Talent and Transformation

A recent survey of HR leaders found that talent management is seen as the key to making HR more strategic. It also found that leaders at large organizations were more apt to use recruitment-process outsourcing than at smaller ones.

By Stan Lepeak

Making the human resource function more strategic is a perennial goal in most organizations. "HR transformation" is commonly identified as a key means to make HR more strategic. The challenge, however, is defining what transformation really is and then determining how to successfully undertake it.
EquaTerra and Human Resource Executive® together conducted a market study in late 2007 to explore the HR transformation topic. The study, based on an earlier one conducted by both organizations in 2005, assessed the realities of HR transformation, how organizations were pursuing it and the role that alternative service-delivery models, such as shared services and outsourcing, played in enabling it. It surveyed approximately 450 HR leaders based primarily in North America, 29 percent of whom were vice presidents of HR and 53 percent who were HR directors or managers.
The latest study, similar to the earlier one, found that while the majority of respondents felt their organizations viewed HR as a strategic asset, there was still a strong desire to further transform the function to improve its efficiency and effectiveness.
Many barriers were identified, however, including how to define, fund and gain executive support for transformation efforts. There were also differences of opinion as to how much transformation was about truly improving strategic capabilities versus just cutting costs.
These findings demonstrate that one of the key challenges HR organizations face in trying to become more strategic is defining exactly what "strategic" means. This definition will obviously depend on the organization, its size and its industry, as well as its current business and operating environment.
What makes HR strategic also depends on whose opinion is being asked. Some stakeholders view operational excellence as the key to being strategic. Their focus is on keeping costs down while increasing process efficiencies.
Others view the key to becoming more strategic as expanding the role of HR beyond operational activities to better support strategic business initiatives. To them, routine HR operational activities should take a back seat to more strategic work around talent and organizational effectiveness.
The challenge for HR leaders, therefore, is to define what "becoming more strategic" means in the context of their department's current situation and in the eyes of the key stakeholders and decision makers within their organization as a whole.
Even when HR leaders define the "what" of being strategic, they continue to struggle with the "how" of enabling it. HR departments have many tools and options at their disposal to transform and improve their processes. These run the gamut from process redesign and reorganization to investing in more (and hopefully, better) information technology to support the deployment or expansion of service-delivery models such as outsourcing.
The challenge lies in defining the right tools for the job and deploying them successfully while recognizing that most organizations have already tried many of these options with mixed results.
With these questions and issues in mind, EquaTerra and HRE launched the updated market study to determine how leading HR organizations today are addressing the what and how of making HR more strategic. The study assessed the importance of "total talent management" as a key enabler of strategic HR and the role of alternative- service-delivery models in improving organizations' talent-management capabilities.
HR Performance
The market study first assessed respondents' opinions regarding the performance of their HR operations from the perspectives of HR people and processes as well as HR/IT applications and systems. Respondents were consistently more satisfied with HR people and processes than with HR/IT. The mean score for people and processes was 3.19 on a 1-to-5 scale where one represents not at all satisfied and five represents extremely satisfied. On that same scale, HR/IT had an overall score of just 2.59.
These responses represent a decline from the 2005 study, wherein people and processes scored 3.41 and HR/IT scored 2.83. While some of this variation between the two studies is attributable to different samples, the decline also highlights that, overall, little progress has been made in many organizations over the past three years in improving HR performance.
HR groups in general fared well relative to their strategic importance to the organization, with the majority of respondents indicating HR is viewed as a strategic asset in their organizations. These response levels were little changed, however, from the 2005 study, which suggests that, while progress has been made, HR still has a way to go before it's considered truly "strategic." Indeed, many respondents who selected "other" as a response indicated that HR was "emerging," "evolving" and "progressing" as a strategic asset, but was not fully there yet.
Defining "Strategic" HR
While HR groups must clearly define what strategic means in their own organizations, the study's findings point toward a growing consensus about what "strategic HR" is. When questioned on what would make HR more strategic to their organization, more than 70 percent (see Figure 1 ) of respondents indicated it meant becoming a leader in total talent management (e.g., recruiting, performance, learning and succession planning).
Respondents from larger organizations (more than 5,000 employees) placed even more emphasis on talent management than smaller organizations.
Tactical proficiency and effectiveness in managing core HR processes -- typically where the bulk of daily HR activity is spent -- ranked fourth.
Respondents were also queried on which core HR processes and activities contributed most to making HR strategic. Talent management again came out on top (see Figure 2 ), cited by more than 70 percent of respondents, as did organizational effectiveness (e.g., workforce and performance management). Playing an advisory role for executives also scored well, while more routine HR tasks scored much lower.
Drilling further into the total talent-management theme, respondents were asked to rank the importance of talent-related issues and challenges in making HR more strategic and improving overall organizational competitiveness.
On a 1-to-5 scale, with one being not at all important and five very important, talent scored 4.39 overall, which points to improving total talent-management capabilities as a top opportunity to make HR more strategic. The question then becomes, "How to do so?"
Of Talent Management and RPO
HR organizations face many challenges in improving efficiency and effectiveness in any core area, especially something as diverse and complex as talent management. When asked what the key barriers to HR transformation were, survey respondents cited a lack of resources and funding, inadequate supporting HR/IT systems and a lack of executive support and sponsorship. These were similar to barriers cited in the 2005 study, underlining the ongoing nature of these challenges.
So if these challenges are recurring and formidable, how can HR groups overcome them? One approach is to look at the different means available for delivering core HR services. Ideally, these different models can not only improve process efficiency and effectiveness, but also free up HR resources to focus more strategically on critical topics such as talent management.
The market study assessed the role and value of alternative HR service delivery models -- shared services, HR/IT and HR business-process outsourcing -- in transforming HR to make it more strategic. Adoption rates for shared services and outsourcing varied significantly depending on the HR process addressed, and the size and industry of the organization.
Overall, benefits administration was the process most frequently supported through shared services, identified as deployed by 35 percent of respondents and planned by an additional 8 percent. Payroll was the process most frequently outsourced (24 percent deployed, 8 percent planned). The rates were higher, often significantly, for larger organizations and for commercial/non-public-sector organizations.
When asked to rank the importance of these alternative-delivery models in making HR more strategic, respondents scored them in the mid to lower end of the five-point scale. Respondents were also specifically asked about the importance of recruitment-process outsourcing to improving total talent-management capabilities. Figure 3 illustrates the perceived importance of each of the service-delivery models. Larger organizations and those in commercial industries again placed more positive emphasis on these models than did smaller ones and those in the public sector.
Relative to RPO, 19 percent of all respondents said their organizations had outsourced much or most of their recruiting-related activities. Thirty percent of respondents from organizations with more than 5,000 employees and 35 percent with more than 20,000 employees noted they had undertaken RPO.
The two key reasons cited by respondents whose organizations had not undertaken RPO were "not needed" (48 percent) and "too expensive" (34 percent). When the respondents who had undertaken RPO were asked to identify the benefits they sought from it, the majority (64 percent) cited "accelerate the recruiting and hiring process," while 58 percent chose "focus on more strategic aspects of recruiting" and 46 percent chose "improve service."
These respondents were also asked to list the specific hiring processes they'd outsourced to an RPO provider and rate (on a scale of 1 to 5) the results achieved by the vendor. All of the processes (which included sourcing, hiring, executive recruiting, staffing, contingent labor, drug testing/background checking and pre-employment testing) received average ratings of 3 or higher.
So, while a large number of respondents have not undertaken significant levels of RPO, those that have done so have experienced fairly positive results.
Relative to future RPO plans, the majority (53 percent) of organizations that have undertaken RPO intend to maintain their current levels of investments for the foreseeable future. Eighteen percent planned to maintain current levels, but renegotiate deals with their current RPO service providers or possibly switch to a different provider. Twenty-seven percent planned to expand RPO efforts into new areas) and less than 2 percent planned to curtail their RPO effort and bring the work back in-house.
Given that RPO usage was defined for the study as encompassing much of the recruiting process, it's not surprising that the expected expansion levels are lower than those for other types of outsourcing.
The role and importance of talent management in making HR more strategic is not surprising in today's market. Finding, attracting and keeping good people have always been of paramount importance to companies across all industries, and are even more important today, given the fact that competitive differentiation depends on the quality of an organization's talent.
Improving total talent management will be key for organizations during the next five years. HR groups that excel at this will be viewed as strategic, and alternative service-delivery models have the potential to be an important element of an improved talent-management capability.
Stan Lepeak is a managing director at EquaTerra, a Houston-based outsourcing advisory firm.

