Leadership

The Three Leadership Competencies That Matter Most in Times of Crisis

In times of crisis and uncertainty, people experience the gamut of emotions. Some are afraid (of both the known and the unknown). Some people get angry, others are frustrated. Some get depressed and some feel lonely. The list goes on…

It’s because of this wide range of negative emotions that leaders need to step up and play an important role. Leaders need to de-escalate anxiety and fear, and they need to offer hope for the future.

Although there are many traits and competencies a good leader must possess, three stand out as critical in times of crisis – Executive Presence, Empathy, and Effective Communication.

EXECUTIVE PRESENCE
Having executive presence is the ability to project mature self-confidence, to project a sense of being able to take control of difficult situations, and to project the ability to make tough decisions. There’s no one thing that gives a leader executive presence. Instead, it’s a combination of a number of factors:

Confidence: Especially during a crisis, a leader must display a strong level of confidence without being overly confident. It’s OK not to have all the answers. And it’s OK for people to know a leader doesn’t have all the answers. In fact, being open (transparent) and honest (vulnerable) act to build trust and respect. Be confident, but not casual or over-confident, in order to have executive presence.
Decisiveness: In business, postponing a decision until more facts are revealed or the future becomes clearer can be a smart course of action. But often, leaders must make decisions without all the facts and without certainty about the future. Even though the future may be cloudy, a leader with executive presence must make decisions in the face of that uncertainty.
Authoritative: How a leader leads should vary with circumstances (situational leadership). Under normal circumstances, it might be most effective to lead by getting buy-in for an idea or by coming to a decision by consensus. But in times of crisis, a leader must be strong and act in an authoritative manner in order to have executive presence.
Body Language: Our body language communicates a large amount of information. Body language includes how we hold ourselves when we sit, stand and walk. How a leader carries him or herself reflects their state of mind, so it’s important to sit and stand in a manner that projects and instills confidence. In addition, facial expressions matter. People often read others by their facial expressions. A leader’s expression shouldn’t reflect casualness, anger or fear if their intent is to instill confidence. A leader with executive presence is mindful of his or her body language.
Emotional Control: For leaders to instill confidence, earn trust and earn respect, they must stay in control of their emotions. Emotional outbursts are seen as a loss of control and people know that a leader who loses control is feeling overwhelmed. An overwhelmed leader lacks executive presence. Be mindful of emotions and the expression of those emotions in order to have executive presence.

In times of crisis, it’s important to have a strong executive presence.

EMPATHY
A leader who has empathy understands the feelings, needs and concerns of others. He or she is able to define, understand, and react to the concerns and needs that underlie people’s emotional responses and reactions.

The issue here is the importance of treating people like people rather than like “things”. When a leader regards people as people, he or she acknowledges that everyone – regardless of position or tenure – has hopes and dreams, fears and stresses.

Although it’s never productive to treat people like “assets” or “resources”, it’s especially true in times of crisis. If a leader communicates and deals with people as if they were “things”, it demonstrates that the leader doesn’t care about them. And a leader who doesn’t care about the people he or she leads loses the respect and trust of those people.

It’s not that a leader with empathy accepts mediocrity or doesn’t hold people accountable. Instead, having empathy is about HOW they hold people accountable and how they bring out the best in people. Most people want to do a good job – especially in times of crisis. By being understanding and helping people be productive given their specific circumstances, a leader will get more engagement, better results, and earn their loyalty.

In times of crisis, it’s important to have empathy and treat people like people.

EFFECTIVE COMMUNICATION
Especially in times of crisis, how and what we say can have an enormous impact on people. People are quick to interpret (or misinterpret) messages. People are more sensitive to tone and languaging. And people are looking for reassurance and hope.

In times of uncertainty, it is essential for a leader to choose his or her words carefully. Leaders must make sure they say exactly what they mean to say. Read and then re-read each note and/or message. Try to read it from the point of view of the reader to ensure the message can’t be misconstrued. Make sure the wording has the right emotional “feel” as well. Remember, the reader can’t hear inflections or emphasis when they read the note.

