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Transitioning to General Management

November 20, 2015 • Editors' Pick, LEADERSHIP, Leadership Development, MBAs & Executive Education

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By Kevin Kaiser, Michael Pich and IJ Schecter

Being successful in your industry does not necessarily guarantee success in your new capacity as general manager. Whatever your background or route to the top, there are certain tools that should assist you on your journey to becoming a successful general manager.

 

“You are being promoted to a general management role – congratulations!” With those words, shivers of excitement as well as trepidation run down your spine. You are about to face an entirely new set of challenges which will demand skills and competencies which were not needed up to this point in your career. Even worse, many of the skills that helped you to achieve success in your career thus far will now become your biggest weaknesses. You realise that to deliver your new mandate, you must change. But how?

For our recently released book, Becoming a Top Manager: Tools and Lessons in Transitioning to General Management, we decided one way to answer this question would be to pose it to past participants in our INSEAD executive education program, Transition to General Management, who had already made this transition. These people represented a broad mix from different backgrounds, industries, companies and geographies with one thing in common: they are somewhere on the new learning curve of what it means, and what it takes, to become a successful general manager.

We were delighted both by the enthusiastic response from so many willing participants, who took time out of their jobs and lives to watch scripted videos and provide comments, and by the depth and diversity of the insights and reflections they offered. These insights and reflections not only provided great context for the book, they also allowed us to identify ten key success factors that we think will help guide others in making a similar transition from functional to general management.

Being an effective general manager requires the same thing today as it will require tomorrow: the willingness to lead, the openness to learn, and the unwavering commitment to value creation. It also requires an ability to generate trust and build a perception of fairness, as well as an ability to look beyond simplistic, narrowly-defined, short-term indicators and understand the impact of behaviours and decisions across a broad perspective and into the long-term. This ‘big picture’ view is difficult to explain and nearly impossible to measure, but there are key success factors that we feel will help any general manager with the transitions required in the way they manage the business, manage others, and manage themselves.

 

Key Success Factors for Transitioning to General Management

1. Questions are much more important than answers

Successful functional managers often attribute their success to the knowledge and experience they have gained in their functional role. Having become accustomed to having the answers to sometimes quite difficult questions, many have great difficulty in transitioning to a role that relies more on questions than answers. It is simply not possible for a general manager to know all the answers. Moreover, the surest way to prevent your people from asking the right questions and contributing to the ongoing adaptation and problem-solving of your organisation is to start telling them what to do, and what success will look like, instead of asking how you can help them. Find a way to be confident and persuasive without having to have answers. This is a ‘process’ approach to management, rather than a ‘knowledge’ approach to management. (Applies equally to Managing Self, Others and Business)

2. Trust is the key to all effective communication and management

When people look ‘up’ within the organisation they see ‘the boss’ who could over-rule them, embarrass them, or fire them. For this reason, their natural reaction to any person above them in the hierarchy is a combination of admiration (hopefully) and fear (unfortunately). As a general manager, you may sometimes have to make decisions that may not be seen as in the best interest of a specific functional area. In order to ensure that everyone continues to speak openly and honestly to you, you need to demonstrate fairness, openness, and sincere respect. Their honest input and feedback is the key to your success in your general management role, but if they don’t trust you to react fairly and constructively, they will quickly stop providing it. Be aware, this trust may take years to earn but it can be lost in an instant. (Applies most directly to Managing Others)

3. Beware of your expertise – it may no longer be a strength

As one moves up to a role in general management, one must be able to see and prioritise ALL areas of the business, but our tendency to stay in our ‘comfort zone’ may inhibit or even prevent one from being capable of doing this quickly and correctly. There is evidence that ‘experts’ possess more bias in their areas of expertise than non-experts, which actually makes them less able to pick up new trends, see different perspectives, or anticipate different future paths. This effect is further exacerbated by the tendencies of those ‘below’ in the hierarchy to ‘agree’ with those above, which further enhances the misplaced confidence in mistaken assumptions and opinions by those who’ve moved up the hierarchy.

Be extremely careful to not allow your expertise to make you biased, closed-minded, and over-confident, rather than open-minded, data-driven, and learning-oriented, as you transition to a role in general management.

For all of these, and other, reasons, be extremely careful to not allow your expertise to make you biased, closed-minded, and over-confident, rather than open-minded, data-driven, and learning-oriented, as you transition to a role in general management. (Applies most directly to Managing Yourself)

4. Value is not Earnings, nor is it Market Share, nor is it Share Price, nor is it …

As one moves to a role in general management, one must be sure to expand their scope in two key dimensions: (1) From the short-term to the long-term; and (2) from the single area of responsibility to the broader impact on the entire organisation. Resist the temptation to over-simplify the job by choosing to define success by narrowly-defined, short-term performance indicators and instead maintain his/her integrity and focus on the long-term, organisation-wide impact of management decisions. Let’s face it, if you aren’t doing this, how can you expect the subordinates to do so when they receive targets on narrowly-defined, short-term indicators? (Applies most directly to Managing the Business)

5. Business is about serving customers to drive long-term survival

The GM must never forget that every decision in business must be oriented around serving customers, and doing so in a way that the organisation makes the money necessary to support its continued health. As competitors seek to achieve the same, survival depends upon having a sustainable competitive advantage in the ability to serve customers and make money in the process. Any time a discussion around a decision isn’t explicitly, as well as implicitly, focused on addressing this customer-driven, efficiency-oriented perspective on how to build and sustain competitive advantage, then the GM must re-frame the problem and get the discussion back on the right track. (Applies most directly to Managing the Business)

6. Be aware of, and mitigate the role of bias in decision-making

It is well known that the human brain tends to follow mental processes that make use of ‘shortcuts’ that result in predictable and systematic ‘biases’ in the way we select data, make decisions, and learn from our past. Be conscious of these biases and be vigilant in mitigating their impact, for example by forming diverse teams, collecting broad data sets, making use of ‘reframing’ of questions to check whether the answers are influenced by the framing of the question, and assigning and rotating the role of ‘devil’s advocate’, among other techniques. (Applies most directly to Managing Yourself)

7. Morale is everything – Business is about making money, but that doesn’t mean it can’t be fun

If your people are not excited, motivated and determined to come to work then you are not succeeding as a general manager.

If your people are not excited, motivated and determined to come to work and continue to learn and adapt and drive decisions and actions which continuously re-establish the business’s competitive advantage and use it to create and capture value, then you are not succeeding as a general manager. Continuously assess whether and how your management processes are demotivating individual members of your team and search for solutions to maintain high morale. The perception of fairness is fundamental to morale – be sure they see regular evidence of fairness in your processes. And remember, in spite of the pressures of business, people like to have fun – be creative in building opportunities for fun into your organisation. (Applies most directly to Managing Others)

8. Success depends upon teamwork

We work in teams in order to accomplish tasks which one person alone cannot achieve. To achieve high-performance, the team must have trust (in competence and integrity) across the parties, a shared respect for the different roles, a common objective (value creation for the organisation into the long term), and regular and high-quality communication, among other attributes. The general manager must be ever-vigilant to ensure these elements remain in place and are continuously reinforced and are perceived as being present to all. (Applies most directly to Managing Others)

9. Trust, Learning and Fairness – the Pillars of Managing for Value

The challenge of business, to deliver customer value more successfully than the competition while doing so more efficiently with fewer resources than the competition, is unrelenting. As the solutions will be elusive and changing continuously, success will require all team members have a mindset and culture of continuous learning and adaptation, and a willingness to work in a collaborative, open way. This culture will only exist if all members of the organisation perceive a high level of fairness, and have trust in others and in the decision-making processes. Always be on the lookout for opportunities to reinforce these pillars as well as watching for behaviours which undermine these pillars which need to be ‘nipped in the bud’ before they create negative spirals from which recovery is extremely difficult and expensive. (Applies most directly to Managing Others and the Business)

10. Sports teams have ‘practice’ and ‘game time’ – Business is perpetual ‘game time’. Build in practice time

We learn through failure combined with a conscious effort to reflect on why a technique or process lead to failure, so we can modify the process or adopt new techniques to improve performance. Musicians, athletes, and others recognised for displaying extremely high levels of performance in a particular area, all go through a similar learning process: practice, feedback, reflection and coaching. The GM who can build a culture of such continuous learning through ‘small-scale’ and rapid experimentation into the day-to-day management of the business will be rewarded with a motivated and money-making organisation. (Applies most directly to Managing Others)

 

Managing the Business, Managing Others, and Managing Yourself

Of the three areas, managing the business, others and yourself, the major challenge in successfully transitioning to a role in general management will concern the third area. Managing yourself delves into the difficult personal awareness needed to be a fully performing general manager. The only thing that matters now is the ability to learn how to learn – constantly, and without allowing opinion, personal agendas, or political manoeuvring to compromise sound, value-based decision-making and effective management of those around you.

To become truly successful leaders, the general manager must embrace, and exploit, their own individual journey, which will in turn allow them to complete the transformation into true creators of value for their organisations.

To become truly successful leaders, the general manager must embrace, and exploit, their own individual journey, which will in turn allow them to complete the transformation into true creators of value for their organisations. Your personal and professional transition will look different from anyone else’s. You have your own personality, your own background, your own biases, your own skill set, your own hot buttons and blind spots. Therefore, it isn’t possible to prescribe any one formula for success. Rather, it is important to emphasise the change you must undergo to step effectively into this new role. It is not an overnight transition; it takes time, effort, and willingness. The path you are on does not take place in a vacuum. We encourage you to leverage those around you, seek guidance from those who have experience and those you trust, and open yourself up to as much learning and skill-building as you can.

 

About the Authors

1Kevin Kaiser is currently Professor of Management Practice and Director of the Transition to General Management program. Kevin is also Director of the ABN Amro Managing for Value Research Fund at INSEAD, which supported the research in this article. Kevin holds a PhD in Finance from the Kellogg Graduate School of Management at Northwestern University.

2Professor Michael Pich is Dean of Executive Education at INSEAD. Prior to his appointment as Dean, he was a Senior Affiliate Professor in Operations Management, and Entrepreneurship and Family Enterprise. He received his PhD in Operations Research from the School of Engineering at Stanford University. He has been a program director for several executive education programs at INSEAD, addressing the needs of executives transitioning from a functional to a general management position, in addition to numerous company-specific programmes targeting the leadership pipeline for leading global and local businesses.

3IJ Schecter is a bestselling, internationally published author who writes frequently on business strategy, management and leadership. He is also founder and CEO of The Schecter Group, a global leader in communications strategy and implementation.

 

 

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