Brewing Up A Learning Organization

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Reflective Blog 3

(An imaginary memo to the owner of a small but successful local brewery)

TO: John Whitney – President and Brewmeister, Whitney’s Gold Brewery

FROM: Adam Bernstein, Innovation Impact / Creativity Consultants

SUBJECT: Creativity & Innovation Initiative

John – It was a pleasure meeting with you last week and discussing a more intentional effort to integrate creative and innovative thinking into the internal culture of Whitney’s Gold Brewery. After reviewing your business plan and notes from our conversation, as well as interviewing several staff members, I have the following initial comments and recommendations.

Whitney’s Gold Brewery has achieved tremendous financial success and its personnel seem to be, by and large, satisfied and committed to their work. Screen Shot 2015-08-08 at 3.05.35 PMHowever, as you contemplate the next phase of growth, including opening a second location and expanding your product line, it is vital that you endeavor to create a truly “learning organization.” This is an academic term made famous by a management theorist named Peter Senge, who studied systems theory to determine how complex organizations function effectively. Senge believed that to have such an organization, management must create an internal culture characterized by holistic collaboration, active participation and sharing in decision-making. For this process to be effective, all workers must be committed to learning and self reflection (“personal mastery”); a common vision and understanding of their respective roles in achieving it (“concertive control”); and team learning (Eisenberg, E., Goodall, H., Trethewey, A., 2014, p. 109).

I recommend the following three activities designed to help your company become a learning organization:

Broadening Our View – You have a great and highly competent staff in many ways, but their collective perspectives and insight are limited to their work functions. In other Screen Shot 2015-08-08 at 7.20.34 PMwords, they may make the city’s best beer but your workers have a limited view of the broader business and social environment in which Whitney’s Gold operates. Another systems theorist, Karl Weick, called this an “enacted environment” and described it as potentially dangerous to an organization, since this scenario would leave you vulnerable to unseen or misunderstood developments. To combat the effects, I recommend getting a subscription to the local business journal for employees and adding a standing agenda item to weekly staff meetings where you discuss broader economic trends in the region (Eisenberg et al., 2014, p. 111).

Screen Shot 2015-08-08 at 3.12.08 PMSay “No” to Silos – Weick also examined why teams fail when facing adversity. (He wrote a very interesting case study about the Mann Gulch Fire Disaster in Montana in 1949, which you may find interesting.) One reason is a lack of personal connection among team members, something another theorist called “nondisclosive intimacy” (Weick, K. E., 1993). To overcome this problem requires thinking beyond explicit job functions and inspiring senses of mutual respect, trust, looser control over decision-making and strategic communications. I suggest creating cross-disciplinary teams within the brewery to address operational challenges. This would build teamwork and rapport by exposing workers in different areas to each other, showcasing respective talents and interests, and giving them a common challenge to attack together.

Personal Mastery – Another academic term coined by Senge, this means that each employee is committed to learning and self-reflection (Eisenberg et al., 2014, p. 109). I recommend that with my assistance, the company facilitates each employee reading “The Artist’s Way; A Spiritual Path to Higher Creativity” by Julia Cameron. This is an excellent resource for unleashing creative thought and expression.

My research on your behalf verifies that these three activities reflect the most current thinking about how to cultivate innovation within successful companies. Many experts recommend assertive and intentional efforts to communicate and achieve common vision, establish personal roles and accountabilities, and encouraging risk taking and Screen Shot 2015-08-08 at 3.14.21 PMnontraditional ideas and actions (Pitra, Z., & Zauskova, A., 2014, p. 14). As the leader of the company, you will play a key role in establishing credibility and instilling the confidence and support of your staff in this initiative. Following is great quote that I found from a recent journal article on the subject:

A good leader can do much to challenge and inspire creative work in progress. People are highly attuned to organization management’s engagement with and attitude toward an innovation project. Employees doing creative work are more motivated by managerial behaviour, even by seemingly little things like a sincere word of public recognition, than by financial rewards. Managers must decrease employees’ fear of failure that seems to rise with the scale of business. Any business that experiments vigorously will experience failure – which, when it happens, must be analyzed and dealt with to improve creative problem solving, team learning, and organizational performance (Pitra, Z., & Zauskova, A., 2014, p. 62).

John, I am confident that this scope of work will help transform Whitney’s Gold into a learning organization that is poised to overcome challenges and seize opportunities ahead. Look forward to discussing next steps.

QUESTION: What are the reasons that an organization might deliberately choose NOT to become a “learning organization?”  Is this approach sustainable? What are the potential negative effects of becoming a learning organization? 

References:

Eisenberg, E.M., Goodall, H.L., Jr., & Trethewey, A. (2014). Organizational Communication: Balancing Creativity and Constraint (7th ed.). Boston: Bedford/St. Martin’s. (ISBN: 978-1-4576-0192-7).

