Organizations Need Profitable Growth

There is a saying that “an organization can’t cut its way to profitability“, at least on a sustainable basis.  While this is certainly true over time, many organizations have implemented internal cost reduction programs over the past several years to improve profitability in the face of the poor economic and market conditions.  Although the majority of these programs were probably overdue, and have been effective, many organizations are finding that there is not much more that can be done internally without sacrificing service, efficiency, and quality.

As a result, organizations must now look outward, and improve their profits through profitable revenue growth.  However, this growth must be planned, managed, and controlled in order to make it sustainable over time, and generate the desired results.

One of the more popular, and potentially dangerous, strategies, is growth for growth’s sake, using the tactic of cutting prices, and hoping to “make it up on the volume” to improve profitability.  While there may be some special situations where this tactic may actually work (at least for a period of time), in most instances, the increased revenues will not be enough to offset the lower profit on each sale, reducing overall profitability over time.  In the worst case, some organizations will continue to cut prices, further reducing profits, eventually threatening its survival.

The dangers associated with this strategy include the following:

  • While the lower prices may, in fact, generate more revenue in the short term, this revenue may not be profitable for the organization due to the higher costs, and increased activity required to support it.
  • In many instances, cutting prices will result in an overall decline in market prices, setting the expectation of customers for those lower prices.  Once this happens, it generally takes a long time to get prices back up to reasonable levels.
  • Finally, if the growth occurs too rapidly, and is not profitable, the organization may find itself without the resources or financing required to support the growth, and unable to manage the activity properly.  This will lead to service and quality breakdowns, and the potential for future revenue declines.

Generally, no organization can be successful in the long term with this strategy.

Profitable, and sustainable, growth results from a strategy that is well designed, managed and controlled.  In order to accomplish these objectives, the  organization should ask itself several key questions:

  • Where will the new profitable business come from?
  • Do we know our real costs, and are they competitive?
  • What are the additional costs and resources that will be necessary to support the future growth?
  • What is the real profitability of our current customers, and/or market niches?
  • Who are our most profitable customers, and can we increase our share of their business?
    • Are there more potential customers like them in our market?
  • Can our existing processes and procedures handle the increased activity without a breakdown?
  • What differentiates us in the market, so we are not competing just on price?

The answers to these questions may lead to even more questions, all of which will assist you in defining your profitable growth strategy, the requirements of that growth, and how best to manage and control it over time.

Those organizations that can define and execute a clear strategy for profitable growth, and manage and support it properly, will sustainably improve their profitability.

If you have any questions, or would like to discuss your organization’s specific issues, please give us a call at (727) 637-4666, or email me directly at Don@HuttlinAssociates.com.

“Without continual growth and progress, such words as improvement, achievement, and success have no meaning.” – Benjamin Franklin

“Companies that grow for the sake of growth, or that expand into areas outside their core business strategy, often stumble. On the other hand, companies that build scale for the benefit of their customers and shareholders more often succeed over time.” – Jamie Dimon

“Growth is never by mere chance; it is the result of forces working together.” – James Cash Penney

Are You Taking Care of Your Customers?

As we work with our clients, many of them believe, rightfully so, that their particular organization is unique, and requires a number of complex processes, procedures, and reporting for their operation to work efficiently.  However, while there is nothing wrong with being unique, too many organizations make their operations much more complicated than they need to be.  As a result, the organization gets bogged down in the process, procedures and reporting, and loses its focus on the most important goal of any organization – Taking Care of the Customer, in the most cost efficient way.

Let me give you an example from my sailing days.

Tacking a sailboat is basically a four step process including turning the boat to the new course, releasing the sheet on one side, pulling in the sheet on the other side, and trimming for speed.  All a straight line process to accomplish one goal.  Yet, I have seen this simple process become very complex when there are too many hands involved, and/or too much talking and direction, resulting in a very inefficient process and a bad tack.

