http://www.businessweek.com/articles/2012-08-06/how-excellent-companies-avoid-dumb-things

Management

How Excellent Companies Avoid Dumb Things


How Excellent Companies Avoid Dumb Things

Photograph by Erik Dreyer/Getty Images

I have worked with dozens of companies over the last 20 years, and I’ve seen more than my share of strange practices, large and small. You have, too. Why wouldn’t a CEO shut down a money-losing project even after it was apparent that it would never make money? Why would a bank mail customer statements to itself, rather than just not mailing them, when customers opt to get information only online?

In the course of my work, I made two discoveries about companies run by and staffed with highly intelligent people. The first is that there are employees at all levels of the organization with good ideas about how to improve all aspects of the business. The other is that there are eight barriers that keep those good ideas hidden.

I have never worked with a company that didn’t have all eight. But of all the eight, avoiding controversy is perhaps the most prevalent—precisely because it is such a common human behavior. Confrontation is uncomfortable, even for bosses and managers, whose job it is to make decisions. But this behavior is more than human—it’s also dangerous, because it can leave important issues unresolved, leading to confusion and inefficiency. Avoiding controversy is costly in every sense. When companies embark on an all-encompassing change initiative, it presents the ideal cover to deal with all these thorny issues because they become depersonalized.

If you can depersonalize a controversial issue, it gives leaders the chance to step up. The executive in charge of the money-losing initiative I mentioned above actually suggested that his project be shut down. He showed others that sacrifices had to be made and that there were no “sacred cows.”

Here are some things to remember about breaking this barrier:

• Dealing with a controversial issue can be a chance to lead by example. If you’ve been avoiding something, show people you’re better than the barrier!

• If you’re somehow the object of controversy, dealing with it will earn you the respect of both your peers and superiors.

• If you’ve been avoiding dealing with something, bear in mind that not dealing with it creates inefficiency and confusion.

• If you’re merely observing how others are avoiding controversy, bear in mind you probably don’t know the whole story. The CEO who wouldn’t shut down the money-losing project wouldn’t do so because it was the pet project of the COO. The CEO feared that shutting down the project would cause the COO to leave, and that would be more costly to the firm in the long run.

What decisions have you avoided making because you didn’t want to stir things up?

Neil_smith
Neil Smith is the CEO of Promontory Growth and Innovation, a New York consulting firm that helps clients increase revenues and reduce costs in innovative ways.

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