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Learn How to Be an Inspiring Leader

February 26, 2019

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on February 26, 2019

What makes a truly great leader? In part, it’s the ability to inspire followers toward an aspirational goal. I miss the inspirational leadership of three former leaders, whose words and their delivery of those words inspired many of us.

Former President John F. Kennedy, in his Sept. 12, 1962 speech, announced the national goal of sending men to the moon and returning them safely to Earth before the decade was out. As a high school student at the time with the goal of going to college and earning a degree in chemical engineering, I was inspired by not only Kennedy’s audacious challenge to overcome the immensely difficult technical and engineering barriers, but also by his confidence that the goal could be achieved.

Former President Ronald Reagan, in his Jan. 20, 1981 inaugural address, spoke of the exceptionalism of Americans in a very positive, uplifting message, describing the “will and moral courage of free men and women,” and how committed we are to defending freedom. Reagan’s eloquent speech was a call to action for all Americans to be the best they could be, and serve as an example for the rest of the world to emulate. He is the president I most admire.

Former British prime minister Winston Churchill on June 4, 1940 delivered his “we shall fight on the beaches” speech to Parliament to rally his citizens during World War II. Churchill’s speech, reenacted by Gary Oldman, in the film, “The Darkest Hour,” is an inspiring example of how a national leader can mobilize a nation’s citizens toward the most challenging goal it has ever faced – national survival. In the film, one can overhear the comment, “He mobilized the English language, and sent it into battle.” Unfortunately, not very many leaders can do the same today.

So, what did Kennedy, Reagan and Churchill have in common? They had wonderful command of vocabulary and knew how to inspirationally communicate their goals and beliefs with emotion in an up-lifting way that won the hearts and minds of their citizens. They united the nations they were leading at the time.

How does a business leader win the hearts and minds of those they lead? How do you become an inspiring leader? Certainly, it takes more than great communication skills. Inspirational leaders have other skills as well.

Lolly Daskal is a leading executive leadership coach and founder of Lead From Within. In her article, “Six powerful traits of the most inspiring business leaders,” Daskal identifies these traits as people skills, credibility, authenticity, emotional intelligence, motivation, and positivity.

Murray Newlands, an entrepreneur, business advisor and speaker, in his article, “Seven characteristics of inspirational leaders,” says that inspirational leaders have a clear vision of the future, express unerring positivity, listen to their people, are grateful to their team, communicate impeccably, are trustworthy, and are passionate about what they do.

Based on my own experience as a CEO and director on the boards of numerous companies, I would like to add to the list of characteristics and traits of inspirational leaders identified by Daskal and Newlands, as follows:

Is genuine in words and actions, and is a person of high ethics and integrity

A leader who is not genuine and lacks ethics and integrity will not earn the respect and trust of the people within their organization. They will certainly not inspire followers to achieve great results. Board members, be sure you hire a CEO with these traits.

Communicates the importance of the company’s goals

The senior leadership team of the company needs to communicate the importance of the company’s goals in both group meetings and in one-on-one conversations with key opinion leaders within the company.

Employees need to feel that the goals are meaningful and achievable and will have a positive benefit for them and the organization. The goals should be aspirational, and stretch beyond the normal reach of individuals.

Identifies the role that employees play in attaining the goal

After completing a new strategic plan, as the recently appointed CEO of PQ Corporation, I communicated the goals of the company to our business units, and just as importantly, the role each business unit had in achieving those goals. The role of our low-growth commodity chemical business was to generate cash flow, through very heavy emphasis on continuous improvement. This cash flow would be invested in our high-growth specialty chemical and catalyst businesses.

After I made my presentation to the employees of our commodity chemical business, one of the employees commented, “This is the first time I was told what our role is in the achievement of the company’s strategic goals.” In my former position as COO of the company, I was too close to the strategic planning process to realize that the different roles of business unit employees to achieve the company’s goals had not been explained to them. All individuals who take part in achieving the goals of the company should have a personal ownership of the role that they themselves play in the achievement of those goals.

Frequently provide updates on progress

By frequently sharing updates on the progress towards achieving the company’s goals, an inspirational leader has the opportunity to keep the focus on what the company is trying to accomplish. It keeps the company’s employees in the game.

Great inspirational leaders have great communication skills. To those that have a fear of public speaking, you can conquer that fear by facing it head on, by receiving coaching and taking every opportunity to publicly speak. You will never regret that you developed this skill. Someday, you, like Churchill, Kennedy and Reagan, may be able to mobilize the English language and send it into battle.

Stan Silverman is founder and CEO of Silverman Leadership. He is a speaker, advisor and nationally syndicated writer on leadership, entrepreneurship and corporate governance. Silverman earned a Bachelor of Science degree in chemical engineering and an MBA degree from Drexel University. He is also an alumnus of the Advanced Management Program at the Harvard Business School. He can be reached at Stan@SilvermanLeadership.com. Follow Silverman on LinkedIn here and on Twitter, @StanSilverman.

Mitigating Business Risks and Dealing with Failure

February 19, 2019

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on February 19, 2019

For those of us who have a lifetime of business and leadership experiences, it is an honor to be invited to share those experiences with the future generation of leaders. At the invitation of Dr. Barrie Litzky, associate professor at the Charles D. Close School of Entrepreneurship of Drexel University, I recently spoke to two of her undergraduate entrepreneurship classes, titled Ready, Set, Fail.

Quoting from the Close School course catalogue description of Ready, Set, Fail: “There are many students who say they want to be an entrepreneur, but they are often not ready for the risk that comes with starting and growing a business. Taking risks requires a deep appreciation of failure.” This course is about how to deal with and recover from failure – something we all need to learn. Taking risks with occasional failure is a natural part of life.

Every entrepreneur needs to assess their propensity for taking risks and recovering from failure. If they are taught how to deal with risk by de-risking their decisions, they will have a higher propensity for taking risks.

So, how does one de-risk a decision? The following principles are valid whether one is an entrepreneur, works for a start-up or works for an established company.

How well do you know the market?

Does the market need the product or service you’re developing? If the product or service already exists in the marketplace, does the differentiation between what you are developing and what currently exists in the market provide sufficient incentive to get customers to switch? If the product or service is new and future customers or clients don’t yet know they need what you are developing, how will you convince them that they need it?

