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There are a few myths the contemporary management consulting crowd has championed in recent years. Forget the Four Horsemen of the Apocalypse. We're talking more like the Four Unicorns of Utopia, galloping along on rainbows.

The belief in these happy beasts has grown within our organizations because well-intentioned experts have been trying to bring about massive social change by preaching a kinder, gentler form of management. But if we want to have a true understanding of what effective, successful leadership looks like in the clutch, we need to look anew at these animals in as sober a fashion as possible.

Unicorn #1: Leaders who are highly collaborative get better results than leaders who are less collaborative.

Reality: The biggest business icons of our time aren’t well-known for soliciting colleagues’ input. They’re more known for telling workers, “Look, I need you to reach the goal that I’ve established for you—and I need you to reach it faster than you say you can.”

Now I’m all for collaboration, and I do believe that collaborative and democratic processes can create healthier organizations in some cases. But let’s also be honest: collaboration is simply not a non-negotiable for effective leadership.

Leaders who try too hard to be highly collaborative often get stalemated by bureaucracy, rivalries and disagreements. But their more hard-charging counterparts have an intuitive sense of “true north” that allows them to navigate past those stalemates and squabbles.

Unicorn #2: Any dilemma or crisis can be resolved through “win-win” thinking.

Reality: Sometimes you have to make painful decisions for the larger good. Sometimes you just gotta lay off 20% of the workforce so that 100% of the workforce doesn’t end up on the street.

Unicorn #4: A happy, healthy person will make a great leader.

Reality: Most effective leaders aren’t happy, well-balanced people, whether they go on to be seen as saints or scoundrels. The lack of balance is precisely what drives them to do exceptional things.

Many experts today insist that great leaders have “emotional intelligence.” Such leaders are supposed to be rocks of emotional health—they’re compassionate, they're not hampered by negative feelings, and so on.

But these leaders may be like unicorns. Where exactly are these people?

Steve Tobak, a fairly contrarian management consultant, has refuted the notion that emotional intelligence is essential. “Consider some of the most highly accomplished entrepreneurs of our time: Steve Jobs, Bill Gates, Andy Grove, Larry Ellison, Larry Page, Mark Zuckerberg and Elon Musk,” Tobak recently wrote. “I’d be surprised to find an ounce of emotional intelligence among them.”

Often the leader succeeds simply because she’s more driven, more clever or smarter than others. And, as I noted a few days ago, oftentimes leaders triumph, not because they’re good people, but because good people quietly work for them behind the scenes, to patch leaks in the ship while their captains grandstand on the main deck.

Don’t get me wrong, I think becoming a happy and healthy person is perhaps the most important thing we can do for ourselves and for our world. But as psychologist Laura Harbert, a longtime friend and colleague, has pointed out, happy people put in an honest day’s work and then go home and throw the ball around with the kid. It’s the unhappy people who fanatically stay at work, seeking some way to put their imprint on their world. Yes, it’s the unhappy people who are willing to do whatever it takes to be big-time leaders.

So which one would you rather be? Far from the Utopian myths, leadership is more like a Faustian bargain. There are costs, generally costs that the management gurus won’t tell you about. But when one is liberated from the myths of the gurus, it's possible to develop a pragmatic and ethical approach to leadership. Without the unicorns and rainbows.

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Post #2

by: Mitch McCrimmon, Mitch McCrimmon, Mitch McCrimmon
Issues: July / August 2010. Categories: Leadership.
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Man in a suit drawing out a diagram of football strategy.
In many organizations, employees know more about their work than their managers. This reality should force organizations that still cling to the old, top-down style of managing to recognize that many employees today are very capable of managing themselves. This author explains the “Why” and “How” of a new style of managing for today.

When we try to define management, our first thought is usually of a manager who occupies a role and who has authority over people. But in the case of knowledge workers, who manage themselves, management is seen as a process, one which can engage everyone. Thus, when we define management as a role, we restrict it to something that refers to managers only. Such a definition is not only a limiting one, it is one that does not account for the way in which work and responsibility has changed.

Industrial-age organizations were formal hierarchies that assigned specific roles to employees. The focus on roles put all power in the hands of managers, who governed employees by planning, organizing and controlling their work. This is essentially what made management a top-down, restricting function.

Today we talk of “managing one’s boss,” and of having “relationships with strategic partners, suppliers and customers.” But, if partners can manage their relationships with each other, then management cannot be a one-sided, controlling activity. And, if you can manage your boss, management isn’t restricted to the use of authority to control the people who report to you.

Management is much more than what managers simply do to get work done through employees. Today, we can manage ourselves, our time and many other activities that don’t require one to have a formal managerial role or even to manage people. This is why today, the function of management, as distinct from the role of the manager, has become everyone’s business.

The truth is that the role of the “manager” is only a particular application of management, not the whole story of managing. A broader perspective avoids the negative connotations so commonly attributed to management, such as controlling and restricting people. Moreover, employee engagement, especially with respect to innovative knowledge workers, cannot become a reality until we move beyond our industrial-age definition of a manager.

In modern, post-industrial organizations, all employees need to manage. Self-managing teams use complex systems to help them manage their own work, and precise performance measures are openly accessible. Knowledge workers don’t need to be told what to do, and often, they know better than their managers. This article will outline how we should see and define management for the 21st century by starting, not with the role of manager, but by seeing management as a process that can be led by all employees, not just managers.

Modern management defined
Management can be defined as a way of achieving goals that add the most value1. It’s about being sufficiently organized to identify the right goals and the best means for achieving them. To take a simple example, whenever you set priorities for yourself you are managing your time.

Prioritizing means deciding which activities are most likely to achieve a specific goal and which tasks are the most urgent or important. Management is thus like investing, a process of allocating resources to obtain the best return, even if those resources are just your own time, knowledge and experience. Clearly, it is possible for all employees to manage their own time and other personal resources without occupying a formal managerial role and without managing people.

Management is closely linked to goal achievement. Suppose your goal is to develop a cure for a rare disease. You could achieve this goal in one of three ways:

By luck – you could stumble on a cure while looking for something else.
In a disorganized, wasteful manner, exceeding your budget and alienating stakeholders.
In a cost-effective, inclusive way that makes the best use of all resources.
If you prefer the third approach, you are opting for management over luck and chaos. Everyone has goals: personal, career, business, financial, social, learning and leisure among others. The fact is that a managed approach – and not necessarily regimentation — will allow you to achieve more.

Front-line employees who have no one reporting to them routinely need to achieve multiple targets in tight timeframes. This is possible only if they manage key aspects of their work and time. Clearly, they can manage a lot of things without having authority over people or a management title.

One immediate benefit of adopting this perspective is that it allows us to silence the call to banish management. Even without the complexity of the modern world, no one today can live without management. In fact complexity simply makes management all the more vital. Today we have self-managing knowledge workers and teams. As a result, the role of manager needs to change. The function itself, however, is essential.

The hue and cry to get rid of management is really a call to dismiss managers. Setting tradition aside, we need to separate management from managers. Industrial-age thinking treats them as one and the same, which is why management has been tarred with the same brush as managers. We need to see that managers are just as critical as management itself.

Management as we know it is not totally without its supporters, but even some of its champions are helping to sustain its industrial-era image. In his latest book, Managing, management thinker and author Henry Mintzberg equates management with the role of a manager, thus distorting the role and overlooking how non-managers manage themselves and their own resources.

The London Business School’s Julian Birkinshaw, attempting to reinvent management2, uses the Wikipedia definition: ” the act of getting people together to accomplish desired goals and objectives.” The reference clearly applies to managers, thus ruling out self-management, not to mention the management of money or other non-human resources.

We need to rid ourselves of the concept and practice of industrial-age management, but not managers. As organizations evolve to meet new demands, management must be re-invented and re-defined accordingly. Importantly as well, industrial-age managers need to be replaced by modern managers, not by leaders.

The role of the manager
The operating style of industrial-age managers is represented by a metaphor of the organization-as-person, where the “head” thinks and the “hands” do. It is no coincidence that employees were once called “hired hands.” The implication of this metaphor is that managers do all the thinking and managing. The vision of employees as unthinking “hands,” to be moved around at will by a remote mind, is unsustainable in an age of empowerment and employee engagement.

We only started to disparage managers in the 1980’s, when Japan’s success in North America ignited the call to replace these same managers with leaders. Previously, management was regarded as a positive force in organizational life. But the 1980’s bandwagon was a classic case of throwing out the baby with the bathwater.3

Managers used to have a choice of styles: “theory y” (people are responsible and can be trusted) or “theory x” (people aren’t responsible and need to be controlled.) But the 1980’s call to replace managers with leaders arbitrarily restricted managers to the “theory x” style while gifting leadership the “theory y” style. This move was made because we wanted leaders to take over the domain of managers, getting work done through people. This left us with no way to differentiate managers from leaders except through totally arbitrary style assignments.

A broader definition of management rids us of this negative image and supports two claims:

All employees manage. Being more self-managing, they need to take more responsibility for ensuring that they obtain the best return on all of their efforts.
If management simply means getting work done in a way that makes the best use of all resources, then there is no implication of being rigidly controlling or mechanistic.
The role of manager re-invented
The modern manager needs to get work done through engaged, self-managing knowledge workers, who are a far cry from the “hired hands” of the industrial age. The role of today’s manager can be illustrated by four analogies. Today’s managers need to behave something like:

investors
customers
sports coaches
partners
Analogies are approximations; otherwise they would be identical to their comparison objects and not analogies at all. Thus, managers share some attributes with investors, customers, sports coaches and partners without being identical to any of them.

Managers as investors
Managers allocate resources to obtain the best return, like investors. Their effectiveness is based on how well they use their resources. But managers differ from investors in two respects. First, knowledge workers want a say in what work they do, so any allocation needs to be negotiated, not decided unilaterally, as an investor would do with his or her money. Second, managers actively develop people, so they are not as arms-length from the people they manage as are investors.

Managers as customers
As employees become more engaged their status changes, from simply being hired hands to being more like self-employed business people supplying services to internal customers. In this relationship, employees can be more proactive and able to identify the needs of managers. Indeed, astute employees might see needs that managers overlook. This interaction involves two-way communication and negotiation, not one-way, top-down directing. Also, enterprising employees might devise new services to “sell” to their managers as a way of advancing their careers (building their business).For example, whenever employees contribute ideas for process improvements to their bosses, they can be framed, condescendingly, as suggestion-box material or, more appropriately, as attempts by employees to sell their services to management. Employees who suggest a better way of managing some part of the business and offer to do it themselves can, in steps, transform their roles into something new. By thinking of themselves as operators of a business, and serving their bosses as customers, employees become more empowered to manage their own careers.When high-demand knowledge workers are in short supply, they have more power than their customer (the boss). Such employees can easily move to new customers and, being knowledgeable, they might offer more advice to their boss (customer) rather than the other way around. So much for the belief that power resides only at the top and all direction flows top-down.

Managers as sports coaches
Professional golfers have coaches and managers. The latter help them with their business matters, sponsorships and travel arrangements. However, this manager cannot fire the golfer; it is the other way around. A sports manager is a facilitator, coordinator and advisor, with no power to direct or control the golfer. Modern business managers are moving in this direction, although they will always be able to fire the employees they manage. Still, when managing rare, expensive talent, they cannot fire them without carefully weighing the consequences. In any case, modern managers do more coaching and less directing, so they need to behave more like coaches than industrial-age managers.

Managers as partners
As the power of knowledge workers grows, they become more like partners than “hired hands.” Toyota and other smart companies forge partnerships with external suppliers. Employees are, similarly, internal suppliers and partners. Still, suppliers and employees can be fired, unlike real partners, who must agree on an appropriate severance.
Facilitating versus directing
In the industrial age, managers directed and controlled the work of “hired hands.” In our post-industrial era, managers operate more like facilitators. Instead of allocating resources like passive, hands-off investors – that is, without much thinking — they bring the right people together, engage them in planning the work and coordinate the execution. Like customers, they monitor the progress of projects, but they may listen more often than provide one-way direction. In this context, the act of controlling morphs into coaching, facilitating, nurturing and developing.

The conventional managerial functions of planning, organizing, directing and controlling become a shared activity or ones that are completely delegated, depending on the context. Management adapts to meet current needs rather than hangs on to obsolete industrial-age preconceptions.

Changing how decisions are made
Like customers and investors, managers retain the right to decide whether and how much to invest or whether to use different resources. But they can no longer “dictate” if they hope to engage knowledge workers and reap the benefits of their full potential. Now, they have to ask “What do you think?” more than give orders. Instead of making all the decisions, they need to involve employees by asking questions to draw solutions out of them. This change in decision-making style, however, is not just a tactic to engage employees more deeply. It is recognizing the reality that employees know as much or more than the manager. Being more engaging and given to less directing are essential for making the best decisions.

Transformational leadership or managerial motivation
The transformational leadership bandwagon was launched in the 1980’s, not coincidentally at the same time that leaders were usurping the role of managers. We used to say that managers had to motivate employees. But once managers were cast in the bad guy role of controlling disciplinarians, we needed transformational leaders to inspire employees.

Transformational leadership, however, is an industrial-age model because it portrays influence as a force that flows exclusively top-down. Modern managers help employees find motivation through coaching. They help identify their motivation and strengths. Managers then provide the kind of work that best leverages those strengths.

It is like performing a strategic review of a business, where the manager helps employees discover their core strengths and then helps them channel their focus accordingly. Finding what motivates particular employees is a process of discovery that is very much led by the employee. Transformational leaders and industrial-age managers operate with a “boss-knows-best” mindset, which is why they try to inject motivation into employees in a one-way, top-down manner.

Maintaining the status quo versus innovation
Managers are often faulted for preserving the status quo and blocking innovation. This accusation may have been justified for industrial-age managers. But, remember that the objective of managers is to achieve goals in a way that makes the best use of resources. All organizations have two objectives: to manage today’s business profitably and to create the future through innovation.

To foster innovation, modern managers act as facilitators and culture builders. They bring the right people and other resources along with whatever support mechanisms are required to foster creative thinking.

It is often said that leaders are creative while managers are not. But this again exemplifies industrial-age thinking (and a complete red herring) because it focuses exclusively on the individual in charge, which is consistent with a one-way, top-down mode of operating. The person in charge (leader or manager) does not need to be creative at all because the role, properly fulfilled, is one of facilitating creative thinking in others. Managers can thus foster innovation with or without being creative.

Management versus leadership
Management re-invented and re-defined as described above resumes its rightful place as a core driver of organizational performance. But what is there left for leadership to do? Leadership is the process of influencing. Whenever any employee influences others to change direction, leadership has been demonstrated, whether it’s top-down or bottom-up. If leadership is an influence process, then it can’t make decisions. Thus, all decisions are managerial actions, even strategic ones3. A CEO shows leadership by promoting a new vision. A front-line knowledge worker shows leadership by promoting a new product.

Why it matters
To achieve the level of innovation required for competitive advantage today, we need to achieve a better balance of power throughout organizations. Employees need to be more fully engaged in making strategic decisions, and in planning and organizing more of their own work. To break the stranglehold of the “organization-as-person metaphor,” employees need to share in strategic thinking. Such ownership is the only way to achieve deep engagement. As a result, managers need to do less telling and, as facilitators, do more asking, as in “What do you think?” There is a trend to view leadership in facilitative terms, but this is really leadership usurping management’s territory. Drawing solutions out of employees is a management technique, not a demonstration of leadership.

Keep in mind how Martin Luther King, Jr. showed leadership. He didn’t facilitate a meeting of stakeholders. He spoke over their heads directly to the general public. He challenged the status quo and called for change. He influenced people to change, without having or exercising the authority to decide anything for them.

Competitive advantage depends on ridding ourselves of industrial age notions of leadership and management. All employees can share in management and show leadership, but only in post-industrial organizations.

Joan Magretta, What Management Is, Profile Books, 2003
Julian Birkinshaw, “Reinventing Management,” Ivey Business Journal Online, Jan/Feb 2010.
Mitch McCrimmon, “Leadership and Management Reinvented,” Ivey Business Journal Online, Jan/Feb 2010.

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DECISION MAKING
Robert S. McNamara and the Evolution of Modern Management
Phil Rosenzweig

Every generation of managers wrestles with questions about its purpose. In the 1950s and 1960s, to be an able manager was to do four things well: plan, organize, direct, and control. Leading business thinkers conceived of managers as rational actors who could solve complex problems through the power of clear analysis. That view shaped the developing profession, but many questions were left unanswered. Planning and directing were essential, yes, but toward what ends? Organizing and controlling, of course, but in whose interest?

By the 1980s and 1990s, one answer had come to dominate popular thinking: The purpose of management was to enrich a company’s owners. Shareholder value creation had the advantage of being precisely and objectively measurable—and made CEOs like Roberto Goizueta, Sandy Weill, and Jack Welch legends. Yet as a managerial mission, the pursuit of financial wealth has proved to be unsatisfactory. In the past decade, as evidence that markets are far from efficient has mounted and much of the wealth created has been wiped out, basic questions about management have resurfaced. Today the focus has shifted to how management should contribute to society, provide for environmental sustainability, and improve the lives of people at the bottom of the pyramid. The fundamental purpose of management is being debated at leading business schools, where students consider the merits of taking professional oaths that would commit them to pursue goals beyond financial performance.

For those who have chosen management as their livelihood, these are not academic questions. They speak to the ultimate question that confronts us all: Has my life’s work been important? As we consider the various purposes to which managers’ talents could be applied, and how their contributions may come to be judged, we may gain useful insights by examining the life of one man who grappled with these issues for more than 50 years.

The career of Robert S. McNamara spanned academia, private enterprise, government, and humanitarian service. He was a professor at Harvard Business School in the early 1940s; an executive at Ford Motor Company for 15 years, becoming its president in 1960; the secretary of defense for seven years under presidents Kennedy and Johnson; and the president of the World Bank for 13 years. In the eyes of many, of course, McNamara’s accomplishments were overshadowed by the tragedy of Vietnam. When he died in 2009, at age 93, the New York Times’ obituary headline described him simply as the “architect of a futile war.” Because of his role in it, he tends to be caricatured as smart but not wise, obsessed with narrow quantitative measures but lacking in human understanding. The controversies surrounding Vietnam are complex and will endure, but it would be a mistake not to draw any other lessons from his remarkable career. Perhaps more than anyone else, Robert McNamara personified management in the 20th century. In his legacy we see the triumphs of modern management as well as its most troubling limitations.

Analytical Whiz Kid
McNamara was born in San Francisco in 1916 and came of age during the Great Depression. As a youth he witnessed labor unrest in local shipyards and massive unemployment. After high school he enrolled at the University of California, Berkeley, where he majored in economics because he felt it offered the most useful tools for addressing society’s largest problems. From the outset he thought of management as a means of bringing positive change to the world, not as a means of financial gain for himself or a company’s owners.

After graduating in 1937, McNamara entered Harvard Business School. According to Jeffrey Cruikshank’s history of the school, this was a time when the field of management was on the cusp of great progress. One required course, Business Statistics, had begun to teach methods of quantitative decision making. Its professor, Edmund Learned, later recalled: “We sought to train our men for positions of responsibility that required statistical facts and analyses for diagnosis or action purposes. We wanted men to develop judgment in the use of figures [and] contribute to an intelligent solution of the problem under discussion.” HBS’s accounting courses had been moving in a similar direction. In 1936, Professor Ross Walker offered a course called Aspects of Budgetary Control, which focused on practical aspects of planning and decision making. The curriculum covered the techniques of modern professional management: cost accounting, control systems, management information systems, and decision science. McNamara was an eager and receptive student of the new methods. After earning his master’s of business administration, in 1939, he returned to San Francisco for a year, before accepting an offer to join Harvard Business School as a faculty member. At age 24, he became its youngest assistant professor.

During World War II, McNamara taught in the Army Air Forces’ statistical school and then took unpaid leave from Harvard to serve in the Army’s Department of Statistical Control. Aircraft were playing an increasingly important role in warfare, but no system had been developed to track planes and their crews, monitor spare parts, or allocate fuel. The complexity of the modern war machine had surpassed the ability to manage it. McNamara helped bring the rigor of statistical analysis to the war effort, improving logistical efficiency and mission planning. His biographer Deborah Shapley found evidence of his influence in an army report from the era: “Much of the success of the system has been due to the Harvard method which stresses the ‘meaning of figures’—the power to analyze something for oneself.”
In 1946, rather than returning to academia, McNamara became part of an elite team from Statistical Control that joined Ford. They were nicknamed the Whiz Kids. The firm’s young president, Henry Ford II, charged them with overhauling the once-proud company, now in disarray and losing money. McNamara’s star rose as he brought the discipline of rational analysis to Ford’s sprawling bureaucracy, emphasizing facts and figures. Austere and formal, with rimless glasses and neatly slicked-back hair, McNamara projected a no-nonsense air. The financial turnaround at Ford was remarkable, yet he did not focus only on shareholder returns. He went about his work with an acute sense of social responsibility. Unlike most automobile executives, he was an early champion of passenger safety. He later recalled, “The prevailing idea in the auto industry was that if you talked about safety, you’d scare the public.” Under McNamara’s leadership, Ford’s 1956 models featured padded instrument panels and safer steering wheels, and were the first passenger cars with seat belts. Rivals scoffed: “McNamara sells safety, Chevrolet sells cars.” Yet he persisted, guided by his sense of responsibility to the public.

