great PEOPLE DECISIONS Why They Matter So Much, Why They Are So Hard, and How You Can Master Them phần 9 ppsx

All of the relevantresearch shows that most managers actually spend most of their time re- lating to others; the question is, how well do they do it?7 Gabarro arguesthat the ability to d

than a sprint They have to maintain a balanced life, if they want to erate at maximum effectiveness and efficiency.

op-A third problem I have seen quite frequently is a mismatch betweenthe new manager’s style and that of the working team, particularly in thearea of control and delegation This is a combination of both sides’ expec-tation of what’s right and normal If the manager is (or is perceived to be)overly controlling, the team gets frustrated, and rebels by either resisting

or withdrawing In either case, the result is underperformance

A fourth typical trap arises when the new manager fails to invest indeveloping strong relations with key people This requires a 360° per-spective, extending to bosses, peers, and subordinates All of the relevantresearch shows that most managers actually spend most of their time re-

lating to others; the question is, how well do they do it?7 Gabarro arguesthat the ability to develop proper relationships with key people is thebest predictor of success or failure:

Perhaps the most salient difference between the successful and thefailed transitions was the quality of a new manager’s working rela-tionships at the end of his first year Three of four managers in thefailed successions had poor working relationships with two or more

of their key subordinates by the end of twelve months.8

Likewise, research from the Center for Creative Leadership cates that top-level executives define executive “success” according totwo measures:

indi-1. Bottom-line organizational results achieved during those viduals’ tenure

indi-2. The relationships they maintained with others, and in lar, their subordinates9

particu-Another frequent integration trap grows out of the legacy actions

of the predecessor This is particularly serious in the case of outgoing

CEOs, who may succumb to various types of temptation over the last fewyears of their tenure (especially if they have stayed on a little too long).These run the gamut from procrastinating on pressing problems to decid-ing to end their career with a “big bang” (e.g., a major acquisition ormerger), which may not be in the organization’s best interest over thelong run.10

Finally, a trap that very often manifests itself in the integrationphase is a lack of organizational support Because this sixth trap is such aserious problem, and because it arises so frequently, I’ll consider it atlength in the next section

Managing the Integration Process

In order to increase the chances of a new manager’s success, acceleratethe integration process, and maximize his or her contribution, companiesshould approach the integration proactively They should prepare for theintegration and follow it up Let’s look at each of these steps in turn

First, companies should be proactive In the case of the dairy company

referred to in previous chapters, a very visible search for a new CEO of thiscompany (actually the largest in its home country) led to the hiring of aforeigner who was literally on the other side of the world Within hours ofthe final contract being signed and the successful candidate resigning fromhis former CEO role, the board proactively staged a series of private andpublic announcements of the hiring The communications began at 6:00

P.M with a call to the country’s prime minister They continued the nextmorning with a videoconference hookup in the company’s boardroom, sothat the new CEO could meet his team, at least in a virtual sense, andhave an initial session with the local media Then came a series of individ-ual phone calls from the new CEO to each of his direct reports

In addition to skillful communication, being proactive means imizing preparation before taking charge Consider the case of a com-pany that hired a foreigner to be its CEO The newcomer experienced a

max-huge cultural shock in his new setting, and lasted only six weeks Thechairman of the board, understandably upset, and concluding that thesearch firm they had used up to that point didn’t adequately understandthe company’s culture, dumped that search firm and retained a new one.But the new search firm, sizing up the situation, concluded that itwasn’t simply a matter of paying more attention to culture: The companyand its internal politics were far more complex than first met the eye.The consultants informed the chairman that he personally needed tomake an extra effort to prepare the next CEO When the new personwas finally hired, both executives attended a “boot camp,” spending twodays on a university campus with the search firm and a carefully planned-out series of professors and advisors The process helped the two individ-uals confirm their priorities and mandates, discuss cultural and peopleissues, and get to know each other on a more personal basis.

The second thing companies should do is to properly prepare the

in-tegration A couple of years ago, a good friend and client—the president

and CEO of a very successful durable goods company, which I’ll call

“DuraGoods”—paid me a visit He represented the fourth generation ofhis family to run the business He told me that he was about to turn 50,and he had made the decision to retire from an executive role For thefirst time in a century, he confided, there were no family members whowere qualified to take over DuraGoods, nor were there other strong in-ternal candidates As a result, he had decided to conduct an externalsearch, in which he wanted our help

It was clear to me and my colleagues that for this family business tobring in an external CEO for the first time in its long history would be amajor challenge But we worked with the retiring CEO (and anotherboard member who was on the search committee) to plan and imple-ment a series of integration actions These included:

• Communicating to all key internal stakeholders, in a consistentand regular way, the reasons for the search, and ultimately fortheir choice

• Coming up with a very explicit mandate for the new CEO

• Spending time with the new CEO to review the company’s tory and culture in an intensive way

his-• Presenting the new CEO to relevant leaders and managers

• Reviewing with him successful examples of integration, lighting what had actually worked in other relevant contexts

high-• Setting up a plan to provide feedback “early and often” duringthe integration process

• Agreeing on a realistic timetable for objectives, including ing, building relationships, and scoring some “early wins”

learn-The right search, together with the right integration support, lowed for an extremely successful integration, which was followed by arecord performance, despite the newness of the manager

al-Particularly for very senior positions, the minimum preparation for

an integration should include:

• An explicit understanding of the governance, structure, and keyprocesses of the organization

• Key agreements about immediate priorities and action steps

• A shared understanding of long-term aspirations

• A clear plan to spend enough time together with the key holders, to help build trust-based relationships

stake-In the case of internal promotions to CEO positions, the boardshould insist on a longer and properly structured transition process, inwhich the heir apparent is given the chance to learn, prepare, and de-velop the right type of organizational network and support At the sametime, the board should continually monitor the outgoing CEO’s engage-ment with the business as he approaches retirement to ensure that there

is still a hand on the tiller, and that the retiring executive is not tempted

to make a counterproductive “last gasp” grand gesture

The third thing that companies can do to support the integration is

to follow it up closely Every few months, the organization should formally

analyze progress against expectations, by trying to answer at least four sic questions:

ba-1. Has the organization been providing the proper support to the hired candidate? Potential issues to consider include the clarity of

mandate, a proper briefing on the company’s history and ture, the right level of early feedback, as well as the availability

cul-of some clear internal sponsor

2. Is the new manager developing proper relationships in the tion? Networking, working closely with peers, understanding the

organiza-corporate culture, and securing the trust of her own team, boss,and peers all should be counted as signs of appropriate progress

3. Is the business model being properly worked by the new ager? This means, for example, understanding the fundamentalprocesses, products, services, and business requirements, andputting assets to work in appropriate (initial) ways

man-4. Is there evidence of progress? There’s no point in asking this

ques-tion too soon On the other hand, it’s fair to look for clear ments of priorities and milestones, and (at some point)evidence for progress toward those milestones

state-There’s one more thing that companies have to be prepared to doduring the integration phase, if and when it becomes clear that the inte-

gration simply isn’t working: Pull the plug This is never easy Significant

amounts of time and money have been spent in finding, recruiting, andintegrating the newcomer But sometimes it just doesn’t work, and the

parties involved have to have the courage to face that fact, and act,

un-comfortable as that may be

I remember being impressed by a colleague who had conducted asearch for a country manager for a consumer goods company in a majorstrategic market, far away from headquarters The best available candi-

date was signed up, and took over But there were danger signals almostimmediately The client and my colleague decided to assess the integra-tion after three months They met individually with the new manager,and also with some 20 insiders, trying to get a sense of where things wereheading The lights were definitely flashing yellow.

The new manager received in-depth feedback and mentoring ter another three months, a similar interview was conducted Both theclient and my colleague reluctantly concluded that the new countrymanager was not going to make it, and that it would be better for all con-cerned to acknowledge that A new search began, in a way that wouldnot unnecessarily embarrass the failed incumbent, and another candi-date who was previously unavailable was hired

Af-“Saving face” can be a trap and a sign of weakness You do no one afavor by keeping him or her in an untenable situation If the integrationcan’t work, have the strength of character to end it

From the Successful Candidate’s Perspective

When I was in the early stages of writing this book, I had a long meetingwith Jack Welch In the course of that discussion, I asked him about thebest way to integrate a new manager in a senior position, particularly if

he or she is coming in from a different business His response:

He’ll need to have a sponsor! I will advise no one to move when he

or she is not hired by someone with real authority, real clout, whowould support him, who would bet on him through thick and thin.This is the key It’s essential for success

I agree First: If you’re the successful candidate for a challenging

post, and there’s no “champion” in sight, don’t take the job.

The second thing that candidates should keep in mind is that thework is almost certain to be harder than expected We asked the CEOs ofbiotechs how they would spend their first 100 days differently, if they had

it to do again Their answers are summarized in Figure 9.3 Most thought

that they should have done more of just about everything Acting and

learning at the same time is almost always a tough challenge!

