“These are the little secrets they don’t teach in school or tell you about when you’re working in a large corporation.” – Robert Hawthorne
Robert Hawthorne was President & CEO of Pillsbury Canada, President & CEO of ALPO Petfoods, President of The Pillsbury Company (North America), President of Select Comfort Corporation and the CEO of the Ocean Spray company.
I had the good fortune of meeting Robert at a General Mills alumni gathering. I asked Mr. Hawthorne if he had any “words of wisdom” and he was kind enough to share the advice he gave his daughter when she graduated from college.
What follows are his thoughts on starting a new job and becoming a manager. It wasn’t written to sell a book. In fact, Robert pointed out that these are management techniques “you won’t find in a book.” It’s invaluable insight without the fluff you might find in a self-help guide.
His original email to his daughter grew into three sections (1) The Basics, (2) Becoming a Manager, (3) Advanced Management Techniques. It’s clear this advice is valuable for anyone at any stage of their career.
Again, my sincerest thanks to Robert Hawthorne for sharing this with me … and now the world.
PART 1: THE BASICS
30-Day Plan
In your first 30 days in a new job you have the opportunity to establish how you will work and what you’ll be working on. I would recommend writing out a list of ’30 Day Objectives’. Share it with your Boss and ensure that it has his/her input. It should be simple and clear.
Time Management
Take a Time Management course! Do not hesitate. If your employer doesn’t offer one … sign up and pay for it yourself. This will provide a life long system to organize your day, your life and establish priorities. I am continually surprised by the lack of good time management skills with executives I have coached. This is the one course that everyone should take! Sounds simple…but…most people can’t find the time to do this…. Here’s one tip…take ten minutes at the start of each day and write down what you need to get done. Don’t ever just dive in.
The Tool Box Concept
When you graduate and start your first new job … assume you know absolutely nothing! Your boss will believe this to be true so you might as well be on the same page. Try to think of your knowledge base as a ‘tool box’. Upon graduation the school gives you a big empty tool box containing a screw driver and a pair of pliers. Going forward you will gradually add new tools and by the time you are about 30 years of age the tool box will contain a full set of wrench’s, a power drill, saw and many other things that you know how to use really well. Your job is to build up the tool box by adding more and more sophisticated equipment over time. In my experience it is far more effective when a new employee acknowledges that they have a lot to learn and are willing to do so. People who act like they know more than they really do are always viewed negatively.
Work Hard
There is usually very little difference between recent graduates. They all did well in school and have exhibited leadership skills or they wouldn’t have been hired. Everyone is equal at the starting gate. So how can you differentiate yourself from all the other recent hires? The answer is ‘hard work’. If you work 50 hours a week and everyone else puts in 40 you will gain +25% more knowledge and build your tool box at an accelerated pace. You will also get noticed and be more knowledgeable. If you really want to get ahead this is a prerequisite.
But Work Smart
As your career progresses hard work alone won’t get it done. As I progressed I was getting recognized for long hours but realized that there were ways to work smarter. There were times when I found myself working until 2:00 in the morning and coming in early totally exhausted. There is a fine balance between putting in the elbow grease and working smart. Developing good time management techniques will provide the edge. I also try to think about balance on 4 fronts: Work, Family, Personal and Community. While you are working harder than others at work, you need to have a full, complete life for yourself, your family and for giving back to the community. Too much work can choke out the other areas and the other areas are where you will be remembered after you’re gone.
Entitlement
Years ago I had to remove an executive from their current job. This person had an R&D background and been promoted into a Director of Marketing position. It was clear that he did not have a marketing background and was ineffective in this job. I wanted to move him back into R&D but he was reluctant to go. He pointed out that his failure at the new position was not his fault…it was the fault of the company! He suggested that we send him to Harvard so he could learn all about marketing! He clearly felt entitled. I was flabbergasted. There is a clear difference between entitlement and empowerment. Someone once said ‘entitlement is empowerment run aground’. In business you are not entitled to anything. You must earn it. As you start out, do not fall into the entitlement trap.
Managing-up
Managing-up is all about getting regular, quality face-time with those above you, particularly your Boss. When you start a new job, try to negotiate a regular time to interface with your Boss. Once a week is OK but 5 to 10 minutes every day is optimal. Try to do this each morning. As an employee, your job is to reduce your Boss’s anxiety level to zero. Once you are meeting regularly with your Boss he/she will get to know and trust you. Managing-up requires that you take advantage of opportunities to interact with more senior executives. Use this time to update them on the accomplishments of your team. Always start by delivering the good news. If you launch into the bad news first you will never get to deliver the good stuff and will appear as being constantly negative. I have worked with people who can’t wait to tell you the bad news and tried to avoid them. These managers never seemed to get ahead in their careers.
