3 PRINCIPLES TO ENSURE LEADERS DELIVER ON PROMISES

Without integrity, discipline and the ability to implement excellence, leaders will fail to  deliver on the promises they make.

by PROFESSOR DANNY SAMSON

 

Effective leaders lead by example and are true to their commitments. They deliver on their promises and, in doing so, set standards for others to follow. When leaders say one thing but do another, the organisation will suffer. On the flipside, when our staff see us as achieving and delivering on our agreed commitments, then they will follow suit.

I have been fortunate to study firsthand many of the world’s best companies, and observe what their leaders do to achieve their industry leadership. The common principles I’ve observed are integrity and discipline. They were strongly connected to a third key principle which was implementation excellence.

 

Principle 1: Integrity

Integrity boils down to openness, honesty and truth-telling. In great organisations, leaders deliver on their promises. They treat all stakeholders with respect and find ways to create mutual value for all parties. Organisations such as HP, Toyota, BHP and ABB are justifiably admired for always striving to take the high road on integrity. (Judging by what we have seen recently during the banking Royal Commission, the same cannot be said about many of our financial institutions in Australia.)

To test the comprehensiveness of your personal and organisational approach to “telling the whole truth”, consider the testing circumstance of how well you manage underperforming employees. Do the managers in your organisation fully manage poor performers and tell them the whole truth? Or do they take the easy route in the short term, and end up carrying passengers that weigh down the organisation and negatively impact on overall morale and engagement across teams and the wider business?

 

Principle 2: Discipline

The discipline principle involves establishing and living by a set of standards, in terms of operating procedures, and having stability in our processes. These help guide us in the delivery of our commitments. It is hard for anyone, even the most capable executive, to effectively deliver on commitments if the organisation is struggling in its day-to-day activities, lurching from one crisis to the next.

I haven’t seen a better company than Toyota when it comes to stability. Whenever the unexpected occurs, Toyota’s management focus as tremendous attention upon it, problem-solves it, and then returns to the steady state. With such a stable organisation in place, when executives commit to engaging in new or innovative initiatives, they usually have time to effectively deliver on them. That approach has become part of the Toyota culture, right from the top floor to the shop floor.

 

Principle 3: Implementation excellence

The implementation excellence principle is a high bar to achieve. Yet it is imperative if you want to consistently deliver on your promises. In fact, this is what separates high performers from the rest of the pack.

My research has found that when it comes to executing on major promises, there are two key requirements. First is the need to be well organised. This means planning and executing initiatives as formal projects, including a specific timeline, budget and outcome. (Executing that plan only works well when there is a solid plan in place of course!) Second comes the accountability for actually doing the work and reaping the benefits from the initiative. That means there are  consequences for poor performance, and recognition for high performance.

 

A remarkable combination

If you can combine these three principles in your organisation, the results can be remarkable. You will see leaders delivering on their promises and, in doing so, they will help to create a culture where others live up to these principles too.

But when leaders are not guided by these three principles, you can expect the organisation to be “soft” and slothful in its achievements. Ultimately the business will suffer after cutting corners and falling short on integrity (as demonstrated recently at various banks).

I encourage you to reflect upon this in two ways. First, by reading further about great leaders and their organisations where you can see these principles in action. Second, by questioning yourself and deciding what improvements you can make when it comes to integrity, discipline and implementing excellence.

Collectively, these three principles will enable you to deliver fully on your promises.

 

 

 

 

Professor Danny Samson, University of Melbourne Director, Master of enterprise & Master of Supply chain Management

 

 

 

MAKE YOUR MARK. GO CHARTERED 

Chartered Manager (CMgr) is the internationally-recognised professional designation accrediting management and leadership excellence.
The highest status that can be achieved as a manager and leader, it allows managers to professionalise their leadership skills and stand out in a competitive global market.
Focused on Continuing Professional Development (CPD), Chartered Manager is awarded on experience, expertise and a commitment to management and leadership.

For more details visit Chartered Manager

MENTAL HEALTH MEDIC

Dispelling stigma around mental health issues helps those suffering seek help, and Phillip Thompson AFIML, 2018 Queensland Young Australian of the Year, R U Ok? Ambassador and special projects manager for selectability, has dedicated himself to that cause.

  

Phillip Thompson has made it his personal mission to break the stigmas associated with mental illness. More than eight years ago, at the age of 20, the former serving soldier was wounded in Afghanistan, while serving with the First Battalion Royal Australian Regiment.

Thompson, of Townsville, suffered a traumatic brain injury, lost hearing in his right ear and was diagnosed with mental illness.

 

The experience and his road to “wellbeing” dramatically changed his life and outlook. Once Thompson started to work again, he threw himself into philanthropy, volunteering and advocacy work for people who have a mental illness, and those affected by suicide.

His dedication earnt him the accolade of 2018 Queensland Young Australian of the Year and led him to being chosen as an ambassador for well-being and suicide prevention organisation R U Ok? . He was also appointed as the organisation’s Special Projects Manager for Selectability.

 

“Friends of mine from the service have died by suicide and I think it’s important for me to advocate for them and for people who are still struggling,” he said.

He is honoured to be an R U Ok? ambassador and says the role is a perfect fit, as the organisation’s mission to reduce the stigma of mental illness and stop suicide aligns with his personal values.

“I am a hands-on ambassador,” he says. “I try to do all of it every day. I try and lead by example because in the veterans’ space, veterans under the age of 30 have a higher risk of dying by suicide than the general public.

“Townsville has the largest veteran arena in the southern hemisphere and the largest veteran cohort per capita in Australia. With R U OK?, what I do every single day is talk about suicide prevention, where to get help and how to break the stigma.”

 

Thompson’s role as Special Projects Manager for Selectability involves handling the organisation’s special projects. These can involve anything from organising government grants to project works; like a recent initiative that involved sourcing a building to create a purpose-built clubhouse to help teach workforce skills to people suffering from mental illness.

Thompson says it is important to him to lead a meaningful life. “Everyone asks, ‘How do we reduce stigma and how do we slow rates of suicide and combat mental illness?’ I think it’s about having purpose and meaningful engagement,” he said.

“Also, I think that’s what gets me out of bed. I get out of bed because if I don’t, I feel more friends of mine could succumb to their wars within.”   LM

 

Thrown in the deep end of management

What happens when you find yourself managing people… by accident?

Not all managers start out with aspirations to become a leader. For many, it’s a role they find themselves in by accident; one for which they’ve never been adequately prepared. It can happen if you stay at a company for a long time, and rise up through the ranks ‘by default’ as your superiors move on. It can happen if you start a solo enterprise that suddenly morphs into a bigger business. It can even happen when you’re assigned new duties during a company re-structure – and no one bothers to ask if you’re able or willing to perform them.

All the scenarios above can place a person in the uncomfortable position of being an ‘accidental manager’. While some rise to the challenge and quickly find their feet, others are quite conscious that there are things they ‘could’ or ‘should’ be doing to manage people better – yet they have no idea what those things are. In Australia, management has previously been a somewhat invisible skill; something people assume we can all do naturally (much like raising a baby that’s been suddenly thrust into your arms).

Unfortunately, this couldn’t be further from the truth. Good managers aren’t born, they’re made. It’s not enough to rely on the learning by ‘just doing it’ – leadership calls for skills that must be taught. Things like developing skills in others, performance management and conflict resolution. Skills to cope with situations that, outside management, you’re unlikely to encounter.

It’s easy to see why accidental managers are costing their employers money and lost productivity. Managers have the greatest single impact on staff retention and engagement. Gallup recently identified that managers account for at least 70% of the variance in employee engagement. It’s no wonder that 91% of Australian CEO’s believe leadership skills are the number one priority for learning and development.

The issues with Australia’s laid-back attitude to management is that legions of accidental managers are going about their business, with a creeping uncertainty that they’re actually ‘doing it right’. It was this key insight that inspired (IML) to re-brand last year with such a pointed focus on intentional leadership – and it’s this issue that we’re working hard to address.

So how do you avoid becoming an accidental manager?

For those who are on the brink of management (or hope to be soon), it’s worth taking a look at our Foundations of Intentional Leadership Program. This is a practical program where emerging leaders come together and learn the core fundamentals to get them off on the right foot. Over 12 weeks, including six face-to-face sessions, the program offers greater self-awareness through diagnostic tools, one-on-one coaching and mentoring, as well as access to IML’s impressive online Learning Management System – plus, the cost includes the annual IML Membership fee, making it easier to stay in the leadership loop once the program finishes.

“We know that people are being thrust into management roles, often because they’re great individual contributors – but this is not the same as managing a team,” says Sam Bell FIML General Manager, Corporate Services & Research chat IML. “These people really need support, especially if they’re suddenly having to manage people who were previously peers or friends. Through the program, we look at all sorts of challenges that can crop up, such as having difficult conversations, and provide practical ways to approach them. It’s a great way for emerging leaders to get the type of support they won’t automatically receive at work.”

And what if you already are an accidental manager?

“It’s never too late to get some formal training,” says Sam Bell.” Even if you’re a seasoned manager who’s confident in your skills, it can help to have some external support and recognition. We introduced the Chartered Manager  professional accreditation in Australia for this very reason – it’s an internationally recognised designation that gives experienced managers the chance to demonstrate competence and professionalise their skills.”

Wherever you are in the leadership journey, it’s important to know you’re not alone. Managing a team can be tough – but it doesn’t have to be an isolating experience. By connecting with networks like IML, you can get the learning through innovative leadership programs and meet people who get what you’re going through. And by getting your leadership foundations right from the start, you can enjoy a career that’s full of intent and purpose – and success that’s far from accidental.

To find out more about the Foundations of Intentional Leadership join us on July 17th for a free webinar. Register today!

There are limited places available in IML’s Foundations of Intentional Leadership Development Program. Register today: https://managersandleaders.alphasys.com.au/foundations-intentional-leadership/

4 reasons why I got my management accreditation

Why become a Chartered Manager?

Why did I bother? After all, I already have a Masters in Management (MMgt), and numerous other accreditations in coaching and human behaviour assessments. Well, while that’s great underpinning theory, we all know that it’s hands-on experience, proven results, and continual learning to stay current that matters most.

Just like other professions, standards of practice vary. For example, there are bookkeepers, qualified accountants, and there are Chartered Certified Accountants. As a leadership coach, it concerns me that in the coaching industry, there are numerous life coaches, wellness coaches, transformational coaches – a whole raft of labels anyone can use. From attending a weekend coaching course, to completing a full Diploma in Coaching, credibility varies greatly.

1. Get recognition as a manager

When IML ANZ refreshed their membership brand, they heralded a deliberate intent to raise the bar in professional standards of managers and leaders, they had my immediate attention. You see, leadership is at the core of everything I do, and everything I help others do. Our company – Vital Leaders’ mission is to develop more dynamic leaders, so it sits well with the Institute’s re-energised, agile direction.

On 16 January 2018, I officially achieved the internationally recognised, designated status of Chartered Manager – CMgr. What’s that mean, you ask? Good question. It’s quite a new recognition pathway for experienced managers and leaders in Australia and New Zealand. In fact, it is recognised as the highest status you can achieve as a leader.

IML ANZ offers this globally recognised designation here in Australia and New Zealand, though a strategic partnership with UK’s Chartered Management Institute – CMI.

2. Learn more about yourself as a manager

Similarly, there are accidental managers who fall into the industry and struggle without support, there are skilled semi-experienced managers who manage operations and outcomes, and there are dynamic leaders who inspire change, ignite growth, influence positive outcomes, and are intentional role models and mentors. There IS a difference, but it is often overlooked in recruitment processes and shoulder-tap promotions.

The Chartered Manager assessment offers two routes, depending on what qualifications and experience levels you already have. I took the qualified route, which required me to submit a comprehensive assessment outlining how I manage change and lead others, outcomes and learnings, from over the past 18 months. I also had to demonstrate how I stay current, including outlining my professional development plan for next 12 months.

An assessor was assigned to me, and I had the privilege of meeting with her for my final assessment interview in London, while I was there visiting family. My submission piece was assessed against strict professional ethics and the CMI Code of Conduct and Practice.

Honestly, the process was more challenging than I initially thought it would be – but that’s a good thing. Achieving Chartered Manager status is more than a document of proof or a form-filling exercise. It required considerable introspective reflection on why I do what I do, and particularly, what I learn from each experience. It recognised the vast range of skills I use, often subconsciously, but always intentionally.

3. Credibility, currency and commit to ongoing professional growth

What being recognised as a Chartered Manager means to me is these three core things:
Credibility – International recognition of my high-level expertise as a currently practicing company manager, leader of change, trainer and mentor of aspiring leaders; formally assessed to rigid Code of Conduct and ethical practice standards (formal qualifications + experience + intentions + results + learnings).

Currency – acknowledged value of what I currently do, how I resolve issues by challenging the status quo and driving change, how I meet client expectations by using the latest practices, and recognition of positive outcomes achieved the last 18 months.

Commitment to continual growth – acknowledgement of my insatiable thirst for continual professional development [CPD], and commitment to research and learning, for which I will be held accountable each year through a CPD reporting process.

4. Stand out from the competition as an intentional leader

Embedded into our leadership development programs, is a trust formula for leaders, which is fundamentally about building credibility.

Character + Competence + Consistency = TRUST.

The Chartered Manager process gave me the opportunity to provide evidence of my ethical, honest and intentional character, my competence levels and achievements, and my consistent approach to continually learn and grow. Being awarded the Chartered Manager designation and proudly upholding those standards, means I stand out from the mediocre, and stand proud as an intentional leader – as a trusted role-model and mentor.

Yes, it’s means more than just another paper certificate.

Yes, I’m proud of being globally recognised for my achievements.

But above all that, I’m honoured to share my journey and what I’ve learned so that others can aspire, reach and grow.

Intentional leaders mentor and develop more leaders … and my intention is to keep doing that.
Leadership credibility matters.

Want to find out more about becoming a Chartered Manager? Click here.

By Jilinda Lee CMgr FIML, Director and Founder of Vital Leaders.

5 Reasons They Keep Leaving

1. The lowdown on staff remuneration & retention in 2018

It’s no secret that pay increases have been few and far between in recent years, with wage growth in Australia currently sitting at a record low of 2.9%. Considering the state of our economy, this isn’t wholly surprising – in the past year alone, we’ve felt the impacts of everything from extreme weather events to political instability, both globally and close to home. With the International Monetary Fund predicting that Australian economic growth will only reach around 2.2% in the coming year, a return to the golden days of pre-GFC pay-packets does not seem imminent.

While the economy is certainly a contributing factor, it’s also unlikely that this is the only reason we’re seeing such sluggish wage growth. With the rise of the ‘gig’ economy, the way Australians are working is changing too, with online platforms like Uber, Deliveroo and Airtasker opening up more competition for hourly-wage jobs. Our perception of what it means to be an “employee” is changing – and so are our expectations.

In some ways, Australians in 2018 are demanding more, especially in terms of flexibility and culture. In other ways, we’re asking for less – especially in situations where our rights aren’t clear, or where we’re too insecure about our job to ask for a pay rise. As more industries embrace freelance and contract workers, these trends are likely to start affecting professionals too, especially if work can be done remotely.

2. What does all this mean for Australian businesses – and workers?

Anyone who has waited, hoped, asked or even fought for a pay rise will know how important it is to feel properly valued and compensated – and how off-putting (even devastating) it can feel to have your request refused. However, while there’s a clear link between salary and staff retention, you might be surprised to learn that pay isn’t the only thing that buys the loyalty of an Australian worker.

The 2017 Staff Retention Report from the Institute of Managers and Leaders (IML) drew on responses from 246 organisations across Australia, who shared their employment data as part of IML’s National Salary Survey. When asked about their employees’ top reasons for leaving the company, respondents stated that two of the top reasons were the desire to seek new challenges, and the fact their current employer provided limited opportunities for staff development. Salary was cited as the third driver – showing that, while money matters, it takes more than salary to keep a worker happy.

3. Employees don’t just want to be paid, they want to be valued.

High turnover isn’t just disruptive and potentially damaging for workplace culture, it’s expensive too. At IML, our research tells us that it takes an average of $23,753 to attract, hire and train a new staff member – a cost that most businesses would prefer to avoid. With this in mind, it’s key for Australian businesses to stay on the front foot when it comes to staff retention strategies.

According to 2017 research from the IML Staff Retention Report (a supplementary report from the data gathered from the National Salary Survey), some sectors may need to work harder than others. While overall staff retention in Australia decreased from 2016 to 2017, Professional Services, IT and Finance all saw considerably higher turnover than average. In contrast, Agriculture, Manufacturing and Mining were the most stable, with below average turnover.

Happily, it does look like Australian businesses are rising to the challenge of giving their people more opportunities to learn, grow and succeed. Henley Business School’s Corporate Learning Survey found that 35% of respondents spent more on training in 2017 than 2016, a 7% increase since the last survey. Participants also ranked their top challenges as managing the speed of change, and achieving cultural change. This is positive to see, as it suggests there’s an increasing appreciation for the way in which an employee’s experience can add value to their role – over and above the actual salary they take home.

4. How do you know what someone is worth?

One of the toughest questions for employers is how much to invest in the people who work for them. Calculating an employee’s worth is rarely straightforward, and there’s much more to it than assessing someone’s job description and performance reviews. A multitude of other factors also need to be considered, from an individual’s past tenure and future potential, to the cultural influence they have within the organisation.

When weighing all this up, it helps enormously to know what your peers are doing. After all, if you don’t give someone the salary, training or support they expect, there’s a good chance someone else will. Equally, if you overpay staff, it could have a detrimental effect on your bottom line, and create resentment within your team.

This is where resources such as IML’s National Salary Survey are invaluable. Due to be released on 30 April 2018, our latest survey not only provides a benchmark from which to make sound remuneration decisions, it also provides insights into how other organisations are approaching things like training and development.

As mentioned earlier, it’s important to remember that salary is only part of the equation. For some employees, having fresh challenges or a clear pathway within the business is just as important as salary (if not more). Fortunately, IML has the tools to help you to discover what your people want (such as profiling tools and 360-degree reviews), and many ways to recognise and support their growth (our Chartered Manager accreditation is just one example).

5. With all this in mind, it’s worth asking yourself how you’re deciding the value of your employees.

Is it something you determine based on budget alone? Is it perhaps more emotional than rational? Are you still in touch with what your peers are doing for their staff, and is your approach still suitable? If you’re uncertain about any of these questions – or whether you’re still ‘on the money’ where salaries are concerned – it’s worth finding out.

For the latest data on everything from bonuses to benefits, pre-order the IML National Salary Survey, or contact the IML team to find out more.

4 Hidden Indicators that Trust Issues are Negatively Impacting your Organisation

By Marie-Claire Ross

For 19 years, Greats Places to Work and Fortune magazine have been formulating The 100 Best Companies to Work For list.  Surprisingly, the distinguishing theme underpinning all of the best companies is not their fancy freebies, parties or lavish annual leave policies.  It’s how much trust there is between co-workers and managers.

Companies that scored highly for trustworthiness also finished first for metrics on higher profitability, revenue growth and stock performance.   But just like people, these organisations are not perfect.  The research uncovered major discrepancies between the experiences of those on the frontline, as well as differences between gender, ethnicity and even full-time versus part-time workers.

What’s becoming increasingly obvious is that organisations that have company leaders right down to front-line workers who all embrace the value of a candid and open exchange of ideas and information, create highly functional and profitable enterprises.

After all, it’s trust that enables different people within an organisation to consistently rely on each other. It’s trust that enables your customers and other stakeholders to believe that you will deliver on your promises and behave responsibly. It’s trust that enables a company or brand to bounce back after a crisis.  And it’s trust that enables an organisation to change and grow.

Yet, very few organisations strategically improve trust in order to improve performance.  One of the problems is that trust is an emotional issue and it’s hard to see, let alone fix internally.   It is often outside the sphere of leadership capabilities.  Even when they do realise trust is a problem, they each have a different frame of reference making it tricky for everyone to know the best steps forward.  Often leaders, waste time and headspace focusing on the wrong trust elements or deny it’s a problem.

Here are four common leadership frustrations that are all signs of trust issues that negatively impact workplace culture.

 

1. Working around People, not with People

A common CEO gripe is that newly formed teams (and even existing) operate more like a collective of individuals rather than a team.  Team members prefer working with those they know and avoid newcomers or even those with different job titles.   Email is preferred to discussions and the most knowledgeable person in the team is rarely consulted.  The result is that people work in different directions and make poor-quality decisions.

On the surface, these teams may appear to be operating at a decent level.  It’s only when leaders start comparing the outputs of a few teams together that the stark difference between performance become apparent.  High trust teams are inclusive, get more done and reach goals faster.

 

2. Fear of Relying on Others

Following on from teams is the even bigger issue of departments and units not collaborating together.  Research by Harvard Business Review reported that only 9% of managers feel that they can rely on cross-functional colleagues all of the time, and only 50% say they can rely on them most of the time.  Managers also say they are three times more likely to miss performance commitments because of insufficient support from other units than because of their own teams’ failure to deliver.

When managers cannot rely on colleagues in other functions and units, they undermine execution by duplicating effort, letting customer promises slip, delaying their deliverables or passing up attractive opportunities.

 

3. Avoiding Delegation

One of the most important capabilities of a successful leader is being comfortable with delegating work.  This makes them more effective because they get more work done and let their direct reports know that they are confident in their abilities to deliver.  It improves accountability and goal kicking.

Leaders who avoid delegating tend to rely on themselves falsely believing only they are capable of doing the work.  Over time, they feel alone, even betrayed by the organisation, because they feel overworked and overwhelmed.  At the same time, they get categorised as being a micro-manager, limiting career opportunities.

Managers who delegate well have the time to focus on the bigger picture.  They avoid jumping from one fire to another.  Not only does it increase their job satisfaction, but those reporting to them feel empowered, accountable and more confident in their own abilities and even the leader.

 

4. Not Speaking Up

A study by VitalSmarts found that when people were afraid to speak up about issues, employees were engaging in resource-sapping behaviours such as: complaining to others (78%), doing extra or unnecessary work (66%), ruminating about the problem (53%), or getting angry (50%).

These are costly behaviours.  The same research found that the average person wasted seven days undertaking these dysfunctional problems instead of talking about it.  Silence damages deadlines, budgets, relationships, turnover, employee engagement and meeting goals.

After all, when you don’t get the unpleasant stuff out of the way, you waste a lot of time.  It’s hard to get moving on anything if people won’t talk through issues or how to resolve them.

Humans are designed to avoid conflict.  Both leaders and employees alike fear speaking up about their concerns or even alternative opportunities in case it makes them look stupid or unpopular.

It is an important leadership challenge to create a strong, shared culture where people are unified, to avoid a political and potentially adverse environment.

 

Getting Ready for a Collaborative Future

With technological advances increasing and change occurring at a rapid rate, the reality is that employees within an organisation need to rely on each other more.  There is a revolution occurring in how we need to interact together at work.

Yet, few companies actually consider how to address this specific issue, especially from a trust perspective.  Some even accept their current operating model as a normal part of doing business and how people collaborate.

But the companies that will successfully meet the challenges of tomorrow will be those that require employees change how they interact with one another.  And it all starts with leaders who can build trust.

About the author:
Marie-Claire Ross is the Chief Corporate Catalyst at Trustologie.  She is a workplace sociologist, author and consultant focused on helping leaders put the right processes in place to empower employees to speak up about issues, challenge each other and share information.  You can see her at Leading Well Conference on April 27 2018 discussing 5 Hidden Trust Decelerators that Sabotage Leadership Result.

 

Marie-Claire Ross will be speaking at the The IML Conference 2018. The series explores the topic of Leading Well, and this Melbourne event will focus on how to develop and build high performing teams that drive financial success and ROI. This conference will be an interactive day including keynote presentations, panel sessions, case studies and Q&A’s. Join us for the third-year running to uncover the latest management and leadership thinking.

 

Book now

 

 

A Battle Worth Fighting For

By Stuart Taylor,  Chief Executive Officer of Springfox (formerly the resilience institute Australia).

Creating a resilient corporate culture takes time and effort, but you won’t regret it.

Stress. We all experience. We all talk about it. Even seeing the word in print stirs at least a little discomfort in most.
Removing stress from the workplace sounds like a great idea in theory. In reality, though, a certain amount of stress can be beneficial and, in some cases, necessary to drive individuals and corporations to higher levels of performance. However, there is a tipping point at which pressure to perform has counterproductive effects.

The focus of modern cultural change programs shouldn’t be on removing stress, but rather on creating an environment where people are able to process, rationalise and view pressure as a opportunity. Employers don’t need to create stress-free organisations, they need to create resilient organisations.

Organisations exist for people and through people. It is true that modern organisations are increasingly characterised
by technology, systems, processes and rules, but at the core they remain much like any other group of people or tribe. And just like any other tribe, members look to the chief to rally them in times of trouble.

A resilient corporate culture is one that is able to balance the drive for high performance with a focus on maintaining the safety, well-being and effectiveness of its people. Resilient organisations understand that high performance is very different to sustainable high performance. And it all starts at the top.

“In a volatile, uncertain and complex world, resilience is a strategic asset.” – Stuart Taylor

Disruption, resulting from technological advances and geo-political shifts, personifies the modern corporate battle ground. This places people under increasing pressure and strain. The persistent change in the world and the pressures on us to transform and adapt require agility.

To thrive in this environment, organisations must commit to a systemic approach to fostering a resilient culture where people feel respected, trusted and supported. Leaders must be role models. When they fail to engage, the tribe loses trust in its chief.

Our organisation’s study of 26,099 professionals over a six-year period revealed confronting insights about our modern workforce. More than half of those surveyed (55%) worry excessively, 50% are hyper vigilant, 45% experience distress symptoms, and 30% experience excessive work intensity, and/or have impulse control problems.

The research clearly demonstrated that the workforce is anxious and overloaded, contributing to a prevalence of absenteeism, presenteeism, conflict and attention loss in the workplace. The effect of absenteeism alone costs the Australian economy more than $44 billion a year.

Here are some simple steps leaders can can take:

  1. LEAD WITH COMPASSION

    Resilient organisations are possible when you lead with deep care and the ‘greater good’ in mind. Sometimes this requires tough love, however, it will build trust and respect.

  2. SHOW VULNERABILITY

    A powerful way to demonstrate your trust, compassion and respect for your people is to ask the same of them. Leaders who aren’t ashamed to show their shortcomings demonstrate that what is expected is commitment and effort, not perfection. This breeds a culture of accountability, where people are willing to admit they need help or have made a mistake.

  3. TALK TO YOUR PEOPLE

    People perform best when they understand what’s expected of them. Make your strategic priorities clear and resist the urge to use corporate jargon.

  4. FIND OUT WHAT PEOPLE ARE GOOD AT

    We all do best when we play to our strengths. A concerted effort should be made to help people understand what their natural strengths are. This can contribute to an organisation’s strategic priorities.

  5. CONSIDER DIVERSITY

    Does your organisation accurately reflect the world outside? It is critical  that people feel comfortable to be themselves at work, regardless of age, gender, sexuality or cultural beliefs. A considered diversity strategy is critical for any modern organisation.

5 Ways To Improve Your Cash Flow

By Toby Smith

 

As a successful manager, you’re well aware that the survival of any business – regardless of size and profitability levels – ultimately depends on cash flow. Most businesses that end up in liquidation reach that point because they run out of cash.

This article outlines a number of measures you can implement to achieve sustainable cash flow improvements. Even if cash flow isn’t a major concern for your business, following these steps can help you to free up capital to invest in infrastructure improvements or growth opportunities.

 

1 – Regular financial reviews

Having detailed and up-to-date knowledge of your financial performance is critical. If financial management isn’t your strength, engage a strong finance team to advise you, and ensure they maintain a steady focus on cash flow and profitability rather than growth rate.

Your schedule should include a monthly analysis of your financial statements, looking not just at your current financial status, especially your free cash flow, but also at past performance (your trends and trajectory, particularly your profitability ratios and return on capital employed (ROCE)) and at forecasts for the immediate and longer-term future.

Regularly drill down and examine the financial performance of each of your product or service lines and sales channels, as well as your stock levels, debtors and assets.

This information will help you to make informed strategic decisions about your operations and enable you to identify potential issues in time to take corrective action to protect your cash flow. For example:

  • Organising short-term finance to cover working capital shortages
  • Matching the timing of expenditure to income if you have fluctuating income (by delaying discretionary purchases or negotiating with creditors)
  • Adjusting your stock policy if you’re tying up cash in excess inventory (be wary, for example, of buying extra stock to take advantage of vendor discounts or rebates, as savings can quickly be lost to storage costs)
  • Tightening up your credit terms or collection policies if too much cash is tied up in bad debts, and imposing purchase restrictions until debts are cleared, or even ending relationships with clients that have a poor payment record.

 

2 – Regular strategic reviews

Unfortunately, for many businesses, a strategic plan is something that’s created once then either forgotten or followed rigidly without review. As a result, precious cash gets tied up in obsolete stock, irrelevant marketing campaigns, bad debts and unnecessary assets.

To stay competitive and keep your cash flowing freely you need to regularly re-examine every aspect of your business to make sure that your:

  • Product lines or services still meet your customers’ needs
  • Sales channels are aligned with your customers’ preferences
  • Marketing initiatives are successfully attracting new customers
  • Technology and equipment are appropriate for your needs (it can be tricky to find the balance between staying efficiently up-to-date and not wasting cash on unnecessary upgrades).

Being willing to change direction and redefine your strategy – including making tough decisions on the future of product lines, sales channels, marketing strategies and assets that are draining your cash flow – is critical to long-term success.

 

3 – Cautious growth

One of the main reasons companies run out of cash is that they grow too fast.

The risk is that in order to meet the demands of new customers or clients, you’ll have to invest heavily in infrastructure, materials or labour. That up-front investment can wipe out your working capital reserves and leave you dangerously exposed until you receive the funds from the extra sales.

If you don’t have the cash to meet your financial obligations in the meantime, your business may not survive to reap the benefits of that sales growth.

Focus instead on steady, cautious growth that won’t exhaust your cash reserves or stretch your resources to the point where your service levels (and reputation) will suffer. And be very wary of funding growth with borrowings, especially when interest rates are rising.

 

4 – Prudent borrowing

Loan repayments can be a major drain on your cash reserves, and unless you’ve locked in fixed interest rates you’re always at risk from rate increases that can play havoc with your forecasts and quickly deplete your cash reserves.

The most important measure you can take to minimise your cost of borrowing is to make sure the term of your loans match your business needs:

  • Never use short-term facilities like an overdraft or credit card to finance the purchase of long-term assets. Not only will you pay higher interest rates and charges, you also run the serious risk of having the facility withdrawn before the asset is paid off – leaving you with an instant cash flow crisis.
  • Avoid using long-term funding to boost your working capital. Many long-term loans have penalties for early repayment, which can you leave you locked into paying for finance you no longer need. Instead, opt for at-call finance to smooth out fluctuations in your cash flow, so that you’ll only pay interest on funds when you need to draw on the facility.

Shop around for business finance, especially if you need a fast cash injection – the ‘fintech’ alternative loan market is booming in Australia, offering a competitive source of funding for businesses of all sizes. Be aware, though, that alternative lenders aren’t regulated in the same way that Australian banks are, and some may seek to impose restrictive loan conditions in order to reduce their risk.

 

5 – Putting your cash to work

While most cash flow improvement measures focus on finding ways to increase cash reserves, it’s actually possible to have too much cash, earning negligible interest and leaving you with poor ROCE.

If you do happen to have large cash reserves – more than you need to meet your working capital needs, fund your loan obligations and cover an extended downturn in sales – you may want to consider reinvesting those funds in your business.

One way you can use excess funds to improve cash flow is to repay loans (if you can do so without incurring penalties) since the interest you earn on your savings will never match the amount you’re paying on your borrowings.

Leadership In Crisis

Written by Sebastian Salicru 

Organisations are known to invest heavily in leadership development. But in a rapidly changing world, are the traditional approaches paying off? 

THE PROBLEM: 

In a world of complexity, turbulence, high-velocity and continuous change, the context for leadership, as we know it, has been turned upside down. Recently, we have witnessed what I call the ‘three Ds’ of leadership – distrust, doubt and dissent. These are the outcomes when leaders fail to respond effectively to the changing context in which they must lead and the expectations of their stakeholders. Distrust and lack of engagement flag the need for leaders to rethink how to exercise leadership and engage their followers. Traditional leadership approaches no longer hold water. The briefest glance at the television news or daily newspaper paints a vivid picture of the global and local leadership crisis, with escalating trends and all-pervasive images to dismay even the most casual viewer. I would contend that data, facts and figures say far more than even a thousand words. Credible research at the forefront of contemporary thinking tells us that current investments in leadership may not be paying off:

  • Only 13 per cent of employees worldwide are engaged at work (Gallup)
  • 81 per cent of CEOs rate leadership development programs as less than highly effective (PwC 2015, Annual Global CEO Survey)
  • Of 7500 business and HR leaders in over 100 countries, 55 per cent judge the return on investment (ROI) of their current leadership development as fair to very poor, and less than 20 per cent are confident they have the leaders they need to deliver on strategic priorities (Korn Ferry, 2015 Global and Regional Real World Leadership Report).
  • Of 2200 global HR leaders, 86 per cent believe their organisation’s future depends on the effectiveness of their leadership pipelines, but only 13 per cent are confident in their succession plans, with 54 per cent reporting damage to their businesses due to talent shortages (Deloitte’s 2015 Global Human Capital Trends: Leading in the new world of work)
  • Only 6 per cent of executives feel ‘very ready’ to meet their leadership needs in 2016 (Deloitte’s 2016 Global Human Capital Trends. The new organization)
  • 86 per cent of the 1500 world’s foremost global experts believe that the world is currently experiencing a leadership crisis (World Economic Forum. Outlook on the Global Agenda 2015)
  • Only 7 per cent of organisations feel they have a ‘Best in Class’ leadership development program (Harvard Business School Publishing. 2016 State of leadership development survey).

Meanwhile, in Australia, research conducted in 2016 by the Centre for Workplace Leadership, University of Melbourne revealed 75 per cent of employees needed better managers and leaders. Gallup estimates the cost of the resulting lack of engagement is $54.8 billion a year. This precarious state of affairs exists despite the fact that organisations invest heavily in preparing their leaders. The 2016 Harvard Business Review article ‘Why leadership training fails – and what to do about it’, describes this growing multibillion dollar leadership development industry as failing to deliver results and asserts that corporations have become victims of “the great training robbery”. You don’t have to be a rocket scientist to know that urgent change is required.

 

“This precarious state of affairs exists despite the fact that organisations invest heavily in preparing their leaders.”

 

My research identifies that the following practices will create adaptive leaders and high-performing organisations and deliver leadership results:

  1. Painting a clear picture
    Keep it clear and simple – this encourages people to adapt to change and act. In times of uncertainty, people want to know: what’s the story? Effective leaders are adept at painting a clear picture through storytelling and can help others to interpret and respond positively to change.
  2. Build leadership capability
    Traditional leadership approaches mistake management, authority and power with leadership, which involves exercising influence, whether you are in a position of power and authority or not. Traditional approaches to leadership development are individual-centred only. They confuse ‘leader’ development with ‘leadership’ development. Leadership development historically has focused on enhancing the knowledge, skills and abilities of those holding senior managerial positions only. This focus needs to expand to improve the leadership capacity of the whole organisation, and to develop and improve the relationships and collaboration that knit all units, departments, and networks together.
  3. Move beyond competencies
    Competency models emerged in the 1970s as a way of codifying the required behaviour for particular leadership positions. They drew on past successes by identifying relevant and effective behaviour as opposed to examining mindsets needed for the future. A more holistic and integrated approach to leadership development is required that addresses the many (less visible) mental, emotional, and psychological processes that often determine behaviour. The solution is moving towards using ‘adaptive’ or ‘meta-competencies’ – the sets of knowledge, skills and aptitudes that underpin or allow for the development of other competencies, especially those that people will need in the unpredictable future. Meta-competencies enable learning, adapting, anticipating and creating change. Both self-leadership (personal mastery) and leadership development require going beyond competencies, though they are grounded in competence and skills. Developing character is the key to effective leadership and, given that leadership is a relationship between people, leadership effectiveness is related to everyone’s efforts to create positive relationships in the organisation. Kevin Cashman, CEO at Korn Ferry, explains that “competencies get us to the doorway of leadership, but character gets us through the doorway of leadership. Managers tend to control resources to get results, but leaders exert character to build a sustainable future.”
  4. Focus on creative thinking and innovation
    Modern organisations need to innovate continuously to ensure their long-term survival and success. Leadership is the precursor of all innovation. Strategically, leaders establish work environments that are conducive to creative thinking and innovation, which in turn leads to a competitive advantage.
  5. Conduct impact evaluations
    Evaluation is an important component of the leadership development process itself with three main benefits: extending the reflective dimension of the program by inviting participants to consider the value of the experience and how they apply it; gathering valuable suggestions for improvements to the programs; and fostering employee engagement and loyalty.

THE SOLUTION: 

Collective leadership involves all employees and means that everyone is responsible for the team or organisation’s success and not just for their individual role. This means leadership is distributed, rather than being centred on a few individuals in formal positions of authority. The broad distribution of responsibilities is naturally more inclusive, as it involves all participants, which makes collective leadership more effective than individual leadership.

This approach to leadership offers each individual voice in the organisation. This, in turn, empowers people, who then feel more valued, trusted and heard. In this way, everyone’s interaction and effort at every level drives performance and shapes the culture of the organisation.

Collective leadership is relational rather than hierarchical. It enables everyone to be active in leadership roles as it flattens workplace structures. Giving people more responsibility also means allowing them to be more accountable, take risks, make mistakes and learn from them. This can allow individuals to be more accountable and empowered, making them more committed, engaged, creative and innovative. In this context, leaders become mentors, supporting each other to achieve an organisation’s collective goals and outcomes.

Years of traditional leadership have resulted in systems that value hierarchy, status, authority and control. The move to collective leadership requires change not only at a leadership and cultural level, but also at an individual level. The challenge in shifting to collective leadership is that people are not used to having a voice. Instead, they are used to a dependency created by the pervasive ‘leader–follower’ paradigm. Dependence on a leader does have some clear implications, even though influential leadership can wean followers off their dependence. First, it implies that the followers or subordinates have limited ability to make decisions and get work done without guidance or permission. This results in hesitation, employees who feel vulnerable and threatened by change, and substandard decision making, which produces less than desirable results and decreased productivity. Psychologically, this means the subordinates’ self-esteem and motivation depends on receiving recognition and approval from their leader.

As William James (1842–1910), a philosopher considered one of the fathers of psychology, said: “The deepest principle of human nature is the craving to be appreciated”. Leadership dependency creates this craving and keeps individuals in a cycle of looking for recognition from places beyond their control. This often leads to dissatisfaction, powerlessness and anxiety.

Second, it means that for leadership to succeed, the followers must idolise their leaders, often as authority figures, attribute to them unrealistic qualities and create unrealistic expectations of them. In turn, leaders on pedestals can be pressured by the need to always be correct and can become overly defensive to criticism.

“Collective leadership means each individual has a voice in the organisation.”

Finally, dependence stifles followers’ creativity and kills any chance of them offering innovations. Traditional leadership patterns rely on control, obedience and conformity. Followers who dare not depart from their leader’s ideas are not engaged in their own creative processes.

Empowerment, on the other hand, is about providing others with autonomy and independence. This occurs when people feel valued for their experience, potential and contribution. Empowered individuals are motivated, believe in their ability to perform successfully and are also more creative. Collective leadership allows individuals to develop their own abilities and independent thinking skills, which builds collective social identification and self-efficacy – a shared belief in the ability to accomplish tasks and achieve common goals. This in turn fosters team creative thinking and innovation, which creates an environment rich with job satisfaction and improved results.

Clearly, collective leadership is a relational, fluid and evolving approach where multiple (if not all) employees or individuals assume leadership roles in a group or organisation in response to specific situations, settings or contexts. It means everyone takes responsibility for the success of the organisation as a whole. With everyone taking responsibility for the organisation’s success, power needs to be distributed to where the right capabilities, expertise and passion exist.

Collective leadership, therefore, requires networking and collaboration across organisational boundaries. It draws on a firm’s social capital and builds on the knowledge, skills and abilities of all employees. It requires individuals to engage in high levels of communication and to work openly and interdependently to share ideas and have a joint vision and common goals.

When done successfully, collective leadership benefits everyone, allows for more innovation, allows organisations to adapt to change quickly, and delivers outstanding performance and results.