The Portable Professional
Selected by President John F. Kennedy to serve as secretary of defense, McNamara arrived in Washington in January 1961. He epitomized the confidence of the American Century: He was a technocrat free of ideological blinders, focusing on the facts and deducing the truth from statistics. BusinessWeek described him as a “prize specimen of a remarkable breed in U.S. industry—the trained specialist in the science of business management who is also a generalist moving easily from one technical area to another.” Once again, McNamara’s sense of public service was strong. He had been among the highest-paid executives in the world, earning $410,000 a year in salary and bonuses at Ford, and gave it up to become a cabinet secretary with a salary of $25,000. More significantly, to avoid even the appearance of a conflict of interest, he chose not to exercise options on 30,000 shares of Ford stock, valued at $47 a share.

At the Pentagon, McNamara applied his usual rigorous approach to the management of the vast military establishment. Until then, each branch of the service had had its own budget and pushed its preferred weapons systems. The result was massive inefficiency and questionable effectiveness. McNamara set out to optimize the nation’s arsenal, to provide the best military capability in the most efficient manner, subordinating the parochial interests of the individual services. He also overhauled U.S. military strategy, replacing the potentially catastrophic doctrine of massive retaliation with a doctrine of flexible response, which insisted on proportionality and sought to avert escalation. Congress was highly impressed. Republican Barry Goldwater called McNamara “one of the best secretaries ever, an IBM machine with legs.”

Barry Goldwater called McNamara “one of the best secretaries ever, an IBM machine with legs.”

Even during the most difficult days of the Vietnam War—which would eventually overwhelm him and President Lyndon Johnson—McNamara did not lose sight of the goal that had inspired him as a youth: contributing to the greater good. In a remarkable 1967 speech at Millsaps College, in Mississippi, he offered a stirring vision of management. (See the sidebar “Management Is the Most Creative of Arts.”) He spoke, too, about the growing gap between rich and poor nations. National security was inextricably linked to global security, and global security to closing that gap. As the Nobel Prize–winning economist Amartya Sen would later observe, economic development is freedom—and conversely, without it, there is no freedom. After leaving the Pentagon and becoming president of the World Bank, a post he held from 1968 to 1981, McNamara turned his energies toward expanding funding for development. He shifted the bank’s focus toward poverty reduction, dramatically increasing the financial support for projects in health, nutrition, and education. He relied, once again, on a fact-driven approach—measuring well-being and funneling loans to the most effective development programs.
By the 1980s, McNamara’s star had fallen, and not just because of his role in the Vietnam debacle. American business seemed to have lost its way, and the management methods he exemplified were being questioned. In their landmark 1980 Harvard Business Review article, “Managing Our Way to Economic Decline,” Robert H. Hayes and William J. Abernathy blamed slumping U.S. fortunes on the rise of professional managers. They charged: “What has developed, in the business community as in academia, is a preoccupation with a false and shallow concept of the professional manager, a ‘pseudoprofessional’ really—an individual having no special expertise in any particular industry or technology who nevertheless can step into an unfamiliar company and run it successfully through strict application of financial controls, portfolio concepts, and a market-driven strategy.”

Yet it was precisely the ability to apply managerial logic that had allowed McNamara to achieve improvements that insiders could not, or would not, produce. At Ford it took someone from outside the auto industry to provide analytical clarity as well as to focus on passenger safety. At the Department of Defense, it took an outsider to bring coherence to the management of the American military establishment, subordinating the interests of each branch to the overall purposes of the nation. McNamara’s skills were precisely what had been needed in sprawling organizations staffed by insiders.

Though it was easy to condemn the shortsightedness of professional management for the slump, the truth was more complex. America’s rise to leadership in the first place had been due in large part to the success of modern management. To blame management for the nation’s failure to maintain the lead reflects a misunderstanding of the ebbs and flows of relative performance, as countries improve and gaps narrow. Furthermore, U.S. carmakers might have fared better against foreign competition from efficient companies with economical cars if McNamara’s views had prevailed. When he’d left for Washington, his plans for the Cardinal—an inexpensive car to be built at lower-cost facilities abroad—were scrapped.

Focused to a Fault
Whether at Ford or in the military, in business or pursuing humanitarian objectives, McNamara’s guiding logic remained the same: What are the goals? What constraints do we face, whether in manpower or material resources? What’s the most efficient way to allocate resources to achieve our objectives? In filmmaker Errol Morris’s Academy Award–winning documentary The Fog of War, McNamara summarized his approach with two principles: “Maximize efficiency” and “Get the data.”
Yet McNamara’s great strength had a dark side, which was exposed when the American involvement in Vietnam escalated. The single-minded emphasis on rational analysis based on quantifiable data led to grave errors. The problem was, data that were hard to quantify tended to be overlooked, and there was no way to measure intangibles like motivation, hope, resentment, or courage. Much later, McNamara understood the error: “Uncertain how to evaluate results in a war without battle lines, the military tried to gauge its progress with quantitative measurements,” he wrote in his 1995 memoir, In Retrospect. “We failed then—as we have since—to recognize the limitations of modern, high-technology military equipment, forces, and doctrines in confronting highly unconventional, highly motivated people’s movements.”

Equally serious was a failure to insist that data be impartial. Much of the data about Vietnam were flawed from the start. This was no factory floor of an automobile plant, where inventory was housed under a single roof and could be counted with precision. The Pentagon depended on sources whose information could not be verified and was in fact biased. Many officers in the South Vietnamese army reported what they thought the Americans wanted to hear, and the Americans in turn engaged in wishful thinking, providing analyses that were overly optimistic. At first, being likened to a computer was meant as a compliment; later, it became a criticism. In the wake of Vietnam, McNamara was derided for his coldness and scorned as one of the so-called best and brightest who had led the country into a quagmire through arrogance.

Yet in this dark episode, too, the career of Robert McNamara lets us appreciate how management thinking has taken important steps forward. We know today that people are not the rational creatures suggested by conventional economic theory but exhibit systematic biases of judgment. We know, as well, that organizational processes have their own dynamics—such as the escalation of a commitment to a losing course of action, and the tendency to silence dissenting views—that can lead to flawed decisions.

The career of Robert McNamara offers more than an overview of modern management and its successes and limitations. It also illustrates that managers have the capacity for reflection and the ability to gain wisdom. In McNamara’s case, the need for introspection and insight was particularly acute. The historian Margaret MacMillan has written that “McNamara spent much of his life trying to come to terms with what went wrong with the American war in Vietnam.” He sought to understand the sources of errors, hoping to square what he earnestly believed were good intentions with the massive waste and tragic loss.

When, after many years of silence about Vietnam, McNamara published his memoirs, he admitted: “We were wrong, terribly wrong.” Many people, their lives scarred by the trauma of Vietnam, found such a statement too little, too late. Yet McNamara had insisted that the subtitle to In Retrospect be “The Tragedy and Lessons of Vietnam” because he believed that tragedies could be avoided if lessons were learned. In fact, the willingness to question oneself and learn from experience may be Robert McNamara’s greatest legacy as a manager. At 85, he told Errol Morris, “I’m at an age where I can look back and derive some conclusions about my actions. My rule has been: Try to learn. Try to understand what happened. Develop the lessons and pass them on.”

That quest guided McNamara’s later years. He traveled to Cuba and met with Fidel Castro, to understand more fully the 1962 missile crisis and find ways of avoiding future nuclear confrontations. He visited Vietnam and met with Vo Nguyen Giap, commander of the North Vietnamese forces, to discover where things had gone awry in that conflict. One key insight: that it was crucial to empathize with one’s enemies, to attempt to see the world as they did. He concluded that the Cuban Missile Crisis had been resolved peacefully because U.S. diplomats were able to understand Premier Khrushchev’s thinking. But in the case of Vietnam, he admitted, the adversary’s motivations and priorities were misunderstood. McNamara recalled: “We saw Vietnam as an element of the Cold War, not what they saw it as, a civil war.” It was a tragic error that “reflected our profound ignorance of the history, culture, and politics of the people in the area and the personalities and habits of their leaders.”

Yet it would be misleading to suggest that McNamara had abandoned the belief in rational analysis. Indeed, the greatest challenges we face today—from global warming, to water pollution, to health care, to economic development—clearly demand the power of logical analysis in service of human ends. At organizations as disparate as the Centers for Disease Control and the Bill & Melinda Gates Foundation, idealism and rational analysis are not at cross-purposes at all. In a 1995 interview, McNamara returned to this theme: “I don’t believe there’s a contradiction between a soft heart and hard head. Action should be founded on contemplation.”

It’s tempting to think of today’s problems as qualitatively different from those that confronted past generations. Surely, the threats to our environment are greater than ever, the pressures of globalization are more intense, and the technologies we use were unimagined even a few years ago. Yet many of the broader questions about the purpose and aims of management remain the same, and managers today confront many of the same dilemmas as their forebears did.

In 2005, months before his 89th birthday, McNamara returned to Harvard Business School and spoke with students on the subject of decision making. Among the lessons he stressed: That for all its power, rationality alone will not save us. That humans may be well-intentioned but are not all-knowing. That we must seek to empathize with our enemies, rather than demonize them, not only to understand them but also to probe whether our assumptions are correct.

A man often accused of lacking empathy urged us to empathize with our adversaries. A man who prided himself on rationality concluded that humanity cannot be saved by rationality alone—for none of us makes decisions in a completely rational manner—and that systems must therefore be made resistant to the irrationality in each of us. The final measure of a manager, more than amassing wealth or seeking to follow an oath, may be the willingness to examine one’s own actions and seek a measure of wisdom.

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The Principles of Modern Management

Are your management practices long in the tooth?

I think I was lucky that early on, I worked in environments that shook things up and rattled the cage in pursuit of more customer impact, employee engagement, and better organizational performance.

In one of the environments, a manufacturing plant, the management team flipped the typical pyramid of the management hierarchy upside down to reflect that the management team is there to empower and support the production line.

And when I was on the Microsoft patterns & practices team, we had an interesting mix of venture capitalist type management coupled with some early grandmasters of the Agile movement.   More than just Agile teams, we had an Agile management culture that encouraged a customer-connected approach to product development, complete with self-organizing, multi-disciplinary teams, empowered people, a focus on execution excellence, and a fierce focus on being a rapid learning machine.

We thrived on change.

We also had a relentless focus on innovation.  Not just in our product, but in our process.  If we didn’t innovate in our process, then we got pushed out of market by becoming too slow, too expensive, or by lacking the quality experience that customers have come to expect.

But not everybody knows what a great environment for helping people thrive and do great things for the world, looks like.

While a lot of people in software or in manufacturing have gotten a taste of Agile and Lean practices, there are many more businesses that don’t know what a modern learning machine of people and processes that operate at a higher-level looks like.

Many, many businesses and people are still operating and looking at the world through the lens of old world management principles.

In the book The Future of Management, Gary Hamel walks through the principles upon which modern management is based.

The Principles of Modern Management
Hamel gives us a nice way to frame looking at the modern management principles, by looking at their application, and their intended goal.

Via The Future of Management:

Principle Application Goal
Standardization Minimize variances from standards around inputs, outputs, and work methods. Cultivate economies of scale, manufacturing efficiency, reliability, and quality.
Specialization (of tasks and functions) Group like activities together in modular organizational units. Reduce complexity and accelerate learning.
Goal alignment Establish clear objectives through a cascade of subsidiary goals and supporting metrics. Ensure that individual efforts are congruent with top-down goals.
Hierarchy Create a pyramid of authority based on a limited span of control. Maintain control over a broad scope of operations.
Planning and control Forecast demand, budget resources, and schedule tasks, then track and correct deviations from plan. Establish regularity and predictability in operations; conformance to plans.
Extrinsic rewards Provide financial rewards to individuals and teams for achieving specified outcomes. Motivate effort and ensure compliance with policies and standards.
What are the Principles Upon Which Your Management Beliefs are Based?
Most people aren’t aware of the principles behind the management beliefs that they practice or preach.  But before coming up with new ones, it helps to know what current management thinking is rooted in.

“Have you ever asked yourself, what are the deepest principles upon which your management beliefs are based? Probably not.  Few executives, in my experience, have given much thought to the foundational principles that underlie their views on how to organize and manage.  In that sense, they are as unaware of their management DNA as they are of their biological DNA.  So before we set off in search of new management principles, we need to take a moment to understand the principles that comprise our current management genome, and how those tenets may limit organizational performance.”

A Small Nucleus of Core Principles
It really comes down to a handful of core principles.  These principles serve as the backbone for much of today’s management philosophy.

“These practices and processes of modern management have been built around a small nucleus of core principles: standardization, specialization, hierarchy, alignment, planning, and control, and the use of extrinsic rewards to shape human behavior.”

How To Maximize Operational Efficiency and Reliability in Large-Scale Organizations
It’s not by chance that the early management thinkers came to the same conclusions.  They were working on the same problems in a similar context.  Of course, the challenge now is that the context has changed, and the early management principles are often like fish out of water.

“These principles were elucidated early in the 20th century by a small band of pioneering management thinkers -- individuals like Henri Fayol, Lyndall Urwick, Luther Gullick, and Max Weber. While each of these theorists had a slightly different take on the philosophical foundations of modern management, they all agreed on the principles just enumerated. This concordance is hardly surprising, since they were all focusing on the same problem: how to maximize operational efficiency and reliability in large-scale organizations. Nearly 100 years on, this is still the only problem that modern management is fully competent to address.”

If your management philosophy and guiding principles are nothing more than a set of hand me downs from previous generations, it might be time for a re-think.

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I chose the following articles because of the contrast in views about Modern Management, and how the are applied to different organizations.
Some believe that Modern Management is companies that are  changing with the times from a technological standpoint, others believe as time changes so do their employees and customers.
So today's managers must be fast learners as well as willing leaders. No longer can Managers tell employees 'just get the job done' and expect quality work on time. Supervisors must invest in the workforce in order for the workforce to invest in the organization.

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Diversity management is the key to growth in today’s fiercely competitive global marketplace.  No longer can America’s corporations hide behind their lack of cultural intelligence.  Organizations that seek global market relevancy must embrace diversity – in how they think, act and innovate.  Diversity can no longer just be about making the numbers, but rather how an organization treats its people authentically down to the roots of its business model.   In today’s new workplace, diversity management is a time-sensitive business imperative.

To better understand this fast-changing terrain, I reached out to three notable diversity executives -- pioneers within their respective industries – to share their insights and perspectives regarding the future of diversity and some of the new best practices that will allow diversity to play a more strategic role in cultivating sustainable business growth:

Corporate leaders pay lip service to diversity, but they don’t really live it.   Diversity is more than employee demographics and support for a few non-profits.  You can’t buy diversity, and organizations that continue to embrace this approach will tarnish their brand.  America is changing, and the new population carefully evaluates how organizations relate to it. If you are not authentic, consumers and employees will begin to question the authenticity and leadership of your organization.

As Rohini Anand says, “The traditional representation perspective originated from the Civil Right era.  This will never go away entirely.  However, diversity must go beyond this mentality.  At Sodexo, diversity is embedded in our brand.  The Sodexo brand is synonymous with diversity.  Though the Sodexo brand is not a known consumer brand, diversity leadership defines our brand – it’s all about talent.  Diversity is about responding to the needs of our clients in a holistic way.

And Kathy Hannan adds, “Companies must take a long term strategic approach to engage diverse talent.  Companies must define their role in the global marketplace.  The train has left the station.  You may not be where you want to be with your diversity strategy, but you need to get started!”

How would you grade the authenticity of your diversity business strategy?

Executives are Still Short-Sided

I’m reminded of a pre-recession discussion I had with a consumer goods executive who said: “Diversity is another way of saying affirmative action and we are forced to support it in order to protect our brand in the trade and amongst our consumer audience.  Diversity has no real value tangible to the growth of our business.”   Unfortunately, many executives still share this opinion today.

As Rohini Anand says, “Consumer Packaged Goods (CPG) companies have been particularly effective with diversity from a marketing initiative standpoint.  However, this is different from embracing diversity holistically.  Companies must think about diversity beyond addressing niche needs.  Diversity is not just about accessing multicultural markets.  Companies must look more broadly to reinvent the way we think about how business is done.  How can diversity be pulled out of this commoditized mentality?  Diversity leadership must drive innovative perspectives.  Companies have not yet figured out how to unlock the potential within markets and processes that must be enabled globally.”

Do your top executives still adhere to the traditional rules of the workplace?  Has their approach lost its relevancy?

Diversity is much more than just a multicultural issue.  Diversity is about embracing many different types of people, who stand for different things and represent different cultures, generations, ideas, and thinking.  As Ron Glover says, “Innovation is about looking at complex problems and bringing new views to the table.  Diversity has allowed IBM to be innovative and successful for 100 years and to work across lines of differences in 172 countries, amongst 427,000 employees.”

For example, are you paying attention to the Internet and how online communities continue to grow and represent different voices and points of view?
As a result of this virtual diversity, innovation continues to thrive in the online world.

So why can’t these same attitudes, ownership and principals apply to the workplace at a time when America needs innovation to reinvent itself to remain relevant in the global marketplace?

Kathy Hannan notes, “Diversity has moved away from a nice-to-have, to a must-have for companies as a strategic business imperative.  KPMG has a multinational client base.  We must understand their protocols, their ways of doing business.  Diversity must move from just a value, to being operational.”

Anand adds, “Diversity must drive the formation of new business models.  Leaders must think about the changing landscape:  the economy is changing, how business is being done is changing, so the question is how can diversity be utilized as a strategic enabler in today’s changing landscape.”

And Glover says, “Diversity is a core belief of IBM in how we succeed in business. In order for IBM to successfully expand globally, we need a workforce that understands the local market.  Our clients are as diverse as our employees.  And there are now 5 generations in the workplace.  We must focus on building communities inside of IBM to embrace differences to drive innovation globally.”

Diversity needs a Refresh

Diversity clearly needs a refresh.  The misinterpretations of what diversity means and what it truly represents have limited its ability to have the real impact and influence it warrants in America’s corporations.     In fact, the executives who get it today will tell you how concerned they are for their business, because their people, products, and services do not connect naturally with the new faces of America.   As one executive told me, “Our business demands diversity and we are more uncomfortable with our lack of diversity preparedness than ever before.  We are in trouble if we don’t fix it!”  As a result, most companies have been forced to react not only to the changing face of America and but the mindsets of the global marketplace.    Consequently, executives have started to confront the inevitable: a new business model that fully integrates diversity as a business growth enabler.

Kathy Hannan says, “No homogeneous talent pool can be innovative.  Diversity is essential.  And, there are broader implications across the whole supply chain.  Diversity is about how you do business across the board.”

Has your organization experienced this awakening moment yet?   Is America too one-dimensional in its approach to diversity?

In my most recent blog, I discussed how the lack of cultural intelligence in business and society is damaging our enterprises and our economy.  Hundreds of reactions from people focused on encouraging their leaders to embrace diversity more strategically in order to be more culturally intelligent – to help their companies grow.  While their reactions were genuine, what concerns me is that many of these organizations are still in the early stages of integrating the basic functional and leadership requirements of diversity.

Kathy Hannan notes, “KPMG took diversity and integrated it with corporate responsibility.  We purposely took the word “social” out.  This made us look at ourselves as an organization at the highest level of integrity.  Today, KPMG views its sustainability strategy across four areas: Ethics, Citizenship, Environmental and Diversity (talent sustainability).  You need to start with who you are.  It’s about making a long-term investment -- to have long-term sustainable impact.”

At what stage of diversity management is your organization?

To better understand the future of diversity management and its role as a business growth enabler, think back to when Information Technology (IT) was viewed as just a cost center.   IT was not associated with driving business growth 20 years ago, but rather as a required cost of doing business.  Just like diversity today, many people then thought IT got in the way of business.   Today, IT is considered a profit center by many and a high priority for organizations as a business growth enabler.   In fact, many CIOs (Chief Information Officers) are next in line for the CEO role.   As a result, to be an influential CIO; you must be a business strategist with an MBA (not just a computer science degree).

CDOs (Chief Diversity Officers) will experience many of the same functional role and responsibility shifts as have CIOs.  They will not only be required to assume their practitioner responsibilities, but they must also learn to play a more integral strategic role in the design of new business models.  Glover notes, “Diversity is a critical leadership success factor at IBM. Globally diverse leaders are maximizing the effectiveness of our teams.  IBM has recognized the importance of building teams across the company from different countries.    It’s not just about leadership, but capability.  Diversity is fundamentally focused on talent!  Those differences create real opportunities for those who learn to master them and a disaster for those who do not.”

