Leadership Catalyst Blog
Be a Leader: “Take the Blame”
All Blog Posts, Change / 26.04.2013
From childhood, most of us try to avoid responsibility for negative outcomes because of the fear of punishment that might accompany it. This thoughtful article suggests that “Contrary to what you may feel in the moment, taking the blame is the power move, strengthening your position, not weakening it.”
Rather than making you vulnerable, taking the blame for something that you are reasonably associated with makes you appear trustworthy and responsible, and changes the mood in the room from pointing fingers to one of constructive problem solving. As a senior leader, taking the blame for things you are remotely connected to in a meeting reinforces a culture of accountability and “no excuses”.
Take a few moments and explore “Why You Should Take the Blame” …..and share it with your team as a tool for tearing down silos between departments.
Read More >>When does telecommuting work well, and how can we make it more effective?
All Blog Posts, Motivation, Vistage Peer Groups / 13.03.20133 comments
The newest occupant of the corner office at Yahoo made a tough and surprising call a couple of weeks ago when she put an end to telecommuting. Despite being new to the company and expecting her first child, Marissa Mayer has evidently taken a hard look at how things work at beleaguered Yahoo and decided the work at home option that so many of her employees had chosen may be more of a problem than a solution. Learn why columnist Anne-Marie Slaughter in her recent article in the Atlantic thinks that Marissa Mayer’s Job is to be CEO, Not Make Life Easier for Working Moms.” This article, unsurprisingly, prompted not a little controversy. (Check out the numerous comments at the end of the article for an interesting discussion.)
Within a couple of days of the Yahoo announcement, Best Buy’s new CEO, Hubert Joly, made the same call by putting an end to the practice of ROWE (Results Only Work Environment) that Best Buy had popularized, and which allowed employees to work at home as long as they were achieving their objectives. The new Best Buy policy does allow for some telecommuting exceptions at management’s discretion.
During my one-to-one coaching sessions with my Vistage CEO Peer Group members, I have found a wide range of opinions on this. Some say this totally validates their distrust of work at home policies. Others recognize that they have scores of geographically distributed people productively working out of their homes, and that centrally locating these people is not feasible or desirable. In either case, telecommuting is probably not going away entirely, and we need to better understand in what situations it works and how we can make it more effective.
That is where you come in. So kind readers, please reply to this post with your comments.
In your experience when has telecommuting worked well? When has it failed? What are some best practices you have put in place to make it better?
I am looking for your brief observations and quick stories of a paragraph or less in length. In a couple of weeks I’ll summarize your answers and add some insights of my own on how to get the most out of telecommuting. Thank you for participating!
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Last week I was in Fort Myers for Spring Training and had a chance to go to a Twins/Red Sox baseball game with my family, including my 2 ½ year old grandson. While the Twins lost, it was still great to get outside and watch the pros work on their game. It was also a reminder that professionals at the top of their game need to continually practice the fundamentals that got them there if they want to stay there.
As a Vistage Chair, my “Spring Training” was at the International Think Big Conference in Dallas last month. I joined 400 other chairs from around the world to practice our fundamentals of running meetings, processing issues, coaching CEOs, and building strong groups with the best of the best. I further refine these fundamentals with fellow chairs in the twin cities at our monthly chair meetings. This continued focus on practicing the fundamentals of great coaching and leading peer group meetings is one of the things that sets Vistage apart from other CEO peer group organizations.
Last week a CEO in one of my peer groups was trying to decide whether he and his partner had lost their ability to bring in business because their revenues were behind plan. They had always been highly successful in the past, and there were plenty of opportunities in the pipeline. Further questioning by the group led to the insight that they were spending a lot of time on opportunities that were outside of their sweet spot. The group helped him better define his target customer so he could focus his sales and marketing efforts there, rather than chasing opportunities that were outside of their core. Finally, they suggested that he and his partner go on a few joint calls to make sure they were executing good sales fundamentals, and had not fallen into some bad habits.
So, when was the last time you went to spring training? Just because you have been in your role a long time does not mean you are doing it better now than you were earlier in your career. Find a mentor, coach, or peer group that can help you periodically practice the fundamentals that have made you good at what you do.
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Our February Vistage speaker, Don Rheem, made a compelling case that CEOs can dramatically improve their business results by being more intentional about their culture. By focusing on employee engagement and creating a place where employees love coming to work every day, CEOs, at little cost, can significantly increase productivity and revenues, enhance customer retention, and reduce employee turnover, absenteeism, sick leave, theft, and accidents. Below are 7 things every CEO should know about employee engagement with links to 3 minute videos of Don making his case for each. These would be great to use in helping your leaders understand why high employee engagement can be such a competitive advantage and what their role is in creating a great place to work.
Video 1: Why should CEOs care about employee engagement?
Don make his case that “There is no other business issue that a company can focus on that will yield a higher return for a lower cost. Nothing else comes close.”
Video 2: Three things CEOs can do to improve employee engagement
Initial action items that create the most value are as follows:
1) Recognition – How often are employees recognized and validated in your company? Feedback needs to be more frequent, more specific, and more timely. This is inexpensive but can have a dramatic impact on engagement.
2) Feedback & Review – Annual reviews are a negative experience for the person giving and the person receiving the feedback. Rheem believes the practice should be eliminated. Employees want feedback more regularly and the time between when they want it and when they get it is far too long if feedback is only given once a year. Feedback should be given on a monthly basis
3) Test & Evaluate – “You can’t manage you don’t measure.” An initial benchmark needs to be established so that improvements in employee engagement can be monitored and leaders held accountable.
