Topic: Leadership

I talk a great deal about visions.  About how they should drive organizations, about what they should contain, and about the importance they have on the effectiveness of teams.  I see many cases of strong, clear, focussed visions leading to great success.

And I see the opposite.  I see organizations that either lack a vision, or that don’t measure operations against the vision on a regular basis.  I have two examples right in front of me.

Both examples are from the software industry and both show how easy it is to get distracted from the main point of the company and off to “the plumbing”.  It’s a tale of my trying, seemingly in vain, to simply purchase two different companies’ products.

I have had, since youth, a deep interest in photography.  And I have owned, in recent years, a parade of better and better photo printers.  When I decided to donate two of my older printers to my children’s school, I found that it was a case of “you can’t get there from here”.

You see, both printers were driven by software called a RIP (raster image processor).  RIPs are sophisticated programs that control, to minute detail, the output of the printers.  They insure that what you see on the screen, ends up on the printer.  Sure, you can just press “print” from within your program, but for best results you use a RIP.

There are a number of these programs, and they are all absurdly expensive.  The license for these two printers was several thousand dollars (ouch!).  So when I decided to donate the printers, clearly I wanted to donate the RIP to drive them.  I wouldn’t want the school to have to pay for them.  So began my ordeal.

You see, the licensing is obtuse, and is controlled by a tiny (the size of about 6 dimes stacked up) device called a “dongle”.  You need the dongle plugged into your computer to run the program.  This is a silly form of copy protection.  I emailed the company and explained what I wanted to do.  It went south from there.

Colorbyte explained that would have to return the dongle (to Florida), pay hundreds of dollars, pay for shipping both ways, and so on.  I pleaded for mercy, this was merely a donation, perhaps they would want a charitable write-off too?  I exchanged 8 emails, and had five 20 minute phone calls with the sales manager.  In the interim I lost, and later found the silly little dongle.  I offered to handle the case in any number of ways.  I even agreed eventually agreed to their terms, and they suddenly changed the terms.

Eventually, I gave up.  I convinced my local dealer to sell me the competing product at cost (and take a write-off for the balance).  Colorbyte set up so many hurdles they lost an upgrade sale — and ongoing maintenance updates from the school, no doubt.  And undoubtedly cost the company many times the profit they ever made on me just from the time the sales manager spent handling my case.

I’m not alone.  Reading the support forums for their software, Colorbyte’s confusing and obtuse licensing, and this ridiculous little device, cost their customers hours of frustration.  The dongle drives people nuts, and makes all the customers feel like criminals.

Colorbyte’s vision clearly wasn’t to create hurdles for their customers, it was surely to create the best RIP they could.  But their tech support time, their sales time, and I’m sure their software development time, has been sapped by the silly paranoia about software theft.  This clearly costs the company in the long run.

My other experience involves the venerable giant of the graphics software industry, Adobe.  Makers of Photoshop, Illustrator, and a number of other high-end graphics arts tools, the company has been a software industry stalwart for decades.  Simply put, if you are really concerned with the quality of your graphics, you use Adobe’s products.

But the company’s vision of creating the world’s best graphics software and serving the graphics professional, which has served them so well, clearly doesn’t extend down to the licensing department.  Buying Adobe’s products has always been hard.  And I have the wounds to prove it.

Adobe has always charged far above any comparable product for their software.  And because they make the best products, people pay the price.  But along with this premium strategy (high price, but you get what you pay for) should come good service, respect for your customer, and a certain amount of benefit-of-the-doubt thinking.

But, no.  Adobe, you see, is paranoid too.  Because their products are out of the reach of the non-professional, they get stolen.  Probably a lot.  So Adobe has complex licensing and authorization hoops to jump through when you buy their products.  And their licensing people are ruthless, and treat every customer as a potential criminal.

I’ve just hung up the phone from a 54 minute phone call with Adobe customer service.  My seventh such phone call in the last month.  All because I wanted to buy their latest upgrade.

But I made it hard, you see, because I recently switched from Windows to the Mac.  This makes it a “cross-platform upgrade”.  And apparently something really hard to do.  I had to sign and fax in three different affidavits, certifying that I’m going to destroy the old versions.  I had to pay for the new version in advance.  And I apparently had to wait.

I placed the order and jumped through all my hoops, five weeks ago today.  I still have nothing to show for it.  In the meantime, I’ve called customer service seven times, each time having more hurdles tossed in front of me.  All for this seemingly simple $399 purchase — a purchase every other company would let me do online and download the software immediately.

Each time I call customer service, I find that the purchase has been stopped on another bureaucrat’s desk.  Each time, no one bothered to tell me.  Each time, I had to call, wait on hold, wait while some poor sap in Bangalore looks up the information, only to find that somehow the purchase failed to meet some ridiculous test.  Last Friday, after another hour of hoop jumping, “Jen” promised me it would be expedited, and shipped overnight.  She promised to email me the status immediately.  I never heard from her again.

Today, “Frank” spent 54 minutes looking up my order, and eventually gave me a tracking number for DHL.  A number DHL says does not exist.

And amazingly, I just got a call from “Jen” at Adobe to tell me that the heavens have opened and the product has shipped.  Ground, not overnight.  I should see it in 7 - 10 business days.  Almost seven weeks after this simple purchase was made.

Clearly, Adobe, like Colorbyte, has lost all profit from this sale.  Even at the rates of customer service in India, the phone charges, overhead, and pay to “Frank” and “Jen” has to have made this sale a total loss for the company.  And has left them with a thoroughly upset customer.  And as the old adage goes, “a happy customer tells a friend, an unhappy customer tells everyone they know.”

In the end, Adobe has probably lost site of their vision, just because of all this paranoia.  And all because people who wouldn’t buy the product in the first place are stealing it.  There is no lost revenue here, the thieves never could afford it, and people who make their living with it happily pay for it.  And perhaps, when they grow up and can afford it, since they’ve been using it, the thieves would buy it.  But they have to jump through the hoops — maybe it’s easier to steal it.

Both of these companies forgot why they got into the business — to create great software.  They let paranoia over come them, and let their lawyers or “compliance people” rule the day.  They forgot customer service, and respect for their customer.  They forgot their vision.  And they are much the worse for it.

Like many police departments these days, Seattle’s is under fire for the handling of a number of incidents, and the possibility that the officers overreacted.  I’m not going to dive into the depths of the argument over individual cases.  It is so hard to be sure of the facts, and all sides immediately jump to polar positions.  No, I’m more interested in the effect this has on the department and its leadership.

Unfortunately that effect is not good.  And it’s not at all assisted by the Chief, Gil Kerlikowske, who has spent the last few weeks angrily lashing out at the various review boards that have criticized the department and specifically his leadership of it.  His reaction has been shrill, and embarrassing.  It’s achieved a level that the only reasonable result can or should be his resignation.

But then today comes the Seattle Post-Intelligencer with an interesting article about this issue.  In the article entitled “Few police officers trigger complaints” the Police Officer’s Guild (the union) attempts to shine a good light on the department.

Their main point is that, in a department of over 1200, something around 10 officers get more than three complaints a year.  That’s less than 1%, they argue, and that shows this is a good department.  Their point is that everyone should get their knickers out of a twist, this just isn’t that big of an issue.

In some sense, they are right.  This is a small number, and we shouldn’t overreact.  However, to me, this is just a leadership problem…  and a union problem.

You see, I’m a strong advocate of losing the bad apples promptly.  I have always advised leaders to cut their losses, and to escort the poor performers, the troublemakers, and the bad attitudes quickly to the door.  And choose again from the barrel of apples.

I always tell managers: “wouldn’t you like to be done with this problem, and have a chance at getting a superstar in the exchange?”  Imagine life without the hassle of this person, and with the true possibility that you replace them with someone who could really light the place on fire.  Most managers with whom I have this conversation realize the logic immediately.  Their eyes glaze over and they dream of life in the post-hassle era.

I even advocate moving on from the only average performers. “Wouldn’t you want to change that C player for a chance that you could get an A+ player?”  As long as you hire carefully, make decisions quickly, and cut your losses often, you’ll end up with an A team in no time.

In the case of the Seattle Police Department, my question after reading this article, is “why the heck do these officers still work there?”  Move them on.  Choose again from the barrel of apples.

I’m not advocating firing officers who get any complaints.  Clearly some complaints are baseless.  But when only 13% get one complaint, fewer still get two, and only 10 get three or more, the course is clear.  Move them on.  I don’t even care if these complaints are questionable.  By the time you get three complaints, something is wrong.  Where there’s smoke there’s fire.

And this is especially true when there are people lining up to be police officers.  They got 1200 applicants for their last police academy class.  Surely somewhere in that mod are some truly good apples.

