Effective Organizations Newsletter

Effective Organizations Build Resiliency; Capitalize on Failure

How many times have we seen professional athletes come back from serious injury only to perform even better than they did prior to the injury? Think about Minnesota Vikings running back, Adrian Peterson, who suffered a season ending ACL/MCL knee injury on December 26, 2011. Peterson fought back to start in Week 1 of the 2012 NFL season and ultimately finished just nine yards short of breaking Eric Dickerson’s single season rushing record!

There is something about adversity that, for champions, increases desire to succeed rather than desire to give up.

The same is true for highly effective organizations, i.e. they are resilient. They bounce back from significant (even catastrophic) events to resume the same or even better performance than they had prior to the adversity. They use the adversity as a catalyst to innovate and improve.

Break Through or Break Down

Why do some organizations demonstrate resilience while others collapse in the face of adversity? The simple answer to this question is that the resilient have already created a culture based on the characteristics that we have been discussing throughout this 2013 newsletter series. Resilience is not a characteristic that can stand alone, but rather is the result of creating an environment of effectiveness that can not only withstand adversity, but can improve because of it.

Let’s review the other 10 characteristics of an "Effective Organization" in light of what they mean for resiliency.

1. Clearly define and communicate mission, goals, values, and expectations.

  • In the face of adversity, resilient organizations stay true to their purpose, but not necessarily to their strategy.
  • That is, they find another way to achieve their reason for existence rather than stubbornly adhering to the way they have done it in the past.
  • In other words, they innovate.

2. Align all aspects of the organization including people, systems and processes.

  • In the face of adversity, resilient organizations re-align the organizational components with the new strategy.

3. Model and develop Facilitative-Relational Leadership throughout the organization.

  • Leadership style doesn’t change because of difficulty, rather it becomes even more manifest.
  • In the face of adversity, facilitative-relational leaders actively solicit ideas from team members in an attempt to identify the most effective tactics and to increase commitment from those required to implement those tactics.

4. Hold everyone accountable with both positive and negative consequences for results.

  • Resilient organizational leaders understand that accountability, not blame is the key to improvement and success.

5. Build a collaborative and empowered environment based upon teamwork.

  • Just as in the “good” times, “hard” times require that people work together and make judicious and timely decisions for success.
  • Organizations that already have this type of environment are more likely to weather difficult situations.

6. Tolerate appropriate risk taking and learn from both success and failure in an attempt to be innovative.

  • Effective organizational leaders understand that while implementing a new or modified strategy there will be risks and that there will be both successes and failures.
  • They also understand the need to learn from failure and to celebrate success.

7. Focus on meeting customer expectations and needs.

  • Customer focus is essential to success all the time, but especially in the face of adversity.
  • Understanding the customer's perception of the organization's response to that adversity is critical to both the development and implementation of the new strategy.

8. Create a culture based on honesty, integrity and mutual respect.

  • It goes without saying that trust is the basis for success and organizations that have it are much more likely to succeed in the face of adversity than those who don’t.

9. Identify meaningful measurements and timely feedback.

  • Strategy change often requires different measurements to determine how the strategy is working and likewise requires feedback to determine whether change is required moving forward.

10. Insist on open communication throughout the organization.

  • It is very easy to become focused when times are tough and to forget to communicate, but resilient organizations are diligent in increasing communication when faced with adversity.
  • Leaders understand that failure to communicate will create an environment of “guessing” and much of the time that guessing is wrong and counter productive.

What's the point?

Organizations that are effective in the good times are much more likely to have created a culture that will respond effectively to adversity. There is a good chance that they will become even better because of the adversity. Those organizations that are not effective in the good times will be much more likely to fail when the times get tough.

Effective Organizations Insist on Open Communication throughout the Organization

While it can certainly be argued that revenue is the “life blood” of an organization, it can also be argued that communication is the Central Nervous System (CNS). Just as with the human body, without a functioning CNS the blood will not flow. The CNS (effective communication) creates a connection with every component of a healthy, effective organization and allows the individual components to function as a whole. My physician friends could probably find holes in my analogy, but I think it makes the point that without effective, open and flowing communication throughout the entire organization there will be a higher probability of system failure. Leaders of effective organizations understand the critical importance of open, clear and flowing communication to the success of their organizations and they insist on it.

