Can we learn any lessons from the Penn State scandal in managing our own business?

This past week, Happy Valley celebrated the life achievements of the one person responsible for the most successful major college football program in the county. By now, everyone knows the story of the downfall and has an opinion on the supposed mistakes that were made in State College. During the memorial service, no one wanted to discuss the Elephant in the 12,000 seat arena that houses the basketball team. No one dared touch the subject, except for the final speaker. Phil Knight, Co-founder of Nike understood the elephant and approached it head on. “If there is a villain in this tragedy,” said Knight, “it lies in that investigation, and not in Joe Paterno’s response.”
Hopefully your organization never has to deal with anything as tragic as the accusations in State College, but can we learn lessons on a much smaller scale in our own companies? Mistakes will be made in every organization; some big, some small. Problems will arise all of the time, typically because someone made a mistake. The question is, do we acknowledge the mistakes or let them slide? Do we solve a problem immediately or let it fester? Do we make difficult decisions and communicate those decisions effectively or hope the problem will go away? These are decisions that business leaders must wrestle with consistently. These are the same decisions that Penn State leaders faced more than ten years ago.
It is important to recognize that the institution is bigger than any one individual. However when the leadership team is more concerned with protecting its image than correcting the error, they are compounding the problem. When Penn State officials failed to report the crimes to the proper authorities, they neglected to solve the issue and in essence were hoping it would just go away.
When a mistake occurs, management must react immediately, and the subsequent problem needs to be resolved. True leaders need to make unpopular decisions that may put their own reputations, and their positions of power, at risk. When they do, the message they must deliver in response to the crisis can be even more difficult to communicate. But it is that personal courage and integrity that a leader must demonstrate when a crisis arises. If he or she does so, the organization, and all of the people affected by the crisis, will ultimately be better for it. No one really enjoys dealing with mistakes and the predicament they create, but remember, problems are not like fine wine, they do not get better with time. Unfortunately, Penn State found this out the hard way.

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Developing True Consistent Leaders

So often I am approached with the question, “So you were a college coach… that must have been so exciting?” Or what was it like to coach in the NCAA Tournament against Coach K or Jay Wright? Sometimes the conversation develops to the point where I am asked, “What is the biggest challenge in coaching college basketball?” While the first few questions always bring back fond memories, the last one reminds me of the toughest challenge every season, developing true consistent leaders.

We always had bright young men who were excited to be attending a university and playing Division I college basketball. Each one was accustomed to being the best player their whole lives until they arrived to college and recognized that everyone else is just as good as they are, if not better. Adversity was not something they had to deal with very often. They were used to everything coming easy to them and they never had to work very hard for success. In fact, success usually came instantly. So logically, everyone from their high school or hometown labeled them the natural leader, the captain of the high school championship team.

Most people only get to see the glamour and not all the work that goes on behind the scenes. They only remember the championship games and cutting down the nets. Nets would never have been cut down if we didn’t have great leaders who led us through the challenging parts of the season. For example, how did each player handle the time our starting point guard was out for 9 games? How did they withstand that 3 game losing streak? When adversity hit our team, we would discover who are leaders were. They revealed themselves consistently in the good times and the bad. They didn’t choose to become leaders because they wanted to be popular. They chose to become leaders because the cause was worth it. The cause was greater than self- gratification and they sacrificed their own agenda, for the greater good of the team.

We live in a world where people are concerned with, “What’s in it for me?” Consistent leaders always have complete focus on the greater cause. They are then able to influence the rest of the team to do the same. All groups bear the same struggles and the business environment is no exception. Our greatest hurdle in running our business is getting complete buy in from our employees. In order for us to run the business at a championship level, we need to create a culture where everyone operates from a team perspective. That is what wins championships! That is what wins business!

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Is your workplace civil?

Is your workplace civil?

I am pretty sure that you are nodding your head to that question. After all, you are civil – polite, cooperative, a team player. Willing to share your expertise. Friendly to coworkers. You hold the door for people entering behind you. You clean up after yourself in the company kitchen. And you assume that everyone else in the company does the same.

But do you really know? There are so many things vying for your attention – and they all take priority over wandering around your workplace looking for signs of civility among your teams. And typically, your interactions with employees and colleagues focus on business issues. Not to mention that newer employees, younger employees, junior-level employees, may not feel free to bring up issues related to incivility in the workplace, particularly when the incivility is because of behavior by more senior level colleagues.

