Does Everyone on Your Team Know the Goals?

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Transparency in business leadership is critical. When leaders are transparent, they build trust and credibility. Their teams generally have a more favorable view of them, as well as the company as a whole.

Transparency encourages open communication, problem solving, and respect. These are the foundations of a strong company culture.

What Happens When We Fail to Be Transparent

Still, many companies and managers struggle with transparency. They will point out the potential pitfalls with too much transparency.

What happens when you have to make difficult or unpopular decisions? What happens when ethical or regulatory questions arise? What happens when confidential insider information gets leaked to the press or to our competitors?

While it is true that some secrecy is required at the highest levels of an organization, the more transparent we can be, the better. And that’s not just a matter of culture. It’s a matter of performance.

Study after study has shown that healthier company cultures lead to stronger company performance. And when management is open and honest with their employees, they give them the tools to succeed.

Share the Goals

In most companies, you get a kind of goal pyramid. There are overall goals at the very top – revenue growth, profitability, etc. – that are driven in turn by shorter-term goals that vary from department to department. Marketing goals, sales goals, financial goals, hiring goals, product goals, and more. They all build on each other and successfully hitting all the individual goals should lead to the company hitting those top level goals we started with.

You count on your team to help meet the goals of your department. But do you share with them what those goals are? And if you do, do you also share with them the larger goals for the company?

In the spirit of transparency, we should all strive to share all the goals the company is aiming for. Our teams deserve to know how the work that is expected of them is going to help the company achieve its goals.

This kind of openness encourages feedback, incentivizes performance, and adds meaning to each and every role throughout the organization. When your team members all know the goals, they can do their part to help reach them. Otherwise they are just checking boxes as part of some vague mission that does not involve them.

Conclusion

Be open and honest with your team and you will drive better performance.

Surround Yourself with Dissenting Voices

For leaders within a company, it can be tempting to surround yourself with people who think like you. You probably have a clear vision of where the company should go, what it should focus on, where it should put its resources to succeed well into the future. And people who agree with you will build you up and work tirelessly to see your vision come true.

If that sounds great, it’s probably why this practice is so pervasive in companies today. And it’s also why advice to do the exact opposite is so important.

The most successful strategic leaders are in fact those who surround themselves with people who see the world and think differently than they do. While that may seem backwards, consider how that works:

  1. You are not going to be right all the time. The more people around you who are empowered to speak up when they disagree with you, the better the odds that your worst ideas won’t make it past the starting gate.
     
  2. You need advocates for different groups. Even your best intentions may be in direct conflict with certain groups you represent, say your sales team, the women in your organization, or existing customers. A well-rounded leadership team includes representatives to stand in for all stakeholders.
     
  3. Good ideas can always be made better. The people around you who may not see the world or approach problems in the same way you do will often have their own ideas about how things should be done. That doesn’t mean these ideas will always run counter to yours. In fact, many times they will enhance your ideas and help create an even more effective strategy.

Strong-willed leaders who don’t deal well with dissent are doomed to fail more often than not. And though dissenting voices may slow a company down at times, they will almost always lead to better decisions and more well thought-out strategies

In Defense of Meetings

The meeting gets a bad rap. Why?

Most people describe meetings they have experienced as:

  • Long,
  • Boring, and
  • Pointless

Meetings exist because they must. We put them on the calendar, so we must hold them. In a large company, it wouldn’t be uncommon to spend most of your days in one meeting or another.

Experts have long written about the stupidity of meetings, and the need for their death.

And it’s true, most meetings are a waste of everyone’s time. But that’s because most people don’t know how to run effective meetings.

Conducted effectively, meetings can be:

  • Short,
  • Simple, and
  • Critical to success

We don’t need to kill meetings. We need to kill bad meetings. And it starts with setting some ground rules.

Meeting Ground Rules:

  1. All meetings should have a defendable need to exist. If some other activity can accomplish the same goals as your meeting, it’s not important and should be scrapped.
  2. Meetings should have a clear goal, defined by the meeting organizer, which all the attendees should know in advance.
  3. Meetings are for making decisions, which means that it is up to the meeting organizer to plan well in advance and make sure every attendee has everything they need to come prepared to jump right in.
  4. Meetings should involve the absolute minimum number of attendees needed to make a decision.
  5. Meetings must have a reasonable time limit. Everyone must arrive promptly and work toward a resolution quickly.
  6. Meetings end when the decision is made. They should leave attendees with a set of actionable next steps.

Meetings are a necessary part of doing business, in most companies at least. So instead of looking at them with dread, let’s take the steps needed to make them better.

Prioritize New Hires

For many entrepreneurs and small business owners, one of the greatest joys that comes from running your own business is being able to hire new employees. It just feels good to be a job creator, to give others an opportunity they might not have otherwise had.

May we all be so lucky to be able to hire new people. But just because you can, doesn’t mean you should. Or at least you shouldn’t rush into it.

Because the big question remains, who should you hire?

The keys to prioritizing new hires:

  1. Fill a gap – hire someone who can do something you urgently need and can’t do yourself
  2. Free up your time – hire someone to take on tasks you’re doing that are keeping you from more important chores, like growing the business
  3. Open new doors – hire someone who knows how to do something you don’t, preferably someone who can lead new growth, ie. Product development, marketing, business development, sales

For a small business, your first hires are incredibly important. As the team grows, those first hires will help you lead and grow, helping to establish a culture and define strategy. So make sure you are hiring the right people, for the right positions.

How to Set Employee Compensation

There are a number of ways to set the compensation for your employees. And when you’re starting a business, or in the process of hiring your first team, how to pay them is an important decision you will have to make. Because a lot of times, whether we like to admit it or not, how we are compensated for something affects how well we do it.

Last week we looked at two competing viewpoints. We made the case for paying employees more, and the case for paying them less.

But today, I wanted to offer a middle-ground solution that new managers can use to set appropriate levels of compensation. Here are some things you should be prepared to do before you start:

  • Look at job postings for competitive positions at other companies to get a sense of what the going rate is in your area
  • Ask people what they are expecting during the interview process
  • Identify areas of each job that can be compensated based on some performance metric
  • See the big picture and don’t get cheap (that does not mean I think you should be reckless either)

Now, for each position for which you need to set compensation, it will ultimately depend on who you employ. I don’t believe in setting a standard salary for each position and anyone with that title makes the same amount. If you hire someone that can do the job better than others, they should be paid more.

That is where performance based compensation can come into play. And I encourage you to structure compensation plans with some performance based bonus included, because it is an incentive that will attract the truly talented people to your company and will weed out those hires that just want a job.

And so, you have a general salary range that you know is the going rate for each position. And you have another range that your candidates and hires are looking for. Compare the two, and if they seem to match up, you are in a good place. Then apply some level of performance to the mix, which will allow you to lower the overall base salary but still attract talent in the group of candidates. And always err on the side of more, rather than less.

That is a perfect strategy for setting compensation for new hires, and one that I personally have used and seen in use in a number of successful small businesses.

Any questions?