Leadership is NOT - the Right Person!

Excerpts from The Times, 19^th April 2012, Second Leader

Trouble In Store

But the Tesco story tells us much more about leadership than about rival ownership models.

Tesco is not the first company to stumble shortly after the departure of a highly successful leader. BP’s problems after Lord Browne of Madingley stepped down is one of many examples. Such powerful figures can often time their exits to go out on a high. Some analysts suggest Sir Terry was reluctant to recognise the need to change tack in the UK, which might tarnish his record, and that the board was too weak to force him to act or move on.

It is of course tempting to stick with a highly successful leader. But other boards and shareholders should see Tesco as a lesson in the dangers of allowing chief executives to go on too long.

"The risk of successful chief executives going on too long" is a symptom, not a cause. These (widespread) speculations on Tesco are just the latest example of the generally poor understanding of successful management cultures. Jim Collins in his book "Good to Great" documented many other examples of the effects of individual leaders.

The easy, and lazy, way has been to view leadership through cult of personality spectacles - "Find the right person and leadership happens". It is a self-fulfilling path to hazard because it licences whatever behaviour the "personality" then exhibits and enforces - Fred Goodwin and Gordon Brown should give us all cause to think.

On the other hand there are very successful organisations whose leaderships are consciously aware of, and manage, their behaviours, attitudes and beliefs together to achieve outstanding comparative competitive strength. They exhibit both individually and collectively high levels of changeability 

The fact is that leadership is about people and collective behaviours, not about the person and individual attributes.  There are far too many organisations in which leaders have recruited their management in their own image with two effects - built in under-performance and, sooner or later, a dangerous loss of innovative capacity; for a really dramatic example, the protracted and tragic demise of GEC under Lord Weinstock; for another?  Let's all watch to see what happens at Apple.

It doesn't have to be like this.  Changeability is an attribute that can be developed both at the individual and collective level and that, supported by the appropriate behavioural skills and discipliner, can transform the performance of any size of organisation.

The Cost of Behaviour is brought to you by Steve Goodman, Tony Ericson, Terry Murphy and Barbara Craven, the founding partners of Achievement Coaching International where we help businesses to learn different thinking to enable different actions that deliver the different resultsthat Make the Big Differences that Transform Results.

This series looks at the corrosive and far reaching effects for business profitability, and even survival, of failures in behaviour. It challenges all those that believe in “don’t rock the boat”.

You might also be interested in our "Excellence Quartet" of blogs promoting the cause of Excellence as the key to prosperity. We publish regular articles using a recent business/financial topic to highlight different perspectives and conclusions to those obtained by conventional thinking and techniques. You can read the other four blogs at our web site link page.

Free Sales Force - your Customer Heroes can recruit them for you

In our last post we wrote about how one individual bit of “careless” behaviour can destroy the hard won reputation of a premium value business. My personal experience (which was eventually resolved, more later) fuelled that blog but there have been countless high profile examples, such as Dixons/Curry’s lamentable customer service reputation which, to date, has cost millions to recover (the jury is still out in some branches), Npower’s “mistakes” with its customers billings, Baring’s Bank (!), Santander’s probate department and other big stories. But there is so much more, in everyday life for all of us.

Please think aback over the last month. Can you remember what has left you frustrated, and possibly fuming – the meal order not taken until you called for service, the ordered goods not ready for collection, the “special and exclusive offer” that turned out to be for you only if you were a size 3 supermodel, the Royal Mail "Delivery Collection" card put through the door while you were at home? There are so many opportunities for disappointments – and so many businesses that let their customers have them.

It doesn’t have to be like this, and in the truly excellent operations it almost never is.

