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Category Archives: Business

This is where all thoughts on business, organizations,people and performance go into.

Too many managers, too few leaders…

This in one of the most idiotic statements to have come out in management discourse.   I use the word “idiotic” in the same way that Warren Buffet uses it.  When asked in an interview, why did the crash happen,  he  replied, “in any market there are 3 types of people, a: the innovators who pioneer new ways of doing things, b:  the copycats who then learn what the innovators do and follow with full understanding what they are doing and finally c: the idiots who do it just because everyone else is doing it.

Idiots have a special role in the market place as they do things not out of understanding but simply by jumping on the bandwagon. All crisis and accidents can almost be traced back to an idiot who made a decision without understanding the risk and implications of the decisions.

Coming back to the concept of “too many managers, too few leaders.”  The first mistake the idiots (or more politely, the proponents of the above) make is to confuse role with task.  Managing and leading are not enshrined in roles but in tasks.  Every person who has even 1 subordinate has the task to manage and the task to lead. And the biggest idiots in town are the consulting houses and  the peddlers of leadership development.

Today, due to the enormous hype around notion of “leadership” created non other than Jack Welch, the task of managing has taken a complete back seat.  It has gone so ridiculously far that what used to be called “management team” is now being called “leadership team”!

The second mistake that is been made is pouring so much time and effort into Leadership Development and forgetting about Management Development.  With increasing mobility of people across organizations and a penchant for hiring those with “leadership abilities” at the expense of  “management ability,” companies are shooting themselves in their foots.

If anything I will argue that the biggest problems faced by organizations is the lack  people who excel in the task of management. We need to refocus and get back to the fundamentals, that the act of managing and leading are both tasks within the role of one who supervises.

Here is a nice article to read on the matter:

True Leaders Are Also Managers

8:20 AM Wednesday August 11, 2010

by Robert I. Sutton | Comments (39)

Ever have occasion to do an in-depth review of the academic and practical literature on leadership? I have — twice in the past five years. The first time was for a 2006 book with Jeff Pfeffer, Hard Facts, Dangerous Half-Truths, and Total Nonsense. The second time was for my new book, Good Boss, Bad Boss.

It is impossible to read it all.

Tens of thousands of books have been written on leadership and there are several academic journals devoted entirely to the subject, including The Leadership Quarterly and The Journal of Leadership and Organizational Studies. Perhaps the most definitive review and integration of the leadership literature was Bass and Stogdill’s 1,200-page Handbook of Leadership, which was published in 1990 (and still does the best job of making sense of the literature, for my money). And if you really want a long book on leadership, you can get the four-volume Encyclopedia of Leadership, which at 2,120 pages weighs in at 15 pounds, and costs a whopping $800. Clearly, the task of reviewing the leadership literature — and acting on it as leader — isn’t to understand it all (that is impossible), but to develop a point of view on the few themes that matter most.

In my reviews of the writings and research, I kept bumping into an old and popular distinction that has always bugged me: leading versus managing. The brilliant and charming Warren Bennis has likely done more to popularize this distinction than anyone else. He wrote in Learning to Lead: A Workbook on Becoming a Leader that “There is a profound difference between management and leadership, and both are important. To manage means to bring about, to accomplish, to have charge of or responsibility for, to conduct. Leading is influencing, guiding in a direction, course, action, opinion. The distinction is crucial.” And in one of his most famous lines, he added, “Managers are people who do things right and leaders are people who do the right thing.”

Although this distinction is more or less correct, and is useful to a degree (see this recent interview with Randy Komisar for a great discussion of the distinction), it has unintended negative effects on how some leaders view and do their work. Some leaders now see their job as just coming up with big and vague ideas, and they treat implementing them, or even engaging in conversation and planning about the details of them, as mere “management” work.\

Worse still, this distinction seems to be used as a reason for leaders to avoid the hard work of learning about the people that they lead, the technologies their companies use, and the customers they serve. I remember hearing of a cell phone company CEO, for example, who never visited the stores where his phones were sold — because that was a management task that was beneath him — and kept pushing strategies that reflected a complete misunderstanding of customer experiences. (Perhaps he hadn’t heard of how often Steve Jobs drops in at Apple stores.)

