Culture & Structure

Short-term, Intermediate and Long-term Success

In business and politics, the first 90-100 days is often considered a “honeymoon period” during which the new employee, including a CEO or President, is given a grace period. During the initial stages of the pandemic, almost everybody reported incredible performance by people and companies.

  •  Most employees adapted to working from home quickly; for the majority of people, productivity actually improved compared to normal
  •  Management consultants, like McKinsey, and business and popular media, reported that companies made transition to the lockdown in record time.  Three examples:
    • A hospital went from 200 telemedicine visits in 2019, to 5000 a week, a goal it had estimated would take years.
    • A company running movie theaters when forced to close down decided to retrain 1000 users and ticket sellers to work for an online grocery, and accomplished the goal in only two days.
    • Best Buy, which spent months testing curbside delivery at a handful of stores, rolled it out in every store in two days.

There are many reasons for the short-term success. CEOs with whom we work asked if this was sustainable, and we brought to their attention that it might not for lots of reasons, including one underlying the “Hawthorne Effect”. Years ago, in a study on ways to increase productivity, everything that the researchers did to improve working conditions in a factory had a positive effect on worker productivity. Wondering how it could be so good, they then started removing them; productivity continued to increase, until the removal of extra and then normal lighting made the room so dark it all came to a screeching halt. Conclusion: people who know they are being watched and want to please the observers, will do what they can to impress them. 

In the short term, we’ve watched this happen. Juggling work and family conditions (e.g., support, schooling, etc.) is stressful, but short-term we mobilized to do it. Working conditions at home weren’t ideal (e.g., our “desk” was a table sticking out of a closet), but we adapted to the conditions. However as we start planning for the next set of months, it’ll be a different reality: we are no longer in the “fight-back” mode but in the “creating a new life mode”. We need more comfort, more support from other people, to make it through the next stage. Expect lots of changes in how we manage space, time, multiple business, family and personal goals during the intermediate stage.

Leaders with whom I work are focusing now on the long-term. We’re not going back to the pre-pandemic office situation. Company leaders are trying to figure out how to allow people to adapt to the new distributed workforce model. Spatially, it means working from home, office and pods on whatever basis makes sense for the person, customer, technology, etc. Studies show that the overwhelming majority of people do not want to work in an office full-time in the future, nor do they want to commute and travel for business when alternatives exist. The nature of business, family, personal expectations for life fulfilment are all playing a role in determining the after-the-pandemic world.

More important, we need to focus on long-term job satisfaction, professional growth, creativity and innovation. We need to adapt new models for increased collaboration between members of teams and teams-of-teams in a world of greater self-management and ongoing change. Steve Jobs’ last major accomplishment was leaving Apple with a new California campus designed to spur spontaneous encounters, and encourage collaboration, creativity and innovation. Shaped like a donut, people could bump-into-one-another on the way to common areas, and begin conversations that could generate new ideas, products and services.   Today’s work-from-home, ”Zoom to communicate” world, lacks that opportunity for spontaneous exchange and ideation – keys to innovation.  Long-term success depends on our ability to build structures that will address this issue.

What do you think we can do to ensure long-term success? Share your ideas!

What’s Your Company Culture?

Whatever your company culture was like before the pandemic, one result is that it may change.  With social distancing limiting room and building occupancy, workers reporting that they prefer not commuting to an office ever day of the week*, and companies reporting that, on average, workers have been more productive during lockdown than they were in the office, this is a chance to also improve on the culture.

Even before the pandemics, companies were moving from centralized offices (often accompanied by hierarchical command-and control (HCC) leadership style) to distributed workforces (e.g., outsourcing, gig-workers, etc.) and adopting a “network-teams” leadership style. (The latter combines the best of the Team-of-Teams approach popularized by General Stanley McCrystal and Holacracy which was adopted by Zappos.)

The system of work over the last 90 days wasn’t planned to maximize productivity, cultural relationships, etc. It came quickly and we all learned to turn out homes into an office and little by little use the tools we had (e.g. Zoom) to keep in touch with one another building on the culture we had.  However, as we commit to a new working style, we can commit to a culture that‘s most conductive to people’s professional and personal growth, as well as team effectiveness, while increasing productivity and profits.

