Networking

I recently read the book View from the Top by Dr. Michael Lindsay, President of Gordon College.  Dr. Lindsay is one of the youngest college presidents in the nation, an award winning sociologist and frequent lecturer on the topic of leadership.  Lindsay interviewed 550 top national leaders as the basis for his book.  While View from the Top contains many thoughtful and helpful insights, his focus in the book’s opening chapter on “building your network” really caught my attention.

I’ve always had a gut reaction against “networking.”  Undoubtedly many of you will find that strange, and many of you probably network instinctively.  It’s a pretty typical thing for leaders to do.  However, networking conjured up images in my mind of talking to someone at a party and having them constantly looking over my shoulder checking out who they could talk to next.  Networking has always struck me as a “political” effort, a way of getting ahead based on who you know as opposed to what you do.  I’m not saying this view was right, just what I felt and thought.

Lindsay argues persuasively for leaders making networking a top priority.  There are many ways to succeed as a leader, according to Lindsay, but all require developing an effective network.  At first I resisted this and found the concept grubby.  However, as I read further, Lindsay opened my mind to see that one could develop a network without being selfish, arrogant or pushy, and that failing to develop an effective network ultimately limits one’s growth as a leader.

Lindsay speaks of “developing a wide ranging network of acquaintances.”  An effective network involves knowing people in a variety of different areas, people different than us, and even people we may not particularly like, not just people to whom we are naturally attracted or who can help us tomorrow.  Leadership involves serving others, and networks serve as “entry points,” or “introductions,” to people who can help us as we seek to serve others better.  In a time of unexpected crisis, they can make finding someone who can help much easier.  Using networks correctly are less a means of self-promotion and more a means of finding ways to serve and help others more quickly, efficiently and effectively.

One other perspective on networking.  I’ve written previously about John Maxwell, a speaker and author on leadership who has helped me tremendously.  As a younger leader, John would offer to pay people he wanted to meet $100, as well as buy them lunch, for two hours of their time.  Whether they needed the money or not, it was amazing how many of these people said yes.  These lunches allowed him to build his network effectively.  I think John would say that building his network at a young age was one of the primary keys to his success as a leader.

Finally, Lindsay makes an interesting point about how we can best form networks.  The most common and effective way, he argues, is to have a good mentor.  A  mentor can, and usually will, introduce you to other people who can help you.  A mentor can do this in a fraction of the time that it would take you to do it on your own.  In fact, having more than one mentor who can each help you in a different area is even better.

So, while I still need to fight my instinctive negative reaction to networking, Lindsay’s book certainly helped me develop a more balanced, positive view of how networking can help me in my leadership.  I encourage you to check it out.

 

Millennials

Last week, I experienced an interesting connection at my monthly Vistage meeting.  Vistage is a group of business leaders (about 15 in our group) that meet once per month to listen to an outside speaker and then discuss business issues that group members face.  This month’s speaker, Gustavo Grodnitzky, spoke on the topic of recruiting and retaining “Millennials”, or “Gen Y” folks (people born between 1982-2000, currently ages 14-32).  Gustavo presented an interesting summary of the four generations that are currently in the workforce, and then made a compelling case that the future success of businesses and other organizations will depend largely on their ability to recruit and retain Millennials.  At the end of his talk, Gustavo recommended two books, one of which was Drive by Daniel Pink.  As you may remember, in my last blog I wrote about Drive, focusing in particular on Pink’s theory of what motivates people.  Gustavo told us that while Pink’s theory of motivation applies to people of all ages, it applies especially to Gen Yers.  This captured my attention, and I thought you might find this connection between Drive and what motivates Gen Yers helpful.

In Drive, Pink argues that the three things that truly motivate people are “autonomy” (freedom to do your work when and the way you want), “mastery” (opportunity to master a skill or body of knowledge), and “purpose” (feeling like you’re doing something of broader significance, that you’re working for a cause).  In this blog, I’d like to focus on the importance of providing Millennials with a purpose, or cause, if you want to recruit and retain them.

At the Vistage meeting, Gustavo argued that Millennials need to feel that their work contributes to a worthwhile cause, to something more significant than just making money.  My wife and I have experienced this first hand over the last couple years.  As our now 23 year old son was exploring various career options a couple years ago, he mentioned frequently that he wanted to do something with more significance than just making money.  In other words, he wanted to pursue a worthwhile “cause”, something that makes a difference.  My wife and I reflected on how different his view was from our view 30 years earlier when we entered the workforce.  For us, it was all about getting a good job, working hard at something you liked, making some money, and then maybe at 45 or 50 having the opportunity to do something with more significance.  To be honest, we probably thought our son and his friends were looking for “too much too early”, and needed to be willing to pay their dues.  As it turns out, this was probably misguided thinking on our part.

As both a father and an employer, this wasn’t something I could ignore.  It’s a reality that’s much different than how baby boomers like me think about career and life.  At Baillie, over 20 years ago we identified the purpose of our hardwood lumber business as “To Help Others Succeed.”  The details of how we identified this purpose is a story for another day, but suffice it to say that I’m confident this purpose is more than just window dressing for us.  For the most part, our employees have bought into and connect well with it.  However, listening to Gustavo and reading Pink made me realize that we need to develop more concrete, down to earth ways for our entry level employees (most of them Gen Yers) to connect with and experience our purpose.  The morning after the Vistage meeting, I sat down with our HR Director and together we came up with a couple new strategies for doing this.  We’re actually pretty excited about them.  Hopefully they will work, but if they don’t, we will try others.

So what to do?  Maybe start by making sure your organization has a simple, clear statement of purpose.  Something a sixth grader can understand, that employees could recite easily at gunpoint.  Then, develop one or two strategies for making that purpose come alive for your entry level workers.  If Gustavo and Pink are right, if you can connect Millennials to a purpose it will be very hard for your competitors to lure them away with more money.  In fact, it will likely give your organization a competitive advantage.  I’m on this journey with you and certainly don’t have all the answers, but I’m convinced this is one of the keys to building the workforce that each of us will need to not only survive, but thrive, in the future.

Motivated?

Ever wonder what motivates people?  Really motivates them?  I’ve debated this question regularly with some of my colleagues in our hardwood lumber business.

Daniel Pink’s book Drive provides some surprising answers to this question.  Surprising because most experienced industry veterans think it comes down to one thing:  money.  Show me the money, they say.

While money does matter, Pink has a different view about what truly motivates people and drives results.  In fact, Pink argues that relying on money (or any external reward) can actually diminish performance, crush creativity, and foster short term thinking.  So what does motivate people?

Three things:  autonomy, mastery and purpose.  While money is not unimportant, according to Pink once people have a comfortable level of compensation these three things are what really matter.  Let’s unpack them one by one.

Pink says organizations tend to either “control” their people, or let them operate “autonomously.” Businesses that offer people autonomy have historically grown at a faster rate.  The dictionary defines “autonomy” as being independent, or self-governing.  In other words, giving people the freedom to decide what they should do, when they do it, how they’ll do it and with whom they will do it.  Sound scary?  Think it will lead to chaos?  Pink gives multiple examples where giving this kind of freedom to people led to intense engagement, and ultimately extraordinary business results (including the invention of Post-It Notes at 3M).

The second motivator Pink points to is “mastery”, or the desire to get better and better (even be one of the best!) at something that really matters.  When people are given the freedom to master a particular skill or field, they report getting into “the flow.”  I’m sure you’ve experienced being in “the flow” when you’re doing something you love, whether it’s skiing, hunting, baking, gardening, walking in nature, meditating or doing something else you really love.  When people are in “the flow”, they live deeply in the moment, they feel utterly in control, and their sense of time and place melts away.  Oh, and yes, they become more productive workers.  All this happens when a person feels they’re on the road to mastering something, becoming an expert in something that truly matters.

The final motivator comes from linking autonomy and mastery to a purpose people can see and buy into.  Pink provides a simple test to determine whether your people feel they’re working for a purpose.  Do they refer to the company as “we” or “they?”  If they refer to the company as “we”, they generally feel engaged by a purpose beyond a paycheck.  Pay attention for a week, and see how people refer to your organization or business.

I know you crusty, battle scared veterans are skeptical, probably even a bit cynical, about relying on anything other than money or external rewards to motivate.  But why not try it in a small part of your organization and see if it works.  It certainly worked for the several organizations Pink studied and describes in his book.

Welcome Your Critics

Last Saturday I read an interview in the Wall Street Journal with Tim Geithner. Geithner was Secretary of the Treasury during the 2009 financial crisis, and recently published a book describing his experience trying to lead the country through this difficult financial period. After discussing the financial crisis, the interviewer asked Geithner if he could point to any lessons he learned during the crisis that would apply to other walks of life.

His response really made me think, and I’d like to share it with you. Here’s what he said:

Make sure you surround yourself with people who will disagree with you. Make sure you have competition in diagnosis around you all the time. Make that an ongoing, relentless effort. If you do that, and put aside the concerns of how your actions will be perceived and how you will be criticized, you’ll be in a much better position to sort through all of the bad choices you face. It’s really important to make sure people feel they can disagree with you.

This statement made me think of the best-selling book Team of Rivals by Doris Kearns. In this book, Kearns describes how Abraham Lincoln surrounded himself with advisors who thought much differently than he did. In fact, the advisors he appointed were often from another political party, and in some cases had run against him for political office. They weren’t friends, and in fact they were often political enemies who at various times tried to sabotage him. However, Lincoln knew that he would make the best decisions, and be the best leader for the country, if he surrounded himself with people who thought differently than him, disagreed with him, and were even hostile toward him. He knew that the decisions that came from this body of advisors would be far superior to decisions that came from a body of advisors that all liked each other, got along with each other and thought like him. Although it led to numerous conflicts, this approach proved successful for Lincoln.

I’ve seen this work in our hardwood lumber business at Baillie. Over the last 25 years, we’ve had people in leadership positions who think differently and are not afraid to disagree with each other. Although it sometimes makes things less comfortable and leads to conflict and stress, there’s no doubt that we make better decisions, and ultimately have better strategies, when we have this diversity of approach and opinion. It’s not about being friendly and cordial, but about making the right decisions.

Even if you’re not in a leadership role in an organization, this principle can still help you. In your personal life, if you surround yourself with people that think like you, act like you, and are like you, you’ll probably have a stress-free, peaceful existence. The only problem is that you probably won’t grow, won’t be tested, and won’t increase your ability and capacity to do whatever you’re called to do in life. On the other hand, if you surround yourself with people who provoke you, who disagree with you, who challenge you and even make you mad, you’ll be on the path to growth and personal improvement.

So whether you’re leading a large organization or just thinking about cultivating a couple new friendships, think about surrounding yourself with people who think differently than you.

Innovation Reconsidered

Clay Christensen is one of the world’s leading writers on innovation.  I recently read his book The Innovator’s Solution, which was actually a follow-up to his previous book, The Innovator’s Dilemma.  The hardwood lumber business is often not on the cutting edge of innovation, so the book caught my attention.

The basic idea underlying Christensen’s books is that real value, over the long term, is created only by innovation.  If you’re not innovating, eventually your competitors will commoditize you, your margins will shrink, and your business will be worth less.

The whole book is worth reading, but I thought the most interesting part of the book was in Chapter 3.  In this chapter, Christensen explores the best way to pursue innovation.  He rejects the traditional wisdom that innovators should focus their analysis primarily on the customer, but instead says that the focus should be on how and when the customer uses your product or service.  This probably sounds a little vague, so let me share with you the example that Christensen gives.

A quick service restaurant chain wanted to improve its milkshake sales and profits.  Two sets of researchers came in to study the situation.  The first focused on the customer and the product itself (milkshakes), and asked a group of customers whether they wanted thicker, chocolatier, cheaper, chunkier, etc. milkshakes.  These researchers got feedback from the customers, and then used it to make some changes in the milkshakes.  However, despite these changes, the restaurant got no substantial increase in sales or profits.

The second set of researchers took a different approach.  They focused on what the customers were trying to get done when they “hired” the milkshake, and this gave the company’s managers new insights.  The researchers spent an 18 hour day in the store and recorded the time of each milkshake purchase, what other products the customer bought, and whether the milkshake was consumed on or off premises.

Interestingly enough, nearly half the milkshakes were bought in the morning.  People who bought in the morning often faced a long, boring commute, and wanted something to eat or drink in their car that would last a long time, wouldn’t be messy, and would satisfy them past 10 AM.  By way of contrast, people who bought milkshakes at other times of the day were most often parents trying to placate their children after a long, hard day.  Unlike the morning folks, parents wanted their kids to finish the milkshakes quickly and not have to struggle to suck a thick milkshake through a thin straw.  As a result of these findings, the restaurant created a thick, chunky shake for the morning customers (so it would last longer), and a thinner, “quick drinking” kids shake for later in the day.

