The Softer Issues & Your Annual Budget
What are the Softer Issues in a Business? Well they are called many things, but usually the following terms relate to the softer issues in your business: Human Capital, Organisational Behaviour, Professional Skills, People Acumen, Talent Management. To be successful business leaders as chartered accountants, we need to develop our skills holistically as reflected in diagram 1. Authentic Self Awareness and Projected Behaviour relates to the softer issues, that conprises of many different dimensions.
Now as a chartered accountant why do you need to develop your "Softer Side" and as a CA(SA) Business Leader why do you need to budget for the development of your people's softer issues?
To answer this question, let's look at research that has been conducted in the global business environment.
If we take a look at the well publicised research on the Service Profit Chain by Harvard Business School (HBS), leaders have to admit that in business, people are their most treasured investment. The people in your business determine your success. But how did Harvard reach this conclusion.
Well, this was a process of over ten years of research done by proffessors Earl Sasser, Len Sclesinger and James Heskett. They published their research in their book called The Service Profit Chain that forms part of many of the world's top MBA programmes. To keep the research current Harvard continues to research this issue and updates it on an annual basis.
Now The Service Profit Success Chain started with one question: Which companies earn good sustainable profits and what is the reason for this? After studying various companies over many years their conclusion was that: "Companies who make major profits, have very loyal clients. Therefore if you want to make major profits, you have to gain loyal clients."
The next step was to study why these great companies have loyal clients? They found that companies who have loyal clients have satisfied clients. If clients are satisfied, they wil stay loyal, which will lead to greater profits.
But how do we make sure our clients are satisfied, or what leads to satisfied clients? That was their next question. What they found was that clients are satisfied when they receive good service experience. If your clients experience good service they will be satisfied, which will make them loyal to your company, which leads to greater profits.
Now the question is how do we provide a great service or what leads to great service experience? What the professors found through their study was profound. A great service experience can only be provided by loyal employees. You have to love this progression. In other words if you have loyal employees, it will lead to great service experience, which will lead to satisfied clients, which will lead to loyal clients, and which will lead to higher profits.
But now we have to ask this question: How do we get loyal employees? And what the study found was that employees are loyal when they are satisfied in their work environment. And employees are only satisfied in their work environment when they have a positive work environment.
Ok now let's summarise all this: What should our focus then be as CA business leaders? Our focus should be to create a positive work environment, which leads to satisfied employees, and satisfied employees are loyal, which also leads to a positive work environment. Loyal employees and provide a good service experience, which leads to satisfied clients, which in turn leads to loyal clients, which then provides more profits and success.
But how do we create a positive work environment? The HBS study found that companies who have a positive work environment, INVEST in their employees in various ways! This is why HBS keeps reminding leaders to create a positive work environment for their employees. This leads to greater service, loyal customers and eventually higher profits. As a CA business leader in our young democracy, you need to remember that your greatest investment will always be in the people who work for you. Even in the most driven capitalistic environment, you need to remember to invest in your people.
Now, investing in employees and creating a positive work environment have always been seen as the so called "softer issues". But according to management Guru Dave Ulrich, who was placed at the top of all management gurus including people such as Peter Drucker, Stephen Covey and Tom Peters, these soft issues have become the hard edged issues in business, making PEOPLE the real arena where the battle is won or lost! Competitors can copy your product, your strategy, your technology, but it is far more difficult to copy your organisation's unique make-up of people. We see in many companies in SA that strategic values are no longer built around their product, but around their people.
In Fortune's April 2007 issue Anne Fisher wrote an article explaining that Business Schools worldwide, including SA, are changing their curriculums dialing back on pure quantitative skills and adding more softer skills coursework. Why? Because the skills that employers value most are the ones that fresly minted graduates lack and that is the qualitative skills! So what are these skills that they talk about? Diagram 2 reflects the softer skills that should be developed and professionally projected at various levels in one's career.
If we take a look at the research of HBS, Dave Ulrich and Fortune Magazine, we come to the conclusion that it is important for any business to budget for and address these softer issues because if we take care of this soft stuff, the hard stuff will take care of itself. And to ensure that money is not wasted on irrelevant soft stuff, spend time and effort on an annual basis to align your business strategy with the development of your people's soft skills. Biggs' 3P Model in Diagram 3 can assist you with this alignment.
Making Biggs' 3P model relevant to the work environment, we see that your employees' learning strategy should not be viewed in isolation as it is influenced by a number of factors, such as:
Employees bring their abilities, personalities and motives to your business. The business brings the work environment, business strategy, on-the-job training, coaching, mentoring, workshops, assessment, feedback and development to the employees. These presage factors jointly determine the employees' performance. The same employee could perform poorly in one business and high in another business with a more supportive positive work environment.
Right, so up to this point we have addressed a business' strategy for developing the softer skills of its people. As an individual you also need to take responsibility for your development. Diagram 4 lists various Soft Skill Themes and the various dimensions in each skill that needs to be developed.
Soft Skill Themes
Emotional Intelligence (Baron)
Implementation into work environment
Improvement of EQ
NLP Tools and Strategies (Thinking Skills)
Framing and reframing
Pacing and leading (rapport)
Disney creative strategy
Personal and team development
Personality (Various Assessment Tools)
Finding your divine design
Working with calling rather than career
Sense of urgency
Short term wins
Effective Goal setting
Wheel of life
Input and output chart
Leadership @ work
What do leaders look like?
How do we define leadership?
Are leaders born or are they made?
The leaders' greatest attributes
Developing new leaders
Leave a legacy
Identifying existing thought patterns
Identifying the source of personal thoughts
Identifying thinking errors
Substituting limiting thoughts with thoughts that produce growth
Identifying the cause of stress
Stress at work and home
Physical and imaginational stress exercises
Building authentic relationships
Developing those around you
Managing vs. Control
Models and strategies (Individual and groups)
Diversity in the workplace
So what should your approach be as an individual with the development of these Softer Issues? You can use the following four steps to plan the development of your soft skills as an individual:
It has been proven that leaders who prioritise "Development of Softer Issues" on the Annual Budget is rewarded by the tangible results in the bottom line profits. Financially investing in your people's development will not only be valuable in terms of CPD or your people's loyalty and morale, it will also increase their performance and contribute to your business's financial growth. asa
Click here for Diagram 1
Click here for Diagram 2
Click here for Diagram 3
Adel du Plessis qualified as a CA(SA) in 2001. She worked at Deloitte Entrepreneurial Services & Corporate Tax and Lectured at Wits School of Accounting and Monash SA in Financial Accounting. She is a entreprenuer and partner in Therapeia and founder of Lead for Africa (S21). She holds a Masters Degree in Accounting Education (Cum Laude). She coaches, teaches, writes articles and records audio & dvd talks on the "Softer Issues" in the CA Profession. She contributed to an International book on SA's Education Challenges on the "Globalisation of Accounting Standards". Adel was a finalist for SACCI 2010 Business Women, 1st Runner up in 2009 for Mrs UN SA and Silver award winner for ROCCI Community Services Champion. Her vision is to experience each day like her Red wine – with all your Senses!
Hermann is a CSP(SA) and Leadership Coach. He holds degrees in Industrial & Educational Psychology, Theology and Strategic Management. Hermann developed and trains a Leadership Coaching Qualification at NQF 7. He has worked at Krugersdorp High School, Mosaiek (inter-denominal congregation with 3000 members), is the founder and Partner of Therapeia and the SA Director of the IMN. Hermann has been involved in leadership development since 1995. He coaches, mentors, trains and consults in various spheres of personal growth and leadership. His vision is to transform diverse leaders for SA.