a white paper by Dan Coughlin
Different people have different infatuations. Bill Belichick, the head coach of the New England Patriots, loves to design strategic approaches to win football games. Oprah Winfrey and Larry King love to interview people and draw out insights that others simply can’t reach. Johnny Carson was infatuated with finding ways to entertain people.
My infatuation is with people who run business units. They are the ones responsible for guiding the efforts of other people to deliver specific business outcomes. I admire these people because the success or the failure of their group rides on their shoulders. These are the folks that will walk out of a seminar or close a book if they’re not getting practical value right away. Their focus is on constantly finding ways to improve critical business outcomes. The scope of their influence covers strategy, planning, execution, hiring and training and developing talented people, letting go of individuals who aren’t helping the group succeed, studying market trends and understanding customers and potential customers, creating true business teamwork, leveraging their own strengths and passions and those of the members of their group, and continually finding ways to improve all aspects of their business unit.
I’m not infatuated with running a business unit, but I am infatuated with working with people who do run business units to see if together we can find ways to generate better sustainable business results. In this field, I’m an equal opportunity admirer. I like working with people who run billion-dollar regions for huge multinational corporations as well as entrepreneurs who run $2 Million family-owned businesses. To me, it’s the same challenge: how that individual can increase the chances their organization will succeed in a sustainable and profitable manner.
Over the past eight years I’ve worked alongside more than 100 people who run business units in over 20 industries, provided over 1,200 Executive Coaching sessions, and spent more than 3,000 hours on-site observing executives and managers in their day-to-day working world. Here’s some of what I’ve learned so far.
There are two big picture concepts to keep in mind that will serve as the framework for all of the practical ideas on how to effectively run a business unit.
The first concept is called, The Three Dynamics of Achievement, which is represented in Figure 1.
It’s been my experience that all results in organizations occur because of three on-going and overlapping dynamics: technical dynamics, human dynamics, and business dynamics. Technical dynamics are the bits of knowledge that are unique to your function, your industry and/or your organization. Accountants in the automobile industry need to know certain things that are different than the certain things that commercial real estate agents need to know. Those differences lie in their respective technical dynamics. Human dynamics refer to your ability to effectively interact with other people, influence how they think, and build purposeful groups of individuals who support one another. Human dynamics are not specific to a particular organization or industry. Business dynamics refer to items such as strategy, planning, execution, talent management, innovation, and understanding why people do what they do. To run a successful business unit, you need to be aware of the importance of all three of these dynamics simultaneously. It’s not enough to be strong technically and have a great strategy if you can’t communicate with other people. Similarly, it’s not enough to be a great influencer if you don’t have a clear understanding of your industry or a clear plan on how your group will achieve the desired business outcomes.
Since I’m certain you know infinitely more about the technical dynamics of your work than I will ever know, this white paper will focus only on human dynamics and business dynamics.
The second concept that completes the framework for ways to run a great business unit is The Four Components of Business Acceleration, which is shown in Figure 2.
First, you need to be effective as an individual. It’s impossible to create a highly productive team if you show up late all the time and are unprepared. However, being productive as an individual is not sufficient for running a successful business unit. You need to create a group that has a clear purpose connected to the goals of the overall organization, and where the members of the group support one another toward fulfilling that purpose. No executive in even a medium-sized organization can serve customers completely by himself. All business results are always generated through the efforts of other people. Yet if the organization does not have a clear strategy for generating sustainable and profitable growth, a well-defined plan for executing within the strategy, and the capacity to continually innovate, then the individual business unit will fail along with the rest of the organization. And finally no business unit can succeed unless its efforts meet the needs and/or wants of a consumer base. I’m defining “consumers” as meaning the pool of people who would have a reason to buy your products or services. These could be “consumers” in other businesses, government, not-for-profit organizations, or members of the general public who are buying for their personal and family needs and wants.
The Role of the Individual
Start by optimizing your own effectiveness first.
Value is anything that increases the chances that another person will achieve what they want to achieve. The key to optimizing your own effectiveness is to find the greatest value you have to offer and put it into motion as often as possible.
Your Greatest Value
Your greatest value is the combination of your strengths and your passions. Figure 3 demonstrates the relationship between strengths and passions.