Video 3: Dangers of measuring employee engagement:
A survey is a great way to measure employee engagement, but there are a lot of tools out there so it is important to choose a good one. Rheem suggests three things to be cautious of when selecting a survey tool.
1) Measure employee engagement, not employee satisfaction. Employee satisfaction is an outcome of employee engagement, but employee satisfaction is not a leading indicator of employee engagement. Many survey tools that say they address employee engagement actually attempt to measure employee satisfaction. Satisfaction can be attributed to other things besides engagement such as salary and benefits.
2) Try to avoid asking about salary when trying to measure employee engagement. Pay is almost always among the lowest satisfaction items on surveys because employees feel low scores in this area may increase the likelihood of a pay increase. If higher salaries are not an option, don’t ask the question on a survey.
3) Many survey tools are too long. Employees tend to lose interest after 30 questions. Keeping your survey to under 30 questions will still capture key driers of performance
Video 4 : Pending Labor Shortage
In the next few years, the demand for labor will eclipse the supply and employees will be in the driver seat. There are 2 ways the CEO’s can attract and retain talent:
1) Pay higher wages (this can be challenging for CEO’s since labor will typically be the highest item on the income statement when costs rise)
2) Create a culture where people love coming to work. Highly engaged employees are less inclined to leave for higher pay elsewhere.
Video 5: Key Factors in Employee Engagement
When measuring employee engagement, a 4 point measurement scale can be highly effective: actively engaged, somewhat engaged, somewhat disengaged, actively disengaged. There are also 3 other things that employees need to feel engaged and the confluence of these three things is the sweet spot of engagement:
1) Focus- employees need to know the companies goals and their role in accomplishing these goals. A “clear line of site” on what needs to be done is important
2) Capabilities – employees need to be given the tools, resources, and training needed to accomplish company goals in order for them to care
3) Will – your employees’ desire to do their job (discretionary effort) is critical.
Employees need all 3 of these to feel engaged and these criteria are measurable.
Video 6: The Biggest mistake that CEOs are making
The largest mistake that CEOs are making in regards to employee engagement is a lack of understanding on what truly drives human behavior in the workplace. Money is not the answer. Intrinsic motivation is something that can only be volunteered by employees, not demanded. Company culture and managers are the ways to unlock intrinsic motivation. Culture includes elements such as core values, mission, vision, and corporate social responsibility. The simplest definition of company culture is “What does it feel like to work here.” The behavior of your leaders must be congruent with the company culture, they are the key to creating or destroying your culture – employees hire join a company, but they quit their manager. Toxic managers cannot be tolerated.
Video 7: The annual review is dead- what can CEOs do about it?
What do you replace the annual review with if it is dead? First you need to separate the notion of giving a raise with performance reviews. You can still pay for performance, just don’t make the salary discussion the primary place where performance feedback and coaching takes place. This makes performance reviews safer for employees and allows more honest communication. Best practice for reviews is to conduct them monthly. Every employee should have an individualized action plan that they have developed with their manager to help them achieve goals that are important to them. This will increase their sense of autonomy and empowerment which will increase their level of engagement.
Monthly action plan reviews do not need to take more than 15-30 minutes. The manager should begin the meeting by asking the employee how they did on their action plan in the last 3 days. After listening the employee, the manager can offer course corrections, delete items that were accomplished, and add new items. The action plan is very much a living document, and the manager takes on the role of a coach. In the last 5 minutes of the monthly review, the manager should ask “what do you need from me in the next month? What can I do to help you make progress on your plan?”
Building and Sustaining a High Performance Culture
Dramatically changing your culture around employee engagement takes 12 – 18 months. To make rapid and sustained improvement, hire a consulting firms like Don’s to help you measure engagement and train your leaders to improve it. Here are the steps Don recommends.
1) Measure employee engagement (not job satisfaction) annually at the work-group level and then give each work group leader and their team specific feedback on what is working and what could be improved. Hold them accountable for developing and implement action plans to improve it in their groups.
2) Train your leaders (1-2 days) on how to foster engagement and how to change the behaviors and habits that can squash it. Clearly communicate to managers and employees what engaged vs. disengaged behaviors look like.
3) Provide additional coaching to key leaders, and focus on moving employees in the middle from “disengaged” to “engaged.” Employees and leaders who are “actively disengaged” and especially toxic managers who are resistant to change need to be terminated.
4) Hire based on fit with your high engagement/high performance culture, and on-board new employees with a mentor other than their boss.
5) Clearly communicate your vision and core values and recognize people who are living up to them.
6) Replace the annual performance/salary review with 15 minute monthly employee action plan updates and feedback sessions.
7) Continue the employee engagement and feedback process annually to measure progress and foster continuous improvement and accountability.
For more information, go to engagient.com
Read More >>Is Passion Over-rated???
All Blog Posts, Motivation / 20.02.2013
Last month Daniel Pink joined one of my Vistage Groups at lunch while we were attending the Vistage International Think Big Conference in Dallas. His book entitled “Drive” on intrinsic motivation was the subject of one of my early blog posts a couple of years ago, and I have been an admirer of his work ever since. We enjoyed chatting with him about what it takes to be a successful author, and how he transitioned to that role from a highly successful career in politics.
Career transition is on the minds of a few of the CEOs in my group as they think about what they would like to do next. As the CEOs of their companies, they have a lot of options–do they continue to grow the business in their current role? Do they hire someone to run it for them, and focus on new product development or other activities that they really love? Do they sell the company and start a new one? Or do they retire?
Daniel Pink talked with us about how he decided to become a writer. He continuously heard from others that he should just follow his passion. The problem was, he couldn’t really identify anything he could say he was passionate about. After casting about for quite a while, his wife suggested that rather than look for his passion, he should just focus on what he does and how he spends his time. As he thought about, he had always been a writer. Before being the lead speech writer for President Clinton, he was always writing articles, whether it was for the high school or university newspapers, trade publications or associations. No matter his workloads or deadlines for his day jobs, he always found time to complete his volunteer assignments on time, even if it meant doing them after midnight the night before a packed agenda.
And so, he decided to become a writer. He said that writing a book takes him about two years — one for research and one to write the book. It is hard and frustrating work, especially when you have a goal of 60,000 words, you spend all day writing 600 words, realize it’s crap, tear it up, and start over. When he is in the middle of writing a book, he would seldom say that writing is his passion, but it is what he does.
So next time you are helping someone think about their next life chapter, don’t just ask them about their passion–ask them what they do.
Read More >>Vistage member recognized for his commitment to developing his people
All Blog Posts, Motivation, Talent Management / 07.02.2013
Too many entrepreneurs hit a growth ceiling because they fail to build a strong leadership team beneath them. Vistage members know that to grow their business, they need to grow their people and themselves. Michael Lacey, CEO of Digineer, is featured in the February 2013 issue of Minnesota Business for the development of his leaders and his people.
The article features 3 examples of how investing in executive education has produced mutually beneficial results for the employees and their companies across various industries. The article highlights Michael’s support of Digineer manager Erin Wright in her participation in the Minnesota High Tech Association (MHTA) ACE Leadership program.
A significant financial and time commitment were involved in completing the ACE Leadership Program and both Michael and Erin are seeing the positive impact of Digineer’s investment. Michael’s commitment to developing his people extends beyond just the leadership team. “Lacey makes sure Digineer employees have the time they need to learn and experience in both formal and informal environments. In fact, most of the 125 Digineer employees have been or are currently involved in a variety of continuing education programs.”
What a great model to aspire to – congratulations Michael, and thank you for setting a high bar for all of us.
Read More >>Stop Multitasking and Get More Done!
All Blog Posts, Motivation / 30.01.2013
Busy executives often pride themselves with their ability to multi-task, believing they are getting far more done than if they were simply completing one task at a time. Last week there was an interesting article by Paula Bilitz in the Minneapolis Star Tribune (Click here) suggesting that Multitasking is just Switchtasking. In it she cites compelling Neurological evidence that the brain cannot effectively do two things at once. In fact, it is less efficient than doing one thing at a time, because switching costs result when people need to review what they have done before resuming work.
It is also just plain rude. As author Dave Crenshaw points out in his book The Myth of Multitasking: How Doing it All Gets Nothing Done, “Multitasking is a polite way of telling someone ‘I haven’t heard a word you’ve said.’”
One of the ground rules we use in our Vistage Executive Peer Advisory Meetings is something we call the “Airplane Rule”. During the meeting, all cell phones and email devices are switched off. We allow time for email and phone calls during breaks, but during the meeting time we want everybody to be fully present and engaged. I find our meetings are incredibly more productive than ones I frequently experienced in the corporate world. Try turning off your phone at your next meeting.
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Focusing on Core Values Helps Vistage Member Win 2013 Specialty Retailer of the Year Award
All Blog Posts, Vistage Peer Groups / 21.01.2013
Last week I attended the 2013 Twin Cities Business award banquet for the most successful small businesses in Minnesota. I was honored to have been invited as a trusted advisor by one of the honorees, Bob Hartzell, of Chuck and Don’s Pet Food Outlet. Bob is a Charter member of one of my Vistage CEO Peer Advisory Groups, and I am proud to have him in our group. It was fun to hear how they had leveraged an initial $250 investment in one store 22 years ago, into a thriving and fast growing chain of 24 stores in Minnesota and Colorado. (Click here to read their brief success story.)
But it was even more gratifying to hear Bob’s partner, Chuck Anderson, attribute much of their success to having clearly articulated core values to guide their decisions and mold their culture. Everyone talks about values, but few know how to use them to run their business. This is something my Vistage members have focused on, and Chuck presented several examples in his acceptance speech of how it has helped fuel their success.
The three core values he highlighted were a “passion for pets,” “customers first,” and “commitment to community.” These are not just words on a website or a banner — they are core values around which they make business and hiring decisions. Here is how.
- Passion for Pets – Everyone who works at Chuck and Don’s loves animals, and over 90% of them have pets of their own. Their business cards have pictures of their own pets on them. Customers are encouraged to bring their pets into the stores and their employees know many of them by name. I have heard customers say that employees know their pets better than they do, and that they are incredibly helpful not only in helping them buy the right products, but also in solving their pets’ training or behavioral issues.
- Customers First – Employees are encouraged to spend as much time with each customer as needed to help find solutions to their problems. They log customer purchases at the cash register so that they can help other family members of the customer pick out the type of food their pet typically eats. Employees even carry out heavy bags of dog food to the car for their customers. Chuck and Don’s has a remarkable customer loyalty program that rewards their best customers with the greatest savings.
