What’s stronger: hiring amazing individuals or creating a unified organization?
A clenched fist is always stronger than five fingers, but when it comes to business how are you supposed to balance finding skilled workers with creating a cohesive team? Every good coach knows that the true secret to assembling a winning group of people involves one part talent, two parts coaching. How can you tap into your organization’s workforce in a way that inspires and empowers them?
Dave Ulrich is considered by many to be the father of modern human resources. He's the Rensis Likert Professor at the Ross School of Business, University of Michigan, and a partner at the RBL Group, which is a consulting firm focused on helping organizations and leaders deliver true value. He's the recipient of a lifetime achievement award from the ASTD, and he's been repeatedly named to the Thinkers50 List of Top Thought Leaders. His new book is, Victory Through Organization: Why the War For Talent is Failing Your Company and What You Can Do About It. I recently interviewed Dave for the LEADx Podcast, where we discussed everything from coaching talent to his go-to advice for first-time managers. (The interview below has been lightly edited for space and clarity.)
Kevin Kruse: You say we should pivot from fighting “the war for talent,” to “victory through organization.” How do we make sure the value we offer isn't just the sum of individual pieces?
Dave Ulrich: It's a great concept. You have to have good people. I love the term you used, “pivot.” It isn't shifting. A pivot means you keep A, while you still do B, and you still do C. So, we collected data, and I'll do the research and then we'll do the stories. We have data from 1,200 businesses around the world, and 32,000 people. The 32,000 people have talent. They have skills. They majored their skillset. We actually measured skillsets of 4,000 people from other assessments. So, we have data around individual skills.
So, if you hold up a left hand with five fingers, you have five individual skills. The right hand is a fist. It's the ability of the organization, 1,200 business units, to build the right set of capabilities to work well. So, you’ve got a question. On the left hand you've got five fingers. On the right hand you've got a fist. We have an outcome variable, and the outcome is business performance on a six item scale. Which counts most? Is it the left hand with the five fingers, or is it the right hand with the closed fist? Does an individual matter more to business performance or does the collective team? Is it the workforce, or is it the workplace?
The beauty of big data is, I love statistics, and my Ph.D. is basically in statistics and numerical taxonomy. I don't mean to bore you to death. So, we did statistics, and I love going to groups and saying, “Which one matters more? Your left hand or your right hand? The fingers or the fist? The people or the process?” And divide ten points. Here's what we found. Four to one, 80/20, ten points, organization. Now you go, “Whoa!” Now remember your term was “pivot.” That doesn't mean you can take really stupid people, and create a great force team. Maybe you and I, and three other people could still probably not beat very many basketball teams. I don't know your athletic ability, but I do know mine.
Even with a great coach. But we do see in sports, in soccer, 80% of the time, 20% of the time the leading scorer in the World Cup is on the team that wins the World Cup. Twenty percent of the time the leading scorer in the NBA is on the team that wins the championship. Twenty percent of the time the winner of the Academy Award, for best actor or best actress, is in the movie that wins the movie of the year. There seems to be a pattern here. That it's not the individual. It's how that individual works together with others, to build the right organization. Talent matters, but organization matters more.
Kruse: How can we take our talented individual players on our team, and create that synergy? Get that organization that's performing better?
Ulrich: Well, first I think you have to have a basic decent talent. You've got to be able to have good people who have great skills, and have learning skills. Then you've got to say, “Number one, organization is not structure. It's not morphology, shape, and rules. It's capability. It's what we come together for, and are good at doing.”
Google is very good at analytics. Marriott is very good at service. Disney is good at guest experience. Apple is very good at innovation, and we could keep going. So, you start by saying, “What is the right capability, or culture we need?” In the field today, everybody's ga-ga over culture, and it's a critical thing. It was the word of the year, a year or two ago in Webster's Dictionary. But it's not just any culture; it's the right culture, and the right culture is the identity of the firm in the mind of our key customers. In other words, if I'm a manager, I want to say, “What culture do I need for my business?” It could be an enterprise or it could be a function.
What is it my function or my business needs to be known for, by those who will use my services? What's that brand outside, that I translate inside? Getting that identity right becomes the key, and then the next step is building internal management actions, that drive that culture. Again, at a high level, this is pretty simple to say. It's not easy to do. Do we communicate that culture? Do we share it? Do we empower people to act on it? Do we hire, train, and develop people? But at the heart of building that organizational identity, or the right culture, is leadership behavior. Do I, as a leader, and as a leadership team I work with, really behave consistently with customer promises?
One of the things we found is, once you figure out what you want to be known for as a company, in the marketplace—and it could be the customer marketplace, the investor marketplace—we've got to build leadership against that criteria. A final example: almost every company, we've seen have competency models–the “Here's what we want our leaders to know and do.” Well, my question is, is it the right competency model? I did work decades ago, and you're too young to remember it, but it's a simple example. It's an old example. You started by getting me back in my history, and senility may have snuck in, but Ronald Reagan fired all the air traffic controllers.
So, I got hired to rebuild that system. It was one of my early consulting projects, where I don't think I failed that time. There's a lot of stories to that, but they start rehiring, and they're not doing well. Suddenly, we look at their sourcing practice and they're going to universities. Well, one of the things that you discover is, what is it that we want an air traffic controller to be known for? It's not innovation. It's not creativity. It's discipline. It's standardization. It's diligence. It's operational excellence.
We start by changing the sourcing process. You go to military units. You go to police forces. You go to firemen. You go to accountants. You go to folks whose training and predisposition is discipline and operational rigor, and suddenly the success rate of transition into full-time hiring goes way up. Such a simple idea, but we don't do that. Most folks aren't building cultural statements against customers. We're not building leadership competencies against customers, we are building our HR practices against customers. We call that “HR Outside In,” and it was our previous book. In this book, On Victory to Organization, you've got to build the right organization against the promises you make your customers.
