Sweet Talking Goes a Long Way with the CEO

Merit is not all that matters when you are climbing the corporate ladder, or when you want something from the CEO.   

A new study shows that maybe it’s not about what you know, or who you know, (or what you know about who you know).

Maybe it’s all about how you talk to folks.

Subtle flattery and ingratiating behavior may be far more useful in gaining favor from the CEO.   In analyzing how CEOs selected managers for appointments to outside boards, the study found that ingratiating behavior was the strongest single predictive factor.  Yeah.  Not merit, not credentials, not experience, and not skills, but sweet talking.  Their stunning findings are summarized in a recent press release.

But before you launch your full on charm offensive, remember, you can’t be obvious about it.  The researchers helpfully recommended the seven most effective methods of ingratiation.  They are:

1) Frame flattery as advice-seeking. For example, you can ask, “How were you able to close that deal so successfully?”

2) Argue before accepting a manager’s opinion.

3) Compliment the manager to friends in his or her social network.

4) Act as if you realize that flattery will make the manager uncomfortable. For example, you can say, “I don’t want to embarrass you but your presentation was really top-notch.”

5)  Agree with the manager’s values before agreeing with his or her opinions.

6)  Tell the manager’s friends how much you agree with his or her values.

7)  Bring up affiliations you think you may have in common with the manager, such as a religious group or political party.

So go forth and be charming.  And don’t forget the little people once you get appointed to all those prestigious boards … but if you do, no worries, we’ll just flatter our way back into your good graces.

Sharp Rise in Senior Staff Turnover Reported

CEO Update recently reported on a trend we’ve been talking about all year – the spike in executive turnover at associations and nonprofit organizations across the Washington metropolitan area.   They reported that the number of open positions posted with them is ”greater than 2008, 2007, 2006 or any other year we have tracked.”

Back in January we predicted that the local job market would be a big game of musical chairs this year, driven primarily by executive turnover. 

In August we observed that top candidates were on the move in larger numbers, and that we were seeing a spike in candidates who were receiving multiple job offers.   As you may recall, on the strength of that trend we declared the recession over  (at least as a retention tool) a full month before the economists made it official on September 20th.   (Then again, in their September announcement, they said the recession actually ended in June 2009 … so just give me 15 months and I’ll predict what happened today). 

No matter how you look at the data, this is certainly a good time to look for a job if you are an association or nonprofit executive.  Not looking?  Then now might be a really good time to update your executive succession plans and rethink your retention strategies, because your best people are getting calls.

How the CEO Should Manage Managers

An article in Inc.com, by Darren Dahl recommends that CEOs pay more attention to managing their management team.  The key is to set clear performance expectations, and then hold the person accountable. 

It sounds simple right? 

But what’s the best way to do that with managers? Here are some strategies to consider:

Set the Vision — Make sure your managers know what they’re managing toward.  Consider sharing clear short-term (one year) and long-term (three to five year) business plans.

Document the Details and Communicate — Make sure your managers have all the tools necessary to do their jobs well. Consider developing some kind of structured feedback regarding performance. You cannot over-communicate the vision, goals, and strategies for your business.

Measure Tasks — A key part of knowing how well a manager is doing is to establish straightforward quantitative measures based on the performance of their team, says Jenni Luke, national executive director of the Step Up Women’s Network, a national organization for women. Luke suggests looking at objective goals set in your business plan, such as:

• Is your manager achieving revenue targets?
• Are they operating on budget?
• Have they developed new customers?

But performance targets are not enough.

Dr. Alice Waagen, founder and president of Workforce Learning, a leadership development company in Washington, DC, says you can establish clear performance guidelines about what makes a good manager, such as:

1. A good manager creates short- and long-term goals for all staff.
2. A good manager sets realistic standards and targets to measure progress to plan.
3. A good manager provides specific, objective feedback on an ongoing basis, informing, enlightening and helping staff members improve their performance.

“For managers to succeed, they need time to learn to manage” Waagen says.  “And then, once they do, they need to be held accountable for their results.”

In my work, I often see managers held accountable for business outcomes, but rarely do I see them evaluated on the management fundamentals that lead to peak team performance.  Dr. Waagen is definitely on to something there.

We’re Going to Double Next Year … No, You’re Not

I love, love love working with entrepreneurs.  I love their indomitable spirit, the reckless relentless optimism.   I choose to spend my time with visionaries, not skeptics – firmly believing that the person who says “It can’t be done” is often interrupted by someone doing it.   And I think you should never doubt your ability to change the world.

