A major flaw of many organizations is that they operate within a single communication structure. At the top are the C people: Chief This, Chief That, etc. Middle management appears (as the term suggests) in the middle, and the foot soldiers are at the bottom. This structure is known as a hierarchy and is commonly represented by the boxes and lines of an organization chart.

Hierarchies are appropriate when information must flow from the top of an organization to the bottom. Their flaw is that hierarchies are one way streets that keep information from flowing in other directions. Let’s take a look.

A good example of a hierarchy is a football team playing a game. During the game a play is sent from the “C” people (the coaches) to the quarterback. The quarterback fulfills the role of middle management by relaying the play to his teammates (the foot soldiers), each of whom has a specific assignment. If the players do what they are told, the right way, something desirable happens.

But it takes more to win than doing things right. Consider that there are 2800 players in the NFL during pre-season. These players are the best in the world at what they do. Even so, by the time the season starts the number of NFL players is reduced to 1700. Everybody who plays in a regular season NFL game can do things right.

What separates the winners from losers is knowing the right things to do. That’s why the C-people (the coaches) set hierarchal structure aside during the week(s) before a game.

Before a game coaches seek information from players who once played for the opponent. Statistical scouting reports are picked-over in hopes of revealing traits and trends. Film is reviewed. Weather conditions are monitored, etc. Coaches must create winning game plans to be successful, and that means having a way to communicate with as many credible sources as possible.

Of necessity a plan (for a game or anything else) must be rigidly defined and clearly articulated. But plan creation is different. Plan creation requires flexibility and openness to react to the competition. When an organization is creating a plan, the top to bottom one way nature of a hierarchy is inappropriate because hierarchal structures are rigid, and by definition, rigid structures can’t react.

Plan creation demands a framework that stimulates the free flow of information, regardless of hierarchical structure. There is such a framework. We call it Broadcasting — the communications framework that assures information at any level, from any source both within and outside an organization, can flow directly to where it is most needed.

We have many personal business experiences working with Broadcasting. We chose the following because the brand is exceptionally well known, enjoys a wide market segment reach, and clearly exemplifies Broadcasting.

For years the Scott’s company was mired in third-place behind Dow Chemical and Sears Roebuck in the sale of seed and fertilizer to commercial farmers. Scott’s remained in third-place regardless of their many attempts to promote the product.

Scott’s product was good. In fact Scott’s offered a 99.91% weed free seed. However it cost more than the competition and Scott’s was having difficulty convincing farmers that fewer weeds was worth the high price. Scott’s leadership questioned, “Can we lower the price?” They asked, “How do we make the product better?” Those questions didn’t solve the problem.

The facts are a little sketchy, but supposedly a Scott’s sales rep was made aware of what led to Scott’s ascent by a farmer who had recently returned from his fields. The rep, who had repeatedly failed to sell what was a demonstrably superior product, turned to the farmer and out of frustration asked, “What is it about our product you don’t like?”

The farmer replied, “It’s not the product. My problem is I need a better way to spread seed and fertilizer.” At that moment the rep realized that getting the sale was about product application, not product performance. After all, the product was already known to perform better than the competition.

The rep realized he had to interrupt Scott’s hierarchy and convince Scott’s leadership to seek a solution to the application problem. Scott’s rep had to be allowed to influence the decision making process. And thankfully for Scott’s, he was!

Scott’s purchased and promulgated the use of commercial seed and fertilizer spreaders. That single action redefined Scott’s in their customer’s minds. As a result, Scott’s became the spreader company that sells superior seed and fertilizer, not just another seed and fertilizer company.

Agricultural operations have spreading needs other than seed and fertilizer, so when the question of spreading anything arose, Scott’s got the call. Today Scott’s is a leading producer and marketer of not only seeds and fertilizers, but also herbicides and pesticides.

Scott’s subsequently introduced the first home lawn spreader. After all, every homeowner shares the same need as farmers – to spread seed and fertilizer. Today, with its Turf Builder and other high quality brands, Scott’s owns just over half of the do-it-yourself lawn care market.

Here are some of Broadcasting’s tenets as illustrated by the Scott’s story.

