By Jason Tchir

Bonuses are on the minds of many employees and managers, who are watching their companies’ metrics to see what fortunes this year might bring. But while bonuses might seem like a sure-fire way to motivate employees, the truth is more complicated.

“They’re a part of rewarding employees for achieving and overachieving – but they’re not just driven by sales for everybody,” said Jason Greenspan, chief executive officer and founder of Whbonusoosh Inc., which makes screen cleaners for mobile devices. “If it’s just about sales, it can create this toxic, competitive culture where I just hit my number and I’m done.”

Whoosh allots bonuses based on individual and company performance targets, which vary depending on the employee’s role, and says they’re just part of a fair compensation package.

 “I think bonuses are important. We have corporate targets that have to be met for there to be a bonus pool for everybody,” Mr. Greenspan said. “But they’re not the be-all and end-all for us.”

Small businesses, especially in the early years, may consider giving employees bonuses instead of committing to higher salaries. But there are risks, says Dan Kelly, president of the Canadian Federation of Independent Business.

“Bonuses can be helpful, especially in an environment where you’re just not able to build up that base pay because you can’t be confident sales will be there. The problem is, you can underbonus and won’t get the growth you need, and you can overbonus – and if you hit the gas too hard in the bonus side, you’re left with little money to pump back into the business.”

A bigger question you need to answer is why you’re giving the bonus in the first place. Research shows that bonuses – and other incentives – only make employees work harder if they understand exactly what they need to do to get it, said Marc-David Seidel, an associate professor of organizational behaviour and human resources at the University of British Columbia’s Sauder School of Business.

“It has to be clear,” said Dr. Seidel, who has a PhD in organizational behaviour. “If you don’t do it the right way, it can create competition and resentment – like if you have a team of 10 people and five do all the work, but they all get bonuses equally.”

Not only that, giving people a bonus for parts of their job that they’re already “intrinsically motivated to do,” can actually make them less likely to work as hard, Dr. Seidel said.

Employees care about more than money – and cash alone won’t make them drive a small business to succeed. Small businesses need to recognize that they may not be able to afford to pay the “top drawer” compensation that a large firm may offer, the CFIB’s Mr. Kelly said. But they have other advantages over big businesses.

“Studies show employees rate working at a small business very well on many indicators – access to decision makers, interesting work, flexibility, less bureaucracy – but compensation isn’t the highest,” Mr. Kelly said. “Our advice is [for small businesses] to try and focus their offerings on non-monetary parts of compensation, like flex time, an extra week off at Christmas and the ability to work from home where relevant.”

Giving employees future ownership potential in the company – through profit-sharing, stock options or options for future stocks – can “get them lined up with the goals of the organization, and you don’t need to offer money or a reward,” Dr. Seidel said.

“The benefit of stock is that it doesn’t cost the business owner a lot in those early days,” Mr. Kelly said. “And it gives employees a stake in the future of the companies.”

Weever Apps Inc., which makes an app that lets companies track workers in the field, pays competitive salaries but does not give out bonuses.

“If everyone feels that they’re in this together, then seeing the company make progress should matter – and not an explicit dollar amount tied to a perceived performance,” said Andrew Holden, Weever’s chief technology officer. “There are specific roles, like a salesperson, where tying a bonus to performance makes sense – but when you’re working with engineers, a lot of the most intractable problems are the most hidden ones where they’re taking ownership of processes and making them work better.”

Generally, bonuses tend work to motivate employees in financially oriented companies, but not necessarily in creative fields, Dr. Seidel said.

“If you say, ‘If you’re more creative today, I’ll give you a $100 bonus’ – it doesn’t really work,” Dr. Seidel said. “If you say, ‘I’ll give you more flex days where you can work from a café or from home’ – that might matter more to them.”

If you’re trying to decide whether to offer bonuses, you should ask employees whether they want them – or want that same amount, say $2,000, to spend on things like braces for their kids or massages, Dr. Seidel said.

“They can be really up front. Say, ‘Look, we’ll have this much of a budget to spend,’ and give as much flexibility as you can to let employees decide what they want,” Dr. Seidel said. “Certain employees will be motivated by every cent of a bonus that you give them and others will care more about being respected and good perks.”

