Why Good Management is so Difficult – LBS Professor Julian Birkinshaw

Copyright Julian Birkinshaw 2011

Uncommon Sense Why Good Management is So Difficult

Professor Julian Birkinshaw London Business School

& The Management Lab

Alumni Reunion, May 2012


Quick Quiz: To what extent does your current boss…

1. …seek growth for growth’s sake?

2. …pursue ‘pet’ projects he/she is interested in, regardless of

whether they fit with the organisation’s goals?

3. …become visibly angry at work when relatively small mistakes

are made?

4. …get overly involved in the details of all the projects he/she is

responsible for?

5. …seek out recognition and plaudits for what he/she has

achieved?

6. …try to take credit for the good work of others?

7. …organise things for his/her own convenience, rather than

taking care of the needs and interests of others?

Answer on a 1-5 scale: 1=not at all, 2=not really, 3=neutral, 4=to some extent, 5=to a very great extent


A Puzzle

If something doesn’t work very well

And a (proven) better alternative exists…

Surely we would expect everyone to gravitate

towards that alternative?


Overall employee engagement levels

are depressingly low

0

20

40

60

80

Highly Engaged Moderately Engaged Disengaged

Data: Towers Perrin/Towers Watson


Who are you happiest with?

Friends

Parents/relatives

Spouse

My children

Co-workers

Clients/customers

Alone

Boss

3.3

3.0

2.8

2.7

2.6

2.4

2.2

2.0 (Rating is on a 1-5 scale)


Cynicism about the quality of

management in UK companies is rife


Companies that put their employees

first appear to do very well


Companies that put their employees first

are more profitable

• “Based on 7,939 business units, Positive relationships were

found between employee satisfaction/engagement and business

outcomes including profit” (Harter et al, 2002)

• Companies on the “100 Best Companies to Work For” list

enjoy positive workforce attitudes and performance advantages

over the broad market” (Fulmer et al, 2003)

• “A value-weighted portfolio of the 100 Best Companies earned

an annual alpha of 3.5% from 1984 to 2009” (Edmans, 2011)

This is not a new story!


Resolving the puzzle – from two

different directions

A top-down perspective

(rethinking the “system” of management)

A bottom-up perspective

(rethinking the “role” of management)


Rethinking the System of Management

Business Model

Choices an organisation

make about:

• Sources of revenue

• Cost structure

• What to make / buy

• How to make a profit

Management Model

Choices firms make

about:

• Coordinating activities

• Making decisions

• Motivating employees

• Defining objectives


Defining Objectives

Motivating People

Making Decisions

A Framework for reinventing

management

Emergence Bureaucracy

Collective Wisdom Hierarchy

Intrinsic Extrinsic

Obliquity Alignment

Coordinating Activities

Traditional Principles Alternative Principles


Obliquity

Goals are best achieved indirectly

If you want to get to point A, aim at point B

Don't aim at success — the more you aim at it and make it a target, the

more you are going to miss it. For success, like happiness, cannot be pursued;

it must ensue, and it only does so as the unintended side effect of one's

personal dedication to a cause greater than oneself.

Viktor Frankl, Holocaust Survivor and Philosopher


How do people think management will

change over the next five years?

Bureaucracy Emergence

Hierarchy Collective Wisdom

Extrinsic Intrinsic

Alignment Obliquity

1 2 3 4

Our Management

Model today

Our Management

Model in 5 years


Resolving the puzzle – from two

different directions

A top-down perspective

(rethinking the “system” of management)

A bottom-up perspective

(rethinking the “role” of management)


Two different ways of thinking about

management

What do we want to

get done?

How do we need to

act to get our

employees to do it?

What hopes, aspirations,

fears, concerns do

employees experience

at work?

How should we act to

harness their latent

enthusiasm and skill?


The current research: Enabling our

employees to do their best work

Part 1

• What makes my work motivating and

fulfilling?

• What are my fears, concerns and

frustrations in the workplace?


Respondents are worried about lack of

opportunities, and failing to deliver

Lack of opportunities for advancement

Fear of failing to deliver to expectations

Lack of clarity about organisation vision

Lack of resources for getting work done

Incompetence/negative attitudes at work

Lack of fit with organisation’s values

Fear of looking foolish with colleagues

Excessive change/turbulence in workplace

3.3

3.3

2.8

2.8

2.8

2.8

2.6

2.6 (Rating is on a 1-5 scale)


A hierarchy of employee’s

“fears, concerns and frustrations”

Physiological needs

Safety, security of employment

Belonging, love, friendship

Esteem, achievement, respect

Self-actualisation

Lack of opportunities for personal development

Fear of failing to deliver on (high) expectations Concern with the stress of the work Frustration with ineffective processes

Concern about not fitting in

Concern with uncertainty and change Fear of redundancy

Maslow’s Hierarchy Employee fears and concerns


The current research

Part 2

• What are the characteristics of a good

boss and a bad boss?

• What are the specific things he or she

does that enable me (or not) do my best

work?


