Recognize, localize, depolarizeâthese are the secrets to building an organization that can walk and chew gum at the same time.
So where do you start in helping your organization become a master of paradox? Here are some suggestions:
- Be honest about the implicit biases in your organization that skew important trade-offs. Go out of your way to include individuals with countervailing views in important conversations.
- Challenge yourself and others to get better data on the hidden costs of default trade-offs. Donât assume that no data equals no downside.
- If youâre a manager, resist the urge to standardize trade-offs across the organization. Be willing to sacrifice a bit of uniformity for more locally appropriate decisions.
- Never accept an either/or. Think creatively about how you could achieve your goals without sacrificing other equally vital goals.
- Work systematically to equip people with the information and skills they need to make smart trade-offs, and then push those trade-offs down.
- Give frontline teams a genuine P&L, radically reduce the number of KPIs, and hold people accountable for results.
- Even if youâre not the CEO, search for ways to âstop the train.â Question every click of the ratchet that moves power and decision making toward the center.
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Hereâs a simple exercise you can do. Reflect on your actions across the last week or month and ask:
- DID I SUBTLY UNDERMINE A RIVAL? In a bureaucracy, power is zero-sum. When a slot opens up, only one person gets promoted. In the battle to move ahead, itâs tempting to discount the contributions of others, or sow doubts about their integrity or competence.
- DID I HOLD ON TO POWER WHEN I SHOULD HAVE SHARED IT? In a formal hierarchy, itâs the people who make the big decisions who get paid the big bucks. To justify their superior status, managers must be seen to be making the tough calls. This creates a disincentive to share authority.
- DID I PAD A BUDGET REQUEST OR EXAGGERATE A BUSINESS CASE? Resource allocation in a bureaucracy is inflexible and conservative. Budgets often get set a year in advance, and anything that looks risky gets down-rated. Given this, itâs tempting to bid for more resources than you need or overstate the merits of your case.
- DID I FAKE ENTHUSIASM FOR ONE OF MY BOSSâS IDEAS? In a bureaucracy, disagreeing with your boss can be a career-limiting move. Hence, individuals often swallow their reservations rather than risk being seen as disloyal.
5. DID I DISREGARD THE HUMAN COSTS OF A DECISION? If your organization treats people as mere resources, you may be pushed to make decisions that sacrifice trust and relational capital for short-term business gains.
- DID I PLAY IT SAFE WHEN I SHOULD HAVE BEEN BOLD? In a bureaucracy, the penalties for screwing up are often bigger than the penalties for sitting on your hands. Given that, itâs tempting to defend timidity as prudence.
- DID I FAIL TO CHALLENGE A COUNTERPRODUCTIVE POLICY? Itâs easier to whine about a stupid rule than to challenge a senior policy maker. Civil disobedience is never the safest choice, but systems donât change until people take a stand.
- DID I DO LESS THAN I COULD TO FOSTER THE GROWTH OF THOSE WHO WORK FOR ME? As we noted earlier, thereâs often an assumption that âcommodity jobsâ are filled with âcommodity people.â As a result, itâs easy to overlook opportunities to nurture the growth of employees doing mundane jobs.
- DID I FAIL TO CREATE TIME AND SPACE FOR INNOVATION, OR MISS AN OPPORTUNITY TO BACK A PROMISING IDEA? Thereâs not much glory in being an innovation mentor. It takes time and often ends in failure. Itâs easier to keep your head down than to champion a new idea, but the result is inertia and incrementalism.
- DID I FAVOR MY TEAM AT THE EXPENSE OF THE BUSINESS OVERALL? Bureaucracies offer few rewards for sharing scarce resources with other units. Behaving parochially often produces the best personal outcomes, even when itâs suboptimal for the organization at large.
- DID I UNFAIRLY DEFLECT BLAME OR CLAIM CREDIT? In a bureaucracy, performance assessments are typically focused on individuals rather than teams. The goal is to be Teflon when the shit hits the fan and Velcro when plaudits are being handed out. This behavior distorts reputations and misallocates rewards, but itâs the way to win in an individualistic organization.
