Leadership

Misuse of “The Hammer” by Leaders

I’ve never met an executive who thought they were a poor leader. Most will say there is always room for improvement, but that they generally do a good job. And yet… we all know people who are poor leaders!

These leaders often feel that they know what should be done and how it should be done. So they adopt a “command and control” style of leadership, “guiding” the people around them. If they aren’t successful at getting their way they “pound” on them – basically ordering them to do what they say. I call it “using the hammer”.

This approach is appropriate for urgent situations or emergencies, but is rarely effective in most other circumstances. At best, when a leader takes this approach, they simply get compliance from their people. At worst, they elicit passive-aggressive behavior. And to compound matters, the results gained form compliance are weak compared to those gained by a committed workforce.

In essence, they’re treating adults like children. This style of leadership demonstrates that they don’t trust or respect those around them. It shows that they don’t value them as professionals and it generally causes disengagement. Micromanaging is a common variation of this style of leadership.

If a leader really wants to bring out the best in people, he or she needs to treats adults like adults and professionals like professionals. Effective leaders learn how to influence and persuade people to buy into their ideas and suggestions. Effective leaders give people autonomy, allowing them to do their work in their own way.

That’s not to say that these leaders accept mediocrity. Far from it. In fact, this approach – when done correctly – allows a leader to hold people more accountable and it allows them to hold people to a higher standard of performance.

Besides, taking this approach doesn’t take away any power from the leader. A leader always reserves the right to use “the hammer” and tell someone exactly what he or she wants done. It should only be used when a leader’s powers of influence fall short and/or when someone’s judgment is flawed. A leader always has the prerogative of dictating what should be done and how it should be done. But using the hammer is a last resort when nothing else works.

Everyone feels they have something to contribute and want to be heard. The key to bringing out the best in people is to value and respect them. Eliciting excellence is the essence of exceptional leadership.

If you’d like help in refining your leadership effectiveness, please call. We offer assessments and executive coaching – all designed to boost your leadership effectiveness.

Common Shortfalls in Successor Development

When it comes to handing off their business to a successor, every business owner understands the importance of grooming their successor to take over. And most owners feel they’ve done a good job. But while most owners ensure a successor understands the business, many owners don’t do the leadership and ownership development required to help their successor succeed. In fact, studies show that over 2/3 of successions fail!

Here are three of the common mistakes owners make in developing a successor, along with suggestions on how to correct/overcome them.

BELIEVING THAT BUSINESS KNOWLEDGE IS SUFFICIENT
Most business owners know that a well-groomed successor should have at a working knowledge of operations, sales and marketing, customer service, administration, and finance. But this knowledge, although necessary, is not sufficient if a successor is to effectively lead a company into the future. In addition to having a firm grasp of the mechanics of the business, a successor must become an effective leader, have vision and foresight, think strategically, have good judgment, manage risk, and adopt an owner’s mindset. Each of these capabilities takes time to develop and requires regular coaching and mentoring by the owner and/or a professional executive coach.

In the absence of this development, a successor will be more likely to send the company in a poor direction, thereby jeopardizing future cash flow and profitability.

ALLOWING BLIND SPOTS TO RESTRICT THINKING
It’s very common for an owner (and in fact, an entire organization) to think and approach problem-solving in a certain way. The phenomenon is called “group think” and can even permeate an entire profession. “This is the way we do things around here…”

This pattern creates “blind spots” that prevent new, innovative solutions from being considered. In other words, these blind spots keep people from seeing what they’re missing. If an owner suffers from having too many blind spots (we all have them), he or she may very well pass them along to their successor. “After all, certain solutions have always worked in the past…”

The best way to reveal blind spots and enable creative thinking is to have a fresh pair of eyes and ears examining and challenging current beliefs. Almost always, an outside, unbiased and objective perspective is required.