Along those lines, often a phone call, conference call or video call/meeting can be a better solution for addressing issues than written communication. People can hear a leader’s tone and sincerity in their voice. If video is added to the equation, people also get to see a leader’s body language.

In times of crisis, it’s important to take time to craft each message and how it’s delivered.

If you’d like help with any of this, reach out to us. We specialize in helping leaders become more effective and help them bring out the best in people.

The Three Most Common Leadership Weaknesses

Over my 20+ years as an executive coach, I’ve worked with and assessed lots of smart, experienced senior leaders. And with each assessment I did, a pattern began to emerge. I noticed that there were several important competencies that almost always are among their weakest.

This pattern is interesting, because these leaders are very
smart, have many years of industry experience, and are responsible for many
millions of dollars of revenue and profit.
They’ve been CEO’s, presidents, owners, CFO’s, CTO’s, VP’s and
directors. And yet… these competencies
regularly show up as some of their weakest competencies. These three competencies are their ability to
coach & mentor, their ability to
influence others, and their ability
to resolve conflict.

Why are these competencies so often among the weakest? I believe it’s because the skills necessary
to excel at them don’t come naturally to most people – regardless of
intelligence or experience. Here’s why
these three competencies are so critical to a leader and how to go about
improving each one.

Coaching &
Mentoring

One of the most important responsibilities of a leader is to
develop the people below him or her.
There is tremendous opportunity and satisfaction as a leader in
developing others. By effectively
developing the people around us, we elicit excellence in a number of impactful
and far-reaching ways.

Study after study has shown that an important factor in
driving engagement is having the opportunity for professional growth. When a person becomes stagnant, they become
bored and disengaged. As a leader helps
someone expand their skill set and knowledge base, they make them more valuable
and more versatile. In addition, when a
leader coaches and mentors someone, they demonstrate their belief in them,
their abilities, and their potential, which nurtures loyalty and
responsiveness. One additional benefit
of developing others is that it allows a leader to groom someone to take their
place, thereby paving the way for the leader’s promotion.

Given the impact and far-reaching implications of developing
others, it is critical to master this important function, and adopting a
“coach-like” attitude and manner is the fastest and most effective
means of accomplishing that.

What does a coaching style of leadership look like? Coaching embodies a number of competencies
and strategies. Many of us, in an effort
to help someone “get it right” (and in the name of expediency), tell
others what to do and how to do it. And
while this does get the work done, it does little to develop the other person,
their skill set, and their confidence.

The alternative – the coaching approach – is to ask rather
than tell. Instead of starting off by
telling them what to do, ask them what they would do and how they would do
it. This strategy serves a number of
very important functions. Firstly, it demonstrates
that you have an interest in what they have to say. When you listen to someone, it acts as a sign
of respect because it demonstrates that you value what they have to say. The next benefit of asking is that their
answers will give you a sense of how they think. The answers will reveal their level of
insight and judgment and will illustrate their problem-solving abilities. And lastly, listening to the answers to your
questions will provide clues as to how best to help them develop. It helps you understand which aspects of
development they need help and guidance with.

Influencing

Mastering the ability to influence others is critical to the
success and effectiveness of a leader. A
strategy, no matter how well thought out, will get mediocre results if there
isn’t strong buy-in. A leader will
always get compliance because of his or her authority. But compliance and commitment are two
different things.

If people are compliant, they will generally do just enough to
keep from getting fired. The consequence
is that a strategy will get results, but not nearly to the level of a strategy
executed by a committed team.

How do you influence people?
How do you change their perspective so you get buy-in? People “buy” emotionally. It’s true whether you’re selling TV’s, cars,
ideas or strategies. They buy
emotionally and then rationalize logically.
There are two tools to employ in order to change someone’s perspective. They are the use of question-asking and the
use of analogies.

Asking good questions is an art. It took me many years to master it, with lots
of practice and plenty of missed opportunities.
I’ve found that there are two sets of questions that need to be asked. The first set of questions are those that
give you insight. They are curiosity questions that help you
better understand why someone sees things the way they do, thereby allowing you
to effectively change or correct their perspective. The second set of questions are those give them insight. They are questions that help them rethink
things.