Last year, the national Center for the Middle Market, in partnership with Grant Thornton and The Ohio State University identified seven cultural types and evaluated the performance of companies with each type.  Analyzing them will help your company intentionally design a culture most appropriate to the corporate and individual values, behaviors and attitudes within your firm.  They are:

  1. Customer-centric. This is a “customer-first” approach to business. Companies react quickly to changing needs of their customers.
  2. Innovative and Creative. Companies with this approach are looking for new ways to create value with new products, services, processes and channels.
  3. Risk-Averse. The message in these companies is “Don’t get it wrong; make sure you’re correct.” In a post-Covid world where change is taking place everywhere else, the feat may generate paralysis. 
  4. Great Place to Work. This is the employee-centric mentality that creates a stimulating environment for employees, so they grow professionally and personally, and are engaged in their work; they are connected to others through virtual happy hours, daily huddles, and other fun challenges.
  5. Continuous Improvement. Here the focus is on steady gains in customer offerings and processes. The goal is to get better – employees, processes, products, etc. – for an ongoing Competitive Advantage.
  6. Technically Oriented. The culture seeks the highest quality products and services through engineering of all kinds. Early in the lockdown, these companies led in the adoption of collaboration and other tech tools.
  7. Highly Efficient. This culture is focused on eliminating inefficiencies and staying lean. The culture communicates to everyone the importance of now wasting scarce resources.

What’s your current culture-type?  Why? What led to the development of that culture?  Remember, there is no ONE right answer for every company, even within the same industries. The difference in cultures is noticeable in the relative tradeoffs that we inevitably make. Do we stay later at work to make sure the client gets the project on time, or do we negotiate a delay in product delivery for employee-centric activities?

Now, re-imagine your company post-pandemic. Given the new nature of your business for clients and employees, which would be most effective in the future? Why? How do you transition from the old one to the new ones?

These are the questions you and your leadership team need to explore in order to pick the best possible culture for the post-pandemic, distributed workforce era. If you need help with this process, we can schedule a conversation; contact me at jerrycahn@presentationexcellencegroup.com or 800-493-1334.

Be Creative and Diversity Your Products

As the fallout of the pandemic forces you to rethink your product line and customer base, consider diversification as a solution.

Over the past few weeks, as restaurants have had to stop serving customers on premises, many have analyzed their strengths and weaknesses and concluded they could continue to service at least some customers by diversifying.  Many have shifted some resources to a new or enlarged pick-up service. Some have focused on serving their existing clients and local communities; others have targeted new groups, such as the health workers and other essential workers. In many cases, they’re doing good while doing well: they’re paying the workers to help prepare food they are donating.

Others are discovering new products or services they can offer. Several restaurants realized they had access to fresh produce and groceries that were in short supply in traditional stores. For instance, Panera Bread opened a Grocery-drive in service; it also introduced a month coffee service. Other companies have accessed their alcohol and fabric supply chains to provide hand sanitizers and protective gear. As I write this, one B2B specializing in competitive intelligence is considering how to take its enterprise level service offering, and diversity with a new SAAS service + consulting service to help small companies access their capabilities.

How innovative is your team? How can you diversify your product lines and/or serve a wider customer base by carefully taking stock of your competencies and capabilities and analyzing customer groups that are under-utilizing your services (including not at all!), and then inexpensively and quickly extending the business scope?  Share with us what you are doing through the pandemic lockdown and recovery, so we can share it with others!

Beware of Cognitive Biases

When it comes to innovation, we often think that the challenge is coming up with ideas. Greg Satell, in an article on Cognitive Biases, notes that what really kills innovation is “how to want to see problems and then protect our ideas by ignoring or explaining away facts that don’t fit the pattern.” He notes three such biases. See if any ring true for you.

1. Availability Bias

Coca Cola conducted extensive market testing to determine the viability of New Coke and when they concluded it would be a hit, they introduced it to the public – only to have I rejected. Why? The emotional ties that people had to the old formula were stronger than the new ones to the preferred tastes.

