Home Management Performance Management for Agile Organizations: Overthrowing The Eight Management Myths That Hold Businesses Back
Management Myth # 8—Employees Can't Be Trusted with Sensitive Information
Rachel received a phone call from an irate customer. “Your last invoice overcharged me on my telephone account by $149.90. I’m not happy about it and want it fixed straight away!” demanded Charlie Robertson, the fuming customer.
“Okay Mr Robertson, let me bring up your account details on my screen; I won’t be a moment, ” replied an anxious Rachel.
“Yes, there appears to be a mistake Mr Robertson, according to our records. I’ll need to talk to my manager about this and get back to you, ” Rachel responded, with a touch more confidence.
“Why do you need to talk to your boss if it’s obvious that you have made a mistake in your billing?” demanded Charlie, in an intimidating tone.
“That’s company policy, Mr Robertson, ” came the meek response.
Once off the phone, Rachel immediately went to speak with Margaret, her manager, about Mr Robertson’s situation. Margaret looked at Rachel and
Although today’s knowledge worker is exposed to more information—and has a greater expectation to be kept informed—there’s still a lingering attitude that divulging too much information to employees is counterproductive.
© The Author(s) 2017
T. Baker, Performance Management for Agile Organizations, DOI 10.1007/978-3-319-40153-9_11
said, after momentarily studying the information on the screen of her computer, “Obviously there is an error. Call Mr Robertson back immediately and let him know that we’ll credit him this amount in our next invoice. ”
Just as Rachel was about to leave her manager’s office, Margaret said, “Okay, let’s set a rule here, Rachel. From now on, if a customer calls and complains, and it’s obvious that we have made an error and it involves a sum of $200 or less, then I want you to fix it straightaway without consulting me. That way, were unlikely to antagonize the customer any more than necessary. I want you to show initiative in future under these circumstances. Okay?” Rachel called the customer back to reassure him. Charlie Robertson responded with, “Thank you, but I don’t understand why you needed to talk to your manager if the situation was obviously a mistake. ”
Rachel felt a little more empowered now, knowing that her boss wanted her to show initiative if a billing error in future was less than $200. Although feeling more confident, Rachel hoped that this kind of error wouldn’t occur again.
When it comes to sharing information, many managers operate on two false assumptions. They assume that employees can’t be trusted with sensitive information. These traditional managers believe that there is a high risk that employees will pass confidential information on to an inappropriate source outside the organization, such as a union. The belief is that managers are more trustworthy than employees with confidential company information. Management can, in other words, be trusted not to misuse information, but employees can’t. In reality, managers are no less or more trustworthy than employees.
There are, of course, many more employees than managers and perhaps with larger numbers, the potential for the abuse of this information is greater. But the idea that employees are less trustworthy is obviously complete nonsense. Harboring this false belief is not lost on employees; they know that withholding information from them is symptomatic of a lack of faith and trust. This assumption erodes trust levels even further and has a negative effect on the collaborative working relationship fundamental for cultivating agile behavior.
The second incorrect assumption is that information can be controlled by withholding it. This belief is flawed for two reasons. First, informa?tion vacuums are quickly filled with some sort of information—whether accurate or not—which can be more damaging than sharing the correct information in the first place. And second, social media puts paid to the idea that you can completely control the flow of information. People “talk” via social media. So instead of trying to contain information, managers should do the opposite; that is, increase the flow of information throughout the enterprise.
The only information a worker was exposed to on the Ford Motor Company assembly line—or any other company in the early part of twentieth century—apart from gossip, was work instructions. Specifically, this information entailed what was expected of the worker in performing their job. The boss didn’t want to confuse workers with anything that wasn’t directly related to their work. The familiar adage: “you’ll get told on a need to know basis” probably originated in this era.
Although today’s knowledge worker is exposed to more informa- tion—and has a greater expectation to be kept informed—there’s still a lingering attitude that divulging too much information to employees is counterproductive. It’s too risky; employees can’t be trusted with information that’s not job-related, is still a predominant belief. It’s certainly no coincidence that one of the biggest gripes employees have about management across nearly every industry is that they are frequently “kept in the dark”; they aren’t told what they ought to be told.
Restricted communication channels have a negative effect on the business’s capacity to be agile. Employees need exposure to more and varying types of information to know with confidence when, how, and why they need to be adaptive, flexible, and customer-focused. Even though knowledge workers have access to more information than employees 100 years ago, it’s still usually not enough to perform with optimum agility.
Taking stock for a moment; so far in Part II, I’ve suggested that employers need employees who:
But many of the antiquated performance management practices enduring from scientific management foster the opposite characteristics. Specifically, the principles of scientific management encourage employees to:
And as we cover in this final chapter of Part II, scientific management encourages closed rather than open channels of communication; yet another impediment to agility.
