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A Human Business Primer: Overcoming Trump’s Fear-Driven Capitalism, Part 1



Photo sources: “Joy“: https://flic.kr/p/7usYCr. “Fear“: http://tinyurl.com/y8gtw3wj.

Photo sources: “Joy“: https://flic.kr/p/7usYCr. “Fear“: http://tinyurl.com/y8gtw3wj.

This is not another attack on Trump.  Actually, I don’t really care too much about Trump.  What I do care about are the implications of his policies, ideology, worldview, decisions, moods, and, believe it or not, at times his tweets.  And yet, it is not about Trump as a person.  Last week, former President Obama rightly stated that Trump is not the cause but a symptom for a lot of things that have gone array these days in business, society and the world.  And, indeed, Trump is a strong symptom, an excellent and exemplary figure to represent capitalism of the old ages.  The problem is, we no longer we live in the 19thor 20thcentury that were heavily shaped by traditional capitalism Trump loves so much.

Traditional capitalism at its “best”

Traditional capitalism rewards those who seek short-term gains, maximize profits regardless of whether or not business generates value to customers, workforce, business or society.  This capitalism treats humans and the environment as resources, cost factors and numbers in balance sheets.  It thrives in an atmosphere of mistrust, tension, fierce cutthroat and winner-takes-all competition, selfishness and anxiety.  Exploiting or polluting the environment is considered collateral damage and, hence, not evil.  The dividing and widening gap between rich and poor is dismissed as a distraction that can be fixed – by the free market. While proponents of traditional capitalism don’t negate the fact the world is becoming ever more volatile, uncertain, complex and ambiguous they are not really concerned about it because they believe that the established business principles, processes and rules can handle these challenges, too.  And, if there were a problem it is probably because some people, organizations or governments neglected these established principles.

Capitalism is not dead. It is outdated in its traditional form

I am not a critic of capitalism per se (how could I, having been trained as an economist?). Fact is that traditional capitalism leads to a dead-end, does not answer today’s challenges in a VUCA (volatile, uncertain, complex, ambiguous) world, widens the gap between rich and poor, exploits and threatens to destroy our environment and thus our own planet. This is not a call to end capitalism – this would this too simplistic.  And it would be plain stupid for capitalism is a core element of business which we, people, need to survive and thrive.  What we need is a different, a new business paradigm that not only helps find solutions to today’s problems but can also serve as guidance to sustainable business in the 21stcentury.

The Human Business Paradigm

The good news is such business principles already exist. They constitute the Human Business Paradigm.  These principles can serve as a new compass for doing business in the 21stcentury.  Let me summarize its key principles:

The Human Business Paradigm
1. Human business is holistic and human-centered, i.e., it focuses on serving and delighting its customers, workforce, business, and society.

2. The purpose of human business is to generate and add sustainable value to its customers, workforce, business, and society.

3. Human business promotes diversity in the workforce, reflecting an open society.

4. Human business advocates cross-functional and self-organizing teams.

5. Human business nourishes joy and happiness in its daily operation.

6. Human business practices and nurtures conscious leadership of enablement and empowerment.

7. Human business cultivates open and learning organizations that embrace change and thrive for continuous self-improvement of products and services, processes and people.

8. Human business provides and shares guidance for responding to rapid change in business and society.

9. Human business understands profits as a means to fulfill its business purposes; i.e., human business is purpose-driven and not profit-driven.

10. Human business advocates a circular economy, in which we keep resources in use for as long as possible, extract the maximum value from them whilst in use, then recover and regenerate products and materials at the end of each service life.

Walking the Talk. Building a Human Economy

During the next couple of weeks I plan to dwell into each of these principles and share concrete stories of companies, organizations and projects that practice these principles.  At Motivate2B and The Art of New Business we walk the talk; and there are many other businesses that do so already.   I invite you, too, to join us and share your stories.

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Posted in: Agile, Creative Economy, Future of Work, Human, Human Business

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Planning is Fear. Instead, Work with Life and Joy.


I have worked in professional project management for quite a number of years. Over the last years, I have moved away from classical project management and one of its core activities: planning. There are a number of reasons for this. First of all, I believe that classical planning is rooted in fear for volatility, uncertainty, complexity and ambiguity. Or, planning is afraid of reality and life where volatility, uncertainty, complexity and ambiguity are central elements.  Hence, classical planning is misguided and consequently often a waste of time and energy. Let me explain.

