In today’s world of rapid advancements in technology, some of the basic truths of business effectiveness and sustainability seem to have been forgotten as we embrace the belief that technology will solve everything. The current belief among business leaders is that the road to business success and productivity is paved with technology.
But a business is a complex system and technology is just one aspect of the system, along with company policies, work processes, quality control, testing, and of course people doing work.
It is my experience, after 35 years of working with and studying business performance, that the internal system (the rules and processes that govern the flow of work) has a much greater impact on human performance, human behaviour, and the culture of the organization than most people realize.
The brilliant management sage, W. Edwards Deming says it much better:
The supposition is prevalent the world over that there would be no problems in production or service if only our production workers would do their jobs in the way that they were taught. Pleasant dreams. The workers are handicapped by the system, and the system belongs to the management.
The system determines the culture, and leadership establishes the system.
The Real Role of Leadership
Much attention over the past several decades has focused on the role of leaders in motivating people, providing a compelling vision, leading and role modeling values, and Management by Walking Around. All good stuff. But unless the system supports productive behaviours and attitudes, coaching, mentoring and motivating will lead to frustration rather than improvement.
The real job of leadership is to change the system (policies and work processes) to make it easier for people to deliver performance. The system determines the culture (how things are done around here), and leadership establishes the system.
Here’s an easy example. The executives of a retail company noticed that customer satisfaction scores were falling, so they called on HR to ramp up staff training. “Get people to focus more on customers” was the battle cry across the region. Much money and time was spent on training, with absolutely no positive impact on customer satisfaction scores.
Stepping back to look at the entire company as a system of policies and work practices beyond just sales staff, we discovered the real driver behind the falling customer satisfaction scores. At a certain time twice a day, the senior managers in charge of inventory and merchandising demanded that all people on the sales floor fill out the latest inventory templates and send them up to head office. The buyers and merchandise heads needed to make buying decisions and the numbers were critical.
When we spoke with sales staff about the poor customer service scores they said that the time taken away from helping customers to do the inventory paperwork and reporting was a major issue. But in this company “system”, the merchandise function (buyers and senior merchandise executives) was seen as the most powerful part of the company. The system was designed to satisfy the needs of the merchandising function, not the customer.
The leaders of the company determine the elements of the system, and they are the only ones who can change it. That’s the real job of leadership.
Fortunately in this example the CEO and President got together, realized the negative impact the system of merchandising checks was having on sales and service, and with the support of the entire senior team developed an alternative set of processes that got merchandising its requirements while also freeing up more time for sales staff to interact with customers.
Change the system, change the culture!
And only the leaders can change the system, if they have the courage.
Written and Posted by: John R. Childress
Senior Executive Advisor on Leadership, Culture and Strategy Execution Issues,
Business Author and Advisor to CEOs
John also writes thriller novels