THE MANAGEMENT COLUMNS

Find here the most recent columns about management by Renzo Pellandini, Executive Coach, Transformation Specialist and Facilitator.

Leadership pipeline a structural weakness in Taiwan?

Succession risks of large companies in Taiwan make the news constantly. Just yesterday, the MarketCurrents WealthNet published an article about Taiwan’s Family Business Succession Issues stating that up to 56% of the family-owned corporations in Taiwan are still owned by the original founders, by now most over the age of 70. A similar warning signal was published by Taipei Times on May 25, and multiple further articles were released in the past years, mostly after some catastrophic succession caused by the sudden death of the founder and chairman.

 

While the media and analysts mainly focus on the large corporations in Taiwan, I would like to raise the concern that the succession planning crisis is not only affecting the large corporations but is actually omnipresent throughout the business sector for any size of the company. While, of course, the responsibility of succeeding the head of a large company is not comparable to replace the head of an SME, the resulting impact is similar. 

Badly planned succession disrupts the business continuity and causes a huge waste of resources. The Taipei Times articles rated succession planning among the top three areas of concern, together with the potential declining profits in the ICT industry and insufficient reinvestment. The editor concluded the article stating that “Without adequate planning, succession issues in family-run corporations could pose considerable organizational risks.”

 

Why do Taiwan enterprises struggle with succession planning? There are multiple factors in play that need to be considered. Nevertheless, the primary trigger for the challenge is the traditional approach of founders to divide the family business up between the children and family members. This approach has lead, unfortunately, to tensions among the family members weakening the company in the process.

Some companies in Taiwan have become simply so large that younger family members have been left incapable of taking on the top position in the company. 

 

Interestingly I could observe similar patterns also in SME or local branches of global companies. The leaders struggle to consistently create a succession plan that is more than just a list of names. Higher and middle managers tend to be defending their position instead of seeing the growth of their high performers and talents as an opportunity to progress themselves in their careers.

In short, we are missing a leadership pipeline strategy.

 

In a 2003 HBR article, Conger and Fulmer already perfectly synthesized the elements required to secure a sustainable succession in companies. The authors’ research highlighted the two practices that create a long-term process for managing talent bench across their organization, the two practices been the combination of succession planning and leadership development. The activity would have a clear focus on the strategic direction of the company to create leaders that have the right characteristics to drive the future strategy.

 

Leadership development should be focused on building people’s skills within the company’s context and evolving objectives. Leadership pipeline development is much more than a matrix of high-potential employees and the slots that they might fill. It is much more about integrating  succession planning with leadership development, and achieving the best of both: “attention to the skills required by senior managers to guide the future organization and a sustainable development structure that helps managers develop those skills.”

 

As a senior leader in a large or small company in Taiwan, ask yourself, if the organization would be able to operate without you for more than 6 months. If you get to the conclusion that your presence is indispensable, you might have a succession issue. 

 

Last week I wrote an article about Strategic Thinking and Strategic Planning; both are very much related to Succession Planning.

In fact, Succession Planning should be an integral part of your future strategy as you want to build the assets and driving force that will shape your future activity. And it is irrelevant whether you are leading a big corporate or an SME; the challenge and impact of not preparing a leadership pipeline are similar, leading to confusion, tension, and waste.

 

Building up a leadership pipeline is not too complicated and does not require major investments. The critical challenge is the mindset to properly preparing family members or high performers to be able to take up the future activity. The world and industry are changing fast, and as such, we need future leaders to be able to cope and master such changes. Luckily there are also solutions for those companies that don’t have appropriate training and coaching capabilities to develop the talents; they can rely on competent external resources. These external resources can deliver efficiently focused development activities, provided that the leadership team can provide a clear picture of the direction and strategy that the company wants to target in the future.

 

It is not too later to build a leadership pipeline. It requires the determination of the leaders to fully support the approach and to provide the space for the candidates to experience and stretch their capabilities.

Start today, reviewing your succession strategy and organize your pipeline and experience and skilled leaders.

 

Planning the Post-COVID with strategic thinking, NOW!

