How to successfully manage business mergers: Lessons from PwC

Between 70% to 90% of mergers and acquisitions will ultimately fail. Managing a business merger requires a delicate and experienced hand. Not only do you need to consider the direction and fundamentals of both organisations, but you also need to consider culture, strategy, and vision. Mergers tend to be particularly hard on staff members, both because it is a tumultuous time and because the future may feel uncertain — and this is where true leadership becomes essential.

Here’s how Rob Ashley, advisory principal with PricewaterhouseCoopers and a member of TEC, has been able to counter these challenges and achieve tremendous success.

Understand the importance of decision-making

A business, at its core, is really just a series of decisions. Not every decision must be perfect — what is important is that the decision is made. It’s estimated that the average adult makes approximately 35,000 decisions per day, and each of these decisions carry with them consequences and direction.

Business owners will be called upon to make a tremendous number of decisions throughout the business acquisitions process. These range from the dissolution of certain corporate assets to the retention of human resources. Each of these decisions impact the business itself, its employees, and its clientele. And with thousands upon thousands of decisions occurring, it’s important that a leader not get bogged down.

Rob Ashley was able to create a comprehensive planning process, which covered both an internal focus on the organisation and an external client engagement strategy. Through this planning process, Ashley was able to control all elements of the merger and facilitate decision-making processes. Though not every decision may have been perfect, they were made quickly and competently, running like a well-oiled machine.

Alignment of strategy

Why do mergers so frequently fail? If it was just about financial due diligence, one would expect most business mergers to be a success. But businesses are more than just what they appear to be on paper: they are a collection of strategies and goals. A business has its own direction and culture, and compatibility is very important. When polled, 33% to 50% of respondents cited cultural differences as the leading issue with a merger.

When businesses are aligned in terms of strategies, goals, and culture, they can readily work towards a singular destination. When businesses are not aligned, they begin to pull apart at the seams — and it is the human element that is lost. Companies need to be prepared to align their goals in terms of their values and their client base if they are to work together.

Recognising this, Rob Ashley placed a premium on communication and collaboration. He understood the need to engage staff members of both teams, alongside their client base, and to ensure that everyone involved was working together towards the same goals.

Maintain a consistency of service

Most mergers will lead to an increase in services. But though this may sound like a benefit, it can actually be detrimental. Ultimately, it will lead to the dilution of the company’s branding. In order to support a company culture and the comfort of both employees and clientele, it’s important to maintain consistency of service. That means that as services are added, they also need to be folded into the new company mission that both businesses now share.

In order to improve upon employee alignment, maintain happiness, and motivate employees, it is necessary to ensure that as much of the business as possible remain consistent. But it’s also important not to overestimate the value of synergies; 70% of business mergers overestimate the amount of revenue synergy they can expect.

Rob Ashley found that the increase in services was not only a benefit to the company’s clientele, but also the company’s own access to their now expanded talent pool. At the same time, conscientious work had to be done to ensure that the company’s offerings remained consistent with its mission statement and that the value of these benefits was not overestimated.

Enhance your personal life

As exciting as a merger may be, it is equally mentally and emotionally taxing. As a leader, it’s easy to become absorbed by your work and lose touch with the outside world. Though you may not feel it, those around you do; everything you do affects your end work product. Diet, sleep, and exercise can all have an adverse impact on your decision-making skills. You are the foundation of your brand — and because of this, you need to take care of yourself first.

Harvard Business Review explored why good leaders can sometimes make bad decisions. HBR found that bad judgments often occur due to red flag conditions, such as ‘the presence of inappropriate self-interest’, ‘the presence of distorting attachments’, and the ‘presence of misleading memories’. All of these are emotionally influenced conditions that can occur when mood is not properly managed.

As an experienced business professional, Rob Ashley realised that his personal health and mood could impact the way that he handled his merger. So Rob Ashley sought TEC. Since joining TEC, Rob Ashley was able to find a community of like-minded people that he could connect with.

Managing mergers successfully

Mergers and acquisitions involve a lot of moving parts. Decision-making, strategies, services, and even your personal health all need to be combined into a sum that is greater than each part. When anything is out of sync, things can fall apart — and they often do. But your business doesn’t have to be one of the 90% of businesses that fail through a merger; it can be one of the 10% that ascends to far greater heights. All you need to do is be able to properly manage those four key aspects of the transition.

Managing mergers is not a skill that you can develop overnight. It’s something that requires experience, expertise, and guidance. If you want to learn more about how businesses such as PricewaterhouseCoopers (and experts such as Rob Ashley) have been able to build their vision and grow, get in touch with TEC today.

 

 

Are you a manager or a leader? Three essential lessons from Inspire CA

A manager is someone who does exactly that — manages. They’re the people who give employees direction when they come to work every day. They answer questions, offer guidance and provide insights to help staff achieve goals.

A leader, on the other hand, is someone different. Someone who is inspirational, passionate, innovative and empathetic. A leader is someone that encourages their staff to challenge the status quo, come up with their own solutions, problem-solve and work towards their goals.

Ben Walker is someone who knows a thing or two about just how important leadership can be. As the director of Inspire CA, Ben founded the company himself in 2013 at the young age of 22. After many years of working within the boundaries of a traditional accounting firm, Ben began looking for newer and more innovative ways in which he could serve his clients. That was how Inspire CA was born. Because Ben’s instinct to do more than just manage was and will always be a powerful one. Something that cannot be contained or restricted.

As you move throughout your own career, it’s important to come up with a definitive answer to that very question: ‘Are you a manager or are you a leader?’ If you fall into the former category and want to do whatever it takes to move into the latter, there are a few essential things to keep in mind.

