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 ….

Finding Your Purpose

Sometimes a picture really is worth a thousand words and I think the one shared above (thanks to Kathleen Schaefer and A.W. Tozer) may be worth millions, at least to me.
I spend a good deal of my consulting practice, and indeed my career, in coaching people and organizations towards what we call employee engagement. I know that engagement has its detractors, but I think that the data on organizations that are aligned relative to values, purpose, and goals makes a pretty compelling case for why it works.
In my experience where engagement has failed it is a function of definition and implementation. In my experience effective engagement is about culture and alignment. It isn’t a survey, a program, or a brochure. You have to do the work.
One of my favorite thought leaders, Simon Sinek, talks about starting with why on an organizational level is one the critical steps to achieving true leadership.
Patrick Lencioni captures much of the same conceptual framework in his book, The Advantage. When I look at his model I see a lot of time being spent on finding the why first as a leadership team and then building that into the fabric of your culture.
Culture, like engagement is one of those concepts that makes a lot of executives roll their eyes. I think that is because they either don’t understand it or they are too lazy to do the work.
I personally agree with Chatman and Cha-
“One thing is guaranteed: a culture will form in an organization, a department, and a work group. The question is whether the culture helps or hinders the organization’s ability to execute its strategic objectives.”
When it is done properly, like the way Angela Duckworth describes it in her bestselling book, Grit, the power of passion and perseverance, you get this-
“…Culture has the power to shape our identity. Over time and under the right circumstances, the norms and values of the group to which we belong become our own. We internalize them. We carry them with us. The way we do things around here and why become the way I do things and why!”
I read an article recently that said that the worst advice that we can give our children and the emerging generations is to follow their passion. While I am not sure I entirely agree with that statement, I do believe that maybe figuring out your purpose is a better roadmap.
A recent conversation with a colleague about some concepts I wrote about years ago have some application here.
When the Founding Fathers wrote the original constitution, there were two primary ideas that formed the core of our new union. The first was the idea of personal property; the idea you have the right to acquire property and pass it along to your heirs. This is the heart of the capitalist system. 
The second principle that we hear much less about is the principle of personal competency. This is the idea that each of us has the right and the responsibility to craft our own future, to be what we want, and to reinvent ourselves without regard to our heritage or beginnings. 
When industrialism began to emerge we saw the personal competency principle begin to erode. We ran out of new territories to colonize and pioneer. The industrial age required labor to staff its factories and production. We offered security in return for compliance. 
Give up your personal competency and we will provide security in the form of employment, retirement, and health care benefits. I’m not going to say the great industrialists did this willingly or altruistically, but we can agree that by the 1950s, it was commonplace for employers to provide “fringe benefits” including paid time off, pensions, and employer-paid health care as part of the inducement to recruit and retain the labor we required. That was the “social contact” under which our parents and grandparents were employed. Then we broke the contract.
Maybe I am reaching, but what the Founding Fathers described sounds a lot like purpose to me.
So how do we build this into the current reality?
My roadmap would say that we begin by embracing Sinek’s premise that as organizations we start with Why? What is our organizational purpose?
Next engage your employees. Engaged employees see themselves as being in partnership with you. They care about your organization, your customers and your goals. They are committed not compliant.  One of the “ancillary” benefits of engagement and partnering is that employers with high engagement scores outperform their competitors in key metrics like productivity, profitability, and retention. They do things with people not to people. Engagement is consistently underrated by most organizations.  It requires trust, respect, responsibility, information, rewards, and mutual loyalty.
To assure that you will have engagement build congruency into your hiring processes.
There are multiple levels of congruency; 
• My view of the activity, 
• My view of my ability to do the activity, 
• My willingness to do the work to be proficient, 
• My belief in the product or service we offer, 
• Whether or not the activity is aligned with my personal values.
I would submit that if you hire people who are congruent with your organization on all five of these levels chances are you are also aligned at the purpose level. They get and share the why!
Hire and train good supervisors. I have been a human resource professional for thirty years; here’s an unavoidable truth: people join companies and leave managers. Poor supervisors and managers cost businesses millions of dollars every year in turnover and lost productivity. Make sure that when you hire or promote someone, they have the right skill set. This doesn’t have to be horribly expensive. You can hire these skills or in many cases there is excellent supervisory training available through your local Chamber of Commerce or community college. Executive coaching is great, but most of your employees don’t work for an “executive”. Poor frontline supervision is relatively cheap to fix.
Purpose plays a role here as well. 
Studies done by Development Dimensions International and the Workplace Institute respectively indicated that 60% of supervisory/leadership respondents indicated they pursued leadership roles for primarily economic motivations and that fifty percent of middle managers surveyed rejected responsibility for context, alignment, and attending to morale issues as being core competencies or responsibilities of their role!
See my comments on congruency!
There are workplaces out there were individual and organizational values and purpose are aligned. You can recognize them because they are kicking their competitor’s ass on every key performance indicator you choose to measure!
The nice thing about this model is that it is collaborative. Employees have a role just as important and accountable as the other stakeholders. There is no free ride just a model based on shared respect, clarity, and mutual accountability.
So as leaders let’s ask ourselves two key questions?
•    What’s our purpose?
•    What’s my purpose?
If we can’t answer them, we have work to do…….