For 30+ years we have asked our students in both management and communication courses to tell us why they think communication is so important and we always get responses like the following:

  • You can’t get good results without it.
  • It is central to being both efficient and effective.
  • You can’t have a high level of job satisfaction without it.
  • It is the key to providing quality products and services.
  • It is the key to creating a safe workplace.
  • It keeps everyone going in the same strategic direction.
  • It is critical to healthy relationships.
  • It is critical to happiness.

...just to name a few. The value of open communication has been easy enough for our students to identify, but experiencing those benefits requires intentionality -- at the individual and organizational level.

Hardware & Software

Open communication involves the flow of information between departments and individuals that is required to achieve the results needed for organizational success. To accomplish this, effective leaders put in place the communication hardware needed within the organization. Highly effective organizations also provide the necessary communication software in the form of training to utilize the hardware and to deal effectively with the conflict that can arise in the normal flow of everyday work life.


Effective leaders know that conflict, if handled well, can lead to innovation. They also know that if conflict is not handled well it can lead to organizational failure. They know that when people are not talking, they are usually “guessing” about the intent behind the actions of other people and that those guesses are usually negative and thus conflict producing. So to deal with the conflict before it can create failure, they teach team members to:

  • stop the guessing
  • ask to determine true intent
  • and then resolve the conflict in a mutually beneficial manner.

If you have attended either our SafetyCompass® or PerformanceCompass® training, you will recognize this as the SAFE process for dealing with any form of failure. This applies to dealing with unsafe actions, but it also works when dealing with conflict.

What's the point?

Understanding that our bad guesses can lead to closed communication is the first step to helping to open up communications within an organization. This process is what “open communication” is really all about.

Effective Organizations Identify Meaningful Measures and Provide Timely Feedback

There is an old saying in management circles that “you won’t predictably get what you don’t predictably measure”. Likewise, “you can’t measure what you don’t define.” Effective organizations do both.....they define and measure. In Effective Organization Characteristic #1, we discussed how effective organizations communicate not only mission, goals and values, but also performance and results expectations as a means of providing a clear definition of what results are expected. This definition and communication of expectations occurs throughout the organization, from top management down through the front lines.

Individuals must understand how their performance fits into the overall performance of the organization and what specific results are required for that to occur. This requires that managers and supervisors make sure that their employees understand those expectations through regular and effective dialogue. While definition of expectations is absolutely required for effectiveness, measurement of and feedback concerning performance is also critical for success of both the individual and the organization.


Measurements can be either qualitative (no numerical value) or quantitative (based on numerical value). Most organizations use both, but those that are highly effective focus decision making on quantitative measurements of performance. They identify particular measurements that are associated with achievement of their objectives and monitor those measurements over time. These measurements are often referred to as “Key Performance Indicators (KPI)” because they are central (Key) to evaluating the effectiveness of various efforts, both at the individual and organizational levels.

Leading & Lagging Indicators

Performance measurement can, and should focus not only on the output (results), but also on the process of achieving that output. Effective organizations actually focus more on what are referred to as “Leading Indicators” associated with the process than they do on “Lagging Indicators” associated with the output. They are obviously interested in final results but they understand that the success of the process is directly related to the success of the output.

For example, when attempting to impact safety performance, effective organizations measure Leading Indicators such as frequency of engaging in specific unsafe behaviors and frequency of intervention by another person when observing a person engage in an unsafe action. These Leading Indicators are related to Lagging Indicators such as Total Recordable Incident Rate (TRIR).

These effective organizations find that reducing unsafe behavior through intervention by another person leads to the desired reduction of TRIR and thus are better measurements of safety performance than TRIR. The key is to evaluate the result desired and the process for achieving that result with the use of KPI’s that are meaningfully associated with that result from both a leading and lagging perspective.


If no one knows the results of the measurement, then the measurement will have no effect on future performance. It would be like trying to adjust your speed in an automobile to the legal posted speed without looking at the speedometer. You might get close but you would probably not be as close (effective) in driving the speed limit as you would if you monitored your speed quantitatively.

