Budget Crunch

As we all finalize our 2009 plans, amidst all the uncertainty, one thing is clear — we are not getting more money!

I have led several turn-arounds in my career, so dealing with a smaller budget is something I am pretty practiced in.

I have found and used techniques to preserve quality and motivation through some pretty serious cuts.

One key approach I have found very helpful in getting through the downturn is to focus on the things you did last year, and think of ways to do them better.

BETTER does not always mean MORE

If you challenge yourself to think through how you can improve the way you do something, you can often find a way to get a better result with the same or even less effort and resource.

This is not the tired “Do More with Less”, mantra that makes everyone including me cringe.  “More with Less” means more work is being piled on.  This is demotivating and seldom works well.

Think about it instead as doing LESS work, but doing it in a BETTER way so it has a bigger result.

Examples of Better with Less

If you spend $1000 on demand generation and it gets you 100 leads, there is a tendency to think that if you want to get 200 leads you need to spend $2000.

When you apply the “better with less” thinking, think about all the things you can do to get 200 leads without spending more money on the same program.  Make program better:  Make the offer better, make the call to action better, make the landing page better, make the follow-up better, make the product better!

If you are supporting a product and you need to support more customers next year, how can you do it better without adding more people?  Maybe make your online interface more useful and clear, or add a community where users can support each-other.

If you need to sell more, improve the value proposition in each deal to get more profit without more work. Or take steps out of the closing process by creating better sales tools, or getting better references.

We all do stupid stuff.  Find it and do better.

When you start a new job, you almost always see ways that the last guy was wasting time and resources and not being effective as you can be.

So step into your job anew, and find all the stupid stuff you are doing, and improve it.

This is a great exercise to do with your team.  Go through your key programs and brainstorm on the stupid stuff you should stop doing, and how you can improve to deliver a better result with less work or less money.

You’ll be surprised with how many ideas you come up with.

This also makes room to add some of the new stuff everyone was looking forward to, which is great for the motivation of the team, and the business.

As a leader it is important to cut the cost of doing the same stuff over and over again so that you can make room for new stuff even if you don’t get more money.   Really, it’s important to do this even if you do get more money.

This is increasing your value to the company as well.  Which is a topic for another day…

Related resources:
Leading vs. Managing: Podcast
Leading vs. Managing: Presentation & Worksheets
Are you Leading or Managing? (blog post)

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Other recent posts:

Does your Work-at-Home Policy Work?
Retaining Top People in this Ugly Economy
Productive Conflict
Squeezing the Oil out of Our Food Supply

You want to provide the flexibility for people to work
at home because:

• It works.
• They like it.  It’s motivating.
• They can be more productive without the
  distractions of the office.
• They have more time and energy for work,
  without the drain of the commute.
• It provides a different, comfortable setting
  which can benefit creativity.
• It takes cars off the road

But managers ask me all the time about dealing with problems that arise.

The big/basic problem is that individuals can be more productive
working at home, but TEAMS can’t.

Teams are always LESS productive when people are not together.

And…

You can be left wandering the halls of an empty office when you actually need people to be there.

Or worse, your boss is looking for someone, you are traveling, and no one is there. 

If not managed effectively, productivity can suffer, and some people will start to abuse the privilege. (Cue the fuzzy pig slippers.)

                    Plan for both individual and team productivity

Think it through and set desired outcomes, schedules, and priorities specifically for both the individuals and the team.

Here are some ideas that work well for me:

1. What does the team need?

Have your team work together to define clear outcomes for the team vs. individual goals.  What things does the team need to work on together as a team?  How often?  What does the team need to learn as a team?

Structure in-person meetings and office days around those outcomes.

Also use team time to create discussion about what people are worried about, answer questions, and calm uncertainty.  This really helps.  Particularly in this economy.

2. Approve Specific Days

Designate specific work at home days of the week for specific people to:

• Maximize the right people being in the office together at the right times.
• Make sure that there is always a senior person in the office

Require your approval for specific work at home days vs. people developing the expectation that they can just not show up on any given day, then send an email saying “I’m working at home today”.

3. Productivity comes from clearly defined outcomes.

If you define clear desired outcomes for content, schedule and quality, and employees deliver, it should not matter where they do the work, or if they finish it early.

If you’ve given them clear direction on required outcomes and defined stretch goals, it is their choice to then “do more”, or walk the dog.  You don’t suffer. 

But if you are vague on expectations, productivity will decline.