The myopia of classical planning

Foto © by A. Dreher | Pixelio.de

Photo © by A. Dreher | Pixelio.de

In classical project management we are expected to have a solid, validated project plan that lists major milestones, work packages and activities. Ideally, all work packages are linked with each other so that it becomes possible to predict the final delivery date of the project.
I have drafted numerous such project plans. And actually I enjoyed it for the most part. It gave me a sense of control and security. And the final plans looked great on paper. Alas, there were and are some major flaws with this: A plan is first of all a piece of paper. That’s it. No more, no less. Yes, of course, it can denote the important phases of a project and create the false impression that everything is under control. People tend to believe that a plan gives them security and certainty, reduces risks, prevents surprises and much more. Unfortunately, this is misguided and distracting from reality. Fact is that most project plans change the minute you “finish” them. President Eisenhower once said that a plan is worth nothing, planning is key. Well, I agree to some extent and add that planning is worth nothing if you don’t understand what’s behind it. I call it agile ‘planning’.

What’s behind agile ‘planning’?

If you start planning because you want to overcome volatility, uncertainty, complexity, and ambiguity, STOP right there. Planning will not help you achieve this. Volatility, uncertainty, complexity, and ambiguity (VUCA) have nothing to do with planning. They are rooted in reality whereas planning is just a tool.

If you want to get a grasp on volatility, uncertainty, complexity, and ambiguity understand their nature, what causes them. And find out why they bother you in the first place. Given that they are core elements and characteristics of reality you may as well ask yourself what bothers you about reality. In other words, find out what bothers you, period. What’s your problem? Or, if you like to phrase it more positively, what motivates you?

Contrast this to your vision of an ideal situation and see the gap between the problem (or motivation) and your vision. If this gap really bothers you, causes some form of pain, think about concrete steps how to get from point A to point B. This is what you could call agile ‘planning’. It is different from classical planning as it addresses the groundwork or foundation of our activities.
Planning without acknowledging and accepting your motivation and vision is just a shallow distraction from reality and a futile activity as it ignores reality, your reality.

Agile ‘planning’ can be joy

Photo © by Jörg Kleinschmidt | pixelio.de

An agile approach to ‘planning’ does not erase volatility, uncertainty, complexity, and ambiguity. This is not its purpose. It accepts them as a matter of fact. And it embraces them and explores ways and means to work with them to get closer to your vision or at least your interim goals. This is the opposite of fear. It is working and playing with joy. Doing so introduces lightness, creativity and inspiration to your “planning”. It sparks life into your planning process.  You don’t generate a product or service in one bug shot but you develop and deliver it in small, iterative increments. Just as you don’t reach your vision in one big step but in several smaller steps, one at a time.
Contrast this with classical planning that is guided by fear and the urge for control and certainty. Life and reality are not static, lifeless machines that can be easily replicated. Life is ever changing, complex, uncertain, and ambiguous. Corollary, agile ‘planning’ ought to reflect life. It can become a game, a dance, an art and thus an element of the art of new business.

Posted in: Agile, Centeredness, Creative Economy, Human, Sustainability, Tools

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3 dangerous pitfalls that keep conscious business leaders away from grasping the future of work in today’s digital age

Welcome to the future of work

Many of us know that today’s business world is changing. This is not new. It has always been this way. Alas, it is also a fact that due to digital change the pace of change in our business world, economy and even society as a whole has picked up tremendously. 5 years ago nobody talked about Tesla or Uber. Today not only lots of people heard about them and actually use their products and services, these products and services change the interactions and dynamics of business altogether. There may be some glitches, backlashes and opposition to new products and services as it has always been. But, this change, this uncertainty is here to stay. Who knows if, for example, Volkswagen will still be around in five to ten years? Remember companies such as Kodak, Blockbuster or Nokia who were so stable and strong?

Welcome to the VUCA world

We live in a volatile, uncertain, complex and ambiguous world – the so-called VUCA world – and this drives business leaders nuts. Gone are the days of certainty, control, plan and doing business as usual. The compass and direction of the established philosophy that businesses run like well-oiled engines are gone. What stays behind are questions, concerns, fears – and the understanding that businesses have to change if they want to survive and thrive in today’s Digital Age. But, what does it take? – There is no simple answer. However, what we can do is to identify the pitfalls, the backlashes, the viscious circles that keep us stuck in inertia. Here is a list of the top 3 pitfalls that keep conscious business leaders away from grasping the future of work in today’s digital age:

Pitfall #3: Fear of uncertainty

We may understand the need and value of change but we don’t like it and, even more, we hate uncertainty. We overcome this fear of change and uncertainty by planning and controlling processes. By securing a status quo. By the urge for perfection. Oh, yes we may actually embrace change but only as long as we can come up with quick fixes that yield immediate results.