Effective organizations identify methods for allowing employees to get regular and predictable feedback on performance (KPI’s) for both personal and organizational performance. In Effective Organization Characteristic #4, we discussed how effective organizations hold people accountable for results in the sense of “accounting” for and understanding why those results were achieved. This accounting requires both measurement of performance and feedback about the results of that measurement.

Feedback, as with accountability, does not require the application of a consequence (either positive or negative), however a consequence may be associated with the feedback as appropriate. For example, when you monitor your speedometer while driving there is not always a consequence unless you happen to be speeding and a police officer is also monitoring your speed. Your measurement (monitoring) may, however, result in a correction to the legal speed prior to a ticket.

What's the point?

This is what effective organizations do. They monitor performance at all levels and provide appropriate, quantitative, predictable feedback that will lead to the best performance and results possible.

Effective Organizations Create a Culture Based on Honesty, Integrity, and Mutual Respect

Our 2013 Newsletter Series examines the Top 11 Characteristics of "Effective Organizations". To qualify for this distinction, an organization must not only meet its stated goals and accomplish its stated mission, but the mission and goals must be ones that people would want to invest in and/or participate in because they bring superior value to not only the individual, but also customers and society in general. So far we have seen that an Effective Organization:

#1 -- clearly defines and communicates mission / goals / values / expectations

#2 -- aligns all aspects of the organization including people, systems and processes

#3 -- models and develops Facilitative-Relational Leadership throughout the organization

#4 -- holds everyone accountable with both positive and negative consequences for results

#5 -- builds a collaborative and empowered environment based upon teamwork

#6 -- tolerates appropriate risk taking and learns from both success and failure in an attempt to be innovative

#7 -- focuses on meeting customer expectations and needs.

This month we will look at how an Effective Organization:

#8 -- creates a culture based on honesty, integrity and mutual respect.

Honesty & Integrity

Let’s start our discussion by focusing first on honesty and integrity. What does it mean to have a culture based on honesty and integrity? We tend to think of honesty as “telling the truth” and integrity as “doing what you say you will do”. I once heard someone define integrity as “doing what is right even when no one else is watching” and I think that is a really good working definition of the term.

Have you ever worked with someone that you didn’t trust because that person told you one thing and did another? Maybe it only happened on one occasion, but sometimes it only takes one violation of trust to create distrust. As a customer, have you ever been promised one thing, but gotten something else? How did this make you feel about patronizing that company again?

Effective organizations are built on a foundation of honesty and integrity because their leaders know that this creates an environment of trust both within the organization and with those that do business with the organization. Leaders know that the willingness of their employees to follow them and of customers to patronize them is determined by the level of trust that those employees and customers have in them.

These leaders also know that this is a result of a history of them meeting expectations that have been clearly articulated and communicated. In effect, this creates an environment where employees are willing to follow leadership because they can predict outcomes.....an environment where customers are willing to pay money for goods or services because they can predict outcomes.

Moral & Ethical Behavior

Honesty and integrity also require moral and ethical behavior as a component. These concepts are difficult to define, but at a minimum include a set or code of accepted values and principles that follow not only legal requirements, but also take into consideration the impact that decisions have on others, both internally and externally. Honest people and organizations are those that are seen to consistently and predictably abide by society’s accepted code of morality and ethics even when faced with the opportunity to violate that code. Unfortunately, history is full of examples of people and organizations that have violated society’s legal and moral code. Fortunately, leaders of effective organizations do not usually appear on that list.

Mutual Respect

Effective organizations also attempt to create a culture based on “mutual respect”. Mutual respect is an outward and reciprocal regard for the dignity of another person. It is demonstrated by the way two or more individuals interact, especially when communicating with one another. It involves an attempt to understand the views and feelings of another person and the other person doing the same in return. It involves not only attempting to understand views and feelings, but doing so in a manner that communicates interest through the way we look (body language), what we say (our words) and how we say it (tone of voice). Mutual respect does not mean always agreeing with, or even liking others....it means ensuring mutual opportunity to express views while maintaining one's dignity. Failure to engage in mutual respect very often leads to friction, conflict, and ultimately organizational (and even personal relationship) failure. If you don’t believe this, just Google “divorce attorneys” and see how many hits you get!

What's the point?

