3 Qualities of People Who Drive Transformative Change

Transformation isn't easy. It requires changing not only people's minds but also their hearts. People who drive change share these three traits.

BY EKATERINA WALTER

 

Transformation isn't easy. It means making people think and feel a different way Not a simple task.

But in the history of mankind, there are plenty of inspiring examples of people who brought forth transformative change. Facing plenty of negativity, they did so fearlessly, never giving up, never backing down. So the question becomes: What is the magical human formula that drives people like that?

This week at Inbound in Boston I had the pleasure of hearing Malcolm Gladwell, who talked about the same very topic. According to him, people who drive transformation share three traits:

Courage

Courage to explore the unexplored. Courage to defy the naysayers. Courage to persist when the whole world seems to be against you.

People who possess courage are:

• Massively open and incredibly creative, willing to consider all kinds of innovative solutions.
• Conscientious, willing to follow through on their ideas.
• Disagreeable and independent, willing to disagree with what the world perceives as a "norm."

The combination of these three traits is what brings true magic to light. Some people are creative but not conscientious--they have no ability to execute on the idea. Some are great at execution but lack the openness. It is also not enough to have ideas and the discipline to carry them out. One has to tune out the naysayers, and the rest of the world, if necessary. The last one, though, is extremely hard for us humans to do because we naturally crave approval of our peers.

Ability to reframe the problem

Transformation requires reimagining every step of the current process. And that includes hiring, because people who are holding on to the legacy solutions are not those who will help you bring the transformation forth. You need people with a fresh outlook and a new mentality.

You also have to reframe the problem.

In the early 1920s, David Sarnoff was one of the people credited with helping radio become an entertainment necessity vs. a luxury. When the outdoor heavyweight championship boxing match between American Jack Dempsey and French challenger Georges Carpentier was dubbed the "Battle of the Century," Sarnoff pitched the idea to broadcast the boxing match to the Radio Corporation of America (RCA). When they declined to do so, Sarnoff did it himself. And so, in 1921, they called it "the largest audience in history"--the 300,000 or so people estimated to have heard one of the first radio broadcasts of a special event. And suddenly radio wasn't just an expensive box that brings you the same news that plenty of newspapers did. Radio became a device that brought the world live into your own living room. Radio sales exploded, and it became mainstream.

What Sarnoff did was reframe the problem.

Sense of urgency

Innovators not only have courage to withstand the naysayers and the vision to reframe the problem but also possess a wicked sense of urgency, of getting stuff done, now. A lot of companies produced the innovations they didn't actually invent (they copied them), but because they acted upon the idea--no matter how imperfect--they were credited with those inventions first. And reaped the benefits.

Steve Jobs didn't invent the mouse, Xerox engineers did. But Jobs saw the brilliance of the idea and had to implement it. And he did. By the time Xerox came out with its product, Macintosh had already launched a far superior one. What set Jobs apart was his agility and burning desire to get it done.

Change is so hard for so many because of the difficulty of letting go of the legacy that was already built, no matter how outdated it is. Someone's identity is tied into the old way of thinking. It is a threat to someone's ego. The view is different from the ivory tower than from the streets. But to stay relevant, one needs to be open to transformation, even if it means rebuilding from scratch what one spent years constructing.

Will Human Resource Development Survive?

by Darren C. Short, John W. Bing, and Marijke Thamm Kehrhahn

We, the authors, experience human resource development (HRD) as a paradox. This is a time when HRD appears to be at its strongest in terms of publications and research outputs and when the environment appears right for HRD to demonstrate clear value-added to key stakeholders. However, in other ways, HRD appears inner directed and without substantial impact: publications seem to preach to the converted; HRD research and, to some degree, practice appear divorced from real-time problems in organizations; HRD professionals see their work being completed by those from other professions; there is limited evidence that HRD has really moved far from the fad-ridden gutters of false short-term training panaceas; and practitioners are still measuring training person-hours rather than the relationship between learning and productivity.

Every year, the members of the ASTD Research-to-Practice Committee are given an opportunity to write an editorial for HRDQ. Two years ago, Dilworth (2001) described the committee’s work in exploring the future of HRD. Last year, Short, Brandenburg, May, and Bierema (2002) summarized the main trends identified by that work, focusing on the implications for HRD of the increasing pressure for organizations to deliver shareholder value, the trend toward globalization, and the need for just-in-time products, services, and solutions. Since then the work has been extended and prepared for publication in a forthcoming issue of Advances in Developing Human Resources.

From this body of work a number of major challenges have emerged. These are macro issues that address the question: What challenges must the HRD profession overcome to ensure the effectiveness and success of the field in the coming years? Here, we set out challenges to provoke thought and action. Our intention is to encourage HRD’s multiple stakeholders to join in a spirited discussion on the future of HRD.

Challenge 1: Responding to Multiple Stakeholders

The ongoing critical debate about whether corporations have a responsibility to a wider group of stakeholders beyond their focus on shareholders continues to capture attention (May & Kahnweiler, 2002). HRD practitioners are caught up in the shareholder-stakeholder debate, in part because they are responsible for the learning supply chain that supports organizations. HRD cannot blindly focus on shareholder value alone if it must also respond to learning supply chain stakeholders, including primary, secondary, postsecondary, and postgraduate education institutions; continuing education, training, and development entities; just-in-time knowledge delivery systems; and other learning solutions both inside and outside corporations. As companies proceed from manufacturing to "mentalfacturing," not to take a strong position in support of the interests of learning supply chain stakeholders is as reckless as it would be for a senior supply chain manager to disregard the various contributors to the manufacturing supply process.

