FROM LUFTMENSCH TO ACTION!
Action is the process of doing. That’s what this chapter is all about. Gaining traction means making your vision a reality. At this moment, your vision is crystal clear, you have the right people in the right seats, you’re managing data, you’re solving your issues, and you’ve defined your Way of doing business and everyone is following it. Now you’re ready to master organizational traction, the final piece of the puzzle. Mastering the first five components was essential before tackling this component, because without them, you might gain traction, but in the wrong direction. When the first five components are strong, you will take off in the right direction—toward your vision.
The ability to create accountability and discipline, and then execute, is the area of greatest weakness in most organizations. If I asked you to rate the level of accountability in your organization on a scale of 1 to 10, with 10 being your perfect level of accountability, how would you rate it? Successful leaders rate themselves high because they know how to gain traction. When meeting with the average new client for the first time, though, they typically rate their current accountability at 4.
This is a real shame, because the world is filled with many great visions. Unfortunately, most will go unrealized due to an inability to gain traction. Visionaries like to stay on a high plane, not at ground level. After more than 20 years of observing failures, I realized how to bridge the gap between vision and execution.
I recently learned a word that makes the point. Luftmensch is a Yiddish word made from two others; luft means “air” and mensch means “person.” A luftmensch is an “air-person,” someone who has his or her head in the clouds. I don’t mean this as an insult. Ideas come from having your head in the clouds. Most visionaries would agree with me. That is their gift, their strength, and their value. Nothing exists without visionaries. Yet once the vision is clear, you need to go from luftmensch to action.
Most leaders know that bringing discipline and accountability to the organization will make people a little uncomfortable. That’s an inevitable part of creating traction. What usually holds an organization back is the fear of creating this discomfort. But you don’t have any other option if you want to build a great company. If you can accept the fact that you’re going to make people a little uncomfortable for a short time, the solution is actually straightforward. You need to implement two simple practices.
As with all the steps along the way, this one requires a total commitment from the leadership team. There will be far too many opportunities to pull back and retreat. If your leadership can stay the course, however, within months your people will appreciate the increased accountability, improved communication, and solid results. The discomfort you were concerned about turns out to be not nearly as bad as you thought. And truth be told, the people who continue to resist are either the wrong people or in the wrong seat.
This is one of the secrets to the EOS methodology: We don’t let leadership teams turn back. For that, they eventually thank us and say they don’t know how they could previously have lived without this high level of traction, accountability, and results.
What are the two disciplines needed to gain traction? First, everyone must set specific, measurable priorities. Second, you must meet better as an organization. These two essentials are called: Rocks and a Meeting Pulse.
Before we dig deeper into each of the disciplines, I offer some before-and-after statements from clients that have fully implemented these traction tools. You or your people may relate to them.
BEFORE TRACTION
No Accountability
• “I really didn’t know who I was accountable to.”
• “Although we agreed to meet on a regular basis, in actuality we didn’t. We lacked accountability and focus.”
• “Before Rocks, there was no clarity.”
Poor Communication
• “I felt alone in my understanding of what was needed in the company. I also was misunderstood.”
• “I’ve worked here for over 20 years, and before Rocks, I was never in the loop.”
Stagnation
• “We were fairly disciplined about creating one-year goals, but would frequently find ourselves at the end of the year having made no substantive progress toward those goals. It was tough to stay focused on them throughout the year.”
• “We had no clear direction or priority. Everything was important, and as a result our efforts were not directed where they were most effective. ‘We suffered from the classic ‘show up and work for work’s sake.’”
• “Everything was a priority.”
Chaos
• “It was tough to get out of the day-to-day emergencies and focus on the most important priorities.”
• “We didn’t meet very often. Coming to a decision could take weeks, and we always had to re-present the information.”
• “Things slipped through the cracks.”
• “No structure, lack of communication around goals and issues. Problems were not resolved, and they just stacked up. We had no method to measure results.”
• “We were very reactionary, dealing with the problem of the week or month.”
• “It was not clear whose job was whose, so I always felt everything was on my shoulders and I had to do it all.”
AFTER TRACTION
Accountability
• “After Rocks, everyone on the team has responsibility, clarity, and timing on what has to get done. Also, each team member is clear on his or her accountability. Everyone is on the same page.”
• “I see us now working more as a cohesive unit with purpose and direction. We are working toward closure with issues, employee accountability, and job responsibilities. We now have some organization with a focus on what we do best.”
• “With the Rocks and Meeting Pulse in place, I feel the ability for me and my team to focus better on the big-picture items. More is getting done in the same amount of time, and we have a heightened sense of urgency to get things done by certain due dates.”
Communication
• “The meetings are 90 minutes and no longer. It’s taking time, but I can now see the benefits of having weekly meetings as opposed to monthly.”
• “Now at least with the Rocks and weekly meetings, I get a sense of priority, and I know what direction the company is going.”
• “The Meeting Pulses have really served as an excellent communication vehicle to cascade messages within our rapidly changing environment.”
Organization
• “Rocks gave me a way to check in with my reports and drive better results in a highly consistent manner.”
• “Life after Rocks is very rewarding! All players are on the same page. We are focused toward a common goal. There is clarity in both expectations and direction. We can clearly identify weak performers and those that do not fit within our organization. Truly, it is like night and day!”
• “Rocks keep everyone focused, and allow us to work toward one-year goals in bite-sized chunks. Rocks have become the measurable and the lingo of our organization. We see employees seriously approaching their Rocks with a sense of pride and commitment.”
Traction
• “Now I feel that the forward momentum is turbocharging our organization by getting everyone to help row the boat.”