Never present a problem as a question. Present a problem(s) as a situation to be changed. When Scott’s leadership asked — “How do we make the product better?” — they unwittingly directed their focus on the product, and the product wasn’t the problem. The danger in asking a question is it presumes the question is correct. When the question is not correct, you get an answer, but you don’t solve the problem. Lower cost and better product were not the farmer’s problems.

Knowledge has the right to judgment. The quality of any decision is enhanced when those with the most pertinent knowledge about the subject being decided participate in the decision making process. Broadcasting ensured that the Scott’s rep got to sit at the decision making table.

The person with the problem has the freedom to communicate directly with the person with the answer. Departmental boundaries don’t exist in a Broadcasting environment because it is impossible to know where individuals with the most pertinent knowledge exist. Indeed those individuals may only exist outside of the organization. Scott’s solution came from a farmer in a field, not from within Scott’s.

The role of a leader is not to make decisions, but to monitor the decision making process. Within a Broadcasting environment a leader isn’t a player, he or she is a referee tasked with ensuring that the person(s) with the greatest insight of the subject at hand has access to the person(s) with the problem. The revelation that Scott’s would sell seed not by making the seed cheaper or better, but by making the application easier, literally came from the ground up. A farmer in a field, told a Scott’s rep, who told Scott’s leadership. That’s the power of Broadcasting!

It’s clear that luck sometimes plays a role in success. But luck can’t be planned. It’s also clear that success requires the talent to do things right. But success requires a measure of talent beyond an ability to do things right. Success requires the talent to discover the right thing(s) to do. Successful companies posses this talent in great measure and make the ultimate case for Broadcasting.

Hut, Hut … Hut
October 24, 2012 by Bob Manna & Matt Manna
Version: 79DD1EE9(R04) • Feb 16, 2014
Photo © Mary Knudson – Fotolia.com

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Building an organization is not rocket science, but it’s also not a piece of cake. It begins by determining and acquiring essential resources.

Interestingly, when one examines the resources of an organization, any organization, all organizations, and reduces those resources down to their fundamental irreducible parts, it becomes evident that an organization has only three resources: time, money, and talent. In the final analysis, the successful pursuit of any desired outcome is dependent upon time, money, and talent.

Time is abundant and given to us free of charge. We don’t have to search for it because it’s what we have as a result of being alive. Of course what we do with “our time” is up to us.

Money is slightly more scarce than time, but not by much. Money at rest is money in decline, an untenable predicament. All that an organization must do to receive money is to convince an investor the money will be returned. The only way an organization can make that argument is demonstrate it has the third and scarcest resource — talent.

Talent is an autonomous measure of natural ability. It exists independently of character, intelligence, and discipline. That’s not to say character, intelligence, and discipline are unimportant. They are important. But character, intelligence, and discipline are not proxies for talent and they will not lead to talent’s creation; although they occasionally lead to the discovery and development of talent.

We have all heard that anything is achievable so long as one works at it long enough. The idea that talent inevitably flows from the intelligent, disciplined effort of persons with enough character to work at it, is absolutely wrong. It is common for highly intelligent, rigidly disciplined persons to produce results not much different from those whose efforts are sparse by comparison. The reason is that knowledge afforded by effort is not interchangeable with talent. This disconcerting truth is easier to grasp when presented in familiar terms.

Imagine a nascent wanna-be Nolan Ryan looking for a book, course of study, or list of instructions entitled, How To Throw A 100 Mile An Hour Fastball. In business these kinds of things might take the forms of case studies or “How To” sales and management books.

The idea that the next Nolan Ryan could be produced by studying a book is comical. Everyone who has ever thrown a baseball knows you either have the talent to throw hard or you don’t. It doesn’t matter how much knowledge you accumulate, or how much you throw, without talent you will never throw a 100 mile an hour fastball — end of story!

This doesn’t mean everyone capable of throwing hard will develop the ability to throw a 100 mile an hour fastball. It usually takes development to turn raw talent into top performance. What it does mean is that no amount of coaching or training will turn an untalented individual into the next Nolan Ryan. You might get to the majors based on other pitching skills, but no amount of coaching or training is going to make you the next Nolan Ryan if you don’t have the talent to throw hard.

