But, We Have a Company to Run

“But, we have an airline to run,” Samuel continued to object. “As chairman of the board, it is my primary responsibility to make sure we have the right person at the helm. It is not my responsibility to micro-manage you, meddle in the way you run things. But, the way you run things makes me wonder if we have the right person at the helm.”

“Look, Sam,” Catherine replied, “we can squeeze the legroom, rearrange the seating on the planes. We can start charging for checked baggage. We can add a service fee if someone wants a soda. But that is not our problem.”

Catherine looked intently at Sam, sitting at the head of the boardroom. In the periphery, she could see the logos of the other companies in the portfolio. Outbound Air was the company in trouble and she had been selected to turn it profitable. She continued.

“Sam, we have close to a thousand employees now. They work 40 hours per week. Economically, they depend on us. Our compensation system and job opportunities directly impact how they live, now, next week and next year. Their self-esteem, what they achieve in life, in large part, depends on the role they play for us. How we set expectations, how we define their working relationships, how we evaluate their effectiveness, all, have direct impact on their contribution. They come home at night, frustrated or satisfied based on how things went that day. The way we design the environment of their work has way more impact on our bottom line than any fees we may charge for luggage.”

The saga of Outbound Air continues. Find out how Catherine got here.

Kiss Off

“Catherine, we hired you to run this company, and we want to give you free rein, but you must admit that some of your initiatives don’t translate into profit for this quarter.” Samuel Pierce was chairman of the board. He was not happy, but he was willing to listen.

“Sam, you didn’t hire me to focus on the next three months,” Catherine replied. “This company has some real problems that will take time to repair. In the short term, we will suffer. We will suffer some profit. I am not here to turn a single quarterly number. I am here to create a sustained profitability stream.”

“But, these employee initiatives are going to erode profitability. You want to change the wage structure. Your personnel plan adds in management overhead. These are long term things that will last beyond the next quarter. Are you sure you know what you are doing?”

Catherine took a moment. “On the surface, my role is to operate the business functions, define the metrics, create revenue and hold expenses. We can do that, and, in the short term, we can make a tidy profit. AND, my role is to create a sound and effective managerial system that will sustain those business functions. As CEO, right now, I have to focus on our people system, because it’s broken. As long as the people system is broken, you can kiss off all the rest.”

The saga of Outbound Air continues. Find out how Catherine got here.

Structure and Culture

Thinking out loud here.

During the past two days, I have laid out posts related to –

  • In spite of clear work instructions, does culture trump output?
  • In spite of personality inputs, does culture trump output?

If you learn anything about me, you know that I am a structure guy.

  • For those who think their organizational challenges revolve around personality, I tell you, it’s not a personality problem.
  • For those who think they have a communication problem, it’s not a communication problem, it’s a structure problem.

Structure is the defined accountability and authority in working relationships, both managerial relationships and cross-functional working relationships. Structure is the context, in which we work.

Culture is that set of beliefs that drive our required behaviors in the work that we do together. Culture is the context, in which we work.

So, I am beginning to wonder if organizational structure and culture are inextricably tied together. Does structure equal culture? Does culture equal structure? Do the warm and fuzzy concepts of culture have a science underneath defined by levels of work and structure?

I believe so.

Culture Trumps Personality

“Yes, my work instructions were very clear, but we still had re-work on the back end. Like the team didn’t listen to what I told them. Even after I had them repeat the instructions back to me. I am a new manager to this team, but they seemed to understand what I said,” Rory explained.

“Tell me about the team,” I wanted to know.

“Not much to tell. When I took over the role, I asked to see the employee files. Our company does a pretty good workup on personality profiles, even for technicians. The profiles were normal, what I would expect. The company even created a standard profile for a technician that they were hiring to. Each team member was pretty much the same. They each showed attention to detail, compliance to rules and standards, persistence to complete a project. I don’t understand what happened to them.”

“What do you think changed?” I asked.

“It’s like they were different people when they took the profile and when they were actually in the work environment. It’s like when they walked out onto the field of work, things changed,” Rory shook his head.

“What do you think changed?” I repeated.

“The work environment,” Rory was searching for an answer. “The environment they were working in did not demand the attention to detail, compliance or persistence they had all demonstrated on their profiles.”

“It was a different context?” I wondered. “It was a different context. So, the work environment, the context trumps personality?”

For a more complete example of Culture Trumping Personality.

Culture Trumps Clarity

“But, I set the context for my team. We talked about the work we would receive from the process step before. We talked about how we would inspect our work before we handed it off to the next process step. I thought I was very clear,” Rory complained.

“So, what happened?” I asked.

“It’s like the team wasn’t listening,” he replied. “I even had them repeat the steps back to me, to make sure I was understood.”

“So, what happened?” I repeated. “Why did you feel the need to be so explicit? Why the need for clarity?”

“We’ve had quality problems out of this team, seems like, forever. They don’t seem to care. They come to work, go through the motions. End of day, they head home. That’s why I was called in to manage this team.”

“So, what was different, after you explained the sequence, described the context for their work?” I probed.

“Nothing changed. We had the same incidence of quality re-works. Almost like shoddy work is part of the team culture.”

“So, what you are telling me is that culture trumps clear work instructions?”
Interesting perspective from Gustavo Grodnitzky in Culture Trumps Everything.

How to Predict a Departure

“Who is responsible for the team?” I asked. “Who is responsible for the performance of the team, and all the things that affect performance?”

Melanie looked around her office, as if someone was going to appear.

I continued. “If it’s not you, as the department manager, if it’s not you, then who?”

Melanie’s eyes stopped skirting the room. No hero appeared. She floated her excuse, “But how am I responsible that one of my team members quit?”

“That’s a very good question. How are you, as the manager, responsible that one of your team members quit?”

“What, am I supposed to be clairvoyant?” Melanie snapped.

“That would be helpful,” I nodded. “But let’s say you don’t have supernatural powers. How could you, as the manager, know enough about your team, to have predicted this departure?”

Who Sets the Context of Work?

“But, you are still here. What’s in it for you? What keeps you here?” I asked.

Riley had to think. Turnover on his team was high. Morale was in the dumps. He described his team as lifeless. “I guess I just don’t feel the same way they do. I know the work is hard. I know we have to pay attention. I know the work doesn’t stop at 5 o’clock. But for some reason, for me, it’s important to be here.”

“Why do you think it’s important for you and not so important for your team? At the end of the day, you are all working on the same projects.”

“Well, my manager and I talk about the work,” he explained. “We talk about the results of the what we do, as a company. I feel that I make a contribution, as a manager. What I do is important. In spite of how hard it is, it’s important.”

“You feel that way, because you and your manager talk about the work, the importance of the work? Have you ever talked about the work with your team?” I asked.

“Yeah, but, it’s different with them. I mean, they don’t get the whole picture. They don’t seem to understand it the same way that I do. For them, it’s just a job.”

“So, the context of their work, is that it’s just a job? Who is accountable for creating that context?”

They Don’t Get Yelled At

“How long has your crew been together?” I asked.

“Humph,” Riley snorted. “A couple of people have been here over a year, but most, just a few months. Lots of turnover.”

“And what is the cost of that turnover?”

“Expensive. It’s not that the work we do is that complicated, but there are so many details to keep track of that it takes a while to get your arms around everything. And we don’t do much formal training, more like shadowing other people on the team who have been here. Seems like just when we get someone trained up, they quit.”

“So, what’s in it, the job, I mean, for someone who sticks with it, pays attention to detail, sniffs out problems before they mushroom?”

Riley was quiet. “They don’t get yelled at,” he replied.

The Reactor Doesn’t Melt Down and Nobody Dies

“I don’t know why my team is behaving this way,” Riley complained. “I know we drive our people hard, and I know we expect a lot from them, but they knew that when they signed up for the job. We are a very intense organization.”

“How are they behaving?” I wanted to know.

“You can see them dragging into a meeting. Smiles are few and far between. It’s like they need a vacation really bad. Bordering on burn-out. I know we expect them to be responsive on their smart-phones, even after hours, but we are in the service business. We don’t know when our customers are going to call, or some project is going to go sideways.”

“So, in addition to working a normal day-shift, they are on-call after hours?”

Riley nodded. “Yes, but they get on-call pay, even if nothing happens. And we rotate that, so it’s not like it’s every day.”

“So, what is causing the fatigue,” I asked.

“I don’t know. It’s just that we are intense. If we relax, details get missed. And, missed details can turn into real problems. We have to keep our guard up.”

“And, if you keep your guard up and no details are missed, what happens?”

Riley had to stop and think. “Nothing special. Things go smooth, no one panics, but it’s not like we win the Super Bowl.”

“When your team does a really good job, it’s nothing special. So, who appreciates it, when they do a really good job?”

“No one really,” Riley admitted. “A really good job just means that no one is upset, mostly the customer.”

“Kind of like running a nuclear power plant,” I said. “If we do our job well, everyone gets electricity, the reactor doesn’t melt down and nobody dies.”

Sure Fire Participation

“Yes, but if people are afraid to participate, afraid to contribute their ideas in a meeting, how do you deal with that?” Reggie asked.

“Do your team members have ideas?” I responded.

“Well, yes, some sort of an ideas.”

“So, the problem is, to get the idea out of their head, with zero possibility that it might be rejected by the group? How would you do that?” I stared at Reggie while I reached over and pulled a pen out of my pocket and set it on the table.

“Get them to write their idea down?” Reggie guessed. I nodded. “But still, how do you get them to share their ideas with each other, with the group?”

“It’s too late, the idea is already out of their head. By the way, what happens to the quality of any idea as it moves from the mind to a piece of paper?”

“Well, it improves.”

“So, now, each person owns a much improved idea on a piece of paper in front of them. Divide the group into teams of two or three and have them share their idea with that small group. I guarantee, there will be no hesitation in that small group.

“The next step is to have the small groups report their ideas to the large group. The quality of ideas will be very high and everyone will have participated. Remember, the purpose of this meeting was simply to get your people discussing ideas with each other.”