There’s no such thing as a great company

There are great teams and not so great teams. The best companies are networks of great teams. When you look at organizations, there is a huge range in performance team by team by team. There are differences within high performing teams compared with underperforming teams. These differences impact not only business outcomes, but lead measures like the ability to attract and retain talent that create the valued product or service that customers trade money for.

In 1994, a HBR article titled Putting the Service-Profit Chain to Work (J. L. Heskett et al.) introduced a model that is widely referenced and used. This year, DDI published their DDI’s 2011 Global Leadership Forecast. In it, they illustrate an adapted version of this value chain based on their huge biannual leadership study. Integrating the two looks something like this:

I do this to illustrate a (simplified) sense of cause and effect. The best companies are made up of great teams. Great teams have high quality leadership that build a uniquely positive work environment / climate. This leadership and context supports team member engagement in work that allows them to contribute their strengths. While the local leader exists within a system – enabled or confined by talent systems and process, as well as the broader management culture – it is the leadership of the local manager that has the greatest impact on the engagement and performance of their team. While leaders are as much a product of this system as they are nodes within it, positive deviants exist and they make the most significant difference. Most team members’ knowledge of and beliefs about the organization are driven by how the organization is presented and exemplified through their local leader’s words and behavior.

Curt Coffman and his partner Kathie Sorensen have taught me a lot about how local managers drive engagement. Most engagement research consists of reporting data collected from a large sample of employees from a broad set of teams and organizations – how do a broad range of factors impact engagement. Coffman’s research surfaced drivers of engagement by finding the correlation between employee responses to questions and team performance. For example, while a question like, “I’m fairly compensated…” is a highly rated hygiene factor that individuals rate as highly influencing their level of discretionary effort and intent to stay, It’s important to everyone regardless of performance level. However the question “My manager really knows me” is rated significantly higher on high performing teams than low performing teams. This research shows that highly engaged teams delivering superior results are different and the key differences are under the control of and most influenced by the local leader.

Despite more than a decade campaign to refocus leaders on achieving greatness through allowing talent to contribute those things they are truly great at, we remain fixated on being “not-bad” by trying to put in what’s not there or improve what we are remedial at. Good is not the opposite of bad. It’s entirely different.

“We all have a vast number of areas in which we have no talent or skill and little chance of becoming even mediocre. In those areas a knowledge workers should not take on work, jobs and assignments. It takes far more energy to improve from incompetence to mediocrity than it takes to improve from first-rate performance to excellence.” ~ Peter F. Drucker

There’s no perfect job. The ideal for most people, when they are asked to describe it, is an enriched and empowered variation of what they are doing now.

SO WHAT?

Glad you asked. Leadership matters. How we feel about our contribution at work matters too. Focusing on these two things will make you and your organization more effective.

Leaders – Focus on leadership drivers of engagement. How would those you lead respond? Ask them?

  • What are the outcomes that you are accountable for?
  • Do you feel that you really know me? Is there anything you’d like to know?
  • Do you see additional opportunities where you could contribute your talents and abilities?
  • What’s the best (most meaningful) recognition you’ve ever received at work?
  • What are you doing when you’re doing what you’re best at?
  • Who was the best manager you’ve ever had? Tell me about what he or she did that you liked so much?
  • How do you feel you best add value to the organization?
  • What are the strongest teams in our organization? Tell me about the strongest team you’ve ever been a member of?
  • When have you grown most professionally in your career?

Each of us must better understand our strengths and use them more. This will serve our personal interests, benefit our organizations and the stakeholders we impact – family, community, etc.

What, in your experience, causes an organization to be seen as great?

Measures that Lead

James Slavet’s recent post Five New Management Metrics You Need To Know at Forbes is excellent. It presents five examples of lead measures (he calles them inputs) that organizations are using to drive performance. I call them lead measures because I first learned the concept of how important it is to have both lead and lag measures identified was in a presentation DDI President Bob Rogers delivered after the release of his excellent book, Realizing the Promise of Performance Management. His presentation was simple and impacting – effective strategists and leaders are looking forward, planning and developing capabilities that will cause the outcomes sought. In contrast, many more often see the situation where the person in charge reminds us of the budget targets that were given, where we are for the past month, YTD and YOY…followed by praise, reward, threats and consequences; quite Pavlovian. Imagine watching a baseball or football game where the commentary and coach interviews revolve only around the number of runs / points each team had scored…no on-base percentage, yards-per-carry, time of possession, defense formations, etc. It would be moronic. There are important outcomes and status towards those outcomes that are important to measure and review, but the real work is done when performers are aligned with actions that will cause success and measures of these drivers are identified, implemented and tracked to create change.

This Post provides a couple of nice examples. My favorite analogy is likening lead measures to the arrows on a bowling lane (and this video cracks me up).

Lead measures focus talent on behaviors that will cause success. So why aren’t they more effectively used? I believe it’s fundamentally cultural. It’s difficult to choose and use the right lead measures if you’re not in the business. As a leader, with all the related demands, you’re not spending time at the process level where value is created unless you make it a priority because you see it as your role to serve the processes and those that execute them. The best I’ve witnessed are from leaders that practice and value gemba walks. With a balanced set of lead and lag measures not only will outcomes improve, but you’ll know why. You will likely even be able to foresee opportunities and threats much earlier while there’s time to mitigate, reduce losses and capitalize on opportunities.