what people want when they feel they’ve been wronged. We can debate whether or not the layoffs were wrong, but the feelings they evoked are real. If the employees feel wronged and an apology will fix it, my advice is to apologize and get on with life.

Apologies aren’t fatal.

Maybe the executives think it unfair to apologize when they don’t think they were wrong. That’s not the issue. The employees thought it unfair to be laid off for doing a good job. This isn’t about fair; it’s about feelings. Apologies will fix the feelings. Has anyone (think: significant other) ever wanted your apology when you knew you were right? You refused, and maybe even won the argument. You got to be RIGHT. And did it strengthen the relationship? Of course not. Would saying “I’m sorry” and letting go of being RIGHT have fixed the relationship? Of course.

Maybe the executives fear an apology because deep down, they feel they screwed up and don’t want to admit it. In this case, it sounds like they were wrong and badly bungled a situation. All I can say is, “Get over it.” Have them hire a coach or, if it’s really deep-seated, a therapist. If they can’t admit their mistakes, they can’t learn, and that will eventually doom the business.

Maybe the execs fear that apologies will undermine their leadership. They may believe that leaders must appear infallible, that apologies are admissions of failure and must be avoided at all costs.

Nonsense! If a leader screws up, it’s no secret. Everyone knows. The secret is that screwing up and handling the recovery well can actually strengthen a leadership relationship. A good recovery acknowledges the problem, addresses feelings, and gives reason to believe the future will be better: “I really screwed up by thinking I should consolidate the group on the West Coast. I didn’t value the people in the existing group, and I didn’t honor their contribution. I’m very sorry. In the future, I will do my best to make decisions taking the people into account, and not just the business.”

Firing might be the solution

The employees want someone fired. If all they want is revenge, don’t do it. Firing for revenge sets an ugly precedent—almost as ugly as disbanding a group of high performers without preparing for the consequences. But might there be other reasons for this (admittedly extreme) request?

Consider: The executives laid off people whom you characterize as talented, experienced peak performers who were doing their job well. Yet they didn’t make sure that they could replace those people, and obviously, the way they were laid off left the employees angry and resentful. In short, the executives failed miserably at their own jobs.

To me, an outside observer, the message is that it’s perfectly OK to lay off peak performers who are doing their job. Yet it’s not OK to fire executives who don’t do their jobs. In this case, keeping the executives sends a clear message that worker excellence is valued less than executive incompetence, and firing incompetence is generally regarded as a good idea.

So you need to decide: In your company, should business needs trump individual emotional needs? With the original layoffs, the answer was clearly Business Wins. If you want to be consistent, analyze the situation without regard to the people. You have a stalled project that can be resurrected with an apology and a firing. What’s the project worth to the company? What’s the executive worth to the company? Abandon the one with least value.

You can always decide that taking people into account makes sense. Personally, I put human needs above business needs, and I’ve found that it builds incredibly loyal, dedicated teams. Either way, consistency is important. If you take people into account when the people are executives, and take business into account when the people are of lower status, you’re really just engaging in nepotism and privilege. Many, many businesses run that way, but it isn’t going to build a committed, loyal, inclusive culture. If you want a strong company, choose your standards and make them consistent throughout.

Strengthening the group

It seems that everyone in this situation is framing this as a conflict. Yet at the end of the day, everyone shares a common goal: to build a successful company that can keep everyone employed and happy. It’s important to get the group back together and moving forward. After apologies and re-hirings, why not use this as an opportunity to reorient the group around the common goal?

This is an emotionally charged situation that has brought up many issues including politics, business decisions and their impact on people, and whether layoffs and firings are the best solution to business and interpersonal problems. Consider getting everyone in a room (perhaps with a professional facilitator, if feelings still run hot), with one agenda: uncover learnings for everyone involved about how better decisions can be made, how feelings can be managed, and how executives and employees can better understand each other’s point of view. Learn from your successes as well as your failures—go beyond this layoff/rehiring situation as a source for learning and also consider similar decisions that went smoothly.

