Attracting talented Lean managers and executives is a challenge which will only grow more significant as we begin our economic recovery in North America. So make sure you apply a Lean-focused results and value approach to hiring, developing and retaining the best possible leadership for your organization.

•   Make some ONE accountable – because if it’s not in anyone’s job description or performance review, don’t expect to see anyone doing much about searching out, developing and looking after the best of the best.
•   Define those jobs which are strategic to your organization in terms of leadership development and retention – because a talent-management strategy without this focus is no strategy at all and will fail you.
•   Think about and strive and reward to implement these key leadership practices for maximum results within your organization:

Build trust and candor. Great people are inspired by great leaders, and great leaders are honest and trustworthy. Know the potential successors to all direct-reports and make positive connections as frequently as possible. Too often leaders kill trust and candor by being judg¬mental, or more concerned with looking good than acknowledging others. Being a control freak or, on the flip side, avoiding control and blaming others, is a sure way to turn off your talented employees. Yes, it’s the Toyota Way, and it works.

Be accountable for talent. Every individual on your management team must consider identifying and retaining your best employees as “Job One” (with apologies to Ford). All of your HR strategies should be integrated throughout the organization. As with continuous improvement initiatives, you get what you measure. Hold people accountable for hiring well, and for suc¬cession plan execution. Integrate your plan with your corporate strategy and evaluate quarterly. All the top organizations with whom we’ve worked have a talent “war room.” Do you?

Actively protect and promote future potential. You’ve got high-potential players. Why should senior leadership keep “the list” of key employees a secret? After all, we’re not talking Skull & Bones here. Particularly if you’re trying to build a culture of trust and respect for people. Make sure that your top talent knows who they are and then help them to develop. Invest more heavily in the growth of already-excellent talent and extraordinary leadership; almost no amount of spending on “C” players will ever get you a solid ROI.

CEO is the Chief Talent Acquisition Officer. CEOs must take a leadership role in attracting top talent from other organizations. Be a visible evangelist; develop a personal brand beyond your role in the company. Be the kind of leader for whom people want to work. As a leader, be personally accountable for attracting a few key people regularly and serve as a sensei to some of them. Expect the same of other top executives.

Demand only the best. Create tough standards for new talent, and cut your losses when they don’t measure up. When people are performing in an outstanding manner, continue to increase expectations of per¬formance. Strong performers thrive on recognition and ever-increasing challenge, and the opportunity to show what they’re made of. Don’t disappoint them.

Thomas Alva Edison

Turbulent times provide ample opportunities for success, if we approach things with the right frame of mind.

by Adam Zak 

In my role as an executive recruiter specializing in helping companies with Lean transformation, I’ve been spending a lot of my time lately speaking with people all over the world who are wrestling with complex decisions. I thought I’d share some of my observations with you, and in turn, hope that you will share your thoughts with me. 

Everywhere we turn, there’s advice heralding “How to manage in a crisis,” or “New rules for surviving the crunch.” Just the other day I heard a discussion on PBS involving business writers trying to agree on a title for what the economy is going through. And there was no consensus (imagine that, from business writers). 

Crisis Breeds Opportunity 

Craig Barrett, recently retired CEO of Intel told Newsweek readers, “There is a general rule in business life: market share is won or lost during transitions. You cannot save your way out of a recession, you can only invest your way out.” No one is denying that cutting costs is essential to surviving 2009, but we Lean disciples have always practiced a different philosophical approach. As we look for ways to eliminate waste and improve productivity, we are always focused on getting better. In early February Muhtar Kent, Coca-Cola’s CEO told the Wall Street Journal “I’ve been through this movie in smaller versions a number of times in the past…times like these are not an excuse to sit back and ride out the storm.” And this week, at a global sustainability conference in Chicago, I spoke with Rick Frazier, Coke’s VP Supply Chain, who told me they were leveraging their Lean & Green efforts even more dramatically during this time of uncertainty. 

“A recession creates winners and losers just like a boom,” observed Mauro F. Guillen, a professor of international management at the University of Pennsylvania’s Wharton School in BusinessWeek. Let’s chose to be among the winners. 

The Need for Leadership with a Wartime Mentality 

I think any Lean practitioner will agree with me that in many companies upper management has spent too much time focusing on quarterly financial statements and not enough time on long-term thinking. Executives have to lead “their people out of a psychological funk and at the same time tailor their business to focus on a new reality,” says management consultant Ram Charan in BusinessWeek. 

