Agility, High-Performing Leaders, and Embracing Change

A study from the Institute for Corporate Productivity i4cp shows correlation between leaders in high-performance organizations and agility, but fewer than half claim to be good at it.

Those companies that have consistently outperformed competitors in profitability, market share, revenue growth and customer satisfaction - dubbed high-performance companies by i4cp researchers - reported much greater agility than their lower-performance counterparts:

• Almost 60% of high-performance organizations are adept at identifying and making needed incremental changes, versus only 35% of lower performers.
• Nearly the same amount (58%) recognize and respond to strategic challenges in a timely manner, while only 30% of low performers do the same.
• A little under half (49%) of high-performance organizations are proactive in anticipating and initiating the changes needed for sustained high performance, compared to only 20% of low performers.

BOTTOMLINE:  "Most organizations understand the need for agility; what they don't understand is how to create a more agile culture. Our research and work with our member companies has uncovered some important findings about creating a corporate environment that doesn't just "manage" change well, but instead embraces change as a competitive advantage."

Strategic Thinking vs. Strategic Planning

Are strategic thinking and strategic planning - the same thing?

While they certainly related and complementary, thinking strategically and planning strategically are two different concepts.

Let's first consider strategic thinking, which involves viewing your organization from a holistic perspective.

Research has determined that strategic thinking can be explained through seven dimensions:

1. A vision of the future
2. Strategic formulation and implementation
3. Managerial role in making strategies
4. Control
5. Managerial role in implementation
6. Strategy making
7. Process and outcome

Strategic thinking is extremely effective and a valuable tool, and requires developing skills in creativity, problem solving, teamwork, and critical thinking. The good news?  It's a skill that can be learned.

Steps in building strategic thinking skills:

1. Critically examine and evaluate the existing situation. Understand what is being done, if it needs to be done that way, and fight hard against the "we've always done it that way" mentality.
2. Look at your business as a holistic system. Strategic thinkers view their businesses as a whole: its strengths, weaknesses, opportunities and threats.
3. Focus on the future. Strategic thinking is future-oriented. Before considering the viability of ideas, consider their potential contribution to the future of your organization.  
4. Continuously ask for feedback from your customers. Strategic thinking cannot be effective if done in a vacuum. 
5. Get realistic data for confirmation. Strategic thinking requires making predictions about the future and forecasts must be realistic. Gather reliable data to justify and confirm your predictions. 
6. Align your thoughts to your organization. Review your organizational structure to determine if the organization and key leaders are in place to fulfill your vision, otherwise it's a pipe dream.
7. Be ready to consider change and unexpected challenges.  Flexibility is a critical element of strategic thinking.

Strategic planning, on the other hand, is a continual planning process that relies on strong strategic thinking. When done correctly, strategic planning  is not a one-time or annual event.  It's an on-going process, reviewed quarterly, that affects the organization's initiatives, plans, and activities. 

BOTTOMLINE: Both strategic thinking and strategic planning are important - even vital to your organization - and neither can be ignored.

(TIP: For more on strategic planning, search this blog for "strategic planning" - you'll find dozens of related posts, hints and tips are available to you!)

The Top CEO Concern Three Years Running: Excellence In Execution

According to the latest results from the CEO Challenge 2010 Survey produced by The Conference Board, the critical issues of excellence in execution and consistent execution of strategy by top management once again remained at the top of the list.

In addition, this latest survey (which was fielded October-December 2009) revealed such growth-oriented challenges as sustained and steady top-line growth, customer loyalty/retention, and profit growth received higher ratings as "greatest concerns."

Also moving up were corporate reputation for quality products/services, and stimulating innovation/creativity/enabling entrepreneurship.

Here's links to their two previous surveys in which execution was named the top priority:

Executing Strategy - Once Again The Top Priority for CEOs

Excellence of Execution is Top Concern for CEOs Worldwide

The Benefits Of A Formal Strategy Execution Process

Scott Cleveland reported that a managing director of the Palladium Group (think: balanced scorecard) conducted a survey that compared two groups, one with and one without a formal strategy execution process in place.

