6-2 -- Controlling for success

For this weeks Blog entry I just had to choose Tim Horton's. In our class we were talking about Canadian companies that are coming out of the recession as "winners". Personally, I have been a fan of Tim Horton's ever since I arrived in this country 4 years ago. In a matter of fact, it was the first thing I ever did in Canada, after immigration - drinking a cup of Tim Horton's.
During this recent recession it wasn't hard to see that many Canadians think the same way. No matter what time it was or what day of the week, I can always enter a Tim Horton's and it is never empty. I hardly ever walk right up to the front and place my order either! There are usually people waiting in line. Drive-thru? Even more people in front of me. Sometimes we would be "stuck" in traffic on our way to the grocery store because there is a line up at the Tim Horton's drive-through!

Certainly one of the many things Tim's does right is to introduce something new every once in a while. Because Tim's has such a big fan base, they basically get advertisement for free every time something new is available. Sometimes the new products are a hit, sometimes a failure. Speaking for myself, when Tim Horton's announced the addition of lemonades, I actually heard that on the radio. It wasn't a commercial either, it was THE NEWS! So sure enough I went straight to Tim Horton's to try the new product and - was disappointed. I didn't like it at all. But since I was there I also grabbed a Donut... Tim Horton's has the ability to have customers come back even if they had a bad experience. The core product group of coffee and donuts is well liked by many Canadians so it doesn't matter if a new addition is a success or a failure. Tim Horton's has the luxury of being able to make mistakes and still have customers come back on a regular basis.

A recent change was the change of the coffee cup sizes. Because us students read so much all the time, I like to provide videos in my blogs as a change. This one is more on the humor side too:

And here is the proof that News channels do the advertisement for the company. CBC news on the day the new cup sizes where introduced covered the story. Other companies pay a lot of money for 2 minutes prime time TV on a national TV station:

The Recession hit late in 2008. So lets look at what Tim Horton's did during this time:

2009
February 2009: Announced co-branding with "Cold Stone Creamery"

2010
January 2010: Announced addition of English muffin breakfast sandwich
October 2010: Announced addition of Real Homestyle Oatmeal

2011
March 2011: Announced addition of Real Fruit Smoothies
August 2011: Announced "Tim Hortons Double Double coffee ice cream" at Cold Stone
November 2011: Announced addition of Espresso machines producing "Lattes"
December 2011: Announced new "Egg white breakfast sandwich on whole grain English muffin"

2012
January 2012: Announced new cup sizes
February 2012: Announced addition of "White hot chocolate"
April 2012: Announced addition of frozen lemonade
April 2012: Announced lattes now available as "iced lattes"
May 2012: Tim Horton's now accepts VISA Cards
Source: http://www.timhortons.com/ca/en/about/news_archives.html retrieved June 25th, 2012

As you can see, Tim Horton's kept the attention of it's customers throughout the entire recession with new additions. This again triggered some free advertisement as the word of mouth, not only among the public but in morning shows of radio stations for example.
Not to forget are the "Roll up the Rim" contests in between, that draw a lot of extra coffee drinkers every year.
The prove that this strategy is working can be seen on the Tim Horton's stock price between February 2009 an today. With a value increase of more than 80% and Dividend amount more than doubled, I wish I would have put all my savings in Tim Horton's stocks:

Source: https://www.google.ca/financehttps://www.google.ca/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1340677583864&chddm=323920&chls=IntervalBasedLine&q=TSE:THI&ntsp=0&fct=big retrieved June 25th, 2012


The above announcements emphasize how Tim Horton's practiced an "Output Control" by releasing new innovative products at least twice a year and judging by how well the stock has performed - the management team has used this control method very efficiently! Keep posted for the next invention at our favorite coffee store!

4-2 -- Sustainable Policies

This week I will be making a suggestion for three sustainable company policies. Being a "Kevin O'Leary-type person" always worried about the bottom line, I think there is a huge potential for companies to combine sustainable policies with money savings, which means everybody wins!

Source: http://lifethegreenway.blogspot.ca/2010/12/dreaming-of-green-christmas-save-more.html retrieved June 25th, 2012

One sustainable policy that many companies have adopted, including the one I work for, is a sustainable travel policy. This one just makes so much sense. Technology today is so far advanced that often times travel isn't necessary. By holding meetings online the environment wins since there is less emissions, no hotel room to be cleaned with chemicals, and no taxi ride to the airport. The company probably wins even more since there is less time used by employees to get to and back from the meeting, and less money spent on travel, meals and accommodation. This policy has all four elements in order to be part of a sustainable strategy: it protects the environment by reducing waste, promotes social responsibility by showing that travel is only approved if absolutely necessary, it respects different cultures not more or less than a one-on-one meeting, and has an economic benefit as outlined above.

Another sustainable policy could be implemented as a purchasing policy. As an example a company could only allow to buy office supplies from recycled materials such as notepads, pens and even printer ink cartridges that are refillable. Obviously such a policy could be extended to other parts of the company. A manufacturer could use as much recyclable materials and packaging as possible for its products. By doing this, the company would not only send a strong signal to employees, but also to suppliers and customers outside the company. Such a policy, again, could have an economic impact as well. Part of the policy could be that only paper that is either used on both sides or contains confidential information can be disposed of. I am sure that such a policy would decrease the amount of paper used worldwide by hundreds of thousands of trees each year! This would also bring paper cost for the company way down.

A motivation to have a sustainable policy for energy efficient operation of buildings is the LEED (Leadership in Energy and Environmental Design) Program by the U.S. Green Building Council.
If a company builds or renovates a building, they can get certified for energy efficient design and construction and operations and maintenance. There is a category for homes as well:

Starbucks, is one of many corporations taking pride in getting LEED certification for new and improved future stores as this video shows:

Having an energy efficient store or plant is another way to not only do something for the environment and take responsibility to do business sustainable, but also saves big amounts of money over the life-cycle of a building and gives companies a head start for possible future government requirements.

3-3 -- Short Essay

In order to describe “my company”, I need to provide some background about myself.

I have been thinking about running my own business for a while now. Given the fact that I grew up in a hockey town in Europe, I have been involved in the game from a very young age, just as many Canadians are. After my parents got divorced, my mom was never able to afford to put me into hockey, even though that is all I ever wanted to do as a hobby. I was playing street hockey with my friends instead, not owning much more than a stick and a ball. 

Now the story starts to become unbelievable:

One day, I was pushing my bicycle up a hill, and carrying all my gear to go and meet my friends for an afternoon full of hockey. There was an older couple walking on the sidewalk, noticing my hockey jersey of our local team and asking me which player I like the most. After a little back and forth, they asked to meet my parents. To make a long story short, they were Multi-Millionaires and wanted to do some good. They offered to pay for my gear and hockey fees and enrolled me in the junior team in town.

Today, I still believe this has done me incredible good and this fantastic couple has made sure my life stays on the right track. By playing hockey, I was able to learn team skills and have put my spare time to good use rather than ending up in drugs or alcohol down the road.

I think in Canada there are a lot of families who have a hard time putting their kids into hockey. Let’s face it, it is a very expensive sport.  

Based on the utilitarian model I would love to a have a youth hockey league where money and players skills aren’t the most important thing. It would be ethical to have all the players on the teams play the same minutes every game, no matter what their skill or status is. This would provide the greatest good for the greatest number of people. As a non-profit organization this league would depend on corporations such as the Flames foundation for life and 50/50 ticket raffles (See Flames Foundation for Life) to finance hockey for kids who’s parents can’t afford to pay for it. When I played junior hockey, we had up to 4 practices a week and a game every weekend. My league would keep it simple. There would be 1 practice a week per team and one game. This is enough for players who want to play the game just for fun and who’s goal isn’t the NHL or any other Pro-league. Coaches and Referees would be volunteers who might not be the most skilled either, but who recognize how important this 1 or 2 hour work out for the kids is.

My hockey league would follow the following code of ethics:

- We are a team on and off the ice, no one team member is better or worse than any other team member. 

- Our main goal is to have fun and we share our ice time evenly among all team members. 

- New team members are welcome at any time and can join and leave a team as they wish. 

- We take pride in helping each other as best as we can, because as a team we are all responsible for each others well being.

This youth hockey league would be a socially responsible organization because it would address kids needs to use their time for a meaningful activity, which would keep them away from trouble, teach them team and social skills they will need for the rest of their lives and give them a feeling of belonging.

The divorce rate in Canada is slowly declining since the late 80’s (See stats of divorce rates here) however, still more than 12% of marriages are getting divorced at some point. I am assuming that most of the time, money will be tight for both divorced parties, and even tighter if there are kids. This is something I have experienced myself and I see a need for such an institution. With the opportunity I have been given earlier in my life, it seems like the right thing to do, to pass some of my fortune on to the next generation. As we learned in our text book, this is what ethics is about – the right thing to do. 

2-2 -- Forces and Competition

For today's Blog entry I have decided to write about "Mountain Equipment Co-op" (MEC) and the company's task environment. In particular I will be discussing customers and suppliers as well as Mountain Equipment co-op's managing of opportunities and challenges.

Source: http://www.fritzcartoons.com/camp-food/

The way it all started for the six founders of Mountain Equipment co-op is probably the biggest secret to the company's more than 40 year success story. All six of them started the company because they had to procure their outdoor gear across the Canadian border in Seattle. There was no competitive supplier in Vancouver to be found so they decided to start a Co-op. Being customers themselves, they understood from day one what outdoor enthusiasts are looking for and, more importantly, missing out on! 
By starting a co-op where every customer is a owner at the same time, they got customers involved in the business and sharing a common goal - to have the business succeed. This way of doing business allows the organization to be in touch and close to it's customers, knowing exactly what they demand.
It had given MEC the kind of word-of-mouth advertisement early on among outdoor fans to grow rapidly. Students who were short on cash and looking for great weekends and summers in the woods were able to participate in the co-op at a very low cost and get their gear at fantastic prices. A win-win situation if you will.

Source: Youtube.com

The founders of MEC used the store from which they used to purchase their gear from as the company's supplier. Great emphasize was, and still is, put on products that is manufactured in a sustainable way. The procurement policy of MEC focuses on factories with safe working conditions, legal working hours and reasonable pay. Suppliers and factories are audited on a regular basis and results are reviewed by the board of directors. I was positively surprised how honest MEC reports about problems in factories. They do not hesitate to say that there are many problems in asian factories, but even Canadian operations have their problems as well. I like the attitude of the company to openly share problems, and tell it's stakeholders that they are aware that conditions aren't perfect, but they do offer help to continuously improve these conditions.
One of the initiatives by MEC is a confidential hotline for factory workers to report infractions.

Driven by enthusiastic volunteers who gave the company a big push in the first three years, MEC has grown to 3.3 million members and a stunning $261 million in annual sales.
From what I have researched about MEC, I think this company is going in the right direction. I find it amazing how this company has evolved over the past 40 years and with society becoming more aware of environmental issues and making sustainable choices, MEC is doing the right things while facing this new thinking of it's customer as can bee seen in this video:

A recent smart move by MEC was to team up with Parks Canada to bring the world of camping closer to people who are not yet outdoor enthusiasts but might find joy in this kind of activity.
While most people are still tight on money after the recent recession, this could be a great opportunity to attract new clients who will spend future vacations in Canada, in a tent instead of flying to a far away beach and spending big bucks on all-inclusive vacations.

See the canada.com news article here.

As far as challenges go, I am impressed how this company started with a capital of only $65 and it shows us how determined the employees and managers are, to make things work even if the odds might be against them. As mentioned above, MEC is refreshingly honest about the challenges they face with suppliers and manufacturers, which proves that they are committed to face challenges and change things for the better.

Sources:
www.mec.ca retrieved June 5th, 2012
www.canada.com retrieved June 5th, 2012
http://www.fritzcartoons.com/camp-food/ retrieved June 5th, 2012

1-3 -- Emotional Intelligence and Leadership

In this post, I attempt to explain Emotional Intelligence. By searching the Internet, I have found “the periodic table” of emotions:

Source: http://www.feelingfacescards.com/

But fun aside, there is much more to emotional intelligence…

Emotional intelligence is about someone’s awareness of his or her own emotions, interests and the ability to manage these emotions. During my research about emotional intelligence I came across a great website which explains signs of high emotional intelligence, as well as low emotional intelligence. (Signs of emotional intelligence).

It took me a while to understand the difference between personality and emotional intelligence. Finally, I found my explanation on a dictionary website (Link to Dictionary) where the definition of personality is “the sum total of the physical, mental, emotional, and social characteristics of an individual”. This makes sense, as personality is made up of various parts and emotional intelligence is one part of it.

According to Daniel Goleman (Interview on youtube here) emotional intelligence skills can be learned and the best way to do so, is by asking our peers and find out what our own strengths and weaknesses are. As individuals we have a hard time perceiving our real strengths and weaknesses, let alone our actual personality. We constantly strive for our goals and can easily misjudge ourselves.

Related to emotional intelligence is social intelligence. Rather than knowing and controlling our own emotions, social intelligence is about reading others, finding out what they feel, think and want. Having social intelligence allows a leader to effectively influence followers. Without knowing what someone’s feelings and desires are it is hard to motivate this individual.

Looking at the managerial grid, according to Mr. Goleman “Country Club” and “Team Leader” type leaders are the most effective since they pay close attention to the relationship with their subordinates and therefore will strive to “read” employees and find out what they feel, desire and interests.

Source:http://finntrack.co.uk/leadership/competence/lead5.html

1-1 -- Evolving Management Positions

In the first chapter of our text book “Essentials of Contemporary Management” (Jones, George, Rock, Haddad) I have learned what the “opposable thinking” management style is all about.

I like to think that I am a very logical guy and usually make my decisions on an "either-or" approach. However, over the course of the years I have recognized that this is not always the best way to come to a decision. I can think back of my time in the unarmed forces in Switzerland where I served as a lieutenant and had to manage 3 teams of 8 soldiers each. I could quickly see an improvement of the team's motivation and production when I allowed them to give some input before decisions had to be made. One good example is, our policy demanded that soldiers need to wear the issued boots at all times while on duty. As a lieutenant I obviously wanted everyone to follow these rules with no exceptions as there were insurance and safety concerns related to this rule. One soldier approached me one day and asked if he could wear his sneakers while driving and my initial answer was no, since this would be against the rules. He then mentioned that the shoes are dangerous since they wouldn't allow as much sensitivity while driving and he would be somewhat scared driving a team bus (which he doesn't drive most of the year) up and down the mountains with these shoes. Now this made a lot of sense to me and I haven't thought about this before, so from that day on I have allowed all my soldiers to wear sneakers while driving. They would still have to wear the safety shoes at all times, except for driving.

Since I started working in 2000, I have been working for 3 companies with 5 different managers on 2 different continents. Looking back at these 5 positions, every manager was different. So far, I worked as an Aircraft mechanic, as a Material Coordinator, a Maintenance Technician, a Buyer and again as a Material Coordinator. Given the very diverse jobs I had, it is hard to compare all these managers. They all had to be very different since the tasks for these positions were very different:

As an Aircraft Mechanic, for every bolt I tightened, every inspection I did, there was a piece of paper explaining what tools to use, what task to do first, second, third and so on. In order to change fan blades on an engine for example, there wasn’t much room to do the task different or incomplete. So our supervisor had to make sure we are motivated and work well as team. The task structure was extremely high and all of us were absolutely able to perform our tasks since we all had very specific training. So all our supervisor had to do was “Participating” and “Delegating”. Most days we would just each get our package of paperwork at shift start and not see our supervisor again until the end of the shift since we all were passionate about aircrafts and the paperwork told us exactly what and how to do our tasks.

As a Material Coordinator / Buyer things aren’t always as straight forward. I am still at the beginning of my administrative career and my purchasing limit is fairly low. So every time a bigger purchase has to be done, my supervisor needs to be “Selling”. I might be willing to complete the purchasing task, but unable, since I have a lack of experience (for example in setting up contracts and negotiating) and I also don’t have the authority to go about it on my own. This is where I need to work together with my supervisor and learn from him as I complete tasks with him.

Given my past, it is hard for me to say how much management roles have changed since I started working, but in my particular case, I have definitely seen different types of management styles, which where appropriate for different situations and environments.

One thing I have noticed is that many companies become flatter with fewer Managers. This means that more Managers have to empower their employees in certain areas and hand down some of the responsibilities in order to fulfill their new responsibilities.

The step from an employee to a First-Line Manager seems to be the most challenging. Because the technical skills required for such a position are very high, it takes many years of experience before this step can be taken. Once in Management, I do think it won’t be as much of a step anymore to move up to a middle management position, since technical skills, human skills and conceptual skills have been developed for many years by then and the individual will be much more mature.

Welcome to my Reflective Blog for MNGT-255

Hi fellow students,


Welcome to my Blog for the SAIT course MNGT-255.
I will post Blog entries here on a weekly basis and am looking forward to learn about Management with all of you.


Stephan