Avoiding Another Dumb Management Mania-The Disposable Worker
Filed under: Crisis Leadership, Current Affairs, Performance, Social Commentary
Note from Art: my rant is dedicated to helping keep what is in some circumstances a reasonable business tactic from becoming the latest value-destroying mania.
I wrote last week on “Thoughts on Leading and Managing in the Era of the Disposable Worker.” The post was prompted by an article in BusinessWeek, outlining this latest gem of management wisdom that has organizations of all types rethinking the need for employees and shifting to contract workers. Positions from the CEO suite to those types of roles that we’ve become accustomed to outsourcing, and everything in-between, are fair game.
I’m traditionally leery of fads of all sorts, as they tend to be driven by hysteria, causing normally sane and rational people to act in a manner that defies explanation. I’m fearful that we are on the brink of another horrendous, value-destroying mania as we embrace the short-term cost convenient fad of creating disposable workers.
A Few Examples of Manias Gone Horribly Wrong:
It wasn’t’ so long ago, that almost everyone wondered for just a moment whether the laws of economics had been suspended as the internet gold rush began. Those of us on the sidelines were left to wonder why we weren’t as smart as everyone else and still valued profits over clicks and eyeballs. For a short period of time, our world was one where gobs of money flowed to people with ideas that included losing all of it and then some, and market valuations for firms without a single customer exploded from here to Jupiter. Anyone that dared to question this environment ended up running away from a bunch of options-toting visionaries lest they be trampled in the stampede of outrage. How dare we not understand that clicks and eyeballs were the new replacement for profits and that anyone that could throw around the phrase “data aggregation” was worth funding.
Eventually, the laws of physics and economics reasserted themselves, the dot come bubble burst and we spent a decade creating a new mania in the housing market. Once again, the rules of common sense and gravity won out, yet tens of millions of normally rational people succumbed to the mania and many have lost much more than paper options.
As a wise teacher once indicated, “There is no such thing as a money machine.”
Opinions, Thoughts and Irreverent Observations on this Potential Next Mania:
All of this brings me back to the latest rage of firing your employees and hiring contract workers to staff your business. For those of you new Management Messiahs that are leading the charge here, I have a few questions, observations and answers for you:
- Opinion: Turn core, value-creating roles into contract workers, and you will be selling your soul to pay the number crunchers and analysts.
- Opinion: You cannot sustain any form of business performance excellence with a transient workforce.
- Question: How will you replace that invisible but palpable thing called culture and how will you build a high performance culture around nameless, faceless drones?
- Observation: Once your competitors identify all of the talent that you’ve alienated, it will be open hunting season and you’re what’s for dinner.
- Observation: your global competitors are not foregoing their futures by emphasizing the numbers in the present. A short-term time orientation is a powerful dimension of U.S. business culture and thinking, and it is a weakness.
- Question and Name Calling: Why is this your BEST answer for competing? Is that all you’ve got?
- Double-Dog Dare: Study firms that have made a near religion out of valuing the employee. Start with SAS Institute. There is another way if you have the courage.
- You’ve Been Served: in case “maximizing shareholder value” is driving your decisions, consider Drucker’s rebuke of that modern rationalization for the organization: “the purpose of the firm is to acquire and keep customers.”
The Bottom-Line for Now:
The future of business and any company and perhaps of America is based on finding, cultivating and keeping the best talent. There are no circumstances that I can imagine where shifting core value creation roles to contract workforces will help you succeed in this increasingly complex world. Resist the urge to follow the herd and challenge yourself and your team to focus on solving vexing customer problems and building value in meaningful ways.
Leader, What Are You Doing to Improve Your Value Creation?
Filed under: Leadership, Leadership Skills, Leading Change, Management Education, Management Innovation, Organizational Transformation, Quality Systems Management, voice of the customer
How much value are you creating as a leader?
How much more value can you create?
How are you supporting the ability of your customers (employees) to create value? Where should you improve to strengthen your value creation?
What are your core processes as a leader?
How much waste do you generate through your leadership activities?
Borrowing from the principles espoused in “Lean” these are just a few of the key questions that every leader should ask himself/herself as part of their own personal development initiatives. Unfortunately, in my experience, few if any of these questions are asked or answered either by individuals or their direct leaders. This has to change.
In a world that is begging for radical reinvention of business and leadership practices, the organizations and individuals that are diligent in pursuit of the answers to these and related questions will make it through the storm.
