Layered Leadership by Lawrence R. Armstrong

Layered Leadership by Lawrence R. Armstrong

Book Excerpts

 

INTRODUCTION

Leadership, whether of a startup; Small, mid-sized, or large firm; team; church; or any organization, must work as a whole across the continuum of functions and people, comprised of many layers, but not in the traditional manner of layers of management in a bureaucratic org chart.

 

Integral to what I teach and share is that this kind of leadership is creative. It’s about synthesizing input from many varied sources. It’s about bringing your whole self to the team and the objective. No layer in life is constrained by another layer

 

PART ONE: THE FOUNDATION – STAYING BALANCED

Chapter 1- How to Use This Book

When you acquire a smaller firm or bring in a senior person from outside, you need time for people to acclimate to your culture. Bringing your whole self to work, cultivating your diverse capabilities, and identifying the best career opportunities is an excellent way for you to develop as a leader. It’s a great way to build a culture.

 

When you are the leader, when you are the CEO, leading a business unit or a small business, your thought process must be out in front of your company. Think about where the company is going, where you want it to go, and how you are going to always get there. You need to look into the future. Commit your vision to paper, not just in your mind but also by mapping out where your company’s potential can be achieved.

 

We adopted W. Chan Kim and Renee Maurborgne’s method for identifying “Blue Ocean” layers in your industry or vertical for expansion. We don’t want to swim in a Red Ocean. We want to swim in a Blue Ocean. (red oceans are crowded with businesses that are fighting for a share of the market, while blue oceans represent new and uncharted territories with potential for growth and innovation.)

 

Many design firms make the mistake of announcing, “We do everything. “ We didn’t do that, and neither should you. We decided to compete in sectors that are closely aligned to our core business but provided a buffer against recessions.

 

Many of us don’t think of ourselves as creative. My experience and hard-won view is that everyone is creative if they adopt a continuous learning, whole-brain approach. Whether that describes you or not, we all have strengths and weaknesses. As opposed to feeling bad about your weaknesses or areas of inexperience, Vince Lombardi said, view those as windows into where you are in your life and your career. It is your responsibility to accept that information about yourself, to do better, to take it further, to take your growth as far as you possibly can.

 

Chapter 2- Self-Awareness and The Art of Leadership

Continuous learning is more than training content and conferences, though these are critical period it’s how we learn about ourselves and push the limits of our potential.

 

If your mind is open to learning from every experience and every person, you no longer fear what you have taught yourself to avoid. If you want to be a leader and run a business, it’s important to immerse yourself in and experience every aspect of that business-especially those parts where you are weak or uncomfortable. If you avoid them, you will not be as effective a leader as possible. You don’t have to be great at everything; That’s not the point. But if you’re not great at P&L statements or balance sheets, at least understand them so you have some fluency and can discuss them intelligently.

 

The following outlines critical skills for leadership development, with each person identifying their areas for growth.

Build your team

• Use a collaborative, team leadership style
• ID your successor
• Allow others to lead
• Develop and coach others

 

Build your business

• Steady vision: stay out in front of your company.
• Prioritize what is best for that company over what is best for yourself
• Communicate with passion and integrity
• Jump in occasionally to help get the work done
• Listen and pay attention

 

Build yourself

• Focus on growing, pushing your own limits
• Ask for candid feedback from a trusted colleague
• Set the example
• Be approachable
• Employ empathy for others

 

For a business to thrive, leaders have to set an example and model the credo of their company. That instills behavior and builds culture.

 

A book on networking that helped me said that giving and finding something in common with the person you are chatting with is an approach that works over time. Lead with a giving approach. Take what is offered and be a giver in return. Follow-ups and opportunities flow organically. One mistake many people make is joining networking events and aggressively asking for business.

 

As with many managers, I had to learn the hard way that you should hire slowly and fire fast.

 

I had to learn that people can do great work but may have different ambitions or aspirations than me, because their life situations require that.

 

When I first started managing an office, and later when I was responsible for the financials of the entire company, I found it important to learn how to analyze and interpret profit and loss statements and balance sheets. I sought guidance from individuals as well as our consulting accountant and asked many questions to gain a better understanding.

 

We know that the economy can be unpredictable, which is why we always seek out the best information available to understand its trajectory and impact on our business lines and regions. It’s not always easy to make decisions about staffing levels, but it’s crucial to our success. We understand that these decisions can have a personal impact on our staff, but we also know that keeping the company healthy is essential for everyone’s stability and longevity.

 

In my experience, it’s always best to be proactive when it comes to staffing decisions. Delaying action only makes existing challenges worse, which is why we’ve always made timely decisions about staffing. It’s not just about immediate stability; It’s about ensuring that we can continue to compete and thrive even when things get tough.

 

A few practices nurture joy and creativity beyond what we’ve discussed: give yourself the freedom to fail when innovating, empower yourself to reimagine your work product or process and prove it works, help your team members when needed, and, importantly, don’t overschedule. You need exploration and planning time for those flashes of light to be seen.

 

Chapter 3 – Developing Others and The Pivot to Leadership

in management history, Douglas MacGregor identified two approaches to motivating employees: one involves an authoritative direction and top-down control, while the other emphasizes employees’ sense of accomplishment, ownership, and self-control. These approaches are known as Theory X and Theory Y, respectively.

 

Peter Drucker is widely respected as the pioneer of many modern management strategies. Among these, his most renowned is the concept of MBO (Management by Objectives). The MBO approach involves setting realistic and objective goals, communicating them to the employees responsible for achieving them, and appropriately dividing the responsibility for their accomplishment. Management’s role is to provide support, monitor progress, and evaluate performance, intervening when necessary to correct any issues that arise. If the goals are met or exceeded, all share in the profits.

