Tag Archives: Key

How Do You Boost Intensity and Accountability? Five Solutions

Situation: A CEO is concerned about the intensity and accountability of her team. An employee stock ownership program is in place, and employees are rewarded with bonuses for meeting or exceeding objectives. HR reports that there is a lack of decision-making; employees just sit and talk instead of moving forward. How do you boost intensity and accountability?

Advice from the CEOs:

  • Does the current bonus structure include revenue growth? If revenue growth is not part of the incentive program, then this won’t be the focus.
  • What happens when the CEO is away?
    • Assure that the #2 who’s in charge has the same sense of urgency as the CEO and has the confidence to make decisions.
  • The company is at the point where it needs seasoned professionals to run key operations and functions.
    • Ideally this would be an internal promotion, but if there is no internal candidate look to hire from the outside. Hire two new managers – for different teams. Watch how they do with each of their teams to determine whether one can run the whole outfit.
    • This can ignite other employees – those who will catch on to what the new manager is doing and will now get the message.
  • Another CEO empowered people and explained how it worked.
    • They have had to swallow some poor decisions but have learned that they can’t come down on those who make mistakes – it discourages them from taking the risks needed to make decisions.
    • They’ve organized strategic teams to develop the empowerment program with minimal input from top staff. Teams are required have to report on their results 2x week – no exceptions.
    • The CEO hired two key hires who are hard hitting with deep resumes and experience – individuals who have shaken things up.
    • The new managers started in a sheltered situation where they could learn the organization and the people. This was done before they were put in their eventual positions.
  • What are the potential downsides to making this kind of change?:
    • Some sparks will fly.
    • Some will get upset.
    • Be patient with this process – let it happen.

[like]

How Will Your Personal Plans Impact the Company? Six Points

Situation: A CEO, for personal reasons, is planning to move to another state. While he will remain CEO, he is concerned about the potential impact of this decision on the company, particularly the fact that he will not be present personally to handle matters that arise. What can he do to alleviate this concern? How will your personal plans impact the company?

Advice from the CEOs:

  • Put a stake in the ground. Set a date for the move and work backwards to see whether this is attainable.
  • Have a discussion with the company’s key managers.
    • Empower them to challenge the date.
    • Discuss this as a brainstorm to plan the future and what must be done to get there. Once a plan is established retest the timing.
  • Consider this as a gradual transition. Start 3 weeks here / 1 week there, and gradually transition to 1/3. This will help you to determine how the company performs absent the CEO’s daily presence.
    • Move family but keep a small place here. Start the transition now and figure out balance. Do what is necessary.
  • Have the key managers transition their roles before initiating the move.
    • This will provide confidence that they can handle this transition.
  • As part of the process, look at areas where the company can use more support. For example, is HR up to snuff? What about information services or financial management? Prior to initiating the transition take steps to fill any gaps.
  • Does the company have a formal metrics structure?
    • If not, establish one and in preparation for the transition see how the two managers manage this.

[like]

How Do You Develop an Employee to the Next Level? Four Points

Situation: A CEO has a key employee who wants a higher level of responsibility. Currently this employee is primarily focused on business development. He’s good at this but wants a higher level of experience. The CEO agrees. How do you develop an employee to the next level?

Advice from the CEOs:

  • If you ask this individual what needs to be done, what happens?
    • Revenue is number one. This is where he is focused, but he wants more than this from his role.
    • If this is also the CEO’s primary objective then the CEO needs to back off and direct him to split his time between closing high level opportunities and training his direct reports to be able to close lower-level opportunities on their own.
  • To the CEO – thinking about your own experience, how did you mature to a higher level when you had primary responsibility for business development?
    • Answer: I built and trained staff to do this and delegated these responsibilities to them.
    • Allow this individual and other key managers within the company to do the same thing, and coach them along the way.
    • Empower this individual to build his staff and enable them to take on more of the functions that he no longer wants to handle himself. Allow him to prioritize his time to focus on: hiring and training of his key staff and coaching and supervision as they grow into their new roles.
  • Consider this solution as a larger project manager role. Take a key product and empower this individual to design, build and manage the organization to deliver this product.
  • To frame this solution short-term, start with a 1-on-1. Ask about his vision – what he wants as his role and how he sees building this.
    • Follow by laying this out in terms of the company’s objectives – be specific as to what this looks like.
    • Look for a win / win reconciliation between the CEO’s and the employee’s visions that meet both of their objectives. Get on the same page with this individual, so that this fulfills both of your needs.

[like]

How Do You Grow Knowledge Workers into Servant Leaders? Three Methods

Situation: A company’s staff is made up primarily of knowledge workers. These are highly skilled individuals who excel in their roles. The CEO wishes to shift their focus to servant leadership – where the focus is the growth and development of the company. How do you grow knowledge workers into servant leaders?

