Strategy Communication - Avoiding "Same Old, Same Old"

When I spoke at Minnesota Manufacturing Group earlier this week, there were a lot of really good questions.

One was how to avoid the reaction of "Same old, Same old" - when the strategy is met with eye-rolls, muttering, and the attitude "This, too, shall pass" or "We can just wait this out - no need to change a thing!"

The reason so many have seen this reaction is that it works.  When an organization's leaders don't have the guts or genius to create a meaningful strategy, or lack the discipline to pick one and stick with it until it works, strategy can easily become a "flavor of the month."

Why's that so bad?  Well, for one thing, it increases organizational cynicism, a highly toxic force in organizational life.

For another, it stimulates or re-inforces lack of confidence in the leaders, since creating strategy, communicating it in ways that matter, and leading its execution is some of the most important work leaders do.

Especially when times are uncertain and challenging, communicating the vision in a way that reaches people's hearts, communicating the strategy in a way that makes sense - again, and again, and again - is a leader's most important work.

So, how to avoid the shrug reaction?  Several key points -

Reach hearts with a high goal.  The vision part needs to be a worthy cause, something that engages employees by seeing that this work makes a difference.

Challenge minds with an ambitious target.  People are motivated by a goals that are not too easy and not impossible.

Engage people with goals and problem-solving.  At all possible levels, set goals that align with and contribute to the strategic plan, so that everyone can see their part in achieving it.

Over-communicate the vision and plan, at all times, to all stakeholders.  When you think you're wearing it out, you might just be getting started!  Great executives can always communicate the objective, scope, and advantage of the strategy - and do!

Connecting strategy and metrics - why, and how - dashboard quality

Did a talk this morning at Minnesota Manufacturing Group - the "7 Mistakes" talk from July, slightly revised.

Tremendously experienced and sharp group, asked some great questions - like how to measure and find the discipline of execution. like how to keep strategic plans from being perceived as "same old, same old," like the time horizon of long-term plans, like how to optimize ownership and accountability at the right levels.  Reflecting on the answers will take several blogs!

Some organizations do carry their strategic plans over from year to year.  If it's working, that's great.  But the question is how do you know it's working, and that gets to metrics.

A strategy without a dashboard is almost useless - and creating the dashboard is where the first hard work comes in.  There should only be a few metrics, since humans can focus on a few things, especially for a prolonged period of time.

And if there's only a few, then they'd better be good ones!

What makes good dashboard metrics? 

They're forward-looking.  On sales, for instance, you need good information about what's in the funnel (or pipeline) several months out, with appropriately cautious metrics that there won't be many surprises.

They're timely.  On customer satisfaction or employee experience, an annual survey is too long to wait to find out if there's a problem!  Better to have smaller samplings more often to keep a finger on the pulse so that corrections can be made when needed.

They measure what matters, rather than what's easy or traditional to measure.  When a call center realized what pressuring to reduce time-on-call meant for customer satisfaction (strong negative correlation), they switched to randomly sampling customer satisfaction, without pressuring agents to get off the phone quickly.

They're trustworthy.  The old adage of "garbage in, garbage out" is as true today as when the phrase was first used in the 70's - you can't make good decisions on bad data.  If a key data source is compromised, leaders need to clean it up or find other data to inform the same objective.

They're strategically consistent.  One person from Minnesota Manufacturing Group told the story of an organization he knew that measured salespeople on gross revenue, and production on cost-savings.  Can you guess what these competing metrics created?

Next strategy blog - how to avoid "same old same old"

Better at Consulting Than Selling

Preparing for the micro-seminar on prospecting, I realize that I'm not much of a salesperson - and that's OK!

One of the ways I work with clients is to teach them to sell - So don't I have to be a super salesperson myself to do that?

Does Rafael Nadal's tennis coach need to be a better tennis player than Nadal?

No, because playing great tennis is not what he does.  The coach's skills are knowing what "great" looks like, how the timing works on Nadal's serve, how he's managing his attitude from moment to moment, what mistakes he tends to make (and there aren't many!), how to get his attention and give him important feedback at just the right moment.

In the last two years, I've worked with several clients who are better at selling than I'll ever be.

