Issues facing Organisations - and some solutions


Nothing stands still. World competition ebbs and flows across different parts of the globe. Customers' needs and perceptions change. We carry the cultural baggage of ways of working together that may have worked in the past but lack credibility today. We squander the little knowledge we learn and fall back on old trusted techniques. Every day we look for some stability, some firm ground from which to plan our own future without needing to take account of anyone else. If we believe that this state will ever come about then we are living in a state of self-delusion. The outside world can be a cruel place.

Lessons from the world stage

History tells us that although many lessons are learnt during each economic cycle, there appear to be something in the collective psyche of the leaders of many companies that lends substance to the proposition that 'hoping for the best' is a strategy practised by many. That management is a science and the skills required are a key competence to be learnt and applied is too often ignored by those that have achieved short-term results in a business through adopting techniques that have served them well in previous global economic conditions.

The certainty in business life is that the future is not that predictable. At best, some parts of the organisation's future can be controlled and the path to the future determined. Any change that improves the business disturbs the local equilibrium in the pool of immediate competitors, and some reaction from them is predictable. But one must always be on one's guard for the emerging competitor, the one that strikes from another sector or from another nation. There are no rules, nobody will behave as the perfect gentleman, no organisation has the right to be successful, survival is not compulsory.

Behaviours driven by our attitudes and beliefs

A company, business or organisation can be viewed as a system of collective behaviour that determines the relationships with the environment, society, customers, suppliers and competitors. The system of behaviour is driven by the shared beliefs and values and, to an outsider, can be categorised as the organisation's common purpose and way of doing business; its culture.

Interactions within an organisation between groups with different beliefs and values are a source of conflict. More insidious and, in the long term, more damaging are the situations where individuals feel they need to conform to standards of corporate behaviour, rather than behave in a manner that is determined by their own beliefs concerning the customer relationship. When this happens, the result is invariably frustration and low morale. For most people, the influence of management's expectations is infinitely more powerful than the influence of meeting customer expectations.

This introduces a very human dimension and presents severe challenges to our traditional thinking on management. The challenge is to harness that latent dedication, involvement and excitement that can be delivered by staff sharing beliefs and values that align with a management aligned to meeting customers' needs.

Haunted by the past

Everyday we do the best we can with the knowledge we have. Where approaches in the past have delivered leaps in productivity they were grabbed and copied with enthusiasm. Such it was that work study and productivity schemes were based on the premise that the worker had to be encouraged through rewards to give up the time the worker built in to every task in order to have an easy time.

Experience now suggests that most improvements to productivity arose from changing elements of the process outside the worker's direct control. Improving tooling, the accuracy of drawings and data, and the availability of materials, all contributed to improving the system in which the worker toiled. Although changes to the system around the worker came about through management exercising their authority to make the change, in most cases the worker remained a commodity in the centre, available only to sell hours to the company.

The relationships between management and workforce became antagonistic and uncooperative as a result of this treatment of the laudable desire to improve the effectiveness of the business. The perceptions on both sides, once coloured by the role management believed it had, the right to manage, set in concrete the expectations each had of the other's behaviour. In such an environment, the role play served only to perpetuate poor management practices. To get on in such a company one only had to learn from those above and repeat the same management approach.

The atmosphere of antagonism never proved sufficient cause for management to question seriously its own approach to managing the business. On the contrary, the improvements to productivity were seen as attributable to management's firm actions against the tide of the workforce's reluctance to do a fair day's work for a fair day's pay. After all, everyone could see that the same approaches were common practice wherever one looked. Any change in approach would just have been change for change's sake.

Why is it that we still hear management calling for increases in productivity from their workforce to pay for salary increases? The implication from such a request is clear; it is the workforce that are dragging the company down.

Exhortations to improve have only served to alienate staff from management. To achieve improvements, everyone must be motivated and become involved. Obtaining improvements requires that management create the environment where staff can propose change in a structured approach that is based on the knowledge of how the people interact with the process in which they work. Knowledge then becomes the essential ingredient that motivates towards continuous improvement. For years, managers have 'managed without knowledge. If continuous improvement is a key ingredient to ongoing prosperity, then, managers must learn that they need to manage in a new way. In such an organisation, managers have a new role.