At the end of the day, your question is about people, not policy. If the original layoffs had been planned with attention to the feelings and needs of the people as well as the business, life would be a lot easier right now. As it is, there is emotional cleanup that must happen before the organizational cleanup begins. An apology is a small price to pay. Firing is a high price, but your organization has already said by example that business needs trump individual needs. If an executive’s continued employment is all that’s standing in the way of resurrecting a necessary project, it may be time to relocate that executive, even if she’s a talented, experienced peak performer.

© Stever Robbins. All rights reserved in all media.

Minimize Secrecy, Maximize Knowledge

People have lots of reasons for hoarding information, mostly bad ones. But sometimes it’s good to keep quiet. After all, you want information to get where it’s needed, in a way that serves everyone involved.
Our daily job as managers is simple. We observe, taking in information. We think about it, make decisions, and then act.1 In the past, observation created a bottleneck. Information was hard to find, hard to duplicate, and it traveled slowly—often by ship, train, or horseback.
Information was also scarce, and that made it valuable. Power was gained by hoarding information and being shrouded in mystery. That was then, this is now. Hoarding information used to be a show of power, now it’s just annoying. The bottleneck has moved, and with it, the dynamics of who wins and who loses.
Most of us are flooded with too much information. What we need is time and space to think and act. Now, power comes to those who can harness information by getting it to the right people at the right time, so they can move the organization forward.

Which brings us to confidentiality. Imagine a Powerful Executive Team (PET) that keeps things confidential unless there’s a need to know. The PET graces employees with the nuggets of wisdom needed to do their job. This scheme demands that the PET know enough about their employees to judge who needs what information and when. If the PET is hiring right—that is, hiring people smarter than they are—then they can’t predict who will need what. Innovation and creativity often come from someone using information in novel ways. The information-hoarding PET may strut around feeling powerful, but with China, Singapore, and Silicon Valley nipping at its heels, its days are numbered.
A better, twenty-first century strategy is making information part of your business infrastructure. Let go of information-as-power, and instead embrace information-as-lifeblood. You must channel it well, but if you make the right information pervasive, you’re building for strength.

Spread knowledge about strategy to set direction

Our brains are learning machines. If you imagine a goal, gather feedback, and allow flexible action, then performance improves almost without effort.2 Business is made of people—make goals and feedback the most important information to share.
Your goals are your vision, mission, and the subgoals they create. Everyone in your organization should know your vision and mission—your C-level team, VPs, managers, and line workers. The vision and mission become the ultimate “why” of everyone’s job. By knowing the larger vision, people know what they’re working toward. They can feel proud to be part of something large, even if their job is small.
And of course your vision and mission are goals to achieve. “We improve the quality of healthcare by providing doctors, nurses, and hospitals scientifically proven medical devices” is one company’s vision. You can bet every researcher, salesperson, manager, and customer service person can use the vision to decide daily if they are advancing the company. If not, they can make course corrections on the fly.

Strategy helps people link their job to the vision. One financial services company’s strategy is to be a “trusted friend” to its customers. If everyone at the company lives and breathes this, they’ll work to establish relationships rather than cutting customer calls short to meet call-length quotas.
“But wait,” you say, “you can’t have call reps on the phone for hours gabbing with customers!” Quite right. That’s where feedback comes in. People need to know their performance metrics (with as little delay as possible!) and how they link to the goals, so they can make their own corrections.
When personal finance software maker Intuit was small, Monday morning was time for the Metrics Meeting. Every department presented their critical measurements to the assembled crowd. Everyone was welcome, and when everyone knew sales, support call volumes, etc., the staff could brainstorm when something drifted off track.
Your most global measurements are your financial statements. If all employees know your business model and can read the financial statements, they can make informed judgment calls. Your call center customer reps quickly decide: “It’s not worth spending all day with a customer whose lifetime value is $500. My job is to resolve or let the customer go.” Or, if you are a fractional jet ownership company where customer lifetime value is in the millions, your reps can decide to hand-hold a single customer for the better part of their natural life.
(It may take tweaking to discover the best level of information sharing, but the rewards are great. For teaching people to link financials to their job, Profitability Business Simulations (www.profitability.com) has one of the best programs I’ve ever found.)

