A Sales Leadership Framework? Absolutely!

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Think back to the day you first were promoted into a sales leadership role. How did you think your life would change? What did you think the job was going to be?   

When my CEO called me to inform me that my goal of running a sales organization was now becoming a reality, it was one of the most exciting accomplishments in my life. I remember the phone call. We had a small team, the VP of Worldwide Sales had just departed, and I was now in charge.  

I had no previous training. There was no leadership enablement program. And sales leadership? Another animal altogether. My schooling on leadership was from watching others and taking what I liked about the approaches from the good ones.  

But what was the job to be done? I know I had a target to hit and a team to get us there. But what did that mean? I’d always had a process and structure in sales. Where was my sales leadership process and structure?   

Gartner defines sales leadership as “the discipline of guiding the strategic direction of the sales function and managing the sales organization to achieve commercial objectives.”  

The discipline of guiding the strategic direction of the sales function? That’s intense…but with what?  

Are you building a team? Maintaining one? Growing one? Motivating one? Leading many, who are led by other leaders?  

Sales leadership structure either doesn’t exist, or it’s so convoluted through psychology and coaching science that it’s missing its responsibility — to achieve commercial objectives.  

The reality of that conundrum became apparent within 48 hours of stepping into my new role. I was immediately transformed into a dog chasing a car down the road, never knowing where it or I was headed. Left turn to a recruiting task. Right turn to a pipeline issue. Another left, but this time it’s down angry customer lane.  

It’s no way to live, and I’m far too much of a systems nerd to survive in such an environment. So I created a structure. It became my way to think through my day, to plan and to strategize. I applied it in my communication to my CEO and board, to my direct reports, and across the organization in all-hands meetings and discussions with peers. 

It’s easy. It’s alliterative. And once internalized, I stopped chasing and started growing. It made me sound smart, too. (I could use all the help I could get).  

I dubbed my framework the Five F’s of Building Revenue Capacity.  

As a revenue leader, everything you’re responsible for falls into one of five categories —initially and ongoing. It doesn’t matter if it’s your first leadership role or twentieth.  

These are the Five F’s of sales leadership: 

1. Focus: You have an initial and ongoing responsibility to ensure your team is using their most valuable resource — their time — in the most effective way possible. That means ensuring the team is working on the right opportunities in the right regions at the right time using the right firmographics, demographics, and pre-requisites. 

2. Field: You have an initial and ongoing responsibility to ensure your field organization is the right one, with the right tools and the right resources, to maximize effectiveness, efficiency and output based on your “Focus.”  

3. Fundamentals: You have to always make sure your team is doing the right things right…consistently. This includes qualification, discovery, positioning, prospecting skills, presentations, negotiations, time management, and so on. 

4. Forecast: You have a responsibility to predict the future by honing your and your organization’s ability to forecast with greater accuracy along with the KPIs (key performance indicators). 

5. Fun: It’s you who creates, cultivates, and grows the culture of your environment so that your team has fun every day and maximizes their intrinsic inspiration for what they do. In a fun culture, they show up each day, stay, do their best, and become advocates for you and your organization. 

While they may sound clever, once you internalize the Five F’s of Building Capacity Revenue you’ll be ahead of 98 percent of the revenue leadership who don’t have a structure. Additionally, you could quite literally create a 30/60/90-day plan using the structure. It can be your agenda for your one-on-ones with your direct reports or your boss. I used it for interviews and interviewing, as an agenda for board meetings, and even as the structure for doing due diligence on potential acquisitions. 

Over the years, I optimized each category through behavioral science, application, and practice. It was my sales and revenue leadership framework. 

You’ll see the holes before they form. You’ll have a consistent language in your organizations. You’ll stand out. 

5 Inspirational ‘Grit in Leadership’ Skills for Overcoming Adversity

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What inspires us to follow a CEO, founder or thought leader? Certainly, there is a toughness, particularly in the face of adversity, that can encourage us to do the same and elevate our efforts.

In other words, toughness or grit can be inspirational. In this short article, I want to share how grit is essential and that it can be developed by anyone who desires to succeed as a leader whether in a small business or a start-up destined to spectacular growth. 

Eight years ago in 2014, I was diagnosed with Stage 4 cancer. This happened at precisely the same time I founded a start-up software company…that we ultimately sold in 2021, and richly rewarded our investors and team. During those eight years, while we grew sales and enhanced the product, I survived seven surgeries, five courses of radiation, and months and months of chemo. I’ve been asked, “How did you do it?” Honestly, I’m not certain looking back. All I know is that I just kept showing up, and that perseverance, as one of my people once told me, “took grit.” 

Grit is an essential character trait for leaders. The question is “Are we born with grit, or is it something we can learn?” Like much else in life, the answer is, some of both. In fact, researchers and philosophers, including Angela Duckworth, William James, K.E Ericson, and Aristotle, would agree with this assessment.  

Let’s start with the word itself…grit. It’s a little hard to define precisely. In fact it’s one of those words, where you know it when you see it… as in, that person has grit.  Here’s the dictionary definition.

Grit:  noun

Indomitable spirit; stubborn courage; brave perseverance; pluck in the face of adversity.