The suggestion that HRD orient itself to multiple stakeholders implies that HRD professionals should promote corporate accountability beyond shareholders to communities and societies (Kaufman & Guerra, 2002). Perhaps HRD professionals will be able to educate the organization on the meaning of social responsibility and its relationship to corporate performance, while demonstrating effective strategies for addressing multiple needs and negotiating various stakeholder interests. No doubt, there is risk in taking a bold position in favor of stakeholder interests, but the risk is greater in doing nothing.

Challenge 2: Measuring HRD Impact and Utility

To establish themselves as key players in the development of organizational strategy, HRD practitioners must demonstrate how what they do correlates with the productivity and welfare of the company (Russ-Eft & Preskill, 2001; Swanson & Holton, 1999). The future of HRD depends to a great degree on the extent to which the value it brings can be confidently measured. We believe that a focus on demonstrating impact and utility will not only lead to greater overall influence of HRD on the organization but will strengthen HRD’s reputation as a legitimate profession. Therefore, over the next decade, linking learning and human process to performance and measuring learning, human process, and the resulting change in performance are crucial challenges to the field. Well-designed studies linking learning to productivity will be critical to these efforts.

HRD professionals must become skilled systems thinkers who can design and conduct measurement and analysis across the organization and pinpoint the influences of HRD efforts on employee productivity and organizational performance, linking past research results to current practice. HRD professionals must have the skills to identify valid measures of learning and growth and develop meaningful and accurate interpretations, while being ever mindful of the myriad of intervening variables that can influence learning and performance curves in work settings (Preskill & Russ-Eft, 2003). Ethical engagement in measurement work will maintain integrity around the complexity of learning and performance processes and will protect against laying shortfalls on the backs of learners and those who facilitate their learning.

Challenge 3: Orienting Toward the Future

We are concerned about how little time HRD spends focused on the future. Its research and theories struggle to keep up with the present, let alone anticipate what may be needed in the coming months and years. The void is filled by the fads, which falsely offer panacea solutions and lead to the poor reputation of HRD in delivering real long-term outcome benefits. To put it another way, HRD contains some products that are "quick-fix, flavor-of-the-month, buzz-worded remnants of a slick sales job" (Leimbach, 1999, p. 1).

Yet practice desperately needs to benefit from research and theories that apply to leading-edge issues. The challenge to HRD researchers is to anticipate what research is needed and how it can contribute to HRD practice in one, two, or three years, and then to make it available in ways that maximize the likelihood that research findings influence practitioner behavior. The ability of our profession to be consistently ahead of the game will elevate the status of HRD as a key investment in the knowledge economy.

It is just as easy to be critical of HRD practitioners for failing to focus on the future. Many are running learning activities that are out-of-date relative to new business strategies and new knowledge about learning, and the same practitioners are often late to the table when it comes to discussions on the potential learning implications of likely business decisions. The challenge to HRD practitioners is to be strategically proactive rather than reactive.

Challenge 4: Focusing on Problems and Outcomes of HRD Practice

Organizations are arenas with real problems that cry out for solutions. Yet the field of HRD appears to get lost in exploring its own processes. A glance through published research shows a wide variety of research agendas in HRD, but how many of them are focused on solving real problems that matter to stakeholders outside HRD? Chermack and Lynham (2002) listed the top twenty symposia topics from past conferences of the Academy of Human Resource Development. Included in the list are such internal process issues as core directions in HRD, university HRD programs, and advancing the profession through journals. Absent from the list are the major trends identified by Short, Brandenburg, May, and Bierema (2002): the increasing pressure for organizations to deliver shareholder value, the trend toward globalization, and the need for just-in-time products, services, and solutions.

By focusing on outcome-level problems and determining the HRD contribution to the solution, HRD is forced to think systemically and deliver a major contribution. HRD authors need to cease writing for the converted and seek a significant contribution in the world of those who are yet to be converted and those who could be labeled as being unaware that HRD could have any role in finding the solution to their problems.

The challenge to practitioners is to move beyond a silo mentality in which solutions can be found only within HRD and to embrace a perspective that organizational problems are systemic and require systemic solutions. This requires that HRD practitioners work in problem-focused, solution-driven, multidiscipline teams within organizations.

Challenge 5: Achieving Professional Recognition

HRD is a relatively young field. Few outside HRD consider it a profession. Chalofsky (1998) argued that HRD had yet to reach the level of a mature profession because practice is based on guesswork and not on theories tested by research, practice is based on research and thinking that are at least ten years out of date, and practice is based on what the client wants rather than on what works.

As long as HRD is seen as fad driven and reactive and those who lack a sound understanding of core HRD theory and practice fill HRD jobs, then HRD will be viewed as secondary to other professions in organizations. Although it will mean painful effort, either further professional development of practitioners or the loss of existing people, HRD as a profession needs to take specific steps to increase its credibility in organizations and its recognition as a discrete field of research and practice.

Efforts to build professional recognition will require HRD to construct a sound theory base and apply those theories in practice. As Swanson (2001) stated, "HRD practice does not come close to what we know from sound theory" (p. 309). The efforts will also require a sound education for HRD professionals with accompanying professional recognition and continuing professional development, and ethical standards that are understood and applied by professionals and overseen by professional bodies. More important, as we promote awareness and recognition of HRD as a profession, we must keep our focus on values, ethics, the quality of practice, and a set of competencies through which both research and practice can be undertaken, and avoid investing energy in the building of bureaucratic processes of credentialing and standardization.

Conclusions

HRD is a relatively young field, and there are significant challenges to its future. Failing to acknowledge these challenges will increasingly marginalize HRD within organizations. The tasks seen as central to the HRD profession will be taken on by others who work in professions more focused on delivering and measuring outcomes, thinking and working systemically, with a sounder theoretical base, with clear standards and ethical codes, with stronger professional bodies and competent practitioners. HRD will be left on the sidelines: a gradually shrinking number of people who write for themselves, focus on internal process issues, and react ineffectively to demands long after they have been formulated.