Spread knowledge about the organization to build efficient operations

It always amazes me how few people in business—other than the managers who institute a reorganization—understand their organization’s structure and processes. Yet that understanding is critical to making things happen.
The larger your business, the smaller the jobs. In a fifty-person company, one person might handle accounts receivable and be an account manager. Since they deal with customers as an account manager, they can mention receivables issues as part of that relationship. In a 5,000-person company, however, receivables may take four full-time people, each doing just part of the job.
In a really specific job, people lose the big picture. They don’t know where work comes from or where it goes next. And they rarely know why it matters.

So give them that knowledge! Make sure everyone knows where they are in the business, and why what they do matters. Then when they meet others in the process they can devise ways of making things run more smoothly. And besides, it helps people feel more meaning in their jobs. Gallup surveys say roughly 70 percent of workers are disengaged from their jobs. Do you doubt it? If your job were double-checking line 4 of form X3/J eight hours a day, you wouldn’t be champing at the bit, either. Help people know their contribution is meaningful by spreading the word about how everything works. Tell them. Show them. Remind them.

Not only must people know what they do, they must know what they don’t do. Don’t waste time and money duplicating effort. Let everyone know where responsibilities begin and end. If marketing chooses final product features, make sure product development knows so the groups don’t step on each others’ toes. While boundaries are easily set early on, make sure they’re emphasized at all times to keep a lid on turf battles.

Spread your reasoning to improve morale and buy-in

Everyone agrees salaries should be kept confidential. Why? Obviously, because people will compare. If they feel underpaid, they’ll complain, hurt morale, and maybe leave. Ditto for promotions.
If people think you promote and pay unfairly, everyone will assume you have the worst possible motives. The gossip mill will kick into overdrive, and morale will kick into underdrive. Help people understand why decisions are made and you can head off the worst of the problems.
Transparency can be risky! If salary information creates conflict, maybe the managers aren’t paying fairly. Maybe they really need an engineer when engineers are in great demand, so the company will pay the new engineer more than current engineers. Market reality? Yes. Fair? Of course not. In companies where salaries are public, these issues surface and get discussed. But these discussions should be based on sharing the real reasons and criteria behind salaries. People may not agree with the logic, but the undercurrent of betrayal and intrigue can vanish. It’s a tricky discussion. So much so that W. Edwards Deming, father of the quality movement, believes there should be no pay for performance, only flat salaries.
Personally, I like public salary data. It makes life harder for me, and that’s a good thing. I’m forced to justify salaries and make my expectations and pay policies crystal clear to everyone I hire. You may decide differently. Just make sure people understand the “why” behind your policy and they’ll be more likely to agree.

Spread reasoning about promotions to improve morale

Keeping promotions confidential may also be a disaster waiting to happen. When an individual gets promoted, everyone who wanted the job gets upset. They take that person’s promotion as a personal insult.
In an ideal world, everyone knows what’s expected of them. They knew where they still need to develop, and what the criteria are for the next promotion. But what happens when many people are qualified for one job? Face reality: We only choose one person over another because someone must be promoted. Bring up the possibility before it happens and you might head off a rebellion. If you wait until the promotion is announced, your hands are tied and everyone else has an unpleasant shock.
We don’t live in an ideal world. Sometimes we offer a promotion to keep an essential employee. Or a merger eliminates a redundant product line, and we must promote that project’s members to entice them to stay. Depending on your culture, these situations may be discussable, or not. The key is to share the reasoning and gain buy-in on the process behind promotions before promotions happen.