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!

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?

The Leadership Journey

The Journey Continues

This week I will complete the second round of my Advanced Leadership program. We call it Advanced because we have screened the participants to be sure that they have already been exposed to concepts like setting expectations, giving feedback, and other fundamental requirements of managing others.

We are trying to focus on concepts that are a little less crisp like building trust, leading teams, managing change, and related ideas.

So why do I focus on skills and concepts like those you might ask.

A few statistics to reinforce what I will freely admit to being a personal bias.

A DDI survey reported some things that I believe we should pay attention to, among them were the following:

·        Organizations with high quality leadership are 13 times more likely to outperform their competitors in key areas like financial performance, talent attraction and retention, and employee engagement.

·        The same survey rated only 38% of their internal talent pool for leadership as being good or very good, and 50% were rated as missing one or more critical skills.

·        Managing change was identified as the most critical skill for managers, 48% of those included.

So a reasonable question is how credible is this date. The survey base was 12,500 operational leaders and almost 2000 HR practitioners representing North America, Europe, Asia, and Australia and New Zealand so I would say this is pretty credible stuff.

When I add that to even more recent data from a Gallup Poll reporting that 51% of employees rate themselves as neutrally engaged with 17.2% actively disengaged I think the issue becomes more compelling.

So what you might say, other than the fact that organizations with high engagement consistently outperform their less engaged competitors in every key performance metric from financial performance to employee retention so what.

You can argue that we don’t really know what engagement is and that we are spending billions on programs without credible results and my answer would be bullshit.

You can call it what you want. When I began experimenting with my own version in the late 90’s I called it moving from compliance to Commitment. When I read Lencioni’ s books The Five Dysfunctions of a Team, and more recently The Advantage, what he describes as organizational health sounds a lot like employee engagement to me. I find myself in good company because Lencioni and I agree that the measure of employee engagement is not morale or happiness, but organizational performance through alignment. The other things are positive byproducts.

The critical link in creating these engaged environments is leadership, especially leadership at the frontline and middle levels. The same Gallup poll concluded that employees supervised by highly engaged managers are 59% more likely to be engaged themselves.

I believe that many of the reasons organizations experience epic failure with their engagement initiatives can be answered by one of Lencioni’ s three biases:

·        Sophistication – we get caught up in the technology and systems and leave out people. I see this in HR a lot, we design technically elegant compensation or performance management systems that are useless to the manager trying to use them.

·        Adrenaline- with the advent of the internet we want everything now. We don’t want to do the work and expect instant gratification. I get this occasionally from a client, “we did the survey, when can I expect better results?”

·        Quantification- if it can’t be reported to the sixth decimal point we shouldn’t measure it or believe it. We forget we are dealing with people.

I start my journey with two pretty unsophisticated concepts- Trust and Congruency.

As anybody who has read the Five Dysfunctions knows this is Lencioni’ s first dysfunction. I like where Stephen MR Covey goes even better where he actually dissects trust into its three levels of Deterrence, Competency, and Identity based.

We don’t teach those levels very effectively. We have very high reliance on the first two. We have become a society obsessed with certifications and bona fides. The problem is we can only take us so far.

If identity based trust makes you squirm you will really hate congruency. Congruency gets into the relationship between personal and organizational values and the fact that we live on three levels-

·        Intellectual, or I think

·        Emotional, or I feel

·        I am, the visceral level from Maslow’s hierarchy at safety and security.

Research shows that when our intellectual conflicts with our emotional as a leader you are screwed 85% of the time. When our intellectual is in conflict with our visceral or as Seth Godin calls it the lizard brain, you are really hosed.