Defining one’s leadership style

The most important thing to understand is that there is no ‘one size fits all’ approach to leadership. Different situations require different leadership styles, as a business is essentially a living, breathing whole that needs to be nurtured in its own unique ways. Remember that 46% of all startups fail due to general incompetence in leadership — meaning, people are trying to manage in a situation where something more is required.

There are a few different leadership styles for you to choose from depending on your needs:

• Facilitative leadership is a people-centric approach to leadership. It puts the work process and the company culture first, which is ideal for environments that are both creative and high-pressure.

• Laissez-faire leadership, on the other hand, is a more ‘hands-off’ style. It puts the members of a particular team in control of their own destiny, ideal for exceptional employees and teams that excel in self-motivation.

• Coaching leadership fosters a much more ‘give and take’ atmosphere. It puts a heavy emphasis on two-way communication, ideal for individual development long-term.

• Authoritative leadership is essentially the business version of a dictatorship. The leader is in complete control, which is great for undisciplined environments.

• Democratic leadership is all about the free exchange of ideas, perfect for a balanced working environment.

When learning how to lead Inspire CA, Ben Walker also had to learn how to think outside the box. He had to adapt his leadership style to implement new technologies to change the way the business communicated with its clients. During this process, he learned exactly how difficult leadership could be — particularly when you’re trying to control too many things. On the ‘leader vs manager’ scale, Ben started out a manager. The situation demanded that he became a leader, sooner rather than later.

Build that management team

It’s also important to understand that a leader is nothing without a strong management team by their side. In fact, according to one study, only about 2.5% of companies successfully complete 100% of their projects. The average cost overrun of all projects is about 27%. 57% of all projects that fail do so because of a substantial breakdown in communications.

What does this tell you? Simple — you could be the best leader in the world, but without the right management team at your side, you may well be finished before you ever had a chance to truly start.
Nobody can run a business single-handedly, which is why communication with your management team is so important. But this is about more than just making sure everyone is on the same page — it’s about the free exchange of ideas that lets everyone operate at their best at all times.

In those terms, The Executive Connection was instrumental in helping Ben Walker understand the importance of a team to assist the leader. Leaders may be the captains of their ships — but they’re not the ones down in the engine room stoking the fire. They not people whom they can trust to help make that happen.

All focus, all the time

When you’re starting (and eventually running) a small- to medium-sized business, every day is a new challenge. You invariably meet a lot of different obstacles that don’t just test your resolve — they also start forcing you to question whether you’re on the right path in life in the first place.

How common is this idea in terms of leadership? More common than you probably think. According to a study conducted by the Small Business Administration, about 1/3 of businesses that begin today will fail within the first two years. Of those that remain, another 50% will fail over the course of the next five. Not knowing what to focus on and when and why are major contributors to this.

Being a part of TEC helped Ben Walker not only learn how to become a better leader, but also underline the importance of focus. TEC helped Ben gain insight into not just that focus was important, but what he needed to be focusing on: namely, developing his business, his leadership skills, and his team.

Taking leadership to the next level

There is nothing wrong with being a manager. Managers are an essential part of any business. But to really take your own development to the next level — to become the best possible version of yourself you can be — you need to learn how to think, eat, sleep, and breathe like the leader you’ve always dreamed of becoming.

Leaders don’t just know how to adapt their own style to fit the needs of the situation. They know how to surround themselves with the best possible people and maintain the type of hyper vigilant focus that allows everyone to do better. They’re masters of the approach of putting the pieces in place to turn a business into the well-oiled machine it was meant to be.

If you’d like to find out more information about building leadership skills, or if you have any additional questions on related topics that you’d like to see answered, please don’t delay — contact TEC today.

4 Insights into what great CEOs do differently

When less-than-optimal leadership costs businesses as much as 7% of total sales each year — what’s the difference between a good CEO and a great CEO? A good CEO is an important part of any successful business. A great CEO, on the other hand, doesn’t just lead — they inspire and contribute to an impactful business.

Here are the four key traits in particular that separate the good CEOs from the great ones. 87% of professional leaders, who either become or aspire to one day to become a CEO, deliberately develop the following four qualities. They may seem simple, but the key lies in the consistency of application that delivers the best results time and again.

1. Great CEOs make decisions with conviction

A great CEO understands that more often than not, it’s not about making the best decision possible — it’s about being decisive with conviction. It’s less about making the perfect decision and more about making decisions when they’re needed and acting without doubt.

A common trait among CEOs with the highest IQ is that they often struggle with making fast decisions as they’re much more likely to weigh the pros and cons of every situation. This leads to indecision and ambiguity, which invariably creates a bottleneck.

Great CEOs know that the expectation of ‘perfect information’ is an unrealistic one on the best of days; you need to make decisions quickly with conviction. If any signs of doubt are exhibited, employees will quickly start to lose faith in their leaders.

2. Great CEOs know how to measure impact

Regardless of the business you’re running or even in the industry you’re operating in, success more often than not comes down to your ability to deliver results. A great CEO never focuses too much on their vision without understanding the precise impact of that vision and which metrics will ultimately be used to measure its success.

To that end, it should come as no surprise that CEOs who are deftly able to engage their stakeholders’ needs are 75% more successful in their role than those who aren’t.

To be a great CEO, you need to be aware of not just the impact of what you want delivered — but also the impact you’re making when you deliver the results or engage with the people who have a stake in the game.

This idea even plays a role in how you interact with people on a daily basis. Remember that employees will always magnify your reactions. If you grimace when someone is telling you their ‘next big idea’, they might immediately think you hate it — or worse, think they’re being fired.

