Sunday, December 16, 2012

Epic Steve Jobs Video On Brand Building

I love this video.

It is short. It is simple. And it is relevant to anyone who is trying to build a business, whether it be as a self-employed consultant, manager of a business unit or CEO of a large company.

For those who think that the rebuilding of the Apple business / brand does not apply to them, watch how seamlessly Steve Jobs talks about other categories including Milk and Shoes in the context of branding.


Sunday, December 9, 2012

X Marks The (Differentiated) Spot

It does not matter what industry you work in, there is always a company that is held up, and more often than not Benchmarked, as the best. In technology it is Apple, in retail it is Zara, in the 80's Toyota was the automotive doyen and in the airline industry South West Airlines seems to spring to the fore. These companies are defined by commentators as 'the best' with Business Schools and Consultants charging clients fortunes to try emulate the success.

In a recent article in the UK publication, Mark Ritson, examines Microsoft's strategy which appears to merely replicate Apple. Mr Ritson states, "There are three things wrong with competitor orientation. First, it’s impossible to differentiate because you are literally doing what your rival did before you. Second, you struggle to pull off your strategy because it was designed for a different organisation with different brand associations and very different core competencies. And third, there is no guarantee over the long haul that a brand like Apple has the right strategy either. Who knows if following it is actually the best move for the future?"

Such a statement should be of no surprise to followers of Harvard University Professor, Michael E.Porter, who is generally recognized as the father of the modern strategy field, and whose ideas are taught in most business schools around the world. Professor Porter is quoted as saying, "The granddaddy of all mistakes is competing to be the best, going down the same path as everybody else and thinking that somehow you can achieve better results."

In the article, 'Stop Competing To Be The Best', author Joan Magretta articulates Professor Porter's thinking by writing, "Everyone in the industry follows the same advice. Companies benchmark each other's practices and products. Customers, lacking meaningful choice, buy on price alone. Profitability deteriorates...... Nothing is more absurd — and yet more widespread — than the belief that somehow you can do exactly what everyone else is doing and yet end up with superior results."

With this in mind, think about your own position, whether you are a 'one-man-band' or part of a much larger organisation. Do you want to aim to be the best or do you want to be differentiated? One sees it time and time again, be it banks fighting each other based on interest rates, telco's fighting over handset prices or large accounting and legal practices winning business based on fees. Very little differentiation other than price! Trying to create value on price alone is an incredibly difficult strategy particularly if there is an established price leader - just ask all those failed businesses who have tried to compete against Aldi (German), Tesco (UK) or Walmart (US) on the basis of price. Yet it is differentiation that allows Target to co-exist with Walmart.

So what makes you or the business you work in unique? What is that point of differentiation that allows you to create value? Are you following the same path as your competitors, hoping it will lead to a better place, or have you clearly marked your differentiated X on the business landscape? Joan Magretta sums it up best when she writes, "Porter urges a different kind of competition: compete to be unique. Focus on innovating to create superior value for your chosen customers, not on imitating and matching rivals. Give customers real choice and price becomes only one competitive variable."

So how many competitive variables do you have?

Sunday, November 18, 2012

TED: Top 20 Most Watched

Regular readers will know I am a big fan of TED.

A couple of weeks ago ( 8th Nov) TED updated the list of the 20 most watched talks. The list is based on tracking of various site including ", YouTube, iTunes, embed and download, Hulu and more".
  1. Sir Ken Robinson says schools kill creativity (2006): 14,850,200 views
  2. Jill Bolte Taylor‘s stroke of insight (2008): 11,225,783
  3. Pranav Mistry on the thrilling potential of SixthSense (2009): 9,897,347
  4. David Gallo‘s underwater astonishments (2007): 8,204,051
  5. Pattie Maes and Pranav Mistry demo SixthSense (2009): 7,747,690
  6. Tony Robbins asks Why we do what we do (2006): 7,564,235
  7. Simon Sinek on how great leaders inspire action (2010): 7,539,516
  8. Brene Brown talks about the power of vulnerability (2010): 5,861,510
  9. Steve Jobs on how to live before you die (2005): 5,444,022
  10. Daniel Pink on the surprising science of motivation (2009): 5,534,123
  11. Hans Rosling shows the best stats you’ve ever seen (2006): 5,249,928
  12. Elizabeth Gilbert on nurturing your creative genius (2009): 5,020,869
  13. Arthur Benjamin does mathemagic (2005): 4,951,918
  14. Mary Roach on 10 things you didn’t know about orgasm (2009): 4,793,334
  15. Dan Gilbert asks: Why are we happy? (2004): 4,759,217
  16. Keith Barry does brain magic (2004): 4,475,303
  17. Stephen Hawking asks big questions about the universe (2008): 4,470,236
  18. Johnny Lee shows Wii Remote hacks for educators (2008): 3,997,174
  19. Jeff Han demos his breakthrough multi-touchscreen (2006): 3,982,775
  20. Barry Schwartz explores the paradox of choice (2005): 3,836,350
It really is a staggering array of topics although I wonder if there is some relationship between no.'s 14 and 15 :)


Wednesday, October 31, 2012

Oxygen: How Is Your Corporate Culture Breathing? (Part 3 - Final)

This is the third and final post in the series "Oxygen: How Is Your Corporate Culture Breathing?". Please see the previous posts for Part 1 and Part 2.

This final chapter looks at the primary drivers of a toxic culture.

Did you know Enron had core values that were known throughout the company as RICE? These core values were summarized as (Seeger, 2003, p. 65):
  • Respect: We treat others as we would like to be treated ourselves. We do not tolerate abusive or disrespectful treatment. Ruthlessness, callousness and arrogance don’t belong here.
  • Integrity: We work with customers and prospects openly, honestly and sincerely. When we say we will do something, we will do it; when we say we cannot or will not do something, then we won’t do it.
  • Communication: We have an obligation to communicate. Here, we take the time to talk with one another ... and to listen. We believe that information is meant to move and that information moves people.
  • Excellence: We are satisfied with nothing less than the very best in everything we do. We will continue to raise the bar for everyone. The great fun here will be for all of us to discover just how good we can really be.
To me, these are at the opposite end of a toxic culture spectrum. So what went wrong at Enron and continues in the toxic environments of so many organisations today? Answer - a toxic triangle. A vicious combination of Leadership (Destructive), Groupthink (followers) and the Business (Conducive) Environment.

In the book 'The Allure of Toxic Leaders: Why We Follow Destructive Bosses and Corrupt Politicians-and How We Can Survive Them' the author, Jean Lipman-Blumen, concludes that toxic leaders' followers are willing victims who allowed misguided bosses to appeal to their deepest needs, anxieties and fears i.e. the need for an ongoing wage. The author also explores how "followers inadvertently keep themselves in line by a set of insidious control myths that they internalize. For example, the belief that the leader must necessarily be in a position to "know more" than the followers often stills the followers objections."