Saying No
Pushing ahead in your career often means pushing back against unreasonable demands and expectations. If you have a Boss who is piling it on and you are having trouble coming up for air you will need to push back. Start with your boss’s explicit needs, which usually break down to ‘make me money, save me money or make my life easier’. If you are doing these things well, you are going to be appreciated. However, your ability to handle a big workload may tempt the Boss to pile more on and run the risk of burning you out. If this is the case, make it a priority to open up the lines of communication with your Boss and find out what the real priorities are, and deliver on those. That way you can push back and delay work that is peripheral to your goal of getting ahead. Once you understand the real priorities you can go back and get agreement to reschedule the less important tasks. Recalibrate regularly with your Boss…have discussions to confirm you are on track to meet or exceed expectations.
How’s it Going?
The most common casual question you will get from a superior is… ‘How’s it going?’ The absolute best answer is…’Terrific’…even if it is not the case. Superiors do not want to hear negatives or long explanations of what going wrong…so don’t bother. The answer is always… ‘Terrific!’ Sounds too simple…but very few people do this.
Internet Usage and Emails
This one may seem obvious…but… be very careful with what you are viewing on the Internet. This stuff gets monitored by most large companies. When forwarding emails from your work computer be very, very careful…off color jokes and photos are a big no-no. Never-ever send a nasty email to a fellow employee even you feel they deserve it. This always turns out badly. With access to Facebook and all sorts of other social networking channels there are issues around corporate confidentiality and viruses bringing down networks and servers. Don’t send anything on corporate email or internet connection that you wouldn’t feel comfortable being published on the front page of the Wall Street Journal! Be very careful with Facebook etc and make sure not just anyone can view your pictures (drinking with friends). Lastly, beware of water cooler conversation. In every company there is always at least one person who loves to gossip. If you join that game it’s an easy trap and in which to be ensnared and difficult get out of.
Dress For Success
Many years ago a best selling book came out entitled ‘Dress For Success’ and I read it. The author did a study where he took photos of the same person wearing different suits and ties and showed each individual picture to different groups of 100 people. This provided a statistically valid sample. The results were amazing. People thought the guy in the photo wearing a dark blue suit, white shirt and maroon tie was twice as smart as the guy wearing a brown suit! As I read the book it became clear that what your wear can have a powerful impact on how others view you. Most of us do not wear suits to work anymore but I believe the concept remains intact. If you haven’t given any thought to how you dress…start right now! Save the weird outfits for the weekend. Additionally, watch how some the more successful senior executives are dressed. This is usually a good guide.
Public Speaking
There will be times when you will be called on to express yourself in front of a group or give a formal presentation. It is critical that you develop reasonable public speaking skills as they can rapidly push you up the ladder. There are different ways to become more competent speaker. I was always very nervous to speak publicly but overcame my fear by signing up for a presentation course, reading a few books on the subject and forcing myself to do it whenever I could. I found the more I spoke publicly the more confident I became. As you rise higher in the organization there will be more demands for you to speak in public …build this skill now!
Part II: Becoming a Manager
Once you have developed your technical skills (filling the tool box) you need to work on managerial skills (leading & managing others). The following section focuses on working at this next level.
From a ‘Doer’ to a Manager
During the first 3 to 5 years on the job you will become very good at executing, reviewing and follow-up. These skills have served you well and now is the time to move up into managing as opposed to executing. The four key elements of MANAGING are Planning, Organizing, Executing and Reviewing. The first letters in each of these names spell a meaningless word that looks like this …. POER. ‘Doers’ have jobs that look like this … POER (a big execution component, known as the big E). Managers have jobs that look like this … POER…much more focus on planning and organizing.
This will be your new look as you evolve into a manager. You will need to allow more time (capacity allocation) to Plan and Organize while allowing others to take the lead on executing. You will initially be tempted to jump into the ‘Doer trap’ (I.E., I know how to execute this… so I’ll stay until midnight to get it done).
If you start to do this, the worker bees will allow you to do their job for them and be happy to continue in this relationship. Don’t let this happen. Your new job is to Plan and Organize…not to execute the work of your subordinates. You will need to act like a manager.
