Blog Archives

Change Leadership: Many Start but Few Finish Well

Organizational Change Management Strategies

Planning and Execution of Change

Most organizations have a leadership deficit because they ignore leadership potential and do not offer training or relevant role models.

When time is restrained and rewards are high, the most effective leaders count on their ranks to do what they do best. These leaders galvanize people to use their proficiency to solve problems and achieve goals.

Great leaders get others to move in a direction that is sensible for themselves, the business, and community. Today, we need more leaders who can help groups come up with visions that are not self-serving—visions that serve the entire enterprise.

Historically, great leaders are self-confident people who have extraordinary capacity to make decisions when others crumble. They are confident, but not arrogant. In fact, great leaders are often described as having humility and vulnerability. I am often struck by the extraordinary arrogance of some leaders—an arrogance that says, “I’m above the game. I am smart and accomplished. Therefore, I know what is best, yet I have to put up with stupid rules set by small-minded people. It’s only natural that I maneuver around those rules.” You do not find that same arrogance in great leaders.

For change to be good, it has to be in a positive direction. Initial stages of transformation are usually positive, but the change effort is perverted as it becomes successful and as executives become more arrogant. Change is not the issue; arrogance is. As some leaders start running into problems, in their arrogance they say, “No problem. We can handle all this. We can cut corners and make our own rules.”

Companies need to be able to exercise sound leadership when responding to a crisis. But what if you didn’t need to be eager to execute this style of strategic leadership?

'Organization Change Theory and Practice' by Warner Burke (ISBN 1506357997) In organizations with a strong brand, if you do not have senior leaders who are humble and vigilant, you develop an arrogant culture. The single biggest challenge in managing change is not strategy, structure, or culture, but just getting people to change their behavior. One reason why that is so challenging is that we rely on giving logical reasons for change but fail to present people an emotionally compelling case. People change their behavior only when they are motivated to do so, and that happens when you speak to their feelings.

You need something visual that produces the emotions that motivate people to move toward the vision. Great leaders tell stories that create pictures in our minds and have emotional impact. Martin Luther King Jr. had a dream, not a strategy or goal, and he shoved us his dream, his picture of the future. People change when they see something visual (the vision) that touches their feelings, challenges their thinking, and incites actions. People may realize the need for change, but not do anything differently because they lack the passion to break out of routines or habit patterns. The momentum of “how we’ve done things” tends to make our future look like our past.

Principles and Theories of Organizational Change

Overcoming complacency—so vital at the start of change initiatives—often requires a bit of surprise, something that grabs attention at an emotional and intellectual level. You need to surprise people and disrupt their view that everything is perfect. Successful change leaders show people what the problems are and how to resolve the problems. They use images that people can see, hear, or touch. This may mean showing a video of an angry customer rather than a report of a customer survey. Change leaders make their points in ways that are emotionally engaging and compelling. They tell and retell vivid stories. You do not have to spend a million dollars and six months to prepare for a change effort. You do have to touch people emotionally.

The ability to move people emotionally is a special gift. Few of us are born with it, but we can learn it. In writing The Heart of Change, we found many people who had learned this skill. Some did not look like leaders, but somewhere along the way, they learned to speak to people’s feelings. One story involves people who realized that they had to start changing their own behavior. Many managers skip this part and start with, “Here’s how you need to change” because it is easier to tell other people that they are acting incorrectly than to admit that you are not perfect. Executives, as they become more successful, get less feedback or information showing how they are a part of the problem. Many of them have never learned the principle, always start with yourself first—and then go from there. It is a great rule of thumb.

Personal example is a powerful method of influence that can affect feelings and facilitate change. However, when leaders do not examine their own actions, they might give the wrong example, something that is inconsistent with what they are saying to people. People pay attention to deeds more than words.

All of us, deep in our hearts, want to be heroes, at least to our children or team members. Today we need heroes at every level. More people need to step up and provide change leadership. Most of this leadership will be modest. It might be a young sales rep who sees a new business opportunity or puts together a vivid demonstration of a problem. The sum of all these heroic actions—large and small—enables organizations to change in big ways.

Change Leadership: Many Start but Few Finish Well

Organizational Change Management Strategies

People need more positive examples of what works. In stories of what works, I never find a theme of self-preservation. Change leaders are not self-centered people. When focused only on yourself, you will not stick your neck out, lead the team to new glory, or create a shared win. You need a larger vision beyond saving your own skin. Several change proposals seem to presume that people will begin to shift their behaviors once formal elements like commands and encouragements get underway. People who work together on cross-functional teams will commence cooperating because the lines on the chart show they are intended to do so. Managers will become clear communicators because they have a mandate to deliver a message about the new strategy.

If you are frustrated and powerful, you tend to fall back on fear to motivate people. You say, “I know the right thing to do here, and you’ll either do it or be fired.” While using fear may be natural, it is usually ineffective. The only lesson your people learn is that you have power, and they need to fear being fired. They learn nothing about the enterprise, its challenges, and the need to do things differently. Fearful people do not listen carefully to customers. They hide or come up with schemes to protect themselves. Fear cannot drive transformation. However, fear may be used effectively as a surprise element. It is the “hit them upside the head with a board” approach to get attention. Then you have to quickly convert it into something positive or you get the drawbacks of fear.

Even if people are motivated to change, they are often blocked by a feeling or belief that they cannot change. Pessimism creates an emotional block to change. Effective change leaders use inspirational stories to bring out the natural optimism in everybody. They know how to inspire confidence, even in tough circumstances where people are depressed. They paint a hopeful picture in such a credible way that it soothes people and lead them to get out of the trenches to do something.

Managing Organizational Change

The change has to seep into the culture. The new behavior must maintain itself for a few weeks and show that it works. Then, the culture must support the change. For the new way of doing things to take hold, one change agent or leader cannot support it all. People need to see the right behavior producing the right results. Too often leaders assume that once they start the change effort, they are done. They must make it part of the culture; otherwise, when they leave, the old way creeps back in.

'Change Leader Learning to Do What Matters Most' by Michael Fullan (ISBN 0470582138) How can people stay focused long enough to create short-term wins and change the culture? This is where vision helps. If you have clarity in your mind and heartfelt commitment to a vision, you stay focused. Again, the vision has to be something you can see clearly—not some blur or list of unrelated items. So many strategies and statements of values, visions, and goals boil down to lists of unrelated items, making it hard to stay focused. Your focus bounces from one item to another because you lack a framework to guide you. You might let something else that is not on the list blow over you and push you in another direction.

You might carefully select two areas where you can achieve short-term successes and have one team focus on one item and another team focus on the other. People need to see that the changes are not oddball ideas being pushed by the boss. They need to see short-term wins that validate the change vision. If the win is clear, visible, and valuable to people, then they will likely make change happen.

To use this emotive energy, leaders must look for the constituents of the culture that are affiliated to the change, bring them to the foreground, and fascinate the attention of the people who will be affected by the change.

Communicating strategic intent empowers leaders to determine direction and noticeably defined goals. Leaders renounce from nit-picking the specific execution of the intent, but still hold their team members or subordinates answerable for change management.

Tagged
Posted in Management and Leadership

The Romantic Rome at Nighttime

The Romantic Rome at Nighttime

During the day, Rome is a very busy modern city of two and a half million people and people are going about their business—they are crowding onto the buses, they are trying to hail a taxi, there speeding like heck through traffic—and it really can be very exhausting.

When the sun goes down, the entire character changes and it’s not just for tourists but for the people there and this is what they live for in Rome. To be able to come out and socialize and everything becomes more relaxed and people’s attitude changes. For them, the and evening is not “I’m going to rush here to this concert” and “I’m going to rush there to get dinner” and “I’m going to grab something to go” the way many Americans would do—instead it’s settling down into this easy rhythm of life and seeing what’s going to happen next.

Think about to the traditional Roman siesta. People will take their large meal in the afternoon and maybe even sit down and take a little nap or watch a little TV for 20 minutes or something—all in order to recharge their batteries so that they can come out at night and that’s when they really live and that’s what tourist should also do. Take a little break from your sightseeing in the heat of the mid-afternoon, take your little siesta, and gear up for the wonder of Roman nighttime.

Archaeologist Rome Romantic Rome by Night

Archaeologist’s Rome by Day and the Romantic Rome by Night

Get ready for the transformation of Roman grandiosity to Italian intimacy. What makes an intimate Rome easier is the way the city is lit at night. It was a deliberate choice on the part of the city administration not to have this neon glare that sort of flattens everything and makes everything look the same, but to have these very soft orange lights that are supposed to imitate the light of a torches in the past. So when you stroll through the city at night you can’t see everything together from afar. You have to discover it closely as you get to it. All this affords a gradual intimate look that you’ll really love and also makes you imagine the city in the evening.

There is an interesting distinction—there’s the grand Rome and then there’s the intimate Rome. By day it really is the grand Rome with icons such as the great Roman monuments, the Coliseum, and Pantheon. But really that the night-time Rome is the small, medieval lanes the people walk through. By day it’s the archaeologist’s Rome and by night is the romantic Rome.

