Last year, I read Pat Lencioni’s book, The Advantage. The Advantage is my favorite thus far of the nine Lencioni books I’ve read. Here’s how it inspired me to refresh the way we handle corporate strategic planning.
Healthy and smart business
The Advantage starts out by discussing two requirements for success. A business must be both “smart” and “healthy.” He describes “smart” as being proficient at strategy, marketing, sales, finance, technology, and operations. He describes “healthy” as minimal politics, minimal confusion, high morals, high productivity, and low turnover. Basically, “healthy” is how aligned, motivated, and committed your staff is.
Lencioni makes a very compelling case that “healthy” beats “smart” every time. Healthy firms tend to get smart, but smart organizations don’t necessarily get healthy.
Technology enables a healthy business
I was considering Lencioni's book and relating it to the service we deliver at Endsight. I know that well run Information Technology (IT) makes a company “smart”. Technology is clearly critical for all the operational elements of a business. Could well functioning IT also contribute to “health”?
One thing I know to be true from years in this business is that people sometimes get frustrated, even angry when their computer systems aren’t working well. You’ve probably experienced this first hand at some point in your life.
I think the reason people have an emotional response to malfunctioning systems is the same reason that people experience road rage. When people are inhibited from achieving their goals, it’s a natural reaction to be frustrated. The modern workforce requires their computers to work in order for them to do their job. When the system isn’t working, they not only lose productivity but also experience the negative emotions associated with being hindered from reaching their goals.
When the staff is unable to get their job done, they are appropriately annoyed. What if these negative emotions have a more serious implication to firms than just a passing moment of frustration? Perhaps, the most serious issue here is that employees believe that the technology isn’t working because leaders and managers are failing to make the necessary investments. If this is the case, employees will rightly feel set up to fail. They will start to blame any lack of results on management versus taking ownership. Ultimately, their leaders will lose credibility causing workers to be less happy, less committed, and less productive.
The bottom line here is that when technology doesn’t function the way it’s supposed to, companies can take a hit to both their corporate “intelligence” and “health”. Companies with poorly managed or out of date technology are more likely to experience high turnover and lose employee alignment to the corporate strategy and vision.
The true cost of technology
What’s interesting is that the cost to have great technology is actually very low in comparison to the high costs of direct labor, employee benefits, occupancy expenses, workers comp, taxes, and the slew of other employee-related expenses. In fact, the cost of good technology is also low in comparison to the value it brings to the organization and the risk associated with downtime and data loss.
Unfortunately, it requires progressive and enlightened leadership to make forward-looking investments in technology. In today’s business environment, many business leaders are not technology “natives” and still don’t view technology as being as important as it truly has become in the modern business era.
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