Some suggestions… good managers block out 30 to 60 minutes at the start of each day or organize themselves. Mark this time on your calendar and don’t let yourself be disturbed. Use this time wisely. Don’t just drink coffee and read the newspaper. Write down what you need to get done that day, figure out how you will delegate the work and then hit the deck running. Excellent managers create space (time) by booking meetings with themselves to plan, organize and think. For example, if you have a big presentation to pull together, book several hours on your calendar during working hours. Don’t do it late at night. Superior time management is the hallmark of the best managers.
Managing Your Personal Capacity
In my work with executives, including CEO’s, I have regularly observed non-compliance to this concept. Assuming everyone has a weekly capacity of 100% it is essential to take some time to understand where you are investing your time. Many times I’ve found that 20 to 40% was being wasted on employee problems, reworking previously completed projects and numerous non-productive activities.
By simply redirecting their energy to more productive work they can free up time and be much more effective. The lesson learned is to regularly take a look at how you are using your personal capacity. Are you wasting it or focusing it? Sounds simple….but very few executives actually do this.
Managing Your Job Versus Managing Your Career
When I was about 30 years of age my Boss said ‘you’re doing a great job of managing your job but a terrible job of managing your career!’ Needless to say, I was surprised. He went on to explain that doing a great job is no guarantee of getting promoted. You also need to get noticed. He told me that at informal corporate gatherings I was sitting on the sideline and not engaging with senior leaders. Get out and talk with them. Tell them how much you enjoy working at the company. Tell them what you are working on. Give them a chance to get to know you. If you don’t do this…nobody else will!
Teamwork
Some thoughts on teamwork…. Teams usually get things done more efficiently and effectively than individuals; especially when the task is complex and cross-functional coordination is critical for success. While it is true that individual heroic effort can sometimes be very effective…it’s difficult to sustain over time.
However, when time is short and the task is simple, teams will not work as well as individual decisiveness. Also, as a manager, you do not want to encourage and reward individual effort at the expense of the team. You want the group to think ‘team first’.
Always complement the entire team for their work. You can single out one to two people individually for special praise, but it must be done in the context of the entire team. Never take personal credit for the work of a team. This is very important. Managers who take credit for the work of their subordinates are seen as losers. Managers quick to credit others are appreciated by everyone; particularly their direct reports.
Goals and Alignment
All the best mangers that I’ve worked with were goal oriented in their personal and professional lives. A person without personal goals is like a rudderless boat. If you have not written out some personal and work related goals you need to. Companies and departments also require well thought out goals.
As a new manager your job is to find the best way to align the goals of the company with the work of your team. Believe me you will save time while improving the outcome. It is a lot easier for team members to get excited about the team goals if they are invited to participate in setting them. Bringing down the ‘Tablets from the Mountain’ (i.e., the corporate goals) isn’t very motivating. Let your team help to set the goals and they will quickly align.
Begin With The End in Mind
Stephen Covey offered this succinct advice for any undertaking, for a day, a year or a lifetime in his book ‘7 Habits of Highly Effective People’. I always found it useful to imagine what the end game would look like before diving in. A powerful way to envision a goal!
Managing-Down
Managing-down is the opposite of managing-up. You need to ask yourself how you want to be perceived by those below you in the organization. The best advice I can give is to ‘be your self’. Ensure that you always maintain the trust and respect or the people you work with; ‘When in doubt…tell the Truth’. If you screw up…acknowledge it! There is nothing worse than listening to someone trying to cover up something with half-truths. Follow this rule and employees will respect, trust and support you.
Tough on Issues ..Soft on People
When a subordinate promises to do something hold them to it. If people are not delivering you need to call them on it. I always insisted that my subordinates did what they promised, but tended to soft on personal issues (e.g. sick children at home). A good style is to be ‘tough on issues—soft on people’. Lastly, be cautious about trying to be the best friend of each person who works for you. It’s natural to want to be loved but risky. As you ascend in an organization you will find that some people will always disagree with you and perhaps dislike you. Develop a thick skin.
Saving Lost Souls
You are only as good as the people you work with. Saving lost souls is time consuming and usually doesn’t work. It was not in my nature to fire people, but whenever I tried to save a lost soul it seemed to end badly. If you allow incompetence to exist within your direct reports you’ll have only yourself to blame when things go wrong. If you know a subordinate is weak, get rid of them and do it quickly.
