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Saturday, August 2, 2008

Executive Transition: The First 90 Days

According to Harvard Business School professor Michael Watkins, an executive gets 90 days (three months) to move from a value consumer (costing the organization) to a value creator (value added)—and thus hit the breakeven point. The faster this transition takes place the better off the organization is and the more likely the transitioning executive is to be successful. In fact, the failure rate for senior executive outside hires into a company is a whopping 40-50%, at a cost of $2.7 million per executive in both direct and indirect costs. Watkins does an excellent job setting up a new executive to succeed. He uses ten steps (PAMS-NAB-CRE)—I need mnemonics to help me remember things. Here’s the top line view of the book—but it’s the details of the how-to’s that will make a difference, so read the book—at least skim it.
1. Promote yourself: Don't get stuck trying to do your old job. Let go and move on and don't assume what got you here will get you there (what Marshall Goldsmith's latest best seller is all about).
2. Accelerate your learning: Get systematic and focused about learning first things first (akin to what Stephen Covey also suggests)
3. Match strategy to the situation: Diagnose whether the new challenge for the transitioning executive involves a Start up, Turnaround, a Reorganization, or Sustaining Success (STRS). This is a critical distinction make by the author.
4. Secure early wins: Grab the low hanging fruit of success to set the tone of a successful tenure with virtuous relationships and not vicious ones (John Kotter—a Harvard Professor and change icon talks about this a lot in hit books on change, including Leading Change).
5. Negotiate success: Your new boss is your critical connection to the organization. Understanding and meeting his or her needs and expectations, style and energy is important if only for survival purposes! Get consensus on your 90 day plan and life will be a better place.
6. Achieve alignment: As a high flyer in an organization, you need to assure alignment with your approach and the corporate strategy (Covey chats about this a lot in his later books).
7. Build your team: Most new executives inherit teams. The key is to keep the right ones and jettison the wrong ones (remember Good to Great—Jim Collins research taught us to get the right people on the bus and the wrong ones off it).
8. Create coalitions: Whether it's Survivor, prison or the corporate boardroom, you need to figure out your critical supporters early on to survive and thrive. Don’t ever forget both peers and subordinates as critical to your success.
9. Keep your balance: Change causes stress, which causes imbalance. Trying to stay true to core relationships is important—family, work and yourself. To me the old serenity prayer holds true here—God grant me the courage to accept the things I cannot change; to change the things I can; and the wisdom to know the difference.
10. Expedite everyone: Again—you live in a 360 world surrounded by a living organism called the company. It’s your primary job to adapt to the corporate culture. On the other hand, people around you will also be adjusting—help make it easy for them, especially make it easy for them to like you and see you as part of the organism and not a threat to it. Remember what organisms do when they feel threatened--they form antibodies and reject the new cell!
This book is worth a read when you’re an executive in this situation. It’s definitely worth showing to the head of HR, to a senior partner, and to the CEO. Like Woody Allen says, “Money is important if only for financial reasons!”

PS To remember the process—PAMS -NAB-CRE—think of a bunch of PAMS about to NAB a CREature. Hey, it was the best I could do on short notice!

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