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Blog of Strategic,General and Financial Management (English/Spanish)





Strategycorner is now expanding its content to include posts about General Management, Financial Management, Finance Transformation, Marketing and HR Management. Posts will be published in English or Spanish.


At the end of the blog there are different charts about Strategic Management in Spanish. In the archive area you could find a lot of posts about strategy and its execution in English/Spanish.

Jesús Peral
Executive MBA IE Business School, Madrid,Spain


Master in Strategic Management
IDE-CESEM Business School, Madrid, Spain






Find at the end of blog all charts related to Strategic Management topics commented in the posts







Mapa Estratégico Genérico/Strategy Map

Mapa Estratégico Genérico/Strategy Map
Mapa Estratégico Completo

Modelo de Dirección Estratégica/Strategic Management Model

Modelo de Dirección Estratégica/Strategic Management Model
Modelo desarrollado en las entradas 1 a 100. Ver archivo del blog
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viernes, 7 de julio de 2017

Developing people: my modest experience


If you have led teams in your career it is likely you have thought your “inventory goes up and down in the lift”. Why? Because your main resource, let´s say, your working capital was your people. Money matters but he human beings who work for you and the organization matter even more.

In this post I would like to share my modest experience in developing people. I have always learnt from my prior senior managers, from a pragmatic view, to regard people as an investment. Their value increases as they become more effective in their roles and capable of taking on greater responsibility. In accounting terms, as I have worked as Finance Director and other finance managerial roles for many years, people may be treated like any other asset on the balance sheet, taking into account acquisitions costs and their increasing value as they gain experience. Until here I am not discovering America again!!!

But, which is the manager´s contribution to effective training? In my experience I could mention several ways you can contribute to the effective training of your team, as follows:

·         Determine the standards of performance required for each of the roles you control

·         Analyze the competences relevant to the achievement of these standards.

·         Agree with the individuals concerned what these standards and competences are

·         Review with these individuals their performance so that agreement can be reached on any gaps to be filled between what they can do and what they should be able to do.

·         Treat every time you give someone an instruction as a training opportunity

·         Allow for the learning curve. Don´t expect too much, but do require trainees to improve at a pace which matches their natural aptitudes.

·         Train and develop by example. Really important. Give people the opportunity to learn from the way you do things.

·         Remember that the core responsibility for training and developing your team rests with you.

·         Plan the training of your team in accordance with a regular review of their training needs

People learn mainly through experience. So it is worth spending a little of your time planning the experience of anyone for potential for development.

Planning someone´s experience, means for me, giving him/her extra tasks to do which provide a challenge or extend him/her into a new role. It could be a project which he/she has to complete or he/she could be included in a project team looking at a new development or problem which cuts across organizational boundaries. Projects which enlarge experience in unfamiliar areas are particular useful in my view. Planned experience will work better if it is accompanied by coaching so that those undergoing it can receive the maximum benefit from your expert advice.

The final piece is coaching. The best way to learn how to manage is to manage under the guidance of a good manager. Coaching is an informal but deliberate way of providing this guidance. It should be linked to performance appraisal.

But coaching is a more continuous process. Every time you delegate a task to someone and discuss the outcome you are presented with a coaching opportunity. When you delegate you can provide guidance on how the job should be done. When you discuss progress with your collaborator or when he/she reports back to you, you can ask questions on how well he/she has thought through what he/she is doing, suggest alternative ways of looking at a problem (but don´t provide the solution, je je) and provide constructive criticism if things are not going well.

So, based on all the above, remember, you can help to develop people by discussing higher-level problems with them, involving them in your decisions and increasing their understanding of how to tackle a job senior to the areas for which they are responsible. This is part of my experience so far.

jueves, 4 de mayo de 2017

What do we need a leader for ?


In this post I would like to comment about leaders and leadership sharing my experience in one of the companies I have worked for based on the analysis of what happened and how the local CEO faced the situation.

