Saturday, November 15, 2014

Gap Analysis - the Key to effective SWOT

We will wrap up the SWOT Analysis today through a process I call Gap Analysis. While purists may dislike my use of the term, for the rest of you this should make sense by the time we are done.

If you haven't yet completed the collection of Strengths, Weaknesses, Opportunities and Threats for you business, you will want to do this first. See my previous blog for some suggestions and guidance for assessing your current state.

Capturing the current state of your business is critical, but collecting your SWOT snapshot is really only the first step in planning your new strategies. The Gap Analysis is the tool I use to help identify where you should be spending your time over the next period (typically 12 months).

Organizations cannot address all their opportunities, threats or weaknesses simultaneously...we just cannot effectively focus on that many different areas. When we try to simultaneously address too many critical issues, we end creating too many strategies and actions items and we push hard on all of them. Unfortunately, it is like one of those circus guys spinning plates; we just run around keeping plates from falling instead of actually seeing how fast we can spin one or two.

First, make an effort to prioritize your threats. Which of these "out-of-your-control" circumstances have the most potential to disrupt your business? Which ones are most likely to actually occur? Listing threats such as, "the economy goes back into recession," might have a highly negative impact on your business, but the likelihood of this happening in the next 12 months seems rather small sitting here on Nov 15, 2014. It doesn't hurt to have some contingency plans in place, but I don't suspect this threat to loom large in 2015.

Next, prioritize your opportunities. Which have the most potential for success? Criteria you might consider are Time to Capitalize, and Return on Investment or Net Present Value estimates. You should also consider strategic fit (how well the opportunity fits within your organization's skills experience and mission), availability of resources, long-term sales growth, payback time, and ability to leverage your technical and marketing resources.

Now line up your strengths and weaknesses on the left side of a piece of paper or whiteboard and your opportunities and threats on the right side with enough space in the middle to make some assessments. The center is the gap area. The question you want to ask is how can you leverage your strengths and improve your weaknesses in order to capitalize on opportunities or counter threats. Draw connections between each strength and the opportunities or threats that this strength can help address. Do the same with weaknesses. Which weaknesses could prevent you from capitalizing on opportunities and countering threats? As an example, you might have an opportunity to pursue a new market if you can modify a product quickly. However, if you have identified that your product development process is slow, or that your technical resources are limited, these would be weaknesses you need to address in order to take advantage of the opportunity you have identified. In fact, being realistic, you might determine that you do not have the ability to pursue this opportunity. Performing the assessment of opportunities and threats in light of your current strengths and weaknesses will allow you to more clearly determine the areas where you will now want to build strategies.

These steps are designed to help you Fill the Gap between your external state and your internal state. Next we will talk about tools that can help you establish more effective strategies.  Whether you are a collaborator by nature or not, I would like recommend you not do this analysis and planning work in a vacuum. Your team needs to be part of the planning process if you expect to secure the buy-in needed to move your organization forward.  To that end, we have a terrific workshop on "Building Great Teams @Work" scheduled for December 5, 2014 at the Lansing Country Club in Lansing, Illinois. This is a great opportunity to sharpen skills designed to help you strengthen your teamwork. Use the code word: Today and receive 20% off this terrific workshop.

Feel free to contact me directly at jvonthaden@solutions-industrial.com or 630-403-8326 if I can answer any questions.

jvt

Monday, November 10, 2014

Planning - Assessing Your Current State

November is Planning Month at Industrial Solutions and we are blogging about steps you can take to make your planning as effective as possible. We are focusing on strategic and operational planning most of the week, but you might also be interested in reading some of the article links that can be found on the Industrial Solutions LinkedIn page as well. There is an interesting article there from Harvard Business Review warning readers that strategy is not planning. Instead, we use planning to build and implement a strategy.

Hopefully you have gathered information on your results as suggested in my last blog. Have you identified your current state in terms of comparing your progress to your goals. We suggested you look at year-over-year financial results, progress you have made in areas such as employee development or market penetration, and measurements around operational efficiency or product development.

There are a number of planning tools that can be very helpful in assessing your current state and guiding your thought process around strategy development and operational planning.  In my opinion, the SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats) is a critical tool for this process. While other tools such as Porter's Five Forces, PEST Analysis, BCG Matrix, and Life Cycle curves (Product Life Cycle, Consumer Adoption, Market Stage), have their advocates, I have found it most beneficial to integrate the thinking around these other tools into the SWOT analysis instead of attempting to have multiple tools each utilized in a stand-alone fashion.

The SWOT Analysis challenges you to honestly determine the strengths and weaknesses of your organization. You should begin by looking at areas where your organization is highly competent. Are there sustainable advantages you have over the competition? Do you perform amazingly and consistently well in specific functions? Do you have unique product features, intellectual property or unique processes? Are there investments you have made that are cost prohibitive for most competitors and therefore a roadblock for new entries in the market? Do you have a commanding marketshare or favorable position in a specific segment of the market? These are all areas to consider.

Now consider your weaknesses. Essentially consider where your organization is less than superior in areas of operations, finance, sales, products, distribution, capabilities, skills, knowledge, management, marketing, service, communication, structure, culture, attitudes, viewpoints, or location. Any of these could be areas of weakness. Remember, you are listing items that are within your control - even if you don't know how to fix them or believe it will take a very long time. Consider your organization in light of the market, economy, competition, suppliers, buyers, 

Next you will consider your external threats and opportunities. These are circumstances typically outside your control but which may have an impact on your business.  

Threats and Opportunities come from circumstances or changes within the market. Porter's 5 Forces suggest areas such as competition, suppliers or buyers. In addition, the PEST Analysis tool suggests considering how changes in economics, technology, society, and the political/governmental environment can impact your business. Be sure not to 'discount' threats that seem far-fetched or those with a long horizon. There very well might be reason to consider doing something now to stave off these threats. In addition, don't discount opportunities because you don't think you have the resources or ability to capitalize on them. This is NOT the time to limit your thinking or fail to consider all potential avenues. As an example from my own experience, a new technology was listed as an opportunity multiple years in a row before the organization decided to allocate any resources toward applying this technology to the business. If someone had decided to leave it off the list, then the organization might have missed an entire year of development.This handicapping of the SWOT data will happen AFTER you have completed collecting the info in as much detail as possible.

Next time we will talk about performing a GAP Analysis which is the real power for applying the information you have collected in your SWOT Analysis. If you would like more information about planning or think you could benefit from a third-party facilitator, feel free to contact me at Industrial Solutions.  jvonthaden@solutions-industrial.com or via phone at 630-403-8326.

Monday, November 3, 2014

Looking Forward - First Look Back

I had a number of positive comments regarding Motivation Month over the last few weeks.  If you enjoyed the posts, you will want to be sure to check out the Industrial Solutions LinkedIn page where we provided links to a number of articles and posts that really helped to round out and "fill the gaps" of my own writing.

This month we will focus on Planning and if you are in a mid-size or larger corporation, you have probably been in "planning" mode since sometime in August.  However, no matter when you started your formal planning activities, November seems to typically be the time when leaders get serious about looking ahead into the new year.  No matter what schedule you adhere to in your organization, or even if you don't have a formal process, this month I want to encourage you to do some forward thinking.

I will admit that often the pressure to finish the year on a positive note made thinking about the next year, or the next 3-5 years difficult. Shifting your thinking and engaging in some longer-term planning can be challenging to be sure.

My recommendation is to begin by reviewing your current state.  While looking backward isn't going to help you navigate, and no one drives while focusing solely on the rear view mirror, it is critical to know where you are in order to determine what it will take to get where you want to go.  I love using Goggle Maps on my iphone (sorry, Apple).  Google Maps just works for me. What I like the best is that I never have to indicate where I am currently located.  The app shows me where I am and the best route to get where I want to go.  I see how long it will take, what the route looks like and then I can track my progress spatially on the map, time-wise with the clock, and distance in miles or km.

Begin your planning by first looking at your metrics and asking yourself some questions. How are you doing this year?  Are you on track to meet your objectives? How does this year compare to last year?  Have you made positive progress? How do you know?  Where are the shortfalls in your goals?  Have you made corrections or adjustments this year, and if so, are they making a difference?

Did you just say that you don't have any metrics? Time to establish some. An organization needs to select a number of key measurables that are the most representative for taking the pulse of the organization.  For some the focus will be heavily weighted toward financial results, but be careful here.  The financials are not all that matter in an organization.  You might want to look at efficiency or utilization or new product release schedules.  You might consider employee development or market penetration.  Perhaps your goals included adding new customers or entering new markets. How are you measuring your progress?

I have always found that a current state assessment is of huge benefit when planning for the future.  It tells me how much further to my goals, what progress I have made so far, and what course corrections are necessary to continue my forward progress. In addition, establishing these metrics will be critical to how we manage in the future, so go ahead, pick those metrics, those critical factors and let's get a snapshot of where we are today.

One final thought: I believe this current state - future state thinking has implications for your personal financial goals, your family, marriage, and career development.  Determining where you are today is the first step to envisioning and implementing a plan to get you where you want to be in the future.

Take some time this week to begin collecting this data and we'll talk next about other ways to assess your current state.

Happy Planning!

Thursday, October 30, 2014

Motivating Employees - Part 4 - The Dominance-Style Employee

As we wrap up Motivation Month at Industrial Solutions, I want to talk about ways to motivate the D-style employees in your organization and on your team.  As a D-style myself, I suppose I could claim that I saved the best for last, but that really is not the case. Each style brings with it a set of strengths and particular challenges, and the D-style is no different. For instance, one of my colleagues recently indicated they would not particularly enjoy being part of a team that is "High-D", but on the other hand, they would love a lot of D-style employees on the team they were managing. As we look at the D personality style, I think you might see why someone could come to this conclusion.

Motivating a D-style employee is really not the issue, preventing them from becoming frustrated and de-motivated is the larger concern.  Persons with the D-style tend to prioritize getting immediate Results, taking Action, and Challenging others and themselves. These team members want to see things get done and are often forceful in their attempts to ensure the organization is driving toward their goals. Authority and power are often motivators for them and you will often see them focusing on success and winning. The D-style tends to be competitive and self-confident. In order to motivate your D-style employees, give them room to navigate and authority to direct. They want to be part of decision making activities and will like when the organization makes a decision and begins to implement. These employees will appreciate goal-oriented communication and welcome ways to measure progress. As such, you will not often need to add motivational efforts to get these employees to take action and push themselves and the organization forward.

On the other hand, D-style team members can become impatient when decisions are not made quickly. They can become disappointed at the time it can take an organization or individuals to come to the same conclusions they do. They may complain about the organization being "all talk and no action". They can get frustrated with a lot of social interaction, as this is often a challenge, or limitation, for people with the D-style. These team members often take charge and if they are prevented from leading, or are not included in decisions, they can feel as if they are not part of the team.

Sometimes, D-style employees can be considered a bit too decisive and you should encourage their decision-making, but help them not to run too far ahead of the rest of the group. They can become impatient at a more thoughtful approach, as they are used to being able to rally support around their ideas and attract followers. If your organization tends to be more people-minded and less action-oriented, you may be able to benefit from your D-style employees, but you will also have to help them adjust to a more deliberate approach in your business.

If your organization tends to be more affirming or inclusive, this also may create challenges for your D-style team members. Helping them to learn the value of collaboration, sharing with them your values regarding caring for employees, and allowing them to participate in determining ways to show others appreciation and respect can help the D-style grow and learn to appreciate these other priorities.

Organizations are not always led by people with the D-style, but often times D-style individuals are leaders within their organizations. Their natural take-charge approach can be a huge benefit to your organization. Your D-style teammates will push your organization to achieve the goals you have set and you can use their drive and determination to accomplish great things.

I hope during this series you have gained a bit more understanding about the four primary personality styles as defined by the DiSC Personality Profiles.  If you'd like to use DiSC assessment with your team, or participate in one of our "Building Great Teams @Work" Workshops, contact me at 630-403-8326 or send an email to jvonthaden@solutions-industrial.com.  You can also get more information at my website:http://www.solutions-industrial.com/#!healthy-organizations/c1j0t.

jvt

Wednesday, October 22, 2014

Five reasons for developing your employees

I am sure you have heard the one about the CFO who was lamenting to the CEO about the cost of investing in employee development. He said, "I'm having a hard time spending this money. What if we invest in employee training and then they leave?" The CEO responds, "What if we don't and they stay?"
Hopefully you are more like the CEO in the story above. However, I have heard enough similar comments over the years to realize that not all managers are committed to employee development, so let me offer five reasons why I believe employee development is worth the investment.
1) Increased skill equals increased productivity. There is no doubt that people who have mastered specific skills are faster than their novice counterparts. Exercising your employees skills, both hard edge and soft edge skills, are going to pay dividends in productivity. We all know how much more time it takes for us to do things that are not our strengths. We should help our employees to focus on continuing to improve their skills in their areas of strength. The result will be increased satisfaction with their work, higher quality, and increased productivity.
2) Personally investing in people generates loyalty. Perhaps this is easier to believe in its negative form: You will not create loyal team members if you fail to personally invest in them. Nearly all of your team members are motivated by opportunities to grow. Fortunately, not all of your staff aspire to the corner office, but they all want to know they are delivering value. Viewpoints that see the future as unpredictable and unstable, previously held primarily by Millennials now permeating throughout the workforce. However, investing in these younger workers will have a positive impact on their opinions of your organization. In fact, training is likely to be the one thing that can help your younger team members stick with your organization. Since they feel their future is entirely of their own making, strengthening and improving their skills is a key driver for many workers.
3) Your organization needs people ready to step into new roles. Whether or not you have invested heavily in building a distinct culture in your organization, I guarantee there is one. It might not be all you wish it to be, but it is there none-the-less, and people who have learned to navigate your culture to get things done are team members you want to keep. There is nothing more critical than helping your staff increase their ability to get things done and those who can consistently deliver on objectives deserve to be given more responsibility and opportunities for growth. If you fail to invest in your staff, then it is unlikely you will have team members ready to step in when openings invariably occur. Let me also point out that bringing new key leaders into the organization from the outside becomes increasingly costly and risky the higher their level of responsibility.
4) Investing in employees cost less than hiring from the outside. If you are not a manager, you probably won't like hearing this, but the reality is that organizations often must pay more to hire a person with advanced skills and experience than it cost to develop these people internally. In fact, if you regularly utilize search firms to find candidates, a good idea for most organizations, the basic cost of these services are more often than not higher than what you would spend to help your employees gain the skills and knowledge needed to perform in these senior roles.
5) EQ can be developed! While most evidence indicated that Intelligent Quotient (IQ) is fixed by sometime in the teenage years, Emotional Intelligence (EQ) is not. Sure, the adage that you can't teach an old dog new tricks might be something we like to say, the reality is this doesn't apply to humans. When I hear a manager express dissatisfaction about a member of their team, I am always amazed to learn that they haven't addressed these concerns directly. You must really dislike someone to know how they can improve their performance and refuse to tell them. That's the same as refusing to throw a life preserver to someone drowning. Your staff can be better, and they will be better, if you are willing to invest in their development.
Don't let your organization be like the one envisioned by the CEO above. Invest in your people and just as a rising tide lifts all boats, your team will do the same for your business.