Leadership – Our Unhealthy Organizations

An organization’s health can determine its ability to remain competitive. Since so much of our reaction to organization’s well being is based on the relatively small time frame of a quarter of a year, we have often ignored the signs of an organization in trouble until it is too late. Unfortunately, our leaders, for the most part, are better trained in (and better rewarded for) evaluating the static financial and product information than the real health of the organization.

Studying an organization as if it were a person can yield some very interesting information.

Most of us, if asked about our health, would not think of assessing health by looking at the balance on our personal bank account.

And yet, when we talk about organizations, we make the mistake of thinking that an organization’s health is mostly reflected in its revenues, profit margins, assets, cash flow, and the immediacy of its mission.

Why is that a mistake? Those elements simply reflect a snap shot of the organization’s ability to “push off” reality if the circumstances change. The more assets an organization possesses, the longer it can pretend it is healthy.

Another Important Set of Markers for Assessing Organizational Health

The issue of organization health is one which determines the long term viability of an organization.

Consider answering the following questions about your organization.

Is your organization vital? Is the energy and enthusiasm high? Do people look forward to coming to work? Do they find it hard to imagine working anywhere else? Are they having fun?

Do not make the mistake of thinking that adrenalin is energy. A common error is for senior leadership to set a tone of frenetic work ethic. An expectation of long days, including early and late meetings evolves as a response to the modeling of leaders. The organizational result is exhausted and overworked employees.

They are worn out, burned out and overwhelmed. Such a reality is not healthy for the individual and it is not healthy for the organization. (It also ensures retention issues.) Balance and pace are more relevant to health than “work ethic” as it seems to be defined today.

Look also at the organization’s relative symptoms of well being in terms of weight gain or weight loss (symbolically, of course). If you are cutting costs, do your leaders know the difference between healthy weight loss and anorexia? Are they addicted to the reviews they get on the bottom line for cost savings?

Cost cutting in organizations can become a habit with the immediate reward of a better return or an illusion of growth. The long term return however, is a diminished organization with fewer resources, and with individuals stretched too thin to remain creative or responsive.

All health issues affect retention. Do people stay with your organization? Does their value and training continue to contribute to the long term health of the organization, or are they looking for a way out? The retention issue is a form of internal bleeding. It may not be outwardly evident, but the long terms effects are devastating.

How focused and deliberate is the organization? It is important to look at this question in the same way you would look at it if you were evaluating a person’s focus. Is there follow through? Does the impact of behaviors and decisions look like the track behind a fast moving train, or does it resemble the wake of a boat which has lost its driver?

In a human being, organs cannot fight with other organs for dominance. When they do, the outcome is ugly. Each organ has a function and must interact fluidly with the other organs for the person to stay healthy. The infighting in organizations for control or budget or position is too similar to the organs of a human being at war. The overall health will ultimately suffer.

What is the cost of just a few of these symptoms? In the short term, it may be relatively low. One can cover up the effects with clever camouflage.

In the long run, however, unhealthy organizations consistently become average. No matter how many brilliant people they have, they never seem to come up with anything brilliant. No matter how many dollars are spent, mediocrity is the result. Ultimately, when the unhealthy organization depletes the amassed resources, it fails.

The Cure: Cause and Effect

Unfortunately, the people who need to solve the issues are often the carriers of the disease. Our leaders often do not understand their own culpability and so they seek and implement costly treatment of the symptoms.

For example, they create compensation packages which ultimately become leverage in the person’s next job negotiation, rather than a true incentive for retention. They develop diversity programs to address why the women and minorities in our organizations are leaving in droves, without examining the broader issue of symptoms of an unhappy workforce.

Many organizations provide intense psychological testing devices to make absolutely sure they are hiring the “right stuff” and then wonder why their leadership teams fight amongst themselves. Many organizations accept and expect that executives welcome the calls from headhunters as if it is simply a cost of doing business.

Organizations implement forced ranking systems where only a few people can be stars, and then wonder why they can’t build an organization of stars. They find and hire the best and the brightest, and then beat the brilliance out of them with long hours, destructive competition, and a complicated and non supportive system to delivering their ideas.

Why don’t leaders see the problems as originating with them? Because telling a heart attack victim to take blood pressure medicine, even with all of the debilitating side effects, is so much easier than telling him that he has to change his life style.

No matter how many band aids they apply, unless organizations attack the real issues behind the disease at the highest level, the organization will ultimately flounder. Leaders model disruptive behaviors which have a whip lash effect throughout the organization.

If, and when, an organization can identify the direct relationships between symptoms and leadership, the question will be whether its leaders are courageous enough to attempt the cure.

What Can be Done?

Leaders must first decide what they really want. They must be willing to say it aloud as opposed to imagining that everyone sees them as diligently managing the culture. They must understand that if they are pretending to manage the health, but are totally focused on the bottom line, they are fooling no one.

 Are they creating a healthy, functional organization that is exceptional, or are they creating short term results so that they can look good?

Once the leadership actually makes a commitment to managing the organization’s health(rare in actual occurrence), they must assume that any symptom of flawed health can be traced back to leadership behavior.

They will have to stop ignoring burn out, turnover, poor ability to take ideas to completion, etc.

How to Break the Patterns

Beware of expensive, fancy cures which deal at the micro level of a problem. Assume the issues in your organization come from above and get to work on the correct problem.

Here is a small but relevant (and inexpensive) test. Observe your senior leaders and ask yourself whether they consistently act like mature, thoughtful adults who really have their acts together. Pay close attention to temper tantrums, nasty email or voice mail trails, cutthroat behavior with their peers, blame, or other evidence of fear based or selfish responses.

Note the way a leader’s new subordinates feel about working for them when power shifts occur. Identify whether your leaders are supportive or competitive with each other. If you note bad behavior, ask why it is not stopped immediately with zero tolerance. Who is afraid of whom, and what?

If your observations yield the familiar information of senior leaders at war, spend your time, money and effort on being completely dedicated to fixing that problem. All behavior that indicates a self serving, career building, addiction to power is a problem for your organization that will reflect in lack of initiative and health throughout the organization.

If you are effective in nullifying unhealthy behavior at the top, you will see immediate impact throughout the organization. It is amazing how quickly the correct cure sets things on the right path.

Keep it simple. The right answers usually are!