Jan Richards

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The best way to manage business risk: go toward it

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What’s the best way to manage business risk?

Go toward it.

Sounds risky, itself…walking toward the thing you fear?

It can be.

The alternative, however? Far worse.

Real business risks, ignored…well…it’s not pretty.

Remember, first, that not all risk is the cliff diving, high-flying, life-defying kind.

Circumstances that bring these types of extreme risk are, frankly, circumstances you can’t control anyway.

The national and world economy, for example is something you can’t do a lot about, individually.

Devastating acts of nature…same thing. You just have to be ready to adapt well to circumstances such as these, however things work out.

If these are the risks you worry most about, scenario analysis is a tool that could be helpful to you. I’ll tell you more about that in a post later this week.

Second, the real risks in business are often things you can do something about. 

And these risks are not far away. They’re often already inside your company.

They’re the risks that you either created (often unwittingly) or that you perpetuate by not addressing problems fully and directly.

Any of the following situations are a risk to your company. And these are all circumstances you can do something about:

– Lack of focus

– Inattention to important details (the details your customers care most about)

– Lack of clear and complete communication

– Inaction or ineffective action when a problem is discovered

– Confusing, inconsistent and ineffective ways of getting work done

– Ineffective and frustrating hiring, onboarding, training, managing and mentoring practices

The signs of potential risks and trouble can be subtle…or glaring.

And because you’re in the middle of the situation, you may not really see or grasp problems until they’ve been festering for a long time. You may have simply become used to them, and think that’s the way things are, and the way things will always be.

Start to remove risks inside your business in these ways:

1. Brainstorm

Start by considering the parts of your business that feel in control.

What gives you confidence that these things are working well?

Next, think about what feels out of control.

Which of these worry you the most, and why?

Be specific as you create both the “working well” and “worrisome” lists.

2. Pay attention

Don’t assume that all is as it seems.

What assumptions are you making that you need to check? (Often, you’re either very right, or very wrong in assumptions that you make).

What data and information do you have, or wish you had…and can get…to monitor and manage the things you’re most concerned about?

If risks prove to be real, the information you wish you had is information you’ll want to figure out how to gather and put to work.

3. Go toward the risk, and test to see if it’s real

Work to understand what’s really going on before you jump into action to prevent, mitigate or manage perceived risks.

Observe, research, inquire, test in whatever ways you can to start to see if the risks are real, or they’re worries that are unwarranted.

By the way, people may say, “Our work is different. We can’t possibly measure and manage what we do.”

I’m here to tell you, as a former operational analyst and process auditor at Apple and elsewhere, that there are ALWAYS things you can do to see how things are really working, compared to how you think they’re working, or how you wish they were.

The information you gain in this way is always clarifying. Usually, it helps make things work better for everyone involved. And that, when it happens, is good for employee morale, customer satisfaction, and, as a result, profits.

In addition, get to know people who can advise or teach you. They may quickly see potential problems that you’re blind to or are purposely avoiding. They can also help you figure out how best to address problems you might have missed.

5. Chunk the action

If changes are necessary, once you understand the risks that are present, break the change into a series of achievable actions.

You’re more likely to do the work if you “chunk” it into manageable projects and tasks.

Suddenly, big goals that were daunting or immobilizing become accessible and motivating as you make steady, observable, and felt progress, step by step.

How to simplify in the extreme

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Sometimes you’re thrown into a situation that makes a mess of your well-laid plans.

And sometimes you’re suddenly in a chaotic situation that’s one hundred times more complicated than that.

Just one current example? You know where this story is going…

It’s the COVID-19 pandemic experience we share.

In chaotic times what do you do to simplify the chaos?

And not just simplify, but simplify in the extreme?

Try one or more of these four steps:

1. Focus on one priority. 

Yes, just ONE.

When you’re trying to right a world that has turned upside down, you don’t need the drag and drama of trying to juggle multiple goals.

Like a laser beam, narrow your focus to a single point. Make that your sole priority for now.

2. Let go. Say no.

The only way you’re going to let go is to say no.

And if that’s not easy for you, well, frankly, that’s tough.

You need to be able to clear out the underbrush. You have to let go of what is extraneous for now.

What was once important may be again someday.

Now, it it not.

Practice the word, “No,” until you can say it with the calm confidence you need to back it up. And then live your fully-owned “no.”

