The Spreadsheet Manager Chapter Three: Initial Engagement

“H.D., I have Kathryn Dubois on the phone for you.”

“Thanks, Anna!”

Anna and H.D. had been together for about fifteen years. She moved with him every time he changed roles. He actually had it written into his non compete agreements that he was aloud to take her with him each and every time he transitioned. They were a great team; she knew exactly what support he needed to be the most effective and he treated her and her position with the highest level of respect. It was absolutely symbiotic.  H.D. knew that he couldn’t get a better assistant anywhere and Anna knew that many other senior executives would be tyrannical in their management approach.

H.D. picked up his office line, “Kathryn, its been years. How are you?”

“I’m doing well; the real question is: How are you?”

“Meh, I’ve been better. I’m running a new company now and I just let my Vice President of Operations go. Our competitors are kicking our butts and there doesn’t seem to be a light at the end of the tunnel.”

“Wow, that doesn’t seem like fun,” Kathryn responded, “What made you take the job? I know you can read a financial statement.”

Many moons ago, Kathryn and H.D. had been classmates in business school. H.D stayed in the sales and marketing realm while Kathryn had gravitated into operations consulting. An entrepreneur by nature, she started her own practice shortly after graduating. She didn’t personally handle engagements very often anymore as she gravitated more to executive team training and business development for her firm. This was a special situation and she knew that H.D. wanted her hands firmly on the reigns. He wouldn’t have contacted her if he didn’t.

 H.D. chucked,  “Yes, I know how to read a financial statement. I noticed there were problems with the company, but I met with the operations executive and he sold me on his ability to fix the problems and how well they were performing against existing measurements.”

Kathryn coyly said, “Interesting. I never pictured you as someone who was able to be sold. What happened?”

“He had a great deal of really interesting charts and he segued into showing how each part of the operations team was focusing on the issues that were relevant to their part of the puzzle. Everything he said made rational sense, but three months later, nothing had improved at all.”

“Firstly, let me ask you, how many measurements, targets or metrics had the previous VP set for his team?”

“They were slightly different for each site, but they were broken up into three basic categories:

1.      Performance Targets

2.      Leading Indicators

3.      Initiatives”

H.D. continued, “There are about ten performance targets for each site general manager. One of our sites has a small manufacturing/re-packaging facility attached to it so that GM has more than the rest.”

“OK, what about the leading indicators? Tell me more about them and how are they different from the performance targets that were set?”

“Well, this is all from an outsiders perspective, but there are another four or five indicators that are being measured and then they are reported throughout the network. I don’t think anyone is necessarily taking any action based on them, but I could be wrong. Maybe that’s the difference.”

“And the initiatives?” Kathryn asked.

“It looks like each GM was given a project to chair. The project completion is tied to their bonus plan. It doesn’t seem like any of them have been taken to completion.”

“This is a little beyond scope, but just so I can see what we are dealing with, are all of the GMs on the project teams?”

“That’s a good question. Standby.”

H.D. rustled through some papers and responded, “Actually, yes. I’m looking at a project charter for each one of the initiatives and every GM sits on every other initiatives team and is the project chair for their initiative. I don’t understand why that’s important.”

Kathryn responded, “I don’t want to get to deep into the weeds right now, but, generically, if there are five GMs and each site has ten to fifteen measurable to attack, chair one project and accountable for four other projects, how much work do you think that each GM will get done on any one item?”

“OK, that makes sense, so what do we do then?”

“Well, you had a great deal of success running sales and marketing for different companies and, I’m assuming, prior to that, you had a great deal of success as an individual contributor. What were you doing to be successful? In each of those roles?”

“Interesting question. In my early career, as a territory manager. I was the king of new business. I was constantly calling on new accounts and revisiting prospective accounts that turned me down. I actually started tracking how many cold-calls I made per month. I knew I had to get around sixty cold calls a month to get 1-2 new accounts. I set a goal to hit sixty every month without fail.”

Kathryn said, “So did you apply that mentality when you were managing a sales force?”

“Yes, I did.”

