Until morale improves

You may be familiar with the term cognitive dissonance,  the "psychological conflict arising from simultaneously holding two incongruous beliefs."

It is a theory that we all seek to "hold our attitudes and beliefs in harmony and balance" and when conflicts arise, we seek to restore our sense of harmony by reducing or eliminating the dissonant. The idea that spawned the theory is that we humans want "cognitive consistency" in our beliefs -- to believe what we believe, in other words -- and that need can lead to irrational and sometimes destructive behaviors.

This pop-psychology lesson is prompted by an interesting week in the pursuit of cognitive consistency in employee-related matters.   It was a somewhat futile pursuit:

• An employer who has bemoaned the quality of applicants for open positions, but who continues to seek candidates from the same talent pool using the same recruiting tools.
• Employees who decry micromanagement, but won't follow simple procedures and checklists designed to make their jobs safer and more productive.
• A CEO who was surprised when a senior staffer left after being passed over for a promotion, but who refused to discuss with the employee why they weren't being considered for the post.

Yup, it sure is hard to be an employer.  But you know what, it is also hard to be an employee.  How do some bridge the gap and remove the dissonance that is endemic in many of the disagreements relationships between boss and staff?  Many organizations are considered great places to work.  Is it as Tolstoy wrote of families, that happy workplaces share common traits, but that unhappy ones are unique?

Would you believe?

Do you thrive on order or disorder? Into Ccontrol or Kaos chaos?

Are you a connect-the-dots kind of manager, taking comfort in plans and processes, trusting in systems that provide structure to move your organization forward step-by-step?

Or do you prefer a more freewheeling environment, believing that adaptability and improvisation is a litmus test that allows one's mettle to come shining through.

It's probably not a question that business owners ponder very often, but it came up in conversation a number of times this week, speaking with prospective TAB Board members about their approaches to managing their companies.

Some of those I met with professed to love the challenge of dealing with constant change, navigating a stormy environment and choosing the correct tack to keep forward progress going.  Others, well, not so much. They preferred a more grounded and gradual approach.

I'm sure you know successful executives in both camps. Today's entrepreneurial zeitgeist certainly reflects more of the swashbuckling, freewheeling, disruptive business type. And, while the it may be a more sexy story, would you believe that this approach yields worse outcomes than the old-school methodical, follow-the-plan approach?


As Jim Collins illustrated in his book Great By Choice, a discipline he calls "20-Mile March" behavior is a leadership trait that gives organizations "the ability to impose order upon disorder, consistency amid swirling controversy" but only when it is combined with a near obsessive focus on making continued progress against the objective.

According to Collins:

"Some people believe that a world characterized by radical change and disruptive forces no longer favors those who engage in consistent 20-Mile Marching. Yet the great irony is that when we examined just this type of out-of-control, fast-paced environment, we found that every (successful) company -- unlike their less-successful peers -- exemplified the 20-Mile March principle during the era we studied."

Collins relays the expeditions of Roald Amundsen and Robert Scott, two well-matched teams racing for the South Pole.

"For one team, it would be a race to victory and a safe return home. For the second team, it would be a devastating defeat, reaching the Pole only to find the wind-whipped flags of their rivals planted 34 days earlier, followed by a race for their lives -- a race that they lost in the end.... One leader led his team to victory and safety. The other led his team to defeat and death....What separated these two men? Why did one achieve spectacular success in such an extreme set of conditions, while the other failed even to survive?"

Find Collins' answer here.

The difference between success and failure is often small, with progress sometimes barely measurable and perceptible only in hindsight. Most often it is the result of a series of incremental actions and decisions rather than any single event.  Having a well-drawn plan, combined with the temperament and leadership skills to implement it consistently, even in the face of adversity, gives your organization a demonstrable edge over more flamboyant but less dependable competition.

Missing by that much may make for comedic gold, but it is often not so amusing in life or in business.  Believe it.

The stuff of dreams?

My cousin is married to a musician of some note in certain musical circles. A blues and R&B bassist, "Choppy" performs with several bands and we try and catch him at his local shows whenever we can.  This past weekend, he and friends played a gig in Hudson.

