Monday, April 27, 2009

Continuous Learning: A Foundation for Sustainable Success

It may sound like heresy in corporate America to say that results don’t matter, but they don’t … if you don’t understand what drives results. Too many executives focus on results without taking the time to understand what drives those results and to reinforce those drivers in their managers and employees. And, contrary to popular belief, results are not about hard work and effort (although those are critical factors in any success equation); results are about working smarter and understanding how your team’s behaviors, actions, and measurables contribute to their success or failure.

This is a mentoring and coaching issue more than an accountability issue. Too many executives take the easy route and just complain that their managers and teams are not meeting their goals and objectives and blame it on lack of accountability. But they have not taken the time to identify the key behaviors, actions, and sub-goals that will result in success at the larger level. This is the responsibility of executives. Most managers and teams cannot appreciate the complexity that comes with trying to “be profitable” on a corporate scale. There are just too many factors to consider: sales variations from month to month, monthly cost variables, macro-economic trends, inventory swings, overhead cost allocations, business unit allocations, healthy and unhealthy cannibalization between business units, cyclicality, known and unknown competitor actions, etc. And these are all excuses waiting to happen… and excuses are the death of a company.

Successful executives take the time to work with their managers and teams to identify the controllable actions, behaviors, and measures that they want their managers and teams to be responsible and accountable for. These controllable actions, behaviors, and measures, if executed across every facet of the business, should lead to the higher-level corporate goal (typically profitability or cash-flow). And they mitigate most opportunities for general, ambiguous excuses from managers.

If the company does not achieve its higher-level goals then one of three things has happened: (1) the managers and teams did not deliver on their controllable actions, behaviors, and measures; (2) the controllable actions, behaviors, and measures were not, in fact, the correct ones to affect the higher-level goals; or (3) other factors intervened. We can learn something different, and critically important, from each of these three different potential outcomes.

First, if the managers and teams did not deliver on their controllable actions, behaviors, and measures then it should be clear to everyone, including the managers and teams themselves, that they failed. And this is a crucial point. The controllable actions, behaviors, and measures should be so clear, fundamental, and directly controllable that there is little, if any, room for excuses. Of course the goals need to be created in an intelligent manner. For example, goals need to be set so as not to be contradictory with one another (decrease headcount but increase production) and so as to recognize that other intra-period activity can influence the outcome. For example, if the goal is to decrease finished goods inventory through a concerted sales effort but the production department produces more than forecast, then the sales team might have had a stellar sales month despite the fact that inventories rose that month.

A mature executive team recognizes and works with these nuances. Additionally, a mature executive team is also adept at breaking problems or challenges down into component root causes. This is critical in setting controllable actions, behaviors, and measures because if the team sets an overly broad, arbitrary goal without understanding what the true drivers or root causes of a business problem or challenge are then they will almost surely not result in the required outcome. This is the second outcome that can occur: the controllable actions, behaviors, and measures were not, in fact, the correct ones to affect the higher-level goals. And the only people to blame in this instance are the executive team – it is truly a failure of leadership, mentoring, and coaching. This is like saying that our baseball team is losing because our pitchers are giving up too many runs and therefore we need to get better pitching. But the coaches failed to validate whether the runs were earned or unearned; whether the problem was with our starting pitching, middle-relief, or closers; or if the real problem was with our hitting if we looked at proper benchmarks for our pitchers. The last thing we want to do is go out and replace all of our starting pitchers if the real problem lies elsewhere – we might only be exacerbating the problem.

This is the most exciting part of the game (errrr…work): problem solving the root causes of what is driving failure. Too often, executives come up with superficial root causes, or focus on irrelevant or unrelated root causes, and play the blame game. In my experience, the primary reason for failure is that the managers or teams are focused on solving the wrong problems that will not result in the desired results. This is what makes business (and sports) so interesting. You get to take the learnings from last month or week, or last game, and try another approach to solve the problem… if you have the courage to recognize that it is not always about execution…but about operational strategies…which the executives or coaches have to determine.

This is often referred to as “learning to learn”. It is the foundation of all successful people and organizations. This is the power that comes with a true learning organization: we might not get the results we wanted…but the more important questions are: what did we learn and what are we going to do differently this time? If you can reach this level of self-awareness and leadership and eliminate the politics that comes with an organization that blames rather than learns and teaches and an organization that obfuscates rather than delivers meaningful, timely, actionable financials and metrics then your organization has a foundation for success.

