Want to succeed? Avoid these 9 traps

Posted on October 12, 2007 Updated on June 6, 2015

Want to succeed? Avoid these 9 traps

Robert J Herbold

Success leads to the damaging behaviors of a lack of urgency, a proud and protective attitude, and entitlement thinking. This leads to the tendency to institutionalize legacy thinking and practices. Essentially, you believe that what enabled you to become successful will enable you to be successful forever.

After reviewing this problem in many companies, I believe there are nine dangerous traps into which successful people and organizations often stumble.

Trap 1: NEGLECT
Sticking with Yesterday’s Business Model

By business model, I mean what you do and how you do it. It includes such issues as deciding what industry you will be competing in and what approaches you will use in carrying out all the processes necessary to compete in that industry. Will we manufacture something or contract it out? How will we sell our products or services?

Do we go through retail channels? How should we organize our sales force? Which segments of the industry do we want to ignore, and which do we want to compete in? What is the structure of our support staff? Which parts of the organization do we out source? What are our approaches to distribution and inventory management? What are the cost targets of the various components of the organization, like information technology costs and human resources costs? Does our model leave us satisfied with our gross margins, profit margins, and other such figures?

Organizations should be consistently reviewing all aspects of their business model, looking for areas that are weak and need to be overhauled. By weak, we mean out of date, too costly, too slow, or not flexible. In which areas of the business model are you at parity? In those areas, are there any bright ideas on how to achieve a competitive advantage?

TRAP 2: PRIDE
Allowing Your Products to Become Outdated

You may be super proud of your product or service today, but you have to assume that it is going to become inferior to the competition very soon. You need to hustle ad beat your competition to that better mousetrap, and you need to do it over and over.

The amazing thing about success is that it leads to a subconscious entitlement mentality that cause you to believe that you no longer need to do all the dirty work of getting out and studying consumer behavior in details, analyzing different sales approaches, jumping on the latest technology to generate improved products, and everything else that is required to stay ahead. The attitude is often one of believing that you have done all of that and have figured it out, and now things are going to be fine.

Until the early 1970s, typewriters were used to prepare documents. The IBM Selectric model was the standard. Then along came Wang Laboratories’ word processor in 1976, providing a completely new approach. It displayed text on a cathode ray tube (CRT) screen that was connected to a central processing unit (CPU). In fact, you could connect many such screens to that CPU in order to handle many different users. Wang’s device incorporated virtually every fundamental characteristic of word processors as we know them today, and the phrase word processor rapidly came to refer to CRT-based Wang machines. Then, in the early to mid-1980s, the personal computer emerged. Wang saw it coming but made no attempt to modify its software for a personal computer. PC-based word processors like WordPerfect and Microsoft Word became the rage, and Wang died. Wang fell into the trap of not updating its products, even though it basically invented the word processor industry.

We saw this behavior very clearly with the General Motors example. Its cars, while highly distinctive back in the 1970s, were allowed over time to look more and more alike, and the excitement factor for the customer disappeared.

TRAP 3: BOREDOM
Clinging to Your Once-Successful Branding after It Becomes Stale and Dull

Constantly achieving uniquencss and distinctiveness for a brand and also keeping it fresh and contemporary is hard work. Once a brand achieves some success, the tendency is to sit back and pat yourself on the back, allowing your brand to become dull and ordinary.

The Plymouth automobile was introduced by Chrysler for the 1928 model year as a direct competitor to Ford and Chevrolet. It was a sturdy and durable car that attracted a legion of loyal owners. Plymouth became one of the low-priced three from Detroit and was usually number three in sales, just behind Ford and Chevrolet. For almost two decades, Plymouth sold almost 750,000 cars per year and had a solid brand reputation in the low price range of being reliable but having a bit more flair than Chevrolet or Ford. Older readers may remember the 1957 Plymouth with the huge fins, as well as its Road Runner (beep beep!) model. Plymouth had a very clear brand positioning.

In the 1960s, the Plymouth brand began to lose its uniqueness. Chrysler decided to reposition the Dodge, reducing its price so that it was quite close to Plymouth’s. Chrysler came out with low-priced compact and intermediate-size models under both the Plymouth trademark and the Dodge trademark. By 1982, Dodge, was outselling Plymouth. Throughout the late 1980s and the 1990s, Plymouth offered nothing unique. Sales continued to decline, while Dodge was quite healthy. In 1999 Chrysler announced that the Plymouth brand would be discontinued. The lesson is simple: when you allow brands to get stale, they die.

