Before we plunge headlong into a new year, new budgets, and new plans for growth and business progress, we should take a moment to reflect on and consider the lessons learned in the past year. Vern Law, former major league baseball pitcher for 16 seasons, stated that “Experience is a hard teacher because she gives the test first, the lesson afterward.” If we ignore the lessons learned from the year about to end, the tests coming in the year ahead promise to be that much more difficult.
Focusing on the business landscape, there are four obvious lessons that have surfaced in 2018 which every business owner and CEO should consider alongside the strategic and budget plans in development for the next 12 months.
Lesson 1: Identify, Elevate and Support Women In Leadership
Inside or outside your organization, the rising tide to balance leadership roles equally across genders is an opportunity for forward-thinking companies to rise with it and champion the results. More women are joining the ranks in Washington D.C., in board rooms across the country, and in c-suite leadership positions than ever before and, according to a 2018 Pew Research Center study, nearly 60% of adults agree that there are too few women in high political offices and top executive business positions in the country today.
Though public opinion favors more women in top leadership positions, there are numerous opinions as to why gender imbalance continues. “About seven-in-ten women – vs. about half of men – say a major reason why women are underrepresented in top positions in politics and business is that they have to do more to prove themselves” according to the Pew report. Many particular skills are perceived to be more strongly represented in female leadership, though “the public is skeptical that the country will ever achieve gender parity in politics or in business.”
Organizations that are identifying and supporting the growth of female representation in leadership roles are rewarded with consumer loyalty, talent acquisition, and retention and brand lift for their efforts.
Lesson 2: Adaptation Is An Asset
New cost structures, regulatory changes and innovative workflow processes continue to drive business across the globe.
Technology is creating new efficiencies. Rapid market fluctuations demand real-time business response. Demographic shifts have more diverse populations sharing the workplace. All of these and more create management challenges never before encountered.
“Adapt or die” is an often repeated mantra that holds more relevance as each year passes and change continues to escalate. For businesses that continue to operate as they always have, prospects for growth are limited. “One of the greatest advantages of CEO peer groups is the opportunity to learn from other business leaders, companies, and industries who have navigated changes and learned from both their victories and their missteps,” said Dr. Kiu Leung, executive coaching and forums leader for Renaissance Executive Forums in Madison, Wisconsin. “The hows and whys behind business progress require existing systems to adapt, and companies need to invest in adaptation the same way they invest in the development of other assets that fuel any company’s future.”
Adaptation comes in many forms, from changing products and packaging, to developing new markets and verticals. Many businesses set aside budgets to try out new concepts, being open to whatever results occur. “The more you can test and adapt, the better success you'll have as technology changes. Ultimately, being more prepared for faster and faster change is necessary for entrepreneurs and managers. If you're not learning, you're losing.”
Lesson 3: Healthy Organization Culture Matters Much More Than The Investment To Make It So
Creating a healthy organizational culture is all about taking care of the people involved in your business; employees, customers, influencers, and stakeholders of all types. Openly defining and supporting a set of underlying values, and investing in the promotion of those values through company activities, has many recognized benefits. The development of a unifying organization culture promotes community, reduces environmental stressors, and drives operational results at the same time. To arrive at those benefits takes some commitment, prioritization, and continued effort.
At the heart of any company culture is the teamwork necessary to build that culture and keep it going. “Incorporating the input and feedback of a team invests all participants in the outcome,” continued Dr. Leung. “Even if it’s driven from the top, a single individual can’t create and sustain the culture for the whole organization. The investment and approval needs to be driven from the executive team, but it takes a broader, more integrated team to create a community, to foster a culture and to share that culture with others.”
Author Patrick Lencioni suggested three virtues that are essential for developing a healthy team environment: humility, hunger and smarts. “These are not inherent traits,” he confesses in his book The Ideal Team Player. “Team players aren’t born that way, but they come to embrace the essential qualities through life experiences, work history or personal development.” Many team members who display humility put the team, and the organization, above individual achievement, and it’s considered the most crucial of the three attributes for building company culture.
Once the cultural drivers for the organization are decided, one of the key responsibilities of the team will be to showcase “people who exhibit those virtues and publicly hold them up as examples” which Lencioni praises as the “best way to create a culture”, as long as the strategy is invested in by all levels of the organization.
Lesson 4: Undervalue Emotional Intelligence At Your Peril
Long considered a “soft science”, the importance of emotional and social skills in top executives is finally starting to be recognized thanks, in large part, to the work of Daniel Goleman. His book, What Makes A Leader?, explains both the definition and importance of Emotional Intelligence qualities in the context of business management. Though impossible to document on a resume, Goleman has enlightened the marketplace that levels of self-awareness, empathy, and social skills are more vital than business acumen for effective c-suite leadership. “It’s not that IQ and technical skills are irrelevant. They do matter, but mainly as ‘threshold capabilities’; that is, they are the entry-level requirements for executive positions.” “Every businessperson knows a story about a highly intelligent, highly skilled executive who was promoted into a leadership position only to fail at the job. And they also know a story about someone with solid – but not extraordinary – intellectual abilities and technical skills who was promoted into a similar position and then soared.” Emotional Intelligence or EQ makes the difference.
As early as 1996, studies showed that those senior managers with “a critical mass of emotional intelligence capabilities…outperformed yearly earnings goals by 20%. Meanwhile, division leaders without that critical mass underperformed by almost the same amount.” Now that EQ skills are gaining long overdue respect, employers need to develop new vetting processes to discover the EQ levels of would-be executive leaders. “It was once thought that the components of emotional intelligence were ‘nice to have’ in business leaders. But now we know that, for the sake of performance, these are ingredients that leaders ‘need to have.’”
The good news, for established executives and their teams, is that EQ can be learned and improved over time. Therein lies the crux of the lesson. It takes time, effort and prioritization to build critical levels of EQ in an organization, and those who understand its value and seek it out in their top leadership are ahead of the game.
There is truth in the phrase “hindsight is 20/20 vision”, and many CEOs take that advice to heart at the end of the year, reflecting on past events to make necessary future changes. Across the business horizon, the lessons above are broad generalizations, though applicable to any and all growth-minded organizations.
For CEOs and business owners who are interested in digging deeper and conferring with peers around future strategies and solutions, executive forums, CEO Learning Sessions and peer advisory groups are sought-after resources. Business leaders in Madison, WI who are interested in participating in a CEO peer discussion on business value creation should consider attending the upcoming CEO Learning Session: The Path to Higher Profitability in 2019: 8 Key Factors on January 15, 2019 at the Fluno Center.
Renaissance Executive Forums is the one place that Madison’s business leaders can convene to learn from each other and sharpen their CEO skill sets: leading their teams and their businesses to success, discussing confidential business solutions to current challenges, and exploring executive leadership on a whole new level. Invited members have access to executive business coaching and trusted peer advice forums, all led by nationally-recognized quality assurance and business process expert, Dr. Kiu Leung. For more information visit https://executiveforumsmadison.com or call 608-826-7488.