A formal process in their terminology means "strategy maps, derived projects and process improvements from it, and associated key performance indicators (KPIs) with targets reported in scorecard dashboards and cascaded down into the organization."

The results?

• 70% of organizations WITH a formal process were exceeding the performance of their peers in their industry, while in contrast only 27% of those without a formal process were.

BOTTOMLINE: The overwhelming majority of businesses (and particularly, small and midsized organizations) do not have a formal process for strategy execution. They do not have strategy maps, derived projects, process improvements and associated key performance indicators (KPIs) with targets reported in scorecard dashboards and cascaded down into the organization.

What kind of strategy execution process is your organization using?

Achieving Sustained Growth - Take Two

As reported in the Harvard Business Review's Daily Stat, the consulting group Bain's updated global database of Sustained Value Creators found only 12% of companies worldwide managed to grow profits and revenues more than 5.5% over the 10 years and earn back their cost of capital. 

Here's another take on the same issue: 

As reported in the best-selling book Six Disciplines Execution Revolution, (How Big Is The Challenge, page 29), a recent McKinsey study concluded that few large global companies outperform their competitors on both revenue growth and profitability over a decade. The consulting firm analyzed 1,077 companies according to revenue growth, profitability, and both measures. This study concluded that thirty of these companies were superior, based on growth over this period. Ninety-nine were superior performers by profitability. And only nine (.008 percent) out of 1,077 companies were superior in both categories.

BOTTOMLINE: Achieving sustained, profitable growth is very challenging, and the odds of success are low.  Achieving such balance and predictability is extremely difficult, and therefore, extremely rare. While this fact may be viewed as a deterrent to some, it provides insight into an enormous opportunity for building a business that executes more predictably than most. 

Identifying Growth Leaders In Your Organization

According to a Wall Street Journal article, "Growth leaders - most companies have managers who can turbocharge results. The trick is finding -- and nurturing -- them."

"Indeed, powerful catalysts for organic growth often exist deep within an organization, hidden and untapped. We're talking about a special breed of midlevel managers -- men and women who possess the vision, leadership and entrepreneurial talents that together make up what we refer to as a growth leader."

Find them, recognize them, and support them - or your competition - WILL!

How to Make Organizational Change Enduring

Here's a real shocker:

In a survey of 3,300 senior managers and human resource professionals reported by Rob Lebow in his Washington CEO magazine

• 75% of all organizational change programs fail

Why is change so hard?

Most organizations say their most important assets are their people, but few behave as if this were true. Change initiatives typically devote most budgets to structural issues such as technology and processes, not staff issues. There is still a whole notion of focusing on tangible assets and their impact on the bottom line, rather than the intangible assets, which are people. Organizations don't adapt to change; their people do.

Constant change in the organizational environment mean that leaders must not only learn about change and its impact on people and systems, leaders must be able to master the process of implementing change, just as their employees must learn to accommodate change.

Why do most change efforts fail?  Here's an analogy: As with a transplanted flower, it initially wilts after the transfer. However, in time with proper care, it stands upright again. With continued good care, it blossoms. The same holds true with the introduction (transplant or transfer) of a new system (a new idea, business-building method, best-practices, business improvement processes), the productivity curve drops (wilts) - but given proper support and care, the productivity curve loops upward on a continuous positive trend.


Transition trauma is little understood by business leaders, but it is a fact of organizational change.

Some misread the downward curve (wilt) as failure, often triggering inappropriate actions; rather then understanding it as transition trauma that is a normal readjustment, realignment and adaptive phase of change that requires trust, patience and on-going support.

To Understand Strategy, Look At What People Are Doing

Here's a profound observation from management guru, Gary Hamel:

"If you want to understand the real strategy, look at what people are doing!”

Indeed, more often than not, there are disconnects or gaps between the strategy that is formulated by the senior leadership team, and how the strategy is executed by the rest of the workforce.

Why the gaps?

Could be for a number of reasons:

• The strategy is not accessible/available to the workforce
• The strategy is not sound
• The strategy is not well understood

Most likely, the recognition and reward system that drives the daily activities and behaviors of each person in the workforce is not aligned with the strategy of the organization. How to combat this situation?

