01 December 2012

The Need for Self Renewal

"To me, the greatest tragedy in life is to be ordinary."

--Emilie Griffin, The Reflective Executive

As we come to the end of another challenging year, one thing is evident: Life takes a lot out of people these days. For many, it's the price of living and working (or not working) in a hyper-culture.

More specifically it's a combination of ever-present technology, competing demands, doing your job and a third of someone else's, and the inability to turn off the devices--even when you can. 

Too much going out and not enough coming in is a problem in terms of health, family relationships, and job performance. All reasons for taking this condition seriously.

Failure to periodically refresh the human spirit is not only damaging to the person but has longer-term consequences for society.

Know thyself

An essential part of renewal is coming to terms with who you are.  This is especially true in terms of team-obsessed corporate cultures which tend to diminish the role and necessity of the "individual."

In Self Renewal, author John W. Gardner says, “Good mental health derives from a reasonably objective view of the self—including the acceptance of the self. We run away from ourselves failing to explore and probe the fearful and wonderful world within.” 

He sadly concludes, “The individual who has become a stranger to themselves has lost the capacity for genuine self-renewal.”
Some principles

Gardner, the founder of Common Cause, identifies several principles with qualities that offer realistic optimism about the renewal process, and our part in it:
1. Social and organizational renewal depends ultimately on individuals who have the capacity for renewal.

2. For renewal to occur there needs to be motivation, commitment, conviction, and values—the things that give meaning to life.

3. There will be no renewal for us, society, or a troubled world unless we share a vision of something worth saving.

4. The mind—not the external environment—is the main barrier to renewal.

5. No society is likely to renew itself unless the dominant orientation is to the future. The idea is to move forward with confidence, not blind optimism.

6. In the ever-renewing society, what matters is a system or framework with which continuous innovation, renewal, and rebirth can occur. 
Sources of renewal

Everyone is different but we've found the following to be reliable sources of renewal:
  • Helping those who can't do anything for us in return
  • Timely conversations with persons of great wisdom
  • A new challenge or change of scenery
  • Periods of quietness often with a good book
  • Recreation and rest--the two go together
What is renewing to you?
A self-diagnostic

Taking inventory is a helpful first step. Here are some areas of life upon which to reflect:
· Who are you?   The answer to this question is not a title or position. It has to do with what you deeply believe, care about, and value.

· Where are you now?   In life.  At work. In relationships. Toward achieving your goals.

· Do you know what time it is?   This is to gauge your awareness of reality and the moment in which you live. It has nothing to do with a clock.

· Where should you be going next?   Think opportunity. Maturity. Moving forward or stepping aside--both with a sense of purpose and direction.

· How are you going to get there?   We can't know everything in advance. Start moving and things begin to happen. The right people enter your life. Details become clearer. Stay parked and you'll never know what might have been.
A New Year's resolution

What about including an annual reminder on the calendar that says, "My life is worth renewing."   And once underway renewal has the potential to help bring about more of the same in others.

Restoration, combined with practice and perseverance, makes it possible to move beyond ordinary to extraordinary--which may be the secret of accomplishing great things.


© Bredholt & Co.

01 November 2012

The Role of Presidential Character

"Your character is your fate." 


Did you know it's possible to predict presidential performance in the White House? The same is true for gauging the future performance of a newly minted CEO, but that's another post.  

So how can we know what to expect from the leader of the free world, living at the most famous of all addresses, 1600 Pennsylvania Avenue, in Washington, DC?   

Engaging politically

In his book, The Presidential Character, author James David Barber, says it's essential, even with a strong media filter, to get to know a person wanting to take power. Why should a citizen and voter consider expending this kind of time and energy trying to determine who someone really is?

Whoever wins the election to the highest office in the U.S. will likely affect your life. It's in our best interest, and that of the nation, Barber writes, to engage in the process and hold leaders accountable. Professor Barber says understanding a President should not be as "some abstract embodiment of civic virtue" but as a human being. They bring to the presidential task "their own character, world view, and political style," he notes. 

And the presidency is an office that requires "extraordinary sanity."  

Getting to know them

What should we know about a president?  Professor Barber underscores the following:
  • Their style.  It's the most visible part of the job of being President. Rhetoric, personal relations, and homework. This is not to be confused with stylishness, charisma, or appearance.  
  • Their world view.  This consists of their primary, politically relevant beliefs, particularly their conceptions of social causality, human nature, and the central moral conflicts of the time. How they see the world determines to a great extent what they pay attention to. 
  • Their character.  The word "character" comes from the Greek word for "engraving."  This is the way a president orients him or herself toward life--not for the moment but enduringly, according to Barber's research. Character is how a leader confronts experience and events. At the core of the character is how a person confronts themselves.
Developing potential

What are the stages of personal and professional development for a president?  

