Company Revival—Employee Empowerment without Disruption and Alienation by Roy Richards

Company Revival—Employee Empowerment without Disruption and Alienation

By: Roy Richards

www.middleagerenewaltraining.com

In business enterprises large and small, those at the top continually tread a fine line between empowerment and control. While actively promoting employee initiative and the testing of new ideas, every CEO must hold incumbents firmly accountable for accomplishment of shared business objectives.

In an ideal scenario, every company employee would be granted an essential franchise and would strive voluntarily to optimize both individual performance and collective outcome. Every employee would relish his or her personal challenge and would search within for inspiration. The end result would be a harmonious collection of self-motivated high-achievers orchestrating in concert to produce winning results.

Can a lagging corporation or small business be revived in 2008 by empowering front line employees? Roy Richards, recognized authority on mid-life renewal for individuals and businesses, argues that stagnant enterprises can indeed be revived through employee empowerment but only if leaders first acknowledge then address the pitfalls of incumbent alienation.

The concept of pure corporate democracy remains a myth but a number of trend-setting companies have been able to flatten the organization pyramid and judiciously distribute decision rights to front-line employees. In fact, tightly wound, authoritarian top-down hierarchies and artificial, inflexible workplace class distinctions are rapidly losing favor.

More and more, today´s business pace-setters, young and old, clamor for access to the "big picture." Few remain willing to accept "on faith alone" dictates from above. Given access to real-time operating data and competitive intelligence, self-assured, upwardly-mobile self-starters are demanding increased latitude to demonstrate personal initiative. To keep their enterprises fine-tuned and on the cutting edge, in-touch leaders are coming to recognize that they have no choice but to broaden the franchise of qualified front-line contributors.

An appropriate model for employee empowerment might be the highly efficient bee hive. In a hive-like environment, enlightened "worker bee" employees perform complex coordinated tasks while receiving minimal intervention from above. Managers at all levels willingly divorce themselves from day-to-day micro-management and concentrate instead upon establishing priorities, enforcing ethical standards, motivating subordinates and monitoring individual and collective performance. Managers and executives willingly disperse decision rights but not without ensuring that every subordinate granted authority willingly accepts the added responsibility and agrees to comply with unbending company-wide rules of conduct.

Without question, any transition to shared decision making and authentic employee empowerment must begin at the very top. The CEO first must be willing to delegate significant authority to next-tier executives, who in turn must agree to assign decision rights to subordinates reporting to them. Like a fresh spring of water running down hill, empowerment soon spreads throughout the company cultivating a renewed spirit of pride, self-awareness and innovation.

A worthy empowerment objective is leadership through personal example and inspiration, blurring the artificial lines drawn upon an organization chart. In the flexible, borderless enterprise of tomorrow, project leadership responsibilities will tend to shift continually. Decision making will be shared by a broad spectrum of competent professionals, rotating based upon the precise nature of a then-current challenge.

Unfortunately, employee empowerment in practice is not as easy as the model implies. In empowering rank-and-file employees, enterprise leaders are confronted by three perplexing downside realities:

Every decision right transferred to a front-line employee must be taken away from his or her boss. Loss of power hurts.

Any restructuring which flattens the management hierarchy will displace one or more highly competent managers or executives. To retain these leaders, we will need to offer authentic replacement challenges.

Elimination of engrained management prerogatives will require fair cash compensation and/or substitution of alternative forms of non-monetary recognition and reward.

In an ideal dispersal, executives and managers at all levels below the CEO would be delegated additional decision rights from above. To avoid overload, these leaders, in turn, would willingly delegate prior decision rights to those reporting to them. In theory, only the CEO would experience a net loss of day-to-day decision making responsibility and would willingly do so. The CEO would continue to establish overall direction and would retain the ultimate authority for hiring, firing and promoting. Every qualified contributor below the CEO would inherit new responsibilities, thereby gaining empowerment.

In reality, dispersal of authority is far more complex. Optimal reallocation often dictates significant restructuring or transfer of decision rights. In extreme cases, entire offices, functional departments or management layers may be eliminated. No matter how difficult the sale, those at the top must convince displaced managers and employees that they will receive meaningful new franchise with an opportunity to prosper over time.

Compressing layers of management creates an inevitable dilemma: how do we retain and recycle displaced managers? A logical interim solution is to invite displaced managers to help define their new roles within the company. A number of your brightest and most self-assured displaced incumbents will immediately recognize the upside potential of a streamlined, fluid organization and will need no persuasion to remain on board, even with a temporary reduction in status or authority. High achievers never lose confidence in their potential to excel and relish any realistic opportunity to explore new horizons. As a corollary, those at the top must be prepared to move less-talented managers aside to make room for displaced winners.

As decision rights are dispersed and decision making becomes more democratic, the traditional "management" versus "employee" distinction will become a soon-forgotten relic of the past. Your goal is to give every employee an emotional stake in the "ownership" of collective results. Today´s pace-setting corporations like Microsoft and Southwest Airlines excel without complex, multi-layered management hierarchies and absent many of the traditional trappings of executive privilege.

A potentially destructive conflict occurs whenever top-tier executives attempt without warning to inject an egalitarian culture into a tightly-structured hierarchical organization. The blow may be softened by offering displaced managers two solemn promises:

"We promise never to ask you to sacrifice a current prerogative without offering offsetting compensation. We will ´buy out´ any privilege relinquished through a one-time cash payment or similar compensation to make you whole."

"Future excellence will be rewarded with generous cash bonuses, stock options and/or cafeteria benefit choices which permit outstanding performers to choose their own prerogatives. Moving forward, rewards can be earned by any extraordinary contributor."

As a substitute for lost management perks, an employer might offer current and future managers higher base compensation plus a more lucrative bonus incentive plan. Would not most incumbent managers choose $20,000 more each year in hard cash or stock options over a company lease car or the daily privilege of eating lunch in the soon-to-be-closed executive dining room?

In a newly perk-free enterprise, former privileges like belonging to a country club will be granted based solely upon functional necessity. Country club membership will be considered essential for executives and employees who routinely entertain clients and customers. Thus the Vice President of Marketing and certain senior sales associates undoubtedly would retain their memberships but the Corporate Controller probably would not.

The painful truth is that most human beings inherently resist change. Every one of us has a natural tendency to fear the unknown. Even when dissatisfied with present circumstances, we oddly prefer doing things the same old way. At the first sign of change, our natural tendency is to tense up and utter one or more of the age-old refrains: "What´s going to happen to me?" "Will I be able to adapt?" "Will I be better or worse off than I am today?"

To facilitate revival through empowerment, we first must demonstrate unwavering self-confidence in our ability to bring about change. Second, we must present a bold leadership vision of a positive collective outcome. Third, we must convince colleagues, subordinates and business partners that over the long haul the changes proposed can be positive for them. Our leadership call to action needs to be crystal clear to all: "For anyone willing to step up and accept the challenge, our enterprise today and tomorrow is an ideal place to be!"

The author of this article, Roy Richards, recently published a book, Wake Up Captain and Crew Restart Your Engines!, which provides a comprehensive blueprint for company recovery and revival. To preview his book, contact Roy or to inquire on his availability to speak at an upcoming event, please visit our website:

www.middleagerenewaltraining.com