Perhaps you are not sure what defines civil behavior, or its’ absence. It can take many forms, from speaking loudly in a cubicle-filled space, to cell phone ring tones in the office, to stealing food from the common refrigerator, to playing the radio in a shared office space. One example follows:

A senior manager, who reports directly to the CEO, has a large department of employees who track massive amounts of data. Most of his team sit silently in their cubicles all day long crunching numbers. But the manager, a friendly man with a loud, boisterous style, sits in his office with the door open and spends much of each day on conference calls. He uses a speakerphone, and the result is that most of his meetings and calls can be heard by almost everyone within at least 30 feet. When he does desire a private conversation, he gets up and quickly slams the door, which is always startling, and futile, as his loud voice carries through the door. While it is clear that he is completely unaware of how distracting and rude this behavior is, it is nevertheless behavior that is inappropriate for the workplace and should be stopped. But no one has the nerve to discuss it with him directly, nor to bring it up to the CEO. In this case, one solution is for a peer to approach the offending manager and tell him what he sounds like from the cubicles, perhaps even quote a conversation he overheard. Alternatively, top leadership, working with the Human Resources department, could implement a campaign for a civil work environment, posting notices, providing training, and enabling an environment where employees feel safe to discuss when the workplace behavior of others is a problem.

Incivility is detrimental to your employees and your company in many ways. Employees feel powerless to change their environment or to escape the offending behavior. They may feel intimidated. They may feel that management is not paying sufficient attention to the workplace environment. Or worse – that management knows about the offending behavior but just doesn’t care. Not to mention the distraction that results in lost productivity. Think about it – how productive would you be if you had to listen to almost every conversation your boss has during the day, including some that he surely means to be confidential? Or to endure a constant stream of inflammatory talk from someone’s radio playing talk radio all day on the desk next to yours? The stress and tension of working in such environments is enormous.

Promoting a more civil workplace can have a major positive impact for your employees at little or no cost to you. All you really need to do is pay attention to what is going on in your offices, promote an environment where all employees feel safe discussing workplace behavior that negatively impacts them, be willing to take corrective steps as necessary, and set a good example yourself. The likely result will be happier and more engaged employees who will be truly appreciative of the improved environment.

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The toughest of elephants — change at the top

I wondered if we were going to be able to talk about the problem everyone knew faced us, but no one wanted to mention.  Then, one of the members of the leadership team looked at me and said: “We have an elephant in the room, and we better deal with it.”   I wanted to give him a high five on the spot.  He had the courage to acknowledge that he and his colleagues, who run their company, had a serious problem they had to face head on.

An “elephant in the room”, a really intimidating problem you would rather not talk about, can kill a business if it just sits there, unmentioned and unaddressed.  It takes courage on the part of a leadership team to state the problem clearly, discuss it openly, and then solve it.  Face the elephant, and chase it out of the room, and you can really strengthen your business, and build tremendous trust and health on your team.

And they did it – as tough as the issue was.  They faced the fact that a member of their leadership team, who had been with them for some time, no longer fit in the culture they are striving to build.  They had committed to each other and their fellow employees that they would grow their business aggressively, and they knew it would require them to change their behavior with their customers and their fellow employees.  In their market (an intensely competitive one), the team realized they had to listen much more effectively, respond faster, and get everyone in the company involved in creating new services that would differentiate them.

They knew that their colleague had no intention of abandoning his long established management style, which was more directive and less collaborative.  He was comfortable with his style—it had been his key to success for years as he had helped drive the company to its current level.

By deciding to face the “elephant in the room” head on, my friends opened the door to a fundamental change in their colleague’s role.  They had the courage to talk with him about the disconnect between his leadership style and the culture they are striving to build.  After a very tough discussion over several weeks, he agreed to step out of his leadership role and focus on a key project where his skills are a great fit.  I admire their candor and courage in facing their elephant, and their compassion in helping him define a role that will work well for him and for the company.   And I admire his willingness to change his role to help the company grow.

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Are You Half Full?

