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My Leadership Favs Over 2 Years July 7, 2009

Posted by Bruce Temkin in Executive leadership.
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In a continuation of the look back at my first two years of blogging, today I’m listing some of my…

Favorite Leadership Posts

The essence of leadership is captured in this quote by Napoleon:

The role of the leader is to define reality and give hope

The bottom line: Good leadership is a scarce resource.

Words Of Wisdom On The 4th Of July July 4, 2009

Posted by Bruce Temkin in Customer experience, Executive leadership, Words of wisdom.
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Since it’s the 4th of July, I want to wish everyone who is celebrating the holiday a…

Happy

Independence

Day!!!

In honor of the holiday, I decided to look back at some insights from a couple of our founding fathers.

Let’s start with a quote from John Hancock:

There’s only so many priorities that you can fund. What you choose to target, you need to win.

Here’s a quote from Samuel Adams:

Mankind are governed more by their feelings than by reason

My take: John Hancock points to an important concept — focus — which is something I spoke about in a post about Mayor Booker from Newark, NJ and in a post called Leadership Lesson: Less Is Better.

Samuel Adams’ quote talks about the need for empathy, which is critical when dealing with customers and employees. This quote from the Cleveland Clinic captures the essence of how to think about your customer interactions: ”The patient is not only an illness, he has a soul.”

When it comes to employees, this is a clear call for companies to focus on their corporate culture, which is why the first management imperative listed in my free eBook is ”Invest In Culture As A Corporate Asset.” 

The bottom line: Enjoy your 4th of July!

Will An Efficient Culture Destroy Microsoft? June 4, 2009

Posted by Bruce Temkin in Corporate culture, Executive leadership.
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I just read an interview of Microsoft’s CEO Steve Ballmer in the New York Times that really caught my eye. Ballmer was asked the following question: “Fill in the blank. You want the culture of your company to be more __________?”

Here was his response:

Efficient. The right word is efficient. That’s the direction that every business leader is steering their corporate culture. Given the current economic climate and the uncertainty about how long the recession will last, this is a time when organizations need to do more with less, Microsoft is no exception…

My take: For Microsoft’s sake, I hope that Ballmer misspoke. For all of our sakes, I hope that he’s wrong.

I can’t imagine how awful it would be to work in a company if its culture was built around efficiency. Don’t get me wrong, I aim to be hyper-efficient. But that’s quite different from defining efficiency as the cornerstone of your corporate culture.

What type of an environment would it be if the most important thing that employees cared about, were measured on, and got promoted for was efficiency? The answer: Horrible.

There’s no doubt that Microsoft, like other companies, needs to do more with less in this economic downturn. But creating a culture focused around efficiency would be one of the worst responses to this environment.

So, as I said, hopefully Ballmer misspoke. If not, I anticipate a very difficult time for Microsoft as it struggles to retain employees (who get burned out) and customers (who want more than efficiency). And we can say goodbye to any innovation in Redmond. That’s just not efficient.

My suggestion to Ballmer: Redirect towards a customer-centric culture.

The bottom line: Efficiency may be a good goal, but it’s a terrible culture.

Is It Time For An Unconventional Strategy? May 7, 2009

Posted by Bruce Temkin in Executive leadership.
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I just read a very interesting article in The New Yorker called How David Beats Goliath. It looks at how underdogs (from basketball teams to Lawrence Of Arabia) can overcome a seemingly insurmountable enemy. Not surprisingly, I was drawn to the data that was mentioned in the article.

The article weaves in findings from research that examined 202 lopsided wars over the last 200 years. I used the data to create this graphic:

Underdogs Win Wars With Unconventional Strategies

My take: Wow! If this data is accurate, then it shows that underdogs have dramatically shifted their odds by changing the approach to battle. Here are a few lessons that companies can learn from this article:

  • Don’t attack a strong competitor head-on. Instead of playing the normal style of basketball against a highly talented UMass basketball team (lead by Dr. J), Fordham University used a full-court press to beat the heavily favored Redmen in 1971. Lesson: Find places where your competitors aren’t strong or aren’t prepared.
  • Take advantage of ”conventional wisdom.” While combat was traditionally done with a sword, David recognized that he could not beat Goliath with that approach — so he used a sling and some stones. Lesson: You can often times anticipate how competitors will act or react.
  • Play to your strengths. When Lawrence of Arabia was charged with ovetaking the Turks, he took advantage of the strengths of his untrained, Bedouin fighters — endurance, knowledge of the country, and courage. He led them on a 600 mile loop to attack the Turks from an unprotected flank. This group of several hundred nomads ended up killing or capturing 1,200 Turks and lost only two men. Lesson: Develop a strategy that uses your strengths.