The day I was diagnosed was a day like any other. I was scheduled to get on a flight that afternoon to meet with one of our customers. My wife told me to stay home. But I went despite the way I felt after getting that awful news. As you might imagine, I was reeling with disbelief, fear and anger. But I felt there was work to be done and promises to be kept…so I went.

That first night on the road, unable to sleep, I had time to think about the hell I was about to descend into. I was scared. And in a conversation with myself, I decided that in order to function, deal with the treatments and run the business, I would never open myself to self-pity and ask the question, “Why me?” I decided instead to focus on asking a better question, “What’s next?”…as in, what must I do next to survive?

It’s easy to indulge in “why me” thinking when adversity, especially undeserved adversity, strikes. But the only thing “why me” thinking produces is a sense of victimization that leads to unfocused action and decision-making. And that becomes contagious as people can see it and feel it. On the other hand, “what’s next” thinking promotes focus, clarity, courage, hope and action. It takes grit to deal with adversity. And leaders who respond that way encourage others to act likewise, and inspire them to challenge themselves and become part of the solution.  Specifically, many might say; “Heck if he can pull himself together and come to work, then why can’t I?” And this happens. I know it does because I watched this exact process happen in my company, with my people. We grew closer, more focused, and everyone worked harder. 

So, what can any of us do to develop grit so we can exercise when adversity strikes – especially during early and start-up stage businesses?

Best Practices for “Grit in Leadership”

I was surprised when searching online for “grit in leadership” that the topic attracted a good deal of thinking by researchers. In general, the research identified five traits that were practiced by “gritty” people. What was also clear, as I discovered, is a direct causal connection between these traits and inspirational leadership as experienced by everyone on a team. The five characteristics of grit below are based on Character Lab Founder Angela Duckworth’s findings and her book “Grit: The Power of Passion and Perseverance,” along with others.

  1. Resilience: One of the most important characteristics of grit for inspirational leaders is the ability to act and communicate with optimism, creativity, and confidence despite setbacks. This attribute helps empower others to “keep the faith” and stand up under performance pressures.
  1. Courage: Another chief predictor of leadership success is the ability to manage fear of failure. Inspirational leaders seem to have a clear understanding of the upside and downside risks of decisions. This calculus enables them to be decisive and act despite the risks.
  1. Conscientiousness: Tenacity and the ability to work tirelessly by focusing on doing a good job and completing the tasks at hand is another hallmark of inspirational leaders. This work ethic and determination appear to be contagious in followers.
  1. Perseverance: The ability to demonstrate and maintain intensity, direction, and the duration of one’s exertions in the pursuit a long-term goal is an essential element of grit, and has the effect of building team spirit, pride and fellowship. 
  1. Excellence: Gritty people don’t seek perfection; they instead strive for excellence. This approach favors a bias action versus getting stuck in over-analysis. One of my favorite sayings that I often repeated to my people was…“Perfection is the enemy of the good.”

Adversity is a constant. So to help others understand how to develop grit as a leader, I’ve documented my personal and business experiences, lessons learned and success tips in my recently published book, “One Hit Wonder: The Real-Life Adventures of an Average Guy and the Lessons He Learned Along the Way.”

The way leaders respond to adversity and pressure can either be a source of inspiration that drives success, or become a breeding ground for fear and uncertainty. And while entrepreneurs and managers can’t control what happens as they start and grow a business; they can control the way they act and lead from the front. 

Does Remote Work Contribute to Inflation? Let’s Look at the Numbers

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BlackRock CEO Larry Fink claimed in a recent interview with Fox that “we have to get our employees back in the office.” According to him, doing so would result in “rising productivity that will offset some of the inflationary pressures.” 

Fink did not provide any data in the form of statistics, surveys, or studies to support his claims. He insisted, without evidence, that in-office work would reduce inflation. So what does the data say?

A widely-cited July 2022 study from the highly-respected National Bureau of Economic Research (NBER) found strong evidence that remote work decreased inflation. Namely, because employees strongly prefer mostly or full-time remote work, they are willing to accept lower wages to work remotely. As a result, the researchers found that remote work decreased wage growth by 2 percent over the last two years. Notably, the decrease in growth occurred specifically in the mostly higher-paid, white-collar positions that could be done remotely, leading to wage compression that reduced wage inequality between blue-collar and white-collar work. Given that higher wages result in more consumer spending, leading to inflation, the study concluded that remote work reduces inflation.

Plenty of other evidence supports the finding that remote work reduces wage growth, such as a June 2022 survey by the Society for Human Resources. It reports that 48% of survey respondents will “definitely” look for a full-time WFH job in their next search. To get them to stay at a full-time position with a 30-minute commute, they would need a 20% pay raise. A hybrid job with the same commute would need a pay raise of 10%. A different survey of 3,000 workers at top companies such as Google, Amazon, and Microsoft found that 64% would prefer permanent work-from-home over a $30,000 pay raise. Indeed, companies that offer remote work opportunities are increasingly hiring in lower cost-of-living areas of the US and even outside the US to get the best value for talent. That’s a significant reason why one of my clients, a late-stage software-as-a-service startup, decided to offer some all-remote positions. 

This data shows that remote work decreases costs of labor and thus reduces inflation. What about Fink’s claims about productivity?

Surveys have long found that workers report being more productive working remotely, but we might feel some skepticism toward self-reported answers. It’s harder to feel skeptical of evidence from employee monitoring softwarecompany Prodoscore. Its President David Powell said, “after evaluating over 105 million data points from 30,000 U.S.-based Prodoscore users, we discovered a five percent increase in productivity during the pandemic work-from-home period.” 

And we have become better at working remotely over time. A Stanford University study found that remote workers were 5% more productive than in-office workers in the summer of 2020. By the spring of 2022, remote workers became 9% more productive, since companies learned how to do remote work better and invested in more remote-friendly technology. 

A July 2022 study in another NBER paper found that productivity growth in businesses relying on remote work like IT and finance grew from 1.1% between 2010 and 2019 to 3.3% since the start of the pandemic. Compare that to industries relying on in-person contact, such as transportation, dining, and hospitality. They went from a productivity growth of 0.6% between 2010 and 2019 to a decrease of 2.6% from the pandemic’s start.

Case study evidence backs up these broader trends, as reported in another NBER paper about a study at a real-world company, Trip.com, one of the largest travel agencies in the world. It randomly assigned some engineers, marketing workers, and finance workers to work some of their time remotely and others in the same roles to full-time in-office work. Guess what? Those who worked on a hybrid schedule had 35% better retention, and the engineers wrote 8% more code. Writing code is a standardized and tough measure of productivity and provides strong evidence of higher productivity in remote work.

The evidence demonstrates that remote labor costs less and is more productive, reducing inflation at both ends. What about ancillary costs?

Employees can save much money, up to $12,000, for full-time remote work, according to a Flexjobs analysis. That involves savings on transportation, such as gas, car maintenance, parking, or public transport. Workers also don’t have to buy expensive office attire or eat out at overpriced downtown restaurants. Workers need to pay somewhat more for cooking at home and higher utilities. Yet these costs are much smaller than the costs of coming to the office.

Companies save much money on real estate, utilities, office furniture, cleaning services, and related costs. An average office space per employee can be up to $18,000 annually, which means savings can add up fast. No wonder office occupancy is down, and companies are cutting their real estate footprint. For example, Amazon – which allows full-time and part-time remote work – recently paused its construction of five towers in Bellevue, Washington, due to remote work. 

Companies are investing more into support for work from home, such as IT and cybersecurity. And more forward-looking ones are providing remote work support for home offices. For instance, Twitter, Facebook, and Google provided a flat stipend of $1,000 for home offices. As another alternative, one of my clients, the University of Southern California’s Information Sciences Institute, researched the best options for home offices and provided a standardized and wide range of home office technology and furniture to its staff. Doing so improves productivity and is a wise long-term investment. And such expenses are much less than the costs of employees in the office. 

Thus, in addition to lower labor costs and higher productivity, employees and employers pay much less to have staff work remotely. All the evidence shows that remote work decreases inflation. 

Such information is readily available, and Fink could have assigned a summer intern at BlackRock to find the evidence but chose not to do so. He’s not the only one joining many prominent CEOs in driving employees back to the office. What explains this seemingly contradictory behavior?

As a behavioral science expert in decision-making around the future of work, I can tell you that I’ve observed many leaders exhibiting poor judgment, likely due to a combination of cognitive biases. One is called the belief bias, where our belief in the desirability of an outcome – such as Fink’s desire for workers to return to the office – causes us to misinterpret the evidence supporting this outcome. Another is confirmation bias, where we look for evidence that confirms our beliefs and ignores evidence that does not. 

Thus, while the facts clearly show that remote work reduces inflation, improves productivity, and reduces costs, it took many efforts to convince some traditionalist executives within my client organizations about the benefits of remote work. Their discomfort – due to these cognitive biases – undermined their judgments. It discussed cognitive biases and how to avoid trusting our intuitions in new contexts to turn them around.

Hopefully, prominent CEOs like Larry Fink and many others will recognize the dangerous consequences of inflation and the bottom lines of their companies driving employees back to the office. Otherwise, their companies and the economy as a whole will suffer. Their poor judgment should teach all business leaders to rely on facts and not wishful thinking in their public communication and decision-making.

Why This Disgusting Job Has One of the Highest Retention Rates

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Yes, that Roto-Rooter! (I promise, this relates to hiring)

Recently, I had this company fix a clogged sewer line. Luckily, the problem was small, but the repair people reminded me of a valuable lesson.

While their machine was working, I asked the two Roto Rooter employees: “So, how long have you worked for the company?” Their answer floored me. One of the remote employees had worked for them for 18 years, and the other for 12. They were intelligent, professional, and capable individuals who had spent years making their living unclogging drains.

Most people would not want their jobs. Yet, these two men were proud to be working for their company. I asked: “What makes this company so special?” During our conversation over the next 10 – 15 minutes, this is what I learned:

  • The General Manager is honest, capable, employee focused and fair.
  • The company gives them the tools and the training they need to be successful.
  • The company communicates effectively and includes them in the company functions.
  • The pay and benefits are good.
  • The company keeps their service vans and equipment in good shape.
  • The company cares about them and respects their efforts.

I called the General Manager to congratulate him for having a work environment that the remote employees were proud of. We talked for several minutes and then, I asked, “where do you get your new employees?” Without hesitation he said: “Almost 100% are referrals from our current employees.”

Unclogging drains is a dirty, smelly job with long hours and difficult weather situations. But Roto-Rooter in St Louis retains good people because they focus on doing the right things. They treat their employees with respect. The net result – a growing, profitable company with low turnover, an engaged workforce and good customer service.

Today’s employees are saying: “Validate me as a person or lose me as an employee.” Do you have a turnover problem?

What Can Business Leaders Learn From What Government Does Right?

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Whether people want more government or less government, they all want efficient government. Unfortunately, public-sector organizations are generally not known for their operational excellence. The natural question arises: By their nature, do government operations have to be inefficient?

In 2015, we became aware of a small but growing number of public-sector organizations that had dramatically improved their performance—and in a relatively short time. We were intrigued and started to visit them and look into what they were doing. This was the beginning of a six-year study that culminated in our book Practical Innovation in Government.

Throughout our careers, our work has centered on how to create high-performance organizations. Until recently, this meant we studied and worked primarily with private-sector companies. But as we identified and visited more high-performing public-sector organizations, it became clear they had developed approaches to continuous improvement that were proving astonishingly effective in a government setting. In fact, some of these organizations had attained levels of efficiency and service that rivaled the best private-sector companies anywhere.

A case study: Denver’s Department of Excise and Licensing

Consider what happened at Denver’s Department of Excise and Licensing. In 2013, it was the city’s “problem” department and a huge headache for the mayor’s office. The department had 39 employees who issued some 48,000 licenses each year. There were approximately 80 different types of licenses, most of which had to be renewed annually. These included everything from individual licenses for taxi drivers and security guards to business licenses for restaurants and liquor stores.

When a new manager, Stacie Loucks, took over, she found that average wait times were running an hour and 40 minutes, with peak wait times of five to six hours. The lobby was often jammed so full that the air conditioners couldn’t keep up and the temperature climbed into the mid-80s.

But in just two years, Stacie transformed Denver Licensing into a showcase department. Wait times dropped to seven minutes and then were all but eliminated, despite a doubling in the volume of licenses issued, due primarily to the city’s booming economy. And despite the dramatic increase in license volume, Loucks was the only department head in the city government who didn’t ask for more staff or resources in the next budgeting cycle.

A surprising study finding

We found numerous examples like these across a diverse set of government operations. After being a severe bottleneck to state patrol operations, and the subject of the largest number of trooper complaints, the Washington State Police garage went on a multiyear improvement effort. In that time, it tripled its productivity and became a national benchmark for other states’ police garages. Similarly, a K-8 school in New Brunswick, Canada, boosted the percentage of students reading at the appropriate age level from 22% to 78%.

Our study ended up taking us to 77 organizations in 5 countries and involved interviews with more than 1,000 people.

What we found was surprising. The high performers were achieving their impressive levels of efficiency and service in an unexpected way. We had expected to find most improvement being driven in a top-down fashion, perhaps by middle-level managers or professional staff, as it generally is in the business world. Although we did find plenty of examples of top-driven programs, invariably, they were all marginal or low performers.

The highest-performing improvement efforts we encountered were quite different. What stood out was that in every single one of them, the lion’s share of the improvement activity was taking place on the front lines. The primary champions of change were low-level managers and supervisors.

Like Stacie Loucks at Denver Licensing, they had created units with strong local cultures of improvement. Bit by bit, through large numbers of small, highly targeted ideas, their units relentlessly increased performance. These front-line leaders, not their higher-level managers,were the real heroes of their organizations’ innovation stories.

Front-line–driven improvement is uniquely suited for government

The more we studied this front-line–driven improvement, the more we realized how uniquely suited it is to a government environment. Improving efficiency, it turns out, is one area where public sector leaders should definitely not follow conventional business practices.

In the private sector, changes are generally less complicated to execute. If top or middle managers want to make a change, they usually have the power to do so. But government is not a business. When government managers want to create change, they typically face a host of political, regulatory, and bureaucratic hurdles that can make the process painfully slow, inordinately time-consuming, and even professionally risky.

Although the front-line ideas implemented by the high performers in our study were generally small and inexpensive, they had a huge impact cumulatively. (Think back to Denver Licensing, which completely eliminated its long lines.) At the same time, each individualidea went largely unnoticed by customers, colleagues from other departments, and higher-level managers. In short, they were invisible to outsiders.

The leaders in these government organizations have figured out two things. First, without the countervailing forces faced by higher-level managers, front-line leaders and staff can implement large numbers of improvements with little interference. And when ideas do need to involve other functions, front-line leaders can often work directly with their counterparts in other departments to get them done.

Second, in spite of being so small that they are “under the radar,” front-line ideas are an amazingly powerful source of improvement. Research has shown that some 80% of any organization’s improvement potential lies in the creativity and initiative of its front-line staff.When it became clear to us that the dominant factor distinguishing the high performers in our study was front-line–driven improvement, we were surprised, yet not surprised. Surprised, because we were simply not expecting to see its singular importance in the government context. Not surprised, because in the rare cases of true front-line driven improvement in the private sector, it also produces extremely high rates of performance improvement. The problem in most private-sector organizations is that managers make little or no use of this potential.

The takeaway

So, the answer to our opening question is, “No, government doesn’t have to be inefficient. In fact, it can be very efficient. But it won’t get there by following traditional business practices.”

