Adverse Trends in Business

Adverse Trends in Business

In today’s business environment, companies expect to contend with traditional business challenges such as technical operating issues, competitive markets and financial imperatives. In addition, there are newer developing challenges such as; changing regulatory requirements and increasing expectations with respect to the environment and social license.

However as companies seek to respond to these internal and external pressures we see distinct trends in both how companies attempt to respond to these challenges as well as trends in how companies often fail to respond well or spend too much to address their challenges. Some of the more significant adverse trends we see in business today include:

1. Companies that make large financial investments in business systems, programs and tools, including large training programs, that don’t quite deliver as promised.
2. Businesses that suffer specific areas of chronic underperformance, which could be anything from safety, cost control, production efficiency or revenue generation, which seem to resist improvement attempts, many of which involve training.
3. New business processes or initiatives that seem to have trouble becoming the new normal way of doing business.
4. Middle management who seem to align with their employees more than they represent the company.
5. Front line employees who appear to be disconnected from leadership or don’t buy-in to leadership’s vision.
6. Employees who go through the motions and seem to view some of their accountabilities as an imposed “burden”.

While this list may apply to variety of challenges, we would suggest that in fact the issues that cause these problems are relatively straightforward, related to each other, and amenable to mitigation at a much lower cost than is often anticipated.

Big Systems That Underperform

The common view is that to be competitive in the business world today, companies must leverage technology and embrace technological tools such as: Enterprise Resource Planning (ERP), Asset Management systems or Centralized Maintenance Management Systems (CMMS), Health and Safety systems, and Enterprise Performance Metrics (EPM).

While there are a number of highly qualified vendors for these and other tools active in the marketplace, we would suggest that in a disturbing number of implementations the level at which these systems are actually used represents a small fraction of the systems capability. When we think about the way most people use spreadsheet software such as Microsoft Excel, this tendency to underutilize is easy to relate to. However when an organization has invested tens of millions, if not hundreds of millions of dollars in IT systems, it seems illogical to not fully leverage them.

In our view this underutilization of systems tends to be more of an implementation problem than a problem with the tools themselves. It has to do with the belief that:

Just by turning a system on, people will use it and value will be created.

If the systems in designed to be “tight” and “rigorous” people won’t find ways to circumvent it.

That all the value people see in person-to-person contact and relationships can be replaced by selecting a data point in a drop down menu.

That people will remember and be able to apply the training they were immersed in ahead of the system go-live date.

The system eliminates the need for competence and performance on the part of employees.

That the system eliminates the need for leadership to lead.

While all of these statements are patently false, we see organizations fall into the trap of hoping they will come true. When newly implemented systems fail to perform as anticipated, the reaction is often to seek someone to blame, whether that is the service provider, the internal sponsor or the users.

Our advice to organization would be to identify the specific implementation error that was made, seek to address it and move forward to improve the performance of the system and the business. The worst option would be to drop the new system and try and buy a better tool.

Just Do More Training

When many organizations find internal problems; whether they are anecdotal evidence of a cultural problem poor results in a functional area or a desire to change how the business operates; the first response is often to suggest, “let’s do some training”. Often someone in HR is tasked to find an organization with training materials, a series of training sessions is organized for the target audience, attendance at the training sessions is tracked and then months after the training program is completed, very little has really changed.

We would suggest that training is a powerful tool. Training is essential as an enabler for change and performance improvement. However we see two problematic training trends in business today, which are: Trying to use training to solve an unrelated problem, and even where training may be appropriate, the way tra