Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

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Cheloha Consulting Group C O N F I D E N T I A L | www.ChelohaConsulting.com Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D. September 23, 2011 Plumbing, Heating, and Cooling Contractors Association (PHCC) Minneapolis, MN

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September 23, 2011. Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D. Plumbing, Heating, and Cooling Contractors Association (PHCC) Minneapolis, MN. Introduction & Background. Presentation Goals Introduction/Background I. Understanding Human Nature - PowerPoint PPT Presentation

Transcript of Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

Page 1: Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

Cheloha Consulting Group

C O N F I D E N T I A L | www.ChelohaConsulting.com

Leading & Managing your Business: Dealing with People

Randall S. Cheloha, Ph.D.

September 23, 2011

Plumbing, Heating, and Cooling Contractors Association (PHCC)

Minneapolis, MN

Page 2: Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

2© 2011 Cheloha Consulting Group. All rights reserved ,

Introduction & Background

Presentation Goals

Introduction/Background

I. Understanding Human Nature

II. Leading a Business

III. Managing People

IV. Managing Yourself

V. Succession Planning

Page 3: Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

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Introduction

My Goals: Share insights, learning, ‘truth’ accumulated over time in working in the trenches of organizations; not academic, not theoretical; but practical and applied

Education Session: Teach, share, answer questions

My hope for you: ‘Finding the Pony’

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Maps/Models to Plot your Course

The map is not the terrain

You need to know where you are and where you are going

Circumnavigate/Triangulate: What makes sense?

How manage/lead people. It’s very conceptual, abstract, and amorphous? The nature of CONSTRUCTS…– Human Nature– Leadership– Personality– Company Culture– Brain Function – Emotion

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Points to Remember

Human nature remains the same

Have a theory to understand people

Brain physiology: Reaction time of amygdala (50 milliseconds); via cortex (500 milliseconds)

Most reactions/perceptions/insights are hard-wired by age 5

We are all MASTERS of Projection

Nobody is perfect

Create a work environment where Progress on Meaningful Work can Occur

Chances are, as a boss, you get in the way

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Fast (1) & Slow (2) Brain Circuits: Our Reactions

AMGYDALA

HippocampusThalamus

Cerebral Cortex

The Event, The Trigger

Reaction

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I. Understanding Human Nature

Human nature remains the same over time (HBO: TheTudors, Rome)

Working Theory of Personality (and leadership style flows from personality)

Relationship of values, attitudes, and behavior

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A Framework for Human Behavior and Personality

Assessing Capability

1) Values (drivers)

2) Strengths

3) Weaknesses/Development Needs/Blind spots

4) Multiplier Effect: Work Ethic

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Making the Right Hiring Decisions

Draw on a Quality Feeder System: Local Schools, Tech Schools, Personal Network, Apprenticeships

Screening: Multiple Methods/Multiple People– Interviews -- Tests– Partner/Apprentice -- Probation (6 months)

Provide Immediate Feedback

Frequent Performance Reviews

Right hiring decisions saves 90-95% of management work

Productive people can be 200-300% more productive

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Mathematical Equation for Assessing Human Capability

((V + S – (DN))) * WE = CAPABILITY

Key:V-VALUESS-StrengthsDN-Development Needs/Weakness/BlindspotWE-Work Ethic

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VALUES: What do you want from Work?

1) Aesthetics (Quality control)

2) Affiliation

3) Altruistic

4) Commerce ($$)

5) Hedonism (Salesmen)

6) Power (B of A)

7) Recognition (Strokes)

8) Science (Engineer/Technician/Craftsman)

9) Security (Loyal, hierarchy-Utility)

10)Tradition (Loyal, hierarcy-Utility)

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STRENGTHS (What you bring to the party!)

Adjustment/Emotional Stability (the governor)

Ambition/Drive (work ethic)

Sociability

Interpersonal Sensitivity – Insight? Read people? Avoid confrontation?

Prudence/Judgment: – Mistakes lead to experience; the experience that accumulates

when we learn from our mistakes produces judgment

Inquisitive

Learning Approach

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Development Needs/Weaknesses/Blind-Spots (lo scores are STRENGTHS)

1) Excitable—ups and down in moods; emotional; expressive (lo=EQ)

2) Cautious--risk averse, avoid making decisions (lo=Decisive)

3) Skeptical—mistrustful, vindictive (lo=builds trust with others)

4) Reserved—introverted; poor communicator; insensitive to morale (lo=communicator)

5) Leisurely--passive/aggressive, mean (lo=responsive)

6) Bold-narcissistic feelings of entitlement (lo=modesty)

7) Mischievous-careless about commitment, loose ‘honesty’ (lo=integrity)

8) Colorful–reactive, manage by crises, center of attention (lo=good judgment)

9) Diligent—over controlling micro-manager (lo=delegate, empower)

10) Dutiful-eager to please boss, ‘brown nose’ (lo=provide support, independent)

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Mathematical Equation for Assessing Human Capability

((V + S – (DN))) * WE = CAPABILITY

Key:V-VALUESS-StrengthsDN-Development Needs/Weakness/BlindspotWE-Work Ethic

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Understanding Types

Types: Salesmen? Craftsman Plumber? Loyal/Dedicated employee?

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Salesman

Values– Hedonism, Commerce, Recognition

Strengths (time in the Marriott lobby)– Ambition– Sociability– Interpersonal Sensitivity

Development Needs (Quantity vs. Quality)– Bold– Mischievous– Colorful– Diligent (lo)

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Craftsman Plumber

Values-Aesthetics, Science, Security, Tradition

Strengths:– Emotional Stability– Prudence/Judgment (rigid, don’t listen, defensive; detailed)

Development Needs:– Skeptical (challenge authority)– Reserved– Diligent (hard working; too a fault)

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Loyal Employee/Does what you tell him to do!

Values: Affiliation, Altruism, Recognition, Security, Tradition

Strengths:– Emotional Stability?– Interpersonal Sensitivity– Prudence (it looks like it)

Development Needs:– Cautious– Leisurely/Passive-Aggressive– Dutiful

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Relationship of Behavior, Attitudes, Values

Iceberg Analogy

VALUES

Attitudes

Behavior: What’s Visible

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Entrepreneurs/Owners/Founders: What Makes You Special? (re. Economist Joseph Schumpeter)

The Rare Alchemy of the Driven Entrepreneur (WSJ, 8.26.11)

Characteristics:– Have the will to found a private kingdom, usually (although not

necessarily) a dynasty.- Henry Ford, Bill Gates, Warren Buffet, Steve Jobs, You- Example of business cards: Edison, Ford, Carnegie,…

– Will to conquer; the impulse to fight; to prove oneself superior to others; to succeed for the sake of succeeding (not for the fruits of $$)- An achiever and competitor

– Joy of creating; getting things done; exercising one’s own energy and ingenuity- Drive, perfectionist, over-control

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WHY Owners/Entrepreneurs may not be good BOSSES; their Personality Characteristics...(succession)

Independent

Determined & focused (stubborn, rigid)

Assume other people are the same (they’re not)

Over the top drive/strong work ethic

Willing to take a risk (most people aren’t!!)

Assume other’s can manage themselves (many require management)

Overly hands-on; need to know; detail; perfectionist

Over control (micro-manager)

Don’t need many ‘strokes’ or recognition

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IIa. Leading a Business (Job Description)

Boss, Numero Uno, El Jefe’: Represent the business (CCBW), Chief Cook & Bottle Washer)

Finance the business and pay the bills

Staff the business; hiring and firing

Satisfy customers and maintain high quality standards

Marketing/Business Development– print, fliers, mailings, networking, internet, ‘word of mouth’– Build your brand—What makes you Special?; Always ask

yourself: ‘where do I add value?’ (JED)

Make money!! (operate profitably)

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Maturing as a Leader: the Process

What’s my job/role? Maybe different than what you are best at, or what you want to do, or even what you think you should do…

Continual learning from experience/mistakes/pain

What’s my real job? (Slide IIb)

Do an Objective Analyses of your strengths and weaknesses

How do I fill the ‘gaps’? Delegation, new hires…– Current person being coached, the engineer—what if

promoted…

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IIb. Leading a Business: Your Real Job

Set Goals/Provide Direction (smaller vs. larger business)

Communicate (you are the only one who has this unique perspective)

Building Relationships (CORE) – Leadership by example is redundant– Setting the right tone for your company culture (the way we do

things around here)- Telling, Policy, and Rules- Showing/Modeling- Partnering-working together side by side (raising children;

Randy and trimming shrubs)

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IIb. Leading a Business: Your Real Job

Kaiser Permanente Health (SFO) study:

– About 24% of employees (study of 39,000) reported mild to severe depression

– Sick days and depression cost US $44 billion year

– Health insurance is cheaper if employees take less sick days and are less likely to visit their primary care physician

What Can you Do? Happier Workers are More Productive

– Gallup estimates cost of employee disengaement-$300 billion

– Study of 238 workers, 12,000 diary entries

– 33% of entries—unhappy, unmotivated, or both

Manager/Boss’s Job: How do you make ‘People happy’?

` - Remove obstacles; Provide Support; Provide Autonomy

– Create opportunity to ‘Make Progress Doing Meaningful Work’

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26© 2011 Cheloha Consulting Group. All rights reserved ,

III. Managing People

Providing Respect and Positive Affirmation (Golden Rule--treat your neighbor as yourself; give the benefit of the doubt; see the glass as ½ full; assume the best (Rosenthal effect)

Percent of ‘Bad Bosses’??? (Hogan)

Motivating Others – Motivation comes from the inside– But, The Boss Creates the Work Environment

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Making the Right Hiring Decisions

Quality Feeder System: Local High Schools, Local Tech Schools, Apprenticeships

Screening: Multiple Methods/Multiple People– Interviews -- Tests– Partner/Apprentice -- Probation (6 months)

Immediate Feedback

Frequent Performance Reviews

Right hiring decisions saves 90-95% of management work

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Performance Reviews: Providing Feedback and Coaching

Principles of Providing Good Feedback– The closer in time to the good or bad event, the better– Direct, focused, and tactful– Supervisors focus most on recent events (vs. Annual Review) – Review again during Annual Review; no surprises– Ratio of 10:1 positive to negative – Negative feedback engenders Defensiveness and emotional

“shutdown”- People don’t hear what you say after 1st negative comment,

so…- Keep it brief—make your point- Check for understanding then—and then again within next 5

days

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How Much can People Change?

NOT MUCH…Most hard-wiring in place by age 5; but we can learn/change and adapt

In talented motivated and bright people a LITTLE goes a long way

Frequently less ‘change’ and more re-directing their focus/energies

Sometimes it is increased Self-Awareness

Analogy: Taut wire guide on young willow tree

Where do Managers go wrong? Assuming things will get better if they do nothing (procrastination; avoiding conflict…)

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Formula for Employee Coaching & Change

Awarenessand

Acceptance50%

SkillBuilding

25%

Energy25%

1

23

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Realities of Coaching

Needs to be positive/trusting alignment between coach and coachee for coaching to work (interests aligned); that’s why boss/subordinate coaching is rarely effective.

‘Boundaries’

Most emotional memories are laid down by age 5 (Doyles); if there’s a threat, most people naturally react with emotion (amygdala)

Coaching: combine Challenge & Support

People can only change a little; but that little has a big impact on behavior (willow tree and guide wire)

Build off strengths; acknowledge and ‘fence off’ weaknesses– Counter-intuitively: people change most in the area of their

strengths

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When is it Time to Cut the Cord?

Most frequently expressed regret of managers/supervisors—I waited too long, I was optimistic that things would change, I thought it would work itself out…– To be fair, apply the three pronged Readiness/Capability test:

Knowledge—know what to do Skill—know how to do it Attitude—want to do it

Use an outside resource (another senior employee?)

Otherwise, you do yourself a favor by releasing the individual early so they can get on with their lives/career (People will thank you)

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IV. Managing Yourself

Most common BOSS/MANAGER blind spots– Not listening– Criticize not praise – Perfectionism – Over Control; Not Delegate

Managing your Emotions, Frustration, and Temper– The Brain, Functions, and Relationships

Taking Care of Yourself– Stress– Managing Stress (exercise vs. ‘oral’ satisfaction)– Depression, ‘the blues’

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Symptoms of Depression (National Institute of Health)

Persistent sad, anxious, or ‘empty’ mood

Feelings of hopelessness, pessimism

Feelings of guilt, worthlessness, helplessness

Loss of interest or pleasure in hobbies and activities that were once enjoyable

Decreased energy, fatigue, being ‘slowed down’

Difficulty concentrating, remembering, making decisions

Trouble sleeping, early morning awakening, oversleeping

Change in appetite or weight change (up or down)

Thoughts of death, suicide, ‘suicidal ideation’

Irritability, easily frustrated

Persistent physical symptoms, e.g., headaches, digestion, chronic pain

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Blind Spots; Most Common Areas for Coaching

Not Listening (can’t receive feedback about yourself; defensive)

Criticize not Praise (Boss finding person’s weak point)

Perfectionism (setting a good example; do the job right; partner/model)

Over Control/Lack of Delegation (Why?)– 1. An ego as big as all of Montana; Nobody can do it as well…– 2. Control needs; I like to be in control and on top of things– 3. Subordinates are weak; now---you have a selection/staffing

problem

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Managing your Emotions, Frustration, Temper

Amygdala—Seat of Emotion; Sensory Integration

Hippocampus, Thalamus—Emotional Go-Betweens; Way Stations

Frontal Cortex—Control/Inhibit Emotion

Fast/Slow Circuits in Reacting

Page 37: Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

37© 2011 Cheloha Consulting Group. All rights reserved ,

Fast (1) & Slow (2) Brain Circuits: Our Reactions

AMGYDALA

HippocampusThalamus

Cerebral Cortex

The Event, The Trigger

Reaction

Page 38: Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

38© 2011 Cheloha Consulting Group. All rights reserved ,

Model: Understanding Brain Structure, Brain Functions, and Behaviour

Evolution of the Brain (A. Koestler, 1967)