Along the same lines, good CEOs will allow employees to vote in the direction of the company. Great CEOs will allow them to have a true voice in the matter, albeit with the understanding that the consensus-driven decision is not necessarily the one that will be made. Knowing how to measure impact — in this case, the difference between listening to the input of employees because you’re afraid of being disliked versus making an unpopular move because you know it’s the best one — is something you’ll need to focus on if you want to move up to ‘great CEO’ status.

3. Great CEOs adapt proactively

Everything about your business is changing regularly — from the marketplace you’re trying to serve to your industry to your organisation at a basic level. CEOs who are able to adapt to changing times and evolving needs are roughly 6.7 times more likely to succeed than those who do not.

For a great CEO, adapting proactively is less about being able to successfully handle today’s challenges and more about dividing your attention between short and long-term thinking. Devoting as much of your time as possible to thinking about the long-term direction of things makes it easier for you to not only recognise signs of change and mitigate risks ahead of time, but it also creates a business that operates with a growth mindset as well.

4. Great CEOs deliver reliably

Good CEOs make promises. Great CEOs keep them.

To be a great CEO, you need to demonstrate results. This means that you need to show you cannot only recognise what needs to be done to move a business forward, but actually do it. It should come as no surprise that CEO candidates who are twice as likely to deliver results than average are much more likely to actually be picked for that role.

To get better at this, learn how to set realistic expectations upfront. Focus on establishing business management systems including dashboards, accountability, performance monitoring, and more. All of this allows you to build a much more stable bridge between where you are today and what you promised you would do tomorrow.

One of the major reasons that CEOs sometimes don’t deliver expected results is because they don’t have the tools in place when they need them the most. In fact, 60% of CEOs make the rookie mistake of not having the right team in place quickly enough. Words are cheap — actions are more expensive. From the business management solutions you employ to the teams you surround yourself with, all of this helps you deliver what you need, when you need it, no exceptions.

From good to great

The fact of the matter is that the gap between a good CEO and a great one is often created less as a result of any one major move and more because of a series of small ones. Knowing how to make decisions with conviction, knowing how to measure the impact of actions both large and small, being able to adapt to a naturally fluid environment, and knowing how to deliver what you promised are all major leadership traits that you should be focused on.

If you’d like to find out more information about the major qualities of a great CEO, or if you’d like to learn more about similar leadership insight topics, please don’t hesitate to contact us today. 

 

5 Leadership styles and when to apply them

An effective leader motivates and guides employees, targeting their strengths and weaknesses so that both the employees and the organisation can succeed. The relationship between leadership styles and employees, therefore, plays a crucial role. Despite of this, surveys have shown that 75% of employees voluntarily leaving their positions leave because of their bosses, leading directly to issues of talent retention and churn.

Surprisingly, 36% of organisations don’t have a formal leadership development strategy — considering that to be a good and effective leader, one needs to be highly adaptable. Depending on a project, the environment, and even the psychology of the employee involved, leaders may find themselves switching between leadership styles quite frequently.

It all starts with a solid knowledge of the five major leadership styles.

Facilitative leadership

Facilitative leadership is a people-centric leadership style that puts the work process and company culture first, ideal for creative and high-pressure environments.

A facilitative leader works to build trusting relationships between leaders and employees in order to achieve their mutual goals. Facilitative leaders learn as much as they can about their employees and how they work, give clear expectations of their employees, and encourage them as they achieve these goals. Facilitative leaders are positive and motivational.

Ideally, employees should feel that they are valued and that their work matters; they should feel as though they are being listened to and that they know what to expect.

Facilitative leadership is often used best within creative and skill-based industries, in which a more rigorous or structured type of leadership style could lead to roadblocks and stress. Facilitative leadership puts people first and thus ties very strongly into people-first company cultures. It is best used when employees are already invested in producing the best work that they can for the organisation.
 

Laissez-faire leadership

Laissez-faire leadership is a hands-off leadership style that puts all members of the team in control, ideal for exceptional employees and self-motivated teams.

In a laissez-faire leadership, a leader provides very little guidance to their team. Instead, they trust that their team understands their own roles and will be able to perform their best. Statistically, laissez-faire leadership is often considered to be the least productive type of leadership — but this is usually when it is improperly applied. When applied correctly, laissez-faire leadership actually reduces much of the red tape surrounding organisational administration and can produce very rapid and effective results.

A tightly connected team full of self-starters may thrive under laissez-faire leadership. All individuals need to be personally motivated and highly competent. Laissez-faire leadership is best used when each individual member has an expertise and skill set that the leader themselves may not necessarily grasp. In this situation, over-managing employees could become more disruptive than helpful.

 

Coaching leadership

Coaching leadership creates a give-and-take atmosphere that puts a heavy emphasis on two-way communication, ideal for developing long-term and stable communication.

Sports teams are an excellent example of how a well-balanced coaching leadership style is put into effect. In a coaching leadership, the leader sets out clear goals and responsibilities for their team. However, the leader also listens to their team and provides constant communication. Leaders will provide feedback regarding an employee’s role and accomplishments and will listen to any concerns that employee has. This fosters a very strong employee-and-leader relationship, which is more likely to yield stable and consistent results.

When competent and capable employees don’t seem to be giving their job the attention that’s needed, a coaching leadership can be used to delve into their psychology and to inspire and motivate. Coaching leaderships drill down to any potential issues within a team and inspire the team to work together. They are best used to develop long-term team structures and goals.

 

Authoritative leadership

Authoritative leadership is essentially a dictatorship that puts the leader in complete control, ideal for undisciplined or high-stakes environments.

Authoritative leadership is one of the least preferred by employees, but nevertheless, it can become necessary in a variety of situations. In authoritative leadership, a leader makes all the decisions and rarely considers the opinions of team members. Team members may rebel against this type of leadership style unless they feel that the consequences of rebellion outweigh the benefits. All the team’s goals, initiatives, and strategies will be developed solely by the team leader, with very little input. The psychology of authoritative leadership can be a bit rough, with employees feeling devalued and ignored.