The third thing that hired candidates should keep is mind is thatthey can and should demand the kinds of organizational support outlined

in the previous section Most companies provide only minimal tion support It’s not because they’re cheap or malevolent, but simply be-cause they don’t know any better Asking for this support and helpingthe company plan for it can make a big difference

integra-Fourth, new hires should start by focusing on a few key areas,rather than being pulled in every direction at once A recent study byMcKinsey & Co., written as a guide for the CEO-elect, highlightedthree essential areas:

1. Understanding the organization and its other leaders more fully

2. Diagnosing and addressing their own weaknesses

3. Identifying resources that can smooth the transition, includingthe right advisors11

"In the first 100 days, my focus on …

13 3

15 1

10 0

11 1

8 3

10 1

should have been lower

…should have been higher”:

(a) … understanding the market …

(b) … understanding the organization …

…

(c) understanding the abilities of the company

(d) … meeting key people of the company …

(e) … meeting key customers …

(f ) … communication to shareholders …

(g) … meeting key stakeholders outside the company …

(h) … broad communication into company …

(I) … reshaping the strategy…

(j) … rearranging my team

…

“:

FIGURE 9.3 Attention in the First 100 Days—Revisited

Source: Biotech CEO Survey 2005: The First 100 Days, Egon Zehnder International.

© Egon Zehnder International.

Yes, life at the top can be lonely, but you can work against that come A key strategy for success is to find the right type of personal advi-sor, which more than 80 percent of the managers we studied in thefinancial sector cited as one of their key strategies The most frequent ad-visor in that sample set was a colleague from the executive committee,followed by the company’s president (mainly among external candidates)

out-as well out-as external sources, including a variety of consultants (to gain sights either about the sector or about the integration process itself).12Eventually, the new manager must also make the critical decisionabout which expectations to honor and which to abandon.13The expec-tations defined at the outset are very likely to include conflicting, oreven impossible, goals This problem may be aggravated by the implicit

in-or explicit promises that have been made by predecessin-ors Expansionplans, job security, promotion prospects, career trajectories, compensa-tion expectations, and working conditions—all are grounds for expecta-tions, which may or may not be met (or even “meetable”) The newleader has to surface and deal with these expectations, which otherwisemay translate into “broken promises.”

Meanwhile, of course, the new manager has to confirm his or herteam The initial months are a very difficult period, because the newmanager has to judge the competence and attitude of team memberswhile still working with them Each side is sizing up the other, wondering

if the other will “make the cut.” At the same time, someone has to bemaking and shipping the widgets

When we asked the financial institutions’ CEOs what they shouldhave done differently during their first three months in charge, the most

common response was they should have paid more attention to analyzing and managing the company’s senior leaders The biotech CEOs said that

they should have developed a better understanding of the abilities of thecompany, and spent more time diagnosing and redeploying their teammembers

Finally, from Day One all the way through Year Three and beyond,the new manager has to make a special effort to seek out and spend

personal time with representatives of all relevant stakeholders If I had tomake just one recommendation, based on my experience, this would be

it There is no substitute for your personal presence, and personal touch

The Human Element

The power of “personal touch” can’t be overemphasized Stated tively, the failure to develop strong personal relationships with key play-ers is the most telling indicator of integration failure Stated positively, ifyou can find allies who will go to the wall for you, you can compensatefor almost any other shortcoming

nega-Developing relationships with key people is essential for manyreasons First, as noted, allies (in the form of experienced organiza-tional insiders) can help the new manager succeed They can help ac-celerate the learning process, shortening the diagnostic periodwithout sacrificing its quality And good relationships are the basis

of trust, which in turn is a critical underpinning of leadership and

in-as well in-as the minimum level of formal authority, your ability to cultivatetrust will depend critically on the amount of quality personal time thatyou spend eyeball to eyeball with your boss, your key team members, andother relevant peers and stakeholders

This commonsense observation has recently been confirmed by coveries in the field of neuroscience, focusing on brain cells called “mir-ror neurons.” These cells apparently help us sense the movementsanother person is about to make, and prepare us (on an unconscious

dis-level) to imitate that movement Simply stated, we are prepared to smilethe instant the other person smiles An emerging notion in the philoso-phy of mind, moreover, argues that we understand others not by observ-ing them and thinking about them, but by “translating their actions intothe neural language that prepares us for the same actions and lets us ex-perience alike.”14 I’ll take the liberty of putting these two ideas in thesame sentence: When we spend time with others, we experience themthrough the work of our mirror neurons, and by experiencing them, weunderstand them and bond with them.