In the year 2001 my company was involved in the launch of a new product. The worldwide marketing plan required a huge investment in trade and consumer marketing. The Senior Management team had great expectations in terms of volumes and profits. The competitive landscape was very difficult. All the teams were aligned to achieve a common goal. The finance department was ready to support sales and marketing efforts by managing credit limits, inventory levels and working capital investment.

The sales and distribution plans were very aggressive in terms of placement reaching new channels never used before. Financial projections were created assuming different scenarios but in all of them the expected results showed good margins and profitability.

3 months after the launch the results were really disappointed. The sales graphs did not show the expected sales levels with a dramatic downturn in different countries and also on a by customer basis. The local CEO and the international management team were really concerned.

The above situation could be familiar for a lot of the readers of this post. The main difference probably derives from the reaction and behaviour of the local CEO to cope with this situation.

The local CEO reacted very quickly to the downturn in sales. His reaction not only was a reaction of responsibility but also very sensible. Instead of adopting a defensive attitude, he accepted the reality.

One of the main elements of his success was his capacity to communicate with the marketing team as they felt it was their failure. An executive of lower level could have blamed and get away from the problem. But he understood their reaction and communicated with them very openly.

So what is the key message from this? It is fundamental to integrate all departments in a team effort to get the best possible result. The local CEO was able to assume the responsibility and take advantage of the potential errors. He faced the facts as they were using his emotional intelligence. He was very talented to get the best out of his team, helping them to develop and improve. His sincere interest in the others led to create a real sense of loyalty. He fostered a sense of sincerity encouraging all the employees to be open and honest with him. You could discuss with him and tell him you were not in agreement. He did not like cowards. He was especially sensible in assigning the right member of his team to the particular projects. The learning here is, the leader, ultimately, has the responsibility about what to delegate and to whom because if you choose the right person, at the end of the day, it is likely you will succeed. This also shows us the importance of the management of emotions in the leadership to be closer to the success when taking decisions. The emotional intelligence helped the local CEO to find the solution to the failure.

So what he did? Firstly, he assumed the error as his thing and did not blame his team but he considered them as part of the solution. He transformed the emotions into a source of information. The decisions need to incorporate emotions to be real. The good decisions take into consideration the emotions as a sign of respect for the people. The affective results end very close to the effective result. I think, nowadays, effectiveness depends more and more on the affection.

The emotions do not happen by chance, they follow a logical order that activates and deactivate them. They exist, we just need to find and organize them when needed. Obviously this requires some kind of effort. The idea here is to identify the emotions first, then understand them and finally channel them to the action.

In my opinion the leader of the 21st Century is no longer isolated in concrete areas as now he/she has to intervene in all the processes and is the cornerstone of the example of attitude, as he/she decides and acts, creates values and expectations. It is really the reflection of the change in the organizations.

The effort of the leader consists of understanding how to coordinate the company value in two directions: value creation for the shareholder and added value to the organization through strong policies of internal and external quality able to create quality of life. The increase of productivity is linked to the innovation in the ways of managing and leading the organization. New ways associated to the talent, involved in the creativity, understanding technology as a way for progress and continuous improvement. This task to link with the future has to be managed, from inside, by the leader with the expectation to overcome critical situations.

Lead the organization in the 21st Century means to manage successfully the competitiveness, trust, quality, culture, knowledge, behaviour, compromise and change.

The importance of the leader lies in the security of his/her behaviours. The 21st Century requires leaders emotionally stable. The leader needs to create the culture of the team, the culture of the organization, without overshadowing the capacity of each person in the common effort.

It is necessary to foster the direct leadership that impact in the knowledge of each member supporting the leader. This leadership requires compromise with the team, led and managed by the leader so he can inspire, motivate, listen, demand and analyse the decisions in depth, encourage the achievement of goals and cooperate in the development of his/her teams. For all of these it is required a great capacity of communication and adaptation.

The competitive advantage of the emotional leadership is the individualised treatment of the talents and the global knowledge of the activity. You cannot retain a talent if you don’t know the determinants and circumstances around the work. Only this way you can recognise the effort and the employee can be aware of it.

