Recently, we explained why you should hold weekly “Huddles” as opposed to traditional staff meetings and how to format those Huddles to ensure they are effective. However, a consistent format is only a small aspect of the overall Huddle framework. For a Huddle to be most effective, you must get your team into the habit of communicating in a specific way. Complete the checklist below to see if your Huddles meet these 12 communication criteria:

At our Huddles…

• Communication revolves around the Critical Numbers of the business and the stories behind those numbers.
• People leave more informed and educated on the business.
• Communication is forward looking – highlighting opportunities and emerging issues.
• People freely and candidly share failures and struggles.
• Learning is emphasized; both wins and losses provide learning opportunities.
• Contributions and successes are recognized and celebrated.
• People freely commit to helping each other.
• Communication is fast-paced and to the point.
• There is clear accountability and follow through.
• Questions are encouraged and assumptions are challenged.
• People leave with a sense of urgency to improve the score.
• People leave fired up and energized.

Developing a consistent Huddling framework is a process that will evolve and develop with your company; don’t be discouraged if you can’t check all 12 boxes off immediately. We’ll continue to provide you with tips on how to improve your Huddling process. You can also take a look at this classic Huddle video for inspiration.

The Basics

The Structure

The format for each Huddle in the Huddle Cycle should be relatively the same:

• Evaluate the game conditions
• Check the score
• Plan the next play
• Get fired up

(for a full explanation of this format read Make Staff Meetings More Effective: Stop Meeting, Start Huddling)

The Pre-Huddle provides an ideal forum to discuss the specific needs of the team, ideas for improvements and the “one thing” they can do as a team to improve the score.

• Ideas: What are your suggestions for improvement?
• Roadblocks: Where are you stuck? What can the team do to help?
• Lessons Learned: What have you learned that should be shared with everyone?

Need help envisioning what a Pre-Huddle might look like? Watch this video of the team at SRC Electrical having their Pre-Huddle. In our next post, we’ll explain Part 2 of the Huddle Cycle: The Management Huddle.

While forward forecasting is often associated with companies who practice open-book management, it can (and has) been used in workplaces that don’t share financials. The reason it is most often associated with open-book companies is because such companies typically give a high level of responsibility to the individual (or individuals) who are most closely attached to a financial number. For example take a look at these roles and the financial number they might forecast:

Sales Manager: Sales Revenue

Janitor/Maintenance: Cleaning Supplies

Scheduler: Overtime Wages

Accountant: Cash

These individuals have direct visibility to the above numbers, know the typical patterns those numbers take and could thus best predict, or forecast, where those numbers will end up based on a variety of factors.

Now that you have a better idea what forward forecasting is and why you should do it, take a look at the six key components of financial forward forecasting:

1. The actual results month-to-date.
2. The forecast: Your best assumption based on the data you have on that number. For example, as the Scheduler, you may have an actual number that includes no overtime. However, assume you’re waiting for some parts necessary to complete a big order, which will create a need for overtime at the end of the month. Your forecast would reflect that knowledge.
3. The risks and/or opportunities involved in reaching the forecast. Perhaps you have a client that is ready to sign off on a big deal, but they must first gain approval from their legal department. Though you forecast that you will close the deal by the end of the month, there is risk in that projection due to uncontrollable circumstances.
4. The actions you’ve taken to minimize the risk and maximize the opportunity. As Jack Stack explains, “Your forecast is your commitment to the organization. It’s not something you throw out and hope happens. It’s your near-term vision. If you have doubts, go communicate, talk it out and take action; that’s how you beat the conditions.” When you forecast a number, you become accountable for moving that number along. In the example above, the sales person might work directly with the client’s legal team to ensure the process runs smoothly.
5. The roadblocks that have you at a standstill with an opportunity. Two heads are better than one, right? Communicating your obstacles openly will allow others to help troubleshoot and determine alternate solutions.
6. The actions the team can take to help overcome obstacles. When everyone is aware of a potential loss or gain, they typically become willing and eager to help in order to ultimately get a win for the company.

In business, we don’t like surprises. Forward forecasting encourages employees to think about cause and effect, specifically when it comes to how they can influence your company’s numbers.

Just as sports teams regularly huddle to keep players focused on executing and winning the game, in open-book companies, teams huddle to keep each other informed about the business and focused on results.

