17 Developing a World Class Organization

Today many organizations operate in a global environment and must be world class to survive. Even if your organization doesn't operate in a global environment it should have a goal of being world class for the benefit of its stakeholders. The topics to be discussed for developing a world class organization include:

•        Recruiting to build strengths

•        Achieving low staff turnover

•        Developing your successor

•        Matching people to jobs

•        Managing the manager’s time and helping the workers manage their time

The first three topics are included in this lecture and the third and fourth topics are covered in Lectures 18 -20.

Recruiting to build strengths and Achieving Low Staff Turnover

Your recruiting objectives should be:

•        To “raise the batting average” of the organization

•        To achieve low staff turnover

Your organization deserves a “raise the batting average” objective. (Here the term “batting average” refers to the average capability of the organization so that to raise the batting average means hiring someone with skills and/or experience that exceed the average of the organization.) It leads to a more successful organization and thereby supports all stakeholders. People like working with highly capable people so such people are generally welcomed into the organization, which helps satisfy the new worker’s need for belonginess. People are inspired and often mentored by highly capable people so that highly capable people help lift performance beyond just their own contribution. If everyone is treated fairly and there is a sound career development process there should be few ego problems or career concerns over bringing in people that raise the batting average.

I believe building a world class organization by recruiting exceptional people that strengthen the organization is a superior approach to Jack Welch’s approach of firing those whose performance lowers the batting average of the organization. (Jack Welch, the former CEO of General Electric required his senior managers to get rid of the bottom 10% of their subordinate managers each year.)This is because Welch’s approach promotes competition to survive, which inhibits teamwork and diverts worker’s attention from their job to their survival. This results in a fear environment, which appears to have high performance, but actually has lower performance than the organization is capable of if fear is removed and replaced with an environment of cooperation and commitment.

Let’s now look at why achieving low turnover is important. Let’s take a very conservative example of an organization where the average wage is $25 per hour. The recruiting and orientation training costs for a knowledge worker is typically about equal to one year’s salary. Figure 6 shows the costs for typical turnover rates as a function of the organization size assuming the cost of replacing a worker is equal to one year’s salary.

Figure 6 Annual turnover cost for organizations with turnover rates of 2, 4, or 6%.

The difference between a turnover rate of 2% and 4% for an organization of 100 people is $90,000 per year. That difference is equal to spending $900 per person on training or new software each year. This example is conservative because it ignores the hidden costs related to disruption of work, the diversion of manager’s attention from other critical activities and the diversion of workers attention associated with people leaving and new people being assimilated.

An effective leader has a goal of maintaining turnover close to the limit imposed by retirement, promotions out of the organization and the occasional need to replace a bad worker. This limit is usually between 1 and 2 % and it can be achieved if the managers are truly effective as defined in this course. Turnover rate is also dependent on effective recruiting. A low rate cannot be achieved if an organization is growing and the recruiting process doesn’t add workers that match needs and stay with the organization for the long term 80% of the time or more.

The recruiting process is dependent upon the style of the manager and the culture of the enterprise so I cannot claim to describe the only correct way to recruit. I can however describe a recruiting process that has proven to work and to support low turnover in organizations I have managed.

Example of Effective Recruiting Process

–       Discuss open positions thoroughly with human resources so that they can determine if normal job applicants are likely to fill needs, or if new ads are needed, or if help from professional staffing organizations (headhunters) is required

–       Manager must prescreen resumes provided by human resources to identify high potential candidates

–       Manager or designee should prescreen high potential candidates via phone calls before they are brought in for an interview

–       Does candidate understand job opening and local area?

–       Does the manager receive positive “vibes” from the conversation?

–       Will candidate likely accept if ultimately given offer? (e.g Can the candidate relocate if necessary or does a divorce decree prevent relocation?)

–       After human resources meets the candidate begin the in-house interview with a group interview to cover common questions- this should take 45 - 60 min and involve all workers and managers scheduled to interview the candidate.

