What "Type" Are You?

Greetings from San Diego. I have the opportunity to be out here and meet with a group of colleagues that I deeply respect to talk about new ways to motivate and work with people.

During my trip I have had a chance to catch up on a little reading and explore some of the work of two of my favorite social and business "system" commentators, Daniel Pink and Seth Godin.

My question comes from a model/theory that Pink explores in his book Drive -the surprising truth about what motivates us. Perhaps the reason I enjoyed the book so much is because what Pink describes and what I believe are in such close sync.

He also tees off on one of my favorite targets- Frederick W. Taylor, the "father" of scientific management. This is the theory that non management people are not terribly intrinsically motivated so productivity is best optimized by routinizing their tasks.

Pink's type "I" argues that at least some part of us is driven by needs for autonomy, learning, and purpose. He doesn't take the position that all work and all people fit this model, but that many do. He even goes further and uses the "P" word, Purpose and suggests that most of us seek this with varying degrees of energy. Kind of resonates with the concept of focusing on what "matters" doesn't it.

If you haven't yet read the book I commend it to you. In addition to stimulating your thinking he also provides some "templates" for both organizations and individuals.

Seth Godin's latest work - Linchpin is another fascinating read. He explores that a new category of critical "player" is emerging in organizations. Traditionally we had labor and management and the lines were pretty clear. Linchpins are those people who can connect groups and individuals.
Their skills are in communication, building trust, and relationships; not sciences or technology. Kind of sounds like they are building engagement doesn't it? He even uses words like obedience aka compliance and how we built it into our work and social systems and the costs we are experiencing because of it. I especially see this represented in the U.S. labor law infrastructure; most of it was written in the 40's and 50's with little meaningful change since. If you are familiar with it you know that it is highly structured and based on an adversarial model.

Any of you that know me or my orientation know that concepts like working with people, creating engagement, and related models speak to my heart; but I think anyone in any organization would benefit by exploring the concepts these two discuss.

One of my favorite quotes talks about "employees being physically, emotionally, and psychologically impelled. They gladly give up other choices."

Maybe it is just me, but that sounds pretty exciting. What do you think.....?

Do We Have A Leadership Crisis?

We are in an interesting time and as you know this whole topic of leadership is a passion of mine. I become especially concerned when we can use language like 'jobless recovery" with a straight face.

I had a chance to read John Baldoni's blog on Harvard Publishing-http://blogs.harvardbusiness.org/baldoni/2009/11/what_it_takes_to_lead_now.html and I have to tell you that it didn't provide me any comfort.

Baldoni references a recent McKinsey and Company survey citing that only 48% of managers believe that providing inspiration during the crisis is their job and 46% feel a responsibility to provide direction. Even more alarming the numbers drop to 45 and 39% post crisis. To make me feel even worse only 30% felt responsible for motivating their employees during the crisis and it drops to 23% post crisis!

Let me sum it up, less than 50% of the managers surveyed believe that inspiration, direction, motivation, and accountability are essential for managing corporate performance! I don't know about you, but that scares the hell out of me!

The defenders of course say that those are "senior management" or "executive responsibilities". They see their roles as tactical, gutting it out on the day to day. The problem is this is the "corps" of where that future leadership comes from. When does the age of enlightenment kick in and they recognize and develop their skills in these other areas.

When you add these facts to those including that 40% of "new" managers fail in their first 18 months on the job, usually for "non-technical" reasons, the costs of failures is estimated at between 2 and 4 times annual salary, and less than 30% of the organizations in the world have an employee engagement strategy it provides a pretty grim picture.

To quote Baldoni; "Execution without adequate leadership is short sighted. It will carry a company through a quarter or a year, but it will not provide a foundation for what organizations really need to do, and that is to grow."

I agree with Baldoni and also with Marcus Buckingham -
“Effective leaders don’t have to be passionate. They don’t have to be charming. They don’t have to be brilliant […] They don’t have to be great speakers. What they must be is clear. Above all else, they must never forget the truth that of all the human universals […] our need for clarity is the most likely to engender in us confidence, persistence, resilience, and creativity.”

