“If you’re truly going to commit to building a great company, a strong leadership team, and getting the right people in the right seats, you must prepare for change on your leadership team.”Gino Wickman is the author of Traction: Get a Grip on Your Business.
The book, Traction: Get a Grip on Your Business by Gino Wickman, details the Entrepreneurial Operating System® (EOS®), which is a complete tool kit to help leadership teams improve, gain traction, and grow their companies. There are Six Key Components in EOS®, which are Vision, People, Data, Issues, Process, and Traction.
These tools help individuals in the company solve issues, plan and prioritize work, follow processes, communicate with one another, measure data, clarify roles, and lead and manage projects and people.
Clarify Your Vision
The Vision clearly defines “who and what your organization is, where it’s going, and how it’s going to get there.”
The book and accompanying site provide an EOS® tool called the Vision/Traction Organizer (VTO) to help business leaders describe the strategic plan and the Vision. Leaders may understand their visions clearly; however, for the business to grow and succeed, everyone at the company should share in the vision.
The VTO communicates the vision by answering the following eight questions:
- Core Values: These are the three to seven guiding principles for who you are as an organization that helps shape company culture.
- Central Focus: The central focus describes the purpose of why your organization exists and the specific niche that it fits into.
- 10-Year Target: Based on the values and focus, leaders can describe the big-picture goal for where the business will be going a decade from now.
- Marketing Strategy: This plan to promote your products or services consists of your target market, three unique differentiators, your proven process, and your guarantee.
- Three-Year Picture: This goal will describe where your business will be three years from now and helps employees buy into the vision.
- One-Year Plan: This simple goal will outline the three to seven objectives that your business will accomplish that year.
- Quarterly Rocks: These are 90-day priorities that will help your people keep moving toward the long-term time-based goals set by the leadership.
- Issues: These are the company-wide list of problems that will prevent you from reaching your goals.
Shared by All
Once you have defined your Vision in the VTO, share it with the rest of the team to get feedback and further refine it. You and your leadership team have to communicate that vision to get buy-in from everyone. The vision can be effectively delivered to the team at three meetings:
- Company Kickoff Meeting: This event will allow you to reveal your vision to everyone with a speech and question/answer session.
- Quarterly State-of-the-Company Meeting: This recurring event should explain how the company is doing in terms of its goals and reiterate the vision to everyone.
- Quarterly Departmental Meetings: This recurring event occurs at the department level (marketing, operations, finance, etc.) and helps establish priorities for the department.
Right People for the Right Roles
The Right People in the Right Roles is essential to building a great organization with individuals that embody your core values and are in positions that allow them to be effective and valuable.
The Right People “are the ones who share your company’s core values.” They understand the Vision, fit within the company culture, and will work to make the organization better. The People Analyzer™ is a tool that helps you figure out who fits your core values and where the right person fits within your organization.
The Right Seat “means that each of your employees is operating within his or her area of greatest skill and passion inside your organization.” Additionally, each employee has roles and responsibilities that fit within their Unique Ability®. Everyone has their Unique Ability, which is their strongest skills to maximize their effectiveness and worth to the company.
The Accountability Chart™ tool clearly outlines the structure of your organization and defines individual roles and responsibilities. Then, you can use the GWC (Get it, Want it, Capacity to do it) tool to help filter the right people into the right seats:
- Get it: They understand the role, culture, tempo, and how it fits within the organization.
- Want it: They enjoy the role, responsibility, and compensation.
- Capacity to do it: They have the mental, physical, and emotional ability to do the role.
Manage Your Data
Data is the handful of metrics that the leadership team relies on to indicate the present, identify potential issues, and predict the future.
A Scorecard allows one to monitor your business using 5 to 15 high-level weekly numbers. These metrics will provide a pulse for your business and give you the ability to observe the present performance. Additionally, it will allow you to make future predictions, identify issues, and take action in the right direction. The scorecard will evolve as the numbers that you track can change.
