Category Archives: Transparency

Innovation Starts on the Front Line

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When I first began working for Soundview, I filled back-issue orders in the mail room. We had hundreds of print summaries of top business books, and through our catalog customers ordered them on a regular basis. However, I noticed early on that the order form was not easy to use if you wanted a lot of summaries. There was a series of blank lines on which you had to write the orders numbers, and there was no easy way to indicate if you wanted more than one copy of a title.

So I suggested to our publisher that we ought to change the order form to list each order number, with a space next to it for indicating how many copies the customer wanted of each title. Through this simple change our order volume skyrocketed.

Noel Tichy and Chris DeRose state a simple principle in their new book Judgment on the Front Line:

“In my experience, innovation can only come from the bottom. Those closest to the problem are in the best position to solve it. I believe any organization that depends on innovation must embrace chaos. Loyalty and obedience are not your tools; you must use measurement and objective debate to separate the good from the bad.”

Tichy and DeRose go on to provide a five-step process for leaders to use to build, or rebuild, their companies from the front line so that the ingenuity, innovation, and emotion of thousands of employees can be harnessed.

  • Step 1 – Connect front line to the customer.
  • Step 2 – Teach people to think for themselves.
  • Step 3 – Experiment to implement.
  • Step 4 – Break down the hierarchy.
  • Step 5 – Invest in front line capability.

The authors also bring to the table their extensive experience with companies from many industries that have learned how to harness their front line.

If you would like to learn more about how to harness your front line people to tap their insights and innovative thinking, then you’ll want to join us for our next Soundview Live webinar with Tichy and DeRose on March 27th. They will expand on the five steps, and provide examples of real-world use of these steps in successfully companies.

Perhaps you could even kick-start the process by inviting those who lead your front line people to the webinar. You can fill the room on one registration. Remember that all Soundview subscribers attend Soundview Live free.

Put Power in Your Values

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THE 3 POWER VALUES

PUT POWER IN YOUR VALUES

Johnson & Johnson was once revered as the epitome of a company whose core values had overcome a devastating setback that might have sunk a lesser company. When an unknown assailant poisoned random boxes of Extra Strength Tylenol in 1982, the company’s transparent response became the gold standard of crisis management. By 2011, according to David Gebler, author of The 3 Power Values, Johnson & Johnson had a new and unfortunate identity as a company whose quality was so poor that it had issued a dozen recalls in the last two years alone. It had even been caught in a “phantom recall” — hiring people to surreptitiously take boxes off the shelves so that it could avoid issuing another recall. What happened to the values of the company? Were the executives in 2011 so different from those in 1982?

Roadblocks to Ethical Performance

According to Gebler, while the company had undergone a number of structural and ownership changes since 1982, the core issue was that the company had lost its grip on its culture of ethics and values. This is a common problem, he writes. Executives can be baffled when employees and managers act in ways that are clearly contrary to the culture of the company — or at least what those executives believe to be the culture of the company. In truth, writes Gebler, companies themselves often put up the roadblocks that prevent employees, managers and even executives from behaving the way they should.

The problem is a work environment or culture that pushes employees and managers to unethical or potentially damaging behavior, Gebler writes. A single-minded focus on reducing costs or forcing people to do too much with too little, for example, can cause employees to take dangerous shortcuts. The stated values of a company mean little if the culture is not aligned with those values.

Enabling Values

To prevent a company’s own culture from sabotaging the values and ethics of that company and its people, Gebler advocates the use of three “power” values that, “can influence specific behaviors that will have a positive influence on an organization’s culture.” These behaviors, he continues, “will push and nudge the organization’s goals, principles and standards into alignment.”

Gebler’s three power values are: Integrity, Commitment and Transparency. His use of the word “power” is not related to the amount of power one acquires through these values, but because they are values that enable the alignment described above.

Integrity, he explains, links an organization’s goals (what it says it will do) to its standards (what it actually does). Integrity is built on two dimensions: fairness and consistency on the one hand, and accountability and responsibility on the other.

The second power value, Commitment, links an organization’s principles and its goals, which is often not the case. The organization may have a certain set of principles, but the constraints and requirements of its goals force people to abandon those principles. Finally, Transparency links standards and principles.

The 3 Power Values is filled with real-life examples that reinforce its important lessons. Any manager or executive facing unethical or destructive behavior in the company should look at the corporate culture first before assigning blame.

Check out our full database of business book reviews on the Soundview website.

Lance Armstrong and Credibility

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On Friday, Lance Armstrong was stripped of seven Tour de France titles from 1999 to 2005 on doping charges. The USADA made this decision after reviewing test samples from those years, along with testimony from 10 eye witnesses. Although Travis Tygart, head of the USADA, said that Armstrong might have held on to most of his titles had he cooperated with the investigation, Armstrong declined to do so.

This development is just the final step in many years of accusations and investigations by various officials, and came as no surprise to many. Armstrong has had a checkered past when it comes to his decisions – taking on hero status for his titles and fight with cancer, while at the same time leaving a bad taste for many with the divorce of his strongly supportive wife and the constant doping accusations.