TRAP 4: COMPLEXITY
Ignoring Your Business Processes as They Become Cumbersome and Complicated

Successful organizations often reward themselves by adding more and more people and allowing processes to become fragmented and nonstandardized. This is often done under banner of refining the management of the business. It is also caused by business units and subsidiaries seeking more autonomy, which leads them to develop their own processes and staff resources. Before you know it, getting any kind of change made is very complicated.

Over and over again you read stories about organizations experiencing weak financial results, then finally coming to grips with the problem, laying off thousands of people and simplifying the organization.

We saw in our Toyota case study how aggressive that company is at constantly improving each and every process. Keeping that mindset of constant improvement is very difficult. Success usually leads to a decrease in the intensity with which you tackle such challenges. Also, success leads to a belief that since we are doing so well, we probably need to reward the people in the organization who are asking for their own building and lots of extra people to get them to the next level. Importunely, all those extra costs often lead to bloated processes and further fragmentation of how work gets done.

TRAP 5: BLOAT

Rationalizing Your Loss of Speed and Agility

Successful organisations and individuals tend to crate complexity. They hire a lot of extra people, since clearly things are going well, and those people find things to do, often creating layers of bureaucracy, duplicating capabilities that already exist in the organization, and making it very hard to react quickly to change.

Getting an organization to constantly think about retaining simplicity and flexibility is not easy. The account given in the previous chapter of Toyota’s Global Body Line is a good example of doing it right. Toyota thought about agility ahead of time, and when it came time to build a brand-new car, such as the Prius, it didn’t have to build a new plant or a new line. This enabled Toyota to get to market fast and save tens of millions of dollars compared with traditional approaches.

TRAP 6: MEDIOCRITY

Condoning Poor Performance and Letting Your Star Employees Languish

When organizations are successful, they have a tendency to stop doing the hard things, and dealing with poor performance is a really hard thing. It also becomes hard to move new people into existing jobs, because there is the burden of getting the new person up to speed and the perception that you are losing valuable expertise. Also, the really strong performers and to get ignored. Consequently, what happens in many successful organizations is that people are left in their jobs too long and poor performance is not dealt with as crisply as it should be. Unfortunately, this also leads to strong players not being constantly challenged.

Successful organizations are especially vulnerable to this trap, since companies that achieve success often have high morale and pride. And who wants to spoil the fun by dealing with the tough personnel issues, which is an onerous task for most managers? Any excuse to put it aside will be embraced.

TRAP 7: LETHARGY

Getting Lulled into a Culture of Comfort, Casualness, and Confidence

Success, and the resulting tendency to become complacent, often leads organizations and individuals to believe that they are very talented, have figured things out, have the answers to all the questions, and no longer need to get their hands dirty in the trenches. They lose their sense of urgency � the feeling that trouble might be just around the corner.

Considering our case studies on GM and Toyota, the contrast between their cultures is really striking. GM seems to exude pride and an attitude of “we are the real pro in the industry,” while Toyota has a more humble personality that is all about constant improvement.

The leader of a group really sets the tone on this cultural complacency issue. The tendency is to become very proud of your success and protective of the approaches that got you there. It is those very tendencies that lead to an insular, confidence culture that makes people believe that they are on the wining team, while in reality, the world is probably passing them by.

TRAP 8: TIMIDITY

Not Confronting Turf Wars, Infighting, and Obstructionists

Success often leads to the hiring of too many people and the fragmentation of the organization. Business units and subsidiaries work hard to be as independent as possible, often creating groups that duplicate central resources. Staff groups fragment as similar groups emerge in the different business units. Before long, turf wars and infighting emerge, as who is responsible for what becomes vague.

Even worse, the culture gets very insular, with an excessive focus on things like who got promoted, why am I not getting rewarded properly, and a ton of other petty issues that sap the energy of the organization.

Another source of turf wars and infighting is lack of a clear direction for the organization and slow decision making on critical issues. When these kinds of management deficiencies occur, people are left to drift and end up pulling in different directions. That often leads to tremendous amounts of wasted time as groups argue to have it their way.

TRAP 9: CONFUSION

Unwittingly Providing Schizopherenic Communications

When an organization is success or stable, its managers often fall into the trap of not making it clear where the organization is going from there. Sometimes this is because they don’t know, but they don’t admit that, and they don’t try to get the company’s direction resolved. They do everything they can to keep all option open, with no clear effort to get decisions made and a plan developed. Such behaviors lead to speculation by the troops, based on comments that they pick up over time. Often those comments are offhand remarks that the leaders have not thought through. Or the troops hear conflicting statements coming form a variety of folks in leadership positions in the organization.

When employees receive confusing and conflicting messages and don’t have a clear picture of where the organization is gong or whether progress is being made, they feel vulnerable and get very protective of their current activities. In late 1991, IBM’s CEO,John Akes, announced that in the future, IBM would look more like a holding company and that “clearly it’s not to IBM’s advantage to be 100 per cent owners of each of IBM’s product lines.”

During the next 12 months, everybody was trying to figure out what he meant. And IBM made no attempt to start publishing separate financial information by product line in preparation for possible spin-offs. IBM also ignored Wall Street’s suggestion that it create separate financial entries, with their own stock exchange symbols, for the products that were to be spun off. Employees and investors were confused. The IBM board of directors finally ended the drama in early 1993, announcing that Akers was leaving and a new CEO would be hired quickly. From 1987 to 1993, IBM shareholders lost $77 billion of market value.

Communications from the head of the organization, be it a small group or an IBM, are critical. People want to know where they are headed and how things are going. When the words and actions don’t match, confusion reigns.

In the remaining parts of this book, I will discuss these traps in detail. In each part, I will give detailed examples of companies and individuals that in some cases have been hurt and in other cases have avoided these problems. My objective in each part is to provide specific actions that people can take to avoid the particular trap, or to rid themselves of the problem.

Excerpted from:

Seduced by Success by Robert J Herbold.

Copyright 2007 by Robert Herbold. Price: Rs 495. Reprinted by permission of Tata McGraw Hill Publishing Company Limited. All rights reserved.

Robert J Herbold was hired by Bill Gates to be chief operating officer of Microsoft Corporation. During his seven years as COO of 1994 to 2001, Microsoft experienced a four-fold increase in revenue and a seven-fold increase in profits.

Act in haste, repent at leisure

Posted on October 6, 2007

Act in haste, repent at leisure
1 Oct, 2007, 0339 hrs IST,K VIJAYARAGHAVAN, TNN

The story of ‘Kuttathy sisters’ was often recounted by late Seetha Venkatachary, a very good narrator of didactic tales of ancient India. This story illustrates the axiom that one should think twice before acting harshly and that hasty actions would be followed by agonising repentance, which would be of no avail.

Taken from Kerala folklore, this story involves Valia (the elder) Kuttathy and the Kochu (the younger) Kuttathy, who were birds of a particular species, living in happy companionship. One day, Valia Kuttathy obtained from outside, some green gram. She entrusted the job of frying these to Kochu Kuttathy, as she went out.

On her return, she inspected the fried pulses and observed that the quantity had reduced. On being accused that she had eaten a portion of these, Kochu Kuttathy pleaded her innocence. Enraged at what she presumed was her sister’s cheating and lie, Valia Kuttathy attacked her younger sister and killed her.

Another day when Valia Kuttathy herself fried some newly obtained green gram, she found, to her dismay, that the quantity had reduced. On enquiry with others, she came to know that such pulses generally reduce in size on being fried.

In painful remorse, Valia Kuttathy spent the rest of her life, crying out to her dear sister, “Kochu Kuttathy, urr.. urr.. Kochu Kuttathy, urr.. urr..” Malayalam folklore has it that, to this day, the same painful cries can be heard at certain times, from an untraceable bird — possibly a descendant of Valia Kuttathy.

The need to be vigilant against impetuous actions is also underlined by another well known story of a lady, who once went out to fetch water, leaving her infant child to the care of her pet, a mongoose. On return, she observed that the mongoose had blood stains all over its mouth. Presuming that it had devoured her child, she threw the pot on it, instantly killing the creature. Screaming, she thereafter went to her child’s cradle, expecting to find the mangled remains. Surprised, she saw the child peacefully asleep, while a dead snake lay nearby, obviously killed by the mongoose which had intercepted this killer, while it had slithered up the cradle.

Hasty and ill considered actions and also such words, bring in their wake sufferings all over. A well known Tamil proverb observes, Kaanpathum poi, ketpathum poi, theera vicharipathe mei (even what we see and what we hear could be misleading; what is ideal is proper inquiry and analysis). Indeed these are words of great wisdom!

Giving back to Society

Posted on October 4, 2007

Giving back to Society
By Robert Ditcham, Staff Reporter GULF NEWS Published: October 03, 2007, 23:52

Ask company employees about the importance of addressing global poverty, illiteracy, homelessness and environmental decay and most will say they care deeply.

Although they may do their bit, financial restraints and limited time may hinder their charitable efforts.

