A critical aspect of leading a business is clarity; clarity of direction, clarity of roles and responsibilities, and clarity of processes.  People need that.  They need to know exactly what is expected of them in their jobs, and what they must do and how.  Their training is derived from it.  Their performance and pay is linked to it.  The organizations ability to operate profitably is directly affected by it.  A lot of fundamental elements of organizational effectiveness are wrapped up in clarity.

I am sure you have all heard it said that specialization of tasks enables people to perform with high quality and efficiency.  Adam Smith characterized this as division of labor and wrote of the advantages of specialization for enhancing human productivity as early as 1776 in his classic book The Wealth of Nations.  Clarity and consistency are fundamental elements of that concept. 

…[leaders] often do not realize that they have the opportunity, in fact the responsibility, to draw the line as to what options they are willing to offer in their products and services, and in their processes to deliver them.

The less clarity and consistency an organization has, the more the variability that creeps in.  With that variability comes different ways of doing things from one situation to the next.  Those different ways of doing things cause quality problems and inefficiencies, errors and increased costs.  Much of what you learn in process improvement technologies, such as Lean Sigma and Kaizen, is all about reducing variability for that exact reason.

However, customers often want things their own way, and it is important to be flexible in providing your products or services in order to meet those special needs.  The McDonalds/Burger King war hinged on that exact concept.  Burger King waged the “Have It Your Way” campaign for years to distinguish themselves from McDonalds and earn market share.  It worked, but it was expensive for Burger King.   

However, Burger King used the Core Concept quite effectively for that time.  They identified a range of options within which customers could “have it their way”, but they limited those options.  For example, you could have your burgers with or without lettuce, cheese, pickles, etc., but you could not specify what type of lettuce, cheese, pickles or bun you wanted.  Most importantly, you could not have your burger made any other way than grilled.  You could not have it fried or sautéed with onions and mushrooms. You could not order your burger rare, medium or well-done.  Why not?  That degree of variability would have been too much for their operations to handle efficiently (to say nothing of the fact that it would have taken away their major differentiator).  That degree of variability brings with it increased operating costs.  With increased costs comes increased prices, and they would no longer have been able to compete with other fast food restaurants.  So, while Burger King was adding a degree of flexibility to their operations and their service offerings, they were protecting the core operations of their business by limiting the options that they were offering. 

Every operation has the same issue, and many leaders do not realize it.  Customers often feel that they have a special need that cannot be met any other way than the way they have in mind.  In an effort to meet the disparate needs of all their customers, leaders often lose sight of the core strengths of their business and their business model.  They try to be everything to everyone.  They do not realize that they have the opportunity, in fact the responsibility, to draw the line as to what options they are willing to offer in their products and services.

Remember, your customers are not the experts in YOUR BUSINESS and usually do not know all the options available to them for meeting their needs.  They do not understand the benefits of doing things the way you do them from a cost and quality standpoint.  That is the discussion that you must have with them.  That is the education they need.  

It is right to try to find every possible way of meeting your customer’s needs.  The key is determining where and how to draw that line.  As a leader you need to decide in which areas will you choose to be flexible, and in which areas will you not?  In which areas will flexibility enhance your product or service offerings, and in which areas will it not?  How much flexibility can you profitably manage within the context of the business model you have chosen and the market segment in which you are competing?  Those processes constitute your CORE. 

• Those core processes are where you establish and maintain your position as an expert supplier or service provider.  
• Those core processes are where you add the most value to the end results your customers are after. 
• Those core processes are where you maintain the opportunity to ensure the profitability of your business.

To protect your CORE, you MUST demonstrate the technical and economic equivalence or superiority of your methods to what your customer is proposing.  

The obvious question becomes what if you cannot prove the technical superiority or economic advantage of your methods?  Then you may need to consider implementing their recommended changes on a broader scale.  Don’t be afraid of this outcome.  Don’t let your ego get in the way of listening to ideas that may help you improve your operations.  Remember, your customers are a great source of competitive information.  They are shopping your competition every day.  Take advantage of that. 

Just for the record, customers are not the only group that can affect your core processes and operations.  In addition, processes are not the only aspect of your business that can be affected by external influences.  Employee attitudes can be affected as well.  Regulations, media communications, competitive changes are examples of external influences that can affect processes and/or employee attitudes and your organization’s ability to perform correctly.  Therefore, a task that you have as a leader is to minimize the impact that all “external influences” have on the CORE of your business. 

Think about this.  What business are you in?  What is your expertise!  What are your core processes?  Identify the core elements of your business and build structures and processes to enable that core to operate as efficiently as possible.  Then, protect that core from external influences.  It will enable you to improve the quality of your services and the profitability of your operations.

