01 March 2019

The Portable Bubble

"If you are not being challenged in your thoughts, then you are not aware of what others who are different than you are thinking."   

--Mary Charleson


Larry Culp, the new CEO of General Electric (GE), had a successful run in the same position at Danaher Corp.  The market capitalization of Danaher grew to $50 billion from $9.7 billion during his 14 year term.   One of the management practices Mr. Culp employed at the global science and technology company was to spend time in the field.  Making himself available to workers as he toured various operations was his way of learning about matters first hand. 

GE laid off 30,000 employees in 2018 so there will be fewer associates for Mr. Culp to talk with as he makes his rounds.

At The Home Depot, members of the Board of Directors "regularly visit stores and engage in the operational review of stores throughout the year," according to the company's website.

Peter Magowan, who headed up Safeway, and later purchased the San Francisco Giants along with other investors in 1992, avoided the owners suite choosing instead to sit in the stands to experience the game with fans.  He did that while wearing a suit.    

Keep moving

In the 1980s "Management by Walking (or Wondering) Around," a term coined by Tom Peters, described the way in which Bill Hewlett and David Packard ran their computer company.  The idea of stopping by to talk face-to-face with employees, to get a sense of how things are going, and hear what they are thinking, has a lot value if done properly.  

That's certainly one way to keep from being enveloped by a corporate echo chamber where everyone thinks alike.  

Bubbles are portable, meaning it's possible to stay in one even while traveling.  Direct reports and executive staff often arrange schedules that make leaders visible, but unreachable.  When out and about it's important for top management to insist on engaging with those who run the business every day.  

Getting fresh air

Hal Gregerson, Executive Director of the MIT Leadership Center, has written extensively about executive bubbles.  "The greatest responsibility of a CEO is to recognize whether (the company) requires a major change in direction," Gregerson writes.  

How does one undertake that assessment without a free flow of ideas from different perspectives?  

Dr. Gregerson's interviews with CEOs highlight two disturbing themes: "People telling you what they think you want to hear; and people being fearful to tell you things they believe you don't want to hear."   

Nandan Nilekani, a co-founder of Infosys, says you have to guard against a "good news cocoon."  

What can a CEO do?

Are you insulated from information critical to your work?  To find out, ask yourself these questions:  

1.  How many barriers do people have to cross to talk directly with you?

2. How much of your typical workweek is spent outside your office or headquarters?

3. When was the last time you were dead wrong about something at work?

4. How quickly did you uncover your last mistake?  How fast did you change course?

5. How often do people ask you uncomfortable questions at work?

6. How often do you talk with people who make you feel uncomfortable?

7. How many questions do you ask versus statements do you make in typical conversations?

8. How often do you wait silently for others to answer your questions?

9. How many times this week have you said, "I don't know" in response to a question?


Source:  "Bursting the CEO Bubble"  


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01 February 2019

2030


"There's no such place as far away."

--Richard Bach


There are 
10 years, 11 months  (3,987 days ) between 1 February 2019 and 1 January 2030.  While that may seem like a great distance, it really isn't.  The year 2030 is closer than you think.  
    
Since we perceive time speeding up as we age, take a moment to consider the following:

Leadership

1. How old are you now?

2. How old will you be in 2030?

3. Who is likely to be leading the business in 2030?

4. What is the current average age of your management team?

5. What is likely to be the average age of your management team in 2030?

Associates

6. What is the average age of your workforce now?

7. What is likely to be the average age of your workforce in 2030?

8. What is the primary source of your employees today?

9. What is likely to be the primary source of employees in 2030?


Customers

10. What is the current average age of your best customers, members, or donors?

11. What is likely to be the average age of your best customers, members, or donors in 2030?

12. What are the sources of your best customers, members, or donors?

13. How long did it take to develop those relationships?

14. Where will your best customers, members, or donors likely come from in 2030?


Paying too much attention to technological innovation, and not enough to relationships, tends to obscure the importance of demographics.  Fortunately, consistencies in behavior are more traceable than differences.  At the deepest levels of the human spirit people are quite predictable.  

Which is why in some ways 2030 is already here.          



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01 January 2019

Creating a Corporate Strategy


"The essence of strategy is choosing what not to do."

--Professor Michael Porter

Here's something to think about as a new year gets underway:

Does your business have a corporate strategy, defined as the desired future and a way to make it happen?  Is it clearly communicated and understood? Do the assumptions on which the strategy is based fit current reality? 

And is there congruency between the corporate and business unit strategies? Units need their own strategy, as do staffs. However, corporate should go first.    

The goal is an alignment of corporate, unit, and staff without which results are substantially lessened.