It is very hard to be intellectually engaged if you are hungry or afraid. That is why Simon Sinek tells us the most important part of leadership is to create that safety for our team.

Congruency also becomes very important in leadership selection as the vast majority of leadership candidates from the DDI survey indicated the reason they aspired to leadership is economic, they wanted a promotion to make more money or gain status.

Yes, Houston, that is a problem. Tough to focus on trust and the congruency of other people when you took the job to advance financially and don’t really give a rat’s ass about the safety and security of your team.

A single poor manager anywhere in the hierarchy can cause devastation, the higher up they are the worse.

As the experts say “Your leadership culture is defined by the worst behavior you are willing to tolerate”.

And you do have both an organizational and a leadership culture. High performing organizations have a deliberate one and are ruthless about protecting it. Lower performing organizations have an accidental one…

So I guess what I am saying is that after you have screened for the technical competence and the skills to do those basics like establishing clear expectations, giving constructive feedback, taking corrective action, and coaching then assess to see if your leadership cohort understands and can embrace these other less complicated, but more critical skills.

You will never have engagement without trust and congruency and I think the numbers make it clear that engagement is a pretty significant competitive advantage to walk away from.

So that’s why I keep preaching my model…….

Why Trust Matters

The Trust Factor

I have always been clear about the criticality of trust in every relationship, but it is always nice to get some statistical validation from a credible source like HBR in this recent post- https://hbr.org/2011/12/why-trust-matters-more-than-ev/.

As a recovering HR executive I have preached this message for some time, similar to my rants about the absurdity of leaving the gains from employee engagement behind because you think they are too soft and squishy to measure or impossible to create and leverage.

Trust is all about forming relationships from a different perspective. Taylorism, commonly known as scientific management is as dead as the hardbound encyclopedia.

I was discussing the other day a difficulty a colleague was having helping a client understand that occupation and personhood are separate and distinct. Many of her clients see their entry level, unskilled employees as a caste rather than performing activities. They complain that those workers are focused exclusively on the next quarter or fifty cents per hour rather than the big picture.

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 survey conducted by Sibson & Co., an international compensation consulting firm had some interesting conclusions about employee’s perceptions about their compensation.

- While a significant majority of employees surveyed 65% indicated they were satisfied with their pay level (their salary range compared to other positions) and 71% indicated they were satisfied with their current pay, 57% of the employees surveyed indicated that they were dissatisfied with the way their employer awarded pay. For the purpose of this study process means the determination of individual pay increases, promotion decisions, and progress through the pay structure.

- 16% of the employees also indicated that they were highly likely to leave their current employer.

- Most employees still highly value traditional forms of pay increases, with 19% rating merit pay number 1, 20% overtime pay, 18% cost of living allowances, and 12% individual incentive opportunities.

- The survey found little difference between the generations about compensation.

This reinforces that the idea of “equity” in terms of perceived fairness and the rationality with which pay is delivered is equal to or higher in importance to the rate themselves above “living wage” thresholds.

So what does the survey tell us, a couple things.

·        Employees don’t understand and therefore trust the way compensation is delivered in their organization.

·        Once they get above that living wage/survival threshold that sense of trust and equity becomes increasing important.

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.

As a former executive and HR practitioner I can assure you that my colleagues in the compensation business swaddled themselves firmly in those first two levels, ranging from “compensation strategy is need to know and you are not cleared for that, or alternatively developing models that looked awesome to your colleagues at the local SHRM chapter, but were designed with HR rather than our manager/clients and employees in mind.

Identity based trust in the model or systems was nowhere to be seen.

I am not going to pretend that designing good compensation systems and performance management systems does not involve some complexity and technical skills, but our job is to de-mystify those models not make them more opaque.

People rarely trust what they don’t understand.

In this day an age of consumerism and social media the accountability to earn and sustain trust rests with management 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 reinenforcable.

The alternative is pretty grim from everything ranging to attracting and keeping talent to keeping your customers…

The Long and Winding Road

The Leadership Journey

Leadership is not for the faint hearted. It is very much a journey rather than a destination. The other thing about it is that leadership is bestowed on you, it doesn’t come with a declaration on your part or a promotion, or a place on an org chart. It is a gift.

You may be part of what is referred to as your organization’s leadership team, but that doesn’t make you a leader. Leadership is when people agree to follow you and it is a privilege that can be retracted at any point.