However, although Excellence can look wonderful, the shiny shell of perfection can be an illusion. The reality is that this shell can be much more like a totally fragmented and then re-assembled egg shell, made up of thousands of tiny thoughts and actions that have to be kept together. One missing flake can cause it all to crumble. If an organisation relies on Quality systems, procedures, training and supervision to act as the glue, to hold the shell together, then it will always be vulnerable to the moment of inattention, the turning of a blind eye (You gotta be a team player), the avoidance of conflict (It’ll have to be all right, why make a fuss?), the cutting of corners (We’ll fill in the paperwork later) and all the other tiny bits of careless that can make any one of the flakes go missing. And then, when the customer has a problem, it can require very hasty footwork to try to make sure that they do not see through the missing flake to discover that, despite the glossy exterior, all there is really is an empty void.

Three weeks ago, a Product Warning advertisement asked if I had a Bosch Dishwasher made between 1998 and 2006, to check the serial and batch numbers, and then log into a web site. The web site informed me our machine needed an engineer visit and asked me to select a date from the displayed interactive calendar; I booked the soonest which was within 1 week and received an email confirming the engineer appointment. The day before I received a text message to confirm the booking and again the next morning before the engineer arrived. The smartly uniformed Bosch engineer replaced the main computer control unit in our machine, tested it thoroughly and re-installed it, all within one hour. Every step of his process had been thoroughly planned and prepared with check lists, van stock etc. His workmanship was meticulous and precise at every step. He cheerfully and openly explained that this was due to a problem that had, in only two cases, caused a domestic fire. Bosch had found that the cause was down to UK domestic supply voltage variations that exceeded their original design specification and that, as a precaution, they were replacing all units they could trace for the whole 8 or 9 year production run. Our machine is 10 years old. Now that is Living Quality, a demonstration by an engineer who believed totally in his Company, his Products and his Service. Here was Bosch’s Service Hero.

Oh yes, and here is the killer line for all you folk that worry about customers’ recognition of excellent service value, a few days later I received the Bosch Invoice that stated what had been replaced at no charge and, in very small print (that is the really clever bit, think about it), stated “The invoice amount of £176.68 plus VAT is covered internally out of goodwill”.

So, everybody, next time you are thinking about any form of household electrical product, my case is clear, go Buy a Bosch. They don’t weasel around warranty terms (Mini), or trying to dodge bad news stories (Renault), they stand by their products, their customers and their standards beyond reasonable expectations.

In my last post I quoted something I had written twenty years ago – the second half of that client briefing went like this -

WHO ARE THE BEST SALESMEN IN THE WORLD?

WHO ARE THE CHEAPEST SALESMEN IN THE WORLD?

WHAT IS THE BIGGEST SALES FORCE YOU CAN HIRE?

Your Customers

Your Customers

Your Customers

How can you Hire your Customers to Work For You?

1 Keep your Promises

* Deliver exactly what you said you would, or a little bit more

* Do it When you said you would, or sooner

* Do it at The Price you promised, or cheaper

* Deliver at exactly The Place they want

2 Communicate with them

* Be Seen to Listen to what they say

* Ask them what they would prefer, and keep on asking

* Answer Every Question openly and fully

* Ensure that all your agreements are totally clear

* Be unfailingly courteous in everything you do

3 Build Partnerships

* If you have a problem that might affect them, tell them first

* Share your (relevant) problems with them

* Ask for their advice, enlist their assistance

* Ask about their successes, tell them about yours

* Encourage them to talk to each other

* Offer to help them with their problems, where you can succeed

4 Give Them Pleasant Surprises

* Increase your Product Quality, but not the Price

* If you can give them a better Price, do it before they ask

* If you can deliver faster, offer it before they ask

* Provide some, or all, minor services Free of Charge

* If you think they can use your Product better, offer to help

* If they have any complaint, over react generously with a solution

If you Keep your Promises, Communicate, and Build Partnerships......

.......You will be seen as just another Good Supplier

This is only the Absolute Minimum necessary not to be seen as a Bad Supplier

To be seen as Different,

to earn Loyalty,

to create Ownership of You and Your Product/s,

......to Recruit your Customer to be Your Salesman

Give Your Customers Pleasant Surprises

So, there it is. Look how easy it has been for Bosch to hire me to sell for them.

