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.

Low Risk Failures

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Second in a series with Victor Cheng, a San Francisco based business coach, and author of the Recession Proof Business.

Tom:
In an attempt to scratch out precious points in market share, what changes should companies design into their operating strategies?

Victor:
One pattern I’ve seen in the company’s I’ve worked with is that often the easiest market share gains are made in secondary market segments. Assume a business consists of Product lines A, B, and C or customer segments A, B, or C, where A is the largest revenue producing segment, and C is the smallest one.

In a number of cases, I’ve found the easiest way to grow a business and expand sure is in segment C. This is not to say that one should always look at the smallest segment for the most growth. However, I’ve seen this pattern of the “neglected”, smaller segment can sometimes have a counter-cyclical demand and less competitive aspect to it.

So, don’t just look at the biggest parts of your business. Examine the smaller slices too.

Finally, from an operations standpoint, the big thematic change that needs to be made is the willingness to experiment with growth options. If you’re not deliberately willing to seek out and tolerate many low-risk “failures”, it’s highly unlikely you’ll stumble upon the pockets of demand that always emerge in major structural shifts in demand such as the one we’re experiencing now.

You can download a free e-copy of Victor’s book, The Recession-Proof Business. Our conversation continues tomorrow.

Your Customer Ain’t Coming Back

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I spent some time with Victor Cheng, a San Francisco based business coach, and author of the Recession Proof Business: Lessons from the Greatest Recession Success Stories of All Time. It was an interesting conversation.

Tom:
As we make this slow turn from recession to recovery, what are the biggest mistakes companies make attempting to re-engage their old markets, the ones, by necessity, they have contracted away from?

Victor:
This big mistake is assuming that what used to work pre-recession will work post-recession. The magnitude, severity, and duration of this recession has been significant. It’s my view that the contraction was not merely a correction to an otherwise robust growth trajectory, but rather a structural shift in demand.

The problem with structural shifts in demand is they tend to have far reaching cascade effects that are difficult to spot in advance, and only obvious in hindsight. If a company’s clients have gone away, it’s not a given they may come back. If one product line is no longer relevant in this new economy, it’s quite possible a different product line is now more relevant.

One has to be looking qualitatively and quantitatively for these shifts. The early “clues” that reveal these trends are often either passing remarks clients make about their situation, that foreshadow shifts in spending or unusual shifts in revenue mix across products, services, or customer segments.

It is difficult to reliably extrapolate these small early signs to find the longer term trend, but those who are willing to tolerate getting it wrong sometimes, will have a major first mover advantage to capitalizing on how a re-structured customer demand is expressing itself in the new economy.

You can download a free e-copy of Victor’s book, The Recession-Proof Business. Our conversation continues tomorrow.

Connecting to Our Own Self-Interest

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“Speak in terms of the other person’s interests.” Those words rattled around in Susan’s head for a minute. Finally she spoke.

“But, you know, sometimes, there is stuff that I need to communicate. Sometimes there is stuff that is in my interest, or the company’s interest. What do I do then? I mean, it’s all well and good to talk about the other person’s interests, but what about me, what about the company?”

“Susan, you make it sound like your team doesn’t have you or the company at heart. In fact, they do. Let’s take the issue of efficiency. It is in your best interest as the manager and in the company’s best interest for your team to work efficiently, right?”

“Exactly,” Susan replied, moving to the edge of her chair. “I want to talk about efficiency, so how do I talk in terms of the other person’s interests when I want to have a discussion about efficiency?”

“First, Susan, understand that your team also wants to be efficient. Believe it or not, your team wants to be productive and do a good job. They want to do a good job for you and the company. And it is your responsibility, as the manager, to make that connection.

“Gather your team together. Divide them in workgroups of two or three people and tell them the topic for the day is efficiency.

“Today’s topic for discussion is efficiency. But before we talk about how we can be more efficient, let’s talk about why. For the next one minute, work in your teams and write down three benefits that happen when we work more efficiently. The benefits you think about, should be personal benefits to you. You spend 8 hours a day working here and you work hard. What are the personal benefits to you when the team works more efficiently?”

Susan looked at me, then pulled out a sheet of paper. “Let me write that down,” she said.

They Don’t Want to Listen

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“But, what if my team just doesn’t want to listen to me?” Susan protested.

“And, how does that make you, as the manager, less responsible for the communication?” I asked.

“Yeah, but, if they don’t want to listen, how can I make them listen?”

“Indeed, how can you make them listen?”

Susan stopped, this wasn’t going anywhere. “I can’t make them listen. If they don’t want to listen, I have to figure out how to get them to want to listen.”

“That’s a start. Remember, as the manager, you are 100 percent responsible for the communication. So, how do you get them to listen in the first place?”

“Well, I guess I have to talk about things they are interested in. I have to get their attention.”

“And since you are 100 percent responsible for the communication, that is exactly where you should start. Speak in terms of the other person’s interests.”

Not a Lot of Listening

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“The biggest difficulty we have,” Susan insisted, “is communication.”

I nodded. “How so?”

“Well, sometimes it seems we are not even on the same team. I give instructions, I hold meetings, but when somebody has to coordinate with someone else, it always seems like the ball gets dropped.”

