High-trust companies treat staff like responsible adults

High-trust companies typically hold people accountable without micromanaging them. With a high-trust environment in place, employees are more motivated to perform better.

Using trust as a foundation, management should seek to improves how employees treat one another and themselves. Companies in promoting trust share their mission objectives clearly and regularly with employees to reduce confusion about where they are headed and why. Once employees have been trained and given a clearly defined job scope, allow them to execute projects in their own way. At the individual level, investing in the whole person and not only the technical skills has a powerful effect on staff engagement. Assessing personal growth at regular appraisals should include discussions about work-life integration, family, and recreation.

Being trusted to figure things out can be a big motivator. When companies trust employees to choose which projects they work on best, people focus their energies on what they care about most. And when given the autonomy, it also promotes innovation, because different people try different approaches. Newer, younger or less experienced employees become the company’s innovators, because they’re less constrained by what works.

SourceHavard Business Review

 

Make Time for Innerviews

It requires as little as five minutes of your managerial time but it is five minutes that could change how you lead and motivate your team. Ideally invest the time to conduct a regular innerview – a catchup session to ask at least one member of your team about their personal lives, goals, challenges, and more importantly how you can help them sort out the work issues. An interview is what you do when you’re hiring someone; and an innerview is what you do when you’re interested in building their success and keeping them.

SourceLeadToday

Is being engaged the same as being productive?

According to HBR, it is not. And the reason for this is because engagement is an ambiguous term. Engagement could mean job satisfaction, employee’s emotional investment in the company’s cause, willingness to invest extra effort, or advocating to others that the company is a great place to work. Despite the positive responses that employees give to engagement surveys, it can bear no direct relationship to the number of hours an employee spends on the job. In fact, some employees can be highly engaged yet working short hours. The opposite is also true: employees who are less engaged but work longer hours. Company initiatives that focus solely on engagement or performance without understanding the employee archetypes could have unintended negative consequences.

SourceHavard Business Review

Two reasons why PE funds make more profitable acquisitions

Private Equity (PE) funds pay lower valuations for their acquisitions than corporate acquirers, suggesting that the general partners are either great negotiators, or that they are particularly skilled at identifying under-valued companies. Further, the valuation discounts enjoyed by PE compared with its corporate counterparts is larger when the deal size is smaller.

Due to having fixed investment time-frame, portfolio companies increase their sales, operating profitability, assets and leverage within the first 3 years of ownership, as compared to non-PE corporate peers. Smaller funds with AUM of $500 million or below focus on expansion as their top priority while larger funds focus on operational improvements and efficiency gains. Interestingly, larger or successful PE funds tend to be better at improving the performance of acquired companies than those PE funds with a less impressive track record, pointing to a “success breeds success” cycle. Also, larger PE funds are better placed to utilize leverage more effectively to achieve scale.

On the other hand, a corporate acquirer is usually prepared to pay extra goodwill in return for either potential corporate synergies down the road or strategic advantages to deny competitors of an asset. It will be interesting to find out whether those very portfolio companies are then bought over by strategic corporate acquirers from PE funds.

SourceLondon Business School

What to do when you can’t build a team from scratch

In reality, most leaders do not have the luxury of building up a new team from scratch. Instead they are put in charge of an existing team, which could be the one that created the situation that the leaders needed to fix. When replacing members in the short term is not an option, they should broadly speaking assess, reshape and accelerate team development.

The new manager should quickly size up the dynamics of the team that is inherited, gathering information from preferably one-on-one chats, team meetings, and stakeholders. At the same time, reflect on the business challenges facing the firm, and the kinds of people needed in various roles, and the degree to which they collaborate.

Having that understanding, adjust the composition of the team by moving people to new positions where there is a better fit, redefining their job scope or responsibilities, or replacing them as a last resort. Ensure that everyone’s goals and incentives are aligned by changing the team’s direction if necessary. Also think about how changes can be made to the way the team operates (e.g. creating new sub-teams, frequency of meetings or running meetings differently to focus on strategic or operational issues) to improve team performance. Further, establishing ground rules and processes to sustain desired behaviors or eliminate destructive behaviors, and revisit those periodically especially when there is a change in membership.

Above all, set the team up for early wins. With the initial successes, they will boost everyone’s confidence and reinforce the value of the new operating model, paving the way for ongoing growth.

SourceHavard Business Review

 

The Shakespearean Leader

Lovers of the bard’s plays are often mesmerised by how the character develops as the play goes on. Consider this: If a character merely unfolds along with the plot, we already know all there is to know about them when they appear. They illuminate little because they cannot surprise us the audience. In Shakespeare, powerful character change comes about as a result of the antagonists moving toward – rather than away from – the anxieties that external challenges impose on their internal worlds. In a leadership context, Shakespearean plays have shown us that self-awareness is useful to a leader when it is revelatory. And it can only be revelatory when one is willing to concede that one knows himself or herself only partially, that is leadership is a ‘work-in-progress’. In this sense, leadership development is less about learning new skills than about discovering ourselves anew by giving something up, including cherished notions of the person who we think we are, in order to discover the better leader we could become.

SourceHavard Business Review

 

How leadership is perceived across cultures

Imagine a single fish that is swimming ahead of a shoal. Anglo managers, i.e. those from the UK, North America, and Australia, would view the leading fish as the pioneer that leads individualist fishes from the front. Japanese counterparts would view it as a metaphor for a cohesive team working together behind a collectivist leader. Interestingly, Nordic peers would see the shoal bringing the leading fish back into the group, since no one is perceived as more special than another. As these differences in perception are driven by the various notions of power distance in these cultures, it is important to understand these subtleties when leading a multicultural team.

SourceLondon Business School