On the mean streets of marketing, where thugs lurk in every alley and aisle, your choices are few. Five strategies, that’s it. Of those, only two of those are worth pursuing. Of those, neither will succeed if they haven’t been built with a keen understanding of the competition as they will exist tomorrow.

• Slug It Out means going up against an opponent who is fairly evenly matched with you. You stand toe to toe and try to hurt them more than they hurt you. This is probably the most common strategy, and it’s a bad one. A marketer convinces herself that her product has a unique selling point, launches, and only too late finds that the difference isn’t perceived or valued by customers/consumers or that the competition can quickly adapt. In the end, it’s a war of attrition, and luck has a lot to do with the outcome. Yuck. Don’t bet the company on this one.

• Loser Loser Loser is where you go when you either are a masochist or haven’t done enough homework to notice that your enemy has deeper pockets, better product, better value, better connections, or a better brand. If you want to go there, send me an email. I want to watch the fun. I’ll bring popcorn.

• Dancing in the Dark means you’re hoping to win before anyone notices. Maybe you’ve found an underserved niche, or an unaddressed need. Maybe a new channel. From there only three things can happen. First, you might be wrong and thus fail. Or you might be right and  succeed … if your market is too small for your competitor to care about. Or maybe they have just been snoozing, in which case your little success will eventually wake a tiger.  So before you go here, you’ve got to ask yourself one question, “Do I feel lucky?” Well, do you, punk?

• Shock & Awe is about engaging where you have overwhelming competitive advantage. Your battlefield may be the heart of the market, or it may be a niche. Either way, the outcome is predetermined. Congratulations, soldier! General Powell salutes you.

• Change the Game leaves your competitor either fighting the wrong war or scrambling to catch up. Done badly, this can degenerate into Dancing in the Dark or Slug It Out. But if you’ve studied the competition, consumers, and market dynamics, you may find several winning ways to change the game:
  • Go Up-Market: Vodka is pretty much of a commodity. So Grey Goose, Kettle One, Belvedere, and a few other upstarts started whispering that anyone not paying a hefty premium was a social loser. The old brands lost.
  • Go Down-Market: Don’t want to pay extra for a pre-assigned airplane seat? Southwest has a deal for you! Don’t need a store with fancy shelves and snooty sales people? Go Old Navy!
  • The Best of Both: Redefine the category by redefining the value equation. If your brand promises (and delivers!) all the quality of premium Brand X at the price of value Brand Y, what’s not to like? You’ve just collapsed a two-segment market into the middle.
  • Sandwich Shop: Again, you redefine the category by redefining the value equation. You go up-market and down-market simultaneously with two differentiated products, targeting both the segment willing to pay more for higher performance and the segment willing to accept less performance at a lower price. You position the heart of the market as mediocre, satisfying no one. You’ve just segmented an undifferentiated market. But remember, if you make a sandwich, you want to be the bread.
  • My Team’s Bigger than Your Team: Find allies. Maybe there are distributors who have been frozen out by the staus quo. Or suppliers. Or maybe you can create some. iPhone gave a platform for app developers, and having thousands of apps incented purchase of iPhones; everyone won, except Nokia, Blackberry, Palm, and Microsoft (who did the same thing to Apple in the 80s and 90s).

We have argued that the only rational innovation strategy is to balance effort behind both organic sustaining growth  and disruptive innovation. However, Clay Christensen, Harvard’s innovation theorist, points out that companies have a greater chance of success by specializing in one or the other. Specifically, he argues that market leaders do best by focusing on sustaining innovations, while newcomers should focus on being disruptive.

Why? He says about sustaining innovation in The Innovator’s Solution:

“Because this strategy entails making a better product that they can sell for higher profit margins to their best customers, the established competitors have powerful motivations to fight sustaining battles. And they have the resources to win.”

In the battles for the heart of the market, the incumbent can win and must win. By fighting and winning them repeatedly, they continuously strengthen their position within the status quo. You want to take on Tide? Good luck, buddy. You cannot begin to match their brand power, technological prowess, or power with retailers. And with each year’s product improvement, they keep getting more formidable.

But because the leaders are so highly motivated to maintain the status quo, they do not have strong incentives to disrupt it. That creates the opportunity for small competitors, or would-be competitors, to change the game.

Christensen argues that disruptive technology usually starts at the low end of performance, and is not good enough for the heart of the market. However, it is generally less expensive and maybe more convenient, and so attracts a new set of consumers to the market. Think of Honda’s first motorcycles in the early 60′s. They did not in the least threaten the rough tough kings of the black leather motorcycle market. But they were cheap and fun and small enough to not be threatening, and so encouraged young suburbanites in letterman jackets to buy their first motorized two wheelers.

Could Harley or other incumbents have successfully marketed such small bikes? Unlikely. Even if they had been able to see the market potential, their management teams would have been ill prepared for the challenges of high volume low margin production, and the new low performance products would have diluted their brands’ equity.

But equally, has Honda or any of the other Japanese motorcycles seriously threatened Harley’s hold on the hog market? Of course not. Harley focused on organic growth, and after some early bumps, emerged stronger than ever.

What Christensen misses is that the incumbents, while using sustaining innovation in their core markets, can still be disruptive by extending their brand. So Harley innovated by embracing licensing. Tide learned the value of liquids and pens and stain-release packs. Conversely, every disruptive newbie who changes the game soon has to shift into sustaining mode – think of that when you switch on your iPhone 4.

It’s still about balance. But Christensen is right: focus on the type of innovation that best enables you to win.

- Seth Godin, Linchpin

Seth Godin has built a terrific career by giving us new lenses through which to view ourselves and our culture. He shown us all how to be marketers, leaders, and artists. I disagree with many of his generalizations and simplifications, but sometimes I read something from him that takes my breath away. The quote above certainly did.

Early in my career, I ran across Peter Drucker’s famous dictum “What gets measured gets managed.” Over the past many years, this has proven true more times than I can count. And yet, it begs some crucial questions:

• Are we measuring the right things?
• Are we measuring the right way?
• How should we deal with immeasurables?

Seth reminds us the what is immeasurable is often more valuable than what we can quantify. He argues that if I can track it in a spreadsheet, so can my competitors. So what can be measured may not provide competitive advantage (roll with it a moment – yes, it’s a silly oversimplification, but that’s Seth’s world).

On the other hand, what cannot be measured (yet) is capable of transforming the world. How can we measure creativity in a meaningful way? How can we measure passion, engagement, or commitment? But isn’t it intuitively correct that these are the most important fuels for our modern economic engine?

These questions are particularly significant when trying to manage what Daniel Pink calls Motivation 3.0. As my friend Molly Rosen of The Working Chronicles points out, the dominant performance management systems were designed to fit the industrial world – Pink’s Motivation 2.0. They quantify extrinsic performance on scales of Core Competencies. There are two problems with this:

• First, as Godin points out, what’s most important may not be quantifiable – and most evaluation systems assume that what cannot be quantified does not exist
• Second, as Pink points out, systems that were designed for the industrial system are often counterproductive in our era of creative knowledge workers who are driven by intrinsic factors

What gets measured gets managed. If you want to evaluate me on 15 competencies and tie my compensation to that evaluation, you’ve got my attention. I will strive to perform. The problem is, you may be measuring the wrong thing, and losing both my engagement and my most valuable potential contribution by doing so.

Because it’s not a trivial miscommunication. The dictionary allows innovation to mean both “a new idea, method, or device” and “introduction of something new,” and between those two lies a vast chasm. Is the emphasis on newness or on commercialization? We’re talking differences in scope, in resources, in process, in outcome, and in requisite management skill set.

When a CEO says she wants to build a culture of innovation, she is probably hoping to churn out game-changers like iPad or Swiffer. But chances are her product manager will chalk it up as an innovation win if he can launch the 5th flavor of his brand’s yogurt.

Many thought leaders in the field of innovation distinguish between sustaining and disruptive initiatives. Sustaining innovation is a product improvement or line extension – something close to home. Disruptive innovation is something radically different for the market and the organization. One is comfortable for the status quo. The other is not. One is predictable and repeatable. The other is not. Each requires distinctly different skill sets to manage well.

I believe we create confusion by naming both with the same word. It enables the CEO to think disruptive and the product manager to think sustaining, and thus fosters lack of organizational alignment.

Businesses would be better served by reserving the word innovation only for disruptive initiatives that challenge the status quo. I don’t mean to minimize the importance of sustaining initiatives. These are the projects necessary to maintain a business’s health and drive the kind of predictable growth that allows organizations to thrive. Business-as-usual requires organizations to fill their pipelines with these organic growth initiatives and have processes for completing them in a predictable, orderly manner.

Remember that Apple – this decade’s poster child for innovation – puts a lot of effort into sustaining initiatives like periodically upgrading their operating system, introducing new colors and configurations of iPods, adding new carriers for iPhones, and slimming down iPads. If they did not, each of these businesses would quickly become a commodity in the face of competitive pressure. They schedule their upgrades well in advance, and deliver them on time to impact quarterly sales forecasts.

So healthy businesses need organic growth initiatives. But they also need innovation to create major new opportunities, and that’s a different ballgame.

True innovation – the development and successful commercialization of game changing ideas, products, or processes – is messy. No one has ever figured out how to have a Eureka! moment on a regular schedule. Breakthrough ideas only come when they are ready to come, and then usually present extraordinary challenges on the way to commercialization. Because, by definition, they threaten the status quo, which most of the organization wants to protect. They engender internal resistance from well-meaning managers who ask important questions, like “Will the innovation cannibalize current business? Will it divert resources from parts of the business that are growing predictably? Will it confuse customers? Will it fit the brand? Couldn’t we do something less risky?”

Good business managers are generally adept at building and driving a pipeline of sustaining initiatives. They measure their success by the market impact they deliver. But successful innovators must have a high tolerance for uncertainty and ambiguity. They need to not feel threatened by the idea that their pet projects may never get launched. They need the resilience to hold their head up at company meetings even when others see them as draining resources from safer projects. They need the fortitude to chase promising insights down rabbit holes from which they may not return. They need to feel they have earned their salary by making progress – because they may never deliver market impact.

Innovators are a different breed. By embracing higher risk in pursuit of higher reward, they are the ones capable of putting their companies into hyper-drive. They are the world changers.

Just don’t insult them by calling your latest version of toothpaste an innovation.

Per Petterson, Out Stealing Horses

Recently, a successful CEO client told me, “I’m not good at decisions. I get caught up in possibilities.” Later that day, I ran across the above quote in Petterson’s remarkable novel, and I thought, “How often do we make ourselves our own biggest obstacle?”

Petterson’s character is talking about learning as a boy to become reckless, but his learning equally applies to becoming creative, decisive, empathetic, more communicative, a better listener – all the skills related to Leadership.

Those of us predisposed to relating to the world cognitively learn at an early age to get results by analysis. Trying to guess what the teacher wants us to say. Trying to figure out what the popular kids are doing. Trying to figure out the mechanics of Ted William’s swing.

I remember my little league coach who, after watching me strike out about a thousand times in a row, suggested that when I next take my stance at the plate, I notice the smell of the grass and hot dogs. While I sniffed, I forgot to think about Ted. Crack! My first hit.

Do you think Ted thought about how to hold his bat? Does Kobe pause to consider when to pull up and shoot? Did Picasso agonize over his brush technique? Probably when they were young. But at some point, they learned to set knowledge aside and trust their instincts.

