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Are Your Company Policies a Constraint?

Postedby Chris Anderson on 04-11-2011

Company policy is used to establish employee expectations so everyone knows what is and isn’t acceptable.  Company policies are the vehicle by which your company defines risks and rewards, but can they also constrain your organization?

Your company policy can be a written document, part of your procedure documentation, or it can be your company culture. We’re all familiar with written policies but…what about cultural policies?

Have you ever said to yourself or to someone else…

“We’ve always done it that way” or “That’s not the way we do things around here”?

If you have, you’re up against a cultural policy. Cultural policies are not written down; instead, they’re passed on by word and behavior. Everyone knows your company’s cultural policy — it’s the set of unofficial rules that all of your employees live by every day. Organizational culture involves more than just socially acceptable dress codes, or the atmosphere in your office — it influences your company’s important decisions, too.

For example, what time is it safe to arrive and leave work? What socializing is acceptable before, during, and after work? People new to your company that do not conform to your cultural expectations might be shunned, embarrassed, or ostracized for not conforming.

Written company policies come from management and can be changed, so while a written company policy may constrain your organization, you can at least change it.

Unlike written company policies, your company culture evolves over time and is not tied to a particular CEO or manager. Try to actively change your company culture and you’ll see a lot of resistance, yet violating company culture and changing the paradigm is critical to any process improvement program.

So we have two different policies.  The first, a changeable written company policy handed down from management.  The second, an unwritten, hard to change, cultural policy that evolves from group norms over time – a paradigm.

Which do you think constrains your organization more?

Gain Customer Loyalty and Respect with Well-Written Policies

Postedby Steve Flick on 02-07-2011

Articles on winning and keeping customers abound on the Internet. They generally focus on achieving and maintaining “customer service excellence“. They talk a lot about tactics but miss the strategic aspects of customer satisfaction and retention.

What drives your customer service (aka, customer relationships), anyway? Your company policy, of course. Your mission and vision drive your overall company policy, in which you lay out your overall objectives that guide your strategic plan. From there come your sales and marketing plans, your operational plans, and so forth. You might think of your policy as a juncture of internal and external forces.

So, why do I bring up this subject? An article appeared last week on “Mashable” that makes a very good point about the importance of a strong, well-written company policy to your customer relationships.  This article explains why no one reads privacy policies, and they cite Facebook and others as examples.

Why don’t customers read privacy policies? The article has several answers, including:

  • The longest privacy policy of the “top 1,000″ websites takes 45 minutes to read at 244 wpm(1); and
  • The average of the privacy policies cited takes about 10 minutes to read.

It’s not just privacy policies, of course — it’s every kind of policy. They’re lengthy, full of confusing verbiage, and put off their audience. They do neither the company nor its customers any good. So, why are wordy, obtuse policies (in “nanofonts”) foisted on customers?

  • In the modern business environment, legal departments owe their employers a duty to protect them. Unfortunately, this is often interpreted to mean “let’s cover every contingency we can think of”. Clarity is invariably sacrificed for thorough attention to detail.
  • Modern culture seems to have promoted discord, vitriol, and revenge over cooperation, conciliation, and harmony. I don’t know where this warrior mentality worked its way into business but being humble and nice is now a sign of weakness. This line of thinking leads companies to draw in and protect rather than be exposed to danger.
  • Companies seem to prefer “customer acquisition” over “cultivating relationships”. They need (or they prefer) the quick payoff rather than the slow-and-sure.

What’s most puzzling is that the last issue persists even though the need for short-term profits is what largely brought about the current global economic recession. When will we learn?

If a company had as one of its stated purposes “to reduce customer goodwill and retention”, they still couldn’t do a better job of driving people to look for alternatives than by writing bad policy. Badly conceived, poorly written company policy is avoidable; well-written policy is a necessity.

“So, what is a well-written policy?”, you ask. It’s a policy that’s:

  • Clear;
  • Concise;
  • Direct;
  • Easy to comprehend;
  • Not written to its audience but written with that audience foremost in mind; and
  • Written with SMART objectives behind it.

What’s your company policy? Does everyone understand it? Does it help your customer relationships? Call or write and let’s talk policy.

As always, thank you for your time.

* * * * * * *

(1)Font type and size have something to do with that figure, as do the complex wording and convoluted syntax common to “legalese”. Naturally, we read faster and retain more of some documents than others (Novels v. Contracts, for example). I recommend checking out these sites and others for more information on reading speed:

Do We Have a “Snow Day” Policy?

Postedby Steve Flick on

An article appeared in today’s online Wall Street Journal (“It’s Snowing. Do We Get The Day Off?“, 4 Feb 2010) that pointed out how vulnerable small businesses are to natural forces than are their much larger business “brethren”, such as Wal-Mart, Royal Dutch Shell, and Toyota:

  • This week’s snow-and-ice storm that swept through the midwestern and eastern U.S.;
  • The floods that have absolutely devastated Australia’s Queensland state; or
  • The earthquake that hit Haiti over a year ago and two major quakes in the last decade affecting parts of Indonesia.

Of course, the large-scale destruction that accompanies some flooding and quakes will be the death knell for your business when your geographic expanse is limited to one office, which is in the flood/quake zone. In those cases, company policy had better include careful risk assessment and ongoing risk management, including major disaster and contingency planning.

Fortunately, most business disruptions are not nearly so large in scope. Like the ice storm that hit us (St. Louis, MO, and parts north, east, and west of us) just about a week ago, a day of down time — or even two or three — might not be critical. We might be able to continue working in the cloud, so our core functions continue whether we’re “there” or not. We can telecommute when the need arises. Having a bad weather policy seems like a non-issue for us.

“Well, that’s just fine for some B2B”, you might be saying to yourself, “but that’s not us.” If our business depends in part on foot traffic — people showing up at our office/storefront to do business — we can’t have workers not show up and expect that to have zero impact on our cash flow, or our company’s reputation. Our customers have come to rely on us to be there for them, regardless of what it’s like outside. If there’s a lot of competition in our area of business, one little “glitch” could send our customers elsewhere.

At the same time, we can’t risk the health or well being of our employees. What do we do?

We establish a “rain day” (or a snow day or ice day) policy, we put it in writing, and we make sure all employees — as well as our customers — know what that policy is. We establish clear, easy to follow procedures to ensure that the policy is carried out and we train all our employees periodically and when the likelihood of the threat is on the increase.

Does your company have an inclement-weather policy? Do you think it needs one?

How Do You Manage Performance Reviews?

Postedby Steve Flick on 11-15-2010

For many companies, it’s that time of year — time for year-end performance reviews. Time to see if we can find our performance reviews from last year, or head over to Human Resources to get a copy. For managers, time to dust off the performance reviews from last year and see if anything’s changed.

If you’re like most of us, you haven’t kept a daily diary of your accomplishments, so you have to construct an account of the last 12 months from long-buried memories in just a few days. You don’t bother listing your close calls, almosts, and never-weres — you need to put a positive spin on your year.

You might go into the review feeling you did a “more-than-adequate” job, even if you can’t quantify it exactly. Then again, you might approach the review with a sense of foreboding. You’re not well prepared. Maybe you feel like you’re going to get slammed. Maybe you wish the shoe were on the other foot. Maybe you wish everybody would just forget about it.

The performance review, as most of us know it, is a broken process. Lately, there appears to be a groundswell of support for the idea of doing away with performance reviews. According to an article in a recent Wall Street Journal, many HR professionals are “frustrated that managers don’t have the courage” to give constructive feedback.

In an interview from July, 2010, UCLA business professor Samuel Culbert said that performance reviews should be dispensed with altogether because annual reviews don’t promote candid discussions about problems in the workplace or their potential solutions.

Going back to 2006, the Harvard Business School’s “Working Knowledge” page ran an article by James Heskett, one of the HBS faculty, in which he called into question the main objective of performance reviews. Professor Heskett asked, “Is (the objective) to weed out poor performers? To recognize the so-called A players? To provide the basis for compensation decisions?” He concluded that we don’t do a good job of establishing or communicating objectives.

W. Edwards Deming, one of the gods of quality, called the performance review one of the “deadly diseases of management“. You’re not going to find a much stronger indictment than that.

It’s been a few years since I’ve had a formalized performance review. The manager in question got much more out of the typical performance review because he always had the performance of the group in mind. He linked my performance to that of my teammates, which helped create and maintain a team ethos.

