Chopping Trees vs. Sowing Seeds | Part 1 – Chopping Trees

Are we selling the future to survive today?

You’d be hard pushed to find anyone who’d disagree that times are both tough and uncertain at the moment.

Organisations are focusing primarily on cost cutting, spending less and less on growth and development, reducing recruitment. This is hitting both direct suppliers and service providers hard, causing them to go out of business or shed jobs. People, concerned about their job security, are naturally spending less – which in turn creates more unemployment and cost cutting.

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It’s a vicious circle.

But are the major job and spending cuts the right thing to do? I can’t help wondering whether people in businesses are behaving in a way that is making a bad situation worse; whether we are inadvertently ‘doing it to ourselves’.

Personally, I think this is the case. Rather than investing in getting smarter and thus better, many companies appear to be dramatically reducing their horizon and focusing purely on appeasing analysts and the next quarter’s results, rather than long term planning for the future. They are almost paralysed by fear at the moment, resulting in any planned expenditure being strenuously challenged, so no one dares to take any risks with their budgets for fear of failure or being viewed as corporately irresponsible. They are selling out tomorrow in order to survive today.

It’s all in the mindset...

In NLP speak, this suggests that many businesses are taking an ‘Away-from’ approach, focusing on moving as far away from any risk and potential pain, and not a ‘Towards’ mindset where they have a more positive view of the future and focus on moving towards growth and innovation. These companies appear to be focusing primarily on reacting to things they cannot affect (the economy, Euro crisis, recession) and not focusing on controlling things they can affect (innovation, product development, improvement, effectiveness).

One for the most damaging behaviours I have noted is the willingness to accept mediocre performance, financial loss, waste and poor behaviours and processes – as long as these suboptimal activities are without a direct owner and blame cannot be attributed. Conversely, the availability of leadership courage needed to raise heads above the parapet and invest budget in improvement initiatives also seems to have dissolved. In this mindset, protecting the status quo = survival.

Does the last man standing on a sinking ship win?

In a recent example, a large manufacturing company has decided that the way it does business currently is ‘optimal’ despite the fact that it’s service levels are sub-standard, premium customers won’t buy from them and it is closing some of its manufacturing capability resulting in large scale job losses. Their alternative would be to invest in improving; in ‘being better’. However this requires innovation and learning from outside the organisation – which conflicts with the business’s fixed mindset and belief of itself as superior despite all facts to the contrary.

Another example I’ve come across recently involves a large multi-national organisation that is set to waste hundreds of millions of euros on an ERP implementation that will not deliver on its promise – due to a recognised lack of focus on the business, and too much focus on the technical and IT implementation aspects. Whilst some in the organisation recognise the signs, the fact is that this project was started and signed off some time ago, and rather than ‘confront the brutal facts’ and spend 0.1% of this potentially wasted investment on ensuring the project succeeded, they would rather continue as is. I struggled to comprehend why a business wouldn’t invest 0.1% to save 99.9%, until I realised that spending the 0.1% required two things;

1. Someone to authorise the additional budget (which no one was brave enough to do)
2. Courage to acknowledge that issues with their project existed and take action

Their lack of courage and ‘fixed’ mindset prevents them taking proactive action that would I’m sure ensure success. The end result will be, I’m sure, disappointing, and followed by job losses as the business seeks to recoup money by cutting costs.

So what to do?

In my next post I look Stateside to the lessons learned from Steve Jobs tenure as the man who turned Apple from a near bankrupt organisation to the world’s most valuable one – and how these lessons should be applied by organisations in order to thrive in these turbulent times.