Posts Taged change-management

People Development – Stewarding People

A primary factor in most business’ success is the people who work for the business. Caring for the people who work for your business by investing in their education, training, compensation, motivation and empowerment creates a culture and environment where people will want to give their best work for the company.

The idea of people development has gone through many changes and descriptions over the past one hundred years. I believe words matter and when people are called assets and capital it conveys a sense of ownership by the company over its employees. In my mind these terms are completely opposite of what stewardship and people development represent. People should not be considered an asset to be used, given occasional repair and maintenance, depreciated and eventually replaced.

The concept of managing people and being aware of training and compensation strategies is not new in the business world. The idea of managing personnel emerged as a clearly defined field by the 1920s. It began largely as addressing the technical aspects of hiring, evaluating, training, and compensating employees. Personnel management did not typically focus on the relationship of employment practices on overall organizational performance.
Economist Theodore Schultz invented the term “human capital” in the 1960s to reflect the value of human capacities. He believed human capital was like any other type of capital; it could be invested in through education, training and enhanced benefits that lead to an improvement in the quality and level of production. The term Human Capital is a measure of the economic value of an employee’s skill set. The concept of human capital recognizes that not all labor is equal and that the quality of employees can be improved by investing in them; the education, experience and abilities of employees have economic value for employers and for the economy as a whole.

In recent years companies have been emphasizing that the most important asset at their company isn’t something they can put their hands on. It isn’t equipment or the physical plant, and it isn’t data, technology, or intellectual property. The most valuable part of their company is the people. They use the term human capital to describe this asset and believe any plans to move their business forward has to start there.

Human Resource Management began to develop in the late 1970s in response to the increase in competitive pressures in American business as a result of such factors as globalization, deregulation, and rapid technological change. These pressures prompted businesses to begin to engage in strategic planning. This was a process of anticipating future changes in the conditions of the working environment and aligning the various components of the organization in such a way as to promote organizational effectiveness. William R. Tracey, in The Human Resources Glossary, defines Human Resources as: “The people that staff and operate an organization,” as contrasted with the financial and material resources of an organization. A Human Resource is a single person or employee within your organization.

Today companies are starting to see that an effective people development strategy is an important key for business success. This strategy needs to be able to react to changing business conditions. However, people development is not an easy strategy to implement. Many firms think they are training their people. Unfortunately many of their people do not think they get enough training.

People development strategy is about growing and developing the business. If the business does not grow and change, then there will be no business. Development of business processes needs to be in step with developing our people. The goal is to develop people at the same time as the business changes or adapts.

If the business changes but people don’t, the people in the business can feel threatened or stresses. When businesses develop their people but the jobs and roles do not change, then often people get frustrated and leave. Or they forget the training they have been given! The idea is to develop people just ahead of when they need new skills or knowledge. Train too early and people forget. Train too late and mistakes or safety implications occur whilst people learn. An effective People Development Strategy will ensure that the changes a business needs to grow and be successful are linked to appropriate people development.

You may have heard the quote by Zig Ziglar “What’s worse than training your workers and losing them? Not training them and keeping them.” I would suggest that being a good steward of people is to train them regardless of whether you think they may move to a different job. People move to new jobs for many reasons, but the majority of them don’t leave because you have invested in developing them as better workers and people. Besides, people development makes for a better community as a whole and therefore will be better for your business.

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CFO Book Review – The 8th Habit by Stephen Covey

The 8th habit was written as a response to the profound changes that we are experiencing in world since the author wrote The 7 Habits of Highly Effective People. Dr. Covey believes that finding our voice in life will help alleviate much of the pain and frustration that so many people are experiencing in their jobs and relationships in this new Knowledge Worker Age. He believes that by following the advice and path that he lays out in his book the reader will be able to discover and give voice to their deepest passions and talents. By discovering and harnessing our passions and applying it to the great needs of the world we will find the true calling in our lives. This will provide us with a great sense of satisfaction and will help inspire others to discover their passions and calling in life.

Dr. Covey goes on to describe the significant changes that are occurring in our society. We are entering into an age that more and more people are being given the ability to make a variety of choices in their lives. However, we are poorly prepared to make these choices in self-management. This is causing much pain and frustration in the work world, in our communities and in our relationships. We have organizations that respond by controlling people and we have people not knowing how to change the system so as not to be controlled. The author then proceeds to outline a path where one can begin to make the changes necessary to change their own environment. By successfully changing one’s own environment you will inspire others to follow. This will eventually create the paradigm shift that will allow the majority of people to find their voice in society and live a fulfilled productive life.

What Dr. Covey presents in this book is really nothing new. I believe human kind has always desired to find his/her voice in this world. Man was created for a purpose, and only finds true fulfillment and satisfaction when that purpose is discovered and lived out. Perhaps because of the tremendous amount of information and knowledge at our fingertips we as a society are more aware of the possibilities and have a better venue to voice the frustrations of life, but as the author of Ecclesiastes tells us in chapter one verse 9 “History merely repeats itself. It has all been done before. Nothing under the sun is truly new.” This book does provide some good insights into the work world and how we have a tendency to deal with problems in our work place as well as in our relationships. Unfortunately, much of what Dr. Covey encourages people to do, will take a tremendous amount of discipline and courage. Most people that are frustrated and discouraged in the workplace won’t make the effort to follow his advice.

The one theme that resonated with me was the concept that one person can make a difference. By being courageous and steadfast in pursuing what’s right in a particular work environment, walking in grace and compassion for people and leaders, changes can happen and others can be inspired to follow in your footsteps.

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Blue Ocean Strategy Book Review

Blue Ocean Strategy was written with the aim of challenging companies to create uncontested market space by executing a strategy that is both systematic and actionable. It is the author’s contention that many companies could break out of their current competitive, often-times shrinking market, and create new markets that render the competition irrelevant. The cornerstone of the blue ocean strategy is what the authors call value innovation. The conventional wisdom in business is that if a business person increases value to his/her customers through innovation, then that person is also going to be increasing his/her cost. Likewise if a business person uses a strategy that decreases cost he/she is going to have to lessen the value he/she can provide to his/her customer. The blue ocean strategy suggests that a company can pursue both innovation and low cost simultaneously. Value innovation occurs only when companies align innovation with utility, price and cost positions.

The author suggests that if a company understands the principles and strategies behind creating blue ocean markets, it will be able to maximize the opportunities while simultaneously minimizing the risks in the execution of a blue ocean strategy. The strategies fit within what the author calls the four actions framework. A company must identify factors that have under served or compromised value to customers. A company must identify factors that could be created that the industry has never offered. A company must eliminate factors in its industry that are taken for granted even though they no longer add value to the customer. Finally, the company must identify factors that provide products or services to its customers with little or no benefit but increases costs.

One of the key principles of blue ocean strategy is to successfully identify commercial opportunities that will reconstruct market boundaries and break away from the competition. The author has identified six basic approaches to remake the market boundaries. First a company must look across alternate industries that fulfill the same basic purpose as their own industries but is in a different form. Second a company must look across strategic groups within their own industry. Third, a company must look across the chain of buyers, looking at the purchaser, the user and the influencer. Fourth, the company must look across complimentary product and service offerings. Fifth, the company must look at the functional or emotional appeal to the buyer. If a company’s product is traditionally functional then how can it appeal to the emotional buyer, and if the company’s product is primarily sold because of its emotional appeal, how can the company market to the functional buyer. Finally the company must look across time. It must look at trends with the right perspective to take advantage of blue ocean markets.

The challenge with following these principles and strategies is how to influence the majority of people within an organization to want to think outside the box. Many times a company may have an innovative marketer or manager who comes up with a great idea, but lacks the support and structure to implement the idea. With the faced pace environment that we work in, there seldom seems to be time to think deeply and innovatively about blue ocean strategies. The author admits that companies have a tough time translating thought into action, particularly when the blue ocean strategy is a significant departure from the status quo. The author identifies four major hurdles to overcome in order to execute a blue ocean strategy. First, the employees must be made aware that there is a need for a strategic shift. Second, there seldom is an abundance of resources to tap into to execute a new strategy. Third, is the ability to motivate key employees to work hard and fast to accomplish a strategy that may seem unorthodox. Finally, with most companies the political environment is such that most people do not want to change for fear of losing their own power or position.

The bottom line for a company to have a chance at succeeding in the execution of a blue ocean strategy is that trust must be built deep into the ranks of employees. They must feel that the execution strategy is fair. Key employees must be engaged in the process. There needs to be a clear explanation as to why things will be done a certain way. Finally, an expectation of playing by a new set of rules must be instilled.

https://www.blueoceanstrategy.com/

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Servant Leadership

This is a CFO Business Partner review of the book Servant Leadership: A Journey into the Nature of Legitimate Power & Greatness by Robert K. Greenleaf

This book was written out of a concern for students that seemingly had no hope of change in the institutional leadership. Secondly, the author had a desire to influence both leaders and followers to serve willingly with skill, understanding and spirit. This was brought out by an overarching concern for the total process of education of leaders. Mr. Greenleaf was observing an indifference to what makes up a leader beyond the mere intellectual preparation.

The author goes on to define a servant leader as one who has a natural desire to serve first. With this desire to serve as foremost the leader then takes the initiative to move forward with the ideas and structure down a path for the good of those he is leading and the organization he is a part of. The servant leader is a good listener and has a desire to understand the issues and concerns of his followers. He accepts the individual and empathizes with his position, even though the performance itself may be subject to correction. The servant leader operates with foresight, awareness and perception in leading an organization forward.

While most of the discussion on leadership and servant leadership centers on individuals, Mr. Greenleaf contends that institutions often are the medium that servant hood is carried out. “If a better society is to be built, one that is more just and more loving, one that provides greater creative opportunity for its people, then the most open course is to raise both the capacity to serve and the very performance as servant of existing major institutions by new regenerative forces operating within them.” (62) His focus is on three primary types of institutions: churches, universities, and businesses. His main focus is on the structure of leadership. He proposes that both the trustees as well as top leadership in organizations should be structured as a team of peers. They would be led by a primary leader, but this leader would have no more authority then anyone else on the team. He also believes that the Trustees of an organization must take a much more active role in servant leading.

As with any theory or philosophy, challenges always arise when theory meets practice. In an ideal world everyone would be eager to serve one another. Those leading would always have the best interests of others in mind and those being led would willingly submit to any servant leader that steps forward. Institutions would rise with the ethos of servant hood and Trustees would spend time serving in their capacity because they love the organization and the people they serve. The reality is we live in a world that is often rife with greed, jealousy and self-centeredness. Many leaders are corrupted at least partially by power, and will often times have a self-advancing agenda as a motive to lead as a servant. Yet, I believe that many of the principles put forward are valid and should be the expectation we have of our business leaders.

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Your Business Should be a Force for Good

This is an open letter written by the founders of B Lab to business leaders, Andrew Kassoy, Bart Houlahan, and Jay Coen Gilbert.

B Lab has spent the past ten years serving a community of credible leaders who are using business as a force for good. We want to live into the values expressed in the Universal Declaration of Human Rights and our B Corp values, which state:

That we must be the change we seek in the world,

That all business ought to be conducted as if people and place mattered,

That, through their products, practices, and profits, businesses should aspire to do no harm and benefit all,

To do so requires that we act with the understanding that we are each dependent upon another and thus responsible for each other and future generations.

Those values make the path forward clear to us. In the current environment of rising insecurity, fear, hate speech, and violence, and in the absence of trust in our economic system, all business leaders have an unprecedented responsibility and opportunity to build a more inclusive society.

We speak now not to one political party, or one niche group — our community of business leaders, our workers, our customers, and our investors span the political spectrum. This is a universal call to live into our values and to build a global movement of people using business as a force for good.
At this moment we call on all business leaders to do two things. First, in this chaotic moment, to stand up and to speak out, together and unequivocally, when we see injustice, hate, and the violence they produce. Second, to take concrete action in our own businesses to create an inclusive economy that is equitable and creates opportunity for all for the long term.

Stand for justice

When we speak with collective voice, business leaders have the power to stand in the way of injustice, to honor the inherent dignity of all people, and to make it possible for us to reach our full potential as human beings, as organizations, and as a global community. Our responsibility to stand for universal human rights and civil liberties is not simply a business imperative, but a moral imperative.

B Lab rejects discrimination, no matter where it comes from or who is targeted. All businesses, which benefit from our diverse society, have an obligation to do the same. We must stand with those civil society and social justice organizations fighting on the front lines to protect the most vulnerable. This means working against any forces that would divide and disenfranchise people based on their identity or circumstances at birth.

We do not want to sell this commitment short. This will be hard. It will require businesses to look beyond what regulation
demands. It may require business leaders to speak out against unjust laws, or to resist them in order to protect vulnerable workers or communities. It may require much more. It will always be worth it.

Take action to build an inclusive economy

As business leaders, we must also look to where we are most powerful. It will not be enough to call for justice in this particular moment; we must also create justice through our organizations.
Your business is an employer, a place where people spend their day and a source of salary and benefits for families. Your business has purchasing power that can support communities and causes you care about. Your business’s activities and products affect the global environment — and rely on it. And as a business leader, you have an influential voice in your community and with your elected officials.
Our businesses are powerful tools that we can use to create a more inclusive economy, and ultimately a more inclusive society. Doing that effectively will require listening to all those who are systemically disaffected and disenfranchised — whether through racism, misogyny, xenophobia, classism, ableism, homo- and transphobia, or other institutional and historic forms of oppression. People who have been marginalized and exploited by our current economic system exist across the political spectrum in rural and urban communities around the world. In order to restore trust in business, the business community needs to respond to those people’s legitimate desire for jobs with dignity. The business community also needs to make the case that economic justice for all is inextricably tied to, and dependent on, social and environmental justice.

It is clear that government alone cannot or will not solve the problems facing us right now. In their absence, business must play a leadership role in forging a path forward. Thankfully, there are businesses around the world that have been proving that profit can come with the pursuit of a higher purpose — that we can build an inclusive economy that works for all.
What does an inclusive economy look like in action? In Grand Rapids, Michigan, a plastics manufacturer called Cascade Engineering welcomes formerly-incarcerated returning citizens and offers on-site benefits that have helped hundreds of employees transition off of social support. In New York City, a worker-owned cooperative of home health care workers in the Bronx called CHCA provides exceptional care for patients while creating secure jobs and ownership for women of color. In the heart of Pennsylvania Amish country, The Stroopie Co employs recently-settled refugees and offers ESL classes to help them move into leadership roles. In Chicago, Method Products PBC is bringing high-quality manufacturing jobs back to the Midwest, including the South Side of Chicago.

An inclusive economy looks like a living wage for all workers. An inclusive economy looks like a boardroom and management team with the same demographics as the company’s factory floor. An inclusive economy looks like a world in which business creates opportunity for those who have been marginalized, instead of maintaining the status quo while lamenting the constraints of market forces. These ideas don’t require government regulation; they can be realized through the leadership and stewardship of the business community — if we choose to take action.
We are inspired by the leadership of 2,000 Certified B Corporations. They’ve proven that you can do well and do good, and they offer a path forward. But they can’t build an inclusive economy alone. We need everyone. We need you.

One way to begin is for every company to take concrete, measurable steps to build a more inclusive business. Every change your company makes has a real impact on real people.
Think about what matters to you. How can your company contribute? If you need a starting place, consider picking two or three of the practices and policies we have identified in our Inclusive Economy Metric Set. Make a public commitment to improving on those two or three. Hold yourself accountable, even (especially) when you fall short. Listen to your employees and your customers. Let us know what you are doing and what you learn along the way so that others can follow your lead.

Your business has the power to make the change you want to see in the world. If businesses like yours take action to build a more inclusive economy, we will improve the lives of millions of people that are touched by our businesses as workers, suppliers, customers, and local communities. We will rebuild an economic system worthy of people’s trust. We will create a more shared and durable prosperity for all. We will change our society — for good.

For more information about B Lab please go to https://www.bcorporation.net/what-are-b-corps/about-b-lab

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CFO Book Review: Leading Change

Leading Change
by John P. Kotter
Harvard Business School Press (1996)

Leading Change was written as a follow up to an article the author wrote for the Harvard Business Review entitled “Leading Change: Why Transformation Efforts Fail”. This article received such an overwhelmingly positive response that John Kotter wanted to provide greater detail and more examples of how companies have been successful in leading change.

Many business managers read about the common mistakes listed by the author for the reason companies fail in implementing change and realized they were mistakes they have seen and experienced. Ultimately, the book has resonated with many in the business world because of the way the author has provided a framework for breaking down a transformative change process into identifiable pieces that are realistic to follow.

The author first outlines eight common errors that leaders in organizations follow into when they try to implement change within their companies. The consequences of falling into these errors are that new strategies aren’t implemented and many of the hopes and plans for creating synergy and energy in a company fall flat. The author doesn’t spend much time talking about the errors that are made. It is likely that most readers can identify quite quickly with the errors and are looking instead for solutions. So the author takes the majority of the book to outline eight stages that he has identified as critical to success in implementing transformational change in an organization.

1. The first stage is to establish a sense of urgency. In many cases a crisis of some sort is happening that creates the urgency to implement change.

2. The second stage is to create a guiding coalition. Here the idea is that in order for change to happen, there needs to be more than just the CEO or one person to suggest and lead the change process.

3. The third process is to develop a vision and strategy. If people are unable to see how this change will create a better future there will be too much resistance.

4. The fourth stage is communicating the change. This needs to be a simple and clear message that is repeated often. The area of communication is such an important piece of leading change and yet it often times is the weakest link. The message is either too complicated or not repeated often enough.

5. The fifth process is to empower broad-based action by employees to remove obstacles to change. This may include taking risks and trying nontraditional ways of doing things. Here employees need to be willing to move out of their comfort zone and not do things just because that’s the way it has always been done.
6. The sixth process is generating short term wins. People can become tired and overwhelmed with change and lose their focus in accomplish long-term goals.

7. The seventh process is consolidating gains and producing more change. This is similar to generating short-term wins, but it goes beyond this by taking these wins and building on them to implement change in an even better more productive way. The final process is to anchor the new approaches into the existing corporate culture. This is a key process to achieve lasting change. If employees don’t see that the changes implemented match up with the current values and culture the new processes will slowly disappear and eventually the organization will do things the way it always has.

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