In the past I’ve been in several organizations (businesses, in my case) where management has a sense that something isn’t quite right, and that they have to do something about it. Often these kinds of problems can manifest in morale, in productivity and in the ability of staff to make good decisions and execute effectively.
Unfortunately, the frequent reaction of management is to attack a particular aspect of the organization, assuming that all of its problems can be addressed in this single space. They will decide “we need to improve our processes” and focus exclusively on that. Or maybe they decide that if they can only hire the right people, all of their problems will magically vanish.
The truth is that organizations are powered by an ecosystem of forces that interact with each other. Good management examines the entire ecosystem, making tweaks (or sometimes wholesale changes) within to address the problem. Good management knows that there is more than one type of adjustment to make, however.
The Forces at Work
As I mentioned above, a number of forces affect the organization:
Organizations, like Soylent Green, are made of people. The competency, character and societal culture of those people will clearly affect the organization in all sorts of interesting ways.
Generally I divide “people issues” into two categories: the first is what people bring through the door with them – their mannerisms, how they work with others, how they react under stress and so forth. The second category has to do with how well they fit with their role within the organization.
On the “through the door” side, these issues are well covered by the studies of psychology and sociology. The best hope is for management to become sensitive to these kinds of issues, and encourage a productive environment. Frankly, this is an opportunity for strong leadership – management can encourage people to act in a certain way (I’m a proponent of “nice”, for example) by setting the tone themselves.
It should be understood, however, that people’s personalities are what they are – and that they’re unlikely to change for the organization’s sake. If you can make this work with your organization, great. If not, well, don’t expect to be able to correct it. If you can’t live with it, that person probably needs to go.
The role aspect has a fair amount more play. The essence of employment is that its an agreement by a person (the employee) to fulfill a role defined by the employer. How well that role is fulfilled is the success of the employment.
Sometimes what is at first glace a problem with a person, is actually a problem with the person’s fit for their role, or the definition of the role itself. For example, if a role has an unusually high turn-over rate, it may be that there are other issues at stake. A position that no one can fill is worthless.
Issues in the “role-fit” category can often be addressed by adjusting the role. This doesn’t have to be negative: sometimes the action is to expand the role – increasing the person’s responsibility. Sometimes (often) some degree of lateral movement is required. Often a role organically changes under a person and becomes a poor fit, even though it originally was a good one.
A lot of consultants make a lot of money in this area, because process adjustments are relatively easy to define and execute, at least in comparison to some of the other dimensions in the ecosystem. Again – process isn’t everything. It’s one dimension of the organization, and while it can be incredibly powerful as an agent of change, to focus on it in exclusion of the other dimensions is to hold an incomplete understanding of the organization’s health.
Process, or “how we as an organization repeatably do things” is part of the day-to-day structure of the organization. It intersects with roles, systems (automated or not) and defines the day for many members of the organization.
There are three big ideas to understand about organizational process:
- Process has weight: Every procedure, every form, every mandatory meeting and so forth places a little (or in some cases, a lot) of additional load on an organization. This weight adds up. Process weight can have the very serious consequence of adding drag to the organization – slowing it down, preventing it from executing on things that are actually important to the business. This is typically the situation that people describe in large organizations, and is what they seek to escape by fleeing to small organizations.It is important to understand that processes don’t come for free. Every time a new process is added, the drag on the organization increases. For this reason, management needs to ask itself if the new process is worth it – are they buying enough of a benefit to justify the drag. Also, they should question how much drag they are adding, and if there is an alternative that could be implemented in a lighter, more efficient method.
- Processes need to be refactored. No matter how good an idea it seems out the gate, any process can stand to be improved. (And sometimes replaced, or just scrapped.) The strongest organizations provide mechanisms by which people who live with the processes on a day-to-day basis can report on how they’re working, and submit ideas for how they can be improved. Then, the organizations actually act on those suggestions. ”Dinosaur” organizations occur when the organization is not capable of change – either through lack of willingness or ability to execute a change. Dinosaur organizations become weaker and weaker over time.
- Process requirements change with organization scale: If you are in an organization that is changing size, there’s an additional factor: what worked when you were ten people fails when you are thirty. What works at thirty fails at 100. Scaling is the phenomenon of processes breaking repeatedly. If you are in a scaling organization expect process to break more frequently, and that you will need to refactor the way you do things.
Here’s one that often get’s missed: if you are in a bad business – if you are unable to make money (or otherwise succeed in a non-business organization), things are going to be bad no matter how many amazing people or awesome processes you have. There needs to be a business engine that keeps everything going, or you have nothing.
This third pillar can often be the limitation for many great operational people who know the ins and outs of scaling a business, but don’t operate well at the actual layer of the business itself. Why does it work? The business model, the marketing, the various outward-facing ingredients that determine the success or failure of the organization in the marketplace, these simply cannot be ignored when thinking of the overall health of the organization.
As a personal example, I spent a while trying to build a startup focussed on the music industry at the exact same time the music industry was going through its existential collapse. (From Napster to iTunes, basically). I had tons of great ideas for how to scale the business from a personnel and process perspective, but the underlying quality of the business wasn’t strong enough to support it. So it didn’t work out.
Leadership and Culture
The final two dimensions are less of pillars and more of the medium through which quality spreads through an organization. You can think of them as magnetic poles, because they interact with each other and make things happen.
Leadership comes from the people at the top: the founders or top management. Leadership obviously defines a great amount of strategic and executional aspects of an organization, but additionally, leadership defines the original culture of a company (often subconsciously).
Over time, through hiring and firing practices, and internal interactions, leadership creates the culture of the company. If leadership acts unethically, it will become part of the company culture that unethical behavior is acceptable, and in turn the company will attract unethical people. For all aspects of culture this is true: drama begats drama, creativity begats creativity, hostility begats hostility and so forth.
In a future post I’ll start having a look at treating organizational issues in a holistic manner, by applying this model to understand where problems intersect, instead of approaching issues exclusively from a single dimension.