I've been a bit remiss in blogging. I've been traveling much of May and June, but am happy to be back at it!
Last week I was facilitating an annual offsite planning session for an executive leadership team. The session was fantastic. We were able to redefine the mission and vision statements to make them more concise, memorable and in alignment with where they want to go. I confess however, I was a bit distracted by all the Brexit news.
On Friday, after all the votes were counted, I was stunned to learn that the U.K. decided to leave the EU. As I was driving to the offsite, I couldn't shake the deep underlying feeling that things are never going to be the same — that somehow things in Europe, the US, and frankly in the global economy are forever changed.
On the surface, it appears likely that for some time, Brexit will not affect the average person, other than perhaps providing some welcome relief from the US presidential election in the news cycles. But digging a little deeper, I think there are some pretty big implications.
The obvious one is how it effects global financial markets, but there are other significant challenges. Having spent almost 90% of my career working for companies that had global operations, including a significant presence in Europe which was almost always run out of the U.K., there are a host of unknowns that are now in play. How those operations can and should be run, impact on local employees, decisions on where to locate European HQs, and how all this affects sales and revenue recognition and currency fluctuations for trade in EU countries are just a few. One thing is sure, the lawyers are going to make a killing on fees trying to figure it all out.
There are other social and political ramifications. Scotland and Northern Ireland are already talking about new referendums to leave the U.K., other countries are launching initiatives to evaluate leaving the EU, and even our own presidential candidates are using it as a leverage point to serve their political agenda. The world map could actually look different in 2 years time.
Beyond all that, there are some interesting business lessons in this whole Brexit phenomenon. Having had the unpleasant experience of unraveling a corporate merger, I can validate that it's easier to get married than it is to divorce. Understanding these implications should give us pause before we consummate mergers or acquisitions. Like in life - don't get married to the wrong person.
Operationally, we should consider the implications of significant changes in geopolitical landscapes and how they will effect our businesses. How are trade agreements, tariffs, freedom of movement, and taxes affected by the changes in the market landscape? Do we have a change management process in place to quickly evaluate and take action should something change? How will the EU and their influence change in regards to global economic, social and political activities?
The Brexit vote is just the tip of the iceberg. When and how it's implemented and the short and long-term implications will be interesting to watch. Hopefully we will find opportunities for growth amidst all the turmoil!
I am blessed to have two, healthy, wonderful daughters. I'm even more blessed to have had my first daughter recently graduate from college - summa cum laude no less - from Texas Christian University in Fort Worth, TX. We recently traveled down to attend her graduation last week. 2 cars in tow, figuring we could pack up 4 years of college life into 3 cars (our 2 and hers - she's female after all) to get her moved back home. But in life, as is often the case at work, things don't always go as planned.
2.5 hours outside of our destination, my car decided to stop. In the middle of TX. Those who've had the honor of driving across western Texas can appreciate this dilemma. There is nothing in west TX. Nothing. As luck would have it, AAA found a dealer that we could tow the car to. We safely arrive at the dealer, with little hope that they (who are very nice but have 1 guy working in service for a dealer that sells 15 brands of cars) will even get to look at the car to find out if they can fix (and if I want to fix it depending on the cost).
A short version of a (very) long story, we jump in my wife's car and continue our trip (after rearranging logistics of picking up people from DFW airport since I'm nowhere near DFW airport). I spend the next day texting the service and sales teams (while I'm in the middle of my daughter's graduation ceremony) trying to figure out what to do.
So what does all this have to do with your business? Business never goes as planned, ever. Good people leave. Product launch dates slip. The customer (or donor) you thought was guaranteed fell through. You carefully planned each element of major event but the keynote speaker got ill. Life happens.
Good leaders are flexible. Good leaders know things will always go wrong. How they deal with the sudden adversity makes all the difference in the world. How you handle the crises life tosses your way will directly affect how people perceive you, admire or dislike you, and determine if they want to follow you. Good leaders use adversity to find opportunities. Learning to effectively deal with adversity makes us better leaders, but more importantly makes us better people.
Back to my car…at then end of the day (OK, it was actually 4 days), I got a new car, I had my old car fixed and gave it to my daughter whose current car was highly unlikely to make it from TX to CO. We both got cars that were 10 years younger, I feel like she is safer, and she gets another 10 years before she has to buy a new car. Win/win!
As always, we love to hear from you! If you've got stories of overcoming adversity - please share them!
