The Arch Dilemma

Are You Willing To Stand Under the Arch?

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

As all of you know I write a great deal about management and leadership, especially from the perspective of leadership as a gift rather than entitlement.

I saw an excellent blog post this morning that mentioned the fact that although US companies have spent literally billions on engagement programs we have made very little progress on creating environments where employees are truly engaged. The most recent Gallup studies indicate nearly 74% of American workers are either minimally engaged or actively disengaged.

I am not going to rant again about the literally billions of productivity and human losses that number represents, but suffice it to say it is there.

I think in many cases we have an accountability vacuum in our society in corporate and especially in government.

The reason I emphasized that the majority of spending was on engagement programs is because I passionately believe that is a big part of the problem- it is addressed as a program and assigned to some department, typically human resources to manage. So they go through the motions.

The vast majority of human resources departments are skilled at and managed for compliance, they keep the lid on.

We call basic skills like clear expectations, giving feedback, taking corrective action, and coaching soft skills. Oh yeah, we also don’t teach them in our B schools.

I am surprised engagement is at 36%…

Engagement is a culture and the accountability for it belongs in the C suite.

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

He proposed that my entire incentive be based on executing a meaningful improvement, (ten percent or more), on our employee climate survey. I would be the only manager who had this goal.

I countered with the idea that I would put the same percentage of my incentive on the line for that single metric as he was…As you might suspect he wasn’t amused. He also declined to accept my challenge. He wouldn’t stand under the arch.

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

When I teach leadership classes one of the challenges I make to “graduates” is to go to work every day being prepared to be fired for doing the right thing. I especially challenge C level leaders and HR people to make that commitment.

I don’t think everyone at every level should be expected to stand under the arch, but if you aspire to leadership I think it is a key requirement.

Authority must be balanced with responsibility in a kind of yin and yang relationship.

That is why I like Stephen MR Covey’s hierarchy of trust from compliance through competence to identity.

The old models are horrifically obsolete.

When you hear all the ranting and raving about how Millennials and Gen Y are lazy your bullshit meter should be shrieking. They aren’t lazy; they just refuse to follow leaders who aren’t willing to build their credibility on a platform of identity and stand under the arch.

Can we really say that they are wrong….?

Would You Join My Tribe?

Building A Company Tribe

In organizations, real power and energy is generated

through relationships. The patterns of relationships and

the capacity to form them are more important than tasks,

functions, roles, and positions.”

Margaret Wheatley

When people ask me what I do I have been known to facetiously say – I build cults, but I think that that particular description can be perceived pretty negatively so I have been thinking on a more appropriate way to describe it and I like the idea of building company tribes.

A tribe in the most common context is a group of people who have shared ancestry, but can also be a group who shares values, beliefs and customs.

I rather like this definition of a tribe; a group of people who share values, customs and beliefs and work together to optimize the collective good. The neat thing is this definition can be expanded to include your stakeholders including customers, shareholders, and even the community in addition to employees.

Anyone who is familiar with my body of work knows that I have a deep and abiding investment in two core beliefs-

  • Building an organization based on commitment and shared values will always be more successful than building an organization using compliance as a base.
  • We hire, manage, coach, and interact with whole people; not just their knowledge, skills and abilities.

As a human resources practitioner and C level executive I learned through experience that people join cultures and leave managers. I also learned that no organization will see greater success from their product brand than their employment brand over the long term.

We are seeing the results of poor employments brands every day.

Employee engagement continues to hover in the high 20s to low 30s where it has been for the last five years or so.

The economy is starting to improve and the repressed demand for more equitable wages and treatment is starting to surface in major ways. Almost fifty percent of workers in recent surveys reported that they were likely or very likely to pursue new employment in the next 12 to 18 months.

The Department of Labor estimates that employee turnover; both voluntary and involuntary, costs the U.S. economy $5 trillion annually in hard and soft costs.

The American Mental Health Association says we lose another $200 billion annually to the phenomenon of presenteeism, where people show up to work, but perform substantially below their capabilities because of job related stress, dissatisfaction, poor management and other related factors.

Our recent recession gave employers a bit of an edge by lowering employment opportunities and I believe moved back progress in the employment relationship, but now it is time for payback.

I don’t just want to dwell on the negative, there are substantial motivators for creating an engaged tribe!

  • Hay Group studies show that high engagement can improve revenue growth by 250 % and reduce turnover by as much as 40%.
  • 70% of organizations with high engagement exited the downtown with higher levels of employee motivation than pre-recession.
  • 90% of the Fortune Magazine Worlds’ Most Admired Companies have developed and maintained an explicit employment brand. An employment brand is systemic. It permeates the entire organizational culture at every touch point from recruitment and selection to interactions with customers, community and other shareholders. It lives at the C-level, not in HR.

Your frontline employees are the organization to your customers. If they don’t feel the passion and the commitment they will not reflect it. Global research organization ISR’s Research Director, Patrick Kulesa, states it clearly:

Our research continues to show that a well substantiated relationship exists between employee engagement – the extent to which employees are committed, believe in the value of the company, feel pride in working for their employer, and are motivated to go the extra mile- and business results.

