In today's issue
>> A note from Rand
>> Feature Article: Expense Reduction and its Unintended Consequences
>> Additional Thoughts: Create a Toleration-Free New Year
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Note from Rand
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Many of us believe that success is the result of hard work alone. I’ve come to believe that while hard work is necessary for business success, the priority of happiness is missing from the equation. Without finding the appropriate outlet for our talents and passion, hard work alone becomes the equivalent of racing east, looking for a sunset.
Take some time during the next month for reflection and self-examination. Ask yourself if your talents and passion are fully utilized in your life. Be grateful for your blessings, but not resigned to accepting an unsatisfying status quo. Each of us is meant to be wildly happy and totally fulfilled.
This month’s columns examine two topics. The first reveals the flip side of expense reduction. The second encourages you to eliminate the things in your life that you just tolerate. I think you’ll enjoy them.
Give me a call or an e-mail with your comments, questions or requests for future pieces and have a wonderful holiday season!
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Feature Article: Expense Reduction and its Unintended Consequences
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I was working with the executive team of a Fortune 200 company. During a strategy development session, the CEO reiterated his commitment to reduce the firm’s expenses by 20 percent over the course of the ensuing 24 months. During that session, he froze the senior vice-president of sales and marketing with an icy stare and the following exhortation, “John, you’ll be able to hit your sales targets despite these expense reductions, won’t you?” John responded with his typical enthusiasm, “Sure, no problem!” After the meeting, I saw John in the hallway. He was, shall we say, less certain.
I later commented privately to the CEO that I believed, after reviewing the assumptions in the company’s sales plan, that the planned expense reduction would kill their chances of meeting their plan. His response: “I pay these people lots of money to overcome obstacles. John’s a big boy. If he said they could do it, they’ll do it.”
They didn’t do it.
Here are the problems:
• Expense reduction always hits the bottom line quickly. The corresponding impact on the top line takes longer. As a result, executives usually rationalize that impact away. Many CEOs don’t contemplate this. The great ones do.
• People have a burning desire to please the boss. Accordingly, when asked to make a commitment – even about something really important and on the spur of the moment – many executives will cave in to the pressure. Many CEOs don’t recognize the power of their own voice. The great ones do.
How could this have been handled more effectively? Let’s revisit the strategy session. The CEO could have said, “John, have you and your people contemplated the impact of these reductions on our sales plan?” When John responded in the affirmative, the follow-up could have been: “The company’s results are at stake here. We should all have a comfort level with the exact nature of that impact and the precise actions you have planned to overcome it. Let’s set aside an hour or two this afternoon (assuming John is ready) to discuss this.”
How would you have handled this problem? Would you have been willing to subordinate your ego to the complexity of this situation in order to get to the right answers and to increase everyone’s confidence. Would you have recognized that, to engender genuine commitment and enthusiasm among the team members, you would have needed to deal with the reality and complexity of this situation?
Effective executive decision-making is a focus of our practice. Call us; we’ll help you!
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Additional Thoughts: Creating a Toleration-Free New Year
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Everything we do has both costs and benefits. That includes the things we tolerate, those nuisances we carry around with us from year to year. Our office is a bit messy – no big deal! One of our friends is a real downer – so what?!
Over time, these seemingly harmless conditions and people rent space in our psyches. Pretty soon, we’re carrying around an insidious anchor. It’s insidious because, while each individual toleration is relatively harmless, the sum total of their accumulated weight makes healthy, happy functioning difficult. It’s insidious because most of us have been conditioned to accept these tolerations as a part of the burden of living a normal life. How many times have you heard, “Go along to get along?” When was the last time someone admonished you not to “rock the boat?”
Nothing you can do in 2005 will benefit you more than systematically eliminating your tolerations. Rather than wait until the new year, why not take get started now? Here are a few suggestions:
• Make a list of 20 things that you put up with.
• Pare that list down to a manageable number of five. For each item on the list, answer the following question, “What has been the payoff for retaining these tolerations?” Here’s the deal: Everything we do has a payoff. For some, it’s the comfort of risk aversion. For others, it’s a disinclination to initiate conflict, because they don’t have the tools to handle it productively. You get the idea.
• Document the corresponding costs of each. These are probably not financial; rather, they likely impose a psychological burden that far outweighs any payoff. We often justify the status quo, but it's important to get to the real truth about the costs.
• Select the costliest toleration on the list and develop an action plan to eliminate it. Don’t start working on the second one until you’ve developed some momentum with the first. I recommend allowing one month before beginning the second item. After all, it takes at least 21 days for any habit to become established.
Have a great, toleration-free new year.
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About Rand Golletz
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Rand Golletz is a executive coach and consultant. With more than 25 years in leadership roles, including CEO, chief marketing officer of a Fortune 100 company and international strategy consultant, Rand brings an unparalleled level of business expertise to his profession.
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