The model explains performance gaps and identifies improvement directions. I’ve used it a number of times to determine the future direction of my company, and it consists of a few fundamental elements:

• Leadership and consistency of purpose
• Management by processes and facts
• Employee development and involvement
• Continuous learning and improvement
• Partnership development
• Public Responsibility

Results not only reflect how well an organisation is performing, but also measure a company’s performance from perspectives like customer focus and social results.

What does it require from a management and leadership point of view? Well, here’s a list of management requirements:

• Develop mission, vision and values
• Be role models of excellence
• Be involved in developing, implementing and improving systems
• Be involved with customers and partners
• Recognise, support, coach and motivate people within the business
• Identify, develop and sustain people’s competencies
• Involve and empower teams
• Reward, recognise and care for individuals

There are many other ways that the model recognises the professionalism of a company, and I would suggest you take a look at how your position could benefit from looking at this recognised tool for development. The EFQM Excellence Model provides core elements for the effective analysis, assessment, structure, improvement and management of a business, and I would recommend you find out more about it to determine how your strategies could be improved in the future.

Thanks again

Sean

Sean McPheat
Managing Director
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Mintzberg argued that it’s really hard to get strategy right. To help us think about it in more depth, he developed his 5 Ps of Strategy – five different definitions of (or approaches to) developing strategy.

Each of the 5 Ps is a different approach to strategy. They are:

1. Plan.
2. Ploy.
3. Pattern.
4. Position.
5. Perspective.

1. Strategy as a Plan

Planning is something that many managers are happy with, and it’s something that comes naturally to us. As such, this is the default, automatic approach that we adopt – brainstorming options and planning how to deliver them.

This is fine, and planning is an essential part of the strategy formulation process. The problem with planning, however, is that it’s not enough on its own. This is where the other four Ps come into play.

2. Strategy as a Ploy

Mintzberg says that getting the better of competitors, by plotting to disrupt, dissuade, discourage, or otherwise influence them, can be part of a strategy. This is where strategy can be a ploy, as well as a plan.

For example, a grocery chain might threaten to expand a store, so that a competitor doesn’t move into the same area; or a telecommunications company might buy up patents that a competitor could potentially use to launch a rival product.

3. Strategy as a Pattern

Strategic plans and ploys are both deliberate exercises, and a consistent and successful way of doing business can develop into a strategy.

For instance, imagine a manager who makes decisions that further enhance an already highly responsive customer support process. Despite not deliberately choosing to build a strategic advantage, his pattern of actions nevertheless creates one.

4. Strategy as Position

“Position” is another way to define strategy – that is, how you decide to position yourself in the marketplace. In this way, strategy helps you explore the fit between your organisation and your environment, and it helps you develop an advantage over the competition

For example, your strategy might include developing a niche product to avoid competition, or choosing to position yourself amongst a variety of competitors, while looking for ways to differentiate your services.

5. Strategy as Perspective

The choices an organization makes about its strategy rely heavily on its culture – just as patterns of behavior can emerge as strategy, patterns of thinking will shape an organisation’s perspective, and the things that it is able to do well.

For instance, an organisation that encourages risk-taking and innovation from employees might focus on coming up with innovative products as the main thrust behind its strategy. By contrast, an organization that emphasizes the reliable processing of data may follow a strategy of offering these services to other organisations under outsourcing arrangements.

Using the 5 Ps

Instead of trying to use the 5 Ps as a process to follow while developing strategy, think of them as a variety of viewpoints that you should consider while developing a robust and successful strategy.

As such, there are three points in the strategic planning process where it’s particularly helpful to use the 5 Ps:

1. When you’re gathering information and conducting the analysis needed for strategy development, as a way of ensuring that you’ve considered everything relevant.
2. When you’ve come up with initial ideas, as a way of testing that that they’re realistic, practical and robust.
3. As a final check on the strategy that you’ve developed, to flush out inconsistencies and things that may not have been fully considered.

Using Mintzberg’s 5 Ps at these points will highlight problems that would otherwise undermine the implementation of your strategy.

After all, it’s much better to identify these problems at the planning stage than it is to find out about them after you’ve spent time and money implementing a plan that was flawed from the start.

Thanks again

Sean

Sean McPheat
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Most systems actually encourage this because people are told that if they work hard, do their job efficiently and get results, they will be promoted. But, as Peter himself says, “The problem is that when you find something you can’t do very well, that is where you stay, bungling your job, frustrating your colleagues and eroding the effectiveness of the organisation.”

This reflects a fundamental problem when assessing people’s potential. If someone is good at their current job, does this naturally predict success in the next one? Maybe, maybe not. Technical competence does not necessarily equate to managerial competence, for example.

How can you beat the Peter Principle?

With difficulty, but with perseverance. You need to match the person’s capabilities with the demands of the job. Your starting point should be an analysis of the skills required to achieve success in the new role.

Remember the acronym ‘MATCH’ and you give yourself a chance to win:

Managerial: The ability to make things happen, lead people, inspire them, motivate, build a team, maintain morale, co-ordinate, direct effort, use resources and control events. Does the person have the capacity to do all these?

Analytical: Directing problems and coming up with the right conclusions. Can they achieve this?

Technical/professional: The ability to use other people’s knowledge professionally as well as having the competence to do the job themselves. Are they able to do this?

Communications: The ability to put a message across in a way that is clear, understandable, brief, accurate and motivational. Do they have this capability?

Human Resource Management: The ability to get the best out of others and tap into their potential. Do they have the ability to get these results?

These five criteria should act as a sounding board when you are assessing the capability of someone to be promoted. Ask yourself what indications of capability do they show in their current role that will be utilised in the future role. If not, what weaknesses could be addressed so they have the capacity to carry out the future role?

After the promotion, monitor the progress of the individual so you keep tabs on how they are progressing and assist in their development.

So, although the Peter Principle is alive and well in many organisations, you have the ability to create the foundations to overcome it, if you use the ‘match’ acronym and identify the assistance you can give someone before they reach their level of incompetence.

Thanks again

Sean

Sean McPheat
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Among other things, they mentioned the following:

* If the manager allows people to tap into a range of skills and capabilities that they have, they are going to be much more motivated than if they only used a narrow range of  skills.

* If the manager gives people the opportunity to work on a whole taks from start to finish, they tend to be more motivated than if they only work on a small piece of it.

* If people understand the benefit of a task and the benefit to the organisation as a whole, they are motivated to see the impact their actions will have.

* If people are given some sense of autonomy, if they are given broad objectives and allowed to choose their own path to get there, they tend to have higher intrinsic motivation.

* If the manager gives clear and immediate feedback, people know they’ve actually met the manager’s expectations and feel motivated in continuing to do so.

This isn’t rocket science, but gives a good insight into the kind of things managers can do to enhance the abilities of their people and identifies why sometimes people don’t bring their motivations to the party. People always thrive in challenging, interesting and meaningful environments, so seek out those opportunities to help your people grow.

Thanks again

Sean

Sean McPheat
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The idea allows for different modes of thinking, allowing a problem to be seen from different perspectives. It encourages you to choose a deliberate focus during a discussion that suits the needs of the discussion.

The model can be used in meetings, workshops or brainstorming activities, and can also be used by individuals. Each different coloured hat refers to a different mode of thinking. You can ask all people in a group to ‘wear the same coloured hat’ or you can encourage different people to ‘wear different colours’.

De Bono distinguishes the colours as follows:

White Hat: Factual – With this hat, you focus on specific, available data. You analyse the information and see what can be learned from it. You identify the information you have and what further information you need

Red Hat: Emotional – With this hat, you consider the situation with intuition and emotion. How do you respond emotionally to the situation? How would others respond?

Black Hat: Critical – With the black hat, you see the downside of the situation, cautious and defensive. You highlight the weak points, the downsides, the pitfalls, reasons why it might not work

Yellow Hat: Positive – With this hat, you think positively, highlighting an optimistic point of view, looking at the advantages, being opportunistic, watching for the benefits

Green Hat: Creative – Here you create solutions to problems with a free way of thinking. You look for possibilities, growth, new ideas, new initiatives

Blue Hat: Process control – Here you take control of the thinking process of the group. Normally worn by the meeting chairperson, the blue had manages communication, focuses on the main points, creates conclusions, summarises and deals with action points

You can see that, when used creatively, it can be a very useful model to encourage different thinking styles whenever you’re stuck for ideas or find yourselves always going down one particular line of thinking.

If you feel the concept of coloured hats wouldn’t go down well with your team, simply use them in your own mind, and drive the discussions down the specific avenues of gaining facts, using intuition, creating new ideas, seeing the benefits and disadvantages of certain ideas and keeping control of the development of ideas. That way, you have all issues out in the open with the chances of missing key information greatly reduced.

Thanks again

Sean

Sean McPheat
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Now, name three dominant food-chains.

And finally, three dominant supermarket chains.

I’m sure you found that exercise easy. And it’s not surprising, because there is a theory that explains how, in every industry, three major players emerge to dominate the market, and the balance is made up by specialist niche players or companies that stand out in different ways.

It’s called The Rule of Three, developed by Professors Jagdish Sheth and Rajendra Sisodia. What their research showed was that three market leaders emerge, surrounded by other smaller niche brands or companies that create a different marketing direction for others to follow, away from the mainstream.

It helps companies to identify whether they want to become part of the ‘big three’, and is useful for strategic and competitive moves carried out by businesses. Companies can determine where they stand in respects to competitors.

There are some limitations to the rule, and in Europe it may be better to consider it appropriately as the Rule of Four, as there are several industries where the competition laws allow more bigger players to take part than in the USA, but it’s an interesting analysis for industries and competitors to think through if they are considering changes and expensions in the way they work.

This is expecially true in developing markets. And, of course, the web has created a different marketing culture. Think about books (Amazon), online auctions (Ebay), search engines (Google). These are prime examples of how single categories can be dominated by one company, allowing others to occupy niche positions.

And other industries are dominated by just two companies (Pepsi and Coke, Duracel and Energiser, Visa and Mastercard are just some examples), so there may be room for other companies there, too.

Who knows what the future will bring in terms of the competition to these dominating businesses in their specific industries? It may be that the Rule of Three (or Four) only applies in a long-term frame. But it’s an interesting concept to consider as the markets change through greater competition from the Far-East, Brazil and Russia, and as the US dominance is threatened in other areas of the world.

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Ned Herrmann has designed a technique called ‘whole-brain modelling’ in which he describes the brain as an interconnected set of mental processing modes, or thinking styles. Because these styles originate in different parts of the brain, he discusses how we all differ in the way we think things through.

The four styles, according to Herrmann, are:

Logical thinking: Analysis, technical, mathematical, problem-solving
Organiser: Controlled, planned, conservative, organised, administrative
Communicator: Emotional, interpersonal, musical, the talker
Visionary: Imaginative, conceptual, synthesising, holistic, integrative

Herrmann suggestes our thinking preferences can be different to our skills or bahaviour at work, depending on the situation. But if we have to think differently to our preferences, even if our skills are excellent, we may find the situation more uncomfortable and time-consuming. Our energies are best suited by thinking through situations in the way we prefer to, rather than being forced to determine the answer in a way that doesn’t suit us.

Our dominant thinking style will be one of the four categories listed above. These preferences establish our interests, help us to develop competencies and actually influences our career choices and the way that we work.

This probably explains why you sometimes find it difficult to think in a different way. We’re often asked to ‘think outside the box’ by our bosses, bit if your dominant thinking style isn’t directed that way (e.g. if you are a logical thinker, good at analysing things and identifying facts) you may find it hard to be intuitive and holistic in your thinking.

This model helps explain what our strengths are and how we can identify others’ skills and talents. You can get more information by reading The Whole Brain Business Book, by Ned Herrmann.

Thanks again

Sean

Sean McPheat
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While progressive discipline is generally the most effective method of dealing with discipline, it must be practiced within a larger framework. To increase the likelihood of positively influencing employee performance and protecting against legal action, keep Douglas McGregor’s “hot stove rule” in mind:

Foreseeable; Just as the flames or red coils provide warning that you will be burned by touching the stove, your employees should know in advance that poor conduct or performance will result in specific, pre-determined consequences.

Immediate; When you touch a hot stove, you know instantaneously that you have done something wrong. Similarly, an employee should be quickly told if he or she is failing to meet expectations.

Impersonal ; The fact that you are burned is a function of the stove, not who you are. Likewise, the discipline applied in a particular situation should reflect the offence, not the person who committed it.

Consistent ; Regardless of who touches a hot stove, the result will be the same each and every time. This is also true of discipline; it should not be applied randomly or by chance, nor should it differ, for the same offence, from one person to the next.

By sticking to your organisation’s written disciplinary policy, you will help your team to work well and effectively, and may also improve your company’s defence against law-suits.

So, see the disciplinary procedure as McGregor saw it, and you’ll see the way forward with staff rather than having to play the school-master.

Thanks again

Sean

Sean McPheat
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Here are five potential dysfunctions of a team in Lencioni’s model:

Dysfunction #1: Absence of Trust
This outcome occurs when team members are reluctant to be vulnerable with one another and are unwilling to admit their mistakes, weaknesses, or need for help. Without a certain comfort level among team members, a foundation of trust is not possible.

Dysfunction #2: Fear of Conflict
Teams that are lacking trust are incapable of engaging in unfiltered, passionate debate about key issues. It creates situations where team conflict can easily turn into veiled discussions and back channel comments. In a work setting where team members do not openly air their opinions, inferior decisions result.

Dysfunction #3: Lack of Commitment
Without conflict, it is difficult for team members to commit to decisions, fostering an environment where ambiguity prevails. Lack of direction and commitment can make employees, particularly star employees, disgruntled and disenfranchised.

Dysfunction #4: Avoidance of Accountability
When teams do not commit to a clear plan of action, even the most focused and driven individuals are hesitant to call their peers on actions and behaviours that may seem counterproductive to the overall good of the team.

Dysfunction #5: Inattention to Results
Team members naturally tend to put their own needs (e.g., ego, career development, recognition, and so on) ahead of the collective goals of the team when individuals are not held accountable. If a team has lost sight of the need for achievement, the business ultimately suffers.

When the team are working in harmony, these dysfunctions cease to cause problems. Lencioni’s model highlights the results when the team lack trust, and this should be the area you concentrate on the most.

Thanks again

Sean

Sean McPheat
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1. When deciding among behavioral options, individuals select the option with the greatest motivation forces.
2. The motivational force for a behavior, action, or task is a function of three distinct perceptions: Expectancy, Instrumentality, and Value. The motivational force is the product of the three perceptions:

so, Motivation = Expectancy x Reward x Value

1. Expectancy probability is the expectancy that a person’s effort will lead to the desired performance and is based on past experience, self-confidence, and the perceived difficulty of the performance goal. Example: If I work harder than everyone else in the company, will I produce more?

2. Reward is based on the perceived performance-reward relationship. This is the belief that if someone does meet performance expectations, he or she will receive a greater reward. Example: If I produce more than anyone else in the sales force, will I get a bigger raise or a faster promotion?

3. Value refers to the value the individual personally places on the rewards. This is a function of his or her needs, goals, and values. Example: Do I want a bigger raise? Is it worth the extra effort? Do I want a promotion?

The combination of these three will determine the effort that the employee will put in. If the employee doesn’t actually value the reward they are offered, the effort will correspondingly be less. Similarly, if the person doesn’t think that the effort will attract the reward, the motivation will be low as well.

It’s only when all three are in alignment that the effort will be made to achieve the final reward.

Thanks again

Sean

Sean McPheat
Managing Director
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