4. Avoid Fridays

The point here is that work at home Fridays, even for most good intentioned humans, really do degenerate pretty easily into long weekends.

If people are getting the work done, you shouldn’t care, but if they are not, or if team performance is suffering, you might want to consider treating Fridays as a “presence” day.  Do team stuff on Fridays.  

I am imagining all of you who are reading this at home on Friday grumbling at me… 

You can always separately offer to your star performers to go home early on a Friday.
Don’t confuse achieving business outcomes, with giving perks.  Do each on purpose.

5. Consider Mondays

Monday can be a great day for people to take advantage of thinking and planning time away from the office instead of just getting swept into activities of the week.

If you have a staff phone call first thing on Monday mornings, you can kick off the week, reiterate strategic priorities and specific expectations, and then people both at home and in the office can get a less chaotic and more purposeful start to the week.

5. Team never in the same building to begin with?

You can’t let lack of physical presence keep you from establishing team presence, and building team performance.  There are some specific ideas for you here.

How have you optimized working from home in your organization? Leave your ideas and comments below.

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As times get more and more scary, don’t expect
your high performers to keep knowing the company
wants them. 

Even if they kind of know they are one of the stars,
telling them becomes even more important when
things get ugly.

They, unlike the rest of the workforce can find a job
at any point in time. 

You need to let them know why they should stay with You. 

So that begs the question:  Why should they stay with you?

Here’s what I say:

• You are not making a stupid choice to stay
• I am staying here because … [don’t forget to share this]
• I understand your longer term aspirations and I will actively support your career.
• You become much more marketable creating success in a struggling business. 
• Achieving in this difficult situation is “interview gold” for the future. (It really is). 
• I want you to stay, and the company wants you to stay

Feeling cornered?

The last point might draw the question, Well, what is the company going to give me to stay?

I tend not to over-react to this question.  I re-iterate the desire to keep them and my personal commitment to their development and support in future opportunities. 

If they are only going to stay because of a retention bonus or a promotion that you can’t give them, then it is a lost cause anyway.  They are too far out the door.  The goal is to keep them from getting to that point in the first place.

Do they know they are considered a top performer? 

Say it out loud:

Yes, there will likely be layoffs, but you are not going to get put on a layoff list.  In fact you are on another list entirely.  A list of people that the company wants to keep.

You can’t promise people anything specific with 100% certainty, but you can (and need to) let them know that the you and company want to keep them.

It makes a big difference.

If you found this article valuable, or you have ideas or feedback, please leave a comment below.

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I was leading a Career Day last week with a group of executives, and we were discussing the topic of how to get your team from the head-nodding, shallow agreement phase, to DOING what you are all talking about.

• Talking does not add value
• Unspoken disagreements do not add value
• Head nodding, then inaction does not add value.

Only action adds value.

A question came up about conflict:

“It seems that to get the kind of clarity you are suggesting will require causing or at least facing some conflict. 

If people don’t agree with the decision, you are suggesting that to get real buy-in you need to bring that disagreement out into the open. 

I don’t think all of my managers are able to do this”.

Another person commented that in a recent survey of managers only 14% of them were comfortable with using constructive conflict to make progress.

“So what do we do with the other 86%?”

Those 86% of people either need to get comfortable with constructive conflict (or learn to do it anyway), re-consider their role in management, or forever be mediocre leaders.

Leading means getting conflict out in the open and working through it:

• Reinforce the expectation that achieving clarity and action will require a trip through conflict, and that this is what they are supposed to be doing.
• Walk through it.  Ask who will disagree? What will their issue be?  What will they likely say? What will you say in response?
• Define what a clear “after-conflict” action plan looks like – Who are the owners? What are the resource moves?  What are the new priorities?  What stops?  Make it clear that they don’t have the job done without this.
• Offer to support them if they need it.  Go to the meeting.  Support your manager to enter the productive conflict period and drive for clarity.
• Give them some training specifically in this area. 
• Not a bad book on the general topic of difficult communications: Fierce Conversations, by Susan Scott

By the way… reasons people avoid conflict:

There are so many reasons that people nod their head in the meeting and then don’t act.

• They just want to get out of the meeting and agreeing will make it go faster
• They weren’t really listening and everyone else is nodding, so why not go along?
• They didn’t really agree, but disagreeing is not worth the trouble – it won’t matter
• They don’t think you’re really serious, so why bother investing any energy in it?

So you end up with a comfortable, but “shallow”, agreement.

The only problem is: there is no real progress, and the work doesn’t get done.

