The Fallacy of Authority

authoritySimply put, leadership is the ability to influence others.

Ironically, however, the ability to influence others, either in an organization or in the political arena, ultimately doesn’t depend on an individual’s title or position of authority. In fact, those in positions of “authority” often confuse their ability to inflict their will on others (where authorized by their position or title) as a “right” of leadership. This is frequently the case with new managers and those whose motivation for leadership is based on a desire for authority in the form of personal control and power.

These authoritarian relationships may command respect in a superficial sense, but are void of trust and respect. They are based solely on fear rather than empowerment and personal ownership, and offer no provision for alignment of ideas or ideals. In this self-centric mindset, the emphasis on success is internal. The success of both subordinate individuals and the team is viewed by the manager as being dependent upon his or her personal success. These managers tend to believe that in order to validate their own value to the organization they must make themselves essential to the success of the team.

I see this in teams that are largely dysfunctional when the leader is absent. Decisions cannot be made without the manager’s consent. Personal ownership and accountability is stifled and autonomy is restricted. There is little or no basis of trust in the competence and discretion of the team members. This type of manager hordes power, controls rather than leads, and lacks the self confidence to allow subordinates or the entire team to excel in his absence. They make the success of their team completely dependent upon their presence and participation.

I believe that just the opposite is true of superior leaders – that the true measure of success for a leader is not how necessary he is to the team, but in fact how unnecessary he is. This might sound radical or counter-intuitive, but if a leader has truly done his job, the people who work for him should be able to function autonomously for an extended period of time without the necessity of his direct supervision. They should all be aligned both individually and collectively with the organizational vision and goals. They should each have a strong sense of personal ownership and accountability, both to their leader and to each other. They should exhibit integrity and self-discipline. They should be enthusiastic and self-motivated. And finally, they should have a balanced sense of selflessness (teamwork) and drive for personal achievement. This is the very essence of a high performing team, and the best managers and strongest leaders, in effect, actually make themselves less and less integral as their teams become more and more self-sufficient.

The ability to influence others is a powerful and awesome responsibility. Effective, superior leadership, under which individual and team performance is developed and cultivated to its highest potential, requires uncommon, illusive, and perhaps innate personal qualities.  It requires confidence and vision with a strong sense of purpose.  It requires courage, discipline, and dedication to the development of others.  It requires authority without authoritarianism.  Superior leaders nurture cooperation instead of mandating compliance.  They build consensus and create a culture of alignment in which every member shares in the ownership and accountability.

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Professional Effectiveness or Personal Fortitude?

Chances are you’ve at some point known or worked with someone who has endured a significant personal crisis.  Perhaps it was a nasty divorce, a life-threatening personal or family illness, the loss of a spouse or child, or a similar life event that turned their world upside down.

I lost my father to a heart attack just weeks after I turned 17 years old and days before I started my senior year of high school.  I can still remember the numbness I felt as I went to school that fall, surrounded by friends whose lives were blissfully unchanged while my own was irreversibly altered.  But as difficult as it was, I persevered.  It could even be argued that it was easy for me to move forward simply because I still had my entire life before me.  But I doubt I considered that at the time.  No, I persevered because there was simply nothing else I could do.  I couldn’t reverse or change what had happened.  Like it or not, I could only adapt and move on.

As bystanders – family, friends, and co-workers, we admire the strength of those who have suffered tragedy and yet are somehow able to keep going.  Because we can only imagine their grief and anxiety, we marvel at their ability to continue doing the simplest of daily activities and can hardly understand how they’re able to keep coming to work or to class.  The fact is, like me at age 17, they do it because there is simply nothing else they can do.  They adapt and move on because there is no other option.  They have no choice.  Bills still have to be paid, mouths still have to be fed – the responsibilities of life don’t stop.

It’s human nature to sympathize with people in these situations, and there is nothing wrong with that.  But I think it’s easy to confuse sympathy with admiration, and there is an important distinction between the two.  At the risk of sounding coldhearted, to admire someone who continues to live and work after a tragedy is like admiring a sailor who swims after his boat sinks.  Do we admire him for not giving up and drowning?  Do we admire his courage?  Truth be told, most of us probably do; after all, we’re inspired by stories of perseverance and love to cheer for the underdog.   But again, what choice does he have?  He can swim and live or he can sink and die – not much of a choice.  It’s a simplistic comparison, but I think it relevant nonetheless.

The point I want to make is we have such a natural inclination to admire those who overcome tragedy, we often let it cloud the rest of our judgment about the individual.  Specifically, it’s easy to confuse what we perceive as personal fortitude with the reality of professional effectiveness.  Surely we’re inclined to assess the individual’s performance more generously in light of the adversity they’ve faced, and this is certainly the right thing to do temporarily while the person heals.  After all, no one can be expected to perform at full capacity either during or in the aftermath of a personal crisis.  But that’s not what I’m talking about.  I’m referring to the tendency to allow our permanent perception of the individual to be skewed due to whatever past tragedy they’ve endured – confusing their fortitude and resilience in moving on with their ongoing effectiveness in their job.

