For individuals and organizations alike to grow, they must invest in the skills required to prosper. It’s the combination of five core competencies that make all the differences between success and failure.
Two Core Competencies Models
“A competitive world has two possibilities for you. You can lose. Or, if you want to win, you can change.” — Lester Thoreau, Dean, Sloan School of Management, M.I.T., 60 Minutes, February 7, 1988
Some of these domains between the Katz model and the Core Five are the same, but others are quite different (See the summary table below).
|Johannsen’s Core Five Competencies||Katz Administrative Competencies|
|Conceptual||Strategy & Tactics|
The Classic Model of Competencies
A classic view on organizational skills was contained in an article titled the “Skills of the Administrator” published in the Harvard Business Review (Katz, 1955). The author promoted the view that the necessary skills needed in modern organizational life can be grouped into three general areas:
- Technical Skills
- Conceptual Skills, and
- Human Relations Skills
However, while the Katz model still contains important insights on organizational skills, it possesses certain limitations, especially for:
a. Those who want to break into the executive ranks or
b. The entrepreneur who wants to be more than a sole proprietor.
c. What was done in the 50’s, may not be completely relevant for this century.
Some of these domains between the Katz model and the Core Five are the same, but others are quite different (See the summary table below).
|Johannsen’s Core Five Skills||Katz Administrative Skill-Sets|
|Conceptual||Strategy & Tactics|
The Core Five core competencies model and its assessment serve as a guide to personal development for those who are who desire get to the c-level OR for the entrepreneur who wants to scale the business. Its designed to help individuals understand their strengths and correct their weakness.
The Core Five Competency Model
This core competencies model consists of five categories of skill-sets.
Technical stays as technical. Technology is still a tool, whether it is a hammer, a WIFI network, a gun or artificial intelligence. Throughout your career, you will need to update technical expertise.
Rather than using the general term human relations, the Core Five uses the term leadership. Entrepreneurs and executives have extremely important leadership roles, whether they perform them or not.
Strategy and Tactics
The conceptual domain shifted slight to Strategy and Tactics, a term borrowed from the military. Nothing wrong with being a theory wonk writing a scholarly work few will read. But it’s the ability to execute that makes for a great entrepreneur and executive.
In the Core Five, the management domain was added, a major omission in the Katz model. It is pretty much impossible to be a executive or an entrepreneur without the ability to manage. The b-schools have a point, organizations, projects, process, resources, and money need managers.
The fifth skill set in the Core Five is self-mastery. This was added to address a major blind spots in most people. Few know their weaknesses, and even if known, are clueless about how to decrease them. For how can one achieve success if one posses numerous weakness or heaven forbid, a fatal flaw?
And now we will go through each of them, starting with the technical area.
Core Competency Domain #1: The Technical Arena
“Success usually comes to those who are too busy to be looking for it.” — Henry David Thoreau
“Today’s business graduates have an abundance of technical knowledge. They can do linear programming, calculate a discounted rate of return, develop a sophisticated marketing plan, and crunch numbers on a computer spreadsheet. They’re technically solid, but most lack the interpersonal and social skills necessary to lead people.” — Robbins, S. (1989)
A revolution is sweeping the world at this very moment. It promises things like:
- Robotic maids,
- Replaceable body parts, and
- Electric clothes.
In the next 100 years, we will see more change occurring than what happened during the last 100. What does this mean? It means you must continually improve yourself and your skills.
Keep the following guidelines in mind if you want to stay organizationally employable long-term.
Be An Entrepreneur
You can’t fire the big boss — well that not quite true. Since most entrepreneurs are wise enough not to go public and have a board of directors they have life-time employment as long as they have a strong balance and they’re not stupid enough to let others control 51% of the stock.
Get to the c-Level
Honestly, sometimes I think a public corporation would if it could maximize profits by downsizing to one employee. Actually, a cynic would say that in a corporation of one, the poor CEO would likely keep a small group of sycophants to boss around. Remember, c-level executives rarely fire themselves for incompetence or to improve the bottom line.
Avoid Process Jobs, Find Project Work
Stay away from jobs where you do the same thing the same way. If you’re doing the same thing the same way, a machine can likely do it faster with fewer mistakes. Since projects have more variation that process, expert systems will have a tougher time doing it. That’s why one should consider developing project management skills.
Get Into Sales
I know, no self-respecting business major wants a job in sales. Huge mistake. Sales is the launch pad that rockets you into really understanding people (and why they buy no less).
Learn to Create and to Innovate
It sometimes thought that expert systems may not be able to create. They can learn, surely. But can they come up with ideas beyond their program parameters? Can they create art? Can they write a book? Actually, the last one is not so clear. Programs are already writing articles.
Add More Skills Beyond the Technical
Technical skills are important, but become less important as your responsibilities increase. As you get promoted other skill domains become more critical. Remember, entrepreneurs and executives rarely solve just technical problems.
Core Competency Domain #2: Leadership Skills, especially Transformational Ones
“Only one man in a thousand is a leader of men — the other 999 follow women.” — Groucho Marx
“You manage things. You lead people.” — Grace Hopper, USN, Rear Admiral
Assuming you have the right mix of technological competencies, what else does one need? If you answered leadership, give yourself a B. If you think transformational leadership, give yourself an A.
By definition, a Great Entrepreneur or a great executive must be a transformational leader. Founders have to find a crew, train that crew, and build a group of strangers into a high performance team while making continuous improvements to the norm. And executives need to be transformational if their organizations are to change and innovate.
“My father had a simple test that helps me measure my own leadership quotient: When you are out of the office he once asked me, does you staff carry on remarkable well without you?” — Martha Peak, 1992
It has long been known that while top-notch technical skills allow one to be considered for the first-level of the management chain, it’s people skills that allow you to keep the job. Too often, a technical expert gets promoted and then can’t get along with others — creating a lose-lose situation for both organization and individual.
It’s important to understand that a key source of job dissatisfaction is the quality of the relationship that exists between an employee and the boss. If their manager lacks organizational leadership skills, morale goes into the dumpster and turnover skyrockets.
Still, management rarely wants to spend hard dollars in leadership training since these are considered to be a “soft” skills. It seems to me, that top management’s failure to understand the importance of developing leadership and social skills in the work force is penny-wise and pound-foolish (to quote Ben Franklin).
The venture capital guys like to say that one of their major criteria for putting money into an enterprise is a high-performance team — that great teams build great organizations. That’s not a bad thought, but a team doesn’t happen by accident. It requires a leader who can mold individuals into a unit that’s tougher and stronger than individual members.
Core Competency Domain #3: Strategy and Tactics
“Looking for differences between the more productive and less productive organizations, we found that the most striking difference is the number of people who are involved and feel responsible for solving problems.” — Michael McTague, Management and training consultant, Personnel Journal, March 1986
“My sister lived in Burma and was having some wiring installed by a native electrician. Again and again he would come to her for instructions, and finally, in exasperation, she said, “You know what I want done. Why don’t you use your common sense and do it?” He made a grave bow and said, “Madam, common sense is a rare gift of God. I have only a technical education.” — Carl Compton in the The Public Speaker’s Treasure Chest
The Origen Of Strategy & Tactics
Strategy originates from military doctrine, getting drummed into both officers and NCOs as essential to achieving any objective. Strategy consists of three elements: first defining a current state and then the desired state. Once those two states get fleshed out, it is time to come up with the plan that closes the performance gap between the two states. Those who were exposed to military thinking will recognize the importance of this dimension immediately. Essentially, it’s knowing what to do and doing it.
Sounds easy — but it is not. It is an extremely challenging endeavor in a complex, rapidly changing world to understand what to do and getting it done. Tactics are woven into strategy. You might say that good tactics rely on sound strategy. But while strategy is static, tactics are dynamic, changing, evolving. They exist in time, in a certain context, and require one to stay adaptable and flexible.
There’s an old saying that goes, “No opportunity is ever wasted. If you miss it, one of your competitors will find it for you.” They must develop marketing, sales and competitive strategies that are better than their competitors if they hope to get to the front of the pack. Executives & entrepreneurs must deal with a rapidly changing environment full of risk and uncertainty. An even more subtle part of this skill set involves the ability to find new business opportunities.
Strategy and tactics are largely conceptual skills dealing with the ability to use mental heuristics and relevant paradigms to solve problems and make decisions.
When tactics are done well, we see flawless implementation. But too often we see sound strategy falling apart due to flawed tactics. And I’m convinced that many small business owners are blind to strategy, walking like a drunk down a road where they are really can barely see what the next step will be.
Domain 4: Management
“The most dominant executive decision type, will be decisions under uncertainty.” — Henry Tosi and Stephen Carroll (1976)
[Referring to his managerial counterparts in local government:] How would you like to run a business where your top management can change every two years, your revenue can depend on the whims and fancies of state and national government, and you have to convince more than half a million people that you can collect garbage, control crime, enhance safety, and brighten the future better than anyone else?” — Anonymous executive, Chief Executive, Winter 1982-1983
Despite the fact that many individuals inside organizations consider themselves to be part of management, there is a surprising amount of confusion on exactly what the term “management” means. If you accept the Wordnet definition from the Princeton.edu site, it is “The act of managing something.”
A better definition might be, “Management is the efficient allocation of scarce resources to accomplish an organizational goal.” Contrast this with one definition of entrepreneurial management that goes, “Entrepreneurship is pursing stretch goals without the resources to get there.”
But whatever definition you choose, good management is critical to good government and good business. Management texts classically define five management functions:
- Directing, and
Defining Entrepreneurial Management
The focus on management is important, but can be a trap for the entrepreneur. To understand why this is the case, we need to understand the fundamental context in which management is taught.
Essentially, a management degree creates a person with a set of competencies that work well in long established organizations. The theory base works best in large organizations with an established culture, hierarchy, policies, processes, and procedures. It works less well when one must create all these things from scratch.
Obviously, an entrepreneur needs managerial expertise. But it’s a special type of knowledge typically not taught well in b-schools. For example, one does not need 3 accounting classes to run a small business, nor do you need to know a lot about organizational development (which focuses almost exclusively on large companies). Some economics is helpful, but you probably don’t need 3 or 4 classes. Guerilla marketing is valuable, but it’s normally not taught. Sales skills would be really helpful, but that is not taught either. And of course, human relations skills such as leadership or team building is not covered in the core MBA.
However, one gets good coverage on how to work in large businesses selling products for a shelf; or hocking services to the minions via large budgets, big staffs and a humongous IT infrastructure.
I remember once running across a soon to hit the pavement MBA who was the product of a top MBA program. He described to me how he was going to China to fly to different cities and meet with potential customers. And then he said, “I’m really looking forward to this marketing job.” I said, “It sounds like sales to me.” To which he indignantly responded, “I don’t do sales.”
Recently Clay Christiansen, of the Harvard Business School, opened a conference on innovation in learning with a question: “Why is success so hard to sustain?” His provisional answer was “The reason companies cannot sustain success is that they follow the principles of good management that we teach at Harvard Business School.” (Hauser, 2012)
Core Competency Domain 5: Self-Mastery
This area consists of the development factors necessary to “Be All You Can Be.” It’s a skill set not covered at all in the business schools or in technology programs. Even those with a psychology degree typically do not know how to make their minds run better. Typically, what goes unseen gets neglected.
There is an old story from the Middle East that illustrates this point.
One day a neighbor happens to walk by and see his friend Nasrudin looking for something so he asks, “Nasrudin, what have you lost?” “My key,” said Nasrudin. “Exactly where did you drop the key?” “In my house.” “Then why are you looking here for your key?” “There is more light here than in my house.” Moral of the Story: It’s where you are not looking that you will find the key to what you are looking for.
Finally, we come to the one core competency that almost no one focuses on — the domain of self-mastery. It’s here that we see often see the fatal flaw in both entrepreneurs and executives. Failure to master ones own mind is a weakness, one that can become a fatal flaw.
When one is in power, even small faults become noticed, magnified, and discussed by underlings. Impatience as an engineer is barely noticed, but in the vice-president of engineering, it’s a major problem.
Sometimes its not just one thing, sometimes it is a number of these weaknesses. An experienced investor can easily come up with ten of these most of them unknown to the entrepreneur. One shouldn’t just pick on entrepreneurs, bad CEOs suffer from the same malady.
“The easiest person to deceive is one’s own self.” — Edward Bulwer-Lytton, 1803-1873, English novelist and playwright
This was driven home in a recent book by Marshall Goldsmith called, “What Got You Here, Wont’ Get You There.” In this book he documented twenty-one major faults of the CEO’s he has seen in CEOs. These include faults such as:
- Failing to give recognition,
- Making excuses,
- Acting like you know it all, and
- Not listening.
Many of these are relatively simple behaviors, one mom should have taught them when they were kids. But now they find it next to impossible to change these undesired behaviors.
All entrepreneurs are forever unfinished works. They are imperfect, they have weaknesses, lack knowledge, have yet to gain experience. They must keep evolving, changing, and learning if their organizations are to innovate, change and evolve. So remember:
“If you know others and know yourself, you will not be imperiled in a hundred battles; if you do not know others but know yourself, you win one and lose one; if you do not know others and do not know yourself, you will be imperiled in every single battle.” — Sun Tzu, The Art of War
“The best executive is the one who has sense enough to pick good men to do what he wants done, and the self-restraint to keep from meddling with them while they do it.” — Theodore Roosevelt, 26th American President
Johannsen’s Five core competencies model and its assessment serve as a guide to personal development for those who want to fast track to the c-level, move up a level or two in their organizations, or help the entrepreneur who wants to scale the business. Its designed to help individuals understand their strengths and correct their weakness.
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