An artificial sense of team harmony or pleasantness, which is followed by a lack of action, does not add value to the business.

Only action adds value.

What do you think?  How do you deal with conflict constructively?   Please leave your thoughts and comments.

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I’m breaking form in this blog post to bring you something “off topic” which I found fascinating.

This is a summary if an interview I heard on NPR’s
Fresh Air with Michael Pollan. 

Michael Pollan talked about the need to change our agricultural policies if we wanted to solve our oil dependency, environmental issues, healthcare issues, and economic crisis.

First the back drop (things we know):

• Our farmers are subsidized to mass produce corn and soy – ingredients for highly processed, unhealthy, non-food, vs. real food. 
• If farmers accept the subsidies they are forbidden from growing anything else, and are unable to raise animals.
• This subsidized large scale commercial farming uses fossil fuel in two key ways:  fertilization and pest control. 

Some of the key points (things I didn’t know!):

• It takes 1 gallon of fossil fuels to grow and produce 1.2 gallons of ethanol.  I knew it was inefficient but – wow!
• 30-40% of the recent increases in food prices come from diverting corn from the food supply to produce ethanol.
• Traditional farms with crops AND livestock don’t exist in combination much any more because of these subsidies – so the large farms need fossil fuel based fertilizer to grow crops, instead of using solar energy (sunshine), and natural fertilizer (from livestock).
• Also because of this, now animals are raised on giant feed lots instead of farms, so even more fossil fuels are needed to transport and/or process their waste.
• (Alternatively, Michael Pollan gave an example in Argentina where a farmer was able to do a rotation and raise cattle for 5 years on the land, and then grow crops on that land for 3 years with NO additional fertilizer.)
• Crop rotations impossible in the subsidized, single crop farms, also have proven to dramatically reduce or eliminate the need for pesticides (Apparently, the pests get confused and don’t show up if you alter the crops.)
• We are no longer using solar energy to grow food.  It’s too slow, we prefer the fertilizer. And because of the subsidies, we have farm land sitting unused for months out of the year “wasting solar energy.”
• Food Miles: We raise chickens in the US and ship them to China to be cut up and packaged and then ship them back here to eat them.

Green Jobs

He closed in saying that for all the talk and interest in green jobs, the most sophisticated and important green jobs of the future are farming real food without fossil fuels!

More Info

I certainly have not done justice to the topic. 

If you are interested you can find Michael Pollan’s Open Letter to the Next President on this topic which was recently  published in New York Magazine. 

or listen to his interview on NPR

Great Stuff

I have created a new Category in my blog that I have titled simply “Great Stuff”, and I over time I will put links to a variety of things such as this here.

A fundamental difference between
Management and Leadership is this:

• Making sure the work gets done = Management
• Increasing capacity of your team = Leadership

Team Capacity:

At day 1, your team has a certain capacity.  It can deliver a certain amount of work, at a particular level
of quality, in a measured time frame.

As a manager it is your job to make sure that this work gets delivered on spec, on time and on budget.

But fast forward some amount of time, say 2 years…

At this time if you have been a great Manager, your team will have delivered consistently — but it will still be at the same capacity.

However, if you have been an effective Leader, your team will be able to deliver more work, of higher quality, faster.

Working ON your Business:

Leadership, and increased team capacity, comes from working ON your business vs. working IN your business.

To be an effective leader, of course you still need to make sure that all the work IN your business gets done, (preferably by delegating the management of this work to your managers). 

But you then need to spend YOUR time working ON the business.

Working ON the business looks like:

• Getting better at the stuff you do: more, faster, higher quality, better results, bigger payoff
• Identifying and developing your top performers
• Building trust inside and outside your organization so everything can go faster
• Creating new process and systems to increase effectiveness and efficiency
• Finding strategies to take cost out doing the same things you did last year, to make room for new stuff even if you don’t get more money
• Creating learning agendas for your team around things like, customers, financial realities, decision processes, etc.
• Helping more of your team think like general managers.

For more ideas,  join me for the next member call on Leading vs. Managing or sign up for the podcast.

Leading requires letting go

It is often difficult for leaders to let go of the content work.  It feels like you will lose credibility if you are no longer operating in the details.  But you are shooting yourself in the foot if you don’t let go.

See Addiction to Detail and Building Capacity for more ideas here.

As a Leader it is critical to think more like a General Manager than a subject matter expert, and free up time to work ON your business and increase the capacity of your team over time.  

If you stay too stuck IN your business, in the content, you will miss the opportunity to Lead.

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