We’ve all heard about Generation Y’s unprecedented skills in navigating through large amounts of information, combining virtual and live sources, and filtering against publicity.
Thousands of studies and parents will confirm how cable TV has taught Yers to flip through 500 channels faster than most people can absorb an image, how excessive advertisement has rendered them disinterested and how videogames have rewired their brain. Though there are tons of interesting consequences to this overexposure (on the positive and negative side), I’d like to share with you today the subtlest one: the link between organizational data indigestion and Yers’ engagement levels. To do so, let me illustrate it with the Tom’s story.
Tom is an energetic Yer and brilliant financial analyst, with a diploma from an Ivy League university. After a 2-year experience in another company, he joins a multinational organization and reports directly to the Business Unit Director. In very little time, his manager discovers Tom’s skills in cutting through large amounts of data and setting strategic priorities. He then asks Tom to head the BU’s reporting cycle (an activity responsible for 10% of his time).
Tom supports the idea, as participating in the reporting cycle would naturally feed him with enough information to play a big role in the yearly strategic planning. In the first months, Tom runs through a few frustrations running the cycle: the quality of input from his colleagues was below acceptable level and needed to be reworked, there was little alignment between BU and global reports, large amounts of data were merely copies from a report to another with very little automation, several KPIs were outdated or had an unclear calculation method, and output delays were often shorter than input’s due to constant calendar changes.
On the bright side, collecting and analyzing with patience this large amount of information allowed him to significantly improve strategic input and budget planning, which set his BU from the underperforming to an over-performing status the following year.
During his first and second year, Tom was passionate about this challenging part of his job. He explained to colleagues the importance of their contribution and trained the less-analytical ones on precise reporting, he renegotiated reporting calendar, he explained the strategic importance of KPI reduction and revision, automation of data collection and reporting alignment, both inside his market but also in direct contact with headquarters.
Despite his creative efforts, within 2 or 3 months after each boost, Tom would find himself with the same problems. Each month, headquarters pushed reporting revision down the priority list. When the economic crisis arrived, instead of decreasing, the number of reports increased (each company leader creating his own template in a technocratic effort to justify lower revenues).
The reporting days of each month became stress-filled and during those nights Tom would rarely sleep. He became increasingly aggressive towards his non-compliant colleagues and headquarters started to avoid him. He was tired of the continuous fight and felt conflicted between his will to do the right things and his organization’s sole focus on completing the task. Moreover, he didn’t see the meaning behind the company’s thousands of monthly man-hours spent in producing a reporting booklet several inches thick (filled with disconnected data that no one read). He expressed to his manager his discomfort with this intense micromanaging effort: a “we don’t trust you” message the board was sending to all employees.
10% of his job became the source of 90% of his stress. One fine day, Tom handed in his resignation.
Tom’s story is not uncommon these days.
The traditional “command and conquer” management style required that information be readily shared with the higher parts of the pyramid and until a couple of decades ago, this approach made perfect sense! We lived in a business environment where speed of information translated into speed to market and speed to market was all that mattered in a zero-sum environment.
During the last decade, ERP, SAP and other acronyms became a real fad. They were specifically developed to produce any imaginable data about supply and demand, cross-analyzed into dozens of criteria. After a 2-year installation project, information could become exponentially available and rigidly aligned.
At first, management was inebriated: they could categorize, sort and put everything into context. However, as data reached the threshold of their capability to consume it and market trends evolved, the organizations started to experience indigestion.
This indigestion we’re experiencing globally can be translated in 2 levels:
On a first level, it creates a parallel organization within the organization, one that doesn’t add any value. It’s a heavy machine (operated by thousands of employees) that regularly produces summaries, reports and summaries of reports, and multiplies managers’ meetings to present and consolidate data. This reporting cycle reduces the ability to react rather than increase it, because by the time the past-oriented data is fully understood it’s often too late to take action.
On a second level, it reduces engagement throughout the organization (and most significantly at entry-level positions held by Yers, that don’t see the benefit of the time spent in it). Just like in Tom’s story, reduced engagement breeds office aggression, lack of ownership, reporting errors and ultimately in high turnover rates. In turn, reporting errors cause managers to spend more time in meetings consolidating figures, which account for an increase in burn-out cases and a reinforced obsession for reporting precision. The figure below summarizes this frustrating vicious cycle.
Breaking the cycle is not an easy nor cheap task (but then again, neither was the installation of that all-mighty SAP you have now nor the fortune you spend every month on generating those reports). It is however vital for a company’s improvement of working relations and ultimate survival.
In my next post, I’ll go over some of the main steps in digesting all this information while keeping everyone in your company happy, healthy and engaged. In the meantime, I’d love to hear your ideas on the subject.
How would you turn this information indigestion into a happy meal?