Getting started with the process can be challenging but having the right people involved is critical to the outcome.  With no one way to create a strategy (looking ahead and reasoning back), there are options to consider:

Option A (Predictive Strategy)

Premise:

The world is going to look like this--frame the corporate strategy for that future. 2
  • A message, theme or direction (20%)  
  • Implementation (80%)

Option B (Non-predictive strategy)

Premise:

We don't know what the world is going to look like.  Therefore we need a strategy or set of strategies that can be successful almost irrespective of what the world looks like. 3
  • A message, theme or direction (20%)  
  • Implementation (80%)  

Center of the earth

More than a few corporate strategies are rushed into creation, often by-passing the "core."  

If we begin at the center or with the purpose (why?) then there's a better chance the blank spaces get filled in with what makes sense.    

So what's a core idea?

It's a simple articulation of the original purpose or innermost reason for being. It forms the basis of an organization's culture. 

A core idea is central to what you're about.  It's not a mission statement; it's what you want to accomplish; a positive goal that can be realized at any time.

Some illustrations:  

o   Taking Wall Street to Main Street--Merrill Lynch
o   Technology married with liberal arts--Apple
o   Developing leaders of character--West Point

The right way to communicate a core is to embody or personify it.

No organization should assume current employees or management teams know what's in the core.  That means conversations, development programs, and on-boarding should include references to an organization's history and unique sense of purpose.   

A neglected idea

Borrowing from game theory we consider an overlooked, but valuable concept--having a dominant strategy. 

"In general someone has a dominant strategy when they have one course of action that outperforms all others no matter what competitors do.  If someone has such a strategy, their decisions become very simple; they can choose the dominant strategy without worrying about a rival's moves.  

Therefore, it is the first thing one should seek." 4

We learn that dominance in the term "dominant strategy" is superiority over another of your potential strategies (make a list), not of your business over a competitor.   

Avoiding common errors

After nearly five decades of observation, experience, and study, we note the following recurring problems facing CEOs when it comes to corporate strategy:

-Not being clear.

-Giving up too soon.  

-Building a strategy that's easily reversible.  

-Utterances and actions that don't match.

-Failing to have the right people in the right places at the right times.

(See our blog post, The Struggle with Strategy).

The speed of light

A year goes by quickly.  

What will you pay attention to over the next 12 months to ensure the business, under your watch, is moving in the right direction?  If it is, how to maintain momentum.  If not, how to adapt in order to regain momentum.  

No matter the analytics, the rare corporate strategy that works for any length of time is ultimately a series of judgment calls.  When it comes to thinking strategically, quoting Thoreau, "It's not what you look at that matters, it's what you see.         


1 Benjamin B. Tregoe and John W. Zimmerman

2 Philippe Silberzahn
3 Ibid
4 Avinash K. Dixit and Barry J. Nalebuff


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01 December 2018

With Peace on Earth

I Heard the Bells on Christmas Day

by Henry Wadsworth Longfellow 


Image result for images of henry wadsworth longfellow
Henry Wadsworth Longfellow
(1807-1882)
I heard the bells on Christmas Day
Their old, familiar carols play,
And wild and sweet
The words repeat
Of peace on earth, good-will to men!

And thought how, as the day had come,
The belfries of all Christendom
Had rolled along
The unbroken song
Of peace on earth, good-will to men!

Till, ringing, singing on its way,
The world revolved from night to day
A voice, a chime,
A chant sublime

Then from each black, accursed mouth,
The cannon thundered in the South,
And with the sound
The carols drowned
Of peace on earth, good-will to men!

It was as if an earthquake rent
The hearth-stones of a continent,
And made forlorn
The households born
Of peace on earth, good-will to men!

And in despair I bowed my head;
"There is no peace on earth," I said;
"For hate is strong
And mocks the song
Of peace on earth, good-will to men!"

Then pealed the bells more loud and deep:
"God is not dead; nor doth he sleep!
The Wrong shall fail,
The Right prevail,
With peace on earth, good-will to men!"


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(C) Bredholt & Co.

01 November 2018

Delivering Exceptional Service

"From now on the essence of this hotel will be speed.  If a customer asks you for a three-minute egg, give it to them in two minutes.  If they ask you for a two-minute egg give it to them in one minute.  If they ask you for a one-minute egg, give them the chicken."

--Groucho Marx, "A Night in Casablanca"


Recently Uber Technologies, Inc. let it be known that within three years the company intends to expand its services to include a fleet of food-delivery drones called, UberEats.  

Instead of having your Domino's Deluxe Pizza brought to the house or apartment by a friendly delivery person, that box, wafting with the smell of your favorite toppings, would sail through the air landing at your doorstep, hot and ready to eat.

While UberEats already has a ground delivery service, the announced timeline calls for a drone service to be in place by 2021 according to the original Uber posting on its website. 

