Necessary Endings (4 page)

“Wow,” she said. “I have never thought that causing hurt for someone could be a positive thing. That could make it
a lot
easier to execute.”

Certainly, as we went on to discuss, the goal is not to cause pain for people. But sometimes reality does just that. Reality sometimes makes us face things that hurt, and that can be a very good thing. For her, this conversation was a paradigm shifter that was going to enable her to do some

“conflict-free” pruning, a concept we wil hear more about later.

What Is the Purpose You’re Pruning Toward?

When we talk about necessary endings, it’s one thing to understand the theory behind the three reasons for pruning—good but not best, sick but not getting wel , and long since dead—but it’s another thing entirely to apply those concepts in real life. We can’t execute endings in theory only, so they have to be clear in reality. The question is, What defines reality?

When pruning a rosebush, the first step is to ask, “What does a rose look like?” In other words, you have to know the standard you are
pruning
toward.
The gardener knows what a healthy bud, branch, or bloom looks like and prunes with that standard in mind. The same thing is true in business and life—we have to have a good definition of what we want the outcome to look like and prune toward that.

For El en, the growth goal that the company had was the standard. The vision set by the CEO was crystal clear. That was why being put into her new position with his vision had so wel defined what she had to do and made the conflict come to the surface for her. It
forced
the pruning
moment
. The pruning moment is that clarity of enlightenment when we become responsible for making the decision to either own the vision or not. If we own it, we have to prune. If we don’t, we have decided to own the other vision, the one we cal ed average. It is a moment of truth that we encounter almost every day in many, many decisions. For El en, the CEO’s mandate had forced the pruning moment. She knew that if she shied away, as her initial internal conflict inclined her to do, she would fail to own the vision.

So step one for yourself or your business is naming the “rose”—in other words, defining the standard or goal you’re pruning toward. There is no one right answer, but without some clarity on what you are trying to achieve, you won’t know where to begin to bring about the necessary endings.

One of my favorite examples of this is the story of Jack Welch at GE. Welch was one of the best-known pruners in the annals of business. His approach il ustrated both the success that pruning can engender as wel as the conflict that it inherently brings to the surface.

Welch used four standards to make pruning decisions. Under his leadership, GE grew from $26 bil ion in revenues to $130 bil ion and from around $14 bil ion in market value to over $410 bil ion, making it the most valuable company in the world at the time. Here are the four standards Welch used to answer the question What are we pruning toward?

1. If a GE business could not be number one or number two in its market, it would be cut.

2. Any business that was struggling (sick) would be “fixed, closed, or sold.”

3. Every year, GE would fire the bottom 10 percent of the work force.

4. Welch would get rid of the layers of bureaucracy in the company that slowed down communication, productivity, and ideas.

These criteria paint a crystal-clear picture of what GE was pruning toward. And as you can see, it is not without the inherent conflict that pruning natural y brings to the surface. On the one side, GE’s success was undeniable. Besides the growth and valuation results mentioned above, it led to a time when twelve out of GE’s fourteen business units were leading their markets. On the other side, it earned Welch the nickname Neutron Jack, as over a hundred thousand people were laid off during his tenure. The principle of firing the bottom 10 percent had a negative image in a lot of people’s minds.

Welch’s standards il ustrate many components of pruning. Being number one or two in the market clearly demonstrates the reward of clipping some of the buds that are alive and growing
but are not the ones that will make it to the top
. Remember, I said that a bush is going to produce more buds than it can sustain, and the gardener has to decide on some basis which ones wil remain and get to draw nourishment from the stalk.

For GE, being first or second is that concept in action.
It is in complete alignment with the reality that both businesses and individuals will begin
,
gather
,
and have more activities than they can reasonably sustain.
Some of those activities may be good, but they are taking up resources that your best ones need. So you always wil have to choose between good and best. This is especial y tough for some creative people, causing them a lack of focus. They create more than they can focus on and feed, they are attached to every idea as if they were al equal, and they try to keep them al alive. Instead of a to-do list, they have a to-do
pile
. It goes nowhere fast.

Welch’s “fix, close, or sel ” standard addresses type 2 necessary endings: There wil always be sickness. Businesses and people have issues.

Our responsibility is always to “embrace the negative reality,” as I have written about before in my book
Integrity
. And the
way
we address it should also give us a good diagnosis as to whether or not a problem or a person can be fixed. We wil see that in the diagnostic sections later in the book, but the point now is that
we should not be dealing with negative realities in the same old way
,
over and over again
. At some moment, we have to determine whether or not our efforts to make a business succeed or to make a person improve are going to work. To do the same thing over and over again expecting different results is not only crazy, it is a recipe for staying stuck and not getting the rose you want.

Your attempts to fix should also include a realistic assessment of the potential for recovery and whether or not you are indulging in false hope.

Leaders by nature are often optimistic and hopeful, but if you do not have some criteria by which you distinguish legitimate optimism from false hope, you wil not get the benefits of pruning.
Sometimes
,
the best thing a leader or anyone else can do is to give up hope in what they are
currently trying.
As we read in Ecclesiastes, there is a time to give up. Wise people know when to quit. Winners don’t throw good money after bad.

Or as the song says, they “know when to hold ’em, know when to fold ’em.” Welch’s phrase to “fix, close, or sel ” clearly implies that there wil be diagnostic criteria that wil force a pruning moment. Some people have a mantra of “fix, fix, or fix,” but they never do because that branch or bud or person is just not going to be fixed, period. It’s time to move on.

The “fire the bottom 10 percent” mantra is a clear pruning idea that encompasses al three categories—good but not best, sick and not getting wel , and long since dead. I am sure that in GE’s bottom 10 percent there were some good ones, some not-getting-wel ones, and some who were just not producing at al , the deadwood. And I can understand why many people were upset with a fixed strategy like that for firing employees. But I do believe that there is
some number
of people in every organization and every life who wil be routinely “let go” if leadership is doing its stewardship job. The very nature of people is that there are some good ones who are not right for you, some sick ones in denial who are not going to change, and some who are adding nothing.
Always.
So if no one ever leaves your organization or your life, then you are in some sort of denial and enabling some real y sick stuff al over the place. And it probably is accumulating. I have found this to be rampant in companies that have a high

“people value.” The value is good, but sometimes it keeps them from doing what is truly valuing to people.

So, was Welch real y a Neutron? I wil leave that for you to decide. My point is not that you have to have a strategy of firing a certain number or percentage; my point is that if you are truly leading, you
will
be firing
some
percentage
.
It is almost a truism. If you are not firing someone at some time, something is probably wrong.

Welch’s intolerance of bureaucracy il ustrates wel the pruning concept that there are some branches that are just in the way. They are not adding anything, and they are definitely in the way of the growth of the other buds. In Welch’s thinking, the bureaucratic layers kept the bright ideas and practices of workers from growing and being implemented into the structure of the company. Welch got the branches out of the way, and the growth propel ed the company upward.

Good but not best, sick and not getting wel , and deadwood taking up space. Al three can be seen in these mantras that have been heralded to account in large part for the growth that GE experienced.

In this story, both the success and the conflict of pruning are so apparent. Pruning is not easy. It is hard and there wil be people who don’t like it, no matter what you do. You have to decide where your lines are, the values with which you wil execute them, and go forward. Whether or not you prune in the Welch way is not the point, as his way doesn’t fit al businesses or lives. The point is that no matter what your goals, vision, values, and metrics may be, they wil force you to the pruning moment when you use them as the standards to evaluate situations and people.

Not every activity nor every person is a rose or wil ever be one. One might be a great chrysanthemum, but remember, you are growing a rose of a business or life. So you have to begin by defining what you are pruning toward and the criteria by which you wil keep or clip. We wil spend time later helping you diagnose when to keep, fix, or clip, but for now what I want to emphasize is that step one has to be figuring out who you are and who you want to be. Two questions apply: How wil you define success? and How wil you measure it?

You can’t prune toward anything if you don’t know what you want. You have to figure out what you are trying to be or build and then define what the pruning standards are going to be. That definition and those standards wil bring you to the pruning moments, wherein you either own the vision or you don’t.

I recently had a coaching project with a venture capital group in the process of selecting an executive team for a new business launch. With the CEO now in place, they were evaluating candidates for the rest of his senior team. Using a five-point rating scale, with five being the best, I spent the day with them as they reviewed candidates. There were some very good people, but when I stepped back a bit, I noticed something peculiar.

The individual candidates’ performances were rated as mostly threes and sometimes fours. Because they were rating them individual y, they were missing the bigger picture. I told them that if they chose al of these people, they would ensure that the new company would have level 3 returns. Is that the kind of returns they had promised their venture fund? Probably not. The conversation turned at that point to getting a better definition of what a rose was and how to measure it.

“If you don’t know where you are heading, you’l get there” applies to pruning as wel . Define what you are shooting for, and then prune against that standard. That is when vision, goals, and even teams begin to take the shape that you desire.

More Than Cutting Expenses

Sometimes people equate the concept of pruning with cutting expenses or “reducing head count.” They say things like, “You’re right. We have got some fat around here and need to cut some costs.” But cutting costs is not what pruning is about, and when someone says that, they are thinking more like a manager than a leader.

Certainly, routine expense reviews and cuts are good pruning practices, always. They should be done, and we should consistently ask ourselves,
Do we really need to be spending that?
(And have you noticed that many times after expense cuts the businesses are doing just as wel ?) That’s a good pruning exercise, but it misses the bigger picture.

The kind of pruning I’m talking about has to do with
focus
,
mission
,
purpose
,
structure
,
and strategic execution.
A mere expense cut might have enabled GE to keep al of the two hundred or so businesses it got rid of, if it had just fol owed a mantra to cut al expenses by 10 percent. As a result, the “average roses” would have then become even less than average, and we would not stil be talking about GE’s accomplishments. So what we are talking about here is not just “cutting fat,” as the phrase goes. We are talking about defining what the bush is going to look like and pruning everything that is keeping it from realizing that vision—be it good, bad, or dead. And that vision could be business or personal in nature.

In many businesses and in many people’s lives, there is little definition like that. They continue to be involved in activities and with people needing al three types of pruning. And this is why mere cost cutting wil not get you what you want. Just continuing to do the same activities but doing them

“less resourced” wil give you less of what you were already not happy with! Not too smart: “We have lackluster results, so we wil cut resources in the same areas of focus to get better results.” Real y?

In your business and in your life, don’t just “cut back” and think that you have pruned.
Pruning is strategic
. It is directional and forward-looking. It is intentional toward a vision, desires, and objectives that have been clearly defined and are measurable. If you have that, you know what a rose is, and pruning wil help you get one of true beauty.

Subcategory Pruning

Pruning not only applies to the big picture, such as pruning toward a vision; it also applies to smal er categories of activities, in the little branches of life and business as wel . I refer to this as subcategory pruning or micropruning. For example, let’s look at how micropruning could be applied to a weekly meeting of an executive team, department, or project team. These meetings are about routine matters—you aren’t firing anyone, eliminating business units, or reinventing key strategies—but the team might stil benefit by taking some time to ask itself questions in the three pruning categories: