Category: Management Skills


Mourinho directs his troops

Image, ‘Mourinho directs his troops’ copyright Flickr user Ronnie McDonald. Used under Creative Commons.

As a Chelsea supporter the team’s poor start to the Premier League season has been hard to watch.  Having won the Premier League title last season, this season the team stands at 15 out of 20 teams – something unheard of for a team of generally used to be in the Top 3.  They keep on losing and losing badly and the normal action of owners in the premier league when a team’s performance declines precipitously has been to fire the manager.

How things play out in the next month at Chelsea will determine how it will go for the next five years.

A common problem

As somebody who coaches CEOs on both leadership and management the challenges facing the club are commonplace within large organizations.  CEOs have big plans which they expect their managers to deliver.  Abramovich’s vision for the club is one of long-term domination of the game. He has also stated that they must achieve a Top 4 standing in this years league in order to be eligible for the Champions League Tournament the prestigious European Knockout competition for the top clubs.

As in many large organizations the problem is largely one of differing expectations and unclear accountabilities – the vision determines how managers manage, rather than management successes being seen as a means to the long-term vision and when things don’t go to plan the Chief Executive applies pressure on managers to perform, rather than trusting in the talent and creating an environment, in which they can do their best work.

This environment cannot be created while the threat of being shown the door hangs over every performance. Abramovich has demonstrated leadership and set to rest any suggestion that Mourinho’s future at the club is in doubt – at least in the short-term.  He then needs to allow his manager to manage the talent available to him in order to deliver both the short-term league success and the owner’s long-term vision.

Blame the manager

Chelsea have had 11 managers in as many years.  The Club’s board has never seemed to take a long term view and as a result appears despite the huge capital investments made in talented players, is incapable of building an organization with the long term potential to become a world class soccer club – a force to be reckoned with. Does Abramovich support a culture of deliver or die or does he create a culture that enables his manager – a manager with a huge track record of success and is loved by all the Chelsea fans – to be given space to address the challenges of his under performing players.

Chelsea Football Club is a business.  A large business with major capital investments.  Its employees need consistency and stability to deliver results.  Abramovich needs to ensure that the “current storm of losses” can be managed through.  His employees need consistency, stability and clarity if they are going to deliver results.  The last thing he should do now is throw his manager overboard.  He does that and yet again any possibility to build and implement a long term strategy is ashes.

Having done this the confidence this will be achieved, of both the manager and his players, should improve.  As a result, the on-field performances are likely to improve and.  This was unlikely while there was a question over Mourinho’s future.

I think this is the right decision.

Leadership & Management

Solving the problem at Chelsea requires both leadership and management. It requires Abramovich and Mourinho to work together, rather than independently. Turning things around on the pitch needs to be Mourinho’s accountability.  Creating a culture that allows him to do it requires Abramovich to demonstrate leadership.

A CEO is accountable for all the behaviour and results of their company.  Today VW CEO Martin Winterkorn admitted that the company he is the chief executive of had mislead both regulators and customers. How is it possible for a global company fraudulently installing software in their cars to deceive their customers and regulators without the knowledge of the CEO?  This scam, due to its scope and scale, had to have the ear of senior management.

Volkswagen wants to be the largest automaker in the world, but how dare they have this aspiration when they get caught in such a sophisticated scam that is so stunningly deceitful. A company has an accountability to serve the communities it works and sells in.  It must demonstrate responsibility and care to this community.   When it breaks this bond of trust it loses it right to serve these communities.

Today VW launched a mea culpa PR initiative in the US.  The strategy being if you say sorry your customers will forgive you.   I believe this goes deeper….the company is sick and there must be consequences for this failure.  Winterkorn has, it is reported, refused to quit.  If the board is serious about ensuring this never happens again it needs to fire him when it meets later today.  Only then can they start a process to eradicate a culture, led by their CEO, that produced such duplicitous behaviour.

If they do not nothing will change.  How dare they fail to hold Winterkorn accountable for this scandal.

