How to Create a 100+ Year How to Create a 100+ Year CompanyCompany

OverviewOverview

• There are some timeless principles to building a great company. Apply these principles and you’ll get greatness.

• Greatness does not lie in accounting, cost cutting, or the pure profit motive. It lies in building a company’s sense of purpose around core values that give work meaning.

• There are principles that will guide you into building something bigger and more lasting than yourself. If you want to leave a legacy, this is what you must do.

• All this information is rooted in rigorous research.

• Why on earth settle for creating something mediocre that just makes money when you could create something that makes a lasting contribution as well. It takes the same amount of time and is more fun and rewarding. Those who create a lasting contribution make more money in the end as well!

Note These Points

• The Silicon Valley Paradigm of getting a good idea, raising venture capital, growing rapidly, and then selling out or going public … fosters impatience and a rise in social instability. Many of those “high tech” companies which were “built to flip” are dead.

• Success based on a great idea is like telling perfect time without a watch, whereas putting together and maintaining a company that succeeds over time is like building a clock that runs forever.

• A great company does not need charismatic leaders or fantastic product ideas. It needs a commitment to greatness and a process to get there. That’s what I’m trying to teach you.

• Do you build a product or a company? The constant stream of great products and services from highly visionary companies stems from them being outstanding organizations, not the other way around.

You Can Do ItYou Can Do It

You can improve your organization’s position, stature, performance … and perhaps even become “GREAT” … if you consciously apply the framework of ideas I show you. These are the “secrets to success” of the 100-year companies.

Characteristics of Great CompaniesCharacteristics of Great Companies

• Premier company in its industry

• Widely acknowledged as “the Best” by knowledgeable business people

• Makes a lasting impression on the world

• Lasts several generations

• Goes through multiple products and life cycles

Common MisconceptionsCommon Misconceptions

• You do not need a celebrity leader

• Executive pay does not correlate with going from being good to being great

• Strategy does not separate the good from great

• You must focus on what NOT TO DO as well as what TO DO

• Technology accelerates change but it does not cause a transformation of the company

• M&A play no role in igniting a company’s transformation to greatness

• Good-to-Great companies are not necessarily in great industries

10 Myths of Great Companies10 Myths of Great Companies

• You need a “great” idea to start• You need a “charismatic” leader• Their first objective is to maximize profits• You need a particular certain set of core values• Change is the only constant thing• You must “play it safe” and be risk adverse• They are a great place to work for “everyone”• Their best moves are made through “brilliant planning”• They should hire “outside CEOs” to bring about fundamental change• They focus on “beating the competition”

The Myth of Needing a Great IdeaThe Myth of Needing a Great Idea

• Be a Builder of a Clock (organization) that keeps running, rather than a genius perfect Time Teller

• Just Get started ... and find your way

• Business school teaches great idea, great marketing plan, window of opportunity - nope!

• The ultimate creation is the company, not the product or idea - so put your energies into trying to create an organization and design an environment conducive to great product creation (leaders die but great companies last)

• HP: urinal flusher, telescope clock drive, fat reduction shock machine, anything

• Sony: rice cooker, tape recorder (failed), heating pads

• HP’s creation wasn’t the calculator or oscilloscope but the company and HP way

• Masaru Ibuka’s greatest product was not the Walkman or Triniton but the Sony company and what it stands for

• Walt Disney’s greatest creation was not any one movie but the ability to make people happy

• etc.

Examples ...

The Myth of the Charismatic LeaderThe Myth of the Charismatic Leader

• The great leader theory does not explain the difference between good and great companies

• 3M, P&G, Sony, Boeing, HP, Merck, …

• The continuity of great leadership comes from great organizations

• Great leaders are architects and clock builders, and give their associates a chance to make a name for themselves and show what they can do - fanatically driven to produce sustained results and workmanlike diligence

• American Constitution - Thomas Jefferson, James Madison and John Adams were organizational visionaries; same for the lawgivers of Athens and Sparta

Great Leaders = Professional Will + Great Leaders = Professional Will + Personal HumilityPersonal Humility

• They transform personal ambition into ambition for the company

• They are ordinary people producing extraordinary, superb results; have a dedication to making anything they touch the best it can be … yet are humble and modest, never boastful

• Demonstrate unwavering resolve to do whatever must be done, no matter how difficult, to produce best long term results … but act with quiet, calm determination and motivate through inspired standards rather than charisma

• Their goal is to build an enduring great company … they channel ambition into the company & not the self, and set up the next generation to succeed even more than they did

• They look in the mirror for blame (never others or bad luck or the environment) … and give the credit for success to others

Having the Right PeopleHaving the Right People

• Great Leader:– First WHO - get the right people, build the right team

(the right people do the right things and best results regardless of the incentive system)

– Then WHAT - with the right people, figure out the path to greatness

• “Genius with 1,000 Helpers”– First WHAT - set a vision and road map

– Then WHO - enlist a crew of “helpers” to make it happen

The “Genius with 1000 Helpers”

• The myth of individual genius is destructive … we think we have to do all the hard work ourselves

• The most successful people rely on the help of other people

• Surveys show partnerships do better than single ownership (2X survival rate, grow faster, higher profits/person, last longer)

• If “2 heads are better than one,” 3 heads …

• A partnership is like a marriage without sex, so choose your partners as you would evaluate a wife

Selecting People - get the Gene Pool Selecting People - get the Gene Pool RightRight

• Rule 1: when in doubt , don’t hire but keep looking– you cannot grow revenues faster than your ability to get good people to

implement that growth and maintain company greatness

• Rule 2: when you need to make a people change, do it !– If you feel you need to tightly manage someone, you know you hired the wrong

person!

– If it were a hiring decision, would you hire them again?

– If they tell you they are leaving, would you feel disappointed or relieved?

• Rule 3: put your best people on your best opportunities, not your biggest problems

• Rule 4: people are not your most important asset, the “right” people are your most important asset, and right often has to do with character

You Can Balance OppositesYou Can Balance Opposites

• Purpose beyond profits• Fixed core ideology• Conservatism around the core• Clear vision/sense of direction• BIG GOALS• Managers steeped in the core• Ideological control• Tight culture (cult-like)• Long term investment• Visionary, futuristic• Organization aligned with a core

ideology

• Pragmatic pursuit of profits• Vigorous change and movement• Bold, risky moves• Groping and experimentation• Incremental evolutionary progress• Managers that induce change• Operational autonomy• Ability to change and adapt• Short term performance demands• Super daily execution• Organization adapted to its

environment

Hedgehog ConceptHedgehog ConceptThe fox knows many things, but the hedgehog knows one big

thing.• Don’t be scattered, diffused, moving on many levels• Those making the biggest impact (Freud, Einstein, Marx,

Adam Smith) concentrated on one thing and simplified it

• 3 Things:– Best in the world at: “I feel I was born to be doing this”

– Economic Engine: “I get paid to do this? I am dreaming!”

– Passion: “I look forward to getting up and going to work and really believe in what I’m doing”

The Hedgehog ConceptThe Hedgehog Concept

• What can you be the best in the world at? (otherwise you can be successful but not great) Stick to it. Doing what you are good at will only make you good but focusing on what you can potentially do better than any others --> you’ll become great.

• What drives your economic engine? Profit-per-x, cash flow and profitability ... What one ratio do you systematically want to increase over time to have the greatest impact on your economics? Find a metric.

• What are you deeply passionate about?

Nucor Steel is an Example of the Nucor Steel is an Example of the Hedgehog ConceptHedgehog Concept

• Economic denominator - profit per ton of steel

• Become the best in the world at harnessing culture and technology to produce low cost steel

• Passion for eliminating class distinctions and aligning management and workers

Examples of Economic DenominatorsExamples of Economic Denominators

• Abbott: profit/product --> profit/employee

• Fannie Mae: profit/mortgage -> profit/mortgage risk level

• Gillette: profit/division -> profit/customer

• Nucor Steel: profit/division -> profit/ton of steel

• Philip Morris: profit/sales region -> profit/brand

• Walgreens: profit/store -> profit/customer visit

• Wells Fargo: profit/loan -> profit/employee

Culture of DisciplineCulture of Discipline• The purpose of bureaucracy is to compensate for incompetence and lack of

discipline, but these problems go away if you have the right people in the first place

