Paul R. Harvey

Sunday, 26 July 2009 20:00

Here today, here tomorrow

Businesses looking to slice and dice the budget walk a fine line between meeting short-term goals and driving the organization into long-term pain. When evaluating departments, people and programs for downsizing or outsourcing, there are difficult questions to consider.

Employee training and development is one area that deserves an extra-careful review.

“Variations in cash flow sometimes make it difficult to stay focused on the need for continuous training,” says Thomas Stewart, the vice president of workforce solutions for Tampa Bay WorkForce Alliance. “But you can see a direct correlation to an investment in training and a business’s health and ability to stay solvent.”

Smart Business spoke to Stewart about why an investment in ongoing training, even in a tough economy, will foster employee loyalty, increase capacity and help attract and retain top talent.

How can businesses successfully use training as a talent management tool?

Businesses are in constant change; they have to be to survive. The skills that are necessary to keep up with the changes in that business are ongoing. Businesses that train employees are also in a better position to manage employee performance. Based on the training that they’ve provided, businesses can specifically lay out performance expectations and build a culture of excellence. You can align training with a pay-per-performance type of culture and manage talent by demonstrating to employees that they are a valuable part of the organization and that you wish to continue to invest in them. If an employee feels like their interests are being served, as well, then the loyalty to the organization tends to be higher.

What are the main benefits of implementing ongoing training?

Ongoing training sets a culture for expectations. Having a culture of ongoing training is critical in setting the expectations. It gives employees the knowledge base to be able to take care of customers, fix computers, work with software applications — a whole host of things. The training culture can really begin when the employee is coming on board, when that initial orientation can set the stage for an expectation of continuous training. Sometimes ongoing training can be an internal function, as well — a sharing of information between departments and employee to employee, like a cross-pollination of knowledge within the organization. Most companies realize that if an employee is not sharing something they know, it becomes a liability. But part of that depends on the individual’s perspective, as well. If an individual feels threatened that they’ll lose their job if they share their information or if somebody else knows what they know, that can be a discouragement to share information. But if they feel recognized and valued because of their willingness to share information with others in the organization, then they’re more inclined to do so.

As businesses scale back to meet the current economic situation, how can they maintain a focus on training?

That’s perhaps the most difficult question to answer, because in the midst of the storm, as you’re trying to control costs, training tends to be one of the first areas to be cut. One of the elements in the balanced scorecard is learning and growth, but often, businesses will cut out that learning and growth piece in order to meet their financials. That may work for the short term and may keep the financials on track, but over the long term, it may impact employee retention as they start looking for opportunities in other areas. Ultimately, you become less competitive in the marketplace because employees do not have the skills necessary to remain effective or efficient.

What types of resources are available to Tampa Bay businesses or HR managers?

There are various work force organizations that can work directly with your business to determine your training needs, and then find areas where they can help. Some programs may pay for a portion of the training costs for workers to help them gain the skills to make them more competitive and increase their value to the organization. Consultants can also look at what’s available in the market as far as training resources and offer advice about what’s available in terms of training capabilities, and they can also serve as HR resources to help small businesses with their recruitment and training needs.

In this economic climate, looking for more cost-effective delivery tools for training requirements certainly helps you become more competitive. Some on-the-job training programs will offset the cost of training and help businesses develop their employees.

How does ongoing training help companies build a work force that reaches high levels of productivity?

As a business grows, it’s essential for employees to grow and adapt their skills. Continuous training is essential to be able to keep employees not only competent in what they’re doing today but also competent in what they will be doing in the future. The culture of training becomes a critical element to be able to retain the most competent and loyal employees.

Thomas Stewart is the vice president of workforce solutions for Tampa Bay WorkForce Alliance. Reach him at (813) 930-7559 or Stewartt@workforcetampa.com. Tampa Bay WorkForce Alliance’s Competitive Edge Award (CEA) training program is available to companies in the Tampa Bay area. The CEA offers one-on-one training for your existing work force, and it enhances skills that make the company competitive in the marketplace. For more information, visit www.workforcetampa.com or call (813) 930-7570.

Thursday, 26 March 2009 20:00

Filling in the blanks

When layoffs occur, those who remain on the job often are labeled the “lucky ones.” But when the dust settles most job-cut survivors actually may be feeling anything but lucky. Often they may be experiencing guilt, anxiety and mistrust. Left unchecked, the lingering short- and long-term effects of layoffs, mergers and acquisitions lead quickly to additional turnover of core employees. That’s why managers charged with reassembling and refocusing these remaining players have to act fast.

“It’s easy to focus on the latest unemployment numbers, but there are people left behind who are greatly affected, as well,” says Anthony Van De Wall, human resources manager, Tampa Bay WorkForce Alliance. “There will always be anxiety when you’re talking about job cuts, but armed with information, people will function and rise to the occasion.”

Smart Business asked Van De Wall about layoff survivor guilt, crucial first steps and methods to build a culture better prepared to withstand corporate change.

Why do layoff survivors often exhibit a negative set of emotions?

Employees who survive layoffs often are waiting for the other shoe to drop; they are afraid they may be affected by further cuts. And survivors may be torn between their loyalties. They have a sense of loyalty to the company, but they also have loyalty to their departed colleagues. The survivors may begin to question their own commitment and contribution to the company, thinking, ‘Why should I continue to contribute to this organization or commit to it on the level that I have, when they’re not beholden to me and I might be the very next person to go?’

How should managers first approach layoff survivors when their colleagues are gone?

There’s a saying, ‘In the absence of information, we fill in the blanks.’ Left to our own devices, we rarely fill them in with good things. There is no such thing as overcommunicating in this situation. The sense of trust that employees may feel has been shattered. You can regain this trust by communicating what you can as quickly as you can. When employees begin to feel that their employer is making the right decisions for the right reasons and sharing that information with them, it’s easier to come to grips and understand some of the hard decisions being made. It’s a good idea to have some sort of barometer as to how people are thinking. Focus groups, surveys and town meetings are forums that allow people to express their ideas, their anxieties and possible solutions. And when you get this data, you need to communicate it back to them.

What are some lingering effects of layoffs, and when do they manifest?

Changes can play out in the days, weeks, months and sometimes even years that follow a layoff and there’s going to be implications for all parties involved. Initially, there’s the guilt that some employees feel because they survived the layoff and someone they worked with for many years did not. There’s also the reality of the day-today increased workload and possible trust issues when people find themselves working in the midst of a new team, or mistrust among people who have worked together before but worry about whether a colleague is going to try to outshine or outperform them for survival.

What practices can mitigate the stress of a survivor’s perceived or real increased workload?

The managers have to step up to the plate to bring focus back to the workplace and get everyone back on the same page, involved with problem solving, solutions, collaboration, helping with prioritizing and redirecting the assignments of the department and the group overall. You should communicate to the employees the opportunities that exist to identify efficiencies, redundancy and innovation, while maximizing resources. Those are positive thoughts and processes, so people likely will be more focused on their function and responsibilities, not on what they’ve lost, and you’ll be able to stay on track. This may be a great opportunity to identify hidden talents within your quiet leaders.

How can companies better manage their culture to minimize the impact of job cuts?

Strong leadership is the best tool for building a culture that can support and survive downsizing. Strong leaders communicate, early and often. You should always be in control of the message from the top down, making certain everyone is on the same page. If you’re on top of that by getting the information out early and upfront and in a straightforward manner, you’re going to cut down on the rumor mill, and you’re going to cut down on the anxiety levels that are there.

The best investment to be made is the investment in building employee and customer loyalty. How do you do that? You need to develop humane and sensitive managers who are effective communicators and leaders. Remember, you’re not managing departments; you’re managing people who make up those departments, and with people comes emotions and feelings.

ANTHONY VAN DE WALL, PHR, is HR manager with Tampa Bay WorkForce Alliance. Reach him at vandewalla@workforcetampa.com or (813) 740-4680.

Monday, 23 February 2009 19:00

Taming change

Managers who launch a change initiative based on the tidy, sequential and well-defined path described in textbooks often see the initiative fizzle and fail. In practice, change in today’s intricate marketplace is usually squeezed from many sides by transparent and uncontrollable forces.

Unwary change leaders can be blindsided by the unpredictable nature of change. Three issues commonly cited as unexpected roadblocks by change managers are inadequate support for a change, failure to define expectations and goals early in the process, and failure to involve everyone who ultimately will be affected by the change.

“Effective change management entails an understanding of the effects of the change on the business and the effects upon people and how to mitigate potential sources of resistance to that change,” said Tom Stewart, vice president of WorkForce Solutions, Tampa Bay WorkForce Alliance.

Smart Business asked Stewart why customers expect change, how to lessen employee stress throughout change and why change management is critical to creating a positive long-term change atmosphere.

Why is successful change management a strategic imperative for organizations?

In today’s marketplace, change is an ongoing necessity. According to a 2007 survey by the Society for Human Resource Management, 82 percent of companies had planned or implemented major organizational change in the prior 24 months. As evidenced by the survey, you must constantly change and evolve in order to grow and not remain stagnant. In order for your company to be successful, clients need to feel they are receiving not only good service but the latest and greatest service at all times. To meet these demands, businesses must be in constant evolution. Effectively managing the dynamic business environment necessitates both vision and fortitude to quickly respond to change.

What components of change cause anxiety, and what missteps feed this anxiety?

