Management Takeaways from a Strategy Session

I recently ran a strategy session for the top management of a national company. I decided to share some of the takeaways, which I believe can be applied in any organization. Many of them are not entirely obvious, but over time you come to see that they work.

Change takes repetition. Any transformation can become real change only if it is repeated 84 times. So when we expect change from those around us, whether partners or employees, we need to repeat the message 84 times. Sometimes it can take up to 7 years to achieve change in a company, and in general a transformation requires at least 1.5 years.

To accept is not to agree. Often, when someone disagrees with a colleague's position, he does not help; he tries to obstruct the implementation of that colleague's plans in an effort to prove that he is right. This makes the system unproductive. To avoid this, we ran exercises built on one rule: if a decision has been made in line with the principles agreed in the company, everyone who disagrees accepts it and does everything possible to deliver the result. It is a difficult practice, but it is very important for top managers.

Keep your promises on bonuses. If employees were promised a bonus for their performance, you must always honor that commitment, even if you were not the one who made the decision. Otherwise you will end up with resentful, demotivated staff. If the wrong incentive system was set up or the wrong indicators were chosen, that is not the employee's fault. He has no influence over it, and it is vital to honor all agreements, because an employee works within a system and signs a contract with the organization, not with a particular person.

Tie bonuses only to what employees can influence. Always set goals and bonus metrics only for things the employee can affect. If he has no influence over the result he is paid for, that incentive will not work. It is money wasted, and the employee will not be motivated. For example, many companies set a branch's profit, after allocation of head office costs, as a target. A branch director has almost no influence over the branch's financial result: he does not control head office costs, does not set prices, does not handle procurement, does not affect salary levels and does not influence processes. So this indicator will not motivate him, and it is very vague.

It is normal for a specialist to earn more than his manager. This is called horizontal growth. Employees should be given the opportunity to grow both vertically and horizontally. Many people cannot accept this and try to make sure that the manager earns more than his subordinate. In fact, not everyone wants to be a manager, but many want to be truly outstanding specialists. Give your employees the chance to earn more than their manager, and you will get a powerful boost in motivation and widen the opportunities for career growth.

Culture drives change. Corporate environment and culture are the most important factor in changing a company. If you do not pay attention to corporate culture, your changes are unlikely to be significant. Culture changes from the top. You cannot demand change from employees if you are not willing to change yourself.

Do not punish honest mistakes. Never punish employees for mistakes that were not made deliberately. This encourages employees to create without fear of being punished for failure. This is how great products and processes are born. Initiative should never be punishable.

If you are interested, I will continue to share my thoughts on this topic, drawing on my experience.