Hey Guys- Recently, I had an enlightening conversation with a CEO client about his work with his team. He had just a few weeks before he had taken over a new business unit with about $500 million in revenues. As the new leader, he was amazed by the disorganization and lack of clarity he saw. Sometime just from the disparate amount of work, he would just sit in his office utterly confused as he tried to figure out what triggers to pull to get the organization moving. There seemed to be so much to do, yet so many fragmented parts. My first suggestion was to divide the business into two areas of focus with two questions. 1. What were the immediate short-term activities (remember those executive functions; attending, inhibiting and working memory?) that were required in order to make the quarterly numbers that the investment bank and the board were demanding? 2. What were the activities that were required to get the business on the path of positioning it for the longer term that would drive its growth and build its value for the expected returns on investment past the near term? Focusing on just two specific categories gave him instant clarity. That is what executive functions do. They illuminate the path forward and inhibit others. So, he went to work on those. In our next meeting, he shared something really powerful that he had begun with his team that got them attending, inhibiting and remembering. It was exactly the kind of practice that I mentioned in chapter 2. He installed two monthly meetings that kept his team attending to, as he put it, the data in front of them. (Remember, attend, inhibit and working memory.) His first meeting was organized around this question, “Is the business healthy?” When I asked what you mean by healthy. He said there are two parts to healthy in how I define for them to focus on. First, is it predictable and shapeable? Meaning from a planned results standpoint, are we getting what we said we were going to get (is it predictable) and for the specific reasons we thought we would get it (is it shapeable)? He continued. So first we go through all of the key indicators and metrics to try and figure out where it appears out of control, i.e. where are not getting the results we said we would? Or, not doing what we said we would? Or things not happening as we predicted they would happen. Then, if we are not getting the results we said we would, we go to a root cause analysis to diagnosis what is the cause of that. If the expenses are not what we said would be, why not? If we said we would hire someone to drive something by a certain date and didn’t, why not? If we said we would sell x or y and didn’t, then why didn’t we? If we said this amount of marketing would produce this amount of sales in this region and it didn’t, why not? That will tell us what we can shape. Remember my emphasis earlier on what you can control and how to make corrections to shape it better next month. If we are not predicting results well then we have to do the things to shape different results. That leads us to health. It forces us to ask, “if something we expected to happen did not happen, how do we fix this so it will not surprise us again?” But then we go past that and this is huge. The fact that we did not predict well and did not shape well has caused a gap in our plans and budgets. If we predicted that the hire would have taken place and it was going to add value, we have to admit and own right now that there is a gap in our plan that is going to catch up with us if we don’t do something about the gap that is causing this problem. Said another way, it is not just about fixing it for next month. It is also about fixing the new problem that we have now because of what we missed last month. It really keeps us attending to what we need to attend to, inhibiting what we need to not have happen and keeping it all right in front of us all of the time. Cheers, Henry *From my book Boundaries For Leaders
Posted on: Wed, 14 May 2014 23:30:36 +0000
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