1 minute guide to running effective meetings
I don’t know how much time ineffective meetings lose annually, but I bet it’s a huge amount (and people complain about Twitter!). There are few things more irritating than having to constantly go to meetings where you are often not needed, decisions are rarely reached, and if they are reached not acted on.
Amazingly running effective meetings is incredibly simple and the little extra effort saves you ten-fold. If I had to pick one thing that would immediately increase a company’s productivity by 10%, it would be effective meetings.
So, how do you do it?
1. Think carefully who you invite - do they really need to be there?
2. Always write an agenda, explain why the meeting is necessary and what the end aims are. Some meeting ideas will die naturally at this point! Circulate the agenda with the meeting request so people that feel they have nothing to add can opt out in advance.
3. At the start of the meeting, reiterate the aims of the meeting, and think about how long you need to dedicate to each agenda item to get through the meeting in the allotted time
4. Make sure only one person speaks at once, and that they do not go on for too long. This generally requires a chair, and it can’t be a chairperson that exploits their power to go on and on about their own points.
5. At the end of each agenda item make sure you record what decisions have been taken, what actions result from those decisions, who is responsible for delivering them and by when. Take this opportunity to think about who else in the company will be affected and make sure they are informed.
6. Schedule reminders to follow up on the actions to make sure they have happened.
It really is that simple.
1 minute guide to boosting initiative and innovation in your team
Everyone wants to have a team working for them that they can trust to get on and do the job, be full of new ideas, and not come to them every five minutes asking for help or approval. Some people naturally develop their teams this way, most of us have to work at it.
Some key things to watch out for
1. Make sure you recruit the right people in the first place. If you do not trust them from the beginning, you’ll watch them too closely, give them too much instruction and stifle their creativity. This is a vicious circle, because you do not trust them, you micro-manage, because they are micro-managed they don’t feel free to be creative.
2. When people come to you with suggestions, be very careful how you react. Maybe you’ve thought about their idea before and decided it wouldn’t work. Maybe you’ve tried it and it didn’t work. If your first reaction is to tell them that, they will just feel that you dismissed it. Listen to their suggestion carefully, ask them questions about it, check there isn’t a new angle you might have missed, then explain why you think it might not work, and listen to their response.
3. When you set out your plans for something new, do you ever get dissenting voices? These people are not necessarily being negative (although they might be), so listen carefully and make sure you understand why they are saying what they are saying. Often it takes great courage to tell the boss he is wrong, so these people may be your best staff, as they are showing they really care. If you never get dissenting voices, it is more likely that you have effectively taught people that there is no point dissenting than it is that you are right all the time.
4. Make sure that when people do something new that you recognise it – either directly to them or publicly (or both) – even if it didn’t work that well (provided it didn’t work well because it turned out not to be a good idea, not because it was poorly implemented).
5. When setting strategy, set principles and outcomes, not processes. If you set processes, people will just do what they are told even if it is not achieving the desired outcome. If you make people responsible for outcomes, they will innovate to achieve them.
Effective communication for improving team performance
I attended an excellent course recently run by Cambridge Leadership. The key thing the course teaches you is that most people do not communicate in a way that is likely to get results when they are trying to correct underperformance. Managers either dress the criticism up with some praise e.g. “you’ve always done such good work, but you really need to improve in this area” or they just openly criticise. Neither way is the most likely to get the desired result, but obviously works in a number of cases.
The key thing you need to do is to get the person to accept that their performance was not up to scratch, and to do that you need to also make sure that it really was sub-standard. Once they accept that they have underperformed, you can start a productive discussion on how to sort it out.
The mental tool they suggest is to frame the meeting as follows.
1. Do not start with anything other than the problem issue. State the problem clearly, and explain why you think it is a problem. This is done in the following way: “It seems to me that you are not achieving {whatever it is}, because I have noticed /heard/been informed {whatever your evidence is}”.
2. Make sure the stakes are clear. Is this something that if they do not correct will affect their ability to stay in the job? Will it affect pay rises or performance bonuses? If the person does not understand why they need to improve, they won’t try that hard.
3. Ask them what they think about what you have just said, and listen properly. If they have reasons that would excuse the poor performance, then fine. If not, and if they do not say that they accept that what they did was less than what was expected, you need to start again at 1. and make it clear why you still think it is their responsibility.
4. Once they have accepted responsibility, then ask them how they plan to get back on track. It is much more effective if they come up with the plan than if you impose it on them
Why do recruitment agencies charge so much?
Recruitment agencies are a solution to a market inefficiency. To see clearly the problem they solve, let’s look at a simple example. A small firm wants to hire a financial controller, they only need to hire someone in the finance department every few years, but in order to fill that job with a good candidate they would need to do several adverts and see lots of candidates, incurring huge costs. The costs for a recruitment agency would be about the same, but they can pass the good candidates on to a number of different companies – a more efficient system.
Unless you are recruiting a huge number of the same type of people, recruitment agencies are a good solution, so why don’t all companies use recruitment agencies all the time? It all comes down to cost. Recruitment agencies are often too expensive. If you have a high margin business and ensuring you always see the best pool of candidates is your main priority you can bear these costs. If you do not have such high margins you may have to compromise on quality.
This begs the question of why the fees are so high if the agencies are creating market efficiencies. The answer is that in order to win business from employers, they need to employ large teams of sales people. Because they need to cover the wages of these sales people, they need to charge high fees. This in turn distorts the market – the successful agencies are likely to be the ones that are most effective at promoting themselves. They may also be the ones that are best at attracting the best candidates and matching them with vacancies, but they might not be.
Despite predictions of the internet revolutionising the recruitment market, recruitment agencies have not been disintermediated. Now, however, on both sides of the Atlantic new services are springing up that could solve this problem. BountyJobs in the United States and Talent Puzzle in the United Kingdom are two examples of companies using web 2.0 concepts to create market efficiencies in the recruitment market.
By providing a web-based tendering platform for sourcing recruitment agencies, they bring the jobs directly to the agencies, lowering the cost of acquiring new clients, and by allowing employers to rate the agencies, they make the market more efficient by enabling other employers to identify the best agencies.
The end result is that the incentives are aligned in the right direction for both parties. The agencies have less of an incentive to focus on selling themselves and more of an incentive to focus on identifying and matching the tight candidates. Less focus on selling means lower costs, which in turn means lower recruitment fees.
5 mistakes commonly made by start-ups
1. Recruiting the wrong people. It is amazing how easy it is to do this, and equally amazing how huge the impact on your company is. You know you need to grow, and you know you need people to do it, just make sure you get the right people. How? Well, it’s not easy, but here are some simple rules to start with.
a. Write a detailed spec for the skills and experience you need and make sure that you wait until you find someone that ticks all the boxes. If you are not clear from the start, you’ll find yourself interviewing someone you really like and persuading yourself that they would be great.
b. Always get references. Get two references and do it on the phone so that it is harder for someone to be non-committal. You are not looking for references that say words to the effect of “this was a good person, able to do their job” you want something a bit more enthusiastic than that.
c. Ask them to do some kind of project related to the skills you need. A presentation, a written proposal, some research, what ever is right for you. It’s amazing how this can reveal holes in people’s ability. Remember, anyone can talk a good game.
d. Have clear objectives for the first month and three months and make sure you do a proper review. You really need to be feeling very positive at this stage. If you are thinking that they’ll do, this is not positive enough, and probably means you are hiding the truth from yourself (usually that truth is that you know they are not right, but you really need someone and you think they are better then no one, or you can’t stand going through the recruitment process again (or paying more recruitment fees!)
e. I think it is advisable to get people that are stepping up into the role you are offering - so high on ability, slightly lower on experience. Otherwise you get someone that can get bored quickly and doesn't have such scope to grow with the role.
