A 3-Step Plan for Turning Weaknesses into Strengths

Yan Wang, the former CFO of VitalSmarts, didn’t survive Mao’s China by taking outlandish risks such as questioning those in positions of authority. As our CFO, she did impeccable work with the highest ethical standards. But challenging the status quo was deeply unsettling to her — especially if it meant critiquing the actions of one of our company owners.

She was literally trembling one day when she suggested to my colleague Al that the few dollars he was bringing home from selling copies of our book at public events was hardly worth the time it took our accounting team to process them. She fumbled around the issue until Al said, “So what are you suggesting I do, Yan?” She gulped an enormous amount of air and finally confessed, “It would be smarter to just give them away.” Al agreed. Yan was almost always right. It just took a while to figure out what her opinion was.

Fast-forward a decade. Our company had grown tenfold, and so had Yan. She had become the backbone of accountability in our company. No one, including major shareholders, was off-limits when it came to maintaining standards and creating a culture of fiscal stewardship. Her team was at the forefront of identifying ways to maximize our margins.

Yan’s story is not uncommon. Our research shows that 97% of people can readily identify a career-limiting habit they have. We’re unreliable, lack empathy, avoid conflict, or fear risk. While we’re clear that our weaknesses cost us both personally and professionally, few of us make any progress in turning them into strengths. In fact, managers report that after giving people feedback in a performance review, fewer than 10% of them look any different a year later. But it doesn’t have to be that way. Like Yan, we can make substantial change in relatively short order. The key to improving most weaknesses is to:

Identify Crucial Moments

Chronic weaknesses are usually not due to simple cognitive or behavioral gaps in our abilities. When you’re sitting in your office with a daunting presentation to prepare, and you keep checking your inbox and returning calls instead, it isn’t because you are bad at prioritizing. Rather, you are playing out a deeply habitual and practiced response to feelings of anxiety, inadequacy, or fear. Most of our bad habits have this same nature; more is going on than meets the eye. The way to make progress is to identify the nature of the moments that provoke these ineffective responses. Pay attention to the times, places, social circumstances, moods, physiological states, or risk perceptions that incite you to act in ways that lead to bad results. These are your crucial moments. The good news about crucial moments is that they shrink the size of your problem. Change seems daunting when you think it requires eternal vigilance. In fact, it’s usually about handling a few minutes per day better than you have in the past.

Yan became aware that her crucial moment was when she felt a need to disagree with someone with greater organizational power. She was pretty blunt with peers and direct reports, but speaking up to the owners of the company contradicted every instinct. She felt encouraged when she realized that she didn’t struggle with candor in general — only in those specific circumstances.

Design Deliberate Practice

The Swedish psychologist Anders Ericsson has shown that our learning curve steepens the most when we engage in what he calls deliberate practice. These are brief episodes of intense focus where we practice a skill under relatively real conditions. If these intense practice episodes are coupled with immediate feedback, learning accelerates even more. Psychologist Albert Bandura refers to this as guided mastery and found that we can overcome profound emotional barriers to success if we engage in this kind of skill rehearsal under circumstances with the right mix of safety and challenge.

Once you identify your crucial moments, do what Yan did: Identify moderately challenging situations where you can practice the target skill. For Yan, simply framing these occasions as “practice” lowered the stakes and increased her motivation to attempt them. Following each attempt, she did a mental debrief, rating her effectiveness and stress level. Over time, she found the first rating went up and the second went down, which gave her a greater sense of competence and confidence for the next round. She was careful not to jump into the deep end of the pool at her first attempt. She began by challenging business owners who were late in turning in their expenses. Later she addressed concerns about their spendthrift tendencies — something she felt even more anxiety about.

An important element of deliberate practice is the focus on a discrete skill. Yan studied up on skills for crucial conversations and decided to focus on one: creating safety. She opened a conversation by making an overt reference to the common purpose she hoped she shared with the person she was confronting. In her first attempt, she found this gave her a sense of confidence by suggesting a script with which to begin. But her confidence grew even more when she saw how it put the other person at ease and reduced defensiveness.