Pitra, Z., & Zauskova, A. (2014) Communication in Knowledge Transfer Management, Communication Today, 5(2), 50-65.

Weick, K. E. (1993). The collapse of sensemaking in organizations: The mann gulch disaster. Administrative Science Quarterly,38(4), 628. Retrieved from http://ezproxy.queens.edu:2048/login?url=http://search.proquest.com/docview/203920836?accountid=38688

The Crisis Within

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A crisis striking an organization can be analogous to a person having a heart attack; what happens immediately following will profoundly affect the patient’s ability to recover, if not survive.

When an organization makes a mistake, far more is at stake than a brand or reputation. The nature of the response could have real implications for public safety and wellbeing. A massive data breach compromised the private financial information of millions of Target customers. Manufacture and installation of defective Takata airbags jeopardized the safety of millions of drivers. The BP Deepwater Horizon oil spill threatened the
environment in the Gulf of Mexico and the livelihoods of hundreds of thousands of people who lived and worked in the region.

To be effective, the organization’s response to the crisis, in word and deed, must be timely, decisive and credible. Typically, it will convey an apology and acceptance of responsibility, acknowledgement of those adversely affected, explanations of what happened and why, reassurances as to the public’s safety, and steps to be taken to make sure the problem does not happen again.

Accepting responsibility for mistakes has been proven to be beneficial to the organization. The University of Michigan Health System reduced the incidence of medical malpractice suits filed against it in half after adopting a policy to proactively disclose known medical errors to patients who may have been harmed, and offering them corrective treatment or compensation (O’Connor, E., 2011, p. 9). Addressing the public’s safety and wellbeing and describing decisive action to correct the error and ensure that it is not repeated are also established best practices in crisis communications (Piotrowski, C., Gray, R., 2010, p. 97).

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Portraying sincerity and integrity is also vital. In the aftermath of the infamous Exxon Valdez oil spill in Prince William Sound, Alaska in 1989, the company received widespread criticism for downplaying the severity of situation, waiting ten days after the incident to apologize, and signaling its intent to raise gas prices to pay for the clean-up. Despite management’s efforts to demonstrate good faith and sincerity, the public did not trust Exxon’s motives, which contributed to huge and long-term legal, financial and reputational damage to the company (O’Connor, E., 2011, p. 11).

Organizations may signal their acceptance of responsibility for a mistake and response plans in myriad ways. For prominent corporations, a tried and true tactic is publishScreen Shot 2015-08-01 at 3.43.19 PMing a full-page advertisement in mass print media. Leaf through a copy Screen Shot 2015-08-01 at 3.42.47 PMof The Wall Street Journal or The New York Times on any given day and you are likely to see an example directly linked to a breaking story of high public interest, such as an industrial accident, act of corporate malfeasance, or product recall.

Full-page ads are primarily intended to reach external audiences that are key to the organization’s viability such customers, elected officials, regulators, investors, commentators, and even competitors; hence, placement in media outlets with large circulations and reach. But there is more to this organizational communications form than meets the eye.

Beyond conveying what the company wants external audiences to know about a situation, this mode of advertising has symbolic and rhetorical meaning for employees. It is a highly visible means for management to reassure workers about the integrity Screen Shot 2015-08-01 at 3.41.56 PMand the viability of the organization, and why it is important for these workers to remain loyal and committed. Clarke Caywood, a public relations professor at Northwestern University’s Medill School of Journalism, said: “Some of these ads are more for internal purposes than you might think. They take out frustration and they tell employees that the company is defending them” (Boyd, C., 2003, p. 2).

In his foundational Hierarchy of Needs, Abraham Maslow theorized that each worker’s evolution from satisfying basic psychological needs to self-actualization has beneficial effect for the organization. A crisis damages the internal culture by disrupting employees’ sense of wellbeing. In other words, a crisis knocks employees back a rung or two Screen Shot 2015-08-02 at 1.52.53 AMon the Maslow ladder. The organization will not fully recover unless management restores their confidence and sense of purpose, which realigns the goals of individual employees with that of the organization (Eisenberg, E., Goodall, H., & Trethewey, A., 2014, p. 82).

My paper (posted below) applies Maslow’s Hierarchy of Needs as a theoretical framework to demonstrate this concept, and introduces the format for a content analysis of the designated texts: three full-page newspaper ads placed by Duke Energy in response to the coal ash spill into the Dan River in North Carolina from one of the company’s coal fired power plants.

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When you see an example of one of these full-page “mea culpa” ads, what is your reaction? Do you find it credible or just the organization’s attempt to “spin” the story to its favor? How do you think its employees perceive the information?