(HRExecutive)

Master these 10 processes to sharpen your project management skills

by Tom Mochal

Small projects don’t necessarily require much knowledge of project management or much project management discipline. But as a project gets larger, formal processes and techniques become essential. Different project management methodologies organize and structure these processes in various ways, but we’re going to focus on 10 basic areas:

1. Define the project
2. Plan the work
3. Manage the workplan
4. Manage issues
5. Manage scope
6. Manage risks
7. Manage communication
8. Manage documentation
9. Manage quality
10.Manage metrics

In general, if you can master these areas, you can succeed in most projects. You may not have to worry about managing documentation or metrics on a small project, but the larger your project, the more you’ll need to focus on all 10 processes.

Notice that our list doesn’t include analysis, design, testing, or implementation. Those who have worked on projects probably know that they typically include analysis and testing. However, there is a major distinction to be made. Analysis and testing are part of the actual project work effort (also called a project lifecycle). These phases change depending on the project type. If you have a full lifecycle project, you could perform the full range of analysis, design, construction, testing, and implementation. On other projects, you might do only certain components. For example, if you were performing a research and development project, you wouldn’t be doing implementation. If you were performing a study, the project might end after the analysis phase.

Do you see something missing?

Two processes are sometimes included as a part of basic project management: people management and contract and procurement management. People management is an important skill for project managers, but it’s not specific to project management. After all, any management-subordinate relationship requires people management. The distinction is that it’s a project “manager” skill, but not necessarily a project “management” skill.

We’ve also excluded contract and procurement management from our list. In most organizations, project managers need to know about the management of contracts and vendors, but they aren’t responsible for it. A legal department and/or procurement department is usually responsible for these disciplines.

Timing and sequencing of the processes

Except for the first two categories — defining the project and planning the work — the 10 major project management areas don’t fall into a sequential path. Processes 3 through 10 can be done in any order, and in fact, are done in a parallel and ongoing manner throughout the project. For example, if a major problem pops up, you must use issues management regardless of what other aspects of project management you’re using before, during, or after that time. Let’s take a closer look at each process.

Note: This information is also available as a PDF download.

#1: Define the project

As the project manager, you must make sure that the work is properly understood and agreed to by the project sponsor and key stakeholders before the project work begins. You’ll work with the sponsor and stakeholders to ensure that the project team and the client have common perceptions of what the project will deliver, when it will be complete, what it will cost, who will do the work, how the work will be completed, and what the benefits will be.
The larger the project, the more important it is that this information is mapped out formally and explicitly. All projects should start with this type of upfront planning to prevent problems caused by differing viewpoints on the basic terms of the project. The major deliverable from this step is the Project Definition (some companies call this a Project Charter).
At a high level, the purpose of defining the work includes:
Understanding and gaining agreement on project objectives, deliverables, scope, risk, cost, approach, etc. This is the most important part of defining the work and is where most of the time is spent in gaining common agreement.

Determining whether the original business case is still valid. For example, a project that requires 10,000 effort hours might make business sense. If the more detailed definition process results in a more refined estimate of 20,000 hours, the project may no longer be feasible.
Making sure the resources you need are available when you need them.
Providing a high-level baseline from which progress can be compared and scope can be controlled.

Gaining agreement with the client on the processes used to manage the project.
The effort required to define the work depends on the amount of information and the level of detail that need to be understood and documented. The duration required to define the work depends on the length of time necessary to discover and document the information, as well as the time required to gain agreement and approval from the client.

It may be difficult to define exactly what the final deliverables look like for large and complex projects. It is also difficult to estimate the total cost and deadline date. If that is the case, you can break the project into smaller projects. The projects that are done first should then be much easier to define. The projects that are to be completed in the future can be defined in detail as they get closer to execution.

At the end of the definition aspect, you should have a Project Definition that defines the expectations of the project in terms of objectives, deliverables, scope, risks, costs, deadline, and roles. This document should be formally approved by the project sponsor and other key stakeholders before the project team proceeds. At times, you can get frustrated because of the difficulty in gaining agreement with the client on scope, timeline, and cost. But that is exactly the reason this definition work is done ahead of time. Think of the problems you would no doubt encounter trying to gain agreement with the client on scope, schedule, or cost when the work had started and the deliverables were actually being produced.

#2: Plan the work

When you define the project, you make sure that you have an agreement with the project sponsor on what work should be completed in this project. In this stage, you determine how the work will be completed. This involves building the Project Workplan. You’ll take different approaches according to the size of the project. For example, the workplan for small projects can be built using a project management package like Microsoft Project, a spreadsheet, or even a piece of paper.

