What do 181 CEO’s Agree On?

Purpose Matters

181 CEO’s signed a letter from the Business Roundtable last week, stating that purpose matters and shareholders are not the only stakeholders who should receive value from the endeavors of business.

They specifically note that there are 5 stakeholders they are accountable to – shareholders, employees, customers, communities and suppliers. Interestingly, as a young consultant, my firm used this framework for strategic planning with our clients back in the late 1980’s. By taking this more holistic view of who should benefit from the corporation, the purpose of the organization became more meaningful to everyone the organization touched.

We’ve spoken about purpose for years. It’s what gets people up in the morning. It’s what makes people put in the extra effort when it’s needed. It’s what makes us feel a part of something bigger.

Empirical research now supports the fact that purpose and profit go together. Research by Gloria Gartenburg and George Serafeim found that companies with high levels of purpose outperform the market by 5-7%. This finding, according to Gartenburg and Serafeim is on par with companies that have best-in-class governance and innovative capabilities.

According to Gartenburg and Serafeim just having a purpose is not enough. Success comes when:

  • Senior leadership has embedded that sense of purpose through the organization, especially at the middle manager level
  • There is strategic clarity throughout the organization about how to achieve that purpose

Purpose as a Core Tenet of Successful Change: These findings made me think about one of the critical elements of change I’ve been writing about for years, including recently in HBR Online and elsewhere. Clear, compelling purpose provides clear direction and ensures that everyone understands the “why “ of the change (i.e., the purpose), not just the what.

Today, organizations have to be able to change quickly. A natural outgrowth of rapid change is uncertainty and, at times, frustration that what we’re doing today flies in the face of what we did yesterday. However, if your organization has a clear sense of purpose and change is continually tied back to that purpose, uncertainty can be managed, and frustration minimized.

And when that purpose is not just aligned to shareholders but to the multiple stakeholders, the change will be meaningful in new ways. It will not just be a singular group who benefits. Rather it will have more meaning for the entire ecosystem of the organization.

Those organizations who establish a meaningful purpose and embed it in the culture of their leadership and their organization stand the best chance of thriving amid the chaos of constant change and upheaval in the world.

How Not to Lead Disruptive Change

A few weeks ago, I returned from an amazing family vacation that took us to Budapest, Venice and Rome. We decided to take a train from Budapest to Venice to take in the soaring beauty of the Alps as we made our way through Austria and northern Italy. And it was spectacular… until we reached our last stop in Austria. That’s when we got a first-hand lesson in how NOT to handle disruptive change.

Throughout Austria we had several 5 to 10-minute stops, with announcements made in German, Hungarian and English. We made what turned out to be our last stop in Austria in the beautiful city of Villach. The screen showed our usual 5-minute wait and then suddenly it changed to 45 minutes.

Soon an announcement was made, in German only. Slowly, groups of people began to get off the train sporadically. Not knowing what was going on, I finally found a train company information officer and he told me there had been a minor earthquake in northern Italy and all rail service was stopped indefinitely so tracks could be inspected. We were going to be bussed to either the station after the areas affected by the earthquake effected or all the way to Venice – they weren’t sure.

Eventually we made it to Venice, but the hours in between that conversation and our arrival were a great example of how not to lead change…

The leaders assumed everyone understood the message:  while most of the people on the train spoke German, a very large minority did not. While other announcements had been made in multiple languages, this critical one wasn’t. We found out from fellow travelers that he announcements, even in German, didn’t explain exactly when passengers should get off the train and where they should go to wait for the buses. Passengers were only able to get this information by taking the initiative to talk directly with individual company representatives.

Focus on the technical side; forget the people side:  there were a couple of coordinators from the train company in charge of arranging the buses, monitoring their arrival and getting us on board. Eventually there were 3 buses that arrived several minutes to an hour apart. We weren’t told where to wait for the busses or when they would be arriving. And we weren’t assigned in any way to a specific bus. After the second bus, someone asked ‘how long until the third?’ The coordinator answered “5 – 10 minutes.” His colleague then chimed in “or maybe 30.” In the 45 minutes until the third bus did arrive, they were on their phones in regular communication with the transportation company.  They simply didn’t communicate with any of the passengers.

Don’t tell those affected by the change how to move forward: We finally arrived on the outskirts of Venice about 3 hours later than anticipated. The bus stopped and we all got off. Only problem was, this wasn’t the normal train station stop for those going into Venice. The bus driver didn’t tell us this; another passenger did. When we all disembarked from the bus, we asked the driver where to go. He said to the footbridge. Only problem – the footbridge is closed at midnight. The bus driver then got into the bus and drove away leaving about 20 of us to figure out how we were supposed to get into Venice. In the distance we saw what looked like a ferry stop and we went there. Eventually, through trial and error, we all figured out which way to go.