Cut If You Must, But Keep All You Can 

In discussing both strategy and tactics with my contacts, I hear  that many are focused on avoiding or limiting layoffs by instating four-day work weeks, unpaid vacations and voluntary or enforced furloughs. Others are implementing flexible work schedules, wage freezes, or cuts to 401(k) and pension contributions. By keeping controls on people costs, they’re keeping the people. 

For a strategy that pays returns twice, consider this: a number of Lean companies are bringing back previously outsourced work, thus both retaining skilled team members and removing non-value added transportation and outsourcing administrative costs. 

Certainly some Lean companies out there are indeed using these times to reduce staff and make their organizations “leaner” (obviously a total misunderstanding of the Lean concept – so were they really “going Lean” in the fist place?). But most of my clients seem to “get it” and are letting go and hiring too, with an eye to building a better Lean operation and mustering forces to take advantage of opportunities that will most certainly arise, as well as those they can create. That’s continuous improvement with a long-term view. 

As Diane Swonk, chief economist at Mesirow Financial said in Newsweek, “So many CEOs are so focused on defense that they may be missing real opportunities. If you only play defense, you will not be on the right side as the economy bottoms, let alone turns. For us, for instance, there was an opportunity to attract talent and clients as our Wall Street counterparts imploded. The new blood is helping to buoy profits today and will put us in a whole new position on the other side of the crisis.” 

A blog article from HarvardBusiness.org recently cited three rules that leading companies use to maximize service while eliminating wasteful activities: reduce, redesign and restructure. 

Reduce Wisely and Emphasize Talent

Before making painfully aggressive reductions, it pays to keep in mind some potentially serious repercussions:  You risk losing valuable contributors inadvertently, damaging internal morale or your external reputation as an employer-of-choice. You may also lose sight of the important training and staff-development programs which are helping keep your key people engaged with your execution strategy.  Recently, The McKinsey Quarterly advised “By emphasizing talent in cost-cutting efforts, employers can intelligently strengthen the value proposition they offer current and potential employees and position themselves strongly for growth when economic conditions improve.”  Makes sense to me.

Redesign Jobs and Make Them More Engaging

If you want to maximize morale and involvement, Lean practices prove again and again the importance of engaging people. Now is a great opportunity to redesign jobs, and perhaps even career paths, to totally engage the people undertaking them. Adding more responsibility, a greater measure of autonomy, and improved sense of control all weigh heavily on promoting employee satisfaction.

In addition to redesigning roles, companies cutting jobs should carefully protect training and development programs. Again, not only are these  essential to maintaining workplace morale and increasing long-term productivity, but they also provide your  people with the skills necessary to perform their redesigned jobs.

Restructure the Lean Way

Lean can excel in times of crisis. Focused on basic process improvement, Lean solutions often require no capital expenditures. Frequently, companies turn to Lean after buying new equipment or technology that failed to generate expected improvements. Lean is also scalable — management can tailor the people component to meet specific requirements. 

Looking beyond crisis mode, Lean can accelerate the impact of changes by:

1. Using existing Lean experience and leadership in an organization to jump-start the turnaround.
2. Achieving measurable cost reduction and enhanced value to customers.
3. Establishing a framework for improvement that delivers returns to the organization as good times return.

The key is to remember that you’re managing a crisis. The Lean effort can’t become the turnaround; it must work in parallel with efforts to manage cash and reduce costs.

 High Commitment, High Performance 

A February 9, 2009 article in the Harvard Business School’s Working Knowledge series caught my eye. Uncompromising Leadership in Tough Times featured Q&A with author and Harvard professor Michael Beer who has studied the successes of high commitment, high performance (HCHP) leaders in tough times. What he found was that “they shared the view that a firm has a larger purpose than simply profit and increasing stock price, though they were all laser- focused on profitability and saw it as essential to achieving their larger purpose for the firm. They had a multi-stakeholder view of the firm as opposed as a shareholder view. The purpose was to add value to employees, customers, community, and society-not just shareholders.”  

Let’s all of us heed Edison’s advice and find a better way. It will require everyone from the C-suite to the shop floor to think and work differently. But isn’t that what Lean is all about? There has never been a more important time than now.

By Adam Zak

The first LeanConnections in July launched with a single article dedicated to “Respect for People.” It was well received and sparked many thoughtful comments from our readers. Today, in the face of harrowing financial news and pressures on staff and leadership, many of the points addressed previously resurface in this issue where we tackle the dual challenges of retention and engagement of employees. Challenges which may be infinitely more important to address during this economic slowdown. Because if we truly believe that people are indeed our most important asset, the next 12-24 months or so are going to give us ample opportunity to clearly demonstrate that belief.