• “With Rocks, we have found the way to achieve goals, hold people accountable, and move in a positive direction on a continuous basis.”
• “Now we are getting ahead of the problems and pushing into prediction and working on our systems. We have more time to work forward, not deal with past problems.”
With a clear long-term vision in place, you’re ready to establish short-term priorities that contribute to achieving your vision. You will establish the three to seven most important priorities for the company, the ones that must be done in the next 90 days. Those priorities are called Rocks.
One of our students at the sales training company illustrated the power of setting 90-day priorities. In the days when his family picked cotton by hand, the student said he would stand at the foot of the field, look out at the acres and acres of cotton, and feel overwhelmed by the work that needed to be done.
To make the prospect of picking all those acres less overwhelming, someone would pick up a stick and throw it as far as he or she could. Then everybody would just put their heads down and “pick to the stick.” When they got there, they’d pick up that stick, throw it out again, and repeat the process.
That’s why you create a 90-Day World. Rather than be overwhelmed by the monumental task of accomplishing your vision, this allows you to break it down into bite-size chunks called Rocks and focus on making it to the stick.
Your company will have Rocks, each member of your leadership team will have Rocks, and your employees will also have Rocks. The reason to limit Rocks to three to seven (preferably closer to three) is that you’re going to break the organization of the habit of trying to focus on everything at once. It simply can’t be done. By limiting priorities, you can focus on what is most important. With the increased intensity of focusing on a limited number of Rocks, your people will accomplish more. Remember the old saying: When everything is important, nothing is important. The way you move the company forward is one 90-day period at a time.
Rocks create a short-term focus similar to the point I raised earlier from Al Ries’s book Focus. To the degree that you focus everyone in one direction, you’ll gain the power of that laser beam, gaining traction toward your goals.
Once your vision is clear, you will set better Rocks. Setting these priorities becomes simple. Once you set the company Rocks and then the leadership team’s Rocks, you then communicate these Rocks to the entire organization so they can set theirs. This process creates alignment. The exact process for establishing Rocks as a team and then rolling out this process organization-wide will be explained in this chapter.
By the way, it doesn’t matter what you call these priorities; however, most companies really like calling them Rocks. I learned the term from Verne Harnish, the author of Mastering the Rockefeller Habits. Verne got it from an analogy in Stephen Covey’s book First Things First. Picture a glass cylinder set on a table. Next to the cylinder are rocks, gravel, sand, and a glass of water. Imagine the glass cylinder as all of the time you have in a day. The rocks are your main priorities, the gravel represents your day-to-day responsibilities, the sand represents interruptions, and the water is everything else that you get hit with during your workday. If you, as most people do, pour the water in first, the sand in second, the gravel in third, and the rocks last, what happens? Those big priorities won’t fit inside the glass cylinder. That’s your typical day.
What happens if you do the reverse? Work on the big stuff first: Put the rocks in. Next come the day-to-day responsibilities: Add the gravel. Now dump in the sand, all those interruptions. Finally, pour the water in. Everything fits in the glass cylinder perfectly; everything fits in your day perfectly. The bottom line is that you need to work on the biggest priorities—your Rocks—first. Everything else will fall into place.
Less is always better, and a few priorities are better than many. Do less, accomplish more. Most organizations start out the year with a huge ball of priorities and get very little done by the end of the year. By coming up with Rocks every quarter, you create a 90-Day World.
The process works like this: Your team meets for a full day every 90 days. You review your vision, and then determine what the Rocks are for the organization for the next 90-day period to keep you on track for your vision.
ESTABLISHING YOUR ROCKS
STEP 1
After reviewing your V/TO and getting on the same page, your leadership team lists everything on the whiteboard that has to be accomplished in the next 90 days. On average, you’ll discover about 10 to 20 things that you’d like to close out, although one client came up with 75.
STEP 2
With that list of 10 to 20 items in front of you, discuss, debate, and determine the most important priorities for the company in the next 90 days. Make a decision on each one whether to keep it, kill it, or combine it as a company Rock for the quarter. You make as many passes at the list as necessary until you’re down to three to seven. As a result, the right ones will rise to the top.
STEP 3
Once you’ve narrowed your list, set the date that the Rocks are due. This is typically by the end of the quarter (i.e., March 31, June 30, September 30, and December 31). Now define each one by making sure the objectives are clear. This is vital.
A Rock is specific, measurable, and attainable. For example: “Close three core accounts” or “Hire a new controller.” A Rock is not a to-do that is open-ended or vague. “Start working on the Customer Service Process” is not specific, measurable, and attainable, and is therefore not a good Rock.
A Rock must be clear so that at the end of the quarter, there is no ambiguity whether it was done or not. Here is an example of four company Rocks that were set and defined:
Company Rocks due by March 31
1. Close $1 million in new business
2. Document delivery process and train all
3. Narrow CFO candidates to two
4. Implement new information systems software
STEP 4
Assign who owns each Rock. This is vital for clear accountability. Each of the three to seven company Rocks must be owned by one and only one person on the leadership team. When more than one person is accountable for a Rock, no one is accountable. The owner is the person who drives the Rock to completion during the quarter by putting together a timeline, calling meetings, and pushing people. At the end of the quarter, the owner is the one that everyone looks at to assure the Rock was completed.
STEP 5
Once the company Rocks are set, the members of the leadership team each set their own Rocks. They first carry forward any company Rocks that they own to their individual list of Rocks and then come up with their most important three to seven. Some of the Rocks that were discarded in Step 2 for the company can end up becoming individual Rocks for leadership team members. Please remember—no more than three to seven. Any Rock candidates left over on the original list that did not get picked up can be carried forward to the next quarter by putting them on the V/TO Issues List.
