Archive for the ‘Decision Making’ Category

3 Business Lessons Learned from the Penn State Scandal

Monday, November 28th, 2011

The Penn State scandal has been all over the news these past few weeks and it got me thinking. I wondered how such a respected and seemingly professional establishment could have allowed this situation to go so far. How did these secrets stay buried for so long and how could an organization with such moral conviction let these decades-long accusations fester in the dark without follow-up?

Looking from the outside in, I can only assume that the internal communications and processes for handling crises are severely flawed on many levels. Here’s what I think we as business leaders can all learn and apply to our own organizations after watching the Penn State scandal unfold.

1. The truth will always come out.
It’s the golden rule of public relations: attempting to hide a negative, potentially damaging situation within the company only makes it worse. By trying to bury the accusations against Sandusky, Penn State made the entire situation far worse by being exposed after it festered beneath the surface for years. I’ve seen it happen in many organizations. If someone in your organization—I don’t care who it is—is involved with something unethical or illegal, it must be dealt with immediately. Damage control processes need to be activated with your corporate communications folks and a crisis plan needs to be created. Because the truth will always come out, even if after many years in hiding.

2. The open-door policy must be lived, not just talked about.
Most companies have an open-door communication policy but many don’t live up to it. In the Penn State situation it was clear that Sandusky’s improprieties were witnessed and reported to superiors. Nothing was done about it. But something made the whistleblower stop there. Was he told to let it go? Was he made to feel like a detractor for blowing his whistle? Whatever the case may be, we can all learn that when an employee comes forward with something it must be taken seriously and there must be absolutely no element of discouragement or retribution for being the one that came forward. An open-door policy that is lived is one that instills a sense of comfort and safety for employees that need to bring bad things to light.

3. No one is immune from responsibility.
Joe Paterno is probably the most loved college coach of all time, and clearly a pillar of the Penn State organization—not just the football team. Yet even he is not immune from doing the right thing when faced with a difficult situation with one of his employees. All leaders should take this to heart. As a leader, you are responsible for the wellbeing of your company first. Personal relationships must take a back seat to the law.

Have you ever faced a difficult legal or ethical situation in your professional life? How did you choose to deal with it?

Howard Shore is a business growth expert who works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at www.activategroupinc.com or contact Howard Shore at (305) 722-7216 or shoreh@activategroupinc.com.

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Did you Hire the Right People for the Wrong Job?

Monday, November 14th, 2011

In my line of work, I see a lot of what I like to call “organizational mismatch.” I see it often, especially in companies that have experienced significant growth in a short amount of time. What it means is that you have the wrong people with the wrong skill sets for their positions. (more…)

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Successful Sales Techniques: It’s All Semantics

Monday, October 3rd, 2011

As a long-time sales consultant, I have seen it all when it comes to unpolished sales technique. Of course every industry is different, but industry has almost nothing to do with the tried-and-true tactics of the most successful salespeople within it.

When coaching salespeople, I help them refine their process to encourage dialogue and create more opportunities to get the prospect engaged enough to say ‘yes’. One of the most overlooked skills that can make a real difference in sales success: semantics.

You read it right. Word choice is huge for salespeople. The way you speak to prospective clients can make the difference between closing and not closing the deal. Here are some useful phrase substitutions that will project an air of professionalism and polish that will build authority, encourage dialogue and help close more business.

INSTEAD OF…                                            USE:

Who is the final decision maker?  Who else, besides yourself, is involved in making this decision?

Do you have any questions?         What questions do you have?

Keep us in mind for the future.   When can we further discuss moving forward?

Is now a good time?                      I’m glad I was able to reach you.

Do you have any pet peeve statements or sales don’ts?

Howard Shore is a business growth expert who works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at www.activategroupinc.com or contact Howard Shore at (305) 722-7216 or shoreh@activategroupinc.com.

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Performance and People

Friday, September 30th, 2011

In a recent article The Success Equation, we are shown what is apparent to most company heads and team leaders: that both performance based decision making and people-based decision making are necessary to the production and bottom line. If we know this to be true, why do we continue to focus on the performance-based data? As if that data could exist without the people behind it. Taking a look at Nilofer Merchant’s article is a good start to figuring out why and how to begin changing that. If you need help changing your focus, we can help.

Howard Shore is a business growth expert who works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at www.activategroupinc.com or contact Howard Shore at (305) 722-7216 or shoreh@activategroupinc.com.

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Make a Decision

Friday, September 16th, 2011

Decisions, decisions, decisions…who’s making them in your company? Do you have a good decision process and are the right people involved in the decision making? Are they being made in a timely manner? Are they good decisions? If you find yourself mired down in a bog of disappointment by the answers to these questions, the following reasons may be why:

  • There is a lack of good decision-making processes for key decisions.
  • Too much time is being spent on matters that are unimportant.
  • Not enough time is spent on matters that are critical.
  • Companies fail to make decisions regarding critical matters.
  • Senior management involves itself in the wrong issues.
  • Many decisions should be delegated to lower tiers, but senior management does not delegate responsibility.

