Archives for May 2021

(Ed Note: This article first appeared in Forbes, for whom George is a regular contributor. He is also an alumnus of Coca Cola where he formed a deep respect for CEO Neville Isdell and his leadership ability. George looks back on those qualities here)

If decisions have to go through you, you’re the choke point at the bottom of the funnel, controlling the flow. 

Conversely, if you provide clear direction, resources, bounded authority, and accountability, enabling others to make decisions, you turn the funnel into a megaphone, amplifying your influence and impact. It’s one of the fundamental differences between early-stage entrepreneurs and successful leaders of larger, more complex enterprises.

Coca-Cola’s Neville Isdell was a decision-enabler. As described in The Keys To Level Four Delegation, Neville led by giving people:

1. Direction as to the desired objectives and results so everyone understood his intent.
2. Resources – The human, financial, technical, and operational resources they needed to succeed.
3. Bounded Authority to make tactical decisions within the strategic boundaries and guidelines all had agreed to.
4. Accountability – Standards of performance, time expectations, positive and negative consequences of success and failure for those held to account.

It’s counter-intuitive, but clear direction, boundaries and guidelines free people up to act. Knowing what you can’t do lets you spend more time thinking about what you can do.

Coca-Cola’s people knew they couldn’t mess with the core pillars of Coca-Cola. No-one tried to change the secret formula. (Except once with New Coke. But that’s a different story.) Global package changes were big deals. But people had tremendous flexibility with local advertising, promotions, and execution, enabling the tactical capacity to adjust quickly and decisively.

Isdell deliberately spent more time enabling others’ decisions than in making decisions himself.

Steps You Can Take

Direction

Start by aligning people, plans, and practices around a shared purpose. Your shared purpose is a combination of your mission (why,) vision (what,) and values and guiding principles (how.) One of the most important guiding principles goes to the core nature of the enterprise: design, produce, deliver, or service.

Core Framework

Your overarching strategy and strategic priorities flow from this, directing each group within the organization to:

• win by being predominant, superior, or strong,
• not lose by being above average, or good enough/scaled, or
• not do or out-source.

This gives them a clear picture of their desired objectives, results, and interdependencies with other groups so everyone understands your intent.

Resources

Strategic and priority choices are theoretically elegant and practically useless until they have resources behind them. Make human, financial, technical and operational resource choices in line with each group’s priority:

• Predominance requires top 1% resources to be the ones shaping the future.
• Superiority requires top 10% resources to be better than anyone else.
• Strong requires top 25% resources to be better than most.
• Above Average requires competitive resources to be generally competitive.
• Good Enough/Scaled is where you save money to fund higher-priority areas, looking only for the minimally viable approach and ways to scale efficiently.
• Not Do or Outsourced may or may not save you cash immediately, but it keeps these areas from distracting leadership.

Bounded Authority

This was where Isdell excelled. When his people made tactical decisions within the agreed strategic boundaries, he was always supportive. They knew they had the authority to make those decisions. Anytime anyone needed to re-look at a strategic boundary, they knew they had to engage with Isdell – who was always open to people influencing decisions he had the authority to make.

Accountability and Consequences

Pick your cliché. “If it doesn’t get measured, it doesn’t get done.” “You get what you inspect.” You’ve probably got your own favorite. The point is you have to measure, track, and assess results so you can adjust.

Set clear standards of performance, time expectations with milestones along the way, and positive and negative consequences of success and failure for the people being called to account. And then follow through.

Planning Process

1. Confirm the shared purpose: mission, vision, values and guiding principles including the nature of the enterprise.
2. Make clear strategic and priority choices in line with that.
3. Deploy resources in line with those strategic priority choices.
4. Clarify the tactical decisions leaders can make on their own and which they need others to endorse.
5. Require those leaders to share and implement rigorous plans to deliver their priorities so all know what’s getting done by when, by whom, with what resources and what interdependencies.
6. In general, track, assess, and modify your overall strategic, organizational and operational processes annually, overall business results quarterly, programs monthly, projects weekly, tasks daily or more frequently in a crisis.

Many companies fail to pay adequate attention to their leadership pipelines and succession planning.

Earlier this month, a study published in the Harvard Business Review came to an astonishing conclusion: the market value wiped out by badly managed CEO and C-suite transitions in the S&P 1500 alone is close to $1 trillion a year.

It is not just large companies at fault.  In the same study, an alarming 69% of private companies in the Middle East did not have a CEO succession contingency plan in place. In the research it was estimated that better succession planning could help market valuations and investor returns to be 20% to 25% higher.

Developing a comprehensive succession planning process for critical roles is key to strengthening your organization’s business continuity.

The authors of the HBR study concluded that an excessive tendency by large companies to hire leaders from outside is one of the biggest problems with succession practices.

This incurs three major kinds of costs: underperformance at companies that hire ill-suited external CEOs, the loss of intellectual capital in the C-suites of the organizations that executives leave behind, and for those companies promoting from within, the lower performance of ill-prepared successors.

The benefit of a succession plan is that your organization will not be caught off guard, even if a top leader leaves to join a competitor or faces personal or health issues or even retires. 

We have observed three key success factors for a vigorous Succession Planning Process

• Effective identification of high potential talents internally for every critical leadership role.
• Robust development and coaching program into preparing those talents to assume the relevant senior role.
• Assessment of those finalist talents at the end of a succession planning program on how they stack up against external top talent.

A Planning Template

Here is how to design an effective Succession Planning Process

1. Design – Decide which roles are critical in designing a succession planning process.
2. Redefine – Interview top leadership and redefine critical role requirements (decide key skills, competencies & traits for each critical role).
3. Identify – Identify High Potential (HiPo) talent internally for each critical role.
4. Develop – Develop technical & behavioral capabilities for the finalist HiPo talents over a pre-agreed time period (period length according to seniority of positions). 
5. Assess – Formal Assessment of the finalists of each critical role following their nurturing period, against job requirements.
6. Compare – Compare the finalists of each role with external top talent.
7. Analyse – Analyse data collected and synthesize final recommendations.
8. Recommend – Recommend final candidate for the critical role to responsible committee.

To discuss how this topic could impact your business, visit Cornerstone International Group (Middle East) or contact the author directly at stelios-pigadiotis@cornerstone-group.com 

Attracting and retaining top performing executives is the true lifeblood of successful organizations, yet identifying and attracting them can be a challenging endeavor.

Top performers, in leadership roles, will deliver about 50% more than the average and will improve their organization’s competitive position. Yet, according to McKinsey, 82% of Fortune 500 executives don’t believe that their companies recruit highly talented people.

There are many reasons organizations do not target A-Level talent: lack of resources, concern about internal pay inequities, lack of managerial confidence, chemistry/fit, etc.  However, organizations of all types, must strive to both attract and retain talent that will improve their competitive position. 

Specifically, organizations must develop and embrace a strategy that supports the hiring of talented executives.  They must live the concept that a rising tide floats all boats…that to win in the market they must accept new ideas, concepts, and recruit and retain top talent.

So how do you find and recruit “A” Talent? 

Speaking from experience as a member of a global executive search group, identifying “A” talent is best accomplished using a disciplined process that must include four tangible measurements.

When incorporated into the executive search process, the following will facilitate an organization’s ability to identify and attract best-in-market talent:

1. Determine Current Organizational Position/Potential

Often, the assumption is made that because candidates have worked for top performing competitors (or academy companies such as GE or P&G), that they are automatically a top talent.

With the cost of a mis-hire being more than 4x annual cash compensation, this can be a costly assumption. Once you have identified potential candidates, but before you contact them, recruiters should speak with knowledgeable sources such as alumni of their company and competitors.

These pre-references will ensure a consistently higher level of candidate quality and help determine fit to the new organization.

2. Ensure a Progressive Career Track

Ensure that the candidate has had progressively more responsibility throughout their career.  Has he/she made the appropriate decisions including agreeing to take on risky and more autonomous roles within their current or prior organizations?   Has he/she stayed in roles long enough to deliver consistent and high-level results?

Have job/company changes been made to further the career in terms of scope and responsibility, or just for more money? Is the candidate a job hopper, never staying with the same company for more than 2-3 years? 

3. Assume that Compensation and Talent are Linked

Compensation levels often reflect the quality of the candidate. This is a basic and irrefutable law of our open market economy. Top talent commands top dollar, and quality candidates are typically compensated at a higher level than their peers.

While there are obvious exceptions, this is true over 80% of the time. For example, a General Manager making $200,000 is more than likely a stronger candidate than a comparably experienced one making $125,000.

Keep in mind that “A” players are well compensated and their respective organizations will fight hard to keep them with rich, comprehensive, and long-term packages. It will typically require a premium to pry them away.

4. Senior Level References

After the initial references mentioned above, subsequent references must be conducted with senior line management highly familiar with the candidate. Most senior level executives will readily agree to be a reference for an “A” talent executive. Because of their rank and experience, they are the most candid and useful references.  

In closing, identifying, attracting, and retaining “A” talent is not an easy task, yet is paramount to the success of almost any organization.  While using these measurements will result in improved talent levels, they are not the only components of an overall recruitment plan.

For ultimate success in the market, management must commit to identify and hire individuals who will challenge them to take the business to the next level. 

Organizations must commit to a strategy of hiring the best person for the job, not the best person looking for a job.

About the Author:

Walter is a Managing Director with Cornerstone International Group, a leading Global Executive Search Firm.  He is a former member of the Americas Council of the AESC. Based in Atlanta and Washington, DC, Walter has over 25 years of retained search experience. He can be reached at walter-baker@cornerstone-group.com