Leaders must be able to give feedback

You cannot guide and improve the performance of others unless you have the ability to give effective feedback. As a senior leader’s ability to perform is based on the performance of others, giving feedback is a key determinant of a leaders ability to succeed.

It is amazing then that so many senior leaders are poor at giving feedback. Many will work around poor performers putting feedback in the too hard basket. Others take a one-size fits all approach to every scenario “I give it to them between the eyes every time to make sure they understand where they are failing.”

There are four rules to giving feedback

1. Do it. Do not put it off; do not leave it. If someone is unaware about the detrimental impact of their performance or behaviour they need to know about it and they need to understand the ramifications. The longer you leave it the harder it gets for both parties.

2. Be crystal clear. Ambiguity destroys the impact of feedback. Either the feedback will have no effect or it will have the wrong effect.

3. Tailor your delivery. As an absolute last resort it may be appropriate to “give it to them between the yes,” however this is incredibly rare. Positioning feedback in a way that the recipient will be pleased, even relieved to have had the conversation will get better results.

4. Agree a way forward. Always give the recipient a way forward, or work with them to agree a way forward. Let them know what your role will be in both helping and monitoring them.

Remember, by giving someone feedback you are doing them a favour. Give feedback in a way that will help others to be grateful for your effort; maybe one day your favour will be returned.


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Australia’s Political Leaders, where are they?

The latest Newspoll (conducted for The Australian newspaper) clearly shows that Tony Abbott and his alternative, Bill Shorten, have both lost popularity with the Australian public. The recently released Reader’s Digest Australia annual Trusted People survey of 2014 listed door-to-door salespeople, politicians, insurance salespeople, sex workers and call centre staff as the least trusted professions in that order. At least Tony and Bill can take some comfort from the fact their unpopularity isn’t just about them, its about their profession as well.

When evaluating CEO’s and their senior management team I review ability from four perspectives, strategic, collaborative, inspirational and achievement.

When considering Tony and Bill’s strategic ability is it in the context of what is best for Australia or how they stay in/get in power? All we seem to hear from an opposition party (the current opposition and their predecessors) is negative, for example both have played the broken promises line very consistently. This constant sniping is at best tactical and is certainly not strategic. What is our big picture vision, what are we trying to be? Can either Bill or Tony answer this?

Collaborative ability is hard to assess without seeing how Tony and Bill work with others, internally and eternally to their own party’s.

Inspirational ability. A leader will not inspire you unless you trust them, why would anyone want to follow someone they don’t trust. The results of the Reader’s Digest Australia annual Trusted People survey would suggest both leaders and their colleagues are short of the mark in this aspect of leadership.

Achievement ability. This is strategy implementation. This is not about agreeing with the action, for example raising the retirement age to 70 is an action regardless if it is a good strategy or not. It would be an interesting case study to list the major actions either party has taken in the last three years. Further more it would be worthwhile noting which of these actions have impacted marginal seats.

Australia is crying out for political leaders who have a big picture view for Australia and not just their own power; leaders who work well with our neighbors while ensuring alignment with our own needs, leaders who have the strength of character to stand by their beliefs and deserve our respect if not always our agreement and leaders who strive for action that is driven by a overarching direction and not the ballot box.

Simon Tedstone

Director, Leading Change Consulting


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Billable hours, the not so Holy Grail of professional service firms

When monthly billable hours are up everyone is happy, especially the partners. Managers and staff who are billable high performers are the ones that get ahead; they are the firm’s high potentials. Over many years and in several countries we have seen this across numerous firms. When this focus on billable hours becomes dominant we have also seen the following problems that have resulted in poor financial performance and even the demise of a firm.

  1. Who does the work? Partners, and senior associates, in order to meet their own billable hours targets, are doing work that is below them, they are doing work that should be performed by more junior staff. This is detrimental to staff development and even more crucially firm profitability.
  2. Short term client focus.       There is more concern for next month’s billable hours than next years. This can lead to customer relationships being more transactional and transient in nature, in todays more competitive landscape this is a flashing red light for many firms.
  3. Siloed mentality. Partners and managers have little practical or intellectual concern for the firm as a whole instead focussing solely on their own division. In this case the firm exists only to provide some administrative economies of scale for its divisions that then operate as independent business units.

There is no dispute that billable hours are important, however billable hours will only ever be a lag measure. The most successful firms are the ones that focus on next years clients and how best to meet their needs. There are two keys actions they take to do this.

Talent and succession management. They develop and promote partners who can think strategically, work collaboratively and inspire their key stakeholder to achieve great things together. One firm we have worked with to achieve this went from being a top 20 English firm to a top five global firm over a 10 year period.

Client focus. They develop a real value for clients and all things relating to client needs in the immediate to mid and long term. Managers and staff are empowered to make decisions that benefit their clients. Client’s needs are anticipated so solutions thinking is pro rather than reactive.

In todays environment firms that focus on having the best client focused leadership will succeed ahead of their competitors. Firms in the mid tier that are large enough to have critical mass but smaller enough to be flexible are in the best position to do this. All too often it is also these mid tier firms that are most likely to fall into the short term billable hours trap.

By Simon Tedstone

Director – Leading Change Consulting

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Talent Management – the fun side

Talent Management is very serious stuff; when managers and HR discuss talent they always have their extra serious faces on. They are, after all, considering the future of both individuals and the organisation as a whole, so it is worth taking seriously. They pour over work based information and high potential assessment reports (way too many of which are on-line self assessments, but that’s a story for another time) and try to draw conclusions about who is and is not talent.

There is a fun, fascinating and incredibly rewarding side to talent management, it is the reason I work in talent management. Talent management is all about unlocking the potential of people and as a result their organisation. Only a very small minority of employees have nothing more to offer. The trick to the best talent management is how to work with employees to find out what their talent is and how best to grow and leverage it. Talent management is about “win win” relationships between employers and employees.

Talent Management is viewed too simply; it is not about who is good, i.e. high potential and who is not. Neither is it about simply viewing talent against role seniority.

Talent management is about employees understanding their preferences and motivations (something on line self assessments are excellent for) as well as their strengths and weaknesses (no one is perfect). This information is then used to inform the relationship between employer and employee so both can progress in a mutually beneficial direction. This may mean, for example, they consider moving sideways rather than up or becoming a technical expert rather than a general manager. At times, it may also mean employees realise it is time to move on to a new organisation. Some may consider this a risk but it is far better for an employer and employee relationship to end through talent management than performance management.

Talent management is fun, interesting and exciting because it is about unlocking potential and creating a mutually beneficial relationship for all.

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Board’s must measure leadership performance

Board’s must take responsibility for managing the leadership of their organisations. The ASX Limited Board Charter states that it is the Board’s responsibility to “Appoint and assess the performance of the Managing Director and CEO, and oversee succession plans for the senior executive team.”

What constitutes performance? In recent research we conducted performance was generally considered to be financial. There is no denying that an organisation’s finances are hugely important but they can only ever be an historic measure. Lead measures are essential and there is no lead measure more critical than the leadership ability demonstrated by the CEO and the senior executive team. Two case studies clearly illustrate this:

Company A, a nation wide, well established financial services company that had a strong balance sheet, good profitability and a solid financial history. The Board were happy. What the Board didn’t know was the CEO, who had been appointed 18 months previously, was struggling. His strong and directional approach that had served him so well in the past was not working. He felt he knew the answers but others in the company did not agree. Staff were frustrated by what they believed was his micro managing. Decisions were being made that adversely impacted customers. When this all became apparent 18 months later the company’s financial performance had dropped considerably and the CEO had just resigned.

Company B, another national company.  Again strong financials, again a CEO who had been appointed 18 months previously and again a very happy Board. However this Board still chose to have their CEO’s leadership appraised by us. To the surprise of the Board the CEO appraisal highlighted a number of red lights.  Staff, and in particular senior staff, did not believe in or trust the judgement of the CEO. The CEO was acting unilaterally in a number of areas where he did not have the expertise. New systems weren’t achieving the needed outcomes. Staff morale was plummeting. Needless to say a very robust conversation took place between the CEO and the Board. Within three months the Board and the CEO agreed to part ways.

While neither of the above case studies have a perfect outcome, Company B were made aware of the poor leadership early enough to do something about it, and thus the impact on their financial position was negligible. Company A struggled before being acquired.

Appraising a company’s leadership annually is simply good risk management, it is part of good corporate governance. It is because Boards are responsible for financial performance that it is essential that they appraise and develop the leadership performance of their CEO and senior executives. Unfortunately too few Boards do this effectively.

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Who’s leading your investment?

The vast majority of Private Equity (PE) and Venture Capital (VC) firms do not actively evaluate senior leadership during due diligence, nor do they manage leadership post investment. This was the finding from research we recently conducted.

Leadership has an integral impact on performance and therefore return on investment (ROI). The significant salaries paid to senior executives and considerable academic research support this view. Therefore this finding should be of concern to PE and VC investors/partners.

At Due Diligence Stage there are four key areas that need to be considered and understood

  1. What impact has leadership had on performance to date?
  2. What leadership attributes are required going forward.
  3. What leadership attributes do the incumbents have?
  4. How big is the leadership gap?

Given leadership is a predictive rather than historic performance indicator, knowing the leadership ability that is being invested in is essential to decision making.

Post investment the key focus is to manage the leadership gap. Leadership attributes need to be measured and considered against the leadership needs of the organisation. Once this is done only three options exist, to recruit, to develop or to guide leadership.

Measuring leadership performance and gathering this feedback for the CEO and the board/investors on an annual basis is not unlike having an annual health check. The leadership ability of an organisation’s CEO and their senior team is highly indicative of future performance. Therefore, undertaking this leadership assessment is likely to inform the board/investors of potential issues and problems before they are fully realised.

Measuring and managing leadership performance is not without its costs. However, compared with the cost of the investment not performing, or even failing the cost of measuring leadership ability is simply prudent risk management. Good leadership management should be more than just risk management, it should be about having the right leadership to seek and action opportunities, it should be about looking for future success rather than just protecting against failure. This creates a real opportunity for those organisations that pro-actively measure and manage leadership in line with needs and challenges. These firms and organisations are not only less likely to fail, but they are more likely to succeed and have higher rates of ROI.

So if you are investing remember, you’re not just putting your money into a business plan, you are investing in the organisation’s leaders to make the business plan a reality.

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Do senior leaders collaborate?

Yesterday I had the misfortune of seeing 10 minutes of question time in Federal Parliament. This, very definitely, is not something I normally do. One side puts a perspective forward amid much over yelling from the other side, the speaker tries, with little success, to ensure the message is heard and then the questions, or should I say accusations start. So these are our most senior leaders at work, depressing I thought. The objective was to compete rather than collaborate.

Is this the same with senior leaders in the business world? At least in parliament everyone is open about being on different sides. In business what percentage of a senior leaders time is spent protecting their own brand, undermining the brand of others and then actually working on the needs of the business?

It is a fine line between being politically savvy in order to achieve business needs versus being politically savvy just to achieve ones own needs. Again the answer lies in the motivation of our leaders. Do they want to climb the ladder simply to be powerful or do they want to get to the top so they are in the best position to make a positive difference?

Both in business and in politics too often we fail to consider the motivations of our leaders. No one wants to be led, especially in challenging times, by someone who puts themselves, and their survival/success first. Yes you need driven people who are motivated by success to drive performance. However if a leader puts their own needs and aspirations ahead of the company, sooner or later, they are going to make a decision that has significant ramifications for the company and the more senior the leader the more catastrophic those ramifications can be. In my experience those leaders who put themselves above the company also have a knack of moving onto to their next role before things go bang.

Therefore find out what motivates your up and coming leaders and weed out those who put themselves before the company. No single leader has all the answers, make sure your senior leaders operate as the sum of their intellectual parts and don’t behave like a bunch of politicians.

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