Our introductory definition of "Effective Organizations" makes the case for honesty, integrity and mutual respect -- bring superior value to not only the individual, but also customers and society in general. While value is most easily seen from a financial perspective, it is most clearly felt by internal and external customers in the way they are treated -- especially when nobody is looking.

Effective Organizations Focus on Understanding and Exceeding Customer Expectations

If you work in an organization, you have customers. Your coworkers are your “internal” customers and their performance in many instances is dependent on your performance and support.

If you sell anything (product or service), the people who pay you are your “external” customers and their willingness to continue paying you is dependent on their perception of the value that you provide.

Both internal and external customers are important to success and leaders in effective organizations understand this.

Customer Service

Customer service is what you do to meet or exceed customers' expectations in an attempt to create customer satisfaction both internally and externally.

Many of The RAD Group’s external customers are in the service business and everyone of them has a stated objective of providing “service quality” to their customers. When we ask them to define their customers' views of service quality, they often hesitate and say that they really haven’t asked them.

If service quality is a significant component of customer satisfaction, then it would seem that understanding the customers' expectations in this realm would be critical to success.

"Because Knowing is Half the Battle!"

So the first step to customer satisfaction is to understand the customer's expectations, but how?

It’s really pretty simple, Ask and Listen!

The asking part can be done either informally, in conversation with the customer, or formally through surveys. I don’t know about you, but it seems that every time I buy something at a store, the cashier circles a web address for me to complete a customer satisfaction survey for a chance to win something. These organizations know that if they don’t understand what drives me to buy from them, they will have less chance of meeting my expectations and I will most likely take my business somewhere else.

How many times have you been in a restaurant and had your server stop by your table to see if you need anything or if the quality of the food met your expectations. They are simply asking to understand customer expectations. They also know that you feel valued (and consequently more satisfied) when your opinion is valued.

Don't Listen for Validation

The listening part is also really pretty simple, but many times difficult to execute. If your objective is to get validation that what you are doing is correct, you will probably stop listening to criticism and only focus on positive feedback.

Effective organizations know that the opportunity for improvement lies in the criticism and not in the positive feedback. When they get criticism, they take that opportunity to explore even deeper to determine what is causing the failure to meet expectations.

Train Employees to Value Feedback

Effective organizations don’t leave customer service to chance, but rather train employees on how to meet or exceed customer expectations.

At a minimum they teach their employees to be Helpful, Courteous and Knowledgeable. Really effective organizations teach their employees how to monitor customer perceptions through Observation and then how to Ask and Listen.

Deal Effectively with Complaints

Effective organizations also teach employees how to deal effectively with complaints.

They teach them that complaints are simply a symptom of failure to meet expectations and that exploration of the complaint is an opportunity to improve their service or product in the future. This means more success for the individual and for the organization.

What's the point?

Effective organizations don’t stop with simply meeting customer expectations, they “Go the extra mile” and, where possible, attempt to exceed those expectations. But they also understand that exceeding expectations starts with understanding those expectations in the first place.

Effective Organizations Tolerate Acceptable Risk and Learn from Success & Failure in an Attempt to Be Innovative

Risk is a natural part of life. Just about every decision that we make has some level of risk associated with it. Some risk is inconsequential, such as the decision regarding the color of the shirt that you decided to wear this morning. On the other hand, some risk can have significant impact on you and those with whom you associate, e.g., whether you ask a specific person to marry you or not. We start taking risks from a very early age and if we didn’t, we would probably never learn how to walk! Without some level of risk, things would never change or improve and effective leaders understand this.

Do You Value Initiative?

We often ask our Performance Management course participants whether they would rather have employees who show initiative or those who just do what they were told to do. They always respond with “I want employees who show initiative”.

But initiative is a form of risk-taking because the decision that the employee makes could be wrong and negatively impact desired results.

Clarify "Appropriate Risk"

Effective leaders are careful to clarify what they mean by “appropriate” risk taking and consistently encourage both initiative and innovative thinking while helping employees understand what is appropriate by helping them understand the potential results of both failure and success.

Understanding Context

We work with many organizations to help them improve performance and especially safety related performance. We know that the decisions that people make, both safety and non-safety related are driven by their understanding of contextual factors including themselves, others, the environment and the organizational systems.