Change management entails understanding the transitioning of individuals through the phases of the change while strengthening the organizational development initiative. In order to effectively strengthen your organization through change, it must be properly managed to avoid any barriers. On an individual basis, fear of the unknown is really what causes the greatest anxiety. While the real concern may be, ‘How will this change affect me?’ or, ‘Will I lose my job because of this change?’ often it manifests itself as an intense resistance to upcoming changes. Thoughtful planning and communication is an imperative to relieve that tension and foster successful organizational change. Missteps can and will occur if the essentials of change management are not closely addressed. Failure to allow for thorough development, constant communication and collaboration across all lines of business will only feed in to the anxiety some may feel during a major organizational change.

What are the first steps to introduce the change initiative and gain employee buy-in?

The ADKAR model, developed by Prosci, for individual change management is an exceptional tool. The model describes the required building blocks for change to be realized successfully on an individual level. The building blocks include Awareness of why the change is needed, Desire to support and participate in the change, Knowledge of how to change, Ability to implement the change on a day-to-day basis, and Reinforcement to sustain the change.

When deploying a major change in your organization, a critical first step in change management is organizational awareness of the reasons for change. At this step in the process, communication at all levels is paramount to achieving true change. Awareness allows your employees to buy in to the change initiative, which is a necessary building block to achieve desire from employees to change. Resistance is a natural reaction to change, so achieving awareness to develop a desire to actively support and participate in the change itself is critical. During these initial stages, constant communication is needed to achieve employee buy-in for the change initiative to be a success.

How can forums facilitate change?

Dictating change from the top down is the easy way to go about change. Employees from all levels should be brought in to feel like they are part of the change. Employing focus groups allows you to tailor change ideas to what would work best with their practices and how to best implement the changes. Facilitating the communication of the change by making the employees feel like they are part of the change process is the only way to get true employee buy-in.

How can leaders make their company more change-friendly for future initiatives?

Creating a positive change atmosphere, where individuals see change as not only for the improvement of the organization but also for the betterment of themselves as employees, will make future change initiatives relatively easy. Showing employees that change shouldn’t create fear or anxiety enables your company to not just adapt to future change, but also thrive from change.

TOM STEWART is vice president of WorkForce Solutions, Tampa Bay WorkForce Alliance. Reach him at (813) 930-7559 or stewartt@workforcetampa.com.

Tuesday, 25 November 2008 19:00

Cleared for takeoff

When leaving the runway for a first-ever solo flight, nervous and excited flying students can only trust that their instructor provided all of the skills and knowledge required to fly the pattern. But even if you hired the best candidates, if you’re not willing to be “in the plane” with them, teaching them everything they need to be successful, there’s a good chance they’re going to be in for a bumpy landing.

“When you hire peak performers, the tendency is to share with them what they need to do, and then leave them alone to go do it,” says Dr. Victoria Halsey, vice president, Applied Learning, The Ken Blanchard Companies®. “This has an incredibly negative impact on new hires.”

Smart Business recently spoke with Halsey to learn more about how to accelerate the productivity of new hires through coaching, creating effective relationships, and understanding how they best learn.

What early steps can help set up new hires to succeed more quickly?

What people don’t realize is that new hires may be very excited to be there, but they are actually brand new at the bulk of what they’re working on. In Situational Leadership® II language, we call them ‘enthusiastic beginners.’ To ramp people up more quickly, you need to rapidly focus them on the most important things they need to do and when, and then help them get with others who are also going to teach them how. They need a comprehensive on-boarding and action plan with examples of what a good job looks like, clear timelines and priorities. It’s also important to help them develop the relationships that will accelerate their growth and share ‘how we get things done around here.’

How do supportive and directive behaviors propel learners past the disillusioned learner phase?

New hires encounter a second wave a few weeks after the initial ‘Bring it on, I’m so excited’ phase. They hit the wall thinking, ‘Wow, this is trickier than I thought.’ Now they need someone there to coach them through their flagging motivation.

When they are feeling discouraged, they need to know ‘why’ what they are doing is so important. They need praise for their progress and either reteaching or redirection to build competence.

What are the benefits of teaching the Situational Leadership® II model’?

One of the benefits of teaching the Situational Leadership® II model to new hires is to have them see the stages of development they’re going to go through as they learn to be proficient in their tasks and goals. They need to know that when they first take on a task, they’re going to be excited, though may not know what to do — but then someone is going to give them very meticulous direction. They also need to know that they’re going to become a ‘disillusioned learner’ and receive coaching. They need to know they’re going to reach a time when they can do what it is they’re striving to do but not feel fully confident about it, so someone is going to help them with a supporting leadership style to help them step into their power.

Why should new hires learn to say, ‘I need’?