Though it may sound like a bleak atmosphere, authoritative leadership can become necessary when there has been a complete breakdown in structure. During times of transition or crisis, an authoritative leadership style may be necessary to make rapid-fire decisions and to keep a team together. Authoritative leadership is generally not intended for long-term use but instead as a short-term tool.

 

Democratic leadership

Democratic leadership is a type of leadership that puts an emphasis on the free exchange of ideas, ideal for most balanced working environments.

This is one of the most versatile types of leadership style. In a democratic leadership, team members are consulted regarding major decisions and projects. Communication consistently occurs between leaders and team members, and input from every individual is considered valuable.

Many teams have a tendency to default to some form of democratic leadership policy. However, it isn’t without its flaws: a democratic leadership process does take longer, and projects and teams can be stalled by a weak link.

Democratic leadership works best in strong, homogenous teams of accomplished and competent individuals. This is a solid ‘default’ leadership style, though it is particularly useful when time is not at a premium. It may need to be abandoned in times of crisis or looming deadlines.

 

All about the balance

There is no one leadership style that is going to carry you through all the teams, projects, and environments that you will encounter. Instead, the ability to effortlessly switch between these leadership styles as necessary is what makes for an effective leader. A business with satisfied and motivated employees will be able to retain the best talent and experience limited churn.

But merely knowing about these leadership styles is not enough: you also need to be trained in them. Contact TEC today to get started.

A guide to company culture from 5 successful businesses

Developing a strong sense of company culture pays off. Employees who are happy are up to 12% more productive than average workers, able to outperform their peers and consistently improve an organisation’s revenue. A strong company culture means retaining your employees, spending less time training, and being able to procure the top talent. Here are some fantastic examples of companies that were able to create and maintain a strong foundation that truly resonated with their employees.

Find out more about a TEC membership and how it can help you make an impact on your company culture

 

Create an environment that you’d like to work in at Envato

 

Named one of BRW’s Best Places to Work in 2015 and JobAdvisor’s Coolest Tech Company in Australia in 2014, employees of Envato are the envy of many.

Envato’s founders had a single goal in mind when they developed their company culture: to create a business that they themselves would like to work in. After all, they knew that to get the best work out of them, employees had to have mutual respect for each other as individuals. Envato presently has around 260 employees, and their major marketplace, ThemeForest, is the 204th most visited website in the world. They have been able to achieve their sterling reputation and incredible growth through the allowance of flexible benefits — such as allowing their staff to work anywhere in the world for up to three months. They have also emphasised gender diversity internally. In 2015, Envato was named the Coolest Company for Women by JobAdvisor.

What does this all mean? Envato can get the pick of the litter when it comes to tech employees — especially female employees.


Be honest and blunt at
Atlassian

Values are the foundation of Atlassian’s company culture, which acknowledges the humanity and complexity of both their employees and their customers.

Atlassian’s blunt and honest company creed sets the stage for the rest of its edicts: build with heart and balance, play as a team, and be the change you seek. This direct, forthcoming company culture is what makes Atlassian a refreshing business for employees — and customers. Atlassian’s company culture includes twice-daily workout sessions, which are designed to bring the employees together and acknowledge that life is about more than just work product. But at its core, the company culture is about working together to deliver the best product possible and being proud of that work. This company culture supports the idea of mavericks and innovators while also emphasizing the need for teamwork.

By creating a blunt atmosphere, Atlassian is able to improve communication among its personnel. A focus towards delivering the best product at any cost removes focus from mundane, day-to-day conflicts and truly inspires their employees to innovate.

 

Turn work into a party at RedBalloon

When RedBalloon was first launched ten years ago, it was just a one-person startup; now it’s one of BRW’s “Great Places to Work.”

An online experience-based gift retailer, RedBalloon wants to bring its gifts and happiness to its employees as well. RedBalloon’s company culture concentrates primarily on developing an employee experience rather than using employees as company resources. The founder, Naomi Simson, wanted her employees to have a good time in their workplace, trusting that if they do, they will remain loyal and productive. The process of maintaining this company culture begins as early as interviewing. Quirky group interviews make sure that everyone who comes on board is part of the same healthy dynamic. The company culture is then reinforced through engaging, bonding activities, ranging from a comprehensive wellness program to optional charity hours. Through this, RedBalloon is able to maintain its work ethic without sacrificing productivity.

When employees want to work, they stay at their job. By creating this atmosphere, RedBalloon is able to reduce employee churn and the amount of time they spend during the hiring process and training.

Just be human at Vinomofo

With a tradition of calling its employees “mofos” and “mofettes,” Vinomofo has been a unique and innovative company from the start.

Today, Vinomofo sells 3.5 million bottles of wine annually, with approximately 100 employees. They’ve been able to achieve this steady and impressive growth by creating a company that is about more than just profit. Vinomofo has a wide variety of Mofo Causes, designed to give back to the community for everything from animal welfare to depression awareness. And every month, Vinomofo recognises people within the community who are doing good work. Like RedBalloon, a lot of attention is paid to new hires to ensure that they fit in with the existing company culture. A major creed at Vinomofo is to “be human” so that the distractions of the workplace don’t get in the way of recognising employees as people.

Vinomofo didn’t want to forget its employees’ humanity — and it paid off. By treating employees as people, companies can ensure that their employees truly give their work their all. This can be easily seen in the productivity Vinomofo is able to establish with just a hundred employees.

Don’t be evil with Google

Google has distilled company culture down to a science, becoming the topic of dozens of research papers and studies unto itself.