3. Pay attention.

You need information that’s easy to gather and use in order to know if you’re getting back on track, and staying there.

Select a few key indicators you can count on.

Then pay attention to the information it is providing you.

Use it simply, consistently.

4. Follow up.

Take the time to see how things are working, and if they could work better.

And if things aren’t working, face the facts.

If you need to adjust your plans and actions, do it.

Your work and the world will right itself, with time, but in the meantime, it needs your help.

The best way to start?

Simplify, in the extreme.

 

Here’s another post you may be interested in:

How to lead successfully through uncertainty

Great communication is the lifeblood of great leadership

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Great leaders are great communicators.

Leaders’ effectiveness depends on their ability to inspire, engage, and activate many people to reach for and work for a shared vision, meet common goals, and create significant results together.

Being a great communicator is one of top ten characteristics of great leaders.

Powerful, effective leaders know when and how to communicate, no matter what’s going on with their teams or organizations.

Leaders may face many different emotions at different times in the teams that they lead (and, by the way, in themselves). Some people are excited and energetic, others feel fear, pressure, confusion, and at times, weariness or boredom on the long path to a major goal.

Great leaders know when to observe, when to listen, when to talk, when to show.

And they use all the vital communication skills of leadership effectively.

They also know that the most powerful communication of all is their attitude and their actions – far more than what they say in any circumstance.

Imagine any of the world’s great leaders and what might have been different, had they been an average communicator, at best.

For example, think of Franklin Roosevelt, Winston Churchill, Mahatma Gandhi, Martin Luther King or any of many other world leaders without their powerful oratorical and other communication skills.

Leaders face different communication needs and challenges, depending on the circumstances in which they’re leading their organizations. Here are a few of the main ones:

1. Normal, predictable cycles of operations

These circumstances involve vision-setting, planning, regular action, follow-up, problem-solving and process improvements.

During these times, great communication focuses a team or organization on goals, the path and processes to reach them, roles, consistent check-in points, the ways that progress is evaluated and ensured.

2. Major change or improvement efforts

These circumstances may involve reorganizations or mergers and acquisitions, very rapid growth, major improvements and other types of significant change.

During these times, great communication focuses on what is or will be different, how the change will be achieved, ways of evaluating and communicating progress, as well as how to sustain momentum as change proceeds.

It is essential that leadership communications and processes at these times keep people focused, energized, engaged and encouraged as they go through the often very difficult work of change.

3. High-stress or emergency communications

These include natural disasters, such as earthquakes or hurricanes, and man-made disasters, such as on 9/11/01 in the US, and during stressful times when US and world financial markets lurched wildly in 2008, and the recovery period afterwards.

During these times, great communication is focused on providing clear directions so people can try to meet their immediate and then longer-term health, safety, security and other needs.

In addition, there’s often a strong need for community in high stress times, with ways for people to share, express and process their often-frightening, yet memorable, shared experiences. (These are the conversations that begin with questions such as, “Where were you when you heard the news?” or “Where were you when it happened?”).

No matter what type of circumstance leaders and their organizations are in, most of the same stages of communication must be successfully addressed:

Focus

Earn and hold the attention of their audience.

Connect

Reach people in a personally significant way so that they can relate to what is being communicated, “enroll,” and take appropriate action.

Direct

Create a clear path for the many individual actions needed to achieve shared or individual goals.

Persist

Inspire people to draw on – and continue to draw on – persistence, if it is necessary to see a difficult effort through to completion.

Check/correct

Ensure that actions are moving along as needed in order to reach goals and significant milestones.

Achieve

Coordinate efforts and information so that people can reach goals, solve problems, and create success, hopefully, in the easiest, clearest, most effective way.

Celebrate/Complete

Acknowledge that major goals have been achieved, and create closure in a valued, positive way.

Leadership excellence: How to use clarity to cut confusion

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Clarity is one of the top characteristics of leaders who excel.

These are the leaders about whom inspiring stories are told for years, long after they’ve led their organizations through extreme circumstances or uncertainty, and met great challenges honorably.

Why is leadership clarity so important? It’s because people can’t follow what they don’t understand.

And because circumstances are constantly changing, ensuring clarity, as a leader, is a never-ending job.

Think of leadership clarity this way. Trying to follow a person who’s not clear about where he or she is leading a group is like trying to follow someone while driving in thick fog.

