The latest issue of the Harvard Business Review (January/February 2010) includes an article titled “The HBR List: Breakthrough Ideas for 2010″. The first idea is one that really caught my attention, and it discusses what really motivates workers. In her research, Teresa Amabile, has discovered through a study that the most important thing that motivates employees is making progress. From the article:

On days when workers have the sense they’re making headway in their jobs, or when they receive support that helps them overcome obstacles, their emotions are most positive and their drive to succeed is at its peak. On days when they feel they are spinning their wheels or encountering roadblocks to meaningful accomplishment, their moods and motivation are lowest. (emphasis added)

I am not going to deny that progress is important when it comes to motivation. Any person would become frustrated if they continued to work hard, put in a full effort, and still not make any headway. Unfortunately, when that happens, it isn’t due to anything that the employee has done, it is a fault of the system and processes that the employee operates in.

I think the bigger key is the part highlighted in bold – it isn’t just making the progress that is important, it is that they are receiving the support needed to do so, and most likely, recognition for making progress. An individual can toil away in an organization, making progress but receiving no recognition or benefits from their hard work and success. In my opinion, progress will be motivating if the individual receives some type of gain from the progress, and it doesn’t necessarily have to be financial. Numerous studies have shown the important of giving and receiving simple recognition can improve attitude and performance. Employees want to be recognized for their effort and success. It feels great to know that you have accomplished something; in an organizational setting, it is even better for someone else to notice the progress and hard working you are achieving.

HT: Dan Pink

As you can see from the lack of posts over the last nearly 3 months, motivation has been one thing that has been lacking on my part. Yes, I’ve been busy with grad school, family, and work, but in reality, it comes down to motivation. It is obvious that if you don’t have motivation, then you won’t accomplish anything.

The same goes for organizations. In order to become as effective as you can possibly be as an organization, everyone from the top down needs to be motivated. And it has to be genuine motivation – not some fake, ra-ra crap put on at a ‘corporate rally’. In organization development, it is said that change won’t occur unless there is a felt need. The same goes for achieving an optimal level of effectiveness – the organization has to realize that improvements can and should be made, and individuals are willing to commit to make these changes a reality. That is where the true motivation comes from. It is a result of commitment to change and improvement.

Being the best – whether it is being the top firm in your industry or reaching a maximum level of effectiveness (which very well may lead you to the top of the industry) – takes work. People, and organizations, rarely make it to the top by luck only. It takes hard work. It takes effort. It takes commitment. And it takes motivation to keep working towards the goal. Tiger Woods has a goal in mind, and dedicates himself to reaching that goal and motivating himself to achieve his goals. The same should go for you and your organization. Set goals to improve effectiveness and stay motivated to achieving success and reaping the rewards of achieving your goal.

Working in the industry that I do (financial services), there tends to be an obsession with short-term performance. Look at the stock market – a company could be performing great for years, transform an industry, and yet they miss by a penny on an earning estimate and the stock tanks. The company is still healthy, still being a revolutionary leader in the industry, and yet because they came up a slight bit short of meeting a number that was determined by an outside analyst which really doesn’t mean anything, and yet the stock price takes a hit.

How did our world become so focused on the short-term? It has really become a “what have you done for me lately” culture that has gripped our world. Yes, to be successful a company needs to have some short-term success. But it isn’t the only thing that matters. Companies and individuals not only have to look at the short-term, but more importantly make sure that those short-term goals are aligned with long-term objectives. If what the company has set out to do in the short-term will not help achieve its long-term vision, it doesn’t matter.

This isn’t a view that is only for organizations – individuals need to take this view also in terms of their performance and development. Let’s, for example, look at the performance review. I’ve railed on about my annoyance with how performance reviews are handled. Managers need to not only look at what the individual has done in the short-term in terms of decision making, but also take a long-term view on whether the individual has improved their performance, knowledge, and skills from one year to the next. Short-term issues need to be handled immediately, so that it can help their development over the long-term in becoming a better employee.

Let’s get away from this short-term mindset. As an organization, what are you doing to improve overall performance and effectiveness over the next 5 years? Do you have long-term objectives, and if you do, are your short-term goals being used as stepping stones to reach those 5 year goals? Long-term performance and sustainability cannot be achieved by looking through a short-term windshield – you won’t see that cliff three miles down the road, and you won’t see a long-term trend of improvement.

