Managing By Values

Many years ago, I heard John Naisbitt give a speech on his book Reinventing the Corporation and was intrigued by a concept he called “Fortunate 500” companies. We all know about Fortune 500 companies that are ranked on revenue, profits, and market value. But John defined Fortunate 500 companies as organizations measured by the quality of service available to customers and the quality of life accessible to its employees.

Over the next few years, I worked with several people to put a process to this idea. The result was the book I coauthored with Michael O’Connor, Managing By Values. The three elements of the Managing By Values process are:

  1. Identify your core values
  2. Communicate the core values
  3. Align the values to your business practices

The most important part of this process is to decide what is most important to your company. Once you gain that clarity and define your core values, you must constantly communicate them to your employees. Use the values as a guidebook for how you make decisions and operate on a daily basis to show employees that you are completely committed to them. And make sure that your internal business practices are aligned with your values so individuals and teams can function easily and not hit road blocks because an internal process doesn’t support the values.

When you manage by values, you’ll have delighted customers who keep coming back, inspired employees who give their best each day, owners who enjoy profits made in an ethically fair manner, and suppliers, vendors and distributors who thrive on the mutual trust and respect they feel toward your company.

We certainly found this to be true during the economic downturn of 2008-2009. It became clear to us in February 2009 that we would probably fall, at a minimum, 20 percent short of our revenue goals for the year. The first thought of some was that we would need to downsize—get rid of some of our people. While that would be legal, we didn’t think it was consistent with the rank-ordered values we had at the time. Our #1 value was Ethics—doing the right thing, followed by Relationships—gaining mutual trust and respect with our people, customers, and suppliers; followed by Success—running a profitable, well-run organization. To us, downsizing would focus on our #3 value but miss doing the right thing and damage our relationships with our people. As a result, we involved everyone at an all-company meeting and together figured out how to cut costs with a minimum impact on people’s lives.

Fortunate 500 is a clever play on words but it is actually a very powerful concept—and perhaps even more important now than it was when I first heard about it. Today people, especially millennials entering the workforce, want to know that their work is worthwhile and they are contributing to a bigger cause. If employees share the common values of a company, they can achieve extraordinary results that give their organization a competitive edge.

Coaching—the Most Essential Part of Performance Management

Performance management has three elements—planning, day-to-day coaching, and evaluation. When I ask managers which of these elements takes the most time, they almost always say evaluation. Sometimes I hear long statements full of frustration about the forms, activities, and deadlines involved in the evaluation process. It makes me realize that people are putting the emphasis on the process—not the performance. And that is where many managers make the wrong choice.

Effective managers should spend most of their time on day-to-day coaching. Let’s take a closer look.

As a leader, it’s true that you have to spend time up front to set clear goals. Once you’ve completed that part, however, your job is to be there to coach your employees and help them accomplish those goals. I think of it as turning the traditional hierarchical pyramid upside down so that you work for your people. You are there to help them.

If you spend most of your time coaching your people and helping them succeed, what do you think happens when it is time for the evaluation? You get to celebrate accomplishments! When you help your people win, you win, your department wins, and ultimately your organization wins. That’s why I say coaching is the most essential part of performance management.

Coaching: The Key to Being an Effective Manager

Why is it important to use coaching skills if you want to be an effective manager? Because when people get the coaching they need, they perform better. Managers who provide day-to-day coaching have more effective teams, grow and retain their key people, and experience higher productivity overall. Makes sense, doesn’t it?

Over the years when I’ve asked people to describe their best boss ever, they often say it was a manager who helped them be successful in their role through coaching. It is important to set clear goals with your people, but it is critical to then use coaching skills such as

  • asking what they need from you to reach their goals,
  • listening with the intent to learn, and
  • working closely together to solve problems.

Coaching is the key to building a trusting work environment and improving the competency of your staff. Remember, your most important job as a manager is to help your people succeed.

In the short video below I share a story of how, as a college professor, I used coaching skills to help students get an A in my course.

Please give coaching a try. I know when you make coaching a priority, you’ll help your staff improve performance levels.

 

The Simple Truths of Service

When was the last time you received customer service that was so great you wanted to tell others about it?  Okay, now what about the last time you had a really bad experience as a customer? My guess is that the bad experience will pop into your mind a lot more easily than the good one.

People have always shared customer service stories, good and bad, with each other. But as we all know, these stories are no longer confined to a small circle of friends. Social media has made it easy for both kinds of stories to be shared with hundreds or even thousands of others with a few keystrokes. And many people make their buying decisions based on reviews they find on websites. So as a business owner or manager, how can you ensure you are delivering service that delights your customers so much that they want to brag about it to their friends?

Through the years I’ve learned how even the smallest effort or the simplest change in policy can make a positive difference to an organization. That’s why I’m so excited about the re-release of The Simple Truths of Servicea charming little book I wrote with Barbara Glanz. It is filled with true stories about simple acts of service that build customer loyalty. Barbara and I collected these stories over the years and compiled them into an easy to read book that will spark your imagination about how simple it can be to create loyal customers. It will inspire you to realize that every single person in your company—even you—can make a difference.

The first story is the heartwarming tale of Johnny—a bagger in a grocery store whose one act of kindness transformed the level of service in the entire store. It is proof that a simple message from the heart can sometimes have more power than a company-wide marketing strategy. More true stories follow—all great examples of heartfelt, caring service that turned regular customers into raving fans.

I’ve said for years that if you don’t take care of your customers, somebody else is waiting, ready, and willing to do it. The best competitive edge for a business isn’t their product or their price. It’s how they treat their customers. Make a point of giving your customers a service experience they will remember and share with their friends. You may end up with a story you can brag about!

Learn more about The Simple Truths of Service, or order your copy at Amazon.com.

 

Building a High-Trust Work Environment

Building trusting relationships is one of the most important elements of being an effective leader. The good news is that turning around a low-trust environment isn’t rocket science. It starts with performance evaluation. If you are evaluating your people’s performance with a judgmental mindset, I guarantee you are eroding trust.

But if you partner with your people to set clear goals, and then provide day-to-day coaching to help them reach those goals, you’ll build high levels of trust—and that leads to higher morale, increased productivity, and improved engagement. And, as a leader, the constant communication you have with team members makes the performance evaluation part of your role much easier.

Remember, placing an emphasis on judging performance instead of coaching performance will create a low-trust environment. Setting clear goals and working side by side with your people to help them do their best will not only build trust and create effective teams, but also form the kind of working environment where people flourish.