Their employer, on the other hand, has the financial muscle, brand status and human resources to tackle these issues head on. But is it actively engaging in corporate social responsibility (CSR) programmes?

In the UAE, the answer is more often than not a negative one. Brand analysts and companies say CSR in the UAE is in its infancy compared to North America, the Far East and Western Europe.

“Developed markets have been open for longer, commercial models and structures have been established, while consumers and pressure groups have grown in importance and in their ability to scrutinise and apply pressure to companies,” said Manal Shaheen, director, sales, marketing and customer service at real estate giant Nakheel.

However, she and many others say the UAE could be on the verge of embracing the global CSR phenomenon, with the recently-launched Dubai Cares campaign providing the much-needed catalyst.

At the time of going to press, nearly Dh700 million have been raised under the initiative, which will put one million children through primary education.

“Of course, there is still some way to go in this part of the world, but I believe that CSR will grow more rapidly than it did in those other regions because the momentum has built up, and lessons – both good and bad – have been learned,” Shaheen said.

As with any decision in the corporate world, there needs to be clear benefit to the firm itself. Why should companies invest in society at large when their primary concern should be their shareholders? After all, isn’t it the job of politicians to tackle society’s ills?

Obligation

According to CSR promoters, companies have a moral obligation to support society and the environment.

“We believe that CSR initiatives are a means for us to give something back to the society and the nation that has handed us everything to get us to where we are now,” said Princy Philip, manager for marketing and corporate communications at UAE property developer Memon Investments. “This fact makes it our moral responsibility to care for the unfortunate and provide for the unloved.”

Defining the business case for CSR is often more of a challenge. But, in a world where brand value and reputation are increasingly seen as a company’s most valuable assets, the pros are becoming more apparent to UAE chief executives.

According to an Ernst & Young survey in Europe, 94 per cent of company executives believe the development of a CSR strategy can deliver real business benefits.

“CSR is becoming more and more important in terms of building a strong corporate brand image, while companies are facing increasing pressure from their clients, customers and staff to be responsible corporate citizens,” said Hermann Behrens, the Dubai-based managing director of brand consultants Enterprise IG.

Behrens stressed that in the Gulf’s competitive job market, potential employees factor in a company’s CSR record when choosing their future job, selecting those that can make a positive impact on society.

According to the organisation CSR Europe, 78 per cent of employees would rather work for an ethical and reputable company than receive a higher salary.

CSR Europe argues that a “responsible attitude” towards society and the environment can make a business more competitive, more resilient to shocks, and more likely to attract and hold both consumers and the best employees.

Business sense
And in a world where socially responsible investment is growing, CSR can also attract investment and save businesses money in dealing with regulators, banks and insurers, the organisation adds. It says socially responsible investment accounts for nearly 13 per cent of the $16.3 trillion in investment assets under professional management in the US.

“The reason companies are taking the issue more seriously because it makes good business sense,” said Shaheen.

“Firstly, it has become clear recently that financial markets are factoring in some of the ‘sustainability’ issues into their valuations and decisions to invest or move their funds.

“Secondly, as customers get more savvy, it’s getting easier to compare the Good and the Bad. There is enormous value with your customers if they know you are one of the good guys and it’s no coincidence that people are prepared to pay a premium for this.”

But adopting CSR initiatives doesn’t always result in a rosy picture being painted of a company. Those that throw money at environmental causes and champion human rights, but also pollute the atmosphere and exploit their workers, will soon be found out, resulting in spectacular public relations disasters.

Behrens said good CSR is about a lot more than donating large sums to noble causes. A CSR campaign that engages the whole company in its ethos and gets its staff involved in charities or social work will have the best results, he said.

Shaheen said Nakheel is aware that CSR is much more than making “token gestures”.

“Although it’s quite normal for companies to make big statements, huge promises, or grand gestures, negative impressions can often be caused by what I’d call ‘tokenism’ – when companies obviously bolt-on campaigns or initiatives that are clearly superficial gestures and not integrated into the ethos of the company,” she said.

“I think that a lot of companies are on the journey from one to the other at the moment.”

The corporate sector’s swift response to the Dubai Cares campaign is among several examples of CSR being pursued in the UAE.

Memon Investments, a Dubai-based property developer and part of the international business conglomerate, the Memon Group of Companies, recently announced its participation in the ‘Safe & Sound’ campaign – BurJuman’s breast cancer awareness programme – as the official annual sponsor.

This will mark Memon Investments’ first CSR undertaking in the region.

Giant property developer Nakheel said it has established initiatives such as Bidaya, an educational and leadership programme aimed at discovering and nurturing the UAE’s next generation of leaders.

The programme offers university scholarships to outstanding male and female candidates from the country’s public high school system.

As one of its key CSR initiatives during 2007, Dubai Holding recently said it has pledged nearly Dh1.5 million to two organisations – the UAE Beit Al Khair and the Dubai Autism Centre.

Over the past two years, Dubai Holding has contributed more than Dh80 million in projects such as a facility for Zayed University and Dubai Education Council.

“Even as we rapidly drive our business to cross new milestones, we regard it as our duty to share the responsibility of the general welfare of the community,” said Mohammad Al Gergawi, executive chairman of Dubai Holding.

Meanwhile, a golf team from oil and gas major BP decided to use its $1,000 prize money won in a golf tournament recently to pay for a facility for autistic children at the Future Centre in Abu Dhabi.

Multinational corporation Halliburton has also made donations to The Future Centre, which provides schooling for children with special needs, through its Halliburton International Fund.

Job Hopping!!

Posted on September 30, 2007

Mr. Gopalakrishnan succeeds Mr. Ratan Tata as Chairman of Tata Sons
Ltd., the holding company for many of the Tata Bluechips like Tata
Steel, Tata Motors, Tata Power, Tata Chemicals, Voltas, etc.,

Possibly he is the first non-Tata person to head the Tata Empire.

The grass isn’t always greener on the other side!!

Move from one job to another, but only for the right reasons. It’s yet
another day at office. As I logged on to the marketing and advertising
sites for the latest updates, as usual, I found the headlines
dominated by ‘who’s moving from one company to another after a
short stint’, and I wondered, why are so many people leaving one job
for another?

Is it passé now to work with just one company for a sufficiently long
period?

Whenever I ask this question to people who leave a company, the
answers I get are: “Oh, I am getting a 200% hike in salary”; “Well, I
am jumping three levels in my designation”; “Well, they are going to
send me abroad in six months”.

Then, I look around at all the people who are considered successful
today and who have reached the top – be it a media agency, an
advertising agency or a company. I find that most of these people are
the ones who have stuck to the company, ground their heels and worked
their way to the top. And, as I look around for people who changed
their jobs constantly, I find they have stagnated at some level, in
obscurity!

In this absolutely ruthless, dynamic and competitive environment,
there are still no short-cuts to success or to making money. The only
thing that continues to pay, as earlier, is loyalty and hard work.
Yes, it pays!

Sometimes, immediately, sometimes after a lot of time. But, it does
pay.

Does this mean that one should stick to an organization and wait for
that golden moment? Of course not. After a long stint, there always
comes a time for moving in most organizations, but it is important to
move for the right reasons, rather than superficial ones, like money,
designation or an overseas trip.

Remember, no company recruits for charity.

More often than not, when you are offered an unseemly hike in salary
or designation that is disproportionate to what that company offers it
current employees, there is always unseen bait attached.

The result? You will, in the long-term, have reached exactly the same
levels or maybe lower levels than what you would have in your current
company.

A lot of people leave an organization because they are “unhappy”. What
is this so-called-unhappiness? I have been working for donkey’s years
and there has never been a day when I am not unhappy about something
in my work environment-boss, rude colleague, fussy clients etc.

Unhappiness in a workplace, to a large extent, is transient.

If you look hard enough, there is always something to be unhappy
about.

But, more importantly, do I come to work to be “happy” in the truest
sense?

If I think hard, the answer is “No”. Happiness is something you find
with family, friends, may be a close circle of colleagues who have
become friends.

What you come to work for is to earn, build a reputation, satisfy your
ambitions, be appreciated for your work ethics, face challenges and
get the job done.

So, the next time you are tempted to move, ask yourself why you moving
and what are are you moving into.

Some questions are:

* Am I ready and capable of handling the new responsibility? If yes,
what could be the possible reasons my current company has not offered
me the same responsibility?

* Who are the people who currently handle this responsibility in the
current and new company? Am I as good as the best among them?

* As the new job offer has a different profile, why have I not given
the current company the option to offer me this profile?

* Why is the new company offering me the job? Do they want me for my
skills, or is there an ulterior motive?

An honest answer to these will eventually decide where you go in your
career- to the top of the pile in the long term (at the cost of
short-term blips) or to become another average employee who gets lost
with time in the wilderness?

“DESERVE BEFORE YOU DESIRE” – Dr. Gopalkrishnan, Chairman TATA Sons.