Have you performed market research on your new product? Conducted customer focus groups? Sold prototypes and gauged customer acceptance? You should always be asking: “Why will customers buy my product or service?”

Imagine what could go wrong, and how you would mitigate it

Andy Grove, the former chairman and CEO of chip maker Intel, once said, “Only the paranoid survive.” Every business leader thinks about what could go wrong and what the proper reaction might be. In the case of entrepreneurs, they may need to pivot quickly and take a different approach if they hit an impediment.

Can the introduction of a new product to the marketplace be phased in, so the capital and resources required are not invested at once but over time, allowing for adjustments in strategy as more is learned about product acceptance?

When will your business become financially viable?

What is your new product or service worth to those who will be purchasing it? Will that price cover your costs plus make a profit? Build a financial model with which you can determine if and when your new business will become profitable. This will serve as a guide as to how much capital you will need to raise and invest in your business. Your investors will require this information.

Understand the cost of failure

Can the new initiative be undertaken in such a way that failure won’t sink the ship? The higher the risk, the higher the importance of understanding the cost of failure and how failure can be mitigated.

Seek the opinion of others

It is a strength, not a weakness, to ask the opinion of others, even if one has complete authority to make a decision on an initiative. Many times, through discussion, an alternative path on how to proceed emerges, better than the one originally contemplated.

Do your employees have the skills to make your business a success?

Hiring staff is among the most important decisions an entrepreneur will make in their fledging business. Are the employees you hire the right people? If it turns out that they are not the right people, part company with them. The longer they stick around and are not replaced with other, more competent people, the more time and capital you will waste. People and capital are the most important assets of any startup or business initiative.

Walk away from a failed initiative sooner rather than later

It is difficult for an entrepreneur to walk away from their idea if it appears it will not be successful. When to walk away is a matter of personal judgment. Should you push ahead trying to make an idea successful, or cut your losses and move on to something new?

Learn from past experience

Every significant initiative should be reviewed after an appropriate period of time so that learnings can be applied to future initiatives. When I became the CEO of PQ Corporation, the board asked that my team and I review all acquisitions during the past two decades to determine what went right, what went wrong and what we would do differently when making future acquisitions. This was an arduous lengthy process, but very valuable. In the five years I was CEO, we made seven acquisitions, all accretive, which helped drive our strategic and financial performance.

Learn and apply the lessons from your past successes and failures. It will lower the risk of your future initiatives.

Albert Einstein once said, “If you have never failed, you have never tried anything new.” Winston Churchill said, “Success is not final, failure is not fatal. It is the courage to continue that counts.” Both quotes describe the traits of all successful people, especially entrepreneurs.

Failure happens. It is not the end of the world. Learn to mitigate risks. Fred DeVito, author of “Barre Fitness,” once wrote, “If it doesn’t challenge you, it doesn’t change you.” Get outside of your comfort zone. You never know where the future will take you.

What to Focus on as a Newly-Appointed CEO

February 12, 2019

by Stan Silverman Articles

Article originally published in the American City Business Journals on February 12, 2019

In August 2016, I wrote an article about what new CEO’s should focus on in their first 100 days on the job. Based on my subsequent conversations with new CEOs, this is an update of that article.

You were just appointed CEO at a new company. The press announcements have been singing your praises, outlining your previous positions, expertise and track record of results.

The employees at your new company are wondering about your leadership style, your tone at the top and what changes you might make to the company’s culture and strategy, as well as possible changes to the senior leadership team reporting to you. Your board of directors will be wondering the same thing. What you say and do will be watched intently by everyone within the organization. Expectations that you will move the company forward will be very high.

As the new CEO, what should you focus on during your first 100 days? The knowledge gained during this learning process will help you formulate changes to the culture, the senior leadership team, as well as both the operational and strategic initiatives of the company.

Listen, ask questions and form impressions

Get to know the company, your board members and your direct reports. Talk with your board members and the individuals reporting to you, as well as those individuals reporting to them.

Learn about the norms and practices established by the former CEO

Understand the tone at the top and organizational culture under the previous CEO. Did the culture permit employees to practice common sense and good critical judgment, and when necessary violate the rules when doing so was in the best interest of the company? Were employees who did so terminated or celebrated? How much leeway were employees given to do what’s right versus follow existing policies and procedures?

What is the state of the company’s strategic plan?

Talk to your staff to understand the company’s current market situation. Is the strategic plan current, and are the various areas within the company pursuing strategies to achieve this plan?

Has a SWOT analysis (strengths, weaknesses, opportunities and threats) been performed, and do the strategic and operational plans build on the company’s strengths, minimize the impact of its weaknesses, exploit its opportunities and defend against its threats?

When you are sufficiently knowledgeable about the business, you will need to discuss the changes you want to make to the company’s strategic plan with the board. It is critical that as CEO, you and your team “own” the strategic plan, because you and they will be held responsible for executing it.

What is the competitive position of the company?

Vis-a-vis the competition, what is the competitive position of the company’s various businesses? How active is the competition in attacking the company’s markets with new product offerings or aggressive product pricing?

Determine if members of the senior leadership team know why their customers buy from the company, and why other customers buy from the competition. This knowledge should be known throughout the organization, so every employee, even those who do not directly touch the customer, can perform their jobs in a way to strengthen the company’s competitive advantage and deliver a great customer experience.

What is the cost position of the company versus its competitors? How competitive is the company’s business processes and information technology?

Ensure all employees are committed to the process of continuous improvement. The company should be on a journey to be the best in the world at what it does. Learn if all employees and board members buy into and share ownership of this ethos.

What is the company’s financial position?

How strong is the profitability and cash flow of the company and how much debt is on the company’s balance sheet? How capital intensive is the company and what major capital projects are on the horizon? Is the cash flow and balance sheet sufficiently strong to fund these projects and market growth?

Are you comfortable with your signature authority for capital projects beyond which you will need to take a project to the board for approval? Ensure you are comfortable with the signature authority of your direct reports, beyond which they need to get your approval.

