Nov
09

Renewable Leadership in a Disposable World

by  Tristan Bishop  |  Change Management

“How many quarters in a dollar, daddy?”
My daughter looked up from her math homework, wondering why it had taken me so long to answer. It was the last weekend of the fiscal quarter and my mind had wandered to Wall Street. I carried our overflowing recycling bin toward the garage and answered, “Four, honey.” As I set the sea of empty plastic by the curb, I wondered if I’d heard her correctly: Did she just ask, “How many dollars in a quarter?” My mind raced. Disposable bottles. Quarters in a dollar? Dollars in a Quarter? Suddenly, I saw the connection.

In recent years, leaders have grown so concerned with the number of dollars in a fiscal quarter, that entire organizations have become DISPOSABLE!

The way I see it, there are four primary entities in any public company: The C-suite, the employees, the customers and the shareholders. It is the relationship between these entities that defines whether a business remains Renewable or becomes Disposable.

Disposable Leadership

When leadership has a disposable mindset:

  1. Each entity believes they compete with the others for a share of a finite resource pool.
  2. Each entity seeks to siphon value from the others until replacements are needed.
  3. The culture is fixated on short-term results and burnout leads to attrition.

When thought-leaders have a Disposable mindset, they encourage peers within their entity to take as much as possible from the others. In the Disposable enterprise:

  • C-Suites hire the minimum possible number of employees and drive them at unsustainable levels.
  • Employees give customers half-hearted service, while audaciously cross-selling additional products.
  • Customers are charged the highest possible price and made to pay extra for courteous support.
  • Shareholders push the C-Suite to maximize Quarterly dividends at the expense of R&D.

Renewable Leadership

When leadership has a renewable mindset:

  1. Each entity believes cooperation increases the overall resource pool.
  2. Each entity willingly serves the needs of the others.
  3. The culture is focussed on long-term objectives, increasing retention.

Thought-leaders with a Renewable mindset know that partnership is the path to prosperity. In the Renewable enterprise:

  • C-suites serve employees by maintaining reasonable staff levels and clearly communicating long-term vision.
  • Employees serve customers by working to make every touch-point into a positive experience.
  • Customers serve stockholders by coming back for more, year after year.
  • Stockholders serve the C-suite by refusing to base their job security solely on last quarter’s results.

Retention, Profit and the Future

There is a correlation between Renewable thought-leadership and entity retention. And, due to the high cost of attrition, retention is a primary component of profitability. Disposable leadership only drives key contributors away. Here are a few thoughts on the costs of attrition for each internal entity:

  1. C-Suite: Evidence suggests that key investors follow departing executives to their new companies.
  2. Employees: Replacing a manager costs an average of 2.5 times their annual salary!
  3. Customers: It costs six times more to acquire a new customer than to retain an existing one.

With disposable businesses disintegrating daily, it’s time for character-based leaders to bring renewable thinking into each entity. So what actions should we take to encourage renewable thinking? What are a few ways each entity can drive out disposable thinking? What is one thing you can do to lead change in this area?

About The Author

Articles By tristan-bishop
Full Bio Coming Soon

What People Are Saying

William Powell  |  09 Nov 2010  |  Reply

Loved the post Tristan! I think you have touched on a very important issue here. The main difference between these two scenarios is where the focus lies. In the disposable model, it’s all about being selfish and a protectionist and has all the nuances of an “us/them” culture. We’ve seen enough of that.

The renewable model is about collaboration and cooperation. Working towards a common goal and leverage the strengths of the collective group to overcome the weakness of the individual. Great culture! It’s been shown over and over that this model is the most effective, yet it still remains the minority among businesses. The greater the need, the greater the opportunity for us to be the solution.

Thanks for pointing out such an important dynamic in business!

Cheers,
William

Tristan Bishop  |  09 Nov 2010  |  Reply

Thank you, William!

Great description! I’m so excited to watch 21st century business grow from the us/them divide into collaborative cultures.

