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Hey there, and welcome to Episode 44 of the No Bullshit Leadership Podcast. This week's episode, The Standard You Walk Past is the Standard You Set. One of the most important roles that a leader plays is to set the right standards for performance and behaviour that the team, group or organisation is expected to rise to. Often, we think we're setting a high standard of performance but it's the exceptions that we make that tell people what the real standard actually is. How do you make the standard that people must reach really clear and then ensure that it's carried through from top to bottom in your team.
We'll start by talking about choosing the standards and making sure that you, above anyone else, are signed up to upholding those standards. We'll move onto some of the common areas where we unwittingly make exceptions and send the wrong messages to our people. I'll give you an example from the past where I didn't uphold the standard I thought I had set, and then we'll finish with some rules of thumb to keep yourself honest on keeping the standards for the team high. This will be available from Your CEO Mentor Website as a free downloadable pdf at www.yourceomentor.com/episode44, so let's get into it.
Leaders, academics and consultants alike talk about high performing teams and high performance cultures ad nauseam, but what do those terms really mean and how would you go about building a team like that? Well, of course it starts with the individuals in the team as we spoke about all the way back in Episode Two, but it's also about setting the right tone, pace, and standard for your people. Today's episode is about the standards you set. We'll leave tone and pace for future episodes. What we need to do is to strip away all the bullshit and myths that people believe, convincing themselves that everything is going really well when, in fact, it's going about the same as most average teams in the average organisation. To tell you the truth, I haven't seen too many high performing teams in my time. Of all the teams that I've lead during my career, I would say that I have built maybe one or two high performing teams but only a couple at most. It is elusive and it takes a huge amount of energy, commitment .and strength to do this.
First up, we need to ask ourselves the question, how do you actually set the standard? By implication, of course, we're talking about setting a higher standard because you already have a standard in place and it takes nothing to keep that ticking along, that is part of your existing culture. We set standards in two areas, behaviours and performance. The behaviours and conduct of your people is largely cultural. It's very, very hard to describe this because it's absolutely not rule-based. The people take cues from seeing everything that happens around them. For example, when you're coming into the end of year and everyone's bonuses are at stake on hitting particular financial targets, how do you treat the accounting rules? Do you tell your finance department to get super, super creative so they can get you over the line so you can get paid your bonus or do you tell them to play a very straight bet and just do it the way it's supposed to be done, conservatively against the rules and against your risk tolerances?
How do you treat others and how do you expect your team to treat each other? What are your expectations around contribution of people to the greater good and collaboration between different business units that you might have and the different silos inside your organisation? How about safety, that's a big one. What behaviours do you find acceptable and do you let people just do what they want to do or do you make sure that they have a behavioural standard that is extraordinarily high that if they don't live up to they have consequences for? What standard do you set for the accuracy and timeliness of the information that's being presented to you that gives you your management information?
These are just a few examples to give you an idea of what cultural cues we're sending to our people about the standards expected of their behaviour and conduct, and there are many, many, many of these every single day that your leaders need to understand how to uphold. If they're not setting the right standards in these areas, slippage happens very, very quickly and it always goes to the path of least resistance. Let's talk about performance. When you're setting performance targets, they've got to be tough. They've got to be hard to achieve and they've got to be stretched targets, not easy ones. You've gotta be able to put self-interest aside. I know a lot of people who tend to make their targets very, very easy to achieve so that they can all get their bonuses hinged on that.
Self-interest comes way ahead of actually doing the right thing for the organisation and stretching to difficult standards. An example that's very close to my heart is that when I was CEO of CS Energy we set very tough standards for safety performance. In fact, our number one measure on our corporate scorecard we missed five years in a row, but what it did for us is that it made us aspire to something that was a really, really difficult to achieve benchmark. Even though we didn't get there, we went so much closer than we would have had we not set that mark. In fact, that stretched our performance to way beyond where it otherwise would have been.
