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Why do companies persist with Theory X policy-making?

I’ve had a mixed bag of conversations this week, alternating between organisations I would classify as progressive, by which I mean they have the philosophical chops to be able to move forward, and those that are so steeply mired in a Theory X-based bully culture that they can’t even see why they’re limiting their own way ahead.

I feel so naive at times; I am literally baffled why a group of people would be able to operate for more than a day under the emotional and intellectual strain that some companies slather themselves with so lavishly.

It has been 55 years since professor Douglas McGregor of the MIT Sloan School of Management wrote The Human Side of Enterprise in which he described his Theory X (in which people need to be controlled if they’re to achieve anything at all) and Theory Y (in which people are ambitious and self-motivated and thrive well under a high degree of freedom) hypotheses.

That’s one hell of a long time. Long enough for the ideas to have spread. This was after all, a best-selling book.

But ideas have to fire up a receptive mind if they’re to grow into anything and as I keep discovering, there aren’t enough of those out there.

A large part of the work that we do at Happy Sandpit, my organisational culture consultancy, is helping companies to formulate a set of deep-seated Core Values that fully describe them. Not the total bloody nonsense most companies have on their walls, but Values that are inherent and important and worth defending with blood if necessary.

The process of getting to them is one of uncovering the true philosophical mindset that guides that particular organisation and the quickest way to get to that, because it’s clear that most organisations have no idea how misaligned their words and actions actually are, is to examine the company through the artefact of its policies.

Most company policies are just so much protectionist bullshit they shouldn’t exist at all. They were written into law for that particular company not because they felt they were under siege and needed to protect themselves against threatening behaviour, but because some Theory X-fuelled jerk was given the right to start making amendments.

Enforced laws become habits and over time, Theory X companies watch with perplexity as innovators, free-thinkers, and really talented personnel fail to stick around more than a few months without a ridiculous package of salary and perks to keep them chained down.

But to me the reason is simple. I’ve always been a Theory Y thinker. People are good and want to do good things. Where management of individual transgressors can resolve a problem, there’s no need to create a policy to restrict the movement of the entire group.

It’s a more challenging response, because it means you actually have to do some work in understanding how the individuals that comprise your organisation can play out their best role. And I believe it is as clear as daylight that organisations that do this, are the magnets for real talent.

Is your organisation Theory X or Theory Y? Are you sure? Read the policy book. You could be in for a shock.

The truth behind seminar operators and their confusing degrees of quality

When you sit through a seminar these days, they often contain an upsell to a programme of sorts. Some of them are good and well worth buying into. Some of them, not so much. You can usually tell the difference between them by the way in which they’re sold, however.

For instance, it’s common for the operator of a dodgy scheme to offer you a range of options, calling them Silver, Gold, Platinum and Platinum Plus or variations of those categories. The Silver one is always cheap and nasty and you can ignore that. The Gold one seems okay, but you’re now nervous that you’re not getting what you really want. So you consider the Platinum one, or even the Platinum Plus, and you end up spending more money than you should. You may have seen this sort of thing before and been confused by it, precisely because it is indeed confusing.

In fact, Platinum Plus is all you should ever, ever want, but you should be paying the Silver price for it. Think of it like this: if Steers were to sell burgers the way these guys sell programmes, your options would be the following:

Table for Blog Post

Now, I don’t know about you, but I have to wonder why anyone would want any of the other options when Platinum Plus is the absolute minimum standard I would accept. And should you be paying R200 for the absolute minimum standard? Not on your life.

You’ll see how operators of credible training programmes tend to be a lot less obscure and get to the point. If they’re not, you’re probably being confused for a reason.

Integrity is massively overrated

You may never have heard of Jack MacLean, but during the 1970s and 1980s, through his relentless pursuit of excellence, he became incredibly wealthy. One could say he was in the jewellery business. Perhaps you’d call him an entrepreneur with a very niche set of skills. He didn’t seek praise or celebrity, nor even recognition. In fact he avoided it. He was happy to know that what he was doing was always done to an exceptionally high standard and that his end result was consistent.

