Monday, June 8, 2009

Imagine business operating like a sports team

I am watching the NHL playoffs this year with interest, not because I am a fan of either team, but rather in an attempt to understand why sports teams operate so differently than many business teams. Regardless of the sport, there are some undeniable facts about those teams that make it to the finals, and ultimately the championship. It is important to first understand what it is not.

Best People

Having the best players (performers) does not assure any team of a championship. It certainly helps, but we don't have to look very far to find examples of poor performing teams with some of the best players, or the performance records of top players extinguished when they move to a mediocre team.

So much attention is given to the great players in sports (and in business) that the tendency is to believe that they are the key to success. I believe that the following attributes, in combination with great talent, under the guidance of a great coach (leader), create a championship team:

  • The team is intently focused on their goal
  • Each player knows his role, and executes it with excellence
  • Each team member puts forth an above average level of effort
  • Team members feed off of the energy of each other, and do not compete with each other

Many, businesses do not operate like a sports team, and fortunately, no sports team operates like a business. Look at my comparison between the sports team and the "traditional" business or organization. By "traditional", I mean the average mediocre business of today – many that are failing and a description of those that have failed.

Sports

Business

Coach is not in the limelight – largely behind the scenes. During the game, coaches role has only little effect on the outcome

Leader is often larger than life – seemingly the life of the organization – almost as if the company could not survive without. Team is brought up to depend on the micromanaging direction of the leader at all times

Every member of the team understands that their contribution is integral to the overall success of the team

Apathy often exists among team members. The importance of their contribution is not apparent to them, the team, or the leader.

It is obvious that great players require the help of their team members to become and stay great players – they work together

Top performers seem to get there on their own, with no recognition of the help of the team – tendency is to compete against their own team

Team is focused only on those metrics that support the goal of winning

Team's focus is often scattered among numerous goals and fringe metrics

What it looks like to "win" is clear

What it looks like to "win" is not always clear

I am trying to figure out why sports teams consistently maintain their focus on the goal – on the win, while business organizations tend to lose their way. Imagine the coach of an NHL hockey team in the dressing room addressing his players before the game; "Now team, we have to work on bringing our fan attendance up – I want each of you to focus on the crowd between whistles – make eye contact, smile and even wink at some of the ladies. We need to connect more effectively with the crowd during the game". How successful would a NASCAR team be if the crew chief was more concerned about the paint scheme on the car than the mechanical details?

Yet, I worked for an organization where making a facility pretty to impress the boss and monitoring the "metrics dashboard" was infinitely more important than serving the customer and meeting their needs. The shift of focus to revenues from vehicle financing (GMAC) by GM to bolster the profit line vs. making automobiles that people want is only one of a number of pitfalls that this organization fell in to.

This problem of "wandering focus" is not an issue with sports teams. Why is it so prevalent in business and almost every other organization? The consequences are certainly the same for both; sports teams do not win resulting in an eroding fan base and reduction of revenue; businesses lose market share and experience an eroding customer base and revenue.

My conclusion

The coach of a sports team can't fool the team, the owners, or the fan (the customer) – it is impossible. The rules of the game are simple and with only small minor exceptions, never change – putting the puck in the net will always constitute a goal in hockey, running a football into the end zone will always be a touchdown in football.

Conversely, business leaders have managed to overcomplicate business so effectively, that it is hard to know if you are winning or loosing. Changes in accounting practices, acquisitions, and market shifts or trends are often used as illusions to hide poor performance in core businesses. "Wandering focus" or the chasing of every alluring opportunity regardless of an organization's purpose and "reason for being" seems to have been in vogue over the past 20 years. It was almost as if a CEO was not a real CEO if he/she was not acquiring or diversifying. We see today that this waywardness is catching up with organizations, and the consequences are devastating.

Business leaders have fooled the team and the owners. However, they cannot fool the fan (the customer), and it is the customer that will always decide the fate of any organization. We would be wise to never forget this fact.

Now imagine the business that operates exactly like a sports team. I submit that there is a direct correlation between the success of any organization and the degree that its' operation matches that of a sports team.


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