The Guv’nor: time to change the breakfast menu
They say culture and relationships eat strategy and process for breakfast. But why do we continue to pit them against one another as if they aren’t two sides of the same coin? In the second instalment of his new governance column, Bob Thust asks why they can’t all sit down over dinner and work it out
We live in an increasingly systemised world driven by technology and ever larger organisations looking for efficiency. For all the cost cutting and risk management, as a result we are losing sight of the power of human relationships and organisational culture. Whilst I’m delighted more attention is being paid to these themes, I’m also worried: there is a tendency to pit the transactional and the relational, the cultural and the strategic, against each other as if these are opposing forces that somehow need balancing. What we need to do is stop and examine how both these approaches, well, relate to each other.
It’s a familiar story. Organisations grow without focussed attention to strategy (or, in particular, the process and systems which support that strategy). Instead they rely on organisational culture and the strength of their relationships. These after all have seen them through many a tough time. But leaning on them has taken its toll. Without strong financial reporting and transparent recruitment and pay, disquiet has begun. They lurch from one crisis to another, each time straining the very relationships and chipping away at the very trust they have always relied upon.
Without any mechanism for accountability, the organisational culture they were so proud of has become the CEO’s excuse not to change their own toxic behaviour. All of this is harming their potential impact and growth, but it is also resulting in staff feeling undervalued and overworked, lessening their commitment to the organisation’s mission and values, increasing the potential for poor customer service and ultimately storing up problems until something has gone much more horribly wrong.
Here come the KPIs
Enter a funder, board member or consultant who patronisingly deems to know better and forcibly recommends the introduction of a new strategic framework with target KPIs, new reporting structures, new systems and processes in order to ‘get a handle on all this and professionalise things’. They reach for the best practice guides and standard toolkits. They purchase off-the-shelf systems which no-one really understands. They copy and paste policies without a second thought. They hire consultants to force everyone to apply them. They impose strict hierarchy and delegations, so every decision has to go through a multitude of layers of approval before it actually happens.
This erodes their culture and has an impact on their relationships even faster than an over-reliance on them. It takes away individual judgement and accountability for decisions, removes creativity, the ability to respond to what’s happening, the give and take required to sustain any relationship.
The professionals and boards are happy though. Costs have been reduced and they have a nice new strategy document and risk register to show for it too. Not to worry that most of those costs have likely just been pushed down the chain onto those they are supposedly there to support. Nor that as a result they are alienating or excluding often more marginalised communities.
This isn’t just a small issue. It’s through relationships that trust is more usually developed, that genuine collaboration can take place, that innovation becomes possible. It’s through dialogue that we often learn the most about what’s working, what’s not and what to do about it. More importantly, it really, really matters for those committed to social justice not the bottom line, for any redistribution of power or share of voice.
Powerful forces at play
This may seem an extreme example, but unfortunately so many organisations I’ve worked with and for have followed this path – from small social enterprises, to larger foundations and charities. It may not quick but it’s often a slow and steady march. After all, there are powerful forces at play here. People take comfort in set strategy and process because it can protect them from having to confront their fears or justify their decisions; they can make our lives easier in the face of hard targets and a lack of sufficient resources; if those in authority have set things up a certain way and everyone else is following the process then we very rarely feel able to question it.
So if a reliance on culture and relationships is an issue, and a reliance on strategy and process is an issue, where does that leave us?
It’s tempting to conclude that what we need in the social sector is some kind of ‘balance’ between the two. That analysis for me is at the heart of the problem. What we really need to do is understand the interaction and dependencies between them. It seems fairly obvious that culture will drive how likely people are to follow a process or commit to a strategy, and that any process or strategy over time contributes to defining culture for good or ill. That relationships grow when people are given freedom to use their judgement, but that they also thrive when supported by enabling processes that ensure transparency and protect accountability. If this is obvious, and it really ought to be, then why aren’t more organisations able to apply that in practice?
When organisations do, the way they work results in something like this:
1. They recognise that relying on trusted relationships and organisational culture alone is not enough.
The Kids Company scandal that rocked civil society is perhaps a case in point. And as someone said to me recently, “I’m sure Sepp Blatter was surrounded by relationships of mutual trust”. Well, quite.
2. They reflect carefully on what kind of organisation they are and what kind of relationships they want to have.
They start here because otherwise they know they will quickly end up with something that (maybe) worked for others, not for them. We often say organisations need to ‘live their values’. But, unless values are used as the starting point for making hard choices about strategy, and unless all of your processes and systems are designed specifically to support and enable them, they are nothing more than meaningless words on a wall.
3. They allow people the opportunity to exercise their judgement.
They build in flex to their strategies for the unexpected and unplanned. They delegate authority as far down as possible and at as high a level as possible, and ensure they have the systems to provide decision-makers with the information they need to do this well. If the process isn’t being followed, they find out why rather than come down hard.
4. Finally, and perhaps most importantly they review their strategies, policies and procedures regularly.
Not just on paper at a Board meeting, but by asking people that have to follow them. And when they do review, they continue to ask good questions: are our strategies and process enabling the kind of culture and relationships we want to have? Are they still providing the right information and mechanisms to ensure we are held to account, most especially by those we exist to support?
As I argued in my last column, governance needs to be in constant development, adapting as organisations grow or external circumstances change. Doing that isn’t easy when conditions of funding often focus purely on the strategy and process; when most governance support is for one-off ‘big bang’ exercises rather than funding core costs over a sustained period of time; where everyone wants to peddle their definitive guide, flowchart or toolkit; where we tend to value ‘lean’ organisations rather than effective ones.
But it really is possible if you stand firm and make your case to funders, if you take your time, if you embed this kind of reflection into the day-to-day conversations and meetings you have. For me, this is how we create effective, resilient and responsive approaches to governance and management. Where strategy and process become enabling rather than constraining, where positives cultures and relationships can thrive without becoming toxic or unaccountable.
Unchecked, my experience is quite different from the conventional wisdom: strategy and process is eating culture and relationships – and not just for breakfast, but for lunch too. However, reliance on a strong culture and trusted relationships alone is no cure either. Rather than pitching one against the other, let’s get them all around the table for dinner to work it out.
Bob Thust is co-founder of Practical Governance, trustee of Local Trust and treasurer at the Bevy community-led pub in East Brighton. It the next two columns he’ll be exploring the issue raised here and in his first column by looking at some ‘warts and all’ examples from those that have tried to do things differently from the norm. If you’ve got anything you’d like to share, any of your own examples, or any other comments you’d like to make – positive or otherwise – he’d like to hear from you. Email email@example.com or tweet at @practigov @BobThust #theguvnor
This feature was first published in Pioneers Post Quarterly issue 11 and will be made available to non-subscribers for a limited time only. Subscribe now here.
Image credit: Guy Downes, officeguycartoons.com