Develop Emotional Competence

Be sure your plan includes development of skills for managing the inevitable emotions that accompany confronting a weakness. Simply forcing yourself to attempt a terrifying or uncomfortable behavior is not a success in and of itself; provoking these unpleasant emotions will simply reinforce that this is an act to be avoided. You must seek out tactics you can use to make the unpleasant act more pleasant, or at least manageable. By doing so, you gradually retrain your brain to change its formula for predicting how you’ll feel in your crucial moments.

Yan found that her emotions calmed if she took a moment to clarify her motives prior to opening a crucial conversation with a more powerful person. Before scheduling the conversation, she paused, took a deep breath, and asked, “What do I really want?” Historically, her desire was to avoid conflict with powerful people, but this conflicted with her deeper values. As she pondered what she really wanted, she connected with her desire to be a person of integrity and strength. This awareness helped her subordinate her fears to something more important — and quieted them significantly. It gave her a feeling of focus and determination.

One of my most cherished memories of Yan is the day she let me know that I had wronged her. She told me with great conviction that I had been unfair in the stock award she had been given, relative to others in the firm. She tactfully expressed her disappointment and laid out her case for a different calculation. I ultimately agreed with her argument. But more important, I was struck that the person who admonished me that way was markedly different from the one who trembled out a suggestion to Al just a few years earlier.

You can change your own career-limiting habit if you identify your own crucial moments, seek out brief and intentional opportunities for deliberate practice, and build skills in addressing emotional barriers to your progress. Don’t let fear or inertia hold you back.

Joseph Grenny is a four-time New York Times bestselling author, keynote speaker, and leading social scientist for business performance. His work has been translated into 28 languages, is available in 36 countries, and has generated results for 300 of the Fortune 500. He is the cofounder of VitalSmarts, an innovator in corporate training and leadership development.

A Look Behind The Numbers At Aflac U.S.

In the United States, Aflac has earned the distinction of being the number one provider of voluntary insurance at the worksite.

As a current policyholder and also a former officer at Aflac, I am often asked about Aflac Japan and the huge success that it has been. As I am discussing Aflac Japan with people, many times, those who are asking don’t realize the success of Aflac U.S. and its contribution to Aflac Incorporated. As I was listening to the investor call this morning, I decided to write about it to help others better understand Aflac U.S. and some of the numbers that drive the success.

Over the last 11 years, covering from 2006 -2016, Aflac U.S. assets have grown from $10,249 billion to $19,453 billion.

In that same time period, Aflac U.S. revenues have increased from $4,027 billion to $6,167 billion in 2016.

Aflac U.S. pretax profits have grown from $585 million in 2006 to $1,208 billion as of December 31, 2016.

There are many factors that drive the success, for example, lower claims cost, controlling operational expense, or investment income, but the one that I look at closely is, “the average number of weekly producers, i.e., agents & brokers.”

In 2016, the “average weekly producer equivalents were 9,061,” while the average weekly producer production was $163,501, according to Aflac U.S. investor documents. While the average weekly producer number has decreased each year since 2012, the average production number has increased the last seven years.

Aflac U.S. continues to make adjustments as needed to prepare themselves for the future and the forever changing voluntary worksite market. It will be interesting to watch from the sidelines and watch their success in 2017 and beyond.

 

Aflac Continues to Perform Well – Hits $2.7 billion in 2016 Profits

Calling it an overall solid performance, Aflac Chairman and Chief Executive Officer Dan Amos and his executive team on Tuesday reported net income, or a profit, of $751 million in the fourth quarter of 2016 and nearly $2.7 billion for the full year.

The quarterly net earnings translate to $1.84 per diluted share, up from $730 million, or $1.71 per share, a year ago. For the entire year, the earnings equate to $6.42 per diluted share, an increase from $2.5 billion, or $5.85 per share, the year before.

