Hanna Hasl-Kelchner: [00:00:00] Business strategy execution process looks easy on paper, but when you start to follow your plan and put it all into action, stuff happens, hiccups happen, and you don’t always get the results you’d like to get now. Today’s guest can help us zero in on how to smooth those speed bumps. He’s an expert in helping organizations get to where they want to go. And when we come back, we’ll talk about how you can drive strategy to get results without taking detours.

 

Announcer: [00:00:28] This is Business Confidential Now with Hanna Hasl-Kelchner helping you see business issues hiding in plain view that matters to your bottom line.

 

Hanna: [00:00:40] Welcome to Business Confidential Now, I’m your host, Hanna Hasl-Kelchner, and today’s guest is Sean Ryan. Sean is a world-renowned business consultant, speaker, trainer and executive coach. As the founder of Whitewater International Consulting he’s worked with international companies such as Disney, Nucor, Steel, FedEx and many more.

 

Hanna: [00:01:02] With more than two decades of industry experience Sean is highly regarded for his ability to guide organizations through complex, transformational change in what he describes as a world of perpetual whitewater.

 

Hanna: [00:01:16] Sean is also the author of the book Get in Gear: Seven Gears That Drive Strategy to Results, which is perfect. So welcome to Business Confidential Now Sean

 

Sean Ryan: [00:01:28] And I thank you. Glad to be here.

 

Why things go wrong in the strategy execution process

 

Hanna: [00:01:30] Glad to have you. I’m going to dispense with the small talk and go straight for the gusto. In your experience, why do so many organizations come up short in translating their strategy into real results? Where do they go wrong?

 

Ryan: [00:01:43] Well, sometimes it’s really just bad strategy. They haven’t thought carefully through who their customers are, how they distinguish themselves in the marketplace, what makes them unique, what causes customers to choose them versus choosing somebody else. And it really, it applies whether it’s a for profit or not for profit organization. But that’s really a small percentage of the time.

 

Ryan: [00:02:07] Most of the time, organizations don’t execute because a lot of the things that we talk about in the book. And in the book, we identify these seven gears that we’ve experienced over time that keep organizations from really being able to execute well. We break it up into a couple of categories.

 

Seven areas that impact the strategy execution process

 

Ryan: [00:02:31] One is, the first category or the foundation or the environment gears, there are three of those. But those are right, right, right. Having the right people in the right roles with the right capabilities.

 

Ryan: [00:02:43] The second of those performance environment gears is the organization aligning the organizational architecture. So we talk about the systems, the structures, the processes and the culture and making sure that that’s aligned to your strategy.

 

Ryan: [00:02:58] And then the third is around creating a culture of communications, so being able to communicate up, down, sideways, diagonally, hold the difficult, tough, high conflict conversations. And some of that starts with building that culture and having a culture of trust so that when we are holding tough conversations, we know that it’s because we care about each other and we’re trying to do the right thing.

 

Ryan: [00:03:23] And then we’ve also identified these four performance gears, which really they’re designed to align the performance of every person in the organization to the strategy of the organization. So they’re relatively simple concepts, but we don’t necessarily execute on them all well all the time. So

 

Ryan: [00:03:44] The fourth gear is making sure everybody has result oriented goals that align to what the organization wants to accomplish. And then the next gear is around having visible scorecards so people can see how they’re performing relative to those goals.

 

Ryan: [00:04:05] The next gear is identifying the critical performance drivers, which is kind of big fancy language, but what it really means is identifying those critical behaviors or tasks that people need to do to be able to hit their goals.

 

Ryan: [00:04:19] And then the last gear is the glue that holds everything together. We call it follow up, follow through. And in that gear, we talk about, first of all, generating learning. If we’re not on track with what we’re trying to do, why are we not on track? But then also creating accountability for both performance, for generating results, and for playing well within the organization’s value set. And so organizations come up short because something may be broken in any one or more of those seven gears.

 

Where the strategy execution process often goes wrong

 

Hanna: [00:04:55] Which one of those gears gets jammed up most often?

 

Ryan: [00:04:59] Well, they all get jammed up at some point in time. But the place we like to start and the one that seems most simple, but for whatever reason, we don’t do it particularly well is the fourth gear around result-oriented goals. It seems really simple.

 

Ryan: [00:05:20] People ought to have goals. What we find is a lot of times people don’t have goals and what they describe as their goals, even if they do have goals, tend to be more activity-based stuff “I do,” not “results I’m supposed to deliver.”

 

Ryan: [00:05:37] And so we’ll often start with an organization, and this is simple for anybody in any organization of any size, whether it’s two people with a little startup in a garage or a midsize company that’s really trying to grow to a mega corporation or a mega corporation, is just have the performers write down what they believe their top three to five goals are. The top five goals. And then have their managers, their supervisors, whatever, write down what they think the performers top five goals are.

 

Ryan: [00:06:12] So you’ve got to list of five. That should be about what the performer is supposed to accomplish on a day in and day out basis to execute, to organize the company’s strategy. The two lists of five ought to match. But what we have found over literally thousands of repetitions is that on average, about two out of five actually match, which means 40 percent of the time people are working on the stuff that are maybe important to the strategy 60 percent of the time they’re working on other things.

 

Ryan: [00:06:46] And so that’s a simple place to start, because if you can fix that one, first of all, we get better alignment between what people are doing and what they’re supposed to be doing. And then secondly, if we’re still not getting the results we want, then we can begin to look at the other gears and see which ones of those are most broken. So that’s always a great place to start, get alignment around the goals.

 

The problem with activity-based versus results-oriented goals

 

Hanna: [00:07:13] That’s interesting. I’m just wondering if you could elaborate a little bit about the goals versus the activities. So you’re suggesting that people are just spinning their wheels, doing like mindless work, like busy work, that that doesn’t go anywhere?

 

Ryan: [00:07:29] It’s not necessarily mindless all the time, but it can manifest itself as busy work. So here’s a classic. We crossed paths with a lot of salespeople. When we ask them what their goals are, they tell us I’ve got to make 10 sales calls a day or 50 sales calls a week. Well, that’s an activity-based goal. I can go out and I can make it a lot of calls and never deliver one unit of sales, never bring in one customer.

 

Ryan: [00:08:02] On the other hand, if we reframe their goals into a results-oriented goal, that might be just make up a number going to increase our unit sales from one hundred thousand a quarter to one hundred and twenty-five thousand a quarter by the end of 2020. Well, now we’ve got a starting place. One hundred thousand units. We’ve got an ending place, one hundred and twenty-five thousand units in a time frame. We’re going to do that over the rest of this quarter.

 

Ryan: [00:08:33] Now do salespeople have to make sales calls? Yes, but now it’s not going to be mindlessly what a colleague of mine called one-time mindless cow pathing just going from customer to customer to customer. Now I have to think about where am I going to get those incremental twenty-five thousand units from who are the best customers, who are the most ready and likely to buy? How do I manage my pipeline so that I get to the customers who are ready to buy some sometime in the next quarter? Now, it’s not mindless activity. It’s very focused and directed activity.

 

Hanna: [00:09:07] Ok, I maybe I give some people more credit than I should that if they’re in sales, the goal is to make the SALE, not go through the motions of pretending to call on customer. I’m sorry you lost me on that. I mean, I understand what you’re saying and I believe it happens. It’s just disappointing that someone could think that they could just go through the motions without delivering.

 

Ryan: [00:09:34] Sure. Well, let me let me give you another great example, customer service example, where we are working with a customer service department and they had goals for their customer service reps, which was to handle so many calls per hour. OK. Again, it seems like a good idea. The more calls you can empower, the more customers you take care of. That seems like that ought to be a really good goal.

 

Ryan: [00:10:00] But what we found was because they were under so much pressure. To handle a certain number of phone calls per hour, what they would do is if they were falling short of the goal, they would they would literally pretend like there was a technical difficulty on the line and hang up on the customer mid-conversation. The customer has not gotten resolution to whatever the reason was that they called and the customer service reps would hang up because they were being pressured on this activity goal handle, say, 50 calls an hour, whatever that might be, versus delivering great customer service to the customer. However, we might frame that up and measure. And so those kind of activity goals are lurking all over the place.

 

Hanna: [00:10:54] Well, that’s a good example, because somebody probably had to wait 20 minutes to get through to that customer service at first and was just thrilled to be cut off. But, you know, that begs the question about, you know, not all goals are created equal. And frankly, some goals are just stupid.

 

Ryan: [00:11:11] Some goals are stupid . . .

 

Hanna: [00:11:13] . . . weren’t expecting that one were you? [laughter]

 

Hanna: [00:11:22] Let’s just pick a number out of the air. I mean, and sometimes I mean, I’ve seen this especially in very large organizations. The pressure comes from the top increase by X percent. Well, the market or whatever isn’t realistic for doing that type of thing. So you’re creating a number that people . . . That is really an impossible goal. Well, that’s a great way to motivate people, right?

 

The critical importance of follow-up and follow-through to the strategy execution process

 

Ryan: [00:11:44] Right. Absolutely. And so that kind of gets us to that point we talk about in follow up – follow through. A lot of people would go straight to the accountability part of follow up- follow through. And look, accountability is important. Great performers love accountability. And, you know, they like to see us distinguish between great performance and mediocre performance or the person who really is a great team player in an organization, that values team players, team players versus the person who is wreaking havoc. So accountability is important.

 

Ryan: [00:12:17] But the first part, follow up- follow through in our mind is to generate learning. Look, they’re going to be times that we’re going to set goals that are unattainable. You think about the goals that people might have had coming into 2020 in January, early February, up to maybe the 1st of March, and then everything falls apart with Covid.

 

Ryan: [00:12:37] Well, I can’t hold somebody accountable for sales targets, for performance targets, for profit targets, whatever it might be when the whole world changes on us in the second week of March in 2020. So we have to generate the learning first. And now that’s an extreme circumstance. But there are all kinds of things that happen in markets with competition, with technology, with changing customer needs and expectations, where we have to be willing to rethink the goals if necessary, to make sure that people have the opportunity to hit the goals that we set for them.

 

Tips for how to have difficult conversations to improve the strategy execution process

 

Hanna: [00:13:14] That’s fair. That’s fair. You did mentioned something earlier that piqued my curiosity about communication. You need to have an environment where there is enough trust to have those difficult conversations that have to be had at times, because whether it’s changing goals or somebody not living up to expectations for one reason or another, any suggestions about some dos and don’ts?

 

Ryan: [00:13:41] Absolutely. The first starts with the foundation of creating that environment of trust and respect. Right. So we talk about it as a culture of communications. It doesn’t magically happen. We have to, as leaders in organizations, we have to actively work to create a culture where people do trust each other, respect each other. A great friend of mine who actually led a . . . he worked for me for a while, he left my company and went to work for another company where he became the president of the company as a relatively small business. He grew it from a four-million-dollar business to a forty-million-dollar business to a four hundred-million-dollar business until it got sold off a couple of times.

 

Ryan: [00:14:25] But he describes it as a leader: “I mean, you no harm.” And his intent behind that statement is, I’m going to create an environment where you have the opportunity to come to come to work and do great things every day. I’m going to do everything I possibly can to support that success. We are going to have tough conversations occasionally. But I mean, you no harm. It’s always with the best intent of helping you be the best so our organization can be the best. So kind of it starts with that mindset.

 

Ryan: [00:14:56] There are a couple other things that are built into the organizations that have great cultures of communications. One is it’s not a need-to-know mentality, but it’s who else needs to know. So if I’ve got a piece of information, I shouldn’t be sitting there thinking I’m only going to share it with you, Hanna, because if you need to know, if you don’t need to know this, I’m not going to share. My mindset needs to be who else needs to know? Do you need to know? And who else in the organization needs to know what I want.