–       Responsible manager defines the open job for the candidate and the group so that everyone understands what is expected of the candidate

–       Candidate answers general questions about education, experience, etc. so that these questions are ask and answered only once and everyone hears the same answers

–       Individual meetings with at least four managers and likely coworkers

–       Typically 45 - 60 minutes each

–       Lunch offsite with two or three senior people

–       This is critical as it often leads the candidate to reveal information that would never be provided in formal interviews

–       Hold a group discussion at end of day with all the interviewers to discuss what each has learned in the private interview and make an offer/no offer decision

–       Reach consensus or don’t hire

–       The senior manager must be responsible for preventing the group from only hiring clones of themselves. Diversity of many types is necessary and the group will accept diversity if it is discussed and a consensus is reached

–       Human resources verifies resume (e.g. Claimed education and former employers) and references, works with the manager to determine an appropriate salary and makes formal job offer or informs candidate of rejection

My experience indicates that the group meetings at the beginning and after the interview and the offsite lunch are critical for the reasons explained in the description above. It is also essential that the interviewers not be working in a fear environment. Otherwise they may provide the feedback they think the manager wants rather than being objective and speaking up when they disagree with the manager or each other.

The need for diversity needs further explanation. Here diversity means diversity in thinking and working style as well as diversity of race, gender and national origin. In general, organizations of people that have similar cultural behavior work smoothly but if there is no one to offer different views then the organization tends to be restricted in thinking. Such an organization of cultural clones isn’t as effective as an organization having a few members that provide alternative views that are outside the bounds of the homogeneous culture. Hiring people whose thinking and working style deviate from that of the rest of the organization is always a risk. The wrong person can create dissention and some people just won’t be happy being in a culture different from their own. The objective is to find a few people that are able to work well with the group and yet offer views divergent from the group’s usual thinking.

A key element in recruiting the very best people over the long term is to develop a network of people that are always on the lookout for exceptionally capable young people. The network typically includes people in the organization with a wide circle of friends and associates in other organizations, consultants (particularly university professors), customers, suppliers and others that have the opportunity to interact with young people having the skills needed by your organization. Developing and tending such a network takes time but the payoff is finding the exceptional young people that can lift your organization’s performance to world class levels almost by themselves. Once you have attracted a few exceptional people and provided them a positive environment for their work they attract other exceptional people.

You must be well on your way to developing a highly effective organization in order for people in your skills identification network to feel comfortable in recommending exceptional people to you and for you to be able to recruit such people. If your organization doesn’t have a good reputation then it is difficult to recruit top talent until you have fixed many of the organization’s problems. You can still attract top people by being honest with them, convincing them you have a plan to fix the problems and giving them an incentive to be part of your plan. Don’t settle for less skilled people because your organization has problems; work harder to attract top people that become part of the solution.

Developing your successor

Demonstrating effective leadership of a successful organization is one ingredient in preparing yourself for promotion to more responsible positions. Another is having an obvious successor so that your current organization can continue to be successful if you move on. An effective leader is proactive and prepares a successor so that it is apparent to others that the candidate is ready. A way to accomplish this is to give the candidate leadership tasks once you are convinced they are ready and can succeed in leadership tasks.

You can develop a successor via recruiting, mentoring or the natural maturation of one of your subordinates. The path isn’t important unless the culture of your enterprise favors one path over another, e.g. some cultures prefer to promote only from within. If your enterprises has such a culture and you recruit your successor you must be prepared to mentor this person for the time it takes for the new person to be considered eligible for promotion.

The most important advice I can give from my experience is to make sure the person you pick is as capable of managing your organization as you, or preferably more capable than you. Giving your candidate leadership tasks enable you and others to evaluate the candidate’s capabilities and readiness for promotion. If the candidate fails to meet your expectations in two or more such assignments then review both the assignments and your assessment of the candidate’s capabilities. If the assignments were reasonable and if you decide the candidate was as well prepared as he or she is likely to be then you must pick a new candidate and prepare them. Do not compromise in hopes that the candidate will grow into the job after promotion. Whereas that might happen you shouldn’t count on it. Remember that the failure was failure of your judgment so do not punish the candidate.

Exercise

1.     Without looking forward, write a list of what is necessary for achieving a low turnover rate besides an effective recruiting process.

2.     Develop a mathematical model to define the time required to recruit a new employee in your group. Your model should include time for deciding a new employee is needed, preparing, submitting and defending a requisition to hire, discussions with the Human Resources people before they begin collecting resumes, screening resumes, phone interviews, on site interviews, post offer discussion with the candidate and orienting the new hire once on board. Assume percentages for resume screening, other screening steps and offer acceptance rates appropriate with your experience.

3.     Assume an organization of 100 people and a growth rate of 15%. Run your model to determine how much time is required of top managers to grow their organizations by 15% per year.

4.     Review your staff for candidates to succeed you. If one, or hopefully more than one, is available then begin to develop a mentoring plan to prepare the candidate(s) for your job. If none are available then look for the opportunity to recruit a candidate.

Discussion of Exercises

If your experience with the time it takes to be effective at the various steps in recruiting is similar to mine you will have learned from exercises 2 and 3 that growing an organization effectively takes a surprising amount of time. Inexperienced mangers often fail to allocate enough time for recruiting and end up chronically understaffed for much longer than necessary. In addition such failure can lead to an organization not achieving the growth it could because there simply isn’t enough staff to execute the work. If you have subordinate managers you must make sure they are spending the time necessary for effective recruiting if your organization is growing. Most mangers don’t like recruiting as well as their other work and their other work always seems more time critical so they tend to put off recruiting.

Your model also likely predicts that there is a limit to the growth rate that can be accomplished and still have time to execute other required work. Watch what happens when a new hot shot CEO announces that his or her enterprise is going to double in three to five years. Often such a strategy causes the enterprise to implode. There simply isn’t enough time for the employees to win new business, execute the high quality work that enables growth and develop the staff fast enough to handle work well. (Exceptions occur in business areas that are very new and therefore can tolerate growth problems better than a highly competitive established business.)

Your answer to exercise 1 should have included such statements as:

Satisfy Maslow needs

Fair salaries, Security, Fair treatment, Help belong to team

Opportunity for self-esteem and self-actualization

Career development that is constructive and meaningful

 Managers that “removes rocks from path” so workers can do their jobs     (“Rocks” include poor processes, defective equipment and oppressive policies and procedures)

Low Fear environment

Effective Time management; e.g. no long, non-productive meetings

If so, you successfully understand this part of the training.

  

If you find that the pace of blog posts isn’t compatible with the pace you  would like to maintain in studying this material you can buy the book “The Manager’s Guide for Effective Leadership” at:

http://www.amazon.com/Managers-Guide-Effective-Leadership-Organizations/dp/1449000673/ref=sr_1_2?ie=UTF8&qid=1346946310&sr=8-2&keywords=Joe+Jenney

or hard copy or for nook at:

http://www.barnesandnoble.com/s/Joe-Jenney?keyword=Joe+Jenney&store=book

or hard copy or E-book at:

http://bookstore.authorhouse.com/Products/SKU-000269270/The-Managers-Guide-for-Effective-Leadership.aspx

Review of Lectures 11-16

We observed three lessons from the discussion of the “lost on the moon” exercise in lecture 11:

·       Teamwork in more effective than individual efforts in solving complex problems.

·       Effective teamwork doesn't just happen by assigning people to a team. It’s important that they are trained or mentored in how to work together in a way that utilizes the best knowledge and skills of each team member.

·       People must be in job assignments that match their styles. Not every worker does well on a team; some are best as individual contributors.

There were two messages in our brief review of Stephan Covey’s teachings on habit 5 from the The 7 Habits of Highly Successful People in lecture 12. We learned that if we expect people to listen to our logical arguments we must first establish our credibility with them, and second, we must listen empathically to them until they are convinced we understand their concerns and problems. Only if they are provided evidence that we are someone they should listen to and only if they believe we understand their situation will they listen effectively to us. The hardest part for most people is listening empathically. Effective managers must learn this habit and use it with their workers, their bosses and the customers for their work.

Lectures 13-16 addressed fear in the workplace. Key points included:

•        Fear of perceived consequences (real or not) causes workers to avoid proper actions and substitute inappropriate or ineffective actions.

•        Managers induce fear by negativity, disloyalty to their boss or to the enterprise and excessive emphasis on numerical goals.

