Showing posts with label Harvard Business Review. Show all posts
Showing posts with label Harvard Business Review. Show all posts

Friday, January 27, 2012

Why would my employees care about me?

Over the last 40 years of running organizations, I have come to understand why some managers are so autocratic in their management approach. It’s simple. They do a very poor job of hiring the right people. They may be good at assessing job skills and cultural fit, but most are extremely poor at assessing professional motivation. Why is that important?

I have long ascribed to the wisdom that people who care about you will work harder for you than people who fear you. The employees I have had that were more concerned about appeasing my wrath, did what I wanted, when I wanted as long as I was around. When I wasn’t there, they either used it as an excuse to do nothing, or were so in fear that what they did would dissatisfy me, they did very little. The employees who cared about me as a person, not just as their boss, wanted to do things that made me look good to others. They generally took this approach without supervision. They took the time to understand what was right and worked hard to do it. They made mistakes, but they learned…… the other group…made mistakes but never learned because their only real motivation was to keep me off their back……

Why would my employees care about me? Simple, I cared about them first. I wanted to see them get ahead. I wanted to see them become more valuable, either at their current job, if possible, or at another company if it was the only way. Most managers found this counter-intuitive. Why would I build up an employee just so they would go to work elsewhere?

Several reasons… Who wants an employee that doesn’t want to improve their value? Is it just a job, or a profession? They may not want a promotion, but they surely want to work smarter not harder….. An employee who feels they are acquiring a skill that will eventually make them more valuable will work harder and for less pay. They will see it as “Paying Tuition” for an education that will pay dividends down the road. If they are the right employee, they will know if the company has an opportunity for them to advance. If they know there is no real opportunity where they are, then they will sneak around to get the skill because they will be concerned their current employer will sack them if they find out. You have to get that off the table. If they are good and there is no growth opportunity where they are, they are going to leave. You can’t stop that. You should be concerned with what they are willing to achieve while they are at their current job. Be open and honest about their career path. Care about them first. Help them get to where they want to be.

What if they are not the right employee? That is, they have no desire to improve their value. They don’t care if you care about them, because they really don’t care about themselves. There is no point in micromanaging them, or being authoritative in your approach. This is a short-term solution, which enables a counterproductive behavior. Let’s face it, these people are gone, it’s just a matter of when. Don’t argue or fight with them. Don’t get frustrated. Replace them as soon as you can. Replacing an employee is an easy task that just takes planning. After several attempts to get them to take an interest in themselves, put them on a specific performance improvement program (PIP) with deliverables and target dates. Make it objective so there is no wiggle room. They hit the targets or they don’t. The PIP should clearly state the actions to be taken if they don’t make the targets.

If you take this approach a couple of other things will happen… the good employees won’t tolerate the poor employees and want them off the team…. Prospective new employees will want to work for you not just because of the opportunity at hand, but because they will have heard that you will help them enhance their careers. You get and keep better employees.

The micromanagement authoritarian approach gets you sleepless nights, pent up frustration, unresolved anger and poor results. The control freaks out there…. A big part of the fear of losing control is believing that no one has your back. You tell yourself that you are the only one who cares enough and is smart enough to get the job done. And if the job doesn’t get done you’re the one that suffers… Get professional help…. you may have just built your own dilemma by the way you manage others… they don’t care about you and want to see you fail…. You’re not paranoid…..

Here are great follow-up articles to read….

Forbes Hire for Attitude

Harvard Business Review


Wednesday, August 17, 2011

Businesses should Become Profitable Before they Become Big

Great article concerning the pit falls of creative accounting. Groupon reported earnings of $80M when they actually lost $114M.

Groupon Doomed by Too Much of a Good Thing

Clayton Christensen would agree with the intuition that Groupon displays but ignores: businesses should become profitable before they become big. The best way to manage a fledgling business is for managers to be impatient for profit but patient for growth. Such a strategy limits an early venture's funding in order to force the business to develop a profitable business model and then invests heavily in growth once such a model is identified — Christensen terms such investments "good money" for incubating growth businesses and extols the strategy for three reasons.

  • First, when a business is impatient for profit, managers are forced to validate their assumptions and demonstrate that customers are fundamentally willing to pay an acceptable price for the company's offering.
  • Secondly, expecting a business to be profitable quickly forces it to keep its fixed costs low. Because a business's cost structure determines which customers it finds profitable, keeping these fixed costs low preserves strategic options for the company when it is choosing which customers to target.
  • Finally, reaching profitability quickly ensures that when outside financing dries up, the venture can succeed on its own.

We are so all consumed by winning that we lose sight of what score keeping is about. It’s about showing position and progress. It is not about the score, but what the score tells us. If things are not going as well as we would like or if we know according to the Sigmoid Curve that they will get worse before they get better, wouldn’t we want to know exactly what our position is? Wouldn’t we want to know as factually as possible the levers that we can push and pull to make things better?

I talk with many small businesses that I know will never achieve the level of success they should because of the way they keep score. In some cases it not just the way they keep score, they haven’t developed the skill to know what the score is telling them. They are too busy trying to look successful by redefining success.

Don’t fit the score keeping to your desired results…. Drive the desired result with better score keeping…