Thursday, August 15, 2013

Owner’s Concerns v/s Employee Concerns

Owner’s Concerns v/s Employee Concerns

The corporate dynamics today has taken a complete new turn. Companies are spending huge amounts of money and resources on employee engagement and training, largely focusing on employee retention and efficiency enhancement. Overall spending by businesses on workplace training and development has increased by 12% last year, according to a new study by a leading consulting firm. In spite of these efforts taken by the management to attain one common goal- growth, business owners are still finding it difficult to chug the engine and the workforce bogies faster towards the envisaged destination.
Blessed are the businesses that do not need to constantly face the following “chicken first or egg first” scenario.
Business Owner: “I am more than willing to give what my people want, if they deliver what they have promised.”
Employee: “I am more than willing to perform if I get what’s promised and all the resources I need to do the job.”
Take the recent case of a French video game offering players the chance to become a virtual employee of steel manufacturer ArcelorMittal and fight against a giant robot representing the owner, the Indian billionaire Lakshmi Mittal. While one could argue that this is the extreme representation of the gulf (and resulting resentment) between a company’s leadership and its employees, it’s also true that more and more businesses are dealing with the challenge of making these two forces focus in one direction.
Where lies the challenge?
A business caters to the following needs of its owner and the employees when it is a progressive small firm. (i.e. owner is synonymous with the business he runs).




When this business grows and becomes big in terms of scale of operations and geographies start expanding, the needs it caters to the owner and employees also change. 


This may seem like a natural change. Notice the possibility of the common needs that get catered to drastically reducing i.e. the common purpose the business serves is only as a source of income. If this expanding gulf between the employees and the owner is not attended to the chances of realizing the envisaged goals become further bleak.
Can you imagine what would happen to a chariot where each horse pulls in a different direction driven by its own set of motivations?
Why this challenge?
As a parent, they say, one of the most challenging relationships to manage is the one between a teenage child and the parent.  Why is that?
Frictions start developing when the needs that get catered to through this relationship have a minimum level of overlap. Similarly, when a small boutique company progresses and evolves into an SME and eventually to a corporate, the purpose it serves to these two sets of stakeholders also starts to differ drastically. And the last thing the chariot of business needs is these horses applying forces in different directions.
What are the common assumptions that must be avoided?
“Can’t they see the numbers? It’s common sense that we must be as frugal as possible at this hour!”
No, they can’t see it. And what’s common sense to you is business acumen to others. Instead focus on how you could be a story teller who can inspire them to rally behind you and help overcome the tough times.
“They are not operating at 100% of their efficiency. If they did I would be in a different orbit.”
Even a F1 driver cannot give his best if the environment is not competitive and the car he drives has glitches. The owner’s job is to make the environment competitive and to put in a system that doesn’t allow mediocrity.
“Management seems to be totally divided or confused about certain strategies. I wish they knew better.”
Running a business is more like sailing a ship from one continent to another. Ambiguity is the name of the game. Trust the captain to do his job at the deck. Diligently do your work at the belly of the ship.
So what needs to be done?
How effectively a leader can manage these situations is directly proportional to the number of opportunities he/she creates for the involved parties to get into each others’ shoes. Some businesses believe that this is the role of the HR function.  However, successful organizations recognize that while the HR function plays the role of facilitators of such opportunities, it’s the leaders who take the accountability of tapping on these opportunities. The opportunity could be a town hall, storytelling sessions, skip level discussions, anonymous surveys, one-on-one discussions, or any other form of engagement activity. The key is to make this a part of the system and put in enough measures to ensure that mediocrity doesn’t creep in to the execution of the same.
(The author of the article is Rajesh Shetty, Senior Consultant, Acumen Business Consulting.)
About Acumen:
Established in 2000, Acumen Business Consulting is a management consulting firm dedicated to deliver business success to organizations globally. The company focuses at providing practical and implementable solutions to bring about a transformation in organizational strategies, people and processes.
Built with a strong team of professionals, the company was incepted with an objective of making organizations work smarter, be more sensitized towards employees and the business environment; which in turn maximizes their profit potential.
Acumen has conducted over 110 engagements across India covering industry verticals like Manufacturing, Real Estate, FMCG, Telecom, Automotive and Pharmaceutical, both domestic and international.