Appealing to one's "deepest needs" is something we all live with. Who wants to lose their job in a tough economic climate? To see this articulated brilliantly I urge you to read the comments section of an article that appeared in Army Times, 'Army wants to rid top ranks of toxic leaders'. For example a reader commented, "Sad thing, nothing will happen. I know of many toxic leaders that got great OERs and are not only promoted, but are placed in command. Reality is, when you have a senior leader who is toxic, no one will step up because they know it will end thier (sic) career."

If Destructive Leaders are a key driver of a toxic culture is it possible for followers not to contribute or play a supporting role is such an environment? From a theoretical point of view, suggestions include, "At the follower level, organizations should ensure safe outlets exist for ‘outing’ leaders who engage in destructive behaviors and rhetoric. A second strategy might include establishing an ethics ombudsperson who, in addition to investigating organizational corruption, could also investigate allegations of leader toxicity." (Source: Leader toxicity: An empirical investigation of toxic behavior and rhetoric: Kathie L. Pelletier).

Similarly Lipman-Blumen suggests:

Five strategies can help followers move away from a toxic leader and do better in the 
  1. "Matriculating in the school of anxiety" – Confront the fear and worry of challenging a toxic leader. Exercising courage will make you stronger.
  2. "Seeking the leader within and strengthening democratic institutions" – Become independent. Use democracy to foster good leaders and vote out bad ones.
  3. "Demanding leaders who disillusion us" – Toxic leaders spread false comfort through their visions. Instead, embrace reality and live up to the demands of authenticity.
  4. "Kicking the vision habit and the we/they dichotomy" – Be willing to strive without being reassured that you are extra special and that a happy ending is in sight. 
  5. "Drafting the next generation of leaders" – See leadership as a duty, not a privilege.
The best way to repel toxic leaders is to recruit nontoxic leaders. Urge more humble, fair-minded potential leaders to step forward and “accept the valuable inconvenience of leadership.” (Source).

However practice and theory, like Execution and Strategy, often do not go hand in hand. The reality is that the most common means for followers to break the shackles of the toxic environment is to, as the article in CIO Magazine eloquently states,"... decide whether to stay or leave." Which sees me coming full circle to Part 1 in this series. Businesses with ethical cultures generate better returns for shareholders, whilst toxic environments have an adverse impact on the bottom line. Fact, not theory!

Sunday, October 7, 2012

Oxygen: How Is Your Corporate Culture Breathing? (Part 2)

A couple of weeks ago I wrote ‘Oxygen: How Is Your Corporate Culture Breathing (Part 1)’, which focused on quantitative research about the effects a toxic corporate culture can have on employee output and an organisation's performance as a whole.

This week’s follow-up article looks at the signs of a toxic corporate culture and how it affects employees personally.

So just what constitutes a toxic corporate culture?

An academic paper published by International Journal of Leadership Studies, titled from “Toxic versus cooperative behaviors at work: The role of organisational culture and leadership in creating community-centered organisations” (Gilbert, Carr-Ruffino, Ivancevich, Konopaske) provides an excellent summation of defining a toxic workplace: “A workplace may be toxic if: 
  1. mediocre performance is rewarded over merit-based output (Colligan & Higgins, 2006; Doyle & Kleiner, 1993)
  2. employees avoid disagreements with managers for fear of reprisal (Jones, 1996);
  3. personal agendas take precedence over the long-term well-being of the company (Atkinson & Butcher, 2003);
  4. leaders are constantly on edge and lose their tempers often (“Middle,” 2003);
  5. new leaders do not stay long and employee turnover is common; and,
  6. employees are treated more like financial liabilities than like assets (Macklem, 2005), and
  7. bosses routinely throw temper tantrums, make unreasonable demands, scream, and use obscenities (Anonymous, 2008).”
One word springs to mind when I read a list like this - Values. It is clear that when assessing those companies whose culture is defined as toxic, the values of the organisation are either corrupt, non-existent or exist in the world of PowerPoint templates only. In other words values misalignment equals toxicity. In such environments many people choose to leave the organisation. An early 2012 survey by Corporate Crossovers of more than 300 female entrepreneurs found almost a quarter (23%) cited that culture and values misalignment was the main reason they have left their corporate jobs. The results, as demonstrated in the previous post (Part 1) can materially impact the bottom line.

But what about those employees who stay? In a tough labour market, job choice is often limited and hence employees may be unable to resign without the security of a confirmed new job. Employees who continue to work under the stress of a toxic environment risk effecting their health. In a paper titled 'Workplace Stress: 'Etiology and Consequences' (Colligan and Higgins), the authors noting Katherine Macklem's work (point 5 above) state,

"Toxic workplaces are characterized by “relentless demands, extreme pressure, and brutal ruthlessness” (Macklem, 2005). Moreover, employees within a toxic work environment operate consistently in fear, paranoia, and increased anxiety states. Appraisals of threat or harm that arise from both high work demands and over-controlling/harassing environments have been found to be most often stress producing (Karasek & Theorell, 1990; Mausner-Dorsch & Eaton,2000). Employees experiencing chronic work stress have been shown to develop unstable blood pressure, increased cholesterol levels, muscle tension, diabetes, hypertension, ulcers, headaches, substance abuse, and clinical depression. Moreover, their capacity to concentrate and retain information becomes a problem. The employee also may experience significant anxiety, anger, and irritability (Israel et al., 1989), which may affect his or her capacity to maintain interpersonal relationships outside of the organization. Workplace stress has been shown to lower productivity, increase absenteeism, and create pervasive patterns of dysfunction in the workplace (Anderson & Puluch, 2001; Levin-Epstein, 2002). Stress has also led to changes in work habits, changes in personality (or social behavior), and job burnout. It is estimated that disorders related to stress annually claim nearly 10 percent of the earnings from businesses (Dyck, 2001)."

Often we talk and read about corporate culture as though it is merely academic theory in some business school's text book. However corporate culture is very real and a toxic corporate culture very dangerous. As the research shows a toxic work environment not only effects the health of an organisation, as measured by the bottom line, but also the physical health of employees. The evidence clearly demonstrates that it is in everyone's best interest, be they directors, managers or employees, to ensure that a toxic culture is not allowed to develop. So if you think your company's culture is sickly, chances are you may end up seeing a doctor... literally!


Part 3 (Final) will focus on the primary causes of a toxic corporate culture.

Sunday, September 16, 2012

Oxygen: How Is Your Corporate Culture Breathing? (Part 1)

How often do you think about oxygen? Me, hardly ever. Why? Well in part because I am healthy but I think another big part is because I cannot see, feel or taste oxygen. But I do know that I need it to live. You can lose more than one limb and still survive but without oxygen it's all over. And what happens when the oxygen levels deteriorate and the air you breathe becomes more and more toxic to your body i.e. carbon dioxide retention. You don't need to be a genius to work out that is not going to end positively.

This is the same way I feel about corporate culture which is often referred to as the character of an organisation. What does your culture look like? Can you touch your corporate culture? Edgar Schein (1996) defined organizational culture as the “shaped norms, values and assumptions” of how organizations function (p. 229). Quite simply corporate culture is the oxygen of an organisation.

