At C-Level #5: The power of a few stated operating guidelines

C Level

At C-Level #5 is the fifth blog of an eight-part series following a first time CEO’s educational journey in a very challenging business environment, and exploring global concepts in leadership theory and practice.  

At the end of each blog are reflection questions for readers to consider as they navigate their own leadership journey.

This guest post by Mike Sayre — experienced software, e-commerce and manufacturing services CEO, COO, CFO and Board Director—is based on his first-hand experiences as a fledging CEO. Its intent is to provide additional insight or ideas to those in, close to, aspiring to, or trying to understand the top leadership role in any organization. Mike was also featured in the October 4, 2016 Innovative Leaders Driving Thriving Organizations interview with Maureen Metcalf on VoiceAmerica focusing on the importance of leader trustworthiness in driving organizational change. .

As you know from my previous At C-Level posts, as a first time CEO of a manufacturing services company that was lacking in leadership and focus, I created a leadership tool in the form of a “philosophy card” containing a company mission, vision and operating guidelines that aligned with my own personal mission, vision, and operating philosophies.

An operating philosophy like the “Golden Rule,” which says you should treat others as you would like them to treat you, has always been simple enough. Then came the “Platinum Rule,” which says you should treat others as they would like to be treated. Both can cover a lot of ground depending on how literally you take them. I prefer to give people some credit for understanding these general concepts and believe either is a good place to start. But, in addition, I also think giving a few more specific guidelines (but not too prescriptive) helps round out what you mean by stating your operating philosophy is based on the Golden, or Platinum, Rule.
Here are the operating guidelines we decided to put on “the card” as our mission and vision:

guidingphilosophyclevel5

There are many more you can probably think of that you might put on this card. The truth is, just as I wrote about mission and vision in At C-Level #4, you need to do what best serves the company’s and your purpose and circumstances. And I’d add that your guidelines need to be broad enough to cover a lot of ground, but narrow enough that you do not have to worry too much about others’ potential misinterpretations.

In selecting these operating guidelines, our purpose was to turn around a somewhat ego-centric culture where respect, direction and transparency were lacking, and ambiguity and mistrust were the norm, all negatively affecting our overall performance. To be fair, there are many leadership styles used to “successfully” run and grow companies, depending on your definition of “success,” and this culture had evolved in the company over a couple of years of high revenue growth. This culture was just not consistent with my leadership style, and it’s revenue growth based strategies were not growing value for it’s stakeholders.

Here are some examples of how these operating guidelines helped us change our culture and improve our performance with much more teamwork and transparency:

The Golden Rule – Things like loud distracting radios, inappropriate pictures at workstations and porn surfing were no longer tolerated. They showed a lack of respect for others, constituted sexual harassment, contributed to an unhealthy work environment, and lowered productivity. Stopping those practices set a new and more positive tone in our operations that contributed to overall happier and more productive associates, and showed we meant what we said in our operating guidelines. It was not easy and required significant courage on the part of the leadership team. But, when one of our top performers was let go for one of these practices – as painful as that was – we and our use of “the card” gained a lot of credibility.

“Every day our goal is TOTAL CUSTOMER SATISFACTION…delivered at a FAIR PRICE.” – All programs suspected of losing money were analyzed in detail, and if we were losing money for no strategic purpose, we raised the pricing and talked with our customers, sometimes losing the business, but improving our overall financial position and strength. Over a previous two- to three-year period, sales had grown about 400 percent and profits had not grown appreciably with an economic downturn looming. Commoditized low margin work can quickly deteriorate in a down economy, but scaling down the people and infrastructure at the same rate is not so easy.

“We do not lie, cheat or steal” – Instead of auditing customer-owned inventory counts for our largest customer, we discovered we were just giving them their own numbers back instead of verifying their counts! We were concerned about how the customer might react when we told them, but we told them quickly once when we found the problem. And we remedied it. Over time, the relationship actually grew and we won more business.

To be clear, I do not believe that any of the people involved in these situations were trying to hurt the company or anyone else. They did not understand the negative effects of what they were doing to the business and had never been told otherwise.

If you went back to the earlier installments in this series, I think you would find elements of all three leadership models presented so far (Good to Great, Conscious Capitalism and the Strategist Competency) in the formalization and following of those few operating guidelines we put in place. For us, the stated guidelines reduced distractions, took a number of variables out of our decision-making processes, allowed more decisions to be made by more associates in the organization, and increased the capacity of our leadership team by spreading out decision-making capability and authorization.

Reflection questions:

  • As you assess your current situation, what are the top two to three questions or problems that repetitively come up in your organization that today can only be handled by you or another member of your leadership team because no one else either knows how or is authorized to respond and/or resolve them?
  • For each of those, is there an operating guideline that could be formalized so that everyone would know the answer and could just respond or resolve it without having to come to you or your leadership team?

In At C-Level #6, Mike writes about his first significant sales challenges as a new CEO and how he and the team were able to turn lemons into lemonade.

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, TuneIn, Stitcher, Spotify, Amazon Music, Audible,  iHeartRADIO, and NPR One.  Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

About the Author

Mike Sayre, executive advisor and organizational transformation practice lead, has been a successful CEO, COO, CFO and board director for multiple organizations in technology (cybersecurity, ecommerce payments processing and engineered computer products) and manufacturing (electronics and steel products). He shares his expertise with client boards and C-Level leaders, and advises, designs, plans, and oversees the implementation of successful strategies for turnarounds, growth, profitability and sustainability.

Mike brings 25+ years of organizational and business leadership and hands-on implementation experience to his clients.  His teams have achieved significant increases in growth, profitability and valuation, as well as shareholder, customer, supplier and employee engagement and satisfaction.

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