Assign change leaders who don’t know that leading change is part of their job: The coordinators understood their role to be to get the busses arranged and ensure everyone got onto a bus. The bus drivers understood their jobs to be to drive us to Venice. No one had set expectations with them that they also needed to step up and lead – to inform us of the overall plan and how each step for the rest of our journey would work, to reassure us when the busses were taking much longer than anticipated, and to prepare us for the rest of our journey.

Disruption – of your industry, your company, your team – can happen with little advance warning. Understanding that leading change needs to be a skill set that can be called on at any time, is the only way you and your team will navigate it successfully. How well prepared are you to lead change?

Disruption, Anyone?

Google is getting into the gaming business. According to the Wall Street Journal, they’re launching with a cloud-based service, hardware component and separate controller. Google is set to disrupt another industry.

There are plenty of disrupters out there. Some are behemoths like Google or Amazon. Others seemingly rise from nowhere. And, no matter what our industry, disruption is a very real possibility. We can’t run from it. We can’t hide from it. We need to be ready for it.

How can you get ready? Or even better, how could you become the disrupter?

Keep in touch with new technology. It can be overwhelming because it changes so rapidly. That’s the exact reason we need to stay in touch with it. Join a tech-focused professional group. Check out tech blogs. Pay attention to the everchanging buzz words – AI, autonomous vehicles, blockchain – and then find out what they mean. And ask, ‘how could this impact the work we do and the value we provide to clients?’

Look outside your industry. Clients invariably ask me ‘what are other company’s like ours doing?’ It’s not a question of what other company’s like yours are doing, it’s what are other companies unlike yours doing? I don’t know the gaming industry but it’s quite possible gaming companies didn’t look at Google as a company ‘like ours.’ Have your team look outside, too.

Listen, really listen, to your customers. Don’t just ask how you can do what you do better or how to improve your product. Ask them what their problems are. Find out what they want to solve. It quite possibly will have nothing to do with what you are currently providing. The question is then, do we have an opportunity here? Your team is probably positioned even better than you are to ask these questions and see the opportunities. Make the asking part of their job.

Build space to experiment. With different perspectives added to your thinking, there should come new ideas. Give space and resources to experiment. Try out ideas on a small scale. Learn from the failures and build on the successes.

Disruption, almost by definition, is something you’re not prepared for. It can be a disaster for companies and individual careers alike… so you have to get prepared. So, before Google, the start-up around the corner or across the globe turns you and your company upside down, invest time and resources making yourself as disruption-proof as possible.

How is Your Ballast?

For Boston, the connection to the sea is inseparable from its history. The early economy was largely dependent on the captains who sailed the ocean and the materials they brought on their return. On journeys that took months, ships would invariably hit rough seas. To counteract being tossed about in the ocean, ships were loaded with ballast – often heavy stones, that were added to the hull to create greater stability.

Today’s business challenges can feel like those rough seas. And, as leaders we may need to provide ourselves and our teams with some ballast so that we push into the waves without capsizing. We also need to be aware of when it’s time to reduce our ballast so that we can skim along at a faster clip.

Manage your ballast effectively by:

Knowing your true north. Where are you going? Where is the organization going? What is the alignment? Answers to these questions will center you and provide a sense of stability because you know who you are.

Reminding yourself that you are resilient. We’ve all faced strong winds and rough seas before. And here we are on the other shore. What skills, capabilities and attitudes helped you? Would they be helpful now? Most likely at least some of them are applicable in the current situation. Keep them on the ship.

Questioning your assumptions. We all make assumptions about how something will work or what will be effective. Those assumptions can be outdated and not valid, or even more important, valuable anymore. Push back on those assumptions. Question their value in current situations. Before you hold onto them, test that they are still valid. If not, get rid of them and replace them with insights and information that will allow you to move along with the waves rather than fight them.

Making sure it’s balanced. If ballast is not balanced, it’s very difficult to steer the ship. It can pull you too much in one direction or the other. Your ballast needs to help you stay on course but remain agile enough to change and adapt. When innovation and change are required, if all your ballast is keeping you aligned to how we do things now, you’ll soon be off course.

Right now, take a quick assessment of your personal ballast. Are you managing it or is it managing it or is it managing you?

Learning as a Journey

A question many of us think about on a regular basis is ‘what do I need to do to continue to be successful?” The definition of success itself is very personal. If you’ve been successful up until now, it could be easy to assume that what made you successful in the past will work in the future. In reality, it’s uncertain what will make us successful in workplaces, markets, careers, and industries that are changing so rapidly.

Change has a way of doing that – creating uncertainty. What do we seek when we feel uncertain? A return to a comfortable degree of certainty again. Certainty helps us feel in control. News flash: at work, we’ll never have 100% certainty. That said, maybe rather than searching for certainty, we should ensure our relevancy.