Jack MacLean wasn’t a man of integrity in everything he did. He routinely carried a change of clothes in case he was spotted near his work and needed to create a disguise. He carried a police scanner so he could eavesdrop on nearby police cars to make sure he wouldn’t be interrupted while he worked on one of his projects. He needed these, because he was a cat burglar who stole over $133-million in jewels from Florida apartments in a 20-year career.

He never damaged property, using lock picks instead of forced entry. He never resorted to violence. His methods were so meticulous that it often appeared that items that were stolen had simply been misplaced since there was no reason to assume a theft had taken place. In his work, integrity of purpose was a non-negotiable.

55% of all Fortune 500 Companies list ‘Integrity’ as one of their Core Values. In its day, so did Enron. All it really says is that those companies have something in common with a jewel thief, which of course is not at all the point they’re trying to make.

Values such as Integrity are what we at Happy Sandpit call entry-level Values. They’re philosophies that shouldn’t need to be expressed, because without at least a modicum of integrity, you don’t have a business of any worth. In other words, they should be a given. There is absolutely no way you’re ever going to convince me that’s the deepest thing you can reveal about the personality of your business. It doesn’t tell me anything that enables me to differentiate you from anyone else.

And it doesn’t give your employees anything like enough guidance.

Core Values are not things that can be so glibly expressed, and the appearance of words such as integrity is all the evidence that is needed that you haven’t applied the correct measure of thought to what it is that you cherish most dearly. In a personal sense, Values are not chosen, they evolve very individually so that even siblings may have a very different set of inherent philosophies. In an organisational sense, Values are best stitched into the fabric when a limited subset of leaders and super-committed employees agree on what will cause them to lose sleep at night or to throw up their hands in glee.

Having Integrity isn’t one of those things.

5 reasons that elections offer a (fragile) leadership masterclass

Today, David Cameron, Prime Minister of the United Kingdom, asked the Queen to dissolve parliament, in preparation for a general election on May 7. Next year, on November 8, Americans will go to the polls to vote in the successor to President Barack Obama. In Nigeria, the elections are underway. Last year in South Africa, we had our own. Elections are a regular fixture on any democratic calendar and they are often painful. But in them, there are lessons for any leader who wishes to understand what really drives engagement, and what turns it away.

If today’s business leaders get one thing consistently wrong, it’s failing to create followers. Since by definition, you cannot lead without someone following you, that makes them hardly leaders at all. It’s the one thing that needs most urgently to be remedied.

Here are five lessons that any leader ought to note:

1. I want to be led by someone likeable.

Politicians, or at least their strategists, understand that in order for people to get behind you, you need to give them points of connection. Call it low-information politicking if you must be disparaging, but there is a very clear reason why the President of the United States gets handed a baseball mitt for a quick game of catch in front of the press photographers, when Air Force One touches down on the tarmac.

There’s a reason why the Prime Minister of the United Kingdom pops into a local pub for a pint when he’s out gathering votes, again for the benefit of the photographers.

Without these moments, those leaders are hard to separate from their wealthy families, top educations and privileged backgrounds, which offer only an embarrassing comparison to that of their would-be electorate. You can take those things out of the headlines however when you share imagery of baseball or beer drinking, and you have something that looks to voters who aren’t doing anything like enough analysis, like something they have in common.

It’s hard to accept for anyone who really cares about the issues, but that sort of thing is critical to the election of most major western politicians. When people think a candidate is one of them, or at least that they share enough common interests to really ‘get’ each other, they’re more at ease giving those candidates their votes.

But let’s be clear about something. Obama really does like baseball. Cameron really does like beer. The importance of those photograph is not to create an unreal perception, but to highlight a humanness that can otherwise be lost in the mist of politicking. They don’t get the opportunity to be mere people very often, so they don’t waste it when they get it.

Being likeable is job number one, and as I write this, there are 20 South African CEOs right off the top of my head, who somehow have utterly failed to grasp that obvious fact.

2. I want to be led by someone who looks and sounds like a winner

No electoral candidate will get anywhere near centre stage if they don’t have the gravitas to seem attractive. It’s not specifically about good looks, but it is about polish and the obvious aura of confidence. That’s a demanding mixture because in most cases, elections are fought on promises about the future, which requires real belief.

