The new business value proposition — People

Leadership — “One of the most observed and least understood phenomena on earth.” James Burns.

Many employees in organisations today are dissatisfied with their jobs, feeling economically trapped, angry, frustrated, and unable to better their situation. The brave move on; they are the risk-takers, and they find a way to do better. But many remain trapped. What’s going on? What are the causes behind poor management and unhappy employees, and when did it all begin?

The cause of this dissatisfaction may stretch back to the early 1880s and the Industrial Revolution were cotton mills enforced a type of control we know today as the Traditional Management Model, also called the command-and-control structure — a term referring to keeping subordinates in line. This management approach, based on the hierarchical and often brutal British military and naval traditions, typically involved the development and implementation of strict rules of acceptable and unacceptable behaviour with harsh consequences for breaking the rules. The Traditional approach underwent a refinement in the 1920s and another after WWII bringing about the management model that dominates many of today’s organisations.

Having gone virtually unchanged for almost 100 years, this model is typically structured like this: A senior executive or board holds all the power; they are in command and use their power and influence to lead. They appear at the top of the organisation chart. Below them are senior managers, then middle managers, with employees at the bottom. We call this an organisational hierarchy.

According to the author and organisational development expert, Peter Block, Traditional-style leaders are the senior managers who command respect through seniority and years of service, often viewed as tyrannical and intimidating. Their job is to plan, organise employees, and direct and control. They set expectations for the employees below them who need to meet certain goals, but the manager receives the reward for achieving those goals. These managers also tend to experience a frequent turnover of employees.

New ideas from employees are not always welcomed; the managers see themselves as the source of all new business and ways of working. They can be blind to work and employment issues and slow to react to change. Regrettably, the employees have learned that the way their manager’s act is what the path to success looks like, so they model

Under Traditional models, “consistency and control were achieved through coercion and dominance. Organizations were set up as pyramids where power was distributed linearly from a small, select number of people at the top who controlled the majority of people positioned at the bottom. This top-down style of leadership was inherently hierarchical. Each leader was vested power and authority over those below them. These leaders often ruled with compulsion, force, control, secrecy, and — when necessary — physical, psychological, and/or economic violence. Thus, the tenets of Traditional leadership as we know it were established.” Peter Block, author and organizational development expert.

The Traditional management model is not about to disappear anytime soon despite being plagued by employees who are dissatisfied with their jobs and are unhappy with management who provide little or no support and motivation. In many cases, managers still simply see their employees as units of labour, easily replaceable and not worth investing in. These organisations are also inferior at training their mid-level managers, preferring instead to invest in leadership training for senior executives.

Aside from today’s organisations, we still see the Traditional model in use today in strict hierarchical organisations such as the military and police. As a management model in these types of professions, it has proven to be enormously successful, contributing substantially to global economic growth and the employment of millions. Just like its origins, it is good at making profits, but this has come at a high cost. The Traditional model vests a lot of power in individual managers, allowing them to impose their own form of control, rules, and regulations just as long as they achieve business goals imposed on them from above. If not kept in check, this power can lead to abuse. Following is a modern-day example:

I was asked to do what I considered was a very tough assignment by the Chairman of a large Insurance Group for whom I had previously worked. I only accepted the job out of respect for the man concerned. His problem was that a well-known IT consulting firm with a notorious reputation for completely taking over and being difficult to move on had seized control of his IT Department. The consulting firm had been appointed by his European head office to develop new IT systems in Australia. The firm was also costing him a small fortune, and there was an increasing litany of problems occurring with a growing chorus of employee complaints. My brief was to find out what was going on, remove the consultants, fix the issues, and restore service.

The day I arrived, I did so unannouncedly. As I was walking down a corridor looking for the office of the head of the consultancy, I overheard a voice say something like “Run faster this time.” With that, a banana peel came flying out of an office doorway into the corridor. This was followed by a distressed-looking young lady who quickly grabbed it and ran back into the doorway. I stood in amazement, then the whole scenario repeated itself, except this time with an instruction to “Do it faster.”

Again, the banana peel came flying through the doorway, followed by the young lady chasing after it. I stood and waited to see how long this would go on. The whole scenario happened one more time, except this time I yelled out, “I’ll get that!” and grabbed the banana peel, then walked into the office. As I entered, I politely asked if the lady sitting at the desk was the manager in charge; she replied, “Yes… and who the hell are you?”

