The Guru

There’s a difference between a company that wants to make money, and a company that wants to make money by being great. Industry guru David Maister on the fine line between success and failure.

So here’s the thing. You’re sitting at your desk reading a press release about David Maister, a world-renowned business author and management consultant. According to the release, he’s offered a series of podcasts exploring how to build your business better through marketing, client services, client relations and selling – for free no less – pretty much unheard of for someone so high up in their field, and all part of his philosophy of being generous with his ideas.

You think to yourself that speaking with Mr Maister would be a major coup for Business Management (and you’d be right). Reality then hits when you appreciate you’re talking about someone who is widely acknowledged as one of the world's leading authorities on the management of professional service firms, has been identified as one of the top 40 business thinkers in the world by the Financial Times, and can charge up to US$18,000 a day for his consulting services. The rush and enthusiasm slowly ebbs away. There’s no way he would have time to answer some questions – would he?

Unperturbed, out it goes, the speculative e-mail begging for a few seconds of his time. Do you expect to get a response? Like hell you do. Smug in the knowledge that at least you tried, you answer the phone an hour later with the usual happy greeting. The reply? “Jon, David Maister…”

Now bear in mind that this is a man who is at the very top of his profession (have I mentioned this already?) and who, if his standing in the industry is anything to go by, isn’t the kind of person who’s going to mince his words: fail to impress him and he’s highly likely to tell you where to go (I hope I’m not being too unfair). Needless to say, I’m worried, and this isn’t helped by a nervy start – witness this, somewhat paraphrased, section of the conversation:

DM: “So what exactly do you want?”
JE: An interview or perhaps an article would be really good…
DM: “So you want me to do all the work then?”

Not quite the start I was looking for. Nevertheless, we agree that I will send through some questions in a couple of hours and wait to hear if he’ll answer them. Two hours later the questions go out and, fairly happy that they hit the right note, I sit back and relax. No chance. 10 minutes later an e-mail comes back advising that he will call in 10 minutes to go through the questions – oh, and here’s 18 pages of analysis to read through while you wait. What have I done, I ask myself? You’re batting with the big boys now and you’re about to be hit out of the park…

So I’m tapping the table for 30 minutes – still no call. Waiting another 10 minutes with not a murmur from the phone, a cold sweat covers my brow as I contemplate the worst – there’s a fault with the phone. I tentatively listen to voicemail and there it is, David’s call, when it was agreed, 30 minutes ago. Damn.

There’s no other choice; I have to phone back and face, well, whatever it is I’m meant to face – scorn, anger, a verbal slaying…

What transpires, you’ll be happy to know, is the most enjoyable interview I’ve had the fortune to be part of. This is a man that rightly commands the respect of his peers and those who require his services, but seemingly has the ability to make anyone sit up and take note. From the first minute to the last, I sat there, captivated, knowing that this is someone you should be listening too – even if you don’t know what he’s talking about – you just know it all makes sense. So here it is, the culmination of three of the most intense hours I’ve had in publishing (plus the hours of two finger typing to transcribe it or course). Take it away, David: no interruptions – just editorial dynamite!

Effective management

“The essential thing to understand about the role of a manager is that it is the manager’s job to make people successful. In any business, the money isn’t made by the manager, the money is made by whether or not the staff in the business are actually turned on. In my book Practice What You Preach, a statistical study, I was able to prove that there’s actually a causal path to profits.

“It says that if you want to make the most money, it is clear that the way you do it is to provide value to your marketplace. But here’s the rub: you can’t do this unless your people are rated somewhere in the gap between good and excellent. It’s not about your people being competent or reliable; you don’t get superior returns by people just doing their job. The only way you get superior returns is if everybody you employ comes to work saying: “Wow, I can’t believe I get a chance to do this again today.”

“What the research shows is that the way you get all your people energized, excited and enthused has nothing to do with systems, nothing to do with strategies, nothing even to do with compensation systems. It has everything to do with the skills of the individual manager – skills that are variously described as emotional skills, interpersonal skills, politics skills – leading to a very simple conclusion: do people raise their game as a result of interacting with their manager?