Share knowledge about critical events to preserve trust

Some business events change everyone’s lives. Layoffs, mergers, acquisitions, and C-level changes make an entire organization’s life uncertain. Uncertainty breeds fear. Fear breeds suspicion—and people will be suspicious of you, of “them,” and of everyone they suspect of being a mastermind behind the disruptive event.
Share knowledge about such events long before the rumor mill takes over. The rumor mill makes circumstances more dire than they really are. The rumor mill reinforces people’s wildest nightmares, and ensures any momentary comfort is properly interrupted by fear, uncertainty, and doubt. “Sure, management says your group will survive, but I hear AcquisitionCo already has a competing group. But you’ll survive the cut. Probably…”
Open discussion can head off the worst fears. Sometimes, details must be kept confidential. Sometimes, you actually don’t have the answers. Say so. “We are in merger talks with XYZ Co. We don’t yet know which groups will stay and which will go.” As long as you’re telling the truth, people will trust you. They’ll still be stressed out over the uncertainty, but you can offer them the certainty of knowing where you are. And that will preserve trust.

Keep a firm knowledge boundary at the company walls

Though information is your company’s lifeblood, you need to keep it inside your walls. Information about critical customers, mergers, and reorgs can jeopardize success if leaked to competitors or the media. Steep your culture in information sharing, and have people place a premium on confidentiality. Tell everyone what must be kept secret, and make sure they know what that means. Yes, it’s breaking confidentiality to tell your best friend, even if he crosses his heart and swears not to tell.

Information keeps people going. It helps people do their jobs, it feeds morale, and it lets everyone bring their full creativity towards common goals, rather than acting randomly. Share strategy, the “hows” and “whys” of how the organization works, and address uncertainty around major events. The goal is always to get everyone thinking together around creating the best results. Confidentiality has a place, but the question “what should be kept confidential?” has an important complement: “what must we share to become a breakthrough organization?”

© 2005 by Stever Robbins. All rights reserved in all media.

Productivity Means Working Smarter, Not Longer

Workers in the United States put in more hours at work and take fewer vacation days than those in most industrialized countries. But the U.S isn’t the most productive country in the world. When it comes to full productivity, according to an article in The Economist, France wins, working only forty hours a week with lots of vacation. Conversations with clients and friends suggest we’re working hard, but, well, stupidly. We’re busy, but our important priorities are falling by the wayside as we work hard when we should be working smart.
Working smart means getting the same results in less time. To do that, you must change how you work. You’ll get the most by changing your speed, increasing focus, and organizing to do things in parallel.

Start with your eyes open

Before you read on, I must warn you: Working smart is risky. If you work smart, you’ll have more free time. That means more leisure, shorter work hours, or . . . more work. If you use the free time to take on more commitments, you’re just as busy as before, but now you are so tightly scheduled that a slip in one project can cascade to many more projects. Happiness happens when productivity enables a higher-quality life, not frantic overachievement.
Right now, we get more productive by working longer. But how about working faster? To work faster, you’ll have to get into the zone. In the zone, you’re running a marathon. You bring your full focus to one task and build momentum until you’re producing results like nobody’s business.
Key to entering the zone is eliminating distraction. Your major distractions—let me guess—are e-mail, telephone, visitors, and yourself. One of my clients, a high-tech CEO, blocks out four hours each day for focus time. He closes his door, forwards the phone to voice-mail, and starts working to build up his rhythm. He rarely works the entire four hours, but by having the time blocked out, he’s sure to get a couple of hours of solid work under his belt. And without distractions, he can spend time doing big-picture thinking, instead of being pulled into details. After five years, he considers this one of the best habits he’s ever developed.
Your biggest distractions will come from you, though. You’ll multitask. And sadly, you’ll believe you’re getting more done as you do. Face reality: People are less productive when multitasking, and that’s been shown in many studies over the last few years—check out “Juggling Too Many Tasks Could Make You Stupid” by Sue Shellenbarger in the Wall Street Journal, March 1, 2003. We feel busy, but most of that busy-ness is spent switching from task to task, not making forward progress on any one task.