When approaching a major decision, it is useful to generate options and analyze them. But at some point, it’s time to move into action. If “the best” option isn’t obvious, it might be because there isn’t one. Just choose. Act. Learn. You can always adjust later. But for heaven’s sake, get out of the way!

Cognitive understanding is a powerful tool, and many of us need to use it in the early stages of learning. But at some point, we must put it down and just do. Get out of our own way. Let ourselves achieve beyond our dreams.

1) Service & respect – that includes customer-focus, but goes beyond to have a service mentality towards all stakeholders, both internal and external. Great organizations foster a culture of respect, service, and candor.

2) Financial transparency – that requires both clear reporting and clear metrics, and as we know, what gets measured gets managed.

3) Mission & values – as Dan Pink writes in his superb book, Drive, modern workers need a sense of purpose in their work. The organization must clearly articulate how they intend to impact the world. This creates internal passion and engagement.

4) Strategy-driven – strategy answers the question “how will we win?” If every worker can’t understand how their efforts contribute to winning (however that’s defined) the organization risks misalignment and failure. Strategy also defines where the organization must excel – whether in innovation, operations, branding, financials, site-selection, portfolio, customization, community-building, or some other area. No one can excel at everything; strong organizations choose.

5) Diversity leading to excellence – strong organizations foster robust debate, and use disagreement to create solutions that are superior to any one point of view. This is the opposite of compromise, which ladders down to common denominators.

6) Action orientation – great organizations do great things, do the right thing, and achieve results.

What do you think of this list? What would you add or change?

Many organizations have institutionalized the practice of periodically requesting 360 degree feedback as part of their review and development processes. There are many ways to do this. Some work better than others. Some are dangerous.

For most of my career, I have used qualitative 360′s to evaluate my own performance and that of subordinates and clients. I keep it simple, asking five questions:

• Overall, how is this person doing?
• What are his/her strengths?
• What are his/her opportunities for improvement?
• What should he/she start doing?
• What should he/she stop doing?

The idea is to get people talking, to probe the silences and meanings between the lines, and look for commonalities and differences in different people’s comments.

This is a powerful tool, but time consuming. Not surprisingly, an industry has grown with automated online 360 assessments. They not only efficiently provide more data points; they also facilitate benchmarking.

And therein lies the problem.

360′s are wonderful for identifying blind spots and to raise questions for further exploration. They are terrible for forming judgments about someone’s performance. And benchmarking automatically encourages judgment.

Why? Call it apples and oranges syndrome. Different people and different organizations approach 360s differently. That makes comparison to benchmarks – averages – meaningless. And without meaningful standards to evaluate results against, making judgments based on these surveys is a misuse of data.

Over a decade ago, I was given the opportunity for a broad 360, along with most of the other managers in my company. I was pretty new there, and was eager for feedback. I included in my feedback everyone I dealt with, including two subordinates who were in process of being terminated.

I got a lot of useful feedback. But my scores were far below the benchmarks. Being analytically minded, I dug into the numbers and found that every question had 2 people who rated me zero on a five point scale. If I assumed that those were unreliable respondents – possibly vengeful – and recalculated my scores excluding the zeros, my ratings strongly above average.

My boss saw the below benchmark scores and informed me I had a performance problem. He did not want to hear about the two consistent outliers. “The numbers speak for themselves,” he said.

I mentioned this to a friend within the company, and she was horrified. “Mark,” she said, “these 360′s are used for management decisions. We all cherry-pick our panels. No one puts in someone who might rate them low.”

So there was gamesmanship involved. The game may be played differently in different organizations, but it’s safe to say that different people will approach 360s with different rules and assumptions. Averaging them and establishing benchmarks is therefore inappropriate. Apples and oranges.

I strongly encourage leaders and managers to get feedback from these powerful tools. But understand the limits of the methodology, and don’t try to evaluate versus benchmarks based on averages. Use the feedback to find areas to probe and explore. Then make informed decisions.

I suggested that while we often cannot choose the conditions of our lives, we can choose how we relate to our conditions.

“That’s facile,” he replied. “How does that apply to me?”

“Have you ever considered,” I asked, “what you get from your depression?”

He was silent a moment, then asked, his voice dripping venom, “What I get from it? Are you crazy?”

“Work with me. Explore how the depression helps you.”

His words came slowly at first, but once he got going, it turned into a torrent. Depression gave him an excuse to justify failure, to avoid stress, to not get angry, to emotionally curl up in a familiar zone…the list went on. These weren’t necessarily positive things, but for whatever reason he was attracted to them.

When he finally stopped, I said, “Look, I’m not a therapist, but it seems to me there are parts of being depressed that you like. My guess is that the attraction will never go away. But you’ve also told me how depression hurts you. Is there some choice here?”

His depressions haven’t gone away, and likely never will. But now he recognizes them as opportunities to choose. For the most part, he can manage them now for the first time in his life. He recently dealt with his wife leaving him and an extremely stressful period at work, and stayed mostly functional throughout. Some days he still can’t get out of bed, but now he can laugh at himself while he hides in the pillow.

He has changed how he relates with a critical condition of his life because he accepted it.

This story is an extreme illustration of a principle that impacts all business leaders. Often we nurture the parts of ourselves we tell ourselves we hate. Why? Because they feed us in some way.

If there is no benefit in doing something, it’s easy to stop. What we continue doing, we do because we’re getting something. Smokers have a hard time quitting because they enjoy the nicotine. Spouses become abusive because it feels good to vent. Micro managers and back-stabbers  continue acting in ways they know they should not because they like the sense of control.

A counterproductive behavior is an addiction. As bad as the outcomes are, something in it feels good. Until we recognize and embrace what draws us to it, we will keep doing it. Only when we honor what draws us to the addiction can we choose other actions.

It’s not as simple as retraining a bad habit or medicating away a negative attitude. It’s recognizing the role addictions play in our lives, and then choosing to do something different.

• “How can I re-distribute my work in order to provide a more richly developmental experience for each subordinate?”
• “What can I offer to take over from my boss that will give him or her helpful support and, at the same time, give me needed stimulation and growth?”

Why are these two questions critical?

First, you need capacity to take on the kind of projects that will stretch you. Most managers I have worked with settle into the comfort zone of their current job, where demands are continuously doable but engulfing. Almost all of my clients have the same  complaint: “I don’t have time to take on anything new!” Yet when we discuss what they could download to subordinates, they invariably resist: “I can do it better and faster myself.”

Sure you can. That’s why you have the job you have. But unless you develop subordinates by delegating some of your juicy projects, how will they ever be able to grow enough to replace you, so that they stay engaged and so that you can move to bigger and better opportunities? And how will you ever be ready for bigger and better if you don’t create capacity to stretch yourself now?

That’s why Mr Lucht’s questions are so powerful. By re-distributing your work, you simultaneously give your subordinates a chance to grow and create capacity for yourself to stretch. By offering support to your boss, you are starting to work today at the next level of your career. To say nothing of building a better relationship with your boss by giving him or her the capacity to stretch and grow.

Building your tomorrow starts now. Help your subordinates replace you, and start developing so you can replace your boss.

Now I find a fine article by Marshall and Kelly Goldsmith that argues that the problem is not with the training, but with attendee’s level of caring and commitment. They write:

“To become a better leader, you must have the fire within to change, do the actual work, and … have the humility and courage to discuss your progress with a colleague.”

Hmmm. I don’t disagree – in the end, it’s always an individual responsibility to drive personal change. But I have rarely seen attendees who were not fired up about change, and yet they fail. So I believe there is also fault in how most training programs are designed.

It is not uncommon at the end of training programs to ask trainees to write their goals for change and maybe even add a specific action or two. Sometimes this gets sealed in an envelope and mailed to the attendee a few months later as a reminder.

Not enough.

No successful project manager would be that sketchy.

Trainers should instead take a project management approach to driving change. The trainee must make develop a specific action plan with tracking metrics and milestones, clear process, and public accountability.

Goldsmith, in What Got You Here Won’t Get You There, offers an outstanding method for driving significant personal change, one that I have used successfully with clients. It requires a high level of commitment and vulnerability – the willingness to expose both your frailties and desire to change to others, and enroll them in helping you create the change. But this approach almost certainly requires a coach, which is not always feasible.

I believe trainers could approximate something like this by directing trainees to develop measurable goals and very granular action plans, then building a process that makes them accountable to each other for follow up. Have them check in frequently with each other to report progress and receive feedback. Ideally, each person’s action plan would include soliciting regular feedback from a broader circle.

I have not implemented something like this, and would love to hear from anyone who has.

I’ve been fortunate to work with some outstanding leaders, and found each of them made from a different mold. For example, when I started at P&G, our CEO was John Smale, brilliant but famously introverted. He was succeeded by Ed Artzt, a charming but vicious in-fighter who demanded loyalty and rewarded his people. By contrast, his successor, John Pepper, emphasized team building and broad-based empowerment. Each understood his unique strengths, and each was a great leader.

Despite differences in personalities, studies have found that most leaders exhibit a similar set of qualities or behaviors. Compare what two separate research groups found:

• George and Sims in True North identify five characteristics:
  • Purpose with passion – a highly motivating sense of mission
  • Values that guide one’s choices and actions
  • Leading from the heart – being tough but compassionate
  • Enduring relationships to keep one from imagining that success is one’s own accomplishment
  • Self discipline, exercised over and over
• Kouzes and Posner in The Leadership Challenge identify five “practices”:
  • Challenging the process
  • Inspiring a shared vision
  • Enabling others to act
  • Modeling the way to achieve the desired goals
  • Encouraging the heart of everyone involved

What is striking to me in these lists is 1) how similar they are, and 2) that each of these characteristics and behaviors can be cultivated.  George and Sims make the point that leadership is a process, not a destination. It’s lifelong learning, a journey without end.

So pick your set of characteristics or practices, then begin to exercise them. It helps to have a mentor or coach to help hold you accountable to yourself. Otherwise, you may find it is too easy to justify backsliding and counterproductive behaviors.

I am not convinced that everybody can become a great leader, but I am absolutely convinced that anyone can continuously make progress at becoming a better leader. And if anyone ever tries to tell you that we need fewer chiefs and more Indians, don’t believe it. We all need you to lead better.

Best wishes for a wonderful journey!

What they all have in common, however, is the assertion that when we are aware of our dominant behavioral style, we can choose to adapt to the situation.

Why should a leader adapt his or her style? Isn’t that a sign of weakness or inauthenticity? Shouldn’t others conform to the leader? Doesn’t adapting make you look weak, inconsistent, or insecure?

Not necessarily.

Certainly, if he does it poorly, the adaptive leader may confuse his team or appear to be a flip-flopper. But done right, adaptation displays confidence and greatly enhances team effectiveness. Authentic leaders are driven by their values and goals, and realize that style is just a tool. They adapt their style to present information and engage in relationships in ways that best allow the other person to understand them and engage back.

Just as you have a dominant personality style and a powerful set of needs, so does every other person you deal with – and theirs are different from yours. While desiring to serve you (the boss), some people may prefer you to give specific orders, while others may need to feel as if they have created the solution, while still others need a sense of collaboration. If you insist on using your dominant style with all people – staying in your comfort zone – you might as well be speaking a foreign language to most of them.

Leaders need results. Thus you have a strong incentive to adapt to others’ needs – to serve their needs – so that they can be most effective at achieving the goals you set for them. You don’t need to change what you do, only how you do it. We’re talking style, not substance.

Your subordinates, suppliers, or customers may not even be aware of their style and needs. You are (and if you’re not, give me a call; I’ll happily point you in the right direction), so you’re the one that needs to bridge gaps. And if they are aware enough to adapt themselves to fit your style, so much the better – two people working to accommodate each other while grounded in their own goals and values is the basis for a very healthy relationship.

