The following is an excerpt from an article by CEO Advantage advisor Ellen Bryson. The full article is scheduled to appear in the upcoming 4th edition of The CEO Advantage Journal.
While there is no “right” purpose, I suspect there is a wrong one: financial performance. When growth becomes your purpose, trouble is not far away. McDonald’s discovered this in the late 1990s when they shifted their focus from “QSCV” (quality, service, cleanliness, and value) to building more restaurants. By early 2000, McDonald’s had more than 28,000 restaurants with annual revenues in excess of $15 billion. Two years later, they experienced their first quarterly loss since 1954.
Starbucks had a similar experience. In Onward: How Starbucks Fought for Its Life without Losing Its Soul, Howard Schultz shares how Starbucks lost its focus. In effect, growth became their purpose. Schultz says that financial growth is not a strategy; it’s a tactic. He admits that when Starbucks began pursuing undisciplined growth as a strategy, their culture crumbled and they lost their way. Ironically, the financial performance they were pursuing eluded them when it became their chief focus.
…In their book The Discipline of Market Leaders, Michael Treacy and Fred Wiersema talk about three distinct operational models: customer intimacy, innovation, and operational excellence. In my experience as an advisor to CEOs and executive teams, I have seen each of these manifested as the driving force of culture. I have never seen a thriving company with a culture centered on its own financial performance ahead of serving the customer. Is financial performance important? Of course! But it is the result, not the cause, of serving customers well.
Reminders of simple, practical disciplines for leaders who strive to build great organizations.
Talent by the Slice
Monday, October 31st, 2011 by Troy SchrockIn our current business environment, businesses face mounting pressure to master a broad range of specialized knowledge in order to succeed. Such knowledge is not limited to the specific technical areas in which they deliver their services; it also covers the administrative and management functions – financial, strategic, talent management, back office technology, legal, etc.
Most small and midsize organizations cannot afford to master all of these areas of specialized knowledge with internal staff – at least not full-time. Not only is the initial cost of training high, but the ongoing investment required to keep all those different resources up to speed in their particular area of specialized knowledge is cost-prohibitive for most organizations. Therefore, it’s not surprising to see a proliferation in outsourced services, including payroll, benefits administration, staffing, IT, etc. Many companies have grown quite large by providing these specialized services to other businesses.
No less surprising is the increase in organizations buying talent by the slice – hiring consultants or advisors. Some areas of specialized expertise do not require high volumes of repetitive activities or transactions (such as payroll or benefits processing). Into these areas step veteran knowledge workers who prefer to work independently, spread their expertise over more than one organization, and networks with other individuals who possess similar or complementary expertise. By hiring such an advisor on an as-needed basis, a small to midsize organization can afford a level of expertise that they could not afford full-time.
This “talent by the slice” trend is likely to continue for three reasons:
Tags: baby boomers, talent management
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