Critic or Coach?

iStock-Unfinished-Business-1At The Mpower Group we are strong proponents of Competency Based Talent Management.  One of the greatest assets most organizations have is their talent, yet few companies make the investment in that asset relative to other investments.   A large part of our consulting practice in fact is focused on helping organizations build capability and competency through Competency Based Talent Management (“CBTM”). 

 We look at CBTM as a system that needs to be managed as such.  We also believe that, at its core, is a well- defined competency model that helps employees understand what behaviors are required to be successful in their role.  One element that is often a given, is Performance Management.  Companies have built elaborate systems and spent millions of dollars to evaluate employees on an annual basis, supposedly with the goal of improving performance.  An article published in HBR’s April issue entitled “Reinventing Performance Management” looks at how Deloitte is redesigning their own performance management system which is currently out of step with their corporate objectives.

“ In a public survey Deloitte conducted recently, more than half the executives questioned (58%) believe that their current performance management approach drives neither employee engagement nor high performance.”  Believe it or not, as part of the reinvention,  Deloitte is getting rid of cascading objectives, annual reviews and 360 degree feedback – watch out for the HR police :-) !

Here are some interesting discoveries that helped them to build the case for change:

  • Creating ratings for employees consumed about two million hours a year
  • Assessing employee skills produced inconsistent data which was due to individual raters’ perception
  • Performance management was focused on the past not on the future
  • The person best able to assess a team members performance was the team leader and they were not part of the process

As a result of this study, Deloitte set out to reinvent their system under three main objectives  1) recognize performance 2) clearly see the performance 3) fuel performance.

  • Recognize performance – at the end of each project (or quarterly, for long projects) teams leaders were not asked about an individual’s skills but rather about their “own future actions with respect to that person” (e.g. would you want that person on your team again OR is this person ready for promotion OR should they receive the highest salary increase / bonus possible)
  • See performanceteam leaders provide results and behavior observations of the team member to support  the “performance snapshot” – evaluation is timely, more frequent  and utilizes several data points
  • Fuel performance – team leaders check in with the team member often (even daily) to provide coaching and guidance as opposed to the once-a-year conversation behind closed doors. Because team leaders have heavy demands on their time, it is the team member’s job to initiate the check in

In my opinion, some of the elements of this performance management approach are very strong:

  • It is not an annual process but one that considers many data points and is led by the person that is closest to the team member
  • Looks to the future as opposed to the past; forcing the team leader to state whether they would want to have this individual on a future team (how many of us have been the victim of a poor performer that was passed along to us)
  • Places the team leader in the position of coach as opposed to criticizer – this is huge and if done well can go a long way to building better teams and fueling performance.  By the way, this has always been the job of the team leader, but as we all know this does not happen consistently or ever

By the way, requiring the team leader to take on the role of coach requires a different set of competencies which has to be factored into the entire competency based talent management system.  We have long held the opinion that modern performance management practices simply do not work.  For the most part, they are not integrated into the “system” of competency based talent management.  Like Deloitte and others we have surveyed hundreds of companies across numerous industries and have found VERY few that have ALL the elements of a comprehensive talent management program.  All the elements must work together to be effective.  So, while Deloitte is working to “reinvent performance management” they also need to ensure that their talent objectives are supported by recruiting, training / development, career management and succession planning as well.

 Let us know what you think and join in the conversation.  . . . . . .     


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Avoiding Pitfalls in Strategy Execution

ExecutionPitfallsVery rarely do I find an article that catches my interest such that I read it and reread it several times to make sure that I capture all the gems.  “Why Strategy Execution Unravels – and What to do About It” from Harvard Business Review is a must read.   According to the article, “a recent survey of more than 400 CEOs found that executional excellence was the number one challenge facing corporate leaders” globally.  In addition, “. . . . two – thirds to three – quarters of large organizations struggle to implement their strategies”. 

The authors uncovered five myths and replace them with approaches that they believe will help managers execute strategy more effectively.

Myth 1:  Execution Equals Alignment

Most of the companies studied did a pretty good job in developing the strategy, translating that into objectives, cascading those objectives down through the organization and then putting in a measurement process and rewarding performance.  These tools help to create alignment but do little to ensure execution.  Studies have found that these tools may be effective in managing vertical performance / commitment but not horizontal (across business units).  Since the execution of most strategic objectives require collaboration from multiple functions or business units, that is where the rubber meets the road.  Structures to coordinate activities across business units is what is really needed to improve execution.

Myth 2:  Execution Means Sticking to the Plan

Most of us have been taught to put a plan or roadmap together and then stick to it.  Executives often “view deviations as a lack of discipline that undercuts execution”.  From a practical standpoint, “stuff” happens during execution – both challenges and opportunities – that organizations need to respond to.  Successful execution requires organizations to be agile (not be confused with the AGILE methodology – which does apply here as well).  Managers need to have the ability to be creative in finding solutions to problems that pop up or unexpected opportunities.  The world does not stand still while we are executing a strategy, so as managers we need to be comfortable adapting to that change.  Also, the willingness to reallocate resources freely as you are executing your strategy is key as well. Whether that is shifting budget dollars or moving people between business units to meet changing demands, this can be a critical success factor in execution.

 Myth 3:  Communication Equals Understanding

Many believe that relentless communicating is a key to success.  Communication is CRITICAL, but messaging needs to be targeted, simple and consistent to ensure understanding.  Once communicated, follow up to see that there is a common understanding of the message you are trying to deliver – this step is often overlooked.

Myth 4:  A Performance Culture Drives Execution

While it has been “found that a focus on performance does shape behavior on a day-to-day basis”, that is simply not enough.  We have already discussed they fact that collaboration is the key to execution so why is it that “past performance is two or three times more likely than a track record of collaboration to be rewarded with a promotion”.  In other words, agility, teamwork, collaboration and flexibility are key competencies that need to be present to drive execution.  “Performance is critical, of course, but if it comes at the expense of coordination, it can undermine execution.” 

Myth 5:  Execution Should be Driven from the Top

Strong top down leadership is important and can be a short term strategy.  Relying on the CEO to drive execution can be a costly mistake and can quickly unravel if the CEO departs.  “Effective execution in a large, complex organization emerges from countless decisions and actions at all levels”.  This is known as distributed leadership.  “Although execution should be driven from the middle, it needs to be guided from the top”.  Distributed leaders not senior execs represent “management” to most employees and have the best chance of driving execution.

In summary, companies spend millions of dollars every year to develop a strategy and fall short when it comes to execution.  Instead of throwing more process and tools at the problem it might be time to take a step and back and look at some of the root causes of the problems.  At the end of the day, execution is all about people and how they define it.  Reframing execution as “the ability to seize opportunities aligned with strategy while coordinating with others parts of the organization” will go a long way to helping managers understand where the pitfalls lie.

Let us know what you think and join in the conversation . . . . . . .

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Too Many Suppliers . . . Keep Looking!

connectedMost of us can look at anything we “buy” on behalf of our company and see that we have opportunity for improvement.  We may have too many suppliers, not enough suppliers or not the “right” suppliers.  Whatever the situation, as Sourcing professionals it is our job to ensure that we have the best set of suppliers that provide the most value to our business partners.

I recently read an article published in HBR from Michael Porter (remember Porters Five Forces Model) & James Heppelmann entitled “How Smart, Connected Products Are Transforming Competition”.   The article explores the introduction of smart, connected products as a game changer that is “ushering in a new era of competition”.  The article points out that information technology is revolutionizing products” (no surprise here) but the real point is the pace of change is such that we need to constantly keep a pulse on our supply markets to ensure that we understand how industry competition is being reshaped.  If our role is to ensure we have the best set of suppliers for our business then we must be on top of changes in our supply markets.

Periodic reviews of your supply markets are critical.  Here are the key questions you should be trying to answer as part of your supply market analysis:

  • What are the economics of the supply industry, i.e., what drives the market?
  • How important is brand value in our category?
  • What are the main quality issues?
  • How global is the supply industry (present and future)?
    1. Threat of foreign competition
    2. Degree of political and currency risk
  • What is the technological complexity of the goods/services?
    1. Proprietary nature
    2. Ease of duplication
    3. Product life cycle
  • What are the primary value-added activities associated with the category?

Opportunities to change the paradigm

  • What are the critical success factors in the supply market?
  • Can industry leaders sustain their advantage over the long-term?
  • Do any markets for similar goods/services (or substitutes) represent a potential competitive threat to this one?

One way to keep on top of the competitive landscape within the supply market is to use Porters Five Forces Model.  Here are the elements of Porter’s model: 

  • Bargaining Power of Customer (Buyers) – Competition is high when buyers (as a group) have many choices of whom to buy from or when there are few buyers in the market.
  •  Bargaining  Power of Suppliers  – Competition is high when suppliers can exert influence on the market,  i.e., on your suppliers 
  • Threat of Substitute Products or Services – Competition is high if there are current or potential alternatives to using the product or service.
  •  Threat of New Entrants – Competition is high when it is easy for new players to enter the market.
  •  Intensity of Rivalry Among Existing Competitors – Competition is high when the industry has many players, there is little differentiation between products, or there is a history of aggressive marketing.

The article referenced above has Porter applying his five forces to the Smart, Connected Products industry.  It is a great, current example (right from the Horses’ mouth) and illustrates the type of analysis we should be doing as a profession to keep on top of our game.  As illustrated, the pace of technology is shifting markets soooo rapidly, it is hard to keep up.  Understanding the shifts in our supply markets and sharing that insight with our internal business partners will help us be able to add value beyond “cost cutting”.  It will also help us to continuously review whether we have too many suppliers, not enough suppliers or not the “right” suppliers.

 Let us know what you think and join in the conversation . . . . . . . . 


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The Commencement Speech Every Leader Needs to Hear

gradOver the last few years, I have sat through my fair share of commencement speeches.  From my perspective they were inspiring – filled with stories and examples of the importance of a college education and how hard work and perseverance will someday pay off.  Those speeches painted a “picture” of what every graduate imagined life would be like after graduation except that the “picture” isn’t even close to the reality they face.  

Their reality is:

  • a high student debt load that, in the last year alone, has grown by 10%;
  • a 12% unemployment rate for new graduates; and
  • a workforce where a generation of managers have already formed a negative opinion of their commitment, work ethic, and tendency to ask questions and seek feedback.

An article I read in HBR, The Commencement Speech Parents Need to Hear  gave me pause and made me realize that maybe we, as leaders, need to face a little of our own reality.  The “kids” we will be hiring; those we need to hire quickly as baby boomers start retiring in droves, may be our own kids (or at least raised the same way).  If we want these “kids” and our own to succeed in the workplace then perhaps it’s time to be on the receiving end of the advice. After all, our kids have been urged to speak up throughout their lives, but never has it been so important for other generations to listen. “Before the 2014 graduates embark on their collective journey into workplaces still struggling to adapt to changing demographics, senior generations would benefit by heeding advice from the Millennials’ perspective.”

What I found most interesting was the concept of looking at new hires as I would my own children – accepting and embracing all the values I had given them.  WOW! 

The commencement speech which I would recommend for leaders would be written by Millennials (hereafter referred to as “kids”), and directed primarily to one particular group in the audience: “the parents who raised them at home but cannot understand them at work.  And that speech would likely go something like this:”

“Parents, as you come here to celebrate your child’s graduation milestone, remember that the young person whose accomplishments you celebrate will soon be in the workplace – which also means that the “kids” raised by those who surround you will be in yours. Remember that each time you form a stereotype or paint the entire generation with an unnecessarily broad brush. And in that spirit, consider these six principles as guidance in your interactions with young people at work.”

1.  Think of each new hire as a future leader, set aside preconceived notions and, instead, pay attention to what truly will motivate young employees.

2.  “Recognize that the “entitled” label you tend to attach to “kids” is not entitlement at all, but rather the self-confidence and self-respect that you have instilled in them since birth. You raised your children to believe in themselves and to believe in their future success. Embrace this generations’ confidence as a building block of future leadership.

3. “Workplace navigation skills are critical to career success and advancement, but do not assume that all young workers arrive adept at steering their way forward. But if you are willing to invest in the process of meaningfully integrating young employees into the culture of your workplace, you will maximize the likelihood of optimal performance.”

4.  Replace clout with mutual respect. An open exchange of ideas invariably leads to a better result and a more engaged workforce.

5.  Pay greater attention to workplace dynamics, particularly around technology. Formalized reverse mentoring programs can help “kids” develop stronger relationships with their more senior colleagues, which has the added benefit of making older workers more technologically proficient.

6.  “Kids” value work-life flexibility and its availability leads to workplace loyalty and engagement.

I hate to say this but we may need our “kids” more than they need us.  We need them to fulfill our dreams for their future but we also need them in the workplace.  The number of future retirees is staggering and we will have no choice but to welcome them into our offices.  Our future, their future and our economy, depends on it.


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Don’t Shoot – The Messenger May be MORE Important than the Message!

How many times have you had to deliver bad news and your opening line was, “Don’t shoot the messenger!”   As we think about and develop communications, both internal and external, we often agonize over form, format, timing, messaging, technology, etc. in an attempt to ensure that what we are communicating will be heard, spread to others and even acted upon.  What we don’t think about often enough is the messenger. 

In an article I read in Harvard Business review “The Other Factor that Makes an Idea Spread”, author Julianne Wurm notes that “. . . . . much of the desire to share an idea with others was linked to that idea’s carrier. It’s the carrier who gets the audience to open up, trust, and ultimately spread the idea. Some well-known examples of carriers of ideas would include Daniel Goleman, who popularized the idea of emotional intelligence in 1995 although the concepts and research were actually conducted by John Mayer and Peter Salovey. Malcolm Gladwell has brought forth the ideas of others in nearly all his books from Blink to The Tipping Point and Outliers. Maria Popova of the popular blog Brainpickings  connects different theories and opinions in unexpected ways.” 

I found this article interesting because communication and the ability to share and spread our ideas / recommendations is the most critical element of our jobs as Sourcing professionals.  If you buy the fact that most of our issues are internal – and believe me they are, STILL, then communication as a change management tool is critical to our success.  If the messenger really does matter, as noted above,  then we need to ensure that our messages are delivered by the most effective messenger we can find.

Here are some of the attributes of an effective messenger:

  • Ability to connect with the audience
  • Strong storyteller, thinker or writer
  • Make fresh connections and present clear arguments   
  • Likeable (people will listen to people they like :-) ) – the opposite is true as well
  • Give ideas context they may lack standing alone

By the way,  messengers can / should change depending on the content of your message and the recipient.  As such, developing a communication plan that includes the messenger as a key element is important. As you are deciding on your carrier, consider the attributes of a successful messenger.  Don’t assume that the most senior person in the organization is automatically the ideal messenger because the opposite may be true. 

When asked by our clients, “who is the first person you would hire for your Sourcing organization?” we always answer –  a marketing / communication star.  The reason is that “selling the change” is by far the most critical activity for an organization that is trying to change behavior across the organization and communication is on the top of the list in “selling the change”.  As you are considering which competencies are most critical in your sourcing professionals – it is strong communication skills.  If that is a skill gap for your organization, that may be the reason you are not making headway with your internal issues.

Remember, the next time you have an important message to communicate, make sure your messenger is embraced, not shot!

Let us know what you think and join in the conversation . . . . . .      

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