- DID I SACRIFICE MY VALUES FOR EXPEDIENCY? Bureaucracies value results above all else. If you exceed your targets, no oneâs likely to ask what shortcuts you took. Over time, the bias for outcomes over ethics desensitizes an organization to the moral consequences of its actions.
CONTRARIAN THINKING. If a problemâs been around for a while, it probably canât be cracked with conventional thinking. Seek out the positive deviants, like Nucor and Haier. Borrow ideas from other domains, like biology, startups, and crowdsourcing. Rigorously challenge your deepest assumptions. Do all this, and youâll increase the odds of finding a novel solution.
COMPASSION. People arenât merely skeptical; theyâre cynicalâand with good reason. Everyoneâs fighting their own corner and looking out for their own interests. When asked to help, most people will ask, âWhatâs in it for me?â To jump this hurdle, you have to put others first. When colleagues see you working to understand their needs, when you help them craft their experiments, and ensure they get the credit, theyâll start to trust you. When your compassion shines through, people will take risks with you and pick you up when you fall.
CONNECTIONS. Building a community is the most important thing an activist can do. This is the ultimate multiplier of individual effort. Employees eager to try something new often make the mistake of asking their boss for permission. Usually they get shot down, or win only grudging support. This isnât entirely the managerâs fault. A priori, itâs hard to know whether an underdeveloped idea is brilliant or batty. Since great ideas are rare, the default setting for most managers is to say no. So donât go up, go out. Talk to your peers. Find a few colleagues who will help you build and run an experiment. Itâs easy for a manager to say no to a lone supplicant, but much harder to turn aside a small band of partisans who are passionate about making things better and have already made a start.
Ultimately, there is no perfect place to start and the process isnât linearâyou need to go back and forth between the levels, just as you need to loop back and forth between the five questions in the strategic choice cascade. However, you can use three principles to help the company put together integrated activity systems at multiple organizational levels.â
(Lafley and Martin, âPlaying to Winâ, p.122) â1. Start at the Indivisible Level...
Build activity systems starting at the ground levelâthe point of indivisible activity systems
âand work your way up from there. Why? The capabilities at the indivisible level drive the
ones above.â (Lafley and Martin, âPlaying to Winâ, p.122-123) â2. Add Competitive Advantage to the Level Below...
Activities that donât add value to activity systems below should be minimized, because they destroy value. For example, only if the hair-care category can demonstrate value (from sharing of activities and transfer of skills) that is greater than the financial and
administrative costs that it imposes on Head & Shoulders, Nice ân Easy, Pantene, Herbal
Essences, and so forth, should it exist as a level of aggregation in the corporation. Otherwise, the level should be eliminated.
To make good choices, you need to make sense of the complexity of your environment. The strategy logic flow can point you to the key areas of analysis necessary to generate sustainable competitive advantage. First, look to understand the industry in which you play (or will play), its distinct segments and their relative attractiveness. Without this step, it is all too easy to assume that your map of the world is the only possible map, that the world is unchanging, and that no better possibilities exist. Next, turn to customers. What do channel and end consumers truly want, need, and valueâand how do those needs fit with your current or potential offerings? To answer this question, you will have to dig deepâ engaging in joint value creation with channel partners and seeking a new understanding of end consumers. After customers, the lens turns inward: what are your capabilities and costs relative to the competition? Can you be a differentiator or a cost leader? If not, you will need to rethink your choices. Finally, consider competition; what will your competitors do in the face of your actions? Throughout the thinking process, be open to recasting previous analyses in light of what you learn in a subsequent box. The basic direction of the process is from left to right, but it also has interdependencies that require a more flexible path through it.
Leaders who settle issues too quickly limit their opportunity to grasp the ramifications. One of the most dangerous traps is failing to solicit the input of others on the team. Not only does this mean that you most likely wonât have all the information, but you will be absolutely certain to disenfranchise your colleagues. âIt is close to fatal to decide or pronounce before you listen,â says Henry Schacht. âAnd in crisis situations, I think you exacerbate the problem as opposed to moving towards a sound situation. Even if at the end you come back to exactly the same decision you would have made, how you get there is as important as getting there.