For Dr. Barber there are three:
  • Character mainly developed in childhood
  • World view in adolescence
  • Style in early adulthood
The more we reflect on these attributes of presidential character the more we realize they apply not only to heads of state and CEOs but to everyone who holds a position of supervision, management, or leadership in business and nonprofits.

What awaits?

While we stipulate that predicting external events is very difficult to do, behavior is another matter. Research shows that the best predictor of future behavior is frequent past behavior.  
As the years accumulate there's little deviation from established practices in someone's life.

Self-constructed images are easy to create, but with a profusion of up-close technologies, hard to maintain.  

"You can fool all of the people some of the time, and some of the people all of the time, but you can't fool all of the people all of the time."

That plain-spoken wisdom is most often attributed to Abraham Lincoln.

As one who "belongs to the ages," Lincoln embodies the idea that character remains a president's ultimate fate.     


© Bredholt & Co.  

01 October 2012

Innovation at Frito Lay

In the October 20, 2003, issue of Business Week magazine, there's a picture of Steven Reinemund, CEO of PepsiCo.  He is smiling—and for good reason.  In the third quarter of that year, PepsiCo reported excellent numbers.  This was due to a 7% revenue growth from snacks and a 16% sales growth from international markets.

Profits reached $1.07 billion, a 13% gain.  New products contributed substantially to these results.

Fast forward to a different decade.  

Today PepsiCo is led by CEO Indra Nooyi.  She's guiding a much larger company, 2011 net revenue of $66 billion, in a more complex global economy. 

Founded in 1965 through the merger of Pepsi-Cola and Frito-Lay, PepsiCo went on to acquire Tropicana in 1998 and merged with the Quaker Oats Company, including Gatorade, in 2001.   

Times change and so do market positions.  According to Fortune Magazine:

  • Last year between May and September Pepsi stock dropped 15%. Coke stock is up 40% in the same period. 
  • Pepsi often fails to hit its profit targets—something unacceptable to the investment community.
  • In 2011 Pepsi was displaced as the number two soft drink beverage losing out to Diet Coke.  Coca-Cola is No. 1.
Earlier this year Ms. Nooyi, who has a strong interest in nutritional products, outlined a new plan to support the core North American beverages business. She also removed the head of that unit in an attempt to get things moving again.

While there's a lot of back-and-forth in the cola wars perhaps PepsiCo could learn from an internal laboratory that has fueled the growth of its snack business, which a few stock analysts would like to see spun off as a separate company.

Some time ago I was allowed to go on-site and visit innovation in action at Frito-Lay, a unit of PepsiCo.

Our presenter Dwight Riskey, since retired, was a corporate vice president and chief marketing officer. In his own personable way, Riskey took the audience inside the processes of innovation at Frito-Lay. While not all business principles transfer well, there may be something on this short list of takeaways that could be helpful to your organization

All businesses get to a point where growth becomes extremely difficult.

Mr. Riskey made clear that sustained growth is hard to achieve. 

After the 90s dot com bust and the real estate debacle of recent times, we know in retrospect that much of the growth purported by many companies and market sectors was an illusion.  While high-flyers get a lot of media attention for rapid growth, the enterprise worth putting under a microscope is the one that achieves consistent results over extended periods.

Success stories like this are hard to find for two reasons.  First, these businesses tend not to draw attention to themselves.  Second, the examples are few and far between.

Growth at Frito-Lay comes through innovation.

Business leaders are in tension with themselves wanting control, creativity, and growth at the same time. This is a difficult act to pull off.

If it's true new products help PepsiCo increase revenue, how does innovation see the light of day in a large bureaucracy?   What makes the difference when it comes to identifying and implementing innovative ideas? 

It could be credible individuals such as Dwight Riskey and his talented staff.  Or as a best-selling author, Jim Collins would say, the “who.” 

Innovations don’t happen by themselves.  They need help.  There needs to be a champion pushing an idea through a system that is often quite comfortable with itself.  Product innovation is not likely to go anywhere without someone giving permission or protection to try something new. 

It’s important to understand that Riskey, in his day, had access to people who could make decisions and provide resources for innovation.  How did he get this access?  Trust.  He made time to establish solid relationships within PepsiCo.

It would be easy to look at products, advertising, and luck at Frito-Lay to conclude this is the path to profits.   These three categories are important.  However, it’s essential to give credit to the human element of successful improvisation.

It’s hard to be creative inside a mature mindset.

How we see something determines how we’re likely to respond. If your thinking and position are mature then it could limit creativity.  If so, what are ways to tap the imagination and be innovative?  

Have you ever thought of simply moving around the room to look at your idea from another angle? Or enlisting others to help you think about the product or service you’re trying to launch? What about talking to consumers who don't buy from your business and asking them why?