“Don’t be evil” has been Google’s motto for many years — and it’s one of the reasons this monolithic tech giant is often still considered to be one of the friendliest and most approachable businesses. Google has always been lauded for its relaxed atmosphere and company culture, which includes being able to bring in dogs, working on flex time, and devoting significant portions of one’s day to one’s own projects. Google has remained one of the “Best Companies to Work For” on Fortune 100’s list year after year, and in large part, this is due to its unique benefits, sterling reputation, and carefully crafted culture.

Google’s reputation has made it possible for it to truly select from the best-of-the-best tech employees — and that’s what has kept it on top.

Culture is impactful

Company culture is inherent to a company’s success. Not only does it improve revenue and productivity, it also ensures that any business you start is a business that you also want to continue working with. But developing a company culture certainly isn’t easy: it has to be motivated from the ground up, beginning with new hires and continuing on through the upper echelons of management.

At TEC, we’re focused on helping our members grow as leaders. If you’d like to find out more, contact us today to learn more about creating a company culture that will have employees clamouring for a position in your business.

 

Posted in TEC

How important is emotional intelligence in leadership?

Leadership isn’t just about IQ or technical skill – in fact, these are the entry-level requirements for executive positions. When 58% of all success in jobs are accounted for by emotional intelligence, it’s a clear sign that emotional intelligence has a vital role in the workplace. It has also been discovered that people with a high degree of emotional intelligence make an average of $29,000 more per year than people with lower degrees of emotional intelligence.

What is ’emotional intelligence’?

In the 1990’s, psychologist Daniel Goleman coined five main components of emotional intelligence that affect leadership:

1. Self-Awareness
Self-aware leaders have a clear picture of their strengths and weaknesses. This skill also allows them to be aware of how they’re perceived by others. Having this knowledge, better equips them to respond in a way that delivers the results they need.

2. Self-Regulation
Self-regulation allows leaders to control their emotions when making decisions or responding to certain situations. Leaders with self-regulation rarely verbally attack others; make rash decisions or compromise core values.

3. Self-Motivation
Motivation is passion that goes beyond the material of money and status. This is about being fundamentally driven by a purpose deeper than something that might not last. Self-motivated leaders consistently work towards their goal with a high standard for the work they produce.

4. Empathy
Leaders lead people. Empathy is the ability to successfully manage a team of people by understanding their drivers and emotions. It’s through empathy, that a leader can help develop the people on their team, challenge them and give constructive feedback.

5. Social Skills
Social skills relate to conflict resolution, communication skills as well as forging strong relationships with others. Leaders with strong social skills are good at managing change and set an example to others with their behaviour.

Aside from these five core characteristics, there is also: charisma, confidence, the managing of relationships, and the regulating of one’s own expectations. These all fall under the banner of emotional intelligence. To be truly inspiring and memorable, a leader has to be able to display these characteristics.

How Jeff Bezos (Amazon) displays emotional intelligence

In 2015, Amazon found itself in the cross hairs of The New York Times, following the publishing of a lengthy critique about its rigorous employee standards and harsh working environment. It may have gone even further, if it wasn’t for the swift intervention of CEO Jeff Bezos.

Jeff Bezos was able to use the opportunity to turn the criticism around, by announcing changes within the company and directly addressing the concerns that had been raised. Rather than fighting the claims, he leaned in, and was able to deliver the changes that his employees and the public desired.

How Larry Page and Sergey Brin (Google) display emotional intelligence

 One of the best examples of overall emotional intelligence comes from Larry Page and Sergey Brin, the two initial founders of Google. Now one of the largest organisations in the entire world, Google still reflects the atmosphere of a spunky start-up. Much of this has to do with their emotional intelligence. As a business grows, it’s often normal for the culture to dilute or change radically. It’s only through emotional intelligence – an understanding of the drivers of their employees, of the context of the business – that Google has been able to retain their playful company culture.

Well-known for their corporate code of conduct, “Don’t be evil” Google has developed an entrenched reputation as a well-meaning and forward-thinking corporate entity. The success behind their strategic initiatives also relates back to the emotional intelligence of their executive team and their ability to be ‘ahead of the curve’.

(Since the inception of Alphabet, Google’s motto has been replaced by “Do the right thing.”)

Do you possess emotional intelligence?

Emotional intelligence may very well be the line in the sand that separates a “boss” from a true leader. Through emotional intelligence, CEOs and entrepreneurs are able to inspire confidence and motivate others to follow in their footsteps. And, just like any other skill, it can be learned.

With over 21,000 members, The Executive Connection has turned the development of emotional intelligence into a science. Contact us to find out more.

 

The guide to organisation structures (flat vs hierarchical)

Is it time to redesign your organisational structure? Though many companies can benefit from a restructuring, fewer than a quarter of organisational redesigns actually succeed. But it doesn’t have to be this way. Organisations can undergo successful restructuring as long as they understand the differences between organisational structures (flat, hierarchical, matrix etc)— namely, their benefits and their drawbacks.

Why structure?

An organisation’s structure forms the very basis of its operations. Not only does it inform employees regarding who they answer to, but it also identifies core decision makers and defines the company culture. Without structure – even a loose structure – there can be no decision-making and no accountability.

However, the type of structure is often up for debate. Most businesses either operate on a flat structure or a hierarchical structure, depending on their needs.

Flat organisational structures

Flat organisational structures forego the concept of middle management entirely. Instead, staff members exist directly under executives, often working in teams rather than independently. Flat organisational structures may still include ‘team leaders,’ but these leaders will generally shift on a per project basis. During times of business growth, these teams may change substantially.

Ideally, a flat organisational structure is designed to empower individual staff members. As they must take on a greater role within the business, they become personally motivated to succeed. Without middle managers, there also exists no additional layer between the executive level and the staff level – making it easier to communicate and adapt.