People on a team, in such a case, don’t know where the road is, or if there’s one at all. They don’t know where the dangers are, or how to handle them. They don’t know if, in that fog, they’re still traveling as a team, or eventually, on their own.

Teams immersed in uncertainty proceed nervously, slowly, trying to move as safely as they can. Or, metaphorically speaking, they may pull over to the side of the road, waiting for the fog to lift, the way to become clear, safety to be ensured.

In the meantime, time and opportunities are lost. Costs increase. Profits fall. Team cohesion falls apart.

Being clear, as a leader, may sound easy to achieve. It’s not.

It requires clear thinking in every circumstance – when the best way forward is apparent, as well as when the best path is not yet known and must be created, as you and the team move forward.

To reach this level of clarity, a leader and his or her team need good information, effective collaboration, clear and effective processes for prioritizing and decision-making. They also need a strong and accurate sense of who their customers are, and what those customers need and want.

Great leaders build strong organizations, which may include many people.

The work of everyone involved must be integrated and coordinated in some way. That may be done loosely, organically, or it may be accomplished in much more formal, structured ways.

The net effect, however it’s done, is that with the right direction, information, and other signposts along the way, individual employees can make the right decisions and choose the right actions in their daily flow of their work to create progress on shared company goals.

Combined with the other top characteristics of great leaders, leadership clarity turns good intentions, and precious limited resources into the best results possible for customers, and all company stakeholders.

Visioning: See and create the future together

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Visionary leadership is one of the top characteristics of great leaders.

Leaders who have this ability can see a better future for their teams and organizations. They’re very successful at engaging others in the process of creating that future together.

A shared, positive vision is far more powerful than many people would guess. In the absence of such a vision, individual members of a team – any team – are pulled toward their own visions of the future. Often these visions are poorly aligned. At worst, they directly conflict.

For example, some people are driven by great fear of the things they’re trying to avoid. They’re filled to the brim by graphic visions of the very things they dread. They may not realize how powerful these visions are, perhaps even leading them closer to the very things they wish to avoid. They need a compelling, positive vision to replace their fear.

Others, in their fervent desire to try to manage change, are motivated by visions of protecting the status quo, no matter what it costs. These visions can be helpful in the short-term, but in the long-term, they’re likely to freeze people, and organizations, in place – if that is even possible – as customers and competitors continue to move far ahead.

What happens if people in your company, or on your team, are drawn to, and working to implement, visions that conflict?

The result will be wasted effort, time, money and opportunities, as well as extreme distraction, and, in all likelihood, great conflict. 

It will be anything but a focus on customers, and the productive, shared effort that ensures that customers’ needs are well-met. Ultimately, of course, dissatisfied customers take their business to competitors, or decide to quit buying products and services like yours altogether.

Great leaders can gather and direct the full range of their team’s resources – time, talent, attention, energy, and budget – to create a strong and positive future for their companies, customers and team.

Seven ways to delegate well

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I’ll explain this photo in a moment.

Before I do, consider this common burden for many managers:

“What’s the hardest thing for me, at work? Delegation, definitely!”

Does that sound familiar?

I’ve heard this same frustration from entrepreneurs and managers at many companies during my career as a business consultant. It came up again at lunch with a couple of friends this past week.

How about you? Do you need to improve your ability – and comfort – with delegation, too?

Start with these ideas:

1. Be clear about the goal

Often, when you ask people what their goal is for a particular piece of work, or a project, they’re not exactly sure.

What they usually know with great certainty, however, is what they DON’T want.

You’ll improve the quality of work you delegate when you provide clear goals to the person who’s doing the work.

Make sure you know, too, whether you plan to delegate this work temporarily or permanently.

This may affect how you hand off the task.

For example, if you’re delegating the work permanently, you may need to do more training and followup than if you’re delegating the work for a one-time project.

2. Be selective about who you delegate the work to 

The friend who was frustrated by recent attempts to delegate, even though she’s very experienced with delegation, believes she’s been trying to give them work that they don’t have the right skills to do.

She’s leading a team hired by a prior manager for jobs that have since changed.

“I give up! I’ve tried EVERYTHING!” she said as she described the situation.

Her team’s customers now require financial advice on business decisions they’re trying to make, in addition to the solid accounting support the team has always provided.