You should be teaching new hires to come to you and ask for what they need. The Ken Blanchard Companies’ research shows that 54 percent of managers tend to use just one style naturally before training, while 34 percent use two styles, 11 percent use three styles, and only 1 percent of the population use all four leadership styles. One reason new hires aren’t brought up to speed as fast as people would like them to be is that leaders aren’t giving them the specific direction they may need because it isn’t the natural style of the leader. New hires can help managers to flex their leadership style to both directive and supportive by learning to say, ‘I need.’

How can leaders diagnose others to best accelerate the development of new hires?

Developing optimal performance means knowing your people. Great leaders switch their attention from what they feel like doing when their people say, ‘I need help,’ to thinking about the person and the specific task or goal. Great leaders discover what people really need in terms of direction and support to move to the next stage, and then follow through by giving it to them. Finally, great leaders notice the good things people are doing, find what’s unique in their people and call it out with specific, descriptive praise. What is their goal? To make people feel brilliant and have early wins.

VICTORIA HALSEY, Ph.D., is vice president, Applied Learning, The Ken Blanchard Companies in Escondido. Reach her through The Ken Blanchard Companies Web site at www.kenblanchard.com/halsey.

Tuesday, 25 November 2008 19:00

Risky business

Some boards of directors may be facing some of their biggest challenges of the last 20 years. While it’s too soon to predict what, if any, litigation or increased oversight will be brought into boardrooms in the wake of the recent turbulence, it is clear that boards must move forward with an elevated sense of responsibility.

“So far, there has been relatively little focus on the role that boards may or not have played in the financial crisis,” says James Tompkins, Ph.D., director of Board Advisory Services, Corporate Governance Center, Coles College of Business at Kennesaw State University. “However, the fire is still burning fiercely, and once the dust settles, it is likely that board processes or activities will be heavily scrutinized.”

Smart Business recently learned more from Tompkins about the dangers of subsidizing risk, the benefits of skepticism, and why self-assessments will keep boards operating in the best interests of the company and its shareholders.

What dangers should be considered when subsidizing risk?

Consider the following scenario: Suppose I tell my 12-year-old daughter that I will contribute half the cost of her iPod if she ever damages it. With such a subsidy, she might choose to take her iPod to the pool and risk getting it wet. Conversely, if she bore the whole cost, she may prudently decide to leave her iPod at home whenever she swims.

Similarly, if a corporation bears risk to reap the expected returns, it will more likely make prudent decisions. However, if the government subsidizes the risk in any way, this can alter the decision-making of corporations in a perverse direction.

In my view, as we move forward with the financial crisis, a key principle of government regulation should be to ask the question: Does this regulation in any way subsidize risk? If the answer is yes, the next question should be: Is subsidizing this risk in the best interests of the taxpayers as a whole?

How can boards best manage their purpose of protecting stockholder interests and their responsibility of monitoring risk?

The purpose of a board is not just to protect but also to promote stockholder interests. Shareholders finance corporations to take risks in their areas of expertise. Hence, management promotes shareholder interests by engaging in such risks on behalf of shareholders. However, part of prudent risk-taking means that the board should have a big-picture understanding of the risk being taken and processes in place to both measure and monitor such risks. Such processes are consistent with protecting shareholder interests. An analogy might be when a shipping company sends a ship to sail from A to B because engaging in this risk is expected to reap returns to the shareholder; management promotes stockholder interests when it risks this voyage. However, shareholder interests are protected when there is radar on board and an instrument to receive weather maps so the captain can change course to avoid dangerous storms.

Why is ‘healthy skepticism’ a key trait for today’s directors?

I would argue that a key reason in which the board of Enron played a role in its collapse was because it did not employ ‘healthy skepticism’ in meeting its responsibilities. I recently served as a corporate governance expert witness for an Enron lawsuit, and my observation was that, as individuals, the directors of Enron were all highly successful, intelligent and talented people. However, they were also on the board at a time when the executive management at Enron — Lay, Schilling, Fastow — were being lauded for their leadership and accomplishments at Enron. This can make it very tempting for board members to fall asleep at the wheel and become complacent with their responsibilities. In other words, I believe they became too trusting of management and did not provide rigorous oversight and monitoring. A board that does not employ ‘healthy skepticism’ in meeting its responsibilities is not providing the constructive and rigorous oversight and monitoring required to achieve its purpose.

Can directors use self-assessments to gauge their performance around interaction, independence and integrity?

Yes, it is a best governance practice to have procedures in place to evaluate the board as a whole, the committees and even individual directors. In partnership with other governance centers, our center recently released ‘21st Century Governance Principles for U.S. Public Companies’ that addresses all these questions, including: Is the board’s interaction effective? Does its interaction result in communications that promotes good decisions? Are the vast majority of directors not only independent, but also independent-minded? Do directors have unblemished records of integrity? These are all questions that will promote and protect shareholder interests. A prudent board will conduct such evaluations with the goal of serving in an environment of continuous improvement.