If we apply this straight line concept to an organization, there are really only three major steps for the entire customer fulfillment process, regardless of the organization, service or product lines.  These steps include:

  • Receipt of a customer/client order, or request
  • Taking action required by that order or request, which could include:
    • Ordering material
    • Processing that material
    • Performing a service
  • Delivering that product or service, cost effectively

That’s it.  Now I realize that the list is oversimplified, and that there are a myriad of details and actions required for each step, but the question is – Are all of those details and actions required to fulfill the customer’s request as efficiently and effectively as possible?  Probably not.

As you look at your organization, ask yourself some key questions:

  • Do you have processes and reports in place because this is the way it’s always been done, or just in case?
  • Is your organization getting bogged down following the processes and procedures, or filling out reports?
  • Does your customer see value in all of your processes and reports?  Are they willing to pay for them?
  • Can you fulfill their request in a straight line, or have detours grown up over time that are inefficient?

Depending on your answers, you may need to take a hard look at your operation, and update the processes to make them more efficient and effective.

Successful organizations have the following attributes:

  • Processes move in a straight line, with as few steps as possible
  • Processes, procedures, and reports have perceived value for the customer
  • The processes and procedures are cost effective, and efficient
  • The client/customer experience is the best it can be

It all comes down to just two objectives:  A great customer experience at the lowest cost.

It’s all about the customer.  How does your organization compare?

If you have any questions, or would like more information, please give us a call at (727) 637-4666, or email me directly at Don@HuttlinAssociates.com.

“Reduce the layers of management. They put distance between the top of an organization and the customers.” –  Donald Rumsfeld

“Quality in a service or product is not what you put into it. It is what the client or customer gets out of it.”Peter Drucker

“The single most important thing to remember about any enterprise is that there are no results inside its walls. The result of a business is a satisfied customer.” – Peter Drucker

Are You On Course?

Many organizations have just completed their First Quarter, and should be asking themselves several key questions:

  • What Were Our Actual Results?
  • How Do They Compare to Last Year and Our Budget?
  • Did We Make Money?
  • What Was Our Cash Flow?
  • Are We On Course?
  • Are We Making Progress on Our Objectives?

If these questions can’t be answered accurately, your organization may be off course, and drifting.

To determine your position, progress to date, and course, you must have accurate and timely reports including, at a minimum, an Income Statement, Cash Flow Statement, and Balance Sheet.  These reports will provide most of the information necessary to answer these questions, and should be carefully reviewed to identify where your organization is presently, and any changes in conditions that may be affecting your performance and course.

Other, related reports will also be of benefit, including Sales by Customer, Productivity Measures, and Accounts Receivable and Inventory aging, among others.  The key is to get as much detail as possible to identify significant variances from either the prior year, or budget, and the root cause(s) of the variation so that appropriate action can be taken to get back on course.  At the same time, these reports will also help to identify trends, and potential issues that may require action in the future.

Finally, assuming that specific objectives have been set for the year, the progress on each one should be reviewed, in detail, to insure that determine if you are on course.

Successful organizations also prepare forecasts of their results for the next quarter.  This will help identify potential operating and cash flow issues, in advance, so timely action can be taken, if necessary, to keep that organization on course, and under control.

The bottom line is that organizations must have accurate, timely information and a regular review process in place, to properly manage and control operations, identify position, progress, and course deviations that may require action, as needed, to keep the organization sailing toward its destination.

“Keep your hand on the helm.” – Matthew Goldman

Sailing requires the management of all the systems on the boat, plus all the controls on the boat, while assessing the weather and navigation. It’s planning everything to a fine level of detail and making the required adjustments all at the same time things are changing” – Unknown

 

Leadership Principles – Volume 3

In this, the final post of our Leadership series, we look at the last three of George Marshall‘s Nine Principles, including:

  • Focusing on the Big Picture: The Principle of Vision
  • Laying the Groundwork: The Principle of Preparation
  • Sharing Knowledge:  The Principle of Learning and Teaching

We’ll also distill all of the Principles and postings down to a simple summary of what it all means.

