Change your perspective and change your business
3 specific actions to improve organizational behavior
“If you change the way you look at things, the things you look at change”- Wayne Dyer
Even a prosperous business can get into trouble if it does not actively construct its future. For this reason most companies perform the following 4 performance improvement actions:
- Strategic planning: set direction and strategy to obtain a certain competitive advantage.
- People development: improve the skills and attitudes of the people so that they perform better.
- Functional capacity building: build knowledge and excellence in functional disciplines.
- Process improvement: optimize process performance, and insure that the process meets business requirements.
These 4 actions have all a very different nature. For example, managing individual performance of the people is not the same as the collaborative achievement we need to optimize processes.
But they share the same goal and are complementary. We can see them as 4 different perspectives on one complex reality that need to be integrated. Otherwise we have a false or incomplete understanding of their company.
The organizational perspective
“For every minute spent organizing, an hour is earned”-Anonymous
There is another way to view a business. It is the organizational perspective and only few companies use it with a clear and systematic focus.
This perspective teaches us to look at the following 5 building blocks of an organization:
- the participants, which make contributions and desire benefits from the organization
- the social structure, consisting of the persistent relations that existing among the participants
- the goals that participants want to achieve trough task activities
- the means by which organizations accomplish work
- the physical, technological, cultural and social context
The organizational perspective is in reality a combination of different perspectives or models. Each one provides a different understanding of the same reality. And we can select which one to apply in a specific situation.
The following is 3 situations and needs that arise in every company. Each one has a specific organizational model that permits to handle it systematically and effectively.
1 Make decisions based on facts and analysis
“Rational behavior requires theory. Reactive behavior requires only reflex action”-W. Edwards Deming
Imagine you want to achieve a clearly defined goal, and you need to take an important business decision about it.
A tool, known as the Rational Choice Model, can help you to analyze choices made in the past and make sure you make fact based decisions.
At the heart of the model lie four key concepts that are applied step-by-step in decision making:
- The first concept is goals and objectives. What are the guiding values, or the most important constraints that should be taken into account?
- Next, the alternatives, or possible courses of action, are listed.
- Then the consequences of each listed alternative are considered. What is the impact of each alternative?
- The final decision is made, maximizing the value in the context of your original goals.
Even though no organization is completely rational in the real world, business leaders can effectively apply rational organization theory in some situations.
If we can clearly identify our goals and have enough available information, we can use the Rational Choice perspective to ignore workplace politics and rely on the rational structure of the company to make the best decision.
2 Remove inconsistencies between different processes
“Consistent action creates consistent results”- Christine Kane
The second perspective is the Organizational Process Model. It assumes that individual decisions are not based on a logic, but on what people consider to be most appropriate.
This appropriateness is determined by the company’s particular structure and procedural rules. For example, how the responsibilities are distributed among different divisions or managerial levels, or what are the meeting schedules and the rules of order.
Standard operating procedures play an important role in individual decision making. Sometimes these rules are effective within a single process, but they create problems for the total organization.
Looking at our company through the glasses of Organizational Process Model makes us see if there are inconsistencies within a sequence of different standard procedures.
Our task is to make sure that the actions people consider as appropriate, are also the ones producing the best results for the total company. This can be done as follows:
- Make sure that people know the rules and when to apply them.
- Update procedures regularly so that they deal correctly with specific situations.
- Balance the distribution of responsibilities among different divisions and teams.
- Sort out all potential conflicts and contradictions between the different procedures and the routines of the people.
3 Avoid coalition conflicts
“Lots of people want to ride with you in the limo, but what you want is someone who will take the bus with you when the limo breaks down”- Oprah Winfrey
Not only rationality and appropriateness drive decisions and actions within an organization.
People and divisions sometimes determine their positions asking themselves one specific question: What’s in it for me?
Because of this, our organization has inconsistent preferences and different ideas on problems and solutions.
Some groups might have a high and broad interest in getting a certain measure approved or blocked. They will try to reinforce their weak individual positions by forming coalitions with others.
The Coalition Theory is a third perspective on organizational behavior. It explains how individuals team up temporarily for a specific purpose. A coalition is informal and independent from the organization’s official structure.
Coalition forming is essentially a game of political bargaining. A dominant coalition often does not have the best interest of the whole company in mind. Nevertheless it can have a very high impact on the company’s decision making.
As a business leader you should use the Coalition Theory to defuse any potential coalitions that want to protect the parochial interests of one particular group or team. You need to consider possible responses to oppositions. This can be done by identifying key players, know their interests and work constructively with them.
But the best way to avoid harmful coalition making is to make sure that a large majority of the people have the same goals, and buy in to the decisions that have been made.
Conclusion
Organizations can change and improve their business by studying the way its people interact within groups.
The organizational perspective is a different way to look at what happens inside a company. It includes important aspects of performance improvement that are neglected if we evaluate a problem only at the level of the people or the processes.
Becoming an expert in organizational behavior helps a leader to maintain a management group of shared interests and recognize which managers will pursue even if difficulties arise.
Do you want to find out more?
You may want to read this previous article to discover more on performance improvement and how people, processes and the organization influence each other.
Thinking about new ways to create competitive advantage and improve your organization? This PDF describes the 4 pillars that increase enterprise performance and helps you to apply them in your company.
