Tequila and a very Meaningful Conversation with Michael

tequila

Tequila has never been a good friend to me and to be honest with you I have never really understood the drink, only to say occasionally an ice-cool margarita can be very inviting especially in hot weather.

If you’re anything like me, early memories of tequila drinking bring back foggy images of high school house parties a la Tom Cruise in “Risky Business.” Some of you might remember staring at the lifeless worm floating sadly on the bottom of a bottle, and wondered, who would drink that? Many of you still wince and cry, “It burns!”

On a recent visit to Oregon, my business partner and good friend Mark Herbert, decided to introduce me to Michael Bailey, who frankly is an expert in tequila. We arrived at Michael’s house, deep into the Mohawk Valley, where he showed us around his vast tequila collections, where this tequila cannot be purchased, my curiosity did get the better of me, there was no Patron tequila in his collection, not even Patron ultra-premium, no salt and no lime, just tequila.

Also, tequila does not have a worm in its bottle. The worm, or guano, is associated with mezcal. In the 1940s, a few brands started a marketing ploy attributing aphrodisiac and magical qualities to the worm and the person shooting it. As you can probably guess, ingesting the worm has no effect on desire, nor are fine bottles of either tequila or mezcal sold with a worm in it.

The word tequila comes from the Nahuatl (Aztec) language and translates to “the place where plants are harvested,” or possibly “the place where a lot of work is done,” according to Jose Maria Muria in his book, “A Drink Named Tequila.” And that pretty much sums up the sentiment behind tequila: A plant, a place and the people who make it, Michael believes that the word Tequila has a translation of ‘The Stone That Cuts’.

Michael started to discuss the subject of Hollywood actor George Clooney and his recent investment into tequila, ‘when George Clooney and Rande Gerber’s tequila company, Casamigos, sold for $1 billion last year, it begged the question: that there really so much money in tequila.

In the Guadalajaran skies, desert heat, verdant blue-green leaves, distilled down via an ancient recipe into a crystal-clear, power-punch of a spirit. The roots of our most beloved, hangover-inducing inebriant go all the way back to the 13th century.

Agave was an important part of life in pre-Hispanic Mexico: the dense fibres were perfect for mats, ropes, possibly wigs, but people also had another use for the plant: they loved to booze around with agave juice.

Pulque was their favourite drink, a fermented, milky coloured, yeasty agave juice concoction that pre-Aztec civilisations had the good sense to distil. North American fascination with tequila began during prohibition, and surfaced again in the Second World War when European spirits were hard to come by.

Agave – The Cultivation of the Tequila Tradition

The History of Tequila

The town of Tequila was founded in 1656 in what is now the Mexican state of Jalisco. It didn’t take long for tequila to be produced throughout the country and Jose Cuervo was the first to commercialize the product. The late 1800s saw the first exports to the United States and the following Mexican Revolution and World Wars added to the international popularity of tequila.

Tequila can only be made within particular regions of certain Mexican states. They include 124 municipalities of Jalisco (including the town of Tequila and the majority of modern tequila production), 8 municipalities in Nayarit, 7 municipalities in Guanajuato, 30 municipalities in Michoacan, and 11 municipalities in Tamaulipas.

Mark and I were hugely curious, sipping gently on our first Margarita, ‘so Michael how is tequila made?’

Good question guys, tequila is made by distilling the fermented juices of the Weber blue agave plant with water. The agave is a member of the lily family and it looks like a giant aloe vera plant with spiked barbs on the tips. After seven to ten years of growth, the agave plant is ready to be harvested and used in the production of tequila.

Underground, the plant produces a large bulb called a piña, which looks similar to a white pineapple. The agave’s spiky leaves are removed and the piñas are quartered and slowly baked in steam or brick ovens until all the starches are converted to sugars. The baked agave is crushed in order to extract the plant’s sweet juices, which are then fermented.

100% Agave vs. Mixto: According to Mexican law, all tequila must contain at least 51 percent Weber blue agave (Agave tequilana). Really good tequila, like the one you are drinking, is 100% Weber blue agave and will be clearly marked that way on the bottle. The law also requires them to be produced, bottled, and inspected in Mexico.

Tequila that is not 100% agave is called mixto (mixed) because it is blended with sugar and water during distillation. Mixto tequilas can be produced outside of Mexico. Until around the turn of the 21st century, mixtos were the main tequilas produced. Today, the majority of the tequila you will find is “Tequila 100% de Agave.”

Tequila is distilled in either pot or column stills until it reaches around 110 proof. The result is a clear spirit with a significant amount of congeners. These congeners are by-products of alcohol fermentation that are often thought of as impurities which may lead to more severe hangovers.

Some tequileros (tequila producers) re-distil the tequila to produce a cleaner liquor. Before bottling, the distillate is cut with water to obtain the bottling strength, which typically is around 80 proof, or 40 percent alcohol by volume (ABV).

Some tequilas are clear and are called blanco or silver tequila. Others take on a brown color due to one of two possible sources. Gold tequilas often get their colour from the addition of caramel or other additives. Reposado and añejo tequilas obtain their golden-brown colour from barrel ageing. Some tequilas are flavoured with small amounts of sherry, prune concentrate, and coconut, though these are not “true” tequilas, but “tequila products.”

The recipe for tequila is startlingly simple. All you need is agave, yeast and water, a few years for your crops to mature, oh, and a donkey or two. Jimadores (agave farmers) harvest the piña (heart) from the centre of the huge Weber blue agave at the perfect point in its life cycle (by all accounts, a rare, almost esoteric skill passed down through generations).

The piña is chopped up and gently steam-baked in a brick oven for a few days (or in an industrial pressure cooker for shorter cook time) and – slowly – the heart softens as the starch turns to sugar. The cooked piña is shredded like pulled pork, then crushed (often on a stone wheel, sometimes by donkeys) to extract the aguamiel, or juice, which is poured into heated wooden tanks.

The nectar ferments for a week or two – the yeast found naturally in the leaves of the agave plant is traditionally used to speed up the process – and then it’s distilled two to three times, water is added and it’s aged in wooden tanks or vats.

Each producer’s distillation process, ageing time and vessel give the tequila its unique flavour notes and aroma. It takes between 14 and 21 days to create the perfect white, clear-as-crystal tequila, while ageing the spirit for two months creates a pale gold tequila, drawing in some of the flavours and hues of the wood. Ageing the spirit from two to 364 days creates reposado (rested) tequila, and one year and beyond is known as anejo or aged tequila (and it’s delicious).

Before I make you both another Margarita, we are going to try all the 5 types (Tipos) of tequila, so you can fully understand the variables in taste, colour and quality of tequila, they are:
Blanco, Silver, or White Tequila (Tipo 1): Blanco tequila is a clear spirit that can be either 100% agave or mixto. These tequilas are “aged” — more like “rested” — no more than 60 days in stainless steel tanks, if they are aged at all. The unaged blancos give the drinker the rawest taste of agave available and have a notable earthy flavor that is distinctly tequila. If you have not tasted a blanco, then you are missing out on the pure taste of the agave plant.

Silver tequila is primarily used for mixing and is perfect for almost any tequila cocktail and often smoother than the gold tequilas shots. If you are looking for a quality, affordable, all-around tequila to keep in stock, a blanco is your best option.

Joven or Gold Tequila (Tipo 2): Joven (young) or oro (gold) tequilas are the ones that many older drinkers are familiar with, particularly if you spent any time doing tequila shots in the last few decades of the 20th century. Gold tequilas are responsible for many bad tequila experiences and were the most widely distributed in the U.S. during that time.

These are often unaged tequilas that are typically mixtos and have been colored and flavored with caramel, oak extract, glycerin, syrup, and other additives. While many gold tequilas leave something to be desired in comparison to the other classes, there are now a few decent bottlings available. If you are going to drink a gold tequila, stick to heavily flavored cocktails or (if you must) shots.

Reposado Tequila (Tipo 3): Reposado (rested) tequilas are aged in wood casks for a minimum of two months and many are aged from three to nine months. The barrels mellow the flavors of a pure blanco and impart a soft oak flavor to the agave as well as giving the tequila its light straw color. It has become popular for distilleries to age their tequilas in used bourbon barrels, which adds another dimension to the finished taste.