If it’s difficult to be creative using outmoded thinking, it’s impossible to turn on the light in a closed mind.

And that may be the most enduring lesson from our day at Frito Lay.


© Bredholt & Co.

01 September 2012

The Search for Work

"It's not about who you know, it's about who knows you." 

--Jeffrey Gitomer

The first Monday of September is set aside in the United States to celebrate "Labor Day." Countries as diverse as Australia, India, and Norway, all have their own way of honoring the contributions of "labour."  

An official holiday in most places, Labor Day is designed to focus on the achievement of workers and is related to the "eight-hour" movement which proposed giving workers 8 hours of work, 8 hours of recreation, and 8 hours of rest. This effort, which began with the Industrial Revolution in Great Britain in the 19th century, was adopted in the U.S. in 1938 as part of the New Deal's Fair Labor Standards Act.

Unfortunately, too many households are again on the sidelines and will not be participating in this year's parade.

Who's missing?

There are nearly 24 million adults in the U. S. who are either unemployed, marginally attached to the labor force, or employed part-time for economic reasons. (Bureau of Labor Statistics)

When you put these three groups together the underemployment rate is 15%. This is almost 7 points higher than the official 8.3% unemployment rate as of the end of July 2012.

While the private sector created 4.2 million jobs in the past 27 months, the American workforce is down nearly 5 million jobs since the Great Recession started almost five years ago in December of 2007. This most recent recession ended in June 2009 when the National Bureau of Economic Research declared it to be over. Even so, the lingering effects of the severe downturn continue for many households.

Writing in The Wall Street Journal, economist Edward Lazear observed, "What distinguishes this labor market recovery is not that jobs are finally being created but rather the rate of growth is so slow it will be 2016 before we return to pre-recession employment levels."

The country needs about 250,000 to 300,000 net new jobs monthly to begin pushing down the unemployment rate over the longer term.  From December 2011 through February 2012, jobs increased at an average rate of 252,000 per month. During the last three months, that average has fallen to 75,000.

Geography may be destiny

U. S.-based firms that are multinational companies are hiring--overseas. These companies increased their workforces at home by 0.1% in 2010 while expanding internationally by 1.5% according to the Commerce Department.

The entrepreneurial spirit is still around. The Kauffman Foundation reported earlier this year that 320 out of every 100,000 adults in the U. S. started businesses in 2011, one of the highest formation rates in the past 16 years. The problem is that fewer new firms are hiring workers. People now start a business and run it by themselves or with a smaller staff.  

Where are new businesses being created? Nevada, Georgia, Massachusetts, Tennessee, California, Louisiana, and Florida, Kauffman stated. 

The best way to find work

With more than 12 million unemployed going after 4 million openings, how does anyone find the better job?

The way they always have--by word of mouth.

Those looking for a job should think about separating themselves in a crowded field. Not by using the latest fad in resume-writing, but through a credible third-party referral. The importance of someone speaking, making a call, or writing on an applicant's behalf cannot be overstated. This is the way for those unemployed, especially longer-term or older individuals, to gain an advantage.   

There are scores of experienced individuals ready to prove themselves to those looking for good workers with strong character and the right skills.  To make that steady paycheck a reality job seekers should consider increasing their networking (70%) and spending less time on job boards (30%)

With human resources departments understaffed and overworked, it's no wonder some recruiters only spend an average of 6.25 seconds before deciding if the candidate is a potential fit. This disturbing finding is based on research by the job-search site, TheLadders. 

Who you know is not good enough today. It's who knows you that can make a difference.

Coaching can help

Here are some things we've learned over the past four decades in responding to requests for help that may be important to you or someone you know who is in search of work:

For the job seeker:

  • Never tell yourself "no." Don't assume the job you want is out of reach.
  • Remember that part-time jobs and internships can lead to permanent positions.  The goal is to get inside the organization--go from there.
  • Let as many people as possible know you are in the market for a job. An overlooked and highly effective part of the search process is using the Internet to contact family,  friends, and even alumni networks on Linkedin.
For the helper:
  • Never promise a job, only that you will assist in the process.
  • Be careful vouching for someone you don't know well.
  • Make the intervention but let the job seeker do the rest.
The next chapter

Work is not just having a job.  It's also a calling or sense of purpose in one's life. What can you do to help someone achieve those aims? How about offering hope through some form of engagement? A small investment of time can make a big difference in getting the right employer and employee together.

Consider acting on behalf of a friend, neighbor, recent college graduate, or former associate in the coming days. Your efforts could help make it possible for someone currently unemployed to be part of next year's Labor Day celebration.


© Bredholt & Co.  

01 August 2012

The Next Bubble

"In the end, all bubbles pop. That's what bubbles do."  

