Managing for consistency

One of the reasons for the well-known life-cycle of businesses – indeed of all institutions – is the paradox of good management. As soon as you’ve got it, it starts to become a burden. From Olympus to GE, from the British Welfare State to privatised railways, a bonus becomes an onus. In a marriage it is called give and take. It seems that the one thing we cannot establish in this world is perfect equilibrium. Like it or not, action produces reaction.

It is why forecasting is so difficult. It is why every challenge is a good reason to produce a response. It is why the only answer to complacency is upheaval. Should we then stop trying to make things run smoothly and precipitate crises from time to time just to ensure that we are kept on our toes? The banks have learned that to keep a client in a single staff relationship for too long can be a precursor to trouble. Familiarity breeds collusion. At the same time, old managements grow older – even at Goldman Sachs.

One of the benefits of a rapid technological revolution is that it makes us think beyond the scope of our day to day work, forces us to apply creative solutions to resources we never thought we would have. In the 1950s I produced the theory of the Strap-On Helicopter. “No good asking questions about it,” I said, “since no one will know what it is”. Now we have it. Would an imaginative approach to the impossible have prepared us better for the daily inventions we now face? In some sectors of society, Silicon Valley to name but one, it already does. The Pentagon employs writers and artists to plan for the future.

Change for the sake of change is surely not good. The years of diversification brought many businesses to their knees. While lack of perception ruined Kodak, a bit too wide diversity had the same effect on companies like The Rank Organisation. Focus is good but so is growth of knowledge, adaptability to opportunity and a true understanding of assets. We lack this last.

If there were a solution to these issues it would have been disclosed a long time ago. I air them because there is no solution. That should not stop us from seeking one. In your own business how do you refresh without ruining? I suggest five broad rules that will help:

Ensure that your CEO is Creative not Accounting, even if you are one of the Big Four Accounting firms. There will always be accountants to steady a too-enthusiastic developer and they certainly must have a big say. Not the top say. I saw, at first hand, a good, entrepreneurial business ruined by being handed over to an accountant.

For every new development ask “Do I have enough knowledge to ask the right questions of those managing the business?” No good being in the movie business if you don’t know the jargon.

Reward good development suggestions even when you don’t adopt them. To have your employees think they are part of the business they must feel their ideas are appreciated.

Employ socials not meetings to elicit the way forward. Meetings produce minutes; socials produce stars.

Keep brainstorming even when it is out of fashion. Lots of new-fangled, jargon-ridden techniques appear daily. A decent brainstorm is still the best method of blowing away the cobwebs and seeing new opportunities. But run it properly.

Refresh is a word we associate with impending disaster in a computer. It applies equally to businesses that are – or are not – doing well.

Refreshment is the basis of their survival.