Valve Corporation, a leading video game developer and digital distribution system, is one of the best-known examples of a large organisation that operates on the flat hierarchical model. Rather than assigning permanent managerial staff, Valve rotates its leaders on a per-project, per-team basis. Rather than creating permanent departments, Valve allows its employees to choose the type of work that they want to do.

With approximately 250 employees and an estimated worth of $2 to $4 billion, Valve is considered one of the most successful companies within its industry. CEO Gabe Newell reports that the company is more profitable per employee than either Google or Apple. At the same time, its flat management hierarchy has been the target of intense and widely publicised criticism in the past. It is also possible its structure is so successful because the company is comparatively small.

Many of the criticisms levied upon Valve are the same criticisms levied against flat organisational structures in general. Failing the development of an official management structure, an unofficial management structure will often arise. Instead of being told who to report to, employees may begin looking towards arbitrarily selected authorities for their cues. These authority figures are often selected due to their seniority or connections within the company, and may not necessarily be those best suited to the role.

Hierarchical organisational structures

In a hierarchical structure, an organisation is comprised of multiple layers. Every employee within the organisation answers to someone, with the CEO generally being at the very top. At the very bottom, entry-level staff members may answer to multiple managers, supervisors, and executives.

Hierarchical structures have several advantages. In a hierarchical structure, employees know where to look for in terms of direction and they know whom they report to. Employees can focus on simpler tasks, rather than having to self-motivate and self-organise. Employees also have something to work towards, as they may be able to climb the hierarchy in time. This type of organisation is highly structured, so that business growth provides very limited disruption.

With over 1.5 million employees in the United States alone, Walmart has been able to leverage its hierarchical structure to create consistency and efficiency throughout thousands of branches. At the bottom of the hierarchy are cashiers, stockers, and sales associates. At a level above them are customer service supervisors and merchandise supervisors.

These supervisors fall under a management trainee, which in turn falls under the assistant manager, co-manager, and general manager. On a regional level there will be a market manager, operations manager, or state general manager. And all of this falls under the existing executive-level hierarchy for the corporation itself.

It’s understandable that this type of organisational structure could be seen as quite unwieldy, especially for smaller businesses. A hierarchical structure is often slower to react and adapt than a flat structure, and departments are often forced to operate independently. The increased administrative time may also lead to substantially higher overhead.

Other types of organisational structures

Though flat and hierarchical organisational structures are the most popular, there are other alternatives. One such model is the “holacracy” model, developed by HolacracyOne, LLC and famously adopted by Zappos. Holacracy operates through teams rather than a management hierarchy, putting an emphasis on self-management on an individual level.

This model is designed to empower employees to advance their own goals in the ways that they see fit. However, with this much emphasis on personal responsibility and motivation, holacracy is a structural model that depends highly on the individuals within it.

What’s your structure?

What type of organisational structure does your business use? Is it as effective as you hoped? Organisation restructuring is common as a business goes through periods of growth. Often, when inefficiencies begin to arise in the usual business process, it’s time to reconsider how business-as-usual is run.

It’s important to note, however, that there isn’t a ‘perfect’ structure to fit each company. It’s about understanding your business strategy, the direction and the overall vision of your business. The structure chosen needs to be a cultural fit, but also allows facilitates the growth trajectory desired by the business.

If you’d like to learn more about organisational structures, or want to share your thoughts on this topic, contact us here.

Authentic leadership and what it means for culture

promote an authentic culture

Authentic leadership: An approach to leadership that emphasises building the leader’s legitimacy through honest relationships with followers which value their input and are built on an ethical foundation. Authentic leaders are positive people with truthful self-concepts who promote openness.

Authenticity has been at the centre of the leadership conversation for some time now. So much so, that the Harvard Business Review (HBR) dubbed it ‘the gold standard for leadership.’ However, HBR notes that when we simplify our understanding of authentic leadership we can reduce it to something that is counterproductive.

Yes, authenticity is about remaining true to yourself and your principles but it doesn’t mean a complete lack of growth. It means you will evolve and adapt new leadership skills and practices that are in-line with your core values – it’s a more authentic growth.

We know what authentic leadership is and what it is comprised of but we don’t always explore how it affects bigger picture items – namely culture. At the annual All TEC Day event this year, we had a chance to explore not just authenticity but its role in shaping culture and what this means for businesses.

How does it affect culture?

The short answer is that authentic leadership has a very strong positive effect on culture. When an organisation is led by a leader who not only talks the talk but walks the walk, the staff is more engaged and more creative.

Authentic leadership breeds an environment where people know they are empowered to take their own paths. When people are allowed to comfortably be themselves and work in their own ways they are more willing to go above and beyond the call of duty.

Think of it this way – are people more drawn to confident self-assured people or individuals who can’t quite find their footing? We’ve all had friends who are one way around you and then act completely different around others. It’s not an attractive energy.

When a business is run by a leader that is open, honest and strong in their convictions, the culture follows suit. Not only is the company stronger for this reason but it created an inherent competitive edge – no one can duplicate your unique brand of authenticity because they don’t have the same staff members with the same unique skill sets to create your particular flavour of success.

How do you consciously promote an authentic culture?

So, how can you consciously promote authenticity as a leader? It all starts with defining authenticity as a main pillar of your company culture. Be open and honest with your team about what authenticity looks like. Vocally encourage and praise out-of-the-box solutions to solidify that creative means are supported through your organisation. Instil accountability in your team, let them know how their individual position helps push the company’s bottom line forward. This kind of responsibility helps promote authentic investment in the business.

Above all else, trust your team. Authenticity stems from honesty and conviction. You cannot support an authentic culture without having complete faith in your team and their skills. Let them know you believe in their work and success will follow.