Now that the lazy days of summer have come to an end I see some people exuding a rather melancholy state of mind.  Whether it’s the start of school with the busy schedules it includes, the shorter daylight hours and the prospect of long, cold winter nights, or the thought of a stretch of many months before the next vacation, many people just appear down.  It’s a phenomenon I see year after year.

On the opposite end of the spectrum I see many individuals excited and energized by the change of season.  They see it as a fresh start, a time to rev up and get into gear.  They embrace the idea of waking up from the summer slumber and returning to the hectic pace of regular life.

What is it that influences these emotions, and why are they so different from one another?  I suspect it has a lot to do with their general outlook on life.  As the old saying goes, “Are you a glass half full or glass half empty type of person?”  In the business world how you answer that question may be the difference between success and failure.  In Jim Collins’ book Good to Great he writes, “Every good-to-great company embraced what we came to call the Stockdale Paradox:  You must maintain unwavering faith that you can and will prevail in the end regardless of the difficulties…”  Although this type of positive attitude does not guarantee success it does model optimism for success.  Employees want to follow a leader who believe in his or her business.  If you’ve ever worked for someone of the doom and gloom mentality you understand what I mean.  It’s quite difficult to stay motivated in that environment.

However, when it come to business, maintaining a glass half full perspective doesn’t just happen.  Good leaders feel optimistic because they’ve done their homework.  They build that perspective on the following premise:

  • They are confident in their business plan
  • They are executing that plan effectively
  • They have the right people in the right seats of their organization
  • They are operating within the company’s core focus and core values
  • They can access the company data and use it to keep a pulse on their business
  • They identify and promptly resolve the company issues
  • They have documented processes that are followed by all

In other words they do the ground work to allow the optimism to shine through.  One tool we at Makarios Consulting have found to be particularly effective in accomplishing this is the Entrepreneurial Operating System (EOS).  We have used this well organized, common sense system with many of our clients to help them gain traction, achieve great results AND stay half full.

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Challenging the Status Quo

Process. Routine. Habit. Status quo. When a true leader hears the words, “We’ve always done it this way,” his or her fingers start to itch.

The questions come fast and furious:
“Why have we always done it this way?”
“What’s working in our process – and what’s not?”
“How can we do it better?”

Great leaders consistently seek out new and innovative ways to accomplish work. They push the envelope in their undying quest for continuous improvement, living by the adage, “If it’s not broke, break it!”

Is this an extreme position? Yes, it is. In a world where people habitually resist change, true leaders seek change out and welcome it. They affirm that no matter how poorly a system is working now, it can be turned around to become a streamlined, profit-making machine. And, they recognize that no matter how well a system is functioning, it can always be made better, leaner, faster and more profitable.

Here are three ways great leaders effect real change:

Make adjustments gradually, when appropriate. You can change a car’s direction by spinning the wheel in a violent 180-degree turn, or you can take your time and swing around in a gradual circle. Gradual changes are usually easier on people, simpler to put into action, and more effective in the long-run.

Create small wins. If entire processes, practices, or organizational structures need to be overhauled, be sure to create small wins along the way to encourage employee motivation, keep people on target, and provide a sense of accomplishment.

Learn through mistakes. Remember that not every idea, plan, or change initiative will be successful. Mistakes will be made. Failures will happen. When that is the case, view mistakes as opportunities for learning and not as reasons for blaming or bludgeoning people. The question is not “Who screwed up?” but “What can we learn?” In this atmosphere, mistakes and failures become the keys to success, because people at every level of the organization are confident that they can seek for improvements without putting themselves in personal jeopardy – even if their efforts are not successful.

As a leader, never settle for the status quo. Never hesitate to break new ground. The best is just a little beyond where you are now. You can get there – it just takes the courage to challenge, and to change.

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Did He Really Say THAT?

Did He Really Say THAT?

I attended a professional meeting recently. The audience consisted of Human Resource professionals, most of them in their 40s and 50s. The guest speaker was a bit younger. He was speaking on the subject of succession planning. He had some good ideas and made some interesting points. But no one at the meeting remembers them. This is what we remember him saying:

“How many of you have difficulty filling key roles? Who is hesitant to promote deserving employees because there is no one to replace them? Well, the reason you are having difficulty is this: You are looking in the wrong places. You are probably looking at candidates who are unemployed and actively searching for jobs. These are not good candidates – if they are not working, there must be a reason. And if they are working but looking for another position, that probably means that they are not considered to be “stars” at their current organization. And if they are Baby Boomers, they probably don’t have the energy and technical expertise necessary to stay ahead of the younger generations of employees. Baby Boomers are just not cutting-edge candidates for promotion.”