Michael Porter suggested that there are three ways for a firm to gain competitive advantage. First, they can opt for cost-based leadership by becoming the lowest cost producer. Second, they can offer a differentiated product or service for which a customer is willing to pay a premium price, thus achieving value-added leadership. Lastly, they can compete in a niche market with a laser like focus.

 

Layered leadership is about strategies moving and reforming themselves, with employee contributions becoming a catalyst for that evolution.

 

At Ware Malcomb, we allow every employee to participate in shaping the company’s goals. We nurture generative innovation where new ideas are always percolating. It is not top down, nor is it bottom up, but a synthesis of both.

 

We don’t measure ourselves against our industry so much as against other great businesses.

 

Leadership is the work of understanding people with different backgrounds than you, listening instead to other points of view, and developing awareness of what your employees need to flourish.

 

Investing in employee development is also essential to understanding and exceeding customer expectations…

 

Leadership scholars, including Claudio Fernandez- Araoz, Boris Groysberg, and Tricia Greg, have conducted studies showing that a relentless thirst for knowledge is essential. Leaders cannot afford to have outdated skill sets and must constantly seek knowledge.

 

Mentoring is not a bolt-on or afterthought for a business today. It is inseparable from everything you do.

 

Mentoring is a concept we had from the beginning. We want to help people develop their careers here in the way that they want to take their career, what’s attractive to them, what they are passionate about. Mentoring is part of how we help them set goals and achieve them. It’s a part of our company philosophy, and we continue to develop the program… Over time we have added outside coaches to help our top leaders.

 

Pairing non-direct reports with mentors is far more effective, allowing more openness and objective feedback and providing opportunities to develop relationships outside the reporting structure.

 

Every employee will have concerns about their career; While roadblocks can be discouraging, they are not insurmountable. With perseverance, proactive strategies, and a willingness to learn and grow, individuals can navigate these career obstacles: a formal mentor program accelerates this process for your employees, who will want to build their future with your firm.

 

Remember that mentoring is a partnership, not a directive relationship. Respect your mentee’s autonomy and allow them to make their own decisions and choices. Offer guidance and support without imposing your views.

 

Ware Malcomb has held leadership meetings 3 times a year since circa 1995, a few years after Jim and I were promoted. The idea came to me in a modest flash of light: let’s get the senior leaders in one room for a few hours to make sure we are all going in the same direction…You’ve read about the fleet of ships. I launched the metaphor at one of these meetings as an opportunity for leaders to improve communication and alignment. It’s about sharing information, identifying objectives, and aligning priorities it’s about unity and a shared understanding of vision and mission. Working together. Supporting each other. Shifting quickly together when needed.

 

One of the best ways to introduce new concepts and strategic directions is through a focused retreat where people can gather in person. This retreat allows for knowledge sharing through various methods, including speaking opportunities, breakout sessions, design presentations, informal conversations, and a structured feedback process.

 

Our Leadership Conference provides uninterrupted time and space to brainstorm, exchange ideas, and develop innovative approaches to business challenges.

 

In one of the annual meetings, we build the mind map, which is part of our strategic planning process… In a mind map, the central topic is placed at the center of the page or screen, and related subtopics radiate out from it in a hierarchical or interconnected structure. The subtopics can further branch out into sub subtopics, forming a tree like structure. Each branch or subtopic is typically represented by a word or short phrase, accompanied by relevant images, symbols, or colors to aid in memory and understanding.

 

At Ware Malcomb, every leader is encouraged and expected to develop or hire a second in command (#2 or Number 2).

 

Having a Number 2 is how you train your replacement. A leader cannot grow into the next big opportunity without a strong person to backfill their current role.

 

The Number Two goes beyond “task.” Number 2 is your partner reporting to you but offering a far greater span of reliance across roles and responsibilities.

 

The chessboard is a metaphor for employees on the management track available for different career moves in their company’s interest… Sometimes it meant they had to move across the country and open a new office, or maybe they were in an established office somewhere and we needed to move them to another office to take a leadership position. We move them around for the best advantage of the company and their career.

 

Chapter 4 – Layering Personal and Financial Health

Maintaining balance in life is not limited to just family and health. All aspects of our lives, including relationships, finances, and professional experiences, contribute to a healthy ecosystem that supports us. When these layers are imbalanced, conflicts can arise.

 

Strong relationships, finances, and health are the foundational pillars of success and happiness.

 

I mandated that every board of directors member produce a comprehensive personal financial statement, keep a close eye on their assets and liabilities, set measurable success goals, and share it with the rest of the board annually. Why? The aim was twofold: first, to guarantee that each of us is on the path to financial stability for our families, and second, to ensure that the firm can navigate a recession, we must have the flexibility to temporarily suspend our salaries without risking our personal finances.

 

Over time, as CEO, I realized that it’s also important for all of our leaders to be financially responsible and not overspend. This ensures that their personal financial situation doesn’t become a distraction from their leadership responsibilities.

 

Here are some steps you can take to manage your finances effectively:

• Create a personal financial statement and update it every quarter
• Make a monthly budget that includes your income, fixed expenses, variable expenses, savings, and contingencies. Keep updating it as your circumstances change.
• Make sure your mortgage or rent payment does not exceed 28% of your gross salary, and avoid interest-only mortgages
• Develop a habit of saving regularly and open an investment account to save a certain percentage (10 to 20% ) of your income. Don’t use this money; Let it grow.
• If you receive an incentive or performance bonus save most of it and only spend a small portion (10 to 20%).
• Maximize your IRA’s and 401(k)s every year and don’t touch the money saved
• If you have dependents, get life and disability insurance.
• Get an umbrella insurance policy.
• Buy cars that you can own and maintain even after the loan pays off. Keep them long term; Don’t flip them every two to three years.
• Keep two credit cards: one with flight miles and the other as a backup.
• Set up a revocable trust. A revocable trust is a legal arrangement where a person transfers ownership of their assets into a trust during their lifetime. This trust offers several benefits, including avoiding probate, maintaining privacy, planning for incapacity, and providing flexibility and control for the grantor.

 

In line with Vince Lombardi’s philosophy, I believe that true leaders are made not born. And to become a successful leader, it is crucial to prioritize self-care. I consider self-care to be an attitude, a mindset, and a way of life that requires training, effort, and a commitment to oneself.

 

Here are some self-care ideas:

• Make one permanent change to your diet at a time and build on it.
• Consider taking vitamins and supplements daily depending upon your personal situation, such as diet.
• Stay hydrated throughout the day. It is highly recommended that you drink an adequate amount of water stay hydrated and maintain good health. Dehydration can cause several health issues…
• Getting enough quality sleep is crucial for maintaining good health and well-being
• Find an exercise routine that you enjoy and commit to it on a regular basis. Start small and gradually increase as you become more comfortable.
• Spending time in nature can help clear your mind and spark creativity.
• It’s important to prioritize self-care, and one effective way to do this is by getting regular massages.
• Don’t skip your regular doctor appointments, including a yearly physical, dentist visit, eye doctor checkup and any recommended screenings.
• Share your challenges with someone you trust and take things one step at a time… it can be tough to face challenges alone, so it’s always a good idea to confide in someone you trust

 

Work/Life Balance Tips:

• To effectively delegate tasks, it is important to hold people accountable and avoid doing their job for them.
• Avoid being a helicopter manager or micromanager and empower your team by showing them that you trust them. Doing so will encourage your team to take ownership of the work, boost the morale, and foster more positive work environment. So, resist the urge to micromanage and embrace the leadership style that empowers your team to shine. This will help you stay focused on your own work without overloading yourself.
• It is important to guard against overworking yourself and becoming a workaholic. Identify a trusted person who can help keep you accountable and support you.
• Take a break from your technology and avoid sending digital communication outside of normal business hours.
• Commit to a schedule: for work hours, for exercise, for family time, and for screen time.
• Be efficient: when making decisions, by striving not to revisit issues more than once, but cleaning out your inbox (defeat the tyranny of email)
• Schedule vacations and take them: no emailing on vacation, no calls on vacation, set expectations before you go, and use the time as a chance to empower and test your people.

 

Attitude Advice:

• Avoid beating yourself up about any of these issues: it’s a journey and stay positive
• Adopt an optimistic attitude
• You are setting an example for your team. This is very important. Your attitude affects them, for good or bad. Feel good about yourself and all you have accomplished. You are awesome!
• Adopt an attitude of gratitude
• Adopt an attitude of continuous improvement

 

PART TWO: DEVELOP A VISON, BUILD A PLAN

Chapter 5 – Strategy By Design: The Planning Layer

It is crucial to maintain a forward-thinking mindset. Your attention should be directed towards your vision of where your company is headed, how you want to get there, and how to consistently achieve the goals that you set.

 

A well-crafted business plan should never be filed away and forgotten. It should be a living, breathing document that is continually updated with progress as well as setbacks and used to guide your decision-making process.

 

Accountable is described by Webster’s as containing the meanings answerable, responsible, and explainable. In running a business, executing against strategy in this way means doing all three: explaining one’s decisions, answering to them, and being responsible for them.

 

Lawrence Bossidy and Ram Charan changed business history with their book Execution. They wrote, “If you can’t describe your strategy in 20 minutes, simply and in plain language, you haven’t got a plan.”

 

One effective approach is to analyze both successful and failed businesses to determine the factors that contributed to their outcomes.

 

Throughout the strategic planning process, start and end with the guiding principles used by many successful companies.

 

There is no process execution without close coordination.

 

I have observed that many giants in our industry have a slow-moving approach, like that of an ocean liner. On the other hand, our team is like a fleet of smaller vessels that can move quickly and make course corrections when needed without losing speed.

 

The specifics of each plan may differ depending upon the market and the size of the office.

 

Our strategic plans are scrutinized to ensure they are ambitious yet realistic and achievable, with the ultimate goal of driving growth and success for our business.

 

We used the leadership meetings to discuss changes, gather ideas, and issue new directions for our fleet of ships.

 

We understand that struggles are part of the journey, and when our colleagues face roadblocks, we strategize around them and find a way forward.

 

We aspire not to work in silos and believe that success is both an individual and team achievement. As a result, we are always connecting the dots for our national clients, ensuring that we’re always in motion and consistently making progress.

 

To achieve a dominant market share, it is essential to understand and define your target market… the first step is to focus on your core customers and build out from there.

 

Ware Malcomb strategically chooses office locations based on our market research, including locations where our best customers have a presence. We survey our competition and find opportunities to fill gaps in the market.

 

Selecting the right local office leader is paramount and forms the first layer of strategy.

 

Carefully diversifying beyond our core market is critical to sustaining competitive strength.

 

As a leader, it’s crucial to develop a clear vision for your market and how your company can improve its understanding, growth, and protection.

 

We continuously strive to learn and develop how to best serve our clients on our terms and through standards that mesh with our culture.

 

We aim to avoid groupthink and focus instead on what’s best for our company and clients.

 

We developed the flag with arrows pointing in One Direction, except for one arrow (representing WM) that goes the opposite way. This symbolizes our rebellious approach to constantly rethinking and adapting.

 

Sometimes, making tough decisions is necessary, but it’s not just about people. It’s also about being quick to adapt to current and future needs.

