Is the devil outside or inside the organisation?

In my last job during the time between 2014 and 2016, the company performance was well below the mark, with 2016 being a serious disaster.

In early 2014, I shifted from CFO (Chief Financial Officer) role to COO (Chief Operating Officer) with the responsibility of sales, marketing and strategy. In this one job, I struggled more than any in my life.

But it was also at this time that I learned the most. I moved out of my COO job in early 2016 to attend the Harvard Business School's Advanced Management Programme course and spent some time in the head office in Malaysia before taking over the CEO role.

In my absence, the leadership at the time grabbed the opportunity to pass on the responsibility of the company's failure to me to save their face. As a result, confidence in me at the group management was shaken to the extent that I was almost being pushed for a much less important CEO role.

Avoiding the responsibility of failure or rather 'passing the buck' is very common in our leadership culture. Our first instinct is to pass the blame to an external factor which one cannot control. And if that is not possible, then all efforts are focused on finding a scapegoat within the organisation.

In the above event of failure, I consistently advised my boss that instead of playing the role of a sensible player, we, as a challenger company, should play aggressively. But he was of the view that sensible play is critical to managing profitability.

My view was that driving top-line growth with strong cost control helps grow profitability in a smarter way. During my tenure as the CEO in an extremely competitive industry, my first strategy was not to give any space to the market leader in terms of price and at the same time aggressively attack the Number Three player in the market as a weaker opponent. And voila! The strategy worked like magic!

In any given organisation, a crisis can ensue from a combination of processes: 1. An undercurrent accumulation of organisational inadequacies that lay in wait for a favourable situation to the surface; 2. A trend of growing ignorance that keeps managers visionless of the presence of these inadequacies; and 3. the leadership's blaming culture or refusal to accept the failure as an impediment to the growth journey.

The key point here is to understand how the imperfections within the organisation are allowed to build up and grow to a point when they become vulnerabilities. It happens because the imperfections or vulnerabilities are not taken into consideration until they lead to a crisis.

In other words, the management kind of lapses into a denial mode even when the vulnerabilities are all too clear. This managerial ignorance is described as a self-nourishing retreat, a process that inculcates the devil in the organisation.

We have all seen how corporate leaders, politicians etc. blame external factors for their failure.

For example, many leaders give the excuse that the 2021 target could not be achieved due to the pandemic or intense competition in the market or change in consumer behaviour or poor economic condition of the country and so on. Such leaders never try to look at the problem inside him/her or their own organisation, or knowingly deny the truth. This is how such leaders dig their own graves!

I believe we have all experienced it closely to some extent, both inside and outside of the job. During the pandemic, we took a changed strategy for the company which was primarily to focus on cost as against revenue.

While the coronavirus was out of our control, the cost is something that we could control while revenue was highly dependent on lockdowns, economic activities and their subsequent implications on revenue became something that we could at least control.

In order to deal with the devil within the organisation, first, we need to throw out the devil from inside us. As a matter of process, always start with blaming yourself or your organisation for the failure, which will help you identify the areas for improvement.

If you blame others or external factors and if they act on your blame, then they will improve. But if you blame yourself, then it is you who improves. If such a process is followed repeatedly, the devil will be outside the organisation permanently!

The author is a telecom and management expert