1. Make the strategy as transparent as possible. The mission, vision, values and strategic position of the organiztion MUST be transparent and available to everyone within the organization.
2. Establish Vital Few Objectives (VFOs). Most organizations have 2 to 5 times as many projects and initiatives going on than they can possibly address. Reduce the number of key objectives. Keep the VFOs simple - financial, customer, production, people - and let everything else go. Be very focused on a few things, and do them well.
3. Make the VFOs measurable. Define measures, targets, and create a small number of initiatives that support the VFOs. Assign responsibility and accountability to someone for each VFO.
4. Define an Individual Plan for each person. On a quarterly basis, develop a plan for every individual, assigning activities from each initiative. Have each person track time and progress toward achieving the stated outcomes. Measure progress and update status weekly.
5. Align recognition and rewards based on the achievement of outcomes. Recognition and rewards systems are not to be based on activities, but results.

BOTTOMLINE: What people spend time on should be based on how well your strategy, goals and initiatives are articulated. Reward and recognize workers based on how well goals were achieved (results), not on how much activity took place.

Latest Trends in Executive Coaching

Sherpa Coaching's  5th annual survey shows that the executive coaching industry survived the downturn, and is looking toward radical change in the near future. 


Key findings from the survey:

• When there is turnover in top management, there’s a need for leadership development. 
• Emerging leaders must learn how to listen and communicate well, deliver clear expectations and make accountability a positive force in the workplace. 
• Ideally, executive coaching creates those positive changes in business behavior in a limited time frame.
• Executive coaching is seen, more and more, as part of succession planning.
• Do executive coaches follow a published process?
• 40 percent of executive coaches ‘develop a unique approach from one client to the next'.
• An additional 40 percent have ‘developed their own process for coaching’.
• Only 20 percent follow a published process that guides their coaching engagements.
• Since 2006, the delivery of executive coaching services has moved decidedly toward in-person encounters. 
• In this year’s survey, there's change in practice that goes against the tide: phone coaching held steady, while webcam coaching took a couple of percentage points away from in-person engagements. What stalled the trend toward live coaching? 2009 was an unusual year, based on budgets drawn during a stock market crash in late ‘08. The call for cost reductions favored remote coaching, hence an increase in webcam engagements.

Strategic Planning Going Away? Not So Fast!

The way this Wall Street Journal article portrays it, "the recession has changed the way business leaders think -- formerly reliable tactics no longer work and innovative strategies are becoming the new standards." 


One standby that may have gone out the window, the WSJ article argues: strategic planning.


In fact, NOTHING could be further from the truth!


If you really read between the lines of this article, strategic planning isn't going away at all.  Rather, it's becoming even more important - and will become an even more pervasive activity as we move ahead beyond the recession and into the recovery. 


"Old" practices, such as updating the company budget on a quarterly basis, are being replaced by monthly updates. One-year and three-year strategic plans are being reviewed and adjusted on a monthly basis as well, to faster respond to fluctuations in the market.


According to The Business Insider, "...even as the economy stabilizes, these new habits might just stick. Valuing flexibility over sticking to a long-term plan allows companies to better react to consumer changes and take advantage of fleeting opportunities, and that extra work and attention can result in better business overall."

The Five Domains of High-Performance Organizations

According to The High-Performance Organization Survey that was conducted by i4cp in December 2009, one thing is clear: there is no single organizational element that is correlated with high performance. Rather, there are five.


For decades, the research team at the Institute for Corporate Productivity (i4cp) has studied what separates high-performing organizations from their lower-performing counterparts. The results of that research have consistently shown that companies that excel in the following five domains are typically high performers:

• Strategy
• Leadership
• Talent
• Culture
• Market

The results were interesting, if not startling. The gap between higher-performing and lower-performing organizations has widened considerably from previous studies.

You can download their white paper here: The five domains of high-performance organizations. 

Change Is Inevitable. Failure is Optional. What’s YOUR Plan?

