So, What Do YOU Think?

How to get your people to engage with you.

In a recent interview with the New York Times, Bill Marriott, chairman of the Marriott Hotel Group, shared this useful piece of advice.  He explained that as a young officer in the US Navy he was responsible for the stewards who served in the officers’ wardroom.  New to his role, and being in a military organization he told them what to do.  They ignored him.  He ordered them.  They ignored him still.  He came to realize that, even though he was in the military he could not command people to follow him as a leader, they had to want to follow him. For them to follow him he had to engage them.

So what was the lesson from this?  It was four simple words – “What do you think?”

As a leader, by asking this, you are getting your ego out of the way.  Leaders cannot and do not have all the answers, nor do they know everything.  By asking people for their ideas, their input and their insights several things will happen: firstly, your people will see that you care about them and are interested in their opinion; secondly, you will learn something you did not know before; thirdly, you can make better and more informed decisions which your people can buy-in to as they have participated in the process  By engaging with others they can engage with you, but it starts with you reaching out first.

What do you think?

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

The 4 Foundations for High-Performance

The Four Components of Human Performance

There are four key components that need to be in place for people to perform, and for organisations to prosper.  What are they and what can we do to ensure they are in place? 

by Andrew Cooke, Growth & Profit Solutions Human Performance

Performance is about people, and people can be fickle.  Organisations are under pressure to do more with less; organisations are becoming flatter which, in turn, is extending the scope and responsibility of managers and leaders, increasing the number of reports and reducing the time that manager and leaders can spend with them.

So what do we need to do to ensure that we have the right building blocks in place so that people can perform effectively and efficiently?

Andrew’s Four Building Blocks

There are four building blocks which form the foundation for performance.

4 Components of Human Performance

1.  Desire to Work – people need to want to work.  It is not about just satisfying their monetary or security needs.  People want the opportunity to apply their skills and talents, to gain gratification from doing so, and to receive recognition for doing so.

2. Adequate Skills– if people have the desire but lack the necessary skills they will be unable to perform, they will be frustrated, and the organisation will be negatively impacted.  Certain skills are essential for success.  Employees may already have these skills; they may need to be trained in them, or to develop these skills experientially on the job.  At the same time, especially with “knowledge workers”, the necessary skills and expertise may erode or even become obsolete (how many rotary telephone repair people do you know?  Or typewrite repair experts?)

3. Right Attitude – if you hire nothing else, hire enthusiasm.  Hire energy, hire excitement, and hire passion.  These are not teachable.  You can teach people your content and the skills required. The adage, “hire for attitude, train for aptitude”, has never been truer.

4.  Right Behaviours– if people lack the right behaviours, even though they have the desire to work and the necessary skills, you will find poor performance. How many times have you gone out for a meal, which was excellent, but marred by slovenly, slow or disinterested service?  How are you clients experiencing your people? Behaviours have to match the job results expected.

Look at your organisation and ask yourself how are you doing in each of these areas?  Are you recruiting people with these four components from which you can build a foundation from which to build high-performance? Are there are weaknesses or gaps in your business, divisions or departments? Are these gaps areas which you can influence or are they areas which are in the domain of the employee?

All four components are required for human performance and measurement, but only some of them can be built by the employer, although all of them can be nurtured by the employer.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

The 5 Challenges Leaders Face

What are the top 5 challenges for leaders globally, and how can you deal with them?

by Andrew Cooke, Growth & Profit Solutions

Leaders are under increasing pressure having to deal with more, with less, whilst having to handle the 5 challenges of the modern business world.

This article looks at each of the five major challenges in turn and identifies the key strategies that leaders need to develop to meet these challenges and, in doing so, become great leaders in turn and to develop leaders within the business at all levels.

Andrew’s 5 Challenges for Leaders

1. Dealing with the New Business Reality

2. Paradoxes Moving from “Either/Or” to “And”

3.Restore Confidence & Trust

4. To Collaborate & Empower

5. Building Individual & Organizational Resilience

Challenge 1: Dealing with the New Business Reality

The world for leaders is changing, and the rate at which this is occurring is increasing exponentially whilst its effects are being seen, and compounded, in 4 different areas:

  1. Volatilitythe increasing rate, amount, and magnitude of change
  2. Uncertainty – the amount of unpredictability inherent in issues and events
  3. Complexitythe increasing amount of dependency and interac­tive effects between multiple factors and driver.
  4. Ambiguity the degree to which information, situa­tions, and events can be interpreted in multiple ways.

For further information on this see How to Manage Volatility, Uncertainty, Complexity and Ambiguity – Part 1

To deal with these factors, leaders need to develop on an integrated basis, the following:

  1. Vision – having a clear picture of the purpose of your business and where you are going.
  2. Understanding – the leader takes the time to stop, look and listen to what is happen, this is beyond their functional expertise and beyond just their business.
  3. Clarity – the leader needs to spend the time and effort in deliberately working to make sense of the chaos that exists.
  4. Agility – the ability to communicate openly across the organization and to move quickly to apply solutions, the rapid prototyping of ideas & actions to develop solutions.

For further information on this see How to Manage Volatility, Uncertainty, Complexity and Ambiguity – Part 2.

Challenge 2: Paradoxes Moving from “Either/Or” to “And”

Leaders are having to make decisions and deal with increasingly juxtaposed areas: for example, do we mass produce or customise our offerings, do we focus on the short-term or the long-term etcetera. Usually this has been treated as an either/or choice or, at best,  achieving a blend between the two and effecting a compromise.  Either of these two ways are often sub-optimal and limit the future opportunities.

FROM

5 challenges for leaders - pic01 Leaders need to manage these paradoxical situations and to meet both sets of demands simultaneously to survive and thrive.  Leaders need to achieve a balance between multiple sets of demands, requiring them to be able to quickly weigh and evaluate the situation and to obtain multiple perspectives from others to incorporate in the development and execution of the appropriate strategy.

TO 5 challenges for leaders - pic02

Challenge 3: Restore Confidence & Trust

Research from Sirota has shown a steady decline over the last 5-6 years in the level of people’s confidence in their business, their leaders, and the future.

This is reflected in the 2013 Edelman Trust Barometer, with nearly two-thirds of people 5 challenges for leaders - pic03only believing what is said by companies having heard it three to five times.  This reflects both the high level of skepticism and the fact that messages need repeating to get through the ‘noise’ of the environment.

Leaders need to restore confidence and trust in themselves, the business and the future.  This needs to extend to include the external stakeholders, not just the only internal stakeholders (e.g. employees).  In doing this leader need to provide clear direction, clear and consistently understood the message, and that everyone is aligned with this by ensuring the core values are commonly understood and applied throughout the business.  This needs to ensure that the systems & processes and reward systems actively support this.

Challenge 4: To Collaborate & Empower

To lead in an increasingly challenging environment requires leaders, counter-intuitively, to loosen controls to gain more control.  Being able to adapt and anticipate to the new business reality requires leaders to review and refine their goals, and to create an inspiring vision which is clearly articulated and understood to all levels of the business empower-network-leverageinternally, and to external stakeholders.  In doing these leaders need to be open to new ideas and perspectives, and to extend their networks of relationships. They also need to ensure that the business has the right core values and that these are actively supported and built into how business is done.  This creates a strong, pervading culture that aligns people and what they do.

To drive better communication and coordination between departments, and to reduce internal turf-fights and conflicting objectives, the vision needs to be shared and cascaded appropriately at each level.  Furthermore, in doing this, leaders across the business and at all levels need to be empowered with the responsibility and authority to achieve their goals, to be equipped with the necessary skills and capabilities to carry them out, and enable them to perform by providing the necessary support to actively developing both their skills and potential as leaders and those of their reports.