The bottom line: Davids can absolutely beat Goliaths

Macy’s Pushes Execs In The Wrong Direction March 27, 2009

Posted by Bruce Temkin in Customer experience, Executive leadership.
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Macy’s announced that it will be tying executive compensation to the performance of the company’s stock price over the next three years. That’s an interesting approach given this recent advice from Jack Welch:

On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy… Your main constituencies are your employees, your customers and your products.

If I were one of Macy’s shareholders, I’d rather have the execs focused a little less on the stock price and a little more on employees and customers. Maybe they should tie executive compensation to Forrester’s Customer Experience Index. Macy’s ended up tied for 15th place out of the 25 retailers we examined; well behind other department stores like Kohl’s and JCPenney.

Rather than following an outdated management approach, I suggest that Macy’s execs download my free book: “The 6 New Management Imperatives: Leadership Skills For A Radically Changed Business Environment.” In it they will find 6 alternative places to focus their energy:

  1. Invest in culture as a corporate asset
  2. Make listening an enterprisewide skill
  3. Turn innovation into a continuous process
  4. Provide a clear and compelling purpose
  5. Extend and enhance the digital fabric
  6. Practice good social citizenship

The bottom line: Isn’t it time for new management thinking?

Southwest Airlines Soars Above Its Peers March 24, 2009

Posted by Bruce Temkin in Customer Experience Index, Customer experience, Executive leadership.
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I’m writing this post as I’m flying to Puerto Rico on America Airlines. Seems like an appropriate time to discuss my new report: Customer Experience Index (CxPi) 2008 Snapshot: Airlines. The research examined the results of the seven airlines in the 2008 CxPi: American Airlines, Continental Airlines, Delta Airlines, Northwest Airlines, Southwest Airlines, United Airlines, and US Airways.

The results are probably not surprising:

  • Airline experiences are mostly poor. The average CxPi score for the airlines was 65; on the cusp between an ”okay” and “poor” rating. But six of the seven airlines received “poor” or “very poor” ratings.
  • Southwest stands out from the pack. The top scoring airline, Southwest received a CxPi score of 81%; a “good” rating. The next airline on the list, Continental, was a whopping 14 points behind.
  • US Airways dissapoints the most. Coming in at the bottom of the list is US Airways, with a “very poor” rating of 50%. That score earned the airline the 103rd spot out of the 113 firms in the CxPi. Northwest was the next to last airline with a 56% score.

It might have been a closer race if we had data for some other airlines like JetBlue and Virgin America. But there’s no doubt that Southwest does things differently than most airlines. The differences start at the top. I often refer to this quote from Herb Kelleher, founder of Southwest Airlines: 

If you create an environment where the people truly participate, you don’t need control. They know what needs to be done and they do it. And the more that people will devote themselves to your cause on a voluntary basis, a willing basis, the fewer hierarchies and control mechanisms you need.

The bottom line: The airline industry could use more leaders like Kelleher

9 Management Principles From Dilbert’s Boss March 17, 2009

Posted by Bruce Temkin in Executive leadership.
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I search for insights wherever I can find them: from business visionaries to cartooning geniuses. That’s why it seems appropriate to follow advice from Jack Welch with some thoughts from Scott Adams (creator of the Dilbert cartoon). In a recent blog post, Adams shares these management principles he uses in his restaurants:

  • Have fun. Loosen up.
  • Try something new. Often. Keep whatever works.
  • No penalty for a new idea failing. Trying is the thing.
  • Employees are more important than customers.
  • Stop asking Scott for approval. Just do it.
  • Managers get to see the financials.
  • Being a jerk to coworkers is grounds for termination.
  • Do whatever seems smart and fair to make customers happy.
  • Watch the competition closely and borrow their best ideas.

The bottom line: Good advice from Adams; even without Dilbert.

Don’t Get Distracted By Shareholders March 15, 2009

Posted by Bruce Temkin in Executive leadership.
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I’ve learned a lot from Jack Welch, especially during my tenure at GE when I first heard him say: “Deal with the world as it is, not how you’d like it to be.” Once again he’s said something that every executive should hear:

On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy… Your main constituencies are your employees, your customers and your products.

Welch’s words are consistent with one of my key themes: ”Don’t let profits replace purpose.” This misplaced focus on shareholder value is one of the main reasons for my new mini-book: The 6 New Management Imperatives: Leadership Skills For A Radically Changed Business Environment. 

The bottom line: Make shareholders happy by ignoring them

Free Book: The 6 New Management Imperatives February 20, 2009

Posted by Bruce Temkin in 6 New Management Imperatives, Customer experience, Executive leadership.
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Download this free book- The 6 New Management Imperatives

A few months ago I introduced the 6 New Management Imperatives. Since then, I’ve written posts for each of the six imperatives.

As with my 6 Laws Of Customer Experience, I decided to pull the content together in a mini book. It’s called “The 6 New Management Imperatives: Leadership Skills For A Radically Changed Business Environment (.pdf).”

Since it’s not a novel (only 16 pages), I’m giving it away for free. Just click on the cover and print it out or save it to your computer.

Go ahead and share this book(let) with as many people as you’d like!

The bottom line: Hopefully this book is worth more than it’s price.

Management Imperative #6: Practice Good Social Citizenship February 10, 2009

Posted by Bruce Temkin in 6 New Management Imperatives, Customer experience, Executive leadership.
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Management Imperative #6

In a world where companies can control information leaks and quickly hide their mistakes, there’s little need to worry about public relations gaffs like exploiting underage workers in developing nations, dumping pollutants in remote settings, or overselling mortgages to needy home buyers. But we don’t live in that world anymore.

The Internet has created an enormous spotlight that quickly shines on any corporate malfeasance. Whether it’s the uproar of a community of bloggers or an embarrassing video posted on YouTube, corporate executives can expect large numbers of people to learn about their mistakes.

In this environment, where the cost of problems has dramatically increased, companies need to step up their commitment to corporate social responsibility, which is nicely described in Wikipedia:

Organizations consider the interests of society by taking responsibility for the impact of their activities on customers, suppliers, employees, shareholders, communities and other stakeholders, as well as the environment.

Here are some areas in which executives can practice good social citizenship:

  • Have a clear social mission. The commitment to good social citizenship needs to be integrated in the firm’s overall mission. Tesco, for instance, incorporates it’s commitment to the community as a core component of its overall strategy steering wheel. Here’s an excerpt from it’s Website: Our commitments under the Community segment of the Steering Wheel are to be fair, responsible and honest in everything we do and to be a good neighbour.
  • Engage employees in community efforts. Don’t view social citizenship as just another top-down executive mandate. Instead, it should be used to engage employees. UMPQUA bank in Oregon, for instance, provides full-time employees with up to 40 hours per year –paid — to volunteer with youth and community development organizations and schools. The result: Employees feel good about working at UMPQUA. And engaging employees like this is a pre-requisite for engaging customers.
  • Be as green as you can be. When it comes to protecting our environment, we all can do a better job. But most shareholders look for companies to deliver ROI, not go green. So executives need to find investments that are both good for the environment and good for their bottom lines. To balance these elements, execs can adjust their funding requirements for “environmentally friendly” projects by factoring in the cost of good/bad press and allowing a longer payback period.
  • Make socially-conscious decisions. How can executives incorporate the right concern for social citizenship in their decision making? Assume there aren’t any secrets. Don’t make any decision that would hurt the company (or your career) if the press, employees, partners, or shareholders happened to find out about it. They will.

The bottom line: Make your organization socially proud; it’s good business.

P.S. Here’s a link to all 6 New Management Imperatives