START OPERATING IN THE REAL WORLD
Excerpts from “WINNERS ARE NOT LONELY AT THE TOP”
THE PHILLIPS GROUP
THE TRUE JOB DESCRIPTION OF THE CEO: START OPERATING IN THE REAL WORLD ESSAY 1
THE TRUE JOB DESCRIPTION OF THE CEO
THE TRUE JOB DESCRIPTION OF THE CEO is a series of five white papers highlighting the “Five Star Process”. The five star process is a process which helps a CEO drive a team to peak performance. These white papers correspond and mirror the main chapters of the book “Winners Are Not Lonely At The Top” by Carl Phillips.
The book describes and highlights the use of the “Five Star Process” by Garland Group who as a result of the process, delivered a triple digit lift on EBIDTA, and Cash Flow. In addition, the company increased organic sales by 52%. The results are discussed in more detail with specific numbers further in this paper.
This is the first of five essays entitled “Start Operating In the Real World”. The Five Essays are listed below and each one represents one of the five stars in the Five Star Process to which peak performing CEOs must adhere, and to which provide the framework for The True Job Description of the CEO.
This is essay number one: “Start Operating In The Real World”.
Star 1 – Start Operating In The Real World
Star 2 – Articulating The Common Vision
Star 3 – Assembling Mutually Supportive Teams
Star 4 – Creating A Disciplined Culture
Star 5 – Seek and Seed Leaders
We hope you enjoy the essay and be sure to read all five essays, and if you are a Board Member or CEO looking to drive your team to peak performance please reach out to us on CEO@tpgleadership.com
START OPERATING IN THE REAL WORLD
9 out of 10 businesses fail to achieve their goals because they fail to effectively implement their strategy. What is at the root of this failure? The chief reason for the failure is the CEO of the organization. That sounds somewhat dramatic, but true. We all know the common saying that children do not do what you tell them to do, they do what they see you doing. The majority of the people in an organization do what the CEO does, and by extension they do what their immediate superior does; not what he/she tells them to do.
In my previous role as the Global Head of Organization Effectiveness for Watson Wyatt World Wide, which is now a part of Willis Towers Watson Management Consultants – one of the largest international Management Consulting Companies in the field – I co-authored a book called “Global Literacies.” This book is an account of our interviews with 75 Global CEOs in 28 countries. Our mission was to discover what made these global companies succeed in a global setting. The overwhelming answer to this question was people. What motivates people to perform at their full potential? Leaders! If leaders are the key to making things happen, then we need to examine how they impact the implementation of a company’s business plan.
I have consulted with CEOs of medium and large international organizations for over 35 years in a global setting. Let me give you an example of such a CEO who adopted the principles of the concept of which I speak.
Jacques Seguin, the CEO of Garland Company based in Mississauga Ontario, Canada, is a recognized Business Leader. He is also the co-author of our book “Winners Are Not Lonely At The Top.”
The Garland Company at the time when we wrote the book was a 150 million dollar manufacturing company. In Jacques’ own words when he took over as CEO, “I tried to do all the key jobs of the organization by micromanaging and constantly checking and rechecking the status of things. I had a finger on the pulse of all the issues and dictated most of the critical decisions. I was the traditional genius with a thousand helpers. I was working seven days a week and still felt that I was behind–people were working hard but basically doing what they were told to do.
The employee satisfaction survey was not good. The majority of the people did not have confidence in the management team or in their direct supervisors. The management team was not really a team. They were polite and friendly with each other, but they worked in their own silos. We all knew that we were not geared up sufficiently to deal with the global competition.” Jacques realized that the company had to change their behaviour. They needed to follow an implementation process that would make the organization a strong global competitor. Garland undertook a rigorous program of change to improve their process of implementation and this is the result that they achieved four years later:
EBITA improvement of 175%, cash flow improvement of 254%, employee satisfaction of 85%, reduction in absenteeism of 16%, improvement in safety of 54%, organic sales growth of 52%, and the organization outperformed its industry average by three times.
What made this company achieve this unprecedented level of performance?
It was a program of implementation comprising five distinct phases that were rigorously applied. In my book I refer to these as the five stars. Let us examine these stars one at a time.
Star One = REALITY
Jacques had to face the reality that the process of effective implementation started with him! In Jacques’ own words, “Carl and I had several conversations and it seemed to me that he was zeroing in on me as the first main issue to be addressed. Needless to say, this was somewhat threatening and demanding. While I knew that I would be required to adjust my behaviour, I did not know that I was the starting point!
Once I adopted the new behaviour through the process, it was amazing how rewarding it was for me personally.” Jacques wholeheartedly embraced the change in his own personal behaviour in order to bring about change in the behaviour of the organization as a whole.
There are very few CEOs who realize the impact their values and behaviours have on an organization. Most CEOs mistakenly believe that their job is done once they clearly articulate a strategy for the organization. That is why it is important for the CEO to be prepared to personally lead the charge for change and thus be the role model for the rest of the organization.
The reality is that the leader’s values and behaviours have an immense impact on the organization and when an organization does not perform as it should, CEOs should review their own behaviours first while analysing the lack of performance of the organization.
In many cases where I have consulted in an organization, my mandate has always been to help the CEO correct the behaviour of the organization. When I turn around and suggest to the CEO that he/she needs to examine their own behaviour first, they often feel threatened and are turned off from commissioning the consulting project at all.
Jacques was mature and self-confident enough to realize that he had to lead the change and he had to be the change that he sought in the organization, despite the fact that he felt threatened by the idea. This is often borne out by the fact that most CEOs are replaced when another entity takes over a company that is not up to par.
The moral of the story, as you may have guessed, is that CEOs need to be the model of the behaviour that they expect from their organization. That is a reality that is hard to ignore, but not readily accepted. The behaviour of everyone in the organization seriously affects the implementation of the company goals.
There are many realities in business that are not honestly addressed which becomes the root cause of poor implementation. For example, in order for a business to achieve its full potential, the leaders of the organization should be capable and committed to achieve the organization’s goals. The CEO must objectively examine this reality as it relates to the senior executive team. The CEO must personally lead this exercise by honestly answering the following questionnaire objectively:
QUESTIONNAIRE
- Take a moment to reflect on the question “Who am I?”
Define yourself as a person as you see yourself and as you believe others see you.
- Answer the question “What am I?”
- Describe three key abilities.
- Describe three areas of deep interest that you enjoy.
- Describe three areas of development that you feel you need.
- Describe three critical incidents in your life that are difficult to forget.
- Why was each incident critical for you?
- What positive growth did each incident trigger in you?
- What are your personal goals in the:
- Long term? (Five years)
- Mid term? (Three years)
- Short term? (One year)
- What are your business goals in the:
- Long term (Five years)
- Mid term(Three years)
- Short term (One year)
- Are your personal goals in sync with your business goals? If they are not in sync, how do you plan to integrate the two?
- How will you know when you have achieved each of the above goals?
- What type of support would you like to get to achieve these goals from the following:
- Your boss
- Your colleagues
- Your direct reports
- Your customers (internal and external)
- Your suppliers
- Your coach or mentor
- What are the three most critical aspects of your current operating style that you know that you have to change in order for you to achieve these goals?
- Do you seek feedback from the people mentioned in question #8? If so, how does their feedback differ from your perception of yourself?
- It has been seen that people who believe in the vision of a company perform at least 30% more effectively than those who are less committed to the vision. How will you clearly articulate the common vision of your company? We define the common vision as the vision that every member of the organization accepts whole heartedly as their own.
- A team is defined as a group of people who:
- Have common goals
- Have a common approach to achieve these goals
- Have a common measure of success for these goals.
- Have a common understanding of the reward system for the achievement of these goals
- Each member is mutually supportive and accountable for the achievement of the team’s goals.
- Are your direct reports a team?
- Do you believe that the purpose of leadership is to create more leaders? If you do, how do you plan to inculcate this concept in your organization when:
- Recruiting new hires
- Mentoring and coaching
- Supervising and managing
- Career planning and succession planning
- Promoting
- Innovating
- Rewarding
- What are the top three values that you would like your organization to promote?
- There is a saying that “You cannot be promoted if you cannot be replaced”. How would you ensure that this concept is implemented in your organization?
- How do you realistically evaluate whether you have a winning team? There are two key perspectives that will often decide the team’s effective output: their Capability and Commitment to make things happen in the organization. There are four permutations and combinations of this essential prerequisite:
Type of person Action required:
1. Capable and Committed Promote as role models
2. Capable but not committed Get further buy-in to vision.
3. Committed but not capable Consider for a different position
4. Not capable and not committed Move them out of the company
Informally evaluate your direct reports and place them in the category that you think they belong; and you will get a fair idea how prepared your team is to reach the company goals.
Once the CEO has taken this questionnaire, he/she should have an independent professional discuss the CEO’s answers to help the CEO objectively assess the reality of his/her leadership skills vis-a-vie the current business needs of the organization.
This same process should then be followed with the direct reports of the CEO. With the direct reports, the exercise is conducted by the CEO personally. From here on the direct reports repeat the process with their direct reports and thus the process is cascaded down to the bottom of the organization. With each leader taking time and responsibility to lead the process with their respective teams.
Through this process the CEO and the direct reports would have established a realistic picture of the leadership challenges that will have to be addressed for the organization to meet its goals. The above process is the most important first step that needs to be addressed from a reality standpoint.
This rigorous process must then be appropriately followed to establish the real status of the company as it relates to the business environment, the competition, the products and services and a realistic plan should evolve through this process that is achievable.
Optimism is a good ingredient to have for a business plan, but the optimism should not be at the cost of ignoring reality. Unfortunately, this happens very often in business. Sticking to the idea that the ship will be okay when there are clear signs that it is sinking is not uncommon in business. Most often this is done in order to ensure that no one rocks the boat.
The first step to facing reality is to objectively evaluate the leadership team and help each of them understand that they have to lead the way in the new behaviour that the company will have to follow to succeed. This is the first step to changing the company’s behaviour.
This is only the beginning of a rigorous process because people do not change right after they agree to change. The most common mistake that leaders make is that they assume that once they have told the company with great fanfare, by giving inspiring comprehensive speeches, buttressed by expensive artistic handouts outlining the change, that the company will now adopt the new behaviour. This is not true. In order to embed new behaviour in an organization, there are four distinct steps that need to be taken to ensure the implementation of the change in behaviour:
- Clearly defining the change and ensuring the change is understood by each team member. That is helping every individual connect the dots, addressing individual differences in the interpretation of the change.
- Ascertaining that every individual in the organization accepts and is committed to making the changes required.
- Having a motivational platform to launch and implement the change.
- Having a disciplined approach to review the change achieved and to redirect and reinforce the elements of the changes that are not being achieved.
Because this process takes time, there has to be consistency and constant follow up. Steps 1 and 2 above vary with different individuals based on individual perceptions, interpretations and readiness to change. The CEO should devote a considerable amount of time to reinforcing the implications of the change and the consequences to the company and the individual if the change stalls for some reason. The CEO needs to simplify the process so that the lowest ranked person in the organization is able to connect the dots. Unfortunately, a majority of companies take the attitude that people should change based on the business plan or move on.
In one international organization that I helped implement a change, the Regional Manager of a large region refused to recognize the change despite the fact that the CEO patiently reiterated the need to change as simply and consistently as he could. Unfortunately, six months later, the Regional Manager was let go. Following this action, the region adopted the change and they were back on track. Sometimes the price of change may be that the CEO has to make a correction in the type of leadership that is needed to effectively implement the goals of the company.
One of the most common reasons for failure to implement change is the fact that a programme of change is created in all good faith but there is no serious follow up and there are no tangible consequences for not doing the follow up.
People also need a process for change that answers the question “what’s in it for the organization and for me”? Accordingly, there is a need for further necessary phases, or what we call the other stars in the Five Star Process, to incorporate these aspects. I say there is a need for a disciplined process that is rigorously followed by the leader herself or himself as a role model to start with, and for the rest of the leaders to effectively follow in her or his footsteps to launch the successful implementation of the company’s goals.
In order for this to happen seamlessly, the company should follow the Five Star Process and follow the other stars described below:
Star 2 – Articulating The Common Vision
Star 3 – Assembling Mutually Supportive Teams
Star 4 – Creating A Disciplined Culture
In the words of Paul Daoust, Former Chief Operating Officer of Watson Wyatt Worldwide who actually implemented this process with great success, “Real change is extremely hard and it will take leadership from you, and many others to achieve meaningful results. Once you go down the road of the Five Star Process, whatever you do, don’t blink.”
In closing, I would like to say I hope you find the tools in our essay series effective in driving peak performance in your team as so many of our clients have. As you unlock the potential of your organisation you will redefine the heights of your success.
ABOUT THE AUTHOR
CARL A. PHILLIPS
Chairman, The Phillips Group
Location: Toronto, Canada
Carl has been consulting to CEOs and Leaders for over forty years. He is an Industrial Psychologist, an Entrepreneur, and an Author who has written two books on leadership. Carl was the Head of Global Organization Effectiveness for Watson Wyatt Worldwide, which is now called Willis Towers Watson, one of the largest management consulting companies in the world with over 14,000 employees.
Carl Phillips is a Certified Management Consultant who has created several assessment instruments and tests on leadership which he has been applying effectively on a variety of global companies located in North America, Europe and Asia for over forty years. Carl’s book, “Winners Are Not Lonely At The Top”, is a live case study of the proven application of his “Five Stars” model for experiencing exponential, sustained growth in an organization.
Carl has co-authored a book called “Global Literacies”, published by Simon and Schuster, New York. The book is a summary of his interviews with seventy-five global CEOs located in twenty eight countries wherein the lessons learned by these CEOs on the challenges for running a successful global company are documented in detail.
Carl Phillips has been keynote speaker in several international conferences on leadership and he has written a number of articles on The True Job Description of the CEO, a unique insight into the critical force in an organization that is often neglected.
SHANE PHILLIPS is Carl’s son and is currently the CEO of The Phillips Group based in Dubai, UAE.
The Phillips Group has been helping companies align, focus and build their leadership teams since 1984. Driving organisations and individuals to peak performance has been our raison d’etre for two generations.
Please contact us for your CEO Assessment Guide at CEO@tpgleadership.com
The PHILLIPS GROUP
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