Why strategy fails: Only 9% of leaders trust each other

Belichick and Brady of the Patriots wouldn’t have won Superbowl 51 if the rest of the team wasn’t onboard with the plays.

Can you imagine if each player had their own plan? Chaos would ensue.

In sports, just like in business, each player must agree on the winning strategy.

What does my boss want?

Fortunately, most organizations do well on vertical alignment. That is, most people concur with their manager’s priorities.

Donald Sull from MIT Sloan reports in his research that “84% of managers say they can rely on their boss and their direct reports all or most of the time.”

Studies outside of business strategy report similar obedience to authority. In a famous experiment by Stanley Milgram, it was found that people will comply with commands from authority even if they disagree in principle.

Why should we help each other?

Unfortunately, horizontal alignment is a challenge. We don’t always see eye-to-eye with peers from other teams.

In the same research, Sull reports how:

“Only 9% of managers say they can rely on colleagues in other functions and units all the time, and just half say they can rely on them most of the time. Commitments from these colleagues are typically not much more reliable than promises made by external partners, such as distributors and suppliers.

When asked to identify the single greatest challenge to executing their company’s strategy, 30% cite failure to coordinate across units… Managers also say they are three times more likely to miss performance commitments because of insufficient support from other units than because of their own teams’ failure to deliver.”

If we think about it for a second, most companies’ organization structure don’t actually incentivize horizontal alignment.

By grouping people by function, leaders from different departments are bound to have different priorities. They see problems from different angles. So when time comes to prioritize initiatives, they will obviously vouch for what is most important to their team.

For example, sales teams may prioritize the need to meet this quarter’s quota by adamantly selling a newly launched product, whereas engineering and manufacturing teams may prioritize quality control and limit how many new models to produce. This type of conflict pit one team against another.

The result is a sluggish organization. Research by the Economist Intelligence Unit reveals that the…

“…main obstacles to improved business responsiveness are slow decision-making, [fueled by] conflicting departmental goals and priorities, risk-averse cultures and silo-based information.”

This is a major disadvantage in our chaotic business environment.

We must work together to survive

To further explore the problem of horizontal alignment, let’s explore the concept of system thinking with Prof. Russel L. Ackoff, a leader in the field. Here’s a portion of his talk in a Ted style video:

“A System as a whole consists of parts, each of which can affect its behavior or properties… Each part of the system when it affects the system is dependent for its effect on some other part… No part of the system or collection of parts in a system has an independent effect on it… A system as a whole cannot be divided into independent parts… The essential property of defining property of any system is the property of a whole that none of its parts has.

For example… The essential property of an automobile is that it can carry you from one place to another. No part of an automobile can do that. The wheel can’t; the axel can’t; the motor can’t… but the automobile can.”

Ackoff used the analogy to describe an organization, which is in essence a system formed of many parts: Teams. Together, a firm can add value to raw inputs and sell them at a profit. But none of the individual teams can do that alone. The marketing team can’t do that alone, nor can the engineering team.

Teams must work together to win.

How parts interact with each other in a system is therefore critical to the functionality and effectiveness of the system. Prof. Ackoff describes in an example how assembling a car using the best engine in the world, the best transmission in the world, so forth and so on, will not produce a working automobile. Because “the parts don’t fit.

Empathy is key

From a system design perspective, there’s a BIG difference between a car and an organization: The transmission we choose to install in a car doesn’t have a mind of its own. Managers do. Teams do.

Leaders must therefore agree on what problems represent priorities for the organization before they can agree on a strategy.

It’s been found that the less we empathize with other teams, the less we are able to agree with them. Susan L. Kline, professor of communication at Ohio State University, reveals in her research:

“Highly differentiated refusers do not necessarily compromise or empathize with the other; rather they provide compelling descriptions of the refuser’s position and explicit inducements for the other to agree… More differentiated individuals engage in “message-fitting” practices that especially entice the hearer to believe in the conveyed message.”

When it comes to business leaders, the need to protect their teams’ well-being often contributes to unempathetic behavior. A strategy researcher from Harvard Business School shared in an interview that strategic disagreements tend to arise when 

…people get defensive. They argue for a point of view that favors them instead of the entire organization. They could object or agree depending on how a decision affects them specifically. Whether it will help their part of the organization.”

Why do leaders get defensive? As with any changes in life, leaders can perceive strategic changes as threats. In turn, they engage in defensive and close-minded behavior, obstructing their ability to empathize.

When asked how to cope with that problem, the Harvard strategist described the need for leaders… 

“…to enforce what’s best for organization. Try to be open minded and play as a single team, rather than independent teams.

Next time we debate strategy, let’s remind everyone we’re on the same team.

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