DR. JAMES TOMPKINS is director of Board Advisory Services, Corporate Governance Center, Coles College of Business, Kennesaw State University. Reach him at (770) 499-3326 or jtompkin@kennesaw.edu.

Sunday, 26 October 2008 20:00

Core skills for new managers

Senior leaders struggle to provide new managers with the operating framework they need to make sense of the world they face when stepping up from subject matter expert and individual contributor to the realm of management and leadership.

“The challenge for new managers is to be able to work effectively in differing contexts that sometimes occur in the same day, for different lengths of time, with different priorities or risks attached,” says Richard Egan, senior consulting partner, The Ken Blanchard Companies®. “The result is that new managers, with good intentions at heart, do what comes naturally or imitate the leadership style observed in other leaders.”

Smart Business learned more from Egan about three key contexts faced by new managers and described in the book, “Achieve Leadership Genius,” by Drea Zigarmi, Susan Fowler and Dick Lyles. Egan explained why new managers must understand that who, what, where and when you manage and lead should determine how you manage and lead.

What challenges are faced by SMEs moving into management?

An individual worker or team member focuses primarily on his or her job at hand. That job is usually one in which he or she has received extensive training and is a proven subject matter expert. These workers also are passionate about their chosen field. On becoming a new manager, they often find themselves in fast-paced, changing circumstances — or changing contexts — in which they are required not only to continue to manage themselves effectively but to also manage others and lead.

What happens to new managers in the leading self context?

Self leadership is about having the skill and the mindset to accept responsibility and take the initiative for succeeding in your work-related role. The self context is the one in which new managers are most familiar as they have been excelling as individual contributors before their promotion. However, the challenge now is to use and apply the skills of being a self leader to the new role of manager and leader. These skills include aligning their personal mission, creating a personal performance plan that includes clarity of ‘key responsibility areas’ and goals, identification of needs for direction and support, and effective management of time and energy so performance and satisfaction are maximized. Self leaders also seek out a mentor relationship to help navigate the path forward. One common challenge for the new manager in the self context is to juggle new management and leadership responsibilities while continuing to make individual contributions as a subject matter expert.

When must new managers first handle more complex interactions?

This occurs in the one-to-one context. It’s more complex as it involves interacting with others who may be similar to or different from the new manager in terms of personality, skills, needs and motivations. A new manager may be required to perform various roles depending upon the needs of others and the immediate situation. The roles could include supervisor, teacher, coach, mentor or friend. Key skills in this context include: the ability to clarify roles, priorities and performance standards of others; impart knowledge and develop skills of others; manage the performance of and give feedback to others; and have challenging conversations with others when performance or behavior is not on track. A typical challenge the new manager faces in this context is to work effectively with others who were former peers, colleagues and friends. Moving from being one of the ‘gang’ to being the leader is sometimes a tricky transition that requires thought, intent and skill.

What is the most difficult context for new managers?

The team context is exponentially more complex. Here, the new manager is asked to galvanize a number of individuals all potentially with different personalities, skills, needs and motivations to achieve a common purpose. The focus is collective and the new manager has to work on maximizing two group constructs — team productivity and morale. A variety of roles may need to be performed including those of trainer, facilitator, mediator and cheerleader. Key skills include the ability to provide a team with structure such as purpose, tactics, norms, methods of communication, and the ability to manage group dynamics and manage effective meetings — both face-to-face and virtual. A common challenge new managers face in the team context is to lead cross-functional teams. This requires the manager to negotiate resource allocation from different departments, manage the performance of individuals on the team who report to a different function manager and develop the team as a whole when members’ allegiances may lie with their individual functions.

How can new managers increase their chances for success?

For new managers, developing effectiveness in the self, one-to-one and team contexts is the priority. If they can first diagnose the current context in which they are operating and then have a number of relevant skills to deploy, they will increase their chances of managing and leading effectively.

RICHARD EGAN is a senior consulting partner with The Ken Blanchard Companies in Escondido. Reach him through The Ken Blanchard Companies Web site at www.kenblanchard.com/egan.

Thursday, 25 September 2008 20:00

Data dilution

John F. Kennedy once remarked, “Leadership and learning are indispensable to each other.” And people have taken this philosophy to heart.

They attend lectures, seminars and night classes on a host of topics. They subscribe to cable television services that provide a nearly limitless smorgasbord of choices. They proudly report to their friends that they’re “on their third book this month.” And they surf the Web. But how much of this information really sticks? How much of it has an impact on people’s lives, either professional or personal?

“Very little,” says Dr. Dick Ruhe, a senior consulting partner with The Ken Blanchard Companies®. “And if there is a trend right now, it’s in the wrong direction. Now, we can get our hands almost immediately on anything that’s out there. The problem is there’s too much of it.”

Smart Business spoke with Ruhe about this tidal wave of information and what to do about it. He recently coauthored “Know Can Do!” with Ken Blanchard and Paul J. Meyer. The book deals head-on with the challenge of getting things to stick.

What are the three reasons people don’t learn?

The first is ‘information overload.’ There is simply too much coming in. People either don’t focus, or can’t. The mass of data dilutes any one piece of it. We don’t need more breadth, we need more depth. The second is ‘negative filtering.’ People close their own minds through negative thinking. They critically question all new ideas. Such evaluation is helpful, but too much of it is crippling. The third is ‘lack of follow-up.’ The research is clear that even when people successfully incorporate fresh information into their thinking, it rapidly goes away unless used very soon.

Can less actually be more when it comes to reading and learning?

One of the problems that people have with knowledge is they keep wanting to know new things. Who wouldn’t want to be in the group that wants to know new things? Besides, they actually don’t have a choice. We already know that most people spend the majority of their communications time reading and listening, rather than writing and speaking. So there is a nonstop flood of information coming in. People complain about being buried in it.

The problem is that people can only emphasize a few things. Those who try to emphasize everything emphasize nothing. In order to take advantage of new information, we have to reduce this flood down to the ‘critical few.’

The book mentions Green Light Thinking. What is that?

Not only are people themselves hyper-critical, but they are surrounded by wet blankets. When approached by others with ideas, there is a natural human tendency to look for what is wrong or at least the major obstacles to adopting a new order of things. A limited amount of this is OK, but too much reduces any chance of running with a new approach or solution.

We suggest holding people accountable for Green Light Thinking. Before they can say anything negative about something, they must identify reasons and solutions that support it. There will be plenty of time later to coarse- or fine-tune the recommendation. During meetings it can make sense to literally assign someone to be the Green Light Thinker. The person becomes the advocate and contributes the optimism and positive mindset that often are missing.

How can you change the energy level people have to do things differently?

An essential ingredient in making change happen, any kind of change, is ensuring that there are positive consequences in place. Whether it’s for others or for ourselves, there must be a conscious or subconscious association of good things with the initiative. Energy includes drive, motivation, attitude, inspiration, enthusiasm, etc. All of these have a strong positive correlation with positive consequences. If you go on a diet, recognize progress — any progress. If you are trying to adopt a new problem-solving system, celebrate success in moving forward.

How does the concept of unconditional love come into play?

This is quite related to positive consequences. People get so accustomed to trying to do better, they actually don’t even see the improvement; they only see where they could have done better. So they pre-dispose themselves to a critical, negativistic attitude. In ‘Know Can Do!’ we suggest ‘catching people doing something right.’ Many people go through their whole lives trying to finally get approval from important others who may not even be with them any longer — parents, teachers, coaches and so on. There isn’t enough unconditional love. If there were, there would be less dissatisfaction and depression and more good in the world.

DICK RUHE is a senior consulting partner with The Ken Blanchard Companies. Reach him through The Ken Blanchard Companies Web site at www.kenblanchard.com/ruhe.

Wednesday, 25 June 2008 20:00

Building a team of leaders

When companies need to develop high-performance leadership, they turn to professional development programs. But when organizations settle for a one-size-fits-all plan to develop future leaders, they can end up with a mishmash of people who may never be capable of moving up to higher positions.

Weak professional development programs can have other negative effects.

“If a good program is not put in place, you get low morale, because if everybody can get accepted to it, the quality of the program gets challenged,” says Dr. Stephen Brock, D. Min, LPCC, RCC, of Coles College of Business. “People start looking at it as the flavor of the month, and they don’t take it seriously.”

Smart Business recently spoke with Brock about what you should put at the core of an impactful professional development program and how the right frequency and accountability for learning can produce the best results.

Why can it be difficult to select useful professional development programs?

It’s difficult to choose an effective program because many don’t have a lot of teeth at their core — they tend to be oneor two-day mini-retreats or workshops. Often, the programs are superficial — either too short or not based on an experiential model of adult learning that requires people to take what they’re learning and go use it, and then come back and talk about what worked and what didn’t work. Another problem occurs when they don’t focus on the different core competencies needed by the business.

A third issue is most programs focus still on weaknesses rather than strengths. Companies tend to do assessments and then look for a gap analysis and focus all the attention on people’s weaknesses rather than attempting to help them leverage their strengths. A final difficulty is the selection or identification of participants. Many companies today still do not have any succession planning in place. They don’t look at future needs and then look at the pool of resources they have that might meet those needs.

What makes up a good professional development program?

There are five elements in a good program. First, a good professional development program has a number of assessments used throughout the program to help individuals understand truly what their strengths, assets and liabilities, and vulnerabilities are in terms of their work. The second element is it needs to be based on a solid leadership model. There are lots of leadership models out there — many of them a variation on a theme — and several are excellent models to build your program around. A third element is that it should be experientially based with homework, meaning it’s not just sitting and taking notes and then ignoring them. There has to be something you are actually executing between sessions, no matter how frequent the sessions.

