BC Business
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If every business initiative brought forth by management is blown off by employees, it may be time to take some tips on dealing with organizational scarring. Learn how to better your business organization and boost performance.
XYZ Company is a mid-sized technology manufacturer that has just begun implementing a quality initiative to increase productivity by eliminating defects and waste. The system is the latest fad in its industry, and management hopes to justify the high price with lower costs and higher profit margins. But employees just don’t seem to be buying in – even after undergoing mandated training. It’s more than just the usual inertia and resistance to change. In fact, some employees are actively sabotaging managers’ attempts to impose the system. Meanwhile, the CEO of ABC Telecommunication, a small wireless supplier that has carved out a niche business, has just read a top new business book on strategic growth in new markets delivered through breakthrough innovation. He thinks it will give him a competitive advantage and that he should significantly change the existing focus of the company. So he tells his 10 employees that everything around them is open to innovation. The sales manager isn’t sure what that means and is unsure how to proceed. Also, the CEO has made these declarations before and they’ve only lasted until he has become enamoured with another initiative. So the sales manager continues to operate as he always did. The CEO grows increasingly frustrated because his team isn’t on the same page. And after the initial kickoff and corporate town hall meeting, everything has gone back to normal. The initiative buzzwords are used only when the CEO is around.
How could organized systems with such laudable goals go so wrong? Because XYZ and ABC, like many large and small companies today, suffer from organizational scarring. Over time they have tried several initiatives, and they always petered out. Personnel often bought in to the first one, but, after newer and often conflicting ones were imposed, they developed thick scars to help them cope with this constant careening from one initiative to another. In management jargon, the company has maligned the “elasticity” of scarce resources, the scarcest of which is its people’s hearts and souls. Organizational scarring is rampant today because there are so many initiatives pushed by various gurus of the month who have turned managers into consumers of complicated improvement systems. Total Quality Management, Six Sigma, Balanced Scorecard and other systems, while often very useful, are just as often implemented simply because they’re management fads or because of best-practice pressure – the “everyone is doing it so we have to too” syndrome.
The result is usually unclear thinking or planning that generates a series of false starts; focus is fuzzy, organizational goals are not considered fully, building of capabilities for the systems have not flowed from strategic requirements, and managers may not have been fully apprised of the impact of what they’re doing. Over time this lack of strategic and collaborative consistency reduces the ability of the organization to evolve to higher levels of performance. Employees develop mental calluses and so respond to each initiative by waiting for the storm to pass and the next to come. Eventually, these calluses accumulate at all levels and the organization becomes immovable and incapable of any kind of change.
Organizations can avoid organizational scarring and boost business performance through strategically and operationally legitimate initiatives by following these tips: • Make thinking visible. Transparency of strategic intent, assumptions behind a project and management of it spreads ownership and commitment. • Align and connect processes and people (organizational capabilities) to the initiative. Ensure the change initiative is derived from the positioning or advantage that differentiates your company. Initiatives are a means, not the end. • Involve everyone when outlining the requirements, objectives and constraints for the initiatives. Show each employee how their role helps the overall program. • Be selective. An organization can only absorb so much on top of its regular work, so pick initiatives carefully. • Set clear expectations, consequences and feedback loops so everyone feels they play a part in enhanced performance. • Monitor formal and informal indicators of success. This will allow you to manage and gauge impact from the initiative. Tim Lewko is a Vancouver-based managing partner at Thinking Dimensions, a global consultancy.