The Institute of Directors in New Zealand have a book: “The Four Pillars of Governance Best Practice for New Zealand Directors“.
There’s some nice tight concepts in there. I wondered what would the “Four Pillars” for management be?
Below is my take – titled the “Four Pillars of Management Great Practice”.
Why “great practice”? For too many businesses “best practice” is an lofty standard that requires too much in time or money and doesn’t deliver greater benefit than the cost.
Great practice, on the other hand, is about practical and affordable practices that benefit any business.
The IoD’s Governance Four Pillars
- Determining purpose
- An effective governance culture
- Holding to account
- Effective compliance
Let’s translate that list for management.
Four Pillars of Management Great Practice
1. Translate the purpose into a clear vision and effective strategy for the business
While the directors may set the overall purpose – ‘why the organisation exists’ – it is the job of the executive team to translate that into an actionable plan of how that will happen, and how it will produce value for all stakeholders.
This answers two key questions of strategy: where do we play, and what are we going to do to win.
2. Lead and develop an effective culture
So many definitions of company culture out there… mine is very simple: culture is your values in action.
Culture is shaped and reinforced through many mechanisms, including the rituals and ceremonies, the stories and brand. It is lived out through the daily interactions and decisions, what things look and sound like, and how they are done.
- How do you want your staff to behave when no one is watching them? Culture.
- Want to ensure that your team are empowered and making great decisions? Culture.
Can we be intentional about culture? Research shows that the 80-90% of culture is driven by leadership behaviour.
So, how do you lead culture? Behave the same way you want your staff to. Live the values. Aspirational values on the wall that have nothing to do with “the real way things are done around here”, will not lead your culture.
Practical application: A starting place for building a great culture with an engaged workforce is to ensure that everyone is knows of, and is aligned to, the company strategic plan.
You can also see a great example in action at Hubspot – check out their culture code.
3. Be accountable and hold the team accountable
The executive team are accountable upwards, to the CEO and the board, for how well they have utilised the resources of the company to build stakeholder wealth.
The executive team are also responsible to hold their teams below them, and their teams below them, accountable for how well each of them has contributed value to the business.
This is much more than a performance management culture, it includes the organisational design and structure, whether or not the reward system encourages self-serving behaviour, how and when communication happens – feedback and recognition. And it involves the culture.
Practical application: One of the latest concepts in business leadership is “agile management”. It translates the benefits of Agile programming into management practice.
4. Execute the plan and operations
Executives… execute! They DO! They are responsible to get stuff done, run the business, deliver value to the customers and ultimately deliver value to the owners. That is a big responsibility, even in small businesses, with lots of decisions and choices. Do we hire or fire? Upgrade or not? Expand or reduce? Globalise or specialise? Merge or aquire…
Focus is vital. Steve Jobs told Walter Isaacson, in the Harvard Business Review article “The Real Leadership Lessons of Steve Jobs” that:
Deciding what NOT to do is as important as deciding what to do. – Steve Jobs
Practical application: the One Page Plan, which I mentioned above, is a great tool to help you get focus, clarity and execution. Simple in concept, but challenging to master.
Leaderkit now offers a training programme called “Riding Shotgun” where we work side by side with your leadership team to apply “management great practices”.
Call us to discuss. We love to talk and there is no pressure or obligation.
To wrap it up, the four pillars of management great practice are:
- Translate the purpose into a clear vision and effective strategy for the business
- Lead and develop an effective culture
- Be accountable and hold the team accountable
- Execute the company plan and operations
Thanks for reading – feel free to comment below. Do you agree, or would you have other pillars?