I had a facinating discussion yesterday with a business friend on my observation that “Business teams are working hard at staying still”.

Teams standing still to survive
I suggested to him that, in the current economic climate, a majority of business teams had stopped evolving and developing new ideas. It seems that many businesses are afraid of the future and of spending money that may be needed for some unsepecified reason. The result is that teams have stopped evolving new ideas, improvements in process and new projects. They are standing still in the hope of surviving.

The problem is that doing nothing is NOT a survival strategy. Let me give the example that I gave my friend. The fewest number of business bankruptcies within the EU seems to be in Greece, Portugal and Spain. Countries where innovation and development and new business is at an all time low. The reason is that few businesses are being opened, fewer initiatives being created and a stagnation in entrepreneurial activity.

In Sweden and Norway, on the other hand, business failure is as high as ever…but then the number of businesses being opened and business success is also high. The proportion of success, however, vastly outsrips the failures. In the Uk the business teams that I’m working with have an energy that is developing new ideas, bringing in greater results and profits.

Formula for acceleration
It strikes me that the formula for mass and acceleration is applicable here: That being F=mA (F=Mass X acceleartion called a newton).
Replace F(Mass) For T (Team) and multiply it with ideas, innovation and experimentation and you can only end up with acceleration

I’ve been advising business on avoiding “New hire failure” for over twelve years. Too often, however, I’m asked to advise on a business after they’ve experienced an expensive and very time consuming new hire disaster.

Causes
Despite a great CV (Resume), powerful past experience, great qualifications (MBA) the biggest cause for new hire failure is an inability of the individual to make the transition from one job to another (promotion or business change).

The reasons given by team members and colleagues for a leadership failure always include some of the following:

• Inability to solve specific business problems
• Troubled relationships with the team
• Intimidating or bullying management style 
• Failure to develop team or subordinates
• Unable to deal with conflict
• Failure to adapt to new boss’ managment style
• Failure to build team (recruitment isues)
• Overuse of one mentor or advisor
• Inability to think strategically

The question is why?

After a robust interview process how is it that so many senior new hires fail due to the above list?
Here are some, but by no means all, of the reasons I find so often:

• Friend being appointed (always a problem)
• He did a great job for his previous company (But are the circumstances the same?)
• Sloppy hiring process (Failure to follow up on information)
• No integration process (or ignored due to seniority of hire)

It seems that “losing top talent to competitors” is keeping some senior Directors awake at night. In the past few days I’ve been approached by three different companies asking for help to reduce the risk that their top talent might leave the team.

Here are just three of the tips I advise my clients when advising on retaining talent.

1) Ask yourself the reasons why the talent joined your team in the first place. (Was it challenge of the work, learning opportunities, career path, the business looked great on their CV, resume?). Are these reasons still relevant and are they still being delivered?
If not then the talent is at risk of leaving.

2) Ask yourself the value of your “Poach Rate”. The “Poach Rate” is the additional percentage in salary that a competitor would need to offer to steal your talent. The higher the percentage increase in salary the more your talent values working for your team. If the competitor only has to offer an additional 2-5% salary increase then the reason for leaving is more likely to be poor management, poor culture, few learning opportunities etc.

3) Meet and observe your top talent. Not just at appraisal times but regularly.
Listen and look at the way they walk, talk, dress, engage with customers and colleagues at meetings. (I often go into a business and find that I can identify a talent that’s “on the way out” by just looking at how engaged they are. But then I do this as a matter of norm and often I’m not wrong!)
Ignoring talent because you believe it’s happy, or you’re too busy to observe it, tends to increase the risk that it will leave.

Finally it’s worth considering that the day a talented member of your team tells you they are leaving your team is probably six months after they made the decision to do so!

CNN reported that HSBC has announced that 3,000 people – roughly 10% of its
workforce – will be out of a job by 2013 and are part of the bank’s plans to eliminate 30,000 positions worldwide.

Other banks making huge numbers redundant include Bank of
America, the largest bank in the U.S., plans to shed between 25,000 and 30,000 jobs as reported in the Charlotte Observer . In Stockholm, Nordea, the largest bank in the Nordic region is to cut 2,000 workers. The Dutch bank ABN Amro has announced that it will cut 2,350 jobs. The Daily Telegraph has reported that Lloyds TSB will be cutting 15,000 jobs, Barclays 3000 and Goldman Sachs 1000.

