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What is strategy?

Excerpts from What is Strategy?
Michael E Porter in Harvard Business Review

Strategy_viewsA company can outperform rivals only if it can establish a difference that it can preserve. It must deliver greater value to customers or create comparable value at a lower cost, or do both. The arithmetic of superior profitability then follows: delivering greater value allows a company to charge higher average unit prices; greater efficiency results in lower average unit costs.

  • Ultimately, all differences between companies in cost or price derive from the hundreds of activities required to create, produce, sell, and deliver their products or services, such as calling on customers, assembling final products, and training employees.
  • Cost is generated by performing activities, and cost advantage arises from performing particular activities more efficiently than competitors.
  • Similarly, differentiation arises from both the choice of activities and how they are performed. Activities, then, are the basic units of competitive advantage. Overall advantage or disadvantage results from all a company's activities, not only a few.
  • Competitive strategy is about being different. It means deliberately choosing a different set of activities to deliver a unique mix of value.
  • Strategy is making trade-offs in competing. The essence of strategy is choosing what not to do. Without trade-offs, there would be no need for choice and thus no need for strategy.
  • Strategy is creating fit among a company's activities. The success of a strategy depends on doing many things well - not just a few - and integrating among them. If there is no fit among activities, there is no distinctive strategy and little sustainability. Management reverts to the simpler task of overseeing independent functions, and operational effectiveness determines an organization's relative performance.

Fit and Sustainability

Southwest_asCompetitive advantage grows out of the entire system of activities. The fit among activities substantially reduces cost or increases differentiation. Thus in competitive companies it can be misleading to explain success by specifying individual strengths, core competencies, or critical resources. It is more useful to think in terms of themes that pervade many activities, such as low cost, a particular notion of customer service, or a particular conception of the value delivered. These themes are embodied in nests of tightly linked activities.

  • Strategic fit among many activities is fundamental not only to competitive advantage but also to the sustainability of that advantage. It is harder for a rival to match an array of interlocked activities than it is merely to imitate a particular sales-force approach, match a process technology, or replicate a set of product features. Positions built on systems of activities are far more sustainable than those built on individual activities.
  • Consider this simple exercise. The probability that competitors can match any activity is often less than one. The probabilities then quickly compound to make matching the entire system highly unlikely (.9x.9= .81; .9x.9x.9x.9= .66, and so on).

The Role of Leadership

  • The challenge of developing or reestablishing a clear strategy is often primarily an organizational one and depends on leadership. With so many forces at work against making choices and tradeoffs in organizations, a clear intellectual framework to guide strategy is a necessary counterweight.
  • In many companies, leadership has degenerated into orchestrating operational improvements and making deals. But the leader's role is broader and far more important: General management is more than the stewardship of individual functions. Its core is strategy: defining and communicating the company's unique position, making trade-offs, and forging fit among activities. The leader must provide the discipline to decide which industry changes and customer needs the company will respond to, while avoiding organizational distractions and maintaining the company's distinctiveness.

The Solution

An organization’s success at the consistent delivery of outstanding service is merely the cumulative result of the contribution of each of its members. Outstanding service is just the consequence of each individual’s choice to be great at service. That’s our decision, as individual providers, to make. It’s our responsibility. And it’s our gain.

Notes from Chapter 3, The 8th Habit, Stephen Covey

Stephen_covey Most of the great cultural shifts started with the choice of one person. Sometimes it was the formal leader; most of the time, it was not.

These agents of change first changed themselves, then inspired and lifted others. They possessed an anchored sense of identity, discovered their strengths and talents, and used them to produce results.