 

Snow Removal and You

From Thanksgiving until the end of winter (and sometimes even later), snow may fall in area community associations and create issues of safety and parking that can escalate and become dangerous. The biggest concern and perhaps the biggest complaint that boards struggle with is snow removal. This is usually a no-win situation for the manager (think Snowmaggedon).

snow

Despite what individual owners may think, boards of directors have no control of the snow, but they are responsible for snow removal (or lack thereof). In an effort to meet their legal obligation and to diminish the amount of callers, the board and management should hire a competent, properly insured snow removal company that is reliable. Hiring at the last minute the guy who shows up with the plow at the end of his truck is a mistake waiting to happen. Hiring someone who you are assured will show up as required pursuant to a written contract will go a long way towards goodwill of the owners for the entire year. Aside from the inconvenience and chaos it creates in the community, the removal of snow can be filled with liability issues, so having a competent properly insured contractor in place before the first snowfall is vital.

One favorite issue in a blizzard is when an owner (especially in townhouse communities) cleans a parking space and returns 20 minutes later to see a neighbor has taken over the “common area” parking space. Wars sometime start with this process. Your association may wish to send a reminder at the beginning of the season that all spaces are common spaces and that they may not be reserved.

Workplace Communication

workplace-communicationBy Jessica Miller-Merrell

When most teams within an organization discuss communications, we tend to focus on communication with our customers or for recruiters and HR, that’s communication with our candidates. While this is essential for successful sales as well as recruitment and hiring strategies, effective communication is essential for organizations and their teams. So, how can you ensure good internal communications without losing your primary focus on candidates and/or customers? I believe that by focusing on communication within your workplace and team, you can increase your productivity, reach your goals faster and drive more revenue for the company.

How to Improve Your Workplace and Team Communication

Here are five simple strategies you can implement for effective workplace and team communications that will help improve team productivity, engagement and foster a collaborative culture. 

1. Build and Maintain Internal Relationships

One on one time can make a huge difference in effective communications. With today’s “remote” workers and telecommuters, this can be even more important for those who don’t already spend all day in an office together. Respect their time and keep your meetings brief and friendly, a short lunch or coffee is ideal, somewhere away from the distractions and pressures of the office environment.

2. Collaborate Whenever Possible

Collaboration among teams whether virtual, remote, in person or cross-department is vital. As the old saying goes, two minds are better than one. Whether you need a fresh idea from a different perspective, or simply need some confirmation on an idea you are already working on, ask for help. Being available to help others is the flip side of this coin and does a lot to build communications and trust.

3. Keep Your Meetings Short

Strategy sessions and endless meetings have become a running joke among office dwellers. Only hard core loners hate all meetings on principle, and you can do a lot to make your meetings valuable to all concerned by keeping them short and focused. Keep meetings regular, but only as frequently as is actually productive to minimize the frustration associated with interruptions. Personally, I am a fan of the 30 minute meetings. And I love the 15 minute meeting even more. It can be done if organized effectively, agenda is set and the team members involved understand the goal of the meeting. By keeping meetings short you are driving maximum productivity for not just your team but all parties.

4. Avoid Impersonal Communication

It’s easy to get overwhelmed with too much communication. This can be worse than not enough. To combat this, avoid the urge to send copied messages to those who don’t really need them. Make your communication targeted. The extra time it takes to personalize messages, at least to smaller groups if not individuals, will be made up for by the seriousness your communications will be treated with. By respecting your team members and only giving them what they need, you save them time in sorting out the essential information as well.

5. Open Source Best Practices

Even those who consider themselves least creative, have brilliant ideas from time to time. By providing a place to share the tips and tricks that are working best, you can open source your own best practices among your team members. Whether it’s a great tip for getting the responses you really need in interviews, or a piece of open source software that saves time and money, encourage your team to share what works. Anything that saves time, money, or grief is always appreciated. While I recommend enterprise social media and workplace communication platforms, sometimes a Facebook Group, Google doc, or work platform such as Podio or Basecamp as a central repository for your ideas is the best platform to use.