What I've helped them do - in some cases like second nature, automatically - is do better homework, figure out their target markets more precisely and frame their whole approach around client needs, not their product.  They know how to make a good first impression, they know what to do next - and why - at any given moment.  They ask better questions, and they're really great listeners.  They help their customers find value in what they offer, from the customer's perspective, without pushing. They also know when to ask for the business, and when (and how) to ask for referrals. They get results!

Their skill is selling.  Mine is helping them get better at it, as their advisor and coach, working from the sidelines, not the field.

Why strategy matters in uncertain times - From Today's Radio Show

Today I was on Peter McClellan's radio show on Twin Cities Business Radio, and we talked about why strategic planning matters most when things are most uncertain.

(If you'd like to hear the whole show, here's the link:  http://thinkonangus.podomatic.com/player/web/2011-10-10T08_38_40-07_00)

As for why an organization would bother with strategic planning now, in the fourth quarter, with all the uncertainty and doubt -- I believe, as many have said, that the best way to predict the future is to create it yourself.

I think the reason that so few companies devote the sort of careful thinking and attention to strategy is that they're overwhelmed.

Overwhelmed by busy-ness, with just too much to do.
Overwhelmed by uncertainty, not knowing what new bad news will come next from the economy or politics.
Overwhelmed by fear of the future, believing it could all fall apart.

But I'm finding with current clients that attention has power.  When we focus on the future we want, and hold that focus long enough for it to become a plan, it starts to take on substance.  With more attention and a bit of discipline to stick with the planning until it's done, it becomes a guiding force.

And when the strategy is set up, everything actually gets easier.

Sometimes the most important information from the process of prioritizing and making strategy is deciding what blinders to wear.  What will you deliberately ignore, that would otherwise frustrate or distract you?  What opportunities will you pass up, so you can focus on what will get you closer to the vision you want?

Networking as business development strategy - Improving how it works

This year there's a lot of news and new approaches in networking, yet some things always remain the same.

There are new approaches to networking advocated by the folks at ProIntroNet, which launches groups with an education-oriented focus and an approach they call "golden rule networking."  Also went through some training based on "7-Levels of Communication" book by Michael Maher - interesting ideas, and I'm putting some in place. A group at TwinWest Chamber of Commerce just re-established its purpose - why we invest time in networking together -- it's not about collecting business cards or meeting a referral slip quota, but about helping each others' businesses grow.

So, what remains the same?  Some things work, some things just don't work, and it all comes down to attitude.  Here's 3 of each -

3 things that work

• Right places, at the right levels.  While you never know who someone knows, if you want to meet bankers, networking with website developers or multi-level marketers is not a good investment.
• Repeated contact and presence matter.  People have to know you, like you, and trust you to refer you, or even be OK with being asked.  If you join a group or attend a recurring event, at least be a regular and a contributor, if not an organizer.
• Good first impression, then consistency.  To earn people's trust, you have to reliably do what you say you will do.  In networking, that means showing up and contributing.

3 things that DON'T work --

• Pitching.  Soliciting a sale on first contact is enormously ineffective, and usually makes a lasting bad first impression.
• Asking near-strangers for referrals.  Why would anyone refer a valued client or person of importance to a stranger?  That "know-like-trust" has to happen first, or asking is rude and pointless.
• High volume card exchange.  If someone wants your card, they'll ask for it; if you push it on someone, it may find its way to the trash by the Exit; it will not ever result in follow-up.

Why do people still do these? If you know, please reply!

3 essential attitudes for effective networking

• Curiosity.  When meeting new people, you never know what interesting things you might learn. Genuine curiosity about the person, their life, their work always leads to learning of some sort. 
• Connection.  Wanting to discover real points of connection - common interests, people, history - and willingness to explore them is good conversation, at least, and could lead somewhere.
• Giving.  Really having the attitude of giving - making connections, recommending resources, paying attention, being fully present - is the most important single truth about networking.  You have to give before you can expect to receive - and if you focus on giving, it works.

Effective Learning for Growth occasionally does workshops on networking, at high efficiency and low cost.  These are intended for those who want to change their perspective or sharpen their skills, and include some fun elements ("how to handle a bad handshake" or "how to remember names" for instance).  To see when the next one's coming, check here: http://www.effectivelearningforgrowth.com/events.html

Strategy Mistakes - part 1 of.....