Those numbers were reached on total revenues of $6 billion in the October-December quarter, up 12 percent from $5.3 billion in the same period the year prior. Total revenues for 2016 came in at $22.6 billion, slightly more than 8 percent higher than the $20.9 billion the insurer racked up in 2015.

The company, headquartered on Wynnton Road and a major Columbus employer, also noted that it increased its cash dividend to investors for the 34th year in a row. Moving into 2017, its board of directors have approved a first-quarter cash dividend of 43 cents per share, payable March 1 to those owning stock as of Feb. 15.

The firm also plans to continue gobbling up its own shares in 2017, expecting to repurchase between $1.3 billion and $1.5 billion worth, much of that activity early in the year. That’s on top of the $1.4 billion in shares bought back by the insurer last year, which took 21.6 million shares out of the open market.

“We are pleased with the company’s overall performance for the year,” Amos said in a statement with the earnings release. “Despite the pervasive low-interest rate environment, Aflac Japan, our largest earnings contributor, generated solid financial results.”

The CEO said sales of third-sector products in Japan, which include cancer policies, are showing good long-term growth of 4 percent to 6 percent. He said the firm’s U.S. operations showed “strong profitability” in 2016, although overall sales results were disappointing for Aflac U.S.

“I want to reiterate that we believe the strategy for growth we adopted in both our career and broker channels is the right one as we look ahead,” he said of the U.S. “As we said on last month’s outlook call, we anticipate a long-term compound annual growth rate of 3 percent to 5 percent in new annualized premium sales.”

The company’s strong cash flow from Japan to the U.S. continued as well, with the money being used to buy back stock shares and pay the cash dividend — which has become somewhat of a sacred cow for those investing faithfully in Aflac’s stock. The low-rate environment in Japan makes it less likely that the firm will invest as much money in the Asian market.

“As we have communicated, absent compelling alternatives, we believe that growing the cash dividend and repurchasing our shares are the most attractive means for deploying capital,” Amos said. “Our objective is to grow the dividend at a rate generally in line with the increase in operating earnings per diluted share before the impact of foreign currency translation.”

Aflac held steady with its overall financial guidance for 2017, projecting operating earnings per diluted share of $6.40 to $6.65, a target based on the yen-to-dollar exchange rate remaining strong.

Net earnings include one-time items reported by Aflac, which can be investment gains and losses and other transactions and costs. Operating earnings, on the other hand, subtract those items to give the investment world a sense of the company’s ongoing operations without those one-time financial events.

That said, Aflac’s operating earnings in the fourth quarter were $630 million, down from $668 million the same three-month period of 2015. The company said it took a pretax $52 million “reserve adjustment” — put money aside — for a block of business related to policies it no longer sells. That product is insurance connected to dementia, with some consumers still alive and holding the policies. Thus, the reserve fund to cover future claims.

Touching on the two markets in which it does business, the company said pretax operating earnings in Japan for the fourth quarter were down 4.3 percent to $775 million, although total revenues were up just over 10 percent to $4 billion. For all of 2016, pretax operating earnings came in at $3.3 billion, up 5 percent from the year before. Total revenues rose more than 11 percent to $16.1 billion.

In the U.S., pretax operating earnings were $262 million, up 10.4 percent for the quarter, although the pretax operating profit margin was 17 percent. The firm attributed to high margin to a lower benefit and expense ratio compared to the October-December period a year earlier. For the full year, the U.S. saw pretax operating earnings of $1.2 billion, nearly 10 percent higher. That was on total revenues of $6.2 billion, up 2.2 percent.

Aflac released its earnings report Tuesday after the close of the New York Stock Exchange. That means investors will weigh in on the financial performance in trading on Wednesday. On Tuesday, however, the firm’s shares were down 36 cents, or 0.5 percent, to $69.99 apiece in an overall down market. The 52-week trading range of Aflac stock is $55.24 to $74.50 per share.