The stickler in all this, of course, will be the Guild themselves.  They have, no doubt, negotiated a terrible contract where firing someone takes years and something just short of an act of God to accomplish.  They should be embarrassed themselves to be creating an environment where these bad apples can sully the reputation of the whole department.

But the lesson here is clear, if you are spending time managing the bad apples, lose them and choose another from the barrel.  You will thank me for it.

Mike Hargrove, the manager of the Seattle Mariners walked into work this morning as said “today is my last day as manager of the Seattle Mariners”.  To say this was a shock would be a vast understatement.

The thing that was most curios about the announcement was his reasoning.  He said: “It was just getting harder and harder for me to get up for the games each day.  I still could, it just took me longer than I would like.”  When asked if he had “lost the fire for baseball”, he quickly replied “no, that’s not it.”  In fact, other than this curious problem of getting motivated, he said essentially nothing.  He’s just leaving.

Aside from my admittedly partisan view of the team, the thing that most bothers me about this is what it says about the organization and/or Mr. Hargrove.  The team insists that they didn’t push him, and in fact begged him to stay.  What team wouldn’t?  Finding a manager before the All-Star Break is just a nightmare.  So that leaves us with Mr. Hargrove.

Lacking a family member in immediate peril of death, there’s really no excuse for this behavior.  Unless the working conditions had become terrible, the situation so untenable, that he simply couldn’t walk into work, there’s just no way to justify leaving a job on 24 hours notice — especially a job like this.  This job has annual contracts, a defined start and end to each year.  What could possibly so bad that you couldn’t just grind it out for the balance of the year?

The most curious thing is that the team is hot.  They’ve won seven straight.  They are 11 games over .500 baseball.  They’re on track for their best record in the last 5 years.  He turned the team around, he’s just starting to look like a guy who knows what he’s doing.  Then he quits.  Ugh.

I’m sure we’ll find out a lot more about this in detail in a few weeks.  He’ll eventually tell somebody the true story.  And I sure do hope that it’s because the management is totally screwed up and the organization is a mess.  At least, there’d be a good reason.

Because if that’s not it, it shows an incredible lack of class, judgment, and guts.  I’d like to believe he’s a better guy that that.

Update: After listening to his press conference, and post-game interview (they won, BTW), I’m convinced what happened was an ultimatum.  I’m willing to bet dollars to donuts that Mr. Hargrove deeply objected to some move/trade (trading Ichiro? bringing back Ken Griffey Jr.?) and said, “if you do that, I’m outta here.”  They did it, he’s gone.

After the trade deadline, and whatever move is announced, I’m sure we’ll hear Mr. Hargrove’s real reason for leaving.  Ugh, again.  I hate this kind of thing.  It just ruins the entire organization’s morale…

A good friend of mine is part of the senior management team for the Boeing 787 “Dreamliner” project.  As a student of project management, I love to catch up with him every now and then to discuss this unbelievably complex endeavor.

While I’ve been up-close-and-personal to tremendously large and complex projects (like Windows NT) involving thousands of people and hundreds of thousands of variables, nothing can compare to the development of a new commercial airplane.

Just imagine hundreds of thousand of parts, some larger than a football field, some smaller than the tip of a pen, and all being built (especially for this project) by suppliers located around the world.  Stir in tens of thousands of people, billions of dollars, and oh yeah, don’t forget that peoples’ lives are at stake, and you have a recipe for a project management nightmare.  And my friend’s job is a key position in the coordination and assembly of all these various parts.  With the plane scheduled for its maiden flight in a few months, he’s having a lot of fun these days.

One of the things that Boeing and many other companies have long struggled with is delivering the best product they can build while simultaneously pleasing their customers.  With previous airplanes, Boeing has let customers design their own interiors, galleys, bathrooms, overhead storage, seats, avionics (cockpit controls), and so on.  The company essentially offered a shell that flew and let customers make the inside to suit their needs and taste.  This explains why your carry-on fits in some overhead bins and not in others.  Each airline chooses their own style.

This approach was remarkably customer-friendly, but it exponentially increased the complexity of building aircraft.  With every airline choosing different configurations, each plane — even each bathroom, was custom made.  At most they would see a customer order 10 or so planes with the same configuration.  Imagine the pain that Boeing and its suppliers would be in never getting to scale up production for even the soap dispensers.  And try to imagine the complexity of assembling and testing these incredibly complex machines, each one different from the next.

This was all supposed to end with the 777 model a few years ago.  My friend was told repeatedly by management that customers would be given only a few choices to make for each item, and that configurations would be standardized.  But then the sales team began selling the planes.  And customers began expecting the same custom-built planes they always had in the past.  The sales people had a hard time telling a customer who was placing a multi-BILLION dollar order, “no, you can’t have fries with that”.

Pretty soon, the number of bathroom configurations mushroomed from 4 to 40, and they were back where they started.  The 777 is widely different when flown by United than when flown by British Airways.  It’s a complex and difficult product to build and test.  And it’s nowhere near as profitable as the company had hoped it would be.

For the 787 project, to quote Bullwinkle J.  Moose, “This time for sure!”  This project is made significantly more complex by the choice of vendors quite literally from around the globe.  Parts are being made in Italy, Japan, and all over the US.  To allow customers to choose from an infinite variety of configurations would be a potential coordination disaster.  So with this plane the company is being far stricter about forcing customers to stay “on catalog”.

In fact, my friend leads a weekly meeting they call the “no” meeting.  Sales people from all around the globe call in trying to convince manufacturing to build just this one custom part for this very special customer.  And the answer is always “no”.  They push the sales person to escort the customer back to the catalog.

And you know what?  The customers are fine with that.  The 787 is the fastest selling plane in commercial aviation history, with almost 600 orders before the thing has even left the ground [pun intended].  Turns out customers recognize the value of standardization in cost savings, quality, training, and time to delivery.  They didn’t really need custom soap dispensers, they were just pushing as far as they could, because they could.

So far the “no” meeting has held, except for one special case.  The galley carts (you know, those knee bashing things they drag up and down the aisle) are customized.  You see, the airlines already have thousands of them, with each airline’s different from the next.  Boeing just couldn’t tell them “no” in this case.  So they’ve built adapters to make the standard galley accept your special cart.  But they’re holding the line everywhere else.

What’s the leadership lesson here?  The same lesson I preach about all the time: have a vision, stick to it, and sell the heck out of it.  Your team will love you, and customers will beat a path to your door.

When the Boeing leadership let the customers run roughshod over the manufacturing team, they paid the price.  Now that they have decided to stick by their team, sales are up, morale is up, all signs are that the product will be better, and it certainly will cost less.

How can you learn from the experience of one of the largest manufacturers in the world handling a project a thousand times more complex than yours?  The same thing: believe in your vision, your product, and your team.  The customer isn’t always right, sometimes you need to stand up for your vision.  Sure you need to recognize your own “galley cart” case, but most customers, like children, appreciate it when you show a little discipline.

New Yorker - April 30, 2007

The current issue of the New Yorker has an interesting article this week entitled “It’s the Workforce, Stupid!”.  The article highlights the short-sidedness of companies that layoff huge portions of their workforce in an effort to appease Wall Street and other critics.

Using the current examples of Citibank and Circuit City, the article takes the leadership of these companies to task for their recent layoffs.  It points out that layoffs rarely have any real long term effect on the finances of the company.  But, with CEO tenures running so short (around six years), it doesn’t matter because layoffs aren’t done for the long-term.  They are done in hopes of a near-term stock lift to fatten the option-laden leadership team.

The article touches on the ham-handed way so many companies handle “downsizing”:

More recently, however, downsizing has become less a response to disaster than a default business strategy, part of an inexorable drive to cut costs.  That’s why Circuit City can proclaim, “Our associates are our greatest assets,” and then lay off veteran salespeople because they earn fifty-one cents an hour too much.

This, to me, is the crux of the issue with downsizing.  In my experience with layoffs, the problem is the effect they have on the team.  There is no way to do a layoff for purely financial reasons that doesn’t play havoc with organizational morale.

The problem is, as I have said repeatedly, that you can’t treat people like automatons.  Constantly repeating “people are our most important asset” doesn’t make them feel any more valuable.  In fact, it often makes them believe you think of them like the other assets — cash in the bank or that drill press over there.

The catch is that people can think.  They draw their own conclusions about what you think is the most important part of the business.  And it’s just really hard to send a good signal to person A while kicking person B out the door.  It’s one thing if B was a loser who deserved to go.  But more often than not, B just lost the layoff lottery, and A thinks “there but for the grace of god, goes me.”

In my experience, as a member of a leadership team trying to cut staff, as a member of a team with people being cut around me, and as a consultant trying to help people do it right, there is almost no way to cut people without causing collateral damage.  There are only two ways to cut people for financial reasons: 1) voluntarily, where you ask people to self-select, or b) involuntarily, where management chooses the losers.  This is a lose-lose situation.

