50 shades of teal management: practical cases - Razgulyaev Valera 2 стр.

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Chapter One. Why bother?

The majority of the definitions will be given in the following chapter, but at the beginning of the book, we still have to agree on what we understand as "management." We often use this word in everyday life, while hardly even thinking about how we might explain the concept clearly.

Task 1

In your opinion, what is management? Try to come up with a definition for this concept.

Stop! Dont skip this first task, or any of the ones that follow it. Im certain that you dont like theoretical work all that much, and you might even complain about how much hot air and how little practical material is in most management and leadership books. But heres the practice you wanted, and it will allow you to make sense of your own management. Please dont ignore this task; stop and do it honestly, and only then go on reading. Believe me, Im insisting on this for your own good.

So now we come to management. In the general sense of the word, were always talking about a certain meaningful action that leads to a necessary and expected result. The simplest example: when we drive a car, obedient to every movement of the steering wheel in our hands and pedals under our feet, nobody has any reason to doubt that were not controlling it. That management has certain limitations related to the physical capabilities of the car, which cant speed up past a certain point or stop instantaneously. But we can clearly distinguish this situation from another, where we might say that driver lost control of the car: when turning the wheel or any manipulations of the pedals dont have any result, as the car is being carried in a direction where we have no desire to go. I believe that the exact same thing can happen in any other situation: when we get an undesirable result over some length of time and cant do anything about it, we have to honestly admit to ourselves that we arent controlling that situation. There are two options here. Either were in a case like with the car, where we have lost control and can first formulate, then organize the necessary conditions for returning that control  or we never actually controlled the situation in the first place, and the fact that it was in some way advantageous in the past is in no way connected to any actions of our own.

I stopped and devoted so much attention to these seemingly obvious things because right now, the majority of readers will face a serious battle with themselves. Im going to assert things that are so sad, your subconscious will start trying to convince you of practically anything under the sun  anything to avoid believing these realities. Then mechanisms of self-deception, refined by all of your accumulated life experience, will come into play: well, of course youre right, and not the author at all. Whats more, how could he possibly compare if hes in a totally different job, or region, with different people, all in a different industry And who is this author anyways, and why is it worth listening to him?! No matter what regalia and qualifications I might have, they wont be weighty enough to warrant listening to; my experience wont be suitable, and my education will seem insufficient. Therefore, I wont even bother talking about them; instead, reader, I ask the following of you.

Task 2

For some time, turn off your inner critic and remember someone who held a great deal of authority in your eyes, whose words you always listened to, at the very least; imagine that that person is the one telling you all of these things, and then read the text in their voice.

I think youll agree that over the entire course of the 20th century, the very best leaders on our planet tried to create a certain kind of autopilot within their individual companies, all in the hopes of achieving the optimal result. But a cursory overview of business statistics would show you that nobody ever found this "sorcerers stone": companies both large and small, from around the world continue to run themselves into the ground, which we can hardly call a desirable result of their management strategies. Ill go on to bring in examples of negative phenomena in your organization: those that you know and dont like, but cant influence in any way, shape or form. How do I know about them? Theyre everywhere! For me, this means one thing in particular: leaders in companies have lost control, just like in the aforementioned example with the driver and the car. I understand that this is really hard to accept: after all, others judge us by how well we manage, and you probably measure your own success by the very same criteria. We spend lots of time and energy on this, and if were not the owners of a company, then we even get paid for this management! But how can we admit here that we dont do this? Still, I ask you to judge yourself not by the amount of time spent or how tired you are, but by the results of your actions. So lets look at what we have in the following categories.

Management expenses

A traditional system of management resembles a pyramid, where the chief executive is at the very top, and rank-and-file workers make up the foundation. Between them lie many layers of sub-managers. Their quantity depends on the size of the organization and its span of control: the average number of subordinates underneath a single manager.

Once you know the number of employees in a company and its span of control, you can always count the number of levels and the number of managers on each of them. For example, with a span of control of 5 and 156 employees, we have:

 125 rank-and-file employees;

25 middle managers;

5 upper managers;

and one chief executive.

What might the expenses of managing such a system be? In order to compare companies amongst themselves, it would be best to use the percentage of total expenditures on managers out of total payroll. For example, if a manager in our example company earn on average twice as much as their subordinates, then:

125 rank-and-file employees receive 1 salary each = 125 base salaries;

25 middle managers receive 2 base salaries = 50 base salaries;

5 upper managers receive 4 base salaries = 20 base salaries;

1 chief executive receives 8 base salaries = 8 base salaries.

In total, all of the managers in this company receive a total of 50 +20 +8 = 78 base salaries, which makes up 78 / (78 +125) = 78 / 203  38% of the companys overall payroll  which is a considerable line item of expenses for any company! Whats more, the bigger the organization, the more levels of management and managers, which means a higher percentage that their salaries make up out of the overall payroll, even though they do not create any of the added value for the client. Doesnt sound too inspiring, does it? But this is the most insignificant problem in a classical system of management.

Constantly overloaded management

In my consulting days, I thought that many managers didnt want to start the projects that their companies obviously needed due to their insufficient competency and lack of desire to admit as much in order to start studying the topic at hand. The reality turned out to be far more banal: extremely competent, hard-working, knowledgeable and industrious managers are in constant time trouble: they dont even have enough time to finish with the current routines being imposed upon them, like an avalanche in the mountains. All this happens, Ill remind you, because of the classical management system, where problems are escalated from the bottom up. As a result, the higher a managers level, the more subordinates they have and the more problems end up on their plate.