 

Another aspect of being a smart contrarian: avoid imitating other competitors or expanding into markets where you lack historical expertise.

 

A useful approach to obtain knowledge about your market and the elements that influence the success or failure of related businesses is to carry out a de-layering analysis. This involves closely examining and comparing two similar competing companies, such as Home Depot and the now-defunct HomeClub, which were established around the same time and shared comparable business objectives. By analyzing the differences in their approaches and outcomes, you can better understand the factors that lead to success or failure in their industry.

 

A huge differentiator for Home Depot was its customer-centric business model. Home Depot focuses on providing a wide selection of products, competitive prices, and excellent customer service to cater to do it yourself (DIY) customers. Home Depot organized the value proposition around the customer.

 

Another factor that contributed to Home Depot success was his strong branding and reputation. Home Depot invested heavily in branding and marketing to establish itself as the trusted and recognizable brand in the home improvement industry.

 

Home Depot expanded aggressively, strategically locating stores in high-traffic areas.

 

Home Depot’s team had a strong vision and executed well, staying ahead of the competition by responding to market changes in customer demands.

 

Home Depot offers not just products and services but solutions too.

 

Once you have rigorously identified and communicated the heart of the market where you want to succeed, then you pursue your competitive advantage and eliminate competition. One way to do this is to swim to blue oceans—that is, to find untapped markets and niches that aren’t already saturated with competitors. Another key strategy is to leverage client relationships, building trust and loyalty with your customers to keep them coming back for more.

 

The concept of Red Oceans refers to industries that are currently established and competitive, while Blue Oceans refer to untapped market opportunities that have yet to be explored.

 

The concept of blue ocean strategy involves reconstructing market boundaries to break away from typical competition… Additionally, it is essential to reach beyond existing clients and actively seek out non-clients.

 

As a company, we deploy LCR (leveraging client relationships) to transfer a client relationship from one part of the company to another, with the ideal outcome being that all officers in the organization will be working with this client. This approach may seem simple, but it requires a One Team attitude culture and focused hard work to make it a reality.

 

LCR is a specific strategy that we employ to ensure that we’re taking full advantage of our client relationships and leveraging them for the benefit of the client and the organization.

 

Whether you’re in a big or small office, there are always diversification to add, and you’ll never run out of opportunities to keep building market share that’s in line with your vision.

 

Successful companies achieve competitive advantage by facing reality, tracking progress against goals, and understanding the factors that lead to success or disappointment. Executing a strategy involves aligning people with goals and achieving results. Unfortunately, many organizations are full of people who try to avoid or shade reality, therefore eroding trust and cooperation throughout the firm.

 

As you strive to dominate a particular niche, insist on consistency, quality, and responsiveness to clients.

 

Leaders must regularly check in with their team to ensure everyone is on the same page. Respond promptly to any opportunities or concerns from clients to maintain their trust and loyalty. Hit your marks; Make your deadlines.

 

Layering business development and operations must be done in balance. If you’re hard-charging business development executives outrun the operational folks, client work may suffer. To illustrate the concept to our leaders, I turned to one of my favorite childhood cartoons, called the Roadrunner and the Coyote. Business development is the Roadrunner; Operations is the Coyote. The Coyote can never cast a Roadrunner, but he must never be too far behind; otherwise, your operational wheels fall off, and your performance drops.

 

We encourage our team members to face challenges head-on and tackle them as soon as they arise. We believe that delaying a response only exacerbates the issue. Hence, we have trained our team members to be proactive and address any problems that may arise immediately.

 

As a people-focused business, we prioritize building strong relationships with our clients, consultants, contractors, and city building department personnel. Trust is an essential component of any success relationship, and we strive to maintain it with all of our stakeholders. When an issue arises, we believe that working together to find a solution is the best approach.

 

In the words of the grand Dean of Execution, Larry Bossidy, leaders must “be in charge from the start of each cycle to the reviews and to the follow-up steps you take to make sure the things are supposed to happen due, in fact, happen. This is how you acquire both the knowledge and authority to run the business as an integrated, reality-based whole. It is how you ultimately assure that all three processes are linked.”

 

Chapter 6 – Master Strategy: Achieve Daring Long-Range Goals

“Follow these four steps and there’s nothing you can’t do,” Walt Disney said. “First comes the thinking. Get this wrong and you’re sunk. Think the right thoughts and you’ll come up with the right ideas to pursue. Then believe like you’ve never believed before. Fall short on your belief level, and you’ll never make it. Next, dream of how you want it to be. Right down to the last detail. And last but not least, dare to present your idea to the world and make it all happen in reality so you can benefit from it.”

 

Once we became proficient at annual planning, we began to focus on the bigger picture: What does this add up to in the long term? What are our five-year goals?

 

Our strategy remains in effect: on diversifying our service lines and products to stabilize and expand our platform in important markets across the Americas. These are our blue oceans and the main drivers behind our success.

 

We established “WM structure,” a summary of different Ware Malcomb office prototypes to assist in planning and growth objectives. Parameters for each type of office included leadership objectives, management priorities, revenue and headcount benchmarks, market and geographic diversification, and LCR strategies and organizational structure.

 

Our regional offices strove to expand business across all of our service groups: master planning, office, distribution, medical, retail- big box, retail- auto, and interiors. The offices fell into four classifications: (1) satellite office – focusing on the core business with the goal to become 80% architecture in 20% interiors, (2) small office – focusing on new core areas of industrial, technology, Class A office, auto and graphics with 70% architecture and 30% interiors and a goal of 1 to 2.99 million in revenue, (3) medium office – focusing on new industrial build to suit projects, office projects, and full service interior design, with 60 to 65% architecture and 30 to 35% interiors the goal of 3 to 4.99 million in revenue, (4) large office – focusing on new industrial, MOB, auto dealerships, interiors, technology, BTS, retail, and graphics with 65% architecture and 35% interiors and a goal of 5 million plus in revenue.

