How declining organizations get used to mediocrity

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Companies rarely collapse all at once. The collapse is often only the visible phase of a decline that started long before and developed insidiously. Like the famous frog that does not react when the temperature of the water in which it is placed rises, this slowness makes it more difficult to react: the signs of decline seem disparate and it is difficult to link them together to build a picture of danger. At the heart of this difficulty is the silence about the situation within the organization, and the tacit acceptance of mediocrity.

It is 9.35 AM and I am in Paris at the Gare de Lyon railways station, waiting for a colleague. Track A, where her train was supposed to arrive at 9:30, is empty. However, the billboard in front of me indicates “On time”. I’m thinking of taking a picture, but what would the point be? Obviously, for the SNCF train company, a train that is five minutes late is considered to be on time. When I talk about it around me, the explanations come out: “You’re quibbling, it’s not that serious”, “It’s just a display error”, or “Oh well, I didn’t notice!” Talking about it to an SNCF agent is simply exposing yourself to a look of incomprehension, or even a reaction of annoyance. What can he do after all? There is nothing anyone can do.

This is how organizations decline: they get used to mediocrity. A five minutes delay is not counted as a delay, and everyone thinks it is normal. An obvious malfunction doesn’t bother anyone in the organization anymore, not even the customers. Words no longer mean anything. The train is late because it could not be on time.

How does an organization get used to mediocrity? It’s a process. The more the decline advances, the less rational it becomes to try and compensate for dysfunctions. At first, a dysfunction is a shocking exception for all to see, and the organization expects it to be fixed. When the dysfunction gradually becomes the norm, the organization no longer expects anything. The social pressure is no longer there. Dysfunctions increase the energy consumption of the employees. The need to protect oneself leads to disengagement. The investment in the collective, i.e. the small, unmeasured effort that should be made to correct a dysfunction, and which is the source of value creation for the collective, becomes less and less justifiable. The wheel starts turning in the other direction: the system becomes energy-consuming, and everyone does what they can to conserve their own. Disengagement becomes systemic. Privately, many employees may be aware of what is going on, but collectively, silence is the order of the day, as the cost of speaking up increases. Silence and disengagement become the rational options, which obviously reinforces the downward spiral. Problems? It’s all down to bad luck! Bad market conditions! Our competitors have the same! No one stands up and says “But the emperor has no clothes”.

Duck Syndrome

The reaction of top management rarely consists in delving into the organizational reality to understand what is going on. Often, this is because it comprises of people who do not have a good understanding of the organization anyway. They see themselves as strategists in a world of slides and Excel spreadsheets, moving pawns around in boxes, and seeing the operational as subordinate. I remember this ExCom member of a company that was paralyzed by a failing information system telling me of his astonishment: “For us, it was a purely operational problem that did not concern the excom, which must deal with strategy.” Unable to grasp the organizational reality, management tends to take refuge in visionary and abstract speeches or, lately, societal speeches, trying to create an illusion. To paraphrase Vaclav Havel, management pretends to be in charge and employees pretend to believe in them, and everyone can survive at least until tomorrow. Tomorrow is another day. But of course, this escape contributes to the problems.

The life of the organization then becomes a kind of musical chair game where everyone tries to save his or her own skin: those who can slip through the cracks in the system, which are all the more numerous as the rules multiply. The pressure of reality falls on those who cannot pass the hot potato to others: assistants, who are generally the last to give up, and those who are in contact with customers or whose results are easily measurable: salespeople, or call center agents (that’s why they are put as far away from headquarters as possible), for instance. They are the last ones who feel the pressure. They are the ones who feel the hardest the discrepancy between the official speech of “Everything is going well” and the reality of the dysfunctions they cannot escape. The organization ends up looking like a duck on water: it appears calm and serene on the surface, but underneath it is pedaling like crazy.

The illusion of technical solutions for a systemic problem

When the decline starts to show up in the numbers, top management, which sees the organization as a machine, tends to resort to technical solutions. Structures are added, administrative staff is recruited, project management is reinforced, controls are multiplied, reorganization is carried out, a “super manager” is appointed for the superstructure, “saboteurs” are fired, etc. This makes the whole thing more cumbersome, increases energy consumption, and thus reinforces disengagement. The technocratic division into sub-problems entrusted to specialists prevents a systemic solution. Performance indicators are also developed and they too mask the systemic nature of the problem. Or rather, they do not point to any causality, which is normal, because they encourage a simplistic vision of a complex problem: “We are losing customers? Let’s impose an additional 10% target next year on our sales people!” Press button number C4, left box, and voila! We’re breaking the thermometer without trying to understand where the fever is coming from. The drift, which consists of always being able to find a few satisfactory indicators that we will put forward, does not take long to happen. Nothing is more easily manipulated than performance indicators by the technostructure. The divorce between what is measured and does not really count, and what really counts but cannot be measured, is growing, and the decline with it.

Telling the truth

There is obviously no easy solution to such a situation because nothing is more powerful than a habit, and the habit of mediocrity is no exception. But any solution requires a language of truth. The condition to stop a spiral of decline is to accept reality as it is, and speak openly about it, even if it hurts. In principle, it is the role of top management to make this possible, but if they don’t, it is up to the employees to do so. This is possible for those who, in spite of everything, remain committed to the organization and who will find the strength to do so peacefully and without feeling the need to attack anyone. Faced with a failing management, they are the organization’s last chance.