Creating A Successful Change Initiative

Ask the Expert: Creating A Successful Change Initiative
By Nina Coil

Question: I am an HR manager in a Fortune 500 company, and I have been tasked with implementing a new performance management process – the latest in a series of changes that we have had to adapt to and roll out after a merger late last year. I am getting the sense that my team is a little burned out and I wonder about their ability to enthusiastically get behind this latest change. What suggestions do you have?

Response: First, you are not alone – both in the sense of feeling that you and your team are facing non-stop change, and that you are having to lead a rather burned out team in endless implementation. Mergers, more than many other change initiatives, are not an event but a journey, and it is very common for the changes associated with them to take far longer, and be more complicated, than anyone could have predicted. Even the best-planned changes require adaptations as time goes on – changing one part of a system creates ripple effects that must be dealt with.

Mergers and acquisitions are very, very hard to accomplish. Only 30% of change initiatives are implemented successfully. Most of us have heard this statistic – it is based on research by Michael Hammer and Jim Champy for their book Reengineering the Corporation. But more specific research into the success rates of culture change, which are at the heart of an M&A initiative, shows that the 30% figure is too high. Culture change is considerably more difficult than strategy deployment or restructuring, with a more accurate success rate closer to 19%. Meaning that culture change (usually a critical part of an M&A), has only a 20% rate of success – nearly 80 % of these initiatives fail.1

Consider just one variable that often goes unspoken in a merger – the “winners” and “losers” in the process. Most senior leadership teams take great pains to stress that mergers are the synergistic combination of equals. But we all know that this is simply not true. In a merger both “sides” are usually well aware who is the “winner” and who the “loser.” This does not mean that certain individuals or even departments within the “losing” organization may not eventually flourish in the new entity, but rather that the burden of undergoing the change is usually placed more on one organization and its members than the other.

There are obviously attractive aspects of the firm being “merged” or it would not have been a target – in fact, acquired firms are often looking for suitors. But it is rare for the “winner” in a merger, as well as the “winner’s” staff, to fully appreciate, much less name, even less help the “loser” with what is being lost. The “loser” is expected to be grateful for the chance to succeed in the newly merged entity – for the lifeline to viability. And they may eventually be glad to be part of the merged entity. But for this to take root takes much more time and a different kind of support than is usually provided.

If the performance management system you are talking about is the latest of the “winner’s” ideas it will be that much harder to get people who were with the acquired company to go along with it. In many ways they may feel like they have no energy left to face this next challenge, and your staff, who has to convince them otherwise, may realize just how much of an uphill battle this is likely to be.

Furthermore, undergoing deep change actually hurts. That is, research into brain function shows that having to make all the conscious choices associated with non-stop and major change requires what constitutes a painful level of involvement of primitive parts of the brain2. Our brains are much less stressed when we can operate much more automatically, not having to consciously consider the choices we face day after day, hour by hour. It is exhausting to do so – ask anyone who has moved to a very different location, preferably with a different language to contend with, just how tiring this is. This is true whether or not the decision to move was their own or someone else’s. Consciously making choices over and over again in an environment of non-stop change causes repeated stress and emotional drain, not to mention the extremes of physical symptoms like illness or accidents.

Deep change (like the merging of two different corporate cultures) is very, very difficult to achieve. In fact, studies of coronary bypass surgery patients have shown that people would – literally – rather die than change.3 So well-intentioned and well-designed changes at work – mergers, acquisitions, downsizing, new systems – are up against some very basic human reactions that make the process lengthy and difficult, even when they are so very clearly “the right thing to do.” If a person who is facing certain death can’t make changing their eating habits stick, why do we expect that our employees will be able to quickly change the assumptions – the paradigms – they have built their work around?

Here is my advice. What you have been doing has kept your team going until now. But perhaps it is time for a real change in your approach. To get different results do something radically different – stop talking. Chances are that you and your team have all been talking, for what seems like years now, about all of these changes. If you are not seeing new results from just talking – using words, whether just aloud or captured on flipcharts or in meeting minutes – try something really different. Try building or creating something together – literally – and build trust and deeper understanding of one another in the process.

As humans we are “built” to tell stories. We tell the story of our lives, in appropriately focused chapters, - until the day our life ends and our story is “complete.” In fact, when Howard Gardner4 looked at how to change people’s minds as a leader during times of change he found clear evidence that story-telling is key. In addition, he says that “mind change entails the alteration of mental representations.” This is accomplished through the medium of stories – for a large audience, simple stories work best – for a smaller audience of individuals who share knowledge and expertise, the stories or theories can and should be more sophisticated – customized, as it were. And this is true above all of a team like yours in HR, which can be assumed to share common values and assumptions related to their work.

When faced with a major change, people need to be able to tell a very different story about who they are, what they know, and for and with whom. When the “story line” has radically changed – we work for a new organization, the organization has radically changed its focus, our roles have changed significantly – people can find it hard to build a coherent story, at least until they have really gotten accustomed to the new state. It can be helpful to see “the story” as something temporarily outside themselves – as something that is not just the usual stream of conversation in their own heads that they share, in pretty much the same way, with everyone they talk to about what is going on. There are ways to go about building stories that are both deep and broad in their impact.

Years of research and newly evolving brain science support the value of creating a physical framework on which to project something we do not yet have words for, or that are less than concrete5. Words like “team,” “value,” “goal” are used in daily corporate communication but what they really mean is open to wide interpretation. Getting clear on the abstract is particularly useful in times when our “stories” need to shift at a deep level. Given time we may all eventually “get there,” but the process can be supported, enhanced, and speeded up if you take a little time and “work the process.”

Metaphors are particularly helpful in deep change and to build new stories. They can serve as the gateways to different levels of understanding and perspectives. Using metaphors can enable you to construct something – literally – outside of yourself onto which you can project a story. A process that uses your kinesthetic sense can help you tap into subconscious creativity that gets suppressed in times of stress. Working kinesthetically can also help to break free of typical “meeting dynamics” when one or two people (adept wordsmiths or extreme extraverts) tend to dominate, while others get only a few words in edgewise.

Two ways to try this are using collage work (any number of standard variations can be found on the web) and kinesthetic and experiential approaches like LEGO Serious Play (LSP). Linkage has developed a synthesis of LSP methodology and our change management tools to guide a team through coming to terms with a deep change. The process uses kinesthetic and metaphorical approaches, supported by more traditional analytical tools, for a holistic and revolutionary way to build team trust and enable change.

Your team is working valiantly to come to terms with a series of major changes, and to take responsibility for their implementation. The changes themselves have probably been well thought-out and carefully planned. But even in organizations where that is the case – where every known contingency has been built into the plan – there are simply too many variables in a change as large as a merger, and the stakes for everyone are too high, to be able to predict exactly what will happen when.

Create a context within which your team can bring their whole selves – body, mind, heart – to bear on co-creating a compelling set of team norms, deeper understanding and appreciation of one another as individuals, and a clearer picture of what has been and will be changing in their workplace. This will go a long way toward re-energizing your team – it will help them build a new team story that will guide and motivate them for the challenges ahead. The more you enable them to prepare to deal with the new situation, the more smoothly they will be to move through their adjustment and help others in turn.


1 Martin E. Smith, PhD. “Success Rates for Different Types of Organizational Change” Performance Improvement • Volume 41, Number 1, January 2002.

2 Koch, Christopher. “Why Change is Painful,” CIO Magazine, September 15, 2006, citing research by Jeffrey M. Schwartz, research psychiatrist at the School of Medicine at the University of California at Los Angeles.

3 Change or Die, Fast Company, May 2005, Alan Deutschman, research by Dr. Edward Miler, CEO of Johns Hopkins University.

4 Gardner, Howard. Changing Minds: The Art and Science of Changing Our Own and Other People’s Minds. Cambridge: HBS Press 2006.

5 Dennett, Daniel. Conversations on Consciousness, Oxford: Oxford University Press, 2005

From Tactical to Strategic:

From Tactical to Strategic:
The Evolution of the Performance Management System
By Michael George

In the world of marketing the “value proposition” is made up of the total benefits which the vendor promises the customer will receive in return for the customer’s payment. In simple terms the value proposition is simply what the customer gets for what the customer pays. Marketers often spend hundreds of hours honing their product’s value proposition to formulate a single key message that hits home with buyers and causes them to act. Often the value proposition is relative to the target customer and a single product or service may have different relative values to different users of the product.

So what does this brief marketing lesson have to do with talent management, and specifically enterprise performance management software? To better understand the evolution of performance management software (and understand the future) one simply has to look at the changing “why-to-buy” messages (that used to be printed on a box, but software boxes no longer exist). Over the past ten years there has been a recognized shift in the HR field from tactical to strategic. Call it “a seat at the table” or participating in driving the business objectives through a people strategy, or any other name, HR has increasingly become responsible for the quality of the workforce – which is most often determined by measuring employee performance.

As HR’s focus has changed, so has the value of enterprise performance management software. The first performance management applications were designed, built and sold to HR for the purpose of improving the performance review writing process itself. The value messages centered on process improvement and lower administration costs, and applications of the era delivered. The value proposition was HR could more inexpensively manage the process of completing performance reviews through automation – benefitting the company’s bottom line – and that was good.

As organizations began to more efficiently manage the performance management process, they started pressing vendors to provide functionality to help improve the quality of the performance review, and make the task easier for managers (review writing was always portrayed as a grueling task for managers). Vendors began adding competency content, and a host of feedback mechanisms to enhance the quality of the review itself. However, in order for HR to receive budget to purchase the software, the value proposition was caged as better reviews meant fewer transactions between managers and HR further benefiting the company’s bottom line – and that was better (but still focusing on the value to the company).