We do the best we can with the knowledge we have

As we learn more we can apply this knowledge to create a better understanding of the world about us. With knowledge, we can apply new techniques to improve the business. If it was that easy, then every day it would be everyone's task to search for knowledge and apply it, and we would all be actively encouraged to do so. But this is not always the case. So often, new knowledge is seen as a threat. We have to accept that what we knew in the past, what had served us well, may now be discredited. This is not to say we were stupid, after all we can only do the best we can with the knowledge we have. Why is it then that the bearers of new knowledge find themselves so persecuted? It is only in recent times that Copernicus and Galileo have been vindicated and their heretical theories accepted in certain quarters.

The warning signs of failures in current processes

If a business process is failing, then what is causing the failure? We can think of errors, mistakes, misunderstandings and so on as being viruses that infect processes. Once such a virus is in the system its presence is felt and if the system is not treated to become immune to its effect, then the virus escapes and infects others. A system that contains viruses is one that produces a variable output; the results are no longer predictable, stable or of high quality.

Like any illness, though, do we always know what we are treating? The effect of the virus can create serious symptoms and our response is most often determined by the higher visibility of the symptoms which divert us from attempting to treat the root cause. What is important is to be able to recognise the difference between symptoms and causes, and then with knowledge and sufficient time, treat the root causes. What often mitigates this is a traditional measure of a good manager; an ability to make snap decisions on little evidence - the 'fire fighter'. To quote Abraham Maslow, "If your only tool is a hammer, you will begin to see everything in terms of nails"

All businesses contain this virus of variability. We attempt to do our best but the system consistently beats us; things just do not happen as predicted every time. Whatever we do, the process contains the virus - parts do not fit together every time on assembly, invoices have mistakes on them, specifications are incomplete, the computer breaks down, the materials are often inferior, things just keep letting us down. The processes we are using are not capable of doing the job. And, if the process is not capable, then despite our best efforts our output will be variable and, in the broadest sense, of inferior quality. Only by working on the process can it become capable and its results stable and predictable.

When processes fail our behaviours become abnormal. We run around like headless chickens, we try and drive through improvements using performance measures that confuse staff, we invest unwisely in Information Technology, and we overburden the organisation with accountancy practices to get a firmer grip on the numbers. We retreat into the comfort of the safe havens of our separate functions, and when all else fails we resort to exhortation, "to do better", and "be right first time".

Everyone follows the rules

Where fear is the norm, or no two-way communication exists, or where reward schemes mitigate against team work then the chances of finding the faults in the process are very small. Similarly, staff are often afraid of highlighting where the process is failing as it is usually seen as a reflection of their own weakness. Some managers never invite their subordinates' opinion of the process, after all, they are managers and what could they learn from the people doing the jobs? When mistakes are common, management tell everyone to get things done right-first-time as if they think everyone came to work just to get things wrong every time.

But can you blame management for the attitudes they hold? Managers and their staff do their best with the knowledge they have. They meet the company's objectives, they follow the rules - in fact everyone does.

No knowledge creates victims

Recognising a virus, its symptoms and root causes is one thing. Making a process robust and immune to its effects is an entirely different matter. Processes are multi-functional and suffer from noise at the interfaces. The culture may actively discourage gaining a cross-functional awareness and the knowledge base may be so low that nobody is really able to spot a virus, its symptoms and root causes. In this scenario, authority to change a process resides with the executive board and few people can know how to improve the process.

As parochialism increases and staff have increasing difficulty in communicating across the organisation, the chances of understanding and resolving multi-functional problems reduces. More insidious and, in many ways, the more alarming is the constraint on change imposed by the relationship managers may have with their staff. A poor relationship swiftly decouples the manager from the very people who have the most knowledge of the process and, particularly, its failures.