Leadership should be one of the principal value creation components of the management system, yet poor leadership practices often result in increased complexity, added waste and blocked attempts to streamline processes and make improvements that would otherwise benefit the organization and its customers.
One of the key reasons that leaders and leadership practices often fail to create value (or to create more value) is the lack of a common operational and actionable definition for the role of a leader. Another cause is the lack of top management commitment to ensuring that leaders are accountable for ever-increasing contributions to the firm’s value creation mission. I’ll focus on the former in today’s post.
During the course of my career, I’ve developed and leveraged something that I describe as The Leader’s Charter, to help develop other leaders as well as to remind me of my True North as a leader. It reads as follows:
The Leader’s Charter:
Your primary role as a leader is to create an environment that:
•facilitates high individual and team performance against company and industry standards…
•supports innovation in processes, programs and approaches…
•encourages collaboration where necessary for objective achievement…
•promotes the development of your associates in roles that leverage their talents and interests and challenge them to new and greater accomplishments.
As I sit here and think about the Charter’s application and relevance for helping leaders in context of the questions at the top of the post and in light of the world situation, I suspect that it is time for another update. The next update must add specificity to the people development issues covered in the current version, while incorporating all of the primary “value creation” processes that a leader controls and impacts.
I don’t intend on wordsmithing the 2009 version of The Leader’s Charter here in this post, but I will take a stab at identifying a broader universe of areas that leaders must be held accountable for in their roles. I would love your inputs, additions and constructive suggestions via comments or by e-mail.
The Value Creation Processes/Activities of a Leader
- Developing others through coaching, feedback and by encouraging and supporting the pursuit of developmental (stretch) activities.
- Creating a working environment that draws out the collective knowledge and skills of team members in pursuit of solving customer problems.
- Ensuring that the standards for accountability, values, general behavior and communication are understood and adhered to by all participants.
- Clarifying and communicating a Vision that anchors organizational goals and aspirations and gives context to team and individual activities.
- Creating forums to gain ideas and insights into customer issues as part of strategy formulation. Involving everyone in capturing and translating the Voice of the Customer into strategies and actions.
- Ensuring that individuals and teams have the resources they need to carry out their tasks.
- Ensuring that teams and individuals gain access to skills development and educational opportunities.
- Eliminating fear from the workplace (Deming) and replacing it with a focus on customers and improvements.
- Determining what measures contribute to improving understanding and continuous improvement and implementing the systems to monitor and act on these measures.
- Look at the workplace as a system and support the continuous improvement of the entire system. (genesis: Deming.)
It would be easy to keep adding to this list with a series of increasingly granular tasks. My focus is on making this granular enough to be actionable and high-level enough to not be prescriptive.
Let me know your thoughts on other ways/areas that leaders must focus on to create value in their roles and for their organizations.
Is it Time to Panic?
Filed under: Crisis Leadership, Current Affairs, Leadership
I suspect that anyone not concerned about the state of “things” going on in our world and specifically in our economy would reasonably be labeled as naïve. We have big problems, they could get bigger in a hurry or maybe they won’t. The loss of some long-standing financial icons is annoying, the potential for the choking off of access to working capital for otherwise healthy companies is downright disconcerting. The issues being debated in Washington have long-since ceased being about Wall Street and are most squarely about mitigating catastrophic risk on Main Street.
You don’t have to look far for some pundit somewhere offering up the end of life as we know it, usually with comments about a worldwide depression the likes of which we’ve never experienced. Hey, they may be right or they may not. I’ve long since given up trying to peer into the crystal ball and prognosticate beyond the late George Carlin’s famous weatherman bit that called for a forecast of “dark, followed by widely scattered light in the morning.” The sun will rise and it will still be in the east.
In spite of my inability to foretell the future, I do know one thing for certain, it is never good to panic. For you science fiction buffs out there, Frank Herbert had it right when he wrote that, “Fear is the Mind Killer.” Panic creates a fight or flight response, where rational thinking is replaced by instinctual flailing. Individuals panic, participants in markets can panic, and organizations can panic. More often than not, the panic results in dramatic or even fatal mistakes.
Unfortunately, we have recent experience with horrific scenarios. What happened on 9/11 was unthinkable on 9/10. There were no road maps for dealing with the grief and the anger, and for awhile no one understood what was next. It was a time when the best that many could hope for was to process on taking the next breath. In all likelihood, we are still dealing with the ripples of this unthinkable day, and those ripples will likely shape the lives for generations to come in some form and fashion.
