Leadership Caffeine—Breakaway Leadership Part 2

image of a foam coffee cup with brown outer sleeveThe Leadership Caffeine series is over 200 installments strong and is dedicated to every aspiring or experienced leader and manager seeking ideas, insights or just a jolt of energy to keep pushing forward. Thanks for being along for the journey!

In the first post in this blended, Leadership Caffeine/Art of Managing series, I focused on leadership and management behaviors that stifle or derail efforts to escape the gravitational pull of the past as organizations work to achieve what Geoffrey Moore calls, Escape Velocity.

In the words of that business pundit, Pogo, “We have met the enemy and he is us,” when it comes to building new on top of old (For those too young to have met Pogo, he was a popular newspaper cartoon character from another era.)

In this post, we look at behaviors and approaches that YOU and your management counterparts directly control that contribute to success with this challenging endeavor of building something new while managing the existing legacy business.

8 Ideas to Help Improve Your Odds of Success in Building the Future:

1. Create organizational awareness and understanding of the new endeavor. Every day. Seriously. I’m invoking Kotter’s dictate that, “in times of change, you cannot over-communicate.” Every time a firm’s senior leaders stop working at this, the cultural storm clouds emerge. Take care of it. Daily.

2. Position the new and legacy efforts as two equally critical but very different endeavors. It’s true. The existing business pays the bills and funds the future, while the new endeavor strives to ensure a future. One is no more critical than the other. They are both critical. Share the over-arching strategy (or opportunity) far and wide; create an understanding of how the firm will execute on the opportunity and share results, good and bad. Help the entire organization become invested in the success of the new endeavor!

3. Share the cool new toys! New endeavors often introduce new processes or approaches to innovation, development and market testing. Find opportunities to cross-train and cross-pollinate new approaches with legacy teams where appropriate. I’ve seen this most often in the move away from waterfall development to an agile approach. Frequently, all teams can benefit from understanding and learning to apply the new techniques.

Graphic with the words of Art of Managing and other management terms4. Recognize and manage the inertia of your legacy business in creating new opportunities to invest. Your product managers will naturally identify opportunities to improve existing products and introduce new offerings into legacy markets. Marketing associates will find ways to spend their budgets in pursuit of the business, and rarely do the volume of development asks or marketing opportunities shrink of their own accord.

Senior leaders must manage the incremental requests with a clear filter and a firm hand. See also points 1 & 2 and recognize that creating context for “No” on new requests is critical to avoiding a cultural rift over the team with the shiny new toys and the other team with yesterday’s retreads.

5. You get what you measure…use the right progress measures. Moore does a good job of reminding us in Escape Velocity that you cannot measure new ventures with the same metrics you apply to existing businesses. New ventures are about engaging innovators and early adopters, gaining feedback and step by step, increasing activities, pipelines and then dollars and profits. We expect our existing businesses to quickly translate activities into revenues and profits, but the new ventures have to grow into those measures.

In larger entities, particularly holding companies and conglomerates, there’s often little consideration for the meaning of the numbers in cells on a spreadsheet…it’s up to you and your peers to establish this understanding and ensure proper context for costs without revenue that occur in most new endeavors.

6. Be prepared for the “Stuff Happens” phase. I don’t care how well you define the project and anticipate risks, something always happens that the team did not anticipate. The unknown-unknowns bite hard, and it takes leadership to stand firm in the face of the onslaught of finger-pointing and second guessing, and prevail. A senior leadership divided against itself will not stand. (OK, sorry President Lincoln.) The firm’s senior leaders and the new venture’s executive sponsor must fight the knee-jerk reactions and guilty before proven innocent tendencies of others vying for resources.

7. We think, therefore we are prone to errors and traps. Be merciless about avoiding group-think, dodging escalation of commitment and side-stepping other group and individual cognitive decision-making traps. Use outside perspectives to challenge your strategy and your assumptions. Promote outside-in discussions with target audience feedback and competitor analysis. Ask others to frame your perceived opportunity in a different way and challenge them to identify alternative approaches. And importantly, cultivate the leadership team dynamics needed to ask hard questions about insights, direction and strategies.

8. Avoid starving the new endeavor. One of my favorite managers often intones, “We’ve been doing so much for so long with so little that we can now do absolutely anything with nothing.”  He always gets a laugh, but it’s no laughing matter when promising ideas die on the vine due to lack of care and feeding. If you’re making a courageous leap to push into a new arena, back it with the people, equipment, tools and organizational support needed to improve the odds of success.

The Bottom-Line for Now:

This is a big topic contained in a couple of small posts. Many organizations never move beyond the business that made them successful. They are yesterday’s name brands and tomorrow’s answers to trivia questions. The effort required to add something new in an environment of existing (or old) is not to be trifled at. Use the ideas here and in post #1 as prompters and engage in the hard discussions and invoke the courageous leadership it takes to move beyond the gravitational pull of your firm’s past.

Don’t miss the next Leadership Caffeine-Newsletter! Register herebook cover: shows title Leadership Caffeine-Ideas to Energize Your Professional Development by Art Petty. Includes image of a coffee cup.

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New to leading or responsible for first time leaders on your team? Subscribe to Art’s New Leader’s e-News.

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Strategy and Category—In Pursuit of Growth

Graphic with the words of Art of Managing and other management termsThe Art of Managing series is dedicated to exploring the critical issues we face in guiding our firms and teams to success in today’s volatile world.

I reference Geoffrey Moore’s 2011 book, Escape Velocity regularly in my management writing because it is in my opinion the most relevant and useful book on strategy in the past few years. (I hold Rumelt’s Good Strategy, Bad Strategy in high regard as well.)

Moore takes on THE major strategy issue faced by almost every successful organization with a bit of history behind it…dealing with the need to escape the gravitational pull of the past in search of new sources of growth.

It turns out, most of us aren’t much good at pulling this off…thus the tremendous volume of once good and now gone organizations. (One only has to look at the news to see the fortunes of category creators…the struggle of emerging firms and the painful struggle of once successful organizations to survive. For the latter, think Radio Shack, which did a remarkable job lampooning its irrelevance in a Super Bowl commercial last week.)

Chances are your organization has plans to “change” and as part of your strategy, you have the challenge to identify and capitalize on new sources of growth.  Those concepts make for pretty slides and create head-nodding executive and boardroom presentations. Actually doing the work is as I’m sure you know, far from simple.

Enter Moore.  He offers some priceless assistance in turning those inside-out strategy discussions and budget-driven investment plans into outside-in, investor and future focused discussions and actions.

Along the way, he proposes a Hierarchy of Powers (HOP), a framework of frameworks that articulates where firms can build or leverage “power.” The framework is quite simple and quite sophisticated all at the same time. The hierarchy is: category power, company power, market (customer segment) power, offer power and execution power. Category power is the focal point initially, and the subject of Chapter 2, which is frankly an MBA course in strategy all alone.

A Few Key Takeaways on Category Power:

1. Category power is the number one predictor of financial performance. Participating in growth categories harnesses secular growth that once gone is not easily replaced. The rest of us are left with cyclical growth (mature markets) or low or no growth created through consolidation and cost cutting (declining markets).

2. Helping our firms move successfully into growth categories is one of our core tasks as managers and executives, yet much of how we manage, plan, budget and commit gets in the way of moving from mature categories into newer and foreign growth categories. This gravitational pull is the enemy of finding new growth.

3. In support of the prior point, how we shepherd (measure, manage, structure, account for) growth categories is different than how we manage mature or declining businesses. It takes extraordinary effort and a different set of rules to enter and succeed in a growth category

4. Categories should be viewed and managed like a portfolio and most of our portfolios are out of balance, with too much emphasis in slow-growth, mature or worse yet, declining markets and no credible source of emerging or growth businesses. We’ve got to balance the portfolio or suffer the consequences.

5. Leveraging Category Power is the number one way to achieve Escape Velocity from the shackles of our past.

The Bottom-Line for Now:

The words around change and new and growth are always easy, but once we blend people, culture, and operating practices into the mix, everything about change becomes very, very difficult. This simple concept of shifting into newer and higher growth categories as legacy businesses sustain or decline is in fact profoundly difficult for most every firm and management team, yet this is a key task. The dominant logic that delivered success in the past no longer hunts in this foreign land. We need new ways, new people with new skills and agreement on the right measures for the right situation.