Friday, June 28, 2013

The “Blocked Mindset Challenge” faced by SMEs in India


The “Blocked Mindset Challenge” faced by SMEs in India
The pivotal role played by SMEs in our dynamic, yet pulsating and rapidly expanding economy has no denial. In spite of the huge underlying growth potential, they only contribute 17% to the Indian GDP. It is intriguing to know that about 80 percent of SMEs die out before their 5th year and only a few thousands amongst the potent SMEs are listed on the Stock Exchange. 
External factors like market and competition, finance, government policies, etc. play an inferior role in hindering the forward leap. Neither is it the lack of aspirations amongst entrepreneurs, nor is their tendency to remain mediocre, which is stagnating the development of enterprises. What is plaguing this intent is the “Block Mindset Challenge” faced by the Indian SMEs.
“Mindset” is nothing but a set of beliefs or principles acquired in due course of time. These beliefs have laid the foundation for the success of the business, and have been accumulated with experiences gathered by an individual (entrepreneur or employee), throughout his/her journey. But in today’s effervescent and challenging market dynamism, one needs to follow Darwin’s theory of adaptability, which advocates the survival of the fittest!
Mindsets exist at every level of management in an organization.
Mind-blocks at the Executive level: The employees at the bottom of the pyramid definitely form the foundation of organizational growth. It is ultimately their manpower which will materialize the strategic plan and structure laid out by the higher authorities. Mind blocks are born at this very base level of the organization; the nature of these blocks deepens and intensifies at every level towards the top of the pyramid. Employees reporting to managers develop stereotypes and may believe that their contribution may never be appreciated, that there may be biases; their opinion would not matter and so on. They develop a generalized viewpoint about the work culture, cross-functional teams and the senior most level of management.
Mind-blocks at Managerial level: The middle level managers holding key positions like SBU heads, project heads, etc. have evolved along with the augmentation of the organization. They have attained echelons with significant contribution and are a link between the top and lower levels of management. Prolonged appreciation for their involvement may also boost the self-image of the manager, which can act as a fatal mindset block. This may lead to a myopic mindset towards the employees. Due to lack of performance measuring tools, the manager may be biased towards a few employees. They may alsorestrict the progress and flow of innovation by their bureaucratic styles of leading a team. Beliefs like “a subordinate cannot think or contribute better or even as much as I can”, “My way or the highway”, “empowering employees can risk my position in the organization”, etc. are lethal to the overall functioning of the organization. Autocratic leaders pursuing lofty goals can take companies away from their core business and blur a corporation's identity.
Mind-blocks at the Senior Management level: At the senior management level, the entrepreneur faces the most terminal mindset challenge. Majority of Indian Businesses are family operated and functional from generations. The entrepreneur may succumb to a rigid management style leading to differences of opinion amongst the old and new generation. Concentrating on the day-to-day operations of their organization, the entrepreneur may miss out on the greatest opportunity to expand. Fervor to handle and control each and every operation of the organization diverts their focus from the core business areas and sidelines the need to curb competition. It's high time that the delegation of authority is implemented in business so that you can focus on more important issues where your expertise lies.
How do Blocked Mindsets affect organizations?
The instability arising out of these mind blocks at every level in the organization hinders the creation of the leadership pipeline. It ultimately diverts the focus from strategic goals and there remains no congruence between the various functions of the business. These intrinsic loopholes affect the key growth essentials like value delivery, customer satisfaction and competitive advantage, leading to opportunity loss.
SMEs need to understand business in a ‘holistic manner’
In order to get rid of this pessimism in the organization, a self-introspection study is crucial at all levels of the hierarchy. As per a Portuguese proverb “Change yourself and fortune will change with you.” The entrepreneur needs to probe himself whether his mindset, focus and actions are aligned with the pre-meditated goal, whether these goals are well communicated to my organization, whether the organizational synergies flow in the direction of attainment of these goals. The key to making parallel all of the above is to identify impediments and sharing them with the management, so as to divert their focus from individual goals to work towards the common mission. 
The managerial level employees need radical thinking towards the business and a deeper understanding of how to work with immediate teams. One needs to realize the significance of their role, serving as a link between both, the upper and lower level of management, and harness their position to streamline efficient functioning. Along with numerical aspects like targets and output, the managers should turn on the spotlight towards behavioral aspects of the workforce. This implies articulating and building values thereby measuring performance based on activities related to the holistic well being in the future. 
Handling objections:
For organizations diseased with such manifestations, it is crucial to take immediate corrective actions. As quoted by Anthony J. D'Angelo, “The only real failure in life is one not learned from.Prioritizing this remedial process needs extensive commitment and needs to be carried out in an organized manner. While doing so, the leader would face enormous objections and resistance which may delay the process. Imbibing the right approach can be done by virtue of assistance offered by third party companies, which not only study these mindsets but also offer implementable and sustainable solutions. 
According to Jack Welch, “Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others.” So the initial brick is to be laid explicitly by the entrepreneur himself and the organization would follow!
(The author of the above article is Mr. Tanveer Shaikh, Principal Consultant, Acumen Business Consulting.)