“What this should draw your readers’ attention to is that it has nothing to do with intelligence. It’s got nothing to do with IQ or rationality. The job of the manager is not to be right or to have the answers, because that’s not what makes the most money. Everybody knows, for example, that every business has got to provide superior customer service. Knowing that is not particularly much of an added value. What adds value is a manager who can get everybody to do that. What that says is that management is inherently about being interested in your people and being able to get them turned on psychologically.”

So how does a manager do that?

“There’s two key steps. One of the most important insights you’ll get – you, me and everybody else – is that very few of us will lay down our lives for the country. We don’t do it for the greater glory of IBM, we don’t do it for the greater glory of South Wales. The truth is that we get turned on when we’re asked what we’re excited about, and given the chance to do what turns us on. What I’m trying to say is that the best managers don’t tell people what to get excited about, they find out what people are already excited about and find a way to use that for the business.

“The essence of a great manager is reading and having conversations with individual people, finding out where their hot buttons are and then getting those people into the right roles so that you can say “this is the best way this person can contribute to the business”. Once again, the sequence to making money is that if you can get everyone to be energetic pursuing things for themselves, and the things they do for themselves help the business, then everybody wins.

“What that says is that management is inherently a retail, not a wholesale occupation. There’s a lot of managers that believe they can give one inspirational speech and 300 people will be turned on. The truth is that while there is some history of people being able to do that (three of their names were Stalin, Hitler and Chairman Mao), it really is an incredibly scarce talent – so much so that if you were advising a manager on how to get good at turning other people on, giving the visionary speech would be such an unlikely thing to pull off that you wouldn’t advise it at all. Instead, you advise them to focus on the individuals.

“Similarly, the way you build teams is important; as much as possible, you should try to get people to form voluntary teams. In other words, the best way to form teams in a business is not to say: “you guys are in the same department, therefore you will cooperate with each other”, because giving orders like that is just not very effective in human terms. However, if you go to your people and say: “I’ve got the following six projects that need to be done superbly well in the next year, does anyone want to volunteer for any of them?”, then the fact that people all joined in to the same team and put themselves in voluntarily is much more likely to get them to want to get on with each other – they self-selected to be interested in similar things. The trick of it is to unbundle the larger purpose of the total department and turn it into short-term, temporary projects asking for volunteers, and then at the end of it, when the project is done, you redesign the next set of challenges for the business.

Identify potential managers

“The first thing I would stress, although it is a little repetitive, is that if the essence of a job as a manager is to make other people successful, then you’ve got to be the kind of person who can get satisfaction out of helping other people succeed. One of the things I’ll rush to say to your readers is that the reason I, David Maister, am solo, is that I actually don’t pass that test. In other words it’s an attitudinal test that comes first, not a skill test.

“What I’ve learned in all my years as a professor and consultant is that if someone wants to learn something you can teach them anything, but if they don’t want to learn it, you can’t teach them anything. So the essence isn’t managerial skill, it’s managerial attitude. To give you a sports metaphor, if you’ve got a sports coach, his job is to make the players win. The players have the fun of scoring the goals, getting the groupies, getting the attention in the press, so the coach has got to have this ability to stand on the sidelines, getting his satisfaction from knowing they were his players. That’s a very peculiar kind of mentality, so that’s one of the things you look for when you’re trying to find a manager – how do you get someone that doesn’t have high ego needs?

“There are some people who can go to another person and offer a critique and have the recipient say “wow that was really helpful, I’m glad you came by”. Unfortunately, many of us – myself included – can’t do that very well. I give somebody a critique and they quit!

“So after the attitude, the next thing is whether or not you have the kind of supportive style that allows you to be challenging – because a manager who’s not challenging is a wimp and is useless – but also whether you can learn to be challenging in a way that people accept as help. So in other words, the sports coach analogy is not just a trivial one: it’s actually the key to understanding what effective profit-making managers are about.”

How can a business best help in this transition?

“The business must be very tough in making sure they’ve got the right managers in place and that the managers are held accountable for being good managers.