- Commitment to Community – Chuck and Don’s is an active sponsor of service dog and rescue organizations, donating over $150,000 per year. Their policy to encourage pet adoption and not sell pets in their stores is another example of their commitment to the rescue community. They also look for store locations in areas that have a strong sense of community, and I have seen them pass on high traffic locations that they felt lacked a community connection.
Congratulations Bob, on being selected as one of the most successful small businesses in Minnesota and thank you for providing such a great example of how use core values to align your organization and grow your business.
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Our successes and failures seem to be grounded in habits we were lucky enough to make or are too weak to break. Just what are habits, how do they work, and how can we break bad ones and make good ones? Many of the CEOs in my Vistage Peer Advisory Groups are trying to improve their health by changing their habits. As it turns out, the secret to changing habits has huge implications, not only in our personal lives, but in our businesses and in society at large.
For some answers, check out a wonderful new book, “The Power of Habit: Why We Do What We Do in Life and Business.” You can also check this CNN Video interview (5 min) with the author and Fareed Zakaria and some brief explanations by the author of what you’ll find in the book, including how the CEO of Alcoa turned the company around by changing the safety habits (no kidding) of its employees and how Target can tell which of their customers are pregnant. In another video, (3 min) the author explains the habit breaking technique in detail. If you are really interested in changing your habits, take 8 minutes to view both of these videos.
I’m about two thirds of the way through the book which looks at role habits play in individuals, companies and society as a whole. One of my favorite stories relates how a US Army officer analyzed the habit of crowds in an Iranian town and significantly reduced the number of riots there by removing the kebab vendors (again, no kidding). Stay tuned to see if his techniques are powerful enough to help me exercise every morning and stop snacking at night.
Ten Game Changing Tips for CEO Personal Productivity
All Blog Posts, Motivation, Vistage Peer Groups / 31.05.20121 comments
As members in my CEO peer groups have been getting a grip on their business through the implementation of “Traction”, a new challenge has emerged – How to make the best use of time that was previously spent in countless meetings and in constantly fighting fires. In other words, how do they more effectively use their found time to work “ON” their business rather than “IN” their business.
Last week we had Steve McClatchy, CEO of Alleer, help us do just that. Most of us had been through various time management programs, and understood the “importance vs urgency” distinction when prioritizing tasks.
However, all too often, urgency trumps importance, and deadlines tend to dictate how we spend our time. This keeps us in a reactive, rather than a proactive mode, which means most of our time is spent managing or maintaining our businesses, rather than leading and improving our businesses.
Here are 10 game changing tips from Steve McClatchy:
1. There are two major categories of tasks — Gain Tasks ( “A” priorities) and Prevent Pain Tasks (“B” & “C” priorities).
“Gain Tasks” produce the greatest results in terms of achieving your goals and improving your life or business. They are things you really want to do, they are motivating, and accomplishing them is energizing and creates the feeling of balance in your life. However, you don’t have to do them, you can’t delegate them, and they are never urgent. These should be your “A” priorities. The only person that can place an “A” on your task list is you. Everyone else’s “A”s are your “B”s and “C”s
“Prevent Pain” tasks are things we “have to” do, and are maintenance tasks which keep us where we are. They will eventually all become urgent, and can burn us out. Prevent Pain tasks are “B” priorities if their results are being recorded and “C” priorities if no one else will know if we completed them or not. Delegate “have to” tasks whenever possible.
2. Intersperse your “A” tasks with your “B” and “C” tasks throughout the day.
This will help you accomplish your “A”s, energize you to accomplish your “B” and “C” tasks, and will create the feeling of balance and movement toward your goals. If you do your Prevent Pain tasks first, you will never get to your Gain tasks and will experience burnout.
3. Schedule your “A” tasks on your calendar to assure they get done.
People make decisions on how to use their time, based on their calendar, not their task list! Getting your “Gain”tasks on your calendar dramatically increases the probability that you will complete them.
4. Have one location to record all of your tasks, appointments, contacts notes and emails.
Keep it with you always, on your smartphone, tablet or PC, and get rid of all floating pieces of paper. For each task or email, touch it only once and decide to :
— Do it now if it takes less than 2 minutes
— Do it later and schedule it on your calendar or to do list.
— Don’t do it ever.
— Delegate it
5. Create daily and future to do lists using tasks in outlook, lotus notes, etc. by entering the date the task is to be started and when it is due.
This is the key to delegation, goal achievement, and stress reduction. Don’t overwhelm yourself and kill your productivity with one giant to-do list. By using an outlook task list, you can parse your master to do list into 365 daily to do lists (one for every day of the year) by simply putting in a start and completion date. Don’t waste time looking at tasks you are not going to get to today. For more ideas, go to: http://www.alleer.com/Article-TMTip1.htm
6. Keep ONE calendar!
You can still keep communication calendars (like work and home), but everything on a communication calendar needs to be on your calendar. You will save yourself an unbelievable amount of time and aggravation if you and your spouse can access one another’s calendars through outlook, google or iCalendar. Make sure everything syncs through the cloud. If you have non-compatible devices (PC/Apple) and don’t have an exchange server, you can “rent” one over the cloud for about $6/month at sherweb.com.
7. Keep great notes!
For a low tech option, keep one spiral notebook that you log all notes chronologically by date.
Tablet computers are ideal for this purpose. The main challenge is retrieval, so keep it simple and take notes where you can always quickly find them. For example, create an outlook contact for each of your employees, and keep a running journal on all of your conversations in the notes section of each contact. You can also record performance examples there, along with topics you want to cover the next time you talk. Do the same for all of your peers, boss, customers, and even your kids.
