Who Has the Authority?

“I have to change. Me?” Vicki asked, not sure if she could believe her ears.

“I am going to hold you accountable for the results of your team,” I said. “What do you have to change?”

Vicki was not pleased. “Well, if you are going to hold me accountable for the results,” she stopped. “I have to pay attention.”

“Yes, you do. As a Manager, what do you have to pay attention to?”

“I may have to be more hands on,” Vicki replied.

“Yes,” I nodded.

“I mean if someone is out sick and you are still going to hold me accountable for the results of the team, then I might have to fill in.”

Only in an emergency. You are a Manager. I expect you to drive a forklift only in an emergency. Come on. You deal with statistical fluctuations of many elements all the time. What are you going to do?”

“Okay, so we are talking about cross training, maybe borrowing a member of another team, considering overtime. You know, 30 is really an arbitrary number. If we were short one day, we can likely make that up over the next couple of days, as long as there were no late ships.”

“I want you to think carefully. Are any of those decisions, cross-training, borrowing a member of another team or using overtime, within the authority of your team members? Can any one of them make those decisions?”

“No.” Vicki shook her head slowly.

“And yet, those are the decisions that produce the results. That’s why I hold you, as the Manager, accountable. What else has to change?”

Too Much Humidity

“It’s not your fault that your most valuable team member is out sick, but I will still hold you accountable for the results from your team. What has to change?” I repeated.

Vicki was still stumped.

“Vicki, let’s look at all the variables that could have an impact on production. You are focusing on the team’s manual assembly. Do they work at different rates on different days?”

“Well, yes, sometimes, they work better when there is loud music playing, awful loud music,” she replied.

“So, some days are up and some days are down. I call that a statistical fluctuation. What other elements could cause a statistical fluctuation?”

“Oh, well, there are a number of things. Sometimes our tooling or tools get worn and they just can’t do the job at the same rate, until we change them out. Sometimes our raw materials aren’t quite the same and we have to stop and make small adjustments to accommodate. Heck, sometimes, too much humidity can affect the setup time.”

“So, all of those things, including the manual assembly can create statistical fluctuations in production?” I noted, making a small list on a sheet of paper.

Vicki nodded her head. A smile crept across her face. “You are right. Those are the things that create havoc in my day.”

“And who is responsible for solving those problems and making decisions, making adjustments to build 30 units a day?” I was looking straight at Vicki. “What has to change?”

Your Fault My Fault

“You’ve talked about this before, but I want to make sure I understand it. We need to get 30 units out of this team every day, 15 in the morning and 15 in the afternoon. Right now, if they don’t make it, as their Manager, I get pissed. If it happens two days in a row, double-pissed,” Vicki stated flatly.

“And if that’s the way you see it, then, your system will create behaviors that don’t help,” I replied. “Thirty units a day is your goal. You are responsible for the results from your team. If I hold your team accountable for doing their best and I hold you, as their Manager, accountable for the results, what changes?”

“But what if they show up late for work, or take too many breaks, or slow walk the line? That’s not my fault. If they do that and I don’t reach my goal, how is that my fault?”

“You are still fighting it,” I responded. “If I hold you, as the Manager, accountable for the results of your team, what changes?”

Vicki was stumped. She drew a deep breath. “If you are going to hold me accountable, then I have to make sure my team all shows up for work. I have eight people and with all the cutbacks, it takes full effort to reach my goal.”

“And, what if, one day, your most valuable team member is out sick, truly sick, and I hold you accountable for the results from your team?”

“But if someone gets sick, it’s not my fault!”

“It is not your fault that someone got sick, but I will still hold you accountable for the results from the team. What has to change?”

A Shift in Accountability

“They don’t give me an early warning because if production is late, they know I will be upset and I will want to know why they failed to produce the desired result, I guess,” Vicki winced. “If I don’t find out about an order that’s late, I can’t get angry. At least until the customer calls. That’s when emotions flare up.”

“And how many of your customers don’t call when you are late?” I asked. “If you are using your customer as your QC system, is that where you really want to be?”

“I know, I know,” Vicki replied.

“So when you hold your team accountable for your result, as a system, it creates behavior that is not ideal. You don’t truly find out about production pacing until there is a visible breakdown. What can you shift to make that change?”

“You are suggesting that I am the one accountable for the team’s results?”

“More than a suggestion,” I replied.

Early or Late?