I am pretty concerned that right now we are observing leadership failure on an epic level.

I have been a corporate human resources executive, C level executive, and management consultant for over thirty years and I am miserably disappointed with the progress I see to date.

One of my colleagues pointed out in a blog post last week that the old management/leadership model (in the old days we treated them the same) were about planning, directing, controlling, budgeting, and others things we do to people rather than with people.

I saw a post recently that said the new organizational currency is trust. My reaction was that this isn’t new, we just don’t want to acknowledge it.

Stephen MR Covey goes even further to identify three levels of trust-

·        Deterrence, trust coming power or authority

·        Knowledge based, trust coming from perceived competence or credentials

·        Identity based, trust coming from shared experiences and intimacy

Most of our institutions are based on at best the first two levels of trust. The work ethic to a large extent takes its roots from Calvinism. Rich people were inherently good and to be obeyed. Poor people were poor because they weren’t good.

Scientific management, the prevailing management model for generations, picked up right where that left off. This was the concept that manager/leaders thought and workers did. You broke down work into small monotonous pieces that could be mastered and completed without a lot of mental horsepower.

By dumbing the work down, you could also pay a lot less. There are some that would like to return to that model with robotics and automation.

I see a bit of embracing the knowledge based trust model in our infatuation with things like lean, six sigma, and the relentless pursuit of credentialing and certifications in almost every profession.

Everybody wants to be bona fide. It is interesting to me to see the new tendency towards MBA graduates to adding that to their business cards as an implied form of credentialing or competency. I applaud people who have done the work to complete that process, but I have yet to encounter an MBA curriculum that creates leaders.

That identity based trust thing is a real bugaboo! There is not a credential or certification in the world that ensures that. You have to do the work, and that work is hard.

My former profession of Human Resources is taking a real ass whooping these days. You can’t crack open the internet without someone commenting on how obsolete the profession and practices are and why maybe the function should be eliminated.

I hate to admit that to an extent I agree. Many HR practitioners are very skilled in compliance, building lots of rules and infrastructure or making sure that their organization is in compliance with infrastructure imposed by the government because of the way we treated employees in its absence.

Compliance will never optimize organizational performance and lead to identity based trust.

A very well respected colleague of mine posted a great article on 10 things that are bad for your organizational culture. To a large extent I agreed with her.

I do take a couple of exceptions though.

She like a lot of others really have their undies in a wad about employee engagement. They are especially ferocious in indicting organizations who use employee engagement surveys as being a tool for ratting out employees and unnecessary because managers and leaders should know how their employees feel and what their issues are without a survey.

I have two thoughts on that:

·        If you are using your engagement survey to identify malcontents, you have baseline cultural issues way beyond anything your engagement survey can fix.

·        I believe Dunbar’s Number. This is the idea that very few of us can maintain highly personal relationships with more than 150 people at a time.

I know when I was an executive I tried to be very visible and approachable by all the employees in the organization. I know as my scope increased and those organizations got bigger I felt like I got less effective doing that.

I don’t think an engagement survey should be your only or even primary way of sensing where people in your organization are and how they are doing. I also don’t think having a meeting with your employees annually to discuss their performance and how it links to compensation is effective.

That being said I think that engagement surveys can be a tool. I think that while we should abandon the annual performance appraisal process unless it is merely a summary of frequent, periodic discussion about performance we need to give employees feedback.

We also need to explain how we make decisions about their compensation, career growth and a bunch of other things that are really important to them.

Those discussions should be with their manager, not HR. That is how you build identity based trust. That means their manager has to have those skills and be held accountable to do that work.

My colleague doesn’t like employment at will much either. I actually am in support of it to the extent it is practiced the way it was intended.

As it is intended employment at will creates parity in the employment relationship, either party can end for any legal reason. The key is either party. Employers don’t like that part.

It is not a tool to build loyalty, that is a different model. Loyalty goes back to my old friend identity based trust. It is mutual and it is measured in terms of contribution and alignment, not tenure or morale. It is a relationship of equals.

The cold reality is that most organizations exist to meet the expectations of their stakeholders. Providing employment is ancillary. Smart employers realize that recognizing employees as equal stakeholders and appropriately balancing their interests is good for the interests of the entity. I call that employee engagement.

The current state of leadership concerns me. When I look at the current election cycle our choices are pretty underwhelming.