  • People like this don’t get sucked in or pulled down by all the negative, demoralizing, insulting forces in the organization
  • Their organizations are no better than most organizations
  • All organizations are, to some degree, a mess
  • Don’t wait for your boss or organization to change
  • Be an island of excellence in a sea of mediocrity
  • Be contagious
  • Learn your true nature and gifts
  • Use them to develop a vision of great things you want to accomplish
  • Understand the needs and opportunities around you, and meet them
  • Make a difference
  • Find and use your voice
  • Serve and inspire others
  • Inspire others to find their voice
  • All of us can decide to leave behind a life of mediocrity, and to live a life of greatness
  • We all have the power to decide to live a great life
  • No matter how long we’ve walked life’s pathway to mediocrity, we can always choose to switch paths

Good people make good service.
Good service makes good people.

Listed below are competencies extracted from the Emotional Competence Framework of the Consortium for Research on Emotional Intelligence in Organizations. They are the competencies that matter most to the success of customer service providers. Conversely, when we practice service - whether on customers, family members, colleagues, or communities - we become better at these competencies. We become better people.

Outstanding customer service providers:

  • Realize the links between their feelings and what they think, do, and say
  • Have a guiding awareness of their values and goals
  • Are reflective, learning from experience
  • Are open to candid feedback, new perspectives, continuous learning, and self-development
  • Are able to show a sense of humor and perspective about themselves
  • Can voice views that are unpopular and go out on a limb for what is right
  • Are decisive, able to make sound decisions despite uncertainties and pressures
  • Manage their impulsive feelings and distressing emotions well
  • Stay composed, positive, and unflappable even in trying moments
  • Think clearly and stay focused under pressure
  • Act ethically and are above reproach
  • Build trust through their reliability and authenticity
  • Admit their own mistakes
  • Meet commitments and keep promises
  • Hold themselves accountable for meeting their objectives
  • Are organized and careful in their work
  • Smoothly handle multiple demands, shifting priorities, and rapid change
  • Adapt their responses and tactics to fit fluid circumstances
  • Seek out fresh ideas from a wide variety of sources
  • Entertain original solutions to problems
  • Generate new ideas
  • Are results-oriented, with a high drive to meet their objectives and standards
  • Set challenging goals and take calculated risks
  • Pursue information to reduce uncertainty and find ways to do better
  • Learn how to improve their performance
  • Readily make personal or group sacrifices to meet a larger organizational goal
  • Find a sense of purpose in the larger mission
  • Pursue goals beyond what’s required or expected of them
  • Cut through red tape and bend the rules when necessary to get the job done
  • Persist in seeking goals despite obstacles and setbacks
  • Are attentive to emotional cues and listen well
  • Show sensitivity and understand others’ perspectives
  • Help out based on understanding other people’s needs and feelings
  • Understand customers’ needs and match them to services or products
  • Seek ways to increase customers’ satisfaction and loyalty
  • Gladly offer appropriate assistance
  • Grasp a customer’s perspective, acting as a trusted advisor
  • Are skilled at persuasion
  • Fine-tune presentations to appeal to the listener
  • Are effective in give-and-take, registering emotional cues in attuning their message
  • Deal with difficult issues straightforwardly
  • Handle difficult people and tense situations with diplomacy and tact
  • Orchestrate win-win solutions

In addition, outstanding customer service leaders:

  • Acknowledge and reward people’s strengths, accomplishments, and development
  • Offer useful feedback and identify people’s needs for development
  • Mentor, give timely coaching, and offer assignments that challenge and grow a person’s skill.
  • Understand the forces that shape views and actions of clients, customers, or competitors
  • Accurately read situations and organizational and external realities
  • Use complex strategies like indirect influence to build consensus and support
  • Listen well and seek mutual understanding
  • Welcome sharing of information fully
  • Foster open communication and stay receptive to bad news as well as good
  • Articulate and arouse enthusiasm for a shared vision and mission
  • Step forward to lead as needed, regardless of position
  • Guide the performance of others while holding them accountable
  • Lead by example
  • Recognize the need for change and remove barriers
  • Challenge the status quo to acknowledge the need for change
  • Champion the change and enlist others in its pursuit
  • Model the change expected of others
  • Spot potential conflict, bring disagreements into the open, and help deescalate
  • Encourage debate and open discussion
  • Build rapport and keep others in the loop
  • Make and maintain personal friendships among work associates
  • Balance a focus on task with attention to relationships
  • Collaborate, sharing plans, information, and resources
  • Promote a friendly, cooperative climate
  • Model team qualities like respect, helpfulness, and cooperation
  • Draw all members into active and enthusiastic participation
  • Build team identity, esprit de corps, and commitment
  • Protect the group and its reputation
  • Share credit

