August 29, 2009
I thoroughly enjoyed John Allison‘s visit to our Executive MBA class at Wake Forest University this morning. Mr. Allison is the Chairman and former CEO of BB&T, and has recently joined the faculty at WFU.
Mr Allison’s discussion was focused on the values that he help ingrain into the culture at the bank:
We had the opportunity to discuss the sub-prime mortgage crisis and how BB&T really got screwed by being forced to take TARP money. The real takeaways from the discussion, though, were the perspectives of a principled leader. The values described today seem on the surface like any other set of values you might see on any corporate bulletin board. When you study them in detail (and hear Mr. Allison describe them), it’s clear that these are the virtues of humanity, and not just a set of characteristics that might assist in business goals. The most poignant set of the values are the ones centered around objectivity and fact-based management. The most memorable quote from today’s session is that the number one reason a small business will fail is because the leader evades reality. You have to know your place in the real world around you.
BB&T has put a focus and premium on individualism, which could be a real risk. However, because the vision and goals are clearly defined and permeated through the organization, the individualism should ultimately lead to creativity and innovation, rather than anarchy. As Mr. Allison transitions to academia, I think he knows and can have confidence that his company is as well-poised to weather any shocks and disruptions as a company can be in these times. This is another example to me how the people in business are more important than any product or technology for ensuring long term value.
August 20, 2009
I recently read an article in the August issue of Valley Business Front by Anne Clelland. Her article deals with the question of what to do with a “meddling” employee who frequently questions management and even goes as far as suggesting changes to the company mission statement. Anne’s advice for this situation is:
The greatest gift leaders can give their employees is to draw a clear line between employer and employee, designate who’s to do what, and do the leader’s side with authority, credibility, and consistency….and lead the company so well that the meddlers can stop worrying about whether they’re the coach or you are, and be the true team players you hired in the first place.
My thoughts immediately went in an opposite direction.
In my mind, there are two likely reasons for an employee to “meddle” – 1) They actually have good ideas and are looking to take ownership in their organization, or 2) Management really has no idea what they are doing or hasn’t clearly communicated the vision. In both cases, the meddler is really an asset. The question is how do you capitalize on it.
In the first case, the employee is an idea factory. The mutual frustration exhibited would stem from a lack of a meaningful outlet . I’m not saying any employee in any company should be allowed a seat at every board meeting, but any employee in any company of any size should have a clearly defined path of influence on their area of responsibility. There are plenty of examples in many industries of this in action – line workers suggesting better locations for tools for increased efficiency, bus boys suggesting new recipes, and so on. If the CEO’s suggestion box is full, it’s probably because the lower level managers aren’t listening to their direct reports.
The second case likely stems from a lack of company identity. Perhaps an employee suggests a new mission statement because they have no connection to the current one. Communication of the mission and vision is much more than simply repeating it in email signatures or putting it on banners. The mission needs to be real. If a manager has to “draw a line” because they are challenged, it’s because the common goal is unclear. In a case where you might be tempted to say the meddling employee simply doesn’t fit and should be removed, you must think of why that employee was hired to begin with. It probably has something to do with an ill-defined culture and corporate mission.
In today’s world, no company, from a mom and pop grocer to a mega-conglomerate, can rest on their laurels that what get them here will be what keeps them in business 2 years from now. Cycles and spin-up time for new technologies are short and getting shorter. Companies can no longer “do one thing and do it well”. The new strategy should be “do one thing, and figure out the next way to do it better before the next guy does”. One of the best chances a company has to adapt and prosper is to act on good ideas. Stifling an enthusiastic employee with an “I’m the boss” defense is akin to shooting yourself in the foot.