Management Excellence by Art Petty

You learn a great deal about an organization’s current state, near-term prospects and about the health and effectiveness of a firm’s leaders by looking for and listening to the quality of the conversations in the working environment.

Visit and spend time with the people inside an organization that is climbing, growing, reaching and striving for new heights, and you observe that the conversations take on a consistent, high-energy, action focused tone. You also observe and hear constructive and even passionate debate around topics that other organizations and individuals would lack the courage to raise.

Switch sites and visit a struggling organization and you get the impression that the more that people flail, the faster the organization will disappear into the economic quicksand. The conversations, if there are any are stilted, leadership edicts are dictatorial and the person-to-person dialogue is fueled by fear and buffeted by rumor.

I see this constantly in my practice and I’ve observed it consistently over decades of private industry experience. The best firms and the best leaders hone in the right topics and teach their teams and organizations how to talk openly and comfortably about those topics. Easy words, but no small feat when you take into account the common barriers to open dialogue of politics, siloization and the seemingly endless supply of people that have no business being in leadership roles.

The Seven Critical Conversations:

There are at least Seven Critical Conversations that I observe taking place over and over again in organizations that that are either successful or improving. These same conversations are often nowhere to be found except perhaps behind the closed doors of a firm’s leaders in less successful firms or organizations that are struggling and sinking.

1.  Vision. Great firms make this often lofty and meaningless agglomeration of words under glass come alive and permeate the culture of a firm. The “V” word instead of being consultant or MBA-speak is the source of energy for humans. It defines a goal, a championship; a destination that once arrived at will be a great accomplishment. Great visions…those that resonate are visions that inspire and challenge and motivate and help individuals and teams rationalize putting their hearts and souls into an enterprise.

2.  Strategy as an “All Hands on Deck” Action Statement!

While Vision creates context for the goal, strategy defines how we are going to get there. The books written on this topic fill entire shelves and many are brilliant in describing the tools and techniques, but most in my opinion miss the point.

Great, growing and successful firms leverage the tools of strategy to promote the right conversations across and up and down the organization. I’ve observed that the most vibrant of firms find ways to get everyone involved in strategy. At a bare minimum, the firm’s leaders ensure that everyone can connect their goals to the core strategies—the Walk In the Door test.

However, the real gold in creating the organization-wide strategy dialogue is in capturing the ideas that flow from so many parts of the organization that see ways to improve the customer experience and add important context to ideas and certainly how to translate ideas into actions and then provide feedback on the results and ideas for improvement. It’s a beautiful cycle of ideas execution, learning and adaptation.

3.  What Are the Leading Indicators?

The gross majority of firms measure and report on history, with little ability to look forward. The best firms get people involved inconstantly seeking to identify, hone and build processes around early and leading indicators.

A simple example is sales pipeline, yet that measure is often so isolated, convoluted and unreliable as to be nearly meaningless. Alternatively, firms that connect their lead system to their sales pipeline (much like a lead to sales refinery) and work hard to develop an increasingly reliable set of metrics that quantify changes and outputs, are a bit closer to having a reliable leading indicator. This is just one of many leading indicators that can be developed across functions that will tell you a lot sooner how things are going versus waiting for the quarterly financials, which are truly interesting but irrelevant for the future.

4.  What is the Customer Really Saying?

Good firms ensure that customer-facing associates have systems to collect and communicate feedback. Great firms ensure that there are people immersed in their customer’s environments, listening and observing and looking for the real problems.

A customer may complain about a particular product or request a certain feature, because their context for you is your product and your features. However, the right observation might uncover that your product and the feature is relatively insignificant compared to other unresolved problems that new products or services from your firm might well address.

5.  How Am I Doing?

Like a championship sports team where the athletes and coaches are constantly critiqued and critiquing, feedback must flow quickly, honestly and with expectations of accountability.

None of us are great judges of our own performance although we have a gut feeling as to whether we are in the ball game or not. Great cultures create an open feedback culture that requires the tough discussions to take place up and down and across the organization.

Easy words, but when was the last time you gave your boss or your peer in another department robust feedback? And then saw them do something with it?

6.  What’s Next for Me?

All of the above conversations are critical to creating a healthy work environment, but at the end of the day, we make very personal decisions on where and why we work and how hard we work.

The most successful leaders and teams ensure that there is a constant dialogue flowing about next career steps and that this dialogue is backed by actions.

Charan’s “Apprenticeship” model is a perfect metaphor for a vibrant development approach, except that Charan focuses it on finding the next CEO and I want to use it to test, assess and support the development of the people on my team or in my department. As a leader, there is nothing nobler, more appropriate or more valuable that you can do for a person than help them grow and develop. Some people resist that support, but most will be thankful to you for a lifetime.

7.  What did we do that made a difference?

This last conversation is a bit controversial even in my mind, but it strikes me as important to build a strong culture on layers and layers of achievements that give credence to what we can accomplish.

Firms that don’t talk about past successes and individual and team heroics feel to me like soul-less, heartless structures, whereas environments where the stories and heroes of the past are celebrated and used as models for the future seem so much more alive. This topic invites “Mission” into the discussion and shows how the collective and individual efforts lived up to “the reason for being” of the firm. I don’t want to dwell on the past, but our history is a powerful teacher and guiding force for our future.

The Bottom-Line for Now:

Long post and to me a fairly meaty topic. I would love your input, including your suggestions on whether I am on the mark or off the mark (in your opinion) on my set of “7” for the critical conversations. Passionate discourse encouraged!