However, getting high-quality reviews done more quickly didn’t seem to inspire those managers to rally behind performance management software and many organizations faced significant resistance to using the software. Why? There value proposition didn’t speak to what was important to managers (of course they care about the company’s bottom line, but the direct benefits to managers were not well communicated). To remedy that, the next generation of performance management software added a significant number of tools specifically designed to help supervisors be more successful in managing the day-to-day performance of their employees. Specifically, features to track daily activities and support coaching and mentoring were added to increase the value of the software to, oddly enough; those that were being asked to use it on a regular basis to better perform their management function. This new value proposition was significantly different than its original cost reducing, process improving predecessor. The biggest value (or reason to buy performance management software) was no longer to improve the process, but rather improve the relationship between the manager and the employee. This is when performance management software became performance management systems. For years, HR has lived by the credo that employees don’t leave their company they leave their manager, and now they finally have a system to measure and influence the quality of that relationship.
The next generation of enterprise systems is now beginning to focus the value proposition on the employees. Without question managers have become more attentive to (and skilled in) improving employee performance by encouraging learning and developing opportunities, but no group is more motivated to enhance their careers than the employees themselves. The market has responded with a new generation of performance management applications that offer a rich, interactive environment to address career and succession planning, workforce mobility, and a host of other tools designed to bring unprecedented transparency and ownership of the performance management and career development process to the employees. No longer is the “employee file” kept in a top secret filing cabinet behind the walls of the HR office.
Employees today have access to historical performance data, peer and manager evaluations, learning and development opportunities, succession plans, career path tools, and dozens of other features that have been developed and delivered with the sole purpose of engaging the employee in a meaningful way. Organizations have recognized that their top talent is going to leave for a better opportunity; so they might as well be the one’s offering it.

The value proposition is now that of quality, not quantity, investment in talent rather than reducing expenses, and performance reviews are fast becoming something employees and managers look forward to rather than dread. When the conversation is driven by the employee and centers around maximizing their contribution to the organization, excelling in their role and engaging with the company at new depths, managers stop fearing the review and start creating superstars. And when those conversations are happening weekly instead of annually, employees begin to develop a deep and positive relationship with their manager and the company they work for.

Today, the value proposition for using a performance management system is that it can show employees how their unique contributions are truly valued by both their manager and the organization and helps employees to connect real meaning to the work they do each and every day. The target customer is no longer HR, it is the employee – and that is very, very good.

Innovation Creates Industry Change

Innovation Creates Industry Change
By Clayton Christensen

Excerpt from Disruption Drives Growth: Ten Years After ‘The Innovator’s Dilemma’ Strategy & Innovation Newsletter, Volume 5, Number 3

Ten years ago, I published The Innovator’s Dilemma to explain how the very management principles that companies have learned to rely on actually can inhibit their ability to successfully master disruptive change. In industry after industry, my research has shown that disruptive forces can overwhelm even seemingly unassailable market leaders.

In this article, we take a look at a five of the biggest disruptors that have emerged in the decade since the term “disruptive innovation” first entered the business lexicon. These companies have been able to identify important, unsatisfied jobs that customers were trying to get done, create innovative new solutions to satisfy these jobs, and successfully commercialize these opportunities with innovative new business models.

1997: NetFlix develops a new model for home-video delivery
NetFlix’s online-rental and mail-delivery service changed the way millions of people watch home entertainment. Netflix did away with costly late fees on overdue movies, targeting one of the core profit drivers for brick-and-mortar retailers such as Blockbuster.

The company’s innovative business model was initially unattractive to the likes of Blockbuster, which not only was unwilling to give up its lucrative late fees but also was unable to leverage its existing real-estate assets to create a meaningful response. A similar subscription based service would have done nothing to boost the incumbent’s key metrics, such as sales-per-square-foot. At first, NetFlix basically solved a rather simple job: People were sick of going to a video-rental store on a weekend night only to find that they couldn’t get the movie they wanted. The company continued to improve its service, developing a sophisticated recommendation system that suggests alternative selections based on subscribers’ viewing history. With no retail presence and over $1 billion in sales, Netflix has had a real impact on the industry. Since the company went public in 2002, its stock has increased by more than 165 percent, while Blockbuster’s has fallen by 78 percent. Importantly, based on numerous statements by CEO Reed Hastings, the company realizes that further disruption in the media industry is forthcoming and understands it cannot glide along on past successes. NetFlix plans to leverage its predictive recommendation technology and devoted user base to move into the next big disruptive service—digital content delivery.

1998: Google creates new models for direct advertising
Sergey Brin and Larry Page set out “to organize the world’s information and make it universally accessible and useful” and, in the process, created one of the world’s most successful technology companies. Google had early success with its search engine, which quickly became the most popular on the web. In those early days, Google was a technology looking for a business model. As has become a company hallmark, Google began experimenting with a vast array of new products and services. Two years after its launch, Google began selling advertisements alongside its search results.

Instead of using simple banner ads that were common at the time, Google developed a system that allowed companies to bid for ad space based on the keywords being
searched. The service, named AdWords, let advertisers more effectively leverage their ad dollars. The company’s “pay-per-view” and “pay-per-click” services give marketers instant feedback and is largely responsible for pulling ad dollars away from traditional players, such as print media. Additionally, Google made it simple and economical for small companies to place highly effective advertisements. When Google went public in 2004, it raised $1.67 billion. Today, less than 10 years after its founding, the company’s market capitalization exceeds $160 billion. And with its mission of “organizing the world’s information,” Google still has ample room for growth.