Increase focus

If you’re like me, you hardly ever procrastinate—except for the really important stuff. The rubber bands get dutifully sorted by size, but that client proposal? Not so much. Another way to work smarter is by distinguishing busy from productive. Oh, we’re busy, and we feel productive, but we’re only productive if we’re producing the results that are most important to moving the company forward.
E-mail is a great way to waste time feeling productive. And we get so much of it, so surely those two hours a day reading and replying is time well spent. But if you spend two hours of an eight-hour workday on e-mail, that’s 25 percent of your time. Unless that 25 percent of your time is producing at least 25 percent of your total income, it’s a low-value-added activity, no matter how many one-shot, ad hoc contracts you get that way.
The same applies to any activity. The 80/20 rule says that 80 percent of your results come from just 20 percent of your efforts. Companies find most profits come from a few customers. And you’ll find most of your output comes from a few of your tasks. So what? Well, look at the math. If you double the time you spend on real-output-producing activities and stop doing the others, you’ll double your output and spend 60 percent less time! If you started with a ten-hour workday, you’ll get twice as much done, working just four hours.
Consider Nancy. Nancy is a self-employed sales trainer. In a typical day, she might write her electronic newsletter, deliver a one-hour training, make a dozen prospect calls, categorize her receipts, and straighten her office. These all must get done, yet only delivering the training and making prospect calls directly bring in business. Nancy’s hidden productivity opportunity comes in making more prospecting calls, and spending less time categorizing receipts. In fact, she can hire a bookkeeper for a year with the extra money she makes from one additional sale.
Once you’re concentrating on your high-output work, you can get another boost by streamlining. If Nancy gets 10 percent better at prospecting, that adds more to her bottom line than anything she can do in other areas.

Say no

My favorite 80/20 principle is saying “no.” Most of us take on more than we can handle. Then our companies lay off 30 percent of the work force and expect the same output from the survivors. Our overwork gets compounded by dumb high-level decision making.
If you’re working at capacity, say “no” to that new client. If someone proposes a project that will fall in 80 percent-work-for-20 percent-results category, just say “no.” Face facts, my friend: There’s a limit to how much you can do. You can manage that limit and do things well, or you can ignore the limit and do a lousy job on everything. The choice is yours.

Work in parallel, but don’t multitask

When you multitask, you do many things at once. Bad idea. But you can find ways to arrange work so many things are happening at once. Good idea. If you are collaborating on a report and writing a marketing plan, you could write the plan and then work on the report. But look closely! Your colleague must review the report. So first draft your report and send it to your colleague. While she’s reviewing, you get to work on the marketing plan. Work moves forward on both at the same time.
While we all work this way to some degree, a little thought can find golden opportunities for parallelism. Delegation is a great tool here. When you delegate a task, it keeps moving while you’re working on something else. Just make sure you are delegating to someone with the time, tools, and resources to do the job. Otherwise, you’ll find the task coming back to bite you.
Another great source of time delays is when something’s being produced or shipped. Will your prospectus be going to the printer? Great! Use that time to hammer through your high-leverage tasks. The product is en route to your customer? That means more time for you to do other things. But if you putter around with low-priority tasks until you ship last minute via Federal Express, you lose the chance to work in parallel.

Combine and think

You can get very creative in how you use these principles. A partner in a new private equity firm wanted to buy and run a company. He realized he would say “no” 99 percent of the time, and “yes” only once or twice. To speed things along, he got very clear on the criteria to disqualify a deal as quickly as possible. He said “no” a whole lot. His ability to quickly weed out the duds ultimately led to a deal that’s showing gains of $170 million in thirteen months. If he hadn’t streamlined his low-leverage activity (saying “no”) so he could reach his high-leverage “yes,” he would likely have invested in one of his earlier, not-so-great deals.
Have you noticed a pattern? Working faster, identifying your 80/20 opportunities, and using opportunities for parallelism all take thought and planning before you reap the rewards.
So your highest-leverage activity is taking regular time to reexamine and tweak how you work. This year, I’m spending a half-day every two weeks to build a life and business that are productive. And to me, productivity means producing maximum happiness for me, my family, and friends. I entreat you to do the same. Give it a shot. You’ll be happier, you’ll get more done, and you’ll get to see your kids for dinner. And that’s what I call working smart.

