01 April 2017

The Struggle with Strategy

"No worthwhile strategy can be planned without taking into account the organization's ability to execute it."

--From Execution by Larry Bossidy and Ram Charan


It's fairly common that when things go bad in corporate life there's a tendency to blame the marketplace, disruptive actions by competitors, timing, and even government regulations. Each of these factors can and do weigh against the best strategic plans.  Those plans are attempts to identify, hopefully in plain language, a desired future for the organization, and how to make it happen (strategy defined).  


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However, there may be something more important than rounding up the usual suspects.  

"The single greatest reason companies get into trouble is because CEOs are bad at strategy," says Cesare R. Mainardi, adjunct professor of strategy at the Kellogg School of Management and a former CEO of Booz & Company.   

Writing in The Wall Street Journal Professor Mainardi quotes two statistics from a global study about leadership capabilities:  

"81% of the time when major shareholder value is destroyed it's because of bad strategy decisions (Ron Johnson former CEO at J. C. Penney).  And only 8% of all executives are good at both strategy and execution--that is, betting on the right strategy and doing the right things to make it happen (Jeff Bezos current CEO at Amazon)."

Day-to-day matters

"If things go sideways it is most likely the strategy and execution decisions made day-in and day-out," Mainardi concludes.

The apparent self-deception facing an enterprise is that it often appears to be doing all the right things--with a focus on growth; pursuing excellence; reorganizing for change; and creating a lean structure.  Yet much of the time that list proves to be nothing more than imitative rhetoric.

"Conventional wisdom is actually a trap ... it creates a huge gap between a chosen strategy and the ability to deliver it," the study notes.  

In their best-selling book referenced above, Bossidy and Charan make the point that "execution requires a comprehensive understanding of a business, its people, and its environment."   It means top management is to be clear--but not too clear--about strategy, focusing on the objective while not defining the method of execution day-to-day.       

Roger Fisher, former director of the Harvard Negotiation Project, put it this way:  "Distant visions and hard work are both required, but unless what you do today is related to where you want to end up, you will never get there."     

The idea of mutual accountability for results may be too uncomfortable for some. If so, it explains, in part, why the "strategy-execution gap" is not broached more often in corporate and business unit discussions.   

Closing the gap

What are some ways to help close the strategy-execution gap?  

Professor Mainardi offers the following:

1.   Commit to an identity.  Stop endlessly chasing growth.  Invite it.  Define one's self by what one does--not just what one sells.  A truly differentiating identity is built on bespoke, difficult-to-build capabilities.    If a leader chooses to be true to his or her company's chosen identity day in and out, he or she can build an extraordinary company.

2.   Translate the strategic into the everyday.  Stop the endless benchmarking.  Focus on building the handful of unique, cross-functional capabilities that actually deliver on strategy. Leaders must roll up their sleeves and be close enough to the execution to become the architect and chief builder of the capabilities needed.

3.   Put culture to work.  Stop fighting a company's culture and blaming it for undermining strategy.  Start putting it to work instead.  No culture is perfect.  The key is to identify and leverage the parts that work in a company's favor.

4.   Cut costs to grow stronger.  Stop making the classic mistake of going lean everywhere. Most companies waste 20% to 40% of their budget on expense items that have nothing to do with their strategy.

5.   Shape the future.  Stop constantly reacting to market changes.  Agility is overrated.  It has unfortunately become code for throwing out strategy and chasing any opportunity one thinks might work.  The best way to own the future is to be the one to shape it.



In the May Strategist Blog:  A look at why CEOs change corporate strategies.


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01 March 2017

A Homecoming

While standing in line to board a Southwest Airlines flight at Orlando International Airport recently, I heard the sound of applause behind me in Terminal A concourse near our gate, 128.  

Turning around I observed about two dozen U.S. soldiers quickly disembarking their Southwest plane at gate 126.  Passengers waiting to board the outbound flight at that location were giving them a rousing ovation. 

