Mehran Assadi is an island in shark-infested waters.
Assadi leads National Life Group, the fastest growing life insurance company in the country over the last decade with, according to Scott Mautz’s article in Inc., employee engagement levels and agent retention four times the industry average.
Read that again… Retention four times the industry average. How much is that worth? Damn.
How does he do it? Simple. He says “people first.”
“Wait,” you say. “That’s nothing new, Kevin.” Yeah, well, what is new is that he means it. He lives it. And he leads from that singular position.
Assadi steadfastly insists that their culture is bigger than individuals, and bigger than him; it is tangible and shows up at the top line, bottom line, and every measure in between. He claims their culture is the secret sauce to their success. It’s not perfection—it’s learning as they go, and they are getting better every day.
Now, keep in mind that this guy is working with a 150+ year-old company here. This isn’t some upstart start-up trying to make it big. It’s an established organization in an industry not exactly known for brilliant innovation or trend-setting in the culture department.
He’s a big believer in servant leadership, insisting that leadership is a privilege, not a right or entitlement. There’s some cutting-edge thinking, Lou, and uncommon insight for a financial services CEO. Further, he insists people care for–and know—themselves.
To quote Assadi, “When you find your ‘why,’ you find your way.”
Six years ago, he started a once-a-year process of collecting feedback for their top 200 leaders, from at least 20 people each, on how they were faring as a servant leader. Not coincidentally, the same year they started doing this, sales began increasing every year–by double digits.
Go figure.If all that’s not enough, he shows the LOVE. In fact, L.O.V.E. at National Life Group has come to mean “Live Our Values Everyday”.
Nice touch, Mehran, and a big reason you are July’s Leadership Leader.
Leadership Milquetoast
PepsiCo Inc.’s longtime honcho Indra Nooyi is sort of shooting herself in the foot.
Now, before anyone leaps prematurely, I’ve been a fan of hers for some time. She’s been solid, a progressive and people-centric CEO, and kicked serious butt in financial performance. There are precious few women in that Fortune 100 role (7, at last count), and she’s had the chair long enough to damn sure prove her mettle. In corporate performance, at least. In succession planning? Not so much…
You know, the better you perform, the more that is expected. And it’s logical for expectations for Nooyi to be high. And her recent announcement/non-announcement of a promotion was clearly not her best work.
Congratulations go out to Ramon Laguarta, currently grand poobah at PepsiCo’s Europe and sub-Saharan Africa business, as he transitions to the company’s President role. The gig includes global operations, corporate strategy, public policy and government affairs, not a small swath of responsibilities.
Then, she simply dropped the ball, announcing that Mr. Laguarta shouldn’t be presumed her successor. “There is no heir apparent,” she said. “When the time comes for succession, whenever it is, I think the wonderful thing is our board is going to have so many people to choose from.”
Yeah, well, I’m calling bullshit. This is a lousy way to plan for succession, and she should know it; she already lost a couple of key CEO-contenders. During Nooyi’s 11-year ride, two viable successors have been promoted into that No. 2 role, and subsequently left the company.
Look, Nooyi’s only 62, so there’s no dramatic rush for succession. But you can’t promote the best, tell them to sit still, and tell the world “this means nothing, long-term,” and expect them to stick around quietly with their thumbs up their derriere waiting for your eventual career plans to be revealed. Talent management—succession planning—simply doesn’t work that way. You don’t have to promise them the job, but to take special effort to say “he’s not the guy” is a bit much, and counterproductive.
That President job has been vacant since the 2014 departure of Zein Abdalla, someone clearly identified as “shortlisted to become chief executive.” He kept the role for two years before his abrupt, unscheduled retirement, which occurred shortly after Nooyi lost Brian Cornell to Target (another identified successor). Before Abdalla, John Compton stayed as Pepsico President for less than a year, before assuming the CEO of Flying J Oil Corp.
Houston, we have a problem. Nooyi has to develop a process for developing and promoting within a non-guaranteed succession plan, that motivates potential successors to stick around, not bolt for the door.Saying, “he ain’t the guy,” is likely not the way to do that. You’re better than that, Indra Nooyi, and this strange non-succession succession plan makes you this month’s Leadership Milquetoast.
Leadership Laggard
Steve Ells, Chipotle’s CEO is in hot water—again—for contaminated food. This time, 135 or so sick customers, with at least two contracting the norovirus. This marks the 7th – SEVENTH – incidence of norovirus disease contracted at Chipotle since October 2015.
The SEVENTH!