Unfortunately, his type of performance review wasn’t the norm. Too often, the performance review is an exercise with no apparent purpose, except to satisfy a regulatory requirement or follow a decades-old policy. We go through the motions but don’t accomplish anything. By conducting performance reviews the way we do, we miss so many opportunities for improvement.

We all deserve better from this “process”.

* * * * * * *

I’m currently conducting a performance review poll on LinkedIn. Please drop in (it’ll only take 10 seconds, if that) and register your opinion. Or, post a comment below.

What do you think? Do performance reviews work for your company or your group? Or, do you think the performance review should’ve been retired with the mechanical adding machine and green eyeshades?

* * * * * * *

REFERENCES

FURTHER READING

10 Great Examples of Quality and Leadership

Postedby Steve Flick on 09-13-2010

Chris Anderson, Managing Director of Bizmanualz, recently posted on the Top 10 Quality Gurus. Those of us in the quality disciplines all know about these people: Shewhart, Deming, Juran, Crosby, Ishikawa, Taguchi, and many others laid a solid foundation for quality practices in the 21st century and beyond. Some of us, I’m sure, can recite ISO 9001 from memory, but memorizing the minutiae isn’t as important as “getting it” — applying the principles of quality to our business and personal lives.

Quality is one of the keys to success in any discipline. Though we may use different terminology, it’s clear who gets quality. There are people who get it, who successfully apply the tenets of quality to what they do in life — people who make everyone around them better without having to know a thing about Six Sigma, ISO 9001, or Lean. Some examples are:

1. Yogi Berra, “It ain’t over ’til it’s over.” How many of us have been through a grueling project — like working toward ISO 9001 certification — and, once we reached our goal, said, “Now that we have that out of the way…”? Once your quality management system has been certified, it ain’t over.  There’s no such thing as the perfect QMS — that’s why a major goal is to keep improving. Yogi kept improving his game, all right. You know how many other MLB players have 10 World Series rings?  Zero.

2. Ichiro Suzuki, “In baseball, even the best hitters fail seven of ten times and of those seven failures, there are different reasons why”. Ichiro was referring to a time-honored measure of success in baseball, the .300 batting average. Ichiro has batted over .300 every year he’s been in the American major league. Between Japan and the U.S., he could retire with over 4,000 hits, a plateau only two before him (Cobb and Rose) have reached.

3. Jackie Robinson. “Thinking about the things that happened, I don’t know any other ball player who could have done what he did. To be able to hit with everybody yelling (racial slurs) at him. He had to block all that out, block out everything but this ball that is coming in at a hundred miles an hour. To do what he did has got to be the most tremendous thing I’ve ever seen in sports.” Shortstop and Dodgers’ teammate Harold “Pee Wee” Reese, on Jackie. Enough said.

4. Archie Moore, “If I don’t get off the mat, I’ll lose the fight.” In 234 recorded boxing matches over a span of 30 years, the Old Mongoose won nearly 200, 145 by knockout! He also failed to win more than 30 of his matches. Mr. Moore even won a light-heavyweight match at age 50! Archie Moore personified dedication and dogged persistence, qualities that separate winners from also-rans in business, too.

5. Steven Spielberg. “All of us every single year, we’re a different person. I don’t think we’re the same person all our lives.” Has there been a better expression of the concept of change. Always thinking, always moving forward — that’s why Spielberg is considered one of the best ever at his craft.

6. Miles Davis. “Do not fear mistakes…there are none.” Miles was one of the most innovative composers and arrangers of jazz, a musical genre known for innovation. He was continually reinventing what he did and staying at the forefront, from cool jazz to fusion. Nearly every one of Miles’s albums, from the 1940′s “Birth of the Cool” to the 1980′s “Aura”, represented a landmark in the progression of music.

7. “Dizzy” Gillespie. “I always try to teach by example and not force my ideas on a young musician.” Known as one of the founding fathers of bebop, Dizzy was also a proponent of Afro-Cuban music, decades before “world music” became popular. Never content to rest on his laurels, he was still inventing new ways of expressing himself through music at the time of his death.

8. Wayne Gretzky. “You miss a hundred percent of the shots you don’t take.” The Great One’s career shot percentage was a mere 17.6%; to put it another way, he missed over 82% of the time. Still, Gretzky holds every single-season and career scoring record in the history of the National Hockey League. Just goes to show that you don’t get anywhere by standing around and waiting for something to happen.

