In our consulting work, clients often ask us about the most frequent reason why improvement projects fail. The response is always the same: “A few managers will resist any form of change and will block any improvement initiative. If the boss doesn’t support us and help us push through the resistance, we will fail.”
All the training in the world will not convince people who are afraid to take risks. And that’s really the reason for resistance — fear of change. Fear of losing some power in the organization. Fear of no longer being indispensable.
In most cases, if the boss pushes hard and shows strong commitment to the new direction, most managers will follow. But a few will resist — either actively or passively, with the same result.
In those cases, the boss needs to prove his commitment to the improvement project by firing one or two managers. It serves as example for other less-than-enthusiastic members of staff. In China this is called “strangling the chicken in order to frighten the monkey”…
But many factory owners are reluctant to fire bad managers, even if they dislike them on a personal level. Their thought process is as follows: “If I fire him, I’ll have to pay him X months of salary and he will be happy. He will win this game.”
However, this is really not the right perspective. Here are the 2 options (I will assume the manager in question has been working for the factory for 3 years):
- Firing him/her. Cost to the factory: 3 months of salary. Positive impact: removing an obstacle to companywide improvement (i.e. often millions of USD in extra net margin).
- Keeping him/her. Cost to the factory: full salary on an ongoing basis, for an output of only 10-30% (since that manager is not contributing in a very positive manner).
So, how to fire those “bad apples”?
The solution is to set specific and measurable objectives, to put pressure for reaching those objectives, and to give warnings to embarrass low performers. Some of them will leave on their own. And yes, some will wait for the severance pay. It is better to push them out.
At the same time, pick open minded people among the operators, team leaders, and supervisors. Train them and coach them. Have them lead improvement projects and “grow into the role”. These will be your best managers in the long run.
What do you think?
I agree with your point: “people” is the “key factor” in a improvement project,
However, I am afraid that I could not agree with your one explanation that boss does not fire “bad managers” is only due to “Dismissal compensation”.
Firstly, Western people focus on “contract”, so usually consider thing from contract level. However, Chinese people focus on “relation (GUANXI in Chinese)”, so usually consider things from relation level.
Secondly, as a boss, his main task is to maintain factory’s smooth operation (here, he need a stable team). Besides, yes, he can try something new to streamline his operation (for better operation efficiency). However, boss (human being) is always put a big “question mark” for new thing (which mean uncertainty), especially many “substandard” consulting companies “damage” the consulting industry’s reputation. Then, though boss use “external brain”, he does not want to break the current “relationship” with some key managers, especially if they are labeled as “technical expert, loyal employee, and so on”. External team maybe leave boss on one day, however, these internal employees will stand with boss together.
So, I would rather consider the boss’s mindset as the biggest obstacle (root reason), especially in some SMEs. However, when some companies grow bigger and bigger, at that time, my guess is that boss’s mindset will have to go close to “change” by introducing the strong external consulting team since these labeled “technical expert” and “loyal employee” become less weight in his company (the cost of losing these become very few) and boss’s company’s structure cost is too high(he have to change!).
Thanks Philip for adding to the article.
The most common concern factory owners raise is the severance pay. But I agree with you, there are many other things at play. And keeping a harmony in the company through a stable top management team is seen as quite important (rightly so). Still, there are times where we can see that a manager is far from indispensable and is hurting the company in a strong way.
And yes, I fully agree with your conclusion!