Intentions and Behavior

“I don’t understand,” Sheri shook her head. “The team said they were committed to this project. They understood everything I presented at the meeting. They didn’t have any questions. I did not sense any push-back.”

“And what happened?” I asked.

“Nothing. We discussed changes they were going to make in the work process. We talked about organizing things differently. But nothing happened,” she reported.

“So, what did you learn, as a manager of this team?”

Sheri paused for a short time. Processing. “If someone says they want to get better at something, understand that their words are only intentions. Watch how they practice. Listen to the words that people say, but watch what they do. It’s the behavior that makes the difference.”
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Are Budgets Necessary?

From the Ask Tom mailbag -

Question:
We are looking at our planning scenarios for next year, and one question we have is the value of creating a budget. Doesn’t it make more sense just to print comparative reports year over year rather than spend the time to create something new?

Response:
I always go back to purpose. What is the purpose for a budget? What are the questions we ask ourselves as we look forward to next year?

  • What is our market? Size of market? (Facts or assumptions)
  • What macroeconomic factors impact our market?
  • How much of that market can we expect to earn with our product or service?
  • Is our product or service something that can impact the market (materially) different than in the past, with a disruptive technology or delivery method? Or is it a product or service with a maintenance track that will substantially see similar volume to last year?
  • Given our assumptions about our revenue levels, what is the appropriate cost structure to deliver our promises in the marketplace?
  • Does that cost structure deliver the gross and net profit levels, appropriate to the risk, and within the return on (investment, assets) that we believe appropriate?
  • Is there a disruptive (to our market) cost that we are willing to suffer that might dramatically impact our positive ability to sell or take marketshare? Like a warranty program or alternate delivery method, like air freight for a heavy product? I know it might be heavy, but the question of air freight might spark an idea.

I see budgeting as a bit of realism for our strategic decisions. The purpose of budgeting is to help us make those decisions. As a post-mortem, budgeting helps us check our assumptions (were they wrong or confirmed) and how well did we execute on the decisions we made.

When I am working on this process with a company, a quarterly shakedown on the questions (above) help us deal with reality and adjust (our assumptions, our efforts, our cost structure, our decisions). In a stable, incremental business model, year over year may be a satisfactory approach. Where the business model is seeing dramatic disruption, by economics, technology, largess competition, regulation or other factors, a zero-base approach may be appropriate.

Budgets ARE necessary as a measurement to check our assumptions and aspirations in the market.
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Why Structure?

If you read this blog for more than a few days, you figure out pretty quick that I am a structure guy. Most people can recite the bus analogy, “Get the right people in the right seats on the bus,” but what most miss is the quote that immediately follows. “If you get the right people in the right seats (organizational structure) your issues related to motivation and management largely go away.” Jim Collins said that.

Just finished Creativity, Inc, by Ed Catmull (Pixar). “We made the mistake of confusing the communication structure with the organizational structure.”

In my world, Catmull is confused about organizational structure. Your organizational structure is your communication structure. The purpose of structure is to create those necessary communication channels for feedback loops, data gathering, discussion and decision making.
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Hiring Talent Summer Camp kicks off July 7. More information here.

Test With Project Work

Hiring Talent Summer Camp starts in two weeks.
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“What could I have done differently?” Joyce asked. “I thought Phillip was the right choice. I know now, that I was wrong, but how do you make the decision on whether or not to promote someone?”

“Why did you think he was a candidate for promotion?” I asked.

“Well, he has been with us for a little over a year. He knows the ropes. He was a team leader, had the respect of his team,” Joyce replied.

“And what level of work do you think he is capable at?”

“Well, based on what we have been talking about, his current capability seems to be about four weeks or a little more, but not a lot more.”

“So, how could you find out how much more?”

“Well, he was successful at four weeks. I could have given him a task that took six weeks to complete, or eight weeks.”

“Exactly,” I pointed out. “The best way to determine performance is with project work. The problem with project work, is that, until we talked about Time Span, you had no way to determine the level of work. With Time Span, you can measure with more precision. Your job, as his Manager, becomes more precise.”

How to Measure the Level of Work

“I hope he snaps out of it, soon,” Warren shook his head. “Tyler was one of our best supervisors before he got promoted to manager?”

“How big is this new job, as a manager?” I asked.

“I didn’t really think it was that much different,” Warren lamented. “I mean he went from six people to eighteen people, but he has two supervisors under him now, each handling a team of eight people. So, he really only has the two supervisors that he has to directly work with.”

“How big is this new job?” I repeated. “How do you measure the level of work in this new role?”

Warren thought. “It does seem more complicated. He has more resources to work with, but I don’t know that I can actually measure the level of work.”

“What was the longest time span task that Tyler had, as a supervisor?”

“Well, as a supervisor, he was accountable for making sure all the production got done. He had to make sure he had enough people on the line, that we had enough raw material to work with, make sure all the machinery was available and in working order. It was a pretty big job.”

“And what was the longest lead time item on his plate?”

Warren smiled. “Oh, yes. There is this one material that we order from Indonesia. When it arrives, we outsource a special coating. The whole process takes about six months before we even bring it in-house. And we can’t run out or all of our production shuts down. Tyler had to pay specific attention to that.”

“So, we can measure the longest time span task in his old role at about six months?” I confirmed. “So, what is the longest time span task in his new role as a manager?”

How to Measure the Size of the Role?

Warren was puzzled. “I talked to Tyler three times today. He has been having difficulty ever since I promoted him to manager.”

“So, at one point, he was effective?” I asked.

“Yes, he has been with the company for several years. He was a supervisor with six people on his team. Now, he is a manager of two supervisors with a total of eighteen people on his team.”

“What do you notice about him?” I pressed.

“It seems like he is too removed from the work. I ask him what is going on and he doesn’t have an answer. Says he has to go check. I mean, he gets the daily output reports, so he should know precisely what it happening, but it’s like he is disconnected.”

“Drugs? Alcohol?” I wanted to know.

“Don’t think so, Tyler is too conscientious for that,” Warren replied.

“What do you think the problem is?”

“It’s like the job is just too big for him.”

“So, how do you measure how big the job is?”

Leading With Power

“But, I am the team leader,” Marion protested. “The company made me the manager. They gave me the authority to lead the team. But, when I look back over my shoulder, I am not certain that everyone is following.”

“So, you are the leader?” I asked, without waiting for an answer. “You believe, as the leader, that you are now vested with certain authorities?”

Marion shifted her posture. She was suddenly, not quite so sure. “Well, that’s what I understand about leadership,” she finally replied.

“Marion, let’s think about being a leader, not as a person, but as a role that has to be played. What is leadership? What are its authorities, what are its accountabilities?”

“Well, I assign tasks for people to complete. I determine what people do, or what they don’t do.”

“Anybody in power can do that,” I said. “Just because someone has the power, doesn’t mean they are a leader. Someone with power can simply be leading the team astray, screwing things up for everyone.”

Where’s the Problem?

“I don’t understand,” Abby lamented. “I have been working with the sales team for the past six months. We had an increase in sales volume almost immediately. But, after three months, sales began to trail off. I have all the data, here in front of me. The team is making the calls, following the process, but we aren’t getting the orders we expected.”

“What feedback do you get from the sales team? What are their reasons?” I asked.

“That’s the worst part, they just want to blame someone else,” Abby was mildly irritated. “They are blaming the shipping department, of all things.”

“What about the shipping department?” I pressed.

“The sales team says the shipping department isn’t doing their job according to the delivery schedules.”

“And what does the shipping department say?”

“Seems like everyone is in blame-mode. The shipping department says they can’t get orders out of the production department. And the production department is blaming everything on a machine,” Abby replied.

“Tell me about the machine.”

“It’s old and only goes so fast. Work stacks up in front of it, but we can only get so-much output, and it’s running three (8) hour shifts. We would buy another machine, but we have no place to put one and it costs $250,000.”

“Let’s look at the sales orders placed in the first couple of months of your program. What is this list of back-orders?”

“That’s what the sales people are talking about. Their sales orders turned into back orders and their back orders turned into cancelled orders. Now they can’t seem to get new orders.”

“Tell me Abby, how might you be able to connect a slow machine to orders, back-orders and cancelled orders over a six month period? Think about how one system impacts another system.”

How Supervisors Get in the Weeds

“I am looking at your training chart. I see you have periodic S-II supervisor training and periodic S-III manager training. What about your S-I production teams?” I asked.

“Well, production around here is relatively simple. I want to spend most of my training budget where I think it will have the most impact?” Riley defended.

“But I noticed that Sam, one of your supervisors, was actually working the line yesterday. How did that happen?”

“Oh, happens all the time. It’s not unusual for my supervisors to spend half their time doing production work,” Riley explained.

“Is that why the work schedule posted in the lunch room is for last week? Isn’t Sam supposed to post a 2-week look ahead so the crew knows what is coming up?” I wanted to know.

“Yeah, he is supposed to, but sometimes we get behind on our production work, and Sam can get stuff done faster and defect free, no re-work.”

“You mean your team members each have higher re-work than Sam?”

Riley was proud. “Yep, Sam is a great guy.”

“If you spent some of your training budget with your S-I production people, would their re-work come down? Would Sam be able to spend more time in his supervisory role? Every time you have disruption at the S-I production level, you will drag your S-II supervisors into the weeds. And while your S-II supervisors are in the weeds, your S-III managers have to cover your supervisors. Everyone gets dragged down a level of work. Why do you think your teams are always behind?”

Riley stopped. “I guess I have to think about training, and competence, even at the production level of work.”

Making Progress, an Inch at a Time

“I don’t get it,” Kerry said. “This time, instead of solving the problem, I asked questions, to get the team to solve the problem. They still responded just like before. They wanted me to solve the problem for them.”

“Perhaps they didn’t believe you,” I replied. “You did something new, to solve the problem. Perhaps the team didn’t take you seriously. Progress is seldom made, in leaps and bounds, because you tried something new. Progress is more likely made an inch at a time, repeating things that work. Success seldom comes by doing the right thing once. Success comes through your habits, those grooved behaviors repeated time after time.”

“So, what should I do?” Kerry baited me.

“I don’t know, what do you think?”

“I guess, next time, I will ask questions again, put the problem back on the team. I have to make it a habit.”