 

With these new structures in place WM expanded to new locations in our target markets. By opening new branches in these areas, we were able to increase our service offerings and market share. Our regional leaders played a crucial role in securing new accounts with established clients and expanding business and the interior sectors. These efforts enabled us to establish ourselves as a leading service provider in our industry, putting significant distance between us and our competitors.

 

Ultimate Ware Malcomb is the embodiment of our greatest dreams, including a map, an organizational chart, expected revenue, and aspirational goals for our company.

 

A last piece of advice from Walt Disney, “Everyone needs deadlines, even the beavers. They loaf around all summer, but when they are faced with a winter deadline, they work like fury. If we didn’t have deadlines, we’d stagnate.”

 

Chapter 7 – Teams, Not Rivals: Building A World Class Executive Culture

Converting a team of leaders requires 5 essential practices:

1. Identify the values and behaviors that form the cultural foundation of your company, as they support your operations and profits
2. Assemble a diverse executive team from within your high performers. Your executives should each bring new ideas and perspectives to company policies. Including different perspectives and regions is vital.
3. Select each person carefully based on their performance and their ability to work collaboratively.
4. Provide your senior leadership team with the resources and support they need to be successful. This includes providing them with training and development opportunities, as well as giving them the authority to make decisions.
5. Hold your senior leadership team accountable for their performance. This means setting clear expectations, providing regular feedback, and taking action when necessary.

 

Recruit and nurture your leaders as if your company’s future depends on it. After all, it does.

 

Our executives and shareholders’ commitment to success is defined by their continuous hunger for personal and professional development.

 

Each of our executive team members embraces personal and professional growth by taking on new challenges—behavior that lies at the heart of our firm. There are always willing to step up and do what is required.

 

Make sure that your potential leaders are capable of driving business growth.

 

Our approach is to create opportunities for those that show ambition, perform, step up, and get our culture, without limiting who they are or where they come from.

 

An influential article from the Harvard Business Review found that diversity leads to better team decisions.

 

The top team in the company consists of the senior leaders, while the department level comprises the top managers. A wide array of skills, perspectives, talents, and learning styles among these teams leads to innovation and effective management.

 

I find that with different skill sets and perspectives, executives bring unique ideas and approaches to discussions about the directions and policies of your company.

 

Expect and encourage your leaders to be vocal about their opinions with each other and to their superiors as well; Otherwise, the value of this strategy is muted.

 

When it comes to business, we often focus on our success stories, role models, and top performers. These examples are important for teaching and training. However, it’s equally important to acknowledge and discuss behaviors that don’t align with our company culture and explain why. Sharing and remembering these examples can help us create a more cohesive team.

Not everyone you hire will qualify for leadership track, and that’s okay. As people progress or have opportunities in the firm, their attributes show themselves. Many terrific professionals have focused skill sets that serve them well in their position… Many talented and prolific professionals aren’t suited for leadership but are committed to growing and developing in their niche.

 

Some individuals have struggled to work as team members, putting personal success and individual credit over the greater good of the team, department, and organization. This attitude undermines the core WM practice that involves serving clients across many different markets…. We’ve had employees who attempt to hold on to projects and complete them themselves even if it’s not in their area specialization. This type of behavior is referred to as “revenue hoarding” and “ball hogging,” which goes against our cultural values and expectation of teamwork

 

if a group leader fails to act as a team player, they create a silo that goes against our cultural values. We’ve had promising hires who attempt to change our firm to fit their previous workplace, and this rarely works out.

 

We incorporate tools like CliftonStrengths help us understand our employees better but ultimately, our company culture is what sets us apart. When we promote from within, our employees are integrated into our culture and model it. However, when we hire senior level employees externally, it’s up to both the individual and the company to ensure that they adapt to our culture and in value to our team.

 

Our executive team works in a constant dialogue of support, including the CEO. Support is also evident in how colleagues help each other with strategies, financial issues, and life balance issues. We have support solutions available throughout the company, from production to marketing to legal and contracts.

 

Although we don’t have limitless resources, we have designed our system to scale based on revenue. We understand that deadlines can clash, and we plan for these scenarios by incorporating safety valves in our system. For instance, we outsource production outfits to provide extra capacity when necessary. It’s worth repeating: expand your bench of outsourcing resources as your business else.

 

When extra capacity is needed on a major deadline, team members companywide may jump in at the request of the office leader, the production studio, or the head of the design studio. We may ask employees to work overtime or reach out to other offices or outsourcing groups for assistance. While it’s not ideal, sometimes we may also need to request an extension from the client. However, we always strive to meet deadlines and fulfill our obligations. When we fall short, we work hard to make up for it and maintain a positive relationship with the client.

 

Sometimes, leaders must make sacrifices to support their teams at high-stakes times. At Ware Malcomb, board members and leaders take the first salary cuts during a recession.

 

Chapter 8 – The Visible Light Spectrum

I’ve found the visible light spectrum tool to be one of the most powerful tools I’ve shared at Ware Malcomb. Visible light waves are the only electromagnetic waves we can see, appearing to us as colors of the rainbow. When all the waves appear together, they produce white light. The rainbow colors represent the core businesses where a company excels, as well as strategic, closely aligned diversifications. For Ware Malcomb, our visible light spectrum encompasses the services we offer: architecture, interior architecture, civil engineering, branding, and building measurement services, as well as services for commercial real estate. Just as importantly, it represents the commercial real estate product markets we design in: industrial, office, advanced manufacturing, retail, healthcare, science, and technology. It’s a metaphor from high school physics class that asks: Can you visualize a business opportunity or new product market on your company spectrum? Or is it invisible, too far outside the visible light?