I replied, “My name is Russell Futcher. I have been sent by the Chairman to find out what the hell is going on here, and now I have a pretty good idea. I will make this quick and easy; you have 15 minutes to pack your bag and leave the premises — you won’t be coming back. If you are not out of here by then, I will have security escort you out; it is your choice.” Her face turned ashen with disbelief, and her mouth was agog, but realising she had been caught red-handed, she started to collect the papers off her desk. With that, I turned to go and find the young lady who had been directed to chase the banana peel, who had overheard the conversation. I took her aside and apologised profusely for the behaviour she had been subjected to. I asked her if she would be forgiving enough to allow me an opportunity to make things better for her and the employees, and I promised that things would be very different from now on and finished by giving her the rest of the day off.

On speaking to the employees, many of whom I knew, as I had originally set up and staffed this data centre, I discovered they too had regularly been subjected to disrespectful and humiliating comments. They were the playthings of the banana lady and some of her staff.

The biggest problem with the Traditional model is that you have managers working within a strict hierarchy who can be intimidating people in positions of power who can be coercive, dictatorial, distrusting, and who treat their staff as subordinates with little value. Employees are growing frustrated at not having input into their work and they frequently leave when better opportunities arise. Employees are insisting on higher levels of job satisfaction and want their managers to be open and honest, fair and reasonable, and to value them and their contributions.

The new Millennial workforce is demanding that their managers act in a collaborative, supportive, and motivational manner. They are expressing that they will not accept the old command and control approach, which they view as being more like managing and directing versus leading, and they consider Traditional management to be suffocating, unreasonable, and unnecessary. Millennials respond favourably to a newer Transformational leadership style, where free-thinking, empowerment, and service and community are put ahead of self-interest. This newer model satisfies their desire to work across teams and their need for feedback and praise. No matter how they are viewed, the simple truth is that Millennials look at work quite differently than their predecessors.

A research study on American employees from Gallup found that 50% resign due to bad management. The study continues to show that having a ‘bad’ boss creates unhappiness in the office, adding stress and spreading negativity to their home life and families. Finally, workers feel like they’re given little guidance as to what’s expected of them.

It’s time for things to change. The Traditional way of managing has run its course. Increasing competition and rapid changes in technology are fortunately starting to move it into the background. Progressive leaders have known for decades that the Traditional, hierarchical pyramid model is outdated. It does not suit today’s fast-moving environment, nor does it suit today’s employees. Its rigidity cannot support agility, speed, or engagement, and then there is the troubling aspect of vesting of too much often-abusive power in managers over their employees.

Maren Fox of Berrett Koehler believes that progressive organisations and leaders are motivated by improving the well-being of people and communities in ways that have lasting, intrinsic value. A progressive management style is marked by transparency and sharing information with employees and that progressive leaders empower everyone and increase collaboration. Progressive leadership offers a clear alternative to the traditional, command-and-control model that has dominated the leadership model conversation for so long. It is a leadership style that values sharing and collaboration.

In an employee survey, management transparency was the number one factor contributing to employee job satisfaction. In that same survey, teams and collaboration were placed as the top attributes that employees valued about their peers.” — by Maren Fox — Berrett Koehler, 2018,

Progressive organisations use the newer Transformational Leadership model.

According to Bernard M Basa, author and researcher on Transformational Leadership, Transformational leaders tend to be more charismatic, and they are excellent motivators able to get people to do more than they thought possible. He goes on to say, — these leaders inspire followers with challenge and persuasion, providing meaning and understanding; they are intellectually stimulating. The leader is individually considerate, is admired, respected, and trusted with high standards of ethical and moral conduct. They actively mentor and coach. Creativity is encouraged with no room for public criticism of individual members’ mistakes. They pay special attention to each individual’s needs for achievement and growth, and their behaviour demonstrates acceptance of individual differences.

Transformational leaders motivate their employees to do more than they thought was possible. They set challenging expectations and typically achieve higher performance outcomes from their employees. They manage people as valuable individuals, identifying and developing their talents. They are supportive, encouraging and motivational. They are role models who are respected and trusted, and they build high-performance teams.

My first experience of a Transformational leadership style was at a progressive insurance and banking group, which engaged me as a member of their IT management team. It was also my introduction to membership in a high-performance team. My new boss, the Chief Information Officer, was a Transformational-style leader. He was a man with high energy and charisma. On my first day, he welcomed me with a “Hello,” then immediately asked his assistant to show me where I could sit. His assistant took me to an office, told me I was now the Applications Development Manager and that all of the 80 employees outside were reporting to me. That was it. A Transformational leader gives you their complete trust, their total support when asked for, and empowers you to do whatever you need to do. Accordingly, I had little need to speak to my boss, other than at a weekly management team meeting.