The second tool for influencing people is the use of
analogies. Analogies are an excellent
vehicle for bringing someone around to your way of seeing things. Generally, you’ve been giving the issue at
hand far more thought than they have and therefore have a deeper understanding
of the problem and/or solution. Using an
analogy helps people “see” and “feel” the concept you’re talking about and does
it in such a way as to keep them from becoming defensive with respect to their
position. Once you’ve come up with a
meaningful analogy, it’s much easier for someone to shift their thinking and
their perspective.

Resolving Conflict

The ability to resolve conflict is essential to a leader’s
effectiveness. If conflict is allowed to
fester, it erodes engagement and erodes the respect a team has for its leader.

Workplace conflict tends to arise from poor communication, unmet expectations, differing perspectives, and stress. Ultimately, these each can be minimized or eliminated by improving interpersonal skills, setting clear expectations, shifting people’s perspectives, and helping to reduce stress. But the stage has to be set before the issues can be resolved.

The blueprint for resolving conflict starts with acting to
avoid further escalation. The more
frustrated and upset a person is, the more difficult it is to resolve a
situation. The next step is to
de-escalate the situation. I’ve found
that an excellent way to begin that process is to “state the obvious”. “Stating the obvious” means simply to
acknowledge that the frustration and/or disagreement exists. It’s often the perfect way to open the door
to resolve conflict. Just by starting
with, “Look… we’re both frustrated by this,” sets the stage for a
resolution. It acknowledges that you
recognize the other person is frustrated, it doesn’t point a finger at them,
and it implies that you’d like to work things out.

Once the stage is set for coming to a resolution, the next
step is to understand the other person’s perspectives and or motivations. As discussed above, the most effective means
of accomplishing this is through the use of good questions. In this case, a “good” question is one of
curiosity about why they feel the way they do, phrased and asked in a manner
that keeps them from becoming defensive.
A simple example of what a good question might be is, “What am I doing
that frustrates you?”, followed by, “Why does that frustrate you?” In contrast, a question that would cause them
to become defensive would be, “Why do you have to get so angry?” Once you gain insight into the underlying issues,
you can work together to resolve the conflict.

If you’d like help improving your ability to coach &
mentor, influence others and/or resolve conflict, please give me a call.

Leadership Development is Key to Business Value

Our research suggests that the pace of exits and successions will begin to increase this year. This conclusion is due to several factors. Life expectancy in the U.S. has risen above 80 years old, up from 72 several decades ago. Accordingly, the expectation of retirement age has also risen. When life expectancy was 72 years old, retirement age was considered to be 65, but now, because people are living longer, owners are waiting until their 70’s to retire. And the final factor suggesting increased activity is that the leading edge of the Baby Boom generation turns 73 this year.

As I’ve written in another article, the number of businesses that will hit the market in the coming years will far outstrip the number of interested buyers. The consequence of this excess supply is that only the most attractive businesses will find a buyer.

Although there are several important factors that make one business more attractive than another, a key issue is the strength of the leadership team. The strength of a leadership team not only impacts the value of a business but affects the likelihood that the deal will close.

Ken Sanginario, founder of Corporate Value Metrics and creator of the “Value Opportunity Profile” is an expert at valuing companies. He helps them increase their value and improves the likelihood they will sell. According to Sanginario, the strength of the leadership of a company will influence the value of a company by as much as 15-20%. By way of example, if a company has a capitalization rate of 20%, strengthening the effectiveness of the leadership team can realistically increase its capitalization to an effective rate of 17% – a significant boost in sales price.

Additionally, if a business’ leadership team is weak, the likelihood that a deal will go through diminishes dramatically. Tom West, author and president of Business Brokerage Press has stated that businesses with a seven-figure sales price will only close 25-33% of the time.

Therefore, if you (or your client) want to maximize the likelihood of selling a business and selling it at full price, the strength of the leadership team must be addressed.