The emotional leader follows his/her people. He does not expect people follow him/her. He/she engages them giving example of coherence. Join the efforts to achieve a common goal and avoid using “we” and “they”. He ensures every employee feels passion for his/her work and for the company they work for.

You might get several learnings from the above. For example, the team is beyond its members. The responsibility has to be shared by all. We need leaders in all the teams and leaders that can train others leaders, and the most important, to teach then to understand none of us is worth more than the sum of all.

 

martes, 18 de abril de 2017

I am not your boss but a friend who is always right


Should we complain and tell our boss what we think about him/her? This post is about this.

 

In many occasions we are unhappy with our work and with our boss. This situation leads us to consider telling what we think about him/her. But sometimes we need to know in advance what it is advisable to say before making a big mistake.

Talk with full sincerity to our boss, telling him or her all what we think is a very risky relief, above all if we don’t find the right moment, way and place.

Normally, this sincere impulse hastens due to lack of tune or for the permanent conflict with your manager. It might be your boss does not get along with you and you are aware of it.

It is also possible you were not meeting the expectations, he sees you as a threat or you always disagree with him/her.

You could use different strategies depending on the reasons. You can leave the company or you could also survive coping with the situation until you find a new job but you cannot fight this attitude of rejection as if nothing happened. Therefore the solution is to complain or be honest and tell what you really think.

It is true that if the company where you work monitored your performance based only on your achievements you should not be worried about talking honestly and openly. But honesty turns out to be, in many companies, an act of suicide.

A very important advice would be, never do this in front of a big audience. The negative feedback has to be commented in private and the positive in public. This is a rule of thumb.

It is very important to be focused on the objective errors and avoid the personal view. In addition, you should propose your own alternatives and solutions to the potential mistakes of your manager. But you have to take into account that your boss could make the mistakes in particular circumstances and give a positive view to your critics by analyzing how he/she resolved them.

In my experience if an employee has the right skills for a job but shows lack of loyalty it is likely this is more important. So if you doubt it is better not criticizing and get some lessons for the future.

Based on the above the question is what to do to get anything positive? The important thing with your complaint is you don’t have hidden agendas nor has no substance. In addition it should be concrete as you are aiming the things change.

The decision to be honest with our manager entails our arguments have to be based on facts. We have to avoid judgements and interpretations clarifying what are our actual needs. But very important as well is to know how he/she feels with us so we could use the complaint to know what he/she expects from us.

Finally, to be honest does not imply to be fully transparent and tell the first thing that comes to our mind. You need to understand the circumstances and do an objective analysis.

Ideally the perfect situation is when you are fully aligned with your boss so you have discussed openly what you expect from him and what he/she expects from you. This trust is the base for the future relationship and normally leads to a higher performance and mutual satisfaction.

But remember, regardless what I have commented above, there is a second rule of thumb, Never tell your boss what you think about him/her. But it is up to you.

 

 

viernes, 18 de noviembre de 2016

Conflict management


Who did not find, was in the middle of a conflict or had to resolve one in your professional career?  You will not escape conflict in your organization or work environment. In my view it is inevitable. Mainly because the objective, values and needs of groups and individuals in any organization do not always coincide.

In my view, sometimes, conflict may be a sign of a healthy company. Boring agreement on everything is unnatural and debilitating. There should be fight of ideas about tasks and projects and disagreements should not be suppressed. They should come out into open, because is the only way in which you can ensure that the issues are explored and conflicts are resolved.  This post is about managing the conflicts or better to say trying to manage the conflicts.

Every reader could have his/her own experience and way of resolving the conflicts he/she was involved or he/she saw in his working environment.

You can use, let´s say, a peaceful co-existence where you aim to smooth our differences and emphasize the common ground. It is well known we are encouraged to learn to live together. There is a good deal of information, contact and exchange of views and individuals move freely between the different teams, for example, between your headquarter and the affiliate or between sales and marketing departments. This is a pleasant ideal but it may not be practicable in many situations.

It is also known that conflict is not necessarily resolved by grouping people together. Improved communications and briefing groups could be a good idea but are useless, in my opinion, if management has nothing to say that people want to hear. And there is also the danger that the real issues, submerged for the moment will surface again in the future.

Other possibility is to get compromise. In this case the issue could be resolved by negotiating or bargaining and neither party wins or loses.  In this situation there is no right or best answer. Agreement only accommodates differences. As you can imagine real issues are not likely to be solved.

Based on the above the best approach would be to find a genuine solution to the problem rather than just accommodating different points of view. And as I said before sometimes conflict situations can be used to advantage to create better solutions. This situation has to be generated by those who share the responsibility for seeing that the solutions work. So what would be the sequence of actions in this case? First, those concerned work to define the problem and agree on the objectives to be attained in reaching a solution. Second, the group develops alternative solutions and debates their merits. Third, agreement is reached on the preferred course of action and how it should be implemented.

The conclusion could be that conflict is in itself not to be deplored. It is an inevitable concomitant of progress and change. What is to be disapproved is the failure to use conflict constructively. Effective problem solving both resolves conflicts and opens up channels of discussion and cooperative action. Take this into account in your next situation!!!!

miércoles, 2 de noviembre de 2016

Team building


In this post I would like to share my experience in one of the most difficult tasks you face as a manager, executive or when you have responsibilities for the results of teams whatever is the level or the environment:  team building.

We spend a lot of time leading teams and leading with people in groups. Getting people to work well together is as important as motivating individuals, in my opinion.

Team building is a matter of establishing mutual confidence and trust among all the people working in your team. You should aim to create a feeling, let´s say, of interdependence. In my experience a good team feels shared responsibility for getting results.

A lot of readers, in managerial roles, know very well that people do not necessarily work well together. Personal and interdepartmental rivalries exist in the vast majority of companies. It is likely you agree with me with this. But you need to look for them or they can ruin the most brilliant groups.

So what´s is the point? Good teamwork is essential. To become an effective team builder it is useful to know and understand the behavior of the members of your team.

Normally you can find what I could call formal and informal groups. The first one are groups that are created by the company to achieve a defined purpose and normally are aligned with the organization needs. The second are set up because they have some affinity for one another. In this case the group exists to satisfy the needs of its members.

For me, the ideal situation, would be for both groups to coincide so they will satisfy the needs of both the organization and the individuals in it.

One of the most important things to look for in groups is the status system that may exist within them. If you understand the informal as well as the formal hierarchical order you will be better equipped to deal with problems within the team.

Your aim, and this is really difficult and a stressing task, is to create an effective team. You need to create a vision, engage the members to become cohesive, self-supportive and finally show them where it is going.

But the question is how can we know we have or we are creating a real effective team?

My thought is you should look for some features as follows:

·         The atmosphere tends to be informal, comfortable and relaxed.

·         The task of the team is well understood and accepted by the members.

·         The members listen to each other. Very important, indeed.

·         There is disagreement and the reasons are carefully examined. This is essential in my view.

·         Most decisions are reached by a kind of consensus.

·        Criticism is frequent, frank and relatively comfortable. In other words, there is little evidence of personal attack either openly or in a hidden way.

·         When action is taken clear assignments are made and accepted.

·         The leader does not, normally, dominate it.

The readers can think other features based on their experience. The above are just mine.

The final ingredient is your capability to lead, in other words, your leadership.  The role of the leader is critical, especially nowadays, when we are in times of crisis so it is when the group must get into action fast.

Within this role of leadership you must look for getting cooperation. The members of an effective team cooperate equally will with one another and of course, with the team leader.

But are there methods for team building? This is not an exact science. You should develop your skills based on your experience and by observing other managers or executives, within or outside your organization and learn from them. This will allow you to create your own management and leadership style.