In addition to the pundits and talking heads, some really smart people that I know are beginning to let fear creep into panic. Discussions of how to grow, how to compete better and even discussions about the pursuit of excellence are being replaced with focus on retrenching, battening down the hatches and/or boarding up the windows for the storm on the way. Again, we would be naïve to ignore the signs and we would be naïve to think that anyone actually understands the impact of this horrific financial mess unfolding in front of us in real time, albeit drawn out over the past few weeks. It’s time to focus on taking one breath at a time.
While there is some probability that the worst cases will play out, I will place my bet on widely scattered light towards morning. There are many reasons why the world’s global capital markets cannot stop and why the earth’s burgeoning population and the world’s rapidly growing economies will not stop consuming, investing and yes, even growing.
As you look at your own firm and your own situation, it is not a time to take foolish risks. Frankly, it’s never a time to do that, so nothing has changed. It is a time to adopt a philosophy that seeks to find opportunity in chaos. It is a time to carefully evaluate your strategies and check your assumptions. It is also a time to consider making some hard calls on your future. Working for a firm in the post 9/11 world where the board and leadership had the courage to invest in reinventing the firm’s core offerings at a time when our competitors were scaling back R+D efforts, was a brilliant learning lesson.
It’s always time to improve your talent…either by investing in growing their knowledge and capabilities and by culling the herd. It’s a great time to evaluate spending, to hold marketing accountable to genuine measures of value creation and to deploy the best-trained, solutions focused sales force to serve your customers. It’s also a remarkable time to scale up your communications with your stakeholders and with your employees and provide them opportunities to share their many great ideas.
The Bottom-Line for Now:
At the end of the day, people must eat, people must clothe themselves and frankly smart people will figure out how to use the opportunity to challenge themselves and their organizations to improve. The rest will start boarding up the windows to hunker down for a long, agonizing wait. I know which team that I want to be a part of.
We Are All Just Temporary Stewards
My blogging volume is off a bit due to client engagements and teaching activities (a good problem), but I had to take a timeout this afternoon and share some thoughts from a recent discussion. A very thoughtful manager summed up his perspective on his role in the organization as that of a Temporary Steward.
With his permission, and I am paraphrasing: “It’s not our business, it’s not our company, but we have a responsibility to those that will inevitably take over from us to leave the business in the best possible condition.” Thoughtful comments and an interesting way to look at things.
While I suppose you could interpret the Temporary Steward label as a means of rationalizing subpar performance or lack of engagement, for this manager, it was just the opposite. It was clear from our discussion, that he cares very deeply about the organization’s success, about its future state given the changing world that we live in, and importantly, about the people that work in the organization.
From my own perspective, I like the concept of thinking about our tenure as finite. It creates a sense of urgency and it helps us focus on priorities. I’ve observed too many corporate managers that lost track of the fact that they are not guaranteed a job or even that their company will be there next week. Once you start acting like you own the bricks and mortar and the chair and desk that you sit at and even the people that work for you, your judgment clouds, your motivation weakens and your intentions become suspect.
- I’m responsible for contributing more everyday than I take out of the organization.
- I’m accountable to future leaders, managers and employees to do my best to ensure that there is an organization in place for them to contribute to, earn from and to grow.
- I recognize that I am here on the good graces of customers and stakeholders, and I will seek to create value for them every day.
- If I manage people, I’m responsible for doing the heavy lifting and difficult work of providing constant feedback, supporting individual development and eliminating those that can’t perform or that don’t match our values.
- I’m responsible for watching what is going on in the world around us and for helping pick a path to march down. I’m also responsible for recognizing when we’ve chosen the wrong path and helping us change course.
- I won’t take myself so seriously that it causes me to strike out in anger, play politics or spend unproductive time complaining.
- I’ll work hard to recognize when it is my time for my stewardship to end, and I’ll look back on the successes and failures as learning experiences. I’ll leave the regrets for someone else, because as a Temporary Steward, I’ll know that I left everything that I had on the playing field.
The Bottom-Line for Now:
Don’t take yourself so seriously that you start believing that you transcend the organization. Start focusing on what you can do to create value today that will ensure that there is a future for your organization. And remember that you will not pass this way or live this day again. Leave things better than you found them.
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