As the old saying goes: “If nothing changes, nothing changes.”

People and organizations have only two alternatives: get better or get worse, improve or decay. And it’s a constant battle. Our choice is to manage this ongoing process and improve the things that can be improved, or ignore the process and decay. This principle is just as important in life-long learning as it is in organizational change.

The challenge for us as individuals, and for organizations, is how to keep on the “upward vector” of growth, innovation, improvement and continual learning. It can be done, but it takes positive, continuous energy and communication.

But first, we need to understand the dynamics of change.

Which Comes First: Process or Behavior?

Many leaders address the change challenge in a very clinical fashion, going first for the process, the policy or the procedure. Fixing or otherwise improving a process usually involves changing it in some way. But, which comes first: process or behavior?

Effective execution of strategy ultimately requires change first in the behaviors and attitudes of leadership – and of all employees –before processes can be changed. One failing in most business improvement approaches is the tendency to develop new or ideal processes on paper, without addressing elements of human behavior and human nature. Perhaps it’s an over-reliance on highly data-driven methodologies like Six Sigma or lean. In these scenarios, the expectation is if we can use good quantifiable data to demonstrate that a process change will result in an improvement, then people will automatically change their behavior. On the contrary, our experience and research tells us that behavior change requires time, effort – and most importantly – discipline.

For any enduring change to take place, behaviors (habits) need to change before processes can successfully be changed.

To understand organizational change, three simple behavioral laws emerge:

• Any work behavior (verbal or physical) that works (pays off, is successful, gets us what we want) is repeated.
• Any work behavior that avoids a negative experience (criticism, needless effort, appears inept, avoids something we don't want) is repeated.
• Any work behavior that leads directly to a negative experience (discipline, embarrassment, needless effort) is not repeated.

BOTTOMLINE: The often used blanket comment; “I don’t like change” is untrue. We generally like changes that affect us positively, but tend to resist changes that affect us in a negative way. In other words, “We don’t resist change, we resist being changed.” What people need is a new perspective on change, and how it will benefit them.

The Top 10 Reasons To Measure Results

The need for measurement may seem obvious, however, more often than not, it's overlooked as being unnecessary by many leaders of small and midsized organizations.

Let's look at the top 10 reasons why your organization needs to measure its results:

1. Measurement clarifies expectations. Measures are a the most transparent and clear means to communicate expectations to employees.
2. Measurement directs behavior. Most employees consciously or unconsciously operate on the following assumption: “tell me how you'll measure me, and I'll tell you how I'll behave.”
3. Measurement increases objectivity. Measurement is essential to “managing by fact” – otherwise you are left to lead with charm and personality.
4. Measurement makes performance visible. If it’s not being measured, it simply can’t be managed.
5. Measurement focuses attention. When people are faced with so many competing priorities for their time and activities, what is measured tends to get their attention – particularly when it is linked to a recognition/reward system.
6. Measurement promotes consistency. Unmeasured systems tend to be highly variable systems, with all the negatives for quality that implies.
7. Measurement facilitates feedback. Feedback in the form of timely, relevant measures is the basic navigational device of any individual or organization.
8. Measurement improves decision-making. One of the major causes of failure in decision-making is poor or non-existent use of data. One accurate measure can be worth a thousand opinions.
9. Management promotes understanding. Quality guru W. Edwards Deming thought that systematic process measurement led to the “profound knowledge” that was essential to top quality outcomes.
10. Measurement improves execution. As former Allied Signal CEO and co-author of Execution Larry Bossidy has remarked “when I see companies that don’t execute, the chances are high that they don’t measure.”

How Accountability Works

There's a lot of talk going on these days about accountability.

For some, it's important for their professional lives (i.e., setting business goals, keeping on track, being responsible, etc.) For others, it's more personal (i.e., diet, weight loss, exercising, etc.)

