Monday Mornings with Madison

Yearly Archives:
2017

The Many Facets of Leadership – Part 3

Hiring managers often claim to prefer employees with the right character traits and organizational fit over those with the right education, training, skills and experience. They want people with a positive attitude, drive and passion. But what they are really looking for are people who exude confidence. Finding a highly confident employee is viewed like striking gold! Why? Confident people are seen as being self-assured, reliable, assertive, positive, dependable and steady. Confident people also tend to be charismatic, extroverted, and have strong social skills. In most cultures, these are highly desirable qualities. Also, in practically every culture — but especially in the technologically-advanced, developed world – confidence is equated with competence. We automatically assume that confident people are able, skilled and talented.
On the surface, this sounds right. Who doesn’t want to hire a confident go-getter!? However, this is the epitome of judging a book by its cover. Managers often hire people based on confidence rather than on their actual ability to do the job. That’s because employers commonly confuse confidence for competence. In fact, they even sound alike. This is especially true when filling leadership positions. Unfortunately, confidence is the pyrite — or Fools Gold — of leadership traits. On the surface, confidence looks like competence… attractive and desirable. Employers trick themselves into believing that confident people make competent leaders… and that confidence is better than modesty, especially in a leader. The manifestations of hubris — often masked as charisma or charm — are commonly mistaken for leadership potential. In reality, confident people are often not competent at all. Why is that? And, if that’s so, how can companies learn to distinguish between cotton-candy confidence and real competence? Continue reading

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The Many Facets of Leadership

Imagine that a company or business is like a boat and the boat has a destination… the port of profitability and growth. On the left side of the boat are the Marketing oars. On the right side of the boat are its Sales oars. If only the left oars are rowing, the boat will go around in circles, clockwise. And if only the right oars are rowing, the boat will go in counter-clockwise circles. Even if both sets of oars are rowing, but not in tandem, the boat will not move in the intended direction very swiftly. But if both sets of oars row in tandem, the boat will move forward. If guided by someone who knows the destination, it will move toward that spot. And the faster and more efficiently they row in tandem, the more swiftly it will get to its destination. The process of getting all the oars to row in tandem, efficiently and effectively, to a particular designation is management. Getting there faster than the competition is good management. And leadership is the wind in the sails of the vessel, which can help propel it even farther and faster. If the leadership is strong and steady, the work of the sales and marketing teams is made easier, and everything glides forward quickly.

Great leaders make the difference between an average performance and an extraordinary one. Today’s leaders do many things, including coaching, mentoring, counseling and, of course, managing. Employees today expect people in leadership roles to be willing to roll their sleeves up and keep managing and facilitating. In practical terms, what does good management look like today? It is more than just someone telling someone else what to do. Continue reading

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The Many Facets of Leadership

Much has been studied, researched, written and taught about leadership. There are even entire doctoral programs in leadership at prestigious universities. That’s because, arguably, good leadership allows companies to succeed when they might have otherwise failed. And great leadership pushes companies to rise above an ocean of mediocre ones. That is why the most successful investors — think George Soros and Warren Buffet, who achieved annual excess returns 15% over the S&P for over 30+ years — spend an inordinate amount of time every day studying not only a company’s financials but also the skills and track records of the leadership at those companies. Companies with the most innovative products can still fail to thrive without well-developed leadership. To state the obvious, leadership really matters.

Also, great leadership skills are not just essential for Presidents and C-Suite executives. Great leadership is invaluable for those directing divisions, departments, teams and projects. That’s because leaders are responsible for managing finite resources as well as planning and executing direction and action. In particular, one of the most important responsibilities of a leader is to help employees develop the skills and knowledge they need to succeed. That is called coaching and it is a key facet of leadership. So exactly what is coaching and what makes a great coach? And is there a difference between coaching and other things leaders commonly do such as managing, mentoring, teaching and counseling? Continue reading

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The Effect of Abundance and Scarcity on what Customers Value

