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The 4 things that DRAMATICALLY improve teamwork…

Posted by ethicalbusinessbuilder on March 17, 2008

This evening my sister was working on a speech for a college class where she wanted to teach people how to improve teamwork in a business. Wow, a summary of how to improve teamwork in any business in only 5 minutes??? We’re going to have to narrow that down. So we decided on improving the productivity of a team that already exists. In other words, we’re not hiring new people, expanding a business, or firing unproductive people. So we talked it through for a few minutes and here are 5-minute’s worth of suggestions to having the best team around. ;-)

  1. The most important factor in determining an employee’s satisfaction is his relationship with his direct manager. That’s more important than salary, benefits, flex time, over time, company picnics and the like. We’re talking about his direct superior and not the CEO, CFO, or departmental VP. If his manager does not have solid rapport with him, he will not be happy. This is extremely important because almost every other tip, suggestion, or improvement MUST take this first factor into account. Don’t forget it!
  2. One of the most common complaints you’ll hear from employees, if you bother to ask them, is, “I don’t know what I’m supposed to do.” Sure, she knows her title is “receptionist” or “salesperson” or “plumber”, but what does that mean she has to do every hour of every day. As her direct manager you need to define that. The best way to figure this out is to provide enough detail, goals, benchmarks, and Key Performance Indicators so that every single day your team member can easily answer whether they had a good and productive day. They should then be able to list exactly what they accomplished that made it successful and productive.
  3. Tie compensation to the Key Performance Indicators (KPI’s). The number of businesses that do this HAS to be less than 1 in 10,000. Out of several hundred businesses I’ve worked with in some capacity only 1 comes to mind that does this extremely well with a few others doing this moderately well. Most don’t do this at all. If you determine someone needs to get 8 “jobs”, “services”, “deliveries”, or “sales” done every day but you pay them by the hour, what’s his incentive to do more than 4 or more than 8 once they get those target 8 done? As a general rule, salespeople are the only ones who have jobs strictly based on commissions. Why? If an engineer designs a brake system that doesn’t work, why should he get paid the same as an engineer who designs one that is flawless? A friend who is an engineer for Penn DOT told me he was welcomed to his engineering job with “Congratulations! You have a job for life. No matter how bad you screw up you basically can’t get fired.” You think that government agency is attracting “go-getters”? Even if it did, as I respect my friend’s engineering skill, how long do you think it will be before those employees are taught to accept less than the best in their own work? Figure out a way to provide an incentive for EVERY single person on your team even if its just tied to the overall company revenue targets. Software companies often do this by providing stock to employees. Public companies do it by offering 401k plans with discounts on the company stock. Depending on the size of the company, it can be very difficult for someone to gauge the effectiveness of his work when his only non-salaried incentive is the stock price.
  4. Provide quarterly reviews with every team member. So you’ve defined for everyone on the team what makes up a productive day and you even related incentives to that productivity, now you need to review those with them at least every 90 days. Many sales managers and sales teams do this on a weekly basis. Again, why are salespeople given such strong incentives to produce and few others are? My recommendation is to get your hands on “First, Break All The Rules” by Marcus Buckingham IMMEDIATELY and use the 12 questions he’s developed from information gathered from over 80,000 managers over 20 years for your reviews. These reviews need to achieve a few key objectives:
    1. Determine the team member’s progress on meeting the goals from last session
    2. Determine whether you as a manager can do more to help them achieve those goals
    3. Set new goals for the next 90 days

    This is not a complaint session where you attack the individual and highlight all that they’ve done wrong. Numerous tests and studies have proven that mice and men both respond much better to positive affirmation than to critical attacks. Don’t say things like “Look, Bob, you did this wrong. It’s spelled out in detail in the manual so you don’t have any excuses.” You’ve immediately put Bob on the defensive, probably upset him, and didn’t score too many rapport-building points with him. Instead try, “Hey Bob I have a few copies of your TPS reports here. How can we work together to make these even better this time? Was the manual clear or should we improve it?” Now, if that team member thinks you’re a chump, then the second wording may only get you slightly farther which is why having a strong relationship and solid rapport with your team members (reference #1) is so important.

So there’s the 5 minute performance review for your team. The next step is reviewing your company Vision, Mission, and Culture to help fill in all the blanks that are not spelled out in the company manual or in the KPI’s.

To your success, Bryan

Posted in Team Building | Tagged: , , , , , | No Comments »

Your company has a culture. Did you choose it?

Posted by ethicalbusinessbuilder on March 12, 2008

Yosemite National ParkIn my last blog I mentioned that if you’re an Ethical Business Builder, but none of your employees are aware of that, who cares? It’s important that you make your whole team aware of the importance of ethics in business.

Obviously your actions are the most important part of being an ethical leader. If you have an “open-door policy” but you’re never around - or you claim that its important that you treat all people with respect, but your team members can hear you flipping out on your vendors on a regular basis as a means of “getting the best deal”, then it doesn’t matter what you write in your ethical policies. The only things important to your team members are the things that you do - not what you say. I’ve read in numerous articles and books that most businesses take on the traits of their founders. Microsoft is like Bill, Apple like Steve, Facebook like Mark, and Google is like its 2 founders…

ALL businesses have a culture. Some are high-energy and highly-competitive like Nordstrom’s and some are more laid-back like your typical start-work-at-noon-and-sit-on-your-bean-bag silicon valley software company. In both of those instances the companies “culture” was deliberately structured to be a certain way. The founders of those companies apparently determined (or it just happened by accident) that the most productive way to deal with their employees was to develop a culture to cater to the type of employee they wanted. This is important because not every person can excel in every environment and company culture. It’s well-known that Nordstrom’s employees either love it there or hate it. The ones who hate it rarely last more than 6 months. That’s the way management likes it. If you’re not going to thrive in the culture they’ve created, then they don’t want you. Does the culture that you’ve developed in your company attract the employees who will excel in your business?

The examples above, however, don’t talk at all about the ethical underpinnings of those cultures. Just like other aspects of culture, if you don’t express your culture, including the ethics that you expect, in writing and then demonstrate through your own actions that you believe in them 100%, then the culture will create itself. Generally that “self-created” culture will come partially from the founder and partially from whatever the other employees think is appropriate. My first encounter with a defined set of “Culture Statements” came from Brad Sugars in his book Instant Team Building and from his entrepreneur masters class. Actually, I can’t think of one other business book or article that has emphasized the importance of defined culture statements.

Culture statements are a series of statements that simply tell your employees and company stakeholders what values and culture your company employs. It’ll probably make more sense if you just read the 12 Points of Culture that I developed for a business I co-founded, cribME!.

12 Points of Culture

  • We treat our customers, colleagues, partners, vendors, and shareholders with respect. In unsettling situations we do our best to empathize with the other side and view the situation from their perspective.

  • We maintain integrity in all interactions. The end never justifies the means. Deliberate lying is never an option. If ever we make a mistake and accidentally make an inaccurate statement we will correct that statement as soon as reasonable.

  • We work diligently to make effective and open communication a high priority by avoiding gossip, harmful sarcasm, and verbal attacks. If we have a question or concern about someone, we strive to ask them directly instead of listening solely to those around them.

  • We are never satisfied with “good enough” and continually strive to improve ourselves, facilities, products, and services to best serve the company stakeholders.

  • The team leaders do their best to provide a healthy and productive environment for their team members to excel at their jobs every day.

  • We are positive toward each other, focusing on exceptional work and constructively critiquing when warranted. We are open to others positive suggestions for improvement.

  • We understand that everyperson we encounter has something to teach us and so will learn from everyone around us.

  • We appreciate that profit is the life-blood of every business and a profitable business benefits everyone in the organization as well as in the communities we serve. We work together to minimize unnecessary expenses and waste to ensure a lasting, profitable business.

