Is the “new normal” a catalyst for change?
Many years ago I was interviewed for a job by the CEO of a medium-sized manufacturing organization. I will never forget my first impression when I entered the boss’s expansive office with its large mahogany desk, a desk that was deserted. An ocean of polished timber, but for a single sheet of paper.
As we settled into the interview I gained sufficient confidence to ask how such a busy person could run a business with such a clear desk.
The answer was simple:
“I have great people and I know what every manager is doing in great detail. It’s reported to me weekly, it’s all on this single sheet of paper.”
“You see I run my business by the Principle of Contradictory Reporting and use ‘OK monitoring’ with ‘Exception reporting’”.
You too can delegate and trust self-reporting without hesitation
The COVID -19 virus has meant that many people are now working from home. The potential benefits of remote working are well understood, though to date the uptake has been slow, possibly because of the old school management thinking: ”if I can’t see you working, how do I know what you are doing?” Of course, in today’s world, this is ridiculous. Where people are is of little consequence, what really matters is what people are achieving.
To better understand this we need to look, not at the job title, but instead the job function.
For example, if you operate a factory your job title may be “Production Manager”, but in fact your real job function is to make products or perhaps: “To make the most of the best for the least”. Clearly, the key deliverable is output.
With this key deliverable in mind, all we really need to do to monitor production is the measure and report output. Obviously, of course, we also need to monitor a subset of perhaps three or four parameters to ensure the key deliverable is not being met at the expense of other vital parameters.
The output is therefore the first or primary measure or KPI. However, output can possibly be achieved at the expense of quality and so a measure of quality or defect rate would also be an appropriate contradictory report.
High output can also be achieved by making production staff work at a frenetic pace thus creating an unpleasant environment with a consequent high staff turnover. Perhaps therefore we could also monitor staff turnover as a measure of production performance.
Output can also be achieved by excessive overtime or headcount, so perhaps these can be measured as well.
Thus it can be seen that for the Production Manager the reporting points may be:
- Output
- Quality
- Staff turnover
- Headcount
- Overtime
Each of these KPI’s can be shown as a simple line or graph going forward for the next period, perhaps 6 to 12 months, with timely reports above the graphed line showing you have exceeded the KPI, or below the line, you have failed. By creating such a set of contradictory reporting points the manager is essentially forced to operate within a framework where all variables relate to all other variables.
“Exception reporting” occurs when a dot appears below the line, in which case, you can expect an inquiry from the CEO as to what has gone wrong. “OK Monitoring” is when the dot is above the line, in which case all is OK and no call from the CEO can be expected.
With such metrics in place and the reporting now just a dot on a page the CEO can assess the performance of the production department at a glance.
The same principle can be applied to all job functions. For example, a sales manager’s primary task is to sell products. Therefore the primary KPI is sales, either by volume or dollar amount. Subset KPI’s may include, discounts allowed, sales staff headcount, advertising spend and so on.
By adopting such a reporting arrangement it can be seen that the organization can be effectively monitored with simple reports and little need for face to face interaction.
So what has COVID-19 consequently taught us about remote working?
Perhaps it has taken the COVID -19 crisis to create the environment for change and remote working. Let us hope we can now embrace this approach and a simple one-sheet reporting mechanism that allows your desk to remain clear so you can focus on the real task, not of running the business, but building it.
By contributing editor: Roger La Salle - CEO of Innovation Training www.innovationtraining.com.au www.matrixthinking.com
