On Leadership

Two Competencies Have the Greatest Impact on the Perception of Leader Potential

Given the importance of succession planning, many organizations spend a great deal of time trying to identify the managers who have what it takes to advance and take on additional responsibility.  But what really sets apart leaders who are exceptional in their current positions and are seen as having potential for more challenging roles from the exceptional leaders who are not seen as having potential?

 

To help answer this question, OnPoint Consulting, in partnership with the American Management Association, collected data on the effectiveness of 622 managers across organizations including government agencies, non-profits, multi-nationals, Fortune 500, and Fortune 1000 organizations.

 

We found that two competencies (out of a possible 46) differentiated exceptional managers who were seen as having the potential to take on more challenging roles from exceptional managers who were not perceived to be ready: managing and leading change and critical and analytical thinking. 

 

Strong analytical and critical thinking (which involves questioning basic assumptions, applying sound reasoning and judgment, understanding the complexity of an issue and breaking it into manageable pieces, and understanding the implications of data and information) appears to be a building block for managerial success, and, when coupled with solid interpersonal skills, produces a strong leadership profile.  Clearly some people are more proficient in this area, due to personal preferences or experience, but critical thinking is a learned skill that can be developed and improved through practice. 

 

Managing and leading change frequently comes up as a critical factor in managerial effectiveness.  However, in OnPoint’s study on how top-performing companies prepare for and manage change, only 46% of the 655 managers who responded believe that change is managed effectively in their organizations and 43% lack confidence that current organizational changes will be implemented effectively. 

 

Based on our research, the core behavior of the most effective change managers is modeling behaviors that support the change.  This goes beyond verbally endorsing a change. It is exemplified by specific actions such as: behaving in a way that is consistent with the change; doing what they say they will do related to the change; engaging people in dialogue about the change even when they don’t have all the answers; being aligned with other managers; and ensuring the timing of change is realistic. 

 

Because competence in critical and analytical thinking and managing and leading change appear to be linked to perceptions about the potential of exceptional leaders, focusing training and development efforts in these areas would help increase the likelihood that leaders are prepared to advance and take on additional levels of responsibility.

 

For more information or to request a complete copy of the report of findings, please visit our website at www.onpointconsultingllc.com

 

Four Ways to Ensure Leadership Responsibility

Leadership responsibility is the foundation of effective strategy execution; its management 101. Why do some organizations maintain high levels of leadership accountability and others fall short?

 

A new study by OnPoint Consulting surveyed 400 leaders and found that 40% report that employees are not being held accountable for results.  Our research on top performing companies identified five actions that have the greatest impact on an organization’s ability to increase leadership responsibility.

Use goal setting to facilitate strategy execution. Translating strategy into department goals and clarifying priorities increases the likelihood that implementation plans will focus on high-impact outcomes. It also facilitates individual goal setting which enhances leadership accountability.

Clarify expectations to drive performance management. Effective leaders use three techniques to enhance responsibility; clarify exactly what needs to be done, establish a specific date for when the task needs to be completed, and agree on checkpoints to review progress. These actions are based on three fundamental premises of performance management:
- Never assume people know what’s expected of them.
- Don’t just talk about ideas without agreeing to actions and ensuring responsibility.
- Don’t ignore when someone has dropped the ball.

Coordinate and follow up on progress. Coordinating and monitoring activity is a critical aspect of strategy execution and is an essential ingredient for building a culture of accountability. It’s how companies keep people focused on high-priority goals and actions.  The most effective leaders are ruthless in monitoring goals and reinforcing appropriate behaviors.

Provide accurate and timely information. This involves clear communication about strategic priorities as well as ongoing dialogue between managers and their direct reports. Goal setting and coaching are key elements of performance management systems, yet too often this is viewed as an administrative, HR-driven activity, rather than a tool to help enhance business execution.  When managers view performance management as a tool to drive results they are more successful in building accountability among their direct reports.