Reading @AndreaFelsted‘s piece yesterday in the Financial Times about Tesco one year in to Dave Lewis’ tenure as CEO, I was reminded of the piece I wrote on the importance of management in turning around the former UK retail heavyweight’s fortunes.

It is clear that Mr Lewis has failed to manage.  He destroyed the contract of trust by cutting thousands of head office jobs.

A CEO who cuts employees is an abject failure – his/her strategy did not work & employees pay the cost. Mr Lewis inherited this mess, so conveniently he can sidestep the strategy issue, but the fundamental problem remains: that he further strained the contract of trust while negotiating his compensation package.

Why would Tesco expect anything else from their employees but distrust, disconnection, cynicism and low morale?

Learn how to master the craft of CEO management at www.howdareyoumanage.com

One of the highlights of Management Today’s coverage of its #MTLive event recently was hearing from Andy Street, CEO of UK retailer John Lewis Partnership.  Street is, by the publication’s measure, Britain’s most admired business leader.

Reading his comments and, subsequently, a series of articles written about him it’s not hard to understand why he is most admired. But he is, first and foremost, a Manager not a Leader.

In one Management Today piece Street attributes his success to strength of the business model he inherited; a business model created by the founders son in 1929 and adhered to ever since. Street is the steward of this model.  He is accountable for creating and executing a plan that allows the company to prosper.  And, prosper it has.  While many UK retailers have struggled in difficult trading conditions and increased competition from low-price retailers John Lewis’ premium business has weathered the storm better than any other.

How has it done this? Andy Street says he thinks it is in large part down to the culture of the organization. “People trust organizations because of a sort of total peace around the organization. So we want to be perceived as an organization that’s a good employer and has a fair approach to pay, for example”, he told the publication.

John Lewis are renowned for their staff’s morale and engagement. This requires clarity – everybody must know what they are accountable for. This requires direct, truthful, conversations; sometimes difficult ones. This also requires transparency. But, most importantly, it requires management.  Most companies struggle to create a culture where employees are engaged and inspired.  The most common cause is not a lack of a leader – somebody pointing the way – but the lack of a Manager.

The Partnership in the John Lewis name means that all employees share in the profits. You might think that having partners might make direct truthful conversations about corporate and individual performance – and applying consequences – in a transparent way difficult. But, says Street in his #MTlive interview, it makes them easier.  Management and employees at John Lewis are able to have direct truthful conversation that are accepted and understood by all – and this produces significant competitive advantage in innovation, customer engagement and strategy execution.

Creating and maintaining this culture doesn’t happen by accident: it starts at the top – with the CEO and senior management team. Creating it is easy; maintaining it is incredibly difficult. It requires continual management.

I believe Andy Street should be recognized as Britain’s Best Manager – a far greater accolade in my book than the one already bestowed on him. He doesn’t just point the direction, he manages the organization to ensure it achieves its goals for the benefit of every single employee.  I call it CEO management.

If you’re a manager Gallup’s latest “State of the American Manager” is painful
reading. Our profession is full of incompetent, overwhelmed managers who do not
care for the role they have chosen. As a result, they inflict pain and
suffering on those they are supposed to be managing. Only 35% of managers
are engaged, 51% are not engaged and 14% are actively disengaged.

In his introduction Gallup CEO Jim Clifton pulls no punches. “Most CEO’s I know
don’t care about their employees or take and interest in Human Resources”.  This
disinterest and disengagement costs the US economy $319 billion per year.

The report states that their research showed 1 in 2 – HALF of US employees left
their job to get away from their manager and improve their personal life at some
point in their career.  I can testify to that – it happened to me twice in my
early career. The report says that just 30% of workers are engaged in their
work and connected to their company.

I believe all employees have right when hired by a company to be given work that
grows their self-confidence and feeling of self worth. This is a common sense
and win-win for both the employee and the company. But, it requires managers
pay attention to their employees, manage them with respect, give them work that
interests them and enable them to learn and grow they will get higher levels of
engagement and quality of work.  It requires a framework for managers to acquire
the skills they need to manage large groups of people effectively.

The opportunity for improvement is massive. What CEO’s and their executives
think their management work is I do not know, but Gallup’s report suggests they
need to find out. And quickly!

This is a question I have asked hundreds of Chief Executives over the years. I’m always fascinated to hear how they describe CEO work.  Most can’t answer this question succinctly or clearly.  Many have “bits” of an answer. Few could describe a comprehensive integrated management process that can be communicated in a comprehensive manner to their senior executive team.

Another question I’ve asked repeatedly over the years is, “what is the difference between leadership and management?”.  It leaves most floundering. Many have been chief executive officers of large organizations for many years, managing thousands of employees, but the majority have clearly not taken much time to consider the difference.  These CEOs end up being neither a manager or a leader, to the detriment of their own personal performance and that of the organizations they spearhead.

Their failure to differentiate between leadership and management also means they cannot define clear expectations for either.  Predictably, without clear definitions, their senior executives manage inconsistently.  This, in turn, leads to a lack of clarity for front-line managers and employees.  It ends up becoming a vicious circle.

The problem is that when you take on the management mantle of CEO of a company, the assumption is that you have all of the skills necessary to do the job.  As the chief executive of an organization it is assumed that you have the training and experience to help your organization fly with the same level of confidence and expertise a 747 pilot sitting on the runway with a fully loaded plane of passengers preparing to take off. The reality is often very different!

A 747 pilot is prepared for the job.  They’ve gone through a process that, to reference Malcolm Gladwell, has involved thousands of hours of practical experience. They will also have piloted the plane as First Officer under the tutelage of the Captain on many occasions.  A new CEO, on the other hand, often has not had the hours of job-specific training, nor the extensive study of the theory, principles and processes they need to effectively manage a large group of employees.

Many CEOs also take over accountability for their ‘aircraft’ in mid-flight! They often take over when something has gone wrong, usually something serious.  Yet, they are then expected to diagnose the problem, fix it, file a new flight plan, change heading and land safely – often at a destination that was different from the intended one. They are expected to do all this while learning how to fly a plane they’ve never flown before.

Thank heavens a company never leaves the ground!

From my experience, part of the success of a new CEO is the ability to provide their managers with a philosophy, a set of principles, processes and disciplines, and demand they practice them to an exemplary standard with clear accountability. It is the only way to attain a level of performance within their organization that enables everybody to perform to their best work.

I define this process as the Craft of CEO Management.  A Craft, since the Middle Ages, has been the lifelong pursuit of mastery in a chosen profession. For chief executive officers the profession is CEO management. It presents an opportunity to choose a management philosophy, structure, set of principles, processes and disciplines and then practice using them for the rest of their career.

A Chief Executive must strive to be a master the Craft of CEO Management.  Mastery of the Craft represents the single greatest great opportunity for performance improvement for senior executives.  Those who take on the challenge; reflect on it; learn from it; and integrate all the management work of their company achieve higher levels of engagement and better results.

Those CEOs who avoid this essential management work are unable to execute their duties to the best of their capability.  The performance of their organizations suffers because they are unable to get the best out of the hundreds of employees they manage.

So, do you dare to master the Craft of CEO Management? Which philosophy will you choose?

Nick Forrest

Utter the word “service” and what springs to mind? Servitude? Servants? Slavery?

Too bad. Because the concept of service should be elevated to a loftier level.

People used to go into public service because they wanted to contribute to a better society. Historically, many commonwealth countries adopted the motto, “Peace, order and good government”. This phrase describes the principles upon which Canada was founded. What a great saying: it oozes stability and contentment, which is what most citizens crave and need to succeed.

Likewise, top executives nowadays have forgotten that with great power, comes great responsibility. Their actions affect not only their shareholders, but also their employees (which may number into the thousands), their customers and suppliers, and the community at large. Repercussions of their actions may ripple across continents.

How about they stop, for a moment, and think about service? They are in service to the community.

Nick Forrest