 

Ryan: [00:15:23] I want to share information as widely as I possibly can so people making decisions have the information they need. We also like to see organizations practice two up, two down communication. So if you get more than two levels in the organization, if you practice two up, two down, what it means is all information penetrates the invisible marshmallow layer.

 

Ryan: [00:15:46] If I’m communicating two levels down that I know the level . . . I’m finding out what the people who report to me directly are communicating to their teams and what their teams are communicating back. And I know whether information is working through that membrane that that person or that that level of the organization or not.

 

Ryan: [00:16:07] And then as we’ve kind of talked about a little bit in organizations that are really good at communicating, they don’t shy away from the tough conversations. We’ve got this environment of trust and respect. We all know the intent is to do the best thing we possibly can for the organization. So when it’s not, when we’re not doing the best thing. Was that something in my way as a frontline performer? There’s a stupid policy procedure or process? I’ve got a piece of equipment that’s not working? My information technology is not working for me the way it needs to be?

 

Ryan: [00:16:43] I can share that with my peers, with my bosses, and we can get resolution. We have ways to close those loops and get resolution quickly. Or if I’m a leader or a peer and I need to have a tough conversation with one of my other peers or with a direct report, we don’t hold back. We have strong professional ways to hold those conversations, but we hold the conversations and not create some kind of short term, long term tradeoff where I don’t give you the feedback you need. And a small problem manifests itself into a really big problem sometime in the future.

 

Hanna: [00:17:17] They have a way of doing that.

 

Ryan: [00:17:20] Yeah, yeah. I mean, it is the ability to just call it for what it is and not hold back. So, you know, we like to call it . . . there are a few things that go into really being able to hold those difficult conversations.

 

Ryan: [00:17:39] One of the things we suggest for people is the idea of mastering the first 30 seconds. If I’ve got to have a difficult conversation with you, I want you to know what that conversation is about within the first 30 seconds of the conversation. So that sometimes what we do is, I’ll put a put a nice phrase on it, we call it the mud filled Twinkie, where I’m going to have a tough conversation with you, Hanna. And I start off by saying a whole bunch of really nice sugary things. And then in the middle of the conversation, I drop in some mud, some stuff that’s kind of ugly and things we need to work on and things maybe I think that you need to do better. And then I finish the conversation with more sugar-coating stuff on the outside.

 

Ryan: [00:18:24] What happens in that conversation is because the way we all tend to filter information, we filter in things we like and find pleasant that we agree with and we filter out things that we don’t like and don’t find pleasant, then what you remember is the really sugary coating I put on the front end and the back end and completely miss the muddy part in the middle.

 

Ryan: [00:18:47] So we encourage people we work with that if we’re going to have a tough conversation, I want you to know what that conversation is going to be about within the first fifteen to thirty seconds. So you know that we’re talking about that part where I think something needs to change about your performance or how you’re interacting with other team members. So that would be one key to holding these difficult conversations.

 

Hanna: [00:19:10] Well, that’s great advice, Sean. You know, I have to compliment you on your colorful phrases, the mud filled Twinkie. I’ve typically heard that phenomenon that you described and attributed to that phrase as a sandwich. You know, the good, we bury the middle and then, you know, but the mud filed Twinkie is definitely quite an . . . and now get that idea out of your head. Right.

 

How the “marshmallow layer” can derail the strategy execution process

 

Hanna: [00:19:35] And the other thing I wanted to ask you about is the marshmallow layer. Tell me about this marshmallow layer.

 

Ryan: [00:19:42] Sure. I first I first discovered it early in my career. I started with a large corporation in California. And over the seven years that I was there, had lots of mobility. One day I would be talking with front line team members, there’s a twenty-eight-thousand-person company, and there may be a couple of days later, I’m talking to executives. Just kind of the nature of the roles that I was in often.

 

Ryan: [00:20:06] And what I was struck by was an organization going through lots and lots of transformational change at that point in time. And I was really struck by how we talk to frontline team members and they would talk about the need to deliver better service to customers, get the bureaucracy out of the way, get the stupid rules, policies and procedures out of the way so that they could be more efficient. And if they did that, they felt like we could earn more money for our shareholders.

 

Ryan: [00:20:32] And then a couple of days later, I’d be talking to senior executives and they would talk about the need that we really have to make it easier for our team to do. Well, we’ve got to get the bureaucracy out of their way. We’ve got to deliver better returns to our shareholders. And so the language was strikingly similar. But the things that I was really struck by was the messages were also completely disconnected. What the senior executives were talking about was never permeating down to the front-line team members and the challenges and the issues that the front-line team members saw and had to deal with every day were never permeating their way back up to the senior executives.

 

Ryan: [00:21:14] And we didn’t have a better way to describe it other than to call it this marshmallow layer, this kind of gooey mass in the middle of the organization where literally no one was intentionally withholding information but information could still not permeate through that. So the marshmallow was just a spongy mass that absorbed the energy of the information.

 

Hanna: [00:21:40] Yeah. Kind of draw the life out of everybody on both ends of the spectrum. That’s an interesting phenomenon. And I’m just wondering, you know, in terms of strategy and a growing business, it’s one thing when somebody is small, they know all their employees, it’s easy to manage. But at some point, even these large organizations were much smaller. And yet the marshmallow came up like a mushroom. So how can a small, midsize growing company keep that from happening? Because when information, important information gets bottled up like that, it really can stymie the growth. Any suggestions on that front?

 

Tips for better communication

 

Ryan: [00:22:25] Absolutely, first, communicate as often as you can in many different ways as you possibly can. And part of that, we have lots of great technology today, but we also can’t let the technology substitute for human contact. So, you know, being out face to face with the team and obviously in a small but growing organization, you can’t do that every day. You’ve got other priorities.

 

Ryan: [00:22:52] But being out in front of the team and connecting with people personally as much as you possibly can when you’re in those environments as a leader or an owner of a small, midsize entrepreneurial business, I call it hearing the question or the statement behind the statement. When somebody asks you a question, often they’re not asking directly the question they really want to ask. There’s something that lays behind it.

 

Ryan: [00:23:21] So having the empathy to hear what lays behind the question or the statement that somebody is making or asking one more question, just to make sure that you’re hearing what people are really trying to share with you. Part of it, too, is, again, listening in many, as many ways as possible, thinking all the different ways. So that might be holding occasional team member roundtables where it’s a pretty much open forum and people can talk about anything that they want to talk about. They can talk about the issues they face, the challenges they face so that you can surfaces and resolve them.

 

Ryan: [00:23:57] A relatively small business I was in recently in every work area, the department team, they had a whiteboard where if somebody faced any kind of an issue, they could just wander over to the whiteboard. They could jot on the whiteboard the issue that they faced. And literally every couple of days leaders came through. They looked at the items on the whiteboard and they typically resolved those items on the spot.

 

Ryan: [00:24:26] Every item was put into one of three buckets. Either let’s change it right now or we can’t change it because here’s what the consequences would be. So that wouldn’t make any sense. And that was relatively very small percentage of the time anything goes into that bucket.

 

Ryan: [00:24:44] And then there were a few things that went into kind of this middle bucket, which was this seems like a really good idea, but we need to study it more before we make a decision. So what that taught the team, what the team learns very quickly is always going to be heard. There’s not some mysterious black box that I’m trying to communicate to. I’m putting stuff on this board and people are going to sit down with me within the next couple of days and we’re going to resolve the stuff on the board. So those kinds of things can help keep people connected, regardless of how large the organization grows, too.

 

Hanna: [00:25:16] I like that suggestion. It beats the suggestion box, which sometimes gets filled with God knows what and is intended to be kept empty, not because they’re resolving issues, because they don’t want to hear about them. I know I’ve been being a little cynical here, but I like that white board idea because it’s very visible and you can’t hide from it.