Organizational success is no different. In order to succeed an organization must posses the requisite talent. Stated plainly, an organization deficient in talent should no more anticipate success than an individual who is unable to throw hard should expect to become the next Nolan Ryan.

Nothing speaks more certainly about an organization’s potential for success than recognition of talent as the scarcest of all resources and management of talent as the scarcest of all organizational skills. Talent, and the environment in which it is managed, define the nature and nurture of all organizations. While it is possible to identify and analyze these elements, it is wrong to assume that such knowledge will provide a means to their inheritance.

Talent
May 14, 2012 by Bob Manna & Matt Manna
Version: 0055BC4B(R05) • Jan 24, 2014
Photo © SM Web – Fotolia.com

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Basing future expectations on past performance is silly. Why? Because the future is a certainty but what will happen in the future is not.

Every basketball fan who has watched their favorite player score 18 points in the first quarter of a game, only to wind up with a total of 23 points at the end, has a visceral understanding of how much the future can differ from the past.

In business, as in basketball, it’s tempting to believe the future is best evaluated through analysis of data representing the past. That’s not usually the case, and to believe otherwise is dangerous.

The word that most exemplifies the danger is projection. There is another similar sounding word often equated with projection. That word is prediction. But projection and prediction do not refer to the same talent. In fact there is a vast difference between them. Let’s take a look.

Suppose you’re in control of an established luxury car company with steady but stagnant sales. Research indicates that cars above a particular price point sell in quantity X. Below the price point, X+ number of cars sell. You decide to go for the X+ price point.

Because of your mathematical adroitness you “know” the increased number of cars sold will make enough real profit dollars to compensate for the projected decrease in profit margin.

Perhaps your company builds a less expensive car, one that keeps costs in line with the current profit margin and provides the magical X+ units sold price point. Either way the projection path seems clear. Offer an inexpensive luxury car and you’re on the road to good times.

It won’t happen. In fact it didn’t happen — just ask Jaguar. Why? Because luxury car customers are motivated by their convictions, and “luxury” is a conviction that cannot be connected to a low price.

The talent to identify the basic and invariable meaning of a conviction (a luxury car requires a luxury price) is the difference between projection and prediction. A projection is an estimate of future behavior based upon a statistical analysis of past behavior. A prediction is a statement of unrecognized but possible future behavior, based on the identification of convictions. (…)

Identifying convictions is a difficult task. It’s often much harder to do than it is to develop a product, service, candidate, or cause. One reason identifying convictions is hard is because convictions occasionally change. (…)

Suppose you’re the owner of a specialty picture frame store. Research confirms an increase in the number of pictures taken due to the proliferation of digital cameras. Also, a decrease in the cost of making prints, and the ease of transmitting digital photographs, has (as projected) increased the number of shared photographs.

Yea, it’s good times ahead! If X specialty frames were sold before the digital era, then X+ will be sold after. Wrong! The conviction that tickles a customer’s “special” gene changes when pictures are taken as easily as breathing, and shared as plainly as pushing a button.

Digital photography has changed the basic and invariable meaning (the conviction) a photograph represents. Digital photographs require “digital frames” — a method of display that is readily available for use and re-use as required.

To be sure, there are still photographs recognized as something distinct and permanent in comparison to others. But the environment in which photographs are taken and shared has changed, and that means the basic and invariable conviction of “framing” a photograph has changed. In the digital era most photographs aren’t framed, they’re displayed.

Prediction demands recognition that, (1) success is determined by customer behavior and, (2) customer behavior is based on the basic and invariable meaning of convictions, not mathematics.

In the case of luxury cars, that means a price that supports a luxurious story. In the case of picture frames, that means parlaying with the era of digital photography.

Author’s note: Ron White is a funny and famous comedian that does a bit on the difference between an antidote and an anecdote.

“If I knew the difference between an antidote and an anecdote my camping buddy would be alive today.” —Ron White

The idea for this column came from White’s bit. Confusing similar sounding words with very different meanings is funny when presented in a comedic environment. In the business world it’s lethal.

Projection vs. Prediction
August 28, 2011 by Bob Manna & Matt Manna
Version: 00560503(R03) • Feb 19, 2014
Photo © lucadp – Fotolia.com

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