Here’s what has to happen. The leadership competencies of the team need to be assessed so their strengths and weaknesses can be identified. Once the assessments are done, a program of leadership development should be undertaken to ensure the team’s effectiveness. Although development can usually be accomplished in about six months, this initiative should be started 2-5 years in advance of a transition. Because, just as one good year of EBITDA won’t impact a business’ value very much, neither will one year of strong leadership. You must demonstrate a pattern. Don’t wait until a few months before you go to market to address leadership issues. Start now, establish leadership effectiveness, and boost buyer confidence.

If you’d like help assessing and developing your leadership team, please contact us. It’s our specialty and our passion.

Peer Groups Aren’t Effective for Developing an Executive

If you’re a CEO or President of a company, a peer group can be a really valuable asset because it a) provides networking opportunities, b) provides outside perspective on strategy, and c) allows you to help others. But peer groups aren’t effective at developing an executive’s leadership competencies. There are a number of reasons for this.

The first reason relates to the fact that leadership competencies are developed over time. 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 reason relates to assessment. Peer groups aren’t designed to assess a leader’s strengths and weaknesses. The group can only discuss issues that someone brings to the table, and of us are poor at assessing the quality of our leadership abilities. In fact, I’ve never met an executive who thought they were a poor leader. Yet, we all know many executives who are poor leaders! This reality makes leadership development in a peer group pretty much impossible.

The third reason 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 in order to improve productivity.

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, many executives turn to executive coaching to provide the assessment, insight, and guidance needed to improve. 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, objective sounding board useful, please give us a call at 503-928-7685.

When Successors Manage Instead of Lead

Most owners feel they’ve done a good job preparing their successor, yet many successors fail once they take over. One of the major causes is that they continue to manage the company rather than lead it. And when people get “managed” engagement drops and results suffer.

Two of the most common ways an executive “manages” people are by “treating people like things” and by “treating adults like children”.

How does someone “treat people like things”? They do it in several ways. They do it when they’re insensitive to them and interact with people as if they have no feelings. They treat people like things when they ignore the fact that everyone has hopes and dreams and fears and stress. They treat people like things when they relate to people as if their own goals and aspirations are more important than another person’s goals and aspirations. And they treat people like things when they don’t show respect for people nor value their contributions, efforts, and potential.

When someone treats a person like a thing, it sends the message that they are unimportant and that they just don’t care about them. And when people sense a leader doesn’t care about them, they start not to care about that leader. When the company tolerates leaders who don’t care about people, people tend not to care about the company. And when people don’t care, there is no engagement.

In contrast, an effective leader understands that people’s hopes, dreams, fears, and stresses are real and matter to them. A leader inspires people. A leader interacts with people as people, helping them to be their best. A leader treats people the way they themselves want to be treated. And a leader helps people achieve their own goals.

How does someone “treat adults like children”? Think for a moment about how parents relate to children and why they relate that way. They generally tell children what they need to do and when they need to do it. They do that because they don’t trust a child’s judgment, their sense of responsibility, and/or their self-discipline. They regularly check up on children because they don’t trust them to follow through on their commitments. They check up on children because they don’t trust them to be responsible.

When a leader doesn’t trust people to do what needs to be done and doesn’t trust their judgment, he or she is treating them as if they are children. When they micromanage people, they are treating them like children. And when they treat people like children, it shows a lack of respect and trust. When people feel they aren’t respected and trusted by a leader, they lose respect for that leader. When people feel they aren’t respected and valued, there is no engagement.

If someone doesn’t know what to do, then our job as a leader is to develop their knowledge and abilities. The shortcoming lies with the leader, not the follower. If someone lacks the necessary judgment for a task or decision, then our job as a leader is to develop their judgment. If their judgment remains inadequate, then either we aren’t as competent a leader as we need to be, or we just have the wrong person on our team. Either way, resorting to treating someone as a child is a poor course of action.

Regardless of how well a successor knows the mechanics of a business, if they don’t hone their leadership skills, the best they can hope for are mediocre results.

If you’d like help evaluating your successor’s leadership abilities and/or help with developing their weaker areas, please contact me.