I've found that the Aussies tend to be better at it than Americans. Brits too. In both corporate America and in global non-profits there is a significant lack of it. What is it? Speaking openly, honestly and forthrightly to friends and colleagues. (And, I'd argue spouses, children, family members, and significant others.)
There are many ways to phrase it: Truth hurts. Brutally honest. Fair and open. What you need to hear, not what you want to hear. Being transparent... The reasons we don't do it vary as greatly as well: It makes us uncomfortable. It's easier to not tell the whole truth. It makes the receiver uncomfortable… All of them, just excuses. We like to hear what we're good at, but not so much what we're not good at. Regardless of the reason, the fact is that there is a significant lack of transparency and honesty in our communications.
A great friend of mine got me thinking about this recently. He sent me this link — an exceedingly interesting interview with Ray Dalio (the unbelievably successful founder of Bridgewater) — on this very topic. Ray has what you might call an obsession with honesty. And while I am conflicted with his approach (especially the emphasis on brutal honesty), there is something refreshing about the freedom that comes from being in a culture/environment where you are expected to deliver and receive brutally honest communications.
Think about how often we create issues for ourselves by not being entirely honest and transparent. It's uncomfortable to tell your mother that you don't want to come to Thanksgiving dinner because of the awkwardness of your crazy aunt who will be there — so you blame your "can't make it" on work, or the kids' schedule. How about the difficultly in telling your millennial manager they made a really bad decision, because you "know how sensitive they are," and are afraid they'd leave. How about the times when we don't want to say no, or "I disagree" because we want people to like us. You want to go out with your friends, but you feel guilty about not being home with your family, so you make up stories to pacify either side depending on your decision. I could go on and on.
This is particularly frustrating and destructive in the work environment. I'm sure everyone is familiar with the "meeting after the meeting". Why the meeting after the meeting? Because in the first meeting, people gave lip-service to the discussion. They were not honest about the issues, or their feelings, or worse, didn't say anything in the meeting, but ragged on everyone and every decision after the meeting. This behavior is unacceptable. It erodes trust, breaks down relationships, and destroys organizations from within. If you as a CEO or a leader are allowing this to happen, you need to stop it immediately. If you don't know if it's happening, you need to find out and eradicate it.
I'm not suggesting we all adopt Ray's approach, or even his philosophy. But I believe we could all use a "check up" and some help in exercising our "honesty muscles". Both in terms of how we use it on/with others, and maybe more importantly, how we use it to receive information and feedback from others. Lastly, you don't have to be brutal to be honest, nor does being honest = being unkind. Yes, somethings are better left un-said. But, mostly we just need to say things better.
As always, we love to hear your feedback and input!
Hard. Fun. Exhausting. Exhilarating. All-consuming. Freeing. And a whole lot more. As I prepare to host the CEO forum at the CLA Outcomes Conference next week (along with my good friend Russell Verhey), I've been reflecting on the unique challenges CEO's face. Having been a CEO at multiple companies, I'm especially sensitive to the "no where to go" syndrome many CEOs deal with. It's a reality often described as "I can't really talk to anyone about the struggles I am experiencing" (in life and at work). It can be a lonely place.
As a CEO, there is intense pressure to perform, to have all the answers, to always know what to do and how to do it, to ensure a safe, engaging working environment for all staff/team members. To be "superman/woman". After all, the buck stops with you (or should!)
Most CEO's are wired in a similar way. The things that motivate them as an individual frequently equate to success for the company. The core ingredient is often described as drive. That drive is both a blessing and a curse. Without the drive, the organization doesn't succeed (or sometimes never gets off the ground). CEOs are built for moving forward, obsessing about growth, taking the hill, tackling the next obstacle. But, I've found that to be the most effective, CEO's need to exercise and nurture their softer side as well.
Drive, untethered, can lead to a lot of collateral damage. Usually in the form of people. It might be trite, but your people are your most important asset. Without them, you can't find and service customers, can't make and deliver product, can't count the money, and you certainly can't grow. Taking time to grow your people is as important (probably more) as growing your company. Just like customers don't buy things from companies - they buy things from people - CEO's need to be human to effectively teach, grow and learn from the people they serve.
Yes, I said learn and serve. Leadership is a privilege, not a right. People under you know when you understand the difference (and certainly know when you practice it). Great leadership does not come from power. People know you have power and they follow power when they are required to. They follow good, servant-driven leaders because they want to.
So, while it's stressful, energizing, exhausting and exhilarating to be a CEO, it's also amazingly cool to be able to lead, influence and grow the people you serve. It's not easy, but easy isn't really what you signed up for when you became a CEO! Happiness in life and work doesn't come from easy, it comes from laying your head on your pillow believing you did the right thing - for your people and your company. Be a happy CEO.