2000: MinuteClinic creates a new way of delivering healthcare services
From the start, MinuteClinic’s low-cost healthcare clinics were highly disruptive. The company placed its kiosk-based services in convenient locations, such as drug stores and supermarkets, allowing consumption of healthcare in entirely new contexts. Performing a disruptive “triple-play,” the company also reduced the cost of certain medical services and made the simple diagnosis of a number of common conditions more convenient. At a MinuteClinic location, licensed practitioners diagnose common illnesses using a set of rules-based procedures to quickly guide them through the examination and testing process. The practitioners then quickly deliver prescriptions, which often can be filled at an onsite pharmacy. Unlike with a primary care physician, appointments are not needed and wait times are significantly reduced. With operations and displays modeled after McDonald’s, including a menu of available services, the firm’s goal is to treat patients in no more than 15 minutes. Its slogan—“You’re sick. We’re quick.”—is prominently displayed at all of its locations. The company not only is easy for consumers. It also is attractive to others in the notoriously complex healthcare value chain. By reducing the cost of treating an assortment of the most common maladies, insurers were relatively quick to embrace MinuteClinic’s innovative new offering. CVS/Caremark acquired the company in 2006 for a reported $170 million.

2002: IRobot’s Roomba cleans up the vacuum market
iRobot, founded by three people who had worked in the Massachusetts Institute of Technology’s Artificial Intelligence Lab, got its start developing complex, one-off robots that, while technically stunning, were not profitable. Although engineers resisted the move, the company made the strategic decision to move into the mass market by producing a robotic vacuum, dubbed Roomba. The product allowed busy people to stop doing the timeconsuming and unpleasant task of vacuuming floors. The product was a major success for the small company. iRobot’s invention optimized the vacuum cleaner entirely on convenience. Roomba requires no work and can clean hard-to-reach places, like under tables and beds. iRobot has sold more than two million Roombas and is growing quickly. In 2006, year-over-year revenues surged more than 30 percent to close to $200 million. The company has also moved up market, tackling more complex jobs. Its Scooba robot washes floors and its Dirt-Dog robot can pick up items like nuts and bolts from a workshop floor. Interestingly, iRobot has not abandoned its original mission of developing world-class robots for complex jobs. It still works with military and corporate clients to develop custom solutions, but its disruptive business affords it the profitability to play in this space, offering the hope of future growth in new areas.

2003: MySpace.com delivers the right solution at the right time
When Tom Anderson and Chris DeWolfe created MySpace, it was not the first social networking site on the web. At the time, a competing site, Friendster, was a popular place for teens to create online profiles and connect with one another. But MySpace largely captured social networking by creating a holistic solution that nailed the job customers were trying to get done. In many ways, the story is similar to Apple’s success with the iPod. When the iPod came to market it was far from the first MP3 player. In 1997, SaeHan Information Systems launched the MPMan F10, the world’s first MP3 player. A number of other solutions came out in the following years from companies such as Diamond Multimedia and iriver. But many of the devices were clunky, hard to use, and had poor sound quality. Apple’s launch of its sleek, intuitive iPod transformed the category. But people forget that the iPod was not an overnight success.

It took the creation of the iTunes music store and several product generations before the product became a “must have.” It took the iPod more than three years to break
through $1 billion in revenues. (For more on this, see the chart on page 9.) MySpace similarly developed an easy-to-use site that helped people quickly set up a home page and made posting events, playing games, listening to music, and socializing with other users simple and convenient. The company’s solution nailed the job and consumers flocked to the site. The company’s central role in connecting its users is a model that cannot be easily replicated by incumbents such as newspapers, television stations, magazines, and movie theaters. Having grown its user base rapidly, in 2005, News Corp purchased MySpace’s parent company, Intermix, for $580 million. Currently, MySpace’s revenues are estimated to be $360 million and are forecasted to double by early 2008.

In industry after industry, companies have created growth by following – explicitly or implicitly – the patterns of disruptive innovation. Disruptors create growth by redefining performance. They either bring a simple, cheap solution to the low end of an established market, or enable “nonconsumers” to solve pressing problems. Disruptive innovations have reshaped numerous industries and created tremendous consumer welfare and corporate profits.

Thrive In Tough Times:

Thrive In Tough Times: 11 Simple Steps You Can Take
To Fortify Your Company For The Long Road Ahead
By Quint Studer

No question about it: being a leader is tough these days. You can’t turn on the television, open a paper or sign onto the Internet without being pummeled by a daily dose of economic bad news. It’s disheartening, to say the least. No matter how strongly you believe in your company—and in your own ability to guide it through the rocky shoals lurking up ahead—you can’t help worrying a little.

Good news. There is something you can do to fortify your company for the future. Quite simply, you must create and nurture an organizational culture that develops great leaders today and instills the mechanisms and the mindset that will continue to foster great leadership tomorrow.

Great leadership is everything. All other elements of success flow from it. Companies with mediocre leadership can skate by when the economy is booming, but in tough times they really suffer. Your leadership must be top-notch. If it isn’t, you may not be around five years from now. If it is, your chances of surviving—and yes, thriving—escalate dramatically.

Of course, creating a culture of sustainable leadership doesn’t happen overnight. But there are some steps you can take right now that will yield quick wins and get your organization on the right path. Here are eleven of the most important:

1. Sit down with senior-level management and create a get-through-the-recession plan. Go through your business plan with a fine-toothed comb. Does it still make sense? Do you see any holes? Figure out which objectives you are meeting, which ones need more emphasis, and which ones you should re-think. Make sure goals are aligned across every part of your company, that everyone is “singing from the same choir book.”