Local Rationality

We have discussed before in other newsletters and articles the concept of “local rationality” in that our decisions make sense to us given our interpretation of the context and the associated risk. For example, we may make a decision to forego wearing safety glasses because we are being rushed by our supervisor to get the job done quickly and safety glasses are not readily available. We accept the risk of possible injury because the risk of displeasing the boss is seen as greater in the moment (local rationality).

Creating a New Context

Effective leaders attempt to create contexts that control factors (pressure to rush) that can lead to poor decision making (not wearing safety glasses) while increasing the chances of effective and even innovative decision making (coming up with a plan to both wear safety glasses and get the job done quickly).

They do this by encouraging active dialogue about the workplace (context) and ways to improve that context to encourage employees to take initiative (appropriate risk taking).

Contextual Analysis

Effective Leaders evaluate why both success and failure occur within the organizational context and do so without assuming poor motivation as a starting point. (See May newsletter for further discussion of contextual analysis and accountability).

What's the point?

Effective Organizations are filled with individuals who make good decisions about acceptable risk (initiative) because their leaders have created an organizational environment (context) that assists in that decision making.

Effective Organizations Build a Collaborative and Empowered Environment Based upon Teamwork

Highly effective organizations are composed of highly effective teams. Leadership in these highly effective organizations are intentional in the development of those teams and utilize two key tools to aid in this development: Collaboration and Empowerment.


A collaborative environment is one in which members work together to solve problems and to create and implement new ideas. It is based on the notion that through the sharing of ideas and effort, other, better ideas and results can be attained. Additionally, it is based on the notion that common purpose (i.e., the achievement of better results) and shared respect for one another will lead to unselfish contribution and support of and from other team members.

In a collaborative environment, team leaders make sure that objectives are clearly stated and understood by all team members and that shared respect is always present. If disrespect occurs, these leaders are quick to address the issue, determine the cause and re-establish an environment of shared respect.

Team leaders are also quick to recognize the combined efforts of their team members and reinforce those efforts. Collaboration is really the opposite of competition because in collaborative efforts everyone is a “winner” and no one is a “loser”, whereas in competition their is always a winner and a loser. In competitive environments the tendency is for the loser to either become less motivated to participate, or more motivated to “get even”, neither of which leads to better results.

Collaborative teamwork is like basketball where “assists” are just as important as shooting because without the assists, the shots will be less likely to score points for the team.

Collaboration also increases “ownership” by team members because each one has input into the process and thus “owns” a piece of the effort and the result.


Within these collaborative environments, leaders empower their employees and teams by giving them the opportunity to take initiative and make decisions without “getting permission” first.

Empowerment is based primarily on “trust” that the empowered person will make a decision that is in the best interest of the team and one that will achieve the stated objective.

Empowerment is always relative to the ability and motivation of the individual being empowered. It is based on the understanding that the empowered person has the knowledge, skill, motivation, etc. to make the “right” decisions and execute effectively on those decisions.

Empowerment does not mean “lack of accountability”. Remember our discussion of this topic in our May Newsletter (Effective organizations hold everyone accountable for both positive and negative results). If failures do occur, empowering leaders do not automatically assume that the failure was a result of poor motivation, but rather assumes that the person gave his or her best effort and then explores for the “real” cause(s) for the failure.

If the failure was motivational, then the leader attempts to understand the factors underlying the lack of motivation before attempting to motivate the person. If the failure is not motivational, the leader then works with the person to develop a plan to prevent the failure from occurring again. Failure is seen as an “opportunity” to improve and reduce the chances of additional failure going forward. It is never seen as an opportunity to lay blame.

What's the point?

Empowered employees have a greater sense of satisfaction in their work, a greater sense of ownership and an increased willingness to work together. Ownership increases the likelihood that the employee will exert the effort necessary to achieve success.

