Process Improvement

Understanding the Bigger Energy Picture

With average gasoline prices in the United States passing $5 per gallon this month for the first time ever, energy has really captured the headlines showcasing the very real impact on many people’s pocketbooks and way of life. This has reenergized the dialogue and debate over oil’s usage, the primary feedstock for gasoline, and politically the need to switch more quickly to wind and solar.

Unfortunately, our modern information world of cable news, twitter, and other forms of media showcases unbalanced snippets.  Having spent my career in the energy industry, over the years I have found it rather appalling at the naivete and lack of depth of understanding for such a complex energy/environmental system that fundamentally powers our standard of living.

In my blog of October 25, 2021, on Understanding the Energy Quagmire, the focus was on climate change highlighting the issues around renewable energy and fossil fuels.  My overall conclusion was we needed a more thoughtful balance of the risks and rewards of different courses.

Then in my blog of March 4, 2022, we looked at the concept of energy security being made up of economic security, national security, and environmental security. In other words, energy security plays a major role in the other three primary securities which are central to daily living. Today, we are seeing the impact on economic security which doesn’t receive much attention until energy prices rise significantly.  In the blog, I referenced a presentation that I had given in August of 2021 before Russians invasion of Ukraine.  I made the point in that presentation that we were underplaying the role of energy security in terms of its potential impact on national security, in other words, a lack of balance and foresight.  The Russia/Ukraine war has brought this reality to the forefront.

Today, I received an e-mail from Scott Tinker, Director, Bureau of Economic Geology & State Geologist of Texas who is a Professor at the University of Texas.  I met Scott through my role at the University of Houston’s Global Energy Management Institute at the Bauer College, and my leadership role in the GHP’s Energy Collaborative.  He is incredibly knowledgeable and insightful on the energy/environment complexities and recently produced a YouTube video entitled TEDx-The Dual Challenge: Energy and Environment. 

Scott really addresses the bigger energy picture in a balanced way. He has requested us to share this 17-minute video with friends, colleagues, and social networks.  It will give you much greater insight into the big picture reality of energy beyond simple snapshots through the media.  Please listen to his insight:

Highlighting Rich Hall

Silver Fox Advisors is proud of our members and would like for you to get to know them better.

Rich Hall has been a valued member of Silver Fox Advisors since 2020. He currently serves as a Board member, Chair of the Membership Committee, and Facilitator of two CEO Roundtables (The Woodlands area and in partnership with Houston’s Better Business Bureau).

As the founder of Rich Hall Group, he works with small business owners and leaders to help them achieve their vision of success for themselves and their company. He has extensive experience with family-owned businesses looking to grow, transition to the next generation, or prepare for a successful exit.

In addition to his advisory and coaching services, Rich is the proud father of 3 boys, Jeremy, Mark, and Daniel, and husband to his beautiful wife, Jamie. They’re active members of The Woodlands Methodist Church, and parents to pandemic puppies, Bucky and Riley.

If you would like to learn more about Mr. Hall, or Silver Fox Advisors, see our website at www.silverfox.org/directory

Top 5 Mistakes CEO’s Make When Trying to Grow Their Company

I work with a lot of CEO’s and a common trait is the desire to grow their company. Instead of reviewing how to grow, I thought I’d highlight some approaches that DON’T WORK!

Hire more sales people!

I was leading a CEO peer group when I heard a CEO say the solution was easy, “Just hire more sales people”.

If it was ONLY that easy.

Increasing revenue must come from an expanding market, new product or service, new form of lead generation, etc. Simply adding to your sales force will not ensure increased revenue.

Build it and they will come

This is not a baseball field.

Careful thought and planning should go into the product features, market demand, market research, buyer profiles, competitor analysis, etc.

Don’t build something new and hope.

Just work harder

I’ve heard owners say “we’ve got to grow and you’ve got to work harder”….as the CEO departed for happy hour.

How you grow is the responsibility of the owner/CEO and leadership team. Be very careful when you ask team members to work harder. That’s rarely the right answer.

Focus on increasing demand, not working harder.

Buy more social media ads

There are LOTS of gimmicks out there. People will promise leads through Google, Facebook, LinkedIn, etc. by hiring them. Don’t fall for it. If it sounds too good to be true, it usually is.

Can you generate leads via social media? Absolutely. It should be part of your growth strategy, depending on the industry you’re in.

If you’re unsure how, hire a reputable advisor to help you better understand how it works and to make recommendations.

Don’t chase the pretty penny

Most small business owners are entrepreneurs that get excited by trying new things. Unfortunately, many put their best and brightest on the new “project” while impacting the ongoing, bill-paying operations.

Consider developing a market research team of 2-3 people. Let them do the research and come back to you with a plan.

This doesn’t mean you don’t pivot when the market changes. A smart CEO always looks forward. Just don’t chase an idea without applying a process and logic to the approach.

Summary

We could probably come up with another 100 items a small business CEO shouldn’t do to grow their company. If you have additional ideas, send me a note at rhall@silverfox.org.

The Entitlement Virus Is Killing Your Company

“Entitlement and privilege corrupt.” — Vice Admiral James B. Stockdale

One quiet Saturday afternoon, I was sitting at my desk at the far end of what I assumed was an empty office with just me there. As I was working, I heard the printer down the hall spitting out documents. I looked at my computer to see that I hadn’t sent anything to the printer. I thought maybe it was malfunctioning, so I decided to take a look. Only one other office had its lights on. I moseyed over to where the printed documents were spitting out to see what was going on.

It turned out that one of my employees was about to resign and start his own company. He was planning to compete against us, and he was making copies of our proprietary business documents. Apparently, he thought he was entitled to take what he wanted. Had I not been there, this employee’s sense of entitlement would have resulted in our confidential information, which I had trusted him with, being taken.

The sad fact is that 95 percent of all companies experience employee “theft” of some kind. It may be as small as employees taking home office supplies, or it could be as serious as millions of dollars embezzled by a trusted bookkeeper.

Entitlement is a Serious Matter for Your Business.

A sense of entitlement thwarts you, your employees, and your company from meeting the challenges of competition and growth. In his transformational, still relevant, 1993 book, Stewardship: Choosing Service over Self-Interest, Author Peter Block writes, “At the heart of entitlement is a belief system that my needs are more important than the business, and that the business exists for my sake.”

I’ve dealt with this issue myself when a downturn in business during the Gulf War made me want to keep my employees at any cost. But, as I learned, the need to nurture familial-type relationships with employees was a double-edged sword.

When I related to my employees as if they were members of my extended family, I made it nearly impossible to hold them accountable for the things I needed from them. That created a terrible model for getting important work done —not only with my longtime employees, but especially with others who had joined later and realized this was a place where you didn’t really have to work very hard, be on time, do what’s promised, or even complete assigned duties with any degree of enthusiasm or integrity.