“The essence of getting the troops energized is not when the general says “Charge! You guys go over the top and get yourselves slaughtered”. That’s not leadership; rather, the essence of getting the troops energized is by saying “follow me, I’ll go first”.

“So I would suggest that what is needed is a system where once every year, everybody in a group or department evaluates their manager and the results are published to everybody. This should then be the speech the manager gives: “OK everybody, here’s what you think of me in my role. Don’t expect me to be perfect today because that’s not the standard we hold each other to. In fact, don’t expect me to be perfect in a year. However, I’ll give you a promise that if you don’t think I’ve improved in my role as a manger by next year, I will resign”. In other words, the manager goes first in saying the way we make money, the way we succeed, the way we have fun, is that we all get better in our role, and I’ll go first. Then the manager can turn to everybody else and say “OK guys, now it’s your turn”.

“What I’m trying to say is that very few businesses have that. I’m not trying to be idealistic here, I’m just trying to be a practical, factual reporter, and I’m saying that the single best way to get the troops actually energized is a manager who’s prepared to be accountable for their role.”

Key appointment errors

“The traditional appointment error is not recognizing the huge difference between being good at something yourself and helping other people get good at it. This isn’t new to me, it’s the oldest thing in the world. We always make the mistake of making the best sales person the sales manager.

“What you need to understand is that the skills that make you good at what you do are not only not the right qualifications for a manager; they can actually almost certainly work against it. The more successful you are as an individual contributor, the higher the odds that you have high ego needs. That’s not meant to be unfair to anyone, it’s just factually true. Therefore, the notion that you’ll be able to give up the satisfaction of being terrific at what you do and now have to live your life getting your satisfaction through the efforts of others is like turning someone entirely from one mentality to another.

“The managerial role is incredibly frustrating, but you’ve got to get in there and do it. To really motivate people, you’ve got to give them a chance to do it themselves without interfering. There’s a lot of people, including me, who would find that immensely frustrating.”

Advice on accepting a managerial role

“Give everybody a fair go (in other words, let them try and perform the role properly), but put measures in place to assess whether people are in fact performing that role. That’s the first step and that’s what’s missing in so many businesses.

“What we need to do is stop saying business is mostly about things of the mind. It’s not. We tend to view good managers as people who can do good analysis, read the financial statements or apply the latest consultants models, and in all of that we are over-celebrating the things of the mind. My standard joke is that most people like me have over-developed brains and under-developed personalities. What I’m trying to say – and this is backed up by research – is that it’s the manager’s personality that will most affect how well other people participate or do not participate in the things the business needs to do to make money. It’s not the brilliance of the manager; it’s their personality.

“Most of the coaching we need to give people is on how to improve their interactive style. According to one recent study, the thing that is done least well in almost every business around the world is the people-side of things. The question therefore is this: without being political or moralistic, does it matter if the thing we do least well in business is turning on our people? We’ve always assumed it kind of matters, but it wasn’t as important as cash, and it wasn’t as important as dealing with the clients. However, what I’m trying to say is that you cannot get the cash if your people are not turned on, you cannot please the clients unless your people are turned on. So being good at energizing your people does matter a great deal.”

Keeping hold of a good manager

“I believe money is one of these ‘business hygiene’ issues – you’ve got to pay me well or I will walk. But the way you get me to stay is to make me believe that the company is trying to do something that I want to be part of. This is the conclusion companies are increasingly coming to, which is why you can’t get people to stay just with a pay scheme; people will always offer more pay.

“The way you get people to stay in a society is make them believe that that society stands for things that they believe in and they want to be part of. So you’ve got to pull off something that is very difficult, you’ve got to make them believe that the business is trying to accomplish something. Notice again this isn’t an anti-money argument, but there’s all the difference in the world between a company that says it wants to make money and a company that says we want to make money by being great at certain things. It’s not that money isn’t the goal, it’s just that a company that uses the first argument is hard to believe in.”

And that’s it, the management world refreshingly laid bare; no hyperbole, no rhetoric, clear and simple. It all just makes sense and, more importantly, I’m still in one piece. Now I’ve just got to get this approved…

Free subscriptions to David Maister’s articles, podcasts and blog are available at www.davidmaister.com.