Tomicide Solutions October 2007: Eleven Diseases Of High-Tech Business Development Departments

By Tom "Bald Dog" Varjan

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Do you know that all that the very first bomb, that the Allies dropped on Berlin in World War II, achieved was that it killed an elephant in the Berlin Zoo?

So, considering the huge earth-shattering effort, the impact was rather dismal. Of course, later the Allies figured out how be more effective and cause more damage with less efforts.

So, how does this relate to better managing high-tech business development departments?

There is no doubt that running a business development departments is not easy. You have to coordinate two drastically different types of people. You work with the technology folks who are involved in developing stuff and delivering projects and you work with the people who are engaged in selling the stuff the former groups has conjured up.

So, here are 11 points you may find valuable to bring out the best in your business development people.

1. Purpose Is Replaced By Quota

While it's vital for a company to make money, I also believe that money is the by-product of running a business on purpose. A company must have a bigger purpose and vision than making money to pay the bills and making payroll. When business development departments are managed by quotas, the purpose gets overlooked because now everyone is staring at the scoreboard to see how they're performing relative to the preset quota.

But staring at the scoreboard has a problem. Using boxing language, while you're staring and admire what you see, your opponent might just drive your nose into your brain and beat the shit out of you. And then the scoreboard will change rather drastically.

One more point here: The purpose is the cause and the accomplished quota is the effect.

And as quality guru, Philip Crosby once said...

"Building a better scale doesn't change your weight."

Meaning that we can't improve profitability simply by assigning higher quotas for salespeople. Profitability must be a company-wide undertaking, not something that is expected of a small group of people within the whole work force.

The reason why so many people die in the claws of Western style medicine is because it manages the effect and leaves the cause alone. When we understand that it's operating on purpose and serving the mission of the organisation that create the quota we see in the books, then we have a better chance of pulling it off and exceeding quota. But it's short-sighted to focus on the quota itself.

2. The Business Development Is A Bunch Of Silos

Look at most high-tech companies and you discover these silos.

Silo #1: Marketing folks do the marketing stuff. These folks are too busy working on fancy slogans and images for... hell knows what, so they have neither time nor inclination to generate leads for the sales folks and are not too keen on creating materials that sales folks can actually use.

Silo #2: Sales folks do the sales stuff. They are roaming the land, trying to hunt down some people with need and money who are willing to put in a few hours of "arse time" to sit through some dog and pony show presentations.

Silo #3: Receptionists receive the first call from prospective clients. Most of them have no idea how to handle the situation. Remember, now these receptionists must be in "sales mode" not in "receptionist mode."

Silo #4: Client service folks do the client service stuff. They stay in touch with clients and relay their desires, requests, wishes and demands to the project team who are working on project implementation.

Silo #5: Project teams do the project stuff.

Each of these silos does its work in total isolation from the other silos. There is only vertical communication / reporting to the next oversight level in the pecking order.

Why is this a problem? In aviation the highest level of accidents happen during take-off and landing. The chance of accidents goes further up during staff changeover in the tower. Let's say, traffic controller Joan is bringing in a plane. During the descent, John, the pilot has informed Joan about all the intricate details about the plane and the people situation. All the little details. Halfway down, Joan's shift ends and here comes the new controller, Jill. Joan briefs Jill on all the obvious details, but lots of important stuff gets lost in the cracks, including the fact that the plane's front tyre, due to a little leak, has slightly lower pressure than needed, so the plane will need the one and only extra long runway to land safely. And now Jill is bringing in the plane on one of the normal runways, running a high risk of an accident.

Of course, I've just made this up. All I know about aeroplanes is how to jump out of them. The rest is the masterpiece of my deranged imagination. But I hope it demonstrates what can happen between shifts. This is what happens between individual silos in high-tech companies. And while not many people die in the process, qualified sales leads get lost, paying clients get ignored and projects run over time and budget.

