Business Success: Baker Street Irregulars

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Fans of Sherlock Holmes might remember the occasional scene in which a scruffy urchin appears out of nowhere, speaks briefly to Holmes, and then disappears again. Holmes then solves the case, and explains to the stunned Watson that he cultivated the urchins as sources of information. They are his “Baker Street Irregulars.”

For those who prefer a more recent image, fans of James Bond movies will remember the endless parade of agents who show up long enough to give Bond some critical piece of information or equipment. Unlike Holmes’ informants, the mortality rate amongst Bond’s “irregulars” tends to be awkwardly high. Star Trek, of course, was famous for its “Red Shirts,” the red uniformed security officers who would always die within minutes after appearing on camera.

In all these cases, the character shows up on camera just long enough to move the plot forward and then disappears. In a very real sense, they have no existence before they are needed and no existence after their function is fulfilled. When they are present, they exist only to meet the needs of the story, or at least of the hero.

Playing Games
Of course, these examples are all fiction. What bearing could they possibly have on reality?

When I run predictive scenario management training exercises, a type of serious game, I find the same behavior manifests: many participants tend to assume that the other players in the scenario are only there to support their goals. They don’t quite recognize that each participant has their own goals and their own needs that they are trying to meet. As a result, conflict often erupts between different individuals and groups who each assumed that the other individuals and groups were present only as “red shirts.”

Now, it might be argued that I was still talking fiction there. After all, this was an exercise, not actual performance on the job. However, the way people behave in a predictive scenario is a fairly accurate prediction of how they will behave in the workplace.

Candid Camera
Even outside the gaming scenario, I observe that kind of “off camera” behavior quite frequently in a variety of organizations. It occurs when each department treats the others as existing only to fulfill their needs. Each group becomes completely occupied with doing its own job.

This may seem like a good thing, as they aren’t being distracted by anything else. Unfortunately, they are also not considering how their actions might impact other departments or the company as a whole.

In one company, the engineering department so focused on itself that it never considered how its insular approach to the job was making it impossible for the tech writers to produce accurate documentation, or for customer service to provide useful assistance to the increasingly irate customers. At another company, attempts to identify the root causes of problems in the production process were frequently ignored by one department whose manager simply couldn’t see why she was constantly being bothered when she was clearly busy and, moreover, doing her job.

In each of these cases, the environment was intense and the pressure to work rapidly was extremely high. Unfortunately, such constant pressure leads to narrow perspectives and a decreased willingness to work with others. Although the pressure appears to be increasing performance, it does so at the cost of also increasing friction: in other words, increasing the performance of a single group decreases how well different groups work together. Instead of operating as a unified, coherent team, each company was functioning as a collection of uncoordinated groups all moving in generally the same direction. The lack of coordination led to a significant waste of time and energy and a significant increase in failure work.

Teams succeed because the members work together smoothly and well, maximizing resources and time — not by having each member duplicate the work of the rest, or treat the others as bit players who only matter when they are on camera.

Starring Rolls
The key to preventing your organization from turning into a collection of Baker Street Irregulars is twofold:

First, you need to make sure that each department and each person understands the big picture. What is the flow of information and production in your company? What does success mean, not just individually but for the company as a whole? While people do not need to know how to do one another’s jobs (nor is that necessarily a feasible objective), they do need to understand how those other jobs fit into that big picture. They need to understand how their actions and decisions affect other people, other departments, and the company as a whole. If you can’t convey that information, you will also find it extremely difficult to convince your employees to take pride in their work or in the company. People who don’t feel pride in their work or the company are also less likely to work hard, and are more likely to leave.

People also need to understand that when something goes wrong, it isn’t about fixing blame; rather, it’s about fixing the problem. What are the feedback mechanisms within the company? How are failure points identified and corrected?

Second, you need to slow down. It doesn’t help to move fast if that means errors are increasing faster than useful productivity. Coordinating different teams in a company doesn’t happen over night. Creating a loosely coupled organization — in which the different groups are cognizant of one another’s goals, and understand how to help one another — is a process. It pays to start slow, and build up speed as you go. If you start running into problems, you slow down again until things are working. Then you identify what went wrong, strengthen the weak areas, and build up speed again.

Know where you’re going. Help each person and each team know how they fit in. Start slowly. You’ll be amazed at how fast you end up going.

Stephen BalzacStephen Balzac is an expert on leadership and organizational development. A consultant, author, and professional speaker, he is president of 7 Steps Ahead, an organizational development firm focused on helping businesses get unstuck. For more information, or to sign up for Steve’s monthly newsletter, visit www.7stepsahead.com.

 

Business Success: Build an Entrepreneurial Culture

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Michael&Bonnie

The only way to survive today’s turbulent marketplace is with the help of engaged and empowered employees, say authors Michael Houlihan and Bonnie Harvey. In this article they explain “how to build an entrepreneurial culture where your employees can truly thrive.” 

Do Your Employees Think Like Owners?

Today’s companies need to be more nimble, more innovative, and more entrepreneurial — and this shift begins with employees.

But so much ink has been spilled on the need for employee engagement and empowerment that our eyes glaze over when (yet another) expert starts in on it. What we don’t know is how to effect the culture change that needs to happen—especially when the organization we lead is already set in its lumbering, bureaucratic ways.

The good news is there are some very specific steps you can take that will start the reaction shifts in your culture. It won’t happen overnight — but it will happen. You just have to take the right actions.

Be Barefoot

We know how to create engaged, empowered employees because we lived it. We started Barefoot Cellars in the laundry room of a rented Sonoma County farmhouse, and grew it into America’s #1 wine brand. We were able to do so because of our dedicated employees.

Today, we teach corporations how to infuse the principles we lived by into their own cultures, frequently consulting with Fortune 500s and other companies on how to establish and strengthen entrepreneurial company cultures.

Our new book, The Entrepreneurial Culture, explains how we kept the spirit of entrepreneurship alive in our company. It wonderfully complements the lessons from our first book, The Barefoot Spirit, and is every 21st century leader’s guide to infusing their company culture with entrepreneurial thinking.

Here are our top tips, excerpted from our latest book:

1. Hire for hustle. A great way to separate the entrepreneurial thinkers from those who aren’t is to place a special emphasis on hiring people with a sense of urgency; people who can and will move quickly; people who don’t always have to be told what their next step should be. In other words: don’t hire solely based on someone’s technical skill set — because you can always teach that. You can’t teach the other stuff—and that other stuff is what will make the difference between an average company and a great company.

At Barefoot, we had a term for that other stuff: hustle. And we devised a few methods to use during interviews to figure out who had hustle and who didn’t. For example, we would sometimes ask candidates to go out and get us some waters. We would watch to see if their actions were deliberate, determined, and focused, or unstable and slow. Another great way to judge hustle is to give them some homework. During the interview, give candidates a verbal run-down of the position, your company’s challenges, and your expectations for the position. Then, have the candidate send you a one-page summary on a deadline. This will tell you volumes.