Effective Organizations Hold Everyone Accountable for Both Positive & Negative Results

Effective organizations know that accountability is a primary key to getting the results that are expected and therefore, success. Quite simply, people tend to focus on what is getting measured and this measurement serves to both motivate action and improve performance. To complicate matters, organizations that would not be described as "effective" also value accountability. They just don't value the same kind of accountability. Humans are hardwired with a sense of the value of accountability. From an early age, children often develop a hyper-sensitivity to justice. You might see them throw a temper tantrum over what they perceive to be "not fair." They also know what it means for someone to "get what they deserve." As we grow up and transition from the imaginary playground to our new bottom-line driven realities in the field or in the office, our language transitions as well, but the hardwiring remains. If we are not intentional, we risk missing the opportunity to become a part of an "Effective Organization" (or risk sounding childish). Our definition of accountability must mature along with us. Many people believe that accountability means to “punish” someone for failure. Punishment is only a minor part of the process and focusing on that minor part will limit your organization's exposure to the "grown up" benefits that result from a mature understanding of accountability.

So What is “Accountability” Anyway? It literally means “to account for ones actions” and therefore requires one to determine both “what” occurred (measurement) and “why” it occurred (cause). Effective organizational leaders know that the key to effective accountability is to understand “why” people do what they do and get the results that they get. Accordingly, they intentionally start the accountability process by determining “why” either success or failure occurred.

Effective organizational leaders understand that accountability is not an opportunity for “blame”, which is usually the result of someone committing the Fundamental Attribution Error, i.e., the tendency to attribute failure to personal characteristics such as motivation. They move beyond this type of error to evaluate the total context in which the person found themselves and therefore evaluate not only motivation, but also factors such as skill level, knowledge, peer and authority pressure, availability of resources or organizational systems such as policies and procedures. Only after a complete analysis has been done is causation determined and consequences delivered.

Positive & Negative Effective organizational leaders know that it is important to apply both positive and negative consequences as appropriate. They know that you strengthen desired behavior through the application of what psychologists call “reinforcement” and they use appropriate reinforcement for the level of success that has been observed. They also know that you weaken (reduce the chances of future reoccurrence) undesired behavior through the application of what psychologists refer to as “punishment” and they use appropriate punishment for the level of failure that has occurred.

"Do as I Say, Not as I Do?" Additionally, effective organizational leaders understand that they are being watched by organizational members to see if accountability is consistently applied across all organizational levels. Are they holding themselves accountable for their actions and results in the same manner that they are holding others accountable? Failure to show consistency in accountability (especially when punishment is called for) leads to a reduction in trust, morale and job satisfaction because it sends a mixed message to the organization. Leading by example helps to create trust, improved morale and job satisfaction and sets the stage for consistency throughout the organization.

What's the point?

Consistent, fair accountability, that is focused on fixing the causes of failure, is at the heart of organizational effectiveness.

Effective Organizations Model & Develop Facilitative-Relational Leadership throughout the Organization

In our 2012 Newsletter series, we took an in-depth look at the Top 20 Characteristics of a “Best Boss”. Our conclusion was that “Best Bosses” exemplify a leadership style that we call “Facilitative-Relational Leadership” (also referred to as “Transformational Leadership” by others [e.g., Bass, 1985; Burns, 1978; Zohar, 2002]). Facilitative-Relational Leaders focus on making it easier for employees to express their views and accomplish their objectives and they do so by manifesting the 20 characteristics that we have identified. Leaders of highly effective organizations understand that the type of leadership that they show and that they help develop throughout their organization can have a significant impact on results. Consequently, they work to personally model this style and simultaneously develop those skills in the larger management team throughout the organization.

So as a quick review, what are these characteristics?

  1. Excellent communicator
  2. Holds himself and others accountable for results
  3. Enables success
  4. Motivates others
  5. Cares about the success of others
  6. Honest and trustworthy
  7. Shows trust by delegating effectively
  8. Fair and consistent
  9. Competent and knowledgeable
  10. Rewards/recognizes success
  11. Leads by example
  12. Loyal to employees
  13. Friendly
  14. Good problem solver
  15. Team builder
  16. Flexible and willing to change when necessary
  17. Good planner/organizer
  18. Shows respect to others
  19. Good decision maker
  20. Deals effectively with conflict

By utilizing these skills, Facilitative-Relational Leaders attempt to develop a relationship with employees and other team members that creates an environment of safety, where others are willing to show initiative by speaking up and contributing to solutions. They attempt to consciously develop both the skills and the self-confidence of all employees. They evaluate decisions against the mission of the organization and are willing to change course if necessary.