Does any of this sound familiar? To start pulling yourself out of that bog of disappointment, there is a framework that we have come up with to guide you through the decision-making process:

For all decisions, 12 questions should be asked:

  1. What is the goal in the decision?
  2. What are the consequences/costs of making a bad decision?
  3. Why am I involved in this decision?
  4. What is my role in this decision?
  5. Do I (we) have the expertise to make a proper decision?
  6. What criteria should we use to make a good decision, and how will we rank and weight them?
  7. Are there proven tools to help us make this decision?
  8. Who else should be involved in this decision, and what rile should they play?
  9. How much information is appropriate for this decision?
  10. How much time should I spend on this decision?
  11. How long am I willing to wait to make this decision?
  12. How many alternatives should be considered?

By using this list, one can help avoid making major decisions without taking proper precautions. The list also helps balance risk, time, and cost.

Howard Shore is a business growth expert who works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at www.activategroupinc.com or contact Howard Shore at (305) 722-7216 or shoreh@activategroupinc.com.

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6 Ways to Improve Growth by Hiring the Right People

Thursday, July 7th, 2011

By Howard Shore

There are 6 ways proven to maximize a company’s growth potential through its people:

  1. Improve Your Interviewing Skills – Dr. Bradford Smart is a guru in hiring the right people. His program was used by Jack Welch and, to my knowledge, is the most used in Fortune 500 companies. Dr. Smart’s Top Grading process teaches unique interviewing and hiring principles, practices, and processes. You can access their information on DVD at Top Grading Tools so that your company can use these same strategies.
  2. Assessment Tools – Using assessment tools in the hiring process can increase your hiring success fivefold. The best tools allow you to create customized benchmarks for both your organization and the position you are hiring for. As you screen candidates, they take the assessments online and are compared against the benchmarks. We help our clients use Objective Management Group’s  assessment tools for salespeople because these tools are 95% predictive and are the only tools we have found to be focused on salespeople.  For all other positions, we also recommend Innermetrix as they focus on the behaviors, values, and skills of the ideal hire. There are a lot of good tools out there – some a little better than others – but the most important recommendation is to use something.
  3. No Compromising – It is very common, particularly in smaller organizations, for leaders to justify promotional and hiring decisions based on time constraints, market limitations, or some other self-limiting issue.  In other words, the decision-maker will hire or promote a less-than-ideal candidate based on a short-term constraint that may or may not truly exist. However, even when a real constraint exists, the long-term benefit to the company is most times best served if diligence and patience prevail.
  4. Pay Above Average Wages – When considering trends (e.g. aging, education, competition, inflation, globalization, etc.) you compromise your ability to compete in the future unless you are willing to pay better-than-average wages. The best will always be able to get paid more than the rest. It would be better to be ahead of the curve on this front. Your goals over the next five years should be as follows: 1. double revenue per employee, and 2. increase wages by 50%.  My prediction is that companies that have strategies to keep wages low at the front lines and in their factories are going to continue to be disappointed with their productivity.
  5. Provide More Training – The first thing that companies do in a downturn is cut training. There should be no surprise that employee and customer dissatisfaction soon follow. Top-performing companies do not slow down training; they increase it. Every company should require a minimum number of hours of training per year for each worker. Achievement of training quotas should be reflected in performance evaluations and affect whether or not someone can be promoted. The results of training are measureable in terms of employee retention, employee productivity, employee satisfaction, and customer loyalty.
  6. Provide Coaching to Executives – Right Management Consultants revisited a detailed study on the benefits of business/leadership coaching. The study examined results realized by 100 executives/managers, mostly from Fortune 1000 companies, who participated in coaching programs that typically lasted from six months to one year. They reported that the employers received 6 times the value to their bottom line of the cost of these programs. In addition, the companies that provided coaching programs to their management and leadership teams realized improvements in productivity, quality, organizational strength, customer service, and shareholder value. They also received fewer customer complaints, and were more likely to retain individuals who received coaching. Individuals who received coaching reported experiencing better relationships with their direct reports, immediate supervisors, peers, and clients. They also reported better teamwork and job satisfaction, reduced conflict, and renewed organizational commitment.

Howard Shore is a business growth expert that works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at www.activategroupinc.com  or contact Howard Shore at (305) 722-7216 or shoreh@activategroupinc.com .

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Drawing the Wrong Conclusions

Thursday, June 9th, 2011

By Howard Shore

 

It is often said that numbers don’t lie. While the numbers in your financial statements are correct, the conclusions you draw from them may be wrong. (more…)

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Are You Properly Engaged in Critical Decision Making?

Thursday, June 2nd, 2011

By Howard Shore

I received an e-mail from a good friend and colleague who was having trouble helping a client make a critical technology decision. I received it because we shared the client, and she did not know what to do. I am changing the names “to protect the innocent” and think a lot can be gleaned from this person’s experience. We are going to refer my colleague as Anna and our shared client as Mike.

Anna’s technology consulting firm is supposed to help Mike choose a new software system for his company. Mike decided to hire Anna because it was obvious from the start that he did not have the knowledge or experience to make the decision himself, and no one in his company did either.

As a little more background to the story, Mike actually had done a little research and was already fond of one software system he had seen. Not because he had done exhaustive research. It was just that he felt this system was much better than what he had, and it was on a “cloud.” The salesperson had done a really good job of selling him, and Mike was really convinced that moving all of his computing to “the cloud” was the best decision for him.

I’m using the software brand names because I’m not offering an opinion about their value. They just happened to be the brands presented to Mike for consideration.

As we all know, each circumstance is unique and requires a good expert to help us make the right decision. I am sharing this scenario with you because I see this decision cycle play out time and again. The consequences can be dire because invariably people make decisions for the wrong reasons, and the decisions are often bad!

The following is the e-mail I received.

We had a demo of SAP on Friday afternoon. Unfortunately it got started a bit late due to Internet problems in their office. It caused a bit of a time issue as they had their holiday party later in the afternoon.

Mike stayed at the beginning of the demo, but towards the middle, he walked in and out (even changed his clothes). He seemed to like the solution until he heard the pricing, which surprised me. It costs more than NetSuite, but it’s still very much a reasonable alternative. Once I got to the bottom of it, it turns out that he believes that NetSuite is going to give him a free year! I’m not sure what planet that would happen on, but it’s not this one.

As I told him before concerning costs, this is the best time of year to shop for an ERP system. All solution providers are giving nice discounts, but they still need to make deals that work for themselves. I’m a firm believer in everyone shaking hands on a deal that is fair to all. I’m hopeful that he feels the same, otherwise none of these solutions will work.

Once he heard the pricing (see below) he decided that SAP was only a step up from QuickBooks. I’m not sure how he came to that conclusion. I’ve come to believe that his MO is that when one thing is wrong, it’s all wrong!   

He was also upset that none of the pricing included an eCommerce integration (which was very deliberate on my part). I had spoken with his colleagues and indicated that, because their operations are so manual, we would do a phased implementation. I am very concerned that if we implement everything at once, we are setting ourselves up for failure. I only wanted to be certain that whichever solution we decided to implement, we would have the capability to add eCommerce. I am currently getting eCommerce pricing for them, but I highly recommend that we delay eCommerce until phase II.

In terms of pricing, over 5 years, the numbers are (not including eCommerce):

NetSuite                                   136K

SAP                                          161K

SMB Suite (Great Plains)           240K

FYI; I sent Mike an e-mail yesterday giving him a link to a demo for SAP that he could watch at his leisure. That way, if he loses interest he can start and stop it. I also offered to have a second demo on Friday morning addressing his concerns and/or open issues. I have yet to hear from him.

I will keep you in the loop.  Any suggestions would be welcome.

Just reading the e-mail, there are several decision traps.

  • How engaged does Mike appear to be in learning about his options?
  • It appears that they have not agreed on the process they will use to make a decision.
  • It seems they have not agreed on all the criteria for making a decision. Going through this process helps establish Anna as the expert and lets Mike know what he should look for as he goes through demos. They also need to agree to rating systems for each item. Without these steps, doing demos is a waste of time.
  • Have they ranked the different criteria? Everything cannot be equal!
  • Did they agree up front on Mike’s budget expectation? It appears that Mike wants everything for free.
  • Is Mike the expert, or is Anna? It appears to me that Mike sees himself as the expert.
  • Was Mike going through the entire process with an open mind or was he looking for validation for choosing the product he looked at on his own? This is a major expenditure for Mike and is critical to his operations. By his behavior during the demo, it appears his mind was made up before the demo started. I would call him on it.

Mike is not committed to the process that Anna has established and obviously had some preconceptions in his head. He will probably not click on the link to the demo she sent. Even if he does, will not look at what she would want him to look at, would not know how to rate and compare things to NetSuite, will not rank things the same way she would, and I can predict the outcome. Without an open mind and proper engagement he will end up choosing his original choice, NetSuite, which may or may not be the best choice for his company.

Howard Shore is a business growth expert that works with companies and people that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at www.activategroupinc.com  or contact Howard Shore at (305) 722-7216 or shoreh@activategroupinc.com .