It took me some real reflection, but I realized, finally, that I was the original source of entitlement in my company – it was my fear, thinking and actions that created it.

What Is Entitlement, and Where Does It Come From?

Anyone who has ever owned or managed a business has likely experienced the impact of entitlement and wondered what to do about it. It’s a covert issue that can be difficult to recognize. Entitlement is most noticeable when leaders appear to be doing everything they can possibly think of to keep their employees satisfied and stay with the company, while those same employees demand more from the employment relationship and then withhold their commitment and performance if they don’t get it.

Entitlement will prevent you from executing your strategy, but it’s merely the symptom of more dangerous underlying conditions. Employees who think they are entitled often believe they are victims of management exploitation or mistreatment. Left unchecked, entitlement can result in covert acts of revenge. Therefore, it’s important to understand what’s at the source of your employees’ entitlement thinking. Your company’s future depends on it.

Patriarchy Is at the Root

Entitlement Virus can be attributed to two issues:

1. The fear of losing, which makes clients, employees, and others more important than the business.

2. A pretense of leadership that claims employees are more important than management, although, in fact, management furtively believes chiefly in its own entitlement. Entitlement is the result of a patriarchal belief system that most of us share—a belief system often designed around financial control and the idea that you must maintain a clear line of authority to operate your business: Entitlement implies that if you’re the boss, you are endowed with special privileges that others don’t have, and it arises when management wants to avoid being seen by employees as taking advantage of the system for their own gain.

Don’t get ahead of me here – there’s more for you to consider…

To believe in your own entitlement as a leader, you must first operate under the (superior) assumption that you’re making all the (mostly financial) sacrifices and that, therefore, you should be entitled to something extra. After all, it is your company. But, at the same time, you are trying to hide that you’re doing exceedingly well financially; you might even become indignant if someone suggested that you were making all the money and not paying others what they “deserve.”

Finally, you might be telling yourself that if employees knew how much you were “raking in” compared to what you pay them, they just might up and leave. All this kind of thinking allows you to prolong the fiction that no such issue exists. And that will come back to bite you because you’re only fooling yourself.

In reality, you ARE entitled to something special. You ought to be making significantly more money than your highest-ranking employee. Why are you trying to justify your salary to yourself? When you have a good year, do you jack up everyone’s salary? No, you don’t do anything of the kind. Instead, you find a way to give people a nice reward along with verbally demonstrated appreciation. And that’s exactly what you should do, not go off half-cocked out of guilt, trying to make it up to others for your good fortune. That’s just another pretense of leadership, and it’s the pretending that is hurting you.

Even if employees come and tell you that they think they should get a raise, having your best year in business doesn’t mean you have to start overpaying employees. Once you overcompensate by raising a salary, you can never bring it back down, if necessary, without consequences.

Who Has the Entitlement Virus, and What Does It Do to Them?

So, to paraphrase my friend Peter Block, the viral ‘meme’ that best encapsulates the Entitlement Virus is “The employees’ needs are more important than the business.” As for who has been infected by this viral thinking, the answer is: business owners/CEOs who are trying to prevent employees from withholding their efforts unless they receive extra perks. Employees will know when you’re trying not to lose business, not lose good employees, not lose your best clients, or not lose face.

Managers who are infected by the Entitlement Virus think they’re doing what’s best for the company by overlooking infractions such as coming in late or taking longer lunch periods. These are the things that my clients complain about most. What’s the big deal with a little tardiness, they ask themselves, or missing a client’s deadline, or helping yourself to a pencil or a pad of paper for your kid’s homework? The answer is the loss of integrity. Little infractions turn into huge issues over time.

But the real cost of ignoring this kind of thinking is that it keeps your organization from operating with integrity. It’s an infected strategy that derails attempts at resolving even the slightest conflicts between you and your employees. When managers believe their own sacrifices entitle them to special benefits, that belief creates feelings of entitlement among the rank and file as well. It’s infectious. Management is the primary source of entitlement thinking, and therefore, only management can transform the negative Entitlement Virus into the positive Empowerment Virus.

The Plan of Attack

To attack the virus of entitlement, take these five steps:

1. First, eliminate the ridiculous conversation that begins, “We’re like family around here.” If I had $100 for every time a CEO told me he or she tried to treat employees like family, I’d be floating on a yacht in the Caribbean. Sure, it sounds good when you say it, and it might seem like it’s desirable to create close relationships because you can make the argument that it feels good to everyone. But the fact remains that most families are somewhat dysfunctional. Why would you want that kind of behavior in your company, too?

All families tend to be patriarchal or matriarchal just by nature. So even with the best of intentions, trying to create a business culture that’s like a family ends up ultimately breeding sibling rivalry, jealousies, and resentments. And as in your family (and in mine, too), accountability is usually absent most of the time.

When employees become familiar with each other, they tend to stop holding each other accountable because nobody wants to step on friends’ or ‘siblings’ toes. Start relating to employees according to their accountability (that is, in the job they hold or the professional role they play) instead of their personality (their privileged position in the company).

The ”vice president of marketing” is an accountability; my Starbucks buddy Anastas isn’t. The big shift usually takes place when you ask employees to make real promises to take real actions and then measure how well they have kept their promises. If they don’t do the job, rather than getting upset, simply be curious. Ask, “What’s missing that kept you from keeping your word?” Then, begin working with the employee to close the performance gap by helping to provide what’s missing. Doing this one thing will cause immense change within your company.

2. Next create a structure for fulfilling promises. When employees know what your vision for your company is and how they contribute to its fulfillment, they can make meaningful promises to take actions that will make a difference on the bottom line. But that requires a different kind of conversation from you as their leader. The first thing to do is knock off all the talk about all your great ideas. Sure, you’re an entrepreneur; you’re going to have great ideas. But you don’t have to blab about them out loud, so stop talking about all the things “we’re going to do” in the future hoping to get employees excited about the future with you. Keep it to yourself, at best it’s confusing.

Focus on your core business issues and start promising the specific measurable actions you are going to take right now. Rather than talking to your employees about what you will do in the future, be an example of what you want from your employees. Managers literally stop the action when they confuse “talking about taking action” with actually taking action. They collapse the two into each other.

For example, you may hold a meeting to talk about how to solve a problem or how you’re going to get a desirable new client, but a week later, you have the same problem because no action has been taken. No one is managing and measuring the promises for taking action; they’re simply “talking about” taking action. So, get into action and hold employees accountable, and then start measuring for what you want. Those are the only things that matter.

More to Come

3. Communicate fully and tell the truth. If you are keeping secrets of any kind in your company (yes, losses, affairs, transgressions, bad behavior toward others), you are building resentment, and feelings of entitlement will emerge. Without truth, employees cannot be expected to act in ways that support your vision.