See also this article which codes the whole EC Framework according to customer service requirements: basic competencies, higher-level competencies, and competencies for customer service leaders.

Sam Walton's 10 Rules

Excerpts from Running a Successful Company: Ten Rules that Worked for Me
Sam Walton, in Made in America

I didn't expect to find "get taxpayers to pay for your health insurance" on this list, and I didn't. Still, it's a pretty good list.

Sam_walton This isn’t the first time that I’ve been asked to to come up with a list of rules for success, but it is the first I’ve sat down and done it. I’m glad I did, because it’s been a revealing exercise for me.

I do seem to have a couple of dozen things that I’ve singled out at one time or another as the “key” to the whole thing. One thing I don’t even have on my list is “work hard”. If you don’t know that already, you probably won’t be going far enough to need my list anyway. Another thing I didn’t include on my list is the idea of building a team. It almost goes without saying that you absolutely must create a team of people who work together and give real meaning to the overused word “teamwork”. To me, that’s more the goal of the whole thing, rather than some way to get there. 

  1. COMMIT to your business. Believe in it more than anybody else. If you love your work, you’ll be out there every day trying to do it the best you possibly can, and pretty soon everybody will catch the passion from you – like a fever.
  2. SHARE your profits with all your associates, and treat them as partners. In turn, they will treat you as a partner, and together you will perform beyond your wildest expectations. Encourage your associates to hold a stake in the company. Behave as a servant leader in a partnership.
  3. MOTIVATE your partners. Money and ownership alone are not enough. Constantly think of new and more interesting ways to motivate and challenge your partners. Set high goals, encourage competition, and then keep score. If things get stale, cross-pollinate – have managers switch jobs with one another to stay challenged.
  4. COMMUNICATE everything you can with your partners. The more they know, the more they’ll understand. The more they understand, the more they’ll care. Once they care, there’s no stopping them. Information is power, and the gain you get from empowering your associates more than offsets the risk of informing your competitors.
  5. APPRECIATE everything your associates do for the business. All of us like to be told how much somebody appreciates what we do for them. We like to hear it often, especially when we have done something we’re really proud of. Nothing can substitute for a few well-chosen, well-timed, sincere words of praise. They’re absolutely free – and worth a fortune.
  6. CELEBRATE your successes. Find some humor in your failures. Don’t take yourself so seriously. Show enthusiasm – always.
  7. LISTEN to everyone in your company, and figure out ways to get them talking. The folks on the front lines – the ones who actually talk to the customer – are the only ones who really know what’s going on out there. You’d better find out what they know. To push responsibility down in your organization, and to force good ideas to bubble up, you must listen to what your associates are trying to tell you.
  8. EXCEED your customers’ expectations. If you do, they’ll come back over and over. Give them what they want – and a little more. Let them know you appreciate them. Make good on all your mistakes, and don’t make excuses – apologize. Stand behind everything you do. The two most important words I ever wrote were on that first Wal-Mart sign: “Satisfaction Guaranteed”.
  9. CONTROL your expenses better than your competition. You can make a lot of mistakes and still recover if you run an efficient operation. Or you can be brilliant and still go out of business if you’re too inefficient.
  10. SWIM upstream. Go the other way. Ignore conventional wisdom. If everybody else is doing it one way, there’s a good chance you can find a niche by going in exactly the opposite direction.

Those are some pretty ordinary rules, some would say even simplistic. The hard part, the real challenge, is to constantly figure out ways to execute them. You can’t just keep doing what works one time, because everything around you is always changing. To succeed, you have to stay out in front of that change.

Bass ackwards

Most writers in the field of customer service maintain that the commitment of an organization's top management is critical to the success of any customer service initiative. I agree, but I don't.

If the customer service revolution depended on our leaders, we'd all be in serious trouble. Most of them confuse customer service with lip service. They say the right things, but generally do not understand what they're saying. Outstanding customer service will not happen just because our leaders say they're customer-focused, or customer-centric, or whatever the current buzzword is. Almost as soon as top managers realize what it really takes, they lose interest. There's nothing sexy, or flashy, or fast about customer service. It's the tortoise, not the bunny.

And so it's far too slow for most managers, who are under constant pressure to produce immediate results. Customer service will never bring them that. Far easier to slash prices, advertise, buy a new crm system, cut payroll.

I am convinced that the revolution must be led by the masses. The elite are welcome to follow.

See also: Revolution management, The revolution begins with you, The solution

Close to the customer

Excerpts from In Search of Excellence
Tom Peters & Robert Waterman Jr, Chapter 6: Close to the Customer

  • The best outside analysis of the close-to-the-customer-through service concept that we have come across was performed by Dinah Nemeroff.
  • Nemeroff finds three principal themes in an effective service orientation: (1) intensive, active involvement on the part of senior management; (2) a remarkable people orientation; and (3) a high intensity of measurement and feedback.
  • As we have found over and over, it starts with senior management. Nemeroff neatly calls it “Service statesmanship". Senior executives exercise that statesmanship through personal example.
  • Their commitment starts with a company philosophy. With service as their top goal, they said that “profitability naturally follows”.
  • Nemeroff found that top management directly intervenes in decisions about service. These mangers have frequent regular meetings with junior professionals who respond to customer mail. They pen “marginal notes on customer correspondence.” And “engage in dramatic service delivery gestures to increase visibility to customers.” (And, we would add, to reinforce this service message throughout their own organizations.)
  • Of another aspect of top management style, Nemeroff makes a crucial and surprisingly subtle point: “Interviewed executives believe they must maintain a long-term view of service as a revenue builder.” This point is all too often missed in big American companies.
  • Profit objectives, while very necessary, are internally focused and certainly do not inspire people by the thousands way down the line.
  • Service objectives, on the other hand, are almost without fail meaningful to down-the-line employees. A strong sense of personal accountability among down-the-line employees is crucial. And one knows that has been accomplished when someone in the field says “Each one of us is the company.”
  • Nemeroff makes the important connection that “customer relations simply mirror employee relations.”
  • Inseparable from the way the service-oriented companies manage their people is the intensity of measurement and feedback systems. Perhaps her most significant finding in this regard was that new rewards and incentive programs are in continuous preparation.
  • This really struck us in all aspects of the work of the excellent companies. Programs for people - incentive programs, training programs, or simple hoopla - undergo continuous retuning, much as product development does. No practice is expected to have impact forever, and programs for people have life cycles just as products do, maybe even shorter ones.

The revolution begins with you

When I started this blog, one of my concerns was that the customer service literature mainly tends to treat those of us who actually provide the service as objects to be manipulated (see "That's a good doggie"). I argue that for any customer service program to succeed, providers must turn that bias on its head. We must exercise leadership, and take personal responsibility for our success. While trying to develop that theme, I recalled this article by Peter Drucker, who died in November 2005, after having devoted 70 of his 95 years to the hope that he could make us better people, as well as better managers.

Excerpts from Managing Oneself
Peter Drucker, in Harvard Business Review

Peter_drucker We live in an age of unprecedented opportunity: If you've got ambition and smarts, you can rise to the top of your chosen  profession, regardless of where you started out. But with opportunity comes responsibility. It's up to you to carve out your place, to know when to change course, and to keep yourself engaged and productive.