It's vital that all the involved departments work together as one smooth continuum, so prospects and clients don't notice when they get passed from one department to the next. That's why when you design the whole client generation and fulfilment continuum, you have to involve all the departments.

3. Hiring New Staff Through HR Or Outside Agencies

Business development is knowledge work. What that means is that flashy and glitzy resumes are meaningless. If we consider that in any village with more than five residents, there is at least one professional resume writer. So, think about it again. People come in two educational forms...

1. Credential collectors: These people attend various courses in order to collect enough certificates to impress the HR folks. The problem is that the best courses don't issue certificates. I've studied with some of the best and most practical sales and marketing folks in North America or even on the planet, including Jay Abraham Michael Gerber Dan Kennedy, Jay Conrad Levinson, and many more, and they don't issue certificates. So, from the HR perspective I'm totally incompetent and unqualified for business development work. Despite the fact that I've been hired by companies where the resident MBAs couldn't produce results.

2. Practitioners: These people are in the frontlines, so they want to learn real stuff. For them credentials are not important. They go for up-to-date knowledge. And these are the folks who have a hard time with agencies and HR departments. They have real knowledge, but since HR and most agencies don't understand business development, they form their judgement of these professionals based on their formal credentials. But these are the folks you really need. The mavericks and underdogs. Or as the advertising legend David Ogilvy once put it...

"Our business needs a massive transfusion of talent, and talent, I believe, is most likely to be found among non-conformists, dissenters and rebels."

Why organisations are obsessed with the traditional suit-and-tie, play-by-the-book, paint-within-the-lines business graduates which North American colleges and universities spit out every 1.67 minutes (I've actually calculated this based on some statistics). MBAs alone are produced at just over 100,000 per year. What strikes me is that in their desperate attempts to become different from the crowd, most high-tech companies hire breathtakingly similar people... straight out of the very crowd they want to differentiate themselves from.

Oh, and if you find this a tad too extreme, then read some Henry Mintzberg stuff on, what he calls, the "MBA Menace." That will make your head spin.

As a business development director or VP of business development, you're expected to produce results with your team. Well, hell, then you might as well select your team and not to accept whomever an agency or HR throws at you. The HR folks are there to help people to settle in, but the right of hiring people should be taken away from them. And the agencies? Well, give me a break. Forget about them.

Companies are great at pontificating that people are their most important assets, but when it comes to acquiring these important assets, most companies are so disinterested that they just farm it out to agencies. That's rather moronic. Why do they do that? Well, because the appropriate executives are too busy fiddling with minor issues that they don't have time to acquire the company's most important assets. Amazing.

4. Emphasising Short-Term Profits

Businesses are run in quarterly cycles. So, many high-tech businesses focus on maximising quarterly earnings. While the pressure is bad enough in private companies to produce quarterly results, Wall Street's pressure on public companies is a real disaster. So what do many companies do to boost quarterly profits? They eliminate professional development and marketing. Professional development and marketing cost money. Hiring an army of salespeople on straight commission costs nothing. Besides salespeople in most high-tech companies are regarded as expendable grunts, so companies don't even pay attention to the almost 50% annual attrition.

It reminds me of a scene from the movie Braveheart at the battle of Falkirk...

King Longshank: "Bring in the archers."
General: "Sir, aren't we going to hit our own soldiers?"
King Longshank: "Yes, but we hit theirs too."

Most high-tech companies are willing to make any amount of human sacrifice, undermining their brands and reputation, to meet short-term financial goals, even if this short-term improvement can lead to these companies' demise.

This why salespeople are instructed to rush to close deals as quickly as possible, so the deal can be added to this quarter's earnings, even if the project starts or the products are shipped in the next quarter. And in this rush the quality gets compromised, so quite often the next quarter starts with client complaints, project cancellations or product returns. But that's a new quarter. The current quarter has been carefully padded for overall satisfaction, so the CEO can justifiably pose on the cover of Fortune or other business magazines.

