Monday, September 27, 2010

We Need a Rule For This!

You've probably heard this saying: "Don't use a shotgun for a problem that could be solved with a rifle." If you haven't, you probably don't live in an area where a lot of hunting happens. Applying it to business, it means that we should solve problems with the appropriate means and measure. If it's a small problem (like a few individuals), deal with the small problem. Don't create a general rule that affects everyone when everyone is not a problem.

One of my axioms is "poor systems create more systems." Poor, uncontrolled manufacturing processes generate inspection systems. Quality "escapes" generate customer return processes. Take any business process and when there's a problem, most companies put more rules, procedures, systems on top of it to control it.

Many businesses will start with a handbook that define the basic rules and policies. When someone behaves in an undesirable manner, a new rule is created. Another situation arises that isn't quite covered by the current set of rules, and so a rule is modified or newly written.

A company can never create enough rules to cover every situation. This is why the corporate culture is important. The values and expectations need to be clear. Also, everyone should be accepting them. A few mavericks won't accept the culture, because they're not a good fit with the organization. Mavericks don't last long. I know; I've been one. I've been in corporate cultures where the values didn't fit my preferred modus operandi. I demanded respect, honor, dignity for everyone, and applying common sense and wisdom to the decisions. The company wanted to maintain a class system or a tradition.

A few years ago, I was consulting. We were traveling a lot. For several months, we were assigned to a company in the middle of the country. Our team rented apartments to reduce hotel expenditures. Some of us used the apartment complexes laundry facilities, instead of the usual practice of having a dry cleaner take care of our clothes. Coin-operated machines don't provide receipts. Our charges on the expense reports were denied, the rule being: no receipts, no reimbursement. Instead of reimbursing two dollars, someone in the home office spent eight dollars per person to send out a FedEx letter to each of us, reminding us of the rule: no receipts, no reimbursement.

The rule had nothing to do with controlling expenses, or making sure we were managing expenses to reduce costs for the client. The rule only had the basis to control possible abuse by a few dishonest people. Instead of common sense, expenses increased by continued use of dry cleaners.

What was sad about situations like this is that a new policy to control mavericks confuses everyone else. The new rule doesn't apply to them. In many cases, they don't know what problem the rule is trying to solve. They weren't even aware of what one or two people were doing. When they find out, they wonder why the company didn't continue to allow the behavior that they think is good. They too might have been mavericks.

Culture is hard to establish, hard to manage, hard to enforce. However, the cost of compliance to a set of ever-burgeoning rules is high. The cost of abuse in a culture is generally pretty low. There usually are a few individuals who won't go along. You don't need to "shotgun" the problem. Talk to them individually and find out what's going on. Create a corrective action plan for them if need be. Or figure out that perhaps they have good ideas and you want to let them go ahead. Maybe you want to others to mimic their behavior.

No comments:

Post a Comment