There are also applications like onenote, evernote, and notes that let you take notes by date, topic and contact. The advantage with these applications is that they sync with all of your devices so that they are always accessible.
8. Become a power user of Outlook, Lotus notes, or Apple apps.
Learn to drag emails into tasks, calendar and contacts so that you have that information when you need it — When you are working on it or when you are in a meeting. You can also drag tasks into your calendar so you can easily schedule them
Turn your standard emails and templates into “signatures”. You can have over 75 different signatures that contain full emails. The advantage is that when you need to send a standard email, you can click on “new” and then right click anywhere on the signature, which will generate a drop down box with all of your signatures. Click on the one you want, change the salutation and anything else you want to customize, and then hit send.
9. Implement email protocols and best practices.
Email, while a great tool, can be an incredible personal and organizational waste of time. When you calculate all of the time it takes to set up, address, write, and edit an email, most people are only communicating at 5 – 10 words per minute. Contrast this with texting, which is 10 – 20 words per minute, Instant messaging, which is 30 – 40 words per minute, and voice mail, which is 150 – 250 words per minute.
Huge amounts of time can also be saved by having people limit their distributions lists and by not hitting “reply all” on their responses.
Finally, make sure you are managing your email, and not letting it manage you. Turn off your email new item alert window and sound — You have enough interruptions. Check it a couple of times a day, and otherwise, stay focused on accomplishing your “Gain” tasks for the day.
10. Manage interruptions to stay productive and accomplish your “Gain” tasks.
The key, says McClatchy, is to limit the interruption to the 2 minutes of actual work required by the interruption, which usually falls into 3 categories: A task someone wants you to complete, an appointment they want you to schedule, or an exchange of information. For some great tips on how to do this directly and in a way that builds rather than hurts relationships, go to Managing Interruptions.
Read More >>In the 18-minute Ted Video below, Simon Sinek presents a compelling argument that great leaders inspire action in their followers by starting with the “Why” before talking about the “How” or “What”. He illustrates his points using the inspirational examples of Apple Computer, the Wright brothers, and Martin Luther King Jr.
If you haven’t already seen it, I recommend you take 30 minutes to watch the video and then draft a “Why” statement for both your company and yourself. It is well worth the time, and one of the better TED videos that I have seen. It could significantly change your approach in communicating to employees and customers.
[youtube=http://www.youtube.com/watch?v=qp0HIF3SfI4&w=640&h=360]
Sinek says that people don’t buy what you do, they buy why you do it. A key to success as a leader is attracting followers who share your beliefs. When inspiring others to follow you or buy your product, start with “Why”.
In our March Vistage meetings, we watched and discussed this video, and all members (including me) took a stab at drafting a why statement for their businesses, and for themselves.
Here is my take on the Vistage Why, How and What statements.
Why: Vistage is dedicated to increasing the effectiveness and enhancing the lives of Chief Executives.
How: We accomplish this by helping Chief Executives become better leaders, make better decisions, and get better results.
What: We build and sustain Executive Peer Advisory Groups of chief executives from non-competing business to deliver 4 pillars of value.
- Confidential “Advisory” Peer Group Meetings that meet monthly to address key issues impacting executive decision-making and corporations;
- Private 1-to-1 Mentoring/Coaching Sessions monthly between the Vistage Chair and member executive;
- Expert resources (e.g. speakers, coaches, and “been there done that” CEOs that visit the group meetings regularly)
- Exclusive Content and On-line Connectivity to all 15,000 members and resources developed and improved for over 50 years on the proprietary Vistage Village website.
The next step is to articulate your own “Why” statement, which is more personal, and therefore, more difficult. People often ask me why I became a Vistage chair, having led a large global consulting business for many years.
The reason I became a Vistage Chair is to fulfill my core life purpose, which is to use my gifts, to do what matters, with people who care. Building, sustaining, and belonging to a community of leaders who are committed to one another’s business and personal success is more fulfilling than anything else I can imagine.
So what is your personal “Why” statement? We are looking to add a few more advisory board members that believe what we believe. If you would like to learn more about what it means to belong to an executive peer group that is committed to helping one another grow their businesses, their people, and themselves, call me at 612.877.1234.
Read More >>Some economic humor…And some serious Vistage economic predictions
All Blog Posts, Vistage Peer Groups / 13.03.2012
As election year heats up, we keep hearing conflicting reports about the labor market’s gains from the economic recovery. At times, the arguments are reminiscent of the “Who’s on First” routine that Abbot and Costello were so famous for. Here is some of that same logic to help us understand how the number of people without jobs is going up while the unemployment rate is going down.
COSTELLO: I want to talk about the unemployment rate in America.
ABBOTT: Good Subject. Terrible times. It’s 9%.
COSTELLO: That many people are out of work?
ABBOTT: No, that’s 16%.
COSTELLO: You just said 9%.
ABBOTT: 9% Unemployed.
COSTELLO: Right 9% out of work.
ABBOTT: No, that’s 16%.
COSTELLO: Okay, so it’s 16% unemployed.
ABBOTT: No, that’s 9%…
COSTELLO: Wait a minute. Is it 9% or 16%?
ABBOTT: 9% are unemployed. 16% are out of work.
COSTELLO: If you are out of work, you are unemployed.
ABBOTT: No, you can’t count the “Out of Work” as the unemployed. You
have to look for work to be unemployed.
COSTELLO: BUT THEY ARE OUT OF WORK!
ABBOTT: No, you miss my point.