In the first case, where you ask for volunteers, it should be obvious that the first people to leave are those with the best prospects for other employment — the good people.  What remains are the losers who either can’t or won’t find work elsewhere.  Not really the kind of team you upon which you want to build a turnaround strategy.

In the latter case, even if you chose to jettison only the lesser performers, the remaining good people are scared about the potential next round of layoffs.  Since they have the best alternative job prospects, they leave as fast as they can.  Now you have little or no team left at all to effect the desired turnaround.

I’ve seen several examples of both cases up close and personal.  Rats deserting a sinking ship is an apt visual.  And every scenario ended up getting far worse before they ever got back to anything resembling normal.

There’s only one way I can imagine a downsizing working effectively.  I say “imagine” because I’ve yet to see it be done this way.  The leadership needs to be absolutely positive about the stable financial state they need to obtain.  They need to calculate precisely how many people need to go, with complete confidence, so that they can do one, and only one, layoff.  Repeated fits and starts toward the final workforce numbers are just the kind of thing that makes people panic.

Then the management team needs to be stunningly frank with the employees, admitting the problem in detail, and drawing out the precise path to success.  Like any other project they need to have a very clear, concise, and credible vision for the future, and be able to sell that vision to everyone.  It’s vital that this vision is believable by everyone, as they will be almost infinitely skeptical.

Then, they need to individually go to the people they want to keep and sell them on that vision.  Each “keeper” needs to understand why they are a key part of that future vision for success.  Management can’t just be reassuring, the case has to be personal and credible.  Remember, these people are just short of panic, they will be skeptical.  They need to truly believe, so that they won’t bolt for the door.

Finally, the layoff needs to be done quickly — like tearing off a band-aid.  Downsizing rumors ripen with age, and not in a good way.  The mean-time to implosion is days, a couple of weeks weeks at most.  Having something out there for a month or two just gives the good people time to polish their résumé.  So once, it’s clear this has to be done, do it promptly.

This is a path to success with downsizing.  But as I said, I’ve never seen it executed this way.  Perhaps you have.  I’d love to know about your experience with downsizing.  Add your comment to the discussion to tell me about your take on it.

HT to Nancy for the pointer to the story

Warren Buffet

As I noted in this post, it’s annual report season again.  I just opened my Berkshire Hathaway annual report and once again was not the least bit disappointed.

The Berkshire report confirms, as it does every year, why I am a card-carrying, stock-owning, unabashed member of the Cult of Warren Buffet.

The report, most of which can be found here, is such a wonderful read.  Warren crafts his usual narrative about the state of the company, and it is with out a doubt the most readable annual report I’ve ever seen.  Even though his note is long, at over 20 pages, there’s almost no business jargon, there’s no filler, and not a smidge of the spin so many reports are drowning in.  I read every word — and every word of all the accompanying documents.  All in one sitting on the airplane.

The report confirms again what a really great manager and leader he is.  He simply does just about everything right, and does it with such frankness, charm, and sincerity, that I can’t help but gush over the guy.

It’s not that he’s perfect, and not that he’s magic.  He’s made mistakes, and rubs a number of people the wrong way.  But I think most of those people need to untwist their underwear and take some deep breathes (or a couple Valium).

Just like Warren, I’ll be straight with you: I’m a shareholder in Berkshire, and it’s just hard not to like the guy when the returns are so great.  But in reality, that’s just a small part about what I think makes the guy so special.

Berkshire Hathaway Home Page

Reading his report, or even looking at the Berkshire web site (seen at left), the first thing you notice is how upfront and frank the whole operation is.  Who else has their link to their SEC filings as the fourth item on their home page, or includes the last 30 years of Chairman’s letters right in plain sight, or has their answer to the most controversial of their shareholder motions posted on the home page?

With most companies, this kind of stuff is buried in the filings, if it is available at all.  Nothing is ever said that some spin doctor hasn’t crafted beyond intelligibility.  And acknowledging mistakes?  Well that just isn’t done, doncha know.

But with Warren, it’s all right there.  In plain sight, in plain english, and it’s just the plain truth.  After plowing through miles of other poop in other glossy annual reports, this one is like a cool ocean breeze.  And there’s not a glossy picture of the CEO, or the Board, or the remarkably (intentionally?) diverse workforce in sight.

So stop reading me, go read Warren’s letter.  Here’s the PDF file:

Warren Buffet’s 2006 Chairman’s Letter

Then come back here, and tell me what you think.

Alberto Gonzales

Once again, I’m going to risk taking this blog into the political realm by discussing a current political controversy.  But, I promise, the emphasis here is not on the who, or the why, but rather the how.

Alberto Gonzales, the United States Attorney General, is in a lot of hot water lately about the firing of eight US Attorneys around the country.  This action has stirred up a hornet’s nest of political noise, and has once again backed the Bush administration into a corner.  No matter the outcome, there is a lot to be learned from how this was handled.

Let’s begin by stating that I firmly believe the Bush administration has every right to have whoever they want as US Attorneys.  These are political appointments, and often turnover between administrations.

But there are ways to handle this problem, and ways to not handle it.  With most incoming administrations, the typical approach to these political appointments is to fire the whole lot of them, then fill the positions with people you want.  This has the great advantage that you get all your own team, and more importantly is it eminently fair.  Nobody feels singled out because everyone was escorted out.  Sure it feels harsh, but it is hard to argue with the process.

Unfortunately, Mr. Gonzales took another approach.  Drawn into the incessant politics that seem to permeate the Bush whitehouse, it appears that he yielded to the pressure of the machine.  He picked only a few attorneys who had somehow angered the powers that be, and summarily fired them.

The problem with this approach, aside from the overtly political nature of the process (a discussion I’ll leave to others) is that is was inherently unfair.  Of course it was biased by the politics of the decision, but more importantly to our discussion, it violated my number one rule for job actions: no job action should be a surprise.  As witnessed by the testimony of the fired attorneys on capitol hill a few days ago, clearly every one of these people was at least somewhat surprised by their termination.

All of the terminated attorneys received stellar performance reviews in the last several appraisals.  They were praised for their hard work, their integrity, and their results.  Then they walked in one day and — poof, they were fired.

Now this is just simply bad management.  I’d like to recommend that Mr. Gonzales, the entire Bush administration, and you all read my FAQ on how to fire people correctly.  It is a clear guide on how to move someone out when you’ve decided they need to go.

But to make matters worse, and perhaps a more devastating political issue than the suddenness of the firings, was the uniform denial of the reason for the action by the entire Bush clan.  They denied the fact that they were political actions (which I will remind everyone the Bush administration has every right to do), but instead called them actions based on performance problems.

Just as I note in the FAQ article, this is bad management because it’s not being honest and straightforward with the victim, and is likely to cause them to get upset.  Especially when the facts do not back up a claim of performance issues.  Quite the opposite, in fact.

So, it should come as no surprise to anyone that the terminated employees cried “foul!”  And it should come as even less of a surprise that an overtly political process handled poorly would become a firestorm.

Too bad, because if they had simply handled it right, we’d all be arguing about vastly more important things, like how to get out of a quagmire and who the next person to lead us there should be.

A key component of being a good leader is being able to speak to the team in a way that is engaging, informative, and motivating.  Certainly, understanding the objectives, marshaling the resources, making good, timely decisions, and getting the job done are important aspects of leadership.  But I was reminded yesterday how absolutely vital it is for leaders to be able to, often spontaneously, get up in front of the group and communicate effectively.  This is far more difficult for some than others.

I’ve seen more than a few people who were technically competent, even brilliant, with deep understanding of the goals and how to accomplish them who simply fell apart when required to speak to the group.  Most of them weren’t frightened by the challenge of public speaking, they were often even arrogant because they had such overwhelming command of the issues.  No, they were just lousy at it.

And, as anyone skilled in public speaking will tell you, a major part of being a good speaker is knowing your audience and making sure you are talking about issues they care about, in ways they can understand.  This is important not only for your preparations, in deciding what to say and how to say it, but even more importantly during the talk.

It is crucial that you pay close attention to more than just your talk, but also to your audience.  You need to constantly ensure that you are engaging them, that they are understanding you, and that they are taking the journey along with you.  This takes practice, and from what I can tell, it’s a skill not everyone has.

There was a continuing skit on NBC’s Saturday Night Live about a woman (played by Rachael Dratch) who had no “gaydar” — she couldn’t identify stereotypical gay men and flirted with them fruitlessly [oops, really bad pun].

Many people have a similar problem with public speaking, a problem I call having no “saydar”.  They can’t say anything while also respecting their audience.  And there are many flavors of this malady.