That story is typical. “Big picture only” leaders often make decisions without considering the constraints that affect the cost and time required to implement them, and even when evidence begins mounting that it is impossible or unwise to implement their grand ideas, they often choose to push forward anyway .

I am all for dreaming, Some of the most unlikely and impressive things have been done by dreamers. But one characteristic of the dreamers I respect — Francis Ford Coppola, Steve Jobs, folks at Pixar like Ed Catmull and Brad Bird — is that they also have remarkably deep understanding of the industry they work in and the people they lead, and they are willing to get very deep into the weeds. This ability to go back and forth between the little details and the big picture is also evident in the leaders I admire most who aren’t usually thought of as dreamers. Anne Mulcahy’s efforts to turn around Xerox were successful in part because of her in-depth knowledge of the company’s operations; she was very detail-oriented during the crucial early years of her leadership. Bill George, one of Jim Collins’ level 5 leaders, told me that, in his first nine months as CEO of Medtronic (a medical device company), he spent about 75% of his time watching surgeons put Medtronic devices in patients and talking with doctors and nurses, patients, families, and hospital executives to learn the ropes.

I guess this is one of the themes that I have written about before, especially in The Knowing-Doing Gap (with Jeff Pfeffer). But it is bothering me more lately, as I’ve had some conversations with project managers who have been assigned tasks by naive and overconfident leaders — things like implementing IT systems and building software. When they couldn’t succeed because of absurd deadlines, tiny staffs, small budgets, and in some cases, because it simply wasn’t technically possible to do what the leaders wanted, they were blamed. Such sad tales further reinforce my view that thinking about what could exist, and telling people to make it so, is a lot easier than actually getting it done.

I am not rejecting the distinction between leadership and management, but I am saying that the best leaders do something that might properly be called a mix of leadership and management. At a minimum, they lead in a way that constantly takes into account the importance of management. Meanwhile, the worst senior executives use the distinction between leadership and management as an excuse to avoid the details they really have to master to see the big picture and select the right strategies.

Therefore, harking back to the Bennis theorem I quoted above, let me propose a corollary: To do the right thing, a leader needs to understand what it takes to do things right, and to make sure they actually get done.”

When we glorify leadership too much, and management too little, there is great risk of failing to act on this obvious but powerful message.

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Posted by on November 15, 2010 in Business, Leadership, Transformation

 

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Afzal Rahim competes with TM

Its not too often that one can say, “I told you so…” but here is a case of me getting it right….

On the 2nd Feb 2009 I wrote a post called Afzal Rahim and Time dot Com and in the post I said :

My takeaway from our short conversation is that TdC will not only survive, but will become a real market competitor to TM in the spaces that they compete.

My comments were in sharp contrast to what B.K. Shidu’s analysis as reported:

October 9, 2008 Let Afzal do his ‘magic’News Analysis by B.K. SIDHU, The Star

The reason why Afzal’s proposal was accepted over many others was because he just wanted to focus on the wholesale and enterprise business and not compete head-on with Telekom Malaysia Bhd (TM) in the retail market.

This had been a consideration for Khazanah, which is also a shareholder in TM.

In yesterdays papers (3rd Feb 2009) which is  exactly a year after my post this is what was reported:

KUALA LUMPUR: TIME dotCom Bhd (TdC) has launched its TIME Fibre Broadband high-speed Internet service that offers up to 50mbps data transfer speeds.

The service is currently available to residents in only seven locations in Mont Kiara – Pines, Palma, Pelangi, Sophia, Astana, Bayu and Damai.

Realising the possibilities: Afzal talking at a press conference when he introduced a high-speed Internet servcie yesterday.

