5 Ways Uber, Virgin, Schwab Crush Goals and Disrupt Competitors Alike- Guest Blog

By Mark C. Thompson- Executive Coach, New York Times Bestselling author, contributing author We Got Mojo!, Leadership Advisor to the World Bank, featured in Forbes, INC., and other publications. 

“Everybody loves the idea of ‘disruption’ as long as it happens to other people,” Salesforce founder Marc Benioff mused after a Virgin Disruptors seminar in San Francisco. “You need to get to the future first, ahead of your customers, and be ready to greet them when they arrive.” Sir Richard Branson, the tie-cutting, disruptive founder of the Virgin Group, was sitting within earshot: “Yeah, if your strategy is to change the world,” he said, “you’d better start by looking yourself in the mirror” to ask a simple question:

“Does your current annual plan actually ignite any excitement?” Will your team really want to make it happen with urgency? If you’re not absolutely certain, then rally your troops around five OKR’s — Objectives & Key Results — that make growth plans stick at high-performance companies like Virgin, SalesForce, Kleiner Perkins, BetterWorks, and Google. These five will predict whether your plans are doomed for defeat or poised for progress in the new year: Staffing, Capacity, Alignment, Authority and Accountability.

  1. Staffing Strategy— Do you have the right people on the team, and are you teaching them to lie to you? Alan Mulally, the CEO who lead Boeing and Ford through legendary turnarounds, argues that the belief that “your people should just bring solutions, not problems,” is a myth worth killing. Ford appeared doomed for bankruptcy when Mulally arrived for his first staff meeting, but his team spent two hours sharing dashboards which showed green across the board. “I’m not a car guy,” Mulally sighed, looking mystified. “But I don’t understand how all that good news is possible when we’re losing billions of dollars!” He told them to come back with the brutal truth. It took awhile, but finally one executive summoned the courage to reveal a few red signals, asking for help from the entire team to find solutions. His peers held their breath, expecting the grim reaper to open some trap door under his feet.

Instead, Mulally gave him a standing ovation. That same guy, Mark Fields, not only received the full support of the management team to turn those stoplights into green, but Chairman Bill Ford and the board of Ford Motor Company gladly accepted Mulally’s recommendation to make Fields their next CEO.

You shouldn’t shoot the messenger, but too many bosses do exactly that. Worst yet, the rest of the executive team is allowed to pile on when you finally do admit you’re in trouble. When people are afraid, they hide reality until it implodes. Tremendous effort is poured into managing a secret rather than finding a solution. Rather than obsess over disrupting competitors, perhaps it’s time you ‘disrupted’ the fear of failure for ‘disruptive’ ideas at your company, says Whitney Johnson, author of Disrupt Yourself. Make sure your management systems celebrate (rather than punish) those who clarify problems and challenge business as usual. Don’t wait for the C-Suite to do this for you—start by role modeling that behavior as a leader of your team at every level in the organization. It’s disastrous to make plans and set goals without a staffing strategy that makes it safe to work as a team through difficult times. As you hire new people, be on the lookout for recruiting a deeper bench of experienced talent who love to learn rather than hold court—auto-didactic executives who have the confidence and hunger to lead and improve at the same time.

  1. Strategic Capacity—The battle is lost or won before the players get on the field. What strategy, resources and skills are necessary for your teams to lead the business transformation that you’ve outlined in your annual plan? In other words, you’ve set the table and bought the ingredients, but do they know how to cook? Leaders often engage in “wishful thinking that people can easily take the leap of faith” to execute your plan without actively “preparing them to win,” Bill Gates told me when I first met him at the World Economic Forum in Davos. We were serving on a panel focused on strategic planning, and he gave us a stern reminder that the “people expected to do the work are rarely in the room” where those great plans were conceived, mandated and “passed down like tablets from above.” If there’s any major changes in process involved in this new plan, how will you reward your staff at every level to embrace change, or have they just been asked to tolerate the changes you’ve made rather than own them? “You can’t ‘manage’ change if your team doesn’t understand how you’re supporting them” through the transformation. It may be obvious to you, but not to them. You’ve got to show them, Gates said, “don’t just think they heard you because you told them.”
  2. Alignment—Do we have a process to reward and recognize people for working together across silos to make things happen for customers? Do we have the measures in place to make that obvious? You can’t manage what you don’t measure, but we often don’t realize that leaders have contradictory rules in place that make it difficult or invisible when our team goes out of their way to collaborate, says Harvard’s Dr. Carol Kauffman, founder and executive director of the Institute of Coaching. We team taught an advanced coaching workshop during her annual summit with McLean Hospital, a Harvard Medical School affiliate, where we heard overwhelming evidence from behavioralists like Dr. Susan David about how “alignment on a shared vision and ownership across teams” are the two lynchpins to high performance. What that requires is a behavior David calls Emotional Agility. She suggest that next time you find your team falling out of alignment “in a moment of stress or dealing with real complexity, ask yourself: I might be ‘right’ but is my response serving me? My team? My organization? What is my objective here? What am I truly trying to do? What action here is most aligned with my values?” Think about what team behaviors you want repeated: create a structure for that and shine a light in public about those values. Celebrate those teams and individuals who demonstrate them.
  3. Authority: “It’s obviously better to manage white water than to suffer log jams,” Travis Kalanick mused during my first visit to Uber. The disruptive founder of a company that’s synonymous with disruption loves white water, because to him that means “you’re paddling hard” through difficult currents, but at least you’re “splashing downstream with urgency.” But logjams around decision making are more typical; they signal that your plans are stuck because everyone is tolerating lack of clarity around authority. It’s much easier to give people responsibility and think that we’re holding them appropriately accountable than to figure out what level of authority they should have to deliver the outcomes you’re seeking. The point here is to agree explicitly about who can make which decisions. What makes this especially difficult is that you must be willing to tolerate and support other people making choices to move ahead even when you know they are not likely to be the same choices or maybe even the ‘best’ steps you’d take. There is often a mismatch between the responsibility that’s assigned and the authority necessary to move projects forward. Be realistic about workflow so that you intentionally accelerate progress.
  4. Accountability— What makes the planning process miserable are those endless days in the weeds fighting over the wrong issues or enemies, and in the end, it’s still not clear who’s responsible for what outcomes. Admit it, you’ve probably dreaded planning, and studies show that frustration springs from too many unspoken expectations by you and your boss, along with a general lack of pre-agreed definitions of success. LinkedIn leadership development expert Prakash Venkataraman believes the core to accountability revolves around clear ownership “focusing on what you can control to create the best possible outcome.” Ownership and accountability determine the “willingness to be held responsible for an outcome” even though we can’t control perfection.

I hated the planning cycle until I was lucky to work directly for a dozen years alongside founder Charles ‘Chuck’ Schwab,  the financial services industry disruptor. He insisted that no great plans or projects proceed without four checkpoints:

  1. Identify owners for what creates growth and quality of our services.
  2. Create clarity about how every new hire will have impact on your top priorities.
  3. Establish rewards and consequences for the individual, team and organization that make it self-evident how you’re doing. It’s not the boss’ role to hold you accountable—that’s your job—your leaders are there to bust barriers and help you win.
  4. Nail the right measures to keep things on track. Whenever the planning process started to drift at Schwab, he tasked the leadership team with shifting our external focus from obsessing over competitors, for example, (a natural tendency), when we should instead be fussing over our customers. When the internal conversations devolved into conflicts over power, control or defending turf, Schwab tasked us to remind the team who pays the bills. “Our job is to create breakout customer experiences — every year it’s about making things better and simpler in measurable ways,” Schwab said. At this point, Chuck would slap the table and smile as we lurched in our seats. Then he’d point to the plans that we had all signed up for. “I’m proud that you’re all willing to be accountable for that. You own what matters most!”

            The most common confusion about accountability is the difference between blame and responsibility. In studies about people who achieved extraordinary success long term despite seemingly impossible circumstances, “the most important factor was not whose ‘fault’ caused the horrible situation,” said serial entrepreneur and Cuban refugee, Dr. Raul Deju, founder of the Institute of Entrepreneurial Leadership at John F. Kennedy University, where over $2 billion in revenue has been generated by dozens of scrappy startups born there. “What matters is that you take responsibility for what you can own — that might be your willingness to serve others, to learn new skills, or the attitude you show up with and an ambition to take action.”

            Deju and 35 other entrepreneurs have captured case histories of remarkable “ownership of adversity and personal transformation” in a recently released book, We Got Mojo (available at Amazon, Barnes & Noble and other resellers; check it out at http://www.wegotmojodeju.com. These are personal stories about business leaders who you would never have expected to spring out of the genocide of Cambodian killing fields, the Cuban Revolution, or brutal life in the rural mountain villages of Perú. “Nothing could stop any of us in our aim to lead a wildly successful life until we abandoned the right we had to be victims.” Deju said. “Sulking and blame never fixes anything — it’s all about Mojo, the powerful realization and joy of knowing that it’s a choice to decide how to hold yourself accountable every day.”

To create greater transparency and accountability around goals, serial entrepreneur Kris Duggan, founder of Badgeville, along with legendary venture capitalist John Doerr, the first chairman of Kleiner Perkins, joined forces to created a startup called BetterWorks. “OKR’s should be at the top of every CEO’s 2017 wishlist,” Duggan insists. “When you have tools in place to measure goals with complete company-wide transparency, you get both operational excellence and more engaged, motivated employees if you’re willing to make a few changes to your performance management process.” Duggan and Doerr recommend a fresh start in 2017 by “replacing heavyweight, annual performance reviews with lightweight, frequent feedback.”

After three decades coaching extraordinary entrepreneurs, I’ve seen far too many CEO’s struggle with a leadership team whose annual plans drift dangerously without accountability. To help bring more structure to that process, last year Don Sull of MIT and I decided to become strategic advisors at BetterWorks because the key to execution on the annual plan is obvious: “Sally on your team shouldn’t be editing her Instagram photos at work — nor should she ever doubt her role as an individual contributor connecting to the company’s success,” Duggan said. “Setting transparent OKRs and communicating them to the entire company helps keep employees, like Sally, focused on what really matters.”

Duggan and Doerr’s upcoming book, Measure What Matters, is packed with evidence on over 200,000 goals achieved with transparency at more than 25% of the Fortune 500. On April 20, I’ll be hosting dozens of conversations about OKR’s with these and other thought leaders at the 2017 BetterWorks GoalSummit at the Palace of Fine Arts in San Francisco.

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