A payroll cut is instant money
Banks are looking for ways to boost their
bottom lines – and as employees
represent around 60% of a bank’s expenses a payroll cut is instant
money.

Another reason is that as banks increase salaries and reduce bonuses they find that whilst bonuses could be easily adjusted to reflect the bank’s financial performance, salaries are a fixed cost. So rather than axe bonuses, banks are axing bankers.

A future problem
In my experience when team personnel are restructured there is the need to restructure work processes and determine new targets and work outcomes. In effect there is a NEW TEAM and new teams are likely to achieve their anticipated results only 60% of the time.

This failure rate (40%) can cause huge losses on the bottom line and delay mission critical outcomes unless clear management of the transition situation is carefully implemented. In my experience the more team change that’s implemented at the same time the more likely there is to be a failure. 

Yesterday I blogged on Simon Swan’s article in the latest edition of Management Today and got quite a reaction. A whole load of people, shocked at the costs to their business, contacted me with questions and to discuss team restructures. They ranged from large businesses with a number of teams to a small company of four considering expanding to a team of just five people.

Not so boring stats
All of them were shocked to hear the answers to the “INfrequently asked questions”.
that business never asks*:

• What percentage of new hires fail within two years of appointment?
  A: 40%
• What % or restructured teams fail to meet objectives?
  A: 42%
• What % of projects are completed to time, budget and specification?
  A: 28%

But it doesn’t have to be like this and I talked through my callers an eighteen minute SKYPE call when I explained how to reduce the risks of new hire and team failure…easily.
They’ve urged me to offer the same eighteen minutes to my SKYPE contacts (stephenharvarddavis) and I thought I would offer this to my blog readers and at no charge.

If you want to take me up on this then email me at Stephen@assimilating-talent.com so that we can arrange a mutually convenient time for a SKYPE call.
For the moment I’m restricting this to the first ten respondents and during the next seven days so don’t let time pass if you want to take me up on the offer

* Stats from various sources including Fortune Magazine and HBR

Ten days ago I was talking to Carl, a good friend of mine, who’s “Ticked off” with the co-operation he’s getting from superiors and colleagues. Now those very people may have to work that bit harder! 

A trail-blazing project
Carl, together with his management team and staff of two hundred, have spent the past year leading a trailblazing project that saves huge amounts of money and delivers enhanced service to the local community. People have said to him “What would we do without you?” and “What you’ve achieved is brilliant”. To achieve these plaudits he’s had to work long hours, hiring a large team and creating process, systems and culture and often without a “model” to follow.

As is usual there has been criticism from other areas of the business that feels overshadowed and exposed. As a result Carl’s team have felt pressured and unappreciated by the very people they are helping to do a better job.

A well earned holiday
A few weeks ago he went on holiday with various senior people and colleagues promising to deliver work whilst he was away ringing in his ears
…was it done when he got back?…daft question…because out of sight was definitely out of mind!

The result is that he’s even more tired than he was before his holiday. Now he’s updated his CV (Resume), bought a new interview suit and is looking for a job and has some interviews even before he’s formally applied for a position. I wonder how the people who’ve said “What would we do without you” will cope when he’s gone!

Cost of replacement and restructure…could be huge!

A couple of days ago I was speaking with a Sales Director who asked “why is finding good salespeople is so difficult”. In the new economy creating and retaining a team of good salespeople is a major differentiator, yet too often a new hire fails to live up to expectation. The costs can be enormous and the Sales Director seemed at his wits end.

Road to Damascus
The new economy means that recruiting and integrating salespeople the way it’s always been done is no longer going to work. With constrained budgets salespeople have to have heightened awareness of different but related areas of their performance. 

To illustrate this I showed the Sales Director the Transition Maps that my colleagues and I have developed over the last few years. “Oh my goodness, now I see where we are going wrong!”

It’s always gratifying when Road to Damascus revelations happen and I had to restrain the Sales Director from taking part of the solution and applying it like a sticking plaster to all his sales hire problems.
 
Main problems
We were able to identify a number of the problems that are common to sales team recruitment and development. The first is accepting what a sales candidate says about their past achievements at the interview without probing their actual involvement. The second is trying to clone a “current success”.

Review of process
Finally we reviewed how the company integrated salespeople into his team. Dispensing with the “one week induction” and replacing it with a transition map dovetailing all the required competences identified for their success.

I’ve spent time working with a company where there is some conflict over strategy. Senior managers are arguing over strategy and each side writs off the others as being obnoxious and unreasonable. In reality the each side is making the other angry because people aren’t getting their way.

