Great Ideas! Brad Hams' Ownership Thinking

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An overview of Brad Hams' recent and excellent Ownership Thinking, a book that picks up and expands upon the key concepts in Jack Stack's still-invaluable The Great Game of Business.

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  • Introduce the book, Collins, L&L concept\n\nVALIDATION - clients and OSB\n
  • Collins as guru:\n\nCome to Boulder, RH framework, Growth Summit keynote\n
  • Collins as guru:\n\nCome to Boulder, RH framework, Growth Summit keynote\n
  • Explain “prequel” idea\n\nCorporate genome project -- mapping “great” organizational DNA\n
  • Explain “prequel” idea\n\nCorporate genome project -- mapping “great” organizational DNA\n
  • Not about these companies? Not about business?!?\n\n1 thing: the timeless principals of G2G\n
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  • Not about these companies? Not about business?!?\n\n1 thing: the timeless principals of G2G\n
  • Introduce the book, Collins, L&L concept\n\nVALIDATION - clients and OSB\n
  • Great Ideas! Brad Hams' Ownership Thinking

    1. 1. Great ideas!Ownership Thinking:How to End Entitlement and Create aCulture of Accountability, Purpose and Profitby Brad HamsThe Executive ForumFebruary 7, 2012
    2. 2. Brad Hams has takenJack Stack’s Great Game of Business vision, reinforced it and made it more tools based
    3. 3. Brad Hams has taken Jack Stack’s Great Game of Business vision, reinforced it and made it more tools based“A systematic and practical process for getting youremployees to give that extra effort and brain power that we know they possess.”Verne Harnish, author of Mastering the Rockefeller Habits
    4. 4. Like The Great Game of Business, this is a book written from the trenches
    5. 5. Like The Great Game of Business, this is a book written from the trenches... and now claims more than 1,000 client companies
    6. 6. Hams has an interesting back story
    7. 7. Hams has an interesting back story Left home in Scottsdale, AZ at 17 Hitchhiked to Berkley and put himself through school A voracious reader and lifelong learner Ran a company in Mexico at a young age Developed Ownership Thinking there Started his consulting firm in 1995
    8. 8. Quick overview
    9. 9. Why Ownership Thinking is Desperately Needed
    10. 10. “I am a big fan of wealth, because wealth creates opportunities.”
    11. 11. But Ownership Thinking is also about creating extraordinary organizational cultures
    12. 12. Where employees learn the business of business and participate actively
    13. 13. Remind you of anybody ... or anything?
    14. 14. How to Create Incentive Plans ... That Work!
    15. 15. This gets into the nuts and bolts of a great plan ... including why and how to make it self-funded
    16. 16. Your Employees Think You Make Wheelbarrows of Money
    17. 17. Why is educating your employees so important?
    18. 18. Because what they don’tknow can hurt the company There can be feelings ofresentment or morale issues
    19. 19. Measure Through the Windshield
    20. 20. ... not the rearview mirrorMeasure Through the Windshield
    21. 21. A focus on KPIs Operational and Financial Leading and Lagging Indicators
    22. 22. Get RIP’d: Rapid Improvement Plans
    23. 23. “The Objective of a RIP is to attack and improve one KPI at a time ...
    24. 24. ... with a high involvement, detailed plan.”
    25. 25. Ownership Thinking for the Long Term
    26. 26. With a focus on getting started
    27. 27. With a focus on getting started And sustaining your success
    28. 28. Now for the deep dive
    29. 29. Why Ownership Thinking is Desperately Needed
    30. 30. How owners and employees think
    31. 31. Owners think ...
    32. 32. Profit
    33. 33. ProfitCash flow
    34. 34. ProfitCash flow Risk
    35. 35. Profit Cash flow RiskCompetition
    36. 36. Profit Cash flow RiskCompetition Employees
    37. 37. Profit Cash flow RiskCompetition EmployeesCost control
    38. 38. Employees think ...
    39. 39. My paycheck
    40. 40. My paycheckHealthcare/Benefits
    41. 41. My paycheck Healthcare/BenefitsGetting my work done
    42. 42. My paycheck Healthcare/BenefitsGetting my work done Job Security
    43. 43. My paycheck Healthcare/BenefitsGetting my work done Job Security Recognition
    44. 44. My paycheck Healthcare/BenefitsGetting my work done Job Security Recognition Time off
    45. 45. My paycheck Healthcare/BenefitsGetting my work done Job Security Recognition Time offThe work environment
    46. 46. My paycheck Healthcare/BenefitsGetting my work done Job Security Recognition Time offThe work environment Opportunities
    47. 47. Overcoming the disconnect
    48. 48. Hams goes on a bit of a political jag about entitlement, earning,misdirected altruism and self-esteem