How did this expensive and embarrassing error occur? Psychologists call it the availability bias. We tend to base our judgments on the information that is most easily available, such as market testing taste, and neglect other factors that are harder to see, such as the emotional ties.

In Farsighted, Steven Johnson notes two techniques that can help overcome the bias. The first, called pre-mortems, asks you to imagine that the project has failed and figure out why it happened. The second, called red teaming requires that you set up an independent second team to find holes in the first team’s idea.

2. Confirmation Bias

As Daniel Kahneman noted in Thinking Fast and Slow, our brains are geared towards making quick judgments.  We tend to lock onto the first information set (called priming) which affects how we see subsequent data (framing), often regardless of its credibility. One we come to believe something, we will tend to look for information that confirms it and discount contrary evidence. We will also interpret new information differently according to our preexisting beliefs. When presented with a set of relatively ambiguous set of facts, we are likely to see them as supporting out position.

This plays out in the group setting in the form of conformity. Dissent and conflict are uncomfortable.  So, as Satell notes, if you were sitting in a New Coke planning meeting, would you have the courage to challenge the consensus view?

3. The Semmelweis Effect

In 1847, a young doctor named Ignaz Semmelweis, working in a maternity ward, discovered that a regime of hand washing dramatically lowered the incidence of childbed fever. Unfortunately, instead of being lauded for his accomplishment, he was castigated and considered a quack. The germ theory of disease hadn’t yet been accepted, so he attacked the establishment, rather than seek more confirming data.

The Semmelweis effect is the tendency for professionals to reject new knowledge that contradicts established beliefs that have served them well. In contrast, Jim Allison, who discovered cancer immunotherapy, initially found that pharmaceutical firms refused to invest in his idea. He fought back by collecting more data and convincing others with it. Unlike Semmelweis, who ended up dying in an insane asylum, Jim won the Nobel Prize.

What this means for you.

In any presentation of a new idea, you need to go beyond the current data-dump of information and dress it up to appear interesting to the audience. You need to identify the biases you might encounter with your audience, first, and then organize the presentation to overcome the biases that they will have.

The best way to do that is to get the perspectives of an outsider. Just as an “adjacent-outside expert” can help a negotiator be more effective (see prior blog), the presence of an “audience-driven presentation expert, can make all the difference between success and failure.

Share with us examples of how biases have impacted your investor, marketing, sales, and board presentations.

7 Ways to Avoid Common Entrepreneurial Mistakes

We usually think of entrepreneurs as being young adults (e.g., 20-30). In fact, the Kauffman Foundation tracks entrepreneurship, and finds that the largest cohort is older adults approaching traditional retirement age. (Not surprising, when you realize that many are SharExers, people who like to share their experiences and expertise, have identified market needs, and have the time and resources to start a company.)

Regardless of your age, as a rookie, there are mistakes entrepreneurs are likely to make. Arlen Meyers shared some in “Business Model Rookie Mistakes”. Here are a few mistakes that you want to avoid:

  • Going after too many customer segments
  • Defining an industry segment, not a customer archetype or persona that you can clearly identify
  • Creating a value proposition that focuses on features and technology, not benefits for specific  personas
  • Not quantifying the customer pain and what they would be willing to pay to get rid of it
  • Grossly underestimating the barriers to adoption and penetration and the journey needed to go from early adopters to mass usage.
  • Not appreciating the cost of customer acquisition in each market, particularly when there are incumbents
  • Not planning on how to keep and grow customers once you get them

He notes that you also have to address your own role as the company scales up. As the company evolves, you need to work on the business, not just in it, or you become the bottleneck to growth.  That means planning for plateaus where you can turn to new hiring, outsourcing, automation, new distribution channels, etc. which will support the larger company.

One way to help avoid such mistakes is to become part of a peer-advisory-group of other company leaders, and use a network of professionals to ensure use of resources. Consider Vistage Worldwide, where new members grow 2-3 faster than their competitors because they seek out ways to avoid being blindsided and making mistakes.  See Vi-NY.com for more information.

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