In short, personal fortitude is ultimately no substitute for, and is indeed in this context only marginally related to, good performance.  It’s not for me to say how long a person should be allowed to recover from a crisis.  That depends on the individual, situation, and circumstances.  However, regardless of whatever tragedy the individual has suffered in the past (or even presently endures), eventually his or her performance and professional effectiveness must be judged on its merit.  We can admire their strength and perseverance, but that alone is a poor substitution for meaningful achievement.

The Restoration of Tools and Refinement of People

I have a thing for old tools.  Not the ones with cords and plugs, mind you, but old hand tools that predate electricity.  The ones guided by hand, powered by muscle, carefully honed and meticulously cared for to retain their edge and effectiveness at doing the job for which they were intended.  These are elegant, tactile tools of history, character and quality – tools upon which the livelihood of their owner depended.  These tools didn’t sit collecting dust on shelves in garages, used casually or occasionally and allowed to rust.  These were tools of journeymen and tradesmen, carpenters, cabinetmakers, shipbuilders, and carriage makers – tools that were passed down through multiple generations.  Every one has a story to tell; every paint spot, dent, ding, scratch and chip reflects a different point in time and a different job completed.

Sadly, most of these tools eventually fell victim to post-WWII modern industrialization when mass production, cheap technology, and the population explosion shifted consumer culture from quality and durability to speed and ease of use.  Today, we’ll spend $200 on a cordless drill and toss it out when the battery no longer holds a charge.  All the while, the noble tools of iron, steel, and wood that built this country sit quietly idle, rusting away in barns and workshops and garages.  Few know how to use them, fewer still know how to restore them to functional condition, and just about everyone else wonders why bother doing either.  I am one of the relative few who does both.

Opinions on the restoration of old tools vary widely and are frequently debated within their communities of interest.  I personally believe that less is more when it comes to restoration. I like the idea of retaining a tool’s character – its scars and marks from use, its patina, etc.  I believe a tool should be cleaned and maintained in the same manner as the original craftsman who owned it would have done. A hundred years ago, these tools represented the livelihood of the owner. They were relatively expensive and the woodworkers who owned them relied on them to make a living. They would not have allowed rust to accumulate and would have cleaned and oiled them regularly.

Refining people is not unlike the restoration and care of vintage tools.  Regardless of age or experience, there are always rough edges to be eased, working mechanisms in need of adjustment, and business implements to be sharpened to produce the desired result.  People in an organization require constant tuning and ongoing maintenance in order to function at their peak capacity.  Good leaders exist, not simply as masters of the tools they wield.  Rather in the manner of fine craftsmen, they are charged with refining, tuning, and honing the tools in their care, through the edification and development of the men and women they lead.

The refinement of these human tools requires a firm but gently touch.  In time, their mettle (pun intended) is reflected in a patina developed through experience, accomplishment, and occasional failure.  Skills develop through hands on instruction and are shaped by practice.  The quality of results improves as the tool is tuned to achieve the task intended.   Adjustments are made, impurities cleaned, and accomplishment is rewarded until eventually the tool attains a confidence, character, and integrity all its own.  Shavings are gossamer thin, lines are cut straight and true, and revealed in every achievement is the precision of the tool and the influence of its custodian.

Without constant care, tools become dulled by use – corrosion slowly creeps in, alignment is eventually lost, and the ability of the tool to perform as expected is compromised.  Just as the journeyman of 100 years ago was personally responsible for the care and maintenance of his tools, so are the business leaders of people today.  In a culture where tools are deemed disposable, easily replaced by a trip to the local home center, leaders of people cannot afford to be so cavalier.  These human tools represent the livelihood of the organization. They are relatively expensive and the companies that employ them rely on them to sustain and grow the business. They must not be allowed to fall idle and rust.

Five Fundamental Principles of Service Excellence

To say that customer service is virtually non-existent today would be a comical understatement.  It seems everywhere we turn the quality of service we receive is inconsistent at best, from the waiters and sales people who ignore us to business managers who view us as interruptions.  I believe the root of the problem is not so much one of employee indifference; this is merely a symptom of the problem rather than the problem itself.  The real problem is a systematic failure on the part of companies and their managers to see beyond the transaction, make decisions based on intellect verses emotion, and empower their employees to be an advocate for the customer rather than ‘defender’ of the company.

Most people, if they are at all engaged in their job, want to do well.  Likewise, all companies want to be successful, and understand the value and necessity of happy customers.  So, where is the disconnect?  I believe it’s with the middle and lower level leadership.  It’s not much of a stretch to conclude that employee attitudes toward customers are a reflection of the culture created by management within the store, restaurant, or department.  I suppose there are a myriad of reasons, everything ranging from indifference and ignorance to a misguided notion of protecting the financial bottom line.  Just last week my wife asked to speak with the general manager of our dealership over a mechanical problem with our year old car that the staff was unwilling to rectify.  His response after listening to her complaint was to accuse her of being confrontational.  It is no wonder his staff was so unhelpful.

