What’s the most powerful invention in history: the printing press, electricity, the automobile, the telephone, the internet, or something else? The question could be debated endlessly, but there is one answer that most people would overlook. Question: What do you call a farmer with a long stick? (I know it sounds like the beginning of a joke, but it isn’t.) Answer: The inventor of leverage. And leverage is among the most powerful inventions in the history of the world.
One day a farmer was in the field and there was a huge rock in the middle of the field. He tried to lift it, but it quickly became clear that he was not going to be able. He tried to push it, but that turned out to be useless too. He stood there looking at the rock for a while, and then he had an idea. So he picked up a long stick, wedged it under the rock, applied pressure to the stick, and was able to move the rock. He invented leverage.
Leverage is one of the greatest inventions in history. We use it in thousands of ways every day to make our lives and work easier and more efficient. The six immutable principles of a Dynamic Culture are a form of leverage. They provide cultural leverage.
Systems are the great-grandchildren of leverage, maximizing it. Organizations everywhere leverage systems to maximize efficiency in so many ways, and we have become so used to them that we either don’t even recognize them or we take them for granted. The leveraging power of systems is so great that some of the most successful organizations in the world have been built on them. Is McDonald’s a business or a system? It’s both. Can you make a better burger than McDonald’s? Probably. I know I can. Can we make them in 100 countries, at 35,000 locations, serving 70 million customers a day? No, we can’t. Like McDonald’s, we would need more than a million employees and a highly refined system. Franchising is leverage. Franchising leverages a system to multiply what is possible on one corner in one city and makes it possible on corners in every city.
Simply measuring something is a system. What do you measure in your organization? Why do you measure it? When did you start measuring it? Does it still matter? What you measure sends a message. It tells your team these are the things that matter the most. Systems focus people. Is it important to measure things? Yes. But are you measuring the right things? Are you sending the right message and driving the behavior and outcomes you desire?
Systems are a form of communication, and a very powerful ally in the art of overcommunication. They are also one of your best friends when it comes to building a Dynamic Culture, creating clarity around mission, and empowering your organization to execute a Strategic Plan so effectively that they surprise themselves.
Organizations create systems and make changes to them all the time. What most leaders don’t realize is that all change has both intended and unintended consequences. Politicians are particularly bad at foreseeing unintended consequences. Make a law that employers must provide health insurance for anyone who works 25 hours a week or more, and employers reduce employees to 20 hours a week and employ two people for 20 hours instead of one for 40 hours. So now the poor, rather than having one really average role and no health insurance, have two miserable roles and no health insurance. Those we tried to help actually got hurt because lawmakers didn’t consider the unintended consequences.
The airlines decided they were going to charge people to check their bags. Intended consequence: the airlines make more money from people having to check bags. Unintended consequence: people bring everything they own on the plane as carry-on luggage, increasing the time it takes to board a plane; late departures skyrocket; and the experience of boarding a plane becomes more miserable than ever before.
Systems can be a very good thing, but you really need to think through all the consequences they will set in motion.
Another thing many leaders often fail to grasp is that there is a direct relationship between risk and reward. Decrease the reward and you decrease the risk people are willing to take. For a decade I worked with a Fortune 500 company where failure was so brutally dealt with that the culture developed a complete avoidance of risk. Because one failure basically meant the end of one’s career, I suspect that all the best ideas never got voiced. Even the greatest minds in that organization kept their best ideas to themselves because the culture became completely risk averse. This is a huge problem. In all markets, risk and reward are directly related to each other. In a risk-averse culture people are more interested in not making a mistake than they are in coming up with the next great idea.
Compensation is a huge system. This is one area where many businesses forget the essentials. For example, business is a meritocracy, meaning if your products and services are good, customers will reward you by buying them and telling their friends about how amazing they are. If your goods and services are horrible, customers will punish you by not buying them, and they will tell their friends to avoid your business too. This is a basic meritocracy system. But when it comes to compensation, it’s amazing how many organizations abandon the reality of meritocracy. If this is the system your customers use to give or take business from your organization, it’s the best system to use to guide your compensation of employees.
Whom you reward, why you reward, and how to reward really matter, and will have a massive impact on the way people behave. It’s a powerful system. If you have any doubt that systems drive behavior, make some changes to your compensation plan, then sit back and see what happens.
Take sales commissions as an example. How many salespeople promise the customer something they know is not possible just to get the sale (and their commission), leaving the inflated expectations and broken promise for the project to deal with? Be careful what you reward, because whatever you choose will be focused on at the expense of other things that may very well need your team’s focus.
Culture is a system. Systems either empower or entitle people. The second is very bad for your organization, and is actually a form of violence against the dignity of people and one of the most common forms of organizational cancer.
When systems are at their best, they add value in ways that work twenty-four hours a day, seven days a week, 365 days a year. The beauty of good systems is that they always manage and monitor, so you don’t have to be working all the time.
Leaders who don’t leverage systems become unpredictable micromanagers who drive everyone around them crazy. It’s like trying to play tennis and not knowing what the rules are. Beloved leaders hire talented people and trust them to deliver on the plan, making themselves available to advise, consult, and pitch in as needed.
First thing every Monday morning, I have each of my direct reports email me the three most important things they will be working on that week. It’s a very simple but powerful system, and the benefits are endless. Those emails tell me what my team is focused on for the week and where they might need my help or counsel. If I have a new direct report it allows me to learn how she prioritizes her work. If her priorities are not aligned with the mission, values, and Strategic Plan, I learn quickly and can coach her toward alignment.
Sometimes I see something on someone’s list and can say, “Hey, keep this in mind when you are talking to . . .” or “I already took care of that.” Sometimes the scope of a client’s project changes over the weekend. One of my direct reports lists the project as one of her top three priorities, which immediately reminds me to shoot her a quick email or stop by her office for five minutes to update her so she doesn’t waste time on the aspects of the project that have changed.
Three things on Monday morning—it’s a super-simple system that helps the whole team get focused on the right things for the week, and allows a leader to correct course if necessary. Just as a Strategic Plan clarifies the priorities of an organization for a year or more, something as simple as these weekly emails clarifies priorities for individuals and teams—and clarity leads to impactful action and the optimum use of resources.
Then there are the dreaded meetings. When’s the last time you were looking forward to attending a meeting—especially a regular one?
Meetings are systems. Most meetings are a horrible waste of collective time. They are poorly planned and poorly executed, most people don’t come prepared for them, and too many people see them as a break or a chance to catch up on their email (which is a myth unto itself; you are never going to catch up on your email). Hold regular meetings that are a waste of time and what message do you send people? It’s OK to waste time here. A sense of urgency is one of my favorite qualities in all the best people I have ever hired, but once you extract that, you have set them on the long road to the mediocre middle.
If there is one thing your best people hate, it’s when you waste their time. Do it often enough—with unnecessary meetings or anything else—and they will start looking for opportunities to add value elsewhere. Right, your best people don’t look for jobs. They look for the best opportunity to engage their unique ability to add the most value to some great mission.
Not all systems are good. Meetings are a system. They can be a positive or a negative system. What do we call a system that has strayed from common sense and is rampant with other dysfunctions such as taking forever to make decisions? Bureaucracy.
Systems that don’t increase mission impact frustrate your people.
Systems are essential for a well-executed Strategic Plan. The more of the Strategic Plan that is driven by or linked to good systems, the better chance you have of success. I’ve seen too many organizations whose own systems sabotage their new Strategic Plan; the plan is doomed from the start. So, once you have your Strategic Plan, it’s time to review your current systems and consider: Will these systems empower people to accomplish your Strategic Plan? What are your best and worst systems? Do you have systems that encourage behavior that is counterproductive to your Strategic Plan and mission? Do you even know the type of behavior you are trying to encourage? Are your systems working for or against your Strategic Plan? Which of your systems damage your culture?
Develop a great Strategic Plan, employ the right people to work the plan, put the right systems and processes in place, and then hold people accountable. These are the keys to the powerful execution of your organization’s Strategic Plan.
Systems are everywhere, and Dynamic Cultures harness the power of systems to create extreme competitive advantage and increase profits. That competitive advantage and increase in profit lead to a bigger future for everyone. Dysfunctional cultures end up costing a lot of money and creating even more human misery.
A business with a healthy culture is significantly more profitable than one with an unhealthy culture. It pays in dozens of ways to invest in Dynamic Culture, but the first investment you need to make is in your mind. I don’t care if you are the receptionist or the CEO, or anyone in between, decide right now that a Dynamic Culture is possible where you work. Become a Culture Advocate today—do one thing, however small, to make your culture healthier today than it was yesterday.
Systems are at the center of almost everything we do to serve our customers. They are a good culture’s best friend and a bad culture’s worst enemy. One of the essential laws of organizational life is that systems drive behavior. This plays out in a thousand ways every day in every organization. Most of the time we don’t recognize it happening. Open your eyes. Stop focusing on trying to change or correct the behavior; this is an exercise in futility. Identify the system that is creating the unwanted behavior and reengineer the system. Systems drive behavior. 122
