Advertisement
The bike accident was a dramatic situation I could see developing. In business, sometimes we can see an impending crash before it happens. On the other hand, sometimes a situation seems to sneak up on us. It isn't dramatic, but we sense that something isn't going right. These problems are usually harder to solve. In this column, we'll discuss specific situations our firm faced, and what we learned when solving the problems.
WARNING CLOUDS
Our firm has 14 full-time employees and a number of part-timers, including college interns who work throughout the year. Over the years, we've hired a number of new full-time personnel. At this point, not all of them are still with us. Could we have avoided losing some of them? Were there "warning clouds" on the horizon we could have spotted that would have prevented the unhappy situation from developing in the first place? The answer is yes and no. Let's study two hires.
Hire No. 1. We advertised for a professional to work as an operations associate. The person we hired had substantial academic credentials, including a graduate degree in finance. He had worked for another planning firm and was on the way to obtaining his CFP designation certificate. "Mr. J" had an outstanding work ethic, an extremely professional demeanor and excellent people skills.
Hire No. 2. Another hire was a tax accountant, responsible for managing tax-return preparation, and internal and external accounting. We selected a CPA who had an engineering degree, substantial business experience and a polished appearance. "Ms. P" did not have professional tax-return experience, but we both agreed she would work hard to learn the nuances of tax-return preparation.
Within six months of hiring them, Mr. J and Ms. P were performing well below my expectations. Both of these situations developed over a period of time. What went wrong?
When an employee fails to perform, managers typically don't blame themselves. They find reasons to blame the employee: the employee doesn't understand the work, isn't motivated or driven to succeed, can't set priorities, is too passive when it comes to taking charge of problems, is insufficiently innovative or won't take instructions. Whatever the reason may be, it is the employee's fault.
Is this really the case? Sometimes yes, sometimes no.
PYGMALION LIVES ON
In Mr. J's case, as it is for many other employees, performance--good and bad--can be attributed to the manager. This is called the Pygmalion Effect, first described by Sterling J. Livingston in "Pygmalion in Management" (Harvard Business Review, September-October 1988). Livingston reported on research that found:
- Whatever managers expect of their subordinates and the way they treat them has a huge impact on their performance and career progress.
- Superior managers create high performance expectations, which subordinates then fulfill.
- Less effective managers fail to develop high expectations and consequently, subordinates underperform.
- Subordinates, more often than not, appear to do what they believe they're expected to do.
Further research shows a manager can create a relationship that sets up a perceived underperformer to fail, even with the best intentions of increasing performance or compliance. Jean-Francois Manzoni and Jean-Louis Barsoux call this the "Set-Up-to-Fail Syndrome" (Harvard Business Review, March-April 1988).
Here's how it happens. A boss thinks he or she has a weak employee and begins to be concerned about the perceived underperformance. Maybe the employee misses a deadline or submits a subpar piece of work. The boss takes what seems to be normal management action by focusing more time and attention on the employee's performance. The boss might require more approval on decisions or critique work or comments more intensely.
The additional supervision has the unintended effect of increasing the subordinate's lack of confidence and stress, which causes him or her to withdraw from work and the boss. The employee starts to doubt his or her own ability, and loses the motivation to take any action or make autonomous decisions. The boss sees the subordinate's withdrawal as proof of a poor performer. So what happens? The boss redoubles supervisory efforts, watching, questioning and double-checking everything. This downward spiral has predictable consequences.
Research in this area indicates that the syndrome results in increasingly poor performance by the subordinate, but other things can happen as well. It can drain the boss's emotional energy and create a facade between the boss and employee that "everything is fine." It can alienate team members, as subordinates often complain to their peers. Worse yet, subordinates of the perceived weak performers may suffer as well. The perceived weak performers may repeat their boss's bad management style by failing to recognize good results or by supervising their employees excessively.
BREAKING OUT IS HARD TO DO
The Pygmalion Effect occurred between Mr. J and me. Luckily, we were able to stop the pattern. Here's what we did.
- We recognized the pattern by having others assess the dynamics of the relationship. People who are not in the relationship can often see the behavior. I got feedback from other professionals in the firm and then hired an outside industrial psychologist to confirm their perceptions.
- I had several candid conversations with Mr. J and others on the management team to start to untangle the unhealthy dynamics.
- I identified the "over-control" activities I had put in place.
- I set up clear, specific and measurable goals to reduce over-control, and my emotional and managerial involvement in the situation.
- We are now identifying true areas of underperformance and working toward a common understanding of what might be causing the weak performance. This includes my management style as well as Mr. J's work style. This may also include resetting expectations and areas of responsibility.
- We are establishing goals that focus on improving skills in the areas of underperformance.
- We've established more frequent and open communication, using outside coaching and annual professional assessments.
Finally, I had to assess my personal biases against reality: Was Mr. J really as bad as I thought? The answer was no, it was just that my expectations were not correctly set in the first place. I expected too much too soon from this young professional, and my expectations were not in writing and clearly understood by all parties. Mr. J did have the right stuff, but he was almost lost due to the management mistakes I made.
RESULTS MAY VARY
The same patterns developed with Ms. P. In this situation, we got to a point where there was conflict between Ms. P and other members of the firm in terms of authority and delegation of job responsibilities. Predictably, my "circle of supervision" tightened, but in this case others felt my supervision should have been even tighter. We talked through the interpersonal dynamics and set up more specific goals.
The results, however, weren't as good as they were with Mr. J, with only marginal improvement in these categories after one full year on the job. Ultimately, Ms. P did not have the requisite technical skills. Her mistakes, coupled with a lack of follow-through and organization, were fatal flaws. The joint decision was for her to work in a different environment better suited to her skill level.
MANAGER'S TOOLBOX
Are these kinds of situations always faits acomplis? Maybe not, but most managers have their favorite in-crowd, as well as those who never seem to quite make the team. That may be human nature, but that characteristic shouldn't have a place in the manager's toolbox.
To prevent this outcome, you must regularly examine your own assumptions. You must have the fortitude to assess your personality and emotions as a root cause before placing all of the blame on others. Managing consistently is as important as setting up clear and specific expectations for any job.
In summary, resist the temptation to categorize employees in simplistic ways and continue to challenge your own assumptions about everyone you work with. This is a warning cloud for every manager. If you don't want employees and yourself to fall victim to the Pygmalion Effect and Set-Up-to-Fail Syndrome, be sensitive to personal biases, stay objective, ask for outside assessment if necessary and be ready to defuse the situation...or be prepared for the wheels to fall off.
Glenn G. Kautt, CFP, EA is a financial planning practitioner and president of The Monitor Group, a wealth management firm in McLean, Va. He can be reached at kautt@themonitorgroup.com.
(c) 2006 Financial Planning and SourceMedia, Inc. All Rights Reserved.
http://www.Financial-Planning.com http://www.sourcemedia.com