The Assumption of Positive Intent (AOPI)
As a manager you will sometimes get angry with employees when they make poor decisions. Here’s some advice. Start by using the ‘assumption of positive intent’ (AOPI). Acknowledge that nobody comes to work each morning saying … ‘boy, I really hope I screw up today!’…that doesn’t make any sense.
If they are making poor choices it is usually for a reason. Your job is to find out what it is and fix it. Often they don’t have a clear understanding of what they are supposed to do, and sometimes that can be your fault. Sometimes they think someone else was supposed to do the work, instead of them. I found that stopping to consider this concept always slowed me down and I ended up making a better decision. By the way, AOPI works pretty well in personal relationships!
Assigning Ownership
Here’s a common mistake. Managers often will assign a project to a random group of several people and then wonder why nothing is getting done. The answer is simple…nobody is in charge. Always assign a job to an ‘owner’ (one person).
You’ve Got a BIG Megaphone
As a new manager, be aware of your power and how it affects those around you. Some time ago I arrived at a company as the new President. The company was in trouble and required a sense of urgency and focus. I met my executive assistant and casually mentioned that the drapes in my office were ugly. Several days later a decorator arrived to measure for new ones! Boy … did I ever feel dumb. This was not the message I wanted to send to all employees. I’m sure my assistant told her friends about the drapes and they must have thought I was an idiot.
My megaphone was a lot bigger than I had realized. People listen very closely to the boss. Additionally, as the boss you can bring energy to an organization with what you say…or…you can bring it way down. When employees ask you ‘how’re ya doing’…the answer is always ‘excellent…we’re getting better!’ Infectious enthusiasm is a lot more fun than the alternative. Use the megaphone wisely, it’s bigger than you may think it is.
Writing and Practicing a Script
I recently spoke with a newly promoted executive who was going to his first international meeting with other senior managers within his corporation. He was a little nervous and unsure of how to prepare. I suggested he write out a script of what he should say if the CEO came up to him and asked ‘how’s business’. He sat down and developed a narrative which concisely described the positive results and lessons learned during the past year. He then practiced what he intended to say with a friend to ensure he was comfortable.
Sure enough…the CEO approached him and said…’how are you doing?’ He was able to smoothly deliver the best possible answer and the CEO complimented him by saying… ‘you remind me of myself when I had your job! If you want to get ahead, be prepared to articulate your accomplishments in the most positive light.
Part III: Advanced Management Techniques
As you move up to the more senior level of management (Director, VP, General Manager, President, CEO) you will need to acquire new skills. Here are some that you won’t find in business school.
It’s All About Trust
I believe TRUST is the key characteristic of outstanding leaders. You do not have to be a ‘Rock Star’ to be a great leader. Many great leaders are the opposite of the Rock Star prototype. Jim Collins author of Good to Great spent time with many senior management teams while writing his book. Here’s what he said about the leaders of the best managed companies in the country.
‘We were surprised to discover the type of leadership required for turning a good company into a great one. Compared to high-profile leaders with big personalities the good-to great leaders seem to have come from Mars. Self-effacing, quiet, reserved, even shy—-these leaders are a paradoxical blend of personal humility and professional will. They are a lot more like Lincoln and Socrates than Patton or Caesar.’
What is TRUST? Simply put, trust means confidence. The opposite of trust – distrust—is suspicion. When you trust people, you have confidence in them. When you distrust people, you are suspicious of them—of their integrity, their agenda, and their capabilities. It’s that simple. We have all had experiences that validate the difference between relationships built on trust and those that are not. These experiences clearly tell us the difference is not small; it is dramatic.
We can all recall relationships with personal friends that are effortless. Communication is easy and quick. Debates are not arguments as you always consider your friends point of view as valid. You automatically trust each other; there is no stress. What would it be like if your business environment was like this? Wouldn’t it be easier to get things done?
During my first months as President of Pillsbury I discovered that we were offering larger trade spending packages to some customers and smaller ones to others. The sales organization offered several reasons why this as legal but I felt we should treat all customers equally and insisted that we change our approach and we did. I had several uncomfortable meetings with the customers who had been ‘overpaid’ over the last few years and were now being cut back. Some threatened to remove our brands from their shelves as punishment. I didn’t budge and they eventually backed down. As time went on, many people in the sales department thanked me for standing firm on this principle. They had all been uncomfortable when customers asked if they we receiving the same promotional package as other retailers. Standing firm on a principle is a good way to build trust. This is true in business and equally true in personal relationships.
Management Style
Throughout my career I have observed a style of management I could describe as…’Let’s hold their feet to the fire’ … (so we can get them to really perform!) We’ve all encountered people and organizations who use ‘fear, intimidation and coercion’ to get things done. The crazy thing is this style can work. It’s easy to implement and based on the idea … ‘I’m in charge and you’re not’! I believe 75% of organizations use some form of this way of working.
There is another far more powerful style that I would encourage you to consider. I like to call it ‘Team Based management’. It centers on the simple notion that openness, honesty and integrity coupled with an environment of trust allows everyone to perform at their absolute best. This only works if the management at the top (particularly the leader) believe in and insist on these principles (perhaps this is why I don’t see this style being used as much).
Furthermore, the very best leaders operate with a set of principles that they openly share with everyone in their organization. With day-to-day actions they continually answer the question…’what do I stand for as your leader?’ Great leaders have clear principles and live by them.
My principles were Openness, Honesty and Integrity. Communicating this way helped alleviate organizational fear while building an atmosphere of trust. Decide on your own principles and live them. When I first arrived at Pillsbury and spoke to all the employees and promised…’I will never tell you a lie…I will always tell you the truth’. Ironically this was a far bigger deal than I first realized. When I left Pillsbury many people came up to me and commented on my forthright honesty and how important this was to them. People respect consistency. People want their leaders to be good people who are honest, open and behave with integrity.
This little section is very important and I’d encourage you to read Stephen Covey’s book ‘Principle Centered Leadership’…it is outstanding.
Rope Theory
During my time as a CEO I often had as many as ten direct reports and found it difficult to devote time to them all. It was clear that some people required more attention than others. The more experienced and higher performing managers were usually fine on their own and came forward whenever a problem surfaced. I put this group on a long leash (rope) and told them why. This meant they would not meet as regularly with me and they were thrilled to have more elbow room.
The less experienced managers would be on short ropes (in some cases it was about 2 inches long!). I met with them regularly to ensure that we were on track. In each case, I explained why we needed to meet regularly and how I intended to support them as they worked through their issues. This simple concept of ‘Rope Theory’ helped me to manage many direct reports throughout my career. If you are managing a lot of people think about some on long ropes and others on short ones.
The 6,000 Mile Check-up
The purpose of the 6,000 mile (6 month) check-up is to create a platform for you to:- (1) Remind your Boss about all the good things you have done for him/her in your first 6 months on the job. (2) Raise any issues that you would like to talk about. The value of doing this is immeasurable. Your boss will be instantly reminded of all of your good work and forced to acknowledge it.
Be proactive and don’t wait for an annual review. Your Boss will love it because you are essentially writing your own performance review for him. I used this technique with my Boss when I first came to Minneapolis to head up the Pillsbury North American business’s (6 separate divisions). After 6 months on the job I was in the midst of transforming the entire organization from a ‘command and control’ entity to a ‘cross functional team’ based way of working.
When I outlined the complexity of this change in my ‘6,000 mile check-up’ memo, to my Boss, he finally recognized the full impact of this major change. Previously he had not fully understood why I was spending so much time on ‘organizational change’ as opposed to simply improving our slumping profits with some quick fixes…which is what my predecessors had tried to do. This was a big turning point in our relationship and he began to give me a little more time to turn the organization in a new direction. It worked out well.
Over the next four years we doubled profits from $240 million to $470 million and we couldn’t have done this without first changing the way we worked. By introducing the check-up letter I was able to become better aligned with my Boss.
As you move up in the world of management, this proactive check-up approach can also be effective with your direct reports. You can use your 6 month anniversary to request that they outline their accomplishments while surfacing things that they need to do to become better going forward. The opposite of this is to share your own review with subordinates. I shared my check-up at Pillsbury with my direct reports. They were surprised at my openness and, in turn, became more trusting and open with me.
Three Magic Questions
When I started a new job the first thing I did was to meet with small groups of employees (the people who do the real work). In my jobs at Pillsbury and Ocean Spray I met with over 200 folks in the first month…about 10 to 12 people in each meeting. During these sessions I asked three questions…(1) What’s working? (2) What’s not working (3) How can I help? At these meetings I mostly listened. By the time I was finished it was crystal clear what wasn’t working and what we needed to do to get it fixed. I then went back to all the employees and told them what they had said and what were going to do about it. Sounds simple…it is.
Relentless Focus on the Consumer
This one is very important and is part of what enables large consumer packaged goods companies to be so successful. As I have worked with other types of corporations I have been startled by the lack of focus on customers. As a leader of a large consumer food company, I stated every decision with the consumer in mind. Customer insights are the jewels that drive strategy. It is easy to become confused during a meeting when people are offering up sophisticated reasons why we should be doing something that doesn’t make sense. Always go back to the customer and ask yourself….would this make sense to our customer? You’ll be amazed at how smart you will appear!
Rules of Engagement
Over time I learned the importance of ‘Rules of Engagement’. While at Pillsbury we implemented some simple rules around how we wanted to behave as a management team. At that time we studied how Winston Churchill used what he called ‘Cabinet Responsibility’ during WW2. He insisted that the members of his cabinet respect the private discussions of the most senior members of the government and not share them with the press or their staff. It was a time of war and it worked.
At Pillsbury our management team agreed to have great roaring debates about which way to go. However, once decided, we all banded together in public support of our decision. It was not acceptable for one of our members to say…’yeah, that’s what they decided to do, but I personally disagreed during the meeting!’
When I first arrived in a new job I usually had one of management team break the ‘Rules of Engagement’ and I would inevitably hear about it. I’d then sit down with them and discuss how their lack of alignment had hurt the entire management team. They would be embarrassed and then fall into line. If you are on a team or lead one…read this again.
Conflict Can be Your Friend
Attaining alignment among your management team does not happen overnight or without conflict. There were times when we had heated arguments about a strategy. I always tried to create a safe place to try out ideas and encouraged intellectual curiosity. There is a greater chance of finding a breakthrough solution to the problem at hand when everyone feels safe. Conflict can be your friend…when all ideas are respected by each member of the team.
The Power of Simplicity
One of the most difficult challenges a CEO faces is finding a way to express corporate goals in an easily understood manner. Taking the time to polish and hone objectives into simple, telegraphic, and instantly accepted missives will be rewarded with organizational alignment. If you have three or four top corporate objectives, you will stand a better chance of recall than ten or twenty. Also, operating based on ‘principles as opposed to manuals’ and assuming that ‘conversations are more effective than emails’ will simplify the organization.
When you keep it simple you can avoid drift. In short, simplification should be your strategy. My CFO at Ocean Spray once smiled at me after I had delivered yet another employee speech and said….’Good talk…as usual, relentlessly boring …and boringly relentless!’ I laughed but took this as a compliment. He was noting that I was being consistent in my message. Whenever I join a new board I am continually surprised at how complicated they have made the business. Some of these companies have too many moving parts and an enormous number of objectives making it difficult maintain focus. Keep it simple.
Everyone Has a Vote and the Polls Never Close!
Gary Quinlan, an excellent corporate strategy consultant, once commented in one of my management meetings….”Sounds like everyone has a vote and the polls never close!’ This got a good laugh but it served to remind me that I was in charge and shouldn’t let a meeting get out of control. There is a big difference between productive debate and a free-for-all. Building consensus only works if there is someone in the room with the final say. If you’re the Boss, maintain control or you won’t have any.
Transformational Change
Truly changing an organization requires transforming an entity from what it is to what it can be. I have been involved in a number of corporate turnarounds. Looking back there is a distinct difference between crisis management and transformational change skills. Crisis management is all about triaging, stopping the bleeding and making decisions quickly and sometimes ruthlessly. Transformational change is different. It requires study and focusing on the big things; usually the big processes. For example, at Pillsbury we had 6 divisions and each one had their own set of internal processes resulting in a slow, duplicative way of working.
Once we identified all of the different processes in each division we were able to select a single process that would work best across the entire company. For example, we had many different methodologies for testing television commercials. By moving to one best practice we were able to simplify and save a substantial amount of money by going to one supplier. At the end of the first year we had identified over $30 million of annual savings by harmonizing multiple processes across the company.
At the same time we organized ourselves in a new way (cross functional teams) and became measurably quicker and lighter on our feet. Transformational change requires a different skill set which includes process management, corporate alignment organizational design.
Organizational Design
Here is an ultimate truth … ‘you get the results you deserve from the organizational design you accept’. Without exception I have observed organizational design flaws at every single company I’ve worked with. These flaws include inconsistent reporting relationships (e.g. marketing reporting to sales), functional silos with poor or no communication between the functional areas (e.g. marketing, sales, manufacturing, HR, etc.). This is the stuff that causes companies to grind to a halt. As a manager, you need to focus like a laser on organizational design….or you’ll get the results you deserve.
Innovation
Years ago I used to think of innovation in large terms. For example, inventing the microchip and creating the iPod. I now understand that innovation comes in all sizes and shapes. While at Pillsbury we expected, measured and celebrated innovation in all areas of the corporation. For example, our HR department continually found creative ways to manage rapidly rising health care costs. Our manufacturing team found creative ways to cut costs while maintaining quality.
At Ocean Spray our marketing folks designed a new plastic bottle, for our Cranberry Juice, that now fit in the side door of all refrigerators (a space saver and huge convenience). Sounds small, but it gave us a measurable advantage over the competitions and our sales shot up. The same group then came up with a new twist cap that only required 5 pounds of torque to open versus 15 pounds on all other caps. A big deal for our aged, arthritic consumers not strong enough to twist open the other bottles.
The same group then came in with a new idea…’White Cranberry Juice’. They pointed out that Welch’s White Grape Juice accounted for over half of their sales. Ocean Spray ‘White’ Cranberry Juice sales topped $100 million in the first year on the market! All of these are examples of small singles and doubles (versus home runs) but they enabled us to continually gain market share.
The message here is that innovation comes in small packages. These innovative ideas could have been introduced 5 or 10 years earlier, but it was this team that found them all within a two year period. Why? It was simply a matter of setting an expectation of continuous innovation.
As a manager, you need to expect your team(s) to continually innovate and then measure it. At the beginning of the year ask for a list of all the things they plan to test in the next 12 months and then continually follow up. Companies steeped in the innovation paradigm are making more money, continually taking waste out and building their brand(s) far faster than the competition. In short, they are the companies that are continually creating value for their consumers and shareholders.
Create a Burning Platform
Some time ago there was a terrible fire, in the middle of the night, on an oil platform in the Gulf of Mexico. The workers had virtually no time to react and some jumped into the gulf and survived while others stayed and died. Faced with possible death people will do unusual things. Creating a ‘burning platform’ can force action.
During my career I was involved in a number of turnarounds which required fast decisions without a lot of data. These situations were usually difficult for the Board of Directors to understand and deal with. An effective way to grab the attention of a board is to create a visual burning platform.
When I arrived at Ocean Spray the company had been losing market share for 6 years in a row and were sitting on nearly two years supply of cranberries and earnings were non existent. We had a lot of transformational work to do and I needed to move quickly. I talked directly to the board about where we were (they pretty much knew this already). I then painted a picture of what would happen to Ocean Spray if we didn’t take some very specific actions and it wasn’t pretty (a Burning Platform).
By the end of the meeting I had their agreement to move forward with a series of bold strokes. This was exactly what I wanted and needed. By painting a ‘Burning Platform’ I was able to create a crisis and get them to wave their slow bureaucratic decision making. After 3 years we delivered a net profit improvement of $118 million, debt reduction of $180 million and Cranberry beverage market share improvement from 48% to 53%. All of this was not entirely due to the Burning Platform, but without it….no turnaround.
Setting the Annual Corporate Financial Target
As a senior executive you will be involved in setting the annual financial target for the next year. During my career I had to deal with a Boss who always wanted to set goals that were unachievable. He would say ‘if you don’t stretch the organization you won’t get their very best’. He believed this and he was wrong. We would then get into a fight over the goal for the year. I always battled hard as I knew this target would predetermine how the organization would perform over the next 12 months.
When the goal’s too high…here’s what happens. If you are behind plan at the end of the first quarter the entire organization slows down and starts looking out the rear window of the car. Everyone goes into overdrive analyzing why we’re behind; supplying sophisticated analysis to the idiot who forced you into an unachievable target. What a waste of time! However, when you set a reasonable goal and are on or ahead of plan everybody looks through the front windshield and focus on ways to grow. Setting a reasonable annual goal is one of the most important events of the year. If possible, don’t get bullied into an unachievable target…the unintended consequences are substantial.
Don’t Over Steer
We all operate in a state of permanent white water. Organizations often become paralyzed, locked in relentless analysis and encircled by the fear of making a decision. If you can remove the fear and encourage the notion that being directionally correct is okay, everyone will move from intransigence to warp speed.
One caveat…if your decision turns out to be wrong (they sometimes do..), you must make a mid-air correction. Once everyone operates with the principles of ‘directionally correct’ and ‘mid-air correction’, innovation and speed will improve substantially. Do not underestimate the importance of this point.
Strategy First…Tactics Second
Taking the time to gain clarity around your strategies is a big deal. Too often, I have seen folks run off on tactical execution only to find that they have expended significant organizational capacity on the wrong thing. This is not to say that tactics are bad. High-performing companies continually test new ideas in their search for the overall winning strategy. Tactical tests can evolve into big strategies.