What’s so bad about it? – Change, the New, innovation – they all have one characteristic in common: they are uncertain at the present moment. How can we learn new things if we don’t try them out?! Yes, there is always a likelihood that we fail, that we make mistakes. This is the prerequisite for learning. Or have you ever seen a child who just stands up and walks without first having falling hundreds of times?!

Pitfall #2: It’s about me. I have to defend my realm and power.

We see the value of teamwork – as long as it doesn’t undermine our own sphere of influence and power. Teamwork is great if it serves our own political agenda, goals, aspirations. Or, we empower our subordinates to work in teams. But at the end of the day it is us who have to made decisions. After all, it is us who hold responsibility and accountability. And those at the top, they are there for a good reason and, by the way, organizational hierarchies have proven helpful for decades.

What’s so bad about it? – It is not about an individual somewhere in an organization but a whole business which consists of many parts interacting with each other. Hierarchies may be helpful for administrative purposes but rarely do they promote collaboration across functional fields. High performing teams share a common motivation, vision, goals and values. It is not about levels in hierarchies, it is about a team performing as a unit. Or have you ever seen a soccer team with 11 goals keepers or 11 strikers? The mixture of roles and moving in unison make all the difference.

Pitfall #1: Business is always #1.

Let’s face it, whatever new ideas or approaches fly around, the bottom line is profits and pleasing shareholder interests because, remember, shareholders give us the money. This is why we have to deliver quarterly results that are convincing and look good and we do whatever it takes to achieve this. Everything else comes second or third.

What’s so bad about it? – A business without customers and without a workforce doesn’t exist. It is not a question of what comes first, ‘chicken or egg!’. The purpose of a firm is to create value for the customer. And for this you need a functioning workforce. However, people are not resources or machines but human beings and want to be treated as such. Furthermore, giving them and sharing a motivation and vision of your business will carry your business a long way.

A journey to the future

I doubt it that these pitfalls are new to you. You have either experienced them by yourself, observed in organizations and companies, have read or heard about them. On the other side, you have probably heard of companies that have already arrived in the Digital Age, that don’t talk about or plan the future of work but practice it. There are numerous companies out there and the numbers are growing. The question is if you want to be among them or left behind. And, if you do want to follow suit, what do you want to invest and what are your immediate next steps?

If you are interested, Motivate2B accompanies you on this journey. May it be in workshops, seminars, coaching, consulting or business partnerships. Contact us to find out more.

Posted in: Creative Economy, Future of Work, Leadership

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A dream coming true – the ideal company


Doing what I love, loving what I do. No more, no less. An international organization and environment where people are open for the unique and unprecedented opportunities of the digital transformation, also known as the Industrial Revolution 4.0. It is a place where you can explore, discover and share new practices of business, leadership and client relationships. A work-life balance doesn’t exist only on paper but is lived, day in day out. Simply because people love what they do and do what they love. It is a balance between work and life; not in the sense that work is bad and life is good, but because both are positive and inspiring.

My own role is right in the middle of this environment. Helping people and organizations unfold their potential, growing ideas into concrete business results that delight customers, contributing to a happy workplace, and ensuring and sustaining business value through continuous self-improvement. It is role that mixes practices of empowerment, facilitating, training, consulting, managing, learning and sharing.

So, where, you might ask, is this place, this work? – As mentioned above, this is my dream, this is my vision, this is what I am driving for. It could be an existing company already practicing mindful leadership and nurturing a healthy, lively and agile community. Or it could be an organization or company that is realizing that traditional management practices of the 20th century no longer provides the answers to today’s challenges and therefore open up for modern human, holistic and mindful approaches to leadership and business in the Creative Economy. Those are organizations and companies that are or will become the masters of the digital transformation. Those are the employers of choice because they make a difference, serve the community and leave a positive dent in the universe. This is the place where I want to be and contribute to.

Illusion, phantasy? Or, can you pinpoint or recommend any organizations that are on the path described above and are looking for support? If so, please share.

Posted in: Creative Economy, Empowerment

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Product vs. Customer Focus


If you ever had doubts about the essence and value of customer vs. product focus, have a look at the following example:
VW vs. BMW Perspectives

Now, imagine if Volkswagen changed its attitude and strategy and start focusing on and addressing the needs and expectations of their customers.  Personally, I believe it could help manage their present crisis, learn from it and come out of it stronger.  But, then, it’s a matter of perspective, attitude and mindset.

P.S.: What am I driving? A Skoda (Volkswagen) and so far I have been satisfied with my Volkswagen product.  Last week I received a letter from Volkswagen informing me that the software of my car needs to be modified.

Posted in: Creative Economy, innovation

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In Search for the Ideal Company


Over the last two decades I have worked for a number of companies, consulted even more. Some of them were outstanding, others were, well, less so. It is time to reflect and share what I believe are

3 characteristics of a well-run business and desired place to work and be

hand_thumbs_up_cuff_15176(1) Client delight

  • You don’t just satisfy, you delight your customers. You listen, understand and address their needs. It is a relationship, a dialogue. Not too surprising your customers not only come back to you but refer and recommend your company and its products and services to family and friends.
  • The products and services you provide are of high quality. Period. And it doesn’t end with the delivery of a product; it continues with an outstanding customer service. Want an example? Try Tesla Motors.
  • High quality of development of products and/or services. Whether you follow traditional best practices or practice lean and agile production methodologies and frameworks, the development of your product and/or services is committed to quality from the beginning to end, without compromises. This is faster, cheaper, safer and more rewarding to everyone involved.
  • You have an ear to the market and you deliver fast.
  • Your employees are committed to delight your customers because they know your and their customers. They understand and live quality and support company goals because they are shaping them, too.

group_jumping_up_400_clr_12574(2) A happy workplace

  • Your employees are not human resources, they are people and you treat them as such. Consequently, there is no “Human Resources” department; you call it “People Services” or “People Centre”. It not just a term, it is a philosophy and practice.
  • Your employees are inspired, motivated and performing, they enjoy their work because they can identify with the purpose of the company, love working with their colleagues and serving their customers, are passionate about their work and enjoy a safe, secure workplace.
  • The workforce is one big functioning organism. There is no place for static organizational hierarchies and distance between management and “the rest”. The communication style is open, transparent and conversational (vs. top-down and hierarchical).
  • You have and support autonomous teams with clear visions, objectives, roles & responsibilities.
  • Corporate leadership doesn’t cling to external “power and authority” but actively build future leaders and empowers their workforce.
  • Your company is the place to work. Not too surprisingly, turnover and sick days are low, very low.

Growth curve(3) Business value

  • You understand that short-term profits (EBIT) are the means and not the purpose of organizational performance. Instead you focus on long-term business performance parameters such Returns on Assets (ROA).
  • Your company has a positive business outlook. This is reflected in a positive, expected revenue stream, forecasted ROA, outstanding quality of the development of your products and/or services and, last but not least, a happy workplace (see above).
  • You continuously strive to become better, better and better. Innovation spans products, services, processes and your own people.
  • Innovation is not limited to a closed and exclusive „innovation department“. Innovation is open and everyone in the company is involved and participates. You encourage and empower your people to think outside the box. You don’t punish mistakes and failures but take them as learning opportunities. Hence, you recognize people’s ideas and celebrate successes together.

Excite! – Build your own ideal company

neutral Leadership Cycle of Organizational ExcellenceOver the last 18 months I have developed a comprehensive toolkit to evaluate and unfold the organizational potential and performance. It is simple, practical and applicable for short-, mid- and long-term organizational needs. It helps deliver measurable business results for client delight, a happy workplace, and business value. It does not create administrative effort without any sustainable value. As a matter of fact it fosters self-organizing, scalable best-practice sharing.

I call this toolkit and approach “Excite!” because unfolding organizational potential can and is exciting indeed. But, and this is a big “but”, it requires an open mind and common intent to unfold organizational potential and performance.   Not every company has this mindset. But then, not every company is the ideal company, the best place to work and be. It is a matter of choice.

Have I always worked for an ideal company? Well, no, not always; but, yes, I have worked for companies and teams that followed the principles outlined above (one of them was (during my times there) Cambridge Technology Partners and Vail Resorts). And if a company I work for is not ideal I always have a choice: I leave the company or help unfold its potential and performance. The latter is what motivates me.

Posted in: Centeredness, Creative Economy, Happiness, innovation, Leadership, Tools, WOW projects

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How to achieve organizational excellence: Appreciate your performance to unfold your potential

“Kumbaya” – or practicing traditional organizational development

About a year ago I told a friend of mine that my new project was in organizational development. He congratulated me and then asked, “so you are sitting in a circle around a bonfire and sing Kumbaya?” and smiled. He continued to explain that organizational development (OD) is often considered a theoretical, abstract, academic and sometimes even esoteric activity with no immediate, tangible or sustainable results. Nothing people and even less organizations can relate to. He claimed that that traditional OD often focused too much on processes and procedures. It didn’t adequately address the potential of people innovation in addition to product and process innovation. Furthermore, traditional OD activities often added administrative effort absorbing already scarce resources – without generating value for clients, people in the organization or the business. – Wow, that was a statement! And it kept me thinking for awhile. What if he was right?! What was I up against?!