We invite all those with a stake in the future of HRD to join together to grapple with the critical challenges that face our field, engage in deep mean-ingful dialogue about the challenges, and construct workable, effective, and immediate approaches to addressing the challenges to secure the future of HRD. Our goal is to banish complacency and to encourage dialogue. HRD’s human resources are impressive; they must now be focused.

References

Chalofsky, N. E. (1998). Professionalization comes from theory and research: The "why" instead of the "how-to." In R. Torraco (Ed.), Proceedings of the Academy of Human Resource Development. Baton Rouge, LA: Academy of Human Resource Development.

Chermack, T. J., & Lynham, S. A. (2002). Assessing institutional sources of scholarly productivity in Human Resource Development from 1995 to 2001.Human Resource Development Quarterly, 13 (3), 341–346.

Dilworth, R. L. (2001). Shaping HRD for the new millennium. Human Resource Development Quarterly, 12 (2), 103–104.

Kaufman, R., & Guerra, I. (2002). A perspective adjustment to add value to external clients, including society.Human Resource Development Quarterly, 13 (1), 109–115.

Leimbach, M. (1999). Certification of HRD professionals, products and academic programs. In K. P. Kuchinke (Ed.), Proceedings of the Academy of Human Resource Development. Baton Rouge, LA: Academy of Human Resource Development.

May, G., & Kahnweiler, W. (2002, July). Shareholder value: Is there common ground? T+D, 56, 44–52.

Preskill, H., & Russ-Eft, D. (2003). A framework for reframing HRD evaluation, practice, and research. In A. M. Gilley, J. L. Callahan, & L. L. Bierema (Eds.), Critical issues in HRD: A new agenda for the twenty-first century. Cambridge, MA: Perseus Press.

Russ-Eft, D., & Preskill, H. (2001). Evaluation in organizations: A systematic approach to enhancing learning, performance, and change. Cambridge, MA: Perseus Press.

Short, D. C., Brandenburg, D. C., May, G. L., & Bierema, L. L. (2002). HRD: A voice to integrate the demands of system changes, people, learning, and performance. Human Resource Development Quarterly, 13 (3), 237–241.

Swanson, R. A. (2001). HRD and its underlying theory. Human Resource Development Interna-tional,4 (3), 299–312.

Swanson, R. A., & Holton, E. F., III. (1999). Results: How to assess performance, learning, and perceptions in organizations. San Francisco: Berrett-Koehler.

This Editorial originally appeared in the Fall 2003 Human Resource Development Quarterly, 14 (3), pp 239-243.

The Impact of Culture on Mergers & Acquisitions

by Gene Gitelson, John W. Bing, Ed.D., and Lionel Laroche, Ph.D., P.E.

According to a KPMG study, "83% of all mergers and acquisitions (M&As) failed to produce any benefit for the shareholders and over half actually destroyed value". Interviews of over 100 senior executives involved in these 700 deals over a two-year period revealed that the overwhelming cause for failure "is the people and the cultural differences". Difficulties encountered in M&As are amplified in cross-cultural situations, when the companies involved are from two or more different countries.

Seven Pitfalls on the Path to Merger Success

Merger success is possible; however, being part of the 17% that succeeds, rather than the 83% that does not deliver, requires more than insight. Merger success is based on acceleration, concentration and creating a critical mass for operational change (adaptation).

Up to the point in the transaction where the papers are signed, the merger and acquisition business is predominantly financial - valuing the assets, determining the price and due diligence. Before the ink is dry, however, this financially-driven deal becomes a human transaction filled with emotion, trauma, and survival behavior - the non-linear, often irrational world of human beings in the midst of change.

The seven pitfalls represent the critical and vulnerable areas of the M&A transaction. These areas must not only be valued for their negative impact on the critical success factors that drove the "deal", they are the very agenda for the organization's action in the critical first 90 days of the new entity.

In the case of international mergers and acquisitions, the complexity of these processes is often compounded by the difference in national cultures. People living and working in different countries react to the same situations or events in very different manners.

Therefore, a company involved in an international merger or acquisition needs to consider these differences right from the design stage if it is to succeed.

Pitfall #1: Preoccupation

In Canada, individual preoccupation with "How is this all going to impact me?" weakens commitment to the job at hand. This, in turn, translates into people looking for work in other companies. Often a firm in the midst of transition loses some of its own talent - strengthening the competition.

In countries where people identify largely with groups, people tend to look for support within their group. In France and Italy, people caught in the midst of a merger or acquisition often turn to unions. If unions cannot provide answers because they have been excluded from the negotiation process, they are likely to go on strike. These strikes may do much more damage to the organization than comparable Canadian strikes; for example, the strike by French railroad and subway workers in December 1995 resulted in the demise of the Juppé government.

What is less apparent is the pervasive loss of productivity of those who remain. Studies indicate that line employees and managers at all levels lose a minimum of 15% of personal effectiveness as a result of rumors, misinformation, and worry. They also indicate that teams tend to break down and become less effective during mergers and acquisitions.

To quantify these losses, determine the number of individuals involved, multiply by their fully-loaded hourly wage, consider just one hour lost to confusion, waiting for clarity, figuring out who should do what to whom (assuming you know who "whom" is) and a likely job search. This is how much productivity is lost per day to the company (and the new owners). Multiply this by 65 (there are 65 working days per quarter) and compare this number with the amount in gross sales revenue that the firm will have to generate to the bottom line to offset this loss in productivity.

The strategy: Acceleration. Speed the integration to reduce the uncertainty and anxiety. Delayed decisions to "ease the pain" only magnify and sustain the pain and prevent the company, the individuals and /or the groups from getting on with the work and their lives. In the case of international M&A's, ensure that both individual and collective concerns are addressed.

Pitfall #2: List-making

You may also call it compulsive-obsessive list-making; whatever the name, it's real. In the face of overpowering uncertainty and rising fears of insecurity, it will happen. Making comprehensive lists is a very logical response to one's world thrown upside down. Lists of things to do fill the space and suppress the anxieties; they even make sense, except to the bottom-line and the economic drivers that were the very basis of the merger.

As soon as the merger is announced and the first calls to action proclaimed, the reality sinks in. The "list" is overwhelming. Personal and departmental needs drive the allocation of resources. Quickly, as the days build, there is a widening disconnect between the financial and market-based goals of the merger and real-time allocation of effort.

Tolerance for uncertainty varies widely around the world and this variation can play havoc in international M&As. For example, Mexicans tend to require more structure and definition of their role and responsibilities than do Canadians. When a Canadian corporation acquires a Mexican company, its Mexican employees are often looking for information and structure that is not forthcoming, because their new Canadian managers deem it unnecessary. The Mexican organization often grinds to a halt, since Mexican employees are unlikely to go and ask for the information they need, since this may be viewed in Mexico as questioning management's authority.

The strategy: Concentration. During the first 90 days, focus and get everyone to focus on the 20% of the goals that yield 80% of the economic value. Dealing with uncertainty explicitly is critical to the success of M&As.

In the case of international M&As, the economic value of a foreign organization may not be where its Canadian partners expect it. For example, a Canadian company acquiring a company operating in a country where the government controls much of the economy may find that the value of its new acquisition lies more in the personal ties between its managers and high level government officials than in its quality of service.

Pitfall #3: Organizational Proliferation

In Canadian organizations, many task forces, committees and integration teams are created to handle all the lists and to plan new lists. Integration structures and transition teams designed to be all-inclusive and to represent a sign of "new partnership" will weigh heavily on an organization seeking to keep its eye on its customers and the market. More effort will be placed on temporary rules and reporting relationships than the work itself.

In the case of international M&As, this issue is compounded by the fact that organizational change is brought into companies in different ways in different countries. For example, in countries where the sense of hierarchy is much stronger than in Canada (like France and Mexico), change is brought about from the top and employees at all levels expect new directions from their managers. This may paralyze cross-cultural M&As, since top Canadian managers expect input from these teams and committees, while French members of these committees and teams expect direction from their managers.

The strategy: Accelerate, concentrate and adapt. Form small, agile, quick-acting teams, including people from both sides of the M&A, with a clear mission and empowered integration team managers with direct access to senior management and to their support. Transitions do not need to be demonstrations of democracy in action.

Clear leadership and strong support is essential to these teams; without it, they often break down into sub-teams (one sub-team for each side of the M&A). This is particularly common in the international case, since language and cultural differences create significant communication issues.

Pitfall #4: Infrequent and irrelevant communication

Fear and a lack of all the answers deters top management from providing the information that customers, shareholders and employees need to redirect their action to the value-added of the deal. Rumor fills mystery and vacuums. When there is communication, it often lacks information and substance that explains and supports stakeholders' interests.

In many international M&As, the working languages of the two organizations involved are not the same. Communication can break down even when the employees of the foreign M&A target speak English. Consider the case of a Norwegian - American joint venture. Because Norwegians tend to be more relationship-oriented while Americans tend to focus on tasks, the parties almost came to blows over when and how to bring the discussions to a conclusion. The Norwegians complained that they had not built up enough trust to negotiate final details and needed more time. The Americans responded that they could not waste valuable time on further meetings and that the matter should be settled by the legal team. Tension decreased when the teams realized that their goals were the same but their ways of achieving them were quite different; a deal was eventually struck.

The strategy: Accelerate, concentrate and adapt. Frequent communication, repeated at least 7 times through multiple avenues - print, voice mail, e-mail, meetings, and video. In times of stress, the "noise" of survival and uncertainty drowns out the message. Over-communicate and remember that responsibility for a message being received lies with the sender as well as with the receiver. A recent PricewaterhouseCoopers survey of 124 mergers indicates that those firms that implemented effective communications strategies showed better results in customer focus, employee commitment and productivity than those firms that had a delayed communication strategy.

In the international case, communication often requires translation as well as adaptation. Indeed, the best way to make a presentation and to reach an audience differs from country to country 1. The communication strategy needs to take communication style preferences into account, as in the Norwegian - American example mentioned above.

Pitfall #5: Triangulation

Without clear lines of authority and clear understanding of where they fit in, employees and managers are caught in a web of conflicting objectives and old loyalties. This type of organizational and personal strangulation robs the new entity of the very energy it needs to overcome the losses in productivity.

The tolerance for "fuzzy", temporary organizational charts and decision-making processes depends on the countries involved in the merger or acquisition. In hierarchical countries, like the Philippines, both organizational chart and chain of command need to be clearly defined, more clearly than in Canada. If employees do not understand them, paralysis often results. A Filipino employee reporting to two managers, as in a matrix organization, will likely be quickly overwhelmed. He / she interprets the situation as having to meet two complete sets of expectations and perform two separate jobs. For Filipinos, asking managers to discuss their conflicting requests would be viewed as insubordination.

The strategy: Concentrate and adapt. Concentrate on substance rather than form, and focus on helping people adapt. Management needs to provide the information that people need to be comfortable with the new organization; this information depends on people's cultural backgrounds. In Canada, people need to know how they fit with the value drivers rather than short-lived organizational charts; such may not be the case in other countries.

Pitfall #6: The relatives

Not the "in-laws", but the relative forces of time and space. Time in a merger is accelerated, compressed and merciless. In Canada, publicly held companies need to show clear results at the end of the first quarter after the announcement. Individuals going through a merger have to work at an accelerated pace at the very same time that the inner adaptation of change - personal and psychological transition - weighs them down and operates on personal, rather than linear time.

Change is easy; inner adaptation is not. And time is relative - the leaders started their adaptation to the new reality far before those who learned of the merger on announcement day. The leaders have ridden the wave and are way in front of this shock wave now crashing down on the others. They wonder about why people don't seem to "get it" and often mistake shock and confusion for resistance to the new realities.

The concept of time is also related to culture. While long-term in North America tends to mean three years, it means up to 30 years in Japan. Consequently, Japanese strategy discussions are likely to take into consideration events that Canadians consider irrelevant, since they are expected to take place beyond the Canadian planning horizon.

Space is also relative. In an increasingly virtual world, those not "connected" in the same space and time feel disconnected from the decisions and the center of the action. Irregular and incomplete communications at headquarters becomes a daunting challenge for those who live in different time zones, regions, countries and organizational units.

The strategy: Adapt. Adapt to the realities of change and transition - they are different experiences and each individual will have their own way of going through them. Help guide and support employees through the endings that they need to come to terms with before you expect them to embrace the new world. Provide temporary structures to enable people and departments to navigate between the old ways and the new. Actively manage the merger across time, space and organizations, keeping in mind the different concepts of time and space that may be at play. Create the appropriate communications tools and the accountabilities and standards that will enable the organization to better operate across time and space.

Pitfall #7: The guiding light

At a time when leadership and active management is most called for, the stress and uncertainties associated with the merger causes an inward focus and a retreat to safe and high ground. More leadership is needed, at this time, than less. One of the primary roles of a leader is to articulate a vision and inspire others to join in that vision. Proclaiming a new vision and handing out laminated cards, however, does not create a new vision for the new entity. A clear new vision captures the critical success factors and economic drivers that brought the entities together.

In the case of international M&As, the need for leadership remains, but the nature of leadership changes. Being a good leader requires different skills and attributes in different countries. For example, charisma and a positive personal image are important attributes of leadership in the U.S., more so than in Canada.

The strategy: Adapt. Only a new culture can create the context for true change to happen and hold. Changing culture means changing behavior. One of the quickest way to effect change and create the new company is to place in all key positions those individuals who are true representatives of the new culture and who can lead effectively people on both side of the company's cultural divide. These people are the role models who demonstrate, with the visible active support of senior management, what the new culture is.

Conclusion

These pitfalls of mergers and acquisitions challenge today's leaders to a new standard of managing change. The strategy is clear - accelerate, concentrate, adapt, and in the case of international M&As, consider cultural differences. The human and cultural issues that separate the 17% from the 83% are not about some abstract values or the "soft stuff", but the concrete reality of productivity, economic value and sustained growth.

References
1 "On with the Show", L. Laroche, CMA Management, December 1999 / January 2000.

Metrics for Assessing Human Process on Work Teams

by John W. Bing, Ed.D.

Management has been defined simply as "getting things done through others."1 Managing and leading complex organizations is challenging, at least in part because the most utilized tools to assess management's approaches are end-point financial measures. Reviewing quarterly profit/loss statements as a guide to management's skills is a bit like measuring a doctor's skills by the apparent health of the patient rather than reviewing the full set of analytic results which more effectively predict health or illness. We know too well that reliance on short-term profit results is no certain indicator of the long-term health of a company. We need other measures, measures that assess both the application of specific managerial approaches and policies in addition to the output measures of financial returns. In so doing, we increase the opportunities open to managers to understand and improve the effects of their policies and approaches.

I suggest in this article that measurement and monitoring of work teams over time is a crucial way for organizational leaders to both support improved team performance and to measure, through the aggregation of human performance metrics on a digital dashboard, changes in team performance and, in turn, to relate these measures to bottom line, financial changes.

CHARACTERISTICS OF WORK TEAMS

Work teams are the backbone of contemporary work life. Executive teams run corporations. Project teams create new products and services; matrix teams are involved in the development of everything from pharmaceuticals to the delivery of services in consulting firms and charitable agencies. Marketing and sales teams deliver products and services to customers. Except in the most traditional of organizations, for example sometimes in governmental organizations in which highly structured departments remain, teams are essential to the way organizations carry out their work.

Global Teams are a special genre of teams. Most of the examples in this article are drawn from global teams. The notion of global teams would have been thought at best unlikely until the last two decades. Within that time, communications infrastructures began to provide efficient support for synchronous and asynchronous contacts between distant employees, and corporations began to realign their workflow through those individuals and those geographical areas most likely to increase efficiencies and productivity. Thus, virtual teams and global teams were created to allow companies to improve competitive advantage. Such teams, however, provide managerial challenges, as the imperative to "get work done through others" is different when the "others" are not found around the proverbial water cooler but are embodied in bits and bytes on computers and telephone exchanges. With increasing distance between team members, it is much more difficult to build trust, which underpins successful teams.2

Cultural and linguistic differences also play significant roles in mediating communications on global teams. Although the business of most global teams is conducted in English, there is typically more than one language natively spoken by members of a global team. These members may have more difficulty expressing themselves in spoken or written English than do their native-English-speaking colleagues.

Cultural differences are more subtle intermediaries. In one project monitored by ITAP International involving a pharmaceutical team located both in the United States and in Spain, there were numerous complaints from the American team members because their Spanish colleagues copied e-mail messages to their bosses, which the Americans perceived as undermining forthright communications. In a meeting convened to work through issues uncovered in measurements of team process,3 the Spanish members of the team asserted that it was their responsibility to inform their supervisors of the progress made by their team; to do otherwise would be negligent.

Dutch pioneer Geert Hofstede measured cultural differences through a five-dimensional system.4 The dimensional set which emerged from his research - Power Distance, Uncertainty Avoidance, Individualism/Collectivism, Masculinity/Femininity, and Long/Short-Term Orientation - is the most researched body of quantitative crosscultural research in the literature. The Spanish scores for one of these dimensions, Power Distance, a measure in part of "subordinates' fear of disagreeing with superiors and of superiors' actual decision-making styles,"5 are significantly higher than those for the United States. That specific difference was the root cause of a number of communications problems within this team. As another example of Power Distance issues, the American department head, who supervised the team, thought that the Spanish supervisor controlled the Spanish contingent too tightly; the two leaders had a number of meetings before this issue was at least understood, if not resolved. In circumstances in which one culture dominates another by virtue of the authority of the home company, such differences are often hidden or suppressed but no less significant and are surfaced through the application of process metrics or, less fortuitously, subsequent team malfunctions.

MEASURING TEAMS

Teams are a bit like people in their complexity and types; and although progress has been made in measuring individuals with respect to their type, development and capabilities, the science of team metrics is in its infancy. This is even more notable in that teams could well be natural units by which top management might most efficiently determine the effectiveness of their policies and leadership; yet management has rarely attempted such measures. Reorganizations and restructurings are common; yet how many have been implemented in which appropriate pre- and postmeasures have been taken to determine the specific areas that require redevelopment and restructuring and most important whether such efforts have achieved desired results?

Indeed, much of the reorganization and restructuring of organizations, which is enormously expensive in terms of time and other resources, might well have been avoided had diagnosis of problems been undertaken and smaller-scale changes made. In addition, in the contemporary organization, teams are perhaps the most appropriate unit around which to make complex and ongoing measures of both human process and productivity. As Jones and Moffett write, "an effective measurement system gives work teams the same kind of business data once used only to manage entire organizations.6

Lacking such measures, it seems quixotic at best and malpractice at worst for management to reorganize work units.

The lack of team output measures also accounts for the difficulties that management has in rewarding teams. Although we have 360-degree measurement (typically in Western corporations) to measure the development of managers, very few team measures exist to support rewards systems for teams. Most team rewards are based on individual assessments rather than team effectiveness.

Management's inattentiveness to such matters is, I believe, a constraint on improving the capacity of complex organizations to become more effective as learning organizations. For if management is not focusing on measuring the effectiveness and productivity of their organizations beyond financial measures, it is difficult to determine which parts of the organization are functioning well, and which are not, beyond a gut reaction. Such measures have the additional value of providing specific diagnostics, and therefore appropriate interventions, when teams falter.

TYPES OF MEASURES

There are two types of team measures to be discussed here, those of team process and those of team output or team productivity.

Productivity Measures

Some types of teams lend themselves to such measures more easily than others, and some measures are more typically applied than others. For example, a top management team might be measured appropriately by shareholders by means of the general productivity of the company in terms of its profit or loss over time; however, at the same time, measurements of the company as a learning organization are also important indicators of the capability of the company to maintain or increase productivity, and these are more difficult to make. At the shop floor level, measures are usually easier and can be made in terms of the number of units produced at specific levels of quality by work teams as well as the safety record of the unit over time; absenteeism, and so on.

Jones and Moffett, in a case study on measurement on work teams, list four common measures on such teams: productivity, quality, cycle time, and on-time delivery. They then note that:

To establish ownership, teams customize their measurement system in four ways. First, they can add a measure of their choosing that reflects the team strategy. Second, within limits they can determine the weighted importance of the measures to reflect their own thinking about strategy. Third, within limits they can set their own performance standards for each measure. Fourth, in some cases they can influence how a measure is calculated so that it comes more under their control.7

However, measurement often stops at the factory level.

While it may be more difficult to define appropriate metrics, various human resources department teams could be measured on the length of time required to recruit specific positions matched with supervisor satisfaction of the successful candidates and the costs involved; on the cost of payroll per employee; and training, by supervisor satisfaction with skills provided to subordinates.

Human Process Measures

Human process measures are likely to be precursors to productivity changes. Why? If communications fail or are marginal on a team, it is likely that productivity drops will not be far behind. If objectives are not clear, then how can a team reach them? If roles and responsibilities are muddy, how can the team efficiently carry out its work? If trust is lacking, how can a team work together? An American general who commanded troops in the first Gulf War commented: "We had an unusually strong team, and trust was a major factor.... You need people schooled and trained in their own type of warfare, and then you need trust in each other."8

Although there is face validity to the above statements, management is often reluctant to carry out measures to determine the degree of comparative effectiveness in these basic areas. In such resistance, there may be many missed opportunities.

COMPARING HUMAN PROCESS WITH OUTPUT ON TEAMS

Although this article is not focused on the measurement of team productivity, or outputs, it is important that human process metrics be combined with team output measures to correlate how changes in team human processes lead to changes in output. Of course, although finding of correlations do not prove causation, repeated correlations over time and with different teams will eventually build a solid base for viewing process measures and interventions as fundamental to improving team productivity.

A decade ago, a Swiss-based pharmaceutical company asked ITAP International to develop a method for measuring process performance on three global teams. The teams were composed of scientists from Europe, the Americas and Japan. They met four times over a period of two years, and continued their team responsibilities during the intervening periods. Their purpose was to create procedures to reduce research and development time in three drug delivery areas: oral, skin and subdermal. The teams were tasked with similar assignments and because the composition of the teams was similar, they became ideal candidates for studying differences in human processes on global teams and comparing results between the three teams.