Challenge 5: Building Individual & Organisational Resilience

In dealing with new business reality leaders need to help their people and their organization to build resilience and agility.  This includes the ability to move quickly, decisively. effectively and proactively whilst capitalizing on existing strengths, developing new strengths and identifying current strengths which may become weaknesses or liabilities as the business and market environments change,

resilience pictureThe importance of developing people resilience, including engaging people emotionally whilst growing and developing them, and providing them with a sense of purpose and belonging, is reflected in the findings of the 2012 American Psychological Association Workplace Survey reported.  In this, it reported that 41% (over two out of every five employees) of employed adults feel stressed out during the workday.

The top 5 sources of stress were identified as:

  1. Low salaries
  2. Lack of opportunity or growth or advancement
  3. Too heavy of a workload
  4. Long hours
  5. Uncertain or undefined job expectations

Furthermore, less than half of employees reported:

  • Being satisfied with the growth and development opportunities offered by their employer (46%)
  • Being satisfied with the employee recognition practices of their employer (48%).
  • Feeling they are receiving adequate monetary compensation (48%).

The importance of having employees who feel valued is also important:

  • Employed adults who report feeling valued by their employer are significantly more likely to report they are motivated to do their very best for their employer (93% vs. 33%).
  • They are also more likely to report they would recommend their workplace to others (85% vs. 19%).
  • On the other hand, those who do not feel valued are significantly more likely to report that they intend to seek employment outside of their company next year (50% vs. 21%).

Summary

In dealing with these five challenges leaders need to have an integrated and disciplined approach.  At its essence is the ability to empower, enable and equip people and leaders at all levels in the organization.  Critical to doing this is building the necessary skills and capabilities into their day to day work.

To develop the necessary individual, team and organizational agility and flexibility leaders need to develop and embed the skills into how they work, allowing experiential learning to occur as they learn and apply the new skills in addressing and gaining traction with key challenges and opportunities.  Providing the on-going support to help the teams and individuals is essential to this, and by enabling people to teach what they have learned to their peers, team members and reports they can gain mastery and continue to deliver sustainable results.  This produces not only in-house skills and capabilities but creates leadership bench strength and an on-going leadership pipeline on which the organization can draw to meet current and future needs.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

Answer At Your Own Risk!

How executive coaching can help you in your business

Leaders and managers often need to give feedback to their teams and staff. Usually it is in the form of advice rather than feedback. Why is this? Advice can be packaged more easily, especially when you are dealing with a sensitive situation and/or individual, rather than feedback which is often perceived as being more critical in its nature. So how can we improve.

The Pixar Story

Virtually everyone knows Pixar , the animation studio that made Toy Story, Finding Nemo, Cars, A Bug’s Life, and which grossed more than $6 billion, and has won 24 Academy Awards. Here is the question for you – how many flops has Pixar produced? The answer is none!

One reason for it is that within Pixar they give brutally honest feedback.

Brutally honest feedback

At Pixar, when a director hits a snag on a film, they immediately call in the “brain trust.” This is a group of brilliant senior filmmakers who come in, look at the film in progress and give brutally honest feedback for about two hours.

Normally this is an uncomfortable process and, at best, only partially effective. But it works for two reasons:

  1. No authority – the “brains trust” has no authority over the person to whom they are giving feedback. It is up to the recipient of the feedback to do something or not. As such they are not under any obligation to take the feedback, and because of that they often do.
  2. No advice – people do not tell others what to do, they don’t offer advice; they offer experience. As such the recipient can learn from others, and can choose what to do or not.

As such, the less authority and power you have the greater the influence you can bring to bear. And the lower the requirement to act on the experience shared, the more likely people are to do so. This creates the opportunity for learning, development and innovation. Counter-intuitive? Yes, but it works. Share your experience – but remember we don’t have to learn from it, but then we probably will!

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

Why Customer Satisfaction is Irrelevant

Don’t assume that because your surveys show that your clients are satisfied it will mean that they will be loyal…

by Andrew Cooke, Growth & Profit Solutions

A common mistake to make is that client satisfaction and client loyalty are positively correlated i.e. that higher the level of client satisfaction the higher the level of client loyalty. customer loyalty satisfaction

Working in a harder and more competitive environment often results in businesses focusing on marketing and selling to get new clients. While continuing to bring in new clients is necessary for a business’ survival, so is keeping your current clients loyal to your firm.

