The IT project took twice as long as planned. The construction project to expand the plant went over budget.
Why does this always happen?
Too many decisions are made with too much self-confidence and too much optimism. As a result, poor decisions are made and objectives are not realized. The decision-making flaw in all these situations is that we do not consider the ‘base rate.’
The base rate represents the statistical average of what happened previously – what were the actual results for people who made similar decisions in the past.
“Predictions are difficult – especially about the future.”
This quote from Yogi Berra sums up the challenges we all face in today’s dynamic and fast-changing world.
None of us has a crystal ball that allows us to predict the future and the rapid changes in our business environment that the future will bring.
The best response to an uncertain future is to build a culture of flexibility and rapid adaptability in our organizations.
When continuous improvement is a fundamental part of our company culture, our business gets better every day and will soon out-run and out-perform the competition. Over 100 years ago, Henry Ford wrote:
The competitor to be feared is the one who never bothers about you at all, but goes on making his own business better all the time.
Creating a culture of continuous improvement is difficult. This is especially true for currently profitable and high performing organizations who are content and follow the old adage of “it ain’t broke, don’t fix it.”
Ten fundamentals to consider when trying to become a continuous improvement organization. Continue reading
As I write this blog, we are in the midst of the Covid-19 Pandemic. Each day brings changes to how and where we can conduct business; we have little visibility into what the next month, three months, or six months will bring; and many of our employees are fearful.
To help those leaders during this and other crises, I offer some suggestions to how we can lead our businesses in uncertain times.
First of all, we need to keep calm and project an image of calm and confidence. Our employees look to us for guidance. The calm and confidence comes from the certainty that we will survive this. We do not know what will happen tomorrow and we do not know when this uncertainty will end. But, we do know that (with the collective efforts of our great team), we will do everything to make it through.
The consultant, Stan Sipes, once commented:
“The most common weakness I see in organizations is the lack of work that is done in a meeting.”
Today, more than ever, so little work is done in meetings because no one has done their homework to actually prepare for the meetings.
As a result, a meeting with the objective to discuss and make a decision morphs into a meeting that is 95% informational (getting everyone up to speed) and 5% decision-making (which usually becomes just a rubber stamp because we have run out of time and attention).
“There are smart decisions and wise decisions. And one form of wisdom is the ability to judge when to let luck disrupt our plans. Not all time in life is equal. The question is, when the unequal moment comes, do we recognize it, or just let it slip? Jim Collins (Great by Choice)
Being opportunistic means that we take advantage of those opportunities that unexpectedly cross our paths. To best position ourselves to capitalize opportunities, we need to:
Successful leaders make good decisions… consistently.
Good decision-making is dependent on a number of factors: understanding, experience, intelligence, foresight, and just plain luck. There is no guide that will tell you how to make the perfect decision. But, there are some keys to better decision-making that, when followed, will help to improve the quality and consistency of your decisions.
“It’s not always what we say; often it’s what we allow the other person to say. By listening, we gain trust and make other people feel more comfortable with us.” Rick Pitino
The ability to listen well, to really listen well, is one of those “soft skills” that distinguish effective leaders from run-of-the-mill managers.
As leaders, effective communication requires that we listen well to understand the true views and opinions of our team, our customers, and other stakeholders.
Four keys to such effective communication include:
Strategic thinking skills differentiate middle-level managers from effective upper level leaders. With excellent strategic thinking skills, the leader is able to make effective decisions that benefit their companies in both the short and long term.
Developing strategic thinking skills requires practice. It requires us to think strategically and see the consequences of our thinking. Three ways to get this practice and develop great strategic thinking skills include:
Hawaiians and other Polynesians are the descendants of peoples who traveled by boat from East Asia to settle their islands. Those most likely to survive the long and arduous journey were those with “thrifty genes”. They were those ancestors who were best able to process and use the limited food on their boat trips. Today, in a world of cheap and plentiful food, these same “thrifty genes” have led to an epidemic of obesity and diabetes among their descendants. What worked in one time may not work in another.