The second group of researchers focused on the job the product was being “hired” to do, and ended up designing different types of milkshakes based on what the different groups of customers were trying to accomplish.  It wasn’t just about the customer and the product, but rather was about the circumstances in which the product was being used.

In the hardwood lumber business, it’s sometimes challenging to think about what real innovation means.  And when we do think about it, we tend to think about the product we sell and how we can change that product.  However, for me, taking Christensen’s advice would probably mean more focus on the circumstances surrounding how my customer uses my lumber and less on the lumber itself.

Christensen’s book certainly challenged me to think about innovation differently

It Was the Best of Times and the Worst of Times

“It was the best of times, it was the worst of times.”  The first sentence from Charles Dickens’ famous novel A Tale of Two Cities captures well the state of the hardwood lumber industry over the last five years.  For most hardwood lumber producers, the last six months have been among the best times that they’ve ever experienced.  And yet, the pain of much of the previous five years remains seared in our memories.  So how do we handle these two radically different images at war in our minds?  As I’ve thought about this, I’ve come up with some advice for myself.  Maybe some of this will work for you.

 

  • There’s an old stockbroker’s saying that goes something like this:  “Don’t confuse brains with a bull market.”  So, in our context, enjoy the good times while they last, but don’t let them convince you that you’re suddenly a lot smarter than you were a year or two ago.  The current runaway market will end sooner or later, and it isn’t our smarts that has created it.  We need to enjoy it while we can, but be ready for it to return to normal.
  • Don’t let rising prices and increasing margins cover up sloppy operations and sales practices.  It’s easy to be lulled to sleep by increasing sales and margins, and not look hard enough at what’s “underneath the covers.”  We need to keep pushing just as hard for the half percent efficiency increase, or the 1% gross margin increase, as we did in the depths of the recession.  It’s just as important now in good times as it was in poor times.
  • Keep investing.  When business is good, there’s a temptation to think that it’s not as important for us to keep investing in our business.  I’m not just talking about equipment, but also about investments in IT and other areas that make our businesses more efficient and cost effective.  Continuing to invest will give us a cost advantage when things turn back to normal.
  • Work harder than ever at getting close to our customers.  The temptation in times like these can be to think “we’re in the drivers’ seat.”  At all cost, don’t give into this temptation.  Suppliers and customers need each other and the pendulum swings back and forth.  Don’t be afraid or embarrassed to raise prices, but travel and work hard to keep strong personal connections and relationships, and don’t present a “take it or leave it” attitude.
  • Proactively look for talent that we can add to our team, whether it’s in production, operations, sales or support functions.  Don’t wait until someone leaves to try to fill a spot.  With our business growing again, we will need more and better talented people.  Try to get ahead of the curve in hiring these people in advance, even if we don’t have a position open for them right now.

 

These are a few thoughts that I remind myself of these days.  Hopefully one or two of them will help you.

Give and Take

At the end of last year I read the book Give and Take by Adam Grant.  Quite simply, it was the best book I’ve read in the last year.  Adam is an interesting guy.  He’s the youngest tenured professor at the University of Pennsylvania Wharton School of Business, and has done research on some really interesting aspects of business.

The book identifies three different kinds of people: Givers, Takers and Matchers.  The definition of each of these groups is what you might expect.  Givers naturally give more than they get, and instinctively act in the interest of others.  Takers like to get more than they give.  And Matchers strive to preserve an equal balance between giving and getting.

The fundamental premise of Grant’s book is that while it takes some time for Givers to build up goodwill and trust, eventually they establish a reputation and relationships that enhance their success.  In fact, research shows that people who help and regularly give their time to their colleagues actually earn more and get more promotions than Takers or Matchers in the long run.  Studies also show that the most productive people are people who give often.

In the middle of the book, things get really interesting.  Grant makes a distinction between “Selfless Givers” and “Otherish Givers”.  He says that when you really analyze Givers you find that they tend to fall at both the top and the bottom of the success ladder, while Takers and Matchers tend to land more in the middle.  So, what’s the difference between Givers who succeed and Givers don’t?  According to Grant, it’s whether or not they can look out for themselves at the same time as they give.