Face time—eyeball to eyeball—is important The development ofbonding relationships is bound up with the eyes, which contain nerveprojections that lead directly to a key brain structure for empathy andmatching emotions.15When we are interacting with a person, that struc-ture—again, accessed through the eyes—reminds us whether we love orloathe that person.16

There’s simply no substitute for one-on-one sessions If you could

do only one thing in service to integration, this would be it

How to Beat the Odds

A couple of weeks ago, I received a research brief from the McKinsey

Quar-terly on the subject of who should and shouldn’t run the family business.17The report showed that family-owned companies run by outsidersappear to be better managed than other companies, while family-ownedcompanies run by eldest sons tend to be managed relatively poorly Thislast correlation seemed particularly strong The authors asserted thatfamily-owned companies run by eldest sons accounted for 43 percent ofthe gap in managerial quality they identified between companies inFrance (where almost half of family companies are run by the eldest son

as CEO) and those in the United States

When I read that article, however, I was reminded of a case

that I witnessed that clearly overcame those odds Several years ago, Ireceived a phone call from a client He was the executive chairman of

a very successful company that had been founded at the beginning ofthe previous century, in which he represented the third generation offamily leadership

The man, then in his seventies, asked me for an urgent meeting

to discuss an important issue I replied to him that I was about to take

a plane from Buenos Aires to New York within just a few hours, butthat I would be more than happy to meet with him upon my return intwo days

He had always struck me as a very calm and patient individual Iwas therefore extremely surprised when he asked me if I could stop by hishouse on the way to the airport He really needed me to spend at least

half an hour with him, now, he said, because the matter was so important

and time sensitive

Perplexed, I went to his house in La Isla, one of the nicest borhoods in town I was greeted first by his wife, who served us tea andpromptly vanished, leaving us alone I sensed that something specialwas up

neigh-“I will get straight to the point,” he began neigh-“I have a bad cancer,and my days are numbered I want to ask you whether you think that myeldest son would be the best CEO for our company I have asked you tocome here because I want to look into your eyes when you answer thatquestion I don’t want an answer out of compassion I want the best for

my company and my family, long after I’m gone So I beg you to give meyour most professional and honest answer.”

I don’t think my eyes left his more than once or twice during thewhole hour we spent together I wanted him to know that I was being ashonest as I possibly could be, in that critical circumstance Luckily, thesituation was made easier for me because I genuinely believed that theson was probably the best potential candidate to run that company Ex-tremely competent, hardworking, and responsible, he had an impeccable

education and all his career had prepared him for that challenge He was

in his early forties He would have the advantage of knowing the pany, the business, and the relevant people, and of course would be thefourth generation to run the business

com-I told the father this, in so many words And yet, he spent at leasthalf an hour probing me, quizzing me about potential external candidateswhom I could identify off the top of my head given my experience in theArgentine market, asking about his son’s shortcomings, and grilling me

on the pros and cons of external solutions

Even after he finally became convinced about my own conviction,

he still wouldn’t let me go We spent another half hour planning variousintegration issues at increasing levels of detail

Finally, he also wanted my candid advice on the compensationlevel and structure for his son in the new CEO role He wanted to be fairboth to him and to the company, and he didn’t want to create any prob-lems with the rest of the shareholders and family members, several ofwhom were brothers and cousins of the would-be CEO

His son did indeed become the CEO of the company, and shortlyafter that, the father died The company turned in an outstanding perfor-mance in terms of growth, profitability, and diversification by product,service, and geography

After almost a decade of service as the CEO, the son came tovisit me at my office He explained that he felt that the time wascoming for him to retire from his executive responsibilities Althoughstill a young man (about to turn 50), he was convinced that leadersshould step down after a decade or so Companies need new blood, hetold me

But there was more Remember “DuraGoods,” the successfuldurable goods company I referred to earlier, where the soon-to-retireCEO of a family business decided that it was time to step down, andthat there were no qualified successors within the family? That CEOwas actually the son of this brave father We worked with him to hire

an outsider, with whom we worked closely to plan and implement asuccessful integration process.

