If one were to ask Lou Gerstner when he was the CEO IBM why IBM lost 75% of its value in the early 90’s, one could surmise his answer from a review of articles in which he discusses the issues. What Mr. Gerstner would NOT tell you is that IBM did not have the talents, the skills, the technology, the knowledge, the capital or the markets. No, what Mr. Gerstner might well tell you is that it was HOW the management teams were NOT functioning that was essentially the problem. Figure 1 might graphically depict the situation: members of the management team appear to be operating more like individual “one-man-shows“, rather than as a true team with all resources aligned.
In a Business Week article, Jeffrey Garten, Dean of the Yale School of Management, points out that the typical leadership behavior of cutting costs and meeting quarterly goals is insufficient to ensure long term viability. CEO’s, he points out, must bet on their vision to compete with the “smaller, hungrier companies.” Andy Grove, former Chairman at Intel, believed will continue emerge to reshape their industries.
As organizations shift from the initiatives of the early 90’s of quality, re-engineering and downsizing to growth strategies in order to boost shareholder value and address the growing competitive threats (Wall Street Journal), there is an increasing focus on the leadership provided by the management team in guiding these new growth strategies. A cursory survey of business publishers including Harvard Press and others reveals what appears to be a rise in the number of books being published on the subject of management teams, their roles and effectiveness. HOW the management team functions – its effectiveness – is becoming more critical than ever in developing and executing these new growth strategies.
In our work with management teams, we have discovered that while it is apparent to all that the common underlying element that impacts both positively and negatively the success of the initiatives of the organization is the effectiveness of the management team, we continue to be surprised by the extent of “dysfunctional“ behaviors we encounter. In fact, much has been written about what some view as an oxymoron in using the term “management team“. While the organization chart may look like a team, the theory of teamwork is often not connected to the reality of daily activities of the management team.
In the following posts we will describe how, in working with organizations to plan, implement and manage change, Avantt Consulting has addressed the issue of aligning management team effectiveness more closely with the vision and strategy of the organization. The issue is not that our client management teams are ineffective – the organizations we work with tend to be very successful – but rather, how to better capitalize on the growth initiatives of the organization.