One of my favorite things about RESULTS is working with the most interesting business leaders in the world. We have clients ranging from shipping providers to sports leagues. But when I read a recent study estimating that businesses waste USD $3 trillion a year on “excessive management,” I knew that out of all our clients, the ones who had addressed that problem the best are agencies.
Agencies deal with a unique set of challenges. They’re hired to come into a situation and provide high-level, high-impact work as if they were co-founders. If you hire an tax attorney, you expect them to understand exactly what’s going on, to care about it as if they were you, and to have the chops to solve your problem correctly the first time. If you hire an AdWords shop, you expect them to understand your market perfectly, to create ads that match your personal vision of your business, and to immediately drive sales.
In a business like that, margins arise almost entirely from efficiency. The less time it takes for an agency’s people to meet the client’s (often outrageous) expectations, the more billable hours the team can produce. Mistakes and re-work come directly out of their bottom line, just as excellence adds to it.
If you were managing an agency, what solution do you think you’d need? Most agency owners try to increase efficiency through processes. First off, they want to feed the excellence. They assume that a good process can be used over and over for different clients, letting their team get to the creative and intellectual stuff faster. At the same time, though, they want to avoid mistakes, and processes seem good for quality control.
Managers can spend a huge amount of time developing these processes and trying to make them succeed. That’s one cost, but not the biggest one. The assumption that a process used for one client can be applied to another rarely works out, usually resulting in wasted time and a more elaborate process. Similarly, quality control tends to become an approval process, and when that happens, the team member’s focus can shift from the client’s desires to the approver’s preferences. In both ways, processes can lead to excessive management.
The study above estimated that half of all internal compliance processes have “questionable value,”which you’d expect from this. But that’s just looking at the impact of the process. Things get really messy when you look at the cultural costs of excessive management overall. When everything has to go through a process or get approval, the nature of work changes, and your employee’s attitude towards it changes, too.
In an agency – or, I’d argue, in almost any business – when there’s too much process and too many approvals, it gives the impression that the “correct” way to serve a client has already been found. It gives the impression that the “correct” inspiration or solution already exists. A lot of enterprises realize they have a problem when they see this impact around them. Progress stops. Innovation stops. Everyone just tries to repeat the same thing over and over. For an agency, this translates into economic hardship immediately. For other businesses, it might take a little longer, but the same thing will happen.
So what do you do? You can’t just jettison your processes. They serve a constructive purpose. But you have to lessen their negative impact. The solution begins with asking how your employee’s attitude towards their work changed when your process became too much. What was different before that point? The answer varies at such a granular level we could say there’s a different answer for each job. But they all have one thing in common. Before the process ruined things, your employee felt free.
They could think creatively and toss out original ideas. They could wink and smile. They had their eye on the ball – serving the customer – and they were free to do the best they could. So why did you change that? Because it took too long, or because you got bitten and you didn’t want it to happen again. But now the process has shut down that employee’s creativity, and your customers aren't as happy.
To restore your employee’s freedom you have to become transparent about your processes. Bring them into the process of refining your processes. But here’s the secret: you have to do this correctly, or it will not work the way you want it to. Your process exists to speed things up and to prevent mistakes. So naturally, you’d tend to have your employee look at the things that took too long. You’d have them look at the mistakes that were made. You’d think to yourself that you’re respectfully inviting the employee to engage in some problem solving.
But that’s not what they hear, if you take that approach. All they hear is criticism of their work. There’s a reason some things take a long time, but you didn’t ask for it. Those mistakes were actually attempts at doing something interesting, but you didn’t ask about that, either. The employee doesn’t feel respected; they feel like their job is changing. Now they’re just expected repeat a process and avoid trouble. Boring.
Freedom to Succeed
Do this instead. High-performing enterprises give their people five times as much positive input as negative. For every criticism, they give five supportive, appreciative and encouraging statements. Five. That’s a lot more.
Take that attitude towards your processes. Focus your people on all the successes, all the things that worked, and all the contributions they made that their client loved. You want to make that happen more often.
Now you’re not looking to avoid mistakes. You’re looking to pursue excellence. This is the opposite of following a process. You and your team have the big picture in mind. You and your team know the pitfalls and you know how fast you need to work to be profitable. You also know how you want your customers to feel, and you know you’ll need to be creative to make them feel that way. Oh, and by the way, you’ll use a few processes to help out.
We've seen clients do this. The employee’s attitude transforms. They will accomplish far more in this state of mind than they ever will by repeating themselves perfectly.