PEOPLE ASSESSMENT THE SEVEN KEY AREAS

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1 PEOPLE ASSESSMENT THE SEVEN KEY AREAS Your employees are one of your most important assets and are critical to achieving success in your business. The People Assessment module aims to demonstrate how you can make the most of your employees skills, talent and loyalty, so that they can help you and your business achieve its ultimate goals. The People Assessment module consists of the seven areas: 1. Strategy and planning 2. Effective leadership 3. Culture and positive employee relationships 4. Employee development 5. Creating the road maps for your employees success 6. Ethics, conduct and standards 7. Effective management 1. Strategy and planning There are many levels of strategy and planning involved in running a successful business and in this section we will look at organisational strategy. Other high level key elements of successful strategy and planning are included in our Business Planning module. Organisational strategy, however, focuses more specifically on establishing the operational and employee performance standards required to achieve your strategic objective. An organisation chart acts as a useful tool in creating a picture of your business that will serve its future needs. This picture can then be used as a blueprint for building your internal business systems and processes. The advantage of this approach is that positions are designed to serve your strategic objective and needs of the business, and people are employed to fill those positions, not the other way around. The organisational chart design process as follows: 1. Document each strategic position Tied to business vision 2. Document each business area Advice, Services 3. Identify accountable persons Manages results 4. Identify responsible persons Delivers results 5. Document expected results Impact of results Financial advisers only

2 POTENTIAL PROBLEMS YOU MIGHT FACE IN YOUR BUSINESS 2. Effective leadership For your business to be successful, it s essential that you, as the leader, are working as effectively as possible. By applying fresh thinking to how you lead your business, understanding potential problems you could face, and understanding what makes you successful in your role, you will be able to lead from the front. a) Apply fresh thinking to how you lead your business To become an effective leader, it s important to apply a fresh way of thinking to your business, your life and the inter-relationship between the two. Three interesting points to note: 1. Small businesses often fail simply because their owners don t understand the basic rules of running or building a business. Instead they focus on how to make a product or provide a service. 2. Building a successful business requires a business owner to take a short, medium and long term strategic view of their business, plus an integrated view of the business as a whole, both as it exists today and in the future. This is referred to as double-vision ; keeping an eye on today, and tomorrow. 3. Adopting the five key principles in section 2b) will guide you towards achieving a new level of success and happiness in both your business and your life. b) Typical problems faced by small businesses Small businesses worldwide have similar problems. Have a look at the Potential problems you might face checklist and tick those that apply to you. Note that small business problems are based on real businesses who have all joined the E-Myth Worldwide Program. The solutions to these commonly experienced problems are found in the five key principles below. The five key principles of a successful business: 1. Create a business that will give you what you want out of life. It s more than just a job. 2. View your business objectively as separate from you, not as an extension of yourself or your life. 3. Work ON your business not IN it; this means creating a business that runs independently of you. 4. View your business as an integrated system. The system does the work, and people run the system. 5. Practice management is key to building a business that works - it is the continuous development of the business. Small businesses fail at a discouraging rate: 57% fail in their first year; 80% are gone after five years Most small business owners work too hard and receive too little reward Most small businesses are in chaos, lacking a way of doing business that works For most business owners, their businesses don t serve their lives; they consume their lives Most small business owners don t have a personal life plan that purposefully guides their daily actions Most small business owners perform too many functions (wear too many hats) and have no plan for freeing themselves from the technical work of their businesses Most small business owners don t understand that they can and should create a business that works without them Most small businesses don t have a system for recruiting, hiring, and training effective people Nearly all small businesses are organised around the existing people, rather than business processes Most small business owners blame poor results on their people c) What is leadership? To begin the leadership journey, ask yourself, Am I the leader, or merely the most senior employee in my business? If you are doing the technical work of your business, for example, working IN it, rather than ON it then you are not leading, nor creating value within it. During the time that you are, for example, purely giving advice or performing administrative functions, you are acting as an employee even though you own your business! Leadership has a different meaning for different people. We believe it has three key components: 1. Vision is your dream for the future of your business and the path you take to make it a reality. 2. Action is about turning your vision into reality. 3. Spirit is how you deliver your action; for example your energy, respect for others and sense of fun. d) Your unique leadership style We don t believe in a one-size-fits-all approach to leadership that forces you to be someone you re not. We propose that you take responsibility and adapt the three components into your own style. e) Characteristics of an effective manager The effective manager creates an environment where people feel safe. Employees can learn, challenge themselves, take pride in owning their responsibilities and feel motivated to grow and contribute. Here are some pointers to help you to become the most effective manager you can be: Adopt the mindset of the nurturing parent. Develop the characteristics of an effective manager. Avoid the poison of cynicism. Become a role model for behaviour and spirit in your company. Always present yourself as an effective manager, even if you feel differently perception is reality. 2