A questionnaire was developed to measure human process on these teams, and was administered six times over the two-year period that these teams met together. At the end of the two years, specific questions from this questionnaire, now called the Global Team Process Questionnaire™ (GTPQ) were compared with peer rankings provided by the participants. These correlated positively; in other words, the highest-peer ranked team also had the highest GTPQ results on the questions tested.9

In Figures 1 and 2, process questions are correlated with the peer-ranked productivity of each team. In Figure 1, team objectives were compared with quality of output; in Figure 2, perceived communications levels were compared with peer-ranked outputs. In both cases, there were straight-line correlations between process and output.

Figure 1. Team Objectives vs. Quality of Output.

Figure 2. Perceived Communications Levels.

Team Process Examples

Let's review examples of measurement of human process on teams. The teams listed were all (except in one case) measured by the Global Team Process Questionnaire™, mentioned above, which has been construct-validated dimensionally, and which has proven reliable in repeated applications.10

The following examples are all taken from assessments of teams within the pharmaceutical industry. This industry makes extensive use of global teams in basic research, statistical analysis, product development, clinical development, regulatory, operations, and marketing and sales. During various stages of drug development and testing, many of these functional areas are representing on cross-functional coordinating teams supported by single-function teams. The functional teams are able to support a number of coordinating teams. Many of these teams may have member representation from more than one country.

FAILING TO APPROPRIATELY CHARTER A TEAM

One of the most important factors in a team's success is the initial chartering of a team. Chartering is, essentially, providing the internal and external objectives and structure for newly created teams and providing team members with an understanding of their roles and responsibilities. If this step is not appropriately provided, many problems can develop in the future activities of the team.

Figure 3 is the executive summary for a team that had not been appropriately chartered. The executive summary contains five dimensions (in a domestic version of the GTPQ, which has an additional dimension, Culture and Language).11 The domestic version is called the Organizational Team Process Questionnaire™ or OTPQ. Note that in all five dimensions this team lags the pharmaceutical industry averages that we maintain.12 In this summary, 1 is the "best" score and 6 the "worst," so the lower the score the better the outcome.

Figure 3. Executive Summary for an Inappropriately Chartered Team.

Figure 4 is a spidergram, in which each letter on the diagram represents a team member's score for this specific question - "Are the objectives of your team clear?" Only one of the nine team members indicated an understanding of the objectives; the remaining eight did not. This is another symptom of failed chartering and indicates that the team must go through a chartering process if it is to form the basis for teamwork.

Figure 4. A Spidergram.

ADDITION OF NEW MEMBERS INTO AN EXISTING TEAM

Over time, productive teams develop a sense of trust and a common approach to work, which can be disrupted when members transfer out or in. The larger the percentage of team members lost or gained, the larger the consequence.

Figure 5 shows data on four questions taken after the induction of 11 new members and a new team leader (with only three prior members remaining). All four questions show a distinct difference in perspective between the old team members and new members on the issues of team leadership, clarity of objectives, communications and trust. (In this table, 1 = best possible score; 6 = worst possible score). Here is clearly a case in which, based on the data, a new team leader combined with a large influx of new members requires a team rechartering effort. Otherwise, the old members will remain a disaffected group within the larger team.

Figure 5. Team Scores after Induction of New Team Members and Leader

Question	Average Score All Team Members	Average Score Old Members	Average Score New Members	Difference
Effectiveness of team leadership	2.50	3.33	2.22	-1.11
Clarity of Objectives	2.67	3.33	2.44	-0.89
Communications	3.00	3.67	2.78	-0.89
Trust	3.00	3.67	2.78	-0.89

DEGREE OF MANAGEMENT SUPPORT

Management support is an external but powerful force that can either buttress or retard the productivity of teams. Figure 6 is a comparison of two teams, one with perceived management support, and one without such support.

The top spidergram is tight, indicating a team that acknowledges and appreciates management support. The diagram on the bottom shows a team that as a whole believes that management support is lacking, although there are strong differences of opinion. In an intervention based on this data, a facilitator would probe the team for the reasons behind the perceived ambivalence of management support. Management, in turn, would have data indicating that their support was either not communicated or not sufficiently provided.

Figure 6. Comparison of Teams With and Without Management Support.

THE EFFECT OF MERGERS ON TEAMS

There are other outside influences on teams. In an early version of this measuring instrument, three teams were tested over six iterations on a variety of team process issues. On the first five iterations, there were changes in the process effectiveness of the teams, although team B was clearly the leader overall. However, on the sixth iteration, all three teams fell (see Figure 7). At first, we were puzzled. We had expected that our interventions would improve team process and performance. Were our interventions faulty? Then we realized that the steep decline in all three teams was caused by the effects of a merger with a larger pharmaceutical company, announced just after the fifth iteration of the questionnaire had been administered. As is often the case in mergers, team members expressed concern for their jobs and positions within the smaller firm with which they were associated. This provided support for the notion that the metrics were reflecting the impact of "real world" events.13

Figure 7. Effects of Mergers on Teams.

KEEPING A TEAM ON TRACK

A corporate leadership team, which had consistently improved over four iterations, had a noticeable fall-off in the fifth iteration GTPQ results. At a team meeting, a facilitator helped the team discuss the issues that had the most marked negative responses and the biggest drop from the previous iteration (see Figure 8). The team was then able to identify common themes - direction, ownership, deployment, communication and cooperation - which they were then able to weave into the strategic planning discussions held throughout the remainder of their off-site meeting. The example in Figure 8, of a specific question from the GTPQ, was but one question of a total of 28. However, the aggregated team results showed the same fall-off in human process effectiveness for this team. Again, this illustrates both the kind of results obtained as well as how the information can be used to quickly check performance declines.

Figure 8. A Specific Question from the GTPQ.