9. James Madison. “The truth is that all men having power ought to be mistrusted.” Madison felt power ought to be distributed among the people, so he (and many nameless others) developed the U.S. Constitution to assure a balance of power. They had the foresight — the vision — to craft a document which is still the model for sound government more than two centuries later.

10. Dwight D. Eisenhower. “You don’t lead by hitting people over the head. That’s assault, not leadership.” Field Marshal Montgomery, thought not to be one of Ike’s biggest fans, once said, “He has the power of drawing the hearts of men toward him as a magnet attracts the bit of metal. He merely has to smile at you, and you trust him at once.” That’s saying a lot when someone who doesn’t care for you still respects your abilities.

Of course this isn’t the definitive list of The Top 10 Leaders Not in Quality. I don’t believe any of them ever thought they were perfect, which is why they continually worked on improving themselves. These are ten people who represented quality in what they did or how they lived. They’re living evidence that quality is all around us.

Not every quality guru is in the field of quality. Who represents quality to you? Why? Are they people you know personally?

Crisis Management: 3 Lessons from the Gulf Oil Disaster

Postedby Steve Flick on 05-17-2010

The “Deepwater Horizon” disaster, unfolding in the Gulf of Mexico over the last three weeks, should serve as an object lesson in how NOT to manage a crisis. Here are just a few of the ways in which British Petroleum (BP) and its contractors made a bad situation infinitely worse:

1. You have to have a contingency plan. Whether through willful disregard or naked ignorance, it’s apparent that BP and its subcontractors, as well as the federal government, weren’t ready from the outset to handle the oil rig disaster. Compared with the final tally, which we won’t know until decades from now, the cost to prepare for a worst-case scenario would’ve been microscopic.  Good risk management would’ve helped, too.

2. Someone has to take responsibility. It’s one thing to say something went wrong but you won’t know what for sure until all the results are in. It’s another thing altogether to immediately start pointing the finger of blame at everyone else, as oil executives did before the US Senate in recent weeks. Who made the final decision to undertake the project? Who made the decisions to “do this” and “don’t do that”?  ISO 9001, as well as sound ethics and common sense, dictates that someone at the top must be responsible.

3. Quality is not an inconvenience. The Minerals Management Service (MMS) was not conducting monthly safety testing on the Deepwater Horizon in accordance with federal law. Furthermore, the MMS has reportedly granted drilling permits there and elsewhere without adequate environmental safety reviews.

The most important piece of safety equipment, the blowout preventer, was said to have been damaged weeks before the fateful explosion but not repaired or replaced. Countless other shortcuts were allegedly taken for the sake of time and money.

The sad part is that the parties involved – especially BP – could have easily afforded to take their time and do things right. (The oil business has been hugely profitable over the last five years, right? Well, what have they done with the record profits they earned?)

We all see the price to be paid for haste and carelessness. We can’t afford it.

* * * * * * *

Further Reading:

Why Is Change So Difficult?

Postedby Steve Flick on 05-10-2010

What is it about us that makes change so hard to accept and even harder to manage? Where does resistance to change come from and what can we do about it?

There is nothing wrong with change, if it is in the right direction.
Winston Churchill, 1874-1965

Well, there is no ready solution (especially not in the space of this blog post). The word “change”, in whatever context, has always made people react with varying degrees of fear, frustration, and/or anger (or “FUD”). Yet, change goes on all around us, all the time. Much of change (the expanding waistline,  for instance) happens so slowly and subtly that we don’t notice it until well after it’s taken place.

Some change is thrust upon us. We hear around the office that “change is in the wind” and we feel threatened and anxious.  Let’s say your company has elected to implement a quality management system. Even if the current situation is not good — your customers are letting you know your product quality has slipped by walking away — many of us would still rather have the status quo.  Better the devil we know than the one we don’t…right? (“We just have to make our stuff better…that’s all.”)

The organization has to deal with resistance on a personal and an institutional level. Each is difficult to overcome and, like it or not, both must be dealt with.

Personal Resistance

If I say to you, “We’re going to change the way we do things around here”, what’s your reaction?  You have an emotional reaction, don’t you?  Probably a mixture of shock, anxiety, apprehension, and a few other gut feelings.

