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The X Factor ONE
THERE WERE several studies done by management consultants in Europe in the late 1940s and early 1950s comparing the output of British automobile manufacturing plants to those of West German plants. What they found was that the most efficient German auto manufacturing plants were outproducing the British plants by as much as four to one. At first, the British researchers blamed the disparity on the fact that the German plants were all new, having been rebuilt after World War II, while most of the British plants were old and still using machinery from the 1930s.
To test this theory, they compared new British plants to new German plants that were each manufacturing the same size of car, each with a unionized workforce, and each using the same technology and materials. They found that between the best-managed and worst-managed plants in both countries, there was still a production difference of four to one.
This productivity difference, which could not be explained by material or technical factors, became known as the "X factor." The discovery of the X factor, now called the psychological factor, led to a revolution in management that has taken place in the last sixty years throughout the free world.
Up until the Great Depression of the 1930s, almost all advances in management were a result of advances in technology, science, and production processes. Since World War II, most of the great advances have been managerial and psychological in nature. The X factor explains more than anything else why some companies succeed and others fail, why the top 20 percent of companies in every industry earn 80 percent of the profits, and why the most talented people are drawn to the best companies.
By tapping into the psychological factors that determine performance and productivity, you can make a dramatic difference in your effectiveness as a manager and in your ability to get results.
The Command Center
The psychological factor really comes down to a very simple point: the self-concept. The discovery of the self-concept is perhaps the most important breakthrough in the development of human potential in the twentieth and twenty-first centuries.
The self-concept is the belief structure or value system of the individual. It forms and develops from early childhood and is a composite of all of the emotions, experiences, decisions, education, and events of a person's life up to the present day. The self-concept determines how a person thinks about himself, feels about himself, and sees himself relative to the rest of the world.
The self-concept is like the command center that sits at the core of personality and productivity. It is what governs individual performance, behavior, and output. All changes or improvements in external performance and behavior begin with improvements in the self-concept; to put it another way, all changes in the outer world of the individual begin with changes in the inner world.
The Self-Concept and Performance
The self-concept is made up of three components: the self-ideal, the self-image, and the self-esteem. Let's take each of these in order.
The individual's self-ideal is a summary picture of what the person aspires to be in life. It is made up of the goals, dreams, hopes, and ideals that the person has about himself and what is possible for him to become at some time in the future.
In the world of work, the individual's self-ideal is influenced by corporate values, the role models represented by the senior people in the organization, and the corporate culture surrounding employees.
The second part of the self-concept is the self-image. This is the way a person thinks she is viewed by others. People who see themselves as likable, confident, and competent will tend to do a much better job than people who see themselves as not particularly good at their work.
Your self-image is greatly influenced by the way people treat you daily. When people are treated as though they are valuable, important, and respected, they see themselves and think about themselves in a more positive way. As a result, they perform at higher levels and do better work.
The third part, and the core of the self-concept, is the individual's level of self-esteem. Self-esteem can be defined as "how much you like yourself." The more people like and respect themselves on the inside, the better they perform on the outside: They set bigger goals for themselves and higher standards for the quality of their work; when people like themselves, they also like other people more and become excellent team players.
The self-esteem is the "reactor core" of the human personality and largely determines the individual's level of energy, enthusiasm, vitality, and self-confidence.
The key to creating a peak performance organization is to create an environment of high self-esteem by removing the fears of failure and rejection that inhibit personal performance. The manager who creates a positive, high-self-esteem workplace will have higher performance, lower absenteeism, lower employee turnover, higher productivity, and fewer mistakes.
The Role of the Manager
There are seven ways that the manager can build and reinforce a positive self-concept in each employee. These practices align with seven motivators:
1. Challenge. Give people jobs that make them stretch. The more challenge that people experience in their work, the more engaged they will be and the more positive they will feel about themselves.
2. Freedom. Give people sufficient autonomy to work without close supervision. The more freedom that they have to get the job done on their own, in their own way, the better they feel about themselves.
3. Control. Set regular times for review, feedback, and discussion of the work. The more regular feedback that employees get on their performance, the better they feel about themselves and the more valuable they consider their work to be.
4. Respect. When you ask for people's opinions, and listen closely to them when they want to talk, they feel more valuable and important. By listening attentively and carefully considering the opinions of others—even if you, as manager, do not act on their input—you demonstrate that you respect the uniqueness of each person.
5. Warmth. The more your people see that you like and care about them as individuals, in addition to members of the staff, the better they will perform. By treating your people as though they are your friends and natural extensions of your corporate "family," you make them feel safer, more secure, and more important.
6. Success Experiences. A key to self-esteem and self-concept building is to give people jobs that they can perform successfully at their levels of experience and skill. When they complete a task, recognize and acknowledge that achievement, both privately and publicly, so that people feel like "winners."
7. Positive Expectations. This is perhaps the most powerful motivator of all. Nothing boosts self-esteem and improves performance more than when people sense that their boss believes that they are good and competent and that they have the ability to do the job well.
Successful companies are those that create an environment where people feel terrific about themselves. Understanding the role of the self-concept in behavior is the starting point of effectiveness in management and motivation.
1. Make it a habit to treat your individual staff members as though they are valuable, important, intelligent, and competent. Look for every opportunity to build their self-esteem and self-confidence in every interaction with them.
2. Tell your staff members continually how good they are, and how impressed you are with the quality of their work. When you confidently expect people to perform at high levels, they will seldom disappoint you.
Select the Right People
SELECTING THE RIGHT people is the starting point of excellence in management. Probably 95 percent of your success as a manager resides in your ability to select the right people in the first place. If you hire the wrong people, then no matter what you do, what techniques you use, or what efforts you put in, it is not going to make very much difference. Almost all of your problems as a manager come from either selecting the wrong people or inheriting the wrong people in your position.
In his book, Good to Great, Jim Collins suggests that, essentially, the first job of management is to "get the right people on the bus, get the right people into the right seats on the bus, and then get the wrong people off the bus."
When Lee Iacocca was brought in to save Chrysler Corporation, it was on the verge of bankruptcy. After securing a $350 million loan guarantee to keep Chrysler operational until he could turn it around, Iacocca went methodically through the senior management of Chrysler, replacing thirty-five out of thirty-six vice presidents over a three-year period. By the time he was finished, he had completely restaffed the upper ranks of Chrysler Corporation with highly skilled and experienced car executives from all over America and around the world.
With the right people in the right places, Chrysler underwent a remarkable turnaround, transforming losses into profits. In less than three years, Iacocca completely repaid the $350 million loan guarantee and put Chrysler Corporation back into the black.
Think Through the Job
Hiring the right people in the first place is the key to managerial success. Begin by thinking through the job carefully, preferably on paper. Write out a list of all of the characteristics and qualities that you would want in the ideal person for a particular job. First, focus on the specific, measurable results and outcomes that you expect the new employee to achieve.
The second factor you look for is the set of basic skills that the person will have to have to get the results that the job requires. Interview carefully to make sure that the candidate has demonstrated in the past the skills you've identified for the job. As Peter Drucker said, "Only past performance is an accurate predictor of future performance."
Finally, hire as much for attitude, personality, and character as you do for job skills. Make sure that the new person will fit in comfortably with your company culture and work well with yourself and others. If you select people with the right attitude and personality, you can train and manage them to do the job well.
The Law of Three
With the Law of Three, you can increase your ability to make good hires. In fact, your success rate can be as high as 90 percent, based on my experience with thousands of executives and business owners. Here is how it works, in six steps.
First, interview at least three candidates for a job. This practice forces you to slow down and compare and contrast the qualities and characteristics of different people. Second, interview the candidate that you like three different times. Remember, a job candidate will look the very best on the first interview. After that, there is a gradual deterioration as the screens fall away and the true person is revealed.
Third, interview the person you like in three different places. For some reason, many people have what I call a "chameleon complex." They appear a certain way in your office in the first interview and then seem to act and react differently when you move them into different environments.
Fourth, have any candidate that impresses you interviewed by at least three other people on your team. In too many cases, a candidate that I considered to be ideal was roundly rejected by my team and, as it turned out, for good reason.
Check References Carefully
Fifth, check at least three references from the candidate. Because of the fear of lawsuits, most employers will only give you the dates of employment of the candidate. But there are still questions that you can ask to glean useful information. When you call, say something like, "We are interviewing this person for this particular job, doing these particular activities, and having these particular responsibilities." You can then ask specific questions such as:
1. Could you tell me some of the strengths or weaknesses that this candidate would have in performing a job like this?
2. Is there anything you could tell me that would help me to make a better hiring decision?
3. Would you hire this person back again if he applied to you for a job?
If the reference is reluctant to comment on the candidate or won't answer questions 1 and 2, always ask question 3, which is the key question. If the answer is not an unequivocal "yes," you should be very cautious about hiring the candidate in the first place.
The sixth and final piece of advice is to check references three deep. That is, ask the given reference for the names of other people the candidate has worked with, so you can talk to those people, too. When you interview three additional people whose names do not appear on the candidate's resume, you may be surprised at what you learn.
Many executives have told me that this Law of Three has significantly improved the quality of the people they have hired and the effectiveness of the entire team.
The SWAN Formula
The SWAN formula was recommended some years ago by an executive recruiter named John Swan. It is a good acronym that you can use to improve your selection process. It has four letters: S, W, A, N.
S stands for smart. Hire smart people. How do you tell the intelligence of a candidate? The answer is simple. Questions! Intelligent people tend to be more curious than average people.
The W in the formula stands for "work hard." Look for people who are willing to work hard and who have backgrounds that indicate that they have worked long, hard hours—including evenings and weekends—at previous jobs.
The A stands for ambition. The proper candidate is someone who wants to move ahead in life. Ambitious people are willing and eager to take additional training; they are already reading and studying and seeking opportunities to grow, both personally and professionally.
Finally, N stands for people who are "nice." The likability of the candidate is a critical factor, and this quality is especially important for people who have to deal with the public or with customers of any kind. As Leona Helmsley once said in her advertisement for her hotel chain, "We don't hire people and train them to be nice; we just hire nice people."
In the final analysis, your ability to pick the right people for your team is the key to motivation. You cannot hire the wrong people and then expect to motivate them to be excellent performers for your team. It is much better that you proceed carefully and painstakingly and hire the right people in the first place.
1. Identify the qualities of the best people on your team today. What can you do to be sure to hire more of them in the future?
2. The next time you hire someone, practice the Law of Three exactly as it is described in this chapter. After you have done it once from beginning to end, you will use this technique repeatedly in the future.
Start Them Strong
IN A THIRTY-YEAR research project, accounting firm Deloitte & Touche studied thousands of its employees, starting with the initial hiring process and then following employees' track records through the years in an attempt to determine the factors that would most predict high performance in the long term. What the researchers found was quite interesting.
First, they discovered that self-selection was a vital factor in predicting subsequent performance. The term "self-selection" refers to employees who had more than one choice of an employer. After interviewing with other companies, these employees, who were obviously talented since they were in consideration for a job at such a prestigious firm, came back to Deloitte & Touche and said very emphatically, "I want to work here."
In other words, they had decided for themselves that Deloitte was the best company that they could work for, and they were determined to get that particular job. Even many years later, the self-selected employees were still doing a better job and performing at a higher level than people who were less enthusiastic at the beginning.
Load Them with Work
The second factor they discovered, and the focus of this chapter, was that the managers of high performers started them off strong with lots of work, even an overload, from the very first day of employment.
Excerpted from Motivation by BRIAN TRACY. Copyright © 2013 by Brian Tracy. Excerpted by permission of AMACOM.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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1 The X Factor.................... 6
2 Select the Right People.................... 12
3 Start Them Strong.................... 18
4 Communicate Clear Expectations................... 23
5 Practice Participative Management................ 28
6 The Four Factors of Motivation................... 34
7 The Three Rs.................... 40
8 Install Management by Values.................... 46
9 Practice Management by Objectives................ 52
10 Use Management by Exception.................... 57
11 Apply the Pareto Principle.................... 61
12 Be a Teacher.................... 67
13 Train and Educate Continuously.................. 71
14 Insist on the Zero Defects Principle............ 76
15 Introduce Quality Circles, Quality Teams........ 82
16 Practice Brainstorming Regularly................ 87
17 Become a Mentor.................... 93
18 Lead by Example.................... 98
19 Listen to Your Staff.................... 103
20 Remember the Friendship Factor.................. 109
21 Create Motivational Magic.................... 114