Fortune Magazine did a major article on McDonald’s recently that was a real shocker in that it described a leadership crisis that has led to disappointments in the McDonald’s business on many different front. All of this has culminated in a disastrous year for the company. Specifically, in late October it reported its fourth straight quarter of negative same-store sales in its US operations and a 30% decline in the company’s profits. Expenses are growing while revenue are declining, a clear recipe for disaster!
Gutsy Leadership Blog
Recently Harley Davidson, the Milwaukee-based motorcycle company, posted better than expected profits for the latest quarter, with revenue up 3.8 percent versus year ago. Over the past two years the company has done very well, with its stock price going from $39 per share two years ago to $68 per share range.
It was interesting to note that BHP Billiton, the world’s largest mining company as measured by market value, announced recently that it plans to split the company, spinning off BHP’s aluminum and magnesium business, plus several other smaller mining entities. The remaining, slimmed-down BHP will be focused on just four areas: coal, copper, iron ore and gas/oil.
Recently Tesla announced its July-September (JAS), 2014 quarterly results. Additionally, they explained that they now believe they will deliver 11,000 cars in the October-December quarter, not 13,000 as previously indicated. They blamed it on a two week production shutdown in July; raising some eyebrows, since such an event is planned well in advance.
A couple of years ago I read about a company who struggled through all of the classic problems companies encounter when they attempt to improve their performance appraisal systems.
Recently I read about a study among some 600 corporate leaders which concluded that high achievers are often afraid to show their limitations. They let anxiety about possibly failing get in the way of tackling opportunities. They shy away from anything that has any risk to their reputation or requires them to learn new skills (thus suggesting they have a weakness). Instead of pursuing any kind of change, they prefer embracing the status quo, locking themselves into a set of standard routines.
In 2006, Ford Motor Company was in dreadful shape. Its stock price had fallen 50 percent versus just two years ago and the company was on its way to losing $17 billion that year. Fortunately, the CEO, William Clay “Bill” Ford realized his inability to turn things around and hired Alan Mulally who had spent over thirty years working for Boeing in the commercial aviation area. Analysts scratched their heads; how is a non-car guy ever going to save Ford?
For a leader, it is always heartening to have all of the people around you agree that the team is on the right path with no downside risks. The problem is that in many such cases, the culture of the team is such that sceptics just don’t have the nerve to bring up any concerns. It takes a skillful leader to give the sceptics in the group the comfort to bring up their concerns.
In the advertising business, effective frequency is the number of times a person, on average, must be exposed to an advertising message before it is well understood by the viewer. The topic of effective frequency has been studied thoroughly over the past four decades.
Several years ago there was some interesting research on employee motivation that really stuck with me. The conclusions were based on a massive study that involved twenty-six project teams from seven companies, comprising 238 individuals. Each participant filled out a survey at the end of each day, recording their moods, motivation levels, perceptions of the work environment that day, as well as the work they did, the progress they made, and the sense of creative output. The resulting 12,000 diary entries captured many ups and downs and provided a unique look at the inner workings of work life on a micro level.