The Aperitivo Culture - Romantic Rome at Nighttime

The Aperitivo Culture

Even if you’re not a type of person that likes a cocktail before dinner, have a drink on a piece of expensive real estate, enjoy the little munchies surrounded by local people doing exactly that. If you’re in the mood to splurge, join in a rooftop bar at a hotel downtown, or just have an aperitivo on one of the squares. Then have dinner, skip dessert, take an after-dinner stroll with gelato.

A wonderful Roman night is all about the pace of things. Romans don’t try to fit in like dinner and a show … it just kind of dinner. You linger over each course because the meal becomes the evening’s entertainment itself and the Romans love to dress up to go out to meet their friends, sit at a little cafe or restaurant with rickety tables and traffic roaring past them. It’s that little slice of intimacy where they can then get into that pace of life and that rhythm of life where each course becomes a new magical thing. Don’t be a traveler who wants to keep it moving.

Charming Medieval Roman Neighborhood Trastevere

Trastevere—a Charming Medieval Roman Neighborhood with an Intense Character

You got that that local pride; there was a time when they would never cross the river on the other side of the Tiber River. In fact, literally Trastevere means “the other side of the river”—the district’s name derives from the Latin words “Trans Tiberim” beyond the Tiber River.

This is that other side of Rome—the intimate side of Rome—the Rome of the narrow lanes of the red pastel colors, buildings with green ivy hanging down with the people’s laundry hanging overhead, lanes pop into tiny little squares that feature little cafes, restaurants, pizzerias where you can sit down and enjoy your meal. The food is great, the aperitifs are great, but it really is presenting you the theater of the people. Don’t let that pass by. Hang out in these squares and you’re paying your cover charge for a great celebration of life.

Nighttime Romantic Walks - Romantic Rome at Nighttime

Nighttime Romantic Walks in Roman

For a great walk, start from St Peter’s Square because in the evening is lit up splendidly and I would just walk towards the river where the Castel Sant’Angelo, a Fortress where the Popes used to escape to in the past. It’s also a little beautifully lit monument cross the river Tiber, where you can cross the bridge of the Angels which is decorated with his beautiful Bernini statues. Walk along the Via dei Coronari and it does give us that back street village that is very romantic and end up at the beautiful square Piazza Navona.

Castel Sant’Angelo was originally a tomb for Emperor Hadrian. That was the original structure and then it took on other uses as time went on and in the medieval times because it was so tall and so monumental, it was used as a castle and as a prison. This tomb for Emperor Hadrian is across from the river Tiber because Ancient Roman laws established that the dead had to be buried outside the city.

it’s a wonderful place to go up at sunset. A great way to kick off your evening you go up there and you look across and you have this incredible view of Michelangelo’s Dome and all of the other domes of the city. You watch the sun turn orange and you watch the pigeons as they start flying by and this is where you begin to see night descend on the Eternal City.

What’s great about Rome at night is that on the one hand you’re walking down a little alley way or a little narrow street and then torch lit or seemingly torch lit with this new lighting and on all of a sudden you pop out and there’s a floodlit monument … there’s the pantheon … and all that then surprise element and you’re getting that mix of this very romantic and dark that this then punctuated with a blaze of light and glory from ancient monument and you can have a kind of a quiet street and suddenly you step into a floodlit square with three grand fountains and artists and street musicians and outdoor cafes in the evening.

Via del Corso Spanish Steps - Romantic Rome at Nighttime

Via del Corso, the Fountains, and the Spanish Steps in Rome

The main drag, the Via del Corso is shutdown, with police on horses monitoring the activities. It says a lot about the way in which an urban setting can be experienced … the Romans hate crowds as much as anybody else but they also don’t like deserted places. The passeggiata can feel that you’re part of a community … part of something bigger than just yourself.

Go to the Spanish Steps because that’s where all of Rome will be descending for nightfall and you will see the things that are typical of Rome at night. Witness the flood lights, see Bernini’s fountain down at the base, with people sitting on the on the steps, and if you wanted to you could climb up to the top where you can get a great view out over all of Rome so you can really feel like you are in one place but you’re taking part of the entire city.

Fall in Love with Nighttime Rome

During the day it can be an overwhelming city by day where everyone’s in a hurry and traffic generally competes with some of the greatest city views anywhere, but after dark that’s when Rome becomes a true spectacle.

Tagged
Posted in Music, Arts, and Culture Travels and Journeys

Characteristics of Transformational and Emergent Leadership

What Constitutes Transformational Leadership

'The Difference When Good Enough Isn't Enough' by Subir Chowdhury (ISBN 0451496213) Transformational leaders are those who bring order to guiding change. They must not only convey a compelling vision and be sensitive and responsive to the needs of their constituents but also behave as role models who walk the talk. These leaders typically are officially designated and have the formal position, authority, and backing. They drive change, establish the vision, and mobilize the troops.