At the same time, scrutinize your expenses and cut anything that’s not absolutely necessary. And, communicate your plan to all employees. If your front-line employees don’t know you have a get-through-the-recession plan, you don’t have a get-through-the-recession plan. Everyone needs to understand the plan and buy in to it.

2. Get your whole company started on a “candy coat” diet. In other words, quit candy coating the truth, no matter how scary it seems. Address the tough issues with straight talk and transparency and make sure your leaders do the same. Chronic secretive behavior and lots of behind-closed-door meetings harm morale in any economy. Rumor and gossip thrive in a vacuum. But when you’re making changes in response to an economic downturn, transparency is especially important.

If employees can tell you are hiding something—and 9 times out of 10 they can—they’ll assume the worst. They know tough times are at hand and they probably lie awake worrying, too.

3. Put words in your supervisors’ mouths. Employees will ask questions. Your leaders need to know how to answer them. Let’s say Worker Walt approaches Manager Mike to ask if the rumor he heard—that the Duluth division is on the verge of closing down—is true. Mike responds with a deer-in-the-headlights stare and a vague stammered comment that the company is doing its best to avoid any closings. (He knows the Duluth shut-down is off the table, but isn’t sure how much he’s empowered to say.) Walt draws his own (grim) conclusions and starts spreading “the bad news.” The rumor mill kicks up a notch and morale plummets.

To avoid such scenarios, train managers on exactly what to say regarding timely issues—and how to say it. Be very specific. In the scenario above, Mike didn’t say anything that wasn’t true. He just failed to say it clearly, concisely, and confidently. You can prevent these kinds of misunderstandings by telling managers exactly what to say when employees ask questions about the company’s future. Write a ‘script’ of sorts so that everyone is speaking in the same voice.
4. Nix the negative self-talk. Okay, leaders, truth time: Do you sit around chewing your nails and dreaming up terrible scenarios? What if our biggest customer pulls out? What if the market for our services dries up? If this sounds like you, stop it right now. When you exist in a constant state of worry, your state of mind infects everyone. And besides, 99 percent of the disasters you agonize over probably won’t come to fruition.

I like to cite the acronym FEAR: Fantasized Experiences Appearing Real. It’s true. We sit around and conjure up all these awful scenarios and then wonder why we can’t move forward.

5. Don’t permit fear to get a foothold. One of my favorite phrases is What you permit, you promote. When you allow free-floating anxiety to permeate your company, you’re basically giving it your stamp of approval. If an employee expresses worry about the bad economy, don’t just clap her on the shoulder and say, “Yeah, I know it’s rough; hang in there!” That lends credibility to her anxiety and indicates that you share it.

A better solution would be to say to her, “Tell me what you’re struggling with today.” In other words, get specific. Engage the worried employee. Ask, “What can we do to help you?” Often, the simple act of vocalizing fear helps defuse it. And encouraging employees to do so gives leaders the opportunity to reinforce the company’s strategy.

6. Give low performers the old heave-ho. Low performers suck up a disproportionate amount of managers’ time, tick off customers, squash morale, and drive away high performers. When business was booming, you may well have let their bad behavior slide. Now, the day of reckoning is here. You should be spending 92 percent of your time with high and middle performers and only 8 percent with the people who don’t really want to be there—and if you’re not, you must take steps to remedy that now. (In Results That Last, I outline a plan for doing just that.)

You can’t afford to alienate your customers; you can’t afford to neglect your middle performers; you certainly can’t afford to lose your superstars. In short, you can’t afford to keep your low performers any longer. Period.

7. Make your company a place top performers want to be. (Raises not required!) In an uncertain economy, it would be disastrous to lose your best employees. But at the same time, it may be unrealistic to pony up a big raise right now. That’s okay. You can offer your people perks that don’t cost the company a lot of money.

Think about ways you can make their lives easier—flex time, partial work-from-home schedules (much appreciated in these times of exorbitant gas prices), access to a “chore runner”—and implement them. Many of your employees may not have the first clue about sound financial strategies. You might give them access to the company’s CPA or financial planner, who can advise them on better bank accounts, IRAs, college funds, debt repayment, and more. So even if you can’t provide bigger paychecks, you can help them manage their expenses a little better.

8. Put your best face forward with a Standards of Behavior contract. How should employees answer the phone? Steer clear of controversial topics like politics and religion? You may never have given serious consideration to such questions, but you should. I regularly advise my clients to create a Standards of Behavior contract that employees help craft, then sign.

The idea is to create the best possible company, a place where employees can do their best possible work and customers can get the best possible service. These contracts ensure that everyone consistently has a great experience with your company. That’s always important, but in economic hard times it’s absolutely critical.


9. Padlock the ivory tower. Right now, more than ever, employees need you to walk among them. One way to make a real, daily connection with employees—and I don’t mean empty face time—is to practice “rounding for outcomes.” In the same way that a doctor makes rounds to check on patients, a leader makes rounds to check on employees. The technique allows you and your managers to regularly touch base with employees, make personal connections, recognize success, find out what’s going well, and determine where improvements are needed.