Gen Z Demands Change in the Workplace. What Should Brands (and Employers) Keep in Mind?

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From mental health benefits to stricter work-life boundaries, Gen Zers are changing the definition of a thriving workplace and demanding change at all levels of an organization.

Gen Z is a generation of unique thinkers who have changed how we live, work, and shop. Not only do they demand and expect their beloved brands to be socially and environmentally conscious, but they also insist on working for companies who are purposeful in advocating for ESG. As they enter the workforce, Gen Zers seek companies that demonstrate the same values they hold dear and are not afraid to hold them accountable when they don’t. 

According to a Deloitte report, 49% of Gen Zers said they made choices regarding the type of work they will do and the companies they are willing to work for based on their values and ethics.

As a very individualistic generation, Gen Zers are finding their own ways to move the needle for their generation and those to follow, including delegating to senior team members, asking for mental health days, establishing more work/life balance, and setting their own hours for more flexibility. For this group, championing change is non-negotiable. So how can businesses support this growing workforce to attract and retain talent? Below are five ways that Gen Z employees are demanding change in the workplace:

This group is hyper-aware of empty brand missions

According to data from Knit, only 25% of Gen Zers think brands are genuine in their efforts to make the world a better place. Organizations can no longer get by on surface attempts to appear authentic on social issues when an entire generation of workers won’t hesitate to call them out. As true digital natives, Gen Zers are more sophisticated and critical consumers of media than any generation before them. That means being hyper-aware of empty brand missions, greenwashing, and false company promises. Knit data also cites nearly a third of this generation has canceled a brand due to a recent marketing campaign, ad, or brand affiliation in the past. Unfortunately, the majority of Gen Zers don’t have faith that businesses are having a positive impact on the world. This group is unafraid to challenge the status quo and call companies out on unethical business practices. Businesses that implement authentic initiatives to narrow the gender wage gap, improve wealth inequality, dedicate resources to the mental well-being of employees and genuinely support environmental initiatives will draw the attention of young talent. 

Mental health initiatives are the norm, not a bonus

According to McKinsey, Gen Z is one generation more likely to report having been diagnosed with or struggling with a mental health condition than Gen Xers or Baby Boomers. Deloitte reported 46% of Gen Zers claimed to be stressed or anxious most of the time and cited the intense demands of their work environments as their primary reason for burnout. It is an epidemic, and this group is more likely to seek support and treatment than others in the past and recognizes the importance of self-care and support. That includes being prepared to walk away from a current job if these needs aren’t being met. This poses a significant retention problem for employers, with Knit reporting that 63% of Gen Z employees expect their employer to offer mental health benefits second only to a 401K. Employers will lose out if they don’t seriously consider developing safe, secure environments with strategies to help support mental and emotional well-being.

A bold, in-your-face approach to DE&I

This group demands a more transparent DE&I strategy and practices. They look beyond the next cubicle and into the highest board rooms for representation and understanding and have zero fear in holding those in charge accountable. The Gen Z generation is already a very diverse group and demands employers to be a progressive tool for social change. This includes not just hiring a diverse workforce but creating clear paths for promotions, professional development, and more for all employees equally. A well-crafted DE&I agenda must go beyond celebrating or acknowledging important dates and address systemic inequalities at the foundation. This will keep young employees engaged in the business and the company’s growth but will lead to more innovation, a positive work environment, and more revenue. In fact, according to McKinsey & Company, companies with more gender diversity were 21% more likely to experience more profitability than industry competitors, and those that were more culturally and ethnically diverse were 33% more likely to outperform. 

Commitment to work-life balance

According to the Deloitte report, 75% of Gen Z employees prefer hybrid or remote work. Flexible work often offers opportunities to save more free time for loved ones. It can positively impact mental health, which we know is a significant factor in deciding where to work. This group understands that work is often just a paycheck; that their well-being and work-life balance are necessary. A Microsoft study indicated that Gen Zers are leaving jobs over well-being and mental health, lack of work-life balance, and a lack of flexibility almost equally. Work-life balance can look different to each employee, and leading companies understand this. They offer various options, from flexible hours or remote work to unlimited vacation time to support this balance.

Gen Z inspires organizations to rethink workplace norms with their call to address mental health, work flexibility, learning and development opportunities, and a greater commitment from companies to implement ESG initiatives for a more positive impact on the world. Employers can attract and retain talent in the younger generations by aligning with these values, listening to their needs, and allowing Gen Z employees to have a seat at the table to discuss what matters in their work environments. In nurturing Gen Z employee relations, businesses can generate a more positive work environment, promote innovation, contribute to improved mental health and well-being, and, as a result, stands to claim a more significant market share. 

Carry These 21 Leadership Characteristics in Your Pocket at All Times

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If you started your company today, would you hire everyone currently on your payroll?

Your hiring managers and supervisors are the gatekeepers to your company’s future. So, how can you give them the “keys” to be successful  — focus, ownership, accountability, and continuous improvement?

One way to help is getting everyone on the same page.   

For example: developing a list of three to five overall employee characteristics you need to fulfill your Mission Statement. Then, those characteristics are in front of every hiring manager for every interview and are included on the interview evaluation form.  Do your candidates match the characteristics you need to reach your goals?