Learn about the senior leaders who report to you

Understand the leadership styles, tone and culture of the senior managers reporting to you. Do they listen to their direct reports and do they surround themselves with people who will point out the brutal facts of reality? Can they execute and deliver results? Do they inspire their employees?

Do they micro-manage their direct reports, or do they empower them to make decisions, so they have a feeling of ownership in what they do? Are employees allowed to take risks, and do they know how to de-risk their decisions? Do some of your direct reports need to be changed?

Develop a good relationship with your board and stakeholders

Understand how the board operates, and their expectations of you. What level of information detail do they require to oversee the company? How much experience does each have as a board member? Do they tend to drift beyond oversight and governance and get into operational issues, which is the responsibility of the CEO?

You should also spend time focused externally, speaking with major stockholders and customers, and understand their expectations. What would they like to see that’s different from the previous CEO?

In my conversations with current and former CEOs, they all commented that trust among the leadership team is paramount to the success of their organizations. The foundation of trust is honesty, ethics and integrity. What is the level of trust among members of your senior leadership team?

Focusing on the areas above will ensure that you have an effective start as CEO at your new company.

Stan Silverman is founder and CEO of Silverman Leadership. He is a speaker, advisor and nationally-syndicated writer on leadership, entrepreneurship and corporate governance. Silverman earned a Bachelor of Science degree in chemical engineering and an MBA degree from Drexel University. He is also an alumnus of the Advanced Management Program at the Harvard Business School. He can be reached at Stan@SilvermanLeadership.com.

We Should All Practice the Human Side of Leadership

February 5, 2019

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on February 4, 2019

I recently had the privilege of speaking about the human side of leadership at a fireside chat event sponsored by the Union League of Philadelphia. My fireside chat partner was Karin Copeland, CEO of Create X Change and former executive director of the Arts and Business Council of Philadelphia.

I described the human side of leadership as a set of beliefs and practices that bring out the best in leaders and their employees, a company’s most important asset. These beliefs and practices help the company achieve a competitive advantage over the long term.

Where do these beliefs and practices come from? Some are discovered through the practice of the art of leadership. Others are intuitive and instinctive.

So, how does one practice the human side of leadership?

Set the right tone at the top and nurture the right culture

Tone at the top is set by the CEO and the senior leadership team, and reflects the ethical climate of the organization, while culture reflects how employees within the organization deal with each other, customers and other stakeholders. As the leader of your business, ensure that you set the right tone and culture. They become the behavioral norms of your employees.

Both tone and culture determine whether employees will trust their leaders and their fellow employees. Trust is built on honesty, ethics and integrity. Without trust, you can’t build a high-performance team. Without trust, you suffer high employee turnover and lose the talent you need to achieve success.

What are the elements of tone and culture?

Treat all employees with respect.
Act ethically and with integrity in all that you do.
Never lie. It undermines trust with everyone you deal with.
Understand that you are measured not just on financial results, but also on customer experience and company reputation.
Don’t micromanage – set expectations, empower and hold direct reports accountable for results.
Set goals with your direct reports’ participation so they have ownership in them and in what they do at the company.
Don’t permit a tyrant to abuse the people reporting to them.
Protect whistleblowers and fire those who try to retaliate against them.
Adopt employee-friendly policies.
Listen to the people in your organization. They can teach you the best lessons.

Recognize that emotional intelligence is a key leadership trait

In a 2004 Harvard Business Review article, “Leading by feel,” University of New Hampshire psychologist John D. Mayer wrote, “Emotional intelligence is the ability to accurately perceive your own and others’ emotions; to understand the signals that emotions send about relationships; and to manage your own and others’ emotions.”

Based on my experience interacting with others, the following six EQ behavioral rues will contribute to your leadership effectiveness.

Recognize how other people perceive you.
Don’t communicate with others in a way that puts them on the defensive.
When a direct report shares an idea or proposes a new initiative, listen.
Take the blame if it’s your fault. Give credit where credit is due.
Avoid being an imperial leader. Don’t threaten others to achieve your goals.
Don’t self-aggrandize.

Communicate empathy

One of the most important skills of any leader is to know when and how to communicate empathy. Former Michigan State University Interim President John Engler and former MSU president Lou Anna Simon, who he replaced, both demonstrated that they lack empathy. They made insensitive remarks about the sexual abuse victims of Dr. Lawrence G. Nassar, physician to athletes at MSU and national team doctor for USA Gymnastics, who was sentenced up to 175 years in prison for sexually abusing young women.

A Jan. 11 Detroit News article quotes Engler, speaking about those sexual abuse victims who were not personally in the news, as saying, “In some ways they have been able to deal with this better than the ones who’ve been in the spotlight who are still enjoying that moment at times, you know, the awards and recognition.”

“Enjoying that moment … the awards and recognition?” Did Engler not understand how inappropriate and insensitive that sounds?

On Jan. 16, Engler resigned his position as interim president of MSU effective Jan. 23, after losing the support of the MSU board. In his resignation letter, Engler did not acknowledge the comments that led to his loss of MSU trustee support. He blamed politics as the reason.

In the face of growing criticism from many of the students, faculty and staff at Michigan State on how Simon handled the accusations against Nassar, and after losing the confidence of a number of MSU board members, Simon resigned her position as long-time president of the university on Jan. 24, 2018.

In her resignation letter, Simon wrote, “As tragedies are politicized, blame is inevitable. As president, it is only natural that I am the focus of this anger.”

“Politicized,” Dr. Simon? I am not sure how the abuse of so many young women can be politicized.

It is evident that neither Engler nor Simon knew how to communicate empathy.

Allow employees to violate the rules when it is in the best interest of the company to do so

I learned this as a sales manager for my company early in my career. I ordered a recall of contaminated product without the authority to do so. My boss was traveling and unreachable. Due to the rising cost each day the recall was delayed, I ordered the recall.

I was celebrated, not terminated for my decision. I was taught how to make employees feel trusted, empowered and valued by their boss. Hire people with common sense and good critical judgment so they know when to violate the rules.

What do the above four leadership practices have in common? To me, they help define the human side of leadership. As a leader, whenever I have a doubt about how to deal with a situation, it’s hard to go wrong if I follow the simple adage, “Lead like you like to be led.” Good advice for all leaders.