6. Use Communication Channels That Suit Your Team’s Communication Needs

When it comes to effective team and workplace communication, remember it’s not about you. This might sound strange because you might have had leaders who have demanded they be communicated, engaged or approached in their preferred way. But the economy is strong and times have changed. A team cannot be a dictatorship and the best way to drive communication, engagement and collaboration is with using the methods, mediums and channels your team prefers. So ask them and embrace those channels even if it means using text messaging instead of or in collaboration with email. The key is for your team to work together and communicate in the most effective way. It’s not about you.

The Team Communication Benefits will Astound You

Once open and clear communication is established within a work team, the outgoing communications will improve dramatically. From being able to use team members where their strengths lie, to understanding the motives behind what is being done, the benefits are almost limitless. The important thing is that you remain open and let your employees do the rest. 

 

In the News

in-the-news

Vacation Rental in Colorado

While the Larimer County commissioners may have approved vacation rental regulations in one part of unincorporated Larimer County, that doesn’t mean they apply to the entire unincorporated county. The code compliance department at the county received a complaint in May that Villalobos was running an operation against county code, which requires a single-family dwelling zoned residential to remain just that, with up to an additional two unrelated people.

Read more: http://www.reporterherald.com/news/larimer-county/ci_30687427/commissioners-take-action-against-vacation-rental

 

Top 10 Florida lawsuits from 2016

The real estate business in South Florida is not always glitz and glamour. In fact, it can get so nasty, developers and brokers sometimes find themselves in the middle of salacious lawsuits alleging fraud, self-dealing and other embarrassing accusations.

The Real Deal regularly reports on all the scandalous complaints. Here is look back at the top juiciest cases of 2016.

Read more: http://therealdeal.com/miami/2016/12/23/the-10-juiciest-south-florida-real-estate-lawsuits-of-2016/

 

HOA dissolved in Indiana

Owners of three properties in a neighborhood off Town Hill Road were surprised in late November to learn that their homeowner’s association had been dissolved.

Phyllis Beck, who owned six of the nine lots in the Southridge Trail subdivision which borders Brown County State Park, notified the homeowners by mail that she had dissolved the association as a condition for selling those lots.

Read more: http://www.bcdemocrat.com/2016/12/28/owners_concerned_about_land_sale_with_covenants_gone/

Get Promoted!

By Sabina Nawaz

Jason, a general manager at a Fortune 100 company, worked hard. His businesses were thriving and his team liked working for him. Given his successes over the past year, Jason was hopeful that he’d soon be promoted to vice president. His company usually announced VP promotions in September and February. But in September, Jason wasn’t promoted; another GM was.

Contrast Jason’s situation with that of Bohdan. Bohdan was considered a high-potential leader, the kind of employee CEOs get excited about. He appeared to have a career on an upward trajectory with a huge future ahead of him. Bohdan is exactly the kind of candidate companies like to invest in, so he and 30 other high-potential leaders were invited to a three-day retreat with the CEO and members of the C-suite. During the retreat, Bohdan asked the CEO and CMO, “Do you have any feedback for me on how to prepare to be a vice president one day?”

After the participants left the retreat, the CEO, other executives, and I sat down to discuss the participants. When it came to discussing Bohdan, the CEO smiled and said, “It was funny. Bohdan asked me if I had feedback for him on becoming a VP. He’s barely a GM and he’s thinking about becoming a VP!”

A couple of the other executives had similar responses. Their comments indicated that they liked Bohdan. A lot. Bohdan had a long series of successes and was well liked by his team and his colleagues. But they also thought it was way too early for Bohdan to be asking for feedback on becoming a VP.

success

Key to success

Yet after two years, Bohdan was promoted to VP. He had done something key that day at the retreat. He had asked: What will it take? His direct question indicated to senior leadership, the people he knew would be discussing his career and had the power to decide on his next steps, that he was interested in furthering his career and contributing to the organization. Both Bohdan and Jason had worked hard to prove their capabilities and had delivered exceptional business results. The difference was that Jason had never asked his bosses what it would take for him to get promoted.

You might think it would be obvious that Jason wanted a promotion. Don’t all of us want to advance in our careers? Not necessarily. Some people are content to operate at their current level and do good work because they don’t want the pressures of the level above. Others might not want to relocate (since sometimes that’s necessary to move up). Yet others might want to move up but at a slower pace, once they’re more certain of their skills and the business landscape.

C-suite executives don’t know where you stand if you don’t tell them. As they work on succession planning, they’re eager to help you succeed. Ideally, they’d like to have a phalanx of executives-in-waiting so the organization thrives over the long term. Knowing you are someone who produces stellar results and has the ambition to move forward is the powerful combination they’re looking for, and it will make them more willing to invest in you.

“CEOs, boards, and senior leadership teams in general are always looking to ensure they have bench depth to cover departures, and succession planning is part of that,” Blake Irving, CEO of GoDaddy, told me in an email interview. “While I believe executives (and in fact any employee) should focus on doing a great job at the role they’re in, they also have to let leaders in the company know that they’re hungry to take on more, and when deemed capable, willing to step up. I’ve never believed in blatant self-promotion, but I do believe that you have to let your boss know you’re ready for something bigger.”

What holds you back from asking for what you want? Maybe you think others will see you as overly eager, an aggressive and ambitious attention hound. The truth is, you would risk those negative perceptions if you worked too hard to sell senior management on why you should be promoted. But simply asking the question and then backing up your request with a consistent track record pivots the focus from you and your wants to the well-being of the company.

So where do you start if you want to make it known that your ambitions include a promotion? First, express your overall career objectives with your manager at least once a year. When you ask for feedback, make sure it includes your suitability for the level just above yours or for your desired next career step. You should also make sure that not just your manager but also your manager’s manager and a few of your manager’s peers know your goals and can provide you with feedback. Communicate your plan clearly with your manager so she knows your strategy — you want to make sure she’s not caught off guard when you ask others for feedback and advice. Finally, communicate the breadth of experience you’re looking to build so decision makers can consider you for a wider range of jobs. This might include letting them know whether you’re flexible regarding geographic locations or other logistics.

The executive team wants people who want to lead. Moving up isn’t just a perk; it’s a responsibility. Indicate that you’re willing to take on all the challenges that come with the promotion, and your company’s leaders are more likely to welcome you into their ranks.

Sabina Nawaz is a global CEO coach, leadership keynote speaker, and writer working in over 26 countries. She advises C-level executives in Fortune 500 corporations, government agencies, non-profits, and academic organizations. Sabina has spoken at hundreds of seminars, events, and conferences including TEDx and has written for FastCompany.com, Inc.com, and Forbes.com, in addition to HBR.org. Follow her on Twitter.

New Year – New Board

Welcome to 2017! Do you have new board members at your association? According to ECHO, this is a great time to stress the importance of a Board’s duties, responsibilities and ethics. Ethics are the moral compass that guides the performance of a director’s duties and governance of a homeowners association. Creating a functioning compass means establishing a standard for your HOA to follow when conducting its business. Boards should adopt a code of ethics or at a minimum a code of conduct, to establish a standard for how the board conducts itself and the business decisions of the association.

ethics-sign

Checklist for HOA Board Member Code of Ethics

The code…

✔Defines the value system of the HOA and how directors must behave

✔Clarifies ethical standards regarding loyalty, fidelity, integrity, honesty, confidentiality and competency

✔Establishes ethical standards that enable board members to avoid potential grey areas

✔Incorporates preferred business practices, appropriate legal requirements, and the expected code of conduct for board members

An ethics code or conduct code can be an invaluable tool to ensure that board members are aware of the “line in the sand” when it comes to grey areas and turn an otherwise confusing situation into a clear decision. A good practice is to distribute your board member code of ethics to the homeowners as well as the board. This will make the board’s actions accountable to each other and the homeowners, creating a transparency that’s a win-win for directors and owners.

How do your Board of Director Code of Ethics differ from ECHO’s suggestions? You can obtain a sample code and read more here: http://www.echo-ca.org/article/ethics-code-hoa-board-members

In The News

A first-hand account of the possible tornado that ripped through Charlotte by Bryan Richards.

Editor’s note: C5 writer Bryan Richards sent the following Wednesday night after a tornado ripped through his Ayrsley neighborhood. The National Weather Service confirmed Thursday that a EF1 tornado with winds up to 90 mph hit south Charlotte.