Understand What Motivates Your Boss

Letters from last month’s column Productivity Means Working Smarter, Not Longer have been gratifying and surprising. Most unexpected was a theme I heard over and over: “My manager won’t let me work smart. What do I do?” That’s a real problem. Let’s start by facing reality: In larger companies, your personal success doesn’t necessarily depend on doing what’s best for business.
Long-time readers will know your bosses should be setting direction, giving feedback, and helping you tap your internal motivation—but most don’t. So take charge of yourself, face the reality of organizational life, and do what it takes to get your needs met.

You’re there for the cash

Why do you go to work? If you’re one of the lucky few, your work ignites your passion. It challenges you. It lets you accomplish what you find most worthwhile, provides community, and helps you contribute in a meaningful way. You’d keep working even if you won the lottery. Chances are, that’s not you. Even if your job does some of that, you wouldn’t do it if it weren’t for the paycheck. That’s fine. Almost everyone works for the money. So face that. Roll it around in your brain for a few minutes. Repeat after me: At the end of the day, even if you enjoy your job, you’re there to get paid. So “working smart” means working in whatever way gets you paid.
Understand first that people decide what you get paid.
You’ve heard managers say they’ll heap riches on those who do a good job. Ignore their words; watch their actions. Who do they really reward? Why? Mostly, we reward those who meet our needs, first and foremost. If you know what your managers really want, you can meet their needs while meeting the needs of the business. The late Harvard psychology professor David McClelland had an easy framework you can use.
McClelland said motivation comes in three flavors: power, affiliation, and achievement. Power People want things to happen their way. Affiliation People want to be popular and liked. And Achievement People want results. We’re all part power, part affiliation, and part achievement.
Take Mary. Mary wakes up thinking, “What can I do today?” Her day isn’t complete unless she finishes something, preferably working at least a few hours with others. She tells her employees the outcomes she wants and lets them figure out the “how.” That makes Mary about 60 percent achievement, 30 percent affiliation, and 10 percent power.
Interestingly, we are taught that American business is all about achievement; it’s all that matters. When we talk “productivity,” “efficiency,” “goal-setting,” we’re swimming in achievement language. We set achievement goals and base bonuses on achievement measures. But guess what—people don’t actually behave that way, as your letters clearly show. They’re also driven by power and affiliation. “Working smart” means getting results, but even more, it means satisfying your boss’s needs for power and affiliation as well.

Manage your boss’s real needs

If your boss wants you to get results, my advice on “working smart” holds. Get stuff done. Measure what you get done. Discuss the measures with your boss. Do, do, do. Your boss will be thrilled that by working smart, you can get more stuff done in less time. Then go home early, and have a life.
If your bosses want power, they want things done their way. Like bureaucrats, Power bosses often work this way. Following procedure and doing things the right way is more important than doing the right things.
Your job for a Power boss is helping her empire-build and/or helping her get things done her way. Be careful, though. Your boss may be bad at figuring out what needs to be done. So even if she’s getting her way, her way just might hurt the business.
You often find this power game happening when a new executive arrives to take over the show. They axe old projects and start their own. But if the outgoing exec was doing great, maybe no changes need to be made. To an incoming Power Person, this won’t do. They must change things simply to have the organization reflect their desires.
An affiliation-oriented boss wants to be homecoming king. He wants to be liked. Your job becomes helping smooth out relationships, being friendly with your boss, and helping him manage the people relationships. Emotional intelligence helps you meet the needs of an Affiliation boss.
When you hear “we’re one, big happy family,” that’s affiliation talking. Affiliation puts relationships first. I like that; relationships bind organizations together. But affiliation can go too far. Keeping incompetents in powerful positions just because they’re friends may honor relationships but tank the company. Even though your boss may not value it as much, make sure the work still gets done so you have someplace to work come next year.