Effective organizational leaders understand that Facilitative-Relational Leadership is almost always acquired as opposed to something you are born with, so they provide training and coaching opportunities for all managers to learn why this facilitative style is effective and how to use the skills successfully. They also give opportunities for managers/leaders to practice the skills with feedback so that they can effectively implement them in the workplace. Leaders of effective organizations also understand that people need feedback on both successes and failures, so they utilize both formal and informal opportunities to provide that feedback.

What's the point?

Facilitative-Relational Leadership is a package of characteristics and skills that, when utilized, significantly increase the success and effectiveness of organizations.

Effective Organizations Align, People, Systems, and Processes

For our 2013 Newsletter series, we have transitioned from a personal or micro-level focus, where we looked at what it means to be a "Best Boss", to an organizational or macro-level focus, where we will examine the characteristics of an "Effective Organization". In our first installment of the series we looked at how Effective Organizations: #1 - Clearly Define Mission, Values, Goals & Expectations.

The quest to build from scratch or transform your organization into one others would describe as "Effective" will prove costly if the process stops at quantifying, qualifying and communicating desired results. The essential next step is to ensure alignment of all the elements of the organization that will produce the desired results.

What is "Alignment"?

Alignment is simply ensuring that every aspect of the organization (people, teams, surroundings, and systems) works together to create desired results.

We have previously introduced the concept of “local rationality”; i.e., people make decisions to perform in various ways as a result of the local context in which they find themselves. This context includes factors such as Self (motivation, ability, knowledge, habits, attention, emotion), Others (help, pressure, modeling), Surroundings (equipment, climate, layout) and Systems (rules, rewards/punishments, procedures). The person’s view of that context will impact how they act, which will impact the results that they get. Effective organizational leaders understand this and work to create a context (sometimes called “culture”) that increases the chances that their employees will decide to perform in ways that lead to accomplishment of the organizational mission.

For example, when changing organizational policy on some issue like “incentive pay” (System), effective leaders will attempt to evaluate the impact of the policy on decision making at all organizational levels. If the policy provides incentive to produce at a higher rate, then it could lead to shortcuts in approved procedures and perhaps even create an incentive to cheat or perform in a less than safe manner. While increasing production, the policy would be “mis-aligned” with other desired results and thus become counter to overall organizational effectiveness.

Culture Alignment Diagnostics

We have had the opportunity to help leaders evaluate this type of alignment on several occasions. We call our process “Culture Alignment Diagnostics” and it involves three primary phases (Diagnosis, Design and Intervention).


If not already done, we have senior management articulate their desired “formal” organizational culture by defining the values and behaviors that they feel will support accomplishment of their mission. We then review Systems (policies and procedures) and Surroundings in light of their alignment with the desired culture. This is followed by interviewing a cross-section of employees at all organizational levels and segments to determine the real “informal” culture that exist. This information allows us to determine if “alignment” currently exists between people, systems and process. We then deliver a report to senior management with our findings and recommendations.


The results of the Diagnostic Phase will provide the information needed to guide the design of any necessary change. Few organizations have perfect alignment and therefore most require some changes to achieve alignment. Management determines what changes are needed and then they design a plan to make those changes.


Every organization is different and thus needs different “interventions” to bring about the desired culture. Some organizations need training programs to impact employee knowledge and ability. Some need accountability systems to ensure consistent adherence to the desired cultural values and behaviors. Some need to change reporting structure. Once the plan has been determined, it is implemented and the appropriate changes will hopefully lead to greater alignment and thus greater effectiveness.

What's the point?

Whether you use a process like the one just described or not, continuous evaluation of alignment between formal and informal cultures is needed to remain or become an effective organization. This is especially true if your organization is not getting the results that are expected.

Effective Organizations Clearly Define & Communicate Mission, Goals, Values & Expectations

Last month we shared the 11 topics that will make up our 2013 Newsletter Series - Characteristics of an Effective Organization. Top Down When we talk about effective organizations, we are really talking about organizational characteristics that have been created through the decisions and actions of upper management and then passed down through the organization to become part of the organization’s culture. So when we talk about clearly defining and communicating mission, goals, values and expectations we are talking about something that must come from the top.