But now there is long-term prosperity of the company. And if every effort is concentrated on the making of the quick buck, then no one is really concerned with long-term success. And this causes a bit of a clash here. High-tech companies extensively use investors to stay alive. Some of these investors want instant return on their money, whereas some, the Warren Buffett-calibre geniuses, are looking for long-term sustained earnings. And one group has to give in. And in many cases the "quick buck" group wins.

5. Rewards And Performance Tracking

Here we can talk a bit about compensation systems.

Commission

Offering commission payment is a call for disaster because your people's only incentive is to sell more whatever it takes. And to do so even by backstabbing their own colleagues. Thus, there is no teamwork. And more often than not quick sales undermine relationships both with clients and colleagues.

Your income depends a bit on your performance but it's largely defined by management that decides how you do your work and you have no say in it. Many years ago I suggested my boss that we could generate more and better sales leads through direct mail more easily than cold calling. He threw me out of his office and gave me the Yellow Pages, "Keep dialling. When you're done, start all over."

So, while my income was dependent on how much I was selling, he made the sales process as hard as he could through his ignorance.

And where does the commission structure lead to? To situations like this...

Falls Church Lt. Paul Lucas said the department works to meet a number of goals listed in its annual budget, including a projected number of traffic tickets. For fiscal year 1984, the department will try to issue 551 drunk driving tickets, 2592 speeding tickets and 3476 other traffic tickets, Lucas said. From the Virginia Weekly, Washington Post, 12 April 1984, p. 1. (Quoted from Out of the Crisis by W. Edwards Deming)

There is the quota, and it's adjusted according to the company's sales projection. But projections, to a certain extent, are speculations.

Yes, we can track the performance (effect), but we definitely must track the precursors and conditions (causes) to high-performance. So, if you want to lose weight, don't track how much you weigh on a daily basis, but track your eating and exercise programme. And the condition of every good engagement must start with a good relationship based on mutual trust, respect and peer level credibility.

Hourly Wages

Hourly compensation creates an environment in which the longer you prolong the problem, the more you get paid. This is where Parkinson's Law applies so well, "Work expands to fill the time allotted for it." And since there is no time allotted, many professionals keep going to do basic work which may or may not contribute to end results but creates extra billable hours. And here are some other issues with hourly rates...

Besides, there is no correlation between spending time and creating value using knowledge. It's not the time that counts but what your people pack into their time. And that comes down to excitementm, ambition and enthusiasm.

Timesheets

When you ask people to interrupt their work every six minutes to report on their activities, then you're asking for a disaster.

A while ago I was workinig with an engineering firm on this timesheet elimination issue. The managing partner has bought into the timesheet-less concept but he was concerned about the other people's reaction.

Before we went into the room to meet the troops, I asked him to make a note on each person's comments regarding timesheets. Then we went in and I asked associates to express their views for or against timesheets and tracking effort and time. I've always known that most people are fear- and scarcity-driven, but this experience was amazing.

The main reason why the rebels rebelled against the elimination of timesheets is because they fear that they may do some work and, since they can't account for the time and effort, they wouldn't get paid for that activity. To me this was strange because they were on annual salaries plus bonuses, depending how the firm as a whole was doing.

When the groups session ended, the managing partner and I sat down and I asked the partner to evaluate each associates' performance. What emerged was profound but not exactly surprising. There was a direct correlation between loving timesheets and low performance. Peak performers were jumping with joy at the notion of eliminating timesheets. The no-hopers insisted on keeping timesheets.

The partner looked at me rather surprised. Then it hit me...Holy sausage, man! Dr. Mihaly Csikszentmihalyi and his "Flow" concept. This is how Csikszentmihalyi defines the state of Flow...

"Being completely involved in an activity for its own sake. The ego falls away. Time flies. Every action, movement, and thought follows inevitably from the previous one, like playing jazz. Your whole being is involved, and you're using your skills to the utmost."