Leaders at every level bear the responsibility for maintaining a culture of service excellence, communicating expectations, and monitoring performance.  This requires personal interaction, not only with employees, but also with the customers.  Leaders can’t lead from behind a desk or though emails.  They have to get out of their offices, spend time along side their employees and participate in constant face to face interaction.  This is why you see managers in finer restaurants stop by your table to ask if everything was okay.  They understand the value of personal attention to their staff, customers, and business.  Philip K. Wrighley, chairman of the world’s largest chewing gum company, famously relayed the following story: “I went into our New York office one day and they asked who was calling. I told them it didn’t make a bit of difference. It might be a guy wanting to buy some gum – and that’s all that mattered.”

Below I’ve attempted to summarize service excellence in five fundamental principles.  Perhaps I’ve oversimplified it, but I don’t think so.  In fact, isn’t that the point?  Superior customer service really isn’t all that complicated or expensive.  Everyone should try it.

  1. Customer service is never an ‘exception’ or an ‘accommodation’
    These two words should be removed from our vocabulary.  Meeting (not to mention exceeding) a customer’s expectations should be a matter of principle.  Make decisions with enthusiasm, not reluctance, demonstrating a spirit of genuine appreciation instead of concession.
  2. Delighting a customer is a personal opportunity to be the ‘hero’
    Be the customer’s advocate in every interaction.  Customers should see us as their personal partner, not simply a representative of the company, and certainly never an adversary.  It is our job to get to ‘yes’.  Regardless of the situation, every satisfied customer reflects a personal success, and every disappointed customer reflects a personal failure.
  3. Customer service does not cost money, it earns future business
    We get far too wrapped up in our perceived sense of what is ‘right’ or ‘just’ when making service related decisions.  Any costs incurred in delighting a customer are literally insignificant compared to the goodwill and future business we gain.  Whether or not we feel they deserve it is irrelevant.  Customer service is not a battle to be won or lost, nor is it an affront to our integrity.  Better to give in to 10 thieves than to lose one legitimate customer.
  4. The solution is always more memorable than the problem
    Problems are going to occur – products will break, deadlines will be missed, mistakes will be made.  It is how well we anticipate and resolve our customers’ problems that influences their perception of our company and their decision to give us their future business.  Never leave a customer with an unresolved problem; always initiate a solution.
  5. The customer doesn’t have to ‘be’ right for us to ‘make it right’
    It’s as simple as this… no matter who is at fault, no matter what it costs, no matter what it takes – make it right for the customer.

Building and Sustaining High Performing Sales Teams

Portrait of a High Performing Team
Almost everyone who works with others wants either to be a member of a high performing team, or to lead a high performing team.  In fact, I bet 9 out of every 10 managers I’ve ever spoken with have claimed their teams were high performing.  Yet, when asked about the performance of individual team members, these same managers invariably cite a litany of “typical” shortcomings.

While I hesitate to question the self proclaimed assessment of another manager’s team without seeing them in action for myself, I have to wonder how they came to their conclusion.  How can a high performing team be comprised of individuals with performance issues?  Can the diversity of performance strengths and capabilities within a team actually make the overall team stronger, despite certain individual weaknesses?  And how is it that these managers don’t ask themselves these same questions?

To be sure, individuals with performance problems are not high performers.  That is not to say that an employee must be perfect; indeed, everyone has strengths and weaknesses.  There is a distinction, however, between weaknesses and performance problems.  Strengths and weaknesses between team members are like pieces of a puzzle.  All the pieces must fit together to complete the picture.    In the strongest teams, members should complement each other’s strengths and weaknesses.  In fact, assembling a team in which there is diversity of strengths should be a priority.

There’s no single recipe for building a high performing team.  The variables are simply too great.  On the other hand, there are clearly common attributes that successful teams manifest, and at the same time behavioral patterns that destroy a team’s effectiveness and their capacity for achievement.

So, what does a high performing team look like?  It’s really quite simple.  While individual strengths may vary, high performing teams exhibit many (hopefully most) of the same qualities of highly effective, influential team leaders.  At the highest level…

  • They complement each other’s strengths and weaknesses.
  • They exhibit integrity and self discipline, both individually and collectively.
  • They have a balanced sense of selflessness (teamwork) and drive for personal achievement.
  • They are responsible and accountable – to their leader and each other.
  • They are enthusiastic and self-motivated.
  • They are individually and collectively aligned with the company’s vision.

Of course there are many other skills and traits that high performing teams must possess and demonstrate – effective communication, mutual trust, respect, etc., and of course they must work harmoniously together to achieve the task at hand.  Skills, however, can be taught, habits formed, and behaviors modified, while character and cultural fit are individual factors that are deeply ingrained.

High Performing Teams Begin with High Performing Individuals
Diversity, complementing strengths and skills, and achievement oriented members are all considerations when building or adding to an existing high performing team.  From a practical standpoint, assembling a high performance team begins with a thoughtful and well developed hiring process.  Recruiting often focuses on matching experience to a job specification. This is important where technical qualifications are concerned, but it will not necessarily identify people with high performance traits.  High performers are almost always high performers – wherever they work.

