In early March many clients are in the middle of their annual performance review process. Though much has been written about companies making dramatic changes to their performance reviews, the annual review is still a standard organizational practice for most organizations. Apropos, I am going to do a short series on performance management practices and for this post I will start with a few fundamental questions.
What and who are you really evaluating?
You are evaluating:
Before you say, “duh”, let me explain. Almost universally when clients discuss individual performance, they focus on the person’s strengths, weaknesses and goal achievement. They often fail to articulate the context. The context is the system (small and large) and business situation in which the role currently exists. It’s very important to understand that you are not reviewing a person’s worth as a human being but the contribution they make and value they bring to a specific role. I want leaders to articulate this consistently in their performance conversations (preferably all year long) and to ensure that their team understands it. It matters because context, more than anything else, impacts performance. Strengths and weaknesses are almost always based upon the situation. In other words, the leader is saying, “given the business situation and the priorities, expectations and requirements for this specific role, here is how you are doing…”
This has become an even more important frame because as organizations change faster so do the knowledge, skill requirements and expectations of many of their positions. Leaders need to talk about this, and hopefully more often than the annual performance review.
When a client is describing a leader, who is underperforming and they are preparing to deliver the dreaded “below expectations” rating, I like them to frame the context first. If newer to the role did the individual demonstrate they had the right knowledge when they were hired? Did the position expectations change due to an important business change? If they have been with the organization for a while, what was their past performance? In which roles did they excel? What has changed in the role, the division or the organization that may have impacted the role? You get the idea.
Most importantly, when a manager is preparing for their performance conversations, I want them to consider each situation more holistically. This is just as important when the performance is excellent as when it is below expectations. But it is always more difficult when delivering a lower performance rating. My main point is to take the time to put the performance evaluation in the proper context and make sure you communicate that. People are way bigger and more amazing than their deficits and strengths. But you are evaluating their performance in a role they are being paid to accomplish. So it’s important to say, “here is where you need to learn and grow given your past experience, knowledge and where we need to take this role.” Then you can talk about what’s possible going forward given the role, the individual and the context.
Like most skills, even complex ones like strategic thinking, we now know that if you want to get better at it, you can. It’s true that some personality variables make us more likely to naturally think more strategically, but everyone, even those not predisposed to, can get better.
In my experience, if clients want to learn to think more strategically they need to:
Sounds very simple but both are difficult. Clients are inundated by massive amounts of communication. Their in-box and all of the internal communication applications and software (not to mention social media with which we all feel compelled to interact) demand more and more of their time. In the hyper collaborative environments that most work, their day is packed with meetings. It’s no wonder that when I ask clients when they have time to reflect, they look at me like I have asked them to perform neurosurgery.
Getting a handle on your schedule is probably one of the most important aspects of preparing to be a more strategic thinker. If your day is spent blocking and tackling, and for most leaders it is, then you need to find a way to free up some space for “think time”. And once you do, you can’t use it to catch up on your e-mail. It’s not about action at this point, it’s about reflection.
Getting outside your normal routine requires you to spend time reading things you might not normally read, conversing with people inside and out of your organization who have different roles and accountability (and different backgrounds than you) and attending events that involve people outside your organization or even industry. If you want to view the world more holistically, and to think strategically you do, you need to view the world beyond your own.
I love helping clients and their teams expand their ability to think strategically because I know it will improve their impact, planning, goal setting and performance. You have to be intentional and patient. It takes time. It’s worth it.
There is much written about the founder’s role after an external CEO is hired to lead the organization. As with everything I write, my perspective is from hands-on experience working with founders and the leaders to whom they will transition accountability for running their organization.
Here are the two things I know for sure:
When founders stay more involved than they should, their team and others will have a hard time not deferring to them. This creates a lot of inefficiency. The team knows they have a new CEO, but with the founder still involved, they may not know who is in charge. They often feel like they have two bosses and don’t want to be disrespectful to either. Most founders don’t completely understand their impact. They are often so revered for what they have accomplished that it can be very hard for their employees to let them go, especially if they see them in the business. Even when the executive team knows that the founder is no longer effective, if they are beloved, and they often are, the transition can be even more difficult.
The new CEO comes in ready to hit the ground running. They know they have 6-12 months to really set the course for the business. The first 100 days are particularly important. Unfortunately, this is usually the time that the founder is having trouble transitioning out of their role, even if they want to hand over the business.
Nobody, especially the founder, is trying to sabotage the business. But that is exactly what happens when the founder stays in the business trying to co-lead with the new CEO. It is a very emotional process to hand over an amazing business you created, nurtured and loved…willed into its very existence. It can be even more difficult to let go of some of the relationships with people who have been in the trenches with you from the start.
So, what to do?