The futility of organizational development

Today, a year later, I admit that my friend was (for the most part) right. What do you need organizational development for in a company that has been successfully in business for several years? To me it seems arrogant and ignorant approaching a business stating that you will help it develop its organization. I mean, what has this company been doing the last couple of years?

And yet, just because a company has been successfully been in business it doesn’t mean that it cannot improve its organizational performance and excel to the next level (see my previous post on organizational excellence here). The question is how to get there.

You are great already!

In my experience it is best to invite a company to first appreciate its existing performance. Where does it perform, how and why? What makes it so special? By focusing on the positive, on past accomplishments and present performance you create an environment that invites people to think of additional ways and means to improve their performance, taking it to the next level. The cool thing is that it is not rocket science. Just the opposite! All you need to do is find people who can talk about their experience and are willing to share stories. And this shouldn’t be too difficult! Putting this into the context of organizational excellence, the following questions serve as a guideline:

  • What is your understanding of client delight, a happy workplace, business value and continuous self-improvement? What story can you or do you want people to tell about your group / division with respect to client delight, a happy workplace, business value and continuous self-improvement?
  • What are the critical success factors for client delight, a happy workplace, business value and continuous self-improvement?
  • How do you secure client delight, a happy workplace, business value and continuous self-improvement ? E.g., through what products (portfolio, innovation, customer, etc.), people (individuals, leadership development, org. structure, etc.) or processes (strategies, policies, tools, etc.)?
  • How do you measure client delight, a happy workplace, business value and continuous self-improvement?
  • What do you invest to achieve client delight, a happy workplace, business value and continuous self-improvement?
  • What benefits do you get or expect from investing in client delight, a happy workplace, business value and continuous self-improvement?
  • What do you value most? Client delight, a happy workplace, business value or continuous self-improvement?

I have posed these questions in both workshop settings as well as online questionnaires. Workshop settings are more productive because they are more interactive and you get feedback immediately and this in return can generate new input, ideas and inspiration.

Appreciating your performance is setting the stage for continuous improvement

What I have found out is that once you have a group of people talk about their past accomplishments and present performance people can easily point out areas they want (or need) to improve. Hence, in a second question round, using the same questions as before, I am asking the group what they would like to improve and what possibly holds them back from doing so.

The third step is to plan concrete activities to overcome the impediments, draft a plan for any improvement activities, prioritize them (this is one reason why we asked the question, “What do you value most?”), identify owners and agree on an action plan and schedule.

Note that this process is not pre-determined or defined top-down. It comes from the people present. They identify their areas of improvements. And it is set in the context of past and present performance which fills them with pride and a sense of accomplishments. These are ingredients for motivation and the drive to excel.

The role of mindful leadership in unfolding organizational potential

What is my role in this process? I am not creating or defining activities for organizational improvements. The people do this by themselves. All I do is to facilitate. I help set the stage, invite people to this workshop or exchange of stories and kick off the dialogue and then let go. My role is more that of a conductor, you can say. But once the orchestra starts playing and has built momentum I step back, offer help only if needed or asked for. This is what help for unfolding organizational potential is all about. It is not an active, pushy part. It is an act of generative listening. Sounds simple; and it actually is.

Generative listening helps unfold organizational potential

And yet, listening, from all leadership capacities, probably is the one that’s most underrated. Everyone talks about vision, project objectives, project management technical skills, etc. But listening is really at the source of all great leadership. Listening ensures that leaders connect with the situation at hand. Any lack of listening skills therefore leads to a disconnection between leaders on the on the one hand and reality on the other. This can be fatal in a project setting that aims to improve the performance of an organization.

MIT senior lecturer Otto Scharmer distinguishes between 4 levels of listening (see Scharmer, C. O., & Kaufer, K. (2013). Leading from the Emerging Future: From Ego-System to Eco-System Economies. San Francisco: Berret-Koehler Publishers.). Level 1 is superficial listening. It basically serves the function that the listener wants his or her opinions or judgments to be reconfirmed. In level 2 the listener notices and acknowledges differences and captures new information from the other side. Scharmer calls this level ‘factual listening’. In level 3 the listener is not only aware of the other person but actually sees things from the other perspectives, walks in the shoes of the other person. The deepest level of listening, ‘generative listening’ as Scharmer calls it, allows the people connect with each other.

It is this generative listening what you need to practice if you want to help unfold organizational potential and performance.

Hence, forget traditional organizational development!

My friend and colleague I mentioned at the beginning of this post was right: Traditional organizational development is a dead end street.