Great challenge for a leader…How do you handle dissention in the ranks?

Certainly, it depends upon the situation and how far the “disease” has spread.  In this type of situation, one problem we have, as the public, is that we do not know all the facts, and never will…so we can only make assumptions.  In this case, one basic assumption I am making is that this is not the first time there has been disagreement between Obama and McChrystal.

The only argument I could envision about keeping McChrystal in command in Afghanistan is that he is the one who developed the plan for our current campaign, and he is closest to the action and what steps need to be taken going forward.  However, it would appear that he is neither willing nor able to carry out that plan.

Going as far as he has in his public comments about the campaign in Afghanistan and the current administration, particularly when it was his plan in the first place, McChrystal demonstrates poor judgment at best.  In addition, though he may make a public apology, it is highly unlikely that he will ever be truly “on board” again.  These actions are an indicator of a lack of commitment.  That lack of commitment will likely play itself out in a failure to deliver in a time of crisis, when you need your leadership most.  In addition, it sends a message to the rest of our military that diminshes the importance of order and command.  That is hugely dangerous.  It weakens our military and it plants the seed for weakness throughout our government.  In a business setting it would send a signal that it is acceptable to not be committed to the direction in which the organization is going.  That would certainly make it more difficult to succeed.

My opinion is that Obama has no choice but to remove him from his post.  McChrystal’s comments not only indicate that he is not committed to this administration and to the course we have chosen in Afghanistan, but that he may have poisoned the waters among other military leaders on the ground in that theatre.  He has publicly taken a position of defiance and disrespect.  It is a shame for a man who has contributed so much to the effort to bring peace and stability to that region.

Lots of leadership lessons here. 

Let’s hear your thoughts on this…on what you think Obama should do…and also on what you think are  the leadership lessons here.  Comment right on the blog (scroll down to the COMMENT area and click on “Comments”) so other readers can read about your perspective. 

“Be mindful of the responsibility you have to those you serve, but be more mindful of the responsibility you have to those who serve you.”

In other words, it is critically important to take care of your employees, perhaps more so than it is for you to take care of your customers.  To a large degree, it is your employees that take care of your customers, not you.  If you treat your employees well, they will do the same FOR your customers.  If you treat them poorly, they will do the same TO your customers. Both are a reflection of how you have treated them and how they feel about YOU!  Think about that!

How you get things done is a reflection of YOUR character as a person and as a leader, and it creates an expectation of how people will expect you to act in the future. 

Similar to the last quote, I like this quote because it speaks to “how” you get things done as a leader, more so than ”what” you get done.  In this case, though, it is speaking to the “how” as a reflection of Values rather than Process. 

As a result, it defines the behavior that people within your organization will come to emulate.  It defines the culture that you will create in your organization, and how the organization will grow to operate in the longer term.  It defines the character that the organization will come to have and for which it will become known, inside and out. 

It will define YOUR legacy.

A short time back I was talking with a friend who was having trouble with several aspects of his pharmaceutical regulatory consulting business.  He was not getting the performance he wanted from his employees and they were demotivated.    He was not making the profits that he should and he was overworked.  He felt that if he just worked harder, things would get better.  Unfortunately, he had been saying that for quite a few years, and he had not made any progress.  I could not imagine him working any harder, but he kept thinking that that was the answer.

This is not an unusual perspective for technically trained people, particularly people who hold the professional credentials for their business. 

In a moment of desperation, he asked me what I thought he should do.  First, I remarked that he was not utilizing his team effectively; he was not delegating enough; he was doing everything himself.  I said that this has a couple of bad effects on the business.  First, it is demotivating for your employees.  If you do everything yourself, your employees lose their motivation to think and act.  They have no latitude to draw upon their own expertise to contribute to the business.  They end up standing around waiting for you to tell them what to do and performing tasks that are well below their capabilities.  They feel no sense of accomplishment and they see no future for growing and developing their skills.

You have to look at delegation as assigning authority.  You maintain control and responsibility from a distance.

 The reason delegating is motivating is because it tacitly recognizes someone’s worth.  You trust them to do the job well, and they want to live up to that expectation.  They want to contribute.  They want to be of value.  Controlling everything yourself has the opposite effect.

Then I explained to him that there is an even more important aspect of effectively structuring your operation and delegating tasks.  To start we agreed that a fundamental principle in profitable business operations is delivering the right product or service, at the right price, at the least possible cost.  The “right service” is closely regulated in the drug development world, and pricing is very competitive.  That leaves cost reduction as the key to managing profitability. 

