I came across the kind of commentary that so angers me. The post was about how to recognize leadership traits in children.

Of course, parents should encourage their children to grow, but this type of thing furthers the myth of what to look for in those who become ‘leaders’, while those without these traits are destined for a lesser role in life.

“…raise your child to be a winner, a leader and a success rather than another member of the dull rat race.”

The ‘leader’ to which the post and follow-up links refer is the person out front with the big pay package, as opposed to plain, hard-working solid citizens—I guess they’re the afore mentioned dull members.

Leadership isn’t a set of skills, it’s how you think and live.

And while it may be your pleasure to see your children excel, it’s your parental leadership responsibility to help them do it.

5 ways for parents to lead

1. Teach your children to love reading books. Books offer every person a world of hard knowledge and imagination stimulants.
2. Don’t make things easy for them, especially in school. A poor grade merits neither a rant at the kid or the teacher, rather it requires your effort to understand the difficulty—tough homework isn’t it—and assistance to find ways to improve.
3. Don’t fight your kids’ battles. People grow by overcoming difficulties, so be supportive and available to help, but don’t do it for them. Obviously, the exception is bullying, which should never be tolerated.
4. Set age/maturity appropriate boundaries within which decisions are up to them without interference or advice; this gives kids the luxury of making mistakes and learning from them.
5. Don’t live vicariously through your children. Their hopes, dreams, fears and worries should be of their own making, not foisted on them, whether actively or passively.

By the way, if you follow the links in the post I mentioned you’ll find it’s a sales pitch for a Christian leadership course.

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Click if you dare

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You decide—are you?

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Previously we discussed the challenge of mapping the environment as a non-linear optimization problem. The environment has peaks, valleys and plains as well as gentle even slopes. Changing a service feature has a non-linear effect, depending upon the topography of the environment at that point. The sensitivity of the environment to a particular service feature is variable.  It is impossible to predict, and can only be discovered by experiment and testing.

Focus Can Maximize Fitness, but Raises the Risk Profile

Evolution has developed an effective response to the problem of non-linear optimization—focus.

Most species focus very narrowly on a particular niche. This tight focus allows these species to limit their contact with the environment to the minimum number of features. As a result they can achieve an extremely good fit to this small feature set of the environment.

In a commercial environment businesses also do the same. The narrow focus of many businesses is amazing. Often I am surprised that a company can build a business with such a narrow service focus.

Reaping the Benefits of Better Focus

Remember back in the hardware store when we found the section with nuts, bolts, and screws, which illustrated the incredible diversity of evolution in business?

Just a few aisles over, in the paint section, we can find a similarly striking example of how evolution drives focus. Years ago, paint manufacturers produced the paint and mixed the colors at the plant. They had to guess what colors consumers wanted, and how much of each, but once the pigment is mixed into a can of paint, it cannot be removed. This proved very costly, since making paint is easier than forecasting consumer color preferences, especially as there are thousands of choices.

In a stroke of brilliance, one manufacturer dramatically simplified the forecasting problem by shifting the color mixing function to the point of purchase.

From a business point of view, this manufacturer intensified its focus on its distributors, thus allowing itself to reduce its points of contact with the consumer environment. The manufacturer had to learn how to transfer tools and technology for color production to each distributor, but it freed itself from the need to forecast the fickle preferences of consumers.

The evolutionary description of this process is similar. The paint manufacturer exploited its strength in color production to increase its competitive advantage; it deepened its relationship with a symbiotic partner; and reduced its contact with the consumer environment.

The result is an entire industry that can more easily survive rapid market changes.

Recognize the Risks of a Narrow Focus

In the short term a narrow focus is an excellent strategy. Most of the time the environment is stable and the business remains well suited to this stationary environment.

However, if the environment shifts just a little, the fitness of the business drops dramatically. Then the business species face a daunting challenge—adapt swiftly or face extinction.

Sounds like the situation today, doesn’t it?

Some small companies concentrate their sales within a few large customers. Many small companies have built good businesses selling primarily to IBM, or General Electric, or General Motors.

In the auto-parts business, suppliers have only a few companies in the total customer universe, probably less than twenty significant customers in North America and even in the world.

Unfortunately, the current market for auto-parts suppliers illustrates the other side of the equation—increased risk. If any one of the domestic auto manufacturers goes into bankruptcy, no doubt many auto parts suppliers will simply shut down—permanently.

Checkup: Maximize the Rewards of Focus

• How do you focus your business?
• Find three specific examples of recent decisions that increased your business focus.
• What critical choices are facing your business in 2009?
• How will you use these choices to increase your business focus?
• What low performing services can you drop?
• How can you deepen your relationships with your top customers and business partners?
• Are you reaping the benefits of focus – reduced expenses, increased profits, better stability?

Checkup: Minimize the Risk of Focus

• Where is your company overexposed –  largest customer, most important product, key employees?
• How can you manage those risks?
• What key indicators, or early warning signs, will alert you to troubles?
• How do you track those key indicators?
• How will you recover if a major customer suddenly disappears? Major supplier? Key employee?

In a post last spring, I listed Warren Bennis’ leadership skills and in 7 follow-up posts discussed why today’s managers find it hard to do their job without these skills.

But, in fact, everybody needs them in today’s world; they’re the skills that help you live a better life, raise kids and make a better world—no matter who you are or what you do.

Many of my posts touch on the same facts, but we’ll zero in on more how-to information in this series.

Bennis says that “leaders are originals, whereas managers are copies,” but what does that mean to an individual?

Foremost, it means that you think for yourself, instead of buying into an ideology, religion or what parents, friends, colleagues or the commuter who sits next to you every day say.

That doesn’t mean that you always do things differently or ignore everything you hear, but it does mean that you reserve your right to question, modify and partly or totally reject whatever it is.

This isn’t always obvious. Most adults honestly believe that they are originals, but they forget that their MAP (mindset, attitude, philosophy™) has been shaped since childhood by all those outside forces.

This is even truer of business and political leaders who are rarely original; rather they conform to a general pattern laid down by pundits, benchmarks, and expectations.

As an individual, your MAP is still your own. You can reject all or part of the external forces and, as it used to be said, ‘do your own thing’.

Being an original means that you choose what is best and what to do in each given situation; it means taking in all the wisdom, mundane advice and foolishness and synthesize them into the best decision that you’re capable of making.

As you’ve probably figured out, being an original isn’t the easy way to go. It’s far more comfortable to be a copy; to follow without question the ideology, religion, parents, friends—anyone or anything that takes away the fear of making the wrong choice.

I’ve always been an original, much to my family’s consternation when I was growing up, and to many of the bosses I’ve had since; I even adopted Frank Sinatra’s My Way as my personal theme.

I don’t really remember feeling scared as I careened through my early life doing what I thought was right, but I do know that I learned what my thought process was called when I was in my early twenties. From then on I did it consciously and it’s never let me down.

It’s that process that I want to share with you, because it works.

It’s called “worst case analysis.”

What you do is look at what you’re planning and think about the absolute worst thing that could happen if you do it. Then think through whether and how you would deal with that result. If you can handle it, then you go forward; if it’s too much you go back to the planning board. Works every time.

Do this, and at the end of your life you, too, will be able to say,

For what is a man, what has he got?
If not himself, then he has naught.
To say the things he truly feels;
And not the words of one who kneels.
The record shows I took the blows –
And did it my way!

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Dan McCarthy posted a the 7 Myths about Management—read them and think. As Dan points out you need to know yourself and I’ll add that you also need to know your MAP—not always the same thing. (We’ll talk more about the differences Thursday.)

Good stuff.

Now, in the spirit of solutions, I thought I’d give you something to print out and stick up on your wall. Do it, it will help you keep your eye on the correct ball.

Be sure to read this terrific article in Forbes shows you why reading Machiavelli’s The Prince is well worth your time as it is a great guide to handling the powerful people at work and other places who have the ability to make your life hell. Machiavelli spent four months at Cesare Borgia’s court and lived to tell the tale and offer up guidance to the rest of us.

“In popular culture, Machiavelli is synonymous with deceit and treachery. However, Machiavelli’s main concerns were the security of the state and the welfare of its people. Much of his leadership advice is plain common sense.”

For most of my years in business, my clients’ nickname for me has been Michiavelli and I always saw it as a great compliment.

In addition to common sense, one of the traits we have in common is unvarnished honesty. Phil Gerbyshak over at Slacker Manager once asked me how that bluntness affected managing and other interactions; it was no problem as long as I never lost site of four basic points.

Blunt honesty is not about being

• insulting, demeaning or contemptuous; or
• personal attacks.

It is about

• telling someone the truth as you see it and then listening and hearing their responses;
• the clearly understanding that they have full reciprocity when they do respond;
• never retaliating for their honesty.

For example,

When interviewing a company that isn’t doing well a candidate may say one of the following,
“I’ve read that your financials are really messed up. Whose fault is it and what are you doing to fix it?”
“I’ve read that the company is experiencing a period of financial difficulty; has the cause been identified and how could I contribute to the solution?”
The content is the same, but the manager would be justified for scratching the candidate for the first, while the candidate should drop the company if there is no valid response to the second

When your team is not doing as well as you like you can say,
“Your productivity has gone to hell and I need you guys to get your acts together and bring it back up.”
“Our productivity is down; we need to identify the causes and work together to turn it around.”
For which manager would you rather work?

Honesty may be blunt, even brutal when people don’t want to hear it, but that doesn’t mean it needs to be harsh.

(Hat tip to KG Charles-Harris for sending me the Forbes article.)

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As you probably guessed from the title I’m not a fan of Treasury Secretary Henry Paulson. I don’t trust him to do the tough stuff that a leader needs to do. He’s not only missing vision, he can’t seem to see the forest for his friends.

Actually, I think he’d be served best with butter and maple syrup.

Here are a few historical gems.

“We’re all trying to get our heads above the battle smoke and look for the real meaning of Enron to put it in perspective.” (What perspective? Enron’s leaders played illegal games that destroyed thousands of people’s lives and got caught. Seems pretty clear to me.)

“I don’t see (subprime mortgage market troubles) imposing a serious problem. I think it’s going to be largely contained.” April 2007 (How’s that for an insightful statement?)

“I don’t think it [the subprime mess] poses any threat to the overall economy.” July 2007 (At least he’s consistent.)

“The US banking system is well-capitalized and ‘we have a strong deposit insurance system that provides good coverage for the savings of hard-working Americans.” December 2007 (Of which we have fewer and fewer every day.)

“Looking forward, I expect that financial markets will be driven less by the recent turmoil and more by broader economic conditions and, specifically, by the recovery of the housing sector.” May 2008 (There spoke a Treasury Secretary with a real handle on reality.)

“It’s a safe banking system, a sound banking system. Our regulators are on top of it. This is a very manageable situation.” July 2008 (I want some of what he was on!)

“This market has for all practical purposes ground to a halt. Today, the illiquidity in this sector is raising the cost and reducing the availability of car loans, student loans and credit cards. This is creating a heavy burden on the American people and reducing the number of jobs in our economy.” November 2008 (Ya think?)

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See all mY generation posts here.

There’s not a lot of funny stuff out there today, but if you have a slightly twisted sense of humor you can find more funny stuff than you would think.

First up is compensation at AIG. In October the company spent just shy of a half a million dollars on a weekend meeting at a resort; when people got annoyed they canceled another 160 events valued around $8 million. A month later, in return for their bailout the top seven execs in the ‘Leadership Group’ (isn’t that a laugh) agreed to skip bonuses this year or salary increases through 2009 and CEO is taking an annual salary of $1.00. Whoo hoo. Of course, nothing I looked at mentioned a ban on stock options.

Next is a topic close to my heart. I love seeing common knowledge written up, especially when it’s common knowledge that the pundits keep refuting. BNET’s Dog and Pony spells out ten reasons that middle managers are more valuable than CEOs. Why? Because they’re the folks who drive customer retention.

Finally, I found a report entitled Executive Excess 2008 from the Institute for Policy Studies and United for a Fair Economy. “S&P 500 CEOs last year averaged $10.5 million, 344 times the pay of typical American workers. Compensation levels for private investment fund managers soared even further out into the pay stratosphere. Last year, the top 50 hedge and private equity fund managers averaged $588 million each, more than 19,000 times as much as typical U.S. workers earned.” I’m not saying that they’re completely impartial, but then, who is? Every group that publishes a study has its own ax to grind. It’s your responsibility to sort it out.

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