That’s not even counting their other woes, like poor financial performance (apparently caused by guacamole. Seriously), and their massive data breach just a few months ago.
Crap like this, folks, does not occur in a vacuum. Generally, when leadership is poor, it shows in multiple areas, not just operational performance. I believe we can safely say that Chipotle leadership is poor.
This piece is short; we covered much of this when Steve was our Milquetoast in January, but thanks to 135 more sick people, he’s “done graduated” to our Leadership Laggard for July… Congrats, Steve.
I coach several individuals; most at a fairly senior level, some in mid-management.
Some are remedial efforts; in other words, we’re trying to get an otherwise-valuable employee to step it up a bit in performance. These are challenging, but it’s positively great to watch the progress.
The rest are for those already operating near the top of their game. Those folks for whom we’re trying to give them that “extra” edge. That 1% improvement for which, in their hands, makes a significant difference in the success of the business. (more…)
Someone recently asked me why the Performance Management process seems so painful in many organizations. They further questioned how lower-level managers could possibly implement effective performance management if the senior executive(s) are less than fully compliant themselves.
Man, oh man, do I have an opinion on this…
First, lower level leaders in an organization don’t get a free pass simply because some senior executive isn’t up to par. Leadership accountability is bigger than a simple reporting relationship.
If subordinate managers got an accountability “walk” every time more senior leaders were errant, we’d have but one or two accountable people in every organization, followed by a bunch of well-paid drones.
Sorry, Charlie. You have the position, you cash the check, and you have the personal accountability.
Next, performance management isn’t really difficult at all; most reasonably successful leaders/managers do some form of this on a regular basis. Think about it – for those who do not have a real formal process, do you still work on employees to improve their performance? For those who are late turning in those annual reviews to HR, have you been ignoring your employees all this time?
Of course not.
It’s the review process that’s typically broke all to hell. And frankly, that’s a system issue, not (necessarily) a leadership failing. In other words, most performance reviews exist, not for performance management, but for performance management documentation.
That’s not necessarily a bad thing, but we too often attempt to have those reviews do so much more than documentation. And if we do that without training all involved (both sides of the review equation) and without fully institutionalizing the process, well, we get what we usually get.
GIGO at its finest.
If an organization is reasonably successful, there’s probably a decent amount of effective performance management occurring.
Further, if that reasonably successful organization has a painful performance review process, then we should stop that right now… the review process should aid in performance management, not merely memorialize it for posterity.
Benno Dorer is a Rockstar. He was recently recognized as the highest-rated CEO by Glassdoor in its 2017 Employees’ Choice Awards, surpassing Elon Musk and Mark Zuckerberg in the top 10 list.
Now, let’s get something straight here. I’m neither for nor against glassdoor.com, but at least theirs is based on relevant, first-hand input, not like some of the myriad “great places to work,” and Fortune’s “here are our favorite companies” listings. Glassdoor is a website where current and past employees get to rate their employer, including specific ratings and comments for the CEO. For the record, I always take at least a cursory look at glassdoor.com ratings when speaking with a new or potential client.
A fairly valid grading system, and Dorer clocked in at 99%. NINETY NINE percent!! I’m impressed at anything above 80, so this is rarefied air indeed. And he blew right past all the Fortune favorites and greatest places reviewers hoping to snag a client—he scored well above Zuckerberg, Musk, Bezos, et al.
And before now, who had even heard of this guy, specifically by name??
By the way, lest you fall for the myth that popular (read “nice”) leaders must be milquetoast business managers, know that Clorox stock has increased in value by almost 40% since Benno took over in late 2014. That’s just two and a half years, for the mathematically challenged among us.
Dorer is the real deal. When notified of the award, he said the title was humbling and “gratifying in a sense that I take it as a vote of confidence from our employees in the direction we’re taking the company.” While we’re quoting the guy, he also said:
“A good leader is someone who ‘has a point of view, has a vision of what can be accomplished and enrolls others in that vision and helps get barriers out of the way.’”
“Diversity and inclusion is something that is good for employees and also good for business.”
“As leaders, employees expect us to make the tough calls, and empower them make tough calls themselves. Employees want us to be decisive.”
“We measure employee engagement and… my own pay is determined by that engagement level…”
(Re-read that last one—his pay is determined (in part) by employee engagement levels!)
“What I care about is results, versus how many hours you put in.”
Now, read this last quote, because it sums up everything Dorer does to exude successful leadership in a nutshell, “I leave it up to my people on how they accomplish what it is we want to accomplish. So, try to empower people to do what they can do best–I try to stay out of their way–and create a real supportive environment.”
To do that, senior leaders must be confident; not just in themselves, but in their vision, direction, veracity of strategy, and ability to discern results and outcomes quickly. In other words, they must be confident to lead.
And Benno Dorer clearly does that solidifying his position as this month’s Leadership leader.
Milquetoast
Sally Smith, CEO of Buffalo Wild Wings
When investors get antsy, senior executives get defensive. That’s not necessarily a negative leadership response, if that leads to action that makes the company better.
It is a poor leadership response if they start blamestorming for their failure to respond to changes in the market.
Enter Buffalo Wild Wings. Along with many other restaurants of their genre, BWW has been suffering from declining profits over the last few years. Why? According to the CEO, Sally Smith, it’s the Millennials’ fault.
No, really. Apparently “millennial consumers are more attracted than their elders to cooking at home…”
Note: I unscientifically polled 100% of the millennials in my household and found no evidence to support Sally’s claim.
Granted, she also whined that shopping mall traffic was down – a blinding flash of the obvious – and added declining viewership of sporting events as a contributing factor to BWW’s woes, but why did she think excusing her management team’s failure to adapt to a changing market was going to appease the shareholders?
Hey, Sally, here’s a reality check: the BWW customer experience has been in decline for the last half decade in some pretty important categories (food quality, service, cleanliness, and menu variety to name a few). You can cherry-pick statistics all you want, but that doesn’t mean BWW didn’t rank in the bottom quartile in every surveyed metric in the 2016 Nation’s Restaurant News Consumer Survey for casual dining restaurants.
Being dead last in the Overall Guest Experience category – including the bottom 10% of food quality and service – doesn’t exactly build confidence that senior leadership is paying attention to what it takes to get people to eat in your restaurant.
I’ll concede that BWW’s latest foray into food delivery service and a fast-food version of their restaurant (B-Dubs Express) shows they’re paying some attention to changing preferences, but that’s reactionary, not visionary. And that kind of leadership is definitely not going to convince people to come out to eat bad food, drink and watch sports on the big screens… not even us Boomers.
Sally Smith’s classic failure to accept responsibility for her leadership team’s lack of vision nearly made her this month’s Laggard, but she lost out to the competition (see below). So congrats, Sally, you’re the Triangle Performance Leadership Milquetoast for June 2017.
Laggard
Cheesecake Factory CEO, David Overton
Look, Davie here is also the founder, so he’s not going anywhere, but he could damned sure use a lesson in accountability. When revising downward his quarterly analyst’s forecast, he blamed the weather—yes, the WEATHER—for the decline in sales.
May not be as bad as Buffalo Wild Wings’ millennial crap, but it’s awfully close.
Yes, this is the same Cheesecake Factory you’re thinking of, with the two-ton sandwiches, 250-item menu, and restaurants so dimly lit you could catch lunchtime zzz’s after the carb overload. A meal there makes anyone feel like Mr. Creosote — the “better get a bucket…” guy from Monte Python’s Meaning of Life. I’d include a youtube link for that part, but I’d catch too much flack, so you can look it up yourselves.
THAT Cheesecake Factory.
And Overton is seriously claiming that weather in the East and Northeast reduced patio useage to the point it effected year over year sales. Yeah… right. I was born at night, but not LAST night.
Sure, Dave, maybe weather was bad. Maybe somewhat fewer gluttons dined on your outdoor patios. Or maybe, just maybe, your leadership needs a tuneup. Consider:
Over the past six months, the industry has gained 8.7%, while Cheesecake has lost 14.8%. Surely yours wasn’t the only patio effected.
The failure of your March value menu insert, ~10 items below $15, highlights the inability to drive incremental traffic.
The weak summer box office is problematic, given Cheesecakes’ proximity to movie theaters.
Increasing Costs: Cheesecake Factory was planning to open eight new restaurants in 2017 and is anticipating a 5+% increase in labor costs. Wage inflation has continued this year.
By the way, something else to consider… Though the Macaroni and Cheese Burger, Topped with Creamy Fried Macaroni, Cheese Balls and Cheddar Cheese Sauce SOUNDS simply decadent (almost 1,500 calories), that fare may be headed the way of the dodo bird.
Stock fell 10% overnight upon the “weather” announcement, so it seems investors were calling “bullshit” as well. The stock is near 52-week lows, and still 15% below that fateful announcement date.