Vicki was almost laughing. “Do you mean, that if my team can work faster, finish early, they are supposed to tell me? I’m sorry, my team will expand the work to whatever time frame they think I will buy.”

“I understand that,” I replied. “That is actually Parkinson’s Law. Work expands to the time allotted. So, what is it about your system, as a Manager, that has created that circumstance?”

“Well, it’s not me, that’s just the way my team is. I mean, they are not bad people, but if I give them until noon, they will take the whole time. That’s just the way they are.”

“Vicki, I want you to think about the opposite of the same circumstance. Let’s say, instead of being able to finish early, your team cannot get all the work done and will finish late?”

“Oh, well, that is a completely different story. That’s when things get testy around here, that’s when the wheels start coming off. They never let me know, usually until it’s too late, until the deadline is past. Sometimes, unless I am on top of every order, I don’t find out until the next day that an order is still being worked on.”

“So, what is it about your system, as a Manager, that has created this circumstance, that you are not given an early warning about task completion, early or late?”

Toward a More Accurate Prescription

“To determine the cause of the problem,” I continued, “you have to look at more than symptoms. Look at any medical doctor. Before they can prescribe a remedy, they are trained to look at very specific things. I assume you have a physician?” I asked.

Sarah laughed, “Of course.”

“When you go to see the doctor, after the pleasantries, what does the doctor ask about?”

“That’s easy,” Sarah said. “She asks me where it hurts?”

“Not only where does it hurt, but is the pain specific or general? Is it an ache, or a sharp stick? Does it happen all the time or only occasionally? If only occasionally, what happened right before you noticed the pain?”

“Yes,” Sarah nodded.

“These are symptoms, the kind of things your team members complain about,” I said, “but they are only symptoms. But while the doctor is asking you about your symptoms, what else is she doing?”

“That’s funny,” Sarah replied. “While she is asking me questions, she is listening with her stethoscope, tapping my knees with a little rubber hammer.”

“So, not only is she listening for symptoms, she is also looking for signs. Symptoms, the things you (your team members) complain about may mislead. The doctor must also look for signs, evidence of something amiss. That is the point of diagnostic tests, blood work, x-rays.”

“That’s it?” Sarah asked.

“Nope. With the symptoms and signs, the doctor must now rely on a theory that ties them together. When you described the feedback you got from your team, that there was a communication problem, that was only a symptom. In addition to the symptom, we also have to look for signs, like a reduction in productivity or confusion in delivering our services. And, with those two together, we now must rely on a theory that ties them together to arrive at the proper diagnosis.

“Your communication seminar was based on a breakdown in communication. Your outcome from the communication seminar was neutral at best. More likely, the problem occurred from an absence in defining the accountability and the authority in the working relationship. Accountability and authority is a completely different organizational theory than a communication theory. Only when we apply the right framework, can we make a more accurate diagnosis and prescription.”

Because We Said So

“Just to be clear,” Sarah wanted to know, “if communication is the symptom, but accountability and authority is the cause, what’s the fix?”

“You already told me that your communication seminar did not make any improvement. Is your answer embedded in your question?” I asked.

“We have to fix accountability and authority?” she angled her head to the side. This was not a rhetorical question.

“Let’s take the easy example,” I replied. “Two people who have to work together, but, neither is each other’s manager. Let’s take your Marketing Director and your Sales Director. In that working relationship, what is the accountability and what is the authority?”

“Well,” Sarah started. “They are not each other’s manager, so there is no accountability and no authority. They are professionals, they should each know what they are supposed to do.”

“Oh, really,” I nodded. “Would it be a good idea for marketing to coordinate with sales and for sales to coordinate with marketing?”

“Yes, I suppose,” Sarah concluded.

“If they are supposed to coordinate, but they don’t, what kind of problems emerge? And, does that look like a communication problem?”

“Yes, that is what we were trying to fix in the communication seminar,” Sarah smiled.

“But, it didn’t get fixed, because it wasn’t a communication problem, that was only the symptom. What you had was an accountability and authority issue. If it would be a good idea for them to coordinate, if the Marketing Director calls a meeting with the Sales Director, is the Sales Director accountable to attend?”

“I’m not exactly sure,” Sarah winced.

“You are not sure because you did not define their coordinating relationship. By virtue of the fact that the two are in a coordinating relationship, if one calls a meeting, the other is required to attend. Of course, they have to mutually schedule the meeting, but they are required to attend. Why are they required to attend?”