FOCUSING ON SYMPTOMS RATHER THAN PROBLEMS
Typically, successors have become excellent managers – effectively allocating resources, driving productivity, and adroitly responding to day-to-day demands. However, the role of manager is often one of reacting to issues as they arise and then developing tactics to address them. Leaders, on the other hand, need to think strategically. They need to develop strategies that address problems, rather than to develop tactics that address symptoms.

The reality here is that “solving” a symptom (instead of the underlying problem) usually leads to the creation of more challenges. Additionally, addressing a symptom is simply a band-aid. The problem never goes away. The key to developing a great strategy is to spend time identifying the real problem. A successor needs to learn how to dig deep enough into a situation to uncover the problem. Only by accurately identifying a problem can an effective strategy be developed.

An owner (or a competent executive coach) needs to mentor a successor in how to uncover problems and create sound strategies. This process will help a successor develop critical thinking, sound judgment, and strategic thinking – all required to successfully take a company into the future.

A good place to start is with our free Successor Readiness Questionnaire. It can give you a sense of how ready your successor is to take over.

By grooming a successor beyond the mechanics of a business, an owner will increase the likelihood of business continuity, and ensure future cash flow and profitability.

If you’d like help assessing and developing a successor, give us a call – 503-928-7685. We offer executive assessments and executive coaching – all designed to help successors succeed. In addition, we work with owners to strategize on how they can best mentor their successor.

3 Succession Pitfalls to Guard Against in a Closely Held Company

A well-planned exit strategy is critical to an owner looking to retire and hand-off their business. But the unfortunate truth is that about 70% of all next generation businesses fail. The reason? The majority of the time, the issue is a poorly prepared successor. Ideally, the chosen successor has learned the business of the company and demonstrated a commitment to it. And hopefully, they’ve also learned how to market the company’s products and services, service the customers or clients, and can understand the business’ financial statements.

In addition, there are several other things that are required, such as the ability to develop a compelling vision, the ability to think strategically, the need to develop an Owner’s Mindset, the ability to influence others, and the need to develop a strong executive presence.

However, even when the new leader has all of this knowledge and has improved these leadership competencies, there are several pitfalls that must be avoided if the new leader is to be successful as they guide the business into the future.

Pitfall #1: Making Changes Simply to Prove the Successor Is in Charge

There are two aspects to this pitfall that need to be addressed. First, newly acquired power, responsibility, and authority can be intoxicating. It can be tempting to flex one’s new leadership muscles. This temptation can arise from years of having ideas without the authority to implement them or it can arise if the new leader feels he or she must establish his or her leadership competence in the eyes of employees. The second aspect pertains to the successor’s relationship with the founder. There may be a tendency to arbitrarily make changes simply to establish that he or she is now in charge, not the founder.

In either case, making changes simply for the sake of change is a mistake. A wise leader will reflect on his or her motivations for wanting a change, show restraint, and reflect good judgment before making any changes. Change for the sake of change is destined to cause problems rather than solve them.

Pitfall #2: Continuing to Think (and Act) Like an Employee

After spending his or her entire career as an employee, the successor must adopt an Owner’s Mind-set. There are several differences between the way an employee thinks and the way an owner thinks, and if this shift doesn’t take place, problems will arise.

Employees tend to think narrowly. They usually focus on the task at hand and/or on their specific domain of responsibility (operations, finance, engineering, etc.). In contrast, an owner needs to consider the bigger picture and how his or her decisions impact each aspect of the business.

Employees tend to think short-term. Their focus tends to be on current matters, current revenues, current expenses, and current profits. On the other hand, an owner needs to consider both short-term and long-term success, learn to make decisions without having all of the information about the future, and must learn to balance risk and reward. Rarely is a decision about the future risk-free, and an owner needs the ability to assess and minimize that risk.

Additionally, employees tend to focus on doing good work while at work but generally don’t take their work home with them. On the other hand, owners learn that the business becomes their lives, and they think about it at all times, wherever they are.

