Key points from this chapterA key question to ask yourself is: Is the problem covered by an existing policy or personal principle? That’s one of the first and key things to look for. Is there an existing policy or personal principle that tells you whether you should go ahead or not?
“I run a company in Seattle that distributes garden tools and equipment. One of my buyers told me about a container of ten speed bikes that’s on the water, only five days out from port. The chain of stores that had ordered them declared bankruptcy, and I can pick them up for 25 cents on the dollar. My problem is that it sounds like easy money, but I can’t decide.”
This is a problem best answered by referring to policy. You’re in the gardening equipment business. Your corporate mission statement probably tells you that you shouldn’t get into the bicycle business. However much money you could make, you shouldn’t be tempted.
Roy Disney used to say that decision-making is easy when values are clear. I’m not just talking about corporate policy here. Individuals should have clear principles. It makes problem solving easier. If something comes up that violates your principles, your ethics, or your morals, you won’t do it regardless of the temptation.
One of the reasons that Nordstrom Department Stores is so successful is their policy manual. The entire thing is one page long.
Nordstrom’s Policy Manual
“Welcome to Nordstrom. We’re glad to have you with our company. Our number one goal is to provide outstanding customer service. Set both your personal and professional goals high. We have great confidence in your ability to achieve them. Nordstrom’s rules: Rule 1: Use your good judgment in all situations. There will be no additional rules.”
One of the most successful grocery stores in the country, Stew Leonard’s in Connecticut, has its policy manual engraved in a rock outside its front door. It’s two paragraphs long:
Stew Leonard’s Policy Manual
Rule 1. The customer is always right.
Rule 2. If the customer is ever wrong, reread rule one.
Isn’t that a great policy? If you want to go into a business where the customer is always wrong, become a policeman, not a store owner.
Imagine how many times a day employees at Nordstroms or Stew Leonard’s wonders whether they should or shouldn’t do something. Then they think of the company policy, and know what to do.
When I was young, I was the merchandise manager at the Montgomery Ward store in Bakersfield, California. Although Bakersfield was a small agricultural community, we ranked in the top 15 stores out of 600 nationwide. We did it with a determination to keep our customers happy at all cost. I would tell the department managers, “If you have a customer who wants you to give them a refund or an adjustment, give it to them. Because if you send them up to my office I will give it to them, so you might as well be the hero.”
Back to the Seattle garden tool-distributing company. Perhaps its company mission statement is broad enough to permit the president to buy the container of ten-speed bikes. Perhaps it says “We will become the most profitable distributor of garden equipment in the Northwest, by offering the finest service at competitive prices. Also we will take advantage of opportunities to make money in other areas.” That’s fine, because I’m not telling him how to run his business, but I am saying he’ll be more successful if he has a clear mission statement that everybody who works there understands.
Individuals’ policies are called principles
It’s important that you have a personal policy to guide you also. A personal policy is what we call a principle. If we all are clear on our principles, a life plan against which we applied our problem solving and decision-making, we could free up vast stores of energy for the really important things.
Let’s take the simple act of driving the car to the store. It’s only a mile away—should we bother to put on the seat belt? If our personal policy/principle says that we always drive with a seat belt, there’s no wasted energy making a decision. We slip it on almost without realizing it.
On the way to the store, the traffic signal turns yellow. A surge of adrenaline occurs. Should we go for it, or hit the brakes? If our personal policy/principle is that we always stop for yellow lights, we stop calmly, without wasted energy.
A car is standing in a driveway, waiting for an opening to pull into traffic. Should we wave it ahead of us, or let it wait? With our principles clear, there’s no hesitation.
Now please understand that I’m not telling you how to drive, although I do care about your safety. If your personal policy tells you to gun it for yellow lights, or never wear a seat belt, and never let a jerk pull in front of you, that—I suppose—is your business. The point I’m making here is that if you don’t have a personal policy by which you run your days, you’re operating an inefficient, energy-wasting life.
If you waste that much nervous energy just driving to the store, imagine how much waste there is in an organization that doesn’t have a clear company policy! I’ve been in organizations like that. The leader has everybody on such a tight rein that people at all levels agonize over decisions, wondering whether the boss will agree with what they’re about to do. Because the game plan changes every week, people can never be sure that what was the right way to solve a problem last week will still be the way to go this week. The organizations that do have a clear policy are a joy with which to work. As Roy Disney said, when values are clear, decision-making is easy.
Is your problem covered by your policies?
The third question is to see if it fits your corporate and personal policies. If it does, you either follow policy, or consider changing the policy. You don’t make random exceptions to the policy.
If you don’t already have a policy for this problem, you should then consider if it’s likely to recur. If it’s likely to recur, you should establish a policy that tells you how to handle it the next time it comes up.
When I say policy, I’m not just talking about your corporate policy and procedures manual. It applies to your personal life, too. If your son disobeys your instructions, and comes home late, do you ground him, or don’t you? Think it through, and establish a policy. Not only will you get more respect from your children because you’re consistent, but also you’ll save a lot of nervous energy. Because the next time it happens, you won’t have to waste time agonizing over how to solve the problem. That doesn’t mean you become an inflexible tyrant. Your children should always know they could appeal to you for an exception to policy if they have a good enough reason.
After you’ve made a decision, it’s important to decide if you need a policy to handle this if it comes up again. Whenever you solve a problem, think to yourself, “Is it likely to recur?” If you set up a policy, all future responses can be programmed. When the problem recurs, it doesn’t require another decision.
People unconsciously do this all the time. A 4-year-old uses a swear word in front of his father. The father whops him upside the head. The boy creates policy to handle this in the future. Usually it’s “Don’t swear in front of Dad anymore.”
You probably know somebody who lost everything during the Great Depression. They then made a policy of never borrowing money on real estate again. They didn’t know they’d created a policy, and it wasn’t smart, but it stayed with them for the rest of their lives.
Problem solving shapes your life; you become the sum total of all the problems you solve. But what’s even more important is whether you make a policy, after you solve a problem. If the problem is likely to come up again, write a policy to handle it in the future. That’s what really shapes the rest of your life. And that’s what really shapes the future of your company.
Key points from this chapter
Is it covered by an existing policy? If not, should a policy be created to handle this when it comes up again?
If it doesn’t conform to your policy, you can still decide to do it, but you have to change your policy to adapt to it.
Don’t make random exceptions to your policy.
Develop a personal policy by which you run your life. We call that your principles. It removes a great deal of stress from your life and saves your energy for more important things.