Look For Analogous Models
Solutions to problems often lie in other companies or even in what other industries are doing. Look for similar business models adjacent to your own. Often they will stimulate new thinking resulting in a breakout strategy. Also, benchmarking your business against the best-in-class is usually a scary – yet revealing – exercise.
While I was the CEO of the Select Comfort Corporation we were having a problem with timely response to consumer complaint calls into our call center. It took, on average, 18 minutes to speak with a representative! Not good. We put a cross functional team on this problem and they traveled out to the east coast to benchmark against Lands’ End a large internet/catalogue retailer. The team was flabbergasted to discover that their internal objective was to answer every customer call by the fourth ring! Lands’ End was very helpful in showing us some wonderful process improvements which got us down to a one minute hold time range. If they hadn’t benchmarked Lands’ End we would have been happy with a much smaller improvement in customer response.
Helping a Big Company Act Small
Put a cross functional team on a problem and they will solve it every time. A single person attacking the same problem may get it done, but it will take longer and the organizational buy-in will be much lower. If this is true, why not organize your entire company, or department into cross-functional business teams? This is exactly what we did at Pillsbury and Ocean Spray with impressive results. In both cases, we were able to have a big company act small becoming much quicker and lighter on our feet. If you feel ‘the need for speed’, a team-based organization will help.
Restless Dissatisfaction…Sense of Urgency
I love it when people appear to be dissatisfied even when we are doing extremely well. Healthy organizations are never entirely happy. The best test is to ask if things are better ‘today’ versus this time last year. If employees say… ‘of course things are better… but we need to fix this issue in front of us right now’… you’re on the right track. Restless dissatisfaction, accompanied by a sense of urgency, tell me we’re on track to get better.
Litigation Should Be The Last Resort
When I was at Pillsbury I was fortunate to have a very experienced and wise General Counsel or top lawyer. He continually advised me to avoid lawsuits (litigation) at all costs. Litigation is about as predictable as ‘Vegas’ luck (good judges, bad judges, good lawyers, bad lawyers, etc.) and the costs can be obscene. Good CEO’s should strive to avoid uncertainty and that’s what litigation offers. Mediation is usually a better cost effective venue to end a dispute.
The Annual Planning Slugfest
When I was a young Product Manager at General Mills I would spend 3 months every year pulling together the annual business plan for my brand (Cheerios). My team would work nights and weekends recreating the same charts from the previous year getting ready to present our plan to the multiple levels of superiors in a kind of ‘cage fight death match’. What a waste of time. During this 90 day period we were focused on being prepared to answer all questions about our plan and spent very little time in running the business.
When I became the CEO of Pillsbury Canada I changed this lengthy planning approach. Instead of compiling a huge planning book for each business I asked each brand manager to come in and sit down with myself and our CFO and bring 3 pieces of paper. (1) An historical Profit & Loss statement, (2) A single page that outlined the Objectives, Strategies & Tactics for the business, (3) A single page that listed the new strategic things we had learned from tests during the previous year and an outline of proposed tests we were planning to implement in the coming year. That’s it…3 pages! The meeting was purposely low key and informal as I wanted a discussion instead of a formal presentation.
Most strategies don’t change year to year so why not only review the few that you would like to adjust. You only change a winning strategy if you can make it better and you need to have some solid evidence to support the change. That’s worth discussing. I believe we reduced the prep time for annual planning to about a week versus 90 days; allowing the brand team more time to run the business. I truly believe ‘simplicity can be a strategy’.
Hubris
What is it? How do people get it? Could I get it? A good definition of Hubris goes like this… ‘being out of touch with reality and overestimating one’s own competence or capabilities, especially for people in positions of power.’ Said another way…’pride comes before a fall’. I clearly recall flying into New York by myself on a Pillsbury corporate jet and being picked up by a limo. On the way into Manhattan I began to say to myself…’Wow..I must be really smart or I wouldn’t be riding around on my own jet’. Whoo…fortunately I quickly got a grip on myself! This was the beginning of hubris…an overestimating of my abilities.
During my career I have encountered a number of senior executives with a severe case of hubris. It’s easy to do. I found them to be insufferable, ineffective and unable to clearly consider ideas beyond their own. Their people hated them and they never seemed to run a team based organization. They always got fired. This is a disease you do not want to catch. Be careful.
– Robert Hawthorne