As the saying goes, “Timing is everything.” Someone at Microsoft should tell the big boss. It seems to me that Satya Nadella, the new CEO at Microsoft as of February, has been let down by his PR people in the communications of the last two weeks. The order of announcements could not have been worse.

In an e-mail to employees (July 10) about an evolving culture at Microsoft, Nadella talked of “Bold Ambition and Our Core“ and outlined what the company has to do to get its mojo back. One week later (July 17), he announced a layoff of 18,000 employees. Talk about a letdown. My take on the two messages: “I have some good news and some bad news. I’ll give the good news first: Microsoft is going to be a lean, mean fighting machine. The bad news: Many of you will not be a part of it.”

There are at least two problems with these announcements, but let me first say I have no problem with the decision to eliminate jobs. (read more…)

A decade ago, the skill set of the HR leader was defined by the classic 80/20 rule: 80% HR administration, 20% business. Today, this rule has been overturned. A company’s HR executive is a critical component of the leadership team. CEOs are increasingly pulling HR professionals to the leadership table, asking them to play a more strategic role and requiring that they have a firm understanding of the business and its long-term goals.

This trend speaks to the changing nature of the HR leadership function across industries. Businesses are becoming more attuned to the importance of internal culture to recruit and retain talent, and, consequently, HR leaders must serve as the CEO’s business partner and align their talent-development strategy with overall business imperatives. As HR professionals participate in organization-wide decisions, they’re required to more fully understand the business and think beyond the bounds of what would traditionally be considered “HR territory.”

If CEOs want to see their businesses thrive, they need to ensure that they have the right partner in the HR leadership role. (read more…)

A nervous group walks into the conference group. They are still trying to shake off the holiday haze, but are totally alert and loaded for bear. It’s our vice president of sales’ first all-hands call of the year and the team has honed in on one agenda item: This year’s quota.

Loni comes on and confidently runs through our end of year results. Then she sheepishly tackles the quota. “We expect that quotas will be handed out at the sales leadership meeting in a few weeks. We hope to see…”

Rizzo thrusts out his arm and stamps down the mute button of the Polycom star phone that sits in the middle of the long oak table. “This is looking at lot like last year, boss.” He stares at me. The rest quickly follow suit.“I suppose we won’t get our objectives until July again,” he finishes.

Loni keeps on talking, but nobody is listening. (read more…)

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In February, CVS announced it would stop selling tobacco products, and take a $2 billion hit to the bottom line, because they were starkly at odds with the company’s core purpose of promoting customer health. Larry Merlo, president and CEO of CVS Caremark, said in a news release, “Ending the sale of cigarettes and tobacco products at CVS/pharmacy is the right thing for us to do … to help people on their path to better health. Put simply, the sale of tobacco products is inconsistent with our purpose.”

More recently, Starbucks unveiled the College Achievement Plan for any Starbucks employee that will cover some or all of the tuition for Arizona State University’s online degree programs. If only 3% of its workforce takes advantage of the program, then it could cost Starbucks $50 million annually. That may sound like a lot of money. But, Howard Schultz, the founder and CEO of Starbucks, told the press that the program would not only lower attrition, increase performance, and attract and retain talent, but it is also in alignment with Starbucks’ mission: to “inspire and nurture the human spirit — one person, one cup and one neighborhood at a time.” What inspires and nurtures the human spirit more than getting a good education? (read more…)

While the ignition problems at General Motors and the falsified waiting lists at Veterans Affairs may not seem comparable, there is one distinct parallel. In both cases, leaders were managing to results.

It’s hard to believe that in today’s business environment, many organizations are still employing practices that not only don’t work but can also harm people. In these organizations, it’s typical for leaders to set the numbers and then monitor results to determine if people are reaching them. What they fail to understand is that results alone are not enough.

Managing by results is similar to driving in a big city by looking only in the rear view mirror: It doesn’t tell you what lies ahead. Problems often show up months or years later, when they are extremely costly to correct, as was true in the case of both GM and the VA

Employees and managers can cheat to get results. (read more…)