Good dancers know how to conform to their partner. And what is business if not a dance?

Julie Straw in The 4-Dimensional Manager discusses when doing nothing is your best choice. Her screening criteria go like this:

• Is this situation important to me?
• Is it possible to change this situation?
• If it is possible to change this situation, are the potential rewards worth the effort (and I would add, the risk)?

The situation in Libya pushes us to Julie’s third point. Human rights abuses and military action against civilian populations matter to most of us, and between the U.S. and NATO, there is certainly enough power to intervene and remove the regime. However, the risks of opening a third war in the Muslim world are huge, and in the face of war-weary public sentiment, are substantial and caused much hand wringing and head scratching among the world’s policy makers before the UN vote for a no-fly zone.

As a manager, I have often chosen inaction because I was maxed out with higher priorities – i.e., the situation might have been bad but not as important as other priorities, and choices had to be made. My belief system says that change is never impossible, but often the risks or costs of creating that change outweigh potential benefits.

I’m not judging either action or inaction against Gadhafi, but rather using this to make a point. Choices to act must always be framed against values, interests, and the broader context, including opportunity costs. Those who respond to crises impulsively will soon overreach.

When you are wired towards action, as most successful leaders are, it is difficult to do nothing, especially when doing nothing means allowing a bad situation to continue. Still, that is sometimes the best option.

When it is, however, strong leaders don’t whine. They turn lemons into lemonade by focusing on the upside benefit of not being distracted from what you do choose to act on, rather than the downside of allowing a bad situation to continue.

The trouble with most innovation methodologies and processes is that they look for “facts” to guide decisions. There’s a reason for that. Facts are useful for driving alignment among groups of people with different interests, and alignment is essential for success in complex organizations.

So what’s wrong with fact-based innovation? Basically, it’s that not all “facts” are facts. They may derive from scientific-looking processes. They may look like facts. They may sound like facts. But they are fictions because they ask people to quantify their future decisions based on their current experience.

Such “facts” lead to bad decisions. That’s why, as Peter Murane points out, 70%- 90% of new products (depending on the category) fail within the first twelve months, and the ones that survive tend to have disappointingly small sales.

By fact-based innovation, I’m talking processes that put concept tests in the driver’s seat. You know, “On a scale of 1 to 7, how likely are you to buy Product X?” As if consumers could imagine a world in which Product X was part of their environment, speaking to them at the shelf and through various media, a world where early adopters influence our decisions.

Murane points out that concept tests are useful for weeding out the bad ideas. But even this overstates their usefulness, because they also generate false negatives. As was the case with both of my biggest successes.

Both of those products only became reality because of gut instinct and perseverance and a willingness to say, “Damn the facts! People don’t know what they’ll want in the future!” And some awfully patient senior managers.

Please don’t get me wrong. I love developing and testing concepts. But skilled innovators listen between the lines. They don’t care if people hate their idea, but instead seek insights about why people hate it. The trick is to get to the real world quickly and observe consumers using prototypes – not to believe what they say, but rather to trust what they do. Of course, as launch gets closer and serious spending ramps up, you better have some pretty hard rationale for why this innovation will succeed. Blind faith is as bad as false facts. Consistent innovation success requires juggling instincts, insight, options, and risk management.

I don’t have answers here, and that’s my point. All methodologies have flaws and vulnerabilities. Strong leaders know when to trust them and when to ignore them. In this, as in all things related to leadership, it’s a question of balance.

But one suggestion: get out of the lab and away from concepts as soon as possible. Risk failure. Put prototypes into people’s hands and let them use them where they live.

Today is the last day of a lovely vacation. I am well tanned, well fed, and emotionally, well, chaotic. This is how I get during transitions: swirling. Half distraught about leaving the beach so soon, half delighted about the coming challenges. Today I am the putty pulled between these two poles.

I know this territory. I’ve visited it often over the decades. And I’ve learned that how I feel over the next week or two has everything to do with how I manage my energy on Monday morning.

When I assess a new client’s – or my own – well-being, relational energy is a major KPI. We have only four ways of relating to our challenges. We can be:

• Checked-out
• Checked-in
• Engaged
• Obsessed

I met my first checked-out individuals in my first office job. I was thirty at the time. Up til then, I had mainly been around musicians, entrepreneurs, and teachers, all of whom tend to be passionate about their work. But at this job, two of the eight sales cubes were inhabited by older gentlemen who no longer understood the technologies they sold, and who seemed primarily interested in getting to their evening vodka.

We’ve all known those folks. Going through the motions. Apparently present, but not. The living dead. Checked-out. They may be hostile and radiate negativity, they may be charming and fun to be with, but they are not really here when they are here. Companies who fail either to revitalize or purge these wraiths will soon join them in a hot tub of lethargy.

On the other extreme, who hasn’t worked with an obsessive personality? I spent much of my career life obsessed with the project-du-jour. Hyper-focused, hyper-driven, workaholic. Relationships with people, whether at work or home, sat in the back of the bus. Succeed or die. Divorce city.

The thing about obsession is that it a drug. You get hooked. You crave it. A day spent not obsessed feels like death. But like all drugs, the high is not sustainable. You might keep running on high octane for years, but you will inevitably crash. It won’t be pretty.

Checked-in is where too many of our coworkers are. They do their jobs. They deliver good enough results. They earn their pay and bonuses, the occasional pat on the back and the occasional slap on the wrist. Sometimes they accept recognition or applaud their colleagues, sometimes they fume about perceived injustices, but in the end, they just don’t care all that much. Hopefully, they have a passion somewhere in life, but their job ain’t it. And ain’t that a shame? 40-60 hours a week of just getting by? At some point, they’ll check out.

Which brings us to the sweet spot: Engaged. Caring about the results, the processes for getting results, the conversations and connections that drive the processes. Caring about the long term and the short term and all points in between. Not just checked in. Plugged in.

When you’re engaged, work is part of the fabric of your life. Unlike with obsession, you can at will put down one engaging part of your life and pick up another. When things go well, you can celebrate, and when they don’t, you keep on keeping on. You pursue your goals unashamedly, yet are open to what comes your way, because you have no doubt that life is filled with riches beyond comprehension.

Here’s the lovely secret: we get to choose. We can cultivate engagement. If you don’t know how, talk with your spiritual advisor or hire a coach or shoot me an email. You can get there, and really, there’s no other place worth being.

Today, in my end-of-vacation stew, I know that torn-between-two-worlds is part of my transition process. But I also know that Monday, when I hit my desk, if I don’t manage this relational energy consciously, it will manage me. It will give me a week or two of choppy waters, and that always makes everyone I care about a little seasick.

So this I will do: I will plug in. I will be fully engaged. I will be energized by the challenges of my workday, I will be focused at the gym, and by dinner, I will switch to being fully engaged with my family.

Life is too short for any of the other options.

Hunter examines the implications of the following facts:

• Most psychologists believe that our personality – our predispositions – is hardwired by age 6. Most personality assessment methodologies are based on this assumption.
• They also believe that intelligence as measured by IQ is pretty much set by age 15

Does this mean that our lives are programmed before adulthood? Not at all. We are our own masters due to two other facts:

• We can continue learning new skills throughout our lives (see my post on adult learning)
• The primary driver of leadership is character, which we exercise and develop by the moment-to-moment choices we make hundreds of times every day

The key is the frequency with which we make conscious choices, and thereby strengthen our character. Just like reps with a dumbbell build muscle fibers, so reps with enlightened choice build moral character, which gives one the authority to lead. We can coast through life avoiding choices and personal responsibility, or choose to become aware of all the choices we make every day (of course, the choice to not be aware and not to choose is still a choice! It’s just not conscious or enlightened).

My dog lives in a world of stimulus and response, as defined by Pavlov. My daughters, when they were babies, did also. But as they have grown, they have learned that between stimulus and response is a space where choice resides. They can choose to wait to go to the bathroom, or to be generous, or to make themselves vulnerable by avoiding the easy lie. These are the types of choice that allowed Gandhi and King to respond to violence with neither flight nor fight, but with kindness and perseverance. When I teach meditation, when someone asks, inevitably, “Why meditate?” I suggest that regular practice increases our awareness of choices, takes us out of reaction, and thus gives us true freedom.

Maturity – and true leadership – is the quality of living in that space of freedom, aware of one’s moment-to-moment choices and the true implications of those choices. It’s easy to act like a two year old and scream “Me! Me! Me!” all day. Immaturity can even achieve much for a while. Look at Saddam Hussein. It’s more difficult, but hugely more powerful, to consider how one’s actions will reverberate through the lives of others and either gain force by inspiring them or die by squashing them.

The good news is that maturity is a journey, not a goal, and that one can make progress throughout one’s life. Continuous self improvement. Continuous growth.

Isn’t it fascinating how in many organizations, someone with no power or title often emerges as the moral leader, the one everyone else turns to for advice or insight? That’s authority! How does someone without title or power achieve such status? Hunter provides the answer when he quotes a Marine Corps captain defining leadership as “the qualities of moral character that enable a person that inspire and influence a group of people successfully.” Moral. Character. Inspire. Influence. Success.

Wow. Isn’t that the kind of leader you aspire to be? What’s stopping you?

Innovation was last decade’s business buzzword, and for good reason. Real innovation is hard, but the potential payoff is huge. High risk, high reward.

We define innovation as the commercialization of a marketplace discontinuity. By definition, then, innovation has unpredictability built in – no one is good enough to truly disrupt with planned regularity. And that makes many managers uncomfortable, so many have expanded the meaning of the word to encompass their comfort zone. What they actually do is specialize in line extensions like new sizes or flavors or small performance upgrades – but tell the world they are master innovators.

We believe those types of close-in projects can be terrific for driving organic growth. In most categories, they are necessary for maintaining core business health. However, they are rarely capable of driving sustainable, explosive growth.

Adam Hartung and others write on the need to reinvent organizations by building the exploration of white space into their business plans. They argue that companies who stick too tightly to their business models and their comfort zone eventually find themselves obsolete.

We don’t disagree. But here’s the conundrum: most of the time, sticking to the core business and the comfort zone works just fine. It makes good sense to focus on what you know, to be better than anyone at your one area of expertise, like the hedgehog who knows one invincible way to defend itself against bigger smarter predators.

Until one day when some fox figures out how to change the game. Then the hedgehog is dead. And there is no one you can hire to tell you when this time it really is different. You never know until it’s too late.

Game changers – discontinuities or true innovations – appear unpredictably. They are what Nassim Taleb calls “black swans” – events that no one expects until they suddenly rock your world.

To protect your business against the inevitable black swan, organic growth is not enough. Here is what you must do:

• Remind yourself regularly that a black swan is just over the horizon, and it will someday obsolete what you do today, then
• Build the processes and invest the resources necessary to optimize the likelihood that you will innovate (and obsolete yourself) before someone does it to you.
• Recognize that innovation is easier said than done. Peter Murane of BrandJuice argues convincingly that the standard innovation processes used today are highly flawed. To be effective, be ready to innovate innovation.

The only prudent strategy for a growth company is to focus on strengthening the core – your hedgehog strategy – while simultaneously working to obsolete it before some fox does.

You can’t postpone working on discontinuous innovation until you need it. It’s too late by then.

But neither can you focus exclusively on innovation. Do that, and your core – your hedgehog that is your best defense most of the time – will wither and rot.