A little more expensive than blancos, reposado tequilas are the middle ground of the three main types found that are now pretty standard in a brand’s tequila line-up. They are versatile enough to be used in a great number of tequila cocktails, particularly those that have lighter flavors like the margarita or tequini. Reposados also make great sipping tequila.

Añejo Tequila (Tipo 4): Añejo tequila is “old” tequila. These tequilas are aged, often in white, French oak or used bourbon barrels for a minimum of one year to produce a dark, very robust spirit. Most añejos are aged between 18 months and three years while some of the best can spend up to four years in barrels. Many tequileros believe that aging longer than four years ruins the earthy flavour tones of the spirit.

Añejo tequilas tend to be very smooth with a nice balance of agave and oak. You will often find butterscotch and caramel undertones, which makes these perfect for sipping straight (chilled if you like) or for those really special cocktails.

You can liken an añejo to a high end brandy or whisky. Try these tequilas in a snifter to get a real sense of their aromas and flavours. As might be expected, añejo tequilas are some of the most expensive on the market, though there are many reasonably priced options available.

Extra-Añejo Tequila (Tipo 5): The change in the tequila market of recent years has led to the creation of a fifth type of tequila, which is labeled extra-añejo or muy añejo (extra-old).

These tequilas spend over four years in barrels and have a profile that rivals some of the oldest whisky you can find. Logically, the price of these tequilas reflects their extra time in the barrel and these are ones that you will want to save for straight sipping, enjoying every second of the experience.

Mark and I finished our last tequila with Michael, thanked him for a wonderful afternoon of tequila, home-made Margarita’s and phenomenal learnings, thankfully our taxi was on hand to drive us home.

So, what did I learn, one hundred percent agave tequila is made for sipping and savoring from a snifter, like a good scotch. No lime or salt is necessary to mask the flavor. (The more aged a tequila is, the more mellow the flavor, so opt for darker-colored añejo or reposado.)

After every sip or two you can dip a wedge of lime into a little salt and suck on it if you want to, but if you’re drinking mezcal skip the lime and opt for an orange slice instead.

If you find yourself at a great tequila bar that really means business, you can see if they have any sangrita, which is the only real “chaser” that Mexicans drink with tequila. It’s a sweet and spicy mixture of citrus juices, hot sauce, and sometimes tomato juice and/or Worcestershire.

It’s served in a small glass alongside the tequila, and when sipped in between sips of tequila, it cleanses the palate and highlights the tequila’s peppery and citrusy taste.

And if you’re looking to drink tequila in a cocktail, do as the Mexicans do and mix it with grapefruit soda (like Fresca) to make a refreshing Paloma.

Michael’s Margarita was super easy, delicious and possibly the best Margarita, I have EVER tasted, one part juice made from fresh oranges, one part juice made from fresh lemons, ice, Michael’s special tequila, ice and for taste coriander – AMAZING!

Statistics show that the United States is the largest consumer of tequila. In addition, the US demand for tequila is increasing year by year. Spain and Chinese demand for tequila are increasing at a very high rate.

Tequila has very strict requirements for raw materials. A mature blue agave requires a minimum of eight years, which limits the total production of tequila.

In 2017, the global tequila market size was 4.660 million US$ and is forecast to 6.360 million US in 2025, growing at a CAGR of 4.0% from 2018

Michael believes that tequila is a fine drink that enchants us all from the very beginning. It needs to have that certain ’WOW’ effect. It was very hard work, but at the end of the day there are many tequilas with an incredibly smooth finish. Like alchemists, you need to search for a tequila that when first sipped you will experience a magic moment.

As Rainbow Rowell, an American Author once said:

“Drinking tequila is more about the journey than the destination.”

Purposeful Driven Discussions with Mark Herbert

Every year, I travel to Oregon to visit my business partner, Mark Herbert, to discuss cross border challenges and to hold meetings with his team, my relationship with Mark and his team is a good example of a ‘special relationship’ that has grown from strength to strength over the last decade. We always discuss US to Europe and the effects on business and personnel who hold office.

Mark and I had quality time to discuss many subjects and in particular working in an increasingly fast-paced and ever-changing world, and the rationale behind my new book ‘Purposeful Discussions’.

Mark Herbert

We decided to take a road trip to the beautiful town of Brownsville, originally known as “Calapooya” after the area’s original inhabitants, the Kalapuya Indians, or “Kirk’s Ferry”, after the ferry operated across the Calapooia River by early settlers Alexander and Sarah Kirk.

When Linn County was created from the southern portion of Champoeg County on December 28, 1847, the Provisional Legislature named Calapooia as the county seat. Brownsville was named in honour of Hugh L. Brown, who settled there in 1846 and opened the first store. In the mid 1980s Brownsville assumed a modicum of international notoriety as the location set for the film ‘Stand by Me‘, directed by Rob Reiner. The film was shot in and around the community in June and July 1985 (and Richard Dreyfuss, whom I blogged about 2 weeks ago, plays in it).

It was a hot day driving through some of the back roads in Mark’s Porsche convertible, I started to ask Mark about purpose-driven outcomes in business, to which he responded: ‘Great subject Geoff, you could question to wonder too openly, or intensely, about the meaning of life sounds like a peculiar, ill-fated and unintentionally comedic pastime. It isn’t anything an ordinary mortal should be doing – or would get very far by doing. A select few might be equipped to take on the task and discover the answer in their own lives, but such ambition isn’t for most of us.

Meaningful lives are for extraordinary people: great saints, artists, scholars, scientists, doctors, activists, explorers, national leaders…. If ever we did discover the meaning, it would – we suspect – in any case, be incomprehensible, perhaps written in Latin or in computer code. It wouldn’t be anything that could orient or illuminate our activities. Without always acknowledging it, we are – in the background – operating with a remarkably ungenerous perspective on the meaning of life.’

I responded by saying ‘it is my belief that an important part of empathy is the ability to trust and be trusted. When your employees feel that you care, then you have earned their trust. If they trust you, they will take more risks with you and be more open with you. People will talk openly with you only when they trust you. As trust builds, there will be more sharing of information, feelings, and thoughts. The more you share, the easier it is to relate to one another. Building trust is something that takes time and effort. It involves both you and the other person in the relationship. The level of trust is what makes each relationship unique.

So how do you build a trusting relationship with someone?

Mark answered by exercising five ways to build trusting relationships:
1. Learn to trust others
2. Earn the trust of others
3. Share information, thoughts, and feelings
4. Show weakness and take risks
5. Be personable

It is true, if you want to develop your organisation’s culture around purpose, it’s hard to imagine anything more critical to your success than trust. Yet, unfortunately, trust is sorely lacking in workplaces in the US and Europe, if fact across the globe, reflecting society’s growing distrust of business, government and other vital institutions.

How big is the trust gap? I recently read The 2017 Edelman Trust Barometer, which found that just 37% of respondents find CEOs to be credible spokespeople, down 12% compared to 2016. Trust in employees is also falling. Edelman found that 48% of respondents found employees trustworthy, down from 52% in 2016. In fact, for the first time, a majority of global respondents say that they no longer trust “the system” – government, media, business and institutions – to work for them.

It’s clear there’s a crisis of trust brewing. Yet, there’s hope for companies that pursue purpose transformation, for it is only by being trustworthy that we can gain the trust of employees, customers and others who are invested in mutual success. In my continuing series of interviews around culture and purpose, I spoke with five experts on workplace relationships who shared their ideas on why trust is integral to purpose transformation.

Mark went on to say ‘organisations, values play another vital role’. “Values prevent teams and individuals from giving into that short term, numbers-oriented mentality, which is so prevalent in many publicly traded organizations,”. “We have to give up the notion that it’s okay for work to be unsatisfying; that it’s simply an obligation versus something we feel fulfilled and passionate about doing. We as individuals have to change our beliefs; that’s what really changes the organisation.”

The ability to trust your team to embody your values is the foundation for a successful purpose transformation. After all, you can expend a lot of energy defining purpose and values, but if you can’t rely on your team to embody them, then it won’t impact how teams interact with customers and each other, and it won’t impact how business gets done.

Values should drive decision-making, especially around hiring and retention. Organisations must hire people who believe in the organisation’s purpose, and who embody the values you want to see in the organisation.

I continued to question, ‘so how do you build a trust-based workplace? Mark responded, inspiring trust is about walking the talk and great storytelling, “As a leader, you build trust by making yourself available, listening to questions. You have to listen to your customers and your people, and recognise the questions people have.”

