Jeppe Vilstrup Hansgaard
I am sure you know the reality TV show “Undercover Boss”. A CEO works in disguise alongside employees to reconnect with what is going on in the business. The CEO gets surprised about the reality in the company, and often decides to do whatever possible to change the reality in both the short- and long term.
Is “Undercover Boss” just a reality TV show – or does “Undercover Boss” display the unpleasant truth about how disconnected CEO’s are from what happens in their companies?
I am convinced of the latter, and I believe this is the golden opportunity for IC professionals to move the needle inside their companies.
Water Melons, Mum’s, and the illusion of the org chart
Firstly, let me share a few organizational insights with you that I believe will convince you of the same.
Water Melon cultures has become the norm. In a “Water Melon” culture the unpleasant truths are hidden from the CEO, as his/her reaction is feared. The messenger may be shoot for delivering bad news. Regretfully, the “Shoot-the-Messenger”-syndrome happens every day in businesses across the world. For the same reason, staff color all KPI’s green, so they look nice on the outside. Yet, if you cut through the surface, it is all a big mess, and should have been communicated as a red KPI.
Is the real organization running at risk?
If one person is removed from the network, then it disintegrates and a drop in performance and disconnect in communication is to be expected. In this case, the person had just signed her resignation.
The Mum-Effect keeps CEO’s away from the truth until something is really broken. I have five brothers. Every time we had made trouble – and we did it a bit too often… sorry mum - we either kept it as a secret for our mum, or made the trouble sound better. All to protect our mum from the reality! Bob Sutton, one of my favorite thinkers, argues that this happens in companies every day. He calls it the mum-effect. The impact of the mum-effect in organization is that bad news becomes a happier and happier story the closer it gets to the top of the organizational hierarchy. The result is clear… the CEO never hears about the trouble, until something is really broken! I have a personal example: my best friend and I managed to glue together a very old antique inherited glass which we had broken after playing soccer in the living room. My mum did not notice until six months later, where I had forgotten all about it…
The illusion of the org chart. The first action of a new CEO is often to build a new org chart, as it gives the illusion of being in control. In my humble opinion, the org chart has become irrelevant as a tool to steer work. In 2005, only 1/10 of staff primarily worked outside their own box in the org chart. Now, it is 9/10. For the same reason, peers have become more important than the immediate manager for most employees. Change happens at the water cooler, not at the town hall meeting or through top-down communication cascaded down in the organization.
Voice of People are identified across the organization. It is not enough for IC to find the most influential staff. It is more important to reach all corners of the organization, or in other words, to maximize organizational impact of the Voice of the People.
CEO’s are disconnected from the reality
CEO’s and other top executives are disconnected from the reality in the organizations they are supposed to lead and we have the data to back that statement.
Firstly, they do not know who drives the daily sense-making in the organizations.
Data show that sense-making is not equally distributed between all employees. We use peer-identification to diagnose how influence travels. The numbers should be intriguing to IC professionals, because 3% of employees influence 85% of their peers. We have even established that those 3% drive all perceptions. Unfortunately, CEO’s and other executives do not know the 3%.
Secondly, CEO’s never hear what is going on in the organization.
Is that a problem? – Yes, because that makes it impossible to drive successful change. If the organization cannot make sense of what the CEO is looking for to achieve – and if the CEO does not understand the reality faced by the organization, then change will never happen!
An example: the top executives had just launched a new strategy, so we asked the organization to describe the strategy with their own words. The evidence was clear. The top executives were all positive (they had spent nine months on defining the new strategy), and used words like innovation and growth to describe the strategy. At the bottom of the pyramid the words were all negative, like cost-cutting, layoffs, and cumbersome. Pushing a change forward, when there is such a disconnect in perception, is certainly a road to failure. Luckily, the executives decided to halt their change, and engage in sense-making conversations with their “voice of the people” group.
The real org chart displays how people are connected. A network view displays how people are connected. Lines display hidden organizational elements, like who do people go to for advice, who gives energy, who collaborates, who are accessible to whom. The figures display organizational attributes e.g. the color in this case displays departments, whereas the form shows hierarchical level. Simple network illustration of smaller organizations can be developed manually – see here: Internal Influencers. Medium and large organizations require tools & technology to establish.
Is this the golden opportunity for IC?
The direct connection between the top and the bottom of organizations must be re-established! I believe strongly that this is a golden opportunity for IC.
CEO’s and other executives need to expand their internal exposure and conversations to include vertical interactions with lower level employees. I do not see a better place to get this facilitated than in IC.
Specifically, I believe IC should take on the responsibility to:
Identify who drives the conversations at the water cooler
Connect the CEO’s to them
Make sure a disciplined mechanism is formed for trustful conversations with them, so they understand and embrace what is going on in the organization
Track the “voice of the people” on a continuous basis
Naturally, the CEO cannot talk to everybody in the company, and this is another critical element for IC to address. When people peer-identify who they engage with, they help you define the “voice of the people”. A small group of people, where you can focus your IC energy rather than a broad de-focused initiative. Much like Influencer Marketing!
Communication flows after series of acquisitions
A company had engaged in a series of acquisitions. The lines show communication flows. The colors show the different acquisitions. Observation. The companies are still not acting integrated, but the diagram indicates exactly who IC should work with (and who not to work with) to integrate them.
“It is not rocket science”
IC can do this in any company that value trust, honesty and transparency, and understand the value of IC. It is not rocket science.
Here are a couple of examples:
a biweekly brown bag was launched between the CEO and the 2-3 identified individuals driving the sense making in the organizations. This was facilitated by IC, who drove this as a core communication channel.
a CEO was travelling between his +20 locations. Rather than using his normal routine to talk to local management, he changed his routine, and he talked to the “voice of the people” first, then the managers, and lastly held a town-hall meeting, where he up-front addressed the issues he had learned about from the “voice of the people” and discussed with local management.
The issues faced by the “Undercover Boss” were addressed; even without disguise!
IC professionals, what are you waiting for?
The 3% is a rule, which Innovisor has proven over the last 10 years. It is saying: "What is the minimum number of the right people you should engage with, if you want to maximize your impact." We identify the exact point, where it does not make sense from an efficiency point of view to engage more people.
About the author
Jeppe Vilstrup Hansgaard is the CEO of Innovisor. He holds a master of business administration degree from Henley Business School and a certificate in strategic decision and risk management from Stanford School of Professional Development. To stay up-to-date on his thoughts on change management, collaboration, organizational networks and leadership follow Innovisor here on LinkedIn and on Twitter.
For more information on the topic of Internal Influencers: