Patrick Lencioni, the author of the bestselling management books The Five Dysfunctions of a Team and The Advantage, isn’t impressed with fancy technology or slick marketing. The founder of the Lafayette, Calif.-based consultancy The Table Group, he previously worked for Bain & Company and Oracle Corp. In his work with corporations, professional sports teams, militaries and other organizations, he’s come to believe that organizational health – which he defines as a workplace with little politics, low turnover among good people and high morale and productivity – differentiates businesses far more than any novel strategy.
Lencioni will be speaking at CEO Global Network’s GREAT CEOs Speaker Series (The Globe and Mail is media partner) in Mississauga, Ont. on September 26th. Ahead of the talk, The Globe spoke with him about the problem with data obsession, why culture isn’t “soft, squishy” stuff, and what team leaders can learn from the 2019 Toronto Raptors.
What sparked your interest in organizational health in the first place?
I spent years working for consultancies. Our focus was always on marketing and technology, and I always thought there was something missing. We would give them great intellectual advice, but often they couldn’t implement it because of interpersonal or organizational dysfunction. I remember thinking this was critical in order for all that intelligence to work. I realized if companies don’t figure this out, they’re going to waste time and money seeking intellectual solutions to problems that human beings can’t implement.
What, to you, does a healthy organization look like?
Take Southwest Airlines. Everybody – people at business school, media – wants to know the silver bullet that made it great. They really hope it’s a single decision around strategy or technology or market position or something intellectual. When in fact it’s the culture of the organization. It’s the way they get things done. That’s how they differentiate.
When I say culture, I’m not being touchy-feely. And that’s not a soft, squishy term. Culture is where operations, behaviour and strategy all meet. Companies that understand that have a huge competitive advantage.
Leaders today tend to be far more attuned to so-called “soft” things than ever before. Does that mean there are more companies understand the value of organizational health?
More and more. But plenty still have blind spots. They’re chasing business intelligence, But today, intelligence just isn’t enough, because every organization is pretty darned smart. With access to information and the ubiquity of the internet, it’s almost impossible to maintain a competitive advantage in any sort of intellectual endeavour.
Think about sports. When a team wins, everyone wants to say it’s because of an offence, or players, or strategy. But that’s not what makes teams win. Look at the Toronto Raptors this year: They were selfless, hard-working and really had great chemistry. It wasn’t one thing. It was really about culture. Interestingly, the Golden State Warriors, had traditionally always been pretty good at the culture stuff. But when they got Kevin Durant, that kind of hurt the culture. They got greedy. And it made it harder for them to work together. There were injuries, too, but even still, they weren’t working as well together as they had in the past.
Why do you think more leaders aren’t shifting their focus to organizational health?
It sounds compelling, and it is, but some executives can’t get into it because, first, they think it should be more sophisticated. People think “it can’t be this simple.” Well, it is.
Second, there’s an adrenalin bias. People want something they can implement tomorrow.
Third, a lot of leaders prioritize quantification. They want to know exactly how much their efforts will add to the bottom line. [Organizational health] doesn’t work that way. It’s so embedded in everything in the business, there is no way to adequately quantify it. It doesn’t happen overnight.
For leaders not used to measuring the health of their organizations, how do you recommend they start?
It starts with the leadership team at the top. That’s true if you’re running a small organization, or division of a company, or a huge corporation or a non-profit. You need to ask questions about your executive team. Do you think that your executive is completely open and trusting of one another? Are they vulnerable enough to admit mistakes? Do they apologize when they’re wrong, ask for help when they need it? Do they have good arguments without fear? Do they debate things in a rigorous way? Do they actually call each other out on poor performance and behaviours and hold themselves accountable? Are they collectively interested in the good of the team, or are they more concerned with their own division?
Then ask what we call six critical questions of each executive: Do you know why this organization exists? Why does it matter beyond making money? Do people really know what behaviours you won’t tolerate, and which are a must? Do you know what business you’re in, what makes you unique compared to your competitors? Do you really know what your No. 1 priority is right now? And do you know who has to do what to get it done? Look for whether your executives provide the same answers.
You can take the smartest company in the world: if the executive team isn’t cohesive, if they aren’t aligned, if they’re not communicating and putting structure into place, they’re not going to succeed. It happens all the time.
Even a relatively ordinary company, with ordinary levels of intelligence, if they can do those things they’ll get smarter and smarter over time.