They physically dont have time to solve all of them, which leads to overwork during the week, regular work during the weekends and a lack of relaxation, even on vacation. But none of this helps, and tasks start to get stuck on a waiting list, and some of them get lost from sight forever in favor of more urgent and important ones. Meanwhile, the manager understands that the problem they themselves dont solve might result in serious losses both for the whole company and for themselves personally, leading to a state of constant stress that the manager or boss begins to project outwardly. This is especially true for those employees who inform them about new problems or are in any way, shape or form party to them. As a result, a confrontation between bosses and their subordinates begins, which only worsens the situation, since the manager must now spend their energy on that, too.

Slow problem solving

Meanwhile, the organizations real problems begin to get solved more and more slowly. After experiencing an inappropriate reaction from their managers, subordinates share information about new problems less and less frequently with the higher-ups, while lacking the necessary privileges and resource to solve them at lower levels. Whats more, due to the fear of having the dogs set on them, information starts to transform in order to protect the person sharing it  or, when such shielding is impossible, it gets completely stuck without ever reaching the boss. Interestingly, decisions traveling in the opposite direction experience their own losses as well. I conducted an analysis which showed that in transitioning from one level of management to another, around 30% of information gets lost. This means that if only 70% of information remains when an order gets to your direct subordinates, then in transmitting this order to the next level of management, you have to take 70% of these 70%: 0.7 × 0.7 = 0.49 = 49%, or less than half! Unfortunately, the information doesnt merely get lost, but also gets twisted: this means that the remaining 51% is filled with something else, often contradictory to your thoughts, words and desires.

Task 3

Multiply this 0.7 by as many layers of hierarchy there are underneath you, and understand how little of what you say gets through to those who will have to directly carry out your orders, and how much distortion is introduced in the process.

Is it clear now why nothing ever happens the way that you planned it?

Now lets look at the situation from the clients side, who has encountered some insignificant, minor problem and lets your subordinate know about it. Your subordinate cant solve the issue themselves and escalates it higher  what else can they do, when thats always how they act? But the problem isnt critical, you have more important and urgent tasks, and as a result, you put it off over and over again until at the end of the day you simply forget about it altogether. Then the exact same client runs into the exact same problem half a year later and understands that nobody even tried to take care of him. They tell the exact same employee, now with some surprise, that the problem could have been solved over all of this time. Your subordinate justifies their behavior, saying that they passed the clients wishes along to their bosses and assures them that theyll bring up the issue again. But even if they do exactly that, the result will be the same: you just wont get around to it. And after some time, the exact same client will run into the aforementioned problem. Now put yourself in that clients position: its not hard to imagine what they think about your company and its attitude toward its customers

Demotivation of rank-and-file employees

All this time, your subordinates find themselves in a very unpleasant position of being wrongly accused. If they report up, then they can be turned into a sacrificial lamb; if they conceal the information, they can be asked at any moment why such a problem exists, but nobody knows about it. As a result, the poor fellow is in a constant state of stress, and even if their manager still had some power to influence the situation, then the subordinate will only lose motivation, stuck in a position of dependency.

What happens as a result? We hire specialists to work on motivating our personnel and pay them salaries, but in actuality, everything that they concoct doesnt work for long. Theres some mysterious important reason that demotivates people within the framework of a traditional management system. This reason is learned helplessness. Well talk in more detail about this reason in the fourth chapter. Now Ill just say that the essence of this phenomenon comes down to the following: if we take an employees rights away, but nevertheless continue to ask as much of them as before, they will start fearing responsibility of any kind and begin to avoid it by any means necessary. This gives a person who is extremely demotivated and dodges responsibility as best they can, lacking any desire to make decisions. Meanwhile, its very important to understand that we are the ones who made them that way. After all, in everyday life outside the workplace, everything in this persons life is the polar opposite: they take responsibility for where they live and what they eat  and if they have children, theyre responsible for their lives, too! So why in the world do they turn out to be "insufficiently responsible" to be worthy of the permissions necessary to make the simplest decisions for the company?

Mass irresponsibility

Whats going on inside the organization? Both managers and their subordinates are becoming hostages of a system of management under which its best not to be responsible for anything at all. This became the reason for an unbelievable dearth of good managers, despite a surfeit of qualified specialists. After all, who would be clamoring to take on additional responsibility for other people, too? In such a situation, those who are solely interested in career growth and power begin to flourish. As a result, the situation gets even more complicated: after all, such people consciously surround themselves with others who cant compete with them and intentionally inflate their staff numbers to seem like more significant managers.

Meanwhile, other employees initially protest at the sight of such phenomena but then, when they understand that their concerns are not being heard, they also begin to lose responsibility, asking themselves, What, do we really need this? Why should the buck stop here? They pass the requirement to figure problems out onto their supervisors, who ultimately have no time to do so, since theyre already so busy in the first place

Wars between divisions

In a situation where nobody wants to take responsibility, wars unavoidably begin to brew between departments and divisions, which also has a negative influence on the overall results of the companys work. For that matter, it is the divisions that have to work most closely together in order to achieve their common goals that fight the most often! Its not hard to guess that the reason also lies in the management system.