Passengers for our flight, now looking in that direction, began applauding as well.  The display of appreciation was catching as other passengers in gate areas on both sides of the concourse were doing the same--expressing thanks to these American troops coming home.  

There was no way to tell where the service men and women were deployed but that didn't matter.   A few that were tearfully met by family members seem to indicate that wherever it was the time away was likely an extended separation.  

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As the soldiers moved down the concourse other passengers, perfect strangers waiting for their flights, noticed the troops and they, too, responded with enthusiastic applause.  

What began as a spontaneous show of appreciation at one gate continued as a wave of recognition until the soldiers turned the corner, near the trams, which would take them terminal side to loved ones anxiously awaiting their safe return.

In a world of staged and superficial events, this was an impromptu and uplifting moment.  

Welcome home.


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01 February 2017

If--

By Rudyard Kipling
Rudyard Kipling, 1865-1936


If you can keep your head when all about you
   are losing theirs and blaming it on you,
If you can trust yourself when all men doubt you,
   But make allowance for their doubting too;
If you can wait and not be tired of waiting,
   Or being lied about don't deal in lies,
Or being hated, don't give way to hating,
   And yet don't look too good, nor talk too wise:

If you can dream--and not make dreams your master;
   If you can think--and not make thoughts your aim;
If you can meet with Triumph and Disaster
   And treat those two impostors just the same;
If you can bear to hear the truth you've spoken
   Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to, broken,
   And stoop and build'em up with worn-out tools:

If you can make one heap of all your winnings
   And risk it on the turn of pitch and toss,
And lose, and start again at your beginnings
   And never breathe a word about your loss;
If you can force your heart and nerve and sinew
   To serve your turn long after they are gone,
And hold on when there is nothing in you
   Except the Will which says to them: 'Hold on!'

If you can talk with crowds and keep your virtue,
   Or walk with Kings--nor lose the common touch,
If neither foes nor loving friends can hurt you,
   If all men count with you, but none too much;
If you can fill the unforgiving minute
   With sixty seconds' worth of distance run,
Yours is the Earth and everything that's in it,
   And--which is more--you'll be a Man, my son!



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01 January 2017

Managing Agreement

Here is a management theory explained as an allegory.  See if you recognize the decision-making process which made the "Abilene Paradox" possible.
______________

In an Abilene paradox a group of people collectively decide on a course of action that is counter to the preferences of many (or all) of the individuals in the group. It involves a common breakdown of group communication in which each member mistakenly believes that their own preferences are counter to the group's and, therefore, does not raise objections. 

A common phrase relating to the Abilene Paradox is a desire not to "rock the boat." This differs from groupthink in that the Abilene paradox is characterized by an inability to manage agreement.

Going out for dinner

The term was introduced by management expert Jerry B. Harvey in his 1974 article The Abilene Paradox: The Management of Agreement. The name of the phenomenon comes from an anecdote in the article which Harvey uses to elucidate the paradox:

On a hot afternoon visiting in Coleman, Texas, the family is comfortably playing dominoes on a porch, until the father-in-law suggests that they take a trip to Abilene [53 miles north] for dinner. 


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The wife says, "Sounds like a great idea." The husband, despite having reservations because the drive is long and hot, thinks that his preferences must be out-of-step with the group and says, "Sounds good to me. I just hope your mother wants to go." The mother-in-law then says, "Of course I want to go. I haven't been to Abilene in a long time."

The drive is hot, dusty, and long. When they arrive at the cafeteria, the food is as bad as the drive. They arrive back home four hours later, exhausted.

One of them dishonestly says, "It was a great trip, wasn't it?" The mother-in-law says that, actually, she would rather have stayed home, but went along since the other three were so enthusiastic. 

The husband says, "I wasn't delighted to be doing what we were doing. I only went to satisfy the rest of you." The wife says, "I just went along to keep you happy. I would have had to be crazy to want to go out in the heat like that." The father-in-law then says that he only suggested it because he thought the others might be bored.

The group sits back, perplexed that they together decided to take a trip which none of them wanted. They each would have preferred to sit comfortably, but did not admit to it when they still had time to enjoy the afternoon.