Who are your high performers?  According to a McKinsey & Company report on “The War for Talent,” top performing employees make a 50% to 100% greater contribution to organizations than do their less capable peers.[1] So ask yourself this, if you had to start from scratch, would you re-hire all the employees you currently have? If not, why?  If you could select from just 10% of your existing work force, who would you choose and why?

In my experience, the highest performing sales professionals demonstrate the following characteristics…

  • Achievement Oriented – Money shouldn’t be the goal, only a way of keeping score
  • Perpetually Optimistic – Doesn’t concede defeat, doesn’t accept no as an answer
  • Selling is a Lifestyle – A way of life, not just a job – they never stop selling
  • Understand Customer Motivation – People buy on emotion and excitement, not logic and reason
  • Walk in the Customers’ Shoes – Sensitive to customer’s needs vs. their own (understands difference between ability to buy and desire to buy – validates the customer’s desire)
  • Leverages the Strengths of Others – Those around them

Strategic Hiring Decisions
Research on hiring decisions reveals that people tend to hire applicants with whom they share the strongest personal connection, i.e. those with similar outlooks, mannerisms, personalities, and ideas.  Harvard Business School professor Rosabeth Kanter calls this phenomenon “homosocial reproduction.”[2] While this may be just fine in some cases, the implication is obvious in others.  As Stanford Professor Robert Sutton indelicately puts it, “…assholes will breed like rabbits.”[3]

That’s an extreme (albeit accurate) example, but practically speaking, everyone including the most effective managers has areas of weakness.  While we certainly don’t want to compound weaknesses, the inverse is also true.  To use the puzzle metaphor again, whitewashing over weaknesses by cloning strengths is like trying to put together a puzzle in which all the pieces are the same size and shape.  The strongest teams are comprised of diverse personalities with complementary skills, and they use this to their advantage.  Reduce the risk of poorly influenced hiring decisions by having several managers interview a candidate and collectively participate in the decision process.

A Framework for Success
There’s a saying, “If you don’t know where you’re going, any road will get you there.”  A comprehensive plan helps hiring managers at each decision point by giving focus and structure to the process. With the following four-step plan, not only will you have the highest probability of making good hiring decisions, you’ll also establish a framework of success for ongoing team development.

1. Recruiting and Hiring for Excellence
Leading a high performance sales team naturally begins with the people that you hire.  You simply cannot afford to settle for the best “available” applicant, you have to find the right person for the job and team.  In building a high performing team, whether staff or management, qualification criteria should be closely examined before you ever run an employment ad or interview an applicant.  Managers tend to focus heavily on education, job experience, and presence.  These are all important, but also look closely at temperament, interpersonal skills, and character.  Hire for fit within the team.  You can always train for skill (you will probably have to anyway), but trying to train for cultural fit is an uphill battle.

2. Cultivating Success

Regardless of individual successes, a sales team is only as strong as its weakest performer.  A successful high performing team depends on each member pulling his or her weight, contributing to and complementing the team, leveraging its strengths and adding value through individual performance.  Cultivating team success involves addressing deficiencies, identifying and overcoming obstacles, and gradually redefining the very meaning of success in an existing sales environment.  This may involve rooting out underperformers, holding them to a higher level of accountability, and removing them if they are unable to meet established standards.

3. Maintaining Performance Standards
Aggressive and inclusive performance development is a key component to managing and leading high performing teams.  An integral part of the performance management process, regular coaching, feedback, and performance assessment measured against peer comparison benchmarks provide exceptionally flexible and meaningful tools for quantifying and qualifying employee performance.  In situations where progressive discipline is warranted, a consistent approach using readily available performance criteria ensures a fair and actionable case for warnings and dismissal.

4. Nurturing a High Performance Culture
I previously discussed in detail creating and nurturing a Culture of Alignment.  Developing a high performing sales culture requires a considerable investment in time, but it’s not rocket science.  You have to realize, however, that any such move to alter the culture of your store and team must be carefully planned and executed.  It will not happen overnight.  In fact, it might take a few years.  But the investment is well worth the effort.


[1] Fishman, Charles. The War for Talent. Fast Company, 2007

[2] Kanter, Rosabeth. Men and Women of the Corporation. New York: Basic Books, 1977

[3] Sutton, Robert. The No Asshole Rule. New York: Business Plus, 2007

Delusional Effectiveness Disorder: Confusing Activity with Achievement

De-lu-sion-al  Ef-fec-tive-ness  Dis-or-der

Pronunciation: \di-‘lüzh-nəl\ \ĭ-fěk’tĭv-nes\ \dĭs-ôr’dər\

–noun

  1. a functional disorder characterized by systematized delusions of accomplishment and the projection of personal achievement, which are ascribed to the span and intensity of activity demonstrated, and manifested in the notable absence of meaningful results.
  2. delusions of grandeur
  3. slang: rectal-cranial inversion

Mission AccomplishedWe’ve all seen them.  Companies and organizations around the country are full of them.  You know who I’m talking about – you have a few in your organization right now.  I’m referring to those people who make the most noise, ask the most questions, make the most suggestions, send the most email – unrepentant self-promoters who frantically wave their banner to demonstrate to the world how busy and important they are and how tirelessly they work.  They make a big fuss and put on a great show, but actually accomplish very little.  In short, these are folks who confuse activity with achievement.

I refer to this common malady as Delusional Effectiveness Disorder.  While its origins are unknown, the presence of this condition has been noted among several business, military, and political leaders throughout history, including recent presidents.  The manifestation is essentially the same in all those infected.  Somewhere along the way in their careers, folks with DED have fallen under the illusion that recognition and advancement is the reward of working hard.  Indeed, working hard is important, but is only a meaningless shell if the effort fails to yield fruit.  (For the sake of argument I’m using “hard work” and “working hard” interchangeably and in the same context.)  To be sure, hard work is to be admired, but not simply for its own sake.  By contrast, smart work resulting in meaningful accomplishment is far more impressive. Success is the product of accomplishment, not merely the result of working hard.

Hard vs. Smart – Consider the response of the bar soap manufacturer when it discovered approximately one in every thousand of its boxes left the plant empty, resulting in numerous customer complaints.  Their team sprang to action, their best engineers were assembled, the equipment manufacturer was consulted, an extensive quality control study compiled, and a detailed plan to re-design their assembly line proposed – all at a substantial cost in time, labor, and materials.  Thankfully, a low level staffer quietly suggested that they simply set up a large fan at the end of the production line.  The empty boxes, he reasoned, were substantially lighter than those containing the bars of soap, and would therefore easily blow off the conveyor.

Or… When NASA began to launch astronauts into space, they discovered that their pens wouldn’t work in zero gravity. To solve this problem, they spent one decade and $12 million.  They developed a pen that worked at zero gravity, upside down, underwater, on practically any surface including crystal and in temperatures ranging from below freezing to over 300 degrees C.

And what did the Russians do?  They used a pencil.

PelosiNow to be fair, many who are burdened with Delusional Effectiveness Disorder are fevered with the most benevolent of intentions.  In such benign cases, this unfortunate affliction is indicated by a distinct absence of malice often complicated by limited mental acuity, where genuine enthusiasm, however misguided, reflects a sincere attempt to boldly demonstrate that something (i.e., anything) is being done. The problem is that typically the “something” involves a flurry of activity that, while perhaps appearing impressive on the surface, contributes little in the way of substantive results.  It’s activity for the sake of activity with a focus on action rather than the accomplishment.  This reminds me of the adage we jokingly followed in business school when preparing case presentations: “If you can’t make it good, at least make it pretty.”  Form over substance.

Sadly, however, Delusional Effectiveness Disorder is more often manifested in those primarily interested in self promotion rather than misguided enthusiasm.  These individuals are convinced that advancement will be rewarded to those demonstrating a maelstrom of activity (they’ll call it initiative).  They are masters of deception, flawlessly executing their political song and dance.  Their objective is the glorification of process – their process – rather than a measure of true accomplishment.  But what is value of initiative in the absence of achievement?  Ironically, if these people worked half as hard at actually accomplishing something as they do demonstrating how busy they are, how hard they work, and how important they are to the organization, they might truly achieve great success.  And in what is perhaps the greatest tragedy of all, managers in many organizations fall under the spell of this thinly veiled farce, enabling and encouraging DED induced behavior by celebrating “initiative” rather than meaningful achievement or contribution.  While the desire to recognize such initiative is presumably well intended, the effect of poisoning the morale of those with greater substance is nevertheless profound.

What are we to do?  Entire books have been dedicated to managing strategically in a highly politicized environment.  Capable, effective leaders with a well defined vision of success find no distraction by subordinates infected with DED.  They recognize that substance presents itself in many forms, sometimes very subtle, and they reward achievement.  They coach through behaviors that are unproductive to the individual, team, and organization, and re-focus efforts to the attainment of broader objectives.

Fortunately, Delusional Effectiveness Disorder is not usually contagious.  In fact, those infected are typically held in leprotic contempt and shunned by peers.  While superiors often swoon with a temporary sense of euphoria, the effect wears off as time and transparency take their toll.

Championing Change After Restructuring & Layoffs

I. Employee Reaction and Response

The Emotional Response to Restructuring
Let’s face it, corporate downsizing and restructuring is stressful on everyone involved, and the effects are registered on both those who remain employed as well as those who leave the company.  It’s ironic that companies frequently refer to staff members who retain their jobs as “unaffected” or “untouched” by the layoffs.  The fact is employees who remain employed after restructuring are far from unaffected.  They experience numerous and wide-ranging feelings of distress during and following periods of significant change.  Typical reactions include fear, grief, depression, resentment, diminished energy and motivation, difficulty concentrating, and even symptoms of physical illness.  These reactions are normal, but if left unaddressed can easily degrade short-term productivity and leave long-term scars that affect both individual and team performance.

People are not so much resistant to change per se, but rather have difficulty coping with change, particularly when it is totally out of their control.  This response is probably felt even more acutely in teams that normally enjoy a strong sense of alignment – where the culture is normally one of active involvement and participation in the change process.  Employees and teams with a strong sense of personal ownership and attachment to the company often feel a stronger sense of betrayal.  In these teams, re-establishing a sense of security and purpose after restructuring can be a challenging prospect requiring a thoughtful plan of action.