Where processes lack robustness they will be susceptible to the viruses from others. While remaining unaware of this effect managers see only failing outputs as being failures of their own staff. This perception can also be reinforced by the department's internal customers pointing out the level of errors to their own highest level of authority. Come appraisal time managers will have carefully tracked the errors their staff have been making - "well, aren't the failures all their fault?"

An impasse. Management is blind to the issues, but with maximum authority to improve the process. Staff with knowledge of the issues are unable to break through the constraint of management. Staff have become victims. The variability of the process, a process the staff have no authority to improve, has created winners and losers. Appraisal is simply a lottery with your chances of losing increasing with the passage of time. In the end, staff just give up.

Why shouldn't they?

Perhaps it will require a more radical approach to the 'role of managers' before real leaps of improvements can be realised.

The starting point for some new thinking - perhaps radical

The starting point is to begin with a mix of people doing a set of tasks using the best methods with a mix of appropriate competences. The hygiene factor of pay is met through the competences they have, which will be visible to all. Their motivation comes from being able to take pride in what they do and recognition from their peers within the teams they are working in. Everyone comes to work to do a good job within their total capability. The conventional measure of 'performance' [who is holding back and doing a bad job] is not an issue and therefore appraisals on this basis are not required. There will be no need to rank people one against another, so there will not exist the notion of people being above or below average. The whole purpose of the team is to maximise the sum of their competences and use measures to improve the processes in which they work and to measure that their outputs are creating the proposition their customers will advocate.

In most cases, everyone's competences will be aligned to the needs of the business. Overall, the growth in competences represents growth and expansion of the business as each person is able to add more value which in turn reflects in their pay. The value they add is in enabling the business to reduce both the cost of doing any task and in being better able to delight and differentiate the company from its competitors. As cost and revenue are being addressed at the same time, then the value added makes the increased reward affordable.

In a conventional structure the pyramid becomes a constraint on growth, as reward is a function of being able to fill a vacant position. In the new type of structure, growth and reward can be simultaneous as more pay is not attached to becoming a manager or waiting for a gap in the organisation. Also, there are no rules concerning pay attached to organisational position. In many organisations people are prevented from being rewarded for their growth in competences as the rules say they first have to be made a manager, a role for which they may have no aptitude or interest and none of the different competences the manager role requires.

A multi-competence team is led not managed

A conventional poor management style will have developed several common characteristics. These are:

Over long periods of time these behaviour patterns have become the accepted norm for managers. Subordinates take this behaviour as a role model and the pattern is perpetuated.

In an ideal process, multi-competence teams would be working in robust processes without any requirement for conventional management activity. In the achievement of a lowest unit cost structure, the change from managing staff to leading teams is the way to achieve the ideal process. A fundamental requirement is the development of the role of a leader. A leader is someone who has those competences that understand processes and interact with other teams to share best practice. The leader role is one of providing help and facilitation to the people doing the work.

To make the point, the people doing the work would appoint their own leader and appraise the individual based on the leader's ability to add value to the processes in which the people work. This turns on its head the notion that a manager is there to check on whether the people have done the work. Conventional appraisals would become a thing of the past, as the leader's task is to match competences to the process and develop the competences within the team. In the new structure, we would also expect the team to recognise if the leader lacked some of the competences of leadership, and the individual would be helped to obtain the necessary skills.

The new role for leaders is largely the opposite of the poor behaviours described above. In addition, the leader will be:

Staff empowerment will appear (rather than be 'given out' by managers). Unfortunately, empowerment has been the casualty of previous management styles and prevented by jobs with little perceived meaning, rigid job definitions that allow little flexibility or exercise of initiative, constant work pressure, lack of communication, uncaring attitudes, and lack of listening. Most of these problems reflect the hierarchical relationships. Empowerment takes time to develop naturally. Instead of competing, teams co-operate and count on each other to get a job done. Most importantly, staff will be accorded respect for their ability to think, challenge and innovate and they will be given recognition for the successes they achieve.

At this point, the staff handbook can be reduced to one page with the single rule; 'use your good judgement in all situations'.

..... but would you take the first step?

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