Final thought, it might not seem like trust would be such a crucial component of building a purpose-driven organisation. But in truth, it’s trust – between employees and managers, managers and executive leaders, and customers and those within the organisation – that gives purpose and values the power to transform.

To be successful in today’s dynamic business environment, leaders must work toward building relevance, managing business fundamentals with a balanced approach and guiding employees through open, two-way communication. Those leaders who leverage opportunities to adapt, innovate and learn can make ever-changing times invigorating and advantageous for themselves, their employees and their organizations.

A great quote by Howard Schultz sums up our thinking on this incredible roadtrip, when he said:

“When you’re surrounded by people who share a passionate commitment around a common purpose, anything is possible.”

Parallels between corporate environments and hummingbirds – hummingbirds return to places where there is positive energy

I recently paid a visit to Silicon Valley, California for an executive board meeting and aligned this trip to visit my international business partner in Oregon, Mark F. Herbert, for my yearly catch up, cross border strategic discussions and many “Meaningful Conversations”.

Whilst having a Meaningful Conversation we could not help but see a group of very excited hummingbirds, so we started to provoke thought and discussion across the possibilities and parallels between corporate and that of hummingbirds.

Mark and I sat there and then I said, ‘so why is a hummingbird so positive with energy? Hummingbirds should not physically be able to fly, and like these birds that always defy the “impossible,” ‘Mark stated to discuss that hummingbirds are among the smallest of birds, most species measuring 7.5–13 cm in length.

The fact that the hummingbird is the smallest extant bird species, the 5 cm bee hummingbird weighing less than 2.0 g, and these little winged wonders flutter their wings at a remarkable 80 times per second. Hummingbirds have essentially been reinventing themselves throughout their 22-million-year history’, which made me think of how us humans have so much to learn from these amazing little birds.

Then, there is the migration each year a hummingbird will fly from North America, in January or February to South or Central America proceeding at an average rate of about 20 miles per day, the northward migration is complete by late May. Banding studies show that each bird tends to return every year to the same place it hatched, even visiting the same feeders. The Rufous has the longest migration route of all hummingbirds—up to 3,000 miles (4.828km)—traveling from summer in Alaska to winter in Mexico.

Hummingbirds have so much association, they are associated with goddesses throughout the myths and legends of multiple cultures. In one Mayan legend, the hummingbird is the sun in disguise, trying to court a beautiful woman, who is the moon. Hopi and Zuni legends tell of hummingbirds helping humans by convincing the gods to bring rain.

An Aztec legend tells of a god who, in the form of a hummingbird, flew to the underworld to be with a goddess, who later gave birth to the earth’s first flower. A Native American hummingbird animal totem is said to aid in self-discovery and provide us the paths to self-expression and awareness
Hummingbirds can only be described as Agile and Adaptable!

The Oxford dictionary meaning of Agile is Nimble, Supple, Dexterous, Acrobatic, graceful. Qualities that organisatios and leaders today certainly look at building, being and demonstrating.

It seems to me that there are leaders who are more like hummingbirds in their approach to life and leadership.
As a leader your attitude will make you or break you. The right attitude can guide you through times of adversity with poise and grace and be a source of inspiration for others to emulate. And at the end of the day it is all about the daily decisions you make.

Here are four considerations for a good positive attitude.

1 – What you choose to see. As you look over the landscape of your business or organisation do you see recession, fear and uncertainty or do you see opportunity, growth, and new markets?

What you choose to see speaks of your perceptions. Your perceptions are shaped by your attitude. That is not to say you are not mindful of the negatives that exist but you are making a choice not to be defined by them. If you are going to have an attitude of excellence it begins with what you choose to see and ignoring the rest.

2 – What you choose to believe. By its choice the hummingbird chooses new life and growth over what is dead and gone. Your belief systems form the foundation of your personal growth and that of your leadership potential. What you choose to see formulates your perceptions but your beliefs formulate how you live. This attitude is the deal breaker both personally and professionally and it truly matters.

What you choose to believe speaks of your passion. Your passions are a reflection of your attitude and that is a reflection of your heart. What you choose to believe may not always make sense at the time. Yet when you choose faith over fear, hope over despair, trust over doubt, forgiveness over resentment, and love over hate, you are living out an attitude of belief that will set you apart as a leader.

3 – How you will spend your time. The hummingbird spends its time seeking life and beauty. When your attitude is aligned with what you believe and what you see it makes how you spend your time an easier proposition.

How you spend your time is all about priorities. Whether in business or in your personal life your priorities are a good indicator of a healthy attitude. Your time is your most valuable possession and a smart leader learns how to master it.

4 – How you will live your life. The vulture and the hummingbird, for better or worse, have made their choices and live their lives accordingly. Your attitude as a leader has consequences that will determine your altitude. The choice to have a good attitude is not always easy. Someone cuts you off in traffic, the deal you thought you were going to close doesn’t happen, your earnings report falls short of expectations; a friend betrays you; these scenarios and more constantly challenge your resolve to have a good attitude.

How you will live your life speaks of your purpose. Your attitude should be one of your strongest attributes that sustains you in the good times and what gives you the courage needed when times are tough. Make it your priority to live your life as a leader with purpose in your heart.

A final thought, let us take a moment to analyse the amazement of this little creature that have been known to some scientists as “An Impossible Miracle” and derive some lessons.

Hummingbirds are one of the smallest birds in the species. They can probably fit in your tall cup of coffee and weigh less than a tennis ball. They are one of the most adaptive creatures around. Having one of the highest metabolisms in any animal but can also go in a hibernation-like state to conserve energy when needed.

They are one of the most versatile animals on earth. The only bird that can fly both forward, backward, upside down and has the ability to hover in one place as needed. They are also one of the fastest animals on the planet with recorded speeds of up to 54km per hour. That is faster than some of the best race horses around. And, if you did not know, hummingbirds actually inspired the creation of the Helicopter.

There are a lot of things we can learn from the Hummingbird, both from the story and around the real facts about it.
Perseverance, Courage, Innovation, Adaptability, Versatility, and defying all odds.

As a human you always think about the experiencing the highest of highs and the lowest of lows, and we are all tested in ways that you never expect.

Leadership forces you to stay true to yourself and to recognise when you are at your best and when you are at your worst; the important thing is to stay focused and keep moving forward. We aleways learn that it is overcoming adversity that brings the most satisfaction, and that achievements are made more meaningful by the struggle it took to achieve them.

Like the hummingbird, anything is possible if you believe in yourself and if you set your mind and heart to it. If you want something badly enough, you must be prepared to go after it with everything you have, no matter what the odds.

Change has a funny habit of teaching you much about yourself; it goes to the core of your own weaknesses, strengths and eccentricities. Leadership forces you to stay true to yourself and recognise times when you are at your best and worst; the key is to stay focused and to make decisions that will look at continuous improvement. Even though this may be small, incremental change, it is positive change you can build upon even though you may be in quicksand.

The question is, how much do you truly want your dream?

As the famous scientist Charles Darwin once said:


‘It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.’

Do we have international differences in corporate governance and conduct?

There has been much discussion of late on the values of corporate governance in companies and more importantly the international differences in governance and agenda. As we both advise on company boards, I decided to speak to my business partner in the US, Mark Herbert, and create some joint thoughts on the matter.

Some of the questions we discussed:
“How do you know a board is effective?”
“Do you balance trust with challenging discourse?”
“Is the CEO engaged enough with the board?”
“How can the board challenge management with critical questions without engagement and collaboration?”
“Do you engage in a continuous improvement process?”

As you can imagine, our discussions were quite heated on leadership and at times in the lack of engaged leadership in business today.
The first matter we considered was: “Is there such a thing as a typical board of directors, since size and composition will vary according to a company’s needs?”

Board size can range from five to eighteen board members, though the average board size across Europe stands at about nine members. Regardless of board size, there are certain practices that should be followed to achieve optimal results. Overall, it is important to establish the desired board profile for your company by identifying the types of directors needed in relation to your business goals and ambition.

The composition of boards continues to be a focus for investors, and companies are responding by paying increased attention both to who sits on their boards and to enhancing their disclosure and engagement with investors. The data reported in the 2016 Spencer Stuart Board Index on S&P 500 boards highlights emerging practices, compiled from proxy disclosure and a related survey. Overall, the trends have stayed steady from last year but represent a meaningful departure from 10 years ago.

Directors sit on an average of 2.1 boards. 74% of boards have an over-boarding policy to limit the total number of boards on which directors may serve; 76% set it at three or four boards. Only 43% of CEOs serve on one or more outside boards, the same as last year, but more than a 10% decrease from 10 years ago.

Many companies regularly review the list of skills that are desirable on the board and match them with board members’ profiles. Directors’ “softer” skills and personalities should not be forgotten as they are instrumental in establishing appropriate board dynamics. When deciding on the composition of your board of directors, you should keep in mind the balance between the number of executive directors (board members who are part of the company’s executive team) and nonexecutive directors (board members who are not part of the company’s executive team). You may also want to consider having independent non-executive directors on the board.

On average, 49 percent of board seats in Europe are held by independent, non-executive directors. Such directors can bring real value to your company by providing new business opportunities and more independent, objective advice. They also can provide constructive criticism, to an extent which is unlikely to come from within the company. When thinking about your board’s profile, you should keep in mind the practicalities related to the size of the board. In other words, consider that the effectiveness of the discussion is impaired when there are too many people around the table. Larger boards of directors are not always the best source of constructive challenge or fresh ideas.

Generally common convention suggests that a board size of between seven to 10 directors is optimal for most companies. Equally important is the issue of gender balance. This issue has received a lot of attention recently, since women tend to be under-represented on boards. In Europe, in particular, this issue is pertinent, since only about 12 percent of boards have a female board member.

While public attention mostly focuses on governance for larger and listed companies, many business leaders of smaller companies understand that the fundamental principles of corporate governance such as transparency, responsibility, accountability and fairness are beneficial to all companies, regardless of listing status or size.

Corporate governance is crucial for increasing an SME’s ability to attract funding from both direct investment and credit institutions. Good governance is particularly important to shareholders of unlisted SMEs. In most cases, these shareholders are less protected by regulators, have limited ability to sell their shares, and are dependent on controlling shareholders. Accordingly, the higher risk implicit in owning a stake in an unlisted company increases the demand for a good governance framework.

Positive corporate governance changes have the impact of improving access to investment, allowing the company’s to access facilities of equity and debt. There has also been the additional impact of helping the company position itself for an eventual exit, trade sale or IPO, as the changes help send a signal to the market about the company’s emphasis on good governance.

Corporate management is the general process of making decisions within a company. Corporate governance is the set of rules and practices that ensure that a corporation is serving all of its stakeholders. According to the Center for International Private Enterprise, “Successful development efforts demand a holistic approach, in which various programs and strategies are recognized for their important contributions to progress and prosperity. In this regard, linkages between corporate governance and development are crucial… Yet, corporate governance and development are strongly related. Just as good corporate governance contributes to the sustainable development prospects of countries, increased economic sustainability of nations and institutional reforms that come with it provide the necessary basis for improved governance in the public and private sector.

Alternatively, corporate governance failures can undermine development efforts by misallocating much needed capital and resources and developmental fall backs can reinforce weak governance in the private sector and undermine job and wealth creation.” Globalization of finance and trade has supported the widespread adherence to common underlying corporate governance principles. They are not always country-specific and have been applied in various and diverse emerging markets, adjusted for local regulations and business traditions.

Building a strong board of directors never seems to get easier. High-profile board failures, the boom in activist investing, and the disruptive forces of technology are only a few of the reasons effective board governance is becoming more important.

Start with oversight, a role of the board that, most directors would agree, is no longer its sole function. Directors are now required to engage more deeply on strategy, digital, M&A, risk, talent, IT, and even marketing. Factor in complexities relating to board composition, culture, and time spent not to mention social, ethical, and environmental responsibilities and the degree of difficulty is set to continue to rise.

Mark and I stipulated a few points to help CEO’s and board chairs, as well as executives and directors, build stronger boards, this guide synthesizes multiple areas to make quick sense of complex issues in corporate governance, while focusing on the areas that are essential for building a better board and ultimately a better company.

Corporate Management Development
Corporate management has changed over time as managers have acquired better tools for understanding the problems they face. Most corporate managers are able to quantify many of the issues they consider, in order to make the correct decision. Managers factor in costs, benefits and the uncertainty of projects they are considering.
A good corporate manager is someone who can perform sustainable functions within the company they work for, while either maximizing revenue or minimising cost, depending on the department. Since the principles of corporate management are so broad, there are often specific disciplines for different parts of a company. The way a sales team is managed differs from the way the accounting department is managed.

History of Corporate Governance
Corporate governance is a newer subject of study. In the past, many companies were run solely for the benefit of their managers or founders. A company might have outside shareholders, business partners and thousands of employees, but under older ideas of corporate governance, the company would pursue only the goals of their managers. Managers might choose to provide poor benefits for employees, knowing that these employees couldn’t find better opportunities. Managers might also pay themselves excessive salaries without paying attention to community standards with respect to such practices.

Rise of Corporate Governance
In recent years, many companies have become more conscious of the need for good corporate governance. As regulations have tightened, it has become more difficult for companies to exploit workers or harm the environment. In addition, changes in financial markets have made it harder for companies to harm their shareholders. A mismanaged company becomes vulnerable to being purchased by another firm, so managers tend to treat their shareholders better. An increased focus on sustainability as a business practice, not just an ethical position, has also affected corporate governance.

Measuring Corporate Management Success
Corporate management’s success can generally be measured in terms of numbers. If the department in question is meant to create a profit (for example, if the entity being measured is a retail store or a factory), a quantity like profit margin or return on investment can demonstrate that it is achieving its goals. For departments that don’t have such responsibility (like a shipping department, or an accounting group), many managers measure their results in terms of cost. If a department can accomplish the same functions and spend less money, then by this measure, it’s a success.

Integrating Corporate Management and Governance
In recent years, many management thinkers have tried to synthesize corporate management and corporate governance into a single discipline. Since corporate governance is meant to equitably distribute the results of good corporate management, they fit together naturally: the best situation for a company to be in is for it to have good governance and good management. Combining these can take a variety of forms, from giving workers representation in company management to pursuing more efficient manufacturing processes in order to cut costs and help the environment. The most effective companies combine these practices in a mutually reinforcing way.

Finally, we discussed one more topic that is very typical that is trust – trust is generally lacking when board members begin to develop back channels to line managers within the company. This can occur because the CEO hasn’t provided sufficient, timely information, but it can also happen because board members are excessively political and are pursuing agendas they don’t necessarily want the CEO to know about. If a board is healthy, the CEO provides sufficient information on time and trusts the board not to meddle in day-to-day operations. He or she also gives board members free access to people who can answer their questions, obviating the need for back channels.

Another common point of breakdown occurs when political factions develop on the board. Sometimes this happens because the CEO sees the board as an obstacle to be managed and encourages factions to develop, then plays them against one another. We used the example of Pan Am founder Juan Trippe who was famous for doing this. As early as 1939, the board forced him out of the CEO role, but he found ways to sufficiently terrorize the senior managers at the company and one group of board members that he was returned to office. When he was fired again following huge cost overruns on the Boeing 747 the company underwrote, he coerced the directors into naming a successor who was terminally ill.

Most CEOs aren’t as manipulative as Trippe, and in fact, they’re often frustrated by divisive, seemingly intractable cliques that develop on boards. Failing to neutralize such factions can be fatal. Several members of Jim Robinson’s American Express board were willing to provide the advice, support, and linkage he needed — but the board was also riddled with complex political agendas. Eventually the visionary CEO was pushed out during a business downturn by a former chairman who wanted to reclaim the throne and a former top executive of another company who many felt simply missed the limelight.

The CEO, the chairman, and other board members can take steps to create a climate of respect, trust, and candor. First and most important, CEOs can build trust by distributing reports on time and sharing difficult information openly. In addition, they can break down factions by splitting up political allies when assigning members to activities such as site visits, external meetings, and research projects. It’s also useful to poll individual board members occasionally: an anonymous survey can uncover whether factions are forming or if members are uncomfortable with an autocratic CEO or chairman. Other revelations may include board members’ distrust of outside auditors, internal company reports, or management’s competence. These polls can be administered by outside consultants, the lead director, or professional staff from the company.

The Rt Hon David Blunkett, Home Secretary, London made a great statement once, when he said;

“Business continuity and planning is just as important for small companies as it is for large corporations. Plans need to be simple but effective, comprehensive but tailored to the needs of the organisation. Employers have a responsibility to their staff for their safety and security, and we all share the desire to ensure that any disaster or incident – whether natural or otherwise – has a minimal effect on the economic well-being of the country.”

The Values of Human 2 Human Spirit and Tea!

Recently I wrote a blog called “Let’s have some tea and continue to talk about happy things!” this blog stimulated much discussion with my business partner, Mark Herbert, in the US and then I informed Mark I had purchased a Chinese tea set to practice the tea ritual.

Mark’s view on tea was fascinating, he said ‘many friends, including the present company, know a lot about western afternoon tea etiquette, yet, few of them are acquainted with China and Eastern culture.

As is well-known, China is a country with a time-honored civilization and a land of ceremony and decorum. In China, tea is always served when guests come to visit. As an important medium of etiquette, tea plays a significant role in Chinese interpersonal relationships. Knowing the tea etiquette, being polite and showing respect when drinking tea in Chinese tea house can not only reflect your good self-cultivation, but also bring you the pleasantness and peacefulness from tea.

Nowadays, few people know the seating etiquette in traditional Chinese teahouse. Conventionally, the host’s left hand side should be the first guest of honour, the importance of the seats are in descending order from the host’s left hand to the right. It is the iron law to follow regardless of the table shapes. Besides, the old and teachers are most revered to take the first ranked seat, among them ladies have the priority when age differences are small. In addition, it would be inappropriate to sit opposite to the host. If it is inevitable, children should be allowed to take this seat.

It is the first time that the guests express appreciation to the host when they’re invited to taste the first steep, it is one of the most important etiquette in traditional tea ceremony. The formal and standard gesture is to stand up, men hold fists(left over right), women put palms together, make a bow, sit down, and take over the tea cups, smell the tea’s aroma first, then take a sip and savor the tea.

Finger Kowtow, otherwise known as finger tapping, is a ritual performed as a silent gratitude to the person serving the tea. According to legend, Emperor Qianlong of Qing Dynasty used to travel incognito to the south and once he went into a teahouse with his companions. The tea house owner used a long pot and poured the water three ups and downs with rhythm to make a cup of tea without even spilling a drop. Emperor Qianlong was impressed yet didn’t understand, “What was that movement?”, he asked. The owner smiled and said: “ This is the tradition of our tea house called ‘ Three Nods of the Phoenix’”. Heard that, Emperor Qianlong took over the long pot and tried to do the same, but that cup was his servant’s, normally the servant would get down on knees and kowtow to the emperor for this great honor.
However, to do so would reveal the identity of the emperor, so the quick-thinking servant bent his two fingers and tapped on the table as if he was kneeing and kowtowing to the emperor. From then on, finger kowtow has been the practice. Nowadays, instead of the implication of kowtow, people just tap their two fingers on the table to pay silent thanks to the tea server.

The tea ceremony may seem complicated after seeing that so many tools are required and sometimes some optional ones are also used. The traditional tea ceremony isn’t at all complicated and the steps to complete it are actually logical and simple. A nicely organized tea ceremony has a duration of 20 to 25 minutes. The traditional Chinese tea ceremony features the following steps.

1. The first stage of the ceremony is completed after warming the teapot and heating the cups. To easily achieve this, the performer of the ceremony needs to heat the water in a kettle and then place the teapot in the hot water together with the cups. After a few minutes the tea pot and the cups must be removed from the warm water.

2. The second stage of the tea ceremony includes appreciating the tea. During this step, the tea is passed around for participants to examine and admire its appearance, aroma and quality.

3. The third stage of the tea ceremony includes the actual preparing of the tea. The amount of tea and water will vary depending on the type of tea, its quality, and the size of the teapot but generally one teaspoon of tea leaves for every three quarters of a cup of water will suffice.

4. The next step includes placing the teapot into the bowl, raising the kettle at shoulder height and pouring the water into the teapot until it overflows. After pouring the water,the performer scoops away bubbles and tea leaves and put the lid on the teapot.

5. What the performer does next is to pour all the tea into the tea pitcher and fill the tea snifters. Then, he or she begins placing the tea cups upside down on top of the snifter cups, a ritual act said to bring prosperity and happiness. After which the performer grabs the cups and flips them so the snifter is inverted into the tea cup while removing the snifter to release the tea into the tea cups. The tea isn’t drank, but poured into the bowl.

6. The following step is the actual steeping of the tea which can vary depending on the tea leaves, their quality and the size of the tea leaves. Usually for the oolong tea which in general is used for this kind of ceremony the steeping time starts from 30 seconds up to maximum of 10 minutes. After the tea steeps, the host pours the beverage from the teapot into the tea pitcher. Using the tea pitcher, the tea is poured into snifters and then transferred to the tea cups.

7. The final step is the actual tea drinking. Good etiquette dictates that tea drinkers cradle the cup with both hands and enjoy the tea’s aroma before taking a sip. The cup should be drunk in three sips. The first sip needs to be a small sip, the second sip is the largest, main sip, and the third sip is meant to enjoy the aftertaste and empty the cup. After everyone has finished the first round of tea, an unlimited number of subsequent rounds of tea can be made. The best part is that oolong tea leaves can be reused up to five times in a row.

Gongfu Cha (tea skills). The proper way to serve tea, demonstrated with oolong tea.

Apart from practicing this fascinating ritual at home, the whole process triggered and stimulated many subjects around why we do not spend more time with loved ones, family and friends in gratitude. I am not suggesting that we all purchase a Chinese tea set, but it certainly embraces; honour, respect, laughter, gratitude and love for time well spent in the right company.

People of all ages are trying to learn and understand the etiquette of social media, as a fast growing platform in our society there is no one there to tell everyone the right way to behave. New things go viral every day, and the trending lists on the various social media platforms perpetuate them. Some of these things are promoting positive change, while others are attacking people or companies around the world. The big question is how is our ability to empathize is effected by social media. While I believe that social media can do amazing things in fighting a common cause or connecting us with people around the world, I believe that it can also cause a lapse in empathy.

Individual values reflect how you show up in your life and your specific needs-the principles you live by and what you consider important for your self-interest. Individual values include: enthusiasm, creativity, humility and personal fulfilment.

Our values are important because they help us to grow and develop. They help us to create the future we want and to experience true life.

Every individual and every organisation is involved in making hundreds of decisions every day. The decisions we make are a reflection of our values and beliefs, and they are always directed towards a specific purpose. That purpose is the satisfaction of our individual or collective (organisational) needs.

Relationship values:
reflect how you relate to other people in your life, be they friends, family or colleagues in your organisation. Relationship values include: openness, trust, generosity and caring.

Organisational values:
reflect how your organisation shows up and operates in the world. Organisational values include: financial growth, teamwork, productivity and strategic alliances.

Societal values:
reflect how you or your organisation relates to society. Societal values include: future generations, environmental awareness, ecology and sustainability.

Like organisations and the innovations they produce, the workforce has undergone significant change over the last 15 years. It shows every sign of continuing to evolve at this accelerated pace. Emerging developments are shifting stakeholder expectations, leaving industry leaders struggling to steer their organizations. Power is shifting from traditional executive positions to the workforce and customers with a proliferation of new ways to gather and disseminate information and collaborate on strategic tasks. As that shift happens, the gap between operations, workforce desires, customer expectations, and governing policies is widening.

Translating what makes environments like WeWork or relationships like Veterati so innovative in the prosumer-based model are they provide opportunities for organic and cross-functional work to occur. As we look at organizations of the future and how each member of this ecosystem will function together, leaders need to first understand the demands and then figure out how to meet their workforce where they are. That might mean rethinking how to use existing tools and channels to harness the full capacity of their resources. Humans are the most fundamental of those resources. As opportunities for daily H2H engagement decrease, the value of these interactions goes up.

Consider new mentorship models that can be harnessed for broader scale application and are not dependent on physical presence. Think outside of the traditional profile of a member of the workforce. AI and other machine-learning capabilities show promise for helping to equip managers with new mechanisms for efficiencies and more time to engage their workforce when the opportunity arises.

The capacity for success in a massively shifting work environment may be as simple as making sure that your human workforce feels personally connected to the group. Even as you pull down the walls around your operations, spend the time to listen and communicate shared purpose.