Some are so frightened that they simply want to make it through this horrible experience.  They have shut out all thoughts that there might be people listening and they become the “little engine that could” of public speaking: “I think I can, I think I can…”

Others are so enraptured with the sound of their own voice that they are oblivious to all other input.  You can even see them sometimes close their eyes and talk as if a singer lost deep in a ballad. “Don’t bother me while I pontificate.”

Still others ignore the obvious signs that they are losing their audience and press on regardless.  It seems that nothing less than an “Animal House” level food fight would disrupt them from their mission of getting through the material. “I’m going to say this, and you’re going to listen, dang it.”

They all share the same problem: they aren’t paying attention to the target.  They just aren’t watching the audience to see if people are restless, bored, distracted, or following the material.  It’s really not that hard, and if you can manage to pick out several in the audience you know you are connecting with, it can even make speaking a lot of fun.  But it does take effort, and more than a little selflessness.

So, I ask you: how good is your saydar?

“Sam”

I was involved in a small business for a time.  It wasn’t tiny, with $4+m in revenues and about 30 employees, but it was small in that it was started by a young entrepreneur and still had plenty of headroom for growth.  The young leader was full of passion for the business but had a lot to learn about leading a team.  It was fun (for a while) to watch and help this company and its leader grow.

The young owner, who I’ll call Sam, had never worked for anyone but himself, having literally started the business in his parents’ garage and grown it from there.  As such, he hadn’t experienced what it felt like to be lead by someone he respected, to be mentored and supported, or to win as a member of a team.  He also didn’t know what it feels like to have a jerk, an egotist, and/or a hypocrite for a boss.

Oh, he read a lot, and took great pride in the undergraduate business degree he had earned at the local college, so he thought he knew a lot about running a business.  But having never really seen or felt good leadership put him at a real disadvantage.  And reading the latest hot business book has sent more than a few inexperienced managers down a dark alley.  Sam was no exception.

One of Sam’s worst problems was the “do as I say, not as I do” syndrome.  It’s not uncommon for young people thrust into leadership roles to have this problem, and it certainly is an issue for people without much management experience.  And Sam had it bad.

You see, Sam was a stickler for the clock.  People were supposed to be there from 8:00 to 5:00, and they had better be there.  He instituted grave penalties for being as little as five minutes late without an “excused absence”.  Employees were regularly singled out for punishment even though they had simply been at the mercy of Seattle’s notoriously unpredictable traffic.  One employee even quit after several such episodes because he just couldn’t justify to his family tacking on 20 minutes of cushion to his 90-minute (one way) commute, just to avoid the silly penalties and threat of termination.

Now, I’m all for good and consistent work rules.  And I think that letting some people get away with always coming in late is more than a little unfair, to both the organization and their co-workers.  But the problem here was not with the rule, it was with Sam himself.

The issue is that Sam showed up whenever he wanted to.  Rarely in before 9:00, and not infrequently wandering in at about 10:30, Sam just couldn’t be bothered with setting an example.  He would swoop in long after everyone had been toiling for hours, demand to know when so-and-so showed up, and then fume over “what to do about that guy”.  He never saw the irony in that, even when it was pointed out.  And if he did, he was quick to remind you “who owned the place”, as if that somehow changed things.

Worse however was his end-of-day behavior.  Sam was on a tight leash at home, with strict orders to be there by 5:30.  Perhaps it was revenge for years of growing a business, with its late nights and weekends, or perhaps it was just the newborn at home.  I don’t know the cause.  But he was out of there like a shot before 5:00, even though the business was open until at least 6:00, and many stayed well into the night to catch up.  Woe be the soul who stood in his way before 5:00, as wild horses couldn’t keep Sam in the office late, important company-wide projects notwithstanding.

And to take make it even worse, Sam was a micro-manager.  He saw to it that everything in the company was under his thumb.  So on the ride home, he would call each and every sales person on their cell phone and quiz them about the day’s activities, and to pressure them to do better. “How’s it going out there?” he would ask.  And then poke and prod into every minute detail of the person’s day — until Sam rolled up into his driveway and the conversation would abruptly end.

Everyone dreaded these calls.  Soon they got to be called the “HIGOT” (pronounced hig-gut) calls, for “how’s it going out there”.  It was used as a noun, as in “did you get the higot today?” and “oh, my word, my higot was horrible!”.  It became the talk of the company.

The irony of the higot was completely lost on Sam.  That he would call and micro-manage people who were still hard at work while he was on his way home to his family rubbed people raw.  It was made even worse by his insistence that certain things “get done before I get in there in the morning”, since everyone knew they would be in long before he was (whenever that would be).  And he repeatedly went over the top by promising to stay late or show up on the weekend to work on some critical project, only to fail to show with no warning whatsoever.

The lesson I take from the higot is not that the leader has to be the first in and last out (although that doesn’t hurt), and it’s not even that you shouldn’t micro-manage (although you really shouldn’t).

The lesson is that everything you do as a leader sends a message.  It’s far less about what you say than it is about what you do.  If you want people to treat time as important, you should treat it as important too.  If you want people to behave with integrity, you need to model that behavior.  And if you want peoples’ respect, you have to earn it by what you do, not by what you say.

I’ll have a lot more on this aspect of leadership, but for the time being, simply remember it’s a great deal better to ask how it’s going when you’re standing shoulder-to-shoulder with the team.

Tony Dungy and Lovie Smith

With the upcoming Super Bowl, a lot has been said about the two coaches: Indianapolis’s Tony Dungy and Chicago’s Lovie Smith.  Yes, the big story is that they are both the first African American coaches to take a team to the Super Bowl.  But I’m more fascinated with the fact that they are both great managers.

Friends from long ago, it is nice to see two truly “good guys” get to the top of their game.  It’s even a little sad for one of them to have to lose on Sunday.  Reading an item in the Wall Street Journal comparing the two of them with their calm and reasoned style to some screaming managers got me to thinking.

I’ve seen a lot of screaming managers.  The pressure cooker world of high tech seems to attract the a-type personalities that end up as bosses who find volume as an easy substitute for reason.  I’ve seen numerous cases of managers (I can’t say “leaders”) who use intimidation, threats, and personal attacks in their regular daily lives.

Steve Ballmer

In fact, I’ve worked directly for one of the world’s great screamers, Microsoft’s CEO Steve Ballmer.  He is legendary for loud volume, having once required hospitalization for vocal chord damage after an especially vigorous affair.  I’ve witnessed him at his best (a fantastically energizing and motivating speaker) and his worst (reducing senior managers to tears during the semi-annual business reviews).  Steve regularly barging through my door, fully on fire and with no regard to my current situation, was a key factor in my choice to leave Microsoft.

Now, I don’t begrudge Steve, or anyone, the right to get animated and excited when things are going wrong.  Unfortunately, Steve, when in a tough spot, is inclined to take things to a personal level that simply crosses the line.  He goes from criticizing the idea or the results, and moves to things designed to hurt the person.  Although Bill Gates is famous for saying “that’s the stupidest f&*%ing thing I’ve ever heard”, it is more Steve’s style to say “you are the stupidest person I’ve ever met, who hired you?”  It costs dearly in respect on both sides, and never serves to motivate anyone for very long.

The problem is that yelling and intimidation work…  in the short term.  Much like what falsified financial statements, “stuffing the channel”, and keeping secrets do for business, yelling and intimidation do similar things for organizations.  They work for a while, people do scurry around frantically to avoid a follow-on beating.  But soon they tire of the abuse, and before long, they move on or shut down completely and resign themselves to the pain.  Neither makes for a great team.

This brings me back to Dungy and Smith.  As the WSJ article noted:

Both believe they can get their teams to compete more fiercely and score more touchdowns by giving directives calmly and treating players with respect.

This is a pattern I have seen time and again.  Calmer, reasoned, thoughtful leaders get better results, have better loyalty with much lower turnover, and have better luck hiring people (word gets around).  People enjoy coming to work, and don’t live like abused children in fear of the next beating.  They are happy to give extra effort for people who they respect and know respect them.  And undoubtedly, if given enough of a chance, they make the whole organization more successful.  Perhaps they even take it to the top of their game.

There will be plenty of screaming on Sunday, with more than a few fans coming to work hoarse on Monday.  But that won’t be the case for Tony Dungy and Lovie Smith.  The good news is, a great leader is going to win the Super Bowl on Sunday.  The bad news is we don’t know yet which one it will be.  I’ll be cheering for them both.

Update: And the winner is Tony Dungy and the Indianapolis Colts.  Congrats to them all.

I’ve had a busy week for interactions with the service industry.  Three different cars spent time in the shop, and a beloved family pet spent his final days in a pair of vet clinics.  I’ve had far too many chances to see what makes these businesses tick.

Last things first, late Tuesday night we rushed my son’s pet rat, a remarkably cute, friendly, and lovable guy, to the vet emergency room for his final bout with chronic lung disease. The emergency room, although quite a drive away, was a beautiful facility, with consummately professional people.  It was breathtakingly expensive, but the care was great as they stabilized him.

Rocky

The next morning I rushed him to his regular vet for what turned out to be his last time.  That vet’s office is more what you envision, a tired little building with worn fixtures and plenty of old pictures of patients everywhere.  The people, however, were just amazing, and they offered the best possible experience for us in this amazingly difficult time.  Two very different experiences, but with similar results — great service from people who really cared.  Although I wish the latter clinic was as nice and up to date as the specialty center, clearly the people didn’t let that effect their attitude in the least.

With the cars, however, it was a very different story, offering stark contrasts.  The three cars are literally from around the world: a German sport sedan (BMW), a Japanese small SUV (Lexus), and an American monster SUV (GMC).  A pretty interesting cross section of the car business, and this week, it offered me a great chance to see their customer service experience in close-up.

The BMW was in for service a week or two ago, but it needed to return on Monday.  It needed new tires (after all of 20,000 miles) so I went to Discount Tire, and was in an out at a respectable price in just over an hour.  Not bad.  The car however, was nagging about “service due”.  It had just been in for service.  As I was near, I stopped in to ask the dealer for assistance. The dealership is being completely reconstructed from the ground up, and it is a mess.  The service department is in portable buildings.  There is construction activity and confusion everywhere.  But the service guy promptly looked it up, turns out one of the many “resets” that should’ve been done on my last service wasn’t, and it was handled cheerily and in less than 10 minutes.

But the original service episode was a different story.  These new cars don’t go in on a regular basis, every 5,000 miles would be too easy.  No, they tell you when to bring it in.  So one day, it started saying “service due”.  Great, I promptly called for an appointment — which they could only do three weeks out.  When I arrived I received a minor chastising for being overdue on my service…  After I defended myself they explained that the dealership overhaul was largely to expand the service department and this would no longer be an issue.

The GMC experience was from a different planet.  I have always maintained that car well, and now that it is getting long in the tooth (~100k miles) I wanted to get it fully up to shape.  Over the last couple of months I have thrown plenty of good money at this car: thousands for extensive bodywork and paint (to make up for years of abuse by teenagers), and at least four trips and $7,000 to the dealer for a variety of ills.  They didn’t get one fixed the last time, so I was in again on Thursday for another shot at that issue.

The dealer is an old-fashioned car dealer, on the row of car dealers that so many towns have.  It is a cramped, ugly, and tired building with carpet that is five years past “worn”, fixtures that were outdated from day one, and a crew of employees who seemed to want to be anywhere but there.  My service rep is a fine young man who tries exceptionally hard to make due in these surroundings and tried hard to make the experience as painless as the fourth trip in a month to a car repair facility could be.  But the promised rental car was not there (I was stuck) and nothing much softens the blow of a second try at fixing the same problem — out of warranty.  I arranged a pick-up and was glad to be gone.

Then, today, the Lexus went in for it’s 60,000 mile checkup.  The service facility is a mile or so from the dealership, a temporary measure as they build the Taj Ma-Dealership, an almost unbelievable structure being built on the site of the former city hall.  And yet the service facility isn’t temporary buildings, no, it’s a beautiful, fully Lexus-branded edifice.  It has tile floors, great lighting, and a row of clean, windowed offices facing the service drive.  I was greeted promptly by a pair of smiling young men, one to take the car, and one to help me.  We decided on the service regimen in his private office, where he genteelly tried to upsell me to over $1000 in service.  I declined, but he took it well, and I was promptly off and being whisked away in a private shuttle for me — back to the GMC dealer to pick up the truck.

It was then that the contrast was so clear.  The broken down GMC dealership with last year’s Buick Rainier (small SUV) sporting a $5000 mark down sticker on display, a crew beaten into submission by their environment, and customers who seemed just as depressed vs. the clean, efficient, and service-heavy Lexus dealership nearly beating customers away with a stick.

People in the car business (an industry I’m quite familiar with) say time and again it’s about the products.  But it’s not that simple.  For the money the GMC is a fine product, I’d buy another and be pleased with the cost-value equation.  No, it’s about investment, organizational culture, and attention to detail.

Toyota (the Lexus parent company) makes these investments, hones the culture, and sweats the details.  BMW wants to do the same, but never seems to measure up.  And GM just further calcifies.  For me this contrast was drawn ever so vividly this past week Never was it so clear why Toyota is taking the world by storm and Rick Wagoner of GM is trying to keep his job and that of 325,000+ of his employees.

It’s been a very rough winter for us here in the Puget Sound area.  As I have noted previously, we’ve suffered wind, snow, rain, sleet, all resulting in power outages, school closings, and on and on.  At times it feels like we’re only missing pestilence to round out the collection.  Looking out at the snow makes us doubt the truth of global warming, no matter how “inconvenient”.

It has been a tough winter also on the school administrators.  Our big power outage in December came during the holiday, but would’ve meant more than a week off school.  Since then, we’ve had two major snow storms with several days off.  As I write, our school has closed for the sixth straight day, as more snow has fallen just in time for the morning commute.  The teachers are in a panic, missing a week in their curriculum can’t be fun.  And ideas for making it up range from canceling spring break to additional time in the summer.

This all points out how hard it is to make the decision to close a school.  There are dozens of dependencies to consider, including buses, teachers, new young student drivers, and angry parents who either don’t want to drive or don’t want to miss work.  The pressure to get the school work in while keeping people safe makes for a continuous load of tough calls to make.

This morning was an especially tough call to make for our school head.  At 5:00, the usual time when these calls are made, the predicted snow wasn’t here.  Kids had been off since last Wednesday, when he made a quick and controversial call to close while other schools did not.  So the pressure to stay open today was intense.

Then the snow came.  Schools all around closed, even the stalwarts.  And yet, the snow was supposed to stop any minute now, so how to decide?  As it got later, the early students and teachers started arriving.  But it still was snowing.  Parents were calling.  What to do?  Well, he closed at the last minute (7:10 am), with students arriving, plans for the day long since decided.  It’s a mess.  Not only was last Wednesday’s call controversial, but today’s is sure to be as well.  I can hear the phone ringing from 10 miles away.

How does this effect you?  Well it points out some things you already know.  Making decisions is never easy.  Second guessing is.  And the timing of decisions is often a no-win situation.  Decide too early, you don’t have all the data.  Decide too late, and the wheels may already be in motion.

It all points out the value of laying the groundwork for decisions well in advance.  If you have a good vision for your project or organization, many of these kinds of decisions are easier to make.  And there are a number of areas where you can predict the kind of difficulties you may run into, and “pre-make” the decisions well outside the panic of the crisis.  That’s why I recommend you do the homework for a good People Strategy.  And you can apply this same technique to a number of other areas.

I’m not sure if a clear “school closure” guideline policy would have helped today.  But I do know that time and again in business, having a clear vision, spending the time to be prepared, and addressing predictable issues long before they arise, all combine to make you a better leader.

I have written more than a little about Home Depot and its CEO Bob Nardelli.  From their top-heavy “Culture Change Offensive” (which I found offensive here), and the silly army mentality Nardelli tried to force down everyone’s throat (and got stuck in my craw here), to Bob’s stunning pay package (which rubbed me raw here), and even his autocratic shareholders meeting (which I recounted here) Nardelli has provided plenty of fodder for these pages.  Well, it seems that the company and the board have finally come to their senses.

ATLANTA, Jan 03, 2007 — The Board of Directors of The Home Depot and Bob Nardelli announced today that they have mutually agreed that Nardelli would leave his position as The Home Depot’s chairman, president & CEO and as a Director effective January 2, 2007.

In other words: “get out…  like yesterday”.  Clearly the company simply tired of all the bluster and noise that went along with Bob’s “Army Mentality”, and the corporate results have been lackluster since he arrived.  And as I said in this piece, the mood in the stores is rancid.  It is a wonderful sign that the company saw the insidious effect Nardelli had, and chose to put an end to it.

But, the company didn’t completely come to their senses.  They continued to give Nardelli completely ridiculous payouts even as he exits in disgrace:

Nardelli and the Company have agreed in principle to the terms of a separation agreement which would provide for payment of the amounts he is entitled to receive under his pre-existing employment contract entered into in 2000.  Under this agreement, Nardelli will receive consideration currently valued at approximately $210 million (including amounts which have previously been earned or vested).

Holy Cow!  Even in the face of amazingly generous pay packages to CEOs, this one is a stunner.  This means that Nardelli has received, since becoming CEO of Home Depot, a whopping $400+ million in compensation!  During the same time, HD (the stock) has gone from a high of around $70 to the mid-30s.