Posted in: Centeredness, Creative Economy, innovation, Leadership

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2016: what’s to BE


Yes, I do have a number of new year’s resolution.

colored_custom_year_text_11844Here is a list of topics I would like to write about:

  • Building a Happy Workplace
  • Forget HR: Why “HR” is detrimental to organizational health and business growth (and what we need to do instead)
  • The forgotten dimension of innovation
  • Who ought to be the real business enabler in an organization
  • 1+1+1 = x.  Measuring organizational performance
  • Shareholder value is the dumbest idea in the world
  • Innovation: it’s all about people
  • Leadership in the Creative Economy
  • HIP Camp 2016 – Driving Performance, Inspiring Innovation
  • What we can learn from Social Businesses
  • Myopia of traditional economic theory

Conferences I will speak at or plan to attend are the following:

  • KAS meets WEF, Davos, Switzerland (Jan 20-24, 2016)
  • Corporate Social Responsibility Forum, Ludwigsburg, Germany (April 5-6, 2016)
  • Global Scrum Gathering, Orlando, Florida, USA (April 18-20, 2016)
  • PMI Global Congress EMEA, Barcelona, Spain (May 9-11, 2016)
  • PMI Global Congress North America, San Diego, CA, USA (Oct 2016)
  • Global Peter Drucker Forum, Vienna, Austria (Nov 2016)
  • HIP Camp 2016 – Driving Performance, Inspiring Innovation (location and date tbd)

It’s not all about work.

This is why I am looking forward to

  • Family time
  • Mindfulness. Being and motivate to be
  • Music: picking up my saxophone and clarinet again
  • Sports: skiing and snowboarding, taekwondo (3rd Dan?), running, hiking
  • the great outdoors

In other words, there are a lot of people, activities and things to look forward to in 2016.

I wish you all a Happy New Year!

 

Posted in: Centeredness, Company News, Creative Economy, Empowerment, Happiness, Institute, Keynotes, Leadership, TJEP company, Upcoming Events

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Principles for Organizational Performance


In my last blog post I explained that organizational performance and excellence requires strong leadership with a particular mindset to prosper. What does this mean? There are 5 principles that provide guidance for this philosophy and practice to emerge.

  1. Leadership Mindset
  2. Organizational Structure
  3. Commitment & Discipline
  4. Continuous Self-Improvement (CSI)
  5. Operational Stability & Quality Delivery

(1) Leadership Mindset

You can use tools, technology, approaches, etc. for a given purpose. However, if your heart is not in it, it is not only inauthentic but your practice remains hollow and an empty shell. Organizational performance and excellence requires a holistic, disciplined and committed servant leadership style. Holistic leadership in this sense means that all four drivers of organizational excellence are understood, supported and practiced day in, day out. Disciplined and committed leadership means that it is understood that organizational excellence and performance takes time to develop. Corollary, leadership understands the importance of long-term thinking. It knows the motivation of the organization and where it comes from, it has a deep understanding and appreciation of its customers and their needs. Based on this motivation leadership helps develop a vision for the organization as a whole and secures common understanding and support of this vision. The vision serves as guidance and orientation for everyone working in and for the organization. It thus helps people derive concrete long-, mid- and short-term goals and practices for the organization.

I call the interacting balance of motivation, vision and practices of an organization the MVP of an organization. It is crucial for organizational performance and excellence to develop that leadership knows, supports and communicates the MVP of the organization. The MVP of the organization help put short-term goals into perspective. No doubt, quarterly results are important. But they have to be seen into perspective. Not short-term profits (EBIT) are the drivers of business but the health of the organization which encompass its clients, people and the business as a whole.

(2) Organizational Structure

Last year I conducted a workshop for an organization where the leadership team told me that their employees were complaining about a heavy workload, resulting overtime and a deteriorating work-life balance. I was asked to conduct a ‘Happy Workplace Workshop’ to develop mitigation activities. (I will explain the setup of such a ‘Happy Workplace Workshop’ in a future post.) The results were surprising: It was not really the workload that caused the addressed issues. It was the structure of the teams and collaboration rules that caused the imbalances. While individuals more or less knew their specific responsibilities, the teams lacked a clear vision and common goals. There were no standard procedures for synchronizing the efforts in and between teams. This lead to inefficiencies, redundancies and overtime.

Together the workshop participants revisited the organization’s motivation, vision and practices and found ways to translate them for their own realm of work. Roles and responsibilities were qualified and adjusted to the needs of the customers and the teams. Rules for open, transparent and conversational communication were defined and confirmed by management. – Within 3 weeks following the workshop the issues of a heavy workload, resulting overtime and a deteriorating work-life balance ceased to exist. Interestingly, it was not management that came up with these changes. It were the teams themselves that developed and realized relevant mitigations.