Think about a team huddle in the final minutes of a championship game.  What do you see?  What are the coaches doing?  What are the players doing?  How can you create the same focus, accountability, alignment and sense of urgency in your company meetings? Huddles provide a consistent communication rhythm that can eliminate communication breakdowns by simply communicating through the language of business: the numbers.  Successful Huddles should include a review of the overall business outlook (the team as a whole) and the financial outlook (the score). This provides each employee the information they need to account for their actions and creates a clear understanding of where the problems and opportunities truly lie and how they can directly impact the outcome.

Here are four actions that will make a Huddle more successful:

Evaluate Game Conditions:  Begin with brief remarks from the person leading the Huddle; this will set the tone and establish a theme.  Look for a subject to give the team context and perspective; something employees can keep in mind while you go through the numbers.  This is a particular good time to share the big picture – where the company is headed, threats, opportunities, how we are progressing on our goals.

Check the Score:  Communicate the big picture financial outlook for the company and share the stories behind the numbers.  Highlight and openly discuss the wins and losses.  Encourage everyone to think about cause and effect, that is, how they can influence the numbers rather than just passively looking at results to date?

Plan the Next Play:  Determine what plays the team must successfully run to improve the score. And, make sure the players have what they need to successfully run that play.  Identify the deviations from the plan and help each other clear the path so that the team can improve on them. Employees should walk away able to answer this question:  What is single most important thing I can do this week to improve the score?

Get Fired Up:  Recognize and celebrate every win, big or small.  Highlight individual and team accomplishments.  Nothing fires up players more than being recognized and appreciated for a job well done – or a game well played.

If you stick to this simple format, your team Huddles will become the catalysts for accountability and driving performance in your company.

What better time than National Financial Literacy Month (April) to teach your employees basic business financial terms and help them understand what they mean? Use this classic training bite below (with resources attached) to help your team learn 13 basic financial terms in 15-minutes or less.

FINANCIAL LITERACY MATCH-UP

The Idea                                                

Help employees develop a strong understanding of the financials by teaching them financial terms that are key to your business.

Time Required

Play Time: 10-15 minutes

Materials Needed

Flashcards of financial terms and definitions

How it Works

Split employees into teams and give each team a set of flashcards with the financial terms and definitions. Set a timer for five-minutes and ask each team to match the financial term to the correct definition. Ask teams who finish before the time is up to raise their hands; give a few members of the management team an answer key to check each team’s work. The team who finishes first with all of the answers correct should win a “grand prize” (this can be something such as an extra 15-minute break, a food or drink item or a something with the company logo).

After prizes are awarded, take a moment to review all of the terms and discuss why they are important to the company. Consider adding other financial terms that are important to your company to increase the learning opportunity.

In an upcoming meeting, consider having a pop-quiz using the same terms where each employee matches the financial terms and definitions on their own worksheet. Repetition is the best way to help employees feel comfortable with unfamiliar financial terms.

One of the first things he does when he arrives at the airport is to convert a bunch of American dollars into the local currency, which he takes with him as he drives out to visit some of the local farmers.

When he arrives, the farmers and their families swarm around Askinosie, smiling and welcoming him into their community. They know the money he carries is for them.

But it’s not what you might think.

Askinosie is the founder of Askinosie Chocolate, a renowned small-batch chocolate manufacturer in Springfield, Missouri. And the farmers he visits supply him with the cocoa beans he uses to make the 26 metric tons of chocolate his 14-employee company sells every year. But these aren’t just suppliers to Askinosie; they’re his business partners. Through a profit-sharing program that he calls “A Stake in the Outcome,” (based on Jack Stack’s second book by the same name) Askinosie visits his suppliers to give them their cut of the business’s success.

“It’s not a life-changing amount of money like winning the lottery,” says Askinosie, who started his chocolate company in 2005 after ending a 20-year career as a criminal defense attorney, “but it is significant and appreciated. It gives the farmer something to be proud of and recognized for.”

Askinosie has long been a believer in the principles of open-book management and The Great Game of Business, all of which dates back to his friendship with Jack Stack at SRC. He first began applying the concepts of financial literacy, transparency and ownership within his law office where everyone, including the paralegals, had a Stake in the Outcome. “I remember one time when a paralegal took a call from jail from someone who wanted me to represent them,” Askinosie recalls. “And she just kept bugging me to get out of the office because she understood that a new client meant new revenue for the firm that she would share in. That’s what this is all about.”