That said, when an executive who has not grown their business in any of the past few years tells me they expect to double their business next year, I am skeptical.   One magical hire will not make this happen for anybody.  Venture capitalist Tony Tijan calls this simplistic thinking the “Fallacy of Financial Metrics” in a recent post on the Harvard Business blog.  Tony makes several excellent points including:

“In both entrepreneurial and larger companies, we too often spend time focusing on the desired financial performance target, rather than the inputs that drive those numbers. Because boards, investors and management demand an objective way to measure performance, we often go right to the result without focusing on what caused those results.

Financial performance is a result, a by-product, a consequence of something else. The financial “numbers” ultimately represent the scorecard we care about, but they do not help us understand how to score.”

Executives often tell me they want someone with “fire in the belly” or a “burning desire to win” – they want someone who can “run through walls”, someone who does “not need a handbook” to figure it out.  And once hired, the CEO often tells me they plan to ”set them loose” on these thorny, still unresolved problems.  Except here is the problem.  While the problem is probably old, the new hire is going to be, well, new to the organization.  So the new hire needs to learn how the problem came to exist, and understand all the contributing factors.  And the new hire will not, despite assurances to the contrary, have carte blanche to change the company.  Therefore, the new hire is coming into a company that will constrain their actions in all kinds of subtle and not so subtle ways.   Einstein put it this way “We can’t solve problems by using the same kind of thinking we used when we created them.” More directly to the point – as my friend Jamie Notter puts it – “Culture eats strategy for lunch.”

Top performers know all this.  They are called top performers because they know how to find work environments that give them a chance to shine.  And they often find ways to shine in work environments where others fail – but they never stack the deck against themselves.  So if you want to recruit them, talk to them about your actual challenges, don’t feed them happy talk about financial metrics that may occur once their hard work is done.  (Read:  The Truth is Great Marketing).  If you want to assess their fit to your job, look for the competencies they have to solve your actual problems, their proven track record of relentlessly driving the actions that will get results, and stop looking for “fire in the belly” and other attributes that are nearly impossible to quantify.

And after you do these things?  Yeah…  THEN I believe you will double next year.

Inspiration for Innovation

Alongside the steady drumbeat of bad news, there has also been renaissance of articles to inspire the leaders of small organizations.  Here are a few of the most relevant:   

Peter Bregman says small companies have a huge advantage in this economy.  Not just a competitive advantage, but an advantage in being able to fully engage their employees and build trust with their customers.

“We simply don’t trust companies anymore. We trust people. And in big companies, it’s hard to even find a person to trust as we scream “operator” into our telephones only to get transferred to another menu whose options have changed.”

 John Baldoni says you can Frame This Crisis to Your Advantage.

“Crises provoke disruption. Savvy executives can use them to their advantage to effect change within the organization. The challenge is to frame the crisis as an opportunity, not simply for the executive but for the organization as a whole. In fact, with the organization in flux now is the time for those in the middle, or even on the front lines, to rise up and prove their mettle. . . . Stasis is the enemy of progress. Since crises upset the status quo, there can be opportunities to develop newer and more resilient organizations. There is another benefit to crises as well — working toward change takes employees’ minds off the uncertain future.”

In another article, John Baldoni argued that GM CEO Rick Wagoner failed to lead in 3 key ways.  He did not shake up the go-along-get-along-status quo culture, he did not demand tough solutions, and he did not act with urgency.

Rosabeth Moss Kanter argues Why Rick Wagoner Had to Go.   He was an incrementalist, when GM need transformational leadership to survive.

“Even when executives who presided over a period of decline admit mistakes, it is nearly impossible for them to stir up the organizational energy needed for a turnaround. Those failed leaders symbolize the weight of past losses. People tend to interpret their actions as self-justifying, chosen to rewrite past history. After all, if the old CEO had wrong ideas in the past, why should people believe he or she has the right idea now? For GM’s Wagoner, as the problems got worse, the loss figures got bigger, and little else appeared to change, his credibility slipped into the negative zone too.”

With all this talk of innovation, how do you know if your leadership team is ready to innovate?

The Leadership Acid Test

By now, every sentient CEO knows this is the time for bold action, for innovation, for challenging old assumptions and demonstrating leadership.  While many CEOs relish that challenge, few small businesses actually have the kind of management team that can really support innovation. 

Innovation simply demands a very different kind of leadership than the ”caretaker” leaders found in many smaller organizations. So how do you know if your team is up to the challenge?   Don’t listen to what they say – everybody is talking the innovation game now.   As my old boss, Steve Ettridge used to say… “turn off the sound and look at the picture.”

Here is my leadership acid test:  Is your management team taking bold, innovative action in the face of the economic downturn?  Are they measuring performance, holding each other accountable, and humbly adjusting course as they find (and tell you about) mistakes?

Or are they blaming circumstances, battling internally, and jockeying for position?  Look at your grapevine, are rumors increasing?   Are people knocking on your door to ask about their careers?  Do you feel like you are choking on increased gossip, fear, blame and paralysis?

Let’s be honest, nobody knows exactly what to do right now.  Nobody has perfect information.  But by now, most organizations are mobilized and taking action.   Some will succeed, many will fail.  

I see organizations sorting themselves into two tribes.  The first tribe is the cohesive, well managed innovators.  They are cutting fat carefully, and directing time and money into the future initiatives with the most promise.

The second tribe is the circular firing squad.  Slashing the good right along with the bad, at war internally, and they will probably not survive the downturn to emerge as a viable entity.

Here are the signs of a cohesive, innovative leadership team:

• Your team regularly challenges your thinking, makes you a bit uncomfortable, tests your assumptions and suggests new ways of looking at old problems. When you share a new idea, it is greeted with enthusiasm and “Hey, that could work if…”  instead of “That will never work, I don’t have time, or I don’t have a budget for that” or worse, people SAY they will take action, but do not.
• Your management team has specific, measurable, metrics to monitor their results and each individual on their team knows exactly what is expected of them.  People “own” their mistakes and failures and team help each other but also hold each other accountable for results.  Information is shared, everyone knows what is going on – even bad news is shared openly.
• You see an increased cohesion in the team – pulling together, and setting aside petty grievances, celebrating small victories.
• You are frequently surprised to hear of their decisions and results – they did not talk about doing it, they just quietly set about doing it.

And here are the symptoms of a circular-firing-squad leadership team:

• Your managers do not have firsthand knowledge of the issues your customers are experiencing. 
• Your managers come up with ”ideas” but rarely prioritize and take committed action on the few things that really matter.  Everyone is an expert in what won’t work, but nobody sticks their neck out for an idea that might work.  Meetings are unproductive talk-fests.
• Your managers are surprised by fairly predictable external events and worse, did not have a contingency plan for dealing with those surprises.  (Hope is not a strategy)   Communication is often poor and decisions made hastily.  Externally their actions look erratic, irrational and unfair. 
• Your managers do not have a firm grasp of the metrics that predict future performance.   They do not have “trigger points” identified to take action.  (“If sales fall below X we need to layoff 3 people”)
• Problems land on your desk without any hard analysis or suggested action plans.  People whine about problems without taking ownership for getting results despite the obstacles.  You feel like you need to make too many decisions “below your pay grade.”
• Most telling – you feel like you cannot trust their judgment.

If you have the circular-firing-sqaud team, you need to admit that you hired most of these people, and you let their performance deteriorate into what you have right now.  Now all you have is false promises, delay, failure, excuses, blame, and really poor information to make critical decisions. 

Instead of having a team who can innovate their way out of the downturn, all you can do is pray for the end - you cannnot outperform the market – in fact you will probably be viewed as a meal ticket by your better organized competitors.

How Important is Effective Recruiting, Really?

We’re working with a client to solve a problem with their talent pipeline.  They have a steady (if slightly unpredictable) need to find one or two very expensive, very “hard to find” people every month. 

I live to solve problems like this.   Ask me about FMLA or the tax implications of a Flexible Benefit plan and I’m utterly adrift.   But talk to me about a systemic recruiting problem and I’m all over it.   (If you are like me, your mind is already working on the problem and you are thinking of where to find pockets of candidates, thinking of what outreach strategies to use and figuring out how you might use various social media strategies to engage them in a conversation?  Ok, well, maybe that’s not you and just the voices in my head talking…)

Anyway, it’s a great gig.   The CEO totally “gets it.”   He knows that the candidate experience needs to be consistent from awareness building, through initial contact, through cultivation, through the entire recruiting process, through the offer/acceptance/onboarding process, through the performance management /compensation process, through the employee referral process.  One cohesive, authentic experience that conveys “You are important to us a person, you are important to our success, and your personal success is important to us.” 