A recent study by Rhoads and Whitlark also discusses that the crucial foundation for engagement (which by the way yields some wonderful byproducts in areas like productivity, sustainability, and profitability) is trust. Doesn't seem like we are moving the ball in the right direction.

I see time and time again where we seek to systematize leadership- to define it in terms of metrics and statistics. Looks like once again we are missing the point that it is relationships and people.

"Presenteeism" costs the U.S economy an estimated $200+ billion per year and a majority of our managers don't see the underlying issues that cause this phenomena as being their responsibility. We are in deep shit!

I guess these statistics say a couple of things to me:

• I am hoping that the organizations I am working with are represented in the 48% who "get it".
• We need to re-evaluate or management talent acquisition and development processes in a big hurry if we are going to have to make meaningful changes.

So I guess if I was leading an organization I would be asking myself - "Where is my management team on these issues?" and maybe even more importantly, " as a leader what am I doing about it?"

So I guess I have answered my own question- now I would pose one to you " Where do we go from here?" By the way, I wouldn't suggest turning this over to your HR department to fix. This is a key leadership issue.

Personal Accountability

This has always been an interesting topic to me. Some of the events of the last few weeks ranging from athletes punching one another out to kids returning to school seems to make it particularly relevant.

A colleague and I were discussing this topic the other day especially as it pertains to health care. Isn't it interesting for all the debate about whether there should be single payer, a public option, how much it will cost, etc. there is little discussion about the individuals role in the whole health care discussion other than as a beneficiary.

I have some pretty strong opinions on this topic. Among them I believe that all Americans should have access to a basic level of health care much like public education and that until we provide that the costs will never really be managed.

I also believe that individuals have a right and responsibility to participate in the management of their own well being and health. We don't talk about that very much. I would venture to say that the majority of Americans who have health insurance are also covered by a group plan- employer, government agency, association, etc. so they have little understanding of how much their health care actually costs and care less until it impacts them in the way of increased co- insurance, higher deductibles, denied claims, or related activities.

I have mentioned a couple of other related concepts regarding health care like our inefficient delivery and focus on the costs of processes rather than paying for outcome based management, but this is a different issue.

I remember years ago when a new employer arrived in town and declared a tobacco free workplace. People were outraged. How interesting? An employer who took the position that if you knowingly contributed to the detriment of your own health they didn't care to subsidize your real or potential higher expenses so they wouldn't hire you.

We tried to pass a law recently requiring all restaurants to post calorie counts for everything on their menu, luckily it failed. Would we want to extend that to homes like the dram shop laws?

Dram shop laws extend liability to private individuals for serving intoxicated people or allowing them to depart your home intoxicated without at least attempting to intervene. Can you see requiring a menu with calorie counts at dinner parties?

I think a big part of the issue is that of personal competency. Personal competency is that "other" right that constitution provides us with in addition to the concept of personal property.

When we began to industrialize and people left the "farm" many went to work for large employers. Large employers responding to both collective bargaining and offering competitive compensation began offering "fringe benefits" including paid time off, retirement and pension plans, and group health insurance benefits. A few years ago it was not atypical for employers to pay all the costs for health insurance for employees and their dependents. Employees had no idea and didn't care what they cost. Add these third party payer systems to advance health care techniques, technology, and a few other things and we created a trillion dollar health insurance industry, and very high expectations.

Very few employers to my knowledge even today talk extensively with their employees about ways they can contribute to lowering health care costs. The idea of "mandated" health screening, enforced wellness, and sliding employer contribution rates based on lifestyle health care costs would probably be seen as some type of corporate fascism. Your employer shouldn't be able to tell you how to manage you lifestyle, right? Even if they pick up the majority of the cost....

I believe until we address the personal accountability issue and employers
actively engage and educate their employees about the root causes of many of the costs we will only be addressing part of the problem. What do you think?

A "Healthy" Debate

I have been following the discussion and debate around our health care crisis and alternative solutions with particular interest. As a human resources practitioner and consultant I have probably been involved with health care in one fashion or another for thirty years.

The discussion of whether or not we should have a national plan is particularly interesting, as is the general debate on where the "fault" is for where we are at today.