STEP 6
When all that great work is done, you then create what is called the Rock Sheet, which is just a landscaped piece of paper. At the top are the organization’s Rocks, and below that are each of the leadership team’s individuals Rocks. This Rock Sheet is brought into your weekly meetings to review your Rocks. It will help create clear accountability and focus on what is the highest priority in the organization. With that, a wall goes up, and no one is allowed to throw anything else over it, whether it’s a genius-level new idea or a hand grenade. Once the priorities are set for this quarter, no new priorities can be added! If someone does try to throw something else over, you get to throw it back because you all agreed on the current Rocks as being the most important priorities for this quarter. New ideas and thoughts that arise during the quarter should be put on the V/TO Issues List for next quarter. This approach will help you create laser focus for your organization. The following is an example of an effective Rock Sheet.
STEP 7
Share the company Rocks with the entire organization. As you learned in the Vision Component, the vision must be shared by all. Every quarter you should meet with the entire organization for your state-of-the-company meeting for no more than 45 minutes to share successes, progress, and the V/TO and to unveil the company Rocks for the quarter. Remember, people sometimes have to hear something seven times before they really hear it for the first time, and this is one of the ways they will ultimately share the vision.
STEP 8
Have each department set their Rocks as a team. Just as the leadership team sets their Rocks, each department team follows the exact same process to set theirs as well. In the end, each employee will have his or her own Rocks for the quarter. Please note that while the company and leadership team members should have three to seven Rocks, everyone else in the company should have one to three.
ROCK TRAPS AND PITFALLS
Your organization needs to avoid certain problems when establishing and carrying out its Rocks.
• Garbage in, garbage out. For every tool in the Entrepreneurial Operating System (EOS), you will get out what you put in. If you set the wrong Rocks, you will spend an entire quarter pointed in the wrong direction. Make sure you spend the necessary time setting the right ones. Do not rush the process.
• It takes two quarters to master Rocks. You will not master the process the first time around. Be patient, because true mastery comes from experience. You need to learn from two quarters with only your leadership team setting Rocks before you roll out the Rocks process to everyone else. You will make some mistakes and it’s important you learn from those mistakes first so that you can be a better teacher for your people.
• Commitment fizzle. Make sure that when rolling out Rocks, you’re fully committed to them every quarter. Some clients start off with a bang and then don’t commit to their quarterly routine. As a result they stop sharing them with everyone, and your people will end up feeling like the Rocks process was just another flavor-of-the-month idea.
• Too many Rocks. Don’t give people outside of the leadership team more than three Rocks. The responsibility is too overwhelming for most employees to handle, and you would be violating the golden rule that less is more.
Image One’s Rob Dube explains the cumulative power of all those Rocks: “One year during our annual all-company meeting, I had an idea to go around the room and ask every team member to tell us a few of the Rocks they accomplished during the year. While each person was talking, I was writing the Rock on the whiteboard. By the end, I was off the whiteboard and onto many pieces of paper from the flip chart! When you have a team of 35 people like we do, take that number and multiply it by two Rocks per person for a quarter, you get 70. Then multiply that by the number of quarters in a year, and you get 280! That is the magic number—we took 280 steps in the right direction over the past 12 months. Amazing!”
For now and forever, let’s dispel the myth that all meetings are bad, that meetings are a waste of time, and that there are already too many of them. The fact is that well-run meetings are the moment of truth for accountability. To gain traction, you’ll probably need to meet even more than you presently do.
In Patrick Lencioni’s book Death by Meeting, he opens the book by making a humorous observation. After hearing many leaders complain about meetings and saying things like, “If I didn’t have to go to meetings, I’d like my job a lot more,” Lencioni asks us to imagine hearing a surgeon saying to a nurse before surgery, “If I didn’t have to operate on people, I might actually like this job.” He then asks us to consider the fact that, for those of us who lead and manage organizations, meetings are pretty much what we do.
It’s possible to hold extremely productive meetings that actually save time. In this chapter, you will combine the 90-Day World with a powerful tool, the Level 10 Meeting. Together, these will enable you to have great meetings that increase communication, accountability, team health, and results. As a result of meeting more and following the Meeting Pulse, everyone will get more done. The time you spend meeting will actually free up time for moving forward.
The Meeting Pulse is your organization’s heartbeat. Rather than long, meandering meetings, a Meeting Pulse with a specific agenda throughout your departments will keep your organization healthy. A Meeting Pulse operates just like an EKG illustrating a spike. When people have to get something done for a meeting, they wait until the last minute and usually finish it—that’s the spike. The more you can increase the meeting interval, the more spikes you get, and then the more business you’ll finish. At first you’ll resist these regular meetings, but as soon as they become a habit, you’ll embrace them. You won’t know how you could have lived without them in the past. I have seen this happen with every client. It’s where the real magic happens.
The Meeting Pulse consists of two types of meetings. The first is quarterly and the second is weekly. Let’s take them one at a time, starting with the quarterly.
THE 90-DAY WORLD
As a part of your vision, you created a three-year picture. After that came a one-year plan and now a 90-Day World, as illustrated by the model on the following page. The 90-day idea stems from a natural phenomenon—that human beings stumble, get off track, and lose focus roughly every 90 days. To address this aspect of human nature, you must implement a routine throughout the entire organization that creates a 90-Day World.