The workshop clarified that it is important to build and nurture autonomous teams with clear, commonly understood and supported vision and goals, roles and responsibilities. Communication in and between teams has to be open, transparent and conversational (vs. top-down and hierarchical).

(3) Commitment & Discipline

Leadership is not limited to one or two people “at the top” of an organization. Leadership can be practiced by everyone regardless of his or her role. On this token the principles for organizational performance ought to be understood, supported and committed by the complete staff. This requires discipline on all organizational levels. There is no textbook for practicing the principles in a precisely defined way. Principles serve as guidelines and orientation. Rather than following a strict procedure, encourage sharing of practical experiences of the principles in form of personal stories so that people can relate to them in their daily work.

Performance merits recognition. Some organizations have a bonus system in place. This can work and promote organizational performance as long as it is transparent, fair and objective. For example, it can be based on commonly defined key performance indicators (KPI’s). Since teamwork is crucial in more or less every modern organization team performance should be rewarded (vs. individual performance in a group). This fosters team spirit and accountability.

Processes, tools, procedures and policies can make work runs smoother. But, and this is a big BUT, they are only tools and serve a purpose. In other words, make smart use of them. It doesn’t add value to use a tool for the sake of the tool. Standardized work can be a great help and serve to make work more efficient and productive yielding better quality and hence value. However, standardized work, too, is just a tool and hence should remain a servant and not become a master.

(4) Continuous Self-Improvement (CSI)

It is funny and frustrating at the same time, when companies claim to be innovative; yet, when you talk with employees they tell you that mistakes are punished and that innovative activities are tightly planned. What an oxymoron! If you want to be innovative you have to be willing to try new things, make mistakes and learn from them. Innovation happens at the border between known and unknown. You may set up organizational structures for innovation but you cannot specify innovation in advance. Instead, make sure that you build an open, transparent, collaborative and engaging environment for continuous self-improvement. Recognize and encourage small and not just big improvements. Sometimes little changes can make a big difference.

In an open innovative environment there are no organizational boundaries. I witnessed the opposite in one company where people were asked to submit their suggestions for improvements. Unfortunately, the process was not open and stifled the innovation process at the bottom. Shopfloor workers first had to ask their supervisors to evaluate and then forward their ideas to the next higher level. Not too surprising, engagement for innovation on the shopfloor was more or less non-existent.

If you are faced with redundant, inefficient processes, procedures, tools or practices – eliminate them if they are waste and do not add value.   The suggestion program mentioned above would be an example of such waste.

(5) Operational Stability & Quality Delivery

At the end of the day, the bottom line, the organization has to deliver. Not once but in a consistent and stable manner with high quality and reliability.   You can say that the previously mentioned principles for organizational performance are organizational prerequisites for operational stability and quality delivery. However, it does not mean that one principle is more important than another.   Instead you have to take on a holistic, systemic approach, take all principles into account and take discrete steps toward your organizational vision and goals. Discrete steps have to be part of a larger picture. For this to work, there is a need for long-, mid- and short-term organizational as well operational priorities. And they have to be transparent, i.e., known and supported by the whole workforce. A plan by itself may be of little value. As part of a bigger, long-term plan and vision it can give people the necessary direction and orientation. If reviewed regularly to check whether or not it still serves its purpose for leading an organization toward its vision, this plan is a cornerstone of operational stability and quality delivery.

Leadership Principles for Organizational Performance

While these 5 principles for organizational performance are primarily based on my own experience and insights, they are also examples of the modern leadership style required in the Creative Economy. If you are interested in learning more about this leadership download the free Report of Learning Consortium for the Creative Economy.  Plus, I will share about my personal experiences and findings with the Learning Consortium in a future post.  Stay tuned.

 

Posted in: Creative Economy, innovation, Leadership

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The Heart of Organizational Excellence


In times of increasing competition in the marketplace, organizational excellence or performance is ever more important. But what does ‘organizational excellence or performance’ actually entail? What does it mean? And how can it be achieved? And, even more important, why does it matter?

I believe that there are three drivers for and to organizational excellence and performance. (1) delighting your clients, (2) building a happy workplace, and (3) sustaining business value. Let’s have a look at each one of these drivers to get a better understanding of what’s behind them.