 

Ryan: [00:25:40] Yeah, yeah. You can’t hide from it. It’s out in the open. Right. And I love suggestion boxes too, you know, because they’re always dusty. I’ve always wondered why in a lot of organizations when they have the suggestion box, why do they put locks on them? You know, what’s that point of that stuff?

 

Hanna: [00:25:56] So nobody knows. It’s a secret.

 

Ryan: [00:26:03] Alex just walks over there and he just put something in the suggestion box. What was it? Somebody go break the lock off. Let’s see what he . . . And usually it’s an empty gum wrapper.

 

Hanna: [00:26:12] Yeah, exactly. Exactly. Because we don’t want trouble makers.

 

Ryan: [00:26:16] Right. Absolutely.

 

2 Most important take-aways from Get in Gear to improve your strategy execution process

 

Hanna: [00:26:18] Now, your book, Get in Gear: Seven Gears That Drives Strategy to Results, what are one or two things that you hope readers would take away from that book?

 

Ryan: [00:26:27] The first thing is that whole idea of playing that game. When we call five on five, if readers read that and they just get people aligned on the goal, think about that. If 60 percent of the time people are working on the wrong stuff. I know you like to talk about the hidden things that are right in front of us that can help businesses improve a lot. There’s one right there. You just get people better aligned to the strategy and the goals of the organization. You’re going to be better off. So that would be one takeaway.

 

Ryan: [00:26:58] Second takeaway is there are seven gears that connect strategy to resolve. But one of the things we discovered and it didn’t really connect for me perfectly until I was writing the book, which is: you don’t have to fix all seven gears at once. You can fix one gear if you just look at your organization and think about which one is most wobbly, or start with that result-oriented goals gear and then after you get it fixed.

 

Ryan: [00:27:25] Then you start thinking about what other gear might I fix next so that the gears are actually, I guess, technically severable. You can pick one, work on it, fix it. It’ll spin a little bit better, then you can figure out what the next one is. And that, I think, is a great idea in any size organization, but in particular in small and midsize businesses. We don’t have the resources, the time, the energy to fix everything all at once. But if I fix one thing or a little bit better this week than we were last week, then next week I can fix something else and it will be a little bit better then. So I think that’s a major takeaway.

 

Hanna: [00:28:03] Very good, because incremental improvement is still improvement and a lot of times we like to go for the big brass ring, but it’s not necessary. So I think that’s a very valid point. And, you know, and hearing you talk about the book and the recommendations and suggestions during our conversation, it sounds like it can actually help cultures and organizations become more resilient in coping with change and perpetual chaos. Would that be a fair statement?

 

Ryan: [00:28:30] 100 percent true. We all are dealing and I named, and you said in the introduction, I named my company Whitewater International Consulting, because we’re all dealing with perpetual whitewater. Now I named the company back in 2001, not even beginning to anticipate, and I always thought it was a great name for a company. We watch organizations go through, you know, perpetual Whitewater and markets from competition, technology, economic changes, all that kind of stuff. But if we didn’t think that was true before, we know it’s absolutely true now.

 

Ryan: [00:29:06] So organizations have to be adaptable. They have to be resilient. So the better we execute our strategy now, the more resources we create, the more capabilities we create in the organization and the better our financial bank account is, our financial balance sheet is, our balance sheet is with our customers, our balance sheet is with our team members. So when radically weird, tough times do hit, we are a little bit more agile, a little bit more resilient, and we can respond better and quicker to whatever those circumstances are.

 

Hanna: [00:29:41] If you’d like to contact Sean to learn more about improving your business strategy, execution process, or his book, Get in Gear: Seven Gears That Drive Strategy to Results, you can find that information in the show notes at BusinessConfidentialRadio.com. And if you know someone who could benefit from Sean’s information and his advice, be sure to tell them about it and leave a positive review on your podcast app or at lovethepodcast.com/BusinessConfidential.

 

Hanna: [00:30:11] You have been listening to Business Confidential Now with Hanna Hasl-Kelchner. Have a great day and an even better tomorrow.