I used the word crisis because I believe we really do have a crisis. Although I think we have some of the most sophisticated systems and processes in the world we have huge issues with our delivery system. It is also interesting to me how little the average person understands or aspires to understand the health care system.

I had a chance to listen to a HBR (Harvard Business Review) Idea Cast with Dr. Richard Bohmer the other day. It was probably one of the most succinct discussions of the issues with health care that I have heard in years. Dr. Bohmer points out that there are really are three major issues with our health care system in his mind: how we define a service, how we finance health care, and how we deliver health care. I found his discussion really valuable. He also gives a great explanation of the difference between managing health care which deals with defining and delivering services as opposed to "managed care" which he refers to as an insurance or financing model. I won't bore you with all the details, but I will tell you it is a value added 13 minutes to listen to his interview.

Health care is delivered and defined in his opinion currently as a series of separate events beginning with diagnosis and then proceeding through treatment and "follow up". He argues that health care delivery and costing should be based on outcomes rather than the way we currently track and price it. It is kind of like lean manufacturing or total quality; success is determined by outcome not process.

What I found interesting is most of the debate I hear is about providing access to care and financing, I hear very little about outcomes.

The other thing I find I hear very little about is the individuals responsibility in their health care. I don't mean just paying for it, I mean accountability for lifestyle choices and related activities that directly and indirectly affect health care costs.

Most of us have historically had our health care provided through our employer, our spouses employer, or in some cases the government. We pay a fraction of the real cost and understand the way it works like we understand Cantonese. The insurance industry doesn't make it much easier. For years health care was considered like paid time off a "fringe benefit". Then we noticed that the cost of that particular fringe benefit continued to go up at double digit rates long after wage inflation receded. By that time we had created an entitlement.

When this becomes particularly interesting is when we start to track connections. Jeffrey Pfeffer of Stanford believes (and I agree) that much of our health care related costs connect directly or indirectly to our work environment. If you are stressed about your job it effects your health. If you are stressed about your home life it effects your work. Some studies say it costs us $200 billion annually! In a shaky economy when you are concerned about losing your job and your health care benefits the problem accelerates.

I also believe at least at this stage there is little about personal accountability in health care delivery. We are suing Big Tobacco successfully for misleading advertising and withholding information about the addictive and health risks of smoking, but we are reluctant to reduce or deny care to smokers.

We want to label the calorie content in food, but do we want to deny or reduce coverage to those who have bad eating or exercise habits? Are we ready for employers to require wellness programs and screening as a function of company provided health care insurance?

Do companies educate their employees about things they can do to affect their health and the companies costs? Not many in my experience. Should we allow "tiered" coverage for people who deliberately practice behaviors that could or actually affect their health?

I don't mean to imply that as Dr. Bohmer points out "fixing" health care is a complicated issue, but should we be addressing personal accountability along with delivery, definition, and financing?r

To me this speaks of respect, engagement, and personal competency. What do you think?

Brands, Lighthouses, and other Icons

“Inside my empty bottle I was constructing a lighthouse while all the others were making ships”
Charles Simic

Last week as I mentioned in this blog I had a chance to talk with my sister in law; a very talented communications professional, about iconic brands, connections and related concepts.

We talked about what creates an iconic brand, she felt the elements include among other things:

A defining brand truth. Think about the concept of a defining brand truth. It articulates value statement not only to your customers, but also to your employees. It allows them to commit rather than merely comply.

• A set of in transient principles. Great brands refuse to compromise on their principles. They may change a process or a look, but they retain their essence. What they represent is foundational and consistent.
• Great brands are iconic. Think about great brands. Brands like Porsche, Mercedes, Xerox, Kleenex, McDonald's, Starbucks and others. They are a benchmark. Their "brand" is instantly recognizable.
• They create and reinforce an experience. Think about that. Great brands literally create expectancy. You don't just go there or dine there; you experience them in a variety of ways.
  
• They are inspirational and aspirational. As we have talked about with the new definition of engagement a great brand creates a pride of affiliation. Employees and customers take pride in their association with the organization; they champion the product or brand. They become benchmarks.
  
• Great brands are enduring. They continue to deliver value to their stakeholders; shareholder, employee and community.