What? Members of the audience started glancing at each other, not really believing what they were hearing. A few whispered among themselves. Some probably even tweeted that they couldn’t believe their ears… And, of course, once he had put that message out there, the rest of his message was just “bla bla bla…”. But, as they were a polite group, they let him finish his presentation.

OK, maybe, as HR professionals, they were overly sensitive to the political incorrectness of his statements. And maybe the members of the audience who are in transition (this is the current term for people who are un- or under-employed) felt personally insulted. And maybe the Baby Boomers felt slammed at the implication that they were too old to be promoted. And you know what – they had every right to be! The speaker didn’t have a clue as to who his audience was. He certainly didn’t take the time to look at them and then to communicate his points in a way that would be well-received by his listeners.

Why is it so hard for most people to assess their audience and adjust their words accordingly? Why do so many people enter an interaction intent on getting their point across, only to come away disappointed? How many arguments occur because people fail to pay attention to how they are communicating their perspective to others? If people took a minute to consider if their personal opinions are distorting the clarity of their communications, they probably would quickly draft more effective and productive communications. Or if they stopped to review the vague words, jargon, or overly complex nature of their communications, they might opt for being simple, straightforward and specific. By attending to the specifics of communication, the speaker is more likely to actually be heard and understood by his listeners.

And why is it so hard for some people to view those in transition, and those actively seeking new opportunities, as a valuable pool of readily available talent? People become unemployed for many reasons, particularly in the current economic era. Many of them are eager to apply their experience and intelligence in a new position and organization. This may be particularly true of Baby Boomers (whether employed or unemployed), who typically hold significant business and social wisdom, as well as interpersonal skills that can only be gained through years of experience.

As to this particular speaker: After his speech, a member of the audience took him aside and told him how insulting his words were. And of course, he didn’t intend for that to happen. I bet he is much more careful in the future

And it’s a good thing he left before I got to speak with him. I would have told him that not only are most Baby Boomers the source of significant business and life wisdom, but we are pretty damn cool, too!

Maybe I’ll Facebook him about it!

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State Your Niche

While driving through the state border between Pennsylvania and Delaware I noticed something interesting.  On the sign welcoming travelers to Delaware there are a number of what I would call catch phrases describing the tiny State.  I assume they are there to invite tourism and commerce.  On this one single sign I saw the following:  “The First State”, “Small Wonder”, and “Home of Tax Free Shopping”.

Being the curious type I started doing some research into what Delaware was really known for.  Apparently each state has a motto, nicknames, both official and non-official, and various slogans.  Here are Delaware’s:

Motto – “Liberty and Independence” – Um, didn’t see that on the sign.

Nicknames:  Official – “The First State” – I understand that.  Delaware was the first state to sign the constitution.

Nicknames: Un-official:

  • “The Diamond State” – Where are those diamonds?  If they’re here I haven’t found any.
  • “Uncle Sam’s Pocket Handkerchief” – I have no idea.
  • “The Peach State” – I thought that was Georgia.
  • “The Blue Hen State” – I’ve learned that there is a variety of fowl called a Blue Hen and it’s the mascot for the University of Delaware.
  • “The Chemical Capital” – Is that a good thing?

Slogans:

  • “Delaware: It’s Good Being First” – Okay.  Agreed.
  • “Smaller, Faster, Smarter” – The “Smaller” part I get.  I’m not so sure about “Faster”.  I live in “Lower, Slower Delaware” so faster really doesn’t apply.
  • “Delaware:  Wow… You’re in Delaware” – Duh!
  • “Delaware:  We Really Do Like the Chemicals in Our Water” – Really?
  • “Delaware:  First and Forgotten” – Now there’s a slogan to be proud of.
  • “Home of Tax Free Shopping” – I think we’re getting somewhere with this one.

