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A Better Model

 

Would You Stand Under the Arch?

The ancient Romans had a tradition: Whenever one of their engineers constructed an arch, as the capstone was hoisted into place, the engineer assumed accountability for his work in the most profound way possible: He stood under the arch.”

Michael Armstrong

When I used to teach a unit on leadership for our local Chamber of Commerce I would challenge those emerging leaders to “come to work every day willing to be fired for doing the right thing”.

 I used to tell the people on my HR teams the same thing.

Over the last few weeks that has been a lot out there in the blogosphere that talks about what I might call legitimacy.

I believe that to a large extent leadership, as opposed to management, is founded in legitimacy.

Leadership is entirely relational versus hierarchical.

A transitioning special operator from the US army described it to me this way-

On our teams we have a shared leadership model. It was only when our new officers recognized and embraced that they really needed to earn our trust that we would truly follow them. We could learn from them, but they could also learn from us.”

I would submit that these special operators, the elite of our military which include groups like the Navy Seals and Green Berets epitomize high performing teams and engagement.

 As a manager you have the authority of your position and the benefit of what Covey calls deterrence, authority that comes from rules or position. We would like to believe that management also incorporates Covey’s second level competence, but I am not sure that is true.

At least not competence at the right things.

 In many cases the competence we rely on in elevating someone to a management role is based on application of their technical skills, their competence in emotional and social intelligence are still considered “soft skills”.

In my over 30 years as a human resources professional, C level executive, and management consultant it has been interesting to see emerging and current “leaders” bridle at the idea that they have to earn trust.

For many it is an expectation that trust is embedded in their role.

It is very chic today to dismiss collective bargaining and unions as passé, but any student of the relationship between employer and employed realizes that up until the 1940’s the concept that employers needed legitimacy through the input of their employees was considered ludicrous.

I suspect our new President isn’t big on the legitimacy model….

Many of our current models still have their roots in scientific management-managers manage and people do. If you see people as human capital, what is the likelihood that you are seeking the endorsement of those you “lead”?

Michelle Berg wrote a great post a few weeks back telling us about a conversation she had with a group of marketing professionals about why she “hates” HR. If you read the article what Michelle is really describing is a leadership fail- we ask HR to make up for what she calls shitty leadership.

I agree with her, I have seen a lot of this in my three decades plus career, and the reality is that this really is a leadership fail, not an HR fail.

I remember many years ago when our CEO couldn’t figure out what key metrics to assign me as the Human Resources manager for my management incentive plan, (That’s a topic for a whole separate post).

He proposed that my entire incentive be based on executing a meaningful improvement (ten percent or more), on our employee climate survey.

I would be the only manager who had this goal….

I countered with the idea that I would put the same percentage of my incentive on the line for that single metric as he was…

As you might suspect he wasn’t amused. He also declined to accept my challenge. He wouldn’t stand under the arch.

I think one of the fundamental differences between management and leadership is that commitment to personal accountability and being willing and able to create alignment with the vision.

There are some excellent models out there to accomplish this kind of alignment. Three of my favorites are offered by Stephen MR Covey, Patrick Lencioni, and Malcolm Gladwell.

Covey talks about the three levels of trust and the trust tax that the majority of organizations are paying.

Lencioni lays out a roadmap for what he calls the journey to organizational health, with the two most critical factors being building a cohesive leadership team and creating and reinforcing clarity.

Gladwell talks about legitimacy.

According to Gladwell legitimacy occurs when three elements are present-

• Those who are governed have a voice in the process; their input is sought and heard.

• There is a dimension of predictability and consistency in the application of the law or standards.

• The application of the law or standard has to be administered fairly and objectively, you can’t have disparate treatment without a clear and compelling reason.

There are interesting connect points between these three (at least to me).

Covey describes his three levels of trust and how it is the third level, identity based trust, that is the most critical.

He uses scary words like intimacy, transparency, and shared experiences. It gets even scarier when he describes the idea that credibility is a function of both competence and behavior.

You have to do both.

Lencioni describes trust as the critical foundational element of a cohesive leadership team and organizational health. I am pretty sure he means identity based trust versus deterrence or just knowledge.

I see these elements in Gladwell’s description of legitimacy. Words meet actions, consistently.

There is and has been a lot of discussion about employee engagement these days. There are detractors who say it is all bullshit and then supporters like me who think if you aren’t seeing results it’s because you are doing it wrong.

Lencioni describes three biases that can get in the way of meaningful cultural change and I see them in the way many organizations approach engagement-

·         Sophistication- it is just too simple. I hear from organizations a lot when we introduce fundamental skills training for emerging leaders that there is no “rocket science” to things like setting expectations, giving feedback, taking corrective action, and coaching.

I agree the concepts aren’t rocket science you just have to do them consistently and hold people accountable if they aren’t doing them!

·         Adrenaline- creating organizational health and identity based trust doesn’t happen over a long weekend or a management retreat. It doesn’t happen by conducting an engagement survey either. Engagement is a culture, not a program. It doesn’t belong to HR.

·         Quantification- although we have gotten a lot better at being able to quantify the benefits of engagement it is still a little bit nebulous. I here from people “we did a survey and engagement and/or productivity didn’t improve.”  I ask them if they addressed the issues from the survey and I get the thousand- yard stare. Or they tell me that “gave it to HR to fix”.

Changing a culture is hard and the work never stops. It is also a systemic process. You can’t just approach one part like hiring or compensation and expect to see widespread results.

For the last three decades I have been promoting and teaching the merits of an employment relationship based on Commitment rather than compliance.

My particular model is based on five elements-

·         Respect- everyone has an absolute entitlement to be treated with respect for their personhood.

·         Responsibility- I am a big fan of what our Founding Fathers called personal competency. People should be treated like adults and expected given clear expectations and feedback to meet those expectations.

·         Information- I am a huge believer in context and a link to the big picture. Simon Sinek calls this the Why.

·         Equitable compensation- people perform better when they believe they are being paid fairly for their effort and they understand how those decisions are made. Paying someone fairly is a threshold, not a breakthrough.

·         Mutual Loyalty- when I hear employers lament the lack of loyalty I want to laugh. Employees didn’t invent the term human capital or come up with strategies like outsourcing or offshoring to increase profitability. Loyalty should be measured by contribution, not tenure.

 

These elements are anchored on a foundation of trust. I would go so far as to say you have to have trust at all three levels to experience true engagement.

When the employment environment is optimized in a commitment based model it results in employee engagement.

Surveys still come out every year that reinforce that the most important role played by human resources professionals is compliance. This is consistent from both operational executives and human resources professionals themselves. This is what Michelle was referring to when she called it shitty leadership!

Alternatively, a recent survey of all four generations in the workforce identified the following on employee’s wish list-

• Open and transparent communication

• Respect for them and other employees

• A supervisor/boss that coaches and supports their growth and advancement

• A supervisor/boss that recognizes them and their performance

I don’t think you need to negotiate your culture with employees, but I do think they are entitled to clear expectations, constructive feedback, and fair treatment.

When you provide that kind of context you are allowing employees to join up with you.

On that foundation when change is introduced you do it with rather than to people.

Engagement and legitimacy don’t “belong” to HR, they belong to leadership at every level.

At the individual manager level, I would encourage you to consider the following

·         Ask your internal and external customers how you can help them and make them more successful. If you don’t think you have any internal customers give me a call. We have work to do.

·         Ask your staff what obstacles you can remove to make their job more efficient or easier.

·         Ask the people on the front line how your products and services can be enhanced or modified to make them easier to address their needs.

·         Ask your peers how they think you and your group are doing. You are an internal service provider.

·          Ask your boss how you can help them. This may seem a little obvious, but you will be surprised from how you communicate to taking a task off their list can make a difference.

 At the organizational level, I think we need to address these things with a level of urgency.

While the number of employees who rate themselves as highly engaged had remained constant for a few years (around 30%), those numbers are starting to decline and disengagement and voluntary attrition in an already competitive market are on the rise.

For those of you unfamiliar with disengagement, it is the phenomenon where employees are extremely unhappy, but they stay and “poison the well” rather than look for other opportunities. What is truly scary is they are no more likely to leave on their own power than employees who are neutral.

The data is in and it is conclusive - there is a direct correlation between employee engagement and customer engagement. In fact, the data shows a direct relationship between disengagement and presenteeism and turnover to the tune of $5 trillion annually.

We can’t run away from it anymore….

 

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Play To Win!

Getting the Performance You Want!

At the end of the day I believe this is the objective that every manager in every organization is most interested in meeting and exceeding.

It is also one that even after a couple hundred years in the continuing dynamics between employer and employed we still do badly.

If you choose to disagree with me just take a look at the latest numbers on employee engagement and turnover.

You can’t pick up a business journal without encountering something on this topic. The latest thinking is that traditional performance assessment is useless and should be thrown out.

I don’t disagree, but it leaves us with a gap-

·         How do we continue to improve the capacity of our talent?

·         How do we appropriately distribute compensation since most of our talent won’t work for free?

I believe that the first step in building a great organization is selecting your talent pool, but that is a topic for another day so I want to focus on managing the performance of the talent you have.

I have a strong personal bias that says that effective managers and leaders have to be at least minimally competent at several key skill sets. They are in priority order-

·         Setting clear performance expectations

·         Giving and receiving constructive feedback

·         Taking appropriate corrective action

·         Delegating appropriately and effectively

·         Utilizing positive reinforcement to motivate future performance

·         Coaching to optimize performance

I also happen to believe that hiring or selecting leadership candidates with the following attributes increases success:

• Technical competence (mastery of the knowledge, skills, and abilities to perform the job).

• An understanding and mastery of all three levels of trust (Deterrence, Competence, and Identity)

• Emotional Intelligence (this allows you to know which level of trust or leadership style to employ in a given situation)

• Emotional Balance – how do you show up every day? How do you react under stress?

• Self-Awareness- do you see yourself even close to the way others see you?

For me personally, the technical competence is kind of the threshold, you need it to gain admission, but it is the minimum standard not the measuring stick.

The bad news is that these skills sets are neither inherent, nor are they taught in most business schools or degree programs.

We don’t do much better internally either.

A recent study of participants in formal high talent development programs drew some rather unfortunate conclusions.

The study evaluated these individuals in leadership capabilities using a 360-degree assessment including their manager, several peers, direct reports and other colleagues.

Their prior research had indicated that collecting data from this kind of cross sample could be statistically correlated to desired outcomes like employee engagement, lower turnover and higher unit productivity.

Here is more bad news;

·         12% of these HIPO participants were in the bottom quartile on leadership effectiveness and

·         Overall 42% were below the median.

 I would call that an epic fail.