COSTELLO: What point?
ABBOTT: Someone who doesn’t look for work, can’t be counted with
those who look for work. It wouldn’t be fair.
COSTELLO: To whom?
ABBOTT: The unemployed.
COSTELLO: But they are ALL out of work.
ABBOTT: No, the unemployed are actively looking for work. Those who
are out of work stopped looking. They gave up. And, if you give up,
you are no longer in the ranks of the unemployed.
COSTELLO: So if you’re off the unemployment rolls, that would count
as less unemployment?
ABBOTT: Unemployment would go down. Absolutely!
COSTELLO: The unemployment just goes down because you don’t look for work?
ABBOTT: Absolutely it goes down. That’s how you get to 9%.
Otherwise it would be 16%. You don’t want to read about 16%
unemployment do ya?
COSTELLO: That would be frightening.
ABBOTT: Absolutely.
COSTELLO: Wait, I got a question for you. That means they’re two
ways to bring down the unemployment number?
ABBOTT: Two ways is correct.
COSTELLO: Unemployment can go down if someone gets a job?
ABBOTT: Correct.
COSTELLO: And unemployment can also go down if you stop looking for a job?
ABBOTT: Bingo.
COSTELLO: So there are two ways to bring unemployment down, and the
easier of the two is to just stop looking for work.
ABBOTT: Now you’re thinking like an economist.
COSTELLO: I don’t even know what I just said!
And now you know why unemployment figures are improving!
For a more serious treatment of the issue, watch this 8 minute video by Brian Westbury, chief economist at First Trust.
[youtube=http://www.youtube.com/watch?v=fS_LpEs-4Uo&w=480&h=360]
Brian points out that over the last several decades, the official unemployment rate, (currently 8.3 %) is almost perfectly correlated with the jobless rate (aka The U-6 Index) which is currently 15%. Mathematically, the U-6 index is consistently 1.8 times the official unemployment number, and since that ratio has not changed, the gap between the two is not increasing because more people have simply stopped looking for a job. He does suggest that the gap may widen with the aging of our population as the percentage of people over age 60 who want to remain increases.
While we can debate how to best measure unemployment, a couple of facts are evident:
1. The U.S. added more than 200,000 jobs for the third consecutive month. (WSJ – 3/10/2012)
2. This job growth was predicted by the Vistage Q4 2011 CEO Confidence Index at the end of last year. Here is a quick summary of those results.
Vistage members were not only more optimistic about prospects for the national economy, but also about the outlook for their own firm’s performance during the year ahead. The Vistage CEO Confidence Index was 98.8 in the fourth quarter 2011 survey, up from 83.5 in the third quarter and reaching the highest level since the start of 2011 (105.2).
Below are some key highlights from the Q4 Vistage CEO Confidence Index:
- 41% of CEOs recognized improved economic conditions over the previous 12 months, up from just 18% in the Q3 survey.
- Only 12% of CEOs thought the economy had recently worsened.
- 73% of CEOs expected revenue growth.
- 55% of CEOs said they plan to increase the number of their employees over the next 12 months, compared with 46% in the Q3 survey.
- 43% of CEOs said the European debt crisis impacts their business.
- 24% of CEOs are finding it easier to obtain credit for their business today compared to 6 months ago.
- 49% of CEOs believe Mitt Romney will emerge as the Republican Presidential Nominee for 2012, while 29% believe it will be Newt Gingrich.
The Vistage CEO index has become a very reliable and accurate predictor for the economy and job growth 2 quarters out. Having these insights into the future provides a competitive advantage to Vistage member companies, and is one of the many reasons that they consistently outperform their non-member peers.
The Q1 2012 CEO confidence index is currently being compiled, and I will post an update in early April
Read More >>CEOs in my Vistage Peer Group candidly reveal the impact the group has had on their businesses
All Blog Posts, Vistage Peer Groups / 13.02.2012
A little over a year ago, I submitted a post citing research that Vistage CEOs outperformed their non-member peers. (http://theleadershipcatalyst.wordpress.com/2010/10/31/research-backs-claims-that-vistage-ceos-outperform-their-nonmember-peers). The bottom line of that article was that
“… in one of the toughest economies in history, Vistage member companies averaged 5.8 % revenue growth, while nonmembers averaged a (9.2%) revenue decline. In future posts, we will explore the factors that contribute to that sizeable performance difference.”
The purpose of today’s post is to make good on that promise. Most of the CEOs who have been in the Vistage Peer Group that I chair have seen significant improvements in their business since they joined. Our group currently has 18 members from a diverse set of industries and backgrounds and businesses that range in size from $5M to over $800M in annual revenues. To better understand how belonging to Vistage increased their effectiveness and enhanced their lives, I took a little flip camera to one of our monthly executive coaching sessions and asked them. (To see all 12 videos, click on the CEO VIDEOS tab at the top of the page.)
For purposes of this blog post, I selected the responses of 3 CEOs from varying company sizes, industries, and business models. Some were struggling a year ago, and others were doing well. All are doing better now and point to their Vistage membership as a key factor in their successes. Below is a brief outline of their situations and links to their 2 minute YouTube videos where they share how Vistage made a difference.
Gene Earhart is the CEO of Wellington Security Systems, a small family business (< $5M) he owns and operates in partnership with his brother-in-law. Gene is a lifelong entrepreneur, who decided to start this business with his family before finishing college. His company designs, installs, and services electronic security systems for the commercial market, and they have 10 employees in a single location. He credits Vistage with helping him turnaround his company to achieve the most profitable year in their 30-year history.