This task of helping your firm find and move into new categories defines the essence of your role as a senior manager. The task will draw upon all of your skills to promote vision, motivate change and foment learning. It’s hard, good and essential work. And there are no books with the answers, but Moore certainly helps us with the questions.

Big topic, small post. I’ll be back with more.

Additional Resources:

Geoffrey Moore speaking on Escape Velocity at Stanford (55 minutes well invested!)

My Leadership Caffeine podcast interview with Geoffrey.

Don’t miss the next Leadership Caffeine-Newsletter! Register herebook cover: shows title Leadership Caffeine-Ideas to Energize Your Professional Development by Art Petty. Includes image of a coffee cup.

For more ideas on professional development-one sound bite at a time, check out Art’s latest book: Leadership Caffeine-Ideas to Energize Your Professional Development

New to leading or responsible for first time leaders on your team? Subscribe to Art’s New Leader’s e-News.

An ideal book for anyone starting out in leadership: Practical Lessons in Leadership by Art Petty and Rich Petro.

Leadership Caffeine Podcast #10: Geoffrey Moore on Escape Velocity

Cover art for Leadership Caffeine PodcastOrganizations of all sizes and types, from high tech to manufacturing and not-for-profit, struggle with a common dilemma…how to escape the pull of the past as they look forward into a fast-changing and very different world.

If you’ve ever worked for or around a firm navigating the challenges of heading into new directions and leaving past ways and legacy products behind, you know how difficult this activity truly is for everyone involved. Many try and many fail.

Geoffrey A. Moore, the renowned high-tech strategist and author, perhaps best known for his book, Crossing the Chasm, a guide to helping firms move from early adopters across this fateful and often fatal canyon, is back with his latest book, Escape Velocity-Free Your Company’s Future from the Pull of the Past.  In the book, Moore tackles this tough topic of moving beyond successes of the past towards new generations of offerings and growth.

This was a great, fast-moving interview with Moore, and unlike Chasm which was focused on high tech firms, Escape Velocity is remarkably relevant for all firms, regardless of sector. I’m excited about the fresh, practical content from Geoffrey and I suspect you will be wanting more from Moore after listening. Enjoy!

Show Sound-Bites & Added Resources:

  • The challenges that arise when trying to free your company from the pull of the past.
  • Why our current budgeting, planning and operating systems fight us when it comes to escaping the pull of the past (and what to do about it).
  • A new framework of frameworks, The Hierarchy of Powers, and why this is so important for planning and orchestrating organizational change.
  • The questions you need to be asking and answering as you refresh and act on vision, strategy and execution.
  • Understanding the Inventory of Tools available to support your efforts to move beyond the pull of the past.
  • Great supplemental resource: Geoffrey Moore talking about Escape Velocity at Stanford (video)

About Geoffrey A. Moore:

Geoffrey Moore is a best-selling author and chairman emeritus of three consulting firms, The Chasm Group, Chasm Institute and TCG Advisors, all of which provide marketing strategy and organizational advice to leading high-technology companies. More information on Geoffrey, his books and services can be found at www.chasmgroup.com.

About the Leadership Caffeine Podcast:

The purpose of this show is to connect with leaders, management thinkers, authors, educators, entrepreneurs and anyone else passionate about improving and innovating in leadership and management. If you are interested in being a guest on the show, contact Art Petty.

Want More: Sign up for the new, Leadership Caffeine e-Newsletter. I’ll guard your e-mail address with ferocity, while sharing ideas to energize and inspire.

About Art Petty:

Art Petty is a Leadership & Career Coach helping motivated professionals of all levels achieve their potential. In addition to working with highly motivated professionals, Art frequently works with project teams in pursuit of high performance. Art’s second book, Leadership Caffeine-Ideas to Energize Your Professional Development, was released at the end of September in 2011.

Contact Art via e-mail to discuss a coaching, workshop or speaking engagement.