Organizations with these attributes celebrate failure rather find fault and blame and are positioned for growth and continuous improvement. Failure is recognized as an integral part of learning, experimentation, and risk-taking. When people and teams are blamed for failing, rather than praised for learning and improving, it has a severe chilling effect on all future risk taking and innovation. And worse, it destroys morale, commitment, and the confidence required to lead through difficult times.

This is not about celebrating mediocrity nor about tolerating sustained failure. Quite the contrary…when executive teams fail to create an atmosphere that encourages understanding, introspection, and learning they create and foster mediocrity and failure. There is no other outcome, unless you believe in luck. Aiming for good business results without understanding root causes, is like raising children without understanding what good parenting is. If your children turn out well, you can only attribute that to good fortune. If your business succeeds without good root cause analyses you are only lucky, and in the long run that is not sustainable.

I mentioned earlier that there is a third possible driver in why a manager, or team, did not achieve the results they intended to achieve: other forces could intervene. It is the great fallacy of our sophomoric, unenlightened minds to believe that we control our destiny – for we do not. We can only control our actions and behaviors; and sometimes despite our best efforts and despite the fact that we chose the correct actions and behaviors, life intervenes and everything does not go as planned. That is the beauty of life: we cannot control what life brings to us; we can only control how we respond, or how we choose to act and behave in response to life’s surprises.

Mature businesses recognize that this is a distinct possibility and, thus, they are most interested in assessing the competencies and capabilities of their managers and teams in the context of the possible depth of the learning and understanding that comes from failure and that could lead to better actions and behaviors in the future.

Excellent executives and corporate boards (and sports team owners) recognize that getting results is a learning process. And ironically, when you have the right people who are self-aware, apolitical, and realize that failure is good; who are managing to the right processes which imply learning from experience and continuously improving; and who are measuring the right controllable actions, behaviors, and goals… the results will take care of themselves.

These executives and boards hold themselves accountable first and ask honestly: (1) have they set the correct controllable actions, behaviors, and measures with their managers and teams? And (2) are they working with their managers and teams to learn from failure and to continuously improve? (3) Have they created an apolitical environment in which their people can learn, grow, and succeed?

This is the true nature of leadership and coaching. You are as much responsible for the success of your company or team as your employees or players are. Are you creating an environment for them to succeed?

Thursday, April 16, 2009

The Best Strategy: Always Speak The Truth

What is the best negotiating strategy? Never bluff, always tell the truth, and have the facts, and keep the possibility in your mind that you could be wrong. The same is true of life in general.

If you always tell the truth, life is so much easier and you always have the confidence that comes with moral integrity. In other words you don’t have to worry about your “tells” if you are telling the truth; your integrity, sincerity, and confidence in your position will be transparent to everyone else. What better negotiating position is there than that when you are dealing with a business partner? What better relational position is there than that when interacting with anyone in your life.

And it is so much easier to remember the truth. When you start to tell different stories it becomes too much to keep track of. Isn’t life complex enough already? Isn’t your life interesting enough and challenging enough already? And lies are never as convincing as the truth; the truth is natural and spontaneous and it shows through in the moral confidence that comes with the integrity of being transparent.

And if you always tell the truth then you never have to bluff. Why bluff? You only bluff when you are in a position of weakness. But if you are then either change the playing field or yield to the stronger position. Save your credibility, integrity, and strength for another day when you have the stronger negotiating position. Your opponents will respect you much more for having the integrity to know when to fold and for treating them with the respect that comes with acknowledging a stronger position. Your basis for future negotiations will only be solidified.

For once you bluff, or lie, you are always a liar. People remember that and then you lose all credibility. Always negotiate from strength and always keep your integrity in tact.

How do you negotiate from strength? There are no tricks or secrets. Just have the facts and always stick to them. Don’t exaggerate or overstate them. Many negotiations end in frustration and loss of integrity because we argue over opinions rather than facts. If you have the facts, you can keep opinions and emotions to a minimum.

The same is true in life. When you are confronted with a difficult situation stick to the facts as much as possible; focus on the facts and not on hearsay or opinions or personal judgments, and be as unbiased as possible in assessing the facts. If you are wrong, admit that you are wrong based on the facts. This is incredibly powerful: to admit your fault when you have made a mistake or when you are presented with new information that changes your position on something.

Commit yourself to knowing the truth and not to defending your position. Let go of the need to be right and accept the possibility that you could be wrong. It is said that “the ability to hold two competing thoughts in one's mind and still be able to function is the mark of a superior mind” (Fitzgerald, 1956). If you open yourself up to the possibility that you are wrong you become a much better listener…and listening is the key to negotiating and to life.

Stick to the truth, negotiate with the facts, and listen with an open mind.

Namaste!