Rounding helps you build a strong emotional bank account with employees. Mind you, that’s always important, but it’s especially critical in a down economy. When you need to rally the troops, they have to know you care. Troops who don’t think you care can’t be rallied. They might even desert.

10. Always manage up your organization. A recession (or downturn if you’re not willing to use the R-word) is simply a national confidence problem, usually exacerbated by lots of negative talk. The same dynamic exists in your own sphere of business. That’s why you should say only great things about your company and its staff, whether you’re talking to outsiders, clients, or employees themselves. Insist that your employees do the same. I call this “managing up”—i.e., accentuating the positive—and have found that it’s a valuable confidence-building tool that keeps employees content and customers coming back.

11. Shine a 1,000-watt spotlight on customer service. Okay, this one may seem obvious, but it can’t be said too often. When pressure to stay competitive is at an all-time high, you must be absolutely certain your customers are getting what they want and need from your company. Don’t assume that just because they’re not complaining, they’re happy. Start asking each customer exactly what her expectations are, document them on an individual preference card, and make sure all employees who come in contact with her get a copy.

Never presume you know what’s important to a customer. Always ask. Individualized customer service is more critical now than ever. In the Globalization Age, it’s the only way you can differentiate yourselves from your competitors. So don’t look at it as merely a way to hang on to your customers until you get through the downturn—look at it as the new normal for your company.

There is a very big positive that comes out of downturns. It sharpens our survival instincts and shows us what we’re really made of. Instead of just coasting along on the wave of an economic boom, we’re forced to get focused and get serious. And for many companies, the pressing need to “turn it up a notch” kick-starts a journey of transformation.
The great news is that out of difficulty, heroes rise. There is plenty of opportunity out there even now—especially now. Someone is going to seize that opportunity, gather up the customers others aren’t taking care of, and invent new ways to corner new markets. That someone might as well be you.

Quint Studer not only teaches it, he has done it. After leading organizations to breakthrough results, Quint formed Studer Group®, an outcomes firm that implements evidence-based leadership systems that help clients attain and sustain outstanding results. He was named one of the “Top 100 Most Powerful People in Healthcare” by Modern Healthcare magazine for his work on institutional healthcare improvement. Studer was named “Master of Business” by Inc. magazine. He is the author of BusinessWeek bestseller Hardwiring Excellence: Purpose, Worthwhile Work, Making a Difference; 101 Answers to Questions Leaders Ask; and Wall Street Journal bestseller Results That Last: Hardwiring Behaviors That Will Take Your Company to the Top. For more information, visit www.studergroup.com or www.resultsthatlast.com.

Results That Last: Hardwiring Behaviors That Will Take Your Company to the Top (Wiley, October 2007, ISBN: 978-0-471-75729-0, $24.95) is available at bookstores nationwide, major online booksellers, or directly from the publisher by calling 800-225-5945. In Canada, call 800-567-4797. Copies also can be purchased online through the Studer Group website at www.studergroup.com.

Simple Tools to Facilitate Planning for People

Simple Tools to Facilitate Planning for People
By William J. Rothwell, Ph.D., SPHR

Human resource (HR) management practitioners and workplace learning and performance (WLP) practitioners in many organizations are heeding the calls of organizational leaders to coordinate planning to prepare for possible losses of highly talented people to retirement, death, or disability. At the same time that unemployment rates in the U.S. are on the increase due to a general business downturn, organizational leaders are concerned about how to replace key people or key positions as Baby Boomers prepare for retirement. Many HR and WLP practitioners are looking for ways to expedite replacement planning, management succession planning, knowledge transfer from more to less experienced workers, and social contact transfer from more to less socially well-connected workers. As they do so, many throw up their hands and express frustration that it will take too long, and be too complicated, to do.

But what is replacement planning, and what tool can make it easier to do? What is management succession planning, and what tool can make it easier to do? What is technical succession planning, and what tool can make it easier to do? And, finally, what is social relationship succession planning, and what tool can make it easier to do? This short article addresses these questions.

What Is Replacement Planning, and What Tool Can Make It Easier?
Replacement planning is sometimes confused with management succession planning, though they are quite different. Replacement planning assumes that the organization chart will remain unchanged, and it seeks backups from within the organization—and often within the same division or department—for each key position. Back ups are chosen on the basis of which individuals are best equipped to take the place of their immediate supervisors, if only on a short-term basis while a thorough internal and external search is conducted to identify the most qualified person to fill a vacancy.

The simple tool shown in Exhibit 1 can be used to facilitate replacement planning. Starting at the top of the organization, replacement charts can be prepared for each group. A replacement chart can thus be prepared for CEO and his or her immediate reports. The replacement charts can then be cascaded as far down the organization as leaders wish to go.

“Rank” refers to a listing of most qualified people, with rank = 1 signifying the most qualified internal candidate. “Name” of course refers to the name of the person, and “readiness” indicates how well prepared an individual is to assume higher-level responsibility. Readiness is usually rated as RN (ready now), R1 (ready in up to 6 months with proper coaching and development), and R2 (ready in up to 1 year with proper coaching and development).
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Of course, replacement planning is far from ideal. It leaves to managers the chore of identifying their own replacements, and that is why these confidential charts are usually reviewed by all managers at one level and their immediate supervisor to validate them. Still, replacement charts are imperfect solutions because the criteria used to determine promotability are left up to each manager. But they are better than nothing, and they do launch conversations about what talent exists in case of emergency and how much bench strength the organization actually has.