Several big tech companies, Amazon and Uber among them, are keeping a George Jetson-future in front of hungry investors, and media.  On the ground over $3.5 billion has been invested in food and grocery delivery services in 2018.  Instacart, Inc., Postmates, Inc., and DoorDash, who delivers Wendy's hamburgers and other menu items, are vying for ways to carve out positions in this emerging market.

In the meantime  

This past summer I made a business trip from Kalamazoo, Michigan to Minneapolis, by way of Detroit, that somewhat resembles an obstacle course.  During each segment I became increasingly dependent on others to help get me to my destination safely and on time by delivering exceptional service:

Amtrak Station in Kalamazoo.  

When my train was posted late, Tod, the Amtrak station manager, offered to find a ground transportation service at Dearborn Station, about 30 minutes from Detroit Metropolitan Airport.  There's nothing unusual about a late Amtrak train.  That happens more than it should.  

What was different on that Thursday in June was Tod's effort to make sure we didn't miss our flight in Detroit.

Amtrak Station in Dearborn.

Eddie, our polite and knowledgeable driver, navigated heavy congestion and construction between the train station and airport.  All for a reasonable fee.       

Delta in Terminal A.

As it turns out my dash to the gate was unnecessary.  Delta 23 was running a little behind and boarding had yet to begin.  Then Delta announced that the scanning system for reading boarding passes was down.  All 167 passengers on this oversold flight would have to be boarded manually through the backup system.  

Susan, the gate agent, called for boarding and began a tedious process of getting passengers onto the Boeing 737-900 plane.  I asked how she felt about being alone at Gate 70 in Terminal A with a broken system. Her response:  "You do what you have to do."  

Within a reasonable amount of time, everyone was boarded and Delta 23 nonstop to Minneapolis was safely on its way.  

Hertz at Kalamazoo/Battle Creek International Airport.

I returned to Kalamazoo by renting a Hertz car at Detroit Metro Airport and driving two hours west on Interstate 94 to the Portage Road exit. In my haste to fill out the rental agreement (gas, mileage, time) and get home, I left my mobile phone in the front seat.  

Fortunately, when associate manager, Michael, did the vehicle inspection, he found the phone and held it for me.   

With appreciation

I am grateful to Tod, Eddie, Susan, and Michael for their spirit and quality service.  Each acted as much out of who they are as what they may have been trained to do.  

What happens next?

Who knows what will unfold when it comes to delivering products and services through a variety of methods, including by air.  With technology and artificial intelligence advancing at rapid speeds the sky may indeed be the limit.  

It's important to find ways for your business to stand out among the competition.  One path to success is providing exceptional face-to-face customer service.  When necessary, give them the chicken.  

Delivering what's promised on a daily basis is not easy to do--but that's the goal.  

For now, your Domino's Ultimate Pepperoni Pizza will still be arriving by car, truck, or SUV--delivered by a mortal being.  When The Wall Street Journal contacted Uber about a flying drones program the company removed that posting from its website.  

Apparently, the air version of UberEats has been temporarily grounded.      



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(C) Bredholt & Co. 





01 October 2018

What a Game!

"You'll like baseball.  It's a civilized pastime."

--From the Broadway musical, "Ragtime" 


Fifty years ago this month the Detroit Tigers won the 1968 World Series 4 games to 3 over the exceptionally talented St. Louis Cardinals (Curt Flood, Mike Shannon, Orlando Cepeda).  Detroit (Al Kaline, Denny McLain, Jim Northrup) was down 3 games to 1 and Tigers fans, including me, thought there was little chance the Motor City team could win a seemingly insurmountable three straight.  Especially with Game 7 being played under the Arch in St. Louis against future Hall of Fame pitcher, Bob Gibson.  

Detroit pitcher Mickey Lolich won three complete-game victories and was named World Series MVP.  The improbable comeback was due in large part to Lolich's left arm--and Willie Horton's perfect throw in Game 5 to catcher Bill Freehan who tagged out Lou Brock as Brock decided to stand up and not slide into home plate. 

A baseball era ended Thursday, October 10th at 3:07 p.m., Central Time, with the final out at Busch Memorial Stadium. The Tigers winning 4-1 before a sellout crowd of 54,692.

There are several historical observations about the '68 World Series in which the Tigers were managed by Mayo Smith and the Cardinals by another future Hall of Famer, Red Schoendienst.  Most notably is that was the last World Series where American and National League champions would enter a Fall Classic without going through a playoff process.  In succeeding years TV money, seven figure contracts, best of five and best of seven series, plus team expansions, would launch baseball into a totally different era.  

That was then       

If the business model of professional baseball was about to change in significant ways so was the nature and development of its future talent.  

Five decades later what is the status of baseball pipelines such as Little League, high schools, college, farm systems, and minor leagues?  