Incoming Chief Financial Officer Matthew Clark (he’s not the “regular” CFO until July 7) said despite the climate impact, the company still expects same-store sales growth of 2%. Good luck with that, Matt, and best wishes on the new job. Hopefully, you’ll do better than Winnie the Pooh’s “The rain, rain, rain came down, down, down…”
As it is, your boss, David Overton, used the weather as a reason to avoid personal accountability for strategies and decisions that should be reconsidered. As such, he wins our Leadership Laggard for June.
Travis Kalanick is a jerk. Got it. His behavior was often juvenile, sometimes egregiously so. Got it. He got whacked because of that harassing and intimidating behavior. I got it—he’s a tool. But what does all that mean?
I’m reading all these articles and newly-minted pundits jump on the Uber-is-dying bandwagon. “The culture is shot.” “The entire management team must go.” “No way they can recover.” The list of attacks is endless, and helps us all understand the real meaning behind “blood in the water.” Some people smell it, and they want to help that alternative reality materialize.
Yeah, rotsa ruck with that.
To paraphrase Mark Twain, methinks the rumors of Uber’s demise have been greatly exaggerated.
Yes, some things need to change—as is true with all large organizations, particularly in the tech space. A brief google search reveals current lawsuits and EEOC claims for sexual harassment (and other employee transgressions) against Apple, Microsoft, Tesla, google, facebook, twitter, and just about every other deep-pocketed company, many of those name some very senior (C-level) executives.
This doesn’t normalize or excuse Kalanick’s boorish (and potentially unlawful) behavior, but frankly, Silicon Valley doesn’t have the best reputation for stellar employee treatment. Their diversity records suck, women and minorities are routinely marginalized, and I believe they routinely hide behind outlandish peripheral perks and a designer office environment (oops, I mean “campus”) to mask otherwise toxic behaviors and cultures. Kerry Flynn, writing for Mashable, says it better:
Silicon Valley’s worldview tends to applaud when founders move fast and break things. To this crowd, issues like gender discrimination are acceptable roadbumps for companies that are going to change the world. That’s why much of the industry tends to treat discrimination and harassment claims with a sense of dismissive detachment.
Props to Kerry – perfectly stated. All of this just goes to say that Kalanick was a tool, his personal behavior certainly didn’t represent Uber well, and his transgressions were neither new nor unique to the seemingly outraged observer community. Unsure why that translates into a complete destruction of an otherwise fast-growing company. Frankly, it shouldn’t.
Some things to consider…
Kalanick led the commercialization of real-time ridesharing. No, he didn’t actually invent the concept, his partner did (the obscure partner), but Kalanick is the one who made it viable and a household name. Who knows Ted Dabney? No one. He founded Atari Computers, but everyone knows Steve Jobs, who came along well afterwards and made it work. Similar to Kalanick.
Has he screwed up some of that? Hell yes. He’s had to change course with drivers, cities, legislators, et al, a dozen times. But he kept Uber growing.
Uber employs over 12,000 with revenues exceeding $6B. It’s currently worth nearly $70B. Kalanick did that, like it or not.
Michael Wolff in USA Today called Uber the Tech Company of the Year in 2013.
This allegedly evil company consistently (even today) outscores Lyft, Tesla, twitter and facebook on glassdoor.com. Whouldathunkit??
Uber ranks 4th in LinkedIn’s Top Companies 2017 Global Edition list, published just one week ago; trailing only google (actually “Alphabet.” who thought of that moronic name?), Facebook and Amazon. In fact, they improved their position from 5th in 2016. The Human Rights Campaign named Uber in their Best Places to Work 2016.
The company still has zero problems recruiting… People self-select where they want to work, oblivious to punditry and hater attacks.
It is – and remains – one of the most valuable startups in the world. 10 times larger than the nearest competitor, it’s growing rapidly in unchartered waters within a space being developed as we go. They are cutting edge, in almost every part of their approach and technology.
It’s a kick-ass company, and it’s not going anywhere.
Kalanick was a problem, no doubt. I don’t often support a founder in high-growth leaving, under almost any conditions, but I do understand it in this case. Not ideal for the business, but poorly managing media, PR and affected stakeholders can be a terminal error, as big as the harassing behavior that created the hooplah.
Anywhoo, he’s gone, Uber’s still here. To those who support, stay the course. To those who think the company has one foot in the grave… well, get used to disappointment.
Take the good, when available. Kalanick is gone, those who remain have a job to do, a company to run and a life to live. Take the good when you can, learn lessons from others, and at the risk of overuse of idiotic idioms, don’t throw the baby out with the bath water…
