Posts Tagged ‘data’

Introduction

Introduction 

This leadership tip has something in it for managers everywhere, but it’s particularly targeted at those of you with large company backgrounds who have made career moves to smaller businesses that you own and/or manage. 

My background is primarily in large scale management of IT organizations.  The companies where I’ve worked were places where changing a process or behavior took some time.  I always thought I was quicker than most, and action oriented.  As a small business owner, I found I had to be much quicker. 

I’ll offer this leadership tip in the form of a story.  It’s a story of how taking your eye of the ball can cost you money, and worse than that can cost you customers. 

My First Small Business 

I opened a small personal services business.  It was located about an hour from my home office, and with all my other commitments I knew how important hiring the right manager would be for this shop.  It took a few tries, but I found one with a good background and references, and she seemed to quickly develop loyalty to the business and to me. 

For the first six months we grew slowly but steadily.  We were behind plan in terms of customers and revenue, but the trend was up.  There were a few staff issues, but overall turnover was okay.  I decided to invest a little more in marketing to try and get more new faces in the door. 

Over the next three months, customer counts were mostly flat, and average sale was actually down a little.  Concerned, I visited the shop a few times more than usual.  The people were not as upbeat as they had been.  When asked about that, they attributed their moods to less business and less enjoyment of the job.  I wondered about seasonality, the economy, and whether I needed even more marketing investment. 

Want to know what was really going on?  My trusted manager had some personal problems that I had not been aware of before, and was exhibiting some totally unacceptable behaviors: 

  • Criticizing staff in front of customers
  • Intimidating staff, letting them know they were at risk of being fired, and telling them I was out to get them.
  • Stealing money by voiding transactions and other means  

The Damages 

I’m still figuring out how much money all this cost me, but the money is only today’s problem.  The customers I’ve lost are a more serious longer term issue, because many of them won’t be coming back. 

When I figured out what was going on, I moved quickly to fire the manager.  There were only two problems:

  • I was too late, and there had been several months of damage done;
  • There was collateral damage.  I had to fire two other employees who had adopted the attitude and behaviors of the manager. 

Today, I’m working on putting together data to see if I can assemble a case for prosecuting the employees and the manager.  An even higher priority, though, is the work I’m doing to recruit and orient new staff and develop a recovery plan for our customer service reputation.   

This leadership tip was a painful lesson that I hope never to repeat.

Oh, the stories we tell and the stories we hear

Oh, the stories we tell and the stories we hear. Have you ever heard anyone use one of the excuses below to distance themselves from their responsibility as a team member? Shame on those of us who use these excuses and on those of us who let others use them.

It is not my meeting – Guess what? If you have a business reason to be in the meeting, then it is your meeting too. Not only do you have the right to contribute, you have a responsibility to contribute, so speak up and share your expertise and opinions.

I did not set the agenda – Just a step or two away from “it is not my meeting” is the infamous “well, I did not set the agenda”. The implication is that only the person who defines the agenda can decide what is discussed. So if critical information is not brought to the table, well, that is just too bad, because “Hey, I did not set the agenda.”

Well, nobody asked me – This one is usually accompanied by a pouting face or a petulant tone of voice. None of us should be expected to have access to psychic powers, but if you know a problem exists and you know the solution – it does not matter that nobody asked you directly. Step up and step in to help.

It is not my job – So you knew from reports you receive that the database was about to run out of space. Guess what? Last night the database ran out of space and this morning the application was unavailable for two hours. But it is not your problem; after all, you manage the hardware not the database. It is not your job.

Now do any of these excuses really make sense? Of course not. Remember when one team member decides to disengage, we all suffer the consequences.

Recognizes issues, problems, or opportunities and determines whether action is needed

Recognizes issues, problems, or opportunities and determines whether action is needed.
What sparks the decision-making process? In some cases it’s a request, such as when your leader asks you to choose equipment to purchase, reduce costs, or delegate work. In other cases you might be aware of an issue that needs to be addressed. For example, you:

  • Receive repeated feedback from customers about a product problem.
  • Believe an improvement to a current process could bolster productivity.
  • See an opportunity to increase market share by improving a product feature.

