Shareholders put up their future security in the hope of increasing their returns and adding further to their security. They take risk of losing some or all of their dough. CEO remuneration is often tied to how well they increase value for shareholders by driving the share price up and paying out regular fat dividends. Customers buy the product or service, so without them being enthusiastic, the scale of the revenues will fall and so will the share price and dividends. Without engaged employees, the customer won’t be satisfied with the quality of the solution or the service provision. If you don’t care about the company, then you are unlikely to care about the firm’s customers. These interests are not always aligned, so where does the leader need to assign attention?

There is no business without a customer and the reason you have customers is because your staff make sure you have repeater customers, rather than single transactions. CEO attention however is not always focused on the staff. They can see the staff as a tool for arbitrage in order to get more revenues. The “pay em low and charge em high” type of mantra. The USA has confused the world with its up to 300 times ratio between the CEO remuneration and the lowest paid employee. The fact that many failed leaders of big corporations get hundreds of millions of dollars when they are forced out is also astonishing.

I don’t see that as a sustainable model for Japan. As leaders here we need to be focused on recruiting and retaining the best team members we can afford. Recruiting them will only become more fraught in Japan and retaining them will be ever challenging. The way to attract people is by having very deep pockets and paying tons of dough to the staff. If that isn’t an option, then we need to build a culture where staff will trade money for the environment. Getting paid a lot of money to work in a toxic environment isn’t sustainable and eventually people crack and look for a better environment to work in.

How can we engage our staff so that they don’t want to leave and while they are with us, they want to work hard for the enterprise and want to support each other in that process? Gallup’s 2021 survey in the US found that 36% of staff were engaged, 50% were either indifferent or compliant and 14% were disengaged. Japan is hard to judge with these Western surveys. Japanese staff are conservative in their estimations because they are always thinking in absolute, rather than relative terms. Also, questions such as, ”would you recommend our company as a place to work for your friends or relatives?”, have a lot of cultural issues in Japan, that we don’t have in the West.

This is one of those key “engaged or disengaged” decider questions in these surveys. Japanese staff don’t want to take the responsibility in either direction. They don’t want their friends complaining to them about the company they have now joined. They also don’t want to have the company complaining to them about their friend they have just introduced. Better to give this question a low score. Overall Japanese surveys are always at the bottom globally but is that really an accurate reflection of the workforce?

What do staff want? Here is what we found from our surveys looking at the emotional drivers of engagement. Number One was they want the leaders to have a sincere interest in the employee’s well being. The key word here is “sincere”. This means taking a holistic view of the employee and not seeing them as an arbitrage opportunity or a tool to spoon up more revenues. Another key phrase is “well being”. In this modern age employees are taking responsibility for their kids, but also for their parents, as the latter age. That means they need a supportive work environment that puts health and family health above company health.

Sounds sensible, but is that the case down at your shop? As the leader, is that how you are talking and making decisions? Is this an approach that is sustained right throughout the enterprise from top to bottom? Are all the leaders walking the talk, starting with you? There is much more required beyond mere words and slogans to make these approaches the daily reality. Coaching and communication skills for leaders will rank at the top to encourage staff to believe what the company is saying. How would you rank these two skill sets across your leadership bench? If it isn’t where it needs to be, what are you doing about it? Everything is related to everything else, so it needs a complete solution rather than a fragmented result. How is that coming along?

If the client complains directly to your staff member about their poor service, should you go to bat for your team member? Should you publicly apologise and deal with the errant staff member privately? Should you make a public show of solidarity with the staff member and criticise the manner in which the complaint was made? Should you aggressively argue the point with the client? Should you just ignore it and get back to other pressing matters?

The answers to these real life situations will differ, depending on the culture of your society and your legal system. America is a very litigious society and there seems to be a built in reflex to not admit guilt, accountability or responsibility. The upshot of this positioning is to ignore what was said to your staff member and hope it goes away naturally, after the client has gotten their complaint off their chest. Privately, the boss can then commiserate about the “nasty” client and bond with the staff member.

Loopholes are always in high demand in these tense situations. The favourite one is to complain about how the client communicated the complaint. If the client is really losing it and abusing the staff member, that is great for the boss. Now their high horse can be mounted and a full attack on the unreasonableness of the client can be commenced. It is a bit trickier when there is no name calling and no florid abuse of the staff members stupidity. A clear outline of the staff member’s failings by the client is annoying, because it is hard to beat it back. An attack on the language can be made anyway and various deductions made about the “accusatory” nature of the remarks and appeals made for fair play. If the labour market is tight, the boss may be prepared to lose a client in order to retain a key staff member.

How about Japan? Arguing the point with the client is unthinkable. The same applies to taking responsibility and accountability. Japanese clients expect this and if it is not forthcoming, they will keep pushing until they get it. No sweeping under the tatami is acceptable here in Japan. The concept that the client has to be moderate in their communication of their complaint is a non-starter. The client is allowed to be as obstreperous as they like and the guilty party has to accept it.

So as the boss, how do you deal with your staff member? Do you hang them out to dry and bear the full force gale of invective from the client, as a good lesson in client service requirements? Do you stand up for them and defend them against the client’s claims, while privately reading them the riot act? Do you decide the staff member is someone you would rather retain than the client?

I have recently been in all three of these scenarios.

I have been the aggrieved client, observing the American style of “shift the blame back to the complaining client” model. I stood by my team member’s claim against the service provider and went hard to support the argument that the service provision wasn’t good enough. When the shape shifting kicked off, I went even harder to counter that nefarious attempt to slip out of the noose.

I have fired the client. A very unpleasant client began belittling one of my salespeople, when speaking about her. I did not accept that libellous affront and staunchly defended the staff member, without hesitation. I then told my salesperson to fire that client and don’t deal with them ever again and to keep a note in our CRM, for when they get fired and pop up in another company. Life is short and they are not the type of person we want to spend any time with, so we should get rid of them forever. And we did.

I have screwed up. I have had to go hat in hand and apologise to the client for my shortcomings. I have had to sit there and be berated by the client, at length and in great detail, for the error. I had to be not only accountable, but also sincerely remorseful and apologetic. I had to determine to give the money back, without ever being asked to do so.

In principle, we should accept responsibility for our service or product provision and when it is inadequate we should accept the blame and do everything we can to fix it. No mealy mouth platitudes or counter offensives about “inappropriate language”. We should be the one to bear the client’s wrath and deal with our staff members in private. Is the client always right – no. We should stand ready to fire the client too, if that is what the situation calls for.

None of this is easy, but we have to determine what we mean, when we say we are in the business of serving clients. We have to set the example for everyone to follow and we have to be consistent.

Recruiting and developing the perfect team is an illusion, a Fool’s Gold hot pursuit for leaders. Even if you do manage to recruit great people, an increasingly difficult task in Japan where the population is in decline and the improvement of English skills is getting nowhere, they leave. They start a family, get poached for more dough, get sick, need to take care of aging parents or a myriad of other reasonable reasons and you have to start again. The reality is we are always going to be dealing with people in different stages of their career and ability build. It is useful to know which solutions are appropriate for particular situations.

Japan loves the middle of the fence and sitting there is the most comfortable position. In fact, in a mistake, defect free work culture like Japan that makes a lot of sense. Building slack into your world means you never get strained to a point where you might make mistakes. On the other hand, there is a lot of underperformance associated with being in the Comfort Zone, relative to what is possible. In big companies, if promotion through the ranks is determined by age and stage, why would you care? Just sit tight, keep your head down, make no errors and you will rise, like cream, to the upper levels, although never to the very top. That might be good enough for many people.

The flipside of this equation is you get bored. This particularly seems to occur with engineers. They often need something interesting to work on and if they don’t get it, they could be lured to greener, more interesting pastures. For the rest of us, the Comfort Zone saps our will to do our best work. What we do is enough, but not all we are capable of and the gentle hum of that equilibrium, where we face no stress, is like a lullaby, putting us into a state of stasis.

At the other end of the scale are those working in smaller companies, where they have to do everything, because there are not enough specialists. Leaders place heavy burdens on them. They have high expectations of people who are underpowered for high levels of performance. This could be a gap in aptitude or insufficient experience and training. The work is overwhelming and they are very stressed. They run into the conundrum of needing to avoid errors, yet plough through the workload. They are stuck in the Frozen Zone. They are erring on the side of caution, because the no mistake culture is causing them to avoid risk and really going for it.

The Breakthrough Zone is where we want people to live. They are performing at full expectations just within or slightly beyond their capability. They permanently live in stretch goal land. They are able to challenge new tasks, because they know errors are seen as education and mistakes are tolerated in the messy world of innovation.

What is interesting is that our people could be in all three zones, depending on the tasks at hand. The movement between zones is also a constant, as work changes, colleagues change and the company direction changes. In the West, you get hired for a job, the senior leadership makes some decisions about the firm’s direction and next thing you find yourself out on the street. In Japan, you are expected to make the transition.

Someone in the Breakthrough Zone can see their performance decline when given a new, challenging task. Like any new task, there is a learning curve and the initial track of that curve is down. After some period of adjustment their performance begins to track back up again and keeps going up.

As leaders, do we know where our people are across their various tasks? Over time, can we identify the tell tale clues to understand where each person is right now relative to their tasks? Have we got too many people underperforming in the Comfort Zone for some tasks? Have we given so many tasks to others that they are overwhelmed and stuck in the Frozen Zone? How many would we identify as being in the Breakthrough Zone. Can we see mistakes as education? Are we prepared to accept errors during innovation? Can we anticipate temporary performance decline when new tasks are allocated? Are we giving people enough training and support? What is the culture we are creating?

We need to know these things if we are going to see the best performance from our crew. Yep, we are busy like bees on speed, but we need to be watching carefully how people are doing, task by task. Have you ever done that or thought that way? If I asked you, could you plot your team in a matrix, zone by zone, across their tasks? Perhaps, it is time to do just that and keep doing it.