I first discovered its effectiveness in my own organization. After my first full-day meeting with my leadership team, we all came out laser-focused on where we were going as an organization and what we had to do. Roles and responsibilities were agreed upon. We were on the same page and fired up. But 90 days later, for some reason, we’d all started to wander off track. I couldn’t explain why, so we held another meeting for a full day, pulling us all back together. We had a passionate, intense, productive meeting and got back on track again. Yet after another 90 days, I had to hold another meeting because I did not even recognize my team. “What happened to the people who were participating in that intense meeting 90 days ago?” I wondered. We couldn’t be further off the same page. But just like clockwork, by the end of the meeting, we were fired up and on the same page yet again.
I soon realized it was a normal cycle. When I really thought about the problem, I noticed it affected my Entrepreneurs’ Organization forum group, my friends, and my family. It seems to be human nature. Of the 1300 full-day sessions I’ve conducted, at least 900 have been quarterly sessions. People whose focus was clear in the prior quarterly session became unfocused by the following one. I would see absolute agreement on core issues the previous quarter and then total disagreement in the current one. By the end of the session, though, everyone would be back on track. In some situations, people didn’t even remember agreeing. Fortunately, I kept very good notes and could prove that they did.
Realizing this cycle was normal, I changed my attitude. First, I stopped getting frustrated and accepted it. Second, I decided to put together a great agenda for a powerful quarterly meeting every time. Now all EOS clients follow this exact same agenda in their quarterlies.
One last point: If you don’t continue to align quarterly, your organization will fragment to the point that you will get far off track, you will start to lose great people, you will lose sight of your vision, and you will end up right back where you started—in chaos.
To repeat, 90 days is about as long as a human being can stay focused. It’s human nature, so stop fighting it and solve the problem by following the Quarterly Meeting Pulse, thereby creating a 90-Day World for your company.
In addition, I strongly recommend that you hold your quarterly meetings off-site. When you’re at the office, there will be too many distractions to pull you back into the business. Being away provides a great opportunity for the team to truly work on the business.
THE EOS QUARTERLY MEETING PULSE
Who: The leadership team
Where: Off-site
Duration: Eight hours
Frequency: Every 90 days
Prework: Vision/Traction Organizer complete
(Everyone brings his or her issues and proposed priorities for the coming quarter)
THE QUARTERLY MEETING AGENDA
• Segue
• Review previous quarter
• Review the V/TO
• Establish next quarter’s Rocks
• Tackle key issues
• Next steps
• Conclude
Segue
This is the transition from a full 90 days of working hard in the business to starting to work on the business. Each person should share three things: (1) best business and personal news in the last 90 days, (2) what is working and not working in the organization, and (3) expectations for the day. Not only will this elevate everyone to working on the business, but it will also help set the stage for the quarterly meeting.
One person might say during his or her segue, “The best business news is that we landed the ABC account. What I feel is working is the new customer relationship management software. What I feel is not working are our delivery times, the customer service department, and our inventory system. My expectation is to solve these three things once and for all. Plus, I’d like us to be a healthier leadership team.” This, along with everyone’s segue, sets the tone for the meeting.
Review Previous Quarter
Review all of your numbers (quarterly revenue, profit, gross margin, and any other relevant key numbers) and your Rocks (company and leadership teams on the Rock Sheet) from the previous quarter to confirm which ones were achieved and which were not. I highly recommend simply stating “done” or “not done” for each. This will give you a clear, black-and-white picture of how you performed. Don’t get caught up in believing you can complete 100 percent of your Rocks every quarter. It’s perfectionist thinking and not realistic. You always want to strive for 80 percent completion or better—that’s enough to be truly great.
If you didn’t complete 80% you need to understand why and learn from it. Look at the Rocks you didn’t accomplish. Discuss why they weren’t completed. The two most common reasons for not achieving a Rock are:
• You took too much on and overshot, which was poor prediction on your part. In this case, your team will need to become better at setting more realistic Rocks. The first time most clients set their Rocks, they almost always set them too high.
• Someone dropped the ball. In other words, the Rock was attainable, but the person in charge did not give it his or her all. In this case, you have an accountability issue, and you need to put it on the Issues List and solve it. In the long run, you will reach a point where every member of the leadership team always gives his or her maximum effort when owning a Rock.
You have one of three options with incomplete Rocks:
1. Carry the Rock forward to the next quarter.
2. If the Rock is 95 percent complete, completing the last 5 percent simply becomes an action item for the To-Do List.
3. Reassign the Rock to someone else.
Review the V/TO
The sole intent of reviewing the V/TO every quarter is to refresh your memory on the vision and to make sure that everyone is still on the same page. Within that framework, you will set much better Rocks for the next quarter. When people are not on the same page, discuss and debate until they are.
Taking the necessary time to review the V/TO and get back on the same page in the quarterly meeting also leads to much better issue solving later in the session due to everyone having absolute clarity on the company’s greater good.
In an open and honest environment, everyone must voice their opinions if they don’t understand, don’t agree, or have a concern with any item in the V/TO. If there is any confusion, you must solve the issue at that moment until everyone is in concert. A good V/TO review takes between 30 minutes and two hours, depending how much discussion is needed. Make certain you conclude the V/TO review by updating the eighth section, the Issues List. Remove any issues that have been solved and add any new ones. This will build your Issues List for the day.
Establish Next Quarter’s Rocks
With the stage set from your segue, clarity on your results from the review of last quarter’s Rocks, your vision clearly in mind after your review of the V/TO, and your Issues List in front of you, you now follow the Rock-setting process covered earlier in this chapter.
List everything that must get done this quarter. Decide to keep, kill, or combine everything on the list, boiling them down to the right three to seven Rocks for the company and assign ownership. From there, establish each leadership team member’s Rocks and give them to one member to create the Rock Sheet.
Tackle Key Issues
With your Rocks set, you will have anywhere from one to four hours left in your meeting, depending on how long your V/TO review and Rock-setting took. It’s now time to tackle all of your relevant issues for the quarter. What makes for great meetings is solving issues. Start by making sure that all of the issues are on the list. Ask the team for any issues they have on their minds if they haven’t shared them already during the first half of the meeting.
You now go to the Issues List you have compiled, which includes issues from the first half of the meeting and all carryover issues from previous meetings that were listed on the V/TO Issues List. Remove all issues that were resolved by the creation of new Rocks.
Tackle the remaining issues following the Issues Solving Track—Identify, Discuss, and Solve (IDS). Establish the top three issues, then start with number one and work through the list in order of priority. For each issue, identify the real problem, then openly discuss all aspects of it, getting all opinions out on the table with no tangents. From there, move to solve the issue and make it go away forever. You will get through anywhere from one to 15 issues depending on the time you have and the magnitude of the issues.
Any issues you do not solve can simply be carried forward to your weekly Issues List or the V/TO Issues List, depending on their priority level. You will rarely solve them all. The important thing is to make sure you’re solving them in order of priority.
Next Steps
This part of the quarterly meeting is typically short. Everyone discusses any next steps—who is doing what, and whether there are any messages to communicate to the organization based on the decisions made in the meeting.
For instance, if you solved the issue mentioned in the segue regarding the customer service department, in Next Steps you might confirm that the director of operations is going to meet with everyone in customer service and together strategize and implement a plan this quarter to create a world-class customer service department.
Conclude
In concluding the meeting, everyone shares three things: (1) feedback on the meeting, (2) whether their expectations were met or not, and (3) their rating on the meeting from 1 to 10. You want the standard to average above 8.
It’s powerful how much the Quarterly Meeting Pulse can do for you. It focuses everyone on which direction you should row. You come out fired up and ready to take on the next quarter.
However, like clockwork, you’re going to start getting off track again 90 days later. Some quarters, you may think that you don’t need to meet. I can remember several times needing to convince my partners after they asked, “Why are we meeting again? Aren’t things going pretty well?” Don’t fall into this trap. You have to combat the human tendency to want to coast for a while and take a little pressure off. I have clients that call once in a while prior to a quarterly, saying they don’t think they need to meet. After I convince them they do, in every case they have reported they were glad they did. I can’t tell you how many times I’ve heard the words “Wow, and I didn’t think we’d have anything to talk about this quarter!” at the end of a client quarterly session.
You’re going to repeat that same Quarterly Meeting Pulse forever. You will find that the meetings keep getting better. With that routine in place, at the end of every year you will piggyback an extra day on the front end of your quarterly meeting for your annual planning. Annual Planning is an opportunity to build team health, reset the vision, and create a clear plan for the next year.
THE EOS ANNUAL MEETING PULSE
Who: The leadership team
Where: Off-site
Duration: Two days
Frequency: Every year
Prework: Bring completed Vision/Traction Organizer, proposed budget for next year, and thoughts on goals for next year.
THE ANNUAL PLANNING AGENDA: DAY ONE
• Segue
• Review previous year
• Team health building
• SWOT/Issues List
• V/TO (through one-year plan)
Segue
Each member of the leadership team shares three things: (1) the organization’s three greatest accomplishments in the previous year, (2) his or her one greatest personal accomplishment for the year, and (3) his or her expectations for the two-day annual planning session.
The power of the annual segue, in addition to setting the stage and transitioning from working in the business to on the business, is that leaders have a chance to stop for a few minutes and reflect on the company’s successes and progress over the previous year. After the segue, one client said, “I was actually feeling like we had a bad year until I listened to everyone share the business accomplishments. We actually had a pretty good year.” This is typically the mindset after the segue, and that sets the tone for what follows.
Review Previous Year
Review the previous year’s goals, the previous year’s numbers (previous year’s revenue, profit, gross margin, and other relevant key numbers), and last quarter’s Rocks. You should be achieving 80 percent or better of your goals to truly be great. One of the ways you and your team will become better predictors of future events is by reviewing your results and addressing what worked and what didn’t.
When you review your goals for the year, you must take the same approach as the Rock review. You want only black-or-white “done” or “not done” answers. This is one reason your goals must be very specific. If one of the goals for the year was “create a sales-focused organization,” how can you determine if that was done or not? If the sales goal was “$2 million in new sales from the sales team and $300,000 from account managers,” you can definitely determine if that was done.
Keep in mind your goals were set a year ago. Most people’s memories aren’t good enough to remember what the intention was that far back. You don’t have to remember intentions if you have specific and measurable goals.
There’s another reason to prefer specificity. You’re trying to assess how you did in order to determine exactly your degree of success or failure so that you can get better at it next time. When the results are vague and debatable, it’s far too difficult to see clearly what worked and what didn’t. You then rationalize your way into believing the year was better than it was. When you have no real way to pinpoint what to improve upon, you aren’t going to get better. So even if your first attempts to establish goals prove to be off the mark—sometimes way off the mark—keep trying. With practice, you’ll learn to set targets that are truly specific, measurable, and attainable, which will make you great predictors and ultimately lead to a solid, well-run, and enduring organization.
Team Health Building
Many great team-building exercises are available. You may already have one. If you don’t, I highly recommend an exercise I call One Thing. Each member of the team receives feedback from the others on his or her single greatest strength or most admirable ability and his or her biggest weakness or hindrance to the success of the company. The exercise is done out in the open, with the entire leadership team present. I believe the peer-evaluation methods that are conducted anonymously actually do more harm than good. This exercise has been done countless times with teams, and it always has produced great long-term results. Some clients have performed this exercise four years running at their Annual Planning Session, and the results get better every time.