2. Don’t skimp on training. Many companies approach orientation like it’s a formality. New employees are ushered in, given a quick tour of the office and a rundown of the benefits offered, and then they’re expected to get right to work. Well, this minimalist approach to training can have some counterproductive consequences, especially where judgment, relationships, and potential are involved.

Yes, being thorough with training will take more time, energy, and maybe even money on the front end. But the long-term benefits of making sure your people know not just the “whats” but also the “whys” of their jobs will be worth it. Here’s the thing: Professional development is an essential part of attracting and keeping the best talent. People want to stay with companies that care enough to invest in them, not just via their salaries, but by helping them develop the skills that will help them build their careers. If you’re not providing this kind of training, rest assured, they will move to a company that provides it.

3. Use performance-based compensation. When you have a compensation plan based on an hourly rate, you’re paying for attendance, not production. Regardless of how much they do or don’t accomplish, your employees will have an “I was there; pay me!” attitude…and can you blame them? However, while running Barefoot, we learned that performance-based compensation is better for everyone: you, your employees, and your company as a whole.

Here’s an example of how we made performance-based compensation work: If someone sold 100 cases in April 2000, and 100 cases in April 2001 (these numbers are unrealistically small for simplicity), their commission would be the same in both years. But if they sold 10 percent more—110 cases—they would get $1 for every case over that 100, or $10 more. If they sold 20 percent more in April 2001—120 cases—they would get $2 per case for every case over 100. Not just $1 for cases 101-110 and $2 for cases 111-120; they would make $2 for each case over 100, or $40 more. They didn’t just get higher pay for additional growth; they got the boost for all the growth. It kept multiplying. So, 30 percent more—130 cases—would earn $3 times 30 cases, or $90, and on up.

We created a pretty radical pay system at Barefoot for a simple reason. Barefoot was a small company that needed to sell large quantities of merchandise, and we couldn’t afford unproductive people. Basically, our compensation system meant that producers couldn’t afford to leave, and non-producers couldn’t afford to stay. Meanwhile, we constantly attracted new go-getters who were willing to bet on themselves.

4. Get out of their way. When your company isn’t able to meet its goals, your first inclination might be to blame your employees for being unable to execute. But you should take a look in the mirror before doling out blame. That’s because often, leaders who want to blame their employees for not executing are actually using a leadership style that is keeping people from getting things done.

Do you find it difficult to delegate important projects? Do you refuse to let their work see the light of day until you’ve personally reviewed it, leaving them twiddling their thumbs until they’ve received your feedback? Do you insist on running every new idea through legal before letting an employee pursue it? Are you a micromanager?

5. Be honest. Do you engage in any of these behaviors? If so, it’s important to stop, step back, and show your people that you trust them to make important decisions and do important work. When you do, you’ll give your team the freedom they need to help move the company forward—and you’ll free up a lot of time and energy for yourself, too.

6. Delegate effectively. There’s a misconception that many leaders simply refuse to relinquish control of any of their tasks or projects to one of their subordinates. But often, it isn’t about control at all. Many leaders want to delegate, but they don’t want it to look like they’re just dumping unwanted tasks on their employees, or they don’t feel they have the time needed to train an employee to do a task.

Here’s the first step to take when it comes to delegation: Start handing over those tasks and projects that your employees can do or can almost do without your input. Trust their expertise and trust that if they really hit a wall, they’ll come to you. Everyone has a unique set of skills, abilities, and talents. Often, your people will have firm—and sometimes surprising!—ideas about what they’d like to take on.

We’ll never forget when one of our front desk employees suggested she work in accounts receivable. We were surprised because this was the department that collected money owed to Barefoot, sometimes by people who, let’s be honest, preferred to stall. Turns out she had done similar work for her parents’ insurance company. Her insight, along with the fact that she was hyper-organized, understood people, and was charming, allowed her to excel in her new position. Within months, accounts receivable was humming, and pretty much everyone who owed money seemed unusually good about paying up.

Let information flow freely. Some companies use information as a type of currency—the right juicy piece of info can buy you lunch, help get you a promotion, bring kudos your way, or be traded for other valuable information. The flipside of this, of course, is that in large siloed organizations it’s completely normal for one department or division to have no clue what the others are up to.

Instead of a “need-to-know” policy, at Barefoot, we advocated a “know-the-need” approach. Your people are full of intelligence, ideas, and passion—you just have to unlock those things! So do whatever you can to engage your entire team and keep the information free-flowing. Of course, the most important way to achieve this is through transparency. And that means being transparent about the bad stuff, too. You may be tempted to keep bad news and problems to yourself. Don’t. Be honest about the challenges your company is facing and ask the entire staff for solutions. You’ll probably get them!

8. Don’t wait for perfectly sunny conditions. To create a culture where entrepreneurial thinking can thrive, you must make sure everyone understands that great ideas are always welcome. Then, give your employees the freedom to move forward on projects, even when conditions aren’t exactly sunny.

The truth is, if we had let our “we’ll be ready whens” dictate our business decisions, we’d probably still be wannabe winemakers. When we launched Barefoot Cellars, all we had was a laundry room to use as an office, a bank account that was running on fumes, and no knowledge of our industry. And yet we gave ourselves the freedom to take the leap. We knew the risks, but we believed in what we were doing, so we went for it.

You have to give your employees the same benefit. The truth is, conditions will never be perfect for any idea or initiative. Instead, you need to settle for “mostly sunny with a chance of showers” or even “light drizzle,” and plan to get a little wet. Keep in mind that if your employees don’t ever feel comfortable enough to share these ideas or launch these projects, your company will definitely never benefit from them.

9. Never waste a perfectly good mistake. Most leaders look at mistakes as something to be avoided, and as a result, they pass that sentiment down to their employees. But the most innovative, agile companies embrace mistakes. When you move from a culture that punishes mistakes to one that embraces them, your employees will have the freedom to take risks, and that’s where entrepreneurial thinking leads to great innovation.

When an employee makes a mistake, you want a culture that encourages him or her to learn from the mistake and change what led to it rather than a culture that encourages him to fear punishment and sweep that mistake under the rug. You want an environment where employees can acknowledge mistakes, take responsibility for them, learn from them, and then move forward.

I can’t stress enough how very important it is to investigate how and why an error occurred so that the faulty procedure or process can be fixed. That’s why Barefoot made sure employees weren’t afraid to make or report mistakes. Basically, our approach to mistakes was to say, “Congratulations! You found a new way to screw up, and that’s a good thing. We didn’t know that this could happen, but now that it has, we can keep it from happening again.” Once you’ve figured out why a mistake happened, resolve to stop playing the blame game. Instead, encourage your employees to aim their focus on what they can do to prevent the situation from reoccurring.

10. Always ask yourself, How would I like it? Relationships have never been more important. A great way to ensure everyone at your company is committed to building strong relationships is to constantly ask, How would I like it?, otherwise known as the Golden Rule for business professionals. We recommend that you regularly ask yourself the following questions and answer honestly—even if it’s uncomfortable:

• Would I want to work for an employer who treated my labor as a commodity, trying to see how little I would work for? Or would I prefer an employer who sees people as assets, rewarding them for performance and acknowledging their achievements?

• As a leader, am I open and honest with employees about where the company stands, what challenges we’re facing, and what I want?

• If I were a vendor and had two clients, one who treated me with respect and dignity, and another who viewed me as a necessary evil (and maybe even thought I was a huckster or trickster), which one would get preferential treatment? With which would I share what I know about their competition?

• Would I buy from a company that treated me like a pain in the neck if I had a problem with their product, or would I prefer to buy from a company that thanked me for bringing my concerns to their attention?

At Barefoot, we believed that customers look for overall value when buying a product, not just a low price. That’s why we turned down opportunities to cut costs and labor many times. We felt that these measures (which touched on everything from packaging to pricing to the wine itself) would reduce the customer’s perception of Barefoot’s quality. It’s also important to keep in mind that no matter what industry or field you’re in, the most critical decisions you’ll make as a leader will be shaped by your attitude toward your employees and by how that attitude affects how they treat people outside the company. So make sure the question, How would I like it? is never far from your mind.

11. Say “Thank you.” Making gratitude part of your culture plays an essential role in creating employees who feel empowered and engaged. In truth, you should be saying thank you to everyone you come into contact with through your company. Everyone, from employees to colleagues to vendors, will respond positively when you say—or better yet, demonstrate—your thanks.

But let’s take a moment to focus on a type of thanks that can really make or break your business. The gratitude you express to or withhold from your employees. When your employees work hard on your company’s behalf, they deserve your thanks and appreciation. Don’t take them for granted. Make sure your people know that you have noticed their efforts and that you’re grateful for their knowledge and help. In return you’ll gain their buy-in, loyalty, enthusiasm, and over-and-beyond efforts. Acknowledgment and validation of stellar performance breeds more of it!

Despite the chaos and uncertainty, this is a time of extreme opportunity for companies that recognize the value of entrepreneurial thinking. It is by far one of the greatest competitive advantages for companies today, and not just at the top of organizations, but at every level, from the bottom up. When you get your employees to think like owners, it will solve the biggest problem in business right now: lack of engagement. Once they see the difference they can make, everything will change. They’ll be excited to be part of the process.

———————————————
Michael Houlihan and Bonnie Harvey are coauthors of The Entrepreneurial Culture: 23 Ways to Engage and Empower Your People.

www.TheBarefootSpirit.com

Don’t lose your Connection — to your employees

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DanProsser

Are you a “Thirteener?”

Some 87 percent of businesses fail to execute their strategy each year. In this article Dan Prosser explains why only 13 percent of companies successfully execute their strategies — and why connectedness is the key.

It happens again and again: You come up with a viable strategy that you believe will fix your ailing company… You hold lots of employee meetings to talk about it… Maybe you leave fired up with enthusiasm, or maybe you harbor a nagging sense of doubt—worried that perhaps you just have the wrong people…

It doesn’t seem to matter. As the weeks grow into months, you realize that, once again, what needs to get done just isn’t getting done. And damned if you can figure out why.

You’re not alone. At least 87 percent of companies fail to execute their strategy each year. And the problem that lies at the heart of all their challenges may surprise you.

Of all the factors that impact the success of a business, connectedness is the one element missing in most of today’s organizations. If today’s leaders actually focused on building the connectedness they and their employees crave, they would see a many-fold increase in performance and bottom-line results. And you can push your company into the 13 percent of those that successfully create and nurture those vital connections.

As command-and-control management styles have become a thing of the past, the importance of connectedness has skyrocketed. Today, every company’s competitive advantage derives from how well they can innovate. Employees have to feel safe to share their ideas. Colleagues need to be able to work together to develop and modify those ideas. And no one can get there without connectedness.

• Lead: Business is actually a network of interrelated conversations. University of Houston researcher Dr. Brené Brown’s principal message is this: If you want an organization that produces breakthrough results, you must confidently lead the conversations that will bring connectedness to your company and give real meaning to the work your employees are doing.

Everything you do in your business is the result of a conversation. Each business idea you come up with starts with a conversation. So does each action you take. Conversations have within them the ultimate power to make things be the way you say they’re going to be.

Awareness: It’s critically important to create awareness around the conversations going on inside your company. I’ve seen amazing transformations happen when people uncover damaging conversations and replace them with others that build connections.

Employees are infected by hidden conversations that, together, add up to the “Execution Virus.” The greatest challenges in business today are these unseen obstacles—the limiting and negative viral conversations that infect your vision, your mission, and the strategy you’re trying to execute right now. They undermine and sabotage individual and team performance.

In my book, I present 10 conversations that regularly disrupt performance. Two of the prime ones are:

1. When your employees regularly say, “It’s not our strategy,” what they are really communicating is that they feel they have no say in the direction of the company. As a result, they aren’t engaged.

2. “We’ve always done it this way” is a common mantra. It usually indicates that people are trapped in old paradigms, unable to take action to move the business forward.

These conversations aren’t complicated. You don’t have to have training in organizational development to recognize them. However, they are the reason your employees are disconnected from you, from your vision, from your mission, from the strategy for your company, and from the needs of your customers.

 Boldly Declare: We settle for hoping when we should be declaring. There is no integrity in hope. Hoping is the antithesis of using the power of language to make bold declarations that enable bold action. Hope limits what employees are able to achieve. Instead, you must be willing to step up and say how you’re going to win. This actually invents a conversation that says, “This is how it is right now.” Then you’ll work your butt off to close the gap between what you said and where you are the moment you say it.

• Take action: There is a big difference between a conversation for action and talking about action. You can have countless meetings talking about action but because you haven’t created a “conversation for action,” nothing is getting done. Outcomes become possible only when you are willing to declare it to be possible—with absolutely no evidence that it is—and then to take the actions that are missing and that are consistent with your commitment. Your words gain power only at the moment you are willing to say how it is going to be and then take the actions to have it be that way.

• Prevent Patriarchy: Patriarchy destroys connectedness. You may think your company is not patriarchal, but chances are it is to some degree. And while the word might conjure up a dour-faced man with a long white beard sitting on a mountaintop, men and women alike are guilty of perpetuating a patriarchal style of management. Unfortunately, it creates a class divide: them and me, and as a result, erodes connectedness.

The idea that each employee has something of value to contribute is missing from a patriarchal system. Employees are never allowed to be their fully human selves; instead, a leader’s ego is inflated by marginalizing others.

On the other hand, when there is relatedness, it’s very easy for an employee to talk to his or her direct supervisor, because that supervisor listens. And there is real solidarity among executives, managers, and employees. If someone needs something, there is no problem with starting a conversation that gets the issue handled. As a result, connectedness helps strengthen the internal and external relationships that are one of a company’s most important assets.