I also believe the program has to include training in and involvement with coaching and mentoring. I think every manager and every leader needs to understand how to coach and mentor others for their professional development. A good manager or leader is always working to get his or her people growing. Finally, the program has to be frequent enough that people feel the level of accountability for learning.

How does an effective program benefit the organization?

The first benefit obviously is that you have a pipeline of people who are going to be prepared to move up when people exit due to age or opportunities elsewhere or as the company expands, grows and develops the need for new leaders. At the same time, you may have two or three outstanding people who are prepared to take leadership roles so, if one exits the company, you’re not losing anything. Additionally, with an effective program, turnover immediately begins to decrease and the amount of time it takes for the company to make an adjustment is lessened — quite a cost savings, particularly as people move up into the higher positions.

What is the role of mentoring or coaching around professional development programs?

On the mentoring side of it, for example, you can put a fairly novice person in a leadership position with somebody who’s more seasoned. As a result there’s a lot of learning that can be passed from generation to generation through experience. That’s a quick cost savings when people don’t have to go burn their hand on the stove because somebody else already did and they learn from that person.

Coaching has demonstrated it can be quite an asset to helping people develop because you’re not giving them answers — you’re inviting them to make plans and set goals, and then you’re holding them accountable for the results. IBM, for years, had a coaching program that was considered state of the art. There is even a number of small companies who employ coaching to help their employees develop better skills and competencies in particular areas the person is interested in understanding.

DR. STEPHEN BROCK, LPCC, RCC, is a professor of leadership at Coles College of Business, Kennesaw State University. Reach him at (678) 231-3812 or stephen_brock@coles2.kennesaw.edu.

Wednesday, 26 March 2008 20:00

The science of entrepreneurship

Statistics have long confirmed that nearly 80 percent of all start-up ventures never make it to their fifth anniversary. The upside to these failures is the plethora of case studies available for review; information that holds the key to pumping a new venture’s success rate up closer to 50 percent. For instance, a long-term review conducted by Ph.D. students of 200 successful start-ups revealed that not one of them had gross margins lower than the average of their industries.

“In a start-up venture, you presumably have something that nobody else has,” says Dr. Charles Hofer, Regents Professor, Coles College of Business, Kennesaw State University. “Now, if you can figure out who your customer really is, they’ll pay the premium prices required to sustain a successful start-up.”

Smart Business asked Hofer about how to avoid the most common start-up traps.

What are the top three marketing and financial mistakes for new ventures?

There are several mistakes made by prospective entrepreneurs regardless of industry. The most significant of these include charging too little for the products and services, failing to create ‘just noticeable differences’ in your products and services that differentiate them from the products and services offered by your competitors, and failing to limit the credit extended to customers and monitor accounts receivable closely. A sale does not occur when you ship products to your customers; it occurs when they pay you. Since the gross margins on most products are less than their full costs, this means that it may take two or three ‘good’ customers to make up for just one ‘deadbeat.’ Large companies operating well above their breakeven points may be able to afford to take such risks. Most new ventures that are working hard to reach breakeven cannot.

How are proper and sustainable prices determined?

There are three factors that must be considered in setting your prices. The first is costs. Except for overstocks of seasonal items, you must charge enough to cover the full costs, both variable and fixed, of the items you sell, which means that you must have an accounting system that provides reasonably accurate estimates of these costs. Second, you need to know what your competitors are charging for their products and services. This does not mean that you should match them. In most cases, you should not. But their prices may set an upper limit on how much more you can charge than they do. Most customers will be willing to pay a premium for products and services that better serve their specific needs — up to a point. That point will be determined by your competitors’ prices and the magnitude of the benefits that you provide. The third factor is the specific benefits that you provide that your competitors do not.

Won’t high prices limit sales?

Yes. But not as much as one might think if the new venture is pursuing the appropriate set of initial target customers. Having lower than average margins for your industry may be the ‘kiss of death.’ New ventures will do many things exceptionally well, but they will also make many mistakes, and high margins provide the resources needed to pay for these errors. Second, and more importantly, you should be providing benefits other than low prices to your initial target customers.

Where should new ventures first focus their marketing budgets?

Most new ventures should use variable and/or no cost marketing methods whenever possible since the lower you can make your breakeven point, the greater your chances for a successful launch. It is crucial that you identify and focus on those customers who currently have an absolutely compelling need for your product as well as the ability to pay for it. Seldom is this the largest segment of the market. The best way to do this is to talk with as many different potential customer groups as possible. Surveys will seldom, if ever, do the job. Once you have identified this initial target customer group, you need to develop a set of unique selling propositions built on the ‘just noticeable differences’ of your products. Wendy’s original ‘Where’s the Beef?’ advertising campaign was one such unique selling proposition that was built on the fact that Wendy’s had square burgers that could be seen hanging over the edge of the bun.