  • Cause / create change
  • Freeze, unfreeze, refreeze
  • Create order from chaos
  • Role model—“walk the talk”
  • Create something different by changing the one
  • Broad issues (visions, paradigms)
  • Space for either/or
  • Transcend and include; refocus
  • Drive change

What Constitutes Emergent Leadership

'Personal Leadership' by Barbara Schaetti (ISBN 0979716705) Emergent leaders, on the other hand, may not be officially sanctioned and are more on the chaos side. They may, in fact, be part of what Ralph Stacy terms the shadow organization—interactions among members of a legitimate system that fall outside that legitimate system. As people operate in the shadow system, leadership roles emerge. The roles then shift based on contributions people make and how they make that contribution known.

  • Navigate in a context of change
  • Go with the flow
  • Live between order and chaos
  • Partner—“walk the talk”
  • Create something different by combining the many
  • Human / existential issues
  • Space for both / and
  • Transcend and include; embrace
  • Allow change to unfold (facilitate / nurture)
Tagged
Posted in Management and Leadership

Top Performance from the Bottom Up

Top Performance from the Bottom Up

We can best help people improve performance not by trying to solve their problems for them but by helping them learn to solve their own problems.

We can’t approach performance improvement from a reactive and fragmented stance. Rather than reacting to each isolated performance problem, the key is making performance improvement integral to the way people manage their work. After all, steering clear of problems, identifying problems early, and resolving them so they do not occur again is what managing work is about. All people are responsible for managing their own work; some are responsible for managing work within a team or a function, others for managing across functions, and still others for managing entire firms.

Managing work consists of three components:

  1. setting goals;
  2. letting work happen and comparing work completed against goals; and
  3. deciding whether to change how the goals are being pursued.

When these things are done well, individuals and organizations almost always meet goals. But, these three things are rarely done well. Few managers consistently prevent costly performance problems or ensure that goals are achieved.

'The Performance Pipeline' by Stephen Drotter (ISBN 0470877286) Performance consulting is simply coaching people on setting goals, letting the work happen, comparing results to the goals, and then deciding how to proceed. Most emergencies are simply breakdowns in one or more of these three areas of management. The solution to performance problems is always to help the person, team, or organization manage itself more effectively.

When people learn new behaviors, not only will they resolve the current emergency, but they will know how to address or avoid the next emergency.

Think of these levels of managing work as layers of an onion.

  • The outer layer is like the upper tier where organizational goals are set and monitored. These goals involve overall direction and objectives, and decisions are large in scope.
  • Below that layer is the cross-functional (or process and project) layer. Goals at this layer cover a smaller scope but must align with organizational goals. They include things such as what products and services will be available when, and which internal processes currently need the most attention. Goals are reviewed and revised a little more frequently than at the higher layer.
  • A third layer is where individual and group goals are set and monitored. The same basic practices for helping individuals manage 1heir work apply to helping executives manage their work. Since the magnitude of distractions and decisions are much greater at the executive level, practice this approach at the lower levels.

Self-Sustaining Performance

'Fearless Leadership' by Carey Lohrenz (ISBN 1626341133) The desired end result is a selfsustaining performance system (SPS) a systemic approach that provides an immediate solution while leveraging the performance perspective for sustainable long-term success. The SPS always assumes that the performers are missing one or more of the three conditions that guarantee successful performance. Those conditions are:

  • Clear performance expectations: Each performer must know exactly what he or she is expected to do and how well, and must commit to it.
  • Frequent, self-monitored feedback: Each performer must know, at any given point, whether he or she is meeting performance expectations.
  • Control of resources: Each performer must know that, if he or she provides warning that performance is not meeting expectations, management will either help the performer succeed or change the expectation.

The three conditions summarize all the factors that affect performance in the order they should be addressed. When all three conditions are in place, we have a performance system. When most members are operating in an effective performance system most of the time, we have a SPS.

Just implementing the first two conditions usually results in productivity increases of 30 percent or more within a very short time.

The third condition, control of resources, ensures that productivity increases can be sustained. It also ensures that manager and performers have a stake in whatever performance improvements are implemented. Whether the need is for better tools or better organization, they are more likely to turn the required change into improved performance. And because they have frequent self-monitored feedback, they will be the first to know if their performance is improving.

By implementing a SPS, you help people steer clear of most problems, immediately identify problems when they do arise, and resolve those problems so that they do not reoccur.

A successful SPS means performers are consistently successful and raise the bar on their own performance. Instead of waiting for performance to get worse, they prevent problems and coordinate work effectively.

Contributing to systemic improvement as opposed to everyone tweaking their isolated functions, must be the expectation for every member.