  • We strive to be on time and meet deadlines. If we say we are going to do something by a certain time, we do it. If for some reason that is impossible, we communicate another solution as soon as we are aware that we will be late.

  • We recognize that the customer is not always right, however, whether he is or not, its our responsibility to make him feel that way.

  • We hold ourselves accountable for our own actions and responsibilities. We admit to making mistakes and continually learn from them. When we learn from mistakes, they are not failures.

  • We take calculated risks to improve our areas of responsibility. We try new and innovative solutions to daily problems. We quickly discard the solutions that do not work and continually improve those that do.

One of the benefits of developing culture statements for one business is how easily they can be amended to apply to almost any business. Statements I wrote for another business included a point of culture emphasizing the importance of safety. There aren’t a whole lot of dangerous situations in the software business so I didn’t feel that was necessary to emphasize for cribME!.

It’s important to make use of and review all of the points of culture, along with your vision and mission, BEFORE you hire someone. The potential hire needs to be aware of what makes your company unique and it gives you an opportunity to measure her reaction to your emphasis on ethics.

This blog is just barely touching the surface of the importance of dictating your culture to shaping your business. One of the primary findings in, Built to Last: Successful Habits of Visionary Companies, that contradicted the teachings of almost every MBA program on the planet, is that the businesses that survived and excelled over time were often the ones that were centered around a core business concept, not a great product.

We’ll get more in depth into the Vision and Mission in another blog, however, for now, start reviewing your business’ current culture and compare that with the culture you’d like it to have. In the next few months I’ll be working to define the culture of a few startups, as well as potentially revamp the culture of a business that’s been around for over 10 years. I look forward to recording the lessons learned from both of those processes.

To your success, Bryan

Posted in Leadership, Team Building | Tagged: , , , , , | 5 Comments »

The difference between good and bad is in how it’s communicated

Posted by ethicalbusinessbuilder on March 7, 2008

As I’m thinking of lessons that are extremely important for all of the members of our teams to understand, communication jumps to mind. Behind ethics and more specifically “being honest with all people”, effective communication is probably the most important part of the culture of any organization.

In my experience visiting businesses I’ve seen plenty of examples of why great communication is so important to an organization. However, 3 great business leaders who I’ve had the pleasure of meeting and learning from taught me a few simple lessons that drive home the point a bit easier.

Behind my father, Steve Dickerson and Bob Reiss are probably the most influential businessmen I have met. Mr. Dickerson has an amazing knack for story-telling and an even more uncanny ability to solve problems. He was one of the people I interviewed and referenced in my very first blog and he’s the one who taught me that the difference between a positive and a negative action almost always lies in the way its communicated.

So lets consider this for a moment. You’re in charge of a manufacturing facility that employs a few thousand people (over 2,000). You’re notified 2 years ahead of time that the facility is going to be closed. When do you let your employees know? If you give them 1-2 months then they may just leave in spite. If you give them 4-6 months you’ll probably have most people leaving before you even shutdown and then you’ll have to start hiring people for just a few months. If you give them any more notice then for sure people will leave which makes your job a whole lot tougher. It’s not like you can prevent the plant closure, so its not your fault. Take a few minutes and think through what you could do in this situation to best help all of the company stakeholders. Obviously the way you handle this situation can certainly dictate what will happen to you after the end of those 2 years.

Mr. Dickerson looks at the world a whole lot differently than most people. I have never personally met someone so confident that he could overcome any obstacle and solve any problem. He elected to tell all of his team members right away. Now read this carefully because the way he communicated the plant closing is what turned this situation into a “positive.” Before he told the entire team, he called in upper management and let them know and informed them that they have 2 years to find jobs for everyone in the plant. That’s right, his management team including himself took the personal responsibility to find employment for everyone who was going to be laid off. So they did some research and found a new manufacturing plant was being built not too far away and some other businesses were expanding. The day the plant closed 2 years later, every single one of the “laid-off” employees were now employed somewhere else or had made appropriate plans for retirement.