--Stanley Bing, Fortune Magazine

Supposedly at the peak of the Dutch tulip mania in 1637 certain bulbs sold for more than 10 times the annual income of a skilled craftsman. The reporting of this so-called "bubble" was first popularized in 1841 by British journalist Charles MacKay in his book, Extraordinary Popular Delusions and the Madness of Crowds. 

Recent examinations of MacKay's understanding of the tulip mania question his context of that phenomenon.  Nevertheless, something suddenly happened to change the price/value relationships of tulip bulbs with the consuming public.  (See graphic below)

Source:  Dr. Earl Thompson, UCLA

It's hard to see up close

Whether it's 17th-century tulip bulbs or a 21st-century global housing bust, few buyers or investors seem to have the experience or judgment to sense when bubbles are going to burst.


One reason is that bubbles, by their very nature, are difficult to time. Otherwise more people would be on the upside of downturns. Bubbles are best understood in retrospect.

Another is that leaders tend to be wired as optimists.  Who wants to be labeled a "corporate Cassandra?"  

Also, success can be a deceptive state of mind.  If all one knows is up, it's hard to recognize the beginning of a downward slope. Warning signals go off but they're not strong enough at first to get leadership's attention. Besides, no one relishes being at the helm of an organization in decline.

Having a timely recognition of the significant change in the marketplace or regulatory environment is essential.  Transitions, not necessarily change, provide opportunities, if you know where to look. Miss the moment and a business or nonprofit runs the risk of short-circuiting its future. 

What's the next bubble?  

The cotton industry bubble already burst. A year ago it looked as though many households wouldn't be able to afford towels or clothing due to high cotton prices. Twelve months later raw material prices have fallen sharply (even with a drought) mostly due to strong global output, especially in China.   

Maybe it's the manufacturing of commercial airplanes. The head of a European Aeronautic Defense & Space Co. unit recently issued a statement denying his industry was a bubble about to pop. "There is 'no bubble' in airplane production," said Airbus CEO Fabrice Bergier.

A higher education bubble?

If one Google's the above question the search produces around six million web pages on this topic as of this post.

Dr. Mark Perry at the University of Michigan writes about higher education being an unsustainable course. Even with discounting from the "sticker price" and financial aid packages, student indebtedness hovers around a trillion dollars in the U. S. (See graphic below)

Source:  Dr. Mark Perry, University of Michigan

Glenn Harlan Reynolds, a law professor at the University of Tennessee, says that an education bubble exists for the same reason as the 2007-2009 housing bubble.  

In a recent interview, Professor Reynolds stated, "The government decided that too few people owned homes/went to college, so government money was poured into subsidized and sometimes subprime mortgages/student loans, with the predictable result that housing prices/college tuitions soared and many borrowers went bust."

More attention is being paid to the plight of college students putting higher education on the political agenda of the 2012 American presidential election.

Strong winds are blowing

The driving forces pushing higher education in a different direction include:
  • Rising university overhead
  • Disruptive technologies
  • A 9% unemployment rate for 2011 graduates with a bachelor's degree
  • Reduced middle-class income
  • Reductions in funding from state governments 
A recent study by Bain Consulting and Sterling Partners shows a deterioration of university balance sheets. Their report indicates that the "build, spend and diversify" strategy has over-leveraged a growing number of schools. Long-term debt is increasing at an average rate of about 12% a year with a corresponding growth in interest expense.  

The findings include top-tier schools such as Harvard, Yale, and Duke. However, it's the second-and third-tier institutions that are most vulnerable, says the study. 

The termination of Teresa Sullivan in June this year as president of the University of Virginia, and reinstatement 16 days later, had to do with her supposed lack of vision to address challenges facing UVA. This was the main charge by the lead trustee, Helen Dragas, who reversed course and voted to keep Ms. Williams.

The about-face comes after a threat by Virginia Governor Bob McDonnell to replace all trustees if they couldn't resolve the matter.

Does anyone want to be a university president?

A new kind of semester
  1. Before universities can come to terms with the right course of action there is a need for a "situation assessment."  Out of this analysis would come a presidential voice articulating what the institution is facing and its options.  The process includes an informed and engaged governing board in preparing for the future.
  2. This type of presentation could be shared in a series of interactive conversations with faculty, staff, students, alumni, the foundation board, and major donors. All are designed to take advantage of venues on the calendar.  
  3. The goal is to build awareness and trust while improving and clarifying a plan of action and its implementation.
  4. Immersion in complex matters requires preparation, time, and follow-up. Focus helps avoid a "poverty of attention."   After all, why be distracted by emails and text messages when the school's future may be at stake?   
  5. While there are similarities in the predicaments facing colleges, boilerplate solutions don't seem to be a good option.  Whatever is decided, depending on the assessment and resources, should be tailored to the institution as much as possible.
There's no shortage of ideas as to what might be done--including the merger option. 