One of their pieces was a raucous, bluesy cover of the country standard "16 Tons" that segued into the Eurythmics' techno-pop hit "Sweet Dreams (Are Made of This)," that they stripped down and rocked out.  They synthesized two seemingly discordant musical styles and schools into a jam that brought the house down.  Smartly, the bartenders chose this moment to pass around the tip hat.  Naturally, this got me thinking about finances.  Small business finances, specifically.

I have met with several business owners lately who have not taken advantage of opportunities that would accelerate their growth.   They each had reasons:  uncomfortable funding the investment from their equity, uneasy about diminishing their cash flow, unwilling to take on debt.  It made me wonder, have even entrepreneurs become too risk-averse when it comes to employing all options for financing growth?



In the aftermath of the financial crisis that began in 2007, debt has become a figurative four-letter word (it already was a literal one.)  There's no argument that we had a debt binge in this country (globally, actually) and that our economic challenges are attributable in large part to postponing working through the necessary deleveraging process.

As marketer Seth Godin once noted:  The guy who invented ships also invented shipwrecks.  Thankfully, the perils of sailing did not scuttle seafaring.  Has the pain of the debt bubble created a mindset that is too limiting where debt financing is concerned? 

Access to debt financing can be a powerful force for small business growth.  It has ever been thus.  It is called leverage for a reason:  small amounts can have a powerful effect.  If you've kept good books, are profitable with a history of good cash flows (and have good credit score), banks and community lending institutions will and want to lend to you. 

Capital is the essential lubricant of commerce and for small businesses it is practically the elixir of life. Yet some now view debt as if it were unicorn blood, extracting a terrible toll for its employ. Smoothing out the cyclicity of cash flows rather than being hamstrung by them is smart financial management.  And the right debt can often be cheaper and provide more operating flexibility than equity capital.

Tennessee Ernie Ford may have lamented debt "to the company store" as an unholy burden, but for smart business owners, it is the stuff of which sweet dreams can be made.

Don't fear the reaper

Donald Trump insinuated himself into the American psyche and lexicon with his signature bellow: "You're fired." His show, The Apprentice, had a good run before, as with many things Trump, it descended into caricature, evoking petitions for The Donald himself to be axed.

While Trump's exterminator persona may have raised the eyebrows of kinder and gentler executives, not all disagree with his methods. One business owner I know advises:  "the best time to fire someone is the first time you think of it."

Unrealistic, pig-headed, cold-hearted and self- destructive?  Perhaps, (and word does get around about bad bosses these days) but terminating problematic employees is not a matter for the meek or mild mannered.

The above owner's snarky remark belies pragmatic thinking: if an employee is giving you reason to question their continuation, you'd better gear up for an exit sooner rather than later. A prepared mind, and all that.

 

Trump notwithstanding, I don't know any business owners who relish the task of relieving anyone of their livelihood.  However, I have personally witnessed instances of owners extending an employee's tenure to the point that their business was gravely affected.  Not just by the brilliant jerks, whose contributions often mask their destructiveness, but by those who are chronically under-performing, disrespectful, deceitful and, in some cases, criminal. Bad apples, in other words.

What to do?  Here's how to cowboy up, pilgrim:

• Document, document, document:    You may think it is tedious and unnecessary, but you would be wrong about the latter and immature about the former.  Did I mention write it down? Like, yesterday?

• Get good advice:  If you don't have an HR advisor or employment lawyer, don't be penny wise and pound foolish.  Talk to a pro. Stat.

• Process is your friend:  You must discuss issues with the employee, and detail a plan of remedial action.  Have a plan and procedure and follow-it. Don't freelance or improvise.

• Rehab your culture:  I have worked with a number of organizations who flourished after problem employees were exited.  This occurs only when and if owners allow an honest dialogue to occur after the dismissal.  These conversations, if conducted respectfully but openly, can rebuild trust that may have been lost through inaction or complacency.