And worse, much of this is clearly a golden handshake, or simply “go away” money.  It is optional, the board didn’t have to agree to it, but just wanted him out so badly they were willing to pay almost anything to have him go away:

This consideration will include a cash severance payment of $20 million, the acceleration of unvested deferred stock awards currently valued at approximately $77 million and unvested options with an intrinsic value of approximately $7 million, the payment of earned bonuses and long-term incentive awards of approximately $9 million, the payment of account balances under the Company’s 401(k) plan and other benefit programs currently valued at approximately $2 million, the payment of previously earned and vested deferred shares with an approximate value of $44 million, the payment of the present value of retirement benefits currently valued at approximately $32 million and the payment of $18 million for other entitlements under his contract which will be paid over a four year period and will be forfeited if he does not honor his contractual obligations.

The bulk of this is sickening…  I’m sure there were clauses in his contract that would have allowed the company to fight most of this.  I haven’t seen it, but I’d be shocked if it was all carved in stone.  I’m betting they didn’t have to accelerate his unvested and/or deferred options, they didn’t have to buy out his retirement plans, they just did it to get rid of him.

While I applaud Home Depot for ridding themselves of this jerk, I wish they had the backbone not only to fire him, but to not pay his blackmail too.  But I’m sure the company is better off without him.  The markets surely agree, the stock is up over 3% today alone on the news.

Mulally and Ford at the Coronation Announcement

The Wall Street Journal had a marvelous article [ed: unfortunately subscription-only] about the turnaround Alan Mulally is trying to make at Ford.  I have written about this before (see this post here), but put simply, I am a huge fan of Mr. Mulally.  He did great things at Boeing, and from what I can tell from this article, he’s off to a great start at Ford too.

The article goes on to describe in detail how Mulally is analyzing a business he is admittedly new to, and how he’s working on his plan for change at the company.

The fate of this automotive icon rests on the aggressive plans of Mr. Mulally, a former Boeing Co. executive who has spent his career outside the auto industry.  His emerging agenda calls for Ford to plow through “gut-wrenching” change to achieve profitability by 2009.

From what I can see, he’s hitting all the right notes by focusing on brand overlap, silly inconsistencies and waste between brands, and overall efficiency.  Again, this is a guy who has moved mountains at one of the largest employers in the country, I’m sure he can make strides here. “‘I’ve seen this movie before,’ Mr. Mulally told his new executive team when he took over Oct. 1.”  I just wish he could teach our president a thing or two about analyzing situations and facing ugly facts, but I digress…

One of the more interesting notes in the article however, very much caught my eye.

In the executive suite he shares with Chairman Bill Ford, Mr. Mulally says he asked Mr. Ford why he hadn’t integrated the company.  He says Mr. Ford agreed that integration was desirable, but told him it was difficult.  Every time Ford had considered forcing integration, a new hit product — such as the Explorer, Taurus or F-series truck — would come along and propel profitability without tough changes, explained the fourth-generation Ford leader.

To steal from Mr. Mulally, I’ve seen this movie before too.  I have watched more than a few companies put off changes they knew they needed to make because they were blinded by their success.  And the more bright the light from the current success, the more blinded they became to the obvious issues.  It’s important to realize this not only applies to products and/or projects, but also to people.  We tend to overlook the worst part of peoples’ behavior when they are having success as well.

I saw it quite a bit at Microsoft.  It is no secret that the Windows team recently made some major changes in leadership that were long overdue.  Those changes were put off time and again by the product’s stunning profitability and the fear of killing the golden goose.  There are a dozen more, less public, examples of products that were off-target and in need of correction, but still creating revenues that would finance even the most outrageous debacles.

We also had managers who were simply terrible, and yet were continually promoted or rewarded for their results. I discuss this here too, but success postpones many needed HR actions at Microsoft and elsewhere.  I even wrote in the performance review of one jerk who worked for me that he “is being removed from a supervisor position and being returned to an individual contributor role, and should never again be allowed to supervise others.”  He was recently mentioned in a national publication as a potential future CEO of the company.

The point of all this is that, just like dental hygiene, auto maintenance, and many other things, just because you seem to be OK today doesn’t mean your gut instinct that things need to be fixed is wrong.  Don’t let success blind you to the changes you need to make.  And don’t, please, make that jerk your CEO.

We live in the Pacific Northwest that, like most regions of the world, has natural disasters to worry about.  Every region of the world has some calamity on its potential horizon.  Be it hurricanes, tornadoes, floods, earthquakes, droughts, even plagues of locusts, it seems clear that no place is without something to worry about.

Here we live in a place of splendid beauty that carries the risks right with the beauty.  We have majestic mountains that are active volcanoes.  We have a seashores that threaten tsunamis.  We have a landscape littered with earthquake faults.  And, as the “Evergreen State” we have a whole lot of trees.  All of this is beautiful, and dangerous.  This week, we got bitten by the beauty of the trees.

On Tuesday and Wednesday of last week we got a little warm-up storm with winds in the 30+ mph range with gusts to 60.  Some trees were knocked over, a parking lot of my children’s school saw one totally flatten four cars and damage several others.  But that was apparently just the semi-finals.

On Thursday night late, we got a whopper of a storm.  Winds at the coast were over 100 — category 1 hurricane force; we saw winds in the 60+ range, with gusts that had to be 80+ mph.  The storm hit overnight (as they always seem to do) and plunged virtually the whole region from Oregon to British Columbia into darkness.  We’ve been dealing with the carnage ever since.

We live out of town a fair bit, and we seem to lose power at the drop of a hat.  We always go dark before everyone, and get the lights back long after everyone else.  This time was no different, we lost power at 5pm on Thursday, as the storm just began.  And we have no power yet, three days later.  Given everything they tell us, it will be at least Wednesday or Thursday (a week!) before we see power again.  Traveling about yesterday it seemed like a war zone, with every other power pole broken or with a tree dangling over it.  The wires are draped like spaghetti, with insulators and transformers scattered asunder.  It appears as though Puget Sound Energy will have to rebuild the lines completely from scratch.  So while we see power coming on around the region, our wait is sure to be a long one.

But hey, you say, wait a minute.  How are you writing this blog entry?  Are you at an internet cafe, or a friend’s house that has regained power?  Nope.  We lost power for only 30 seconds, and never lost TV or internet connectivity.  We are warm, dry, and only moderately inconvenienced.  You see, we were prepared.  We have an automatic natural gas fired generator that powers much of the house.  We have also have a gas stove, heat, hot water, even clothes dryer.  The oven and A/C don’t work (not that we need A/C), and the outside Christmas lights are off.  But we can watch TV (satellite) and all the other things.

I was ridiculed for the generator when we first installed it years ago.  Neighbors thought their gas powered portable units were just fine.  When I upgraded it two months ago, it was seen by many (including my loving wife) as a needless expense.  Today, I’m feeling pretty darn smug.  My neighbors are standing in gasoline lines and filling tanks every couple of hours to get enough power to heat, refrigerate, and light a room or two.  We’re running the dishwasher and doing the laundry.  They’re reading by flashlight waiting for the cable TV and internet to return.  We’re watching “It’s a Wonderful Life” and surfing the internet on the T1 line.

So what does this have to do with you and your leadership?  The point is that preparations like this are wildly unpopular when they are done.  They cost a lot of money.  They take a lot of time.  They take thinking about things that aren’t in the line of daily business, and are, frankly, pretty darn unpleasant to think about.  People charged with making the preparations will complain, the accountants will wince, and the bottom line will take some kind of a hit.  They all want to play the odds, and they all think it’s overkill.  It takes a very deep kind of strength and will power to make it happen.  And that is leadership.

Then something happens, and you get a chance to feel awfully smart.  It may be that the organization survives when it might not have.  It may be that it simply gets back on line faster than others.  Or it may be simply that you handle something with relative ease that others need superhuman effort to survive.  Whatever it is, it makes it all worthwhile.

So I ask you: what is your calamity, and are you even remotely prepared?  Is it a natural disaster like earthquake, fire, flood, or wind?  Is it a business calamity like a major data loss?  Is it something more personal, like the death or departure of key players?  Whatever it is, have you really planned?  Have you spent the time and energy necessary to make it really survivable at a level that is not only tolerable, but a real competitive advantage?  Do you have the will and strength of leadership to make it a priority?  It’s never a bad time to think this all out.

Oh, and before you ask, yes I back up everything on all my computers.  Every night.  And store a backup off site.  I’ve had a disaster and never would suffer that again.  Yep, I’m feeling pretty smug about that too.

The Scene of the Crime

One of the things I hear so often from leaders I’ve worked with is how quickly a casual comment of theirs got blown out of proportion.  It’s almost as if the simple, off-hand remark they made a couple of months ago grew legs and got a life of its own.