Sustainable success requires multitasking and balance. The growth company must pursue the right portfolio of organic growth projects and the right portfolio of innovation projects. Each must be balanced, and the combined portfolio must be balanced – for risk vs reward, for present vs future, for resource usage, and for pipeline needs.

No one said it was easy. But isn’t that the fun of it?

Over the past 30 years, I’ve had a few dramatic experiences where dropping preconceptions and viewing the situation from a “wrong” perspective created huge potential. I am wary about over-generalizing from one’s war stories, but here is one worth considering.

Early in my career at P&G, I was put on Pantene, a 30-year-old brand we had just acquired as part of the deal when we bought Richardson Vicks, a huge multinational healthcare company. Pantene was the smallest brand in our haircare portfolio – which included Head & Shoulders, Prell, Pert, Ivory, Lilt, and Vidal Sassoon – and there seemed little reason to keep it. We were told to kill it or sell it.

In those days, few brands were in multiple categories; for example, it was not a foregone conclusion back then that a shampoo would also sell a conditioner and vice versa.  But Pantene competed in several categories – shampoo, conditioner, treatments, and styling aids - despite having small shares in each of them. In fact, in the only category we cared about at P&G, shampoo,  Pantene’s share was a fraction of 1%. Clearly, by P&G’s standards, Pantene was a failure.

The only thing that made us pause was the fact that it sold pretty well at a few drugstore chains where our other brands tended to struggle. Before we dumped the brand, we decided to understand why. It turned out that buyers at these chains viewed haircare through different glasses. They didn’t look at shampoo, conditioner, etc. They looked at Total Haircare, the composite of several categories. And unlike P&G, they didn’t care about volume share; they measured dollar sales. When they totaled Pantene’s dollar sales in all the different categories, it was their #1 brand.

What P&G saw as not worth bothering with, they saw as a critical part of their business.

That insight led us to innovate Pantene’s business model. We tore up the P&G playbook. Where the Drug channel was an afterthought for our other brands, it became the single-minded focus for us. Because the channel wanted continuous product news, we became a product innovation machine on steroids, churning out large numbers new items twice a year (P&G brands were typically launching 1-3 new SKUs annually). Where P&G typically fought to keep shelf prices low with occasional discounts, our buyers wanted – and we supported – high shelf prices with frequent discounts.

Within two years, using the Total Haircare Dollar Share metric that we had to calculate by hand, Pantene was #1 or #2 in the 17 top Drug chains. It had become P&G’s second most profitable haircare brand. There was no more talk about killing or selling it.

I worked on Pantene for 3-1/2 years, and was lauded for breaking all the rules. But it’s hard to maintain a maverick culture in a process-driven company. A few years after I’d moved to another assignment, I heard that Pantene’s strategy was being retooled. That was certainly the right choice – it had outgrown its single-channel strategy – but the reason given made me sad: Pantene was internally viewed as a failure because its shampoo volume share was less than 1%.

Learning: changing your glasses can drive powerful innovation, but creating permanent change requires multiple stakeholders to be willing to view things differently.

Two decades later, I was given another brand in a similar situation, a chance to do the same thing, only better. This time, I made sure everyone was fitted with new glasses. Again, it worked. Only this time the changes stuck.

Many leaders believe they must choose one or the other, that it is not possible to execute both successfully. In fact, it’s become quite fashionable to claim that only “white space strategies” – disruptive innovation – can drive growth.

We disagree.

How do you grow organically? Organic growth means leveraging what you’ve already got or can easily get and integrate. Existing expertise. Adjacent distribution. The same or similar customers.

It’s the opposite of hopscotch. It’s walking methodically, step by step.

Organic growth is bedrock of all sustainable growth. It takes relatively little effort. That’s not to say it’s easy, but it is always easier working with what you already know.

What happens when you do not have an organic growth strategy? The heart of your business will eventually rot from neglect. Sure, it’s tempting to believe that the status quo will endure, and thus you can focus resources on new markets. But business is never static. Competitors will eat your lunch while you are distracted. You will lose relevance to your core customers and then need to either invest in rebuilding goodwill with them, or invest in finding new customers.

Under-supporting your core business is a recipe for failure.

Want a poster child for organic growth? Try Apple. While the press fawns over their ability to create new markets, the fact is they continuously work to strengthen their position in their legacy categories, like computers and their iTunes store.

Sometimes the results of a well-designed organic growth strategy can be dramatic. A century ago, P&G leveraged its expertise in working with fats and oils for making soap into a shortening business, which organically led to peanut butter, which gave it roasting expertise, which led to coffee, which led to fragrance expertise, which helped grow the beauty care business. Similarly, by combining the company’s insights about marketing to young mothers (from its soap business) with its technical expertise in wood pulp (from its paper business), it created Pampers. Some might call that disruptive innovation, but P&G will tell you it was organic, never straying too far from their core businesses. Thus they built a remarkably diverse empire.

More often, however, organic growth is incremental. It keeps the core strong and relevant. It prevents erosion. But generally, to drive dramatic growth, you must innovate. We’ll examine innovation, and the balancing of organic growth and innovation, in a future post.

Bottom line, companies that believe they must choose between organic growth and innovation will inevitably fail. The only prudent strategy for a growth company is to strengthen their core via organic strategies while simultaneously working to obsolete it via innovation. Sustainable success is all about balance and multitasking.

The Don was committed to reasoning with others to find win-win solutions. He cared about people and always sought to help them, as long as he was creating the potential for his family’s future profit. He would commit as much time as was necessary to understand their interests and come to a mutual understanding. He would listen carefully and never raise his voice. Nor did he ever lose sight of his own goals and settle for a weak compromise. For he understood that business success comes, above all else, from aligning the interests of all parties, from sharing the wealth, from ensuring that no one feels like they lost. Losers, he knew from experience, carried vendettas which could lead to counterproductive behaviors. Conversely, successful outcomes usually come down to creating an us out of me and you.

I think of this often, for my clients’ biggest problems often derive from their single-minded attempts to impose their will on customers, suppliers, regulators, investors, or employees. They are surprised when, after I’ve listened to their description of the problem, I ask, “How does the other person see it? What’s in it for them?” That simple question often opens the door to being able to reason together.

Of course, Don Vito had one advantage in these negotiations that most of us lack. If he could not reason with you, he would simply have someone kill you or decapitate your horse. But he would be sad that you had compelled him by your unreasonableness.

The changes were substantial. I was stunned, for example, when a senior executive explained how marketing agencies are now managed and compensated: so different from the model I had grown up with. Some brand groups – the heart of the company’s machine – no longer work at the main building, but rather are with multi-functional teams at technical centers. And the technology community, long dominated by not-invented-here syndrome, has enthusiastically embraced open innovation.

But for all the change, what is most important has not changed at all. Curiosity about consumers’ habits, needs, and interests pervades all activities. People are treated with respect and courtesy. Managers are on a continuous hunt for new learnings. Success is less important than progress and creative hypotheses. Data rules all. Crisp, clear communication of ideas – the message – is as important as the idea itself. Decisions are made deliberately and methodically.

These are enduring values. They are not challenged and do not change. And because there is this rock-solid foundation of unchanging values, everything else can change without disruption.

The past, of course, is no promise of the future. Consider Japan. Japan’s cultural homogeneity and shared values allowed it to transform itself at breathtaking speed from feudalism into a modern power during the late 19th century, and from wartime devastation into a global economic powerhouse in the late 20th century. And yet it has been unable to transform again to overcome its twenty-year-long malaise. Similarly, in the 90′s when a new CEO pushed P&G to change too quickly, the company lost its way.

Still. Young companies could do worse than studying and emulating P&G. Discover your values and make them your foundation. Anything else can change.

American education remains one of our economic treasures, a net exporter of services as foreign students flock to our schools. Yet we have this sense of failure. Why?

Let me argue that we have not found the right metrics for success. Unfortunately, since “what gets measured gets managed,” we risk hurting our system by measuring the wrong things. If in doubt, watch Season 4 of The Wire for a brilliant and heartbreaking exploration of the distortions caused by the metric-driven No Child Left Behind program.

It’s easy to measure math and science scores, but I’m not sure they are accurate predictors of future economic success. I don’t know how to measure the following, but if I were in education policy, these are what I’d be advocating that we teach for the good of our country – and trying to find ways to measure:

• Asking the right questions
• Persuasive argumentation
• Clear communication
• Creative problem solving
• Coloring outside the lines and imagining the impossible
• Social leadership
• Discomfort with the status quo
• Seeing what’s coming next, and what’s coming after that
• Deciding how to address the opportunities that will emerge from what’s coming next

Heck, you can always hire some engineer to solve the necessary equations if you can figure out what he or she should be trying to solve. America’s strength has always been developing young people with the capability to know what that what is. How do we quantify and track progress against these admittedly squishy abilities? I don’t know, but I do know our educators have been excelling for decades at what really matters.

Kevin, what led to the topic of From Bud to Boss? How does the theme fit into your long term business plan?

Our marketing partner suggested that we develop a First Time Manager course. The need is clearly there and always there as new managers get promoted. The topic fits our mission at Kevin Eikenberry Group. My co-author Guy was already working with us as a master coach and trainer. We decided to work together to create a workshop. While co-developing the workshop, we decided to also do a book.

The book really grew out of the workshop. As we gave the workshops, we asked ourselves what were the main questions we were getting from participants. We identified twenty-five, and made sure they were all answered by the book. So before writing, the workshops worked as our laboratory.

What’s the book’s key message? Why should someone read it?

The first section of the book is about the transition from co-worker to boss. There are so many new relationships, and so many old ones that have fundamentally changed with the promotion. The transition to being a leader is hard. Being a leader is complex. The book is about making the transition to a harder job in the context of managing people who used to be peers. It’s addressed both to first time managers and the managers of first time managers, to help them be more effective.

The rest of the book is about the most important leadership skills. It’s about having the mindset to be able to succeed. It’s more than just a book, though. Each section has self-assessments and links to online “bonus bites,” which are exercises and templates. There is a whole online community that goes with the book.

Where do you go next with your business? What do the next 5-10 years look like.

There will be multiple new products. I believe in taking massive action. At Kevin Eikenberry Group, we have three focus words. The first is implementation. It’s about making things happen. Next is experience, creating opportunities for people to learn experientially. Finally, there is relationship. We’re in the business of relationships, not just transactions.

Everything we do helps every other piece. For example, a book about training draws keynote invitations, and speaking sends traffic to the workshops. We’re looking ahead to an internet video channel and certifying trainers inside companies.

But in the end, it’s all about leadership.

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Kevin Eikenberry and Guy Harris’ new book, From Bud to Boss, launches on February 15^th. To celebrate the launch, they’re offering special bonuses to people who purchase the book on the day of the launch. These bonuses include free content from a variety of partners who are promoting the launch. To take advantage of these bonuses when you buy the book, visit “these links.” Be sure to join the new Bud to Boss Community to be connected with a wealth of resources about how to be a better leader every day.

A couple of the most popular business books irk me. Michael Gerber’s The E-Myth Revisited and 37signal’s Rework disagree about many things, yet both make the same fundamental error: they over-reach.

Let me make the point by citing a book that never over-reaches, Good to Great by Jim Collins. Like Gerber and 37signals, Collins asserts several axioms about what creates business success. But unlike them, he arrives at his conclusions by a very clearly explained methodology. If you disagree with the findings, you can trace back to how he arrived at them. His work is strongly argued and supported.

Now, the other two offer some terrific insights. I believe any leader would do well to read both. But both get there through the path of personal experience, and make the critical error of over-generalizing. Are they wrong within a narrow category of companies? Absolutely not. Are they wrong outside of their area of expertise? Absolutely.