Leaders should aim to be the most authentic version of themselves when they are steering their organisation in any direction. When a company breeds this type of authenticity it allows people to remain true to themselves while working towards a common goal. Authentic leadership is the pathway to an authentic culture which ultimately leads to an engaged workforce and a successful business. This is the ideal pathway for success.


BHelen-Wisemany: TEC Chair, CEO mentor and coach Helen Wiseman

 

Planning your business strategy? Here are 4 tips for success

 strategy planning
A good strategy for your business is nothing without the people to put it into action. From yourself as a leader through your direct reports and onto the rest of an organisation, everyone contributes to the execution of strategy.

Often, recruitment and human resources demands will inform an integral part of a company’s strategy, so it’s important for leaders to understand where their talent gaps may be and how they can remain attractive for future employees.

  1. Understand your recruiting demands in advance

Ideally, you’ll be able to look at the strategy that’s guiding your business and know which positions you’ll need to start lining up candidates for. You need consider how your business might look in one, two and three years time and compare it with your current staff. Especially consider who has the potential to grow.

Building a succession plan to fill prospective gaps doesn’t just mean focusing on who you’ll have to hire. Take a look at which employees in your current staff can be developed to fill future roles as well. This will give you a better idea of which talent will come from internal sources and which you’ll need to recruit.

  1. Build a bench of possible candidates

Just like sports teams have a bench of substitutes ready to enter the fray if someone drops out, businesses can also benefit from having a list of possible candidates or other people in the industry they can tap on the shoulder when a vacancy opens up.

You can create a list yourself. Remember to also pick the brains of your team. But this is where a recruitment company can also be valuable, helping you to tap into a network of passive candidates and nurture them before you’re even exactly sure when you might have space for them. You will probably go broke if you use a recruiter to fill every position in your company, but recruiters see people you don’t and have good industry connections and candidate networks.

  1. Make your business attractive to candidates

Every part of your business has to be attractive to the talent you’re trying to appeal to. If you’re searching for people in areas with known skills shortages, any weak links will have an even greater impact.

It’s especially important to boost your digital presence, as the growth in online job advertisements means that people will be Googling you whilst applying for jobs. If your site looks out-of-date or is hard to navigate, it will send a strong message – and not a positive one.

You can also be active on social media to give a stronger impression of your role in the market. Many of the larger tech companies are masters of this. For example, a quick scroll through SAP’s Twitter feed makes it clear they’re an industry leader. This doesn’t mean you have to post about job opportunities all the time, simply communicating about your actions and achievements in your chosen industry can have a significant effect on how you’re perceived.

  1. Find out what current and future staff think about the business

You need varied and honest feedback to truly understand how other people – whether they’re former, current or potential employees – perceive your business. When people leave your business, it’s essential to use an “exit interview” to understand why. However, to get a more truthful answer, you may need to follow up a few months after they’ve departed, as this is generally when they’re more honest and open about their real motivations.

I also suggest that you get feedback on your current recruitment efforts. Ask people what they think about your website, your social media presence and anything else that could impact the way people think about your organisation.


Graham JenkinsBy: TEC Chair, CEO mentor and coach Graham Jenkins

 

The first steps you need to take for change management

Change management tips
Strategic planning objectives have to be about much more than the financial impacts and considerations. Often they depend as much on an organisation’s culture and leader as the amount of money they can put forward, an issue that becomes clear when we look at success rates for strategic initiatives.

According to The Katzenbach Center, just 54 per cent of change management initiatives are successful, a significant warning to those who approach the process with any degree of complacency. This is why I always reinforce to leaders that strategic initiatives are actually part of a much wider change management process.

  1. Prioritise the real issues

The top reason that these strategic initiatives fail can simply be put down to change fatigue. There are too many issues – all of which are considered important – and no obvious level of prioritisation for people to follow.

This is not just an issue for the CEO to keep on top of either, as simply dictating orders isn’t going to be enough to overcome the fatigue some people feel when they’re forced to continually evolve in the workplace.

  1. Communication doesn’t guarantee engagement

The value of communication to strategic initiatives can’t be overstated. Most people know that leaders communicate plans and objectives to foster engagement, but not all realise how far they’ve actually got to go to ensure their employees have a genuine connection to these messages.

It’s not enough to just think of communication initiatives and related rewards as the keys to engagement – it’s the culture that’s the most important. If leaders are embedded in the organisation’s culture and understand what it means to employees, they can make messages much stronger, and much more relatable. It’s a connection that’s essential to ensure everyone throughout an organisation buys into what a leader wants to achieve.

  1. Consider a change management team

For major projects, it might even be worth employing a change management team. That’s something that needs to happen at multiple levels of an organisation, and before anything actually begins to happen. Again, they have to be much more than just talk to ensure they actually make a difference for other members of the organisation.

Senior people, especially those in the change management team, need to very visibly act out the sort of change they want to see in an organisation. That has to flow down through an organisation too. While it can start with a CEO, middle managers also have to exhibit the same enthusiasm for these new initiatives. This links to the idea above of going a step further to ensure people are engaged. It’s not what leaders tell employees that makes a difference, but what they show them through their actions and behaviours.

  1. Don’t forget about human beings

It’s easy to get too caught up in the structural elements and implications of a strategic initiative and forget how important people and their emotional connection to the organisation are. It’s something I’ve seen in an organisation I work with that relies on the services of around 3,000 volunteers.

Volunteers show up because of their emotional connection to an organisation’s cause, so leaders need to buy into that to connect with the workforce and enact change. It’s a lesson that applies to paid staff as well, as their emotional connection to their role is just as important when leaders are trying to make major changes.


