Michael Beer: Our research over the last 20 years has shown that there are six core silent barriers that block companies from high commitment and high performance. We call them the silent killers because, like blood pressure and hypertension and cholesterol, they can kill without knowing that they exist.
In organizations, everyone knows that silent killers exist, but the senior teams don't. The silence is up the line, not among people. If you ever had any experience in organizations, you know that people often talk around water coolers, behind closed doors, about what's going on the company and how it's managed and how it's not working properly and how things ought to be different, about the strategy, about the organization. Those messages never get up to the top in a candid direct way that they should.
The second thing that is necessary in high commitment is some learning and governance process. Just like strategic planning didn't used to exist in organizations, 25-30 years ago, I argue that for firms to create sustainable performance, they need a learning and governance system.
What is that? That is a capacity for leaders at every level to have an honest, collective and public conversation about the status of the organization. What its strengths are and what its barriers are. Revealed to the senior team, is the truth about how the system is currently working or not working. Unless you have such an institutionalized process in a firm, new leaders can take charge and ignore all the investments that have been made prior to them in keeping the performance going, in keeping commitment going. It's too easy for the firm to be up-ended by the silence about critical barriers.
Leadership and learning need to focus on changing and improving three core design elements in such a system.
One is the strategic performance management system. How does senior management convey its strategy? How does it create the appropriate sets of measures? Are those appropriate to just financial results? Or do they include other elements like the balance scorecard idea of my colleague Bob Kaplan? How do they follow up? How do they create strategic initiatives that are connected to the strategy? How do they monitor them? How do they create cross-organizational initiatives to enable the strategic intent to be carried out over time? How do they review this information? Do they focus on just financial information, do they focus on customers, do they focus on employees, do they focus on the contributions of the organization to a larger good? How are they brought in into a coherent system of examining how the firm is performing?
High commitment high performance organizations also continually adapt their organization design, how they organize and manage people based on strategic shifts. They don't hold on to one way of organizing because how you organize has to vary and change base on strategy. So, they are able to essentially manage evolutions and revolutions in the organization design. They actually avoid revolutions because they try to evolve the organization as necessary, and are able to do that through the learning process that I've discussed and gain commitment that way.
Finally, they have to have a set of human resource policies that essentially create the commitment, a kind of organization I've talked about.