Key Sustainable Indicators (KSI)

In an article in the Independent newspaper, http://tinyurl.com/nwvgg9l; issues have been raised around the excessive use of water in creating commodity food products and why corporations need to take note on the excessive use.  I was startled to read that, “Each slice of toast consumed in Britain, for example, has taken up 240 litres of water in its production. It takes 1,000 tons to produce a ton of wheat and 16,000 tons for each ton of beef.” 

This is truly a staggering amount of resource to create basic products and who knows how much is used to create other staples.  It is generally accepted that water is no longer (or perhaps never was) an inexpensive product and service to create and we are all paying for this in our monthly utility bills.

The article suggests that organizations should record the true costs of production within its corporate filings.  This is an interesting idea to consider and though it may not get formal nor universal acceptance, it should be considered further as a concept.

There is almost universal acceptance around using Key Performance Indicators in its role in delivering an organization’s strategic intent.  So how about having Key Sustainable Indicators (KSI)? They would include key measures of activities that allow an organization to move towards its sustainable targets, both in the short and long-term.  In the case of the article above, water usage could well be a suitable KSI and strategic goals would be created in identifying how to reduce its planned usage.  To achieve the target it may involve becoming simply increasing efficiencies or innovating to reduce usage.

Should these goals be published or not?  There is no binary answer to this.  If they are published, it is open for public consumption and may provide an insight into the competitive nature of the organization.  Perhaps a good first step is to have a suitable set of internal indicators to work towards. 

If selected:

  • Ensure that they are understood and communicated to all employees (and other appropriate stakeholders) as to why they have been selected and how they will allow sustainable goals to be achieved.
  • They are SMARTR (Specific, Measurable, Realistic, Time-bound and Reviewed).  Simply selecting a measure is not enough and they should be periodically reviewed to ensure that they are fit for purpose and still relevant.
  • That not too many KSIs are selected.  Have too many and they will be difficult to maintain and manage.  Have say between 5-7 KSis.

Positive / Negative Feedback – Or Just Feedback?

Hackman and Oldham (1976) * identified five factors that enable a person to enrich their job and role:

  • Using a number of skills during the task
  • Completing the entire task rather than segments or small components
  • Understanding the impact of the task on the key stakeholders, both internally and externally to the organization
  • Providing the task holder with increased decision-making and autonomy in completing the task
  • Increasing the feedback provided during and after the task

Regarding feedback, is it positive or negative?  It is neither.  It is what it is, an observation of someone’s behaviour or performance. Good feedback should be given as soon as an event occurs – not at the end of the year during a formal appraisal session. 

Before we can either give or receive feedback between two individuals, there has to be a relationship between them.  If this does not exist then the feedback will not be internalized, or at worse, seen as an attack on someone’s character.

* Hackman, J. R., & Oldham, G. R. (1976). Motivation through the design of work: Test of a theory. Organizational Behavior and Human Performance, 16, 250-279.

The Impact Of Social Spaces On Working

I am currently writing this entry on a plane in the cramped coach class, where frankly using a laptop is hard work and being creative is a challenge  in such limited space.  It got me thinking about offices and how they go about using their social spaces.  If an office provides a social space (water cooler, coffee-making area, lunch space) what is the function and purpose of the space?  Of course, people need places to simply congregate, talk about their weekends and social transactions, but perhaps we could use them for other purposes…

We have two forms of knowledge: explicit (knowledge that can be codified and tacit (knowledge that can not); knowledge that sits inside of our heads.  Examples of tacit knowledge include (knowing how to tie up your shoe laces, making a great sale, creating your favourite dish).  We need to create opportunities and work spaces in which tacit knowledge can be transferred between colleagues and this is where office social spaces can help.

I visited one company in the UK where they had a fabulous coffee area.  It was large with a great espresso coffee maker; the back wall had a plasma screen with rolling news coverage.  The seats were comfortable and came in all sorts of bright colours.  All in all a great place to sit back, relax, share knowledge but – this was for a space for customers only.  The coffee area for the employees was a bleak area, cramped with a solitary sink and racks of mugs.  This certainly was not a place for hanging out, sharing knowledge.  It was a grab and go back to your desk, kind of place.  I did think that this was an opportunity missed.  In contrast, I went to an engineering office in Sweden where they had a large red comfortable sofa by the lunch area, with wifi and hot-desk facilities.  I made by hosts aware of my astonishment of the facilities, quietly wondering if anyone want back to their desks and do any work.  They responded that they wanted employees to sit together either individually or as teams and share knowledge in a comfortable space. 

We live in a world full of tacit knowledge.  We need to adopt strategies that allow this tacit knowledge to be shared amongst colleagues.  Rather than providing dreary coffee and lunch areas, make them into extensions of the work environment, rather than adjuncts.