Summary

Ronald Sims writes that the Abilene paradox is similar to groupthink, but differs in significant ways, including that in groupthink individuals are not acting contrary to their conscious wishes and generally feel good about the decisions the group has reached.

According to Sims, in the Abilene paradox, the individuals acting contrary to their own wishes are more likely to have negative feelings about the outcome.  In Sims' view, groupthink is a psychological phenomenon affecting clarity of thought, where in the Abilene paradox thought is unaffected.

Like groupthink theories, the Abilene paradox theory is used to illustrate that groups not only have problems managing disagreements, but that agreements may also be a problem in a poorly functioning group.

Questions
  1. Has your management team ever taken a trip to Abilene? 
  2. Why is consensus a potentially risky proposition?  
  3. What's solidly held in common where you work?  
  4. How can you build on that strength?

Source:  Jerry B. Harvey, Wikipedia ®, Ronald R. Sims



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01 December 2016

Wisdom for the Ages

"Any fool can know.  The point is to understand."

--Albert Einstein

Leadership is not for everyone even though development programs and offerings from higher education might lead us to believe the reverse is true.  In fact, many don't want to be leaders, or qualify, even as they are nudged in that direction and away from the much needed tasks of management.   

Why is this so?

One reason is that leadership, done right, is hard work.  There may be perks and occasional glamour which come with titles, but for the most part, heavy loads, especially for prolonged periods, exact a steep price--physically, mentally, and emotionally.

Another is that people tend to function in business without having developed a philosophy of life which centers on how to live.  About knowledge, truth and the meaning of life.

Answering these and other questions would seem to be a prerequisite for someone seeking a position of responsibility.  Few there are who take time to seriously consider this particular building block of character, are aware of its importance, or know how it becomes a reality in their lives.  There aren't many corporate universities offering a "philosophy" course in their curriculum. 

That's unfortunate.  

Associating with someone clear on their purpose and that of the enterprise makes for healthy relationships and a creative work environment.

What can we learn about philosophy, with a contemporary application, from those whose wisdom transcends the ages?

In their book, The Ten Golden Rules of Leadership, M. A. Soupios and Panos Mourdoukoutas, combine philosophical discernment with the pursuit of leadership in modern times:

Rule l:  "Know thyself."  (Thales)  Understand your inner world, your bright and dark sides, your personal strengths and weaknesses.  Self-comprehension is a fundamental precondition necessary for real leadership.

Rule 2:  "Office shows the person."  (Pittacus)  The assumption of authority brings out the leader's inner world.  It reveals whether the leader has undergone a process of honest self-discovery that allows for the productive application of power. 

Rule 3:  "Nurture community in the workplace."  (Plato)  Community development and positive group sentiment are virtues leaders must nurture by providing the right support, guidance, and incentives.

Rule 4:  "Do not waste energy on things you cannot change."  (Aristophanes)  Do not waste resources and energies on things you cannot control and things you cannot change.

Rule 5: "Always embrace the truth."  (Antisthenes)  Effective leaders should always embrace the truth, always encourage candid criticism throughout the organization, be skeptical of flattering appraisals, and never let authority place a wedge between them and the truth.

Rule 6: "Let competition reveal talent." (Hesiod) While knowledgeable employees can be hired in the marketplace or recruited from within, bringing their talent out and aligning it with organizational interests requires an environment that allows employees to compete with each other in a constructive rather than a destructive way.

Rule 7: "Live life by a higher code."  (Aristotle)  Dedicate yourself to a higher standard of personal conduct; don't hold grudges and ill will toward those who offend; be ready to assist those who are in need without asking something in return; remain calm in the face of crisis; dedicate yourself to principle without compromise; earn the trust, respect and admiration, of your subordinates through your character, not through the authority conferred upon you by the corporate charter; turn authority into power.

Rule 8: "Always evaluate information with a critical eye."  (The Skeptics)  Don't rely upon old premises, assertions, and theories.  Develop a critical mindset that accepts nothing at face value, certify the credibility and usefulness of critical information, analyze the context that produces critical information and the messengers that convey it, and never rush to judgments.

Rule 9: "Never underestimate the power of personal integrity."  (Sophocles)  Always set an honorable agenda; adhere to a code of professional conduct, never try to justify dishonesty and deceit; rather fail with honor than win by cheating.

Rule 10:  "Character is destiny."  (Heraclitus)  True leadership begins within, not without.

(Buy the book.)

Do we understand?

Do you have a philosophy of life, and leadership, which explains your purpose or sense of calling?  If so, what is it?  Do those around you know your philosophy?  Is it lived out for all to see?  Does it match the values and culture of your organization? 

Psychologist Lawrence Pervin, who wrote an authoritative textbook on personality psychology, framed the matter this way: "Is there a disposition to express behavior in consistent patterns of functions across a wide range of situations?"

Where do you need to improve? 

Basic beliefs--and behavior--matter, as wisdom in exercising the mantle of leadership derives from the qualities of our moral character. 


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01 November 2016

A Season of Thanksgiving

“Cultivate the habit of being grateful for every good thing that comes to you, and to give thanks continuously. And because all things have contributed to your advancement, you should include all things in your gratitude.”  

--Ralph Waldo Emerson

If as someone has written "gratitude" is a state of being grateful while "thanksgiving" is an expression of that gratitude, then as we begin the holiday season I want to acknowledge the following:

Our teachers and professors

Those individuals who invested extra time in me, nurtured our intellectual development, curiosity, and creativity.   One stands out: Marian Bolhouse, my 1st grade teacher in Benton Harbor, Michigan, is an inspiration for much of our learning to this very day.   It was the first and last time I got all A's, or back then, +'s.   Too bad I didn't have a Miss Bolhouse every year.

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Calvin Britain School, Benton Harbor, Michigan (1954-1960)

College professors Gunnell Jordan, Joseph Nielson, Linford Marquart and Robert Starcher at Olivet Nazarene College combined character, academic achievement and critical thinking in the liberal arts tradition. 

Dr. Edgar H. Schein, Sloan Fellows Professor of Management Emeritus, MIT, for being a trusted shadow advisor.

Professors Gautam Kaul (finance), Scott DeRue and Maxim Sytch (leadership) from the University of Michigan are taking us to new levels of learning--online.

Our references

Our first real job in business was at General Motors.  That would not have been possible without a neighbor and friend of the family, Howard Johnson.  No, not that Howard Johnson.  This Howard was a general foreman at what is now known as Flint Metal, on Bristol Road in the city of the same name.

Most summer clerks who worked in plant offices were General Motors Institute students (Kettering University).   Or family members of management.  Neither applied to me.  But I could type.  Howard told my father he would do his best to get me an interview, and I was on my own from there.  He did follow up, and I got a job.  That's a lesson in the value of long-standing relationships and the strength of third-party referrals.  

Others would come along like Wendell and Jean Frerichs, Kankakee, Illinois, who also opened doors of opportunity.

All have motivated us to do the same whenever possible.

Our clients

Where would we be without our clients the past 37 years?   They are better to us than we deserve.  It's hard to state in words what it means to be allowed inside a business or nonprofit to work in some capacity.  The issue is trust--that they trust you with their thoughts, ideas, and plans for the future. 

It's a chance to contribute with the hope they get something from your advice which equals what you receive from their experiences.  Asking the right questions, exploring possibilities, and sharing what is learned from a wider community are a few ways in which an outsider can be of assistance.

A consultant sometimes proposes but a client always disposes.

I am grateful for engagements that have come our way as well as those that went in a different direction. There's a reason for what you have, and don't have. Understanding that truth comes only in retrospect.

Our readers

This is the 78th post since Strategist Blog was launched in 2009.  Thank you for making time to read and provide feedback.    