It’s going to take great Leadership Advisors, like yourself, to move the reluctant forward!

Appreciating you,

Tristan

Kate Nasser, The People-Skills Coach  |  09 Nov 2010  |  Reply

Tristan,
This is a very thought provoking and thought filled post! I think you are right in assessing what differentiates between disposable or renewable leadership. I think the most telling point is getting shareholders/boards to focus on long term vs. last quarter. And not just in one company!

The challenge is that most or all public companies seem to be focused on the “last quarter”. Thus, if one company in any industry tries to step out and change the focus to long term — it might get trampled by investors abandoning to go to the companies that still focus on immediate gratification.

There are companies who have laughed in the face of tradition and rewrote the book in terms of other trends (e.g. customer service at Nordstrom’s etc…). Yet one contact told me that even in those companies — the primary focus is quarterly performance and profits.

I believe the companies in this global economy would be better off if they took your advice. The question is: Who will be first to stand out? And is greed and impatience at the root of the trouble?

Love your post and I will RT it on Twitter.
Many thanks,
Kate Nasser

Tristan Bishop  |  09 Nov 2010  |  Reply

Hi Kate,

I’m grateful for your kind endorsement and generous support!

To answer your question about the root cause of disposable leadership, I believe it may be that “ownership” means different things to different people. For a day-trader, there is no emotional “ownership” in a company, just a short-term objective to use the stock as a profit generation tool. This person isn’t necessarily greedy or impatient, but isn’t really an “owner” either. But for the CEO of a third-generation family business, built from the ground up, “ownership” means something else entirely.

I don’t expect quarterly performance and profits to fall out of focus. They are certanily not optional, and you’re right about the risk in taking renewable steps. But there are brands that are exploring “collaborative culture” (William’s words) and still enjoying high NPS scores and strong profits. Hopefully, the upward trend continues!

Thanks again, Kate. Have an awesome day!

Tristan

Julio Vazquez  |  09 Nov 2010  |  Reply

Quite a telling post. The trend towards disposable leadership started in the 80s and grew at a rapid clip. The trend came to a hed in 2000, when there appears to have been a wholesale lack of concern for the long-term picture and the focus became maximizing the returns each quarter. This attitued also leads to less focus on the technilogical nurturing needed for true innovation. Overall, the result is in a country that no longer competes successfully. Will we find our way back to “renewable” leadership? I think so, but it will take pushing from below to get that to happen.

Tristan Bishop  |  09 Nov 2010  |  Reply

Thanks for your response, Julio!

One of the ways the Lead Change Group has helped me most has been by teaching me new ways to lead via influence, when I don’t have authority or position. (See William’s post for more of that: http://leadchangegroup.com/frameless-leadership/)

As social media continues to give everyone a voice, we will see an increase of influence at the expense of conventional “command and control” structure. Perhaps that will bring push that you mention.

Have a terrific day!

Tristan

Larry Kunz  |  09 Nov 2010  |  Reply

This is great, Tristan. You’ve touched on one of the biggest problems in business today, and you’ve clearly articulated the solution to the problem.

To answer your question: I’m not sure what I can do, down here in the employee rank-and-file, to effect the kind of change you’re talking about. Maybe I can start, though, by adjusting my attitude: I can get a bigger piece of the pie by making everyone else’s piece smaller. Or I can work with them to make the whole pie bigger. The second course is the one that ultimately leads to success.

Tristan Bishop  |  09 Nov 2010  |  Reply

Thank you for the affirming words, Larry.

I believe that renewable leadership can begin in any entity. In the renewable organization, “Employees serve customers” and drive to ensure that each interaction is positive. As members of the employ entity, our role in leading change is to provide spectacular customer service, rich with kindness and respect. Our attitudes will be “noticed” by management and “felt” by customers. Courtesy is contagious.

An enterprise’s attitude can be adjusted from anywhere. Someone has to go first. Why not me? Why not us?

