• Methodology based on Insight’s experience. You save the time it would take to develop, track, and support an in-house performance management system.
• Automated features. Wizards and email notifications provide guidance and reminders, and its documentation and tracking save you the time and hassle of tracking down information and generating reports from scratch.
• Develops better habits. An effective human resources program requires commitment. Small businesses that adopt the right habits and use BLOOM to manage strategic initiatives, roles, and employee performance can save the expenses of an HR person and haphazard in-house talent management systems. Like any tool, though, BLOOM is only effective if it is used regularly.
• Support that small business needs. BLOOM is Software as a Service (SaaS) and includes support services for related management development.

Now we’ve updated our pricing structure to better meet the needs of small businesses. The 30-day trial is free. Take a look at BLOOM to see how you can effectively align your business strategy and employee performance for less than you might expect.

For the American economy to rally and re-establish strong growth trends, we must examine at its foundation: manufacturing. The foundation is eroding at an alarming rate, and rather than reinforcing it we must focus on renovation through innovation.

In his book Saving American Manufacturing: Growth Planning for Small and Midsize Manufactures, manufacturing expert Michael Collins offers ideas to shifting the downward trend, and again we provide an overview so that you have a sense of the kind and degree of change needed and to give you some direction in how your company can be among those that remain strong and competitive in the changing marketplace. The concepts Collins discusses are ones that Insight helps clients explore, and we can help you set your organization on a new innovation track, too.

The Crisis in American Manufacturing

The crisis isn’t the surface symptom of lost jobs, it’s the residual effects on the trade deficit, job creation, and strategic industries (xi). Historically, a large portion of the middle class income came from the manufacturing sector; as that sector shrinks, so does the middle class and its ability to help sustain the economy.

A 1987 report issued by the Office of Technology Assessment as an early prediction that is nearing fulfillment:

During the next two decades, new technologies, rapid increases in foreign trade, and the tastes and values of a new generation of Americans are likely to reshape virtually every product, every service, and every job in the U.S. These forces will shake the foundations of the most secure American businesses. (qtd. in Collins xii)

Why should we care?

Manufacturing touches nearly every aspect of American life in one way or another. Collins notes that, among other things, manufacturing:

• Creates secondary jobs (xx)
• Generates exports (xxi)
• Supports state economies (xxii)
• Affects our infrastructure (xxiii)

More specifically, the report makes four predictions:

1. “Change can lead to wrenching dislocation and pain for workers with obsolete skills, for management unable to recognize opportunity, and for communities where traditional businesses have failed” (qtd. in Collins xiv).The data bears this out. From 2000-2006 the United States lost more than 2.3 million jobs in the manufacturing sector alone.
2. “Change can create an America in graceless decline – its living standards falling below those of other world powers” (qtd. in Collins xv).While the upper class and those with top-tier jobs continue to experience high standards of living, that of most Americans is on the decline.
3. “Change can result in a gap between those fortunate enough to have the talents, education, and connections needed to seize the emerging opportunities and those forced into narrowly defined, heavily monitored, temporary positions” (qtd. in Collins xvi).In short, the gap between those who have and those who don’t is widening.
4. “Will people be able to find a variety of attractive opportunities for work, or will only the credentialed elite enjoy such opportunities?” (qtd. in Collins xvi) More jobs are being lost than college degrees are being issued, which indicates that a college degree does not guarantee a well paying job. Collins notes that reasons for this include the advent of the Internet, which has eliminated many tasks that service industry professionals once performed (xix).

What can we do?

Collins is upfront: it is impossible to save all manufacturers (xi).

Success Through Transformation

1. We Must Grow: stopping the decline isn’t enough.
2. Process Solutions: solutions like lean manufacturing help, but they alone are not enough.
3. All Customers Are Not Good Customers: demands prices so low that profit margin is non-existent are demands by customers you can afford to lose.
4. Finding New Customers and Markets: you must find new, good customers to replace bad ones.
5. A New Organization: focus on exploring new markets and developing new products
6. Mindset Change: be market-driven rather than operations-driven.

(Collins 1-2)

Collins, Mike. Saving American Manufacturing: Growth Planning for Small and Midsize Manufacturers. Chicago: First Flight Books, 2006.

Written by Paul J. H. Schoemaker, Profiting from Uncertainty: Strategies for Succeeding No Matter What the Future Brings, paints a clear picture of how responses to uncertainty can make or break a company.

In this post we offer a taste of the first chapter, “Embracing Uncertainty,” because it addresses many of the concepts that Insight does when we work with clients to grow and transform their businesses.

Embracing Uncertainty: An Overview

There is no sure-fire way to plan for the unknown, but let’s be clear: risk is not the unknown. Risk is calculated by identifying known contributors and variables; uncertainty is the space outside of risk. It is the unknowable. “The most challenging uncertainties that managers face,” says Schoemaker, “are those they haven’t a clue about – when they wake up one day to find that the Berlin Wall has crashed to the ground or to recognize that the Internet has merged or faded as a powerful new market space” (2).

Why should managers focus on something so unpredictable as uncertainty?

“Firm-specific actions account for just over half the value of a firm,” and the remainder is attributable to external forces that cannot be controlled, but that a company can prepare for through scenario planning (Schoemaker 6).

A few reasons to give uncertainty due consideration:

• Uncertainty affects the external environment
• The level of uncertainty appears to be increasing significantly
• Humans have inherent limitations in dealing with uncertainty 
(Schoemaker 5).