I earn my livelihood helping companies of the Lean persuasion recruit outstanding executives to meet challenges and achieve aspirations, and I am also a vocal advocate of maintaining a stable, supportive work environment where people can grow and flourish, both personally and professionally. I believe that now is a time when such a workplace is absolutely essential in order that all business stakeholders adapt to and weather the forces that swirl around us.

Create A Highly Engaged Workforce

In that first LeanConnections we quoted Oliver Wyman consultant Jamen Graves writing in Consulting Magazine. Graves advised, “Companies that create a highly engaged workforce benefit from having employees who strongly identify with the company’s success. These employees are willing to go the extra mile; that is, to dramatically increase their level of discretionary effort, which, in turn, significantly improves overall performance. Such employees tend to take pride in their company and are willing to recommend it as a great place to work to friends and family members.” I think we can all agree that these are the kinds of employees who will better carry us through our current trying times.

You may also remember that I raised the questions: “Other than for the money to support ourselves and our families, why do we really work? What’s really in it for us? And how will each of us make this very personal choice in a world where talent is the most scarce of all resources?”

As The Beatles Said, “Money Can’t Buy Me Love”

An engaged, respectful (and respected) team delivers the goods for employees, management, customers, shareholders and everyone else with a stake in the success of your Lean enterprise. In ordinary times, it works because people want to make it work. In times like these, it works even harder because it never becomes just a process; it remains the key to living and working together successfully. It’s the foundation that underlies the salaries and benefits we pile on top.

While I generally try to avoid using sports analogies, this one may be apropos in the current business climate. Imagine yourself in top management of an NFL team and the season has just ended. Whether you won the Super Bowl or finished at the bottom of the standings you have some important personnel issues to deal with. Because no matter where you finish in a given year, you’re always trying to improve. As a Chicago football fan I’ll be one of the first to testify on that. And that means deciding which players you must retain at all costs. Calculating whom you could afford to lose. And maybe most importantly, identifying skilled position performers and rising stars who might become available, or could be persuaded to change teams under just the right conditions.

That’s the current state your “team” is in at this very moment. If you’re an industry leader, it’s an excellent time to secure this enviable position for years to come. Or, if you’re committing yourself to come out of these economically turbulent times poised to charge to the top, now may be the best opportunity you’ll ever have to retain and recruit your way to greatness.

Either You’re Building, Or You’re Rebuilding

Last February, Maximize Possibility Blog spelled out “4 Tips for Hiring During an Economic Slow Down.” Their four rules are summarized as follows:

1. Be choosy, numbers are on your side – so broaden your selection horizons to include criteria other than just experience and education. Look at things such as passion for your industry, cultural fit within your organization, and the presence of soft skills such as strong interpersonal communication, empathy, and likeability.

2. Beware of the “low-bid.” While it may be tempting to hire an individual for the perceived payroll saving they promise to offer, doing so usually costs more in the long run. Bottom line – pay your team members what their positions are worth.

3. Wait for the best talent possible – While economic downturns are generally short lived, time is on your side. Hiring anything less than the best talent you can afford will ultimately rob your organization of possibility and profits.

4. Match candidates to the right jobs. It is absolutely critical that you insist on hiring team members who are a good fit for the position based on their unique behaviors, values, and personal talents.

But it’s not enough to build or rebuild your team. You have to inspire them to achieve great things.

Work And Life: A Balancing Act

In a recent posting on ERE.net, “A Work Strategy for a Good Life: Attracting and Keeping the Best” by Kevin Wheeler, the author addressed issues of work/life balance, paying particular attention to differences between generations. “I can’t think of any organization that has not had to change policies or at least address its employees on the issue of work/life balance. Perhaps it emerged because more Gen X employees moved into leadership positions and were more aware of the precariousness of employment and about how quickly corporate can swing from breakneck hiring to layoffs. But whatever the causes, the issues involved are core to whether people accept offers, stay with an organization, or decide to work for themselves.”  

But why should this matter only to those within Gen X? Doesn’t everyone want to know that his or her role is making a difference? That they’ve accepted some risks and solved problems? That they have been part of something larger than themselves and were in some way instrumental in the success of that something? If you asked your employees to what degree they felt engaged, how would they answer? Would those responses be truthful? Would they be the answers you expected?

