Where is the Hidden Potential in Your Organization?

Imagine yourself leading the operations division for a national energy company.  Reporting to you are 10 general managers in charge of 10 independent plants spread across the Eastern United States.  Each facility is unique and is operated as a separate profit center.  Each manager runs their own shop. 

Over the years, you have successfully placed and groomed these general managers to be effective, independent leaders, and the strategy has paid off.  This year’s pretax income across all facilities should hit 100 million dollars. 

But the winds of change blow from all directions.  New business models are sweeping the industry.  Competition and regulation are threatening future profits.  And Wall Street’s expectations continue to soar. 

You know your division must step up performance to an even higher level.  But you feel that each individual plant has been squeezed dry – that little will be gained by challenging individual leaders.  At the same time, you know that much greater potential exists in your organization.  You are convinced that the group is capable of so much more.

So where is the hidden potential?  And how do you tap into it?

Reaching Across the Boundaries

I was called in to help with this situation 18 months ago, and it reflects a phenomenon I am seeing more and more frequently across the business landscape: 

1)    An organization has enjoyed historical success;

2)   Talented leaders are in place, thanks to thoughtful leadership planning and development efforts;

3)    Sudden, dramatic industry or market changes threaten to knock the organization off balance; and

4)    The business seems tapped out.  Intensive, even heroic, efforts fail to generate much lift for the organization.

In these cases, we must move beyond our traditional tendency to look inside individual leaders for stronger performance.  A much greater opportunity lies hidden in between leaders and the groups they lead.  This potential can be unlocked only by reaching across the boundaries that separate our most talented leaders from one another.

The leader of the operations division described above knew that the secret to success would involve bridging the gaps between his independent operators and their facilities.  This would be no easy task.  Although they called themselves a management team, they were by no means a real team.  And the case for greater teamwork was difficult to make.  Even the division leader could not pinpoint areas where greater collaboration would lead to specific payoffs.  He was operating on experience, guts, and faith.

Increasing Connection, Understanding, & Accountability

Unleashing the hidden potential required increasing three vital elements across all general managers:  Connection, Understanding, and Accountability.

1)    Increasing Connection:  Through a long and intensive process of offsite meetings and teambuilding adventures, the group of independent operators began to explore and tear down the walls that separated them and their business units from each other.  They gradually built enough trust in one another to buy into a radical idea:  They would treat their resources and profits as a single, shared portfolio rather than as 10 separate profit centers.   

2)    Increasing Understanding:  Although trust had grown over time, the managers remained blind to key improvement opportunities because they did not understand each others’ operational challenges.  So they came together for two days to put their budgets in common view for everyone to see.  They lifted the curtains which had hidden their operational secrets from one another, with the goal of finding opportunities to cut redundant expenses and capitalize on shared income opportunities.  For the first time they looked at how their operations mapped together as a single business, and they began to understand possible interdependencies.  They walked out of the room with $8-10 million in new opportunities to enhance the next year’s bottom line.

3)    Increasing Accountability:  The initial payoff represented scratching the surface of a much greater opportunity.  The budget meeting was a first concrete opportunity for managers to begin translating their talk about teamwork into specific deeds.  As they prepared to travel home to enlist their business units in the major changes ahead, the group wrestled with the concept of accountability.  How would they communicate and connect on budget issues going forward?  How would they coordinate initiatives and measure progress?  How would they promote collaborative interaction across their organizations? 

Babe Ruth said “You may have the greatest bunch of individual stars in the world, but if they don’t play together, the club won’t be worth a dime.”  The same can be said of any large business.  Having an organization full of talent is not the same as having a talented organization. 

I have found that attention to three areas – connection, understanding, and accountability – provides a helpful framework for organizations of any size to build stronger collaboration across territories inhabited by talented leaders and groups.  Though not easy, this is one sure way to unlock the tremendous power for performance and growth that lies dormant in your business.    

Transcending Tribalism:

What To Do When Unhealthy Competition Undermines Performance

A Managing Director with a local investment banking firm had reached the end of his rope when he called me for a consultation. 

“John, you have heard about our reorganization,” he began.  “My team here in Charlotte has merged with 2 other groups from two other cities.  We came together with a lot of overlapping responsibilities and client relationships.  And we’ve been trying to get a handle on who’s responsible for what.” 

“But in the past few weeks the wheels have come off.  Instead of focusing on the huge opportunity for our overall business, the teams see each other as threats and competitors.  Each city sees the others as inferior, and no real communication or collaboration is happening.”

“Now some big deals have stalled because of turf issues – people are obsessed with who gets credit, or with who owns this or that client.  This is not how we used to operate, but we’ve slipped into rivalry and we can’t break out of it.   I’ve even hit a wall in working with the other two senior guys.  We have critical decisions to make and can’t seem to agree on anything.”

I recognized the symptoms all too well. This firm was caught up in an internal cycle of US versus THEM behavior called “Tribalism.” 

Tribalism occurs when group members so closely align and identify with their own unit that they see other groups or parts of the organization as competitors, obstacles, or threats.

Based on my work with hundreds of leaders from many different organizations over the years, I can report that tribalism is alive and well. And the financial and emotional costs are high.

The irony of tribal behavior is that it is rooted in one of our most positive human qualities–an ability to identify closely with others and to form strong bonds of trust and loyalty within our families, peer groups, and work teams.

But the darker side of this tendency is mistrust and even hostility towards outsiders – perhaps those from different locations or levels, with different roles and interests.  

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When has Tribalism Gone Overboard?

I often hear executives refer to cross-boundary rivalries in their companies as if they have accepted them as a fact of business life, like a permanent background noise.  It’s as if they account for these hostile conditions as a cost of doing business, in the same way that they account for the existence of telephones, computers, and office space.  Eventually, in most cases, they reach a point where the “noise” becomes too loud and the cost too great to ignore. 

How can we recognize when healthy team spirit and friendly competition among groups has descended into unhealthy tribalism – a kind of internal warfare which blocks growth and progress?   If you are in doubt as to whether tribalism has begun to threaten the long term success of your business, consider the following questions:

·        Are your customers experiencing gaps, errors, or overlaps in service due to clumsy internal coordination?

·        Are your key managers focused on beating each other rather than beating the competition?

·        Are important new business opportunities unexplored or untapped because of poor communication and collaboration across departments?

·        Is accountability for problem-solving fragmented, where no one can “get their arms around” problems which cut across departments?

·        Do employees blame and point fingers across groups (sometimes in front of customers) rather than take accountability for improving the situation?

·        Is tension across parts of your organization hurting morale and causing talented people to leave your organization?

If you answered yes to at least half of the above questions, I recommend developing a strategy and taking steps to intentionally strengthen collaboration across the business.

Here are a few key guidelines that I urge leaders to keep in mind when tribalism threatens:

The above guidelines will help you jumpstart your organization when two or more areas are polarized and paralyzed by conflict.  Once things are moving in a positive direction, take time to more thoroughly evaluate your business as a whole for factors which impact coordination across teams.  These include clarity of business vision and strategy, organizational structure, compensation and rewards, talent development, leadership practices, information technology, among other factors. 

Finally, it’s important to approach this topic as an ongoing process of improvement rather than as a one-time event.  All organizations (and all of us) carry a kind of muscle memory that governs how effectively we work together across group boundaries.  We will not retrain these muscles overnight, but rather through continual, focused (and sometimes painful) effort.   

John Bradberry is a Charlotte-based business consultant who specializes in executive development and organizational growth.  He will co-lead a day-long conference on “Transcending Tribalism” September 12, 2001 at The Ballantyne Resort.   

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