When there is the right amount of oxygen (corporate culture) the outcome is quantifiably positive. Research by CBE found "there is a strong correlation between business performance and a strong ethical culture: stronger ethical cultures were found to deliver higher shareholder returns over a 10-year analysis period." However when the oxygen levels decrease a harmful environment is created. Likewise a corporate culture can be toxic. Think I am being melodramatic. The facts suggest not.

By interviewing "several thousand managers and employees from a diverse range of U.S. companies" authors Christine Porath (Assistant Professor at USC’s Marshall School of Business) and Christine Pearson (Professor at the Thunderbird School of Global Management) summarised the responses as follows:

Decreased their work effort
Decreased their time at work
Decreased their work quality
Said their performance declined
Lost work time worrying about the incident
Lost time avoiding the offender
Said their commitment to the organization declined
Sources: The Cost of Bad Behavior: How Incivility Is Damaging Your Business and What to Do About It and  How Toxic Colleagues Corrode Performance

I find these numbers staggering. Whether you are in a large organisation or a small business, having nearly 1 in every 2 employees decrease their effort or time at work, will have an effect on the bottom line.  The authors detail the efforts of Cisco Systems to analyze the cost of incivility in their company. Cisco found that "the organization wide costs for potential time lost by targets who worried about additional uncivil incidents and future interactions with offenders totalled nearly $2 million per year. With estimates for the costs of weakened commitment (also calculated as lost productivity value) and job changes (calculated on the basis of cost per hire) added in, the total topped $8 million." For a company that does around $6Billion in net income annually, $8mil is a small number. However make $8mil cumulative over 5 years and you have a $40mil cost (obviously no NPV has been applied). It all adds up very quickly.

On a significantly larger scale you can look at the effect the toxic corporate cultures have had on the collapse of Enron, Tyco, WorldCom and HealthSouth. Multi-billion dollar companies ruined along with many employee reputations. Author David R. Lease (Norwich University) noted, "The executives at Enron, WorldCom, and HealthSouth independently built their toxic organizational cultures, while the greed-crazed executives at Tyco were facilitated by an established board and management structure. Nevertheless, the results were the same: toxic leaders created organizational cultures that, up until the end, effectively masked their personal and the organizations’ unethical behavior, ultimately destroying the viability and reputation of their organizations and the public image of their employees (if only by association)."

In part because it is impossible to wrap your arms around corporate culture or look at it on a spreadsheet, conversations around the concept of corporate culture are often emotive yet vague in their ability to convey a bottom line benefit. Perhaps this is a reason so few financial analysts seem to focus on corporate culture although Stephen Sadove, chairman and chief executive of Saks articulated it brilliantly when he said in a New York Times piece, "When I talk to Wall Street, people really want to know your results, what are your strategies, what are the issues, what it is that you’re doing to drive your business. They’re focused on the bottom line. Never do you get people asking about the culture, about leadership, about the people in the organization. Yet, it’s the reverse, because it’s the people, the leadership, the culture and the ideas that are ultimately driving the numbers and the results."

In summary the right oxygen levels equals a healthy body, the wrong amount can lead to oxygen toxicity which ultimately can lead to a religious experience. Just ask former Enron COO, President and CEO Jeffrey Skilling who was quoted in the immediate aftermath of Enron’s bankruptcy filing as saying, “We were doing something special. Magical. It wasn’t a job – it was a mission. We were changing the world. We were doing God’s work.


Part 2 will focus on identifying what defines a toxic corporate culture and its broader effects

Sunday, August 5, 2012

Free. The World's Greatest Cloud Based Solution

OK, two obvious issues:
1-This is not a typical article that I would write. It is more simply me using my blog as a tool trying to source a solution I have not been able to find (after considerable searching).
2 - The title is misleading but hopefully catchy and therefore gets more reads which in turn should lead to a quicker result. It should read; "I have an idea for a cloud solution that is yours free to develop".

I have had this idea for a while and I have not found a solution. I know I am not the only one as the is a question on Quora about the issue. So without further ado here is my idea:

Photos Online
(Think Picassa + Windows + Cloud)

The Concept: 
In simple terms think Picassa sitting over your Windows file structure all in the cloud. The idea is for users to be able to keep all their photos and video on a cloud solution. The photos and videos should be able to be categorised and tagged. Users need to be able to have easy access to all their photos, hence batch upload and downloads are required. Finally if a user chooses to upload all their photos to the cloud service the fie structure (file categorisation) should remain intact and likewise remain so for the download. Here is an example of my file structure - image

Does anything like this exist at the moment?
No. At present you can store your photos on Picassa, Flickr, Windows Live Photo Gallery in a cloud service. Or you can add photos to Facebook, Instragram, Google + etc. However you cannot batch upload AND download all your photos. Cloud services like Dropbox offer the ability to batch upload and download but they do not have the ability to categorise and tag images etc. Also, and this is critical to the concept, you cannot download and upload an entire file structure. For example if you have saved all your photos in separate identifiable folders you may want to download the file structure with contents to make an external back-up.

Why is the file structure so important?
Like many people out there I have hundreds of photos saved on a hard drive in various files and folders. A number of these photos are from old scanned negatives or scanned photos i.e. old family albums. As these photos are from scans they are not embedded with the date of the photo etc. As such the way I have categorised my photos is important and meaningful to me. The last thing I would want is to upload all my photos to a cloud based provider and at some later stage discover when I downloaded them they were no longer categorised as originally set out.

There are a number examples provides in the Quora question but none provide the total solution. seems to be the closest.

Key Requirements:
1. The ability to batch upload and download photos and video in their file / folder structure to a cloud service
2. Secure sign-on with strong privacy rules
3. Ability to  organise and categorise photos and video i.e.
a. Tags
b. Hierarchy
c. Dates etc
4. The ability to share specific photos / folders with external users
5. Potential ability to customise key parts of a user’s area. i.e. A professional photographer may want to create a branded page and give access to clients to review photos.

The reason that I am putting this idea up on the web is;
1 - there may already be a solution. PLEASE do not email me with a half baked solutions. If it does not tick all the boxes above then, as I suspect, the solution does not yet exist.
2 - I use open source programs and I am always blown away by the generosity of those who put the time and effort into creating software to give it away. As such I would love this to be developed in an open source environment.
3 - If someone does decide to build the solution for commercial purposes. it would be great, if like Drop Box, Sky Drive etc that an intial amount of Gb of storage were available for free.

So that is it. If it exists let me know please. If it does not exist, for good reason, please let me other readers know why by using the comments section below.

If it does not exist and you decide to build it, I wish you the all the best. By me a beer when your solution has  made you your fortune :)

Tuesday, July 24, 2012

Outsourcing To Crowdsourcing

Outsourcing is defined as the process of contracting an existing business process which an organization previously performed internally to an independent organization, where the process is purchased as a service (link).
The word 'Outsourcing' is highly emotive in the pubic domain. Loved by consultants as a means to cut costs, it is loathed by those whose industries and livelihoods have been "off-shored". More recently the term Crowdsourcing has entered the mainstream vernacular even though early Crowdsourcing articles appeared some six year ago (2006)

Interestingly the term Crowdsourcing does not appear to attract the negativity of Outsourcing even though the definition is almost identical. Crowdsourcing is a process that involves outsourcing tasks to a distributed group of people.

