Tell people they’re inadequate long enough and they’ll believe it. Undermine their confidence with constant correction, tweaking, and complaints and they’ll pull back. Fill people with confidence and they’ll act with boldness.
I’ve been working for the past couple of weeks with the senior management team of a $1 billion industrial company on alignment and performance improvement. It is always insightful to get out from behind a desk and into the real world of business and day-to-day challenges. And here in this situation the challenges of a slow economy, aggressive competition and mature market saturation make performance improvement especially difficult.
But the challenges of the marketplace sometimes pale alongside the challenges inside a company. It is a powerful revelation to see just how great an impact internal policies and processes have on the behaviour of leadership and management, which in turn forms much of the current corporate culture.
While most culture “gurus” and academics focus on vision, values and leadership behaviour as the key elements of corporate culture, they routinely miss an even more powerful driver of culture: internal policies and business practices.
Case in point. Consider a company in a mature market competing with other well established brands for sales of large industrial products. The overall view of both dealers and customers is that this particular company has about the same products as everyone else. Their quality is about the same. Their prices are about the same. But doing business with them is a nightmare!
One of the key reasons has to do with the internal company policies and business practices.
Internal Policies Drive Corporate Culture
Internal policies are either an enabler or a barrier to how effectively managers can engineer the customer experience. Let’s suppose a company has internal policies and business practices that can be classified as micro-management. Such as: all expenditures above $1,000 by an executive having to be approved by corporate finance, who are over 8 time zones away! Or all hiring at the local level having to be approved by corporate HR. All raises, compensation and benefits, and performance reviews having to fit into a global corporate-wide bell-shaped curve. Sound extreme? It’s not uncommon in large global organisations to have such micro-management policies established to protect the company from local abuse or inadvertently doing things that may put the company at undue risk. At corporate level this is reasonable for risk mitigation. For the local organisation trying to improve performance, such delays due to checking with corporate and other barriers to local decision-making slow down response time and impact competitive ability.
And it’s not only the slowness of decision-making. Lack of trust in local leadership and constant second guessing tends to eat away at team motivation and feelings of empowerment and accountability. Corporate leaders often wonder why local management teams lack accountability and commitment when they don’t realize their own policies are often one of the reasons. Second-guess someone often enough and restrict their authority and before long they just wait to be told what they can and cannot do.
Many of the so-called culture consultants would diagnose this a culture of “lack of accountability” and prescribe accountability training workshops. If they looked at root cause analysis the real culprit would be internal policies combined with micro-management from corporate.
A desk is a dangerous place from which to view the world. ~John le Carre
Written and Posted by: John R. Childress
Senior Executive Advisor on Leadership, Culture and Strategy Execution Issues,
Business Author and Advisor to CEOs
Visiting Professor, IE Business School, Madrid
John also writes thriller novels!