Rabbi Avigdor Miller once marveled at the notion that “two gases [hydrogen and oxygen] — neither of which can quench thirst – can be united into a clear and sparkling liquid which pours down one’s throat in a life-giving stream.” He added that “No liquid in the world can take the place of water for relief of thirst. This fluid is the most potent of all elixirs, although its availability and its inexpensiveness cause it to be overlooked. It is the universal solvent and the vehicle of digestion and of blood circulation. If water could be obtained only from the pharmacist, it would be the most costly of liquors, both for its vital properties and for its enjoyment.” And yet, most likely very few in the U.S. open a faucet and marvel as water pours out… precisely because it is so abundant and available.
Yet, in places like Somalia, South Sudan, Nigeria, Yemen and even places in the U.S. such as Flint, Michigan and drought-affected parts of California, water is very scarce and the cost (and value) of water has skyrocketed. In such places, people have a genuine and profound appreciation for clean drinking water. That’s because the value of everything is deeply affected by abundance or scarcity, whether the item is essential for life or not. In the U.S., the abundance of water has caused the value of “this most potent of all elixirs” to be mostly taken for granted. On the other hand, other commodities that are not essential to life – such as diamonds, gold, rhodium, platinum, plutonium, taaffeite, tritium, painite, californium – are highly valued because of their scarcity, even if they have no life-giving properties. This value is subjective. This is known as commodity theory, and it is something that every entrepreneur, business leader, and sales professional should understand thoroughly. This is where the laws of economics and the actions of sales and marketing professionals meet. Continue reading

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The Art of Negotiating Business Deals

One of the most challenging parts of working with a new client is finalizing the business agreement. This is the process in which the parties hammer out the details of the contract. The bigger the deal, the more complex the agreement. And negotiating the final terms of a complex deal can have its challenges. In those situations, a sales professional might find himself in a position where the customer holds all the cards. The salesperson may have invested a lot of time and effort in developing the opportunity. He may have even promised his boss that a commitment was imminent. The salesperson may feel boxed in and the customer may think he can dictate the terms. That’s a losing proposition for the salesperson and his company, even if they land the deal. Business deals that start out very lopsided – a win-lose proposition – don’t bode well for a good long-term business relationship.
The goal in any negotiation should be to achieve a win-win outcome. That may sound cliché and idealistic, but it is the secret to long-term success. But if the sales professional starts negotiating from a weak position, it will be hard to hammer out a win-win contract. To chisel out a win-win agreement, a sales professional must garner some negotiating power and then use smart negotiation strategies during the process to close the deal. Here are some tips. Continue reading

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Using Chess Strategy in Business, Part 2

There are many benefits that come from playing chess. Psychologists often cite chess as an effective activity to help improve memory function. That is probably why chess is recommended in the fight against Alzheimer’s. Playing chess can also help the mind solve complex problems and work through ideas. It is also thought to increase one’s intelligence, although that’s not been scientifically proven. And the effects of chess on children – which has been correlated to children getting better grades in school — has led to chess being introduced in schools in a multitude of countries. That said, many are still intimidated by chess because it is perceived as a game for geniuses. But while chess is a thinking-man’s game — one that requires a great deal of strategic thought and tactical reflection — it is not just for geniuses and savants. Anyone can learn to play chess and improve through study and practice.
Indeed, many past and present political and military leaders – including U.S. Presidents Thomas Jefferson and James Madison, Sigmund Freud, Queen Elizabeth I and II, French Emperor Napoleon Bonaparte, former U.S. Secretary of State Henry Kissinger, former U.S. Vice President Spiro Agnew, British Prime Minister Clement Atllee, Alfonso King of Spain, and Vladimir Lenin – all played chess. Many titans of industry also play chess, including Bill Gates, Co-Founder of Microsoft, Billionaire Investor George Soros, Carl Icahn, Chairman of Federal-Mogul, Peter Thiel, Co-Founder of Paypal, Jared Heck, co-founder of GroupMe and Fundera, Seth Bannon, Founder and CEO of Amicus, and Victoria Lipschitz, CEO of Grid Dynamics. In fact, Boaz Weinstein, chess player and head of Saba Capital, once said that “Chess helps me in trading, teaching me to focus on the important decisions and to accept risk.” Last week, we looked at a few useful strategies. Let’s look at some more chess strategies that can be applied to business. Continue reading

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Using Chess Strategy in Business, Part 1