Instead, they begin to make things up, and what they make up is either not the truth or wrong 99 percent of the time. Do you want that going on in your company? When you withhold information, you teach your employees that withholding is an actual value. Most likely it’s not a value you want. Not fully communicating means you don’t trust anyone with important and sometimes embarrassing information. And if you don’t trust your employees, your employees won’t trust you.

4. Understand that alignment is a leader’s work of art. Years ago, a great coach of mine, taught me that alignment was my principal job as a leader. Nothing moves in an organization unless there is alignment with the vision and mission. Without it, there is no accountability, so no accountability means no alignment. They go hand in hand. You won’t mitigate entitlement if you’re not aligned, and you can’t align if you’re not accountable.

5. Finally, make sure all employees understand that if you can’t count on them to do what they said they’d do, you don’t need them. We hold on to some employees longer than we should. There’s no reason to keep employees who have no intention of keeping their word. But if employees aren’t keeping their word, the first place we need to look is at our relationship to our own word. If what we say and what we do don’t match, people begin to believe it’s not important for them to keep their word, either. You’ll know you have a problem in this area when you notice employees breaking agreements with clients.

When we think we don’t have to keep our word because of our position or rank, we breed the Entitlement Virus. It spreads rapidly and is hard to knock out, even with our best strategies. An entitlement mentality exists, to one degree or another, in every organization. To neutralize it requires that people be put in charge of themselves and be allowed to choose how they will perform. With those privileges come responsibility, accountability, and a purposeful alignment with the vision and mission. However, that presumes that the purpose is well communicated and well understood.

Replacing the Entitlement Virus with the Empowerment Virus

How do we empower? When employees are put in charge of themselves, are told clearly what the purpose of the company is. Or we help define their purpose within the company, when they are allowed to choose how they will perform. Also when they are told that they and their leaders will be held accountable for their actions, they become empowered.

They are responsible for their own future. That creates an Empowerment Virus that employees can transmit and replicate among themselves and that serves as the best counteragent to the Entitlement Virus. Those who won’t commit to accountability tend to self-select out when it’s clear they aren’t on the same path as everyone else.

Your only choice as a leader is to take responsibility for performance and continue to enjoy the benefits of behaving like a conscious leader—or not. Choosing not to perform as promised means you’ll have to accept the consequences of your actions. The Entitlement Virus has the power to prevent any organization from reaching its objectives. When you as the leader can grasp the notion that it begins with you and you are squarely at the source of this issue, you can examine your own conversations around entitlement.

In Summary

To summarize, when managers believe their own sacrifices entitle them to the special benefits of a privileged class, the Entitlement Virus, and feelings of entitlement will show up among your employees. Only by creating awareness of the Entitlement Virus will you be in a position to transform it into the positive ‘Empowerment Virus’ and create a truly winning company.

Dan Prosser is a Houston-based entrepreneur, and CEO of Faster Growth Strategies, LLC, who has built and sold 3 companies. He helps others build and sell their companies. He has extensively researched ‘Best Places to Work’ companies to understand why they do so exceedingly well financially. From that research, he wrote the internationally acclaimed book, ‘Thirteeners: Why Only 13 Percent of Companies Successfully Execute Their Strategy and How Yours Can Be One of Them’. Named one of the top five English language business books at the Frankfurt Book Fair.

A Serious PLIGHT of the Business Owners and Execs

In my coaching activities, I have found that there is one common issue present in virtually all of these folks that leads to what I refer to as the 3 Ps:

  • Lower Productivity
  • Lower Profit
  • Lower Peace of mind

What is this roadblock?

CONTROL – it seems that most want too much control over many aspects of their business and other affairs. Often referred to as micromanagers

Almost always, they see others performing certain tasks and their first thought is that they could do it better, faster etc.

This leads to micromanaging, a desire to control too many things. This results in

  • Poor time management – spending time on trivial matters
  • Resistance and resentment from workers who want to do it their way – that are doing their best.

The Need for Control

Unfortunately, this need for control usually carries over to other parts of their life.

They want to be the writer and director of the play that is going on in their daily lives.

But because they cannot control so many things, they lose focus and momentum. Then people resist and the results almost NEVER turn out exactly the way THEY think it should or the way THEY would do it.

Since things are not meeting their expectation, this, in turn, leads to toxic emotions like frustration, which can lead to anger and resentment.

And people DO NOT like to be controlled. Like a dog resisting when you pull their leash. And since people are one of any firm’s most important assets, you need to set the stage for them to succeed and not control them.

Breaking this habit of control is the single biggest breakthrough I have witnessed in business owners that I have coached.

After I point out this issue and the negative consequences outlined above, they are ready to get out of that rut.

They are ready to work ON the business, not IN all the details.

Like right NOW.

Time Usage

They reaffirm what they already know – they should use their time on the highest and best use instead of the minutia that comes from micromanaging – in ALL of their affairs.

But habits are hard to break, so I recommend a process that they repeat over and over until they form a new better habit of “LETTING GO”.

That process is:

  1. I ask that they commit to me and another person, to give up fighting to control people and things
  2. They come to realize that while they engage in that fight, they never or rarely win.
  3. I have them realize the value of peace of mind that comes from accepting people places and things for what they are. In most cases you cannot FIX people and have a minor influenced on other things/situations
  4. They are to carry a copy of the serenity prayer with them and when they become agitated with people or circumstances, they PAUSE and read/think about, the serenity prayer.

A good but simple example is traffic.

 Instead of tensing up and/or shouting, pause and read/think about the serenity prayer

God grant me the serenity to accept the things I cannot change;

Courage to change the things I can.

And the wisdom to know the difference

I have seen this work with many people, myself included.

Their state of calm and peace of mind is immediately apparent and rewarding to them, their coworkers, their family, and friends.

Of course, vastly improved results naturally follow from such freedom. .

Do everyone a HUGE favor, let go of the reins and let the world go around.

Note – This article was written by Howard Rambin, of the MoodyRambin Company. He is a Silver Fox Advisor and is available for consultation, advising, and mentoring.

POSITION PAPER ON NON-PROFIT ORGANIZATIONS

Most non-profit organizations’ fundraising struggled in 2020 and 2021 as the Covid 19 economic shutdown forced in-person donor and financial supporter functions to be greatly limited in size and scope or even canceled. Some organizations moved to computer-generated fund-raising events but these events were not as successful in raising money as the more face-to-face get-togethers had been. In addition, many businesses struggled financially just to get their employees paid and their doors open, thus having monies for support to charitable organizations and causes was and is simply just not there.

Further, in Houston, Texas the oil bust of 2020 caused many large companies that operate in the energy sector to limit or completely do away with charitable contributions.

Even prior to these 2020 events there had been a “Trust Crisis” developing regarding non-profit organizations. Ben Gose, a contributor to the Chronicle of Philanthropy, addressed this topic in an article he wrote that was published in the Chronicle’s January 7, 2020 newsletter. This article is very enlightening and worth reading.

fund raising

With all this being said, there were also several very emotional political causes being promoted in this time frame, and many corporations began making contributions to certain groups and causes to show their stakeholders and customers that they are good corporate citizens and are providing support to these groups and causes.

On the Foundation giving side of fundraising, the story was somewhat different in that the stock market provided many Foundations that support non-profit and charitable organizations, increases in their corpora, thus enabling them to have the funds available to make contributions; however, these Foundations are getting more requests than ever before.

Further, Foundations have refined their requirements and giving criteria such that the request process has gotten more detailed and lengthier with committees and/or staff having to evaluate requests more thoroughly and provide the Board with very specific recommendations. Most Foundations today require at a minimum that organizations seeking funding have audited financial statements, which is an added cost burden on these charitable and non-profit organizations. Most Foundations will also check with Guide Star/Candid(1) to see if the organization has filed all the necessary organizational documents, like financial statements and 990 Tax Returns with Guide Star/Candid.

NON-PROFIT ORGANIZATION RECOMMENDATIONS

Richard Hendee/Horizon Associates, Inc. has been working with and assisting non-profit organizations for years. Further, Mr. Hendee has started several non-profits and has sat on numerous non-profit organization boards. He never agrees to serve on any non-profit board if that organization doesn’t have Director and Officers (D & O) Insurance coverage. In today’s litigious environment legal action of some kind is, unfortunately, a given. Even if the organization did everything right and by the book, if a suit is brought against the organization, typically the Directors and Officers are included in the suit, and the expense of hiring an attorney to defend being right can get really costly, an expense most individuals do not want to risk their personal assets for. Having D & O insurance coverage is a must for any non-profit.

Here are some other key recommendations:

  • Run the organization just like any for-profit business would be run. Eventhough the organization has been given non-profit status by the IRS for federal income tax purposes, it is still a business.
  • Develop a well-thought-out (not wordy) Mission and Vision Statement that clearly states the organization’s purpose and future direction.
  • Create an organizational chart that includes position titles and functional areas of responsibility.
  • Identify areas that need specific levels of expertise, like legal, accounting and human resources, and contract with outside service providers to assure all the details are done correctly from the start, like the Bylaws.
  • Set-up the organization with the Secretary of State in the State the organization is located in and make sure updates are filed periodically.
  • Prepare a thorough detailed Business Plan which includes what the organization does, for whom is does it, how it will do it, who are the management team and board members and what are their levels of experience, who are the competitors, how the organization will be marketing what it does, what the organization’s strategic plan is, and the key: how the organization will be funded and what happens if there are shortfalls in the funding.
  • Develop criterial governance policies like code of ethics, conflict of interest statement, whistleblower policy, directors’ roles and responsibilities, gift giving policy, investment policy, internal controls, and record retention policy.
  • Schedule monthly and annual Board Meeting dates and times and hold these meetings using a formal Roberts Rules of Order(2) process. Agendas need to be created prior to the meetings and sent out ahead of time with any related agenda item documents in order that directors may have an opportunity to review documents prior to the meeting. Further, meeting minutes should be taken at these meetings and approved at the next Board Meeting.
  • Create working Committees like Fundraising/Development, Audit, Finance, Nominating, Executive (if needed). Make sure these Committees meet regularly, take minutes, have specific assignments, and periodically report to the Board.
  • Create a Community Advisory Board made up of key visible community leaders, key business executives, and community group leaders who all can be called upon for fundraising assistance, opening doors that may need to be opened and/or providing invaluable information and support about the communities the organization may be servicing. Try to stay away from putting political officials on Advisory Boards.
  • Assure that the organization is properly protected by carrying General Liability Insurance, Hazard Insurance if the organization has a lot of fixed assets, Workers Comp. if the organization has employees, and event riders to these policies for fundraising events like Galas, Hunting Trips, Golf Outings, Trade Show Events, etc.
  • Create budgets and fundraising goals and regularly review and measure actual results.
  • If the organization has real estate, apply with all taxing authorities for a reduced property tax schedule.
  • Hold annual board retreats to develop annual plans and a five-year strategic plan. These plans should be evaluated and adjustments made periodically especially if a major event occurs.
  • Develop a robust communication plan to keep your sponsors, supporters, stakeholders, community groups, and volunteers updated on the organization, events, and developments.
  • Establish a volunteer group that can be available to help with projects, events, manpower shortage, and the like. These volunteers need to be informed and made to feel they are a part of the organization and a valuable resource.
  • Participate in local Better Business Bureau (BBB) non-profit evaluations. Often individual gift-givers check with the BBB to see if the organization has any complaints filed with the BBB.
  • Prepare collateral materials (3) that communicate your messages and what you want others to know about your organization. You want to make sure that your message is in your words to avoid any miscommunication or key details being left out in any communication chain.
  • Develop an annual giving campaign that is geared around some important date related to your organization, like the founding date. You could always use the end of the year date, as some contributors do tax-saving contributions at that time of the year.

Horizon Associates, Inc., founder by Silver Fox Advisor, Dick Hendee, has developed this non-profit organization position paper to provide non-profit organizations some guidance and assistance as individuals set up a non-profit organization and to provide existing non-profits some directional changes or planning ideas if needed Horizon Associates, Inc. does not guarantee using any of this material will result in your organization being able to achieve any specific results.

  • (1) GuideStar/Candid is an information service specializing in reporting on U.S. nonprofit companies. In 2016, its database provided information on 2.5 million organizations. In February 2019, GuideStar merged with Foundation Center to become Candid.
  • (2) Robert’s Rules of Order is the basic handbook of operation for most clubs, organizations and other groups. So, it’s important that everyone know these basic rules! Organizations using parliamentary procedure usually follow a fixed order of business.
  • (3) Collateral material is any media material used to promote a company’s products or services. This includes everything from print materials like posters and flyers to digital content like catalogs and e-magazines. Anything you can use to communicate your company’s brand message is considered marketing collateral.
small business owners

Leaders: Setting a New Standard

Welcome to 2022. Yes, we have entered a new year. Like many of you, I have reviewed my accomplishments and plotted a course for this new trip around the sun.

As for me, I have chosen a noble task.

I want to help 10,000 business leaders and company owners become Better Bosses. Let’s start with WHY.

For a long time, there has been a saying among HR professionals. “People join companies but quit bosses.”

Have you ever felt that way? I know I have.

The individuals who get promoted into management jobs and/or start businesses rely on chance and circumstance for ways to figure out how to lead a team. Experience tells me that most fail in some way or another.

I think it’s time we seriously focus on making our bosses be accountable for better behavior.

It’s Tradition

First, let’s be real. In western commerce and so-called ‘big business’, we have this strange tradition of promoting the brightest bulb on the string to be a supervisor when a spot comes open. The logic goes something like this.

“Sally is our best producer. She would be the best one to lead this team.”

WRONG! Instead, we usually end up ruining the best producer and frustrating the team because Sally doesn’t do well leading people. (No knock on Sally. It could be a Bill or a George here too.)

In the case of the entrepreneur, this person has an idea for a product or service. So they start a company. The idea takes off. Pretty soon the owner knows they need a bigger team to keep things going. Hiring begins and the fun starts.

Like the promoted high-performer, most small business founders seldom know how to manage people.

In both cases, you can hope for a collection of positive experiences with prior bosses to model good habits, but guess what? Those folks had their own journey arriving where they were. So did you really get a good lesson?

Nature or Nurture?

Then there is another thought. In the halls of most business schools, you can find a raging debate among academicians about whether leadership is born or bred, nature vs nurture.

I’m not going to rehash the whole debate here. Instead, I will say this. I have met and worked with clients who clearly have more natural talent to be a leader. They have a sixth sense of reading people and making decisions. They are comfortable at the podium speaking to a team or a whole organization.

These individuals do shine in positions of leadership, running companies. And, like professional athletes, they get better with coaching to help them refine the natural-born skills they seem to have.

I wanted to play sports in school. But growing quickly to six feet tall before any notion of hand-eye coordination kicked in limited my future in athletics. Obviously, I was NOT a natural-born athlete. The few things I’ve tried since then, like golf or tennis, have required hard work.

On the other hand, I have worked with clients who did not start with “natural” leadership ability. Instead, they embraced the need to be a leader. They worked hard to learn concepts, principles, and values they could use to become better leaders and, hence, better bosses.

Therefore, my observation is simply this. Some people may be born to be leaders and get better with training. Others can learn to be better leaders with the right coaching, hard work, and commitment.

Back to Human Resources

I knew a global HR professional who boldly led a charge to redesign his company’s entire HR role. His premiss said, “If we trained better managers, our people problems would go away.”

While the company didn’t accept the theory outright, they did permit him to test it with a large global project he was assigned to support. The results were never empirically proven, but the overall success was positive based on exit reviews and employee feedback.

The idea is solid. Better bosses can make a difference in the way work teams view the company. More importantly, it impacts the quality and quantity of work contributed by employees.

Today’s Situation

Add to the above factors the rapidly changing world of work today in the face of COVID lockdowns, remote working, and workforce change.

Studies are beginning to emerge wherein labor pools are voicing one common theme. People are tired of toxic cultures created by bad bosses. Here are a few of these studies:

Management teams who have historically ignored employee feedback are being systemically voted out of office. No, I don’t mean literally, because there is no such vote. But symbolically, they are receiving a “no confidence” vote from people walking off the job. The “Great Resignation” it is being called.

In essence, the modern workforce is saying “Enough!”

Should You Be Surprised?

If you are in a management position, now is the time to take action. There is always time to review what you do with your team. You can make a change.

Want to be a better boss? Here are a few tips to help get the journey started.

First, disconnect from the tradition and legacy of your company’s “less than” culture. Take a serious inventory of the standards enforced by tradition. Does the culture rely on command and control leadership styles?

More specifically, does the culture rely on any aspect of interaction that serves to diminish an employee’s status? Is it customary to always talk down to the people below you by job grade?

When an employee brings bad news, are they subjected to ridicule and admonishment?

Break that chain. Treat people with respect. No one deserves to be subjected to harsh emotional lashings for trying to do their job.

Next, decide on an intentional change in the way you look at your responsibilities.

Shift your thinking. Can you do more to represent your team? Are there better ways to show your support for them?

Then, upgrade your communication ability. Are you the best communicator you can be?

Step outside your own box for a moment and get a read on the way your messaging lands. Ask for some 360 feedback about your communication style and effectiveness.

Just because you say it, doesn’t mean people get it.

Make your communication a true two-way exchange. State your issues, then ask for feedback on the spot. You can start with a simple ask from your people, “Please tell me what I said, in your own words.”

Communication is King

Also, don’t rehearse tragedies.

This is a line I picked up from the hit TV show “Blue Bloods.” It means don’t dwell on the bad stuff going on. If something fails, make a one-time review of why, learn from it, then move on. Don’t keep dredging up the negativity.

With this also, never use a team or individual fail to justify a ‘public execution.’ Good people fundamentally know if they made an error. You as the boss, don’t have to keep reminding them of it.

Finally, learn how to read the room.

Pay attention to what is going on around you. If people seem on edge about a problem that is in front of them, you have to handle the problem first. Then you can announce a new piece of guidance or instruction. You can’t teach a sailor to tie a knot when the ship is sinking.

The New Year

Turning the page on the calendar is a great way to reset your own focus. Please take a moment to think about how you manage and lead your team.

Can you be a Better Boss? We all can do something to up our leadership game. Why not join me in making 2022 the year of the Better Boss?

The Keys to Becoming a Great Leader

Now everybody knows something about leadership. 

But when I taught strategic leadership courses to MBA students at the University of Houston, in the beginning my first question to the students was “who wanted to be a leader and a great one at that?”

There was always this look of bewilderment on their faces not knowing how to answer. 

Leadership can be puzzling and seems like a lofty aspiration as many times leaders are put on a pedestal.

 Leadership does make a significant difference in the performance of an organization.

Jim Collins demonstrated that in his well-researched book Good to Great as have a boatload of others. 

Normally, when people begin to talk about leadership, they start rattling off all these characteristics.

Well, I am not going to tell you that these are the top ten characteristics of being a great leader as many articles do. 

But in my opinion that is coming from the wrong starting place.

If you begin with characteristics and try to figure out who is great, you enter into a mindset of rating one leader against another based on the characteristics they possess.

The focus is all on the leader trying to find that special one. It’s grading on the curve.  You are better than that guy, but this other bloke is better than you.

 When the conversation begins with the leader and their characteristics, it leaves out the other half of the equation.

What is really fundamental about leadership is that there are followers. There is no leadership without followers. 

You can be a great solo performer, but that is not leadership which requires more than one person. 

Think of the Other Person First

But why do people follow? 

They follow you because their needs are being fulfilled in some meaningful way.

In effect, the leader must provide a value proposition that fulfills follower’s needs as discussed in my other leadership blogs. 

This is the first key to becoming a great leader, you must start with the needs of the follower by developing a value proposition that motivates them to follow you.

That is what a company does with customers.  It provides a value proposition that cause people to buy. 

You must have a value proposition that potential followers can buy into.

What about the natural born leader? Don’t people just want to follow them naturally regardless.

Sorry, it doesn’t work that way. You shouldn’t rely on whether you got that special leadership gene. 

In fact, most serious leadership authors advocate that leadership can be learned and dismiss this great man theory from days of yore.

Develop the We Mindset

Unfortunately, we grow up being graded solely on ourselves.  It begins in grade school right on through to high school, and then on to college.  It is all about me.

When I worked for Shell, there was a lot of emphasis on the qualities the leader possessed.