Tagged
Posted in Management and Leadership

Diversify Your Business Risk through Shared Risk and Reward Programs

Diversify Your Business Risk through Shared Risk and Reward Programs Risk assessment is a principal tool used to make current environmental decisions, but it is still crude, expensive, and controversial.

While diversification is indispensable to managing financial investment risk, business leaders need to prevaricate their bets and manage their financial vulnerabilities.

Risk taking is the part of business strategy that involves assessing how a business’s decisions will damage or benefit the company. Every business encounters risks, which may or may not be anticipated or controlled by the company.

This does not mean you attempt into markets or embrace technologies you don’t understand, but instead that you look at what you are already doing and categorize natural market synergies and product line extensions. In addition, it is best to be ahead of the curve on market trends and changes rather than lagging behind them.

Leaders Comprehend the Value of Shared Risk and Reward Programs

'Enterprise Risk Management' by James Lam (ISBN 111841361X) There is no seamless diversification strategy. It is more of an art than a science. The significant thing is to protect your margins and stabilize your cash flow while growing your top line. For example, you may have some parts of the business that are in a fast growth mode and eating cash. In this case, it would be helpful to have other areas of the business that are growing more incrementally, generating surplus cash flow and steady margins.

Risk assessment is a form of analysis of the probability and magnitude of harm from various events and activities. Related to the science of risk assessment, risk management determines how to plan for and communicate about risks. Risk perception is a science devoted to examining the qualitative aspects of risk, not simply its quantitative aspects.

To bring together the various disciplines and implement integrated risk management, ensuring the buy-in of top-level executives is vital. These executives can institute the processes that enable people and resources across the company to participate in identifying and assessing risks, and tracking the actions taken to mitigate or eliminate those risks.

'The Essentials of Risk Management' by Michel Crouhy (ISBN 0071818510) You may also have become too reliant upon one client and need to have a marketing strategy that pushes you to identify multiple new prospects that have the potential to grow with you in the same way. You may entered one market as much as you can and need to expand to other geographies. Never rest on your marketing laurels or get too self-satisfied. Companies needed to take advantage of regional management contracts.

I realize that business size does come into play here. However, regardless of how big you are, do not become a “one trick pony.” Anticipate that your business will have up and down periods and then think of imaginative ways to smooth out this curve. All good leaders understand and embrace the importance of diversification. To the maximum degree possible, put your fate in your own hands instead of being subject to whims of the marketplace.

Tagged
Posted in Business and Strategy

Peter Cundill Quotes from ‘There’s Always Something to Do’

Peter Cundill Quotes from 'There's Always Something to Do'

F. Peter Cundill (1938–2011) was a Canadian value investor of the Benjamin Graham investment school. He was most well known for his flagship investment fund, Cundill Value Fund. His The Mac Cundill Value Fund Series A has returned 10.1% per annum during 1993 until 2003, compared with 8.1% for the benchmark Citigroup World Equity index, according to Morningstar.

  • On Forecasting: “I think that intelligent forecasting (company revenues, earnings, etc.) should not seek to predict what will in fact happen in the future. Its purpose ought to be to illuminate the road, to point out obstacles and potential pitfalls and so assist management to tailor events and to bend them in a desired direction. Forecasting should be used as a device to put both problems and opportunities into perspective. It is a management tool, but it can never be a substitute for strategy, nor should it ever be used as the primary basis for portfolio investment decisions.”
  • On Skepticism: “Scepticism is good, but be a sceptic, not an iconoclast. Have rigour and flexibility, which might be considered an oxymoron but is exactly what I meant when I quoted Peter Robertson’s dictum ‘always change a winning game.’ An investment framework ought to include a liberal dose of scepticism both in terms of markets and of company accounts. Taking this a step further, a lot of MBA programs, particularly these days, teach you about market efficiency and accounting rules, but this is not a perfect world and there will always be anomalies and there is always “wriggle room” within company accounts so you have to stick to your guns and forget the hype.”
  • On Patience for Investors and Selling Too Early: “This is a recurring problem for most value investors—that tendency to buy and to sell too early. The virtues of patience are severely tested and you get to thinking it’s never going to work and then finally your ship comes home and you’re so relieved that you sell before it’s time. What we ought to do is go off to Bali or some such place and sit in the sun to avoid the temptation to sell too early.”
  • 'There is Always Something to Do' by Peter Cundill (ISBN 0773535373) On Statistical Overvaluation: “I almost stopped selling Japan short in the last quarter of 1989 because I couldn’t stand it anymore. But intellectually I was convinced that I was right and so I carried on and then in the first quarter of 1990 the Japanese market fell by 25% in eight weeks and I made back everything I’d given away since 1987 plus a good deal more. But I tell you statistical overvaluation is a funny thing—it can go on for a very long time, far beyond the limits of rationality, and it is a problem for the value investor in two ways: it can tempt one to compromise standards on the buy side and it may lure one into selling things far too early. I have less of a problem with the selling temptation because I have always loved cash—if you’ve got lots of it you will never have to pass up a great opportunity.”
  • On Curiosity: “Curiosity is the engine of civilization. If I were to elaborate it would be to say read, read, read, and don’t forget to talk to people, really talk, listening with attention and having conversations, on whatever topic, that are an exchange of thoughts. Keep the reading broad, beyond just the professional. This helps to develop one’s sense of perspective in all matters.”
  • On Patience: “For all my emphasis on the virtues of patience in value investment it has to go hand in hand with minute attention to the detail, with conviction and determination, otherwise patience is just futile endurance.”
  • On Intellectual Distractions for Investors: “Just as many smart people fail in the investment business as stupid ones. Intellectually active people are particularly attracted to elegant concepts, which can have the effect of distracting them from the simpler, more fundamental, truths.”

