The Cost of BAD Leadership

NPR just published a great article about the impact of “toxic leadership,” something that I think we all would agree is a problem, and not just in the military. (Army Takes On Its Own Toxic Leaders)

Aside from the horrifying findings of the research (toxic leaders playing a role in the suicide of our soldiers), the article paints a vivid picture of a very special type of leader, one that I have encountered in many places. The article speaks to a new definition printed in the Army’s leadership bible (Army Doctrine Publication) that most, in and out of the military, can relate. What’s interesting is that the Army went to significant pains to describe what leadership isn’t. In doing so, they’ve painted a vivid picture of what most of us have encountered somewhere in our career and hopefully use that experience to learn what not to do similarly to the Army’s efforts with their definition of “Toxic Leadership.” (Army Doctrine Publication 6-22)

The Army’s definition, while wordy (like most military regulations) can best be summed up in its first line:

“Toxic leadership is a combination of self-centered attitudes, motivations, and behaviors that have adverse effects on subordinates, the organization, and mission performance.”

Have you ever run across someone like that who was in a managerial role? Someone who saw their employees, and likely their peers as a means to an end, typically an end that was completely self-centered in nature? If not, consider yourself fortunate.

So what is the cost of BAD leadership? In corporate America, we might see bad leadership tied to suicide but I personally think the suicide being committed most often is committed by our corporations rather than the employees subjected to it and what’s worse, it’s usually a slow suicide.

The cost of bad leadership can be measured in results, but more importantly the costs can be best measured in terms of results compared to said effort. Far too many organizations turn a blind eye to bad leadership because the bad leaders get results. How many times have you heard (or maybe even thought to yourself) “we can’t get rid of him; he gets results.” Maybe the thought should be “what is he costing us in terms of results we could be achieving?” These managers often do deliver results in the short-term but at a significantly higher cost than necessary. In many cases, those costs go far beyond hard dollars which is why they are sometimes easy to overlook. The real costs are frequently soft dollars that are harder to measure but carry much more impact.

Setting aside the emotion laced conversation of suicide, simply replace that with voluntary resignation or complete disengagement (quitting without leaving). Bad leadership negatively impacts the investment made in every new hire (military or corporate) by limiting the potential return (outputs) from that investment and significantly impacting the life cycle of the asset itself (separation or quitting without leaving). Longer-term, though suicide may not be a typical result of bad leaders in corporate America, the damage it does or can do to our current employees and future leaders is significant.

What makes bad leaders even more dangerous is that they tend to be very good at convincing those above them that they are good leaders and end up capitalizing on that false perception and get moved to even higher levels of responsibility. Their damage, then, is not localized and much harder to repair once discovered.

So what do you do about “toxic” leaders? I suggest that you treat them as what they are, a toxin. With toxins you usually have two choices, cut it out along with the damaged tissue (other infected leaders) or isolate the toxin by surrounding it with positive leadership and mitigate the negative impact. Most importantly, you have to deal with toxic leaders or like a real toxin in our bodies, the damage spreads and the longer it remains, the faster and deeper it spreads and dealing with the issue becomes more difficult.

So the question of the day is, do you have any toxic leaders?

Performance Management is Dead…–Long live performance management!

Necessary evil. Pain in the rear. The management penalty. Performance reviews are called many things, few of them positive. What’s up with that?? One of the most important things we do as senior managers is setting, and managing to, performance expectations.

Why, then, do we anguish about it so?

The problem, of course, is we frequently confuse performance appraisals with performance management. We make the appraisal process so damn onerous that no one wants to do anything but the appraisals… forgetting, of course, why we do those silly things in the first place.

It’s because we don’t take ownership of the process. It’s not the form we use, the rating scale identified, nor the percentage of pay increase associated with various rankings. It’s that we just don’t see the process as significant in our pursuit for business success.

And that’s just wrong. The capital markets continue to get stronger – both debt and equity. Initial public offerings are coming back in style. The DOW is headed back up. It’s not about all the “other” resources anymore – it’s about the people.

People make us competitive, successful, and allow us to differentiate. Believe it, get used to it, and embrace it. It’s here to stay.

Having said that, what, then, do we do about those dreaded reviews? How can they help?

People want feedback. You do, your boss does. Your staff does as well. A good performance review is nothing more than feedback–feedback that you should be giving all along anyway. So, here are some tips to make the performance review process bigger, better, stronger, faster…

  • Get it off-line. We don’t need the speed of digital; we need the effectiveness of face-to-face. Make an appointment; sit in a chair next to your staff member, and talk. Really; people have been doing it for years. It doesn’t hurt nearly as much as you think.

