That’s the catchy title of a 2007 book by Dr. Marshall Goldsmith, an award winning author, business thought leader, professor and executive coach who heads the Marshall Goldsmith Group of consultants (mission: to help successful leaders get even better) and maintains the free Marshall Goldsmith Library. He has written and/or edited 35 books, mostly about leadership, learning, change and personal improvement. I found a copy of this book at a library sale recently, and I recommend it, but that’s just background.
Some weeks earlier, I had agreed to help kick off a senior management meeting at a company run by some former colleagues of mine who had escaped from an insurance company claims environment nearly 20 years earlier to start up their own specialty claims business. Over the years their business flourished, expanding in scope and size to the point where the founders knew it was time to pull together their management team and discuss what needed to be done to move the company to the next level. They wanted me to help set the proper tone for their meeting by talking about change challenges and reviewing some of the things successful companies do, and don’t do.
Since I was heading off on vacation, I thought I would spend some of my leisure time preparing by re-reading my favorite articles about successful companies, and by reviewing some of the many notebooks I had filled over the years with on-topic material. I also brought along Goldsmith’s book, and read it through one rainy day. If you haven’t read it, I think I can give a quick overview without spoiling it for you. The theme is that most of us have bad habits, and even if those bad habits somehow helped to get us to a certain level, they might just prevent us from moving to or being successful at the next level. When I read through the habits (like delusional thinking, denial, overconfidence, failing to listen, dismissing feedback, failing to plan, blaming failures on external, uncontrollable factors, and allowing distractions to interfere with achieving objectives) I started feeling a bit uneasy, even embarrassed, because at one time or another in my career I knew I was probably guilty of all of them.
But then it hit me—Goldsmith was writing about personal, individual habits, but companies are collections of people so they have their own habits and ways of doing things (their culture.) Entrepreneurs imprint their own habits on their company, so they directly influence their company’s success through their imagination and insights, their willingness to take chances, their resiliency, their commitment, and the unique set of skills, behaviors and attitudes they bring to the effort. Through scrambling, innovating, scraping by, doing without, overextending and even overpromising, the successful ones keep their businesses going, and growing. Of course it’s not a linear path to success--they lurch, they make mistakes, then they recover and learn from them. But one fine day they realize they are actually making it, competing successfully in whatever business niche they selected. At that point one of two things can happen:
- They celebrate, relax, and begin to suffer from the “complacent lethargy” that Jim Collins and Jerry I. Porras (Built to Last) called the “We’ve Arrived Syndrome”
- They start to dream about expanding their business, diversifying into other products and services, entering new markets, making acquisitions...you know, taking their business to the next level.
So at the management meeting I ended up sharing with the group some of the most impactful (to me) things I have learned about successful companies, such as their tendency to operate with three perspectives simultaneously: strategic, governance and control, and execution. Sounds reasonable, but juggling those three can be complicated and counterintuitive at a smaller company, where managers often prefer to stay within their comfort zone and focus on execution. But even with flawless execution, a company still needs both a winning strategy and a capable governance/risk management protocol in place to ensure long term success.
Successful companies tend to share certain characteristics:
- They have strategic clarity
- They have objectives and performance metrics that encourage behavior that supports their strategy
- Their rewards are aligned with achievement of those objectives and performance metrics
- They provide regular, constructive feedback to individuals regarding performance against objectives and metrics
- Talent (knowledge, skill and will)
- Speed (capacity for rapid, meaningful change)
- Learning (across silos and boundaries)
- Shared mindset (on the same page)
- Accountability (willingness to accept responsibility for behaviors and results)
- Collaboration (leveraging relationships, sharing work and responsibility)
We also unpacked the three performance categories often associated with talent in a knowledge-intensive business: KNOWLEDGE, SKILL and WILL.
- In the claims service business, KNOWLEDGE involves understanding the law, regulations, contracts and policy forms, as well as understanding what customers want and knowing how to deliver it within necessary margins of compliance, speed, service and accuracy.
- SKILL usually refers to doing, not knowing. Employing best practices, interpreting complicated coverage situations, correctly calculating a business income loss or reinsurance penalty, investigating, evaluating, negotiating, resolution, recovery, communicating with stakeholders, etc.
- WILL refers to the commitment, desire, discipline, or motivation to do something and do it well.
- Create strategic clarity. Agree on what business they are in, and what business they want to be in, and articulate what they need to know and be able to do in order to be successful.
- Complete a stakeholder needs analysis and develop a shared view of who their stakeholders are (potentially anyone with a vested interest in how well they operate their business) and what those stakeholders need in order to be successful and content.
- Take another look at the capability self-assessment summary (the flipchart) and do an honest and critical assessment of their capabilities, particularly their talent. Do they really have the talent and the ability to meet stakeholder needs better, faster and cheaper than their competitors? If not, where are the capability gaps and how will they close them?
- Carefully consider the WILL component of talent within the framework of change and business evolution. Determine what steps to take to influence attitudes and motivation and move their management team, and their company, from compliance to commitment.
Knowing is not enough; we must apply. Being willing is not enough; we must do.In the talent context, it sounds like whoever said this believed in execution. Knowledge and will alone were not enough—he considered skill, the ability to do the necessary things well, to be the critical component of talent. I see it a bit differently, believing that success in almost any human undertaking requires all three elements of talent (knowledge, skill and will.) To me, skill is derivative, developed through the combination of knowledge (understanding what needs to be done, when and how) and will (practicing and perfecting) but I suppose that’s one of the reasons why people find the talent topic so fascinating.
For a thoughtful look at talent management in the 21st century, check out this Harvard Business Review article from professor Peter Capelli. And for an interesting overview of how taking a strategic approach to talent management can help power innovation, growth and market advantage, take a look at this Talent To Win whitepaper from PwC.
Dean K. Harring, CPCU, CIC is a retired insurance executive who now enjoys his time as an advisor, board member, educator and watercolor artist. He can be reached at firstname.lastname@example.org or through LinkedIn or Twitter or Harring Watercolors