The good news is that these skills are eminently teachable and most manager/leader candidates can master them to at least some degree of competency.

The literature is replete these days with the benefits of engaged employees as opposed to marginally or unengaged employees.

Much of that engagement is accomplished in your hiring and selection, but continuing to see engagement is best accomplished when employees feel that they are playing to their strengths and their highest skills.

A recent survey of 13,000 employees, including representation from all four (4) generations currently represented in the workplace, cited four characteristics they seek in a boss and organization they trust.

If you don’t understand how trust plays into it, you have wasted the time you spent reading to this point!

• Open and transparent communication

• Respect for them and other employees

A supervisor/boss that coaches and supports their growth and advancement

A supervisor/boss that recognizes them and their performance

The interesting thing about that as it relates to how we evaluate performance is how poorly we do it.

In most cases we try to evaluate skills. It turns out our personal biases effect those ratings significantly.

A study quoted in HBR showed that in evaluating the ratings of almost 4500 managers including their direct reports, peers, and subordinates varied substantially, and that over 60% of the variance could be attributed to the rater’s bias- only 20% was actual performance variance.

The point is that performance information we gather is not horribly valuable because it is so potentially biased.

Deloitte decided to tackle this issue with what I think is a fascinating experimental approach to managing performance.

They found as the Gallup organizations research has demonstrated previously, that teams and individuals that are allowed to play to their strengths consistently outperform others.

 In their own internal research, they found that the variance between high performing teams and lower performing teams could be accounted for by team members responded to three items-

·         My coworkers are committed to do quality work

·         The mission of the company inspires me

·         I have the chance to use my strengths every day

The first two items speak clearly to the concept of an employment brand. The third is the critical link of clear expectations and focusing employee efforts on playing to their strengths in support of the organizational mission.

I like to think the ties to the critical skill sets I outlined above become pretty clear at this point!

Deloitte decided that their objectives for performance management are in three key areas:

·         Recognizing performance and appropriately rewarding it

·         Capturing meaningful and accurate performance data efficiently

·         To fuel appropriate future performance

To accomplish their objectives, they created a snap shot approach that asks team leaders to communicate their future actions about each employee and the end of every project; or at minimum each quarter for long term projects.

Their research found that four items provided the basis of that snapshot:

Given what I know of this person’s performance, and if it were my money I would award this person the highest possible pay increase and bonus. This measures overall performance and unique contribution to the organization.

Given what I know of this person’s performance, I would always want him or her on my team. This measures the employee’s ability to “play well with others”

This person is at risk for low performance. This identifies areas for intervention ranging from coaching to other more drastic action and minimizes risk long term.

This person is ready for promotion today. This measures perceived potential.

Each of these items is rated on a five -point scale ranging from strongly agree to strongly disagree.

Any rating of less than 5 on questions 1, 2, and 4 are a platform for discussion and mutual investment by the employee and the organization.

By focusing on these snapshots you have a roadmap for both discussion and managerial action

In addition to these quarterly snapshots each team leader is expected to check in with each team member weekly. The purpose of these “check ins” is to clarify expectations, monitor short term progress, and provide course correction, coaching, or other valuable input.

The interesting thing at Deloitte is they don’t consider these “check ins” ancillary or in addition to the team leader’s role, they consider them to be inherent to it. The other interesting dynamic is that responsibility for scheduling the check ins is with the individual team member!

As you might suspect, I am a fan of this new approach.

 If we are really honest the point of performance assessment is to encourage desirable performance and discourage performance that is not contributing to the organizational mission.

The purpose of employee engagement is alignment with organizational objectives.

We can’t make employees happy! Anyone that has ever been in a relationship knows that is not a project you want to take on.

Happiness is deeply personal and means something different to each of us. Studies have also shown that things that have nothing to do with organizational performance may drive “happiness” and that happy doesn’t mean better performance.

Increased morale is great, if it contributes to increased performance and reduced turnover. It is not an organizational goal on its own.

To go full circle, I think you can see the critical correlation between the skills I mentioned previously and the ability to execute on this kind of a model.

If managers are not skilled at setting expectations, giving constructive feedback, coaching and developing employee’s strengths then you only have a two dimensional model that doesn’t address the three objectives that Deloitte identified.

In the final assessment the team with the best players who play well together are going to win the most consistently.

This model won’t make up for poor hiring and selection or manager/team leaders who don’t have the skills to diagnose and coach performance issues, but it is far superior to what most of us are using today taking a huge step towards “managing whole people”.

So tell me; are you playing to win or are you just playing?

 

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Understanding Real Legitimacy

Understanding Real Legitimacy

I just finished re-reading Malcolm Gladwell’s latest book, David and Goliath.

Like the books that preceded it I enjoyed it a great deal.

I see Gladwell as kind of a social facilitator and observer. He doesn’t try to present himself as a behavioral scientist with countless reams of data to support his conclusions, he makes comments and observations. The reader has the choice to accept or reject them.

Given the outcome and the divides both during and now following our election cycle I found some of his insights particularly worth revisiting.

While I enjoyed the entire book the part that most spoke to me was Gladwell’s discussion of legitimacy.

According to Gladwell legitimacy occurs when three elements are present-

·         Those who are governed have a voice in the process; their input is sought and heard.

·         There is a dimension of predictability and consistency in the application of the law or standards.

·         The application of the law or standard has to be administered fairly and objectively, you can’t have disparate treatment without a clear and compelling reason.

From what I have seen demonstrated to date our new President doesn’t share Gladwell’s description of legitimacy.

Specifically, his interest in viewpoints that don’t coincide with his own appears non- existent and his application of laws and standards don’t in my opinion pass the fair and objective test.

I personally believe that any meaningful change in our leadership philosophy and application is going to need to come from the private sector. The current administration is interested in a rigid application of the compliance model; people should do as he instructs them.

It will be interesting to see the repercussions of the DeVos nomination, never before with a majority in the Senate has the Vice President had to cast their vote to confirm a cabinet nominee.  

The President has never been in an environment previously where he is accountable to anyone and he seems to be struggling with that transition.

The reason I find this discussion about legitimacy so interesting is in its application to the work environment.

For the last three decades I have been promoting and teaching the merits of an employment relationship based on Commitment rather than compliance. When the employment environment is optimized in a commitment based model it results in employee engagement.

I also believe that to a large extent leadership as opposed to management is founded in legitimacy. Leadership is entirely relational versus hierarchical. As a manager you have the authority of your position and the benefit of what Stephen MR Covey calls deterrence, authority that comes from rules or position. We would like to believe that management also incorporates Covey’s second level competence, but I am not sure that is true.

 In many cases the competence we rely on in elevating someone to a management role is based on application of their technical skills, their competence is emotional and social intelligence are still considered “soft skills”.

The highest level of trust in Covey’s hierarchy is identity based trust which incorporates both your competency and you character as demonstrated by your applied values and behavior to create credibility.

In my over 30 years as a human resources professional, C level executive, and management consultant it has been interesting to see emerging and current “leaders” bridle at the idea that they have to earn trust. For many it is an expectation that trust is embedded in their role, they shouldn’t have to earn it.

It is very chic today to dismiss collective bargaining and unions as passé, but any student of the relationship between employer and employed realizes that up until the 1940’s the concept of employers need legitimacy through the input of their employees was considered ludicrous.

Unions fought very hard to legitimize their right to bargain with employers over hours, wages, and working conditions. I am not going to say that I believe collective bargaining is the preferred methodology or relationship structure between organizations and employees, but the concept of participating as equals didn’t come from management enlightenment. Many of our current models still have their roots in scientific management-managers manage and people do. If you see people as human capital, what is the likelihood that you are seeking the endorsement of those you “lead”?

Surveys come out every year that reinforce that the most important role played by human resources professionals is compliance by both operational executives and human resources professionals themselves.

Under the old social contract organizations provided a degree of social and economic security in return for loyalty (spelled compliance in my opinion). As the economy became more international we still wanted the loyalty, we just didn’t want to provide the security.

It is interesting in most jurisdictions outside of the U.S. the subjects of bargaining include the introduction of technology into a work setting. In our U.S. model we must negotiate the effects of the technology, but not its introduction.

In creating my own foundation for employee engagement I feel that there are critical elements you have to include.

The first is a foundation of trust. I would go so far as to say you have to have trust at all three levels to experience true engagement.

I also think you need to add the elements of respect, responsibility, information, equitable rewards, and mutual investment.

I don’t think you need to negotiate your culture with employees, but I do think they are entitled to clear expectations, constructive feedback, and fair treatment.

When you provide that kind of context you are allowing employees to join up with you. On that foundation when change is introduced you do it with rather than to people.

Gladwell’s examples of authority without legitimacy are pretty fascinating; the outcomes aren’t pretty.

There is a lot of discussion about the next generations. They are pretty intolerant of assumed legitimacy. They also represent both the future employee base and future leadership.

Perhaps taking a moment and asking ourselves if we are incorporating legitimacy and trust into our leadership models and recognizing and teaching the skills of leadership beyond technical competency is a worthwhile endeavor.

I hope it at least provides food for thought…..

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What Did We Learn?

I am not a huge fan of New Year’s Resolutions. I find most of them have a shelf life of about thirty days max.

I am however a pretty big fan of reflection.

In honesty I found 2016 to be a disappointment. The year started with some promise, but then kind of petered out.

I think one of my biggest disappointments was that it seems like this leadership thing still seems to elude us. We still use expressions like human capital and continue to want to minimize the human interaction in our hiring and recruitment processes.

This year I became pretty much a raving fan of Simon Sinek. His advice about starting with Why, describing how leaders eat last, and some of the issues faced by Millennials in the workforce really captured my attention.

Patrick Lencioni’s The Advantage and Angela Duckworth’s Grit were also among some of the best stuff I read.

I also read things that while they resonated with me caused disappointment like a great blog that shared the dirty little secret that the vast majority of our graduate business programs don’t include anything about foundational concepts like trust and emotional intelligence and still secretly reinforce a lot of Frederick W. Taylor’s scientific management theories.

Which is where I think the idea of people as disposable assets got their roots in modern society. Prior to that we just called them serfs. I guess human capital is nicer.

I read things that said that employee engagement and emotional and social intelligence are all bullshit and hocus pocus because they can’t be properly measured. I disagree. The fact that you do a shitty job of executing on a concept doesn’t invalidate it, it just speaks to your leadership skills.

The ship has sailed on whether or not engagement is real and it can affect the performance of an organization. Organizations where employees consider themselves highly engaged outperform their competitors in every key performance indicator and engagement is a universal rather than a North American phenomenon.

I had the opportunity to work with a recently retired member of an elite military unit about his transition. We explored things like Covey’s trust model and Simon Sinek’s Start With Why and Leaders Eat Last.