Right or wrong recipe
Over the past twelve years I’ve dealt with conflict within teams and between teams, conflict with subordinates and the boss so often that I know that the recipe is less a matter of right or wrong ingredients and much more likely to be a clash of styles seasoned with a pinch of insensitivity and a couple of drops of emotion.

The first thing I try to get people to understand is that conflict, in itself, is not always bad. A business where everyone agrees with the management and each other has a natural barrier created for its own potential and growth and possibly a poor culture if employees are afraid of reprisals when making challenges.

Ten keys to dealing with conflict
There are lots of systems to understanding and handling conflict such as the Drama Triangle developed by Dr Stephen Karpman in 1968 but my ten keys which I discussed with the combatants are these:

1. Listen to what’s being said. Be logical and observe body language as well the words
2. How important is this on a scale of 1-10. If it’s unimportant why argue?
3. Make efforts to understand the other persons position
4. Empathise with the other person’s argument and ask what the other person expects to happen and what the results will be for them
5. Avoid emotion
6. Clarify or set boundaries for behaviour and outcomes. This can be done by asking all parties to write down the boundaries and expectations, roles and outcomes.
7. Ask the other party to explore issues and alternatives (Use facts) and use open ended questions, “How would that…” “what would be the effect if…”
8. Don’t attack the person. Attack the issues
9. Say something positive about the person. This has the effect of often defusing emotions and says that you aren’t attacking the other’s character and that you have respect for them
10. Ask if my approach is appropriate and effective and be prepared to change tack if the conflict continues

How do you deal with conflict?

A couple of days ago I was telephoned by Barclays Bank call-centre. The caller was enquiring if the business was “happy with the service I was receiving from the bank”.

Happy with my bank?
Now moving bank is a tedious and time consuming operation and something only done if one is very upset with the level of service or to make substantial savings. I will say that I’m not unhappy with my bank, HSBC, and I told her this. Nevertheless, after discussing the business history and some of our future plans she persuaded me that a visit to the branch of Barclays could highlight some useful benefits. A convenient appointment with the branch Business Manager was made.

When I sat down with the “Business Manager” to discuss how Barclays could help my business it became apparent that he thought I was to “open a new account”. He didn’t “sell” Barclays as an alternative banking possibility and was confused as I sat there expecting to hear some “good news” that would encourage me to move my account.

Intrigued by the lack of awareness of my visit I questioned him and he confirmed that he had not spoken to the person who generated the appointment. As a result he knew nothing about me nor my business other than my name and the time of my appointment.

We agreed that by arranging the appointment for me the operator had simply fulfilled her objective of getting appointments with him. So, despite being told to the contrary, it was now obvious that the Bank’s staff were no more interested in me or my business…simply fulfilling their quota and meeting targets.

A costly lost opportunity?
The problem was that in fulfilling their individual targets the bank’s team had completely missed the larger target, which was to persuade me to to move my money to their bank.
As a possible customer my resulting view of Barclays is that it’s inefficient and doesn’t even to communicate between cross functional teams. Good for my business?…probably not!

It was a wasted opportunity for the bank, wasted time and money in contacting me and via this blog some avoidable adverse publicity.
Was it a waste of time to me… absolutely not…I had the topic for another blog post!

Yesterday I had a very interesting telephone call from a friend who outlined some changes he was making to his work team. After an hour of listening to his proposals and the reasons why he was changing people’s work objectives and targets I couldn’t fault his logic.

The research for the “need to change” had taken six months and loads of statistics analysed and, as a result, the proposed alterations in people’s jobs and deliverables were both logical and led by market expectations.

I then asked “So what’s the next step?”
I’ve called a meeting of the team at the start of January and I’m going to tell them”.
“And what do you think their reaction will be?” I asked
“Some will agree and some will hate it…but they’ll just have to do it!“

It took me some time to explain to my friend that whilst he had spent six months of research into generating his ideas he was proposing to give those affected just a few hours to understand the logic and accept it. In fact he was hoping for universal acclamation and presumably “thanks” for his hard work and his proposals.

Too often those that plan team restructure have lived with their thoughts for many months. Their thought have gone through the process of  rejecting some ideas and accepting others to create a logical outcome. When introducing change there needs to be an understanding that those affected will move through similar thought processes and need time to do so.

This is because resistance to change is built into the very structure of most companies.