People who are committed to a course of action that seems mountainous in its scope, are compelling. Especially when that course of action appears clearly aligned with a greater good.

Speak about the future with conviction, and have solid ideas for how you intend to pull it off, and you tick the confidence box.

Many leaders, and a good number that I know personally, spend their time fidgeting with the small stuff, creating the impression both that they simply lack the vision to pick a point in the future and aim for it, and the confidence to truly put their skills to the test.

3. I want to be led by someone who seems honest

Let’s accept that real honesty is a rare commodity and that a certain amount of ego and self-interest is always going to drive any leadership agenda; nevertheless, there are people who are out on the leading edge, challenging things that are clearly troubling, and those who are obviously pushing an agenda that only serves them and theirs.

Leaders who speak from the heart and add in a dose of measurable sacrifice of their own, score highly with voters for good reason. Those who demonstrate their ability and willingness to do the things that they are asking of others, similarly earn respect.

There is a natural order of things when it comes to effective leadership. Leaders must understand that their role is to gather willing support through deed and action for the things they aim to achieve, which depends on people being able to believe them. You don’t create belief by being contradictory; by saying one thing, but obviously doing another.

4. I want to be led by someone who knows it’s not all about them

Elected public servants in advanced democracies, tend to be frequently reminded by their electorates that their job is to serve. In less advanced democracies, they often make the error of believing they have the right to lord it over a nation full of servants.

That latter mode of thought, is too often the case in corporate structures where leaders don’t run any real risk of being removed by their people.

When democracy works best, a leader is elected with a mandate to achieve the things the electorate has green lighted, because they have at least tacitly approved that leader’s manifesto, by voting for them. Not all leaders get that, and in many cases, it is the elected official’s highly-influenced agenda which has overriding importance.

Corporate leaders must understand that though their position is not subject to the whimsy of elections, their ability to achieve great things is absolutely tied to the will of their people to offer more than the bare minimum. Achieving that has more to do with serving an open agenda than many would care to admit.

5. I want to be led by someone who aims to create magic, not personal comfort

The truest measure of a leader is the quality of the people he or she surrounds themselves with. A great team of people can achieve great things; cronies and friends almost never will.

When leaders are appointed within an organisation, just as when political portfolios are given out following an election, you get the clearest view of all, of just what the next year or two will hold.

I want the credentials of those who are being appointed to speak for themselves. I realise I won’t get the opportunity to vet them personally, but I don’t want to be left feeling that someone has been appointed because they are close enough to the leader’s agenda that they’ll provide comfort and cover. I want those people to be so undeniably right for the position to which they are being appointed, that I can confidently predict oncoming magic.

The bottom line

As a leader, I consider elections to be like master classes of both what to do, and what not to. Usually, the people who win have charisma, believability and a brave agenda. How many CEOs can we say that about, right now? If you want real insight into how it should (and shouldn’t) be done, the lessons that are coming your way are free. Don’t waste them.

Why it’s not only okay for the BBC to sack Clarkson, it’s necessary.

It’s astonishing how many people have come down on the side of Top Gear presenter Jeremy Clarkson in the past few weeks, as if he’s an embattled hero being persecuted by his wicked employer. Fans will be fans I suppose, and one thing Clarkson has done is to polarise a very large number of people into communities of those who love him and those who love to hate him.

He wouldn’t much care about that. He’s taken a vast amount of pride over the years in saying whatever he felt, regardless of who it upset, partly one suspects because it’s good for the show’s controversial stance, and partly because he genuinely likes to run his mouth. And there are millions of people who love him for it.

Those people seem to number among them the most vocal proponents of the ‘forgive Jezza’ movement, and from what I can tell, they appear to have hinged their argument on two main ideas: that because he’s the spiritual leader of Top Gear, the show will be nothing without him, and that since that’s just his personality, he should be allowed to get away with things that others may not.

When you strip emotion and fanatical fandom from the argument however and examine the facts, the story is pretty simple. An employee, who had already received several warnings for his behaviour, verbally and then physically assaulted another employee.

In most, if not all organisations, that is a sackable offence.