So how did we go wrong? I will give you my short answer-

  • We have not captured the energy and commitment of the American worker. We have used technology and systems in many cases against rather than on behalf of people. In short we have disengaged them.
  • Our management and leadership models do not appropriately value and reinforce the importance of relationships and people.

I remember entering the workforce and being surprised that we didn’t think that employees were very smart. We relied heavily on compliance based models rather than explaining our goals to them and enlisting their support.

We rarely involved them in decisions about how to do something. We didn’t explain systems like health care or materials management or in some cases even the legal environment. Managers managed and people did. I was pretty naïve and wondered why if we thought all these people were stupid, why did we hire them?

Let’s look at the curriculum of the average MBA program-

The amount of the curriculum that deals with communications, setting expectations, and skills like giving and receiving feedback constructively or coaching are dwarfed by financial modeling, economic models and related studies.

In a HBR (Harvard Business Review) article a well- known management consultant was recommending to business and organizational leaders that they distance themselves from engagement initiatives. His premise was that engagement as it is being marketed is largely about morale and employee fulfillment rather than performance.

While I don’t disagree that much of the language and programming around engagement fits his description discarding engagement is overly simplistic. Engagement is about alignment and should be tied to individual and organizational performance.

Although engagement will look different in different organizational cultures; there are several factors that will transcend organizational and culture boundaries- you will find them present in any engaged organization. Those elements include the following at minimum:

  • A foundation of trust and mutual respect
  • Clear expectations and feedback mechanisms at all levels of the organization
  • A clear and compelling value proposition.
  • An equitable and transparent system for delivering compensation.
  • A competent leadership and management team who have the total skills portfolio to attract, retain, and reinforce the values of the organization
  • Recognition and reinforcement of every employee’s responsibility to participate in the process actively rather than passively.


Over 30 years ago a gentleman named Roger Deprey created a model he called the Human Resources Pyramid®. It is composed of an employee’s ability to answer six questions in a particular order-

  • 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?

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.

You see, when you answer those six questions you have invited employees to join your tribe and they have accepted your invitation.

My template for creating your tribe is not complex, but it is not easy…

  • 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, your model is 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.

I won’t mislead you. Making the commitment to build a tribe is hard work and a journey rather than an event. It has to be approached systemically, you can’t pick and choose the elements you want to work on and expect success.

On the other hand when you look at the impact on every key performance indicator from shareholder returns to reduced turnover and increased per capita productivity I think the ROI is there.

So in summary I leave you with this parting thought…

Companies have a hard time distinguishing between the costs of paying people and the value of investing in them. Thomas A Stewart

I rather think the numbers speak for themselves….



Get it Right!

A colleague posted something on LI today that I have known for a very long time- employees want and need more performance feedback, not less.

It is almost impossible to pick up a business publication these days that doesn’t castigate the performance evaluation process used in most organizations and justifiably so. They are usually pretty lousy processes conducted once a year where we tell people that their performance is not at the level they think and they are not going to get the raise they believe they deserve.

We do performance evaluation almost as well as we do hiring and selection- which for the most part is poorly.

I hear frequently how the culprit for these poor processes is the human resources department. As I was a human resources manager and executive before I moved to the C level, I can tell you in most cases that is absolute bullshit.

The role of Human Resources in my opinion is to facilitate and provide guidance. Hiring and performance management belong to the manager.

The problem with managing is that we are dealing with people, not human capital.

People are pesky. They want things like clear expectations and meaningful feedback. They expect their supervisor to connect the dots for them on how their efforts and contributions connect to the larger picture.

They expect us to connect their performance and the decisions we make about their compensation and career growth. How arrogant of them!

A recent Gallup poll concluded that 82% of the time organizations fail to make the right choice in selecting candidates for leadership and management positions.

James Harter, Gallup’s chief scientist for workplace management was quoted as indicating that only 18% of the population of current managers possesses a high level of talent for managing others.

The critical talents identified by Harter include:

  • The ability to motivate others
  • The capability of being assertive balanced with making people comfortable
  • The ability and commitment to making tough decisions
  • The ability to build and maintain strong relationships

The big culprit is our selection process, in the U.S. the majority of managers are promoted based on one of two criteria-

  • Their competency at previous non-managerial roles
  • Their tenure in the organization

Is it just me or do you notice that skills like setting clear expectations, giving meaningful feedback, taking appropriate corrective action, and coaching are missing from the selection criteria?

Contrary to popular opinion I don’t believe an MBA prepares people for leadership. It exposes candidates to systems and integrative thinking and how the disciplines interact together, but there is little emphasis on the management of talent, so the answer isn’t to populate your management ranks with people with no managerial/leadership experience or training, but MBA’s from “name” schools…

Similarly I see tomes written on the application of technology to hire, manage, deploy and optimize performance. I am not technology phobic by any means; I do adhere firmly to the belief that technology is a tactic, not a strategy.

So you might be asking, what do I suggest to “fix” this issue?

I suggest we begin with being able to answer the following questions for each of our employees-

  • What is my job?
  • How am I doing?
  • Does anyone care?
  • What is our mission/function?
  • How are we doing?
  • How can I help?

My experience is that many organizations spend an enormous amount of time and energy answering questions 4 and 5, but we don’t lay a foundation.

Once we can answer those questions for every employee, I set a goal to answer yet another set of questions-

  • How Do We Generate Revenue?
  • Who Pays Us Our Revenue?
  • What Is Our Unique “Value Proposition”?
  • How Does My Job Meet Our Mission And The Big Picture?
  • What Unique Factors Do I / Can I Bring To Directly Or Indirectly Support Our Mission?

Some people may read this and say, but I am a not for profit so some of these questions don’t apply.

I would respond au contraire-

If you are not generating revenue and you have no unique value proposition you are in big trouble…

My experience, validated by my colleagues post indicate that every employee is interested in four (4) key things from their employer-

  • Respect
  • Clear Expectations
  • Meaningful , Balanced Feedback
  • Equitable, Clear Reward System

These themes really double back on one another. A relationship with trust and respect incorporates the other elements.

The old employment model based on loyalty (spelled obedience and compliance) is dead, let’s bury it.

The Gallup study indicated that less than 20% of the current management population has the right skill mix to manage talent well. They describe that skill mix as-

  • The ability to motivate others
  • The capability of being assertive balanced with making people comfortable
  • The ability and commitment to making tough decisions
  • The ability to build and maintain strong relationships

At the risk of stating the obvious continuing the model of promoting leaders based on technical competence in non- managerial roles and tenure isn’t going to address that skill mix proactively.

We are bleeding billions annually in lost opportunity from employee engagement that continues to hover in the low 30’s.

What are we waiting for…?SAM_1552

What’s Your Value Proposition?

I have occasion to come into contact with a number of not for profit organizations on a regular basis ranging from very large organizations like education and health care providers to local service providers with a much narrower focus.

I use the term not for profit as opposed to non- profit very deliberately. The point that I try to make with these organizations is that profit at its most basic is the amount of revenue that exceeds expenses and there is nothing fundamentally immoral or amoral about how that excess is distributed.

I find that the idea that an organization should goal for and achieve solvency on a regular basis doesn’t always make me very popular. The idea that the organization should be held accountable to have a clear and compelling reason that it exists and perform its services in an efficient manner is seen by many as an elitist or purely capitalistic viewpoint. I disagree.

I find Seth Godin to be one of my favorite business authors. I don’t put him up on a pedestal or see everything that he writes as either brilliant or that I agree with, but he provided some simple points for would be entrepreneurs that I think have application for every organization-

  • If you have never been paid for your product or service it is a hobby, not a business.
  • If the only people who have ever utilized your product or service are friends and family it is a hobby, not a business.

I have encountered as number of not for profits who believe that their first and most compelling objective is to raise funds and invite donations to their cause.

The idea that they should be able to articulate what it is they are trying to accomplish, how they differentiate themselves from others who provide the same or similar services, and how they seek to become and remain sustainable and viable often seem to be secondary at best.

On the other hand I see organizations that do provide meaningful services and a clear and compelling value proposition who are severely criticized because they do things like a successful business-

  • Create and execute a business strategy
  • Create a strategy to attract and retain the talent necessary to drive the organization and pay that talent competitively.

The most common criticism I hear is that non-profits do not pay any taxes so their spending money on marketing and human resource infrastructure is inappropriate.

The reality is that in most cases the only tax an NPO doesn’t pay is income tax. The other reality is that running a complicated NPO is not significantly different than running any other kind of enterprise and requires the same kinds of talents.

I worked as an executive in the Credit Union industry for several years and then and now heard the criticisms from banking and other financial institutions about the “unfair” advantages that credit unions enjoy.

Rarely do you hear about the restrictions that apply including a significantly higher rate of reserves, limitations on the structure of their loan and product portfolio, and depending upon whether they are State or Federally chartered restrictions on the process of expanding geographically or even within a given geography.

I happen to believe that our society and in fact our world economy has become complicated enough that no one sector is able to address all of the issues facing us and a new model has to continue to emerge. I think we have seen evidence that I am not alone in my thinking.

I am intrigued by Warren Buffet and other billionaires who have signed a pledge to invest in philanthropic endeavors with a minimum of 50% of their net worth. That means the minimum buy in is a half a billion dollars – each.

The reasoning behind it was classic Buffet, who said that once you reach a certain point in wealth the incremental benefit to you personally is minimal if it exists at all. When asked about whether it isn’t more appropriate to leave it your heirs he said no- that creating multiple generations who are further and further from the actual activity that generated the wealth is an unhealthy process.

I agree. I didn’t have the benefit of growing up in a family that endowed me with a large bequest upon my parents passing and neither do I plan to provide my children with such in the event I become rich and famous.

The discussion about why or why not a billionaire should turn to philanthropy and whether or not this allows the ultra-wealthy too much control was interesting as well.

The biggest reason they stated was ability. They have the financial means to make a difference. Several also talked about with humility about learning to play in a different world with a different set of metrics.

I like the discipline that some of these business leaders have brought to the philanthropic process. I think it is okay to expect a philanthropic organization to have clearly articulated goals and for progress to be measured as to their achievement of those goals. That to me is the most important metric- is you creating measurable results?