No business owner likes admitting to a hiring failure -- it's contrary to entrepreneurial DNA -- and many take employee issues personally.  Get over it.  If you have an employee who needs to exit your company, you must act decisively and deliberately.  Chronic bad behavior that goes unchecked is a cancer within any organization.

Don't fear the reaper.

Swing and a...

Baseball's spring training has commenced.  I know this by the calendar, and by the fact that I've been hearing baseball cliches more frequently in recent business meetings.

"I've told my people that I want them to be more aggressive.  Have a plan and swing the bat," one CEO told me recently. "It's OK for them to strike out, but I want them swinging."

This statement brought to mind the 2006 National League Championship Series (NLCS), when NY Mets outfielder Carlos Beltran was at the plate in a situation that many who play baseball dream about:  deciding game, bases loaded, two outs and the winning run on base.

Chances are...

The 1974 film Blazing Saddles is considered one of the great American comedies.  A satire not only of movie westerns, but also of American popular culture, many of the movie's scenes have become classic.

One of those highlights was the late Madeline Kahn's performance of "I'm Tired" a comic lament to over-abundant but largely unfulfilling opportunities:  "I'm tired of being admired..."  We should all have such problems.

The song came to mind this week during discussions with business leaders about coping with the endless series of decisions they must make to keep their organizations moving forward.  Being fatigued was a common complaint.

Indeed.  We've all had those days where we have felt so bombarded by incoming requests that by day's end we feel paralyzed or simply unable to process even a simple request like: "Honey, what do you want for dinner?" without risking a domestic violence charge.

Who loves ya, baby?

Dear John,

I know that we’ve never paid much attention to the Valentine’s Day thing – it’s not like it’s a legal holiday and all – but I couldn’t let it pass without saying how much better things are between us. What a difference a year makes!

Last winter, I thought we were on the rocks, heading towards being done. You weren't yourself and it seemed like you were just going through the motions. 

You had been caring, upbeat, positive, full of ideas.  We were a hot item. Everyone talked about us. You were proud. You loved every aspect of running your business.

I know that the never-ending "recession" wore you down. I could see it in the little things, those small gestures that showed that you cared: studying the day’s orders to get a feel for what who was buying what: you could spot changes before they became a trend; “buddying” up with a new employee to get them up to speed, then staying late to catch up on your own work; going to Chamber events and coming back with orders, not just a few business cards that you threw into a pile.  I was worried, and I know you were too, though you didn't speak about it.

Deja vu all over again

Two great American pastimes intersected this past weekend:  weather prognostication and football, in the forms of Groundhog Day and Super Bowl Sunday. 

Both are now spectacles that have evolved far beyond their humble beginnings.  Regarding the Super Bowl, I am always awed by the sheer magnitude of this often-not-so-special event.  Some big facts about the 2013 Super Bowl:

• 7.5 million TVs will be bought for the game.
• Nearly $4 million will be spent per 30-second ad during the game.
• 1.2 billion chicken wings will be consumed and 50 million cases of beer will be quaffed.
• 2 billion gallons of water will be used to flush those wings and beer away.
• 7 million people will call in sick on Monday

Groundhog Day is a less over-the-top affair, even in Punxsutawney, and whatever the predicted outcome.  Whether early spring or more weeks of winter, February 2nd heralds repeated opportunities to catch one of my favorite movies, Groundhog Day.  It's a classic American business morality tale.

Going for it

In baseball, there's a saying, "You can't hit a five run homer."  It's an admonition to players that a deficit has to be overcome one batter at a time, and to focus in the moment, rather than project forward.  Contribute your part; let the next guy do his.  Some call it "small ball." Or deride it as incrementalism. One of the most memorable moments in American sports was built on such small steps. (Relax, Red Sox Nation, you had your moment.)

The debate over "big play" versus "march down the field" has raged for eons...in and out of sporting arenas.  Think tortoise v. hare, a fable from Aesop and ancient Greece.

It's true that sluggers are traditionally more revered by fans and big-armed quarterbacks capture more imagination than a great cover corner back.  We have home run derbies at the All Star game, not doubles up the gap contests.

