‘It’s THE People… Stupid!’

Accountability Organizational culture Organizational leadership

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Key Point: The title above is a riff on the famous phrase coined by James Carville during the 1992 American presidential election, “it’s the economy, stupid!” Lets officially declare and be clear! The priority order AND focus in organizations should be: 1. People 2. Customers, and then 3. Shareholders. The company I have the privilege of being part of is 77 years old, employs more than 5,000 people, and has had net income growth of more than 25 percent each year for the last three years. Each successive year has returned a record profit. Of course we scour our financial statements at regular intervals but what’s most incredible about our company is that we don’t really talk about or focus on profit in our daily work. We do, however, always talk about team member engagement, trust and our productivity. (Our people scores put us in the top 10 to 15 companies in Canada and likely in the top five percent of companies to work for in the world). We must and will get even better. 

I’ve worked in industry for 40 plus years, including three countries and in every type… I’ve worked in Fortune 50, mid-size, startups and both public and privately held organizations. From the day I joined THIS company, from the Chairman and CEO down, it was made crystal clear that the priority focus was PEOPLE FIRST 

As the Chief People Officer, my role would be well beyond traditional “HR.”  Most companies I’ve been around have touted “people first,” but the real order of priority has been 1. Shareholders. 2. Customers and eventually 3. People. Note the following insightful analysis on why it’s been this way for so long, by respected author Steve Denning:   

“Achieving humanistic management has turned out to be a much more intractable problem than most thought leaders expected it to be… Why is change so difficult? One reason is that an unholy alliance links shareholder value theory and hierarchical bureaucracy. Once a firm embraces maximizing shareholder value and the current stock price as its goal, and lavishly compensates top management to that end, the C-suite has little choice but to deploy command-and-control management. That’s because making money for shareholders and the C-suite is inherently uninspiring to employees. The C-suite must compel employees to obey. The result is that only one in five employees is fully engaged in his or her work, and even fewer are passionate. The very foundations of humanist management—collaboration and trust—are missing…” 

Primarily because of the internet, Denning goes on to say that this “unholy alliance between the C Suite and Shareholders” is under pressure to behave differently: “The locus of competitive advantage is now being determined by interactions with the customer, built on the work of engaged and passionate workers. The central strategic questions of the industrial model, ‘How much more can we sell?’ and ‘How much money can we make?’ are replaced by ‘Why should customers buy from us?’ and ‘What else do customers need?’” Hooray, I say!! 

Here is the great thing about the power going to customers and the disruptive attack on almost every business model: Only engaged, passionate, and committed team members will effectively navigate an organization through the “rapids” to get and keep customers that want to give their hard earned money to any company. And even better, it has to be everyone “ALL IN.” The C suite can’t do it alone. And over compensating CEOs isn’t a sustainable difference (if it ever was). Effective CEOs and other big bosses will create sustainable value by getting the heck out of their offices, stop wringing their hands over stock prices and meaningfully create “side to side, networked” organizations that inspire people to thrive… ALL IN! 

Character Moves: 

  1. Assess whether you and your organization are “all in.” If not, why? Be honest! Where’s the evidence? 
  2. Please take 10 minutes to watch the following video. If that doesn’t inspire you, check your pulse and purpose.

All In The Triangle,

Lorne  

One Millennial View: I feel like I hear a lot of successful, happy people say something along the lines of “hey, don’t over think it.” In today’s Yelp!-like society, we’re likely going to get immediate feedback. People in great companies go to work and give it everyday. Being pleased, and pleasing people shouldn’t be that hard. But it does seem to be “over” thought sometimes. All it probably needs is a meaningful purpose, conditions for people to contribute, and their willingness to execute. 

– Garrett

Edited and published by Garrett Rubis.