“I am still not sure,” Sarah winced twice.

“Because we said so,” I stated flatly. “By virtue of their coordinating relationship, they are required to attend. Further, they are required to do what?”

“Coordinate?” Sarah was catching on.

“Exactly,” I said. “Now that we have specifically defined the accountability in their relationship, do we have a communication problem?”

Not a Communication Problem

“I am a bit confused,” Sarah explained. “As an executive management team, CEO included, we were frustrated about some issues that were not going well.”

“And, what did you do?” I asked.

“We thought it best to take a survey, kind of a company climate survey, to let everyone chip in and express their opinion about things gone wrong and how to fix them,” she said.

“And, what did you find out?”

“Just as we expected, a large number, more than 50 percent described our problems, related to productivity and morale, as a communication issue.”

“And, how did you go about addressing the issue?” I pressed.

“We hired a communication consultant, and held a series of communication seminars, so everyone could attend,” Sarah stated flatly.

“And, the results?”

“It’s been two weeks. At first, everyone was fired up. People were being nice to each other, but, here we are two weeks later and nothing has really changed. Productivity statistics are unchanged and we still experience heated exchanges about who is to blame.”

“Do you think communication is really the underlying problem?” I wanted to know.

“When you use the word – underlying, it leads me to believe I am looking in all the wrong places,” Sarah sighed. “So, is communication the problem, or only a symptom of the problem?”

“Let’s assume, for a moment, that communication was accurately identified by your survey as a symptom of the problem,” I floated. “What might be the underlying cause of the problem?”

Sarah had to stop, a bit of silence. She finally spoke, “Some people in the survey said they were unnecessarily blamed for things going wrong, that it really wasn’t their fault. Others said that if productivity was really wanted, that the incentive program should be changed. Some said they knew how to fix some of our problems, but they didn’t have the authority to make the decision, they were overruled by their manager.”

“I think we are moving away from the symptom, and getting closer to the cause,” I observed. “Most people, when they call me, tell of a communication problem. After some time, I can usually convince them that communication is not their problem. It’s usually an accountability and authority issue.”

Looming Uncertainty

“While timespan helps us understand the capability required for the role,” Pablo explained, “it also applies to the CEO.”

“I’m listening,” I replied.

“The cause of many organizational issues start with the CEO. Sometimes, in the pursuit of growth, the organization outgrows the timespan capability of the founder. It’s not just headcount or revenue growth, the company could step afoul of a regulatory issue, or an unexpected quality problem.”

I nodded, “I have seen that.”

“When the organization outpaces the capability of the CEO,” Pablo continued, “often he or she will clamp down, contract the size of the business. While this may relieve the CEO, provide the appearance of being in control, it can also create issues for those people around the CEO. Some may possess capability in the same band as the CEO and see their own initiatives constricted. This constriction will painfully trickle its way down the organization. In the CEOs effort to bring the company within the illusion of control, budgets may become unnecessarily limited, capital expenses may be delayed, key hires postponed. All of this is caused by the looming uncertainty, with which the CEO can no longer cope. An organization can grow no larger than the comfort level of the CEO.”

The Girth of the Organization

“Why do most startups fail?” I asked.

“The standard answer is that they are undercapitalized,” Pablo replied. “But, I believe that is only a symptom of a larger problem.”

“The larger problem?” I pressed.

“Most startups begin with an idea, that the founder believes may have viability as an enterprise. It is this beginning of an idea, only vaguely formulated, where the trouble begins,” Pablo replied. “You have to start with the founder and the development of the business model, and ask how big?

“How big?” I asked, in a wandering sort of way.

“Think of big in terms of timespan. If the founder only thinks about the first handful of customers and the fulfillment of the first handful of orders, that is as far as the business will go (grow). More mature organizations answer longer timespan questions related to the mission and vision of the organization. The most often missed characteristic in both of those documents is the concept of by when?

“By when?”

“For the founder, meaning initial stakeholders, entrepreneur, investor, private equity, board of directors, the initial question to task the CEO is what is the timespan of the mission? Timespan will determine the girth of the organization going forward.

“And, this is where the standard reason of undercapitalized emerges. Most startups don’t have the resources to deploy more than the first handful of customers and orders, so that is where the thinking stops.

“Those organizations that more clearly determine their mission, the timespan of the 3-4 critical goals will have greater clarity on what kind of organization must be built. And, the biggest accountability for the CEO is to build that organization.”