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Sunday, 30 January 2011

Can the Number Two Become the Number One? Not Always!

One of the more recurring mantras in business is "never promote your best salesman to be sales manager".  My sales mentor, Phil Copp, the sage of Wythenshawe, was certainly one the best in a sales force of more that 120, and he never aspired to change and take over the top job

He was a typical and very successful operator and knew exactly where his strengths lay.  Fortunately, so did the management so they never even suggested that he move upwards.

During an interesting discussion last week with a very experienced Finance Director, he mentioned that in his past career, he had been promoted to Managing Director of a company and, in pretty short time, he realised that he just wasn't cut out for the job.

Now that is a hard thing to accept and I have the utmost admiration for an executive who knows his strengths and accepts that he actually has certain shortcomings.  Would that more people in business (and certainly politics) could be more forthcoming.

Perhaps that experience suggests that the number two position in a business is not always the best preparation for the top job.  The fact is that most CEOs and MDs arrive in the position by rising through a function, be it finance, sales, operations, manufacturing and so on.

Kenneth and Will Hopper in their wonderful book, The Puritan Gift, (http://www.puritangift.com/) emphasise that domain knowledge is essential for the successful top executive and that can only be achieved by coming up through the ranks of management.

Perhaps an important caveat is the danger of assuming that the number two position is the right preparation for the top job.   Apart from business and industry, in the annals of sport and politics there are so many perfect examples of failures of apparently competent "assistants" to be successful in assuming the leadership and driving their organisation forward.

It may be that too many number twos are so engrossed in the minutiae of their function that they cannot see the big picture; they just don't have the ability to macro-manage as distinct from micro-managing.

It's the helicopter  view of a business that has to be the view of the leader.  Anything less than that means a descent into micro-management and consequent interference with functional executives.

So what is the answer?   That other excellent book, "Good to Great", says that we must "get the right people on the bus" and that implies that succession planning must take note of the ability of managers to take a broad view of the business while, in the initial stages, running their own function effectively.

It's a big and problematical requirement but essential if the organisation is to prosper and grow.  Succession planning demands that making the right decisions in recruitment and, more importantly, spotting the talent in the organisation and then developing it, must be a primary function of the leader.

For further information visit www.vistage.co.uk and www.maa-uk.co.uk
To contact us, email to ivan.goldberg@vistage.co.uk

Sunday, 23 January 2011

Are You a Leader or a Manager? We Need Both!

In and among the multifarious writings and lectures on the subject of leadership we an find just a few different thoughts which stand out.  Once again, Vistage speaker Walt Sutton hits home with a really valuable concept; that there is a big difference between the leader/entrepreneur and the manager.

In essence, Walt defines the entrepreneur as a person who organises, operates and assumes the risk for a business enterprise whereas he defines a manager as a person who controls and manipulates resources and expenditures.

Very neat, and it begs quite a few questions.

If we analyse types of people, admittedly in a very subjective manner, by using the PAEI method, (Producer, Administrator, Entrepreneur, Integrator) then the classic entrepreneur/ leader would rate highly on productivity and entrepreneurship (obviously!), probably less highly as an integrator and almost certainly low on administration, being generally far too committed to doing things rather than organising them efficiently.

On the other hand, the classic manager would rate highly as a producer and administrator, reasonably as an integrator and nowhere as an entrepreneur.

Entrepreneurs are generally perfectly capable of doing managerial functions but they usually do them very inefficiently and often poorly.  It would usually take far more effort for the entrepreneur to do a managerial task than it would a capable manager.

On the other hand, good managers often exhibit entrepreneurial traits but generally only traits.  For some reason it is unusual for a good manager to transform into an entrepreneur and leader.

Equally, the entrepreneur/leader who for some reason aspires to become a great manager is often condemning the business to death.

So what is the answer?  As in so many examples it comes down to compromise.  Every business needs a great leader with strong entrepreneurial attributes and the ability to transmit his/her enthusiasm and passion to the business.