It is also, says Schoemaker, the only source of superior profits (3). A brief look at past examples reveals that stakes are high and that a future that managers fail to see is the one they failed to prepare for (Schoemaker 3-5).

Why is uncertainty increasing?

There are innumerable factors that contribute to uncertainty. A few that are easily identifiable include:

• More complex socioeconomic systems
• New technologies
• Demographic changes
• Changing values
  (Schoemaker 7)

Discomfort with uncertainty is a human response

Humans prefer the predictable. We have myopic eyes that limit our range of sight and timid souls that miss the bigger picture (13). We tend to trust our instincts, but the inherent problem is that instincts develop from past experiences, and uncertainty assumes that the future will differ greatly from the past (Schoemaker 14-15).

Uncertainty = opportunity

You can profit from uncertainties if you’re prepared, and you can prepare with scenario planning. “The less ambiguity we experience, the more we feel a problem can be structured, managed, planned for, and controlled. But competitors can do this as well, so the opportunity for advantage is diminished. We must learn how to welcome and indeed embrace ambiguity” (Schoemaker 10).

Schoemaker’s book includes a number of approaches that help prepare for uncertainty:

• Scenario planning
• Key success factors
• Robustness analysis
• Strategic vision
• Options thinking
• Dynamic monitoring (17)

Schoemaker, Paul J.H. Profiting from Uncertainty: Strategies for Succeeding No Matter What the Future Brings. New York: The Free Press, 2002.

4 reasons why it’s lonely at the top

A variety of unique factors contribute to a CEOs’ isolation from employees, organizations, and their own emotional needs and desires:

1. The nature of their responsibilities and duties can alienate CEOs from other executives and employees. CEOs are privy to highly confidential information that cannot usually be shared with former coworkers and advisors. As a result, “colleagues who were once peers and confidants may no longer be accessible because of confidentiality requirements. What once could be discussed with coworkers is now private, inside information. Social support is often diminished or even becomes non-existent.”
2. CEOs hold positions of power and authority that can lead to their real or felt sense of alienation. While good news can quickly rise to the top, bad news moves at an exponentially slower vertical rate. Jack Welch observes that “bad news festers in the trenches where those who possess it hope they can make it go away before anyone notices.” With lower-level employees guarding higher-ups from bad news, CEOs can find themselves increasingly insulated.
3. CEOs may emotionally isolate themselves to maintain an appearance of confidence. While this tactic may sustain overall morale, CEOs then pay a great emotional and relational cost to keep up the facade. As a result they may experience isolation to do the pervasive but false perception that it is an admission of weakness for leaders to ask questions or to see outside help.
4. Some CEOs struggle with feelings of insecurity, others with their own inflated egos. Some may surround themselves with “yes people” whose constant affirmation may lead a CEO to develop a distorted sense of themselves and the business; such unchecked egos overpower good business sense and jeopardize the organization’s health.

The solution to loneliness and alienation lies in peer groups

Rather than turning to friends or family members for support, CEOs can turn to peers in business who can fully appreciate the situation and provide truly informed empathy.

When considering potential confidants, it’s important for a leader to seek honest opinions and perspectives and to avoid constant reassurance, information isolation, and undermining intentions.

Peer Pressure, Peer Support

Peer groups can provide informed empathy for the isolated CEO that is likely not being provided by other relationships. CEO peer groups are informal gatherings where leaders from non-competing industries meet on a regular basis to discuss their business and personal struggles, share and receive practical advice, network, and generally socialize among equals. They provide a safe forum for CEOs to express their fears and anxieties without risking their business interests or reputations. By expressing their fears in conversation rather than suppressing or denying them, group members can acknowledge their fears as legitimate and appropriate feelings, but also place them in proper scope and context. Not all conversations must be about crisis – nearly any topic is appropriate.

Many such groups require members to sign non-disclosure agreements, thus formalizing a social contract of confidentiality. In the case of publicly traded companies, these groups often prohibit their members from trading in each other’s stock.

Insight facilitates a peer group for CEOs of privately held companies that functions in many ways like an informal board of advisers. “I use Insight’s Chief Executive Series like a board of directors,” comments Jim Abbott, CEO of Nimet Industries, Inc. “Every meeting has new, valuable information, and it has never been a waste of my time. I call the CEO members when I have a problem to solve and need advice. It can be lonely at the top, and it has been great to have this group for support.”

Peer groups constitute a valuable resource of knowledge and experience; CEOs can gain advice from other seasoned businesspeople that have likely faced similarly challenging circumstances. Listening to how a peer solved a particular problem might spark fresh thoughts on a variety of topics. Additionally, the direction of the global business market toward horizontal relationships highlights the importance of the ability to network resources and collaboratively outsource, or “growthsource” non-core needs to the expertise of business partners.

With peer groups comes accountability

Peer groups can provide CEOs, who are often answer to very few individuals, social accountability for constructively dealing with specific problems they’ve shared during group meetings. Although this kind of accountability is informal, it’s invaluable. In sharing his experience in a CEO peer group based in Bend, Oregon, one member shared that “one of our group members knew he had to make a termination . . . At the next meeting the first thing his peers asked was, ‘Well, did you do it?’ The group forces you to take actions you don’t always want to take.” This informal accountability can help motivate CEOs whose energy, motivation levels, and general focus have decreased due to the lack of accountability at the highest level of leadership.