Diversity management will begin to develop rapidly, out from under the traditional human resources and talent acquisition roles, to assume more dotted-line responsibilities that will touch corporate strategy, corporate social responsibility, organizational design & effectiveness, corporate marketing and even sales.  Therefore, the requirements to be an effective CDO will mean that they must include operating more holistically in a general management and operational capacity to ensure that diversity becomes an embedded mindset with common threads that touch all functional areas (internally) and the supply chain (externally).

Hannan notes, “Good intentions are not a substitute for accountability.  Everyone must be accountable for advancing diversity.”

Is your organization being proactive to reinvent the role of diversity management as a strategic business growth enabler?   Is your CDO prepared to assume these new leadership and competency requirements?

How you manage diversity in your organization from today forward will determine your long-term success or failure in the global marketplace.

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Seven Steps to Effective Diversity Management
PDJ April 25, 2011  1

Management22 Thoughtleader74
by Julie b. Kampf

CEO and President
JBK Associates, Inc.

Once upon a time, diversity was regarded as a matter of employment equity or affirmative action…an idea now as outmoded as cassette tapes. In today’s world, a diverse workforce is widely regarded as a key business imperative and should be incorporated into every organization’s strategy. A diverse workforce can deliver better decision-making, better products and services, happier customers, increased productivity and a better bottom line. According to FORTUNE magazine, companies that enjoy a diverse and inclusive culture outperformed the S&P 500.

In 1996, there were fewer than 10 executives nationwide responsible for diversity. Today, almost every Fortune 100 company has one. However, surveys consistently report that diversity management is not well understood.

Successful diversity management is about unleashing the rich and diverse potential of an entire workforce. Here are seven steps to build a better diversity strategy:

Define your terms. Everyone has a different idea about what diversity means. Beyond race and gender, it can also include but is not limited to considerations of age, ethnicity, religion, sexual orientation, mental and physical capabilities, gender identity, family status, language, opinions and working style. Define diversity for your organization as there is no one-size-fits-all solution.

Be realistic. When setting goals, involve everyone who has a responsibility for diversity, from the CEO on down, as buy-in is critical. But also manage their expectations. Diversity management is complex and not every company will advance at the same pace.

Build in metrics. Diversity management should measure progress toward specific, quantifiable long- and short-term goals.

Assemble your resources. You can’t achieve your goals as a company if you don’t have the right human or fiscal resources in place. Just by saying you want to become a diverse organization doesn’t guarantee that you will get there.
”Successful diversity management is about unleashing the rich and diverse potential of an entire workforce.”
Set up a system. Talent acquisition is about attracting the best talent from a pool of outstanding individuals of diverse backgrounds. Once you’ve attracted the talent, you must enable them to become part of the established culture of your organization.

Educate. Everyone needs to be trained. Managers must be educated about the benefits of diversity and the processes necessary to achieve it. Employees must be given the coaching, mentoring and skills they need. Without training, you risk losing your best talent to your competitors.

Demonstrate CEO support. Employees take their cues from the top, so your most senior executive must be able to articulate the business case for diversity.

Diversity is the creation of an organizational culture where the best people want to work, where everyone is treated with dignity and respect, where people are promoted on their merits and where opportunities for success are available to all. Embedding the principles of diversity management in everything helps in achieving your company’s most ambitious business goals

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The Importance of Diversity in Management
by Lisa Bigelow
Successful global businesses understand their foreign counterparts' protocol.
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Why Is Diversity in the Workplace Important to Employees?
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Manage Diversity in a Workplace
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Importance of Workplace Diversity
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Challenges of Diversity Management
As the marketplace for goods and services becomes increasingly global, businesses must understand and embrace diversity in their brands as well as in their work forces. Simply having a diverse employee population is no longer enough, according to Forbes; for a company to succeed in today's challenging economy, it must not only meet the needs of a multifaceted marketplace, it must respect different cultures, ideas and philosophies.

Innovation
One of the biggest reasons to employ a diverse work force is the broad base of cultural experience that will drive innovation. Whether an employee is management, mid-level or entry level, when everyone in the work force has a similar background, the creative process that drives innovation and problem solving is similar. A new perspective that doesn't match this "group think" is more likely to improve the business in a unique way.

Attracting Talent -- and Customers
Premier industry business talent prefers to work for or with a company that has a diverse work force. Customers also prefer to buy goods and services from diverse companies, too. These are two reasons that Forbes says to be truly successful in the global marketplace, a business must be authentically diverse. That means a company must develop a new model that embraces diversity as a central growth enabler.

From Recruitment to Strategy
Companies that embrace this authentic diversity will find that having only the requisite number of "minorities" in the workplace isn't enough. Instead, according to Forbes, companies are developing "chief diversity officer" roles that touch more than just recruitment and human resources. These CDOs will instead have greater control over areas such as strategy, marketing and sales. Companies that have diversity among the management staff will more easily fulfill the needs of a broad customer base.

Cultural Intelligence
Perhaps the most compelling reason to employ a diverse work force is cultural intelligence. When fellow employees and customers are diverse, the opportunities not just to learn but to appreciate what values other cultures hold sacred are limitless. Adopting these values as part of the business' core message and product fosters understanding between the cultures. When a business operates with diversity in mind, the opportunity for shared value -- both in profit and society -- is greatly expanded.

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PUBLISHED BY:
YALE SCHOOL OF MANAGEMENT

What do leaders need to understand about diversity?VICTORIA L. BRESCOLL JANUARY 01, 2011
In globalized, multicultural organizations, leaders need to learn to create value out of diversity. Five experts discuss what it takes to make this happen.

LEADERSHIP
Making Diversity Part of the Organization
David Thomas
H. Naylor Fitzhugh Professor of Business Administration, Harvard Business School

What do business leaders need to understand about diversity?

The first thing is that the companies that do it most effectively don’t have a separate program. What they do is integrate diversity into all of the processes of their organization. Diversity becomes a lens for looking at, identifying, developing, and advancing talent. So when they think about recruitment, they don’t only have a minority recruiter. They educate all of their recruiters about how to relate to the diversity of the population that they recruit from.

Leaders need to know that they have to build accountability into their systems with regard to their managers taking responsibility for creating a diverse and inclusive work environment. We often see the people at the very top saying all the right things relative to diversity, but their middle management, who really run the organization and create the experience of people who work there, don’t understand and don’t feel accountable for diversity and inclusion.

You can cut diversity across a lot of different dimensions—what’s important for each organization is to identify the relevant dimensions, measure them, and make that part of how managers are evaluated. It’s not a matter of inventing new measures as much as it is using diversity as a lens to look at the measures that we have. And diversity, in my view, should also be one of the lenses through which we look at customers and community stakeholders.

There is a cosmetic diversity that can come when an organization decides they need internal diversity when they meet external stakeholders who are diverse. Those stakeholders need to be interacted with by someone like them, so African-Americans need to be interacted with by African-Americans. I think the danger there is that it pigeonholes people.

The way I look at it is, if our customer base is diverse, we need diversity in our workforce so that we can learn from our own diversity to make ourselves more effective at meeting the needs of our clients. I, as an African-American male, will never be Asian, but if I’m in a diverse work group where we can actually talk about cultural differences, I can become much more effective relating to that Asian client. But if we’re homogeneous inside, then we’re likely to make all kinds of mistakes in the way we think about diversity.

The most effective organizations, in my view, are organizations that don’t simply use their diversity in order to have legitimacy with clients, but use their diversity to increase the cultural competence of their workforce, writ large.

I think that identity will increasingly be part of the conversation. What it means to be a diverse and inclusive place is not simply that you have people who look different, but that you have created an environment where people feel like, at the end of the day, they are who they are, uniquely, and in a way that integrates them, and that they’re not trapped in a box. We’re going to have to find a way to talk about diversity that isn’t just about categories, but it’s about the kind of organizations we want to create for people to be able to bring their identities to work and to be, if you will, whole people. And that’s really what I think is the future of the work around diversity.

Diversity of Thought and Innovation
Richard Boyatzis
Distinguished University Professor, H.R. Horvitz Chair of Family Business, Professor in the Departments of Organizational Behavior, Psychology, and Cognitive Science, Weatherhead School of Management, Case Western Reserve University

What do business leaders need to understand about diversity?

I think some of the most profound diversity we experience in life has to do with diversity of thought. Diversity initiatives can have important and interesting social justice benefits, but the real reason you want to pursue diversity programs is for innovation. You want diversity of thought. Here’s the key: If you want diversity of thought, you have to bring in people around you who have diverse experiences. Differences in race, gender, and socioeconomic background are three characteristics, but so are differences in learning style or differences in professional field. And I’m not suggesting that any one of those points of diversity is more potent than others.

If a group has an ability to create dialogue, diversity of thought helps them not get into groupthink. On the whole, almost everybody knows the difference between right and wrong. So how do you help people, in the heat of the moment, when they let go of that and use some form of contingent morality or expediency or self-justification as an argument to do something that ends up being a bad thing? We need to teach people to have better conversations, more dialogue, with people who have differing views. How else can you get somebody to say, “I’m not sure that really is the best way to go” or “We’ve had this whole conversation and we haven’t mentioned our customers once”?

There’s a performance-based argument to say that diversity of thought, diversity of perspective, diversity of opinion is really crucial. Why? Because the world changes. If you don’t have any changes in your marketplace or your competitors, if you don’t have any changes in your materials or your workforce, then maybe it doesn’t matter. But I don’t know of a business like that. One of the ways organizations adapt is by noticing what’s going on in the environment and trying new things. How do you come up with innovative ideas, unless you have a spectrum of ideas to examine?

This is where emotional intelligence and social intelligence come in. Leaders need some degree of emotional intelligence to rise above our need to justify or validate ourselves, which is what happens when we seek people who are just like us in their thinking. And we need a certain amount of social competency to be able to engage people who do have differences of ideas and perspectives.

The default condition for the human organism, neurologically and hormonally, is to protect itself. That’s what happens under chronic stress or acute stress— our body goes into a defensive posture. That defensive posture closes down our ability to learn. We go into a state of cognitive and perceptual impairment. People stick with what they know, what’s comfortable, what feels safe. Strong leaders create an environment where people don’t need to get into that defensive posture, or when they do, they pull them back out of it. That’s how you encourage diversity of thought and innovation.

Gender in the Workplace
Victoria Brescoll
Assistant Professor of Organizational Behavior, Yale SOM

What do leaders need to know about gender in the workplace?

My work looks at what happens when people behave in gender-counter-stereotypical ways. We find that when they go against stereotypes, people generally lose status. And traditional organizational power and dominance behaviors, like talking a lot or expressing anger, really only work for men.

I have a project to code C-SPAN videotapes of the Senate looking at volubility. For men, there’s a strong relationship between how much power a male senator has and how much he talks from the Senate floor. But for women, there’s practically no relationship whatsoever.

Women who know what they’re doing know it’s not a power and status behavior for them. And it may even hurt. I have other studies that show that when women dominate the conversation in a meeting or show anger, they experience status decreases.

I used to work in the Senate, and I was fascinated by how many times female senators making their standard stump speeches would talk about how they never intended to become a politician in the first place. I never saw a male senator do that. But these women are masters of impression management. They know that this is an effective way to present themselves to the public.

That was the inspiration for a study. We found that if people inferred that a woman had an intention to get power, or if she explicitly said that she was looking for a position of power, they were less likely to vote her into office. But people were more likely to vote for a man when he explicitly expressed or they inferred that he had that intention.

We think that it’s entirely driven by expectations for how men and women are supposed to act. A strong desire for power on the part of women is very much violating a gender stereotype that women should be modest and play more of a backseat role.

So, it looks like men and women should use a different set of tools if they want to get ahead or maintain their status and power. And it’s not easy, but you can predict what those will be based on whether or not certain behaviors are consistent or inconsistent with common beliefs about how men and women should behave.

When you actually ask people if women should be able to express anger at work, they say it is okay. If you ask people if they would vote for a woman who says she wants power, they’ll say yes, I wouldn’t discriminate. But when we randomly assign people to view one of the scenarios, they will show the bias against the people enacting counter-stereotypical behavior.

The simplest way that women can express anger while avoiding this bias, at least according to my research, is to offer an explicit reason, so that somebody can’t blame their anger on who they are as a person. It’s not offering an excuse, but a context. This is a great thing for women to do.

Although this research appears to be about women, it’s really about gender. In all the examples, you can say that there’s a flip side. There are things that biases dictate that men should do and women shouldn’t. And vice versa. So things like expressing sadness or asking for a lot of help in a professional context might not be good tactics for men.

Diversity Initiatives at One Company
Niloufar Molavi
Tax Partner and U.S. Chief Diversity Officer, PricewaterhouseCoopers

What do leaders at PwC need to know about diversity in order to be effective?

Diversity can and should be a critical component of the innovation that leaders are driving in their organization, and it can and should be a competitive advantage for them.

Research shows that diverse groups outperform homogeneous ones. I think of PwC as being in the business of serving clients; for us, innovation means solutions that we bring to our clients. And if we have people who come from different perspectives at the table, the solutions that we bring to our clients, the way we interact, and the relationships we build with our clients are going to distinguish us from our competitors.

Demographic trends indicate that women and minorities are the fastest-growing segments of the U.S. workforce, and I think that’s true globally as well. A focus on diversity and building an organization that’s culturally inclusive is going to allow you to attract and retain that top talent.

One of our goals has always been, when we think about diversity, to make sure we’re building the cultural dexterity of all our people. By cultural dexterity, we mean the ability to connect across myriad areas, backgrounds, and focuses that are different. It’s difficult to be a true leader in today’s world without a minimum level of cultural dexterity. Ultimately, we need to make sure we’re creating a culture where every individual is valued for their unique contributions and that they are able to achieve their highest potential.

For working parents, and that often tends to be working mothers, formal flexibility is very important. So we have a number of different programs allowing individuals to work reduced hours, work from home, or arrange job-sharing. One such program that we’ve been really excited about, Full Circle, allows parents to off-ramp from their careers for up to five years, and then return to the firm. Individuals that enter this program are assigned a PwC coach and have access to all the training that the firm provides to keep their skills current. They stay connected with the firm. And when they choose to come back, they can.

More than half of our new hires are women. And more than 30% are minorities. A lot of our focus, now that we are attracting diverse individuals to the firm, is continuing not only to retain them, but really getting these individuals into leadership positions.

We have a mobile workforce engaged with our counterparts and clients around the globe. It’s challenging, because diversity doesn’t mean the same thing across the globe. Certain dimensions of diversity, for example, gender, resonate. Beyond that and a few others, you really have to look at what elements of diversity become important in a given jurisdiction. In Nigeria, dealing with race is not the issue, but dealing with tribal differences is very important. You want to make sure it’s relevant. That’s why we continue to talk about cultural dexterity, because that resonates no matter where you are and what the specific facts may be in those local markets.

Overall, looking at the big picture, the initiatives that we’ve put into place focus on flexibility. The way we look at it is one size doesn’t fit all.

Supervising Older Workers
Peter Cappelli
George W. Taylor Professor of Management, The Wharton School, University of Pennsylvania

What do leaders need to know about older workers?

The evidence on discrimination for older workers is that it’s a bigger issue than for any other group, bigger than for gender, bigger than race. I think the discrimination is just so prevalent that people don’t even recognize it. It affects primarily people getting jobs in the first place, but the scope of claims of age discrimination has been rising in the downturn, because there are more age-related dismissals.

There are also problems for older people who are employed. Performance appraisals of older employees tend to be worse, independent of actual performance. And problems of performance are attributed to age for older workers where they’re not for younger employees.

Data show older employees perform better on almost all dimensions of performance. Absenteeism is lower. Turnover is lower. Interpersonal skills are better. Job performance in general is better. The only thing that younger people do better on, among any of the tasks that might even loosely be related to jobs, is solving novel problems under time pressure without assistance like calculators. So that’s basically taking SAT tests. While we obsess over the differences between Generations X, Y, and Z, we’re ignoring what to do to tap into a huge and growing population of older workers.

There are structural management practices one can use to avoid unconscious biases in efforts to recruit people. But I’d say the biggest issues have to do with direct management. Having a younger supervisor manage an older subordinate is in some ways a reversal of the historic norms. In some cases, it makes the older subordinates uncomfortable. But we know it makes the younger supervisors uncomfortable. And this is the heart of much of the discrimination; younger supervisors say, “I don’t see how I can manage somebody who has been doing this job longer than I’ve been.” Or they say, “They’ve been doing this job longer than I have and they’re still doing it—there’s got to be something wrong with them.”

For quite a while, the military has had the challenge of young second lieutenants being in charge of older, experienced sergeants. What they’ve learned is that the second lieutenants have really got to manage with more of a partnership model in mind, recognizing the expertise of the sergeant, consulting them, and making decisions jointly.

At the same time, the supervisor is still in charge. Often one of the problems we see with younger supervisors is that they just abdicate management of older subordinates. We know that younger supervisors tend not to give as much praise to older subordinates, and we know that they tend to be biased in the attributions they make concerning performance. Older subordinates are less likely to be told that the problem could be fixed by training. There’s more likely to be a conclusion this is just dispositional—“You’re just a bad worker.”

The engagement model that I’m describing for how to manage people is a model which pretty much works everywhere. The difference is that with younger subordinates, you can more easily get away with supervisory practices which we could describe as not so good, like just telling people, “Do this because I said so.” You can’t do that with more experienced subordinates.

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I chose articles dealing with diversity because I believe that this is a organizations biggest asset to have. The articles detail how companies have a distinct advantage over its competition if it has a more diverse workforce. Showing how companies manage different age groups, ethnicity, gender, and backgrounds to come up with new and innovative ideas to help an organization prosper.

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10 Rules for Managing Global Innovation
Keeley WilsonYves Doz

Companies are well aware that hidden in their dispersed, global operations is a treasure trove of ideas and capabilities for innovation. But it’s proving harder than expected to unearth those ideas or exploit those capabilities in global innovation projects. Some of the challenges of global projects are familiar: figuring out the right role for top executives, for example, or finding a good balance between formal and informal project management processes.

But although the challenges may be familiar, the solutions are not; what works for an innovation project conducted in a single location doesn’t necessarily work for one dispersed across many sites around the world. That’s partly because many important enablers of innovation happen naturally in colocation. Single location projects draw on large reservoirs of shared tacit knowledge and trust, and when issues arise, senior management is on hand to make decisions and provide direction and support. Team members share the same language, culture, and norms, enabling flexibility and iterative learning as the project unfolds.

When a project spans multiple locations, many of those natural benefits—often taken for granted—are lost. Part of the challenge of dispersed innovation thus becomes how to replicate the positive aspects of colocation while harnessing the unique benefits of a global initiative. To explore this challenge, we spent more than a decade doing field research at 47 companies around the world, including Citibank, HP, Hitachi, Infosys, Intel, LG Electronics, Novartis, Philips, Samsung, Siemens, Vodafone, and Xerox. In 2004 we teamed up with Booz & Company to conduct a global survey that was completed by 186 companies from 19 countries and 17 sectors, with a combined innovation spend of more than US$78 billion. We draw on that work to present a set of guidelines for successfully managing global innovation projects.

1. Start Small
One of the chief enablers of dispersed innovation is the experience of the participating sites in working on global projects. No matter how strong technical capabilities or customer knowledge may be at a particular site, employees will struggle to make a contribution to a global project commensurate with their skills if they have had experience only in colocated development. That’s because on single location projects, team members benefit from collective tacit knowledge and a shared context, both of which support rich communication and help build trust and confidence among coworkers. Projects that span multiple sites and time zones are often hobbled by differences in workplace practices, communication patterns, and cultural norms. In the absence of everyday interactions and encounters, people struggle to signal trustworthiness and demonstrate competencies. Making matters worse, many teams are used to competing for resources with teams at other sites, and this creates yet another barrier to trust and collaboration between sites.

To be effective, dispersed teams have to develop a new set of collaboration competencies and establish a collaborative mind-set. This can be done by running small, dispersed projects involving just two or three sites before a project launch. Schneider Electric and Toshiba, two global electronics manufacturers, took this approach when they formed a joint venture, STI, to develop electrical drives and inverters. Although management was enthusiastic about the new partnership, engineers at the two companies were not. To build trust between sites, STI organized a series of small, noncritical joint projects under the close scrutiny of senior managers. By the end of the first project, the teams had already begun to feel comfortable collaborating with colleagues at other sites. They quickly established consensus on working practices and protocols, reinforcing trust and providing a good foundation for the more complex global initiatives to come.

Managers must anticipate the possible toxic side effects of organizational change and shelter their global teams as much as possible.

