Tomicide Solutions, November 2010
How Deming's 14 Points Apply to IT Business Development Departments Part 2
By Tom "Bald Dog" Varjan
Podcast version: MP3 Version
Last month we discussed the first seven of Deming's 14 points, and how they apply to business development. In the first part we looked at the first seven points...
- Constancy Of Purpose For Improvement
- Adopt A New Philosophy
- Cease Dependence On Inspection To Achieve Quality
- End The Practice Of Awarding Business On The Basis Of Price Tag
- Improve Constantly And Forever Every Process For Planning, Production And Service
- Institute Training On The Job
- Adopt And Institute Leadership
Now in the second part we continue with...
8. Drive Out Fear
It is your job, as a manager, to create a conducive and caring environment with the right "energy" in which your people can naturally tap into their highest potential and do their best day in day out.
It is human nature that people want to do their best. It is almost always the working environment and managers' apathy which hold people back from performing at their best.
The average employee attrition in North America is around 21%, and some 65% of those who leave their employers are actually chased away by their incompetent managers. Saying that the average North American manager is incompetent is an understatement of biblical proportions.
There is another problem with fear, and it starts in the brain.
When the conditions are right, we can tap into our highest potential by using both sides of the neocortex in a synergistic manner.
But as soon as conditions change for the worse, the neocortex loses control and the reptilian brain, that is focused on sheer survival, takes control.
And when the reptilian brain is in control, we can't perform complex things like creativity. We can put out fires, but that's all we can do. And putting out fires is a far cry from innovation.
This is why it's vital to create a fear-free work environment.
9. Break Down Barriers Between Staff Areas Or Departments
All business development people, that is, people in marketing, sales and customer service must work as one cohesive team, under the same conditions and must be compensated the same way.
If you have a salary-based marketing and customer service team and a commission-based sales team, then you can say good bye to team work. People will have their own personal agendas to maximise their own personal compensation.
A friend of mine used to work for a company where after each presentation he had to call his sales manager who would close the deal. And salespeople had to hand over 45% of the commission to the sales manager for doing something that the salespeople could have done.
A few months later a press release from one of the disgruntled salespeople brought the sales manager's gravy train to a grinding halt, and barely kept him out of prison.
The CEO took the sales manager to court, and the sales manager was forced to sell his home in order repay all the money that he'd stolen from the salespeople.
People must feel that if the business development team is successful, everyone wins, and everyone gets a fair share of the pie. However, if sales are low, then team members have to tighten their belts.
I find it despicable that in so many IT companies salespeople are treated as royalty but the other people in the client acquisition chain are treated as second-class citizens.
In my experience, where there is a "Win together or lose together" culture, people actually collaborate with each other, as opposed to competing with each other.
Yes, some managers believe that some internal competition is good.
Good for what?
Competition is like a teeter-totter. When internal competition increases, external competition decreases. When people are busy competing with their colleagues, they have no time and energy left to compete with the competition.
And this is why it's vital to eliminate silos.
10. Get Rid Of Slogans, Exhortations And Targets For Zero Defects
Note that nothing worthwhile can be achieved with this retarded "zero tolerance" approach. A soccer team can win in spite of receiving some goals too.
An army can win a battle in spite of losing some men. It is a part of doing business.
There is a great story about this zero tolerance lunacy in Tim Williams' excellent book, "Positioning for Professionals: How Professional Knowledge Firms Can Differentiate Their Way to Success".
A few years back an ad agency called, Cramer-Krasselt, created a great Super Bowl ad for CareerBuilder.
Next morning after the Super Bowl, USA Today ranked all the ads.
When the Cramer-Krasselt's ad didn't become USA Today's "best-liked" ad, CareerBuilder put the ad agency into review with a strong possibility for replacement.
True to the firm's values, Cramer-Krasselt's leadership instantly fired CareerBuilder as a client.
Yes, the agency lost a pisspot of money by firing a major client, but management decided that no client was better than a shitty client.
Cramer-Krasselt also earned all sorts of industry praises for standing up for its values and firing a dumbarse client.
The act also enhanced the firm's reputation so much so, that Porsche hired the agency without a review.
So, instead of exhorting and prodding your people to work harder and aim at zero defects to please all dimwit clients, stand up for your people and if necessary, fire some clients.
Clients come and go, but good people are hard to come by.
Talented people love experimenting, and experimenting includes mistakes. But we have to embrace those mistakes if we want to create something of kick-arse calibre.
And if some clients ask you for perfection for the first time, then get rid of them before your best people start leaving your company.
The other side of zero defects is your systems and processes. Instead of pestering your people for better performance, look into your systems, since the biggest chunk of your problems are system-related.
11. Abolish Numerical Quotas For The Workforce And Numerical Goals For Management
Get rid of all silly sales quotas and number of contacts to be made.
In a cause and effect universe, the numbers are the effects. So, focus on the causes that create the effects.