But do the bombers win more?  Do they contribute more to success than well-rounded excellence?  Not according to some.  The book and film Moneyball, which is about management as much as it is about baseball, is a recent contributor to this debate.  In the world of big business, the go-for-broke and grind-it-out camps each have visible success stories.

Is grease the word?

"I hate to be a kicker,
I always long for peace,
But the wheel that does the squeaking,
Is the one that gets the grease."
 -- Josh Billings, "The Kicker," ca. 1870

I'm sure that most of you are familiar with the "squeaky wheel" adage, the origin of which is credited to the poem above. Josh Billings was a 19th century American humorist, second in popularity in his time only to Mark Twain.

For business owners, the Squeaky Wheel syndrome is no laughing matter.  You want happy customers, not disgruntled ones. Organizations go great lengths and invest great sums to ensure that their organizations not only understand best practices but execute them flawlessly.  Some succeed, some don't: There are both customer service Halls of Fame and Halls of Shame. 

In a recent discussion about the book Raving Fans, a bestseller about how to make great service a competitive advantage, business owners discussed how they instilled and practiced the "customer first" mentality in their companies.



One retailer described how he sends notes and small gifts to customers who have had issues, whether real or imagined.  Asked if she did this for all unhappy customers, she replied "no," but more often than not.  Then she was asked what she sends her "best" customers...the ones who buy most frequently, spend the most, are most active on the company's social media pages.  After some uncomfortable, but thoughtful silence, the answer was, "nothing, but that will now change." 

Squeaky wheels surely need attention.  But make sure that the silent wheels, the ones carrying the load for your business without issue or complaint, are well cared for and properly maintained.  You may not always hear them, but you'll notice them when they are gone.  And you'll save on grease, which is literally and metaphorically both messy and expensive.

On the edge

I attended a terrific seminar last week, hosted by a local professional association about which I had heard many good things.  As with many first-of-the-year meetings, the topic was planning for business generation.  The room was overflowing.

The presenter did an excellent job of building participation and conversation:  she didn't talk at the audience, but rather made a few points that led to interaction among the participants...sharing of information...making of connections, etc.  Attendees left the meeting animated and motivated.  Who could ask for more for on a January Friday afternoon?

There was one statement that the presenter made as she exhorted the crowd to develop personal marketing plans that was a lone discordant note in a otherwise resonant and well-orchestrated presentation:

"Your mother and grandmother were wrong: Humble does not work."

Is that true?  The antonyms of humble include arrogant, chesty, self-important, beaming, swelled, vainglorious, big-headed, persnickety, snooty, snot-nosed, stuck-up, too big for one's breeches, boastful and braggart.  I don't think those qualities are what the presenter would recommend as keys to winning friends and influencing people.  Unless you're running for Congress.

Business professionals today face a conundrum.  There is no question that while the ability to connect is growing exponentially, it is also harder to gain visibility and capture attention.  So we're resorting to stunts, gimmicks, the outsized and the outlandish and labeling it "edgy" to rationalize our actions.

Grappling and growing

My oldest son was not an athletic child.  Growing up in Manhattan, he was an urban street kid and possessed a dexterous rather than physical prowess.  This manifested itself in highly individualist forms: yo-yoing, card tricks and magic.  Brains over brawn stuff.

When we moved to "the country," these unique skills gained him instant visibility with his new peers and helped him to forge new connections.  They didn't alter the reality, however, that his new friends were much more interested in sports than sleight-of-hand.  He had a decision to make.

So he chose to wrestle.  Not an easy sport to jump into, given that many of his teammates (and competitors) had been in programs (who knew?) since grade school. He spent his first year getting beaten pretty badly, which for him was a singular and disorienting experience; he had no prior experience on which to mitigate the helplessness he felt.  It was not just the losing, he said, but more so being unable to figure out how to stop losing. He couldn't just think his way out of it and was frustrated about not being able to apply what he was learning in actual competition.

Fast forward a year:  he has as many wins as losses; placed 2nd in a 12-team tournament over the holiday, and last week pinned a more experienced opponent in less than a minute on what his coach called, "a beautifully executed move."

