Michael Hannan wanted to make changes that had an immediate impact when he took over as president and chief executive officer of Banff-based tour operator Brewster Inc. last winter.
While he started making strategic moves almost immediately, he took his time making the most difficult decisions he faced: who in his management team was to stay and who should be replaced.
"We had an embedded culture - Brewster is a 118-year old company. I knew it meant culling and looking for new people to bring in to replace people who needed to go because they no longer fit," Mr. Hannan recalled.
"I needed to do that as quickly as possible, but I didn't want to knee-jerk," he added. "It takes a careful approach to shaking up a culture, especially with a company that is successful."
It's a dilemma faced by an increasing number of top executives under pressure to revive their organization in the wake of the recession, said leadership development specialist Jim Murray, CEO of Optimal Solutions International in Maxwell, Ont.
"In the current economy, expectations have never been higher - everyone's watching … boards, shareholders, key customers and the media," said Dr. Murray, who teaches courses for new CEOs at the Institute of Chartered Accountants of Ontario.
To be effective, a primary task for an incoming chief executive is to determine if he or she has the right people in the right roles, he said. "If the evidence is contrary, you must make the changes quickly. Letting the decision drag on or avoiding it only undermines your early initiatives."
From experience, though, "I find that most executives are reluctant to pull the trigger, especially when the person targeted is in a key role," Dr. Murray said.
That's also the topic of a new book, Necessary Endings: The Employees, Businesses and Relationships That All of Us Have to Give Up in Order to Move Forward. In it, Los Angeles-based psychologist Henry Cloud has this advice for leaders: "If you are truly leading, you will be firing some percentage (of your employees and managers). It is almost a truism: If you are not firing someone at some time, something is probably wrong."
The author recommends asking four questions about every employee who isn't meeting expectations: What has the performance been so far? Is it good enough? If not, is there anything in place that would make it different? If not, am I willing to sign up for more of the same?
If the final answer is no, then - as draconian as it may sound - leaders should wield the axe decisively, Dr. Cloud advises.
Dr. Murray agrees. "Those I mentor always tell me, in hindsight, that they should have made the move sooner rather than later," he said. "It's essential to build the culture that you need to be successful, and if you tolerate [poor]performers it will be both a drag on the entire organization and reflects poorly on your leadership."
Mr. Hannan didn't want to delay the inevitable, so he made it a priority to assess the potential of each of his team to fit Brewster's goals for growth.
"I did that by working with them and spending time with them in meetings, and meeting customers with them and listening to them and evaluating the results," he explained. "I was not only assessing the raw talent but also the attitude of everyone in the organization."
He found that most of the employees "were actually thirsting for change and wanted to update the company and get into a growth agenda and move forward."
But about one-quarter of the staff needed more analysis, Mr. Hannan said. "Certain people were more resistant to change. And there were people who said they wanted to see change, but then when it came to start implementing changes, they really didn't want to."
Within three months he had made his decision. Ten in the management team were to be replaced and another 10 moved to other roles better suited to them in the new organization.
"It takes time and thinking and rethinking, but when you finally come to a decision you can't procrastinate," Mr. Hannan said. "If management is tolerating or overlooking poor performance, it sends the wrong message."
He said the results have been strong for Brewster; in the first nine months of the year, revenues increased 17.6 per cent, year-over-year, and profits rose more than 16 per cent.
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RED FLAGS
For new leaders, it's essential to closely examine your management group and cull those who could undermine both your performance and that of your company, leadership mentor Jim Murray advises. Here are the "red flag" traits of those who could be trouble:
Sycophants: These servile flatterers will tell you what you want to hear and applaud your poor decisions, creating blind spots and distracting you from issues that need attention.
Freeloaders: People who consider themselves "key executives" who don't need to (or can't) carry their weight on the team or make necessary tough decisions.
Deal makers: These care more about their success than yours or that of the organization, and form alliances with other members of the executive team that they use to their own advantage.
Filters: They want to act as gatekeepers who don't communicate what they gather and inadvertently insulate you from the pulse of your company.
Frenemies: While outwardly friendly, their purpose is to undermine or usurp your authority. These self-promoters show little remorse when cornered.
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TAKING CHARGE
Be effective, not busy: Too many senior executives, including CEOs, bury themselves in their day-to-day activities on the wrong-headed notion that if you're "up to your eyeballs" in work, you must be critically important to every thought and action the company takes.
Being busy without being effective means you're failing as a leader, says leadership expert Jim Murray. The more you act as a doer of work, the less you lead. Worse, you are not doing the work only a leader can and should be doing. Being busy can be addictive and demonstrates a lack of trust in others.
Demonstrate your value: Intelligent self-promotion (a learnable skill) is important before you get to the C-suite but even more crucial during your tenure. The day you stop promoting yourself is the day you stop advancing, Mr. Murray said.
Grab the initiative: Never stand on the sidelines awaiting an invitation to get in the game. Get involved in new projects and challenging assignments. Ask for them and go to bat as often as you can.
Speak your mind: Speaking up when you sense your boss's initiatives need some work is not career limiting, it's smart. Chief executives don't want clones; it doesn't advance the corporate agenda.