A 2006 study published in the Academy of Management Journal found that layoffs have the most negative effects on subsequent performance in what they identified to be “high involvement” workplaces. These are workplaces where employees have more decision-making authority and responsibility and greater emphasis is placed on the importance of human beings compared to traditional workplaces. As the study concludes, when members of an organization have been treated especially humanely, given substantial authority, and persistently told how much they are valued, layoffs violate the “psychological contract” between the organization and its people.

By contrast, organizations that have a history of treating employees in less humane ways and giving them less power, and then do involuntary layoffs, aren’t breaking any implicit or explicit psychological contract – employees don’t have as much reason to believe that such treatment is breaking any promises.

This may all sound like evidence that “no good deed goes unpunished.”  But the study did find that high involvement companies that stuck to their practices during downsizing rebounded more quickly than those companies that abandoned high involvement practices after implementing layoffs.[1]

On some level, everyone’s personal identity is tied to the company they work for, the position they hold, and the job they do.  Well aligned team members enjoy exceptionally deep attachments to their peers, their company, even their team culture.  When something disturbs the cultural foundation of the team (such as restructuring or layoffs), those who remain naturally go through an adjustment period.

Leaders have both a responsibility and opportunity here – the responsibility to make the transition as painless as possible, and the opportunity to strengthen the team and take it to new levels of effectiveness and success.

Effects of Transitioning Roles and Responsibilities
Following an organizational restructuring, daily routines are disrupted.  Some responsibilities are redefined, others are left untouched, and still others are completely orphaned and must be absorbed into existing roles.  Even well planned reorganizations can leave employees feeling a bit disoriented and overwhelmed during and following the transition.

We all have different internal mechanisms for coping with change, yet some are more productive than others.  I think it’s instinctual for people to want to get through the process and re-establish a new sense of personal order and routine – to “get back to normal” as quickly as possible.  However, the path through the transition can be bumpy with obstructions that will derail the effort if not monitored and managed effectively.

While some employees need to openly share their feelings about the changes confronting them, others completely withdraw into silence.  Some employees spend an inordinate amount of time talking about the changes to anyone who will listen.  Again, it’s important to remember that this is part of their healing process and necessary for them to move on.  At the same time, their energy should be directed appropriately (and constructively) so as not to unduly distract or undermine the healing of others.  Similarly, the needs of those who withdraw should also be respected, but they should never be abandoned.

Some people have difficulty accepting and adapting to new roles and responsibilities while others see the changes as a new career opportunity.  The simple fact is that some people, even high performers, are averse to change.  Change shakes them out of their groove and serves as a distraction.  Certain changes, in fact, may legitimately inhibit their ability to successfully perform at the level to which they are accustomed, at least temporarily.

It’s also worth considering that some employees have extended personal support groups outside of work while others have little or none.  Someone well established with a spouse, children, parents and other family members as well as a large group of friends may cope differently than a single person alone in the area.  Additionally, the jobs of some employees are simply more affected than others.

There are numerous factors that impact the degree to which change is felt and the ability of each individual and teams collectively to cope.  People respond differently to stressful situations and organizational upheaval.  To bring a team through the changes and re-establish a sense of common vision and purpose, it’s essential for leaders to plan strategically and implement situationally.

II. Recognizing & Responding to Organizational Change – A Leader’s Guide

Understanding the emotional effects of organizational restructuring on employees and the various ways people cope with change is obviously important.  Using this knowledge to help a team transition is crucial, certainly for its immediate short-term benefits, but more importantly, for the long-term efficacy of the team as a high performing entity.

Faced with circumstances which are at least for the moment out of their control, employees look to their leaders for guidance and reassurance (even when none exists).  These are times when the mettle of leadership is put to the test, when credibility and trust is either reaffirmed or destroyed.  Leaders have a tremendous opportunity to re-define the vision and sense of purpose of the team, introduce new objectives, strengthen alliances, and re-establish a culture of organizational alignment committed to the future, all in a relatively short period of time.

Make no mistake, during times of crisis, leaders are closely watched and their character and efficacy assessed. Everyone from subordinates to co-workers and even superiors look for and depend upon effective leadership.  Decisive, courageous, visionary leadership laced with empathy and sensitivity goes a long way toward re-establishing trust and re-building confidence, and helps assure that desired employee engagement and productivity levels are maintained through the change process.

Weakened teams cannot effectively heal under a “business as usual” approach.  There are numerous efforts that leaders should undertake to mitigate both the emotional and practical impact of restructuring on morale and productivity while championing the change initiative:

Treat Everyone With Dignity and Respect
This may sound like an obvious no-brainer, but at a minimum, everyone deserves to be treated with dignity and respect.  Those being laid off, or for that matter those who are terminated for performance issues throughout the year should always be treated with dignity and empathy.  Again, the rest of the team is always watching.  The co-workers of an ousted employee may very well have a very different relationship (and perception) of the individual than does management.  The manner in which terminated employees are treated can have a considerable impact on the morale of the team, and influence their view of the company and their personal sense of value.

Rebuild Trust
The fact is, in the wake of early retirements, layoffs, and restructuring, trust is weakened.  Despite the sensitivity with which changes are implemented, it is weakened due to the emotional response to circumstances beyond the employees’ control, and a perceived violation of the psychological contract and sense of security that management typically works so hard to establish.  Think about it… companies go out of their way to foster a sense of family and teamwork.  Senior management refers to it in global communications; we build it locally through departmental celebrations, holiday dinners, and team picnics; we even celebrate important milestones in employees’ personal lives.  We do all of these things and more to impart a sense of cultural connection, and to nurture relationships with our employees and their families.  Restructuring undermines this sense of security, belonging, and personal value.

Of course intellectually, everyone understands that sustaining the viability of the business entity is the highest priority, but it doesn’t diminish the feelings of betrayal when changes in the form of layoffs and reductions in force become necessary.  The loss of a co-worker and team-mate is painful, regardless of how fiscally prudent it might be.  Those who survive the reduction still suffer a range of emotions despite the legitimacy of the business need.  Their sense of confidence and security is understandably compromised.

The key to rebuilding trust is demonstrating a strong sense of integrity and equitability.  Integrity is built on honesty and the consistent, steadfast adherence to established principles and standards.  Trust itself is a product of character and integrity, and part of the foundation on which effective leadership is built.  Further, trust cannot be reestablished without demonstrating sensitivity to the needs of others.  Everyone needs encouragement and reinforcement when they struggle.  Leaders who are strong of character neither delight in, nor are they complacent with, the struggle of others; they are personally burdened by it.

Be Visible and Be Involved
Employees are not the only ones who are affected by restructuring.  Leaders are personally affected as well.  In the immediate aftermath when responsibilities need to be delegated, job descriptions re-written, and plans for the future redesigned, it’s easy to get caught up in the tasks that must be accomplished at a time when employees need their leaders for stability and guidance.  It’s tempting to put managerial tasks first, but doing so invariably sequesters leaders away in meetings and on conference calls behind closed doors, physically and psychologically separating them from the staff just when they are most needed.

Although they might not ever admit it, employees like having their leaders visible and accessible.  Particularly during times of high stress, it’s reassuring for them to be able to interact with their managers.  It’s really not unlike the relationship that parents have with children.  There is comfort in knowing our leaders are close by and available.  All the closed door meetings and phone calls send the message that there are more unknowns, more changes to yet to come.  It’s bound to be unsettling, even to the most secure staff member.

There is also tremendous practical value to being visible and involved.  It affords the opportunity for a leader to listen, respond, empathize constructively, address concerns, and dispel rumors.  This time can and should be used to re-emphasize goals and vision for the team and company, laying the cultural groundwork for future alignment.  It also provides an opportunity for leaders to publicly show appreciation for dedication, resilience, initiative, and achievements during the transition period.

Communicate Constantly and Honestly
Lack of timely and open communication is perhaps the single most significant contributing factor to the erosion of employee trust and confidence.  Fear of the unknown is a powerful and destructive force.  Left unchecked, it fosters speculation, becomes a breeding ground for gossip and rumors, and grows into a distraction that overwhelms productivity, bringing the business at hand to a crawl.

I don’t know of anyone who would rather not know what’s happening behind closed doors.  And while answers are often slow coming to light, people appreciate consistent communication even if it’s for no other purpose than to offer reassurance or empathy.  Even when there is no new news, a staff meeting can serve as an opportunity to honestly explain the current state of affairs, describe the planning process taking place, focus on new objectives being designed, or simply discuss and respond to concerns.

Key to maintaining credibility and trust is to be as honest as possible.  As is appropriate, state what you know, concede what you don’t, and be truthful in all things.  Keep staff members engaged in the process and focused on the future of the team and company.  This is not the time to B.S. – be honest and genuine and give it to them straight.  Don’t sugar-coat the facts.  They may not like the message, but they’ll respect (and trust) the messenger.

In the aftermath of restructuring, keep talking.  Make sure everyone knows what prompted the changes, what alternatives were considered, and how conclusions were ultimately reached.  This message needs to reflect a rational decision process with consideration for all subsequent effects (on both the people and the business), and focus on the positive outlook for the future of the company.  Again, the message needs to be repeated over and over to rebuild the confidence and sense of personal security of the employees.

Reaffirm Personal Value and Contribution
In a recent team meeting following our own organizational realignment, I asked everyone present to take a moment and look around the room at their co-workers assembled.  I acknowledged that while some of our friends were no longer with us, this was the team that represented the future of our business.  I confirmed that the changes before us would necessitate flexibility and adaptability, and I asked for their patience as roles evolved and responsibilities shifted.  I reminded them of our strength as a team and the exciting opportunities afforded us to reshape our business and relationships, both with each other and our customers.

Ironically, the period just following a restructuring is when the absolute best is needed from remaining employees, yet this is the very time when they are most distracted and least inclined to give 100 percent.  Just about everyone’s sense of safety is compromised to some extent.  Employees are emotionally detached and motivation to put forth discretionary effort diminished.  The sense of job security is low, uncertainty over roles and responsibilities pervades, and even future reporting structure is often up in the air.