Other work/life factors also play into improving the mindset of your team members. A Deloitte Consulting LLP report entitled “Retention Strategies during Difficult Economic Conditions” provided some additional insights. “Companies are wisely trying to ease the strain on employees by improving their work environment. Many companies are implementing or expanding workforce programs that are designed to make balancing work and family easier. These include flexible work schedules, telecommuting and compressed workweeks. While these programs won’t put dollars in employees’ pockets, they can go a long way toward helping employees view their company more favorably, making them less likely to leave.”

Human Sigma: Six Sigma Meets Human Nature

Many Lean practitioners will relate positively to a relatively new, emerging idea, Human Sigma – I know I do. It’s a branch of Six Sigma focused on improving employee-customer interactions. I learned more about it in a recent article on isixsigma.com, “Strengthening the Employee-customer Interaction,” by Peter Sherman.

Human Sigma is an approach to management that recognizes human nature and uses that knowledge to achieve three objectives:

- To manage and motivate employees

- To accelerate their development

- To engage customers’ emotions.

Proponents of Human Sigma believe that “emotionally satisfied customers contribute far more to the bottom line than rationally satisfied customers. The key is to strengthen the employee-customer interaction,” wrote Sherman. In order to measure any company’s Human Sigma score, Sherman referenced a book by John H. Fleming and Jim Asplund. Human Sigma: Managing the Employee-Customer Relationship, which established a rudimentary measurement formula. The authors surveyed employees and customers with a series of 12 questions for each audience, measuring employee engagement on the one hand, and customer satisfaction on the other. Answers on a five point scale ranged from 1 (= no agreement) to 5 (= extreme agreement).

Four Core Principles Of Engagement

As a result of their research, Fleming and Asplund defined four core principles that great organizations and managers exhibit as key characteristics of employee engagement and customer engagement. Sherman reported these principles as follows:

1. Manage by outcomes, not behaviors – In other words, although the end remains constant, the means to achieve that end will inevitably vary between individuals.

2. Liberate, don’t legislate – The most dramatic increases in productivity occur when companies allow workgroups to choose their own initiatives and focus on them. Anything that makes employees passive viewers instead of active participants in the employee-customer encounter is counterproductive.

3. Engagement is for everyone – The ability to capture the heads, hearts, and souls of employees and instill an intrinsic desire and passion for excellence.

4. All politics is local – Companies cannot dictate employee engagement from corporate headquarters. They must manage engagement locally. To this end, the local manager is the single most important factor in local group performance.

Does this sound like a game plan for more effectively engaging the teams up-and-down and all across your organization?  How would your internal and external customers benefit from this level of focus on team member engagement?  Would your business stand a better chance for successfully maneuvering its way out of this economic storm?

These Times Require A Culture That Sustains All Employees

As cited in the first issue of LeanConnections, Frank Brown of PricewaterhouseCoopers (PwC) was quoted in Harvard Management Update on the importance of building a culture of retention. “In good markets and bad, there are always opportunities for top performers. The real trick is creating a culture that sustains all employees, and engenders a positive response to questions like these:

- Is my work valued?

- Does my opinion count?

- Are new ideas welcomed?

- Are people treated with respect?

- Am I evaluated and rewarded on my performance?

- Does leadership act with integrity?”

The challenge for those of us in the Lean Community is to embrace and explain the true nature of mutual respect for people – managers and associates – so all organizations can move toward a new and better way of solving their problems.

No Matter What The Economy Is Doing, Retaining And Engaging Pays Off

A current newsletter from Deloitte Consulting LLP asked the question “Cash or Talent?”  Given the recently pronounced recession, “What should business leaders do in the face of the current economic crisis? Should they focus on maintaining cash or people? What should they make their top priority?”

No contest in my book, unless maybe you happen to be the Chairman of one of the Detroit Three. Engagement and retention strategies must win out because people are absolutely essential to weathering the current economic storm. But looking beyond the turmoil, these same efforts should continue to pay dividends for a long time into the future. Always remember that the people you chose to retain and engage today are the same people who will choose to be retained and engaged tomorrow. Take this opportunity to practice what you’ve been saying all along, that people are indeed your most important and valued asset.

(Return Index)

Throughout my own Lean journey I’ve connected with thousands of Lean practitioners whose ideas, advice and kindness have transformed me both professionally and personally. So I created LeanConnections to begin a “digital dialog” where colleagues, associates, clients and friends can share their thoughts on timely and important topics.  

Our first issue was published in July, 2008.  Your comments and participation enthusiastically invited! Sign to recieve LeanConnections in your e-mail about 4-5 times a year by logging in to our main Web site at www.LeanRecruiter.com.