Category Archives: Leadership

Decision-Making: Deliberation Without Attention

doors-1767562_960_720 decisions

“Every thought on the wire leads to a fall.” – Philippe Petit, High Wire Aerialist

People feel much more responsible for their actions than their inactions. Joseph Hallinan says in his book ‘Errornomics – Why We Make Mistakes’ that at the moment you think you’re making a decision, it only seems so. It’s really long after the real decision was actually made.

This is an extract from my book ‘The Brain-Based Boss’.

Most days are made up of a series of decisions. Some are like which of three cereals should you have for breakfast or which task to start next. Some decisions might be about buying a house or signing a contract to undergo elective surgery. Maybe you agonise over every decision or just the big ones or none at all? The rest you just go with your gut feeling. Sometimes you’ll regret the decisions you make, or choose not to make, and sometimes you won’t. What’s the smartest way to make decisions or help others make them? It depends on the complexity of the decision.

Ap Dijksterhuis out of the University of Amsterdam conducted several studies on just this subject. However, like many of the researchers I’ve read for this book, they used sentences like, “Because of the low processing capacity of consciousness, conscious thought was hypothesized to be maladaptive when making complex decisions.” And they’re right but wordy. In my words, it’s hard to think about a bunch of complicated things at once.

You might like to imagine you’re a rational, logical person who’ll weigh up the pro’s and cons of each decision you make, especially the big ones, and make the best decision you can with the information you have. But what Dijksterhuis proved was quite different. He studied consumers and shoppers in lab conditions and in actual sales situations – during and after. The ‘after’ is especially important, as that is when the true quality and impact of a decision hit home.

All participants were facing a purchase decision of varying sizes. Half were interrupted and distracted during their decision-making process. All were subsequently followed up on how they felt about their decision post-purchase. The thinking was that the distraction allowed the unconscious mind, which can handle lots of complexity at once, to process the decision. It hooks into the brains emotional centres. This is where ‘gut feelings’ may come from. Plus emotional responses to the decision choices are pre-rehearsed and emotional responses to each assessed by your brain with you not consciously aware of them.

His findings were that “simple choices (such as between different towels or different sets of oven mitts) indeed produce better results after conscious thought, but that choices in complex matters (such as between different houses or different cars) should be left to unconscious thought. Named the ‘deliberation-without-attention’ hypothesis, it was confirmed in four studies.”

Conscious thought focuses attention on whatever factors manage to squeeze themselves into our limited conscious mind at the time. That distorts perception and can over-inflate the relative importance of certain factors.

Researcher Loren Nordgren joked about Rene Descartes’ famous quote, “I think therefore I am.” That was all well and good but was he always happy with the shoes he chose to buy? Over-thinking doesn’t make for good decisions when it’s not a simple decision.

I’m not suggesting that lack of attention is a good thing. Otherwise we may as well put teenagers in charge of all the important decisions. Most can usually (always) be relied upon to provide the ‘without attention’ component! No, it has to be a bit more structured than that.

Both studies look at what might be called intentional self distraction. They contrasted three approaches to decision-making: make an instant choice, long list of pro’s and cons, briefly distracting the conscious mind. The latter was the most effective and, down the road a bit, evoked the least regret.

If you just skim read Malcolm Gladwell’s book ‘Blink’, you might assume that instant decisions are often best. But on closer examination, I reckon Gladwell agrees with Dijksterhuis. Both reject the supposedly time-tested tradition of logically weighing up over a period of intense concentration a list of pro’s and cons. It takes ages and delivers a poorer result.

My shorthand version of a useful process is:

1. Introduce the problem and range of solution options

2. Carry out a pre-set 3 minute distraction activity.

3. Return to the problem and / or the options. Make your choice.

4. Live with it.

So, what?

I had it drummed into me and I subsequently preached to those I trained about the commonsense of structured event interviewing as a tool for recruiting. I was schooled on the value of decision matrix spreadsheets when evaluating complex contract tender responses. Does this research mean those formal processes have no value? No. Recruiting and big contracts are expensive and the consequences of mistakes are significant. At the very least, you may need to retrospectively justify your decision. (ie Cover your butt.) I think the lesson of deliberation-without-attention is that it pays to try both approaches. If they don’t match, you might need to do some more research and ask some more questions.

_____

Check out my new motivational presentation at http://www.2dangerousthingsayear.com

More ideas at http://gettingbetterbuyin.com/ 

Signup to one email per month summarising these blog posts.

Empty Nesting

empty nest

Both my kids left home this past week. They’ve done it before. They may do it again. It’s not quite like a generation or two ago when leaving home was a definitive cut-off and a one-way trip. These days there’s the term ‘boomerang kids’ for those who keep coming back (no matter how far you throw them). And, apparently, in Italy they never leave.

They first left home a year ago to go to university in a different city but they were staying in halls of residence and they were together – regularly checking in with us, and back each term break. Given how much time they used to spend out or in their rooms, it really didn’t seem that different. This time round it seems more real. They’re flatting separately and we’re now also missing things from our house as well as them. Still, how many frying pans does one really need?

Also- that’s two drivers off Auckland’s roads lessening our household’s contribution to the congestion by 50%. I challenge all other Auckland households to do the same. Hey, Auckland Transport, I’ll expect some congestion charge discount in your planning thanks.

In my new presentation about change and how to build resilience in anticipation of inevitable if unpredictable change, I briefly reference the Sigmoid Curve. It’s an oldie but a goodie as a mental model for understanding natural processes and lifecycles. Originally noticed in the world of nature, it’s subsequently been applied to lifecycles of products, organisations, societies and relationships. Picture a seed and its growth as a graph. Initially growth is negative as it gears up and stores resources for the big sprouting then it shoots and grows up to a peak then declines then [spoiler alert] some terminal point.

sigmoid-pic

The trick, experts say, is to pick a point before the decline and either start another curve or reinvent the current one so that it is, in effect, a new one. Timing is important as you need the resources to begin again and no one is giving resources to a declining curve.

I want to make the analogy to work teams, using both the kids leaving home and the Sigmoid Curve.

As fast as two decades of parenting has zipped by, the change in our home ‘team’ was inevitable, even if the specific circumstances and timing were unpredictable. This is true in work teams and at a much faster rate. I led one group for over a decade and one of the things of which I’m most proud was that at the time of the initial recruitment and building of my team, I was also developing plans and processes for the inevitable reinvention of that team. It did take longer and I didn’t HAVE to do it, but within only a few months my righthand person had to quit and go overseas due to a family health crisis. I was ready and whilst surprised and supportive, I wasn’t shocked – family health crises happen. Not only was I able to instantly implement plans to temporarily and permanently replace that person, I was able to have that person involved in the process, thus helping me out and giving them a lessened sense of guilt and a heightened sense of closure.

One of the most dangerous phrases in business and life is, “If it aint broke, don’t fix it”. That’s super naive and dangerously unrealistic. I”m not saying deliberately break things (although I”m not saying not to do that) but we all have a spare tyre in our cars because a flat tyre is inevitable. We try to save a bit of money and have a few spare frying pans and advice for when our kids leave home. So, regardless or perhaps because of, how optimal you think the team you’re leading right now is doing, start prepping for the inevitability of change and someone – a key person – leaving the nest.

——

Check out my new motivational presentation at http://www.2dangerousthingsayear.com

More ideas at http://gettingbetterbuyin.com/ 

Signup to one email per month summarising these blog posts.

To what extent are you seeing what you want to see and disregarding the rest?

muscles skinny mirror

Meta-cognition is a fancy term for thinking about how we think. We don’t often do it because we’re all so caught up in actually thinking or, more probably, doing stuff with as little thought as possible. (I might be judging myself on that point). The mindset and beliefs we have got us to this point and if this point is OK or better, there are risks in changing and challenging. But things won’t get better if you don’t.

In short, one answer is to deliberately surround yourself and seek out and expose yourself to information sources that you know will challenge you. I’m not suggesting you live in a perpetual state of stressful heightened awareness and self doubt but at the very least you gotta have someone who’ll call you out. Diversity is the broadest sense is even better. Source from beyond your bubble.

You won’t have time to think about everything, after-all that’s why you revert to confirmation bias to begin with, but perhaps approach conversations with an open mind. Don’t be so quick to judge.

Surround yourself with different types of people. Don’t label yourself. Be well-rounded and willing to hear different types of opinions on politics, religion, and life in general. This is a sign of intelligence not passivity.

It takes incredible mental strength to challenge your own deep-seated beliefs. Stand by your convictions, of course, but just realize some of that just may be rooted in confirmation bias. Be open. After-all. life is full of the gray stuff. We wish it were simple. This is right. That is wrong. It doesn’t always work that way. That’s why it’s good to be aware. Self-aware.

This article explains confirmation bias and some more thinking around addressing it.

– – – – –

More ideas at http://gettingbetterbuyin.com/

Signup to one email per month summarising these blog posts.

Performance Management Moneyball

data screen

I’ve been following NBA basketball pretty intently for thirty five years. These days I watch games in high-definition on any one of a number of devices via an online streaming or on-demand subscription service the NBA provides me. You know who else is watching that same footage and has access to the same stats and more in real time? The players!

We probably couldn’t see it in 1982 because of collusion with broadcasters or just the terrible quality of analog broadcasts in the 80s but players were probably smoking and drinking on the bench during games. Maybe they were trying to blend into 80s society? I can’t say they were for sure as I wasn’t there but I can’t say for sure that they didn’t. In 2017, modern players all sit each with their own individual tablet device provided by the team with close-to-realtime videos relating to their own performance, accompanied by statistical breakdowns on the team generally and them specifically. No one is smoking or drinking and if anyone so much as opens a bag of skittles, they’ll likely get fined and sent to make an appointment with a counsellor, then attend a restorative justice session for any members of the team who were emotionally triggered by the insensitivity.

Kiwi Steven Adams is doing well in the NBA for the Oklahoma City Thunder. He, and we, could simply assume so based on his recently formalised nine-digit contract. A nine digit contract!? I barely have that many digits on my hands. Salary in pro sports, as in any other job, is no real gauge of performance. As pro rugby players do, even in little old New Zealand, Adams wears a device within his uniform as he runs up and down the court and it measures much more than the official game stats and transmits that information to where it is automatically and instantly collated and compared and returned as multi-media reports to Adams, his coaching team and the management, who ultimately sign off on contracts.

There is a correlation between easily measured metres run and success at basketball worthy of reward. It’s not everything. If he was a disruptive influence in the team, talent notwithstanding, he could be cut or traded. A Lakers player who thought it would be hilarious to tape one of his teammates confessing to cheating on his popstar wife, then putting it on social media is no longer a Laker. He is now with the Brooklyn Nets – a team with one of the worst 3-year stretches in the history of the game. Karma baby.

The Nets’ GM is Sean Marks. He’s a kiwi – New Zealand’s first ever NBA player and now an executive on the up. When you have a job that is historically on the bottom, the only way is up. He’ll have performance measures of his own in place. The team is owned by a Russian billionaire and they’re famous for feedback. Could marks’ performance be managed as clinically as Adams’?

If we’re talking about performance management in work generally, the underlying foundation ultimately is measurement of the actual level of performance and comparison to an expected level of performance. Ideally, these would be as objective as possible and for some jobs that is challenging. Basketballers can count points, rebounds, assists and a variety of other easily measured things. Historically, some players on poor teams on the last year of their contract did something called ‘padding their stats’. They put their own interests ahead of the team to make their numbers look good. I’ve worked in a couple of places where sales folk did similar things. The nature of the measuring of performance drove behaviours that gamed the system.

Nowdays, with moneyball execs and algorithms and such, there is a basketball measure called ‘Real Plus/Minus’ that, whilst not perfect, does a fairer and more accurate job of ‘scoring’ a player’s actual contribution to the success of the team. Fans can see in realtime and players at the next timeout the difference their efforts are making or not. How do you think that might impact the performance of average working people in more mainstream jobs, like plumbers, contact centre reps or cheesemaker? I have a sideline as a comedian and that is the most well performance managed job on Earth. For a start, it is literally (and I literally mean literally) a performance. If they laugh that’s good feedback. If they don’t laugh, that’s also good feedback. It’s instant, it’s honest and it’s independent.

Real Plus/Minus is complex to calculate and only started in 2014. Not all coaches love it. Some stick to their subjective ways. Prior to that, coaches and scouts had to look at whatever numbers that were available, then think about how they felt about that player and their contributions to productivity. And on that, players were judged. How confident are we that most managers of work performance don’t manage performance like meteorologists of old, licking a finger and waving it in the wind?


More ideas at http://gettingbetterbuyin.com/

Signup to one email per month summarising these blog posts.

Self-Discipline: How To Refill Your Willpower Tank

brain gym

You’ve only got so much self control; Don’t waste it!

This article in ‘Psychology Today’ by Susan Krauss reports on Roy Baumeister’s work about how our self control can be sapped through overuse.

Personally, I’ve always had a mental model of willpower / self discipline / self control as a muscle that you could exercise and get to grow stronger. It turns out to actually be a tank that gets emptied but can be refilled and we can rely on random chance to do it for us, or be proactive and consciously and deliberately take actions that refill our willpower tank.

Oddly, the only thing proven to do so is consumption of small amounts of actual sugar. As much as we’d like to think of ourselves as rational creatures who, through strength of character, can be better people, maybe our natural level of self control is set through natural random chemical chance? It’s like those old Donald Duck cartoons where he’s in a dilemma and on one shoulder a little duck angel appears and on his other shoulder appears a little duck devil who argue it out into each of his ears. This ‘strength’ or ‘ego depletion’ theory implies that the angel gets weary and the devil gets his way until the angel rests up. And the best advice is to slip the angel a barley sugar or a powerade like it’s on a triathalon.

Krauss argues, and I agree, that if the model is that of a muscle that gets tired, then maybe the same progressive development can be applied to our willpower muscle that bodybuilders apply to their actual muscles. Keep working it out and it’ll get stronger over time but you need to keep increasing the weight / temptation to build it up. No pain; no gain.

No weight trainer or body builder says, “I’m going to curl this 20kg with my bicep forever,” yet you’re supposed to say, “I’m never going to have chocolate cake ever again.” That seems unrealistic, demoralising and potentially counterproductive. Weight trainers say, “I’m going to curl this 20kg weight 8-12 times or until I can’t, then rest, then do that set two more times. After time, that’ll get easier and I’ll increase the weight.” I don’t know what the cake equivalent is but it isn’t, “None ever again.” Work up to it.

Employers probably aren’t directly interested in employees’ cake avoidance or body building abilities but willpower / self control is likely a contributor to perseverance and grit which, as I write about frequently, are the most common precursors to success at work (or anywhere else for that matter.) So, if you’re leading someone at work who gives up, can’t focus for long enough or is constantly engaging in temptations that are distracting them from activities that should be adding value to their work and their lives, what can you do?

Well, if we’re stick to our weight training metaphor, you become their personal trainer. Not one of those old school cliche ‘Drill Sergeant’ types who shout, “You’re worthless and weak!! Give me twenty!!” Set challenging but realistic micro-goals that progressively build towards the desired target. Each success builds on itself, they’re more likely to buy-in to it and participate and, ultimately, you and they are more likely to achieve the end goal. But even the fluffiest of personal trainers aren’t pushovers. They don’t accept excuses and they demand honesty and effort.

And the irony is, given that sugar refuels our willpower tank, even if you do eat the cake, you may regret it but you’re less likely to eat more cake. So, in a tenuous way, you can have your cake and eat it too. Try a handful of dried cranberries. They’re the supposed ‘Superfruit.’ You never hear of ‘Supercake.’ (If you have heard of ‘Supercake’, please do let me know…)

– – – – –

More ideas at http://gettingbetterbuyin.com/

Signup to one email per month summarising these blog posts.