To do those things well, you'll need to cultivate a deep understanding of yourself -- not only what your strengths and weaknesses are but also how you learn, how you work with others, what your values are, and where you can make the greatest contribution. Because only when you operate from strengths can you achieve true excellence.

What Are My Strengths?

  • A person can perform only from strength.
  • We need to know our strengths in order to know where we belong.
  • Most people think they know what they are good at. They are usually wrong.
  • The only way to discover your strengths is through feedback analysis. Whenever you make a key decision or take a key action, write down what you expect will happen. Nine or 12 months later, compare the actual results with your expectations.
  • Several implications for action follow from feedback analysis.
  • First and foremost, concentrate on your strengths. Put yourself where your strengths can produce results.
  • Second, work on improving your strengths.
  • Third, discover where your intellectual arrogance is causing disabling ignorance and overcome it. Far too many people -- especially people with great expertise in one area -- are contemptuous of knowledge in other areas or believe that being bright is a substitute for knowledge.
  • It is equally essential to remedy your bad habits -- the things you do or fail to do that inhibit your effectiveness and performance.
  • One should waste as little effort as possible on improving areas of low competence. It takes far more energy and work to improve from incompetence to mediocrity than it takes to improve from first-rate performance to excellence.

How Do I Perform?

  • Amazingly few people know how they get things done. Indeed, most of us do not even know that different people work and perform differently. Too many people work in ways that are not their ways, and that almost guarantees nonperformance.
  • Like one's strengths, how one performs is unique. It is a matter of personality.
  • Just as people achieve results by doing what they are good at, they also achieve results by working in ways that they best perform. A few common personality traits usually determine how a person performs.
  • Am I a reader or a listener? What’s the best way for you to get information? The first thing to know is whether you are a reader or a listener. Far too few people even know that there are readers and listeners and that people are rarely both. Even fewer know which of the two they themselves are.
  • How do I learn? There are people who learn by writing. Some people learn by taking copious notes. Some people learn by doing. Others learn by hearing themselves talk.
  • Do I work well with people, or am I a loner? And if you do work well with people, you then must ask, In what relationship? Some people work best as subordinates. Some people work best as team members. Others work best alone.
  • Do I produce results as a decision maker or as an adviser? A great many people perform best as advisers but cannot take the burden and pressure of making the decision. A good many other people, by contrast, need an adviser to force themselves to think; then they can make decisions and act on them with speed, self-confidence, and courage.
  • Do I perform well under stress, or do I need a highly structured and predictable environment?
  • Do I work best in a big organization or a small one?.
  • Do not try to change yourself -- you are unlikely to succeed. But work hard to improve the way you perform. And try not to take on work you cannot perform or will only perform poorly.

What Are My Values?

  • To be able to manage yourself, you finally have to ask, What are my values?
  • Organizations, like people, have values. To be effective in an organization, a person's values must be compatible with the organization's values. They do not need to be the same, but they must be close enough to coexist. Otherwise, the person will not only be frustrated but also will not produce results.
  • A person's strengths and the way that person performs rarely conflict; the two are complementary. But there is sometimes a conflict between a person's values and his or her strengths. What one does well--even very well and successfully -- may not fit with one's value system. In that case, the work may not appear to be worth devoting one's life to.
  • Values are and should be the ultimate test.

Where Do I Belong?

  • Most people, especially highly gifted people, do not really know where they belong until they are well past their mid-twenties. By that time, however, they should know the answers to the three questions: What are my strengths? How do I perform? and, What are my values? And then they can and should decide where they belong.
  • Or rather, they should be able to decide where they do not belong. The person who has learned that he or she does not perform well in a big organization should have learned to say no to a position in one. The person who has learned that he or she is not a decision maker should have learned to say no to a decision-making assignment.
  • Equally important, knowing the answer to these questions enables a person to say to an opportunity, an offer, or an assignment, "Yes, I will do that. But this is the way I should be doing it. This is the way it should be structured. This is the way the relationships should be. These are the kind of results you should expect from me, and in this time frame, because this is who I am.”
  • Successful careers are not planned. They develop when people are prepared for opportunities because they know their strengths, their method of work, and their values. Knowing where one belongs can transform an ordinary person -- hardworking and competent but otherwise mediocre -- into an outstanding performer.