(And remember, if you need an outside perspective or voice, we're happy to help!) As usual, we love to hear your thoughts and comments!
It's hard, especially when you're smart and know the answer. It seems simple, but we frequently miss the most important part of building relationships with our co-workers — listening. Effective listening seems to decrease as we get more mature in our careers, probably because we know (or at least we think we know) a lot more. Sometimes there is a switch, and we end up talking less and listening more. Sometimes.
Over the years, in working with a wide variety of executives, I've found that many people who, on the surface seem to passionately disagree, are actually not that far apart. The perceived distance is usually a result of not understanding the other person's perspective, or from not really listening to what they are wanting to do, or not taking the time to really understand the other person's perspective.
Listening takes practice…and patience. It helps to put yourself in the shoes of the other person, and try to understand things from their perspective. It also helps to try to "listen purely" — that is, without your agenda or your filter. If you can, try to just listen without simultaneously thinking about what your reply is going to be. Try to take what you hear at face value, without spoiling it by "grading it" based on how close it is (or not) to your perspective. If you are a man, try not to "fix" what was just said. Just listen. Like I said, listening is hard. (If you want to see a very funny video on this topic, click Here)
The discipline of good listening is a valuable tool in life, not just business. Want to make your marriage better? Become a better listener. Want to be a better parent, boss, or employee? Become a better listener.
Here is a short list of some simple ideas for becoming a better listener: (and please send me comments on ones you've used and have found to be effective!)
I know I'm going to get a lot of grief about this post. So be it.
About 50 years ago, a well meaning, smart individual created a baseline metric for non-profits. This metric, largely still used today, is a ratio (or percentage) of operating expenses to total expenditures. The magic number is 10-15%.
The theory is based on the thought that mission-driven organizations that rely on donations should spend the vast majority of those donations on programs that help those they are in business to help. So, if I'm a local food bank, I should spend "the vast majority" of my donation income feeding people. There is nothing wrong with the theory. The problem comes in when defining what goes into the "operating expenses" ratio.
The principle of the theory is spot on. The problem is, it severely inhibits the ability of these non-profits to grow, and therefore have more impact and do more of the good things they are passionately doing. Imagine going to a CEO of a $50M for-profit company and telling her or him — "you need to double your growth, but you can't spend more than $5-$7.5M on running your operation (rent, payroll, administration), hiring talented people, or marketing or selling your product." It'd be a short conversation. Or, tell that same CEO that they could only hire people that are "willing to take a very small salary" because they can't afford to hire the best. That'd be a shorter conversation.
Why then do we think it's a good idea to put those kind of limits on non-profits? I get the reality of wanting to closely mange spending, and make sure that money is flowing to the areas that need it most. I also get that this has been abused in the past. But, if non-profits are about helping people in the most difficult situations, why wouldn't we want them to do more of it? Why wouldn't we want them "investing" to grow their organization so they can reach and help more people?
In our work with non-profits, this is a constant battle. Non-profit boards make poor decisions, executives are relegated to making poor decisions because everyone is worried about the "metric". Donors and potential donors have been conditioned to look at that metric as the end-all-be-all, and often shy away from those that want to "invest" in sales/fundraising, marketing, and the best people so they can improve outcomes and grow. Ironically, this is also true of large, high net worth individuals who would never make those decisions in their own companies.
There are no easy answers to this dilema. Changing perceptions are hard, and changing behavior harder. An idea? Adjust the ratio to exclude "fundraising and marketing." While this doesn't entirely fix the problem and certainly doesn't allow non-profits to attract the best talent, it starts to reshape expectations and perceptions— which is a good thing. Let us know what you think about this topic!
When we work with clients on pricing, I always get the question, "Is pricing art or science?". The answer is, of course, yes. Over the years, we've developed some very sophisticated pricing models. Models that analyze break-even, optimize price based on quantity, and even calculate optimal price based on defined value. We've even built "value calculators" to enable the customer to customize the solutions to get the exact value they need. Yet, no matter how complex, there is always an "art" component to pricing.
Here are a few nuggets of wisdom that we've learned over the years. If you follow these, you will, over time, optimize your profit. Let us know if any of these particularly resonate with you, and please share some of your own!
Steve is a husband, father, and business exec. He loves anything outdoors, anything that is a hard challenge, and enjoys working with anyone who wants to continually improve. And golf. He loves golf. Steve is the founder and CEO of Executive Advisory Partners.