21 Sample employee characteristics (choose 3 – 5)

IntegrityReliable PersistencePassionateAmbitious
Team playerSelf-starterLeaderIndependentInstills trust
HappyFocusedInspires othersProblem solverFlexible
Effective communicatorPositive attitudeSeeks improvementResults orientedStrong work ethic
Achieves goals

The idea above came from the CEO of a remarkably successful construction company. Once the company had established its five characteristics, he had the list laminated and carries it in his pocket every day.  When visiting the company’s branches around the US, he talks with the managers about this list, which is always at hand.

Climate, Capital & ESG: The True Intersection of Impact

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This summer, we have seen a historic and deadly heat wave scorch western Europe, killing thousands, fueling wildfires, melting airport runways, and shuttering businesses. 

Earlier this year, a record-shattering heat wave in India reduced wheat yields, straining the balance between domestic needs and ambitions to increase exports to make up for shortfalls caused by Russia’s war against Ukraine. Ultimately, India, the second-largest producer of wheat globally, placed a temporary ban on wheat exports, compounding the global food crisis and Europe’s current crop devastation. 

In today’s interdependent world, there is no doubt that one of the greatest threats to our global and local economies is climate change. A 2022 Deloitte report found that climate inaction would cost the US economy $14.5 trillion by 2070. The same economy stands to gain $3 trillion over the next 50 years if it accelerates towards low-emissions growth. Furthermore, a World Bank report estimated that an additional 68 to 135 million people could be pushed into poverty by 2030 due to climate change, conflict, and the pandemic. 

With their vast influence and resources, corporations and financial institutions have the power to help solve these issues on a massive scale. However, this will require new, creative solutions, because the rules and referees who have got us here will not get us to where we need to go. With a $5 trillion price tag to achieve the UN Sustainable Development Goals, investors and philanthropists must adopt a more radically disruptive stance in their investment and philanthropy decisions.

This is where Environmental, Social, and Governance (ESG) investing (or sustainable investing) comes into play. Companies like IKEA, Chobani, Etsy, and Ecolab are already showing us what is possible when sustainability and purpose are prioritized. These priorities needn’t be at odds with profitability if we shift our mindset from short-term gains to long-term sustainability. Study after study shows that when companies create value for people and planet, they create higher value for themselves and shareholders.

From healthcare to renewable energy and water, the number of highly innovative, impactful businesses demonstrating this potential is growing annually, and generating attractive, long-term financial and social returns. From women-led startups to diverse businesses across emerging economies, these are enterprises with promising growth trajectories, and a unique ability to reach low-income consumers in emerging markets (where 85% of the world lives).

When creative solutions seem to be our best chance forward, why are we not hearing more about these investment opportunities among traditional finance circles? The answer: the financial industry continues to vet, reward, and undertake due diligence with the same lens that aligned with where the world was decades ago. Unsurprisingly, this is not in line with where we are today. 

For ESG investing to reach its full potential, we must move from passive divestments and screenings to proactive investments in impact investment funds and businesses that intentionally generate value for all. This intersection between ESG and impact investing is where there is the greatest opportunity to steer more capital towards people, organizations, and social innovations creating a prosperous future. This includes investing in diverse leadership teams and ethical supply chains; in new global standards around disclosures and reporting; and in financial risk analyses that factor in the cost of climate inaction. This is ESG 2.0.

Companies like Lebec Consulting, which are helping maximize impact for philanthropists, impact investors, and profitable business models and social enterprises, consistently see strong performance for portfolios that integrate key ESG factors. These businesses are demonstrating that purpose can generate long-term value and profitability. Many have unconventional structures, are led by social entrepreneurs in emerging markets (including women) and in the US, and leverage patient philanthropic and impact investment capital to expand their reach.

Acumen, a leader in this space with a 20-year track record, has reimagined venture financing and invested in innovative business models that create products and services for millions of underserved communities. Many of the early stage businesses Acumen invests in have gone on to scale and attract additional institutional investment, enabling millions of people to gain access to financial services in the US, and key renewable off-grid energy products in countries across Africa. Many of the businesses Acumen invests in are leading the clean energy transition. In total, Acumen has leveraged flexible philanthropic capital to invest over $150 million in 151 companies overlooked by traditional investors, reaching over 380 million people living in poverty and generating long-term social and financial returns.

Similarly, investors have failed to capitalize on global healthcare despite unending rhetoric from global leaders regarding the need to strengthen our interconnected health systems. The overwhelming majority of healthcare investments made in the last two years have been in the US and other advanced economies, with limited commitments to emerging markets where compelling business models are meeting tremendous demand. 

In Bangladesh, for instance, female-founded Praava Health achieved unit level profitability within its first year of operations with a business model that leverages technology, local and international healthcare value chains, government and private sector leadership, and a click-and-brick healthcare platform that has already delivered high quality healthcare to nearly 400,000 patients across Bangladesh. Despite these milestones, it has yet to attract institutional capital.

Betting on companies and investors like the ones mentioned here is not only a feel-good endeavor – it’s better for investors’ bottom lines in the long run, even if holding periods may be longer. Naysayers argue that high profitability will always win the day over purpose due to the design of our capitalist system. To that we say: let’s change the system and invest in opportunities that are adamant about creating impact and financial performance in places where traditional capital has failed to see opportunity. 

