Igniting Intrinsic Motivation

Roy van Griensven, Head of Commercial Excellence at LANXESS, on the thinking behind the company’s Commercial Excellence Academy — what he asked for before he took the job, how the learning is built, and how progress gets shown while the financials are still catching up. Contributors other than the featured guest are described by role, under the Chatham House Rule.

The short version

• Settle first whether the company wants a transformation or a better outcome from the same operating model. Most want the second and call it the first.
• Then settle what excellence means — best in class, copied from what worked elsewhere, or as good as the constraints allow. The three need different programs.
• A capability is people, process, data and systems together. A pricing tool or a CRM bought on its own moves little.
• Inspire, reflect, apply: a little of what good looks like, a conversation about whether it fits the day job, then one capability each person picks — with ninety days of coaching attached.
• Ninety percent of the measurement work is choosing the right leading indicators. Ten percent is connecting them to EBITDA, as a contribution rather than a one-to-one return.
• Reward the person who shows you the gap. What happens to the first honest baseline decides whether the next one is honest.

Two questions before the work starts

Roy opened by taking apart a word he thinks is overused. Companies say they want a commercial transformation, a commercial excellence program, a step change. In his experience most of them want something else.

The distinction is not semantic. Transformation, taken literally, means doing something different from what you do today. Improvement means a better outcome from what you already do. The two need different money, different sequencing, and a different tolerance for discomfort. So the first conversation he had at LANXESS, before starting, was with the CEO: what do you really want, and why do you want it? He was blunt about the consequence — had the answer been a transformation in name and an improvement in substance, he would have walked away rather than spend two years proving it.

The second question follows the first. If the label is going to be commercial excellence, then what does excellence mean here? Best in class? Copy what has worked for other companies? Or as excellent as we can be inside the constraints we have — one maturity level better than today? Lifting an organization to best in class is a different ambition and a different approach from getting somewhat better, and the unspoken gap between which one is underway is where a lot of programs come apart later.

The fourth guy

He spent his first thirty days listening, which several people in the room said they had done too. What came back was fatigue rather than opposition.

The read on it was not that people were against change. It was that they had watched the sequence before: a different sticker, a different consulting firm, the same shape of program. Put like that, the question they were asking — what will be fundamentally different this time — is a fair one, and answering it is the first piece of work rather than an obstacle to it.

The easy way and the hard way

The default sequence is familiar enough to recite. A performance problem gets named a transformation. Commercial excellence is installed at headquarters. A team is assembled to run projects with the businesses, a consulting firm is hired, the slides show the value at stake, and then results are expected to follow.

Inspiration has its place in his approach, on a strict ration.

The other fifty-five minutes go to two questions: why are we not there today, and what is hampering us? That is also where the second conversation with his CEO landed, put as a choice.

1. 1

   The easy way

   Follow the consulting approach. Run a set of projects, book some impact, show a bottom-line result next year that may outweigh the fee. The warning attached to it: in two years you are back at the same point.

2. 2

   The hard way

   Build the capability structurally — adjust the processes, correct the data, fix the systems, and add the competencies. Slower, less presentable, and the version that lasts.

Underneath both is a point about what a capability is made of: people, process, data and systems. Companies reach for the fourth element first, because it is the one you can buy and the one with a delivery date.

Where direction stops and ownership starts

A strategy changes, and the organization waits for the detailed plan explaining what it means for each person. Roy called that a misconception about whose job is whose. The board and the CEO set direction, guardrails and guidance; filling in how it gets achieved belongs to the people doing the work.

The waiting is learned, though, and organizations teach it. Centralize the decisions, run the initiatives globally, bring in consultants to explain the method, and you have trained people to wait for instruction. So the approach puts a deliberate pause after the inspiration rather than moving straight into a program.

1. 1

   Stop once the direction is clear

   Enough has been said about where the company is going. Pause there rather than rolling into the design of the solution.

2. 2

   Ask where people think it gets stuck

   Complaining is the easy first pass and it is allowed — everything that is wrong, everything the company does poorly.

3. 3

   Then turn it around

   What is the one thing we should change tomorrow? Not the thing someone else has to do, but the thing you can do.

4. 4

   Find where the person runs out of room

   Where does your ability to change it stop, and what does the help you need look like? That answer is the specification for the program.

The people who raise a hand at that point are self-selecting, and the ones who say the current state is fine are giving you information too. What the approach costs is control: headquarters, the board and the business unit leaders no longer know in advance what will be worked on next quarter, which is uncomfortable for anyone whose job is to present a plan.

He was equally direct about the standard finding on why transformations fail, which tends to land on communication breaking down. His view is that the finding describes a symptom. Communication is one-sided and top-down by construction; it leaves untouched the thing underneath the behavior, which is whether the person has any motivation of their own to work differently.

He was careful not to oversell the result. LANXESS is at the start of this, a little beyond the start, and a traditional German chemical company is a hard place to change anything. What he reported is that where intrinsic motivation gets touched, things start moving — people begin asking for help rather than waiting to be told — and that what surfaces is often different from what the board or headquarters expected to hear.

Inspire, reflect, apply

The academy he inherited was conventional on paper: train marketing and sales on modern commercial capability. A hundred slides, two days in a room, some exercises, and the hope that something stuck. He rebuilt it around three steps and a choice.

1. 1

   Inspire, briefly

   A company grounded in fifty years of doing the same thing needs some picture of what good looks like elsewhere and what other companies have tried. It is a small piece of the program rather than the point of it.

2. 2

   Reflect, out loud

   Get people together and ask how it matters in their daily job. Do you recognize this? Would it help you, yes or no? The answer is allowed to be no.

3. 3

   Apply, one thing at a time

   There might be twenty-eight commercial capabilities on the map, and addressing twenty-eight at once seldom works. The center narrows the field to the ones critical to the company over the next three to five years. Inside that, each person picks the one that matters most to their own job over the next three to six months.

4. 4

   Coach for ninety days

   External coaching attached to the choice, working on the thing the person picked. These are what the company calls growth projects.

The combination does several things at once. Ideas surface from inside the organization, so the motivation to see them through is already present rather than something to be manufactured. Improvements land while the work is going on, instead of waiting two years for a program to launch. And some of what comes up turns out to be worth scaling across businesses — a problem solved at small scale that generalizes.

The result he had not planned for was a pull effect. Having started in the commercial organization, the rest of the company began asking for the same approach.

The academy has run seven cohorts and reached 300+ leaders, with fifty-two Growth Projects delivered up to the start of cohort seven and mid-eight-figure, CFO-validated EBITDA impact behind them.

The bell curve, and what the field asks for first

The host added the caution that comes with handing over the choice. In an organization of any size the projects come back on a bell curve — a few outstanding, a large middle, and some that barely got going. That is the cross-section of humanity rather than a flaw in the design, and a sponsor who expects otherwise will read the middle as failure.

The framing he uses with companies getting started is that the skills being taught are the ones consultants use: pick a problem, identify the needs, design a solution, find the roadblocks, work out what resource would move it. Democratizing the consulting process, with support attached. Not everyone responds — but the people who step up tend to be the next generation of leaders, which makes the exercise a talent signal as well as a change mechanism.

What comes back is often subtraction rather than addition. Something takes thirty days that should take less, and it makes for a poor customer experience — can we fix that first? Marketing automation matters less than getting a simple thing done for a customer. As he put it, the work is closer to problem solving than to training on new best practice: removing the things that make it hard to be excellent day to day.

Asked what would make their job easier, the field’s first answer tends to be about load rather than method. Stop launching so many initiatives at once, and stop filling the calendar with meetings that leave no room to do the job.

That is the part he described as the reason for working on this at all, and it sets up where the approach is heading next: out to frontline sellers, mid-level managers and country leaders around the world, with the time, the space and the coaching paid for, starting ninety-day projects at a scale well beyond what the academy has run so far. He was candid about the risk in that — a wave of projects with no clean EBITDA number attached, resting on the belief that the right people step up and the right things get worked on. It is early, and a long way from the old playbooks.

Ninety percent of the measurement work

A participant asked what metrics anchor the program — how he knows it is working. Roy said the conversation with his CEO and CFO started where those conversations start, on EBITDA, and that he pushed back on it as a steering instrument. Bottom-line results move for many reasons that have little to do with whether the work is progressing. What he proposed instead splits the effort in an unusual ratio.

1. 1

   Ninety percent: are these the right leading indicators?

