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, reengineering, 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:
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;
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;
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.
We’ve been publishing our Leaders & Laggards coming up on two years, give or take. It’s been fun, if not sometimes a bit of effort. And I can’t say we always agree with who wins what, though generally we find common ground. Especially on the Laggards—they frequently make it pretty damned easy.
We thought it might be time for an update, so that’s what we’re going to do for the next few months: give you a clear Leader or Laggard (just one), then spend the rest of the space updating you on how a couple of those nefarious prior laggards are doing now, presumably after having some time to see the error in their ways and appropriately repent. Or not. So, without further ado…
Ok, this is a bit of a reach for a Leadership blog, but not really. Tipping — gratuities for service employees — has reached entitlement status, not much different than many current, regular employees.
This is interesting to me, as my wife and I are active consumers. We eat out frequently, do the Starbucks thing, and utilize service providers all the time in our daily lives — as do many of you.
Tips are extra – something on top of a bill for receiving something, literally, “extra.” I’ll tip 20-30% for outstanding service in a nice restaurant, particularly one that we frequent regularly. The level of service provided, then, is truly top-notch.
I’ll even tip 15% for mediocre restaurant service. If the server is neither abusive nor neglectful, I assume they are simply poorly trained, and will mention something to the manager – but still leave a respectable 15% tip. Let them be abusive or (in my mind) purposefully disrespectful, and fuhggetaboutit. I’ll leave the big “0” when necessary to make a point. No more scaling down from 15% or so.
We tip regular service providers, such as stylists, delivery people, etc., usually around 10%, depending on level of service and extenuating circumstances. Tips are both a reward for current service, and a notice of future tips for FUTURE service, so we use them judiciously.
But, and here’s the crux of this post, those tip jars in all the coffee joints and related places… are you kidding me??? I’m going to get out of my car, walk into the shop, wait in line, order and pay, then wait in line for my $4.25 triple-venti-nonfat-no-whip-mocha, and then put money in a tip jar??
What the hell for??
When pigs fly…
They recently opened a new Starbucks in my small hometown of Spring, Texas. The drive-in window – YES, THE DRIVE-IN WINDOW – has a tip jar on the little ledge that sticks out.
After giving my order, I tapped on the glass. The nice young lady slid open the window, and I said, “Excuse me, it seems you’re out of mints,” while gesturing toward that ridiculous tip jar.
IN THE DRIVE-IN LANE OF STARBUCKS!
And we wonder if this “entitlement” thing is real??
You didn’t have to do anything amazing in the last month or two to be our Leadership Leader for January. You just needed to demonstrate clear, personal leadership… and Muhtar Kent has been demonstrating it for years. He’s about to turn over the CEO reins of Coca-Cola, and we thought it appropriate to use him as reinforcement to what you leaders have been beat over the head with for years.
Disclaimer: my wife really likes Coke.
Kent, who was with Coke from 1978 to 1999 and returned in 2005 to take the helm in 2008, gets what being a leader is all about. And he understands that leadership development isn’t about unhappy participants sitting in a training room checking their iPhones. And it’s not about this unnamed group of sleepy yahoos, either.
Kent has described leadership development as a combination of “head knowledge and heart knowledge,” and the company’s development program is the kind that works – a group of high potentials who learn how to be a part of a leadership team, taken out of their comfort zone, exposed to pieces of the enterprise they didn’t know existed, and given company-related challenges to address during a six-week program. A contiguous six-week program.
Say what?? Six non-stop weeks away from work, away from most emails and calls. Not a half-day here and there over the course of a couple of years, but 30+ days without being at the office.
How is that even possible? It’s a simple matter of priorities, and leader development seems to be quite the priority at Coca-Cola with Muhtar Kent.
Coca-Cola‘s moved up 30+ places on the Fortune 500 since Kent became CEO (a place it hasn’t seen since 1997), and Coca-Cola currently sits at #15 on Fortune’s World’s Most Admired Companies list. Not surprisingly, Kent believes that the leadership culture gives the company a sustainable, long-term advantage.
Having started in the company driving around Turkey selling Coke, Kent says that “leadership is all about creating value in whatever you do—and whatever role you are in—and leaving something better than you found it.” No magic sauce, no fancy programs, just people-oriented leadership.
“Ultimately, leaders are judged by what they leave behind.” – Muhtar Kent, CEO, Coca-Cola Company
Congrats, Muhtar, you’ve left behind a culture that appreciates the critical contribution that leadership makes to a company’s success. We salute you as this month’s Triangle Performance Leadership Leader.
Leadership Milquetoast
Steve Ells, Founder and CEO, Chipotle
Chipotle… Foodie’s version of Tex-Mex, or petulant adolescent?
A refresher for those living under or near a rock: A highly publicized E.coli outbreak sent Chipotle’s results in a tailspin around October 2015, followed by a norovirus problem in December of that same year. In total, six illness outbreaks. Since then, the stock has dropped nearly 50 percent.
Chipotle HAS done some good things to rebound: implementing cutting-edge food safety protocols, increasing third-party audits, and — supposedly — pushing hiring levels to ensure good customer service during these labor-intensive changes.
What they haven’t done, is simply step up and say “we screwed up, we’re sorry, and we’ll do better.” Chipotle’s founder and CEO Steve Ells has apologized, a couple of times (though only grudgingly for the norovirus fiasco), but what hasn’t occurred is accepting full accountability for making some serious mistakes. It’s not enough to say “I’m sorry.” Accountability means you also say “we made mistakes.” Real mistakes, and we’re trying to get better.
The problem is how companies—executives—deal with mistakes, not the mistakes per se. And in this, Ells has screwed up royally. Since the E-coli debacle, here’s what he has blamed for Chipotle’s crappy financial performance:
Ells tried to saddle Monty Moran, Co-CEO for a time, for “not keeping it simple.”
Here’s the real deal: Chipotle and Ells (sound like the show Rizzoli and Isles) have done many of the things necessary to fix their food safety problems. But they need to fix their customer problem, and that’s not just about food safety. If Ells could get that through his burrito beans, he’d be better off. Without accepting full, unqualified accountability, it’s a missed opportunity.
Until then, he—and Chipotle—are our Leadership Milquetoast.
Layoffs are almost always attributable to poor leadership. In fact, they are so ubiquitous that merely laying off employees — no matter how tragic — hardly rises to the occasion of being awarded our leadership laggard.
However, in this case Macy’s CEO Terry Lundgren managed to dodge his way into dubious honors.
It’s one thing to say that our business model needs tweaking. Or that our direction may need to shift based on demographics, spending patterns, buyer preferences, yada yada yada. It’s another thing altogether, Mr. Lundgren, to say ”I’m sorry, there’s nothing I could do about it.” And that’s exactly what he did.
Seems Mr. Lundgren would have us believe that all of retail suffered this most recent holiday season, and that Macy’s was simply one of many impacted by this terrible economic event.
Oops. It just ain’t so.
You see, retail sales are up by almost 4% in 2016 over 2015. And in fact, several retailers did quite well, posting respectable increases in sales during 2016 and the most recent holiday season.
Online sales continue to increase, this year by another 12%. Newsflash: this is not new. Brick-and-mortar stores have had plenty of notice that they must shift their model to address this changing buyer. Just because you failed to do so, doesn’t mean you get to blame your failure on the economy as a whole.
So, while layoffs are certainly nothing new, and retail has always been a cyclical, precarious environment, the fact remains that nationwide sales increased, many stores succeeded (think Amazon, Walmart, Target, etc.), and Macy’s continued decline is a tragedy of their own making.
Look, I’m no saint. I’ve had to lay off people, sometimes a lot of people, and that represents failure on my part and the part of my fellow leaders. Again, as I mentioned earlier, layoffs are generally the direct result of poor or misguided leadership. That’s bad enough, but a travesty occurs when that same leadership decides to dance a jig around exactly who or what is responsible for that decline in sales.
And to Terry Lundgren, regarding his “not my fault” stance, I say liar, liar pants on fire.
And bestow upon him this month’s Leadership Laggard.
