Thursday, May 1, 2008

The All-Too-Common Mis-Practices of Handling Employees

I am no longer surprised when I see overt management inconsistencies. I am not surprised when I see how typical management mis-handles employees. So I guess I shouldn't be surprised when I see that they can't see it themselves.

Jeffrey Pfeffer makes a comment in his brilliant book, The Human Equation, a book about building profits by putting people first. Pfeffer writes:

". . . what the available data do portray is [the typical company's] unplanned, haphazard management of the employment relationship. This ad hoc character of managing people must certainly negate much prospect of achieving profits through people."

It is in this very reality and the inconsistency it produces which serves as the unfounded excuse for the typical and untrue belief held by most of our American business owners. - "Our company can't make more money through better people practices."

It makes simple and stupid sense. We don't know what to do to improve our worker conditions or alignment for productivity, so we safely assume we are doing the best that can be done. Whatever our results, we assume that it is the best our people can do. Since we manage our businesses through the lagging indicators of our financial statements, we also assume that any financial improvements must come as the result of some financial or structural change engineered from our expert management.

I saw this very clearly in Business Week surveys in 2006. Business leaders reported that their greatest concerns involved finding and keeping enough quality people to carry out their important business objectives. This makes sense. However, when asked which systems they felt were developed and in place to carry out those critical objectives, people systems were the least developed, well behind financial systems, or marketing systems.

I asked a lot of executives, business owners, and entrepreneurs how it could be that the most critical success factor for all the surveyed companies had the least developed systems.

I got few credible, thoughtful answers. I began to suggest that the comment about needing quality people might just be nice sounding rhetoric. That is way too shallow and simplistic.

Out of the few answers I did get, I was able to form my own, credible, thoughtful answer. Business owners actually don't know what they need to know, or do, to strengthen their workforce, and they don't want to admit it. So, instead of acknowledging the weakness, and pursuing a new-model solution, they simply ride the gravy-train of their common ignorance, and go on as if it really doesn't matter. "Nobody else I know is doing anything much different than what we are doing." Sounds like a plan.

It's the comfortable curse of common practice. It's the curse of common ignorance. It's the fuel of comfortable mediocrity. And, sadly, based on the survey results, and on my experience, I'd say it's an almost universal phenomenon.

So, as long as most everybody else doesn't get it, you can feel safe. There is safety, at least a little, in numbers.

You won't feel so safe, however, when your competitors break from the pack. Then those upstarts will steal your best people, then your best customers, then they'll come after your business. Then, you'll need to look out, and you probably will. You'll start to look for help to develop your people systems. But, by then it might just be too late.

Think about it.

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