•        Oppressive policies and procedures written in attempts to control the behavior of the 5% of workers that cause problems are counterproductive. They cause fear and distrust in the many good workers and don’t deter the few problem workers.

•        A poor business environment can induce fear; counter this fear with openness and honesty.

•        Blaming people for problems caused by the system induces fear

–       Remember the 85/15 rule. Problems are caused by the system 85% of the time and by people only 15% of the time.

•        Managers that focus on fixing the system and seeking help from workers without expressing negativity build trust and reduce fear.

•        Energy spent on issues you can influence is positive and grows your circle of influence. Energy spent on issues you can’t influence is negative and shrinks your circle of influence.

•        Fear of change and of knowledge are inherent fears. Managers have to deal with both and must learn to help workers overcome fear of change.

•        Cultural change requires patience, persistence and typically training time of about 10% of the total annual hours worked by the organization.

Exercise

You last reviewed and modified your action plan at the end of Lecture 13. Review your plan after studying the review of lectures 13- 16. Are there changes or additions you should make based on what you have learned in lectures 14 - 16? If so, make the changes now.

If you find that the pace of blog posts isn’t compatible with the pace you  would like to maintain in studying this material you can buy the book “The Manager’s Guide for Effective Leadership” at:

http://www.amazon.com/Managers-Guide-Effective-Leadership-Organizations/dp/1449000673/ref=sr_1_2?ie=UTF8&qid=1346946310&sr=8-2&keywords=Joe+Jenney

or hard copy or for nook at:

http://www.barnesandnoble.com/s/Joe-Jenney?keyword=Joe+Jenney&store=book

or hard copy or E-book at:

http://bookstore.authorhouse.com/Products/SKU-000269270/The-Managers-Guide-for-Effective-Leadership.aspx

16 Fear of Knowledge and Fear of Change

We have addressed all the topics on fear except fear of knowledge and fear of change. These two fears are treated together and separate from the others because they are inherent in the personality of people and not caused by either the manager’s behavior or by organizational culture. This is a short lecture so I’ll follow it with a review and work on your action plan.

Henry Ford is credited with saying “Anyone who stops learning is old, whether at 20 or 80. Anyone who keeps learning stays young. The greatest thing in life is to keep your mind young.”  Unfortunately fear of knowledge is an inherent fear. You can recognize it from comments made by workers that sound like the following:

•        “I can’t go to class, I’ll appear too ignorant”

•        “I’m retiring in (1,2,3..) years. Why should I learn this crap?”

•        “I already know how to do it!”

•        “What? Learn this? Why, then, I’ll have more responsibility!”

Well, they may not explicitly say the last part of the first and last statements but it is what they are thinking.

Fear of knowledge is a challenge for the manager. Workers must retrain themselves more and more often during their careers due to more and more rapid advances in technology. Managers must make this clear and that retraining is expected as part of the job and is a required skill for nearly any job. Peter Senge, in his book The Fifth Discipline says that the only advantage an organization can sustain is the capability to learn faster than its competitors.

Workers must overcome their inherent fear. Even retirement does not relieve them of the necessity to continually learn due to the rapid change of technology used in daily life. The effective manager can help workers overcome their inherent fear of knowledge by listening to their excuses (listening with empathy), being sympathetic but firm in the requirement that they participate in training when necessary and offering to help if needed. However, if you have done these positive things and still have a worker whose fear of knowledge is preventing the worker from keeping up with required training and/or technology change you should look for another assignment for that worker. A manager is not required to be a psychologist.

Is change happening often in your organization? In today’s work environment your organization is the exception if change isn't happening often. To mitigate the damage to organizational effectiveness from fear of change you need to understand that people react to change differently. Some relish change, some fear change, some move out before having a plan, some are immobile until every detail of the plan is explained. This is another example of where the effective manager must treat workers as individuals. People’s response to change can be explained by their personality type from Myers/Briggs or similar personality tests. These tests are helpful in that they explain why people react the way they do and help the manager realize that some workers are not just being arbitrarily difficult, it’s inherent in their nature and they must be treated as individuals to help them overcome their fear of change.

