If one goes into any discussion about management habits and practices, typically there is a chorus from everyone about the lack of effective management within their organizations. Much of this complaint has good cause because in many organizations, management fails to have the fundamental qualities necessary to build confidence in their decisions. Even when successful, there is a thread of doubt and criticism that permeates the organization.
An organization can be one of two things: It can be breaking down within or it can be looking outward to achieve goals together. Many organizations do not have the fundamentals in place to transition from the first stage and move on to the next. There are “negative energies” that keep the company sliding or prevent it from reaching the next milestone, in spite of having the physical resources and talents to be able to make the transition.
These fundamentals of an organization are termed the “hygiene factor” (a term first coined by Frederick Herzberg) in the sense that similar to cleanliness, a person (or in this case, an organization) cannot do without them. But they are not only the only thing – an organization must have other traits for success. Mazlow’s hierarchy of needs is an example of this. Unless the fundamentals are taken care of, the next level of needs and achievements are difficult to envision, let alone come by.
An example of missing fundamentals is the lack of openness and candor within organizations. Many organizations maintain secrecy about their operations, decisions and management. Sometimes this is done to maintain the power hierarchy within the organization. In many other occasions, the company doesn’t have the systems or processes to effectively obtain and circulate information to its employees.
Manifestations of such lack of candor include poor performance appraisal systems where mediocrity is passed over or even rewarded. Negative energy builds up within the organizations as some employees are working harder to compensate for the weaknesses of others. The lack of attention to quality and results finally leads to brutal decisions like layoffs.
In a closed culture, employees and management are separate, by definition. There is no mutual aligning of goals. There is no clarification or indication of what is wrong and such organizations, for example, Enron and Tyco, quickly fall prey to dysfunction in many forms including corruption. An open culture builds trust. It allows an employee to understand the extent of how his or her actions are contributing to the success of the organization by providing a live scorecard.
What organizations need to do is to first identify and eliminate the negative energies within the organization that neutralize the positive energies that would take the company forward. This is the example of the “First Take the Wrong People off the Bus” (Jim Collins, “Good to Great”).
But it is not JUST people. It is also processes, systems and culture – anything that can interfere with the free flow of ideas, achievement and success in the company. Once companies start doing that, they are now at Level Zero, from which they can start implementing good processes that will start bringing in benefits.