 

Ware Malcomb understands the ups and downs of the economy and the impact it can have on the industry. To prepare for potential recessions, the firm strategically diversifies its services and competes in closely aligned sectors that provide a buffer against economic downturns.

 

Leaders need to be bold explorers of new business opportunities that will diversify a client base and ensure income streams during hard times. The visible light spectrum process delivers filters to help curious theaters make decisions, such as:

• How can your business diversify to sustain itself through all the phases of the economic cycle?
• Can you be a leader in this market niche?
• Is this possible diversification closely aligned with your core business?
• Is this possible diversification closely aligned with your core culture?
• How do you assess whether a new business line that you are considering is a good fit for your business or business group?
• What acquisitions fit your core strengths?
• How can the visible light spectrum enrich leadership?

 

Diversification is time-consuming and involves trial and error, failures, and, hopefully, eventual success. So, any new area we ventured into had to be related to business sectors we already excelled then, and we should see a path to becoming a market leader… We didn’t want to just dabble in different market sectors; We wanted to be a leader in every aspect of our work.

 

Tap into in-house leadership and expertise. When an organization commits to the leadership development and training principles discussed in this book, your team can be a great place to find ideas for countercyclical diversification.

 

When you diversify, stay close to your core competencies and instill the strategy into ongoing operations and growth strategy…It’s essential for growing businesses that are considering acquisitions to carefully evaluate the expertise they are adding. I have seen companies make the mistake of adding businesses that have no relation to their existing operations which can lead to difficulties in leadership style, management, and culture.

 

We specialize in designing various types of buildings, such as industrial buildings, high-rise office buildings, advanced manufacturing buildings, science and technology labs, retail facilities, and healthcare buildings. These different building types require specific criteria and requirements for their mechanical electrical engineering therefore we hire firms that have expertise in each of these areas…We prefer to have a stable of consultants based on their expertise that we can hire when needed. This approach gives us the flexibility to work on different types of buildings with other requirements. If we designed only one kind of building, such as schools, it would make sense to have engineering in house. However, since we have a diverse portfolio, it is more practical to hire consultants.

 

It’s important to diversify in terms of the services you offer, not just the product type.

 

Whenever we consider expanding our company, we discuss how it relates to our current services, whether we can excel at it, and whether there is demand for it in the market. A lot of design firms make the mistake of saying, “We do everything.” We didn’t do that, and neither should you.

 

Use this list to assess diversification opportunities:

• Is the new project related to your core business?
• Can the firm be a leader in the market sector where the new opportunity is located?
• Does the firm have relationships within the market sector?
• What are the brand implications, from positive to negative?
• What is the strategy for meeting client expectations and gaining additional business?
• What are past insights from related client work? Share with the leadership team.
• Can you deliver the services in this business competitively, efficiently, and profitably?

 

The visible light spectrum is a helpful frame for thinking about external acquisitions (by service or geography- we’ve done both). We believe it is key to diversify and pursue growth opportunities that help relate to (1) your corporate identity and (2) corporate expertise, because the culture of your company is tuned in to your core business. Bad acquisitions can become a virus that pollutes and weakens your culture, and even those that both parties embrace can pose significant issues of cultural compatibility.

 

Ware Malcomb weaves diversification into our leadership meetings, where strategic plans are formulated. New offices tend to be mostly built on the core business, so they need to add diversification. At this level, we’re not talking about inventing a new diversification. It’s more like adding healthcare, for example, to an office that hasn’t been offered before… Each office will have its own diversification priorities (within the WM portfolio) based on its respective market.

 

According to an article by James Schrager, a professor of entrepreneurship and strategic management at the University of Chicago Booth School of Business, “The lesson here is clear. However big you are, however successful you are today, and however thoroughly you dominate your sector, plan for a time when your current strategy no longer works. Change always happens, and this means that strategies must be renewed and revised. Corporate leaders need to ask themselves: what is the pipeline? What is driving growth? What are we going to run out of?

 

Chapter 9 – Making Innovation Work: How To Ember Creativity Layer By Layer

In our system, leadership infuses layers of innovation into each department and function of the organization. The attitude of innovation permeates our entire culture.

 

Significant brain science in the field of leadership points to the wisdom of nurturing innovation in every organizational layer. Creative energy is released by self-solving problems and being recognized for contributions. Everyone has their own unique creative processes that should be recognized, appreciated, and encouraged.

 

… humans are naturally inclined to cooperate with others to find solutions to complex problems. This innate desire to work together toward a common goal should be recognized and encouraged. This is regenerative innovation, which fosters creativity and transforms the entire understanding of culture and leadership.

 

.. When the company needs to problem solve or innovate, we bring the executive team together for an unstructured, preliminary discussion without a lot of agenda. An idea could come from anyone in the room that had an inspiration. The rest of the team will build on that idea and offer suggestions. Then we figure out the next step or steps and who will implement them and by when.

 

Creativity is served by keeping meetings short and to the point… I recommend exciting and fast-paced discussions that lead to action.

 

Innovation involves discovering novel approaches and solving problems. It also requires setting an example by developing creative ways of doing things in every facet of work.

 

… technology must be part of every process of change with which your firm is involved. In 2024 and beyond, if you are not a technology company, you’re not a company. Leaders must emphasize that change and innovation require embedding capabilities like mobile apps, AI systems, and algorithmic tools across the business.

