Popular Posts

Sunday, 17 February 2019

Too Much Darkness, Not Enough Light? Design Your New Lifestyle!

I recently came across a quote, unattributed, which struck chord with me.

"It is better to light a candle than to curse the darkness"

The distinction between light and darkness permeates all religions and a great deal of literature where light is always seen to overcome the negativity of darkness.

2,000 years ago the sages of Kabbalah, Jewish mysticism, referred to light overcoming darkness at the creation of the universe. The sage Isaac Luria in the 16th century said that there was a spark of light in the nothingness (darkness) that contained all of space and time. Please note, Albert Einstein in his General Theory of Relativity defined the concept of the space/time continuum in the 20th century.

When the spark expanded the universe was created and darkness retreated. Again please note, Rabbi Luria wrote this 500 years ago.  

It is a remarkable description of the Big Bang theory of creation and long before clever scientists espoused it.    In essence it describes light as being both a physical and a spiritual phenomenon.

Now we talk glibly of distances measured in “light years” but do we ever stop to consider the enormity of the statement.  Light travels at 186,000 miles per second so for each light year it travels:

60 (seconds) X 60 (minutes) X 24 (hours) X 365 (days) X 186,000 and that doesn’t take leap years into account .  

When we consider that the farthest end of the universe according to eminent scientists is probably in excess of 1,000 light years away and is constantly expanding anyway, some of the light that we are seeing started out at or just after the Big Bang so what are we really looking at?

We are certainly not looking at what is happening on any planet, star or galaxy right now and we never will.

The remarkable facility of light to overcome darkness is exemplified by lighting a candle in an empty football stadium at midnight and even though there is total darkness all around, the candle light can be seen from any angle.

It is a wonderful metaphor for positive and negative thinking.  

There are even "light" and "dark" words in our vocabulary that can create an atmosphere in a conversation even without realising it.  For example:

Light Dark
Yes No
Happy Sad
Bright Dull
Grow Diminish
Like Dislike
Love Hate

and there are many many more. The most intrusive is that all-pervasive word "BUT".  Someone once told me that word eliminated everything said before it and everything said subsequently was negative.  Quite a thought.

In fact we had a speaker to my Vistage CEO peer group some time ago who banned the use of BUT for the whole morning and it was quite extraordinary how the level of discussion turned to the positive.

We live in a world where the vast majority of media news is sad, bad or generally dark and it takes an effort of will to overcome it.

I do recall someone saying that he was constantly reading about the dangers inherent in alcohol so he had given up - reading.

Do a test this year.  Just listen out for DARK words insidiously intruding into your conversation and either eliminate them or try to replace them with LIGHT words. The whole tenor of the conversation can change and for the better. It is certainly worth a try.

We need light in our lives more than ever and anything that we can do to achieve that end is to be applauded.  

It is never too late for a notional New Year Resolution so try this one:

"You gotta accentuate the positive, eliminate the negative, latch on to the affirmative and don’t mess with Mr In-between",

in the words of the old song.

Visit the Vistage UK website
Follow me on LinkedIn, Twitter and Facebook

Sunday, 10 February 2019

Vulnerable to a Major Customer? What About Your Suppliers!

Over the years several companies with which I have been working have quietly and dangerously become vulnerable to a major customer.

It is axiomatic that the sensible approach is to keep the customer base as broad as possible with none accounting for more than around 15% of turnover.  This should, as far as possible, be accomplished not by reducing the direct influence of a major customer but rather by directing the marketing effort towards other sectors of the market.

However customer creep can and does happen and before you know it, one of them starts to account for a really major part of turnover.  I recall a business in domestic lighting dealing with a major outlet in the UK for their range of products.

Over a long period of time the customer placed more and more orders and at the same time, the demands started to increase.  In end, they accounted for more than 80% of turnover and whatever they said they wanted, the supplier had to comply.

It wasn’t a matter of “jump”, it was “how high do you want me to jump?

When I warned the Managing Director (and owner) that the company was massively vulnerable, he said firstly that he couldn’t refuse a good order from a good customer and in any case he had a great relationship with the buyer.  In fact he used that unpleasant comment of: “I have the buyer in my pocket”.

Guess what happened?  The buyer moved on, a new buyer was appointed and brought existing relationships with non-branded manufacturers.  Within six months my client had lost the account and was effectively out of business.

A salutary tale but what about your suppliers as well?  I had a client who manufactured a high tech product and one day called me to put off a meeting as he had an important matter to deal with.  Later in the day I happened to be in Manchester and, lo and behold, there was my client walking towards me.

He said: “ I have just been to see our lawyers.  One of our major suppliers who manufactures a special component exclusively for us, has gone into administration.  We have had to make an offer to buy the supplier’s business from the administrator just so that we can maintain supplies and keep our business going.

