Most organisations are badly run. Anybody who has ever been an employee has an anecdote about a dysfunctional organisation, populated with inexplicable decision making, toxic culture and crazy line managers.
“Most organisations are poorly run, and there are repeating patterns that go behind that,” said James Lawther, author of Managed by Morons, on the latest episode of CX Lore podcast.
According to Lawther, organisations need to spotlight three main areas — a focus on its purpose, its ability to learn and adapt, and its culture. “If you get those things straight, you will have a thriving organisation,” said Lawther.
Unfortunately, organisations commonly fall at the first hurdle. Lawther’s book is full of stories about entities that get distracted and lose focus. Whether it’s UK healthcare organisations too busy gaming government targets to care for patients, or Elon Musk getting pulled into US politics, when organisations lose focus, bad things start to happen.
“For me, the whole culture of denying issues and focusing on the wrong things is endemic everywhere,” he added.
Organisations — and their leaders — must enhance their learning capability if they are to adapt to changing circumstances and improve. Lawther recounts a story about Unilever’s quest to improve the design of a nozzle in one of its manufacturing facilities. Two teams were formed to develop the optimum design; one full of engineers and the other made up of evolutionary biologists and geneticists.
Learning from failure
The biologists eventually developed the most efficient nozzle. “To get the best nozzle, they had something like 319 failures,” said Lawther.
Not many organisations can afford that level of failure. But fewer still comprehend the lessons learnt from failure. “The attitude to learning is really important,” he added.
Another core ingredient is company culture. Unfortunately organisations rarely spend time and energy deciding on what they want the culture to be, or how to achieve it.
Culture is commonly sacrificed to short term goals. Short term thinking can be so toxic that Warren Buffett, chairman of Berkshire Hathaway did away with company-wide budgets because “he didn’t want managers fixating on short term targets,” claimed Lawther.
Focus on long term goals
Jeff Bezos, founder of Amazon, is another successful leader that adopts a long term approach. His outlook is best reflected by his obsessive focus on customer experience. Whether it’s developing ‘one click’ shopping, or building Amazon’s own logistics infrastructure, he has constantly spurned cheaper alternatives to put customer experience first.
Bezos “has been really clear about the customer and the purpose — it is all important”, said Lawther.
An organisation’s purpose, learning capability, culture and CX are often undermined when it starts to scale. Growth inadvertently erodes the trust between customer-facing staff and management teams. “Organisations as they start to scale lose trust in their employees. They build silos so they can control things,” said Lawther.
“Then customer experience, which runs across those silos, gets terribly disjointed,” he added.
Leadership needs to do more
Leadership has a huge part to play in steering and shaping organisations. Purpose, learning capability, trust and culture all need to be firstly established and then nurtured to flourish. But leaders whether they are CEOs or line managers, often focus on commercial concerns to the exclusion of other concerns.
How do you get corporate attitudes to change? “That I think really comes down to education,” said Lawther.
To listen to the podcast click below.