How will your workflow look like in two months? What about in two quarters or two years? The COVID crisis is dramatically highlighting a general lack of strategic thinking in organizations. From companies to governments, we can observe tactical actions to try to contain the worst; nevertheless, only a few organizations really assume, plan and prepare for a real shift in the workflow and operation of their organizations to be prepared to operate whatever the future will through at them. Companies and governments resuming “normal life” after lockdown seem to move back to business as usual as if the virus is gone, or that the population has become suddenly immune. The recent second wave spikes in some regions demonstrate that “business as usual” is not sustainable and that a shift in operation is required to secure at the same time the health of the people and the economy. Very few countries, including Taiwan, have demonstrated that it is possible to have both, securing health and maintaining the economy, thanks to plans that were defined in the aftermath of SARS. What is wrong with our companies and organizations? One of the elements mostly missing in organizations to be able to shape a safe and sustainable future workflow, is the ability of the management to think and plan strategically.

 

Strategic thinkings is defined as: “finding and developing a strategic foresight capacity for an organization, by exploring all possible organizational futures, and challenging conventional thinking to foster decision making today.” Moreover, strategic thinking “is a mental process, at once abstract and rational, which must be capable of synthesizing both psychological and material data. The strategist must have a great capacity for both analysis and synthesis; analysis is necessary to assemble the data on which he makes his diagnosis, synthesis to produce from these data the diagnosis itself—and the diagnosis, in fact, amounts to a choice between alternative courses of action.” We should also distinguish between strategic thinking, which is more about connecting the dots and strategic planning, which is defining the practical plan to achieve the strategic milestones.

One big mistake that organizations do is to expect all strategic decisions and plans to come from the top. While this is correct for the overall direction of a company, it is a flawed assumption for any decision that could be made locally, and that could greatly affect the performance, wellbeing, and sustainability of the local team in the future. For instance, basically, all companies scrambled tactically to secure video conferencing and virtual team room capabilities. Nevertheless, only a handful of companies has been considering the psychological impact that shifting overnight from a conventional program-management approach to an exclusively virtual one. The companies with foresight have immediately started training and supporting their teams to improve their skills and capability to effectively communicate and manage over digital means. Building their capability to make decisions virtually and to effectively resolve problems remotely. The general feedback that we hear from the industry is that employees have moved from an eight-hour workday to a twelve-hours and never-ending-evening working days. Most of the people I’m supporting complain about an increase in “meeting time and frequency” with the feeling that since it is easy to organize a virtual meeting, now everybody wants to control what is going on. For some teams and employees, this has become a nightmare work environment. Where less time is available to create value-adding content, and more time is wasted by been controlled. This doesn’t sound like a strategic move, but rather a panic reaction to the situation.


Obviously, one of the challenging factors is that most companies are rightly cutting spending, given the volatile situation. Yet, this shouldn’t be stopping people from thinking strategically and starting planning the next steps once the budget freeze is lifted. Unfortunately, this is what is happening for many organizations that I’m interviewing. The prevailing message is, “sorry now we don’t have the budget we will restart the discussion once the situation improves.” Knowing that organizing a development project could last up to between three to six months, it would mean that the teams might get some deserved support in maybe two to four quarters. The COVID crisis is possibly imposing a transformation of the way we were doing things. I truly hope that we will be able to go back to the old normal. Yet, at the same time, I don’t believe that we have the option for “wait and see.” The time to support our organizations and people to transform into a sustainable operation coexisting with the virus is NOW. Don’t waste precious time that could be used to build the skills and mindset of your teams and leaders.

Think strategic first, build a strategic plan, and act to support your people immediately after once the budget is available.

  

   

   

Digital communication between High- and low-context cultures

A few weeks ago I bumped into an interesting article related to “The psychological impact of video calls,” the information intrigued me to spend some more time on the topic and understand if the sources were reputable. It turned out that not only the sources had a solid academic background and that other articles and studies highlighted similar challenges linked with the extensive or exclusive use of video conferencing. Some of these studies were released five to seven years ago; nevertheless, they emerged in relevance with the current COVID crisis, which literally imposed companies and countries to rely on video conferencing to progress with their activity.

The article highlights the psychological challenges that users might experience when extensively using video conferencing as the main communication channel. The challenges range from mental fatigue, anxiety, lack of attention, and reduced context leading to lower quality interactions.
The studies dive into the effects that video calls have on the users as well as the root causes. Some elements might seem irrelevant yet have large subconscious effects.
 

One of the elements that made me smile is the realization that during video calls, we constantly look to ourselves.  In the article, H Locke compares it to being in a physical meeting and that every seat also has a mirror in front of it, where you see your counterpart and yourself at the same time. You realize that seeing yourself alters your behaviors.  In any video call system, you always see all faces, including yours, adding to the distraction level as well as largely increasing the level of cognitive processing about the self. This additional subconscious cognitive load adds on top of the stress caused by the lockdown or any other technical or commercial issues that need to be discussed in the call. The increased stress and the reduced ability to read social cues might lead to misunderstandings and errors. The people in a call might react more negatively than in physical meetings. 
Additionally, video calls lack in the post-meeting interaction that the physical meeting offer. People in a physical meeting would continue some talk after the meeting that is often key to process misunderstandings or tensions. Unfortunately, video calls end with a click, and no post-processing is possible.


Now, you might argue that people have got used to communicating through social media. In fact, if you go on any public transportation in any place of this planet, you will see between 70-90% of the people immersed in their phones. Most of them might be so focused on their device to the point of being oblivious to the people around them. I have fun sometimes to observe people when riding the MRT in Taipei. Indeed, most people are masters in using social media; nevertheless, you might notice that most of the interaction is written text or voice messages. People use digital communication channels in a “single message burst” mode and not in a fluid dialogue. 
It is obviously different chatting with a friend or family member, compared to trying to resolve a business problem or reach a collective decision. These situations need you to dialogue in real-time with your counterparts on the other side of the screen.

Humans are social beings that require a high degree of social cues to make sense of the information that we are receiving. Video calls, while better than phone calls, provide only an extremely limited palette of cues making the contextual interpretation much more difficult and error-prone. 

Let us add now one more element in the equation, the cultural contextual biases.

Low vs. high context cultures

If you are working in a global company, the chance is high that you have teams from various geographical regions collaborating on the same project. And you likely have a team in the West collaborating with a team in the East. While most of us have heard that there are differences in the communication patterns and habits between cultures, only a few of us have really dived into the complexity of cultural communication diversity.
Among the various cultural patterns that might affect how we communicate the most impactful is whether a culture uses high or low context communication.
 

The chart highlights the diversity and nuances of cultural biases towards adding context to communication. 
People from high-context cultures rely on implicit communication and nonverbal cues to make sense of the information. In high-context communication, a message is hard to interpret without extensive background information. Asian, African, Arab, some central European, and Latin American cultures are generally considered to be high-context cultures.

Low context cultures might use digital communication channels, like video calls, without too many negative effects. Yet unfortunately, it is evident that high context cultures suffer and are affected by the use of video calls because of the limited ability to transmit the contextual cues.

Carol Kinsey Goman, a prominent international keynote speaker and seminar leader on body language and leadership presence, describes the contextual diversity in the following way. Contextual diversity explains why “people in Japan or Taiwan (both high-context cultures) prefer face-to-face communication over electronic technology favored by other industrialized countries like the United States, Canada, the United Kingdom, and Germany (low-context cultures).” She farther goes on to explain that “High-context cultures also prefer personal bonds and informal agreements over meticulously worded legal documents. They “are looking for meaning and understanding in what is not said — in body language, in silences and pauses, and in relationships and empathy.”

One week ago, I wrote an article about the illusion of normality post-COVID crisis in Asia. With today’s article, I would like to raise your awareness of this subtle yet critical communication challenge that teams in global companies face due to the travel restrictions that might become the new standard.
Organizations must go beyond just buying licenses to video conferencing tools. Organizations must care to develop the skills of the teams to cope with the new “communication approach” and for the psychological wellbeing of their teams.
Cross-cultural communication skills are learnable as well as strategies and methods that mitigate the negative impact that video calls have on your teams and the quality of their work.