I always felt under the microscope to be this superhuman leader with all these wonderful characteristics. 

I knew an awful lot about leadership theories, but it wasn’t until my later years in senior management that the second key came to light. 

A lot of my conversation had too much I.

To be a great leader you must shift your mindset from me to “we”, which is the second key to becoming a great leader.

That requires going out talking to people finding out what really drives them.

Thinking in a “we” mindset opens them up to describing their needs.  People truly love to talk about themselves.

Leadership and Planning Go Together

Leadership is not a random hit or miss process.

How do you figure out a value proposition that motivates people to follow you? This requires planning. 

What big thing have you ever accomplished without a plan?  Planning sets direction. 

Thus, the third key to leadership is planning and setting a motivating direction.

Execution is the Fourth Key

Planning by itself is not enough, even though it does set the stage. 

The plan must be executed achieving the desired results.

People follow successful performance. 

Thus, the way to measure a great leader is to look at the absolute results. 

Thus, the fourth key to becoming a great leader is to focus on results.

That is the mindset shift that makes all the difference. 

Look at the results, but what results are we talking about?

A leader has various stakeholders with different needs as set out in the first key.

Targeting these needs means forming value propositions for each key stakeholder, and since every leader has multiple stakeholders, that means multiple value propositions. 

Great results come from satisfying these different value propositions that cause your stakeholders to follow you. 

Moreover, if you judge leadership on the basis of absolute results, it’s absolutely possible for everyone to become a great leader.  

Leadership Maturity develops a Situational Style

People have different needs; situations require different leadership, and things change over time. 

There is no cookie cutter approach to being a great leader.

Thus, the fifth key is to recognize that leadership is situational depending on the world you and your followers face.

Look to Other’s Strengths

Next, you win by utilizing yours and other’s strengths.

That is what companies do with their value propositions.  They capitalize on their strengths. 

 Great leadership is all about building a winning team, where people step up with their greatest strengths.  That is the sixth key.

You build a gameplan that leverages and synergizes on these strengths.

Develop Specific Actions

Many plans fail for lack of execution as set out in the Fourth Key.

The plans must have executable components with specific actions and be constantly reviewed and revised as results dictate. 

Leadership is not about how many initiatives you can create.  It’s about how well did you deliver on your value propositions by taking well defined actions. 

Thus, the seventh key to leadership is delivering on your value propositions with specific targeted actions.  

That creates authenticity.  Doing what you say you are going to do.

Those are my seven keys to becoming a great leader.

Develop your Leadership Plan

This is a prelude to My book Develop a Leadership Plan Become a Great Leader that recognizes that your personal planning is the key catalyst for greatness.

Typically planning is done from the business perspective, at the corporate or business unit levels on what the company is going to do.

The leader needs to figure out how to integrate into these business plans with his or her leadership actions. 

Some of the leader’s value propositions to key stakeholders will be integral in the business plans. 

Other elements require the leader to formulate more specifically a leadership plan to fulfill those people’s value propositions.

In developing these leadership plans, the focus can then turn to what strengths the leader needs to develop and what fatal flaws to correct. 

That requires the leader to fully assess his/her inner profile. 

What is your leadership style?  What are your proficiencies, things you are really good at?  What are your values, beliefs, and character?  And fundamentally, what is your purpose in life? What legacy do you want to leave?

Weaving together the “outer” world of a leader’s work environment with their “inner” world of character, style, strength, and purpose s brings a practical focus to leadership development efforts.

The leader can then reflect on those aspects of the inner self that more directly impact the outer world and pursue improvement in the areas that will make a significant performance difference, and much sooner.

In doing this, the chances of becoming a great leader go up significantly because there is a targeted focus on your actions and behaviors that will make a real difference in achieving great results.

That is the whole concept that led to my book Develop a Leadership Plan Become a Great Leader. 

The quest for great results doesn’t end with one great achievement.   

It’s not one and done; it’s a marathon. 

People will follow the leader who consistently produces great results that benefit them.  And when these great results occur, that is a great leader in my book.

Character: A Learned Behavior

Ignore your character at your own leadership peril.

Over multiple decades, research studies on character and its derivate corollaries such as authentic leadership, emotional IQ, ethics and so forth find character to be core to leadership success. Many find it to be the most important leadership ingredient.  

Some authors have coined the term Character Based Leadership. In this blog I want to stick with the richness and power of the word character originating all the way back to the Greeks.

Aristotle advocated that character develops over time as one acquires habits and behaviors from parents and community, first through reward and punishment. In other words, he thought it was a learned behavior.

In my blog on the People Side of Leadership, I advocated that Character Matters, but we did not go in depth.

What then is character all about?

Trust is Key

Do not look to me to give you a precise definition of character as like many concepts there is no such consensus in the leadership literature, and I would be just adding another derivation.

One of the reasons for this difficulty is character arises from the perception of others viewing you.  That can be summed up as whether they trust you.

Where variations arise is in the behavior that you exhibit that builds the trust. There are many perspectives and qualities advocated by various authors which tells you there are challenges in building trust with others.

Chimpanzees Deception

What got me to write this blog was a shocking study on chimpanzees that I came across in none other than Lawrence Freedman’s book on Strategy A History.

He starts the evolution of strategy with a view that deception is one of the hallmarks of strategy “across time and space.” (p. 3)

He references studies on chimpanzees finding that “Deception also turned out to be a vital strategic quality.” (p. 5)

The takeaway for me is that in intelligent species, deception is used naturally to gain power over others, not surprising in a world of survival.

However, deception does not build trust.

Honesty a Learned Behavior

Deception is essentially lying. One can consider honesty largely the opposite of deception.

Honesty and its corollary integrity are almost always a part of describing character.

Whether there are aspects of honesty that are innate is secondary for building your character.

Most argue that honesty can be enhanced by repetition and imitation.

I watch my grandchildren respond to the who did it question. There is always a lot of finger pointing.  It takes repeated effort of reinforcing always tell the truth and rewarding that behavior to see progress.

Coalitions require Trust

Friedman in Strategy a History describes coalitions as another fundamental strategy across time and space.

Coalitions provide strength to combat one’s enemies which holds true even today.

Societies also flourish when there are coalitions to enable what individuals cannot do on their own. 

Forming coalitions is almost impossible without some trust.

So, there are natural incentives towards honest behavior which has been valued since ancient societies.

Obviously, there are fragilities in coalitions as circumstances change.

Societies Growing Complexity

Embedded in our culture are societal values which also form a basis for trusting the other person.

For much of man’s history, survival has been the main driving force.

In this modern world, we have stepped up a hierarchy of needs as Maslow would say.

Social and ego needs predominate bringing on more complexity in our interactions with one another.

There is not always a common agenda or perception of what is correct behavior given the diversity of backgrounds, beliefs, and needs.