Why do some people micro-manage?

time bunny

I ran a couple of workshops this week on effective delegation with a law firm. I’ve also run these many times with many non-law firms. There’s a point after we agree on a definition of what delegation is, then discuss the potential benefits and differing objectives delegating might purposefully achieve if conducted effectively in a structured and tailored way. Right after that we tackle the reasons, justifiable or otherwise, why some people might choose not to delegate, or to do so ineffectively (whether or not those people were even consciously aware of why they were doing so).

Earlier, I’d sought from participants real-life stories from their own experience or observations of instances they considered to be effective and ineffective delegation. This week, as always, the vast majority of ineffective and unfortunate examples involved actions that could be encapsulated as ‘micro managing’.

We’ve all been there.

My own story was being lectured and berated on my sweeping technique in a building supply warehouse in which I worked in the mid 80s. I’m certainly over it but even in the retelling, I still get a hackle-raising sense of frustration in my blood. Others shared similar tales from their own back-stories.

One of the major reasons the groups self-identified behind people choosing to either not delegate or to pretty quickly start sticking their oar in again was to do with time and perspective.

If all you’re focused on is today and the ticking clock of a deadline, it may well be true that you can do it better and quicker yourself rather than delegating it. But if you’re focused on the big picture and the long game, you’re more open to realising and accepting that the point of delegating isn’t just about getting this piece of work done as soon as possible. It’s about getting many more pieces of work done again and again constantly. It’s a false economy to try and fool yourself that hanging onto tasks that could be done by others is effective leadership, simply because this one time you beat the buzzer. There are many more pieces of work than you are physically and mentally incapable of doing. It’s a simple capacity issue – if you’re focused beyond today. Delegating isn’t about flicking a task or two to the lowest-cost grunt able to competently do it, it’s about building capacity in your team in a planned, measured and deliberate way. Quite apart from getting stuff done, it exposes different people to your clients, builds trust, identified problems and mistakes early enough to rectify them, creates skills for succession planning and developing cover. If only one person can do a particular task and they get hit by a bus, or leave, or set up in competition, that’s a poorly managed risk.

Some people naturally have a time focus on the immediate short-term; others naturally look down the line a bit. The group had some ideas about how to not rely on nature, logical argument and luck to nudge the mindsets of those those now-fixated folk into the future a bit. One was around stories – not dissimilar to Scrooge and the ghosts of Christmas past and present. If micro-managing leaders can be exposed to leaders who used to be like them but saw the light, or that light they saw was the fire that burned them, them some lessons can be passed along forming organisational learning and memory. And everyone benefits, maybe not today but soon enough. And the sooner they start, the sooner it’ll happen.

– – – –

More ideas at http://gettingbetterbuyin.com/

Signup to one email per month summarising these blog posts.

How Much Of A Values Overlap Is Needed Between Employers & Employees?

geese sunset

There’s a lot to be said for working for an organisation where your personal values overlap significantly with the organisation’s. In the employee recruitment process, along with interviews, CVs, referees and behavioural profiling, I’d really appreciate a single, simple graphic: a venn diagram showing how much of a ‘values overlap’ the applicant has with the potential employer. The temptation would be to print it out in full colour. Out of respect for the planet and its future, please do not do this.

How do we know what a person’s values are or those of an organisation? Quite a lot of people and organisations might publically declare them to us and the world. Individuals can pop memes and inspirational posts up on social media in a hope that we will view them and extrapolate them to be lovers of sunrises, geese in migration, or, on Mondays, flocks of geese migrating across sunrises. Companies have professionals facilitate out of their leadership team a printed list of values that gets framed and hung pride of place in reception and the lunch room. I’m sure all these people and organisations are well-intentioned but reality is often incongruous with those stated intentions. The road to hell is paved with good intentions, which still makes it infinitely superior to the intersection of Albany Highway and Oteha Valley Extention which seems to have been paved with 3 different sized ox carcasses, then a very thin and crumbly layer of off-brand asphalt.

