Coding Jobs: A Basic Template

We have already covered the (PAEI) styles of CEO’s and profit center units managers, whether they are product managers, strategic business units managers, or division heads. What style is appropriate for the COO as an Executive VP or President? It should be (PAei) – or, even better, (PAeI). The (E) role should be the domain of the CEO.

Now let us look at the most desirable styles for the other members of the managerial team.

Finance

I differentiate between finance and accounting. Finance should look into the future, toward the coming financial needs of the company. What cash flow, what resources will be necessary so that we can finance what we want to do?

Its main function is (P) – but the (P) is return on investment, not products or sales. Who are the clients of finance? They are the stockholders, the owners, the investors. The role of finance is to make sure that investors are happy. They really should not care so much what we (P)roduce, for whom we (P)roduce, or how we (P)roduce, as long as return on investment is competitive.

What belongs to finance is investor relations, relations with the banks and the investment community, and analysis of financial results. Finance should be free to challenge marketing and new product development by asking whether a new product is worth the investment– because that is its role. (A) and (I) are less important. Its code, then, should be (PaEi).

Accounting

While finance is looking into the future, accounting has to look from the past into the present: A balance sheet of profit and loss is actually a present picture summarizing past activities, as of today.

It’s a totally different orientation. Accounting concerns itself with accuracy and following the rules; in other words, its function is, first and foremost, an enormous (A).

What is the next most important role? This goes with a joke: A small firm was going to hire an accountant. Three people showed up for an interview, and each was asked the same question.

The first candidate was a young graduate with a brand-new degree. When they asked him, “What is 2 plus 2?” he said, “Absolutely, without question, 4.”

The second guy came from a large accounting firm. He said, “I’ll have to call the home office first.”

The third guy had a lot of experience in the street – the street of hard knocks. When he was asked, “What is 2 plus 2?” he answered: “It depends. Are you buying or are you selling?”

In other words, for accounting, the second most important role should be (E). Why? Because an accountant’s job is not only to provide data but also to provide information. What is the difference? Information is data organized for making decisions. Your accounting department should be able to give you information, not just data that you are not sure how to interpret. Accounting should be able to organize the data for you, so you can make decisions. The department’s job is not only to collect data for the IRS. Its clients are whoever needs information in order to make decisions. Accounting should be able to tell (P)roduction, for example, what it costs to (P)roduce each of its products or services.

The code for accounting should be (pAEi), with (I) in third place and (P) last – a style that I have nicknamed the “pain in the neck.” A good accountant is supposed to be a pain in the neck: Whenever you try to make strategic changes, a good pain-in-the-neck accountant should show you where the costs are and why you should be careful. On the other hand, if you do not often initiate change, the same accountant should challenge your propensity for staying in place, which could do damage to the company over time.

Basically, a good accountant is a good contrarian.

And that brings me back to my first point: Why I am against putting finance and accounting together. Suppose Finance opposes an investment idea Since accounting is viewed as contrarian all the time on anything, the opposition Finance is making against the investment will be viewed as the opposition of accounting, something everyone is used to and thus it will be ignored. Finance will not have the credibility; accounting will undermine it. Its opinions and recommendations are likely to be ignored; after all, everyone knows that accounting always disagrees with everything – “So what else is new?”

If Finance were separate from accounting, the inputs of the Finance department would be taken more seriously.

Human Resources

A range of styles might be appropriate here, because the function of this department varies in different organizations. The most important role of the human resources department is usually (I), but the role that ranks second is not always clear. If the department’s task is primarily one of “files administration,” as is true for many humanresources departments, the role that ranks second would be (A). If the department is used by management as a tool to increase productivity and efficiency, then (P) would rank second.

I differentiate between human resources (A)dministration and human resources development, which means developing new capabilities. Most human resources departments were once called Personnel; the name was changed because it made the department seem boring and maintenance-oriented. The new name, however, doesn’t change the fact that companies continue to need human resources, such as (A)dministration, performance reviews, and training for its people. These (A) functions are indispensable and cannot be ignored. So I code human resources (A)dministration as (PAei).

Human resources development, on the other hand, is (paEI): It develops new horizons for its employees, and also does executive searches, hiring, coaching, and organizational development that changes the culture of the organization and its staff. It creates and manages change.

For human resources (A)dministration, I recommend hiring a person whose background is labor law, while for human resources development I recommend sociologists, specialists in OD, and organizational or industrial psychologists.

Because the field has not yet accepted my (PAEI) theory, many of the people who work in human resources (A)dministration today have styles that are far more compatible with human resources development. If you want to see frustrated people, people who are hardly ever recognized for their contribution and value to the company, people who are completely mismatched to their jobs, look at the people in.

Human Resources. Although the department is called HRD, in fact what they are doingis (A)dministration. That not only frustrates them; the rest of the organization suspects them because they say one thing but do something else.

Production

In (P)roduction, (P) ranks first; (A) second, (I) third, and (E) fourth. Please note that this doesn’t mean (E) is unimportant. Remember that we are only ranking the relative importance of each role and (I) is very important but not as much as (P) and (A).

The tasks of the (P)roduction department are assembly, manufacturing, and other labor-intensive operations. The focus is on effective and efficient operations, or (PA). Their client is the sales department, and what do the salesmen want? They want the product (or service), on time, at the quality and quantity that was agreed upon. That is (P): What are you going to (P)roduce for me? The next priority for them is (A): They want to (P)roduce the product for the least possible expense, with no waste.

Naturally, for the department to run smoothly, its manager must ensure that people work together, which is (I). So (I) would be the third priority. There is typically the least amount of focus on the (E) orientation, change and innovation, and the reason is that in order to achieve results, many variables must be kept under control for extended periods of time. Thus, those who work in (P)roduction typically resent changes, which require painful adaptations on their part.

Marketing and Engineering

Marketing’s function is to deal with the long run: What is the future environment in which the organization will operate? What will be the future needs of our clients? The role of marketing is to discover opportunities and threats, and to recommend which risks to take in dealing with that future to produce future results. Thus its code would be (PaEi).

In engineering, the four roles have the same sequence of importance as in marketing. The (E) creativity of engineering is directed toward results (P): Whether that involves creating new products(if we are talking about new product development engineering); or designing new processes (new process engineering), or searching for disruptive technologies not yet commercialized (new technology). (I) is important – but not so important that it is allowed to interfere with (E) or (P). And (A), which hinders creativity and replaces it with routine, is the least significant of all.

Thus, both the marketing and engineering departments share an identical code, despite their very different tasks and perspectives: (PaEi).

Sales

Many executives believe the most important role of sales is (P), followed by (E), because a salesperson must be highly creative and flexible to get clients to commit to buying. But I disagree. I don’t think companies want a salesman who is only thinking about getting the contract signed; if you were a sales supervisor, you would want people on your staff who were conscious of and sensitive to the clients’ needs and were honestly trying to make sure the client was satisfied.

So when we talk about individual salesmen, the second most important function after (P) should be (I), followed by (E) and then (A): (PaeI).

On the other hand, the sales manager and the sales department as a whole are responsible for keeping track of thousands of salesmen and possibly millions of dollars. The sales department organizes schedules, assigns territories, provides training, and figures out how to repeat successes across the board. Its second letter, then, is (A), followed by (I) and then (E); thus the code for the sales department is (PAei).

Please note something very important here, which is that the tasks and style characteristics of a sales manager are much more akin to those of a (P)roduction manager than to marketing. It would be a whole lot easier and more pleasant to take a (P)roduction manager and make him a sales manager than to take a good marketing manager and make him a sales manager. If the marketing manager was a lousy marketing manager, there might be hope that he was mismatched in his marketing job and really belonged in sales. He might surprise everybody. But if he excelled in marketing, there would be trouble when he arrived in sales. Why? Because his success at marketing signifies creativity, flexibility, and a long-term perspective. Sales, on the contrary, is on the opposite end of the continuum: Salesmen prefer to stay put so they can stay focused until the purchase order is signed.That is not a task that creative people are generally good at.

Another common mistake is taking a highly successful sales manager and promoting him to a senior position – in marketing! No matter how brilliant this salesman is, he might not have the vision or flexibility that the new job requires. He never needed it for his previous job, and the company never gave him the opportunity to develop it – so where and how is he suddenly going to find it now?

He won’t. Cases like that usually end up with the marketing person accompanying the sales people on sales calls and interfering in their attempts to do their jobs because they want to make the sale.

Of course, some people do make the transition: Those who are well-rounded enough to change their styles easily. But they are also rare. If you manage to find someone like that, you should really try to hold on to him.

Information Technology

IT used to be known as MIS: Management information systems. It is not in the (P) business, as (P)roduction and sales are – although some of its sub-divisions are, such as the data center and tech support: Tech support needs (Paei) and the data center needs (PAei). Other subdivisions, like systems development, need (PaEI). In light of the above mixture of expected styles You could say that IT’s basic function is (pAEi), but the truth is that IT encompasses such a diversity of (PAEI) responsibilities that it’s hard to stay focused on its commonalities – those characteristics that help the department develop a sense of unified identity and purpose.

This is a department where it becomes very obvious very quickly that no one can do it all. If you want an IT head who can supervise systems development, supervise tech support, and supervise data centers, you’d better get yourself a big (I) and you will not be happy because he will not be productive. If you are small you will have to outsource a lot.

If the organization is big enough, I prefer to split data centers and tech support away from systems development. Why? It is much easier to find and match the leadership you need with the style you need when all of a department’s functions have more or less the same (PAEI) code.

Summing Up

The right process really consists of two different processes.

The first, covered in this chapter, involves an organization’s ability to match its employees’ styles and skills with the tasks they are best capable of achieving. This includes finding a workable system for hiring competent people who complement each other in abilities and styles; and promoting the right people into the right positions.

The second process is effective communication. To manage well, you must be able to hear and comprehend what people are telling you, and you must be able to make yourself understood, both one to one and in groups. Communication will be covered in the next two chapters.