With very good intent, many executive leaders celebrate the bottom-line (which is fine), but at what expense? Many leaders are simply hard-wired to celebrate nothing but hard-core metrics. They look at these metrics with a linear lens vs. viewing them as multi-dimensional forces that impact an entire system (the ‘system’ being their organizations). If not careful, the linear approach can leave a very messy path of chaos and frustration (i.e. the “Mr. Magoo” effect).
As one recent CEO boasted to his exec team during a two-day annual planning session (which was the first time I had worked with this company): “You should know that we well exceeded our sales goals this past year. We should really pat Fred [name changed to protect the innocent] on the back and have a celebration!” What I couldn’t help but notice was the mood in the room at this point in time–which was anything but energetic.
So…because it’s my job…I asked about the lackluster feeling in the room. What ensued was a discussion they had been avoiding.
What might be some potential implications–both positive and negative–now that we see we’re going to way exceed our sales goals? (This team had only had a very general discussion about these opposing forces. Hence, there was no commonality amongst their thinking relative to implications. Result: Frustration.)
Since our sales goals are exceeding our expectations, what clogs in our systems and processes might we expect? (Their outstanding success in exceeding their sales goals was their current reality. While exceeding in sales is certainly a good thing, there was also a huge list of negative implications that were going to begin threatening their long-term ability to be a strong company. Result: Chaos.)
By how much can we exceed our stated sales targets within a given timeframe and still be successful long-term? (Never discussed, so there was no metric set to help them guide their thinking. Result: Confusion.)
Should we control our growth methodically or randomly? (The Head of Sales said ‘randomly’ because that’s the nature of sales. Everyone else said ‘methodically.’ The Head of Sales said he meant ‘methodically,’ but that he couldn’t sit around and ignore windows of opportunity. Result: Frustration; Chaos; Confusion; Lack of Alignment.)
The reason for the less than cheerful celebration for exceeding the sales goals is that they simply couldn’t on-board new customer groups fast enough to keep up with the excessive sales. So while a celebration may be in order, the only one cheering was the Head of Sales. (And it didn’t help that the Head of Sales kept boasting about his sales success. Everyone else at the table was, literally, physically and emotionally drained.) The Head of Sales didn’t purposefully intend to create a “Mr. Magoo mess,” but that was exactly what he was doing. While his metrics were SuperGreen, everyone elses metrics were off-target because they just couldn’t keep up. The potential result was that their organization’s Path of Progress was going to be severely impeded due to a number of negative implications.
While metrics are of paramount importance, an entire set of metrics have to provide some sort of balance…and getting to this balance can be messy because…
- It forces discussions that simply aren’t comfortable.
- It forces hard decisions.
- It forces a look at the brutal facts.
- It forces strategic conversations (that are truly meaningful vs. being mere ‘cocktail’ talk).
- It forces a different kind of thinking.
- It forces alternatives for deeply rooted issues and challenges for which there are no easy solutions.
- It forces a stronger sense of balance and a higher level of understanding.
The catalyst for any company’s forward movement is Strategic Thinking. Here are a few key points to remember relative to creating your own strategic framework for your company’s forward movement:
- Strategy is about creating clarity of thinking. Without clarity, assumptions are made (about people, about the organization, about ‘whose fault’ it is, etc.). The problem with the organizational example used in this blog wasn’t the Head of Sales. He was just doing his job. The problem was avoidance mentality. Without a hearty discussion around some really difficult topic areas, nothing was going to change this dynamic. Key Questions: Where does chaos live in our organization? (i.e., What are our top three organizational pain points? Which one, if resolved, would be a key driver for our forward movement?)
- Strategy is about working ‘on’ the business as well as about working ‘in’ the business. Success doesn’t rest in just one or the other. Both must work in tandem to create forward movement. While the Head of Sales noted in this case review was excelling, he was the Mr. Magoo of their organizational world, leaving behind him a path of disruption and chaos. Inadvertently, this entire leadership team was creating an organizational culture of confusion. Without a few hard discussions, nothing was going to change this dynamic. Key Questions: To what degree is our Head of Sales (in this case) as well as the rest of us comfortable with slowing down sales? Why or why not? Should we? Is that the answer? If not, then what is? What will be gained and lost? During what timeframe will we slow down? As for our Head of Sales, what can we do to solve any dilemma created for him as a result of us slowing down a bit until we get our house in order? And…Based on our own leadership chaos, what kind of chaos are we creating for others in our organization? And as a result of that, are we creating the organizational culture to support the long-term results we say we want to achieve?
- Strategy is about creating a combination of ‘Winning Moves’ and ‘Key Initiatives’ that will give an organization the forward movement it needs to propel growth. It is these identified Winning Moves that are key drivers of new revenue. However, if your core strategy consists of nothing but a list of Winning Moves OR if your strategic objectives are totally dominated by one Winning Move, then your framework for success could be out of balance. This is what this team was experiencing. Instead of having a Path of Progress around a key Winning Move, they had inadvertently created a Path of Chaos. Back to point #2: What was needed was a stronger mix of Winning Moves (revenue generators that work “on” the business) and Key Initiatives (strategies for working “in” the business to keep it strong and healthy enough to support their continued growth). Without an honest discussion of their current reality, however, nothing was going to change this dynamic. Key Question: Is your strategic framework designed to hold the weight of what you’ve created?
To minimize the “Mr. Magoo” effect in your organization, incorporate elements of your company’s current reality into your Annual Planning sessions as well as into your ongoing discussions throughout the year. Allow your metrics to guide a multi-dimensional discussion rather than a linear one. In doing so, you’ll come closer to creating your organization’s Path of Progress so that it aligns your team’s thinking around your primary intent of achieving forward movement.