ILLUSTRATION BY RUTH MACAPAGAL
Today marks my 50th column for the Inquirer. Thank you for all the wonderful feedback, comments, questions and inquiries we have received over the past year, mostly through the website of my group or in countless conversations with entrepreneurs, business owners, family businesses, boards and CEOs.
It is always a pleasure if someone quotes from my column because they find it valuable in guiding them to lead their business to the next level.
View change and challenges as opportunities
I was joining the celebration of the anniversary of one of the most recognized Asian brands last week. In a private conversation, the self-made billionaire founder shared his insights with me into what mindset and beliefs enabled him to succeed. And, not to my surprise, one of them was to always regard change and challenges as opportunities.
Change is always a big opportunity, no matter if you like the change or not. That is irrelevant. This is a belief I have seen in almost all of the successful CEOs and business owners I have had the pleasure of advising and consulting.
If you can adopt this mindset and teach your top leaders to do the same, you have taken a first giant step forward because most businesses do not view challenges as such.
Over the last weeks, I have given a series of keynotes and workshops to a selected group of CEOs and business owners in the region, including many different topics geared toward future-proofing your business in times of change, and profiting from all the unique opportunities that exist in these times.
Create a culture where top talent thrives
One of the hot topics is always culture and top talent. What is the culture of the most efficient, best-performing, and most successful companies in the world? And how can we change our culture to be more efficient? How do we become an organization where top talents love to challenge each other and are happy in achieving success together?
The first thing the best-performing companies do differently is encouraging a culture of radical open-mindedness and transparency.
In several Asian countries, including the Philippines, that is a challenge. People are not used to a company culture where employees and board members openly address challenges, weaknesses and disagreements. Sugarcoating is part of that challenge.
There are so many examples of sugarcoating from our work practice in empowering companies to grow that it could easily fill hundreds of pages. In one case, a board member who fulfilled a highly important role in the company was the completely wrong fit for the job. Even though this impacted the entire value chain of the company, and severely impacted sales and the bottom line, nobody told the CEO. Or the owner. Everyone talked behind each other’s back, but in the boardroom, it was all love, peace, and harmony.
Are you a frog in boiling water?
This is a misconception of companies that do not encourage a culture of open and constructive disagreements; we do not want to hurt anybody, we want to make people happy. Well, guess what, challenges only grow bigger with time. Think of them like a stone in your pocket. At first, you can still walk fine with that stone. But then these challenges grow if they are not addressed. They always do, that is a fundamental law of business.
Imagine adding another stone to the one you already carry in your pocket. And then one more, and one more, and so on. Now, the frog in the boiling water problem sets in. This is a principle that describes this phenomenon: The idea is that a frog will jump out of boiling water if it is placed there immediately, but if it is placed in lukewarm water and brought to a boil gradually, it will not recognize the danger and will be roasted to death. The tale is frequently used as a metaphor for people’s incapacity or unwillingness to recognize or respond to ominous situations that develop gradually rather than abruptly.
It has since been proven false by science. But what is no longer true for frogs still applies to business; most businesses behave exactly like that. The challenges grow bigger with time, as is a natural law, and then we reach a point where the organization has become a slow-moving hippopotamus instead of an agile and lean jaguar.
Become a jaguar
Most organizations are like hippos once they reach a certain age and size. But they have gotten so used to the stones in their pockets, they do not see them. However, the effects still show: missed business opportunities, challenges in execution, challenges in accountability, reduced profits, and the list goes on and on.
Of course, such a business is not able to seize opportunities fast, move quickly against competitors or unforeseen enemies, make slingshot recoveries from challenges, and aggressively seize market share from competitors when they can.
Your goal is to become a jaguar. And to do that, you have to become fast, agile, lean and flexible. To accomplish this, one of the most critical tasks is to build a culture where people openly address challenges, conflicts and constructive disagreements. You could also call them “healthy debates”.
Institutionalize the change
If you want to lead and grow a successful business that will attain its full potential, you must encourage what we call “constructive disagreements.” At first, this will be strange to many.
But contrary to popular belief, you can change a company culture rather quickly if you know how it is done. And one of the ways to solve this is to institutionalize the change. What does that mean?
It means to create rituals, routines and daily practices that build quick wins, which in turn build momentum, which in turn will change corporate culture.
Let me share a few examples: for instance, a daily huddle among teams should have clear rules and guidelines. One of them should be that the senior person always speaks last.
The devil’s advocate
There is also what we call “rotating devil’s advocate.” This means that one team member must take a contrarian, devil’s advocate position to give “forced” constructive feedback. This will make the practice not only more playful but will allow people to become used to voicing their opinion even if they do not agree or if they spot a weakness in a proposal, idea or project.
As we know from innovation, the best ideas rarely come from the top. This practice will encourage top leadership, middle managers and also lower-level employees to voice their opinion. However, if you do not like what you hear, do not rip your head off! As a business leader, you need to walk the talk and be open to whatever feedback.
Remember: Your goal is not to be right but to make the best decisions!
3 action steps
Reframe change and challenges as opportunities.
Tackle challenges head-on as they arise.
Institutionalize changes by creating rituals, routines and best practices.