References

Boyd, C. S.,Staff Writer. (2003, Jun 21). Mea culpa ads become new trend; Martha Stewart’s company is part of a wave of corporations to take out newspaper ads for Damage Control. Orlando Sentinel. Retrieved from http://ezproxy.queens.edu:2048/login?url=http://search.proquest.com/docview/279880059?accountid=38688

Eisenberg, E. M., Goodall, H. L., & Trethewey, A. (2014). Organizational Communication: Balancing creativity and constraint. Boston, MA: Bedford/St. Martins.

O’Connor, E. O. (2011). Organizational apologies: BP as a case study. Vanderbilt Law Review, 64(6), 1957-1991. Retrieved from http://ezproxy.queens.edu:2048/login?url=http://search.proquest.com/docview/914724861?accountid=38688

Piotrowski, C., & Gray, R., (2010). Cost/Benefit of Toyota’s media campaign during the recall crisis of 2010. Organization Development Journal, 28(3), 95-99. Retrieved from http://ezproxy.queens.edu:2048/login?url=http://search.progquest.com/docview/749237609?accountid=38688

Tending the Flock

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Are today’s HR practices really living out the ideologies of the human relations approach?

Although it sounds like a cliche, there is truth to the adage that an organization’s most important asset is its people. If you accept this premise, then it should be readily apparent why human resources (HR) departments came to be and remain necessary. The modern version serves a variety of functions that together are designed to ensure the viability of a vital asset or resource, i.e. the workers (hence the title “human resources”). This role and the attitudes that defined it are hardly consistent with the philosophical intent of the original human resources approach.

The main purpose of HR today could be loosely characterized as “tending the flock” of workers: administering their benefits, determining compensation, defining job descriptions, recruiting, hiring, managing layoffs, evaluating job performance, mediating disputes, providing professional development, and more.

Some of these functions are consistent with the principle of classical HR theory that holds that the prosperity of the organization depends in large part on its ability to enable what Maslow called “self-actualization” of its employees (Eisenberg, Goodall, & Trethewey, 2014, p. 82). For example, HR departments administer professional development programs and training, Screen shot 2015-07-26 at 5.17.08 PMand help manage each employee’s advancement up through the ranks. In that regard, the HR department fulfills the ideal of helping workers evolve to their fullest potential, by facilitating growth and otherwise bringing the organization’s resources to bear on their behalf.

But these roles are small and lower priority in comparison with other concerns for the organization, such as payroll and benefits management. Human resource departments today seem to be primarily in the business of recruitment and retention of workers. Promising self-actualization has become a means to these two ends, rather than a goal in and of itself.

Maslow theorized that the effort to achieve self-actualization inherently serves the organization by aligning its goals with those of its employees (Eisenberg et al., 2014, p. 82). Likert’s principle of supportive relationships places a high value on employee engagement and “participative management” within the organization (p. 85). Of course, the reaScreen shot 2015-07-26 at 5.02.40 PMlization of both ideals is often undermined by politics, power, privilege and other factors in organizational cultures. For example, practical reality in the workplace (if not society at large) holds that although everyone may be considered equal, some are “more equal than others.” In other words, lower level workers may have a harder time becoming self-actualized than managers and other personnel viewed as more talented or valuable to the organization.

The human resources approach places a high priority on employee wellbeing and engagement, essentially promising that if management put the needs of the worker at the forefront in most if not all decisions, the organization will prosper. But most organizations today treat employees less as their most important asset worthy of that consideration, and more like a commodity. The evidence is writ large in business news feeds every day. When a company is in financial trouble, layoffs are the most likely first step management takes in the attempt to improve profitability. Senior executives rarely put the needs of employeesScreen shot 2015-07-26 at 4.59.48 PM first or engage them in finding solutions to problems (never mind accepting a pay cut themselves) before taking steps that directly affect the workers’ livelihoods such as cutting benefits, closing plants or divesting divisions. Those don’t sound like behaviors that are consistent with the theories of Maslow, McGregor or Likert.

Unfortunately, contemporary HR practices largely reflect the mentality of workers as being expendable, which is far removed from human resources ideology. Rather than strongly advocating for workers and their active and vital involvement in organizational affairs, the HR function is often little more than maintaining the herd and doing management’s bidding.

Is it an appropriate role of an organization to overtly help each employee self-actualize, or “be all they can be?”  Further, is it appropriate for an organization to tie its prospects to the worker’s ability or desire to self-actualize? 

REFERENCES:

Eisenberg, E.M., Goodall, H.L., Jr., & Trethewey, A. (2014). Organizational Communication: Balancing Creativity and Constraint (7th ed.). Boston: Bedford/St. Martin’s. (ISBN: 978-1-4576-0192-7).

Classical Management in Modern Organizations

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Despite tracing its lineage back to the early 19th century (if not before), the classical theory of management is alive and well as a prominent form for today’s organizations of all types. Many corporations, businesses, non-profits, public agencies and other entities reflect the trademark principles espoused by the theory’s adherents Frederick Taylor, Henri Fayol, Max Weber and others, such as division of work, reporting discipline, unified direction and order.

Practically speaking, this predominance is not likely to change. Organizations will be hesitant to adopt radically different forms due to an aversion to change generally, and especially if such change threatens two things that people most cherish, power and wealth. Regardless, the viability of classical management, at least in its purest form, for contemporary organizations is questionable.

As evidence of this position, I can cite the many organizations, large and small, in various sectors that I have encountered during a 30-year public relations career. It seems as if every one used a classical management approach with relatively minor variations, and with varying degrees of success. One client, a law firm, is a good illustration.

The firm structure was typical for contemporary law firms. At the top of the organizational chart were the executive board and managing partner, followed in order by the equity partners, department chairs, practice group leaders and associates at the bottom. As this structure suggests, the firm grouped attorneys by departments and areas of practice specialties (in the modern law firm, there are almost no generalists), reflecting Fayol’s principles of management such as division of work and unity of command and direction (Modaff, Dewine, & Butler, p. 31).

The non-attorney support staff constituted its own separate, sub-organizational structure managed by a chief operating officer who reported directly to the managing partner. These staff members included paralegals, legal secretaries and personnel who handled marketing, technology, human resources, facilities, and other specialized operational functions.

Over decades, this law firm achieved respect and consistent profitability with an organizational structure that changed little. In that respect, a classical management approach could be deemed an operational success. However, there were signs that the model was not viable or optimal, especially for non-legal staff. Management allocated comparatively little for their professional development compared to attorneys. This violated the element of Taylor’s theory of scientific management that prescribed “careful selection and training of the best workers” (Modaff et al., p. 27) as well as the principle of equity in Fayol’s Administrative Theory (p. 31). Counter to Weber’s chain of command and Fayol’s Scalar Chain, authority was confusing and often politicized, as equity partners sometimes exerted inordinate influence over matters such as work assignments and compensation regarding non-legal staff and associates, including those they did not supervise (pp. 32, 37).

Certain aspects of classical management would seem to make sense for law firms, such as division of work, unity of command and direction, reporting discipline and esprit de corps (Modaff et al., pp. 31-32). But there is a big difference between theory and application. In my personal and professional experience, the mentality of many lawyers does not complement these concepts. The “billable hour” metric can make lawyers self-focused and less inclined to subordinate their personal interests to the common good (p. 31). Some lawyers can be difficult to manage, especially if they are made answerable to a peer, and many do not accept the premise that trained managers are better qualified to make decisions about the business aspects of the firm. These and other sentiments suggest that some lawyers may not be adherents to either the spirit or letter of the law regarding Fayol’s five Elements of Management: planning, organizing, command, coordination and control. (pp. 34-35).

Moreover, legal work may be too complex to accommodate scientific management techniques that are best suited to “straightforward task situations that require no flexibility in responding to contingencies and that offer no opportunities for initiative” (Eisenberg, Goodall, & Trethewey, 2014, p. 72).

For classical management techniques to be truly viable, managers must heed the enlightened intent of theorists who were as concerned about fairness, respect, morale and job longevity as productivity and efficiency. This is a very tall order. Consider Home Depot, one of the world’s largest retailers, where CEO Robert Nardelli is applying classical management techniques with, quite literally, militaristic precision. Improved profitability and cost efficiencies indicate some success. But after five years of effort, Wall Street remains unconvinced while his approach has created a “culture of fear” among “demoralized” managers and line staff, with a corresponding toll on customer service (Grow, Brady & Arndt, 2006.).

The implications are clear: without proper balance that places equal value on the human condition of the workers, classical management’s applicability and relevance for modern organizations will remain limited.

Classical management theorists worked in periods when social understanding of power and privilege were very different from what we know. Yet their work implies certain egalitarian ideals that, at least theoretically, are still relevant. Would their concepts have been different if they were working today?  How?

REFERENCES:

Eisenberg, E.M., Goodall, H.L., Jr., & Trethewey, A. (2014). Organizational Communication: Balancing Creativity and Constraint (7th ed.). Boston: Bedford/St. Martin’s. (ISBN: 978-1-4576-0192-7).

Modaff, D.P., DeWine, S., Butler, J.A. (n.d.). Organizational Communication: Foundations, Challenges, and Misunderstandings (2nd Ed). Boston: Pearson.

Grow, B., Brady, D., & Arndt, M. (2006). “Renovating Home Depot.” Retrieved from http://www.bloomberg.com/bw/stories/2006-03-05/renovating-home-depot.