Can you imagine to interrupt "Flow work" every 6 minutes to fill in your time sheet and account for the activity you've just performed? How do you account for "thinking." No timesheet-minded manager will buy into the concept that you actually think. You're there as a circus monkey to perform pre-defined tasks and document them. If Newton, Einstein and other great inventors had been forced to account for their time, we would still be living in caves.

Now let's look at the Flow diagram and see what's happening here...

  1. Low skill low challenge -> Leading to apathy

  2. High skill low challenge -> Leading to boredom

  3. Low skill high challenge -> Leading to anxiety, stress, fear

  4. High skill high challenge -> Leading to peak performance, called "Flow"
Dr. Mihaly Csikszentmihalyi's Flow model

And rest assured even the most excited and enthusiastic people lose their drive when you constantly police them about accounting for their activities.

Who are the people who insist on keeping timesheets? People in the Apathy and Boredom areas. David Maister calls these people cruisers and losers.

And who are the people who hate timesheet? Yes, the people who operate in the Flow. David rightfully calls them dynamos. They are the people who have excellence in their DNA's and do their best work every time they touch something because they learnt this behaviour from their parents. They don't need timesheets and micromanaging. They are naturally conscientious in their work, and are proud and inspired to do great work.

And what about the anxiety part: In my experience, this area is shared between dynamos as they're stepping up to the next level of performance but haven't yet mastered all the newly needed skills, and cruisers and losers who are anxious about being found out.

Back to this partner. When he realised how much time and effort it takes to "manage" low performers, after assessing their contribution to the firm, he decided to offer them a better opportunity somewhere else.

Then I asked him what had blinded him to these people's poor performance so far. He said: The timesheet.

I think they exerted large amount of effort to cover up their low performance. So, here it is again. Get rid of internal time tracking for your people, and you automatically weed out the ones who you can do without, without any negative effects.

And the timesheet-less culture will attract more people who like working in the "Flow." And who are the people who like operating in the "Flow?" They are the real talents. These are the people who were born to do what they do. Let them do it, and let them bring joy and profit to your clients and your firm.

Regarding delivering value to clients, how can a high-tech company sell and track value outwards, while tracking time chunks and efforts inwards?

6. The Dreaded Annual Performance Review

Just as there is a world of difference between education (self-discovery and self-exploration) and training (preparing for and taking tests), there is a world of difference between peak performance and spending a whole year to look good at the annual performance review.

In a recent interview, the Brazilian soccer legend, Pele has been asked about British soccer genius, David Beckham. Pele's said that David was no longer a player but a celebrity. He's bathing in his celebrity status and the wealth that comes with it and no longer has the time to be a real player.

How does this apply to most managers? They are too busy being bosses and emphasise their power over their people and no longer have time to be coaches and mentors to their people. They have become brilliant at demanding results but pathetically hopeless at helping their people to improve their results.

So, people learn the rules of the game and instead of focusing on improving their work, they focus on passing the annual performance review with flying colours. And the two are not the same.

In his book, A Different Kind of teacher, John Taylor Gatto writes about a young guy...

"I'm 25, I don't know how to do anything except passing tests."

Translation...

"I don't know how to do anything except how to score perfect 10 on my annual performance evaluation without actually performing at that level."

I've recently talked to someone who is a co-ordinator at a government-sponsored self-employment programme (What an oxymoron). After taking these courses, some 75% of participants, instead of starting their own businesses, get a job and live the rest of their lives as employees, just as they did before.

To my surprise the co-ordinator said, "Tom, as long as we dispense 140 hours of classroom tutelage and prove that every participant wrote a document entitled "business plan," we are blazingly successful regardless of the actual failure rate or how many of our clients end up on the streets begging for alms for the rest of their lives."

Yes, in terms of dispensed time units and poundage of deliverables these courses are nipplepiercingly successful. In terms of results... well, that's another story. But we all know that when working for the government, accountability takes a brand new meaning.

The problem is that this scoreboard approach causes short-term spikes in performance, but it can never create year-around high performance...