For more information about the study or to request a complete report, please contact Rick Lepsinger at

rlepsinger@onpointconsultingllc.com

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Profiles of Effectiveness: Differentiators of Top Performing Managers

Although times are bad, talent still matters.  Organizations that take a long-term view recognize that talent management is particularly important during tough times to avoid talent shortages when the economy improves. 

 

Understanding which competencies make the difference in a leader’s effectiveness and the extent to which this varies by level becomes is a critical starting point.  To help answer these questions, OnPoint Consulting, in partnership with the American Management Association, collected data on the managerial effectiveness of 622 managers across organizations including government agencies, non-profits, multi-nationals, Fortune 500, and Fortune 1000 organizations.

 

Four key findings from our study and tips for using this information to enhance talent management efforts are shown below.  A complete report of findings is available upon request.

 

1.    Exceptional managers, regardless of level, demonstrate competence in four key areas.

 

Our study found that Action Orientation, Building Teams, Building Trust & Personal Accountability, and Critical & Analytical Thinking differentiate top performers at all three levels: first-line manager, manager of managers, and functional manager. 

 

Implications for Talent Management—Because these competencies appear to be essential for top performance at higher levels as well as for managers of individual contributors, both formal and on-the-job training that help develop these competencies should be targeted to first-line managers to ensure they develop these skills early in their careers.  Allocating resources to this area will help build a strong pipeline of internal managers who are prepared to make the transitions to the next level of management and take on additional responsibility.

 

2.    In addition to the four core competencies, it is important to master specific competencies that are critical for success at each level.

 

In addition to the four core competencies described above, exceptional managers master specific competencies required for success at their level.  We found that exceptional managers received substantially higher ratings than average performers in the following key areas:

§         First-line managers: Self Development and Resilience & Stress Tolerance

§         Managers of managers: Influencing, Interpersonal Savvy, Creative Thinking, Emotional Intelligence, and Strategic Planning

§         Functional managers: Action Orientation, Customer Focus, and Managing Conflict

 

There is “face validity” to these findings when one considers the unique challenges experienced at each level.  Being a learner and having a tolerance for stress would certainly serve new managers well as they take on the responsibility of getting work done through others for the first time.  Likewise, interpersonal skills are particularly relevant for someone who is managing managers. Taking a broader strategic view is also a key competence at this level.  For the functional manager, although all the previous skills are certainly important, the unique challenges of the job require an action orientation, a focus on the customer, and the ability to manage cross-organizational differences.

 

Implications for Talent Management—These findings provide guidance for making selection decisions and for the timing and content of training and development.  For example, since the most successful first-line managers are learners and have a high tolerance for stress, organizations should assess leaders for these competencies as part of the selection process.  On the job support for developing these competencies would also be important.  In addition, preparing people to take a broader organizational perspective and building strong interpersonal skills before they are promoted to a manager of managers role would increase the probability of success in that position.

 

3.    The ability to effectively execute plans and initiatives is the hallmark of an exceptional manager.

The managers in our study who were considered exceptional received higher ratings in the areas related to execution and getting things done: Action Orientation, Problem Solving, Decision Making, and Results Orientation.  Competence in these areas appears to set the best apart from the rest.

 

Implications for Talent Management—Most organizations understand the need to develop an exciting vision and a realistic strategy.  The key issue for organizations today is fulfilling the promise of that vision.  In a recent OnPoint survey, 49% of respondents reported a gap between their organization’s ability to formulate a vision and strategy and deliver business results.  Sixty-four percent of those people lack confidence in their organization’s ability to close the gap.  Ensuring managers have the skills required to deliver consistent results and get things done day-to-day should be a top focus of an organization’s management development activities.

 

4.    Practice is required to build competence and expertise—managers don’t need to be born with it.

 

Our study suggests that managers who are in a position for five to ten or more years are more likely to be seen as exceptional.  Exceptional managers gain competence and enhance their performance over time, while the average managers reach a performance plateau.  This supports the idea that expertise and effectiveness are the result of experience and practice. 