First, let’s review the last three, and how they can apply to your organization.  While these particular principles apply to the leader, they also have a significant impact on the entire organization and how it operates.

Focusing on the Big Picture: the Principle of Vision
Every organization must have a vision that defines its direction and objectives for the future.  Unfortunately, many small and medium size organizations (and some large ones, as well), do not have a vision, or have a vision that has not been shared.  As a result, these organizations tend to swing from one direction to another over time, with no alignment of performance or goals, and their leaders tend to apply the management solution du jour to try to identify where it is ultimately going.

Effective leaders first establish a vision, and communicate it, clearly, to the entire organization.  This allows for  identification of those areas/actions that the organization must focus on, and alignment of the activities and objectives required to achieve that vision.

Leaders must also identify the members of the organization that either choose not to support the vision, or that can’t or won’t see the big picture, and move them out quickly.  In addition, trivial activities, that don’t move the organization in the right direction, should be avoided so as not to get bogged down, or distracted.

Laying the Groundwork: The Principle of Preparation
As organizations begin to make significant progress toward the vision, some leaders may get complacent and put the required activities on auto pilot.  As a result, they are surprised when events or issues occur that take them off course, and/or threaten their future. The key is to prepare for these potential events.

First, there is no such thing as an organization just staying in place.  If it is not moving forward, it is actually moving backward.  The leader and organization must constantly review their operations to identify for new opportunities for growth and improvement, and worst case scenarios.  This ongoing review will allow the organization to prepare and plan for the potential future, and stay on course, regardless of event.

Sharing Knowledge:  the Principle of Learning and Teaching
As noted above, organizations cannot stand still, and must constantly evolve, and move forward through learning and teaching.  This is especially true in today’s environment, where conditions and technology are changing so quickly, that it is critical to understand and stay ahead of those changes.  Without this learning and teaching, organizations continue to repeat the errors of the past.

Effective leaders learn constantly and share their learning, expertise and vision with their organizations on a regular basis.  In fact, Jeffrey Immelt, the Chairman and CEO of General Electric, states that one of a “leaders primary role, is to teach the organization. People have to feel that you are willing to share what you’ve learned, and what the organization is doing, in terms that are understood by all.”

One tool to accomplish this is for the leader to ask their organizations from time to time, “What do you think we should do?” to resolve a particular issue.  This helps the leader connect with, share, and teach their organizations to think constantly about different ways to solve problems and issues, and exploit new opportunities for the future.

What Does This All Mean?
If we summarize the Nine Principles, and related postings over the past few weeks, we can simply say that:

True leaders have the values and courage required to establish, and communicate, the vision and direction of the organization.  They establish open cultures that encourage communication and debate, live the values, focus and align activities around the big picture, avoid trivia, and constantly learn and teach the organization to think, prepare for, and identify opportunities and issues. Their organizations are always moving toward the vision, constantly improving, and achieving long-term success.

“A leader is one who knows the way, goes the way, and shows the way.” – John Maxwell

“The very essence of leadership is that you have to have a vision.  It’s got to be a vision you articulate clearly and forcefully on every occasion.  You can’t blow an uncertain trumpet.” – Reverend Theodore Hesburgh

“A true leader has the confidence to stand alone, the courage to make tough decisions, and the compassion to listen to the needs of others.  He does not set out to be a leader, but becomes one by the equality of his actions and the integrity of his intent.”Douglas MacArthur

“Leadership and learning are indispensable to each other.” John F. Kennedy

Leadership Principles – Volume 2

In this week’s post, we discuss the next three of George Marshall‘s Nine Leadership Principles, including:

  • Speaking Your Mind: The Principle of Candor
  • Choosing and Rewarding the Right People: The Principle of Fairness
  • Supporting the Troops: The Principle of Caring

These three principles relate to how leaders communicate with their organization, establish a culture that rewards straight talk and candor, have the right people in place, and finally, take care of those people.

Let’s look at each of these principles and how they may apply to your organization.

Speaking Your Mind: The Principle of Candor
In many organizations, speaking up, straight talk, and candor are frowned upon, even at the highest levels.  While much lip service may be paid to these attributes, the organizations either penalize those individuals that speak up by labeling them as “troublemakers”, or, in the case of bad news, “shoot the messenger”.  These organizations also tend to obscure the information behind “corporate-speak” to avoid having to deal directly with contentious issues, “breathe their own exhaust”, and make decisions that may not be in the best interests of the organization because the culture does not allow debate or dissent.

Effective leaders that apply straight talk and candor, in all of their communications and relationships, create a culture of trust that promotes open discussion and debate, and in fact, rewards it.  As a result, not only are these leaders trusted and credible, their organizations openly share information, are aligned in the same direction, make good, well thought out, decisions, and execute on those decisions.

Choosing and Rewarding the Right People: The Principle of Fairness
There are actually two parts to this principle, which should be considered one of the primary tasks of a leader.  In his book “Good to Great“, Jim Collins calls this “Getting the Right People on the Bus”.

The first is identifying, and recruiting/promoting, the best person for each position and/or assignment based on the requirements of the organization, cultural fit (as applicable), and individual attributes. The element of fairness comes into play when the person is considered and selected on the basis on proven performance and attributes, and not necessarily because they were the “next in line”.

The second part of this principle is that once the right people are place, the leader and organization must actively support their efforts, and reward them with loyalty.

Effective leaders make these decisions, not on popularity, favoritism, or seniority, but on the basis of integrity, performance, judgement, and the ability to speak their mind for the good of the organization.  Having the right people in place improves delegation, organizational decision-making, information flow, and the overall performance of the organization.

Supporting the Troops: The Principle of Caring
Now that you have established an open culture, and have the right people in place, the final principle is to take care of them.

Morale is another key task of a leader, and one that cannot be delegated.  People want to know that their leader,and organization, has their best interests at heart, respects them as individuals and employees, values their efforts, and actively demonstrates that support and concern.  In many instances, it will be the little things that count, and work to demonstrate that support and value.

Effective leaders demand top performance, get out and talk with their people, tell them the truth, listen to their suggestions and concerns, and take action where possible.  Organizations that have good morale, and show respect for their employees will be more successful.

Utilization of these principles requires leaders that have a strong set of personal values, moral courage, and are secure enough to listen to and accept dissent for the overall good of the organization.  Those leaders can apply these principles to establish a high performance culture that speaks candidly, rewards performance, and values and supports each individual leading to the long-term success of the organization.

“Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others.” — Jack Welch

“A real leader faces the music, even when he doesn’t like the tune.” – Anonymous

Leaders who make it a practice to draw out the thoughts and ideas of their subordinates, and who are receptive even to bad news, will be properly informed.  Communicate downward to subordinates with at least the same care and attention as you communicate upward to superiors.” — L. B. Belker

Leadership Principles – Volume 1

This is the first installment of our series on the Nine Leadership Principles followed by George Marshall.  In this post, we’ll focus on three of these principles including:

  • Doing the Right Thing: The Principle of Integrity
  • Mastering the Situation: The Principle of Action
  • Serving the Greater Good: The Principle of Selflessness

Leaders that want to use these principles (and the other six) to guide their actions, and those of their organization, must have self confidence, strong core values, moral courage, and backbone.  If any of these attributes are lacking, these principles will not be effective, leading to uncertainty, confusion, and a lack of trust and credibility throughout the organization, and its outside relationships.

Before deciding to use these principles, however, there are several questions that leaders should ask themselves:

  • Do I have the attributes required to effectively use these principles?
  • What is the message that I want to send to my organization?
  • What is the culture that I want my organization to have?

Let’s look at the first three principles:

Doing the Right Thing: The Principle of Integrity
This is, in my opinion, the most important of the nine principles, both for the leader and his organization.  Without integrity, and the ability to define and do the right thing in any situation, a leader cannot build trust and credibility in his leadership.

Using this principle means using the attributes defined earlier, using integrity to identify the right course of action, and taking full responsibility for that action and outcome, regardless of the consequences.  By doing so, the leader holds himself to a high standard, and sets the expectations for his entire organization.