So the first question that comes to mind is, why isn’t that story taught in every business ethics class in every school and MBA program in the country? Doing the right thing and COMMUNICATING effectively can turn even the most negative situations positive.

Now many of us may not be responsible for the livelihoods of thousands of people so that story may seem to be a bit beyond our capabilities. So let’s take a look at a lesson that Jamie Hresko taught me.

Mr. Hresko was the plant manager for the Pontiac G6 plant in MI. To get an idea of his capabilities, when he took over responsibility for that plant there were over 3,000 grievances outstanding from the union. Amazingly, as I understand it, that’s only slightly higher than the average for a GM facility. However, within 3 years, Mr. Hresko had managed to drop that number to around 30. The lowest of any union facility under GM’s ownership. One of his 5 keys to doing that was Communication and he told this story to illustrate.

He said one day the union rep came to him and said we need another water fountain out on the floor. Jaime considered for a split second that they cut the workers’ hours, the labor force, and their wages (if I recall correctly) and the grievances were still unrealistically low so the least he could do is give them a water fountain. He said “no problem we’ll get it ordered right away” and then asked someone on his staff to make sure they had their water fountain. Two weeks go by and still no water fountain so the rep comes back to Mr. Hresko and asks where the fountain is. Mr. Hresko tells him the truth, “you know what, I’m not sure. I asked someone to take care of that for me and we’re definitely getting it for you so can you give me a chance to find out what’s going on?” So he went and found out the fountain had been ordered, everything had been taken care of, and it would be installed the next day. Low and behold the fountain shows up the next day and all the union members thank Mr. Hresko and start saying “man that guy is good. We don’t have a water fountain for 2 weeks and soon as we mention it to him he takes care of us. If you want anything done around here you have to go to Mr. Hresko.” The reality of the situation was he did absolutely nothing. The person he had asked to take care of the fountain did exactly that. Except one thing. He failed to communicate with the union what was going on and how long it would take. That simple act of communication would have instilled more faith from the union in the rest of management, would have saved Mr. Hresko the time of researching what was going on, and would have prevented the union from getting upset because no one took care of the water fountain for 2 weeks.

Now in the interest of full disclosure, it has been over 3 years since I’ve heard either of these stories so they are paraphrased, however I’m certain my numbers are very close. Even if they were off a bit and Mr. Dickerson helped 3,000 or 1,800 people find new jobs - or if Mr. Hresko only reduced the grievances to 50 or 60 would the stories be any less compelling?

The point is, in every situation, be it a conversation with your sister, husband, colleague, boss, or team member, you should ALWAYS be looking for the most positive way to communicate. Often times being positive simply means calling people back when you say you will, or keeping people up-to-date on the progress of a project. Dale Carnegie in his classic, How to Win Friends & Influence People, suggests in instances where you must critique someone you start out with a positive statement about the person first, so as not to put them on the defensive.

Bob Reiss made a point of assuring his employees that ethics were a high priority. For example, he always kept a copy of the 10 commandments on his desk to reference when a situation with an employee warranted it. From several sources familiar with his companies I was told it was nearly impossible to get a job there. No one ever left. Once you had a job there you stayed for life because you loved working there so much. In one instance, an employee of Mr. Reiss’ approached him with a difficult situation that she was very concerned about sharing with him. Her boss had apparently done something inappropriate or unethical (I was never told what he did) and from experiences she’s had at previous jobs, going above the head of your boss was never a good idea. Mr. Reiss thanked her for bringing the situation to his attention and took care of the problem (I believe by getting rid of that manager). Had Mr. Reiss not been known as an owner with high ethical standards and who strongly valued honesty, there’s a good chance that lady would have never felt comfortable enough to approach him. So if you’re going to be an ethical business builder, make sure you communicate that with your team members. After all, if your team doesn’t know that, are you really an ethical business builder or leader?

The best way to communicate those ethics is through actions and a good way to hold yourself and your team accountable is by setting very specific guidelines for the “culture” you expect at your business. We’ll get more into the importance of defining your business’ culture in another blog.