Mike Henry  |  09 Nov 2010  | 

I agree with Tristan, Larry. Everyone wants to be a part of a winning organization. A key part of that is finding a way to deliver excellent customer service (and peer service for many employees) within the confines of a less-than-perfect organization. But when you do, many times good things start to happen.

You’ll never know if you work for a dud of a company or a soon-to-be great organization until you’ve given your best effort.

Mike…

Tristan Bishop  |  09 Nov 2010  | 

Delighted that Larry and Mike are meeting, here, right on this blog page!

Mike – My core field is Technical Communications and Larry is an admired consultant among us, not to mention highly decorated (http://www.stc.org/PDF_Files/larry-kunz-presidents-award.pdf)

Larry – By founding the Lead Change Group, Mike has called together a phenomenal team of character-based leaders. I have learned so much from them all already.

I say we each do what we can, wherever we are, and see if sparks become flame. I truly believe one can lead change from who they are, wherever they sit.

Alan Berkson  |  09 Nov 2010  |  Reply

Tristan,

I enjoyed your post. I particularly liked your description of the genesis of the idea — that’s generally how my brain works. :-)

I think many of us have pondered this but you put it together so neatly. It’s really about a scarcity vs. abundance mentality, isn’t it?

Thanks!
Alan Berkson

Tristan Bishop  |  09 Nov 2010  |  Reply

Thank you Alan,

I think you hit the nail on the head. As I looked it over, I found this quote from Covey that I LOVE: “The more principle-centered we become, the more we develop an abundance mentality, the more we are genuinely happy for the successes, well-being, achievements, recognition, and good fortune of other people.”

I think you are making some great connections here. As I think about your comment and Covey’s writings, I get yet another conclusion:

Principle-centered leaders are essential for building Renewable cultures.

Thanks so much!

Tristan

Lori Meyer  |  09 Nov 2010  |  Reply

What an awesome post, that so directly and eloquently addresses a crucial issue affecting all of us: the consequences of a narrow, shortsighted, and scarcity-driven approach to leadership. The scarcity principle, sadly, is an all too common foundation of decision-making…the idea that there is only so much to go around, so let’s grab ours before it’s all gone. As far as those who came to the trough too late…well, if there’s nothing left, that’s their problem. In reality, though, it is ALL of our problem, because thinking in terms of what there is NOT enough of can blind us to what there is MUCH of in our organizations…MUCH talent, MUCH energy, MUCH innovation, and MUCH vision for both profitability and a better world.

Thank you for reminding us of the possibilities that we, and our customers, can realize by moving out of the shadows of scarcity thinking.

Tristan Bishop  |  09 Nov 2010  |  Reply

Thank you, Lori!

I know that you are an abundance thinker. I too believe we can begin driving Renewable principles into our environment today. I think you said it beautifully in September, when you wrote:

“Some day, this economic wreckage will be behind us. But we don’t have to wait until that day comes to be a strong force, together, for continuing to build”

I am honored by your encouragement and appreciate your “can do” spirit!

Tristan

Shelly Kramer  |  09 Nov 2010  |  Reply

Tristan,

What an excellent post! And I agree wholeheartedly. Please do yourself a favor and read the book I’m reading right now. It’s called The Mesh, by Lisa Gansky. It might just change your life. I know it is changing mine.

Kudos to you and welcome to the limb. It’s beautiful out here, no? Now, where’s the you-know-what that you promised to bring? Or was that me?

Great job!

Shelly
@shellykramer
http://v3im.com

Tristan Bishop  |  03 Dec 2010  |  Reply

Hi Shelly,

Your encouragement was a crucial part of shaping this vision. I simply can’t thank you enough. And I’ve taken your advice and started reading “The Mesh” this morning.

This limb is lovely, and I’ve got chocolate. The future includes much sharing.

Tristan

Senen Perfecto  |  09 Nov 2010  |  Reply

Excellent presentation and great advice, Tristan!

Please know that your sharing reaches as far as a third-world country such as mine; ours is a very real disposable world direly in need of renewable leadership.

Your sharing and those of all contributors in the Lead Change community help me and other change agents in the Philippines.