In organizational theory, there are three primary approaches to measuring effectiveness in an organization:

1. The External Resource Approach is used to evaluate the organization’s ability to secure, manage and control scarce and valued skills and resources.
2. The Internal Systems Approach is used to evaluate the organization’s ability to be innovative and to function in a quick and responsive manner.
3. The Technical Approach is used to evaluate the organization’s ability to convert skills and resources into goods and services effectively.

I don’t necessarily believe that one approach is better than the other. In reality, an organization should utilize all three approaches, as they each have a different focus. For example, taking a strictly external resource approach could lead to too much focus on stock price and market share, and lead to inefficiencies and missed market opportunities that would have been discovered using a technical or internal systems approach.

Wrapped around all three approaches is the use of goal setting. Each approach and their measures used should have attached organization goals. For an external control approach, one goal might be to reach a market share of 30%, or reducing material costs by 10% for the year. An internal systems goal might be to bring a new product to market every 6 months, or to reduce the number of people required to make a major decision. A technical goal could be to increase the number of widgets made per day to 50, or to increase client satisfaction by 5%.

The key is to not let your organization measure effectiveness using one approach. A truly effective organization will utilize all three approaches, setting goals that fit into each category and measuring its performance against those set goals.

…You have to study them and discover them to really understand.

In double-loop learning, the individual must question the assumptions he is operating under when making decisions.

When studying organizational culture, the change agent must question and discover the assumptions underlying the culture to really understand what is going on.

In order to really learn, to really understand the world around us, we must continually question the assumptions that we operate under. Often they are outdated, incorrect, and just plain wrong. So if that is the case, then how can you make correct decisions, especially those of critical importance? One must understand, question, and validate their operating assumptions when making decisions within the organization. Even the organization as a whole, when looking at its operations and strategy, must question their assumptions concerning the economy and marketplace in order to make a wise decision.

There’s a reason that old saying has become a part of our language.

While I have no problems with the content of this article from Harvard Working Knowledge called 10 Reasons to Design a Better Corporate Culture, I do have an issue with the title.

Cultures aren’t designed. They aren’t like a car, or a shopping cart. You can’t just design and create it, and then built it to specification. Cultures grow and develop over time. They are living, growing, developing, and constantly changing.

The management of an organization should take proactive steps in nuturing the creation of a strong, supportive corporate culture. But, in the end, it is up to the overall constituency in the organization to accept and take hold of this culture. Management can spend their time creating public ceremonies, or workplace rules that foster creativity, but in the end, it is up to the workers of the organization as a whole to accept the culture as a shared experience.

Edgar Schein defines a corporate culture as

a pattern of shared basic assumptions that was learned by a group as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems. (Organizational Culture and Leadership, p. 17)

A culture is learned. It isn’t designed by managers and leadership. It is created through a shared learning process by the organization as a whole as they work to solve problems. If you think that you can walk in and design a culture to fit your liking, then I would suggest you head back to the drawing board.

Knowledge @ W.P. Carey has an article about the importance of water cooler talk:

It is an idea that Ashforth advances under the banner of “tribalism” in a chapter he authored for the forthcoming SAGE “Handbook of New Approaches in Management and Organization.”

After all, says Ashforth, a pack of paralegals or a covey of consultants drinking java or hanging about the proverbial water cooler is not so different from a tribe of Neolithic hunters sitting around a campfire. We as a species have come a long way since the days when the morning commute meant braving saber-tooth tigers but, at our core, people are still very much the same social animals we’ve always been. We want to feel like we belong and we value our closest connections beyond people we don’t know.

In a very real sense, organizations big and small would benefit by seeing themselves framed by a variation of Former U.S. House Speaker Thomas (Tip) O’Neill Jr.’s maxim, “All politics is local.” People care about the big issues, but place a very large importance on whether the potholes on their street are fixed and if there are jobs to be had in their town. So it is with organizational culture: The big issues matter but employees are most likely to judge an organization by their most local contacts — their boss and immediate coworkers.

Ashforth says an organization’s success is largely linked to its smallest social units, the tribes who congregate around the coffee maker.

Ashforth does make a worthwhile point about the connections made and the translation of higher-order communication to the lower level, he neglects to mention the downside of such talk: office gossip. Every office has it, and I rarely ever see it as a positive. Generally, the gossip is negative in nature and really doesn’t do anything to benefit the organization. I don’t really see the groups that gather around the office as tribes…I think they more resemble packs of hyenas looking for tidbits of news to prey on.

I like to think that a person can be a leader at any level of the organization. Those at the bottom, the middle or the top or anywhere in between can be a leader for the organization and their groups. The difference is how you lead. When you are at the top, such as the CEO, you have more power to lead through verbal communication. You can make bold statements, outline a vision and rally the troops to follow along. When you are at the bottom, however, this most likely won’t work. You’re more likely to have a bunch of people looking at you in a funny way, saying something along the lines of “who died and made you king?”.

When you are at the lower levels of the organization, or not in a formal leadership or management position, the best way to lead is through your actions. People will take notice of how you act and what decisions you are making. If your manager is good, and you work for those who are observant, you will be notice and recognized. People will be more likely to follow along and act in the same manner if they see you getting ahead by doing the right thing. Especially if it comes to a change program, your actions can speak louder than words. If people see you being a champion through your actions, they will be more likely to jump on board as well.

Leadership is about communication – and the method used to communicate will vary by your level. You non-verbal actions will say a lot about you and what you believe.

I’ll be honest – I don’t like performance reviews. There are so many things that I see wrong with them, and how organizations don’t use them to their full capacity.

First, getting a review on how you are doing once a year doesn’t cut it. How are you supposed to improve during the year? How do you know what you are doing wrong if you are only told once a year? Managers too often rely on the annual review to actual work with their subordinates on improvement and what they are doing wrong. It is the incorrect way to approach the situation. A manager should tell their employee immediately if they are doing something wrong, so they can fix it and work on their improvement. And what are the chances the manager is going to remember from the past year all of the bad and good things a person has done? They won’t. Reviewing performance should be a constant thing. Work with the employees to let them know what they are doing wrong, and work with them to fix it. Use the annual review to look at the things that need to be corrected, and what the employee has done to fix them.

Second, performance reviews all too often focus on the negative. I wrote recently about focusing on the positive. I think performance reviews should look at what the employee is good at – what their strengths are, and use those sessions to helping the individual improve those strengths. How many times in a performance review have you been told what you’ve done right, or what you are good at? And how much of the time focused on the positives instead of the negatives? Everyone has strengths. It is up to the manager to discover their subordinates strengths and put them to work. Obviously, you can’t focus just on the positives. If an employee has a behavioral issue, that needs to be dealt with right away. Or if they are lacking a skill needed to do their job effectively – that needs to be addressed through training. But also look at the positives, and what the employee is good at, even if you discover their strengths aren’t suited for their current position. It will improve them – and yourself and your organization – in the long run.

Third, use performance reviews as a session for planning your development. It is in your benefit as a manager, and to the benefit of the employee, if you work together to develop a plan for developing a person and helping them achieve their career goals. Talk about what interests the employee, what their strengths are and what they should focus on, and talk about the additional training necessary to help them reach their goals. Set goals for the upcoming year, and make those goals meaningful. Don’t set worthless goals such as “generate 50 more TPS reports each quarter”. That isn’t improvement. Improvement is personal and focuses on your strengths. Set up a plan of what to focus on the upcoming year.

Poor management and stifling corporate policy gets in the way of making the performance review process useful. Make it a continuous process that focuses on the employees strengths, behavioral modification needs, and planning for their development.

I view organizations like giant puzzles. There are many pieces involved, all uniquely shaped and designed to fit in a particular place. In order for the whole picture to look right, every piece has to be in place. With an organization, it won’t look – or function – right unless all of the pieces are in place.

Take an automotive engine. Consisting of many moving parts, each one which performs a different function. What happens if one of the parts is missing? Or is installed incorrectly? The engine won’t work. And neither will your organization. A crankshaft won’t do its job if it isn’t the right size, or isn’t designed to work with the engine. Which part of your organization is an incorrect crankshaft?

Nadler’s Congruence Model of Change is all about the fit:

This concept of fit is crucial to understanding the organizational model I’ve been describing. In systems the interaction of the components is more important than the components themselves. In terms of the organization, its overall effectiveness relies on the internal congruence, or fit, of its basic components. The tighter the fit, the greater the effectiveness.

…

This, then, is the essence of the congruence model: the greater the congruence among the internal components, the more effective organizations will be in transforming their strategies into performance.

In my post about what an effective organization is, I mentioned the importance of delivering on processes and achieving stated goals. Nadler reinforces this message: if the parts of the organization don’t fit, you won’t be able to perform at the highest level – and thus, won’t be able to fully deliver on your processes.

Take a look at your organization. Does it resemble a puzzle after a 3 year old has gone through the box? Or like a haphazardly designed engine? Make sure the parts fit – don’t try to shove that square peg through the round hole.