Are we “programmed” to let our own house burn down?

Behind every decision is a motivation and behind every motivation is a need. According to Maslow, we seek to satisfy our needs in a certain order and our number one priority is to satisfy our basic physiological needs. A hungry person will put his or her life in danger to get food.

The problem is that we do not feel a vital need to preserve our home.

Most of our “responsible” behaviors respond to secondary needs of self-esteem or personal accomplishment: I sort my garbage because it is responsible, I plant trees because I feel useful.

On the contrary, most of our “irresponsible” behaviors respond to primary needs, physiological satisfaction and security: I transform the forest into fields to feed myself, I eradicate species to protect myself.

To preserve our planet, we must profoundly change our relationship to the world and reprogram the hierarchy of our needs to make the preservation of our home an even more fundamental need than the satisfaction of our own physiological needs.

Are we individually and collectively capable of making environmental preservation the “zero” level of our Maslow pyramid?

In practice, this would mean that we would (for example) be able to accept to feel hunger and thirst if that was the price to pay to preserve our planet.

No animal is capable of this. The hungry animal eats without worrying about the consequences on the environment. But we are not animals and our intelligence could perhaps allow us to reprogram the hierarchy of our individual and collective needs.

The time of liquid organizations

The forces at work in the knowledge economy require a complete paradigm shift in the way organizations are thought of and managed. This revolution concerns all forms of organization.

The hierarchical organization has made the success of large industrial companies. Vertical structuring coupled with a high degree of task specialization has resulted in increased quality, optimized capacity utilization and reduced cycle times. The priority is then given to efficiency.

Industrial Economy:

– hierarchical organization
– tangible assets
– efficiency

The matrix organization has become the dominant model in the service economy. It has made it possible to combine proximity to the customer and the pooling of critical resources. This is the time of dual reporting (hierarchical and functional), shared service centers and cross-functional processes. Without losing efficiency, synergies are sought.

Service Economy:

– matrix organization
– intangible assets
– synergies

The knowledge economy has been imposed with the digital revolution. Today, companies must maintain their efficiency and optimize synergies, but they must also and above all be agile to detect and seize opportunities quickly. Collective intelligence becomes the key asset.

Knowledge Economy:

– liquid organization
– digital assets
– agility

Each organizational model has its own management by objectives system:

– Hoshin Kanri: industrial organization
– Balanced Scorecard: matrix organization
– Objectives & Key Results: liquid organization

We speak of a new paradigm when we profoundly change the ideas and words used to analyze and optimize a system. The new paradigm must retain the advantages of the previous one while meeting new and radically different requirements.

Wanting to use a management system that was designed for a matrix operation cannot work with a liquid organization. Today, it is anachronistic to want to be agile while driving the strategy with goal cards.

When there is a disjunction between the forces of the economy, the organizational model and the management system, the company is not only unable to respond to new challenges (agility) but it ends up losing what made it strong:

– Synergies disappear.
– Efficiency collapses.
– Employees are confused.
– Psychosocial risks are exploding.
– The best talents leave.
– Companies are disappearing.

Changing the paradigm is very difficult because it requires a change in vision, culture, values, behaviors, processes and tools.

Few leaders are aware of this and even fewer are capable of it. Creative destruction does the sorting.

Competing in the knowledge economy

The art and science of defining effective OKRs

How to find the right balance between directive and participative modes?

When using the OKR methodology to deploy strategic objectives, the cycle starts with the President defining the 3 to 5 key objectives of the company:

– Develop our business in Asia
– Reduce accidents on the worksite
– Improve our profitability
– …

Each objective (qualitative) is then complemented by 1 to 3 key results (quantitative).

For example, we want to develop in Asia and in the next 3 months, we want our monthly turnover in this area to increase from 20 to 30 million euros.

The objectives set by the President are then broken down into sub-objectives and delegated to the President’s N – 1. The exercise is repeated at all levels of the company.

When this process is applied, the OKRs of all employees are 100% aligned with the goals set by the President. We will then speak of global objectives.

But in practice, each manager also needs to be able to mobilize resources on objectives that are not global (directly or indirectly linked to the objectives set by the President).

– Rebuilding a burned-out factory

We will then speak of a local objective for the manager.

When the manager defines a local objective and delegates the sub-objectives, the employees concerned contribute to an objective that is neither global nor local (for them). This is called a hybrid lens.

An employee can thus find himself with global (linked to the President’s goals), hybrid and local goals.

An employee’s (overall) goal alignment factor (%) can be easily calculated by dividing the number of “overall” goals by the total number of goals. One can also calculate the overall alignment of a BU or the entire company by averaging this factor for all employees in the area.

This factor (%) is a very revealing indicator of the company’s management style.

A factor greater than 75% will indicate a very strong alignment of all employees with the overall priorities of the company. This is a case of very directive management, which can be indispensable for managing a very rapid and profound transformation of the company.

A factor of less than 25% will indicate a strong decentralization of objectives and a very participative management style which is generally characteristic of companies where operational excellence takes precedence over the achievement of long-term strategic objectives.

From a management point of view, it is interesting to note that this factor can easily be controlled. It is sufficient to set an overall alignment goal at the beginning of the cycle. Example: each employee must have between 3 and 5 objectives and a minimum of 65% of “global” objectives.

Double inversion of the logic of the deployment of objectives

Management books teach that the deployment of strategy is done (1) from the long-term to the short-term and (2) from the top of the organization to the bottom of the organization.

But in a liquid organization, the deployment of the strategy can follow a completely symmetrical logic.

(1) The objectives of the top of the company are defined by “distillation” of the objectives identified by the field teams: the field suggests to the executives the objectives that the field deems relevant but which cannot be implemented by the field due to lack of time, resources and prerogatives.

(2) Long-term goals are achieved by “distilling” short-term goals. These goals are important, but they require more time and/or assume that short-term goals have been achieved.

This symmetrical approach shakes up the CEO who considers that his job is to see far and set the main directions.

But it has the merit of empowering each employee in the design and execution of the strategy. It starts from the daily experience of thousands of people who are in contact with markets, customers, competitors, suppliers, products, processes, tools, the organization.

This approach does not deny hierarchical authority since each manager sorts out the objectives suggested to him by the field and he retains the rights and duties conferred on him by his status (his place in the organization).

There are many arguments against this view.

▪️ Operational teams have their noses in the handlebars and don’t have the step back to see the big issues and think long term.

The counter-argument is that executives see macro issues and have a long-term vision but lack the proximity to see the operational declination and short-term priorities.

▪️ If everything starts from the base, how to ensure that the teams will follow homogeneous methods and that the priorities will optimize synergies?

The counter-argument is that the priority given to synergies and homogeneity comes at the expense of agility and creativity.

In conclusion, the inversion of the pyramid is not the magic solution but the dominant management software is not perfect: 70% of transformation projects do not reach their objectives, 8 out of 10 employees do not understand the strategy of their company, 35% of employees’ time is devoted to activities of which they do not see the added value, etc.

These facts invite us to ask ourselves difficult questions.