Creating Bench Strength for The Future

Right now, we live in a world which is complicated and complex. There are multiple variables to monitor and few point a clear pathway to the future. Furthermore, we as leaders are surrounded by strategic choices that potentially have dramatic short term and long term implications. 

The upshot of this kind of environment is that we need a high degree of collaboration and teamwork to be successful. However, some things are not working out like they used to. People and teams just don’t seem to be functioning very well. Struggle in the world of leadership and organizational change is the new normal.

Why?

First, “Today’s teams are different from the teams of the past”, notes Martine Haas and Mark Mortensen in their article “The Secrets of Great Teamwork”, Harvard Business Review, June 2016. As they explain, “They’re far more diverse, dispersed, digital, and dynamic (with frequent changes in membership).” They call these kinds of teams, “4-D teams”.

Second, we have been so busy pushing performance on a day to day basis that we have created a generation of operational focused leaders. These individuals can make sure the trains run on time, but they can not successfully understand where the future is going and how to get there. They zoom in to focus on details when they should zoom out to see the bigger picture.

Third, many managers and leader do not understand the difference between change and transformation. The former is about doing things better while the later is about doing things differently. Each require a person in a leadership position to engage with people in a different manner.

Whether we are leading 4-D teams or seeking to lead organizational transformation, having the right people in the right positions is becoming more critical to our success. Furthermore, having them trained and ready to go before problems arise is clearly an advantage. In short, every successful organization right now knows it needs to have great bench strength in order to be successful over the next three to five years.

One solution to these current difficulties is to sign up your key leaders for the 2017 From Vision to Action Leadership Training. Through a challenging, interactive curriculum which blends lectures, selected readings, small and large group discussions, and how to skill-building exercises, participants in this four part leadership training gain critical knowledge and skills which improve their ability to lead people to generate short and long term success.

For more information on this in-depth training and how to register for the 2017 From Vision to Action Leadership Training, please click on the following link: http://www.chartyourpath.com/VTA-Leadership-Training.html 

Today’s problems are not going away. Future technical and adaptive problems will keep coming. However, having a strong bench of qualified and well-educated leaders will position the company for short and long term success. Sign up today and be prepared. The future is just around the corner.

Geery Howe, M.A. Consultant, Executive Coach, Trainer in Leadership, Strategic Planning and Organizational Change Morning Star Associates 319 - 643 - 2257

Reinforcing Clarity Through Systems

The need for and challenge of strategic adaptability and evolution is not going away any time in the near future. Sooner or later, each of us will need to transform our organization in response to market shifts, introduction of new technologies, arrival of new low-cost competition, or in response to state or federal changes.  What we have to realize first is that such a transformation is really two transformations, namely Transformation A - the adaptation of the core business to the realities of the disrupted marketplace, and Transformation B - the creation of a new disruptive business that will become the company’s next source of growth.

At the exact same time, both transformations will require the sharing of resources without interfering with each transformation. Clark Gilbert, Matthew Eyring, and Richard N. Foster in their article “Two Routes to Resilience: Rebuilding your core while you reinvent you business model” in the December 2012 issue of the Harvard Business Review calls these shared resources a “capabilities exchange.” Now, we need to remember that individual competencies refer to a specific person’s knowledge and skills required to fulfill specific role requirements. Organizational capabilities, on the other hand, are collective abilities of the firm required to execute the business strategy.  

As the above authors note, “The goal of transformation A is to find the strongest competitive advantage your current model can sustain in the disrupted market place.” As they continue, “Too often companies ... focus only on preserving their margins by reducing costs.” Their example of this is Borders closing store after store in response to Amazon, “vainly hoping to hold on to its profits by shrinking.” 

A broader view is needed with new strategic questions when dealing with this level of transformation. As they suggest:

- “What can we still do better than both our traditional rivals and the upstarts?”

- “What must we give up?”

- “Why do our customers come to us?

- “What is the real need that connects them to our brand?”

The second transformation has a different focus. As they write, “To realize their fullest growth potential, incumbents need to embrace the possibilities of the new marketplace as energetically as the disruptors do. That’s the purpose of transformation B.” To do this successfully, do not ask this question, “What do we do that customers still want?”, because “that’s the focus of transformation A.” Instead, ask the following new question, “What unmet needs do customers have in today’s environment?” As they explain, Transformation B is about “the construction of a separate business with its own profit formula, dedicated staff, distinct processes, and singular culture.... The idea is to exploit the disruption without being encumbered by the legacy margins,revenue requirements, or practices of the core business.”

Here is where the capabilities exchange concept fits in. “Launching a successful start-up inside a threatened legacy business takes creativity and grit.... Scaling up the new business requires something more - a structure that allows the two organizations to live together and share their strengths.... That’s the role of the capabilities exchange, which coordinates the two transformation efforts so that each gets what it needs and is protected from interference by the other.” The key is to determine which capabilities the B organization can borrow from the core to gain a competitive advantage over independent start-ups.

Here is an example from the aforementioned article. Barnes & Noble sells books and reading devices. “As Amazon’s online sales cut into bookstore profits, the Kindle burst onto the scene in 2007. In three and a half years, e-books sales surpassed bound-book sales on Amazon.com.”

As a result, the authors pointed out that Barnes & Noble repositioned their core into “a chain of retail outlets that are designed to be enriching places to shop for gifts and spend time with children and that focus less on lower-margin high-volume book selling and more on higher-margin children’s books, coffee-table books, and gifts.”

At the same time, Barnes & Noble delivered a new business model: “The Nook e-reader business, which leapfrogged Amazon’s Kindle technology and used the chain’s brick-and-mortar stores to give customers physical access to the product in a way that Amazon couldn’t match.”

The shared resources for Transformation A and Transformation B were the following: “Branding, publisher relationships, customer intelligence, physical merchandising space.”

The results so far have been the following: “B&N’s $7 billion in 2012 revenues came mainly from its profitable chain of 700 retail bookstores. The Nook captured 27% of the e-reader market in two years, growing revenues from $ 105 million to $ 933 million. While the Nook division remains unprofitable, it recently received a $ 300 million equity investment from Mircosoft.” In short, Barnes & Noble is transforming itself from a book-seller to a technology company. 

The is a great article and I encourage all of you to read it. Here is the link: http://hbr.org/2012/12/two-routes-to-resilience/ar/1

Happy Reading!

Geery Howe, M.A. Consultant, Executive Coach, Trainer in Leadership, Strategic Planning and Organizational Change Morning Star Associates 319 - 643 - 2257