leadership incorporated blog

July 31, 2011

Do you know where you’re leading from in stressful situations?

 (458 words, less than 2 minutes read time)

An exec, high in ranks of a financial organization, was dealing with a CEO who was increasingly angry and demanding. The harder the exec tried to figure out how to please the CEO and gain his acceptance, the angrier and more demanding, and even abusive, the CEO became. With each new conflict, the exec always came at it asking the question: what do I have to do to get him to accept me?

It turns out, the CEO didn’t give a whit about the personal relationship. All he cared about were the business results. He was becoming more and more frustrated by this exec’s focus on the personal. The more the exec pressed for acceptance the less accepting and more demanding the CEO became.

Neither of these smart, talented, experienced professionals were wrong. Results are essential. So are good working relationships. What was going on is that each of them was approaching every problem from their own particular style and with a huge gaping blind spot to the style of other.

We all do this. We may think that we have many reasoned approaches to dealing with our business partners. But if we’re brutally honest with ourselves and take a  deep look, we’ll see that especially in the face of problems — real problems, the ones that stump us, the ones we don’t know how to solve, the ones that get under our skin — particularly in those moments, we each have our own habitual reaction that is our default. And it blinds us to other options and opportunities.

We might become angry and demanding. We might get very worried about the relationships and be unable to see anything else. We might focus on finding any solution that will stabilize the situation, anything to create peace now. We might focus on the details and facts, trying to prove our way out of the situation. We might go quiet and avoid the problem, hoping it will just go away. And so on.

The more stressful the situation, the more likely that we will approach it from that same room in our minds.

What room in your mind do you lead from when you are stuck in a business problem?

One of the ways I coach leaders and management teams is to make them  aware that they are only seeing the one room, while there’s a whole estate worth of other options available to them that can increase their effectiveness and their organization’s productivity.

The poet Hafiz said “Change rooms in your mind for a day.”

True leaders, when frustrated, change focus inside themselves before focusing outside themselves.
Become aware of your internal scenery. Find the door out of the room you’re stuck in and see what new solutions become possible.

July 10, 2011

Managing Growth: Why financial goals undermine financial results

I met this week with a leader in a digital media publishing company that is poised for growth. They have a powerful and connected new board driving them to grow the business. They have a strong platform to build on. They have a devoted following who believes in what they have done in the past.

I began, as I usually do, by asking, “What’s your Point B? What will successful growth look like for you?”

His answer was all about the financials.

I hear this a lot. We are measured by our financial success (both internally and externally) so we start to see the financials as our objectives.

This is an enormous trap that snaps the legs off many businesses. And here’s why:

Your financials are the results of organizational strategy and execution. As organizational goals, financials are generally not actionable. Other than putting money into passive financial investments, there are no direct actions we can take to achieve financial goals. And if goals aren’t actionable, they are nothing more than wishes. Very distracting wishes.

As many business leaders have learned the hard way, we cannot directly control our financial results. Sure, we can influence them — but we are ineffective when we put our focus on trying to control them. Setting financial goals is an attempt to control what we can’t control and results in tremendous squandering of focus, energy, time, good will and much more.

So, if we can’t control the financial results, what can we control?  We can create the conditions that will produce the results we want to see. This may seem at first like semantics, but we all frequently see leaders who by focusing on trying to create the money overlook the very strategies and actions that would otherwise lead to the money.

No matter what your mission statement says, setting financial objectives makes money the purpose of your organization. The primary goals and objectives of any organization inform its decision-making, interactions and everything else. When your primary objectives are financial, your people can’t help but make decisions that communicate to customers and prospective customers that money is what you care about. As your customers are an important player in your growth, the effort to focus on money as a goal actually undermines its own achievement.

Making the bottom line your main purpose in this way robs you of the opportunity to capture the hearts, minds and energy of your customers, your staff, your vendors, and the public. Focusing on the money keeps you from having a higher purpose that people can really get behind, talk about, and want to work hard for.

Growth is not a one-sided event that is all on your company to create. Growth is always a collaboration between an organization and its customers, staff, vendors and others. Focusing on the money, which is only of interest to one party in the collaboration, actually denies and sabotages the existence of that crucial partnership.

So, what do I coach my clients to do instead?

  1. Develop a clear picture of the purpose of your organization. What business are you in? What is the meaning of your products and/or services to your various audiences?
  2. Know your desired financial results. Revenues are a critical guide and measure of organizational health and progress, but should never be your primary objective. Even (as in the case of banks, investment companies, etc.) when growing money is your product and service!
  3. Set objectives that create the conditions for the financial results you want to see. Set objectives based on actions, behaviors, or things your organization can create that support both your organizational purpose and your desired financial results. Use the results as a measure rather than as the objectives themselves.

The most successful companies already know this: Focus on creating the conditions that lead to the results you want to see and the results will take care of themselves.

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