2. Provide a Stable Organizational Context
During periods of major organizational change, such as restructurings or acquisitions integration, the complexity of dispersed innovation escalates. Top managers are likely to be focused elsewhere within the organization, leaving their global projects orphaned. Critical decisions are frequently left hanging, and problems often go unaddressed. In a climate of organizational uncertainty, turf battles can flare up, and project team members may become concerned about job security and lose focus.

Consider a global electronics firm we’ll call Elecompt. It launched a global innovation project at a time when new acquisitions were being integrated and a major reorganization of R&D was under way. Although the project was of strategic importance, management focus was understandably elsewhere. Problems came to a head when, prompted by fear of job losses, large numbers of highly skilled engineers at one site left the company, causing significant delays.

Of course, it’s not possible to undertake global innovation projects only in times of sustained stability, so managers need to anticipate the possible toxic side effects of reorganization on global innovation and shelter teams as much as possible from disruptions. They should focus on creating an atmosphere of stability and bolster employees’ sense of self-worth and loyalty to the firm. This will be particularly important for firms that are expanding R&D in China, where competition for talent is so intense that loyalty to employers rarely has time to develop.
3. Assign Oversight and Support Responsibility to a Senior Manager
When the knowledge base underlying a project is fragmented and project teams are scattered over multiple locations, miscommunication, conflict, and stalemates over crucial decision making are much more likely. Project teams often struggle to handle these problems constructively over a distance, especially when disagreements become personal, and so senior managers have to take on a formal role as arbiter, risk manager, support provider, and ultimate decision maker.

Contrast this with the more familiar world of single location projects, where senior managers can give the go-ahead to an innovation project and then step back and let the team get on with it. This hands-off approach works because on-site executives can rely on informal communication and feedback mechanisms to maintain oversight. Being on the spot, they’re more likely to become aware of difficulties early on and can intervene when necessary to resolve them.

Companies that are smart about global innovation create an explicit role for senior executives in their projects. For example, at Essilor, a global corrective lens manufacturer, an executive team member is assigned to head up every international project. He or she monitors project progress and is responsible for making key decisions and ensuring that the project meets the firm’s strategic objectives.

Essilor undertook a project to develop photochromic lenses with partners PPG and Transitions Optical. The project involved more than 20 sites around the world. To ensure first mover advantage, the schedule was extremely aggressive. Once the project was under way, it became clear that to hit the launch date, the production ramp-up phase would have to be reduced. This could be achieved only by taking shortcuts in the production validation and evaluation processes. None of the managers of the 18 production facilities were comfortable with that kind of risk.

With loose executive oversight and unclear decision rights, the project might have stalled or derailed before the issue came to the attention of senior management. But the executive responsible for the project saw the dilemma immediately and took it to the executive committee. Because time to market was critical, the committee agreed to the shortcuts and made it clear that the risk belonged to the project, not to the production sites. The problem was resolved without any disruption to the work flow, and the product was launched on schedule.

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4. Use Rigorous Project Management and Seasoned Project Leaders
In addition to a fully engaged senior manager, a global innovation project requires a strong project management team to drive the project on a day-to-day basis and strong team leaders supported by robust tools and processes. These are necessary to impose discipline, structure, and a shared sense of purpose across the locations.

Firms can approach these challenges in a number of ways. Some adopt rigorous quality programs to provide formal project management for global projects. Siemens uses Design for Six Sigma to define common analytical tools, provide coaching, and set targets and timetables for feedback meetings. Those processes are then adopted across all sites.

Alternatively, firms can build a corporate project-management capability. Essilor, the lens manufacturer, has a corporate unit that runs global projects. The unit includes staff members from all functions and geographies—many of whom spend several years as project managers of global innovation efforts before returning to their area of specialty. These positions are desirable ones: Project managers value the opportunity to work closely with the senior executives assigned to their projects. And because the roles involve extensive travel and exposure to different parts of the firm, project managers leave the unit having built strong cross-cultural skills and robust relationships and networks all over the world.
It’s important to note that global innovation projects are so complex that standard tools and processes don’t always work well. At the joint venture STI, a project manager realized that misunderstandings resulting from e-mail communication between teams were causing the schedule to slip. With senior management support, he successfully introduced a protocol requiring that all initial communication on a topic be voice-to-voice. At the software firm Synopsys, the global development of a new product ran in parallel to the incremental development of an existing product, a traditional approach at many firms. Concerned that this would lead to an “us versus them” culture, the project manager organized work spaces to mix up the two teams.

5. Appoint a Lead Site
Each site involved in global innovation will see the project through the prism of its own contribution and context, rather than putting the bigger picture first. That’s why all sites can’t carry equal weight, even if their experience and expertise are equivalent; one has to be designated the lead. That site takes responsibility for delivering the project on time and on budget.

Let’s compare the approaches taken by Elecompt on its global project and by Schneider on its STI joint venture with Toshiba. Each site involved in the STI project was a global leader in its field. However, the French site, which had been heavily involved in defining the new product requirements, was given responsibility for the project: coordinating the project management team, integrating the work of the other sites, and making final decisions. Having a clear lead site ensured prompt decision making and a project successfully delivered on time and on budget.

At Elecompt, each site had equal weight in making decisions and managing the project. That meant that every decision and aspect of cooperation had to be negotiated among multiple sites, at best a slow and cumbersome process. With each site defending its own corner, stalemates were common. One engineer noted that “there was an escalation of problems without corresponding solutions.” Two years into the project and with renewed senior management focus, the necessary management structures were finally put in place to enable the project to progress.

6. Invest Time Defining the Innovation
Anyone who has worked on a single location project knows that the product or service delivered isn’t always what was anticipated at the outset. This is actually one of the great benefits of colocation innovation. Because everyone involved is under the same roof and in frequent communication, continuous learning and adaptation can take place, allowing the design of the product or service to improve over the course of the project.

When a project is split over time zones, cultures, and languages, there is very little latitude for iterative learning. Instead, everything must be defined up front: the product or service architecture, the functionality of individual modules, and the interdependencies and interfaces between modules. In addition, process flows, timelines, and knowledge requirements need to be thoroughly understood so that everyone working on the project has the same understanding of the goals and their individual contributions to them.

Although there is a natural temptation to dive into development as soon as possible, studies show a positive correlation between investment in defining goals and technical specifications and the successful outcome of projects. In the case of Essilor’s photochromic lens, despite having less than two years to deliver the new product, the project team invested nine months in defining the modules and multiple interfaces that would be handled by specialist teams from around the world, thereby building a solid foundation for success.

During the definition process, representatives from each project team were colocated for short periods of time. In addition, the constantly globetrotting project managers held frequent on-site meetings and spent time conferring face-to-face with team members. We believe that a global project can’t be effectively defined without some degree of colocation between the different functions and sites involved. Colocation builds relationships and trust up front and supports the sharing of complex ideas and concepts.

If teams are selected merely because they are available rather than for their distinct capabilities, the project will take on a lot of risk for little benefit.

7. Allocate Resources on the Basis of Capability, Not Availability
The question of how best to staff a project rarely arises when only one location is involved: That location has presumably been chosen because the teams there have the requisite skills and experience. The effective staffing of a global project, however, requires a great deal of attention in order to select and integrate the best possible knowledge and capabilities.

But all too often, firms see global projects as an opportunity to make the most efficient use of human resources. Teams are selected not because they are the best qualified but because they are available at the time. The consequences of this approach can be seen in the Elecompt project. One of the sites, a U.S. team, was asked to develop a critical piece of software because it had the most staff availability, even though it lacked the required experience, and it struggled as a result. Eventually, when resources became available elsewhere, this module was moved to a team that had the necessary capabilities—but by then, morale had been dented, time wasted, and costs increased.

This availability approach to staffing projects completely undermines the basic rationale for global innovation—to bring together distinctive and differentiated knowledge and capabilities from around the world to create unique innovations. If teams are selected merely because they aren’t doing anything else at the time rather than for their distinct capabilities, the project will take on a lot of risk for little benefit.

8. Build Enough Knowledge Overlap for Collaboration
Although sites involved in a project should be selected on the basis of the unique capabilities and knowledge they can bring, there also has to be a small degree of knowledge overlap between sites. Without this, critical interdependencies between modules may not be apparent until the integration phase, when problems are costly to rectify. This doesn’t mean replicating the other sites’ knowledge, but understanding enough of what they do to anticipate potential interdependencies and interfaces in the development process.

At Siemens, virtual cross-functional teams provide knowledge overlaps to help avoid such problems. Each module is developed by a specialist team and overseen by a virtual team comprising representatives from each of the other modules. This allows potential problems to be flagged and resolved as they arise.

9. Limit the Number of Subcontractors and Partners
In most innovation projects today, part of the work is outsourced or undertaken by development partners in order to access specific competencies, reduce development time, or cut costs. The final consideration in staffing global projects is selecting these external collaborators.

Managing relationships with external parties takes time and energy. So it makes sense in global projects to limit the additional complexity and management burden by keeping the number of subcontractors or partners to a minimum. And just as it’s essential to use internal sites that have experience working together, it’s easier and less risky to turn to external firms that are trusted and familiar. Choosing partners or subcontractors located close to one of the internal project sites will likewise reduce the potential for cross-cultural misunderstandings and will support face-to-face communication.

Projects should include generous travel budgets for face-to-face site visits, team meetings, and temporary transfers for key team members.

An example of the problems that can be caused by involving too many distant external partners in an innovation project can be clearly seen in Boeing’s 787 Dreamliner project. This ambitious effort aimed to develop a new plane with significantly reduced operating costs by using innovative composite materials. The project involved over 50 main partners across the U.S., Europe, and East Asia, each charged with developing different subsections.
Coordinating that many partners was difficult, and Boeing had little insight into what was happening at each site. Integration proved extremely complex and constant modifications were required—for example, the new materials initially made it impossible to attach the wings to the fuselage. To get the project back on track, Boeing resorted to colocating its partners for six months. Although the final product was a success, it was delivered almost three years late, during which time Boeing lost orders to the Airbus A350.

10. Don’t Rely Solely on Technology for Communication
In the end, the successful execution of a global project remains dependent upon communication channels that go as far as possible to replicate the richness of colocated communication. In single locations, a shared context—cultural, organizational, functional, and technological—makes it easier to discuss complex ideas and resolve problems informally. Because communication in this environment is second nature, managers tend to underestimate the challenge of scaling communication globally.

Information and communications technologies, or ICTs, including e-mail, web meetings, social media platforms, online forums, and video conferencing certainly have a role to play, but those tools shouldn’t be overrelied on, because they tend to mask differences between locations, leading to misunderstandings and tension. In addition to ICTs, the communication armory for a global innovation project should include a generous travel budget for face-to-face site visits, project team meetings, and temporary transfers for key people. Also, to encourage team members to feel an allegiance and sense of belonging to a global project rather than their local site, a web of cross-site reporting lines can be put in place. This has the added advantage of forcing communication and knowledge sharing.

Successful globally integrated firms understand the importance of an extensive communications approach. Tata Communications, for example, has a highly dispersed structure that enables it to access the best competencies and market knowledge around the world. Even its top management team is dispersed across the globe. The company has invested in a raft of ICTs to support everyday collaboration, but this is in addition to hefty travel budgets for vital, regular face-to-face communication to drive projects forward, share knowledge, and reinforce trust.Together, the 10 steps we have outlined represent the foundation for successful global innovation projects. Adopting only one or two may result in fleeting success in some projects but will not produce a stream of positive outcomes. These best practices all need to be put in place and honed over time. It’s not easy to build a global innovation capability, but for companies that don’t have the skills and processes in place to manage global innovation projects, the future offers a stark choice: Continue with only colocated projects, in the hope that they will fill the innovation pipeline for a few more years until global competition intensifies and makes local innovation a niche activity. Or begin building a capability in global innovation now to take advantage of lower development costs, faster time to market, and, most important, the ability to leverage dispersed knowledge to gain competitive advantage.

A version of this article appeared in the October 2012 issue of Harvard Business Review.

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Article McKinsey Quarterly June 2012
The global company’s challenge
By Martin Dewhurst, Jonathan Harris, and Suzanne Heywood
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As the economic spotlight shifts to developing markets, global companies need new ways to manage their strategies, people, costs, and risks.

Managing global organizations has been a business challenge for centuries. But the nature of the task is changing with the accelerating shift of economic activity from Europe and North America to markets in Africa, Asia, and Latin America. McKinsey Global Institute research suggests that 400 midsize emerging-market cities, many unfamiliar in the West, will generate nearly 40 percent of global growth over the next 15 years. The International Monetary Fund confirms that the ten fastest-growing economies during the years ahead will all be in emerging markets. Against this backdrop, continuing advances in information and communications technology have made possible new forms of international coordination within global companies and potential new ways for them to flourish in these fast-growing markets.

There are individual success stories. IBM expects to earn 30 percent of its revenues in emerging markets by 2015, up from 17 percent in 2009. At Unilever, emerging markets make up 56 percent of the business already. And Aditya Birla Group, a multinational conglomerate based in India, now has operations in 40 countries and earns more than half its revenue outside India.

But, overall, global organizations are struggling to adapt. A year ago, we uncovered a “globalization penalty”: high-performing global companies consistently scored lower than more locally focused ones on several dimensions of organizational health.1 For example, the former were less effective at establishing a shared vision, encouraging innovation, executing “on the ground,” and building relationships with governments and business partners. Equally arresting was evidence from colleagues in McKinsey’s strategy practice showing that global companies headquartered in emerging markets have been growing faster than counterparts headquartered in developed ones, even when both are operating on “neutral turf”: emerging markets where neither is based (see “Parsing the growth advantage of emerging-market companies”).

Over the past year, we’ve tried to understand more clearly the challenges facing global organizations, as well as approaches that are helping some to thrive. Our work has included surveys and structured interviews with more than 300 executives at 17 of the world’s leading global organizations spanning a diverse range of sectors and geographies, a broader survey of more than 4,600 executives, and time spent working directly with the leaders of dozens of global organizations trying to address these issues.2
Clearly, no single organizational model is best for all companies handling the realities of rapid growth in emerging markets and round-the-clock global communications. That’s partly because the opportunities and challenges facing companies vary, depending on their business models. R&D-intensive companies, for example, are working to staff new research centers in the emerging world and to integrate them with existing operations. Firms focused on extracting natural resources are adapting to regulatory regimes that are evolving rapidly and sometimes becoming more interventionist. Consumer-oriented firms are facing sometimes-conflicting imperatives to tailor their businesses to local needs while maintaining consistent global processes.

Another reason no single model fits all global companies is that their individual histories are so different. Those that have grown organically often operate relatively consistently across countries but find it hard to adjust their products and services to local needs, given their fairly standardized business models. Companies that have mainly grown through M&A, in contrast, may find it easier to tailor operations to local markets but harder to integrate their various parts so they can achieve the potential of scale and scope and align a dispersed workforce behind a single set of strategies and values.

Although individual companies are necessarily responding differently to the new opportunities abroad, our work suggests that most face a common set of four tensions in managing strategy, people, costs, and risk on a global scale. The importance of each of these four tensions will vary from company to company, depending on its particular operating model, history, and global footprint. (For more on the implications of these uneven globalization efforts, see “Developing global leaders.”) Taking stock of the status of all four tensions can be a useful starting point for a senior-management team aiming to boost an organization’s global performance.

Strategic confidence and stretch
Being global brings clear strategic benefits: the ability to access new customer markets, new suppliers, and new partners. These immediate benefits can also create secondary ones. Building a customer base in a new market, for example, provides familiarity and relationships that may enable additional investments—say, in a research center.

But being global also brings strategic challenges. Many companies find it increasingly difficult to be locally flexible and adaptable as they broaden their global footprint. In particular, processes for developing strategy and allocating resources can struggle to cope with the increasing diversity of markets, customers, and channels. These issues were clear in our research: fewer than 40 percent of the 300 senior executives at global companies we interviewed and surveyed believed that their employers were better than local competitors at understanding the operating environment and customers’ needs. And barely half of the respondents to our broader survey thought that their companies communicated strategy clearly to the workforce in all markets where they operate.

People as an asset and a challenge
Many of the executives we interviewed believed strongly that the vast reserves of skills, knowledge, and experience within the global workforce of their companies represented an invaluable asset. But making the most of that asset is difficult: for example, few surveyed executives felt that their companies were good at transferring lessons learned in one emerging market to another.

At the same time, many companies find deploying and developing talent in emerging markets to be a major challenge. Barely half the executives at the 17 global companies we studied in depth thought they were effective at tailoring recruiting, retention, training, and development processes for different geographies. An emerging-market leader in one global company told us that “our current process favors candidates who have been to a US school, understand the US culture, and can conduct themselves effectively on a call with head office in the middle of the night. The process is not designed to select for people who understand our market.”

One of our recent surveys showed how hard it is to develop talent for emerging markets at a pace that matches their expected growth. Executives reported that just 2 percent of their top 200 employees were located in Asian emerging markets that would, in the years ahead, account for more than one-third of total sales. Complicating matters is the fact that local highfliers in some key markets increasingly prefer to work for local employers (see “How multinationals can attract the talent they need”). Global companies are conscious of this change. “Local competitors’ brands are now stronger, and they can offer more senior roles in the home market,” noted one multinational executive we interviewed.

Scale and scope benefits, complexity costs
Large global companies still enjoy economic leverage from being able to invest in shared infrastructure ranging from R&D centers to procurement functions. Economies of scale in shared services also are significant, though no longer uniquely available to global companies, as even very local ones can outsource business services and manufacturing and avail themselves of cloud-based computing.

But as global companies grow bigger and more diverse, complexity costs inevitably rise. Efforts to standardize the common elements of essential functions, such as sales or legal services, can clash with local needs. And emerging markets complicate matters, as operations located there sometimes chafe at the costs they must bear as part of a group centered in the developed world: their share of the expense of distant (and perhaps not visibly helpful) corporate and regional centers, the cost of complying with global standards and of coordinating managers across far-flung geographies, and the loss of market agility imposed by adhering to rigid global processes.

Risk diversification and the loss of familiarity
A global company benefits from a geographically diverse business portfolio that provides a natural hedge against the volatility of local growth, country risk, and currency risk. But pursuing so many emerging-market opportunities is taking global companies deep into areas with unfamiliar risks that many find difficult to evaluate. Less than half of the respondents to our 2011 survey thought these organizations had the right risk-management infrastructure and skills to support the global scale and diversity of their operations.

Furthermore, globally standard, exhaustive risk-management processes may not be the best way to deal with risk in markets where global organizations must move fast to lock in early opportunities. One executive in an emerging-market outpost of a global company told us “a mind-set that ‘this is the way that we do things around here’ is very strongly embedded in our risk process. When combined with the fact that the organization does not fully understand emerging markets, it means that our risk process might reject opportunities that [the global] CEO would approve.”

Understanding these tensions is just a starting point. Capturing the benefits and mitigating the challenges associated with each will require global companies to explore new ways of organizing and operating.

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Managing Ethics Consistently in a Global Organization

November 22, 2017
There are many reasons why your organization should pursue a cohesive culture. Codes of conduct are reassuring to investors and other stakeholders that may be critical to your organization. Customers tend to prefer organizations with demonstrable ethical values and people prefer to work for such organizations. A strong and cohesive ethical approach helps employees act decisively and can help your brand avoid reputation damage.
It’s particularly challenging for large global organizations to install a cohesive house culture across all of its areas of operation. Achieving global consistency of approach to ethical matters takes vision. If your brand is to live its values consistently, it needs strong leadership on ethical matters wherever it is active.

Global organisations also need to find ways to effectively monitor their ethical compliance performance across all areas of operation. A study by Deloitte found that only a minority of organisations manage to do this on a regular basis.

In fact, 25% of respondents to their global survey admitted that no monitoring took place. That’s particularly concerning considering that the majority of decision-makers they spoke to worked in financial services.

Challenges to ethical working
One of the key failings of global organizations was the lack of clear and consistent training in ethical issues. In fact, close to a third of C-suite executives recognized their failure to implement regular training in this area. A sizeable body of respondents also felt that there were no rewards or recognition for ethical practices, so employees didn’t have any incentive to comply (besides their own consciences).

When employees have targets or goals to meet, it’s important that there’s some reward for meeting them within the ethical guidelines. Otherwise, organizations may find themselves rewarding employees for using unethical behavior in achieving their goals. This sends mixed messages to other employees that it’s ok to bypass ethical standards.

It’s vital that leadership rewards behaviors that align with the organisation’s code of conduct. It’s also vital that behaviors that challenge or violate them are addressed and penalised.

That sounds straightforward but organizations often make the error of failing to tackle challenges to its stated ethical standards. That’s always noticed by employees and is highly destructive to maintaining ethical standards across the organization.

One of the challenges faced by global organizations, in particular, is that employees regularly find themselves interacting with other organizations that have very different ethical standards to their own organizations. In these kinds of situation, it’s absolutely vital that employees have a clear set of directives backing them up as they negotiate the ethics of dealing with third parties.

Organisations that aren’t giving firm guidance in this area are making it hard for their employees to resist pressure to act in contravention of good ethical practice.

It leaves employees in the uncomfortable position of not knowing how they are expected to behave – which makes them more likely to be swayed by external contacts into behaving unethically. “Everyone else is doing it” is a hard argument to resist.

Resisting pressure
One UK-based private equity firm venturing into the Latin American market during a boom period found its ethical standards were repeatedly tested. Practices such as keeping false accounts for the purpose of tax evasion and the casual acceptance of bribery to smooth transactions with authorities seemed to be common in the new market.

The team was under shareholder pressure from home to deliver results in the new market, but they felt the only way to do this was to conform to the market’s own ethical standards.

It was essential for central management to clearly articulate the standards that were expected of the team in order to back them up and guide them in uncertain situations. By proving clear ethical guidance, this helped make it clear to the local team that they weren’t expected to violate the ethics of the home market in order to get results in the new market.

In this particular case, the private equity firm actually pulled out of the market because they saw no way to achieve their goals without violating their own ethical guidelines. That’s an extreme measure to take but it was the ultimate test of the firm’s ethical standards.

A united front
Whether businesses operate across multiple markets or just in a domestic capacity, they are still likely to employ people from many different cultures. Truth and honesty are relative ideals.

In some countries, bribes are not only allowed – they are also tax deductible as a business expense. Cynics may even say that bribery and corruption are endemic the world over; only the degree of sophistication by which it is concealed varies.

It’s important to articulate exactly what is accepted practice in your organisation but also to ensure that everyone understands ethical behavior in the same way. For example, what constitutes an acceptable corporate gift? Many organisations find it helpful to set thresholds for gift value in order to provide clarity.

Your organization may find local practices vary when it comes to matters such as cultivating relationships with authorities outside the organization. Your local teams will benefit from firm guidelines on what is acceptable within the wider organization.

Organisations need to take a firm stance if behavior that is considered acceptable locally is not acceptable in other key markets. It’s an important way to protect your organisation’s reputation in all the markets it operates in.

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Learn.Org

What Is Global Management?
Global management refers to the way an organization manages its business internationally, including its sales, marketing, hiring and finance practices. Many schools offer training and degree programs in global management. Read on to learn more about responsibilities in this field of management and education programs that can prepare you to enter this career. Schools offering International Business degrees can also be found in these popular choices.

Overview of Global Management
As technology continues to connect the world, many organizations have taken advantage of the opportunity to conduct business globally. Global management combines knowledge of business, culture, history and social practices to help companies find their niches in the international business community and successfully work with other cultures.

As a global manager, you'll not only need to understand business principles, but you'll also need a firm grasp of the local customs, professional life and regional policies of the countries that your company wants to partner with. Many companies also look for managers who speak multiple languages and have experience representing more than one country, as well as those who are willing to move from one location to another.

Important Facts About Global Managers
Median Salary (2015) $98,088 ('for all global account managers')
Key Skills Bilingual, clear written and spoken communication, attention to detail, problem solving, social awareness, leadership, organization, observation, negotiation
Work Environment Predominately office settings with extensive travel mixed in
Similar Occupations Account executives; account mangers; business development directors; directors of sales and marketing; general / operations managers; national account managers
Source: PayScale.com

Job Duties and Skills
Working as a global manager, you'll be in the unique position of managing a company's business and staff in a land that may have vastly different cultural and professional customs. In many regions, managers are needed to help companies tailor their business to the local culture. For example, as a global manager, you might need to learn the hiring practices of another country or the specific way that people communicate in the workplace to avoid potentially offending or confusing your foreign colleagues. You'll then need to train other employees in appropriate practices, such as pitching products to foreign customers in a polite manner consistent with their culture.

In order to carry out their jobs effectively, global managers need strong communication and interpersonal skills. They need to be highly sensitive to and respectful of cultural differences. Having an open mind and complex critical thinking skills is also essential.

Training Programs
If you want to receive a global management education, graduate programs are offered by a number of accredited business schools. Some bachelor's degree programs are available, though graduate certificate and degree programs are the most commonly offered. Global management training can be offered as part of a Master of Business Administration (MBA) or Master of Public Administration (MPA) program. You also can earn a Master of Science in Global Management.

These programs can introduce you to the social customs and business practices of different countries, teach you about international commerce and show you how to conduct business in foreign languages. Coursework may cover international human resources management, global supply chain management, foreign income taxes and international negotiation. Many schools can also offer you the opportunity to study abroad or complete an internship experience overseas.

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The articles I have chosen gives you the advantages and disadvantages of managing an organization overseas. The overwhelming idea is to do lengthy research before starting, and managing a business overseas. Learn the laws and customs, know the workforce habits, and most of all find out the financial structure of the country you want to invest or manage in.

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Quality Management for the Future
Old dogs can learn new tricks.
October 2, 2014
Mark A. Nash

Quality cops and the quality patrol. These are just two of the many names quality managers and technicians have been called over the past 70-plus years. Yet, as quality concepts and efforts as a whole have evolved throughout the past century, the role of the quality manager, or more appropriately the quality professional, has not. However, a recent trend within the ranks of quality professionals appears to show that even the old dogs in the quality world can indeed learn new tricks. But, to truly understand the significance of this shifting of approach within quality, a history lesson is in order.

The History of Quality in the US

Quality was a major concern of manufacturing during World War II, since the need for ammunition that was reliable in firearms from various gun makers was critical to the war effort. Walter Shewart’s statistical sampling techniques and the creation of military-specification (Mil-Spec) standards became the core of the quality system created during the war. To define standards, develop sampling requirements, measure outcomes, and generally enforce the rules of the quality program, the role of the quality professional within the organization quickly matured to one of definition and enforcement.

TECH TIPS
The role of the quality professional must become that of teacher and mentor, coach and player.

The quality manager’s role is shifting from sitting in the quality office telling employees that they have a defect to one of helping employees find the root cause of the defect, working in partnership to find a solution, and implementing that solution.

They must ensure that the employees understand the effects of both the defect and the solution.

The quality movement in the United States secured a stronger role within companies in the 1970s as the concept of Total Quality Management (TQM) emerged as the quality methodology that would provide U.S. companies with the necessary edge to compete against the ever-growing competition from Japan. The approach to quality preached by Joseph M. Juran and W. Edwards Deming, embraced by the Japanese after World War II, had largely been ignored in North America. This all began to change as the whole-organization approach embracing quality circles and quality teams brought the concept of total quality to the forefront.

Looking Back at Missed Opportunity

The obvious problem, in hindsight, is that the role of the quality professional under the TQM methodology never changed in most companies; even as the thought processes and interest level of employees and managers throughout the organization were shifting in a positive direction. Quality managers continued to be in the role of defining and enforcing quality—not improving quality. This is not to say that quality professionals were not getting results; they were. But, where Juran and Deming’s concepts were embraced by the Japanese, the U.S. quality movement was slow to respond to these concepts. In part, this compartmentalized structure where the quality staff retained the power and company employees and management alike had little ownership contributed to TQM being labeled as a fad by the late 1990s.

A Shift in Mindset

However, as the acceptance of lean manufacturing (lean healthcare, lean distribution, lean enterprise, etc.) and the problem solving power of Six Sigma have both found a place in the quality world, the role of the “quality team” has begun to change. This change is being driven from both the quality office and the C-suite in many companies. Just as many people envisioned with TQM, quality is now truly becoming a partnership comprised of all parts of the company.

What does this shift in methodology mean for the professional quality manager? The quality team, both managers and technicians, can no longer be just the enforcer. These dedicated employees, who once decided what was good and what was defective, must expand their contributions to the organization. The role of the quality professional must become that of teacher and mentor, coach and player. The quality manager’s role is shifting from sitting in the quality office telling employees that they have a defect to one of helping employees find the root cause of the defect, working in partnership to find a solution, implementing that solution, and ensuring that the employees understand the effects of both the defect and the solution on the organization.

Darin Craig, facility quality manager at OneSubsea, an oilfield equipment manufacturer in Brazil, has stated that the future of quality is in an “Integrated Business Quality” system. “This model focuses on the success of the business by integrating the traditional quality roles and adding a bias for action that improves the financial performance of the company.”

“Instead of: We found a defect. Here is what management needs to do to fix the process, it becomes: The process identified a defect. When we implemented the improvement, we saved the company X dollars and increased productivity Y percent.” Craig continues, “This Integrated Business Quality model will not only improve the financial performance of the company, but will also improve our (quality professionals’) image, credibility and leverage to make bigger and better improvements.”

Lean and Six Sigma’s Impact

Many quality managers, such as Craig, who are well versed in lean and/or Six Sigma, and embrace the process ownership by employees concept, have begun to push this effort of a “quality partnership” throughout the company. Where lean implementation has been successfully sustained, a key component is always employee involvement and process ownership. When employees can improve a process and drive out waste (which includes defects) without the quality department or management watching over their shoulders, the pride and desire to succeed is evident over the long-term. The gains can be even greater if quality managers and technicians, without ego or ulterior motives, can become a part of these teams. When quality concepts and techniques are represented as a part of the team, as opposed to being the giant stick over everyone’s head, solutions analyzed and implemented are generally stronger.

Six Sigma has also contributed to the rise of this shift in quality management. However, the effect has been a learned perspective through trial and tribulation. Over the past decade, many organizations around the world have jumped on the Six Sigma bandwagon. As with all process/quality improvement methodologies introduced to the business world, some companies adopted Six Sigma simply because it was the “flavor of the month.” Others earnestly became Six Sigma companies wanting to solve difficult defect and variation problems, only to see solutions not sustained in the long-run. As a result, many of these companies have also abandoned their Six Sigma efforts.

But, quality managers who understand the importance of employee buy-in and process ownership have done an admirable job of learning from others’ misfortune. The secret to any and all quality/process improvement effort is employee ownership. Employees must believe in the change process and have ownership in the process being changed. To create this ownership, it has become evident to many a quality professional that partnering with the lean and Six Sigma initiatives, as opposed to trying to “own” them, can produce significant results.

It Comes Down to Doing

The epiphany for this new way of thinking is the realization that a quality partnership within a company requires “doing.” You can no longer sit back and reject bad parts or tell management what is broken expecting someone else to fix it. Quality’s role is changing.

Steve Nixon, a lean Six Sigma master black belt, has recruited and directed teams in quality improvement efforts for multiple companies and the U.S. Army Reserve for the past 18 years. When discussing the changes he sees in quality teams and departments, he does not mince words. “Quality is doing. Reading requirements, understanding needs, and helping customers—internal and external—communicate their satisfaction with improvements. Then, you must lead the implementations that realize those expectations. Just as you cannot inspect in quality, you cannot point to failures, develop or identify a solution, and tell someone else to do it. That implementation has to be collaboration between the doers, the communicators, and the beneficiary of the improvement. And the quality professional has got to be a doer.”

As the understanding and implementation of employee-based quality and continuous improvement efforts expands, not just in the U.S. but globally, more and more board rooms and executive teams will demand that their quality teams embrace this Integrated Business Quality concept. Those quality professionals that see the power of the approach will succeed. Those that do not “get it” may find themselves retiring early. The question for the traditional quality professional is: can you learn a new trick?

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Importance of Quality Management

“Quality management” ensures superior quality products and services. Quality of a product can be measured in terms of performance, reliability and durability. Quality is a crucial parameter which differentiates an organization from its competitors. Quality management tools ensure changes in the systems and processes which eventually result in superior quality products and services. Quality management methods such as Total Quality management or Six Sigma have a common goal - to deliver a high quality product. Quality management is essential to create superior quality products which not only meet but also exceed customer satisfaction. Customers need to be satisfied with your brand. Business marketers are successful only when they emphasize on quality rather than quantity. Quality products ensure that you survive the cut throat competition with a smile.

Quality management is essential for customer satisfaction which eventually leads to customer loyalty. How do you think businesses run? Do businesses thrive only on new customers? It is important for every business to have some loyal customers. You need to have some customers who would come back to your organization no matter what.

Would you buy a Nokia mobile again if the previous handset was defective? The answer is NO.

Customers would return to your organization only if they are satisfied with your products and services. Make sure the end-user is happy with your product. Remember, a customer would be happy and satisfied only when your product meets his expectations and fulfills his needs. Understand what the customer expects from you? Find out what actually his need is? Collect relevant data which would give you more insight into customer’s needs and demands. Customer feedbacks should be collected on a regular basis and carefully monitored. Quality management ensures high quality products and services by eliminating defects and incorporating continuous changes and improvements in the system. High quality products in turn lead to loyal and satisfied customers who bring ten new customers along with them. Do not forget that you might save some money by ignoring quality management processes but ultimately lose out on your major customers, thus incurring huge losses. Quality management ensures that you deliver products as per promises made to the customers through various modes of promotions. Quality management tools help an organization to design and create a product which the customer actually wants and desires.

Quality Management ensures increased revenues and higher productivity for the organization. Remember, if an organization is earning, employees are also earning. Employees are frustrated only when their salaries or other payments are not released on time. Yes, money is a strong motivating factor. Would you feel like working if your organization does not give you salary on time? Ask yourself. Salaries are released on time only when there is free cash flow. Implementing Quality management tools ensure high customer loyalty, thus better business, increased cash flow, satisfied employees, healthy workplace and so on. Quality management processes make the organization a better place to work.

Remove unnecessary processes which merely waste employee’s time and do not contribute much to the organization’s productivity. Quality management enables employees to deliver more work in less time.

Quality management helps organizations to reduce waste and inventory. It enables employees to work closely with suppliers and incorporate “Just in Time” Philosophy.

Quality management ensures close coordination between employees of an organization. It inculcates a strong feeling of team work in the employees.

Authorship/Referencing - About the Author(s)
The article is Written By “Prachi Juneja” and Reviewed By Management Study Guide Content Team.

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BusinessBlogs Hub

7 Decision-Making Principles Leading us to Profitability
Guiding Principles of a business are necessary (honesty, integrity, customer service, etc.), but there is another set of principles that help the Business Owner in particular – decision-making principles.

How we make decisions effects everything we do. Problem – we make decisions subjectively, even when we think we’re being objective. All the research shows this – even at the major company level – we even buy subjectively.

As a result, we react badly to shiny objects, short-term victories and defeats, and strategic planning. So the question becomes, do you guide your biz or does it rule you? Who’s really in charge?

Want to make more money and stop recovering from bad decisions? Get some simple decision-making principles on which you run your business.

Like rails that guide a train, your decision-making principles are a core strategy to having a business that knows where it is going and how it is going to get there.

Here’s my seven decision-making principles. What are yours?

The 7 Decision-Making Principles of TeamNimbusWest:

Business Maturity Date.
Know Where I’m going & when I want to be there.
Make more money in less time.
Why do what others can and will do? Yield Per Hour. Process Mapping, Distributive Management
Focus on my lifetime goals, not just on growing my business.
A BHAG will keep us going, but “grow the business” is a lifeless idea. So is retirement.
Get off the treadmill, own the business instead of the business owning me.
The purpose of our business is to create a lifestyle for ourselves and our family.
Work ON my business, not just IN it. Highest and best use of my time.
The key to growth – perfecting as we go by strategic planning, not just production.
Make decisions on where I want to be, not where I am.
Clarity of Purpose leads to Hope which leads to Risk. Take good risks to grow.
Bad plans carried out violently many times yield good results. Do something.
Stop planning. Implement now and perfect as you go. Speed of Execution rules.
What are the decision-making principles of your business?

You’ve got decision-making principles that are running the show. You might as well write them down and see if you agree with who/what is actually in charge. If not, change them and take control of your business future.

Learn objectivity in decision-making processes. Know where you’re going, delegate, make decisions based on your strategic plan, and not based on where you are right now. And stop thinking about it so long. It’s not how good the plan is, but how committed you are to the bad (incomplete) plan you have.

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Smallbusiness.chron.com

Small Business» Business Planning & Strategy» Business Planning Process»
The Basic Steps in the Management Planning Process
by Devra Gartenstein; Updated March 13, 2018
Related Articles
1
The Five Stages of the Strategic Management Process
2
The Importance of Planning in an Organization
3
Five Functions of Management & Leading
4
What Are the Steps in the Decision-Making Process of a Manager?
If you have a clear idea of where you are and where you want to go, business-wise, you can develop a realistic, achievable plan to get there. The management planning process helps your company through the steps of defining a desired outcome and developing a strategy to achieve it. Setting this planning process in motion helps you move forward with clarity, and saves you wasted time, energy and capital.

Assess Your Situation
To know where you want to go, you must first understand where you are. Gather data about your company's present situation, including sales figures and customer feedback. Identify the company's strengths and weaknesses, soliciting both the internal voices of your staff and the external voices of your clients.

Set Priorities
Determine the values and outcomes you want your company to achieve, and state them clearly. Craft a vision statement by articulating the central ideas and values that keep your business on track, such as stellar customer service or a commitment to protecting the environment. Work with your management team to clarify this vision, and make sure there is consensus around adopting it as a guiding principle for your company.

Set Goals
Use the vision you have crafted to create measurable goals. For example, if you value customer service, you may work toward the goal of responding to every piece of customer feedback; if you're committed to environmental values, you may set the goal of having a carbon-neutral workplace in three years. Be as clear and specific as possible when creating your goals, using numbers to measure progress and success, and charting timelines for achieving your objectives.

Create Accountability Systems
Develop systems for evaluating progress as you work toward achieving the goals you have set. Put different managers and staff members in charge of domains, such as tracking sales figures or carbon emissions. Create a chain of accountability showing who is ultimately responsible for different outcomes. Have backup plans so you can shift gears and dedicate additional resources if the process isn't going according to plan.

Evaluate and Review
Create formal protocols for assessing your progress. Bring as many voices as possible into this evaluation process, and encourage honesty and objectivity. Assess how well you are progressing toward your goals, but also be open to reassessing the goals themselves, as long as you do so in ways that are still consistent with your long-term vision. Technologies and circumstances may change, making your goals less achievable or relevant. But if you do revisit your goals, do so with your vision in mind so you can find other ways of expressing it in your work.

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I chose the articles dealing with quality management, and planning and decision making to illustrate how business want to operate according to the services they are providing. In manufacturing type of organizations, Managers like using the Six Sigma process, this is used to produce better quality of products, while cutting down on time. Though Six Sigma is an excellent process it must be ran by managers who understand the concept and how it is run as a whole, or the desired results might not be what the company was expecting. The planning and decision making articles were interesting because of the variation of how to plan. One article mentioned that bad plans carried out violently will yield good results, although I don't agree with that assumption, the author's idea was to not waste a lot of time planning, but to act on what you have and perfect the process along the way

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04 JUN 2018
Are There Conditions Under Which Directors Should Consider Hiring a CEO Fired Elsewhere for Inappropriate Behavior?

Executives fired fairly or unfairly over worker violence and harassment charges are about to seek new jobs. James Heskett asks the difficult but unavoidable question: Are there conditions under which boards should consider hiring them?

by James Heskett

My column posted last week, “Under What Conditions Would You Hire a CEO ‘Displaced’ by #MeToo?,” raised much debate but also angry responses regarding the appropriateness of certain terms and labels. These prompted my editor and I for the first time in 18 years and 217 monthly columns to pull the piece temporarily and review the criticism. The result is this revised post, which reflects what we heard.

The article elicited forcefully written letters of complaint to my editor, and several other rebukes posted on comments to the story. Specifically, objections were raised to the use of “#MeToo-related accusations” without explaining #MeToo and what it means—no small task in a short piece such as this. The overall thread was that the references trivialized what victims experienced. Also, there were objections to the use of “displaced” and “refugees” to describe the growing ranks of those senior executives who have lost their jobs for actual or alleged inappropriate workplace behavior. My attention was called to the sensitivity of these terms because of what is going on in Syria, Myanmar, and other places in the world. In the article itself, I described labels I had seen elsewhere (including “the accused” and even “bad men”) in my struggle to come up with better descriptors. They were constructive and useful criticisms.

It became apparent that these debates were likely to obscure any discussion of the issue at hand. I asked myself how I would handle this if it were a real (as opposed to the simulated experience we try to create here) MBA classroom at HBS in which students and the instructor alike teach and learn. The answer: Take time out to agree on labels and definitions.

So we decided to pull and revise the piece, asking (as I do now): How do you think we should refer to executives fired for inappropriate workplace behavior?

Now let’s revisit the original issue. The attempted re-entry into the work world by the wave of recently fired senior executives with CEO potential is likely to begin this summer, so the issue takes on added timeliness. And let’s clarify that we are not talking about executives who are known to have committed serious assaults or other potential criminal acts. No board that I am personally aware of would consider hiring those people.

The growing body of senior executives who’ve lost their jobs due to inappropriate workplace behavior contains men with a wide variety of attitudes and capabilities. Some lost their jobs for what they did; others lost their jobs for what they didn’t do. What’s to be done with senior executives such as these?

It’s the duty of boards reviewing their CVs to perform proper due diligence. They will also be dealing with previous employers who are engaged in what has come to be called “passing the trash,” providing recommendations for former executives that are truthful only as far as they go, leaving out critical information about why the candidate is on the market.

Will organizations be tempted to hire someone, perhaps a highly experienced, high-profile executive, who might not otherwise be available or interested in the job? On the other hand, if the person is to be hired, what are the costs in terms of damage to an organization’s reputation and culture, manifested by objections and complaints by current employees?

Will CEO candidates who lost their jobs for what they didn’t do be considered differently than those who are available because of what they did? What else, if anything, should be done to evaluate someone who has lost his job under such conditions? And what message, if any, should the board send to executives throughout the organization confronted with “opportunities” to hire what might be called “tainted talent”?

As a director, are there conditions under which you would hire a CEO candidate fired elsewhere for inappropriate workplace behavior? What do you think?

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Harvard Business School

01 JUN 2016
When Business Performance Falters, is Culture Change the Fix?

SUMMING UP: Culture change is not a cure-all for corporate management problems, but it is an important element to be considered, say James Heskett's readers. What do YOU think?

by James L. Heskett
Original Article
A recent article in Harvard Business Review, “Culture Is Not the Culprit,” by Jay Lorsch and Emily McTague noted that “When organizations get into big trouble, fixing the culture is usually the prescription.” The article seeks to refute that notion. Given my interest in organization culture, it prompted several executives and alumni to ask me if I had a comment on the subject. In typical business school fashion, I’m asking for yours.

The article cites four case examples--Ecolab, Delta, Ford, and Novartis--in which current or former CEOs describe how they successfully negotiated business challenges. In three cases, the challenges involved getting everyone on the same page after acquisitions or mergers. They describe the methods they used to counter growing bureaucracies, encourage customer-centricity, and in all but one case foster collaboration across business units.

This involved such things as reorganizing, delegating authority, increasing accountability, building trust among employees, and recognizing and rewarding desired behaviors. The authors conclude from this that “cultural change is what you get after you’ve put new processes or structures in place to tackle tough business challenges like reworking an outdated strategy or business model. The culture evolves as you do that important work.” They then suggest that “it makes intuitive sense to look at culture as an outcome—not a cause or a fix.” In an email to me, Lorsch expanded on this by saying, “You cannot change culture just by making speeches and waving a wand. You need concrete changes in rewards, job assignments, and other measurements.”

A contrasting perspective is that culture—shared views of “how we do things around here”--is an important enabler of changes in strategic direction or business models.

This view is that a culture in which people trust each other and their leadership is one in which change (of a strategy or business model) is easier to achieve. Its advocates cite the primacy of culture in business success. In fact, great places to work are a product of an organization’s mission and culture, and great places to work have been shown statistically to produce higher returns than the norm for an industry. Lou Gerstner, in reflecting on his stint as CEO of IBM, said, “Until I came to IBM, I probably would have told you that culture is just one among several important elements in any organization’s makeup and success—along with vision, strategy, marketing, financials, and the like … I came to see, in my time at IBM, that culture isn’t just one aspect of the game--it is the game.” He set about personally to change it first before later transforming IBM’s strategy.

Yet a third view is that the odds of success in achieving important change are enhanced by coordinated efforts to alter, as Michael Beer puts it, “the organization model” (including culture) and the “economic model” (actions producing economic change, including strategy) at roughly the same time. He argues that it has more promise than one that addresses these matters sequentially. The idea here is that if initial efforts are directed only at fixing the business model, such actions (merging organizations, downsizing, etc.) can so poison the well that subsequent culture change is much more difficult to achieve.

So there you have at least three kinds of responses to the question. Is this an important discussion to be having? When business performance falters, where does the “fix” begin? What do you think?

References:

Michael Beer, High Commitment, High Performance: How to Build a Resilient Organization for Sustained Advantage (San Francisco: Jossey-Bass, 2009), pp. 295-325.

Louis V. Gerstner, Jr., Who Says Elephants Can’t Dance?: Inside IBM’s Historic Turnaround (New York: HarperCollins, 2002), pp. 181-182.

Jay W. Lorsch and Emily McTague, Culture Is Not The Culprit: When Organizations Are In Crisis, It’s Usually Because The Business Is Broken, Harvard Business Review, April, 2016, pp. 96-105.

SUMMING UP
Much conversation in management classrooms and business meetings emphasizes the importance of prioritization--what we do first, then second--in effecting change. It’s a way of achieving what we often call focus. It reflects the way most people think, read, converse, and act. Many of us have trouble holding several important thoughts in mind at a time.

Will this kind of thinking suffice in a dynamic, competitive business world? That’s a question implied by many of the comments concerning the issue of appropriate starting points for dealing with an organization’s lagging performance.

There was little support for an approach that first addresses an organization’s culture, “how we do things around here.” But Rick Mayhall commented that “culture is an integral design element that must be designed at the beginning of any initiative … Leaving culture purely as an outcome is an oversight that indicates leadership has not done the necessary work of defining and agreeing on what their integrated performance outcome needs to look like.” Mark Clark added, “The ability to articulate (culture) … well and more important infuse it into an entire leadership team at the front of a change process is what separates great leaders from the pack.”

A larger group sided with the notion that culture is an outcome, not a starting place. As Dan Wallace put it, you have to create culture “in the context of real people doing real work.” Marlis Krichewsky argued “culture probably cannot change exclusively from within … to kindle enthusiasm you need to look beyond yourself and interact with the environment.” Thriveinchange said that, “Culture is an outcome! … there is value in articulating the desired ‘way we intend to operate,’ but even this is best done to explain … ‘why’ we are making process, design and/or strategic changes.”

Others refused to think in terms of one primary starting point. Connie Chen commented that “Changes must be holistic” and Oleg Pohotsky agreed, saying that, “ it is not an either/or but a … coordinated process.” Art Stewart added, “In my view, culture must now be treated as an integrated strategy and viewed as a core asset for contributing to marketplace value and corporate valuation as well as the sustainable viability of the enterprise.”

Judith MacCormick challenged us to think about how we approach management in general. As she put it, “culture cannot be seen nor managed as a linear problem… we need to address what motivates good behaviour and discourages bad behaviour—all within the context of what we define success will look like—shareholder return, licence to operate, etc… There is no linear solution.”

Those of us who agree with her have to then ask ourselves, how do we avoid linear thinking, teaching, and acting? What do you think?

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www.shrm.org

ORGANIZATIONAL & EMPLOYEE DEVELOPMENT
Managers Must Delegate Effectively to Develop Employees
Planning can minimize poor performance

By Sam Lloyd

​​

Managers have some tasks that they need to do, but their primary job is to make sure that others are doing what they have been assigned to accomplish the mission and goals of the organization. Effective managers know what responsibilities to delegate to allow themselves time to plan, to collaborate with others in the organization, and to monitor the performance of their employees, making sure to give them adequate feedback and development opportunities.

Often, managers think that they are delegating when they assign tasks to employees. Sometimes this is merely dumping on people. Real delegation is assigning responsibility for outcomes along with the authority to do what is needed to produce the desired results.

Why is this not done well in most organizations? A major factor is the failure of organizations to assure that the supervisors and managers know how to delegate effectively. Many managers have never received training in delegation.

Other reasons why managers do not delegate as much as they could include:

The belief that employees cannot do the job as well as the manager can.
The belief that it takes less time to do the work than it takes to delegate the responsibility.
Lack of trust in employees’ motivation and commitment to quality.
The need to make one’s self indispensable.
The enjoyment of doing the work one’s self.
Guilt associated with giving more work to an overworked staff.
Some reasons for not delegating are legitimate. For example, if an organization is understaffed or managers have no one reporting to them, obviously it is very difficult to delegate responsibilities. However, most such arguments do not stand up to rational analysis. Managers need to delegate because they are not supposed to do all of the work themselves. They need to interact with other managers about goals; plan for possible changes in economic conditions, competitive factors and the like; and communicate with other managers about how to improve operations and develop new strategies. In addition, managers need to devote time to their own development through training and by keeping up with technology and other innovations relevant to their industry and their organization.

Managers are responsible for developing their employees to ensure that they are well trained, to identify future leaders, and to prepare their own successor when they move up or move on to other organizations. Delegating responsibility is a powerful statement to employees about how much they are trusted and how competent and valued they are considered to be to the company.
Delegator’s Dozen: A Preparation Checklist

Keep a delegation attitude. Ask yourself frequently: "Who else could do this?" Question every task, particularly those you have done for years.
Define the desired outcome. Ask: "What is the result I want accomplished?" Learn to assign responsibility for achieving results rather than unloading tasks.
Select the person. Consider more than one criterion when choosing to whom to delegate something. Some things to consider: Who has experience and skills? (Be careful not to overload this person.) Who needs to learn how to handle this responsibility? Who has the time to accept this responsibility? Who would like to have this opportunity?
Get input from others. Ask for ideas about what to change, who to involve and how to define the results. Consult one’s own team, other managers who interact with the team, one’s boss and customers.
Assign the responsibility and define the time factors. What is the deadline? When will you want progress reports?
Provide training and guidance. Does the person need training before assuming this responsibility? What guidance will they need to succeed? Remember to allow them freedom for independent thinking.
Define the authority level. How much power will they need? What kinds of power? Who else needs to know that this person has the authority to act? Be sure to inform them to assure cooperation with the employee.
Agree about the control process. What kinds of controls are needed? How can one feel in control and still empower employees to act independently?
Monitor progress. Pay attention and maintain control of the situation. Managers are still responsible for the success or failure of this person and for achieving the desired results.
Provide feedback. Stay in touch, giving plenty of positive reinforcement and coaching when needed.
Identify the lessons learned. What did the employee learn? What did you learn? Often, the person with the new responsibility will figure out better ways to get things done and such improvements need to be identified, documented and shared.
Evaluate performance. Give the person helpful feedback. What did they do well? Where can they improve? How can the results be improved? How can the manager do a better job of helping them succeed?

Communicating Delegation

Once managers have prepared to delegate certain responsibilities, the next step is to communicate with the person or person chosen to handle the newly assigned responsibility. Following is a four-part communication process that can help ensure successful delegation.

Meet face to face without time pressure. This is very important communication, and face-to-face interaction is the approach most likely to convey the message that this discussion is important. Make arrangements so that you are not interrupted. Explain why the person was selected for the assignment and what results need to be achieved. Remember, you are assigning responsibility for producing outcomes—not just performing tasks. Encourage the other to ask questions. This needs to be a dialogue, not a monologue. Be sure to agree about timing and the control process by the end of the discussion.

Confirm employees’ understanding and commitment. This is a common failure in delegation discussions. It is very important for managers to confirm that those to whom they’ve delegated responsibility have understood what they need to know; ask them to restate what has been said. Asking, “Do you understand?” almost always elicits the answers “Yes” or “I think so” even if the employee is totally confused. Do not, however, come across as testing them. Instead, say, “I want to be sure that I have communicated what I have intended to communicate. Will you please tell me what you have heard so far?” This communicates that you want to make sure that you have communicated without suggesting anything negative about the other’s listening abilities.

Define employee’s authority level. What kind of power will the person need to accomplish the results? Inform whoever else needs to know that you have delegated this responsibility to ensure their cooperation with the employee.

Follow up and provide coaching and guidance if needed. Don’t abandon the person. You are delegating, not abdicating. Be available for questions and to help resolve resistance from others. But remember not to look over the shoulders of those to whom you have delegated responsibility. Instead, provide feedback to reinforce what has been done well and to help them learn when they make mistakes or encounter problems that require learning. Mark the calendar for checkpoint dates and updates on progress.

Sam R. Lloyd is president of the training firm SuccessSystems, Inc. and author of the book Accountability: Managing for Maximum Results (Course Technology (Thomson, 2002).

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Managing Americans.com
Posted in Management on April 7, 2013

5 Keys to Effective Delegation: How Leaders Assign Responsibility & Authority
By Jayne Jenkins, CEO, Churchill Leadership Group

As business leaders we experience constant pressure from all sides, but our time and energy to get things done and deliver results is limited. What do we do? Delegate effectively.

Years ago as a new manager in the corporate world I suddenly found myself with twelve people reporting to me, a lot more travel and a hefty sales goal to deliver. I felt overwhelmed, sometimes incapable. Not only was I still learning how to do the job and learn about my new team, I also had to keep on top of all the activities that were expected of me. I had to deliver for my boss, be there for my team and keep up with my peers. With a type-A personality who sees opportunity everywhere, I felt like I could never keep up. I soon learned through coaching and mentoring, that is was not only critical for me to know where I was at my strongest, but to be very effective at prioritizing and delegating. No one had ever taught me how to delegate at this point, but like most I quickly realize it was very necessary.  I also learned the importance of being able to slow down and step back to think more strategically so that I could prioritize and delegate.

Today we’ll look at why you must learn to delegate and how to do so effectively. There is a little more to it than you might think.

Why delegate?  As super human as we often think we are, we are actually not! So the question becomes "Why not delegate?"  So often I see leaders overwhelmed and "in the weeds" doing activities that drain them and not acting as a leader, more of a micro manager. There are multiple negative consequences to this:

- They don't have time to lead their team or think strategically about their business.

- They suffocate employees, not allowing them to feel empowered or grow.

- If employees are not growing, succession planning is poor.

- Everyone is at risk of becoming disengaged and exhausted.

So why do leaders do this? Well there seem to be many reasons. Some have just never been taught any different; others feel only they can do certain activities well and need activities done their way. Most commonly these leaders don't trust others can meet their expectations. So to help you here are five key drivers of effective delegation.

5 Keys to Effective Delegation: How Leaders Assign Responsibility & Authority

1. It is OK to be human. Admit that working non-stop is unsustainable.
We cannot consistently work 12-hour days and be healthy and happy. Look around at those who try and see the negative health and family consequences that it causes. Would you like to work for an exhausted, stressed leader? For everyone's benefit admit the reality, you cannot do it all yourself!

Even recently I found myself thinking, "It is easier for me to do that rather than take on another virtual assistant and teach them how to do it." I like most of us worry that nobody else can do it as well as I can. Luckily now I catch myself and get right down to a delegation plan, fast! I realized the activities I had in mind did not play to my Strengths so I had to find someone who could do it more effectively and faster than I, therefore freeing me up to invest my energy where I am at my strongest.

2. Understand your Strengths.
Like you I can do many things well, but about twelve years ago I had an epiphany. With the help of Marcus Buckingham (Management/Strengths expert and international best selling author) among others, I realized that we all have a unique calling and there are areas where I stand out and add significant value over others - My Strengths.

So now I spend more of my time doing activities that drive my goals and play to my Strengths and create a well-rounded team with people who are strong in other areas. I delegate activities according to those people’s Strengths. Over time I have delegated more and more as it becomes clearer to me when and what to delegate, it is a journey, not a flip of a switch.

Don't know your Strengths or those of your team? Well I encourage you to make it a priority to figure this out and here are a few questions to help you start:

Where do you add the most value? To your team? To customers? To your goals?

Where do you feel the strongest?

What activities drain you?

3. Find qualified and accountable people to assist you.
This takes time but is well worth the work up front. Find people you can trust to help share your load.  You may consider hiring someone new as a business partner or as a corporate leader who can manage the day-to-day business with the ability to get to know the unique individuals on your team better than you can.

Give these individuals space to gain knowledge, experience and learn new skills in their Strength areas. You can help them develop their Strengths, but you have to start with a foundation of understanding them. When you have this, it’s so much easier to delegate because you can trust where they are most capable. Give them space and focus on the result. Encourage them, show trust and effectively recognize positive behaviors and progress. Success will build.

4. Assign your team members responsibility AND authority. Empower them!
How much responsibility and authority you give depends on the situation and person. So it's critical you and the person you are delegating to are on the same page as to the level of responsibility an authority they have (follow up in writing). Here are five levels you can use:

#1: Do exactly what I’ve asked you to do. Don’t deviate from my instructions. Be clear on the "why" behind why you are asking them to do it this way.

#2: Research the topic & come back to me. Then I can review & make a decision.

#3: Research the topic, outline the options, & please make a recommendation to me.

#4: Please do the research, make a decision, and then tell me what you did. Please just keep me in the loop so I have no surprises.

#5: Make whatever decision you think is best. There is no need to report back. I trust you completely & you have my full support.

As you can see from one to five there is increasing responsibility and trust. Start with one, assess and move towards five as things go well. This allows you to free yourself up and allows your team member to gain autonomy and to grow. Be sure to effectively recognize the behavior you want to see and you will see more of it.

5. Implement a Stop, Start, and Continue strategy.
With clients I often see activities being done and no one is sure why they are doing them! Determine what activities fall into each of these three buckets in terms of your strategic goals and then take action accordingly.

So let's summarize-
Delegation is a "must have" for sustainable success and your sanity! Commit to delegating. Keep the important activities that play to your Strengths and delegate other performance driving activities to the Strengths of others with clear responsibility and authority. Done well, everyone wins; people grow and productivity increases. When you delegate to peoples Strengths your organization grows faster because we grow the fastest in areas we feel strong.  Recognize often the behaviors you need to see and before you know it everyone is winning.

Written by Jayne Jenkins, CEO Churchill Leadership Group        Jayne, a STAND OUT Master Strengths Coach and Workshop Facilitator, is a leadership business veteran working with some of the largest companies in the world including Exxon, AstraZeneca and Sanofi-Aventis.  She has over 23 years of experience leading successful sales teams and holding positions in Marketing, Strategic Operations and Organization Development.  As CEO of Churchill Leadership Group, Jane consults and coaches teams to maximize the impact of Managers and Teams through a focus on STRENGTHS for sustainable results.

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I wanted articles to touch on the subject of culture change and delegating authority in the workplace. The articles dealing with culture change asks the questions what does an organization need to do when the business is failing. Do these companies need a culture change, or do they maintain the status quo? The other articles asks the question do firms consider hiring CEO's from companies after they have been fired. Noting that there could have been circumstances with which the CEO's were "hung out to dry" and other instances where the firing was warranted. The articles focusing on delegation of authority focuses on how to empower the employee to be a successful leader in the absence of the manager. Mainly pointing out that the manager must trust the employee to maintain or exceed the standard, and not to worry about having to back-brief every decision made.

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Bizfluent.com

Role of Communication in Human Resource Management
by Victoria Thompson; Updated September 26, 2017
Human resouces should use positive communication to boost morale.
It is the human resources department's responsibility to hire effective employees and prepare those employees to perform assigned tasks correctly. Communication plays a key role in the relationship.

Benefits
Communication is used in human resources to relay information from directors to employees. This information pertains to company policies or goals. Effective communication increases productivity, which benefits employees and the company. Proper communication techniques can boost employee morale to create a positive work atmosphere.

Considerations
Keep all communication professional between human resources and employees. Employees should never be made to feel uncomfortable, but supported and respected. Human resources should not micromanage employees but communicate information and respect the professionalism of the employee to execute the task.

Effects
Positive communication practices creates a work environment that reduces employee turnover. It is important to keep experienced employees within the company to help train and instruct others.

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work.chron.com

What Are the Benefits of Effective Communication as a Human Resource Manager?
by Ruth Mayhew
Many HR leaders communicate with executives about the organization's future workforce.
Related Articles
1
What Are the Qualifications of Being a Human Resources Manager?
2
Characteristics of a Human Resource Manager
3
Why Is Effective Communication Important in Management?
4
Effective Communication Between Management & Employees
If silo management was the preferred method for running organizations, then communication wouldn't be such a big deal. But the reality is that effective communication is key to any organization's success -- whether it's a small operation or a multinational corporation. Effective communication is a critical point for human resources leaders. They must be in sync with the organization's leadership and its workforce to support internal and external customer service, manage change within the organization and build the integrity of the HR department.

Intradepartmental HR Communication
While HR managers themselves must learn to effectively communicate with the organization's workforce, they also are obligated to strengthen the communication lines between HR leadership and HR staffers. One of the uphill battles for HR managers is improving employee perception of HR, which for the most part has been likened to reporting to the principal's office for a reprimand. Many employees don't understand the functionality of HR and, even less, the purpose that an HR department serves, except when it comes to processing payroll via direct deposit. When an HR manager communicates effectively with her staff, they represent a team with a consistent mission that can establish HR's credibility throughout the organization.

Strategic Direction
HR leaders, especially the high-level ones, regularly interact with top management. In organizations that value HR and look to HR department leadership as the guiding force in creating a productive and engaged workforce, HR managers form partnerships with top leaders to develop the company's strategic direction. They communicate the return on investment in HR activities and justify the organization's support for functions such as training and development. Absent the ability to communicate with chief executives, HR risks not becoming a member of the team responsible for defining the organization's strategic growth and functional implementation of its strategic plan.