We posted our thoughts on the popular social networking site and got some terrific insights and opinions from others as well. They ranged from brand as promise, to brand as purely a marketing tool or tactic. I think there is room for both.

There were also some interesting discussions about whether organizations start out striving to create an iconic brand, or iconic brands happen over time. I believe that iconic brands are deliberate. The “crafter” starts with a premise rather than just a product. I don’t think that can be created by a group of marketing professionals alone, no matter how talented. It must be planned and systemic. I also see a convergence between iconic brands and true engagement.
If you examine some of the things I have discussed previously in my writing about true engagement you come across Pepper and Rogers definition of the old engagement model: the intellectual, behavioral, and emotional model. At the intellectual level people (your employees and hopefully your customers) agree with your vision statement or brand premise. At the behavioral level they start to operate with a sense of brand loyalty, they seek out your product or service. At the emotional level they go further; they recommend you to friends and family.
Pepper and Rogers go on to describe new levels: the levels of best product or service, and the pride of association. To me that describes being a benchmark, and finally achieving almost cult like status. Does every brand seek or achieve that level- no, but I would submit that is what differentiates an iconic brand from a regular brand. Do we really believe that just happens coincidentally? Or that the marketing department can create that kind of affiliation by itself?
Pepper and Rogers also describe that this true engagement can only be built upon a foundation of trust, and that you will never enjoy greater engagement from your customers than you enjoy from your employees.
To be iconic, both your employees and your customers must trust you and what your brand represents. They go further indicating that a 2003 survey indicated that outstanding service represented the compelling “buying” decision in 51% of the consumers surveyed and over 80% indicated they would terminate a relationship because of a bad experience. So to a great extent your employees are your brand.
Is it just me or do you notice a significant degree of correlation between my sister in law’s elements of a great brand and Pepper and Rogers description of the elements of engagement? They both require a huge investment in developing and nurturing relationships.
You might be asking yourself – where are you going with this? Okay, I’ll get to my point. Our future is dependent on trust based relationships; not technology, not product innovation, but relationships.
I want to explore that through a couple of different avenues.

Exploring Engagement
In my last “corporate” job I was an executive with a financial services organization. As a credit union we really felt like we owned the market on the relationship thing. Credit unions like to point out- we are member owned. We have members, not customers. I remember being told we have 90,000 members. Being an outsider and therefore not very bright I asked – “how do we define members?” Boy, did that cause a shit storm!
It turned out that we defined “member” essentially as anyone who had an account with us. We were pretty bummed out when we applied metrics closer to the ones espoused by Pepper and Rogers and found out most of our members were not members at all, they were customers, and frankly not all that engaged.

We spent almost three and a half years developing and implementing an engagement strategy. It included all the elements that are included in both Pepper and Rogers and my sister’s model. We built it from the inside out. At least for a period of time we enjoyed the fruits of that endeavor, we went beyond a financial organization to creating true engagement with the financial metrics to validate our claim. I won’t bore you with the details. If you are interested they are available in my previous white paper- New Paradigm for Credit Unions. I can’t say whether they have transcended the boundary to iconic or merely enjoyed an interlude. That is for others to judge.
One of the other models I would like to examine is my sister in law’s iconic brand. I won’t specifically identify it, but I assure you, you would immediately recognize it. They have taken it beyond a beverage to creating affiliation and brand loyalty. They aspire to do that with other brands they own and manage. They are doing that through a systemic multi faceted approach that includes both external and internal branding.

A Call for a New Leadership Foundation
In the credit union industry and in fact across financial services we have looked for our “leadership” and new strategies to come from two primary areas- finance and operations. I think if you were to examine the career paths of the vast majority of CEOs in both banking and credit unions you would find that one of those disciplines represents their career path. In fact as a culture I think the U.S. is much more comfortable with leaders coming from these “hard” disciplines. We revere technology and product. We tend to shy away from relationship based strategies. Our labor relations legal infrastructure is in fact one of the most archaic and adversarial in the developed world.