Lance Armstrong is a brand and a company, so what basic principles of business might he look to for guidance? In looking through our extensive library of book summaries, I found Credibility by James Kouzes and Barry Posner. In this book the authors surveyed more than 1,500 managers and 1,000 federal government executives, and from that survey analyzed the key factors that are crucial for good leaders. Here are the four crucial attributes from that analysis:

  1. Honest (truthful, has integrity, has character, is trusting)
  2. Forward-looking (visionary, foresighted, concerned about the future, has a sense of direction)
  3. Inspiring (uplifting, enthusiastic, energetic, humorous, cheerful, optimistic, positive about the future)
  4. Competent (capable, proficient, effective, gets job done, professional)

Kouzes and Posner make the case that credibility makes a real difference in the success of a company. “When people work with leaders they admire and respect, they feel better about themselves.” Quantitative data supports this fact.

The reverse is also true. When people perceive their leaders to have low credibility they are less likely to feel good about themselves, and have lower levels of attachment, engagement and ownership.

In the case of Lance Armstrong, Tygart may have put it best. “The agency would’ve reduced Armstrong’s punishment ‘if he would have been truthful and willing to meet to help the sport move forward for the good,’ Tygart says. ‘Of course, this is still possible and we always remain open, because while the truth hurts, ultimately, from what we have seen in these types of cases, acknowledging the truth is the best way forward.’” Perhaps there is a way forward for Armstrong, to regain his credibility.

*Other books on this subject include What Matters Now by Gary Hamel and Derailed by Tim Irwin.

The Importance of Storytelling in Business

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 Jesus was having a discussion with a religious leader. When told that he might enter eternal life if he loved God and loved his neighbor, the man sought to justify himself by asking Jesus who his neighbor was. Jesus replied with the parable (story) of the Good Samaritan. Even though this conversation took place over 2,000 years ago, this story has become one of the best known stories of the last two centuries, even among those that have never read the New Testament. Jesus knew the power of the story.

Stories have always been a part of business communication, but in the last several years a trend has developed around the power of storytelling in business. I found over a dozen business books written in the past decade that specifically teach the importance of storytelling in organizations, whether to improve leadership, to help focus meetings, to sell more effectively, or to build strong teams. There is even a National Storytelling Network.

Robert McKee put it this way in the Harvard Business Review: “A big part of a CEO’s job is to motivate people to reach certain goals. To do that, he or she must engage their emotions, and the key to their hearts is story.”

Storytelling is no longer just for CEOs, but the key truth is still the same – storytelling engages the emotions, assisting the speaker in communicating his or her point effectively. In Resonate: Present Visual Stories That Transform Audiences, Nancy Duarte expands this point. Information is static; stories are dynamic – they help an audience visualize what you do or what you believe.

Patrick Lencioni has perfected the art of storytelling in his series of business books, including The Five Dysfunctions of a Team, Three Signs of a Miserable Job, Silos, Politics and Turf Wars and Getting Naked. Lencioni uses the fable as a way to engage the minds of his readers, communicating the business truths through the characters of the fable.

In The Story Factor, Annette Simmons introduces six story goals:

  • “Who I am” stories – stories that reveal something about how you are.
  • “Why I am here” stories – to reassure the audience about your intentions.
  • “The Vision” story – to transform your vision into the audience’s vision.
  • “Teaching” stories – to communicate certain skills you want others to have.
  • “Values in action” stories – story lets you instill values in a way that keeps people thinking for themselves.
  • “I know what you are thinking” stories – in a story you can identify potential objections and disarm the audience as you build credibility.

Perhaps it’s time to develop your own storytelling skills. The resources above will help and you can read more in our Executive Edge newsletter Learn the Art of Storytelling.

How Does Your Company Rate?

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Although we’re seeing some slight improvements in our economy in recent weeks, we still have a long way to go to a full recovery. However, some are looking beyond the present crisis and see signs of a strong economy in the future – that is for those that make the grade.

In Good Company, Laurie Bassi and her co-authors make the case that to succeed in the future a company will need to meet the criteria for what they call a “good company.” They have developed a rating system (The Good Company Index) which takes into account certain criteria that are becoming essential in the new economy.

  1. Good Employer – they use a starting number based on ratings from Glassdoor.com and the Fortune list of 100 best companies.
  2. Good Seller – they use the consumer ratings of wRatings regarding quality, fair price and trust.
  3. Good Steward – they based this on statistics regarding a company’s record on the environment, penalties/fines, restraint in executive compensation and contribution to society/community.

As they state in their book, “A good company is one that starts with good intentions and then puts those into practice concretely through its actions in these three areas. Is your company good or moving toward good?

If you think that your company may not rate well and would like to move it up the charts, join Laurie Bassi and co-author Ed Frauenheim for our Soundview Live webinar Business Success in the Worthiness Era coming up on March 1st.