On some issues such as killing another individual, society almost always condemns that behavior. However, when it comes to punishing the killer, there are a diversity of views.

And so it goes across the spectrum of social mores.

Within our society, coalitions form with strong advocacy on what is “right” or acceptable behavior proclaiming the moral high ground. It goes well beyond political ideologies.

Thus, your character is judged via different coalitions of societal values which makes it difficult for a leader on how to behave in this complexity.

For some people, your behaviors may be deemed virtuous and of strong character while others consider you entirely untrustworthy and not to be followed.

How then do you build your leadership character in today’s complex world?

Guiding Principles

I always recommend that you be open with others about what drives your behavior.  Let people know your guiding principles.  Then they know what to expect which helps build trust.

One that I advocate is “Do unto other as you would have them do unto you”, the Golden Rule.  It only makes sense that this elevates your behavior to a common ground.

I think there is also common sense in avoiding deception.  Be honest. People can count on you doing what you say you will do.

I was part of a small start-up company in which two of the partners were conniving and deceitful to myself and the other partner.  Even though I was the CEO, I got out of there as quickly as possible when the dishonesty became evident as did my other partner.  They made millions but I have no regrets as I sleep well at night being true to myself.

You need to be clear on your relations with others to help build your character. 

One of my guiding principles is I will trust you until you prove me wrong, then we part ways or find a way for you to rebuild the trust.

To establish these guiding principles, you need to know yourself, particularly your values.

When teaching Strategic Leadership to MBA students at the University of Houston, I was surprised at how many students were not able to articulate their values.  If you are flipping from one value to another, that can appear as deception to those trying to follow you.

My blog on Your Leadership Personal Profile should help you articulate what drives you along with your values and beliefs. 

Authentic Leadership

You need to be true to yourself as advocated in Authentic Leadership. For me, this line of thinking provides another perspective on building character.

The most popular book is Bill George’s Authentic Leadership: Rediscovering the Secrets of Creating Lasting Value written in 2004. You may also want to read his follow-on book with Peter Sims entitled True North Discover Your Authentic Leadership.

A shortcut is Bill George, Andrew McLean, and Nick Craig’s book on Finding Your True North A Personal Guide. This guide provides another learning vehicle for you to build a strong character.

In the guide, they provide a concise description of Authentic Leadership as follows:

“To be an authentic leader requires you to be genuine and to have a passion for your purpose, you must practice your values, lead with your heart, develop connected relationships, and have the self-discipline to get results.  You must stay on course of your True North in the face of the most severe challenges, pressures, and seductions.” (p. xxi)

Emotional IQ

It is hard for people to trust you if they can’t relate to you.

Daniel Goleman provides great insight on interpersonal relationships in his book Emotional Intelligence Why It Can Matter More Than IQ.

He says, “There is an old-fashioned word for the body of skills that emotional intelligence represents; character.” (p. 285)

I think the Oxford Dictionary sums up Emotional IQ best with “The capacity to be aware of, control, and express one’s emotions, and to handle interpersonal relationships judiciously and empathetically. Emotional intelligence is the key to both personal and professional success.”

Besides the tenets of self-awareness, self-regulation, and self-motivation, I think empathy is the key in building trusting relationships. Empathy creates a bond of respect. The relationship becomes more than just about you and your feelings.

The good news is emotional intelligence can be learned. 

There are Emotional IQ tests. If your score is low, then it will be well worth your while to put in the effort to improve it.

One way is Emotional Intelligence workshops.  Another is to work with a mentor.

Trust by Followers

The concept of character expands when coming from a leadership perspective. This is one of the reasons the definition of character in the leadership literature varies.

From my previous blogs, you know that leaders quite simply have followers.

For people to follow you, they must trust you.

Everything we have just discussed about character comes into play in forming that trust.

But they also must feel the direction is warranted and that you will be able to successfully lead them down that journey.

You saw that in Authentic Leadership that you must have the self-discipline to get results.

Follower’s trust also gets into many other dimensions of leadership including visioning, collaboration, competencies, and on and on.

For example, in Peter Rea and Alan Kolp’s book Leading with Integrity: Character Based Leadership written in 2005, they talk about the virtues of character, competence, courage, faith, justice, leadership and corporate responsibility, prudence, temperance, love, hope, and worthiness.

Bottom line, when you take an action or exhibit a behavior, ask yourself the question will my people trust me more or less?

Without the trust, your leadership is in peril.

Core vs. Edge

You might ask yourself by following my “True North” sounds like I am building rigidities in this fast-paced chaotic world?  Without my willingness to change and adapt, how can I or my company expect to be successful?

This is the key challenge every leader faces in this rapidly changing chaotic world. In my blog on leadership agility, I introduced you to the concept of core and edge developed by Lee, Hecht and Harrison. My Silver Fox Advisor colleague Doug Thorpe further developed their concepts.

Thorpe in his article Leaders: There is a new way to Understand Change eloquently describes core as “not limited to values and beliefs but has much to do with that.  Understanding your own core can help define purpose.  Core helps to understand the power of harnessing your mind’s attention and your hearts affection.”

He goes on to describe Edge. “As you face new challenges or get pushed into unfamiliar circumstances, you are walking on the Edge. The edge is where everything we don’t know lives. New ideas, new technology, new programs, business growth initiatives, all are edge things.”

So how does one manage the space between Core and Edge?

As Thorpe aptly says, “Agility is the special ability to move from core to edge and back again without losing all sense of balance or security.”

Be conscious of your space between core and edge as circumstances change; take time to develop your leadership agility.

Organizational Alignment

It is exceedingly difficult to get everyone on board on your leadership direction, especially when change is involved.

Openness, collaboration, dialogue, listening all play a role in organizational alignment.

On the Edge, there is organizational strength through diverse ideas and opinions.

However, at the company’s core, you need alignment on the company’s values and acceptable code of conduct.

Otherwise, the common trust cannot be developed to build a strong successful coalition.

Enron had the four corporate values of respect, integrity, communication, and excellence.

All decent values, but they failed to live by them.

Enron ended up as one of the biggest corporate bankruptcies in American history right here in Houston, Texas.

But more than that, they showcased what the moral failure of senior leadership can do to devastatingly impact many lives.

Your leadership character must ensure your company lives by its core values particularly in difficult times which inevitably occur.

In conclusion, a quote from Helen Keller seems apropos, although blind she had great foresight.
“Character cannot be developed in ease and quiet. Only through experience of trial and suffering can the soul be strengthened, vision cleared, ambition inspired, and success achieved.”

It will be worth your while to work to build your character and gain more trust in yourself.

Contributed by Lane Sloan, former Shell CFO and Silver Fox Advisor.

Learning Organization: Your Company’s Survival Depends on It

A colleague of mine at Royal/Dutch Shell, Arie de Geus wrote a book called The Living Company Habits for survival in a turbulent business environment.