– ‘Automatic Pilot’ Brain (Rat)

– Emotional Brain (Smell)

– Executive Brain (Judgment)

Big Changes in Psychological and Psychiatric Understanding in Last 15 Years:

– Joseph LeDoux-New York Univ., ‘96

- Better Understanding of Brain Influence on Behavior

- Better Understanding of Neuro-transmitters and how they work

- Therapy: Best with both Relationships & Rx (scripts)

- Louis Cozolino (Neuroscience of Psychotherapy)

- David Siegel (Mindsight)

- John Arden (Rewire Your Brain)

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The Ghost in the Machine: The Evolution

AUTOMATIC PILOT BRAIN

Emotional Brain

EXECUTIVE BRAIN

Page 40: Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

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Fast (1) & Slow (2) Brain Circuits: Reaction to Stimuli

AMGYDALA

HippocampusThalamus

Cerebral Cortex

STIMULI

S2

S2

S2

S2S1

Reaction

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Functions of the Brain

Automatic Pilot Brain (Brain Stem)– Autonomic– Breathing– Circulation– Consciousness

Emotional Brain (Amygdala, Hippocampus, Cingulate Gyrus)– Emotion– Integration of Range of Brain Functions– Senses– Attention

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Functions of the Brain (Continued)

Executive Brain (Frontal Cortex); The Seat of Reason– Self-Control; Control– Inhibition of Impulses– Thinking; Complex Cognition– Judgment & Decision Making– Context/Subtleties

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The Ghost in the Machine: The Evolution

‘AUTOMATIC PILOT’ BRAIN

Emotional Brain•Senses: Light, Sound, Balance; Hearing; Touch

•Disruptive: Computer Screen; texts; Multi-Tasking

EXECUTIVE BRAIN•Evolves until 30’s

•Control/Inhibition/Focus

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Fast & Slow Brain Circuits (Reaction to Stimuli)

STIMULI

S2 S2

S2S1

Reaction 2 =Think, Consider, Context, Address Subtlety

AMGYDALA

HippocampusThalamus

Cerebral Cortex

S2

Reaction 1= Anger, Lose Temper, or ‘Meltdown’

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Bobby Knight (Retired and Ex-Coach, Indiana U., Texas Tech Basketball)

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Va. Succession Planning for the Next Generation

88% believe the same family or families will control business in 5 years

Familiar Family Businesses:– Ford Motor Co. --Interface (Atlanta)– McCormick Spice Co. --SC Johnson (Racine, WI)

Only 30% of family businesses survive into 2nd generation– Clifton’s (West Coast-Finance)– Acquisition (VIC)

Only 12% are viable into 3rd generation

Succession planning is a process (like a snowflake-each unique)

Do you have a plan? Do you have a process?

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Evolutionary Stages of Companies (Adizes, 1990)

Self-Employed

‘Family’—Succession can be an issue down the road; ‘letting go’

Professional manager

Mature/Bureaucratic (dying!)

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Vb. Succession Planning for Next Generation

The long runway is better than the short runway; start planning when in early (40’s, 50’s)

Succession planning is very, very easy to put off:– Concerns about our own mortality; you block it out– Brings out denied/covered-up family issues– My work defines me, what will I do if it’s gone? Impact on my

marriage?– Control needs; can I let go?

Will your successor be an immediate family member– Capabilities and Fit– Drive and Motivation

Sell to Outsider (How value?)

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49© 2011 Cheloha Consulting Group. All rights reserved ,

Summary: IMPLICATIONS FOR YOU AND YOUR BUSINESS

Understand People and Human Nature– Build Relationships (leadership by example is redundant)– Understand strengths and weaknesses of your employees (model)

Lead: Provide Direction; Communicate; Create a Positive Work Environment

Provide & Receive Feedback– Listen and be open– Don’t be defensive– Manage your emotions

Make Progress on Meaningful Work

Manage Yourself: Deal with your Emotions, Frustration, & Temper– Stress management– Depression– Over eating/drinking– Exercise to relieve stress and improve mood

Plan for succession

Page 50: Leading & Managing your Business: Dealing with People Randall S. Cheloha, Ph.D.

50©Cheloha Consulting Group, 2011

Cheloha Consulting Group

Wynnewood, PA

Randall S. Cheloha, Ph.D.

610-896-9494

610-755-7879 (mobile)

[email protected]