Performance

Best Practices in HR Management Performance

By PALLE ELLEMANN KNUDSEN

To Lead or Manage is Not the Question

Leadership and business need information to be successful. This statement is confirmed by some managers around the world who have adopted a very analytical and collaborative approach to developing ideas and new strategies.

KEYWORDS

➜ Data complexity ➜ Collecting information and developing strategies ➜ Analytical skills and empathy ➜ Efficient management and effective leadership

We praise leadership skills such as the ability to listen, to show empathy and lead from one's inner self. We love stories about leaders meeting customers or employees on the shop floor and learning totally new things about the business. But is this really the full story about successful leaders and how they define the direction of the business? Stories are powerful communication tools and essential for branding – internally as well as externally. They are, though, just stories, typically showing single events or an individual’s perspective on specific issues. A leader’s world view is much more complicated than that. The globalization and digitalization of business (and everything else) has led to an explosion of data and complexity. Businesses can today gather extremely detailed data on consumer behavior at the same time that events taking place all over the world are impacting on key market conditions for any business, such as interest and exchange rates, commodity prices, consumer demand and regulation.

KNOWLEDGE IS POWER

“We measure everything,” says Henry Engelhardt, CEO of of Admiral Group. From systematically collecting information about how new employees imagine a great workplace to how many employees bring children to the Christmas party. And these data are not just stored in some kind of database. Engelhardt reads every description of a great workplace from new employees; just as well as he has met every one of the 4,000+ employees face to face to explain what the Admiral culture is all about. It would just have taken a few meetings for the marketing department to spin a story about how down-to-earth Engelhardt is when he meets new employees. But this is not what it is about. He wants to know and it has to be systematic to be sure that it captures the whole employee group. Engelhardt has probably read Pfeffer and Sutton’s book on “Hard facts, dangerous half-truths and total nonsense”, where the case for evidence-based management is made. The book stresses how important it is to get the data right in order to make the right interpretations of a company’s market conditions or the trends in the workplace. If you don’t know, you are navigating in blindness and your Titanic will eventually hit the iceberg.

WHEN TOYS MAKE IT CLEARER

At the market leading toy-maker Lego, the CEO Jørgen Vig Knudstorp has a very analytical and collaborative approach to collecting information and developing ideas and new strategies. “I see myself as the membrane to the external world, and one of my main tasks is to translate what the external world means to the company. So I visit the shops, talk to people who conduct research into future trends, talk to energy partners, seek new knowledge, understand the political situation in China if we are going to establish a factory there one day, and so on. I have dialogue, take a few notes, chew things over, talk to a few more people, and chew things over some more. Then there is a directors' board meeting, a management meeting or a management seminar which provides the opportunity to talk about these things, and then I digest it in the writing process where my thoughts

The photos are from the series

America’s Sweetheart. Elegant women dressed in vintage finds and armed with tools and common household items, Kelly Reemtsen’s paintings create a paradoxically edgy air of nostalgia. Reemtsen’s accessorizing of her figures, with objects, clothing, titles and even the blank palettes provided by the heavy white impasto of her backgrounds, serve to highlight the coexistence of traditional femininity and strength in the modern identity of women.

01 Kelly Reemtsen, Dig It. 02 Kelly Reemtsen, Neat Freak. Photo courtesy of De Buck Gallery. [W debuckgallery.com kellyreemtsen.com]

points to advice clients. These former consultants are used to taking in multiple data points and already have the mega trends in technology, demographics and regulation on the backbone.

MORE COMPLEXITY IN THE LEADER ROLE Analytical skills are increasingly becoming a key competence for top leaders, and something you cannot outsource

become clarified. My job is to make a synthesis of what something in the external world means, if we are to invest billions and assess which risks and factors we need to take into account.” Knudstorp prioritizes spending half and whole days talking with experts, some of whom are part of his global network that spans a wide range of knowledgeable people from different areas. The Lego CEO not only listens but encourages debate in the company about the issues where people disagree. The “conflict” is the key to developing better ideas and decisions. Knudstorp is one of many new CEOs with a background in the management consultancy industry, where people are developing strong analytical skills taking into account a wide range of trends and data due to increasing market complexity and the information overload that requires the ability to ask the right questions and draw conclusions across multiple and highly specialized data input. The situation in Ukraine is a perfect example of the complex and interconnected market reality that most companies are highly influenced by. Top leaders must assess risks and opportunities in the short and long term in the Ukraine crisis, where the geopolitical battle between Russia and the EU/USA will impact key market conditions such as stock markets, interest rates, trade regulation, energy supply and resource allocation. Top leaders not on top of this situation will in the best case scenario be able to follow the crowd and in the worst case scenario become the ones negatively hit by the changes.

LEAD AND MANAGE: TWO MAGIC WORDS

Analytical skills can be considered part of managing the business, a technical skill as opposed to the soft leadership skills like empathy and two-way communication. While a leader may have core competences in either management or leadership, there is no way around the fact that today it is expected that top leaders will master both sides of the role. It is not a question about whether to lead or manage, but rather how to lead AND manage. The thirdgeneration CEO of Belgian shoe retail chain Schoenen Torfs, Wouter Torfs, modernized the old family business with a lot more of both leadership and management. He added strategy with five-year plans and bonus structures to the strong corporate culture founded by his grandparents, and he has over time introduced meditation at the annual strategy meeting and NLP-based coaching techniques. Wouter Torfs often shows up in the shoe shops on Saturdays to work side by side with the shop assistants. In this way he picks up new consumer trends and interacts with employees, who are otherwise spread out in shops all over Flanders, Belgium. Every shop is managed as a small business with a high degree of empowerment, while headquarters manages the brand and all back-office functions. This is one of the best workplaces in Europe and it is exactly because of the balance between efficient management and effective leadership that it continues to be recognized year after year and continues growing the business. Wouter Torfs is a credible leader, not just because he is an empathetic person who treats his personnel with lots of respect, but because he has shown how he can manage the business and ensure that people become part of the company’s success. Leaders need management systems, techniques and data to bring values, vision and mission into alignment with strategy, goals and action. People connect with leaders and a company when it makes sense what, how and why an organization does what it does. The leadership of one person should reflect the movement of an organization.•