Bernard Beckett once said:

“Human spirit is the ability to face the uncertainty of the future with curiosity and optimism. It is the belief that problems can be solved, differences resolved. It is a type of confidence. And it is fragile. It can be blackened by fear and superstition.”

If you can tweet you can become president…

I was recently having a fascinating discussion with a CEO of a technology company around leadership, the weaknesses and social media as the communication link to their image, when the recently elected president of the United States of America came to mind.
It’s bizarre really, but the facts are: Donald Trump is the first Twitter president of the United States of America.

In an interview with Tucker Carlson of Fox News recently, Trump put into words what many people have long been suspecting, that were it not for his mastery of hyperbole in 140 characters, he would not now be occupying the most powerful office on Earth. “Let me tell you about Twitter,” the president began. “I think that maybe I wouldn’t be here if it wasn’t for Twitter.”
Combine together his followers on Twitter and Facebook, Instagram, @Potus and “lots of other things”, Trump said, and he has the combined ability to publish directly to as many as 100 million people.

All jokes aside, whilst the truth maybe the fact that Twitter, Facebook, Instragram @Potus and other platforms may attract his following of interested fans, the question you need to ask yourself is exactly what cost is his presidency costing the United States just as you could question a CEO of a FTSE 100 company that used Social Media to obtain his or her position in the same?

My company is often being approached by executive boards of companies that question their existing leadership decisions in people, it is clear that people love the title of CEO, but do they have or are able to execute the skills to the business that will make the change necessary to drive the company to profitability and growth?

If we take a look at some basic facts:
• We are in the worst economic circumstances we have faced in almost 100 years
• It is forecasted to get worse before we hit bottom
• There are many organizations who have already executed large scale reductions in force and they will be followed by others
• Layoffs, reductions in force, or whatever you want to call them cause anxiety, trauma and lost productivity

Here are some of the facts about poor leadership costing a loss in productivity to American businesses that I found out in an article published at Harvard Business Review

According to one of the workplace reports by Gallup, 50% of the working professionals in US merely put their time in at office, 20% often represent their discontent via missings their days on job, driving customers away or influencing the co-workers in a negative way. Only the remaining 30% are committed towards their work. What’s the reason behind it? ‘poor leadership’.

In fact, while researching for their book ‘Leading People’, the authors Rosen and Brown came up with the findings that the current state of poor leadership is costing more than half of their human potential to the American companies.

The numbers are self-explanatory as to how much does poor leadership cost a business in terms of productivity.

Loss of human resources
Loss of human resources does not only mean the employees leaving the organisation. Well, that’s the ultimate loss, but a big loss is when the employees are not being used as per their full potential.

Poor resource management is one of the key tell tales of weak leadership, that can bring a downfall for the company. No matter how experienced and expert your resources are, if they are not utilised rightfully they are not going to benefit the business. This will ultimately lead to loss of resources, more so it will bring the loss of your company.

Successful leadership is all about having the right people, with the right abilities, in the right place, at the right time!

Loss of revenues
According to the same report by Gallup that was mentioned in the second point it has been found that poor leadership alone costs American companies a loss of more than half a trillion dollar each year.

According to the Cost of Poor Leadership Calculator created by DDI, a leading firm that conducts corporate researches, it was found out that one poor leader costs leadership around $126,000 over just one year owing to loss of productivity, and employee turnover issues.

Corporations are victims of the great training robbery. American companies spend enormous amounts of money on employee training and education $160 billion in the United States and close to $356 billion globally in 2015 alone, but they are not getting a good return on their investment. For the most part, the learning doesn’t lead to better organisational performance, because people soon revert to their old ways of doing things.

In another survey The Conference Board CEO Challenge®, more than 1,000 respondents indicated that human capital remains their top challenge, with customer relationships rising in importance in the past two years. Also, operational excellence and innovation remain vitally important for driving business growth and ensuring a sustainable future. These challenges, albeit in varying order, were the top challenges in all four regions included in the survey: the United States, Latin America, Europe, and Asia.

When asked about the strategies to address the human capital challenge, 4 of the top 10 strategies CEOs selected are focused on leadership: improve leadership development programs, enhance the effectiveness of senior management teams, improve the effectiveness of frontline supervisors and managers, and improve succession planning. CEOs know their organisations cannot retain highly engaged, high-performing employees without effective leaders who can manage, coach, develop, and inspire their multigenerational, globally dispersed, and tech-savvy teams.

CEOs also were asked to identify the leadership attributes and behaviors most critical to success as a leader. The top five prominent in every region globally were:
• Retaining and developing talent.
• Managing complexity.
• Leading change.
• Leading with integrity.
• Having an entrepreneurial mind-set.

So how can leadership improve?
First, leadership capability efforts are not necessarily hardwired to business strategy. This will always lead to initiatives that are disconnected and inconsistent across the organisation, diluting the overall focus on the core leadership behaviors to cultural and business change.

Without properly aligning current leadership capability against business goals, you miss the opportunity to identify key gaps, running the risk of focusing on the wrong things.

Second, almost all of the focus is on quality of content; how well we execute takes a back seat. This becomes even more difficult when you are trying to scale efforts across the enterprise or across different countries and cultures. According to the Corporate Leadership Council, one-third of a leadership program’s success is related to content and two-thirds are determined by the quality of the implementation.

Finally, despite the best of intentions, many efforts produce no lasting change in terms of behavior and results. Don’t be drawn in by the hype of five-minute videos and digitized options. This type of learning can be engaging, but like a quick-fix diet, they don’t work.
Failure to examine the big data and analytics to help understand (and react to) the gap between existing leadership practices and proven value to the business is a detriment to leadership development efforts. Too often we are still content with the smile sheets and anecdotal data. To be effective, we all need data-driven analyses to execute informed decision-making processes and in real time.

This video on Leadership in the 21st Century and Global Forces by Dominic Barton, Global Managing Partner of McKinsey & Company, will give you another prospective to global and growing trends in ‘Global Leadership’ – The Darden Leadership Speaker Series kicks-off its 2016-17 season with Dominic Barton.

Talking with my business partner in the US, Mark Herbert, we created a check list of priorities that should be considered when making change, which include:
• Leadership development has long been viewed as a cost. It is an investment in your leaders and your business.
• The program is not adopted across the enterprise. If you do not predict and act on issues across geographies and cultures, there will be no consistency and implementation will not succeed.
• Development is seen as an isolated training event or the “initiative of the month.” That’s ineffective if you’re trying to achieve lasting behavior and change. Reinforce learning and sustain the momentum by investing energy and resources to diagnose your leaders and guide them through a targeted journey of experiences.

Marcus Buckingham, author of ‘First Break All the Rules’ and other management “bibles” stated:

“Today’s most respected and successful leaders are able to transform fear of the unknown into clear visions of whom to serve, core strengths to leverage and actions to take. They enable us to pierce the veil of complexity and identify the single best vantage point from which to examine our complex roles. Only then can we take clear, decisive action.”

Launching “Meaningful Conversations” with a book signing at Waterstones, Presentation and Party

My second book, “Meaningful Conversations” was finally launched on 28th January 2017 at Waterstones, and it has been an incredible journey. One that I am so proud of and I sincerely hope you will enjoy reading it.

I would like to thank Mark and Jackie, Sylvia and Liam, and Lisa my wonderful friends who allowed me to dream and who never stopped believing in this book. Without their love, support and constant belief, this book would not have been possible.

Below you will find some reviews and a gallery with snapshots from the launch.

In the sidebar on the right I put some links to selected booksellers – all other related posts you can find here: “My second book”. Also, check out my dedicated site: Meaningful Conversations Book.

REVIEWS

“Meaningful conversations is a brilliant follow up to Geoff’s first book Freedom After the Sharks. Although it is quite different Geoff’s passion and commitment are clearly present!”
Mark F Herbert, author of Managing Whole People

“Geoff has demonstrated his unique awareness and experience of how to succeed in business (or indeed any other human endeavour) by identifying 3 essential success factors. Simple as it sounds, it makes logical sense. Starting with the complexity of communication, he reminds us that without it nothing can move forward. His next step is all about the need for a clearly thought out strategy. Of.course, this is much more difficult to define and the appropriateness and effectiveness of the strategy will only be identified after implementation. The final leg is Growth and Planning. Providing there is good communication and a good strategy, then growth and planning will deliver the results. It is clear that Geoff is talking from a position of knowledge and experience and his thoughts and ideas make a lot of sense. All in all the book is packed with lots of useful nuggets and suggestions. A useful guide for any budding entrepreneur or indeed many CEOs.”
Amazon Customer

“Great book! Brilliant combination of practical guidance on key aspects of business development & growth as well as fresh look at some of the main challenges and opportunities facing businesses of our time. Strongly recommended for corporate managers and entrepreneurs.”
Amazon Customer

“Extraordinary insight into whole range of issues that face those in positions of responsibility. Completely accessible and invaluable guide.”
Simon Halstam

GALLERY

Bringing corporate culture and values to life

dna-strand1

Earlier in the year I was discussing the subject of corporate culture and the role of boards with my business partner in the US, Mark Herbert – this is a particular hot button for both of us and discussing cross border challenges and perspective’s can create great discussion.

I shared a culture program with Mark that was executed some 12 years ago and importantly the outcomes, Mark commented that this program was way ahead of its time even today, so I commented so what was the problem with adoption 12 years ago and what is the attributed cost to business today of company’s that still reject corporate or company culture?

Mark commented; ‘If values are to be more than just words on a poster they need to be translated into a set of expected behaviours that are meaningful to the company and those who work there.

Culture is much more about people than it is about rules. Codes of conduct are a baseline; a culture is created by what you do rather than what you say. The alignment and consistency of behaviours of leaders, and how they communicate through words and actions is the essential starting point.

Large organisations, particularly those with global reach, will have sub-cultures which can reflect different geographies, business units and remits. Nevertheless it is realistic to aspire to a common set of expected behaviours based on company purpose and values.
Human resources (HR) has an important role to play in embedding the values in the business. Where there is a separate ethics and/or compliance function the effectiveness is enhanced through close collaboration with HR. Aligning HR policies and processes with the values is a critical step in driving culture. There is a duty to invest in building HR and a people management strategy and capability which focuses on leadership and management culture, and embedding cultural values across all levels of the organisation. The board must work closely with the HR function to create the appropriate organisational culture through aligned strategic human resources management practices, from recruitment, induction, training initiatives, leadership development, performance management resourcing and succession.’

The challenge for boards is how to coordinate across the organisation and build a holistic approach to addressing culture. One large UK bank has recently tasked a number of its business divisions to work together to provide a single report of cultural indicators to the board. The individual functions each track many different data points in relation to behaviour and culture across the bank. Discussion at the board is focussed on a small number of the most meaningful measures that provide crucial insight and can be tracked over time. The chairman is confident this is a significant step in helping the board perform its role in seeking assurance on culture.
Those boards reporting that values, behaviours and culture were rarely discussed, explained that company culture is intrinsic and expected behaviours are understood by all and do not need to be articulated. This may be a result of a long established culture, a sense of complacency or a reluctance to address the subject because it is perceived as difficult to pin down.

Recent research shows that cultivating speak up and whistleblowing policies can lead to an increased level of trust within organisations. Trust is key in influencing the culture of a business. One way to increase trust is through the continuous development of visible policies to encourage transparency around possible bad practice.

This means developing collaborative policies that allow people to speak up, a well-organised set of procedures and an effective system of response to concerns that arise.

Also critical to success is the independence of channels through which whistleblowing information flows. Issues that can affect this include anonymity, the seriousness with which management treat those who speak up and legal issues.

When communication channels are developed effectively, evidence shows that speaking up becomes more engrained in the organisational culture. Measuring the effectiveness of a whistleblowing policy can also be useful to boards in assessing how effectively a culture is embedded.

A healthy ‘speak up’ culture breaks down the barriers than can often exist between the workforce and the board. External publication of the data can also give investors confidence that a genuine culture of openness exists and where it does not that the board knows about it. Demonstrating how the policy is working can also inspire employees to speak up in other ways and the culture becomes self-reinforcing.

core-values

Here are 4 basic tips for bringing your values to life:

1. Put values front and center.
It can be easy to lose sight of company values when focused on the task at hand. Values should guide all aspects of business, from the decisions we make to the talent we source to the way we interact with customers. Values cannot be applied if they are not embedded .

2. Hire based on values.
Building a workforce that lives and works by the company moral code starts with hiring based upon values. For each of the company’s values, develop a list of questions designed to assess a candidate’s character and potential fit.

3. Work (and play) by values.
The best way to bring organizational values to life is to model them. In other words, do not just let them sit on the wall and call it a day. Live, work and play by them on a daily basis.

4. Reward and promote values.
Last, but certainly not least, promote organisational values by rewarding behaviors that demonstrate them. Do not hesitate to publicly reward someone for exhibiting behaviors that are in line with the company’s character. Not only does this make the individual feel good, it also pushes the rest of the company to follow suit.

Finally, defining specific, behavioral examples helps clarify the intention of each value. For instance, a team value of “service excellence” can be interpreted in many ways: Is the customer always right? Do we provide excellent service at any cost? Do we serve external customers before internal customers? Are inquiries answered within an hour, a day, or a week?
If you really want your values to stick with your team, involve team members in the process of clarifying the values. People are committed to what they help create, so let them interpret the values and define behaviors (within your acceptable boundaries).

Facilitate this by asking these four questions:

1. What do our team values mean to you?
2. How do these values make you feel?
3. What specific behaviors do you think best demonstrate these values?
4. What could you do differently to better reflect these values in your work?

In answering these questions, your team will express specific behaviors that will bring your values to life!

As Laura Schlessinger once said:

“Values are principles and ideas that bring meaning to the seemingly mundane experience of life. A meaningful life that ultimately brings happiness and pride requires you to respond to temptations as well as challenges with honor, dignity, and courage.”

When we think Tech, do we need to think Speed to be effective?

tech

Is fast the only way in this sometimes cynical world of the one way or the high way. Every Millennial I interview tells me of his or her aspirations to create the next unicorn company and the only ‘skin in the game’ they have is £2,000 in the bank, ‘we do not need to be investor ready’, look here is my pitch deck, investors are guaranteed to back this deal, without crying in laughter or pain or both, I kindly close the meeting down for other meetings of the day.

There is a saying “Move fast and break things”; “done is better than perfect”; “code wins arguments”: such aphorisms litter the walls and pitch decks of start-ups and venture capitalists, and recently the Founder of Facebook, Mark Zuckerberg, seems to have completely changed his ‘Move Fast’ famous quote.

Carl Honor, the author of In the Praise of Slow and a huge inspiration of mine, states you can only squeeze so much productivity out of a human being. Eventually people burn out or lose interest, but working too hard and too fast takes a toll from the very start. Staffers become less creative and more error-prone. A long-hours work culture also leads to a lot of wasted time as employees hang around pretending to be busy when all they’re doing is putting in face time.

Study after study has shown that time pressure is only useful up to a certain point. Beyond that, it takes a toll. When people feel too rushed and are constantly working with one eye on the clock, they become less creative. Instead of coming up with bold, innovative ideas, they go for the low-hanging fruit. That is why forward-thinking companies are looking for ways to help their staff slow down. Some are giving employees more control over their schedules so they can work at their own pace, slowing down and speeding up when it suits them. Others are capping work hours. Even Wall Street banks have taken steps in this direction in recent months.

People often assume that, as a proponent of the Slow movement, I must be against new technology. They assume slowing down means throwing away the gadgets, yet nothing could be further from the truth. I am no Luddite: I love technology and own all the latest high-tech goodies. To me, being able to speak and write to anyone, anytime, anywhere is exhilarating. By freeing us from the constraints of time and space, mobile communication can help us seize the moment, which is the ultimate aim of Slow.
But there are limits. The truth is that communicating more does not always mean communicating better. You see parents staring at smartphones while spending “quality time” with their children. Surveys suggest that a fifth of us now interrupt sex to read an email or answer a call. Is that seizing the moment, or wasting it?

Whenever a new technology comes along, it takes time to work out how to get the most from it. Mobile communication is no exception: It’s neither good nor bad—what matters is how we use it. The challenge is to use communication technology more wisely. To switch on when it brings us together and enriches our lives, but to switch off when old-fashioned, face-to-face communication—or even just a little silence—is called for.