• Most companies build bureaucratic rules to manage the small percentage of wrong people, which drive away the good people

• REMEDY: create a culture of discipline– responsibility accounting

– freedom and responsibility within a framework

– fill that culture with self-disciplined people willing to go extreme lengths to fulfill their responsibilities

– don’t confuse discipline with tyrannical disciplinarianism

– adhere with consistency to the Hedgehog Concept

– a culture of discipline, not discipline through sheer force

You Can’t Fix What’s Broken With Good Policies

• Fixing problems with policies sometimes works, and sometimes creates lots of conflicting policies

• When a problem arises, instead of a new policy try this:– Contact the source of the reported problem and get some idea of the

evidence there is a problem

– If the evidence is legitimate, contact the person responsible for solving the problem and ask them if they know about it, and how much they know

– Then ask them to “copy” you their solution (resist the urge to suggest a solution or create a new policy) which ensures that the problem gets solved, the solution makes sense, and it makes sense in the context of the whole business and its operations

• This approach recognizes that good employees don’t need policies to do good work, and bad employees will waste time and screw things up no matter what policies you write

Culture of DisciplineCulture of Discipline• You want to create a culture full of self-disciplined people who take consistent action

consistent with the 3 Hedgehog principles

• If you get the right people --> you don’t need bureaucracy

• People adhere to a consistent system; people have freedom and responsibility within that system

• It’s Not about Action -- Get disciplined people who engage in disciplined thought and then take disciplined action

• Great companies appear boring from the outside, but inside they’re full of people with intensity and diligence

• The more you stay within the 3 principles, the more will be your opportunities for growth

• Once-in-a-lifetime opportunities are irrelevant unless they fit within the perimeter of the three principles

• Stop doing lists are more important than To Do lists

You Need a CouncilYou Need a Council

• Purpose: Understand issues facing an organization

• Meeting every week or two (ex. meet for lunch twice a week), thisCouncil provides a small team of people in the firm sufficient "jawbone" or talk time to dialogue about the direction, priorities, and challenges of moving the business forward.  Without this informal talk time, it's hard to figure out the important stuff.

• Argue, debate in search of understanding, not ego• Members must have different perspectives• The council is a standing body• Mentors and the Board of Directors are similar but not the same• Final responsibility rests with leader, not consensus (since consensus

decisions are often not intelligent)

Great Companies Focus on More than Just ProfitsGreat Companies Focus on More than Just Profits

• Merck - free river blindness medicine, streptomycin after WWI to Japan to eliminate tuberculosis: “We try never to forget that medicine is for the people. It is not for the profits. The profits follow, and if we have remembered that, they have never failed to appear. The better we have remembered it, the larger they have been.”

• Ford - criticized for injecting spiritual principles into business (go after reasonable profit, enable lots of people to enjoy a car, twice industry pay rate)

• Profitability is necessary, but only a means to a more important end; oxygen is important for life, but not the point of life, but without it there is no life.

• Like-minded people come together for the same core ideology

• HP - bigger was better only if it made a contribution• Johnson&Johnson - to alleviate pain and disease• Boeing - to pioneer aviation• Find the RIGHT PRAGMATIC SOLUTION in line with their CORE IDEALS

Core Ideologies - There is No “Right” OneCore Ideologies - There is No “Right” One

• Customers - Johnson&Johnson and Wal-Mart (Sony and Ford - no)

• Concern for Employees - HP and Marriott (Disney and Nordstrom - no)

• Products and Services - Disney and Ford (IBM, Citibank - no)

• Risk Taking - Sony and Boeing (HP and Nordstrom - no)

• Innovation - 3M and Motorola (P&G, American Express - no)

• The critical issue is not whether a company has the “right” core ideology, but whether it has a core ideology that gives guidance and inspiration to people inside that company!

A Core Ideology A Core Ideology MustMust Permeate the Company Permeate the Company

• To create a great company, you need a core ideology

• Indoctrinate employees around the core ideology -- you want to create a cult like following

• Select the company’s senior management based on their skill and their fit with that core ideology

• Align your goals, strategy, tactics and organizational design around that ideology

Core Ideology = Core Values + Purpose

• Core ValuesCore Values = a small set of enduring guiding principles you never compromise for financial gain or short term expediency

• PurposePurpose = a fundamental reason for existence beyond just making money that always guides the firm

Examples of Core PurposesExamples of Core Purposes

• Israel - to provide a secure place on Earth for the Jewish people

• Walt Disney - to make people happy

• Sony - to experience the joy of advancing and applying technology for the benefit of the public

• Merck - to preserve and improve human life

• HP (Hewlett-Packard) - to make technical contributions for the advancement and welfare of humanity

• Cargill - to improve the standard of living around the world

• 3M - to solve unsolved problems innovatively

Preserve the Core But Go for ProgressPreserve the Core But Go for Progress Core Big Goals

Be pioneers in aviation BOEING Bet the house on the 747, 707, B-17

Seek superiority in all undertakings; make customers happy

IBM Commit $5 billion gamble on the 360

Tap the “creative power within”, continuous improvement

MOTOROLA Find a way to sell 100,000 TVs at $179.95; attain six-sigma

Elevation of Japanese culture and national status; do the impossible

SONY Change the worldwide image of Japanese products

Bring happiness to millions DISNEY Build Disneyland to our image

Preserve and improve human life; medicine is for people not profits

MERCK Become the #1 drug maker worldwide via massive R&D and new drugs that cure disease

Preserve the Core But Push for ProgressPreserve the Core But Push for Progress

A company must be willing to change everything about itself (tactics, strategies, costs, products) except its basic beliefs or philosophy of doing businessEx. IBM - blue suits, white shirts, IBM360 … all gone

• 5 Strategies– BIG goals: challenging, visionary projects that stimulate progress

– Cult-like Cultures: great to work there if you fit in

– Try a lot of stuff and Keep what works: experiment/failure OK

– Home grown management: promote from within

– Constant self-improvement: it’s never good enough

6 Big Factors6 Big Factors

• Special Leadership - quiet, unassuming, no self-importance, humility but intense professional will

• First Who …Then What - get the right people, get rid of the wrong people, put the right people in the right spots

• Confront the Brutal Facts But Never Lose Faith - Stockdale Paradox

• The Hedgehog Concept - what you can be the best in the world at + what you are deeply passionate about + what drives your economic engine

• A Culture of Discipline - with disciplined people, you don’t need a bureaucracy

Confront the Brutal FactsConfront the Brutal FactsPeople will filter the brutal facts from you -- “Yes” men

You need to Create a climate where people can be heard and the truth is heard:

1) Lead with Questions, not answers

2) Argue, Debate, Dialogue over strategy and what’s best for the company - evolve over agonizing arguments

3) Conduct autopsies without blame, don’t hide errors

4) Build “red flag” mechanisms

Victims - either permanently dispirited, get their life back to normal, use it to define themselves

Stockdale Paradox - not optimism

BIG GoalsBIG Goals

• A goal that grabs people in the gut and gets juices flowing, a big finish line so clear that it doesn’t need to be explained; Kennedy “go to the moon”

• “This is unreasonable” but we think we can do it; a goal outside the comfort zone

• Self-confidence bordering on arrogance

• The goal is important, not the leader (otherwise after the leader there is a stall), and it should be bold and exciting by itself

• The goal should be consistent with the core ideology

• Have follow-up BIG goals (so no “we’ve arrived”)

Cult-like CulturesCult-like Cultures

If you’re not willing to enthusiastically adopt the HP way, you don’t belong there; if don’t believe in wholesomeness, aren’t clean cut and believe in magic, you don’t belong at Disney; if you don’t want to join the quality push at Motorola, you don’t belong there; if you question the right of individuals to make their own decision, then you don’t belong at Philip Morris.