I soon discovered that my peers and fellow management team members were all operating the same way. There was one fundamental difference that I had never encountered before: my peers were concerned that I should do well, and continuously offered their unconditional support whenever I should need it. They expected the same in return. This new style of managing and working was a revelation for me, and I thrived.

Over five years, this team produced extraordinary results and excelled at everything it turned its attention to. It created new ways of working, new industry standards, and could manage a workload that would simply kill off any other team. The job satisfaction level was off the chart, as was the professional growth and learnings. The massive change was constant and welcomed, innovation was the norm, and all during a period of corporate expansion where a new company was regularly being added to the corporate group. This was a high-performance team created by a Transformational leader.

In 2007, I decided to do something radical. I found a job in Papua New Guinea (PNG) as the Head of Technology for the country’s largest IT provider. PNG is a developing country, which means below third-world status. There is a great deal of poverty, violence, and hardship. The nationals grow up in a village setting and have a collective consciousness. They are hardworking and intelligent people, even though there are high illiteracy rates due to many people having little-to-no schooling.

Just about everything you can think of at this company needed fixing. I inherited 150 employees and after arriving I wondered what the hell, I had gotten myself into. Technology aside, everything else was utterly foreign; the language was different, and respecting local customs wasn’t just important, it was vital. I learned on my first day that a wrong word or comment could have disastrous consequences when I innocently made a remark about grass huts and received looks of utter death. I had never before felt so exposed or vulnerable. I worked harder every day at this company than I had ever done before.

The company had a conservative Traditional management model, which was being harshly applied with employees being treated appallingly and like servants. I even had employees who called me “master.” I had my work cut out for me. In the business units that I managed; I used a Transformational management approach for everything I did while building high-performance teams. My business units had to coexist with others that were still being managed in a Traditional style. I learned that the Transformational model could be used in a non-Western environment and under the harshest of business conditions. It could not only coexist with, but it also complemented the older Traditional model. The results and outcomes achieved were genuinely surprising and were enhanced by the employees’ village culture of collaboration and shared decision making.

The introduction of formal training alone yielded incredible results with some employees (trained as computer engineers) receiving awards from the American computer manufacturer, Hewlett Packard.

The Transformational approach combined with the building of high-performance teams yielded considerable personal and professional benefits for the employees and the company alike. The key outcomes were that people’s lives were fundamentally changed for the better, they had job security, something they had never had before, and their job satisfaction was much higher. Their villages also benefitted. Many of the employees received formal training certifications, something of great value in a society of this kind and something that helped guarantee future employment opportunities. Productivity went up, the balance sheet went from red to black, and customer service vastly improved.

All I did was provide training, empowerment, support, and motivation. The employees did the rest; all they had needed was a leadership style that would accept them as they were and to allow them to use their considerable natural talents. The former Traditional model they had worked under crushed all of their natural abilities and instincts, as well as degraded them daily. It prevented a significant pool of talent from achieving its full potential.

The day I left, after having worked there for five years, many of the employees cried. I never know what to make of that; it had never happened before. I reminded them that they had done the work, not me, and I left knowing that the changes were sustainable. It was one of the best periods of my life, and I miss all of the people dearly.

The use of a Transformational leadership style combined with the use of high-performance teams also positively influenced the behaviours of the Traditional managers to be more open, collaborative, and far more considerate towards the needs and development of their employees.

The values of the Baby Boomers generation were based on a strong work ethic, respect for authority, loyalty, strong financial management, long-term planning, and delayed gratification. But now, we have the rise of the Millennial generation who have grown up with parents from an overworked era and have seen strain/stress grow before their eyes. Having seen this, the Millennials have a desire for work that means something and work which they are heavily contributing to. Therefore, this work needs to create happiness, and if this cannot be fulfilled within the workplace, then the generation will seek satisfaction elsewhere.

Research conducted by the Institute of Leadership and Management (ILM) discovered that 32% of recent graduates were dissatisfied with their boss’ performance and 56% of graduates cited their ‘ideal’ manager as a coach or mentor figure.

They are a generation who want to be fulfilled within the workplace while still having time to run with things they are passionate about. This is a new generation that cannot be compared to previous generations, where learning and professional development are essential to them. A flexible work-life balance is a strong, driving desire.

The new generation of Millennials is changing the business world. Information is now the most prized commodity and creative thinking the most sought-after skill, and Millennials have the latter in spades. Millennial workforce expectations do not fit with the Traditional model; this model fails them completely. Unlike the Baby Boomers before them, Millennials are not prepared to be quiet about this, and they are making their feelings known about their attitudes towards work and their expectations about how they want to be treated at work.