The Seven Deadly Sins of Management

• Envy

• Greed

• Gluttony

• Lust

• Pride

• Sloth

• Wrath


Setting

Goals

Monitoring

Performance

Reviewing

Results

Making

adjustments

GREED

LUST


Goal Setting Sins

• Greed – Empire building, growth

for growth’s sake, overseeing

rather than adding value

• Lust – desire to pursue pet

projects for their own sake,

rather than to further the

organisation’s goals


Setting

Goals

Monitoring

Performance

Reviewing

results

Making

adjustments

GREED

LUST

GLUTTONY

WRATH


Monitoring Sins

• Wrath – blowing up at the

slightest error, being an asshole,

poisoning the culture

• Gluttony – taking too much on,

stealing others decisions, not

delegating


Setting

Goals

Monitoring

Performance

Reviewing

results

Making

adjustments

GREED

LUST

GLUTTONY WRATH

PRIDE ENVY


Reviewing Sins

• Pride – hubris, believing your

own hype, not admitting your

mistakes

• Envy – not recognising the

achievements of others, trying

to take credit for their work


Setting

Goals

Monitoring

Performance

Reviewing

results

Making

adjustments

GREED

LUST

SLOTH

ENVY PRIDE

GLUTTONY WRATH


Adjustment Sins

• Sloth – not caring about

others, inattentive, more

concerned for your own

comforts than those of

others, abrogation of

responsibilities


Quick Quiz: To what extent does your current boss…

1. GREED…seek growth for growth’s sake?

2. LUST…pursue ‘pet’ projects he/she is interested in, regardless

of whether they fit with the organisation’s goals?

3. WRATH…become visibly angry at work when relatively small

mistakes are made?

4. GLUTTONY…get heavily involved in the details of all the

projects he/she is responsible for?

5. PRIDE…seek out recognition and plaudits for what he/she has

achieved?

6. ENVY…try to take credit for the good work of others?

7. SLOTH…organise things for his/her own convenience, rather

than taking care of the needs and interests of others?

Answer on a 1-5 scale: 1=not at all, 2=not really, 3=neutral, 4=to some extent, 5=to a very great extent


In summary…

What employees need

• Give your people

important work to do

• Provide them with

space

• Provide support when

it is needed

• Given people

recognition & praise

What they often get

• Confusing or unclear

objectives

• Micro-management and

meddling

• Lack of information, lack

of concern

• Limited or no feedback


Google’s Rules for Good Management

1. Be a good coach

2. Empower your team and don't micromanage

3. Express interest in team members' success and personal well-being

4. Don't be a sissy: Be productive and results-oriented

5. Be a good communicator and listen to your team

6. Help your employees with career development

7. Have a clear vision and strategy for the team

8. Have key technical skills so you can help advise the team.

(Google’s Quest to Build a Better Boss, Adam Bryant, New York Times, March 12th)


Why is there such an enormous gulf

between the rhetoric and the reality?

1. Managing well is harder than it seems

2. Competing priorities and limited time

3. Good management requires non-intuitive

behaviour


So how can we improve the quality of

management in our companies?

Learn how to

see the world

through the

eyes of our

employees


Marketing

1. Get to know your

customers properly

2. Deliver on the

customer

experience

3. Turn your

customers into

promoters

1. Get to know your

employees properly

2. Deliver on the

employee

experience

3. Turn your

employees into

promoters

Management


1. Get to know your employees properly


Cutting through the hierarchy: How do

you get closer to the front line?

• Skip-level meetings

• Web-enabled chat and discussion forums

• Front-line work

• “Smokers corner”

• Reverse mentoring


2. Deliver on the employee experience

• Give the “service” mentality

some teeth

– HCL’s Smart Service Desk

– HCL’s open 360 feedback


3. Turn your employees into promoters

Net Promoter Score: How likely is it that you

would recommend this company to a friend or

colleague?

1 2 3 4 5 6 7 8 9 10

Detractor Neutral Promoter

Extremely

likely Not at all

likely


The “Net Management Promoter Score”

How likely is it that you would recommend your line

manager to a colleague as someone they should work

for in the future? (1=not at all likely, 10=extremely

likely)

Detractor

87 people

Neutral

60 people

Promoter

55 people


A top quality boss is the best single

predictor of employee engagement


Coda: Experimentation as an approach

to management innovation


A new management style

Before

Traditional style

of supervision

of team

After

Supervisor spends 5 hours

more per week providing

feedback and coaching team

Hypothesis: A greater emphasis on ‘coaching’ will

increase the effectiveness of my team

Intervention: Supervisor has 5 hours

per week freed up (fewer meetings)

Team are asked to look for new ways of

increasing cross-selling

Result: Team members

more engaged, significant

increase in cross-selling

from lower performers


Principles of Experimentation

1. Focus on causes, not symptoms.

2. Make your hypotheses explicit.

3. Limit the scope of your experiment.

4. Run the new in parallel with the old.

5. Start at home.

6. Use volunteers, if possible.

7. Iterate.

Why Good Management is so Difficult – LBS Professor Julian Birkinshaw

Business

best work

good work

employees experienceat

work done2

doesnt work

work achievement

management willchange

work motivating andfulfilling