Making Excellence The Habit

We are what we repeatedly do. Excellence is not an act, but a habit …Aristotle

The CEO, leader, founder, whatever the name, it’s the boss who is the core value of the company, the head of the company.  They influence the culture and performance of the company both consciously and sometimes unconsciously. His or her actions, responses, and rules dictate the way people approach problems, their own work, and other employees.

When the boss creates a positive, constructive and high-performing culture, people are more engaged, more productive and deliver far better outcomes.

A fish rots from the head down

The Turks have a homely proverb: they say “the fish stinks first at the head”, meaning, that if the servant is disorderly, it is because the master is so.

The proverb isn’t a lesson in piscine biology. The phrase used in Turkey in a metaphorical rather than literal sense from the outset. In reality, it is the guts of fish that rot and stink before the head!

Nonetheless, the biologically inaccurate proverb holds so true in many aspects of life and none more so than the world of business.

When an organisation fails, it is the leadership that is the root cause

• If the culture is broken, only leadership can fix it. If the leadership culture itself is unhealthy, there begins the rot.
• If the strategy or direction is broken, only leadership has the power to decide and to change it.
• If the organisation doesn’t execute, only leadership can demand and ensure that the organisation does the work. Leadership sets and keeps the standards.
• If a company is failing because they have the wrong people in place, it’s leadership that allows the wrong people stay.
• Only leadership has the power to make those changes, even if they need the support of their entire team to execute them.

Never has this been so well demonstrated than in some very highly visible public demises of bosses and even organisations.

Banking Royal Commission

No bank escaped with a glowing assessment, but one of Australia’s “big four” was singled out during the hearings. NAB received a special mention, purely because of a very public display of appalling leadership.

The Commissioner stated “NAB also stands apart from the other three major banks … Having heard from both the CEO, and the Chair, I am not as confident as I would wish to be that the lessons of the past have been learned … More particularly, I was not persuaded that NAB is willing to accept the necessary responsibility for deciding, for itself, what is the right thing to do and having its staff act accordingly.” In his final report, Commissioner Hayne went on to say that the Chair seemed unwilling to accept criticism of how the board had dealt with some of the issues raised by the commission.

It is no surprise that neither the CEO or Chair survived in their roles. Neither is it a surprise that the culture these leaders created led to such unacceptable practices throughout the bank, which are still making headlines today – for all the wrong reasons.

Corporate Fraud – led from the top

Enron, at the time of its demise, was one of America’s largest corporations, and its closure affected the lives of 22,000 employees. Soon after making $111 billion in revenues in 2000 it transpired that company leadership had used off-the-books accounting to overstate profits and hide its debts. When analysts became suspicious, shares dropped, going from a peak of $90.75 in August 2000 to just $0.67 in 2002. Enron is now only remembered as a symbol of corporate corruption and fraud.

WorldCom was the second biggest long-distance phone company in the US – nowadays, it’s synonymous with one of the biggest accounting fraud cases in US history. Despite the appearance of impressive growth throughout the 1990s, with the company purchasing MCI Communications in 1998, it transpired that CEO Bernie Ebbers had cooked the books. An audit uncovered a staggering $3.8 billion in fraud between 1999 and the first quarter of 2002. In July 2002, WorldCom filed for bankruptcy, then in July 2005 Ebbers was sentenced to 25 years in prison for the fraud.

Great leadership delivers great outcomes

Serious leaders understand that, both by design and default, they’re always leading by example. Everyone senses their success — and failure. Leading by example is integral to their “leadership brand.”

Sir Richard Branson brings together business and art and life. His entrepreneurial passion renders the Virgin brand a worldwide phenomenon. His joie de vivre is an infectious inspiration. Branson’s mantra: “Screw it, just do it!” encapsulates a universal can-do spirit of action and performance that pervades the businesses he leads.

Bill Gates contributions go well beyond helping set off the creative destruction of the Information Age—though, that alone is a spectacular achievement. He has moved his numbers-driven approach into the not-for-profit sphere, where, along with his wife Melinda, he is triggering additional, overdue, disruptive change.

Tony Hsieh is an American internet entrepreneur and venture capitalist. He is the CEO of the online shoe and clothing company Zappos and personally has a singular focus on customer service. Hsieh hopes that, down the road, Zappos will be remembered as the best customer service and customer experience company. Zappos has been successful in providing the best customer service and consistently being one of the best places to work. There are dozens of stories about their outstanding customer service, so it should come as no surprise that 75% of Zappos orders are from repeat customers.

 “Our number one priority is company culture. Our whole belief is that if you get the culture right, most of the other stuff like delivering great customer service or building a long-term enduring brand will just happen naturally on its own.” Says Hseih

Make Excellence Your Habit

All leaders need to have the 4 key success factors in place to effectively deliver excellent outcomes.

1. Vision and Strategic Plan

Many businesses don’t have a well-articulated vision or strategic plan, with clear goals and milestones. This results in a lack of direction in decision making and a failure to effectively drive and manage performance.

2. People and Culture

It’s never been more important to attract and retain the best people in your business to perform consistently well. The people and skills to lead the second growth phase are very different than those required in a start-up. Many CEOs struggle with the transition of bringing in fresh talent whilst also honouring (and retaining) loyal employees.

3. Governance and Leadership

In a start-up, the founders can successfully grow the business through hands-on management, often micro-management. As a business scales, this style no longer works. The optimum level of governance and right style of leadership must be used to lead growth and manage risks.

4. Systems and Processes

The systems, tools and processes in start-up are quite rightly basic, often in the founders head or written on the back of an envelope. This makes for nimble and cost-effective growth when starting out. Scaling up demands a different level of rigour and sophistication as systems and software across the business become increasingly vital to compete profitably and avoid costly errors.

Contact Jayne today for help in making Excellence YOUR Habit