An Individual’s Value
In Quadrant I, the person is doing something he is not very good at and has no passion for doing. My question is, “Why?” Why is the company letting him work in that position, and why is he wasting his time doing it? That was me when I was an engineering student at Notre Dame. I had no passion for the topic and no skill in applying it. However, if you’re in that situation there is still a glimmer of hope. I learned one skill, how to think logically, that has helped me enormously in the work I do today. If you’re in Quadrant I, what is the one thing that you are gaining from that experience that you could apply in the work you really want to do?
In Quadrant II, the person is doing something he is passionate about, but he is not very good at it. That was me as a college soccer coach. When I was 24, I was one of the youngest NCAA Division I head soccer coaches in the country. I had huge passion for recruiting and building teamwork. However, my technical knowledge of college soccer was so poor that at 27 I became one of the youngest former NCAA Division I head soccer coaches in the country. Are you in a position now that you’re passionate about, but requires skills that you don’t have strengths in? You may very well end up working very hard and never achieving significant success.
In Quadrant III, the person is doing something he’s good at, but has no passion for doing. I was in this quadrant when I was a high school math teacher. I was good at explaining Algebra I and Algebra II/Trigonometry to my students in ways that they could understand it, but I had no passion for the topic. I didn’t care about Pythagorean’s Theorem or that two triangles are congruent if two sides and the included angle of one triangle or equal to two sides and the included angle of another triangle. Are you doing work that you’re good at, but have no passion for doing? If so, you will never find the reserves of energy necessary to achieve greatness.
In Quadrant IV, the person is doing what he is good at AND passionate about. This is the person’s greatest value. When you are operating in this quadrant, you have the opportunity to achieve extraordinary and sustainable results.
Consequently, the first step toward running a successful business unit is to take out a sheet of paper and write down your answers to these two questions, “What am I really good at? What am I really passionate about?” These are simple but serious and powerful questions. Spend some time on them, as in a few weeks. The better you understand your strengths and what really turns you on, the better your chances are of doing work where you contribute your greatest value.
Operate at the Intersection of Greatness
The next step is to operate at the intersection of greatness, which is shown in Figure 4, where you are applying your greatest strengths and passions in a way that is generating better results in your organization’s highest priority business outcomes and your customer’s highest priority business outcomes.
Once on a flight back to St. Louis from Austin, TX it dawned on me what the single most important factor is to achieving sustainable success. This is after 1,200 coaching sessions. It is simply this.
|The single most important key to achieving success is to intelligently apply your strengths and passions toward achieving your desired business outcomes.|
Let me break that down for you:
First, you need to know your strengths. In other words, of all the things you do, what do you do the best? This is not in comparison to other people. This is in comparison to the other things you do.
Second, what are you passionate about? What will keep you juiced throughout the day?
Third, what are the most important business outcomes you are trying to generate both for your organization and for your customers?
Fourth, “intelligently applying” means you need to step off of the train frequently, step back, and ask yourself, “Ok, which ones of my strengths and passions do I need to apply in this situation in order to accelerate the achievement of the desired business outcomes?”
That last one is the real art of making an impact. You determine which of your strengths and passions you are going to apply in the given situation, you apply the brush, you reflect on what has happened, you apply the brush again, and you keep trying to make a greater impact. The key, the absolute key, is that you approach the situation by applying YOUR strengths and passions, and not what has worked for someone else.
If you are a great listener and enjoy drawing out insightful ideas, then use that strength and passion. If you are a charismatic figure who can rally other people to do the unthinkable and enjoy seeing the group succeed, then use that strength and passion.
People fall into self-doubt when they continually try to figure out how to enter a situation. The answers are already within you. You need to be familiar with your strengths and passions. And then you need to step back when faced with a difficult situation and determine which of your strengths and which of your passions are going to make the greatest difference in this situation. As much as I admire Oprah Winfrey and Mike Wallace as great interviewers, I have to admit that they each achieved success in very different ways. The similarity between them is that each of them uses their strengths and passions when they conduct an interview. What works for one, won’t work nearly as well for the other. The same is true in running a business unit. You need to know your strengths and your passions, and you need to apply them intelligently in the situations you are faced with everyday.
The Fallacy of Work/Life Balance
It’s not difficult for a successful executive or manager to have a great balance between their home life and their work life.