His reaction is “duh”. These concepts have been embedded into the culture he spent his adult life to date in. The fact that these are an epiphany in the private sector stunned him a bit.

He shared with me that being a leader in these units is the easiest job in the world. Everyone is highly competent. Everybody is committed to the mission. The leader blocks and tackles.

Our elite military units have mastered something that in the private sector we call an employment brand.

My colleague Brad Federman very elegantly described an effective employment brand in a post a while back-

Don’t chase people. Be an example. Attract them.

Work hard and be yourself.

The people who belong in your life will come and stay.

Just do your thing.

I was pretty struck by the profound elegance of this statement both for individuals and for organizations. I wish I had of heard this before giving life and career advice to my millennial aged children.

I think organizations should have a leadership brand too, how we expect leaders to behave and what we hold them accountable to do.

Kind of like trust and respect your leadership brand should include legitimacy. I like the way Malcolm Gladwell described legitimacy in his book David and Goliath.

·         Those whom are governed have a voice in the process; their input is sought and heard.

·         There is a dimension of predictability and consistency in the application of the law or standards.

·         The application of the law or standard has to be administered fairly and objectively, you can’t   have disparate treatment without a clear and compelling reason.

When I read about what Millennials and the following generation is seeking them seem to want legitimacy from their leaders as well along with the purpose and identity based trust that Covey and Lencioni describe. I think they are right.

I enjoyed some success in 2016. We had a number of folks show up for the leadership training we do and more than a few folks read my ramblings on my blog and other posts so I guess there is some light at the end of the tunnel.

So I guess as we make the turn I will keep talking about managing whole people, relying on identity based trust as your foundational principle, and recognizing that your employment brand dictates your business brand and that your customers will never be more engaged than your employees.

We still have work to do on this leadership thing too…

See you next year.

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We Are Doing It Wrong!

A couple of things I have seen recently reinforced for me what we continue to do wrong in our efforts at leadership.

The first was a story about a teacher who almost took delight in grading the work of a child in her fourth grade class and giving him the failing grade that his unorganized, sloppy work deserved.

Because she was thorough she chose to read evaluations of his past work by his previous teachers and discovered that a very bright child was affected by his mother’s serious illness and eventual death and the absence of any meaningful attention from a grieving and distracted father.

The epiphany associated with that discovery caused her to make a fundamental shift in her approach to teaching. Instead of teaching subjects like reading, writing, and arithmetic; she began teaching children- a profound distinction.

The poor performing child went from a distracted student to a practicing physician and shared with her along that journey how compelling her intervention was in his achievements.

In another story teachers were exposed to the question – what I wish my teacher knew about me.

The students wished that their teachers had a little more of an appreciation in what was going on in their lives outside of school and the classroom.

I have been a practicing manager for over three decades. I remember the model I was originally exposed to as the fundamental skill sets of effective management- planning, directing, controlling, and budgeting.

We were still immersed in the precepts of Frederik Taylor’s scientific management model. Some were born to do, others born to manage or lead.

As a young human resources professional we were tasked with administrative activities and relieving managers of less valuable activities like setting expectations, providing feedback, coaching for optimal performance, and taking appropriate corrective action when performance didn’t meet expectations.

The Civil Rights Act and its amendments and additional legislation that followed that made discrimination on a number of issues illegal and introduced affirmative action to try to right wrongs gave human resources some leverage because the requirements weren’t well understood and proliferated.

The models were still very much about compliance, if employees would be loyal (defined obedient) they would be rewarded with a degree of security upon retirement. Then we discovered outsourcing, down- sizing, and offshoring to optimize financial performance and the contract was broken.

According to a recent survey over fifty percent of people seeking additional managerial responsibilities do so to increase their earning potential.

Executives acknowledge that highly capable manager with well- developed leadership skills cause their organizations to outperform their competition by a significant degree, yet less than half feel their organization does a good job of developing leaders.

A few years ago I got very enamored with the concept of what we are now calling employee engagement. Even before the data was available something told me that there was a better way. It inspired me to publish my first book, Managing Whole People, in 2008.

In the intervening years the data has become much more prevalent and compelling. We have made some progress in changing the model, but the dark years between 2008 and 2010 brought back a lot of the predatory practices of the past inspired by high unemployment and employees feeling trapped.

We have four generations in the workplace now and the latest two entrants look at work and the employee-employer relationship very differently.

They expect employers to provide them with a compelling purpose for the work that they do, to invest in them and their personal and professional development and to earn the trust and respect if they want to see it reciprocated.

I think they are right. Terms like human assets and human capital make me grind my teeth. Human resources practitioners who believe the most important role they play in their organization is compliance piss me off, and executives who still refer to managing people as a soft skill annoy me to distraction.

Like that teacher discovered we have been doing it wrong. We need to recruit, manage, and retain whole people. We need to provide alignment and purpose and manage people and talent not assets.

You don’t need to be a therapist or a social worker. You do need to build and reinforce identity based trust and there is not a degree or a training program that can do that for you. You have to do the work and you have to do it every day.

The benefits are clear and compelling, so is the downside of doing what we have always done.

If you think that emotional and social intelligence don’t exist, you are screwed. You live in a bubble of your own construction. If you think that trust and respect are perquisites that come with a position or title you are going to fail.

Let’s fix this….

 

 

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Time to Update Your Brand!

 

A few years ago a client of mine shared a conversation he had with another CEO of a high technology firm who was lamenting that a particular large Midwestern city had a significant shortage of qualified engineering talent. He asked his friend how he had come to that conclusion and his colleague indicated they had been recruiting for talent for almost eight weeks with limited results. My client responded, “There isn’t a shortage of talent, your company has a lousy employment brand. Do you think if Apple or Google were recruiting in this same location they would have any difficulty recruiting the talent they need?”

My client is exactly right. Certain companies and I would include organizations like Amazon, Google, Apple, and Zappo’s among them, don’t have any issues recruiting the talent they require. They have managed to achieve a certain cachet not only about their products, but about their company. They have a clearly defined employment brand.

People join cultures not organizations and they leave managers not companies. Your product or service brand will never be better than your employment brand.

Here is another reality check- The workplace is about to span five generations for the first time ever in history; Silents, Boomers, Gen X, Millennials, and Gen Z.

A 2014 study reported that some 41 percent of respondents said the most important factor in their decision to apply to an organization was a company’s values. Nearly half of all candidates said their first relationship with a company was as a candidate — which means that’s the juncture when employers have to get it right.

Another reality is that to a large extent leadership in developing new social models is going to have to come from the private sector.

In the business world we have a population of approaching twenty percent that are actively disengaged in their current employment environment. That means they come to work every day pissed and minimally productive. The costs of that have been well documented in terms of absenteeism, lost productivity, health care expenditures relating to mental health, obesity, and other factors.

Do we really think that meaningful leadership in addressing these issues is going to come from our elected officials? Especially considering that there is a large population that is refusing to acknowledge the outcome of the Presidential election. Added to that I would have to say that many of the selections the President elect has made for Cabinet appointments give me pause. These folks don’t seem to be interested in making the world a more collaborative place.

Our leadership models are in large part stuck in the past. We still focus very heavily on what my colleague Geoff Searle refers to as technical intelligence. Technical intelligence doesn’t build trust and trust is foundational to a solid employment brand.

Dustin McKissen, founder and CEO of McKissen and Company, talked about this in a blog post in Inc Magazine, The Rotten Core of Every MBA Program.

He specifically cites our ongoing infatuation with Frederick W. Taylor and his Scientific Management models-

While Taylor's theories are viewed as harsh and impractical today, his work was still cited in every class I attended that discussed the roots of modern management science. What's not often discussed is how little Taylor thought of the people who actually produced products in the factories he studied.

I mentioned that in a recent blog post. Traditional MBA programs train candidates to be what Lawrence Miller described as Bureaucrats and Administrators in a book he published almost 30 years ago. Given his observation and the fact that McKissen published his observations just a few months ago I am pretty bummed.

The competition for the best talent is on the upswing and my personal experience validates the conclusions of the 2014 study- the new employee is looking for a role where they feel challenged and congruent with the values of the organization.

The concept of human capital and maybe even human resources is dead. We hire whole people and rent their talent. They aren’t disposable assets and are going to require the same care and feeding as customers, maybe more and like customers their ability to cut through the bullshit are being honed and applied.

 

Step back and look at your approach to talent and people systemically or suffer the consequences…..

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History- Study or Repeat?

I had a chance over the holiday weekend to read a book a client shared with me, Barbarians to Bureaucrats, originally published in 1989. The book describes leadership styles and business life cycles and as I read it I was reminded of other great books that have tried to express the same message over the past three decades.

One of the great quotes from this particular book is “the decline in corporate culture precedes – and is the primary causal factor in the decline of a business, and that decline is the result of the behavior and spirit of its leaders.”

I have certainly found that to be true over my almost four decades as a human resources practitioner, executive, and management consultant. Culture eats strategy!

I have to say that as I read this I saw application not just to the “corporate” world, but society in general as I look at the vitriol and nastiness of our latest election for the Presidency. We have a national culture problem.

I have a passion for the concept of employee engagement, a concept that has been around for almost three decades in some form or another, but has not been universally embraced.

The ship has sailed on whether or not engagement is real and it can affect the performance of an organization. Organizations where employees consider themselves highly engaged outperform their competitors in every key performance indicator and engagement is a universal rather than a North American phenomenon.

The author also talks in his book about a couple of other concepts that explain our failure to launch.

He talks about the two sides of the coin as it relates to national involvement, public purpose and private interests.

I have embraced the thinking of people like Michael Porter and Nilofer Merchant that all profit isn’t equal. Social profit, profit that benefits society and total versus just a smaller shareholder group has more long term benefit. I prefer the stakeholder versus the shareholder mentality.

The other thing that he discusses is the myths of the perfect culture and the perfect management/leadership style. That simply isn’t the case.

How many times do we see organizations (and consultants) shlepping around a template[MH1]  of the perfect culture?

When Good to Great was published everybody ran out to copy it. It is interesting to me that although several of the organizations that Collins cited don’t exist anymore almost every executive I know has a copy on their bookshelf. Some of them have even read it.

I remember reading Situational Leadership back in the early nineties and incorporating it into my tool kit with the idea that you need to meet people where they live and flex your leadership style accordingly.

We still don’t like to talk about soft skills and we aren’t very good about teaching them. I saw something as recently as today that said that the concepts of emotional and social intelligence don’t really exist because we can’t scientifically validate them, we should rely on IQ.

Sorry professor you are wrong. Everything can’t be validated. We have this thing called religion, which is based on faith which although it can’t be validated seems to have caught on…

Perhaps because of my professional development as a human resources practitioner the idea that leadership is based on behavior not words and that at the end of the day it is a relationship rather than a position these things resonate with me.