The difference between crowdsourcing and typical outsourcing is that a task or problem is outsourced to an undefined public rather than a specific entity, i.e. an external organisation (link).

Like Outsourcing, Crowdsourcing can generate significant cost savings. However a key benefit of Crowdsourcing over Outsourcing is scale. Using a hypothetical example, lets assume I wanted a new Logo or Website designed for my business. Due to various reasons the Marketing department has seen a reduction in employee numbers as a decision was made to outsource various previously helped in-house roles i.e. a Designer. Under the Outsourcing model, the decision would lead to preferred supplier arrangements established with Design agencies who would produce the work on an as needs basis. However using the Crowdsourcing model the business could turn to a site such as 99 Designs. Rather than a couple of preferred suppliers you have, potentially 10, 20, 30 designers bidding for the work. Rather than a handful of options the business will be faced with potentially hundreds of designs to choose from. And finally, rather than paying a design firm thousands in fees the business may incur a total cost in the low hundreds.

Just as Outsourcing is not limited to Manufacturing, Crowdsourcing is not limited to design. Crowdsourcing website examples including:

Company Name (link to website)
Domain Names Let the crowd help you choose a great url for your business.
Contracting (multiple services) Post your job / project description to thousands of potential hires.
Funding Have an idea that needs funding, then let the crowd at Kickstarter help you.
Funding Similar to Kickstarter.
Product Development We serve as a platform for everyday people who have a product idea that they don't know how to bring to market. We help develop them into commercial ideas with big market potential and Genius Crowd creators share in the profits.”
Product design and development Allows amateur inventors to put their designs into production, releases new products at a breakneck speed.
Data "Instantly hire millions of people to collect, filter, and enhance your data"
Content creation and data enhancement (charity) Large tech companies outsource small piecework that Samasource calls ‘microwork’ to people across the developed world.
Video Production Crowdsourced video production
Contracting (multiple services) "The Mechanical Turk service gives businesses access to a diverse, on-demand, scalable workforce and gives Workers a selection of thousands of tasks to complete whenever it's convenient."
Food The U.S. specific  site seeks to document the entire food system. The aim is to provide a reference tool that will tell you where the food on your dinner table comes from.
Software and usability testing The world's largest marketplace for software testing services

And do not just think Crowdsourcing is the domain of small businesses, contractors and entrepreneurs. Have a look at the Crowdsourcing effort by Kraft Foods, a company that generates over US$50Bil in revenue (source).

Crowdsourcing is not going to replace all Outsourcing. For example in large scale manufacturing where the Outsource provider is required to make long-term capital intensive commitments with a requirement for ongoing / continuous production.

However there is no disputing the fact that Crowdsourcing is changing the face, or a significant part thereof, of Outsourcing. Small businesses have access to design capabilities of large corporations. New products can be development and sold with unprecedented time savings. Software entrepreneurs can have their code tested by an army of testers. When you think about it the opportunities that Crowdsourcing offers are amazing. Imagine a world where you could Crowdsource your business plan, marketing plan, logo and brand identification, new product concepts, product development,online sales platform etc. Whether you are a small business, mid-sized division fighting for attention in a large corporate or a sole entrepreneur the opportunities become equally available.

Like Outsourcing, Crowdsourcing provides the flexibility to save significant amounts of time and money. However unlike Outsourcing, Crowdsourcing can offer significantly more options when supplied by potentially thousands of service providers. Whilst detractors may point to the quality over quantity argument I prefer to turn to the French writer, Jules Renard who said, "Talent is a matter of quantity. Talent does not write one page, it writes three hundred."

Additional info:

A) Feel free to add other Crowdsourcing websites in the comments section

B) Other links you may find interesting:

Monday, July 16, 2012

Jargon: "Never use a long word where a short one will do."

Recently I circled back with some peers. We were trying to add some colour to deck the EIC had conceptualized. The intent was for a transformative break through but the numbers did not gel and the ultimately our collective was able to provide little value-add without throwing the EIC off course.

Translation: Who knows but this is the sort of nonsense I, and am certain you do to, come across often enough in the business world. Invariably it seems that when one word goes "out-of-fashion" it is replaced by two more in-vogue vocabulary busters.

Firstly, let me start off by saying that I have been guilty on many occasions of using jargon, in all its dubious forms. In part, I believe it is because the use of this language has become a norm in the corporate sector hence it is accepted with little to no resistance.

Before I delve a little deeper into the murky world of jargon let's look at the definition of the word. Merriam-Webster dictionary defines jargon as:

1.a: confused unintelligible language
  b: a strange, outlandish, or barbarous language or dialect
  c: a hybrid language or dialect simplified in vocabulary and grammar and used for communication between peoples of different speech

2. the technical terminology or characteristic idiom of a special activity or group

3. obscure and often pretentious language marked by circumlocutions and long words

But why did this become a norm? How did "confused unintelligible language" become so pervasive in our daily lives? Tragically it seems there appears to be a belief in the business sector that the more jargon used the greater one's intellect and ability. Conversely the greater the use of plain speaking the lower ones intellect / ability is. This ridiculous correlation appears more akin to a game of Scrabble than one's competence.

The good news is that there are many of you who appear to feel the same way towards the use of jargon in our daily work lives. The chart (Chart 1) is based on a survey from the Harvard Business Review blog titled "I Don't Understand What Anyone Is Saying Anymore". Over 9,000 votes later and "Thinking outside the box" takes first prize for meaningless expressions followed closely by one of my favourites "Synergy".  The survey is fairly limited in its choices and excludes such examples (to name a few) as:

  • right-sizing 
  • redeployment, 
  • mission-critical
  • goal-oriented 
  • best-practices 
  • paradigm shifts 
  • customer-centric 
  • low-hanging fruit 
  • value-add
  • keep me in the loop
  • optimize
Even with its limitations the survey does provide an insight into what expressions irk the most from a sizeable data set.

So how does one combat the barrage of meaningless expressions? Approximately 65 years ago George Orwell felt strongly enough about a similar topic that he penned the essay Politics And The English Language.   In the Essay George wrote, "But one can often be in doubt about the effect of a word or a phrase, and one needs rules that one can rely on when instinct fails. I think the following rules will cover most cases:
  1. Never use a metaphor, simile or other figure of speech which you are used to seeing in print.
  2. Never use a long word where a short one will do.
  3. If it is possible to cut a word out, always cut it out.
  4. Never use the passive where you can use the active.
  5. Never use a foreign phrase, a scientific word or a jargon word if you can think of an everyday English equivalent.
  6. Break any of these rules sooner than say anything outright barbarous.
These rules sound elementary, and so they are, but they demand a deep change of attitude in anyone who has grown used to writing in the style now fashionable. 

So the next time you are about to string a sentence together that comprises an "optimize" here and a "goal-orientated" there, stop yourself. Whilst the gentleman who wrote Animal Farm may have been expressing his views about writing and politics, his words are equally relevant in the today's business world. After all it is difficult to argue with, "Never use a long word where a short one will do". Now that is value-add :)

Sunday, June 17, 2012

KISS: What Does Your Brand Stand For?

For the purposes of this article, feel free to interchange the words Brand and Business where you see fit.

The word 'brand' is derived from the Old Norse brandr meaning "to burn." It refers to the practice of producers burning their mark (or brand) onto their products (often animals) to signify ownership. I am sure most of you have witnessed how farmers brand their cattle, often featured on various shows / movies. The process appears painful but relatively simple. Additionally the 'mark' also appears relatively simple. After all what is the farmer going to do (or the old Viking for that matter)? Use calligraphy! The reality is the mark needs to be clearly visible and easily identifiable, as the animals are constantly moving and disputes over animal ownership should not require the expertise of an art interpreter.

Fast forward to today and the world of corporate branding has become a complex array of terminological, seemingly all designed for various consultants to impress their clients. Terminology that includes, but is certainly not limited to, Brand Pyramids, Brand Values, Brand Platform, Brand Promise, Brand Wheel etc etc etc all used to define and articulate the brand. The same goes for the current rage, Personal Branding. As you will see a simple Google search on Personal Branding will offer countless hours of reading on the subject. As an aside, the term Personal Branding appears to be have been first used and discussed in an article titled 'The Brand Called You' in 1997 by Tom Peters.

When did 'what you stand for' become so complex? Albert Einstein said: “If you can’t explain it simply, you don’t understand it well enough". Why is it we have allowed this level of complexity to enter the business vocabulary when it is the simple definitions that are so often the strongest? It is apparent the KISS acronym (Keep It Simple Stupid) has long been disregarded in the world of brand articulation. Do not get me wrong, the management of brands and businesses does require expertise and science. For example, without a distinct market position (Positioning) and well articulated brand attributes, the ability to clearly stand out in a competitive environment is highly improbable.

I agree with Mr Einstein. I believe that so many brands are similar and vanilla that they meld in to one, or put another way, commoditised. Perhaps this is the reason for the level of complexity as business owners and brand consultants try create imaginary positions in the market place. Unfortunately for these groups there is only one voice that matters. The customer. You can have the most brilliant looking slide deck defining the brand but if the customer does not get it then you have lost the battle. To paraphrase the Einstein quote, "If you can’t explain it simply, your customers won't understand it."

Take a step back (figuratively) and ask yourself, "Can I define my brand in a handful of words". Then go ask the same question to another handful of employees / peers. Do the words line up? Can everyone explain, with simplicity, what the brand stands for? If the answer is yes then congratulations, you are better for it. However if the answer is no then I strongly urge you to implement a program that defines your brand clarity / articulation. Remember if you cannot do it, how do you expect your customers, potential employers, contacts etc to do it? And they won't. In today's environment where there is a substitute brand, product or business just waiting to gain the upper hand, no one is intent on hanging around waiting for you to try explain yourself or what your brand stands for. If Vikings burnt their mark to signify ownership, or 'brandr' as the old Norse would have called it, then how to you define what your brand stands for, to signify like you, as Albert Einstein said "understand it well enough". I suggest you start with a KISS.


A couple of brand articles you may enjoy.

Thursday, June 14, 2012

You Are Not Special!

"Contrary to what your U9 soccer trophy suggests, your glowing seventh grade report card, despite every assurance of a certain corpulent dinosaur, that nice Mister Rogers and your batty Aunt Sylvia, no matter how often your maternal caped crusader has swooped in to save you, you’re nothing special" David McCullough Jr, 2012

David McCullough Jr. is an English teacher at Wellesley High School in Boston, USA. His speech has gone viral and for good reason, it is brilliant! David has been in the media lately 'defending' the speech but in reality there has been massive overwhelming support / reaction to his considered words.

Here is the video for you to enjoy.

“Climb the mountain not to plant your flag, but to embrace the challenge, enjoy the air and behold the view. Climb the mountain so you can see the world, not so the world can see you.”

Sunday, June 10, 2012

The Other 3 R's: Recognition, Remuneration and Retention

A former colleague of mine was telling me about the new company she had just joined. She was baffled by the fact that employees would get their full bonus even if they only hit 95% of their revenue targets. Additionally, she could not reconcile how employees would receive considerable monetary recognition for non achievement. In her mind the bonus paid was recognition by the company for an employee achieving a set of metrics and not simply a form of salary paid for coming to work and not meeting budget.

To be blunt I was not any help in the conversation, as I did not have the facts. Was the 95% a set metric? Did 95% represent above industry average year on year growth? Without these facts it was difficult to provide meaningful input however the conversation did prompt me to think about how employees are recognised in the work place environment. In turn this also prompted me to consider the relationship between Recognition and Retention.

Research shows that Praise and Recognition are crucial for increasing employee productivity and engagement. An often cited study is the 2003 Gallup Employee engagement, satisfaction, and business-unit-level outcomes: a meta-analysis by Harter, J.K., Schmidt, F.L., & Killham, E.A. The study found that individuals who receive regular recognition and praise:
  • Increase their individual productivity
  • Increase engagement among their colleagues
  • Are more likely to stay with their organization
  • Receive higher loyalty and satisfaction scores from customers
  • Have better safety records and fewer accidents on the job
  • Lower negative effects such as absenteeism and stress.
It should be noted that the research included "more than 10,000 business units and more than 30 industries".

But what about money? Isn't a salary a key driver of retention? Well according to a number of surveys over various time periods the answer is no.

In 2000 executive search firm BridgeGate LLC conducted a study of 660 American workers. The study included looking at what would persuade the workers to stay with their current employer. BridgeGate found that although a raise was the most common response (43.2%), non-monetary issues were cited by more workers as motivators (50.5%). The non-monetary motivators included:
  • improved benefits programs (23.1%)
  • flexible work schedules (14.1%)
  • stock options (8.6%)
  • better training (4.7%)
A 2009 study by Robert Half International asked the executives, “Which of the following is most likely to cause good employees to quit their jobs?”
  • 35%  replied unhappiness with management
  • 33%  replied limited opportunities for advancement
  • 13%  replied lack of recognition
  • 13%  replied inadequate salary and benefits
  • 1%  replied bored with their job
  • 5%  replied other/don’t know
Finally, a study of 1,000 executives by The Adele Lynn Leadership Group found that 51% of employees interviewed said that they would work for slightly less money if other conditions were present. The top four reasons cited for leaving an organization included:
  1. organizational practices that weaken morale
  2. poor fit between skills and culture
  3. no concern for growth and development 
  4. inadequate training.
Whilst the findings of the various studies are noteworthy, I find it difficult to reconcile how salary seems lower on the importance scale for so many people, when I know that through the hundreds of interviews I have done with various job applicants two key reasons for not taking the job have been:
  1. "The job is not paying enough."
  2. "I received a counter offer from my current employer and have decided to stay."
The answer lies somewhere in between and is well articulated in the book The Enthusiastic Employee: How Companies Profit by Giving Workers What They Want by David Sirota, Louis A. Mischkind, and Michael Irwin Meltzer (2005) who suggest through their "Three Factor Theory of Human Motivation in the Workplace" that there are three basic goals of people at work, namely
  1. Equity: (To be treated fairly). In an article for Knowledge @ Wharton, Sirota states " Employees want to know they are getting fair pay, which is normally defined as competitive pay. They want benefits and job security. These days, employees especially need medical benefits, so those have become significant. On the non-financial side, employees want to be treated respectfully, not as children or criminals. Equity is basic. Unless you satisfy those needs, not much else you do is going to help. If I feel underpaid and if I feel that the company is nickeling and diming me, or wants to pay as little as possible, there is not much else an organization can do to boost my morale. This runs contrary to what a lot of people in my field say -- that pay is not that relevant. Baloney. It's terribly, terribly important."
  2.  Achievement: Employees need to take pride in their accomplishments by doing things that matter and doing them well. They need to receive recognition for their accomplishments and take pride in the organization's accomplishments. (Note: This is supported by the Gallop research above.)
  3. Camaraderie: "The quality of social relationships in the workplace - its `social capital' - ... are critical for effective performance and, therefore, for a sense of achievement in one's work."
So back to my former colleague. Was she right to be upset? Who knows! Maybe the company had a poor incentivisation scheme, maybe it didn't. What I do know is that if you want to keep (Retain) great people, money is important in that it is crucial for an employee to feel as though they are paid fairly. However equally important are non-monetary factors such as Recognition that actually lead to monetary improvement for organisations. Like so many aspects of the corporate world this is a balancing act. However, as the data suggests if an organisation gets the balance wrong employees won't hang around to see if the company will right itself.

Wednesday, May 30, 2012

Help Wanted.

It is hard asking for help. Not basic or simple help i.e. can you help me with my luggage but deep and real help i.e. I don't know how to fix this broken business and I need your help.

There are number of reasons, often mixed together, that I have witnessed or indeed been guilty of myself, which hinder one's ability to seek assistance. These include (in no particular order):
  1. Fear
  2. Pride
  3. Stubbornness
  4. Arrogance
  5. Weakness
  6. Shame
Fear: The most common fear I come across is the fear of getting fired. It is as simple as that. People are afraid to ask for help in case it gets them fired. Remember what I am talking about here is not simply an employee asking for some basic help, but an employee, manager, CEO asking for help because they are at a loss as to how to resolve a key business issue. For example, if a Head of Sales hits a brick wall and went to his / her General Manager and said, 'I need you assistance. I don't think I am going to be able to hit the number without your help", there is a common belief, rightly or wrongly, that the Head of Sales will soon be looking for a new job.

Pride: Most often coupled with Arrogance, Pride seems to be substituted for intelligent decision making, by those whose opinions of themselves are traditionally front and centre of all others. Pride is not only the domain of arrogant CEO's or established business owners, but can be witnessed existing in countless business schools where the word hubris is confused with a  type of flora by the newly minted alumni. Trust me on this one, I have an MBA :)

Stubbornness: I remember a particular incident with a very wealthy business owner who was interested in fixing his business. It was a great start but when it came to actually applying the medicine, he dug his heals in for no other reason than we were tampering with a particular part of his business that was his passion. Even applying a fact based approach did not help. Fixing the part of the business where his head went before his heart was no issue. But fixing the part of the business which was lead by his heart was a no go zone.

Arrogance: "Smartest guys in the room", does not just apply to Enron (see Link). I have witnessed on a number occasions business owners or super smart financiers (sorry intelligence as measured by IQ), usually men,. say "Thanks but no thanks, we have it sorted.", "If it gets much worse we will call you but we think we have it covered" and my all time favourite, "We don't need F&#@ing help, we need sales." only for the primary creditors to call their preferred administrators a couple of months later to try claw as much of their money back as possible.

Weakness: This may relate to the topic of Fear in so much that the Manager, CEO, etc believes that by showing such weakness, their livelihood may be at stake.

 I have spoken with a number of managers who talk of being "embarrassed" when consultants have been bought in (sometimes forced in buy external parties i.e. owners, creditors etc) to try improve the given business. This is particularly prevalent where business owners who have worked hard to build their business are often embarrassed by the given business predicament. In many such instances, to quote William Blake, “Shame is pride's cloak.

So how do you fix it? A simple word, but seemingly difficult to execute in the modern corporate world:
  1. Humility
Humility: As someone (unknown) wiser than I once said, "Swallow your pride occasionally... It's non-fattening!"

Putting up the 'Help Wanted' sign is not easy. But decide how you want to make your mark. Is it as someone who instigated the fixing process or is it as someone who knew there was a problem but sat on their hands? 'Was proud with sore hands' would not exactly make a great epitaph.

Tuesday, May 8, 2012

Are You Growing Backwards?

Question: If your business / division grew by 10% but overall market in which your product / service operates grew by 50%, did you in fact grow?  Let's look at this in a little more detail, as outlined in the tables below.

(Folks: Please do not write to me and say I am using ridiculous numbers. I am using exaggerated numbers to illustrate the point succinctly).

Growth rate
As you can see, this very simple example shows your business / division growing its' revenue by 10%. At the same time the rest of the market grew by 50%.

Therefore when assessing the growth of your business / division, you can see that you actually went backwards relative to the market.

So why is this important? Most managers would be ecstatic with 10% year-on-year growth. However the issue is not whether the business has grown. That is a given. The issue is that, in this scenario, competitors are growing faster and you are being left behind.

To illustrate this point further lets extrapolate the exact same growth rates (10% and 50%) over a five year period.

On the one hand, congratulations. Over the five year period you grew by 46%.  However on the other hand, commiserations. Over the same period of time you went from having 10% market share to only 3%. Quite simply all your competitors are roaring away and leaving you behind.

Think about what this now means for your business. For example:
  1. As a supplier to various companies are you becoming to be seen as a niche player within the market?
  2. Do potential customers worry about where your business is headed as they are continually bombarded by the success of your competitors?
  3. Are your competitors achieving scale benefits not available to you?
  4. Do these scale benefits provide a price benefit to your competitors that make it more and more difficult to compete?
Before we continue, it is important that I clarify that I do not advocate growth for growth sake. We have all witnessed countless numbers of large companies becoming financially crippled due to excessive debt through aggressive acquisition growth strategies that appeared great on paper but where, for whatever reason, the benefits (often couched in the term 'synergies') never materialized. However I do advocate having a clear understanding of the relativity of your business' growth versus your competitors (your market). 

Understanding how you are performing relative to your competition will give you improved clarity on your business' true performance and market positioning. This will help develop your growth strategy / plan and the execution required to achieve the plan's objectives. Defining your growth strategy is not simple. If it was every business would be growing. However where you want your business to be in five years is reflective of many inputs, including the competitive / market environment. Planning to grow at 10% may not be acceptable when everyone around you is growing at 50%. After all no one wants to be grown out of existence.

Sunday, April 22, 2012

Are You To Blame? Your Mirror Moment.

How's your Latin?

