by Tim Connor, CSP
(Editor’s Intro: Some 100 MH Industry firms are clients of Tim Connors, so listen carefully to what this insightful author and consultant says! Tim energizes a room with his presentations – because he gets to the heart of real issues. Tim’s books, CDs and training aren’t just on my shelf, they are read, heard and my own goal is to routinely implement them.)
For years, I have been trying to put my finger on what is the single major cause of corporate malaise, dysfunction and a general lack of enduring consistent and profitable success regardless of the economy or other external circumstances. One afternoon while I was in front of an audience explaining the causes of many of these challenges, the words Corporate Disconnect (CD) just flew out of my mouth. So what exactly is Corporate Disconnect (CD)?
I don’t care whether your annual sales are less than one million or over one hundred million; whether you have 10 employees or 3000. I don’t care if you are a start-up or you have been in the manufactured housing industry for over 60 years. Let me repeat: Corporate Disconnect is at the heart of every problem you face today, faced yesterday and will face in the future.
In a global and rapidly changing world, there are non-stop opportunities and challenges facing managers, executives and business owners in every industry today. These can literally put you out of business in a heartbeat without regard to your history - or they can catapult you into the future with tremendous speed and success.
Change is not new. Change is at the heart of every new invention, enterprise, product, service and idea. Change is and has been the mantra for business leaders for many years. Change has and will continue to plague your plans and your dreams. Change will require that you keep vigil and keep your hand on the wheel with courage, foresight and passion. Change is not sensitive to your lack of direction, goals, plans or strengths and weaknesses. It is totally indifferent to your previous successes and achievements. And your inability to anticipate, prepare for and adjust quickly to change, whether you choose it, like it or agree with it, will doom your organization - whether as a slow kill or an overnight disaster.
The choice is yours: Continue to struggle with the same problems year in and year out or, once and for all, move forward with purpose, clarity, passion and effectiveness.
Corporate Disconnect is:
1.When the realities that exist at the lower levels of an organization and their market don’t find their way to the organization’s highest levels – where direction is set, goals are established, vision is created and major decisions are made – with accuracy, continuity, clarity and consistency.
2.When the vision, purpose, direction and leadership at the highest levels of an organization do not accurately radiate throughout the entire organization with integrity, accuracy, clarity, accountability and consistency.
3.When lack of corporate-wide congruence negatively impacts sales, profits, effectiveness and consistently healthy growth.
Let me elaborate further.
If you have ever been in an airplane at 40,000 feet on a clear day, I’m sure you’ve had the experience of looking out the window and being able to see for hundreds of miles, but also realizing that you couldn’t see any detail on the ground.
To describe CD, I’m going to use the illustration of flying as a passenger on an aircraft. This illustration is straightforward and easy to apply to the concept of CD and all of its ramifications, symptoms, causes and solutions.
Let’s say you are returning from a business trip and are now flying over the western part of the US heading toward Los Angeles. As the pilot announces that you are flying over the Continental Divide, you peer out the window and realize that you can see the topography of several states: Colorado, Utah, Wyoming, New Mexico and maybe even a few others. No matter how far you can see, however, you can’t see any detail. No cows, trucks or houses. You are just too high to make out anything other than the vast expanse of raw land. Later, the pilot announces that he is beginning the descent. As you descend through the 20,000-foot level, you notice that you can’t see quite as far, but the details are getting a bit clearer. You can see houses, roads and factories, but you still can’t tell if that’s a cow down there or a truck. As you get closer to the ground, you notice that you can’t see as far off on the horizon, but the details are getting clearer. At 500 feet, your expansive view of the horizon no longer exists, but the details are quite clear. You can tell that there’s a red truck traveling on the highway off to your right. You land, and another safe trip is behind you.
The analogy: Presidents, CEO’s, CFO’s and other senior executives are typically flying at the 40,000-foot level in their organizations. They can see a long way. Their vision for the future is clear and their awareness of major storms or opportunities can be easily seen at this altitude. But details? Not a clue. Middle managers, directors or senior staff employees are typically flying at the 20,000-foot level in their organizations. They don’t have as clear a view of the horizon as their superiors, since they are 20,000 feet lower, but their view of the details is a bit more evident; not totally clear, but better than at the 40,000-foot level.