TdC wants to make the entire Mont Kiara area fibre-capable by the end of next month and launch it in KLCC and its surrounding areas by the middle of this year, said chief executive officer Afzal Abdul Rahim.

He said the fibre-optic network used by TdC would connect directly to consumers’ homes to deliver new levels of speed.

According to Afzal, fibre-optic cables could carry 1,000 times more information than the current prevalent copper-centric and hybrid networks.

“We have no copper, no wires, only pure fibre-optic,” he told a press conference yesterday.

Afzal claimed that the TdC was currently the only provider of 100% direct-to-home fibre-optic Internet connection.

“The idea behind this new service is in realising the possibilities of big bandwidth broadband, where download and upload speeds range anywhere within a mere five seconds to five minutes for mp3 files, video clips and even high-definition movies,” he said.

In Malaysia, he said it was throttled to 2mbps, the country’s average broadband speed.

Purchasing and downloading a 3.16-gigabyte high-definition movie on Apple iTunes was throttled to 5mbps per second.

However, Afzal expected the external websites’ level of service to improve in the future as the country’s broadband speeds improve.

Fees start from RM149 per month for a 2mbps package, with the option to “Boost” speeds up to 10mbps for 10 hours per month.

It costs RM199 for 5mbps with Boost of up to 50mbps for 15 hours a month.

The upper-end package costs RM329 for 10mbps and the option to Boost up to 50mbps for 30 hours per month.

The Boost feature can be activated by the customer through a self-care portal on TdC’s website.

For more information, log on to www.time.com.my.

 
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Posted by on February 4, 2010 in Business

 

3 Simple Steps for Powerful Service Recovery

MAS SUCKS

As a business, there will come a time that you will fail a customer.  In some businesses it happens one in every million transactions and in other maybe one in every ten.  Whichever end of the spectrum you are, service recovery is key.  As we know an unhappy customer will speak to ten others and in todays age of blogs and social media, that ten is more likely to be ten thousand.

So mastering the art of service recovery is absolutely essential and here are the three simple steps which must be followed in the exact sequence:

  1. Start with an apology, “I am sorry”
  2. Take ownership of the failure, “It is my fault”
  3. Ask how you can make it better, “What can I do to make it better?”

The above 3 are really simple to do and when you do it, you truly regain the confidence of the customer.

Service Recover Case Study:

Here is a real apology from a CEO of an airline to a customer:

I am sorry for the unpleasant experience and I can understand your frustration. I don’t know what went wrong here. We will get to the bottom of this. Please give us a chance to win you back as a customer.

The CEO does very well with the apology and he somewhat takes ownership for the problem but he doesn’t do part 3 which is to simply ask, “what can I do to make it better?”

Now contrast this to the reply that the same passenger got from the Senior General Manager of the same airline :

Thanks for the feedback.

I will get back to you soon. In the meantime, can I assist you in the (destination) booking. We can offer you the same rate as you saw in the internet.

Best Regards

The Senior General Manager doesn’t offer the customer an apology and doesn’t take ownership of the problem. All he does is offer to complete the transaction at the same price.  There is no regard whatsoever for the inconvenience  or any offer to “compensate” for the inconvenience.

Simply compare the response from the CEO and the response from the Senior General Manger and you tell me, via the poll below, which would you prefer?

So remember – when you fail a customer you must go into service recovery mode to ensure that the trust of the customer is won over. And all you have to do is follow the 3 simple steps, in the exact sequence:

  1. Start with an apology, “I am sorry”
  2. Take ownership of the failure, “It is my fault”
  3. Ask how you can make it better, “What can I do to make it better?”

The example cited above is  a real case  between Malaysian Airlines and  a customer. You can view the fully story here:

Does MAS Service Really Suck?

Does MAS Service Really  Suck? 2

Does MAS Service Really  Suck? 3

 
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Posted by on July 17, 2009 in Business

 

The 5 Value Adding Roles in an Organizational Structure

While we are very familiar with organizations structures, very rarely do we understand the true power of a structure.