It’s time for new rules, new referees, and new players. Is your head in the game?

 
Lebec Consulting is a women-owned and women-led firm that advises corporations, foundations, high net-worth individuals, financial institutions, and entrepreneurs on how to achieve their greatest social impact through philanthropy; impact investing; and environmental, social, and governance (ESG) investing.

Our Belongingness Crisis: How We Organize Ourselves at Work

Posted on by Real Leaders

What do you think is the primary driver of people at work? The conventional wisdom is that it’s either their hopes for the trappings of promotion—more money, status, vacation time, maybe a parking spot—or their need for self-efficacy, creativity, and self-actualization.

I’ve asked this and other related questions to over six hundred people in a wide range of companies and organizations ranging from Fortune 100 companies, police departments, and psychology clinics to small businesses and nonprofits.

The interviews I’ve conducted have led me to a surprising revelation about our deepest motivations at work. The people I’ve spoken with in-depth about what wakes them up in the morning and propels them into an office, hospital, art studio, or sports arena do not show any of the above as the primary drivers of their intrinsic motivation.

Not So Fast

What, then, is the ultimate motivation for most people at work? Just as a vast trove of psychological research converges on our social relationships as the most critical ingredient of our long-term well-being, the primary motivations of the hundreds of people I’ve interviewed are social. 

The primary reason people join and stay in a company or organization is not that they want to earn more money and possess a high status (although they enjoy both) but because they wish to belong. Their deepest intrinsic desire they want to fulfill at work is to feel included, accepted, appreciated, and valued by a social group that, in their eyes, is worth belonging to.

An operations manager in a retail company described what it feels like not to experience this belongingness. “I felt alone because my boss had favoritism and spent much time outside the office with the sales manager. This caused unfair treatment and made me feel excluded.”

What does such treatment at work lead to at home? A sales associate in a biotech company told me how the failure of leaders to help her feel like she belongs and is appreciated could affect life outside of the office: 

It’s that isolation. It’s excruciating – that loneliness, that feeling of not belonging … It’s affecting every part of my life. It is because I go home and I’m like…I don’t do anything … I sit there, sad and depressed, and my kids will try to say, “Mom, let’s go here. Let’s do this.” And I say, ‘No, you guys go. Here’s some money, and I’ll be here.’

The need to belong plumbs the depth of our composition as human beings. A recent study found that a lack of belonging (in other words, ostracism), like for this sales associate, disables essential elements of psychological functioning, including a sense of meaningfulness in life. 

Believe it or not, even feeling rejected by a social group one despises—in another study, participants were manipulated into believing the KKK was ostracizing them—can be hurtful.

The Real Way We Organize Ourselves at Work

Researching and teaching leadership for over thirty years has led me to believe that the organizational chart that best reifies how organizations truly operate contains the CEO in a circle in the middle. Inches away in all directions are other circles—the people the CEO most trusts. Fanning outwards into other circles are the people they trust. 

Leaders play a critical role in helping people experience this sense of belonging. The security of the people you lead hinges on this feeling of being central to and valued by the social network that is the organization. 

Bring It Home

How can you foster this feeling of belongingness in the people you manage or lead? Here are three strategies that, based on my research, are worth giving a shot.

Scale kindness. The simple act of being kind and empathetic toward people is the first step. A lack of genuine caring is like air—you don’t notice it when it’s there every day, yet when it’s gone, it’s all you see.

A software engineer (yes, they have feelings, too) shared with me, “What reduced my feeling of belonging was [the senior leaders] not saying hello to you. Not making eye contact with you or having any small talk or discussions. The only communication you had was something that was demanding, like ‘I need this or ‘You need to do this.’ 

Facilitate opportunities for social connection. While enabling your team members to feel like they belong begins with common courtesy, that’s not where it ends. Bring them together in meaningful ways, whether brainstorming for a new project, hiking together, playing softball, or having a picnic. 

Bring people back to the office as soon and safely as you can. Now that social distancing measures are softening, it’s time to safely—and resolutely—rebuild the social connections people need to feel they are necessary—and belong—in your organization.

Will a Return to the Office Harm Diversity or Improve it?

Posted on by Real Leaders

JPMorgan CEO Jamie Dimon recently claimed that returning to the office will help improve diversity. And if he’s right, that’s an important argument for office-centric work. After all, extensive research shows that improving diversity boosts both decision-making and financial performance. 

Yet does office-centric work really improve diversity? Meta Platforms – the owner of Facebook and Instagram – decided to offer permanent fully-remote work options to its current employees and new job applicants as part of adapting to the post-pandemic environment. If Dimon is right, this shift should have undermined Meta’s diversity. 

In fact, Meta found the opposite to be true. According to Meta Chief Diversity Officer Maxine Williams, the candidates who accepted job offers for remote positions were “substantially more likely” to come from diverse communities: Black, Hispanic, Alaskan Native, Native American, people with disabilities, veterans, and women. Sandra Altiné, Meta’s VP of Workforce Diversity and Inclusion, said “embracing remote work and being distributed-first has allowed Meta to become a more diverse company.”

The numbers bear out these claims. In 2019, so before the pandemic, Meta committed to a five-year goal of doubling the number of Black and Hispanic workers in the US and the number of women in its global workforce. Frankly speaking, large companies usually tend to make bold promises, but underperform in executing on these commitments.