Functional Implementation
An HR manager's expertise often is demonstrated through communicating her job knowledge, HR best practices and her professional vision for the HR department and the organization as a whole. Putting strategy into place requires functional implementation of steps, processes and procedures -- mostly communicating to the HR staff how to serve the needs of the organization's internal and external customers. Internal customers are the organization's employees and external customers are applicants, candidates, vendors and experts to whom the company might outsource HR functions. The benefit of effective communication means that the functional implementation is appropriate for the strategic direction of the company and that the HR staff clearly understands how to move forward under the direction of the HR manager.

Effective Leadership
Effective leadership benefits from effective communication on the HR manager's part in interdepartmental concerns. HR managers who are capable of empowering supervisors and managers in areas such as being first responders for employee relations matters, relieve HR staff of handling many of the routine issues that arise within departments. HR develops and delivers leadership training, too. This provides supervisors and managers with the tools to be successful, whether it's conducting annual performance appraisals, learning to coach employees for high performance or assessing the strengths of emerging leaders for the organization's succession plan.

Communication Benefits Risk Management
Organizations with disgruntled, unhappy employees subject themselves to costly workplace issues, complaints and lawsuits, but communication often resolves issues before they lead to litigation and settlements. Another benefit of effective communication through HR leadership minimizes the company's liability for unfair employment practices. Communicating the organization's policies on equal employment opportunities and substantiating employment decisions with proper documentation is one aspect of effective communication that ensures the organization is in compliance with federal, state and local labor and employment laws. Communicating these policies to both staff and leadership further ensures that the workforce understands the company's commitment to fair and equal treatment, regardless of sex, disability, race, religion and other non-job-related factors.

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smallbusiness.chron.com
Six main functions of a Human Resource Department
by Ruth Mayhew; Updated February 20, 2018
HR staff may be involved in creating the firm's organizational chart.
Related Articles
1
What Are the Functions of Human Resource Managers?
2
The Role of Human Resource Management in Organizations
3
Primary Responsibilities of a Human Resource Manager
4
Key Functions of an HR Department
An efficiently run human resources department can provide your organization with structure and the ability to meet business needs through managing your company's most valuable resources -- its employees. There are several HR disciplines, or areas, but HR practitioners in each discipline may perform more than one of the more than six essential functions. In small businesses without a dedicated HR department, it's possible to achieve the same level of efficiency and workforce management through outsourcing HR functions or joining a professional employer organization.

New Recruitment
The success of recruiters and employment specialists generally is measured by the number of positions they fill and the time it takes to fill those positions. Recruiters who work in-house -- as opposed to companies that provide recruiting and staffing services -- play a key role in developing the employer's workforce. They advertise job postings, source candidates, screen applicants, conduct preliminary interviews and coordinate hiring efforts with managers responsible for making the final selection of candidates.

Job Safety
Workplace safety is an important factor. Under the Occupational Safety and Health Act of 1970, employers have an obligation to provide a safe working environment for employees. One of the main functions of HR is to support workplace safety training and maintain federally mandated logs for workplace injury and fatality reporting. In addition, HR safety and risk specialists often work closely with HR benefits specialists to manage the company's workers compensation issues.

Employee Relations
In a unionized work environment, the employee and labor relations functions of HR may be combined and handled by one specialist or be entirely separate functions managed by two HR specialists with specific expertise in each area. Employee relations is the HR discipline concerned with strengthening the employer-employee relationship through measuring job satisfaction, employee engagement and resolving workplace conflict. Labor relations functions may include developing management response to union organizing campaigns, negotiating collective bargaining agreements and rendering interpretations of labor union contract issues.

Compensation and Benefits
Like employee and labor relations, the compensation and benefits functions of HR often can be handled by one HR specialist with dual expertise. On the compensation side, the HR functions include setting compensation structures and evaluating competitive pay practices. A comp and benefits specialist also may negotiate group health coverage rates with insurers and coordinate activities with the retirement savings fund administrator. Payroll can be a component of the compensation and benefits section of HR; however, in many cases, employers outsource such administrative functions as payroll.

Labor Law Compliance
Compliance with labor and employment laws is a critical HR function. Noncompliance can result in workplace complaints based on unfair employment practices, unsafe working conditions and general dissatisfaction with working conditions that can affect productivity and ultimately, profitability. HR staff must be aware of federal and state employment laws such as Title VII of the Civil Rights Act, the Fair Labor Standards Act, the National Labor Relations Act and many other rules and regulations.

Training and Development
Employers must provide employees with the tools necessary for their success which, in many cases, means giving new employees extensive orientation training to help them transition into a new organizational culture. Many HR departments also provide leadership training and professional development. Leadership training may be required of newly hired and promoted supervisors and managers on topics such as performance management and how to handle employee relations matters at the department level. Professional development opportunities are for employees looking for promotional opportunities or employees who want to achieve personal goals such as finishing a college degree. Programs such as tuition assistance and tuition reimbursement programs often are within the purview of the HR training and development area.

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www.thebalancecareers.com
The 3 New Roles of the Human Resources Professional

BY SUSAN M. HEATHFIELD  Updated May 18, 2018
Some industry commentators call the Human Resources function the last bastion of bureaucracy. Traditionally, the role of the Human Resource professional in many organizations has been to serve as the systematizing, policing arm of executive management.

Their role was more closely aligned with personnel and administration functions that were viewed by the organization as paperwork. This is because the initial HR functions needed, in many companies, came out of the administration or finance department areas.

Because hiring employees, paying employees, and dealing with benefits were the organization's first HR needs, bringing in finance or administration staff as HR staff is not surprising.

Administrative Functions and Executive Agendas
In this role, the HR professional served executive agendas well but was frequently viewed as a roadblock by much of the rest of the organization. Some need for this role remains—you wouldn’t want every manager putting his own spin on a sexual harassment policy, for example.

Nor can every manager interpret and implement the employee handbook as she chooses. Payroll and benefits need administration, even if they are now electronically handled. The administrative functions of the HR department continue to need management and implementation. These tasks are not going away anytime soon.

In this role, employees regarded HR as the enemy and going to HR was the kiss of death for your ongoing relationship with your own manager. Employees believed and were often correct, that the HR function was in place solely to serve the needs of management. Thus, employee complaints often fell on deaf ears in an HR department that existed to serve managers' needs.

Stories shared by readers are hard on HR professionals. They criticize everything from their education to their professionalism to their support for employees. More importantly, they accuse HR professionals of misleading employees, failing to keep employee information confidential, and exhibiting poor practices in areas such as investigations, benefits options, and hiring employees.

In some cases, HR is held in such disrespect that you may want to understand why your employees hate HR. Part of it is, of course, that employees don't always understand what the HR department does.

HR Needs to Transform
If the HR function in your organization is not transforming itself to align with forward-thinking practices, executive leadership must ask HR leaders some tough questions. Today’s organizations cannot afford to have an HR department that fails to contribute to lead modern thinking and contribute to enhancing company profitability.

In this environment, much of the HR role is transforming. The role of the HR manager, director, or executive must parallel the needs of his or her changing organization. Successful organizations are becoming more adaptive, resilient, quick to change direction and customer-centered.

Three New HR Roles
Within this environment, the HR professional, who is considered necessary by managers and executives, is a strategic partner, an employee sponsor or advocate and a change mentor.

These roles were recommended and discussed in Human Resource Champions, by Dr. Dave Ulrich, one of the best thinkers and writers in the HR field today, and a professor at the University of Michigan.

The HR professionals who understand these roles are leading their organizations in areas such as organization development, strategic utilization of employees to serve business goals, and talent management and development.

Let’s take a look at each of these roles and their impact on HR functions and practices.

Strategic Partner
In today’s organizations, to guarantee their viability and ability to contribute, HR managers need to think of themselves as strategic partners. In this role, the HR person contributes to the development of and the accomplishment of the organization-wide business plan and objectives.

The HR business objectives are established to support the attainment of the overall strategic business plan and objectives. The tactical HR representative is deeply knowledgeable about the design of work systems in which people succeed and contribute.

This strategic partnership impacts HR services such as the design of work positions; hiring; reward, recognition and strategic pay; performance development and appraisal systems; career and succession planning; and employee development. When HR professionals are aligned with the business, the personnel management component of the organization is thought about as a strategic contributor to business success.

To become successful business partners, the HR staff members have to think like business people, know finance and accounting and be accountable and responsible for cost reductions and the measurement of all HR programs and processes. It's not enough to ask for a seat at the executive table; HR people will have to prove that they have the business savvy necessary to sit there.

Employee Advocate
As an employee sponsor or advocate, the HR manager plays an integral role in organizational success via his knowledge about and advocacy of people. This advocacy includes expertise in how to create a work environment in which people will choose to be motivated, contributing, and happy.

Fostering effective methods of goal setting, communication and empowerment through responsibility builds employee ownership of the organization. The HR professional helps establish the organizational culture and climate in which people have the competency, concern, and commitment to serve customers well.

In this role, the HR manager provides overall talent management strategies, employee development opportunities, employee assistance programs, gain sharing and profit-sharing strategies, organization development interventions, due process approaches employee complaints and problem-solving, and regularly scheduled communication opportunities.

Change Champion
The constant evaluation of the effectiveness of the organization results in the need for the HR professional to frequently champion change. Both knowledge about and the ability to execute successful change strategies make the HR professional exceptionally valued. Knowing how to link change to the strategic needs of the organization will minimize employee dissatisfaction and resistance to change.

Organization development, the overarching discipline for change management strategies, gives the HR professional additional challenges. Consciously helping to create the right organizational culture, monitoring employee satisfaction, and measuring the results of organization initiatives fall here as well as in the role of employee advocacy.

The HR professional contributes to the organization by constantly assessing the effectiveness of the HR function. She also sponsors change in other departments and in work practices.

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In the articles I've found for the duties of the human resource department, I wanted to find information about the overall mission of an HRM team. And what I have found is that as time changes so must an organizations HR . Starting with sexual harassment in the workplace, this is a hot topic in our society so to many business they had to invest more resources into educating employees about the do's and dont's when it comes to sexual harassment in the workplace. It is the Hr's job to provide the training, and be the one who hears complaints, and take formal statements, and lastley be an advisory to higher management if further action needs to be taken

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www.forbes.com

JAN 20, 2018
Why Leaders Need To Embrace Employee Motivation

Christine Comaford , CONTRIBUTOR

How do we consistently get team members who say ‘I love my job, I trust my leader and l’m ready to rock today!’?
A more enriched, interactive tribal environment is good for the brain and good for the business.
How do we consistently get team members who say ‘I love my job, I trust my leader and l’m ready to rock today!’?

Shutterstock

According to Gallup, the purpose of performance management is to improve quality of work, productivity and other business outcomes, but traditional approaches have consistently fallen short. Let’s look at Gallup’s findings:

Only 2 in 10 employees strongly agree that their performance is managed in a way that motivates them to do outstanding work.
30% of employees strongly agree that their manager involves them in goal setting.
Employees whose managers involve them in goal setting are 3.6x more likely than other employees to be engaged.
21% of employees strongly agree they have performance metrics that are within their control.
14% of employees strongly agree that the performance reviews they receive inspire them to improve.
26% of employees strongly agree that the feedback they receive helps them to do their work better.

The result? Gallup estimates the cost of poor management and lost productivity from employees in the U.S. who are not engaged or actively disengaged to be between $960 billion and $1.2 trillion per year. Wow! What steps do leaders need to take to motivate their employees?

What Employees Really Want

The workplace is evolving and shifting. As leaders, we need to realize that the wants and needs of our employees are changing. We saw this when we learned how to create a culture where Millennials and members of Generation Z can thrive.

SmartTribes Institute
Millennials vs. Generation Z, research credit: https://www.shrm.org/ResourcesAndTools/hr-topics/behavioral-competencies/global-and-cultural-effectiveness/Pages/Move-over-Millennials-Generation-Z-Is-Here.aspx

The key to inspiring maximum performance from your team is not scoring them and offering standardized feedback based on their score. Instead, use a process that creates intrinsic motivation and benefits both the team member and the company.

Performance Motivation Is Key

Empowerment and motivation happen when people solve their own problems, and create their own aspirations and expectations. That’s why the outcome frame tool is a powerful first step. It helps our team find out what they really want and how they know when they’ve got it. It generates clarity and insights. Helping our people focus on the outcome they want to create, not the problems in the way, activates their reward (pleasure) network. Once our team knows what they really want, it’s time to create an action plan to motivate team performance.

Impact Descriptions – Not Job Descriptions
Clear Needle Movers
Individual Development Plans (IDPs)
Performance Self-Evaluations

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What Is Management Leadership's Role in Motivating Employees?
by Kristine Tucker

Ways a Manager Can Motivate an Employee Using the Classical Theory
As a manager in a company, you must find ways to motivate your employees in order to encourage productivity and ensure job satisfaction. A manager cannot force an employee to be successful at his job, but he can motivate him with fair treatment, proper incentives and adequate compensation. It is the role of management to lead by example and motivate employees to do their best.

Combine Work Goals with Employee Goals
As a manager, you can motivate your employees by making sure your work goals align with their work goals. This requires strategic planning and communication because you must let your employees know exactly what you expect from them. If they do not have standards and goals to meet, you will feel frustrated by their lack of efficiency and they will feel frustrated by their failed efforts to please you. Misunderstanding of goals leads to disappointment and failure--the opposite of the motivating forces you are striving to create.

Understand What Motivates Each Employee
Managers must understand exactly what motivates each employee in their company. Some are motivated by money and benefits; some are motivated by praise; and others are motivated by work-life balance. As a manager, you must assess each employee's work responsibilities and underlying motivations. An employee analysis requires you to meet with each employee individually to discuss their work-related desires. Most employees appreciate a manager's sincere interest in their lives.

Lead by Example
One of the best things you can do as a manager to motivate your employees is to lead by example. If you are lazy, prone to procrastination or allow your temper to flare, you will likely get the same behavior from your employees. If you want to motivate your employees to pursue excellence in their job responsibilities, behave how you would like them to behave. Speak kindly, show respect and give praise where it is due.

Create a Fair System
Fairness is an important motivating factor in the workplace. You must create a fair system of incentives, rewards and benefits that encourages your employees to work hard. As an employer, you can never show favoritism. Incorporate fair compensation programs, employee performance evaluations and consistent policies into your workplace. You must establish an equitable and consistent work environment.

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www.thebalancecareers.com

How Great Managers Motivate Their Employees

BY SUSAN M. HEATHFIELD  Updated March 13, 2018
What can managers do to motivate employees? The reality, when you talk about how to motivate employees, is that employees are motivated. The manager's challenge is to figure out how to tap into that motivation to accomplish work goals. Fortunately, the manager controls the key environmental factors necessary to motivate employees.

The most significant factor, that the manager controls, is his or her relationship with each employee. The second most important factor in a manager's ability to motivate employees is creating a work environment and organizational culture that fosters employee motivation and engagement.

This work culture consists of an environment in which employees are trusted, treated like the adults they are, and not micromanaged. Employees are entrusted with the values, vision, mission, and strategic framework within which they are expected to accomplish their jobs.

They receive frequent communication, are treated with respect and civility, and have input to every facet of the work they are hired to produce. They are encouraged to speak up about what they believe when participating in solving a problem for their customer.They are further trusted by the organization with the most significant and critical financial information so they are not blindsided by business problems.

These are factors that help produce a work environment in which employees will choose motivation to accomplish the requirements of their work. Nothing is more powerful than a group of contributing, motivated employees. Trust this.

Here are additional thoughts on how managers can motivate employees.

01  7 Ways Managers Can Motivate Employees—Today

No matter what kind of work environment and culture your organization provides to support your ability to motivate employees, you can directly affect employee motivation. You can create an environment that will motivate employees.

You can take actions every day that will increase employee satisfaction. These are seven key actions you can take to motivate employees—today.

02  Management Matters Most in Motivation

Motivation is the most powerful emotion that employees bring to work each day. The manager's commitment to motivating employees through shared vision and communication is the fundamental skill that great managers bring to the workplace.

Employees in management roles can learn to inspire and motivate employees. Here is why the skill and wisdom of managers matters most in employee motivation.

03  You Can Make Their Day: 10 Tips for the Leader about Motivation
Man and woman dressed in formal business attire collaborate

As their manager, you can make their day or break their day. Your choice. No kidding. The manager is the most powerful factor in motivating employees.

As a manager or supervisor, your impact on employee motivation, by how you motivate employees, is immeasurable. Learn more about how you can make your employees' day.

04  It's All About the Managers...Duh!
Beautiful woman feels motivation on the job.
•••
The keys to financial success and a profitable business are not the strategies of management or the systems of the firm. The character and skill of individual managers, who practice what they preach and recognize the manager's role in coaching and to motivate employees are what count.

The manager can still operate a profitable business when his or her employees are motivated to contribute - likely even more so. Learn more about how the manager can motivate employees while operating a profitable business.

05  Leadership Inspires Motivation

Want to spend your time in leadership activities that inspire employee motivation, trust, and certainty while dispelling employee fear, negativity, and skepticism? During times of change, no actions are more powerful than when managers make the time to communicate and build relationships with their employees.

When managers share the vision, optimism, and purpose-driven goals, how to motivate employees and gain their commitment becomes easy. Find out more about how to inspire and motivate your employees.  Your leadership relationship with them is your most significant tool.

06  The Bottom Line for Motivating Employees: 10 Tips
The bottom line when you're motivating employees is the manager and the environment he or she creates.
•••
Employee motivation is a description of an employee’s intrinsic enthusiasm about and drive to accomplish work. Every employee is motivated about something in his or her life. How a manager can tap into the intrinsic motivation that an employee brings to work is a combination of fulfilling the employee's needs and expectations from work.

The manager must affect the workplace factors that enable him or her to motivate employees - or not. Here are ten tips about employee motivation and creating a work environment that is motivating for employees.

07  You Need to Know What Motivation Is—Really
Motivated business people working together on a project.
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Want to encourage and inspire motivation? Then, you need to know what motivation is—really.

Motivation is your employee's intrinsic enthusiasm about their work and their drive to accomplish activities that are related to their work. Motivation is that internal drive that causes an individual to decide to take action on a task, a problem, or a challenge. You need to recognize employees as the most significant resource you have.

In fact, People are your only resource. If you get this, you will create a work environment to engage, motivate, and retain employees.

08  How to Demonstrate Respect at Work
Three collaborating female employees
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Employees want respect from their manager. In fact, treating employees with dignity and respect tops the list of factors that enable managers to motivate employees.

The relationship between an employee and his or her manager is a key factor in employee motivation, engagement, and retention. You can motivate employees by treating them with respect. Here's how to demonstrate respect while you motivate employees in your workplace.

09  Top 10 Ways to Show Appreciation

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If you tell your reporting employees that you value them and their contribution, you are on the right path to motivate employees. Employees appreciate your positive recognition in any form. In fact, make sure that the majority of your interactions with employees are positive and appreciative.

Then, when you need to suggest improvement or correct performance or behavior, you do so in an environment of openness and acceptance. The employee is more likely to change, and you achieve your goal to motivate employees.

10  Provide Motivational Employee Recognition

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You can avoid the employee recognition traps that: single out one or a few employees who are mysteriously selected for the recognition; sap the morale of the many who failed to win, place, or even show; confuse people who meet the criteria yet were not selected; or sought votes or other personalized, subjective criteria to determine winners.

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trainingindustry.com

Managing Employees through Motivation
January 1, 2016
Motivation is fundamental to employee engagement and performance. It is what drives us to set and attain goals. The goal of employee engagement is to enhance employees to exercise discretionary effort and the best way to achieve it is through motivating them. When employees are motivated, they engage each other through teams to improve the performance of the organization. Motivation is categorized into two ways, intrinsic and extrinsic motivation. Intrinsic motivation is derived from internal desires. It includes things such as happiness, recognition, and responsibilities. On the contrary, extrinsic motivation is the desire to gain external rewards or avoid punishment. It includes cash prizes, promotion, and bonuses among others.

The following ways are how managers can motivate their employees.

Awards and recognition

Most organizations are accustomed to the employee of the month award where one person is rewarded while the contribution of others is ignored. Instead of this kind of a reward system, a creative multiple award system is better to recognize the efforts of various employees. These employee recognition awards should be displayed for all employees in the organization to see, understand and be able to work towards achieving the goals. Employees gain a company-wide recognition from these rewards which in turn endows them with a sense of achievement and the pride of physical rewards.

Competition

To motivate employees, managers need to devise a friendly competition among their employees to encourage task performance. Competition serves to motivate employees both extrinsically and intrinsically. When designing a competition, it is done in a way that motivates employees for a reward and recognition in the organization. Most organizations assign points for completion of certain tasks, behaviors at the end of the period or employee with the most points.

