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Four Sources of Mismanagement at Professional Service Firms
by Tom "Bald Dog" Varjan, Organisational Provocateur
In spite of having seen thousands of companies appointing their managers based on the wrong criteria, history keeps repeating itself. We all laugh when the highest-performing salesperson becomes the sales manager, and the company's sales go south, often crashing straight into the welcoming arms of a penguin on the South Pole.
And what happens next?
The very same people who laughed yesterday end up making the same
mistake tomorrow.
Firms keep appointing managers for good behaviour, tenure, highest number of billable hours, daily coffee consumption and amount of bones brought for the owner's dog.
However, it is always a big mistake to turn people into managers just because they are the best lawyers, accountants or the cleverest geeks with the largest pile of Microsoft certificates. It only means they are the best at performing the job itself. But when we consider that the job of managers is to inspire and empower their people to achieve the firm's vision, then we can see why traditional methods of appointing managers is a call for disaster
There are four major sources of mismanagement, however, the price firms pay for these mistakes is the same: High talent turnover and a lack of ability to attract top-tier talents to the firm. Jobseekers come and go, but people who are serious about building their careers with a great firm will avoid the firm like the plague
Now you may say, "Hey Tom, I am a solo professional and none of this stuff applies to me". Well, not at the moment, but the situation may change in the future. Also, as you are working on client projects, you have to deal with appointing various people to manage and overlook various aspects of the project. So, you cannot escape. At some point in your career you must become a manager even of you are a solo professional
However, many readers of this newsletter are owners and senior partners of firms of various size
Source No. 1 - Role of Management Is Undefined
At many firms managers carry on doing what they had done before they became managers. Although now they have a role of achieving the firm's objectives through people by mobilising and energising their intellectual, emotional and creative resources, but first and foremost they are still accountable for the "technical" work.This sends managers a message from high above: "Just do whatever you were doing before to produce your billable hours, and if you have time and inclination, also harass your people a little bit." It is the same as telling a general he is accountable for digging so many trenches a day, and if he has time and inclination, he can conduct the war as well. But digging the trenches is mandatory
Peter Drucker is absolutely right in saying: "Ninety percent of what we call ‘management' consists of making it difficult for people to get things done." Most managers get evaluated on how many billable hours they can "conjure up" and how busy they appear. So, they play the role, look appropriately busy and stressed, but that is the same as the impotent father: The role is filled but there is no production
Managing client work and communicating with their people seem to have been put on the back burner. Many firms talk about teamwork, but in reality it is non-existent. And it is not even surprising, considering that the new manager is the same "trade barbarian" who was yesterday, but today s/he has a new title and maybe a new office, but definitely not a dickybird of management education
Source No. 2 - Managers Are Chosen Incorrectly
There are three key skills to consider for managers: Conceptual skills, people skills and technical skills1. Conceptual skills are about big picture thinking and the ability to synthesise, that is, putting the pieces together. The higher in the pecking order are, the more conceptual skills are needed. Yet, managers are selected on their technical and analytical (taking things apart) skills. Managers must be able to contribute to the firm's innovation, and innovation is about putting things together in previously unknown ways. The world is flooded with analysts, but there is a chronic shortage of "synthesists"
2. People skills are about interacting with people, requesting results from them and helping them to achieve those results. People skills are very important to every manager, regardless of position in the firm. Yet, look at most managers'. For more on this topic, read The 2R Manager: When to Relate, When to Require, and How to Do Both Effectively by Peter E. Friedes
3. Technical skills. In spite of conventional wisdom, technical skills are what managers need the least. Ray Croc did not flip one single burger in his whole life but built a burger empire. He did not know how to make burgers, but knew very well how to build a business that profitably sells burgers. The fact is that on a managerial level, less than 15% should be given to technical skills and technical education. Interestingly, most firms do not even allow anything besides technical skill building for their people
So, if these skills make up good managers, what is the reason behind idiotic career ads like this: "IT Director Wanted. Must have a Master's Degree in computer science and must be proficient at C++, Flash and Visual Basic, and able to type at 50wpm."
