The culture of a company is one key to its success, and changing leadership can create a challenge to developing that successful culture. Joel Trammell, author of The CEO Tightrope, discusses how distribution company executives and leaders can influence company culture to obtain the most useful ideas and criticisms from their workforces.
Clearly defined responsibilities, goals and day-to-day tasks are helpful to have when starting a new job or taking on a new position. But the role of CEO and many other leadership roles often lack that definition. Balancing strategic business planning with human resources is one of the biggest challenges that leaders face.
“I always say that every CEO who takes over a new position is unqualified, because to be qualified fully for a job, you’d have to know all the people, know the industry, know everything, and the only way to get that way is having already done the job,” says Joel Trammell, author of The CEO Tightrope. “It’s one of those positions where you’re always coming into it a little bit unprepared.”
The initial step a new leader should take, he says, is to clearly define and communicate a vision for the company. Without a distinct direction, it’s difficult to take actions for change. And defining that vision can take days, weeks or even months, depending on the complexity of the organization and how much a vision needs to change from previous leadership.
Trammell says that he will often ask CEOs and leaders of organizations what they believe success means for their companies. Then, he’ll ask employees the same question. “If they don’t all give me the same answer, that’s a clear sign that people haven’t taken the time to define where the organization is going,” he says.
It happens often, Trammell says. It’s typical for employees to focus on cutting costs or saving time, and lose sight of the bigger picture – or possibly not know what the bigger picture is in the first place.
Avoiding this disconnect between upper management and line-level employees requires employees to be taught a framework and method for making decisions, he says.
“A great example of a company doing this very well is Walmart,” Trammell says. “Walmart’s tagline and focus is ‘always low prices.’ If you go into a Walmart and walk up to a cashier and say, ‘I saw this item for $5 down the street, and you’re charging me $6,’ the cashier will ring it up for $5. They don’t call over a manager; they don’t have to call Bentonville, AR, to do that. They do it because they’ve been trained that their key goal is low prices.”
Ensuring that employees all have the same perception of company objectives requires significant training. But employees should be able to balance competing goals of customers and employees and shareholders.
“When there is uncertainty around values, everybody is scared to make a decision, and decisions take a long time to get made,” Trammell says. “Decisions are kind of the oil that lubricates a company’s engine. If you’re not able to make rapid decisions, it’s hard to make good progress in a company.”
Progress is dependent on the culture, and the culture must help employees develop confidence for making decisions.
“Culture is fundamentally based upon what gets rewarded in the organization,” Trammell says. “And typically, if you’re a founder or a CEO, that really reflects your personality. You’re going to reward what you value. You’re the mom and the dad of the family. Kids are going to behave in the way that you value and reward.”
Culture is what facilitates company growth and innovation, retains employees and attracts new ones, he says. And the CEO is the only one who can really drive that.
Trammell says that it’s imperative that executives build relationships with people at all levels of the organization, because today’s entry-level workers will be managers tomorrow and leaders down the road.
“Start by using the hiring process to begin to build that relationship there,” Trammell says. “The employee will know you voted for them, that you voted to hire them. You’ll always have a little bit of a connection there.”
Over time, leaders should work to build up additional touch-points and
relationships with these employees. In big organizations, the leaders won’t be able to interview every person, but putting forth efforts to make connections will pay off.
“You’ll find that some people are more open than others, so you spend a little bit more time with them,” Trammell says. “But it’s a continuous process. You can’t just say, ‘OK, now this month I’m going to go out to lunch with somebody and expect them to be open.’ If you haven’t built the relationship over time, they’re going to be very guarded.”
The point of connecting with employees is to learn about areas where the business is lacking. As leaders gain more responsibility, Trammell says the worst thing they can do is assume they know what employees are doing.
“In my experience, the best leaders are continuous learners,” Trammell says. “Begin with asking questions such as ‘What can I do better?’ or “How can I help you do your job better?’”
But leaders need to be prepared to not get complete answers from every employee. For many people to give honest feedback about their workplaces, a leader must first establish trust.
“When you start out at a company and you’re on the bottom level, everybody will tell you what you’re not doing right,” Trammell says. “But as you move up in a company, fewer and fewer people will be honest with you.”
Another way to gain insights into unfamiliar company segments is to give people a forum for anonymous feedback. Often, companies don’t provide their employees a place to submit anonymous feedback and all they hear are the positives, Trammell says.
“You see it a lot when a CEO leaves a company,” he says. “All the employees will start saying, ‘Oh yeah, he wasn’t doing this right, he wasn’t doing this right.’ But you never heard that while he was still in the role. Why weren’t people saying that before? Well, because he was in a position of leadership. They were scared to make those comments.”
Leaders can use anonymous feedback to ask about specifics from employees, opening the door for them to offer their own experiences and opinions. Having a line of communication is critical to making big decisions, but there’s another piece to decision-making that Trammell says many companies also overlook: post-mortem analysis.
Company leaders should always establish a time frame for assessing the outcome of decisions, to review how the decision was made, why and what the outcome was. Those factors can contribute to future decisions.
“Often, with things like acquisitions, people make decisions but then never re-examine,” Trammell says. “Nobody goes back and says, “Where did we go wrong? What did we not see so that we can not do it again?”
The same strategy works for decisions that had positive outcomes. Trammell says in his own businesses, he likes to appoint one staff member to take the devil’s advocate position during team discussions around big decisions.
“If we’re looking at buying a company and everyone wants to go forward with it, I always grab one person on my staff and say, ‘Your job in every meeting is to come up with all the reasons why we shouldn’t do this.’ If you don’t set someone up to do that, you tend to get group thinking. Once people get the sense that the leader is headed in one direction or another, they often will kind of line up behind the leader.”
Taking proactive steps will help ensure that all potential negatives are heard, which will also nurture confidence in employees that opinions are welcome.