We came across the HIPPO Principle the other day, it’s highly relevant to smaller, private businesses. HIPPO means the Highest Paid Persons Opinion. The opinion of the Grand Fromage is the most important. It’s prevalent in most organisations; the pressures of time, the insecurity of power, the arrogance of experience all mean that the leader of group often imposes his or her will on a group of co-workers without thinking through the consequences. Even worse, employees try and double guess the view of the HIPPO and only bring ideas and solutions that will win their approval. It’s potentially disastrous, think of behaviour of Sir Fred Goodwin at RBS and his single minded management style to realise the danger of a management culture that doesn’t accept constructive challenge well.
It’s a real issue in small businesses. Firstly, the HIPPO in a private business is usually the owner and senior manager, meaning they are all powerful. Secondly, the founder of private businesses have often set the business up in their vision and don’t necessarily want to accept challenge or change. Therefore it’s often easier to surround yourself with people who agree with you, rather than encouraging the difficult git who comes up with a brilliant left field idea that challenges the whole status quo of a business.
However, it’s critical that businesses have processes that encourage self evaluation and challenge themselves. Smaller businesses often succeed by being visionary and the thought leaders in their sector, but to do this they need to constantly evolve and stay ahead of bigger competitors. If they merely follow the pack, they lose any real purpose.
How, as a busy business owner, can you keep ahead? We have a new principle; not from Africa, but South America, the LLAMA principle:
The LLAMA principle: Listen, Look, Analyse, Mentor, Action.
People can confuse leadership with dictatorship. If a leader who shows any sign of weakness or vacillation, it indicates poor management skills. Conversely, our view is that one of the greatest management skills is the ability to listen. Failing to listen to new ideas and advice often stops businesses developing and inhibits growth in value. So it’s important to find ways to actively listen to people within (and outside) a business.
So how do you get employees to contribute good ideas?
It’s a conundrum; I’ve been to countless ‘awaydays’ in boutique hotels around the M25, where people are encouraged to cast off their shackles, think freely and “push the envelope” (I believe it’s called ideation.) Often they are based on false principles, such as there is no such thing as bad idea (which is patently rubbish.) I can honestly say that after having been to more than 100 awaydays, I’ve rarely come across a truly actionable idea. I've heard great thinking from very bright people, but usually the best ideas fail to be implemented.
Why? Largely because unfettered thinking produces unrealistic solutions. We can only come up with ideas that deliver actionable results if we think within practical boundaries of a business. We need to exploit our experience, use real data, speak to other experts and, perhaps, borrow ideas from other places. We need to strike a balance between suffering from closed minds and encouraging people to come up with loads of impractical ideas on the basis that you might eventually find a nugget of gold.
If "awaydays" are ineffective ways of generating ideas and analysing business problems, what’s the answer? Firstly, get people together in small groups and have a very clear & defined brief. Have frequent, short meetings with clear tasks and roles. Set a defined agenda and make people actively prepare. Then LISTEN to them, don't interrupt, don't challenge, just LISTEN. Check their recommendations with external experts; and possibly research the outcomes. This is what we mean by LOOK; try to think in the widest possible context about how their recommendations could work in your specific market.
Then take the ideas away and ANALYSE them, maybe only focus on two or three that might be actionable. Put together small Action teams (who might be different from the Ideas team) and task or MENTOR them to come up with actionable plans that can be implemented. Then find ways to ACTION the ideas and bonus both the team that came up with ideas and the people who made it happen.
Our view is that if you follow an ordered, open process (with an animal based acronym) you have a chance of keeping your business fresh. The most important part is LISTENING.
This leads us to the IGUANA Principle. IDEA GENERATION, UNDERSTANDING AND NEW ACTIVITY. But that’s for another day.
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