He contended through his work that a central attribute of companies with long lives was a sensitivity to the environment with the ability to learn and adapt.  De Gues highlighted several other attributes that contribute to a long company life, which will be discussed later.

In my recent of blog on February 23, 2021 describing the world of accelerating and chaotic change, leadership agility was advocated as a competency every leader should learn.

The main purpose of this blog is to say that will not be enough for your company.  If you want your company to survive without a premature death, then you need to build a learning organization.

What are some of the attributes of a learning organization? 

My tutelage on learning organizations came from a consultant Shell used, Peter Senge, who wrote The Fifth Discipline The Art & Practice of The Learning Organization.

Senge delves into the notion of a learning disability.  A key point I want to make is that you will naturally develop this learning disability.

The Proverbial S Curve

In my opinion, living systems tend to follow the proverbial S shape curve because of their learning ability.

 A newborn entity has little knowledge and focuses outward through a structuring process of how things work or should work.  Once a foundation is set, the structuring process accelerates, and rapid learning growth occurs.

As time progresses, this learning growth slows as the focus shifts inward towards maintaining all this structure of perceptions, beliefs, values, processes, procedures, mental models and so forth.  As Senge aptly points out in his book, “Today’s problems come from yesterday’s ‘solutions’” (page 57)

Eventually, the growth and learning plateaus, that is, unless there are interventions.

As a “living” entity, what can a company do to become a learning organization to combat the natural inertia from the past?

Learning Structures

Your company must specifically build in learning structures. De Guess identified two more habits worth noting.

One is tolerance both within and outside the entity itself.  Another way of thinking about this habit is valuing diversity of thoughts.

It’s more than inclusion. The organization needs to seek out understanding of these diverse views. In this respect, the diverse views involve differences from the current modus operandi of the company.

Understanding does not imply immediate change. Many diverse views will not make sense for the company to pursue.  But an arbitrary discounting of such ideas becomes deadly in this rapidly changing world.

Secondly, de Guess describes the habit of building cohesion and identity. 

This may sound contradictory to diversity.  Quite the contrary, the persona must be built around this burning desire to learn from one another.

As Senge describes, your people need to be lifelong learners.

Thus, the concept of a learning organization needs to be built into the stated company values.

The organization needs to celebrate renewal efforts and achievements.

Learning must become fundamental to the culture.

Systems Thinking

Peter Senge advocates that systems thinking is a key discipline of learning organizations.  I clearly agree.

When I received my master’s degree in management science, systems thinking was a cornerstone, but you don’t hear as much about it today.

It is all about seeing the big picture in a wholistic way looking at the various relationships and factors that bring about your outcomes.

As entities build structures on how things work, there become a lot of parts and sub processes which bogs down learning as the focus is on the trees and not the forest.

This is not to say that continuous improvement programs should be scrapped.  They are one of the “structures” that should be imbedded in a learning organization.

The major shifts and transformations occur at the wholistic system level of a company.

Learning organizations need to imbed vehicles to periodically look at the big picture or when alarms are sounded from external sensing systems.

System audits should ask from the internal side, “What ground-breaking change could we do differently that would have a magnitude improvement on our outcomes?”

From an external perspective, system audits should look at competitors but also pace setting companies who have made major transformations.

Obviously, scanning for new technologies and how they could redesign the way your company operates is another part of a systems audit.

Then there are also major environmental events like COVID 19 that should trigger a systems audit.

Layering on a new S Shaped Curve

Another Shell consultant back in the 1990s was Ichak Adizes who taught us about corporate lifecycles.  He authored a book called CORPORATE LIFEcYcLES How and Why Corporations Die and What to Do About It.

Adizes described to us the growing and aging process a company goes through and outlined some characteristics of growing companies versus aging companies.

A couple of these characteristics really struck me.

In a growing company, “Personal success stems from taking risks” whereas in an aging company “Personal success stems from avoiding risk.” (page 87)

In a growing company, “Everything is permitted, unless expressly forbidden” whereas in an aging company “Everything is forbidden, unless expressly permitted.” (page 87)

Relating to this last point, he talked about the importance of culture with the two dimensions of flexibility and control.

At a company’s prime, flexibility and controllability are balanced.  As controllability becomes more dominant, the aging process eventually leads to death.

My big takeaway was a learning culture can expand the shape and timing of a company’s S curve through maintaining flexibility.  Today, that is called agility. It needs to be part of the organization’s fabric.

Beyond that, there are times in the life cycle when systems thinking can bring about a major transformation in the business model.

In essence, the company layers on a new S curve.  The key is to jump onto the next S wave before it is too late.

When this structural competency is developed in an organization, the life cycle can be extensively extended by having multiple layers of S curves.

Adding Learners to your Company

The last “learning structure” that I want to recommend is consciously adding learners to your company.

Bringing diversity of thought, perspective, and backgrounds as previously discussed is important for your hiring process and something you have likely already included.

My suggestion is that you carefully examine potential hires’ willingness to be tolerant of other points of view along with a strong learning desire.

You can’t build a learning culture with a preponderance of people who aren’t learners.

Many new hires will come from the Millennials (those born between the early 1980s and mid-1990s) plus some of Gen Z (those born between the mid-1990s and 2010).

Millennials Like to Learn

Fortunately, the Millennials are generally curious with an eagerness to develop new skills and learn.

They are also multi-taskers.

I remember one day when I heard a lot of noise from my Millennial daughter’s bedroom.  She had told me she had a lot of homework, so I wanted to check up on the commotion.  It was an incredible sight.

She was sitting with a laptop in her lap but typing on her desktop while watching TV with music blaring away.

When I asked her what she was doing, she answered my homework.

Beyond that, Millennials tend to excel with out of the box thinking and creative problem solving. This will be an important competency skill set in developing the next S shape curve for your company.

Many have high expectations of your company and not afraid to express their views which is what you want in a learning organization.

Gen Z Diversity

Generation Z also has some positive characteristics.

They are entrepreneurial and not surprising all about technology.

This generation has grown up in a rapidly changing world, so they are receptive to change.

You will need that attitude in your learning organization.

Fortunately, diversity of all forms is natural to them and generally not a divisive issue.

Don’t Forget Baby Boomers

Lastly, you may want to consider a baby boomer (those born between 1946 and 1964) as a mentor to help you build your learning organization.

They have many positive characteristics too including resourcefulness and being mentally focused.

As this generation deals with their Millennial sons and daughter and their grandchildren of the next Generation Alpha, their views of change continue to morph.

Now that they are in a mentor position in their careers, baby boomers can bring a lot of unbiased wisdom having seen it all evolve.

Summing it Up

The most basic need of a living system is to survive.  If you have not built-in structures that will foster a learning organization in your company, take some advice from a baby boomer—do so now before it’s too late.

Your company’s survival depends on it.

Contributed by Lane Sloan, former Shell CFO and Silver Fox Advisor.

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