Archive for the ‘Leadership’ Category

The Entrepreneur’s Uncommon Legacy

Friday, June 30th, 2017

90% of entrepreneurs want to leave a powerful and lasting legacy upon the successful transition of their business, yet most fail. I define “legacy”, in a business context, as a framework within which decisions are made today about sustaining the beliefs that will enable the business to thrive in the future.

Failure is not in my experience down to the most obvious reason (renouncing control) rather it is the absence of people, long before the sale of the business is concluded, with the skills and volition to implement the entrepreneur’s desired legacy in the real world, and constant procrastination. Here is a simple checklist for the Entrepreneur:

  1. What would a successful legacy look, feel, touch, smell, taste like to those who are important to you and in what realistic timeframe?
  2. Whose support must you command upfront (exemplars, key influencers) to sustain it?
  3. What specific goals are you trying to accomplish internally and externally (e.g. improve succession planning, more impressive innovation, heighten customer awareness of societal issues etc.)?
  4. What elements need tackling first (e.g. strengthen career development, prioritise resource to performance improvements not fixing problems, identify exemplars etc.)?
  5. What must be done tomorrow and the day after?
  6. By whom and by what deadline?
  7. Do it.

If you need additional expertise, hire it. One of the biggest mistakes is the assumption that the content knowledge your coterie of existing advisers and top managers have about the inner workings of the business is sufficient to succeed. Here is the litmus test for the Entrepreneur:

  1. Do my key people possess a high, moderate or low level of familiarity with my legacy?
  2. Do my key people possess a high, moderate or low level of clarity about my legacy?
  3. Do my key people possess a high, moderate or low level of skills to implement my legacy?

Better to have started early, tried and failed than for the entrepreneur to look back with regrets about the mistakes that were made by not being bold enough or making it your priority, before the business was sold.

© James Berkeley 2017.

Corporate Innovation Comedy

Thursday, February 4th, 2016

There are certain fashion or fad trends which when worn by 60 year old men, skinny jeans come to mind, are just plain wrong unless you are Mick Jagger. In all the buzz about innovation, reinvention and disruption it is comedic watching the attempts of some corporate organisations in finance, banking and insurance to embrace it effectively.

The CEO stands up and says

1. “Innovation is the new normal”: err, innovation is not a rheostat with an on/off switch in outstanding innovative companies such as 3M, Merck, Apple etc.

2. “When I was at Google….”: err, you met with a middle manager or silo function (risk management) that is not even situated in the Corporate HQ. Ssh, the guy is an ex employee of ours suffering a mid life crisis but it sounds cool?

3. “We are on the side of the disruptive businesses…”: really, where is the hard evidence? Ah you have put in an order for the Tesla when the lease on the Merc expires.

4. “Let me tell you about our work with [Uber, Airbnb]…..”: your “credentials” are killing me, how are a series of actions unique to one firm now a hot trend?

5. “We took our Leadership Team to Silicon Valley….”: so you flew into San Jose on the Gulfstream, spoke to a few random clients and friends and are now immersed with ground-breaking ideas, really? Ever tried the pilgrimage to Lourdes? Thought not.

6. “I was speaking at a Tech investors event in Silicon Valley…”: you are now on first name terms with Marc Andreesen and Fred Wilson. Keep that one for the next earnings call.

7. “We are passionate about the future. We are announcing a new corporate venturing team with a $100 million of capital”: wow, so third rate entrepreneurs line up outside our headquarters. After all why would a stack of cash and a conservative reputation not appeal to serious tech entrepreneurs? Oh, nevermind.

8. “I am really excited by the power of blockchain as a powerful asset”: half the audience look blankly. The venerable City reinsurance broker or Wall Street banker racks his brain “watch chain?”, as the CEO fumbles like an adolescent boy trying to unhook the girl’s bra, in explaining blockchain’s virtues and his excitement.

9. “I have asked our Divisional Heads to set up an offsite meeting on Innovation and Disruption….”: yay, a chance to invite Wired’s David Rowan to talk to us about 10 transformative technologies. Oh hell, which futurologist should we invite? No giggling or fumbling for the iPhone and that important email when he or she stands up.