What Is Management Succession Planning, and What Tool Can Make It Easier?
Management succession planning focuses on identifying leaders for each organizational unit. Its key focus is thus the manager of each level of the organization, starting at the top with the CEO and extending as far down the organization chart as organizational leaders wish to go. But, as Exhibit 2 illustrates, the goal is not to identify individuals as immediate replacements for each position but rather to plan for a talent pool by level. Managers may, for instance, nominate individuals to be considered for the next level. They are then placed in a pool and are systematically developed for greater responsibility. But they are being prepared for any position at the next level above them--not specific positions. Typical goals of a talent pool are to have as many people as possible in the pool and to reach an 80 percent level of readiness for advancement to the next level. Once individuals are promoted, they are given the final 20 percent while in their new positions.
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Managers have to work together to identify candidates for inclusion in the talent pool. If there is a risk of losing a high percentage of individuals in the targeted higher-level group, then the development of HiPos (High Potentials) in the talent pool is accelerated. In that case, the talent pool is called an acceleration pool to indicate an effort to increase the speed of preparing individuals in the pool for promotion.

What Is Technical Succession Planning, and What Tool Can Make It Easier?
When experienced people retire or otherwise leave an organization to resignation, death or disability, they take with them special knowledge. That knowledge takes two forms. One form is institutional memory, which is knowledge of how the organization made decisions in the past and what lessons were learned from those experiences. The other form is tacit knowledge of what works in their individual jobs. Preparing to transfer knowledge from one experienced manager or worker to another is called knowledge transfer. Technical succession planning is the process of planning for, and carrying out, knowledge transfer (DeLong, 2004; Rothwell and Poduch, 2004).

Managers are not the only ones with technical knowledge. Indeed, technical knowledge is often most important with groups that rely on special technical knowledge to do their work—such as engineers, IT professionals, accounting professionals, research scientists, and others. Technical succession planning is growing more important in a global knowledge economy.

While there are many ways to transfer knowledge from more to less-experienced workers (see Rothwell, 2004), a simple tool can facilitate a quick way to consider the special knowledge, based on experience, that managers possess that should be transferred to possible replacements. Use the tool shown in Exhibit 3 to begin this process. While it does not help to capture all the most important technical knowledge, it does facilitate early efforts to lead managers to think about the issue and the need to plan for transfer. Try it out. Then involve managers in developing an approach to capture and transfer the know-how of in-house experts, sometimes called HiPros (High Professionals) to distinguish them from HiPos (High Potentials).
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What Is Social Relationship Succession Planning, and What Tool Can Make It Easier?
Technical knowledge is not the only important knowledge that should be the focus of knowledge transfer efforts. Another key issue to consider is how to transfer professional contacts and relationships (see Rothwell, 2007). That is called social relationship succession planning. It is important to any group—such as marketing, sales, public relations, or government lobbying—in which the knowledge of who to call to get results is key to getting those results. In some fields, building a social network can be the endeavor of a whole career. When the person who has done built that social network retires or otherwise leaves the organization, that social network is lost. That can sometimes translate into lost sales, diminished influence, and other problems for an organization.

Simply introducing a replacement to other people will not “transfer” the social contacts. Instead, the person who is about to leave the organization must set up one or more projects between the target of the social network and the successor to build trust and confidence. The person making the transfer then monitors the relationship to ensure that trust is built. Only then can a true transfer take place.

Use the Worksheet in Exhibit 4 to facilitate discussions about the key social networks enjoyed by various leaders and who must acquire those contacts—or else bring special contacts of their own to a replacement decision. While this approach is not perfect, it does begin to focus attention on the issue and provides a simple tool to think about it.
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Stepping up to the challenge of succession planning can be daunting. Some practitioners find it difficult to find simple but effective ways to facilitate management dialogues about replacement planning, management succession planning, technical succession planning, and social relationship succession planning. While it is true that robust approaches will yield robust results—you do get what you pay for and you do get out of a system the effort you put into it—sometimes practitioners are looking for simple tools to get the process moving. This article provided four simple, practical tools to facilitate such planning.

References
DeLong, D. (2004). Lost knowledge: Confronting the threat of an aging workforce. New York: Oxford University Press.

Rothwell, W. (2007). Social relationship succession planning: A neglected but important issue?. Asian Quality, 2(4), 34-36.

Rothwell, W. (2004). Knowledge transfer: 12 strategies for succession management. IPMA-HR News, pp. 10-12.

Rothwell, W., and Poduch, S. (2004). Introducing technical (not managerial) succession planning. Public Personnel Management, 33(4), 405-420.