I recommend that before the new CEO starts, the founder gets help in defining his or her new role. Reflecting with them on how they can be of best and highest service and how they will be involved are important to explore before they have to hand over the business. Founders can introduce the new CEO to their most important clients and relationships. They can have great insights into the business development opportunities. If they are experts in their fields and they usually are, they can serve as influential advisors on proposals or design and approach. It will also be important for the new CEO and founder to communicate their new roles, the boundaries for each and cascade this to the whole organization (founders have connections at every level).
Sometimes founders should exit. The way most are wired, they love to create and start and that is where they will be most happy and effective. This decision should be based on what will be best for the business.
The founders I have worked with are passionate about the business they created, want it to succeed and care about the people. Giving up things we love is a courageous act. Knowing that it is the right thing to do doesn’t always make it easier. Underestimating the emotional aspects of this type of transfer of leadership will cause unnecessary confusion and angst. This process requires preparation, respect and care. Founders can often contribute. Defining how is extremely important.
A client I highly regard and have known for many years recently decided to leave her executive role at her organization. I was surprised. She was very committed to her company and really loved her boss. But she assessed the situation and decided that what she wanted and needed was no longer aligned with her organization. She took a new role for a really cool company. She will do well. Though this client’s situation is very different from mine, it brought back memories for me of when the CEO to whom I reported resigned. After meeting with the new CEO, I realized I had a difficult decision to make. Soon after, I left my job. I received two job offers at the time, but after talking with my co-pilot (my supportive and wise husband), I realized it was time to start my own practice. To say I haven’t looked back would be inaccurate. I have, many times. But overall it has been a great decision and a good fit for me. I always felt that everything was my responsibility, and with my small business, it truly is.
When we accept a role at a corporation, no matter who we are, we will need to adapt. The more aligned the organization’s mission, culture and values are with who we are and our way of working, the less adaptation that we will need to make. When we need to adapt in ways that are not aligned with how we want to lead or the values we hold, that requires a different level of adaptation. Both scenarios represent sacrifices because we are giving up something we at least like or hold dear in order to remain in our organization. When these sacrifices start to diminish our energy or the joy we feel when we head to work, it’s time to assess if the sacrifices are worth it.
Here are some examples of “sacrifices” that can be good for us:
Here are examples of sacrifices about which you should be skeptical:
Of course, there are many more examples I could give. When I am working with an executive who is unhappy in their role and I ask if the sacrifices are worth it, they often point to their very large compensation package, their kid’s tuition, etc., as if it's a prison sentence. But in reality, it is a choice. And if it goes on for too long, it can impact the things you hold most dear (and may take for granted): your family, your health and your happiness. Is a job really worth sacrificing any of those?
I admit up front that my argument in this post may seem somewhat circuitous. So if you don’t want to read on, here is my conclusion from articles I sight herein: the best companies attract the best (e.g., most skilled, highly educated, and nicest) workers. Civil, polite and nice people are more likely to make more effective leaders. If skilled people are such a business advantage (and the best companies know they are), and if you can’t immediately attract the best and the brightest leaders, invest in and develop the talent you have – help them get better.
Recent research is uncovering that much of the income inequality that is happening in our current economy is due to “a gap in wages between companies, not within them.” And, “more productive, higher paying companies are hiring better workers.” (Corporate Inequality is the Defining Fact of Business Today, HBR, May 2015).
In the article Nicholas Bloom, a professor at Stanford’s business school, comments, “Back in the 1980s, college graduates and low-skilled people would be in every firm. Today, much like our neighborhoods, companies seem to be more segregated by education and skill.” Dr. Bloom goes on to say that this seems to be happening for soft skills as well, “Nice, fun, polite people are sorting into some firms,” and jerks (I can’t use the word he uses) are “sorting into others.”
From a macro-economic, and “health of our society” standpoint, this research is very worrisome. The data confirms yet another advantage of a more privileged background: better and higher paying jobs in the best companies. Thankfully, other research on the impact of what I consider to be “healthier”, more skillful leadership traits and the neuroplasticity of our brain confirms that we can change and learn new behaviors throughout our lives. Regardless of where we start, the family we come from, or where we went to school, we can get better. We can even learn to be nicer.
Studies by Christine Porath, Alexandra Gerbasi and Sebatian Schorch at the Grenoble École de Management, have shown that, “behavior involving politeness and regard for others in the workplace pays off.” At a biotechnology company, a study confirmed “those seen as civil were twice as likely to be viewed as leaders.” (“No Time to Be Nice at Work”, New York Times, June 19, 2015).
