PPI #43 Run Your Business Like a Team, Not a Family

 
 

SUMMARY 

  • Many leaders refer to their company or team as “family”. But you will never achieve high performance running a family instead of a team. That's because families stick together no matter what, while teams are optimized to perform and win. In this episode, I’ll present six ways to transition from running a family into running a team.
  • First and foremost, imagine a sports team. A coach who sees the players as family will not demand performance. A non-performing sports team will lose fans, and eventually the players and coach will get replaced. The same applies to a business. 
  • The first thing to do is to stop using the word “family” altogether. Try to swap it out in all your business communications. Instead, use the word “team”.
  • Secondly, keep score. Keeping score doesn’t mean encouraging toxic competition, but trying to exceed the metrics set out for them, and to make sure everyone’s results are visible to everyone else. This will turn people’s focus toward performance.
  • Number three is to hire people based not just on competence, but also values. It’s the values that keep the team together. Learn what values the best performers in your company have, and design your hiring process around these values.
  • Number four is invest in professional development. Help your people become the best version of themselves, not just professionally but personally. Let them embody the company’s values.
  • The fifth way is to do the life raft exercise every quarter. Who would you save if the ship goes down? This will help you identify who the best performers are, and also develop ways to improve the non-performers.
  • Last but not least, do not shy away from difficult conversations. Address poor performance, and make sure people understand if and when their job is on the line. 

TRANSCRIPT

If you're like many leaders, you could probably remember a time when you referred to the company or the team as a family. I mean, what's not to like about a family after all. But the truth is you'll never achieve high performance running a family instead of a team. That's because families strive to stick together no matter what, whereas, teams are optimized to win at all times. Hi, my name is Eric Partaker, and I've led high-performing teams at McKinsey and Company while helping build Skype before we sold to eBay and through several of my own businesses. Today, I want to take you through six ways in which you can transition from running a family to running a team and achieve much higher performance as a result.

But first off, I'd like you to imagine the following. Imagine you're watching your favorite sports team, and during the course of the season it becomes clear that the coach is hanging on to team members that aren't performing very, very well because he's thinking of them as family members. He wants to hold that family together and just keep them on because hopefully, they'll get better at some point. Now, what's going to happen? As that team continues to not perform, as they continue to lose games, the fans are going to become outraged. Eventually, those players will not only be transferred off the team, but the coach him or herself will also be asked to leave. I don't want that to happen to you, but it's a clear risk if you're running a family as opposed to a team. So with that, let's get into it, six ways in which you can transition from running a family to running a team.

Number one, stop using the word family. Think about your company communications, think about how you refer to or talk about people within your one-on-one or team meetings. Try to swap that word family in every single instance with team and encourage those in your company to do the same. Take them through this same example that I've given you earlier, how families strive to stick together no matter what, whereas, teams are designed and optimized to win. Number two, keep score. People love scoreboards. When you introduce scoreboards, it brings out that team spirit. I don't mean bringing out scoreboards that are measuring every single person in the company against each other. I'm not saying we should create competition within, although some of that can be healthy as well, but I mean more about how is the team or the department doing against the metrics that were set out for them at the start of the quarter or that they set out for themselves, and having that somewhere visible, somewhere where everyone can see it.

Think about this, for example. If you're walking by a playground, and you see some kids playing basketball or football, and if there's no score involved, there'll be playing in a certain way. But the moment you introduce a scoreboard, the moment something's on the line, the moment it becomes a competition, the moment it's first to 10 and you win a prize, the moment there's an incentive to win, it changes the way they play. They play more competitively. They play as a team if they're in a group, or they play just more competitively individually if it's just one-on-one. But you'll tap into that spirit, that team spirit by introducing scoreboards and making sure that the company's performance and the departments and everyone's results are highly visible to everyone, just like a scoreboard is at our favorite sporting match.

The number three thing that you can do to help you transition from running a family to running a team is really make sure that you are hiring and promoting not just based on competence, but also values. It's the values that really keep that team together. You should be hiring against them by looking at, well, who has done super well in the company, why have they done well? And also, who have we gotten rid of? Why did we get rid of them? The antithesis of the reasons for why you got rid of someone are great candidates for your values. Similarly, the reasons why you've promoted someone are also great candidates for your values. You can take those values, and you can design questions against them. Let's say, for example, one of your values is principled. You could be saying in an interview, "Tell me about a time when you realized that you just had to stand up for what was right despite what others might have been thinking."

Or maybe one of your values is determined, and you could be designing a question, for example, "Tell me about a time when you had to work despite the odds." Or perhaps one of your values is simply fun, and you could be asking a simple question along the lines of, "Tell me about the last time you had some fun, what was it that you were doing?" Also, you can be promoting against those values. What I mean is that when we're doing our performance reviews or quarterly award celebrations, whatever you do within your company or your team, what we can be doing is making sure that we're aligning some of the discussion and the incentives against our values. For example, at a quarterly award ceremony, why don't you have an award for each of your values, which are voted on by the team themselves and awarded to the person who most represents that value? These sorts of things create incredible team unity. Families have this naturally because of how they stick together. But you really have to proactively create this within a team because the people haven't grown up with each other, they haven't been around each other for so long. You have to identify what is making that team stick together, values-wise. Hire against it, and make sure you're constantly promoting against it as well.

Number four, you can invest in people's professional development. What a more powerful thing than to make someone feel like that their job or place of work is not only helping them do a great, but it's also helping them become the very best version of themselves. This was actually a central point in the culture at one of the companies that I built. Our mantra was, "Let's help our people become the very best version of themselves, not just professionally but also personally." We designed training and work programs to help them do exactly that. That really, really brought the team together and really fostered this incredible level of high performance.

Number five, I encourage you to do the life raft exercise every quarter. This exercise is simply if the ship was going down, and we had a life raft, and we could only save a quarter or half or three quarters of the people, whatever the metric is, who would we save? I know it sounds like a bit of a morbid exercise, but it helps you identify who's not performing as much or as well as you would like. And then the natural question is, well, what's the timeline for either improving that person's performance or helping them find their next role or next job on a team or a company that would be better suited for them? I also encourage you to do that with your managers, push that down to them as well, have them do that within their teams, within their structures, asking the very, very same question.

The number six thing that you can do to help you transition from leading a family to leading a team so you can be achieving higher levels of performance is have difficult conversations more often. This is something that I've talked about before at length, and it's such a critical thing for people to be doing. When I'm coaching CEOs, entrepreneurs, leaders, managers, one of the things that always comes up is that they don't have difficult conversations often enough. That family feeling is the thing preventing them from doing it. They're not thinking of themselves as actually trying to optimize, fully optimize a team to win. The three conversations that they're not having often enough are around fairly good but not great performance. For example, someone does fairly good, but not great. But think about it this way, is fairly good, is that enough to win market share? Is fairly good enough to win championships? Is fairly good enough to win battles? No, we need great performance. And so you have to have the courage to tell people when they're fairly good but not great.

You can do that in a positive way, for example, by saying, "Hey, did an okay job with this or the performance was pretty good, but how might we do this better next time? Or how would the best version of you have done this differently? The second difficult conversation that doesn't happen often enough is, your job is on the line. So the moment you feel that someone's job is on the line, that the role is on the line, that's the same moment you should be telling them that. You're doing them a disservice by not sharing that with them. The typical lag that I see is three to nine months before a CEO or a leader, a manager actually has that conversation. And that's three to nine months for the company and the team's performance to suffer, but also for your leadership, as everyone sits there questioning, why isn't the leader, you, doing something about this? So make sure people understand if their job is on the line that it is, and then what do they need to do to improve.

And then the third difficult conversation that doesn't happen quickly enough, or often enough is you're fired. We often just keep people on the team too long. Again, think about a sports team. If somebody's not pulling their weight, if despite training, despite the encouragement, if they're just not occupying or performing that role well enough, what eventually happens? They get traded off the team, and someone else gets brought on to replace them.

Those are six ways that you can help transition from leading a family to leading a team for much higher levels of performance in whatever it is that you're doing.

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