A recent article in The Wall Street Journal by columnist David Wessel looks at a "technology/in-class hybrid" teaching model as a way to cap tuition.  A study by Ithaka S + R, a higher education think tank, and Carnegie Mellon University's Online Learning Initiative found that students who took an online course did just as well as those in the conventional course.

Florida is looking into the possibility of launching an all-online university.  Referred to as, "Online U," it would be the first state in the U. S. to go in this direction.  If Online U becomes reality it will be Florida's 13th university.

Reducing operating costs without losing institutional purpose, values, and for many, residential experience, maybe the immediate concerns facing administrators and trustees.  This is especially true among independent colleges which tend to be tuition-driven with small endowments.

Whether talking about administrative efficiencies, a market correction for higher education, or a tuition bubble, perhaps there is something to learn from William Shakespeare. The English poet and playwright wrote in Hamlet, "If it be not now, yet it will come. Readiness is all."


© Bredholt & Co.

01 July 2012

Gresham’s Law of Strategy: Why Bad Advice Drives Out Good Advice

Milo Jones
Visiting Fellow
Pembroke College

Guest Post

Near the end of a seminal essay on strategic surprise, Richard Betts writes:
“The intelligence officer may perform most usefully by not offering the answers sought by authorities, but by offering questions, acting as a Socratic agnostic, nagging decision maker into awareness of the full range of uncertainty, and making authorities’ calculations harder rather than easier.”
I believe that the same should be true for corporate strategy consultants: often their job is to make long-range calculations harder rather than easier.
Why then, is the opposite so often true? In a world in which surprise, disruption, and the unanticipated are rife, why do strategists who promise to make calculations easier rather than harder often succeed?
I think a phenomenon that I call “Gresham’s Law of Strategic Advice” is at work.
E pluribus unum
As my friend Dylan Grice at Société Générale recently reminded us in an issue of Popular Delusions, Gresham’s Law is an economic term that proposes that when two currencies are in circulation side by side, bad currency – that which is debased – tends to drive out sound, pure currency.
Dylan summarized why: when two currencies are in circulation together, one stable and the other falling in value, consumers choose to pay for goods and services with the declining currency while hoarding the stable one.
Over time, only the depreciating currency is left in circulation: sound money “disappears,” and bad money drives out good.
While the law is named for Sir Thomas Gresham, a Tudor banker who witnessed Henry VIII’s debasement of the coinage, the phenomenon was noted as early as the fifth century BCE in Aristophanes’ play The Frogs.
The first strategist
Similarly, let us imagine two strategists have been invited to present to a Board how they would prepare a long-range (say ten-year) corporate strategy. Our first strategist might open by holding up a copy of a business bestseller from a mere five years ago, The World Is Flat.
He could say that when this book came out:
“Skype was a typo, Facebooks were paper, Twitter was a sound bird’s make, 4G was a parking spot, and Linkedin was being part of the inner circle. None of these phenomena are even in the index, and this is a book about how technology is going to change business in the future!
This first strategist stresses that even without technology undergoing rapid change, complexity, uncertainty, and surprise will confront the firm in the next decade.
They always have.
This poor, naïve soul might even point out that in such a world, the firm won’t succeed by applying stale “strategic” frameworks like the BCG Matrix (which dates back to 1968), Porter's Five Forces (created in 1979), or Value Chain Analysis (introduced in 1985).
Anyone who has studied or done business in the last 30 years – including the competition – uses these!
Like it or not, this strategist might say, your firm is likely to face a world in which an integrated, adaptive, and non-predictive strategy is likely to work best. Such a strategy can be formulated and executed consistently, but the outcomes are hard to determine and impossible to quantify.
“At best,” he concludes, “We might use some Monte Carlo simulation tools like @ RISK to specify a range of outcomes.”
This strategy consultant has the intellect, experience, and integrity to admit that no amount of PowerPoint can overcome the inherent complexity, uncertainty, and surprises of the future a decade ahead.

Now the second strategist comes in

This fellow also makes the decade ahead sound dangerous. He also talks about complexity, uncertainty, and surprise.
But then, using the tempo and rhetorical tricks of a revival preacher, he lays out a clever, clear chain of cause and effect-based actions the Board can take that will carry the firm’s profits along a steady Newtonian “trajectory” to new heights.
Risks are not merely acknowledged, they are even quantified (each Risk gets a bubble on a grid whose size and position indicate some combination of likelihood and impact).
This fellow shows the Board hell, but then offers a clear strategic path to corporate salvation: “Use this part of the Value Chain to pull yourself into this part of the Matrix, and by 2023 you’ll be the master of all Five Forces - hallelujah!”
Now the board isn’t dumb.
The second strategist, however, has made their job easy, neat, and tidy. The company is publicly traded, and the CEO has a conference call with analysts tomorrow.
She knows which story she’d rather tell. And there are structural factors at work – big organizations need forecasts, even when they’re known to be wrong.
Kenneth Arrow, the Nobel laureate in Economics, worked as a statistician during the Second World War. When he discovered that the Army’s month-long weather forecasts were worthless, he tried to warn his superiors.
In response, he was told, “The Commanding General is well aware the forecasts are no good. However, he needs them for planning purposes.”
Look into my crystal ball--see what the future holds for you

Given a choice, the analyst or consultant promising illusory certainty is likely to carry the day with most Boards.
If you understand the basic techniques of Cold Reading, you’ll find them used by many strategists and prediction services who offer long-range strategies and forecasts; some substitute the Internet for a crystal ball, but the game is the same.

Dylan quoted Cicero, and so will I: “Human nature being what it is, all men prefer a false promise to a flat refusal.”
That is why I propose “Gresham’s Law of Strategic Advice:”
In a world of complexity, uncertainty, and surprise, you can bet that most of the time, bad strategic advice (predicated on clear predictions) will drive out good (non-predictive) strategic advice.

Reposted with permission.

© Bredholt & Co.

01 June 2012

Part 2: How to Give and Receive Feedback

Guest Post

Dr. Edgar Schein, Professor Emeritus, MIT 

Author of Helping: How to Offer, Give and Receive Help

When we give or receive feedback several things can go wrong because of a fundamental misunderstanding of what feedback is all about in a relationship. We have all been in a situation where someone asked us for feedback, and we offered advice only to discover that this is not what the person wanted.

We have all been in a situation where a friend said “Let me give you some feedback” and we discovered that we either could not really hear what he or she was trying to tell us or we didn’t like what we heard. Yet we firmly believe that relationships and job performance cannot be improved without feedback. And feedback is indeed necessary for any learning to occur.

So why does it sometimes not work? Because we mix up feedback with advice, suggestions, general comments, and various other conversational behaviors. I propose in this short post to give a more precise definition of feedback and some principles of how to give it and, more important, how to receive it.

Feedback Defined

From the point of view of the receiver, feedback is information that tells you whether or not you are on track with respect to your own goals. So if the person telling you something is not connecting with your own goals you will not hear it or pay attention or even be offended.

Point No. 1

If you want useful feedback, you must let the giver know what your goals are so that the information will be relevant. If you are the giver, if you want to get something across to your subordinate, for example, you should find out what he or she is trying to do before giving them information or advice.

Point No. 2

Information will only be useful if it is specific enough for you to be able to apply it. So if you are seeking feedback give the person concrete examples of your goals rather than asking vague questions like “How am I doing?” If you are the giver of feedback try to be specific with behavioral examples.

If you want to tell your subordinate “you need to be more assertive” what you might say: “In contact with your customers I see you backing off; you should stand your ground more.”

Point No. 3

Feedback works best when it is timely when it is given soon after an event when it is clear to both givers and receivers what the goal was and how it might have been accomplished better. That is when the receiver is most likely to be open to hearing what the giver has to say and when concrete examples can be given.

Point No. 4

Finally, feedback works best, i.e. is most helpful, if it is descriptive rather than evaluative.

“You should have been more aggressive when John challenged you at that meeting” might be more helpful if it was stated as “When I saw John challenge you at the meeting, I noticed that you became silent…”

That opens the door for the receiver to explain or absorb the implication. It also focuses on what the giver of feedback observed which might or might not agree with what others observed.

By making a judgment of what you should have done, you are putting yourself into a superior role. By making a descriptive observation, you open the door to learning by exploring why the receiver did what he or she did.

We want feedback to be helpful but it is only helpful if it is solicited, specific, timely, and non-evaluative.

Reposted with permission.


© Bredholt & Co.




01 May 2012

Keeping NASCAR On Track

Do you know your customers or clients?  Or do you just know about them?

When it comes to understanding customers, or fans, maybe something can be learned from NASCAR (National Association for Stock Car Racing), even if you haven't been to the track for a while.

According to news reports, "NASCAR's popularity has stalled." In addition to dealing with phase 3 of a product lifecycle (starting, growing, maturing, declining, and dying),
NASCAR was severely impacted by the recent recession as fans pulled back from spending money to attend its races, including the signature Daytona 500 held each February. 

To try and get out in front of this problem and keep itself on the right track, NASCAR commissioned a $5 million study to find out what's going on inside the minds and lifestyles of a generation it does not know but must have for its future. 

What did NASCAR discover?

