Leadership Quote: Success Or Significance?

Opt 4 Aug 31

This month’s leadership quote:

“Success is when you add value to yourself.  Significance is when you add value to others”

-John Maxwell

I have heard it said, that the time to “give back” is in the later phase of our lives. This quote is a reminder that giving back is really a lifelong habit; a habit of giving. As I think about people who have made an impact on me and on our society, they are remembered because of the value they added. It’s one thing to build a successful enterprise or career and another to achieve significance.

Which do you want?

Elisa K. Spain

The Unrecognized Value of Operational Excellence

Opt 9 Aug 24

Strategy and sales are the key to success, right? Well, yes, and no. Yes, they are important and without execution and operational excellence, they don’t matter. As Thomas Edison said so well, vision w/o execution is hallucination. 

So how do we get there? The DIME Method (Design, Implement, Monitor & Evaluate)  is a start. And, it’s the M & the E that get you to that operational excellence and where governance comes in.

It starts with figuring out what to monitor and keeping it simple, and then circling back and evaluating progress and measurements, making Design adjustments, Implementing those changes and starting the Monitor and Evaluate process again.

The successful CEOs I work with that have achieved operational excellence consistently follow these three key actions:

  • They identify the 3-5 key measures of success and monitor those daily, these could be sales calls, throughput, rework; what to watch depends on their business
  • They act when the the key measures indicate a variance, and they don’t wait and don’t accept excuses
  • They have a culture of co-accountability; their team holds each other accountable for the results they agree to

And,  they design compensation plans that are consistent with the results they want, e.g. if net income is the goal, the leadership team is ‘bonused’ (deferred or current) on results, and they work together to get to those results.

Elisa K. Spain

Caution… You are Entering Your Comfort Zone

Comfort Zone

The difference between a good leader and a great leader is the ability to improvise and gently push people out of their comfort zone, so says Vistage Speaker Michael Allosso.

In this TED talk, Charlie Todd helps us see the human connection that results from a shared experience — in this case, an absurd shared experience, one that takes us out of our comfort zone.

Vistage members also have shared experiences; in our case, these happen every month. As the chair and leadership coach, I regularly see the human connection that results.

I wonder about the following:

  • Is it incumbent upon as leaders to search for opportunities to create shared experiences in our companies?
  • What great things can we accomplish in our companies by pushing people out of their comfort zone and introducing more intentional and improvised shared experiences?
  • And by making this push, are we fulfilling a key component of our governance responsibility?

 

Elisa K. Spain

 

 

 

 

 

 

 

Are You Prepared To Govern In A Changing World?

Opt 1 Aug 10

Arguably the most important ingredient is good governance is having a vision and a strategic plan. I often notice that these plans are based primarily on what is within our control. In short, these plans often consider only internal factors, the SW of the traditional SWOT analysis, while ignoring the OT portion or external factors.

And, I find these same companies are excellent at identifying their weakness and occasionally good at identifying their strengths and true competitive advantages.

I have had the privilege to work with several successful companies and I find, despite their success, they enjoy telling me everything they could be doing better. It is only when I hear them talking with customers, or preparing for these customer conversations that I hear their strengths. In the category of “only the paranoid survive” (Andrew Grove), perhaps this focus on what we can do better leads to stellar results. I certainly can’t argue that in these companies, it certainly has.

And.. what I also notice, in the few consistently high performing companies, is they are equally paranoid about their external environment, not just what their competitors are doing but also regulatory changes, environmental changes, technology changes, etc. They consider all factors that present both opportunities and threats to their current strategies.

It is these companies that focus externally that truly innovate and maintain consistent results.  And effective governance requires this external focus. Without it, sustainability is a question. With this in mind, as you begin to consider your plans for 2015, I ask you to consider the following questions:

  • When was the last time I visited a customer just to understand more about their business? Is it time?
  • What changes are happening in my industry – new technology, consolidation, regulation, etc.?
  • What is happening in other industries, perhaps ones more/less mature than mine, that I can learn from?
  • How are the demographics of my customer base changing?
  • How might all of these changes present both opportunities and threats as we plan for the next 3-5 years?

Elisa K. Spain

 

 

If You Don't Watch the Numbers, You Don't Have Governance

Opt 4 Aug 3

Publicly held  U.S. company governance dictates the requirements for financial reporting and many of these companies give “guidance” as frequently as quarterly. While this approach is sometime criticized as being short-term focused, the important upside is all stakeholders know, at any given time, how the company is performing and can respond accordingly.

Privately held companies, on the other hand, have a choice. There aren’t any governance mandates.

  • They can choose to focus on the numbers, or not
  • They can choose to report performance to all stakeholders, or not, and
  • They can choose to forecast and adjust accordingly or not

Owners sometimes question the need for forecasts and state that sales focus is primary.  After all they say, isn’t it all about growth, i.e. how much we sell this year compared to last year?

While most awards for privately held companies focus on top line (Inc. 500/5000, Crain’s Fast Fifty, etc.),  in my experience the businesses that follow the following five tenets, are the ones that achieve sustainable growth.  And for my Vistage CEO’s it is the reason members voluntarily report their financials quarterly, are accountable to each other for providing guidance, and adjust their actions accordingly.

Five Truths of Profitable GrowthTM

  • If you don’t know how you make money, you won’t make money.
  • If you don’t set goals for wealth creation, you won’t accumulate wealth.
  • Operating budgets and capital budgets are not the same; if you use debt to finance operating expense rather than for growth, you will not grow.
  • Top line growth does not equal bottom line growth.
  • Without a culture of accountability and measurement, you will underperform.

Elisa K. Spain