Don’t Forge Ahead If Meeting an Important Commitment Could Have Adverse Consequences

January 29, 2019

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on January 29, 2019

Monday, Jan. 28, marked the 33rd anniversary of the space shuttle Challenger disaster. On that date in 1986, the Challenger exploded 73 seconds after liftoff due to a leak in one of the O-rings of the solid rocket booster, resulting in the death of all seven crew members and the loss of the shuttle.

I have written about two valuable lessons taught by the Challenger tragedy – the importance for leaders to listen to their experts, and for leaders to face the brutal facts of reality. Now I want to share another lesson of the Challenger tragedy – don’t forge ahead to meet an important commitment when doing so could have adverse consequences. In the case of the Challenger, disastrous consequences.

NASA had made unrealistic launch frequency commitments to Congress in order to secure increased funding for the space program. On that day in January 1986, rather than face the brutal facts of reality – cold weather conditions – NASA ignored its experts and launched Challenger.

The engineers at Morton Thiokol, the contractor responsible for the design of the solid rocket boosters, were concerned about the effect the cold would have on the solid rocket booster O-rings. The O-rings were designed by these engineers to operate at an ambient temperature of no less than 40 degrees Fahrenheit.

On the day of the launch, the ambient temperature was 30 degrees. Worried about the brittleness of the O-rings, Thiokol told NASA that the launch needed to be postponed.

NASA ignored the risk of an O-ring failure and objected to the recommendation to delay the launch. The launch had already been delayed a number of times for various reasons. One NASA manager is quoted as saying, “I am appalled by your recommendation.” Another NASA manager said, “My God, Thiokol, when do you want me to launch – next April?”

Thiokol management, facing pressure from NASA, eventually acquiesced and agreed that the launch could proceed. The rest is history: an O-ring failure caused the loss of Challenger and its crew.

What drives leaders to meet their commitments, a natural characteristic of all leaders, even though doing so may mean experiencing adverse consequences? They want to maintain their credibility with those who have power over them, to whom they have made commitments, regardless of the inadvisability of meeting those commitments.

In the case of NASA and the decision to launch the Challenger, the space agency wanted to meet its commitment to Congress who provided funding for the nation’s space program. For CEOs, it’s their board of directors, who can terminate them for not meeting their commitments, or their shareholders, who if dissatisfied with the financial performance of the company, can drive down the company’s stock price. In the case of politicians, it’s the voters who can toss them out of office at the next election for not meeting the commitments made while campaigning for office.

A case in point is President Donald Trump’s surprise statement on Dec. 19, announcing the immediate withdrawal of U.S. troops from Syria, fulfilling a campaign promise to do so.

All three lessons taught by the Challenger tragedy were ignored by Trump: the importance for leaders to listen to their experts; for leaders to face the brutal facts of reality; and to never try to fulfill a commitment when there is high risk of an adverse outcome.

A Dec. 24 article in Newsweek by Tom O’Connor is headlined, “Donald Trump is keeping promise to withdraw from Syria so he can win the 2020 election, experts say.” Fulfilling that campaign promise is more important to Trump than meeting obligations to our allies and partners in the region.

James Mattis, a knowledgeable and highly respected retired Marine Corps general, resigned from his position as Secretary of Defense on the day Trump made the troop withdrawal announcement. He did so because he disagreed with Trump’s withdrawal decision, and other policy decisions made by Trump.

An article from The Washington Post on Dec. 19 by Karen DeYoung is headlined, “Trump’s decision to withdraw U.S. troops from Syria startles aides and allies.” Trump did not ask for the input of his military advisors, nor pre-advise our allies of his decision.

At a press conference on Dec. 20, Senator Lindsey Graham (R-SC), a supporter of most all of Trump’s initiatives, said, “There are a lot of broken hearts of Americans, who have looked our allies in the eyes [and] who have said, we are going to stick with you.” Their statements to our allies were undermined by Trump’s announcement to withdraw.

Graham continued, “As to the decision by the president, I don’t know where it came from, but it needs to be reconsidered. Ambassador [James] Jeffrey, our special envoy to Syria, just two days ago announced a commitment to stay until we got this right. I don’t know how this decision was made, it came out of left field, it rattled the world.” Trump’s surprise announcement undermined Jeffery’s credibility with our allies and partners in the Middle East.

Especially vulnerable are the Kurds, who have fought valiantly to further U.S. interests. Without a U.S. military presence in the region, they risk attack from Turkey. Trump threatened to devastate the economy of Turkey if they attacked the Kurds. You don’t say this to an ally.

Trump has now agreed to withdraw U.S. troops over a longer period of time. Leaders who need to walk back their intended actions undermine whatever trust and confidence their supporters have in them.

Business and political leaders, remember these three lessons: listen to your experts before making a decision; face the brutal facts of reality; and never fulfill a commitment when there’s a high risk of an adverse outcome. It’s a strength to admit to your board or your political base that the current situation has caused you to change your mind and not fulfill a commitment that no longer makes sense in the current environment. It is a weakness to proceed as originally planned and possibly suffer a disastrous consequence.

Stan Silverman is founder and CEO of Silverman Leadership, and is the former CEO of PQ Corporation. He is a speaker, advisor and nationally syndicated writer on leadership, entrepreneurship and corporate governance. Silverman earned a Bachelor of Science degree in chemical engineering and an MBA degree from Drexel University. He is also an alumnus of the Advanced Management Program at the Harvard Business School. He can be reached at Stan@SilvermanLeadership.com. Follow Silverman on LinkedIn here and on Twitter, @StanSilverman.

Lesson from Michigan State University: Empathy Is a Key Leadership Trait

January 22, 2019

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on January 22, 2019

One of the most important skills of any leader is to know when and how to communicate empathy. The third senior leader at Michigan State University during the past 12 months, Interim President John Engler, has just demonstrated that he lacks this skill in remarks he made about the sexual abuse victims of Dr. Lawrence G. Nassar.

On Jan. 24, 2018, Nassar, physician to athletes at MSU and national team doctor for USA Gymnastics, was sentenced to 40 to 175 years in prison (concurrent state and federal sentences) for sexually abusing young women. Around 150 women gave impact statements in court prior to his sentencing. It has been reported that there are at least 265 Nassar victims.