Another salutary tale.  We keep our eyes firmly fixed on our customers, and rightly so, but it should never be at the expense of watching the supply chain where events can be and often are detrimental to the company’s success.

The problem is, of course, that we can become complacent.  Orders are coming in, the customer may be starting to flex muscles but we can live with that and at the other end suppliers are happy to deal with us and seem to give us good service.

The question is, how often do you put these assumptions to the test?  The order book is usually very visible throughout the business but is the supply chain visible as well?

At the current stage of the global economic cycle some industries are booming and as a consequence demands on the supply side are becoming overwhelming.  Suppliers can be so busy that smaller customers by definition are expected to take a back seat.

The result is that the service to their customers suffers, relationships with the suppliers become fraught and everything becomes a problem rather than an opportunity. Those are perfect conditions for fire fighting rather than working to a sensible plan.

The really key imperatives in any business are the relationships with customers and the markets in general, relationship with significant players in the supply chain and, above all, the health and well being of the critical members of the team.

That last is possibly the most important and needs to be at the top of the agenda when critical factors in the business are being considered.  Make sure that they are all high on the agenda for regular top team consideration.

Visit the Vistage UK website
Follow me on LinkedInTwitter and Facebook

Sunday, 3 February 2019

A Toxic Team Member? Do Something and Quickly!

When I started to publish the blog, more than nine years ago now, I resolved it would be written to maintain certain values and resolved that it never becomes self-indulgent. Foremost among these values was that it would not be overtly or covertly political.  

For example I have   something of a reputation now among my Vistage CEO peer group of revealing  some aversion to the BBC Today programme primarily because of the standards of interviewing. Of course we just cannot hide (would that we could) from the insidious and all-pervading influence that they wield in these pre-Brexit days. We can always switch off, of course.

I cannot hide, however, when one of the members of my group bemoaned to me the discovery that one of his prized team members was indulging in office politics and something had to be done about it.

When Dr Henry Kissinger left front line politics to become a full time academic he commented that his experience of the ferocity of  university politics made him long for the peace and tranquillity if the Middle East and I can fully understand his concerns.

The fact is that whenever and wherever we have a group of intelligent people nominally at one to deliver successful business outcomes, the situation can often be blighted by  an individual who is more concerned to construct a position that is more individually advantageous than one that contributes to the overall success of the organisation.

Another value I laid down was to encourage as far as possible topics that engender a positive outlook rather than look for situations that cry out for correction. An admirable objective but one that needs to be examined from time to time.

Wise sages say that it is far better to put emphasis on things that are positive and doing well rather than spending time, effort and emotion on correcting  unsatisfactory positions in the business and I agree with that wholeheartedly.

However there comes a time when things get out of kilter and the influence of the business terrorist becomes evident. In its worst manifestation this is a member of the team whose output and performance levels are high but whose attitude, behaviour and lack of team ethos overcome the positive.

It is the gloom-monger, the naysayer and the rumour provider who constantly gets in the way of being a successful team player.

One of our Vistage US speakers says that we hire on skills and fire on attitude and that is a maxim well worth examining.  When we recruit from outside the business we naturally look for a replacement for the dearly departed and occasionally even a direct replacement.   This means that experience and technical abilities become essential whereas we actually need someone who can merge effectively into the team and contribute as such.

On that basis the last thing that we need is someone who has a personal axe to grind and whose whole attitude militates against good team ethics.

The problem is that this is often a creeping disease and it can take time to for a leader to realise that there is a problem.

In any case it is usually a problem that must be resolved if the team is to operate effectively.  Make no mistake, everyone on the team knows the problem and waits for some action to be taken from on high.

The question is always what to do about it?  On the one hand the individual’s performance is acceptable but the attitude and behaviour is not.  Can this be changed? Probably not so what is the remedy?

Remember that we usually can’t change people’s attitude and behaviour.  The best that we can accomplish is to build an environment which enables the individual to change - if they so desire.  If they don’t then surgery may be the best option based on the realisation that no individual however productive can be allowed to destroy a team and that can easily happen if we don’t take action.  

A disruptive team member is always a toxic influence and it is not good to wait for the eventual response of “What took you so long?

Visit the Vistage UK website
Follow me on LinkedIn, Twitter and Facebook

Sunday, 27 January 2019

Can You Define the Purpose of Your Business? It Answers the “Where Are We Going?” Question!

Some years ago I attended a meeting in London to hear Theodore Levitt, the renowned Professor of marketing at Harvard, and apart from being totally inspired, I came away with a little mantra that I have used on many occasions since.

It is: if you don’t know where you are going any road will take you there.

Coincidentally I recently discovered a version of the same mantra which goes like this:

“If one does not know to which port one is sailing, no wind is favourable". (Lucius   Antaeus Seneca (4BCE-65CE) Roman stoic philosopher).  There is nothing new under the sun!