Innovation Through New Voices

Gary Hamel . “Strategy Innovation and the Quest for Value.”
Sloan Management Review. Vol. 39, No. 22 (1998). pp. 7–14. suggests that in order to create an environment that thinks and seeks innovation, new ways, practices and methodologies, it needs to create five preconditions in the organization:

  • New voices: Creating an environment in which all can participate and are encouraged to offer insights, ideas, challenges to the status quo.  We are not all located in the same room, leave aside the same building, so this presents a challenge to an organization operating in the virtual environment.
  • New conversations: The development of dialogue at all levels in the organization looking at the known through new lenses. Asking ourselves why and seeking leaner, practices, products and services.
  • New passions: Giving the employees a stake in their future, motivating them to contribute and rewarding them for their inputs.
  • New perspectives: Get the team to look at the known through new lenses.  Perhaps we have simply missed the blazingly obvious.
  • New experiments: We should try new approaches, and if trialled at small-scale, what do we have to lose?  It it does not work, then study the lessons learned and use them in the future.  If it works, consider scaling up.

I have always been of the opinion that real change is simply the accumulation of small change.  Perhaps we need to use Hamel’s approach to create new approaches within our teams, departments and ultimately our organizations.

Considering Goals And Their Impact Over Time

My definition of what the aim of an organization is to “maximize returns for its stakeholders” .  But over what term?  When we say short or long-term what does this mean and what are the implications for sustainability?

I started thinking about this when reading a HBR article “Capitalism for the Long Term: by Dominic Barton: http://hbr.org/2011/03/capitalism-for-the-long-term

If you take a typical business, what does long-term mean?  Three to five years?  This defines the strategic planning activities, allocation of resources, finance initiatives etc.  What about a ten or twenty year timeframe?   This is typically unheard off in the West, but pretty much par for the course in the East, for the larger organization.

So how do these fundamental views of outlook impact sustainability?  If we use the definition of sustainability as being the capacity to endure (http://hbr.org/2011/03/capitalism-for-the-long-term), then having a short-term outlook (you decide what short-term means for you) will shape your view on all activities including the purchase and utilization of resources including materials, people, machines etc.  It shapes your finance initiates.  Is the organization seeking suitable short-returns that may increase its exposure to risk, in the pursuit of these returns.  This will shape an organizations approach to sustainability and all activities associated with sustainable practices.  

By its implicit nature, sustainability has a long-term outlook.  If we take the Bruntland Commission of the United Nations, March 20th, 1987, view of sustainable development as being the “the development that meets the needs of the present without compromising the ability of future generations to meet their own needs”, then a long-term approach is certainly viewed here.  So what happens when you are driven by the short-term?  The very nature of the markets in which you operate may dictate this and take this out of your control.  If the outlook is short-term, then what impact does this have on the sustainable considerations, your organization may be considering?  Are the organization goals at odds with each other (short-term metrics such as profit and growth versus long-term goals as sustainability)

Barton’s article focuses on the West near obsession on a short-term outlook and if we were able to adopt and consider a longer-term outlook, perhaps this would create better foundation for creating and sustaining growth, profits, allocation and utilization of resources, financing activities, use of personnel.  

If you are driven by short-term goals and measurement indicators, yet want to have a long-term sustainable outlook, what are you doing to maintain balance?

Core Values

If you are UK-based, you may not of heard about Zappos.  They are a fascinating online retailer and a book has been written by Tony Hsieh, Delivering Happiness.

Zappos website states explicitly there values – a message for their internal employees and externally to the environment in which they operate. They include

  • Deliver WOW Through Service
  • Embrace and Drive Change
  • Create Fun and A Little Weirdness
  • Be Adventurous, Creative, and Open-Minded
  • Pursue Growth and Learning
  • Build Open and Honest Relationships With Communication
  • Build a Positive Team and Family Spirit
  • Do More With Less
  • Be Passionate and Determined
  • Be Humble

These are strong, powerful values.  If you examined them you will probably determine your own “favourites”.  From a leadership perspective, I like “Embrace and Drive Change”.   We live in a world that is constantly shaped by change.  Change creates its own challenges and managing change it becomes a high priority for many organizations.  Will the rate of change slow down? 

“Pursue Growth and Learning”.  How will organizations differentiate themselves from their competitors unless they create new products and services which can only be achieved through a continuous program of development from within.  A Results Orientated Work Environment (ROWE), follows this principle.

“Be Humble”.  This is should permeate throughout the organization at all levels of management and is a personal value that comes from within. 

Virtual Management

Management is a well-studied art in a co-located environment, but what about in a virtual and remote setting? 

Imagine you are work in London with a team of five, two of which are in Bratislava and the rest in Mumbai.  How do you ensure that the team operates effectively?

Face the issues: time zones, culture, distance – balancing work and home life.  Are you prepared to get up early, work weekends, be a slave to your mobile device so that you get the tasks completed?

What training have you been given for this?  How well prepared are you?  How has your organization prepared you for?  Your technical skills are not being questioned but ask yourself what additional skills do you need to operate successfully in a virtual setting.   

I can not find a lot of formal academic resources on this subject but there are plenty of organizations operating this way.  Blogs and personal insights provide a good insight.  I do like leadingvirtually for good insights into virtual working.

