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The self-defeating organizations

Smart companies outsmarting themselves

By M. Afzal Janjua
Sep 11 - 17, 2000

Like individuals business organizations also face crises and challenges even after gaining maturity. How they respond in such situations depends upon their Core Beliefs. If core beliefs are positive then the organization responds in a positive way and if these are negative, fear of perpetuating low performance sets in. Again if this fear is healthy then the organization may find a cure but if this fear is mythical, it will set the organization reeling down the road to low performance.

The core belief system has to be developed by the top management. It is the lens through which the organization sees itself. The core beliefs generate "Descriptive Beliefs", i.e., nature of business, goals, market etc. and "Evaluative Belief", i.e., wisdom, fairness, honesty and quality etc. Sound Core beliefs will result into valid descriptive and evaluative beliefs, while unhealthy core beliefs will give way to negative descriptive and evaluative beliefs. Low performance, comes through
(i) Reaction (ii) Replication (iii) Absorbing Costs (iv) Minimizing (v) Blaming or Scapegoating. Positive Core beliefs result into high performance, because of (i) Truth telling (ii) Open mindedness (iii) Sharing benefits (iv) Maximizing and (v) owning success.

Self-defeating organizations
The business world is full of examples of self-defeating organizations. Interestingly, these are not inactive organizations, but smart enough to outsmart themselves in certain ways.

Here the story of George (fictitious name) is relevant. He was sent to 'fix' an Investment Company that was showing losses. He was a typical character and manager. He started weekly meetings, showed tough attitude, and insulted executives in the meetings. These weekly meetings ultimately became the main concern and when he left, the company was in greater mess. Some key personnel had left, before him and unhappy clients had gone to competitors.

The symptoms of self-defeating organizations are:-

  • Confusion

  • Secrecy

  • Deceit

  • Insecurity

Territorialism (re-organization re-staffing, transfers) from one territory to another.

  • Cynicism

  • Boosterism

  • Rationalization

  • Scape goating

The self-defeating companies can be classified as under:-

i) "Maintenance Crew" Controls, Procedure, guidelines, manuals, Flags (PUC/DFA etc;) are more important than business results

ii) "The Funhouse gang" Activity is more important than productivity. Too busy little result. Meetings, Conferences, Discussions consume much time.

iii) The Pepsquad Slogans, Banners, Posters to show optimism take precedence over real action. Positive talk is not followed by action.

iv) "The Alumni Club" Remembering the past glory, previous leaders, good old days and foregeting realities.

v) "The Cargo Cult" Changes, floor shifting, developing future scenarios, ignoring today's needs/challenges.

These characteristic give rise to different behaviours, resulting in self-defeat.

The remedy
Taking a realistic look at the organization's core beliefs, and characteristics is very important. There are different types of counseling approaches needed for different characteristics.

A. The Maintenance Crew
Being dependent upon systems and procedures it is in fact an internally depressed organization. It needs motivation and cheering up in a realistic way with measurable targets.

B. The funhouse gang
They need an efficiency expert to highlight the need for efficiency, against activity. However, activity cannot be ignored. It should be purposeful, well planned as well directed. "Individual Shows" should be avoided and collective achievement should be encouraged.

C. Pep squad, Alumni Club and Cargo Cult

They also need counseling depending upon their needs. Analyzing and describing how the resources are being utilised in the routine of daily activity is essential. Attention should be shifted to the present moment rather than, past or future scenarios.

4. The real solution:
The real solution is identifying, the core beliefs, fears, characteristic and remedies by the top level of management. Internal Counselors can be helpful but external counseling should not be ignored. The danger of falling into the trap of well bound, colourful, attractive and overly well worded philosophical approaches usually adopted by external experts must be avoided. Maintenance of balance, fairness, good values, policies and systems based on merit followed by critical evaluation of performance will help avoiding self-defeating characteristics.