The Candle Problem undertaken by Carl Dunker in 1945, where a candle and tacks were placed in a box with some matches on a table and those taking part were asked “how do you attach the candle to the wall, light it and prevent the drips from falling on the table”. It was reused by Sam Glaxberg who proved that the pressure induced by financial incentives made teams less efficient by 31/2 minutes. So money can work as an incentive for mechanical and automated tasks but not for tasks requiring creative and cognitive skill here the pressure builds with the size of the reward and the degree of complexity related proportionally to the paucity of the performance. So money is not the answer. Extrinsic rewards were very much part of the management of workers last century. Today’s team members prefer far more intrinsic rewards once they have met their extrinsic needs.

So what other inducements has a leader got to enhance his team’s performance?

Today’s employees unlike their predecessors like a degree of autonomy. They like to know where they fit within an organisation and where the organisation is going. They like to understand and fit the culture and the values of the organisation as they consider choice to be an essential part of modern life. But they like to feel they have some say and some control of what they do.

They like to feel that they are developing personally in their chosen occupation or role. There is a desire to be seen and recognised as an expert. So they need to see that they are progressing and expanding their knowledge and experience. They also need to recognise that there are opportunities to do this in the future.

The idea that money is king is balanced by a sense of purpose and this is the dichotomy the world is wrestling with now. How do you as an individual or unit survive comfortably and yet maintain a purpose and a contribution to the wider good in a very capitalist and media driven selling environment.

People need cash enough to survive in their chosen environment at their chosen status but they need much more from their employment if they are to be motivated within their employment they need purpose and control in their lives and that is part of modern freedom delivered when humans no longer need to be in a herd continuously to survive.

Sampson Hall are running a series of events in the South West in Exeter and the North East in Newcastle which cover topics such as this. Further information is available at http://www.sampsonhall.co.uk/services/course-dates-and-descriptions.html

Where is the vision? Where is the coordination? Where is the leadership?

The director of the United Nations Mil­lennium Project Jeffrey Sachs offered a Big Plan to end world poverty, with solutions ranging from nitrogen-fixing leguminous trees to re­plenish soil fertility, to antiretroviral therapy for AIDS, to specially pro­grammed cell phones to provide real-time data to health planners, to rainwater harvesting, to battery-charging stations, to cheap medicines for children with malaria — for a total of 449 interventions. Professor Sachs has played an important role in calling upon the West to do more for the Rest, but the implementation strategy is less constructive.

So the vision is there and the planning that naturally follows it is there. Where is the leadership? Where is the coordination?

According to Pro­fessor Sachs and the Millennium Project, the UN  Secretary-General should run the plan, coordinating the actions of officials in six UN agencies, the UN country teams, the World Bank, the International Monetary Fund, and a couple of dozen rich-country aid agencies. This Plan is the latest in a long string of Western plans to end poverty.

Unfortu­nately, the West has a bad track record when it comes to meeting its goals. A UN summit in 1990 set as a goal for the year 2000 universal primary-school enrolment. (That is now planned for 2015.) A previous summit, in 1977, set 1990 as the deadline for realizing the goal of universal access to water and sanitation. (Under the Millennium Development Goals, that target is now 2015.) Nobody was ever held accountable for these missed goals nations hide behind national agendas and leaders shirk their duties.

So perhaps the leadership is not there but what about the coordination?

At the World Economic Forum in Davos in 2005, Sharon Stone raised a million dollars on the spot for more bed nets in Tanzania. Insecticide-treated bed nets can protect people from being bit­ten by malarial mosquitoes while they sleep, which significantly lowers malaria infections and deaths. But if such nets are such an effective cure, why hadn’t Planners already got them to the poor? Unfortunately, neither celebrities nor aid administrators have many ideas for how to get bed nets to the poor. Such nets are often diverted to the black market, become out of stock in health clinics, or wind up being used as fishing nets or wedding veils.

The non profit organization Population Services International (PSI), gets rewarded for doing things that work. PSI stumbled across a way to get insecticide-treated bed nets to the poor in Malawi, with initial funding and logistical support from official aid agencies. PSI sells bed nets for fifty cents to mothers through antenatal clinics in the countryside, which means it gets the nets to those who both value them and need them. (Pregnant women and chil­dren under five are the principal risk group for malaria.) The nurse who dis­tributes the nets gets nine cents per net to keep for herself, so the nets are always in stock. PSI also sells nets to richer urban Malawians through private-sector channels for five dollars a net. The profits from this are used to pay for the subsidized nets sold at the clinics, so the program pays for itself. PSI’s bed net program increased the nationwide average of children under five sleeping under nets from 8 percent in 2000 to 55 percent in 2004, with a similar in­crease for pregnant women. A follow-up survey found nearly universal use of the nets by those who paid for them. By contrast, a study of a program to hand out free nets in Zambia to people, whether they wanted them or not (the favoured approach of Planners), found that 70 percent of the recipients didn’t use the nets. The ‘Malawi model’ is now spreading to other African countries.