The definition of insanity is doing the same thing over and over again
and expecting different results.

Albert Einstein, 1879-1955

You may feel unprepared. You may fear being left behind. Certainly, if you’re like most you don’t like the idea of leaving safe, familiar territory. (Besides, you haven’t done anything wrong.)

Experience may tell you to anticipate interpersonal conflicts in the course of change. It might also tell you to watch out for interoffice conflicts (power grabs, backstabbing…that kind of thing).

Institutional Resistance

Larger companies have a harder time with change, due to inertia (i.e., “It’s the way things have always been done around here”). With the current state of the world economy, there’s the question of where and how to expend your limited time and other resources, not to mention that as resources are harder to come by, the company’s focus narrows considerably. (“We need to increase sales now!“)

Then there’s that 800-pound gorilla in the room — office politics. Whenever — wherever — there is change, some stand to lose power and others, to gain and consolidate. People forget about what’s best for everyone and concentrate on self. “Office politics” is probably the single biggest obstacle to change. Let me amend that — office politics has a hand in change, but not the change we really need.

Change is the only constant.
Heraclitus, 535-475 BCE

Understand that resistance to change exists.  It may take unusually strong leadership — someone with uncommon vision and fortitude — to overcome individual and organizational resistance to change.

Make no mistake, though — change is a part of us. Are you taking an active role in change, or do you passively submit to it? Which of those will bring the kind of change you want and need?

Is change — or change management — a problem for your organization? If you were in charge, what would you do differently about the problem?

7 Keys to Making an Ethics Policy Work

Postedby Steve Flick on 04-26-2010

Here we go again. Just as it did a decade ago, questionable or downright unethical behavior has led to the enrichment of a few and the financial ruin of many. And after the damage has been done, the legislature has vowed to make sure “it will never happen again”.

Here’s the story in 2010: Citigroup allegedly did not see the mortgage crisis coming, or it failed to properly manage risk. Either way, a lot of mortgage holders are in extreme financial difficulty. Goldman Sachs is reported to have made an enormous profit a couple of years ago by betting against the mortgage market, supposedly with help from Paulson & Company.

And before that, there was Madoff Securities. Bernie Madoff was put in jail for running a “Ponzi scheme” for a number of years, but not before investors in his scheme lost everything.

The situation is strikingly similar to that of about a decade ago, when executives at Enron, Tyco, and other companies enriched themselves at the expense of shareholders.  Then, the U.S. Congress developed the regulation known as Sarbanes-Oxley as a result of the financial misdeeds.

Now, Congress is again debating the need for legislation to combat ethical “lapses”. Why legislation should even be considered is a mystery — we know from history (e.g., Prohibition, the War on Drugs) that moral behavior cannot be legislated. When people want badly enough to make a profit, gain power, improve their competitive position, or do whatever it is they want to do, they will:

  • Prevent the undesirable (e.g., ethics legislation) from happening;
  • Water down the legislation so as to make it virtually worthless; and
  • Find ways to circumvent the law, even as it’s being enacted.

So, how do you make people behave in an ethical manner, especially in settings where temptation is hard to avoid? Well, you can’t ensure everyone will behave ethically in all circumstances. If Mom and Dad and all the other influential people in their lives couldn’t plant a fully functioning moral compass in them, you’re not going to have much luck.

It’s an almost certain bet that the companies in question have an ethics policy in place. Merely having an ethics policy isn’t enough, though, any more than having legislation in place is a cure for society’s ills.  However, there are ways you might be able to lessen the risk of unethical behavior. To make your ethics policy work, you can:

  • Develop a clear, concise ethics policy (a “code of ethics”);
  • Communicate your ethics policy to employees, management, suppliers, customers – in other words, let all stakeholders know where you stand;
  • Enforce the policy – punish unethical conduct and positively reinforce ethical behavior;
  • Establish a framework (hierarchy) of ethical responsibility;
  • Develop and implement a system of checks and balances within the framework of your policy;
  • Make all stakeholders part of your ethical framework – everyone is responsible; and
  • Regardless of where you are in the hierarchy, set an example for others.