“How did that work out for you?”

“Well, not so well actually.”

“Hmm.” Kathryn remarked, “And why was that?”

“Well, I would take an underperforming sales person and set a target for cold-calls per month and started to track them on their progress against that specific target.”

“How many of them hit their target?”

“Most of them. However, the performance wasn’t there.”

“Interesting. So what did you do?”

“Well it took me a few years realize this, but some of my team just wasn’t going to make it. I started structuring my compensation plans to drive growth. My marketing manager and I realized we needed new business because our ‘pipeline was drying up.’ I offered triple commission for the first year of new business. You would be surprised how much growth we drove that year. We elected to keep the new compensation plan in place permanently and never had a problem again.”

“Were you still tracking cold-calls at this point,” Kathryn asked.

“Yes we were.”

“Well, what happened to the cold call volume?”

“Nothing really. They stayed about the same.”

“Hmmm. Why do you think that is?”

“I cant say for certain, but it seemed like before that the team was just going through the motions so they could hit their cold call target. Its almost like their heart wasn’t in it.”

Leadership Learnings: All metrics, regardless of form, fit or function can be gamed by a savvy employee.

“So, long term what did you end up doing? How did you manage your sales team going forward.”

“Well I set two targets for each one of my sales managers. Firstly, I set a growth target. Secondly, I set a new business target. I didn’t want the sales team trying to squeeze volume from existing customers so I more heavily weighted the incentive packages towards new business.”

Kathryn scribbled some notes on here pad and continued, “OK, I’d love to swap war stories all day long, but I have another call to get on.”

“So what are our next steps?”

“We need to pull together the operations team for a meeting. I need you to be there for the first two or three hours on day one and The rest of us will have an additional second day. “

“How fast can we get started?”

“I have next Thursday and Friday open on my schedule for you.”

“OK. I will pull all five GMs together. Anna will be in touch with travel arrangements. Let her know what you need.”

Kathryn quipped, “You know that I’m going to hit you for double time to expedite this.”

H.D retorted, “I wouldn’t have it any other way!”

“H.D., I have Kathryn Dubois on the phone for you.”

“Thanks, Anna!”

Anna and H.D. had been together for about fifteen years. She moved with him every time he changed roles. He actually had it written into his non compete agreements that he was aloud to take her with him each and every time he transitioned. They were a great team; she knew exactly what support he needed to be the most effective and he treated her and her position with the highest level of respect. It was absolutely symbiotic.  H.D. knew that he couldn’t get a better assistant anywhere and Anna knew that many other senior executives would be tyrannical in their management approach.

H.D. picked up his office line, “Kathryn, its been years. How are you?”

“I’m doing well; the real question is: How are you?”

“Meh, I’ve been better. I’m running a new company now and I just let my Vice President of Operations go. Our competitors are kicking our butts and there doesn’t seem to be a light at the end of the tunnel.”

“Wow, that doesn’t seem like fun,” Kathryn responded, “What made you take the job? I know you can read a financial statement.”

Many moons ago, Kathryn and H.D. had been classmates in business school. H.D stayed in the sales and marketing realm while Kathryn had gravitated into operations consulting. An entrepreneur by nature, she started her own practice shortly after graduating. She didn’t personally handle engagements very often anymore as she gravitated more to executive team training and business development for her firm. This was a special situation and she knew that H.D. wanted her hands firmly on the reigns. He wouldn’t have contacted her if he didn’t.

 H.D. chucked,  “Yes, I know how to read a financial statement. I noticed there were problems with the company, but I met with the operations executive and he sold me on his ability to fix the problems and how well they were performing against existing measurements.”

Kathryn coyly said, “Interesting. I never pictured you as someone who was able to be sold. What happened?”

“He had a great deal of really interesting charts and he segued into showing how each part of the operations team was focusing on the issues that were relevant to their part of the puzzle. Everything he said made rational sense, but three months later, nothing had improved at all.”

“Firstly, let me ask you, how many measurements, targets or metrics had the previous VP set for his team?”

