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Sunday, 9 December 2012

Why Should I Come in Early? I’m a Director Remember!

It is constantly surprising to realise that some leaders really don’t seem to understand that their example is followed by people in the business and therefore, what they do and how they behave is crucial.

The story goes that some years ago now, a major London based PLC acquired a very large, underperforing engineering company in Manchester.

The PLC Chairman, somewhat reluctantly, emerged from his Mayfair office to visit this company in the frozen north.

After the obligatory works tour the Chairman was invited to lunch in the Directors’ oak-panelled dining suite where he sat at the head of the table lunching in his usual frugal manner on an apple and some cheese.  The Directors meanwhile where chomping their way through their usual four course lunch
At the end of the lunch, the Chairman looked at the Directors and said:
in something of a silence.
“You chaps do yourselves very well here, don’t you?  Perhaps you could consider it”
and walked out.  Changes were made pretty rapidly.
At about the same time I was asked to go into a smallish printing company where the Directors had done a Management Buy-Out from the owner, funded by their bank.
Performance of the business after the MBO had been, to say the least, indifferent and the bank, naturally, was beginning to get somewhat nervous.  Accordingly they sent in one or two consultants to look over the business and to see where the problem lay.
Talking to the managers who were now Directors of the business, it transpired that although they had mortgaged their homes to buy in to the deal, their behaviour afterwards was odd in the extreme.
The first thing that they had done was to present each other with a large top of the range car even though cash was understandably tight.
Then we noticed that they were “working” somewhat short hours, coming n after 9.00am, taking a long lunch and leaving in the afternoon.
When they were asked about this behaviour they looked rather surprised and said the equivalent of “Isn’t that how Directors behave?”  In the end the original owner bought the business back and replaced the Directors.
In truth, they needed to realise that the ownership of a business means much harder effort, longer hours and total dedication to the cause and in addition, to remember that keeping their homes depended on the success of the business,
Both of these stories, in very differing companies but with the same behaviour at the top, reflect an attitude of implied superiority over the lower classes which cannot be helpful to relationships.
There is no question that this engenders resentment, indifference and apathy in the workforce and builds up an “us and them” environment where militancy can flourish.
In the case of the PLC acquisition, it did just that until the new owners changed the whole approach to the people in the business and indeed the whole culture of the company.
It takes time to make changes like that and it is obviously far netter never to arrive at the need.
Humility in a leader is seemingly rare but until he/she realises that they are not omnipotent, then the “top down” approach will dominate.  I like this quotation which exemplifies the inclusive style of leadership:
“The people want me to be their leader – I must follow them”
It is the acceptance that they don’t know everything, that their contribution to the business while important is not all encompassing and that there are many other people whose contribution is manifestly vital.
Once that is understood, the leader is much more likely to be trusted and equally will be more able to trust the people.
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