Delivering High Performance

The Third Generation Organisation

Douglas G. Long

• Publisher: Routledge
• Year: 2016
• Print ISBN:
  9781138279575
• eBook ISBN:
  9781317153337
• Topic: Business
• Subtopic: Business General
• Index: Business

Douglas Long is the author of Third Generation Leadership and the Locus of Control which focused on the new understanding of what influences individuals' values, world views and the behaviours needed to facilitate leadership fit for the future. Here, in Delivering High Performance, he concentrates on individual, unit and organisational performance when an organisation is using a Third Generation Leadership approach. Leaders constantly seek high performance and high levels of staff engagement; but achieving either depends on the competence and commitment of individuals or groups. The relationships between these factors are complex. Many people are competent to do things - they have the ability - but are not prepared to do them. They lack the willingness, confidence or motivation and the readiness to perform. You can even have the most committed and capable people in the world, yet still miss performance targets if there are issues with other factors impacting on performance. This book is a response to enquiries from those excited by the prospect of a Third Generation Leadership approach but who still have to grapple with performance issues - people who want to obtain and maintain high performing organisations. In that sense it builds on the new knowledge imparted in Third Generation Leadership and the Locus of Control. It is a 'How to ...' book that gives the reader practical tools that can be immediately applied and activities that can be undertaken in order to develop and maintain the required or even the desired level of performance.

1
Overview – Understanding the Full Performance Conundrum

Third Generation Leadership is all about a different way of achieving results. A high-performing organisation is one that is recognised for obtaining on-going desired performance through a highly productive work force. In other words, high levels of productivity and performance are the key indicators of a high-performing organisation.

One of the concerns I have about many management and political commentators is that, too often, we are regaled with ‘either/or’ type approaches that label people or approaches as being ‘left wing’ or ‘right wing’ (or something in between) and it is quite common to find advocates of any economic approach being influenced (either overtly or covertly) by their personal political orientation. We see this ‘either/or’ situation in every case where a writer or commentator denigrates any view that is counter to his or her own. Far too often this then degenerates into what is close to a simplistic approach of how we can fix the world’s ills through some form of either a modern socialism or modern capitalism that invariably focuses on relatively short-term time frames and which fails to deal with the increasing levels of ambiguity and complexity that are part and parcel of everyday life in this twenty-first century.

There is a recent example of this sort of writing in the UK newspaper, The Telegraph,1 when one of their writers, Janet Daley, accuses both the UK and the US as being complicit in ‘signing their own death warrant’ because of the dispute, in the US, regarding avoiding the ‘fiscal cliff’ and, in the UK, because of a failure to cut back on areas of social welfare including the UK’s National Health Service. She makes a very strong case for her position which, obviously, is very supportive of a strong capitalist view and she rightly points out that capitalism is dynamic and, by its very nature, does create inequalities of wealth. However the main thrust of her contention is that this dynamism means a strongly capitalistic society must be maintained as, in her view, this is the only way for economic survival. She argues that we are witnessing the ‘collapse of the most successful economic experiment in human history’ as though relatively recent successes (and the US-dominated version of capitalism has been extremely successful over the past 75 or so years) is the ultimate pinnacle of economic evolution. In that regard she is not totally dissimilar (although from a diametrically opposite perspective) to Karl Marx who argued that his version of communism would be the ultimate peak of economic evolution – and we all know that his approach was never proven to be an outstanding economic success and we all know how that experiment finished! Daley at least has historical evidence on her side and, unlike Marx who was arguing from a theoretical perspective, she has the strength of arguing from established fact. Of course there are writers just as strong on the other side (for example Jeffrey Sachs – see Chapter 6) who also argue that the current emphasis is failing but that rediscovering a moral base that contains elements of socialism – but not communistic – is the only way for economic survival.

Despite Janet Daley’s powerful and impassioned plea, the truth is that experience shows neither socialism or capitalism work when taken to extremes – the fall of the USSR some 20 years ago and the current economic woes of the US and in the European Economic Community (EEC) can both be seen as evidence of this. (Although those who are strongly capitalistic would claim that the failure in the EEC was caused by some form of creeping socialism rather than by the excesses of capitalism that brought about the Global Financial Crisis that started in 2007.)

Many years ago I suggested that we were moving to a new economic reality where we would be no longer living in either a capitalistic or a socialistic age.2 I argued that in this new age we needed to take a different approach to obtaining results – an approach in which economic success was critical but, which had its emphasis on both individual and collective economic success; which focused on working with people so that they were both engaged and committed in their work. This approach necessitates that the leadership of any and every organisation that seeks a highly productive work force must have (or be capable of developing) the skills to deal with increasingly large amounts of complexity and ambiguity. Such an approach requires that we manage (or lead) people in a different manner from what has been the case in the past. It requires, also, that we recognise the practice of leadership is different at various levels of an organisation – for example, as will be made clear in Chapter 6, board leadership is qualitatively different from executive leadership which, in turn, is different from managerial leadership – and until this is understood there is only a low probability of developing a high-performing organisation.

In all organisations, including nations, performance is the ‘bottom line’. High-performing organisations are those that can obtain this performance at a high level over protracted periods of time. But in this early twenty-first century, increasingly we are finding that the ‘tried and true’ ways of obtaining this desired performance are proving inadequate to the task. The result is that we see economic and social disenchantment leading to significant levels of unrest and political agitation against nations and corporations across the world in both the ‘east’ and the ‘west’. Unfortunately, all too often in national or political situations, the response from authorities is the attempted repression of dissent – and frequently this repression is exhibited in violent action causing death and destruction on both sides. In all these cases there are really no winners.

There has to be a better way.

I suggest that Third Generation Leadership provides some insight into a potentially better way – a possible way forward. Third Generation Leadership focuses on performance and looks at the role of leadership in bringing about this performance through commitment of those responsible for delivering what is sought. This new approach is neither ‘capitalist’ nor ‘socialist’ – it is simply a different way of leading at every level and in every area of an organisation – a way that facilitates engagement, personal accountability and high productivity. As I have said, these of course are the hall marks of a high-performing organisation.

However a Third Generation Leadership approach will threaten the status quo in relation to how organisations exercise leadership. That today’s approach tends to be confrontational with all the power residing in management is graphically illustrated by a 2012 report in The Sydney Morning Herald3 where people at the grass roots (‘labour’ as they are referred to in an almost derogatory manner) are told they may not sit down during working hours ‘unless their duties demand it’! Clearly the project involved is experiencing significant cost over runs but, as high-performing organisations know, high productivity seldom comes as the result of management fiat. Working with people – good leadership – is far more likely to achieve desired goals than is confrontation.

Fortunately examination of the role of leadership is receiving attention in a new way today. In the past the focus on leadership has often been quite narrow and sometimes focused almost exclusively on the attitudes and behaviours of leaders. Today we are finding that through a focus on the effects of leadership – the productivity of people and organisations – our understanding of leadership is evolving in a different form.

Recently (July 2012) Edward Lazear and Kathryn Shaw from Stanford University and Christopher Stanton from the University of Utah published a paper titled ‘The Value of Bosses’.4 Covering a period of four years (June 2006 to May 2010), Lazear, Shaw and Stanton were involved in studying the effect of ‘the boss’ in one very large service company. A total of 23,878 workers and 1,940 bosses (over a total of about 5.7 million worker days) were involved in the study and because of the nature of the work done and the records kept by the company with respect to general customer transactions it was possible to accurately gauge the impact of immediate leaders (‘the boss’) on productivity.

This research by Lazear, Shaw and Stanton indicated that the quality of immediate leadership provided has a very significant impact on productivity – in fact they argue that an immediate leader who is in the top 10 per cent of leadership quality increases a work group’s output by the approximate equivalent of adding one more person to a nine-member group – clearly a good ‘boss’ or leader has a very significant positive impact on productivity. They found that a boss in the top 10 per cent can increase a person’s output by 1.3 units per hour more than is the case with a boss in the lowest 10 per cent. In their research bosses averaged about nine direct reports and each of these people produced about 10.3 units per hour under normal conditions. This means that a good leader could add about 11.7 units per hour which is significantly more than would be obtained by adding an extra physical person. In other words, a good immediate leader can have a major impact on both work area productivity and overall organisational performance – something that, as indicated in the Case Study, became very obvious at Briysun.

For many years, of course, the matter of good leadership has been an on-going subject of research across the world. McKinsey’s, in October 2012, published a study by Professor Michael Useem5 of Wharton School, University of Pennsylvania. In this article Useem drew attention to the fact that, over a long time, the fundamentals of leadership – having a vision and a strategy to go with it and being able to communicate effectively and to make good strategic decisions – haven’t changed. Researchers and writers may discuss various ways of preparing visions and strategies; various ways of communicating effectively; and a range of approaches to effective strategic decision making – but they all agree that these elements or functions are vital. Useem makes the point that these all need to come together in a coherent fashion ‘for any role where you’re helping people to get to a more promised land’.

For me, the key phrase here is ‘helping people to get to a more promised land’ because this focuses attention on the issue of performance – leadership is about helping people move from where they are now to some better place. To do this it is vital that a leader has a vision, a strategy and is both a decision maker and a good communicator.

In Third Generation Leadership and the Locus of Control: Knowledge, Change and Neuroscience I introduce the Leadership for Performance model (Figure 1.1) to illustrate the complexity with which any leader or manager must deal if they are seriously interested in achieving performance targets.

The key things about this model are first, that I use the term ‘leadership’ as an inclusive term that makes no distinction between ‘manager’ and ‘leader’. The second key thing is that it shows the issue of obtaining desired performance targets from any person or organisation is vastly more complicated than simply the commitment and capability of the person or people involved. You can have the most committed and capable people in the world working for you yet still miss performance targets if there are issues in any of the other factors impacting on performance. Third, of course, it becomes imperative to ensure that there is a positive link between ‘performance’ and ‘productivity’ because a high-performing organisation must be one in which there are high levels of productivity at all levels. ‘Productivity’ accordingly means obtaining increased performance or better results through improved utilisation of all existing assets.

The challenge now becomes one of understanding and learning how to apply world best standards in setting performance criteria and implementing the process that has the highest probability of delivering these. As we shall see, the emphasis must be on ‘performance’ and the starting point for ‘performance’ is having a vision into which people can buy and the attainment of which is something to which they can become committed. Unless a leader has the ability to deal with increasing amounts of complexity and can find depths of resilience that perhaps he or she never really knew they had, then he or she will have serious problems – the probability of achieving desired performance will be low.

Figure 1.1 The Leadership for Performance model

These are the issues with which we will be grappling.

To understand this Leadership for Performance model, we need to return to Third Generation Leadership and the Locus of Control.6 In that book I wrote:

Those factors which directly impact on performance are the ‘ability’ and ‘willingness’ or ‘readiness’ (or, if you prefer, the ‘competence’ and ‘confidence/motivation’ or the ‘capability’) of the individual or group involved. It is important to note that these two factors of ability and willingness are related but totally independent. There are many people who are competent to do certain things – they have the ability – but they are not prepared to do them: they lack the willingness, confidence or motivation to do them – for some reason or another they lack the ‘readiness’ to perform. Again, this is not necessarily good or bad – for example all of us have the ability to do things that are unlawful: fortunately most of us are not motivated in that direction and so we can lead relatively quiet, law-abiding lives. On the other hand there are many people who will enthusiastically declare themselves willing to undertake any task even when they have no idea of how the task should be done or what the task involves. Such enthusiasm without skill has either the ...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Contents
• List of Figures and Tables
• About the Author
• Introduction
• Case Study: A $15 Million Productivity Increase in Two Years
• 1 Overview – Understanding the Full Performance Conundrum
• 2 Overall Organisational Performance
• 3 Unit/Department Performance
• 4 Team Performance
• 5 Individual Performance
• 6 Leading the High-performing Organisation
• Index