“Enjoying that moment … the awards and recognition?” Did Engler not understand how inappropriate and insensitive that sounds?

On Jan. 12, the chair of the MSU Board of Trustees, Dianne Byrum, commented in a Twitter message, “[Engler’s] remarks were ill advised and not helpful to the healing process, survivors, or the university.”

On Jan. 16, Engler resigned his position as interim president of MSU effective Jan. 23, after learning he lost the support of five of the eight MSU trustees and would be terminated if he didn’t resign. In his resignation statement, however, Engler did not acknowledge the comments that led his loss of MSU trustee support. He did not express regret that his comments were hurtful to the athletes who were abused by Nassar. He blamed politics as the reason for his loss of trustee support.

Understanding when and how to express empathy was an issue with the previous president of MSU, Dr. Lou Anna Simon, who Engler replaced, and the vice chairman of the MSU board, Joel Ferguson. I wrote an article about Simon and Ferguson in February 2018 headlined, “Viewpoint: Michigan State tone deaf to abuse by Nassar.”

In that article, I wrote that in the face of growing criticism from many of the students, faculty and staff at Michigan State on how Simon handled the accusations against Nassar, and after losing the confidence of a number of MSU board members, Simon resigned her position as long-time president of the university on Jan. 24, 2018.

In her resignation letter, Simon wrote, “To the survivors, I can never say enough that I am so sorry that a trusted, renowned physician was really such an evil, evil person who inflicted such harm under the guise of medical treatment.”

Simon added later, “As tragedies are politicized, blame is inevitable. As president, it is only natural that I am the focus of this anger.”

“Politicized,” Dr. Simon? I am not sure how the abuse of so many young women can be politicized.

Similarly, MSU Vice Chairman Joel Ferguson was also insensitive and tone deaf to Nassar’s victims. During an interview on a Detroit radio show before Simon’s resignation, Ferguson commented, “There are so many more things going on at the university than just this Nassar thing.”

“Just this Nassar thing,” Mr. Ferguson? As someone who holds the same position as Ferguson at another university, I believe his remarks and attitude were completely inappropriate.

After being widely criticized for his insensitive comments, a spokesperson for Ferguson released a statement that in part said, “Mr. Ferguson deeply regrets his comment and apologizes to those he offended.” Amid calls for his resignation from the MSU board, he chose not to do so, and remains on the MSU board.

An important responsibility of an effective leader is to set the right tone at the top and nurture the right culture at their organization. What a leader says or doesn’t say in part sets the tone and culture. Your employees and other stakeholders listen to you. Be sensitive to what you communicate to them.

Your employees may make statements or act in a way consistent with your attitude or what you say. Show compassion to those that have been wronged or hurt. That’s what effective leaders do.

Get out of Your Comfort Zone & Push Through Your Self-Perceived Limitations

January 15, 2019

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on January 15, 2019

People often share with me the real and perceived limitations they face in pursuing their goals. As we enter 2019, I would like to share with you this look back at an article I wrote in December 2015 headlined “Advice for the New Year: Push through your self-perceived limitations.”

Why do people experience various degrees of success over the course of their careers? During my career, I have observed many successful people and those wanting to achieve success. There are those who succumb to their self-perceived limitations, and those who find a way to push through them.

The proverb, “Whether you think you can or can’t, you’re right,” is ascribed to Henry Ford. Your attitude and your ability to push through self-perceived limitations play key roles in how successful you will be.

A friend at my gym drove this home for me a number of years ago. I had been doing assisted pull-ups on an exercise machine that uses counterweights because I believed I did not have sufficient upper-body strength to do a pull-up without them. My friend came up to me and said, “I know you can do pull-ups unassisted.”

I told her that I hadn’t done unassisted pull-ups since high school and I couldn’t do them now. She egged me on, challenging me to do just one. By now, a crowd was gathering, and I felt huge peer pressure to try to do one pull-up. I walked over to the machine without counterweights and, with my friends watching, nervously jumped up six inches and grabbed the pull-up bar. To my surprise, I was able to do two!

I never used the counterweight machine again. Over the subsequent three months, I pushed hard and worked my way up to three sets of 10 unassisted pull-ups. I learned a valuable lesson from my friend: You are only limited by your own self-perceived limitations. Thank you, Patti Morris!

Sometimes it takes a friend, colleague, coach or mentor to inspire you to the next level. When you move to that next level, you never look back – you only look forward. As leaders, our job is to inspire others around us – to help them move to that next level.

To me, one such individual is Seth Godin, the author of “The Icarus Deception,” who writes about Icarus, the character in Greek mythology who flies too high and too close to the sun. His wings melt off and he crashes into the sea.

Godin writes: “It is far more dangerous to fly too low than too high, even though it might feel safer to fly low. You settle for low expectations and small dreams, and guarantee yourself less than what you are capable of. By flying too low, you also shortchange not only yourself, but also those who depend on you, or might benefit from your work.”

People fly too low due to fear and self-perceived limitations. If you fly too low, you are not preparing yourself for a time that may come when your job or profession becomes obsolete and you must re-launch your career. So, during your career, be sure you don’t fly too low. Take risks and fly high, and if you crash, you will pick yourself up and fly again.

Get out of your comfort zone and take on new challenges. Albert Einstein once said, “Anyone who has never made a mistake has never tried anything new.” You differentiate yourself among your peers by trying new things, sometimes failing, but moving forward. This trait will help you land your next job. Employers, hire those who embrace change, rather than those who don’t.

The type of company at which you want to work should value employees who are not afraid to innovate, embrace change and, yes, occasionally make mistakes and learn from them.

Your attitude, which is apparent to everyone you interface with, plays a significant role in your success. Be a person who sees a world of abundance and possibilities, not one who sees a world of limitations and scarcity. Push through self-perceived limitations. You never know what the future holds or where it will take you.

How Continuous Improvement Can Help You Achieve Preferred Provider Status

January 8, 2019

by Stan Silverman Articles

Article originally published in the American City Business Journals on January 8, 2019

One of the most important objectives that a company can adopt is to achieve preferred provider status for products and services to its market — the company that customers and clients preferentially go to first before going to the competition.

This is the Holy Grail of any company.

In August 2014, I wrote an article headlined, “A culture of continuous improvement is no management fad … In fact, it could be the Holy Grail.” However, I no longer consider it to be the Holy Grail. It’s an enabler — it helps companies to be a lower-cost provider of products or services, which builds competitive advantage and enables a company to achieve preferred-provider status —the Holy Grail of any firm.

Given the importance of continuous improvement to building competitive advantage, I would like to offer an update to the August 2014 article on continuous improvement.

Over the years, many corporate initiatives have been proposed by consultants such as Six Sigma, Baldrige Quality Award and Kaizen. Many of these initiatives are not sustainable without significant time and effort by management. Today, some are rarely practiced.

At PQ Corporation, we found that the one initiative that generated results and was sustainable over time was the culture of continuous quality improvement, or CQI.

How was CQI different than other improvement initiatives? It was the way in which we implemented it.

We had employees get directly involved in the effort. Instinctively, most employees realize that continuous improvement is needed to grow the company and build competitive advantage. To not continually improve means that you fall behind. No other initiative has this innate imperative.

Even though CQI at PQ was led by the CEO and other senior leaders, it was driven by the employees at every level within the company. The senior leadership of the company was charged with creating an environment where employees developed a sense of ownership in that part of the business in which they work.

This cultural change put power and responsibility into the hands of employees, not managers, to initiate and drive improvement projects. Each of the production unit teams within our manufacturing plants was given $50,000 to spend on projects chosen by the team to improve their manufacturing processes.

Creation of a CQI culture required training of all managers to be coaches and counselors to their staff, empowering them to develop and implement their own improvement ideas. Training was needed to help employees analyze data to determine the root cause of issues, so proper solutions could be identified.

By adopting CQI, my company saved millions of dollars from ideas generated and implemented by our employees.

By relying on our employees to identify and execute these projects, it brought out the creativity in our people, encouraged them to be more proactive, and showed them in a tangible way that they mattered to the success of the company. This helped us be more competitive, and provided funds to reinvest in and grow our business.

There is nothing like having employees throughout the organization, hourly and non-hourly alike, develop and execute their improvement projects so they could develop a sense of ownership in what they do.

So, if you are looking for a way to build competitive advantage to help achieve the Holy Grail — becoming the preferred provider of products or services to the market — adopt a culture of continuous improvement. Companies that do not continually improve will be left behind. Those that do will win the competitive race in the long run.

A Challenge Culture Is an Imperative for All Organizations

December 18, 2018

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on December 18, 2018

How many times have you sat in a meeting in which not one of the attendees challenged the prevailing opinion about the issue being discussed?

What is it about an organizational culture that prevents at least one lone-wolf independent thinker from expressing a counter opinion? Does the leader voice a negative reaction to a counter-opinion, rather than encourage the attendees to speak their minds?

Former chairman and CEO of Dunkin Brands Group Nigel Travis was in Philadelphia recently to speak about the importance of establishing a challenge culture within organizations in which input from employees is welcomed. He was interviewed by thought leader and event host Karin Copeland about his recent book, “The Challenge Culture,” in which Travis shares the importance of leaders nurturing this type of culture.

Copeland asked Travis, “What is a challenge culture, and why is it so important in every organization?” Travis responded, “It’s a culture in which direct reports can challenge their bosses … and colleagues can challenge each other.”

Travis said, “A challenge culture is … [one in which] people have a say, where people understand what’s going on. The results are great business solutions and total buy-in, because people feel involved [and respected].”

A challenge culture is needed to ensure that the brutal facts of reality are recognized to arrive at the best course of action, and to create a sense of ownership in that course of action by those involved in its execution.

Of course, that culture needs to focus on attacking business issues and not people, so that challenging others doesn’t destroy working relationships. Respecting civil discourse is a key determinant for success in a challenge culture.

Working in a challenge culture requires individuals with the self-confidence to hear criticism of their ideas and not take it personally, and to have the ability to challenge others.

Leaders must listen to their experts, and not dismiss their input. Not doing so is at their peril. In August 2015, I wrote an article headlined, “How an independent thinker unearths brutal facts of reality,” in which I described how NASA ignored the Thiokol engineers who warned against the launch of the space shuttle Challenger due to cold weather conditions that could result in the failure of the shuttle’s solid rocket booster O-rings.

Challenger was launched on Jan. 28, 1986, and the O-rings failed 73 seconds after launch, resulting in the tragic loss of the lives of five astronauts and the shuttle.

That article also described the culture within the Rogers Commission (named for its chairman Willian P. Rogers), established to investigate the reasons for the Challenger disaster. The following contains excerpts of that August 2015 article.

The Commission found that NASA, concerned about their inability to meet an unrealistic launch schedule that might jeopardize their Congressional funding, did not face the brutal facts of their reality – launching in cold weather conditions would expose the Challenger to an unacceptably high level of O-ring failure risk.

Physicist Richard Feynman was the lone-wolf on the Rogers Commission. Feynman clearly saw that two issues within NASA were lack of communication and an understanding of risk. Through his own work independent of the Commission, Feynman learned that NASA management felt that the likelihood of shuttle failure was one in 100,000, compared with NASA engineers, who felt that the likelihood of failure was one in 100.

Feynman was the lone-wolf on the Commission, wanting to probe an organizational culture in which there was such a large disconnect between management and their technical experts.

Feynman was at odds with Rogers on many issues during the investigation, and when Feynman learned that the final Commission report would not focus on the issues he felt were key to the loss of the shuttle, he decided to write a minority report. If it wasn’t for Feynman, these issues within NASA might not have been identified and addressed, perhaps leading to future shuttle disasters.

So, how do organizations ensure that the brutal facts of their reality get addressed? It takes the leadership of the CEO to nurture an environment that values a challenge culture as advocated by Nigel Travis.

In the words of renowned Brazilian novelist, Paulo Coelho, “If you want to be successful, you must respect one rule: Never lie to yourself.” Leaders, remember this when one of the independent thinkers on your staff reminds you to face the brutal facts of your reality.