When it comes to information, the productive knowledge worker wants and needs:
For starters, the agile enterprise supports their workforce with a constant flow of information about organizational direction, market requirements, product and service updates, and new systems and processes. The spread of information enables the employee to be adaptable and enterprising at the right time, in the right way, and in the right place. Effective communication, in all its forms, “takes two to tango.” In response to helpful information, the employee is expected to show initiative; in other words—to be fully involved in the processes of decision-making in the business.
While the value of this exchange is well understood, adopting the practices to enable two-way communication entails a massive shift in thinking and behavior for many enterprises. The orthodox practice is to be selective about the type and detail of information shared with the workforce. You’ll be told on a need to know basis—is still pretty much the norm. In response to these carefully managed information channels, the average employee is understandably reactive and compliant. They do what they’re told.
Controlled information flow makes displaying initiative too risky. In a communication void, the employee is reticent to be enterprising. At the other end of the spectrum, having access to plentiful, accurate, timely, and useful information stimulates enterprising action.
I’d like to explore this link between information and agility further. There’s a commercial advantage in having open channels of communication. More decisions can be decentralized with a plentiful supply of information, particularly at lower levels of the organization (Chap. 2). Enabling more employees to make more decisions in more places in the business, eases management pressure; leaders can attend to strategic matters. There are employee advantages too; knowledge workers want and need autonomy in carrying out their work, as we covered in Chap. 8.
As I’ve said quite a few times in Performance Management for Agile Organizations, businesses profit from flexible, adaptable, and responsive organizational structures. These attributes are the product of a culture of shared ideas and information. It’s the opening—not restricting—of information networks that enables greater involvement from more people in all functions of the business. The agile enterprise is a dynamic organism, growing, flexing, and changing in response to the demands of its surrounding environment. This is in direct contrast to the staid, dull, corroded, and inflexible bureaucracy harboring restricted informational channels.
Pick up any book or article on change management and it’ll stress the relevance of information within and beyond the business. Authors like me love to write about the necessity of clear, frequent, and honest communication between employer and employee. This is because open information is a vital and widely discussed ingredient of a vibrant, healthy organization.
What’s more, there’s a renewed interest in participative values and practices. As business tries to come to terms with the hyper-competitive, “twenty-four seven,” VUCA market, it’s looking to involve everyone in solution-finding. But a more collaborative approach to decision-making only works with open dialogue between employer and employee.
Open communication has important consequences for attraction and retention, for instance. Top talent doesn’t welcome being told what to do; they want freedom and autonomy; they want to be proactive and part of the decision-making process. Attracting the right people and retaining the ones already employed, depends, as much as anything else, on the health of the employment relationship. And the state of the employer/employee relationship is dependent on the quality of internal communication.
All these factors I’ve covered here, legitimize a policy of open communication to fuel agile performance.
Where the rubber meets the road ...
Tapping into employee knowledge as the engine for growth
Manufacturing steel cans is a mature industry. Brasilata, the Brazilian company has figured out how to tap into employee knowledge and motivation to fuel its extraordinary productivity and innovation. It has won top industry and supplier awards almost every year, including the coveted Sherwin-Williams "Best Packaging Supplier" award. It has also been ranked among the 20 most innovative companies in Brazil, as well as one of the best places to work in that country.
Innovation drives change at Brasilata. At the heart of the company's business model is the Simplification Project (Projeto Simplifica^ao), which encourages all 900 employees across the company's four production facilities to think up as many suggestions as possible. "The Simplification Project
is like panning for ideas (incremental innovations), thereby stimulating the internal innovative environment and entrepreneurial spirit," explains Brasilata's CEO, Antonio Carlos Alvares Teixeira.
Ideas are so important that Brasilata employees are called "inventors," and everyone signs an "innovation contract" that reinforces their commitment to continuous improvement. After a slow start two decades ago (with only one idea per person each year), the company now receives more than 200,000 ideas each year—an average of more than 220 ideas per employee. Brasilata holds a party every six months, at which all employees celebrate teams and individuals with the best ideas. Employees are also rewarded with bonuses representing 15 per cent of net annual profits.
Some employee suggestions have sown the seeds of innovative products, such as an award-winning paint can that can withstand heavy impact when dropped. Other ideas have dramatically improved productivity. Some changes have made jobs redundant, but employees aren't worried. Brasilata has been able to maintain a no-layoff policy even during the worst downturns.
Brasilata's success is also built on teamwork. The company compares its workforce to a soccer team, in which winning goals depends on everyone. "Teamwork is one of the leading forces of the company," says the company's website. The company also emphasizes employee initiative and open communication. "In our opinion, innovative action is stimulated by a corporate environment where the communications channels are always open, new ideas are respected and errors tolerated."1
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