3 f) Managing your time Effective time management is key to being a positive leader. Here are some examples of good time management practices: Breaking down large projects into bite-size chunks. Prioritising. Delegating as much as possible. Not overbooking your diary. Setting up do not disturb periods. 3 CULTURE AND POSITIVE EMPLOYEE RELATIONSHIPS Culture is a term that s often bandied around with the purpose of making employees or HR managers happy. But far beyond that, for your business to be successful and profitable, the right culture is pivotal. a) Why is company culture so important? When recruiting employees, it s important to remember that they thrive on a positive company culture. A report by Deloitte in 2012* revealed that: 94% of executives and 88% of employees believed a distinct workplace culture is important to their business success and 83% of executives and 84% of employees thought that having engaged and motivated employees was the top factor that substantially contributes to the company s success. * b) Seven ways to cultivate a positive company culture Hire for attitude Create an enjoyable atmosphere Empower your employees Surprise your employees Create fun challenges Get out of the office Provide opportunities for continuous learning c) Cultural fit It s important to recruit candidates whose values, beliefs, outlooks and behaviours fit in with your organisational culture. One purpose of a job interview is to enable the interviewer to assess the potential cultural fit of a candidate. Here are some questions which can help with this: Do you prefer working alone or as part of a team? What are the characteristics exhibited by the best manager or teacher you have ever had? What is your leadership style? d) Positive employee working relationships A successful business needs its employees to work together co-operatively and harmoniously, putting their energy and attention into getting results for your business and on their own achievement, rather than focusing their energies on people problems. However, you ve probably seen the effects of working relationships that don t work. Even the most cordial, pleasant, and diligent employees occasionally become annoyed, frustrated or angry with their co-workers. Here are the key stages to implement positive working relationships within your business: Conduct a baseline evaluation of current working relationships in your business Adapt the forms, handouts and policies to your business Create a plan to train staff and implement principles of working relationships Conduct training: Implement the principles of working relationships 3

4 4 EMPLOYEE DEVELOPMENT It s important to remember that even if you created the most sophisticated systems in the world, you still need qualified, committed people, not only to use those systems, but to improve them. So one of the most important areas you need to focus your attention on is creating a work environment where your people can grow with you, as they help your business grow. Unfortunately you can t motivate your people to do anything. If you want it done, you ll need to create an environment in which doing it is more important to your employees than not doing it. Where doing it well becomes a way of life for them. Did you know? A common saying is Hire for attitude, train for skill. (visit Why? A good attitude is a far better indicator of an employee s long-term success than already possessing skills you can train them in. Besides, a trainable person with a good attitude can be taught what you need or want them to know. A good attitude is harder to define than specific skills. A good attitude is an indication of someone who appears trainable, is eager to contribute, and has a team-player mind-set. 5 CREATING THE ROAD MAPS FOR YOUR EMPLOYEES SUCCESS Position agreements are written agreements between employees and their managers. They re agreements between responsible adults, grounded in mutual respect and a clear understanding of what has to be accomplished. The basic idea is simple; the position agreement lays out the employee s accountabilities, the employee agrees to them and the manager agrees to support the employee. This helps employees to be accountable for achieving the results of their positions by clearly capturing three specific elements: The result statement, which tells an employee why that position exists in the company. The work listing, which specifies the work required to produce the result. The standards, which describe how the work should be performed. The position agreement also acts as the road map given by the company to each employee, so that each employee will do the right work and get the right results. Some companies give their employees job descriptions during the recruitment process or on the first day of work. Whilst this is better than nothing, a job description is actually little more than a to-do list. Position agreements link everyone in your business (top to bottom and sideways), directly with your strategic objective. The person at the top, the business owner, has overall accountability for achieving the strategic objective. The work required to achieve this is identified and delegated to lower level positions, so that everyone is accountable for producing results that directly contribute to the company s success 6 ETHICS, CONDUCT AND STANDARDS Maintaining a high level of ethics, conduct and standards in your business will increase its authority in the marketplace, creating better relationships with customers and making it more sustainable. a) Ethics Behaving ethically is absolutely critical to maintaining your business s positive reputation. Although Lehman Brothers was ranked the #1 Most Admired Securities Firm in 2007 by Fortune Magazine, in 2008 they hit international headline news with their poor business ethics, which ultimately led to the business collapse. Here are some of the facts of the case: What was the company? A global financial services firm. What happened? They hid over $50 billion in loans disguised as sales. Who were the main players? Lehman executives and the company s auditors, Ernst & Young. How did they do it? Allegedly sold toxic assets to Cayman Island banks with the understanding that these assets would be bought back eventually. This created the impression that Lehman had $50 billion more cash and $50 billion less in toxic assets than they really did. How were they caught? They went bankrupt. Which penalties applied? They were forced into the largest bankruptcy in US history. The Securities and Exchange Commission (SEC) didn t prosecute due to lack of evidence. 4

5 b) Adhering to codes of conduct and standards set In 2017 the Financial Services Authority (FSA) announced a new set of rules that will increase the standards on how international life business is conducted from the Isle of Man. The new rules will start coming into effect from 1 January Some of the largest life companies operating in international markets are based on the Isle of Man, so the new rules represent a major development for the industry. The new Conduct of Business Code focuses on a range of areas, including: the fair treatment of policyholders, granting terms of business to advisers, product development, cancellation rights and professional investor assets. Adhering to the new code of conduct will be obligatory for all impacted life companies and advisers. 7 EFFECTIVE MANAGEMENT Managing your business effectively is not the same as leading it, but the two are intertwined. By having your end-goal in mind, effective management is about organising the business in a way that runs independently and efficiently, breeding success. a) The purpose and objective of management is to increase business continuity by minimising people-dependency. To do so, business owners should develop their positions and people around the business, rather than developing the business around its positions and people. So the objective of management is to create robust systems and processes that run every aspect of the business and then develop positions that people can fill to effectively run the systems. b) Business systemisation means you re always aware that your business is a system, and that it s composed of systems within systems within systems, all integrated and dependent on each other to achieve the result you want; your strategic objective. Systemisation is a significant departure from conventional business practice. The conventional approach gets the manager to either come up with a quick-fix solution to a problem, or find the right person to deal with the problem. In both cases the solution is only temporary. Instead, it s important to think of your business as something which is independent of you - as a product of your efforts. Here are some questions to ask yourself, which will help you achieve this: How can I get my business to work, but without me? How can I get my people to work, but without my constant interference? How can I systemise my business so that it could be replicated 5,000 times, so the 5,000th branch would run as smoothly as the first? How can I own my own business and yet be free of it? How can I spend my time doing the work I love to do rather than the work I have to do? c) What about people? If systemisation is the answer, doesn t that mean people are merely cogs in a machine? Systemising your business is not a dehumanising experience unless you make it so it s the opposite! Systems enable your people to pay attention to the things that matter, while all the routine things take care of themselves. They can raise their level of performance. d) Accountability If management is about getting results through other people, then each person in your business must take personal accountability. When your employees take personal accountability, they re willing to stand up and be counted. They re eager to make agreements about their work and their results, and they re committed to keeping their agreements. 5

6 For more information on People Assessment, please contact your Old Mutual International Area Sales Manager. Further Future Fit training modules are available on The information contained in this document was developed in collaboration with Masthead which is a network for independent financial advisers. Masthead is part of the Old Mutual Group which is helping advisers develop their business models. Calls may be monitored and recorded for training purposes and to avoid misunderstandings. Old Mutual International Isle of Man Limited is registered in the Isle of Man under number 24916C. Registered and Head Office: King Edward Bay House, King Edward Road, Onchan, Isle of Man, IM99 1NU, British Isles. Phone: +44 (0) Fax: +44 (0) Licensed by the Isle of Man Financial Services Authority. Old Mutual International Isle of Man Limited is a member of the Association of International Life Offices. Old Mutual International is registered in the Isle of Man as a business name of Old Mutual International Isle of Man Limited. Old Mutual International Ireland dac is regulated by the Central Bank of Ireland. Registered No Administration Centre for correspondence: King Edward Bay House, King Edward Road, Onchan, Isle of Man, IM99 1NU Tel: +353(0) Fax: +353(0) Head Office Address: Hambleden House, Lower Pembroke Street, Dublin 2, Ireland. VAT number for Old Mutual International Ireland dac is S. Registered Office: Arthur Cox Building, Earlsfort Terrace, Dublin 2, Ireland. Old Mutual International is registered in Ireland as a business name of Old Mutual International Ireland dac. PDF13657/INT /May