    49. 49. Which I’ll leave you tocontemplate from the comfort of your favorite armchair
    50. 50. “We must remember that ... the people with the greatest understanding andexpertise in any given area are the people actually doing the work”
    51. 51. Characteristics of great companies
    52. 52. They care deeply
    53. 53. They care deeply They have fun
    54. 54. They care deeply They have funThey have very high expectations of performance
    55. 55. Creating an organization of excellence, rather than having pockets of excellence
    56. 56. How to Create Incentive Plans ... That Work!
    57. 57. Incentive plans must be self-funding
    58. 58. Incentive plans must be self-funding
    59. 59. The Ownership Thinking model is: Right people Right education Right measures Right incentives
    60. 60. But I prefer:
    61. 61. Teach people how the company makes money
    62. 62. Show them how they (can) impact the company’s performance
    63. 63. Create incentives that improve performance
    64. 64. You need to provide:The education, measures, information and tools to help people find the money to fund the plan
    65. 65. “The incentive plan is meant to improve thefinancial performance of the company and shape employee behavior accordingly”
    66. 66. Elements of a poorly-designed incentive plan
    67. 67. Elements of a well-designed incentive plan
    68. 68. Designing your plan
    69. 69. Focus on one (ideally) or two key measures
    70. 70. Focus on one (ideally) or two key measures Profit Before Tax
    71. 71. Focus on one (ideally) or two key measures Profit Before Tax Cash Flow
    72. 72. The ten questions you should answer before designing your incentive plan
    73. 73. Your Employees Think You Make Wheelbarrows of Money
    74. 74. People typically vastly overestimate the company’s profit
    75. 75. Instead
    76. 76. Instead Most people are shocked at the cost of doing business
    77. 77. Your baseline for teaching basic financial literacyThe Income Statement - Cash Flow Statement - The Balance Sheet
    78. 78. Measure Through the Windshield
    79. 79. How to identify your KPIs
    80. 80. A five-year financial analysis: aimed at identifying trends
    81. 81. An employee survey:to highlight high-priority issues
    82. 82. Then determine what you will measure and report
    83. 83. Ask: what really drives our performance?“Focus on and measure the most critical activities that will accomplish this.”
    84. 84. Remember: Revenue, Gross Margin and Cash Flow are lagging indicators
    85. 85. Remember: Revenue, Gross Margin and Cash Flow are lagging indicators What drives them?
    86. 86. The KPI workshop
    87. 87. Start with a laundry list Whittle the list down to a manageable number of key items Have both leading and lagging indicators Determine who is accountable for each KPICreate a scoreboard (for forecasting)
    88. 88. Utilizing the scoreboard
    89. 89. Show: Month Month Month YTDKPI Owner Budget Forecast Actual Budget I IIIII
    90. 90. Use the scoreboard for forecasting, not problem solving And to create visibility and accountability (hmmm)
    91. 91. Huddles drive the conversation At least twice per month
    92. 92. Get RIP’d: Rapid Improvement Plans Improving, one KPI at a time
    93. 93. Steps to creating a RIP
    94. 94. The beauty of RIPs
    95. 95. Identify process improvementsCreate financial improvement in a short period of time Fund the incentive plan Create new standards in the business Real team building
    96. 96. “Rapid Improvement Plans are one of the most critical and influential components of Ownership Thinking”
    97. 97. The keysto creating great RIPs
    98. 98. Ownership Keep ‘em simpleDocument them/Make them formal Bring ‘em to life Report throughout Celebrate wins!
    99. 99. Get non-management involved in designing RIPs And always have at least one underway
    100. 100. Ownership Thinking for the Long Term
    101. 101. The key ingredients for sustained success
    102. 102. Discuss with your leadership team first
    103. 103. Then take it to everyone
    104. 104. Do the company survey
    105. 105. Do the financial analysis
    106. 106. The KPI workshop
    107. 107. Design the incentive plan
    108. 108. Kick off the program!
    109. 109. The super short Cliff Notes
    110. 110. Teach people how the company makes money
    111. 111. Show them how they (can) impact the company’s performance
    112. 112. Create incentives that improve performance
    113. 113. I’ll give the final word to Brad Hams
    114. 114. I’ll give the final word to Brad Hams It takes two things to create success: A great tool and the commitment to use it
    115. 115. Great ideas!Ownership Thinking:How to End Entitlement and Create aCulture of Accountability, Purpose and Profitby Brad HamsThe Executive ForumFebruary 7, 2012

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