 

Implications for Talent Management—Moving managers to the next assignment too quickly does not provide enough time for them to learn from the experience.  Managers need to see the impact of their actions to truly develop competence.  In addition, expertise results when managers are required to tackle problems and situations they have not faced before and that take them out of their comfort zone.  This finding emphasizes the importance of providing on-the-job learning opportunities such as action learning projects where leaders work on solving real business problems. 

                                                

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OnPoint Consulting specializes in helping companies close the gap between strategy and execution.  For more information, please visit our website at www.onpointconsultingllc.com.

Cultivating Future Leaders: Five Strategies for Tough Times

Despite the challenging economic climate, firms with a long-term view continue to invest in their leaders.  Traditionally, when budgets get tight, leadership development and succession management programs are often the first things companies cut.  However, proactive talent management is even more critical during tough times to avoid talent shortages when the economy improves.  

 

Rather than slashing budgets, here are five strategies that help companies get the most out of investments they do make in talent management:

 

§         Focus on competencies that make a difference.  Rather than offer “leadership development 101”, it is more effective to assess the competencies or skills that are most critical to the future success of the business, and focus skill development in these areas.  If Innovation and Strategic Acumen are important areas of focus, then it is beneficial to offer programs that will help leaders build these specific skills. In addition, leverage internal data (e.g., performance management or 360° data) to determine the key development areas for most leaders.  If aggregate data suggests that leaders are strong in Innovation but weaker in Strategic Thinking, this information will help prioritize training needs.

 

§         Take learning and development out of the classroom.  Many organizations are creating activities that provide on-the-job learning opportunities such as action learning projects where leaders work on solving real business problems.  Recently, an insurance company recognized that there was a need for its senior managers to enhance their level of customer focus and financial acumen.  The CEO sponsored an action learning project where these managers worked in teams to solve two important business issues.  The teams generated high-quality recommendations to address these challenges, while gaining knowledge that addressed their top development needs.  Other companies are using on-the-job training opportunities, cross-functional teams, or rotational assignments to help leaders enhance their skills.

  

§         Focus on high potential leaders and critical roles.   Rather than using a “one-size fits all” approach to talent management, focus on high potential leaders who will be critical to the future success of the organization.  The best practice to high potential identification is to use some form of assessment to provide objective data on these leaders.  In addition, determining what roles are of strategic importance to the company is another worthwhile step to ensure that there is a talent pipeline for those roles.  While succession for key executive positions (e.g., CEO, CFO, and COO) is important, it is also beneficial to identify potential gaps in bench strength for other critical roles (e.g., sales management positions) throughout the organization.  Investing differentially in talent is a strategic decision that pays off.

 

§         Offer alternative delivery strategies. Due to travel restrictions and opportunities to increase efficiency, many organizations offer online training programs or blended learning solutions (a combination of web-based and in-person meetings), which results in tremendous savings.  Other organizations are using internal resources to facilitate their leadership development programs.  Rather than simply reducing the number of leadership development programs offered, use creative ways to ensure that leaders receive the necessary training to be successful in the future.

 

§         Measure the impact of leadership development on business performance.   Companies with data that illustrates the return on investment (ROI) of their leadership development initiatives have a powerful business case for talent management.  Senior executives who understand the importance of strategic talent management continue to invest in their leaders.  Therefore, it is important to implement a measurement plan that will help demonstrate the value of talent management initiatives.  For example, data that shows the link between leadership development and customer satisfaction or other business metrics is particularly compelling.

 

Companies that invest in talent during tough times are more likely to see the pay off when tough times are a thing of the past.

Formula for Tough Times: Four Ideas to Maintain Morale and Productivity

It’s tough out there and companies are looking for ways to maintain employee morale and productivity.  We wanted to collect practical suggestions that work in the real world, particularly in today’s environment, so we went directly to managers and HR professionals to find out what they were doing to keep people engaged and focused on results.  We found four best practices that were consistent across our interviews. 