There are some excellent books on managing change and it is worthwhile to own and periodically reread at least one of them. For example try one or more of the three books cited in lecture 4 and Who Moved My Cheese: An Amazing Way to Deal with Change in Your Work and in Your Life by Spencer Johnson and Kenneth Blanchard. If you have workers that are exhibiting fear of change recommend that they read Who Moved My Cheese or Our Iceberg is Melting.

People’s fear of change and fear of knowledge are primary reasons why changing an organization’s culture is so hard and fails so often. As cited in lecture 4 research has shown that successful cultural change requires investment of about 10% of the total annual hours for an organization. A rule of thumb is that management must spend 2% of payroll per year for 5 years to successfully change an organization’s culture. (I am assuming here that an hour of time costs an hour of pay.) This is the reason many management fads and quick fixes to organizational problems don’t work. Even if the approach is fundamentally sound organizations typically don’t spend the required time, energy or money to make a successful cultural change.

Managers succeed with change by taking small steps so they don’t create chaos in the organization, by working through the details of each step and having the persistence to overcome mistakes and errors of judgment (get help from experts if possible). Managers that seek too big of a change in a single step or too many changes at the same time risk throwing the organization into instability and collapse. It is better to limit change to a series of relatively small steps so that everyone that needs to change clearly understands each step and has time to adapt. The keys to success are commitment, patience, persistence and having the top manager lead the change by example.

A reminder; what you are trying accomplish with the aid of this self training is to change the culture of your organization so that it will be dramatically more effective. Don’t expect to be successful without investing several years and the time equivalent of 10% of the annual hours of your organization in training your people. Make sure you lead any necessary changes. It is a lot of effort but when you are successful you will realize a 20% or more increase in effectiveness year after year. This is a very satisfactory return on investment. If you are committed, patient and persistent than you can succeed within the limits of the organizational culture that you can influence.

  

If you find that the pace of blog posts isn't compatible with the pace you  would like to maintain in studying this material you can buy the book “The Manager’s Guide for Effective Leadership” at:

http://www.amazon.com/Managers-Guide-Effective-Leadership-Organizations/dp/1449000673/ref=sr_1_2?ie=UTF8&qid=1346946310&sr=8-2&keywords=Joe+Jenney

or hard copy or for nook at:

http://www.barnesandnoble.com/s/Joe-Jenney?keyword=Joe+Jenney&store=book

or hard copy or E-book at:

http://bookstore.authorhouse.com/Products/SKU-000269270/The-Managers-Guide-for-Effective-Leadership.aspx

15 Effective Organizational Polices

Just like numerical goals there are good and bad policies and policies affect the motivation of workers. Bad policies are demotivating just like bad goals. Good and bad policies are described and examples of each are presented in this lecture.

Organizational polices are unfortunately one of those necessary things for which doing everything right only gets you to a neutral position with respect to motivating people but bad organizational policies can destroy trust and induce fear. This means that fixing bad policies can improve the organizations effectiveness by removing the source of some of the mistrust and fear that cause ineffectiveness. However, creating the world’s best policy won’t do any more for effectiveness that an adequate policy that workers trust and believe is fair. Therefore we want to concentrate on identifying and fixing bad policies because they are a form of negativity.

How do we identify bad policies? There are a couple of easy clues. Policies written for the 5% of employees that cause problems are rarely effective with the 5% and usually alienate the 95% of employees that are excellent workers, with the result that the productivity of the 95% is reduced.  This is because the 5% that cause problems are almost professional problem causers. They ignore polices, either good ones or bad ones. They typically don’t even consider policies or treat them as if they are for others but not them. Some of these problem people treat bad policies as a challenge to be overcome.

Managers have to deal directly with the 5% that are problem causers, typically this means getting them out of the organization as they don’t usually respond well to direct oversight or corrective action. Remember the other 95% expects you, as the manager, to deal with these problem causers and they expect you to change or get rid of problem people as long as you are fair about it. This means giving them the chance to change, but firing them if they don’t. If a manager doesn’t deal directly with problem people then the manager loses the respect of the 95% and effectiveness is reduced.

Policies written for the 5% reduce effectiveness of the 95% because the 95% see such policies as written for them as well as the 5% and they reason that management has such policies because management doesn’t trust them. They resent not being trusted and question whether they should trust management. This resentment takes energy that should be directed toward productive work.

