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Today’s ever changing workplace, features increasing speed, complexity and dense interdependencies. Over the last century, work has transitioned from labor intensive, repetitive work to today’s knowledge based economy.
Back in 1975, 83% of a company’s value was through tangible assets such as equipment, buildings and inventory. In 2020, intangible assets such as intellectual property and goodwill now make up 90% of a company’s value.
Twenty-first century work is no longer about how many widgets staff produce, but how well they make them together. Our economies thrive through idea generation, partnering and innovation from teams of highly skilled experts. Generating enormous value through leveraging digital technology and customer data, as well as developing algorithms, software, intellectual assets and brand value.
But how do you get people to work better together when organisations still operate in silos? How do you ensure there is trust consistency, so that employees feel safe, connected and share a future together?
I believe that there are three main factors that are all underpinned by trust which organisations must improve to be successful today.
1. Get Your Organisational Structure Right
The linear, hierarchical organisational chart of the past made sense when work could be planned and variables were stable. But today, it’s impossible to anticipate what resources are required and how to deploy them when work evolves as you progress. This requires teams that understand all the pieces of the puzzle and who are permitted to figure out how to organise themselves to work efficiently.
As General McChrystal says in the book Team of Teams, organisations must be networked, not siloed. This involves creating an inter-connected lattice of a team of teams to foster cross-silo collaboration, so that the insights of many teams and individuals can be harnessed across the organisation. Functional silos are no longer effective in an interdependent world that requires employees to innovate and solve tricky problems.
This requires a CEO, with the support of leadership, to create strong bonds across the organisation. Ensuring that every employee understands how everything works together through an overarching vision that every department can operationalise. Otherwise, silo thinking and working becomes the norm.
2. New Leadership Style
Technical skills are no longer enough. Things change so fast that what you knew last year is no longer relevant. Today's workplaces require leaders who have the right combination of technical, interpersonal (the ability to develop and maintain relationships and enlist others) and intrapersonal skills (self-management, ability to learn new things and self-awareness).
Traditional management techniques gum up the works in this new environment doing more harm than good. Today’s leader must empower people to do their best work in service of a shared goal. To enable real time innovation, leaders must foster the right environment for teams to thrive. Communicating, collaborating, interacting and thinking differently than leaders of the past.
This requires a leader who is people focused, rather than process focused. A leader, who learns fast, brings people together through their extensive networks; integrating and aligning the competing priorities and interests of other teams within the overall organisational strategy. A leader who clearly communicates how everything works together.
Central to this concept are leaders who know how to build trust among team members and with different stakeholders in dynamic conditions.
3. How Results are Measured
In the 20th century, standard management practice was to measure outputs to drive efficiencies in factories. Monolithic teams toiled in a hierarchical structure that was heavily process driven and predictable. Decision-making was centralised. Employees were poorly educated and not expected to think for themselves.
Now, the world of work requires highly educated employees working together to solve complex problems and make decisions. Results take longer to achieve. It requires leaders who can trust employees to do the work based more on achieving outcomes rather than clocking in and out at a certain time each day. Not only that, but with the rise of remote working, leaders have to trust that people are getting work done.
Measuring outputs are a relic of the industrial age that are no longer as relevant. They are also lag indicators, which provide information on how the organisation has performed in the past. While outcomes or inputs are lead indicators that shed light on future performance; providing guidance on what needs to be modified.
Lag indicators hide what is most revealing about the organisation, while lead indicators highlight what activities people are doing the the organisation to support future growth. However, lead indicators take time to solve and rely on two types of trust – faith that the strategy will work and trust that the team are doing the work to get there in the end.
Introducing behavioural metrics help leaders understand their part in building the company culture. Traditional accountability structures can unintentionally block team and collaborative behaviours. They also increase leadership blind spots and resistance to change getting in the way of progress.
Redesigning rewards and incentives that reward collaborative behaviours help circumvent unnecessary friction. After all, numbers don’t run a business – people do.
This requires shifting to behavioural metrics that ensure leaders are undertaking the right interactions with those around them. It’s not longer about “What results am I accomplishing?” but “How are we achieving results?”
Most leaders focus on what. Focusing on how ensures that success isn’t being manipulated through optimising revenue and expenses to match earning expectations. This can result in adversarial win-lose scenarios between team members, pushing them to compete against other lines in the business, take all credit for their performance, or burnout. It can be a major contributor of distrust in an organisation.
Building High Trust Cultures
Trust lies at the heart of every business issue. What starts as a people problem, becomes a productivity problem, which becomes a profit problem.
It is trust that shifts a group of people into a high performance team. It provides people with the security to explore the world around them. Inspiring people to commit to actions, make decisions fast and confidently buy into a big vision.
Otherwise, it’s like working in sludge. People block one another; require countless meetings to reach consensus and hoard information and resources.
And the only way an enterprise can adapt quickly to changing circumstances is if employees trust their leaders, team members, peers and their employer. This requires changing how work gets done, so that collaboration is supported in the organisation's architecture. This requires changing how departments collaborate and how leaders behave and get rewarded.