However – thanks to remote work – Meta’s 2022 Diversity Report shows that it attained and even outperformed its 2019 five-year goals for diversity two years ahead of its original plans. It substantially improved on other diversity metrics to which it didn’t commit in 2019: for instance, people with disabilities increased from 4.7% to 6.2% of Meta’s employees. 

Is Meta special in some way? Not at all. 

Do you think minority groups, such as African Americans, want more or less time in the office compared to white people? A Future Forum survey on this topic among knowledge workers – who can work fully remotely – found that 21% of all White knowledge workers wanted a return to full-time in-office work. 

What would be your guess as to how many Black knowledge workers wanted a return to full-time in-office work? The answer: only 3% of all Black knowledge workers would want to return to full-time work in the office. That’s a huge difference!

Another survey found that 38% of Black men and 33% of Black women wanted a fully flexible schedule. The comparable numbers for white men is 26% and white women is 25%. 

Plenty of other surveys show similar findings. For example, the Society for Human Resource Management last September found that half of all Black office workers wanted to work from home permanently, while only 39% of white workers did so.

What explains this enormous disparity? Well, unfortunately, Black professionals are still subject to discrimination and microaggressions in the office. They are less vulnerable to such issues when they work remotely much or all of the time.

In addition, Black professionals have to expend more effort to fit into the dominant cultural modality in the workplace, which is determined by traditional White culture. They have to do what is called code-switching: adjusting their style of speech, appearance, and behavior. That code-switching takes energy that could be spent better doing actual productive work.

Similar findings apply to other underprivileged groups. That includes not only ethnic and racial minorities or people with disabilities, but also women.

Since this data is widely available, why did Dimon make the false claim about returning to the office improving diversity? He might have fallen for the belief bias, a mental blindspot that causes us to evaluate truth claims based on how much we want to believe them, rather than the data. Another problem might be the confirmation bias, our mind’s tendency to reject information that goes against our beliefs.

While Dimon is absolutely wrong about diversity and remote work, that doesn’t mean it’s a panacea for underprivileged groups. Research shows minorities deal with bullying on video calls and harassment via chat and email, as well as other online settings. Another problem: surveys demonstrate that men frequently interrupt or ignore women in virtual meetings, even more so than at in-person ones.

How do you address such problems? Companies need to train staff – and especially managers – to conduct remote and hybrid meetings in a way that’s sensitive to diversity concerns. This will help your team build skills in avoiding such problems and especially help minorities feel supported as you build a more collaborative atmosphere.

For example, when bullying and interruptions happen in virtual meetings, managers need to learn how to address it in the moment. They can say something like, “Please let them complete their point before asking questions. Use the raised hand function so that we can come back to your suggestion afterward.” Similarly, managers also need to check with underrepresented staff about bullying in private team member communications, making it clear that any such behavior should be brought to their attention. In both cases, the manager needs to be trained to talk to the offender, explain why it’s inappropriate, and request that they change that pattern of behavior.

Stopping online harassment of minorities is not enough. One of the biggest challenges in remote work is decreasing connections among workers. 

For instance, research indicates that the number of connections made by new hires in the workplace decreased by 17% during the pandemic, compared to the period before the pandemic. Since the successful accomplishment of company goals often requires cross-functional collaboration, such loss of connections is worrisome. Fortunately, scholars found that connecting junior staff working remotely to senior staff during the pandemic worked very effectively to expand the network of junior staff. 

Research shows that one of the primary reasons minorities fail to advance stems from the lack of connections to senior staff in the form of informal mentoring and sponsorship. To address this program requires creating a formal hybrid and remote mentoring program, with a special focus on underprivileged staff. 

As an example, consider one of my clients, the University of Southern California’s Information Sciences Institute, which carries out basic and applied research in machine learning and artificial intelligence, networks and cybersecurity, high-performance computing, microelectronics, and quantum information systems. At ISI, we are implementing a formal mentoring program that will provide special support to minority groups. That means providing minority staff with two mentors, one from the same minority group and one representing the majority population. Doing so offers the minority mentee a diverse network of connections and experiences to draw on among both minority and majority staff. It provides mentees with the implicit knowledge and relationships they will need to advance, while the fact that each mentee has two mentors lightens the load on each mentor and makes the workload manageable. To help uplift the importance of the mentoring program, mentoring is included as part of the performance evaluation of each mentor. 

Creating a diverse, inclusive, and equitable culture in remote and hybrid settings requires recognizing problems and taking action to remedy them. An easy way to start advocating is to conduct internal surveys to determine those issues.

The best surveys will ask minority staff about their experiences with the problems outlined above and other diversity-related challenges. They’ll also request feedback about what the staff believe might be the most effective ways of solving these problems. Then, they’ll integrate the best solutions into plans to address the situation.

You have probably heard the famous phrase, “what gets measured gets managed.” Once you know the nature and extent of the problems, you can work to change them systematically, rather than only in one-off, ad-hoc situations. Measure the problem, create a plan to fix it, then measure how well you are improving it.

By following this path, and adopting best practices for diversity in hybrid and remote work, you’ll avoid Dimon’s failure to look at the data and patently false statements. Instead, like Meta, you’ll outperform your diversity goals and thus improve your company’s financial performance.

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