Chess is one of the fairest games there is. In chess, opponents start with an identical force. The entire playing field of a chess game is out in the open. A player can see every move an opponent makes as soon as he makes it. And, in chess, no dice are used so it is never a game of “chance” and there is no luck of the draw. Moreover, there is no referee involved in chess that might “throw” a game or be partial to one side over the other.
The business world is perhaps not as fair, balanced and chivalrous as a game of chess. In business, competitors seldom start with identical workforces, and a company can easily hire a better force. In business, a lot of deal-making is done behind-the-scenes and a company might not learn about a competitor’s initiatives until much later. And, in business, a company can innovate a product or service – or how it delivers that product or service — in ways that totally change the playing field for competitors. In fact, a company can innovate to the point of actually changing the game. Think of how Uber has revolutionized short-distance transportation and how Airbnb is changing the hospitality industry.
So, in many ways, business and chess are different. That said, chess is all about strategy and tactics. The best chess players are those who have the ability to stay ahead of their opponents and strategize goals that can be achieved as quickly as possible. In that regard, running a company is a lot like a game of chess. To stay ahead of the competition, companies must think strategically and be quick to implement. That’s where chess strategy can give business leaders guidance. While many games use methods that can be incorporated into how business decisions are made, chess requires strategic decision-making, connections, timing, tactics and evaluation. Continue reading

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How to Spot and Hire A Players for Key Positions

When organizations hire employees for key positions, they want superstars. They want rainmakers and movers-and-shakers. Basically, they want A Players. They certainly don’t set out to hire 10% A Players, 80% B Players and 10% C Players. But that’s what most companies have. Still, it is fair to say that no recruiter ever hired someone knowing he would be a C Player, nor could he have known with certainty who was an A Player and who was a B Player. If only 10% of the employees at most companies are A Players, then clearly HR departments are hiring lots of B and C Players. That implies that it must be hard (or should we say nearly impossible) to distinguish between A, B and C Players.
The truth is that it is a challenge to distinguish between A, B and C Players. But when hiring for key positions, spotting A Players is essential. Certainly, companies more capable of spotting and hiring A Players for key positions will likely grow and thrive. A Players are the ones most likely to deliver creativity and innovation. They are the ones most likely to drive productivity, growth, and sales. They produce results. By the same token, it is reasonable to conclude that companies that have trouble identifying, hiring and keeping A Players will likely be less successful. So how does a manager spot and hire the A-list for his roster when they are not only hard to spot, but also when every other company is vying for the same top talent? Continue reading

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A-Players vs. B-Players: Understanding the Value of Each Type of Employee

Employees are the most valuable resource of any company. From Apple to DeBeers to Walmart, employees are the ones who lead, manage, create, innovate, implement, interact and engage with others on behalf of the company. Only in the smallest companies do the owners perform the majority of the work. In most other companies, employees do most of the work that generates profit. For that reason, recruiting and hiring individuals with the skills and qualities to fit specific openings is the hardest thing any company does… even in the most successful organizations. And it doesn’t matter if the position is an entry-level receptionist, a seasoned salesperson, a highly-technical professional position, or C-Suite executive. Each opening has an ideal set of skills and qualities that would be the best fit for that job at that company. But the more remarkable the skills and qualities needed in an employee, the harder it is to find the right person to fill that job.
Given the importance of employees, one would think that companies should seek to only hire the most talented and successful candidates for every opening. They are often referred to as A-Players. But in reality, it is neither practical nor necessary for every employee at a company to be an A-Player. The truth is that not every opening at every company requires an A-Player and most of the time B-Players are a better fit for the majority of openings. What’s the difference between an A-Player and a B-Player (and what’s a C-Player)? When is it essential to hire A-Players? And how does one tell the difference between the A, B and C-Players when they apply for a job? Continue reading

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When “Company Policy” Creates Lifelong Customers… for the Competition

There are three little words that help businesses create lifelong customers more effectively than practically any other phrase: “It’s company policy.” The problem is that those words create lifelong customers for the competition of the company saying that to its customers. For businesses that want to drive their customers to the competition, have at it. Use that phrase to your heart’s content. Better yet, just close your doors now and save yourself the time and slow agony of going out of business the old fashioned way… failure to make money.
Let’s face it. Saying “It’s company policy” to a customer is just a nicer way of saying “We don’t want your business.” That is what a customer hears when an employee blames “company policy” for an unwillingness or inability to solve a problem or accommodate a request. And when a manager says “It’s company policy” to an employee, he is saying “If you don’t like it, go work somewhere else.” As technology and innovation continues to disrupt industry after industry, leaders and managers will be forced to decide whether they are going to stick-to-their-guns and cling to outdated company policies that kill business and alienate employees, or whether they are going to innovate and evolve with the times. Continue reading

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