Monday, December 8, 2008

Leadership vs Management

Leadership and management are abilities that are far too often confused and conflated in mainstream discourse. There are some similarities between the two, but they are in fact very distinct abilities that encompass a different set of skills and qualities. Good or great managers are present in many organizations while good or great leaders are much scarcer. The skills needed to be a great manager can be developed and honed while the skills necessary to be a great leader tend to be more innate and more difficult to learn (although not impossible).
Managers can manage any number of things. They can manage a task, subordinates, projects, transitions, meetings, or even expectations. Leaders lead people. That is the essence of the difference. A great leader must have the ability to inspire and compel followers (subordinates in the case of a company) to act and perform on behalf of something that may or may not serve their own self interest.
Followers of a great leader will execute their duties because they believe in what they are doing. They will carry it out to the best of their abilities because they are inspired by the vision laid out by the leader. Subordinates of managers will carry out their tasks because it is required a part of their occupation. They may or may not have any interest in the completion of the task and its broader significance to the good of the organization. As we all know, people will always do a more competent job when they are doing something they believe in.
Obviously, leadership and management are not mutually exclusive abilities. Great managers can be great leaders and vice versa. A great manager is always results oriented, plans exhaustively and delegates accordingly to maintain a stable and conflict free (to the extent it’s possible) work environment. A leader can do all of these things but might take a different route or use different methods to accomplish these tasks. Great leaders use there charisma to motivate followers to excel while managers draw upon the formal authority bestowed upon them to accomplish objectives.
In a business environment, having great leaders within the structure of your organization is more than just a bonus. Great leaders within the various levels of management in a large organization can serve as a competitive advantage in your industry. Every objective study that has been conducted on the issue finds that employees are more inspired, efficient and ultimately more productive when they are in regular contact with great leadership. On the other hand, uninspiring and lackluster management can cause productivity to wane. This data has compelled many companies to add leadership development programs to their training agenda.
Great leaders are usually charismatic and occasionally transformational. Embodying these characteristics comes naturally to a few but requires study and practice for most. One’s emotional intelligence must be trained and developed in a rigorous manner so the characteristics of leadership will become sincere and not transparently disingenuous. If effective managers can become great leaders, they increase their level of service to the organization and themselves exponentially.

Friday, December 5, 2008

Developing a Business Strategy

The essential questions that every business enterprise must ask itself are this; where do we want to go? How are we going to get there? These are simple questions that don’t necessarily have simple answers. The answers to these questions are vital in the development of a comprehensive business strategy. A company must have a direction and an overriding purpose. In order to establish a clear, sustainable and successful strategy, a company must conduct significant research on the industry in which it operates. It also must make an internal assessment of its own strengths and weaknesses. These two objectives can be achieved by conducting external as well as internal analyses. The external analysis looks at the industry’s environment and how favorable it is to the competing companies. The internal analysis assesses the inner-workings of the firm and the resources and capabilities that contribute to its core competencies.
A common method for assessing an industry’s external environment is to use Michael E Porter’s 5 Forces Model. Porter is a renowned professor at the Harvard Business School and author of many widely accepted strategic business tools. The 5 forces analysis allows for the evaluation of information related to an industry’s rivalry (or competitive intensity), threat of substitutes, threat of new entrants, power of buyers, and bargaining power of suppliers. It will help characterize the competitive environment in the industry and whether or not that environment is favorable or unfavorable to the companies within it. This step is critical in the strategy development process as it allows a company to identify the key success factors within its industry. Once key success factors are identified, a firm can begin to look internally to determine if they have those factors are present in their firm.
Porter’s Value Chain is an effective tool used to identify a firm’s internal activities. Bothe primary and secondary activities are evaluated and examined in an effort to identify the firm’s core competencies. Ideally, a company’s core competencies will correspond with the key success factors identified in the external analysis. If they do not, the firm needs to critically evaluate how it can meet those factors.
Once the analyses are complete, the firm has the information it needs to make a strategic decision about its products/services. Ultimately, there are really just two strategies that a company can pursue when it comes to a specific product or service. They can either try to be the price leader in their industry, or they can pursue a differentiation strategy.
A price leadership strategy might be a wise route when a key success factor is your ability to minimize cost (also known as cost leadership). If this is also a core competency of yours because of superior supply chain management, or maybe a technological edge that your competitors don’t have, than you have achieved what any and every business is after: a sustainable competitive advantage.
Product differentiation might be a better strategy to pursue in industries where customers are looking for something more specialized. In this scenario, the product must be different than the competition and provide value that the others don’t. If a company can deliver a product that is different than the competition and is in demand amongst potential buyers, then that sustainable competitive advantage is theirs.
Developing a comprehensive business strategy is necessary exercise for any company that hopes to succeed in a competitive industry. A company must identify goals, how those goals can be achieved and the specific processes that must be followed. External and internal analyses will lead the way and ultimately allow the company to determine if a sustainable competitive advantage is within its grasp.

Tuesday, December 2, 2008

The Importance of a Mission Statement

A mission statement is a company’s articulation to its customers, employees and the entire world of the purpose of its existence. Obviously, businesses exist to make money, maximize profits and shareholder value, but the mission statement is more about the front line than the bottom line. That said, in order for a business to be successful, it has to have a clear and broad mission that resonates with the public and tells them why it would be beneficial to do business with your company. The mission statement should represent the company’s vision of how it would like to be seen by its clients.
Mission statements generally include a statement of purpose, a business statement, and an indication of the company’s values. The statement of purpose explicitly states the purpose of the company. For example, a car company’s purpose is to manufacture cars. The business statement describes how they are going to manufacture those cars. The values portion of the statement talks about the common values shared throughout the company and how those common values contribute to the final product.
An ideal mission statement should be inspiring to employees. The statement brings a certain focus to the staff as the purpose of their work crystallizes and they are able to see the value of their contribution. Few things in life are as fulfilling as the knowledge that you are contributing something greater than yourself. The mission statement should allow each employee to see their own personal role in the firm’s success.
Customers will be reassured when they are exposed to the statement as they will be able to see that the company is committed to their purpose. Customers can also sometimes form a connection with the firm if the values outlined are ones they share. People like to work with others that they like and agree with, it’s a natural human instinct.
When you sit down to write your mission statement, there are several things you should keep in mind. First, who are my clients and what are their needs and desires? Second, how do I fulfill those needs and desires? What values does the firm currently have? What values do I want it to have? Are we all working together with a singular purpose or are individuals constantly veering of course?
A mission statement is best written in collaboration. The decision makers in the company should sit down and talk about their thoughts and how they want to represent the company to the public. Ideas should be bandied about, considered and then voted on. Once they thoroughly discuss, write and re-write the statement, they should make sure that it’s something that employees can buy into and customers can appreciate. It should be a statement that stays relevant no matter the difficulties the company may face and can serve as an instrument that rallies the troops to overcome adversity.

Saturday, November 29, 2008

Time Management for Managers

Efficient time management is critical for any manager. A manager that manages his/her time well will always have a leg up on the competition. The goal of time management is not to constrain or limit you but to maximize your productivity. A good manager is generally busy and must place a high emphasis on time allocation. The following are some guidelines managers should follow to manage their time more effectively:
1. Develop a time management plan. Remember that you run your business/department and you know what you have to accomplish. Sit down and analyze your average daily activities and how you could accomplish them more effectively.
2. Write things down. It’s a simple thing that we all can do to make our lives easier. Write critical activities down at night for the next day’s work. Cross off activities as you complete them and move down the list.
3. Set specific daily, weekly and monthly goals. Don’t set goals that you know will be a breeze nor should you set that will push you too far. Be ambitious but not obsessive.
4. Prioritize. Take time to identify your most critical tasks. The 80/20 method is a good guide to follow. Identify the 20% of tasks that are most important and focus on them by finishing them first or by setting aside a firm block at some point in the day to get them done.
5. Eliminate the waste. Identify the times in the day when you are not being productive or wasting time and do what you can to eliminate them. If you’re supposed to meet your boss and he tends to be late, make sure you schedule your routine tasks before that meeting so you’re not sitting idle.
6. Be flexible. As a manager who leads subordinate, you have to make time to address their needs and issues. Develop a routine, maybe set aside a specific time in the day where they can approach you about various issues. Give them directions for instances where they have a problem that needs urgent attention.
7. Delegate more. Too many managers take on too much work because they feel pressure from their superiors. More often than not, training a subordinate to perform a task will free you up to focus on more important things. When done correctly, subordinates appreciate the confidence you’re showing in them and will try to perform the task flawlessly.
8. Invest in and use time management tools. There are a number of software options that are great at keeping you on schedule.
9. Get comfortable with saying “no” to people. A good time manager needs to keep his priorities in mind and not give in to things that will throw him off track. People pleasing is not your primary objective. Besides, if you give them a brief explanation, they should understand.
There are far too many managers out there with sub-standard time management skills. Following these simple guidelines can help take your managing prowess to the next level.