After everyone has received the feedback from their team members, each then must choose one thing he or she will commit to doing differently in the coming year based on the feedback. It’s short, simple, very powerful, and effective, and it leads to great insights with improved openness and honesty on the team. This exercise should take no longer than two hours.
A great discipline I’ve used with my clients to assure full delivery to their commitments is to do a quick feedback exercise in each quarterly session. Each person states their commitment, and every member gives one-word feedback on how they are doing honoring it. They state either “better,” “worse,” or “same.” It’s a nice tap on the shoulder, and it substantially improves follow-through.
SWOT/Issues List
Provide an opportunity for everyone to share what they believe the organization’s strengths, weaknesses, opportunities, and threats are. This is the classic SWOT analysis, a management tool for helping an organization take a good look at itself and clarify its current state, both good and bad. The most productive outcome of the SWOT analysis is the Issues List. Once you have listed everyone’s opinions of the organization’s strengths, weaknesses, opportunities, and threats, you extract all of the relevant issues for the coming year and create an Issues List for the Two-Day Planning Session. This list, along with all additional issues added throughout the session, should be added to your Issues List for the next day’s Issues Solving.
V/TO (Through One-Year Plan)
At this point in the session, you challenge the company vision. This is the Annual Meeting Pulse, and nothing is sacred. Working your way through the V/TO, take a hard look at your core values, challenge the core focus, make sure everyone is still on board for the 10-year target, and confirm that the marketing strategy is still unique and valuable to the customer. Where you’re not on the same page, discuss and debate until everyone is in sync.
Assuming you’re all in agreement, you throw out the old Three-Year Picture and create a brand-new one. You want to make sure that everyone agrees on the same image three years from now. Once everyone’s mind’s eye can see it, the odds are greater that you will achieve it.
Once the new Three-Year Picture is clear, go to work on next year’s plan. Set the revenue, profit, and numbers for the coming year and then set your three to seven most important goals. Remember, less is more, so be careful. One-year planning rarely takes more than two hours. Don’t overthink it. When the vision is clear, the numbers and goals are right in front of you. You just have to put them down on paper and agree with them. In addition, make sure a budget exists to support the plan and that everyone is clear on their roles and responsibilities in the coming year. Let the Accountability Chart be your guide.
Some clients wrestle with the approach of throwing out the old three-year picture and starting with a new one. It’s important to take this approach for two reasons. One is that a full year has gone by and things have changed, so it’s important to take all of your knowledge and experience and incorporate it into a newly created vision. The second reason is that you’re smarter, better, faster planners than you were a year ago, and as a result, you’ll do much better work.
If it’s important to you to hang onto the old three-year picture, I’d recommend that you cut and paste it into a document to hang onto personally and see how you did, but the above approach is what is recommended and most effective.
THE ANNUAL PLANNING AGENDA: DAY TWO
• Establish next quarter’s Rocks
• Tackle key issues
• Next steps
• Conclude
Refer to the Quarterly Planning Agenda for details on the above agenda items.
Annual Planning Tips
• Many times, the one-year planning portion of the V/TO carries over into Day Two. Let it happen. You should not rush the process. You will have time on Day Two to complete the agenda if necessary.
• Have dinner together as a team at the end of Day One. Seize the opportunity to blow off steam after a day of intense thinking as well as to continue to build team health.
• Get away for annual planning. You don’t necessarily have to travel across the country, but a hotel an hour or two away will lead to a more productive meeting. When you’re removed from the office, you’ll be able to turn the real world off for a full two days.
THE BUILDUP
By religiously implementing the Quarterly and Annual Meeting Pulse, you create a 90-Day World that will reap tremendous benefits for your organization. There is a hidden benefit as well, one that I don’t even share with my clients. One of the main reasons that the Quarterly Meeting Pulse is so effective is what I call the buildup. With the prospect of a full day scheduled for the leadership team to meet, people prepare better for it without even knowing they are doing it. Their energy, fears, thoughts, issues, ideas, and excitement all start to build toward this special event. As a result, the meeting is much more effective.
The opposite also holds true. That is, if you don’t tell anyone you are having a quarterly meeting and simply call them into a full-day meeting, the result will be less fruitful. There is no buildup. You must always pre-schedule your quarterly meetings.
Many issues come up in the quarterly meetings that don’t typically come up in the course of day-to-day business. Countless times, when a touchy subject comes up in the quarterly meeting that has been lingering, others will ask, “Why did you wait until today to bring it up?” Often they don’t know why. It’s because of the buildup. It has spurred thoughts beyond the routine. People are more focused, energetic, and ready.
THE WEEKLY MEETING PULSE
The traction process continues taking the vision down to the ground. We are now narrowing in from quarterly to weekly. Implementing this step will really create traction and help you execute the vision. Once the quarterly priorities are set, you must meet on a weekly basis to stay focused, solve issues, and communicate. As you can see by the following model, the Weekly Meeting Pulse is your opportunity to make sure that everything is on track. If you’re on track for the week, then you’re on track for the quarter, and if you’re on track for the quarter, then you’re on track for the year, and so on. The Meeting Pulse, like a heartbeat, creates a consistent flow that keeps the company healthy. Put another way, the Meeting Pulse creates a consistent cadence that keeps the organization in step.
ALWAYS A LEVEL 10 MEETING
How would you rate your meetings on a scale from 1 to 10? The response is almost always somewhere between a 4 and a 5. That is simply not good enough. Most meetings in business are weak and not very productive, and yours probably are too. By implementing the ingredients of the Level 10 Meeting, you will raise that rating up to a 10.