Whatever the case, it's important to understand what accountability is, and ultimately, how it works. Here's a short course:

What is accountability? Why is it important? If you walk into a room and ask ten people what accountability means, you’ll likely get ten different definitions. To some, it’s something you make people do, as in “holding people accountable”. To others, accountability means accepting responsibility, but only when a project goes off course, or it’s too late to fix. When it’s all said and done, a workable definition of accountability might include the following elements: Taking responsibility for your own behavior; doing what’s right consistently; demonstrating personal integrity, and actively participating in activities and interactions that support the strategy of your organization.

Now that we understand better what accountability is, now consider what it isn’t. Accountability is not something you “make” people do. It has to be chosen, accepted or agreed upon by the people within your organization. People must “buy into” being accountable and responsible. For many, this is a new, unfamiliar, and sometimes, uncomfortable way to work or live. Learning how to become accountable involves an element of discipline. Most importantly, individual purpose and personal meaning comes from accepting responsibility and learning to be accountable.

Holding people accountable is really about the distribution of power and choice. When people have more choice, they learn to be more responsible. When they become more responsible, they earn more freedom. By being accountable, they earn the trust of managers and coworkers. When they are more accountable, they understand their purpose and role within the organization and are committed to making things happen

How can you learn to be accountable for yourself? In reality, it’s very difficult to be accountable to yourself. Depending on your frame of reference (professional vs. personal) you need to find someone who can help you to stay on track, to stay focused. Accountability can be the catalyst for unlearning old habits, and learning new habits. For weight loss, it's the reason that WeightWatchers is a multi-billion dollar business. It's also no secret that the tremendous growth in business coaching (for example, like Six Disciplines) due to its success in applying the benefits of external accountability coaching.

BOTTOMLINE: Accountability and positive organizational change come through a new set of conversations. So, what are you waiting for?

Building A Strategy-Focused Organization

Robert Kaplan and David Norton are respectfully, the "fathers of the Balanced Scorecard."

In this article, Building a Strategy-Focused Organization, Kaplan and Norton land on a number of principle "truths" about strategy - and execution:

• A recent study of 275 professional portfolio managers reported that the ability to execute
  strategy was more important than the quality of the strategy itself.
• In the early 1980s, a survey of management consultants reported that less than 10% of effectively formulated strategies were implemented successfully.
• A 1999 F ortune Magazine article, in a cover story of prominent CEO failures, concluded that the emphasis placed on strategy and vision created a mistaken belief that the right strategy was all that was needed to succeed. The authors concluded that “…in the majority of cases—we estimate 70 percent—the real problem isn’t [bad strategy]…it’s bad execution.

BOTTOMLINE: "Strategy must be understood and executed by everyone. The organization must be aligned around its strategy, and performance management systems help create that alignment."

How CEOs (Should) Spend Their Time

Dr. Theresa M. Welbourne from both the Ross School of Business, University of Michigan and eePulse, Inc. released research examining how leaders (CFO) spend their time and how that time spent is associated with firm performance.

The basis for the study is assessing manager and leader performance based on five roles. These roles have been found to be critical for understanding overall, individual and firm performance and include:

• Job: Reflects the basic core job one is hired to perform and is often well described in the typical job description
• Team: Reflects responsibilities for ongoing and project-based teams
• Career: Includes responsibilities to enhance career and skills
• Innovator: Covers work spent to develop new ideas, create new routines or improve on process
• Organization Member: Reflects work done to support company overall, when it is not part of the other roles

The study indicated the average, overall percentages of time spent in each role, from high to low, as follows:

• Job - 45%
• Innovator 19%
• Team 16%
• Organization 12%
• Career 8%

BOTTOMLINE: “The average time spent by CEOs in particular in the job role, within a high performing company, is 36% versus 46% for the low performing firms. This is not surprising in that we know long-term competitive advantage comes from a workforce that is spending time doing things other than the ‘core' job. If employees are focused only on the job, everything that your company does can be easily copied by your competitors and replicated easily. Long-term
competitive advantage comes from the right combination of core job and non-core-job roles.”

Communicate Your Organization's Goals - Or Else!

Here's a major wake-up call!

According to research commissioned by the UK's Department for Business, Innovation and Skills, only 24% of employees know their firm’s goals for 2010.