• No safety: Connectedness can’t happen when leaders “play it safe.” Not all leaders have the courage it takes to walk into a meeting and engage others in an authentic inquiry to uncover real solutions. Instead, they choose to play it safe. When they hear an employee 20 or 30 years their junior offer a valuable insight that wasn’t even on their radar, they go into self-preservation mode. They say, “That’s not how we do it around here,” or, “That’s not good enough.” But comments like this disconnect the organization from you and employees from each other.

Real leaders are willing to “lead out loud.” This means displaying vulnerability and asking for and accepting input from your employees so that everyone can contribute to and “own” the company’s strategy for the future. For many leaders it’s scary to let employees see that you don’t have all the answers, but if you want them to commit to making your organization unstoppable, it’s critical.

If you think you have all the answers, you’re only pretending to lead. The predominant myth in business (and elsewhere) is that to be a leader people will follow, you must already “know” the answers or come with ready-made solutions to the most vexing problems your organization faces. If you believe this, you’re not leading, but pretending. And when you pretend to lead, you’re covering up something that’s missing—something that could ultimately cause you to fail.

Leadership is about stepping out of your comfort zone—getting out of the box. Until you recognize that your true value as a leader is in your ability to lead an inquiry into the solutions for your organization (and not try to provide all the answers), you are doomed to repeat your own bad decisions and those of others who came before you. To accomplish that, you have to be willing to listen.

• Take Risks: Trying too hard to avoid failure actually leads to failure. 87 percent of all companies with a strategic plan will fail to execute it. One factor that contributes to their inability to execute is a reservation to set big or “unreasonable” goals. Many business owners opt to play it safe by setting reasonable goals in an effort to avoid failure.

Most people are invested in not failing, and they’ve taught all their employees to value that course of action over taking any kind of risks that have the potential to pay off. Everyone’s doing it, and it’s costing them on a grand scale. When you set reasonable goals to avoid failure, people will make only a little extra effort—but if goals are unreasonable, people will make real changes in the way they work. Sure, it’s a risk, but in business, risk is the only way to true success.

In teaching others to let go of their fears about what might happen if they take risks, I’ve seen miracles happen. A professional services firm had an unprecedented 60 percent leap in performance in five months, for example. A creative services group went from a loss of tens of thousands of dollars in one year to a place on the Inc. 500/5,000 list and a more than 40,000 percent increase in net profit during the following years.

• Chaotic creativity: Embracing chaos is better than clinging to equilibrium. The fundamental reason why so few teams don’t make it to the finish line and execute their strategy is that leaders can’t tolerate the discomfort that comes with the chaos when things aren’t happening as planned. They can’t stay the course and wait for the source of the breakdown to reveal itself. They feel the need to act, to do something to overcome the sense of being out of control. Instead of just accepting that disequilibrium is natural, most leaders want to look for a way to create the pretense of balance.

To create an organization of innovation and creativity, you need to allow and even introduce the tension that comes with or causes chaos. Systems that are out of equilibrium are forced to explore their space of possibilities, and this leads to new patterns of relationships and structures. An organization that embraces chaos is healthier than one that hangs on to equilibrium, and it can achieve a new level of performance.

• Connect: If you’re a CEO or senior business leader with the potential for impacting the lives of others, you need to become deeply interested in the role you play in driving connectedness into your organization. You need to learn about how connectedness, and the lack of it, shapes your employees’ workplace experience and ultimately leads to the successful execution of your vision.

Connectedness even plays a key role in the primary design of your strategy—even before you have a chance to take action on it. The extent to which you can create and nurture it directly correlates to the likelihood of your company becoming a Thirteener.

About the Author: Dan Prosser is author of Thirteeners: Why Only 13 Percent of Companies Successfully Execute Their Strategy—and How Yours Can Be One of Them. He has 15 years’ experience speaking, teaching, mentoring, and coaching business leaders, entrepreneurs, and micropreneurs to cultivate an uncommon approach to building an extraordinary competitive edge. For more information, please visit www.thirteenersbook.com.

 

Business Success: Fly the personalized skies

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stefanie smith cokeSometimes a product or service has your name on it — Literally.

It happened to many of us thanks to Coca-Cola’s recent Share a Coke campaign, which reflects the global trend of customer personalization. Bottles were printed with various names on them and distributed at random, creating the fun challenge of finding your name or a friend’s name on a bottle. My friend Stefan is the cabin chief at a major European airline. He sent me this photo of a real bottle with my name on it, which is untouched and unaltered. In case you couldn’t find your name on the shelves, Coca-Cola even offers a way to create your own virtual bottle.

What’s really clever is the clear note of customization, while the product and branding remains as consistent, familiar and unique as always. The value of striking this balance between introducing specialization and maintaining standards is a challenge for all businesses.

When I mentioned this to Stefan, he replied, “Exactly. On my flight today from Chicago to Zurich, I had 229 passengers with 229 different needs.” His comment made me realize: being the in-flight service manager for overseas flights may be the ultimate intense client relationship situation. How many of us are within a few steps of our clients for 8 or 9 hours at a time?! Intrigued, I asked how he personalizes service while adhering to all the airline regulations. Stefan’s responses reflects the high-touch service many of us associate with Europe:
• Our best customers fly more than 600,000 miles per year — so, we see them more than once. While preparing for a flight, I review the passenger list so I can personally greet our top customers, and maybe even chat a little. The passengers often feel honored that someone not only asks “coffee, tea or water?” but is also attentive.
• We have to find out how people tick and what they want most. After many years, I’ve come to understand and train my staff to recognize:
– The “worker” looks at a laptop from take off to landing. Sometimes when you look at the screens, you see they’re actually playing “solitaire” but they usually don’t want to be disturbed and are very reserved.
– The “sleeper” just wants to sleep. They might eat something, but it has to be served and cleared away ASAP.
– The “communicator” likes attention and has a question every time you walk by. They especially enjoy speaking with the cabin chief, so I make sure to give them the opportunity.
• The skill for us is to find out which category the passengers belong to … because you sure don’t want to talk to a “sleeper” about the weather! A “worker” sitting next to a “communicator” is a red flag we need to notice. Of course, there are many other categories and people belong to more than just one category.

Right there, Stefan takes the concept of customer segmentation and shows us how to put it into action.

Now, for those of us down on the ground … how can we put the custom back into customer?  In your work, “customers” might be colleagues in other divisions, contacts at strategic partners, or multiple bosses. Coca-Cola is targeting a global market. You can apply the same branding genius to personalize your business for more specific individuals or groups. You may not be able to diversify bottle labels, or offer extra legroom, but you can still find out and respond to what different people want most.

For example, a longtime executive client led a large operations division, traveled constantly and always had multiple projects in play at once. It was my job to capture all cogent points and follow-ups. About a year ago, she requested I reformat our post-meeting action plans, saying, “No more than three finger slides.” By that, she meant how many times she had to scroll through her iPhone. Thanks to her, I added color, subsections and weblinks. I have been using this new format with all my clients ever since — but I vary the format according to their preferences. Guess what? They love it and let me know!

5 questions to personalize your customers’ experience

1. If you were to categorize your clients according to traits and preferences, what would be the three or five meaningful groups?

2. How could you respond differently to each group or client, while maintaining the essence of what makes your business special?
When developing customized workshops, I incorporate the organization’s mission, values and performance metrics so the participants walk out with takeaways, not theory. When they see illustrative examples tailored for them, they are receptive during the session and engaged about applying the new practices they learned.

3. What questions or opinions might you ask your customers regarding your communications, reporting or service approach?

4. How can you tailor the product or service you provide to increase the immediate and lasting value?
My client markets telephone call tracking software product targeted to global investment banks. The standard analyses show the calls made by division and region. However, with the increased awareness of Big Data, some banks are looking from a global perspective, while others seek more detailed local area breakdowns on call frequency, length, and client sector. Michael worked with the systems specialists to develop a customized reporting features to respond to his client’s divergent strategies. This added a new source of revenue, while also personalizing the product and increasing customer affinity.

5. Can you create variations on a theme to evolve the personalization concept?

The responses to those five questions will lead you to making your customers even happier when they realize: It’s not just business, it’s personal.

 

Stefanie Smith leads Manhattan-based executive consulting and coaching firm Stratex.  Her blog is at www.coachstef.com

The Engines Cannae Take Much More…

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Stephen Balzac

By Stephen Balzac

Imagine for a moment Mr. Scott giving his famous, “Captain, the engines cannae take much more of this,” line — and Kirk responding, “No problem, Scotty. You take a break and I’ll fix the engines!”

Even for Star Trek, this would be ludicrous. Kirk may be pretty smart, but he’s not the master engineer that Scotty is. It makes no sense for him to try to do Scotty’s job; that’s what he has Scotty for.

Oddly enough, Star Trek is one of the few places where this scenario never happens. Where does this scenario play out? In far too many businesses.

I am always fascinated when a manager tells me that he would never ask his employees to do something that he couldn’t do. Then what is the point of having a team? A team that limits itself to the abilities of the leader is not really a team. It’s a group of henchmen who may be good at carrying out instructions, but who are not capable of achieving high levels of creativity or performance. It would be like Kirk refusing to order Scotty to fix the engines because Kirk can’t do it himself.

In an effective team, the abilities of the team are greater than the sum of the individuals. It is the capacity of the team to work as a unit, to be able to put the right person or subset of people in the right place to deal with problems that makes the team strong. Fictional though they are, the crew of the Enterprise is an effective team exactly because they know how to put the right people in the right place at the right time. While it certainly helps to have a cooperative script writer, the fact is that the level of teamwork that they demonstrate is not fictional at all. It is something that all teams can achieve, for all that barely one in five actually do.

Specialization is beneficial

To bring this into the real world: I worked once with a software company that had the idea that every engineer should become expert in every other person’s code. Unfortunately, this was a fairly large project, and the different pieces required different areas of highly specialized knowledge. Each of the engineers had spent many years building up that expertise and could not simply transfer it to every other engineer. While having partners working together sometimes makes a great deal of sense, trying to have everyone doing everything is self-defeating. It sacrifices the benefits that come from applying specialized knowledge to specific problems.

However, this was not nearly as dysfunctional as the suggestion by one senior manager at a high-tech company that, as part of having everyone in the company better understand one another’s jobs, each person should spend time doing each of the other jobs. When it was pointed out that engineers are not always the most socially adept people, and that perhaps having the engineering team trying to market to customers wasn’t the best choice, his response was, “Then they need to learn.” When it was pointed out that marketing and sales professionals, talented as they are, generally are not trained engineers, he had the same response. Fortunately, wiser heads prevailed: while those engineers who wanted to become more involved in customer facing activities were given the opportunity to do so, the engineers did not end up trying to sell the product — and the sales force did not end up attempting to build it.

Now the fact is, this manager did have a point: Helping people become more knowledgeable about one another’s jobs is important. If you understand just a little about what other people are doing, you have a much better sense of what is a reasonable request and what is not, what you can do that will help them accomplish their jobs, and what you can do to help them to help you do your job.

Mutual aid, multiple perspectives

So how do you develop that level of mutual helping? Different people bring different skills to the project. The more people can get to know one another, to appreciate the perspectives, experiences, and ideas that each one brings, the more they will start to come together as a team. The leader needs to set the example that asking for help is not a sign of weakness and accepting help is not a sign that you can’t do your job. It is exactly because you have multiple perspectives and approaches, multiple skill sets and ideas, that the team becomes strong.

The leader can do this by, well, leading. Not by ordering or threatening or attempting to coerce people, but by demonstrating the behavior that he wants other people to engage in. The leader must be the first one to acknowledge that the reason there is a team in the first place is because the leader can’t do it all himself. If he could, why is anyone else there?

Whether it’s Captain Kirk trying to run the Enterprise single-handedly or one man trying to play all nine positions on a baseball team: a leader who can’t accept help is not a leader.

What are you doing to help your team members help you?

 

Stephen Balzac is an expert on leadership and organizational development. A consultant, author, and professional speaker, he is president of 7 Steps Ahead, an organizational development firm focused on helping businesses get unstuck. For more information, or to sign up for Steve’s monthly newsletter, visit www.7stepsahead.com.

 

Business Success: Managing to Lead

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John Tschohl

Consultant John Tschohl quotes Jack Welch as saying, “Before you are a leader, success is all about growing yourself. When you become a leader it’s all about growing others.”

In this week’s Business Success article, Tschohl talks about what it takes to lead your organization — and how it means more than being a manager.

Everyone who has a job has a manager — but does everyone have a leader?

Managers are necessary and leaders are essential. Leadership is action, not position. Just because someone is in a role of control does not mean the person is a leader.

I never hear people complain about leaders, but every day someone somewhere complains about their boss or manager. In all my years of working with top companies I find the best leaders are typically poor managers, and the best managers are typically poor leaders — but all managers have to do some leading, and all leaders have to do some managing.

Finding the right balance for the job is what is really important.

What is a manager?

Poor managers tend to not want to “shake the ship.” They conform to the rules and standards set up by the company. They are not thinkers but doers.

A good manager is responsible for controlling or administering all or part of a company or similar organization. Managing encompasses the use of company resources and good execution.

A manager is responsible for setting goals. A good manager gets employees to set goals, and makes sure that employees hit those goals. If employees fail to do so, the manager’s job is ultimately on the line. This can cause some friction and stress in the relationship between a manager and employee.

A manager’s responsibility is to legislate and regulate. A manager relies on control of every situation at all times. Budgets, hiring and firing, reprimanding, making lists, problem solving, following strict procedures, following strict rules, establishing agendas, allocating resources, planning, facilitating, establishing rules and procedures, and controlling potential risks.

Managers tend to manage in environments where there isn’t much change, and stick to the status quo.  They stick to rules and procedures, and are uncomfortable working outside of those boundaries. Managers tend to be reactive and avoid conflict. Employees are unable to make empowered decisions because they are being managed, not led.

