Senior Management Incentives in the News

Strategic incentives are a good idea at the top.  But getting everyone one in a large company on the same page is difficult, and it doesn’t always work.  Here are a few current examples:

  • United Airlines’ CEO Oscar Munoz reportedly has $500,000 of his bonus tied to customer satisfaction questionnaires.  You’d hardly know it from the nearly unbelievable physical ejection of a passenger, and United’s follow-up to the incident.  Some background:  In 2010, United began a botched merger with Continental.  In 2012, United had 43% of all airline consumer complaints, and has been a leader in complaints since then.  On January 14, 2016 Bloomberg’s article, “United’s Quest to be Less Awful” was published.  Clearly things have needed to change for a long time.
  • Apple’s Tim Cook made less money last year (only $10 million in salary and bonus!) than the year before.  That reflects the downward trend of the iphone business, which might pick up this year with a redesigned phone.  But Cook isn’t betting on riding the iphone into the future.  As in the past, the company’s prospects are secret, but you can bet they are working hard on innovation and disruption in other industries, continuing the path that Apple has taken throughout its history.  That’s what his focus and challenge is, and what his future bonuses will depend on.
  • Ford Motors’ board wants CEO Mark Fields to accelerate the company’s transformation and profitability beyond SUVs and pickups.  They’ve put into place a $2.5 million “strategic incentive grant” designed to reward both innovation and growth.  He received a reduced bonus last year as revenue and quality slumped.  The board realizes that making the core business more profitable won’t be enough — they need innovative solutions for the future.

Obviously, sometimes incentives get everyone on the same page, and sometimes they don’t.  Even the largest companies can’t seem to nail it, in part because transforming such large companies is a significant challenge.  But significant incentives can provide significant focus at the top.

What kinds of incentives are you using at the top?  Are they operational or strategic?

© Copyright 2017  Bob Legge

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Bob Legge provides organizations with the ability to exceed their most ambitious goals.  I work with leaders of Fortune 500 companies, small and mid-size companies, nonprofits, education, and government. Together, we drive strategy, lead successful change, develop high performance cultures, improve individual and organizational performance, and produce faster, sustainable growth and value.  Contact him at  bob.legge@leggecompany.com

10 Ways to Eliminate Mediocrity in Your Organization

An organization that accepts mediocrity is a haven for under performers, and very frustrating for high performers.  Here are ten ideas I found in my work with organizations are each effective in reducing mediocrity.  Best of all, you can put any of these ideas to work immediately.  If you can accomplish 8 to 10 of them, you’ll sharply-focus your organization, reinforce strong accountability, and dramatically improve operating results.

  1. Improve your hiring selection process to focus on behaviors that support your culture, as well as a performance track record, and an attitude of learning and growth. One of the best ways to improve overall quality of results is to make sure that you don’t hire problem performers.  Set a goal to always hire individuals who are better than your average performer, that way you’ll constantly be upgrading your talent.
  2. Educate all your managers, especially at the top, about how they should lead, manage, and coach their people. Create “the way we manage people here” mentality along with specific guidelines and company leadership values.  Too often organizations don’t do this and managers end up ‘doing their own thing.’  That’s not good quality people management.  A smart practice is to ensure that every manager has a people-related accountability and performance objective.
  3. Continually improve your strategy development process so that you have a clear direction and overall performance objectives. A good process for creating strategy involves key people so that they all understand it, contribute to the development, have buy-in, and can continually reinforce it throughout the organization.
  4. Make a conscious effort to communicate strategy throughout your organization so that know what to focus on in their daily work to help achieve the strategy. You want an organization where everyone understands where the organization is going and how it expects to get there.  I’ve seen companies not communicate strategy because they think their strategy is so confidential.  Hogwash!  How are your people to know what they are working towards if you don’t tell them.
  5. Develop a goal-setting process that aligns effort and results on key metrics. Setting overall goals and specific objectives is where the rubber meets the road.  You’ve got to translate the strategy into specific goals and objectives for groups and individuals.  Schedule goal setting to begin the year with goals; not 3-4 months after the start of the year.
  6. Provide regular performance feedback (“Here’s how you’ve done.”) and performance feed-forward (“Here’s how you can be more effective going forward.”) Of the two, feed-forward is more effective in improving performance.  Regular feedback is at least monthly, not annually.
  7. Understand that newer employees, those working remotely, recently promoted, and longer-term employees all have different needs for feedback — one standard approach is unlikely to work for   In short:  Know how much feedback each person requires.
  8. Create a system where people can track their own results and get feedback from their peers on where they stand, what they are doing well, and how they can be more effective. Incorporate your own organization’s best practices.  Make this a dynamic system.  There are some great tools available to automate this process and implement a ‘social media’ kind of performance feedback system.
  9. Identify under-performers early. Give them candid feedback, specific improvement objectives, and the opportunity to improve.  When you have a performance problem, determine whether it is a skills issue or a motivation issue — the solution is quite different for each.
  10. Develop a standard separation process to exit people from the organization while treating them fairly and with dignity. Separating people is never pleasant, but a good process will make it easier.

Stop procrastinating about this whole issue — begin today.  The best time to begin is now because every day you wait is another day that you are not getting the results you need, and another day that your best performers wonder if things will ever change.

If you want to get off to a fast start, call me and together we’ll put together a plan to immediately get better results.