The local PSI office in Malawi (which is staffed mostly by Malawians who have been with the program for years) was looking for a way to make progress on malaria when it discovered the solution. They decided that bed nets would do the job, and then hit upon the antenatal clinic and the two-channel sales idea. This scheme is not a magical panacea to make aid work under all circumstances; it is just one creative response to a particular problem.

So the co-ordination can be there through innovation and entrepreneurialism!

What is the real problem? Well it’s down to leadership and in the business world leaders make or break an organisation yet in the philanthropic world of humanitarian aid leaders seem unable to operate effectively and deliver to laudable well constructed goals. They lack the tool sets to deliver, they lack the ability to make a difference and yet the Western world sits back happily resting on its laurels having donated over 11/2 Trillion £ to help those poor people who suffer so much in the harsh environs of the third world.

Let’s get cleverer at delivering aid by employing top leaders, empowering them to deliver and rewarding them when they do so innovatively and with an entrepreneurial flair. Let’s give them the tools to deliver aid far more effectively and close that leadership gap.

Having worked with several charities I have found that the leadership, team cohesion and motivation and the leadership challenges are very different from those we have experienced when working within the corporate sector. Charities are businesses in their own rights but they work under a different and more challenging set of rules and circumstances.

Where a leader in the corporate sector just has the conundrum of balancing stakeholder profit with customer value and societal/brand expectation. A leader in a charity has to balance trustee requirements, fundraising requirements, employees and volunteers, societal expectations and the end user service/value.

Let’s start by looking at the trustee dimension within a charity, as it is the most complex of the issues. Trustees are generally very well meaning and highly motivated people who work genuinely hard for a heartfelt cause. However, they may not all come with the same motivation and agenda. Hence, they may value different aspects of a charities work in different ways. They need to be marshalled to be truly cohesive in their approach and yet they need to be independent in their judgement, in order, to ensure the charity adheres to the requirements of the law and the Charity Commission as it moves forward.

Fund raising has many tenets from investment, the basic retail of products, to the winning of funding and grants from public and charitable bodies, to the support of individuals as they raise money. These aspects combined need to provide the working funds for the charity to function and develop. The charitable  financial world is complex and fraught with risk during these frugal times, accountability and transparency has never been more valued and demanded by the customer and the regulator.

The employment environment of a charity is also complicated when it comes to motivating, leading and managing those involved. A charity will normally have paid employees who work in normal employee circumstances alongside those who volunteer their services. The paid employees, whilst viewing their employment as a job, may be intrinsically motivated to choose to work within the sector. However, it is the volunteers that bring other challenges in terms of motivation and expectation. How do you plan an event when you don’t know how many people you will have there organising it?

When it comes to providing value for your customers, identifying who they are and how their expectations can be met is critical. Each customer will have a very different perspective of the charity and it’s work. Derived from the reasons for their association with that charitable organisation. Contributors to the charity will expect their money to be spent wisely. Those who benefit from the work of the charity may have real issues and problems in their lives that have driven them to seek help. Some will be so desperate that any assistance will do and others will be far more choosy. Circumstances will be incredibly varied depending upon the focus of that particular charity.

The intrinsic rewards of charitable work far outweigh the financial reward and yet the challenges of leading such organisations in the highly competitive charitable sector can lead to a stressful and lonely existence. Best practice needs to be shared more effectively and proven solutions to common issues need to be more available to all those involved, in the leadership of these wonderful organisations, who afford our society so much.

Sampson Hall are now working with Charity Leaders as part of the Charity Forums UK. To help them work together, share best practice and support each other.

Not very well is the answer.  With public hostility to the banks showing no sign of abating, when are the banks going to start living by the morals and ethics that most of us in our business and private lives abide by?

Not any time soon, by the sound of it.  Even more interesting, unless RBS faces any further punitive charges, it will return to the same high operating profit of £3.5 billion that it made this year.  Unless more procedural failings emerge.  Lets not hold our breath on that one.   Nor any suggestion of a change in the culture of the banking hall.

In our modern world when does an organisation really need to stand up for the values it expounds? Acknowledging that truth comes before trust; how can the leaders who were the exponents of much of the wrongdoing now inflict a different less profit oriented culture on those who follow them? Particularly if they are still using their obscene, outdated and questionable reward system that does not fit the value sets of current social corporate practice

Why should the tax payer continue to support a self perpetuating antiquated money oriented system that is not fit for purpose? It is as close in terms of risk and reward to drug dealing although the associated rich rewards come without the personal risk. Is this sustainable whilst those within that society struggle to make ends meet.

Is it not time for a serious look at what banking is and what it stands for? What does it deliver to society and how does its current culture, values and ethics really match those of the society it serves.

The imbalance in the Banking, corporate conundrum made up of shareholder profit, customer value and societal expectations that exists is down to poor, unethical leadership. Leaders need to be far cleverer in balancing their delivery appropriately in each of the contributory areas. Those leaders will also need to live by the values they expound. The Banking industry is at a crossroad it is up to its leaders to rise to the considerable challenge of changing the culture and leading it into a new age.

SampsonHall

Good Leaders, Great Decisions

Sampsonhall.co.uk

As Coach Boone said in that film Remember the Titans:  ”If we don’t come together right now on this hallowed ground, we too will be destroyed, just like they were. I don’t care if you like each other of not, but you will respect each other. And maybe… I don’t know, maybe we’ll learn to play this game like men.”  Respect is the key catalyst that brings with it a fairness that glues individuals and teams together.

Respect is key in any cohesive group for without it trust will dissipate and teams will become a collection of individuals who function only for self gratification. Without respect the intrinsic bond that is so key to super success will never be found as team leaders and members focus on extrinsic reward. Look at those organisations that have tried to buy their way to success and failed.

Power used to be a key tenet to successful leadership but I am now of the opinion that today’s world is more about win win collaboration rather than the zero sum conclusion. Collaboration and mutual benefit are symptoms of maturing societies rather than the historical imposition of power and authority. As leaders become more ethical in their words and deeds societies judge them on their ability to balance profit for their shareholders, value for their customers with their brand’s expectations from society.

Ethical leadership is not about power and authority it is more about influence and motivation hence it is about fairness and diversity, compromise rather than power and destruction.

How the BBC, NHS, most high street banks and now some food producers must rue the day they decided it was all about profit, targets and bonuses.  Ignore the culture in your organization and you ignore it at your peril.

And all the retail brands who ignored their customer needs must regret doing some simple market research.

Lack of checks or possibly blatant disregard will be bringing down a number of food producers in the next couple of weeks.  The culture of not checking deliveries properly came from a culture of tacit acceptance, lack of communication and probably management bullying.  The culprits will undoubtedly be facing irreparable damage to their reputation and possibly a date in court.

Barclays announced today it’s closing its tax avoidance unit ‘in a bid to repair its battered reputation’.    How life could have been so different if they had thought about their brand and their customer first, rather than focus solely on profit.

Everyone knows that the Mid Staffs hospital scandal is merely the tip of the iceberg.  Stories such as we heard last week can be replicated in many other hospitals around the country.  We’ve all heard or experienced shocking levels of care – or rather lack of it.

The common denominator here is poor leadership.  Of course, business leaders have to make a profit.  But they need to value and give value to their customers  – and that includes listening to them.  And finally they need to think about their brand and their culture.  Get it right within the organization and you are someway down the road to getting it right for your customers.

So Sampson Hall say you should answer four simple questions about every business decision any leader makes.

Is it honest?

Is it fair?

Is it right for our brand?

Does it provide value for all involved?

If some of the above had addressed these issues, the current headlines would be very different

You only have to open a newspaper or switch your television on these days to see another example of a failure in leadership, banks are repeatedly the culprits with LIBOR and IRSAs, newspapers with phone tapping were and now its supermarkets and horsemeat. Even leaders of large retail outlets such as Jessops, Blockbuster and Comet have been susceptible. So why do I blame it all on leadership? Surely some of it is down to the environmental and societal changes?

Absolutely right to a degree, but it is the leader’s duty to ensure that the organisation at least keeps up with the environment that sustains it. Leaders must always be in touch with what is going on around them.

The Problem

The modern business leader has to balance three conflicting issues: the first is the requirement to generate profit for the organisation and its stakeholders; the next is the requirement to give value to customers so that they become advocates of and indeed return to the organisation whenever possible; the third aspect is what I call brand and culture this concerns the public and indeed self image of the organisation. It is how we do things round here when no one is looking. It involves values and ethics that need to be maintained and sustained. I am not advocating rigid traditions here but a set of clearly understood values and standards that are regularly reviewed for their relevance.