Effective Communications

I have worked with numerous organizations, (large and small, for profit or not for profit) and often observe issues concerning communication or more precisely the lack of communication.  These issues occur both internally (vertically and horizontally) and externally (with key stakeholders such as suppliers and customers).

Communication represents a large sack filled to the brim with a range of issues and covers both how messages are packaged, delivered, received and interpreted.  The richest form of communication remains in the face-to-face mode, but now due to the breadth of tools available, we have at our disposal many means of communicating to individuals, and groups, regardless of the physical location.  Though a wide range of tools exists, we often neglect matching the right tool to the message (though I would argue that it should be the message to the right tool).

Communication is an art and science, that is often overlooked and frequently taken for granted. When it does not work, it becomes one directional. When it works, it is bi-directional and rich. It connects us emotionally allowing us to complete tasks with focus, operate as a team and deliver results. But this rich mode of communication takes both consideration and time, which we appear to be short off on a daily basis.

Communication is at the heart of everything we do and deliver, whether it is setting a vision, building and maintaining trust or shaping our personal brand. It influences everything that we represent and being an effective communicator is a key function that an Executive Leader must master. It is the way that we externalize (and therefore make available to others) what is going on internally for us. We need to create our own authentic and effective leadership ‘voice’.

In our Navigate – Executive Leadership Journey (2015), we address the following questions:

  • What is effective communication and how do I maintain this effectiveness through the variety of communications tools at my disposal?
  • Why do I need to communicate as an Executive Leader? Shaping communications at a high level ensures that good communication skills cascade through the organization.  Otherwise it will erode the way it behaves and operates.
  • How do we all communicate effectively and what tools can be utilized to maximize my personal effectiveness, and the effectiveness of my organization?
  • What if we are unable to shape the communications within my organization?  Poor communication can become the catalyst of many problems and issues impacting the organization and can we afford not to improve and optimize how we communicate?

Managing Performance

Managing staff performance is the core duty of all managers.  But how do you do this?  The process often has a bad name and is heavily focussed on appraisals and the processes.  This is not managing performance.  Performance is all about jointly managing success so that the organizational aims and goals are achieved.  It is highly reliant on good relationships and a proactive approach between the manager and the individual.

Performance management is often seen as a formal process consisting off:

Planning for the year: Reviewing the past year and setting new goals and objectives. (Often the past is not reviewed, but this is a great source of lessons learned for the manager the individual and the team).

Mid-year reviews: An opportunity for the manager and the employee  to review progress, identify road-blocks and ensure that objectives are achieved.

End of year review and appraisal: If as an employee, at the appraisal stage, you are told something that you were not aware of (in terms of your performance), ask yourself why? Regardless of the feedback, why are you being told this at this point?  Imagine it is praise and appreciation, why receive it at the end of the year and not when it occurred?  The appraisal is an opportunity to reflect back on what happened and identify the gaps between the planning and its delivery.  It also becomes the input for future goal setting.

The key for managing performance, from my perspective, is not these three stages, but actually the continuous feedback, coaching, review and mentoring, that occurs between the employee and the manager throughout the year.  This can occur formally and informally, and informally and should occur as and when it occurs. 

If performance is managed well, it acts as a motivator to all.  It is at the heart of good managerial practices. 

Sustainable Business Management

Sustainability by definition is the capacity to endure… 

Let us take this global definition and apply it at a micro level within an organization and look specifically at the act of management.  The number one reason why someone leaves their organization is not financial, but their manager, specifically the relationship between the employee and the manager that becomes corroded over time and eventually leaves the employee with the determination to leave.  How sustainable is this

When an employee leaves, there is a brain drain – a knowledge loss from the organization.  The act of hiring is expensive and takes time to incorporate a new team member within the team.  Also pre this process, if someone wants to leave, as a result of the employee / manager relationship, they become unmotivated, and this can spread within the team causing an opportunity cost to the teams effectiveness. 

Management is a responsibility, not a right.  Managers have to do many things on a day-to-day basis to get the most from their teams.  But what is the goal of a manager?  For me it is simple, to make others succeed.  A manager does not achieve success on his or her own, the team does.  Their goal is to create the operating environment that enables the team to be successful, both individually and collectively.  They have to embrace and execute a number of key skills on a day-to-day basis.  This includes delegating, coaching, leading, delivering, planning, dealing with conflict and managing it, communicating proactively, handling goals from above and below and prioritizing and organizing resources (human and physical).  The list goes on, but it does emphasize the wide array of skills that they need to develop, without necessary formal training and guidance. 

What happens when someone is given the responsibility of being a manager but is not able to develop these skill sets to make their team successful.  They are unable to deliver results and can create damage to the fabric of the team.  How many times have you seen a manager be elevated to the position of a manager, because they have risen to the top of their technical abilities, and in order to keep them, they are given a management path which in essence is a career in its own right.

To apply sustainable business practices, we need to train, mentor and develop managers in how to manage and lead their team, regardless of whether this is a local or global team.  To deliver organizational sustainability, we need individuals, teams, managers and leaders to develop their staff so that they can endure and contribute to not their own individual success, but also that of their organization.  For me, sustainable business management equals good management practices.