And no, I don’t expect that “it’s just that simple”. No matter what you do, you will not eliminate unethical behavior entirely. People succumb to temptation when it becomes too great, and this is probably the most important point. Understand what tempts people to act unethically and do what you can to prevent or lessen the temptation.

Good luck, and let me know if you have any answers.

* * * * * * *

Recommended Reading

  1. Grace, H.S., Jr., and Haupert, J. E., “How to Make an Ethics Program Work”, The CPA Journal, April, 2006 – http://www.nysscpa.org/cpajournal/2006/406/essentials/p66.htm
  2. Crosby, David C., “Who Is Responsible for Quality?”, Quality Digest, April 20, 2010 - http://www.qualitydigest.com/inside/quality-insider-column/who-responsible-quality.html#

Is That Really Your Company Policy?

Postedby Steve Flick on 02-01-2010

In a blog post I recently read, the writer said that in America, when someone says “our policy is…”, the policy is stated and adhered to but in his country, “not so much”. He went on to say that the cultural signals are different between the two countries.

The writer goes on to suggest that in his homeland, they seem to operate on the premise that if most people are told, “We can’t do that…it’s against our policy”, they will not question the assertion and will just walk away. But, if you argue forcefully and with conviction, they will comply. In America, you don’t have to argue – they do what they say.

I’m happy he’s satisfied with the way things are here. I would argue, though, based on my many and varied experiences, that policy as written and policy as executed are two distinct branches on the same tree here, there, and everywhere else. And the wrong branch is dying.

I’ll give you an example: I once did business with a certain purveyor of wireless products and services before I became an employee. Once I became an employee, I naturally enjoyed a sizeable discount on everything wireless.  The service wasn’t that great but for the price, I felt I could bear some pain. A few years down the road, the company ”rightsized” and I became an ex-employee.

The way to gain a good reputation is to endeavor to be what you desire to appear.
Socrates

At the end of my wireless contract, I looked at what the now ex-employer wanted to charge me for its goods and services (retail prices had gone up quite a bit).  I asked at a local office if my being a steady-paying customer for over eight years counted for something. What would they do to keep a good customer?

They said they were powerless to do anything – it was driven “by corporate”. I asked them to check with A/R and even offered to get my credit report to show I was a customer worth hanging onto. They wouldn’t deal, though.

I decided to take it to the corporate office. Sure enough, they were as indifferent to my “plight” as the local office. They said, ”If we do it for you, we have to do it for everybody.”

Their stated policy is to “give customers exceptional service” but what their actions say is “…as long as it doesn’t cost us up front.”  Their implicit policy is to treat customer service (or customer satisfaction) as a necessary evil.

The time-honored maxim — that it’s cheaper to keep customers than it is to replace them — seems to have lost its meaning. Perhaps, too, the concept of “cost control” has become the top priority…to the exclusion of everything else.

What do you think? More importantly, what do you tell your customers, and what do you do?

What’s Your “Twitter” Policy?

Postedby Steve Flick on 01-28-2010

We’re conducting a poll on LinkedIn, asking users what their company’s acceptable use policy is with respect to “Twitter”. Does your company:

  • Encourage you to use Twitter?
  • Tolerate it?
  • Discourage its use?
  • Forbid you to use it?

If respondents aren’t familiar with the phenomenon and/or they don’t care, they can click on “What’s ’Twitter’?” The results in this highly unscientific poll, to date, are:

  • 50% – Encourage its use
  • 19% – Tolerate it
  • 26% – Forbid it

Three percent responded “What’s Twitter?”  Looks like two-thirds of this sample is already there or is close to getting there.   On the other hand, if we assign a value to each response, like so:

  • Encourage = +2
  • Tolerate = +1
  • Twitter? = 0
  • Discourage = -1
  • Forbid = -2

The result is between zero and one, which gives us the impression that while this group of companies is aware of Twitter, they’re not ready to make a commitment, either.  They’re a little “lukewarm”.

As I said, this isn’t a scientific poll. LinkedIn doesn’t allow us to gather demographics, so we don’t know if the sample is all B2B, if the respondents are top management or rank-and-file, etc. Still, a dirty window is better than no window at all, isn’t it?

So, what about your company? Are you using Twitter? Do you have a company policy on the use of Twitter? Is Twitter better suited to B2C than B2B?  Take our poll and let us know where you stand.

Thank you.

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