I share this anecdote to drive home the point that “survival of the fittest” does not mean survival of the toughest or meanest in a dog eat dog world. Rather, the survival and success of the fittest requires that we be flexible and adaptive in our leadership focus, style, and vision depending on the needs of the marketplace and our companies. Continue reading
Even as leaders, we all have bosses. Perhaps, it is a Vice-President. Perhaps, it is the CEO. Perhaps, it is the Board of Directors.
To move our companies forward, we need to be good (but not mindless) followers to our good bosses.
Support the Boss
The success of any organization requires that everyone is rowing in the same direction. So, our job as followers is to ensure that we devote ourselves to following and supporting the direction in which our boss is taking us. This means supporting their key initiatives and doing what is required to further the goals and objectives of our boss.
In corporate America, approximately $100 billion is spent each year on training. Yet, many studies show that training is only 10% – 15% effective. As Harvard Business School Professor Michael Beer writes, this is…
the great training robbery
Yet, training is a vital part of developing a winning team. So, how can we do training right?
Keep It Simple… Keep It Small… Keep It Focused
Training is only useful when it can be put into action and change our thoughts and behaviors. The best way to do this is to change one habit at a time. As such, our training goals need to be modest and focused on one (or at absolutely most, three) specific concepts at a time. In addition, the trainer needs to be explicit about how the training relates to the trainee’s job and how the training can be put into action.
To run our businesses more effectively, most documents and reports in our businesses (including summaries, plans, reviews, and analysis) should be kept to one page.
Businesses are awash in information, specifically reports, analysis, weekly updates or reviews, which are rarely read and, even more seldom, acted upon. As an example, the one page Executive Summary is a relic of the past, now replaced by Executive Summaries of 3 – 5 pages or even longer. Such long reports or analyses are time-consuming to write and usually too complex to translate into actionable steps to move our companies forward
“Abraham Lincoln said that people think that the real test of a person’s character is how they deal with adversity. A much better measure of a person’s character is to give them power. I’ve been more often disappointed with how people’s character is revealed when they’ve been given power.” Harvard Business School Dean Nitin Nohria
As leaders, we have power. We have the power to direct and lead others; we have the greater power in all of our interpersonal relations. This power requires us to be even more attentive in our interpersonal relations to ensure that we do not abuse this power, but instead that we are as effective as possible in developing open, positive, two-way communication with our teams.
So, what can we do to develop strong interpersonal relations with the people who work for us?
“The world is changing faster than ever before.”
“We need to adapt to the change or we will get run over by it.”
“The paradigm has shifted and the world will never be the same.”
“Robotics and AI (Artificial Intelligence) will disrupt every industry and company on the planet.”
The hype from the media about the change happening in the world is nearly overwhelming. As such, many of us live in fear that we and our businesses are not changing fast enough.
To move our companies forward, we need to experiment. We need to try out new products, new sales/ marketing strategies, new processes, and new leadership styles. We cannot be certain if all of these will work. But, to not experiment means that our companies stagnate.
It is common sense to take a method and try it: if it fails, admit it frankly and try another. But, above all, try something. Franklin Delano Roosevelt
“In a minute, there is time for decisions and revisions which a minute will reverse.”
This line from the 1915 T.S. Elliot poem, The Love Song of J. Alfred Prufrock, is a lovely bit of poetry. It is also a prescription for how not to run a business.
To be successful leaders running successful businesses, we need to be decisive. We need to make a decision, decide on a course of action, and then work relentlessly to execute on the decision.
“The one word that makes a good manager — decisiveness.” Lee Iacocca
Guilty as charged!! I confess that I do, at times, micromanage.
However, soon after slipping into micromanagement, I become aware (yet again) that micromanagement is truly just mis-management. It would have been far better for me to avoid the trap of micromanagement and to focus instead on coaching and empowering my team to achieve great results.
Several years ago, a medical surgeon, Atul Gawande, wrote a best-selling book, The Checklist Manifesto: How to Get Things Right, that discusses the advantages of using checklists in all types of activities from surgery to disaster recovery to business.
As leaders, we need to follow his advice and use checklists regularly to help improve our companies.
Our words matter.
As leaders, we spend much of our time communicating with others through our actions, our body language, and especially our words.
Unfortunately, all too often we do not use our words well leading to poor communication and poor performance.
Some thoughts on using words well: