| FROM OUR EXPERIENCE |
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| Is this crisis period an opportunity for improving management processes in an entrepreneurial company? |
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I started writing this article when this idea first popped into my head: "Adversity doesn't
build character, it reveals it."
These times of recession, difficult and stormy, are testing the way we succeeded when good times were around: whether as entrepreneurs or employees! Everything we have accomplished up till now is being turned on all sides, thrown from side to side, shaken and put under intense scrutiny! This period we are going through reminds us what's important at a personal level, reveals our character and personal values more easily, forces us to decide, at a much faster pace, how we want our future to look like!
There are a lot of Romanian entrepreneurial companies that have had tremendous success until now! Whether they have expanded massively at a national level, or transformed themselves into money making machines, or have a high market share, or were sold for a lot of money - these companies have brought rapid, even slightly unexpected, prosperity to entrepreneurs and stock holders.
With this success, companies started to "fatten", to live a life of "excess", "negligence" and "carelessness", they became "greedy": few entrepreneurs were interested in protecting and promoting the sound values they believed in when they first began their business, or building strong management mechanisms that educate and help the company mature in accordance with these values, build and solidify character!
The bad news - a lot of entrepreneurs, owners of variously sized companies, feel like they are in front of an execution squad, lacking the defense that should have been provided by their company, they feel betrayed by their employees, due to their lack of active involvement in making the company work or capitalizing on business opportunities! Slogans and catchphrases such as "our company", "our common goal" or "we are all a team", that seemed to have been embraced by employees in the past - now seem out of this world and have been quickly forgotten! And there is nothing inconsistent about it - this is the effect of the leadership style that has been in place up till now!
The good news - this period represents the first opportunity entrepreneurs and management teams have had to reflect and learn management lessons, in the thick of it so to speak! There is no better occasion to understand the company's character and values! A very important step in making it more adaptable and flexible, with sustainable and effective business systems, as well as healthy management processes!
David Rothkopf, known worldwide due to his book entitled "Superclass: The Global Power Elite and the World They Are Making" wrote that: "Character is more crucial now than ever, because in times of great uncertainty past performance is no indicator of future performance. Experience falls away and all you're
left with is character."
Based on the observations stated above, I wanted to find out how others around me see these things: the same or differently? "Is this crisis period an opportunity for improving management processes in an entrepreneurial company?" was the question I addressed to some battle hardened generals of management: Adrian Stanciu, Managing
Partner, Human Synergistics Romania; Chris Nel, Tom Peters Company
UK, Consultant, Facilitator; Silviu Hotaran, General Manager,
GKTI Semper Human, member of Gustav Kaeser Training International. I worked with them on several projects (all apart from Silviu whom I just met recently), they have a strong, challenging and essentially entrepreneurial spirit, and they have led or are leading both small and big enterprises, possessing a point of view that is worth listening to.
A rational plea
Adrian Stanciu, Managing Partner, Human Synergistics Romania,
http://www.humansynergistics.ro
No matter how close I am to the subject of management by values and constructive organizational values it's clear to me that none of my clients, businessmen, won't care that much if they aren't convinced they will obtain economic results. There is still a strong perception that an aggressive attitude as well as a command and control system is productive and effective. None of the people who believe this can come up with any arguments except a few examples here and there, mostly taken out of context. However, there are a lot of studies that prove otherwise, like the one we conducted last year regarding culture in Romanian organizations. Despite all this, the message still hasn't been heard.
Benjamin Disraeli said there are three types of lies: regular, brash and statistics. So I'll try something that I know is easier to accept than statistics...inductive reasoning.
The management model with which we operate today was developed by Henri Fayol. A French engineer that postulated the principles of management at the end of the 19th century. His management model, based on a series of axioms, is still applied today: anticipation - planning - coordination - command - control. The most important of them all is the fact that the future is predictable and you can plan for it, this being one of the cornerstones of management. Millions of people spend millions of hours trying to foresee and plan for the future. But what do you do when the future is no longer predictable?