The Level 10 Meeting Agenda is designed to keep your leadership team focused on what’s most important on a weekly basis. Nothing is more important than keeping your numbers on track, your Rocks on track, and your customers and employees happy. The Level 10 Meeting is the most effective and efficient way to accomplish that.
A weekly Level 10 Meeting keeps you focused on what’s important, helps you spot developing problems, and then drives you to solve them. What makes for great meetings is solving problems. Patrick Lencioni says it best: “Your meetings should be passionate, intense, exhausting, and never boring.”
The Level 10 Meeting was developed as a result of being engaged by a number of clients to improve their meetings. The guiding principles are based on human nature. This agenda was developed through real-world trial and error and experimentation with many different methodologies. Today, all EOS clients follow this exact agenda.
THE EOS WEEKLY MEETING PULSE
Who: The leadership team
Where: The office conference room
Duration: 90 minutes
Frequency: Every Week
Prework: Rocks established and Rock Sheet created; Scorecard complete; Issues Solving Track understood by everyone
THE LEVEL 10 WEEKLY MEETING AGENDA
| Segue | 5 minutes |
| Scorecard | 5 minutes |
| Rock review | 5 minutes |
| Customer/employee headlines | 5 minutes |
| To-Do List | 5 minutes |
| IDS | 60 minutes |
| Conclude | 5 minutes |
Two roles are vital in the Level 10 Meeting. One person must run the meeting. This person will move the team through the agenda and keep them on track. Second, someone must manage the agenda. This person makes sure that the agenda, Scorecard, and Rock Sheet are updated and in front of everyone in each meeting. They update the To-Do and Issues Lists in the agenda each week.
Segue
The meeting starts promptly. Football coach Vince Lombardi was famous for his mantra that early is on time, and on time is late. Arrive a few minutes early so you can start to get your head in the game. The only reasons for missing the weekly Level 10 Meeting are vacation or death. Even if someone cannot make the meeting, the show must go on. Don’t reschedule it and don’t cancel it.
Everyone should have a copy of the agenda placed in front of them. Your to-dos and your IDS Issues List should be included in the actual printed agenda. Your agenda should fit on one sheet so that you’re only managing one piece of paper. You no longer need to take meeting minutes. They should be a thing of the past. If you want to know what was covered in a meeting, check that week’s agenda.
As a team, you share good news to segue into the meeting. As always, you need to create the transition from working in the business all week to working on the business, disconnecting from day-to-day affairs. It’s important to turn off all electronic devices so you can disconnect, take a deep breath, change gears, and get to work. In addition, the segue reminds you that you are all simply human beings in this world trying to create something great. This item should take no more than five minutes.
Scorecard
The Scorecard review is the leadership team’s opportunity at a high level to examine the five to 15 most important numbers in the organization and to make sure they are on track for the goal. Any numbers that are not on track are dropped to the IDS portion of the meeting, which is your Issues List. Avoid any discussion here. The reporting phase should merely identify problem areas. The biggest pitfall with most teams is that they launch right into discussing and trying to solve an issue. You must fight that urge and be disciplined. That keeps the meeting on track. There will be plenty of time to discuss and solve issues in the IDS phase, and the process will be much more productive when you’re addressing all of the issues at once. Scorecard review should take no more than 5 minutes.
Rock Review
Next, your leadership team focuses on your Rocks to make sure that they are on track. Review each Rock one at a time—first the company Rocks and then each person’s individual Rocks. Each person reports that his or her Rock is either “on track” or “off track.” No discussion—the discussion will happen later. When a Rock is off track, it’s dropped to the IDS portion of the agenda. “On track” simply means that the owner of the Rock feels he or she will accomplish it by the end of the quarter. Even if a Rock is on track but someone wants an update or has a concern, it should be dropped to IDS. Rock review should take no more than 5 minutes.
Customer/Employee Headlines
Share short and sweet headlines about any customer or employee news or issues for the week, either good or bad. For example, “Joe, our best client, is happy with the job we did last week,” or “Darla is upset with the decision on the new benefits program.” The good news is a time to pat yourself on the back. Any issues, bad news, or concerns should be dropped to the IDS portion of the agenda. Some companies have a formal customer and/or employee feedback system. If your organization does, this is where you would incorporate that tool. Headlines should take no more than 5 minutes.
To-Do List
Review all to-dos from last week’s meeting. To-dos are seven-day action items. From a weekly review comes accountability. By incorporating this agenda item, you will accomplish more as a team. To distinguish a Rock from a to-do, remember that a Rock is a 90-day priority while a to-do is a seven-day action item. To-dos consist of the commitments people make throughout the week that typically don’t get captured. For example, “I’ll call the printers tomorrow,” “It will be shipped tonight,” or “I will have every prospect on the list contacted by Friday.”
Quickly review each item on the To-Do List from a standpoint of “done” or “not done.” If the to-do is done, strike it from the list. If it’s not done, leave it on the list. Note: An action item should not remain on the To-Do List for more than two weeks, and 90 percent of them should drop off every week.
The to-dos hold your team accountable to all the commitments they made in the previous week. All human beings are procrastinators by nature. Imagine what it would be like if everyone in your organization did everything they said they would. It would be a different world, right? The power of the To-Do List is uncanny. During the experimentation with running a client’s weekly meetings, I discovered that the commitments that team members were making to each other from the previous week were not being carried out. People would make promises, such as making a call, shipping a package, or finishing a report. A week later, I would find that, of 10 commitments, only a few were done. As a result, I incorporated a To-Do List into the meeting. Once everyone had to report on them the following week, the number of tasks completed went from a few out of 10 to nine out of 10. Productivity increased because people knew they were going to be held accountable.