Then there are the employees in your organization who are flying at 500-feet, almost at ground level. They don’t have a clue what’s going on beyond their desk or the building next door, but they can tell you what customers think, what policies or procedures are working or not working and what is generally going on in the bowels of the organization. They know the details, they live them every day; but they, for the most part, don’t always see the connection between the reality at 500 feet and the vision or decisions at 40,000 feet.
Here’s the simple truth in two sentences: If the reality of what is going on in the marketplace, with your customers, with your competitors and/or with your employees is not getting to the 40,000-foot level, I will guarantee you are experiencing CD. Likewise, if the vision, leadership or goals at 40,000 feet are not finding their way to the 500-foot level, I guarantee you are also experiencing many of the negative issues of CD in your organization.
So, what is Corporate Disconnect? It’s when your employees who do the work don’t see a connection of their efforts to the vision of your senior management. It’s when your senior management makes decisions or takes actions at the 40,000-foot level – new policies, new products or services, acquisitions, new divisions or branches, new anything – and they do it without getting in touch with the reality at 500 feet.
Beware! This is a recipe for lost customers, lost revenue, lost growth, poor employee retention, and any other negative corporate malaise you can think of or experience.
Got a bad case of CD in your organization? Here’s a little truth to consider. In my 40-year speaking and training career, I haven’t found a single organization that didn’t have some degree of CD going on. So, would it appear that having a case of CD is normal? Yes, every company has it to some extent.
Here’s the bottom line. No matter how bad your case of CD is or whether you are aware of it, fixing it, ignoring it – whatever - as long as your CD doesn’t ever touch your customer or the market place, there is no critical problem; you will most likely survive CD’s symptoms. However, if your CD does impact your customers, suppliers, the marketplace and/or your prospects, watch out! You may be in for a long and difficult recovery period with a few emergency room visits along the way.
What are the symptoms of CD?
Now that you are beginning to understand CD and how it is manifested in your organization, you are ready to take a brief look at some of the symptoms of this disease. Then we will discuss how to reduce it, eliminate it, manage it or possibly even prevent some of it.
Every organization I have worked with worldwide for over 35 years has suffered from CD to some degree. Over the years that I’ve observed these organizations, I’ve put together a list of some of the common symptoms. The following traits are not in any special order or degree. Every organization experiences some of them; some organizations experienced many of them and a very few suffered from most of them. And if they did and didn’t correct them, they are most likely just a statistic now. Circle a yes or no by each item as it relates to your organization from your perspective. Remember, your perspective will vary, depending on whether you are at the 40,000-, 20,000- or 500-foot level.
Here, now, are the 50 most common symptoms of Corporate Disconnect:
1.You spend too much time behind your desk, on the road or turning a blind eye rather than being in the right place at the right time to know what is really going on.
2.You are consistently solving the same problems over and over again.
3.You have inconsistent customer satisfaction.
4.You have varying morale levels in different departments, offices or branches and these levels go up and down a great deal.
5.You have excessive turnover.
6.Lots of things fall through the cracks – e.g., money, decisions, people, resources, etc.
7.There is a “here-we-go-again” culture.
8.There is a lot of “us vs. them” going on.
9.Your employees are under a lot of stress.
10.There are too many meetings where little is accomplished.
11.You are wasting money on initiatives where you can’t justify the return.
12.You are increasingly vulnerable to competition and market shifts or trends.
13.You are losing customers faster than you are gaining new ones.
14.Vendor relationships are antagonistic or mistrusting.
15.You have a group of frustrated and dissatisfied dealers, distributors or franchisees.
16.Decisions are made at the last minute, are delayed or are made for the wrong reasons.
17.You have increased hidden agendas among employees.
18.Your employees are getting burned out.
19.The cost of doing business is increasing faster than your profits.