Other key findings:

• 32% even doubted there was a plan for their business at all.
• Only 27 per cent of people said they were fully prepared for the challenges they would face at work in the year ahead.

"This is just one example of how poor employee engagement can put the brakes on improved business performance. If leaders don't explain where the business is going and what it's seeking to achieve, how can people be motivated or know what they're meant to contribute? Clear goals are a key ingredient for achieving performance and productivity - but worryingly, this research suggests many employers haven't yet grasped this for 2010."

BOTTOMLINE: Here are some specific steps you can take now to ensure employees are engaged and ready to do their part for executing strategy in 2010.

1. Renew your organization's mission, vision, shared values, strategic position, create a short list of vital few objectives, and put together a list of things to stop doing.
2. Develop a strategic plan that outlines a short list of key initiatives that will drive activity toward meeting those objectives. Assign responsibility, key targets, outcomes and create measures to track progress.
3. Communicate the results of #'s 1 and 2 to everyone in the organization - in multiple ways, on multiple occasions. (That means two-way communication, which includes listening.)
4. Align the organization's resources (people, technologies, processes, policies, measures) to support these initiatives.
5. Have each person in the organization develop an individual plan of activities for the quarter, which align with the key initiatives they're working on. Hold short status meetings with team leaders weekly to track progress, to identify areas of risk, and provide enough time for continual course correction.
6. Measure results quarterly (not activity), review individual performance (and use 360 feedback surveys), survey stakeholders' satisfaction regularly, and review internal strengths, weakesses and external opportunities and threats.

(Want more specifics on how to accomplish these steps? Read Six Disciplines for Excellence.)

Why Your Organization Needs More Than A Business Coach

In sports, no one questions the importance of having a good coach.

In music, art, science, no one questions the importance of having a good mentor.

If you're running a small business, why should it be any different?

Yet, everyday, leaders of small and emerging businesses continue to waste thousands (if not tens of thousands) of dollars on ineffective means to the end: learning to develop a top-performing business.

We hear it from our clients all the time: "I spent thousands on books, seminars, consultants; we've gone through planning sessions, brainstorming, etc. - and none of it has lasted."

Frustrating? You bet.

Common place? More than we all want to admit.

For 2010, are you hoping for the best? Well, hope - is not a strategy.

Well, there's always "business coaching" - but buyer beware: You actually need more than just a "business coach."

You need a holistic approach - a complete program that includes a repeatable business-building methodology, an external business coach (for accountability), execution software that enages every person, every day, and access to a shared learning community for faster adoption and stronger organziational engagement.

Do you - and your organization- need more than a business coach? Are you challenged with any of these?

• A lack of a solid strategic plan - mission, vision, values, strategic position, vital few objectives
• A lack of well-defined goals - specific, measurable, attainable, realistic and tangible (deadlines and attributable responsible people)
• Wasted time and resources - your people are working on things that do not align with your strategy
• Procrastination, distractions and working on "urgent" things - rather than "vital" things
• Lack of individual accountability - and organizational "entropy"

Do any of these sound familiar? How about all of them? You aren't alone. Every client we talk to has one or more (and sometimes, all) of these challenges.

It's time you looked into Six Disciplines....

What We Have Here - Is A Failure To Communicate

(This guest post was authored by Eric Kurjan,President of Six Disciplines Ohio/Indiana. Six Disciplines brings “big company” process improvement to organizations looking to break from the status quo. For more information visit www.SixDisciplines.com, email ekurjan@sixdisciplines.com or call 419-348-1897)

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As businesses are coming out of the economic downturn, they are starting to recognize that they need to do something different. However, that is a highly complex statement. What can you possibly do differently? Well, in most cases the list is enormous. There are plenty of things to work on.

If you followed my advice in my October article, then you are headed down the right path. There is a long way to go to get to the final destination but if you have defined that destination at least you know where you want to go. Now, how to do I get there? The first step is to communicate that information to the rest of the team. Where are we going, what will we do to get there, how will we do it and who is responsible for the various steps and actions? Those four basic tenets are the key drivers of strategy formation and more importantly the execution. But there is something more.