Keep making waves!

Tristan Bishop  |  09 Nov 2010  |  Reply

Salamat, Senen! I appreciate your positive words and for giving me that perspective!

Your culture is dear to me. In my younger days, I was privileged to create music with the group Kai. (http://www.amazon.com/Kai/dp/B000007Q6W). They taught me a great deal and the lessons are still with me.

Keep leading change!

Tristan

HeatherEColeman  |  09 Nov 2010  |  Reply

Tristan,
Well done, just love this. I’m going to be posting this on FB and my LI groups as well. Excellent – which isn’t surprising, coming from you!

Heather

Tristan Bishop  |  09 Nov 2010  |  Reply

You’re very kind, Heather! Thank you.

I care, I try – results vary! :) I’m glad this offering was helpful for you and yours!

Thanks for leading change, leading swag and all of your positivity!

Tristan

Susan Mazza  |  10 Nov 2010  |  Reply

Incredibly thought provoking. And I love the way you set up the conversation. You write elegantly Tristan!

To Alan’s point, you do paint a picture of a shift in context from scarcity to abundance. I think one of the key culprits here is what we measure – Tim Hurson calls it the tyranny of shareholder value. What we measure drives thinking and behavior. Daniel Pink in Drive talks about a new kind of entity – instead of only “for profit” and “not for profit”, he introduces a new kind of entity “organized for benefit”.

Will we really be able to make the shift you speak of given the current construct, or do we need to start playing a new game of sorts that expands it’s purpose and hence what is measured and valued?

Tristan Bishop  |  10 Nov 2010  |  Reply

Thank you for your gracious words, Susan!

I think that, in some organizations, thought leaders within each entity can begin serving the other entities. This alone could spark an organic culture adjustment. Big picture, I think the marketplace itself will actually cause a shift in the construct. I believe that renewable leadership will increasingly drive retention, retention will drive profitability and profitability will keep the renewable businesses around longer than disposable ones.

Slowly but surely, the disposable will die out. If you look at the NPS and ENPS trends for disposable organizations, their days seem numbered.

I remain hopeful.

Tristan

Jane Perdue  |  15 Nov 2010  |  Reply

Tristan — what a great column, and what a great topic this would be for high potential leaders destined for the CEO seat: what do I value most — dollars or people? Are people simply a means to a disposable end, or are they a vital resource for renewable/sustainable ends? Coupling Wall Street’s short-term quarter-to-quarter focus with shareholder’s demands and media scrutiny, business focus has shifted from long-term to short-term. As such, decisions are made with just increasing the stock price and bottom-line in mind. Renewable costs more than disposable, so until businesses and Wall Street analysts change what they measure we’re likely to see more of the same…until we hook them with your enlightened views!

Tristan Bishop  |  15 Nov 2010  |  Reply

Thank you so much, Jane!

As always, I highly value your perspective. I have hope that a natural shift will occur, beginning with individuals leading change within their entities. And perhaps the market will continue to reward those companies that take the long view?

Either way, we’re in for an exciting ride.

Tristan

Jen Reyna  |  08 Dec 2010  |  Reply

Tristan – I loved this post. I think it is important to remember that the entire business entity has a common goal – to SUSTAIN. If you are competing with your own stakeholders, instead of working to help each other achieve mutual goals, sustainability becomes nearly impossible. You painted an important and thoughtful picture here.

Tristan Bishop  |  10 Dec 2010  |  Reply

Thanks so much for your input, Jen!

It’s so true: A brand divided against itself can not stand! Only those orgs that strive to exchange value with consumers (rather than extract value FROM them) achieve true renewability.

Tristan

Chris Almond  |  04 Jan 2011  |  Reply

Tristan, this is very much worth sharing (which I am). Thank you!

Tristan Bishop  |  06 Jan 2011  |  Reply

Many thanks, Chris!

I’m honored that you found it useful and look forward to getting to know you and your thoughts as well.

Tristan

Join The Conversation