A Teachable Moment from the Political Divide

December 11, 2018

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on December 11, 2018

In the days following the Nov. 27 publication of my article headlined “America’s traditional values are as important as economic interests,” I experienced a teachable moment – when discussing different viewpoints, we need to listen to the other person’s perspective and understand their reasoning for the opinions they hold which might narrow the gap between our views.

I criticized President Donald Trump for discounting the CIA’s conclusion that Crown Prince Mohammed binSalam of Saudi Arabia was responsible for the murder of U.S. resident and Washington Post columnist Jamal Khashoggi, and for not holding bin Salam accountable. Trump said, “Do people really want me to give up hundreds of thousands of jobs?” in reference to the business the Saudis do with the U.S.

I asked, “What about reaffirming America’s commitment to human rights values, a question asked by both Democrat and Republican lawmakers?”

A reader, Dennis Hathaway, of San Antonio, Texas, wrote an email to me and disagreed with what I wrote. Through a number of email exchanges, we closed the gap in our views – a lesson in civility that we can all learn from.

The following are excerpts from our email thread:

Hathaway:

Thanks for the article Stan. I have to disagree with you though. I doubt any other president would have done much different. Remember the 9/11 hijackers all came thru Saudi Arabia and nothing was done then to sanction Saudi.

Other presidents may have said they were going to do something, but it would have been PR talk. Trump, I believe, is only speaking reality here. May not like it or agree with it, but it is what it is.

I’ve about had it with the “it’s not who we are” statements. It’s a good line that is used by the Democrats and liberals to criticize the conservative side of American politics. We as a country, are who we are.

Silverman:

Thanks Dennis, for your comments on my article yesterday.

Yes, you’re right. Saudi Arabia was not sanctioned after 9/11. I assume no sanctions were put in place because there was no evidence that the government of Saudi Arabia was involved in the 9/11 attack, unlike the CIA conclusion that the Saudi government was involved in Khashoggi’s murder.

You write, “I’ve about had it with the ‘it’s not who we are’ statements. It’s a good line that is used by the Democrats and liberals to criticize the conservative side of American politics.”

Dennis, for the record, I am a Republican and have been my entire life. I am not a Democrat or a liberal and never will be. What I am is a patriot, who strongly believes in country before party.

And, it is who we are as a nation. Senate Majority Leader Mitch McConnell (R-Ky.) has taken the same position as I have, as reported in a news article headlined, “McConnell: Saudi actions ‘abhorrent’ and warrant ‘response.’”

Quoting McConnell, “What obviously happened – is basically certified by the CIA – is completely abhorrent to everything the United States holds dear and stands for in the world. Some kind of response to that certainly would be in order and we’re discussing what the appropriate response should be.”

I have many fellow Republican friends and colleagues who do not support Trump and many of his policies. They are insulted that the far right calls them liberals. They are anything but!

Hathaway:

Thanks Stan. I too believe in country before party. Don’t know that I can agree with your statement of not knowing if the Saudi government was involved in 9/11. I just firmly believe we would not have taken action against them because we need them for various military staging areas, and at that time, for oil to carry out our actions against Al-Qaeda.

I will retract my liberal statement and just have it apply to Democrats. Because I truly believe the Democratic Party has shown itself to not have any ideas except to attack Trump.

I don’t like all that Trump does, but one thing you have to give him is that he has pushed the policies he said he would if he got elected. More than we can say for most of our elected leaders. We have had such terrible candidates from both parties lately. Bob Dole, Hillary, McCain and Gore. Is this the best we can do?

Bill Clinton started the politics of personal destruction. Now it’s pervasive in the political arena from both sides. I’m afraid that has led us to a point where we will see Trump types on both sides, from now on.

Silverman:

Hi Dennis. Except for our differing views on whether the Saudi government was involved in 9/11 and some of the individuals on your list of “terrible candidates,” I basically agree with the points in your latest email. If the Democrats run an Elizabeth Warren / Bernie Sanders type candidate, they are foolish. The country will fully reject that type of candidate and Trump will win a second term.

I want to share with you an article that I write each year on the anniversary of 9/11. Glad we are having this exchange of ideas and views.

Hathaway:

Very well written article, Stan. I was on a flight from Baltimore to Mississippi during that event. One of my best friends was a NYC fire fighter with Rescue 3. He was off duty headed home and turned around to come help his brothers. He was lost when the towers collapsed.

My wife was across the river from the Pentagon and right across the street from the State Department. She spent much of the day coordinating Navy medical response.

My son was and still is in the Army. He was in the first raid with the Army Rangers into Afghanistan. Thankfully, he has managed to complete 55 months of duty in Iraq and Afghanistan with just a few scars.

I think you are correct, that’s who we really are as Americans. We just can’t seem to hold that reality once things “settle down” again.

Silverman:

You and your family have been touched in so many ways by 9/11, Dennis. I am so sorry for the loss of your courageous friend. A hero in every sense of the word. Glad your son remains safe (with a few scars) during his time in the military. We are all in debt to him for his service.

Hathaway:

I have no problem with discussing differing views, with anyone who can provide a different set of facts, or another way of looking at the problem. You get better solutions to problems that way.

I think our email conversation narrowed the gap in our views because we listened to each other and acknowledged each other’s points even when we did not necessarily agree with them. We also started to dialogue on a personal level.

I shared the above email thread with friend and colleague Ray De Hont, who generally expresses the political views of Hathaway. De Hont wrote the following to me:

“I truly believe what you and Dennis have done is what is missing in our society today. To close the divide in our country, we need to allow a friendly exchange of viewpoints without name calling, severe criticism, or turning people off all together.”

“Love of Country Leads” is the motto of the Union League of Philadelphia, where I am a member. The League was established in 1862 as a patriotic club to support President Abraham Lincoln and the Union during the Civil War. This motto applies to both sides of the political divide in our country.

We are all patriots. We need to talk to each other and not at each other on issues impacting our nation.

Advice from Shark Tank’s Kevin O’Leary: How to Drive Earnings Growth

December 4, 2018

by Stan Silverman Articles

Article originally published in the American City Business Journals on December 4, 2018

One of the most important decisions of any leader is to set annual financial goals for their organization.

Should they set realistic goals, or tough stretch goals with a lower probability of achievement?

