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CEO Epic Fail: Have a Blueprint BEFORE You Swing the Hammer

CEO Epic Fail: Have a Blueprint BEFORE You Swing the Hammer

Have you ever noticed how a newly hired CEO often starts his/her tenure with a BANG!  Making all sorts of immediate changes – whether it’s replacing the entire leadership team, reorganizing, initiating a major acquisition or spinning off a business unit?   One thing that is a hallmark of new CEOs is…change! And this creates great tension and, often chaos, within the organization.  Yet many of these CEOs, after 3-5 years, quietly disappear…leaving the organization different, but not necessarily better, than they found it.

I used to puzzle over this as I observed it over and over – at companies, at school districts, at large non-profits.  Why would someone create such chaos and stress, and then just leave?  That’s unconscionable!

Over time, I’ve come to understand that they aren’t evil and they don’t do it on purpose.  Most of these CEOs arrive on the job with the best of intentions.  And they didn’t intend to create a mess and leave.

But they feel a lot of pressure to show immediate results.  So they often rely upon an action they’ve successfully used elsewhere to try and effect immediate change – whether their favorite go-to action is reorganization, an acquisition, or draconian cost-cutting.  They immediately implement this action and the staff straps themselves into their office chairs and braces for impact of sudden, and sometimes violent, change.

In laymen’s terms:  When you have is a hammer, everything looks like a nail.

And yes, sometimes the action does produce short-term results.  But then what?  Often the CEO seems to fizzle out – they don’t have any more big ideas and can’t seem to make any more progress in improving organizational results.  Or maybe the action they chose didn’t even produce the desired effect, at all.  Either way, they slowly disengage and…leave.  The staff cheer.  And then brace for impact of the next CEO.  It’s a dreadful cycle.

Yet there is hope.  There are CEOs who do achieve tremendous long-term results and who command the greatest respect (and devotion) from their employees, year over year.   I believe one of the secrets is that these CEOs don’t immediately reach for their “go-to hammer”.  In fact, they don’t actually believe they have all the answers.  And they rarely give orders for immediate high-impact action upon arrival (unless, of course, the organization is a breath away from failure when they hire on).

These truly fearless leaders enable and empower their staff to be part of their TEAM.  They are able to articulate their long-term goals for the organization and lay out a blueprint.  And they LEAD the organization in such a way that staff is eager to help achieve the organization’s long-term goals.  Sure, sometimes this requires some difficult or stressful actions – reorganization, replacing leadership team members, draconian cost-cutting, spin-offs and acquisitions.  But the difference is that these successful CEOs do a fantastic job of communicating the big picture and of including staff in the conversations (and sometimes in the decisions) about the future of the organization.  So, when the tough decisions ARE made – people understand and feel respected.

We’ve been privileged to watch some really successful CEOs achieve results and earn the respect and loyalty of their staff – by using a strategic blueprint.  

Visionary Leaders: What’s Their Secret?

Visionary Leaders: What’s Their Secret?

An executive once asked me a question that launched me on a 4-year quest for an answer.  We were discussing examples of visionary leaders who led their organizations to great heights.  He looked at me with desperation in his eyes and said, “HOW do visionary leaders think of this stuff?  I’m not Steve Jobs or Henry Ford.  I have no brilliant ideas.”  

My only response, at the time, was “I don’t know…our process just works” and to give him some real client examples.   But it bugged me that I couldn’t explain exactly HOW it works.

As an engineer, I am driven to understand how things work…and thus began the 4 year quest.  I started paying attention to when and how that “flash of visionary inspiration” happens when we work with consulting clients.

And my quest to understand HOW the process works led me to a variety of studies in strategy, innovation, neuroscience, leadership, psychology, business history, and military history.  Along the way, I discovered that there are actually TWO definitions of “strategy”1.   But most of us, are only familiar with one!  Did you know that?  I was stunned.

In the 1830’s, the definition of strategy “lost” a key component when two strategy books were written based on the successes of Napoleon.  The first was written by a German, Clausewitz, and this dense, hard-to-read tome carried forward the full definition of strategy from the earliest thinkers on the topic of strategy, from Sun Tzu forward.  The second book, written in French by Jomini, was much easier for readers to understand.  But Jomini’s book left out a portion of what Clausewitz and all prior writers had included in their definition of strategy.

Fast forward from 1830 and you’ll see that military strategists relied upon Jomini’s writings…and business strategy concepts evolved from military strategy.  Consequently, the definition of strategy that most of us are familiar with is actually only a PARTIAL definition.   Today, we define strategy as “how to get from Point A to Point B.”

The missing component of strategy, which was dropped by Jomini in the 1830’s, is:  How to determine the strategically unique “Point B” in the first place – not just choosing an obvious “Point B” that others in your industry are likely to choose.   This strategic inspiration is what we associate with visionary leaders.

I know that the Institute’s strategic planning process is unique because we (admittedly unknowingly) have always incorporated the FULL definition of strategy – our clients regularly have strategic insights regarding “Point B” and then we develop a strategy to get from Point A to Point B.  But to understand HOW our process facilitates the mysterious “inspiration” part of strategic visioning, I had to study further.

Neuroscience and writers in the field of innovation tell us that creative ideas are nothing more than the brain combining bits of already known information in a new way.  If you look at scientific discovery, the arts, history…you see this is true.  In my study of innovation, I’ve yet to see an example of a truly original idea.  In reality, ideas build upon pre-existing information and combine things in new ways.

By way of example: Steve Jobs had a spark of inspiration when he visited Xerox and they showed him their research into GUI (Graphical User Interface) and he imagined combining this with a desktop computer. Henry Ford had a spark of inspiration when he visited an animal processing plant and imagined reversing the “animal disassembly line” and, instead, creating a moving assembly line to build an automobile.

I’ve been privy to watch flashes of inspiration happen when a client combines things in a new way and realizes “there is our Point B!”  So HOW, exactly, do we incubate strategic visioning?   And that’s when I had my own “aha!” moment.  To “incubate” means to ensure the right conditions exist for something to take form.  And THAT’S the secret!

So what are these conditions?  First, the brain needs to contain lots of information and ideas to have fodder for new combinations.   The Institute’s proprietary strategic planning process stocks and stimulates the brain via the strategic thinking exercises we lead the client to perform, as well as via our use of diverse teams (which brings more information, facts, and ideas into the process).  The more you have to work with, the more likely you are to find an innovative combination.

Second, one’s mind must relax.  Ever notice how your best ideas come when your mind is calm?  In the shower?  While jogging? While you are half asleep?  That’s when your brain is free to combine things in new and innovative ways.  Our workshops are conducted in stress-free locations. And we simply lead the team, step by step, through various strategic thinking and decision-making exercises in a relaxed environment.  There is no pressure or expectations for the leadership team to come up with something brilliant.  We simply work through our proven process.

So, the answer that I have come to, after four long years, is that you need to create the right conditions to be “visionary”.  A leader can prepare him/herself by constantly learning.  Read.  Study.  Attend seminars.  Network.  Get out and visit other companies.  Steve Jobs visited Xerox.  Henry Ford visited the animal processing plant.  Both had numerous outside interests.  The more you learn and experience, the more information you will have in your head.   Then, relax.  Free your mind and let inspiration find YOU.

Furthermore, I came to realize that a good leader doesn’t have to have all the answers. The Institute’s inclusive process actually takes the burden off of the leader and leverages the innovation potential throughout the organization.  When all staff understand the big picture, this information gets combined with everything the staff knows and has experienced….and creative ideas spark!    At one client, the factory union steward is the individual who actually had the eureka moment regarding the future of the company.

If you want us to lead your team through the process of finding your strategically unique “Point B”, contact us about our strategic consulting services.

1In the spirit of continuous learning, I also highly recommend one of the sources that helped provide the final missing link in my study on this topic:  William Duggan’s book, Strategic Intuition: The Creative Spark in Human Achievement.

Wandering in Circles: The Shocking Truth about How Some Companies Choose Their Strategy

Wandering in Circles: The Shocking Truth about How Some Companies Choose Their Strategy

I received a text message from a friend today:  “My brother-in-law needs to build a balanced scorecard.  Where can he find examples?” ~Sigh~ That is like asking me, “My brother-in-law needs to get from New York to Texas.  Where can he find any old Google Map screenshots?”  The crux of the matter is: What is the real question here? Is he asking to learn to properly build a strategic balanced scorecard that will be used to help an organization transform, grow, or thrive?  Or is he asking to see what plan others in similar companies have implemented in order to transform, grow, or thrive in their unique situation?  These are fundamentally different questions.  Unfortunately, the questioner usually has no idea of the difference. Hence, the classic mistake.  Thinking you can look at enough examples and construct your own strategic balanced scorecard by copying and pasting.  This is ludicrous.   It’s like picking up a random phone that is open to Google Maps and blindly following the blue dot to wherever the prior owner programmed it to go. In reality, you only need to see one example of a strategic balanced scorecard to learn how to READ and USE one.  The STRUCTURE of the scorecard, just like the STRUCTURE of Google Maps, is consistent.   The CONTENT of scorecards are unique, just like the CONTENT of directions mapping is unique from request to request.  The directions depend on where you are now, where you want to go, and your desired mode of transportation.  If you can read one map, you can read them all.  If you can read one scorecard, you can read them all.  But each strategic balanced scorecard will take a unique organization from a unique current state to a unique future state. Academic Stress and Achievement Therefore, seeing example after example will not help you CREATE a usable scorecard to achieve the results YOU desire.   Knowing HOW to create the elements of the scorecard (similar to knowing how to tell Google Maps you want to go from Point A to Point B using a car) …that’s what is critical. To learn how to create a strategic balanced scorecard (and see some examples!), we invite you to explore The Institute Way:  Simplify Strategic Planning & Management with the Balanced Scorecard. Or contact us and let us show you how.
3 Tips for Shark Tank: Would YOUR Business Attract a Shark?