Next week we will address another challenge that I often observe, the missing strategic thinking and proactively preparing for the next steps.
 

Taiwan Post COVID-19: “Business as Usual” or Illusion?

What has happened with all the businesspeople coming to Taiwan to follow up on running projects? The airports are empty, while services like Zoom have skyrocketed in just 2 months.
On the surface, the marked shift towards using digital media to communicate with oversea teams is positive, as it reduces travel costs and improves efficiency, but there is a downside.

The following is the unspoken challenge that Taiwan’s industries must cope with during this global crisis.

The issue is certainly not the “physical” impact of COVID since the island has successfully managed to avoid an indigenous spread of the virus. The impact is much more subtle, as it is not so visible nor might have an immediate impact on the running projects. I have been supporting local teams during the entire period since January when it became apparent that COVID required strong preventive actions.  The common theme that I could observe in almost all the teams has been a sharp delay in “decision-making” and “problem-solving.” At that time everybody easily attributed the delay to the limited access of oversea experts. Nevertheless, when coaching individual members, I realized that also, local decisions and problem-solving were impacted by the delays. Such delays could not be transparently attributed to oversee decision-makers.

What is going on? Why are teams all of a sudden not able to progress smoothly? We started reviewing the procedure and practices of the affected teams. We observed that the variable which had most shifted since January was the missing physical presence onsite of oversea staff. At the same time, the virtual meetings with digital media had intensified, largely over-compensating in time for the physical presence in meetings.

But did virtual meetings really compensate for the presence? For those teams that experienced delays, it did not compensate at all. In fact, it might even have negatively reduced the time where the team members would be creating value outside meetings.

When discussing with the managers of those teams, they all expressed confidence that the team would be operating in a “business as usual mode,” and they also seemed to tolerate the delayed decisions and solutions, maybe because the rest of the planet has been moving in slow motion during the last three months.

Given the challenges that I could observe and help correct, most of the teams are currently operating under the illusion of “business as usual.” It is “simpler” to justify the delays by external factors than by structural weaknesses in the way local teams operate that have become more apparent with the crisis. The managers that I have been supporting realize that there is a need to transform the capability of the local teams to be less dependent on the physical presence of oversea experts. They know that they need to develop skills and mindset that allow the teams to communicate and progress even during global crisis situations. We should not be confusing with the technological means of communication, but really to the mindset and cultural biases that differentiate the quality of interaction between team members. In a future post, I will elaborate more on the communication biases aspect.

The good news is that these are learnable skills and mindset, while the challenge is rather to realize the need for change and engage the team to step up, trust, and recognize their already existing capability to resolve problems and make decisions in autonomy.

To help you in your self-refection, we have created a simple questionnaire at the end of this post designed to trigger some self-reflection and pinpoint some development areas. Consider your running projects and all the strategic initiatives that you need to execute until the end of the year. How many projects might be at risk due to delayed problem-solving and decision-making actions?

To conclude, today is the day when we should start addressing these skills and mindset.  An issue that has always been there and that has become critical due to the circumstances of the crisis. We all know that the travel restriction and challenges will not improve at the pre-COVID status for a long time. Thus, it is our responsibility as leaders and HR professionals to help our teams to truly step up and master the two most valuable group processes – problem-solving and decision making.

 

 

Score the following questions according your evaluation of the team dynamics and activity, take a piece of paper and make three columns A, B, and C. Tick the column best describing the way your team works.

 

  A            B            C

Is your team part of a global organization?

No   -   Yes

Do you export your product or services outside Taiwan?

No   -   Yes

Do you team rely on HQ resources to make decisions?

Never   Seldom   Often

How often do you have HQ visitors per year?

 
x<4
 
  4<x<10   x>10
Do you have strategic initiatives sensitive to delays? No   -   Yes

Do you have non-negotiable deadlines?

No   -   Yes

Do you have “western” foreigners in your team?

Yes, many   Yes, 1   No

Do the team members report to a functional line manager abroad?

No   Yes, a few   Yes, many

 

 

If you scored ≥ 5 points in the column C, then your team is likely to experience challenging times in problem-solving and decision making. We recommend observing carefully the processes and identify the steps that block the most.

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