PREFACE:

One of the most difficult tasks for many leaders is clearly identifying the people assets of an organization.  Too many leaders pay too little attention to this requirement for leadership.  Jim Collins admonished us to make sure we have the right people on the bus but the only way we can do that is to know three critical things about your organization.  First you must know the real reason the organization exists.  This is not about mission and vision statements. This is about getting to the underlying reasons for the organization’s existence.  It’s not about platitudes; it’s about attitudes.  Without crystal clarity of purpose, there will be no foundation upon which to build your team.

The second thing you must know is what specific behaviors and actions will best lead to the fulfillment of the purpose.  By knowing everything that must be done and how those actions should be taken, you can become a leader that is focused, disciplined, and strategic.  Without this knowledge you are shooting in the dark.

The third thing you must know is what types of people will be needed to complete each and every aspect of the activities that lead to success. If you are building a financial portfolio you will pay careful attention to your asset allocation.  Leaders must be just as cognizant of their human asset allocation.  Just as with our finances, imbalance can put our entire investment in jeopardy.  Too many people, who have the same skills, think the same way, or draw from the same experiences puts your team at risk.  We have had clients that hired people that mirrored management styles of upper level management.  In times when alternative views would have been quite helpful, everyone was thinking the same way.  Even though they thought they were doing all the right things, success was elusive.  To generate the types of alternative approaches to getting desired results requires that there be a healthy dose of diversity in the thinking perspectives of people on the team.

Some leaders have excellent intuitive senses about people.  They can speak with a person for a few minutes and have a fairly good assessment of a person’s strengths and blockers.  They can also ascertain what motivates people.  But, most of us need some help in making these determinations. There are a variety of assessments that can be done to help leaders better understand the talent that exists on their teams. We use a suite of assessments that tell us about an individual’s strengths, blockers, values, beliefs, predominant behavioral tendencies, leadership preferences, and key motivators.  When we have this information about the people on our team we can make informed decisions about how we deploy people.

In a recent conversation with one of our clients we were able to help the CEO understand that a key individual would be better deployed in a much different position.  This individual was in a direct customer contact position and had very low scores for influence and people skills.  Where this individual had strengths was in the area of compliance and consistency.  In a position with direct contact with customers it was necessary to be able to react to situations and come up with new approaches to getting the sale completed. This individual was much happier with routine and standardization.  There was another position within the organization that needed a person that could take a set of standards, apply them to a designated process, and complete a series of formulaic processes so as to keep the business in compliance with required guidelines.  Upon moving the employee from direct customer contact to this more compliance oriented position, the business improved customer relations and increased their ability to stay within required boundaries for operation.  This was a win for the employee, a win for the customers (as a new customer service rep was brought on to handle that role) and a win for the business because it has happier customers, happier employees, tighter compliance, and a healthier financial bottom line.

In the article that follows this introduction, we describe a story that has been told to us by Vaughn Grisham, the Director of the McLean Institute at the University of Mississippi. We are indebted to Vaughn Grisham for the numerous conversations we have had over the years.  His insight into how human assets trump physical assets has helped us understand that this is not simply a community building/community development concept.  We understand that it is good business to care about people; your employees, your customers, and the surrounding community members all have relevance to your profitability.

Some leaders look at these human capital pieces of an organization as being soft and fuzzy.  But we have shown our clients that human capital is fundamental to profitability.  Our largest client, a very large food service industry company in the Southeast, was spending more than $4 million per year as a result of employee turnover.  By convincing the company that they could reduce turnover by becoming more intentional in the way they recruited, hired, on-boarded, trained, deployed, and developed employees, we helped them discover an instant way to impact their financial bottom line.  Since adopting this more intentional and scientific approach to personnel management, they have all but eliminated their turnover problem.  This is saving the company over $4 million per year which is reflected in a much healthier profit-loss analysis for the business and has made the share-holders very happy.  By the way, the employees are ecstatic with the new processes.

Any business can do this.  You don’t have to be huge to make a big difference.  We’ve seen these procedures work for businesses with 10 employees or 1,000 employees.  The only prerequisite is that leaders must take the time to find out who their people really are and then deploy them based on what they learn.

THE ARTICLE: Identifying Assets: People Based Assets

Every situation and circumstance exists in a context.  Nothing is isolated and independent.  Within the context of every situation there are assets that can be used to help us get a job done.  And do not be fooled, there is always work to be done, even when we are relaxing and taking it easy.  Life is work!  Don’t think this is the case?  What do you do to relax?  Play golf, fish, take a walk in the woods?  Are these activities free from work?  Maybe it’s not work like “WORK,” but it is still work.

What possible assets might exist in a given leadership scenario.  One of my favorite stories is the Tupelo Mississippi story as told by Vaughn Grisham, Professor of Sociology at the University of Mississippi and Director of The McLean Institute for Economic Development in Oxford, Mississippi.

At the end of the 1930’s Tupelo, Mississippi was a dying cotton town in one of the poorest counties in Mississippi. The Tupelo Story is about how a local progressive thinker and newspaper owner named George McLean started a development program that turned his town into a thriving and prosperous community that was the top dairy county in the United States.

McLean’s first step was to find out what they could grow on the depleted soils of Lee County, Mississippi.  He was told you can grow trees or you can grow alfalfa hay.  Trees would take years to return an economic benefit while the hay could be put to use right away.  But they were going to need something to do with that hay.  All the farmers in the region had a few cows that they kept for family milking purposes.  What if they changed that into a commercial dairy farming focus?