In a meeting held in Charlotte, North Carolina in 2011, which included Roger Penske, Jack Roush, and other racing team owners, NASCAR chairman, Brian France, presented a wake-up call, not just bullet points.  The comprehensive research found that:
  • Drivers, the lifeblood of the sport, were too predictable
  • Race teams and NASCAR were slow to embrace social media
  • Track owners were not doing enough to make attending races easier
  • Not enough was being done to attract Hispanics and urban youths to offset the decline of older fans
A break in the pattern

As commentator Frank Deford, wrote, "A whole cohort of our young boys--and girls--have been growing up without any interest in messing around--tinkering--with cars."   What NASCAR discovered, Deford added, is that "nobody wants to do that anymore."

It's hard to believe young adults would give up their parents' and grandparents' historic love affair with the automobile in exchange for the latest mobile phone app, yet evidently, that is the case.

"Things that can't go on forever don't," said the late Nobel Laureate, Herbert Stein.  Does this include having a dependable customer base? 


Out of this year-long exhaustive research, which included 64 hours of focus groups, and observing how fans navigate racetracks, came a decision to hire Kim Brink from General Motors as head of the NASCAR brand and consumer marketing group. Brink was part of a team involved in the turnaround of Chevrolet and Cadillac, increasing retail sales in the U.S. by 40% over the past several years.  

NASCAR is already acting on a five-year strategic plan from the Taylor Strategy study focusing on:
  1. Growing the youth and Hispanic fan base
  2. Reaching the next generation of NASCAR fans
  3. Developing a wide-reaching digital and social media strategy
  4. Building driver star power
  5. Improving the at-track experience for fans
Maybe establishing customer loyalty is implied in this list but should it be explicit? 

What about your business?

NASCAR does not face an uncertain future alone. 

Changing demographics, aging customers, dissimilar values, poor service, and technology are upending businesses as diverse as retailing, dining, medical, legal, and financial services.

How people make their purchases is also part of the drama.  Just ask Best Buy whose big box design is being undone by the Internet.

While the 55+ crowd is financially worth pursuing, isn't this the time to be thinking about new market opportunities? 

Where to begin?

The "skein of thread" or clue for working through a digital labyrinth is first knowing your core values which provide an inner sense of direction. What is it you believe? What is it you stand for? What is it you're all about? 

In assessing this new external environment, begin with the marketplace, not technology.  Here are some questions from the Peter Drucker Assessment Tool to help get you started. It was Drucker who once defined the essence of marketing as "knowing what is valuable to the consumer:"

  • Who is our customer?

  • How will our customers change?

  • What does the customer value?

  • What knowledge do we need to gain from our customers?

  • How will I participate in gaining this knowledge?

  • How do we go about this process?

  • Something to think about 

    In a highly competitive marketplace, how does a company or nonprofit find new households whose values are a close match with theirs--without a seven-figure NASCAR research
    budget to inform the process? 

    To stay on the right track in an electronic world, how will new customers find you?   


    (C) Bredholt & Co. 

    01 April 2012

    Becoming An Inquiring Leader

    Those who succeed in top management do so in part by knowing how to ask the right questions. This discipline is often associated with strategy development, problem-solving, product launches, and competitive analysis.  

    Asking probing questions, with purpose, is a habit acquired through practice, and the formulation of questions is more art than science.  

    Getting started

    Inquiries begin with a two-part question:  What do we need to know, and why? 

    A basis for engaging in this form of communication comes from a curious mind--which may explain why so few initiate these types of discussions.  It's easier to "tell" than to "ask," even though at certain times telling or explaining a point of view is the appropriate thing to do.

    In going through our library recently, I came across the book, Leadership Is An Art, by Max DePree.  Mr. DePree, a son of the founder of the office furniture company, Herman Miller, D. J. DePree, is also a former CEO of the company and served as a board member until 1995.  

    I heard Mr. DePree speak at a conference.  His skillful approach to mentoring direct reports, and teaching them how to learn, grow, and change is simple yet profound. What's his secret?  Some of it has to do with asking thoughtful questions.

    His best-selling book is the source of the oft-quoted line, "The first responsibility of a leader is to define reality." To complete the thought, here is the rest of DePree's thesis: "The last is to say thank you. The leader must become a servant and debtor between the two. That sums up the progress of an artful leader."

    Like most who find their way to the top, Max DePree, discovered early on that communication was essential to the task of leadership. Toward the end of his signature book, DePree underscores the idea of two-way communication by listing questions asked of Herman Miller's senior managers. 