Regardless, or irregardless, of what we say our values are, our behaviour betrays us. This is true of us and of organisations. There’s plenty of white collar fraudsters in prison who had accountability, excellence and integrity on the values statements of their business or professional association. Although, in fairness, the fact that they’re in prison does at least tick the ‘accountability’ box.

Venn diagrams and values posters aside, if you’re into observing reality, a good indicator of shared values are the growing range of corporate social responsibility projects going on. Some are well established and more about support and sponsorship. Funding a native parrot is great. Few employees or customers are going to tweet, “I hate Kakapos!!!” Nor should they, as three exclamation points are excessive and the plural of Kakapo is Kakapo not Kakapos. These types of corporate social responsibility efforts are passive for the vast majority of employees. The ones that may be a measure of some degree of values overlap and engagement are the ones that require overt activity from people on the ground. Some are well established and most worthy but do not require a lot of effort or cognitive contribution. Collecting coins in a bucket outside your work’s front door in exchange for colour-coded flowers or stickers for a good cause is admirable. Hoofing it into a steep muddy forest to plant carbon-offsetting treelings to save the world for our grandchildren is up the rankings a bit in my opinion.

If corporate social responsibility can be defined as a corporation’s initiatives to assess and take responsibility for the effects on environmental and social wellbeing, then we need to look at funding or support via inertia for the production and distribution of nukes, landmines and cigarettes. I’m not a fan of smoking but it is kind of shocking to see cigarettes third in a list that started with nukes and landmines. I guess if you added up the death, injury and misery, then cigarettes belong on the list. Someone recently sent me the findings of a study into the world’s deadliest animals. First was mosquitoes, then mankind itself, then snakes. Sixth was freshwater snails. That’s way more out of place than a list with smoking, nukes and landmines.

Collectively, we as consumers have more power than we realise. If we can leverage the power of the group to stop buying the products or services of a company that doesn’t agree with your views on marriage equality, then why can’t the talent in the employee marketplace exhibit that same influence by choosing to work with someone who does agree. A company cannot and should not ask an applicant their views on marriage equality or many other belief-based topics. Most applicants are not going to directly ask a recruiter or potential employer their official or personal views on such topics either. But, they might watch the news or so some internet searching and the organisation’s behaviour will betray its true values.

For an activity to learn more about your team’s values and internal ‘operating systems’, check out my one-page personal user-manual project at http://www.myusermanual.net

The term ‘silent majority’ is likely equally applicable to employers as it is to the voting public. Most people do not attend marches or sign online petitions. Most employers do not declare themselves to be pro or anti most things. But if you’re an employer who wants to attract the truly talented and those within that group with whom you share values, you’ve got to stand for something. Those potential employees are talented; they’re not psychic.

More ideas at http://gettingbetterbuyin.com/

Signup to one email per month summarising these blog posts.

How Open-Minded Are You?

Minds are like parachutes

This blogpost might be challenging for some. It was for me. I like to think of myself as open-minded. (Actually, I just like to think of myself generally. But that’s something else I need to work on). But am I really that open-minded? How would I know? Is there a scale of 1 to 10 upon which I’m a 7?

Psychologist Carol Dweck led the way with research on fixed versus growth mindsets. Crudely and sweepingly summarised, there are two types of default thinking positions and if you don’t effortfully choose one, you likely have a default. The post explains more. I especially like point 2 – when you meet an idea, do you start in response with statements or questions? That was something of a relief to me as three of my five sentences in paragraph one were questions.

There’s a quote that the ability to change your mind is a superpower and another that the true test of intelligence is the ability to have two opposed ideas in your mind and retain the ability to function. If I’m having a good day after a good sleep and have eaten wisely without deadlines yelling at me, then I’m in a resourceful state and I’m certain I could manage that. Other days not so much. It’s the other days that can cause us and our people some problems. It’s for those other days that wee need to prep and practice so when it gets tough, our open-mindedness keeps goings.