And last time I told you how a service failure by a car dealer escalated into a big issue for me, and for them. They reacted well, eventually, gave me a very pleasant surprise and left everything sorted, this time. However, although they have for so long been the top brand for Quality, too many flakes fell off their egg shell of perfection, and the view inside looked too empty for comfort. I wonder, is all as well as it should be in the world of Toyota?

We regularly remind all that the true differentiator of business performance lies in the attitudes, values, behaviours and beliefs of the people in the business. It is these that fill the precarious egg shell of Excellence and bind it all together. If they are not managed well, then the shell will be empty and fragile and the business vulnerable. As the Bosch engineer demonstrated, any one of your people can become your Customer Heroes – worth more than any sales force on earth.

The Cost of Behaviour is brought to you by Steve Goodman, Tony Ericson, Terry Murphy and Barbara Craven, the founding partners of Achievement Coaching International where we help businesses to learn different thinking to enable different actions that deliver the different resultsthat Make the Big Differences that Transform Results.

This series looks at the corrosive and far reaching effects for business profitability, and even survival, of failures in behaviour. It challenges all those that believe in “don’t rock the boat”.

You might also be interested in our "Excellence Quartet" of blogs promoting the cause of Excellence as the key to prosperity. We publish regular articles using a recent business/financial topic to highlight different perspectives and conclusions to those obtained by conventional thinking and techniques. You can read the other four blogs at our web site link page.

Careless can Kill Your Reputation

When you look at the Cost of Behaviour it is surprising that so few business managements seem to understand the massive difference between the “problem” and “the consequences” when it comes to their market, product and service reputation. It is amazing how one little bit of “careless” can multiply itself into a major customer relationship problem, and even to a reputational threat. I have just experienced it.

So many organisations continue to believe that Customer Satisfaction is demonstrated by the absence of complaints, or by the use of glib and biased questionnaires (true, I’ve seen ratings offered from “Satisfactory” to “Excellent”), by the deflection of all questions (good or bad) into so called “Customer Service” departments or, what seems to be the standard NHS approach, by outright denial followed by legal obfuscation and cover up. Of course Renault (Clio bonnet catch) and BMW Mini (engine bay fires) also tried this approach, until eventually, they were found out – what has it cost them in sales? Then there are those that believe that if you shout “We Are the Best” loud enough and long enough, people might believe it; British Airways proved that didn’t work. Then there is the Ryanair approach.

We are positive that there are people in these organisations, almost without exception, who have analysed down to hundredths of a penny, the financial cost of putting the matter right – and not one who has evaluated the sales potential of a solution that makes customers happy – the “bean counter” attitude rules. And, watch this space, as we have predicted in our other blogs, Kraft are busy squeezing Cadbury’s quality down the same pathway to doom.

There are outstanding exceptions. One major parcels service targets its loyal customers, including all relevant employees who come into contact with them or their systems, with “What Can We Do Better” surveys; they invite their customers’, who know them inside out, into their own continuous micro-improvement processes. It is no surprise that they are going from strength to strength even in these difficult times. Currently Bosch Service Engineers are visiting thousands of homes to replace, free of charge, electronic controllers (discovered to have a low probability safety hazard) in dishwashers that can be up to 12 years old and, because of the way in which it is being done, giving customers a totally seamless and excellent service experience – it will sell more Bosch Home Goods.

We repeat that it is the attitudes, behaviours and beliefs of a business leadership and management that determine the performance of the organisation. And one of the quickest and sharpest ways to gain insight into the quality of these attitudes, behaviours and beliefs is to look at how they deal with their customers.