My friend has been trying to train and coach her employees to fill the expanded roles.

Coaching simply hasn’t worked.

If she were hiring now, she would screen for the skills her team currently needs, and skills they’re likely to need as their customers’ needs continue to change.

3. Set measures that focus attention and action

Decide how you’ll monitor the quality of the work you’re delegating. Then be ready to communicate those measures, and how you’ll use them, to the people doing the work.

In a simple, low-risk example of why this is important, our daughter, now a young adult, was about ten when she was helping organize the many colors of paper I needed for gift notepads I was creating for clients.

Anne normally works very carefully, and takes pride in doing very high quality work. I understood that she wanted to do the (frankly) boring task while she watched a TV show she liked.

When I checked the quality of her work soon after she started, I was surprised. Somehow, she was accidentally creasing some of the paper.

Before I corrected her approach, I asked myself if I’d given her the right instructions, resources, time and space to do the job right?

I had.

The one thing I had not done, I realized, was to let her know the quality standards for the work.

My customers, used to high quality work, would expect the same quality in gifts I gave them. That meant the paper…and soon, the notepads…needed to be crisp, the paper unbent, the work of gift quality.

And that meant that Anne needed to work more attentively.

She wasn’t happy, of course, that I needed her to start again, and to do the work more attentively. But we’d caught it early, and that was good.

Once she knew the quality standards and paid more attention, her work improved, as did her speed.

And, yes, it all worked with TV.

4. Communicate clearly

Communicating clearly is easy to advise, but can be deceptively hard to do.

Provide the following information, at a minimum, to the people doing the work for you:

  • Goals for the work (deadline, budget, and any other constraints)
  • Customers for the work
  • What successful completion of the work looks like to these customers
  • How you’ll monitor and assess the quality of the work
  • Instructions for doing the work, as necessary
  • Where people can get more information, if needed, while they work

Clarity and focus upfront helps prevent wasted time and rework – incorrect work that has to be done again – and hard feelings about it later.

5. Train as needed

If the person, or people, who will be doing the work have prior experience with it, they may need little training or supervision from you.

If they’re inexperienced, however, they may need detailed instructions, as well as regular feedback and coaching as they learn to do the work well, and build confidence with it.

And this leads me to the story about the photo I included with this post.

The photographer in this case was our son, Matt (who does photography and film work as part of his job and career). Now a young adult, he was about about four when he took this picture.

I’m the person who’s stretching and trying to reach Matt…and the camera. I was laughing as I tried to catch him, but also nervous that he might fall off the wall where he was running, snapping pictures as he ran.

(Anne and my husband, Gary, watch in the background with amusement and curiosity as they wait to see how this interaction will play out).

The picture makes me laugh now when I recall the moment.

Matt didn’t fall. He didn’t drop the camera. He got this amusing shot.

And in fact, letting him use my camera in the future…with training, and AFTER asking permission to do so…and then encouraging him to learn more through experiments and projects with a camera we bought for him when he was ready for it, turned out to be a good move.

It was a gradual process of delegated and self-directed learning and growth. We encouraged both our kids to learn by doing, and through experimentation and projects, in their own areas of interest.

It can be a very successful way to delegate work, as well.

Learning by doing, and through self-directed experiments, can be very successful, if the work you’re delegating is compatible with that approach.

6. Keep your team focused on your customers’ needs

In case there’s uncertainty or a debate about the quality standards for work you’ve delegated, use your customers’ requirements to find the answer.

In the example of my friend’s frustration with recent delegation attempts, her employees are proficient with what their customers used to need: timely and accurate accounting.

Their customers’ business requires more of them now, so the quality standards for their work continue to change, too.

7. Check in, follow up

Make time to check in periodically to see how the work you’ve delegated is going.

Be prepared to check in more frequently than you expect will be necessary, at least initially.

You may find that the people to whom you’ve delegated work have questions you did not expect.

Or there may be skills, knowledge, or confidence that they do not have yet, and which you need to help them grow.

That’s enough delegation advice for now.

These seven ideas give you plenty to work with if you’re trying to improve your delegation skills and confidence.

Practice, pay attention to what you’re learning, continue to improve.

You’ll find that delegation, once mastered, is an invaluable skill.

Try this quick “Ten A’s” exercise for focus, energy, action, results

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On a whim one recent Monday morning, I brainstormed a list of words to inspire and challenge myself as I tried to get the day and week off to a great start.

It was an accolade and aggravation-filled list, as you’ll see, below. It helped me prioritize and refine my plans…and amused me, too…all in the space of about 3 minutes.

See if this brief exercise works for you, too. If the words I chose don’t work for you, replace them your own.

Here are a few guidelines to make this exercise work best:

– Keep the list short.

It’s a rapid-cycle brainstorming exercise to get yourself warmed up for the day or week.

– Use words that you react to, either positively or negatively.

Success is made up of the ability to respond well to positive and negative situations. You’ll be better prepared or more adaptable if you consider both types of circumstances, right from the start.

– Fill out the list quickly.

You may be surprised at what you learn in this rapid-cycle check-in with yourself. That surprising information may be the spark of energy, or the note of caution that makes all the difference in how you focus and invest your day or week, and the results you produce.

These were the words and questions that I used. Use these, or create your own list, if you like the idea of this exercise, but know that other words and questions will work better for you:

1. Admiration

What can I do to earn my own admiration today? This week?

2. Aspiration

What do I aspire to do, be, or achieve today? This week?

3. Accomplishments

Do I have any accomplishments that I’ve overlooked, or taken for granted so far?

4. Accolades

Are there accolades I should be giving myself for great work done recently…even if the work is not yet complete? What’s an appropriate way to recognize or celebrate them?

5. Action

Are the actions I planned for today still the right actions for moving ahead, given what’s most important right now? What are the 1-3 most important things I must get done, if nothing else?

6. Angst

Are there things I’m worrying about? What can I do to make the situation better?

7. Acceptance

Are there things I need to accept but which I have not actively accepted yet? (Acceptance is a far more active state than many people think of it as being. It’s far from passively giving up).

8. Admonitions

Are there warnings I need to pay attention to, or information I need to get? Are there assumptions I’ve made, but had better double-check?

9. Aggravations

Are there problems that I need to clear away in some way, such as through a process improvement? Is there a task that I need to delegate?

10. Avoidance

Are there things I’m avoiding that I really need to attend to? Is there important information that I’m trying to ignore?

What do you do about a goal you forgot…or have been resisting?

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Are you finding, as you build momentum in this new year, that there is a goal you “forgot”?

It can happen.

It may be a goal that:

– You hoped you could, and others would, forget about.

– Was something you never wanted to do, but knew you needed to.

– Was buried, day by day, as more immediate issues got in the way.

If there’s a goal like this for you as we move farther into 2022:

1. Decide if this forgotten goal is something you still want to achieve.

Sometimes there’s a goal we hope to get to, but it’s big enough that we just don’t grasp quite how to begin to tackle it, much less know how to completely meet it.

At other times, the forgotten goal may be one you once had, but have now outgrown or, for other reasons, no longer hold.

2. If this is a goal you still want, get excited about it again.

Maybe there are great benefits to getting this work done which you haven’t focused on fully yet.

Take some time to imagine you’ve achieved the goal. Experience that feeling of victory in its full glory…all the sights, sounds, and elation.

Also imagine the process of getting there. See yourself rising above each challenge that may crop up along the path.

3. Accept it if this is something you have to achieve, whether you want to or not.

This may be a “should” or “must” that you still have to carry forward.

If so, accept it (easy to say, but hard to do…I know that from experience). And get moving.

There is a lot of power in acceptance. The energy you’ve spent running away can be used in far better ways. You may, and probably will, find that you’ve met your goal far more quickly than you expected, once you’ve buckled down and gotten the work done.

Suddenly, the goal will be met, and the burden will have been lifted, as well.

4. Increase your dissatisfaction with the status quo.

This is the opposite of getting excited about a goal you still want to achieve.

To get to the point of action, sometimes we have to wait until we’re really ready to let go of the past. And, well, sometimes that takes a lot of unhappiness with the status quo. We have to be far more ready to go than to stay in the situation we currently find ourselves in.

How can you increase your dissatisfaction with your current situation, making you less willing to tolerate the status quo?

5. Take your big goal and turn it into a series of smaller, more accessible and achievable goals.

Put those smaller goals on your calendar and work to achieve each of those, one by one.

You’ll create a steady stream of achievements, which has far more benefits than you might realize now.