3 Tips for Shark Tank: Would YOUR Business Attract a Shark?

I love to watch Shark Tank and I’ve been known to purchase a product that the Sharks reject.

So, what was the problem?  Why don’t the Sharks bite on a good product?  Because it’s not about the product.  It’s about the business.

I’ve observed business owners make the same 3 missteps in Shark Tank over and over.  The owner is passionate about his/her product.  They BELIEVE in it.  But…

1. Customer Value Proposition:  They cannot articulate what sort of customers they would attract and what it is about the product or its usage that would ATTRACT those customers as compared to the competition.  This is fundamental.  And if you listen closely, Mark Cuban will usually ask questions about this.  Skipping this step is a mistake.

2. Knowing the Numbers:  When the Sharks ask questions about customer base, sales, cost of production, market share, and such, they are assessing the current results of the business…not wishful thinking.  Business valuation is based on some combination of current results.

3. Growth Strategy:  The Sharks will ask a lot of questions as they look for drivers of future performance.  They are looking for a growth strategy.

And here is where things usually break down in the Tank.  The owner cannot clearly articulate a viable strategy for reaching customers and growing the company to serve them.  They cannot explain how the investment is connected to future results.

Sometimes a Shark has prior experience with a similar company and feels confident in his/her ability to identify the drivers after the investment.  Other times, the Sharks give up because they cannot perceive a strategy to grow the company.

I’m waiting for the day when an owner shows up in the Tank with a plan similar to one that a start-up client of ours used to rapidly obtain investment funding.  By laying out a clear picture of his growth objectives and how he intended achieve them…using a strategy map that connected the dots between drivers and results, this client laid out exactly how he would use the money and why.  For example: To build staff capacity needed to grow, he needed to improve the knowledge and skills of his employees.  He specifically wanted $10,000 to fund some specific training.  Increasing capacity via his employee skills would drive a key process objective: to enhance vendor relationships.  To further improve vendor relationships, the client asked for $15,000 to build a vendor database which would also differentiate him from the competition.  And, improved vendor relations would increase efficiency in related processes which would free up staff to serve a larger client base.  To grow the client base, he asked for $10,000 for specific marketing activities.  And so on…it was all connected: from investments through resultant profit projections.

The client called us to SHOUT, “We got the $250,000 funding!  No questions asked!”  Amazing?

Not really.  They used the proper tools to connect the dots and communicate their plan and to attract the investment.

So, would YOUR business attract a Shark?  Or would you be rejected in the Tank?

To learn how to create a plan that is clear and easy to communicate…and to execute…we invite you to explore The Institute Way:  Simplify Strategic Planning & Management with the Balanced Scorecard.

How a Benchwarmer Won the Game

How a Benchwarmer Won the Game

A rarely-used Major League Baseball backup player who spent the entire game (and most of the season) on the bench made a game-winning play…from the bench.  Yes, you read that correctly. It wasn’t a highly paid player on the field.  The game was won by someone sitting on the bench.  How is this possible?  

Sitting in the dugout, Detroit Tiger Hernan Perez spotted that a Kansas City Royals runner failed to tag 3rd base on a crucial play. That set off a sequence that resulted in an out instead of the go-ahead score for Kansas City as Detroit beat the Royals 3-2.

”I have to give credit where credit is due,” Tigers manager Brad Ausmus said. ”Hernan Perez was the guy who initially noticed it, sitting on the bench watching the game.”  This was a rare and newsworthy event.

Perez understood the big picture and found a way to contribute to the win.  This focus on the big picture (the team was playing to win) is what we call strategic thinking.  He was paying attention to the game, not just to his primary job function to be mentally and physically ready in case the coach sent him into play.

By keeping his head up with his eyes on the game, he saw an error that could help his team achieve their goal of winning.  And he took action to call attention to it.  This action, from the bench, resulted in Detroit winning the game.

Similarly, every member of an organization has a unique vantage point – they may be positioned to see things that others don’t see. The question is, will they understand what the bigger picture meaning of what they see?  Will they take action?

Even those who are not direct contributors, those in support functions, need to understand the game plan of your business.  If they understand what you are trying to accomplish and how you intend to get there, they may surprise you with their ability to contribute to the achievement of your goals from their unique vantage point.

Do you struggle to help support staff feel involved in the “real business” of your organization? Do you ever wish you could get your employees to understand the big picture and independently take action to help you succeed toward long-term goals, no matter what their current job is?

To learn more about how to translate your strategy into something that is clear and easy to communicate in a way that employees can understand and effectively contribute to, we invite you to explore The Institute Way:  Simplify Strategic Planning & Management with the Balanced Scorecard.

Or contact us and let us show you how.

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