“What do you think the problem is?” I asked.

“It seems that there is an awful lot of talking going on, but not a lot of listening.”

“And that surprises you?” I smiled.

“No. But, as the manager, I expect my team to listen when I talk.” Susan shook her head from side to side, impatiently.

“Oh, so this is your team’s fault?”

Susan was no dummy. She sensed I was setting her up. “Well, okay, I know I am 50 percent to blame,” she relented.

“And what would you do differently, if I told you that you were 100 percent responsible. For your team’s complete understanding, you, as the manager, are 100 percent responsible for the success of the communication. What would you do differently?”

Execution Trumps a Promise

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Curtis shook his head as he paced around his office. He wasn’t angry, just awestruck. “Five contracts,” he said, “We lost five contracts to those bozos, in the past two months.”

“What do they do, that you don’t do?” I asked.

“Nothing, that’s what gets me. We run circles around them with what we can do. We spent a $100,000 on a machine last year that does all kinds of stuff they can’t do.”

“What did the last client say?”

“I don’t understand it, the last client said that it was nothing special, that they just deliver a plain vanilla product. When they need it, it’s there.”

“And what’s the backlog on your delivery?” I prompted.

“Well, we are a few days out on our delivery, but look at our quality, it’s so much better,” replied Curtis.

Execution trumps a promise every time. Execution of a plain vanilla product on-time trumps late-delivery of a special product, every time.

No Magic Pill

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There is no Magic Pill.

Interesting response to the Magic Pill post last week. A story to make you think, about effectiveness, work-life balance, and the way you approach your role in your organization.

There is no Magic Pill.

Here is the reality. A manager has responsibility 24 hours a day, seven days a week, 365 days a year. Your goals are not minute by minute, hour by hour. You don’t have a shift that ends.

This understanding was not lost on the Oakland Police Department. They measure effectiveness in crime statistics. Their organizational structure was oriented around distinct eight hour shifts and they experienced predictable communication and handoff issues.

Using Elliott Jaques principles in Requisite Organization, “the police department laid out smaller-than-usual precinct-like neighborhood boundaries in the southern third of the city (the area known as East Oakland), with a lieutenant accountable for all police activity in each neighborhood 24 hours a day, instead of one 8-hour shift (as is typical elsewhere). Recorded crime levels in that area rapidly dropped 25 percent.”

Of course, the lieutenant was not in uniform, at HQ 24 hours a day. It’s a different way of seeing the world, understanding that crime does not work in neat 8 hour shifts, and that crime reduction requires a 24 hour orientation.

What are you accountable for, as a manager? How do you become more effective, understanding that you have 24 hour accountability for your goals?

There is no Magic Pill.

Oakland Police Department Case Study.

Magic Pill

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Prescription Instructions

  1. The magic pill must be taken, by managers, once per week, on Monday.
  2. The magic pill has no effect on the manager during the week until 40 work hours have been logged.
  3. Once 40 work hours have been logged, the magic pill prevents the manager from thinking about work activities.
  4. Blackberries and remote email are considered work activities by the magic pill.
  5. If the manager persists in thinking about work activities, the magic pill will shut down conscious thought and make the subject sleep for a temporary period (naptime).
  6. In most cases, the magic pill has been shown to change the work habits of managers, who now know they must be effective within 40 work hours per week.
  7. In clinical trials, in some cases, side effects of the magic pill have improved family and social activities.

Think about this magic pill. If you took the magic pill, what habits would you change to become more effective?

Wasted Time, Effective Time

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“I know planning is important, but I have so much to do today,” Lauren explained, hoping I would let her off the hook.

I nodded my head. “I know you have a lot to do, today. How much of what you do today will be effective?” I asked.

“What do you mean? I have phone calls to return, emails to answer, meetings to go to. I have a couple of employees I have to speak to about things they were supposed to take care. I have two projects that are behind schedule. A lot of things piled up over the past week.”

“How much of what you do today will be effective?” I repeated.

“Well.” Lauren stopped. “I know some things are more important than other things.”

“And, how do you make that decision? How do you know what you do is effective? How do you know what you do is important?” Lauren’s posture shifted. She backed off the table between us. She was listening. “I will venture that 80 percent of what you do today will be wasted time and only 20 percent of what you do will be effective. How will you know you are working on the 20 percent?”

Your ASAP is Not My ASAP

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“Last week, you assigned this task to Dale, but you ended up doing it,” I observed. I could tell Sondra was very pleased with the project result, but miffed that she spent the weekend working when Dale had all of last week to work on it.

“I thought about, what you said, being more explicit about my deadline. Next time, I will try to remember that,” Sondra replied.

“More than that, the target completion time is essential to the task assignment. Dale gets all kinds of assignments. To complete them, he has to use his own discretion, primarily about pace and quality. Most of the decisions he makes are about pace and quality. Without a target completion time, he has no frame of reference in which to make his decisions. His ASAP will ALWAYS be different than your ASAP. ASAP is not a target completion time.”

Sondra smiled. I took a look at her project. It was really very good. She will make her client meeting today and life will go on.