Organization structures are primarily designed for “control.” With an organization structure it is easy to allocate accountabilities and responsibilities through the creation of jobs. The organization chart is the visual representation of the organization structure However a keen understanding of structure can transform it from a control tool to an enabling too.

The real power of organizational structure is in driving:

  • Business efficiency
  • Process integrity
  • Cost & resource optimization
  • Accountability
  • Clarity

Organizations are made up of 5 unique value adding components, each in support of the whole. An understanding and leveraging these 5 components can easily translate into a huge gains in performance:

The 5 Unique Value Adding Components of a Structure:

  1. Operating Core
  2. Strategic Apex
  3. Middle Line
  4. Technostructure
  5. Support

(Mintzberg, 1973)

Operating Core: The operating core is where the business meets the customer. This is where the real exchange of service for money happens.  Sitting in the operating core are all the jobs that enable this transaction to occur or to support the jobs that enable this transaction to occur. (sales person, cashier, stock keeper, sales manger, …)

Strategic Apex: This is the very small part of the organization that is thinking of the future.  Where will we have to be in the next 3 years and what will that look like. Typically a portion of the CEO’s role is in the strategic apex.

Middle Line: The middle line is what connects the strategic apex to the operating core, bringing the future into the present.  Here are jobs are focusses on driving continuos change into the operating core.

Support: This what I call the necessary evil, jobs that are needed to support the functioning of the organization but dont give rise to competitive advantage. For example if you run a large factory you may need an in house clinic, cafeteria, gymnasium, to minimize work downtime, but you don’t need to be running the facilities.

Technostructure: This is the exact opposite of support, here all the jobs that are focused on creating and sustaining competitive advantage are located. These are the jobs that continuously improve the way work gets done in the operating core.

Leveraging your structure:

Here are some simple things you can do to analyze your structure:

  • Try to slot the existing roles in your organization into the 5 categories
  • Look at the number of roles in each category and compare to the other. (very common is a high number of support roles and insufficient technostructure roles.)
  • Add up all the salaries in each category and it will show you how your money is being used.

When doing the above, don’t be guided by job titles. Instead you need to see what role actually does.

Organizations often find themselves in either one of these 2 situation:

If you find your organization to be heavy in support you probably have too much bureaucracy going on which can be bad.

If you find your organization to be light in technostructure you probably have too little innovation going on which can be bad.


Understanding organization design is a critical managerial competency. A poor understanding gives rise to poor utilization of resources and a strong understanding gives rise to high productivity.

As part of our Business Performance Coaching Program we do offer a 2.5 day Developing an Accountable and Effective Organization module to help leaders and managers leverage the power of their organizations.

 
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Posted by on June 29, 2009 in Business

 

The 5 Value Adding Roles in an Organizational Structure

While we are very familiar with organizations structures, very rarely do we understand the true power of a structure.


Organization structures are primarily designed for “control.” With an organization structure it is easy to allocate accountabilities and responsibilities through the creation of jobs. The organization chart is the visual representation of the organization structure However a keen understanding of structure can transform it from a control tool to an enabling too.

The real power of organizational structure is in driving:

  • Business efficiency
  • Process integrity
  • Cost & resource optimization
  • Accountability
  • Clarity

Organizations are made up of 5 unique value adding components, each in support of the whole. An understanding and leveraging these 5 components can easily translate into a huge gains in performance:

The 5 Unique Value Adding Components of a Structure:

  1. Operating Core
  2. Strategic Apex
  3. Middle Line
  4. Technostructure
  5. Support

(Mintzberg, 1973)

Operating Core: The operating core is where the business meets the customer. This is where the real exchange of service for money happens.  Sitting in the operating core are all the jobs that enable this transaction to occur or to support the jobs that enable this transaction to occur. (sales person, cashier, stock keeper, sales manger, …)

Strategic Apex: This is the very small part of the organization that is thinking of the future.  Where will we have to be in the next 3 years and what will that look like. Typically a portion of the CEO’s role is in the strategic apex.