Work smart by balancing all needs

All this comes back to working smart. If you’re trying to work smart and your boss says sorting paper clips is more important than crafting a distribution strategy, you need to know what’s happening inside your boss’s head and find the real motivation. Is your boss usually an achievement junkie? Then maybe she has a real reason paper clips are important. Talk to your boss. Make sure you both understand and agree on priorities, based on what it will take to get the job done.
If you have a Power boss, she may be more concerned with having you sort paper clips her way than doing your job your way. You need to choose to own the business priorities yourself. Figure out those priorities and ask your boss how you can meet them. Since your boss needs to dictate the “how,” you choose the right “what.”
The affiliation-oriented boss may have relationship concerns. “We can’t alienate our existing distributors. They’ve been with us for years! Joe and I go golfing every Wednesday.” Here, you must factor the relationships into account. Approach your boss with a positive attitude and make sure you approach your distribution with the relationship goals in mind as well.

Line up your compensation

Even though you’ll meet your boss’s motivational style, you still need to get paid. Socially, we rarely acknowledge power and affiliation goals out loud. Those goals are considered unprofessional, even though they drive so many of us. So you need to frame your job in terms of achievement goals that will get you paid, while making it clear that you’ll meet your boss’s power and affiliation needs along the way. Trust me—as long as you’re helping a power-oriented boss expand their empire, you’ll be able to find a meeting of the minds about what you need to do to get paid and move ahead.
Notice that I’ve said very little about meeting the organization’s needs. That’s because only an executive who understands the link between their own needs and the organization’s needs will value your attempts to do the right thing for the business. In the final analysis, it isn’t between you and the company; it’s between you and the people who will promote and pay you.
That group consists of more than just your boss. Your boss’s boss and other senior managers may be watching. Your Power boss may report to an Achievement executive. If your efforts are visible to the exec, helping your boss achieve in a way that her boss recognizes might be your best strategy.

You can’t have it all

At this point, you might be thinking that with all this strategizing about satisfying the three needs of management, it will be a miracle if you can juggle it all. Welcome to organizational life. If you have family or community needs, you can toss those into the mix. (This balancing act drives some people to self-employment. It was sure a factor when I set out on my own.)
The bad news is that you can’t satisfy your needs, your boss’s, and your organization’s. After all, it’s in the organization’s best interest for you to forgo a raise while working an extra ten hours a week. You’ll almost certainly need to sacrifice something. But the good news is that it’s your choice. Choose wisely

Thinking Outside Your Beliefs

I’ll bet I know why you’re reading this: You want the secret of success. And today, I plan to deliver. But the secret isn’t what you think. It’s not a practice, business model, or trend. Those are all just by-products of the real secret. All the “best practices” in the world won’t bring you results unless you understand what really drives success. What is it? Simple: belief.

Beliefs are where it all starts—they determine everything. Beliefs about what’s possible guide the goals you’ll set. Beliefs about human nature guide whom you hire, how you pay them, and how you promote them. Beliefs about the future have an impact on your strategy. In short, your beliefs become policies that become results. As much as we love to think we’re logical, beliefs don’t come from logic. Beliefs aren’t about what’s true; they’re about what we happen to absorb from family, friends, and culture. When I was seven, I was happily singing away when my dad told me to plan on a different career choice. Wham! For thirty years I believed I couldn’t sing. (Six months with a voice teacher revealed a very nice singing voice, thank you very much. Who knew? Not my dad.)

So-called conventional wisdom is just beliefs. Everyone knows this is true, and no one questions it. Growth is good. Sure it is. I always love hearing Warren Buffett discuss See’s Candies, a business that funded some of his early acquisitions. Warren is keenly aware that See’s has a natural limit to how big it can get without hurting its business. So he lets it stay small (small by his standards). As the second richest man in the world, his beliefs about growth catch my eye.

(Note the hidden belief there? Do you believe being rich means someone is smarter, or that their opinions are worth listening to? That’s just a belief. It could be wrong.)

Beliefs are sticky. Once you have a belief, you’ll interpret the world to match the belief. You’ll throw away or discount evidence against the belief. Just listen to any political debate. When data supports a point of view, the proponents leap. When data doesn’t, they try to discredit the data. It’s the belief driving, not reality.

Drive your business by driving your beliefs

If beliefs drive everything else, you owe it to yourself to know your own beliefs and choose them carefully. You just need to decide what to believe and then use the real belief-creating methods to drive the belief home. Oddly, you don’t have to choose beliefs that correspond to reality. You can choose any beliefs at all, as long as they drive you to create the world you want to create. For example, you can believe people basically want to show up and do a good job. If you do, you’ll create structures and systems that support people doing so. In turn, people will show up and do a good job. The belief becomes a self-fulfilling prophecy.

Next time you study the people you admire, ignore the details of what they think made the difference in their success. Instead, listen for their beliefs. When you see a company succeed by having dual career tracks for managers and scientists, the key isn’t so much the specific program. Try on the belief that there are multiple forms of excellence and you should offer multiple forms of success to celebrate them all. That underlying belief may well lead to more innovation than just dual career tracks.

Old beliefs get in the way

Even if you identify great new beliefs, your existing beliefs will fight back. You might decide to believe that organic, self-funded growth is the healthiest. Yet your dot-com-fueled fantasies of Google’s IPO keep insisting at the back of your mind that high-growth, high-profile is the path to a great company. Your old beliefs put up a formidable roadblock to the new.

When you start fighting yourself or saying, “Yes, but . . . ,” congratulate yourself! You’ve found a limiting belief. If you preface it by saying, “Of course, it’s human nature that . . .” or “Everybody knows . . . ,” then you know you’ve found a really powerful one.

So kill it. Mull your conventional wisdom over in your mind, and start taunting it. “Nyah nyah nyah nyah nyah. You’re a limiting belief. Get lost!” If you have fun with your belief, you actually weaken its hold. Slowly start playing “what if” and make them wilder and wilder. You’ll find yourself slipping outside the box of your own thinking.

Want some good ones to start with? Try challenging some of my favorite conventional wisdoms:

  • the goal of business is to make money for shareholders
  • growth is good
  • quarterly results matter
  • the size of my office matters
  • pay should be related to performance

people are our most important asset (if you’re in Houston, air conditioning is your most important asset, and don’t you forget it!)

Use emotion and selective attention to solidify the new belief. Remember that logic is the quickest way not to change a belief. Beliefs, like significant others, are impervious to logic. So go straight for emotion.

Contemplate something you believe is true. Notice the emotions you feel, “rightness,” or a confidence. And now hold that feeling while you start repeating your new belief to yourself. You literally want to start transferring your feelings of certainty to the new belief.

But feeling isn’t enough! You also have to train yourself to filter reality, just like your current beliefs filter reality. So start reviewing in your mind every example you can think of where your new belief held. If you’re adopting the belief, “we can find ways to partner with competitors,” start searching for every example you can find where competitors have partnered. For examples, read Co-opetition. Meditate on Microsoft buying a hundred-million-dollar chunk of Apple as the latter struggled for growth. Think about research joint ventures like the MIT Media Lab, where all partners pony up the bucks, and all share the results.

When you come across a counter-example, simply ignore it. “Gee,” you think, “my dad did business with a competitor and got wiped out.” Forget Dad’s two decades of bankruptcy and depression. Just focus on the times when partnering worked. Remember, you’re building a castle in the sky here. This isn’t about accuracy, it’s about training your emotions to act differently.

It’s OK to have an unreal belief—your current beliefs are just as unreal, only in the other direction. Remember: Beliefs just act as filters that help you direct behavior; they’re not about what’s real. You’re adopting beliefs because they will lead you to do different things, build different structures, and get different results than your current beliefs.

Regardless of belief, you still need a high-quality decision-making process. Making decisions should include a thoughtful phase where you leave beliefs behind and bring in data, real-world considerations, and lots of alternative viewpoints. That’s when you have the chance to avoid Dad’s fate, while still getting the benefits from “co-opetitive” innovations. You take reality into account in your decision-making process, not in your underlying beliefs.

There is a lot more to beliefs. They form the box that everyone seems to want to think outside of. They turn into organizational behavior, and they also have a deep impact on your own actions, your feelings, your family, and your culture. They’re one of the most powerful forces I know, and we’ve just scratched the surface here. I will be discussing beliefs on my blog and in my newsletter in weeks to come. Because the more you design your beliefs, the more you can create the results that you want in the world. Or at least, that’s my belief