McLean convinced Tupelo businessmen to help invest in the purchase of a high-quality stud bull. McLean told the hardware store owner, you may not like me, but you need me. You took in $6,000 last year. You’ll never make more than that until you help increase the amount of money your customers make. The local businessmen bought the stud bull and the cows were fed the alfalfa hay and new baby calves were born and the dairy industry began.  Within a few years, the investors had been repaid and Lee County became one of the biggest dairy producers in the country.  All of those farmers had more money in their pockets and they spent their money in the stores in Tupelo.  Needless to say, those business owners were now believers in what George McLean was telling them and became the first in line when it was time to create a Community Development Board, that Board still exists today and drives the continuous improvement of Lee County Mississippi.

In a poverty stricken town in a poverty stricken county in a poverty stricken state they still found the assets they needed to change their fortunes.  They didn’t wait for someone else to rescue them; they pulled themselves up by their own boot straps.  Let’s take a moment and really think about all of the people based assets we have right here in St. Joe County!

SUMMATION:

In many business, organizations, and communities it is common to decry the poor state of affairs that prevent us from achieving greater things.  The example of Lee County Mississippi teaches us a valuable lesson.  It’s not about the conditions we find ourselves in; it’s the conditions of our resolve that will make the difference.  We may not have abundant material assets at our disposal but we have the most critical asset of all, people.  How we engage people and allow them to do what they are best suited to do will have huge impacts on the success of our organization.

All too often we hear about a leader that believes he or she has to tighten the reins on their people.  There’s this belief that you have to keep the people under control or they’ll run amuck. But people are better than that.  People want to contribute and be part of something meaningful. When liberated from the bondage of small thinking “leaders” we have seen organization members do things that are absolutely amazing.  Consider these examples:

  1. A business owner thought he had to oversee every contract his sales manager was negotiating with clients. Clients who thought they had a deal saw that the sales manager couldn’t finalize these contracts and got suspicious.  Many of them wouldn’t sign on for services and the company wallowed, unable to increase its client base.  We helped the owner let go and allow his sales manager to fully negotiate and sign the contracts.  The owner’s fear was that the sales manager would sell services at a price that would not cover costs and produce adequate profit.  What the owner saw over the next 12 months was a four-fold increase in revenues and an amazing increase in profitability.
  2. A school district had a superintendent that kept information away from subordinates and made all the decisions from his office. As a result, principals and supervisors felt as though they had no control over what they had to deal with on a daily basis and became somewhat paralyzed regarding decisions they had to make. Minor situations tended to fester into major problems that required significant efforts from the superintendent which could not always be handled in a timely fashion and parents became frustrated and started taking their children out of the school system and enrolling them in alternative institutions. The superintendent left the district and a new superintendent came on board and we helped the school district adopt a new approach to a more empowered decision-making model. Given the freedom to act, principals and supervisors started to take personal responsibility for the quality of performance.  The environment improved.  Parents started to feel like the school cared about them and their children.  They stopped pulling their children out of the school and some of those who left in the previous years started coming back.
  3. A fast growing business had a CEO who kept an iron-tight grip on everything that was going on with the business. When it was a small business with just a few employees, it wasn’t a big deal.  But as the business grew from a local, to regional, and then national organization, it became harder and harder for the CEO to stay on top of every little thing that was going on.  His first step at turning the reins over to someone else happened with the hiring of a Chief Operating Officer.  The COO was given the responsibility of making sure that processes were followed the way the CEO wanted them to be followed.  The COO thought he knew exactly what the CEO wanted and began operating from that belief.  Within a few days the CEO was standing in the COO’s office asking what the heck was going on.  Who told the COO it was okay to change a procedure.  The COO responded with, I thought you wanted me to make sure the service processes were followed by all the employees all over the country and this new procedure made it easier for them to follow the process.  The CEO fired the COO and went back to handling everything himself.  The business stagnated, people started quitting at the remote sites due to lack of support from “Corporate” and customers cancelled contracts due to a lack of service as promised. 

    This CEO came to us for help in finding the right people to fill all these positions.  We started with a discussion about what he really wanted.  Why does his business exist?  When you go back to when you started the business, why did anyone want to buy the service? Now that we know why, let’s take a look at who is needed to deliver that why to your growing customer base.  What will they need to know to be able to this?  What will they need to be like to be able to do this?  If they are people like you, how will they respond to a boss who watches every little thing they do? How would you respond to that type of boss?  Now let’s build an organization that can do what you want it to do.  This company is growing again.  The CEO recognizes that his approach to the world can inhibit growth and development of those who work for him.  He found a new COO and set very specific expectations for behaviors and performance before the person started and he gave this new COO the latitude to create procedures that would improve efficiency and effectiveness without needing prior approval of every little thing.  But the COO knew that major changes needed to be discussed with the CEO before they are discussed with anyone else and before they are implemented.  The business is moving in the right direction and before any new key sales or service person is hired, the company makes sure they all know exactly who nit is they are hiring.

We cannot overemphasize how important it is to be fully aware of and to properly deploy the talent on your team.  Your human assets will determine whether or not you have material assets in your business.  The success of any organization is directly related to the quality of relationships that exist between the people who must participate and conduct the business of the organization.  Ignoring or marginalizing your human assets is one of the biggest mistakes any leader can make.

© 2013-2015 Culture by Choice-WTBG, Lake Geneva, Wisconsin: All rights reserved distribution of this information outside of an academic setting no permitted without express written permission from Culture by Choice-WTBG.

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