Getting to Great: Applying Hedgehogs and FlywheelsDec 07, 2021
It's time to get from good to great!
Good to Great and the Social Sectors is highly recommended. Indeed, it should be required reading (people, it is only 35 pages!) and discussed around your senior management and board tables. And this blog is a bit longer than usual, but bear with me!
- Superior performance.
- Distinct impact.
- Lasting endurance.
Difficult to argue with that.
But how do we get there and how do we measure success?
It cannot be based on your perceptions, wishes, and dreams. It is based on evidence.
We discussed three critical concepts last week:
- The Hedgehog Concept.
- The Flywheel.
Now let’s apply them to the “for-impact” sector, our work.
To start, in our sector, mission replaces profit as the endgame. How do we accomplish our mission? (That would be the stated and written and board-approved one, not the assumed one in your mind!)
Leadership exists only if people follow when they have the freedom not to.
As we noted last week, there are five levels of leadership, with the highest development, Level 5 leaders, displaying a “powerful mixture of personal humility and indomitable will. They're incredibly ambitious, but their ambition is first and foremost for the cause, for the organization and its purpose, not themselves. They come in many personality packages, they are often self-effacing, quiet, reserved, and even shy. Every good-to-great transition begins with a leader who motivates the enterprise more with inspired standards than inspiring personality.
Understand your hedgehog!
- What is your mission?
- What are your best at?
- What drives your resource engine?
- And how do you connect them?
The hedgehog has three circles:
Circle one: passion -- understanding what your organization stands for, its core values, and why it exists, its mission or core purpose.
Circle two: best at -- understanding what your organization can uniquely contribute to the people at touches, better than any other organization on the planet.
Circle three: the resource engine -- understanding what best drives your resource engine.
The essence is to attain piercing clarity about how to produce the best long-term results, and then exercising the relentless discipline to say “no thank you” to opportunities that fail the test.
By focusing on your hedgehog concept, you build results. Those results, in turn, attract resources and commitment, which you use to build a strong organization. That strong organization then delivers even better results, which attracts greater resources and commitment, which builds a stronger organization, which enables even better results.
For a business, financial returns are a perfectly legitimate measure of performance. For a social sector organization, however, performance must be assessed relative to mission. The critical question is not “how much money do we make per dollar of invested capital” but “how effectively do we deliver on our mission and make a distinctive impact, relative to our resources”?
How do we get enough resources of all types -- not just money to pay the bills but also time, emotional commitment, hands, hearts, and minds? We need to develop a well of emotional goodwill and mindshare of potential supporters.
The economic engine in the social sector has four quadrants. Which are you?
Quadrant One is the heavily government-funded quadrant; depends heavily on political skill and maintaining public support.
Quadrant Two relies heavenly upon charitable support by private individuals; depends heavily on personal relationships and excellent fundraising.
Quadrant Three is a hybrid of those that blend charitable donations with business revenue; this requires both business acumen and fund-raising skill.
Quadrant Four captures those that rely heavily on a business revenue stream, most closely resembles that of a for-profit business.
We need to answer the question “how does focusing on what we can do best tie directly to our resource engine, and how does our resource engine directly reinforce what we can do best?"
Then we turn the flywheel: success breeds support and commitment.
The flywheel starts with attracting believers to build strength, then demonstrates results through mission success, to build your brand.
So it becomes cyclical: build strength, demonstrate results, build brand, attract believers/funders, with “rigorous clarity” about not just what to do, but equally, what not to do.
This is the power of the flywheel. Success breeds support and commitment, which breeds even greater success, which breeds more support. People like to support winners.
Anyone seeking to cut funding must contend with the brand. But of course, there is no guaranteed relationship between exceptional results and sustained access to resources. In fact, the exact opposite can happen.
Of course, you need a consistent and intelligent method of assessing your output and impact and tracking your trajectory with rigor.
Have you established a baseline? Are you improving? If not, why not? How can you improve even faster toward your goals?
But we have a few unique issues… unlike the for-profit sector…
- Our board leaders and Chief Executive Officers face a more complex and diffuse power map.
- We often have a “culture of niceness” that inhibits candor about the brutal facts of our operations and effectiveness, both board and organizational.
- We must retain faith that we can prevail to greatness in the end, while retaining the discipline to confront those brutal facts of your current reality.
- Sometimes our passion for values and mission can inhibit innovation.
- And we have fewer easy-to-measure metrics for success and progress.
Greatness is not a function of circumstance.
Greatness, it turns out, is largely a matter of conscious choice and discipline.
And somewhat easier if you read the book (it’s only 35 pages!).
What are your main “pain points” dealing with striving for greatness? What advice would be most helpful to you? And we always assume that you are asking for a friend!
Get in touch. We’ll address your questions and concerns in an upcoming blog post.
Next course starts January 3rd!!
In this one-month course, you will move from feeling reticent and tentative to competent and confident, asking good questions and making great contributions.
The course complements and reinforces your on-site orientation and opens new channels of communication and discussion. Four weeks. Eight lessons.
Next course starts February 3rd!
Our spotlight course is designed for CEOs/Executive Directors, Board Chairs and those who are interested in leadership positions on not-for-profit, for-impact boards. Six weeks. Eighteen lessons.
P.S. May I ask a tiny favour?
Would you mind sharing this blog with one person? I would love it. You can post the links in your Facebook Groups, LinkedIn or even send an email.