Author Archives: Tom Foster

About Tom Foster

Tom Foster spends most of his time talking with managers and business owners. The conversations are about business lives and personal lives, goals, objectives and measuring performance. In short, transforming groups of people into teams working together. Sometimes we make great strides understanding this management stuff, other times it’s measured in very short inches. But in all of this conversation, there are things that we learn. This blog is that part of the conversation I can share. Often, the names are changed to protect the guilty, but this is real life inside of real companies.

Contrived System of Reward

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“But the worst part of my little bonus system,” Reggie confided, “was not that my managers manipulated the numbers, but that the system I created changed the mindset. I corrupted their thinking. Digging out of that hole is going to take time. And some of them will not survive. I created a contrived system to reward something I thought was good.

“And the winner of my little contest, the successful candidate who gets the position as the new division VP, is going to think he got the job by gaming the system. It doesn’t matter how I explain it, in his heart, his experience will tell him that he got the job by playing with the numbers.

“It is really true,” Reggie continued, “the behavior you reinforce, is the behavior you get. I created the incentive. I got the behavior.”

“If you are going to create a different environment, what has to change first?” I asked.

“All crumbs lead to the top,” Reggie said. “I have to change first.”

Competition and Manipulation

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“So, you’re the culprit,” I repeated. “What specifically did you do that was so counterproductive?”

“I remember, it wasn’t anything extreme. We have different sales channels and different product lines, with outside sales, inside sales, internet sales. I began to hand out bonuses for each department with the highest gross margin, another for the highest revenue in the quarter.

“It’s funny, now that I think about it, when I handed out those bonuses, the room was quiet. There was no jubilation or high-fives, just a nod and a polite thank you.”

“Tell me about the down-side?” I asked.

“I found out later,” Reggie explained, “that each department gamed the gross margins. They would pump up the pricing in the last week of the quarter and then rebate it back to the customer in the next quarter. In the end, we still got our standard margin, but each department manipulated the bonus system. And all the progress we made on cross-selling was lost.

“And it’s not so much that they had to pay the piper in the next quarter, but look at all the wasted energy, counterproductive to what we stand for. And the last thing on our mind was doing a good job for the customer.”

The Danger of Healthy Competition

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“It was worse than I thought,” Reggie stated flatly. “What I didn’t realize when I opened up this little fracas, was that the competition started long ago. I nosed around some of my sources. It’s been a dysfunctional fight for the past six months, with not only my three internal candidates, but two others. They are all spread across three departments, so I never saw it.”

“What’s been going on?” I asked.

“Mostly, it’s the subtle non-cooperation of one department with another. Convenient delays, rough hand-offs, missing information. Nothing malicious or brazen, but I have five people working against each other, working against the company.”

“Who’s the culprit?”

Reggie’s demeanor changed. He sat straight up in his chair. The nerve was struck. Chin down, looking over his glasses, furrowed brow, he finally spoke. “I’m the culprit. I tried to create a little healthy competition, but what I created was an environment where individual agendas were more important that teamwork. I created intense internal focus within each department, when I need cooperation between departments.”

“How do we fix it?”

“First, we have to start with the culprit,” Reggie shrugged. “And that would be me.”

Dilemma with Internal Candidates

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Reggie was grinning like a Cheshire cat. “I’m really lucky,” he said. “We are opening up a new division and I have three great candidates for the VP position. It’s actually going to be tough to pick which one I like the best.”

“Congratulations,” I offered. “Internal candidates or external candidates?”

“All internal. Homegrown. Got the right value system. Good decision-making skills.”

“And what will happen to the two candidates left behind?” I asked.

Reggie stopped. He was focused on his good fortune to have this kind of bench strength, but he had not considered what would happen after his selection.

“I guess they will just continue doing what they are doing now. I mean, they all play an important role, they just won’t be a Vice President in charge of a division.”

“They all know they are being considered as a viable candidate for the position?”

“Yep, I had a meeting, just last week, with all three of them. I wanted to be upfront, let them know what I was thinking.”

“And, have you noticed any change since you had that meeting?”

Again, Reggie stopped. He knew I hadn’t dropped by to chat about the weather. He also knew that sometimes, even on the outside, I hear about trouble before he does.

“So, something is up?” he guessed.

I nodded. “Don’t go jumping in there, but take some time to take a hard look at the new dynamics you just created.”

Someone in the Wrong Role, How to Reassign

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“But he has been doing a terrible job, as a Manager,” Cheryl observed.

“So, do you want him out of the company? Should he be gone?” I asked.

Cheryl shook her head. “No, Harold has too much knowledge, he knows everything about everything, he is just in the wrong position for our company. What he is doing now, works against us. But he could be so valuable in a different role.”

“Right now, you have Harold in the role as a Senior Manager, which you say is the wrong place for him. But you don’t want to fire him, just reassign him. How do you think that will work, in Harold’s eyes?”

“He’s not going to like it,” Cheryl replied, still shaking her head. “He might quit and we really do need his technical knowledge. I am afraid he is going to be embarrassed in front of his peers, in front of his direct reports. This move is going to be very touch and go.”

“So, what is the one thing you have to do, to make this move successful?” I pressed.

“Somehow, we have to allow Harold to save face in front of the company. I am just not sure how to do that.”

Malicious Water Cooler Talk

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From the Ask Tom mailbag –

Question:
I was recently hired in to a new organization as a manager. It is evident that one of my team members was passed over for the role. He has been here for ten years and contributes well in his current role, but I can see why he was passed over. Unfortunately, the rest of the team doesn’t see it that way and I am getting stone-walled. He is also well-liked by a couple of board members, so I am getting squeezed on both sides.

As I look at the staff, there is complacency, some have been coasting for years. The company invested in some new software a year ago and still no one is using it. It’s the software we used at my old company, so I know it works well. That’s why I was hired.

The team’s behavior is passive-aggressive. I get agreement in meetings and excuses on the back end.

  • Just too busy this week.
  • Not sure how the software works.
  • Our old system is better.
  • Easier to do it the old way.

At the end of the day, I will be held accountable if we can’t get this new software integrated into our routine. The water-cooler talk is malicious. I don’t have a single friend in the bunch.

Response:
Someone made a decision to hire you. And my guess is, unless you make some progress, that same someone will also fire you. But, for now, they are in your corner. That is where I am going to hang my hat.

You are the manager of the team, but you also have a manager. Your manager is your coach. Schedule regular meetings and play this straight. You have a job to do and you need solid counsel. But, do NOT go in empty-handed.

You are new, and in the beginning, you should be in high data gathering and diagnosis mode. You have been given an objective, get the new software going and people using it. What’s your plan? How long will it take? Is the software installed and configured? Is there training available or are you on your own with help files and manuals? What are your short term milestones, medium term milestones and long term milestones? This is stuff for you to review with your coach.

You have been given a team. What is your assessment of your team? You have talked to them and worked beside them for a couple of weeks. What are your observations about their capabilities, skill levels, interest and value for the work? This is stuff to review with your coach.

You need some small wins, and they might have nothing to do with the software. You need to get to know your team. What attracted them to the company? How long have they been there? Best part of their job? What gives them juice? What challenges them? Gather data. Your team will tell you how they work best together. When was the last time the team faced a real challenge? How did they approach it? What problems did they have to solve? What decisions did they have to make? I know you feel like this software is your project, but it is really the team’s project. This is more stuff for you to review with your coach.

Then work your plan. My guess is that no one has taken this team to a new place in quite a while. This can be a challenging journey or the team can stiff-arm you until you quit.

Skills Training, Necessary but Not Sufficient

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“Look at this,” Phil exclaimed. “We just had the training on this last week. And I just pulled samples from the prototypes. Thank goodness this isn’t a production run. I ought to fire the whole lot of them.”

I winced. “Yes, I guess you could fire them, all eight of them. But then you would have to run the line yourself. I don’t know if you could keep up.”

“You know what I mean. I’m not going to fire anybody. I’m just frustrated. Maybe it’s our training department. Maybe we need to look at the training program.”

“Perhaps,” I said. “You know, when people acquire a skill, I mean really acquire a skill, it takes more than a training program.” Phil looked at me, like I was from Mars.

“When you were a kid, did you ever learn how to throw a ball?” I continued. Phil nodded. “So, someone showed you how to throw, and you threw one ball and then you were an expert?”

Phil laughed. He suddenly knew where I was going with this. “Of course not. I had to throw a hundred balls. I had to practice. My mom was my coach.”

“So, what do you think is missing from your training program?”

Phil’s eyes narrowed. His head began to nod. “Practice and coaching.” And with that, he scooped up the samples, turned on a dime and headed for the production floor.

Could Have Been Fired

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“So, you were surprised that you didn’t get fired?” I asked. Kim and I were talking about her near disaster with a forklift.

“I was certain I would get fired. It was a boneheaded move on my part. But my manager used it as leverage. He knew he had my undivided attention over the forklift. He also knew that I was motivated to make things right. So he got someone (me) to run the safety program, where it benefited the most.” Kim replied.

“How did that bring value to your thinking and your work?”

“Well, he could have fired me, he could have yelled at me. He could have embarrassed me in front of the team. He could have called me out to his boss. He could have suspended me. But what he did was to make me think.

“He had me motivated to sit down and learn more about how serious this safety stuff really is. It was one of the most important lessons in leadership that I ever learned.”

Learning From Mistakes

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A good bit of the morning had passed when I met Kim in the coffee room.

“Okay, I came up with a list,” she said. “It’s not a long list, but I was able to think about some specific things that were helpful to me when I was a supervisor. It’s funny. At the time, I didn’t realize how helpful it was, but now, I can see it clearly.”

“So, what’s the biggest thing on the list?”

“We were under some pressure to get a big order pulled for shipping. I was supervising the crew. Things were hectic. I commandeered a forklift that had been pulled out of service. One of the buckles on its safety harness was being repaired. I was thinking, how stupid, not to use a forklift for a few minutes just because it didn’t have a safety harness.

“Big mistake. I told one of my crew to use it anyway, just to move some product about ten feet over in the staging area. That part was okay, but when I wasn’t looking, the crew member took the forklift over and started moving other stuff. He figured it was okay to use the machine, since I said so. He was turning a corner and ran over something, his load shifted and he came right out of the machine.

“I was lucky. No one was hurt, nothing got damaged. In fact, everyone that was there, thought it was funny. Well, except for my manager. I thought I was going to get fired. It was a stupid thing I did.”

“So, what did your manager do?”

“He never yelled at me. I remember, he just came into my office that afternoon. He said one word, ‘Lucky!’ Then, he put some safety books on my desk, said he would be very interested to attend my safety meetings for the next three months.”

“So, tell me, how did that bring value to your thinking and your work?”