I see corollaries to this book in Gladwell’s David and Goliath, where he discusses legitimacy as part of the leadership infrastructure and Stephen MR Covey’s The Speed of Trust, where he identifies the three levels of trust and how the achievement of identity based trust is critical to sustained organizational performance. Perhaps I am reaching, but I also see a relationship to Simon Sinek’s Golden Circle in terms of giving people something to believe in.

Scientific management created the foundation for what I believe this author describes as the Administrative and Bureaucratic stages of an organization, where processes become more important than people and definitely more important than the product.

The author talks about this being why we have lost a great amount of our manufacturing competitiveness to foreign locations, first Japan and Germany because of quality, and then to other outsourced markets because of cost. A situation that hasn’t improved drastically in the thirty years since the book was written.

He also talks about the importance of balancing financial, planning, and technical competence with creativity. I would add leadership competence, those soft skills like emotional and social intelligence and the ability to flex your leadership style to the situation and the constituent base.

I can’t say that there was a lot of new ideas in the book that I hadn’t been exposed to before, what is a little troubling is how little meaningful progress we have made in the almost three decades since it was published.

I am also watching to see with the outcome of our election whether we have chosen a Barbarian who can create change or more concerning a business aristocrat masquerading as a change agent.

Jefferson described two camps relative to their view of people-

·         Those who fear and distrust the people, and wish to draw all power from them into the hands of higher classes (Frederick W. Taylor and Scientific management).

·         Those who identify themselves with the people, have confidence in them, cherish them and consider them as the most honest and safe.

I would submit that if the term human capital is part of your vernacular and you see culture and employee engagement as the province of your human resources department you have declared your colors…

 

 

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Trust, Leadership, and the Election

I think lot of folks I am over this election cycle. I have not participated in an election in my adult life where things were so polarized and nasty and from seat a lot of the issues people have with both major candidates is the issue that many employees have with their boss- an absence of trust.
As a recovering human resources and operating executive I candidly see this as the prevailing reason we are high centered on where we sit on the number of employees that see themselves as highly engaged in their relationship with their current employer.
They don’t believe that the organizational values that the organization talks about are the ones they practice or that they are personally aligned with those values.
We have seen a lot of cacophony about things like livable wages and access to health care that depending upon your vantage point you see progress or a creep towards socialism.
I hear from a lot of folks complaining that they have employee populations who are focused on the next fifty cents or dollar per hour rather than the “big picture” and what the organization is trying to achieve or the cost of an imposed wage standard on business expenses.
They are missing the point on two levels-
• Maslow’s Hierarchy, is as relevant today as it ever was. When you are in safety and survival mode you aren’t focusing on the big picture and how to become engaged. You are focused on basic issues like food and shelter. We saw an epic drama unfold on social media earlier this year with the young woman from Yelp writing an open letter to the CEO that she couldn’t survive in the Bay area on what she was making.
• Line of Sight, I tell my clients that line of sight may be the most important part of their compensation strategy. The importance of compensation strategy and performance management is to align efforts with outcomes. Employees need to see clearly how positive outcomes for the organization translate to positive outcomes for them and vice versa.
A colleague of mine, Bruce Kasanoff, wrote a post a while back that really captured my attention and spoke to this issue. He argued that the old adage of “teach people to fish, don’t give them a fish” doesn’t really work when people are hungry and scared and I think he is right.
Ron Willingham, author of Integrity Selling, as well as several other excellent books on sales and customer service explores this same theme in his Congruency model. He talks about how people typically operate on three levels; the intellectual, the emotional, and the visceral level. He points out that studies show when your emotions or visceral self is in conflict with your intellect logic loses the vast majority of the time.
Everything I have learned about compensation validates this as well. Once people feel essentially economically secure about their fundamental living expenses compensation is not a motivator for most people. What is very important is a sense of fairness and rationality. How does my employer make decisions about pay?
That is the fundamental issue that many women and other protected classes have with the pay gap between themselves and white males. In many cases it isn’t about survival, but rather equity.
The other issue I see mirrored daily in our society is our struggle with trust.
Stephen MR Covey in his brilliant book, The Speed of Trust, describes trust as operating at three levels; Deterrence or rule based, Knowledge or competency based, and finally and most importantly Identity- based.
I advise clients and colleagues that if you are only going to read one book on leadership read that one!
Our societal models are based on outdated thinking. Institutions have long wrapped themselves up in the virtual robes of being entitled to trust based on position. Monarchies were validated by the churches, who validated themselves as speaking with divine authority.
Frederick W. Taylor and his scientific management theory gave validation to the knowledge and competency leadership hierarchy. He argued most people were dumb, lazy, and fundamentally untrustworthy! They needed to be aggressively managed by white collar leaders.
You will look a long time to find competencies like emotional or social intelligence in Taylor’s model. The sad thing is that while we give lip service to soft skills if you look at most MBA curriculums they are still very knowledge or technically biased and many graduates feel entitled to a leadership role based exclusively on their academics.
As those of you who are familiar with me and my work know I am deeply committed to a few key concepts. Among them I include building your organization on a foundation of commitment rather than compliance and the concept of personal competency. This is validating and accepting that identity based trust is the real foundation of engaged employees.
There are a lot of other things that inherently embedded in those ideas, but they really represent the foundational pieces.
In the first is the idea that when people come together with a shared set of values and clarity about our purpose proactively and willingly the amount of energy they will bring to that effort increases exponentially.
The second is the idea that people are whole. They perform best when we give them both an opportunity and an expectation of being present.
You can’t create identity based trust without social and emotional intelligence, period!
Social gravity is the emerging concept of describing your value proposition in such a clear way and operating with such consistency that your stakeholders including customers, employees, shareholders, suppliers, and communities are drawn to you. There is a community of interests that is clear and compelling.
Social gravity doesn’t look the same in every organization. Since the dawn of the Industrial Revolution we have really developed an infatuation with best practices to the point we want to use them almost like recipes.
When I see surveys that conclude that most leadership failures occur because of organizational fit, interpersonal dynamics and related human factors I have to say I find the perplexity of failure of technology to guarantee sustained success ironically amusing. 
The answer is right there. It isn’t about processes it is about relationships. Processes can facilitate communications and tasks, but they can’t create relationships. That is a uniquely human dimension.
The two major candidates in this election are both caught up in the old model.
HRC is saying “trust me” I am really smart and well qualified. DJT is saying no trust me, I am a highly successful business man who is going to punish the establishment and take back what all those immigrants have taken from you. To an extent he especially is also playing the emotional and visceral card, fear and ignorance. She in turn points out his character flaws.
Both of them want us to base our decision on the first two levels of trust, legitimacy and competency. 
For me the issue is one of identity based trust, do I find either to have the personal and professional integrity to be my President?
In this day an age of consumerism and social media the accountability to earn and sustain trust rests with leadership at all levels and platitudes and generic mission and value statements isn’t going to get it done.
The advantages of employee and customer engagement are clear and compelling and two key points-
•    You will never have sustained customer engagement without employee engagement.
•    The foundation of engagement is trust. You have to do the work.
Be clear with management at every level it is their responsibility to earn and sustain trust and give them the tools to do that. They are entirely learnable and reinforcable.
Emotional and social intelligence like identity based trust are foundational to cohesive and sustained organizational performance and high functioning cultures. It is time to buckle down and do the work…..

 

 

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What Trumpet Do You Hear?

The Pillars of Effective Leadership

Leadership is one of those interesting topics that everybody, me included, writes and talks and preaches about.

Whether great leaders are born or taught, whether women are inherently better leaders than men, and whether or not there is a meaningful difference between leadership and management.

My answers to those questions are yes, not necessarily, and yes.

On a more serious note I had a chance to read some excellent contributions from four different people that I greatly respect that kind of distilled leadership into some key elements for me so I thought I would figuratively take pen to paper and share my take away’s.

My first contributor is my friend and colleague Geoff Hudson Searle who in his upcoming book, Meaningful Conversations, He differentiates between technical intelligence, the ability to demonstrate competency at disciplines ranging from financial management to science and technology, and emotional intelligence, the ability to inspire trust and commitment by understanding the motivations and behaviors of others.

Unfortunately, most of our “leadership” development pipeline is based on the former rather than the latter. In fact, as I have shared before many candidates seeking “leadership” roles do so in order to continue to see career progression and increased earning potential. They are not drawn to leading people particularly at all.

Much of our leadership development and management modeling are based on Covey’s first two levels of trust, statutory based on power and position, and knowledge based with a foundation based in competency or what Geoff refers to as technical intelligence. The research shows competency is indeed a foundational element, but not enough to create or sustain alignment or engagement.

Emotional Intelligence, the ability to identify different emotions, to understand their effect, and to use that information to guide thinking and behavior, is critically important.

In fact, I recommend to my clients we do not hire or promote individuals into management unless they display a reasonable capability in this area.

The problem is two- fold. First, it still isn’t necessarily well understood and applied; and second, it isn’t enough.

Justin Bariso, Founder of Insight, had a great post today on the seven myths of emotional intelligence or EQ. He identified these –

1.       DENIAL- Emotional intelligence doesn't exist.

2.       Emotional intelligence is just common sense.

3.       You can control your feelings.

4.       More emotional people are naturally more emotionally intelligent

5.       Sharpening your EQ is easy

6.       Once you've got it, you've got it

7.       Those with high emotional intelligence always make the best leaders

As somebody who has spent over three decades as a C level executive, HR executive, and consultant I have heard these and more.

Emotional intelligence is indeed real. If it was common sense, we wouldn’t see better than 60% of the working population not engaged or actively disengaged costing our economy billions annually!

We would all like to think can control our emotions, in fact that is what distinguishes us from the “lower” species, but the lizard brain is alive and well. Research has shown that when our rational mind finds itself in conflict with our emotional/feeling mind the emotional mind wins 85% of the time!

That is why Simon Sinek tells that creating a safe environment is the leaders number one role.

Being emotional and emotionally intelligent are two different things and increasing your EQ is both hard and continuous.

People with high emotional intelligence and no conscience are called high functioning sociopaths!

The fact that you are clued into the emotions and motivations of people is no guarantee they will only use their power for good rather than evil, or that they are benevolent or nice. Just ask anybody that worked for Steve Jobs, or for me for that matter!

That is a great intro to the next pillar, what the guru of emotional intelligence, Daniel Goleman calls Emotional Balance, the ability to keep disruptive emotions in check, to maintain effectiveness under stressful conditions.

His research indicates that this leadership competency is critical because emotions spread from group leaders to group members.

