With executives under fire for driving their companies into the ground—and taking the economy with them—it's time for a managerial paradigm shift that focuses on the root of all booms and busts: individual behavior. Many time-honored management practices, such as layoffs, yearend bonuses, and automatic pay raises, actually reward employees' bad habits and punish good behavior, often with devastating results.
These practices stem from theories of performance that have little to do with the science of learning. As such, they result in many mistakes initiated by senior leadership at great cost. They're endorsed for the best of reasons but fail to lead to the desired result.
So why do so many organizations continue to embrace faulty practices? My 30 years of experience with Corporate America have led me to believe most business leaders are trained in the math of balance sheets, not the science of human behavior. They don't understand that you can't change organizational behavior without changing human behavior. Only when managers understand the basic principles of behavioral science and apply them skillfully will they realize the full potential of their employees and their organizations.
A Chance for Change While management in general is proving challenging today, there is a silver lining to this current economic crisis: It provides a rare opportunity for managers to rethink and reform the way they run their organizations, using an approach grounded in science and research rather than in dubious habits. Businesses have been wasting time, funds, and resources on the same tired approaches for years. This crisis can actually provide us with a chance to start fresh and set in motion a sea change in the way we manage behavior and performance.
Please see a slide show featuring 13 universally used, but ultimately ineffective, management practices—and prescriptions for how to change them.
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