CONCLUSION

Process and outputs are inextricably linked on teams.14 Future research will indicate whether human process measures can forecast productivity changes or whether these factors are correlated in other ways. In either case, metrics that allow managers to drill down to specific problems with processes on teams will allow interventions in the most timely and efficient manner, and thus improve or maintain superior team performance.

Similarly, when aggregating and comparing collective measurements from many teams, for example as part of digital dashboards, managers will be able to look at both process changes on individual teams as well as cumulative data for departments and divisions.

This will lead to improvements at the individual team level, as well as cumulative changes across teams as a way of determining management performances. This represents an alternative to reorganizing departments or companies without pre- and post-data in the hope that such changes will improve financial performance. Large scale change is not always beneficial, although it is sometimes necessary for strategic business purposes. Knowing the difference between change for its own sake and change for a specific set of objectives may save companies both time and money and increase shareholder value.

ENDNOTES

1 Hofstede, Geert. "Business Cultures" in UNESCO Courier, April 1994, V. 47, p. 12.
2 Asherman, Ira; Bing, John W., and Laroche, Lionel, "Building Trust Across Cultural Boundaries" originally published in Regulatory Affairs Forum and available online here.
3 The metrics approach used in the cases illustrated in this article were provided through the Global Team Process Questionnaire™, created and utilized by ITAP International.
4 The Hofstede cultural data has been taken from Geert Hofstede, Culture's Consequences: Comparing Values, Behaviors, Institutions and Organizations across Nations, Second Edition. Sage Publications, 2001.
5 Hofstede, page 79.
6 Jones, Steve, and Moffett, Richard G., "Measurement and Feedback Systems for Teams," in Sundstrom, Eric, and Associates, Supporting Work Team Effectiveness: Best Management Practices for Fostering High Performance. Page. 157. Jossey-Bass: 1999.
7 Jones and Moffett, op. cit., p. 159.
8 Quoted in Mathieu, John E, and Day, David V., "Assessing Processes within and Between Organizational Teams: A Nuclear Power Plant Example," in Brannick, Michael T., Salas, Eduardo, and Prince, Carolyn (eds.),Team Performance Assessment and Measurement: Theory, Assessment, and Applications. Lawrence Erlbaum Associates, 1997.
9 Bing, John W. "Developing a Consulting Tool to Measure Process Change on Global Teams: The Global Team Process Questionnaire™" (Page 4), proceedings of the 2001 national conference of the Academy of Human Resource Development and available online here.
10 Bing, op.cit.
11 The dimensions were created based on literature research and factor analysis of questions responses.
12 The database is maintained by ITAP International and is the collection of responses from over 100 teams, many followed through multiple measurements.
13 Bing, op.cit., p. 7.
14 For other examples of the relationship of process and productivity of teams, see Bing, John W., "The Relationship between Process and Performance on Teams".

John Bing is the chairman of ITAP International, a consulting firm with operations in Europe, the U.S. and the Asia Pacific region. His consuiting experience spans the Americas, Europe and Africa and the pharmaceutical, consumer product, information technology industries and United Nations' Agencies. He is the designer of ITAP International's Team Process Questionnaire family of consulting instruments and is developing a new version of the Culture in the Workplace QuestionnaireTM, originally created by Geert Hofstede. He has published papers and provided presentations at numerous professional conferences including the American Society for Training and Development (ASTD) and the Academy for Human Resources Development and recently co-edited (with Darren C. Short) a volume entitled "Shaping the Future of HRD" in the Advances in Developing Human Resources series. Mr. Bing was a founding member of SIETAR (the Society for Intercultural Education, Training and Research). He is a member of the Research to Practice Committee of ASTD and is the recipient of ASTD's International Practitioner of the Year Award. A graduate of Harvard College, Bing received his Ed.D. from the Center for International Education, University of Massachusetts. He speaks Afghan Farsi and is an avid hiker whose goals include hiking to three of Colorado's 14,000-foot peaks each summer.

This article originally appeared in the International Association for Human Resource Information ManagementIHRIM Journal, November/December 2004, Vol. VIII, Number 6.

International Training Program Levels and Types

The programs offered to employees of international businesses today may be categorized according to their levels, or in terms of the tools utilized. Note that the cross-cultural training described in Levels II and III provides participants with a framework that enables them to deal with situations not covered directly in the training, whereas Level I training usually does not.

Level I

These programs offer the "Do’s and Don’ts" of international business, often mixing information about etiquette with advice on what types of business gifts to give and how to best form business relationships in other countries. They also may provide specific information about travel, banking, embassies, etc. These programs are most useful for employees with little or no international business experience. In the words of the old fable, these programs provide people with fish, rather than teaching them how to fish. At the end of these programs, participants have a good idea of how to conduct specific business transactions, but little idea how to generalize to other situations.

Level II

Level II programs teach participants how to fish; that is, they provide analytic tools which can be used to understand the relationship between culture and business. They do this by providing models of cultures based on research in the field of comparative sociology or anthropology. Participants learn to understand social and business transactions by applying these analytic tools, and are often tested through the use of critical incidents or case studies. At the end of these programs, participants are able to analyze general culture-based business transactions to determine how, in a specific culture, the business transaction might be different from the transaction in their own cultures.

Level III

At this level, specific information (typical of Level I) and analytic tools (provided in Level II) are brought to bear on:

1. Specific business problems or opportunities (such as sales or marketing, mergers or acquisitions) within the area of these employees’ professional scope
2. Assisting employees with relocation to other countries
3. Decision-making at upper levels (e.g., where to locate a new plant in a region)

At the end of these sessions, participants are able to apply the analytic tools and specific country, regional, and culture-based information to business problems in their areas of expertise.