I have just been reminded of something I wrote for a client 20 years ago

Every time you get something WRONG, and your Customer finds out about it before you do,

then you have made your Customer become...Your Quality Manager

1 Your Customer did not volunteer for the job - Your Customer thinks it is your job

2 The facts do not matter - only what Your Customer Thinks

3 Your Customer expects to be "paid" for doing your job

4 Your Customer expects to be treated courteously and promptly

5 Delay damages Credibility - the longer you take to tell him "your truth", the more chance Your Customer will believe someone else's, and the less likely Your Customer will trust you

6 If you delay too long, then no one will believe you whatever the virtue of your case -there is no justice

7 If you do not deliberately engage the Good Will of your Customer - then you have volunteered to be given his Bad Will, or even to be offered Vengeance

8 The "better", or more long standing, the Customer, the greater the chance that getting it wrong will bring more trouble to you rather than less

So:- It is BEST not to get anything Wrong

but....

If you cannot get it Right - at least - Handle it Right with the Customer

OR GIVE UP YOUR CUSTOMERS (and close the business)

BEFORE THEY GIVE YOU UP!

What reminded me of all this?

I have just bought a used car from a franchise dealership of a brand that I trust utterly, even admire. To my surprise it has not been a good experience and it became a bad one. Was it a Big Problem? Not at the start, just some missing but important documents. After an increasingly stressful month of non-performance and responsibility dodging , I was beginning to think that the whole dealership was rotten from top to bottom. I had totally lost confidence in them and, for the first time in over 20 years, the brand. Multiply that a few hundred times and you are set to repeat the whole BMC, Leyland, Rover tragedy.

It took one competent person 24 hours to solve my initial problem, and to start to restore my confidence in the dealership. I suspect that the carelessness of only one person was enough to create, and then fuel, the whole situation and my Bad Experience – attitude, behaviour and beliefs?

However, I have been through all the steps from 1 to 8, so what the dealership’s management do next will determine how I feel about them and the brand.

In our next post we will talk about how to recruit your best, your largest and your cheapest sales force.

The Cost of Behaviour is brought to you by Steve Goodman, Tony Ericson, Terry Murphy and Barbara Craven, the founding partners of Achievement Coaching International where we help businesses to learn different thinking to enable different actions that deliver the different resultsthat Make the Big Differences that Transform Results.

This series looks at the corrosive and far reaching effects for business profitability, and even survival, of failures in behaviour. It challenges all those that believe in “don’t rock the boat”.

You might also be interested in our "Excellence Quartet" of blogs promoting the cause of Excellence as the key to prosperity. We publish regular articles using a recent business/financial topic to highlight different perspectives and conclusions to those obtained by conventional thinking and techniques. You can read the other four blogs at our web site link page.

It's not Mother Natures fault!

Business Breakthrough Coach RobinTones has been drawing peoples’ attention to some interesting research. UCL researcher Dr. Tali Sharot has conducted experiments which show that 80% of us are genetically programmed to be optimistic. The study showed that under an MRI scan, not only did the optimists not take adverse information to be relevant to themselves, but that their brains did not even process the information.

The research implication is that even if you try on your own to be “realistic” your own brain is working against you. In other words, you don’t “consciously deny” bad news, threats or hazards – you simply just do not recognise them. However, the use of the word “optimistic” then implies this is a matter of your personal attitude. We are certain that this really is not helpful.

We guess if we were all hard wired to be pessimistic (e.g. Marvin the robot in Hitchhikers Guide to the Galaxy) the human race would have died out years ago as we would have concluded it wasn't worth getting out of bed! So we view this study and many others that are similar as an exercise in the bleeding obvious. This is not to do with whether the findings are right or wrong, but - are they any use?

We have long argued that if managers manage on the basis that it is equally likely that things will go wrong rather than go right, they will find that most things go right. Even when things go wrong these "Forward Facing Managers" as we call them become mentally attuned to quickly fixing the problems and then using the learning to stop them reoccurring.

When experts label these things as optimism/pessimism this infers that the problem is a mental attitude (of course it is "your mental attitude" that is the problem not mine!) Consequently these psychological studies may be interesting but are of little use in providing practical answers to the practical problems we all face in our work and life in general.