On the Worst Investment He Ever Made

The worst investment we have ever had was Cable & Wireless, which had built up a large cash pile through the sale of telephone companies in Hong Kong and Australia and their mobile telephone business in the UK. They were well negotiated, judicious sales. What they had left was a stand-alone operation in the Caribbean, which still exists, and they were in the fibre optic business that was blowing cash. So we said, look they’ve got cash, they’ve got a valuable, viable business and let’s assume the fibre optic business is worth zero—it wasn’t, it was worth less than zero, much, much less! Their accounting was flawed to say the least and they became obsessed by a technological dream. In this respect it was reminiscent of Nortel and that should have caused me to think twice.

I talked to John Templeton about it afterwards and he took a worse hit than us. He said “this is why we diversify, if you are right 60% of the time and wrong 40% you’re always going to be a hero, if you are right 40% of the time and wrong 60% you will be a bum.” I think he probably put it more elegantly than that! But there’s one more thing. We had put a huge amount of time and energy into that one and we were willing it to save itself and, on the face of it, it could have. What we needed was a dissenter in the team—a contrarian among contrarians, a lateral thinker watching out for the left field. On that occasion there wasn’t one. So my thought is, if there’s no natural sceptic on an investment maybe it would be wise to appoint one of the team to play Devil’s Advocate anyway.

'Routines and Orgies- The Life of Peter Cundill' by Christopher Risso-Gill (ISBN 0773544720) Peter Cundill was the founder of Cundill Investment Research and was named Canada’s fund manager of the year at the Canadian Investment Awards gala held in early December 2004. Born in Montreal and based in London, Cundill spent much of the year scouring the globe in search of value opportunities for Mackenzie Financial‘s Cundill fund family.

On Investors’ Biggest Challenges

The ultimate skill in this business is in knowing when to make the judgement call to let profits run. While it is true that 99% of investment effort is routine, unspectacular enquiry, checking and double checking, laboriously building up a web of information with single threads until it constitutes a complete tableau, just occasionally a flash of inspiration may be necessary. Once we have begun to build a position it has to be recognized that our intentions may change in the course of its construction. An influential, or even controlling, position quite often results from a situation where a cheap security does little or nothing price-wise for such a long time that we are able to buy a significant percentage of the equity. Whether our intentions remain passive under these circumstances depends on an assessment of the outlook for the company and the capability of its management, but I don’t think that we ought to be pro-active merely for the sake of it. My task is principally the identification of opportunity and the decision to press the buy button. This may sometimes turn out to be a catalyst in itself, but normally we should rely on others to do the promotional work or to put the company directly into play. Otherwise it will turn into a constant and time-consuming distraction from our prime objective of finding cheap securities to buy.

Tagged
Posted in Investing and Finance

How Corporate Executive Education Programs Could Collaborate with Universities

How Corporate Executive Education Programs Could Collaborate with Universities

Executive education programs are comprehensive and wide-ranging. Everything from off-the-shelf programs focused on significant business challenges to made-to-order programs. Great faculty-people who can stimulate and invigorate executives-teach these programs. Executives go back to their firms with great recollections and ideas. They feel cherished by their company because the company has invested in them. Hurrah!

How can lessons from these involvements be applied to enhance business results? The answer lies in cultivating the relationship between the corporation and the university.

Curriculum design in Corporate Executive Education Programs The first step is to tailor the executive education program with the university. To do this, the firm must have specific goals that the core curriculum can address. These goals could aim at specific business problems or performance. Class makeup is important in any made-to-order course designed for impact. Attendees must be responsible for that impact.