For example, the 37signals guys suggest only making what you’d like to use. OK. Works fine in a high flexibility, low fixed cost industry like software development. Cost of getting it wrong is little more than opportunity cost. But if you’re making, say, cosmetics, and have a gazillion dollars of capital tied up in mixing and packaging machines, and need to build expensive inventories before you start shipping, well, let me suggest that what you like is irrelevant and what your target consumer likes is everything. Or meetings: right on, boys, they are often counterproductive, and if you are a company of ten coders, you probably don’t need them often. Text each other. Share docs online. But if you need to coordinate hundreds of people working from different disciplines and perspectives and likely with different incentives, may I suggest that without significant face-to-face time the only thing you’ll produce is chaos and mediocrity? Or virtual workspaces: right. Tell that to someone whose business is shopping malls or film production.

They aren’t wrong in their little world. They’re just, well, in their little world.

On the other end of the spectrum is Gerber’s E-Myth. He views the world from his lens of franchisers and retail. Fair enough. And if he presented his work as such, it would be a very useful guide for those pursuing similar interests. But can you imagine a very successful company like 37signals telling their employees to start wearing blue uniforms and speaking from scripts? I think not!

Gerber is out of touch with the type of small software/internet company that evolved over the  past 20 years. Worse, he completely misses the boat with solopreneurs – consultants, artists, and the like. He gets parts of Daniel Pink’s holy trinity of autonomy, mastery, and purpose, but still ends with a vision based on command and control. As Pink argues in Drive, that management style is very effective for driving productivity from defined tasks – e.g., making and selling fast food – but counterproductive where the primary work is problem solving and creativity.

So again: all wrong? No. But universal truths? Far from.

My point is that writers and theoreticians need to either be rigorously empirical like Collins or clearly state the limits of their experience. I admire Collins greatly, but don’t work like him. I write more like Gerber and 37signals, drawing from personal experience and observation. I only hope I do a better job than them at knowing my limits.

Kevin, tell me about the start of the Kevin Eikenberry Group. What was the vision?

I’ve been doing this for over 17 years. Before that, I worked for Chevron, first in sales and marketing, then in corporate training and development. I quickly realized this was the kind of work I was put on earth to do. At first, I thought I wanted to be the next Zig Ziglar. But as I trained trainers, I realized I wanted to help people learn, not just be good on stage.

Now the vision is helping leaders make bigger differences in the world around them, make positive difference. Sometimes the work looks like training, sometimes consulting, sometimes coaching. And I’m doing more keynoting, so it’s come full circle.

When did you realize the business was working? What were the signals?

When I decided to leave Chevron, I told my boss. He was a 35 year guy, his whole life with the company, so he couldn’t fathom why anyone would leave. In fact, he told people I was quitting so I could return to the Midwest, where I grew up. We agreed to a six week transition. I promised not to market to Chevron, but would be available if Chevron managers approached me. Well, by the time six weeks was done, I had three months of work pre-booked [with Chevron managers].

So I knew from the start the business would work. But there have been good times and bad times, not a straight line. I made early mistakes, big mistakes, like getting so busy that I forgot about marketing. I didn’t start writing soon enough. And I didn’t build enough relationships or the right kind.

But I knew from the start that I’d made the right decision. I must be doing something right – not everyone can stay in a business they love for 17 years! I have such a strong desire to help people be successful and shorten their path. I provide many tools for other consultants and coaches to go with my book, Remarkable Leadership. Recently I created a certified coaching program to give them training, credibility, and technical skills.

How has the vision evolved over time?

It’s gotten bigger, broader. I saw it couldn’t just be about training. Now we have multiple income streams – training, coaching, consulting, speaking, learning systems, certification, and writing – because they make each other better.

The vision now is to build the brands of Remarkable Leadership, The Kevin Eikenberry Group, and From Bud to Boss to have more impact on more people.

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I’ll post the second part of the interview next week. Kevin Eikenberry and Guy Harris’ new book, From Bud to Boss, launches on February 15^th. To celebrate the launch, they’re offering special bonuses to people who purchase the book on the day of the launch. These bonuses include free content from a variety of partners who are promoting the launch. To take advantage of these bonuses when you buy the book, visit “these links.” Be sure to join the new Bud to Boss Community to be connected with a wealth of resources about how to be a better leader every day.

He said to imagine you go to an art museum filled with several Gaugins. You stroll through. You notice the vibrant colors, the tropical scenes, the curious eyes of the Polynesian women. Then, as you leave, you run into the world’s greatest Gaugin scholar. She invites you to walk through the exhibit again, this time with her as your guide. Perhaps you think, “But I just saw it all!” But in the end, you go back through with her.

Do you really believe your second experience would be remotely like your first? Instead, wouldn’t her explanation of context and dissections of the painter’s technique create for you an entirely different and richer experience? Wasn’t your first experience limited and defined by what you didn’t know?

I connect this story with humility in the workplace. What if you walked through your work every day assuming that at any moment you might run into your industy’s most insightful person, who would transform your understanding of virtually everything and remove limitations you didn’t even know you had?

We usually live in our comfort zone. We assume we know pretty much everything about what’s important to know. But what if we’re just kindergarteners in life’s school?

Is that so inconceivable?

Keeps you humble, doesn’t it? And doesn’t that open your eyes to new possibilities? Maybe, more than humility, this story is about how to find game-changing innovation.

Organizations mix “facts” into a tasty Kool-Aid that everyone drinks. How reliable is fact-based decision making? What is really real, and which reality should we believe?

Lately, when I ask my eight year old about her day, I get a long rambling synopsis of one of her TV shows. It makes me irritable. I want to snap that while I’m very interested in her, I don’t watch those shows for a reason. Then I remember that for her, those shows are as experiential for her as school and friends. They are not part of my reality, but very much part of hers.

I’ve seen similar patterns in almost organization I’ve worked with. Everyone drinks the same Kool-Aid and buys into a reality that is based on fiction.

Haven’t you ever responded to a request for an update on your business with tables of numbers? How real are those numbers? Are they the reality of the market, or simply part of a narrative that we’ve tacitly agreed to pretend is relevant?

Don’t get me wrong: I love numbers. They are powerful tools. Heck, I went to the ultimate quant business school, and built my early career on the reputation of being an analysis jock. But one of the lessons I took from all those stats classes is that there are no “facts” that cannot be questioned. There are always underlying assumptions, and the wise leader knows that facts are better thought of as hypotheses.

I’m trying to be provocative here because it matters. American business keeps making the same mistake of misusing data. Numbers are terrific as indicators and milestones, as measures of what happened in the past. But the future cannot be quantified. Multiple futures can be modeled, but there is nothing there yet to measure. Consider:

• Detroit’s demise was foundationed on solid analysis of trends. There was good reason for GM and Ford not to develop pursue compacts in the 70′s or hybrids in the 00′s. Meanwhile, Japan kept making crazy bets that made no sense to our rational, scientific, numbers-based business leaders. We know who won.
• The decision to launch New Coke was as fact-based as it gets, built on years of research. But the facts did not predict the future.
• The architects of the our devastating Vietnam war were strong practitioners of scientific management. They had the facts. They were wrong.

Many entrepreneurs do better, following instincts to futures unimaginable to most of us. But with few exceptions, most of our corporations use the fiction of facts to blind them to disruptive possibilities.

I believe that what’s required is a nimble agility of mind, the ability to look at tables of numbers as nothing more than possibly-accurate signposts, and then to ask what if they’re wrong? The ability to consider what our market would look like if some Galileo were to prove our fundamental axioms wrong.

I’m talking to myself here. I’m the one who resists my child’s reality because it doesn’t jibe with mine. I can be as obstinate as any CMO when someone challenges my numbers-based conclusions.  That’s why I regularly remind myself that business “facts” are often wrong.

So how to function when we’re not sure what to trust or believe?

This new decade, I’ll be trying to dial up my mental agility. What if it turns out that lessons learned from Nickelodeon are more relevant preparation for the unimaginable workplace of 2025 than school or friendship? What if today’s numbers indicating high customer satisfaction with our products are based on a fundamental flaw that is currently camouflaged? What if everything we believe turns out to be fiction, and fiction proves to be a better predictor of the future?

Consider this: a few decades back, smart and capable business leaders could show you well constructed studies predicting a worldwide market for computers of a few hundred units, while wild-eyed hack science fiction writers portrayed a fully wired world. Whose reality was more real?

The model, like Scharmer and Senge’s Theory U, argues that the most effective path from one point (start of sales discussion) to another (closed sale) is often not a straight line. Rather, by spending time in a deep dive through three stages of Learning, Exploring, and Solving, one builds relationship with the client, with the result of a higher close rate.

Here are the 7 steps of SPICIER Selling:

1. Situation: what is the client’s context? How big is her business? What are the trends? What are its products and who are the primary customers? Key: don’t spend a lot of time here. Learn what you need and move on.
2. Problem: what keeps the client up at night? We’re still learning here. We’re open and interested. We want to see the world from the client’s perspective.
3. Implied Costs: now we begin to explore. What is the meaning of the key problem? How does it create ripples through the client’s business in terms of additional problems, lost sales, hidden costs, etc. And how does it impact the client on a personal level? How does it stress him? Might it limit her career if unsolved? Ask how and why a lot. One implication might lead to other bigger ones.
4. Clarify: a lot has been said by now that may not be fully coherent. It is time to make connections and lead the client to new explicit insights. “You’ve said that too many orders get cancelled because they’re improperly entered, costing the company thousands of dollars every month, right? So do you need a simpler system?”
5. Implied Value: once you have identified the real problem, explore what the solution in worth. You may have some of this information through your exploration of implied costs, but the value should go way beyond simply avoiding costs. Again, look at what personal, emotional benefits would accrue from a solution.
6. Explicit Link to Product Benefits: now we begin to solve. Note that until now, we have not gone near what we are selling. Why should we? Customers don’t buy products; they buy solutions to their problem, so it is counterproductive to talk about your product absent clear understanding of the client’s problems and how she might value a solution.  Most products have multiple benefits and feature, so be choiceful here: focus on the benefits most relevant to the client’s needs. Select those benefits that position your solution as superior to options.
7. Resolve: time to close or mutually determine what is required to move to the next step.

All of this is in Rackham’s work, but I find SPICIER a bit more granular and useful than SPIN. What do you think?

1. Who are you trying to reach? Marketing is not about sending out a message. It’s about sending the right message to the right target. Who is your target? Until you know, don’t waste time on a campaign.
2. What is your target’s problem? It’s been said many times, but even the best marketers forget: customers buy solutions to their problems, not products. They don’t care about your accounting software; they want a less time consuming way to organize their data, or more flexible reporting systems. They don’t want your shampoo; they want shinier hair, or easier hair care. Get specific. Who is it, and what do they need?
3. What are their choices, and why is your solution better? How else could they solve problem? Who are the competitors or alternatives? What do competitors do better than you? Prospects almost always have options, so you need to be ready to explain why you offer the best one for their specific problem.
4. What is the most compelling way to talk about your solution? Crafting a compelling message is rarely easy. You need to convey your position (easy fitness program? customized training? ultimate bootcamp?), assert the superiority of your solution, provide a reason to believe your assertion, and hopefully place all that in a context that activates primal emotions. In a few words. You can experiment to evolve your message, but you need a starting point before you launch your campaign.
5. What are your priorities? This has two parts.
   • First, prioritize the media available for delivering your compelling message to your target. Consider that many marketers over the decades have found that it is more powerful to be dominant in one channel than to be merely present in many. Social media may be your best option, but then again, it may not be, and some social media channels may be wrong for your business. You might reach more people with, say, Twitter, but reach more engaged people with, say, LinkedIn. Which is more important for your specific situation? Prioritize your options, and don’t limit them to social media.
   • Second, put your top priority in the context of your overall workload. If you can’t delegate the work, do you have the bandwidth to launch the campaign today? Or would you be better served focusing on face-to-face selling or solving a supplier problem?