What Should I Contribute?

  • Knowledge workers have to learn to ask a question that has not been asked before: What should my contribution be? To answer it, they must address three distinct elements: What does the situation require? Given my strengths, my way of performing, and my values, how can I make the greatest contribution to what needs to be done? And finally, What results have to be achieved to make a difference?
  • It is rarely possible -- or even particularly fruitful -- to look too far ahead. A plan can usually cover no more than 18 months and still be reasonably clear and specific. So the question in most cases should be, Where and how can I achieve results that will make a difference within the next year and a half? The answer must balance several things.
  • First, the results should be hard to achieve -- they should require "stretching," to use the current buzzword. But also, they should be within reach. To aim at results that cannot be achieved -- or that can be only under the most unlikely circumstances -- is not being ambitious; it is being foolish.
  • Second, the results should be meaningful. They should make a difference.
  • Finally, results should be visible and, if at all possible, measurable.
  • From this will come a course of action: what to do, where and how to start, and what goals and deadlines to set.

Responsibility for Relationships

  • Very few people work by themselves and achieve results by themselves. Most people work with others and are effective with other people. Managing yourself requires taking responsibility for relationships. This has two parts.
  • The first is to accept the fact that other people are as much individuals as you yourself are. This means that they too have their strengths; they too have their ways of getting things done; they too have their values. To be effective, therefore, you have to know the strengths, the performance modes, and the values of your coworkers.
  • Bosses are individuals and are entitled to do their work in the way they do it best. It is incumbent on the people who work with them to observe them, to find out how they work, and to adapt themselves to what makes their bosses most effective. This, in fact, is the secret of "managing" the boss.
  • The same holds true for all your coworkers. Each works his or her way, not your way. And each is entitled to work in his or her way. What matters is whether they perform and what their values are. As for how they perform -- each is likely to do it differently. The first secret of effectiveness is to understand the people you work with and depend on so that you can make use of their strengths, their ways of working, and their values.
  • The second part of relationship responsibility is taking responsibility for communication. Most conflicts arise from the fact that people do not know what other people are doing and how they do their work, or what contribution the other people are concentrating on and what results they expect. And the reason they do not know is that they have not asked and therefore have not been told.
  • Organizations are no longer built on force but on trust. The existence of trust between people does not necessarily mean that they like one another. It means that they understand one another. Taking responsibility for relationships is therefore an absolute necessity. It is a duty.

Conclusion

The challenges of managing oneself may seem obvious, if not elementary. And the answers may seem self-evident to the point of appearing naïve. But managing oneself requires new and unprecedented things from the individual, and especially from the knowledge worker. In effect, managing oneself demands that each knowledge worker think and behave like a chief executive officer. Further, the shift from manual workers who do as they are told to knowledge workers who have to manage themselves, profoundly challenges social structure. Every existing society, even the most individualistic one, takes two things for granted, if only subconsciously: that organizations outlive workers, and that most people stay put.

But today the opposite is true. Knowledge workers outlive organizations, and they are mobile. The need to manage oneself is therefore creating a revolution in human affairs.

The most powerful position in retail

Notes from The Most Powerful Position in Retail
Kurt Deneen, Gallup Management Journal

  • Managing a retail operation is no simple task. But things run much more smoothly when a store has the right person in place for perhaps the most important job in retail: store manager.
  • While many other positions in a field organization are crucial, retailers can win -- and win big -- if they have a great person in the store manager position.  Store managers have the biggest impact on a store's success because they set the standards for what the customer sees and how the team performs.
  • To maintain a strong "bench" of possible store managers, senior retail executives must always be looking for people with a passion to manage in the retail business, and the ability to lead a team. Not all store managers have both those qualities. Great managers are driven by a desire to run a great business, one that they could proudly represent.