They discover someone working on something unexpected and ask “why the heck are you doing that?”  And the junior manager will say “Because you told us to.  Remember back in the bathroom at the conference last May when you said you wished someone would tackle that problem?  Well I built a team of 30 and we’ve been working on it ever since.”

In stunned horror they suddenly realize that a tiny offhand comment became a project.  They can’t be wildly upset, after all, it took a very proactive manager to get wind of a problem and work so hard to resolve it.  But they can’t understand how anyone would interpret that simple, casual remark as a directive.

There are two kinds of common overreactions to this problem: 1) the leader never speaks without written notes ever again, or 2) they implement ridiculous controls on the organization so that it never happens again.  As in most things, however, the best result is somewhere in the middle.  After all, you can’t become the kind of stiff mannequin who never utters a casual comment ever again, that just stifles the whole organization.  And you certainly don’t want to build a culture where everyone is in fear of acting in a proactive way.  That’s the exact opposite of the organization you need to be working toward.

I recommend that you never overreact when you discover these kinds of rogue, skunk-works projects that you inadvertently kicked off.  Do not chastise anyone, especially not in public for this.  People absolutely need to feel empowered to take on organizational issues on their own.  You certainly don’t want to stifle this kind of proactive creativity.  If you must stop the project, pull the manager aside later and quietly explain that, while it may be an issue for the organization, it certainly isn’t a priority right now, and you definitely didn’t mean for them to go off and work on it.  You need to apologize for misleading them (I know you didn’t , but they think you did), and you need to handle the situation with delicacy, and perhaps a little humor.

At the other end of the spectrum, please, please, don’t put in draconian controls to require every tiny little project in the organization to meet with your approval.  This kind of micro-management kills organizations.  Each level of an organization needs to feel like it can work to solve the important issues that fall in its realm.  Putting up hurdles and passing judgment on everything anyone does just makes life miserable for everyone, including you.

More important and more effective than this level of micro-management is a clearly stated vision for the organization.  This vision includes organizational priorities that are so well known as to be second nature to all, including that junior manager in the washroom.  With things that clear and obvious, they will recognize the casual remark as just that, a passing fancy that was never intended to initiate any serious effort or action.

I’ve seen this happen so often, it is easily one of the most common issues for leaders to face, especially new leaders.  I’ll discuss more of this later, but it is extremely common for new leaders to not understand all the power that comes with their position.  Unspoken and unwanted reverence for their every word is just one side effect that new leaders often never knew was coming with the job.

As the old saying goes: be careful what you wish for, you may actually get it.

One of the toughest parts of being a leader is walking the line between democracy and fascism.  When it comes to the essential elements of your mission, where does consensus become chaos, where does direction become dictatorship?  This is one of the most important questions of style managers face.

And the answer simply isn’t clear.  I can think of examples where charismatic despots lead teams through innumerable obstacles to great success.  I can also think of cases where expert consensus builders worked their magic to make a team of hundreds behave as one.  There are many paths to success to be sure.

Clearly some leaders are just naturally better at one role than another, and they simply don’t know how to be a despot or a democrat.  You may feel that you can’t be one or the other, so why even consider the issue?  Just do what you do best.

But this is more than a question of style, and it’s more than about playing to your strengths.  There are times in every project when you need to be one or the other, and you need to both recognize when these cases occur, and find a way to play the appropriate role.

One of the most common situations where I’ve seen managers struggle with this balance is in meetings.  The team gathers together to consider an important question, to entertain ideas from across the spectrum, and try to work out the best solution.  But before the meeting really even gets going, the leader chimes in with their thoughts on the subject and kills the whole party.  They may do it because they think they are just “priming the pump”, to get the conversation started.  They may think they are just “tossing their ideas in to the mix” for all to consider.  Or they may do it because they are frustrated at the ideas presented so far.  It doesn’t really matter…  what they have done is kill the whole conversation.

What so many leaders don’t see is how this behavior, as innocent and well-intentioned as it may have been, and as delicately as it may have been presented, shuts down people on the margins.  When the leader of a group expresses their thoughts on a subject, three kinds of bad things happen: 1) the sycophants come running to the front praising the wisdom from on high, 2) the timid rush to the corners, hiding from the light, and 3) those that may have a different opinion fear risking their standing in the organization by contradicting the leader.  None of these are good for genuine discourse.

I know, I know, I can hear you now: “But I said it just as an expression of my opinion!  I prefaced it with ‘this is just my thoughts on this, but…’ I laughed and smiled when I said it, for gosh sakes!”  I’m terribly sorry, but all that doesn’t matter.  You’re the boss.  Years and years of conditioning have told people that what you say, goes.  All protestations to the contrary not withstanding, by expressing your opinion, you are guiding the discussion.  And, more importantly, shutting off input from valuable members of the organization.

[Side note: a similar issue is how, inevitably, the casual thought of the leader gets translated into an edict, and develops a life of its own (see my post here on this topic).]

I’ve also hear managers tell me: “well, if they are too meek to express their opinion in this forum, then they and their opinion aren’t worth much.”  Hogwash, that’s just the bully in you talking.  In my experience, some of the most insightful people are those who sit out of the direct line of fire and have the luxury to observe from a distance.  After all, still waters run deep.  You need to seek out these people.  You need to get some way to hear them out, whether in this kind of forum or in a more comfortable one-on-one setting.

The only real way to insure that you hear everything is to be quiet.  Remember that the minute you express an opinion, on any subject (even which donuts are best), the conversation changes.  Wait until the room has had its say, wait for a lull in the conversation, then offer up your thoughts — still including all the disclaimers, prefaces, and smiles you can muster.

Even then, there’s a risk.  You need to be sure you don’t come off like Judge Wapner on The People’s Court: “well I’ve heard your arguments, now here’s my decision.”  Save that tone until the very end, when a consensus was not reached, and a decision had to be made.  Then it’s OK to be the boss.  But until then, remember that the only thing you hear after you speak is what people think you want to hear.

So ask yourself, when I have a team meeting for the purposes of airing opinions, am I the elephant in the room?  Does it always seem like things come out the way I said?  Did I really hear from all corners of the room?  I bet not…

I had some errands in town this morning, so I stopped in the local diner for breakfast.  Nice, pleasant place with a good veggie omelet.  Unfortunately today, it was not quiet.  Twice, neighboring people took calls on their cell phone and loudly discussed the most personal of business, for the benefit and annoyance of the entire restaurant.

I now know quite a bit about “Jack”, the local car mechanic, and his personal financial situation, his financial relationship with his wife, the pending trade-in of his toolbox, how much it’s worth, how much his new one is going to cost, the delivery dates, his weekly payment, and on and on.  This incredibly loud conversation itself became the conversation at a half-dozen other booths.  And Jack was oblivious.

The other conversation was both briefer and more discreet, although I know when to go rob the person’s house today, as both he and his wife will be gone at a meeting.

All of this made me think back to my post last week about the spying scandal at Hewlett-Packard.  I wonder just how much of the leaking that went on at HP was of this variety — not intentional, not malicious, just inadvertent.  I wonder just how hard it really is to get extremely confidential information these days, without even really trying.

But most of all, I wonder if Ms. Dunn and the others on the HP board spent a great deal of money, time, energy, and corporate focus on the silly witch hunt for the leakers.  How much did it really matter if HP’s laundry was out in the open?  How much did it really damage the company if people knew that the company board was concerned about the performance of the CEO and wanted to fix it?  In reality, wouldn’t the time and energy have been better spent on fixing the problems with the company rather than the quixotic hunt for the source of the leaks?

This sends me back around to the whole issue of focus.  The HP board was facing a major concern over company performance, and just like me in the diner this morning, they were distracted by another issue.  It was an issue that may have seemed to matter at the time, but in reality, it was a sideshow.  Someone, somewhere on the board or in the HP leadership chain should have said “hey wait, this isn’t the real issue, let’s get back to that”.

That is hard, though.  Very hard.  Keeping your focus on the main issues is both one of the main characteristics of great leaders, and lack of it is the downfall of many failed ones.  George Bush is single-minded, and that gets some of his highest praise (not from me…  but that’s another issue…).  Bill Gates is excellent at it, something I’ve seen personally.  And, in my experience, we all could use practice at it.  I know I’m guilty of being easily distracted, more often than I’d like to admit.

So how do you do it?  You need to have a regular practice of asking yourself “am I focused on the right things?”  You need to have some formal list of priorities (a “to-do” list on a yellow pad, an electronic task list, whatever) that is carefully ordered and regularly updated.  And you need to encourage those around you to speak up and say “ahem…  aren’t we supposed to working on this?”  It takes hard work, diligence, and formal processes.

Not getting distracted will make you a better leader, and will benefit not only you, but the organization as a whole.  Put this one at the top of your priority list.

My mother called it back in June.  Billy Ford wasn’t long for this world.  I grew up in the shadow of Detroit, and my family always had connections into the auto industry.  She knew the Ford family was restless, and that Billy was in trouble.

The board [family] forced him out.  In a way, that’s too bad, since he is a really nice guy, charming, bright, “from good stock” as they used to say.  But, clearly, it was long overdue.  His departure is kind of sad for the Ford family, yet nothing but good for the company.  It also says something about family leadership and the challenge of passing down a Fortune 500 company generation to generation.

Bill Ford was probably doomed from the start.  If you think about his challenge, it was simply too much to ask of anyone, let alone a nice guy like little Bill.  He grew up in this company.  He toddled around the offices for years, sat on the laps of key leaders, and cut whatever business teeth he had under the big blue oval logo.  Even if he had a great vision of how to overhaul the stodgy old company, it was simply too much to ask someone to shake up a culture that was generations old — generations of his family.

These last few years must have been a nightmare for Bill.  He must have been in countless meetings where he said emphatically “we have to change, we have to do things differently, we have to shake off these cobwebs!” [ed: At least let’s hope he did (see my post here)] Only to be greeted by layer upon layer of senior management that looked blankly at him, shook their heads marvelling at how little Billy had grown, pinched his cheek and said something like “but that’s not how Henry would’ve done it.”  He couldn’t fire some of these people, it would be like firing your uncle.  For the family to expect him to make “bold moves” was simply unrealistic.

Alan Mulally and Bill Ford

Now the Ford board has made a super choice: they have selected Alan Mulally, formerly of Boeing, as CEO.  I’m a huge Mulally fan, if only from my view outside the company.  But throughout his turn at the helm of Boeing’s Commercial Airplane group, he was a sharp, effective leader.  And since his promotion opportunities were limited at Boeing by a new top dog (see my post here), moving on makes great sense for him.

I first became familiar with Alan Mulally during the development of the 777 airplane.  This was a huge deal in these parts, as it was the chance for the “Lazy B” to shake its old cobwebs and really develop something new and different.  Leading up to the launch, Mulally had numerous opportunities to appear in the press, and he always managed to do it with aplomb and to show his leadership skills.  At the launch (covered as if it were the Second Coming around here), he outshined the rest of the Boeing leadership as the clear, thoughtful, and talented one of the bunch.  Then, the incessant airing of the “Making of…” video on the local PBS station allowed us an even closer look at what a solid leader Alan really is.  He had done it, turned around the supertanker, practically in its own boatlength.

Recently, Mulally spearheaded the “Dreamliner” project, an even more ambitious plane that is, if leading-edge sales are to be believed, eating Airbus’s lunch.  It was a bold move, at a time when Boeing clearly dominated the huge plane market with it’s 747, and a simple tweak to that plane could offer again the largest plane in the world, he bet on moderation.  According to friends I have on the 787 (as the Dreamliner is now called) team, and they tell of Mulally passionately arguing of the demise of the monster busses with wings, and the coming move to smaller, more fuel efficient, point-to-point aircraft.  And how right he was, as if he could see $4.00 gas from the dust of 9/11.  It has been a brilliant move, and the 787 is a bold and beautiful plane.  Now all they have to do is ship it (no small feat, I hear the carbon fiber parts aren’t fun to manufacture).

Mulally seems, therefore, perfectly suited to follow through on Ford’s “Bold Moves”.  He’s the kind of person who seeks out a vision, and can get a whole, huge corporation behind it.  To paraphrase an old Ford advertisement, maybe Mulally does “have a better idea”.  The family and shareholders are certainly betting on it

Mike Rowe

Recently I discovered a fun television show, Dirty Jobs with Mike Rowe on the A&E cable network.  In this show, Mike travels the world to spend a day with people doing “dirty jobs”.  As the seasons have progressed (it’s in the third season now, celebrating its 100th episode on Sept. 5th), the jobs have become more obscure, and needless to say, more dirty.  He has done everything from the obvious garbage collector and sewer worker to more obscure jobs such as “avian vomitologist” (owl vomit collector — no I don’t know why).

Mike always gets dirty, always manages to have fun, and is usually a good sport when the people who hold these jobs make him do the most disgusting parts of the job.  But most importantly, through it all, Mike always manages to treat the people who actually do the job with respect.  As they say in the promos, these are the people who hold the jobs that make modern civilized life possible.  So, even though he jokes with them, they always come off as people with dignity — even when covered in poop.

Watching this show is certainly a “dirty little secret” for me, but it’s more than simply that.  I find myself watching this show and wondering why the people who do these jobs continue to do them.  How do their managers motivate them?  What kind of incentives can you give someone to climb in a pen with 250 five-foot long alligators, day in and day out?

Most of the people aren’t just doing this for a summer job from college, they are, often as not, long-time veterans.  These are people who not only do these jobs most of us wouldn’t even touch, but they do them for decades.  How is that possible?  And what does that teach the rest of the managers in the world about motivating our teams?

I don’t think it’s about the money.  Certainly there is evidence that you can get people to endure lousy jobs in horrible places for lots of cash.  The oil fields of Iraq or northern Alaska come to mind.  But most of the jobs Mike looks at are not these jobs.  These are regular folks doing nasty jobs for reasonable money.  It has to be about something other than money.

And I don’t think it’s because it’s the only job available, or even the only job they know.  Quite often, the people who are doing the jobs are college graduates, who have a choice of job and location.  They have chosen this work!

No, these people are doing it because there is something about these jobs they really enjoy.  Maybe it’s because they get to work outdoors, or work quite independently, or work with their hands, or work with people they like, or perhaps do something at which they know they are the best in the world.

In fact, I think this show teaches a very important lesson to managers: people choose to work at their job for quite individual and personal reasons.  And it’s extremely important for their manager to understand those reasons if they want to keep them happy and motivated in the long term.

As a manager, it can help to ask yourself why you are working there, and try to reflect carefully on why your people are there.  Perhaps you work in a non-profit where there are altruistic motives that help, but there are also many other factors: organizational climate, intellectual challenge, comraderie, industry reputation, and yes, money.  And it’s different for every person there.  It’s truly important that you know what makes your people tick, if you want to keep them there and motivated in the long term.

So, when you are trying to figure out how to make your team run better, perhaps you can take a lesson from Mike Rowe and look for the place of respect.  Look for that something in everyone that makes them want to climb out of bed and come to work.  And work to make that one thing better for each of them every day.

James McNerney took over as CEO of Boeing a little more than a year ago.  But you haven’t heard much about him for the last year.  That might lead you to think he’s not been busy.

But he’s been doing what any good deciple of Jack Welch would do when taking over a company — “deep dives”, taking a long hard look way down in the organization to see what he inheritted.  I’m sure it was an eye-opener.

Jim McNerney

Boeing has taken a lot of hits for a long time, not just in the recent ethics scandals.  In Seattle, Boeing has been ridiculed as the epitomy of bloated big business.  One nickname from the late 20th century was “the lazy B”.  Around here, you can pick out the Boeing employees just like the Microsoft ones.  They are stereotypical nerds all, differing largely only by the generation.

The tens of thousands of proud Boeing plane builders are local fixtures, and their relationship with company management has been rocky since the beginning.  Not aided by a argumentative union (see my post on that here), the ebb and flow of the company’s fortunes take the larger local economy with it.  This effect has been lessened, but by no means removed, by the additional of software and biotech to the local scene.

Boeing’s relationship wtih Seattle hit a big low, when the former CEO Phil Condit made the rather absurd move to take it’s headquarters to Chicago.  This choice was ridiculous because the company had essentially no business operations nearby (and was shuttering those it did have).

In an amazing show of hubris, Condit held a public contest to see which city would give the most largesse to Boeing for moving their headquarters there.  In an over-hyped press event, the company selected Chicago while on board a Boeing jet headed for…  may I have the envelope, please…  Chicago!  It was a ridiculous spectacle, it moved less than 0.1% of the employees there, and (rumor has it) was only done because Condit and his wife wanted better restaurants and night life.  The reasoning was to put them in the middle of their customers, within a short flight to them all.  But, in point of fact, their largest growth market for the company is the Pacific Rim, and Seattle is far closer to those customers.  Yet another reason why Condit is long gone.

All of this makes McNerney’s challenge even more important especially to those around here.  He needs to restore a sense of sanity in a company that seems to lost its way much like Enron, Worldcom, and the other famous debacles of the end of the last Century.

His biggest challenge may well be finding a a way to get this behemoth, famous for everything from commercial aircraft, huge government contracts, and questionable ethics, to focus on something…  anything.  The company appears to be involved in all manner of large military and aerospace projects and master of none.  As I have said repeatedly, focus on some vision, any vision, is important.&nbs