Just gave a talk this morning at a breakfast for strategy-makers, on "7 Costly Strategy Mistakes."  So for a while, I'll be doing "highlights of..." or "best ideas from..." in this blog on Strategy.

The first costly mistake is "the Secret Strategy" - where the owner / founder / president is the ONLY one who knows what the strategy is.

Is that crazy, or have you seen it, too?

In the case that led to naming this, a business owner actually told me "No, I don't tell my people what my strategy is.  We have high turnover in this industry, and if I tell them what it is, my competition will know it within a few months."

I had to bite my tongue to resist asking the "Dr Phil" question: "How's that workin' for ya?"

What I did instead was to ask more specific questions about the impact on several areas that are predictable problems with the "secret strategy" approach:

• The owner has to make all the decisions, because he/she's the only one who knows the strategy and real priorities.
• Because of that, the owner is always "fighting fires" and handling crises caused by the players not knowing the playbook.
• Because of that, employees who are bright, have initiative, and prefer some autonomy start to feel stifled and "second-guessed."
• Because of that, the best ones leave, creating a self-fulfilling prophecy about turnover, leaving the owner having to replace good talent and scramble to cover in the meantime.
• Because of that, the customer experience suffers from mistakes, churning, and a succession of new customer-facing reps - not the way to inspire confidence or loyalty!

What does this cost?

Attrition costs at least 25% of annual salary - even for low-skill, minimum-wage folks.  For skilled customer-facing people, for those with high technical or good sales skills, the cost is a higher percentage of a higher salary.  For great salespeople or senior customer managers who have "a following" - the real cost of replacement can be more than their annual salary!

Even at the 25% level, if you replace 4 per year, you're paying the equivalent of a year's salary for a ghost - the "dearly departed" takes on a different meaning!  It's hard to get profitable when you're paying salaries for empty cubicles.

And what's the cost in customer confidence and loyalty, when they get a new person every time they call?

Customer loyalty is a predictable casualty of high turnover and the sort of mistakes caused by customer-facing staff clueless about the strategy.

That could be so costly it drives a company out of business.

In the best case, it creates a tough hole to dig out of -- and an unnecessary one.

Please comment!  Have you known companies with a "secret strategy?"  How do the consequences and costs reflect what you've seen?

Next week, the next costly strategy mistake - "Strategy without Contingencies"

Strategy - Who cares? What's it worth?

Strategy has gone through ups and downs, ins and outs historically.  From the graduate school course I've taught on it, it has cycled through periods where companies spend massive resources gathering data, reporting up in endless detail, and creating strategy, all the way to periods where some companies rejected the idea of having one at all (we seem to be closer to that, now).


An article in Harvard Business Review said "It’s a dirty little secret: Most executives cannot articulate the objective, scope, and advantage of their business in a simple statement. If they can’t, neither can anyone else" (Collis & Ruskad, 2008, p. 83).

So what?  What's lost if most people in the organization couldn't say what the strategy is?

A couple of important things - coherent decision-making at the right levels, and alignment.

Coherent decision-making means that everyone who might have to make a decision knows the direction and priorities.  That reduces waste of precious resources (like the leader's time!), and costly errors.

Alignment is a subtler benefit.  When everyone knows where the organization's heading, and why, and that direction and strategy mean something to the people in the organization who have to make it happen, better engagement happens.  The work means something, so people stick around, give more of themselves, care about quality and customers, and work together to achieve more.

Employee engagement is at an all-time low.  Some estimate that most people would leave their current jobs if they could find another one tomorrow.  What sort of performance does that mean?

So, if an organization doesn't have a strategy, or its members could not say what it is, where do you start?

That's in next week's blog...

Sales Management - Career Path for Top Performers - Really?

In a conversation with a top-performing salesperson in factory automation software for several years, I mentioned the premise of my book on the transition to sales manager, and was surprised at his response.

Maybe he's onto something...

I shared the statistic that 85% of top salespeople who are made sales managers don't last a year and leave the company, and he said that he hadn't seen that happen much.  He agreed that top salespeople don't often make good sales managers, but said that top salespeople he's know don't accept the promotion, if offered.

When I asked what he saw instead, he said "The really good salespeople don't WANT to be sales managers - the ones who DO want to be sales managers are the ones who struggle with sales, who are burnt out, who want to escape the pressure of continually making the numbers."

So, in your experience, is this a stereotype?

Or do companies that promote a struggling salesperson to be the sales manager have the right idea - IF certain other traits and characteristics are there?

I've been interviewing successful sales managers who were top performers to identify what traits & characteristics they have in common, so that whether a company promotes the top performer or someone else, they'll stand a better chance of success...

More on those traits and characteristics next week...

Nice article on bad strategy

McKenzie Quarterly's June issue has a good article on bad strategy that got me thinking about the "7 Strategy Mistakes" I'm presenting in late July. Some of what the article lists is also what's in the presentation.

The article lists the hallmarks of bad strategy are failure to face the problem, mistaking goals for strategy, bad objectives (fuzzy or "blue sky"), and fluff.

The article attributes the abundance of bad strategy to inability to decide, and to following a template-style strategy.

It's on the last point, his assertion that templating the vision, mission, values, and strategies always leads to empty rhetoric and fluff, that I believe the author is mistaken.

Of course, using a template poorly can go wrong .  If an organization found a strategy self-help website and approached it as if playing "buzzword Mad-Libs" they'll get meaningless fluff.  In the worst cases I've seen, they may work on it so hard and so long that they start to think it's beautiful -- often to the amusement of others.  What a waste when it goes astray like that!

But when leaders develop strategy well, they ...

• answer the hard questions in an honest SWOT,
• do the hard homework of figuring out who's the real competition and how to beat them, 
• do a cold-eyed, realistic assessment of the changing market
• make a coherent plan for using talent, finance, resources...

AND when they also really revisit the Why are we here? questions of vision, mission, and values (sometimes with help, when that's not a skill that the leaders start with) - then they can also engage the hearts, minds, and full talents of the organization.

Because the most brilliantly conceived competitive strategy won't make much difference if the organization isn't aware, aligned, accountable, and committed to it.

The article from McKenzie Quarter can be found at http://www.mckinseyquarterly.com/The_perils_of_bad_strategy_2826

Sales Manager Transition - What's the 1st year failure rate?

Attended a webinar from ES Research last week about the sales training industry. 

The founder, Dave Stein, dropped a statistic about the first year failure rate where companies promote their top-producing salesperson to be the sales manager.

It's 85%.

He's done a lot of research over the last several years, working with companies that provide or seek sales training, so I believe he's got it right.

My question is, why is it so very high? 

Why don't companies define the sales manager job to be one that a human can do, select the right talent, and support them toward success?

I'll be answering those questions in this blog in the near future, but I'd sure welcome any ideas or suggestions from any who read this blog!

A quirky sort of strategy research

For several years, I’ve been teaching courses on Strategy in a graduate business school.  Over a hundred learners have all done essentially the same project:  Based on the readings and research, evaluate your own organization’s strategy. What needs changing, and why? What are the consequences and opportunities?

The learners are all working leaders, often senior managers in some significantly large organizations; they roll their sleeves up and get it done every day. 

So over the years, I’ve started to see some of the same patterns again and again.  When things go badly wrong with strategy, they seem to follow one (or more) of a few specific patterns.

I’m also part of two different networks of consultancies, with Resource Associates (about 300 nationally) and with Association of Independent Business Consultants (over 1000 globally).  In “members only” discussions, I’ve floated these patterns of mistakes, asking if others have seen these – and they have.

In my consulting practice, addressing strategy with clients, some of these same patterns have to be overcome. 

When working for / with some well-known organizations over the last 15+ years, the same patterns were there, too.

So between direct, hands-on experience, polling other consultants, teaching, these patterns of costly mistakes keep popping up.

These patterns have predictable outcomes in how an organization operates, competes, and adapts.  Those outcomes can be very, very costly.   And some fairly simple (not easy, just simple) guidelines can keep organizations clear of these errors.  (These are forming into a "white paper" to be published this summer).

Next week – What is it about strategy that can go so badly? 

Sales Management Transition – How bad could it be?

Of all the mistakes companies can make, one of the most expensive can be a four-part train wreck that goes like this:

• Make a sales manager role that’s impossible
• Promote the top salesperson into it
• Give no coaching / training support
• Expect the new sales manager to “clone” him/herself among former peers

 What happens if this doesn’t work? Well, a lot, and none of it’s good.

