Management vs. leadership?

An often debated and analyzed question is the difference between the role of a manager and a leader.  I would claim that both must include portions of each, and the roles are rather a continuum than a stark division. The leader’s key role is envisioning the future and the manager’s is focusing on executing that vision, but leaders must also be able to execute, and managers to envision. It’s all about shifting emphasis, which can be good news for leadership development.

As managers are more focused on execution, and getting things done through their team members, I insist that the two core skills for a manager are always performance management and employee development. The right way to identify developmental priorities is to do a competency analysis, but I assure you, these two core competencies will be there. Performance management would include skills like goal setting, informal feedback, coaching, corrective dialogues and evaluating performance. Goal setting also means the ability to link the vision and the organizational goals to the day-to-day work of the team members. Employee development encompasses interviewing skills, career dialogues, development planning and coaching. Just having these two fundamentals covered guarantees a solid management base for execution. The other competencies vary based on organization culture and strategic priorities.

Leadership is all about change. Great leaders must be able to envision the future and articulate it with clarity so that the vision is so compelling that they can rally the troops to support the strategic moves that are critical for the organization. To be able to envision the future, they have to be comfortable with a certain level of ambiguity and willing to take calculated risks. The execution piece is still there: They must know how to manage the organization culture and its processes to guarantee that the results are met.

Whether it’s the leader or the manager, they must continuously build their functional, operational and business acumen to earn and maintain their credibility. Complexity increases as they climb the management ladder.

Many companies struggle with their middle management development. This is the twilight zone where both management and leadership skills are required. It is the testing ground on who will make it to the highest levels of leadership. Middle managers must balance both short term execution and long term change leadership priorities, while demands and complexity are increasing for them. They must get very good at the management fundamentals while starting to adapt to the higher level leadership skills.

It’s not a question of management OR leadership, it’s a question of how much of each. Which management and leadership competencies are important in your organization?

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Competencies: Your building blocks of talent

Competencies are clusters of skills, knowledge and behaviors that are required to be successful in a given job in a specific organization. In a way they are like features of a washing machine you are looking to buy – what it can do for you. But, as we are talking about human beings, competencies are more elusive to measure and compare. Competencies are also not set in stone; they can be improved over time through development. Smart companies put effort into defining what competencies they need and want, and push them through their selection process. They develop, assess and promote individuals based on their competencies. Some companies even have competency-based rewards. Organizations with less visibility into competencies are playing a guessing game with their talent.

Core competencies

Often, companies start with defining core competencies. These are qualities they seek in all employees across the board. Examples of core competencies might be collaboration, integrity or customer focus. Core competencies should align closely with the core values of the organization. It is not uncommon that core competencies are almost identical to core values. It is important to translate the core competencies into descriptions that are meaningful in the day-to-day work at any level of the hierarchy. Core competencies are the basis for evaluating culture fit.

Functional competencies

Functional competencies describe what it takes to get a job done in a specific role. A good rule of thumb is that you only want to get to the level of detail that you are willing to manage, track and enforce. Functional competencies describe the technical and functional specialties that are required for good performance in each job role. Functional competencies help determine the qualifications for a job. In some industries, competencies are guided by professional certifications and best practices.

Leadership competencies

Management development is very important for the future leadership pipeline. Most companies have specific competencies defined for their manager role. As the organization grows and the management layers increase, it is often necessary to define distinct competencies for executives, middle managers and frontline managers.

Where to start?

Competencies can be defined in many different ways. You want to use your top performers, your current culture and your future strategy as your guiding light when you start sketching the outlines of your ideal performer.  Your tools are interviews, job analysis, focus groups and assessments. When you have the right set of competencies, they will feel right: half-way between where you are today and where you want to be tomorrow.

If you need help with competencies, contact Liisa Pursiheimo-Marcks at 512-484 8263, or liisa@forteconsulting.biz .

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Want to move from B-talent to A-talent?

Let me warn you – moving from B-talent to A-talent is a bit like going on a diet. It SOUNDS easy – Eat less and exercise more – but it’s a pain to follow through. You will be more successful, if you consider it as a permanent change of lifestyle instead of an event. It’s not just going through the motions, but really starting to think differently about talent.

Set the baseline

First you have to answer the question: What does A-talent look like to you? If you don’t define this clearly, you will get what you ask for; anything. Competency definitions and clear job descriptions are the foundation of an A+ organization. Once you know what talent you need, do a thorough talent assessment. Who meets your performance, skill and culture fit standards and who doesn’t? The next hard question is this: of those who don’t meet the standards, who can be developed via training, coaching or reassignments? Brace yourself for finding some employees who may not be up to par and need to be managed out. For the rest, create a serious development plan to reach the level of performance that you aspire to.

Fill in gaps with A-talent

Most likely, your talent assessment reveals gaps that need to be filled with new talent. If you cannot fill the positions internally, it’s time to go for the top performers out in the market. This is the first test of your new hiring strategy. Using your new criteria, you only select those who meet your standards. Go for the best. This requires a competitive rewards package and an attractive employment brand. If you are still building your brand, your challenge is to be tuned into the personal priorities of the candidates you are competing for.

Make it sustainable

Once you have an existing arsenal of A-players, you can’t afford to erode it. Maintain a no-compromise selection process that brings in more top performers. Develop a performance management process that relies on frequent feedback and mature managers. Reward and promote best performers. Make sure you are market competitive. A-players are on constant lookout for more challenges. Train your managers on using developmental assignments and having career discussions. Create growth opportunities through expert and leadership pipelines.

Create a talent culture

Make talent development and high performance part of your everyday culture. People development should be a top-of-mind issue in managers’ decision making and goal setting. Mentoring, feedback and setting challenging goals should become a way of living. For A-talent it already is.

If you need help moving from B-talent to A-talent, contact Liisa Pursiheimo-Marcks at 512-484 8263, or liisa@forteconsulting.biz .

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My working definition of talent management

Believe me, there are tons of frameworks for talent management out there. Many of them are quite complicated with multiple parts and fancy words. I am going to introduce one that is a bit easier to work with and get your arms around.

Talent management starts with performance management. If you don’t know what levels of talent you have to work with, the rest of the processes will be pretty much useless. Performance management helps you identify solid performers who are the bread and butter for your company operations, star performers who will be your future leaders, and low performers you need to deal with one way or another. This part of performance management is useful for talent management purposes. (Do not forget that real performance management that drives performance happens on a daily basis and is dependent on skilled managers. Performance ratings have nothing to do with this aspect of performance management!)

Once you have visibility to your performance levels, you can turn on follow-up talent processes. Smart companies practice differentiated investment in their talent: Their best talent gets the most rewards as well as special developmental plans that can feed into the leadership and expert pipelines. Investment in strengths has the highest return. Talent management feeds into rewards planning, annual training planning and succession planning. It creates company rigor around individual development plans as well as career plans. One branch of talent management feeds into the HR process of performance improvement plans: the low performing talent will improve or will be managed out.

Let’s look at the beginning of the talent management process. For companies to have A talent, they must grow or bring A talent in. Talent management secures a robust selection process that aligns with the organization’s talent goals. Companies with a good talent culture do not compromise in their selection process just to fill an opening. They also have a comprehensive onboarding process, which is part of talent management.

To enable a well functioning talent management process, a foundation of clear competencies and metrics is needed. Competencies are based on the organization’s core values, top performer qualities, future strategies and functional requirements. As any world-class process, continuous improvement requires solid metrics for monitoring progress.

An essential part of an organization’s competitive edge comes from its culture. Talent management intentionally monitors and manages the culture, the employee engagement and the diversity of its workforce.  If you have introduced any new process or initiative, you know well that process compliance only gets so far. A true talent culture is in the fabric of how every employee and manager thinks and acts. When talent is perceived as truly the most important asset of the organization, you are starting to get where you need to be with talent management.

If you need help with talent management processes, contact Liisa Pursiheimo-Marcks at liisa@forteconsulting.biz or at 512-484 8263.

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Are you after excellence or mediocrity?

I just finished listening to a webinar on Strength-Focused Performance by Marcus Buckingham, who wrote First, Break All The Rules and many other bestselling books. Marcus shared the latest Gallup numbers on where organizations focus their development efforts in 2010. In USA, 45% of efforts are focused on developing strengths and 55% on fixing weaknesses. Interestingly, there is a great gender difference; women peak at 73% focusing on their weaknesses. Millenials also seem to be more focused on their weaknesses at 69%. While other western countries aren’t that different from U.S. companies, the Chinese have totally changed their focus in 10 years. In 2000, only 23% focused on strengths. In 2010 the trend has reversed: 73% of Chinese companies polled are focusing on strengths. The rise of entrepreneurial optimism sees that in order to gain competitive advantage, strengths are the only way to win.

When we talk about strength-focused development, it doesn’t mean that you ignore weaknesses. It’s all about allocation of resources. The return on investment on strengths is 5 to 10 times higher than on weaknesses. Strengths are areas of unlimited opportunity. Weaknesses aren’t. You only want to make a minimal investment in improving weaknesses, enough that they don’t hold your employee back. There may also be other ways to deal with the weaknesses, such as automation, delegating or minimizing the tasks that require involving the employee’s weakness. If the job requires a large amount of time using the weakness, a job match discussion may be required.

On the other hand, developing strengths is time and money well spent. Not only will the performance improve in leaps, but so will employee engagement. People love to work using their strengths. As they continue pushing the limit of their skill and learning to master the next level of challenge, they are more likely to enter Flow, the highest level of human happiness. In 2009, only 14% of employees got to play to their strengths most of the day. When organizations don’t use the talents of their employees, they are underutilizing their human capital and disengaging their strongest players.

The best managers discover the strengths and weaknesses of their team members through observation and dialogue. They appreciate the unique talents and contributions of each individual and put them to full use. They continuously challenge their employees to learn new skills and knowledge, especially in the areas of their strength. They are developing experts.

Are you developing your strengths and the strengths of your employees?

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Revving up your sales force

Revenue must go up. That is pretty much the mantra for most companies this year. Many companies have to operate with fewer sales people now. Every sales rep counts. Those who are left must be optimized to close more business. The keys to success are a consistent sales methodology, sales management, sales skills competence, functional support and company culture.

Consistent sales methodology speeds things up

There are many top providers selling proven off-the-shelf methods on solution selling, opportunity management and key account management, or you can develop your own. Pick your religion. It really doesn’t matter which one, as long as you stick with it. Not many companies do. Consistent sales methodology creates a common language, speed of execution and baseline performance through the whole sales organization.

Sales management and healthy pipeline

Define the sales manager role clearly. A good sales manager is not a top producer who got promoted just because. The best sales managers are coaches who hold their teams accountable to developing all stages of their pipelines and prevent sales forecast surprises. These sales managers look beyond the hottest close, and challenge their teams on the status of their opportunities in the pipeline.

Sales skills competence

Companies that sell solutions depend on an increasingly sophisticated sales force. Not only do they need deep technical expertise, they also need  consultative selling skills. Add solid sales methodology on top of that. To add value to the customer, the sales person must have solid knowledge of the industry, and deep business acumen to truly relate to the customer’s business issues. These competencies are not developed overnight but require a concentrated effort. Many companies differentiate between ‘hunters’, who go after new business, and ‘farmers’ who nurture existing accounts. These jobs usually require different personal traits that can best be determined through assessments in the selection process.

Functional support for targeted customer face time

To truly shorten the sales cycle and provide support to the sales force, it should be designed together with marketing. The sales cycle should mirror the decision making process of the profiled customer. Marketing provides information about the customer profile, what the ideal customer type is to go after, and what the best communications are for each stage of the sales cycle. Marketing provides the talking points that resonate with the customer – not the list of features, but their pain points and the value of the solution.

At the same time, the organization must do everything in its power to unburden the field sales from administrative tasks. The more customer interaction time they have, the more revenue there will be. Every unnecessary report or meeting takes away from customer face time.