Mission Let’s start with “mission”. An organization’s mission is its reason for existing, its purpose, where it is “headed”. People need to know the mission so that they can “get on board” and help with its accomplishment. The mission is usually defined and then communicated through a “mission statement” that has been thought out and clearly articulated by senior management.

For example, McDonald’s stated mission “is to be our customers’ favorite place and way to eat.” That is “why” they are in business. That is where they want to “go” so to speak. That is their direction.

Goals & Values This mission is pursued through the accomplishment of a set of clearly articulated goals and the application of a set of “values” that impact decision making. For example, McDonald’s states their values as centering “on an exceptional customer experience - People, Products, Place, Price and Promotion. We are committed to continuously improving our operations and enhancing our customers’ experience”. They have additionally articulated a set of seven specific values that further clarify their overall values statement and guide the accomplishment of their mission.

McDonald's Values

  • We place the customer experience at the core of all we do.
  • We are committed to our people.
  • We believe in the McDonald’s System.
  • We operate our business ethically.
  • We give back to our communities.
  • We grow our business profitably.
  • We strive continually to improve.

Formal & Informal Cultures The mission and values statement of an organization like McDonald’s is an attempt to articulate the desired “formal” culture of the organization, but only through clear articulation of expectations and followup on achievement of those expectations can an organization have an alignment of the informal culture with the desired formal culture of the organization. To read more, see our recent blog post "You Might Not Always Get What You Want."

Expectations Effective organizations and their leaders continuously evaluate movement toward the stated mission, in light of the stated goals and values, and then communicate their expectations of team and individual performance throughout the organization. As we will discuss in future newsletters, they also hold everyone accountable for meeting expectations and understand that clarity of expectations has a direct impact on a person’s ability to be successful.

What's the point?

In effective organizations, the mission, goals, values and expectations are not mere words on a plaque on the wall. Rather, they are a way of life, understood by every team member. They are the catalyst for moving the organization toward greatness.

11 Characteristics of An "Effective Organization"

Our 2012 Newsletter series focused on the Top 20 Characteristics of a “Best Boss” and we described in some detail how these individuals come to be seen in this light by their employees. This year, we will focus at a more macro-level and evaluate what it takes to be seen as an “Effective Organization”. Effective Defined “Effective” can be defined in many different ways, and an agreed upon definition has eluded organizational researchers for decades. In light of this, we will need to begin our discussion with a definition that, hopefully, we can all agree on to some extent. Simply put, an "Effective Organization" is one that meets its stated goals and accomplishes its stated mission. But of course, by this definition, low goals and unimportant missions can create effectiveness and this would miss the point.

We view "Effective Organizations" as those where the mission and goals are ones that people would want to invest in and/or participate in because they bring value to not only the individual, but also customers and society in general. They are viewed as “High Performance Organizations” because they are considered more successful than their competitors in areas such as profitability, customer service and strategy. In other words, they are effective at getting results that are seen as superior and valuable to others.

The Next 11 Issues Our discussion over the next 11 months will focus on some of the characteristics of these types of effective organizations, which by the way are found in both for profit and not for profit organizations. So what are the characteristics that we will be discussing this year? While this list is probably not complete, both our experience and the research of others supports each of these as a component of an effective organization.

The order of appearance of each characteristic is not reflective of our view of it’s importance; only that it is necessary for an organization to become really effective. So here are our topics for 2013.

An "Effective Organization":

#1 -- clearly defines and communicates mission/goals/values/expectations

#2 -- aligns all aspects of the organization including people, systems and processes

#3 -- models and develops Facilitative Leadership throughout the organization

#4 -- holds everyone accountable with both positive and negative consequences for results

#5 -- builds a collaborative and empowered environment based upon teamwork

#6 -- tolerates appropriate risk taking and learns from both success and failure in an attempt to be innovative

#7 -- focuses on meeting customer expectations and needs

#8 -- creates a culture based on honesty, integrity and mutual respect

#9 -- identifies meaningful measurements and timely feedback

#10 -- insists on open communication throughout the organization, and

#11 -- is resilient; capitalizes on adversity.

As we discuss the characteristics of effective organizations, we would challenge you to evaluate your organization in light of these characteristics, just as many of you did for your own personal leadership performance in 2012.

Hopefully, our discussion will help you move your organization and/or team toward increased effectiveness, no matter where you are at present.