This section discusses providing everyone measurables in the form of “a single, meaningful, measurable number to guide them in their work.” Numbers provide for open communication with eight advantages to everyone having a number:
- Numbers remove subjectivity in the interaction between a manager and their subordinates.
- Numbers create accountability as everyone knows what the expectations are for their work.
- Numbers instills enthusiasm as responsible people appreciate numbers to guide them.
- Numbers create clarity and commitment when one understands their numbers and commits to achieving them.
- Numbers promote competition among individuals and teams to perform within the organization.
- Numbers produce results as the numbers that get focused on will improve over time.
- Numbers foster teamwork among individuals to work together to achieve their numbers.
- Numbers solve problems faster as numbers can lead to proactive and objective problem-solving.
Solve Your Issues
Your ability to identify and decisively solve your issues is proportional to your ability to succeed and grow as a business.
All businesses have issues, and through time, the same few problems reoccur, so you have to anticipate and resolve them. First, you have to foster a work environment in which issues are discussed openly and honestly and flow freely up to leadership.
You can create an Issues List to organize outstanding problems and promote transparency. There are three types of Issues Lists for your organization to be effective at problem-solving:
- Vision/Traction Organizer (V/TO) Issues List: These company-wide issues can be resolved during future quarterly meetings.
- Weekly Leadership Team Issues List: These high-level issues can be resolved during weekly leadership meetings.
- Departmental Issues List: These local-level issues can be resolved during weekly departmental meetings.
Issues Solving Track
The Issues Solving Track is a tool to help organizations resolve issues consisting of three steps:
- Identify the three highest priorities and determine the root causes for each issue.
- Discuss the potential solutions and create a plan of action to resolve the issues.
- Solve the issues using the plan of action and assign someone to be responsible for each item.
Wickman lists out 10 Commandments of Solving Issues to help teams prioritize and solve issues effectively, decisively, and for the greater good of the company. Sometimes an organization can be hindered by individuals not getting along, so a Personal Issues Solving Session can be used to bring the individuals together, clear the air, and resolve their differences between them.
Document Your Processes
Your business is run through a handful of core Processes that can be systematized by creating company-wide documentation.
When your processes are systemized and recorded, your people will have more control and greater freedom over their work. There are three steps to documenting your processes:
- Identify core processes within the leadership team, including HR, marketing, sales, operations, accounting, customer-retention, etc.
- Document and Simply core processes using the 80/20 rule, which means that 20% of documentation should capture 80% of the ideas and steps for that specific process.
- Package the core processes into a company handbook, which can be used for reference and training.
Followed by All
When everyone in the company follows the core processes, managers will be more able to manage their people, resolve issues, and grow the business. The business becomes less complicated and more manageable to scale to handle more customers, revenue, and employees. The leadership team has to get buy-in from their employees by showing how the core processes are related, training all to follow them, and managing everyone to work within the system.
Traction is the ability for business leaders to “execute well, and they know how to bring focus, accountability, and discipline to their organization.”
With long-term priorities set by the Vision, rocks are “the three to seven most important things that must get done in the next 90 days.” In each quarter, everyone and everything should have rocks, including your company, leadership team, and all of your employees. Rocks are limited to three to seven (1-3 for employees) because, in the short-term, you should focus more intensely on the most important priorities. Rocks should be SMART (Specific, Measurable, Attainable, Realistic, and Timely), such that they provide clarity and set the right expectations for the work to get done.
Holding frequent productive meetings or having a meeting pulse is essential to gaining traction. The 90-day world can cause a loss of focus, so quarterly meetings are used to reset rocks or priorities. Weekly meetings within the leadership and departments should occur at the same time each week to ensure that everyone stays on track, which causes a spike in work beforehand. The book provides the Level 10 Meeting format for weekly meetings with a specific agenda designed to help you stay focused on what’s essential, solve issues effectively, and keep your team connected.
Putting It All Together
When you implement the Six Key Components of the EOS® Model in your business, you will be able to manage and strengthen your business to establish a healthy, well-run business. It is recommended that you do an Organizational Checkup twice a year to assess and measure a company’s capacity in the Six Key Components using a 20-question survey.