Managers often do NOT work well with others. They implement their own guidelines and expect others to follow. Their main objective is hitting goals. Managers are guided by numbers and outcomes. Their main goal is to keep the machine moving along.

What is a Leader?

A leader is completely different from a manager.

Leaders do not just do things right — they do the right thing.

Leadership has been defined as a process through which a person influences and motivates others to get involved in accomplishment of a particular task. Leaders are cheerleaders and don’t mind other people getting the credit. A leader coaches, inspires, copes with change, has relationships with others, develops people, fixes break downs, gives credit, genuinely wants people to succeed, creates and seeks opportunities, challenges the status quo, innovates, originates… Again, the list goes on.

Leaders are rare. Unfortunately, the majority of people will never work for a leader.

I have found that leadership is the essential tool for commitment from employees. Without a leader, employees lose hope — and their commitment to the company is drastically reduced. It’s not that they don’t want to do better, it’s that they have no one to inspire them or encourage them to do so.

Companies today hug the philosophy of management. They have forgotten what leadership is. Without leadership, all else is lost. Wars are not won on management alone. A leader is essential to inspire an organization to go beyond what they thought possible and to believe it is possible.

From management to leadership

You can build leaders by helping managers develop their leadership skills.

In most firms, we are dependent on people to deliver the product or service. They are not machines — they are fragile human beings who want more than a pay check. They thrive on recognition. Employees work harder and more effectively for leaders than managers. Employees become more indispensable and extraordinary.

Great leaders move up. Learn how to become a leader. Develop your entire leadership team from top to bottom.

John Tschohl is president of the Service Quality Institute in Minneapolis, Minnesota. His books include the new 10th edition of Achieving Excellence Through Customer Service.

 

Innovate: Stop Six Sigma from stifling you

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Lean, Six Sigma, and other operational excellence initiatives have become incredibly popular in recent decades — and for good reason. But this quest has a dark side: it can stifle innovation. Edward D. Hess shares five ways to ensure it doesn’t.
                                                                                                                                                      

 

Many top organizations have embraced Lean and Six Sigma over the past couple of decades, and no wonder — There’s something so appealing, so elegant, about the concept that drives these systems: Take what we already know, replicate it, improve it, and repeat.

It’s so easy a robot could do it — and that’s precisely the problem: Very soon the tasks that Lean and Six Sigma have helped operationalize will be handled primarily by robots and smart machines.

But: That’s a good thing. Nothing beats a robot in terms of efficiency and perfection.

Here’s the real question: How good is your company at doing all the things robots can’t do well—such as innovate?

The only real competitive advantage these days is the ability to learn and innovate. That means your organization must be okay with risk, and the screw-ups, missteps, and waste that inevitably accompany it.

The problem is that an organization steeped in the lore of Lean and Six Sigma naturally views them as sins to stamp out.

So am I suggesting we abandon the quest for operational excellence? Well, no. We must allow Lean or Six Sigma or whatever operational excellence system we follow to coexist peacefully with a deep desire to learn and try new things, even when the outcome is unknown.

Yes, it’s a paradox. But it’s one that must be hardwired into the fabric of an organization through a learning culture, because learning is the fundamental process that underlies both operational excellence and innovation. Lean and Six Sigma just need to happen in the context of a hybrid business model, one that also prioritizes the need for innovation while keeping in play the best aspects of operational excellence—for example, its focus on relentless, constant improvement.

If you want to survive the coming Digital Age of Machines (a.k.a. the 21st century), you must create a learning environment.

As we noted here on January 20, some key elements are giving employees permission to try and fail, and shifting leadership toward “coaching-ship.”

Other key ideas:
Allow the best ideas to rise to the top.
In an idea meritocracy, the best ideas win out regardless of the position held by the thinker-upper. Innovation and creativity are what matter, not hierarchy.
Google has successfully built an idea meritocracy to drive innovation and experimentation—in other words, trying new things. To support this culture, pay level is irrelevant in decision making, and so is experience or tenure—unless the experience provides data used to frame good arguments. In fact, Eric Schmidt, Google’s chairman, stated in the book How Google Works that Google employees are told not to listen to “HiPPOs,” or the “Highest Paid Person’s Opinion” just because of their position.

Make candor with a duty to dissent the gold standard.
Operational excellence can lead to command-and-control, hierarchy-based cultures. Unfortunately, these cultures have a tendency to stifle dissent and limit learning.
At Google, employees have a duty to dissent. This means that relative “rookies” can—and do—raise objections and present alternate ideas when they disagree with their bosses. A similar duty to dissent can be found at UPS, which has an employee-centric culture of “constructive dissatisfaction,” meaning that everyone has the duty to find ways to improve.
Candor and permission to speak freely without fear of punishment are critical to becoming an innovative organization. This is evidenced at Google, Bridgewater Associates, Pixar Animation, and W.L. Gore & Associates.

Teach employees how to overcome their weaknesses.
We cannot learn when we constantly seek to be right, actively avoid the risk of making mistakes, or ignore those who disagree with us. Employees must work around these human tendencies in order to become better thinkers, learners, and in turn, innovators.
We are sub-optimal learners. In order to learn, we have to be open-minded and be willing to constantly stress-test our beliefs against data and we need to really listen to people who disagree with us. In other words, we have to be willing to be wrong! Overcoming the strength of our ego-defense system requires management of our emotions and quieting our egos. We need to decouple our beliefs (not values) from our egos. We are not our ideas. Yes, in order to optimize the “good” things our human brains can do, we must overcome the “bad” aspects of our humanness. That requires a learning culture and the rigorous daily use of best thinking, listening, and collaborating processes.

Ultimately, Lean and Six Sigma systems thrive on eradicating variance. Innovation, on the other hand, thrives on variance. Reconciling that difference along with the different tolerances for failure can be achieved under an umbrella learning culture.

I believe that technology advances will commoditize operational excellence, making innovation the key organic growth strategic differentiator. That means the organization of the future has to be both operationally excellent and innovative. That is made easier with a learning culture.

EdHess• Edward D. Hess is a professor of business administration and Batten Executive-in-Residence at the University of Virginia’s Darden School of Business. He is the author of 11 books, including Learn or Die: Using Science to Build a Leading-Edge Learning Organization.

Independent retailers compete with big box stores

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“Like it or not, if you’re a small business owner you will have to compete against big box merchants,” advises Forbes. “You’re store is bound to battle retailers larger than life – so to speak – or at the very least, with larger budgets and more man power than your small biz.”

However, the new article adds, “as an indie specialty retailer, you have countless advantages over big box stores.” Among the areas to concentrate on are customer service, inventory, and employee representation. “Here how these factors can help you combat your big box competitors.”
The full story is here.

Business Success: Build that Blog

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Mark Satterfield

What is a blog? A webpage that is easy to update with new content that flows into a consistent format for a professional appearance. Why would you want one? A blog can be a low-cost way to reach out to potential new customers, and regularly stay in touch with current ones to encourage repeat business.

Publishing an online blog can be almost free, with many  sites offering to host at no cost. But doing it wrong can indeed cost you and your business — and this week consultant Mark Satterfield offers eight tips on how to do it right.

 

Eight Tips for Building a Successful Business Blog

Anyone can type words into an online template—but making sure they’re words that strengthen your brand and attract customers takes know-how and skill to successfully showcase what you know, what you think, and why prospective clients should do business with you.

These days, it seems business blogs are everywhere. And why not? They’re simple to set up, and they’re a great way to promote your products and services. But here’s the real question: Do they get results?

Only if you do them right. While anybody can type words into a template, it’s not so easy to create a professional blog that reels in potential clients and keeps current ones engaged. You have to strike the right tone, come up with great topics, know how to hold a reader’s attention, and more.

Most compelling business blogs have several structural elements in common—and once you know what they are, they’re fairly easy to replicate. Done well, your blog can become an essential component in your marketing arsenal.

Blogging can be a valuable way to establish yourself as a thought leader. Each time you publish a post, people searching for any keywords it contains will be drawn to your site, where they may sign up for your email list and buy your products or services. And it’s easy for readers to pass along interesting or controversial posts to their friends, fans, circles, and followers.

I recently acquired a major client all the way from Australia because of a blog post. And my dentist says she gets a new patient for every few blogs she posts—and those are only a few examples. So yes, the time, thought, and energy you put into strategic blogging can have an incredibly positive ROI for your business.

In my  book The One Week Marketing Plan, I share actionable strategies and real-world wisdom to help entrepreneurs set up a successful, sustainable niche marketing plan in just five business days. (Yes, really!) Here, I spotlight eight tips that will help you create a compelling, business-driving blog: 

1. Know what your readers care about. First and foremost, successful blogging is all about offering value to your readers. It doesn’t matter how flashy or funny or well-written your posts are if they don’t provide useful information or answer readers’ questions. People aren’t interested in self-serving pontification; they’re looking for resources to enhance their lives. Keep this principle firmly in mind when considering all of the following tips.

Specifically, I advise you to not only consider what your target audience cares about, but also to think about the words and phrases they’re likely to use when searching for that information. Be sure to include these keywords (judiciously, not exhaustively!) in your headlines and copy so that your posts will be more likely to show up in the first few pages of search results. This is one component of search engine optimization, or SEO.

2. Find your voice. (And make it an engaging one!) If your goal is to drive readers away or put them to sleep, write in dense “corporate speak” and use a lot of industry-specific, arcane phraseology. Oh, that’s not your goal? Then the tone of your writing should be more entertaining and approachable, even though you’re primarily talking about your business.

If you read your blog post aloud and conclude that your words would turn an in-person meeting into a snooze-fest, think twice before hitting “publish.” In fact, when you’re creating posts, aim for the tone you’d strike in a one-on-one conversation with a prospect or customer you already like.

3. Banish blogger’s block with a list of compelling topics. Consistently creating compelling content is a challenge for a lot of bloggers. So that you don’t find yourself facing blogger’s block, it’s smart to have a broad understanding of what readers generally find interesting.

I suggest making a list of posts you want to publish so that you can work on them when inspiration strikes (and so that you can have a lot of content in the can for a rainy day!). Be sure to keep a constantly evolving record of any new ideas that come to you. I use a program called “Evernote” that enables me to keep all of my ideas readily available.

4. Tap into current trends. “Google Trends” (http://www.google.com/trends/) is a valuable tool that lets you know on an hour-by-hour basis what the most popular searches are. If you write a timely post centered on one of these trends, you may get a quick traffic boost to your blog.

 As a busy business owner, you can’t constantly monitor Google trends, ready to churn out a relevant post. But whenever you can link a trend to your business, do so. Because it is a trend, you know it’s something many of your readers are already interested in and familiar with. Think of it as a topic “freebie.”

5. Get (somewhat) personal. Just because it’s a business blog doesn’t mean it has to be all business. Sharing select details about your personal life can get you a lot of mileage because it accelerates the “know, like, and trust” factors that are crucial for building relationships. The trick is to relate these details to your business—like the vacation you just took to the Bahamas, where you collected shells on the beach with your daughter, which reminded you of an important premise you wanted to share with your clients.

Or it could be the movie you just saw, the restaurant you just ate in, or the conversation you just had with a client. Sprinkle these moments in from time to time, and your blog will have plenty of personality—trust me! Recently, I was creating a video blog and had just recorded a great take, only to find that my cat Sam had walked across the back of the sofa I was sitting on, stopped above my head, yawned, and then walked off. Part of me thought I should do this over again. But instead, during the editing process I inserted a card that read, “Well, that wasn’t very professional, was it?” after Sam made her appearance. Suffice it to say, the response was much greater than normal, and somewhat to my surprise, universally positive. Granted, I wouldn’t do this every time, but it does underscore the benefits of of not taking your work or yourself too seriously.

6. Channel your inner Seinfeld or Silverman. Your readers probably sought out your blog post because they were looking for specific, maybe even technical information, insight, or advice. But that doesn’t mean you should shy away from humor, whether it’s tame or even slightly risqué. Like most humans, your readers will appreciate a good chuckle—and more to the point, they’ll be more likely to remember your business because you made them laugh.

You know your target audience and what they will generally respond well to, so trust your instincts and adjust your approach going forward if need be. Just keep in mind that your primary function isn’t to be funny, and always bring the joke back to business.

7. Watch your word count. In general, try to write posts that fall between 300 to 500 words. Many social media experts agree that 300 words is the minimum number necessary to get SEO benefits for your blog. (In other words, don’t count on shorter posts to affect your ranking in search results.) And once you go past the 500-word mark, you may be in danger of “losing” some readers’ attention.

We live in a fast-paced world, and on the Internet especially, there are endless shiny objects that can “steal” a reader’s attention. That’s why it’s important to hone your ability to say something of substance succinctly. If you do need to use more than 500 words, break your post up into Part I and Part II, using the same headline. You’ll get twice the SEO bang for your blog!

8. Give them something to look at. We live in a visual culture, so spice up your posts with pictures. This will make them more interesting and memorable to readers. But don’t rely solely on stock content; post original photos or graphics from time to time and caption them with SEO-friendly keywords, which will boost your blog’s rankings.

If you’d like, you can even embed videos in your blog posts. Whether you’re sharing a clip that showcases a product you just launched or videoing yourself talking directly to the viewer about a topic of interest, visitors to your blog will appreciate the multimedia approach and may share your videos with their own circles.

If you follow these guidelines, you’ll maximize your chances of bringing all kinds of new people into your business life, while also (hopefully!) having fun. And best of all, the power of writing a regular blog goes beyond building a brand for your business and attracting new clients. If you do it consistently, your blog becomes a powerful tool for cementing relationships with your existing clients and thwarting the attempts from your competitors to poach them.

# # #

 — Mark Satterfield is the author of The One Week Marketing Plan: The Set It & Forget It Approach for Quickly Growing Your Business. He is the founder and CEO of Gentle Rain Marketing, Inc.  To learn more or to receive weekly email tips for growing your business,  visit www.gentlerainmarketing.com.

 

Business Success: Don’t die, dummy

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learn or die

Today, the only way to develop and sustain a competitive advantage is to create a “learning organization.” This week “Learn or Die” author and business professor Edward D. Hess shares four key ideas for transitioning your company into one that succeeds by getting smarter.

The Learning Curve

You know your business’ survival and success depend on maintaining a competitive advantage, so you’re constantly focused on reaching more of your target market, making your product that much better, and expanding your services…

Those are great strategies to drive your goals — if you have a time machine and are doing business in the previous century.

But today? Technology has reduced the capital needed to start and build businesses, reducing an historical barrier to entering the marketplace. And new competitors can reach your customers from thousands of miles away. Technology has also given customers tremendous power in comparison shopping, and telling the world how happy or unhappy they are with your product or service.

That doesn’t bode well for the staying power of the better mousetrap you’ve just built (or for the lifespan of your company, or for your job security). Standing still is a losing strategy in many cases.

To stay relevant, companies can no longer rely on traditional competitive advantages like location, capital, lack of choices for customers, and lack of market transparency; instead, they must transform themselves into “learning organizations.” Today’s technological and marketplace developments necessitate faster adaptation, and adaptation requires institutional learning processes such as critical and innovative thinking, critical conversations, and experimentation.

In other words, the only way to sustain a competitive advantage is to make sure your people have the tools, motivation, and support to learn better and faster than your competitors.

In my book Learn or Die: Using Science to Build a Leading-Edge Learning Organization, I share my complete formula — and here, I spotlight four key points to keep in mind when building a learning culture.

1. Leadership must shift toward “coaching-ship.”

Unless you’ve been living under a rock, you know that command-and-control structures — with leaders who think management’s job is to use rewards and punishment to direct, motivate, control, and even modify employees’ behavior in order to get organizational results — are on their way out. If we want adaptable learning organizations, we need to humanize our management models, and that requires many leaders and companies to fundamentally change their attitudes and behaviors toward employees.

Personal and intellectual humility, empathy, emotional intelligence, and self-management are now required leadership capabilities, because these qualities nurture the very human capabilities that are at the root of adaptation and innovation: the ability to ideate, create, emotionally engage, and learn — all while in conditions of uncertainty, ambiguity, and rapid change.

Instead of “knowing and telling,” which can cause progress-limiting dependence, leaders should work with employees as coaches, or even allow them to experiment on their own. I recommend following Intuit’s example by consciously choosing to bury the “modern-day Caesar”—the kind of boss who gives thumbs up or down on all decisions. In India, this policy allowed young Intuit innovators to conduct an experiment on helping farmers get the best price for their products, even though management initially wasn’t interested in the idea. The result: 1.6 million Indian farmers now use the successful program these innovators developed.

2. Your work environment must be an emotionally positive one.

Positive emotional work environments are no longer negotiable. They’re a requirement.

Positive emotions are associated with openness to new ideas, better problem solving, openness to disconfirming information, less rigid thinking, resilience, creativity, collaboration, better recall of neutral or positive stimuli, and mitigation of ego defenses.

Negative emotions inhibit all of these things. A positive emotional state is essential to developing employees who are motivated, productive learners.

If you feel building a positive workplace environment is too “soft” to suck up your organization’s limited time and energy, consider that none other than the U.S. Army has recently begun an initiative to promote positive psychology. The training includes learning about emotions and their effects on the body and mind, learning how to manage emotions, reducing the frequency of negative emotions, and increasing the frequency of positive emotions. It’s directed toward producing soldiers and leaders who can adapt to new and challenging situations and uncertainty — that is, learn. Your people may not be tested on a literal battlefield, but these skills will still be crucial in helping you maintain a competitive advantage as your organization navigates the cutthroat landscape of the global marketplace.

3. High employee emotional engagement is a necessity.

It stands to reason that if employees don’t have an emotional investment in your company and their future in it, they won’t be motivated to learn. But how do you transform “engagement” from a meaningless buzzword to a reality? The research of Edward L. Deci and Richard M. Ryan and their Self-Determination Theory shows us it comes down to meeting employees’ needs for autonomy, effectiveness, and relatedness. And these needs are most likely to be met when individuals feel respected, trusted, and cared for, and feel that they can trust the organization and its leaders.

These concepts are easiest to understand when you look at them in action, and UPS is one of the best examples out there for operationalizing emotional engagement. Founder Jim Casey viewed employees as partners, and maintaining his values over the decades has led to policies that are employee-centric and hold management mutually accountable to employees: an egalitarian “open door” policy for employee input, an employee “free agent” program that allows any UPS employee to move anywhere in the company and advance, mentorship and training programs, and more. As a result, UPS has maintained a high retention rate and built a deep bench of long-tenured, adaptive employees.

4. Employees need permission to TRY and FAIL.

Abraham Maslow aptly stated that an individual would engage in learning only “to the extent he is not crippled by fear, and to the extent he feels safe enough to dare.”

Building that type of environment requires many companies to adopt different mindsets about “mistakes” and about what “being smart” means. Learning is not an efficient 99 percent defect-free process — far from it. So mistakes have to be valued as learning opportunities. Employees must be given conditional permission to fail within proscribed financial tolerances, with the knowledge that they won’t be punished for their mistakes so long as they learn.

Some companies are already on this journey. Bridgewater Associates, the biggest and one of the most successful hedge funds in the world, is passionate about the power of mistakes. Bridgewater actually encourages employees to get excited about their mistakes because each error that employees learn from will save them time, energy, and stress (and the company money) in the future. Employees are instructed not to feel bad about their mistakes or failed experiments, or those of others. Acknowledging mistakes, confronting weaknesses, and testing assumptions, the company believes, is a reliable strategy for long-term success.

Another company that puts the permission-to-try-and-fail principle into action is W.L. Gore & Associates, Inc., which is known for manufacturing innovative products like GORE-TEX fabric. All associates are encouraged to experiment using the “Waterline Principle.” There’s an understanding among the associates that if they see a need, and failure isn’t going to sink the entire ship, they should just go do something about it. If it does look to be risky, however, consultation with other associates is required before taking action.

Transformation at the Top

One final point to keep in mind: Transforming an existing organization into a learning organization requires the change starts at the top.

If you’re a leader or manager and you want to change your organization, the best advice I can give you is to change yourself first. Good intentions are not enough. Behaviors are what count.

So role model how to think and communicate better. Admit your ignorance and your mistakes. Be authentic. Act with caring humility. Engage people so they feel like they have some control over their destinies. Be honest, have high standards, and hold everyone, including you, to those standards.

Only then will you earn the enthusiastic buy-in of your learners, and set the stage to build and sustain a competitive advantage.

EdHess• Edward D. Hess is a professor of business administration and Batten Executive-in-Residence at the University of Virginia’s Darden School of Business. He is the author of 11 books, including Learn or Die: Using Science to Build a Leading-Edge Learning Organization — Columbia University Press (September 2014).