Yearly Archives: 2015

While I typically focus my articles toward high-ranking profit and loss leaders such as CEOs and line managers, I’d like to take the opportunity to discuss Level 1 leaders for staff departments, including: accounting, human resources, IT support, corporate communications, and legal. Oftentimes, top executives struggle with determining these individuals’ roles and evaluating their contribution, as Level 1 staff members are often seen as costly necessities to the rank and file employees, and have little impact on the company. They can be seen as bureaucrats or policy gatekeepers living off the revenue execution talent of others, and are often known to make business difficult.

Level 1 staff executives are paid sizable salaries and often benefit from large bonuses immune from enterprise performance. They can be seen to have little direct effect on profit, and are not held accountable except by subjective opinion relative to “likeability,” or their relationship with the CEO. Because they lack direct ownership for numerical KPIs, mediocre functional staff chiefs can skate for years without much quantitative accountability. Many are perceived to contribute only as process advisors when a crisis occurs for the line officers and client servers.

In numerous companies, employees have a right in evaluating the functional staff leadership as ‘maintenance personnel,’ in that they do not have the long-term competitive impact to justify their costs. This leadership can have considerable authority, but little quantitative accountability. If their only role is proven to be only functional transactions, the positions would be cheaper being outsourced or even automated.

Despite this, Level 1 functional staff can be the most valuable business leaders in the organization, if they are talented and their position is clearly defined and regulated.

I believe the most successful chief functional leaders […]

You don’t win big without sacrificing your best talent for the interest of the client.
Throughout my career, people have told me, “When your company mobilizes leadership from the top of your organizational hierarchy to win a job, it seems to have an incredible batting average.” Over the years, I’ve given a lot of thought to this comment, considering it’s been conveyed both inside and outside my company. Perhaps the reason I have given it so much thought is because it consistently rings true. Throughout my career, we have watched ourselves and competitors win and lose mega-jobs and have learned from the experiences.

We have found that when a company really wants to focus on winning a large project, it is forced to make difficult leadership decisions. It requires a company culture that believes the client’s largest project is equally as important as the enterprise management. The most common prerequisite of winning a mega-job is re-assigning senior talent (often Level 1 or group/division presidents) to lead a project for up to several years.

Of course, when a company does this, the enterprise leadership is disrupted with the need to replace that executive while they are gone; however, very few firms have the courage and culture to do this. Companies rationalize that the leader is irreplaceable (which, in my opinion, is not true) and that removing them from their position would be too disruptive to the organization. Rarely does an executive volunteer, leaving it up to the company to make the decision. But in my experience, when a company truly wants to win a large project, it will find a way to provide the client with one of their most senior executives for the entire duration of the […]

The secrets to the best solutions are found where the greatest challenges of the world exist.

When our U.S. based company first contemplated global expansion strategy in the early 1990s, there stemmed an appropriate internal challenge from the senior management team as to why. The U.S. market was very large and profitable. At the time, we held a >5% overall market share of our water sector and the market was growing. Globalization seemed, to some, a difficult diversion to a proven domestic approach. The management challenges of differing currencies, cultures, contract styles and languages, in addition to the issue of management time required, seemed like a tall order. There was no indication that a non-U.S. market had any advantages in profitability, but certainly would add disproportionately to corporate overhead. We were inexperienced in transcontinental travel—we knew it and were not kidding ourselves—and we were unsure of the time dedication it would require of a few of us. So why?

The major reason for globalization was rooted in the conviction that the best technologies in the world are found at the location of most severe challenge. These challenges were often not located in the U.S. If we were a technology company, how could we detect and learn the best technologies without an international presence? For instance, the best dredging and pumping technology in the world resided in the Netherlands. The best desalinization technology existed in Arab countries and other places of severe drought. The best dam and reservoir technology was found in emerging countries harnessing large rivers for energy.

At that time, computer science was elementary and email was just evolving. Software compatibility was problematic and equipment costs were very high. There was no satellite or high-speed cable lines […]