So I would ask that we evaluate whether to create and fund not for profits under those terms-

  • Can they articulate a meaningful value proposition and means to address the issue they identify?
  • Can they provide these services in a manner which is efficient and represents a good societal investment for individuals and organizations?

At the end of the day all organization should be judged on how well it articulates and achieves its mission. It is that simple and that complex….



Meeting People Where They Live

Read an interesting post today from Bruce Kasanoff recommending we step away from the old adage of “teaching people to fish” when they are truly hungry.

He points out that when people are truly hungry they need nourishment, not wisdom.

That really shouldn’t be news to any of us since Maslow created his hierarchy of needs decades ago, but it seems like we still struggle with it on both sides of the employment equation.

I am a really big fan of employee engagement. I believe, and the statistics bear me out, that organizations with high employee engagement outperform their lesser engaged counterparts in every key performance category.

So you might ask- Why wouldn’t every organization be investing in employee engagement strategies?

The answer is that creating and more important sustaining an engaged environment is hard work. You don’t accomplish it by administering a survey or creating a project team, or making the human resources department accountable for it.

You also never arrive; sustained employee engagement is a moving target. People’s needs and expectations evolve.

The other thing is that employee engagement is not a management initiative, but rather a partnership. Employees have as much responsibility for engagement as management does. It is something we do with people not to them.

A few years ago I published my first book, Managing Whole People, with some of this in mind. We don’t just manage two dimensional people so if we are going to create and sustain the relationships that lead to true engagement we have to manage the whole person, not just the employee.

We also need to take into consideration where the organization is and where people are and make our matches pretty carefully.

Two dimensional hiring is based on all the stuff that compliance has taught us about being very careful to describe the skills and knowledge and tasks we want performed. Many HR practitioners get very nervous when we talk about things like attitudes and attributes because they are less precise to quantify, but the reality is these characteristics play a huge role in how successful an employee is in any given environment.

Bruce’s comment caused we to think about two of the most common and often unsuccessful initiatives I see organizations embark on a regular basis-

  • Training
  • Change Management

As a consultant it is not uncommon that I receive a request to develop and implement a training program or initiative for an organization.

When I ask why they want training they usually respond – we aren’t getting the behavior or performance we are seeking.

When I respond – Why training? – They often get annoyed. My point to them is that training provides a skills base or model. If what is preventing the performance is attitudinal or other factors training won’t fix it…

Similar with change management, we usually try to do change to people rather than with them. In short we don’t meet them where they are.

That doesn’t mean that we have no right to expect people to modify their performance or behavior it just means understanding what the real impediments are is critically important.

Employee Engagement is a higher level state of performance. It requires some fundamental infrastructure to succeed. Things like trust, respect, clear expectations, constructive feedback, line of sight, and a host of others.

You can’t achieve engagement without mastering these and we still refer to many of these skills as soft in our management theories and discussions.

Worse yet there are many who have adapted the organizational brilliance that emotional intelligence and empathy are gender based and that women are inherently better equipped to succeed in those skills.

Please, for me that rates right up there with the stereotypes we used to attribute to racial or cultural groups.

We have the opportunity to return to the old social contract that the Founding Fathers conceived of when they included personal competency to balance personal property.

Over the years of industrialization and embracing the theory of scientific management, which created the concept of white collar versus blue collar, we lost a lot of the personal competency.

I believe as I covered in my book Plan B- An Alternative to Obamacare, this is a big part of the issue with our health care delivery system. We abdicated personal responsibility for managing our personal health and a very complex system grew up to manage it for us.

Now we have the responsibility back, but little education or information about how to navigate it.

As those of you who are familiar with me and my work know I am deeply committed to a few key concepts. Among them I include building your organization on a foundation of commitment rather than compliance and the concept of personal competency.

There are a lot of other things that inherently embedded in those ideas, but they really represent the foundational pieces.

In the first is the idea that when people come together with a shared set of values and clarity about our purpose proactively and willingly the amount of energy they will bring to that effort increases exponentially.

The second is the idea that people are whole. They perform best when we give them both an opportunity and an expectation of being present. My colleague Reut Hebron Schwartz describes it in part as Kind Excellence. She would tell you there is not true kindness in letting someone meander through their life or career working at 70 or 80 percent of their capacity. Neither can you achieve excellence by simply providing someone with a template and punishing them if they do it wrong.

Social gravity is the emerging concept of describing your value proposition in such a clear way and operating with such consistency that your stakeholders including customers, employees, shareholders, suppliers, and communities are drawn to you. There is a community of interests that is clear and compelling.

Social gravity doesn’t look the same in every organization. Since the dawn of the Industrial Revolution we have really developed an infatuation with best practices to the point we want to use them almost like recipes.

When I see surveys that conclude that most leadership failures occur because of organizational fit, interpersonal dynamics and relayed human factors I have to say I find the perplexity of failure of technology to guarantee sustained success ironically amusing. The answer is right there. It isn’t about processes it is about relationships. Processes can facilitate communications and tasks, but they can’t create relationships. That is a uniquely human dimension.

So I would suggest once again let’s endeavor to manage whole people and to do that we have to meet them where they are….SAM_1552

A New Leadership Model


The topic of leadership is one that consistently takes up space on every social media forum and management development curriculum, but the interesting thing is are we learning and changing anything?

If we look at the opportunity costs offered by things like employee engagement and reduced expenditures in health care from partnering with employees and health care providers to manage health not health care they are enormous, yet over the last few years we have seen minimal progress.

Employee engagement, where employees feel aligned and are contributing at their highest and best levels has pegged at around 30% even though there is an abundance of information tying higher engagement to increased productivity, higher profitability, and reductions in health care expenditures, absenteeism, and related costs.

In many cases the responsibility for increasing employee engagement is placed with the human resources department so I see a lot of criticism of that function including why it should be eliminated or minimally split into two distinct functions; administrative- which would manage payroll, compliance, benefits administration and other procedural activities and organizational development, which would lead talent development, succession planning, and other “higher end” activities.

As a former human resources and C level executives I see a simplified solution like that as an “epic” fail.

The dirty little secret that most of us don’t like to discuss is that engagement doesn’t fail in the HR department; it fails where employees and managers collide.

The problem is that society has evolved beyond our leadership models.

Ted Santos covers many of the issues very nicely in his recent blog post,

For decades, many CEOs rose from sales and marketing. They were great at knowing the product, customers, driving innovation and selling the organization on a vision. In the recent past, they rose from finance and law. They bought back their own shares, orchestrated financial reengineering, changed accounting practices and down sized the company. They have been the masters at making the organization profitable”.

For over 100 years the prevailing model was that people were at best human capital, their sole purpose was to perform a set of routine tasks. As a result they were usually marginally paid and treated as expendable.

This was the leadership model I “grew up” with. As an emerging leader the skill sets were planning, directing, budgeting, and controlling. Last time I checked these were things you do to rather than with people.

We then evolved into the technology age where technical specialists were exalted and paid very well with the key leadership skill being how to leverage their ingenuity and expertise into marketable products.

Over the last few decades the financial analyst has reigned supreme. This is where we saw aggressive downsizing, offshoring, and other techniques to maximize short term financial return.

I mentioned in a previous blog that the vast majority of the benefits of the financial recovery where “reinvested” in things like stock buybacks and dividend distributions which exacerbates that mentality.

Santos quotes several former CEOs as recognizing this model is untenable for the long term-

“…When I was younger, I worried about managing the money, metrics and processes of the company. As I became older, I realized the business was about people. Therefore, I learned to take care of the people first. When I did that, they did a great job of taking care of the money, metrics and processes. It made my job a lot easier. If only I would have figured that out when I was younger.”

He goes on to say (and I hope he is correct) that the most important skill set for emerging leaders will be that of social reengineering.

This shouldn’t be rocket science. If you look at top performing companies like Zappo’s, Starbucks, Amazon, Google, etc. they have made significant efforts to reengineer their human resources processes not only internally, but externally as well.

Jack Ma, the CEO of Alibaba, spoke directly to this when he mentioned that in his stakeholder model the interests of customers and employees come before shareholders. When he was told that isn’t the U.S. model he simply replied, “I know, they are doing it wrong.

Another very good post on LinkedIn today reemphasizes this concept with Three Ways to Frustrate Your Frontline Employees-

  • Unrealistic Expectations
  • Dictate From On High
  • Sub- Par Supervision


Now hear is the bad news.

Technology isn’t going to fix any of these issues, nor is lean or six-sigma, or other new age solutions. The other bad news is that none of these three elements live in Human Resources so splitting or getting rid of your HR department won’t fix them either.

It is going to have to get messy. We have to do a better job of hiring, selection, and deployment. We also have to rewire our Leadership paradigm.

I am not going to make any apologies for being a huge advocate for developing and implementing employee engagement strategies in every organization. The key word is strategy. Simply announcing an initiative or doing a survey annually is not going to cause engagement to spread like the Ebola virus in Africa! You have to do some real work.

The first thing you do is to identify the core value proposition of your organization and develop a strategy to clearly communicate it to all of your stakeholders; this includes employees, suppliers, customers, shareholders, and communities where you do business.

The second thing that you do is that you develop hiring and selection processes that ensure that the people you invite to join your organization share the value set of the organization and that the connection between their personal values and your organizational values is transparent.</p>

The third thing that you do is ensure that anyone in a management or leadership role has the competencies and skills to create and reinforce that line of sight.

The fourth thing that you do is make sure all your other systems reinforce the values as well. By that I mean your hiring and selection, training, compensation, performance management, and your succession planning, and promotional decisions.

The fifth thing you do is to benchmark your progress and recalibrate as needed. Perception is reality, if your employees don’t feel aligned with your core mission and objectives they will not perform at peak.

This requires a different model for both developing and defining leadership.

I like the way Jack Welch describes it-

“…leaders are generally not judged on their personal output. What would be the point of evaluating them like individual contributors? Rather, most leaders are judged on how well they’ve hired, coached, and motivated their people, individually and collectively—all of which shows up in the results.”