“Selfless Givers” don’t think enough about themselves.  They think only of others, and are prone to end up as doormats.  People take advantage of them.  On the other hand, “Otherish Givers” are both others-oriented and self-oriented.  For me, the most fascinating point Grant makes is that self-interest and others-interest are completely independent motivations; a person can have both at the same time.  These two characteristics are not opposites such that you need to choose one or the other.  In fact, they can complement one another.  Successful Givers care about benefitting others, but they also have ambitious goals for advancing their own interests.  Givers who do both of these things end up being more successful than Takers or Matchers.

Grant’s ideas were very helpful to me personally.  Our stated purpose in our hardwood lumber business at Baillie is “To Help Others Succeed.”  We occasionally get into discussions about whether or not one can take this too far.  In other words, is it possible to be so exclusively focused on others that it hurts your performance?  Grant’s idea that focusing on helping others and advancing your own self-interest are not opposite things, but are actually separate motivations that can both be present at the same time and can actually complement each other, really helped me as I think about our purpose.

If you are able, read this book.  I’m interested in your opinion of Grant’s ideas.

Talent Not Skills

Imagine you are about to interview a candidate for an important role in your organization.  The first order of business is to check out the candidate’s experience, knowledge and skills, right?  Not so fast, according to Marcus Buckingham in his book First, Break All the Rules!.  The key to successful hiring, argues Buckingham, is to focus on talent.  What talent does the candidate have, and what talent does the job require?  Talent is the key to hiring, as well as the key to driving performance.

So what is talent and how do you find it?  Buckingham describes talent as “4 lane highways in your mind that carve your recurrent patterns of thought, feeling and behavior.”  Talents are what you do easily and naturally.  They’re what you’re “wired” to do.  Each person has a unique “mental filter”, and your mental filter is the source of your talent.  When you’re using a talent, you feel smack in the middle of your wheel house.  Clues to a person’s talents are “rapid learning” (what roles does he learn quickly) and “satisfaction” (what situations give her the greatest satisfaction).  Buckingham contends that your talents are set by your mid-teens, and there’s not much chance of changing them.  “People don’t change that much.  Don’t waste time trying to put in what was left out.  Try to draw out what was left in.  That is hard enough.”  In other words, you can’t teach talent.

So what does all this mean?  When you’re interviewing, or thinking about changing an employee’s role, spend most of your time trying to figure out a person’s talents.  Don’t worry so much about her experience or her skills.  You can provide the experience and train for the skills, but good luck trying to develop a person in an area where he has little or no talent.  A person has a “mental wasteland” in an area where he’s not talented, and that won’t change no matter how much experience or training you give him.

Instead, focus ruthlessly on whether a person is a “talent match” for the job, not on whether they are due for a promotion.  Find roles for people that help them play to their talent.  Be willing to pay someone more than their boss if their talent in that role makes them very valuable.  The last thing you want to do is promote them out of a role that is in their talent “sweet spot.”

We’ve tried to follow this path in our hardwood lumber business at Baillie.  We hire our sales people for sales talent, not for lumber experience.  And we move people into new roles based on the best talent match.  But we have a long way to go.  Buckingham’s book has challenged me to start all my “people thinking” with an eye toward talent.  It certainly requires a leader or manager to know his people better.  But done right, it leads to happier people and an organization that performs.

Wait!

The best leaders act quickly and decisively!  Right?  Well, not always, according to Frank Partnoy, author of Wait – the Art and Science of Delay.  In the introduction to this book, Partnoy makes the statement “Given the fast pace of modern life, most of us tend to react too quickly.”  This caught my attention, and made me want to keep reading.

World class athletes have one decisive advantage:  they have faster reaction time.  This allows them to wait until the last possible moment before making a decision.  Take the example of a baseball batter.  From the time the ball leaves the pitcher’s hand until the time the batter hits the ball is typically a second or less.  The faster the batter’s reaction time, the more of this second he can wait and use to make his swing decision.  Waiting that extra fraction of a second makes all the difference in the world.  That extra fraction of a second gives the batter the opportunity to make the best decision about whether to swing, and if he does swing, how to swing.  The same is true of a tennis player returning a serve.  The faster his reaction time, the longer he can wait before he starts the physical motion of his return.  Bottom line, according to Partnoy, is the longer an athlete can delay his decision the better.