Advice from the CEOs:

  • One option is to create a different set of incentives. Offering key managers the option to invest in and hold shares in the company will change their perspective. This, in turn, can change their behavior because servant leadership will improve company performance and the value of their shares.
  • Another option, used by Accenture and many Fortune 500s, is to hire a lot of the best and brightest individuals that they can find out of college and see who rises to the top.
    • The ratio in large firms is generally 15 hires to produce 1 high performer. Another CEO at the table is now shifting to this model at his company.
    • Create an entry level position for recent graduates that will allow for this sifting without disrupting the company’s culture.
    • Speed identification and retention of the best talent through annual evaluations of the company’s talent. This includes ratings by employees’ supervisors of both how the individual is doing and their ultimate potential within the company.
    • Be aware of the downsides to this model. One is that the two groups that tend to leave of their own accord are the best and the worst employees.
  • A third option is to create two career tracks within the Company.
    • One track is upwardly mobile. This is the track that identifies, develops and grooms future servant leaders.
    • The other track is a specialty track, which can produce servant leaders along a different dimension – breadth of experience and expertise in key skills of value to the firm.
    • This second track also allows for growth, characterized by levels of title, salary and recognition that reward the acquisition and perfection of skills in key disciplines.
    • Several “kinder, gentler” environments such as 3M have used parallel tracks with great success.

[like]

What’s Your Exit Strategy – Both Timing and Price? Four Considerations

Situation: A CEO is considering an exit strategy for the company that she founded. The company has been very successful, and the CEO wants to optimize the value of the company on sale. She seeks advice on how to both maximize the company’s value and how to best prepare for a sale. What’s your exit strategy – both timing and price?

Advice from the CEOs:

  • Value is tied to revenue and profit growth. Revenue growth is based on expansion of the customer base and reshaping the product offering to optimize its market appeal.
    • Consider a usage-based price for the offering. Accompany this with a range of usage offerings based on current customer use patterns.
    • Consider tiered pricing or pricing/use to access lower tiers of the market.
    • Consider bundled products, for example along with complementary products of another company with whom marketing partnerships could be formed.
  • As part of the valuation exercise, determine the best exit strategy and timing:
    • Identify the companies that could be buyers.
    • In each case, identify why they would buy the company.
    • The most compelling reason to purchase the company will be strategic, not financial.
    • Identify the key decision maker in each of the potential buyers.
    • Also identify any factors that would make the company less desirable to any potential acquirers and develop remedies for these.
    • This exercise may help to plan the timing and to understand more about the price that could be fetched.
  • To appeal to a buyer, optimize the organizational chart.
    • If the CEO occupies too many seats on the chart this presents a substantial risk to an acquirer if the founder leaves.
  • Evolve the organizational structure to support growth.
    • If there is no compelling reason to sell in the near term, then staff the company with professional marketing, financial talent, and so on.
    • A lack of talent in key positions limits both the company’s growth and its appeal to potential buyers.
    • In the case of this company, the most important hire will be in marketing. Note that marketing does not equal sales. The company is creating a market and convincing people to change their habits. This is a marketing task, not a sales task.
    • If the analysis of the factors mentioned above determines that now is time to sell, then stay slim.

[like]

How Do You Maintain Your Culture as You Grow? Five Points

Situation: A company has been growing well and has developed a solid culture. Currently a key individual has decided to leave the company and has said that he is uncomfortable with the company’s culture and values and feels that he could make more money elsewhere. This has caused the CEO to question how he maintains the company’s culture. How do you maintain your culture as you grow?

Advice from the CEOs:

  • The individual who is leaving was the wrong person for the company. The company is lucky that he is leaving.
    • As this individual departs the company, conduct an exit interview and listen closely to what he has to say.
  • Develop a simple statement of the company’s culture. This is not the current vision and mission but is a statement that represents the core values to be maintained by the company and staff.
    • This will help to identify and evaluate new people as they are brought onboard.
    • It will also help to guide the company as it faces both new opportunities and the numerous business choices that will be encountered in managing both current business and future growth.
    • As an example, J&J’s “Credo” starts: “We believe our first responsibility is to the doctors, nurses and patients, to mothers and fathers and all others who use our products and services. In meeting their needs everything we do must be of high quality.”
    • This statement of values guides everything that J&J does and saved them as they formulated their response to the Tylenol scare.
  • The team leads are the key to cultural fit. They determine whether the culture of their teams is consistent with the culture of the company.
  • Look at the culture of subgroups within the company. These have a huge impact and represent areas where the company truly excels.
    • Microsoft excels at managing software development but does not have the skill set to manage networks – nor do they care to develop this. Focus on what the company’s leadership are staff are best at doing.
  • From what has been said, it appears that the company was founded:
    • To create a professional work environment – to the founder’s standards; and
    • To be of uncommon value to the company’s clients.
    • If leadership conforms to these two standards, they will guide decisions about new opportunities and directions. Either a particular choice fits these standards, or it does not.

[like]

How Do You Rapidly Ramp Sales? Three Tactics

Situation: A company’s key marketing partner has excelled at analyzing key potential customers, the right decision makers within those customers, and completing sales to them at a premium price. The CEO wants advice on what more they can do with this partner to leverage and boost sales. How do you rapidly ramp sales?

Advice from the CEOs:

  • The company’s current strategy is to start a customer on the company’s product to add additional functionality. Once the customer learns to use the product, they work to extend the customer to other products from the company.
  • It is difficult to win with a “push” sales strategy. The situation described is like that of Linux competing with Microsoft. Everyone knows how to use MSFT, and for most of what they do MSFT is good enough. It takes a particular level of pain or need to justify the pain of transitioning to something different.
    • The only alternative is to show a significant pay-back for the pain that the customer must endure in order to convert, large scale, to another solution.
  • The company’s target customer will be the key manager who will shut down the line because they don’t have the company’s solution. This forces the purchase decision above the manager’s boss to the executive suite. The company’s solution then becomes the alternative that saves the day.
    • Seek a forum or trade show that will put the company’s solution in front of these key managers. Through this venue, create buzz that will make the company’s the booth to visit.
    • It is critical to have a compelling story for potential users when they respond to this gambit and visit the company’s booth.
  • The solution to this dilemma is the same as the solution to the company’s overall strategy.
    • The company’s offering, at this point, is just another alternative available to the customer. While the company has a compelling product, it is not world changing and the company lacks the market presence to make its solutions first to adoption.
    • The solution is to focus. Stop what the company is currently doing and take the time to develop a technology strategy.
    • Once this strategy has been defined, focus efforts on developing the killer application that becomes the reason that people must come to the company to satisfy their need.
    • Once this killer application has been developed, positioning and gaining traction with the customer will become easier.

[like]

How Do You Keep Your Culture in the Face of Rapid Growth? Ten Points

Situation: A CEO’s company is facing rapid growth. The CEO is concerned that the cordial team culture that he has carefully nurtured will be strained as the company adapts to this growth. The present culture is characterized by lack of politics and truthful, frank communications. How do you keep your culture in the face of rapid growth?

Advice from the CEOs:

  • The company currently markets its culture, complemented by a solid history of performance. Clients receive highly personalized service at a competitive cost. This combination attracts and retains clients.
  • The company’s employees are a happy, competent group that enjoys what they are doing. This differentiates the company from other firms all by itself.
  • Identify the key attributes of the company’s culture. This will simplify internal and external communication when discussing what makes the culture special.
  • Use one several tools available to develop behavioral profiles of the current employees. This will help to understand how team members interact with each other. It will also help to build profiles for ideal additional employees as the team expands.
  • Hire an expert do a formal evaluation of the team around individual and group dynamics, as well as bottlenecks in the current structure and culture. This will help determine how scalable the company’s current culture is.
  • Grow at the rate the company’s culture allows, not at the rate that salespeople bring in new business. With gradual, careful growth size will less of an issue as it would be if the company were to simply grow as fast as possible.
  • The more the company grows organically – through additional business from existing clients – the fewer additional clients the company needs to meet growth objectives. This means adding fewer new employees to maintain target client/employee ratios.
  • If the plan is to grow larger, consider growing around core groups of 9-12 employees, perhaps in distinct locations with good communication between the groups. In the military, operating groups are 9 to 12 soldiers; the more specialized and highly trained the group the more it tends toward 9 soldiers instead of 12.
  • There is a Zen saying that a healthy tree grows as tall as it can. Use this as your guide.
  • The key role of the CEO is as CCO – Chief Culture Officer!

[like]

How Do You Get the Right People on the Bus? Six Points

Situation: A small company is growing nicely and needs more people. However, the CEO is struggling to find the time to properly interview and hire additional people. In addition, he is not comfortable in this role. Hiring the right people will be critical to the future success of the company. How do you get the right people on the bus?

Advice from the CEOs:

  • Particularly if the CEO does not feel that hiring is a strength, hire an outside HR firm or consultant to screen and select candidates for interviews.
  • It is critical to decide, in advance of any search, exactly what the company needs in the individuals that are hired. A good HR consultant can help the company work through this.
  • Structure the agreement with the HR professional so that they are paid based on successful integration of the individual into the company. It may cost more on the back end for this type of agreement, however, it will save the CEO and the company valuable time and money far in excess of what the company will pay for this assurance.
  • Plan to only see the final candidates.
  • What does the company look for in an HR consultant relationship?
    • Generation of a job description and the key traits of the individual that the company seeks. This helps the HR consultant to select the right candidates for the business and situation.
    • Candidate recruitment, screening, and selection of final candidate(s) for company review.
    • The HR consultant will also prep the candidates to succeed in the company’s environment.
    • Assistance in identifying the key objectives and metrics that will be used to assess the success of the individuals hired during the first quarters or year in the company. If the HR consultant’s compensation is structured so that they are paid well for long-term success, it may cost the company more for the successful hires, however the company will only pay for success and will save considerable cash by averting failures.
  • In addition to making sure that the right people are put on the bus, work diligently to assure that they are also in the right seats, and that they change seats as necessary to complement the company’s growth.

[like]