And then this specification is handed over to the - more often than not anal retentive – HR goons, who create rigid hiring procedures and check resume against resume in a human bidding war, coming up with results like: This person is great but s/he can type only at 49wpm. This is how plantation owners selected slaves to pick cotton a few years ago. Today, most businesses pick their "corporate slaves" the same way
The problem lies here: How much typing and programming will an IT director do? If s/he has to do more than minimum, then the firm is drastically screwed up at a strategic level, needing immediate help. A director is a director, not technician
Source No. 3 - Hardly Any Management Education Is Provided
The Peter Principle is alive and well. Most people get promoted to their level of incompetence. This happens to most managers. Becoming a manager is treated as a promotion instead of just another position within the firm. So, since it is a promotion, everybody wants to achieve it, so people do their best to win that "prize"In a way it is similar to formal education, which has become a system which pushes people through certain exams and gives out – most often useless - certificates for big piles of money. If people can learn something, that is just added bonus, but the main goal is to "sell" enough certificates that justify the school's existence
At the same time the business community is screaming like a stuck pig that the new graduates are utterly unemployable because in spite of their fancy certificates, they have no idea how real life works
And this has reached ridiculous proportions in certain countries. Here in Canada you have to go to school and get certified in flagging traffic at a road construction site. Intelligent people who finance homes, buy and drive cars and bring up children are deemed to be too stupid to control a couple cars at a roadwork site. I actually believe that more often than not it is the organisation that brands people too stupid, and people just live up to the expectation
For managers technical and analytical knowledge are highly overrated. A large chunk of technical competence must be replaced with interpersonal, social and emotional competence. Skills in analysis - taking things apart - must be replaced by skills in synthesis - putting things together - skills
Hey, a brain surgeon makes much more than an autopsy doctor. After all, the autopsy doctor only takes things apart on the body. It is the embalmer who has to put the body into presentable condition. How do I know? I used to be one of those embalmers
It is easy to tear things apart. It is a lot harder to put them together in different ways and creating totally new things. I guess we are talking about innovation here above and beyond being an "innovative embalmer"
Source No. 4 - How Managers Are Rewarded
Managers are supposed to manage, but get rewarded doing the work themselves, that is for personal billable time. Again, can you see the unethical aspects of time-based billing? The managing part is of secondary importance, and the emphasis is on "conjuring up" as many personal billable hours as humanly possible.And quite often this message nicely jives with the firm's mission: "Our mission is to continually and consistently screw our clients and our people in order to fatten the partners' personal bank accounts."
And guess what? This becomes the mantra around which the whole culture is created, and people start acting out that culture. The best people will be appalled and leave, and the firm starts attracting people who are comfortable with living by situational integrity, that is, whatever makes us money right now is ethical
This approach also totally undermines teamwork. Team members know that whatever they do, the boss will always push them even harder because the boss' bonus is on the line
Summary
So, if you are a manager at a firm, you can apply these ideas almost directly. If you are a solo professional, you are clicking back and forth between being a manager and a technician. Put on your manager's hat and examine "You the Technician". What do you see? How would you coach that technician that s/he can achieve in a more valuable (higher fees) but less labour intensive way?
How could s/he be more productive with less sweat on her/his brow (busy-ness) and more thinking and purposeful acting (productivity)?
Copyright 1997-2008 Tom "Bald Dog" Varjan. All rights reserved. You are free to use this article in whole or in part. One favour though: Can I ask you to you include complete attribution, including a live website link. Also, can you please let me know where you plan to publish the article.
The attribution: This article was written by Organisational Provocateur, Tom "Bald Dog" Varjan of Dynamic Innovations Squad, a firm specialising in helping consulting firms to sell their expertise at the highest margins. Get Tom's free Practice Management Black Paper when you sign up for his monthly newsletter, Commando Consulting: Lessons And Practices From The Ultimate Professional Service Firm, The Military. Visit Tom's website at http://www.di-squad.com.
Copyright 1997-2010 Tom "Bald Dog" Varjan & Dynamic Innovations Squad, All rights reserved. Vancouver, BC, Canada
As you grow your people, in return, so they grow your firm