February 18, 2019
The 3-Legged Stool of Business Success
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The three legs of a stable stool of business success are:
Just as the legs of a stool are most stable and dependable when they are of equal length, these three elements are of equal importance for sustained success and stability in business. Let’s unpack each of these three legs.
If you own or manage a business you know your strategy and your team knows this as well. After all, that’s what everybody is focused on as they show up and work every day, right? Not necessarily. I had a client that was a family owned (closely held) corporation. They had been very successful for several generations and held a dominant place in their industry. The current CEO had a clear picture of the company’s strategy. Yet, for some reason he reached out to me because he feared that the company might fail on his watch. Imagine being the head of a national company with family members in most of the senior leadership and many key management positions. The company has been a success for roughly 125 years. You think everybody knows your strategy and works every day to execute on that strategy. But, something in your gut tells you that this may not be true. Your doubt is keeping you awake at night. Compounding your worries is an anticipating that you may need to make significant changes to continue to be competitive. You know that a viable and sustainable business must adjust as markets and technology changes. Doing what you did for the past century plus is not working as well as it used to and you need help figuring out where to go from here.
When I first met with this CEO he was sure that he could call all of the senior leaders in for a strategy session (which he hired me to facilitate) and after a weekend we would have a shiny new strategy that everyone would love. Since I do a lot of facilitation work, I suggested that we survey the senior team to find out their answers to the two questions that I had already asked the CEO:
The CEO didn’t think that this step was necessary but he agreed. When we got the results of the survey he was a lot more worried than he was before because we got as many different answers to these two mission-critical questions as there were people responding to the survey. Since this is what I expected, I was prepared to talk him off the edge and explained the steps that we would take at their strategic planning meeting to move from a whole group of people who thought they were all moving in the same direction to actually having a team with one strategy and a plan to succeed. The happy ending is that we did that work over 20 years ago and the company is still successful and that CEO sleeps at night.
Without a unified strategy, that defines what you do for your customers, it’s difficult to know what to do to assure that you maintain customer satisfaction. Your business may have identified key performance indicators (KPI) to measure customer satisfaction but are asking the right questions? Are you addressing what matters to your customers? If your leadership team isn’t working from the same strategy is it likely that you are looking at the right stuff to know? It’s possible to be asking a lot of questions, measuring KPI, and have no idea what keeping customers requires. Keeping customers is a significant element of customer satisfaction.
“Satisfied” just means the customer isn’t actively looking to replace you. “Satisfied” can be an easy win your competitor. Especially if they are clear on their company’s strategy. When the competition communicates a clear message to the customer, your customer, “satisfied” may be replaced with “I want what they are offering!” All of your people need to know your strategy and buy into that strategy. This provides a base for your employees to create excited customers. The good news is excited customers are generally loyal customers.
This one is actually pretty simple. If you create a culture where your leadership team communicates a clear strategy, one that they buy in to, the team will have a lot fewer “why” questions. The team will find it much easier to know what to contribute and what they need to communicate to your customers. Employee engagement is tough to have when your employees look at the senior leaders and see that they are not all working to execute on the same strategy. It’s often easier for front line workers to see that KPIs are not measuring stuff that really matters to customers and that the bosses don’t have a unified strategy because your employees are trying to make the connection between you and the customers. Once employees discover a lack of strategic focus they tend to disengage. To build an engaged high-performance team start with doing the work to assure that the leadership shares one strategy. And that they all buy into that strategy (if it’s the right strategy and someone on the senior team can’t buy in they may be working at the wrong place). Once you have a clear strategy, align your KPIs and customer satisfaction standards to that strategy. Finally, communicate with your people so that they are clear on the strategy, their role and responsibilities, and how the strategy is being measured (KPI). Remember that communication is two-way so be sure to have a plan to listen to your employees so that you are able to benefit from front line feedback for future adjustments to your strategy.
This is simple but it is hard work. Once you build the stool, you will need to maintain it so that you don’t drift off and lose focus.
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