To crown it all the future hasn't been predictable for a long time, but like a headless body, we continued to repeat the same old habits, even when reality was very explicit. However reality's revenge has been tenfold. With all this in mind, this reflex is so strong that were it to disappear managers would be completely paralyzed. All their competence can now be doubted, what is a manager to do if the future is unpredictable? So, despite the status-quo, he still does what he knows. "I'll be damned - a friend of mine said- I'm at my fourth business plan and it's only February". Maybe it's time to retire Fayol to the history books and accept the fact that his management model has run its course.
But, if we can't plan, what are we going to do? What will we rely on? It's a question that kept me up at night. The answer was given by another client, when talking about their strategic perspectives, "the only thing we know for sure is that we don't know anything for sure". That hit me. Because the safety of uncertainty is, strangely, a certainty none the less. If uncertainty is the only thing we know for sure, what can we do?
The answer is simple, clear and elegant. We have to move from business strategy to organizational strategy. We need flexible organizations that, like a ship in stormy weather, know their mission (destination) but are willing to change course depending on the strength and direction of the wind. In order for this to be possible all people must understand and adhere to the company's strategic intentions and values. Obviously these have to be coherent, clear and well articulated. They must have the freedom and authority to take decisions independently, in order to have a quick reaction to any stimuli. Rules and processes must exist, but they have to be immediately questioned at the first sign that they aren't serving the goal anymore. Like the legendary red button on the Toyota assembly line, any man must shout when he sees the emperor has no clothes and he must be listened to. People must cooperate, care about each other and the common goal. Every person must be respected and valued in order for them to be motivated when it comes to showing effort and energy for the common goal. Get rid of the tykes, even if they bring results, support and encourage values without exception, so that people feel involved.
All these seem out of this world, but they aren't. There are organizations that work like this. Even in our country. They are doing fine and the crisis isn't affecting them. We call them constructive organizations and building one, something to strive for last year, is now a must.
Silviu Hotaran, General Manager, GKTI Semper Human, member of Gustav Kaeser Training International,
http://www.gustavkaeser.com/www/start/index.php
My answer to Viorel's questions is YES. The problem is for whom? There are many who say that this crisis has an important moral dimension. Do you think it's possible for those that didn't understand much from the success they had when times were good, who didn't have much in terms of character and values (here I quote Viorel), who weren't moral, will see an opportunity in what's going on today? Do you think that they will develop a character and suddenly become moral? Such a change, though possible, is a radical one and demands a lot of time. This crisis is a pressure factor which offers little in terms of time.
On the other hand those who prepared during the good times, not for a crisis situation per se, building on a solid foundation, should now see the opportunity to set themselves apart from the pack. What is this foundation? Simply put, it's attitude. The way you see yourself and others (clients, partners, colleagues), your job, company, products and services. What kind of attitude? There are many possibilities: positive or negative, optimistic or pessimistic, proactive or reactive. It is on this foundation, built over time, where a person's character is formed followed by that of the organization. It is here where we find values and real culture, regardless of the grandiose mottos that appear when things are going fine.
When your foundation is solid and healthy (obviously you can find solid yet lop-sided foundations), character won't necessarily panic under pressure. Contrariwise, chances are that its natural agility will go into high gear and start searching for opportunities. In such cases you can end up strengthening company character.
Lately I had the chance to talk to a lot of managers. I noticed, as was expected, different types of reactions and attitudes regarding the crisis. Many are on the defensive, searching for those that are guilty, they complain about employee attitude and behavior and they are even on the hunt for reasons to let them go. The fight for survival is starting to become very dramatic. Organizational culture, the light one used when times are good, is suddenly replaced with one where fear (of losing one's job) is the main motivational factor.
I have met other situations. A manager told me: "I finally have the opportunity to develop a stable and efficient team. I think it's time to develop a long term strategy to develop my employees and team." Others said they are willing to give up a large part of their profit, or even their entire profit, in order to keep and develop the human quality within the company."I want to be prepared when the crisis will end" was the main argument brought forward. Which one of the examples above do you think will come out of this crisis with its character strengthened?
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Human Invest is a Premier League company in the arena of training and organizational development consultancy services, present on the Romanian market since 1998.
We are recognized for conceiving and implementing programs which offer managers an authentic experience towards improving their leadership performances, and thus we support companies in becoming more and more engaged in delivering excellent services for their clients.
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