It’s important to provide a renewed sense of purpose – to specifically remind everyone just how valuable they are to the company and team, to detail what their role will be moving forward, and to engage them in the process of establishing new goals.  Focus on the new opportunities that the change presents rather than simply assigning the additional responsibilities that will be required.  The objective should be to involve them in the process and make everyone feel valuable and appreciated rather than victims of circumstance.

Create New Opportunities
Most people prefer to live and work within their zone of comfort.  Even the most ambitious people would, given the choice, prefer to adapt to change on their own terms.  Organizational change forces people to step outside of their box.  Some respond with enthusiasm over the chance to learn new skills or take on more responsibility, while others fret over the additional burden or worry that they may not be able to meet the new demands.

Smart leaders use this time of transition to meet with employees to discuss career development, identify individual goals, and develop a plan of action to take them to the next level.  It’s an excellent opportunity to reaffirm the value of the employee’s contribution, outline opportunities for growth, and personally engage them in the change process.

Champion the Vision, Values and Goals
Fundamentally, any organizational restructuring reflects the necessity for immediate and drastic change.  Despite attempts to the moderate the impact, company culture takes a hit on some level.  Priorities shift, even if only temporarily, and everyone’s sense of the future is suddenly diminished.  Individual separation, changes to team dynamics, shifting responsibilities, even changes to schedules disrupt the status quo.

As discussed earlier, teams with even the strongest culture of alignment are shocked by the reality of present and pressing business needs.  The team’s sense of purpose and direction must be reset, trust re-established, and sense of security reaffirmed.  People in these situations will generally rally around a common sense of purpose, and it’s up to the leader to define that purpose.

Again, this affords the leader an opportunity to spend time meeting with both individuals and teams to re-establish the vision of the company, values of the team, and goals for achieving success.  People are naturally inclined to seek comfort in the familiar.  An emphasis on building upon existing cultural strengths provides reassurance while establishing a foundation on which to build new goals for the future.  By providing a context for the team and its members to successfully implement the company’s plan for the future, and detailing each individual’s role in the process, cultural alignment and personal engagement can begin to restore.

Leverage Competitive Advantage
Winston Churchill once said, “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.”  Opportunities always exist.  The challenge is often in knowing where to look, and more importantly, how to take advantage of them once identified.  Leveraging existing competitive advantages provides an opportunity to reaffirm a common vision and focus team efforts on the positive strengths of the organization.

Building upon and focusing on existing strengths should not be anything new to the team.  If anything, these are likely to be concepts with which employees are both familiar and comfortable.  These typically represent a source of pride for the team and can be used as unifiers in rebuilding confidence and a positive outlook.  Examples include:

  • Talent and Ability of Team Members
  • Industry Experience
  • Brand Strength
  • Client Relationships
  • Quality of Products and Services
  • Design Quality and Exclusivity
  • Breadth and/or depth of Products and Services

Additional Steps
The following are just a few additional steps that leaders can undertake to rebuild team unity and restore a culture of alignment.

  • Enthusiastically reinforce the vision every single day.
  • Focus on achieving daily and weekly goals together, keeping everyone involved and engaged.
  • Provide rewards and recognition whenever appropriate.
  • Continue existing traditions and activities that the staff is used to enjoying.
  • Initiate team activities and new traditions such as periodic pot-luck lunches, team movie nights, afternoon ice cream “socials,” awards for attendance, service and contribution, or get the team involved in a philanthropic activity
  • Accentuate the positive, eliminate the negative, latch on to the affirmative, and don’t mess with mister in-between!

Finally, it’s important for leaders to accept and share in the grieving process after layoffs.  Employees need to see for themselves that their leaders share their pain and care about the effects of change.  However, while they appreciate empathy, they also look to their leaders for strength and direction.   Superior leaders always focus on objectives, not obstacles.  They are optimistic, enthusiastic, and inspire people to become better than they might on their own.  On the heels of a corporate restructuring, these leaders provide a clear vision of the successful future, leveraging both the strengths of the business and unique talents of the individuals who provide a face to the public.

III. Preparing for Future Changes

Mitigating Risk of Additional Turmoil
High involvement teams that normally enjoy a strong sense of cultural alignment, where employees enjoy more decision-making authority and responsibility and are involved and participate in the change process, are generally able to rebound quickly when continually engaged throughout the restructuring process.  While not immune to the emotional turmoil that accompanies significant change, they are better equipped to weather the storm long term than teams with lower cultural alignment.

Most of the same techniques leaders use to lead teams through the wake of restructuring should also dampen the impact of any subsequent layoffs or downsizings that become necessary.  The benefits are essentially the same.  Leaders should continually:

  • Build Trust
  • Be Visible and Be Involved
  • Communicate Constantly and Honestly
  • Value the Team and Members
  • Create New Opportunities
  • Champion the Vision, Values and Goals
  • Leverage Competitive Advantages
  • Continue to Promote a Sense of Team

[1] Sutton, Robert. The Last Word on Layoffs: Evidence on Costs and Implementation Practices. Harvard Business Publishing, 2007