Managing Design 5-18-98

May 18, 1998 Design News

MANAGING DESIGN Tips on guiding product development

Developing employees for the 'new world'

Ted Gautschi Consultant Wellesley Hills, MA

Since the 1990s, emerging organizational norms directly contrast to popular, previously used systems. The old world before the 1990s relied on hierarchical, functionally oriented, command-and-control systems. Now we know these new world norms, although still forming, are heading towards flat, focused, flexible, and adaptive organizations capable of rapid responses to change.

Among other things, this trend has significant implications for employee practices, especially as they relate to hiring, education, training, and retention; to career paths, lifestyles and expectations; and to the stress of coping with continuing change.

The old charade. The old world employee activities often amounted to a charade, designed to let company policies appear rational, fair, and compliant with lofty corporate guidelines and policies. Since these activities were often disconnected from the organization's real work, they seldom elicited the employee's best effort, either to the company or to his/her own career path. In addition, morale and productivity drop when goals are not clear, priorities are not focused, and performance measurements are ambiguous. However, the old world business environment was such that it could tolerate ineffectiveness as long as the competition operated in the same way and relative stability provided some long-term employment security.

This situation is changing drastically. Most employees ("associates" is the new world term), especially those whose training, education, and work experience make them particularly valuable, tend to participate in organizations as "free agents" to the extent the economy will allow. They prefer self determination rather than committing their career paths to a particular firm where they are expected to follow rules and decisions to which they have little or no input, or where they seldom receive fair compensation in terms of their contribution to the firm's accomplishments.

End of micro-management. New world leaders cannot continue to micro-manage. Leaders alone will not generally tell associates how they are performing and what they need to do to improve. Such evaluations will result from participation in a 360-degree environment, involving the self-directed associates, their leader (acting as an adviser and coach), and their teammates. This must take place in an environment of mutual trust and confidence where everyone believes that identifying sensitive problems will not result in retribution or in being branded as a troublemaker. Instead, such evaluations will result in acceptance, recognition, and appropriate rewards.

Here are the ingredients for successful companies in the new world:

They will be the most adept at attracting, developing, assimilating, compensating, and retaining the talented people that they need.

• They will realize the importance of the soft stuff, like culture, change, motivation, and intellectual capital.

• They will learn how to engage their associates fully and not be satisfied to have them simply go through the motions of their jobs.

And they will use self-managed teams and decentralize their decision making as the basic principle of their organization's design.

Ask the Manager

Q: What are some of the factors that encourage workers to act as free agents?

A: Here are a number of interrelated factors that are usually considered:

The state of the economy, especially that aspect which relates to the business your firm is in, is an important factor. It is much easier to change jobs when there are too few qualified applicants.

• The degree to which you are gaining useful experience that will increase your market value is important, as is the degree to which your job develops according to your expectations.
  

• Timing is important. In the shaky job market of recent years, many workers decided to just grin and bear it. Currently, the technical job market seems to be very good. A recent Wall Street Journal article stated that the unemployment rate for electrical engineers is 0.4%.
  

• The degree to which the handwriting on the wall indicates you may be in trouble, e.g., small raises, no promotions, exclusion from major communication loops, major decisions concluded without your input, and outsiders hired for positions to which you aspire, offers such an incentive. Trouble may also mean that your company is losing ground with no relief in sight.
  

• You want to do something else with your life.
  

• The degree to which your firm still uses old-world hierarchical, functionally oriented command-and-control systems which do not encourage personal growth.
  

• You think the grass looks greener elsewhere.
  

• An opportunity presents itself. You have a chance to get in on the ground floor of a new and attractive business situation. Though risky, it could deliver a high payoff.