I guess it isn’t essential that organizations accept the need to evolve and embrace the new management model, but when you weigh the consequences-

  • The latest Gallup poll provided some pretty eye opening statistics, including the fact organizations with high employee engagement saw a 147% advantage in earnings per share over non- highly engaged organizations in 2011 and 2012.
  • The fact that the Department of Labor estimates that disengagement costs the U.S. economy between $450 and $550 billion dollars annually and for me at least that garners some attention.
  • Recent studies indicating that voluntary turnover was up 45% year to year from and cost per hire is up 15% for the same period and you might think that more organizations would be examining their strategies and taking action.

Why in the world would we want to continue with a model that is obviously outdated and not generating the kinds of financial and social outcomes we deserve?

What do you think….?

Balancing Our Perspectives

I have had a chance to read a few things and to chat with a few people over the last week or so that intrigued me and caused me to think about how they interconnect.

One of the first was an article in the October 2014 HBR that discusses what the author calls the rise and likely fall of the Talent Economy.

Being that my formative corporate experience was in the human resources management field the idea that we had shifted from natural resources and capital to perceived intellectual capacity was fascinating.

To me when we look at the opportunity costs represented by employee turnover and disengagement the criticality of properly identifying, deploying, and retaining talent isn’t a huge surprise. What was interesting is how talent is described in the context of this article. The most significant talent described here was wealth creation and the creativity to create products and markets with high rates of return.

I also found it interesting that the author feels like focusing on wealth creation to the benefit of the few rather than the many is a huge issue. The most significant benefit of the shift to talent is to the people at the very top of the organization through very high salaries, stock and other equity sharing arrangements and models that benefit few rather than many.

The description of talent is more reminiscent of Michael Douglas in Wall Street, or Richard Gere’s character in Pretty Woman, than a discussion of great artists, inventors, or musicians. It does in part explain why even though the statistics on the costs and opportunities of employee engagement are so clear why we still don’t see the majority of organizations addressing it as an organizational initiative.

We don’t see managing talent as a highly critical or valuable skill set.

Another interesting perspective I got to explore this week was that of Jack Ma, the Founder and CEO of Alibaba, the highest value IPO in the world in an interview with 60 minutes. From a western perspective Ma uttered economic and organizational heresy when he stated that in balancing the needs and desires of stakeholders he put them in order of customers’ first, employees second, and shareholders third.

What a difference from our western perspective where we worship at the shrine of the shareholder. This is well represented by the fact that the vast majority of the financial benefits of the recovery have been reinvested in stock repurchases and shareholder distributions and dividends rather than talent acquisition and retention, product development, or other areas.

Earlier today I had a great discussion with a colleague about his frustration with his current organizations lack of attention to emotional and social intelligence focusing almost exclusively on intellectual intelligence.

Some of this thinking is likely reinforced by articles like Adam Grant on LinkedIn today discussing how emotional intelligence for fields like engineering, sales, and analytical endeavors is highly over rated and likely leads to distractions and doesn’t predict high levels of success, instead may distract those practitioners from the relevant data and decision making influences.

The key is that while those may apply to individual contributors once someone advances into a management or leadership role it is all about others!

Where in the process do we expose those emerging leaders to a set of skills that are different than the attributes we hired them for in a previous role!

The answer is in large part we don’t. Just as talent was described previously as creating shareholder value we typically promote based on technical talent often with little consideration of interpersonal and social intelligence skills.

We rely heavily on the trust generated by position, authority, and perceived technical competence rather than identity based trust which is much more critical in leading people.

I don’t dismiss the importance of intellectual capacity and technical proficiency in performing any role, but I think where we are relative to how organizations are investing their profits and the trillions in opportunity costs we bleed annually with minimal employee engagement and constant turnover says we need to look at the relationship side as well.

There is no one right leadership model just as there in no one right culture. The keys are alignment and reinforcement.

I think Jack Ma might be right, for sustainability it is critical we move from a shareholder to a stakeholder mindset.

What do you think……SAM_1552

What’s Your Brand?

Your Leadership Brand

I think that most organizations today recognize that beyond their product or service brand intentionally or unintentionally they have also created and promulgate an employment brand.

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

Some organizations enjoy a very strong employment brand. I would include Google, Starbucks, Accenture, and Zappo’s in this arena. People have a pretty clear perspective about what these organizations value and the profile they seek.
Other organizations fairly or unfairly occupy the opposite end of the spectrum. I would put Walmart and currently McDonalds in this area.

We live in an environment where the competition for experienced talent is becoming more and more pronounced and a recent survey pointed out that the rate of voluntary turnover; employees electing to leave their job, increased by 45% between 2012 and 2013.

Since the average cost of hiring has increased 15% during the same time period attracting and retaining talent is a key consideration for businesses and organizations of every size and in every sector.

I have written, spoken, and even publically pleaded with organizations about the importance of employment branding and its direct and indirect connections to employee engagement, so I am not going to focus on it a great deal here, but instead discuss leadership brand.

Leadership has of course been dissected and discussed ad naseum, but I would hardly put a stake in the ground and declare victory at this point.

Personal branding is also a hot new topic in terms of how you represent yourself and are seen by others.

