Can You Improve Your Organization’s Effectiveness?

by Bryan Lane Berson, Esq.

Last month’s column explored one of Peter Drucker’s masterworks, The Effective Executive. This column analyzes additional insights to improve organizational effectiveness.

Drucker noted that poor job design impedes effectiveness. Jobs that defeat multiple executives in succession should probably be redesigned. Organizations should not have to recruit superheroes. Good processes enable ordinary people to do extraordinary things.

Jobs that are too small in scope tend to demoralize good executives. In a competitive marketplace, narrow subspecialties can quickly become obsolete. Managers should deploy personnel according to their strengths and aspirations. Workers who feel unappreciated or underutilized will leave the organization in search of seemingly better opportunities. Executives should be able to grow with their jobs and adapt to the demands of the marketplace.

Drucker harshly criticized annual job appraisal practices. Frequently, after a significant period of time, workers who thought they were doing a satisfactory or superior job are informed that their work is unsatisfactory.

In Out of the Crisis, W.E. Deming classified annual reviews, performance evaluations, and merit ratings as a “deadly disease” that afflicts most companies in the Western World. In Dr. Deming’s red bead experiment, he demonstrated that forces beyond a worker’s control can product large differences in their performances. Success or failure could be the result of good or bad fortune, but nevertheless, workers tend to be ranked or evaluated upon it.

Workers who seek advice from managers may view them as mentors. Thus, managers who search for those workers’ faults tend to erode trust among people who seek to improve. In Six Sigma, processes (e.g., DMADV, DMAIC) rely on continuous feedback to improve performance. Constructive criticism and feedback are important, but negative annual reviews tend to harm relationships.

Drucker believed that appraisals should focus on strengths, identify weaknesses that interfere with those strengths, and identify methods to accentuate the positive and eliminate the negative. He suggested a simple, alternative method of appraisal. It asks:

1. What can one do well?
2. What is one likely to do well?
3. What must one learn to harness the full benefit of those strengths?
4. If I had a child, would I let him or her work for this person?

Drucker believed that it was more important to staff based on strength rather than to avoid weakness. The absence of character and integrity, however, were weaknesses to be avoided at all costs because they fault everything else.

Drucker believed that “indispensable” executives are likely incompetent, bolstering a weak superior, or being used to delay addressing a serious problem. If an executive cannot adequately handle a job, it erodes the morale of the subordinate who must compensate for him. The superior may be fit for a different job. Workers who are best qualified to perform a job should be promoted in spite of arguments that they are indispensible, unacceptable, too young, or inexperienced.

Resources should be directed towards the best opportunities. Many organizations waste time and resources bailing out unproductive decisions from their past. If the organization would not again embark on a problematic project, it should curtail the activity.

Executives require an effective decision-making process. First, they must determine if the situation is “generic” or an exception. Most problems are generic and can be solved through policies or rules. Few problems are exceptional. Sound policies reduce the number of decisions executives must make.

A non-recurrent problem is rare for an individual or organization but common within a large population. For example, a company’s business model may become unsustainable. A business may go bankrupt once, but companies go bankrupt all the time. Attorneys and turnaround managers can address such matters where the company lacks expertise.

To adequately address a problem, one must clearly define its “boundary conditions” and determine how a solution will satisfy those specifications. Then, a decision must be implemented. This could be time-consuming. Feedback tests the validity of the decision and process, which may then be modified accordingly.

Practicing effective behaviors makes them habitual. It enables organizations to better serve customers, increase revenue, decrease costs, and increase long-term profitability.

About the Author:  Bryan L. Berson, Esq. is an attorney and mediator at The Berson Firm, P.C., a commercial and civil law firm that handles estate administration and planning, real estate, commercial transactions, mediation, and commercial litigation.  His e-mail is bberson@bersonfirm.comHis phone number is (631) 517-1055.  Connect with The Berson Firm on Facebook and Bryan L. Berson on LinkedIn.  The firm’s website is www.bersonfirm.com.

Disclaimer:  Constructive Knowledge is published by The Berson Firm, P.C. (the “Firm”).  The information contained in this column is provided for informational purposes only.  It is not tax or legal advice on any subject matter.  No readers, clients or otherwise, should act or refrain from acting on the basis of any content without seeking appropriate legal or other professional advice with respect to one’s particular circumstances.  This column reflects a general discussion of the law in New York.  It may not accurately reflect the law of other states.  The content is general information and may not reflect current legal developments, verdicts, or settlements.  The Firm expressly disclaims all liability with respect to acts taken or not taken based on any or all content of this column.  This column is Attorney Advertising.  IRS Circular 230 Legend:  Nothing in this column is intended to be used and cannot be used to avoid U.S. federal, state, or local taxes.  It was not written to promote, market, or recommend any tax planning strategy or action.  Copyright:  All rights reserved.  No part of this publication may be reproduced without prior written consent.  Readers may share this column through, but not limited to, social networks.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: