During lean times, soft and more difficult to define structures of the organization tend to become more evident, sometimes uncomfortably so. There’s nothing like a crises or simply a good, healthy conflict for exposing what really matters to leaders throughout an organization making decisions. Peter Drucker once stated, “Only three things happen naturally in organizations – friction, confusion and underperformance. Everything else requires leadership.”
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“Only three things happen naturally in organizations – friction, confusion and underperformance. Everything else requires leadership.” ~ Peter Drucker
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Making budget decisions is definer of organizational identity in both flush and lean times. By one classic model referenced below, organizations have hard and soft structures. Questions that may arise during budget reductions, may include:
- What are the core set of skills, knowledge and attributes that most valued for who we are now?
- Is job security a top concern? If so, who stays and who goes and why?
- Do the organization values, if defined, hold true? Do they exists in action? Are we managing to the values?
- Is the mission of the organization intact, changing, strengthening or weakening?
A classic and proven model that is a handy reference when reviewing organization impacts of budget decisions is the 7-S model by Tom Peters and Robert Waterman at McKinsey. The model includes budget-relevant soft structures such as staffing, skills, as well as intangibles of shared values, and style.
For an synopsis page of the 7S model, it is listed here (Tools tab.) A practical example of soft structures is highlighted in a blog post here about advertising agencies.
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“Culture” is part of the promise that an agency makes to its clients. If that culture is not clearly understood internally, agency employees will not be able to fulfill that promise.
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Advertising is a field heavily impacted by changes in technology including the rapid growth of social media. Advertising is also an art based in understanding the sensibilities of the times. Here are several well-known winning ad campaign examples, steeped in culture old and new:
As leaders work through various budget models for 2009 and 2010, consider what the budget actions, and examples mean for testing the soundness of both the hard and soft structures of your organization. Are current leadership actions and behaviors good examples of values in action? Or are the values hollow words, like those of the now defunct Enron?
Here’s a useful illustration of values-in-action:
- Actions are what count – not what’s on paper. If there’s a disconnect between what you say is important and what people do, you need to fix that right away. Rather than building a series of rules, build a series of examples. People learn from examples and role models – not from a list of words.
Source: Can You Pass “The Enron Value Test?” via PR release.
Organizational stories are powerful and deserve solid place next to performance measurement and big-data. They are a helpful cross reference for what may be in the process of being redefined by budget impacts.
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“The purpose of a storyteller is not to tell you how to think, but to give you questions to think upon.”
~ Brandon Sanderson, The Way of Kings
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Values, organizational and leadership competencies, and any agreed upon communication procedures and principles are one of many “soft” checkpoints as budget decisions are being made. Test them by looking at prevalent, and well known organizational stories.
And for all the decision makers and those in transition, it may be useful to remember the optimistically bent, master storyteller and legendary syndicated commentator, Paul Harvey who passed away this Sunday:
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“In times like these, it helps to recall that there have always been times like these.” ~ Paul Harvey
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Contact Deb via DebNystrom@REVELN.com or see Deb’s contact page.
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