Kruse: You say HR should ask “To what extent do we have branded leaders who deliver results in the right way?” What do you mean by “branded leaders?”
Ulrich: Again, I'm going to be a bit of a curmudgeon. I think often in leadership, we look at the action, not the outcome. For example, people say, “I want leaders to be authentic.” Well, I'm just going to disagree. You want leaders to be inauthentic? Of course, authenticity is important, but leader authenticity, in the absence of adding value to someone else, is narcissism. This is a risky hypothetical, but you might have a leader who is very authentic, who shares what he thinks every morning, may even Tweet what he thinks every morning, to a broad audience of followers. Very authentic about what he says, and what he does, but unless that leader is creating value for someone else, that's narcissism. Leadership is not about authenticity, in the absence of helping somebody else be better. That's the issue around “Outside in” and brand.
What a leader wants to do is not just to have a personal set of behaviors, but to turn those behaviors into a brand, that helps other people get better. So, it isn't what I do, it's what somebody gets from what I do. It isn't that I communicate, it's that I communicate so that somebody is better, because of the communication work that I do. What we have found is, there's a line side in the branding world, between a product, you start with that. I have a customer, I buy a product.
You talked about pharmaceuticals, where you had some opportunities to learn. They have a product, but beneath that, they want to become known as a firm brand. Pfizer says, “I want to not just have a great product, but a creator of a whole bunch of products.” Underneath that firm brand, then should be our culture. That creator of multiple products in the marketplace, that pipeline, means a culture of innovation. That culture of innovation, or that cultural brand, firm brand, should then lead to a leadership brand. I need leaders who ask questions, who probe ideas, who are creative. That, then should lead to an employee brand. This is then my employee profit proposition. It's what I should know and do as an employee. We see a line side between products, firm, culture, leader, and employee, and the brand theme being the integrating mechanism.
Kruse: What would be some simple advice you would give a first-time manager?
Ulrich: It's interesting. I've had the privilege of coaching, as have you, people from the CEO suite to first line supervisors. I think there's four questions I ask, and they're really simple.
Question one, what do I want? So, as a manager, what do you want? What is meaningful to you? What's success to you? Is it money? Is it fame? Is it impact? What is it in your life, that you want? What is your passion? What is your skillset? What is your purpose?
Number two. Who do I serve? Because again, the value of what you want is insufficient, if you're not getting some other people to be better. So, who are my stakeholders? Who am I trying to help? I'm a young manager. I'm trying to help my boss. I'm trying to help my peers. I'm trying to help my employees. I'm trying to help my company. Who is it that will benefit, because of my work?
Number three. How do I build? How do I then, as a young manager, create my identity? That's who I am. That's number one. My brand, that's who I serve, that's number two. Number three. How do I create an organization? How do I build something, so that it outlasts me? Successful leadership is not what you do. It's what you leave behind.
Finally, number four is, where am I on my earning? Where am I? What am I doing that works? What am I doing that fails? I love your first question. What am I learning from my mistakes? What am I learning from my failures? Where am I relative to that?
My four, kind of generic coaching questions, what do I want? Who do I serve? How do I build? And where am I? Those would be some questions, I would encourage, not only a young manager, I think even more senior middle managers and more seasoned executives, constantly should be reinventing themselves, by those four questions.
Kruse: You also have to keep asking these question throughout our career, because the answers will change.
Ulrich: I think you and I are both perhaps old enough to know that “What I want” is different now than what I wanted 20 years ago. My goal is to have an impact. To help people think differently. To see their world in a way that empowers them, to make more informed choices. Well, that's useful. That's what I want. How do I then, get that out? How do I build systems to distribute that? Where am I on the journey? Am I pushing myself? Am I learning as I go? So, what would you say? What would your tips be?
Kruse: For me, the biggest lesson was learning how to give feedback. I’m an introvert, so that was challenging.
Ulrich: Boy, I can relate to that. I too am an introvert, and I was wondering, why are we not doing a video? And now I know why neither one of us want to be on camera.
But there was an old test. Today you have Myers-Briggs and you have disks. It was called Fibro B. One thing I liked about Fibro B was what do you give and what you receive? So, not only do you have to learn to give feedback, you've got to also learn to be a recipient and to receive the feedback.
And you said that well in your response. A good leader gives feedback, but part of the giving feedback is modeling receiving feedback. So, a leader in a performance appraisal says, “Look I have some things I need to tell you, that will help you do your job better, but let me start. What is it I need to do as a leader, so I can improve?” So, the leader models that, and says thank you. Those are things I need to look at. Then in the same spirit, can help the employee begin to improve his or her performance. I really like that.
Very nicely done. In fact, in the HR field, there's a big movement now, to do away with performance appraisal. I think that is so dumb. As in accountability, people don't perform. Almost nobody washes a rent-a-car before they turn it in.
We do fill it up with gas. What we've got to do, is we've got to have positive performance accountability. That doesn't mean you do paperwork. It means you have positive conversations, and that's one of the issues where I see that getting played out.
Kruse: I always challenge our listeners to become just a little bit better every single day. So, I'm hoping you'll challenge us.
Ulrich: My personal brand and identity is learned. So, what did I do yesterday that didn't go so well? What do I learn from it? Run into it. Don't run away from it. We love to run and hide. Run into it. What did I do? What can I do better, and how can I apply that today?
Kevin Kruse is a New York Times bestselling author, host of the popular LEADx Leadership Podcast, and the CEO/Founder of LEADx.org, which provides free world-class leadership training, professional development and career advice for anyone, anywhere.