SparkPilot blog

Budgeting………… over the years, I have seen budgeting become this massive effort instead of it being the simple step of applying financial quantification to an annual execution plan.  So let’s go and look at the various opportunities for simplifying the process.

Opportunity I

Please do not merge the annual planning with budgeting process.  People, they are separate efforts.  Annual planning should be done after the strategic multi-year planning process.  Then the annual plan should be used as input to the budgeting exercise where the financial constraints are applied to the annual goals.  The trade-offs are then made based on the strategic goals.

When the financial planning is merged with the annual planning, people tend to become overwhelmed and/or decisions tend to be boil down to cost management instead of annual execution of the strategic plan.

And, let’s face it, the accountants already control too much of our life already.  Please don’t allow them to dictate how we do our jobs.

Opportunity II

This is one that I have seen happen more times than I can count and is a pet peeve of the budgeting effort.  When creating the budget, it is good practice to use the expenditure numbers from the previous years.  You do have that data don’t you?  So let’s look at this scenario.

We outsourced some work to a company and when we started, they only need to provide us with 10 folks.  If we assume that they charged us $20 per head per month, it would be a total cost $200 per month.  Then after five months we doubled the headcount to 20 folks, we would now be paying them a total of $400 per month.

So for the visual folks, here is what our expenditure looks like.

OK, so this is exactly like we thought it would be, a step up as we spent the money.  The numbers are in the table below, totally up to $1,000.

Now assuming that we would want to continue the service, how much should we budget for?

Well the simple answer is, that spent $1000 this year and therefore the budget should be the same because we have a flat budget.  Then there are other that are asking about the duration of the project etc.  So here are some more assumptions that for the purpose of this scenario, I will define but as management, you really should be making these bets.

• We will continue with the contract because they are delivering.
• There will be growth; you need to decide how you want to forecast it…….
• Assume no attrition

Of all of these questions, the biggest challenge will be how aggressive do we want to be be on the growth and how do we want to allocate it.  For the purpose of this example, I am going with 100% growth allocated across the four quarters.  This means that we will grow 25% of this years allocation every quarter.  Now the graph looks like this.

Again, no big surprises because it simply shows the continued expenditure and also the 25% growth every quarter.  Please note that they add up to $3,900 and therefore this will need to be the budget for the following year.  If you are being held to a flat budget, then you will need to prioritize and decide where to cut, this contract or elsewhere.

Opportunity III

Doing the budgeting exercise without supplier or partner involvement.  In this scenario, the person doing the budget takes a guess, or maybe looks at a couple of websites to get an idea of the possible costs.  In many cases this is done because the person doing the budget does not know what the actual annual plan is and the idea is to get enough $ before embarking on the project.

Some other reasons why the budget can increase:

• Off shore exchange rate
• Up-leveling of the skills of the out sourced staff
• Increased scope
• increased coverage
• Increased rates

In my experience, I have yet to have a supplier or partner account manager push back when I tell them I am working on budgets and need to understand what to budget for the following year.  Naturally I give them a month or two notice so that they can get things sorted out on their side.  This is especially key when dealing with off shore facilities because of the exchange rate fluctuations.

I was raised in South Africa and as such I got to experience the apartheid era.  I saw firsthand what affect discrimination and censorship had on the population and as a result I support the concept that everyone has the right to make their own decisions, even if those decisions will have a negative impact on themselves.  Censorship is one of the first freedoms removed when a dictator comes into power, is that where the USA is going??  Let’s not just hope, but also take a stance and influence.  Here are some words of wisdom from Edmund Burke

All that is required for evil to prevail is for good men to do nothing.

This blog contains original content and therefore theoretically be supporting the fight against piracy and copyright infringement; which I do!  However imbedded in this law is the requirement for ISP’s to inspect traffic and block what they deem to be content that is infringing.  I’m sorry but I do not believe that they are qualified to make that decision and therefore I am speaking up.

Google is fighting this and you can sign their petition here

Here are some news and articles with more information so that you can make your own decision on this topic:

BBC – http://www.bbc.co.uk/news/technology-16612628

CNET – http://news.cnet.com/8301-31921_3-57329001-281/how-sopa-would-affect-you-faq/

CNN Money – http://money.cnn.com/2012/01/17/technology/sopa_explained/index.htm

A while back, I was asking a friend for guidance and she said something a not being a mind reader and therefore I needed to speak my mind.  We laughed, stayed on topic and I communicated clearer so that she was able to understand me.  I started thinking about this and noticed that when I don’t know what to do or have a difficult problem to solve, I get quiet and think.  This generally takes time……….and while I am processing away, what message are others around me receiving?  Or in the instance of when we are tying to communicate something, we assume that people are getting the message that we intended.

