GALT Consulting LLC

A pizza place emails out a coupon to it's preferred customers.  One customer gets the coupon and decides to eat at the restaurant... only they don't print out the coupon.  They arrive, order, eat and go to pay and show the coupon via their phone to their server, who rejects it.  The owner comes out and explains...  "If we didn't make you print the coupon, our wait staff would give away food to everyone who walked in."  The customer does not get the discount... and proceeds to tell the story to several people (including me). 

I understand why the owner made this decision, but that doesn't make it a good decision.  The owner doesn't have clear vision for what it takes to run a successful business.  I am not criticizing to complain, I am trying to make the point for you, so you don't make the same mistake. 

Businesses are made and lost on relationships.  Why?  Because it is far better to have a long-term relationship with a customer than to have to develop new relationships with total strangers.  The coupon incident was handled by an owner who expects every transaction to occur between strangers.  He sets a policy that shows his employees and customers that he doesn't trust them. 

Cost control is important in business, but relationships are more important.  NEVER do anything that signals a potentially valuable client that you are only interested in a relationship when every transaction is financially beneficial.  There are a lot of pizza places out there...

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If you want to see a powerful profile in Passion is Productive, you won't find a better example than my brother David.  Born with a condition that doctors reported would leave him unable to walk or talk, David has continuously beat the odds his entire life.  He is a major influence on my life and I am very proud of him!

This week, he is competing in the National Special Olympics in Lincoln, Nebraska representing Nebraska.  He is interviewed in the story linked below, and I think you'll catch a glimpse of that passion that has helped him his entire life!  It is worth the two and half minutes!

NEWS VIDEO OF SPECIAL OLYMPICS - JULY 18. 2010

OK... so it's not really new, but to those of you who have lived within (or even propagated) the "Top-Down Management" philosophy, this will seem new to you.  If you are wondering what is wrong with Top-Down Management, you need to read my article HERE.

What is the alternative to Top-Down Management?  The alternative is called People-Centric Management (first coined by my friend, former business owner and executive coach, Randy Mayes). 

People-Centric Management (PCM) revolves around the people within the organization rather than depending only on the management team.  Imagine all of the talents and strengths that exist within a typical organization.  I have been surprised many times in organizations where an employee suddenly emerges with a fantastic and incredibly useful skill that no one knew existed.  This is true everywhere.  Edwards Deming once said that the greatest waste in American industry is the unused talents of people.  This is the "hidden resource" in your company that PCM helps you to tap into.

I know what you are already thinking...  Are we going to vote on all decisions from now on?  How do I let my people run the organization when they can't even do their own jobs correctly?  If you are envisioning an organization run like a commune full of hippies, you aren't thinking quite right.

People-Centric organizations set a clear mission and vision for their organization.  They then empower their people to make decisions within the organization and within their own strengths and influence.  In this model, management doesn't have to solve all of the problems, they only have to make sure the vision is clear.  Here is how it works...

1) Engagement - Establish a culture where people can openly identify opportunities (which you probably call "problems").

2) Focus - Utilizing the "right" cross-functional team of experts (including management if needed), a team develops a plan for taking advantage of the opportunity presented (or "fixing the problem").

3) Accountability - The people set their own direction and then hold themselves accountable to that direction. 

4) Repeat

This cycle is repeated over and over again starting with the determination of an organizational strategy (called "People-Centric Planning" (TM)).  You will find organic change within your organization... in other words, with a clear vision and mission, you will start to see improvements occurring all over the place.  This eliminates the barrier of "selling the people" on change because the change just occurs from the people. 

Soon, I will tell you a true story of an organization that practices People-Centric Management and what that looks like...  it will blow your mind!

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For many decades now, the term "management has taken on a distinct meaning in our culture.  I recently conducted extensive research on the subject (aka: I Googled "Strong Management") and found one website that claims to help companies build strong management teams.  They define a manager this way...

"Manager - One who directs or conducts the affairs and interests of an entity such as a business; one who controls the direction and operation of such entity; one who brings about results."

Wow...  this definition would seem to be non-controversial and serves as the basis for many management education programs... and it is extremely damaging and leads to mediocrity.

I especially despise the last line...  "one who brings about results".  This is classic management philosophy that is known as Top-Down Management.

In Top-Down Management organizations, the boss develops the strategy and tactics, puts them on the tablets and then brings them down from the mountain to their workforce for implementation.  Management's role is to give directives and employee's role is to follow the directives.  Studies (such as those outlined in Jim Collin's book, Good to Great, show that this approach can work, but rarely leads to "great" companies).

Here are 4 reasons Top-Down Management isn't effective:
1) The organization is only as good as the management team
2) All change efforts have to start with getting employee buy-in
3) People are hardwired to be less motivated when they have no autonomy
4) The newer generation of workforce is less tolerant of it

So what is the alternative?  Stay tuned!

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I'm referencing a reference here, but in the book Trust Agents by Chris Brogan and Julien Smith, a study by anthropologist Robin Dunbar showed that people can realistically manage about 148 (give or take) real, authentic relationships at any one time.  As a business owner, your goal MIGHT be to be one of those 148 people for your clients.  Or maybe not...

When developing a strategy for your business, it is important to understand not only your Unique Value Proposition (UVP), but also to understand how people will connect with your UVP.  Your clients / customers may or may not require a "148 relationship", but you should not overlook the value in those relationships as potential connectors to your business.  Each of those 148 people has a relationship with up to 148 other people who take that person's advice very seriously.

What about the people outside of that 148?  They are very important too, but for different reasons.  For one thing, they probably hold opinions that directly impact your product.  My friend Matt Block recently wrote about this in his blog.  I have heard that for every customer that complains, there are 10 more who feel the same way who didn't make the effort to tell you.  As Jim Collins says in "Good to Great", you must "Confront the Brutal Facts".  Is your advertising working the way you thought?  What is your public image?  Listen to the masses to better understand your REAL UVP and learn where you need to make changes.

I've included one example in the picture above.  This sign was hanging in the downtown Springfield office of a friend of mine.  What are your clients saying about you?