The man who ran around that Italian cruise liner shouting "there you are, told you this would happen" would not have been popular or helpful at the time. What would have been helpful was lifeboat and evacuation drill and coherent situational leadership, starting with the captain. What would have helped before the event was sticking to the course that for very good reason had been programmed into the ship's navigation systems.

So what do Forward Facing Managers do that is not about whether they are naturally optimistic or pessimistic? They deal with "realistic" and use a management process to do this. The Achievement Process is a "process for managing" that does not have to go near mental attitudes. It provides a simple, yet comprehensive process for getting more things right first time more often AND enables individuals to connect to the process and manage their own behaviour differently to get different, better results - fast. It is the only tool available from anyone anywhere that can do this.

However, as Robin Tones so rightly is pointing out to his audiences, you may need help to step outside your “genetically pre-conditioned” reactions. Even without the UCL research, this is a human behaviour commonly seen whenever any individual’s current reality is under threat (today’s news about the nurses and midwifes in the NHS, for example?).

It does not need labelling, it needs to be dealt with - that is why we think two things are essential

1. A robust way of thinking about how to get things done that is free from attitudinal and judgemental distractions
2. An independent person with whom to discuss situations and to help you apply your process based thinking.

This is a key element in what we do.

The Cost of Behaviour is brought to you by Steve Goodman, Tony Ericson, Terry Murphy and Barbara Craven, the founding partners of Achievement Coaching International where we help businesses to learn different thinking to enable different actions that deliver the different resultsthat Make the Big Differences that Transform Results.

This series looks at the corrosive and far reaching effects for business profitability, and even survival, of failures in behaviour. It challenges all those that believe in “don’t rock the boat”.

You might also be interested in our "Excellence Quartet" of blogs promoting the cause of Excellence as the key to prosperity. We publish regular articles using a recent business/financial topic to highlight different perspectives and conclusions to those obtained by conventional thinking and techniques. You can read the other four blogs at our web site link page.

You Don't Believe It?

We repeat -

People and how they think and behave are the only thing that really matters in any business or organisation.

If you ever had any doubts about this - our case is being proved in public!

We thank the RFU for demonstrating so many aspects of this matter so graphically.

We can see Behaviour Failures in 20 out of the 26 criteria of this dimension. This is an organisation that, by the criteria of commercial Comparative Competitive Strength, would be teetering on the brink of The Abyss.

The Cost of Behaviour is brought to you by Steve Goodman, Tony Ericson, Terry Murphy and Barbara Craven, the founding partners of Achievement Coaching International where we help businesses to learn different thinking to enable different actions that deliver the different resultsthat Make the Big Differences that Transform Results.

This series looks at the corrosive and far reaching effects for business profitability, and even survival, of failures in behaviour. It challenges all those that believe in “don’t rock the boat”.

You might also be interested in our "Excellence Quartet" of blogs promoting the cause of Excellence as the key to prosperity. We publish regular articles using a recent business/financial topic to highlight different perspectives and conclusions to those obtained by conventional thinking and techniques. You can read the other four blogs at our web site link page.

When the pie was opened, they all began to sing!

In our last post, we looked at the unfolding drama of the News of the World telephone hacking scandal and how it highlighted the increasing awareness of the business impact of behaviours.

So how does News International, seen through the lens of the news reports, compare against our criteria for the Cost of Behaviour? There are two sets of costs – the “hard” costs, actual outgoings as defined by Crosby, and the “soft” costs, the behaviours that either contributed, or (hidden) have yet to be recognised. We won’t cover all the criteria – just a selection of headlines:-

Direct Costs – these are the ones that Crosby originally identified

Actual Financial Expenses - The massive expenses of closing down NoW.

Consequential Costs

Opportunity Cost - Losing financial control of BSkyB - a huge loss for the Murdoch family

Customer Recovery Cost - Wait and see just how huge this may be

Customer Loss Cost - All those NoW and disgusted Times readers

Compliance Costs

Enforcement Costs - All those lawyers and private detectives – wow! - All those payments and kickbacks coming home to roost. - Jail for some – more to come probably.

