The company is in somewhat of an uproar. The CEO has announced a new corporate strategy and organization structure. He holds a company-wide meeting where all this is presented in some detail. His candor encourages a lot of difficult questions from the audience. A key focus area is on increasing span of control but he makes sure everybody knows what he means…we have too many managers and we will be flattening the organization...many managers will lose their jobs. He also comments that sales compensation plans are going to change. Top-line revenue doesn’t drive the right behavior; everybody needs to be paid on new business and net revenue. There are some difficult pills to swallow, some unanswered questions, but I feel like I have been given a truthful account of what I should expect in the coming months.
As a customer-facing individual contributor, I feel cautiously optimistic about my job security but I have questions like everybody else. My boss only has 4 direct reports…he could be a target for layoff or “flattening” at a minimum. It’s unclear how that might affect me. The compensation thing is really twisting my mind. A large part of my quota is renewals…customers that bought a one-year license and come back to renew year after year…is that new business? Probably not. And that net revenue thing is real interesting. I sell through major OEMs whose primary business model is to squeeze their suppliers. Relative to retail, my net revenue could look pretty bad. Will I be compared to the retail margins?
With all the questions going through my mind, an all-hands meeting is scheduled by my VP shortly after the announcements. Great! Some clarification on the way. The call is scheduled for 2 hours, so he must feel like there will be lots of questions to answer. I juggle my calendar to make the time for it. When I joined the call, there were at least 20 other people on the bridge and several in the conference room at HQ with the VP. You could cut the anticipation with a knife.
The VP opens up with a review of the numbers from the past quarter. We made up a looming shortfall in revenue right before the gong and a few key dealmakers were showered with praise for their efforts. He hands the baton to the marketing director, who reviews some successful programs implemented in the past few months and recites a long list of thank-yous to team members who were instrumental in making them happen. Next, the Canada sales director walks through a list of people that exceeded their sales objectives for the quarter. She is followed by the Latin America director, also with great numbers to report and a roster of overachievers to recognize. He is followed by the OEM sales manager (my boss) who talks about the difficult projects we implemented, also thanking a list of people that went above and beyond to make it all happen. After an hour, I get an IM from a co-worker saying, “I feel like I am at the Academy Awards…I’m expecting somebody to thank their mom!”
With minutes left in the allotted time, a quick “heads up” that the current quarter is facing a pretty big shortfall is announced. The VP will be looking for deals we can pull in and every penny we can get to make up the number. “Any questions,” he asked? The awkward silence is broken by an inconsequential question about an unimportant detail of the new organization….maybe two such questions. Perhaps the central message everybody took away was that the VP didn’t want to talk about the matters that were worrying everyone. Or maybe that we didn't have time to address the discomfiting rumors that were circulating.
Contrast the approaches of the CEO and the VP. Kudos to a few people can’t assuage the angst the whole team is feeling. It’s like the string quartet playing softly away on the Titanic while the passengers are manning the lifeboats. In times of stress and uncertainty, a leader needs to address the elephant in the room. The CEO gave out vital information and in return he received relevant concerns to address. He admitted he didn’t have all the answers but he promised to “think about” the hard ones and consult his staff for ideas. He dealt with the confusion and uncertainty directly. He coaxed unasked questions into the open. He made me feel like I was going through this with him and that what concerned me mattered to him....and I didn't even personally ask him a question!