Finally, employees know that if they make poor decisions, the business doesn’t do well, they become dissatisfied, or they lose their job, they can always find a new job elsewhere. Owners understand that failure is not an option. Generally, there is no “Plan B.” They understand that the business is their only future, and this understanding colors their decisions and actions.

Pitfall #3: Not Earning the Confidence of Others Within the Organization

The degree to which leaders earn the trust and respect of others determines the effectiveness of their leadership. There’s a big difference between the results gained from people who are simply compliant and those gained from people who are committed. Exceptional leadership elicits excellence.

In order for leaders to be effective, they must earn the trust and respect of those around them. A new title doesn’t automatically bestow the trust and respect of others onto leaders. Although industry knowledge can earn a new leader professional respect, leadership trust and respect are earned through everyday actions.

Trust is earned by demonstrating integrity. It is critical for leaders to follow through on their commitments. Actions truly do speak louder than words, and good intentions won’t cut it. Leaders may have the best intentions when they agree to a list of commitments, but if they don’t follow through on those commitments, they’re viewed as lacking integrity.

Likewise, if a leader states that certain values are important to him or her but then acts in a manner at odds with those values, that leader demonstrates a lack of integrity. When that happens, people learn not to trust that leader.

Respect must also be earned. The most effective way to earn respect is to show respect. As leaders, we show respect when we listen to what others have to say. People often feel they have good ideas and have something to contribute. Whether we agree with them or not, soliciting input from others demonstrates that we value them and their ideas and in turn earns their respect. The most effective means of showing respect for others is asking good questions of people and then listening to their answers.

Where to Begin

Here are several questions you should ask to help determine whether a successor is ready to take the reins:
(There are many other leadership competencies necessary, but these questions are a good starting point.)

Is the successor’s ego in check?
Has the founder made all of the decisions to this point, or has he or she allowed the successor to make decisions and mistakes?
Is the successor mired in day-to-day operations, or can he or she rise above the mundane and see the bigger picture?
Is the successor respected and trusted within the organization or is he or she simply the owner’s child/relative?
Does the successor feel that he or she has been stifled by the founder?

Asking and answering these questions will help you determine whether further executive development is necessary. Not every founder has the skill set or time to help the successor develop. However, a leader’s ability to bridge that gap can be the difference between a successful transition and one that languishes in mediocrity.

If you’d like a tool to help you gage a successor’s readiness, we have a free “Successor Readiness Questionnaire” you can use. There’s no obligation or cost. Just useful information to help you. It’s a list of questions you can ask that will help determine whether successors are ready to take the reins. We developed these questions as a result of the leadership issues we’ve encountered over the last 18 years.

http://www.elicitingexcellence.com/successor-readiness-questionnaire

If you find that your successor needs further development and you’d like help preparing him or her for a transition, please give us a call. We specialize in developing executives for succession, and our team of executive coaches works with clients around North America. A well-prepared successor will help maximize the value of a company and ensure its ongoing cash flow.

Peer Groups Aren’t Effective for Development

If you’re a CEO or President of a company, peer groups can be an asset because they a) provide networking opportunities, b) provide outside perspective on strategy, and c) allow you to help others. But peer groups just aren’t effective at developing one’s effectiveness as a leader. Here’s why…

The first issue relates to the fact that leadership competencies are developed, not trained. It takes regular focus to break ineffective habits and form new, effective ones. Meeting once a month in a round-table setting with big-picture discussions just can’t address someone’s specific development needs.

The second issue relates to assessment. Peer groups aren’t designed to assess the leadership strengths and weaknesses of individual members. That, coupled with the fact that most of us are poor at assessing the quality of our abilities, really makes leadership development in a peer group pretty much impossible. (A good example of how poor we are at self-assessment is the fact that I’ve never met an executive who thought they were a poor leader. Yet, we all know executives who ARE poor leaders!)

The third issue relates to blind spots. We all have them regardless of experience, intelligence and/or education. Peer groups can help point out strategic blind spots, but aren’t very good at pointing out leadership blind spots. It really takes someone working closely, one-on-one with a leader to spot them and bring them to light.

