New CEO pays a visit

I often avoid writing about my work at Sage to ensure I have the freedom to speak my mind on this blog. Serendipity invites me to try a different approach this week. Pascal Houllion from France; our recently appointed CEO of Sage North America came to visit our office in Richmond. His visit coincided with my first cultural intelligence class in my MBA program. I was fascinated that almost everyone I spoke to who met him used the words “different culture” when sharing their perceptions of Pascal’s comments and interactions with him.

For example,  he appears to have strong views on the work environment. I have seen pictures of the Sage offices in Dublin and Paris. It seems to me the offices are designed to foster collaboration and an egalitarian environment. Both are very open, with low cube walls while very few managers have offices. Introducing similar changes in North America would definitely shake things up if implemented. Office size and location are considered by many as a sign of greater rank and influence in the company while employees typically prefer higher cube walls for privacy to work uninterrupted.

In meetings I was told Pascal was  a “straight shooter”, willing to share his first instincts on the issue at hand with whatever information was available to him. I find this approach refreshing.  This style has its risks though from a cultural perspective. Last year I blogged that the perception of what our CTO had requested often appeared different from what he intended when I had the opportunity to ask him questions directly. It took me several years to adjust to the communication style in North America. My experience is that open dialogue is typically reserved for smaller group meetings and that hierarchy is taken much more seriously in North America than Ireland. Discussions with, or opinions expressed by senior executives are sometimes interpreted as decisions by employees. This can have significant consequences in terms of morale and productivity if a decision is questionable. (Even though many times a decision was not made!)

One other very positive perception that emerged was  that management experience and qualitative feedback will play an increasing role in decisions going forward. This works well for me! Data is important, a key tool in a manager’s toolbox for sure. An excellent book “Made to stick” makes the point that we need much more than data to deliver a message that resonates and inspires a team to action though. We need a compelling message that is easily understood to make the idea sticky with the target audience.

Many who met Pascal got the sense that big changes are in store for our business over the next few years. I sincerely hope so. This comment could easily be interpreted as a criticism of the local leadership. It is not. Sage North America has made huge progress in the past few years. Finally, some tough decisions have been taken from a portfolio perspective in the mid-market business division.  Indeed at the 2010 Sage Insights conference the executive team themselves acknowledged that our investment in R&D had probably been spread across too many products in key-note presentations. I once read our plethora of product offerings described as similar to a ransom note by a former leader in the company to an industry analyst!  My point is simply that many times it takes someone outside of the organization to highlight dysfunctional aspects of a culture or emotional attachments to a product line and position to do something about them. Laurie Schultz, our General Manager has proven she had the courage to make the tough decisions in Sage’s mid-market portfolio. We need a similar approach and new growth strategy for our entire business that customers, employees, partners and shareholders can buy into.

I read an interesting post from Wayne Schultz recently about our latest re-org in Sage North America. Wayne made a good point that it typically takes a year or so for a new leader to ramp up on the business. He wrote “Maybe Pascal will jump right in and begin leading without any need to study the North America operations – but I wouldn’t bet on it.” I will go out on a limb and place a different bet. He will! Everyone I spoke to in Richmond is very impressed with our new CEO’s knowledge of the SMB market. I am confident Pascal will exceed Wayne’s expectations!

I would be delighted if Pascal can exceed employee’s expectations as well. Sage’s ability to deliver an Extraordinary Customer Experience requires a highly motivated and engaged workforce. An interesting article in Business Week discussed a study of 61,000 employees by the Corporate Leadership Council. The data showed that one out of four employees was disengaged.  One of the main causes of this disengagement is directly linked to the massive change employees have experienced when it comes to their Employment Value Proposition (EVP)—or the value that employees gain by working for a particular organization. EVP has trended downwards across the western world due to reasons such as layoffs, organizational restructurings, and shifts in managers. An interesting and scary thought from the article was “the reality is that the anticipation of future organizational change is more detrimental to EVP than the change they have already gone through“. Sacré bleu!  Here we go again but change we must! Our future depends on it.

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