Click here to see a 2 minute YouTube video of Gene telling his story.
Mike Martin is the CEO and owner of Carlson & Stewart Refrigeration ($10 – $25M), which designs, installs, and services industrial and commercial refrigeration systems. An engineer by training, he has worked most of his career at his company, and bought it and became CEO about 8 years ago. Based in Marshall MN, he has about 50 employees in 3 locations in Minnesota and South Dakota. He says that he would not have been able to double the size of his business last year without Vistage.
See Mike’s 2 minute YouTube video by clicking here.
Jim Fisher is the CEO of Midwest Sign, a privately owned business ($100M+) that distributes sign making equipment and supplies. They have about 200 employees in 9 locations throughout the western half of the U.S.. Jim is trained as an accountant, and has spent most of his Career with Midwest. He was thrust into the CEO position about 5 years ago with the sudden and unexpected death of the beloved company owner and founder. After being pounded by the recession, he and his team have hit the restart button on their growth engine, and last year they achieved double-digit growth and record profitability. He points to Vistage as helping him become more strategic, getting him more on top of the business, and showing him how to get a lot more done in less time.
Click here to see more about how Vistage has helped Jim elevate his game as a CEO.
A key theme that cuts across all of these stories is that “None of us is as smart as all of us”. Having an advisory board of fellow CEOs that have your back and challenge your thinking is a tremendous competitive advantage.
Read More >>How to Increase Accountability
All Blog Posts, Coaching, Performance Management, Vistage Peer Groups / 22.11.20111 comments
In a recent Vistage meeting, a theme that emerged was how to better hold others accountable. People often agree in meetings to things with “their fingers crossed”, and don’t deliver on commitments. While this is the subject of many books and training programs, one quick fix is to assure that you have a “Level 5” agreement.
James Newton, CEO of Newton Learning corporation and longtime Vistage Speaker, outlines 5 levels of agreement. Below is a brief description of each agreement level, illustrated by a simple example of setting up a golf game. As you read the scenarios, consider the level of agreement you have achieved in those instances where people have not delivered on commitments.
Level 1 Agreement: No agreement at all.
Brian: “Hey Mike, what do you say we play golf after our next meeting.”
Mike: “There’s an idea.”
Level 2 Agreement: Likes the idea, but no agreement.
Brian: “Hey Mike, let’s play golf after our next meeting.”
Mike: “Good idea!”
Level 3 Agreement: Reluctant agreement–but no commitment to do anything.
Brian: “Mike, Let’s play golf after our next meeting.”
Mike: “Man, I am really swamped, I better not.”
Brian: “Come on Mike, this will probably be our last chance before snowfall.”
Mike: “OK, I’m in.”
Level 4 Agreement: Enthusiastic agreement–but no commitment to do anything.
Brian: “Mike, let’s play golf after our next meeting”
Mike: “Great idea! Count me in.”
Level 5 Agreement: Specific commitment of who is going to do what by when, stated by the accountable person.
Brian: “Mike, let’s play golf after our next meeting”
Mike: “Great idea!” I’m in.”
Brian: “Where do you want to play.”
Mike: “Let’s play at my club. I’ll make a tee time for after our meeting.”
Brian: “How about if we have our meeting at your club so we can tee off right after that.”
Mike: “Great, I’ll meet you at my club for our monthly one-to-one on Friday at 2:00 pm and make a tee time for 3:30 pm.”
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Accountability increases with the level of agreement. If you are having trouble holding people accountable, push for a Level 5 Agreement, with a specific commitment to what is going to get done, by whom, and by when that is stated by the accountable person. It may take a little longer, but it will increase accountability and execution–and will save you a lot of time in the long run.
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Is your business model dying? How do you know?
All Blog Posts, Business, Strategy, Vistage Peer Groups / 30.10.2011
- Why did XEROX give the mouse and “windows” technology to APPLE?
- Why didn’t AT&T invent SKYPE?
- Why didn’t MICROSOFT invent GOOGLE?
- Why didn’t BLOCKBUSTER invent NETFLIX?
- What changes have you made to your business model in the last couple of years?
- If an employee came to you with a “game changing” idea that might threaten your core business in the short term, would you listen to them?
- Is your business model dying, how do you know?
A Death in Cupertino | The Right Kind of Tyrant
All Blog Posts, Motivation, Vistage Peer Groups / 11.10.2011
“ Remembering that I’ll be dead soon is the most important tool I’ve ever encountered to help me make the big choices in life; because almost everything —all external expectations, all pride, all fear of embarrassment or failure — these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose.
You are already naked. There is no reason not to follow your heart.”
Steve Jobs
1955-2011
Founder and CEO of Apple
From his Stanford University Commencement Address, 2005
Picking an article to share with you about the passing of Steve Jobs is an impossible task with so many that knew him sharing their impressions on one of the most important entrepreneurs in history.
We have a saying in Vistage: “We invite CEOs to our group but human beings show up.” To get a sense of what was important to this truly remarkable and essestial human being, I’d like to share with you the 15 minute video of his 2005 Stanford Commencement speech. I found it incredibly inspirational, and I hope you will share it with your friends, family and employees.
This inspiring speech, however, should not blind us to the fact that Steve Job’s management style was often very different from the warm, fuzzy and friendly feeling you get from using his products or visiting the Apple store at the mall. For some insights into the management style that made Apple the most valuable company in America, check out this article which suggests that if Steve Jobs was often a hard man to work for, he was, in fact, “The Right Kind of Tyrant.”
