Monday, June 27, 2011

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

Tuesday, June 21, 2011

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!

Friday, June 17, 2011

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? 

Wednesday, June 15, 2011

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.

 

Tuesday, June 7, 2011

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?