Education, tools and leadership

There are numerous programs, schools and methodologies helping to understand and learn how to manage business and people:  different master of business administration (MBA) schools with their own programs and almost abundant methodologies and tools they teach their students.  Unfortunately no one ever learns whatsoever about e.g.: ecology at an MBA or in their programs. Unethical business and environmental practices of some MBA students are uncovered consistently.

Responsibility across the broadest spectrum of society is vitally important to the future of the global economy. Having said that the key question in today's business environment still remains: do all those programs, methodologies and tools really come out the way we need them to?

The biggest issue to introduce all of the different programs every couple of years or so is mostly based on the matter that companies are entirely dismissing experience if you do not have a degree. This is short sighted and even negligent but attractive  to those that want higher salary, better career opportunities or better consolidated business network. The second matter is that different methodologies and tools get sold to C-level as a silver bullet that is going to fix all of their issues, problems and will bring out the solutions.

But to probe even deeper - it is not the methodologies or the tools that bring solutions or break problems. They are good and they work when they are just frameworks to organize efforts. The important and mostly overlooked aspect of application of methodologies and tools is: they need to be based on the business needs, culture of organization and should be properly trimmed to benefit from using them.

Consultant - Coach

There is quite a selection of titles for people offering services to businesses such as: adviser, consultant, mentor, coach. In the last two decades in organizations business coaching has become increasingly popular to assist executives, managers, and employees in their personal and professional growth. How and what makes us decide that in particular case if we need a business consultant or a business coach?

As both, coaching and consulting process, are built on trust and confidentiality to differentiate them one can pose the following questions:

• Do they question and listen?
• Do they spend most of the time talking?
• Do they offer alternatives and let you make the choice?
• Do they tell you what to do?
• Do they think they know all of the answers?
• Do they appear to ask the right questions?
• Do you learn from them?
• Do you end up wiser or not?

The above questions help, but to determine which business service you actually need, more description is needed.

Organizational success and failure

An organization exists because of participation of employees who work in it. It is like a living organism: the brains are represented by the board of directors; vital organs are main managerial posts. The rest are employees. However, when one organ fails in a human body it is a problem for the whole body. If it works perfectly, the importance of each and every part goes unnoticed.

The organizational success or failure is hardly a one man game. The days of a single great decision maker at the top have shifted to strong decision making skills at all levels and across groups. No organization succeeds or fails based on the responsibility of only one individual. Yes, the leader holds the power to make the decisions and has the ultimate (not sole) responsibility. But a leader can only be held responsible within a reason for that which was in his/hers control.

We know today, supported by research, that the capacity to exercise control does enhance results. Also well explored is the fact that a company's culture is pushed down from the top. Companies that have failed, such as ENRON, have had management that abused the trusted power. The employees simply did what they were told to do. This proves to be a rigid culture lacking of transparency game. Another example of a rigid culture and leadership vision deficiency can be perceived in Kodak’s case where leadership somehow didn’t notice the shift coming in the technology related to films used for photographs.

Middle manager and leadership

There are many different roles in a work environment, but those that stand out and are most visible are the roles of leaders and managers that represent the company, specially the top ones. Readily available are numerous articles describing their role and their way of leading /managing people. Mostly described as a workforce are those on the hierarchy bottom: they work as they are told to. Here, I’d like to challenge your opinion whether they represent ‘the cost’ or ‘the asset’ of an organization. In between there is a number of intermediate managers being subordinate to the senior management but above the lowest levels of operational staff.

Duties of a middle management typically include carrying out the directives of senior management at the operational level, supervising subordinate managers and employees to ensure functioning of the organization. Middle managers are rarely a prime focus during the changes in the organizations because they are badly needed in order to execute whatever upper management comes up with. Since companies have slimmed down and cut out many organization levels they lack of the career advancement opportunities. In reality they are mostly the physical embodiment of the culture or rather bureaucracy level of an organization.

Management practices and tools that just “don’t work”

From the management’s perspective managers perform tasks, manage people and do business. Accordingly, there are numerous methodologies and tools helping to manage business and people:

(1) In Japan at Toyota Motor Company, Taichii Ohno and Shigeo Shingo incorporated Ford’s type of production and some other techniques into an approach named the Toyota Production System or Just In Time Production (JIT). The inventory strategy strives to improve a business return on investment by simultaneously reducing in-process inventory and associated costs.
(2) The core idea of a Lean organization is to maximize customer value while minimizing waste. Simply, lean means creating more value for customers with less resource.

(3) Iwao Kobayashi’s 20 keys is a longer list that can be used in manufacturing audits. It reads very much like a “who’s who” of manufacturing innovations and hence makes a very useful checklist.

(4) Six Sigma (6б) is a business management strategy originally developed by Motorola in 1981. It was initially aimed at quantifying the defects that occurred during manufacturing process first and then at reducing those defects to a very small level.

(5) Business Process Reengineering (BPR) is a top-down approach in which organizations become more efficient and modernized. Reengineering is a fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, speed and service.

(6) The Self Directed Work Team (SDWT) is perhaps the most powerful organizational concept that motivates, coordinates, solves problems and also makes better decision than an individual could. But this performance comes at a price: decisions are slow, work teams require extensive training and months to mature.

(7) Total Quality Management (TQM) is a set of management practices throughout the organization geared to continuously improve the business processes in order to ensure that the organization consistently meets or exceeds in satisfying a customer or a supplier.

(8) … others.

Organizational change

Organizational change is, or should be, just one of the processes within the strategy’s frame and company vision. Why then companies have to “struggle” when introducing changes? Why do they need to change? Ever changing environment, markets, products are just pushing the limits of a current stability of the companies and provoke never ending chain of changes.

In his blog Bernard Marr says “a good mission statement articulates the purpose of the company, basically why it exists, what it does and for whom. It should serve as an ongoing guide that spells out what the company is all about. The mission should focus on the here and now.” And where do we see a necessity for a change that a company should follow? In “a vision statement where the goals and aspirations for the future are outlined. It creates a mental picture of a specific medium-term target and should serve as a source of inspiration.”

But are these definitions enough to smoothly drive a change? Company’s organizational culture, as described in the previous blog: “Organizational culture and martial arts,” is the sum of values and rituals defined by rules. It is also a part of a “bigger picture” that surrounds an organization and each of us, as I explained in my TedxTalk. And these substances present difficulties or even block a change. Employees of a company, as others, are perceiving stability as security therefore opposing changes. Consequently, a permanent conflict prevents a peaceful process of change.

Corporate governance in multicultural organization

Corporate governance refers to the issues associated with the way corporations are structured, managed and operated. The use of the term “corporate governance”, the evolution of the concept and what it entails has started in the early 1980’s.

 Among the first was the Cadbury Committee. They defined the purpose of corporate governance in 1992 namely, as a set of processes, customs and policies that frame the business of the company and help manage the subsidiaries. This is then operationalized in a uniform method through administered or controlled directives.

The most quoted and referred to document in this field is the OECD principles corporate governance. OECD defines it as a set of relationships between a company’s management, its board, its shareholders, and other stakeholders. Corporate governance also provides the structure through which the objectives of the company are set. The means of attaining those objectives and performance monitoring are determined. So, the main recommended principles are stated as rights and equitable treatment of shareholders, interests of other stakeholders, role and responsibilities of the board, integrity and ethical behavior, disclosure and transparency.

Organizational culture and martial arts

Organizations are made for employees to work there and not opposite: employee should fit the organization. As the organization grows larger and more complex, management at the top lead and decide less by firsthand experience, but rather more and more on heavily processed data. From their standpoint they rarely see business flowing in the same way as do people down in production or on the sales floor. To understand huge amounts of data and information that is streaming toward them, after a throughout long training, they finally achieve to see the reality through the distorting glasses they've had to put on. Decisions they make and the responsibility they shoulder relies on tangible data. But these glasses somehow filter out emotions, feelings, sentiments, moods, and almost all the nuances of human situations that are part of everyday organizational culture consequently filtering or better losing all the tacit knowledge that drives business processes.

Organizational culture is the sum of values and rituals defined by rules. It is also a part of a “bigger picture” that surrounds an organization. This poses some problems if organization shock-wave through different cultures.

Four decades ago IBM tried to unify corporate culture in its subsidiaries all over the world. Geert Hofstede carried out a world-wide survey on employee values. The result was very informative and demonstrative. There were other researchers of the same topic too. A common conclusion of all those studies is that “we are definitely different”.