Don’t tell me I did not warn you. The only thing I can promise is that you’ll learn a thing or two from this one, so please read on.
I came across a predictive validity framework called the “Libby boxes”, popularized by Cornell Accounting Professor Robert Libby. This framework is used to examine the distinction between underlying constructs of strategic objectives and their proxy measures to illustrate causal models related to some objectives in an organization. Another definition of “strategy” is as a hypothesis about the cause and effect of your objectives. Predictive validity allows you to measure and analyze how well the execution of your objective (cause) predicts your desired performance (effect).
Simple Business-IT Strategy
Now, to illustrate the importance of a Business Relationship Management (BRM) function in an Information Technology (IT) organization, let’s start by picking a Business-IT strategy to dissect. Let’s call it “Strategy A”.
Strategy A: “Create business value through better use of technology.”
Let’s start it simple and take an approach to illustrate cause and effect depict Strategy A using the model. We are going to be taking a very logical approach. The strategy here is— you believe that if you use technology better, you create business value. Let’s assume that technology is comprised of infrastructure and applications that enable the business or enterprise.
Observe that Strategy A is too simple—or maybe exceedingly simple. Can we really say that if IT provides better technology, we create business value, in the form of profits or savings? Yes, no, maybe. How about this – it is because of better use of technology, we improve business processes of the company and therefore we create business value. In this predictive validity framework, the middle action is called, mediating variable. It stands between two variables and it is an effect of one variable and the cause to another. This brings us to iteration to our business-IT strategy. Let’s refer to this improved business-IT strategy as “Strategy B”.
Strategy B: “Create value by improving business processes through better use of technology”.
So how do you interpret this strategy? As an IT organization, your goal is to provide the business with the technology, infrastructure and applications to enable efficient business processes. This will result to business value creation through optimized cost, profitability and strategic advantage. Whew! Follow all that so far?
I think this business-IT strategy works. If you run this, you have a good chance of successful outcomes. But your aim is not to be just good. Your aim is to be great. Your goal is to differentiate your IT department and to support your enterprise to be the best performing company in its industry or to be the best performing company (period!).
The Missing Component to be great
So there is a missing component to your strategy, a moderating component—a component that will have a multiplying effect from certain causes and effects coming out from the collective work that you do. In this predictive validity framework, it is called the moderating variable. The moderating variable is a variable that determines how big an effect you get from a certain cause.
To illustrate, let’s say you want to improve your performance at playing basketball. By practicing basketball, doing drills and shooting, for sure it will improve your performance. This is a very simple causal model. You practice more and that, in effect, will improve your basketball performance. But think about this, is there a certain amount of practice that will allow you to be like Mike (Michael Jordan)? Most likely, no. Talent and perhaps physical capacities are the moderating variables here. Sure, practice will improve your performance, but if you have a lot of talent, a little bit of practice goes a long way and will make you much better. If you don’t have that much talent, you’ll have to practice a lot to get just a little better. Talent in this case is a moderating variable.
Now that you understand what a moderating variable is, let’s go back to our Business-IT strategy. Think about an organizational capability equivalent to talent that can potentially transition your IT organization from good to great—it is business relationship management (BRM).
BRM in this case is a moderating variable. The BRM capabilities moderate the effect of improvement of business processes on performance, making it bigger (high Business-IT alignment) or smaller (in cases where it is lacking). Improved business processes doesn’t cause BRM capabilities, it just moderates the effect. How? BRMs (1) facilitate Business-Provider convergence, (2) ensure that use of IT services drives value and (3) facilitate productive and connections and mobilize business-IT projects and programs.
For many years, IT organizations responsible for deploying technology systems to enable enterprise processes have had one goal in mind – namely, to assure business-IT alignment. Today, however, as IT capabilities become more and more embedded in business capabilities, and given the pace of technological change and the pervasive nature of IT, alignment is no longer sufficient. The goal today, therefore, is “convergence”. This has given momentum to the growing emergence of the Business Relationship Management (BRM) role, which, according to the Business Relationship Management Institute (BRMI), is about “stimulating, surfacing and shaping business demand for a provider’s products and services, ensuring that the potential business value from those products and services is captured, optimized and communicated.”
Building trust is vastly different from trying to establish who is right. It is about committing to, and working to achieve outcomes that people are willing to stand behind.
Never put yourself in a position that could lead others to question your character, your trustworthiness, or your integrity.
Think about jobs you have had or you currently have. When you trust the people you work with—your boss or the company leadership, for example—not only are you highly engaged but you also enjoy what you are doing; and you do everything you can to bring success to the organization. More importantly, when people trust each other, they take ownership of their environment and hold themselves and others accountable. On the other hand, when someone’s integrity, character or trustworthiness is put into question, the whole organization is negatively affected.
“Hearts and Minds” or “Renting Labor”—Why Trust Is Critical in a Healthy Organization
This lesson is about building trust, keeping trust and (occasionally) having to gain back trust. Trust is the groundwork of all relationships, especially of good functioning teams. It is critical for effective communication and employee engagement. It is a major factor of employee retention, and employee motivation and contributes to discretionary energy, which causes employees to go “above and beyond”. When trust exists in the workplace, everything else is easier to achieve. You can cultivate a culture in which people think performance, quality, and exceptional service—but there’s a big difference between these efforts resulting from the basis of trust; or from simple compliance. Results coming from a “trustworthy” organization resonate better with the market or with external entities. People want to patronize your products and do business with you if they trust you.
Once trust is broken, it’s said that it can never be regained. When this happens in the workplace, the relationship can take a very long time to mend. Productivity and efficiency is affected because the parties involved become guarded and suspect “hidden agendas”. However, honest mistakes will happen and these experiences also produce valuable lessons. Because trust is a core foundation value, never put yourself in a position that could lead other people to question your character, trustworthiness, or integrity. The process of building trust, character and relationship takes time, but can be destroyed in an instant.
In the workplace, there should be certain people we are able to trust without reservation: one of them is our manager. Managers build that trust by fulfilling accountability. This includes accountability to create a better and safer workplace; to have the best processes and tools to run the business and enjoy competitive advantage; and to expand opportunities for employees. We shouldn’t have to doubt the motivation behind managers’ decisions because there should be no motivation other than doing what is in the best interest of the company—based on company values and objectives.
However, in a workplace environment it is unavoidable that perceptions of unfair actions, inequities in various forms, and conflicts of interest may arise. In these situations, building trust is not easy. Successful trust-building in the work place hinges on three elements: clarity of purpose, open communication and a win-win attitude.
1. Clarity of purpose is represented by the company’s vision and purpose.
It is the structure of any organization. It is what keeps it moving forward with direction. It provides meaning to the day-to-day challenges. Building trust is vastly different from trying to establish who is right. It is about committing to, and working to achieve outcomes that people are willing to stand behind.
2. Open Communication is important in any relationship building.
It is also important in maintaining trust. How effective communication is in the work place is key. This is particularly important when implementing difficult decisions—for example, reorganizations, which potentially (and naturally) creates a certain level of distrust between leaders and employees. In order to address this distrust, leaders need to show their employees that the reorganization is for the good of the company (and its employees).
3. A win-win attitude approaches work as a collaborative endeavor, not a competitive one.
This attitude creates trust as both parties seek mutual benefits in interactions. Win-win means agreements or solutions are mutually beneficial and satisfying. A person or organization that approaches conflicts with a win-win attitude develops vital character traits and strengths such as integrity, trustworthiness and collaboration.
Work-life Lesson 8 Takeaways:
- The best way to maintain trustworthiness is to keep away from breaking trust in the first place.
- Successful trust-building in the work place hinges on three elements: clarity of purpose, open communication and a win-win attitude.
- Building trust is vastly different from trying to establish who is right. It is about committing to, and working to achieve outcomes that people are willing to stand behind.
About the collaborators:
Ira Fialkow is the SVP of Member Services at Peeriosity. Prior to this, Ira was EVP of Shared Services at CEMEX and Rinker Group (acquired by CEMEX is 2007) from 1990 through joining Peeriosity in October 2010. Rinker Group was the initial recipient of the Best Mature Shared Services Award in 2003. Ira lives in Palm Beach Gardens, Florida and has been the champion of his fantasy football league in three of the past five years.
Ivy Remoreras is a marketing professional with eight years of extensive experience, particularly in product management, communications and promotions as a manager, university instructor and consultant. She believes in constant learning and has a Masters degree in Business Administration (MBA). Having resided in Europe, Asia and North America, she speaks four languages.
Photo courtesy of Renjith Krishnan
“Relocation is stressful. You as a person change more than your address, regardless of how often you do this. You’ll begin to navigate the new culture, appreciate the new place, make new friends, find your comfort zone in your new office, and more. The hardest part is moving on and leaving it all behind.”
Would you believe it if I told you I have changed residences 10 times in the last 10 years? If you have experienced relocating, you know what it takes to move from one place to another. This relocation madness involved 4 countries in 3 continents. Just last year, our twin boys were born in South Florida and here we are, 11 months later, living in South Texas.
All the relocation is from the same company I have worked with for 13 years now. I am a pretty loyal soldier, don’t you think? I have allowed my superiors to move me where they need me. During the expansion years of the company, I was relocated because of post merger integration projects. I have always been open to relocating, even though I know it is hard. The last one though, with the infant twins, was the hardest one so far. (So I hope this is the last move in a while.)
Does this make me a relocation expert? Of course! Nothing beats experience and going through a complicated process repeatedly in a short span of time. I am sure my wife is an expert at this too– even more than me. We have attended relocation and cultural training countless of times in different countries to prepare us for every transfer. She has been more engaged in the process because she is more hands-on with it. Usually, before we are relocated, I would have been travelling back and forth between home and the city we were moving to. I would have spent a lot of my time in the new place at work already and be familiar with the new city. In my wife’s case, she usually gets to be in the new city only when we are actually relocated.
Here are some things that I have learned in these 10-years of relocation madness that might help you, whether you are thinking of relocating or are in the process of doing so.
First of all — and I will be honest and straightforward here — relocation is stressful. You as a person change more than your address, regardless of how often you do this. You’ll begin to navigate the new culture, appreciate the new place, make new friends, find your comfort zone in your new office, and more. The hardest part is moving on and leaving it all behind. So before you decide to relocate, make sure you are really decided on doing it. Relocating is no easy task. You need to make your decision with your family (and friends) and weigh your options very well. You can liken this to preparing for a hike and you need to pack your first aid kit and safety equipment. So the first point in relocation is, pack your emotional first aid kit first.
Look-and-see visits are important. This is when you travel to the new place to give you an idea of the culture, people, neighborhood, and more. In my case, often I did not get to use it because I was already familiar with the new place from frequent business trips. For your spouse, it could be a critical part of the process. It is just like when buying a car, you don’t just talk to a salesman before you make the decision. You test drive the car around the block.
Last but not the least, understand and take advantage of your relocation package (if you have one). It is not cheap to relocate. If your company is moving you, make sure your moving cost is covered. This will ease a lot of stress. Usually, company packages include a relocation bonus to cover incidental expenses of the move, a look-and-see visit, support in moving household goods, cultural training (especially when moving to another country) and assistance in finding your new home, etc. If you are doing this by yourself, be prepared financially. Research what you need, service providers (movers, real estate agents, banks,and the like) you need and how much it costs. Make sure you can afford it. You don’t want money issues to be an additional burden to an already emotionally stressful process.
(It’s been a while since my last post…now you know why, we just relocated again!)
Photo by Crafty Joe
I have long been intrigued by the series Undercover Boss (currently shown in CBS) but never got the chance to watch it— until last Sunday. I am so happy I did. I learned a lot of business insights from the one and only episode that I have watched so far. I just saw a replay of an episode that was first aired in February 2010. It’s the one where Joe DePinto, CEO of 7-Eleven, goes undercover in his own company by working in different operations jobs. Among DePinto’s responsibilities were: working the night shift, making donuts, and driving a delivery truck.
DePinto tells his executive team before embarking on his temporary assignments:
“I’ll be focusing on spending time in the field, where the rubber meets the road. I’m going to see what we’re not doing well, and that’s only going to make us better in the long run.”
In the end, Joe DePinto witnessed a lot of great and inspiring things from ordinary employees of varying backgrounds and at the same time he saw some areas of opportunity. I think his undercover stint was a worthwhile learning experience for him and will only improved the way he manages 7-Eleven. Here are seven management lessons that I learned from this Undercover Boss episode:
DePinto’s first stint as undercover boss was in Shirley, NY where he worked the early morning shift at the store that sells the most coffee among all the 7-Eleven stores. He wanted to understand the secret as to why this branch was selling more coffee than other stores. Here DePinto met Dolores — 7-Eleven employee for 18 years. He saw her passion and dedication despite her sickness; she has only one kidney and has to undergo dialysis every single day. What’s amazing was how Dolores knew all the customers by name and greeted them affectionately. She showed an up-beat and positive attitude all the time. DePinto quickly realized that the reason why that store was selling 2,500 cups of coffee per day was because of Dolores and her relationship with her customers — definitely not just because of their coffee.
2. Replicate what works
By going undercover, DePinto discovered what he set out to discover. He learned and observed first hand how Dolores’ personal relationship with her customers brought them back to her store again and again. DePinto wanted to replicate the success of Dolores’ store in order to improve 7-Eleven’s business in coffee sales. Duplicating what Dolores does is not an easy task, but if 7-Eleven can develop a customer service culture patterned after how Dolores treats her customers, it could work!
3. Know your employees
DePinto’s next stint was working at 7-Eleven’s largest bakery in Baltimore, Maryland. Here he was trained by Phil, the shift supervisor and aspiring artist. DePinto was visibly impressed byPhil’s talent as he was shown a sketch pad-full of great drawings inspired by, what else, donuts. This casual encounter in the break room led DePinto to spot a talent that could be harnessed by the company’s marketing department. Just like DePinto, I think managers should seek to know more about their employees and discover their other talents and capabilities. They must be open to harness these talents if it creates mutual value for the employee and the company. Providing employees the training and opportunities to showcase their other talents is a win-win situation for the company and its people.
4. Employees can inspire management
The last day of Undercover Boss finds DePinto working with Igor on a delivery truck. Igor, an immigrant from Kazakhstan, inspired DePinto with his humble story. DePinto affirmed Igor for his hard work, can-do attitude, and passion for the job during their meeting at the company’s headquarters when he finally revealed himself as the CEO. Igor replied, “I can’t say anything, I’m just doing my job.” Igor talked passionately about his “American Dream” and how grateful he is to be living it. He told DePinto how he and his wife work only see each other during the weekends because of Igor’s night shifts. Igor’s inspiration and dedication was rewarded— he is now managing one franchise for 7 Eleven.
5. Communication is key
Remote operations and thousands of franchisees makes the communication of programs and messages challenging for companies like 7-Eleven. During the show, DePinto was surprised to find out that one store routinely trashed day-old bakery items which were supposed to go to charity. He was visibly disappointed that these items — that should have been sent to charities as per company policy — were being thrown into the trash. It showed his real concern for the homeless and hungry. However, he understood that it was a case of miscommunication and it something that can surely be improved through better coordination and communication from the head office.
6. Support your frontline
In addition, the episode showed one store that needed to replace many of its lights in the store area and in the storage area. It was one of the chain’s highest grossing stores and its lights had been out for some time. It not only negatively affected 7-Eleven’s image to its customers (the store did not seem well-maintained due) but was also a potential safety hazard for the employees. DePinto, as “Danny” the entry level employee, was actually tasked to call maintenance and request for the lights to be changed. As “Danny”, he was told that it was a low priority request and the store’s lights can only be fixed in 30 days during the monthly maintenance visit. DePinto had to call his chief operations officer to prioritize the maintenance job. How we support our frontline is important to our business. They are the people that serve our customers directly. Managers need to know the reality of what’s happening in the field in order to make more sensible decisions according to the situation in the frontline.
7. Great people make great companies
While working on the donut production line, DePinto couldn’t keep up with the speed of the conveyor belt. This was until his trainer, Phil, showed him the trick to doing it more efficiently. That’s the case with every task in business, no matter how big or small and strategic or operational. In another segment, DePinto asked Waqas — a young Pakistani who served as boss for the night — about career plans and discovered that Waqas doesn’t consider his job at 7-Eleven to be a “career.” Waqas works the night shift in order to finish his college education during the day. Despite earning a college degree, Waqas views his position in 7-Eleven as a dead-end job because there are no opportunities for him to move up in the company. DePinto was saddened to hear this. The CEO felt that an employee who has already worked four years for the company and is working for higher education should feel that they have other possibilities and opportunities within the company. DePinto went to say, “Great people make great companies; we can’t let them think their jobs are dead-end, we can’t win without our great soldiers.”
Image courtesy of 7-Eleven.