Do read the article but if you’re having a low resourcefulness day, here’s 7 quick questions to assess yourself against:

  1. How do you respond when your ideas are challenged? (My new thing is ABC – always be curious – WHY are they challenging them?)
  2. Are your first responses statements or questions?
  3. Do you seek first to be understood or to understand?
  4. Do you use the phrase, “I might be wrong but…”
  5. How often do you interrupt?
  6. Can you simultaneously hold opposed ideas?
  7. How much effort do you put into testing your own views? Do you deliberately seek evidence to the contrary?

More ideas at http://gettingbetterbuyin.com/

Signup to one email per month summarising these blog posts.

Family Business: When It Comes To Business, Don’t Mess With The Family

sopranos-the-h-1920x1080

Employees are sometimes heard to say that their workplace is, “like a family.” I always like to presume they mean that in a positive sense and they don’t mean, “like the Bain family.” But is it really a good idea to run a business like a family?

I’ve just completed MCing a series of regional awards dinners around New Zealand for the dairy industry. Hundreds of people from, or supporting, the dairy industry all scrubbed up and dressed up in places like Hawera and Awakeri. I wore a custom-made tuxedo but if I could have found one by Swandri, I would have worn it.

This was my second year of hosting them and, more significantly than just being around successful business people, I was exposed to the system that nurtures, develops and challenges them. You can wax romantically about some rose-tinted vision of families as much as you like but this industry’s consistent success is driven by a system deliberately designed to be progressive and improving continuously on a nationwide basis.

I’m not sure these days what mental images are struck in people’s heads when they think of dairy farmers but old stereotypes should be long gone. I estimate about half the category winners are women. They’re all very online. Many are not from a long line of dairy farmers.

That said, a lot of emotional acceptance speeches are given thanking mums and dads. (When I said “emotional”, I meant emotional. It wasn’t a euphemism for drunk, a.k.a ‘tired and emotional.’ There was only one really drunk speech and that was superbly hilarious for four minutes. I stopped him at four minutes. Trust me, no one ever finishes gracefully after four drunk minutes.) The genuinely emotional and sober declarations of thanks frequently cited the parents and preceding generations. Often there was a joke about providing babysitting services but it was quickly and demonstrably evident that it was much more than that. From capital investment, advice, motivation, assistance and connections, these business families help each other. It goes beyond help into intergenerational sustainability and this is where I think it can be truly powerful to run some businesses like certain kinds of family.

If you ever want to play an original drinking game at a dairy awards, just skull a shot every time someone says the word “sustainable.” You’ll be having an early night I assure you. They say it a lot because they mean it a lot. Environmental sustainability is critical to these best of the best, because it’s also about being economically sustainable. These people don’t have perverse short-term contractual incentives like some corporates designed to encourage the boosting of quarterly profits. This is about the long term in a truly inter-generational sense. I doubt many bank CEOs planting a tree will be in the job when that tree matures.

Forbes recently ran an article noting how the companies with the greatest combination of scale and longevity tend to be family businesses, or at least were family businesses originally. Many of these were over one hundred years old. A similar proportion of family businesses fail along the way as non-family ones but a disproportionate number of stayers are handed down on blood lines.

The NZ Institute of Directors estimates that about half of businesses are family businesses. They cite the advantages of adaptability, ingenuity and passion, strong relationships with employees, suppliers and customers, and the ability to retain corporate or specialist knowledge within the company.

My friend Mike has a model of family business that says the first generation has the idea and the passion, makes the sacrifice and gets it going. The second generation takes it mainstream and optimises production, distribution and marketing. The third generation has a sense of entitlement and wastes it away, embarrassing everyone along the way downhill. New Zealand has a few famous surnames conforming to this model.

Dairying aside, the first thing I thought of when writing an article about running a business like a family was The Sopranos. Tony’s management style was effective in the short run but it didn’t end very

 

——

 

###END###

 

 

Thought Leaders

thought leader

%d bloggers like this: