#216: Find Your X-Factor
Good morning friends
Thank you for your generous comments and reflections marking the fifth anniversary of my coaching practice. Today, we’ll get straight to it.
/strategy
Last week, I introduced you to Verne Harnish’s Scaling Up.
You’ll remember he recommends business leaders focus on just four things – People, Strategy, Execution, and Cash – and advises that successful businesses do both strategic thinking and plan for strategic execution.
You’ll also remember Jim Collins counsels that powerful strategic thinking can’t happen once a year, or even quarterly, but should happen in a ‘strategic council’ of senior executives meeting weekly to explore, debate and decide.
When Ari Weinzweig and Paul Saginaw grappled with how to grow Zingerman’s deli business they met weekly for two years to develop their Zingerman’s Food Odyssey strategy.
Harnish tells us that J.D. Rockefeller had daily lunches with his Exco for a decade, each conversation further refining Standard Oil’s strategic thinking.
Thinking can’t be rushed, and execution must be planned.
Scaling Up identifies Seven Strata of Strategy, one of which is identifying your business’s X-factor, the thing that will give you a 10x-100x competitive advantage.
Your X-factor will typically address your industry’s pain points.
Ask yourself, what do you hate about your industry? Or, what inefficiencies does everyone accept as a ‘fact of life’? Finding the solution will help build your X-factor. It will also take time, so get that strategic council up and running.
Harnish tells the story of Outback Steakhouses. CEO, Chris Sullivan, knew that maintaining consistent food quality and service was critical for success. Yet, many large restaurant chains couldn’t get it right. His diagnosis was its cause was the short tenure of general managers. They stayed just six months in stores. This high turnover was accepted as ‘just the way it is’. Sullivan figured if he could increase tenure, he’d increase and stabilise quality.
He then designed a remuneration strategy designed to increase tenure. He crafted process to unblock the chokepoint.
New managers were asked to invest $25,000 at the start of their employment. They spent three years training under other managers, and then ran a restaurant on their own for two years. If they hit performance targets, they would get a $100,000 bonus which would vest over four years.
If they signed on at the same restaurant for another five years, they would get the $100,000 as a lump sum payment and $500,000 in stock that would vest over the following five years.
The result? 90% stayed for five years; 80% stayed for ten years or more and, at the point that Sullivan stepped aside, Outback was the most profitable restaurant chain in the US
The final provocation from Harnish is “The way to know if you have a strategy? Do you say ‘no’ 20 times more than you say ‘yes’ — no to the increasing number of opportunities coming your way; no to the wrong customers for your business model; no to nineteen of the twenty people wanting to work with you”.
Powerful for a business, powerful for the individual who finds themselves agreeing to meetings and projects that don’t align with their career goals.
//self
I thought these two statements were useful ones for our leadership journeys.
“Goals without routines are wishes; routines without goals are aimless. The most successful business leaders have a clear vision and the disciplines (routines) to make it a reality”.
And
“Ask a good manager about his team and he will speak in generalities, saying that they are hardworking, responsible, fun, etc. Ask a great manager the same question and she will describe each of her team members with specific details about their personality, strengths, and achievements”.
It is a crucial differentiation. Great leaders know their people and their strengths. They spend time helping them identify their strengths and steadily adapt their work roles so that 80% of their days are spent using their strengths. And they take the time to acknowledge good work knowing that positive attention is thirty times more powerful than focusing on negatives in creating high performance.
/// soul
Last month, I shared The New York Times 100 Best Books of the 21st Century. It was a great list with books that I added to my ever-growing list.
Last week, the founder of the brilliant Brittle Paper, Professor Ainehi Edoro-Glines critiqued the NYT’s list, pointing out only two books were by African authors.
It was a good reminder how easy it is to miss the obvious. I loved the list but didn’t ask ‘Who isn’t there that should be there?’
It is a powerful question that can and should be asked in all contexts. Her question immediately enriched my world.
To unlock our collective X-factor, we need diverse voices in the room and a context where people feel safe expressing themselves. Only when we can hear and hold multiple perspectives can we identify and overcome the obstacles that hinder our progress
Here are my favourite African reads of this century. I am not a critic nor an academic, so I can’t adjudge whether they’re the best, but they are the ones that I loved. I kept it to ten because I knew I wouldn’t get to 100. I’d love to know yours.
If you’d like to add some African reading to your list here is Brittle Paper’s 82 Anticipated African Books of 2024.
As a proud South African I would add Barbara Boswell The Comrade’s Wife and Kally Forrest’s Lydia as well as Namibian neighbour, Margie Orford’s Love and Fury.
If you’d like to go back in time, get your hands on these recently republished classics from the African Writers Series.
(Thanks to Nozizwe Vundla for sharing Edoro-Glines’s piece with us.)
All the best
Karl
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