Monday, April 6, 2009

Communication Challenges and Benevolent Assumptions: The Root of Interpersonal Conflict and Resolution

In my experience of observing people interact, listening to them argue, and observing relationships develop and deteriorate at all levels of business I believe that 99% of interpersonal conflict occurs because of truly basic miscommunication issues and because people fail to carry benevolent assumptions about the people they are interacting with.

Basic miscommunication occurs because most people are really poor listeners and because of the inadequacy of any language to accurately represent what we are trying to communicate. Have you ever been speaking to someone or to a group of people and someone responds with a complete non-sequiter? People are so distracted and overextended these days that their minds are naturally wandering to all of the things that they need to take care of while you are speaking. Also some people are not even trying to listen, they are just waiting to say what is on their mind.

Listening requires intense active effort to stay focused and to follow a person’s line of thinking and to let them finish their thought to completion. Even harder is listening to another person follow-up and then to be able to hold both thoughts in your mind and compare them. Being a good facilitator requires exactly this effort and ability. Practice it the next time you are at work and repeat back to both people the summary of what you just heard by comparing the thoughts from both people. On many occasions you will find that the second speaker wasn’t even listening to the first person and is off on a tangent. Can you bring the conversation back to the point by guiding the conversation back to the original topic?

On other occasions, and not infrequently, you will find the second speaker claiming to disagree with the first person’s comments but often the claimed disagreement is only because the second person did not completely hear out or grasp the first speaker’s message. This only compounds when the first speaker makes the same mistake regarding the second speaker’s comments. And then the discussion is headed nowhere very fast. This is the major problem with meetings today. People do not listen to each other and they do not have the discipline or skills to keep conversations focused on the issues at hand.

Unfortunately both the speaker and listener are at fault – the listener because he failed to actively listen and stay on track, the speaker because he does not have the ability to respond and guide the conversation back on track. Both are critical skills for success in business and relationships. Facilitation is a learned skill and requires both intelligence, patience, subtlety, and directness. Active listening is simple: let go of all of your own thoughts and focus only on what the speaker is saying, nothing else.

To do this successfully actually requires another key skill that many people lack but once accomplished will bring you incredible success in business and relationships: the ability to suspend disbelief and to accept the possibility that you are wrong. Poor listeners are not able to do this because they are too focused on defending their own position and trying to figure out how they are going to rebut or refute what the speaker is saying.

This happens all of the time in business when two people are arguing and they refuse to just stop and listen and to imagine how the other person’s point of view might be correct. The quicker that both people can do this the quicker they can resolve their disagreements. In fact, they cannot resolve their difference until this happens. When this happens at work I always insist that each person articulate the other person’s point of view and how that point of view could be correct.

Arguments and disagreements can still ensue, but everyone arguing has the obligation to understand the other person’s point of view before they can argue their own point of view. This leads to much quicker and amicable resolutions and makes sure that the differences are based on true differences in values, priorities, or strategy rather than misunderstandings, misperceptions, or a basic failure to listen.

Compounding people’s inability to listen is that even when people are actively listening the spoken language is a very poor communication vehicle for ideas both simple and complex. How many times have you tried to communicate something and the message is just not getting across? Language is imperfect and subject to so many literal and subjective meanings that by its very nature language makes it difficult to communicate. Add in to that non-verbal cues like body language and past interactions with people and it becomes even more difficult.

This is why it so important to seek to understand what the other person is saying before you seek to be understood. Active listening requires asking clarifying questions to make sure you have gotten the point. I often try to repeat back to the listener in my own words what I think I just heard and what I think it means or implies. Try it and you will find out how much you really missed and how complex ideas really are. And you will also build a tremendous amount of rapport and credibility with the person you are speaking to.

Doing this really successfully requires a listener to also carry “benevolent assumptions” about the other person especially when there is the potential for conflict. Benevolent assumptions are assumptions that presume that the other person has no ill will toward you or any malicious intent.

When we do not make benevolent assumptions and instead assume that people have bad intentions toward you we stop actively listening and start to hear what we expect to hear: confrontation and maliciousness. And from this starting point, communication can only deteriorate. In other words, assuming malicious intentions becomes a self-fulfilling prophecy because the other person can sense your animosity in your response. And how do you think they will respond?

The benefits of carrying benevolent assumptions in two-fold: first, the very nature of benevolent assumptions makes you a better listener because you are actually listening with an open-mind seeking to understand rather than shutting down because you are in a defensive state. Second, having benevolent assumptions also brings a self-fulfilling prophecy – when you actively listen with an open mind to others and can restate what they have said in your own words how much more open do you think they will be to your ideas when it is your turn to speak?