I brought this up at our cohort meetings and we have discussed this in detail.  We all agreed that for clear communication to happen, you need the following address the following areas:

Someone must talk

Despite the many technology aids that we have, face-to-face verbal communication still remains the most effective method of communication and therefore someone needs to talk.

The reason behind the face-to-face communication and not TXT’ing, email, telephone is that these communication mechanism are all single mechanisms.  Face-to-face is the only mechanism that provides us with the ability to get at least three communication mechanisms.  The key ones are verbal, non verbal such as eye contact, expressions and gestures, and environmental situation (noisy room).

However, if it is not possible for face-to-face dialogue, then it is far better to use a single faceted communication mechanism such as TXT’ing, phone, and / or email.

Someone must listen

Not listening is biggest challenge with communication because we are so focused on getting our message across that we miss what the other person is trying to communicate to us.  If you catch yourself formulating your response to what the person is saying, then you are not listening to them.  Make sure that you understand what they are attempting to communicate, so ask clarifying questions.  Depending on culture, paraphrasing what you understood them to say back to them.

The most important element of listening is to shut up!

Timing

Is the person ready to receive the message that you are attempting to communicate?  This is a big one that is often overlooked.  If you are not sure, just ask them.  If you upset someone and even if you are ready and willing to apologize, are they ready for the message?

Is doing nothing the default option?

For those that are disagreeing with me right now and think that doing nothing is the acceptable default option.  (Pacific Northwest and the Passive Aggressive Communication style)  I would ask you to think about the following:

• What message is being received when you do not communicate one?  Are there others that are communicating on your behalf?  If so, are they communicating your message or theirs?  In my experience, they will communicate a message that is beneficial to them and not to you.  Only you can communicate the nuances of your message.
• If you do not know what you want to communicate, it is OK to acknowledge that and communicate that.  Acknowledging and communicating your perspective will form the basis on which you communicate on.

Every time you are tempted to react in the same old way, ask if you want to be a prisoner of the past or a pioneer of the future

– Deepak Chopra –

“Whether you think you can, or you think you can’t–you’re right.”

-Henry Ford-

In a previous post titled: Simple Approach / Plan for Change, I brought up Awareness as the first phase for change.  This has been the stimulant for a number of conversations about what Awareness and requests for more clarity on the topic.
I have been having lot’s of conversations with managers about how to get people to modify their behavior. Behavior modification starts with making the person aware of the impact of their behaviors. The awareness state is the first step of a journey that enables us to change the situation or address the issue.  Getting someone to the aware state can be a rather daunting hurdle, mainly because our egos get in the way. Awareness is just having the knowledge about the current situation or state of affairs. So let’s look at the process that we all go through to become aware.

Event

Moving from an unaware state to an aware state is a journey that requires an event or trigger to kick start the transition process of moving from an unaware state to an aware state. For self-aware folks, you are able to generate this event without help from the outside. However for most of us normal folks, we require some outside help to generate the the event. Think of the event as your alarm clock going off in the morning. We might not particularly enjoy it going off but it can definitely help us from being late and is therefore very beneficial to us. Managers:  We might need to be the ones that create the event that kick starts this process.

Denial

In this phase we tend to ignore or deny the incoming data / perspective because the situation does not match our preconceived idea or notion of how we want it to be.   This phase can be traumatic and depending on the implications or if the situation it may have an emotional on us.  This phase is the most impactful all around because the personal that is doing the denying can feel that they are being picked on.  The people that are trying to help can easily just stop trying to help because they are getting told that there is not an issue.  People just get tired of trying to help and walk away.

Recognizing this phase:

• Our perspective is different from other peoples.
• Unwillingness to discuss the situation with others.
• Denial will manifest itself as emotional spikes or silence.  The more passive the personality, the more the silence.

With practice this phase can be shortened but unfortunately not bypassed so make peace with it.  It is OK to wish and / or wonder why this is happening to us.  The circumstances of the event and associated emotional impact with have an impact of the duration of this phase. Managers:  Give people time to process the event and the implications.

Manager’s Note:

• Work with your people and take them through the trauma.  In certain situations, they might need to get external help, so work with your HR representative and be aware of the manpower laws.
• Do not mistakenly categorize silence as denial because analytical personalities take time to process the data and they tend to process in silence.

Risks:

• Getting stuck in this phase means that we are disconnected from reality and often leads to argumentative behavior.
• People that just deny will find that people will stop trying to help them.

Redirect

Redirecting the attention elsewhere is an attempt not to involve ourselves.  This phase is where people find the reasons and attempt to rationalize things why not to accept this information that is different to our perspective or desired state.

Recognizing this phase:

• Redirecting the attention or blame onto others.
• I can’t do anything about this situation / issue.
• Raising points about similar behaviors / issues with others thereby justifying their perspective.

Manager’s Note:

• Do not allow people to play the victim or to rationalize the situation as not theirs issue.  Accountability starts here.
• Equality for all – do not treat people differently because it is divisive to the team morale.
• Stay focused on the individuals situation and do not fall into the trap of discussing this issue as a relative issue.

Risks:

• This is the victim state because it is a lot easier to redirect the attention form us.

Acknowledge

Yeah I know I talk too much We all start off in an unaware state where we do not have the knowledge in our minds. If we are lucky enough we manage to make it to an aware state where we have the knowledge and are then able to define our action plan based on the knowledge we have gained. Let’s look at the process of how we move from the unaware state to an aware state so that we can remove the luck portion and manage the situation better. People that are self-aware have the ability to generate the Event with little to no outside help.

Recognizing this phase:

• Run out of excuses is the most common.
• You have adopted or modified your perspective to include the points raised.
• Able to list the points where your perspectives were different or the similarities.

Manager’s Note:

Acknowledgement is last step of awareness but for managers it is important to help our people use this new awareness to modify their behavior appropriately.  Help them and coach them through to the desired state.

Risks:

• It is important to differentiate between acknowledgement and a plan to address the issue discovered through the new found awareness.
• When dealing areas of improvement, it is important not overwhelm the person and also to help with a plan to address these issues.  Without the help, they will quickly become demoralized.

Last week, a friend shared this article titled:  Caring for Your Introvert and I though that I would share some of the highlights from my perspective:

• Introverts brains work differently, seriously, there is scientific research on this.
• Introverts find dealing with people tiring.  It is not that they cannot do it, or do not like people.  They just need to recharge their own energy levels afterwards.  Unlike most extroverts, they are not energized by social interaction with people.
• While a lot is known about extroverts, very little is known about introverts.
• Please accept them for who they are.

Many a true word is spoken is in jest and I had to laugh when I saw this post showing the Org Charts of some of the large hi-tech companies.

The Org Charts Of All The Major Tech Companies (Humor)

A while back, I lost a good friend and last week, I realized that some of my behavior must have been so irritating for him.  For those that do not know me, I am a results orientated person, often referred to a Type A.  My friend, let’s call him Curly, had his healthy streak of Type A but he was a Collaborator at his core.  He was at his happiest when he got to work with others creating something, especially to improve the life of others.

Me, I tend towards having frank and direct discussions, which for the most part works, because when I misstep, I am able to notice and recover the situation.  The fact that I only became aware of this behavior this weekend, is totally embarrassing to me.  Hopefully this post will help others learn through my mistakes.

So, the behavior

I tend to make statements or suggestions that certain very collaborative personalities, such as Curly, can easily construe as instructions.  OK, in some cases, they were instructions.  Well intended but instructions never the less.  Intent does not equal impact. While he never said anything about my behavior, I remember one occasion, it was obvious that I had made him angry but then, being the great collaborative person that he was, he smoothed over the situation, cracked a joke and we moved on.

We never revisited the event and I remained blissfully ignorant………..until this weekend when someone else educated me.

Now I wonder, how many other people had this same reaction to my “instructions”….if you did?

How to drive change in a predictable and reproducible manner has been a topic of discussion with three of my mentees.  Why predictable and reproducible?  The answer is simple, when you shock people, they tend to stop and evaluate what is going on before moving forward.  So if our behavior is predictable, then we will not shock them.  As leaders, we are expected to reproduce results consistently and being able to do it once, just makes us lucky.

Experience has taught me that I can greatly increase the chances of success by reducing the number of variables or unknowns.  As a result, I use a pragmatic approach with as little process as possible and keep things simple, thereby making things easy to explain and easy to understand.  For more mature or process heavy personalities or organizations, this approach might not be acceptable.

This approach works as long as the plan takes into consideration the unique situational requirements and evaluates progress / results on a regular basis.   This means that you only need to change where needed and not reinvent the wheel every time.

So, to the plan.  There are four key areas of the plan.  The first is Awareness followed by a Planning phase before the Execution phase.  A much forgotten phase is Monitoring or measuring the progress, or destruction.  Here is a visual representation which hopefully makes things clearer.

Awareness

In this phase we need to become aware of the problem or issue.  If is it is a behavioral issue, someone might provide us with feedback.  If it is a business opportunity, this might be a customer or prospect sharing with us their business challenge.

Recognizing this phase:

• Becoming aware of a situation that we were previously unaware of.  The Ah Ha moment.
• Finding out that there are different perspectives to the one that we have.  Most often we personalize this and say that person has a different opinion.

Manager’s Note:

• If you need to provide someone with behavioral feedback, it is important to focus on the behavior and not your judgement.
• This phase can be traumatic, be patient with your people and help them through it.

Risks:

• Often we tend to ignore or deny the incoming data / perspective because the situation does not match our preconceived idea or notion of how we want it to be.  Ignorance is bliss, or is it?
• This phase can be traumatic and depending on the implications or if the situation it may have an emotional on us.

Plan

If we don’t know where we are going, how are we going to get there?  In some cases we also need to take a look at where we are and then determine the gap between where we are and where we want to go before we start down the road.  I am not advocating analysis paralysis but at lest know what you are going to do.  A very important element of this phase is what are measurements are we going to use to determine if our execution phase is working or not.  The monitoring phase will help you determine if the plan is working or not.

Recognizing this phase:

• Deciding what to do and what not to do.
• Providing clarity around where we are going or what we need to do.
• When people ask what needs to be done.

Manager’s Note:

• clarity, clarity, clarity
• Sometimes you need to place a bet and make a move rather standing still and looking around.
• Continue to gather feedback.
• Being in a management position, does not always give you the right to dictate the plan.
• Ensure that the plan is being communicated in a manner that people understand it.
• It is OK for the plan to be different to how you would do it.  Diversity is great!!

Risks:

• Not doing anything because waiting for the data. (analysis paralysis)
• Omitting this step.  If you don’t plan, the execution phase will be delayed while people work out what they need to do.
• Not using data to define the path forward.  Be careful about perceptions because they depend on the person and the filters that person uses.
• Bad or no communication does not make it a bad plan.  In some cases, the plan may lay out the lesser of two evils and therefore it will be unpopular.

Execution

This phase is all about delivering the results as defined by in the plan.  If you, or the people executing the plan, are not clear about what needs to be done, go back to planning.

Recognizing this phase:

• There is work that needs to be done.
• The plan is defined and now needs to be executed.

Manager’s Note:

• Do not get in the way of the execution.
• Being critical of the execution.

Risks:

• Losing focus
• The execution elements where not simplified or fragmented enough to be executed because they are still too large or complicated.

Monitor

This often overlooked phase is key because it provides us with the safety net for the planning and execution phases by monitoring  how the execution phase is really addressing the need.

Recognizing this phase:

• The execution is in full swing.
• People are providing feedback on the progress, or lack thereof.
• Not knowing if are making progress or not, it’s time to monitor.

Manager’s Note:

• Monitoring is not a step that people like.  In most cases, they do not like to be measured.
• Feedback is a form of measurement, it is just subjective.

Risks:

• In most cases, we are not very good monitoring ourselves.
• Skipping this step means that you never know how you are progressing.
• Not having milestones or metrics means that progress is subjective.
• Not having a baseline before you started executing means that you do not know if your are having a positive or negative impact.

P A T I E N C E

• P=Positivity
• A=Attitude
• T=Tenderness
• I=Intuition
• E=Example
• N=No Negativity
• C=Caring
• E=Everlasting hugs

Thanks for sharing this Jolene.

“Our lives begin to end the day we become silent about things that matter.”

-Martin Luther King Jr.-

Leadership becomes necessary to business and communities when have tough challenges to tackle, when they have to change theirs ways in order to thrive or survive, when continuing to operate according to current structures, procedures and processes no longer will suffice.

-Ronald Heifetz-

What’s the point of talking to anyone if you don’t tell ‘em what you think?

- Jon Krakauer -

Earlier this week I downloaded a paper titled “Eight Signs of Incompetent Managers”.  The link to register and download the paper is at the bottom of the post.

Based on research that Profiles International conducted to identify America’s most productive companies, they identified the following Eight Signs of an Incompetent Manager

It takes all the running you can do, to keep in the same place.
If you want to get somewhere else, you must run at least twice as fast as that.