That’s right, it’s not difficult. It’s impossible. I’ve never come across the manager who is a modern day Ward Cleaver and at home every day by 5 PM and never travels. The executives and managers I’ve interacted with are jumping on planes and checking e-mail and preparing for important meetings and doing research to make important decisions and dealing with important people issues and finding new customers and working to strengthen relationships with current customers. Without parameters, they could work the ludicrous schedule of 24/7.
In at least 85% of the Executive Coaching relationships I’ve been in, the other person expresses a greater desire for better work/life balance. In a nutshell, they want to be home more. However, their walk does not match their talk. Here are some tips on operating within reasonable time parameters:
- Focus on Priority Management over Time Management. None of us can manage time. We all get 24 hours a day seven days a week. However, each of us can select our highest priority outcomes. Once you know your two or three highest priority desired outcomes, then establish the three things you can do that would have the greatest positive impact on achieving each desired outcome. Then work to pour the highest percentage of your time into the fewest things that will have the greatest positive impact on achieving the desired business outcomes.
- Select the number of hours you want to work in a week. Since I regularly hear people say they work 65-70 hours a week, I’ll establish, for the sake of argument, that the desired goal is 50 hours a week of work. You can make it less or more. It’s your desired number, not mine.
- When the 50 hours are up, you’re done for that week. If you use them up by Thursday, you don’t get anymore. The first time that happens, I can assure you that you will reexamine how you’re hours are being used up each day. The only way to make this boundary work is to make it an actual boundary. You get 50 hours total. That’s it. No more.
- When people interrupt you with a request, say, “I’ll be glad to meet with you. However, I can’t meet right now. Here are three options on my schedule later in the week. What would work best for you? Also, please send me an e-mail with the specific question you want me to try to answer and anything I should bring to our discussion. That way I can be prepared to help you.” Work hard to move away from answering questions on the spot. When you meet with the person right away, you’re doing all the heavy lifting for him. By forcing him to wait and to phrase his question in an e-mail, he will many times solve his problem without meeting with you at all. That’s a good thing, not a bad thing. The goal is to get him to think for himself. You’re not being rude by saying that you can’t drop everything on the spot to help him.
- Schedule only 60% of your workday. Leave the rest of the time open to talk with people, to provide coaching for other people, to observe people in action, and so on. Your days will get filled up, but this way you won’t be adding stuff on top of an already packed schedule. Once you’ve scheduled 60% of your allotted time, don’t schedule anymore meetings or activities.
- Meet with your administrative assistant and put in place a few parameters on your schedule. One, never, ever double book a time period. Someone is going to be upset when you have to cancel on them or reschedule. That’s rude to do that. Also, no meetings scheduled back to back. Always build in 15 minutes between meetings. Be firm about ending meetings on time. Those 15 minutes are necessary to clear your mind, relax, and prepare for the next meeting. Finally, don’t be a “road victim.” If you’ve traveled three days in a row, then work the fourth day at home in order catch up and be better prepared to meet with your business group the next week. Be sure to run the business unit, and not let the business unit run you.
The Role of the Group
No executive is an island.
I’ve never worked with an executive or a manager who provided value to a customer all by himself. All business results are achieved through the efforts of other people. In running a business unit, this thought is critically important to keep top of mind. Even though we operate in a business environment where some CEOs are ridiculously overpaid, the truth is that business results are generated by groups working throughout the organization.
Harsh Reality of Teamwork
Teamwork happens when a group of people support one another toward achieving a meaningful purpose.
The harsh reality is that teamwork rarely happens in a business. All too often individuals talk about the performance of their department, the issues their department is facing, the resources their department needs, and the bonuses their department wants. The only problem is customers don’t care about departmental performance. They only care about the net result of all of the departments’ efforts. Since no one department completely serves the customer, departments are dependent upon one another to add value to the customer. Consequently, there’s a dangerous dichotomy in motion: individuals focus on the performance of their own department while it is only the work done between departments that matters to customers.
The people I’ve worked with and observed over the years do not come across as greedy, self-centered, money grubbing individuals. They seem like caring, kind, considerate, hard-working folks. So why don’t they create great teamwork more often?