Satisfaction vs. Loyalty

How loyal are your clients?  And how loyal are your “very satisfied” clients?  The answer may surprise you, your clients might be more likely to switch to a different provider than you think. In a 2009 study, across professional service industries, it was found that:

  • Only 48% of clients are “very satisfied” with their service provider

and that

  • 60% of these clients would consider switching service providers

Results by Industry

satisfaction vs loyalty

So what does this mean?

It means that fewer clients are loyal to you than you think.  It also is likely that your perception of the real situation as regards your clients’ loyalty is significantly over-optimistic.

For example, a legal firm that equates client satisfaction with client loyalty would assume, on the basis of the above numbers, that 50% of its clients were “loyal”.  The reality is that of this 50% of “loyal” customers over half are likely to switch to another provider. This means that only 25% of the firm’s clients are loyal – it has over-estimated the number of loyal clients it has by a factor of two!  This has a significant on its ability to maintain and grow business, and the strategies and plans it needs to have in place.  In all likelihood, because people do not realise this, the firm will probably be following the wrong strategies, and this can be put the firm at risk.

As the competitive environment continues to intensify, it’s likely that other firms are marketing more aggressively to your own clients and, as this data suggests, a good portion of your clients may be open to having these switching conversations with your competitors.

Why do we make this mistake? It is because people confuse the two concepts of satisfaction and loyalty. The difference is like that between “like” and “love”. Let’s look at them separately.

Client Satisfaction

Client satisfaction is a tactical concept and measurement, and it speaks only to one moment in time – typically, right after a client has completed an interaction such as a purchase or has a problem solved. So measuring customer satisfaction merely tells you if you are doing your job, from the client’s perspective.  Clients express satisfaction in an intellectual and rational manner. In doing this, it makes people think. satisfaction guaranteed

Many organizations should be performing up to their customers’ expectations.  This is really just the basics.   While these days consumers are in the driver’s seat, the mindset tends toward “what have you done for me lately?” as opposed to “that transaction went well so I’m a customer for life.”  Thus, good customer satisfaction does not guarantee that you will continue to keep those customers.  How many times have you bought goods “satisfaction guaranteed”, yet gone to another product or provider even though you had a good or even excellent experience?  All of us have done so at one time or another.

Client Loyalty

Customer LoyaltyThis is a much more reliable and strategic measure.  True loyalty – much harder to earn than mere satisfaction – tells you that your customer wants to stick with you over the long haul and that they will share that feeling with others.  Loyalty derives not from “good” transactions but from exceeding the customer’s expectations on a repeated basis. Loyalty engages your client emotionally and makes them want to tell others about their experience of working with you and your relationship.  As such, emotions make people act!

Next Steps

It is much easier (not to mention more cost effective) to retain and grow your current clients than it is to continuously have to fill the pipeline with new prospects.   It is enough to get people to think, you need to get them act.  You need to engage them both intellectually and emotionally.

Have a look at your existing client base and assess their level of satisfaction. If you are not sure, then use this as an opportunity to ask them for constructive feedback, listen and learn.  Then begin to think, from their perspective, whether you have done enough to earn their loyalty – be specific about what you have done or not done as the client perceives it.  Do this individually and then come together as a group to discuss your scores, perceptions and to share insights.

Next Week

So, what does it take to build the type of relationships with your clients that keep them loyal and coming back to your firm year after year? We look at the 9 questions you need answered in next week’s blog.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

How Middle-Management is at Risk

Why middle-management is essential for business survival and the risks you run of if you lose or alienate them.

The Challenges of Middle ManagementMiddle management.  Often described as the ‘backbone’ of the company, they provide the continuity across the business and the key people for getting things done; communicating and resolving problems up, down and across the line; translating strategy into action; leading key operational areas; have considerable expertise and experience within the business; providing linkages between senior executives and front-line staff; and are implementing and responding to change.

As such, middle management is crucial to the on-going success and survival of the business.  Senior executives are starting to appreciate their role and the impact of their work, but at a time when it becoming harder to develop and retain middle management.

Middle Management Stress & Turnover

In a recent poll by Lane4 in the UK (July 2012) more than 90% of workers believed that the vast majority of workplace stress was falling on middle management, and two in five (39%) of middle management reported that they were under severe stress.  As such, many mid-level managers are dissatisfied and would like to leave their current organization.   In harder times it is those middle managers who are your best and who perform well who find it easiest to find new roles and new opportunities.

This has several impacts on your business: firstly, the business will lose its top middle management talent, this will put an increase burden on those who are left behind; secondly, the exodus of mid-level talent seriously compromises the business’ future  leadership pipeline and its ability to have the right people in the right place to enable the business to grow and develop in the future; and finally those mid-level managers remaining will be the low-performers, who are more likely to be disengaged and who have “quit and stayed”.  All of this means that business’ ability to survive and thrive – especially in challenging times – is seriously compromised.

The Impact of Mid-Management Turnover

One of the current major growth challenges facing CEOs is the lack of key talent to enable them to grow the business.  This is exacerbated with the turnover of good mid-level manager as it compromises the business’ ability to execute the CEO’s strategy and drive results and outcomes.

Furthermore, the costs of middle management turnover are also high.  A common rule of thumb is to assess the cost of a middle manager to the bottom-line at one-and-a-half to two times their annual salary.  Assuming an average salary of $125,000 then this could mean $250,000 off your bottom line.  Alternatively, look at it in terms of the extra revenue you need to achieve just to stand still – assuming your net profit is 10%, then that is a further $2.5m of revenue required!

Practically, I think this heuristic is conservative.  Once you take into account the corporate knowledge, experience, expertise and insights that have been developed over a number of years you are looking at the loss of a very valuable contributor.  Furthermore, to recruit someone who is an equivalent is both difficult and expensive to do.

Causes of Mid-Management Stress

Middle management is under increasing stress for a number of reasons.  They are the people who have to lay off staff when the company downsizes (or more cynically “right-sizes”), in an environment of poor morale, having to do more with less, with little or no increase in salary or benefits whilst being responsible for more, a reduced opportunity for career progression, dealing with people who like them are worried and scared, and frequently being seen as an “unwanted layer” and at a high risk of being laid off themselves (often having had to lay off others first).

So what do we do?

Dealing with the Problem

In challenging times we need to maintain our middle management.  In economies which are struggling the senior executives need to work with and engage with their middle management even more closely.  It is at the mid-levels that the most important projects are, and reducing their resourcing is nigh on suicidal.  If the level of responsibility for middle management is extended, and their capacity and resources is limited or reduced, then you need to invest in their developing the necessary capabilities.  If this is not done then senior management will be faced with a “frozen” middle management compounded by cycles of low morale and low engagement.

Companies need to be resilient – leaders need to provide clear direction, they need engage the middle management and rebuild trust, and in doing so enable them to engage with their reports and teams in turn.  If you cut out the middle, then you are just left with the head and tail of the business – unable to do the necessary work effectively, and a corpse all but in name.

It may seem counter-intuitive but now is the time to invest in your middle management – this will pay off in terms of loyalty, results and longer-term growth.  Treat your key people as an investment, not a cost to be cut but people to be valued, developed and through whom you can achieve leverage and significant returns.

So what are you going to do?

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Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

9 Ways to Accelerate Customer Loyalty

9 questions to ask to help you keep clients loyal – now and in the future.

 

Customer LoyaltyLast week we looked at the difference between client satisfaction and client loyalty, and the mistake commonly made by leaders in the belief that client satisfaction and client loyalty are positively correlated i.e. that higher the level of client satisfaction the higher the level of client loyalty.

Research has shown that the more value you deliver, the more satisfied your clients will be. The more satisfied they are, the more likely they will be to stay loyal to your firm and refer other clients to you.  There is good logic here, but it makes an assumption which is often not explicit or valid in most instances.

