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Monday, May 23, 2016

Good Companies Often Hide From the Truth, Great Companies Look For It

The truth hurts. However, most people would agree that in order to get better at something, you must fully understand where and what you need to improve on… otherwise known as the brutal facts.

It’s not just anecdotally. In his National bestselling management book Good to Great, Jim Collins dedicates an entire chapter to “confronting the brutal facts”. Collins substantiates that in order for companies to become great, they must be willing to learn the truth about what they are doing well, and more importantly, what they could be doing better. In fact, it is only after companies do this that they are able to hit an inflection point and begin the breakthrough process towards greatness.

Collins goes on to cite examples of corporations such as Pitney Bowes and Kroger who did not shy away from the brutal facts, but instead embraced hearing the truth about areas they could do better in; no matter how painful it felt initially. In the case of Pitney Bowes, senior executives encouraged their employees to come forward and tell them directly all of the issues clients had complained to them about. They were unafraid of hearing some of the searing commentary because they knew they would be better for it. The leadership team at Kroger made the tough decision to re-strategize their entire business model because they did not shy away from the facts of the grocery store industry changing beneath their feet. The result? Surpassing their competitors and becoming one of the preeminent consumer stores of the late 20^th century (the book was published in 2001).

The organizations in Collins’ study that were deemed the most successful were ones who yearned to hear the brutal truth about their efforts while simultaneously having the conviction to know that they would be better for it. Why then, do so many people run from feedback on where they could be doing better?

In Anova’s experience, too often managers are worried the sales team and other members of their organization will resist the feedback if it is not positive. They decide to not collect data on how their company could improve because they are worried employees will view it strictly as an evaluation mechanism designed to judge their performance instead of a process to help them improve it.

On the flip side are companies that understand feedback does help. These companies seek the unbiased, unfiltered, “voice of the client” commentary on why their organization is winning and losing. These companies take the data collected, reflect on the findings, and implement real changes to try and fix potential issues. In 2015, 60% of Anova’s Win Loss Analysis clients saw a decrease in the frequency of mentions of their #1 area for improvement from the year before. These are organizations who have realized that in order to become more competitive, they must first hear what they could be doing better. These companies have accepted feedback as a major driver in organizational improvement. In the eyes of Jim Collins, these are great companies.

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