More than anything, I want you and yours, and our enterprises and communities, to enjoy the gift of ongoing vitality. Despite the escalating challenges of modern life, genuine resilience is within our reach (even if sometimes counter-intuitive.)
Our brains really do determine what’s possible both personally and in business. Neuroscientists say that aging is a process of rigidifying. Facing almost intolerable uncertainty, it’s tempting to fall into habits that reduce resilience. But recent insights from brain science offer the choice of boosting vitality instead of losing it.
I am writing today with two gifts: this delightful article
shows the interactive drivers working in a real example. And this new eBook
shows how to apply them in your personal life as well as your enterprise.
It takes a bit of determination, but you can put the drivers to work for you. Open your holiday gift
. And pass it on to anyone you care about. It truly is the gift that keeps on giving.
From my heart and mind to you and your loved ones,Marsha
I've been reflecting on how rare it is that enterprises enjoy the benefit of good leading indicators. Seems obvious that everyone would benefit from identifying and tracking performance drivers.
It's not a new idea. Game theory – first published by mathematicians in the 1940's – calls for measuring how you know you're winning early in the game - long before the final score. The Balanced Scorecard was developed in the mid-90s at Harvard Business School. It calls for the mix of leading and lagging metrics in the diagram above, emphasizing the drivers of performance in Organizational Capacity (culture, leadership, the right competencies – that pesky soft stuff) and Operations.
The right leading metrics are both performance drivers and early warning signs: illuminating the actions and systems that generate value. Tracking them enables leaders to make timely adjustments to enhance performance.
Yet most boards and executives continue to focus on outcomes - lagging indicators - visible after the fact, like the final score of a game. Finance and Customer Satisfaction are among those outcomes. Much easier to identify and measure than leading indicators, certainly, but they don't drive stellar performance.
By contrast, Warby Parker
is a highly-respected fast-growing company whose founders go out of their way to share what works for them. They launched their company powering customer service with “intelligent native speakers who are empowered to act” rather than spending on marketing. They thought that would be a good leading indicator. Bulls eye: they hit their first year's sales goals in the first three weeks of operation.
Why wouldn't execs invest in identifying what will drive performance in their enterprise? What's in the way of reaping the advantage of leading indicators? The best ones are enterprise-specific and proprietary, so we don't hear about them much. Plus, organizational capacity is a key performance driver, and it involves ‘soft' variables such as culture and leadership practices. Perhaps more importantly, identifying enterprise performance indicators requires a clear, compelling strategic core. What I call Core Promise
: what do stakeholders in your ecosystem rely on you for (and what do you want them to rely on you for?)Here's
how I do it. And here are a couple of examples of performance drivers/leading indicators:
One of my favorites was designed by a team of scientists
; it changed the culture of the research division of a Fortune 100 company and drove the performance the CEO was looking for. They moved from a cultural norm of “Get your project funded as long as possible” (a legacy from grad school) to measuring how quickly they could eliminate projects.
Another is research-based: tracking the term
of donor and volunteer commitment drives a high-performance non-profit culture. Rather than dollars raised, measuring the number of five and ten year commitments transforms staff and Board behavior, messaging, events, and generates the kind of donor experience that makes a difference.
I'm collecting examples. Feel like sharing?
I love what Warby Parker
They disrupted an industry by introducing fashionable eyeglasses online – met their first year's sales goals in the first 3 weeks of operation.
For every pair you buy, they give a pair to someone living in poverty who needs glasses (there are 1 billion such people) – and guess what? They care about fashion too. In fact, the company was founded on the insight that even people living on $4/day or less will choose to ‘stay blind rather than wear something unfashionable on their face'. Watch these short INC videos
– they're well worth your time.
Sure, they have a social mission, but they understand that their core promise
is fashion – delivered sustainably for all their Stakeholders. They understand their ecosystem.
And it gets better. They understand the drivers of value: they know their leading indicators are culture and people. They hire based on personality and fit; one of their 6 questions in job interviews was, ”What was the last costume you wore?” They populate Customer Service with smart native speakers, and empower them to take care of customers as they see fit. They believed the cost of that would offset by greatly reduced marketing costs – and they were right.
Marketing? They believe in making people feel connected: they published a new kind of ‘annual report' showing what they did the prior year in terms of customer responses and engagement. Immediately they had their highest sales ever – in January, right after Christmas – higher than the days following their appearances on CBS news or the NY Times.
Think you're Stakeholder Centric? These folks set a new standard.
Last week I was privileged to be present when David Whyte
addressed a group of leaders at Intel. Kudos to my colleague Lisa Marshall
and to Intel's Business Client Engineering Division 'Mindful Engineering'
series for making it happen
From the poet came the gift of this phrase; "Language against which the mind cannot defend"
It was a rich 90 minutes. It's remarkable to be with a poet who keeps himself connected and contributing to the corporate, technological world - an extraordinary human being.
He pointed out that such language is always based in vulnerability. And it comes, not from the strategic mind – the mind focused on what action might be best – but from a deep quiet. From the place most of us prefer to avoid: the one embraces our inevitable vulnerability. The example he gave was a question: a parent, having spoken somewhat thoughtlessly to a teenager, punished with shunting, reaches her with genuine humility, "Charlotte, what is one thing you'd like me to do less of, and one you'd like me to do more of'?” He was rewarded with uncrossed arms and a look in the eye. Something we in business must learn to do.
I believe with all my heart that only those who fully embrace the roots of commerce in vulnerability
will make it through the current economic upheaval. In the Industrial Age, [short – perhaps 10 generations of the thousands in human history] business folk were happily tranquilized to believe that commerce could be secretive, and that one party could avoid vulnerability at the expense of the other. That dream is in its death gasps, at the effect of the Information Age.
Some good thinkers
are onto the deep challenge this is for enterprises:
“CEOs today are certainly enlightened enough to understand the new world. They know they are more vulnerable than ever. In quiet moments, they say, “I don't have the answers. This is pretty hard.” That's why I'm optimistic. I think this is the right time to rethink and change how business is done.”
Source: Strategy & Business Thought Leader Interview with Dov Seidman
‘Having the answers' isn't likely; it's the questions that move us forward. My current favorite from deep quiet works very well to put an organization on track - it's the foundation for Core Promise
:What do people rely on you for, and what do you want them to rely on you for?
What will you do no matter what?Try it – the mind cannot defend against the question.
I recently read Diamandis and Kotler’s Abundance: the Future is Better than you Think:
a delightful account of diverse entrepreneurs stepping up to many of humanity’s greatest challenges. If you haven’t yet had the pleasure, I recommend it for a great rush of optimism and a clarion call.
In the wake of their book, I took the challenge of upping my own contribution. I believe that organizations have a big role to play in creating a world that’s safe for our progeny. We're in a resource crisis, and something fundamental has to change at the enterprise level. Here
is a method I have used for years: a simple model for driving Stakeholder value with far less resource. I hope you will find this eBook
both challenging and useful, and if so, that you will help me get it out to forward-thinkers looking to be a bigger part of the solution.
Many thanks to the generous colleagues who helped wring the model from inside my skin to make it accessible. Blessed are they who live in a learning community.
More Recent Articles