Competencies that Generate Growth
Talented leadership produces good results. Blindingly obvious! But what kind of talents for what kind of desired results? Is there a statistical connection between types of leaders and forms of success? And what kind of leader or leadership group is best for different strategies?
I have been thinking about this a lot, because a number of companies with which I work have similar strategic challenges – how to move into offshore markets, how to accelerate the growth curve, and how to reconfigure the organization Leaner without denting the Customers’ service perception. I especially wanted to look at Growth, and how to train, motivate, recruit and organize for it.
Digging around on this topic, I found several meaty articles. One from Egon Zehnder International struck a chord. Their study of 5,560 CEO’s found a clear link between outstanding leadership competency and revenue growth. The greatest correlation was the CEO or Senior Management Team that is Outstanding at Customer Impact; that is outstandingly pro-active and transformational about serving the customer. A “No Shit Sherlock!” conclusion. The article makes clear that other competencies – such as Results Orientation, People Leadership, Strategy, Organization Development, Market Insight, Change Leadership, Partnering – are not as closely linked to the highgrowth measure. And this Customer Impact competency is equally powerful whether the growth is organic or via acquisition. See http://www.egonzehnder.com/global/misc/clientservice/leadershipstrategyservices/publication/id/ 17500419 for more.
The next challenge is how to attain this competency. A Harvard article from Gulati (HBR 2004) (see http://hbr.org/2004/07/how-ceos-manage-growth-agendas/ar/1 ) warns that much rubbish is spouted by companies and candidates about their “customer focus”, “innovation” and “solutions” attitude. Behind the hype and self-delusion is often a disappointing and mediocre reality. Organizations really struggle to adjust to “providing solutions”. It is a monumental shift in face-toface customer interaction, sales bundling and cross-selling, sales incentive programmes, internal coordination, KPI’s and margin measurement. Organizations divisionalized by product or region find it tough to think more broadly about customer needs.
But it’s an increasingly commoditized marketplace, where product or technology innovation lasts such a short time (ask Blackberry!). So, differentiating by Customer Impact makes a lot of commercial sense across a wide range of industries. The hard part is the execution in a credible and consistently satisfactory way, so that the customer relents – even briefly – from his incessant pricecut pressure.
Growth comes in many forms, from unexpected angles, often in spasms. It requires nerve and patience. I hope 2012 shows solid evidence of sustainable growth for your business.