 *Reprint

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Avoid Emotional Decision Making

Tuesday, April 26th, 2011

By Howard Shore

Too often leaders make their decisions based on emotion, and it causes them to ignore all of the facts that are put in front of them. While it is true that we often have incomplete information when making a decision and that many of the decisions we make in business have no perfect answer, it does not mean we should throw away all the data and evidence that is available to us. In addition, I find entrepreneurs are particularly prone to being impatient and not giving new ideas and processes enough time and effort so that they can properly take hold. Here are two real examples from the last two days.

I have a client that hired us to help them improve their sales force. Historically, they have very mixed results in recruiting people, and it is evidenced by the fact that only 25% of their people perform at an acceptable level. As a result, the owners were very interested in implementing our Sales Talent Acquisition Routine (S.T.A.R), which, when implemented properly, has a 95% success rate for hiring good performers. 

Two weeks into implementation of the process, the owners informed me that they had a great candidate they talked to and wanted to hire. To my dismay, they wanted to exclude this person from the S.T.A.R. process. I explained to the owners this would actually violate discrimination laws since we were already interviewing other candidates under the new process. I also shared with them 3rd party validated statistics that indicated that if we confirmed the person hirable there was a 95% chance they would be successful, and if we confirmed them not hirable, there was 75% chance they would fail. An owner who was not in an emotional state would immediately want the candidate to go through the process to have the higher comfort level. These owners were so excited about this candidate that they told me that it did not matter to them whether or not the process validated their conclusion. They (the same team that has 75% percent failure rate in the past) had already made up their minds to hire the person. 

Another similar scenario was a company where the owners did not follow a process properly. The outcome of the process was not what they wanted. They rushed through implementation and failed to have the discipline to take the time to get it right. So rather than go back and diagnose what happened, their conclusion was to revert to their original unproductive process. Had the owners taken a closer look at the situation they would have realized that they had not given the new process enough effort and had failed to implement it in the right way. So now they’ve wasted money and time on the new process and will continue to not get the outcome they want because they will fall back to the old process that was not working.

In both companies the main culprit was allowing emotion to take control of decision-making. While we need emotion to help us get motivated to change, we cannot forget about logic. It is imperative when embarking on a new process or program that the management team is committed to the decision and will take the time to make sure that all of the available factors are being considered and that proper time is allowed for the changes to take hold. Many times all that is needed is some fine-tuning to achieve great results, but people stop before they reach the finish line.

Howard Shore is a business growth expert that works with companies and people that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at www.activategroupinc.com  or contact Howard Shore at (305) 722-7216 or shoreh@activategroupinc.com .

 *Reprint

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Commitment is Rare

Thursday, March 17th, 2011

By Howard Shore

Many people think that making a decision is the same as making a commitment. This could be the farthest from the truth. Actually, the hardest decisions oftentimes have the weakest commitments, particularly the larger the group size.

Does this scenario sound familiar to you? More than a year is spent thinking about something; maybe even a committee is created to evaluate it. Consultants are hired; friends and colleagues are conferred with. Money is spent for market research, and finally an affirmative decision is made. The project, system, process, or other decision is placed into action, and all of a sudden the inevitable happens – problems arise – big problems, little problems, and attitude problems.

What happens to most people’s level of commitment when faced with these problems? Rather than addressing the problems, they ignore all of the thought that went into making the decision and allow emotion to take over. Their commitment to the decision it took them a year to make crumbles, and with it the chance of following through on the decision.

Commitment is often missing in many organizations. Many times it results from a lack of healthy debate in meetings or because a leader or leaders discourage opinions that differ from their own. Many decisions are the result of false consensus and weak buy-in. By having productive conflict and tapping into everyone’s perspectives and opinions, everyone can confidently buy in and commit. Even those who voted against the matter at least know their issues have been heard and considered. 

Another issue that arises and hurts commitment is consensus building. Great teams know the danger of seeking consensus and certainty and find ways to achieve buy-in from the rest of the team. The leader’s role is to demonstrate decisiveness and to communicate awareness and acceptance of the fact that some decisions may turn out wrong. He or she must push decisions around issues, as well as adhere to schedules that the team has set. The leader must cascade messaging to key people in the organization to support follow-through on decisions so that everyone is clearly aligned.  The leader must not show weakness in making decisions and take action when fellow leaders show a lack of support.  Particular attention should be given to those people that take passive-aggressive approaches to undermine decisions. I have low tolerance for this type of behavior, because for me, a failure to strongly support the decisions of your leaders is the equivalent of helping the competition and is a form of dishonesty. If these people want to help the competition they should go work for them.

IF YOU MAKE A DECISION, MAKE A COMMITMENT!

Howard Shore is a business growth expert that works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at www.activategroupinc.com  or contact Howard Shore at (305) 722-7216 or shoreh@activategroupinc.com .

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