The problem here was that he was doing everything.  By doing so he was minimizing his profitability because HE was handling most of the tasks, and HE was the most expensive employee in the company.

He needed to do a better job of delegating.  His response, of course, was that he could not.  His license depended on everything being done exactly per the regulations, and he felt that he was the only one who knew the correct way to do these things.  So, I asked him if he always got regulatory approval on his submissions the first time.  He said, “rarely”.  So, I said, apparently the regulators feel that there are some other ways to do things that may be just as good, if not better, than the way you think best.  He agreed and recognized that perhaps he could allow people more latitude to do things without his direct involvement.

If you are not delegating, then you are not leading; you are doing.

Finally, I pointed out that if he were the only one performing all these tasks, or overseeing every aspect of every job, then the total volume of work he could expect to do in his organization was limited to the workload that he alone could handle.  That put a great limitation on his business prospects for the future.

So, he agreed to consider this idea of delegating.  Question was, “how”? 

• Simple first step: I told him to list ALL the tasks he ever finds himself doing…every one of them.  Take a few days, take notes about what you are doing, and make a list. 
• Second: Put that list in order from the most to the least by what REQUIRES your technical training and abilities. 
• Finally: Start to delegate by taking the bottom 10% of those items and assigning them to someone else.  Get them OFF your list.  Clearly define exactly what you want done, and establish the methods and mechanisms for keeping an eye on the quality from a distance by developing and reviewing checkpoints or metrics. Over time you can go to the next 10% of the items on the bottom of your list, and so on until you find the right balance.

Though it has only been a short time since we had this discussion, he has indicated that his team has been energized by the prospects of this new direction, and he is now able to focus his time and energy on those aspects of running the business that really require his expertise.    

*****

It is very difficult for people to let go of control in their businesses.  However, it is fundamental to effective and profitable operations to have a clear and appropriate delineation of duties.  You have to look at delegation as assigning authority while learning to maintain control and responsibility from a distance.  If you are not delegating, then you are not leading; you are doing.

Here are a few more thoughts on the subject of giving feedback…

A constant flow of information about how people are performing will keep their performance as close to on target as possible, as we pointed out in the last post.  Waiting to give feedback allows performance to stray until such time as you actually give the feedback to correct performance.  Every minute of substandard performance costs your organization.

Interestingly, your other employees know when a co-worker is under-performing long before you do.  They are closer to it and they see it every day .The longer it takes you to recognize the poor performer and act on it, the more credibility you lose as a leader.  The other employees see you as weak, unaware, or unable to make the tough decisions.  Conversely, when you do act on poor performers, other employees learn from it.  They learn that they must perform; they learn what poor performance looks like; and, they learn that you will act on poor performance.  Most importantly, they will learn that you have the strength and courage to do what is in the best interest of the organization and, therefore, in their best interest.  They will respect that.

Also, consider this.  When giving feedback to an individual about something they have done, you need to do so as soon as the action has occurred, or as close to it as possible.  In this way the action you are referring to has just occurred and the specifics of it, the assumptions and motivations behind it, and the impact of it are as clear as possible.  It is easiest to correct the behavior in that moment; the learning opportunity is at its greatest.  Waiting until the annual performance review to give examples leaves a lot of room for a lack of clarity and misunderstanding.   

Finally, how you give feedback is as important as what you say.  A couple of pointers on this:

Make feedback about an action and a result, not about the person.  As an example, one time I had a CFO whom I had asked to develop cost standards for one of our operations.  He did so, but they were not done correctly.  As a result, we were incurring unfavorable variances every month despite performing our production processes as defined.  I called him into my office and pointed that out.  I told him that we are incurring unfavorable manufacturing variances every month, and that the standards we are using apparently were not done correctly.  Then I asked him to tell me what he thought was wrong with those standards and how we should change them moving forward.  I made no mention of his or anyone else’s involvement in developing those standards.

By taking this approach, I focused on the problem and not the person.  He knew that those standards were standards that he had developed, and he knew that I knew it.  He did not need to hear anything more than the fact that they were wrong to get the point that he had made a mistake.   By focusing on the problem and not the person you move directly to corrective action without damaging their ego or self-esteem.  They can then focus on correcting the situation.  They will not feel that they have to defend themselves.  Saying to them that “the standards you developed are all wrong and are causing variances” carries with it the message that “they” did a bad job, that “they are not competent”.  Their response will be defensive, they will be less likely to hear the suggestions you give them, and they will be less likely to move forward quickly with correcting the situation.  They will be devoting time and energy to worrying about and repairing your impression of them; unproductive time.