Morgan W. McCall Jr., and Michael Lombardo and others found from their research while at the Center for Creative Leadership, that the “no. 1 characteristic associated with an executive’s failure is an insensitive, abrasive or bullying style.” (“Is Your Boss Mean?” The New York Times, June 21, 2015)
So if successful companies hire more skillful and nicer employees, they must see a return on their investment. Higher skilled employees, and this includes healthier, more polite and caring leaders clearly have a big impact on the success of your enterprise. If you can’t immediately attract or afford to hire the “best” leaders and employees, develop the ones you have. And this will most likely need to include teaching them some kind of mindfulness, “self-care practices” (mean people are often mean to themselves as well as others), empathy and kindness.
And if you are a leader who loses control, gets angry or mistreats others, and are not always driving your own emotional bus, get help. You will probably make more money.
For over seven years I worked with some private equity (PE) owned organizations. To say it was an education is an understatement. Like most of the best learning-on-the-job, I made some mistakes, especially early on. However, I am grateful for the experience it gave me. In retrospect, it feels like I received another Master’s degree because the way they think and look at businesses was often different than my earlier learning.
Most people understand that PE invests in companies because they believe that they can create more value than the current operations and business structure are able to achieve. The company I worked with didn’t buy distressed companies. For the most part, they bought good companies where they believed there was unrealized value to be found through some combination of growth, operational excellence initiatives and other efficiencies. They invested in companies and often in the leadership and people strategies and systems – which is how they found me.
Here is what they taught me:
For the record I am aware that some people think of PE as unethical or evil. I knew that when I signed on. As I had no experience I wanted to make my own call. Did they do some things that I thought were short-sighted? Yes, I believe they did. But that is really wired into their goals. With a 3-5-year window for some kind of event (e.g., sale, spin, etc.), they aren’t in it for the long hall. Sometimes they chose people to lead their acquisitions that I think were better suited for other roles (and that is putting it very nicely). In the end, why I continued to do the work is that they did some things exceptionally well. Under their ownership, performance improved. Leaders and teams were challenged to learn new skills and grow (sometimes for the first time) and they sharpened their financial and operational chops. People got a chance to get better. I believe I helped with that and for everything I learned, I hope I was able to contribute something back.
The most important thing they taught me was that every business model and structure has strengths and weaknesses. I have come to think of businesses as “evil” when they allow an abusive or uncaring manager to stay in place, when they allow unethical behavior or mismanagement that has the potential to drive the business into the ground. Having worked in over 12 industries for the last 17 years, with both private and public companies, I can say with confidence that these types of leaders can be found in every type of business. In the end, what separates most good businesses from bad is whether or not they are led by smart, ethical people who care about their employees and demonstrate that through their actions and words. Thankfully, I find these leaders everywhere.
I just completed a project with a new client. We met when I did another project for his organization last year. Thankfully this is how I get most of my work. This project was complex, high stakes, involved a very important client of theirs, and working with some of their senior leaders. For me the project was interesting and it gave me an opportunity to learn more about their business, people and industry. Usually it doesn’t get any better than that. Except in this instance, it does because I also got to work with a leader who brought out the best in me and inspired me to work above and beyond what I needed to do. He motivated a ton of discretionary effort.
Discretionary effort is a largely untapped goldmine of the best, most inspired and innovative contribution that your employees, under the right circumstances and leadership, provide to your business for free. You pay them to do their job. You can’t really pay them for their discretionary effort because it is priceless. Leaders who can evoke this through their behavior, words and actions, are able to tap into what I believe is the holy grail of leadership.
So, what did this client do? For starters, he:
Halfway through the project I told my husband about how I felt and how motivating it was to work with this client (of course keeping client name, etc. anonymous). Hubby looked at me and said, “Wow, and now there is no way you are going to disappoint this guy.” Bingo! That’s the secret sauce! I would be mortified if this guy didn’t love me and the work I was delivering.
You get the picture. This is a guy most smart people would charge up a steep hill for regardless of how difficult it is.
Are there drawbacks with this inspirational leadership? Yes, there are. Some people aren’t worthy of it and they take advantage of it and instead of getting their discretionary effort they use it as an excuse to do less. Some folks aren’t wired for it – they don’t need much recognition. But I don’t see either of these scenarios as often, especially with top talent, and the benefits far outweigh the risks. Because most of us show up wanting to do our best work. The way we lead can light a fire that brings out the best contribution or it can turn people off: full on commitment or half-hearted compliance. In the long run, which do you think it better for your business?
Oh, and there is one more drawback if you are a consultant, you feel pretty bummed when the project ends.
Being an effective leader requires at least a fair amount of self-awareness. Self-awareness is being conscious of and able to articulate your own individual needs, motivations, and feelings. It also means that you are aware that how you experience the world is different from others.