We had 20-25% of our corporate bonuses completely dependent upon this measure but I wouldn't relax the standard because it was about keeping our people safe. As we missed our targets a couple years in a row, the board was actually getting quite insistent as to why we were missing it so we went and did some benchmarking. We found that our nearest competitors, some of our peer organisations with very similar businesses, were setting the bar way lower than us. In fact, their performance, even though they were hitting their targets, was less than half as good as ours. In other words, they were entering twice as many people for the number of hours worked as we were. Now, I do have just one caveat here. Just be careful, if you are an unlisted company where earnings forecasts are provided to analysts, you can't be too aggressive.
If you don't meet a quarterly forecast, the market can punish you quite severely so you have to make sure that those targets are very realistic and quite achievable. In setting the right target, you've first got to start with yourself. You've got to work out where your team is now and where you think it could get to in the period of time that you're setting the targets for. You have to believe in the ability to get that target and then you have to enforce the things that would make that happen. Now, if you're not prepared to do this, don't set the standard there. Set the standard where you're comfortable that you can both role model it and enforce it, and it has to be rational. Don't set standards that don't make sense to your people. Once you have the standards for behaviour and performance that you're comfortable with, make it clear to all of your people what's expected. Communication is critical. Why are the new standards being set? What's the impetus and the catalyst for having you set higher standards than you've had previously?
It's really important that you explain this to people. What's the burning platform? Why do we need to do this now? Why do we need to change? If you work that out, you've got half a chance of people buying into it. Communicating that and communicating it well, and making sure that any leaders below you understand that and can also communicate it, is going to be quite critical. Just remember, no matter what you say, people watch your feet, not your lips. They're going to work out what you do, not what you talk about. This is why not walking past an inferior standard is oh so important. Also, bear in mind that rules don't work as well as value based targets. Now, I see a lot of people who go into a change scenario using what they call symbols of change and there's absolutely nothing wrong with that; but sometimes you see rules come out for things like dress standard or attendance standard because people want to set a mark that says we're going to do things differently. I just find that those don't work particularly well.
It does remind me of one very large successful multi-national organisation where the chief executive of the Australian business, in the late eighties and early nineties, used to stand every so often in the foyer of their offices as people were coming into work in the morning and, if people weren't dressed as he deemed appropriately, they would be sent home to change. Now, I don't think that that made any major difference to the performance of the organisation and it certainly didn't get people on board with the change in cultural standards.
I just want to give a few examples of how we can make unwitting exceptions to the standards we're trying to set and this is what I use the metaphor of the standard you walk past. The standard you walk past is the standard you set. In other words, if you let it go without comment, that's going to become the new prevailing standard regardless of what you thought you'd set in the past. For example, the standard around how we talk to each other. Now, most organisations say they have a level of respect and deference that you need to pay to people both inside the organisation and out. That's a standard that can be set by watching what's allowed in group situations. If someone's allowed to talk to someone rudely, condescendingly, dismissively, and you as a leader see that and don't stop that from happening, don't pull the individual aside and say, "Hey look, that is not acceptable in our organisation. That's not the standard we're setting here."
If you walk past and let that happen and make the exception that says, "Oh, well let's just Rob and sometimes he can be a bit of a hothead," guess what? You've just set a new standard for your people that is way lower than the one you would like to have. For example, when you tell people that there's a standard for the contribution that they need to make to the team, if you don't force them to bring their contribution to the table, you're setting a lower standard. When you have standards you talk about for truth and accuracy and reporting but then when truth and accuracy doesn't come the way you want it, you simply let that pass through, guess what? You're setting a new, lower standard.
Of course, the classic example of working in a safe manner. When you see someone that's doing something that is not in line with the high behavioural standards you're trying to set, you can't afford to walk past it. I mean this in the literal sense. I see people walking past unsafe behaviour and not stopping to talk to the person about what they're doing. I know it can be a little bit daunting. I'm a desk jockey, I'm a head office guy, so when I walk out on a plant and I have to have a conversation with somebody who's got 40 years of experience in doing their job and I say, "Hey look, I know you've got 40 years of experience but, to me, that doesn't look safe. Can we have a chat about it?" That's hard to do but if I don't do it, guess what? I let the standard of the last 40 years prevail, not the new standard that I think I'm trying to set.
I want to take an example from my not too distant past where I let the standard slip unwittingly when I thought I was trying to set a much higher standard. This was around one particular operational site that we had where it needed serious, serious work. Every indicator we looked at was poor; whether it was financial, cultural risk oriented, operational performance, everything was running poorly. We had people in there who swore that they were going to fix this site up, starting with my executive general manager. When the results didn't start to come through the way we thought, I listened to what they said. I watched their lips, I didn't watch their feet. "Don't worry, boss, our strategy is spot on. We're on top of everything. It's just taking longer than we thought."
Now, I allowed this great storytelling to take the focus off the standards in performance that I was trying to set but as I looked I knew intuitively that there were so many areas and so many indicators telling me that everything wasn't well. For example, when we looked at the talent pipeline and the ratings that were given to the leaders in that particular location, they weren't moving. They were still staying in a place that said they're not at full performance, yet we tended to ignore that because of the dialogue that said, "Ride through the chain, everything's going okay, we are making a difference."
Now, I pride myself on spending a lot of time at all levels in the teams and organisations that I've run and so I talk to everyone, everyone in breadth and everyone in depth through all layers of the organisation so I'll talk to the person on the tours. Eventually, I worked out that nothing was changing because at the bottom the story they were telling wasn't a story of change. Eventually, I had to get below my executive, below the GM, and into the management layers of that particular location to find out what was going on and to see who was doing what. Needless to say, we made lots of personal changes and now the facility is completely different a couple of years on. I lost at least six months of reform, at minimum, and possibly closer to 12 months because I allowed the standard to slip; all on the promise of, "Don't worry boss, it is working. We know what we're doing. It's just taking longer than we thought."
All right, so let's move onto the seven rules of thumb for standard setting. Rule number one, be ambitious. No one's going to get excited by standards that are loose or easy to achieve. Ensure that people know why the standards are changing and they have to be worth aspiring to. In other words, they're going to make the team or the organisation materially better than it is now. Number two, only be ambitious to the point you're prepared to enforce the standard yourself. If you're unprepared to live and model the standard, you will be branded as a hypocrite by your people. If you aren't prepared to enforce the standard throughout your whole team, your people will know that you are not serious. Make sure you can walk the walk, not just talk about it.
Number three, don't make exceptions for individual cases. Have the strength to deal with the under performance or the people who simply don't want to behave the way that you expect. Don't let them dictate the standard to you because your workforce is going to gravitate towards the lowest common denominator. Except, of course, for the high performers who will seek greener pastures where excellence is valued and rewarded. Number four, communicate relentlessly. Make sure all the layers of leaders in your team understand this and know they have an obligation to set the standard for their teams.
Test their progress and commitment at all layers and at every opportunity. If you see one of the lower level leaders walk past inferior standard of performance and behaviour, that tells you something about them. Number five, be aware of the common excuses for accepting a lower standard. For example, we have to pick our battles. I'm going to let this one go because it's not a big enough deal. Or something like, the standard is set but it's just taking longer than expected. Or My favourite, "Oh, that's just Rob. Everyone knows what he's like."
Number six, watch the scoreboard. Have measures in place across the board to inform you of progress along the way. Pay attention to them and ensure you don't accept under performance as the excuses invariably roll in. Number seven, be prepared to demonstrate that you are serious. If you're going to set a higher standard, then you have to be prepared to demonstrate that not meeting that standard is not an option. Have an upper out mentality for people who are strongly resistant to change and not prepared to move to the new standard. Give everyone a chance but learn to read quickly who has absolutely no intention of moving with you.
Alright, so that brings us to the end of Episode 44. Thanks so much for joining us. Remember, at Your CEO Mentor, our purpose is to improve the quality of leaders globally. If you are enjoying this podcast, please share it with the leaders in your network who you think will benefit and get them on the path to providing stronger, more capable leadership for their people. I look forward to next week's episode, Leaders are Learners.
Until then I know you'll take every opportunity you can to be a No Bullsh!t Leader.