And what creates the numbers?
People's energy, ambition, enthusiasm, passion, etc. All sorts of "soft" ingredients that most IT companies don't pay attention to.
Numbers are lagging indicators. We see them after the event, and by the time we see them, it's too late to do anything about them.
For instance, if you want to lose weight, don't track your bodyweight because it's a lagging indicator. It tells you where you are and where you've been.
Track what you eat, how much and how well you sleep, how much stress you have and how you exercise (frequency, intensity, etc.) These are causal indicators. As you change them, the effect will change too.
Besides, how do you want to motivate people with numbers that are meaningful to you as a business owner, but not to them?
Motivate them by creating a kick-arse work environment in which they are doing their best on their own volition.
Greatness doesn't come from chasing quotas. Passionate, enthusiastic and driven people do their best because they believe in the company's deep-rooted cause of being in business. So, replace the numbers with leadership and become an exemplar of peak performance. Become worth of being followed. Let leadership rule the land and eliminate "Ivey League" management fads.
12. Eliminate Annual Evaluations
Business development is intangible like practising law or accounting. You can't compensate people with hourly rates as if they were physical labourers. If you use hourly wages, your people will quickly learn how to engage in creative naval-gazing in your office while achieving precisely dick.
Although almost 100 years ago Frederick Winslow Taylor (The Principles of Scientific Management - 1911) successfully destroyed the pride of workmanship and reduced it to repetitive manual labour grunt work and drudgery, lunacy is never too late to unlearn.
Although there is a specific layer of the workforce that loves this no-commitment, apathetic, slacker approach: Union labourers.
The problem lies in annual evaluations. Hourly workers know that as long as they spend enough hours in the building, they've fulfilled their working conditions, and that's all to it.
Then they get the annual bomb of evaluation. Most of the feedback is on actions they've long forgotten about.
So, what can you replace annual evaluations with?
Replace it with instant feedback. Your people actually learn from feedback if it's given to them promptly and specifically.
And the feedback must be actionable. So, instead of saying...
"You should be more courteous on the phone."
You can say...
"Don't answer your phone when you're in an upset mood. Wait until you feel better and then return the call."
This is specific, prompt, hence doable.
13. Institute Vigorous Education Programmes For Everyone
You can't expect people to take courses on a 100% random basis. You have to co-ordinate and synchronise their ongoing education, making certain they are on a path of becoming masters in the skills their positions call for.
Of course, we have to assume here that they actually like what they do and want to become masters at their skills.
When you recruit a receptionist, recruit one who wants to become a world-class receptionist, not one who does it because nothing else is available.
Also make sure, that your people have their educational paths set out and documented in a professional mastery education plan. This is your investment in your future via your people.
Yes, some may leave your company and you may lose your investment, but if your treat them right, they are prone and proud to stay. You can have the best tools and the fastest computers available, but unless your people have all the necessary skills, you are toast.
Look at Formula 1 racing. The cars are basically all the same. Whether a car comes in first or last is up to the driver. Your company is the same. People are the only differentiating factor you can have these days. Everything else comes from the same few suppliers and they are available to each of your competitors.
14. Put Everybody In The Company To Work On The Transformation
Every business is a constant transformation for the better, and everyone must participate in it.
All your people must understand that you're running a business to earn a profit, and people need to do a bit more than practising a trade to earn a wage.
Imagine if you will. You have a bucket of white paint and you drop one drop of black in the bucket. The damage is done. If you are lucky, you can reduce the shade of grey to fairly light, but your paint will never be white again. How many drops of black paint do you have in your organisation? How do you plan to turn your organisation at least light grey again?
Your company is the same. One person can undermine all the other people's efforts.
And how do you get all your people participate?
It starts when you recruit them.
Instead of asking them what they intend to contribute to the company to make the top dogs richer, ask them about their life goals, and then show them how doing well in your company can be a proverbial red carpet to their biggest goals and dreams.
As your people realise that working at your company and doing well there is the way to their goals, you can forget about everything you've ever learnt about human motivation. Just make sure not to demotivate them.
Summary
Well, we've just covered 14 points of transforming your organisation as per Deming's prescription.
I know it can be a pretty large undertaking. When you look at any one of the points, you find they can be somewhat overwhelming.
Yes, it can be a bit scary but let's focus on long-term improvement. Is it worth? Yes.
And if it were so easy, then everyone would do it. The good news is that most companies' operation is far too fear-based, and they wouldn't even consider doing such things.
And that gives you a better chance.
Now the only question is whether or not you're up to it. That's the bee's knees. That's the wasp's nipples. So, what do you say?
Come and let's discuss this newsletter issue on my blog...
Attribution: "This article was written by Tom "Bald Dog" Varjan who helps privately held information technology companies to develop high leverage client acquisition systems and business development teams in order to sell their products and services to premium clients at premium fees and prices. Visit Tom's website at http://www.varjan.com.