2. Being focussed on revenue or head count growth rather than profit growth. I don’t know why this is so common, but I suspect it’s because they are easier to measure, and you can show off to people about them more easily. Especially in the early days when you are not making money anyway. Often the same effort put into a relatively small revenue increase from an existing product, market or client can be worth a lot more profit than going after something new.
3. Focussing on what isn’t working rather than what is. You have two markets/products/clients. One is steady, makes a bit of money and not very exciting, the other is full of potential but is tough work. The temptation is to allow the tougher one to take up all the airtime in meetings. Make sure you are looking at what is making you money and focus on how to make the most out of that.
4. Trying to be all things to all people. When you start up, you are full of enthusiasm for your product and you can see all sorts of applications or markets and you feel committing to one could mean losing out in another. Try to remember that it is rare that a company is successful just because it has a great product. More often it is about execution. From a prospective client’s point of view, they need a simple message that is compelling for them. Difficult to do that if you are hedging your bets. If you can not have the position of the biggest/market leader (who can maybe operate in many markets) try to focus on the one or two markets you think are most likely to work for you.
5. Not being clear enough about how you are creating shareholder value, and keeping an eye on the exit strategy. Ultimately you are going to realise the value you have created when you sell the company, at which point the multiple of profit you can command will be critical. There are lots of factors that can affect this multiple, and would require too much space to go it this post, but the key ones are: the size of your margins, are you dependent on a small number of key clients, do you have a strong position in a market place that a competitor would want to acquire, can you get a bidding war going between potential acquirers? Sometimes you need to be thinking that lower profits that get you a higher multiple are a better goal than just doing whatever makes the most money short term.
Good leaders – mentally agile optimists
Recent studies have shown that people who are successful are likely to be optimists. Optimists are found to benefit from being happier, living longer, and being more successful. It also just happens that they are wrong more.
I think people can understand this intuitively, if you don't believe you can make a success of your business idea, you are unlikely to start. The great thing about being optimistic is that if your business does fail, you don't focus on that as you are focussed on the next opportunity.
However, to be truly successful you have to have the mental agility to swap between optimism and pessimism. Blind optimism might easily be called delusional, so you need a balance. If you are too sure your idea will suceed, you'll probably overlook all sorts of problems that could probably have been avoided.
Interestingly people with depression turn out to have very realistic expectations of likely outcomes, so in fact pessimism could just be called realism. It's just because most people are naturally slightly optimistic that they seem pessimists by contrast.
Why start-ups fail – lies, lies, lies
Why do start ups fail? Lots of reasons obviously, poor concept, poor delivery, and poor management being fairly obvious candidates. I've been trying to boil it all down to one reason or theme, and I think it has to be lies. Why lies?
Well, first of all, I'm not saying that start-ups are lying to their clients or investors (or at least not on purpose), but they are lying to themselves. How does this manifest itself? Numerous ways, but here are some examples:
1) Believing your own hype. Obviously you have to sell yourself to generate new business, funding and to recruit good people, but in the process you may stretch reality (estimates of the size of the market, the weakness of competitors, and so on) not in a deliberate attempt to deceive but because you have a powerful vested interest in believing the better figures. The motto believe the best, prepare for the worst is probably worth bearing in mind.
2) Recruiting the wrong people. You know you need someone to do a key role, and you need them immediately to grow and hit your targets. The temptation is to lie to yourself that the person you have seen that isn't quite what you are looking for is good enough, because you really need them. Again, very tempting, but one of the worst mistakes you can make.
3) Telling yourself you are an approachable CEO. Few people want to bring you problems, and few CEOs really want to hear them. If you are running a business you really want to believe that you are doing everything the best and most efficient way. This is rarely the case and other people won't be telling you - don't lie to yourself too. Seek out things that are going wrong rather than looking for things that are going well.
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