A fourth reason that peer groups aren’t effective at leadership development relates to personal productivity. Group discussions can be good for high-level topics pertaining to business strategies, but they don’t lend themselves to improving day-to-day functioning. Leaders need objective input from someone who has insight into how they function at work.

And a fifth issue in which peer groups fall short with respect to leadership development relates to the need for an executive to have an unbiased confidant – someone with whom they can vent, admit fears and insecurities, and generally open up to. A peer group setting is simply inappropriate for that.

What then, is the best course of action for leadership development? It used to be mentoring by fellow executives – getting insights and guidance from someone in the company who could share the benefit of their years of experience. Unfortunately, because of cost-cutting and increased work load, those days are gone.

Instead, most executives turn to executive coaching to provide the assessment, insight, and guidance needed. Peer groups have their place, but for personal development, one-on-one work is the most effective.

If you’d like help in developing your leadership effectiveness and would find a confidential sounding board useful, please give us a call at 503-928-7685.

How to Ensure a Smooth Succession

All leaders must be good at interpersonal and communication skills, along with good decision making and being highly productive. But the person at the helm – guiding the organization into the future – needs additional, essential competencies.

In order to be successful at running and growing a company, the head of a company needs to be able to develop a vision for the future, must be able to develop effective and meaningful strategies, and must have the ability to influence an organization.

Vision and Foresight
For a leader to guide a company, it is essential to possess the ability to develop a vision for the organization. A vision imagines a future which is better, different, and/or larger than the current state. Without vision, a leader will simply continue to execute the existing business model, often getting left behind as the economy shifts, customer/client preferences change, and competitors adapt. When a leader has and shares their vision, he or she helps others understand the organization’s direction and aspirations, and inspires the organization to improve.

The ability to develop vision can’t be learned from a book. It arises from within and it requires a leader to have passion and purpose for what they do. A passionless leader can only develop goals – which are uninspiring by their nature. If a leader wants to engage his or her organization, he or she must create a future that causes people to aspire to improve.

Strategic Thinking
The ability to think strategically is essential for leaders guiding an organization. Development of a proper strategy allows a leader to prepare an organization for faster growth and profitability. Without an understanding of what a strategy is and how to develop one, leaders will often focus on goals and tactics. In the absence of a true strategy, these goals and tactics are often misguided and usually result in new challenges arising. A misguided strategy can even cause a decline in growth and profitability.

A good strategy addresses an issue or problem and provides a direction for the company. By developing a true strategy, excellent results can be achieved and the desired financial goals realized. In order for leaders to develop a good strategy, they need to uncover what the underlying problem is and not react to the symptoms it causes. A strategy which addresses a symptom always creates more issues.

Influence and Persuasion
Influence is the ability to change people’s perspectives and beliefs. An influential leader has the ability to sell his or her ideas and get buy-in throughout the organization. Without buy-in, a leader simply gets compliance. But compliance is not the same as commitment. The results gained from the efforts of people who are only doing what is asked of them are very different from the results achieved by people who are enthused and committed.

The art of persuasion – our ability to persuade people to see our perspective – relies on our ability to understand the other person’s motivations and perspectives. Once we understand why they see things the way they do, we can then offer a new view of the situation – one which resonates with the other person.

A good place to start is with our free Successor Readiness Questionnaire. It can give you a sense of how ready your successor is to take over.

But the three essential leadership competencies discussed above don’t come naturally to most people. They need to be nurtured and honed. Blind Spots need to be revealed. Limiting beliefs need to be set aside and replaced with stronger, more expansive beliefs. Outside perspective and an unbiased sounding board are usually required.

An Executive Coach offers all that and more. Leadership skills aren’t trained – they’re developed over time. Utilizing the expertise of an experienced executive coach is the perfect solution for grooming an executive for the next level of leadership. Please let us know if we can help you reach your succession goals.

Leadership

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