Thursday, November 20, 2008

The problem with the Prop 8 debate

The debate on California Proposition 8 has been as heated in the aftermath of its defeat as it was in the lead up to the election. Consider me baffled. I’m not baffled because I have a particularly strong view on the issue or because I personally have a dog in this hunt. I am partially baffled that we continue to debate an issue this publicly and vehemently after the voters have spoken, but I’m especially baffled when I consider the substance of the debate.
I have debated people on issues before, both formally and informally. Sometimes, if the other debater is skilled at articulating their points, I start seeing their point of view with more clarity and have occasionally modified my view on an issue or changed it substantially. We all develop opinions about issues based on a set of facts, assumptions and our biases. We can change our opinions when we’re introduced to new facts or start seeing certain facts in a different light. This is when debate is worthwhile, illuminating, enriching and sometimes even exciting. Changing minds is a powerful thing.
A simple example of this might be universal healthcare. You can absorb one set of facts: we are the only industrialized nation without it, we are wealthy enough to do it, and there are 46 million people without adequate health insurance. However, implementing such a program would increase the size of government, increase bureaucracy, and take the industry out of the private sector (to some extent). People can look at these sets of fact and make their own decisions. What they can’t do is deny the facts. It is a fact that at least 46 million Americans don’t have healthcare as it is also true that an increase in bureaucracy is unavoidable. Indisputable facts can be taken, stored, considered and then used to reach an ultimate opinion. And since people on both sides don’t dispute these facts, they can be used as a launching pad to reach common ground.
On the other hand, debates can also be boring, predictable and utterly useless when the both sides of an issue are completely disinterested in the other’s facts, assumptions and yes, their biases. If and when someone rejects the facts that you are using, common ground is impossible to reach. You have no starting point without any common facts. Debaters end up meandering into a circular discourse that goes nowhere because people are not dealing with the same set of facts. Proposition 8 and the morality of homosexuality in general, is just that kind of debate.
Anytime religion or religious text is used as a basis for argument, or as a fact, you have nowhere to go but down. That in no way denigrates anyone’s religious beliefs, it just means that one’s faith is difficult to cite as evidence in a debate that should be judged on the merits of the argument. Supporters of Prop 8 believe that homosexuality in a sin that cannot be condoned. That is their fact. The argument against Prop 8 is that homosexuals are deserving of the same right to marry as heterosexuals. The underlying question to this debate has not changed: Do you believe homosexuals are born gay or do they choose to be gay? One’s answer to that question will usually dictate their stance on this issue. It’s that simple. The two sides of this issue don’t agree on the answer and the debate is fruitless until they do.
That said, there are a couple of points I’d like to make about this issue. First, in 2000 Prop 22 (preventing the state from recognizing same sex marriage) passed 61%-39%. We can clearly see the direction the electorate is trending. 2nd, it would be great if the movement against same-sex marriage could use the term “heterosexual marriage” instead of “traditional marriage.” Traditional marriage means different things to different people. To some it means that white men should only marry white women, and to others (the ancient Greeks) it means that 30 year old men should marry thirteen year old girls. Not to mention their “tradition” of homosexual rights of passage with teenage boys. “Tradition” is not a legitimate reason to maintain or discontinue any practice.

Wednesday, November 19, 2008

Change?

Before this past November 4th, I was one of those ardent Obama supporters volunteering some of my time to elect the man promising to bring change to America. I was not completely sold but I allowed myself to temporarily suspend disbelief and place those pesky reservations aside. Anybody who follows politics knows that the politicians in Washington are usually the changees and not the changers. That said, I believed Obama was sincere in his intentions and that if he could accomplish just some of what he had articulated, it would all be worth it.
The jubilation of election night has begun to fade and the Obama transition is in full-swing. 2 weeks in (still two months before inauguration and I'm already criticizing) and I'm a little apprehensive about the direction Obama is taking. Clinton folks have been running the transition (John Podesta), tapped for Chief of Staff (Rahm Emanuel), selected for Attorney General (Eric Holder) and have also been offered Secretary of State (Hillary Clinton). Don't get me wrong, I'm a Bill Clinton fan and wish he couldv'e ran for several more terms. But the question must be asked, is this really change?
Let's focus on Hillary. Is she the best selection for Secretary of State? The Obama campaign denegrated Hillary's foreign policy credentials during the primaries by correctly pointing out that she did not have access to national security intelligence. She made a fool of herself by creating a story about dodging sniper fire in Bosnia (in her defense, she did have to endure the reading of a poem from a young girl). To top it all off, Ms. Clinton made it a point to talk about the possibility of being compelled to "obliterate Iran." She was making things up and issuing provocative foreign policy proclomations like a liberated Dick Cheney. Is that the change you were talking about, President-elect?
That said, an administration's policy, tone and temperment starts at the top. Let's hope the incoming adminstration has a wide variety of viewpoints on both foreign and domestic issues and that President Obama is able to make decisions that truly affect change. That is, afterall, why he was elected. We'll be watching closely.

Tuesday, November 18, 2008

Charger Problems

If you have no interest in sports and the NFL, then I’d recommend you scroll down and skip today’s entry. My San Diego Chargers are uncharacteristically bad this season and I need to vent a little bit.
How could this football team possibly be this bad? They were 14-2 two years ago and got to the AFC championship game last year with mostly the same group they have right now. The answer can be summed up as follows: AJ Smith.
Smith was rightfully given credit for the juggernaut of a football team he built over his tenure with the Chargers. He has made some great draft picks (Shawne Merriman, Marcus Mcneil, Phillip Rivers) and locked up many solid contributors to long-term contracts (Jammer, Dielman). The good that Smith has done however should not overshadow the bad/stupid/illogical decisions he’s made.
I can’t blame AJ for the Merriman injury, and I’m willing to overlook the mistake of drafting Buster Davis (Anthony Gonzales was on the board, and he stays on the field for the Colts). But I can’t forgive the numerous other mistakes he’s made, none of which were individually catastrophic but collectively have chipped away at the greatness of this team. We Charger fans underestimated the impact of these decisions because we thought the strong nucleus of Tomlinson, Gates, and Rivers would be enough to overcome. I guess we were wrong. Here are some of AJ’s biggest mistakes:
1) The obvious one is the hiring of Norv Turner. I attribute the firing of Schottenheimer to AJ’s inflated ego and nothing else. To be fair, I am one of the fans that were screaming for Schottenheimer’s head after the loss to the Patriots in 2006. My rationale was simple: Over Schottenheimer’s last 3 years with the team, he had arguably the most talented team in football (definitely in the top 3 at the very least, go back and check the records and rosters if you don’t believe me). During those 3 years, the Chargers won exactly 0 playoff games. Completely inexcusable. He had to go.
That said, AJ was so full of himself that he gave no credit to Marty’s performance as a coach (a good regular season coach) and clearly believed that he had assembled a group of players that could perform under anybody. How else do you explain the hiring of Turner? I don’t blame Norv Turner. As Dennis Green might say, he is who we thought he was. It’s not a surprise when a coach with a crappy career record has crappy results. The mistake wasn’t firing Marty, it was in not finding a better replacement.
2) Big contracts and investments in Luis Castillo and Matt Wilhelm. Castillo is always hurt and when he is on the field, he's basically invisible. As for Wilhelm, is it really a good idea for the softest guy on your team to be a starting inside linebacker?
3) Pissing match with Donnie Edwards. You thought it was a bad idea to pay the man and give him a long term deal but giving one to Wilhelm wasn't? This one may not have been so bad if he had a competent replacement in grooming instead of Mary Wilhelm.
4) A slow and unathletic defense. Besides Cromartie and maybe Phillips (Merriman when healthy) is their a great athlete on this defense? Everybody knows that great athletes make great plays. Even defensive lineman can be great athletes for their relative size. But look at this group: Castillo, Olshansky, Wilhelm, Cooper, Tucker, Weddle, Hart. Is their a great athlete in this bunch? Smith didn't construct this defense with the necessary emphasis on speed and athleticism.
Those are the biggest, not the only mistakes AJ has made (Lo Neal isn't washed up afterall. Check out the Ravens rushing stats this year). Smith pays a lot lip service to things like responsibility and accountability. If he holds himself to the same standard than the Chargers might consider looking for a new general manager.