About 6:30 p.m., my family and I left our home in Ayrsley to go out to dinner. We were about a quarter mile south of Westinghouse on South Tryon Street when traffic came to a halt. As we slowed, both of our phones alerted us to a tornado warning, telling us to seek immediate shelter. I could see a torrential downpour ahead of us with strong winds blowing the rain sideways and swaying cars.

Not wanting to get stuck in traffic, I made a U-turn and headed home. In less than five minutes, all of the power was out, including traffic lights. As we entered our neighborhood, which spans between Westinghouse and I-485 off South Tryon, we saw debris everywhere with many trees down. Talking to neighbors, one confirmed that he did see a tornado.

Once the storms past, I surveyed the damage. There were no injuries or major destruction. There was a large gas leak in one of the nearby factories, but the fire department confirmed that it was fixed. The damage we were left with included collapsed decks, shattered windows, damaged roofs, and over-turned air conditioning units. Some of the deck parts and shutters that were airborne took out windows.

The homeowners association, Southern Community Services, was quick to respond and had emergency restoration services onsite by 10 p.m. to board up windows and temporarily fix leaking roofs. Power was still out as of 10:45 p.m. with no indication as to when it will be turned back on.

.

 

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What Happens When Careers Last 20 Years Longer?

by Avivah Wittenberg-Cox

Like many of my peers, I had thought that I could gently start thinking about retirement in my mid-fifties. But as my mid-fifties arrived, and as the debate about the human lifespan rages on, I’ve been confronting a new question: what if I live to 100?

For more, I looked to a book by Lynda Gratton and Andrew Scott, two London Business School professors, called The 100 Year Life. Half the children born today, they say, have a 50% chance of living to 105. That’s up from only 1% a century ago.

We used to have a few simple phases to existence: childhood, education, work, and retirement. Now, entirely new phases of adulthood have emerged. My son, who is in his mid-20s, is pretty typical. After graduating from college, he moved abroad to work for a start-up, first in Haiti, now in Senegal. He is at the very beginning of his career: exploring the world, delaying any kind of emotional or physical settling down that, a generation ago, would have been the norm at his age. This whole decade is an entirely new phase, referred to as ”emerging adulthood,” and it’s something experts are suggesting may be a normal extension of learning and experimentation for a species living in an ever more complex world.

I am also experiencing an entirely new phase of adult development. Like my son, I’m exploring the world and have moved to a new country. I am recently remarried and developing ideas for new businesses. A generation ago, someone my age would have been gently slowing down, while I, and many of my cohort, feel like we’re at the very beginning of the second half of life. My children are grown and gone. I am as free as my son, with a bit more savings on the side.

Our decades strangely resemble each other – and have big implications for how individuals and companies may want to rethink a whole host of issues, from career management and pensions to mobility and leadership criteria.

For individuals, longer lives will mean that we are likely to reinvent ourselves many times over. We will want to learn to re-learn and be open to repetitive re-training. Lifelong learning will become an essential part of adult development.

Gratton and Scott also propose managing a range of assets that go well beyond the financial, although underfunded pensions will be a key challenge for almost everyone, everywhere. They group these into three areas and argue that over time, you want to review that you are investing enough to balance out your portfolio for a lifetime:

•Productive assets: Knowledge, skills, professional social capital, reputation

•Vitality assets: Health, relationships, love, regenerative friendships, balance

•Transformational assets: Self-knowledge, diverse networks, openness to experience

How will companies manage longer lives and postponed retirements? When careers become 50 or 60 years long, they will want to move away from the current, linear career model that puts so much emphasis on the 30s and 40s. This should help parents, and especially women, who have been held back by the business world’s emphasis on the 30s as a make-or-break career decade.

Workers now in their 20s are eager for experience and are more mobile than they may be again for decades. The rise of assortative mating means that more and more people marry someone just as educated and ambitious as they are. This makes many people less internationally mobile than they were in the days of single-earner couples. International companies could start building cross-cultural skills much earlier (and/or much later).