Many leaders think they are self-aware but fewer actually are. Why is this? It’s complicated. From my experience working with hundreds of leaders with diverse backgrounds and expertise, few leaders receive honest feedback from their boss and team. And the higher up you are the less likely people are to tell you the truth about how they experience your leadership. Too much is at stake (including their job) so there is a strong bias to not share feedback. The c-level receives the least feedback. A cornerstone of building self-awareness is access to powerful feedback from those who know you well. This is why a majority of leaders benefit from a formal feedback process (e.g., qualitative interviews, validated personality profiles and multi-rater feedback).
Your success as a leader is measured by the success of myriad others. The higher up you are in the organization, the more people you have reporting to you, and the more this matters. As a leader when you speak and act, it impacts a lot of people. If what you say and do is congruent, everyone sees this and it nurtures trust and climate in a positive way. If what you say and do is incongruent, it diminishes trust and your team’s motivation. The more self-aware you are as a leader, the more likely your words and actions are aligned.
An example of how a lack of self-awareness presents is a leader I will call Sara. Sara tells everyone, “I never micromanage my team.” Sara “fully delegates” an important project to her team. When the project is almost done, she starts asking lots of questions and casts doubt on decisions her team has already made. The project gets derailed as the team realizes they have to go back to square one. Sara’s words don’t match her actions and that is usually the telltale sign of a lack of self-awareness. You can imagine the negative impact Sara’s behavior has on trust, engagement and productivity. It is monumentally ineffective.
Is building greater self-awareness worth it? Absolutely. Here’s why: an investment in your leadership effectiveness by building greater self-awareness impacts the effectiveness and achievement of your team. No matter where you start, you can learn to become more self-aware. Like anything worthwhile, it takes time and intention. I am convinced that it makes for a more skillful leader and creates a happier, less stressful life.
Living near and often working in Chicago, I always feel we do a good job embracing and celebrating our LGBT community. I feel proud of this. Sometimes I delude myself into thinking that we don’t need to talk about it anymore, that it is a no brainer, and that being LGBT is accepted as what it is, normal. Then I hear stories from clients about where they are from or about why they are not out in their workplace and I realize we still have miles to go. It makes me ask the question, “what more can we do?” The most simple, elegant answer is to make sure that we celebrate all the ways we are made, especially in the workplace.
Most straight folks I know talk about acceptance of their LBGT colleagues. That is a good start. But to really embrace and celebrate is different. Let me explain what I mean.
When I get to know clients I love hearing about their parents, significant others, their spouses, and their families. Often, when they talk about the people they love most, their whole being lights up. I have a client who is a West Point graduate and was a leader in the Air Force. He is a commanding, smart, “tough as nails”, and at times very intimidating man. But when he talks about his wife and kids, he brims with joy and it seems to immediately remind him the reason he works so hard in a difficult and demanding job. When clients talk about their kids I can see the love they have for them and it makes them happy to talk about them. Even when their kids are having problems and it is tough going at home, talking about them with colleagues seems to relieve the worry for many. These connections are not distractions, they are additive and they are part of what makes most of us who we are.
I think of all that comes from these families, the joy, worry, passion, angst, and love, as energy. Energy that gets us out of bed, gives us purpose, lights up a dreary workday, and periodically, on a bad day, reminds us of why we don’t quit our jobs. I also happen to believe that our families, whatever they look like, have the ability to make us more empathic, caring, inspired and motivated at work, especially when who we are and who we love is completely accepted and celebrated. We need all this energy to bring our best to work and life, and anything that diminishes it, or who we are, is not good.
Some clients do this well. They make a point of celebrating their employees through family friendly policies of all types, and being public about supporting LGBT employees. Celebration involves both words and actions. Celebration requires that leaders at all levels speak and act openly in support of their LGBT colleagues. It requires that if a disparaging term is used to describe a person who is LGBT in a quiet, one-on-one meeting, that no matter the discomfort, we openly share our concern and dislike about the other person’s use of the term. Celebration requires us to stand up, speak up and delight in all our amazing ability to love and be loved.
One of the Achilles heels of most clients continues to be how to deal with a low performing team member. It’s hard to understand when you evaluate the costs. It’s easier to understand when you factor in the emotional component. Though it can be complicated, the most prevalent reason I find that leaders allow it to persist is that it’s difficult, time consuming and emotionally challenging to coach an underperforming leader or team member. So they put off dealing with the problem to the point where they may sacrifice:
Dealing with low performance can be time consuming and requires skill. Putting off dealing with a performance issue makes it more challenging to resolve. Most importantly it is undermining the fact that something else might be going on and unless you address it, will most likely continue. Underperformance is often about poor job, culture or boss fit, or something larger going on in the employee’s life. If you are a leader, your job is to inspire and motivate high performance from everyone. Allowing underperformance is bad for your team, reputation, business and ultimately for the individual who is not being asked to contribute their best. In the end that is what we all want to do.
Welcome to Moira's blog. I write a bi-monthly post about the work of building better people strategies, systems, teams and leaders.