 Research done at the Yale School of Management shows when the group leader is in an upbeat mood, people in the group catch that mood and the team does better. Similarly, a leader’s negative mood causes team members to become negative and their performance to plummet.

Does it matter if a boss blows up at an employee? You bet it does. Research shows that employees remember most vividly negative encounters they've had with a boss. They remember it much better than the positive encounters. After that encounter, they felt demoralized and didn't want anything more to do with that boss.

Is there anybody out there that has not experienced this phenomenon?

Steve Jobs and others are famous for being brilliant, but also for having these kinds of outbursts. In my own experience this Dr. Jekyll and Mr. Hyde syndrome shows up in a bunch of ways, none of them positive including-

·         High turnover, great talent won’t put up with it.

·         Difficulty recruiting. Your “brand” gets out and people don’t want to work with you.

·         Active or passive disengagement. Some quit and stay, others actually actively try to sabotage the organization.

Goleman calls this the crucial competence-

“We did research with over 1,000 executives from around the world, CEOs, Board members, top leaders, about the characteristics of the best leaders. The number one response is the ability to stay calm and collected. In a crisis, being able to manage your own emotions and stay calm, be able to create this island of security and not spread your tension around.”

Once again feeling like you don’t know whether Dr. Jekyll or Mr. Hyde is going to show up from day to day doesn’t contribute to Sinek’s circle of safety or Lencioni’s organizational health.

The last pillar I want to cover is from Andrea Thompson, a retired military officer and now Director of the McChrystal Group, a management consultancy.

I’ve been asked by soldiers around the world, What’s the one thing I should know to be a better leader?” My answer remains the same: Know who you are, your strengths, and your weaknesses. Self-awareness will be that “extra something” that boosts you up the corporate ladder.

As we move up the ranks in our careers, our technical skills are usually the primary reason we get promoted. We closed the most deals or sold the most product. But as we develop as leaders, functional excellence is no longer the main component required to be high-performing and succeed as a senior leader.

Those leaders who soon recognize that their own behaviors and emotions have a domino effect on their team—and adapt accordingly—build stronger teams. Self-awareness is that “combat multiplier” that not only makes you a better leader, but those on your team better leaders, too.

Colonel Thompson spent almost 30 years as a serving officer on the United States Army including roles as the national security advisor to the House Committee on Homeland Security and executive officer and chief of staff to the Undersecretary of the Army so she has some street cred with me at least.

You could say that self-awareness is embedded in emotional intelligence or emotional balance, but I don’t think so.

I have seen leaders who are highly balanced and emotionally intelligent that just flat can’t see themselves in the mirror or worse can only be comfortable selecting and promoting people who are their mirror!

So for me when I look at developing my leadership pipeline technical intelligence or competency is the base threshold for entry into management, as people develop into leadership roles and especially C level roles I want to see them move through the gates of emotional intelligence or EQ, self- awareness, and emotional balance.

Most of these things can be to a large extent taught so no gender of ethnic group has the market cornered.

You can say that these represent high hurdles, but I leave you with this thought –

Leadership is an opportunity to serve. It is not a trumpet call to self-importance.

Donald Walter

 

 

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A New Roadmap

The Road map

My colleague Brad Federman shared the following thought the other day-

Don’t chase people. Be an example. Attract them.

Work hard and be yourself.

The people who belong in your life will come and stay.

Just do your thing.

I was pretty struck by the profound elegance of this statement both for individuals and for organizations. I wish I had of heard this before giving life and career advice to my millennial aged children.

We hear a lot these days as to whether or not we should follow our passion, our purpose, or just the money.

For me after a lot of sleepless nights and mistakes along the way I have decided to accept purpose as my person lighthouse. I like the lighthouse metaphor because unlike GPS or a map it doesn’t show you the route, it just illustrates where the rocks are in your path.

I have a passion for the concept of employment brand which in my definition is how your culture translates into reality for your customers and employees.

Wells Fargo pretty much screwed the pooch the last few weeks with their brand. A group of employees stole a bunch of money from customers.

Management says it was a few bad apples. Former employees say it was and is an aggressive sales culture where you live and die by the numbers.

It makes me very nervous. This was the foundation of the Recession. I was in banking at the time. When you incentivize a bunch of people to write loans without meaningful consideration for whether or not they can ever be paid back you build a house of cards.

The CEO of Wells Fargo apologized. As Senator Elizabeth Warren said that isn’t enough. No senior manager was fired. No executive to date has been required to pay back the bonuses they were paid on those “earnings”, including that CEO. Their brand sucks.

Your organizations employment brand is the perception by current and future employees of what working in your organization is like.

Some organizations enjoy a very strong employment brand. I would include Google, Starbucks, Accenture, and Zappo’s in this arena. People have a pretty clear perspective about what these organizations value and the profile they seek.

In addition to an employment brand you have a leadership brand. I think Wells Fargo’s leadership brand sucks even more than their employment brand.

Leadership branding includes some concepts that Malcom Gladwell and Stephen MR Covey have discussed and I find intriguing.

In Gladwell’s latest book, David and Goliath, he discusses at some length the concept of legitimacy – which he defines like this:

• Those whom are governed have a voice in the process; their input is sought and heard.

• There is a dimension of predictability and consistency in the application of the law or standards.

• The application of the law or standard has to be administered fairly and objectively, you can’t   have disparate treatment without a clear and compelling reason.

Legitimacy is a concept you don’t hear much about in organizations or B schools, but then I especially like to tweak it a bit further by adding a discussion of Covey’s three levels of trust.

In his hierarchy the first level of trust is deterrence, trust that comes from authority or position. This was a broadly accepted concept for hundreds of years provided first to rulers or religious leaders and embedded in Calvinism that God only allowed “good” people to create wealth and prosper so they were endowed with that trust.

The next level of trust Covey calls competency based. In many cases there is an assumption that anyone who achieves a management role has that competence, but we all know better. In most cases their competency is limited to technical proficiency; their emotional intelligence capacity and social intelligence are rarely considered.

I have encountered literally hundreds of recent MBA graduates who are supremely confident in their ability to lead based on their shiny new diploma demonstrating “mastery” of the concepts. You can have mastery without practice.

I just finished reading The Toyota Kata, which talks about among other things why almost no other organizations than Toyota have ever mastered their model and achieved the productivity increases they enjoy.

Most organization employ the steps, but don’t understand the underlying philosophy that is deeply embedded in the culture. It is systemic, not just systematic.

The highest level of trust in Covey’s hierarchy is identity based trust which incorporates both your competency and you character as demonstrated by your applied values and behavior to create credibility.

I personally believe that to a large extent leadership as opposed to management is founded in legitimacy. Leadership is entirely relational versus hierarchical, it has to be earned rather than bestowed with a title or position.

I recently started working with a recently retired member of an elite military unit about his transition. We are exploring things like Covey’s trust model and Simon Sinek’s Start With Why and Leaders Eat Last.

His reaction is “duh”. These concepts have been embedded into the culture he spent his adult life to date in. The fact that these are an epiphany in the private sector stunned him a bit.

He shared with me that being a leader in these units is the easiest job in the world. Everyone is highly competent. Everybody is committed to the mission. The leader blocks and tackles.

Sounds like identity based trust and legitimacy.

It also sounds like the foundation of employee engagement. In addition to trust and legitimacy, personal competency is expected and reinforced.

It starts in the selection process. If you don’t buy into the values and you aren’t congruent you don’t get in the boat.

You read studies every day how attracting and retaining talent is a critical priority for both human resources and C level executives. I don’t thing automated applicant management systems and better compliance is going to build an organization like Brad described.

Don’t chase people. Be an example. Attract them.

That is simple, but not easy. It requires a different leadership model and organizational paradigm, but all you have to do is look at the statistics between engaged and unengaged and the “Return on Investment” is pretty clear.

I don’t know about you, but I think I am going to heed Brad’s advice and maybe keep trying to share it with others…….

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My Personal Litmus Test

Are You Providing Value?
I am a pretty big fan of James Altucher. If you haven’t read any of his stuff you might want to check him out on LinkedIn or Fortune Magazine or any of the other places that he publishes or his podcasts.
He is sometimes irreverent and always self- deprecating. He talks about his successes, but mostly about his failures.
He says things that a lot of people might find alarming like how owning “stuff” like houses and expensive cars is not advisable because ultimately it owns you.
His latest blog post, The Difference Between Making Millions and Failure I found especially interesting. He sums it up quite simply- add value.
You hear a lot these days how advising people to follow their passion, find their purpose, etc. is all bullshit. I don’t know that I agree with that in the entirety, but I think there is value in asking how what you do and how you do it is going to add value to others or the world in general.
My last blog post explored why I do what I do. I think most organizations, public and private do a pretty shitty job of bridging people, specifically employees, customers, and shareholder/stakeholders. We see them as inherently competing interests.
I have shared before that a significant survey on management and leadership concluded that the single biggest reason most people pursue leadership or management roles is because they want to make more money.
Not make the organization better or grow their people. That is not adding value.
I have occasion to come into contact with a number of not for profit organizations on a regular basis ranging from very large organizations like education and health care providers to local service providers with a much narrower focus.
I use the term not for profit as opposed to non- profit very deliberately. The point that I try to make with these organizations is that profit at its most basic is the amount of revenue that exceeds expenses and there is nothing fundamentally immoral or amoral about how that excess is distributed.
I find that the idea that an organization should goal for and achieve solvency on a regular basis doesn’t always make me very popular. The idea that the organization should be held accountable to have a clear and compelling reason that it exists and perform its services in an efficient manner is seen by many as an elitist or purely capitalistic viewpoint. I disagree.
I think my viewpoint is consistent with Altucher’ s proposition that the absence of that clear value proposition is a fail.
I am a social entrepreneur. I don’t think all profit is equal. I think profit that increases social equality and opportunity is better. The broader the stakeholder base you impact the more value you are creating.
Just so I am clear that I am not singling out not for profits I want to share that I find Seth Godin to be one of my favorite business authors. I don’t put him up on a pedestal or see everything that he writes as either brilliant or that I agree with, but he provided some simple points for would be entrepreneurs that I think have application for every organization-
• If you have never been paid for your product or service it is a hobby, not a business.
• If the only people who have ever utilized your product or service are friends and family it is a hobby, not a business.
I have encountered a number of not for profits who believe that their first and most compelling objective is to raise funds and invite donations to their cause.
On the other hand, I see organizations that do provide meaningful services and a clear and compelling value proposition who are severely criticized because they do things like a successful business-
• Create and execute a business strategy
• Create a strategy to attract and retain the talent necessary to drive the organization and pay that talent competitively.
Those NPO’s get Godin’s point, if nobody is buying your product, you failed the test.
On a simplistic level I have incorporated some of Altucher’ s advice into some of the things I teach.
A great example is feedback. I am a big fan of constructive feedback. People ask how they know their feedback is constructive and I use these guidelines-
•    Constructive feedback is based on observations and facts not reactions and speculation.
•    It focuses on performance not on a person.
•    It can be tied directly to the performance of the person or the team or both.
•    It is timely and specific.
•    Progress is both measurable and obtainable.
•    It is part of a process, not an event.
I believe that feedback that meets these criteria adds value, if it doesn’t meet these criteria it doesn’t and you should keep it to yourself.
I think this should be the litmus test for everyone we hire in our organizations. 
How will they add value and can they articulate that? Candidates that recite their resume and experience leave me bored. That is the minimum standard, the easy part.
I use a nautical analogy when I talk about the hiring and talent acquisition process for most of my clients. 
I tell them in terms of boats you are a canoe rather than a battleship. Every person on your boat needs to be a rower. The only other value add in a small boat like a canoe is being food, and I don’t think consuming people is good.
Our human resource models have been based for years on consumable/disposable employees. Frederik Taylor said people are stupid and lazy. Our employment models have been based on compliance and obedience for generations. We provided security in return for obedience.
And then we discovered outsourcing, downsizing, and automation.
I don’t let individuals off the hook either.
Businesses do not exist to provide jobs and security for their employees. That is hopefully one objective and part of their value proposition, but not that premise exclusively.
That is why I agree with those that say that employees are an equal shareholder (read responsible party) for employee engagement. They also need to add value.
So every day I come to work and ask myself if I am adding value to my clients and my community. That is my aspiration and I think I get it right the majority of days.
What would happen if everyone and every organization adopted that perspective? I wonder…….