- Lewis Carroll -

I was in my early twenties and starting to take this thing called work a little more seriously.  I was learning from real world experiences, both my own and those of my colleagues.  I was fortunate enough to be mentored by one of my more experienced and senior colleagues, who we shall call Mo.  Over about a year, Mo became more and more dissatisfied with his role in the company.  I was confused to why he was dissatisfied, after all he was where I was working to get to.   Then a mere 18 months later, I found myself in a similar situation where I was dissatisfied with my role.  I followed Mo’s lead and left the company and took a position that was more stimulating at another company.

Over the years, I have seen this behavior repeat itself, both to myself and to others.  In the illustration above I have created a graph to depict the trend  of our job satisfaction over time.  In the illustration I used growth or satisfaction on the y axis.  For those people earlier in their careers they are more focused on their growth applies.  For those that are in a matured role, job satisfaction is a more appropriate label for the y axis.

The good news for us is that there is some research that shows that this curve is normal behavior in a book titled “The Doom Loop System” by Dory Hollander.   The time it takes for this curve to manifest itself is influenced by a number of circumstances both personal and job related.  As we go through the job satisfaction curve, our emotion play a role where we like and dislike the various stages as shown in the diagram below.

So far we have focused on our perspective.  In the diagram below, let’s take a look at things from an outsiders perspective, more specifically at our performance through the curve.  Not surprisingly, our performance tends to be better at the top of the curve where we have the knowledge to perform.  The interesting piece is that our performance declines on the tail end of the curve too.

The Doom Loop System is the brainchild of Dory Hollander and the first chapter of the book covers the Doom Loop System.  The rest of the book provides insight on how to continue career growth using the information gained from the use of the Doom Loop System.

The Doom Loop System builds on the curve and everything else that we have covered and that you are now familiar with.  The Doom Loop System follows our progression along the crve with the start in Quadrant I in the bottom left of the graphic below.  Then onto Quadrant II in the top left, Quadrant III in the top right and then down to Quadrant IV at the end of the curve.

The Doom Loop System

Each of the quadrants are covered below together with some keywords that can be used to describe our attitudes in each of the Quadrants.

Quadrant I

Quadrant I is generally the beginning of the curve where we are excited about the opportunities. That being said, we are still working on learning the environment or even building the skills needed for optimal performance.

Quadrant II

In Quadrant II we have the skills, know the environment and therefore are able to perform at a higher level.  As a result, we tend to feel more upbeat and this is reflected by our attitude too.  As such, we are both happier and have the highest level of performance at the peak of the curve and therefore this is the ideal quadrant for us.

Quadrant III

In Quadrant III we have peaked and are now on the downhill portion of the curve.  As a result, not only are starting to enjoy things less and our performance is also starting to deteriorate.

Quadrant IV

Quadrant IV is the least pleasant place to be, both for us and for our employers.

How does this apply to me?

So can we use our feelings and attitude to provide us with some insight into how the Doom Loop applies to us.  You can complete a Doom Loop Survey survey here that uses response about your feelings and attitudes to plot out a Doom Loop Matrix for you.   The URL for the survey is:  http://sparkpilot.com/doomloop/

Interpreting the Results

The resulting matrix has been plotted out according to the responses to the survey.  The numbers in the quadrants reflect the allocation of the survey results that are applicable to that quadrant.  The matrix reflects your perspective and does not reflect the perspectives of others or reflect your capabilities and skills.

Overcoming this behavior

The book covers in a lot of detail on how we can manage this in our careers.  The book introduces the concept of capstoning, where we need toe evaluate which quadrant we are in and when we are at the peak, we then move onto another role that stretches us further.

As managers, we can create the environment to help our people stretch and grow. The key is for us to know when our folks are transitioning from Quadrant II to Quadrant III.  We then create some new opportunities for them, while they are at their peak, either in new roles or expanding their current roles to include new challenging and exciting elements that will move elements of their role back to Quadrant I.  This is beneficial not only for the company but also for the employees because they do not have to go through the stress of finding a new role in or outside the company.  This approach also eliminates the integration phase because the person is still working with people that they have already established relationships which they can leverage.

A great reminder that we all have to fail…….before succeeding.

No one can make you feel inferior without your consent.

- Eleanor Roosevelt -

I read this post on overcoming negative thinking shortly after I posted my glass half full post where he shares some guidance on how to fill up the glass.

http://www.lifeoptimizer.org/2010/02/23/negative-thinking/