Cultivate a Healthy Business Culture for your Small Business
By: Connie Blaszczyk, Managing Editor, Resource Center
What does it take to build a healthy business culture for your small business?
For an informed answer, we sought out an expert — writer Patrick Lencioni.
As author of many bestselling books, including The Five Dysfunctions of a Team, Lencioni has consulted thousands of organizations on how to generate successful productivity, including Fortune 500 corporations, professional sports teams and others.
In this interview, we asked Lencioni for his insights – to which he added his four disciplines for generating organizational health.
Monster: Your latest book, The Advantage, emphasizes the importance of organizational health — and its impact on business culture. Has the recession impacted the health of many companies?
Lencioni: I think the recession has highlighted the issue in some ways. In tight economic times, companies cannot throw money at people to keep them happy and they cannot afford to overinvest in any one area of the business.
Addressing the health of an organization provides an opportunity to conduct business in a new way — one that maximizes human potential and aligns the organization around a common set of principles.
Using The Advantage does not cost organizations money — just time and commitment.
Monster: What are the signs of an unhealthy organization?
Monster: Is organizational health essentially the same for large and small companies?
Lencioni: Yes, the tenet s for organizational health are the same regardless of industry, location and company size. We have seen companies of all kinds transform themselves by addressing health.
The advantage smaller organizations have is they tend to be nimbler and can make actionable changes faster.
Monster: How can smaller companies with fewer resources and personnel practice it effectively?
Lencioni: Mastering the four disciplines of organizational health does not require dedicated resources or personnel.
For organizational health to be effective, the leaders of the organization must be fully committed to the principles and set aside the time required to create and sustain a healthy organization.
Monster: What are four disciplines? How does the process work?
Lencioni: An organization doesn’t become healthy in a linear, tidy fashion. Like building a strong marriage or family, it’s a messy process that involves doing a few things at once, and it must be maintained on an ongoing basis in order to be preserved. Still, that messy process can be broken down into four simple steps or disciplines:
1. Build a Cohesive Leadership Team The first is all about getting the leaders of the organization to behave in a functional, cohesive way. If the people responsible for running an organization, whether that organization is a corporation, a department within that corporation, a start-up company, a restaurant, a school or a church, are behaving in dysfunctional ways, then that dysfunction will cascade into the rest of the organization and prevent organizational health. And yes, there are concrete steps a leadership team can take to prevent this.
2. Create Clarity The second step for building a healthy organization is ensuring that the members of that leadership team are intellectually aligned around six simple but critical questions [see these below].
On topics ranging from: why the organization exists to what its most important priority is for the next few months, leaders must eliminate any gaps that may exist between them, so that people one, two or three levels below have complete clarity about what they should do to make the organization successful.
3. Over-Communicate Clarity Only after these first two steps are in process (behavioral and intellectual alignment) can an organization undertake the third step: over-communicating the answers to the six questions.
Leaders of a healthy organization constantly and I mean constantly repeat themselves and reinforce what is true and important. They always err on the side of saying too much, rather than too little. This quality alone sets leaders of healthy organizations apart from others.
4. Reinforce Clarity Finally, in addition to over-communicating, leaders must ensure that the answers to the six critical questions are reinforced repeatedly using simple human systems.
That means any process that involves people, from hiring and firing to performance management and decision-making, is designed in a custom way to intentionally support and emphasize the uniqueness of the organization.
Monster: What role does the CEO play in creating a healthy business environment?
Lencioni: I believe the single biggest factor in determining whether an organization is going to get healthier — or not — is the genuine commitment and active involvement of the person in charge.
For a company, that’s the CEO. For a small business, it’s the owner. For a school it’s the principal, and so on.
Monster: Some CEOs or bosses promote conflict among their leadership team, believing that it generates organizational health. What are the ground rules to healthy conflict?
Lencioni: Healthy conflict is centered around ideas, not people or personalities. Healthy organizations encourage ideological conflict, which is the willingness to disagree, even passionately, around important issues and decisions.
Monster: What distinguishes healthy workplace conflict from unhealthy conflict — in any size business?
Lencioni: We want our teams to be engaged in all the constructive conflict they can possibly have, without the conflict becoming destructive or interpersonal. This balance is impossible to get right every time. Teams must learn how to occasionally cross the line and manage it positively.
Monster: Small businesses are often run by one person. Can they benefit from practicing some of the principles of team leadership? If so, how?
Lencioni: Yes, certain aspects of the model can help an individual proprietor. In particular, the six critical questions will help a business owner get clear about why he/she is in business, what business success looks like, and how to go about doing it.
The six critical questions are:
- Why do we exist? The answer to this question will yield a core purpose, or the fundamental reason the company is in business.
- How do we behave? This question examines behaviors and values required for success.
- What do we do? This answer provides a simple, direct explanation of the business.
- How will we succeed? This question requires the team members to develop a strategy.
- What is most important, right now? The answer to this question is the establishment of a unifying thematic goal and action plan.
- Who must do what? This question addresses roles and responsibilities.
Read more from Patrick Lencioni: A Prescription to Increase Productivity and Employee Morale
Patrick Lencioni is a best-selling author, speaker and consultant with over two decades of experience working with CEOs and their executive teams. His most recent book is The Advantage: Why Organizational Health Trumps Everything Else In Business (Wiley, 2012).
He is founder and president of The Table Group, a consulting firm dedicated to building healthy organizations. He is the author of many best-selling books including The Five Dysfunctions of a Team, which continues to be a weekly fixture on national bestseller lists; his books have sold over three million copies.
Pat's work has been featured in numerous publications such as Bloomberg BusinessWeek, Fast Company, INC Magazine, USA Today, Fortune, Drucker Foundation' Leader to Leader, and Harvard Business Review.
The Wall Street Journal has named Lencioni one of the most in-demand business speakers. And he has been a keynote speaker on the same ticket with George Bush Sr., Jack Welch, Rudy Guiliani, Bill Clinton, and General Colin Powell.