So, in my experience, you need to demonstrate to your team:

·         You know where you want them to go

·         You know how they are going to get there

·         You know what you expect each member of the team to achieve

·         And you know what you are doing.

When you have done the above you are ready to:

·         Encourage participation in agreeing objectives and targets

·         Rotate jobs within your team so that the team members identify with the reams as a whole rather than with their own jobs.

·         Ensure that communication flow freely within and between groups

·         Encourage informal meetings between your team to resolve problems.

And finally, if you are a member of a team and you want to work effectively within your group you would need as follows:

·         Understand the purpose of the team

·         Find out what you are expected to contribute

·         Analyze your own skills and competences to establish how you might best contribute

·         Prepare yourself well before meetings. For example, get your facts and arguments at your fingertips

·         Don’t talk too much. Think about this, the art of being a good team member is to know when and how to intervene.

·         Assess your own performance as a team member. Ask yourself what you are good and not so good at doing by reference to your successes and failures, and  take appropriate action.

And remember,  the team makes you and not the opposite ¡¡¡

viernes, 21 de octubre de 2016

How things go wrong and how to put them right


It is likely that a lot of professionals in the different areas of the finance function have experienced the stress when things go wrong. Things go wrong because people do less than they are capable of, misuse their resources or choose an inappropriate time or place in which to do it and normally the situation is misjudged and the wrong action taken.

In this post I would like, again, to share some experiences and suggestions to cope with the situations some people might face in their daily professional activities and even in their personal lives.

First of all, let me remember the well-known and so called Peter´s principle. Dr. Peter suggested that in a hierarchy, individuals tend to rise to the level of their own incompetence. In his experience system encourages this to happen because people are told that if they are doing their current job efficiently and with ease, the job has no challenge and therefore they should be promoted. It is also true, in my view, that this principle has only been accepted as common manner of speaking as it reflects a fundamental problem when assessing potential. We know or we think we know that someone is good at his present job. But does this predicate success in the next move up? Perhaps yes, perhaps no. However we cannot be sure because the skills needed by, for example, a scientist are quite different from those required by a leader of the research team. In other words, technical competence does not necessarily indicate managerial competence.

First thought, can we beat the Peter´s principle for us? The answer, in my opinion, is yes. But with difficulty, of course. Why? Because people don’t usually refuse promotion!! If they do, they become suspect. When you read this post probably you will remember your own experience, your friend or your colleagues, being in the same situation. Am I right? However it is perfectly reasonable to check on what is involved if you are promoted. You should get precise answers to questions on what you will be expected to achieve and more importantly the resources you will be given to achieve it and the problem you will face. If you think these demands are unreasonable discuss the job to see if they can be modified.

In my view, don’t take a job unless you are satisfied that you can do it or at least that you can learn how to do it within an acceptable period of time. And don’t forget to find out if your predecessor failed and if so, you can ask what went wrong so that you can avoid making the same mistakes.

Second thought, can we beat the Peter´s principle for others?  Well, if you are in a position of offering a promotion or a new job, you have to take into account the Peter´s principle and how to avoid it.  You need to match the capacities of the candidate to the demands of the job. So you need to analysis the skills required. For example, managerial, analytical, technical, communications etc. And then, measure the candidate against each of these criteria. This matching process should identify any potential weaknesses.

A lot of readers will know very well the typical sources of incompetence and it is likely they have seen some typical situations as follows:

·         Conservatism, for example, the typical “that’s the way it always worked. We have been market leaders for the last 10 years, why change? Familiar with this?

·         Rejecting information, what did you say about our losing market share? I don´t believe. The market research surveys are always inaccurate.

·         Indecisiveness, we need to think a bit more about this. We need more information. Let´s call a meeting next week to look at the pros and cons. Familiar right?

·         Obstinate persistence, don’t confuse me with the facts. That’s the way is going to be.

·         Scapegoating, it´s not us, it´s the rate of exchange. The government policies are killing us.

