There is a myth being propagated by pundits lately, that you either have to cut or grow. But the truth is you can’t do one with out the other successfully
In many countries and companies across the globe the economic crisis has caused a rash of austerity measures to attempt to right crashing economies. There is no doubt that this is necessary are vital as an immediate stopgap, but it is not a long term solution. But, unchecked growth alone is not a recipe for long term success either. Rapid growth is awesome, but when it is unchecked it can lead to shoddy process, products and service.
ALL THINGS IN MODERATION
As with all things in life, there must be balance. In prosperous and lean times, it is critical for organizations both be thoughtful about
COSTS, EFFICIENCY AND PRODUCTIVITY
• Organizations must be mindful at all times about how and where money/resources are “spent” (grab reference to constant planning). This is one the most powerful uses of Lean or Six Sigma in an organization. Tools and methodologies like that are most useful to hone and streamline. They are not methods to cut cost necessarily, but will ensure lower costs and higher productivity over a long time horizon.
• Organizations need to reward GOOD usage of resources. There are thousands of companies (and governments AND non-profits) that budget like spoiled children. Amazingly, if a team or department is fiscally responsible, gets everything they accomplished, and comes in under budget they are rewarded by getting a LOWER budget the following year. WHAT?!?! Hence the reason that organizations try to spend money like drunken sailors before the end of their fiscal year. That does not make sense.
• Get help from employees – Companies like Well Fargo, SAS and the Container Store regularly implement employee ideas that reap HUGE benefits. None of them have “employee suggestion” programs. They reward great ideas by allowing the employees to lead (or be a part of the) project to implement the ideas!
BUILD, GROW AND PROSPER
• Ensure that there are new products and services coming down the pike all the time. There is a great blog by the new CEO of Yahoo Marissa Mayer that shows us there MUST be energy focused on innovating and creating all the time.
• Every single employee MUST understand their Line-Of-Sight –
◦ The “straight line” that every employee has to gaining and retaining customers.
◦ According to the Coffman Organization’s latest research, providing employees with this knowledge allows them to see and understand their impact. That increases the feeling of meaningfulness of their work and directly impacts their productivity.
• Growth must be pushed all the time, regardless of the economy. Only losers use the economy as an excuse. There are hundreds of examples of companies that did well during the recession. Some were disruptive and others doubled down when they saw their competitors pull back.
◦ Apple
◦ Redbox
◦ Ralph Lauren
It is imperative that organizations look to both cut fat and gain muscle ALL THE TIME. This way, the organization can anticipate shocks, recover from missteps and capitalize on competitions faltering.
Do you agree that leaders should have a balanced approach making sure organizations thrive? What are methods you have seen work well?
Anil Saxena is the President of Cube 2.14, an organizational development consulting firm that works with clients to increase both customer and employee engagement while decreasing turnover, improving customer retention, and increasing profitability within organizations.
Saxena is a certified High Impact coach and trainer and a Joint Application Design facilitator. He is also certified by both Rush Systems and IBM as a focus group facilitator. He is an inaugural member of Northwestern University’s Learning and Organizational Change program, and he earned his bachelor’s degree in mechanical engineering from the Illinois Institute of Technology.