There is a prescient article in the Wall Street Journal titled “I’m Still Under Construction; Six Tales of Lifelong Learning.” It profiles six very different individuals who are living the idea of life-long learning. It demonstrates that learning can happen in a wide variety of ways and that it pays off in big ways. If you read the article, you’ll see that learning didn’t create more certainty, but it gave them more opportunity and relevancy.

There are some predictions that 30% of today’s skills and knowledge will be obsolete in a few years. Overstated or not, this statistic represents the reality that we need to be thinking about how we are continually preparing ourselves for what’s next. Second news flash: learning isn’t a destination, it’s a journey.

Where is your journey going?

Am I Dressed for This?

Much of the country is experiencing record-breaking, bitter cold this winter.  And yet, some weeks, we’ve had snow storms on one day, with bright sunshine and 50 degrees the next.  In a few months, we’ll be experiencing heat and humidity.  The old saying goes ‘if you wait a minute, the weather will change.” As human beings, we readily adapt to these weather changes. We build a wardrobe for whatever the weather in our area brings – hot, cold, rain, snow, sun, etc. 
 
You could apply that old saying to what happens at work these days – wait a minute, and it will change. As I sat yesterday evening in front of the fire, I was thinking about what kind of wardrobe we are building for ourselves at work so that, when change happens, we have what’s needed to adapt. Are we building an athletic wardrobe so that when we need to reach  across silos we are comfortable and able to move easily?  Do we have our creative hat when we need to approach a challenge in a new and unique way?  Do we have our metaphorical heavy coat so we can get results even when things feel blustery? 

Too often we put on armor to protect ourselves from having to adapt and change.  Wouldn’t a wardrobe with a nice pair of shorts help us to be comfortable when things get heated?  Or a well-tailored coat for when we have to face a cold front?  Or a comfy pair of jeans for when we need to be ready to stretch and reach feel so much better?
 
What are you doing to not only broaden your work wardrobe, but to update it for what’s needed in 2019? How about your teams?  Are they stuck in a snowbank?

Hold Onto Your Hat

Happy new year!!  2018 is in the books and now we’re looking at 350+ new days ahead of us. What will 2019 bring? Hard to say with certainty. With that said, what are some experts saying may be ahead of us in the coming year? Let’s take a look:

Hello Generation Z: For the first time in 2019, Gen Z is entering the workforce in meaningful numbers. For the first time we’ll have 5 generations working side-by-side. What are Gen Z all about? According to Brené Brown, “My experience is that they lean in and lean hard. They are all very different people, but as a group I experience them as curious, hopeful, always learning, painfully attuned to the suffering in the world, and anxious to do something about it.”

AI and machine learning come to workforce management: According to TheWorkforce Institute at Kronos, AI and machine learning will finally be integrated into workforce management practices. It will lessen the burden of admin-heavy tasks for managers and provide predictive analytics to head-off potential issues. Managers will have more information for data-driven decision making and more time to lead. The question in my mind is, are managers prepared and equipped to lead?

Economic uncertainty causing angst: With the behavior of the stock market over the past month, the early signs of trade wars and some economists predicting recession, the economy seems to be full of uncertainty. With uncertainty comes doubt and fear. Even though the great recession started over a decade ago, the scars are still fresh for many.

Leaders will need to handle a potential downturn in ways that sustain trust and guard against over-reaction to any changes it brings. In any scenario, organizations will need to ensure they have the right talent focused on what adds the most value. Effective leadership will be essential. 

What do you think is going to be impacting you this year?

The Leadership Link to Sustained Excellence

Can your organization sustain performance excellence? Recently, McKinseyresearched the link between leadership and organizational health (i.e., the company’s ability to sustain exceptional performance over time). Key findings:

  • 80% of a company’s variance could be explained by the strength of leadership.
  • 57% of companies don’t think their training efforts are developing the leaders they need to meet their strategic priorities.

Too often, they note, leadership development focuses on bringing universal leadership capabilities to a limited number of individuals in the company. Why doesn’t this work? Change is constant. Decision-making needs to be decentralized. Impacts need to be achieved across the organization. Effective leadership needs to be local.

They suggest four principles that closely align with our approach to developing leaders who can thrive in high-change environments.

  • Focus on leadership behaviors most effective for driving performance.McKinsey identified 4 that account for as much as 89% of leadership effectiveness. One is focused on results. The other 3 on people.
  • Identify a critical mass of influencers so that change becomes self-sustaining. This is true for any change. You need to identify your key stakeholders and influencers and make a plan for engaging them.
  • Use neuroscience to create lasting change. Neuroscience helps explain why we resist change and what we can do to create change. It provides insight into motivation, decision making and influence. Leadership development needs to utilize these concepts to help leaders create highly effective and efficient leadership practices.
  • Integrate programs into broader organizational systems and measure impact. Leadership development can’t stand alone. It needs to be aligned to the strategy and integrated into how you hire, enable high performance, reward and recognize.