“They were slightly different for each site, but they were broken up into three basic categories:

1.      Performance Targets

2.      Leading Indicators

3.      Initiatives”

H.D. continued, “There are about ten performance targets for each site general manager. One of our sites has a small manufacturing/re-packaging facility attached to it so that GM has more than the rest.”

“OK, what about the leading indicators? Tell me more about them and how are they different from the performance targets that were set?”

“Well, this is all from an outsiders perspective, but there are another four or five indicators that are being measured and then they are reported throughout the network. I don’t think anyone is necessarily taking any action based on them, but I could be wrong. Maybe that’s the difference.”

“And the initiatives?” Kathryn asked.

“It looks like each GM was given a project to chair. The project completion is tied to their bonus plan. It doesn’t seem like any of them have been taken to completion.”

“This is a little beyond scope, but just so I can see what we are dealing with, are all of the GMs on the project teams?”

“That’s a good question. Standby.”

H.D. rustled through some papers and responded, “Actually, yes. I’m looking at a project charter for each one of the initiatives and every GM sits on every other initiatives team and is the project chair for their initiative. I don’t understand why that’s important.”

Kathryn responded, “I don’t want to get to deep into the weeds right now, but, generically, if there are five GMs and each site has ten to fifteen measurable to attack, chair one project and accountable for four other projects, how much work do you think that each GM will get done on any one item?”

“OK, that makes sense, so what do we do then?”

“Well, you had a great deal of success running sales and marketing for different companies and, I’m assuming, prior to that, you had a great deal of success as an individual contributor. What were you doing to be successful? In each of those roles?”

“Interesting question. In my early career, as a territory manager. I was the king of new business. I was constantly calling on new accounts and revisiting prospective accounts that turned me down. I actually started tracking how many cold-calls I made per month. I knew I had to get around sixty cold calls a month to get 1-2 new accounts. I set a goal to hit sixty every month without fail.”

Kathryn said, “So did you apply that mentality when you were managing a sales force?”

“Yes, I did.”

“How did that work out for you?”

“Well, not so well actually.”

“Hmm.” Kathryn remarked, “And why was that?”

“Well, I would take an underperforming sales person and set a target for cold-calls per month and started to track them on their progress against that specific target.”

“How many of them hit their target?”

“Most of them. However, the performance wasn’t there.”

“Interesting. So what did you do?”

“Well it took me a few years realize this, but some of my team just wasn’t going to make it. I started structuring my compensation plans to drive growth. My marketing manager and I realized we needed new business because our ‘pipeline was drying up.’ I offered triple commission for the first year of new business. You would be surprised how much growth we drove that year. We elected to keep the new compensation plan in place permanently and never had a problem again.”

“Were you still tracking cold-calls at this point,” Kathryn asked.

“Yes we were.”

“Well, what happened to the cold call volume?”

“Nothing really. They stayed about the same.”

“Hmmm. Why do you think that is?”

“I cant say for certain, but it seemed like before that the team was just going through the motions so they could hit their cold call target. Its almost like their heart wasn’t in it.”

Leadership Learnings: All metrics, regardless of form, fit or function can be gamed by a savvy employee.

“So, long term what did you end up doing? How did you manage your sales team going forward.”

“Well I set two targets for each one of my sales managers. Firstly, I set a growth target. Secondly, I set a new business target. I didn’t want the sales team trying to squeeze volume from existing customers so I more heavily weighted the incentive packages towards new business.”

Kathryn scribbled some notes on here pad and continued, “OK, I’d love to swap war stories all day long, but I have another call to get on.”

“So what are our next steps?”

“We need to pull together the operations team for a meeting. I need you to be there for the first two or three hours on day one and The rest of us will have an additional second day. “

“How fast can we get started?”

“I have next Thursday and Friday open on my schedule for you.”

“OK. I will pull all five GMs together. Anna will be in touch with travel arrangements. Let her know what you need.”

Kathryn quipped, “You know that I’m going to hit you for double time to expedite this.”

H.D retorted, “I wouldn’t have it any other way!”