When the problem is identified, and it is you

By Gregg M. Schoppman, FMI

Organizations can often be characterized by the “Goldilocks Principle.”  Sometimes there is too much management, creating a smothering effect or micromanagement feel.  In some cases, there is complete autonomy leading to hyper-dysfunction and a complete lack of control. Leaders wrestle with an ever-changing swing of the pendulum to find the happy median. Even when that “nirvana” is found, there is still something that is amiss.  No one is hovering over the team and there appears to be a modicum level of structure.  How can something so right still feel so wrong? The issue is the throat in the communication hourglass. Better yet, it is the boulder clogging up that throat, choking the flow of communication. Put another way, the problem is you.  

Now that we have your attention, organizations need to understand the fundamental definition of empowerment.  Empowerment is defined as the “authority or power given to someone to do something.”  Notice that this definition is about creating action.  The definition does not say, “authority to do something but first it has to go through senior management.”  Firm’s wrestle with this daily.  In some cases, the team may lack the ability to make knowledgeable decisions as a result of inexperience or lack of training.  It is not uncommon to delegate a task and then have some check and balance in the process to ensure accuracy.  However, there is a fine line when everything requires a sign-off or authorization.  Consider these statements – “We are just waiting for JOHN/MARY/STEVE/JOAN to sign off on that” or “We can’t have the meeting without JOHN/MARY/STEVE/JOAN” or “Nothing happens without JOHN/MARY/STEVE/JOAN!”  In fairness to JOHN/MARY/STEVE/JOAN, I am sure they have the best intentions and it isn’t like they are sitting in a recliner eating Doritos.  However, if you have ever muttered these statements, you might have a boulder problem.

Process Breakdown

There are most certainly decisions that should require some level of authority.  For instance, it is probably prudent to vet large capital expenditures or limit the decision making to specific personnel.  It might be a little awkward to have every equipment operator deciding when to buy a new front-end loader or every project manager signing off on new software.  However, there is no shortage of decisions that create this bottleneck. For instance, consider the following areas where bottlenecks appear to occur:

• Planning Meetings – In many cases, there is a feeling that a meeting cannot occur without a complete quorum or more importantly the Operations Manager or President in attendance.  While this sounds excellent in theory, how many meetings are delayed because the Operations Manager and President are busy.  Instead, the meetings are punted, leading to larger issues in the long run.
• Minutia Approval – There is a difference between keeping someone in the loop and requiring their approval.  For instance, how many small details on projects require someone to “sign-off”?  Does this level of minutia smell like the right level of management or does it reek of “cover your butt?”
• Levels of Approval – As stated previously, we probably want to limit the big dollar decisions to the right decision makers.  On the other hand, does the firm have appropriate levels of authority when it comes to change orders, proposals, purchase orders, etc.?  Some organizations will have field leaders limits on their purchase orders yet ask them to be responsible/accountable for multi-million projects?  This is like sending a young man/woman away to college but requiring them to call home every night to make sure they aren’t doing anything bad.  

One mechanism that will help identify these boulders is the examination of the internal processes within the firm. For instance, if all of the processes were illustrated in a story board, how many of the “nodes” or decisions, fall on the same individual? This is not to say it is wrong, but the subsequent question should be this – Is this working and are we asking one person to singularly be responsible for everything? Similarly, as these processes are mapped, what is the overall timeline that is created?  Do the steps in the process require 2-3 more touches creating 20-30% more effort for no added value? 

Decision Rights or Outcomes?

As stated earlier, some organizations are hesitant to assign decision rights because of inexperience. For years there are steps in the process that were implemented because at the time of origination it provides some level of security or comfort to leadership that wrong decisions would not be made. This seems plausible in the short term as an excellent stop gap measure to prevent disaster. However, upon deeper examination would the firm be better served by addressing the pivotal issue which is “talent development” through a more concerted training and educational solution rather than inserting gates that create levels of dependency instead of accountability? Put another way, a firm can use “training wheels” on its processes but at some point it needs to either really teach the team to ride the bike for real.

Additionally, there is a perception that these “approval gates” serve as checks and balances to ensure no one is going rogue.  Once again, this is a reasonable measure to implement in the short term, possibly as a measure for newer associates learning a firm’s systems.  However, would it not be more effective for the firm to measure the outcomes of a process rather than approvals? If a firm has a set process and managers are held accountable to follow these processes, the outcome should be the most important item.  As an example, think about a quality control procedure for something like concrete or asphalt.  Testing is done on select samples of a mix or batch that is created in accordance with a recipe or mix design.  It would be impractical and hardly cost effective if every ton or cubic yard was tested before placement. The same can be said for managers and supervisors that must gain approval for every action. 

Successful organizations have found there is the right balance between accountability, responsibility, and empowerment. For firms to grow profitably, the leaders know they must implement a capable team that is predicated on decentralized decision making and boulder removal.

About the Author

FMI is the largest provider of management consulting, investment banking, and research to the engineering and construction industry. FMI works in all segments of the industry providing clients with value-added business solutions. For more information visit www.fmicorp.com or contact gschoppman@fmicorp.com.