BOSTON, MA--(Marketwired - Nov 19, 2014) - Managers like to control people and processes. And most management approaches are designed to give them more control. But that can sometimes be a mistake.
The best managers know when to give up control and distribute it to others. And they don't always get upset when people don't do what they're told. Sometimes they even celebrate "disobedience." They know that when people act on their own, they can make the organization more agile, more responsive, and better able to compete in a complex business environment,
Giving up control is one of the ideas at the heart of Six Simple Rules: How to Manage Complexity Without Getting Complicated (Harvard Business Review Press, 2014), a new book by Boston Consulting Group (BCG) senior partners Yves Morieux and Peter Tollman.
The rules show managers how to go beyond the traditional management toolkit and instead embrace "smart simplicity" -- a set of principles designed to make people more autonomous, cooperative and better able to solve problems, so that organizations become more competitive. The book argues that autonomy and cooperation are essential if organizations are to respond effectively to the demands of an increasingly complex business environment.
One way to make organizations more effective is to stop hoarding control and distribute it broadly. This enables people can act autonomously, Morieux and Tollman say.
"People who act on their own are acting rationally to solve problems," Morieux says. "If you allow them to act, they will identify problems you didn't know you had and arrive at solutions you might not have thought of."
"It's understandable that managers want more control," says Mr. Tollman, " but in order to achieve it and centralize it, they create systems and processes that make an organization slow and cumbersome. The organization becomes complicated, and a complicated organization is not well equipped to respond to complexity: A fast-moving, volatile business environment with many, often contradictory requirements and rapidly shifting demands."
Distributed Control Creates Advantages
When control is instead broadly distributed, complex rules and procedures become unnecessary. "When many different people and groups have control, direct feedback loops emerge," Morieux says. "In these feedback loops, people react to each other's misbehavior and correct it quickly. There is much less need for rules and procedures - there is instead a mechanism in which people and groups respond rationally to feedback and do what's naturally right for themselves and the organization. The entire organization becomes faster and more agile."
The Problem with Centralized Control
According to the authors, centralized control is the focus of most management approaches. Most organizations follow one of two main approaches, or sometimes both at once:
- The "hard" approach, which involves creating new structures, processes, systems and financial incentives -- and ways of measuring them. "The hard approach assumes systems are predictable and people are weak and unreliable," Morieux says.
- The "soft" approach looks at human factors and tries to create a more harmonious working environment through team building, retreats and emotional incentives. "This approach also tries to control people, by catering to their psychological needs," Tollman says.
These approaches create complicated structures that make organizations complicated, slow and unresponsive, Morieux and Tollman say.
Managing with Distributed Control Yields Greater Agility
"What's often needed instead is a different way of managing," Morieux says, "one that aims for less direct control than do the hard and soft approaches. The goal should be fewer systems, more flexibility and more autonomy, so that people and groups can generate their own feedback without reliance on formal rules and processes. An organization with these features is nimble - and better able to respond to complexity because it better leverages people's judgment and energy. It achieves smart simplicity."
The book includes examples of organizations that gave up control and got better as a result:
- A major hotel chain gave receptionists, not supervisors, control over housekeepers. This allowed the receptionists to act directly to handle customer complaints about rooms that needed maintenance or were made up late. The new approach allowed the hotel to turn rooms over faster, fix problems and increase customer satisfaction.
- A retailer that store managers, not department heads, control over staff from other departments. This gave the managers more leverage to persuade staff to cooperate in staging promotions that turned performance around.
- A European passenger railroad stopped punishing workers and departments that caused delays -- and instead rewarded those that acted independently to call attention to the problems so that others could also act autonomously, changing schedules and identifying solutions.
"To determine when and where to give up control, managers should first find out what's really happening in the organization," Tollman says. "Learn how and why your people cooperate, find resources and solve problems -- or how and why they fail to do so. Remember that whenever they cooperate or fail to cooperate, they are acting rationally to look after their self-interest. If what you want them to do is harmful to themselves, then you need to change the conditions so that it's in their self-interest to do what you need. That often involves reducing requirements and simplifying systems so they can focus on the tasks that really matter to the organization that can entail a bit of 'disobedience.'"
For more information, or to schedule an interview with Yves Morieux or Peter Tollman, contact Frank Lentini, Sommerfield Communications at +1 (212) 255-8386 / Lentini@sommerfield.com .
About the Authors
Yves Morieux is a senior partner in the Washington, DC office of The Boston Consulting Group (BCG). He is a BCG Fellow and director of the BCG Institute for Organization.
Peter Tollman is a senior partner in BCG's Boston office and is a former leader of BCG's People & Organization practice in North America.
About The Boston Consulting Group
The Boston Consulting Group (BCG) is a global management consulting firm and the world's leading advisor on business strategy. We partner with clients from the private, public, and not-for-profit sectors in all regions to identify their highest-value opportunities, address their most critical challenges, and transform their enterprises. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustainable competitive advantage, build more capable organizations, and secure lasting results. Founded in 1963, BCG is a private company with 81 offices in 45 countries. For more information, please visit bcg.com.
Contact: Frank Lentini Sommerfield Communications, Inc. (212) 255-8386 lentini@sommerfield.com
