Must Reads-The Advantage: Organizational Health Provides Greatest Competitive Advantage

                Companies in every industry are always looking for an advantage – something that will  set them apart from competitors. But according to Patrick Lencioni, author of The Advantage: Why Organizational Health Trumps Everything Else in Business, competitive advantages from traditional areas, such as marketing, technology, finance or strategy, no longer exist because every company now has access to the best knowledge around these topics.

                The premise of the book is that organizational health is the single greatest advantage that any company can achieve, and that it remains largely untapped by most organizations.

                “The health of an organization provides the context for strategy, finance, marketing, technology, and everything else that happens within it, which is why it is the single greatest factor for determining an organization’s success,” Lencioni wrote. “More than talent. More than knowledge. More than innovation.”

                A healthy organization is one that has virtually eliminated politics and confusion from its environment, which causes productivity and morale to soar and retains good employees, commented Lencioni. But if it plays such a big role in helping organizations succeed, why don’t more companies focus on it? Lencioni believes that it is because many leaders think they are too sophisticated, busy or analytical to bother with it, or that it’s beneath them.

                The book describes four disciplines that Lencioni believes are essential for attaining organizational health and the actions that need to be taken.

                These key disciplines are:

                1. Build a Cohesive Leadership Team – As leaders go, so goes the company or organization. The first step involves getting the leaders to behave in a functional, cohesive way. Dysfunction has a way of cascading through an organization if those at the top are unhealthy.

                2. Create Clarity – Your top leadership needs to be clear on key topics, such as, why the organization exists, what is the highest priority for the coming months, etc. Leaders must eliminate any gaps that may exist between them, so that people one, two or three levels below have complete clarity about what should be done to be successful.

                3. Over-Communicate Clarity – The first two steps are critical to achieving the third step in the process. Leaders of a healthy organization constantly repeat themselves and reinforce what is true and important. This should be done at regular intervals and cannot be stressed enough.

                4. Reinforce Clarity – Finally, in addition to over-communicating, leaders must ensure that answers to critical questions about the company’s mission and success are reinforced repeatedly using simple human systems. This means that any process involving people, from hiring and firing to performance management and decision-making, is customized to intentionally support and reinforce the unique mission, goals and culture of the organization.

                Lencioni wrote, “In addition to these four steps, it is essential that a healthy organization get better at the one activity that underpins everything it does: meetings. Yes, meetings. Without making a few simple but fundamental changes to the way meetings happen, a healthy organization will struggle to maintain what it has worked hard to build.”

                He added that organizations need to create “so much clarity that there is as little room as possible for confusion, disorder and infighting to set in.”

                The author denounces company mission statements, writing that they are often full of generic buzzwords and aspirational phrases that do not give an accurate description of an organization or inspire its workers to change the world.

                Once the leadership team has agreed on answers to all the key questions, healthy organizations need to communicate the answers to employees over and over again. Understandably, many leaders may be hesitant to do this out of fear that they will just sound repetitive. But according to the book, leaders should always err on the side of saying too much, rather than too little.

                The conclusions in The Advantage are based on observations Lencioni made during 20 years as a business consultant. Because of this, he is able to include many real-life examples he has personally seen of the different concepts he presents. Almost every new idea is followed by one of these anecdotal stories, showing how Lencioni first came to understand a certain principle, what different principles look like in action, or the disadvantages that occur when an idea is not applied by an organization. This, along with the subtle humor injected throughout the book, make it useful and thought provoking for any business leader.

                For more information on the book or free resources designed to help you develop clarity in your organization, visit http://www.tablegroup.com/oh/

 

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DeAnna Stephens Baker

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Pallet Enterprise November 2024