When we get the recruiting strategy right, he wins.  Get it wrong he loses.  Because the right people are at the very center of his growth plans. 

The CEO knows his current uncertain, unpredictable talent pipeline means several (very bad) things to this firm long term:

• His first line managers are tempted to settle for mediocre people because the flow of good ones is so uncertain.  So senior managers have to watch hiring much more closely to avoid the mistakes that come from settling for Mr. Right Now, instead of Mr. Right.
• More time is wasted in the interview sequence because managers are currently choosing from the “best of the worst” instead of the best of the best.  
• Work piles up, deadlines get missed, teams get stressed and customer service suffers as positions go unfilled longer.
• Managers are very reluctant to manage performance tightly because everyone is so hard to replace.
• The sales team is not emboldened because “yes but how will we staff it?” lurks in the back of everyone’s mind.
• Teams are burdened with low performers, because, well, someone is better than no one right?  And loyal top performers pick up the slack without complaining…up to a point, and then they start to look around…and the death spiral of lowered expectations starts in earnest.
• Employee referrals are a tiny fraction of what they could be, because, nobody asked, and well, you don’t want your friends to be put off by a lousy, uncertain hiring process, and burdened with slacker teams now do you?
• Oh, and millions of dollars ride on the outcome. 

So yeah, my client and I both think effective recruiting is really important, and its’ importance is not diminished one iota during a recession.  Because great people never line up around the block to work for anyone.  Someone needs to know exactly who they are looking for and draw them into a conversation first.

An excellent framework for thinking about the recruiting pipeline  is Doug Davidoff’s recent post about The New Marketing Funnel.  While not written with recruiting in mind, I think it’s a great contribution to the ROI of Social Media debate. 

We HR blogniscenti love to debate active vs. passive job seekers, social media vs job boards, xraying Linkedin  using boolean searches, cold calling techniques, etc..  It’s a great education and a spirited debate, but for me, it’s only entertainment until I can apply that knowledge to solve a real world problem for a CEO who “gets it”  and have a transformational impact on the success of his firm.

Where the Jobs Are . . .and Other Fallacies

I’m looking forward to an onslaught of news articles about how the stimulus package will create jobs in different industries.  And I will dutifully devour that material and breathlessly report back to you on how it will affect the DC region.  And I will be wrong in ways I cannot even imagine.  As Yogi Berra once said, “It’s tough to make predictions, especially about the future.”   (He’s a national treasure, that guy).

So Yogi’s comment is my first disclaimer as I share with you a snazzy state by state interactive map of economic forecasts, but before you have fun with the interactive forecasts, let’s first review the forecasts made LAST year by BusinessWeek’s impressive panel of notable economists.  In December of 2007:

“The economy won’t sink into a recession next year. That’s the overwhelming view among the 54 economists in BusinessWeek’s annual economic outlook survey.”

OK, so 14 months ago, literally 2 of 54 economists actually predicted this recession we are in.   And these are the guys who are telling us how long it will last?

If you still believe in economic forecasts, just slog through Black Swan, and your misplaced trust in economic forecasts will be forever put to rest.  

This is not to say I am pessimistic, far from it.  I just have no confidence that anyone can accurately forecast the future. So we all need to be ready for an unpredictable future, which very few firms are doing.  Being ready does not just mean cutting costs, it means challenging old ways of thinking and reallocating resources to support your future growth.  It means asking new questions about the business.  “Where are our strongest growth prospects?  Do we have the right team in place to capitalize on those opportunities?  What costs can we eliminate if we try a different approach?  Who is effectively driving results for me right now, and who is just lost in the turbulence?”  (Are you a CEO?  Click here.  Are you a recruiter? Click here) 

The Misplaced Loyalty of the CEO

There is a consistent theme emerging from my conversations with CEO’s lately.  Loyalty.  While many people enjoy bashing Fortune 500 CEO’s for showing no loyalty to employees – and for dumbsizing, the bigger issue for smaller organizations is too much loyalty.   I see too much loyalty to long-time employees who are not performing, and too little loyalty to everyone else who is.   Truth be told, I’m not really a fan of Jack Welch, but he did have an interesting column about misplaced loyalty in BusinessWeek.

