Tag Archives: Employee Engagement

Dynamic Balance and HR Strategy – Should they be linked?

We constantly talk about the dynamic changes in the business environment and how we need to adapt in order to survive, but how much do we look into the dynamics of our own organizations to make sure we achieve a balance that will allow us to thrive?

I we take Fritjof Capra‘s definition of dynamic balance, we find a different way of looking at our organization which can help us in better defining our HR Strategy.

 “An ecosystem is a flexible, responsive, ever-fluctuating network. Its flexibility is a consequence of multiple dynamic sense-and-respond feedback loops that keep the system in a state of dynamic balance. No single variable is maximized: all variables fluctuate in concert around a collective optimum.”

Lets clarify this definition by looking at how Giles Hutchins talks about feedback loops in his book “The Nature of Business“:

“Nature is interconnected and interdependent, with every part of the ecosystem functioning as part of myriad seamless endless cycles. These beautifully coordinated cycles of nutrients, energy, water, materials and information are possible because of the feedback loops. Feedback loops are nature’s way of ‘staying in sync’ with ever-changing conditions.”

So the question is, do we really pay attention to the messages the organization is providing? Do we create an environment where there is a constant flow of feedback that enables the organization to continuously adapt to the constant change?

I fear the answer is no. One of the most important components of the definitions above is that every single part of an ecosystem is important. What I tend to see in organizations is that when there are conditions changing in the market, it is mostly upper management and the marketing and sometimes strategy specialists who define what the company will do in order to weather the storm. What we tend to forget is that there might be other things we can do to adapt that we don’t know of because we are not listening to the organization.

I have had the fortune (and also the stress) of living and working in Argentina during the hyperinflation. When I say hyperinflation I mean it: 4,923% inflation in 1989 followed by 1,343% in 1990! It is difficult to convey the type of environment this creates. You need to make decisions and make them fast. You need to decide if you are going to sell your products or not because between when you send them to the customer and when you receive their payment the money you receive is not enough to pay for the costs of producing it. In essence, you need to figure out how to survive.

I was working at a B2B company at the time and witnessed one of the best examples of how to listen and use the feedback to make it through the difficult times and be prepared for when things got better. We could not send the sales force out to get orders so, what could we do? They came up with impressive ideas of how to build customer loyalty by helping them find ways to move through this crisis and survive themselves. Sometimes it was simply helping them figure out a solution to a problem that normally would require a big investment but that with a little ingenuity could be resolved with much simpler means. It had nothing to do with our specific business, we were only helping out by listening and providing ideas.

Sharing Open Ideas

By Opensourceway

What we were able to do with this approach of listening to employee ideas, keeping them informed of how things were evolving, involving all in thinking how we could reduce expenses so we could keep everyone employed, how to help our customers while we could not even provide them with our products, was to have extremely committed employees and customers. As soon as things started to improve a little and we were able to see the light at the end of the tunnel, we started selling at levels that were significantly higher than before the crisis. We became the number one provider for our products and services in the market.

What would have happened if we had not listened? I don’t know if I would be where I am today, because I don’t know if the company would have survived and maybe my career would have taken me to other shores.

My point is, if we want to maintain a dynamic balance that allows us to thrive despite difficult or normal ever changing conditions, we need to ensure that we have open communication channels that allow us to benefit from the knowledge and ideas of employees at all levels. Maybe looking deeply at some of the examples of companies that have failed can provide us with insight as to how much the employees knew about the mistakes their upper management was making and that they felt they had no power to influence or make their voices heard.

We don’t need to take this to the extreme. If we fail to listen and take advantage of the knowledge of our employees, we might still succeed but we will probably not achieve as much. Our role, when defining our HR Strategy, is to make sure we understand the dynamics of our organization and enable the feedback loops that will take advantage of our employee’s insights and ultimately achieve dynamic balance.

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Human Resources, How can we add value?

HR is frequently viewed as a function that is needed but in very few occasions are we considered as really adding value to the organization. By looking at the organization from the perspective of nature, can we become a motor for change to help it prepare for the future? Can we use this to demonstrate the value we bring?

It is unfortunately true that HR is viewed as a necessary evil in many organizations. It is also true that many times, as HR professionals, we fail in being able to articulate how we can deliver value and impact the bottom line. We are viewed, and in many cases we consider ourselves, as a function that is there to make sure there is adherence to laws and regulations and to hire or fire people when needed. We are frequently considered overhead or even a burden.

One way we can change this perception is by driving change and helping the organization prepare for future challenges. We need to understand first what changes the organization will face and the only way to do this is by knowing the business intimately and understanding the strategic direction the organization is seeking. But this is not enough.

Lets look at the organization from a different perspective. Giles Hutchins in his book “The Nature of Business” shares the view that if we look at nature to understand its patterns it might

“provide insight into how best to future-proof business for the unpredictability ahead”.

Wouldn’t it be wonderful if we could use this understanding of nature and apply it to the organizations we work in and show how we can add value by developing our HR programs and strategies in accordance to these principles?

What Hutchins proposes is for us to look at the organization based on the Principles of Nature he quotes from Fritjof Capra‘s book “The Hidden Connections:  A Science for Sustainable Living“. These principles are:

  • Networks 
  • Cycles
  • Solar Energy
  • Partnership
  • Diversity
  • Dynamic Balance

Lets look at each one of these principles from the perspective of understanding an organization. We know there are networks of relationships and many times we refer to them as the formal and informal relationships that occur within the organization. But what about really understanding where the “boundaries of identity and interaction” are? A thorough understanding of these networks will enable us to develop more effective ways to communicate within the organization as well as determining where there are barriers to collaboration.