When you’re such a significant generator of revenue however, it brings with it a host of new dilemmas. Forget his celebrity; were Clarkson the number one sales person for his organisation, the same question would have to be asked: if we lose this guy, we lose a whole chunk of revenue. If we keep him, we compromise a rule which we will struggle forever to enforce in other, similar situations. So what do we do?

Let’s be clear: the BBC did not create this situation. Jeremy Clarkson did. The BBC did not pick this dilemma. Jeremy Clarkson did. The BBC, it seems highly unlikely, would have ever chosen to cause probably fatal damage to one of its most successful products by firing the star, but as an organisation, it didn’t initiate the events that led to it. Jeremy Clarkson did.

So what do you do? I think I’d be joined by 99 out of 100 Fortune 100 CEOs in saying that when it comes to a point of Values like this, you have no option but to fire the star. It’s not only okay; it’s necessary.

I’ll miss you Jeremy Clarkson. But I’ll never blame anyone for your demise, but you.

Focus on your talents. Hire or partner to cover your weaknesses

I am great at one or two things. Good at a couple more. Okay at a lot of things and pretty bad at others. I don’t always know what my strengths are, and it’s often interesting to have them pointed out by someone else, but I have a generally good idea of what I can and cannot do well. Maybe you’re the same.

Yet, often, even at my age, I find myself wrestling with things that I really should learn to just pass on to someone who could handle them with ease. I don’t know if it’s arrogance or fear. I do know it’s a waste of time.

One of the greatest gifts you can give yourself as an entrepreneur, is to learn how to delegate. There are many things that drive my business, and only some of them are things that I can do well. Helpfully, three of them are things that I excel at, but the others, are simply things that if I choose to do them personally, will hinder growth, probably forever. Sales is one. Marketing is another. I know people who are outstanding at these things and it doesn’t make any sense for me to try to do what they do better than I can. My concentration is better focused elsewhere.

Delegation is key to growth. It’s also the most liberating feeling in the world when you finally learn to embrace it. That part is at least not new to me.

But here’s what I keep rediscovering: delegating the stuff you can’t be great at is only helpful if you get serious about the stuff you can be. In my case it’s research, content creation and delivery, and delegating the sales and marketing of that frees up more time for me to do it. If I don’t use that time fully though, the team doing sales and marketing will quickly find itself recycling old material, which defeats the object.

The point in delegating sales, as an example, is that there will be far more deals closed by someone who loves to focus on business generation. If I don’t give them updated or even brand new things to sell however, their results will be no better than if I did it myself.

Delegating therefore isn’t about getting work off your back so that you can do less. It’s about getting the wrong work off your back so you can do more of the right stuff. It’s not less work; it may be more. I think, however, it’s what Americans may call ‘finding your bliss’ or something like that.

I’ve never been afraid of hard work. I don’t think you can be and still be serious. I am however, terrified of futile work. Time invested to no good end. If you’re to use the best of your talents, assuming you know what those things are, you simply have to let go of the rest and find someone else to do them.

There’s an irony though. The one thing you can’t delegate is the act delegation itself. And that’s the one thing almost nobody is very good at.

Sell. You’re not above begging.

I’m always baffled when people say they can’t sell because there doesn’t seem to be any point in that statement if you want to grow your business. The backbone of such arguments normally references someone who is really great at sales as proof that they can do something you can’t do. It’s such an innate way of being, you may argue, that there is no way you could possibly be good at it because you ‘lack the gene’ or something.

Maybe. But you know what irks me? The only time people are polite about salespeople is when they’re using them as a smokescreen to get out of the line of fire. The rest of the time, you probably aren’t nearly as positive, which tells me something important: it’s not that you can’t sell; it’s that you won’t because you think it’s beneath you. You’re the creator, the mastermind, the visionary; why the hell would you subject yourself to a situation in which you might conceivably have to beg?

The answer is a simple one. Because starving to death is worse.

Anyone who can clearly identify a role they refuse to take on during the building stages of a business, simply isn’t fully committed. I’m not what you might call a salesperson either. I also believe there are people who can do it better than I can. I believe some of those people have genuine intuition. I’ve seen it, and it’s impressive.

But nobody wants this more than I do. Nobody cares about the success of my business more than I do. The business depends on paying customers, which means I have to play a leading role in finding those customers and having that sales talk. It’s not a choice. It’s a responsibility.