BRichard-Applebyy: TEC Chair, CEO mentor and coach Richard Appleby

4 ways to communicate your strategy more effectively

communicating strategy
Bringing people, strategy and finances together creates maximum value and momentum for any enterprise. However, it’s easy to get caught up in ‘business as usual’- fighting todays battles and focusing too much on the now, and not enough on the future. So what to do different and make that difference in trajectory?

  1. Business as usual- the quicksand of change

What I often find when a CEO presents a new strategy is that there are always new activities that staff have to undertake. Whether that’s new product updates or different ways to engage with clients, the result of a strategic planning exercise usually leads to people needing to do more work to take the business forward in a deeper or different direction – many of which fail as organisations do not have extra people, and nobody has extra time to dedicate to additional causes or tasks.

Avoiding falling into this hole is very difficult. The best way I know is to set up a limited number of initiatives with short deliverable times (like 90 days) and really break them down into chewable chunks which are then part of the ongoing weekly review

  1. Put it on the agenda- and follow up rigorously

You have to really hone your ability to bring all parts of an organisation and its workforce together. This might mean explicitly putting it on your agenda for weekly or monthly catch-ups with your team. Or, it could mean giving people tasks that will help them work towards these uniting goals. Get them to report back regularly so they can’t get lost under the excuses of ‘business as usual’.

This ongoing loop of meetings and feedback is the only way to actually get people and strategy to come to life and engage with each other. Once they’re engaged and invested in the process, it’s more likely to happen and harder for people to ignore.

  1. Be aware of the financial implications

A strategic initiative, no matter how much buy-in it has from other people in the business, isn’t effective without an understanding of the financial implications surrounding it. What will it cost? What are the budgets? What kind of return on investment can you expect from it?

Ultimately, everything we do within our businesses will be measured financially. In that respect, creating a strategic initiative that isn’t backed up by numbers or directed at a financial goal is all a bit meaningless.

  1. Work out how your strategy will cascade from employee to employee

Getting buy-in from a senior leadership team isn’t the difficult part of communicating a strategy; it’s ensuring you can get it to trickle down through the rest of the organisation that can be the real challenge.

Everyone involved in the creation of the strategy has to go back to their department and ensure their team is just as engaged and enthusiastic as they are about the plan and what they have to do. It’s about them replicating the same steps you put in place, such as scheduling updates and creating that feedback loop that keeps people accountable and reinforces just how important it is to work towards strategic goals.

Emotional intelligence and its role in strategic planning

Emotional intelligence
Strategic planning is planning to succeed. If you want to make success a reality for your business, it’s all down to how you implement the strategic initiatives. The true measure of a strategic plan’s strength is in how people engage with it and put it into practice.  Herein lies the biggest challenge of all and where I have seen so many leaders struggle.  It’s fact that’s led me to a certain maxim I live by in these cases: ‘the task is easy, it’s people who complicate things’.

You can never underestimate the ways people will complicate even the best laid plans, whether they mean to or not, which is why emotional intelligence (or EQ) is so important during the time of year when leaders are forming and implementing their strategies.

  1. You ignore the human factor at your absolute peril

As a coach, one of the queries I most get from other leaders is ‘how has my perfect plan gone so wrong?’. It’s often a case of simply not realising just how the human factors in an organisation can shape and evolve what people expected to happen in theory.

My favourite book on leadership explores this subject. The second chapter of Leadership on the Line by Ronald A. Heifetz and Marty Linsky notes that people – whether consciously or subconsciously – often resist change initiatives, which is why conversations around the importance of getting buy-in are so common.

  1. Understand how people resist change

The ways people can resist change within an organisation manifest in four different ways, so understanding what they are and how to detect them is essential when implementing a new strategy. The first three are:

  • Marginalisation
  • Diversion
  • Attacking

However, the one I feel is the most dangerous is referred to by Heifetz and Linksy as ‘the seduction of leadership’, where people give the appearance they’ve bought into the initiative and are happy to contribute but really couldn’t be more disconnected. Again, this can be subconscious behaviour, but unless you are sure you’ve got complete buy-in, your team could intentionally or unintentionally lead you down a blind alley and undermine what you’re trying to achieve.

  1. Don’t get stuck in one leadership style

Every leader has a particular style that most suits them, a default mode of operation that’s effective most of the time. Despite this, getting stuck in one style and not being able to adapt can reduce your ability to connect with all members in an organisation.

The leadership style that’s most effective during strategic planning is the one that best fits the team member you’re trying to influence. This is where emotional intelligence makes a difference, because if you’re trying to influence someone who’s an important gatekeeper, you have to understand their personality, their motivations and their context surrounding your goal.

Again, the most important element of all this is what they aren’t telling you. What’s beneath the surface that’s going to affect their motivations and potentially change the way they act with regard to upcoming changes?

  1. EQ tool for influencing change

Broadly speaking, the types of people you’ll be looking to influence will be split across four main groups. These aren’t hard and fast rules as such, but a quick and useful toolkit nonetheless that can help you decide how best to influence those on whom success of the strategic plan depends They are:

  • Results oriented – Their mantra will be ‘when do we start and get this done?’ – they’re the fast-paced, action-oriented doer in the organisation
  • Detail-focused – These people care about the ‘how‘ and want to make sure everything is covered and accounted for before moving forward
  • The big-picture strategist – They’re all about the ’why‘, and often think more about the higher level rather than getting stuck in the details.
  • The people-oriented person – Finally, these professionals are all about the “who”. They want to know how decisions might make them and the team feel.

It’s this level of awareness that can help you better apply emotional intelligence traits to your strategic planning process. Knowing your leadership style, and how that will resonate with those around you, is essential to keeping on top of the (very) human elements of this process.


BHelen-Wisemany: TEC Chair, CEO mentor and coach Helen Wiseman