The three drivers of organizational excellence

(1) Client delight

hand_thumbs_up_cuff_15176Say, you have been staying at a hotel. The hotel was decent, your room was clean and spacious, breakfast was good and they even served some fresh fruits. On a scale from 1 = bad to 10 = excellent you may give this a hotel a 5 or 6 rating. You were satisfied. But you were not fascinated or delighted in a way that you would recommend this hotel to your peers, closest friends or family members.
The next time you visit the same city you are staying in a different hotel. This time it is a completely different story. The check-in runs smoothly, everything has been prepared for you, the room is just as clean as it was in the other hotel. But there is something special about this hotel. It could be the location, the architecture, the furniture, the people working there and serving you.   No doubt, you are willing to return to this hotel. And even more so, you will probably recommend this hotel to your peers, closest friends and family members.

In the first example you were a satisfied customer. In the second example you were delighted. Which hotel do you think will have a better business outlook?

When running a business you have a choice. You can do the bare minimum to satisfy your customers or you decide to go the extra mile and delight your customers. In either case the prerequisite is that you know who your customers are. As self-explanatory as this is, there are a lot of companies that seem to have forgotten whom they really serve.

Another question every business should be able to answer is whether or not it wants to build customers for life or only for the short-term. What is more important quick, short-term profits or a long and outstanding customer relationship with long-term, sustainable profits which may yield less quick wins but greater pay offs in the long run?

And what about the customer’s perspective? Which company do you want to do business with. One which treats you like a number, a resource or a sole revenue source. Or a company that reaches out to you, seeks to understand and satisfy your needs, communicates with you, walks in your shoes and shows a sincere interest in you? – Client delight is about the second company.

(2) A happy workplace

group_jumping_up_400_clr_12574Most companies speak of their employees as assets. This sounds good and wonderful. But then, ‘assets’ for what? Are the employees just resources that add up to a bigger picture, the companies outcome, products and services? Unfortunately, most average companies fall into this category. This is not to say that treating people as human resources or human machines is advisory. Especially not if you are interested in organizational excellence and performance. Yes, you can train and treat them like machines, push them to their limits, get the most out of them – for some time, until they are either burnt out or leave your company. You replace them and start the process anew.   You may be interested and actually achieve employee satisfaction. However, this is not to be mistaken with inspired, motivated and performing employees who enjoy their work because they can identify with the purpose of the company, love working with their colleagues and serving their customers, are passionate about their work and enjoy a safe, secure workplace.

Companies can build such a workplace. Just as knowing the needs of their clients they have to show a sincere interest in the needs of their employees. It starts with a safe, secure and environmentally friendly work environment. For employees to follow a direction you have to set it, share it and let your employees contribute to it. Let them become a part of it.

A happy workplace does not mean that you have to do everything just to please your employees without expecting anything in return. Of course not. But you have to provide or at least build an environment where they can prosper and perform at their best. A first start is that you don’t treat employees as resources but as people, as human beings.

(3) Business value

Growth curveThe former CEO of General Electrics, Jack Welch, describes the call for maximizing shareholder value as the dumbest idea in the world. Other describe it as corporate cocaine. In either way, the bottom line is that shareholder value is not identical to business value.

Think about the following: you want to invest into a company, or even better, you want to acquire a company. What do you look at? Just the present stock price and its outlook? Of course not. You take a number of factors into account: the overall business performance and outlook, customer satisfaction ratings, market position, innovation performance, the skillset and turnover rate of the workforce, the attractiveness of the company as an employer of choice and many other factors. But how come most companies these days just talk about satisfying shareholder interests and maximizing shareholder value?! Shareholder value is the result of a well-run business and not the other way around. Hence, treating shareholder value as the purpose and driver of your business is not smart but myopic and can even be detrimental to the value of your business. From a business perspective, it is plain stupid.

The sweet spot of organizational excellence

The sweet spot of organizational excellence is where all three drivers outlined above come together. If you depict the three drivers as three circles, it is the area where all three drivers overlap that you can spark organizational performance and excellence.

Venn Diagram - Org. Excellence

 

This is not a one-time effort. You have to continuously improve your own performance to stay in this sweet spot. In this sense, continuous self-improvement can be considered a fourth driver of and for organizational excellence. It adds a dynamic dimension to organizational excellence. Rather than a static Venn diagram with three circles we can depict this as a Möbius circle.

neutral Leadership Cycle of Organizational Excellence

 

The bigger the overlapping areas of all three drivers, the better organizational performance is. This implies that in order to develop organizational performance you have to take all four drivers into account. This holistic view requires leadership, a specific mindset, philosophy and practice. It is not solely driven by short-term gains but balances long-, mid- and short-term needs and goals. It is has a clear customer and people focus and nurtures an open innovative culture.

It is this leadership which I will write about in my next blog post. Stay tuned.

Posted in: Creative Economy, Leadership

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