Our family

Nothing like having quality parents to set an example for your life.  My father, Russell Sr., was a pastor and theologian.  And our mother, Lydia, worked diligently inside and outside the home.  Both lived by faith--with compassionate hearts. 

Then there is the love and encouragement of my wife, Chris.  And a wonderful family.

Our support

From friends and neighbors. Doctors and lawyers.  Mentors and mechanics.  Even the kindness of strangers.  All make life and work possible.

Who has been helpful to you?  Do they know?

While not always easy to do, life's circumstances have taught us "to give thanks continuously," as a season without end.


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01 October 2016

The Narcissistic Leader

"The greatest need of our time is to clean out the enormous mass of mental and emotional rubbish that clutters our minds." 

--Thomas Merton

Between the upcoming U.S. presidential election, and the social-psychological make-up of 83 million Millennials, representing more than one-quarter of the nation's population, are we witnessing an increased level of self-centered behavior?

Does this mean "narcissism" is on the rise among the general population?

According to an article in the October 2016 issue of "Psychology Today," the growing consensus among psychologists is--no.  It's estimated that narcissistic behavior, a term originating in Greek mythology when Narcissus fell in love with his image in a pool of water (see below), is found among only 1% of the population with the percentage remaining about the same since tracking studies began.


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Narcissus viewing his own image.

So what exactly is narcissism?

Craig Malkin, a lecturer at Harvard Medical School and author of "Rethinking Narcissism," says, "it's the capacity to see ourselves through rose-colored glasses."   And Dr. Malkin makes clear that it's a trait each of us exhibits to a greater or lesser degree.    

That narcissism can be helpful is proven in studies.  For example, a healthy dose can fuel confidence which allows us to take risks, like seeking a promotion. 

It's feeling too special that causes problems.

Researcher, Sandy Hotchkiss, identified seven deadly sins of narcissism:

1. Shamelessness

2. Magical thinking

3. Arrogance

4. Envy

5. Entitlement

6. Exploitation

7. Bad boundaries

Personality traits

Writing in "The New York Times," Daniel Goleman, describes good managers as easy to spot.  He quotes Robert Hogan from the Tulsa Institute of Behavioral Sciences, who says, "Besides intelligence and a knack for strategic planning, they have enormous charm and energy."  That is, "they have charisma."

Dr. Hogan goes on to say that charisma has its dark side.  "Some top executives who look good to their peers and their bosses and who do well on most assessments, turn out to be terrible for their companies," he said.   "These are flawed managers, whose glittering image masks a dark destructive side, Dr. Hogan added.  "They end up being costly by creating poor morale, excessive turnover, and reducing productivity.  Sometimes they can ruin a company altogether." 

As author, Ira Chelaff, once observed:  "Arrogant leadership is toxic to an organization.   It looks like strength but is a debilitating weakness."    

How dark? 

Charisma can bring out the worst in subordinates:

Groupthink.  Workers feel they must censor what they say in meetings.

Distortions of the truth.  Twisting facts to please the boss.

Tension.  Employees don't feel like themselves in the boss's company.

Humorlessness.  The tone is grim, there's no joking around with the boss.

Blind loyalty.   Excessive demands made to show loyalty.

Source:  Wharton Center for Applied Research

Any hope?

Rebecca Webber, the author of the PT article, says, yes.

"If a fragile self is the true underpinning of narcissism," Webber writes, "one way to strengthen it is with self-compassion which leads to more stable feelings of self-worth, as opposed to self-esteem."  Webber is coming close to the idea of "grace"--from ourselves, and others.  Giving and receiving when needed.

Dr. Malkin, the specialist from Harvard, offers this insight, "By increasing security, narcissism drops." 

"Perhaps the difference between good and bad leaders comes down to a distinction between healthy and unhealthy narcissism," Daniel Goleman concludes. 

To achieve healthy leadership, should we add "humility" to strength of character?  Then maybe our reflection in the pool of water might begin dissolving, over time, into something less arrogant, more sincere and self-aware. 

That kind of arduous change, in behavior and spirit, would go a long way in clearing out "the rubbish of our minds."


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