Yesterday, companies were reluctant to employ both halves of a couple, fearing issues of nepotism. Tomorrow, they may shift to managing “family” careers by strategically choosing to hire both people. It may prove a lot easier to manage dual career couples when they both work for you. For many of the larger multinationals with big graduate training programs, a lot of people end up marrying a colleague anyway. Embracing this fact, and working with it, rather than ignoring or discouraging it, could optimize and encourage the skills of two people, rather than enmeshing them in today’s often painful tradeoffs and choices between whose career should ‘take the lead’ and who should “follow.”

The intensity of parenthood peaks between 30 and 35, on average; this period clashes directly with companies’ high potential identification and development policies. For decades, this has eliminated too many women from leadership pipelines. Longer life spans will render this short period of time even less significant than it currently is. Companies will want to manage careers with several talent identification periods, at different ages and stages, rather than just the one currently most common.

As people age more healthily and work longer, the 50s and 60s will emerge as creative new decades of renewal, mobility and wisdom. Aging societies may not be the sad and boring future everyone fears. They may be an innovative and promising reinvention of human potential. Smart companies are already working to make their talent management approaches more flexible, shifting away from the “ladder” and allowing individuals more say in crafting alternative paths along a “lattice.”

Finally, companies will want to integrate the consequences of much longer lives into all their products and services. There are huge new opportunities in analyzing and serving the needs of humans are discovering that life hold entirely new chapters. Moving away from quickly outdating stereotypes of aging, retirement, and recreation, to dynamic new images of re-creation and innovations in lifestyle choices is fertile territory. For example, the over-60s entrepreneur is the fastest-growing segment in the UK and people aged 55-64 started 23.4% of all new businesses in the U.S. in 2012, up from 14.3% in 1996.

 Longer lives will also challenge companies that are already struggling to manage and adapt to the modern workforce – whether it’s adopting policies that work for two-career couples, protecting employees from burnout, or offering the training and development opportunities that 60-year careers will require. Companies have long wanted to ignore people’s personal lives, and compartmentalize between “work” and “life,” but smart companies may want to recognize the connections and support employees through a variety of transitions, both personal and professional. Not doing so may cost more in the long run.

The only thing that you can be sure of about the consequences of longer and healthier lives is that transitions will become routine. We will all need to become skilled transitionists, able to learn, grow and reinvent ourselves. Repeatedly.

 

Case Study in Customer Ratings

by Uri Neren

customer service

In 2011 Avaya had a major likability problem, and the according market performance you would expect. Reeling from the growing pains of a $475 million merger with Nortel, the business communications company faced lingering customer disillusionment and falling profits.

Avaya’s 2011 Net Promoter Score (NPS) was in the 20s (on a scale of -100 to +100), suggesting that it would have a hard time keeping the customers it had, let alone grow on word of mouth.

NPS is actually much more than a likability score: It’s a measure of potential. Yes, a customer who gives a low rating doesn’t like you. But when a customer is eager to tell a friend, it means they love you. And that means gross margin, because people are willing to pay extra for the things they love. For reference, an NPS of +50 is considered very good.

Today, Avaya’s NPS score stands at 65, which is a leap of 40 NPS points in only five years. Most big companies are happy to bump their score up by just a few points in that amount of time.

When facing a reputation problem, most organizations simply rebrand. This is the safe route: stick with what you know but tell the public you are innovating, hoping they won’t notice you’re doing nothing of the sort. But Avaya CEO Kevin Kennedy saw the deeper problem behind Avaya’s NPS score and knew radical change was necessary. (Disclosure: Although Avaya currently has no ties with Innovators International, my interest in Avaya’s remarkable turnaround was initially kindled by the dozens of conversations I had with many people at Avaya when the company was a partner with our organization.)

For Avaya, its lackluster NPS score reflected a simple truth: Innovation was the key to survival because it is the growth engine. In particular, I’d like to focus on three things Avaya did that other companies can learn from:

Treat Innovation as a Risk-Management Exercise

The most-innovative CEOs and the companies that perform at the highest levels are not merely risk tolerant — they manage their company’s diverse risks like an investment portfolio. They understand that the status quo is at least as risky as making some new bets.