Why do I close this chapter with this story? Because unlike mostcompanies in the McKinsey study, this family-owned company man-aged to achieve the best of both worlds They maintained their long-term strategic perspective, but gave up the pressures of deliveringquarterly results to investors, and hitting short-term earnings targets

Integration of a new manager is a critical step

• The process is long and risky

• Most organizations don’t provide the right type of support

Several traps can sabotage this process, including

• Minimizing the challenges of acting and learning

• Becoming kidnapped by stress

• Mismatches of management styles

• Underinvesting in the development of strong relations with key people

• Legacy actions of the predecessor

• Wrong hiring decisions

• Lack of proper organizational support

Companies can do several things to support integration

• Being proactive at internal communication and candidate preparation

• Properly preparing the ground within the organization

• Closely following up the process at regular intervals, monitoring the level of organizational support, relationship building, working of the business model, and setting the stage for early wins

Candidates should also take charge of their successful integration

• Ensuring the right sponsor

• Realizing that the integration work is harder than expected

• Asking up front for the type of organizational support required

• Focusing on a few key areas

• Properly managing expectations

• Confirming the new team

• Spending enough personal time with all relevant stakeholders

FIGURE 9.4 How to Integrate the Best People

Meanwhile, they played an active role in finding and mentoring thebest possible leaders for the company, whether a son, or an unknownoutsider.

In my view, both father and son displayed an amazing level of awareness and anticipation: the former in confronting his death, and thelatter in acknowledging the need to pass the baton while still in peakform Neither procrastinated Both precipitated the change that wasneeded Both insisted on the strongest possible integration, although thetwo integration processes were dramatically different

self-Both generations demonstrated as well a remarkable level of pline and objectivity in assessing candidates—even when father assessedson Both showed courage and compassion

disci-In my estimation, that’s how they beat the odds cited in theMcKinsey study And the lessons are more broadly applicable, I think Ifyou want to aim at great performance, and if you want to make greatpeople decisions surely and consistently, do what this family did: Be self-aware, look down the road, be disciplined, and be courageous

Figure 9.4 summarizes the key points covered in this chapter

■ ■ ■

Following the practices described in this chapter, you will be able to cessfully integrate the best candidate

suc-In our final chapter, I explain why mastering great people decisions

is important on a larger scale

CHAPTER TEN

The Bigger Picture

As I write this final chapter, I have in front of me a recent issue of The

Economist, which features a 15-page cover article called “The Search

for Talent (Why It’s Getting Harder to Find).”1 The report makes thecentral point that today’s economy places an enormous premium on tal-ent, and that there isn’t enough of that commodity to go around It un-derscores the critical importance of “intangible” assets, which haveballooned from something like 20 percent of the value of the typicalS&P 500 company in 1980 to something like 70 percent today Finally, itpoints to the various structural factors behind this challenge, includingdemographics, the collapse of loyalty (both to and from the employer),and various forms of skills mismatches

But because you’ve read this far in Great People Decisions, none of this surprises you In fact, The Economist’s report only confirms that mak-

ing great people decisions represents a major challenge, as well as aunique opportunity, for those able to master them And because you’veread this far, you are probably convinced that mastering great people de-cisions not only can help drive organizational performance, but also canenhance your chances of personal career success

Now it’s time to adopt a bigger frame In this final chapter, I explain

why making great people decisions is important on a much larger scale.

279

Every Day, All the Time

Because you’ve internalized the lessons of Great People Decisions up to

this point, you have the skills you need to hire someone for your team,promote a team member, and participate in other key people decisions in

your organization But there’s more: You also possess a set of tools,

processes, and concepts that should be invaluable in your leadership role every day, all the time Why is this so? There are several answers The first is

that the lessons in the previous chapters apply not only to major people

decisions, but also to every single delegation decision.

In every day of your life as a leader, when you’re deciding who’s ing to do what, you can follow the principles outlined in this book Isthere anything you are planning to do that you could delegate to someoneelse? If so, what should you be looking for, in terms of competencies?Where will you look for the right person to perform that task—whether

go-on your team, within the larger organizatigo-on, or perhaps even outside,through some form of outsourcing? How are you going to motivate him orher to do the job? How will you facilitate his or her initial actions? Howwill you monitor or assess his or her performance over the longer term?Just like great hiring and promotion, delegating more often andmore effectively improves your organization’s results, and helps ensureyour own career success By being a better delegator, moreover, you buildthe larger organization by helping others grow For knowledge workers,the best way to develop is not through traditional training, but ratherthrough on-the-job experience in appropriate, increasingly challenging

settings Great delegation decisions are therefore a win-win solution, both

for you and your people

How about Yourself?

For most of the preceding pages, we’ve looked at principles and practicesfrom the employer’s point of view Well, the other great thing about