When he opened his chocolate factory, it was an obvious transition to open the books there as well. But it was a trip to Ecuador back in 2005 when Askinosie says the idea of getting his farmers involved as well came to him. It turns out that how cocoa beans are harvested can directly influence how they taste. If they aren’t dried quickly enough, for instance, beans can become moldy and useless. Beans treated with chemicals or fertilizers don’t usually make for delicious chocolate either. So, Askinosie thought, why not create some financial incentives to help ensure his farmers shipped him the kinds of beans he needed?

He had already committed to creating a program he calls “direct trade,” in which he sources his cocoa bans directly from the farmers in the four countries he currently works with. In many cases, he wires the money directly into bank accounts he has helped them set up.

But Askinosie wanted to go further by giving farmers bonus payments based on the success of the product they helped create. He wanted to create a link where the farmers would equate better quality beans with more profits. Since he doesn’t “blend” his chocolate from different suppliers – each batch of chocolate can be tied directly back to a single source – Askinosie created a system where farmers would get a percentage of final sales of “their” chocolate.

The rub was that when he first explained what he wanted to do, the farmers couldn’t grasp the concept of profit sharing. “They had no earthly idea of what I was talking about,” says Askinosie, noting that the same could be true for many American workers as well. Despite the advice of his translators, who warned him that the farmers might not be able to understand financial information, Askinosie pushed on and walked the farmers through the calculations in their local language.

When he eventually handed over their share of the profits – in cash – everything finally came together. “They were like, ‘Oh, now I get it,’” says Askinosie. “It’s amazing how crystal clear this concept becomes once you hand someone money.”

Not only has the quality of Askinosie’s beans gone up since he implemented his Stake in the Outcome program, he’s also seen an unexpected benefit: the farmer’s incredible reaction to the samples of chocolate he gives them, something many treat more reverently than even the money they receive. In Tanzania, for instance, cocoa beans are simply a commodity: the farmers there had never even tasted chocolate before. “They are so appreciative to get to sample what they started,” says Askinosie, who has hopes that similar Stake in the Outcome models could be applied across the globe. “It’s such a cool experience.”

That said, each mistake is an opportunity – especially if the error affects a customer.

Some companies blame anyone or anything but themselves. They may or may not correct it. They may or may not apologize. Some act like they’re doing you a favor if you ask them to correct their own goof-up.

A culture of blame exists in these firms. Their mantra is “It’s not my fault.”

Other companies immediately correct mistakes – especially for customers. They apologize. They might even offer the customer something extra to show they’re serious.

A culture of accountability exists in these firms. Their mantra is “Fix the problem to the complete satisfaction of the customer.”

Clearly, the second type of company is where you want to be. But, consider kicking it up a notch to turn costly mistakes into profitable occurrences.

Let’s say Bob’s Computer Service gets a call from their customer Big Company, Inc., telling them that Bob’s driver delivered their repaired monitor but they didn’t get their power cord back.

Bob’s has a culture of accountability, so the rep apologizes, arranges to have it delivered right away and offers a discount to make up for the aggravation. So far, so good. Even though the rep did everything right, most of Bob’s competitors would do the same, so it was good, but not extraordinary.

What if Bob’s takes the time to find and fix the root cause of the error? Now they begin to separate themselves from their competitors who, as soon as the customer’s problem is resolved, get back to their hectic routine. (Hey, if you’re busy putting out fires all day, every day, it’s tough to find time to install a sprinkler system.) This is the first way to profit – by driving repeat mistakes out of your business and enjoying the resultant productivity improvements.

And here’s one more step: bring the customer back into the loop. What if someone from Bob’s contacted Big Company, Inc. and it went something like this:

“Thank you for bringing your missing power cord to our attention. As a result of this situation, we reworked our procedures. Each product that arrives for service now gets a tag on which all accessories received are documented. Nobody – including you – should ever fail to get all your accessories back with repaired equipment.”

Almost nobody does this sort of thing. This level of dedication to quality, customer service and follow-through puts Bob’s Computer Service in rare company and helps create strong, life-long customer relationships. And, we all know the value of customers who are also raving fans.

We all make mistakes. You may as well profit from yours.

==================================

Bill Collier is the St. Louis area coach for The Great Game of Business. He helps businesses improve their financial results. He is the author of “How to Succeed as a Small Business Owner … and Still Have a Life” Bill can be reached at 314-221-8558, GreatGame.com/stl or billcollier@greatgame.com. His blog is http://ggobstl.wordpress.com.

The answer? Simple. For years, the business world has been asking for two things:

1. a full-blown implementation guide…the ‘How To’ that the original book was never meant to be; and,
2. affirmation that, indeed, GGOB has and does make a huge impact in any business.

This conversation took place well over a year ago, and we’ve learned a lot since then. Random House taught us that over 10,000 new business books are published every year, 90% of which disappear after selling a few thousand copies.

But The Great Game of Business is different. It sells 10,000-15,000 copies a year, and has been doing so for 20 years. It’s been published in 11 languages and is cited in 130 other business books. This is an important book, and we had to be sure that if there were a new edition, it’d better be good.

Reluctantly, Jack agreed. The result is The Great Game of Business 20^th Anniversary Edition, which will publish in July. The new book includes dynamic new content from Jack, looking at how the OBM community has grown and evolved, and at the progress we’ve made at SRC’s living laboratory.

It’s an insight into how education, wealth and prosperity have made a real and measurable difference in so many lives. And he looks forward to what can be. It’s a celebration… and a challenge to doubters everywhere.

Then Rich Armstrong, the president of GGOB, and I spent months crafting a comprehensive implementation guide, based on your stories from the field. It’s called Get in the Game: The Interactive Guide. It’s a ‘How-To’ crafted from firsthand experiences of you… the real-life Practitioners of Open-Book Management. Frankly, it’s awesome.

All in all, there’s 30% new, additional material, plus an interactive Online Resource Site that houses the tools, templates and materials used in the Guide.

For Practitioners, it’s a refresher, a kick-starter and a chance to pay it forward to a friend or colleague that needs help. For newcomers to the Game, it’s a chance to turn things around, or take things to the next level.

For me? It’s changed my life, and made a difference in just about every life I’ve seen it touch. So I’m not going to stop until this thing hits the New York Times Bestseller List…until we reach a whole generation of business leaders that have never heard of The Great Game or Open-Book Management.

Wanna help?

-Steve Baker

If you’ve benefited from playing The Great Game of Business, why not help us spread the word by pre-ordering a copy of the book from us? Every pre-order receives exclusive bonus material not available from any retailer:

• New Audiobook, recorded in Jack’s own voice, included with every pre-order (mid-May)
• Exclusive access to the new online resource site, filled with tools, templates, videos, etc. (June)
• Free Shipping in the US, including a personalized message from you. Pay it forward to your friends, customers, colleagues (Books begin shipping week of July 16)

When a leader walks in the room, everyone else’s status goes down, everyone’s certainty goes down, everyone’s autonomy goes down. The relatedness to the leader goes down. And often fairness will go down in particular just because leaders are paid so much more money for what can look to others like less work. So what you see in general situations at work is people feeling a threat in all five domains, just due to their boss’s existence.

Rock goes on to mention that some companies are working to increase employees’ level of certainty by practicing open-book management. What Rock doesn’t detail in his explanation is how open-book management can help to increase the sense of reward in all of the domains of SCARF. Below, you’ll find a more detailed summary of all the five areas of SCARF along with some best practices in open-book management that have helped increase reward and decrease threat.

Status: Where you are in the pecking order. We prefer a clear arrangement of status. Traditionally, managers are high status; they like to feel smart.

Managers who choose to be a part of an open-book culture tend to have specific personality traits: they care about their employees, they want to “do what’s right”, and they are humble. OBM managers understand that they don’t have to have all of the answers; employees have more visibility to everyday problems and can likely provide very practical solutions.

Certainty: Ability to predict what comes next; holding multiple possible futures is cognitively exhausting. The boss often creates change and chaos with mere presence.

Having access to the books, or company financials, can help give employees a sense of certainty. However, there is a significant difference between sharing historical financials and teaching forward-looking financials. Let’s face it; you can’t change history…so looking at historical financials will not provide the same sense of certainty and security as keeping employees in the loop about where the company is going.

Autonomy: A sense of control (not prediction, as with certainty). When the boss is around, autonomy goes down, because he/she maintains the control.

Businesses, even those who aren’t open-book, are swiftly moving away from the traditional command-and-control structure and allowing employees to be more involved in everyday decisions. As Jack Stack says, “Your employees are inherently more intelligent than you give them credit for.” So why not capitalize on their intelligence and job knowledge and give them some of the control? Most open-book companies find that giving employees a sense of control will encourage them to actively look for ways to improve the business.

Relatedness: Decisions we make based on the friend or foe factor. Shared goals help create “friend” or “in” groups. Employees have a higher level of respect for those in their “in” group.

Relatedness can be tied directly to involvement and visibility. In open-book companies, managers tend to be more involved and interact more frequently with employees. Through this interaction, managers get to know employees on both a professional and personal level. The reward is created when managers use that knowledge to show interest in employees’ personal and professional development.

Fairness: An individual’s judgment of any exchange. Even a rewarding exchange can be judged as a threat if someone else is given a greater reward.

A big misconception for companies considering open-book management is that you have to share salaries. Not true. As SCARF suggests, knowing how everyone else is compensated will create animosity in the company. Best practice in open-book companies is to teach employees that the marketplace sets the wages; if the employees can help the company achieve better results, there will be more of a reward for everyone to share in the end.

So there you have it: status, certainty, autonomy, relatedness and fairness; all dynamics that can be positively affected through open-book management. Which of these five areas would improve (or already has improved) through practicing open-book management?

In it, Godin points out that until you’re actually in the thick of things, you really have no idea of what it’s like to be an entrepreneur.

Recently I’ve had the privilege of working closely with Great Game Practitioner, Hilcorp Energy. One of the things I really like about Hilcorp is that they walk the walk. They don’t just talk about making something happen, they make it happen.

Jeff Hildebrand started Hilcorp in 1989, and has grown into is one of the largest privately-held independent oil and gas companies in America. They have over 1,000 employees and 11 operating areas from the Gulf to the Rockies to Alaska’s Cook Inlet. Hilcorp is known for their innovative approach to exploration and production, as they tap resources in the wake of larger energy companies that may have otherwise been left behind.

What I love about working with Hilcorp is their incredible adhesion to their simple value set and mission. Why? Because so many organizations spend endless hours and countless dollars on vapid mission statements, vision boards and value declaration, then spend little or no energy in applying them in the field. Wonderful companies making wonderful products for wonderful customers. Inspiring, no?

To the contrary, Hilcorp states their values very simply, and backs them up with action.

Here are the Hilcorp Core Values:

Integrity – “Do the Right Thing”

Urgency – “Act Today, Not Tomorrow”

Ownership – “Work Like You Own the Company”

Alignment – “When Hilcorp Wins, We All Win”

Innovation – “Get Better Every Day”

These words aren’t just stuck on the walls, they hang on the lips of every employee I’ve met…and I’ve met a bunch in the past couple of years; easily in the hundreds.

I hear them incorporate these values in everyday conversations. “Do it today”… “Think like an owner”… “Do it right”. To see it firsthand really is inspiring.

Look, I’m a vision/values guy, because I believe in their power. That’s why I’ve been so lucky and happy to have found SRC seven years ago. Every day I get to work with people who make promises to one another…in writing. So you can imagine it takes a lot to impress me when it comes to the backbone of corporate culture. Hilcorp inspires me.

I guess it’s the lack of complexity in their value set that makes me believe that absolutely anyone can understand them and more importantly remember them in the heat of the moment…and if someone doesn’t act according to the values, it’d be impossible to claim that they didn’t understand those values.

Hilcorp has been recognized for its open-book culture, values and ethics multiple times:

#7 Top Workplaces by Fortune Magazine 2012

#1 Top Midsize Workplace by the Houston Chronicle (2x)

Best Medium-sized Workplaces in America by the Great Places to Work Institute. (4x)

Hilcorp is doubling their size and value every five years. And it’s hard to do. Every time I meet their people, I’m struck by their upbeat attitude, sincere desire to achieve and dedication to getting the job done…and getting it done right.

Mr. Hildebrand shares the wealth with those that create it in a number of ways including bonus plans and phantom stock; giving ordinary folks a chance to experience something truly extraordinary.  For example, if Hilcorp employees pull off doubling the rate, reserves and values by 2015, every employee gets a check for $100,000. The last five year game rewarded employees with $50,000 toward a new car. (I’ve ridden in one of ‘em.)

I’ve come to realize that these values can transfer directly to your personal life as well. I’ve even dropped them into my phone to look at as I travel around meeting with companies around the country.  Five simple values; five powerful ideas; seven billion dollars.

Makes you wonder…are the values you’ve chosen worth the paper they’re written on?