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“Do you trust your employees? If not, the problem is about you and don’t blame the team! If yes, then you can unleash great performance and be the company’s rock star”

 A couple of days ago, I had the opportunity to speak in front of a high school class around the topics of leadership. It turned out to be a great discussion on motivation and personal growth – and I am happy to learn that there are many clever high school students with the right mindset and ambition. We talked about good and bad leaders, mental barriers, how to beat FC Barcelona, setting goals and how to get better grades in school. Great day!

The last couple of blog posts have focused on governance, value of IT, benchmarking and cost efficiency. The common denominator for all of these topics is the importance of culture and leadership, and in essence “trusts”. The fact is that trust sets the pre-requisites for a performance culture where business value is creates, cost is at efficient level and employees are happy. The purpose of this blog post is to give my view on how culture and leadership impact trust, and how to increase performance in an organization with few simple leadership advices.

I often hear leaders talk about what their vision or goal for the year is and in many cases it is “no surprises”. What does that actually mean? I interpret these words as “let us remove all sources of deviation and have absolute control of the situation – I want a smooth ride”. The fact is that this vision is impossible as change and deviation is a natural part of our business life – and will with all certainty increase in magnitude. Wouldn’t it be extremely boring with a “no surprise” life or company working based on that principle? However, the message has an impact on the organization as it actually increases control and measurements to achieve the “smooth ride”. Even further control systems are introduced to make the leader “comfortable”. Think the amount of time spent by controller and managers to control the organization – and at the same time, how much time is spent on actually steering the organization? Wouldn’t it be interesting if a leader actually said – “I want a bumpy road with lots of deviations to plan! That is our way to success!”

Traditional governance models, focusing on budgeting, planning and KPI performance management, are based on “command and control” management style. Bureaucratic and suffocating control systems are built up to force result in the organization. Information is hidden from key individual, as they are not trusted with the information. Employee’s time and work tasks are controlled through job description and time reporting – and deviations are analyzed in Excel sheets to find someone to blame for not meeting targets. It is not system built on trust but rather on control.

My view is that the problem is how we view employees and people. No one can argue that our employees are the most important resource. In our world of standardization, commodization, and cloud services – people is the key competitive advantage of an organization. That’s what makes a difference! People can drive change, decisions and creative product development – not systems or processes. It is people that are best at understand and interpret complex situations – no matter how sophisticate Business Intelligent tools we have. Tools are valuable from an automation and information management perspective – but they still only support people’s judgment and decisions.

Still, many leaders view their employees as irresponsible, unambitious and not trustworthy and therefore need to be controlled though job descriptions, detailed budgets and planning. An interesting perspective here is that this view (McGregor: theory X) was relevant before 1950’s when many employees were uneducated and mainly did manual production work (non-creative). Bonus systems were introduced to increase engagement. And it worked! The productivity increased rapidly! But today’s business environment is different. Employees are highly educated, determined and having more creative and management jobs. This means that the “old” view on employees needs to change – if we do not want to suffocate ambition and drive. I also want to question the whole idea of bonus in today’s business environment because it has been proven over and over again that it has no impact on management performance. If an employee needs a “bonus” to do his job properly – then maybe that is the wrong workplace for him/her. That is a discussion for another blog post.

So, what does this discussion about people and trust has to do with performance? We’re performing well with traditional control systems? I do not argue that you are not performing well – I am asking how well could you perform with additional trust in the organization. How well would an athlete run with proper shoes instead of sandals? How well does a tennis player perform with a racket from the 1950’s? Those are the questions we should ask ourselves. What can we do to boost our performance by questioning our “selected truths” about where we operate and live?

From a performance management perspective, it is easy to see what kind of employee and management behavior is needed to raise performance. The Customer Intimacy governance model is outperforming the Operational Excellence model (see earlier blog posts) and it requires new views on leadership and culture. Customer Intimacy is about utilizing customer knowledge to optimize customer value in an adaptive way. It is about having a business mindset. Also to understanding that the purpose of IT to make business successful. IT has no purpose on its own but rather in play with other units and functions. What does this have to do with leadership?

The key success factor for achieving a Customer Intimacy model is to unleash the performance of teams by leadership built on trust. Studies shows (BBRT 2013) that governance models based on “command and control” (Operational Excellence) generally give lower team performance (business value) than those focusing on an adaptive and self-governing model. So, trust is the foundation for achieving high performing teams. What does this say about you as a leader?

Do you believe in your employees? If not, the problem is about you and don’t blame the team!

It is interesting to notice how the culture of an organization is a reflection of management behavior. If the management act in some way, then the rest of the organization will follow – as that behavior become a value of the organization. In the same way, if management shows lack of trust against his/her employees, then the employees will act the same way against each other. If management prioritizes control, then control is going to be the guiding principle for the organization. The conclusion is that leadership and management behavior has enormous impact on the culture of an organization. To change culture therefore starts with manager and leadership. So, if you as a leader want to unleash performance in your organization – then you have to openly display trust in everything you do.  It is as simple, and difficult, as that.

A key question is to ask what kind of behavior does you as a leader what in your organization – and then act accordingly. Reward employees who act according to set behavior!

 Recommendations:

  • Ask yourself: what kind of behavior do I want in my organization. Start by action according to that selected behavior and show that it is ok.
  • Ask yourself: do you trust in your employees? If not, then you have a problem – deal with it. If yes, congratulation – then utilize that trust to unleash performance!
  • Ask yourself: how much control do I actually need? What is the minimum amount of control needed for you to sleep at night?
  • Ask yourself: how much time do we spend on control and how much time do we spend on value creation? Are this balance right?

In the leadership lecture with the high school students, we discussed about motivation and how to beat FC Barcelona. The way to raise performance, and beat FC Barcelona, was actually to remove the mental barriers saying that you cannot do it. To demolish the “comfort wall” that we raise around us to feel safe. With right mindset, coaching and leadership – any mission is possible. Trust in yourself to perform. The high school kids understood the trick.

To trust people is also about remove a barrier. The beautiful part is that employees generally can be trusted and are ambitious. The barrier is your own and you have to deal with it. But if you as a leader do not think it is possible – then nothing will happen. If you think it is possible – then you will unleash great performance – and be the rock star of your company!

Hans Legend 1