The reason is they go home at the end of the day. When they get home and start interacting with their spouse, parents, friends and neighbors, the questions shift from, “How can we add more value to our customers?” to “How’s your year going?” Neighbors don’t want to hear about the level of teamwork in your organization or how departments support one another toward generating breakthrough ideas. They want to hear about the new deck you’re building or the vacation you’re going on or the new car you’re buying or what colleges you’re sending your kids to. The same holds true for your spouse, parents, and friends. They want to hear that YOU are doing a great job at work, and that YOU will be rewarded handsomely for it. While the focus at work is on how the organization can deliver better value and generate sustainable, profitable growth, the focus at home is on how you are performing and how you are being rewarded. Frequently this focus on your rewards takes over the focus on the team’s efforts, and teamwork breaks down.
Use the Ensemble Approach
In order to run an effective business unit, you need to sell all employees on the value of the Ensemble Approach. The Ensemble Approach says that the best ideas always come from the group. It states that no one knows who is going to have the insightful idea or which combination of ideas will ultimately be used. Just like the members of a great jazz band playing a piece of music, the members of a true business team are all willing to step up or step back depending on the flow of the conversation. When this happens, ideas can develop, gain momentum and buy-in from the group, and move toward effective implementation.
How can you create that environment?
The four keys to creating a successful Ensemble Approach are:
- Using open-ended questions.
- Drawing input from a wide variety of people.
- Steadily guiding the group toward a desired end state.
- Frequently recognizing and rewarding people for contributing and listening and collaborating.
Here’s an example. Imagine you run the women’s shoe division for a large shoe retail company with retail stores all across the United States. Your desired business outcome is to grow sales in a sustainable manner with women between the ages of 22 and 30 years old. Here are the steps you could use:
Form a Business Growth Council and include different types of people from different parts of the country and from different functions within the business. Have 20-25 people on the team. Bring in key suppliers as well.
Have each of them reach out to 10 women in that age category and ask them what they want from the shoes they buy. Also have each of them interview 10 men in the same age category and ask what they like in women’s shoes. Finally, have each of them interview 10 employers and ask what they look for when hiring people between the ages of 22 and 30. Now your team members are equipped with enough information to have a really meaningful conversation.
Send all members of the team this question to consider, “Based on your research and experience, what do you think are the three most important things we can do to grow sales with women between the ages of 22 and 30 years old?” Be sure to give them this question at least a week before you bring all of the members of the team together.
At the first actual meeting of the group, talk about the importance of the Ensemble Approach. Let them know that the best ideas always come from the group, and that it is critically important that every person put their ideas into the mix. Then give everyone the question from the previous paragraph and allow them three minutes to organize their thoughts and put them down on paper. Then randomly break the large group into small groups of five members each. Give the small teams 45 minutes to hear each of the ideas from the members of their group, discuss the ideas, combine ideas to make even better ideas, and then present the three best ideas they have as a small group.
After each small group presents their ideas to the large group, then you can facilitate a discussion toward narrowing those 12-15 ideas down to a few ideas. You may not reach a final resolution on the day of the first meeting. Consequently, you may need to send the team members a summary of the ideas via e-mail, and ask them to give you any additional input they have on the ideas over the next week. You can then take their input and still maintain the role of the final decision-maker on what will be implemented. In addition, send all team members a handwritten note thanking them for their ideas and level of collaboration. If you can afford it, send them a gift certificate to take their significant other out to dinner. Remember the importance of gaining support at home?
Planning: The Map to Achievement
Now that you have the key ideas in place, and the members of the group have begun to support one another in developing those ideas, you have begun to establish the early phases of teamwork. Unfortunately, that was the easy part. The hard part is mapping out what needs to be done by whom and by when in order to achieve the desired outcome of growing sales among women ages 22 to 30. Actually, the really hard part is executing the plan.
When you develop the plan of tactics, roles, responsibilities, timelines, and planned activities, here are a few thoughts to keep in mind:
- Tactics should fit within the strategic approach you’ve selected. If you’re going to focus on comfort and fitness with young women, then the tactics you’re going to implement from the perspective of marketing, branding, purchasing, and sales training, need to fit within that strategy. If your strategy is to focus on high fashion and a senior-level executive look, then your tactics need to adjust accordingly.
- Be reasonable. Every client I’ve worked with believes they can jump off tall buildings and stop locomotives while checking their Blackberry and meeting with prospects. Establish a set of activities that can be accomplished in a reasonable fashion. I know, I know, you’re thinking your company can do the unreasonable. I understand. However, I still want you to put together a reasonable set of planned activities and focus on executing them at an exceptionally high level.
- Look to rotate roles and responsibilities wherever it makes sense to do so. In that manner, you can develop people who can perform multiple roles.
Execution: The Grunt Work of Teamwork
In terms of execution, here are a set of steps I encourage you to consider for implementing your planned activities. Take each one and evaluate your performance in terms of strong performance, average performance, and weak performance. This will give you an idea of where you are hitting and missing the mark in terms of actually implementing the tactics and planned activities.
Steps to Effective Execution
- Sequence the planned activities.
- Be willing to sacrifice some planned activities.
- Schedule the remaining activities.
- Establish a critical path for each planned activity of who’s doing what when.
- Assign people to specific roles and responsibilities for each activity.
- Follow up with these individuals.
- Evaluate their performance.
- Give them guidance and feedback.
- Give top performers rewards and greater responsibilities.
- Work to improve the average performers.
- Remove poor performers, which are the folks who not only have poor results and poor behaviors, but whom are also unwilling to improve.
- Continually evaluate the efficiency and effectiveness of each planned activity.
- Be aware of opportunities and dangers.
By using these Execution Evaluation Steps, you can make adjustments and improve the overall delivery of your plan.
The Role of the Organization
Finding Your Strategy
Great strategies emerge from great awareness.
Strategy development processes are the poetry of business. Some people prefer Robert Frost, some Maya Angelou, and some Led Zeppelin. Every organization seems to have a different favorite way of developing a strategy. No matter what approach you use, the best strategies rise out of a strong awareness of your organization, your customers, market trends, and your competition. If you understand your strengths and passions as an organization, the true needs and wants of your customers, the important long-term trends in the market, and the capabilities of your competitors, you can identify an effective strategy for generating sustainable, profitable growth.
A strategy is a guideline for making decisions. It’s not something you do; it’s something that helps you to decide what to do. A strategy defines your business, or your part of the business, and the way in which you add value to your customers and prospects. Think of it this way. How much does a purse cost? Well, that depends doesn’t it? Are you buying it at Wal-Mart, Macy’s, Louis Vuitton, or from a neighbor who specializes in making funky purses? Each of those purse providers has a different strategy in mind, which results in different price points. The more you understand your organization’s strengths and passions, your desired customer’s needs and wants, the trends in the market, and your competition’s strengths, the better you are able to determine an approach to the marketplace that you can truly execute and that will generate your desired business outcomes.
As you increase awareness of the key factors mentioned above, start to map out different strategies your organization could use as the guide for making decisions. Try to project how each one will affect the marketplace in the most positive manner. Try to determine which one your organization will be able to deliver at the highest level with the greatest passion. By doing this type of preparation, you increase the chances of finding a strategy that will guide your organization to a better place in the market. You will be seen in a new light by customers and potential customers.
Why Innovation Matters
Of course, no strategy in and of itself is sufficient to generate long-term and sustainable profitable growth. Organizations improve or they go away. Drive-in theaters thought they had the market cornered on inexpensive ways for families to watch a movie until televisions made that concept even easier to execute. Tape recorders are giving way to iPods, and video recorders are losing steams to DVRs.
To run an effective business unit, you must constantly get your mind and the minds of every member of your group focused on how to create more value for your customers and prospects. The information age has given way to the creativity age because Google has commoditized information. You can get to any information you want in a few keystrokes. But when you get to the right spot on the internet, that information doesn’t tell you how to create more value for your customers. That only happens when you step off of the train of activity and onto the platform of thinking. Step back and ask your customers what is adding value to them, what is not adding value to them, and what would add more value to them. Go live in their shoes for awhile and see your products and services from their perspectives. See if there is a way to combine ideas from other industries into breakthrough ideas of your own. Isn’t iPod really just a combination of an old-fashioned library, an old-fashioned Sony Walkman, and an old-fashioned tape recorder. Combine those concepts with the power of iMusictunes and MP3 recordings, and voila, you have one of the most powerful devices created in the past decade.
Search for ways to improve and execute your best ideas in ways that generate sustainable, profitable growth for your organization. In a nutshell, that’s innovation. It’s creativity combined with a pragmatic focus. Get every one of your employees to focus on innovation. Don’t make it the sacred territory of a few people. Every employee should constantly be thinking about how to make the business unit more effective in adding value to customers. Every employee should be asking customers what could make the experience of buying from your organization better. Every employee should be talking to suppliers to find out their ideas on how to add more value to customers.
Innovation is simply the process of identifying, combining and implementing ways to add more value to customers that can generate greater sustainable and profitable growth. Rather than thinking of innovation as a complex set of highly technological maneuvers, think of it as a simple process of constantly finding ways to add more value to customers. In that manner, you can steadily look for improvements in every aspect of your business that affects the customer’s needs and wants.
The Role of the Consumer
Understand Why People Do What They Do
All effective products and services emerge from an understanding of why customers do what they do. As you analyze why certain products or services took off, you will gain an understanding of why people did what they did, and then you can extrapolate those customer needs and wants toward new or improved products and services that your customers and prospects may want or need.
Take iPod. Why do people buy an iPod? Seems to me it comes down to convenience, cost savings, and a “coolness factor.” You make a relatively small investment of $400 or less and now you have your entire collection of CD’s in your pocket. Talk about convenient. If you’re old like me, remember the stacks of record albums you had in your house. Now you can have all of those songs on one very small piece of equipment. Of course, you can carry around books on tape, seminars, teleseminars, and a host of other information all on that one little device. And don’t forget how cool the darn things look.
So now we know that convenience, cost savings in terms of the big picture, and coolness are three reasons why people buy products or services. In your industry, how can you provide breakthrough convenience, cost savings over the long-term, and/or unique “coolness”?
The role of the consumer in terms of achieving business acceleration is to provide you with important clues. As you uncover these clues, combine them in new ways, and apply them toward the value you add back into the marketplace, you can create breakthrough products and services. You can also enhance the experience that your customers have with old products and services and add more value in that way. Depending on your industry, your “consumers” could come from the general public, other businesses, not for profit organizations, or the government. A “consumer” is anyone who might consider buying the value you have to offer. This includes both your current customers, your prospects, and in all likelihood, people you’ve never considered.
Constantly step off the train of activity and ask yourself these questions:
- Why is a particular product or service suddenly jumping out and becoming unusually popular?
- What value are consumers getting from that particular product or service?
- How can my organization or business unit add that same value in a different manner?
- What products or services are suddenly falling by the wayside?
- What value did those products or services no longer add to consumers?
- Which of our products or services are no longer adding the value that consumers really want or need?
By answering these questions, you will have a much better sense of what ideas to pursue in the constant search to add more real value to your desired customers. In truth, great brands begin with an understanding of what constitutes real value to consumers. Once you have that idea in mind, then apply the concepts of strategy, planning, and execution.
In the famous words of Dr. Seuss in his classic book, Oh, The Places You’ll Go!, “Today is your day. You’re off to great places. You’re off and away.” Stay focused on the fundamentals of how to run a business unit. Keep in mind your role as an individual responsible for leveraging your strengths and passions to generate better results, the role of the group in planning and executing, the role of the organization in establishing a strategy and constantly innovating, and the role of the consumer and the insights they provide on why people do what they do. By focusing on the fundamentals and constantly finding ways to improve, you will build an extraordinary business unit.
Book Recommendations on How to Run a Business Unit
Role of the Individual
|Thomas Jefferson by R.B. Bernstein
The Education of a Coach by David Halberstam
Role of the Group
|1776 by David McCullough
The Five Dysfunctions of a Team by Patrick Lencioni
Role of the Organization
|Blue Ocean Strategy by W. Chan Kim and Renee Mauborgne
The 10 Faces of Innovation by Tom Kelley
Moneyball by Michael Lewis
Role of the Consumer
|The Ice Cream Maker by Subir Chowdhury|
About Dan Coughlin
Dan Coughlin teaches practical ideas on how to improve business performance. He is a business keynote speaker, management consultant, executive coach, and author of four books on leadership, sales, branding, and innovation. His books including The Management 500, and Find a Way to Win. His clients include GE Capital, McDonald’s, Coca-Cola, Marriott, Boeing, Abbott, Toyota, Subway, Kiewit, Prudential, Denny’s, and the St. Louis Cardinals.