Have you ever had a client for whom you have delivered value, for which they are highly satisfied – and who have then awarded a deal to someone else for any reason?  Most people have had this experience.  We have found that there is a disconnect between our delivering value and our realising client loyalty.

The fault is ours, not theirs.

If we are to keep our clients’ loyalty we need to focus on our clients’ perception of your value and our clients’ perception of your differentiation.  The flawed assumption that is often made is that we look at the value delivered, and how we differentiate ourselves, from our perspective not that of the client.

If you want to keep your clients loyal, you need the answers to nine questions—some of which are focused on the clients’ perception of your value, and others on the clients’ perception of your differentiation.

Five Questions for Valuevalue men

Question #1: What value do clients perceive regarding our general category of company and services?

Perhaps your clients value that you are a diversified marketing company, not just a website firm. Or, that you are a specialist in XYZ, not a generalist. Perhaps they value that you are a family business versus a corporation. How clients perceive your type and category of company will resonate with many buyers.

Question #2: What is the value clients perceive regarding us as a firm?

You might find that clients value your innovation and don’t care as much that you’re periodically unresponsive. Or, that they value your client service excellence, but your technical reputation doesn’t matter quite as much. Maybe there are areas they don’t value or where you are falling down in your delivery.  Clients are not interested in what you do, rather they are interested in the value that you can help them realise.  Be clear on what value they see from your business, and where this value is created, and when, and for how long it lasts.

Question #3: What value do clients perceive regarding the specific services we offer?

This allows you to know what’s working for clients, which services you offer that are the strongest, and where you deliver the best value.

You might also learn that your clients don’t even know you offer particular services. Familiarity, in this case, breeds contempt – one side assuming the other knows, and the other not knowing because they’ve never been told.

Question #4: What value do clients perceive in solving the specific problems they currently have?

We all have problems, but not all problems are created equally. If you know the key priorities for a client, then you can help the client tackle them.  Don’t assume that the client always knows what the problem is – by framing the problem appropriately you can help them to see problems clearly, or to see problems that they never realised they had, or that they had failed to anticipate.  This can be exceptionally valuable to a client.

Question #5: What value do clients perceive they might get if they could solve certain problems or accomplish certain things that they aren’t focusing on right now or might not see as priorities?

In doing this we help clients to create a better future or one that they may not have even known was possible. By helping clients solve problems they didn’t know they could solve, and making improvements they didn’t know they could make, service providers score higher on satisfaction (that, as we mentioned, is an indicator of future loyalty).

differentiationFour Questions on Differentiation

Question #6: What different options do the clients perceive they have regarding different categories of companies that can help solve problems or achieve goals?

Sometimes it doesn’t matter as much which specific companies your client might view as what the other options are that they might be considering.  As such you need to know the types and categories of companies offering services in your region. For example, as a management training company, with a core set of services in classroom training, you need to know if your buyers are considering e‐learning providers—and how to position yourself against them

Question #7: What different options do clients perceive they have regarding specific companies that can help them solve problems?

You need to know your distinctions, advantages, and disadvantages when compared with them. This is from the client’s perspective – not yours.

Question #8: What different options do clients perceive they have regarding specific services available to help them solve problems?

How do clients perceive they can solve their problems?  Can you create options around what they need, rather than what you, to help them think about how they could use you – rather than should they use you!

Question #9: What different options do clients perceive they have regarding other ways to solve problems, such as internal staff?

Competitors are not always the biggest source of competition.  Competition also comes from the option of the client doing it themselves, not doing it at all, changing the scope and extent of the project, or giving preference (and thus some or the entire allocated budget) to other internally competing projects and priorities.

Next Steps

Go through these questions with your clients.  Get it from the horse’s mouth.  Compare this with how you see it, where are the biggest gaps, and which areas are the priority for addressing.

Thanks to Mike Schultz of Wellesley Hills Group whose work provided the basis for much of this article.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.