 

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Why I Do It!

An excellent quote by Jeff Bezos in a recent blog post by Brian Wong took me back to my undergraduate days.

The quote “Focus on what won’t change” was a significant contributor to my decision to pursue a career in what was then called Personnel, much to the chagrin and disappointment of my academic advisor.

He told me, “You are really smart and focused, Personnel is kind of a dumping ground unless you are on the Labor Relations side”.

You have to remember that this was over three decades ago when organized labor was a powerful force and those employers who did not have a represented workforce were determined to stay that way.

My response to him was that in my brief career I had made two observations-

·         At the end of the day people (or talent or whatever you want to use to describe the collective talents, skills, attributes, and efforts of the people you employ) are important no matter what sector, industry, or field you want to work in

·         Most organizations don’t seem to “get” that and do it very well.

Even in the adolescence of my career it seemed that if you don’t want your employees to organize and have to negotiate with them collectively the best way to address that was to build relationships based on mutual trust and respect.

People smiled and patted me on the head about my naiveté, and wished me well.

My first job was at a place where we had pretty much done everything wrong. All of our employees were members of one of the eight unions and governed by one of the thirteen bargaining agreements in place and for good measure we had managed to get ourselves sued by the Federal government for systemic discrimination against two different minority groups so the government stepped in to give us “guidance” on the hiring of all our skilled crafts jobs.

My next job was with a more enlightened Fortune 100 whose philosophy was that we didn’t want any third party intervention between our employees and us. Third parties included unions, government agencies, special interest groups, and of course members of the legal profession. I thought that made much more sense.

I have to give that employer credit they were much more pro-employee and even when we went through the blood shed of the eighties with downsizing, rightsizing, and outsourcing we tried to maintain some sense of dignity on the part of the affected employees.

I also got a chance to be exposed to some “new” ideas like the total quality movement and a gainsharing experiment where we involved employees in redesigning processes and even took a radical step of involving them in discussions like rising health care and worker’s compensation related expenses and sharing the savings with employees both directly and indirectly.

My next gig was with a smaller medium tech employer who was interested in exploring socio-tech and self- directed work teams. My colleagues and I after serious resistance from senior management were able to put in place a model that demonstrated that when employees are committed rather than complying and aligned with organizational goals you can accomplish amazing things.

Then it was time for me to step into the abyss of self-employment and hang out my shingle as a management consultant trying to sell my services and ideas to employers regionally and nationally.

  I called my model Compliance to Commitment.

In his 1991 book, Why This Horse Won’t Drink, Ken Matejka describes commitment: “Commitment is the act of being physically, psychologically, and emotionally impelled. It means that employees gladly give up other options.”

 Employees choose you and your organization over any of their other available choices; you have become partners in your organizational mission!  This creates a powerful image.  If you are a CEO or a business owner, it almost sounds like a fantasy.

I like to think this was one of the early discussions and models of what we now refer to as employee engagement.

Roger Deprey created a model, the Human Resources Pyramid, a series of six questions that he believed every employee asks in a particular order.  Deprey further stated that less than 15% of organizations in the world have their employees reaching the top of the pyramid and asking the final question:  How can I help? 

Maybe I am reaching, but I see more than a few parallels between Deprey’s six questions-

•             What is my job?

•             How am I doing?

•             Does anyone really care?

•             What is our function/mission/goal?

•             How are we doing?

•             How can I help?

and the more recent models espoused by thought leaders like Simon Sinek (Start with Why) and Patrick Lencioni’s Organizational Health models.

In my experience, corporations and organizations spend an enormous amount of time and money talking to employees, shareholders, and other stakeholders about mission, vision, culture, and values as abstract principles.  Before employees can embrace your vision or mission, they need to understand where they personally fit in the organization and how you, as an executive, see them and their contributions. 

There are five distinct elements to my model, and I believe each to be essential and directly correlated to Deprey’s questions.  These are the elements:

• Respect

• Responsibility

• Information

• Rewards

• Loyalty

I am not going to go into defining these in detail because I have done that ad naseum in other posts and publications.

 Here are my recommended actions to drive compliance (little “c”) to Commitment (big “C”):

• Treat your employees with respect by providing clear expectations, meaningful feedback, and an opportunity to collaborate with you in achieving your goals and theirs.

• Treat them as intelligent adults by holding them accountable for performing their tasks independently and competently given clear direction and guidance.  Provide clear boundaries of acceptable and unacceptable behaviors and performance, and enforce them consistently.

• Provide them with the big picture and context of how their jobs, skills, and activities fit into the larger purpose of the organization- answer their question “What is my job?”

• Provide a clear “line of sight” between their performance and their compensation and rewards. If it takes you longer than 20 minutes to explain the basic structure of how you make decisions about employee compensation, it is too complicated.  If you are afraid to explain the targets you use and how you make decisions, it is similarly flawed.  Remember that human nature is to distrust what we do not understand.

• Do not expect more “loyalty” than you are willing to provide. I define loyalty as a mutual agreement that, while someone is my employee, they commit themselves to being engaged 100% and fulfill their responsibilities with our mutual respect.  If they need additional clarity or information, they make me aware of that, and if they have an issue, they allow me to address it. Envision loyalty as an agreement between adults: we will continue in our relationship as long as it is mutually beneficial to both parties.

So you might ask what is in it for me as a leader?

• 84% of highly engaged employees feel that they can positively impact the quality of the organizations product or service versus 31% of disengaged employees.

• 72% of highly engaged employees feel they contribute directly to improved customer service versus 27% of disengaged employees

•68% of highly engaged employees feel they can directly impact costs versus 19% of their disengaged counterparts.

• An average total shareholder returns of 24% with organizations with a population of 60% or more of employees describing themselves as highly engaged. Where high engagement is between 40 to 60% of the population the TSR drops to 9.1% and when it drops below 25% the average TSR is negative.

• At Best Buy they were able to correlate a .1 percent increase in engagement on a five-point scale to a $100,000 annual profit increase per store.

• JC Penney found that stores in the top 25% engagement scores produced 36% higher per store operating revenues and 10% higher sales per square foot than their counterparts in the bottom 25%.

The bad news is that this is old news, we have known this for close to ten years yet many organizations have yet to embrace these models, in fact the number of disengaged employees has been increasing at a faster rate than engaged employees.

I didn’t have this data back in 1993, but the fact that we are still leaving this much opportunity on the cutting room floor is why I do it.

I still believe that having the right people, focused on the right things, who are committed rather than complying is the most important competitive advantage any organization has and that will never change!

So where do you go from here?

 As you might suspect I have several suggestions:

Define your culture. As leaders creating the culture and ensuring clarity is your key role.

Hire hard- manage easy. My colleague Joseph Skursky uses this motto to describe his technique of investing the time to hire the right people, don’t try to “train” them to be right.

Hire for congruency. The more alignment you have between the employee’s values and the elements described in Dr. Willingham’s model the more likely you will have alignment and engagement.

Ensure managers have the “tool kit” and that they reinforce your values. Leadership and management are different skills, but there are an essential set of management competencies that all managers must have and be able to demonstrate. I would submit the closer to the frontline the more critical those skills become.

Give employees a chance to commit rather than comply. The numbers speak for themselves. The model works.

Be flexible about process and ruthless about principle. People who cannot or will not embrace your values will never be engaged. You owe it to them and yourself to “free up” their future.

If you are unfamiliar with some of the concepts I mention in this post just hit my blog or Google and do a key word search…..

People really are our most important asset ….

 

 

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Why Engagement and Culture Are Failing!

After almost four decades as a human resources professional, c level executive, and management consultant I remain convinced that changing the way we attract, retain, and align people remains the most significant competitive advantage we have available to us, and we continue to squander that opportunity.

Employee Engagement isn’t a new concept anymore and although there are many detractors that say it is merely another “program” there is a lot of evidence to the contrary that suggest the problem isn’t the concept, it is about execution.

The percentage of engaged or highly engaged employees has pegged at about 30% with the number of actively engaged employees actually creeping up from 17% a few years back to over 20%. The costs of that lack of engagement are in the billions annually.

In my experience engagement must be approached as a culture rather than a program and there are some very bright people out there who agree with me.

One of those people is Josh Bersin, principal and CEO of Bersin by Deloitte who shared his research from 6000 companies and over 2 million employees that concluded that the most important element in high performing employment brands is culture and values, followed by career opportunities and confidence and leadership.

Their research concluded that in terms of a positive employment brand these factors were 4.9, 4.5, and 4 times more important than compensation and benefits. Interestingly the “work-life” balance we hear about so much was rated as less than half as important.

Millennials rate career opportunities in the first position, but other than that their responses are the same as preceding generations.

For those of you not familiar with the concept of employment brand, your employment brand is how both current and potential employees perceive you as a career choice. Organizations with strong employment brand have a huge competitive advantage in the war for talent because people seek them out.  Think organizations like Google, Amazon, Starbucks, and Zappo’s.

So how do we keep shooting ourselves in the foot? Well some recent data from the Workplace Institute gives us a clue, (thanks to Michael Stewart of WorkEffects for sharing).