To your success, Bryan

Posted in Business Ethics, Leadership, Team Building | Tagged: , , , , | No Comments »

The art of the win-win situation. Why you need to be your vendors’ best customer.

Posted by ethicalbusinessbuilder on March 3, 2008

As I get involved with more businesses and, in particular, with individuals who are working on my teams it has occurred to me that their are several business axioms that are very important to me and should be to all of my team members. One of those axioms is always finding a win-win situation.

In basic terms this means that everyone who is involved with a transaction should “win” when that transaction is complete. For instance, if I’m selling my house, at closing we should have a win-win-win-win situation. My house should be sold at a price I was willing to accept, the buyer should have a house that was accurately represented, and that they’re happy with, the realtor should be reasonably paid for her services, and the mortgage broker should be paid for his. Everyone got what they wanted so everyone wins.

In business you occasionally have an unscrupulous salesman who will tell a prospect anything to get the sale. You may even have instances where a boss will go to his grave spouting “The customer is always right!” when in reality the customer was wrong and the employee deserved the boss’ support. However in my experience, the number 1 area people forget this win-win philosophy is when dealing with vendors.

It first became very clear to me that you always treat your vendors well when I was a paperboy. As a paperboy with 50+ papers to deliver, almost any time it rained you inevitably end up with a few wet papers. So you have some choices. You can wait for hours as you request the newspaper company to come replace your wet papers which would make the papers late - or you deliver them as is. Generally, as long as it was only a few papers and they weren’t destroyed, I chose the latter. Now out of 50 people, who do you give those few wet papers to? Certainly not the people who are nice to you, invite you inside when its cold, and give you a big tip. Why would you take the risk of upsetting them? No, you choose the people who are mean and cheap. For me personally, mean always trumped cheap.

In one instance, I recall a customer blatantly accusing me of lying and trying to cheat them by me asking them to pay more weeks than they owed. To this day, I’m 100% certain that wasn’t the case and even if I had made a mistake, accusing me of lying was something I took VERY personally. At that point, I would have preferred to just erase their debt and lose them as a customer. However, that wasn’t an option so, from then on, they became my only customer who mailed their checks to the newspaper directly. In their minds, the problem was solved. In reality, they now received every wet and late paper I ever delivered. Since I never had to confront them again to collect money, it made it very easy for me. After all, someone had to get the late and/or wet paper, why not them?

In the “real world” of business this has rung true for me more times than I can possibly remember. As a business consultant I travel a lot and have personally worked with nearly 100 business owners. Without a doubt, a few jump out in my mind as people who have treated me exceedingly well. One client in New Mexico made a point of always taking me out to the most fancy restaurants and putting me in nice hotels. He probably spent a few hundred dollars extra per trip that he didn’t “need to.” He was also one of the only customers who always paid me with a check in full before I walked out the door to fly home - a check that he guaranteed was as solid as oak. With those 2 actions, he endeared himself to me and my boss. In return, everyone on his staff had my cell phone number and felt very comfortable using it because I made sure to always help them as soon as I possibly could. He treated me better than any other customer and so, without giving it much thought, I did my best to provide the absolute best service for him.

Personally, I work hard and enjoy “living well.” My living style is anything but “cheap.” My father recognized this and so pointed out “that the quickest way to increase profits is to cut expenses.” If you think about it, it makes perfect sense. However, there’s a limit.