Human beings need moments of silence and solitude—to rest and recharge; to think deeply and creatively; to look inside and confront the big questions: Who am I? How do I fit into the world? What is the meaning of life? Being “always on” militates against all of that. You cannot daydream or reflect when your mind is constantly wondering if you have a new text message or if it’s time for a fresh tweet.

slowness (more on “the tortoise and the hare”: link)

The bottom line is that technology can help us slow down if we deploy it judiciously. That means using it to get things done efficiently and thereby save time—but then switching it off so we don’t waste that saved time by being constantly distracted. We also have to dedicate that saved time to Slow pursuits rather than simply cramming it with more work or consumption.

The world is changing: swaths of jobs are at risk of automation; consumers expect products to be available on demand, updated, personalised and yet also secure.

How many businesses can claim they have the technical skills, digital culture and leadership needed for the changes under way? The answer is: “Not enough”.

Recently I was in the US with my business partner, Mark Herbert, discussing some of the US’s business leaders, their creativity, skills and tech start-ups. Spending time in the US is always an opportunity to observe some of the knowledge and experience of the world’s biggest, most successful tech companies. UK business leaders across all sectors have always travelled to Silicon Valley or other US tech-hubs, seeking insights into what it takes to create a “unicorn”, a business launched after 2000 with a value of $1bn-plus. But the pace of change means the world has moved on by the time executives fly home with their intel.

A few years ago, the talk among big-business leaders was all about the recruits: they asked, “How do we get those bright tech minds out of start-ups and into our team — or just how do we stop them leaving us?” A few expensive hires later and some were left wondering why their business had not changed that much. Now their question is about organisational culture: “What is it that enables a tech culture to identify, create and ship products at the speed of light? And how do I plug that into my business?”

The issue of current and future talent shortages “plays to the strengths” of people and capitalising on them. That requires building supportive cultures, strengthening skills, creating important conversations and assigning development projects to enhance collective IQ and EQ – in my new book ‘Meaningful Conversations’ I have written extensively on the subject.

We are learning more about a new area of innovation and creativity within people: maximising cognitive functioning and the partnership of IQ and EQ. Given increasing overseas competition for talent and business results, the author (“The World is Flat”) and New York Times columnist, Thomas Friedman points out that in North America differentiation is through innovation and creative relationships and partnerships. He speaks of moving from a world of command and control to one of communication, consulting and collaboration.

As Amy Poehler once said:

“As you navigate through the rest of your life, be open to collaboration. Other people and other people’s ideas are often better than your own. Find a group of people who challenge and inspire you, spend a lot of time with them, and it will change your life.”

Guest blogger Mark Herbert discusses Building Relationships

handshake isolated on business background
This weeks blog is a guest blog:

I would like to introduce my business partner in the US, Mark Herbert (LinkedIn). Mark has over 30 years of combined corporate management and consulting experience in industries, ranging from high technology and financial services to healthcare and eco-tourism. His most recent corporate role was as Chief Operating/Relationship Officer for one of Oregon’s largest credit unions.

Mark is a Principal for New Paradigms LLC (www.newparadigmsllc.com), a management consultancy specializing in helping organisations effectively and successfully embrace change and engages their workforces.

Mark and I often discuss many subjects around leadership, trust and this week, Mark discusses building relationships.

I don’t know about you, but I have found that one of the longest journeys I have ever taken is that journey of introspection when I have faced significant milestones in my career and life and had to determine which path to take as I approached the crossroad.
As a child who was often ill I got the opportunity to spend a lot of time in my own company, much of it in hospitals and a good deal of the time away from pediatric wards. For much of my adolescence the effects of my health conditions followed me. I didn’t get the opportunity to enjoy some of the normal activities that kids do like little league, pee wee football, etc until much later. Even then I wasn’t terribly athletically gifted or inclined.
I did become very good at observing people. When you are a child late at night in a hospital you become part of the surrounding infrastructure. People carry on conversations and interactions as if you weren’t there. They aren’t being rude; they just kind of forget you are there.
I loved the Mary Stewart trilogy about Merlin and Arthur as child as well. I could especially relate to Merlin. As the bastard son of an unknown father Merlin became an observer. He was not destined to be a warrior like his cousins and though later it was determined that he had a legitimate claim on the throne he recognized that it was his destiny to advise kings rather than occupy the throne personally.
That is a persona that I have co-opted for myself. I advise kings and princes, but I have little interest in occupying the throne myself.

Mark Herbert - Paradigm LLC

The dark side of that observational ability is you see people hurt and flinch where others miss it.
This week I got to see that play out several times. I don’t manage to see it purely as an observer; unfortunately for me I feel their hurt as well.
In one case it played in my own family. We are an interesting group. To a large extent my father had an enormous gift of self confidence. He never seemed to doubt himself or his opinions. In an interesting paradox he was very sensitive to his own feelings, but almost oblivious to the feelings of others. He wasn’t intentionally cold or unkind, he just didn’t relate to being wounded by a word or action.
That kind of set the tone in my family. In many ways we are quite gifted. We have all enjoyed great success professionally. We also find ourselves enormously competitive and to an extent guarded. In my family you rarely if ever reveal your feelings, especially if you feel slighted or hurt – that reveals weakness.
My choice of profession and how I practice it still remains an enigma to my immediate family. To create space for myself, I moved away for several decades, so to my nieces and nephews I think I represent a bit of a stranger. My family is proud of my professional accomplishments; they just don’t entirely get me.
Even though I am kind of an outsider when one of them hurts the other, I feel it vicariously, as if I was the recipient.

In another situation I have a colleague who is a true philanthropist, not by profession, but by vocation. He works in an organization where his role as chief philanthropical officer is taking on increased importance to the sponsoring organization. He and I have spent the last many months trying to create a new philanthropic vision for the organization, defining philanthropy not as a transaction or simply a charitable contribution, but rather an investment in critical societal infrastructure.
It is a bold vision and creating a model where there is room for the grateful donor, the philanthropist, and the philanthropical investor is an interesting challenge.
As a gifted development professional he also lives in the world of relationships rather than transactions. This can be difficult when the sponsoring organization feels the tyranny of the urgent. They want dollars, cash dollars and optimally the sooner the better. Building the bridge between donor and recipient can be a time consuming process. Sometimes your initiatives don’t resonate with the donor base. Sometimes the focus of the donor doesn’t fit into the strategy of the organization. Trying to bring the parties together is not easy or simple.

In the third situation I have a dear friend who is on her own journey. She is a wife and a mother, but she also has goals and dreams about creating her own business that she has put on hold for a number of years. She is at the point now where she would like to be able to balance the investment of her passion and energy into her goals as well as her commitments.

Like in most relationships this changes the status quo. The other parties in our lives often don’t see anything as broken. They assume that those ideas and notions we had when we are young will just go away, especially if they were not the ones who had to subordinate their goals.

The common thread to me in all this is the importance and power of relationships.
I believe that the ability to build and sustain relationships is the key attribute that ultimately defines individual and organizational success and is the most important dimension of effective leadership.

As a former human resources professional and now a management consultant I speak and write on this topic frequently, maybe even obsessively.
This week I watched the stock market plunge because Congress and the President could forge a meaningful compromise without a deadline looming down on them.

Employee dissatisfaction with their jobs is at historical highs, and nine out of ten Americans in a recent survey expressed distrust for the senior management of the organization they work for – nine out of ten!

If you ask: does that matter, I would submit it does.

• Studies show that 40% of new or newly assigned managers and executives fail within the first 18 months of their assignment with the key reason not being ‘technical competency’, but rather the ‘inability to build effective relationships’.
• The Department of Labor estimates that employee turnover costs the U.S. economy close to $3 trillion annually.
• Presenteeism, the phenomenon where people show up to work, but fail to engage represents another $200 billion of leakage.
• U.S. organizations spend an estimated $100 billion on training annually. Studies indicate that the knowledge transfer after 24 months is less than 10%.
• Health care delivery costs us 12% of our GDP in 2010 with a substantial portion (approaching 20%) directly or indirectly related to depression, stress, substance abuse, accidents and injuries and other factors that deal with environmental factors like job dissatisfaction and anxiety about economic and emotional security.
• In 2010 the average compensation of the C suite went up 32% while the average compensation for regular workers went up 2%. Unemployment remains over 9%.

Outsourcing, lean systems, and trickle-down economics are not going to solve this problem.
There is no such thing as human capital: there are only people and relationships. Perhaps the sooner we recognize that and start our journey to build relationships based on mutual trust, respect and personal competency, the sooner we can arrive at a much better place….