Middle Line: The middle line is what connects the strategic apex to the operating core, bringing the future into the present.  Here are jobs are focusses on driving continuos change into the operating core.

Support: This what I call the necessary evil, jobs that are needed to support the functioning of the organization but dont give rise to competitive advantage. For example if you run a large factory you may need an in house clinic, cafeteria, gymnasium, to minimize work downtime, but you don’t need to be running the facilities.

Technostructure: This is the exact opposite of support, here all the jobs that are focused on creating and sustaining competitive advantage are located. These are the jobs that continuously improve the way work gets done in the operating core.

Leveraging your structure:

Here are some simple things you can do to analyze your structure:

  • Try to slot the existing roles in your organization into the 5 categories
  • Look at the number of roles in each category and compare to the other. (very common is a high number of support roles and insufficient technostructure roles.)
  • Add up all the salaries in each category and it will show you how your money is being used.

When doing the above, don’t be guided by job titles. Instead you need to see what role actually does.


Understanding organization design is a critical managerial competency. A poor understanding gives rise to poor utilization of resources and a strong understanding gives rise to high productivity.

As part of our Business Performance Coaching Program we do offer a 2.5 day Developing an Accountable and Effective Organization module to help leaders and managers leverage the power of their organizations.

 
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Posted by on June 29, 2009 in Business

 

The 7 Abilities Leaders Must Have

7 High Performance Abilites

It is safe to say that the first test of a leader is to deliver results – “deliver what you promise.” After all leadership is not judged by what you say instead it is judged by what you do. If we agree to the above hypothesis, then the next question is, therefore what are the abilities required by a leader to “deliver what she promises?”
The answer is – there are 7 abilities, but before I rattle them off, let me give some context to it through 2 immutable facts of high performing organizations:

Fact 1: all business exist to grow in value over time. Call it enterprise value, shareholder value, whatever but the underpinning raison d’etre of a buinsess is to grow.
Implied in the notion of growth are 2 laws –  the law of continuos change and  the law of rising targets. Einstein once said  “insanity is to keep doing the same things, expecting a different result.” So growth by definition means continuously doing things differently  – which means continuos change and growth by definition means setting higher and higher goals, which means rising targets.

Fact 2: all businesses that grow – at a very micro level have 1 common trait. They are  continuously innovating, looking at results and thinking about those results. They then experiment to try and see if they can produce results faster, better and cheaper. They then reflect on their experiment results and once satisfied, they act on it or implement it.  Then the cycle starts all over again. This virtuous cycle of Think->Experiment->Reflect->Act over and over and over and over again is what makes good companies, great. Its as simple as that.

Implied in the notion of continuously innovating in this virtuous cycle is the capacity for thinking,  measuring and implementing. So from the 2 immutable fact of high performing organizations, we distill out the 7 High Performance Abilites as follows:

The 7 Abilities:

1. Ability to Think: As funny as this may seem, because of conditioning we struggle to think beyond our normal thinking patterns.  Thinking in its most basic form is  the ability to link cause and effect, a step higher is the ability to connect unrelated events and the highest from is philosophy. High Performing Managers deliver on their promises by out thinking the competition.

2. Ability to Count: Here is another one that seems so obvious because who cannot count? Well, lots of managers do struggle with numbers, not the quantity but the quality of it. They will say things like lets grow sales by 10% (quantity) but fail to grasp what it will really takes to do 10% (quality). High Performing Managers have an ability to add quality to their numbers and through that understand exactly how they will leverage their organization to deliver as promised.

3. Ability to Communicate: Communications is the ability to get an idea across. and to leverage your resources you need to communicate. High Performing Managers know that communications is not about the ability to talk but the about the ability to get people to act on what is said.

