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13 March 2010

How to make the step up to General Management

Tag(s): Leadership & Management

The other day I was asked to advise a senior marketer who has enjoyed a stellar marketing career with major blue chip companies in a variety of line and head office staff roles. She wanted to know how to make the step up to general management. I answered as follows:

To begin with leaders need to articulate a vision, engage their colleagues in committing to that vision and above all deliver with enthusiasm and precision. In addition to those prerequisites there are some skill sets that are required:


First, while as a senior marketer you will have developed and practised line management skills you need to have these to a well rounded degree to be able to manage the performance and needs of a great variety of individuals. As a general manager, managing director or chief executive you will need both a high degree of task orientation, to get the job done, and a high degree of relationship orientation, working with colleagues to get the job done.

Robert Blake developed a two dimensional model to plot how these behaviours apply. But the late Bill Reddin of Magill University had the insight to add a third dimension, that of effectiveness.

As a young sales manager with Pedigree Petfoods I was fortunate to be sent on a training course taught by Reddin based on the 3D Theory of Management Effectiveness. An effective manager developed the situational analysis to determine what type of behaviour is called on from him in any particular situation. Different individuals require different management techniques and the good general manager is adept at both knowing which and knowing how to apply them.

Second you must be financially literate. As a senior line marketer you will almost certainly have had profit and loss responsibility but it is less likely that you will have enjoyed balance sheet and cash flow responsibility.  A profit and loss statement only tells you the historic financial performance of the business (and then as reported within a wide range of tolerance). A balance sheet gives you the current snap shot of the business and looks at its total assets and liabilities. A cash flow forecast gives you the future likely operating needs of the business and is the most vital. It is usually for lack of cash that businesses fail.

Again as a young sales manager with Pedigree I was fortunate. Of course I was only strictly targeted with a sales expectation, not even P& L. When I switched to brand management I had mini P& L responsibility for my brand. But all the managers in the company were incentivised on Return On Total Assets (ROTA). Every time the company’s moving annual turnover (MAT) increased by 5% our salaries were increased by 2.5%, known as a “bracket”, providing that the company had maintained its overall ROTA. Thus all of us had an intimate understanding as to how our actions could improve returns through sales volume, cost control etc while managing our assets well through inventory management and cash collection etc. Fixed assets were permanently valued at replacement cost so there was no perverse incentive to run assets into the ground but rather to maintain very modern equipment.

Third, you must be able to manage complexity and uncertainty. For this you need sufficient intelligence, yes, but also sufficient character. Intelligence can be tested on paper, character must be assessed in practice.  General Managers often need to manage actions in parallel ensuring that different executives complete different assignments but coming together on time to deliver an overall project, rather than running everything in series as seems to happen in the civil service and so waiting for Godot or Doomsday whichever comes last for the result.

If you can tick all these boxes you also need to seize the day. Again at Pedigree, when I was newly joined and was attending a sales conference a director happened to start talking to me at the bar. (I later conjectured that it had been deliberate). He said that if I wanted to make Zone 3, the company grade for board directors, I needed to gain experience of more than one function, more than one company within the group, and preferably more than one country. As opportunities arose, first to move into marketing from sales, then to move to another company in the group in another country, KalKan in the USA, I took them. Shortly after I was asked to go to South America and open the corporation's first marketing company in that continent as General Manager. That was nearly thirty years ago and I have been running businesses ever since.

Copyright David C Pearson 2010 All rights reserved




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