Characteristics of CultsCharacteristics of Cults

• Fervently held ideology

• Indoctrination

• Tightness of fit

• Elitism

Companies screen out those who don’t fit in with their ideology and create heroic mythologies about individuals who exemplify the corporate ideology

How to Establish the Cult-Like MentalityHow to Establish the Cult-Like Mentality

• Training programs with company values

• internal universities and training centers

• on-the-job socialization

• exposure to persuasive mythology of “heroic deeds”

• constant emphasis on corporate values

• tight screening process

• incentive/advancement programs that fit in with the core

• awards, contests, public recognition to reward those who display great effort consistent with the core

• tolerance for honest mistakes that don’t breach the core

• celebrations that enforce success

Try a Lot of Stuff and Keep What WorksTry a Lot of Stuff and Keep What Works

• Test, test, test, test, test - fail and fail FAST - give it a try and fast

• Accept that mistakes will be made: Darwin: multiply, let the weak die and the strongest survive

• Corporations are evolving species, no one gets 100% on every test - species evolve (no final blueprint) - use evolution to get to the top

• Try lots of different approaches and stumble upon something that works

• Small opportunities, incremental mutations grow into major unanticipated strategic shifts

• No decision is sacred

• Give people the room they need & allow people to be persistent• Build the ticking clock

Home Grown ManagementHome Grown Management

• It is not the quality of leadership that separates the visionary companies from the comparison companies. It is the continuity of quality leadership that matters--continuity that preserves the core.

• The key is to develop and promote insiders who are highly capable of stimulating healthy change and progress while preserving the core. Give them responsibility and training.

Good is Never EnoughGood is Never Enough

• How can we do better tomorrow than we did today?• Great companies don’t achieve their position because they have

superior insight or special secrets, but because they are so DEMANDING of themselves

• Continuous improvement is an institutionalized habit, a disciplined way of life

• Self-improvement includes: process improvement, long term investments for the future, investing in employee training, adopting new technologies

• P&G method - to make sure the company didn’t become fat, happy and complacent, it created a system of internal competition of brand management - it instituted discomfort mechanisms

• Merck: consciously yield market share as products became low-margin commodities, forcing it to create new products to grow and prosper

• Motorola: innovate or die mechanism similar to Merck• GE: internal discomfort instituted through special employee meetings

where managers cannot participate but must make decisions on the spot• Boeing: “eyes of the enemy” - managers assigned to develop strategy

as if they worked for a competing company• Wal-Mart: beat yesterday strategy• Nordstrom: sales per hour rankings that rate you against your peers;

no absolute standards that allow you to relax• HP: refused to take on long term debt forces company to learn how to

internally fund its growth rate

Alignment to the Total PictureAlignment to the Total Picture

• There’s no one single program, strategy or tactic -- it’s a complete system of everything interpenetrating

• Focus on small stuff, not just the big picture; day-to-day is the small stuff

• Cluster your mechanisms: Ford quality control + employee involvement programs + mgmt training programs + promotion based on management skills; Merck hires top scientists + allow them to publish + allow them to collaborate with outsiders + dual track

• Get rid of mis-alignments: your incentive system should reward behaviors in line with your core values, goals and strategies should align with your core values

• Keep the core while inventing new methods

Core IdeologyCore Ideology

• Leaders die, products become obsolete, markets change, new technologies emerge, management fads come and go, but core ideology endures as a source of guidance and of inspiration

• Core ideology is the bonding glue that holds an organization together as it grows, decentralizes, diversifies, expands

Core ValuesCore Values• The organizations enduring guiding tenets--a small set of

timeless guiding principles that require no external justification; they have intrinsic value and importance to those inside the organization

• Finding core values– If the circumstances changed and penalized us for holding this core value, would

we change it?– Imagine you have to duplicate the best attributes of your organization on another

planet but can only send 5 people--who are the best exemplars of your company’s core values (your genetic code)--ask them to elucidate it

• A clear ideology attracts people to the company whose personal values are compatible with company core values

Great ManagersGreat Managers

Test Yourself Against the Best Managers

1. As a manager, would you rather have an independent aggressive person who produced $1 million in sales, or a a congenial team player who produced half as much. Explain your reasoning.

2. You have an extremely productive employee who consistently fouls up the paperwork. How would you work with this person to help him/her become more productive?