Even though the transformation Avaya underwent was risky, Kennedy saw an even bigger risk in that unfortunate NPS score. If customers didn’t like Avaya’s services, it was a bigger risk to stick to the game plan than it was to roll the dice on some new approaches.

Avaya embraced innovation as a risk management exercise. It experimented with new ways of doing things, certain that some of them wouldn’t work. I’ll describe some of Avaya’s specific innovation techniques and strategies below, but again, it’s worth slowing down to emphasize how unusual this attitude adjustment toward risk is. It takes a major cultural shift in the company. You can’t just designate a budget for a few innovators and let the rest of the corporation conduct business as usual. The willingness to experiment has to permeate the whole organization.

Embrace Agile Methods for Responding to Customers

A big part of the problem behind Avaya’s low NPS score was the lag time between a customer communicating a need and Avaya fulfilling the request. Too often, when Avaya delivered tailor-designed products and services for customers, the customer was not satisfied.

When Kennedy and his innovation team redesigned Avaya’s workflow, they cut lag times from six months to three weeks. Now customers were not only getting exactly what they wanted — they were helping Avaya’s design teams tailor communication solutions to their unique needs.

The key to this transformation was an innovation approach common in the software industry: agile invention methodology. In an agile methodology, engineers create multiple versions and iterations of prototypes in a concentrated timeframe to put potential solutions in the hands of users as quickly as possible. The design teams can then use the feedback from their customers to quickly and efficiently improve the products.

With an agile methodology, Avaya didn’t just speed up its workflow — it communicated better with its customers.

Agile invention methodology is one of the 152 innovation methods found in Innovation International’s study of 2000-plus corporations. It’s exciting and it works well, and it cannot be contemplated without believing innovation is a risk-management exercise.

Avaya tried a lot of things that didn’t work. But when the customers were happy with the pace and precision of the solutions they received, no one at Avaya gave those failed attempts a second thought. The risk had been managed well. That’s what agility is: the ability to reposition yourself quickly and gracefully when you take a wrong step.

Tie Your Goals to Hard Numbers

Of course, you can’t embrace risk and ask your middle managers to become agile innovators unless you can explain to them what you want. I can’t tell you the number of times I’ve met with business leaders who cannot actually describe their company’s goals.

For Kennedy, merely describing hoped-for success was not enough. He and his innovation team calculated the hard numbers necessary to determine exactly what Avaya’s goals should be. That meant every step Avaya took could be mathematically measured against the long-term goals of the company.

This is one of the most powerful ways to unshackle middle managers from the day-to-day grind of incremental progress. Setting numerical goals for every activity in the corporation means giving people the room they need to try things out, instead of measuring every day’s work against the previous days. And adding input and throughput metrics to the measurement of output means team leaders can see where they are in relation to the efforts of other parts of the company.

In innovation terms, talent management is usually described simply: get the right people in the right place, and then get the hell out of their way. And you do need to give a good team room to do their best. But getting out the way doesn’t mean leaving people at sea; clear goals and usable structures are a must.

In Avaya’s case, the agile invention methodology was one way its employees were empowered, but there were many others. Greater communication across the company contributed, as did adhering to hard metrics that allowed everyone to understand whether they were succeeding or failing.

Any large company should be able to do what Avaya did. But unless you understand the risks you face and empower your people to innovate, you will be steering straight for the biggest danger of all: staying the same while the world changes around you.

Not all corporations need an agile methodology or this approach to metrics. Our research suggests that nearly any combination of several innovative approaches can create an internal growth engine that leads to leaps in growth. However, as Avaya’s example shows, embracing innovation may necessitate a major cultural shift and the casting overboard of supposedly tried-and-true ways of doing business.

Avaya’s leap in NPS was accompanied by a 5% gross margin increase, which is unheard of in an industry that, as many experts will tell you, is on the verge of a major disruption. Here’s another way to look at it. Avaya’s main competitor has long been a larger, better-known corporation: Cisco. Last month Cisco laid off 5,000 people. Meanwhile, Avaya is hiring.

Uri Neren is the CEO of Innovators International, a collaboration of 30+ multinationals who work together to help each other excel at innovation management and creating future top line growth. He has worked in energy technology R&D and founded The World Database of Innovation initiative in collaboration with the Mayo Clinic.