Name three dominant airlines.

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.

Thanks again

Sean McPheat
Managing Director
MTD Management Course

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Most people you meet will have a different way of seeing things to you. How they make decisions, solve problems, assimilate information, etc., will be different to you becasue they will have preferences that don’t match yours. When you recognise these different thinking patterns, you can improve communication, management, leadership and decision-making to improve all aspects of interpersonal skills.

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
Managing Director
MTD Management Course

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Regardless of how long you’re in management, there will come a time when you will have to face the prospect of offering some kind of discipline to a staff member. Although thought of as being punishment, discipline should be seen as a way of convincing someone there are higher standards to attain, and you are offering the individual the chance to improve.

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
Managing Director
MTD Management Course

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One of the most interesting models of team effectiveness was developed by Patrick Lencioni (2005). According to him, all teams have the potential to be dysfunctional. To improve the functioning of a team, it is critical to understand the type and level of dysfunction. Similar to Maslow’s Hierarchy of Needs Theory (1954), there are five levels and each must be completed to move on to the next one.

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
Managing Director
MTD Management Course

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Victor Vroom’s expectancy theory of motivation explains how people make decisions regarding various behavioral alternatives. Expectancy theory offers the following propositions:

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
MTD Management Course

Click below for a:
FREE email course “Improve Your Management Skills”

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