2-4 Page-Organizational Vision

NTHE MIND OF GREAT

COMPANIES? By Scott Blanchard

T he old saying, "money isn't everything," rings hollow in today's business world. where rninute-by-minute stock quotes scroll across our computer monitors, and careers are won or lost based on Wall Street's analysis of a

company's perforniance. Throw in giob- al competition, outdated products and services, increased costs, corporate silos and other business challenges, and it's no wonder that tnatiy of today's compa- nies focus solely on their bottom line, ofteti at the expense of customer service and employee satisfaction.

It need not be this way. Great compa nies focus on more than one bottom line when gauging their perforniance. Ttiey choose to be not only the invest- ment of choice, but also the provider of choice for their products or services, as well as the employer of choice for work- ers in their industry. By looking beyond immediate, short term results and focus- ing on strategies to make their compa- nies successful for the long-term, they

recognize challenges sooner, identify solutions more quickly and deliver re- sults ahead of their competitors. In short, they learn to lead at a higher level.

A clear warning sign that your busi- ness is trapped in a short-term mindset is the presence of an "either/or" philoso- phy. Managers either believe they can achieve profitability or they can develop a great workplace, but not both. These leaders don't always take morale and job satisfaction into consideration. Their focus is only their financial bottom line. From there, it's a short leap to the false notion tlrat making money is the sole reason to be in business.

A NEW APPROACH Contrary to the either/or philosophy, leading at a higher level requires man- agers to embrace a "both/and" approach. In great companies, the development of people is of equal importance to finan- cial performance. As a result, the focus is on long-term results and human satis- faction. Accordingly, great companies begin by both creating and nurturing a

vision of the future, and then measuring progress against that vision.

There are three questions to ask, which represent the main components of a corporate vision. By focusing on these questions, companies are more likely to ensure they don't lose sight of their path to success. They are: • What business are you in? This will help you identify your company's signif- icant purpose. • What will the future look like if you are successful? • What guides your behavior and deci- sions on a daily basis? This will help you identify clear values.

Great companies keep al! three of these ideas clearly in mind and make necessary course corrections when they realize they are off track.

The next step is to create a corporate culture that both reflects and reinforces the corporate vision. The culture con- sists of the values, attitudes, beliefs, behaviors and practices of the organiza- tion's members. Culture is an organiza- tion's personality, and it can help or hin-

der an organization looking to achieve greatness.

Many companies develop a corporate culture over time, but if it wasn't active- ly sculpted wilh the company's long- term vision in mind, it may not reflect tlie company's ultimate mission. When organizations seek greatness, they often find that aspects of their organizational culture need to be changed.

Certainly, values are an important part of the company s corporate culture, but it is not enough to simply identify what those values are. Great companies zero in on their top three or four values and rank them to help botli management and the work force make the right decisions. Ranking the list is essential, because val- ues are sometimes in conflict. Wben con- flicts arise, people need to know which value should take priority. For example, if you value financial growth, but integrity is your core value, any activities that could lead to financial gain must first be checked against your integrity value.

THE ROLE OF TRAINING Once great companies establish a long- term corporate vision and have identi- fied and ranked the three or four values that help make up corporate culture, the next step is to develop and implement a comprehensive, integrated training pro- gram. Businesses that consistently invest in training outperform their competitors in both good and bad times.

Without committed and empowered employees, companies can never achieve greatness. Employees learn by example. Managers can't treat their employees poorly and expect them to treat cus- tomers well. Part of treating employees well means providing them with high- impact training programs. These need to be aligned with specific, measurable goals that are fully supported and in alignment with organizational objectives. Without this continuous learning, em- ployees cannot develop tbe skills and atti- tudes needed to succeed.

A successful training program has the following components: • Top management buy-in - Nothing

derails a performance-improvement ini- tiative faster than a lack of support from the leaders in an organization. However, getting this support means convincing executives of the return on investment of the training.

• Demonstrated tangible value - Senior leaders (and training parti( ipants) want evidence that any new training initiative is going to result in new skills tbat positive- ly impact the organization's bottom line. • Follow-up/reinforcement - The compa- nies tbat are the most successful spend lo times tbe amount of effort reinforcing the training they deliver as opposed to moving on to the next initiative.

LEAP TO GREATNESS A segment of RR Donnelley's business that was, until recently, known as Banta provides an excellent case study ot a company that made the leap to great- ness by following the steps outlined above. The Minneapolis-based business provides catalog production services including prepress, printing, binding, list- processing services and distribution.

In 2004, tbe organization found itself challenged witb issues of overcapacity in an uncertain market and an industry that was shifting from traditional offset printing to digital and Web-based solu- tions. In addition, margin pressures, increased costs, competition and a silo- structure mentality amplified the organi- zation's problems and prevented team- ing, process improvement, innovation and customer focus.

The company assembled a team ot consultants and trainers to provide solu- tions for its situation. An analysis soon revealed Banta's employees couldn't d e scribe the company's core business beyond "printing catalogs" or "making a profit." Furthermore, tbey were out of touch witb their role in the company and that of oth- ers. The solution was to create a corporate culture in which every employee's action was guided by a set of shared values.

Management crafted a new corporate vision: "To deliver quality, on-time mer- chandising solutions that drive our cus- tomers' success." It incorporated new val-

ues into the employee-evaluation sys- tem, and developed slide shows and a brochure to show examples of behaviors that supported Banta's stated values.

"These values became our compass," former Banta President Mark Deterding said. "They needed to guide each and every decision we made and every action we took. No matter how tough it was some days, we knew it was essential that senior leadership set the tone and walked the talk. And we asked every individual to hold us to these values."

The company also conducted training that supported and reinforced the appli- cation of its values in the day-to-day business of the company, It asked each department to relate bow its work sup- ported the overall mission of the compa- ny and contributed to its success. Com- pany leaders participated in special training to help them get the most from themselves and their employees.

THE PAYOFF The results were impressive. Soon after completing its organizational assessment and training, profitability had increased 36 percent and employee retention had improved 17 percent. Recruiting and training costs for new employees de- creased. Surveys also showed employee engagement improved 20 percent in the first six months, and employees actively looked for ways to cut costs and improve the work environment.

It's hard to argue with numbers like this. Banta truly made a commitment to a both/ and proposition - that it could combine profitability with a long term corporate vision and an investment in people. Busi- ness leaders should take a close look at their own companies to see whether their visions need correcting, or if they're tnily on the path to long-term greatness,

Scott Blanchard is executive vice presi- dent of client solutions with The Ken Blanchard Cos. He is also a co-author of Leading at a Higher Level: Blanchard on Leadership and Creating High Performing Organizations. For more information, visit vmw.kenblanchard.com or call 800-728-6000.