Relationships
The disturbing recent UNICEF report that Britain is now the worst place in which to grow up across the 21 industrialised nations, should have alarm bells ringing in UK companies.
Not because they are entirely responsible for the country’s social climate, but because they are increasingly suffering the consequences. Their contribution to the situation is they have allowed work to become meaningless, relationships at work to be devalued, and core values themselves to be consigned to platitudes published on wall charts and policy documents.
The evidence of something wrong stems not just from the UNICEF report, which puts Britain bottom of the developed countries for caring for children and young people. The national rate of depression is high, sickness and absence rates are frequently excessive, many companies live with rapid staff turnover, there is widespread lack of trust in managers and low levels of engagement. Together, these amount to a stark picture of what it is like to live and ultimately work in Britain.
As suppliers of development, we have a special focus on the caring, people-focused end of the work spectrum. Often we come away from companies struck by the toxic environment, where share price dominates over everything and certainly relationships, and where insecurity and adversarial managerial styles make it almost impossible to get the best from people.
It is not surprising that in the last few years we have seen increasing references to the spirit or soul of organisations. This is not merely the next management fad. It is happening because many thoughtful people feel genuinely concerned about what is happening within organisations. Driven by diverse mantras such as competition, globalisation, shareholder value, and cost containment, we see too many companies treating people as totally expendable.
Why is it that mergers and acquisitions are now an almost discredited method of adding value to a company’s situation? It is not just that blindly cramming different cultures together in search of an elusive synergy generally proves useless, but it commonly destroys relationships that were once central to the effectiveness of the business.
Yet we know that relationships at work are all-important. They are the key to binding a company culture together, making it a place fit for human beings. Find a company with excellent relationships and you can take it anywhere in terms of growth, innovation and change. Find one where relationships are undervalued and you have a company that ultimately has no long-term future.
Helping companies address relationship issues is no sinecure. It is a tough challenge, often in an environment where what we are trying to do can sound fluffy or only indirectly connected to current business objectives. Yet the latter seldom stand up to close scrutiny, without revealing their absolute reliance on establishing sound relationships throughout the enterprise.
Evidence that relationships in companies often need an entire makeover keeps appearing in various guises, often described under a generic heading as culture change. Unfortunately, those equipped to help with relationship building, who understand the complexity and the dynamics remain comparatively rare. The continuing surge in demand for coaching though, suggests one-way companies are trying to tackle the issue.
The rise and rise of emotional and social intelligence as areas for development in companies reveals yet another way some are reaching out beyond the sterility of shareholder value, profit maximisation, and market share. The best leaders already do this, and are sometimes quite explicit about it:
“When I get up in the morning and I look in the mirror and shave, if I think to myself that I'm going to go work for the largest bank in the world, or the largest insurance company in the world, I would kill myself. Because nobody wants to work for the largest bank in the world. People want to work in small teams, they want to work in partnerships, they want to work where it makes a difference whether you come to work that day, whether it makes a difference whether you have a good day or not, whether you do your job well, where you know everybody and you can rely on them, and they trust you, and you trust them, and you've got respect.
Charles Prince, head of Citigroup
That relationships are at the heart of company success may not always seem entirely obvious. Yet expressed in terms of team working, people needing respect, meaningful work, trust in the leadership, engagement, and talent management then we see more clearly how relationships in some form govern so many facets of a company’s operations.
Looked at in this way, we see how the macho climate in some city firms, the difficulty many have in grasping opportunities of diversity, and the continued failure across Britain’s boardrooms to appoint women to senior positions, all reveal why so many companies need help with relationships.
Two bogeyman currently haunting the corporate scene continue to damage companies and the relationships that make them viable. The first is the rise of private equity firms. They are currently causing growing concern for their lack of transparency, accountability and because some appear nothing except old-fashioned asset strippers.
Complaints about the acquisition of the AA for example, reek of the sort of destruction to moral, relationships, and image previously associated with those unlamented conglomerates, or the equally discredited Chainsaw Dunlop.
In 2004, the AA was sold for £1.75 bn to two private equity firms. Since then there has been a flow of adverse stories of a third of the workforce pushed out, discrimination against disabled people and what Will Hutton has called “mortgaging the future to capture gains for personal enrichment.”
The other bogeyman indirectly links to the first, but with an older provenance. It is the cult of the quick win, recently described succinctly by Stefan Stern in an FT article (Easy Appeal of a quick win, FT 27.2.07).
Stefan quotes systems thinker Russell Ackoff as saying, “Problems that arise in organisations are almost always the product of interactions of the parts, never the action of a single part. Complex problems do not have simple solutions.”
This view of the organisation reflects our other hot topic on Complex Adaptive Systems, in which organisations need to be viewed through the lens of complexity, if one is to make sense of actions and decisions to change them. The quick fix ignores this complexity and views companies more as machines with a right and a wrong way of doing things.
All this adds up to a sorry picture of many UK companies and how they and their owners function. Luckily, there are plenty of organisations aware of the dangers. Many have shifted to healthier patterns of behaviour. These include opting for organic growth, giving close attention to making work more meaningful for everyone, valuing and pursuing transparency, diversity, and social responsibility with enthusiasm.