Our top business schools also tend to focus much more on “operational” and financial skills rather than communications and the skills around building trust and engagement. Current headlines are screaming that the MBA degree is largely responsible for the current financial crisis and demise of so much of our economy. How interesting that we absolve ourselves of any responsibility for reinforcing that culture through our hiring and succession planning activities.

I will go out on a limb and make myself even more unpopular by stating that much of what we teach would it in what my colleague Ty Warren would describe as “mapping” skills. We claim to revere leadership, but we teach and reinforce mapping.

I have found that most traditional approaches to engagement are focused almost exclusively externally. We measure customer reaction, loyalty, and satisfaction. We spend billions in crafting marketing campaigns and strategies to capture them. I also find it interesting that the first two areas that organizations usually cut in financially stressful times are marketing and training- the relationship building things.
A few years ago I took a position that the most important “management” functions in organizations were going to be marketing and human resources management. I stand by that premise today and I would like to take through my argument as to how true engagement represents the appropriate hybrid of both disciplines.

A New Solution
It is easy to blame the unions or the business schools for where we are and how we got there, but the real issue is the American labor relations model which requires the negotiation on the effects of technology, but not its implementation and the traditional model of capitalism which rewards the shareholder at the expense of the stakeholder. Both are both huge contributing factors. I would submit that the codependency that accompanied moving from an agrarian to an industrial society contributed as well. We abandoned personal competency. The model almost makes engagement in that setting impossible.
It is still interesting for me today to talk with employers and individuals about the “systems” that are going to facilitate our recovery from the current recession. We are still looking for a technological solution rather than a relationship based solution.

My friends Pepper and Rogers say that organizations that successfully embrace an integrated engagement strategy enjoy competitive advantages in three key areas: Productivity, Performance, and Sustainability. I don’t know about you, but those represent my big three! The advantages are in the personal commitment that each person makes to the goals of the organization, not their technological superiority.
Now let’s examine the critically of the integrated solution. My colleagues in marketing play a critical role in building the baseline of engagement. They gather the information regarding the needs and desires of the served and un-served customer base. They report on our ability to interpret the customer’s requirements and meet or exceed their expectations. They identify the potential opportunities and create the framework for the trust between customer and vendor.

Let’s talk about what they can’t do by themselves. An earlier quote said,”to your customers, your employees are the brand.”

A quote from the Harvard Business Review puts it even more succinctly –
“Too many organizations focus on what customers think – to the exclusion of what employees think. Companies are more likely to be growing if employee’s opinions of the company are better than customers’.”

Guess what, your marketing department can do a great job crafting and shaping your brand, but your management team has to make it real at the individual level.

How important is the manager you ask? Well, that same HBR article puts it this way-
“One bad manager can pollute multiple levels of an organization, and poor management brings down employee morale, which spills over into the engagement level of customers.”
James L. Heskett, one of the authors of the Service Profit Chain says “….But it also requires actions. That is when managers are not managing by the values and cannot be admonished or retrained to do so (which rarely works), they have to go.”

Before you delegate this to Human Resources you need to stop and recognize that this is a systemic issue. In short this is a leadership issue. Too many times I see Marketing or Human Resources being put “in charge” of these initiatives. That is corporate speak for nobody else wants to manage it and address the fact that we may have to make real changes.
I can’t tell you how many times in my career I have seen organizations tolerate management performance that is unacceptable. I hear “He’s really a great manager except for the people thing.” Guess what, the people thing is at the core of engagement.

If we look at the failure of the financial institutions and the automotive industry I believe we will find that the key mistakes were made in these areas of engagement and leadership. It was not technology that failed us, it was people.

So I would challenge you to examine the elements of those sustainable brands and my Compliance to Commitment model™. I would submit you are going to find several common elements:
· They are about congruency.
· They are about clarity.
· They are experiential.
· They are shared by people.
· They are systemic and synergistic.
· They are built on the same foundation, the foundation of trust.

There is no magic solution to the times that we find ourselves in. I believe that only through creating and reinforcing models that incorporate trust, communications, personal competency, and personal accountability at every level will be find our way to a new model.

