Published on March 13, 2014
THE EXCHANGE THE MAGAZINE FOR CUTTING EDGE PEOPLE STRATEGY M a n a g i n g i n t h e N February, 2014 N EE WW NN OO RR MM AA LL B A T T L E R O Y A L E : E S O P s v s 3 r d P a r t y S a l e D o e s F o r t u n e 5 0 0 C E O ’ s P a y R e f l e c t T S R ? A p p a r e n t l y N O T ! E m p l o y e e E n g a g e m e n t i n a MM II LL LL EE NN II UU MM WW OO RR LL DD P u t t i n g t h e H U M A N b a c k i n H U M A N R E S O U R C E S www.theexchangeforpeoplestrategy.com
F E B R U A R Y 2 0 1 4 1 5 T A L E N T M A N A G E M E N T Managing in the “New Normal” Submitted by Jay Wolf, Tim McConnell and Lindsay Armstrong 2 1 L I G H T I N G T H E F U S E : IGNITING THE POWER OF PEOPLE Putting the HUMAN Back in Human Re- sources Submitted by Jim Finklestein, FutureSense, Inc. 2 5 R E W A R D S Does Fortune 500 CEO’s Pay Reflect TSR? Apparently Not! Submitted by Main Data Group, Inc 3 2 R E W A R D S Key Watchwords in Long Term Incentive Compen- sation: Efficiency, Diversification and Performance Submitted by Stephen M. Kaufman, Fulcrum Partners 4 1 E S O P S Battle Royale: ESOPs vs. 3rd Party Sale Are ESOPs really more complex than other ways to sell a business? Submitted by SES Advisors, Inc. C O N T E N T S 2
F O R C U T T I N G E D G E P E O P L E S T R A T E G Y T H E E X C H A N G E B L I N D I N G G L I M P S E S I N T O T H E O B V I O U S : FROM THE PEOPLE SIDE OF INNOVATION & PARADIGM SHIFTS Identifying and eliminating unnecessary work will make space in your day for Innovation or New Projects Submitted by Marvin L. Smith, Deliberate Synergy 4 8 R E W A R D S WHAT’s an HR Title WORTH Anyways? Submitted by Michael Dennis Graham, Grahall, LLC 5 5 H U M A N R E S O U R C E I N F O R M A T I O N S Y S T E M S Employee Engagement in a Millennial World Submitted by Christian Liakos, Bullseye Engagement 5 8 H U M A N R E S O U R C E I N F O R M A T I O N S Y S T E M S Is the CEO Paid Too Much? An Employee Perspective Submitted by Charles Patton, GRAHALL, LLC 6 0 R E W A R D S Two Benefits, One Old and One New Submitted by Robert D. Birdsell, Grahall/EBS 6 2 3
F E B R U A R Y 2 0 1 4 C O L U M N S 5 Letter from the Editor 6 Contributors 11 Bookstop: THE FUSE by Jim Finklestein, FutureSense, Inc. 12 January’s Shape of the Month: CEO Succession Planning We hope you enjoy our February issue of The People Strategy Exchange. Missed last month’s issue? Find it here at www.grahall.com/theexchangejanuary2014/index.html WHATS AHEAD FOR OUR NEXT ISSUE… As we continue our investigation of People Strategy we ask for your direct feedback about our endeavor. Please share your thoughts and ideas for stories, contribute to the discussion through our feedback options, most importantly SPEAK UP about what you want to read and better understand about how people strategy can drive your organizational performance and success. C O N T E N T S
Letter from our Editor… F E B R U A R Y 2 0 1 4 Letter from the Editor: From Punxsutawney Phil to Presidents Day, from Valentines to arctic vortexes, from the Olympic podium to the announcement that WhatsApp is worth $16 billion (what’s up with that?), from not leap year to NOT MORE SNOW! This month has left its mark across the country and around the world. News has been good as well as dire, heartwarming as well as heartbreaking; all in this, the shortest month of the year. In our second issue of People Strategy Exchange we continue our investigation of People Strategy and the components involved in creating successful and sustainable organizations. Our contributors frame important issues and considerations for you, our reader. We invite you again to peruse our magazine. You will find information on Long term Incen- tive Compensation, how CEO salaries compare (unfavorably) to total shareholder return, leadership in our new normal economy, successfully engaging the burgeoning employee group of millenials, along with a new and more effective approach to non-qualified deferred compensation. Contributors also provide perspectives on how to right size your personal workload, and how to improve organizational sustainability by putting the “human” back into human resources. If you missed the January issue you can access it by clicking on the January emagazine cover below. If you have questions, comments, or observations about our content or our contributors, or more importantly if there is a topic, an industry, or an issue you want us to delve into, please let us hear from you. All the best, link to our INAUGURAL ISSUE of People Strategy Exchange January 2014 Edie Kingston Elizabeth B. Hall E D I T O R I N C H I E F C R E A T I V E D I R E C T O R 5
We are thrilled with the articles and insights provided by our contributors for our second issue of PSX. T h i s M o n t h ’ s C o n t r i b u t o r s T H E E X C H A N G E / F E B R U A R U 2014 The contributors include: Christian Liakos, VP Alliances & Business Development at BullseyeEngage- ment. Christian has twenty years of experience in strategic alliances and direct sales in the hardware, software and technology space. Currently, he is responsi- ble for building a partner ecosystem that will leverage and provide additional value to BullseyeEngagement’s employee and operation performance solutions. Christian’s prior work encompasses various industries and buyers including VARs, eProcurement/supply chain, to telecommunications, and Human Re- sources. Links to reach our Contributors: Bob Birdsell, Managing Director for Grahall/EBS. Grahall/EBS is a firm specializing in the discovery of new and innovative executive benefit pro- grams designed to replace existing plans which have become obsolete in the current regulatory and tax environment. Bob has invested the last 25 years of his career in assisting organizations in creating, implementing, and administering state of the art benefit programs for organizations in numerous industries. From StephenM.Kaufmancomes the article Key Watchwords in Long Term Incentive Compensation: Efficiency, Diversification and Per- formance.. Stephen M. Kaufman is Managing Director of Fulcrum Partners, LLC, the nation's leading executive benefits consulting firm, in Houston, Texas. He can be reached at Stephen.Kaufman@fulcrumpartnersllc.com or 713/623- 8700. Jim Finkelstein will pen a monthly column for PSX titled “Igniting the Fuse”. For this February issue Jim writes about Putting the HUMAN Back in Human Resources. Jim, President & CEO, FutureSense, Inc., has over 37 years of consulting and corporate experience, and has specialized in business and people strategy, motivation and re- ward, and organizational assessment, development, communications, and transformation. Jim’s experience has included being a Partner in a Big Five firm; a CEO of a professional services firm; a corporate execu- tive for Fortune 500 companies; and an entrepreneur with his current company, FutureSense, Inc. 6
C o n t r i b u t o r s T H E E X C H A N G E / F E B R U A R Y 2014 Michael Graham Michael leads Grahall Paid Fairly and Grahall HR Access. Grahall is an intellectual capital firm whose comprehensive services help organizations maximize the value ex- change between organizations and individuals.. Michael Graham has over 38 years of experience in the compensation and benefits field ad- vising organizations in all industries. Last month, Michael penned the profile of MicroSoft (The Big Truth about MicroSoft), the People Strat- egy Revolution article, and Predictions for the Future, which can be found at www.theexchangejanuary2014/index.html Links to reach our Contributors: From Craig Main of Main Data Group, Main Data Group is a provider of high-resolution executive compensation data. We have a robust cloud-based platform which streamlines peer comparison work for compensation profes- sionals. Our breadth-of-data and ease-of-use go above and beyond what is offered by any other product currently available. To learn more about Snapshot Data™ or to request a free two-week trial, e-mail us at firstname.lastname@example.org or call us at (408) 776-1000 x106. Marvin Smith of Deliberate Synergy offers the second in his series of “Blinding Glimpses into the Obvious” with a discussion of Identifying and Eliminating Work to Make Space for Innovation. Deliberate Synergy puts innovation into practice with people, strategic initiatives and incentives that foster sustainability. Marvin has 30+ years of ex- perience in facilitative consulting that covers all aspects of innovation. Including those who have direct responsibility, leadership and the cul- ture and skills needed to cope with 21st century complexities. James Steiker provides a compelling look at how ESOPs can help entrepreneurs to plan and manage the sale of their business in a way that supports their financial, tax, organizational, personal and legacy objectives. Jim is Chairman and CEO of SES Advisors, Inc. and Founding Partner of its sister law firm, Steiker, Fischer, Edwards & Greenapple, P.C. He is a corporate, pension and tax attorney and fi- nancial advisor with more than 25 years of experience in Employee Stock Ownership Plans (ESOPs) and other employee ownership mat- ters, focusing primarily on ESOP design, transactions and compliance in entrepreneurial companies. Jim is the immediate past Chair of the Fi- nance Committee and currently serves on the Board of Governors of The ESOP Association, a trustee of the Employee Ownership Foundation and a member of the Board of Directors of the National Center for Employee Owner- ship. He is a frequent speaker and author on ESOP matters and serves as a director of eight ESOP companies. 7
C o n t r i b u t o r s T H E E X C H A N G E / FEBRUARY 2014 Links to reach our Contributors: TimMcConnell is an HR Strategist and Organizational Architect with McConnell HR Consulting Inc. of Ottawa and New York. Tim can be reached at Tim@McConnellHRC.com. Jay Wolf is President of the JCris Consulting Group in New York. Jay is a former Peak Performance Coach at the Center for Enhanced Per- formance at the United States Military Academy at West Point, New York. He can be reached at Jay@jcrisconsultinggroup.com. LindsayArmstrong is an HR and Organization Design Consultant with McConnell HR Consulting Inc. of Ottawa and New York. Lindsay can be reached at Lindsay.Armstrong@McConnellHRC.com. Charles Patton submitted Is the CEO Paid too much? An Employee Perspective. Charles leads Grahall’s Online Solutions business. He specializes in all aspects of reward strategy, executive compensation, including equity-based compensation, short-term and long-term cash incentive/retention compensation, executive employment arrangements, benefits and development rewards. 8
R e l e a s e s t h a t d e s e r v e a place “FUSE is the perfect guide to becoming more savvy about getting hired and working together effectively in the twenty- first century. A quick read with rapid results, no matter what generation you belong to.” Ryan Healy COO and CoFounder fo Brazen Careerist, Inc. “ FUSE is an important book. It presents the challenges we see between the lagging workforce and the leading work- force, gives readers lots of signposts to recognize in their own organizations, and draws a road map for some specific steps we can take with our employees of the future. A lot of today’s media on the subject of the workplace and the work- force focus on polarization. This book champions fusion, and gets it just right, with practiced advice, humor and vi- sion. Message received. “ Sherry Benjamins President and CEO of S. Benjamins & Company, Inc.
FUSE is a book about combining the knowl- edge, experience and perseverance of 20th century workplaces with the speed, digital in- telligence and global view of 21st century workforces, to ignite a high-productivity and profitable future for our organizations. Backed by extensive research and contributions from a multi-generational team, FUSE offers real- world solutions to common concerns and fric- tion points in the new Cogenerational Work- place.™ A concise guide to a complex topic, it is enter- taining, thought-provoking and, most of all, useful in making sense of the changing world of work for everyone from college students to C-level executives. FUSE speaks particularly to today’s Boomer bosses and entry-level Mil- lennials, who are often polarized in perception and in practice. In topic-focused chapters, it shows that a Millennial/Boomer mashup – not a gap – but a fusion of their unique and spe- cific perspectives and abilities, can lead to in- novation and speed products, services and people into a more productive future. This unique material is enhanced by a chapter on the future of the workplace that lays out the management challenges of an increasingly fragmented and “just-in-time” workforce, and a chapter by a top Internet strategist detailing the “how-to” and the true value of using social media and networking in organizations. FUSE is a roadmap to the major attractions and hidden talents of both generations; a training book for beleaguered Boomers and frustrated Millennials; an instruction manual for anyone wanting to attract, motivate and retain employees, or to contribute the full range of their talents to their organizations; and a good read. t h e b o o k s t o p on your bookshelf “ FUSE is as timeless and enduring as Passages by Gail Sheehy. It is as infor- mative about adult development (yes, Millennials in the workplace are adults) as The Seasons of a Man’s Life by Daniel Levinson. It is an outstanding book. Prepare to be enlightened, engaged, amused and delighted.” John Caple Author of Finding the Hat That Fits 11
It’s proxy season! Here is something extra to watch for. From a representative sample of 1,000 or- ganizations cut from all of the companies listed on the various stock exchanges in the United States approximately 1 out of 5 doesn’t have a CEO succession plan that has been approved by the Board of Directors. One can only guess the reasons: a)The CEO has just been hired and it is uncomfortable for the Board to discuss succession, b)The CEO is young or just taken over and intends to be there a long time, c)The Board has an informal plan but it hasn’t been approved by the Board (or maybe the CEO) d)The Board wishes to emulate Microsoft and let the process of choosing the CEO be a publicity disaster e)The CEO has convinced the Board that he is immortal f) All of the above. For more information on CEO Succession Plans, visit www.grahall.com/knowledge/book-shelf to find the Board of Directors Governance & Rewards book written by Michael Dennis Graham, Grahall, LLC S H A P E O F T H E M O N T H : What do 20% of the Publically Listed Companies have in Common with MicroSoft? THEEXCHANGEFORPEOPLESTRATEGYwww.theexchangeforpeoplestrategy.com …Answer…They do not have Board Approved CEO Succession Plans… 12
The 2014 Survey Is Now Open! Start the Questionnaire >> Click on any of these images To buy your copy of the 2013 People Strategy Survey 13
T H E E X C H A N G E F O R P E O P L E S T R A T E G Y F E B R U A R Y 2 0 1 4 By Jay Wolf, Tim McConnell, and Lindsay Armstrong This article examines the changes and impacts that have affected the economy during the past five years. The authors address how leaders and organizations have shifted, and must shift, in order to survive and grow going forward in this new environment. M A N A G I N G I N T H E “ N E W N O R M A L ” What we have experienced was not merely another turn of the business cycle, but a major restructuring of the economic order. (i) The Economy 2008 was when things started to change. In fact, many people have flagged an exact date for this - September 15, 2008; when financial services giant Lehman Brothers filed for Chapter 11 bankruptcy protection. This remains the largest bankruptcy filing in history. It precipitated several crises in the financial and housing markets, major plunges in the stock market, and the “Great Recession” which followed. Since the start of the recession, 8.8 million jobs have been lost in the U.S, according to the U.S. Bureau of Labor Statistics. Employers normally start to hire again once a recession has ended and the economy begins to grow again. However, we are not seeing this – prompting another new term, “the jobless recovery”. This has become an era in which employment is unstable, and in which being either underemployed or unemployed is a common aspect of life for many people. “The longest and worst recession since the end of World War II has been marked by the weakest recovery from any U.S. recession in that same period.” (ii) 15
A jobless recovery is an economic phenomenon in which a macro economy experiences growth while maintaining or decreasing its level of employment. The Wall Street Journal reports that more people left the workforce than got a new job during the recession / recovery – by a factor of nearly three. In fact, the Labor Force Participation Rate is down to 63.5% (from a usual average of 68%). To make things worse, many new jobs are part-time and / or in the lower paying service sector. (iii) So what does this mean for organizations, leaders and managers in 2014? The “New Normal” The “New Normal” is a term that has been around for a few years now. For example: “The New Normal”. (McKinsey & Company Quarterly, March 2009). “The New Normal – HR Trends in 2010”. (HR Professional magazine, HRPA, February 2010) “The New Normal Requires a New Mindset”. (Ivey Business Journal, July/August 2010) “Talent Management for the New Normal”. (Business Financing magazine, March 2011) “Leading in the New Normal”. (Impact International, webinar, October 2012) “The New Normal Leadership”. (Meeting Professionals International – Minnesota, November 2013) So what were they saying? What is this “New Normal” thing? How is it different from the Old Normal? The New Normal describes the state of doing business today. “We face a tidal wave of change that is relentless and moving at high speed. The pace is so fast that it has rendered many tried-and-true leadership approaches and systems either grossly underpowered or totally ineffective.” (iv) In the past, many companies achieved success simply by riding market growth. We now face the prospect of slow growth for many years to come combined with globalization and intense competition from developing economies. Managing in this new era will require CEO’s and their executive teams to stray from their comfort zone and challenge traditional ways. Traditional views (i.e. slow, steady and risk- averse) about business models – from research and development and product design to manufacturing, sales, marketing and government relations – will have to be ‘jettisoned’ in favor of a more flexible quick-response mindset. (v) How do we manage in the New Normal? MANAGEINGINTHENEWNORMALTHEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 We believe that it is all about re-thinking and re-learning how to be competitive… 16
Leadership and TALENT in the New Normal It starts with leadership. In the New Normal it is imperative that your leaders have a vision of what they wish to accomplish. This definition of success should be authentic to them and not based on what others are doing or what the market expects. It does take special leadership and culture to compete and win in the New Normal. Leaders can’t be afraid to set a vision and be held responsible if the vision does not work out. Competition in the New World then is defined as achieving that vision, as opposed to following or keeping up with another’s. There are two reasons why many leaders find it difficult to operate in the New Normal and evolve with this morphed definition of competition: In the New Normal it is imperative that leaders have a vision of what they wish to accomplish. 1. Some leaders are not top notch (frankly) – they don’t have their own vision. Their view is on the other guy. They compete against other people or organizations in the marketplace because this is the way it has always been done. 2. Many CEO’s understand the concept of the New Normal, but feel they can’t change the people they have in place. Their current workforce will not or cannot operate in an environment that is more competitive. They won’t change. They need a workforce that will support their vision. This leads to our next point. Talent Management in the New Normal A visionary leadership will be most successful in the New Normal if they are able to weave into their workforce individuals who possess “autotelic” capabilities. In our recent (May 2013) article “Is Your Organization Designed for Battle?” (vii) we introduced the term ‘autotelic’ and applied it to management and leadership. Autotelic is a word composed of two Greek roots: auto (self) and telos (goal). It refers to an activity having an end or purpose in itself. Autotelic people are internally driven and exhibit a strong sense of purpose. University of Chicago psychologist Mihaly Csikszentmihalyi has written on the concept of the autotelic personality. He describes it as a state of intrinsic motivation in which a person is fully immersed in what he or she is doing for the sake of the activity itself. It is characterized by a merging of action and awareness, a sense of control, high concentration, loss of self- consciousness, and the transformation of time. Characteristics associated with an autotelic personality include curiosity, persistence, and humbleness. (x) The mark of the autotelic personality is the ability to manage a rewarding balance between the ‘play’ of challenge finding and the ‘work’ of skill building. (xi) 17
Autotelic capabilities in knowledge-intensive organizations are significant attributes in a New Normal world. They create strong competitive advantage. Greek engineer Glykeria Karagouni has written on the new application of autotelic capabilities to organizations and management. (Individuals with) Autotelic capabilities are responsible for the shaping of emergent conditions by creating and not simply discovering opportunities. They engage in exploration out of the boundaries of the firm and usually even of the industry. (viii) Karagouni says that autotelic capabilities in knowledge-intensive ventures create strong knowledge-based competitive advantages in order for organizations to survive and prosper in an open economy (i.e. the New Normal). He writes that the dimensions of autotelic capabilities are bricolage (building with the materials at hand), improvisation and transcendental abilities. It is our position that autotelic capabilities and personalities are core competencies for managing in the New Normal. Employees with these competencies need to be effectively selected, managed, motivated and retained. Competition in the New Normal will be never ending, and faster paced. What we have come to know as State-of-the-Art competitive standards have gravitated to essential practices, but not leaders, in the arena. Leading edge competitive analysis techniques relied upon in the Old Normal are still necessary in the New Normal, but will now only play a supporting role to a company’s VISION. Let’s look at what this means in three aspects of traditional competitive analysis, their pros & cons in the New Normal. The integration of individuals who demonstrate autotelic skills, will influence the manner of selection of resources and skills. They are strategic higher-order capabilities since they enable the shaping of the entrepreneurial ecosystem, aid in the creation of competitive advantage, and assist managers to select priorities and make relevant strategic decisions. (ix) MANAGEINGINTHENEWNORMALTHEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 Supportive and LEADING Competitive Analysis in the New Normal 18