I will be blunt; I am not a Trump fan. He is no leader in business or anywhere else. Anybody that operates from a model of dividedness is not leading. His models are exclusionary and prey on people’s angers sand fears.

I underwhelmed by his competition as well.

I am very disappointed in our Congressional leadership. I don’t agree with everything the President has done, but the blatant obstructionisms of the Republican leadership are hurting the country. Since his reelection the Republican leadership has clearly stated their objective is not to run the country, but to thwart any of his initiatives.

As recently as today announcing they will use their majority to refuse to consider any Supreme Court nominee to honor the right of the people to participate in that process is incredibly poor leadership.

What will be their recourse in the event they lose the general election and the next President to make that appointment is also a Democrat? After all the people will have spoken…….

I am not going to claim that the opposition party hasn’t resorted to similar tactics, but since third grade I was taught that retaliation is not leadership.

Leadership is hard work. It is not for everyone and no one should be ashamed for not seeking it. On the other hand, we are at a time and place where true leaders are in short supply so maybe we need to reexamine our models and figure out where we go from here…

Millennials and Leadership Fails

Millennials, Employee Engagement, and Leadership Fails

It is interesting to watch both the behavior of the Millennial generation and all of the energy and dialogue they are creating.

I think the dialogue is good. Millennials make up 50% of the workforce today and that number will increase to 75% over the next ten years. It is amusing however to see our desire to lump them all together with sweeping statements about who they are and are not.

The last couple of weeks there have been two different situations involving Millennials and leadership opportunities that have played out over social media.

The first was the young woman from Yelp who was frustrated with her living situation and lifestyle opportunities given her economic situation living in the Bay area and not making a lot of money. She chose to use social media to address her concerns in an open letter to the CEO. Didn’t work out well, she lost her job for “policy violations”.

There was a lot of discussion about whether or not she was a victim or overly entitled. That has been debated ad naseum so I won’t cover it here.

I will say that her being hired by Yelp was a management failure. I encourage my clients to build congruency into their hiring process.

Congruency includes things like- the job is consistent with my values, I believe in the product or service, I am willing to do the work to be proficient, I see the activity as being something meaningful and engaging.

When I read her list of concerns I don’t think that was covered in her interview.

I don’t want to confuse anyone by stating I believe in lifetime employment, but even in the tour of duty or gig economy I advise employer and employed to have that congruency discussion.

When you look at what happened and how she handled her issues from the beginning I am going to go out on a limb and say that didn’t happen in her hiring process.

The second story is at the opposite end of the spectrum.

A young woman was hired to work in a retail store. She was so excited and committed to the product and the brand that she posted pictures of her wearing the company’s garments on social media as an encouragement to her network to share her enthusiasm and purchase and wear the clothes as well.

She did that until she received a post on Instagram from the CEO that she didn’t fit the image of the models he wanted representing the brand- essentially she was the wrong body type.

WTF- you tell a committed employee it is okay for you to sell our product, but essentially please don’t wear it or god forbid if you wear it don’t promote it and identify it as our product.

Epic leadership fail. The average employee unless they are working in a very small organization has very few personal interactions with the CEO or any senior manager. How awesome that this interaction is telling an employee they aren’t suitable to represent our brand!

No surprise the young woman has terminated her association with the company. Her story has also been shared over social media.

There are these related concepts called employee engagement and employment brand.

Employee engagement is what Ken Matejka in his book, Why This Horse Won’t Drink, calls being physically, psychologically and emotionally impelled. Employees willing give up other choices to align with your organization. That translates into higher levels of productivity, higher profitability, higher retention and a bunch of other things that CFO’s drool over and human resources professionals wring their hands over trying to create.

It is a good thing. Organizations with high engagement outperform their less engaged counterparts on every key performance metric. The tough part is that it isn’t a survey or a program, it is a culture. You never get done reinforcing it.

That is where employment brand comes in. Employment brand how your employees, alums and potential employees see you and describe you to others. It is very important and it isn’t just about your recruiting brochures and Linked In and Facebook profiles.

Every organization has an employment brand. The smart ones manage their employment brand to ensure they are top of mind with the talent they have and want to acquire.

Engagement starts with that brand. Being able to recruit and manage people who are preconditioned to be supportive of your organization and goals – physically, psychologically, and emotionally impelled so to speak, makes it way easier to manage those folks and get high performance from them. Changing people is really hard, especially since we are so poor at it.

The emerging generations talk with and share perspectives much more than previous generations. Just as executives have old boy’s clubs (and hopefully soon old girl’s clubs) that they tap into to attract and retain candidates these people talk to each other.

Not only do they talk to each other, but they trust each other way more than they trust us. (For more on why read my blogs and articles on the Social Contract.)

So here are my thoughts-

·        Manage whole people, not just their knowledge, skills, and abilities.

·        Hire individuals. Don’t get caught up in group think and treat them all the same whether that is based on gender, age, nationality, sexual preference, or any of the other stupid labels we dream up.

·        Lose the expression human capital from your business vocabulary. If you have to call them something call them people or talent.

·        Don’t expect any more loyalty and commitment than you are willing to provide.

·        Never, never pee on employees who are committed and passionate about your brand and your company. They are incredibly valuable.

·        Do the work to create and sustain employee engagement. It is better, period.

Revisiting The Social Contract

The Social Contract Revisited
Over this weekend I found myself reading and thinking about a number of things I saw posted and debated on the blogosphere. 
There are a number of different postings out there about a young woman who directed a letter/post the CEO of her organization deploring her personal working conditions, primarily her compensation vis a vis, 
 the cost of living in the San Francisco Bay area and the affordability gap for basic food and shelter and wages.
The young woman was released from the company (fired) and part of the discussion was whether or not she was terminated for taking her view and her issues public. The CEO has indicated he was not personally involved in that decision.
There are a number of issues that this incident has provoked discussion about including, but not limited to –
•    The ongoing debate about a “living wage” and who is responsible for providing it
•    Whether her taking her issues to the public represents an act of courage or a sense of entitlement that we have branded the Millennial generation with
•    Whether the action taken by the organization was appropriate and within their purview
Another excellent post talked about engagement versus empowerment and how we should measure it and whether or not it is still relevant.
I personally believe that engagement is a culture and a process rather than a program or an event and I think that if we look at the organizational performance of organizations where employees rate themselves a highly engaged as opposed to marginally or unengaged the question of the relevance of engagement becomes pretty obvious.
I have long believed that engagement is about alignment. When I have a clear understanding of the goals of the organization, can see the direct impact and relationship between my efforts and organizational performance, and a direct link between my efforts and performance and the reward structure of the organization, and finally I feel that my personal values are aligned with that of the organization I am inclined to do my best work.
Our existing social contact has its roots in compliance, not engagement. We wanted employees to do what they are told with a minimum of pesky questions and the need to be coached, motivated, or otherwise individually managed.
There are many who believe (and I am among them) that the primary purpose of our educational system was to train a supply of people who had the basic skills to follow direction and understood that performance equated to complying with authority. Do what teacher says and get the A. In return under the old model you were provided with a degree of economic security.
Then the 70s and 80’s happened and off-shoring, down- sizing, and right sizing to optimize financial performance became acceptable.
Another great post talked about that HR bugaboo, turnover. The author points out a number of things that we should take into account when we look at turnover-
•    The fact that few of the Millennial generation embrace the idea of lifetime employment
•    That who is leaving and why they are leaving may be way more important than how many
•    That certain types of employment are transactional and essentially temporary and that is ok.
I have long thought that one of the most appropriate measures of highly effective executives/leaders is their talent legacy. How many of their staff have gone on to significantly greater responsibility either within or outside the organization.
Yet another great post talked about the entitlement mentality. He talks about how every organization in the world is basically created to generate value for the stakeholders. Simply put that means that the end goal isn’t to provide jobs for employees. That is a side benefit.
On the flip side employees don’t exist to serve their employers. They rent their talents, efforts and abilities to the employer as long as it works for both parties. 
Enlightened employers have figured out that when you see your employees as stakeholders rather than human capital and you hire and develop people who share your vision, values, etc. and reward appropriate behavior they are likely to stay longer and contribute more during their tenure with you.
I feel legitimately bad for the young lady who finds herself unemployed in a high cost of living area, but on the flip side I have to ask myself these questions-
•    Was she not aware of the compensation being offered for the position she accepted and the requirement that you stay in a department for a year before transferring to a different (I am assuming higher paying) role?
•    She made a cognitive decision to live in one of the highest cost of living areas in the U.S. Did she look at the total picture before accepting the job? Has she considered relocating?
•    What other actions did she take before she addressed her concerns to the CEO in a very public forum?
I can relate to much of her experience. The community where I currently reside has major issues with the affordability index which is the cost of living relative the average wage rate. We have largely stagnated for close to two decades or more since the severe reduction of the extraction economy the community was built on. I am deeply disappointed with community leadership that after that much time we have made little meaningful progress in addressing that issue.
I find it kind of repugnant that a big part of our allure to some employers was the ability to pay relatively lower wages to a pretty well educated workforce, something that may be changing as the state is embracing a new minimum wage that will be among the highest in the country.
It is also ironic to me that we have an issue for employers requiring staff with more vocationally oriented than academically oriented skills, positions that do pay a living wage, and we have made minimal progress addressing that.
We have issues in our society with the wage gap, access to health care and a number of others.
I don’t happen to be among those who feel that the government is best suited to address those issues. I am more supportive of collaborative models involving all the sectors than increasing codependency.
My perspective may seem harsh. It isn’t intended to be.
We are leaving literally trillions of dollars on the table annually in the U.S. alone from lost productivity from disengaged employees, employee turnover, and the direct and indirect health care related costs of employee health care expenditures relating to stress, depression and other related issues.
We need a new social contract that is based on mutual respect and mutual responsibility. I can’t see anything but upside. Can you?