So let’s shift into the realm of business leadership.  Imagine a leader in a hardwood lumber company is faced with an issue that requires a decision.  This leader has read and heard about the need for leaders to be decisive, to take charge, to make a decision quickly so that his people will have clarity and certainty.  I think it’s fair to say that these are the cultural norms surrounding a strong business leader.

According to Partnoy, it makes us feel good to make a quick decision, but it typically will not lead to the best decision. Obviously waiting too long to make a decision is also a problem, but Partnoy argues that the most successful leaders do two things.  First, they understand how long they have to make a decision.  This part is critical.  Second, they wait as long as possible to make that decision.  Just as the batter or tennis player gathers more information about the path of the ball the longer he waits, the business leader gathers more information relevant to his decision every hour he waits.  New information emerges, the problem may change, or, in some cases, the problem may even go away.  The urge to act decisively cuts off these opportunities.  Warren Buffet echoes this thought when he says one key to his success as an investor has been delaying decisions.

This book made me think about the business leader I respect the most:  my father.  He is famous for (and gets teased for!) wanting to keep his options open in family situations.  It can be humorous at times.  But in business it’s exactly the same principle that Partnoy is advocating:  wait till the last minute to make your decision.  It keeps your options open the longest, and sometimes even expands your options.

So don’t get me wrong.  Procrastination, or not making a decision that needs to be made, is probably the worst mistake a leader can make.  However, figuring out how much time we have to make a decision, and then using all of it to make the decision, will almost certainly make you a more effective leader.

The Power of Presence

Recently I read an interview with Ursula Burns, CEO of Xerox.  Ursula is an African-American woman, so some of the article dealt with the unique issues she faces in that regard.  However, for me, the most intriguing part of the interview revolved around her comments on the issue of “presence.”

 

In the interview, Ms. Burns talks about going to one of Xerox’s business service centers in Oregon, making a little speech, walking around the office, and just meeting people.  No big deal, right?  Well, about that experience she writes “It’s amazing.  It’s like I am Oprah or somebody really famous.  And they want pictures, and ‘Can you sign this?’  Even to this day, I minimize how much impact presence has.  Right?  Because I take myself for fairly normal.  But when you go someplace, it actually validates for them their importance and their belonging in the company.”

 

Just a month ago I traveled to China and spent a week traveling with our sales people meeting customers.  Although I’m certainly not Ursula Burns, I came away with many of the same feelings that she expressed about presence.  At Baillie, we think of ourselves as a highly entrepreneurial, individualistic hardwood lumber company.  In many ways, each sales person has his or her own business, his or her own customers and mills.  We typically don’t pay much attention to having senior people travel with sales people visiting customers.  I suppose this is good in one sense, in that sales people grow up quickly and have a heightened sense of responsibility and ownership.

 

However, I think the piece of the puzzle that I was missing is what Ursula Burns describes as “the power of presence.”  When I was in China, I was amazed at how meaningful me simply “being there” was for both our sales people and customers.  I’m not trying to show false humility, but like Ursula, I think of myself as fairly normal and can’t really imagine why it would be a big deal for people to spend time with me.  However, in my role as CEO at Baillie, the reality is that it is a big deal, and I need to be more intentional about simply being out there and spending time with sales people and customers.  It really doesn’t make that much difference what I say or do; simply being present is very meaningful, even motivating, to them.

 

I think this principle applies regardless of your position in your organization.  It may apply a little more easily if you’re the CEO or a senior manager, but if you think hard enough I’m sure you can see how it applies regardless of your role in your organization.  If you’re in sales, simply being present with the production or administrative people can make a difference.  It’s not what you say, it’s just validating their importance with your presence.  If you’re a plant manager or middle manager (who tend to be some of the busiest people on the planet), taking a few moments out of your schedule each day to just be present and talk with people about whatever interests them has a huge impact.  If you’re a support person, or even a line worker, the same principle applies.

 

It took me a long time to learn this lesson (probably decades), but traveling to China last month and reading the interview with Ursula Burns recently produced a real “aha” moment for me.  There’s no canned formula or recipe for how you do this; it will take a little thought on your part.  However, I have no doubt that you will improve the morale and the performance in your organization if you spend some time thinking about what the “power of your presence” can mean in your organization.