If you don’t have a workplan template to use as your starting point, you can use the Work Breakdown Structure (WBS), a technique for looking at the project at a high level and breaking the work into smaller and smaller pieces until you can get the full picture of the work. The entire team can collaborate on this exercise. I recommend breaking down the work into lower levels until each remaining activity is less than 80 hours, and it is clear what is required to complete the activity.

Once all of the work has been uncovered, you can sequence the activities and identify dependencies between them. At this point, the WBS has been converted to a Network Diagram.
Next, you add resources (workers) for each activity. If you know of certain resources, you can add them by name. If not, you can use generic names as placeholders. You then add the effort hours and the beginning and ending dates for each activity.

Your workplan is now ready to go. You’ll know what work you have to complete (Project Definition) and how you’ll get the work done (Project Workplan).
The relationship between defining and planning the project
You may find that you can’t complete the Project Definition without starting to lay out the overall Project Workplan. In many cases, you’ll need to work on these two deliverables simultaneously. As you gather information about scope and deliverables, you’ll need to start laying out a timeline so that you can get your hands around estimated effort and duration. When the deliverables, scope, assumptions, and approach are complete, you should have enough information in the Project Workplan to estimate the budget, effort, and duration, which you’ll use in turn to complete the Project Definition.

#3: Manage the workplan

At this point, you’ve finished defining the project and planning the work. The major deliverables in place are the Project Definition and Project Workplan. Some project managers think that defining and planning the work means that the hard part of managing the project is behind them. That is definitely not the case.

You’ll never be a successful project manager if you don’t keep the workplan up to date. Remember, the workplan is only a deliverable. It describes the work that needs to occur, the order of the work, how much effort is required, and who is assigned, but it represents only your best guess as to how to complete the remaining work at any particular point in the project.
The more complex your project is, the more change is going to be required in your workplan over time. As the project manager, you must evaluate the workplan on an ongoing basis (perhaps weekly) and determine the current state of the project.

During this weekly review, you’ll update the workplan with the current state of work that is completed and in progress. You’ll evaluate the remaining work to see if the project will be completed within the original effort, cost, and duration plans. If it can, you are in good shape. If it can’t, you must implement corrective action.

Of all of the skills of managing the project, this one is perhaps the most fundamental. Depending on the dynamics of your project, you may be in the position of having to constantly use your experience and creativity to get the project completed within expectations. One week, your project may be on track. The next week, you may have work assignments that are late and issues that have surfaced.

If an activity on the critical path is a week late, you can’t sit idly and allow the entire project to be a week late. Instead, you must evaluate the resources and options available and get the project back on track. If you’re good at it, managing the workplan can be one of the more challenging and rewarding aspects of project management. If you don’t relish the detailed work that is required, you may find it much more difficult to be successful.

#4: Manage issues

An “issue” arises when a problem will impede the progress of the project and can’t be resolved by the project manager and project team without outside help. If a major problem emerges, you have no choice but to resolve it. The only question is whether you’ll actively apply issues management to the situation or flounder through indecision and uncertainty about how the issue should be resolved.

Issues management has two major components. The first is having a process to uncover issues, determine their impact on the project, examine alternatives, and bring in people to make the best decision under the circumstances. This is all part of the project management procedures that should be defined and agreed to ahead of time. These procedures ensure that issues are recognized and resolved as quickly as possible.

The second component of issues management is applying specific problem-solving techniques. This includes some understanding of techniques such as Fishbone diagrams, Pareto charts, and root cause analysis. Having an understanding of one or more of these techniques allows you and your team to understand the nature and cause of the problem, what options are available, and what alternative would be the best course of action.

One important thing that all project managers discover is that having a process to resolve issues doesn’t mean you’ll successfully resolve every one. Sometimes, there are great alternatives to issues and your job is to help discover the best one. In other instances, there is no good resolution to a major problem. On occasion, your final choice is to pick the solution that causes the least harm or is the best among poor choices. Still, your issues resolution process and your problem-solving techniques will allow you to determine what options are available so that you at least understand the repercussions.

#5: Manage scope

Scope describes the boundaries of the project and defines what the project will deliver, what data is needed, and which organizations are affected. Given a set of resources and time, an infinite number of things can be delivered.

Scope change management starts with scope change definition. If the project manager hasn’t done a good job defining scope, it will be difficult to manage scope during the project. The purpose of scope change management is to protect the viability of the current, approved Project Definition. When the project was defined, certain expectations were set for what the project was going to produce for a certain cost and in a certain timeframe. Both you and the project sponsor have those expectations in mind when the Project Definition is developed and approved.
During the life of a project, there may be a need for items that are different from, or not included in, the original Project Definition; this is to be expected. If this occurs, the client should not expect that these items can be delivered using the previously agreed on resource and time constraints. The project team will identify the new requirements and determine the impact to the project if the new requirements are included. The information is then taken to the sponsor for approval.

Remember, the sponsor is the one who approved the funding of the work to begin with. Therefore, he or she is the one who should approve any changes to the original agreement. If the business value of the change is high enough, the sponsor should approve adding the new requirement to the project, as well as the incremental budget and timeline needed to complete the work. Everyone will then be in agreement and everyone’s expectations will have been reset.
Of course, sometimes it doesn’t happen so smoothly. Common problems include:

Scope creep. Large scope changes are easy to spot. However, when the changes are small, sometimes you find that you’re including them without realizing it. Scope creep means that you’re accepting small changes that end up having a significant cumulative effect on the project. You and the entire team must be diligent to guard for all scope changes — big and small.

End-user scope approval. The project sponsor is the person paying for the project. However, once the project begins, the team spends more time with lower-level clients and end users. Some project team members believe that scope changes are fine if the end user approves them. This is not the case. Unless the sponsor has specifically delegated the approval authority, these people can’t approve scope changes. They can raise scope change requests, but only the sponsor has the funding authorization to approve incremental work.

Team members not being accountable. A common cause of missing deadlines is that the team members end up doing more work than required. For example, a team member may be asked to create a report. As he or she is creating it, the client asks for new information. The team member tries to accommodate the client, and the work ends up being late. This happens when team members think that only the project manager needs to worry about scope change management. They need to understand that it’s everyone’s responsibility.

The root cause of many unsuccessful projects is poor scope change management. Defining and managing scope effectively will increase the chances that your project will meet expectations.

#6: Manage risk

Risk refers to future conditions or circumstances that exist outside the control of the project team and that will have an adverse impact on the project if they occur. In other words, whereas an issue is a current problem that must be dealt with, a risk is a potential problem. Reactive project managers resolve issues when they arise. Proactive project managers try to identify and resolve potential problems before they occur. This is the science and art of risk management.
Since smaller projects usually don’t have long durations, there is less opportunity for problems to develop. Larger projects usually have risks lurking just over the horizon. Risk management involves identifying all potential risks to the project, determining how likely they are to occur, and understanding the impact on the project if they occur.

With that information, the project team can determine which risks should be actively managed. For example, a risk with a high probability of occurring and a large impact on the project should definitely be managed proactively. On the other hand, a risk that has a high likelihood of occurring but a marginal impact on the project can probably be ignored.

Once you identify which risks you want to actively manage, you can invoke five general responses:
Leave it. You would leave a risk if you determined that your project would not be harmed if the risk occurred or if there was nothing that could be done to address the risk and you’re willing to take the chance that it won’t occur.
Monitor the risk. In this case, you don’t proactively mitigate the risk but you monitor it to see whether it’s more or less likely to occur as time goes on. If it looks more likely to occur later, the team must address it at that time.

Avoid the risk: Avoiding the risk means eliminating the condition that’s causing the problem. For example, risks associated with a particular vendor might be avoided if another vendor is used.
Move the risk: In some instances, the responsibility for managing a risk can be removed from the project by assigning the risk to another entity or third party.

Mitigate the risk: In most situations, this is the approach to take. If a risk has been identified and is a concern, you can develop a proactive plan to ensure that it doesn’t occur.
As with scope changes, there is nothing inherently wrong with having risks on a project. Clients don’t expect that a project will be risk-free. What matters is the project management response. If risks are identified and actively managed, the project has a much better chance of success. If risks are ignored, the project will be negatively affected when the risks turn into issues. At that time, there may be fewer options for resolution without impacting the project.

#7: Manage communication

Properly communicating on a project is critical for managing the clients and the shareholders. If they’re not kept well informed of the project progress, there is a much greater chance of problems and difficulties due to differing expectation levels. In fact, in many cases when conflicts arise, it’s not because of the actual problem, but because the client or manager was surprised.
There are two levels of communicating on projects. First, all projects should communicate status. Second, if your project is larger, more complex, or more politically charged, you need a higher and more sophisticated level of communication defined in a Communication Plan.

Status meetings and status reports
All projects need effective communication from the project team to the project manager and from the project manager to the rest of the stakeholders. Status reports and status meetings need to do more than just say whether the project is on track. This is the time you communicate everything you think needs to be known about your project. You communicate about adherence to the project’s budget and schedule, accomplishments from the last reporting period, planned accomplishments for the next period, new risks, current issues, and current scope change requests.

The information and presentation must be communicated with the audience in mind. Therefore, you would expect that a weekly status meeting with your team would include discussions at a fairly low and detailed level. Status reports you send to the sponsor and management stakeholders will necessarily be brief and high-level.

Communication Plan
Large initiatives, especially the kind that require organizational change, must include an overall Communication Plan that takes a multifaceted approach to communication. The process for building this plan includes defining all your stakeholders, determining what information they need, brainstorming ways to deliver that information, and then deciding on a set of communications that cover as many stakeholders as possible in the most resource-efficient manner.

Depending on the audience, the communication falls into one of three areas.
Mandatory. This includes status reports, budget reports, and legal and auditing requirements.
Informational. This is communication that provides extended information for people with a need to know more. Examples include a document library, frequently asked questions (FAQ), and a project Web site that contains relevant project information.
Marketing. This is communication designed to build enthusiasm for your project. Examples include publishing success stories, building a positive image, distributing management testimonials, and using a project logo.

Communication must be handled proactively by the project manager and must be planned and executed with a purpose in mind. If you communicate effectively and proactively, you’ll find that the entire project runs more smoothly and with less conflict and frustration.

#8: Manage documents

Many project managers take document management for granted until they’re inundated with hundreds of documents. It’s better to estimate the volume of project and project management documentation you think the project will produce, establish the proper processes and rules to organize the documentation, and then manage the documentation during the project to ensure that it doesn’t get out of control.

Project managers on smaller projects don’t need to give as much thought to managing documentation. As projects get larger, the documentation definitively needs to be actively managed. Problems at their simplest include documentation that gets lost or is hard to find and work that ends up being duplicated. At its worst, document versions get out of order, document updates get over-posted and lost, and confusion and uncertainty reign.

This is an aspect of project management that may be supported by a tool, such as a document repository. However, tools can be just as confusing if proper techniques aren’t used to store documents in a manner that allows them to be easily retrieved.

Document management involves simple and complex tasks. A simple activity, for example, is a document-naming convention. If you have 10 people on your team and each one submits a status report each week, it’s not long before you have hundreds of documents. It’s easier to organize the documents if everyone uses a common naming convention. Should the name of the document start with each person’s name? If so, then each person’s historical status reports will sort together and be easier to find.

Or perhaps you’ll want to search for status reports from particular points in time. In that case, the status reports should start with the date. Then all the status reports for a particular reporting cycle will sort together.

Another part of document management is understanding the types of document tools you’ll use. For example, you might define Microsoft Word as your standard document editor. If your team is cross-functional and includes clients, vendors, and suppliers, these types of document management rules become more vital.

Other factors must be considered to successfully manage documents. These include where you’ll store the documents, how they’ll be organized, access and security rules, keywords/indexing, naming standards, versioning, completion status, retention/purging, backups, and standard template formats.

#9: Manage quality

Quality is represented by how close the project and deliverables come to meeting the client’s requirements and expectations. In other words, quality is ultimately measured by the client.
The project team should strive to meet or exceed the client’s requirements and expectations. Sometimes there is a tendency to think that “quality” means the best material and equipment and zero defects. However, in most cases, the client doesn’t expect, and can’t afford, a perfect solution. If there are just a few bumps in the project, the client can still say that the project delivered to a high level of quality.

On the other hand, a flawlessly designed, defect-free solution that doesn’t meet the client’s needs isn’t considered high quality. The purpose of the quality management step is to first understand the expectations of the client in terms of quality and then put a plan and process in place to meet or exceed those expectations.

Because quality is defined by the client, it may seem that it is completely subjective. However, plenty about quality can be objective. This requires first breaking down the generic term of “quality” into a number of areas that define the characteristics of quality.

For example, you can think of a quality computer application in terms of response time, look-and-feel, ease of understanding, level of help documentation, and absence of defects. Once you’ve defined the more tangible characteristics of quality, you can look at each of them to determine how they can be measured with more objectivity.

Quality management is not an event: It is a process and a mindset. A consistently high-quality product can’t be produced by a faulty process. You need a repetitive cycle of measuring quality and updating processes.

Collecting metrics is vital to making the quality management process work. So, the ninth and tenth aspects of project management, managing quality and managing metrics, are closely tied. If you want to do a good job of managing quality, you must measure.

When the project is initially defined, the project team must understand the expectations of the client in terms of quality and plan the activities to meet those expectations in a Quality Plan. The Quality Plan contains completeness and correctness criteria so that the project team knows what the quality expectations are.

The Quality Plan also contains the two general quality processes: quality control and quality assurance. Quality control activities ensure the deliverables produced by the project meet client expectations. An example of a quality control activity is an inspection of each component that will be used to complete a final deliverable. Quality assurance activities ensure that the processes used to create the deliverables are of high quality. An example of a quality assurance technique is a checklist that contains all of the steps that a deliverable must complete before it reaches final acceptance.

One of the purposes of quality management is to find errors and defects as early in the project as possible. Therefore, a good quality management process will end up taking more effort hours and cost up-front in the project. However, focusing on quality early has a large payback as the project progresses. For example, it is much more efficient to spot problems with the business requirements during the analysis phase of the project than to redo work to add missing requirements during the product testing. It’s also much cheaper to find a problem with, for example, a computer chip when the chip is manufactured than to replace it when a client brings the product in for service after a purchase.

#10: Manage metrics

Gathering metrics on a project is the most sophisticated project management process and can be the hardest. Because metrics can be difficult to define and collect, they’re usually ignored or handled poorly. All projects should be gathering basic metric information regarding cost, effort, and cycle time. However, you must also collect metrics that determine how well the deliverables satisfy the client’s expectations and how well the internal project delivery processes are working. Depending on the results, you can undertake corrective action or process improvement activities to make the processes more efficient and effective.

Managing metrics and managing quality are related. It is difficult to improve the quality of your deliverables or your processes if you’re not gathering metrics. Metrics are used to give some indication of what the beginning state of quality is and whether quality is increasing or decreasing.

Many metrics can be gathered on a project. The project team should identify and collect a balanced set that provides the most value. To determine the right metrics for your project, you:
Identify the project success criteria in terms of product deliverables and project execution. That is, determine what your deliverables need to look like for the project to be successful. Also determine how your project needs to be completed to be considered successful-for example, budget and deadline expectations.

Brainstorm a set of metrics that provides an indication of the state of each success criterion.
Look for a balanced set of metrics that provides indications of success in terms of cost, delivery, quality, and client satisfaction.
Prioritize the potential metrics to come up with a list that provides the most value in the most cost-effective manner.

Set targets to allow you to determine success. Metrics are rarely of value alone. The value comes in measuring where you are against a preferred state or agreed on target. Add collection activities to the workplan to ensure that people are responsible for the metric collection and analysis process.

In general, metrics management is of less value on smaller projects because there isn’t enough time to capture the data, analyze the results, and make appropriate process improvement changes. Longer projects give you time to use a feedback loop. The most value is gained if the metrics are used to drive improvements on an organization-wide basis.

Randy Pausch Lecture: Time Management

Carnegie Mellon Professor Randy Pausch gave a lecture on Time Management at the University of Virginia in November 2007. Randy Pausch is a virtual reality pioneer, human-computer interaction researcher, co-founder of Carnegie Mellon's Entertainment Technology Center and creator of the Alice software project

Survival and the CEO

Long ago Peter Drucker, the father of business consulting, made a very profound observation that has been lost in the sands of time:
"Because the purpose of business is to create a customer, the business enterprise has two--and only two--basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business."
Today, when top management is surveyed, their priorities in order are: finance, sales, production, management, legal and people. Missing from the list: marketing and innovation. When one considers the trouble that many of our icons have run into in recent years, it is not easy to surmise that Drucker's advice would have perhaps helped management to avoid the problems they face today.

Ironically, David Packard of Hewlett-Packard fame once observed that "marketing is too important to be left to the marketing people." But as the years rolled on, rather than learn about marketing and innovation, executives started to search for role models instead of marketing models.

Tom Peters probably gave this trend a giant boost with the very successful book he co-authored, In Search of Excellence. Excellence, as defined in that book, didn't equal longevity, however, as many of the role models offered there have since foundered. In retrospect, a better title for the book might have been In Search of Strategy.

More recently, the popular method-by-example book has been Built to Last by James Collins and Jerry Porras. In it, they write glowingly about "Big Hairy Audacious Goals" that turned the likes of Boeing, Wal-Mart Stores, General Electric, IBM and others into the successful giants they have become.

The companies that the authors of Built to Last suggest for emulation were founded from 1812 (Citicorp) to 1945 (Wal-Mart). These firms didn't have to deal with the intense competition in today's global economy. While there is much you can learn from their success, they had the luxury of growing up when business life was a lot simpler. As a result, these role models are not very useful for companies today.

There is a growing legion of competitors coming at new businesses from every corner of the globe. Technologies are ever changing. The pace of change is faster. It is increasingly difficult for CEOs to digest the flood of information out there and make the right choices.
But a CEO can have a future.

The trick to surviving out there is not to stare at the balance sheet but simply to know where you must go to find success in a market. That's because no one can follow you (the board, your managers, your employees) if you don't know where you're headed.

How do you find the proper direction? To become a great strategist, you have to put your mind in the mud of the marketplace. You have to find your inspiration down at the front, in the ebb and flow of the great marketing battles taking place in the mind of the prospect. Here is a four-step process to pursue:
Step 1: Make Sense In The Context
Arguments are never made in a vacuum. There are always surrounding competitors trying to make arguments of their own. Your message has to make sense in the context of the category. It has to start with what the marketplace has heard and registered from your competition.
What you really want to get is a quick snapshot of the perceptions that exist in the mind, not deep thoughts.
What you're after are the perceptual strengths and weaknesses of you and your competitors as they exist in the minds of the target group of customers.
Step 2: Find The Differentiating Idea
To be different is to be not the same. To be unique is to be one of its kind.
So you're looking for something that separates you from your competitors. The secret to this is understanding that your differentness does not have to be product related.
Consider a horse. Yes, horses are quickly differentiated by their type. There are racehorses, jumpers, ranch horses, wild horses and on and on. But racehorses can be differentiated by breeding, by performance, by stable, by trainer and so forth.
Step 3: Have The Credentials
There are many ways to set your company or product apart. Let's just say the trick is to find that difference and then use it to set up a benefit for your customer.
To build a logical argument for your difference, you must have the credentials to support your differentiating idea, to make it real and believable.
If you have a product difference, then you should be able to demonstrate that difference. The demonstration, in turn, becomes your credentials. If you have a leak-proof valve, then you should be able to have a direct comparison with valves that can leak.
Claims of difference without proof are really just claims. For example, a “wide-track” Pontiac must be wider than other cars. British Air as the “world’s favorite airline” should fly more people than any other airline. Coca-Cola as the “real thing” has to have invented colas.
You can’t differentiate with smoke and mirrors. Consumers are skeptical. They’re thinking, “Oh yeah, Mr. Advertiser? Prove it!” You must be able to support your argument.
It's not exactly like being in a court of law. It’s more like being in the court of public opinion.
Step 4: Communicate Your Difference
Just as you can’t keep your light under a basket, you can't keep your difference under wraps.
If you build a differentiated product, the world will not automatically beat a path to your door. Better products don't win. Better perceptions tend to be the winners. Truth will not win out unless it has some help along the way.
Every aspect of your communications should reflect your difference. Your advertising. Your brochures. Your Web site. Your sales presentations.
There's a lot of hogwash in corporate America about employee motivation. Brought to you by the "peak performance" crowd, along with their expensive pep rallies.
The folks who report to you don't need mystical answers on "How do I unlock my true potential?" The question they need answered is, "What makes this company different?"
That answer gives them something to latch on to, and run with.

Customer metrics: What should you measure?

By Neil Davey


"Be careful what you wish for," the saying goes... "you might get it!" And this could be particularly apt when it comes to customer data.
There's been a spike in the demand for customer metrics recently. Firstly, an increasing number of CEOs are recognising that non-financial measures such as customer satisfaction are as important to their investors as traditional financial figures, a fact emphasised in Deloitte's 2007 study 'In the Dark'. But equally as significant is the increasing accountability that is being demanded of marketers, with the sector being asked to demonstrate its value now more than ever.

What CEOs and marketers may not have realised until this point, however, is the enormity of the task that faces any firm trying to cut a swathe through the mass of customer data that is at their disposal. Put simply, companies are up to their eyeballs in customer information – and they don't necessarily know what to do with it.

As highlighted in Deloitte's study, for instance, whilst leaders have an excellent idea of what traditional financial figures to use, they are bamboozled by customer data. 87% of companies are happy that their financial measurement is good, Deloitte reports, but only 29% can say the same about non-financial indicators.

And many marketing teams are similarly unacquainted with customer metrics. A 2007 study by VisionEdge Marketing revealed that whilst 78% of respondents track leads to conversion, only a quarter track and measure the rate of customer acquisition and fewer than 10% measure customer lifetime value or customer advocacy. Furthermore, a third of the marketing professionals questioned omit metrics from their marketing plans altogether.

Without a doubt, the sheer volume of customer data that is out there presents a daunting task. It's little wonder that firms are asking themselves what customer analytics and metrics they should – and shouldn't – be focusing on.

A broader focus

If you are looking for a showcase example of a company that has put metrics at the heart of its business, then supermarket Tesco is an obvious choice. However, according to Andrew Jordan chief operating officer of beyondanalysis, it also represents a good example of where customer metric models can frequently go wrong. "There are two fundamental flaws in its model," says Jordan. "Firstly, it relies on a very heavy level of transaction data and secondly it only attaches itself to customers."
An oft-quoted problem associated with transactional data – as with focus on similar financial measurements such as profit margins – is that it encourages leaders to drive their firm using 'the rear view mirror'.

"Purchases, repeat visits, length of call time… many companies track key performance indicators (KPIs) to monitor the successes and failures within the business – including customer satisfaction and churn rates – but the data produced only tells you what has happened and nothing about the underlying drivers of these trends," says Gary Schwartz, VP of product marketing at Confirmit. "The CRM industry is based on examining historical purchase behaviour in order to unlock the secrets and predict purchase behaviour but more often than not, however, repeat purchases are simply a function of lack of other choices!"

A focus solely on customers is similarly misplaced, as it results in the metrics completely omitting anyone who has failed to consider shopping at Tesco or those who have proactively decided not to shop there. "Anyone and everyone has the potential to become a customer, whether they have been a customer in the past or not," stresses Jordan. "So to use metrics that only attach themselves to known quantities is very traditional... very CRM-based. It misses a vital dimension because all you are doing is looking at things like share of wallet and repeat purchases and traditional value. They're all very well, but you've got to start earlier in the journey and understand how these things came about in the first place. A lot of the advice that we give companies is to think in a broader context about how they go about aligning the same metric approach to things like customer acquisition as they do with their own customers."

The internet in particular has created a wealth of data on non-customers for firms to exploit according to Jordan. "I'm referencing the rather murky world of social media, but also the fact that people are now collaborating electronically a lot more and that is creating a very rich stream of data which tells you a lot more about how people lead their lives, why they make the decisions they do, which ultimately inform purchasing decisions."

With the field of 'customer experience' gaining growing prominence, it's no surprise to learn that firms are increasingly looking to apply metrics to 'experiential' aspects. But with so many firms running on ‘command and control' metrics, this doesn't necessarily mean that companies are any better at delivering the experience to their customers that their brand values demand. Indeed, with it could be argued that in many cases the result has simply been that they only deliver what they measure. And without input from – and empowerment of – those employees 'at the coal face', the firm may not even be looking at the most appropriate metrics.

"It's clear that the metrics set at the top of the organisation – usually around shareholder aspirations – dictate the behaviours of that organisation toward customers," suggests Tony Mooney, consulting and propositions director at Experian Integrated Marketing. "These are rarely customer experiential metrics, in our experience. The nearest many organisations get is the use of customer satisfaction surveys and average call answering statistics - neither of which adequately measure customer experience.

"For example, most companies with call centres use average call answering as a KPI. This is merely a hygiene factor and, anyway, is usually inaccurate as it measures call answer times from the point at which the poor customer has made it through several layers of IVR. Of far greater importance than how quickly you pick the phone up is how the call is handled, eg single contact resolution. For other organisations, customer behavioural metrics will be key – such as downgrading and requests to cancel. Understanding the key customer metrics is a process of sound causal analysis – to identify the important drivers of customer behaviour and monitor those. Too many organisations try and manage 'output' metrics and miss the indicators."

Getting the metrics mix right

Clearly the quest for a single customer metric that holds the key to success for every company is a futile one. Behavioural metrics and experiential metrics have an important role to play alongside the more traditional ones for the modern business. But different metrics will hold a different value for different firms. So is there a way to establish the most important metrics specific to your firm?

One approach is the balanced scorecard. The balanced scorecard, arguably the most widely-used management framework of the last 50 years, allows firms to take all the potential metrics available and weight them and then track them over time. The process would, for instance, involve firms drawing up a list of key customer goals - perhaps customer satisfaction, new customer acquisition, customer retention, customer loyalty, fast response, efficiency, reliability or image – and then creating a number of metrics to measure success in the fields – which could consist of a focus on customer satisfaction index, repeat purchases, market share, on-time deliveries, returned orders, new customer acquisitions or perceived value for money.

"The question is whether all customer measures are of equal importance – and if not, how do we decide what we should be focusing on?" says Dana Guthrie of the performance management group at Actuate. "No two organisations have the same strategy, so every company needs to make its own judgement about the most important customer measures for themselves. The [balanced scorecard] process, though, is always going to be the same: a top-down approach of applying your own unique strategy and objectives to decisions about what to measure."

On the face of it a common-sense approach, the balanced scorecard actually involves a rigorous process to select and define the key measures that will ensure successful strategy execution.

Some scepticism of the technique's effectiveness in this area exists, however. "It strikes me very much of management overkill and of trying to design a complex mechanic for something that shouldn't be that complex," says Jordan. "And the problem of doing that, not withstanding the actual process of putting a balanced scorecard together in the first place, is that you'll be continually trying to challenge the validity of the scorecard rather than the validity of the results. The danger is that you will over complicate something that doesn't need to be complicated."

Nevertheless, whilst the balanced scorecard approach is not a guarantee of success when it comes to incorporating customer measures into the performance management mix, it has proven popular – as its longevity attests.
Professor Robert Shaw, though, believes there is a far simpler way that companies can identify the most important metrics and jettison those that are surplus to requirements – by evaluating their value to the decision-making process.
"The first thing is that people need to focus away from the data and onto the question of decision support," he suggests. "Many firms haven't stepped back and asked themselves if the data is actually supporting their decision making. You should ask the question: what are the main applications in this in terms of decisions? You can do audits of how you are applying the data and analytics technology and expertise to answer key decision questions. What comes out of those audits is a great deal of clarity about the value of the technology and data to the decision-making process. And then you can start to prioritise them."
Certainly firms need to take some action to wrestle control of their customer data – a problem that has been especially exacerbated by the internet. "There are a few hundred new metrics available to firms that they can capture that they didn't have a few years ago," agrees Neil Morgan, VP marketing EMEA, Omniture. "It's the biggest change I've seen in consumer marketing. Most traditional business people are struggling to interpret it or action it. The big requirement is to be able to raid this, adapt these metrics and make them useful in a business."
But Shaw insists that there is a dawning realisation amongst some firms that the focus should be on quality – not quantity.

"We used to get a bucket load of data, now it is like having a fire hose pointed at us - and firms don't know what to do with it," he concludes. "A radical rethink is needed. Companies need to take an axe to research and cut the stuff that is not illuminating the decision-making process. The enlightened companies are already doing this. They are asking themselves what decisions they are taking – whether it is to do with direct marketing, or pricing, or how much they advertise, or product/service quality. And then they are asking themselves what they can actually do about something like service quality and how they can measure if that has an effect which ultimately finds its way back to the financial results of the company. And unless it throws some light on the way that service or price or whatever hits the bottom line, then these enlightened companies simply won't be interested in that research."
The rest of the market, however, may yet be rueing the day they wished for more customer data...

Microsoft Needs a Blue Ocean Strategy

by Dr Sarah Layton,

“What is Microsoft thinking?” asks Florida-based corporate strategist Dr. Sarah Layton of the software titan's hostile bid for Yahoo. Layton advocates the cutting-edge business approach known as Blue Ocean Strategy, which creates brand-new market space where no competition yet exists based on creating value innovation for customers.Some think Microsoft's acquisition of aQuantive might be Phase 1 of a Blue Ocean Strategy and its hostile bid for Yahoo the Phase 2 of a Blue Ocean Strategy, but Layton disagrees. “While these acquisitions may increase share of the on-line advertising market and make Microsoft more competitive, competitors already exist and will be hot on their heels,” she says. “They are simply buying more space in the already bloody red ocean of competition.” The acquisition of aQuantive appears a perfect fit for Microsoft if they want to be more competitive in their current market. Layton explains, “aQuantive's technology targets ads based on Web surfers' habits. That opens large swaths of new customers to Microsoft, but the markets will soon be flooded with competitors after the same business.” So, what is the benefit of getting Yahoo? “The basic job of any Web site is finding things online,” Layton continues. “Both Microsoft's Windows LiveSearch and Yahoo handle many searches as well as Google or Ask. But once people are used to one search engine, it's very hard to get them to change.” Both companies have important sites. Microsoft has a portfolio of sites, but none of them has attracted the consistent use of Yahoo's Flickr. “Yahoo's acquired sites - specifically, Del.icio.us and Flickr -- have had only minor upgrades over the years,” Layton adds. “In the blog arena, Yahoo cancelled its 360 site last year. Both companies have managed to have their instant messaging networks work seamlessly for the past 18 months. If that model has worked, why buy Yahoo?” So, the question remains for Layton: “Where are the new Blue Ocean customers that the combined Microsoft-Yahoo will bring to the table? My answer to that question is there aren't any -- and the lead which the new companies might enjoy will be hard fought and short lived.” “The Red Ocean just got more bloody,” she concludes.

The Secrets of Breakthrough Companies

by Mike Hofman
Inc.com

Ten years from now, who will fly in the private jet--you or the guy next to you at the trade show? Which company in your industry is most likely to grow by leaps and bounds and why? These are the questions Keith R. McFarland tackles in his new book, The Breakthrough Company, published this month by Crown Business. McFarland is a management consultant and the former CEO of Collectech Systems, a collection agency for telecom companies. An acolyte of Peter Drucker, McFarland once asked the management guru how to tell which companies in an industry were likely to grow large. "I don't know," Drucker replied. "You need to write that book." And so he has. McFarland did in-depth studies of nine Inc. 500 alumni that had reached more than $250 million but less than $2 billion in annual sales by 2004. The idea was to examine companies big enough to have overcome major obstacles but still small enough that McFarland could see the patterns that led each company to its breakthrough moment. Why do some companies grow so dramatically, while others just shuffle along? McFarland recently shared his findings with Inc. executive editor Mike Hofman.

How do you create a breakthrough company? Where do you start?

First, I'd say that it's not about being in a hot, sexy market. It's not about having the coolest, hippest product. We came up with an index of companies that grew to a certain level both in terms of their annual revenue and in terms of their financial performance, compared with the rest of their industry. And the breakthrough companies we identified came from all different worlds. Sure, some of them make software, but others provide professional services like leasing office space or staffing or processing payroll. Chico's sells women's clothes, and Fastenal distributes tools and nuts and bolts. This tells me that within every company in every kind of industry, there are the seeds of breakthrough.

What about the people who run these companies? What are they like?

The high-performing companies we looked at had one thing in common--they were almost all run for many, many years by their founders. But these entrepreneurs don't share a common personality type, and they do not create businesses where there is a focus on the personal characteristics of the entrepreneur. They don't see themselves as responsible for the vision of the company. Rather, they seek to create an environment where people understand the strategy and can spot strategic opportunities as they crop up. Breakthrough leaders are less concerned with people's personal loyalty to them and more concerned about building a place where everybody is loyal to the company first--even if that means disagreeing with the big cheese. The founders of breakthrough companies appear to be good at getting out of the way. In every case we looked at, the leader was proud of the organization but decidedly humble about his role within it.

Are you saying they are wallflowers?

No, this isn't to say that these guys are overly humble or timid. They are all different types. Tom Golisano, who runs the large payroll processing company Paychex, has a big, commanding personality. In contrast, Mark Smith, founder of Adtran, a telecommunications company, whom I interviewed shortly before he died, was an engineer and spoke with an engineer's pattern of speech. He was very careful in the language he used when he spoke. In general, these men are as different as you can imagine. But they share a perspective about business, an insight about how people work. They all see that it is very important that the company not be about them.Let me give you an example: One breakthrough company is Staubach, the commercial brokerage business run by Roger Staubach, the same Roger Staubach who was the quarterback of the Dallas Cowboys for many years. I went to interview him for this book, and I walked into his office, and the first thing out of my mouth was, "Roger, where are your Super Bowl rings? Where's your Heisman trophy?" And he said, "No, we're building something much bigger here than Roger Staubach." I thought that was a throwaway line, but then I heard variations of it again and again. The CEOs who run these breakthrough companies take a different view of their role than other CEOs I know.

What does that mean in practice?

They are very tolerant of people within the company who insult the business and who insult the strategy they have come up with. By that, I mean that when employees say something in the business is screwed up, the entrepreneurs don't tell them to shut up. They also let people pursue ideas for new businesses even when they think they are wrong. The companies are made up of people who really, really want the best ideas to get out there.

What's an example of that?

For years, Tom Golisano resisted collecting payroll taxes. He believed the company should remain focused on processing payroll. He thought the tax collections business would be a distraction. One of his sales executives, Walter Turek, kept after him, and finally Golisano gave in and decided to test the idea. It worked so well that today, payroll tax collections account for an enormous percentage of Paychex's profits.The same thing happened at Chico's. Marvin Gralnick, the founder of the company, really believed in Pazo, a new hip, low-cost apparel chain, even though it was losing money. But another executive, who succeeded Gralnick as CEO, closed that chain down and invested in upscale stores called White House Black Market. That turned out to be a huge moneymaker for the company--more than $360 million last year. And the company has the highest sales per square foot of any apparel retailer in the country and one of the highest profit margins in the industry.

And when an employee's idea doesn't work out?

The first person I interviewed for the book was Scott Cook, of Intuit. He once gave out a "failure of the year" award to the team within his company that produced a flop that the whole company learned something valuable from. None of these companies are afraid of taking risks. They periodically make big bets in new lines of business. They are curious enough to try new things.

Are these companies great at hiring people?

Yes, but more to the point, they are great at developing people. One statistic that blew me away came from Fastenal, the nuts and bolts distributor. The average tenure among the top 25 employees there is 23 years, which means that the people who ran the company in 1985, when it was small, are running it today, when it has $2 billion in sales. And Fastenal employs 1,500 in Roseau, Minnesota, where the local population is roughly 2,700. What Fastenal and these other companies recognize is that to get really big, they have to create a culture that is so easy to learn and live by that ordinary workers can thrive. Fastenal, which is a pretty frugal company, spends very lavishly on rigorous employee training.

What are these founders like as managers?

They are good at settling internal disputes in creative ways. There's a legendary story at Staubach about two brokers getting into a fight over a commission. Roger called them in and heard both sides. There was serious money on the table. Roger said, basically, "Here's what we're going to do. We're going to give the whole thing to charity. And any time we're squabbling over money, let's do something good for the world, because this doesn't get the company anywhere." And you know, I bet he never had to mediate a conflict over a commission ever again.

You mention in the book that, in addition to listening to outspoken employees, these companies look outside the organization for good ideas. How?

The best company builders think like any smart builder--they use the business world version of scaffolding to build their companies. By scaffolding, I mean that they relied on outside support and structure while they were building their businesses. To a person, the entrepreneurs I profiled were either active in peer groups like Young Presidents' Organization, or they were tied in very closely with local research universities. SAS, the software company, works very closely with researchers at North Carolina State, and Fastenal has a relationship with the University of Minnesota. Paychex is really smart about using industry analysts at the big investment banks to learn more about trends in its industry.Marvin Gralnick, of Chico's, went out of his way to recruit the best possible board for the retail industry. Chico's is big, but it isn't one of the top two or three retailers in the country. And yet Gralnick built a board that is a real who's who of retailing, with the former chairman of Macy's, the former chairwoman of the Limited, the vice chairman of Staples, the former CEO of Tommy Hilfiger, and so on. Gralnick says it really helped him to make the decisions he needed to reach a billion dollars.So many entrepreneurs are afraid of having powerful boards because they don't want to lose control. Or, in the era of Sarbanes-Oxley, they look for board members who will be strong on compliance issues. That's missing an opportunity and focusing on the wrong stuff, I think. Gralnick reminds us of the value of having advisers on your board who can provide you with real strategic advice.

Why do so few companies break through?

Think about what makes small companies successful. They are small, so they can move fast without a lot of organizational friction. They can compete favorably on cost because they have low overhead. Their output per employee is high because there's a Band of Brothers environment at most of them. They are close to the customer. But growth by its nature negates these advantages. Breakthrough companies discover different leverage points--like outside advice or strong boards or maverick employees who lead them into new lines of business.

Jack Canfield: The Success Principles

When Jack Canfield talks about perseverance, he speaks from experience. His best-selling Chicken Soup for the Soul series was rejected by over 144 publishers before going on to sell over 100 million copies. He's been a teacher, facilitator, and psychotherapist. His seminars and trainings have touched millions of individuals from welfare recipients to corporate leaders.

- How what you think makes you weak or strong
- Seven key areas in creating a personal vision
- Two simple questions that accelerate the achievement of your goals
- How to change the outcome of any event, simply by changing your response to it
- The Rule of Five for achieving your "breakthrough goal"

Jack canfield is uniquely qualified to coach you on success. He's devoted more than 30 years to uncovering universal principles for achieving extraordinary outcomes. In this fast-paced, entertaining and powerful program, Jack will share his latest breakthrough principles and detail how you, too, can use them to rapidly achieve your goals in your career, your finances and your personal life.

2007 NADA Convention, Jack Welch

Bill Gates Speech at Harvard (part 1)