In both cases, of course, it is a matter of purpose, not objectives.  Accountants love objectives because they are easily monitored, easily measured and as a consequence can be used for praise or, rather more frequently, for  reprimand.

The definition of purpose is more intangible. Purpose has to have a base line of stated shared values that are immutable and that are based on moral, social, socio-political, environmental and other criteria whereas objectives are, more often than not, financial.

I am an avid collector of maxims and another that I like is:
People need to know two things. How am I doing and where are WE going?.

Leadership is all about the people and their needs (obviously) so that they are kept aware of their personal progress and that of the business, compared to the stated values of the organisation.

Because we are dealing with human beings the “How am I doing?” question is intensely personal and needs to be treated as such via regular and confidential one-to-ones.

The great Dan Pink in his YouTube animations and his book “Drive”, examines more deeply the factors and the environment that motivate people to perform at their best, simply stated as follows

  • Autonomy
  • Mastery
  • Purpose

People need to be given freedom and the autonomy to undertake their role in the best way possible and hence with the most satisfactory outcome.

That freedom to make decisions rather than wait to be told what to do and how to do it results in enhancement of the ability to perform and consequently in improved mastery of the task or subject.

Overall it needs to be achieved  with a sense of purpose that has been constantly instilled and has become the cultural centrepiece of the business.

It is all a matter of at what level the leadership is prepared to trust the people, how far will they go in paying them the respect of accepting and welcoming their abilities and desires and to what extent is all of that recognised and in some way rewarded.

The key to it all is the stated purpose of the business. If that is to generate as much money as possible for the stakeholders then that will be reflected in the culture of the business.

Equally if the stated purpose is, for example, to distribute any profits in such a way as to help solve a social problem then the perceived culture will reflect that decision.

That sense of purpose must be at the forefront of everything we do, of how we relate to our people and the world at large, of the values that we espouse and the way that we project ourselves in general.

Question: Does your business have a stated purpose and, if so, are you proud of it?  More than that, are your people proud of it?

Visit the Vistage UK website
Follow me on LinkedInTwitter and Facebook

Sunday, 20 January 2019

Do New Recruits Bring Baggage? It Can Cause Culture Clash!

In the early days of my tenure as a Vistage peer group chairman, we had as a speaker the CEO of what he called a "London based corporate finance boutique". Despite this description he proved to be a very entertaining and insightful speaker.

His main message was that sale and/or acquisition of businesses is fraught with complications about which we mere mortals know little and having heard the stories from several of my members I can fully understand.

The fact is that buying and selling companies is a highly specialised activity and we, who are more interested in the running of companies, don’t normally come into contact with the issues associated with the sale or purchase of a business.

The speaker made several very important points one of which was that it is inadvisable to deal with just one company in terms of a potential buyer. It is far more sensible to hold a metaphorical beauty parade

This was borne out by one of my members who sold his company and made sure that initially he had at least three interested parties to bid for it. In the end he was very successful.

A further point that the speaker mentioned was that while due diligence by accountants was normal for both parties, it is equally important, perhaps even more so, that the question of a culture match was explored and seriously considered.

In his opinion at least 50% of all acquisitions fail and half% of the balance were not very successful. On that basis he suggested that it was usually a clash of culture between the two parties that was the problem.

This is particularly appropriate when a large corporate is acquiring a small entrepreneurial business that has probably been run very successfully with one individual in charge. In that case a culture clash can be terminal.

In fact it can be so traumatic that in many years I have never experienced anybody selling a business and notionally staying in it to be there for more than about six months. The change in culture is just not to the taste of an entrepreneur.

This is not to say that some acquisitions are not very successful.  Usually this is because there is a good match of cultures between the two businesses and indeed between the two leaders

In the normal run the sale or acquisition of a business is to say the least an unusual event but the recruitment of executives from outside the business is very frequently a normal experience.

Consider the potential issue of bringing in an executive from a large corporate into a small entrepreneurial business or vice versa for that matter.

In both cases the experience and manner of working is manifestly different from the other and unless both sides are willing to compromise there can be real problems.

Ideally each side should consider this new situation to be a learning experience and should be able to adapt their own working to develop a change that ought to be for the better.

I know of one case where a marketing executive was brought in from a large organisation into a smaller one and he quite frankly cause real issues in the business until after a while people realised that he was offering some great insights as they started to use them.

The crux of the matter is that it is all down to the leader. In every case the leader has the responsibility for designing and driving a culture into the business and furthermore to ensure that it isn’t just driven downwards by function but it needs to be across all aspects of the company.

The culture of the business or "the way that we do things around here" is the most important factor in the way in which the business is run. It is the most important function of the leader to drive that concept right throughout the business so that success will follow.

Visit the Vistage UK website
Follow me on LinkedInTwitter and Facebook