For some reason, asking CEOs/Presidents/Owners to share this type of information with their teams seems to be a very foreign concept. There is the unreasonable expectation that the team members/employees somehow already know where they are going and how to get there. Most folks are not great mind readers and then they end up doing whatever they think is best because as leaders we have not communicated what we need or want. As someone wise once said, “The biggest problem with communication is the illusion that it has taken place."

In fact, the larger the organization is, the greater this illusion becomes. As organizations grow, communication challenges grow as well. These challenges will grow dramatically faster than the organization headcount. To illustrate:

• In an organization with 3 people, there are only 3 possible different interactions.
• In an organization with 25 people (8 times as many people), there are 300 possible different interactions = 100 times increase in the complexity of communications
• In an organization with 100 people (33 times as many people), there are 4,950 possible different interactions = 1,650 times increase in the complexity of communications

Growing organizations respond to increased complexity by creating layers (business units, divisions, departments, teams, groups, etc.). Add to this challenge -- 55% of communication really takes place through non-verbal body language (not phone, not email, not IMs, not video conferencing.)

So, we have some pretty big issues to overcome to get people on the path we want. Unfortunately, we have leaders who don’t share the company message, direction or expectations with their employees, and then couple that with the complexity of a growing organization. In the absence of leadership, employees decide their own direction. Often times the intentions are good; however, they do not always align with what management sees as important.

Gary Harpst, the founder of Six Disciplines, tells a very poignant story of “Susan”. “Susan” works for a very good commercial HVAC (heating, ventilation, air conditioning) contractor in the Midwest. She has been an excellent, loyal, hard working inside sales employee for the past seven years.

This morning she has a conversation with her leader, the manager of inside sales. He tells Susan that the numbers on the commercial business are off for the month. Their normal commercial clients are not upgrading and new construction is terrible. He tells her that she needs to get more deals in the door, somehow. Seems pretty straightforward and probably a conversation repeated in organizations all across America. Being a creative and hard working person, Susan is looking for any new business she can find. In good times, the pipeline has been plentiful with commercial deals and anytime a residential sales/service call came in she turned them away.

However, now based on the conversation she had with her manager this morning, she “decides” to take on a residential opportunity. She completes the paperwork, sends a service crew to the residence and thinks she has uncovered a new opportunity. However, she has created a nightmare. The work crew is not trained to work on residential HVAC systems, they do not carry the parts, the business model and cost structure are not compatible, and on and on. Susan’s decision is full of good intentions but her self-directed approach is fraught with issues. And it all started with a lack of clear direction and communication.

This type of disconnect is very common, and it is all about the lack of communication.

Communication also ties to overall employee performance. Yes it is true, not only do you need to tell your employees what they need to do and what you expect of them but you also need to share with them how well they are doing their jobs.

SuccessFactors surveyed 3,600+ workers at 291 companies and found, among other things,
• 51% of employees don’t know whether their performance is where it should be
• 66% say they have too little interaction with their boss
• 55% don’t get enough timely constructive criticism

BOTTOMLINE: It all comes down to communication. You should try it. Set the direction, define the actions and measure the results. The investment is small, but the rewards are huge.

Plans Are Nothing - Planning Is Everything

The importance of business planning is frequently misunderstood.

Here are 9 commonly-held myths: about business planning:

1. Most small and new businesses don’t need business plans.
2. You need an MBA to write a convincing business plan.
3. Business plans are only necessary when you need to raise money.
4. Business plans need to be long and address every last detail.
5. Writing a business plan makes your business less flexible.
6. Writing a business plan takes too much time.
7. All the details of a business plan are just too confusing for a first-time business owner.
8. You can get funding on the strength of a great business plan alone.
9. If you’ve already launched your business, it’s too late to write a business plan.

BOTTOMLINE: As Dwight D. Eisenhower once said, “Plans are nothing; planning is everything.” He wasn’t actually saying that plans are worthless, of course. So what did the war hero and former President mean?

It’s the process of planning that is most important: where you consider opportunities and challenges and ways to meet them.