Tyranny of 5%
Innovators and visionaries start the organizations while
managers shoulder the onerous responsibility of running it aground!! Sounds
unfair but look at it this way. Any organization starts with innovator or
visionary coming up with an idea that solves a need through some product or
service. Over a period of time it develops scale. Scene 2, enters the manager
who is supposed to manage the scale. Alas the poor guy does what he knows best.
Puts a strait-jacket around the organization, develops standard uniform
policies, procedures, HR Systems including performance therefore, ensuring that
only standardized/inflexible way of working is accepted or encouraged in the
organization. And any non-conformists who cannot adapt are free to figure out what
they want to do but only outside of the organization!!!!
Soon the poor manager realizes that this approach will work
in a static world but as luck would have it, today is different from yesterday
and tomorrow will be way different from today, and all this because of a guy
called Change. To make this worse, this Change fellow cares a damn about how he
is perceived. Like it or not he is there to stay. So the manager accepts the
writing on the wall and realizes that he and the organization too needs to
change to get along with this Change fellow. With the self-imposed constraint
of the strait-jacket, the only way manager responds to change is through
incrementalism.. Yeah, the same 5% improvement year or year that figures in all
performance goals. After all it ties in with what managers know and have done
all along. They encourage this incrementalism as way of life across the
organization and even through the industry bodies that they now pervade.
Appraisal system, promotion systems, they all are modified to ensure that only
incrementalists grow in the organization.
All this would work well if the innovators would also “realize” that all the varied needs that this world could possibly have, are met and stop innovating. But these troublesome people don’t. And soon comes a disruptive innovation that changes the landscape as managers have known it. Clients start demanding something that their organization is not positioned to deliver with their incrementalism and strait-jacket. But our indefatigable manager cannot be counted out so soon, so he throws in innovation as one of the goals to his strait-jacketed employee and expects customers to now stay!!
Poor employee wonders where to find time for innovation with strait-jacket of billable hours and 5% tightening and are lukewarm to the idea. And then something totally inexplicable (at least to manager) happens: customers start leaving first in a trickle and then in a deluge. Manager soon finds root cause of this in the employee and the cost of benefits and starts a project to cut both in an incremental manner.
It shows the impact on the balance sheet in the mid-term and managers and the board celebrate the victory of incrementalism. Thousands of options are offered to the righteous victor on quarterly basis leading to the transformation of “means” to end goal. “Rightsizing” becomes another incrementalist goal. Apart from the employee, nobody realizes that the core problem of customers leaving, is still there but amidst the celebration, nobody is noticing the elephant in the room. With proverbial Damocles’ sword hanging on his neck, employee too leaves for greener pastures. Few more quarters pass and balance sheet on steroid starts looking uglier and uglier. Analysts start asking tough questions and manager realizes that incrementalism has run its course in this organization, he then simply packs his tools of trade and leaves for another organization looking to build scale. And the Karmic cycle continues!!