Leading change is now central to every leader’s role, and the organization’s success.  

It follows that leadership development and change leadership development should not be looked at as separate topics or processes. Change leadership should be fully integrated into training programs, but also into all leadership development strategies, plans and assignments. And every senior leader should be asking themselves:

How ready is my team to lead change?  

What are their change leadership strengths and weaknesses?  

Improve Your Global Mindset and Strategic Thinking

Recently I had the pleasure of talking with a Danish company at their annual meeting in Dubai. It reminded me that some of the most instructive client relationships I have (especially the long-term ones) are those that provide me with a global perspective. It also reminded me of this newsletter article I wrote several years ago…

Some of you may have heard the story of the truck stuck under the bridge and the dilemma of how to get it unstuck. If you don’t know it, I’ll share it at the end of this post.

I thought about that story at a recent professional meeting where the topic was developing a global mindset. All of the speakers had interesting perspectives to share and one in particular made a point that was particularly thought-provoking. His company’s research had shown that experiencing another culture had a significant impact on one’s strategic thinking. He further explained that “experiencing” a culture didn’t mean going there on vacation for a week or two.

It is immersive, longer-term experiences like ex pat assignments or managing global teams where you had to travel to work within their culture. The speaker noted that these assignments have this profound impact because they change your perspectives on the world, how it is organized and how it functions. These different perspectives allow you to be more nuanced in your thinking about how different parts of a whole interact, the variables that impact it, and the implications.

How, then, can someone stretch their perceptions and perspectives and develop their strategic thinking when working globally isn’t a possibility?

Seek out Projects That Involve Global Teams.  It’s not the same as working overseas, but working on projects with global teams is a great start. It will expose you to different ways of thinking, conversing, and decision-making. Regardless of your role, really listen to others.

Regularly interact with people in a different function or area of the company. Marketers and engineers don’t think alike. Operations folks think differently from researchers. See how someone different from you may be experiencing the same organization, issues, etc.

Interact with those outside your industry.  For years, benchmarking was the buzzword when you wanted to get a more strategic perspective and to understand the industry more broadly. The problem is that it is a closed-system approach. Biotechs benchmark other biotechs. Car manufacturers benchmark other car manufacturers. The perspective of someone in a totally different industry about your issue or situation will cause you to think about the variables and interactions more broadly, more strategically. It helps you see the forest for the trees. One of the things that made Steve Jobs so successful at product design was that he thought about products and perspectives he gained from things like digital animation architecture.

Hire people who are different from you. I hesitate to say hire for diversity because too often that is narrowly defined. In addition to the more commonly referenced and important diversity categories, we can hire for diversity of thought, experiences, and education. Also, the US has new populations from other cultures within the country that can be brought onto teams. So, if working globally isn’t possible, the US still has a rich population of people to choose from. Then, regularly ask those you’ve hired for perspective and input on the business issues you are working to address.

Thinking about your daily business interactions expansively will help you develop the broader perspective needed to think more strategically.

So, the story about the truck stuck under the bridge goes like this…  A truck was stuck under a bridge, backing up traffic. The police, fire and tow truck drivers were trying to figure out how to get it out, but they had no workable solution.  A little boy walked up and asked what was going on. The police officer explained the dilemma. The little boy looked at him and said. “Let the air out of the tires.”

Among other things, the story illustrates how important it is to look for and value unique perspectives, especially those outside your typical orbit. Something a more global perspective can provide us.

Bounce Back!

Resilience: The ability to recover quickly from difficulties; toughness

Resilience is key to the short and long-term success of our careers. Over the course of time, we are thrown curveballs that require us to bounce back and show our toughness. Here are 4 ideas for building resilience for yourself and your team:

  • Frame the Situation.  When a situation turns out badly or something negative impacts you, how do you think about it? Is it a blame game? Do you kick yourself for “doing something stupid?” Stop. In every situation multiple elements impact the outcome. While it’s important to consider your own role, look at the various other players and their roles in the setback. Don’t look at them to place blame, but to learn.
  • Ask Questions to Find Understanding.  After assessing what role various people or institutions or situations played, follow up with questions for yourself. What was controllable? What wasn’t? What lessons can I learn? What could be different next time?
  • Take Time. Sometimes, the curveball has some pretty significant impact. Be sure to set aside some time to work through the emotions. Unpack them, label them, and try to understand them.
  • Be Expansive. Resilient people mark the ending of any setback by moving forward. They acknowledge and attend to their feelings, but don’t wallow in self-pity or self-blame. They put what happened in it’s place and take steps to make new things happen. When one door closes, they open others.

If you think about a difficult experience as an opportunity instead of an obstacle you’re more likely to grow from the experience and more likely to bounce back quickly.

Here’s to resilience in a turbulent world!