© Copyright 2017  Bob Legge

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Bob Legge provides organizations with the ability to exceed their most ambitious goals.  I work with leaders of Fortune 500 companies, small and mid-size companies, nonprofits, education, and government. Together, we drive strategy, lead successful change, develop high performance cultures, improve individual and organizational performance, and produce faster, sustainable growth and value.  Contact him at  bob.legge@leggecompany.com

Powerful Ideas to Improve Your Leadership

From many years of coaching executives, here are five pointers for becoming a better leader:IMG_4487

  1. Hire people who are better than you in their discipline; not subordinates.
  2. Focus yourself on key priorities — move a few things forward a mile rather than a lot of things forward an inch.
  3. Focus your people on results; not activities.
  4. Demand commitment; not compliance.
  5. Encourage and reward open, honest, and insightful thinking; not going with the flow.
  6. Expect people to fail now and then. Mistakes are part of learning.

© Copyright 2017  Bob Legge

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Bob Legge provides organizations with the ability to exceed their most ambitious goals.  I work with leaders of Fortune 500 companies, small and mid-size companies, nonprofits, education, and government. Together, we drive strategy, lead successful change, develop high performance cultures, improve individual and organizational performance, and produce faster, sustainable growth and value.  Contact him at  bob.legge@leggecompany.com

Do This Before the End of February

It’s February and you’ve got most of the year still ahead.   See if you can answer these questions clearly and briefly:

  1. What is your strategy?
  2. What is the over-arching vision you have for your company?
  3. What is the major theme, or themes, you want your people to run hard at this year?
  4. What are your top three priorities for the company?

Your people want to know how to move forward, what to base their day-to-day decisions on, and how to know they are on-track.  If you’ve put together a simple roadmap or strategy, it will be found posted in their work areas, cubicles and offices.  More complex strategies are in PowerPoint presentations or binders and they rarely get looked at.  So if you can answer the four questions above, make sure your people know the answers too.  If you can’t answer them, you need to get to work.  As I said, most of the year is still ahead.

© Copyright 2017  Bob Legge

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Bob Legge provides organizations with the ability to exceed their most ambitious goals.  I work with leaders of Fortune 500 companies, small and mid-size companies, nonprofits, education, and government. Together, we drive strategy, lead successful change, develop high performance cultures, improve individual and organizational performance, and produce faster, sustainable growth and value.  Contact him at  bob.legge@leggecompany.com

Three Imperatives of Profitable Growth

From over 30 years of working with organizations of all sizes and in many industries on improving business outcomes especially growth and profits:

  1. The most valuable part is having a plan that focuses on both distinctive strategy and operational excellence.
  2. The hardest part is sticking to the plan by following-up on performance commitments including position accountabilities, projects, and key operating measures.
  3. The chief downfall is not aligning the organization with plan. Successful companies have one plan with everyone understanding their role in getting results.  Also-rans may have a plan, but they let organizational functions and departments do their own thing.

© Copyright 2017  Bob Legge

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Bob Legge provides organizations with the ability to exceed their most ambitious goals.  I work with leaders of Fortune 500 companies, small and mid-size companies, nonprofits, education, and government. Together, we drive strategy, lead successful change, develop high performance cultures, improve individual and organizational performance, and produce faster, sustainable growth and value.  Contact him at  bob.legge@leggecompany.com

Turning Culture Into Competitive Advantage

Oops!  In last Monday’s email, I wrote that a 1000-foot runway (implementation plan) would be insufficient for a beautiful jet (corporate strategy) that requires a runway of 10,000 feet.  At least that is what I meant to write.  The typo was reported to me numerous times: First by a perceptive reader in Estonia, then another in Hong Kong, and then an onslaught of readers from the U.S. and Canada.  Thanks for keeping me on my toes.

Turning Culture into Competitive Advantage

Sooner or later theories need to become practical actions that drive results — one of the hallmarks of my consulting work.

Last week I read an excellent article about how one law firm is using culture as a competitive advantage, and most importantly, the specific actions that make it work.

If corporate culture has always seemed to be a fuzzy notion to you, and you want to understand how culture can be used to drive measurable results, read Ed Hourihan’s excellent article from the New York Law Journal about how Bond Schoeneck & King PLLC,  is doing just that.  It should trigger some good ideas for you.

Here’s the link:  http://bit.ly/2e2wSDd

Do You Have Enough Runway for Your Strategy?

My client called me to help improve company performance.  The strategy they had developed was beautiful, like a new 747, capable of taking them where they wanted to go.  The problem was with how they were implementing and executing the strategy — they had built an equally-beautiful 5000-foot runway, but their 747 required 1000 feet to take-off.

Strategies never fail in the boardroom or strategy retreat.  It’s in how it is implemented.  Ask yourself:

  • Do we have the right message and ability to communicate this strategy to our people?
  • Do we have the organization structure we need to carry-out this strategy?
  • Do we have the right people in all the key positions?
  • Do we have the quality of management processes to translate this strategy down through the organization?
  • And do we have the right reward systems to drive performance?

In the end, we launched that strategy and achieved the levels of profitable growth they had targeted.  Make sure you build the right runway for your strategy to succeed.

© Copyright 2016  Bob Legge

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Bob Legge provides organizations with the ability to exceed their most ambitious goals.  I work with leaders of Fortune 500 companies, small and mid-size companies, nonprofits, education, and government. Together, we drive strategy, lead successful change, develop high performance cultures, improve individual and organizational performance, and produce faster, sustainable growth and value.  Contact him at  bob.legge@leggecompany.com