Cycles are also present within organizations. If we take the time to look at the past and correlate the ups and downs, the expansions and contractions, with the impact on employee morale, retention or loss of talent, etc. we can anticipate what the impact can be if we know we are headed in a certain direction. We can learn from the way the organization moves through these cycles and then decide how we can support it to avoid past pitfalls.

Solar energy is a little more tricky, although if we draw a parallel between how it is the fuel that allows life of all living organisms, we can say that employee engagement is the fuel that enables companies to succeed. It is proven that increased levels of engagement have a considerable impact on the bottom line and we need to make sure we focus on this if we want to add value.

Partnership is the principle of cooperation. Is this a way of life within our organization or do we work in silos, worried about the results of our individual objectives? Are the programs and systems we have in place for measuring performance, establishing goals, etc. fostering collaboration and cooperation? We need to understand the impact of the programs we put in place so that we can re-design them to enable an environment that is conducive to cooperation.

Diverse Network

by Jurgen Appelo

Nature clearly shows us that the greater the biodiversity the more resilient the ecosystems are. The same is true within organizations. When we talk about diversity we sometimes fail to grasp the true meaning. We need to foster an organization that is diverse, not only in race or origin, but diversity of thought. Do we let managers hire people that are like them, because they are easier to understand, or do we promote positive change by creating an environment where different is great?

Finally we have dynamic balance. Nature shows us that “no single variable is maximized, all variables fluctuate in concert around a collective optimum”. Do we really take the time to understand each piece of the network, each part of the organization? Do we take them all into account when we are thinking of our HR strategy? We normally focus only on the things that are deemed the most important (our high potential employees, our executives and leaders) and we forget that, if we truly want to drive results we need to maintain the dynamic balance that allows everyone to flourish.

So we need to devote time to understand our organization and what the reality is based on the principles of nature. That will enable us to drive positive change as it will provide an intimate knowledge of the key areas we need to focus on. By driving change from the perspective of the organization as a living organism we will prepare it for the future that lies ahead and the value HR brings will be clear.

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Why is Employee Engagement and Accountability Dying?

Employee engagement seems to be in decline and along with it employees do not want to be accountable for what goes on in the companies they work in. Is this influenced by size? If so, are there HR strategies we can use to drive change?

Is there a correlation between employee engagement levels and the willingness to accept accountability for what goes on in the company? If this is so, then the engagement levels are declining drastically. Reality is that I rarely hear anyone refer to the company they work for as “we”. It never is “we” do this or “we” decided that …  it always is “they” offer, “they” did, “they” want.

This becomes especially intriguing when you are talking with a senior level executive. It is very rare that s/he will say “we” decided to do this or “we” have a policy that defines that this is how “we” handle this type of situations. Normally the statements will be more like “they” or “the board” or “the leadership team” decided … as if it were an intangible entity. What do you mean “they”?  You are an executive of the company, shouldn’t it be “we”?

This phenomenon is becoming the norm. Why do people want to distance themselves from the company? I personally think that it has to do with not wanting to be accountable for what happens. No one wants to be the one to blame. And this is probably the result of an environment in which employees do not feel included, they do not belong to a community with a shared objective and therefore there is no need to feel accountable for what goes on.

Now, if a company is made of the people that work for it, and no one seems to want to take responsibility for what is done, what is the outcome? I can think of countless examples of news events that showcase this lack of accountability. There is no need to mention them here.

 Wordle: My HR Post Blog 1

There are exceptions though and it tends to be in smaller companies, where leaders and employees work together to make things happen. This type of environment seems to be conducive to innovation, risk taking and consequently pride. Remember “Small is Beautiful” by E. F. Schumacher? Although it was written in 1973 we should all read it again. The full title is revealing: “Small is Beautiful: Economics as if People Mattered”.  Schumacher warned against the trend of mergers and takeovers creating ever-larger organizations. He stated that while economists supported this trend, sociologists and psychologists warned against the “dangers to the integrity of the individual when he feels as nothing more than a small cog in a vast machine and when the human relationships of his daily working life become increasingly dehumanized; dangers also to efficiency and productivity, stemming from ever-growing Parkinsonian bureaucracies.”

Is this the key? Do companies forget that people truly matter? Do executives have such a narrow view of things that they forget to consider their companies as the living organisms they are? Is this why employees are not engaged? Is this why no one wants to be accountable?

If the problem is due in part to an order of magnitude, is there a way large corporations can create an environment where they can work so as to benefit from the interactions that happen in smaller organizations? This is an interesting question. Most large corporations spend copious amounts of money and time developing their leaders. They state that managers should lead their employees by creating an environment of trust, where innovation in encouraged, where employees are empowered to make decisions, etc. etc. etc. but my impression is that they fail in providing the managers the latitude and freedom to be able to make things happen. Or is it that they are providing tools that are so cutting edge that only few are able to benefit from them? Would it not be better to use what Schumacher called “intermediate or appropriate technologies” in order to breach the gaps?

Now, don’t get me wrong. I am not saying that all small companies have engaged employees or that they all have great business and leadership models that make employees feel empowered and proud of what they do. Far from it. It seems that there are very few examples of organizations that are successful in really engaging all employees to a level that they all are proud of working for “our” company.

Giles Hutchins in his book “The Nature of Business“, states that organizations of all sizes and types will need to redesign in order to become resilient and face the challenges the next decades will pose. He also talks about how the companies that mimic nature outperform the ones that maintain the approach taught at business schools. Should business schools focus more on the decentralized development models proposed by Schumacher? Might that be the type of approach that can help organizations transform and become more successful, not only in profits but, more importantly in their social responsibilities?

My intention is to analyze in future blogs what Human Resources professionals can do to help transform their organizations. I will explore Schumacher and Hutchins’ theories and see how we can utilize them to strategically drive positive change.

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