Melanie and I have chosen to build lighthouses. They don’t chart your path, they light your way. Each person has to plot their own course, but by creating a lighthouse you expose the rocks and the shoals.
We agree with Marcus Buckingham-
“ Today’s most respected and successful leaders are able to transform fear of the unknown into clear visions of whom to serve, core strengths to leverage and actions to take. They enable us to pierce the veil of complexity and identify the single best vantage point from which to examine our complex roles. Only then can we take clear, decisive action.
Effective leaders don’t have to be passionate. They don’t have to be charming. They don’t have to be brilliant…They don’t have to be great speakers. What they must be is clear.”

Isn’t it time to explore a new model before we lose another “icon”?
“Commitment is the act of being physically, psychologically, and emotionally impelled. It means that employees gladly give up other options.”
Ken Matejka, Why This Horse Won’t Drink, 1991

A Convergence of Thought

So another interesting week. I enjoyed the desert, but I didn't go to Las Vegas. The stock market has been mostly up the last few days. Is this a trend or are we grasping at straws?
I really like the website BNET.com. It typically has great articles on it. Sometimes it is practical advice, sometimes it is just interesting insights. I enjoy the McKinsey Quarterly as well.

This week I had a chance to read two different pieces that caused me to pause and muse. The first was a piece by Jeffrey Pfeffer, the professor of management and author from Stanford University. Professor Pfeffer was lamenting and commenting on the loss of personal accountability in our culture. His point was how everyone from politicians to business leaders don't seem to accept any personal responsibility for either their actions or the impact of their action or inaction on their companies, their employees, and their shareholders. I don't think this is limited to politicians and business leaders. This may be impolitic, but right now it isn't very popular to assign any of the responsibility for the housing crisis to the consumers who purchased real estate far beyond their ability to pay for it in the hopes that "appreciation" would create enough value to protect them. I am not excusing the bankers who made the loans, I am just sharing some of the responsibility.

I kind of see the situation with AIG in a similar light. We have the CEO saying I know that we drove our business off the cliff and the taxpayers have bailed us out for billions of dollars, but we promised these executives millions of dollars in bonuses for "performance" that has nothing to do with reality or share holder value. I have to pay it out.

I hear employees,students, and regular "folks" taking the same approach. It isn't my fault.

I got to read another interesting piece with a woman who runs a philanthropic venture fund. Jacqueline Novogratz, CEO of the Acumen Fund, has a perspective I find both intriguing and inspiring. Her position is that traditional philanthropic giving can rob people of their self respect and create a kind of codependency. She actually invests philanthropic contributions in for profit businesses to create a return. She even goes further and suggests giving away services, even basic services is enabling rather than empowering. She uses the example of the slums as an experiment in capitalism. She describes the bartering and trading that goes on among even the most destitute.

Any of you that have had a chance to read my ideas on moving from compliance to commitment know that one of the key principles embedded there is the principle of respect. Respect for your self and respect for others. You need to respect yourself enough to engage and to perform the tasks of your job and your life to the best of your ability. We need to respect others enough not to make excuses for their shortfalls. We all have limitations, but there is a profound difference in recognizing that I will never play in the NBA and my expecting society to take care of me.

My friend and colleague Reut Schwartz-Hebron takes a similar approach with her model of KindExcellence. She feels and I agree that you need to create a balance of the two. They are inextricably linked.

I had a chance to work with my son on a paper discussing Aristotle's concept of moral virtues. Aristotle describes the difference between three different dimensions; faculties which he would describe as innate, emotions, which we endeavor to control, and moral states. His position is that a virtue must be a cognitive choice and it must be on a continuum. We must find the "golden mean". It must be learned and practiced.

All of these things converged for me with the concept of personal competence. They all embed rational, thoughtful behavior and personal responsibility. Aristotle went so far as to say that the pursuit of virtue is really the only thing that distinguishes us from other plants and animals. We are conscious. We make choices and we accept accountability for those choices.

Maybe I am reaching, but we seem to have entered a space where we debate whether leaders are "born" or taught. We seem to want to absolve ourselves individually and collectively for responsibility for outcomes.

Our economy is in turmoil, but maybe Pfeffer, Novogratz, and Aristotle are right. If we look to the government and/or philanthropy in its traditional form to "fix" things have we stripped ourselves of personal competence and dignity. I wonder.