All kidding aside, I question what the state of Delaware is all about.  Is it known for its history, its tax free shopping, or its lovely and pristine beaches, (which are nowhere to be found in its motto, nicknames, or slogans – maybe they want to keep them a secret)?  I don’t know about you, but looking through all of this I’m confused.  Why would someone want to visit this state?  What would draw one there?  What is its niche?

The same confusion exists in businesses that haven’t defined their niche, the thing that makes them stand out from the rest.  If your niche is not well defined, what would entice a customer to do business with you?  What makes you different from any other supplier of products or services in your industry?  Defining your niche is critical to your business success.  It allows your customer to have a laser focus on what you do best.  So state your niche and eliminate confusion.  By the way, does anyone know what the heck “Uncle Sam’s Pocket Handkerchief” means?

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The Cash Crunch — An Elephant in the Room

My friend looked at me with a smile and beamed about her business’s results for the past 6 months.  “Look at the turnaround,” she said.  “We are well into the black for the first time all year thanks to cost controls and our hard work to collect from our customers.”  She had every right to be proud…she had turned her business around by focusing on disciplined execution of her business plan.  But then I asked the question that changed her mood: “How’s your cash?”  She frowned, and admitted that “We don’t have much left, even after all that hard work.”

It’s one of those “Elephants in the Room” that plagues many businesses.  We define an “Elephant in the Room” as a tough business problem that a leadership team would rather not admit exists, or has a very hard time facing head on.  We see it all the time with companies we know.  They make tremendous progress in improving their business results by growing revenue, controlling costs, and bringing the business to profitability, but they still have little cash left to invest in growth – cash they would love to use for the development of new products or services, for marketing to attract new customers, and to reward their people for great work.

How does it happen?  Sometimes business owners don’t focus on their cash position with the same intensity that they bring to sales and product, or service, delivery.  Sometimes they choose to spend more than they should on a new initiative – one that they really cannot afford.  Often, they don’t stop to forecast the cash their business will need to pay their employees and their regular bills.  Simply put, they take their eye off cash and ignore the looming “Elephant” – a coming cash crunch that can starve their business.

What can you do if this is a problem for you?  Make cash your number one metric in the business.  Measure it every week, forecast your cash needs monthly—using a rolling 3-6 month forecast, and admit it when you really don’t have the cash you need to take on a new project, or hire a new member of your team.  When you are ready to spend some cash to grow, force yourself to make a conservative evaluation of the return that cash investment will bring.  Then, cut that anticipated return in half.  If it still looks like an attractive investment, spend the money.  If it does not, don’t.

Focusing on cash every day is an essential tool in improving your execution as a business leader.  Doing so will help you herd that “Elephant in the Room”—The Cash Crunch—out of your business.

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When is a weed really a weed?

Recently, on a beautiful spring day, I was visiting my daughter. I offered to give her some tips about sprucing up the yard of the home she rents. Now, I am no master gardener, but I have fought with weeds my entire life. I know weeds!

As we moved through her yard, I noted that she already had several nicely landscaped areas. She just needed to get rid of those weeds! So I started pointing, saying “That’s a weed, those are all weeds, that vine growing up that tree looks like poison ivy, those flowers don’t belong there…”

That final piece of advice confused her. “Those flowers are weeds?” So I explained that, even though they were attractive plants, they were in the wrong place – they didn’t add value where they were, they didn’t fit in that spot, and they should be pulled or transplanted to a more suitable location. And, sure enough, nearby was a grouping of flowers where the offending plants were perfectly suited.

So that got me thinking about how often good employees are viewed as poor performers or troublemakers simply because they are in the wrong job. Or on the wrong team. Rather than just terminating, or pushing such an employee to do the job better, doesn’t it make sense to assess the landscape, determine if the employee is truly a problem, or just in the wrong spot? If he has potential but is not well-suited for his current role, identify alternative roles where he can blossom. The result will typically be an engaged performer who understands his own role and is eager to contribute to group and company goals. With the added benefits of not having to outplace someone or source a new employee to fill a need.

Just like transplanting misplaced plants – they add value and benefit in the right location, without even having to go to the nursery. For more on this, go to

http://landscaping.about.com/od/flowersherbsgroundcover1/f/site_selection.htm

For more on getting employees in the optimal place, visit Makarios at

http://www.makariosconsulting.com/mc/index.html

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