    Realize that the goal here is not a form… it’s managing/improving performance. Oh, yeah… we sometimes get so lost in the process, that we forget the real purpose. To manage and improve performance.

    Let’s don’t attempt to simplify so much that we lose sight of that objective.

  • Make it work, and then leave it alone. Everyone – I see this all the time – is constantly reinventing, changing, and modifying their performance review process. It’s just a form, people.

    Furthermore, the choices are actually quite simple; there are only three performance results:

    • (a) Doesn’t meet expectations,
    • (b) Meets expectations, or
    • (c) Exceeds expectations.

    All else (in my opinion) are provided for comfort and conflict mitigation, not accuracy. More rating choices enables poor performance management, in my mind. The key is in the conversation, not the tool or the ratings, so don’t spend an inordinate amount of time here.

    Performance management, conversations, dialog, and setting expectations ARE keys, so there’s the real focus. To that end…

  • Train your managers. It needn’t be a two-day seminar, but give your managers the communication tools they need to do this effectively. Your success – and your company – depends on it.

  • Use performance reviews as the foundation for year-long conversations about performance expectations and management. Set clear measurements. Revisit them frequently. Give periodic metric updates. Prevent surprises and manage performance in real-time. Help managers learn how to manage performance  through conversations first; reviews, then, merely memorialize  those performance conversations.

Performance matters. We all know this intuitively, yet we wrestle with the best way to manage that performance in our workplace. Own the process, decide that it’s about success, not perfection, and schedule that conversation.

Our success depends on it.

That Vision Thing

The name Tony Dungy may ring a bell for many of you, but his name may not be readily paired with the following quote:

“The first step toward creating an improved future is developing the ability to envision it. Vision will ignite the fire of passion that fuels our commitment to do whatever it takes to achieve excellence. Only vision allows us to transform dreams of greatness into the reality of achievement through human action. Vision has no boundaries and knows no limits. Our vision is what we become in life”

While Tony may not be recognized by most as a leader of organizational transformation, I’ll bet that most of the players he coached along the way might disagree. The lesson in Tony’s words is summed up as “vision is where transformation begins; it provides both the destination and the inspiration needed for successful transformation.”

So what is this vision thing? In simplest terms vision can be defined as a “unique image of the future.” It is imaging what is possible–and then telling others. It begins in the mind’s eye–it is visual, not verbal—and it uses imagination (something many of us haven’t used for a while in our daily work).

Walt Disney was a great example. He died shortly before Disney World Florida was opened. The president of Disney introduced Walt’s widow Lillian Disney at the official opening with the words “I only wish Walt could have seen this.” Mrs. Disney walked to the podium and uttered just two words “He did.” The clarity of Walt’s vision for what could be is what inspired Walt’s brother Roy, to ensure that Disneyland ended up as more than just a vision.

Some belittle the concept and refer to it as the “vision thing.” Interestingly enough Bennis and Nanus discovered in their research that “attention through vision” was a key strategy in their study of the top 90 business leaders. So there must be something  to that “vision thing.”

Here are some things to know about the power of vision as the cornerstone of transformation efforts.

  • It differentiates your organization from others
  • It helps in attracting, inspiring and retaining employees and creates a uniqueness that fosters pride
  • Vision works the same way with customers as it does employees
  • Vision is a powerful tool for giving investors something to believe in as the future is created

Effective leaders don’t simply impose their vision on others; they recruit others to a share vision. Especially in our digital age, when power tends to coalesce around ideas, not position. Selling and engaging others with a vision that contrasts the present with the possibility of a different future provides hope and it is hope that drives people to behave differently and to take action to help the vision become a reality. Discretionary effort ensues.

So how then does a leader access this “vision thing”? It starts with a word: Neoteny. Defined as “the retention of youthful qualities by adults,” it is actually much more. Neoteny is a Greek word that literally means the retention of those wonderful qualities that we associate with youth. Qualities like curiosity, eagerness, warmth, and energy. People are attracted to realistic optimism–it gives a leader the power to recruit others to buy into what they see.

By the way, this “vision thing” is not about words on a wall in the reception area. This is about the pictures that employees carry in their heads, pictures that inspire, direct and drive them as part of something bigger than themselves.

With a clear vision in place the only other things needed are the commitment and determination to continually reach toward the vision when it would be easier to go back to the way it was. So spend some time thinking about the vision that you carry in your head, articulate it and then spread it. Leading transformation starts with the leader seeing that “what is”  is no longer an option, and then developing clarity about what is to be and then communicating the heck out of it. That is how championship teams and businesses are created.