Today’s management can use this profile to their advantage. They can learn to manage each employee as a unique team member and establish a leadership approach that suits them best. The more approachable a manager can be with employees, the more relaxed the Millennial employee will be, and therefore, they will be more motivated to perform well for their bosses because of their increased respect and regard for them. Millennials are looking for managers who are interested in their professional development and inclusive organisational culture which rewards individual achievement and promotes merit rather than tenure.

A consistent and interactive management style works best for this generation, as well as regular, open conversations that involve the worker in their progress. Millennials crave responsibility and involvement within the workplace. Feedback is vital. Millennials need comments about their work, reviews, and suggestions for how to do better, especially if they are looking to progress to management. Teamwork is high on the agenda of Millennials, and regular team meetings and collaboration with colleagues is essential. They need openness and transparency from management within an organisation.

The fact of the matter is that the new Millennial workforce needs can be completely satisfied by the Transformational leadership model and the use of High-Performance Teams, both being enormously compatible with their needs and wants as against the old Traditional model.

After my PNG experience, I couldn’t stop thinking about why more organisations were not moving to a Transformational leadership model. It occurred to me that there is no established pathway from the old to the new, that is, from the Traditional to the Transformational. A transitional approach and model were needed to bridge the gap and allow for a staged migration. Organisations need time to manage such a significant change, and I determined this is best done organically by the building of high-performance teams within Traditional organisations. What was needed was a formal, transitional management model that combined Transformational leadership with the establishment of high-performance teams, just as I experienced at the insurance and banking group and in PNG.

I developed such a model and called it High-Performance Management and Teams.

This transitional model is based on the Transformational leadership style to progressively create a high-performance organisation. Under this model, the concepts of leadership and management are transposable and are not just integral; they are the same. The model works by building high-performance teams as the vehicle for crossing the pathway between the old and the new. It trains all levels of management in high-performance management methods and techniques, bringing about the advent of the high-performance manager, with an emphasis on people leadership skills. The management style is transformational, transparent, and places people first. It creates high levels of mutual trust, mutual accountability, and collaboration. Open communication is a key feature, as is the concept of shared leadership. One of the key benefits of this model is that it does away with any opportunity for management abuse; it quickly identifies and facilitates the calling out of managers who are trying to manage with compulsion and force.

The model recognises that employees are demanding and deserving of higher levels of job satisfaction and trains managers to be open and honest, fair and reasonable, and to value their employees’ contributions. It supports employees’ demands for recognition of their efforts, their need for a collaborative environment, and allows employees to have a say in how their workplace is managed.

Teams, on the other hand, are driven by the need to be more competitive and by changes in business technology. However, Traditional teams’ organisational structures have limitations; they are silo-based and are almost exclusively project-driven, facilitating only existing skillsets. They do not employ modern management behaviours, methods or techniques, and they largely just reinvent as against genuinely innovate.

High-performance teams do not suffer from these restrictions. Team members have complementary skills and can change roles and leadership is not restricted to an individual. In a high-performance team, the manager acts as the role model who aligns commitment with a common goal and individual performance goals. There are robust methods of resolving conflict, shared norms and values, a strong sense of accountability, and high levels of mutual trust. The team shares a collective consciousness and has clearly defined roles and responsibilities, team rules, and behaviours. Team members are fully empowered and held accountable.

Finally, the model covers the people change process and provides training on a range of high-performance behaviours, methods and techniques covering team bonding, time management, personal performance and productivity improvement, and most importantly, how to support and motivate.

Team Members can expect significant job satisfaction, more expansive career opportunities, comradery, and being the best in their chosen field. They receive professional development and acquisition of new management skills, over time becoming increasingly better at whatever is being done and developing the ability to overachieve in comparison to others.

The benefits to the organisation are becoming an employer of choice, staff loyalty, increased competitiveness, profits, ability to expand rapidly, market growth, and having teams focussed on business needs. Add to these: reduced costs, improved performance, efficiency and productivity, improved services and products quality, as well as better service delivery and technical capability.

Today, progressive organisations are leading the way with respect to how they view people management; it is these organisations that are making the move to Transformational management and the use of high-performance teams. Progress, however, is painfully slow. Perhaps the publishing of this chapter might help move things along with the use of the pathway I have created. I will leave you with this question to ponder: Do you want to work (or have your children work) in a Traditionally managed organisation where personal and professional opportunity is limited or delayed? Or would you rather work in a progressive organisation that values people as their greatest asset and employs transformational and high-performance management methods?

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