Brandt On Leadership -- Closing The Gap

CEOs and senior executives spend a lot of time outsmarting themselves. They walk big, talk big, and sometimes even think big, but they often spend so little time executing those big thoughts that they might as well never have had them in the first place. I was reminded of this last week during a strategy discussion with a group of executives when I was asked, "Is employee empowerment important in this strategy?" "Yes!" I stammered, unable to believe that someone could think the need for empowerment is over. "Of course! More than ever!" Yet the question got me thinking: Maybe it seems more difficult to lead a firm these days because we know more now about what works -- in leadership strategies, in management tactics -- than we ever did before. Yet this wealth of knowledge, instead of liberating us from the bad practices of the past, instead too often has confused and paralyzed us. With so many possible paths to improvement, how can we know which to choose first? The result of this confusion is a growing divergence between the grand visions of CEOs and senior executives and the day-to-day jobs of employees expected to implement those initiatives. For lack of a better term, let's call it the Strategy-Tactics Gap -- the distance between what CEOs want and what employees need to fulfill those wants. CEOs need to be focused on two strategies that will allow their companies to succeed in the future: Collaboration: How will your company create customer value by partnering with suppliers, vendors, and customers? Whether you call it collaborative commerce, value-chain management, or leading the extended enterprise, it's clear that tomorrow's winners will be the companies that optimize customer value by working with partners via new information technologies and shared customer management. Choosing the right partners -- and building trusting and durable relationships with those partners -- will be nearly full-time jobs for CEOs and senior executives in the future. Innovation: How can your company create a structure that produces innovation -- in products, in business processes, in employee development -- in a consistent fashion? In the future growth in revenues and profits will result from a willingness to create new business models and to reinvent entire companies, again and again and again. Smart CEOs are devoting an increasing amount of time to fostering an environment that encourages innovation -- and its inevitable mistakes. Vital as these strategies are, however, they'll prove useless if companies aren't also focused on three key tactics: Empowerment: No strategy will work long-term if workers are not engaged creatively in the process of determining and implementing it. Engagement comes from three things: training, delegation of real decision-making authority to those closest to the customer, and incentives in the form of profit- or gain-sharing. Everything else --pizza parties, T-shirts, motivational programs -- is BS, and you know it. More important, your employees know it. Customer focus: If you're not surveying your customers regularly -- in written format, on the phone, in weekly meetings between your shipping clerk and their shipping clerk -- you won't have a clue whether any of your fancy new strategies is working or not, or whether your customer even cares. Do something really radical and invite your customers into your strategy sessions. You may find out that they're a hell of a lot smarter than you gave them credit for. With any luck, they might even teach you a thing or two. Lean Production: You can't win the marathon unless you're in running shape to begin with. And if you haven't spent the time to get your production, your back office, and your sales effort into a lean mode, you can't expect a new strategy to work any better than the old one, because there's no guarantee that the new one will ever get implemented. As a matter of fact, if you haven't analyzed your processes to get lean, there's no guarantee you've even implemented your old strategy. Which means that you may already be smarter than you think. Or not. John R. Brandt, formerly editor-in-chief of IndustryWeek, now is editorial director of the Chief Executive Group, publisher of Chief Executive magazine.