 

Increase disclosure.  Employees are always interested in the company’s financial health and leadership’s view of industry and competitive conditions but tough times heighten the need for timely information.  The majority of companies we spoke with are increasing the frequency, detail, and amount of information they are providing. 

 

Dust off recognition programs.  Although many companies have recognition programs in place they are often not being used effectively.  A quick win for many companies is to ensure managers use available recognition programs.  These range from an e-card/thank you note to more substantial monetary rewards.

 

Find alternatives to lay-offs.  Despite how bad things are, this will turn around and companies want to be prepared when they do.  In addition to the pain lay-offs cause individuals, many companies also suffer when the inevitable turn around comes and they discover they don’t have the right people in place.  To reduce costs yet avoid this problem organizations are experimenting with unpaid furloughs, salary freezes or cuts, four-day work weeks, and reducing contributions to retirement and health plans.  These actions are still painful but they are seen as the lesser evil and better in the long-term for both employees and the company.      

 

Involve employees.  Encouraging employees to contribute ideas for cost savings and process improvement accomplishes two important objectives.  Not only do some of the best ideas come from the employee population but involving people in decisions that affect them decreases the feeling of uncertainty.

 

It’s easier to keep employees motivated when times are good.  Exceptional leaders and organizations use a combination of traditional and innovative ideas to maintain high levels of morale and productivity in a challenging business environment. 

 

Share your best practices with others.  We are interested in hearing what you or your company is doing to maintain morale and productivity in today’s economic and business environment. 

Beyond the Bonus: Five Ways to Engage and Retain Top Talent During Tough Times

It’s been a tough year.  Bonuses were lower than expected or were non-existent and next year may not be much better.  The company’s success depends on retaining a motivated workforce but how can you retain top talent and keep them focused on results without a big payday at the end of the year?

Research has shown that earnings and benefits have a combined 2% impact on job satisfaction and engagement, while job quality and workplace support have a combined 70% impact.

 

What does this mean for your company?  The research points to five practices a leader can use to retain and engage talent, especially when tough times make bonuses questionable. 

 

§         Create a sense of purpose.  Engagement and retention improves when people understand how they connect to the “Big Picture” and how they make a difference. Feeling connected to the people you work with also helps create a sense of purpose.

 

§         Provide meaningful work.  Allowing people to do what they do best and make a significant contribution is key to engagement and retention.  Also providing opportunities to learn and grow is icing on the cake.

 

§         Solicit ideas.  Involvement in decisions gives people a sense of control in uncertain times, shows them their opinions matter, and improves decision acceptance.  

 

§         Let people know where they stand.  Setting tough but realistic goals is motivating even in a tough environment.  Clear goals are only part of the equation.  People need regular feedback so they know when they are on track and recognition when they achieve key milestones. 

 

§         Enhance trust and communication.  Trust is built when leaders improve credibility by being candid, demonstrate reliability by ensuring their actions are consistent with business objectives and values, and and are accessible.  The more people feel you are focused on them, rather than on yourself the more they trust you.

 

Not being able to give bonuses is a concern but following these five proven guidelines will help prevent your best people from leaving.

Four Actions to Keep Your Business Out of the Performance “Red Zone”

It’s not news that this is an extraordinarily challenging time.  Sharp cutbacks in consumer spending and credit have created an environment of fear and uncertainty among employees and leaders alike.  During tough times unless a business gets its leaders’ best thinking, it is in danger of sliding into the performance “red zone” where profitability and even survival are in question.

There are, however, four things effective leaders can do to avoid the performance red zone and keep the business moving forward.

 

Don’t Panic.  Effective leaders don’t let fear drive decision making.  Fear can make a leader “hunker down” and wait for better times.  It clouds their judgment and causes people to make poor decisions.  During tough times the best leaders are optimistic yet realistic.  They focus on the business’ basic success factors yet remain open to new ideas.