Even when you’re not the person who makes the decision, you can improve the quality of the decision by identifying problems and opportunities. As a result, people develop confidence in your ability to spot opportunities and contribute to good organizational decisions.

1. Recognize issues, problems, or opportunities.
Effective decision makers are proactive. They stay aware of issues, unresolved problems, or opportunities they can take advantage of. Chances are there’s a decision to be made if you have ideas for:

  • Improving work processes.
  • Reducing costs while maintaining quality or efficiency.
  • Improving customer service.
  • Increasing enthusiasm of associates.
  • Bolstering sales or profits.

Example: John noticed that his team’s overtime hours had increased over the past year, yet output levels had remained the same. When he asked the team why, John learned that requests for custom packaging had gone up 25 percent, but due to the current equipment, custom packaging orders took longer to fill. He also found out that the organization charged the same price for custom and regular packaging. By correctly recognizing the problems–increased overtime, amount of time to fill custom orders, and potential lost revenue on custom orders–John and his team faced two decisions: how to decrease overtime and whether the demand for custom packaging justifies modernizing the equipment and raising the price for custom packaging.

To determine if you have a “decision in the making,” ask yourself:

  • Are coworkers frequently complaining about work?
  • Are deadlines being missed or jobs being done incorrectly?
  • Are there an unusual number of misunderstandings or conflicts between/among departments?
  • Is there a trend in customer feedback?
  • Do I have an opportunity to provide a product or service that the competition can’t?

To obtain specific information about your potential decision, check the following sources:Includes sales or performance records, ideas taken from suggestion boxes, and informal communication gathered via your network, team meetings, task forces, and quality committees. Includes competitor information, research reports, and customer surveys and feedback.

  • Internal data.
  • External data.

2. Define the desired outcomes, criteria, and decision.
After recognizing that a need or opportunity exists, write a clear description of your desired outcomes, the criteria your decision needs to meet, and what you hope to decide. Doing this helps you:

  • Determine whether a decision or action is needed.
  • Confirm that you’re addressing the “right” situation.
  • Ensure that your decision yields the results you want.

Desired outcomes refer to the results you want to achieve (for example, exceeding customer expectations or increasing productivity). Outcomes also might include how people should feel about the results. When defining desired outcomes, consider:

  • What you hope to accomplish.
  • How you want those affected by the decision to feel or act.

For example, if you want to buy a winter coat, your desired outcomes would be to stay warm and to receive comments such as, “That’s a stylish coat.” are the measurable and observable characteristics the decision must meet. Criteria are broadly categorized into quality, cost, and time. Your criteria for buying a new winter coat might include:

Criteria

  • Warmth provided (quality).
  • Money you’re willing to spend (cost).
  • The need to purchase the coat before winter arrives (time).

A decision states the specific choice to be made. By knowing the results you want, you can clearly describe the decision to achieve those results.

Defining your decision accurately depends on identifying the desired outcomes you want to achieve and the criteria the decision must meet. Another key element of your accuracy is involving others. Seeking others’ input helps to ensure that the right decision is made and that people support and understand the decision. Otherwise, if you assume the desired outcomes and decision criteria, you risk defining the decision incorrectly and getting results much different than what you expected.

Example: A large beverage manufacturer spent millions of dollars and many years trying to outdo its competitors’ packaging based on an inaccurate decision definition: “What bottle shape can we develop that will be as memorable as theirs?” However, the manufacturer’s actual desired outcomes were for people to drink more of their beverage and ultimately increase market share–not to have recognizable packaging. After reassessing its desired outcomes and redefining the decision accurately as, “How can we get people to drink more of our beverage?” the manufacturer freed its thinking and invented the successful large plastic liter bottle. Market share soared (Russo and Schoemaker, 1989).

3. Determine whether action is needed.
Now that you’ve defined the situation in terms of desired outcomes and criteria, and checked the decision to be made, you’re in a better position to determine whether action is needed. Consider the time and energy it would take to work through the decision and determine whether your and others’ efforts are worth the investment. Think about:

  • Who needs to be involved in the decision. Are they available, and will they be supportive?
  • What actions might need to be taken, and who will initiate them.
  • Whether your leader(s) would support your decision-making process.
  • What time and money are needed to research the decision.
  • How confident you are that you know the cause of the situation.
  • Who else might be working on a similar decision.

Compare the time and energy it would take to work through the decision to the impact of not making the decision. Is it worth the investment? Based on the information you’ve compiled, you might determine that action isn’t needed. If one or more of the following situations exist, don’t take action:

  • The process will take too long and the opportunity will be missed.
  • The effort is greater than the reward.
  • There is little to no consequence for not taking action.

Recently i was doing a keynote presentation on innovation when a member of the audience, a senior manager at a large company, posed this question:

Recently I was doing a keynote presentation on innovation when a member of the audience, a senior manager at a large company, posed this question:

“What’s the difference between individual and organizational innovation?  We have plenty of people who come up with good ideas, but nothing new ever seems to get done in our company.”

This particular manager happens to work for a well-known company that likes to consider itself innovative, so his question momentarily took me by surprise.  But one thing I have learned over the past few years is that our assumptions and beliefs about what goes on inside an organization versus its public persona are often two very different things.  And there is no shortage of misguided ideas and assumptions about the innovation process.

In business, innovation is the act of applying knowledge, new or old, to the creation of new processes, products, and services that have value for at least one of your stakeholder groups.  The key word here is applying.  Too many people assume that innovation consists solely of coming up with good ideas.  That’s part of it, of course.  But in order to have true innovation, you must implement.  You have to actually do something different that has value.  Brainstorming or chatting about new ideas does not qualify as innovation.

Individual innovation has to do with the content of innovation.  It involves examining your own thinking process to understand why you think the way you do.  More important, it involves pausing your thinking process every now and then and contemplating how to change perspectives, how to challenge your own assumptions, how to consider the opposite of what you normally think, how to ponder multiple right answers, and how to do things differently.

Organizational innovation is all about the context for innovation.  Context includes the culture, leadership styles and norms, competencies of individuals, teams and functions, business processes, performance measures and strategies.  Have you created a context in your company that encourages, inspires, and fosters doing things differently? Do you have systems and processes in place that operationalize doing things differently on a regular basis?

Most organizations operate from a “control and manage” mindset.  When people bring up new ideas, the leaders smile and say, “That’s nice. Now go back to your job and get me that report.”  In other words, keep doing the same things in the same ways.  Organizational innovation involves developing the spirit, tools, processes, and attitudes that encourage people at all levels to every now and then pause and think differently.

Not about everything, of course, because you have to do some things the same way in order to be effective.  But every once in a while it pays to stop and ask “What if….?”  For example, “What if our biggest competitor purchased us?  What would they see?  How would they approach our market differently?”  Or, “What if we didn’t know what we already know about our customers?  How would we go about determining their wants and needs?  How would we use that information to add more value than anyone else in the industry?”

Like everything else, fostering organizational innovation starts at the top.  People pay far more attention to what you do than what you say.  So if you want to encourage innovation at all levels, you have to model it.  Practice the concepts and tools of innovation. Practice screening in (rather than screening out) more data so that you can look at things differently.  In particular, learn how to look at things outside your industry and make new connections to your business.

When I worked for The Coca Cola Company, every year the chief marketing officer flew to Paris for the fashion shows.  Why?  To see the fashion trends and get ideas on how new styles could be applied in the beverage sector.  It is easy to look around your own sector, at similar companies and get ideas.  Part of your job as a leader today is learning to look in new and different places for ideas that can be applied to your business.

Every time you have a thought bubble that says, “I am right!”, deliberately pause and ask, “What if I’m wrong?  What if there’s a different way to see this?”   Innovation doesn’t mean you walk around wondering if you’re wrong all the time.  The idea is to force yourself (every now and then) to open your mind, suspend your assumptions and judgment, and simply ponder, “What if…?”

When you learn to insert the “What if?” pause once or twice a day, you’ll come up with more new ideas.  You’ll model an important behavior that will help set the context for innovation in your company.  And you may be very surprised at the answers you get.

What is your next “What if?” question?

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