Iniquissima haec bellorum condicio est: prospera omnes sibi vindicant, adversa uni imputantur.” Tacitus, Agricola Book 1:27 (written around 98AD). This translates to, “It is the singularly unfair peculiarity of war that the credit of success is claimed by all, while a disaster is attributed to one alone.” which has made its way to the well known phrase “Success has many Fathers. Failure is an orphan.

In my view this is not an " unfair peculiarity " but rather a hallmark of a genuine leader.

I have always thought the best job in the world would be a food critic. Imagine not creating a single palatable thing and then having the bravado to be the so called culinary expert. You would get paid to eat well without the ability to recreate the food you just ate. Brilliant! The easiest job would go to the movie critic. The most you have to do is chew and swallow your popcorn whilst sitting on a comfortable chair for around two hours.

Business is very much the same. We are all experts when we are critics. That is because it is a lot easier to point your finger at someone else than turn your finger to your chest and say, “It is my fault.” In part I believe that is because fear is a mechanism that drives blame i.e. I fear losing my job if I am at fault. Hence, taking responsibility when things go wrong is hard. When you are Head of Sales and some within the team miss their numbers, it is so easy to blame the individuals. When you are selling winter coats and it’s a hot sunny day outside it is easy to blame the weather for poor sales.

However, like it or not, a key pillar of leadership is taking responsibility and ownership, whether the outcome is positive or negative. Facing your own failings is critical to accepting responsibility. This is often referred to as your "Mirror Moment", as in "one looks in the mirror and realizes .....".

In the business book Classic 'Good To Great', Jim Collins refers to 'Level 5 Leadership' and the 'window and the mirror'. Level 5 leaders are defined as those that "look out the window to apportion credit to factors outside themselves when things go well. .... At the same time, they look in the mirror to apportion responsibility, never blaming bad luck when things go poorly."

If you do look in the mirror and realize a) you are to blame and b) you are not too sure how to fix the situation. I have a potential solution. It may not always work but I have found it a good way to start. I advise you to talk to employees on the floor, customer service centre, warehouse etc what they would do to respond to the given issue. You will be, although you really should not be, surprised at how much your employees know. Often much more than you! The combination of admitting you do not know it all and listening to your employees' views and suggestions may just be the medicine to your business ills. As one of my favourite leaders, Winston Churchill said, '"Courage is what it takes to stand up and speak; courage is also what it takes to sit down and listen."

As initially stated, it is far easier to be a critic than facing your own failings. However taking responsibility through your "Mirror Moment" will be key to your development as a leader. After all it may not be all about you but you would be a good place to start... even if it means admitting you are an orphan.

Thursday, March 22, 2012

Do You Celebrate Wins, Even When You're Losing?

On a recent engagement, an auditor was reviewing the customer feedback process as part of the broader Quality Management process. Towards the end of the discussion the question was raised, “Where do you capture all positive comments from your customers?”.

What makes this question so important is that the business was going through significant change i.e. employees were reapplying for their roles, cost reduction initiatives etc.

Whilst the question may be related directly to a customer feedback capture process it nevertheless highlights a recurring theme I see in a number of businesses – everyone talks about celebrating wins but hardly anyone seems to do a good job of it.

When an organisation is undergoing sizeable change, particularly when the financials are poor and cost cutting is prevalent, the outcome of celebrating these small wins becomes a critical part of the building blocks in rebuilding the company. Managers, Business Owners, CEOs etc who feel as though the tide is up to their nostrils often lose sight of the importance of celebrating small wins. This is understandable when they may be coming to work and facing red ink and disenchanted employees. In a world divided by winners and losers, the employees may certainly not be feeling like winners with office gossip often centred on a "sinking ship"

However this is where Leadership takes a central role. By celebrating a win a number of critical forces come into play. As John Kotter, author of The Heart of Change, states, "These short term wins are essential, serving four important purposes:
  1. Wins provide feedback to change leaders about the validity of their visions and strategies.
  2. Wins give those working hard to achieve a vision a pat on the back, an emotional uplift.
  3. Wins build faith in the effort, attracting those who are not yet actively helping.
  4. Wins take power away from cynics."
Additionally Kotter adds, "Not all wins are created equally. In general, the more visible victories are, the more they help the change process."

Faking a smile does not help. Those Managers, Business Owners, CEOs etc who take control of the situation and display sold leadership characteristics will celebrate the win with empathy and genuine thanks to those employees, whether individuals or teams, ensuring positive momentum is established. 

Everyone wants to be a winner but the reality is that in the competitive world of business, almost all, if not every, company will go through some considerable change effort in its life. However even when times are tough and the proverbial has well and truly hit the fan, and losing seems the constant outcome, its then that feeling like a winner can make a material difference to the bottom line.

Monday, March 5, 2012

Aligning Values. Game On!

A number of years ago I did some work for a company who proudly told all employees that the core values  (there were 8 in total) included:
  1. Courage
  2. Integrity
  3. Unity
When it came to "Courage", employees were afraid to tell the CEO they (I am using 'they' instead of he or she) were wrong in case the employee got sacked. 

Every day employees would switch on their computers and low and behold there were the corporate values spinning around and around on the desktop. You see, if it is on the computer then it must be true!

McKinsey 7s
In 1980 an article appeared in Business Horizons, called "Structure Is Not Organisation" written by Robert Waterman, Tom Peters and Julien Phillips. In the article the 7-S framework first appeared. It was later (1982) made famous in the book In Search Of Excellence by Waterman and Peters.

At the heart of the 7-S model sits Superordinate Goals which was later renamed Shared Values. To quote the Business Horizons article, "The word "Superordinate" literally means of higher order. By superordinate goals, we mean guiding concepts - a set of values and aspirations, often unwritten, that goes beyond the conventional formal statement of corporate objectives. Superordinate goals are the fundamental ideas around which a business is built. They are its main values. But they are more as well. They are the broad notions of future directions that the top management team wants to infuse throughout the organization. They are the way in which the team wants to express itself, to leave its own mark."

Values are subjective. My values are not the same as yours. Likewise organisations may have very different values. Think PETA vs Exxon. Finally you may work at a company where your own values do line up with the corporate values.

As a Manager, Business Owner or CEO it is very easy to manage by numbers, but what about managing by values. Personally I have found this considerably more complex when an organisation is undergoing significant change. This is because not only are people losing their jobs, income etc which in itself may be misaligned with many peoples' personal values but at the same time new employees may bring with them a different outlook with their own values. Creating a culture aligned to the corporate values is  not only difficult but without doubt a hallmark of great leadership. In "Who Says Elephants Can't Dance" (2002) former IBM CEO Lou Gerstner, the man credited with the mammoth turnaround of IBM wrote, "If I could have chosen not to tackle the IBM culture head-on, I probably wouldn't have. My bias coming in was toward strategy, analysis and measurement. In comparison, changing the attitude and behaviors of hundreds of thousands of people is very, very hard. Yet I came to see in my time at IBM that culture isn't just one aspect of the game—it is the game"

Just as the Business Horizons article stated in 1980, "... a set of values and aspirations", so Lou Gerstner wrote about "...attitude and behavior" some 22 years later.

