After working in leadership roles for a decade, I’m still baffled at how cultish large organizations can be.
No matter where I look and what former colleagues tell me of the places they now work at, I hear the same stories of tools and structures: dysfunctional performance appraisals, OKRs of dubious quality, broken managerial hierarchies, and always some flavor of agile methodologies when in fact nothing is agile.
Every single of those tools and practices can usually be tracked to a single company that developed it to solve a problem they had locally, and then some consulting firms heard of it and productized it into training material that they could charge money for.
And so we end up with processes, each from its own distinct cultural context in which it was working and effective, being passed to consultants who don’t fully understand that culture. And then those consultants go on to train employees at other companies who find themselves two degrees removed from the source, and who naturally are struggling to make sense of it. And I’m being generous here, because often you have a chain of consultants who have taught one another to the point that everything has been watered down to oblivion, and all that’s left is language.
Without going into too much detail, I will start by covering three examples of decontextualized practices and how they fail to fulfill their original purposes.
Objectives and Key Results (OKRs)
OKRs are credited to Andy Grove at Intel who himself evolved the idea out of Peter Drucker’s MBOs. Then OKRs got repackaged at Google, and have now taken over the world as the best way to set goals in organizations, surfing on the halo effect of Google’s success over the past two decades.
Most data about OKRs, such as the OKR Impact Report, cover vanity metrics and qualitative data such as how leadership and employees feel about being aligned, focused, and transparent. And the majority of the positive reports on OKRs come from consulting companies that are selling training on how to roll out OKRs—not exactly an objective viewpoint.
As for the hard data, I couldn’t find any: there is no empirical evidence that OKRs have an impact on cost efficiency, profit generation, or an increase in stock price. And on the contrary, I could find many lengthy articles covering how difficult it is to implement OKRs correctly and how OKRs can harm an organization.
Don’t get me wrong here, I do agree that setting goals and communicating them transparently will have a positive impact on any organization. I just challenge the value of a system that requires entire books to be described.
While it’s unclear where performance reviews originated, it’s probably a mix of Ford Motor Company, IBM, and General Electrics, at which ancestor processes appeared around the 1920s, a time at which managers believed they could apply concepts from manufacturing and assembly lines to people management.
A meta-analysis of 607 studies published by The Psychological Bulletin in 1996 showed that the performance of employees decreased 30% of the time after performance reviews. Sources: here, here, and here.
A 30% decrease in performance isn’t exactly what I’d call a success for a process centered on managing and improving performance.
Guilds, Squads, and Chapters
Made popular in tech companies by content published by Spotify, the concept of guild-based organizations made its way through agile consulting companies that ended up advising it to their clients, only to realize years later that Spotify never really used the model but also didn’t bother take down all their content, leaving the rest of us thinking that it worked when in reality the squad concept at Spotify had failed.
I could go on with a long list of practices and gimmicks, including Holacracy and its derivatives, the overuse of Six Sigma, quarterly business reviews and other shallow reporting, and all the flavors of agile methodologies that require more than one page to be described. But I won’t describe those, as the three examples that I developed above are enough for me to make my point.
What do these three examples have in common? They are no different than cargo cults. And what’s funny is that you can take any executive at any major corporation and show them the Wikipedia article for cargo cult, and they’d probably give it a smile and think how strange and silly it is. And yet, they and we are all collectively doing the same thing with rolling out decontextualized business practices which we don’t fully understand, and without checking if they fit the culture and needs of our organizations, simply because those were once praised at a successful company somewhere, and because they are the hallmark of “industry standards.”
And there you go. Instead of driving organizations using critical thinking and establishing cultural norms aligned with the strategy and heart of each company, we end up with every company looking and feeling the same, and the entire corporate world blending into a sort of homogeneous global cult, praising the same ritualized processes because everybody knows that it’s the best way to do it, and if you don’t do it this way it must be because you’re crazy, stupid, or incompetent.
That’s why it’s common to see newly promoted or newly hired executives in large organizations introducing one or more of those processes. Those people get promoted to the point of having no clue, and the safest next move is to introduce practices that are industry standards, even if they’re not really needed or not in the best interest of the company, because nobody ever got fired for introducing OKRs, right?
We now find ourselves with corporate processes that are just ritualized and performative: being an executive has become an acting job, in which one has to perform whatever rituals are required by the corporate world with the right level of confidence and so called executive presence.
All corporations now have belief systems, rituals, governance bodies, and hierarchical ranks that are standardized across industries to facilitate worker mobility. But when you look closer, it’s actually not so far from any organized religion, which is not so surprising given that we have a deep human need for achieving a sense of belonging, and that to achieve it we accept to conform by spending time together worshiping the same thing, whatever the definition of worshiping you want to use in any local context. We just have to accept this fact and remember that it’s just part of the job.
When I was writing this article, there was one thing I found ironic above all. It’s that most of us are biased to think we’re smarter than cargo-cult tribesmen of the Pacific islands, simply because we’re seemingly more technologically advanced. And yet here we are, running decontextualized rituals at work from our expensive computers and connected via live video streams across the planet, not realizing that like the tribesmen, we just have no clue.
IQ scores and tech proficiency are too often taken as synonymous for intelligence, and make us neglect to spend time honing all the other types of intelligence, critical thinking, and the search for objective truth.
All of this because as a species, we need to belong more than we need to win.
Photo credit: Frames For Your Heart