The second tip off to bad policies is that bad policies are typically long, complex and often punishing. Why? Because they are intended to thwart people that abuse simple policies, i.e. the 5%. It takes time away from more important job functions for good employees to learn and comply with long, complex and punishing policies. Such policies convey that the organization does not trust the employee. For good reason because usually such policies are written by managers who don’t trust employees. Recall that good employees feel that if the organization does not trust them then probably they should not trust the organization. If there is not an environment of trust then there is not an environment of high effectiveness.

Managers can’t fix this perception of mistrust caused by bad policies by telling the “good” workers that the policies don’t apply to them but only to “bad” workers. Policies are necessary in any organization to provide guidelines fair to all so this approach requires two sets of policies, either two formal sets or a formal set and a set applied at the managers discretion. It is far better to have a set of policies written for the 95%. The fact that policies written for the 95% won’t work for the 5% is immaterial, no policies will work for 5% except those that enable managers to remove people.

Some will argue that the bad policies are necessary; otherwise it would be impossible to control the bad employees and fire them without data in their personnel records. This is a misconception. Data in personnel files is almost never of any aid in dealing with problem employees. In my personal experience I have had to deal with numerous bad employees, typically left in place by previous ineffective managers. I don’t recall ever finding anything useful in any of these people’s personnel files. It was always necessary to build the case for dismissal from scratch and good policies were just as effective in eliminating such employees as bad policies.

At this point I must remind the student to not be hasty in judging whether an employee is a “bad” employee. Don’t make judgments on the basis of one assignment or one mistake. Be patient, if behavior is repeated over and over then the manager can be sure of making the right decision. Note that the manager must not act too hastily but must not let problem people continue to cause problems. It is better to wait a little too long than to act too hastily. People are forgiving if you take a little too long but they are not forgiving if they think you have removed a “good” person by mistake.

Now let’s examine examples of bad and good policies:

Bad Policy

If an employee is absent, arrives late or leaves early without permission of the employee’s manager more than twice then the manager must file a form 13 with the personnel department. If three form 13s are filed then the employee must be referred to the personnel department for counseling.

If an employee needs time off for personal business then the employee must notify the manager a full day ahead. The equivalent of two days per year is allowed with pay if the manager is notified at least a full day ahead. Violation of this policy will result in no pay for time away from the job.

Better Policy

Notify your manager as far in advance as you can if you need time off for personal business or know you are going to be late or absent so that the manager can plan work a rounds for your work.

Bad Policy

Employees may take off the funeral day and up to two other consecutive days off for deaths in the immediate family. An employee’s immediate family is considered, spouse, children, parents, grandparents, brothers and sisters, step-parents, son-in-laws, daughter-in-laws and parents, grandparents and siblings of the spouse. The personnel department may require verification of death if the employee takes time off for more than two funerals in one year.

Better Policy

Make arrangements with your manager as early as possible if you require time off to attend the funeral of a family member or close friend.

I have read that organizations that have changed from “Bad Policies” to “Better Policies” have found that time away from the job decreases. Why do you think this happens? The reason is that the better policies foster trust and trust leads to commitment so that the employees take off no more time than they need. Bad policies build distrust and undermine commitment so that employees are likely to take the maximum time off permitted.

Exercise

Review your organization’s policies on bereavement, personal time off and absences from the job.

If your organization has good policies then you are fortunate because this will help you build an effective organization. If the polices are bad and you have the power to make changes then make changing the bad policies part of your personal process improvement efforts. If the policies are bad and you have no influence on them you are almost stuck. You cannot disown the bad polices as that is a form of back stabbing and disloyalty to your organization, which is a form of negativism that you must avoid. However, if your style enables people to bring their problems to you then when one of the bad policies causes one of your workers severe problems they are likely to tell you. You can work with the worker and the human relations people to see if in such a case there is a solution that helps the employee and is still fair to all. If you make a sincere attempt to understand the worker’s situation and if you make a sincere attempt to find a fair solution without badmouthing the bad policy, or the human relations people if no solution can be found, then you are building trust and your time spent is worthwhile.