On the other hand, the business needs careful planning, organisation and financial competence which implies the need for efficient and effective managers.

Both functions are vital to the success of an enterprise and this means the ability to work in tandem, understanding the differing needs and roles in each case and adjusting expectations of each other as a consequence.

That takes patience and understanding in most cases but if it can be achieved, then it certainly pays off in the end.

PS: Remember George W Bush's comment that the French don't have a word for entrepreneur?

For further information, visit www.vistage.co.uk and www.maa-uk.co.uk
To contact us, email to ivan.goldberg@vistage.co.uk

Sunday, 16 January 2011

Risk Assessment? Just Go For It!

From time to time a jewel appears in the overall dross of social media and I picked up a quote from one of my "friends" recently (thank you Roxana Chegini!) which went like this:

"Only those who will risk going too far, can possibly find out how far they can go".

That made me think about the all pervading perceived need for constant "risk assessment" in corporate and particularly public sector life.

Risk is a peculiar concept to assess, in that one person's perception of risk can vary wildly from another's.  Considering it coldly, any assessment of risk is essentially negative: don't do that because etc. and constant harping on the element of risk in a project tends to engender a negative approach.

What if we said, for example: "The risk assessment shows that we are in danger of starting a massively successful project"?   Very unlikely, I grant, but it would be a refreshing change from doom, gloom and naysayers.

I am not suggesting that we should ignore any possible risk in a project, but it needs to be in context.   One problem is that the assessment can throw up any and every possible combination of risk which can lead to action being taken to eliminate everything which is a potential danger to the project.

The best way to eliminate risk is not to do anything.  Saying NO makes sure that no mistakes are made even if nothing is achieved.   It is impossible to achieve 100% so the best solution is to decide on what degree of success is acceptable.

Weigh the likelihood of success and failure and if it comes down on the side of success, then go for it, taking a sensible view of what might go awry.

In the end, hustler hustles, and doesn't take much note of the risk, or at least, is prepared to accept that there is risk but still goes for it.  It can be very exciting and for some, too exciting.  The considered and sensible approach works.

"Only those who will risk going too far, can possibly find out how far they can go".

That is what Nigel (in the Archers soap) did, and if he had taken a sensible view of climbing on the roof last week, we might have been spared the long drawn out saga of his demise, but that's show business, I guess.

For more information visit www.vistage.co.uk and www.maa-uk.co.uk
To contact us, email to ivan.goldberg@vistage.co.uk

Sunday, 9 January 2011

Successful or What? Strauss''s Eleven Captains Certainiy Delivered!

Not being one to avoid a passing bandwagon, the success of England's Ashes team in Australia just has to be mentioned today.   It has put a warm glow into many hearts during the freeze up, and decimated the gloomy predictions of the naysayers in the media.

It has been interesting to read now the considered comments of many of the so-called experts in the press, people like Derek Pringle, Michael Vaughan, David Gower and Simon Hughes being excepted as they really do know what they are talking about.

However, some of the comments have been very significant, and while there have been stunning performances on an individual basis, the real difference was in the way that the two teams prepared for the fray.

Leadership is not always visiible.  It is often subtle in its approach and does not need to be brash and visibly assertive at all times.   In many ways, the understated leader is greater by far than the loud and outspoken one because the quiet leader accepts that the team has as much to offer jointly and individually as he/she has and gladly accepts their contribution to the greater good.

One quote that I liked in Saturday's Daily Telegraph was from Derek Pringle who said that "Confidence has built through toil and forensic attention to detail".  How significant is that statement.

It has been noticeable that when interviewed on radio or TV, all the England team members emphasised the hard work that they had put into the preparation.  Fitness of body has been pre-eminent and fitness of mind has been assisted through excellent leadership and great back up coaching.

Belbin Analysis says that there are nine basic types in a team.   Most teams need a Shaper who helps determine the objectives and the style, a Plant who brings in new ideas, an Implementer who puts things into operation and a Completer-Finisher who attends to the detail, apart from other contributor types.

The lessons which business can draw from the manifestly successful team building methods of England's Test team are many.  

Whatever you are doing and whatever the project or process, total dedication to preparation and a relentless attention to detail are essential.  This does not mean that the project needs to be micro-managed by the leader; anything but that.  However, the team needs people who will deliver the detail and the preparation.

Above all, it requires leadership which understands that everyone has a place in the scheme of things and has something to offer.  As Strauss says, he wants eleven captions on the team.  Above all. the need to "get the right people on the bus" with a dedication to the overall objective of success is essential and that must be the primary objective of the leadership.

It is very pleasant and somewhat unusual to be able to draw these comparisons, and learn from an exceptionally successful English sporting team, so let's make the most of it.

For more information visit www.vistage.co.uk and www.maa-uk.co.uk
To contact us, email to ivan.goldberg@vistage.co.uk

Monday, 3 January 2011

One Size Fits All? Not Always, It Doesn't!

Good to be back after the extended Christmas holiday.  Now is that time of the year when the newspapers review the past year (as well as making relentlessly gloomy predictions for the coming year) and the consensus seems to be that the turmoil in the Euro was the defining event of 2010.

Starting with Greece and followed by Ireland with Portugal and Spain on the edge, generated a great deal of discussion as to whether this marks the end of the Euro, the end of the Eurozone as currently structured, and even the end of the European Union.

This is not intended to be either political or economic comment, rather a look as to the reasons for the strange imbalance in the way that countries run, and it all comes down to the inherent national culture.

Is it coincidence that the problems have largely centred in the Southern Europe/Mediterranean countries while the Northern European countries, while still having their problems, seem to be taking the right actions to correct the situation?

Cultures in all these countries vary massively.  Without going into detail, attitudes in Germany and Holland, for instance, are not the same as those in Italy or Greece, implying that the "one size fits all" approach doesn't always apply on a macro scale

So what does that mean on a micro, or company basis?   Again, each individual company has its own culture, either formally or by default.  There are very few reasons to applaud top down management but in this case it is essential.  Unless the culture of a company is clearly defined, frequently articulated and driven from the top down, the default mode takes over.  It is one of the main functions of management to make certain that the culture is appropriate to the purpose of the business.

Vistage speaker, Walt Sutton, says that one of the nine primary functions of the leader in a business is to "build a society and define the seasons".  He explains this as making sure that you have the right people "on the bus" and defining how all the people should want to behave, in other words, within the culture of the business.

That having been said, each individual company has its own culture and each is probably different from the next company.  Ideally it is good to deal with customers and suppliers who have largely the attitudes and general approach and this can happen through an osmotic process.

The problems can arise in a merger (a synonym for acquisition) situation.  Again the "one size fits all" is more often than not a triumph of hope over realism.  another Vistage speaker, Barrie Pearson, who ran what he called a corporate finance boutique, said that "50% of all acquisitions fail and half of the rest are not successful".  Why?  Because insufficient thought has been devoted to the variables in the cultures in the two businesses.

One of my members told me that when he considers an acquisition, the due diligence process, as well as covering the obvious functions such as finance, operations and sales, makes a specific objective to define the culture of the business and to assess its possible effect on the joint company.

The counter argument to all this?   Take a look at one of the brilliant RSA Animation series on YouTube called "The Empathic Civilisation".   Because of the extraordinary growth in social media it suggests that individual national and lesser cultures will be subordinated to a sort of benign mob rule, with initiatives starting and developing outside formal channels.  Perhaps this is already happening to some extent and it may well grow exponentially like its carrier.  Please note, Facebook has just been valued at $50bn which is substantially greater than the GDP of many a country.

Whatever happens in the future, businesses still need to consider their own culture and make certain that it doesn't just happen by default.  Define the seasons and make sure that you build a society that will take you and the company forward.

I wish you all a very happy, joyful, peaceful, healthy and successful New Year.

For further information visit www.vistage.co.uk and www.maa-uk.co.uk
For further information, email to ivan.goldberg@vistage.co.uk