    I took the liberty of clustering his "need to know" in the following outline:

    • Who are you?  How do you see yourself personally, professionally, and organizationally?
    • What do you want to do (to be)? What are you planning to do about it?
    • What have you abandoned?
    • What significant areas are there in the company where you feel you can make a difference but cannot get a hearing?
    • Do you have any feelings of failure in any particular area?
    • What will you do in the coming year to develop your three highest-potential persons (and who are they)?
    • In the past year, what, from the perspective of integrity, most affected you personally, professionally, and organizationally?
    • What are a few of the things that you expect most and need most from the CEO?
    • What two things should we do to work toward becoming a great company?
    • What significant areas are there in the company where you feel you can make a difference but cannot get a hearing?
    • Does Herman Miller (insert your company) need you?
    • Do you need Herman Miller (insert your company)?
    • If you were "in my shoes (CEO)," what would you focus on?
    • What are three signals of impending entropy (disorder in the system) you see at Herman Miller?  What are you doing about it?
    • What are three examples of budding synergy in your area and how can we capitalize on them?
    Is inquiry a part of your team-building efforts?  Do you know your people and what they're thinking?

    Perhaps we could add to the Ancient Greek aphorism, "know thyself," the importance of making time to know others as Max DePree did during his successful career.  

    After all, results depend on who your associates are as well as what they do.  


    © Bredholt & Co.  

    01 March 2012

    The Feedback Dilemma

    "Planes are safer when the least experienced pilot is flying because it means the second pilot isn't going to be afraid to speak up."   

    --Malcolm Gladwell in Outliers

    Does your organization emphasize the importance of clear and open communication (which includes listening) as much as it does being on a "team?" Probably not. And yet clarity in ideas, conversations, and interactions are sources of oxygen allowing systems to breathe appropriately--which is a sign of a healthy team. 

    Problems at the office or factory are often rooted in a lack of mutual understanding about expectations, goals, deadlines, procedures, and who the customer really is. A readily available tool of management to address this situation is the proper use of feedback--or "feedforward" as our friend, Marshall Goldsmith, likes to say.  

    How is the feedback used?

    Some examples:
    • Employees need to know what their supervisors are thinking in terms of job performance, and not just during formal reviews
    • Management is helped by getting real-time information from those around them--even if it's something they don't want to hear
    • Workers require candid conversations from colleagues for instruction, to gauge how things are going, and to achieve mutual goals
    • Businesses should hear from customers in order to know how they are doing, what not to change and where improvements should be made
    Holding Back

    Why are associates reluctant to explain how they feel about something? It could be from past experience. Speaking up may have been taken the wrong way so employees learn to be silent. Unfortunately, this means valuable information remains hidden from those who might need it most.  

    Thus the dilemma.

    According to the organizational psychologist, Dr. Michael Woodward, two factors that influence how individuals communicate in group settings, such as staff meetings, are "personality and position." 

    Thoughts are eventually shared because employees have to talk--often with a trusted peer or spouse. Some of the more useful internal focus groups take place at lunch.

    Studies also show the hesitancy to candidly convey how we feel has cultural roots as described in the Outliers chapter about air safety and the "theory of ethnicity." 

    Improvements in Aviation

    Recent news stories confirm a reversal of deadly crashes in the airline industry over the past several years.  The conclusion:  Air travel in the U.S., at least, has never been safer. It has been a decade since passengers died in a crash involving more than 100 people.

    This is a dramatic turnaround from the 1990s when, as someone observed, "planes were falling out of the sky."

    One of several reasons for this improvement in safety has to do with pilot training. The history of aviation has shown a strong, if not a dictatorial role for the captain, causing co-pilots to not speak when necessary or speak but not be heard--often with deadly results.  An example of this is the 1982 Air Florida crash in Washington, D. C.

    Captains are now trained to solicit input from all members of the flight crew.

    For their own health and safety, businesses and nonprofits could learn something about improving the free flow of information from changes in aviation practices. 

    A Definition Of Terms

    How do we begin improving this essential part of our professional relationships? In addition to cultural issues, we can start by understanding the different kinds of feedback and improving the quality of our exchanges. 

    In his practical book, Getting It Done (Harper), author Roger Fisher offers enlightenment on a largely undefined process. In addition to aviation-type "warnings" mentioned above, corporate feedback, says Fisher, has three key parts:

    To encourage and improve morale. This is an expression of gratitude or approval of another’s effort. It is an expression of emotion, designed to meet an emotional need.
    To help individuals improve their skills. Advice consists of suggestions about a particular behavior that should be repeated or changed. It focuses on the performance, rather than on judging the person.
    This relates to making wise decisions about personnel and their assignments. An effective way to do this is by ranking the subject’s performance in relation to that of others or against an explicit or implicit set of standards.

    Why does feedback go awry:
    • We fail to understand there are different types of feedback
    • We co-mingle the types (doing two things at one time—sending mixed signals)
    • We use one type (appreciation) when we should have used another (evaluation)
    Think for a moment about the last time you gave or received feedback. Was it clear?   Appropriate for the circumstances? Or did you get (or give) appreciation when you should have received (or given) advice?   

    In a future post, we will share "tips" on giving feedback from the book, Helping, by Dr. Edgar Schein.

    Properly used, feedback can be a positive force for your organization. 


    (C) Bredholt & Co.