Sunday, May 31, 2015

When "the problem" is NOT the problem

Throughout the years I have noticed that when churches find stagnant or declining revenue (giving from members) the collective heads of leadership decide the pastor needs to do a sermon series on giving, there needs to be a Fall stewardship campaign where people commit to give some amount the next year, the bulletin has budget updates, and so forth. Generally, leaders fail to recognize that congregational giving is not "the problem." unsatisfactory revenue is a symptom of a problem, not THE PROBLEM. Trying to generate more revenue without addressing the congregation's (customer and consumer) relationship with the church's product is at best temporarily helpful. The problem is the congregation's sense of commitment to who and what the church is and the appeal the church's product has to them. Unless these are addressed, the church will continue to stagnate and die.

Such it is with commercial organizations. many executive leadership teams claim that sales or margins are "the problem." However. these are just metrics showing evidence of the quality of the relationship the company's customers and consumers have with the company's products.
Failing to satisfy these psychological factors within their customers and consumers is THE PROBLEM. Sales are the result of the quantity purchased and price paid by customers given the relationship they have based on these factors. Gross margins across time are the way customers respond to the array of product offerings and the value they see in each product. Net margins are the degree that the company's costs are producing better gross margins or sales or not.

When leaders of organizations focus on metrics as the problem, then they are not focusing on solutions to the problems. Look around your organization. See how often management says that that budget is a problem, or sales is the problem, or we must fix our margins, when the reality is that the company needs to improve the way they fit in with the world around them. Metrics are good to point out what is happening across time with the practices of the company and exogenous forces, such as competition, regulation, demographic trends, economic trends, etc.However, metrics are never the problem and only point to the problem. Metrics are symptoms. Nassim Taleb suggests that "the misuse of metrics is a psychological disorder."

When you go to the doctor and he/she weighs you, takes your blood pressure and your temperature. If any of these are worse than expected, the doctor does not say your weight is a problem or your blood pressure or temp is a problem (or they should not if they are good doctors). They say your weight points to poor eating or exercise or you temp suggests you have an infection. While we sometime treat symptoms, you only get well when the problem is solved.

Winning across time requires leaders to be strategic. This involves many things but especially it involves solving problems and not symptoms. Executive leaders can follow all the prescriptions for providing clarity and inspiration to their organization, but if they do not solve the strategic problems, they will not win.

You can read more @ http://www.amazon.com/Winning-hostile-environment-Steve-Caldwell-ebook/dp/B00M7A2J78/ref=sr_1_3?ie=UTF8&qid=1433115959&sr=8-3&keywords=winning+caldwell

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