3 Reasons Organizations Underperform

If your organization is like most, it only performs at its peak sporadically; in specific departments for a few hours or days at a time. Your people think and act phenomenally during periods of crisis or intense focus but return to the status quo once the pressure subsides. You’ll see employees at their best while working on a serious quality issue or jumping through hoops to ship the plan at the end of the month. But what about the rest of the time? How much of your organization’s capacity is engaged when there’s no crisis or impending event? Results vary, but it’s safe to say that most businesses perform well below their potential most of the time. This is a common crisis with enormous consequences.

  • Millions, even billions of dollars are consumed by waste that could be minimized or eliminated with the right focus, skills, tools, and mindsets
  • Customers become disappointed and seek competitors who offer higher quality, better service, shorter lead times, or lower prices
  • High performing employees become frustrated because of the apathy, entitlement, and complacency that surrounds them and either leave or quit without leaving
  • Organizational culture forms around the status quo and renders managers almost powerless because mediocre performance has become the benchmark in the minds of the masses

What’s unsettling is you may not know what your organization is capable of achieving, and you may not believe someone who tells you what’s possible. The risk in this is your people may have become so content with the current state that waste looks like work. It’s a costly tragedy when sub-par performance becomes the standard when twenty, thirty, fifty, or even ninety percent improvement is possible.

With all this wasted potential, you will be one step ahead of your competition when you understand three reasons why organizations fail to consistently reach their full potential.

Managers reward firefighting not process improvement

An organization with excessive waste will experience excessive problems which require firefighting. The problems is that firefighting, while seemingly necessary, doesn’t eliminate waste. In fact, firefighting is waste (overprocessing). When leaders recognize firefighting more than process improvement, people become ambitious expediters reacting to problems as soon as they surface. While quick response to problems is important, over-promoting firefighting will lead to an addiction to the heroic recovery, where reactive behavior appears to be valued more than problem solving and process improvement. Firefighting isn’t working on the business, it’s exhausting time and money in an effort to save the day. Leaders must achieve the right balance of reactive and proactive effort to improve performance.

Managers fail to set the expectation for process improvement

The eighth deadly waste is underutilizing people. We do this when we view people as a means to get work done vs. improve how work is done. This is particularly tragic because employees see scores of improvements they could make but don’t. Instead, they blame management for not fixing them. What’s sad is that most people really do want to remove waste and usually have good ideas. What’s missing is the expectation to work on the work and the support to make meaningful improvements. Managers will only realize the full potential of their people when they set the right expectations and engage them in improving how work is done.

Managers set low expectations for what matters most

It’s rare to find a manager that sets high expectations for mindset, teamwork, and process improvement. The focus is typically on attendance, quality, and maybe productivity. The truth is that most managers avoid the soft side of leading people and stay with safe, impersonal, easy to measure, expectations that only produce the bare minimum. On the other hand, managers that expand their focus to how people think and act, get to the real issues behind performance problems, paving the way for excellence. You might think this is just common sense, and it probably is, but it isn’t common practice. Dealing with thinking is one of the major differences between managing and leading and is the most impactful skill a leader can develop. A team in conflict will struggle to achieve moderate results but an aligned team can do just about anything. When you strip away all the buzzwords and fanfare, what successful leaders really do is align people’s thinking with the company vision. This doesn’t happen with emails, blogs, posters, or video conferences. It happens one on one coaching conversations rich in respect, support, listening, authenticity, and passion.

While this list isn’t complete, it does contain three of the most common leadership problems that we see in working with clients. We understand that leading a high-performing organization comes with complicated challenges. At Lean Partners, we help leaders not only set processes and tools in place to increase performance and reduce costs, we also help guide leaders through the cultural and people issues that impact business success. For more information on Lean Partners and how we can help your company, visit: leanpartners.com.