"They can't play catch," says Jack Thompson, a 40-year high school baseball coach from California who spoke with The New York Times.  While Thompson says young players can scorch line drives, hit 400-foot homers, and hurl blazing fastballs, these future major leaguers have to be taught how to play catch.  

The story makes clear that the new "holy grail" is a college athletic scholarship.  However, in pursuit of that goal "the fundamentals are falling by the wayside in favor of flashier skills like big-league-style hitting and pitching," according to sportswriter, Bill Pennington.  

The report adds that private coaching, specialized camps, and travel teams, all have the same objective--to place youth players in college recruiting showcases.  

As a result of these new values, Pennington concludes, "a generation of top ballplayers has, in most cases, spent little time learning how to accurately throw across the diamond; catch a fly ball; field a ground ball and turn a double play; run the bases effectively; make a tag at a base, or, God forbid, bunt."

Where are the parents?

I shared a Southwest flight from Kansas City to Chicago with a sports consultant who specializes in identifying young talent for major colleges and professional sports.  What I learned is that the driving force for these kinds of changes in player development and recruiting is often the parent.  

My seatmate said that even the advent of newly designed uniforms by traditional football programs (Notre Dame; University of Miami; Iowa State; Arizona State; Army and Navy; Texas A & M) is an enticement to high school athletes and their families to come and be part of something new.  

Well-rounded players

Let's take this idea of specialization and move it into the marketplace.

What are employers looking for? 

They want employees who are talented but can also work as a team.  Who know how to play catch, and maybe hit an occasional home run.  They're after personalities that are more fully developed in all aspects of life.  Those who are composed and balanced in their dealings with colleagues and customers.  

There's no going back in time and the past was never as good as we remember it to be.  Nonetheless, hard work, proficiency, and maturity are traits as desirable in people today as they were fifty years ago.  For inspiration, look at the Detroit Tigers and St. Louis Cardinals whose 1968 rosters were filled with players of that kind.  



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01 September 2018

On Becoming a CEO

"Nobody knows how to be a CEO. It's something you have to learn.  It's a very lonely job."

--Ben Horowitz


In his valedictory "Corner Office" column, Adam Bryant summarizes a decade of interviews with 525 Chief Executive Officers (CEOs).  "What a rare vantage point a CEO has for spotting patterns about management, leadership and human behavior," he notes.

What else can we learn from a rich trove of CEO wisdom?

Themes

After sorting through the insights, Bryant begins by offering three themes from the "Corner Office" interviews:

1. Applied curiosity.  CEOs tend to question everything.  They want to know how things work, and wonder how they can be made to work better.  They're curious about people and their back story.

They wonder less about the right career path and make the most of whatever path they're on.  Lessons learned from their experiences are crucial to their development.

2. Challenges are motivating.  The last thing this category of leadership wants is to be comfortable.  

3. Management discipline.  On the way to the top the focus is on doing the current job well.  If the concern is more about the job you want than the job you have, that's a problem.  And those nearby can sense when you're emotionally absent from the current position.  There's nothing wrong with thinking and planning ahead.  But the focus should be on building a track record of success.  When you do, people notice.

It's not simple

Leadership is a series of paradoxes.  For example, needing humility and confidence at the same time.

The highest attribute

Trustworthiness.

Making the right hiring decisions

If you could ask somebody only one question, and you had to decide on the spot whether to hire them based on their answer, what would it be?

"What are the qualities you like least and most in your parents?"  (Bob Brennan, CA Technologies)

A CEO story

As told by Bill Green, chief executive of Accenture ...

"I was recruiting at Babson College.  This was in 1991.  The last recruit of the day--I get this resume'. I get the blue sheet attached to it, which is the form I'm supposed to fill out with all this stuff and his resume' attached to the top. The resume' is very light--no clubs, no sports, no nothing. Babson 3.2 (GPA).  Studied finance. Work experience: Sam's Diner, references on request.  

"It's the last one of the day, and I've seen all these people come through strutting their stuff and they've got their portfolios and semester study abroad. Here comes this guy. He sits.  His name is Sam, and I say:  'Sam, let me just ask you, what else were you doing while you were here?'  

"He says, Well, Sam's Diner.  That's our family business, and I leave on Friday after classes, and I go to work till closing.  I work all day Saturday till closing, and then I work Sunday until I close, and then I drive back to Babson.'  I wrote, 'Hire him,' on the blue sheet. He had character. He faced a set of challenges. He figured out how to do both."

What else should we know?

"It's work ethic, Green said."  "You could see the guy had charted a path for himself to make it work with the situation he had.  He didn't ask for any help.  He wasn't victimized by the thing. He just said, 'That's my dad's business, and I work there.'  Confident.  Proud."

A desirable trait

What's to admire about successful CEOs?  The columnist Bryant concludes: "They own their job, whatever it is."


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