They conducted a survey of a little over 1800 people broken down as a third human resources professionals, a third line managers and a third employees on who “owns” culture and to me the results were a little scary.

·         Over 30% of the HR respondents felt the HR leadership is responsible, however 90% of managers and 97% of employees surveyed disagreed.

·         26% of managers surveyed felt that it is the executive team, but 89% of HR professionals and 91% of employees disagreed with that assumption.

·         29% of employees surveyed say employees drive culture (and 40% of Millennial’s) with 91% of HR practitioners and 87% of line managers disagreeing.

It gets better, there was no overlap between what employees and either managers or HR considered the three most important drivers of culture either!

The three groups also disagreed on what either kills or impedes culture as well with employees citing employees felt that “not having enough staff to support goals,” “unhappy/disengaged workers who poison the well,” and “poor employee/manager relationships” were the major obstacles to maintaining a positive workplace culture.

So what does this tell us?

As Dustin McKissen pointed out Fred Taylor’s adage of telling employees what they need is still alive and well!

Here are a couple of other problems-

A multi-year study by international consulting firm Development Dimensions International yielded some interesting information (at least to me)-

• The highest quality leaders are 13 times more likely to outperform the competition

• Only 38% of those surveyed (12,000 line executives and 1900 HR executives) rated their leadership of leadership development as high or very high.

• 60% of those who applied for leadership roles indicated their primary motivation was economic- they wanted to make more money!

Our leadership models are based on compliance, not commitment or engagement!

Here are some other issues-

·         If you ask most HR executives what the most important contribution they make to the organization they support 7 out of 10 will tell you compliance with state and Federal regulations. That doesn’t sound like culture!

·         The art and science of recruiting has been dumbed down. I happen to believe that highly effective recruiters whether they are on your staff or hired specialists have enormous value in helping you identify the attributes and skills of top performers in both current employees and applicants. The new systems in many cases believe, I have an app for that! We just load a formula into the computer and it does that pesky work of screening. Therefore, the role of recruiting can be delegated to more junior people who manage the process.

·         Recruitment and selection has become much more impersonal. I have a client who is seriously walking away from an organization she feels could be a great fit and who has demonstrated an interest in her because a glitch in their system continues to demand she complete a supplemental questionnaire she has already completed…twice. You can’t pick up a publication without reading about an applicant’s experience with a hiring organization where they applied, were interviewed or both and never heard from the organization again. Current applicants are often potential future hires, customers, or know a great hire, but we turn them off.

As you might suspect this isn’t good for your employment brand!

As to the fact that employees are the only group that identified unhappy/disengaged employees and less than competent management as being major impediments to creating or sustaining culture as a change agent I don’t know whether to weep or cheer!

Employees get it, why don’t we?

So what do I propose?

• Be proactive in developing, implementing, and reinforcing your culture.

• Recognize that the foundation of your organization and success are based on understanding and embracing the three levels of trust, not just deterrence and competency.

• Ensure that you understand the implications of congruency and you either build it in or retrofit your organizational models to embrace it and reinforce it.

• Only hire and promote leadership candidates with both the appropriate attributes and the right skills.

I also see a clear meaningful role for the Human Resources function and I can assure you it isn’t owning culture!

When I look at the opportunity costs represented by more effective recruitment and retention, re-designing health care to include health management and address issues like social literacy and individual responsibility and the creating of meaningful employee engagement strategies on our society I have to admit I am puzzled about why more organizations don’t “get it”.

I understand that it is hard work. I understand that in some cases the ability and necessity to do things like create trust based relationships, establish clear performance expectations, provide meaningful feedback, and take appropriate corrective actions necessary to align performance with organizational goals is still in many organizations considered a soft skill, but the data is becoming more and more available and compelling.

I don’t believe that becoming certified as a HR professional, or gaining your black belt, or Six Sigma will necessarily make you a better leader or manager.

I believe the role fits into three distinct buckets.

•     Technical skills -The proliferation of rules and regulations has indeed made the profession more complex as has the application of technology, phenomenon like social media, outsourcing and global workforces, and related challenges. We need to be technically proficient, not only in our craft, but to understand the businesses and organizations we serve.

•     Project Management- Similar to the Total Quality Management movement I believe human resource competency in core areas needs to be deployed broadly and deeply rather than be seen as a departmental competency. It is fundamental to the management/leadership role.

•     Facilitation - We need to help our client organizations recognize that by building relationships with individuals as people first and resources second we can create enormous gains in sustainability, productivity, and profitability through alignment of organizational and individual goals.

Some of the more recent studies on employee engagement criticize many organizations approach because they look at employees as a passive participant rather than an active stakeholder.

The good news is that employees are telling us in growing numbers (especially the group that makes up 25% of the workforce) that they see themselves as participants in defining organizational culture which is the foundation for engagement.

We have everything to gain here with nothing to lose except an artificial sense of control that we don’t have in the real world.

Let’s fix this!

 

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In Search of Leadership

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In Search of Leadership

People that know me know that:

·         I am passionately committed to helping organizations create new models of working together.

·         That I have spent the last three plus decades reading the models of others as well as synthesizing and testing my own models to do things better.

Today I experienced an interesting juxtaposition of a couple of things that spoke to me.

The first is this quote from Aurelius Augustinus, who most of us know better as Augustine, the Bishop of Hippo and perhaps one of the most profound influences on the Catholic Church.

The concepts of employee engagement and employment branding are getting a certain amount of press these days with both supporters and detractors. I am firmly in the supporter camp based on both my research and my personal experience.

Much of the discussion around engagement is who owns it and how does the care and feeding of an engaged environment take place. I find that Augustine’s direction from 1700 years ago was pretty accurate then and now.

More recently I had occasion to read Ken Matejka’ s Why This Horse Won’t Drink, and I discovered an “updated” version of what Augustine was expressing-

Commitment is the act of being physically, psychologically, and emotionally impelled. It means that employees gladly give up other options.”

When I am conducting leadership sessions with senior executives I often pose the question to then “Can you imagine a time in your organization where employees arrive every day physically, psychologically, and emotionally impelled to fulfill the goals and objectives of the organization?”

Most of them are honest enough to admit that would be a stretch, but they then wistfully remark how that would be pretty awesome.

In my mind an engaged environment is when that occurs. It is about alignment, clarity, and trust; not about morale, happiness, or cool perks.

The problem is we are doing it wrong.

A multi-year study by international consulting firm Development Dimensions International yielded some interesting information (at least to me)-

·         The highest quality leaders are 13 times more likely to outperform the competition

·         Only 38% of those surveyed (12,000 line executives and 1900 HR executives) rated their leadership or leadership development capability as high or very high.

·         60% of those who applied for leadership roles indicated their primary motivation was economic- they wanted to make more money!

Our leadership models are based on compliance, not commitment or engagement!

Dustin McKissen, founder and CEO of McKissen and Company, talks about this in his recent blog post in Inc Magazine, http://on.inc.com/29U7O4r, The Rotten Core of Every MBA Program.

He specifically cites our ongoing infatuation with Frederick W. Taylor and his Scientific Management models-

While Taylor's theories are viewed as harsh and impractical today, his work was still cited in every class I attended that discussed the roots of modern management science. What's not often discussed is how little Taylor thought of the people who actually produced products in the factories he studied.

 While there are people who say that Taylor isn’t relevant anymore when I hear academicians and business leaders refer to people as human capital I am not sure I am buying it.

When I watched what happened during the recession where many organizations retreated into their old behavior and told employees, don’t complain about your compensation, you are lucky to be employed, and downsizing once again became the primary management strategy to improve productivity I still feel Fred’s presence.

It is amusing to hear those same executives now complaining that they can’t recruit and retain the talent they need to run their business- go figure…

When 60% of the applicant pool for leadership roles cite more money as why they want to be leaders I am pretty sure creating an environment where people are impelled is not top of mind.

So what do we do?

My recommendation is we build a new model with the following elements:

·         Be proactive in developing, implementing, and reinforcing your culture.

·         Recognize that the foundation of your organization and success are based on understanding and embracing the three levels of trust, not just deterrence and competency.

·         Ensure that you understand the implications of congruency and you either build it in or retrofit your organizational models to embrace it and reinforce it.

·         Only hire and promote leadership candidates with both the appropriate attributes and the right skills.

As I have written at length on these areas previously I will save you from my rambling today. If the subject interests you check out my website at www.newparadigmsllc.com.

We are leaving billions on the cutting room floor every year, by hanging on to the old models.

We need change and if not now when and if not us than whom?

 

 

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Managing Whole People- Revisted

I remember being trained as a manager all those years ago and reflecting that much of what was provided as leadership were things we do to people rather than with people.

I explored this at some length in my first book, Managing Whole People, and since then it seems like our awareness if not our practices have changed as we have begun to recognize the billions in opportunity costs we are spending every year as the number of disengaged continues to grow.

In the almost eight years since I published my book the data continues to roll in and awareness seems to be growing. That gives me continued optimism, as does the unwillingness of the next generations to settle for compliance like many of my colleagues and I did.

It has been conversations with brilliant colleagues like Marty Lucas at 2020Thinkology and the Roceteers that continue to get me excited that there are others out there who share my vision of a different model, and it is way better and more exciting!

I have long believed that one of the fundamental problems we have in our society is our reluctance to embrace and implement the concept of working with and managing whole people. 

As I have mentioned on multiple prior occasions I think the Industrial Revolution did a lot of harm to the notion of whole people and Frederick W. Taylor and his theory of scientific management and the creation of the concept of white collar and blue collar didn’t do anything to enhance the relationship.

When I was trained as a manager in the seventies the model was planning, controlling, budgeting, etc. Those are all things you do to people and things – not with them. That model never “fit” for me.

Technology has its place, but like scientific management too often it has been imposed rather than integrated as part of a broader systemic solution.

A number of events have transpired over the intervening years  that causes me to revisit this topic again. One was a lively discussion I had with two colleagues about an upcoming round-table we are going to do about why the current models aren’t working and the importance of esoteric concepts like culture, change, and other relationship type behaviors have on enterprises of all kinds.

We are experiencing what I would call a relationship crisis. In the United States things like employee engagement, trust in management, and job satisfaction are at all time lows. We also have huge issues with productivity, turnover, and the cost of managing and delivering health and health care. Health care is devouring a huge part of our GDP with most of the solutions I see being proposed still over- looking the relationship dimension, disappointingly I would include Obamacare in that observation.

The other events that I encountered were in the course of responding to some questions about the role of human resources in organizations and the importance of fit in hiring and selection.

The first question dealt with whether or not HR as a function should align themselves with management or employees in an enterprise. I indicated my response as neither, HR should focus on helping management and leadership with what I see as the three key elements of healthy, functioning relationships-

  • Clarity- what is the mission or value proposition of the organization. Why does it exist?
  • Context- how does the role of the individual employee fit into the larger mission and how do they know they are performing appropriately.
  • Alignment- creating systems so that line of sight is both very clear and reinforced by other organizational systems. I believe a big part of the role of “new” HR is to train and reinforce those elements as being essential to everyone in management not just leadership and human resources.

This approach requires some re-calibration and new skills. Alignment is about execution. Organizations don’t exist to “fulfill” individuals they exist to meet the expectations of their stakeholders; that is how I define effective execution. Everything else is secondary.

One colleague indicated that if we were to ask CEO’s they would tell us the primary value of human resources is compliance- I shared my belief that that is precisely why we have the engagement, productivity, and trust issues we are “enjoying”.

The other colleague took us to the proverbial woodshed over our obsession with fit. She even went so far as to indicate that focusing on fit was likely discriminatory and creating an environment of adverse impact. Fit in her mind is way too nebulous and subjective. Recruitment and selection is all about skills and tasks. When I indicated I had successfully hired for fit for years without ever having my methods or outcomes questioned relative to compliance or impact she indicated I represented an attorney’s wet dream- I simply had not  been sued yet. My reaction was a combination of being slightly annoyed by her condescension, but mostly amused.

I have in fact encountered the legal profession a number times ranging from government agencies to plaintiff’s attorneys. In addition, I have been retained as a plaintiff’s expert witness on best practices. To date my track record of prevailing without settling is in the high 90th percentile.

If your fit model leaves out people of color, ethnicity, differing sexual orientation, and all the other things that are discriminatory on their face you have a shitty profile and will likely struggle hiring the talent you need.

At the risk of generalizing I suspect that like my other colleague she has a compliance bias. When I commented that most new managers who fail (40% in their first 18 months), she indicated that she had never had to replace a candidate she placed.

That is a great track record. I rather suspect that somewhere on an intuitive level her process includes some consideration for fit.

Some months ago I had a chance to read an exceptionally good blog post from Thomas Stewart about the difference between brand and branding. He describes branding as the marketing, sales and other strategies we use to try to position ourselves in a certain way with our customers, communities, and shareholders. Brand on the other hand is how they see us. That is what I describe as alignment or true engagement.  I believe strongly that building that into the fabric of your organization is much better strategy than trying to bolt it on.

I think organizations like Starbucks, Zappo’s, Google, Virgin Airlines, and a few others have real definable brands. I also believe that fit is an important component of their hiring process and that their human resources professionals look beyond skills and attributes in their hiring and selection processes. I will go even further out on the limb and say that compliance is not their primary mandate or value proposition.

People aren’t assets per se.  Let's eliminate the concept of human capital from our vocabulary. Their efforts and contributions when they are aligned with the interests of the enterprise become powerful assets, but the ownership of that contribution always rests with them. I don’t think we can extract those efforts and contributions; we can only create an environment where they share them.

In his cult book Why This Horse Won’t Drink, Ken Matejka describes commitment as being when

“Employees feel physically, psychologically, and emotionally impelled. They voluntarily give up other options.”

Perhaps I don’t have a full appreciation for capital or technology, but I have yet to encounter a situation where I saw either become physically, psychologically, or emotionally impelled. Come to think of it I don’t think I ever saw a brand or an organization become impelled either- only people.

Contrast that definition to the current statistics showing less than 30% of employees defining themselves as engaged with the number at the other pole disengagement being at 17% and rising costing the U.S. economy alone an estimated $200 billion annually.

I know the recession is theoretically over, but are we really in the position of leaving $200 billion a year on the cutting room floor?

So I guess until I see a better model I will continue to try to work with whole people and to try to create environments and relationships where they feel physically, psychologically, and emotionally impelled toward the goals of the organization because as leaders we have provided them with clarity, context, and alignment and I can't tell you how excited I am to be in the company of others like Marty Lucas, Mark Rowland, Heather Wilde and others who are out there building lighthouses...

For me that defines effective execution, and that is what impels me. What do you find impelling….?

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Wrong Solution

Sigh, I Don’t Think He Got This One Right
I just read where the President has signed a bill proposing that all companies with more than 100 employees will be required as part of their equal employment opportunity filing to report compensation by gender, ethnicity, and other factors.
My concern is that while this may lead to “transparency” it will not necessarily lead to pay equity.
I am old enough to remember when affirmative action planning actually had teeth to it. The idea was to identify inequities in employment and address them. Not surprisingly white men tended to have much higher representation in the higher level ranks than women or people of color. I will take heat for saying this, but some of it was deliberate some of it was a function of unintended consequences of less than optimal practices.
Promotion to higher level positions in part is a function of experience and training and hiring and selection. Most of us have heard of the “halo effect”, this is our tendency to hire and promote people we are comfortable with, i.e. people like us. Although we have been aware of it for over fifty years I still see it happen frequently. Most organizations quite bluntly do a generally poor job of hiring across the board.
What we found with EEO reporting that in many cases women and minorities weren’t “qualified” for senior roles because they didn’t have the experience necessary to move up. That is where the Affirmative Action part comes in. Every level has “feeder” groups from which the next generation candidates come from. The idea is by changing the composition of the feeder group you can change the candidate pool. Although this playing the long game several organizations I worked with embraced it recognizing that the demographics of the workforce was changing and it was not just a legal requirement it is good business. These days we refer to it as encouraging diversity. While we are certainly in no position to declare victory I think that organizations who sincerely embrace this process see much better representation of the workforce.
I also call it good business. Succession planning at every level is a fundamental component of good business planning. Scrambling to find talent when someone dies, retires or quits is a sucker bet. High performing organizations don’t operate that way.
So now let’s talk about how this applies to pay.
Properly executed good compensation planning takes into account the qualifications, experience, and performance of employees including the context of market conditions. Compensation planning is art as much as science.
Looking at job titles and compensation by themselves without consideration for factors like experience, qualifications, training and performance leaves out some critical data.
While I recognize that some people might be surprised by this I consider myself almost a feminist and a huge advocate of equal opportunity. When experience, qualifications, and performance are equal there should be no disparity in compensation.
As I said before however, compensation is not an exact science. I have shared the lament of many an executive who paid a premium for an outside superstar based on market conditions and performance somewhere else who feels disappointed with what they got. Just look at the musical chairs being played at the C level in organizations every day.
I a perfect world we pay for performance and I am going to go out on a limb and say that government at every level rarely provides a great example of that concept.
Mandating equity rarely works.
I am probably one of the few people I know who doesn’t think Obamacare is an abject failure. It is flawed as I pointed out in my eBook Plan B- An Alternative to Obamacare, (I will even be smug and point out I published it before it became law.
Access to care is appropriate and necessary for the long term. The problem is that the model is strictly compliance based and doesn’t address some of the underlying issues like the lack of personal responsibility and education to encourage individuals to participate in managing their own health. It also doesn’t provide navigation through a very complex health care delivery system that is byzantine to the average person.
Compensation inequity purely based on gender, national origin, or other factors unrelated to performance and market isn’t just wrong it’s dumb!
Less than 30% of the American workforce consider themselves to be engaged or highly engaged at work. As many as 17% are actively disengaged.
We don’t just have a pay equity issue, our whole approach to managing people is screwed up.
There are ways to fix it. Comprehensive and systemic approaches that look at whole people and integrated solutions, not patches.
So Mr. President while I applaud and support your intent this one isn’t a solution I can get behind…
As always I would be very interested in hearing opposing viewpoints…

 

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HR's Elusive Value Proposition..

So What Is HR Exactly?
I was having lunch recently with a client and a very capable human resources professional that I was introducing to him and he posed that question.
He wasn’t being sarcastic or demeaning. His organization has never hired a professional human resources person in their 50-year history so he was genuinely curious about what he could expect from making this kind of investment.
I have to say as someone who has been in and around the profession for 30+ years that still remains and interesting question for me.
Is hasn’t been that long since a national survey of CEO’s and COO’s couldn’t frame a consistent answer to that question. Even scarier to me was that the majority of senior level human resources practitioners responded that the most important role they play in their organization is compliance.
I find that utterly disheartening. With four generations in the workplace, employee engagement stalled at lower than 30 percent, and organizations indicating that the acquisition and retention of talent is a key issue for the foreseeable future and the “top” minds in HR think that compliance and keeping the lid on are our highest value added activities…
Years ago when I was working in manufacturing the Total Quality Movement was just starting to gain momentum. Someone had the brilliant insight that building quality in was way better than bolting it on. Quality professional began evolving from functionaries to internal consultants, building appropriate processes and deploying them throughout the organization rather than the old school end of the line approach. It makes sense.
I have seen a number of those in the HR movement seeking to piggy back on that approach with lots of cross certifications in Black Belt and Six Sigma.
In my mind the problem with that is that those address intellectual processes. They are about building things.
When we are dealing with people we are dealing (or should be) with emotional processes.
The most important part of any high functioning relationship is trust and there is not a recipe for trust.
Stephen MR Covey brilliantly describes the three levels of trust, deterrence, knowledge based, and identity based. As you might suspect he believes as I do that identity based is by far the most important of the three.
Therein lies the problem with traditional HR. Compliance is all about deterrence. Six Sigma, Black Belt, and HR certifications are all about competency. Oops we left out that identity based thing.
I want to be clear that the first two are important elements to getting to identity based trust. Knowledge based has competency and character as foundational elements and you need those to be an effective manager.
Effective managers are critical to every organization and management is different than leadership. Bluntly you don’t need armies of leaders in an organization.
So to answer the question my client posed I would submit my answer-
•    HR helps the organization answer the Why question posed in Simon Sinek’s Golden Circle.
•    HR helps identify the values and attributes that are fundamental to and congruent with the Why. As I have said before creating alignment for people who already share your values is much easier than trying to “fix” people.
•    HR helps identify and deploy the competencies that reinforce the performance that we desire and ensures that those are practiced consistently across the organization. Those include setting expectations, giving feedback, course correcting, and coaching among others. Those competencies belong to managers, not HR.
I recommend that HR gets way better about helping organizations answer their WHY and reinforcing the values and way less about compliance and certifications.
We need to teach managers and emerging leaders about how to trust and be trusted. Trust is not an entitlement. It doesn’t come with a title, position, certification, or degree.
There are skills, attributes and abilities that are foundational to that process and they can be taught and learned and in my opinion those are part of HR’s charter as well.
So in the final analysis HR doesn’t manage human capital, we don’t master compliance. We teach organizations and people how to create an environment where people join up rather than comply and we share a vision and goals…..

 

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