I have never been in leadership but I want to be a leader. How can I achieve this target?
Though straight-forward, your question has some depth of thinking…
Two things to start:
Be a leader where you are. Demonstrate leadership, empathy, support, advocacy for others, etc. wherever you are. Leadership, in its true form, doesn’t need a business card.
Make sure your boss, and others in the food chain, are aware you would like to advance and at some time move into leadership. It’s important for them to know—the floors are littered with employees who were expecting someone to just “recognize their potential” and promote them extemporaneously. It happens, but don’t live your life expecting it. Take action and let someone know.
Now, to be promoted, I tell people to be mindful of the Three P’s for promotion… for you to be promoted:
Performance. Yours must be top-notch. Maybe not the best, but certainly well above satisfactory. You’ve got to demonstrate discretionary effort, above just doing your job.
Potential. You’ll need to demonstrate that you can do more. By doing more, by asking to do more, by accepting almost anything that comes your way, by requesting and embracing any learning opportunity, etc.
Position. You can knock #1 and #2 out of the park, but there still must be a position to promote to, or you cannot move. This is where your patience will be tested, and you simply must rise to the challenge. If someone is promoted “over” you, your performance, attitude, etc. cannot falter. Even if you were unjustly skipped. Keep the performance top-notch, and your behaviors positive.
You know, sometimes we look for specific events or publicized actions to identify a really special leader. We’ve even been guilty of that here in our Leaders & Laggards section. And that’s shortsighted.
How about, instead of the single, flashy, attention-getting PR piece, we showcase someone who has simply exemplified successful leadership over time. What a concept…!
Katia is a rock star. Not much in the way of prior experience, she co-founded Birchbox in 2010, completely disrupting the women’s cosmetics space; today, after celebrating their 6-year anniversary, the venture boasts revenue of around $200 million. It’s hard to say that’s anything but a rip-roaring success, even given some recent challenges. And when you read about her, you can’t help but like her. This 33-year old just seems to do the right thing, because it’s the right thing.
“Criticism is a learning moment and in many cases it is what you need to push you toward exponential growth in the moments when you need that. I would be lying if I didn’t say it’s hard to hear sometimes. It can be painful when you are working so hard and giving everything to your work, to ever let people down. But I have had to toughen up a lot over the years. I know, intellectually, that criticism is a form of caring for someone because it does give you that push.”
“I try to avoid providing answers, and encourage my team to do that instead.”
“I’m here to provide a reminder for why we’re here and what we’re doing, but I’m not here to always provide the answer.”
“You need to give your team the room they need to breathe.”
So, nothing singularly flashy this month; just an entrepreneurial leader who’s getting it done, and doing so with style and aplomb. Her 250 employees (including a brick-and-mortar store in SoHo) and well over a million subscribers would likely agree. Her proud moments are things that make us smile…
“My proudest moments are not the big wins, but the smaller things – like sitting in a meeting and seeing how smart and thoughtful my team is. We’ve evolved into something bigger than just me.”
Plus, she’s a native Texan and likes 1970 Ford Broncos. What’s not to like?
Thanks, Katia Beauchamp, for being this month’s Leadership Leader.
Leadership Milquetoast
Daimler AG (Ever wonder what the AG means? Aktiengesellschaft.)
Daimler AG almost got it right when they removed a senior executive from their Daimler Greater China late last month.
One could argue that they took fairly swift action against Rainer Gärtner, ex-President and CEO of Daimler Trucks and Busses (China) Ltd (DTBC), a mere 48-hours after he allegedly slandered not just a Chinese driver, but thewhole country – and pepper-sprayed the crowd – in a parking spot version of road rage.
Daimler apologized for Gärtner’s behavior the day after it happened but couldn’t withstand the onslaught of negative Chinese social media attacks, and removed him from his position the day after.
“We deeply regret the outcome of the personal dispute. The words and actions involved in this dispute as reported in the media do not represent at all the views of the company.”
And after a very short “investigation,” Daimler released this statement the next day:
“The nature of the dispute and in particular the manner in which it was conducted, irrespective of any comments alleged to have been made, is adjudged to be not only of concern to the public but viewed by us as detrimental to the standing of our company, unbecoming of a manager of our brand and prejudicial to our good name.”
Nice apology written by the PC public affairs bunch, but I don’t buy it. That’s called damage control, not leadership.
Okay, so they recognized that one of their senior executives was about to be persona non grata and hastily repatriated him, but they did it under withering fire.
And if a CEO of one of your major operating units thinks he’s entitled to act like an ass, maybe you need to change your vetting process. You see, you don’t choose to lead by example; you can only choose whether it will be a good example or a bad one. Gärtner chose poorly.
Regardless of what they say, a CEO’s behavior does reflect an organization’s culture, and that’s a leadership issue. Gärtner’s behavior, while boorish, had nothing to do with running DTBC. But leadership is less about what you’re doing than how you’re being. Gärter was being a jerk – don’t pretend he didn’t know what he was doing – and that reflects a senior leadership entitlement mentality in Daimler’s culture.
I also couldn’t help but notice that the media maelstrom ended with the announcement that Gartner had been “removed.” In fact, it’s as if Rainer Gärtner ceased to exist after Nov 22nd.
If Daimler was serious about demonstrating that Gärtner’s behavior was unacceptable, the company would have taken a different tack than out of sight out of mind for a CEO that pissed off a country that buys 22% of Daimler’s vehicles.
Bottom line for me: Gärtner acted like a jackass; he probably wouldn’t have gotten away with it in Texas. Daimler had an opportunity to show what their company really stood for and how they expected their senior leadership to reflect that culture. They blew it.Gärtner’s behavior probably deserved a Leadership Laggard award, but I thought it was better to reward Daimler’s namby-pamby response with this month’s award for a classic missed opportunity. Congratulations, Daimler, you’re December’s Leadership Milquetoast.
Leadership Laggard
Steve Huffman, Reddit CEO
Every now and then, some clown discovers himself atop an organization, and everyone wonders “why?” Hilarity (or calamity) ensues, usually ending with someone scratching their heads and asking, “what was he thinking??”
The poster child for that this month Is Reddit’s Steve Huffman.
(Caution: in one of the following paragraphs, I say “Donald Trump.” You’ve been warned.)
For troglodytes, Luddites and those over 50 (I’m certain I fit at least two of those), Reddit is essentially the offspring when an online newspaper mates with a bulletin board; content is both curated and sometimes created. People upvote or downvote your content, making it more or less visible to others. Sort of like a Facebook without the duck-lip selfies and cat videos.
Huffman was an original founder and creator, and the name “Reddit” is a play on words from “read it.” Anyway, it’s a fairly big deal with over 500 million visitors each month, and in the top 25 of website traffic in the world. Users fiercely advocate for the open nature and diverse community. Sort of a free speech test bed. The former CEO, Ellen Pao, was literally voted off the island for banning a few communities for fostering off-site harassment. Censorship is pretty much unheard of on Reddit.
Until now.
Huffman, apparently not a fan of Donald Trump, found himself the target of personal attacks from one of the more extreme Reddit communities, so instead of blocking or even deleting the community, he quickly made a stand… by taking the low road. He modified the contents of many public user comments on Reddit that he disliked. He literally went into the program and changed insulting comments made towards him and made it appear as if the insult were directed at the moderators of the “The Donald” Reddit community.
Needless to say, that didn’t end well. And to make things worse, Stevie wandered through several excuses: first, he said it was frustration with communities that try his patience. Next, he was “just joking” with those people, unsure why they “took it wrong.” Yeah, I call bullshit on that one. Finally, he said “well, that sort of thing shouldn’t be allowed on Reddit anyway.” Could be true (I don’t know, didn’t read them), but that only makes the case for deleting, not falsifying the content to favor yourself.
He restored the comments to their original form, but made it clear he didn’t feel he really did anything wrong, merely that he should’ve found another way to do it, with his “I abused my power to give the bullies a hard time.” Classic #sorrynotsorry.
I’ve got a better idea—why not figure out how to be a CEO, and take it from there.
But then, we’d have to find another Leadership Laggard for December.