One out-of-state client I worked with happened to be located very close to a handful of friends and the university I attended. Because of that, I got to know them exceedingly well and routinely stopped by their office to make sure everything was going alright. I never charged for any of these services and in exchange received some free water (total value of the water was about $200 and at that point 2 hours of my time was worth that so they were WAY ahead on the deal). They had my cell phone number and used it when they needed and I helped as I could. Quite literally I spent more time with them than any other customer, including my father’s business, for several years. In one instance, I was visiting their office and emailed the General Manager ahead of time indicating that on this trip I’d stay with friends so all he had to worry about as far as travel expenses was my mileage for me to get there. When we spoke on the phone he agreed. When the owner of the business got the bill and learned that while visiting that customer I also took time while I was in the area to sell my house, he refused to pay. The house was sold 3 days before I even showed up in the office and because of that it allowed me to be in their office bright and early at 8am instead closer to noon if I would have driven directly to their office that morning. We’re talking about probably less than $200 (I can’t even remember the exact amount). Easily less than I had saved them by staying with friends for a few nights. So I spoke with the owner who happened to, at one time, be the CEO for a large international organization and apparently a staunch believer in “cutting expenses is the fastest way to increase profits.” I emailed the owner a copy of the emails that the GM had received and clarified that I told him ahead of time about the expenses and the GM had agreed. The GM lied and said that was not the case and the owner refused to pay saying that my emails didn’t matter since he had to backup his GM. Before this event, I would have considered this owner to be one whom I respected nearly the most out of all of the owner’s I had dealt with. In the end, my boss allowed them to not pay (though my boss did still pay me) and I felt cheated and taken advantage of. Over 3 years later and I still will not take a phone call from them and refuse to work onsite in their office again. I have no time to deal with unprincipled behavior and the money I could make by continuing to work with them would never be worth it.

I have dozens of stories to further illustrate this point - from the gentleman in Massachusetts who sends me cheese every year for Christmas, to the owner in Texas who forgave me when I billed him too much for gasoline. The people who have treated me the best, have received priority service. That is how it should be. Always treat your best customers the best. This also means that, your vendors should consider you one of their best customers for you to receive the best service.
This is NOT true for most businesses. In most businesses, the customer who screams the loudest receives the most attention. The employee who causes the most trouble receives the most attention. This irritates me to no end because it honestly makes no sense. If you want to bring ethics into the picture you could even argue that its unethical to treat superior customers as anything less than superior. In essence, it’s not “fair” to treat them as anything less. Criminals are treated as criminals. War heroes are treated as war heroes. Superior customers deserve to be treated as superior customers.
When you treat your vendors poorly, you will always lose. I know of businesses where particularly difficult customers will literally get billed EXTRA for being a pain in the butt! I’ve seen it happen time and time again.

So the lessons I’ve learned from all of these and many more experiences that every one of my team members should understand are:

  1. When dealing with vendors, paying the least amount of money is NOT always getting the best deal.
  2. In every situation, every party involved should have a “win” and be very excited about doing business with you again. If not, rework the deal.
  3. You give your best team members (employees) and best customers your absolute best service.

As for #3, most business people have probably learned the 80/20 rule where the top 20% of your customers generate 80% of your profits and the bottom 20% of your customers generate 80% of your problems. After going through the situation with the client who refused to pay my mileage, I told my boss I could care less if we lost them as a customer and I sincerely meant it.

I’m not the only one who thinks this way as Brad Sugars talks about “grading your customers” and getting rid of those customers with a D or lower and possibly even those graded with a C. Literally sending them a letter indicating you will no longer serve them and offering some suggestions for who may. He has personally owned over 50 businesses and claims this is true for every business in every industry.

A few years back Sprint sent notices to thousands of their customers that they had 30 days to find a new cell phone company because Sprint would no longer service them.

Marcus Buckingham talks about how one of the “rules” that should be broken is always spend the most time with the people who need the most help. Instead, he says that you will always reap a greater reward by spending the most time with your best people.

Admittedly, when I was 16 years old running my paper route, I hadn’t read any business books or had anyone teach me that you treat your best customers the best. It just seemed to be common sense. If that’s the case, then why do so many businesses I visit spend so much time taking care of their worst customers and employees instead of finding new ways to serve their best customers and employees?

If you’re ever lucky enough to work with me, make sure you remember these lessons. ;-)

To your success, Bryan

Posted in Leadership, Team Building | Tagged: , , , , , | 1 Comment »

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