The path you choose

The word entrepreneur is not of modern vintage.  It is about about three centuries or so old, and not of English origin.  According to Wikipedia:

"Entrepreneur is a loanword from French and was first defined by the Irish-French economist Richard Cantillon as the person who pays a certain price for a product to resell it at an uncertain price, thereby making decisions about obtaining and using the resources while consequently admitting the risk of enterprise. The term first appeared in the French Dictionary "Dictionnaire Universel de Commerce" of Jacques des Bruslons published in 1723."

In the original definition -- a reseller or middleman -- the word entrepreneur hardly conjures up the glamor and symbolism that are associated with it today: a world of Valleys, Alleys, start-ups, venture capital, IPOs and potential riches.

Despite the pop culture mythology attached to modern entrepreneurs, life for most business owners is more mundane than commonly portrayed. They are a practical lot, more concerned with making payroll than the size of their bankroll.

And even though Americans like to think we are the masters of commercial risk-taking, we aren't even the most entrepreneurial society.  Be that as it may, both the uncertainly and the "risk of the enterprise" surely remain the same as it ever was.

For many, the difference between success and failure comes down to how well they "make decisions about obtaining and using resources." In other words, the path they choose to get what's in their head (vision) into operation (execution) in their business in a way that allows them sufficient sustained profitability to endure.

An enemy of one?

About two thousand years ago, a Chinese general named Sun-Tzu wrote a 13-chapter tract about the martial arts and warfare, entitled "The Art of War."

While I am sure that he was, as many leaders tend to be, very self confident and at least a touch self-centered, I am equally sure he didn't envision his treatise becoming a best-seller for business leaders a couple of millennia hence.

The Art of War is widely quoted and cited on a range of business topics, from general management to sales to human resources, and has become synonymous with the melding of strategic and tactical thinking.  One of the most famous lines speaks directly to that: "Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat."

But Sun-Tzu also believed that engaging in war was a fool's choice, "Anyone who excels in defeating his enemies triumphs before his enemy's threat become real."   He also said: “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but know not the enemy, for every victory gained you will also suffer a defeat.  If you know not the enemy or yourself, you will succumb in every battle.”

In other words, get to know yourself and the battle is won.

Last week I listed five steps to achieve greater focus for yourself and your organization which I have learned from working with successful business owners and CEOs.   In more depth, they are:

Crossroads

In last week's post, I wrote:  "In the weeks ahead, I'll outline ...  an "Owner's Manual" for 21st century small business leaders."

That wasn't entirely accurate.  What's follows over the next few weeks is not a manual, in the truest sense of the word:

Manual [ˈmænjʊəl] adj 
[via Old French from Latin manuālis, from manus hand]

1. of or relating to a hand or hands

2. operated or done by hand manual controls

3. physical, as opposed to mental or mechanical manual labour

4. by human labor rather than automatic or computer-aided means

5. of, relating to, or resembling a manual

n

1. a book, esp of instructions or information a car manual

2. (Music, other) Music one of the keyboards played by hand on an organ

3. (Military) Military the prescribed drill with small arms

Collins English Dictionary – Complete and Unabridged © HarperCollins

The problem with manuals is that they are so, well, hands-on, in a more or less literal sense, AND they are very basic (find key, put it in ignition, turn on car...) Manuals tell, rather than teach.

What I have found from working with business owners, CEOs and organizational leaders for over 30 years is that the best seek not a how-to, but a map, a compass, a guide to help them navigate.  They are constantly trolling for new experience and expertise and they want guidance on better managing themselves and their businesses.

Born to run?

One of the high points of my former life was making a presentation to the Board of Directors of an iconic US company (a revered household name that will remain nameless until you buy me a drink.)  The company and its CEO had gotten into hot water with investors, and we were briefing the Board on recommended strategies and a series of specific actions to rebuild trust.

The Board consisted of a proverbial pantheon of international business leaders.  Following our presentation, we had a lively discussion of our recommended strategies, as you would expect of this group, one of whom was the CEO of a giant global engineering company.  He lasered in on the tactics, specifically how my CEO client would oversee implementation.

During the back-and-forth on that topic -- my client stated that he would approve the final plan and leave implementation to his staff --  it became clear that the engineer operated his company differently,  through tight, personal command-and-control, down to such minutia as final approval of all press releases.  He confessed as much.

Astonished, a fellow Board member asked, "G----, how do you find the time to lead your company if you're doing all of this work?"  It was a extraordinary moment.  (This chief executive was later dismissed by his Board.)

The half of it

There are probably not many who don't know the old adage about the half-filled glass: that the optimist sees the glass as half-full, while the pessimist views it as half-empty.

That aphorism has been extended in many ways: An economist would say that, adjusted for inflation, the glass is 10% less full than two years ago; a banker would say that the glass has 50% of its net worth in liquid assets; politicians would say that it would be fuller if you vote for their programs, and a private equity investor would say that they could get rid of the excess glass, then fill it back with a bit of leverage.

And finally, some would over think it altogether.

In the days leading up to the Thanksgiving break, there was much to-and-fro about the state of the world:  the results of the election, the fiscal cliff, a world without Twinkies, Black Friday, Small Business Saturday, etc., etc., ad nauseum.

While those of us who prefer not to live in caves or with our heads in the sand have more than a passing interest in the news of the day, fixating on macro issues is mostly a distraction, and finding the truth is as elusive as ever.

School's in

Discussions at our monthly TAB Board meetings are usually both deep and wide-ranging, as you might expect from a gathering of business owners and CEOs who've come to "talk shop."

From initiatives to ideas to strategies for implementing same, the conversations can get intense.  Board members are focused on improving their operations and their ability to manage the constant change that comes from that striving.  As my colleague John Dini wrote this week, while failure may indeed be an option, in order to succeed, good enough never is.

Or as C.S. Lewis said:  "Experience is a brutal teacher.  But you learn.  My God, do you learn." 

Some lessons from the field, from the mouths of CEOs:

• Follow the money: When analyzing sales results, "Follow the money."  Poor closing rates usually mean an inability to ask for the sale (the money) or to get to the decision maker (the money.) Find out which it is and coach to correct.  Or find someone who wants to follow the money.

• Focus on focus: When assigning new initiatives or tasks, always ask two questions: "What do you need to perform this and what do I need to take away?"  This helps focus yourself and your staff on the resources and commitments needed to execute the task and also generates buy-in.  Both are critical to successful delegation.

By the numbers

"In the end, it should always come down to the maths."  That was the wisdom of my sixth grade teacher, Mr. Balsam, who spoke about mathematics the way the Brits do -- calling it maths instead of math.  (He taught there for a couple of years in the 60's, before coming back to the colonies.)

The point he was making is that a facility with numbers is essential to proper decision making, by providing an orderly and logical underpinning for sifting through the information that bombards us.

So, I am sure that Mr. B was pleased that math was one of big winners in last week's election, according to Smithsonian Magazine's Smart News blog:

"New Yorker reporter Ryan Lizza said this morning that after months of campaigning, the result of the 2012 election “was a huge victory yesterday for math.” Wired called 2012 “the nerdiest election in the history of the American Republic.”'

How many times does a comic referencing math go viral?  This one from the online comic site XKCD, did (it was mentioned in the above story):

Uncorked

It's November. Halloween has passed, we've turned the clocks back and daylight hours are fading fast.

In other words, it's that time when a business owner's thoughts turn to planning.  Our TAB members are working on securing this year's successes and focused on defining their priorities for 2013.  Happily, most of our businesses have seen gains this year, as is the case with many owners who are part of a knowledge-sharing group.

While each business plans in a way that is unique to it, I have found that the ones that are most successful in achieving their goals share some common approaches:  they focus on fewer, but very specific goals; they set hard targets and timelines; and they lead their organizations to the achievement of the goals without doing the work themselves.

When leading planning discussions, I like to start with three baseline questions:

• What are your three priorities for 2013?
• What resources do you need to achieve them?
• What do you need to stop doing to make them happen?