Behaviour Costs – may either have contributed to or will add to Direct Costs

Relationship Costs

Conflict Costs - Who is telling the truth? How long will it go on?

Secrecy Costs - How does closing the NoW compare to owning up in 1988? We bet no one looked at this - we suspect that no one dared (see Adduced Behaviour)

Egotism Costs - Surely not? Or did key people think they were above the Law?

Blame Costs - Who will ever trust who again?

Organisation Costs - How many people are currently not doing the jobs the Shareholders think they are paying for? How much talent is heading off elsewhere?

Comprehension Costs

Focusing Costs - What did News International think the problem really was? And when and why did that change? Has it really?

Ignorance Costs - The problem for James Murdoch is that if it isn’t this ...

Incompetence Costs - ........ it will be seen as this

Avoidance Costs - Who, and how many, actively kept their heads down?

“Bottle” Costs - What will all this eventually cost the “whistleblowers”?

Motivation Costs

Energisation Costs - How will the leadership of News International regain the respect and the trust of their key management?

Initiative Costs - Did all this happen just because a small number of individuals “got out of control”? Does anybody think so any more?

Mis-Incentive Costs - How were the people directly concerned being “rewarded” or “recognised”? What effect did this have? And now?

Judgement Costs

Micro-Dumbness Costs - Sending investigators after plaintiff’s lawyers.

Macro-Dumbness Costs - Trying to play the “Deniable Plausibility” game in a ship full of professional leakers.

Stupidity Costs - Simple - doing illegal things.

Adduced Behaviour Costs - How much of all this might have been caused or made worse by reluctance of key executives to tell the Murdoch Family news they thought they would not want to to hear.

Consensus Fallacy - Tom Watson MP’s “Omerta” theory? We think possibly not.

It is clear from even this cursory analysis that although the direct costs have been massive the worst is yet to come when the Costs of Behaviour come to be counted. The big question is how this organisation is going to be able to become effectively functional again after all the damage to relationships, motivation, trust and perception of judgement.

This is a leadership disaster which will require the shareholders to take a long and hard look at the whole top layer of management. How many individuals will be able to demonstrate that they are truly not contaminated by this affair? How many chose carefully not to see or not to hear? How many did not have the courage to challenge what they did see or hear? How many may now be found to have acted as craven courtiers grovelling before the thrones of the powerful?

We do not think the answers will be encouraging – just think back to the aftermath of the last Media Mogul scandal. The challenge for News International will be to transform the quality of internal communications and relationship management starting from the top down. That will take a lot of courage – have they got it – is there anyone left on the bridge to exercise it?

On a broader scale, we think there may be big questions to be asked about the influence and control that majority shareholder individuals should be allowed to have in public companies.

The Cost of Behaviour is a powerful tool to test and challenge the perceived organisational health of a company. In Comparative Competitive Strength terms, News International conducted itself as it saw itself to be, as an Excellent company – they were mistaken. As the tawdry reality has turned out, they had the management and operational culture, the smug arrogance, the undisciplined under achievement of a Comfortable organisation and will now find themselves a Constrained business as the massive costs of this debacle slowly and inexorably roll in. Tragic, avoidable and wasteful.

The Cost of Behaviour is brought to you by Steve Goodman, Tony Ericson, Terry Murphy and Barbara Craven, the founding partners of Achievement Coaching International where we help businesses to learn different thinking to enable different actions that deliver the different resultsthat Make the Big Differences that Transform Results.

This series looks at the corrosive and far reaching effects for business profitability, and even survival, of failures in behaviour. It challenges all those that believe in “don’t rock the boat”.

You might also be interested in our "Excellence Quartet" of blogs promoting the cause of Excellence as the key to prosperity. We publish regular articles using a recent business/financial topic to highlight different perspectives and conclusions to those obtained by conventional thinking and techniques. You can read the other four blogs at our web site link page.