Most business leaders really struggle with their loyalty to long-time employees who are no longer effective, and while I think loyalty in general is both admirable and good business . . . blind loyalty is not.  It is dangerous.   The context matters. 

Sometimes the person’s performance just waned over time – they “got comfortable”,  sometimes the person was simply over-promoted (Think: Peter Principle), sometimes the person took on a job that appeared similar but required different skills (Think: salesman promoted to sales manager), perhaps the most common is when a growing company simply “outgrew” one of the original employees.  

Increasingly in this recession, the problem person was a good steward of a function during normal times, but simply cannot adapt to the chaos of the current environment.   They resist change, ignore market signals and get in the way of new initiatives – doing what is comfortable and familiar, instead of what is right.

My conversations with CEO’s generally go something like this:

How to Make the Most of the Economy Right Now

Bob Corlett

Come join me on February 18th when I talk to the Montgomery County Chapter of the Society for Human Resource Management (MC-SHRM).

The topic is “Recruiting in a Recession:  How to make the Most of the Washington Economy Right Now.”  We’ll be talking about what recruting strategies are working best right now and how employers can best take advantage of the current job market conditions.   Since I am the speaker, naturally we’ll be talking about  my favorite topics including:

• Trade-in Time – How you can trade in your mediocre people for better people.
• The Great Talent Migration – Highly qualified people are moving to Washington DC because of our strong job market- so get ‘em while they last.
• Hiring for Performance - How can you raise the bar on  performance expectations with your new hires?
• What the CEO Wants from HR – what kind of conversations should HR be having with senior management right now?

Registration is only $20 for non-members.  Bring me your toughest recruiting challenge, but leave those rotten tomatoes at home - no hecklers please!

A Time for Vigilence

It’s the Monday before Thanksgiving and as Washington begins its’ predictable slide into “let’s put that off until next year” it bears reminding that this is no ordinary year.  And it’s no time to coast, just putting things off for later.  Quite the opposite.

 

On the downside, how are you positioned for the downturn? Are you tracking performance?  Do you know exactly who you will cut and when you will take action if things get worse?  Do you have a layoff plan you can immediately put into action before things get really bad?

 

If everything stays the same, how are you staying close to your customers? Will you know right away when something significant is happening?  Do you have key positions filled with the right people?  Are you saying the right things and inspiring confidence in your key stakeholders?

 

On the upside, will you be positioned to take advantage of new opportunities, or will you be caught by surprise?  The firms who thrive in this economy are the ones who best understand their environments and react quickly to opportunity.  Same old, same old will not be enough.

 

What the CEO Wants From HR

I just got back from moderating a panel discussion for the Human Resource Association of the National Capital Area. The topic was “What CEOs Want from HR.” I love joining the local SHRM chapters, and used to be on the Board of HRA-NCA, but honestly, it’s been a while since I made it to a meeting. Lately, I’ve spent alot more time in CEO circles.

One issue that keeps emerging from my CEO forums is that entreprenuers and company CEOs put their jobs or their income on the line all the time. 

Why Are Search Firms Thriving?

Instead of using their internal recruiting capabilities, why are so many executives willing to pay fees to search firms? According to this article, search firms are often able to do things than internal recruiters cannot. Search firms have the luxury of managing the search assignment with a single-minded focus. Similarly, search firms are more able to reconcile the hiring requirement to market realities.  Read more from Harry Griendling’s provocative blog post.

Vigilant CEOs Focus on Performance

I was recently invited to speak to three groups of local business executives who are part of the Renaissance Executive Forums. Most business owners told me their business was fine, a few told me their prospects were terrific, but without exception, every CEO had either vacant positions, or critical positions where someone was under-performing and not getting the results needed. Bottom line – this job market is still short on talent, and many employers are still hiring.

Employers in our area will have an unprecedented opportunity to “import” top performers from other parts of the country for the forseeable future – I call this The Great Talent Migration.

Flexibility as a Business Strategy

Most employees like flexibility: flexible work schedules, flexible leave, telecommuting. Now companies are increasingly adopting flexibility as a business strategy. BDO Seidman’s CEO Jack Weisbaum says, “In order to compete and grow in today’s complex, global business environment, companies have to move beyond viewing flexibility solely as a tool for talent retention or employee satisfaction and make flexibility matter to all aspects of their business.” CFO’s are seeing a bottom line benefit to using flexibility. They say it helps them stand out in the face of competition, minimize environmental issues and reduce health care costs.  Download the study here.