Situation: A CEO perceives that the company has a conflict between performance and planned timelines. Of concern is performance against key metrics like pipeline performance and closing new business. A sense of urgency isn’t present. How do you create and communicate urgency?
Advice from the CEOs:
Management knowledge of company financial status and performance against key metrics – particularly key drivers like pipeline performance – is critical to their being able to assist the company.
A company decision to focus on project profitability may have the unintended consequence of exacerbating the lack of urgency. If revenue growth lags, the only option for managers who are tasked to hit a profitability target is to cut expenses. This delays projects and can negatively impact morale.
Accountability comes from meetings. Not 1-on-1 meetings but team meetings. Peer pressure is an important component of accountability. Nobody wants to be the individual who is consistently behind on projects or initiatives.
The challenge may be more external than internal. When business closes more slowly then everything else slows down: hiring, new development, investment and profits. All of these are driven by new business acquisition.
Another CEO has same issue with her contracts. All contracts include a timeline. If work or deliverables slip, the customer wants to slow down delivery and billings. Her solution is to include stop work and delivery delay fees in the contracts.
What actions would others take to address this?
Institute progress payments. For example, instead of charging 50% up front and 50% on contract completion, shift to, for example, 50/30/20 with the 30% due on completion of project framework. This way, only 20% can be delayed due of customer timing issues.
Built financing into total pricing. The customer is free to delay projects, or aspects of projects, but there is a charge calculated into delayed delivery which covers the cost of money and additional management.
Situation: A CEO has observed an increase in the frequency of demands for last minute meetings from an important foreign client – sometimes with 12-18 hours’ notice. Requests for these meetings are often the evening before the requested meeting and with no regard to preexisting calendars. The client always says that they have sound reasons for the request. What are the likely consequences of push-back? How do you respond to unreasonable client demands?
Advice from the CEOs:
While allowance must be made for specific circumstances, there is a tendency within some cultures to press for special consideration. Part of this may be a negotiating tactic. One CEO has found that when he pushes back, the side requesting special consideration often yields to his needs and backs off the special request.
Treat these as you would similar requests from a domestic investor or client. Point out the late call and that you are already booked for the time requested. Ask whether there is any flexibility to the requester schedule and offer available time alternatives. Listen closely to the response and proceed accordingly.
Depending on the importance of the client and individual calling, some CEOs prefer to comply with requests like this, at least the first few times that such requests are made. However, when the requests become a regular occurrence, as described above, they rely on the recommendations outlined above.
Situation: A company wants to develop a better planning and execution process. Historically they have been poor at meeting goals and objectives. What are the most important factors that improve planning and execution in your company?
Advice from the CEOs:
Take the advice of Jack Stack in his book The Great Game of Business. When building a plan, do it as a company-wide exercise.
Make sure that all of your departments are involved, each has direct input into the development of its own goals, and each understands that they are fully accountable for the achievement of their own goals.
Also do this in open session, and assure that each department has the input of other departments whose activities are critical to the completion of each goal.
This assures that different departments are working in alignment and not against each other.
Finally, make the process interactive and add some fun so that everyone is engaged.
Milestones and meetings are critical. Each department develops quarterly goals to support the plan, and department heads meet bi-weekly to monitor progress and prevent conflicts. Revisit the plan on a quarterly or semi-annual basis to adapt as necessary.
Focus the plan on one-year performance – with quarterly objectives – but forecast financials and broad metrics out 3 years to assure that the 1-year plan supports long-term objectives.
Situation: As a company has grown to multiple sites around the world they have lost some of the culture that originally bound the company together. Many new hires are hired locally by regional managers and don’t have a strong bond to headquarters or the broader company culture. How do you build a unified culture in a company with many geographically diverse sites?
Advice from the CEOs:
Company culture starts with a common set of values. These values should drive everything, from hiring, through on-boarding and training, to performance measurement and evaluations. In a strong company, these values should be reinforced regularly and expressed in the day-to-day behavior and decisions of the company.
Look at how you hire new personnel. Is alignment with company values part of the selection process?
Next, look at your on-boarding and training process. Company values and culture should be thoroughly expressed and reinforced in the training process.
There is no substitute to face-to-face meetings to build shared company values and culture. At least once or twice a year you should host national meetings that bring the regions together. At these meetings company values should be reinforced, there should be business content, and there should also be recreational bonding component to help employees get to know one-another.
Consider an annual reward or recognition trip or special event, and include spouses at company expense. This creates a completely different level of bonding, and spouse involvement communicates a company commitment to the families of the employees.
If you have a large number of locations, you should also have a human resources department. Among the important responsibilities of the HR department will be developing uniform selection criteria, uniform training which includes emphasis on company culture and values, and assistance in planning national or multi-regional meetings.