At the recent Disruptor 50 conference in Philadelphia, Shark Tank star Kevin O’Leary discussed the factors that influenced the return of capital of the 37 companies within in his venture portfolio. O’Leary said, “A study that showed … 90 percent of the [cash] returns came from companies run by women.” Why?

“Companies run by men hit their quarterly sales targets 65 percent of the time. … Women-led companies hit their targets 95 percent of the time. … If you are on a winning team in any sport, … you have a winning culture. Winning cultures have different metrics than just financial reward. Being part of a winning team is powerful. These [women-led] teams are constantly hitting their targets.”

O’Leary talks about his views in a March 2018 CNBC article headlined, “Shark Tank star Kevin O’Leary: Women-run businesses make me the most money — here’s why.”

In this article, O’Leary says, “If employees aren’t meeting their goals, that frustration can lead to turnover, which is particularly costly for small operations. Women are better at avoiding this pitfall.

“When you meet your goals 95 percent of the time, you change the culture of your business. People feel they’re working in a winning organization,” O’Leary says. “That’s why women are doing better in business — they keep their people. The staff are sticky. They want to work there because they’re hitting their goals. … You don’t have to reach for the stars, you want to win 95 percent of the time. That’s the secret sauce.”

In January 2015, I wrote an article on this subject headlined, “Setting credible and realistic goals can drive your financial performance.”

As a mid-level leader at my company, I lived through many years of CEOs setting what nearly every direct report felt was an unrealistically high annual corporate earnings goal that lacked strategies for achievement. As we started to lag behind the goal, costs were cut in a losing effort to try to close the performance gap between the actual result and the goal.

This was a debilitating exercise that took its toll on morale. Who were we kidding?

One of the keys to setting a goal is to ensure that upside potentials are properly balanced by down-side risks. We found that people are optimistic and often overstate upside potentials and understate downside risks. This contributes to missing the goal.

When I was named CEO of the company, we changed the paradigm of setting unrealistic goals. We set business unit and corporate earnings goals with a more realistic chance of achieving them. We were much more realistic in balancing the upside potential with the downside risk of possible adverse market events. The objective for everyone was not only to achieve our business unit and corporate earnings goals, but to blow through them to the greatest degree possible and have fun doing it.

The morale changed significantly within the company. Instead of a debilitating atmosphere in which we lagged our earnings goal during the year, employees took pleasure in tracking above goal each month and quarter.

I didn’t use O’Leary’s phrases “winning team” and “winning culture” to describe what we created, but thinking back, those are the phrases to describe the change in the organization at that time.

Our employee incentive program was not driven by achieving the earnings goal, but against achieving earnings growth as a calculated percentage above the three previous years’ earnings results, based upon what was appropriate for our industry. The higher the actual earnings achieved, the higher the bonuses and profit-sharing pool in which all employees participated.

With this approach, our earnings more than doubled from 1999 through 2004, a period that included 9/11 and the recession of 2002. This compared with flat earnings during the previous three years. We out-performed our peer group of 17 companies during this five-year period, and moved solidly into first quartile performance.

As the leader of your organization, consider how you set the annual earnings goal for your company. The stockholders don’t even know what the earnings goal for the company is and don’t care – they only care about year-over-year earnings growth. Reward your people for maximizing year-over-year earnings growth in an upbeat culture, and reward them handsomely for doing so.

America’s Traditional Values Are as Important as Economic Interests

November 27, 2018

by Stan Silverman Articles

Article originally published in the Philadelphia Business Journal on November 27, 2018

President Donald Trump cannot be blind to America’s traditional values that go to the heart of who we are since our nation’s founding. He continues to question the CIA conclusion that Crown Prince Mohammed bin Salam of Saudi Arabia was responsible for the murder of U.S. resident and Washington Post columnist Jamal Khashoggi, and refuses to sanction Saudi Arabia.

Trump has stated he will not hold bin Salam accountable for the murder so as not to adversely impact the economic interests of the U.S.

“Do people really want me to give up hundreds of thousands of jobs?” Trump said, in reference to the business the Saudis do with the U.S. What about reaffirming America’s commitment to human rights values, a question being asked by both Democrat and Republican lawmakers?

Trump could have strongly reaffirmed American human rights values and then announced appropriate sanctions against Saudi Arabia for the murder of Khashoggi without jeopardizing our economic interests. That is what former presidents would have done. That is what most Americans expected him to do. He didn’t. Trump is tone deaf on this issue.

In a Nov. 16 Fox News article headlined, “CIA determines Khashoggi’s death was ordered by Saudi Crown Prince Mohammed bin Salman: report,” columnist Elizabeth Zwirz writes, “The agency’s conclusion came as a result of ‘an understanding of how Saudi Arabia works,’ rather than a ‘smoking gun,’ a U.S. official with knowledge of the situation told The Wall Street Journal.”

In a Fox News Sunday interview, Sen. Ben Sasse (R-Neb.), stated, “Sometimes you have to work with bad guys in the world. There is a coherent realist case to be made there. …[However,] MBS contributed to murdering somebody abroad and it’s not strength to mumble past that. Strength is telling the truth even when it’s hard.”

Seven weeks after Khashoggi’s murder, on November 20, the White House finally issued a press release headlined, “Statement from President Donald J. Trump on Standing with Saudi Arabia.” To his credit, Trump stated, “The crime against Jamal Khashoggi was a terrible one, and one that our country does not condone.” Inaction, however, speaks louder than words, and many people question Trump’s sincerity.

I have heard people comment that Trump is a former CEO and that’s what boards allow CEO’s to do – pursue the economic interests of their shareholders to the exclusion of non-economic interests and values. Well, not this former CEO, not my board and not numerous public and private company boards that I have served on!

Trump may have chosen to run his own private company as if the bottom line was his only interest. However, he is now the President of the United States, and cannot be blind to American human rights values.

In today’s world, not many CEOs and their boards have such a narrow view of their responsibilities to their stakeholders. Their responsibilities go beyond economic. That is what their employees expect of them. That is what their customers expect of them.

President Trump: CEOs and other leaders as well as the President of the United States, are held accountable to more than just economic, or bottom line results. They are also held accountable for doing the right thing.