What is so sad here is that it focuses on assessing the current performance level people have achieved, while ignoring the process of helping people to get better in their areas of expertise. And instead of helping people to become great in areas where they are already very good - strengths, it focuses on correcting people's weaknesses, also called, areas of improvement: "I see you're an amazing diagnostician, but now let's focus on how you can become a better proposal writer and shoe shiner." This is retarded. But in Western society we have a natural infatuation with improving people's weaknesses. Why? Hell knows. The best thing you can do is to bury yourself in Marcus Buckingham's books and learn a new way of looking at this strength weakness thing.

7. Systematisable Work Done Manually

When I'm calculating something complex, the first time I punch it into a calculator. But the second time I create a template in a spreadsheet. And this is what business development folks ought to do. Whatever can be systematised must be systematised, so there is more time and human capacity to interact with paying clients who require the attention of a real person.

There are so many things in business development that can be automated and systematised. Yet, so many high-tech firms use manual labour to do work that can be easily automated.

8. Rewarding Individualism Over Teamwork

Many high-tech companies are so obsessed with high-tech, often only for high-tech's sake, that they ignore the human element of performance. So, since they don't want to invest the time, effort and money to create an environment that promotes teamwork, they settle with an individualistic culture and set up individual performance measures like brain-dead quotas or retarded working hours.

If managers really know that teams can achieve more than the sum their members' individual performance, then what's the logic in tracking individual team members' performance and encourage them to operate independently?

9. Lack Of Structured Education Path For All Your People

Every member of the business development team must be on a documented continuing professional development path. And I believe this should include both work-related and non-related development. I believe in Gabriele Veneziano's theory of quantum physics...

"Everything is connected with everything else."

For instance, client service people need empathy and patience. So for this role I prefer people who own pets and/or regularly garden. They have empathy and patience. So, I would send dog owners and their dogs to dog training school. And I would send the gardeners to learn more about gardening. As they learn, they deepen their empathy and patience, which significantly improve them as client service people.

The biggest problem with most professional development programmes is that they create trade barbarians. Programmers take more courses on programming. Salespeople take more sales training programmes. But instead of learning from the best, they take courses at their local colleges.

I believe in a corporate educational centre, which is really a sort of library of books, CDs, DVDs and other materials. So, instead of taking courses with some local, but unknown "experts," your people can learn from the best of the industry.

I have several friends who've taken sales courses offered by local experts and colleges, but have never heard of some of the best sales pioneers of the 21st century like Jill Konrath, Jeff Thull or Jacques Werth. Or some of the best lead generation folks like Brian Carroll, Russel Kern or M. H. "Mac" Mcintosh.

I can speak only for Vancouver where I live, but I can confidently say that a couple of books and some free white papers and webcasts far outweigh what the whole city has to offer in terms of sales and marketing.

There is one snag though. Local colleges and "approved" institutions, despite doling out obsolete sales and marketing stuff, offer fancy certificates, and most people are not in search of knowledge but in search of new credentials. Why? Because their retarded bosses believe that the more certificates they have on the wall, they are certain signs of improvement. And retarded HR people hire people based on fancy certificates.

So, business development people join various programmes to collect certificates. But my questions is, as Alan Weiss puts it in his book, Million Dollar Consulting...

"Who certifies the certifiers?"

My take on this may be somewhat cynical, but it's already panned out in a number of areas I've looked at. So...

Point #1: People who really know the stuff, do the stuff. Good salespeople sell.

Point #2: People who don't know the stuff well enough to do it, teach it. Bad salespeople teach selling skills in local colleges.

Point #3: People who are hopelessly incompetent at the stuff, form associations and certifying bodies to regulate the profession which they themselves don't fully understand. People who don't have a the faintest idea how to sell themselves out of a piss-soaked paper bag, regulate the profession and issue certificates for people who decide to waste their time and money on their courses.

