18 Jan. 2013 | Comments (0) Share Follow @Conferenceboard
In my last blog, The Quality of HPO Managers, I discussed the first factor of High Performance Organizations (HPOs). In this article, I’ll address the second factor: “Openness & Action Orientation.” Openness & Action Orientation is integral to the performance of an HPO and is best understood by looking at its six characteristics: dialogue, knowledge sharing, employee involvement, allowing mistakes, welcoming change, and the ability to drive performance.
Here, a definition is given for each characteristic followed by a description of the behaviors of HPO managers and employees that is typical of the characteristic.
Not all communication is dialogue. Unlike communication – which refers to a one-way process in which one party (usually management) conveys a message to receivers (usually employees) – dialogue is a two-way process. Senders and receivers exchange views and provide content and quality to the subject by discussing its meaning and consequences, and improving it. HPO managers do not confuse meetings (regular operational meetings, management team meetings, quarterly reviews, town hall meetings, etc.) with true dialogue.
One tactic HPO managers use to promote dialogue is the “open-door policy,” but they give this tactic a different interpretation. As one HPO manager explained: “An open door policy for us means that the door is open for us (executives) to leave the office and to go to the work floor. People always feel a hesitation to enter the office of the chief executive officer, so I need to come to them. I try to go to the production floor at least once a week to talk to people. And every morning, I do my rounds on the office floor, to chat with people and see how they are doing.
2. Knowledge sharing
Knowledge is considered to be one of the most valuable assets of present-day organizations as it embodies best practices, routines, lessons learned, problem–solving methods, and creative processes that are often difficult to replicate. People in an HPO, therefore, actively share information, knowledge, and best practices organization-wide.
Management ensures there are infrastructures and a shared knowledge base present in the organization. This is important as research has shown that organizational boundaries (i.e. business unit, job function, office location) have a negative influence on who interacts with whom inside the organization. Individuals who share the same office location or job function, for example, communicate at an estimated rate of approximately 1,000 times higher than two people that are not within the same boundary and who are geographically separated!
3. Employees involvement
Greater commitment is created among employees when they are allowed to participate, have their say, and can feel co-owner of the decisions and actions that are taken. There are, however, some conditions which need to be met in order to create effective involvement. Participation doesn’t mean that everybody is entitled to participate in everything at the same level. People participating must have enough knowledge to be able to usefully participate; the participants must be aware that they are participating for the greater good of the organization, not to serve their own interests; and participants must be able to deal with uncertainty and ambiguity, as there is no guarantee that they will always influence things in the way they want to.
Recent research has shown that one of the top ten differentiators between winning and non-winning organizations was that, at winning organizations, the contributions of employees to the organization’s success were always recognized. Interestingly enough, this recognition not only manifested in monetary terms, but also in the feelings of employees that they were taken seriously by management. Because employees are allowed to participate and have their say, employees have a greater commitment to the organization and feel themselves to be co-owners of the decisions made and actions taken.
4. Allowing mistakes
Research shows that organizations learn more effectively from their mistakes than from their successes, and that knowledge from mistakes depreciates more slowly than knowledge from success. However, in general, people have difficulty owning up to a mistake, and this issue becomes all the more true as we move higher up the organizational ladder.
HPO managers have a tolerance for failure and setbacks, because focus is on remedying and improving; there is no need to play the blame game. In an HPO, nobody cares about why a mistake was made, but, instead, about how it is going to be fixed and what can be learned from it. People in an HPO also know that if they never make a mistake, they are probably playing it too safe and are therefore not innovative enough. There is, however, one type of mistake that is never allowed: the same!
5. Welcoming change
Welcoming change is defined as “the act of greeting or receiving the opportunity to become different.” HPO managers stimulate change by promoting self-awareness in the organization, which encourages people to reflect on whether they need to change, and by developing capabilities to actually be able to change and enhance flexibility. HPO managers are active leaders of change processes in the organization by being personally involved in transformations. Their leadership style adapts without difficulty if the change process requires it.
To begin welcoming changes, managers need to begin by setting explicit expectations and assigning responsibilities. If employees do not know what is expected of them, or who is responsible for other tasks, change will be slow or even resisted. The next step is to identify and clear roadblocks, including freeing up the resources needed, and install incentive systems that reward change in one’s own unit, as well as the whole organization. Finally, do not punish people if they weren’t able to achieve their own targets because they assisted in organization-wide change. This punishment will induce them to never again give their support to "the bigger picture."
6. Driving Performance
Driving Performance is defined as “having a strong performance orientation and a need to achieve results.” People in the HPO do not assume that success is permanent. They realize that nothing lasts forever, and therefore they fight complacency and challenge the current status quo, focus strongly on achieving the highest form of excellence in everything the organization does, and stimulate each other to achieve high performance. They have a strong discipline in execution, yet, at the same time, they know and expect that disappointments will occur and consequently develop resilience to setbacks. Due to this attitude, they will eventually accomplish the agreed upon targets.
Mikael Sørensen, a manager at Svenska Handelsbanken, described how they successfully drove performance: “Every month we make a ranking of the financial results that the branches have achieved. As long as branches show a continuous positive movement in the financial results, and thus move up the ranking, they are okay. The idea is, of course, for branches to get above the average. Every branch wants to be above average, they want to be in the upper half of the ranking and be better than their peers. So everybody moves continuously up, and this creates a real performance-driven culture.”
At its core, “Openness & Action Orientation” concerns the manner in which managers and employees interact in the organization. Improvement of these characteristics helps to develop trust in the organization and also creates the knowledge that is needed to practice continuous improvement.
How does your organization promote openness and action orientation?