E

Employers Be Advised!

I have been seeing a few posts of late that reinforce some things that I have known and talked about for some time:
•    We don’t just acquire talent or human capital; we hire and hopefully retain whole people.
•    Contrary to everything you read Millennials are not slackers, uninterested in making a contribution, and generally the most awful generation ever…
•    All Millennials are not motivated by the same things (imagine that)
•    EVERY employer has an employment brand; some have an intentional one…
As a former human resources professional, c level executive, and management consultant I have watched the evolution of how we approach the attraction, retention, and occasionally engagement of staff for over three decades now.
I chose interesting timing (2008) to publish my first book, Managing Whole People, on my personal approach to managing talent. I say interesting because during the recession the concept of treating people respectfully, building engagement into your culture, and appreciating the return on investment of engaged versus unengaged or marginally engaged employees didn’t get a lot of traction.
I think we lost ground we had been gaining in that area for the ten years proceeding. With the unemployment numbers increasing I watched employer after employer fall back into their old habits.
The nice thing about the intervening years is that employee engagement is hardly conceptual. The studies are out, have been vetted, and clearly demonstrate the value of an engaged workforce.
There are still detractors who believe that engagement is voodoo or another fad, but the people who believe that also believe that Human Resources highest and best value is compliance and administration. Many of those detractors live and work in human resources departments. Changing your paradigm is hard…
We aren’t a whole lot better at managing talent than we were thirty five years ago when I entered the corporate world.
The problem is as employers we are facing an emerging workforce that sees themselves as equal stakeholders in the employment relationship.
They have expectations-
•    They expect meaningful work
•    They expect their employer to partner with them in developing their portfolio of skills
•    They interpret loyalty the same way employers do, talk is cheap action is clear
I have to say I continue to be amused when I hear employers who used the recession as leverage to defer pay increases and hiring, reduce workforces, and off shore and outsource whine about how employees just aren’t loyal. Some of them even manage it with a straight face…
Todays’ employees, especially Millennials seem to have embraced some pretty interesting ideas promoted by several of my favorite pundits-
From Malcolm Gladwell they have embraced legitimacy-
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.
From Stephen MR Covey they operate from an advanced interpretation and expectations around 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.
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 (and Millennials seem to agree) that to a large extent leadership as opposed to management is founded in legitimacy. Leadership is entirely relational versus hierarchical, it was be earned rather than bestowed with a title or position.
This is a new paradigm for us old timers…
The other issue we must face is that the new workforce doesn’t rely on us to validate our employment brand, our work environment and how we treat our employee stakeholders.
Social media has provided them with a platform to research and validate or invalidate everything we say about ourselves.
Here’s a tip, if you think your website and recruiting brochures are your employment brand you are in deep shit.
 If you think you don’t need to proactively manage your employment brand you are deluding yourself.
The competition for talent, especially experienced talent is increasing not decreasing. The Department of Labor estimates that employee turnover costs the U.S. economy over $200 billion annually.
Having a great employment brand is not going to guarantee that people stay forever, but it will help you attract the right people and have former employees promote you as a great place to work.
So two things to remember-
•    Millennials represent the largest  emerging sector of the workforce
•    They see things differently…