William J. Rothwell, Ph.D., SPHR is President of Rothwell & Associates, Inc., a full-service consulting company that specializes in a robust range of succession planning practices. He is also Professor of workforce education and development on the University Park campus of The Pennsylvania State University. With over 20 years of full-time business and government experience before he arrived at Penn State, he has consulted with over 40 multinational corporations. Author of over 300 books, book chapters and articles, he is perhaps best known for the Strategic Development of Talent (HRD Press, 2004), Effective Succession Planning, 3rd ed. (AMACOM, 2005), Career Planning and Succession Management (Greenwood Press, 2005), Human Resource Transformation (Davies-Black, 2008) and Working Longer: Recruiting, Developing and Retaining Older Workers (Amacom, 2008).

The Power of Asking

The Power of Asking; 7 Ways to Boost Your Business
by Jack Canfield

The gift called “asking” has been around for a long, long time. One of life’s fundamental truths states, “Ask and you shall receive.” Kids are masters at using this gift, but we adults seem to have lost our ability to ask. We come up with all sorts of excuses and reasons to avoid any possibility of rejection. 

Yet the world responds to those who ask! If you are not moving closer to what you want, you probably aren’t doing enough asking. 

Here are seven asking strategies you can implement in your business (and in life) to boost your results and your bottom line: 

Asking Strategy #1: Ask for Information

To win potential new clients, you first need to know what their current challenges are, what they want to accomplish and how they plan to do it. Only then can you proceed to demonstrate the advantages of your unique product or service. 

Ask questions starting with the words who, why, what, where, when and how to obtain the information you need. Only when you truly understand and appreciate a prospect’s needs can you offer a solution. Once you know what's important to them, stay on this topic and find solutions for them.

Asking Strategy #2: Ask for Business 

Here’s an amazing statistic: after giving a complete presentation about the benefits of their product or service, more than 60 percent of the time salespeople never ask for the order! That’s a bad habit, and one that could ultimately put you out of business. 

Always ask a closing question to secure the business. Don’t waffle or talk around it—or worse, wait for your prospect to ask you. No doubt you have heard of many good ways to ask the question, “Would you like to give it a try?” The point is, ask. 

Asking Strategy #3: Ask for Written Endorsements 

Well-written, results-oriented testimonials from highly respected people are powerful for future sales. They solidify the quality of your product or service and leverage you as a person who has integrity, is trustworthy and gets the job done on time. 

When is the best time to ask? Right after you have provided excellent service, gone the extra mile to help out, or in any other way made your customer really happy. 

Simply ask if your customer would be willing to give you a testimonial about the value of your product or service, plus any other helpful comments. 

Asking Strategy #4: Ask for Top-Quality Referrals 

Just about everyone in business knows the importance of referrals. It’s the easiest, least expensive way of ensuring your growth and success in the marketplace. 

Your core clients will gladly give you referrals because you treat them so well. So why not ask all of them for referrals? It’s a habit that will dramatically increase your income. Like any other habit, the more you do it the easier it becomes. 

Asking Strategy #5: Ask for More Business 

Look for other products or services you can provide your customers. Devise a system that tells you when your clients will require more of your products. The simplest way is to ask your customers when you should contact them to reorder. It’s often easier to sell your existing clients more than to go looking for new ones. 

Asking Strategy #6: Ask to Renegotiate 

Regular business activities include negotiation. Many businesses get stuck because they lack skills in negotiation, yet this is simply another form of asking that can save a lot of time and money. Look at your vendors and suppliers and see if there are areas where you can be saving money. Just ask. 

All sorts of contracts can be renegotiated in your personal life, too, such as changing your mortgage terms and rate, reviewing your cell phone plan and requesting a policy review with your insurance agent. As long as you negotiate ethically and in the spirit of win-win, you can enjoy a lot of flexibility. Nothing is ever cast in stone. 

Asking Strategy #7: Ask for Feedback 

This is a powerful way to fine-tune your business that is often overlooked. How do you really know if your product or service is meeting your customers’ needs? Ask them, “How are we doing? What can we do to improve our service to you? Please share what you like or don’t like about our products.” Set up regular customer surveys that ask good questions and tough questions. 

HOW TO ASK 

Some people don’t enjoy the fruits of asking because they don't ask effectively. If you use vague language you will not be clearly understood. Here are five ways to ensure that your asking gets results. 

Ask Clearly 
Be precise. Think clearly about your request. Take time to prepare. Use a note pad to pick words that have the greatest impact. Words are powerful, so choose them carefully. 

Ask with Confidence 
People who ask confidently get more than those who are hesitant and uncertain. When you’ve figured out what you want to ask for, do it with certainty, boldness and confidence. 

Ask Consistently 
Some people fold after making one timid request. They quit too soon. Keep asking until you find the answers. In prospecting there are usually four or five “no’s” before you get a “yes.” Top producers understand this. When you find a way to ask that works, keep on asking it.

Ask Creatively 
In this age of global competition, your asking may get lost in the crowd, unheard by the decision-makers you hope to reach. There is a way around this. If you want someone’s attention, don’t ask the ordinary way. Use your creativity to dream up a high-impact presentation. 

Ask Sincerely
When you really need help, people will respond. Sincerity means dropping the image facade and showing a willingness to be vulnerable. Tell it the way it is, lumps and all. Don’t worry if your presentation isn’t perfect; ask from your heart. Keep it simple and people will open up to you.

© 2008 Jack Canfield

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