·         Suppression of news, don’t tell them about how well we are doing. They only ask for more money.

·         A belief in “mystical” forces, I just feel in my bones we must do this thing. From a CEO I worked with many years ago.

Hence see below my summary about why things go wrong (normally):

·         Inability to learn from mistakes

·         Pure incompetence through over promotion

·         Poor selection, inadequate training

·         Over confidence

·         Under confidence

·         Laziness

·         Lack of foresight

Every reader will have their own experiences, anecdotes and clear view about why things go wrong for them or for the companies they work but I am almost sure that some will coincide with the above mentioned. If not, let me know.

 

lunes, 26 de septiembre de 2016

Achieving results


All of us are facing the pressure to achieve results in our professional activities. Achieving results, getting things done, making things happen. That is what management is all about in my opinion.

In this post I would like to take the manager´s view to share some thoughts based on my experience and the learnings I took from this experience.

You can find different kind of managers. For example, those who make things happen, those who watch things happening and, let´s say, those who don’t know what is happening. Ideally the focus should be in making things happen as the best way to succeed.

But let´s consider some questions to be answered:

·         Is getting things done simply a matter of personality which some people have and others haven´t? For example, drive, leadership, ambition…

·         And if you don’t have the drive, leadership and so forth which it takes, is there anything you can do about it?

·         Finally, to what extent is the ability to make things happen a matter of using techniques which can be learnt and develop during your career?

In my view, personality is important. Unless you have determination and drive nothing will get done. But we need to remember that your personality is a function of both nature and nurture. Your experience is the critical element together with education and training.

We cannot change our personality easily but we can develop and adapt it by learning from our own experience and by observing and analyzing other people´s behavior. That’s why is so important to absorb all the best from your superiors and colleagues to create your own management style and become a real achiever.

In terms of the techniques for achieving results, I would mention planning, organizing, delegating, communicating, motivation and controlling. For sure, you can learn all of them. But in my view these techniques are only as effective as the person who uses them. They should be applied in the right way and in the right circumstances. And don’t forget you still have to use your experience to select the right technique and your personality to make it work.

To become a person who makes things happen you have to develop skills and capacities by understanding, analyzing and learning so my recommendation would be as follows:

·         Understand what motivates and inspires achievers.  For example, the personality they display in getting things done.

·         Observe what achievers do. For example, how they operate, what techniques they use

·         Analyze your own behavior, just to stress behavior, not personality. Compare it with that of high achievers and think how to improve your effectiveness.

·         And very important, learn as much as you can about the management techniques available in every moment. In other words, be updated in all of them.

Probably one of the most difficult things is how to analyze your own behavior. I faced this problem in a lot of occasions. It is no good to analyze your own behavior unless you have criteria against which you can measure your performance. So you have to set standards for yourself and if you don’t meet them, ask yourself why. I have also used this approach many times. The answer should tell you what to do next time. As an example, the basic questions you could ask yourself could be as follows:

·         What did I set out to do?

·         Did I get it done?

·         If I did, why and how did I succeed?

·         If not, why not?

 The aim is to make effective use of your experience.

Based on all the above the question is what do achievers do? What I have seen in a lot of high achievers and I have tried to replicate in my personal career, are things like these:

·         They define to themselves precisely what they want to do

·         They are prepared to discuss how things should be done and will listen and take advice. But once the course of action has been agreed they stick to it unless events dictate a change of direction.

·         They work hard and work well under pressure.

·         They are never completely satisfied with their own performance.

·         They normally take calculated risks.

·         They are enthusiastic about the task and transmit their enthusiasm to others.

·         They are able quickly to sum up situations, define alternative course of actions, and suggest to their collaborators/colleagues what needs to be done.

·         And finally, they continually monitor their own and their collaborators performance so that any deviation can be corrected in good time.

As a conclusion, I would say, the process of observation, analysis, and learning will help you to become an achiever. But remember, achieving results is ultimately about making promises, indeed, to others and to yourself, and above all keeping them.