Benchmarking Benchmarking - spending time looking at what other organizations are doing - looks to the external market for self-validation - as your standard of success. Benchmarking is effective in helping you understand what other people are doing. It can help with your vision but should not be the basis of your vision. If you are always comparing yourself against other organizations, concern might be raised that you do not have visionary leadership in place. Used alone, benchmarking could hinder your organization from creating its own definition of success. Surveys Surveys are useful as a support for your vision but not as a lead function. The speed of business has increased significantly. If there is an issue and all we do is survey and gather information; by the time we have gathered, analyzed and dealt with results, organizations have moved on and that issue may not be relevant anymore. Research This is important but what are you researching? You generally research the past. Too much researching of the past does not allow for present or future innovative thought and disruptive thinking. You need to shake up the status quo in order to create your definition of success. The view of ‘competition’ shifts from ‘what the other guy is doing’ to what we have to do to achieve our vision of success. Leading Edge Competition in the New Normal In the New Normal, if the right leadership is in place, and you have your own vision of success for your organization, you can create power goals to achieve that success. Working with CEO’s, the first question consultants ask is - what is your vision of success? Often CEO’s can’t answer this question because they are not visionary or are unsure. So, they stick to the old way (benchmark, research and survey) and lead from behind. If you follow, how can you win or come out ahead? Organization design is the way a company is structured in order to achieve its business strategy. It is all about alignment; the full and complete alignment of skills, positions, functions, processes and operations with corporate priorities. It is the creation of a willed future. Organization Design in the New Normal In his book entitled ‘Board of Directors Governance & Rewards’, Michael Graham postulates that there are six stages in a typical company life cycle: Start-Up, Emerging, Growth, Established, Mature, and Declining. (vi) Each stage requires a separate style of leadership and Board governance. Studies in the book demonstrate that young companies which endure the first three stages are generally very competitive. They have to be to survive. Established and Mature companies, on the other hand often begin to decline because they become complacent . In these organizations, winning and competition become dirty words. Mere participation in the business is rewarded and just showing up is enough. It is easier for many people to passively participate in the work place. Mediocrity is accepted. In the New Normal this won’t work anymore. Successful businesses are no longer functioning that way. 19
In the New Normal, organization design must take on more innovative approaches, shapes and forms. Both traditional and non-traditional elements of design must be considered as organizations look to the future. Truly effective organization design is a never- ending process. It is adaptive and dynamic, not static. Do you have the right organization design in order to compete for success? What happens when a leader is operating in the New Normal but his/her organization is a calcified bureaucracy still living in the Old Normal? It is hard for companies to be fast, responsive and innovative when their organizational structure is complicated and territorial. This happens in the Old Normal when organizational charts are built only around titles and functions and not mission critical, vibrant business processes. In the New Normal, organizational structures must be streamlined, simplified and focused on what is truly important: the four key business outcomes – productivity, profitability, staff retention and customer loyalty. (xii) Conclusion Managing in the New Normal will be an extraordinary experience. Our economic environment is a given, so it should be viewed not as a hindrance but as an opportunity, a catalyst for change. Use it to your advantage. Differentiate yourself. Break free of the constraints of the Old Normal. (xiii) ▪▪ Jay Wolf, Tim McConnell, and Lindsay Armstrong Make your organization a master, not a victim, of uncertainty. (xvi) END NOTES i. Davis, I. “The New Normal”. (McKinsey & Company Quarterly, March 2009). ii. Zuckerman, Mort. “A Jobless Recovery is a Phony Recovery”. (The Wall Street Journal, New York, July 15, 2013). iii. Ibid. iv. Ducoff, Neil. “The New Normal Org Chart”. (No-Compromise Leadership Blog, WordPress, November 2011). v. Rhodes, David & Stelter, Daniel. “The New Normal Requires a New Mindset”. (Ivey Business Journal, July/August 2010). vi. Graham, Michael. Board of Directors Governance & Rewards. (Grahall LLC OmniMedia Publishing, Boston, 2013). vii. Cris, J. & McConnell, T. “Is Your Organization Designed for Battle?” (Human Resources Professionals Association – Ottawa Chapter newsmagazine, Up-Date, May 2013. viii. Karagouni, G. & Caloghirou, Y. “Unfolding Autotelic Capabilities in Low-Tech Knowledge-Intensive Entrepreneurship”. (Journal for International Business and Entrepreneurship Development, Volume 7, Number 1, February 2013). ix. Ibid. x. Csikszentmihalyi, M. (1990). Flow: The Psychology of Optimal Experience. (Harper and Row, New York, 1990). xi. Ibid. xii. Ducoff, Neil. “The New Normal Org Chart”. (No-Compromise Leadership Blog, WordPress, November 2011). xiii. Ducoff, Neil. “The New Normal Org Chart”. (No-Compromise Leadership Blog, WordPress, November 2011). xiv.Benton, Jeremy. “Leading in the New Normal”. (Impact International, Webinar, October 2012). In the New Normal, ORGANIZATION DESIGN must also take on more innovative approaches, shapes and forms. If you are an organization still playing by the old rules, know that the game has changed or you won’t be successful. MANAGEINGINTHENEWNORMALTHEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 20
LIGHTING THE FUSE: IGNITING THE POWER OF PEOPLE By Jim Finkelstein, FutureSense, Inc. When you ask yourself or others why you work, does the answer not stare back at you with a blank smile? You smile because you know you have to work. But the smile is blank because you have no idea why you have to. Do you have to work to survive? Or do you work because it’s enjoyable and meaningful? For most, the value of work has become so utilitarian – making money to pay for bills – that we have taken all meaning out of it. The financial crises beginning in 2007 stimulated changes across the board for work and life. Corporate scandals, corruption, greed, housing crises, bailouts and bonuses have all become acronyms. Employees – people – have become disposable. Why have we let this happen? And, more importantly, why do let this continue to happen? Contemporary Human Resource circles claim to focus on both the human and the resource, however these claims are just not true. They view their employees as “capital to be invested in” or “resources to be utilized” (aka depleted). This mechanistic/industrial model has forced us to abandon fundamental values about how we treat other humans. The American population actually P u t t i n g t h e “ H U M A N ” B a c k i n HHuummaann RReessoouurrcceess 21
reached its peak happiness in the 1950s and has steadily declined since. An ultimate low point has been undoubtedly reached with the current recession. What we need is a new paradigm to the way we view work – one that we are all calling for in our hearts and souls. We have placed enough attention on the resources side and need to bring back the human in HR. This will bring about a more engaged workforce, further stimulating the economy and our quality of life. Believe it or not, the industrial model never left and still prominently exists as the dominant paradigm of work and life in the West. At its onset in the early 1900s, the model presented companies with mechanized improvements offering increased efficiency and productive capacity. In the late 1900s and early 2000s, another transition occurred – the Technological Revolution or Information Age. But, the same set of industrial rules and culture applied. Workers again fled one site for another, leaving the factory for the office cubicle where computers replaced hand tools, clocking in 9-5 under the watchful eye of their superiors. They processed paper work, wrote program codes, or developed marketing schemes. They received employee identification numbers along with sets of guidelines and instruction manuals. Their role within organizations existed as component parts of a system. The problem with this still-continuing industrial model is two-fold: 1) It relies on the perception that endless growth and progress – dependent upon inexhaustible resources – is needed to secure the future of human society 2) Component parts – whether human or machine – must be maintained … the companies that are thriving not only have a tight business plan and immensely valuable services…they are bringing back the human in Human Resources, recognizing that their workers have needs, feelings, and goals in life. … They are valuable members of an organization or a community working towards a common goal. They form relationships with each other and develop true senses of teamwork and collaboration. THEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 22
THEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 We know now that planetary resources are, in fact, finite and limited. You cannot have infinite growth on a finite planet. We also know that human beings are not mechanized parts of a system and seek further goals in life. Can we really accept that this system is working? Charles Darwin, in his theory of natural selection, was often misquoted as saying evolution is driven by “survival of the fittest.” What he actually meant to say, correcting himself later, was that it is driven by “survival of the most responsive to change.” Currently, the companies that are thriving not only have a tight business plan and immensely valuable services, but are also changing back to an older, kinder model of workforce engagement. They are bringing back the human in Human Resources, recognizing that their workers have needs, feelings, and goals in life. What this new model is straying away from is the treatment of employees as components of a system. They are no longer just numbers or working parts. They are valuable members of an organization or a community working towards a common goal. They form relationships with each other and develop true senses of teamwork and collaboration. This new paradigm is a boomerang thrown into the wind because it challenges the status quo and the establishment. Things are changing inevitably, so it is up to all of us - including our leadership – to adapt so that we may thrive. Perhaps it is time to (re) enter the Human Age. - Jim Finkelstein
T H E E X C H A N G E f o r P e o p l e S t r a t e g y F E B R U A R Y 2 0 1 4
F r o m I n f o t o I n s i g h t by main data group, inc.. A p p a r e n t l y n o t ! Does Fortune 500 CEO’s pay reflect TSR? Aligning compensation with actual performance, and communicating a working pay-for-performance strategy to shareholders are among the primary concerns of many companies when designing pay packages and CD&A disclosures, and for good reason. An inability to provide clear links between pay and company performance can erode confidence in a company’s long-term commitment to its shareholders and the soundness of board decision-making. While evaluation of pay for performance on a broad scale provides less detail, it is always valuable to examine data in a larger context, especially for companies hoping to maintain competitive practices in compensation. Our goal in this research article was to determine how closely CEO pay tracks various metrics of company performance in the Fortune 500 as a group, providing an overview of alignment among the largest public companies. 25
T H E E X C H A N G E f o r P e o p l e S t r a t e g y F E B R U A R Y 2 0 1 4 TSR Pay Alignment A central issue for companies seeking to develop strong pay-for-performance strategies and effective proxy disclosure is finding appropriate measures of corporate success. Total shareholder return (TSR) and other stock price measures are often considered key indicators of success for public companies, but a company’s stock price depends heavily on market conditions and other factors that are largely outside the control of company management. The scatter chart in Figure 1 displays a point for each company in the Fortune 500, with TSR rank within the group along one axis, and CEO pay rank along the other. Figure 1: CEO Total Reward vs. Company TSR Company TSR achievement has no bearing on CEO pay among Fortune 500 companies as a group, as indicated by the essentially flat trend-line in the above chart 26
Despite the fact that an overwhelming majority of long-term incentive grants to Named Executive Officers (NEOs) include TSR as a metric, this measure turns out to be a poor indicator of pay alignment. There were a number of companies in the group with strong TSR to pay alignment, examining the Fortune 500 as a group reveals essentially no correlation at all between TSR achievers and high earners. CEOs at companies with very high TSR are no more likely to have above-average compensation than those at companies with very low TS Despite the fact that an overwhelming majority of long-term incentive grants to Named Executive Officers (NEOs) include TSR as a metric, this measure turns out to be a poor indicator of pay alignment. There were a number of companies in the group with strong TSR to pay alignment, examining the Fortune 500 as a group reveals essentially no correlation at all between TSR achievers and high earners. CEOs at companies with very high TSR are no more likely to have above-average compensation than those at companies with very low TS 0100200300400500 0 100 200 300 400 500 Company Revenue Rank CEO Pay Rank CEO Pay vs. Revenue R.R. RevenueRevenue By nature, financial performance measures provide a better reference point for evaluating executive performance than TSR, but they also align more closely with actual pay. Metrics from company income statements logically yield better results because revenue and earnings achievements are more directly affected by management decisions. By nature, financial performance measures provide a better reference point for evaluating executive performance than TSR, but they also align more closely with actual pay. Metrics from company income statements logically yield better results because revenue and earnings achievements are more directly affected by management decisions. Figure 2: CEO Total Reward vs. Company Revenue CEO total reward tracks company revenue much more closely than TSR, with significant alignment along the broad median range of pay and revenue achievement within the Fortune 500. road median range of pay and revenue achievement within the Fortune 500. Figure 2 compares CEO pay rank with revenue for each company in the Fortune 500. As a group, Fortune 500 CEO pay aligned with revenue achievement to a greater degree than with TSR. This finding is hardly surprising given that a company’s placement on Fortune’s list is dependent on revenue, but it is still worth noting that the higher a particular company ranks in terms of revenue, the higher its CEO pay generally ranks as well. Figure 2 compares CEO pay rank with revenue for each company in the Fortune 500. As a group, Fortune 500 CEO pay aligned with revenue achievement to a greater degree than with TSR. This finding is hardly surprising given that a company’s placement on Fortune’s list is dependent on revenue, but it is still worth noting that the higher a particular company ranks in terms of revenue, the higher its CEO pay generally ranks as well. 27