   The bulk of the work is deciding which measures genuinely represent doing something better and different from before, and point in the direction of the strategy. Get this wrong and everything downstream measures the wrong thing precisely.

2. 2

   Ten percent: how do they contribute to EBITDA?

   The connection to the financial result gets made credibly rather than exactly. The word he insisted on is contribute.

The reason is that the same result gets moved by the customer on the other side changing their plans, by what happens in China, by tariffs, by the weather. An attribution claim that precise invites a fight the program will lose. A credible contribution argument survives the same scrutiny.

The analogy he drew came from taking Philips Lighting through separation and IPO. Investors in that process look past the quarterly number to whether the company is progressing into the potential of its strategy. Leading indicators do the same job internally, which is why they have to be tied to the direction of the strategy rather than to activity.

His example is concrete. The strategy calls for growth in particular markets and segments, so the indicator is whether the pipeline of opportunities is growing with customers the company has yet to win in those segments.

Transparency of that kind produces hard conversations. One that came up at LANXESS: the company is over-serving customers with little growth ahead of them. Lowering the cost to serve there frees the money to spend where the growth is — and once people buy into that, both sides of it have their own progression to show, growth accounts moving and cost to serve falling on the transactional ones.

What needs to be true

A participant who had watched the LANXESS program from outside made the sharpest structural point of the hour. Executives naming the lagging indicators they want — EBITDA, revenue — is not a transformation. The transformation is in naming the leading indicators and then putting them to the teams who live in the problem day to day: how would you go about moving this one? And then the question that decides it — do you want to? Strategy set at the top stops being lost in translation at the moment it meets people who can answer, and who get to choose whether they will.

Roy called that part massively important. Financial targets tend to be steep, and steep targets get met with wishful thinking — we will get nowhere near that. The way past it is to set the lagging indicator aside for a moment and ask a different question.

Rather than opening with raise the win rate from X to Y, the dialogue starts with what would have to be true and how it could be influenced. What needs to be done tomorrow to move it one percent? Then from one to five, and five to ten. Some of the answers propose doing the thing differently rather than incrementally, and that needs guiding — this is not only continuous improvement, and some of the moves have to be larger. But a conversation about influencing a leading indicator is a great deal easier to have than one about finding another hundred million of EBITDA, where the number of factors involved makes the question close to incomprehensible at the front line.

Guided discovery

The host offered an exercise that comes at the same problem from the other side. Smart people build a chain of logic — if this is true then we must do that — and by the time the plan reaches the field it rests on a stack of assumptions the field can see straight through.

So instead of writing the plan for how to win, put the inverse to the group: if we were going to miss the target by a mile this year, what would we be doing to blow it? People enjoy answering that, and what comes back is a list of real things — we would stop visiting customers, we would leave this unfixed, we would leave that unfixed. Flip each one over and you have the plan, built out of the team’s own answers. He calls the method guided discovery: walking a team through the chain of logic by asking the questions rather than presenting the conclusions.

The hard part is not the exercise. It is getting senior executives, and internal commercial excellence teams, comfortable asking questions when they are practiced at giving answers.

Reward the person who shows you the gap

The point Roy repeats to his own board at least monthly is not about indicators at all. It is about what happens the first time one of them comes back badly.

Once transparency starts, people show where the problem is and where they need help, and a leader has two available responses. One is to say thank you — this is what our customers are experiencing, what support do you need? The other is to land on the problem and make an example of whoever owned the past performance. The second response works once, and after it the honest number stops arriving.

He acknowledged that this amounts to telling the C-suite how to behave, and made the point anyway: leadership behavior at that level either accelerates a transformation or blocks it, and the block is hard to see, because it shows up as baselines that were negotiated before anyone read them. So reward the honest baseline first, and then show progression from it.

Which led to a conversation he had with board members looking at a transformation dashboard that was mostly green, with business unit leaders showing participation across the board.

The green was recording agreement to take part, and agreement is free — people say yes in the meeting and go back to what they were doing the next day. That was happening. Changing the approach also changed what he could see: who arrived with ideas and content worth arguing about, and who had signed up on paper. He tied it back to the Good to Great point about getting the right people first. With people who want to improve, things move. With the wrong ones you get two or three years of participation and then the realization that little changed in the meantime.