SC&RA COMMENT: The cost of dysfunction
14 April 2020
As much as we endeavor towards productivity in our industry, and the data that comes with it, we might be missing a metric hidden in plain sight: dysfunction.
A quick question you could start off asking yourself and/or your management team: for every dollar you spend, how much slips through the cracks to cover the cost of dysfunction – i.e. self-inflicted wounds, poor strategy and communication, inefficient operational methods and overall mismanagement of personnel?
Providing for what almost any company would determine as acceptable loss, the question remains: how much work is done within your company on internal matters or correcting problematic issues versus creating value for your customers and clients?
As it turns out, most dysfunction is perpetuated and sustained by a driver. Often there is more than one – you might know them: activities that give off the appearance of actual work, but are in fact not creating any value.
Maybe you recognize this one: the wrong person is in the right position. In other words, the position isn’t the problem, the person is. And this happens more than you think. But why? Especially if it becomes apparent that this person, in that position, is hurting the company?
There could be many reasons – but that’s not necessarily the point. The question is, what are you going to do about it? Too often, underperformers are kept around on senior teams, or people are simply placed into positions that ultimately don’t align with their skill sets. It’s on the leadership to flesh out the problem and set a corrective action. Otherwise, the problem will persist, and the company will continue to suffer as a result. However, moving someone to a different position may prove completely worthwhile. But you’ll only continue down a reductive path if you choose to ignore it.
Under the weather
Then there’s strategy. How much of it really just sits carefully formulated in your own mind, while everyone else struggles to interpret what you assume has been articulated? This one’s not exactly uncommon either. But it’s equally dangerous. Because when a shared understanding of strategy/goals/mission isn’t established, people can often establish their own versions of it. And even if those versions are well intended, you can see how this could become exponentially worse over time.
Employees can end up wasting tons of time, energy and money creating systems and process from a strategy that they only partly understand. And if an entire department is practicing such behavior, it could lead to substantial revenue loss. It’s on you as a leader to guarantee that everyone within your organization understands the strategy, the goals and the mission designed to deliver long-term success to the company.
Another facet of industry business we’re dealing with more as the marketplace becomes more digital and innovation becomes more reliant on tech is organizational structure. Many of our management team members and leadership now work within various cross-functional disciplines.
Companies are being forced to adapt to the market and become “agile,” or else. But this puts pressure on employees and groups to develop more reporting lines, rotating hierarchies, seemingly endless meetings and, sometimes, operational silos.
Staying on top of this one requires a team effort to both recognize and organize the strategic framework built into the company’s operational processes – even as they adapt to the demands of a changing marketplace, industry and customer base. To that end, ignoring this one could possibly be catastrophic.
But don’t let it get to that. If you think your company might be a bit under the weather in this regard, take the steps to organize your people and get to the root(s) of the problem. We know that the industry we work within will only get more challenging, in all its suggestions. It will serve you well to assure that your own business is not the largest of those challenges.