10. “It is time for the results of our Annual Report on Megatrends, we spoke to our global community of risk managers…..”: ah, that is the fella situated down the end of the first floor corridor with an actuarial background and a handful of junior direct reports. I don’t remember seeing his face in the Corporate Strategy meeting, perhaps he was at his daughter’s soccer game.

I kid you not, these are all genuine one-liners. Sorry I am bent double admiring the CEO’s shiny white teeth and folksy humour. Nice touch.

© James Berkeley 2015. All Rights Reserved.

 

3 Reasons Business Leaders Should Trek To Glastonbury

Friday, June 26th, 2015

Over 250,000 people will descend on a sleepy corner of Somerset, England for the Glastonbury Festival today. For some an annual rite of passage and others an introduction to an experience their Parents still rave about some 30 years after first making the trek.  There are acts of their Parents generation (The Who and Paul Weller) and their grandparents generation (Burt Bacharach) joining today’s megastars (Pharrell Williams and Kanye West). The event is a classic example of the three “R’s”: relevance, recognition and reinvention as its’ market’s needs and ideal buyers have changed. “Relevance” in the form of is the experience what our ideal buyers need (introduce hospitality chalets alongside the pitched tents). “Recognition” that the time is now for bold changes and adaption of our beliefs (infuse rappers and uptown funk with a rock heritage). Finally a constant commitment to “reinvention” (introducing new acts to regular attendees and old acts to new attendees).  It sounds simple and when you look at market-leading businesses it is universally a trait that keeps them at the forefront of their competitor set. Yet for a great many firms and indeed sectors (private banking, insurance, legal, accounting and audit firms) it is something that they struggle with hugely. It is first and foremost a leadership issue. Great leaders are willing to champion change. They lead from the front with their eyes focused on the stage, not the disheveled hipster swaying in front of them. They listen intently and consistently ask the right questions at the right time. They apply that knowledge rapidly to the critical organisational issues impacting their firm’s future and make wise decisions consistent with the strategic direction of the business. Are those the very same traits your leadership regularly exhibits and you hire for? If not, why as a client, employee or shareholder should I return each year to listen to your tired line up of fading musicians playing music that is boring and increasingly irrelevant to my future?

© James  Berkeley 2015. All Rights Reserved.

Social Confusion

Monday, June 8th, 2015

We are all in the communication business today whether we like it or not. If that is the case shouldn’t we place a greater emphasis on great communicators when we decide who to hire in or promote to senior or executive levels?

In certain sectors insurance, banking, asset management and private equity a belief has existed in many quarters that there is little or no need to communicate beyond a bare minimum outside of their key constituents – shareholders, investors, clients, employees, business partners and regulators.

Indeed, many market leaders have such strong and powerful brands that business “walks in the door” with minimal marketing investment (Munich Re, Goldman Sachs, MAN or Blackstone). These firms are the exception but the need to be outstanding communicators is no less.

What communication skills and volition should you be looking for, nurturing or developing in a market-leading business:

1. Superb language skills – it is not sufficient to simply be able to talk impressively about the “content” of your firm, market or industry (“what you do”). You must be able to explain in simple practical steps the “how”, the process of improving your clients, shareholders and the wider public’s well-being. You must provide relevant and interesting examples, use metaphors intelligently and share impressive insights that are highly relevant to the listener.

2. Ability to Control the Discussion  – you must have superb communication skills to move the conversation naturally towards your intended goal. Knowing at all times where you are in the conversation and what you must say or do next.

3. The Discussion Must Move the Relationship Forward – in most case it is insufficient to simply make demands, you must create an empathy with the listener in your social interaction and intellectual agreement such that they realise that THEIR best interests are served by following your advice. You don’t have to be liked but you most definitely have to be respected.

4. The Relationship Must Discernibly Be Generating Results – those results don’t have to be tangible, indeed the intangible (greater peace of mind or personal security) or peripheral results (promotion, new opportunity or referral) that arise from following your advice might be even more valuable. However there must be a discernible benefit for both parties otherwise why invest time talking in the first place? I observe that this realisation comes as a shock to many seasoned managers and client facing people when they are challenged about the return on their time invested in daily activities.