Seven Transformations of Leadership

With the Presidental election over, and all the conversation about the various styles of leaders who were running to be president, I thought now would be a good time to talk about leadership and the different types of leaders.

I have been blessed to have been employed at some world-class organizations throughout my career. I was at General Electric when Jack Welch was the incredible leader. I was at Aflac under the leadership of Dan Amos and who continues to serve as CEO, and I was at Willis North America, led by Dominic Casserly, who guided Willis through some challenging and changing times. Three very successful leaders who performed at a very high level and shared many of the leadership skills and attributes that are needed to be an effective leader.

Earlier this week, I came across an article that I had saved from 2005, “Seven Transformations of Leadership.” The authors, David Rooke and William Torbert, discussed the different types of leaders.

Most developmental psychologists agree that what differentiates leaders is not so much their philosophy of leadership, their personality, or their style of management. Rather, it’s their internal “action logic”—how they interpret their surroundings and react when their power or safety is challenged. Relatively few leaders, however, try to understand their own action logic, and fewer still have explored the possibility of changing it.

They should because David Rooke and William Torbert found that leaders who do undertake a voyage of personal understanding and development can transform not only their own capabilities but also those of their companies. In their close collaboration with psychologist Susanne Cook-Greuter—and their 25 years of extensive survey-based consulting at companies such as Deutsche Bank, Harvard Pilgrim Health Care, Hewlett-Packard, NSA, Trillium Asset Management, Aviva, and Volvo—they’ve worked with thousands of executives as they’ve tried to develop their leadership skills. The good news is that leaders who make an effort to understand their own action logic can improve their ability to lead. But to do that, it’s important first to understand what kind of leader you already are.

What type of leader are you?

1)      Opportunist – Wins any way possible. Self-oriented; manipulative;

2)      Diplomat – Avoids conflict. Wants to belong; obeys group norms;   doesn’t rock the boat

3)      Expert – Rules by logic and expertise. Uses hard data to gain consensus and buy-in.

4)      Achiever – Meets strategic goals. Promotes teamwork;juggles managerial duties and responds to market demands to achieve goals.

5)      Individualist – Operates in unconventional ways. Ignores rules he/she regards as irrelevant.

6)      Strategist – Generates organizational and personal change. Highly collaborative; weaves visions with pragmatic, timely initiatives; challenges existing assumptions.

7)      Alchemist – Generates social transformations. Reinvents organizations in historically significant ways.

Regardless of what type of leader you work for or what style of leader you are, you must have “ Core Values” that includes Integrity, Vision, Ethics and Trust.

Remember, each, and every time you are in front of your employees or independent sales force, you are Selling the Vision and Values, of your company, and you are seeking buy-in from those who are in your audience.

Finish strong the last four days of January and I wish all of you a great first quarter and a record breaking 2017!

 

 

 

 

 

 

 

What Type of Leader Are You

As a leader, you should always challenge people to move out of their comfort zone, but never out of their strength zone. Leadership is all about placing people in the right place so they can be successful.

Most leaders fall into either the climber or connector camp. They are generally either positional or highly relational. Which type are you?

Climbers Think Vertical–Connectors Think Horizontal

Climbers Focus on Position–Connectors Focus on Relationships

Climbers Value Competition–Connectors Value Cooperation

Climbers Seek Power–Connectors Seek Partnerships

Climbers Build Their Image Apart–Connectors Want to Stand Together

Success in leadership comes to those who embrace the best of both characteristics. Many climbers are relationally challenged. According to a recent study, it reported that the greatest problems professionals have don’t relate to their competence; they relate to their relationships.  A survey of over two thousand employers asked them to review the reason for dismissing the last three employees from their businesses. Two out of three said it was because the person fired couldn’t get along with other employees.

If you climb without connecting, you may gain authority, but you won’t have many friends as you climb. A leader should build relationships along the way.

If you’re a natural connector, work to increase your energy and intensify your sense of purpose and urgency. The most effective leaders always manage to balance both connecting and climbing.