Negative reinforcement

Most organizations today are aware that negative reinforcement means doing something adverse to the employees and hence try to avoid it. Negative reinforcement is stopping something or taking something away. It motivates employees intrinsically since a person is compelled to perform a task to avoid or stop something from happening, or the action will lead to something removal of something. For instance, when an organization has the culture where employees are encouraged to complete a task with high quality and without mistakes to avoid depletion or re-work, then the employees will desire to provide high quality to avoid rework as the unfavorable consequence.

Lead by example

To have a productive team, a leader needs to be productive too. Employees observe their leaders and learn from them. Employees put as much effort as their bosses because the employees see your work as an example of how things should be done. For instance, if you are the manager who has the behavior of leaving early on Fridays, then it is likely that you will impact that behavior to your employees. The idea is for the leader to lead by example, be a role model for working hard and that way, you would impact to the employees’ motivation.

Communication is key

When the lines of communication are open, employees can share ideas, they feel more connected to their colleagues and leaders and most of all they are more motivated to contribute to the future. The leaders of the company should create an ‘open door policy’ both horizontal and vertical. Simply giving your employees freedom to communicate and being listened by leaders can be a milestone to boost their morale.

Praise good work and offer feedback

People are happy when they are appreciated or praised when they accomplish something. Employees need feedback and encouragement to make them feel positive about their work. The most important thing is honesty with the feedback. Find something that the employee has impressed you with and also find things he/she should improve and provide appropriate guidance on how to achieve the goal.

When managers manage employees with motivation, better work is produced.

When managers manage employees with motivation, better work is produced.

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Motivating the workforce is one of the hardest jobs a manager has to accomplish. In articles dealing with motivation, employees felt that their managers did not include them in work related decisions, 20% of the employees are not invested in the company, only there to collect a paycheck. So with that type of attitude existing throughout companies all over, managers are focusing on becoming more involved with their employees, rewarding successful work, and trying to have a more fair-minded atmosphere for the workforce to do their job in.

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smallbusiness.chron.com
How Organizational Control Is Important to organizational performance; Sam Ashe-Edmunds; Updated May 01, 2018

While you don’t want to micromanage your employees, you can’t leave them unsupervised if you want to maximize organizational efficiency and productivity. Creating effective management controls -- including strategic objectives, operational policies and employee guidelines -- will help you direct, rather than just limit, the activities of your employees.

Organizational Control
Organizational control includes developing rules, guidelines, procedures, limits or other protocols for directing the work and processes of employees and departments. These controls can include setting rules or procedures for financial transactions, employee behavior and specific practices for all or individual departments. A control can depend on an individual employee following the guideline, or require multiple parties to agree on an action.

Financial Stability
A common internal business control target is regulating financial procedures. This helps improve communications, allows managers to determine whether their efforts are meeting annual goals, and prevents fraud and errors. These controls include requiring each department head to submit and monitor an annual budget, setting limits on who can write checks, requiring large purchases to be pre-approved by management, holding regular audits and conducting regular budget variance analyses to spot potential problems before they get out of hand. Financial controls can also include the production of regular reports such as cash-flow and profit-and-loss statements, and labor, overhead and production expense reports.

Brand Management
To maximize sales to a target customer base, a business must send a consistent message about its products or services. This includes not only communicating the brand through marketing messages, but also by your price, where you sell your product, its features and packaging. Organizational controls often require all decisions regarding product, price, promotion and distribution to go to the marketing department first for approval. This helps prevent inconsistent brand messages, such as a promotions manager offering a two-for-one coupon at a high-end salon or restaurant.

Increased Productivity and Efficiency
One of the aims of organizational control is to help departments work better together. You can do this by instituting specific communications procedures, weekly interdepartmental meetings and regular management memos. To improve the performance of individual employees, your controls might include sharing a detailed organization chart so everyone knows who reports to whom. Controls can include requiring managers to create written job descriptions for every subordinate. Companies might hold mandatory orientation sessions for new employees, require certification for some employees and create an employee handbook that sets workplace policies such as attendance rules, grievance policies and safety regulations.

Legal Compliance
The threat of lawsuits or workplace rule violations is a serious concern for employers, and organizational policies and procedures that address employee behavior can decrease missteps. Workplaces free from harassment, discrimination, bullying and gossip foster better morale and team spirit, and reduce problems that can lead to decreased productivity, efficiency and overall performance. The same holds true when companies institute safety and security controls, and provide employee training.

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cliffnotes.com

Organizational Control Objectives:

Simply put, organizational control is the process of assigning, evaluating, and regulating resources on an ongoing basis to accomplish an organization's goals. To successfully control an organization, managers need to not only know what the performance standards are, but also figure out how to share that information with employees.
Control can be defined narrowly as the process a manager takes to assure that actual performance conforms to the organization's plan, or more broadly as anything that regulates the process or activity of an organization. The following content follows the general interpretation by defining managerial control as monitoring performance against a plan and then making adjustments either in the plan or in operations as necessary.

The six major purposes of controls are as follows:

Controls make plans effective. Managers need to measure progress, offer feedback, and direct their teams if they want to succeed.
Controls make sure that organizational activities are consistent. Policies and procedures help ensure that efforts are integrated.

Controls make organizations effective. Organizations need controls in place if they want to achieve and accomplish their objectives.

Controls make organizations efficient. Efficiency probably depends more on controls than any other management function.

Controls provide feedback on project status. Not only do they measure progress, but controls also provide feedback to participants as well. Feedback influences behavior and is an essential ingredient in the control process.

Controls aid in decision making. The ultimate purpose of controls is to help managers make better decisions. Controls make managers aware of problems and give them information that is necessary for decision making.
Many people assert that as the nature of organizations has changed, so must the nature of management controls. New forms of organizations, such as self‐organizing organizations, self‐managed teams, and network organizations, allow organizations to be more responsive and adaptable in today's rapidly changing world. These forms also cultivate empowerment among employees, much more so than the hierarchical organizations of the past.

Some people even claim that management shouldn't exercise any form of control whatsoever, and should only support employee efforts to be fully productive members of organizations and communities. Along those same lines, some experts even use the word “coordinating” in place of “controlling” to avoid sounding coercive. However, some forms of controls must exist for an organization to exist. For an organization to exist, it needs some goal or purpose, or it isn't an organization at all. Individual behaviors, group behaviors, and all organizational performance must be in line with the strategic focus of the organization.

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automationworld.com

Optimizing Operations via Business Automation
By Stephanie Neil , Senior Editor , on February 13, 2018

As market dynamics change and global competition intensifies, manufacturers are examining all corners of the organization to figure out how to cut costs and increase productivity without impacting the efficiency or safety of the factory. In an effort to help, many industrial control companies are extending automation capabilities by coupling software to address business processes, thus elevating overall operational efficiency.

This week at the ARC Forum in Orlando, Yokogawa Electric Corp., announced its contribution to business process optimization with the release of its Operations Management software designed to record and manage the data related to the work performed by plant personnel.

The offering is part of the company’s new business concept called Synaptic Business Automation, which is meant to create value for customers by connecting everything from data to systems to services to the supply chain, as well as people. The Synaptic name is based on the word “synapse,” a structure in the nervous system that plays a role in the transfer of signals to other parts of the body. Similarly, Synaptic Business Automation is designed as a way to digitize and standardize data based on accumulated knowledge, and then facilitate the exchange of information between groups on the plant floor.

The underlying technology comes from the domain knowledge of KBC Advanced Technologies, which Yokogawa acquired in 2016. KBC is a provider of software and consultancy to the global oil and gas industry. It is focused on achieving operational excellence and improving profitability for both the upstream (oil production) and downstream (oil refineries and integrated refining and petrochemical production complexes) segments. Leveraging KBC expertise and the Yokogawa portfolio of automation products, the Synaptic offering is focused on four key areas, including supply chain, asset operations, asset management and integrity, and operational risk management.

The Operations Management software, in particular, can help improve reliability and safety by ensuring the workforce has the information they need to carry out tasks correctly. It is meant to support safe and secure operations, but it can also record event actions and the work carried out based on work instructions, enabling the retrieval and use of information from skilled operators. In addition to oil and gas, the software can be used in other process industries including chemical, power, pulp and paper, food, pharmaceuticals and water/wastewater.

“Automating business processes is a unique capability in the market,” says Simon Rogers, Yokogawa’s vice president of advanced solutions during a press conference. “It delivers quick and sustained value to clients.”

That’s because human factors are often at fault for the emergency shutdowns and other issues that impact operational efficiency in plants. In many cases, work instructions are done through verbal exchanges or with written documents. This can make it impossible to check work progress in real time. In addition, errors can be made when adding information and it can be difficult to locate records of past operations—which leads to the growing need for operations management solutions to enhance efficiency, safety and knowledge retention.

Yokogawa’s Operations Management software digitizes work instructions, including incident management and change management, and includes an intuitive user interface enabling users to understand the status of an operation with just a glance.

Key Performance Indicators (KPIs)—which Yokogawa refers to as Synaptic Performance Indicators (SPIs), as they are based on KBC’s domain knowledge and experience working with Big Data— cover areas of improvement in management (production, energy costs, maintenance costs, margins and incidents), engineering (yield or quality, performance, energy consumption, availability) and operations (control performance, process performance, asset performance, alarms). When applied, these will transform a business into a profit-driven organization vs. an event-driven operation, Yokogawa officials said.

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Article October 2017
Performance management: Why keeping score is so important, and so hard
By Raffaele Carpi, John Douglas, and Frédéric Gascon

The elements of a good performance-management system are simple, but integrating them into a business’s fundamental operating system is more difficult than it seems.

Effective performance management is essential to businesses. Through both formal and informal processes, it helps them align their employees, resources, and systems to meet their strategic objectives. It works as a dashboard too, providing an early warning of potential problems and allowing managers to know when they must make adjustments to keep a business on track.

Organizations that get performance management right become formidable competitive machines. Much of GE’s successful transformation under former CEO Jack Welch, for instance, was attributed to his ability to get the company’s 250,000 or so employees “pulling in the same direction”—and pulling to the best of their individual abilities. As Henry Ford said, “Coming together is a beginning; keeping together is progress; working together is success.”

Yet in too many companies, the performance-management system is slow, wobbly, or downright broken. At best, these organizations aren’t operating as efficiently or effectively as they could. At worst, changes in technologies, markets, or competitive environments can leave them unable to respond.

Strong performance management rests on the simple principle that “what gets measured gets done.” In an ideal system, a business creates a cascade of metrics and targets, from its top-level strategic objectives down to the daily activities of its frontline employees. Managers continually monitor those metrics and regularly engage with their teams to discuss progress in meeting the targets. Good performance is rewarded; underperformance triggers action to address the problem.

Where do things go wrong?
In the real world, the details of performancemanagement systems are difficult to get right. Let’s look at a few common pitfalls.

Poor metrics
The metrics that a company chooses must actually promote the performance it wants. Usually, it can achieve this only by incorporating several of them into a balanced scorecard. Problems arise when that doesn’t happen. Some manufacturing plants, for example, still set overall production targets for each shift individually. Since each shift’s incentives are based only on its own performance, not on the performance of all shifts for the entire day, workers have every incentive to decide whether they can complete a full “unit” of work during their shift.

If they think they can, they start and complete a unit. But if they don’t, they may slow down or stop altogether toward the end of the shift because otherwise all of the credit for finishing their uncompleted work would go to the following shift. Each shift therefore starts with little or no work in process, which cuts both productivity and output. A better approach would combine targets for individual teams with the plant’s overall output, so workers benefit from doing what they can to support the next shift as well as their own.

Poor targets
Selecting the right targets is both science and art. If they are too easy, they won’t improve performance. If they are out of reach, staff won’t even try to hit them. The best targets are attainable, but with a healthy element of stretch required.

To set such targets, companies must often overcome cultural barriers. In some Asian organizations, for example, missing targets is considered deeply embarrassing, so managers tend to set them too low. In the United States, by contrast, setting a target lower than one achieved in a previous period is often deemed unacceptable, even if there are valid reasons for the change.

Lack of transparency
Employees have to believe their targets encourage meaningful achievement. Frequently, however, the link between individual effort and company objectives is obscure or gets diluted as metrics and targets cascade through the organization. Different levels of management, in an attempt to boost their own standing or ensure against underperformance elsewhere, may insert buffers into targets. Metrics at one level may have no logical link to those further up the cascade.

In the best performance-management systems, the entire organization operates from a single, verified version of the truth, and all employees understand both the organization’s overall performance and how they contributed to it. At the end of every shift at one company in the automotive sector, all employees pass the daily production board, where they can see their department’s results and the impact on the plant’s performance. The company has linked the top-line financial metrics that shareholders and the board of directors care about to the production metrics that matter on the ground. Frontline employees can see the “thread” that connects their daily performance with the performance of their plant or business unit

Exhibit 1
Leaders adapt and cascade performance indicators to all staff levels.
A senior leader at another manufacturer aligns the whole organization around a shared vision through quarterly town-hall meetings for more than 5,000 staff. Managers not only share the company’s financial performance and plant-specific results but also introduce new employees, celebrate work anniversaries, and recognize successful teams. Most important, if targets are missed, the senior leader acts as a role model by taking responsibility.

Lack of relevance
The right set of metrics for any part of a business depends on a host of factors, including the size and location of an organization, the scope of its activities, the growth characteristics of its sector, and whether it is a start-up or mature. To accommodate those differences, companies must think both top-down and bottom-up. One option is the hoshin-kanri (or policy-deployment) approach: all employees determine the metrics and targets for their own parts of the organization. Employees who set their own goals tend to have a greater sense of ownership for and commitment to achieving them than do those whose goals are simply imposed from above.

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Lack of dialogue
Performance management doesn’t work without frequent, honest, open, and effective communication. Metrics aren’t a passive measure of progress but an active part of an organization’s everyday management. Daily shift huddles, toolbox talks, after-action reviews, and the like all help to engage team members and to maintain a focus on doing what matters most. Applying the “plan–do–check–act” feedback loop, based on pioneering research from Charles Shewhart and W. Edwards Deming, helps teams learn from their mistakes and identify good ideas that can be applied elsewhere. And in many high-performing companies, supervisors act as coaches and mentors. One-on-one sessions for employees demonstrate concern and reinforce good habits at every stage of career development.

Lack of consequences
Performance must have consequences. While the majority of employees will never face the relentless “win or leave” pressure typical of professional sports, weak accountability tells people that just showing up is acceptable.

Rewarding good performance is probably even more important than penalizing bad performance. Most companies have various kinds of formal and informal recognition-and-reward systems, but few do enough of this kind of morale building, either in volume or frequency. In venues from lunchroom celebrations to town-hall announcements, employee-of-the-month and team-achievement awards are invaluable to encourage behavior that improves performance and keeps it high. One COO at an industrial-goods company keeps a standing agenda item in the monthly business review for recognizing the performance of individuals and teams. Employees on the list may find a gift waiting at home to thank them (and their families) for a job well done.

Lack of management engagement
The words of Toyota honorary chairman Fujio Cho—“Go and see, ask why, show respect”—are now famous as basic lean-production principles. Yet in many companies, senior managers rarely visit plants except during periodic business reviews, and they appear on the shop floor only when a major new capital improvement is to be inspected.

Management interactions with frontline personnel are an extremely powerful performance-management tool. They send a message that employees are respected as experts in their part of the business, give managers an opportunity to act as role models, and can be a quick way to solve problems and identify improvements.

One company’s machinery shop, for example, had developed such a reputation for sloppiness and missed deadlines that managers suggested outsourcing much of its work. When a senior manager was persuaded to visit the workshop, he was appalled at the dirty, cluttered, and poorly maintained environment. Employees reported chronic underfunding for replacement parts and tools, and asked the manager what it would take to save their jobs. He told them to “clean up the shop and give me a list of what needs to be fixed.” Both sides lived up to their commitments, and in less than a year the shop became a reference case for efficiency within the company.

Building a strong performance-management system
The best companies build performance-management systems that actively help them avoid these pitfalls. Such systems share a number of characteristics.

Metrics: Emphasizing leading indicators
Too often, companies measure and manage performance through lagging indicators, such as compliance with monthly output or quality targets. By the time the results are known, it is too late to influence the consequences. The best companies track the same metrics—but also integrate their performance-management systems into critical process inputs. Industrial Internet technologies, such as the SCADA1 architecture and distributed-control systems, let manufacturing staff know within minutes (or seconds) about variations in performance, even in remote parts of a plant. That lets people react long before the variation undercuts output or quality.

Some changes require almost no investment in technology. At the end of each workday, for example, production and functional teams can complete a checkout form assessing how it went. A combination of quantitative and qualitative metrics and simple graphics (such as traffic lights and smiley faces) provides an easy, highly effective tool for identifying and correcting issues or problems before the next day’s work begins.

As performance-management systems evolve, the metrics they use will become more complex, incorporating continuous rather than discrete variables: “everyone showed up on time today” will become “the team achieved 93 percent on the schedule-performance index using 90 percent of the labor-performance index.” The extra detail better informs decisions such as whether to add more labor to meet a delivery date or to push out a schedule for delivery.

Sustainability: Standard work and a regular heartbeat
Regardless of changes to metrics and targets, the best companies keep the cadence of meetings and reviews constant, so they become an intrinsic part of the rhythm of everyday operations (Exhibit 2).

Exhibit 2
A regular performance-review cadence allows issues to be identified and resolved in an appropriate time frame.
The emphasis on regular, standardized processes goes beyond explicit performance-management activities and extends deep into every aspect of a company’s operating models. Standard work, for example, is based on three simple rules. First, there should be a standard for all activities. Second, everyone must have the knowledge and ability to meet that standard. Finally, compliance with it must be monitored and measured.

In many functions, the business cycle forces a regular rhythm or cadence: the weekly payroll, the monthly accounting close, or the quarterly inventory review. Good companies take advantage of these requirements to define a few central metrics, such as cycle times and accuracy, thus driving continuous improvement across every function.

As part of a lean-manufacturing excellence program, one industrial-commodities company encourages employees to indicate “what went well today, what didn’t go well today, what management can do to help” on their productionarea boards every day. Supervisors collect the information on index cards and post them on a lean-idea board. Representatives of each function meet with the plant manager every morning and accept or reject the cards or return them for more information. Every accepted card gets an owner and timeline for completion. Company leaders estimate that the boards generate at least $2 million a year in cost savings or higher output—but the impact on employee morale and engagement is “priceless.”

Ahead of the curve
Ahead of the curve: The future of performance management
Read the article
A checklist or standard operating procedure that defines the steps and sequences for every key process usually enforces standard work. In employee onboarding, for example, one company noted that small details—assigning email addresses, telephone numbers, and software and hardware access—were especially important for retaining employees early in their tenures. A checklist is now at the front of each new hire’s personnel file, with a copy in the supervisor’s file. The performance reviews of supervisors now assess how well they handled the onboarding of new employees, and everyone who resigns completes a mandatory exit interview.

Continuous improvement: Standard work is for leaders too
Standard work is essential at all levels of an organization, including the C-suite and senior management in general. Standard work for leaders forces a routine that, while uncomfortable at first, develops expectations throughout an organization. It is those expectations, along with specific metrics, that ultimately drive predictable, sustainable performance.

One global resources company now requires managers to demonstrate that they spend 50 percent of their time on a combination of coaching their people and attending safety briefings, shift huddles, improvement reviews, and production meetings. To free up time, other meetings are scheduled only on one day a week— and conference rooms no longer have chairs.

Taking this approach even further, every autumn a field-services organization commits itself to a comprehensive, enterprise-wide calendar for the entire following year. The calendar sets dates for all conferences, monthly and quarterly management meetings, formal performance reviews, and succession-plan meetings, as well as training and development opportunities. All agendas are fixed, and all meetings are subject to strict time limits. There is little need for additional leeway because internal reporting follows tight guidelines for transparency and timeliness: financial results are published internally every month, while data on the performance of teams and units in meeting annual incentive-plan goals are updated and published monthly on bulletin boards.

Most industrial companies have access to rich data on the performance of their operations. The technological advances associated with increasing use of automation, advanced analytics, and connected devices mean that this resource constantly improves. But how can organizations best use their data? A crucial part of the answer is instant feedback loops, daily performance dialogues, and routine performance reviews. Maintaining the willingness and ability to hardwire these performance-management processes into the rhythm of daily work isn’t sexy—but over the long run, it’s the most effective route to real, sustainable performance improvements.

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How do companies increase production, and also provide a high level of quality? that is what the articles I have chosen attempts to answer. When looking at the articles you notice a common mishap most managers have when they haven't met their quota, and that is their was a breakdown in communication. Either the employee did not understand what was expected of him or her, or the information was not clear or the information was passed down in an untimely fashion. To create better workflow for companies managers are making work plans that are more detailed, and ensuring employees understand what is expected. Making sure the work scope fits the team, not putting to much on their plate at one time, and making sure that employees have the necessary tools to provide quality products or service within a reasonable time frame.