20.You have poor communication throughout the organization or between some departments, divisions or groups.
21.You have a retention problem of good employees.
22.There is a lot of change going on in your organization.
23.Employees who bring problems or reality to management are seen as whiners, trouble makers or not team players.
24.Disagreement is perceived as disloyalty.
25.Employees don’t trust management. Management doesn’t trust employees.
26.Performance, effectiveness or productivity is a problem corporate wide or in certain groups.
27.Finding good potential employees is a problem.
28.Employees edit bottom-up information for fear of retribution or invalidation.
29.Completed mergers or acquisitions have taken longer than necessary to achieve success and employee buy-in.
30.Strategic planning in your organization is either a myth, a fantasy or lacks integrity or follow-through.
31.For most employees, working in your organization isn’t fun.
32.Leadership at the 40,000-foot level is lacking.
33.The investment in employee development is non-existent, minuscule or ineffective.
34.Some departments are more concerned with their own success than the success of the organization as a whole.
35.New employee orientation is lacking or ineffective.
36.Finger-pointing is common when things go wrong.
37.If the business has family members, they are treated differently than other employees.
38.Innovation is lacking throughout the organization or in some departments.
39.You are losing the human touch and relying too heavily on technology for communication.
40.Your organization has an arrogant leadership style.
41.You are a WHO rather than a WHAT organization.
42.Decision-making is almost entirely top-down.
43.Goal-setting and corporate planning is primarily a 40,000-foot activity.
44.The organization is led by a “committee mentality.”
45.Generally, responsibility is given without authority.
46.Employee reviews are non-existent or just routine with no value to either the employee or management.
47.Fear and reward are the primary motivational methods.
48.Compensation and/or bonuses are paid for any factors other than performance.
49.Mixed messages top-down are common.
50.Decision-making throughout the organization is reactive or stymied.
These are most of the symptoms of CD. Yes, there are others, but the above 50 generally cover the most important ones. How did you do? Got CD or not? How bad? What are the consequences of CD?
Many executives and managers seem at a loss to identify the numerous causes of their lack of sustained growth, inconsistent financial performance or shrinking market share. Many of these same managers are quick to blame outside forces such as the economy, market shifts or trends, competitor strategies or overall consumer malaise. Few of these managers, business owners or executives are willing to look at their own management style, behaviors or attitudes for the causes of the above issues.
The consequences of failing to look in the mirror from time to time have a far-more-reaching impact than just CD. Yes, Corporate Disconnect is one of the major consequences of a lack of clear thinking, top-down responsibility and focused vision, but in the end, much of the pain associated with these challenges could have been avoided or lessened if these managers had been honest and admitted that their organization is where it is because of their lack of leadership, focus, planning or right actions in a timely manner.
Over the years, I have watched hundreds of companies fail for one reason: CD. Yes, there may have been other underlying contributors, but in the end, the final blow came because management failed to understand how CD was impacting their performance and success or lack of it.
Business failure is very costly. Although business failure is often the natural ebb and flow of market changes and companies’ lack of accurate and timely responses to them, too often companies could have weathered the storms that caused their failure if their management had been more responsible and responsive.
Why do many of these business fail or just get by year after year? Because some business owners or executives are too arrogant, ignorant or blind to anticipate the problems that were coming or failed to execute strategies and/or behaviors that could have saved the business in a timely manner.
There are many more consequences – like losing customers, customer resistance to price increases, increased customer dissatisfaction and problems, vendor pressure to perform or to pay higher prices for the services or products you are purchasing from them, a lack of cooperation or support from financial institutions where you may have lines of credit, fiduciary responsibilities or debt, etc.
The bottom line – the cost of failing to identify and fix CD – is far more costly over time than addressing its symptoms before disaster strikes. Over the years of working with many clients in the manufactured housing industry, I discovered a frequent, but disturbing, mindset: There was always enough time, enough resources and money to fix problems, but never enough to prevent the same problems from occurring in the first place.
Got a case of CD? The answer is yes. So the real question is, what are you doing about it?