The firm will need an executive sponsor who can enunciate the goals and contribute to the curriculum architecture. Inherent in this design is the post-program application. Useful goals are measurable. Measure their state of achievement before and after the course to understand impact. When the core curriculum is designed around these goals, attendees then can be expected to conclude the program with a plan to apply the lessons. If at all possible, the executive sponsor should hear those plans and follow their progress.

Curriculum design must integrate scalable learning. If the lessons learned during the course are to generate operational results, those who attended the course must teach them to those who did not attend. This can be a challenge given time and location constraints. Scalability often necessitates innovative solutions such as interactive e-learning sessions where employees anywhere, anytime can partake in online sessions that deliver the key message to implement. Future programs for smaller teams targeting a specific problem can be launched through virtual white-board sessions with faculty. CDs also provide a useful medium to capture and share key sessions. Workbooks can be used to scale the plans.

Corporate Executive Education Programs partnership between a corporation and a university Our universities include impressive thought leaders who spend their careers studying business challenges, pursuing solutions across industries. This talent can do far more than share their insights. If properly reinforced, they can channel their classroom work towards corporation-specific goals. This support includes pre-program preparation. Meeting with the faculty and educating them on the firm’s business and the goals is vital. Investor relations’ performances and annual reports are useful tools for this meeting. They cannot customize their teaching if they do not understand the business and the issues. Depending on the content necessitated, a non-disclosure agreement may be needed.

Faculty must also understand the attendees and their roles in the goal achievement. Once the faculty understands who does-what-where, they can effectively tailor discussions for individual and group needs. Knowledgeable faculty can also participate in study group discussions beyond the classroom and help create solutions. Also, sharing the attendees’ biographies or leadership profiles can give the faculty an understanding of their partners in this impact-focused learning journey.

The elements of a working partnership between a corporation and a university are the same ones we use for any partnership. Both parties must have an open working relationship with identified, measurable goals. Clear communication is imperative. Both parties must be focused on results and know the talent they have to achieve those results. Scalable solutions are indispensable. We approach business this way every day. Developing our key talent deserves nothing less in commitment or rigor.

Tagged
Posted in Business and Strategy

Forward-Thinking HR Management

Forward-Thinking HR Management

Times are tough. Companies are cutting jobs. But leaders must climb out of the pity party and look up take a turn for the better. The sun is gleaming! There are brighter days ahead. Leaders must look toward the future. Those who get caught up in short-term thinking make short-sighted decisions that only impede revival.

Who will attract the best talent? Companies led by forward-thinking leaders who understand trends, plan ahead, and inspire others. So, it’s high time leaders start discerning, acting, and talking like progressive futurists with an exciting future. Few companies have the quality or depth of leadership they need to win the competition for top talent.

As the economy heats up, many people will change jobs. Recruiters will target your most competent and productive people. When those people leave, it will be hard to replace them with people of the same capacity. When your cream people leave, so will customers. If your customers leave, your cash flow will tumble.

This situation is in your control as a leader. If you exercise strong leadership now, you can avert the Death Spiral from killing your company.

Bewildered leaders, now is the time to exercise super leadership:

  • Place more emphasis on your relationship with human resources-the department and the people. The Chief Human Resource Officer should hold the same status as the Chief Financial Officer. With the CEO, the CFO and CHRO should form a dominant triangle of inspiration.
  • Get out of your office. Today people want to see their leaders in person. So, lead by wandering around. Get out with your people. Listen to their challenges and concerns. Inform and inspire them. Get them involved in your future plans. People support what they help to create. Talk genuinely with your people.
  • Engage in serious strategic staffing. What will your HR needs be over the next few years-to meet the goals set by strategic your executive plan must team? Be in Your alignment recruitment with your corporate strategic plan. What kinds of people will you need to hire, and how will you do that? What additional training and experience will be needed by the people you have now, and how will those needs be fulfilled? Will you have the talent you need a few years from now?
  • Clean house. Clean out the people who don’t fit. You’ll be doing them a favor. Look for “fit” in terms of productivity, values, inclination to the job and your mission, and how they mesh with your culture. If you don’t have congruence now, you’ll have more problems later. If you have managers whose behavior or values are not consistent with the company’s future, invite them to make a career change.
  • Become more selective. The Age of the Wann Body is over. Every person employed should meet your standards. This means developing standards of ethics, attitudes, skills, and performance that everyone must adhere to. Get your people included in the process.
  • Build emotional bonds. Take a leadership role in orienting new people. Meet them, let them meet you, share your philosophy and values. Arrange for current employees to experience your employee orientation. Many of them are not tuned in to what you’re all about today, so you don’t have the cohesiveness you need.
  • Invest in leadership development at every level. Front-line supervisors need training in how to best work with their people to produce superior results. Leadership skills have an effect.

This decade will be a challenge. It’s test time. Are you prepared? Are you equipped for the challenge?

Tagged
Posted in Management and Leadership

Stimulus Events That Can Trigger Employee Disengagement

Stimulus Events That Can Trigger Employee Disengagement

Employee disengagement has huge expenses for individuals and organizations. Employee engagement is indispensable to the health, well-being, and success of organizations and individuals as the work environment becomes leaner, more information-driven, and extremely competitive.

Employee engagement endures to capture the interest of practitioners and scholars, yet estimations are that between 50%and 70% of workers are not engaged. Disengagement has insinuations for profitability, productivity, safety, mental health, turnover, and employee theft.

'The 7 Hidden Reasons Employees Leave' by Leigh Branham (ISBN 0814408516) Though there may be multiple symptoms behind low employee engagement levels, one common culprit is a failure of companies to diagnose that the way people work is developing. From Leigh Branham’s The 7 Hidden Reasons Employees Leave:

  • Being passed over for promotion
  • Realizing the job is not as promised
  • Learning they may be transferred
  • Hiring boss being replaced by new boss they don’t like
  • Being assigned to new territory
  • Being asked to do something unethical
  • Learning the company is doing something unethical
  • Sudden wealth or sufficient savings to buy independence
  • Earning enough money (grubstake)
  • An incident of sexual harassment
  • An incident of racial discrimination
  • Learning the company is up for sale
  • Learning the company has been sold
  • Realizing they are underpaid compared to others doing the same job
  • Realizing they are not in line for promotion for which they thought they were in line
  • Realizing that their own behavior has become unacceptable
  • An unexpected outside job offer
  • Being pressured to make an unreasonable family or personal sacrifice
  • Being asked to perform a menial duty (e.g., run a personal errand for the boss)
  • Petty and unreasonable enforcement of authority
  • Being denied a request for family leave
  • Being denied a request for transfer
  • A close colleague quitting or being fired
  • A disagreement with the boss
  • A conflict with a coworker
  • An unexpectedly low performance rating
  • A surprisingly low pay increase or no pay increase

The costs of disengagement have not been calculated, though some statistics might begin to suggest on important economic reasons to address this silent majority. What makes it exceptional is the high level of employee engagement exhibited by its high performing workforce; the result of true enterprise-wide transparency and trustworthiness that is supported and promoted by all employees and people managers.

Disgruntled customers have a big impact on a business’s bottom line, which brings us to the most important reason employee engagement should be top of mind for executives.

Tagged
Posted in Management and Leadership

Tesla’s Elon Musk is a Snarky CEO

Books Recommended by Elon Musk

On the 02-May-2018 quarterly results call, Elon Musk, CEO of Tesla, snubbed Wall Street analyst who called his performance “bizarre.”

When Toni Sacconaghi, a senior sell-side equity research analyst at Sanford C. Bernstein, asked about the company’s capital expenditures, Musk responded, “Excuse me, next. Next. Boring questions are not cool.” When Joseph Spak of RBC Capital asked how many of those who’d reserved a Model 3 sedan have actually gone ahead with the reservation, Musk directed the call’s operator to switch to YouTube remarking, “These questions are so dry. They’re killing me.”

Prominent Tesla bear, Cowen & Co.’s Jeffrey Osborne, wrote a note where he declared that “Tesla’s earnings calls have always been one of the best free sources of entertainment out there, but this one was the over top [sic].” He added,

In one of the most bizarre earnings calls we have ever heard, Tesla refused to address analyst questions on capex, cash burn and other “boring bonehead questions” while providing commentary on “barnacle” like third-party contractors and anecdotes on an ineffectual “flufferbot”.

'Elon Musk' by Ashlee Vance (ISBN 0062301233) On the first-quarter call, CEO Elon Musk also promised a reorganization” this month. He said,

I’m feeling quite confident about hitting positive cash flow in Q3. This is not a certainty. It does appear quite likely in my view. We are going to conduct a reorganization, restructuring of the company this month and make sure we are well set up to achieve that goal. In particular the number of third-party companies we’re using has gotten out of control. We’re going to scrub the barnacles on that front.

Osborne had previously said,

The story keeps breaking down here in terms of the ability to hit overambitious targets from management … so the tone of the release last night certainly has been a bit watered down and I think they’re just starting to try to regain a little bit more credibility … but in general we just see continued execution delays, a lack of profitability over the next two to three years and, with Elon Musk’s world domination strategy, just with the additional factories he wants to build over about 15 to 20 billion dollars of additional capital that he’s going to need to build these battery and car factories in Europe as well as in China.

Tesla stock promptly dropped more than 5% in after-hours trading.

Tagged
Posted in Investing and Finance Leaders and Innovators