Thanks, Steve, for all you have given us. Rest in Peace
Steve Jobs -- Americas Biggest Failure?
Numerous articles have been written about the resignation this past week of Steve Jobs as CEO of Apple (though he remains as chairman). I could list a dozen that I find compelling and you can easily find them online or elsewhere. It would be difficult to find one that does not celebrate his many successes. Fortunately, I found one that focuses on his many failures…and how they were indispensible to his breathtaking successes. Check out “Steve Jobs: America’s Greatest Failure” ; required reading for any entrepreneur….or those who manage one.
Read More >>Why I Admire CEOs of Small, Privately Held Companies
All Blog Posts, Vistage Peer Groups / 04.02.2011
Recently I attended a 30th anniversary celebration honoring 3 colleagues from my former company, PDI Ninth House. Like me, they had spent most of their careers working with Global 1000 firms all over the world. We shared memories of jet setting around the globe, working with top executives at major companies throughout the US, Asia, Europe, and the Middle East.
People were naturally curious about why, with all of my Global 1000 Company experience, I preferred to work with CEOs of small privately held companies. The short answer to that question is that I admire their courage and their total commitment to the success of their business and their people.
Jay Goltz expands upon this point in a New York Times article entitled “There are Two Kinds of CEOs” that appeared February 2, 2011. The article features a conversation between the writer and Rafael Pastor, the chairman and chief executive of Vistage, a leading organization of chief executives. They agreed that one of the biggest differences between CEOs of big public companies and CEOs who run small privately held companies is how connected the CEO is to the success of the business. While CEOs of both types of companies have significant upside consequences, the consequences of a business downturn are far more severe for the small private company CEO.
As Jay Goltz explains:
“When things get tough, instead of getting multimillion-dollar payouts to quit, many small-company C.E.O.’s are compelled to put even more money into the business. Mr. Pastor of Vistage recently polled the organization’s members on this question: “During this economic downturn, did you at any time pledge personal assets or invest personal money into your company to help weather the storm?” Forty-six percent said yes.
To many, betting the house may seem an insane risk to take. And maybe it is. But if small-business owners weren’t willing to take that risk, there would be far fewer small businesses in America. You see, many entrepreneurs are what I would call “all in”: all of their money, most of their time, and most of their ego and self worth and pride are involved. Sometimes they put too much in, at the expense of their families and general well-being.
But the fact is that when small company chief executives fail, they often face dire consequences. And that’s an aspect of business ownership that is rarely noted in the glamorized view of entrepreneurship that we frequently see portrayed. Nor is it fully understood by public officials who always seem eager to have small businesses borrow more aggressively and hire more aggressively.”
Read More >>
Dejected Cutler Listens to iPod on Sidelines while Bears Lose to Packers in NFC Championship
Jay Cutler of the Chicago Bears created a lot of controversy last week when a knee injury prevented him from finishing the NFC conference championship game against the Green Bay Packers. Many questioned his toughness, and believed he had “quit on his team” during their most important game of the year.
An MRI later showed the injury was indeed serious, and confirmed the decision for him not to play. It did not, however, excuse the lack of leadership and poor attitude he displayed during the remainder of the game. Instead of cheering on his teammates or supporting the backup quarterbacks, cameras repeatedly caught him sulking on the sidelines, listening to his iPod.
The lesson for CEOs is that, like Jay Cutler, we are always “on camera” in our organizations. We need to periodically check ourselves to make sure we haven’t succumbed to bad leadership habits and make sure that we aren’t displaying a poor attitude, which can be contagious for the rest of our organization.
Mike Myatt makes a compelling case that attitude reflects leadership and is a decision.
“Show me a CEO with a bad attitude and I’ll show you a poor leader. While this sounds simple enough at face value, I have consistently found that one of the most often overlooked leadership attributes is that of a positive attitude. As a CEO, how can you expect to inspire, motivate, engender confidence, and to lead with a lousy attitude? The simple answer is that you can’t…it just won’t work. CEOs with bad attitudes will not only fail to engage their workforce, but they will quickly find themselves shown the door as their attitude’s impact on performance becomes visible to the board.”
Do you need an attitude adjustment? Click here for a 5 point checklist to check yourself, and some compelling statistics about why you may want to change.
Read More >>Research backs claims that Vistage CEOs outperform their nonmember peers.
All Blog Posts, Vistage Peer Groups / 31.10.20101 comments
In last week’s post, I featured a CNBC broadcast regarding Vistage Member CEOs forecasting short term growth for small companies over the next two quarters. In that report was a caveat that Vistage CEOs may not be a totally representative sample of Small Business CEOs, because independent research shows that they consistently outperfom peer nonmember companies. I asked Vistage International to share their evidence, and was impressed with the research they produced. As can be seen from the graphs below, a Vistage Sample of 1265 member companies was compared with a statistically matched sample of about a million D & B nonmember companies. Over the period 2006 though 2009, Vistage companies outperformed nonmember companies on CAGR by15 percentage points. Moreover, this trend was consistent across all major business segments, ranging from a 13.2 percentage point difference in the Transportation and Communication Sector, to a 25.7 percentage point difference in the Wholesale Trade sector. In other words, in one of the toughest economies in history, Vistage member companies averaged 5.8 % revenue growth, while nonmembers averaged a (9.2%) revenue decline. In future posts, we will explore the factors that contribute to that sizeable performance difference.
Read More >>