Customer focused culture

How the sales force is treated may be a good indicator of how customer focused the organization really is. The sales force is the conduit for the customer’s voice. If they don’t have an easy way to give input for new product ideas they heard from the customer, the customer voice gets drowned. If they are not the number one priority when trying to resolve customer issues or request, it does tell something about the company’s overall priorities.

2010 is the turning point. Prepare your sales force to go out there and take some market share.

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Copyright 2010 Liisa Pursiheimo-Marcks, all rights reserved. SVPGMGDX8TEC

How to get a raise

2009 was a year we want to forget. Adjusted for inflation, total compensation in the USA fell by almost 1.3 percent. 2010 looks a bit better, but not much: a salary increase forecast conducted by The Conference Board projects modest budgets of 2.8%, barely enough to match the inflation rate. In this environment, what can you do to get that coveted raise? There are no silver bullets, but the answer lies in knowing the process, studying the criteria and applying self awareness.

There are different approaches to compensation strategies in organizations, such as flat inflation adjustments, seniority systems, competency based increases, but performance based pay is the king. It makes sense; the best performers get the best compensation. In this year’s case, the performance based companies will take their 2.8% increase budget and try to divide it so that low performers will get nothing, solid performers will get a little bit, so that there is some extra money accumulated to give a more handsome reward for the star performers. It sounds straightforward, but many complain that they are not being evaluated fairly. Herein lies the challenge: 90% of employees feel that their performance is above average. So, how do you know if you REALLY are above average and deserve the key to the treasure chest?

If your company is in a mature stage, it has clearly defined standards for different performance levels. These would describe how a top performer behaves versus a solid performer, and what constitutes performance below expectations. Sometimes, you can dig in further and find the listed company leadership values. If you can’t find any published criteria, here are some generic tips how to distinguish whether you are a true top performer vs. a solid performer:

• Top performers are part of a solution. It’s not that they don’t see problems or are yes-men. When they see a problem, instead of just identifying the issue, they think of possible solutions and volunteer to be involved in implementing them.
• Top performers are proactive. Instead of just doing a good job at fulfilling requests and completing goals, top performers clearly see the overall strategy and purpose of the company, and jump at opportunities to do things beyond their current tasks, as long as they are aligned with the current priorities.
• Top performers are change agents. In new initiatives, top performers not only go to training and follow the new rules, they embrace the change vision and evangelize the cause. If there are issues, they find workarounds instead of just pointing them out.
• Top performers are continuous learners. They ask for feedback and act on it. When they go to training, they are engaged. When they get back to work, they share what they learned with the team and apply the new skills on the job.

Just as a word of caution, here’s a tell-tale sign how to recognize if you might be a low performer: you consume a lot of your supervisor’s or HR’s time. Unless your time with your manager is proposing ideas that you are volunteering to implement, you are taking time away from productivity. The only other exception may be if you are reporting illegal or unethical activities; that is your right.

Get savvy about your company’s performance management and compensation processes. Know the criteria for decisions. Find out about the schedule and decision points. For example, once the merit increases have been approved by senior management, your chances of changing your manager’s decision are slim. Your manager and HR are your best sources of information. Use the processes to your advantage and don’t be afraid of them. Document your performance throughout the year and make sure that your manager, the next level management and HR are aware of your accomplishments. Network internally so that the decision makers can connect a name to a face.

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If you are a manager, don’t let the rewards planning time to go to waste. With the little budget that you have, make it count:

• Make sure there are no surprises. Your performers should know where they stand based on the informal feedback you give throughout the year.
• Be as transparent as you can be about the guidelines and how the compensation decisions are made. Clear expectations upfront set the stage for frank discussions.
• Make sure to celebrate the successes with your top performers and show how much you value them. The reward dialogue with them is a great opportunity to do so.
• Don’t forget to share how much you value your solid performers. Show them what it takes to be a top performer.
• Don’t cop out with your low performers. They should not be surprised with what’s in store for them.
• Don’t forget that compensation can only be a dissatisfier. Leading with purpose, giving feedback and developing your employees ultimately drive their engagement.

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Copyright 2010 Liisa Pursiheimo-Marcks, all rights reserved.
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