Having said that, there will come times when it becomes clear that an employee is actually NOT able to perform a given set of tasks.  See the post on Managing Performance for tips on how to handle those situations.  http://www.scottneilson.com/?m=200902

Last point…Make giving feedback a personal matter between you and your employee.  I generally (not always) provide feedback, both positive as well as “constructive”, in private.  I call the person into my office and have a casual conversation about it.  Personally, I feel more comfortable that way anyway.  Funnily enough, I must say that giving feedback in this way makes for a very interesting scenario.  Whenever I ask someone to come into my office and I close the door behind them, they always assume that the end of the world is near and I am about to give them their last rites.  When I tell them that they did a good job with “X” or “Y” and what I liked about it, they always look surprised and say “but”, as if I am about to tell them all the things I did not like.  When I say, “no buts, nothing else, just a nice job on that”, they look surprised but pleased, and leave my office in a bit of shock but uplifted.

However, sometimes it serves a very useful purpose to give feedback in a more public setting.  For example, a positive stroke can send a message of credibility for an employee among his or her peers, and there may be a time when that is needed.  Likewise, “constructive” feedback for an individual may provide a lesson that is more broadly needed for a group of people.  In this case it is important to immediately and clearly frame that feedback as relevant for the whole group, not just an individual.  It may even require you to give other examples of similar behavior that quietly implicates others on the team and provides a broad lesson for the group.  In that way the one individual does not feel that he/she is being singled out in front of their peers, but broader feedback is being provided for the group. 

*****

There is a lot to giving feedback.  It is an important aspect of leadership, and one which you must be good at.  Like many other leadership skills it is not rocket science, but it does require developing an understanding of the concepts and applying them.  It requires practice.  It requires you to make it important.

This is a subject that generally scares people.  FEEDBACK!!!  “How do I tell someone when they are not performing up to my expectations?”  “I hate filling out performance evaluations.”  “I hate annual review discussions”.  The whole subject is fraught with negatives, and it doesn’t need to be.  Feedback must be given…it is so critically important to getting good results.

You achieve better results by giving people positive feedback about what they are doing right than by only giving them feedback about what they are doing wrong, or no feedback whatsoever.

One of the reasons people have trouble giving feedback is because they only focus on discussing the negatives.  Many people assume that giving feedback means telling people when they are doing something wrong; transmitting negative information that people will be upset about receiving.  It shouldn’t be that way!

Someone once said that you get a lot more mileage out of telling people when they are doing something right than only telling them when they are doing something wrong.  Think about it.  There must be a hundred ways to perform a task incorrectly, and only one way, or a few ways, of doing it correctly.  So, if you are only telling people when they are doing it incorrectly, then they are getting little, or no, information about how to do it correctly.  Absent any other feedback they will experiment with many ways, which may be wrong, while hoping to stumble upon that one way which really accomplishes the task.  What an unproductive use of time!!!

There is an activity I once saw conducted along these lines.  It demonstrated the point quite well.  A group was divided into two sub-groups…team A and team B.  The task was for each group to blindfold each member of their team, one at a time, and have that person walk across the room and try to put a sticker on a target which was hanging on the wall.  Each team would blindfold their contestant, spin them around a few times, and aim them in the general direction of the target.  Team A could give NO feedback to their team member who was walking across the room trying to figure out where the target might be.  Team B was to clap when their member was going in the RIGHT direction, and make no noise when they were going in the wrong direction.  As you would expect, the stickers from team B were very close to the target while the stickers from team A were all over the wall.

The point was clear.  You achieve better results by giving people positive feedback about what they are doing right than by only giving them feedback about what they are doing wrong, or no feedback whatsoever.

I have tried to make giving feedback a habit of this in my personal life as well as my professional life.  With my children I find it does a lot of good for their self-esteem to get messages about things that they are doing right, even if it is about things that I imagine to be small things.  With employees, I find that it is not only a way to ensure the results you seek, it is motivating for them.  Feedback, in these cases, is recognition.  Recognition means that they are of value to you.  Being of value satisfies a core need that we all have.

Bottom line is that I try to spend as much time giving positive feedback as I do giving “constructive” feedback…actually, even more.  When you focus on the positives, everyone feels good about it.  It contributes to a positive attitude in the workplace.  It contributes to continued good performance.  Unfortunately, the fact that people are often surprised to get good feedback is a sad commentary on what people have come to expect in the workplace.  It reflects that we have gotten in the habit of focusing on only the negatives in giving feedback and managing performance; that punishment is seen as a primary motivator in leading teams.

Oh well, the next minute is the first minute of the rest of your life.  It may be time to chart a new course.