Don't get me wrong. There are great associations that are for the members, like the fitness association (BCRPA) here in British Columbia, but most associations are about money grabbing to provide a good lifestyle for the founding moochers.

In my view it's just an indication of more "arse-time" people have taken to sit and cram codified information and regurgitate them at their instructors' satisfaction. Now you can accuse me of being a John Taylor Gatto disciple and being overdosed on his stuff, and you're right. But I also say that sales and marketing knowledge shouldn't be learnt in classrooms but in the trenches. And definitely not from academic theorists but from people who actually practise it.

The car sales guy, Joe Girrard is regarded as one of the greatest salespeople who's ever lived. Is he certified? Not really. Neither are some of the best marketing people, like Jay Abraham or Dan Kennedy. We either pursue knowledge or papers.

A friend of mine has recently completed an Internet marketing course at one of the local universities. Great. Now he's got a nicely framed certificate on the wall. For a fraction of his tuition he could have bought some packaged knowledge from some of the greatest Internet marketing - real - experts (as opposed to college professors) and could have attended some of the best Internet marketing seminars and conferences.

But those programmes don't issue certificates. Now he's certified. The problem is that by the way universities work, by the time the material he learnt had become curriculum, it had also become obsolete. Hm. So, I suggest you go for knowledge not certificate. And if your HR people try to interfere, keep them out of your department... even by brute force if necessary. Before they start giving you people with spiffy resumes but empty heads.

10. Internal Individual Ranking Of People

This is really bad. Walk into most sales managers' offices and what you see on the wall is the individual accomplishments of each salesperson. The chart looks like a racetrack and the objective is to have one winner. The sales manager needs one winner to win the main prize of the sales contest, and he doesn't really care about the number of "losers." In some of the greatest shithole companies, you can perform really well, but if you slip up once on your quota and you're fired.

I believe people should only be ranked against their own performance. This way people are competing against their previous selves and not against their own colleagues.

And here is one more thing. If we assume that people's performance is a reflection of the environment they operate in, then instead of wasting energy on ranking the people, it makes more sense to rank the environment as to how it measures up to the ideal environment in which people can operate at their peak potential.

11. Operating The Business Only On Tangible Indicators

Business development is the function of knowledge workers. What that means is that these people are not production workers performing manual labour at a conveyor belts at a steady pace. Knowledge workers use their brains and unique talents and skills to produce better results.

And one more differentiating factor between brawn workers and brainworkers. In the case of brawn workers, it's their employers who own the means, that is, tools, of production. I can be the world's best gravedigger (and once upon a time I was a pretty good one), but without the tools provided by my employer, I can't work and can't demonstrate how good I am. I need the company if I want to work.

As a brainworker, all your tools are in your head. Peter Drucker pointed out this huge shift many years ago by saying...

"In the knowledge society, the most probable assumption for organizations-and certainly the assumption on which they have to conduct their affairs-is that they need knowledge workers far more than knowledge workers need them."

Knowledge workers are like investors in search of good companies where they can invest their knowledge for a good both economic and psychological return. Yes, this includes money, but also includes being treated with respect and dignity. Sadly, most high-tech organisations still treat their people as brawn workers by setting rigid working hours, tracking their times in a task-based environments.

The funny (or sad) thing is that retail giant Best Buy has managed to build a results only environment (R.O.W.E.) in which people work as freely as one can imagine. And interestingly, ever since management loosened up control, performance and profitability have been going up. Hm.

So, what is more important for high-tech companies? Having control over people at mediocre performance or loosening control and increasing performance?

Besides there is a problem with control as Nicole Kidman explained to Tom Cruise in the movie Days of Thunder...

"Control is an illusion, you infantile egomaniac. Nobody controls anything."

Or as Clarence Francis put it...

"You can buy a man's time, you can buy a man's physical presence at a certain place, you can even buy a measured number of skilled muscular motions per hour or day. But you cannot buy enthusiasm, you cannot buy initiative, you cannot buy loyalty; you cannot buy the devotion of hearts, minds, and souls. You have to earn these things."