 

Maintain customer loyalty.  This is the time to sharpen the focus on customer needs and add value rather than nickel and dime them.  Although some cut backs are necessary, the most successful leaders know that it still makes sense to spend where it adds value.  And, with the right choices, a small expenditure can have a big impact. The manager of a Best Buy store in Manhattan understood this when she arranged to have a dog sitter at her store to make it easier for customers to shop.

Focus your business model.  To add value and still reduce costs, a business should focus on enhancing efficiency and reliability.  Top leaders and their teams know where and how to cut cost without impacting service or quality.  This point has been made painfully clear to the US auto industry and shows the impact of the inability to balance these two demands.

Build trust.  Because tough decisions often have to be made, a leader may erode trust.  Trust can be maintained or repaired if leaders improve crediblity by being candid, demonstrate reliablity by ensuring their actions are consistent with business objectives and values, show genuine empathy and be accessible.  The more people feel you are focused on them, rather than on yourself, the more they trust you.

 

Delivering results when the economy is strong can be challenging but the real challenge is delivering results during a downturn.  These guidelines can help leaders be a winner and keep their business out of the red zone.

 

Tell Us Your Story

What are you doing during this difficult time to maintain high levels of employees morale and to keep people focused on results?

When is a Business Like a Car Accident?

In a down economy a business is like a car accident because everyone slows down to watch.

 

During tough economic times keeping employees focused and engaged is critical to ensuring your company stays in the game.  Our research on top performing companies points to four leadership actions critical for success in the current environment.  

 

Be optimistic but realistic.  It’s important to be positive about the future without appearing naïve.  The key is to set realistic expectations and find the right balance between resources, time, and desired outcomes.  People have confidence they can succeed, even in a difficult economic period, when they feel that objectives are realistic and adequately resourced.

 

Hold everyone accountable for results.  Tough times demand that everyone bring their “A” game and pull their own weight.  Therefore, it is important that everyone understands what is expected of them and when.  Then monitor progress, celebrate successes, and recalibrate or coach people to get back on track when necessary.  It is also important to create an environment where people can raise problems and admit mistakes, rather than “covering up” or “pointing fingers,” which is more likely during challenging times.

 

Involve people in decisions.  When times are tough you want everyone’s best thinking and full commitment.  Now is not the time to close people out of the decision-making process in order to protect them or to ‘speed things up.  Involving people in decisions increases decision quality and acceptance, and enhances engagement.

 

Ensure plans and actions are coordinated across departments and levels.  Don’t let uncertainty or ambiguity push you into a day-to-day mindset, as this is not the time to “wing it.”  However, even the best plan will fail if everyone is not pulling in the same direction.  During difficult times, efficiency is critical and coordination is king.

 

Even in a weak economy there are winners and losers.  By consistently applying the four key actions you increase the likelihood that you and your team will end up in the winner’s circle.

 

We’re interested in your opinion.  What are you doing to keep your employees focused and engaged?

Four Ways Top-Performing Companies Stay Ahead of the Pack…Even in Tough Times

These are challenging times that test the competence and endurance of even the best companies.   Our research on how top-performing companies prepare for and manage change and what they do to ensure they are able to execute plans and strategies effectively reveals some interesting differences between companies that are able to weather an economic down turn and least successful companies. Top-performing companies are characterized by cultures that are flexible, adaptive, participative, and innovative—and they operationalize these cultural attributes through leader behavior.

 

Leaders in top-performing companies are capable in four areas—managing paradoxes, leading change, participative leadership, and leading by example.  If you’re a CEO, make sure all your leaders meet the following criteria:

 

• Get comfortable with managing paradoxes. Leaders in top-performing companies are better at finding the right balance between what appears to be mutually exclusive outcomes such as achieving short- and long-term goals and establishing control and providing autonomy.

 

• Use the five keys to managing change. OnPoint’s research identifies five specific behaviors that enhance the ability to lead and manage change effectively.   Leaders need to be forthright about the change and its impact, model behaviors that support the change, set realistic objectives, ensure that they have adequate resources, and take steps to maintain enthusiasm among employees.