 

Activate your people in every layer with three deployment steps:

• Encourage and reward participation; Motivate everyone to come up with new ideas to improve your company.
• Solicit a variety of ideas. Some are easy. Some are harder. Some are great, but harder to implement. Evaluate which ideas will make the most impact the fastest.
• Then, as you implement, integrate the best technologies to reduce clunkiness and improve efficiency.

 

PART THREE: STRATEGIC GROWTH

 

Chapter 10 – Embracing Your Hedgehog: How to master the Disciplines of Growth

As Jim Collins discusses, the hedgehog concept is a simple yet powerful idea presented in the book Good to Great. It results from a deep understanding of the intersection of three circles: (1) what you are deeply passionate about, (2) what you can excel at, and (3) what can drive your economic or resource engine.

 

According to Collins, it is essential to note that a hedgehog concept is not about being the best, having the best strategy, or setting the best intentions or plans. It is about understanding what you can excel at and what you cannot.

 

We (Ware Malcomb) adopted 4 axioms as the foundation of our hedgehog principle:

• Axiom #1: New leaders should identify their most valuable market (LCR) niche and collaborate with colleagues to assess strengths and weaknesses in these relationships.
• Axiom #2: Focusing on client service is critical. Client service should always be our top priority. Losing a client implies failure.
• Axiom #3: Building the right team is vital. We should always have the best people in our group and continually identify and mentor our replacements. This is the only way to grow.
• Axiom #4: We are business people. We must learn and practice the best business and management techniques and continually update our knowledge by reading business books, periodicals, and newspapers.

 

Our baseline philosophy has always been to instill in our client-facing teams the importance of understanding our clients’ goals and helping them achieve them… Rather than focusing solely on our own goals or trying to sell an expensive service to our clients, we prioritize understanding their needs and helping them reach their desired outcomes.

 

Ware Malcomb offers a boot camp for project managers and job captains. It’s a training program where we teach our project managers about our processes and expectations when managing projects.

 

In addition to WM Boot Camp, we also have WM Cultivate, which includes a class designed to train new leaders… WM Cultivate can teach them how we want leadership to happen at our company. They will learn how to build and grow a team, handle clients, and ensure quality control.

 

Another program we have is Ware Malcomb University (WMU), a virtual weekly training available to all team members on a wide variety of topics, including technical skills, growth, and health.

 

Other WM programs to promote personal and professional development include:

• WM Emerging Leaders (ELP): the annual cohort-based program identifies high-performing, high-potential team members and enhances their leadership skills through education, engagement, and personal and professional development.
• WM Mentoring Program: as discussed earlier in our book, this company-wide mentorship program was developed in 2012 to provide team members with one-to-one coaching and guidance from experienced leaders throughout Ware Malcomb.
• WM CliftonStrengths: Ware Malcomb believes that discovering and developing unique talents make team members more successful. To achieve this, each team member is provided with a copy of CliftonStrengths, and a specialized report is generated with their top five strengths.

 

When we establish a new office, we ensure we have a skilled and experienced leader who believes in our program, culture, and mission and can inspire their team to do the same. Our office leaders must exude these qualities every day to their team members. It’s helpful to consider leadership development concepts as layers that are synthesized into your culture and growth strategy.

 

When we open or build an office or have an office that isn’t doing work with a particular client, but we’ve done successful work for this client elsewhere or in several markets, it becomes easier for the client. The key is to eliminate friction for the client… It is much easier for clients to work with us than to hire another firm in a new market.

 

Having the right combination of a good leader with the right skill sets and contacts in each market is crucial. When these leadership attributes are combined with the strength of our platform, it sets the Condor into flight, a rising sustainable growth rate lifting us above the competition.

 

Unfortunately, many successful people tend to lose their way because they start thinking they’re invincible and that the world owes them everything. This attitude is dangerous and can lead to their downfall. It’s important to stay humble and grounded and avoid letting your ego take control.

 

Success is a team effort that involves a combination of factors such as strategy, culture, the philosophy, the platform, and the talented individuals within the company. It is crucial to understand that if one person thinks it is all about them, it is destined for failure. It is essential to cultivate a culture of humility and remind ourselves that we are lucky to be part of a phenomenal company supported by many incredible people.

 

Embracing the idea of empowerment is crucial to creating a healthy work culture. It requires humility to hire people who are smarter or better at certain things than oneself and possess capabilities and talents that one lacks. It’s important to empower and guide those individuals by providing necessary resources such as training, mentoring, coaching, and guidance…It’s important to provide guidance, regular check-ins, and accountability while allowing new team members to take on new responsibilities. Delegate don’t abdicate.

 

Simply injecting one idea, such as a 360° feedback model, into a bad culture will not work. The concept must fit in with the organization’s overall culture and fundamental philosophy. We have learned a lot from various business books and examples of successful companies, but we have always customized them to fit our needs. We have made them our own by adding our unique touch just as we did with the blue ocean and other concepts… Understanding that what works for one company may not work for another is crucial.

 

When facing rapid growth, how can leaders anticipate challenges in their development? The challenge lies in performing and delivering results quickly.

 

To recap, when the flywheel spins and double-digit growth takes flight, the following are critical:

• A trained veteran leadership team
• Thoroughly tested customer service and customer experience practices
• A training pipeline
• Established communication protocols and practices: supervisor the supervisor, supervisor direct report, unit to unit, leader to leader, team member to client, team member to vendor; and
• strong operations leadership and communication channels to sales or business development

 

Chapter 11 – Many Markets: Layering Strategies for Sustainable Expansion

Expansion is also attempting new chapter to add to your brand story. But success comes down to answering the fundamental questions for understanding and executing any strategy: how, where, when, and why do we carry out the decisions? How do we manage our resources and avoid overspending?