Sometimes what I do feels a little bit like begging. Sometimes it’s uncomfortable. Much of life is like that. If you’ve got any juice in you at all however, you’ve probably embraced discomfort many times, in order to get something you want. I doubt there is anyone who can honestly claim they have not.

So you can do this.

The ultimate advantage of getting out and selling is that if you do enough of it, and you’ve got something worth buying, you’ll begin to make money.

If you think that is beneath you, you’re in the wrong game.

Work is not an end. It’s a means to an end.

Around about 3am, I had a reality check. As I looked up, bleary-eyed from my laptop where I had been putting the final touches to a pair of proposals, I looked straight into the equally bleary-eyed face of my wife, Linda, also working away late into the night. The children were asleep. Even the dogs had long since gone to bed. It suddenly felt like perhaps, this demands some attention.

I don’t think it’s uncommon for entrepreneurs to keep odd hours. I don’t really see how it’s avoidable, especially when there is a family that needs attention and life-matters that take up inconvenient amounts of time. We stopped work in the late afternoon when the child minder knocked off, bathed the children, had dinner together, read stories, put them to bed, and caught up with what was going on in each others’ lives, and then we simply flipped back into work mode. Another eight hour day on top of the previous eight hour day, and that’s kind of how it goes for us.

The conversation took an ugly turn at 3am however. What the hell are we doing? And why are we doing it? What is the overriding idea, here? It’s a crisis of common sense that we both love what we do so much that we like to press on long after all the healthy-minded people have gone to bed. There is always more to do, and bigger and better ideas that capture our attention, and so we constantly find ourselves putting in just one more hour to keep things moving along. That much is probably a blessing.

But how long is this going to be fun? How long until something snaps? And is it all worth it?

The pursuit of a business dream requires as much focus on the journey itself as on the end goal. If you want to create riches through your own endeavours, you’re going to have to have the mental and physical capacity to ignore normal limits and really push yourself. Linda and I are experts at that part of it. It’s why things keep building around us and we can both clearly see growth in all the desired business areas.

But it dawned on us that we’ve largely lost sight of the goal. And neither of us realised that had happened. For me, the dream has never been a garage full of Italian cars or any of the other trappings of wealth. I want my children to have the very best opportunities around and if they do well enough to be accepted at the best university in the world, I want to be able to pay for it. I’m much more driven by responsibility than greed.

There doesn’t seem to be much point in sending them to Harvard however, if I don’t live to see them graduate, or have mired myself so thickly in business responsibilities that I can’t get over to the United States at any point during their studies to visit them, buy them a meal or take a holiday with them.

It’s easy to get carried away by what is happening right now. But the conversation we had early this morning is one I recommend every entrepreneur engages in. I don’t buy the theory that you must always build a business with an exit strategy, because it’s not my intention to stop what I am doing and cash it all in. I do think it’s critical however to get it solidly in mind that what we’re doing right now, must have a purpose beyond the mere doing of it.

These late nights, and all this extra effort must themselves be part of a fixed-term goal to release responsibilities and take a more relaxed role. Work itself cannot be the end. I bet there are more than a few entrepreneurs who forget that.

Pick your mentor wisely to find someone with provable experience

I’m a big believer in mentors. Coaches. People with experience, who can help me do stuff better, in life and in business. I find it really useful to talk things through and since I’m determined to grow, I’m open to having my opinions swayed. The challenge for me has always been that of finding people who have the magical combination of real experience and the time to talk about it.

I don’t necessarily buy into the trite and slightly insulting saying that ‘those who can, do; those who can’t, teach’ but I am certainly wary of the hundreds of success and business coaches out there who seem to exert as much energy blurring their back story as they do promoting claims of their own capabilities, all the while offering to turn your life around for a hefty fee.

Since there’s too much at stake for you to risk dealing in snake oil, you’re better off finding an executive – a CEO if you can – who is actively involved in the business they have built, and offering them a fee for a monthly hour of their time. It’s my inflexible view, that if they’re to have any real value, mentoring should not be their primary role.

There are two reasons for this: the first is that they have real experience, not theoretical knowledge. You can learn from business books, but knowledge is always out-trumped by experience simply because the pain and elation of associated emotion gives you a much richer experience. You can read about something from the sidelines, but it’s nothing compared to 80 minutes on the field.

The second is that because they are still active, their experience is still being built. There’s nothing master/servant about a relationship built between two people who are battling through similar things. At times, the mentor can become the mentored, adding loads of extra depth.

The snag is that because they’re actually doing the things they claim to know about, they’re mostly not available to share their time, and can be unreliable at that. Sudden crises happen and the Tuesday morning session you’ve planned has to be postponed. Added to that, their weekends are not for sale because their weeks are so densely packed.

You’ll have to find a way to fit flexibly into their schedule therefore. A month is 168 hours long. for a CEO, it’s probably closer to 220. Maybe a few more. Your hour can probably fit snugly in the middle there somewhere, but be prepared for it to move around.

Be prepared also, to be specific. It’s your money you’re spending, and their time you’re taking up, and you should treat both of those with respect. Even if you’re willing to drop thousands for little return, you won’t earn their interest for very long unless you’re bringing them something interesting to help work through. Let your mentoring sessions be problem-solving ones. There’s no other real value in a mentor than that. You can chit chat with your friends.

I’m a big believer in mentors. But the wrong one is as value-less as the right one is valuable. Make your decision carefully.

How much information do you really need to make a decision?

One of the worst things for any entrepreneur is to deal with a perfectionist. These people are like Kryptonite to Superman when it comes to decision-making because at least in the early stages of a business, absolutely nothing is perfect. It’s chaos. It’s madness. It’s not even very clever half the time, no matter whether we think it is. Perfectionists are just a terrible fit.

If I have learned anything in the insanity of building businesses, it’s that you have to make decisions with a limited amount of information. That may be anathema to an MBA graduate, but it would probably make perfect sense to a military leader. No plan survives first contact with the enemy. You can’t make the perfect decision. Sometimes you just have to go.

The question then, is how much information do you really need to make a decision? The only possible answer is that it depends on your appetite for risk. If it’s high, you don’t need much. If it’s low, you can never have enough. That’s probably obvious.

What’s not obvious is the dividing line between intelligent low-information decision-making and gambling. Gambling, no matter what the movies attempt to depict, is bloody stupid. Which means to me, you’ve got to have a little more intelligence about you before you leap into the unknown. Appetite for risk isn’t the same as willingness to commit financial suicide.

So how much information do you need?

Let’s break it down. Ex-United States Defence Secretary Donald Rumsfeld was and remains a jerk and there’s little to be learned from him short of a billion cautionary tales. But he did once say something which in his bizarre rhetoric came across as … bizarre … but which is actually surprisingly bright.

He spoke about four things: known knowns, the things you are certain of; known unknowns, the things that you know you don’t have enough information about; unknown knowns, the things that you don’t realise you know until they’re suddenly up in your face, and unknown unknowns, the things you don’t have the faintest idea exist and therefore have the ability to blindside you.

I know. it’s gobbledygook. But bear with me.

Leave out the things you know you’re an expert in and the things you know you don’t know enough about and therefore approach with trepidation. Leave out also the things you don’t realise you know, because they’ll present themselves to you when you’re forced to think a little harder.

The buggers are the things you didn’t even know you needed to know.

Those are the ones that make the difference between gambling and low-information decision-making. The gambler is unwilling to predict that anything unusual might come around the corner. The low-information decision-maker is at least half-primed to accept it. Neither of them is particularly well-equipped to deal with it in advance, because by definition, you can’t be. How can you prepare for something you haven’t even imagined?

There is ample evidence however, that in at least knowing that your greatest plans are probably flawed, you can react intelligently, as long as you’re deep enough and broad enough to be able to apply lateral context. Your most important knowledge is non-specific. What have you seen, heard of, read about, that triggers a linking of dots? If you don’t have that, you’re naked.

Which bring us back to the first guy. Perfectionists don’t have any context beyond the flawed object that is in front of them.

How much information do you need? The truth is, you cannot know. Sometimes you just have to go. Preparation isn’t science. It’s a way of being. That’s probably why so few entrepreneurs actually build businesses that grow.