Priorities: Build a strong team, focus on the customer, support employee performance with tight operating systems.

Build a strong team

  • Exude an upbeat attitude, even if your personality is low key
  • Find the right fit for people, and set them up for success in their roles
  • Coach your team to a higher level of performance
  • Observe the team's sales skills
  • Gives direct feedback

Focus on the customer

  • Look at the store from the customer's point of view
  • Review service standards with the team
  • Identify key drivers of customer impression
  • Stand in the middle of the sales floor
  • Talk to customers
  • Monitor traffic flow

Support performance with tight operations

  • Plans each day's business
  • Establish processes of execution, particularly in (a) shipment processing and stocking, (b) staff scheduling, (c) supply replenishment
  • Execute standard operating procedures on processes that should be on auto-pilot so that the team’s energy and creativity could be channeled into customer service and people development.

Goleman on empathy

Excerpts from An EI-Based Theory of Performance
Daniel Goleman in The Emotionally Intelligent Workplace 
Edited by Cary Cherniss and Daniel GolemanEc_framework

Managing relationships well depends on a foundation of Self-Management and Empathy, each of which in turn requires Self-Awareness. If we cannot control our emotional outbursts or impulses and lack Empathy, there is less chance we will be effective in our relationships.

Neurological bases

  • Patients with lesions in the prefrontal-amygdala circuits that undergird both Self-Management and Empathy show marked deficits in relationship skills, even though their cognitive abilities remain intact. When Damasio (1994) administered an EI measure to one such patient, he found that though the patient had an IQ of 140, he showed marked deficits in self-awareness and empathy (Bar-On, 2000b).
  • Primate studies find parallel effects. Monkeys in the wild who had this prefrontal-amygdala circuitry severed were able to perform food gathering and similar tasks to maintain themselves but lacked all sense of how to respond to other monkeys in the band, even running away from those who made friendly gestures (Brothers, 1989).

Empathy at work

  • The Empathy competence gives people an astute awareness of others’ emotions, concerns, and needs. The empathic individual can read emotional currents, picking up on nonverbal cues such as tone of voice or facial expression. Empathy requires Self-Awareness; our understanding of others’ feelings and concerns flows from awareness of our own feelings. This sensitivity to others is critical for superior job performance whenever the focus is on interactions with people.
  • The ability to read others’ needs well comes naturally to the best managers of product development teams (Spencer & Spencer, 1993).
  • Skill in Empathy correlates with effective sales, as was found in a study among large and small retailers (Pilling & Eroglu, 1994).
  • In an increasingly diverse workforce, the Empathy competence allows us to read people accurately and avoid resorting to the stereotyping that can lead to performance deficits by creating anxiety in the stereotyped individuals (Steele, 1997).

Empathy & Communication

  • People who exhibit the Communication competence are effective in the give-and-take of emotional information, deal with difficult issues straightforwardly, listen well and welcome sharing information fully, and foster open communication and stay receptive to bad news as well as good.
  • This competence builds on both managing one’s own emotions and empathy; a healthy dialogue depends on being attuned to others’ emotional states and controlling the impulse to respond in ways that might sour the emotional climate. Data on managers and executives show that the better people can execute this competence, the more others prefer to deal with them (J. Walter Clarke Associates, cited in Goleman, 1998b).

Empathy & Leadership

  • Visionary leaders are empathic, self-confident, and often act as agents of change. Leadership_style_1
  • Affiliative leaders are empathic, with strengths in building relationships and managing conflict.
  • The democratic leader encourages collaboration and teamwork and communicates effectively—particularly as an excellent listener.
  • The coaching leader is emotionally self-aware, empathic, and skilled at identifying and building on the potential of others.