•  The top-producing salesperson gets a job they can’t do and don’t like.
• Every motivator and source of satisfaction gets turned 180 degrees.
• The top producer’s clients may get ignored, and leave.
• Other good salespeople get frustrated, and quit (or stay, but just go through the motions – and may even complain to customers).

 

That’s a staggering cost! Many companies can't survive it.

 

I once asked a very senior executive in a major pharmaceutical company what a mistake in promoting a great rep to be a bad district sales manager might be. She had given it some thought, and answered quickly “At least $2 million – and that’s before the lawsuits!”

 

She explained “A bad DSM causes good reps to leave, and when they do, it can spoil the relationship they worked so hard to earn. Sometimes, a bad DSM creates so much stress that there’s a spike in health issues and absenteeism among the reps. And if the DSM puts too much pressure on reps to produce, they may start overstating what they say – and that’s where the potential lawsuits and major damage comes in. A really disgruntled, unhappy rep who sticks around for a few months can poison every relationship in their territory, and you just can’t easily come back from that.”

 

So why do companies promote a superstar into a job that’s set up for them to fail?

 

That’s next week’s blog.

 

Sales Star to Sales Manager - a Dangerous Transition

I've started writing a book about a transition many companies make:  They take their best salesperson, their best producer of new business - and make them the sales manager.

It does not often end well.  Most find that it's a job that's pretty much opposite of:

• what they like to do
• what they are able to do
• how they have succeeded before.

They often find everything that motivated them to be the top salesperson - getting to be the hero for the client, making the seemingly impossible happen, having a lot of autonomy and control, seeing the direct connection between their activities and their income - gone, and replaced by its opposite!

They often hate the new job, and fail.

I want to do something about that, so companies can make getting the right person into the sales manager job and getting them successful in it.

So I'm writing a book about how successful sales managers made that transition from superstar to sales manager, and learned to like the very different job of managing other salespeople and succeeding through others.

More to come in weekly (or more often) blogs on sales management transition.  Next week, The consequences - Just how bad can it be?

Good Networking Event

Many businesses I know count on networking as an important part of business development, and sometimes an event stands out.  One did for me late yesterday afternoon, and here's why, and what made it good.

It was crowded.  It was off in a corner of a popular bar, Oak City in Bloomington, and there were at least  40-50 people there.

What's good about that? Well, it reduced that awkward clustering that happens where there's more room to spread out.  It's easier to start a conversation with a stranger if you just turn around, rather than walk across the room.  There was some "breathing room" at the edges, for those who got a little claustrophobic..

It was quiet enough to have a conversation at the edges of the crowd, or even in the middle.

It mixed two groups that don't normally get together for the first time - the Linked Minnesota networking group and the CHAD Meet-Up group.  That made for a nice mix of familiar faces and people I hadn't met before. A banker I've met several times said he'd given my card to someone who needed some help with their business strategy, and I met a nice job-seeker who loves working in customer relations gave me a great reason to reach out to an old friend who may need someone in that role. 

I had good conversations and discovered some mutual interests with about four people there, and will be following up with them next week.

I'll be folding a few examples of things I saw (or did) into the Networking micro-seminar I'm doing next Friday.

Consultants Can't Sell

In the first 2 years consulting and coaching, I've helped clients learn to sell, or improve their sales. I've worked on my own sales skills, to "walk the talk."  After all, you wouldn't hire a tennis coach who didn't know how to play, or a consultant that had never solved a problem like you have, right?

Yesterday Jay Niblick (Innermetrix) used an example in a webinar for Assn of Independent Business Consultants that got me thinking a little differently.

What if you got a cold call - from a doctor?  Would you consider becoming a patient?  If you did, what would you expect about competence, quality, or price?

People hire consultants when they believe the consultant can help them fix a problem (or realize a dream) that they really care a lot about, and have the resources and willingness to get help.  They need the consultant to have expertise and be an authority in what they need, as well as the skills to help them make changes that work.

So what happens if a consultant starts to "close" - switching roles to a salesman to seal the deal?  Do trust and confidence naturally and automatically sink?

That's why, in my practice, I never "close" but only ask the same question every time, when my prospective client has seen that I'm a trust-worthy expert who can help them improve something that matters a lot to them.  That question is simply "What do you want to do now?"