We didn’t think so. Of course, there are a huge number of business leadership and management books available, so CEO’s looking for insight into best practices, success stories and tales of leadership gone horribly awry have no dearth of reading material. But what these works, which focus on the universal truths, lack is any advice specific to the day-to-day challenges and needs of your company. They can’t tell you, “Do X when Y happens,” because they deal with generalities and things that are the same across many organizations. They can certainly be useful, but your business, market and employees are unique.
If you had a CEO handbook written specifically for you, what might it tell you? Here are a few things we think you’d like to know.
If yours is like many organizations, you’re running lean and trying to accomplish your business goals with as few resources, particularly people, as possible. This often results in an attitude, of “just get it done,” with less emphasis on how. But, the how is arguably even more important for organizations with scaled back teams and limited budgets. How you do things determines how efficiently they are done and how little time, effort and money is wasted. Operations management efficiency can be achieved when a few conditions are met.
Merriam Webster defines efficiency as, “the ability to do something or produce something without wasting materials, time, or energy.” A prerequisite, therefor, is understanding exactly what you are going to do or produce. You simply can’t have operations management efficiency without a set of corporate goals and objectives as well as the key performance indicators against which success will be measured.
I think it is largely because of some of the major scandals of late, involving corporations from Enron to Countrywide and Bear Stearns, that “corporate accountability” is thought of as something that is imposed on businesses from the government or other outside entities. Enron brought us Sarbanes-Oxley and the mortgage backed securities disaster has led to a slate of new regulations designed to protect consumers and investors from dubious business practices and outright fraud. But, businesses should be accountable for a lot more than complying with the law. Corporate accountability is also about holding your organization answerable for the commitments and promises made to customers, partners, investors and employees.
When organizations fail to deliver on commitments, whether they are about improving products, working conditions, or shareholder value, it is rarely a willful breach. More often it is the result of conflicting priorities, lack of institutional memory and failed coordination. Here are a few ways you can make corporate accountability part of your culture.
Golf is an interesting game for a number of reasons. Although it is competitive, there is no defense, so a player’s performance is, for the most part, in their own hands. Golf is also unique in that the object is to do better than a predefined goal for each hole. Par is the expected result. Getting the ball in the hole in fewer strokes than par is an achievement, while needing more strokes is a miss. Missing badly, like I often do, can cost you the game. At the end of the round, your scorecard is a reflection of how successful you have been at achieving your targets. Your business performance scorecard should operate on the same principles.
If you think of your business performance scorecard like you do a golf scorecard, with each business goal representing a hole, the first thing you need to do is assign par for each goal. That means determining exactly what your business needs to accomplish during this quarter (the round) for that objective. Assigning par for your goal works much like assigning par for a hole. The scope (length) and level of difficulty must be considered along with any potential obstacles or hazards. Your performance scorecard will only be useful if you’ve made a realistic assessment about par.
Imagine that you are now the CEO. Further imagine that your organization is underperforming. Worse yet, your organization has low employee morale, high labor turnover, declining market share, falling profits, competitors that are under-pricing you, and constant criticism from your board of directors, investors and investment analysts.
Roulette is hard. I don’t mean complicated, it’s extremely simple. You just make a guess where the ball will land based on absolutely no data whatsoever. Sometimes you guess right, but casinos don’t stay in business by giving a lot of money away, so on the whole the gamblers are more than often wrong. If you have more money than you want, I absolutely recommend playing a lot of roulette. Sometimes predicting company performance feels a bit like playing roulette. Hopefully your guess is based on some data, but few organizations have the structure in place to gather the right data frequently enough to move the prediction out of the realm of guesswork. Here are a few ways to make predicting company performance less of a gamble.
For the roulette ball, one number is the same as every other. It doesn’t care where it ends up, but your organization does. Predicting company performance begins with understanding the highest level strategic objectives and breaking the down into smaller goals that can be assigned to divisions, departments, teams and individuals. If you want to enlist the entire team in the task of predicting company performance, every person must understand the goals so they can recognize progress and/or stagnation.
I hear managers and business leaders refer to their employees as “my team” all of the time, but based on results, it is likely that the term is very often over used. Teams have a certain set of characteristics that set them apart from mere groups of people with an employer in common. Thinking a bit about the nature of teams might make them easier to recognize or develop.
Goal setting is a fundamental element of team building. In fact the word “team” is defined as “a group of people linked in a common purpose.” That purpose is readily apparent is sports, it’s called a “goal post” for a reason. But, in business the goal isn’t always as obvious. Next time you are tempted to refer to your employees as a team, ask yourself if they are linked in a common purpose. Does everyone understand and agree with that purpose? Goal setting is the process by which that purpose is identified and broken down into manageable and measurable milestones along the way. It is the first and most essential element of team development.
The fundamental role of a leader of an organization is to provide guidance to a better future. This causes the CEO to be more focused in the future than the present and how to best guide the organization. Unlike a salesperson that spends most of their time focused on closing the deal today, the CEO must look to the future and anticipate any issues that might arise in the business.