Once you have answered these questions, you will have clarity. Maybe that guy trying to sell you his social media program is indeed your best option. But maybe it’s not. Just remember, he’s not going to help you answer these questions. For that, you need to do your own work, or engage an advisor.

• Current Status: will your business be better served by focusing on existing customers or seeking new ones? There is no universally right answer. Many of the leading consulting firms excel at bringing new products to the same set of customers, while a closet organizer must find new clients or die; his current customers only have so many closets.
• Profitability: will your business be better served by focusing on the most profitable customers or improving the profitability of the less profitable ones? Again, no universal answer. Where is the best ROI?
• Satisfaction: will your business be better served by focusing on your most satisfied customers or the least satisfied ones? Can you grow more by deepening an already strong relationship or by improving a weak one?

Analyzing these three dimensions can help focus your strategic choices and marketing plans. You may find that your biggest opportunity, for example, is chasing non-customers who are dissatisfied with your competitor’s product but are not aware of the alternative you offer. Or, you might build deeper ties with your most profitable, satisfied current customers, building a high barrier against potential competitors.

It’s your choice, but you need to make it. That’s what building a winning strategy is about.

But I didn’t read business books or blogs. I unplugged from Twitter. I didn’t write. Cancelled client meetings. Closed for business.

I felt borderline depressed for the first week. I didn’t know who I was. Then one day I woke exhilarated.After that, each night I slept deeply and peacefully, and each day was a playground. I laughed a lot. The worry lines between my brows disappeared. And when vacation ended, I attacked my desk with vigor.

What interests me is that as I write, a week after plugging back in, I still feel light and alive. It’s been an active week with typical stresses, and yet I’m mostly seeing the fun in the work instead of demands.

I feel that by doing nothing, I became better. Is that a general Law of Life? Maybe. Some evidence:

• By taking a 16 year break from skiing, I got better at it. The first day out was maybe my best day ever on the slopes. My technique was rusty, but my confidence was the best it had ever been. 16 years, and I didn’t fall once, despite tackling hills as difficult as any I’d skied in my heyday.
• Whenever I’ve taken a break from commenting on and correcting subordinates’ work, I have always seen them become more productive. When I don’t push them for that extra 5% on any given project, they generate 95% quality on maybe 10% more output – a nice return by my calculations.
• By doing nothing but listening, I help the people around me – my family, my colleagues – find their own answers without any of the defensiveness that often comes when I provide the answer.
• Seeds lay dormant a long time before…pow!
• And of course, as any meditator will tell you, by doing nothing but sitting on your cushion breathing, one can transform one’s life.

I didn’t plan to start the year by being so touchy-feely. I’m just observing a curious phenomenon: often, by doing nothing, one accomplishes much. And anything that drives better results is OK by me.

In a recent post we discussed the need for business leaders to be light on their feet with their business plan. Planning is, of course, a necessary competency of virtually all strong organization. The plan provides focus by summarizing in one easy-to-review document the big bets a business is daring to make (based on careful consideration of the best available information), and an inclusive planning process ensures that organizational efforts are aligned.

But planning is not running a business. Eventually you shift from planning to executing, and at that point the plan ceases to be your creation. It becomes your dance partner. You sometimes follow, sometimes lead, and importantly, you know when it’s time to gallantly bow and walk away. Off to plan again.

The flip side of this flexibility, however, is the organization’s need for consistent goals and objectives and non-negotiable truths. Just because you don’t become attached to your plan doesn’t mean you can allow your sails to luff. Your organization needs to know its course. Sure, you sometimes need to tack right, sometimes left, but you must never lose sight of your destination…and the principles you will follow to get there.

Seeking the middle way – in this case, neither holding on too tightly nor too loosely to plans – is critical. No room for ideologues or extremists. We seek to bring conceptual order to the always-changing mess of competing stakeholders with competing requirements by consistently including them all, listening to them all, honoring them all, and steadfastly resisting pressures to assume them out of existence in the name of expediency.

Only by embracing the juicy complexity of business can we arrive at the best possible solution. Certainly, in the end we must decide and say yes to some, no to others. But here’s the magic: when someone feels she has been heard and her point of view respected, she will generally embrace the final solution however it turns out.

In excellent organizations, it’s not enough that no one opts out of key decisions. Rather, everyone has to enthusiastically opt in. Strong leaders use the principle of inclusive planning to make that happen. They don’t force major decisions in the name of expediency until every one signs on.

Why choose? In fact, Jim Collins argued in Good to Great that the great companies don’t choose. They insist on having it all.

Regular readers know I am a big fan of Jim Collins. However, I have never been completely comfortable with the language he uses when discussing his Hedgehog Concept and the “sweet spot” where excellent companies take germinate and grow.

Here is how I explain it to clients. I’m not arguing with Collins in any significant way, just using different words.

Vision is where you want to go, what you want to achieve, your ultimate goal. This is your sweet spot, because when you think about your Vision and work on actualizing it, you have everything going for you. A powerful Vision is the intersection of three elements: what is meaningful to you, what you excel at doing, and what people will pay you to do. Collins goes a bit further, saying that greatness requires not only excelling but being the best in the world; pursue that if you choose, but I certainly respect those who simply want to be economically comfortable and joyful in their work.

What Matters Most is also defined by three elements: your Mission, your Values, and your Interests. Mission and Values are discussed extensively in Leadership writings, but I believe they are insufficient. Interest is what personalizes this area. Your Mission may be, as an example, to help create a more conscious world by empowering others to be excellent coaches. You may have refined your list of Values to the most salient half dozen. Not enough. You might have no interest in standing in front of a classroom, but have a great interest in horses. This Interest, coupled with the others, might lead you to explore business models for teaching coaching lessons by training others in mastering horses. And yes, that’s a real example. The woman has a thriving business.

Where You Excel is defined by your skills and talents. Skill involves proficiency and dexterity; they can be learned and cultivated. Talent is more inherent, a natural endowment; it’s how we’re wired. If you’re grinding away at something you are not particularly good at and never will be, it’s unlikely you will find fulfillment.

What Makes Money is, sadly, where too many businesspeople start and end. They develop a business model that works. They build strategies that win in the marketplace. These are necessary for a successful Vision, but woefully insufficient.

When these three elements intersect, you can construct your Vision. It’s not linear. It’s not as simple as adding these three together to reach a tidy, inevitable sum. But by understanding these three, you can set the boundaries within which you can begin your vision quest. It lives in there somewhere.

What do you think? Is your Vision well-defined and driving your business and career? Where can you increase clarity?

The fun part comes a couple pages later, where he offers five extra credit questions:

• Has your sense of humor ever gotten you into trouble?
• Has asking questions ever gotten you into trouble?
• Has being unpredictable or too complex ever puzzled or bothered others?
• Has your effort to anticipate problems ever had someone accuse you of having a negative attitude?
• Are you such a good listener your ability to understand both sides of a conflict has confused others?

In other words, are you a rebel or generally curious? If so, congratulations! You are probably more resilient than most.

And you thought those traits only got you in trouble. Looks like they can save your cookies!

Are you old enough to remember how free agency revolutionized baseball in the 70′s? Suddenly the whole concept of “team” was up for grabs. Many of us purists were horrified as the Yankees found they could buy championships by snapping up available stars.

Today, there is no more debate. Free agency is the water all sports teams swim in. And despite our fears, professional sports remain fascinating. Despite rapid turnover of players, teams command loyalty.

Less commented on has been the revolution of free agency in the business world. After brutal rounds of downsizing and restructuring in the 80′s and 90′s, most businesspeople no longer regard their companies as family but rather as stepping stones. And you know what? It’s OK.

To maintain and engage your best performers in this world of free agents, managers must cultivate win-win relationships with employees. But Marshall Goldsmith, in his thought-provoking What Got You Here Won’t Get You There, argues that most business leaders carry prejudices about employees that interfere with developing productive relationships. We relate to them through a web of assumptions and biases, like:

• I know what they want. Do you? Have you taken the time to explore what really motivates your best people? Because the answer is different for different workers. For some it’s money, for some prestige, for some a sense of belonging… The list is long, and in an age of free agency, you need to customize your approach to each employee you value.
• I know what they know. Not likely. Peter Drucker predicted years ago that in the future, the most successful managers would  to know how to ask rather than how to tell. That future is now. Knowledge is too diverse and vast. Accept your limits and embrace your employees’ distinctive expertise.
• I hate their selfishness. Yeah, well, that battle is over. Management betrayed workers by yanking away job stability, and now it’s every person for him or herself. Selfish? Get over it. Give ‘em what they want. You need them to be happy.
• I can always get someone else. Sure. But at what cost? Knowledge and expertise are no longer fungible. Goldsmith recommends thinking of your relationships with top talent more as a strategic alliance than an employment contract. If someone isn’t pulling their weight, let them go. But know who your franchise players are. They can’t be easily replaced.

Despite free agency, your people are still your most valuable asset. It’s just that the rules have changed. Figure out who you can afford to lose, who you need to get, and who you need to keep. Then engage them. Listen to them. Meet their needs. Empower them. Treat them as valuable allies.

Your company will thrive. I guarantee it.

This is my reply to Twitter Trolls and those folks who promise to make you rich and famous if you buy their software, program, or advice. It’s a personal manifesto. It’s what I tell myself when I open Twitter (or HootSuite, my best friend in the world):

