Today’s post is by John Spence – author of Awesomely Simple – Essential Business Strategies for Turning Ideas into Action. He’s going to take hundreds of thousands of pages of information and boil it down into a simple formula for business success. Seriously. Here’s John…
As global markets become increasingly more competitive and financial turmoil worldwide continues to put pressure on nearly every type of business, I have had more and more organizations approach me to assist them in finding ways to be more competitive and successful in today’s economy. Although there is absolutely no “one size fits all” solution, to me the absolute most powerful strategy is to make sure that the core elements of your business are running so incredibly well that your customers absolutely love doing business with you and are eager to tell their friends, family and colleagues about your products and services. All the marketing tricks, ads and social media efforts in the world simply cannot overcome poor quality or lackluster customer service.
That is why for the past 19 years my career has focused exclusively on studying the fundamental elements of business success. Traveling worldwide at upwards of 200 days a year, I have worked shoulder to shoulder with some of the best (and worst) business leaders of our generation. I’ve also maintained a strict regimen of reading a minimum of 100 business books a year since 1989.
In preparation for writing my book Awesomely Simple, I compiled all of my research and reading down to a single page that I called my “Strategy Map.” This single piece of paper represented more than 175,000 pages of reading on business excellence and an additional 5,000 pages of interview notes and survey results from my work as a consultant and trainer. I then took all of that information and tried to uncover the pattern… the formula for business success. Well, here is what I came up with:
(T+C+ECF) x DE = Business Success
Let me take you step-by-step through the elements of this equation.
You need the brightest, most talented, values-based people you can possibly get on your team. Here is the truth: “The success of your organization is directly proportional to the quality of the talent you can attract and keep in your organization.” I recently had the great honor of having lunch with one of America’s wealthiest and most successful entrepreneurs, a man who started with nothing and built it into a multi-billion-dollar company. When I asked him what the single most important piece of business advice he could give me was, he smiled and said, “It’s all about people, people, people. You can kid yourself about a lot of things in your business, but at the end of the day it’s always going to come down to the quality of your people.” A blinding flash of the obvious perhaps, but too few companies take this sage advice to heart and make the acquisition, growth and care of absolutely superior talent a true strategic objective.
Many people used to feel that “culture” was sort of a touchy-feely issue, a “nice-to-have” but not a strategic issue. Nothing could be further from the truth. If the success of your business is truly tied to the quality of the talent you can attract your team… culture is key because highly talented people want to work with other great people, doing cool and meaningful work at a company that treats them with respect. Trust me; you cannot have a winning company without a winning culture. So, what are the elements of a winning culture? Here are what I believe are the top three (of a fairly long list):
Safety: People want a safe working environment where their ideas and values are safe and where they feel that their career is safe as long as they deliver the required results.
Belongingness: Everyone wants to feel like they are part of something bigger then themselves, part of a team, a family, a tribe… where people truly care about them and are glad they are in the group.
Appreciation: I cannot possibly overstate how important it is to show people that you genuinely appreciate them and the work they do. A major key to success is creating a culture where you focus on catching people doing something right and thank them honestly for it.
These are three of the strongest human needs and flooding your organization with these elements will have a profound impact on employee satisfaction and productivity.
Extreme Customer Focus
Let’s face it, about the only sustainable competitive differentiators left to most businesses today are the quality of your people and the quality of your customer service. Competitors can copy your products, they can beat your price (there’s always someone willing to go out of business faster than you), they can copy your distribution channels, they can reverse engineer your technology, they can put a location directly across the street… they can copy just about everything but who you have on your team and how your team treats the customer. Therefore, building a culture of extreme customer focus, where your organization “owns the voice of the customer,” is one of the surest ways to control the marketplace.
Lastly, you combine the first three elements: Talent + Culture + Extreme Customer Focus… and then you work like crazy to get your entire team to execute with discipline. For the past seven years I have taught a class on strategic thinking at the Wharton school of business at the University of Pennsylvania. Each year I have about 140 senior executives attend my class, and every year I asked the same question: “What percentage of companies that know how to succeed in the marketplace, that have a great strategic plan… effectively execute their plan?”
Year after year the answer is the same: 10 to 15%. It does you no good whatsoever to hire great people, create an amazing culture, and do a superior job of listening to your customers – if you cannot instill a high level of disciplined execution so that your great ideas are turned into effective action. Therefore it is critical to create the systems and processes necessary to ensure that people clearly understand what their roles and responsibilities are, and specifically what they will be held accountable for.
Because (and I LOVE this quote) Ambiguity Breeds Mediocrity, the final step in creating a culture of disciplined execution is to broadly communicate progress on all essential goals and objectives so that everyone in the organization knows exactly how things are moving forward and what they can do to keep everything on track.
So there you have it, 19 years and nearly 200,000 pages of business information boiled down to a clear formula for business excellence. I know that this formula does not cover everything needed to build a highly successful company, but it is my firm belief that if you take this equation and follow it with vigor and commitment, you will definitely see a strong positive impact on your business.
John Spence is the author of Awesomely Simple – Essential Business Strategies for Turning Ideas into Action. He is an award-wining professional speaker and corporate trainer, and has twice been recognized as one of the Top 100 Business Thought Leaders in America.