CEO Leadership: Break Down Bureaucratic Barriers

CEO

Every CEO should make it easy for employees to raise a red flag about issues and opportunities

True story: The Austin office of a large tech company once had six levels of management between its site president and the global CEO, who was based in another state. This separation was not only organizational and geographical, but cultural as well. News did not travel up the org chart very well, if at all.

Trouble came when corporate asked the Austin development team whether to create a new product or not. The group spent weeks gathering data and analyzing options. After extensive study, they produced a detailed report outlining why they did not think it was a good idea.

Six months later, word came down from above: Proceed with the product build. The team was flabbergasted and could not understand why the leadership did not heed their recommendation. However, being good soldiers, they went forward with the project and hoped for the best.

About a year later, the Austin site president visited headquarters and ran into the CEO, who began to grill him about the new product and why it wasn’t doing well. Finally the site president asked in frustration, “Why did you make us build it?” The confused CEO replied, “I didn’t make you build it. Your report said we should build it.”

The CEO found the report and showed it to the bewildered president. The report resembled the original from the Austin team, but various, subtle changes had been made along the way. As the report made its way through six levels of management, what had started as a “no” had become a “yes.”

Unfortunately, this chasm between leadership and those in the trenches is not unusual. However, the consequences of this old dynamic are growing more and more dire. Companies must move faster to innovate and adapt to dynamic market conditions. Consequently, CEOs must find a way to quickly and consistently harness information, opinions, and expertise from employees at every level.

The answer is to institutionalize whistleblowing. While the word “whistleblowing” may have a generally negative connotation, in this context it means giving every employee the means to raise a hand when he or she has something important to share – and making that information available to the relevant people, including the CEO. This could be anything from not having the resources to complete a project on time to seeing a potentially disruptive move by a competitor.

Great managers solve this problem by walking around and getting the pulse of their employees. As companies grow, this becomes a logistical challenge. There simply isn’t enough time to have conversations at every level of the organization.

At this point, leaders need to replace walking around with a system to solicit feedback about issues. This could be done via anonymous surveys and/or a system that regularly asks for employees’ perceptions of how their work is going, tied to their quarterly objectives.

Consider asking the question, “How do you feel about your work?” This tends to elicit more qualitative input than a status report, which is often comprised of historical numbers rather than forward-looking insight.

Whatever the feedback system is, it’s critical to consistently monitor the soft side, not just the hard data, of projects. Giving every employee a way to raise a red flag to management can help solve many problems before they become catastrophes.

Organizations can no longer afford for bureaucratic barriers to stifle their ability to pivot and grow. The combination of the CEO’s big-picture view and wisdom plus employees’ domain expertise and on-the-ground insight can be powerful stuff — but only if leaders find a way to continuously solicit and use the information.

This post is based on an article I published on Entrepreneur.com on January 27, 2017.

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