3. You have two managers. One has the best talent for management you have ever seen. The other is mediocre. There are two openings available. The first is a high-performing territory and the second is a territory that is struggling.Neither territory has reached its potential. Where would you recommend the excellent manager be placed? Why?

Ask the Employees: These 12 Questions Measure the Fundamental Strength of the

Workplace

1. Do I know what is expected of me at work?

2. Do I have the right materials and equipment I need to do my work right?

3. At work,do I have the opportunity to do what I do best every day?

4. In the last 7 days, have I received recognition or praise for doing good work?

5. Does my supervisor,or someone at work, seem to care about me as a person?

6. Is there someone at work who cares about my development?

7. At work, do my opinions seem to count?

8. Does the mission (purpose) of my company make me feel my job is important?

9. Are my co-workers committed to doing quality work?

10. Do I have a best friend at work?

11. In the last 6 months, has someone at work talked to me about my progress?

12. This last year, have I had opportunities at work to learn and grow?

• People join companies for various reasons, but [1] how long they stay and [2] their productivity (how productive they are) is determined by their relationship with their immediate supervisor. It’s better to work for a great manager in a lousy company than a terrible manager in a great company.

Great Managers Know the Great Managers Know the Following SecretFollowing Secret

People do not change very much. They resist change.

So don’t waste time trying to put into them what’s left out of their character.

Try to draw out of them what is already inside them.

That’s a hard enough job just by itself.

Story of the frog and the scorpion crossing the river. “I can’t help it … it’s my nature.”

A Great Manager Should Do 4 Activities Extremely Well

(1) select a person

(2) set expectations

(3) motivate the person

(4) develop the person

A manager’s function is to act as a catalyst that speeds up the reaction that

creates the desired end product. The catalyst role has 4 main activities:

Here’s how Great Managers do those 4 Things

(1) Selecting a person - they select for TALENT, not simply experience, intelligence, or determination

(2) Setting expectations - they define the RIGHT OUTCOMES but not the right steps

(3) Motivating people - they focus on STRENGTHS, not weaknesses

(4) Developing people - they help him find the RIGHT FIT, not the next rung on the ladder

The Difference Between Managers and Leaders

• The difference is focus

• Great managers look inward - inside the company, individuals, notice differences that guide them into how to release each person’s talents into performance

• Great leaders look outward - at the competition, future, alternative routes forward. They focus on broad patterns, and press their advantage where others are weakest. But it doesn’t have to do with turning an individual’s talents into performance.

The 12 questions ...The 12 questions ...1. Do I know what is expected of me at work? --> You must set accurate

performance expectations. Not just goal setting. Know how to keep employees focused, what parts of the jobs require conformity or creativity on their part.

2. Do I have the right materials and equipment I need to do my work right? --> Give them to the person. Don’t expect them to do well without the right tools.

3. At work, do I have the opportunity to do what I do best every day? --> You must know how to select a person, and know how much of a person you can change. You must know the difference between talents, skills and knowledge.

4. In the last 7 days, have I received recognition or praise for doing good work? --> As a manager, you have only one thing to invest, your time. Who do you spend it with?

5. Does my supervisor, or someone at work, seem to care about me as a person? --> When an employee comes to you and asks “where do I go from here?” you should have a ready answer.

6. Is there someone at work who cares about my development? --> When an employee comes to you and asks “where do I go from here?” you should have a ready answer.

Human Beings are Messy

• People don’t change that much. You cannot force everyone into a particular role to do the job the exact same way (McDonalds). There is a limit as to how much a person’s style, needs and motivation can be changed. You can standardize them only so much. That’s why “casting” is important.

• An organization exists for the purpose of performance, and “performance” is any valued defined by an internal/external customer. You have to focus people on performance. The problem is that you cannot force everyone to perform in the same way. In some cases, you cannot force them to follow the same path toward performance. (Great managers spend the most time with their best, most productive people).

The Solution

• The solution -- Define the right outcomes and let each person find the way to achieve it. Now the fact that (1) people are different and (2) they need to focus on performance are in harmony.

• This encourages risk taking, growth and development.

• This solution is extremely efficient. The most efficient way to turn a person’s talent into performance is to let them find the path of least resistance.

• This solution encourages employees to take responsibility. Employees need to feel a certain tension to achieve. Defining the right outcomes creates that tension. It nurtures self-awareness and self-reliance.

However, Be Careful

• Don’t let employees risk everything and “break the bank” -- that’s what people tend to do when it’s not their own money and they feel no personal pain at loss

• Employees must follow certain required steps when they are part of a company or industry standard (ex. Computer communication standards)

• Required steps are useful only if they do not obscure the desired outcome -- people follow the literal rules rather than the meaning of the rules so they don’t know when to break them

• Required steps only prevent customer dissatisfaction but do not insure customer satisfaction. You must go the extra mile for that.

• Customers want accuracy (quality) -> availability -> partnership -> advice.

Casting People Correctly - the Best 1st Solution

• Your job is not to teach talent but help people earn the title “talented” by matching their talents tot he role and giving them development opportunities

• To find talents, know the talents you are looking for

• To help them improve their skills have them study the best performers, model their excellence, learn NLP to see how they move and think, and tape record what they say to make scripts

• STRIVING talents - why they are motivated to push, stand out, be competitive or charitable, …do they just want to be liked to be known a technically competent, ...

• THINKING talents - how he thinks, weighs solutions, considers alternatives, ...

• RELATING talents - who he trusts, fights with, builds relationships with, whom they are at ease with, who perform best with, ...

Spend the Right Amount of Time with Spend the Right Amount of Time with Your PeopleYour People

• Write down on the left, in descending order, who is most productive. Write down on the right, in descending order, who you spend the most time with. Connect the two lists with lines.

• Yes, spend time with strugglers, but best managers spend most time with their most productive employees. If you think your role as a manager is to CONTROL people or INSTRUCT others you’ll spend the most time with strugglers. If you think your job is a CATALYST, you are not fixing or correcting or instructing. You just spend time trying to figure out the best way to unleash people’s talents.– Set expectations

– perfect each person’s unique style

– run interference for them and get out of the way

Spend the Right Amount of Time with Your People ...Spend the Right Amount of Time with Your People ...

• As a manager you are always on stage. People watch what you do and copy it or respond to it.

• Human beings crave attention. If you pay less attention to the productive behavior of your superstars, you’ll get less of it. Because of indifference, your stars will start to do less of what made them stars in the first place.

• Investing in your best:– the fairest thing to do– the best way to learn– the only way to stay focused on excellence

• “I am going to be consistent with every one of you because I’ll treat each of you differently. The harder you work, the more you perform, the more you meet my guidelines, the more leeway I’ll give you. If not, you won’t work here for long.”

How to Manage Around a Weakness

Remember this Test?Remember this Test?

1. As a manager, would you rather have an independent aggressive person who produced $1 million in sales, or a a congenial team player who produced half as much. Explain your reasoning.

Pick the independent aggressive guy, even though they are harder to manage. Great managers aren’t looking for people easy to manage. They are looking for the talent to be world class. Therefore, take on the challenge of focusing a talented individual into performance instead of the challenge of turning nonproductive people into productivity.

2. You have an extremely productive employee who consistently fouls up the paperwork. How would you work with this person to help him/her become more productive?

Find out why this employee is having trouble. Maybe they lack training and if so, supply it. If they just don’t have the skill for it, find a solution that enables them to turn around their weakness for administration and focus on their productivity instead.

3. You have 2 managers. One has the best talent for management you have ever seen. The other is mediocre. There are two openings available: one is a high-performing territory and the second is a territory that is struggling. Neither territory has reached its potential. Where would you recommend the excellent manager be placed? Why?

Great managers always place the most talented manager in the higher performing territory. If the territory has not yet reached its potential, great managers will push for excellence as their measure and try to make that territory reach its full potential. Taking that territory to top excellence is just as challenging to them as moving a struggling territory above average. Then, take a turn-around expert and put them in the poor performing territory. If you put the less talented in the top territory, they will never make it the best and the poor territory may defeat your top manager, which sets up both people to fail.