Scary News

Volume 7 Letter 10

John Robertson was concerned with the report that he was reading. Recently his rapidly growing business unit had divided one of their regions in two. He promoted one manager internally and hired another externally to handle the newly created regions. While the regions were equally divided according to geography and number of current and potential clients, one of the new regions was far out stripping the other. The more successful of the two boasted a regional growth of over twenty percent with a sales force that was on fire. The other region demonstrated negligible growth and a high staff turnover. He asked himself “why so great a difference in results”?

A recent study could have helped with his question and might help with future hiring and training. The study identified “Effective Regional Business Managers” and classified them as managers who:

  • Exceeded their regional sales goals over a three year period
  • Successfully manage people as demonstrated by low turnover ratios and high numbers of promotions from their team
  • Have a higher proportion of sales districts within the region exceed their goals

The study noted that only thirteen percent of all regional managers qualified as “Effective Business Managers”. This group produces more for their companies and in general exceeds their goals by fifteen percent. The other managers fall short of their goals by three percent on average. So what makes these effective managers so different?

The research identified three key differentiators of effective managers.

    • Superior business planning: Effective managers spend one third more of their time on business planning vs other managers. They identify market opportunities and business drivers and set priorities for their business units.


    • Effective communication: They communicate their business strategy effectively and thus breakdown barriers that are often found between sales, marketing, R&D, and finance. The team cohesion created within the unit helps to ensure the successful execution of the business plan.


    • Entrepreneurial attitude: Effective managers believe that it’s their role to “run the business” not just execute orders. Managers who think this way are seven times more likely to be classified as “Effective Managers”.


The message is that effective managers take responsibility for getting things done. They adapt and respond to the market and figure out how to succeed even when negative events come their way. They engage the whole team in developing and executing the strategy so that everyone knows their role in ensuring the business unit reaches its goals.

Successful managers are not born. They learn how to analyze a market, set goals and develop strategies. They’ve developed skills that enable them to build superior business strategies that are well communicated and keep their people motivated and focused on the end goal.

It sounds so simple yet done by so few (less than thirteen percent of all managers) yet the rewards for the company are huge. Give your managers a gift that they will take with them upward in their careers. Teach them how to “really” build a business strategy and how to use that strategy to motivate all stakeholders to reach their goals. Help your people become “Effective Managers”!

1. Health Strategies group 2006 Study titled “Improving manager effectiveness”

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