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Jan 20, 2014

How organizations miss an easy, obvious HR boost in results

Why we keep missing the obvious is, well, pretty obvious

By Dave Crisp

Having time to read takes one through fascinating pathways that illustrate how much management, leadership and HR thinking is changing among those in the know.

Last week, a retail newsletter I keep up with out of interest in a former job pointed to a lengthy annual report by Deloitte that has massive, useful stats on who’s big in retail and “etailing.” Even more startling was a very short item buried on page 11 about challenges for retailers. As you’d expect, keeping up with technology is a major one.

Almost in passing, they identify the other in a few added words: “Primary among these is the overwhelming amount of unstructured data to be managed and organized for use.... We will also need to reinvent how we humans process and use data.”

Got that? “Reinvent how humans....”

Then they post a very small chart listing five weak “Conventional Business Approaches” (hierarchies that discourage creativity, cultures that don’t reward risk-taking such as throwing out the current business model, capital investment that doesn’t reward continuous improvement, legacy systems and established infrastructure and business models that block innovation).

Next to these they list seven “Unconventional Approaches (needed) to Address Change” (entrepreneurial structure, flexible teaming and collaboration, fast failure and learning strategies, being responsive and adaptive, crowdsourcing and sharing ideas, listening/engaging with customers and employees and innovation with focus and purpose).

In less than two paragraphs, they outline this as if it can be taken for granted. And it should be. We’ve seen the impact of the new model often enough and the weaknesses of the old, yet buried here is also recognition that only a minority of businesses are changing, otherwise we wouldn’t still be talking about the flawed model as the "conventional" one. Take note that every single unconventional change we need is a change in how we manage and lead people. Remember this is just a toss-in item in the midst of a long stats report, yet it is a "taken for granted" view of what the most effective companies are striving to do.

If we keep taking this stuff for granted, but don’t do anything about it, poor us. This is just one industry, but their comments and the lack of action could be said of virtually any industry you want to name.

Flash to another interesting article in the Washington Post hailing the fact the new CEO at GM, Mary Barra, is one of a relatively few CEOs who have HR experience. The columnist quotes a big name recruiter/CEO/board adviser who notes three things:

1. How and why this is unusual.

2. How more boards are working on partial remedies (albeit for not quite the best reasons yet).

3. Recruiters still don’t think HR is a typical place to look for CEOs.

The muddled excuse for point three is interesting — that HR is already part of the CEO job description (to be the chief HR person and worry about talent). What this misses is that, even more important than worrying about great talent and how to get it, is the problem of how to keep great talent motivated, engaged and innovating, which requires CEOs who build or support the right kind of organization environment — the seven things Deloitte notes, for instance, which we see are not happening much.

Talk about speaking from both sides of one’s mouth: We think CEOs already worry about talent... but we note they don’t do the right things about it and we aren’t trying to fix that by placing people who would. People are most important, but we will continue to recruit and appoint people we know don’t know the best processes.

Then take a look at Harvard Business Review’s discussion of Google’s Project Oxygen, which we’re covered before (but Harvard hadn’t done its thing at that point): How Google Sold Its Engineers on Management. Project Oxygen, of course, was the model-breaking statistical study that identified the eight most critical leadership skills, with tech skills last in order on the list and coaching at the top. (The full article is reachable with a no-cost registration as well as purchase.)

We’re reminded of the complexity of the study (which required three PhD stats experts to crunch) and the value of being able to do it on your own organization (so you know exactly the context and components of the eight factors). However, as the article points out, these factors have been known for a long time and are known to be common to all organizations.

Yes, we may want to tweak coaching to fit our business and Google discovered in detail how it could, but the core elements of coaching are known, the core elements of pushing for results, delegating initiative, not micromanaging. All the eight are known and plenty of help is available to adapt them to your operations if you need help. All Project Oxygen really adds is proof positive that the most exhaustive statistical dissection of the value of leadership will once again reconfirm what we know (but in most cases don’t apply).

The other excellent point in the article is a simple comment by just two people. One Google manager is described: “A seasoned software-engineering manager and serial entrepreneur, (he) had led teams for 18 years before Google bought his latest start-up. (Emphasis mine: In other words he was a CEO.) But he feels he learned more about management in six months of Oxygen surveys and people ops courses than in the previous two decades.”

Google instituted a training program of just six days in three two-day modules over six months.

The second example, a senior sales manager acquired from Oracle (where you can be sure there is a bad example to follow as per previous posts), is quoted: “I raised my favorability ratings from 46 per cent to 86 per cent. It’s been tough but very rewarding. I came here as a senior sales guy, but now I feel like a general manager.”

If all it takes is a six-day course, why isn’t every company on the planet copying this and gaining the proven benefits? We’re not talking likability, but palpable financial results as well. Google itself pegged better leaders as two to three times more successful — that’s 200 per cent to 300 per cent better in measureable results, not just five per cent or 10 per cent.

Why? Because people at the top think they already have the skills and they aren’t paying attention to the exploding body of literature that says otherwise.

Dave Crisp is a Toronto-based writer and thought leader for Strategic Capability Network with a wealth of experience, including 14 years leading HR at Hudson Bay Co. where he took the 70,000-employee retailer to “best company to work for” status. For more information, visit
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