4. Ability to Lead: Leading means getting your people organized, pointing them in the right direction, motivating them, developing team capabilities, coaching and engendering a can do spirit. High Performing Managers are able to to get seemingly ordinary employees to produce extraordinary results.

5. Ability to Drive Change: The definition of insanity is to keep doing the same things, but expecting a different result. High Performing Managers are adept at getting their people to continuously do things differently to produce better resutls.

6. Ability to Manage for Performance: Managing for Performance mindset that ensures every member of the team “delivers as promised.” High Performing Managers know how to manage their people for results.

7. Ability to Deliver Results: Ultimately its all about results. High Performing Managers  have a mindset that nothing is impossible and everything is possible.  The use the 6 above mentioned capabilities  to achieve the 7th.  High Performing Managers are driven by the goal.

Look at your managers and objectively assesses each one against the above 7 abilities. If they have it, then your organization is safe, if they don’t then you need to help them acquire the 7 abilities, after which your organization will never be the same again.  See how we help clients develop these 7 abilities (click here).

Please share with me your thoughts..

 
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Posted by on June 18, 2009 in Business, General

 

Growing Enterprise Value in turbulent times

If you are thinking of how to grow the value of your enterprise especially in these difficut times, then you must read this article. I will share with you the 2 things that if your organizations does very well – you will grow.

The first is “Managing of the Strategic Agenda” and
The second is “Managing the Execution of the Strategic Agenda”

Before we dive into the discussion, we need to first understand the phrase “strategic agenda” and the key  is to understand the word ‘Strategy.’ It is unfortunate that the word ‘strategy’ which is a simple yet profound word has been so misused simply because it is sexy. Therefore for the purpose of this discussion we will use the word strategy defined as follows:

Strategy in itself simply means establishing clear differentiation that gves rise to sustainable competitive advantage. The goal of strategy is to maximize the firms share of profit within its industry.

Therefore the phrase strategic agenda simply means the plans that will allow you to realize the strategy”

The next 2 word that need to be differentiated are “manage” and “execute” and in this case , manage means the act of ensuring that the strategic agenda the point of convergence of all plans, initiatives, actions etc. Execution is the ensuring that there are indeed plans, initiatives, actions and that they are all been acted on.

The accountability for “managing the strategic agenda” rests with the Board and it includes ensuring that there is a well articulated strategy that will achieve differentiation and sustainable advantage. And to ensure that progress is being made toward that realization of that strategy.  It can take years of actions and many many steps before one is  able to say that the strategy has been realized, and hence managing the strategic agenda, ensuring that the organization doesn’t lose sight or get distracted from the strategic agenda is crucial for long term success.  It also means that Boards must ensure that they are, in heart and in soul, aligned and committed to that agenda and are prepared to provide the resource for management to realize that agenda.

The accountability for the “execution of the strategic agenda” rest on the shoulders of the CEO and his management team.  CEO’s must  be committed and must commit all their resources to ensuring that the strategic agenda is realized. Beyond People, Systems, Structure, Processes – the CEO must ensure that  the culture and shared values of the organization are in sync with what is required of the strategy.

The biggest benefit of focusing on the strategy is alignment, that it creates a clearly defined common goal for both the Board and Management to have constructive engagements and allow for the productive use of scarce capital and resources.   It removes the focus away short term-ism which in every instance has given rise to crisis or crime.  Revenue and profitability, margins, customer satisfaction, etc are all measures of how well the strategy is being executed and are inputs to the discussion and not conclusions of the discussions.

Again the goal of strategy is to maximize the firms share of profits within the industry. Therefore it is implicit in the management of the strategic agenda and the execution of the strategic agenda that there is profitable growth, but all encompassing objective is to build differentiation that leads to   sustainable competitive advantage.

So, here are a few questions in poll form for you to respond to and to see how similar or different you are from all other organizations:

Should you wish to discuss the matter more please feel free to use the comments section by clicking the comment button at the top of this post or send us an email – see side bar.

 
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Posted by on June 4, 2009 in Business, Leadership