• Know what you want. If you are using Twitter as a tactic in your business, then your activities better be driven by goals and strategies. I use social media to build visibility and credibility among the business leaders who matter to me. I do that by providing stimulating business content, including links to my own articles. I measure success by tracking how often I get retweeted, quoted, or clicked on.
• What you tweet matters. Add value or go home. If all you’re doing is blathering about eating a sandwich, or RT’ing tired ideas that anyone who has been to high school has heard before, or hitting us relentlessly with your sales message, or using Twitter as a substitute for email or phone (a public display of half a conversation) … then you are not adding value. Personally, I spend a few hours a week surfing for articles and blogs that I think are outstanding, and always have at least one specific follower in mind when I post the link. My name is on the feed. I’m not going to associate my name with junk. I get some right and some wrong, but I try to keep a pretty high batting average. One tell on quality: if someone has thousands of followers but is on only a handful of lists, caveat emptor.
• How you say it matters. I look for tweeps who have an authentic voice or unique point of view – and yes, you can show that in a series of 140 character messages. Or at least you can clearly demonstrate the absence of uniqueness. Voices that don’t work for me: overly assertive (“The meaning of life is…”), overly sales-ish (“Let me show you how to make real $!”), consistently generic (“Free video” “Good morning world!”), or insane (“My skull is being probed by aliens from the White House”). Also – and this pains me – I do not follow tweeps who primarily post in languages I can’t read; I know, it’s small minded of me…but what would be the point?
• It’s personal! Currently I follow around 1500 tweeps. For the first several hundred, I reviewed each one before choosing to follow. It took a few weeks to get my first hundred followers, and I was delighted the first time I added 100 in under 10 days. But that approach took too much time, so I caved: I got TweetAdder and began automatically following tweeps based on specific criteria. Now I add 80+ followers a day when they follow me back, unfollow at least half who don’t interest me, and lose 30+ when they retaliate to my unfollow. Big whoop. I’m not going to follow someone just to build follower numbers. I have a very specific protocol for selecting who I will follow:
  • If I read an interesting tweet, I check out the sender’s stream. If that interests me, I manually follow and/or list them. I don’t care if they follow me back. I know who they are, and they make my world better.
  • If my auto-follow isn’t followed back in a day or so, I unfollow. After all, I had nothing invested in them, nor they in me.
  • If my auto-follow is followed back, I check them out. If they don’t add value (see above), I immediately unfollow.
  • If they do add value, I send them a personalized DM. With their name. Recognizing their contributions. After all, it’s called social media. There’s nothing social about an auto-follow-back or an automated DM.
  • Bottom line, I’ve researched and feel some level of connection with the 1500-odd tweeps I follow. Some of them have turned into friends. So even with the software, which has introduced me to people I would not otherwise have found, my follow list is strictly person.
• Quantity matters. When I find tweeps who have only tweeted a few times but have a disproportionate number of followers, I usually permanently block them; they’re just playing the follow-back game, collecting numbers without contributing enough value (not always; sometimes they know the limits of what they need to say, in which case you bet I follow them). Conversely, when I find someone with tens of thousands of tweets, I usually block them.
  • Think of it this way: If you had tweeted once every hour since the inception of Twitter, you would have sent around 40k tweets. No one has that much to say. That’s just noise; I don’t want it around me.
  • Also, I noticed that whenever I found a tweep posting several tweets per hour, they were almost always impersonal, a sure sign of automation; almost always I can find someone else posting exactly the same tweets at exactly the same time, because they’ve both been conned into buying some service.
• Quality trumps quantity. Maybe I’m in an odd business. Maybe other folks really do need to play the numbers game. But I’ve tested whether my approach of making it personal helps me achieve my goals better than full automation. The findings were remarkable.
  • First I set up some fully automated feeds. I automatically followed back anyone who followed me. Those accounts gained about 3000 followers in a few weeks, or about double what my real account gained in 8 months.
  • Second, I sent pretty much the same tweets on all the feeds.
  • Finally, I tracked RTs and clicks. So: different number of followers, same material.
  • The results? My real account, the one where I hand pick who to follow and communicate personally with all followers I want to keep, averages over 15 times more RTs and clicks than the automated accounts. Half the followers, fifteen times the results. That’s 30 times more productivity per follow.

I’m projecting to be at 2500 follows within a month, which should be equivalent to the productivity of 75,000 automated follows. So you tell me, should I be impressed when someone brags that they have tens of thousands of followers?

That’s it. Rant over.

I don’t advocate this or any other system for anyone. You need to find your own voice and techniques. That’s the point. But here’s my advice: If Twitter supports your marketing strategy, then define what you want to accomplish with it. Find some metric to track how you’re doing relative to that goal. Set some rules you can live with. Find your unique voice. Build relationships.

And don’t pay anyone who promises to get you a zillion followers without you doing any work.

P.S. – Don’t get me started on automated DMs thanking me for following, generally with some generic self-serving message or link. Don’t get me started…

What do you think about the state of Twitter? What do you do to keep things real?

Yuck.

I sat recently through an afternoon of five presentations where each speaker followed that same template. One in particular galled me. She introduced herself as having 70,000 Twitter followers, and asserted that she was therefore supremely qualified to coach any business person on social media. She then laid out several everyone-must-do steps without ever once raising what to me is the only relevant point of discussion before offering any advice: What are you trying to accomplish? The fact is, many of her suggestions would have been counter-productive for my business goals. Now, it may be that I am pursuing the wrong goals, but by trying to force-feed me her product, she did nothing to help me make that discovery.

Why does it matter to go slow and allow time for insights to simmer? Simply put, different goals require different actions. The more time invested in asking questions and seeking to understand what your potential client really needs, the greater the likelihood that you will find a way to propose the most relevant actions. Conversely, if you jump immediately to a solution for what you assume is the problem, chances are you will miss the point and fail to help either your client or yourself.

Neil Rackham’s terrific SPIN selling method examines this in detail. His research found that the best sales people talk the least, ask the most questions, and take the most time before bringing up their product. By investing time in questioning and probing rather than closing, they create opportunities for their clients to discover a deeper understanding of their most powerful needs. Only when both seller and buyer share insights about the buyer’s true needs can the seller position her product as the best solution for those needs.

Most business people I know would rather have 10 solid paying customers than 70,000 followers. If your market is a numbers game and having 70k followers leads to new customers, terrific! But if your market is more swayed by depth of relationship and customized service, then what’s the point of chasing numbers? In that case, you’ll want to go for quality.

Know your goals. Know your client’s goals. Know when to go slow.

How do you ensure that you offer only what your customer really needs?

[I've posted this before, but it seems an appropriate gift for readers during this holiday season]

Recently I decided to take a snow day. I had just completed a major project, and the prospect of going out did not entice. Over coffee, watching the blizzard, I happily made mental lists of books to read and articles to write.

Eight hours later I gave up.

In between, I rode the never ending wave of email, tweets, news feeds, text messages, etc. I was busy. I felt productive. But it was delusion. I kept up, but went nowhere.

Twenty years ago, I delighted in getting away. Once a boss complained that he couldn’t reach me when I was vacationing. “But it was a road trip,” I pointed out. “You wouldn’t have wanted me calling in from gas stations, would you?” He shrugged and never brought it up again.

Just try that now. Going away? Ha! It’s like you never left. Connected.

We are wired 24/7. It’s good. Connectivity empowers and enables. And it’s bad. Connectivity enslaves. Connectivity deludes and blinds. We get so much information that we know nothing.

I lived in Asia for many years back before the internet, when email meant going to the office, when newspapers in a language I could understand appeared only sporadically, when phone calls were expensive and inconvenient. Back then, I always knew what would happen next in the States. Clinton vs Bush? Obvious. GOP takes Congress? Predictable. Clinton re-election? Bet on it. Predictions could be made way in advance. I called the ’94 election in ’93, and the ’96 election in ’94.

Because with less information, the inevitable is obvious. When we focus on details, we miss the big picture.

We are swept along now in an ocean of too much information and can’t see past the next wave. Each little eddy seems like a tide, so we miss the the fact that all tides are being pulled by a massive gulf stream.

Here’s my New Year resolution: I will regularly unplug for a week. Or maybe occasionally for a day. Or maybe once for an afternoon.

Or maybe not. Connectivity is just so addictive!

• Customers: Have you considered that your customers may have a vested interested in your success? Often they are your best source of insight, feedback, and ideas. If all you are doing is focusing on closing the next sale, you are probably missing an opportunity.
• Competitors: Assume that your competitors are at least sometimes smarter than you. How does that change how you view the world? What can you learn from studying them? What do they do better than you? Or which of their mistakes can you learn from?
• Collaborators & Colleagues: Hopefully, you have built alliances, networks, teams, and relationships. That can include partners, employees, investors, mastermind groups, and friends or family with relevant experience. Invite them in to explore your challenges. They want you to succeed. Listen to their advice without defensiveness. Build on their ideas, and encourage them to build on yours.
• Consultants: Sometimes it’s worth paying an expert to study the situation and propose solutions. Look for leverage – if you pay a consultant $1, you should expect at least $10 of benefit. The right consultant may have the highest ROI of any investment you can make. And sometimes, even consultants can be free via groups like SCORE or your local SBDC.
• Coaches: Everybody calls themselves a coach these days, but often they’re just selling whatever they’re selling. Real coaches have received rigorous training from one of the major business coaching schools. They understand the difference between coaching and consulting, and focus on helping you find your own answers. As soon as you sense a coach is pushing her own agenda, run away. But most certified business coaches have the skills to help you become even more effective and successful.
• Counselors, or Wise Advisors: Seamlessly combining the expertise of a consultant with the training and tools of a coach, Advisors are often your best choice for solving your most challenging dilemmas. They facilitate your exploration like a great coach, but challenge you with their own points-of-view like a great consultant. Just as the President relies on his chief of staff and the head of a mafia family on his consigliere, so a wise business leader turns frequently to his most trusted advisor for guidance.

Even when facing your most difficult decision, help is there. The decision is yours, but that doesn’t mean you need to tackle it alone. Customers, Competitors, Collaborators, Colleagues, Consultants, Coaches, and Counselors – you’re surrounded by angels! C’s the day!

Where do you usually turn for business help?

Peter Drucker, the grand old man of management theory, famously wrote, “What gets measured gets managed.” In other words, Metrics determine what you focus on. After all, who wants a bad report card? If you are tracking your Key Performance Indicators (KPI’s) regularly, you’re likely to find ways to improve them.

Which can be good or bad.

Because if Drucker is right (and he is, he is, trust me on this if nothing else), consider the implication: if you choose the wrong KPI’s, you or your organization will end up getting better at the wrong things. Select with care. There is little benefit in high-fiving over a 10% improvement in gas mileage if you achieved it by driving so slowly that competition is racing past.

Nor is selecting KPI’s a onetime thing. What’s important in a business can change with time. If you get married to a specific set of KPI’s, you might end up missing something that didn’t matter yesterday but is critical today. For example, many startups track sales or clicks or customer ratings obsessively. At some point, however, margin or competitors’ performance might acquire major impact on your ability to survive.

You need to be nimble with your numbers.

And you need to know this: “what gets measured” is not enough. A measure without a benchmark or goal means nothing. Say you sold 1000 widgets last month. Is that good? Was your target 500 or 2000?

So not only do you need to select the right metrics, you also need select the right way to evaluate them.

And that too is not enough.

Once you’ve measured and evaluated, you need to consider the implications. Yesterday is gone. Today’s reality is there in your metrics. Are you still on course? Have you uncovered new opportunities or obstacles? What action should you initiate right now?

For example, suppose you have included Budget Tracking and Revenues among your KPI’s. While reviewing your metrics, you find that spending is on track but sales are coming in ahead of plan. What are you going to do about it? You get to change your action plan. You could take the extra revenues to the bottom line, set up a reserve, or invest in a new initiative. This is not a time for autopilot: make a conscious decision!

It all comes back to Action. All the time. Don’t get fooled into thinking of tracking metrics as an academic exercise you can delegate to puny geeks. Metrics should be a muscular activity, a powertrain driving Action.

What is your favorite method for ensuring metrics drive action? How do you ensure you’re measuring the right things?

So here’s a radical idea: people are different and therefore need different professional development plans.

To which you say, “Duh!”

But have you considered the implications? If the cookie-cutter approach is wrong, what is right? Here are some ideas to consider as you work to develop your people.

• Objectives: Are you dealing with building a functionalist or a generalist? What’s the timeframe? For example, is it more important for this person to be closing more sales within six months or to be ready to assume leadership of a business unit in 3 years? As with everything in business, different objectives will generally lead to different plans and actions.
• Strategies: At the highest level, there are only three development strategies. You need to analyze each employee and prioritize the strategies.
  • Fix a controlling issue – A controlling performance issue is one which is damaging the organization and which, if not fixed, should lead to termination. For example, one of my clients had a brilliant manager who unfortunately had a nasty, unpredictable temper. She had excelled in creating new business opportunities, but had also driven away important customers and driven down her co-workers’ morale. No amount of brilliance could make up for the damage she was causing. Her temper was controlling, and either it had to be brought under control or she needed to be dismissed. There was no value in addressing any other development opportunities until one of those two things happened.
  • Strengthen weaknesses – This is probably the most common approach to development plans. Alice’s review says she excels in three performance areas, is average in four, and is below average in one. Most organizations I have worked with will build the performance plan to address the below average area. My question is this: is it a controlling weakness? If not, consider the next strategy instead.
  • Leverage strengths – Suppose your business is baseball and you have A-Rod on the team. He can hit for power, he can hit for average, and is a fine fielder. Sadly, he’s a lousy pitcher. Are you really going to try to develop him so he can join your bullpen? I think not. You’re going to try to get his homerun production back to his previous steroidal level, or to add another fifty points of on base percentage. You’re going to try to make his strengths even stronger.