Revenue represents the least refined and least complex measure of a company’s financial performance, and while it provides a sound baseline measurement for pay alignment evaluation, further insight is provided by considering financial metrics found elsewhere in the income statement. Net Income Income measures prove to be more dependable indicators of CEO compensation for the group studied. Figures 3 and 4 compare CEO pay with net income and operating income, respectively. Compared to the revenue chart in Figure 2, Figure 3 shows a slightly stronger correlation between net income and CEO pay. Figure 3: CEO Total Reward vs. Company Net Income Among Fortune 500 companies, net income is a slightly better indicator of CEO pay than revenue, but there is still a significant number of companies at the opposite extremes of pay rank and company performance. Net income is also a more relevant metric of CEO effectiveness than revenue or TSR, taking into account not just the CEO’s ability to drive sales, but also how well the company controls expenses under his or her leadership. Net income is commonly used as a performance metric in short-term incentive plans, and it logically follows that it would be relatively well-aligned with compensation. However, because net income is inclusive of extraordinary and non-recurring events by nature, it may not always accurately reflect the ability or decision-making of company leadership. 0100200300400500 0 100 200 300 400 500 Company Net Income Rank CEO Pay Rank CEO Total Reward vs. Net Income 28
Operating Income There are more below‐median companies with high CEO pay than there are above‐ median companies with low CEO pay. 0100200300400500 0 100 200 300 400 500 Company Operating Income Rank CEO Pay Rank CEO Total Reward vs. Operating Income Operating income represents a key balance as a pay alignment metric, accounting for the real-world financial performance of each company while remaining primarily focused on factors that are under the control of executive management. Interestingly, of the company performance metrics studied by Main Data group for this report, the balance offered by operating income produced the largest (most statistically significant) correlation between any single metric and the size of CEO pay. Figure 4 shows tight alignment between operating income and CEO pay, with a majority of companies ranking consistently between the two. It is also a common choice for use as a performance metric in executive incentive pay plans, and it is a very strong predictor of CEO pay in the Fortune 500 group. Conclusions Figure 4: CEO Total Reward vs. Company Operating Income In the Fortune 500 as a group, a company’s rank by operating income is a strong indicator of its CEO’s total reward, making it a strong candidate for use in evaluating the efficacy of pay alignment strategies. Interestingly, the observable trend for all pay comparisons was that CEO pay rank for a particular company is generally higher than company performance rank; as company performance increases relative to the group as a whole, CEO pay compared to the group increases too, but disproportionately quickly. In other words, there are always 29
more below-median performers with high CEO pay than there are above-median performers with low CEO pay. Despite radical differences between each metric in the degree of pay alignment for the Fortune 500, some things were consistent across different metrics in the study. With the exception of TSR, higher relative performance was always linked with higher CEO pay to some degree, and for the income metrics included in this report, the correlation was quite significant. Tracking and targeting appropriate pay alignment on a company or individual executive basis is an essential aspect of a strong overall compensation strategy, but it is always valuable to keep an eye on the competitive market as a whole. Book a demo with Main Data Group to find out more about Snapshot Data™, and see how your company’s pay strategies compare to those of your peers. With another proxy season quickly approaching and compensation advisory votes just around the next corner, awareness of market trends will prove to be an invaluable asset for any competitively-minded company. ▪▪ A central issue in developing strong pay‐for‐performance strategies is finding appropriate measures of corporate success. About the Research This article is based on compensation data gathered by Main Data Group on CEOs at Fortune 500 firms and is one in a series focusing on CEO and CFO pay at the largest public companies. Information and analyses in this email were developed using our Snapshot Data™ executive compensation benchmarking tool. © Main Data Group, Inc. 2014. (408) 776 – 1000. www.maindatagroup.com T H E E X C H A N G E f o r P e o p l e S t r a t e g y F E B R U A R Y 2 0 1 4 30
WELCOME TO PAIDFAIRLY.COM Are you being paid fairly? Search our FREE Online Salary Survey to learn what you should be getting paid. Compensation touches our lives in more ways than we imagine. It determines what house we live in, car we drive, college our kids attend, vacations we take, our ability to retire on time and how we live our lives. Therefore, it is very important to know if you are being paid fairly. Paidfairly interpolates and then extrapolates real employer-reported salary data points based on revenue, industry and location. In turn, helping anyone gauge their current salary or a potential salary offer, and know if they are being paid fairly. OUR ONLINE SERVICES ONLINE JOB DESCRIPTIONS ONLINE GEOGRAPHIC DIFFERENTIAL DATA MARKET PRICE YOUR JOB MARKET PRICING FOR BUSINESSES OUR OTHER NETWORKS ABOUT US CUSTOM ANALYSIS RESEARCH REPORT & SURVEYS Company Research CONTACT US
By Stephen M. Kaufman Fulcrum Partners K E Y W A T C H W O R D S i n L o n g T e r m I n c e n t i v e C o m p e n s a t i o n As the U.S. economic recovery gathers steam, executive retention will again be a key issue for Compensation Committees, even in the midst of increasing scrutiny over executive pay. In this environment, a powerful opportunity exists for companies to rethink their philosophies regarding significant portions of their total rewards packages. In so doing, they should have in mind three key watchwords in Long-Term Incentive (LTI) compensation: Efficiency, Diversification and Performance. Efficiency, Diversification and Performance Quick Look: The return of a more robust and competitive U.S. business environment-- in the midst of increased scrutiny over executive pay--creates a powerful opportunity for companies to rethink their philosophies regarding significant portions of their total rewards packages. 32
To maintain LTI compensation as a competitive tool, companies have eliminated or replaced stock options or moved to 100-percent restricted stock or a mixture of options, restricted stock a cash. T H E E X C H A N G E F O R P E O P L E S T R A T E G Y F E B R U A R Y 2 0 1 4 nd In the area of retirement income accumulation, many companies are opting for performance-earned awards to a defined contribution supplemental executive retirement plan (SERP). There are times in business when outside forces converge to create an unprecedented moment of opportunity. The decisions made during this time are pivotal. They can lead to a great business success—or to lost potential. “There are times in business when outside forces converge to create an unprecedented moment of opportunity. The decisions made during this time are pivotal. They can lead to a great business success — or to lost potential.” These forces can be summed up simply: improved American business conditions have created a much more competitive marketplace for senior executive talent; retention objectives will drive the design of executive compensation in the coming months like at no time since the start of the Great Recession. With shareholders putting increased pressure on compensation committees to tone down total executive pay packages, the timing couldn’t be more significant. The confluence of these two trends challenges the 33
design of all aspects of executive pay, particularly the mix of wealth accumulation tools used in the long-term incentive sphere, creating the perfect opportunity to review how plans fit into current compensation philosophy. Critical Question Now is the time for companies to ask a simple question, “Do we know how to make our LTI compensation plan as strategic, efficient and competitive as possible?” By measuring the efficiency of various elements of LTI in terms of cost to a company versus value to executive, much is revealed. Consider Figure 1. If the executive received a $100,000 option grant/award, the company stock’s value would have to increase 40 percent for the executive to realize the same $40,000 value the company expensed at grant. Were this to occur, the $40,000 in restricted stock would be worth $56,000. 34
KEYWATCHWORDS:THEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 Clearly, stock option plans are not as efficient as they once were due to SFAS 123(R) and its expensing requirement. As a result, many companies are backing away from full reliance on stock options as long-term awards. So what can companies do today to maintain LTI compensation as a strategic, efficient and competitive tool? In my experience, a number of companies have either eliminated and replaced stock options, or moved to 100-percent restricted stock, or to a mixture of options, restricted stock and cash. Company Contribution Awards While the efficiency of restricted stock awards versus stock-option awards is clear, there is another element being introduced into LTI compensation packages—the use of company contribution awards to nonqualified deferred compensation plans (DCPs). DCPs typically are implemented because highly compensated executives are limited in what they can save for retirement through 401(k) plans (2014 maximum pre-tax contribution of $17,500 and a limit on company contributions to $260,000 of considered total compensation). Existing DCPs can be amended to permit discretionary company contributions, generally with investment choices in the hands of the executive and can thus be used to receive LTI awards. Assuming a $1,000 award, if a company decides to go to “100- 35
percent efficiency,” it would issue $1,000 in restricted stock instead of stock options. An alternative approach with the same 100-percent efficiency would be to issue a portion of this LTI award in the form of a company contribution to the DCP, for example 20 percent, or $200. In this case, 20 percent of the LTI would be deferred and invested in a diversified portfolio of investments directed by the executive and the 80 percent balance would be in restricted stock. ow consider Figure 2. While the line of thinking shown here stresses efficiency, some unt N companies may want to include a higher share of ownership for more performance incentive. In that case, a consulting firm may design the LTI plan with a smaller amo in options, a larger amount in restricted stock and a lesser amount in company contributions. 36
KEYWATCHWORDS:THEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 Diversify for Effectiveness ltimately, effectiveness is the key to successful LTI plans because it can lead a reases During the Great Recession, this point was proven and should be engraved in executive rds, ) An Additional Direction Each public company, as part of its “Compensation Discussion and Analysis” proxy , short- When a Committee applies a goal of "competitiveness" to the area of retirement income accumulation (including nonqualified benefits), a growing percentage of companies opt U company to introduce the power of diversification. Quite simply, diversification inc the stability and potentially, long-term effectiveness of the plan. memory: a single company’s stock has far greater volatility than a diversified portfolio. Consequently, when a company introduces diversification into its LTI awa to the extent that the executive has less volatility in his or her portfolio, the overall executive compensation program has greater stability. Thus, the use of company contributions to a DCP with investment choices (just as efficient as restricted stock adds effectiveness through diversification. disclosure, is required to explain its philosophy of executive compensation and executive benefits. Most companies have a well-developed philosophy of salary term and long-term incentive pay. However, few have focused on a philosophy for the benefits side and many are silent. 37
for performance-earned awards to a defined contribution supplemental executive retirement plan (SERP). The board sets performance criteria, which are often similar to the annual incentive plan; that is, high, medium and low achievement produces sc awards. Vesting varies, depending upon objectives (retention, attraction, reward). This move can measurably improve the competitive standing of the overall benefits aled program. In one instance, a company opted for a defined contribution SERP with a d ance- e The increased competition for executive talent is causing companies to rethink executive benefits and retirement philosophy. Companies man combination of 50 percent award toward a goal of a competitive retirement benefit an 50 percent performance based and, therefore, variable. If the performance goals are met on the average during an executive’s career, he or she will end up with a competitive retirement benefit. Higher performance will produce an above-average benefit. In another example, a company moved totally to a 100-percent perform based award, also targeting a competitive retirement benefit if performance goals ar met. These bold actions are not surprising given that corporations are again operating today under the white-hot light of competition for talent. Time for a Change their entire approach to that are not already deep into reviewing their philosophy may want to move quickly.◘◘◘ By Stephen M. Kauf T H E E X C H A N G E F O R P E O P L E S T R A T E G Y F E B R U A R Y 2 0 1 4 38
WELCOME TO PAIDFAIRLY.COM Are you being paid fairly? Search our FREE Online Salary Survey to learn what you should be getting paid. Compensation touches our lives in more ways than we imagine. It determines what house we live in, car we drive, college our kids attend, vacations we take, our ability to retire on time and how we live our lives. Therefore, it is very important to know if you are being paid fairly. Paidfairly interpolates and then extrapolates real employer-reported salary data points based on revenue, industry and location. In turn, helping anyone gauge their current salary or a potential salary offer, and know if they are being paid fairly. OUR ONLINE SERVICES ONLINE JOB DESCRIPTIONS ONLINE GEOGRAPHIC DIFFERENTIAL DATA MARKET PRICE YOUR JOB MARKET PRICING FOR BUSINESSES OUR OTHER NETWORKS ABOUT US CUSTOM ANALYSIS CONTACT US RESEARCH REPORT & SURVEYS Company Research 47
I N T O T H E O B V I O U S BB LL II NN DD II NN GG GG LL II MM PP SS EE SS By Marvin Smith Marvin.email@example.com From the People Side of Innovation & Paradigm Shifts Article #2 submitted by Marvin Smith Identifying and eliminating unnecessary work will make space in your day for Innovation or new projects. To retune and “right size” your workload, it is healthy to begin with an evaluation of what purpose these changes will serve. A little self‐analysis will help: Are you falling behind on important work? Are you feeling overloaded and confused about what to do? vs Do your skills match the effort required to perform the work? What is the level of quality you are you delivering on this work? Is there another person better equipped to accomplish the task? Have you compared your workload to your capacity? Is something more interesting attracting you? 49
Slim down before going in to the next innovation project. First lets examine the current workload, and identify what you can ‘‐lessen, eliminate or continue’. In preparing to accommodate more new and innovative activity, these points might help you decide what to say goodbye to: How can I maximize my previous success and not let it block me from seeing things with fresh eyes? Attention to past efforts must not block what is ahead. Here are a few tips that have helped others: Lessen: Strive to put in less effort to get a larger result. Decide whether the task needs the level of quality/perfection that you are putting in. Some tasks do not require the “apple to be polished to a fine shine”. Eliminate: Ask the question: “Is this really necessary?” In searching for things to eliminate, assume that some portion of the work is not necessary. Ask the question: “What efforts, attitudes, or self‐limiting beliefs can I eliminate?” Why is saying good‐bye to unnecessary reports, work, and effort so hard? Could it be that long‐ standing practices represent a “comfort zone” that makes it is harder to give it up? Knowing why you want to remove certain tasks from your workload will add power and purpose to implementing a right sizing strategy, and will greatly reduce any feelings of guilt. At a large hospital in Chicago, we asked the CEO and his staff to eliminate 10% of their work for one month. Then we asked them to report the jeopardy caused, for them personally, or the receivers of their work. It was amazing to understand how little this 10% elimination disrupted the important things that directly enabled the success of the strategy. BLINDINGGLIMPSESINTOTHEOBVIOUSTHEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 50
During a Personal Mastery Program, I was encouraged to clean my closets of things that I did not need. The theory is that lightness in things/stuff would also foster lightness in weight, body and mind; and allow me to move around with greater ease. This contributed to my agility and helped me ‘move faster without rushing’. This slimming down activity changed my relationship with things that no longer bring value. Low value things that hang around can morph into toxins that block clarity and cause unhealthy habits like confusion, procrastination and self‐doubt. My success at this slimming down only came after losing myself in the practice of doing it. At the Chicago hospital mentioned earlier, we also interviewed the receivers of the ‘end products’ (the senior staff). We asked them to go through this forced work reduction exercise, which included reports, analysis, decisions and delegated tasks; and eliminate 10% of it. Included in the sorting process were questions like: When do you need it? How will you use it? What advantage does this create? What will you lose if you do not receive it? This inquiry refreshed our awareness of the value and results of the work that was occupying time, energy and top talent. Delegate & Entrust: Are you holding onto something because you believe you are the only one who can do it? Is this something that you can do very well and it makes you feel good so you want to hold on to it? 51
BLINDINGGLIMPSESINTOTHEOBVIOUSTHEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 “The Greater the emphasis on perfection the further it recedes” Haridas Chaunhuri from Imagine by Synectics Inc. Ask yourself these questions: Is there a specific reason why I must be the one to do the task? How much harm will someone with less experience cause if the work is beneath my standards, but is still acceptable? Could this be a developmental opportunity for a high potential team member who is willing to learn from the experience? Continue doing: When doing the same thing repeatedly you should periodically “ground”, the activity in its current need and value. In an Overhead Value Analysis Program with Uni‐Lever, we asked the receiver/demander to assign a value to what they received. They justified the need for it by articulating its usefulness and the advantages gained by continuing the effort. We asked how does continuing to do this work support the strategy. We wanted to avoid continuing to do things solely based on momentum. The adage proclaims, “Don’t fix what’s not broken.” But the trick is to ensure that it is really not broken. Long standing procedures require careful examination to ensure their continued value. Justify sameness very carefully. Finishing the Project versus Saying Goodbye: Know when to determine that something is complete, or not worth completing. Ask those who receive your output: “What else needs to be completed?” If the work is to be continued, “What additional purpose or benefit will it serve?” If there is none, then announce that you will no 52
longer do that particular task. Have an official gesture/symbol that solidifies the closure message and makes it official. How to negotiate new work… without making promises that don’t get fulfilled Closure communication done with validation and appreciation makes a lasting impression and gives permission to move on. You have now successfully made room for new work…and innovation. When dealing with new work, many people simply pile it on top of their current work and assume the ‘wagon wheels’ will continue to roll. They focus on the end‐result and not the effectiveness of the ‘fly wheel’. You want to take on new projects, & opportunities, but do not want to get caught making promises that do not get fulfilled. Here is a framework to help negotiate your work efforts and focus your consciousness on where you spend time, so that the new work does not get caught in a vacuum. It might hit you like another ‘blinding glimpse into the obvious’ (something that is elegant and should have been obvious, but is not until it shows up as an insight). As a way to negotiate whether new work will fit into your existing workload: Ask yourself (or a group) what you need to: C O N T I N U E D O I N G S T O P D O I N G S T A R T D O I N G …And Start Doing: Lay the new work out in detail. Describe the work clearly in one sentence, using words that identify the desired action; then: Describe the scope of the work Establish and communicate the action plan Identify the benefits the work and the result provide o To the strategy o To the customer o To Stakeholders 53
BLINDINGGLIMPSESINTOTHEOBVIOUSTHEEXCHANGEFORPEOPLESTRATEGYFEBRUARY2014 Knowing why we are taking on something new, and knowing the potential advantages, will give clarity, purpose and a perspective on priority. If you regularly check your workload ensuring that your efforts are “healthy” you will work better. Cleansing your workload of unhealthy (unnecessary) tasks will help you avoid obstacles that can block you from seeing what is important. Learning to say goodbye to unimportant tasks will help you say hello to new important items. This cycle of saying goodbye and saying hello is an essential skill when negotiating the complexities of 21st century demands. When things change and you protect what you have and play not to lose, rather than adapt, it will be harder to
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