Back to the company first mentioned in the opening paragraph. Simply putting a list of the "values" on everyone's computer is not changing a culture. It is merely stating a wish list. Without the CEO living the values, how could they expect employees to embrace the words spinning around on their desktop? Interestingly enough, the company, like many other large corporations, has performed poorly over the last few years, losing considerable market value. Whilst many would blame various economic and other external factors, one could argue that a lack of value based leadership has had just as much influence on delivering the bottom line. As Lou said "it is the game", and clearly the wrong game was played!

Thursday, February 23, 2012

Do You Remember Your Lollipop Moment?

Regular readers of my blog will know that I have written about what inspires me and about the subject of leadership.

The video below from TED is both inspirational and about leadership. The small bio on the TED site states, "In this funny talk from TEDxToronto, Drew Dudley calls on all of us to celebrate leadership as the everyday act of improving each other’s lives."

However that description does not do the 6 min 21 sec talk justice.

The essence of Drew's talk is that we are all leaders and that leadership is not about changing the world. I know many of you will think:
  1. What a load of crap
  2. Who knows
  3. Who cares
I urge you to care for 6 min 21 sec. This is a brilliant talk and one that may just change your view on leadership. Who knows, you may just remember your lollipop moment!

Monday, February 13, 2012

Why, Why, Why, Why, Why.....

Have you ever heard of the 5 Whys?

The 5 Whys is a questions-asking method used to explore the cause/effect relationships underlying a particular problem, with the goal of determining a root cause of a defect or problem (source).

The 5 Whys methodology was developed by Sakichi Toyoda and is delivered as part of the Toyota Production System (a composition of management techniques and philosophies). Taiichi Ohno who was the architect of the Toyota Production System, described the 5 Whys method as "the basis of Toyota's scientific approach . . . by repeating why five times, the nature of the problem as well as its solution becomes clear."

So what is so special about the 5 Whys that I have bother to write about it.'s simple. And it can also highly effective.

Below is a very basic example that I have put together to demonstrate the 5 Whys methodology in action.

Imagine you had just finalized delivery of your product to a customer. However the product arrived 3 days late. To find out why the product arrived late you decide to undertake a 5 Why analysis.

Step Reason Why
1 The stock arrived 3 days late. Why did this happen?
2 Because a Purchase Order was placed 1 week late with the supplier. Why was the Purchase Order place 1 week late?
3 Because  the financial feasibility / forecast was delayed. Why was the financial feasibility / forecast delayed?
4 Because the Product Team were held up by the Marketing team on what was to be advertised Why was Marketing holding up the product team?
5 Because the Marketing team were not aware that their decision impacted the Purchase Order time line Why was Marketing not aware of their role in the Purchase Order time line?
Because the business did not have a clearly articulated business calendar or process map that highlighted key stakeholders involvement in the decision making process.

In this example we see the issue moving from a late delivery to roles and and responsibilities within a defined process.

Clearly not all issues will have exactly 5 Whys. There may be 4, there may be 7. However it is generally accepted that 5 Whys later usually highlights the root cause.

In part because of its simplicity the 5 Whys have been criticized. Indeed Teruyuki Minoura, former managing director of global purchasing for Toyota, has stated that the tool was too basic in analyzing root causes to the depth that is needed to ensure that they are fixed.

Acknowledging the criticism I still remain a fan of the 5 Whys methodology. As I said before it is simple! Additionally, because it forces the participants to keep asking questions it helps drive a better understanding of problem solving particularly when identifying root cause issues. Rather than employees accepting an issue at face value the methodology essentially does away with  the notion of "face value" and replaces the issues with a deeper understanding of a specific problem.

As I have stated on numerous occasions, there are a plethora of management tools available to the business sector. Utilise these tools at your own discretion but remember if you do not ask the right questions you will not find the right answers. Unless of course you believe your business can run on good luck. In that case, good luck!

Monday, January 30, 2012

Experience matters as a matter of FACT!

"I went to a man with a high reputation for wisdom -- I would rather not mention his name; he was one of the politicians -- and after some talk together it began to dawn on me that, wise as everyone thought him and wise as he thought himself, he was not really wise at all. I tried to point this out to him, but then he turned nasty, and so did others who were listening; so I went away, but with this reflection that anyhow I was wiser than this man; for, though in all probability neither of us knows anything, he thought he did when he did not, whereas I neither knew anything nor imagined I did." Socrates (as described by Plato)

Over my time in the corporate world I have seen time and time again decisions based on 'half truths and total nonsense'. This is driven out of two key areas, namely:
  1. A lack of facts
  2. Ignoring the value of experience combined with facts
It is important to distinguish long term career experience with evidence based management. I am a huge proponent of actual hands on career experience and not simply text book practice. I believe the intellectual property (IP) that is built over a person's career is incredibly valuable. Without facts or evidence these "experts" are called upon to provide their wisdom for a given decision. Although the IP is valuable the lack of facts can significantly impact the outcome of the decision.

It is also important to remember that not all facts are right. They are merely facts after all. It is the interpretation of the facts as part of a detailed evidence based management approach that creates the value in the facts. This is where leadership springs to the fore. I have found those people who exhibit genuine leadership skills are not only excellent listeners but more importantly are willing to embrace alternate points of view. When undertaking a fact based approach to decision making leaders will need to balance the IP of the "experts" with the accumulated facts. This is not easy as, as I previously stated, the IP can be in incredibly valuable, however it can become destructive particularly when the experts begin to ignore the facts. I am certain many of you will have come across management who have been described as "stubborn", "stuck in their ways", "road blocks". The greatest buggy whip maker of all time would have limited value if they had not transitioned their skills on the arrival of the automobile.

Likewise it is critical that the experts are not simply ignored because they are deem "past it". This is where generalist Management Consultants can be so dangerous. The corporate landscape is littered with detailed analysis gone wrong. Here consultants with no industry experience provide recommendations to a company based on the facts accumulated. However these facts often ignore the "voice of the expert". The value of the IP exits the building in the face of the smart guy paper. Again here is where true leadership is bought to the fore. In the book 'Hard Facts Half Truths and Total Nonsense' Pfeffer and Sutton state "Executives have fallen into the habit of relying on consultants to reduce complexity and to do much of their hard thinking...The essential tasks of leadership cannot, or at least should not, be subcontracted. Building an evidence-based perspective into how people think and operate is among the most crucial of these tasks."

To assist with this, it is important to remember that whether you are a small business operator or CEO of a larger corporate, it is critical to acknowledge that a fact based management approach is not only the domain for Senior Executives. Again, Pfeffer and Sutton put it best when they wrote, "The best organisations are places where everyone has permission, or better yet, the responsibility to gather and act on quantitative and qualitative data, and to help everyone else learn what they know."

So the next time you are part of a decision making process where interpretation of facts is critical, try to remember:
  1. Hope is not a strategy
  2. General statements are generally wrong
  3. Knowing a lot of facts is not the same as being smart.
..... and that is a fact!