The pitfalls of operational excellence in HR & elsewhere

The pitfalls of operational excellence in HR & elsewhere

Organizational excellence is based on best practices, best practices consist of processes, and processes must be sustained. Three types of grave consequences MAY originate from this simple premise:

– lack of leadership within the organization

– lack of adaptability and change readiness

– lack of innovation

Best practices are called so because they become the standard across an entire industry, which means that an entire industry becomes like one organization.

No matter which one of the numerous definitions of operational excellence we look at, we will surely come across with the terms performance, quality, efficiency and cost. Naturally the value of all of these factors should be determined by the strategy of the organization and the strategy of the organization should be determined by the identity of the organization.

Reality is that factors like performance, quality, efficiency and cost have become THE strategy for most organizations, which is only possible if the company lacks identity. This means that most organizations in a given industry –players and suppliers alike- have become an undifferentiated mass.

The paradox is simple: the more obsessed an organization is about operational excellence, the more mechanical it becomes and the more mediocre the people performing the processes are, or forced to be. The organization is not dedicated to acause, it is dedicated to the maintenance of processes: essentially it has no purpose. At this stage it rewards mediocrity with leadership positions and administrators run entire industries.

Due to the large number of players in each industry in advanced economies, and due to a substantially quantitative mindset that is predominant in administrative functions, an entire industry becomes like the weakest organization in that particular industry. This is one explanation why in most industries true innovation comes from the periphery and not from the mainstream.

This applies everywhere and when it comes to internal functions (clients) we may pick any division as an example: marketing, PR, IT, engineering sales, whatever.

For now let’s look at recruiting in particular and HR in general. Recruiting is interesting because this is an industry where innovation and leadership is almost non-existent, and change readiness merely means lack of control. Everywhere in the world recruiting companies operate almost identically (and so are HR departments) and the tendency of degeneration seems to be unstoppable, yet all players have unbridled enthusiasm for what they are doing.

The problem is systemic and it is more visible at recruiting companies and the vast majority of executive search firms and perhaps a little less visible at elite executive search firms that handle C level and board level assignments in mature markets, although the regression of the industry maybe observed among them as well.

Recruiting companies look for people with more specialized skills, while executive search firm look for people with more leadership skills. We don’t have room on touching on the problems of the “skills based, or “specialized” leadership phenomenon here, it is enough to mention only, that these “leadership concepts” are themselves the result of a declining tendency and one of the contributing factors to the degeneration of the executive search or “leadership business”.

How to recognize the culprits:

– the style of behavior and the expectations of clients (HR managers on various levels and hiring managers representing areas of specialization) towards recruiting companies. The behavior reflects rigidity that comes from the administrator attitude, which is favorable for the maintenance of the system. Communication protocols within the organization are mostly non-existent, most projects are not launched appropriately, or they are launched for the wrong reasons, meaning that expectations continually change, but the reason for change is often the rationalization of previously made wrong decisions, or solving the results of these. Mostly there is a general lack of control and a general confusion because most actors in the process do not know what they are doing and why.

– The behavior of the recruiting organization is also rigid, they maintain their own processes both when communicating with clients and candidates, trying to accommodate the clients’ changing expectations as much as possible. Motivation of the actors in the system, similarly to the client organization, is to perfectly maintain their part of the system, performing the process that is assigned to them. Activities are highly quantitative, almost impossible to discover any trace of quality and depth. Rigidity is so pervasive that there is no essential (qualitative) difference even between the behavior of older and younger actors – and this is more than alarming since it is not the younger who acts wiser but the older who acts immature.

General conclusions

– once an organization becomes bureaucratic, best practices may hurt more than help

– bureaucratic organizations are desperately buying best practices from less bureaucratic ones, because they can’t develop them internally: the organization can’t think

– the key is to de-bureauctratize periodically

Tagged , .

Laszlo Kovari is a writer and the founder of Prakhsis, an organizational development company that has been a pioneer in the concept of organic organizations. As a "consigliere" he has worked with founders, managers, CEOs and board members at startups, mid-sized companies and some of the Fortune 500 across North America and Europe. Laszlo is based in Prague, Czech Republic, supporting clients across Europe.

Leave a Comment

Your email address will not be published. Required fields are marked *