So, the key is not control and the erroneous notion that you can run a company on tangible indicators. Remember, tangible indicators (effects) are created by intangible human idiosyncrasies (causes). By the time you see the tangible indicators, it's far too late.

So What Causes These Fiendish Diseases?

In the 1960s, MIT Sloan School of Management professor, Douglas McGregor developed a theory that has been used in organisational behaviour ever since. He created two approaches to motivate people. One of them was...

Theory X

Theory X assumes that people are inherently lazy and do their best to lie, avoid work and cheat the system. What this means is that if we want to get performance out of people, we have to closely monitor and police them. And if we notice any drop of performance, then we have to cajole, whip, threaten them to so they can improve.

According to Theory X, people try to do as little work as humanly possible to qualify for their paycheques because their only interest is money. Theory X managers are constantly looking for scapegoats in case something goes wrong. They know they can't trust their own people, so they implement rigid policies and procedures to mould people for better performance. Theory X managers know that they suppress morale and inspiration, so they try to compensate for the lost performance with threats and coercion.

Theory X managers manage in an autocratic style and use sophisticated punishment systems to get performance out of their people. Because of its oppressive nature, Theory X work environments are like a car that is zooming down the highway in second gear and the handbrake halfway on. It does make some minor progress, but the system is overheating, the engine smokes like a steam engine, and the brake pads are burning. All in all, even this pathetic performance can't be maintained for long, and the people burn out.

In total contrast to Theory X, there is...

Theory Y...

Theory Y assumes that people are inherently creative, inspired to do great work and flourish in a collegial, collaborative environment. So, if this is the case, we have to put people into an environments that brings out the best in them, but not by management's pushing them forward but by big bold goals' pulling them forward. Theory Y people have something more than money to work for. They have aspirations and dreams of becoming the best they can.

Theory Y managers improve themselves and the environment, so they provide better circumstances for the people to work in. They're exemplars not a preachers. They preach only what they are willing to practise. For Theory Y people the ultimate job satisfaction comes from within the work itself. Theory Y managers know that the secret to higher productivity lies within people, and with good coaching and mentoring they can bring it out in them.

Unlike Theory X managers who use policies and procedures, Theory Y managers use culture, values and a Code of Honour to help their people to keep themselves to the straight and narrow.

While Theory X managers manage the whole group, Theory Y managers know that real management is about helping people on a 1-to-1 basis, so they build 1-to-1 relationships with their people.

Time Line Illustration Of Destroyers Of Innate Virtues

  • Schooling and school grading

  • Compensation based on schooling or individual performance

  • Pigeonholing based on certificates, race, gender, social status, etc.

  • Managing by financial performance

  • Fear-mongering

  • Suspicion, duplicity, scepticism and cynicism
McGregor's Theory X and Theory Y

So, year by year and bit by bit, most of the "Y factors" are either killed off totally or reduced to insignificance, and, as a result of careful societal "tweaking" the "X factors" start getting stronger and stronger. Soon, curiosity is replaced by scepticism and collaboration by competition. Then the joyride on life's exciting highways becomes a rat race in the dark alleyways of a different kind life from paycheque to paycheque and from one prize to the next.

And whether management creates a Theory X or Theory Y environment depends on how the managers were brought up. During basic training in the army, I had a brilliant unit commander. He demanded a lot but he never yelled at anyone. Guess what? Later I became the same with my people. I never yelled. I had quiet demands and expectations. And people lived up to them. The other unit commander was a yeller. And most of his people became yellers.

So, I suggest that before we start dealing with our people, first we look in the mirror and deal with ourselves to make certain that we're more in the Y-range and less in the X-range.


Attribution: "This article was written by Tom "Bald Dog" Varjan who helps privately held information technology companies to develop high leverage client acquisition systems and business development teams in order to sell their products and services to premium clients at premium fees and prices. Visit Tom's website at http://www.varjan.com.