This is a guest post by James Sheard founder of The Accountancy People
There are two fundamentally different approaches to running a business.
They lead to very different cultures.
One is the carrot: the other is the stick.
How these two approaches are blended within your business is fundamental to how it feels and to its success.
The stick is all about command and control, which always has fear alongside.
This approach is all about instructing people on what they should do and carefully monitoring them so that they do it.
The effect is to appear to improve productivity by grinding out more and more work for less and less cost.
Call centres can be prime examples of this where:
• all calls are monitored: with statistics on the number of calls, time per call, the sales from each call, used to determine success
• every moment the member of staff is at work is monitored: lunch breaks, toilet breaks, every computer key stroke and conversation
• ways are found to de-skill the work so the business can pay the staff less
Business is entitled to get the most out of its people; they are free to get another job.
Indeed business needs a level of control to make sure things get done.
In order for command and control to work there have to be sanctions i.e. punishment.
The reason punishment works is because we are frightened of it.
• it reduces staff loyalty and innovation
• if you’re fearful you’ll worry about not getting into trouble and have no energy left to be creative
• it stops you giving great customer service – you might miss your key performance indicator by spending too long with someone
But more than this, I believe it sucks the humanity out of an organisation and can make it behave in a psychopathic way.
“It’s just business” can mean there’s no regard to the underlying humanity – the people who work in the business, the customers, the families of both….
Results driven businesses can do terrible things – not because their people are bad people but because they work in a bad system.
I don’t know the full facts about what happened but I do know that Tesco, the UK’s largest food retailer, ended up falsifying its accounts and selling horse meat in its beef burgers.
I suggest these are indicators of a culture that lost its way.
The big banks created havoc within our economy and destroyed shareholder wealth on a monumental scale through their behaviour prior to 2007.
Again, something was deeply wrong at the core of these organisations.
That’s on a big scale.
At the individual level, you get people with decades of blameless service being sacked on the spot, a stress epidemic, abusive zero hours contracts and appalling customer service.
This is the battery farm approach to business.
It’s possible to create a culture where people are treated like grownups, an organisation that does not play fast and loose with its people and their relationship with the business.
A business that has goals beyond just making money, goals that people can believe in and strive towards.
A business that people care about and where they want it to succeed. Such a business is much nicer to work for, it’s innovative and robust.
Of course, even if you have free range employees you need to have some control so that the work actually gets done, and people don’t play the system.
You also need to be realistic and not naïve about the motives of others.
The mix of control and the sort of culture within a business will be both an expression of the personalities of those that set it up, the influence of the people within it and industry it is in.
The more you need rare, highly skilled employees, the less they will accept a battery farm approach.
The more your industry is commoditised, the more you need to eke out all the efficiency you can through control.
But it’s still possible to play nice.
I always think motorway services are the most soulless, performance-managed places – yuk.
But if you go to the services at Tebay in Cumbria, or their sister services near Gloucester, they are family run. They operate on an entirely different basis bringing the produce of local farmers, bakers and other producers to the traveller’s table – and they are wonderful.
They are also successful, highly profitable businesses.
One area they excel in, is customer service.
There‘s a myriad of elements required for a business to give great customer service:
• the people you employ need to feel happy and valued in their work; you can’t make other people feel good unless you feel good yourself
• everyone needs to have enough work but not too much; too much work and there’s a danger customers become seen as a hassle – not the route to great service!
• you need the right sort of people who are naturally service orientated
• you need to hold on to good staff – they’re in demand – but keeping good people is key to the relationships your business has with your customers. After all they can’t give a great service if, as new employees, they don’t know the company, its products or how it operates.
There also needs to be a balance here between getting enough work out, so you make some money, and spending time with people so they feel valued – whether that’s the business owner with staff or staff with clients.
It’s a crucial part of a healthy eco system.
As the boss it’s easy to be impatient or even aggressive and demand that work is done to a deadline. However, this will have a direct impact on how your team feels, their customer service and whether they stay with you.
Culture is about how you behave towards each other and is fundamental to how your business works. Is your culture delivering for you?