Many businesses are in what I term a state of “social confusion”. A great many people confusing a desire for greater levels of affiliation with their key constituents and meaningful conversations. The result is excessive internal meetings, email threads and daily interruption. There is a fear amongst many people about addressing the issue (a fear of being unfriendly, dictatorial, disrespectful and so on). That is why this is a leadership issue.

Leaders set the expectations and hold others to account. Only leaders can rapidly resolve the confusion so long as their own behaviour is consistent with the behaviour they are demanding from their subordinates.

People talk about great orators being born, in business, superb language and communication skills can be readily honed. That pre-supposes you agree it is your priority.

Copyright James Berkeley 2015. All Rights Reserved.

 

 

 

 

 

 

 

A Legacy of Inspiration

Friday, April 10th, 2015

Waking up this morning to hear the sad passing of Australian legend, Richie Benaud. A cricketer, commentator and gentleman nonpareil. Above all an inspiration to generations of sports fans.

In business as in sport or life, there are many leaders, who are satisfied by acquiring great financial success and acclaim through their thoughts, words and deeds. There are a smaller number, who pretend to or aspire to leave a legacy of inspiration for those who follow in their footsteps. There is an even more rarefied space  with those leaders, who actually achieve that goal. Why sell yourself short and not shoot for that elevated status in your own career? After all a name on a building is just that a symbolic gesture but a wave of successors, who reference you as their inspiration is a meaningful legacy.

© James Berkeley 2015. All Rights Reserved.

Uncommon Leadership Traits in Profitable Growth Firms

Tuesday, March 3rd, 2015

Arguably the most common failing of organisations in search of profitable growth is leadership. I am referring to leaders, who are disengaged in the implementation of the firm’s strategy. Leaders with values that are incongruent with the firm’s new growth strategy. Leaders, who by their actions are seen to demean the importance of or pay lip service to the new growth strategy. I find this is most common in the operational layer of businesses (mid-level managers) although it is not uncommon amongst peers at the executive level. Here is three recent examples I have seen:

Example 1: The COO of an insurance company, who loves to make grand announcements (ego) about the transformation of the brand’s positioning. He steadfastly absents himself from from the implementation process, where his or her credibility and example, is essential to gain the support of and change the behaviour of his peers and subordinates, in support of the new strategic direction. Unavailable for subordinate meetings, delegates all responsibility and becomes angry when results don’t happen as planned.

Example 2: The mid-level manager who says “I know Head Office want us to be seen as the “trusted adviser” of the client but frankly I see our future best served by selling more of what we know (existing products).” Surprise, surprise the client relationships never change. The top line revenue growth stalls. The organisation is merely known for its’ transactional capabilities and any “window of opportunity” to transform the business is lost.

Example 3: The sales executive, who is placed in the Regional CEO role (ego reasons) in a professional service firm. “I am sorry my diary is full with clients and prospects visits that I need to attend if we are to make this quarter’s sales figures. Let me get back to you when I have a slot to discuss this (strategic decision). I don’t feel comfortable without having everyone around the table and discussing the merits of each alternative and the attendant risks.” Strategic decisions are put on “hold”, frustration builds amongst subordinates and corporate gridlock ensues.

You might very well be laughing at this stage, recognising how close to home these examples are in your own organisation. One of thrills of helping clients profitably grow and expand, is you get to see first hand the victories and defeats in technicolour. It would be funny if it wasn’t that people’s livelihoods and careers are ultimately on the line, indeed, in certain cases the future of the entire organisation.