 

• Involve team members in the decisions that affect them. Participative leadership matters. In 2006 the NBA introduced a new basketball and never asked the players for input during development. As a result, the players refused to use a new ball they felt was difficult to handle. Involving the players early on would have increased the quality of the ball and the acceptance of the “new ball” decision.

 

• Lead by example. Leaders in top-performing companies understand that people will not trust or follow them if they do not live by the same values and support the same priorities they require of others.  

The bottom line?  Staying on top is always a rigorous challenge—and it is even more difficult in tough economic times. But the alternative may result in a significantly downsized organization or a bankruptcy filing.  It’s easy to win when conditions are favorable.  The best companies have leaders who distinguish themselves by winning even under difficult conditions.

 

What’s Your Opinion?

 

What is your company doing during this tough economic period to ensure they come out on top?

Collaborating From a Distance: Success Factors For Top Performing Virtual Teams

"Globally linked virtual teams will transform every government and company in the world.  Any of our peers who don’t do it won’t survive."

-John Chambers, CEO, Cisco

 

Rising travel costs, coupled with the global dispersion of talent, are just some of the reasons that organizations have migrated toward virtual teamwork.  While numerous organizations have made significant investments in virtual teams and the technology to support them, a surprising number of virtual teams are not reaching their full potential.

 

A new study conducted by OnPoint Consulting surveyed 48 virtual teams across industries and found that there are specific practices associated with successful virtual teams.  We were surprised to find that many of the virtual teams in our study struggled with fundamental issues such as not having clear roles and responsibilities or not having a shared process for decision making.

  

What makes top performing virtual teams successful?  Our research identified nine practices that are the key ingredients for optimal virtual team performance: 

 

Team members demonstrate a high level of initiative.   Members of high performing teams are more proactive and engaged, and they demonstrate higher levels of initiative.  Thus, it is important to ensure that team members have clear roles and celebrate team success.  One way to do this is by creating a team charter to enhance commitment and accountability.

 

Team members are willing to assume leadership responsibility.   Even though the majority of teams had dedicated team leaders, team members on high performing teams proactively took on leadership responsibilities as required.  In contrast, members of less effective teams were less likely to do this.

 

Teams have a shared process for decision making and problem solving.   Low performing virtual teams did not establish processes to facilitate problem solving and decision making.   Effective team leaders ensure that communication processes are established early on and revisited over time.

 

Team members are clear about how their work contributes to the success of the organization.    High performing virtual teams have an understanding of how their work aligns with the strategy of their organization.  This is extremely important in a virtual environment where team members may feel isolated and it is common for team members to become disengaged.

 

Provide timely feedback to one another.   Communication challenges are more pronounced in virtual teams, especially when there is a lack of face-to-face contact and time zone differences.   However, high performing virtual teams find ways overcome these challenges.

 

Trust one another to get things done.  Trust is a top factor for virtual team success but task-based trust (a belief that team members will do their job) is especially difficult to develop when planned or spontaneous interactions among team members are infrequent and difficult to arrange.   Trust builds when team members follow through on commitments and hold one another accountable for results.

 

Team members are willing to put in extra effort to get things done.   Team members of top performing virtual teams are willing to go above and beyond what is required to accomplish team goals.  Therefore, it is important for team leaders to inspire team members and regularly monitor members’ motivation.

 

Team members work together effectively.  Successful virtual teams have determined how to effectively collaborate.  If organizations invest time and resources in virtual teams, then it is important to capitalize on this and ensure that team members understand how to work together to achieve their goals.  Successful teams develop operating guidelines to help structure team communication and coordination.

 

Team members help one another achieve team goals.   High performing virtual teams involve team members rather than independently executing tasks and objectives.   They place greater importance on leveraging others to get work done whereas less effective teams do not involve one another as frequently.

 

If organizations want to maximize their return on investment, they should ensure that these core practices are in place and continually assess the performance of their virtual teams against these factors over time. 

  

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