Traction and accountability are created when these weekly commitments are captured on the To-Do List and are reviewed for completion the following week. The days of making a commitment, knowing that no one is going to confirm that it was done, quickly fade. This agenda item should take less than 5 minutes.
IDS
This is where the magic happens. It’s time to tackle your Issues List. Great meetings are created by solving problems. You should have 60 minutes for solving issues. This part should always take up most of your meeting.
On average, about three to five issues on the list will come from last week’s meeting. During the reporting this week, you will have added new issues—about five to 10, on average. Typically, the list contains five to 15 issues. Although your Issues List is in your agenda, it can be effective to write your Issues List on a whiteboard or flip chart so it’s in front of everyone. Many clients have said that this leads to better participation than everyone looking down at their copies of the agenda.
Decide which issues are number one, two, and three. Start with only the top three because, as a rule of thumb, you don’t know how many you’ll resolve. As long as you take them in order of priority, you’re attacking the right ones. To repeat, it’s a mistake to start at the top of the list and work your way down because sometimes the most important issue is near the bottom of the list. In addition, when you solve the most important issue, you tend to find out some of the other issues on the Issues List were symptoms of that core issue, and they drop off automatically.
Go to work on number one, and work on it alone until it’s solved following the Issues Solving Track. Some weeks, you will get through only one issue. Other weeks, you will get through 10. You never know, but again, as long as you’re taking them in order of priority, you’re tackling the company’s largest obstacles.
Once the issue has been identified, discussed, and solved, the solution usually turns into a plan of attack that ends up on the To-Do List. You may end up with one, two, or three to-dos as a result of that one solution. In next week’s meeting, you will confirm that the to-dos have been accomplished and the problem has been solved forever, rather than hanging around as in the past.
Following the Issues Solving Track keeps a team focused on what’s important, and it avoids spending time on what some may think is a priority and really isn’t. This vital portion of the meeting should be passionate, intense, exhausting, and never boring. There should be no politics; the discussion should be open and honest, with everyone sharing the vision and fighting for the greater good. By solving all of your key issues for the week, you feel a tremendous sense of resolve and accomplishment.
Conclude
With five minutes left, move to conclude the meeting. This is your opportunity to pull the whole meeting together. You can frame everything that was discussed and make sure no loose ends are left.
Concluding has two parts. First, recap your new To-Do List. Quickly restate all of the action items on the list to confirm that everyone has theirs written down. This step reinforces accountability. Second, discuss whether any messages need to be communicated to the organization based on decisions you made today, how you’re going to communicate them, and what medium you’re going to use. This step will greatly reduce communication issues that may have occurred in the past, when people were surprised with changes that were made without their knowledge.
I highly recommend adding a third item to your conclusion of the meeting to help you get instant feedback on how you’re doing. Simply have everyone rate the meeting at the end on a scale of 1 to 10. Your goal should be an 8 or better.
At the end of the meeting, there should be a feeling of conclusion. The meeting ends on time. This avoids any domino effect where meetings run over and push other appointments back, blowing up people’s schedules. And that is the Level 10 Meeting Agenda in a nutshell.
THE FIVE POINTS OF THE WEEKLY MEETING PULSE
A productive Meeting Pulse should meet the following five criteria. The meetings must
1. be on the same day each week,
2. be at the same time each week,
3. have the same printed agenda,
4. start on time, and
5. end on time.
Making the meeting the same day and time creates a routine. Using the same agenda discourages reinventing the wheel; once you have an agenda that works, stick to it. Plus, it also helps to keep the meetings consistent. Start on time, because when you start the meeting late, the part of the meeting that always suffers is the issues-solving time, and that’s what matters most in the meeting. You will cut down the best part. And end on time so that you don’t push back any following meetings.
Be patient with the Weekly Meeting Pulse. Your first meeting will be awkward, but as you stay committed to it, it will become very comfortable. The level of team health, communication, and results will consistently rise.
THE WEEKLY MEETING ROLLOUT
Once you master the Weekly Meeting Pulse as a leadership team, the next step is to roll it out to each department. Clients typically take about three months to institute the Weekly Meeting Pulse throughout their organization, because the leadership team must master it first. Departmental weekly meetings are typically closer to 30 to 60 minutes. Use the Level 10 Meeting Agenda as a guide for customizing your departmental meeting agendas. Just make sure that at least 50 percent of the meeting time is spent solving issues.
MEETING PULSE ACTIONS
1. Schedule your quarterly session as close to the quarter’s end as possible and then every quarter after that. Follow the agenda and Rock-setting process in your quarterly meetings, then roll Rocks out by department.
2. Decide when your Weekly Meeting Pulse will be as a leadership team. Pick the ideal day and time for you to meet every week. There is no rule of thumb; just decide what works best for you.
3. Follow the Level 10 Meeting to the letter for one month. At the end of the month, read this chapter again. Make any fine-tuning adjustments, and then continue for another month. If in the future you find yourself getting off track again, refer back to the chapter as often as necessary to stay focused.
4. Decide who is going to run the meeting. There can only be one. This person has to be comfortable moving people along and pushing them through the agenda when they are getting off track.
5. Decide who is going to manage the agenda. This person keeps the To-Do and Issues Lists updated during the meeting and makes sure a copy of the agenda, the Rock Sheet, and the Scorecard are placed in front of everyone when the meeting starts every week.
By setting Rocks and implementing a Meeting Pulse that creates a 90-Day World and weekly focus, you gain tremendous traction toward your vision.
You are now doing what the successful companies do. Your frustrations from the past start to subside, and you make progress on your way to breaking through the ceiling. Your organization evolves from chaotic to a well-oiled machine. Your journey is now complete. Or has it just started?