Any leadership role for a large or small firm has three attributes:

  • Physical capabilities (international travel, lifestyle changes, health and so on)
  • Skills (expertise, knowledge)
  • Behaviours

Leaders largely succeed or fail because of their behavioural traits, yet most firms give greatest thought to and weighting to the other attributes. Their role is to be the crossing that helps connect the current business with its’ future state. While this not an exhaustive list and you would be wise to customise to each situation, these are the behavioural traits you should be emphasising in a profitable growth business in today’s economy:

  1. Impressive Exemplar (high resistance to short-term pressure and self-interests)
  2. Champion of change
  3. High Assertiveness (focus on speed and momentum towards growth goals)
  4. High Persuasiveness (strong appeal to subordinates self-interest)
  5. High Enthusiasm
  6. Superb Communication
  7. Readily Accessible
  8. Logic over emotional reasoning
  9. Excellent listener
  10. Big picture thinker, not micro manager
  11. Adaptive to prevailing conditions
  12. Prudent risk taker
  13. Innovation / creativity
  14. Voluntarily shares credit for success
  15. Willingly admits and takes ownership of failure
  16. Ethics / Integrity

I am always saying to my clients profitable growth is a mirage unless you have leaders and people throughout the organisation, who are talented AND passionate about implementing the growth strategy. I cannot, nor can my clients, motivate a leader or a subordinate but you can sure raise the odds of success by first hiring someone into a leadership position with the requisite behavioural traits.

© James Berkeley 2014. All Rights Reserved.

Life Immitating Art

Thursday, May 1st, 2014

Bob Hoskins’s sad passing this week reminds me of an intimate Grand Classics screening, almost 10 years ago to the day, when he shared his inspiration for a career in the movie business, Jules Dassin’s crime movie, Rififi. For those not familiar with the French crime film, it is an adaption of Le Breton’s novel of the same name. The centrepiece of the film is a 30-minute heist shot with barely any sound or music. The viewer is drawn to the difficulty of pulling off the heist at the heavily alarmed rue de Rivoli jewellery shop, the ability of the gang leader to communicate successfully through his actions and in so doing, to inspire the other gang members to follow him without fear for their own well-being.  While the rest of the tale revolves around rival jealousies and settling of old scores between different gangs, there are some interesting lessons for business leaders entering into highly ambiguous growth markets.

  1. Effective leadership is largely about “doing” (action), not “saying” (empty mission statements).
  2. It is about discipline and a clear line of sight  on the long-term objective (goals or improvement), while navigating foreseen (customer preferences, market demand) and unforeseen short-term obstacles (entrance of a large competitor) that might trip the alarm bell along the journey
  3. It is about setting clear accountabilities for everyone in advance (sales and marketing, operations, finance, human resources etc.)
  4. It is about establishing trusting relationships and powerful alliances with key individuals, who you implicitly trust and are critical to attaining your goals
  5. It is about coming to terms with your fears and maintaining the right perspective. “Perceived” but not real fear (failure, embarrassment),  “actual” fear (growth projections disabled by incorrect market assumptions) and those that might have catastrophic consequences (loss of personal wealth or your position).
  6. It is about doing a small number of things that you are competent and passionate about exceedingly well and often.
  7. It is about making the complex (breaking into a new market), simple (practical actions others can routinely undertake with measurable results and a clear understanding of the value).

Whether, you are a private banker targeting new Chinese billionaires, a senior partner in a Professional Services firm expanding into Indonesia or an global insurance company seeking to exploiting demand from your corporate customers for increased protection from cyber crimes, it is not so difficult to accomplish, so long as your focus is on what really matters.

© James Berkeley 2014. All Rights Reserved.

The Real Repercussions of CEO Indiscretions

Wednesday, April 30th, 2014

Why do the revelations of a CEO’s affair with one of his subordinates tell us more about his lack of respect and good judgement than the titillating events themselves? If the CEO is hired to profitably grow the business, then his first priority is to increase the probabilities that his key constituents (customers, shareholders, employees and others) will see their best interests served by his actions and his beliefs. I have assumed a “he” here because the overriding number of transgressions are from male CEO’s.

Some will argue that in this decade, the personal and professional lives of CEO’s are “separate”. Does that point of view have merit particularly where the CEO’s actions directly impact one or more key constituents?

The CEO position in mid to large-sized organisations has over the past 40 years become a powerful brand in its’ own right. That brand is built  on trust, fairness and equity.

  1. “Trust” in the form of putting the organisation’s  interests ahead of their own (corporate vs. personal risk and rewards).
  2. “Fairness” in the form of showing respect to their peers, subordinates, customers, shareholders and others they serve (leadership decisions consistent with the organisation’s core values and beliefs).
  3. “Equity” in the form of displaying good judgement commensurate with others and the position they are entrusted with (reward, recognition, ownership and so on).

When association with the CEO’s indiscretions has a negative impact on the organisation’s brand, all individuals concerned must be held accountable by the Board. When the Board elect to turn a blind eye, they are in fact diluting by proxy their own power and influence, not just the CEO’s, and their ability to positively impact the organisation’s future (results). That outcome is NEVER positive for any of the key constituents.

© James Berkeley 2014. All Rights Reserved.

iSpy A Dinosaur: State and Provincial Lottery and Gaming Boards

Monday, February 10th, 2014

140210 ICE

This friendly beast adorned the ICE Totally Gaming Show in London last week, where the great and good from the casino, lotteries, online and social gaming world converged to exhibit the latest technology, network and strike deals in the cavernous exhibition halls. Surprising to many was the noticeably higher attendance of senior lottery executives and government agencies from North America. The irony of the dinosaur cannot be lost on those running North American lottery and gaming associations. Mired in political machinations, declining customer spend, unfavourable demographics  and a chronic need to rapidly reverse these dynamics, the pace of change and results from top management is shocking at present. If six recent dialogues with Board Members and senior executives at State and Provincial agencies charged with a rapid transformation are a reliable bell-weather, the time for talking, hiding and procrastination must stop. Boards need to become assertive. Top management needs to achieve results. Here is a checklist for proactive Board Chairs:

  1. The Lottery/Gaming organisation has a competent top management (demonstrably possess the skills, behaviour and experience needed to achieve the organisation’s goals).
  2. The Board has established adequate benchmarks for top management’s performance and accountability in four key areas: allocating capital productively, hiring managers and key people, innovation, and the adequacy and reliability of strategic plans.It goes without saying that, of course, there must be accountability for return on investment.
  3. Top management are required to articulate their expectations in each of these areas  and the actual results are rigorously assessed by  the Board, at a minimum annually.
  4. Board Members have ensured that top management is properly staffed and structured.  It is not sufficient just to simply use the Board power and influence when there is a dysfunctional management group.  The Board is willing and demonstrably able to wield the axe where there is mediocrity amongst the top management.
  5. Top management are held accountable by the Board for succession planning and career development and ensuring that both are properly synchronised.
  6. Top management are held accountable by the Board to think through the businesses the organisation operates in today, and those that they should be in, and, equally critically, those business or businesses it should not be in, what businesses it needs to abandon, subordinate or even exit.  The Board though is not responsible for working out the strategy – that is top management’s responsibility.
  7. The Board holds top management accountable for the productivity of the capital and resources invested in the business and routinely sets improvements. I am talking here about investment in facilities and equipment, cash collection, people and time usage in key strategic functions that are critical to realising the lottery and gaming agency’s goals.
  8. The Board holds top management accountable for appropriate policies for key external relationships (unions, government, public disclosure, legal and regulated activities).  It is not enough just to have the policies, each area has performance standards in place, against which performance can be routinely measured.
  9. The Board requires top management to bring additional information to their attention, specifically, decisions on mergers or acquisition or exiting a product line, notification of lawsuits and decisions on long-term research and development investment.
  10. The Board has a clearly thought through role, clear goals, crisp objectives and transparent individual accountabilities for each Board Member.

My observation is that 90% of the Boards in North American Gaming and Lottery organisations cannot say “YES” to all of these points. Until that level of rigour and discipline is brought to bear on Boards by their direct reports in State or Provincial government agencies, no significant improvement is going to happen. Fact.

© James Berkeley 2014. All Rights Reserved.

Attracting and Retaining and Nurturing Talent

Thursday, January 23rd, 2014

Ellice-Consulting5-150

Creating an appealing workplace that attracts the brightest and best people doesn’t have to involve HR policies and lavish pay. Listen to three lessons from James’s best clients, who have got it right through setting clear accountabilities, making intelligent use of managers’ time, and incentivising the right behaviours in their frontline people.