 

We used to choose our locations based on the requests of our clients or our knowledge of a particular market where a group of clients had a strong presence… however, we soon became more proactive in our approach and identified priorities for our next locations as work came to us. If we had multiple projects in a particular market, as well as several existing and target clients, we would establish a presence there.

 

We developed a strategic map to identify markets with a strong commercial real estate industry, as well as Fortune 500 footprints, where our clients were active, and where there was a gap in the market.

 

To solidify your planning for expansion, it’s important to consider several significant factors. One of them is tapping into existing relationships with regional players in your industry… Another factor to consider is compiling economic, industry, and socioeconomic trend data as part of your feasibility study.

 

WM has national relationships with commercial brokerage firms such as CBRE, JLL, and several others. When considering entering a new market, we meet with representatives of these firms and others, gather referrals from those companies, and ask them about the market. We want to understand the long-term validity of the commercial real estate market in that area.

 

While we do work in markets where we don’t have an office, we find that once we begin to build market share, having a local presence is the most effective way to serve our clients and achieve our long-term goals.

 

The new manager’s onboarding process will depend on whether they are an internal hire or someone we’ve recruited externally. In case of an internal hire, they will need to familiarize themselves with the local community and market on the other hand, if we have hired someone from the outside, they will already know about the market, but they will need to learn about WM’s specific needs and requirements and our culture.

 

When opening new offices, we start with a team of two to three people and quickly acquire space in the coworking facility. This allows us to stay agile and move swiftly. Once we’re ready, we will move to a more permanent lease space that fits our specific needs. Every office must prove its value before moving to a permanent location.

 

Ware Malcomb has created various office structures that cater to different stages of office development, be it a startup, a small or medium-sized office, or a large office. We have established prototype steps for each stage, which enables offices to observe another one of our offices that is one step ahead of them in growth and learn from it.

 

After the deal is completed, all departments, including HR, IT, marketing, production support, and design support, work together closely to ensure a smooth integration with the acquired company.

 

Howard Schultz of Starbucks observed that expansion isn’t a strategy, he said; It is a tactic as part of a growth strategy. Keeping that in mind, having a spirit of possibility for your business is a true animating force.

 

Chapter 12 – Succession, Posterity, Prosperity: The Final Layers

Delegation and succession planning can be a complex and challenging period to avoid confusion, delays, or disagreements; it is essential to have a clear plan in place and work toward it well in advance. Delegation is a crucial part of succession planning and serves as a model for the change. It’s a learned skill that requires dedication and effort to achieve success

 

From designating a Number 2 to retirement, succession planning is an important part of Ware Malcomb’s culture and a key driver in our leadership Academy and other initiatives. It was obvious to me that I needed to plan and prepare for succession well in advance, working with trusted advisors and the consultation of the board.

 

An article by Deloitte analysts argues that succession planning is all about preparing your organization for the future by identifying and developing talented individuals who can step into any key roles when needed. It’s not just about having a backup plan for when someone leaves, but also about building a diverse and strong leadership pipeline that can make better decisions and contribute to a positive organizational culture.

 

The costs associated with poorly managed CEO and C-Suite transitions in the S&P 1500 amount to close to 1 trillion dollars annually, according to a 2021 feature article published in the Harvard Business Review.

 

I always start our meetings with a brief discussion about the company or whatever is on my mind. So, this early Thursday morning, as I walked into the meeting, I looked out and posed a hypothetical scenario to my colleagues. I asked them, “I just got hit by a bus.. What happens now?” Then I walked out of the room, and I gave them 10 (ended up being 20) minutes to come up with an answer.

 

I made the decision to step down as CEO while I still had the energy and drive to keep going. I love the job in every way. But it’s important for a company to avoid stagnation, which is why I didn’t want to hold on to my leadership position for too long. In our industry, I’ve seen many business leaders make the mistake of holding on for too long and not making the necessary arrangements for a smooth transition period to avoid this scenario, I decided to transition and become the Chairman instead. This way, I continued to offer my help and guidance to the company while allowing new leaders to take charge, build the company according to their vision, and ensure a controlled and successful exit strategy.

 

Serving as chairman doesn’t give me the license to micromanage or interfere.

 

Indecisiveness in succession planning can lead to a lot of problems, and it’s always better to be prepared than to be caught off guard.

 

We began planning this transition when I was 57 years old. My buyout began at 60 years old, and I transitioned from CEO to chairman at 63. Will be done when I’m 70.

 

As the person leaving, you need to have confidence that you will get paid, especially if you are selling internally. You have relinquished control of your business, and you must trust the people you have turned it over to will do a good job and get you paid. We did not take on any debt to complete this transition.

 

Succession is critical for everything that makes your company what it is. In order to ensure the success of your company, you must be willing to put in the hard work required to find the best people for the correct roles in the firm and then relinquish control.

 

I recommend that a succession plan include these elements:

• Establish a working group that will meet regularly, most likely members of the board and those you’ve chosen as successors.
• Establish an atmosphere of openness and trust so all participants feel comfortable asking questions and showing concerns.
• Develop contingency plans for sudden leadership changes or emergencies to ensure the organization can respond effectively to unexpected situations.
• Identify high-potential or high-performing team members and their potential career paths.
• Identify and appoint a new CEO and any other senior officers, and plan for a six-month to one-year consultation and onboarding process.
• Involve your lawyer and accountant to advise you.
• Work with advisors and the board to write up key responsibilities, milestones, and accountabilities for the CEO and other senior officers; engage managers through the ranks to set new goals for growth.
• The financial terms and timelines of the deal will vary from company to company, including contingencies for different economic and business conditions that may arise during the buyout and transition.
• Develop a thorough, well-planned communications plan.
• Develop a call list of major clients and contact them personally.