Have you ever had an A-Rod on your team, someone who was, for example, the best strategist on your team but was a mediocre analyst? Did her performance plan focus on delivering better analysis or on becoming even better at developing winning strategies? Bottom line, would you rather have a team of players who were average at everything, or one made of stars who could excellently compensate for each other’s weaknesses?

Hint: Teams need to be balanced; individuals do not.

• Life Stage: A newbie might need help gaining the basic skills needed to earn his salary. A veteran might need help getting ready for the next level. One performance plan might be specific and directive, the other general and collaborative.
• Motivation: One person might be working for income. One might be working for recognition. One might be working for internal satisfaction, a sense of purpose, or progress towards some cherished goal. The skilled manager will work to gain insight into what drives each person, and ensure the development plan feeds that motivation.

I hope you agree that a manager who wants to develop his team far and fast would do well thinking long and hard about each individual, then customize accordingly. As a wise spiritual teacher once said, “When I see someone go too far to the right, I tell them to go left. When I see someone go too far to the left, I tell them to go right.”

So it is with development plans: They should reflect each individual’s current reality and future goals.

When in your career did the right development plan make a major difference? How do you approach matching each individual with her development needs?

The action of resiliency is defined by Dictionary.com as “to spring back.” In response to unexpected, adverse situations that might leave others flattened, the resilient person bounces back.

But Nietzsche was only half right when he wrote “Whatever doesn’t kill me makes me stronger” in Twilight of the Idols. Unless you choose to use adversity to become stronger, you can be left wounded and weaker. The resilient person doesn’t passively react to disappointment; instead, she chooses her response, and exercises that power of choice repeatedly throughout her life. Each time she flexes that “choice muscle,” it gets stronger.

The alternative to positive action when things go wrong is reaction. How do we generally react when we get burned? Exactly. We pull back. We run. We avoid. We assign blame. We do everything that is opposite to the resilient response.

It is worth considering how you generally respond to adversity. A loved one leaves. A boss criticizes. A rude comment is posted on your blog. A customer signs with a competitor.

Do you blame? Do you withdraw into self pity? Do you become angry?  Do you focus on the injustice of the situation and your own self-righteousness?

Here are some actions that a resilient person might choose instead (based on work by Al Siebert, Ph.D.):

• Cope: discover ways to accommodate the disappointing turn of events.
• Sustain: invest in cultivating good health and energy in the face of increased pressure.
• Overcome: finding ways to turn lemons into lemonade. Transform the negative into a positive opportunity.
• Change: “Oh well, that didn’t work. I’ll go on to Plan B.”
• Learn: practice new techniques for remaining calm, improve your problem-solving skills, develop new insights into what makes you tick.
• Laugh: come on, there’s always something silly in the worst situation.

My personal poster children for resilience are Jimmy and Rosalynn Carter. When the nation turned them out of the White House, they encountered personal pain, embarrassment, and an unexpected mountain of debt:

On top of their ”rejection” by the voters, they discovered that their warehousing business had gone bad and was piling up debt at a threatening rate. But instead of seeking refuge in some social stratosphere to which their eminence might have given them entree, they returned to their old home in Plains, Ga., they rolled up their sleeves and they began to rebuild their lives by laying a floor in their attic.

They didn’t stop with the attic. Their continued hard work in tackling some of mankind’s most daunting challenges serves as an inspiration to millions.

Perhaps we will never inspire millions. But we can certainly inspire ourselves daily. And sometimes, that will serve as a light for others.

It starts with a choice. An action.

By the way, the verb form of resiliency is to resile. Who knew?

How do you respond to adversity? How do you make yourself more resilient?

Neil Rackham, the guru behind SPIN Selling, points out that the best sales people don’t bring up their solution until very late in the call. They keep asking questions that help both the seller and the prospect better understand not only the most important needs, but more importantly, the implications of those needs. They explore the hidden costs driven by those needs. Then they subtly position their product or service as the perfect solution to those needs, and a great value relative to the costs they uncovered.

I love the SPIN model, although the N (“needs-payoff”) is awkward and can be improved on (see my post on SPICIER Selling, a more granular SPIN). Heck, any marketer who doesn’t love SPIN doesn’t understand marketing. SPIN turns the salesperson into a master 1-on-1 marketer.

All of which is a preamble to my real subject: in the online world, buyers don’t want to be sold to. They want stuff. Useful stuff, often in the form of information. Usually for free. And attempts to change that game generally fail.

Which is why I was so impressed today to find a coaching site that starts with the reader’s needs rather than with selling. The Entrepreneurs Network positions itself as “resources for entrepreneurs, by entrepreneurs.” It is loaded with useful tips, downloads, and software reviews that any newbie entrepreneur would welcome.

So when you discover, several clicks into the site, that their real purpose is to sell coaching services, you don’t turn away. You appreciate how they understand your needs, and are willing to consider whether they are the right advisor for you.

In other words, the selling occurs very late in the call, after they have helped you realize how much you don’t know and have earned your trust.

Now that’s selling!

What are your favorite questions for helping customers discover their true needs?

Have you ever gone to bed smiling because you knew that in the morning someone would hand you an urgent report or confirm a critical meeting or handle a crucial situation? Then not been able to sleep the next night because the big event didn’t happen?

Happens all the time. Schedules slip and no one tells you. People promise to do something and forget. Or maybe hope that you’ll forget.

That’s where Accountability comes in.

Accountabilities determine who needs to do what by when. If those are clear, you can track and measure results versus expectations.

When you are explicit about Who, What, and When, things stop slipping as much. Then you get to sleep well two nights in a row. Is that cool or what?

The keys to effective management of Accountabilities are:

• Clarity
• Communication
• Commitment
• Tracking
• Follow up

Clarity: No room here for vagaries or vagueness (they’re different; look them up). You need to name names, dates, and expectations. Be specific. And for heaven sakes, write them down.

Communication: It does no good for you to achieve clarity and write it down if you don’t let all the interested parties know. Communicate face-to-face, then confirm in writing.

Commitment: It similarly does no good to write it and share it if all you get is a polite smile. Just because you have told Sam that you expect her to have the new accounting system ready to use by a week from Tuesday doesn’t mean that Sam intends to comply. You need Sam to commit and agree. In writing.

Tracking: Not that you want to be paranoid, but people don’t always do what they promised. Sometimes they are intentionally treacherous, sometimes merely absentminded. Either way, you don’t want to learn that the bank didn’t deposit the money in your account until after your checks bounce. Part of skillful management of Accountabilities is having a tracking mechanism.

Maybe you ask for periodic progress reports. Or you establish milestones which, if not achieved, raise questions. Forewarned is forearmed.

Follow up: If a milestone has been missed, don’t let it go without conversation. Conversely, if Who has successfully done What by When, don’t let it go unrecognized. And if Reality changes, don’t forget to consider the implications. What else needs to change? Put it in writing.

Organizations with a culture that tolerates low accountability are often fun for a while. Until they get branded as Losers. No one likes that. Demanding accountability can feel like tough love, but consider the alternative. Help your team win.

How do you hold people accountable? Have you transformed a low-accountability culture into a more successful one?

The highest priority when discussing Priorities is recognizing that there’s not much to say about prioritizing. But what there is to say is important.

Inevitably, as you execute your business plan, you will find yourself overcommitted. Unexpected crises will demand attention. What looked simple will turn complicated. You will unexpectedly discover that your perfect money machine has too many moving parts, and you can’t keep them all oiled. You, the master juggler, will suddenly find there are too many balls in the air.

How to get back in control? If you can’t grow more hands, which balls should be dropped?

You don’t want to wait to decide until it happens, because you will be stressing then and less capable of thinking clearly. Right now, ask yourself, “If I could only work on a few things, which would they be? What is most mission-critical?”

Conversely, if you suddenly have extra capacity, which opportunities would you add to the plan first?

As the leader, your highest personal priorities should be the ones with the most leverage – the ones that have a high ratio of impact to effort.

• High leverage: Impact > effort
• Low leverage: Impact < effort

Drop or delegate the low leverage activities. You’re important. Act that way. Be honest with yourself about your motives. For example, if you are making the coffee at the office to model for your employees the kind of behavior you value, it’s a high leverage activity. If you’re doing it because you don’t want to bother anyone else, don’t you have something more important to do?

Make a list of activities that might contribute to achieving your goals. Rank the items for importance. Be willing to cut loose the bottom-dwellers. When you have new capacity, be quick to add activities that didn’t make the initial cut, or find even more powerful ones.

Live by your list. Review it often.

• There’s always something to learn. Every business is unique, facing unique challenges. Cookie-cutter solutions rarely work because they don’t celebrate uniqueness. Uniqueness always gives me opportunities to learn, grow, get better, be challenged…
• My experience is always relevant. The other side of bullet one is that all businesses share many commonalities. Having acquired 30 years of business experience, I can always find ideas or insights that are relevant. It feels good to add value.
• Business is a discipline for self development. It’s not like there is a border where work ends and life begins. They are completely mingled. By approaching business with the mindset of self development, it can be a marvelous yoga or meditation. Everyday it confronts me with opportunities to become a better person.
• Business lets me serve. I enjoy my life, but that’s not enough. I want to leave this world a better place. Business is my vehicle.

Make sense?

Why are you grateful? How does business help you on your path?

Great leaders have a bias towards Action. They plot their course, set their sails, and point their helm at their destination. They strike a noble pose, appearing to all as masters of their fate.

Except that even the best sailors get blown off course with great regularity.

The Bad News: No matter how good your preparation and decision making, plans never, ever, ever go according to plan. Build your plan knowing that something else will happen.

The Good News: You can correct your course. You don’t want to change capriciously, but it’s good to know you can change actions and tactics without altering your goals. The key to effective Action is staying balanced between sticking with the plan and adjusting with agility. Good plans allow for opportunism.

There are 2 kinds of Actions:

• Proactive
• Reactive

Proactive Actions are preplanned. They address specific objectives and have either an implementation schedule or an identifiable set of conditions that will trigger implementation.

Reactive Actions are responses to conditions. Maybe you anticipated the conditions but didn’t have a plan in place. Maybe you didn’t anticipate. Either way, you’re in Pavlov-land. Something happens and you have no choice but to respond.

We all know that Proactive is good. “Be Proactive” is the first of Stephen Covey’s 7 Habits of Highly Effective People. But sometimes the future is unforeseeable. Even highly effective people can’t pro-act when they can’t see what’s coming. Reactive is likely your only option when dealing with the unforeseen.

Nevertheless, you can proactively strengthen your ability to react quickly and effectively. For example, you can choose to monitor your operations and market conditions vigilantly. Or build communication protocols for dealing with emergencies. Or decide in advance how you will make decisions when faced with the unforeseen.

Future posts will discuss other ways we can relate with the opportunities and obstacles we encounter while executing our plans.

How do you deal with the unforeseen? Is your business prepared for the next 9/11-type calamity?