The impetus for this particular piece is two events, an opportunity to spend some quality time with a colleague from the UK with whom I share a deep and abiding interest in leadership and other organizational dynamics and a post I read earlier this week.

The post talked about a father’s conversation with his son who had just completed a summer internship. When his Dad asked him about the experience he replied that he enjoyed the work and his colleagues, but the “big boss” was a real jerk. The father was somewhat surprised that his son had an opportunity to meet the most senior executive of a large corporation as an intern, turns out he hadn’t.

The son’s perspective was framed entirely from correspondence and the perspectives shared with him by colleagues and coworkers. I think we can say this leader has a leadership brand issue…

The discussion with my colleague goes back to a set of novels (yes I admit I read and enjoy fiction) written about the evolution of King Arthur and Camelot. I found it more interesting than most series because it actually started two generations before Arthur was conceived and outlined a leadership development strategy and succession planning that modern organization could take a page from.

Leadership as described in the Camulod context included some concept that Malcom Gladwell and Stephen MR Covey have discussed and I find intriguing.

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

• Those whom are governed have a voice in the process; their input is sought and heard.
• There is a dimension of predictability and consistency in the application of the law or standards.
• The application of the law or standard has to be administered fairly and objectively, you can’t have disparate treatment without a clear and compelling reason.

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

I 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.

Ken Follett’s trilogy about families from several countries and several generations explores this entitlement theory in a very interesting way.

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

I have encountered literally hundreds of recent MBA graduates who are supremely confident in their ability to lead based on their shiny new diploma demonstrating mastery of the concepts.

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

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

What I found fascinating about the development of the leadership models as they evolved in the Camulod series was that although they used different language, these elements were present.

Arthur’s grandfathers realized that to be crowned the one true King of England, he would need not only position and competence, but legitimacy and identity based trust.
There are a zillion different leadership styles in the literature, I happen to be a big fan of Blanchard’s Situational Leadership® model which recognizes one size doesn’t fit all either with people or organizations.

There is a lot of discussion about servant leadership and to the extent it incorporates legitimacy and identity based trust I think it has merit.

I read the articles and posts that have taken the position that women are inherently more dispositioned to be leaders and genetically coded to have higher emotional and social intelligence and my reaction is bullshit.

The issues aren’t gender based, but I believe more a matter of aptitude and training. Our leadership models were based on competency and deterrence for generations and ignored identity so we practiced a flawed model.

So my recommendations in cultivating your leadership brand-

• Build on a base of identity based trust. You will likely have to master the first two levels to achieve that.
• Ensure that your actions incorporate legitimacy both implicitly and explicitly
• Manage people, not human capital. People are individuals, respect that and treat them accordingly.

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

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

Incorporate the elements of respect, responsibility, information, equitable rewards, and mutual investment. Those represent an excellent foundation for both legitimacy and identity based trust.

It worked for King Arthur, and you have to admit he has a pretty cool leadership brand….

Focus On Relationships!

I had a chance to read an article in the September 2014 edition of the Harvard Business Review that I found alarming and disappointing. The author talked about the fact that in a ten year period from 2002 to 2012 members of the S & P 500 had reinvested close to 60% of the profits they made in re-purchasing their own stock and close to another 30% in dividends to shareholders.
His point is this is why we are seeing a “jobless” recovery. Rather than investing in growth or compensation for the average employee we see distribution of the fruits of increased performance going to very few- the shareholder versus stakeholder mentality.
This is I suspect a large part of why we see that employee engagement has pegged at about 30% and remained there for years. We still don’t look at employees and their appropriate recruitment and retention as a strategic initiative.
There is quite a bit of buzz these days as to whether or not the traditional human resources function should be disbanded or minimally separated into two distinct components; an administrative function responsible for compliance, payroll, benefits administration, etc. and an organizational development function which is responsible for talent acquisition, training and development, succession planning, and other strategic components.
I am not a fan of this model. I believe that strong performing organizations are based on alignment and systems that integrate and reinforce that alignment, separating the functions disperses the synergy and responsibility.
I advocate a different model where the management of talent is a core responsibility of everyone in leadership. Human resources provide the technical expertise and facilitation, but managers in every function actually manage the talent assigned to them.
The relationship component is critical at every level. I read a couple of pieces today that I think really illustrate that point.
In one piece the author was describing to young people the importance of playing well with others, building and sustaining relationships over a lifetime not just transactionally.
As recently as this weekend I heard from someone that as they aren’t currently in a job search they don’t see the value of investing in networking or using social media systems like Linked In. That to me is a perfect example of transactional thinking.
Another piece talked about one of my favorite topics- trust.
The piece explored the trust relationship not only between organization and customer and employee and supervisor, but employee to employee.
In my over 30 years as a human resources professional, C level executive, and management consultant it has been interesting to see emerging and current “leaders” bridle at the idea that they have to earn trust. For many it is an expectation that trust is embedded in their role, they shouldn’t have to earn it.
Stephen MR Covey does a great job of exploring and defining what he considers to be the three critical levels of trust we encounter:
• Deterrence, is the trust we invest in authority based on position or statutory regulations.
• Competence, as implied is trust based on perceived expertise, training, or skills.
• Identity, the highest level of trust in Covey’s hierarchy is the trust that comes from shared experiences and mutual respect.
I think understanding and building all three of these levels of trust into your approach and interactions with all stakeholders is the only meaningful recipe for long term performance for organizations and building engaged environments.
Unfortunately in my experience most of our leadership training and organizational models incorporate only the first two levels and in fact many new leaders assume an entitlement to competency based trust with their position.
Malcolm Gladwell’s book, David and Goliath, explores another concept we don’t discuss much in our leadership training- legitimacy.
While I enjoyed the entire book the part that most spoke to me was Gladwell’s discussion of legitimacy.
According to Gladwell legitimacy occurs when three elements are present-
• Those that 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.
Like all of his books that preceded it I enjoyed it a great deal. I see Gladwell as kind of a social facilitator and observer. He doesn’t try to present himself as a behavioral scientist with countless reams of data to support his conclusions, he makes comments and observations. The reader has the choice to accept or reject them.
The reason I find this discussion about legitimacy so interesting is in its application to the work environment.
For the last three decades I have been promoting and teaching the merits of an employment relationship based on Commitment rather than compliance. When the employment environment is optimized in a commitment based model it results in employee engagement.
It is very chic today to dismiss collective bargaining and unions as passé, but any student of the relationship between employer and employed realizes that up until the 1940’s the concept of employers need legitimacy through the input of their employees was considered ludicrous.
Unions fought very hard to legitimize their right to bargain with employers over hours, wages, and working conditions. I am not going to say that I believe collective bargaining is the preferred methodology or relationship structure between organizations and employees, but the concept of participating as equals didn’t come from management enlightenment.
When I look at the engagement numbers and correspondingly the lack of trust in senior management it would be hard to argue that the two aren’t related.
The emerging generations are pretty intolerant of assumed legitimacy and identity based trust, when we add fuel to the fire on where “management” is choosing to reinvest the rewards of increased profitability and organizational performance I can’t say I blame them.
I don’t think you need to negotiate your culture with employees, but I do think they are entitled to clear expectations, constructive feedback, and fair treatment.

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

Never Stop Coaching!

The Importance of Effective Coaching

Over the weekend I had occasion to purchase and read Strengths Finder 2.0. If you are not familiar with it, Strengths Finders is the assessment tool first developed in 2001 by the Gallup organization.

The essential concept behind it is that people who are given the opportunity to focus in the areas where their talents are most pronounced are much more likely to be engaged and have much higher levels of productivity.
A lot of these concepts were discussed in detail by Marcus Buckingham in his series of books and it isn’t my intent to go into them in detail, but there were some things that I feel are worth mentioning and reinforcing again.

The first is data collected by Gallup indicating that individuals who feel that like their work is aligned with their talents are six times as likely to describe themselves as highly engaged at work and three times as likely to describe their overall quality of life as excellent.

The reasons this matters to us as organizations-
• Engaged employees contribute at a level 20 to 25% higher per capita than non- engaged employees
• Organizations with high engagement scores outperform their competitors in every key performance metric
• Highly engaged employees are 80% more likely to stay with their employer

Now let’s examine the role of your manager in your engagement-
If you manager’s primary style is:
Ignoring you then the chance you will be actively disengaged is 40%
Focusing on your “development needs” or weaknesses the chances decrease to 22% you will be actively disengaged
Focuses on your talents or strengths there is a less than 1% chance you will be actively disengaged!
I think it is important that we recognize that active disengagement is not a passive behavior. These are people who come to work every day and spread their negativity. Studies estimate that this group represents about 17% of the U.S. workforce.

I think it is also important that you can’t count on these people to leave. They are not necessarily any more likely to leave than partially engaged employees. These are the energy vampires who tend to be heavy utilizers of your health and time off benefits, more prone to industrial illness and accidents and just generally drain your productivity.

I have been reading a lot lately that the Human Resources function is in jeopardy of becoming obsolete because responsibilities like administering compensation, hiring and selection, coaching, and corrective action are being “delegated” to line management.
It makes me frankly laugh my ass off. In organizations I have been associated with those responsibilities have always belonged to line management. My role as a human resources professional is to be a consultant; to provide systems and training to those managers so they do those things well, in short to build capacity. The professions obsession with compliance has always been a disappointment to me.

The other thing that bothers me is that we still refer to skills like coaching, setting expectations, giving feedback, and taking corrective action as soft skills. Look at Gallup’s numbers again; is something that can have that significant of an impact really soft?

I also get frankly annoyed when we take the course that interpersonal skills like emotional intelligence and empathy are somehow gender based. They are competencies and talents that need to be identified and reinforced.
Anybody that knows me or has read anything I have written knows I am a passionate advocate for employee engagement. It is quite simply a better way to manage organizations and increase quality of work life and productivity.

My model is pretty simple:
• Manage for commitment not compliance.
• Hire and manage whole people.
• Include congruency in your hiring, selection, and coaching.
• Hire hard- manage easy.

This is a journey not a destination and as the Gallup numbers underscore it doesn’t stop with hiring or onboarding. Coaching and reinforcement is an ongoing process, but the return on investment is astronomical….