Charles Kovess discusses six practical strategies to increase your ability to compete globally. He shows why acting contrary to conventional wisdom is so important and explores the need for courage to fight the cynics and non-believers. In this 'Knowledge Age', he challenges us to think about where knowledge actually resides in our organisations.
Many organisations loudly proclaim, "Our people are our greatest resource", and then later announce massive downsizing strategies, to "get their cost structures aligned with world competitive practice!" What damage is being done to these organisations? Banks have been downsizing in the past decade to such an extent that finance brokers, are reaping huge rewards because banks do not have the peoplepower to deal with smaller, yet profitable, transactions. I see a lemming-like tendency by many Australian companies to follow the USA in terms of cost cutting, particularly in terms of employees. How do organisations build relationships if they do not have sufficient people?
Organisations who play this crazy game are paying a massive price in terms of their asset base, in maintaining their true sustainable competitive advantage. Few organisations have unique services or products. Decades ago, when an innovative advantage was gained, the innovator kept it for a few years. Now, innovation lasts only a few weeks. An organisation's true uniqueness, its global competitive advantage, is its people: their energy, passion, creativity, knowledge, wisdom, and the quality of their relationships, both internally and externally. How can an organisation maintain these valuable and beneficial relationships? Investment in people is the answer. So, what should a business do? How will it ensure its future in a gobalised, cost-cutting economy? There are six key strategies that must be kept in balance.
- Great teamwork
People must know how to work together. We must access people's differences to be competitive. The principles of great teamwork are not always well-understood in the corporate world. An excellent book on this subject is Ken Blanchard's The One Minute Manager Builds High Performing Teams.
- An inspirational purpose
I wrote about this in the article "Four Vital Ways To Activate Your Corporate Vision". In summary, few companies have inspirational purpose (or mission) statements that engage their people's spirit.
- Openness of communication
Telling the truth in the corporate world is a risky business, and yet if we don't, the real issues and problems cannot be addressed. CEO's require great courage to hear the truth. It requires practice, a recognition that mistakes will be made, and that upsets will occur, but it must be done!
- Commitment to development of people
Developing people skills is like training for a marathon: it's an ongoing process, yet, most leaders and managers expect their people to change overnight, after a training program. Wisdom is required, which enables a commitment to people to be long, rather than short-term, "quick fixes".
- High financial rewards based on performance
How do you measure performance, and who is performing? That's where the need for open communication and teamwork manifests itself. If people relate openly to each other, sharing views on performance, and appropriate rewards, is more likely to happen.
- Alignment of individual purpose to the corporate purpose
When individual purpose is fulfilled through the achievement of corporate purpose, magic happens! This was the key to Wal-Mart's success, according to Sam Walton, in Jeffrey Pfeffer's recent work The Human Equation. If you look after employees, and give them what they need, then employees look after customers, and that's the key to success.
I acknowledge the challenge faced by investing in people, but paradoxically, an investment in people will reduce costs, increase loyalty, increase performance, and it will ensure long-term, global, sustainable competitive advantage. Leaders need to passionately believe this to be true. They will then be willing to challenge the non-believers, only interested in next quarter's profit results.