Organizational Transformation

Albert Einstein once said that the definition of insanity is doing the same thing over and over yet expecting different results. Organizational Transformation breaks through that insanity. It’s not about working harder—I remember working with several clients during the economic challenges of recent years, and helping them realize that working harder can only “fix” problems when not working hard caused the problems in the first place.

And who was going to admit they weren’t already working hard?

Transforming an organization is not simply improving results, no matter how significant. Organizational Transformation is about being a different organization, not just a better one. It’s change on steroids… that “step-change” that leapfrogs an organization into an entirely different—and better—place.

Organizations wanting to adapt, change, or transform cannot force such change through simple technical modifications like reorganization, re-engineering, or the like. You certainly cannot “save” your way there, nor create a budget or forecasting model that will do it. No, you can’t “spreadsheet” into transforming an organization.

This isn’t a quantitative exercise. If it were, I’d develop a do-all Excel spreadsheet for “Transforming Your Organization.” You would simply plug in your numbers, hit “calculate,” and out would come your winning formula for successfully transforming your organization. I would charge a bazillion dollars, have a private island in Tahiti, and wouldn’t invite any of you to come visit.

Don’t we wish…

To fundamentally transform an organization, you must first embrace a new way of leadership performance to better understand and address challenges and interpret business movements.

How does that happen? In my view, Organizational Transformation needs three elements to succeed:

  1. A clear direction, with equally clear expectations and specific goals. If you don’t know—or can’t clearly articulate—where you’re going, don’t expect to see a throng behind you;
  2. An engaged workforce; we’ll need massive quantities of discretionary effort, and the ability to discern positive directions without incessant oversight. That only comes from a workforce willing to do the right thing for the organization, with or without your immediate presence;
  3. Changed leadership. To change a culture—we must start with leaders. That’s just the reality. Leaders capable of moving the proverbial needle closer to transformation must first transform themselves, focusing less on operational leadership and more on focusing on flexibility, collaboration, and “collective” leadership.

There’s nothing inherently simple about Organizational Transformation, but neither is it beyond the reach of any organization. It takes vision, fortitude, and resolve. In other words, you’ve got to want it—really want it—to get it. Start there, move forward.

Coming Together — The people side of merger integration

One big, happy family… right?

Executive Coaching on Merger Integration

Bain Capital. McKinsey. Deloitte… don’t take just my word for it; the single biggest reason for merger or acquisition failure is NOT costs, lack of synergy, incompatible strategy, etc.

It’s people. Failure to integrate cultures, directions, leadership and communities within an organization result in more failures than any market disapproval could muster.

Pay attention here: you’re paying big bucks for – usually – more than a simple asset. Realistically, even simple “asset purchases” are hoping for more than a simple Return on Asset; we’re always hoping for bigger, better returns that can only happen through the newly combined workforce talent. Again, “people.”

Let’s get right to it. I’m assuming you’ve competently determined that the merger or acquisition is a logical addition to your business. The technical part is fairly simple… a bunch of spreadsheets, a month or two of due diligence to verify the lofty promises, assurances, and statements from management. Now, let’s work on the more fickle side…

The most important thing to remember is communication.

Frequent, informative, helpful communications. The initial merger time is the most critical, since many of the employees in the acquired company will “overthink” the event, and may believe they will be summarily replaced.

Or, more important to key performers, that they’ll lose their “key performer” status.

Frankly, you may actually WANT to lose some of them, but don’t you want the opportunity, at least, to have some input to who stays and who goes?

If you intend to make cuts, announce them and do them quickly. The longer it takes, the worse the retention results. Be sure, if staff cuts will occur, that they occur on both “sides” of the merger equation, if you really want a successful post-merger story.

Read this closely: the longer you take to make the “who stays and goes” determination, the more high performers you lose. It really is that simple. Mediocre and poor performers simply fret endlessly, duck for cover, and hope to go unnoticed.

High performers don’t look at life – or their careers – that way.

And they have no intention of waiting around to see if you’ll give them a thumbs-up or thumbs-down. These people are infinitely employable, have probably got feelers out already, and in the absence of anyone helping them do differently, will look out for their own well-being.

Even to your detriment.

Next, assess the acquired company’s culture and strengths, and make the determination on what “works” for you, and what doesn’t. Once you determine what the “combined” culture will look like, no compromise — on either “side.”

Read that again. No Compromise. On the bus or off the bus. No one rides along for sightseeing. If someone – particular if influential and/or in leadership – gets to publicly buck the “new deal.” Like the three musketeers, it’s “All for One!.”

Remember — and this is ultra-important — there can only be ONE culture. Anything else will lead to fragmented actions, loyalties, and lack of direction.

Finally, be frank and open with the process. The worst thing that could happen is that the acquired employees lose trust in your integration process – they already ‘suspect’ you may not have their best interests at heart.

If my concepts above aren’t specific enough, here’s some detail on crafting a successful integration:

  1. Create an employee integration plan immediately. It takes hours, not days, don’t dilly-dally. Communicate that plan to others (both ‘”sides”).
  2. Execute to that plan immediately, quickly, and strongly. Patton was correct: “A good plan, violently executed now, is better than a perfect plan next week.”
    Time is not on your side here. The longer it takes, the worse the outcome… guaranteed.
  3. Decide where you’ll compromise — and where not — and hold firm.
  4. Communicate, communicate, and over-communicate. Rinse and repeat. Even “nothing new to report” is better than silence.
    People fill ‘unknowns’ with their own “knowns,” and they are generally not the information you’d prefer them using to make decisions.
  5. Clearly define roles, accountabilities, reporting relationships, and performance expectations. It’s the very core of the employee agreement.
  6. “It ain’t over ’till it’s over.” Don’t declare integration ‘victory’ too soon.

Prematurely hailing success has killed many an integration, as a couple of key people/groups look around and say “not from where I sit, bubba.”

Good luck. Fun but challenging stuff…

But that’s just me…

Rewards for Doing Your Job — Why would I do that?

But, Kevin, that’s his job!

An exasperated client exclaimed this to me after hearing—again—that she should get better at recognizing her folks, and to consider using regular accomplishments as the impetus, versus waiting for the one-off spectacular event.

She disagreed strongly, obviously. She felt that if people were just doing their job, they weren’t doing anything exceptional, ergo no recognition warranted or expected. “Their paycheck is a reward for satisfactory behavior,” she said. I’m sure no one reading this has ever uttered those words.

“Wrong,” I told her. “That’s just flat wrong.”

Since she is a football fan (assuming you actually consider the Jacksonville Jaguars “football,”), I used a football analogy…

I started playing school football in 8th grade. Mine was a small school, so most of us played both ways; I played right-side offensive guard and defensive linebacker. This is Texas school football, so believe me, they took it as serious then as they did through later years in high school.

Our starting quarterback was a guy named Gordon Williams, the son of our football coach (I’m sure that was just a coincidence). Gordon and I were friends before football came along, as we lived about 8 houses apart in a town of 4,500 people.

Anyway, we were playing La Grange, Texas (yes, the home of the famed “Chicken Ranch”), and we were trailing by a good margin. Gordon called a running play, handing the ball off to Albert Cubit (at the time, the fastest human being I’d ever seen), who headed straight for my right leg. My job was to pick up the middle linebacker who had been coming across unscathed most of the game.

And pick him up I did. Nailed him in the chest, likely surprising the daylights out of him, since I’d been something of a slug the whole game until then. Ended up laying squarely on top of him, while Albert pranced merrily into the end zone. Touchdown, Luling Eagles.

Now we were all happy, jumping up and down, slapping each other’s helmets (this was well before chest bumps and man-hugs), but Gordon cut through the crowd and the noise to reach me, grabbed me by both shoulders and said — yelled, actually—”Great job! Your block made this happen!” I beamed, I’m sure, like some stupid-looking 8th grader.

It wasn’t that I didn’t know I blocked, because I did. It wasn’t that I didn’t know we scored, because of course I knew. It was because I didn’t know how what I did actually affected the outcome.

You see, I was face down on top of that linebacker, and just assumed that Albert had done whatever magic he did when he had the ball. I didn’t realize that the team’s success at that moment was a direct result of my efforts. And all I had done was what I was supposed to do. I didn’t block two or three people, or chase down some errant interceptor. I simply blocked the one person I was tasked to block for that play.

And the team’s leader made me feel damned good about it. It’s been over 40 years since that game; I don’t remember any other play, game, or conversation. Heck, I have no idea of whether we won or lost to La Grange that afternoon. What I do remember, like it was yesterday, was Gordon Williams grabbing my shoulders, looking me in the eye, and saying “Great job!”

For “just” doing exactly what I was supposed to do.

“That which is rewarded is repeated.” It’s a basic tenet of compensation, and the foundation in changing human behavior. Don’t delay or save recognition in hopes of rewarding some heroic, superhuman event. Remember that blocking and tackling—the business kind, not the football kind—is what makes organizations and their leaders successful today. Show ’em some love.

But that’s just me…

(…and thanks, Gordon)

At C-Level

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