Can a new venture grow too fast?

Absolutely. In fact, one of the most significant problems for companies that survive start-up is growing too rapidly, which frequently leads to exceptionally poor customer service followed too often by bankruptcy. One of the best ways to control growth is to increase prices. Not only will this limit the growth in sales, the increased margins generated by such higher prices will flow directly to the bottom line and help pay for the additional resources needed to supply and service the additional new customers who are willing to pay the increased prices. Another way is to cut back on the various sales and marketing activities that generated the growth in sales. This is more difficult to do, however, and does not help identify those customers for whom your products have the greatest value and those who will pay higher prices to get them.

DR. CHARLES HOFER is a Regents Professor in the Department of Management and Entrepreneurship, Coles College of Business, Kennesaw State University. Reach him at (770) 423-6000 or chofer@kennesaw.edu.

Tuesday, 29 January 2008 19:00

It’s a wrap

Arecent survey of CEOs found their No. 1 objective is growth, followed closely by margin. In order to secure this growth, companies have to deal not only with the opportunity side but also with constraints of existing IT systems.

“Seventy percent of the CEOs cited IT as a key to growth, but 60 percent of those same executives said that IT is inhibiting growth,” says Bill Russell, executive vice president of Allegient in Indianapolis. “That’s because the existing systems and architecture do not have the flexibility to become agile and poised for speed or to drive customer value.”

Smart Business spoke to Russell about the shortcomings of legacy-based platforms and how companies are successfully “wrapping” these older systems with services-oriented architecture (SOA) to extract maximum speed and value as they modernize for their growth initiatives.

What symptoms indicate shortcomings with legacy-based platforms?

The main symptom occurs when you’re not meeting the new business solution time-lines. In other words, the legacy platforms actually become an inhibitor. The second symptom arises when a larger and larger share of your IT budget is going to maintenance because there’s a cost side to keeping those big, monolithic transaction systems running. Finally, companies are finding themselves stretched because the resident subject matter expertise is getting smaller and smaller. You’re probably dealing with an extraordinary retirement curve because most of the people who grew up supporting these systems are boomers with 15 to 20 years in, and they’re coming up on retirement. So where are you going to find support for these legacy systems?

What is the timeline for the end of legacy-based platforms?

I don’t know if we can talk about the end of these systems, but these systems as we know them today are probably going to have to change significantly within the next five or seven years due to their lack of flexibility, the boomer retirements and the absence of skilled resources to keep them optimized.

Why are there so many definitions for SOA?

There are so many definitions because SOA is a lot of things. It’s a strategy, it represents an organizational model, it represents a management discipline or method, it is an architectural approach to computing, and, finally, it is a technology platform with a set of technological capabilities. I define SOA as a new kind of a distributed, modular computing model that’s going to be utilized to become more agile, to speed up the applications that can be built, a way to reuse IT assets at a lower cost and a way to modernize against some of the older, existing platforms.

How are companies successfully transitioning into SOA platforms?

Companies are using SOA as part of their modernization strategy. The fastest way to do this is to look at a business problem and see whether the way to solve that business problem, if you’re going to use technology, is through a services-based approach. The emerging standards allow you to abstract parts of applications and/or parts of data services that can be published and consumed by other applications. This concept of composite applications means you can use a set of these published services, stored in a repository, to build a new composite application — and you can do it faster and cheaper. SOA also is being utilized as ‘wrappers’ for older legacy systems. You’ve probably heard, ‘We’re wrapping our legacy application in order to deploy it or utilize it as a service,’ or, ‘We’re wrapping a part of our legacy application or our legacy database and exposing it as a service to be utilized.’

What are the soft spots of SOA?

The fact is that some of the service standards are still firming. But major players like IBM, Microsoft and Hewlett-Packard are providing major horsepower behind the standards movement. The platforms to manage or govern the services you build inside your enterprise are also immature. The ultimate vision is that these services will be published outside your company for use by other organizations. This is still risky because federated security models are not as widely deployed as they will be, and outside-the-firewall services-based architecture is probably the most complex.

How is SOA architecture altering traditional business models and roles?

SOA is a new architecture, a new strategy and a new organizational model. It is changing many aspects of the IT and business world as they go toward this culture of agility and reusability. There will be new roles and new skills from both the business contribution and the technology side. Emerging business roles, like content developers, business rule developers, process modelers and scenario developers, will collaborate with the new technology roles, including composite application architects, service developers and service assemblers. When combined, this all new, collaborative SOA framework will deliver faster and better business value.

BILL RUSSELL is executive vice president of Allegient in Indianapolis. Reach him at (317) 564-5701 or brussell@allegient.com.