The Need

Modern Business Leadership is a difficult balance between organisational needs- profit, customers’ needs- value and societal needs- trust if we look at all the recent issues in business they have arisen where one of these issues has dominated the leaders thinking too much and the balance has been lost. Mostly its profit with the banks and the Horse meat, sometimes its value with Jessops and Comet and then its trust which is the one that is most difficult to rectify for before trust must come the truth! As society moves on our values have changed and matured. No more is it a zero sum game, today’s world is about win win for it is only then that an organisation has true longevity. A modern organisation has to balance its brand with its profit and its customer value.

Here are some questions a modern leader should always challenge a decision with prior to promulgating it.

Is it honest? Is it fair? Is it right for our brand? Does it provide value for all involved?

Commercial history tells us that the most successful organisations, over the long term, consistently focus on “enabling” people things (leadership, purpose, employee motivation) whose immediate benefits aren’t always clear in the short term. These robust organisations are internally aligned around a clear and cohesive vision and strategy; can execute to a high quality thanks to strong capabilities, management processes, and employee motivation; and renew themselves in an ever more demanding environment more effectively than their rivals do. In short, healthy processes today drive improved performance tomorrow.

The issue in the majority of the larger organisations is the short term requirements placed upon them by their shareholders. Many Chief Executives and Senior Vice Presidents instinctively understand the paradox of performance and health, though few have expressed or acted upon it better than John Mackey, founder and CEO of Whole Foods. “We have not achieved our tremendous increase in shareholder value,” he once observed, “by making shareholder value the only purpose of our business.” No most certainly not and yet the increase in value has been long term it has been as a result of healthy strategic processes and disciplines. Outstanding strategy, effective communication and the evolution of people processes to free up mangers and leaders to focus on the future rather than immerse themselves in the problems of today. Don’t forget that people run businesses and people are the interface between a business and its customer base if they feel empowered, understand what they have to do and the route they have to take to get there, then they can create extraordinary value and longevity!

In today’s business world if you are a business leader you have two choices. You can shape your destiny or let fate take you to the destination it chooses. All too often we come across businesses that have taken the second option and found they are in a place that they did not want to be.  It’s a tough world out there with a rapidly changing environment with lots of competitors chipping away at your business. You need to ensure your business survives and flourishes through proper planning and preparation. Having some sort of Strategy that includes a vision of where you want to get to. An understanding of what might stop you. An idea of the team you would like to assist you on your way and a means of allocating your scarce resources to the most important aspects of your plan.

There is a time and place for each of these disciplines   but you need to understand the where and when and how and bring all of these disparate activities together into one coherent strategy.

So how do I put together my strategy and where do I start?

Like all good stories you need to start at the beginning by understanding your personal requirements and how these can be met by your business. There is little separation in today’s fast moving world between home and office.  This entails asking yourself lots of questions. What is it you want to achieve? (Vision) How will you do this? (Plan) Whose help and guidance do you need? (Talent Management) What resources will you need?  How much will it cost? What’s my time frame to achieve this? (Resource Priorities and Risk Management)

Hone your answers at each stage of the process by continually asking one of the most important but rarely used questions – WHY? Sometimes its best asked five times to get to the real issue or desire!

That’s a lot to take in if you’re also spending most of your time on day-to-day operational business matters. Sometimes it pays to bring someone in from outside your business to look at your strategy with fresh eyes and there are plenty of consultants who can do this. Some may also assist in the implementation of your strategy as you focus on the day to day activities. After all we all work far too much “in rather than on” our business.

But in the words of Rick Page “Hope is not a strategy” Start shaping your future to ensure that you get your business to the place it needs to be to give you the life you want!

What is value? Value is an individual perception. It comes from an individual’s expectations which are founded in their own experience and beliefs. Value put simply is the positive difference between someone’s’ expectation and reality. Just as a lack of value is the negative difference between expectation and reality.  So value comes in all sorts of shapes and sizes and it is here that companies need to get cleverer in their delivery of something. Value will last as long as the item is around it is not just about shiny and new products.

Value needs to be measured through the life of a product. It needs to be measured in all sorts of ways to match the expectations of the audience that is trying to assess it.  Long Term Value is no longer about initial cost but it is also about through life costs and disposal costs, it is also about the environmental impact, local economy impact, societal impact etc etc.

Clever companies are starting to focus their marketing on the other aspects of value that society considers important and those that don’t reflect the new principles of non-monetary value will soon find their market dwindling as they look only towards their own profit. Clever companies provide and measure the same value to their employees, after all how good is it to work for a company your proud of!