Mastering the Situation: The Principle of Action
Too many times, leaders and their organizations, put off decisions and action, hoping that the situation will get better, or just go away, with time.  They spend more time on planning, discussing, meeting, and gathering information vs. actually making the decision.  In general, most situations, unlike wine, don’t get better with age, and the consequences are usually far worse by waiting.

Effective leaders are willing to step up and take the right action required in a given situation, even if they don’t have all of the information they would like to have.  They take their best shot based on the information available, and act when necessary.  While mistakes can and will be made from time to time, it is far more important to act rather than sit and wait for something to happen. As the Nike commercial says – “Just Do It!”.

Serving the Greater Good: The Principle of Selflessness
In his book, Good to Great, Jim Collins defines a Level 5 leader as “one who channels their ego needs away form themselves and into the larger goal of building a great organization”.  These leaders direct their energy and ambition to the organization vs. promoting their self interest.

Leaders that use this principle base all of their actions and decision on what is right for the organization as a whole, not how it will affect them personally. They let their actions speak for themselves and look beyond the personal benefit to the long-term interest of the organization.

The leaders that utilize these principles consistently do the right thing, and take action for the good of the organization.  By doing so, they establish the standard and build a culture that follows these same principles over time, resulting in a committed and successful organization.

If you have any comments or questions, or would like more information, please call us at (727) 637-4666, or email me directly at Don@HuttlinAssociates.com.

“The supreme quality of leadership is integrity.” – Dwight Eisenhower

People buy into the leader before they buy into the vision.”  —  John Maxwell

“The art of leadership is saying no, not saying yes. It is very easy to say yes.” — Tony Blair

“A good plan violently executed now is better than a perfect plan executed next week.” –  George Patton

Clear Principles Equal Great Results!

Every week, there are a number of articles and posts on the subject of Leadership that provide thought provoking and useful advice that can be utilized in many organizations.  However, with all of this information available, how does one identify the best practices that can be applied to their own organization?

Truly effective leaders have a set of principles that they utilize to guide their actions and decision making in any situation.  As a result, these leaders generally deliver great, sustainable results, and their organizational cultures reflect those same principles.  In the end, Leadership is judged and “defined by results” (Peter Drucker) that are achieved by the organization.

In 1964, Jack Uldrich wrote a book titled George MarshallSoldier, Statesman, Peacemaker; Lessons in Leadership” that described a set of Nine Principles of Leadership that Marshall used to guide him and his organizations throughout his long and varied career.

The Nine Principles are as follows:

  • Doing the Right Thing: The Principle of Integrity
  • Mastering the Situation: The Principle of Action
  • Serving the Greater Good: The Principle of Selflessness
  • Speaking Your Mind: The Principle of Candor
  • Laying the Groundwork: The Principle of Preparation
  • Sharing Know ledge: The Principle of Learning and Teaching
  • Choosing and Rewarding the Right People: The Principle of Fairness
  • Focusing in the Big Picture: The Principle of Vision
  • Supporting the Troops: The Principle of Caring

Even though this book was written almost 50 years ago, these principles have stood the test of time, are just as valid today as when they were first written, and can be utilized by individual leaders to establish the culture of their organizations.  When you really think about it, every member of an organization can be considered a leader at some level, and can utilize these principles in their daily activities, as well

Also, note that many of these principles have appeared in other management and leadership texts.  While the principles may have a different name, or description, the essence of each one is generally consistent including integrity, action, candor, preparation, and having the right team, among others.  For example, in his book,Good to Great, Jim Collins talks about “Level 5 Leaders, Who then What, Confronting the Brutal Facts, and a Culture of Discipline”.  All can be directly related to Marshall’s principles above.

All organizations have leaders.  However, those organizations that produce sustainable results will have a leader that follows these principles personally, and makes them a part of the organizational culture.  The effective leader cannot pick and choose which principles he will use, it is an all or nothing proposition, and all must be present for success.

The leaders and organizations that choose to utilize and apply these principles will ultimately produce great results, and achieve success.

Over the coming weeks, we will be focusing on these principles in greater detail, with practical applications, and how each one can be applied to your organization to improve and drive overall success.

“Effective leadership is not about making speeches or being liked; leadership is defined by results not attributes.”  – Peter Drucker

“Leadership is the art of getting someone else to do something you want done because he wants to do it.” – Dwight D. Eisenhower

 

Good Leadership = Good Communications

Over the last few weeks, we’ve been discussing the importance of organizational communications.  In our last segment, we’ll focus on Leadership Communications, and sending the right messages to your organization to promote trust, increase engagement and alignment, and improve performance.

One of the key attributes of high performing and successful organizations is the effectiveness of their internal communications.  These leaders share as much information as possible with their teams so that everyone understands the vision, values, direction, performance expectations and standards, and culture.

Effective leadership communications are:

  • Regular and Timely
  • Clear
  • Understandable
  • Open and Transparent
  • Informative
  • Reinforcing

In a Harvard Business Review post, John Baldoni recommended three additional requirements:

  • Courage – Talking straight about what your team wants to hear
  • Innovation – Encouraging creativity and innovative thinking
  • Discipline – Accountability to tell the good and bad news

I’ll add one last requirement to the list – Active Engagement.  A truly effective communication process must be a two way street.  Although you are providing information, you must actively listen to insure that the information and message are clear and understood, and openly solicit team opinions and input to really improve the organization and performance over time.

If any of these elements are missing, then your organization will make assumptions and use rumors to fill in the blanks on their own, increasing the risk of making poor decisions, and will not be engaged, committed, or aligned. Also, if you are not willing to share information, the assumption may be that you are hiding something and the culture will suffer.  Finally, some leaders continue to take the position that sharing information will result in “losing control” of the organization if the team knows too much, or that the shared information will be leaked to the market and competition.

In my experience, leaders that choose to communicate regularly, openly, and actively with their organizations can expect the following results:

 

  • Improved performance
  • High level of engagement and commitment
  • Continuous improvement
  • Motivated team
  • Improved decision making
  • Good organizational culture

As the leader, you can decide now to open up your organizations communications, share information clearly and transparently, and get your team fully involved and committed. The result will be a high performing organization that is capable of accomplishing great things.

Communication is the real work of leadership.” – Nitin Nohria

“Developing excellent communication skills is absolutely essential to effective leadership. The leader must be able to share knowledge and ideas to transmit a sense of urgency and enthusiasm to others. If a leader can’t get a message across clearly and motivate others to act on it, then having a message doesn’t even matter.”  –  Gilbert Amelio, former President and CEO of National Semiconductor Corp

 

What Does Your Customer Want?

In last week’s post, we discussed the importance of an effective communications process to your organization’s success.  The next logical question is –  “How effective are your customer communications?”

Good customer communications are the key to building a solid base, retaining customers for the long term, establishing strong relationships, and making their experience the best it can be.  Organizations that communicate well are generally rewarded with loyal customers, and steady and consistent growth over time.

Most successful organizations generally know and understand what their customers want.  However, in his recent article in Inc. magazine, Geoffrey James listed six attributes that every customer wants, regardless of the organization:

 

  • Preparation –  Doing Your Homework
  • Simplicity –  Making it Simple to do business with you
  • Creativity –  Identifying New Solutions
  • Loyalty – To Their Organization and Requirements
  • Accessibility – Making Them Feel Special
  • Accountability –  Not Passing the Buck

I’ll add two more to his list:

As you look at the list, note that many of these issues revolve around communications in one way or another.  Regardless of the form, all customer communications should meet the following criteria:

  • Clear and Simple
  • Build trust and confidence
  • Emphasize their importance to your organization
  • Demonstrate your understanding of their need
  • Timely

To do this well, however, requires discipline, focus and being proactive.  Too many organizations, however, either don’t understand the importance of this communication, or pay lip service to this process, and don’t make it a priority throughout the organization.  As a result, they are surprised when a customer leaves after feeling ignored, or taken for granted.

In my opinion, there is one final part of the process which is to establish and maintain a regular and consistent dialogue with your key customers.  This dialogue will build strong relationships, trust, loyalty, and credibility as a valued supplier, leading to an increased share of their business, where possible.  In addition, you will want to expand your relationship to as many levels of the customer’s organization as possible to reduce the risk of losing business if your key contact leaves.

By having this regular dialogue, you accomplish several objectives:

  • Build strong, long term relationships
  • Demonstrate your understanding of their business and requirements
  • Promote the value that your organization provides
  • Identify areas for improvement in your performance

Customers are the sole reason for the existence of most organizations.  If you communicate clearly, simply, and timely, throughout your customer’s organization, and make their experience that best it can be, you will be well on your way to having both long term customers, and consistent growth.

“Every contact we have with a customer influences whether or not they’ll come back. We have to be great every time or we’ll lose them.”  – Kevin Stirtz

“Spend a lot of time talking to customers face to face. You’d be amazed how many companies don’t listen to their customers.” – Ross Perot

“A customer is the most important visitor on our premises, he is not dependent on us. We are dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an outsider in our business. He is part of it. We are not doing him a favor by serving him. He is doing us a favor by giving us an opportunity to do so.” – Mahatma Gandhi

 

Is Your Organization Communicating Effectively?

Organizations that communicate clearly and effectively, both internally and externally, are much more successful than those that do not.

Let me give you a simple example of a clear communication process.

For those of you that may not be sailors, or have not watched a sailing match, racing a crewed sailboat properly requires great teamwork, and very clear communication so that each crew member can perform their task in a coordinated way to successfully complete the maneuver.  The captain communicates with the entire crew prior to, and during, each step in the maneuver so all of the crew has the same information, and knows what to do and expect as the maneuver proceeds.

The communication process for a simple tacking maneuver may sound something like this:

  • “Tacking in 2 minutes.”
  • “Ready on the sheets.   Trimmers and grinders into position.”
  • “Ready to tack.”  “Tacking.”
  • “Speed is down – trim the sheet in.”
  • “Speed good – watch the trim.”

As you can see, the captain communicated all of the information his crew needed to do their jobs, kept them informed throughout the process about the status and performance of the boat, and identified where additional action was necessary to stay on course and meet the objective.

This same type of clear communication is necessary for any organization to operate effectively and efficiently, and can take many forms, including verbal, written, formal and informal

In any organization, communications play a key role in the following areas:

  • Motivation, including task information and methods, and performance standards and expectations
  • Source of information for decision-making
  • Molding the culture of the organization, and individual attitudes toward the company and customers
  • Managing and controlling the organization
  • Improving teamwork
  • Establishing strong relationships with outside entities

In the absence of such communication, employees are left in the dark about their performance and that of the organization, overall performance is reduced, the culture is poor, mixed messages are sent, rumors abound, and assumptions are made, generally with bad results.  Clear communication eliminates these issues and promotes a consistent flow of information through the organization to keep it moving in the same direction.

By communicating clearly, the entire organization understands the strategy, direction, expectations, performance requirements, culture, and the message that the organization wants to send to outside entities.  There are generally very few surprises.

Organizations with a good communication process exhibit the following attributes:

  • Strong performance at every level of the organization
  • Clear level of performance expectations and standards
  • Cost efficient
  • Good teamwork
  • Great customer service and relationships
  • Good culture and understanding of direction and requirements

A good communication process includes:

  • Consistency
  • Clarity
  • Understanding
  • Sending a clear message about the vision strategy and direction of the organization
  • Facilitating a smooth flow of information between functions to meet customer expectations and performance objectives

The leader of the organization is ultimately responsible for the communication program, and setting the tone for that process throughout the organization.

“Skill in the art of communication is crucial to a leader’s success. He can accomplish nothing unless he can communicate effectively.”  – Unknown