If you find that the pace of blog posts isn’t compatible with the pace you  would like to maintain in studying this material you can buy the book “The Manager’s Guide for Effective Leadership” at:

http://www.amazon.com/Managers-Guide-Effective-Leadership-Organizations/dp/1449000673/ref=sr_1_2?ie=UTF8&qid=1346946310&sr=8-2&keywords=Joe+Jenney

or hard copy or for nook at:

http://www.barnesandnoble.com/s/Joe-Jenney?keyword=Joe+Jenney&store=book

or hard copy or E-book at:

http://bookstore.authorhouse.com/Products/SKU-000269270/The-Managers-Guide-for-Effective-Leadership.aspx

14 Managing without Inducing Fear

This lecture introduces a better way to manage than blaming people for the manager’s problems.

Every manager has problems and there is a right and wrong way to react to them. The wrong way is to see people as the cause of the problems and expressing negativity. The right way is to treat problems as the food for improvements; cost reductions and productivity increases. If you are reacting the wrong way then the corrective actions are first, practice and reinforce for others “not expressing negativity”, and second, involve your people in process improvement. If your organization is already involved in a quality improvement program, such as Six Sigma, then you should know how to involve your people in process improvement. If not then work on the first step for now and we will get to process improvement training later.

To understand why blaming people is wrong and improving processes is right we need to review what is called the “85/15 rule”. This is one of those rules that have resulted from the experience of many managers over a long time and is a fundamental basis for process improvement efforts. This rule says that 85% of problems are due to the system, not the people in the system. Therefore managers that blame people for problems are wrong 85% of the time. This induces fear and lowers the organization’s effectiveness. Managers that blame the system and attempt to improve the system are right 85% of the time; an excellent “batting average” in problem solving for managers. Remember that the system is the manager’s responsibility even though workers may own the process involved. Only after there is a fully trained, empowered and experienced workforce can the manager relinquish some responsibility for improving the system.

A way to test how well you are progressing in handling problems is to evaluate your degree of enlightenment as a manager when problems arise. The higher you are on the following list the higher your enlightenment is in reacting to problems.

•        Changes system (high enlightenment)

•        Blames no one

•        Blames himself or herself

•        Blames other(s) (low enlightenment)

The flow chart in figure 5 below shows that if a manager reacts properly the reaction creates a positive feedback, making it easier to handle future problems.

 Figure 5. A process for managing problems without inducing fear in individual contributors.

An effective manager follows the process outlined in Figure 5 when problems occur. First the manager avoids blaming people, i.e. expressing negativity, and instead questions whether the system needs to be changed. Even if the problem arose due to a mistake of a worker the manager should question whether the system can be changed so that the same mistake won’t happen again or so that the workers job is easier and less prone to result in mistakes. Typically, the problem is associated with a process owned by a subordinate so the manager should seek help and information from the subordinate. The details and tools associated with process improvement are covered later but it is always better to have the process owner involved in changing the process than having a manager do the work. Effective process improvement focuses on the process, not the people, and bases decisions on data rather than gut feel or intuition if at all possible.

The process described in Figure 5 results in happier workers because they don’t get blamed for problems and managers demonstrate that they care enough to get involved and help fix the system. This builds respect for managers, commitment to organizations and improves motivation of workers.

Exercise

1.     Review problems faced in your organization over the past few months

2.     Try to recall if you expressed any form of negativity. Think of specific incidents where:

a.      You blamed people for a problem that may have been a system problem

b.     You blamed the boss

c.      You blamed yourself

3.     Write down a better way you could have handled each incident

4.     Now review the corrections to your action plan that you made after Lecture 13. Does your plan include changing your approach to problem solving in a way that raises your problem solving batting average and does not induce fear in your organization. If so proceed with implementing the changes you have added to your plan.

If your analysis says you have habits that may be inducing fear you should change your behavior. This is about the most difficult thing for anyone to do (change behavior). Changing what we do is easy in comparison to changing how we behave. First, we must be honest with ourselves and want to change. Then we must know how to change. The key at this point is to avoid inducing fear, which undermines the organizations effectiveness and our effectiveness as a manager.

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