It’s quite common for organizational leaders to become so busy they don’t have time to think through their next organizational change. 

We interview employees and customers of our clients’ organization and often hear how hard and how much everyone is working, but at the same time, no real change is being accomplished. Something is not right when you put these two insights together. 

After decades of organizational research, we have discovered it is the unintentional things that have the most significant impact on how well an organization can change, and what makes it so difficult for them. By understanding the areas of dysfunctions, as Patrick Lencioni calls them, this will help your organization avoid this problem in the future.

Reason 1: Projects become more important than people. Once an organization has established a pattern for managing projects, it can easily slide into the internal mindset that projects are more important than the people carrying them out. This occurs in a particularly rigid organization where authority is deemed far more important than fresh new ideas. This authoritative mindset tends to diminish or even crush new thoughts to maintain expected company-line thinking. Over time this stamps out the ease at which an organization can contemplate change, let alone make one.

Reason 2: New products and services are regularly added, but older ones are not discontinued. While consulting an institute of a major university, we discovered they had 75 program offerings, but only 15% made up 85% of their revenues. With a more in-depth program audit, we also found that one-third of the programs had not been used in over three years! With this data, it was evident to us they should select the popular programs and discontinue the rest, but this took a good amount of convincing before they could take what they called drastic steps.

Reason 3: Programs are rewarded solely on their merits. As long as ‘their group’ is doing well, there is no incentive to care about the rest of the organization. As a former boss of mine once told me, “You usually receive the behavior you reward.” A compensation program that is based upon the efforts of their particular group sounds fair on the surface. However, when you analyze it from 30,000 feet, you recognize this encourages the organization to break up into hardened silos that don’t want to work with the other parts of the organization. 

Senior executives have to be courageous when looking at their organization and make tough decisions about what to add and delete. Many leaders prefer to not “Rock the boat” and take a safe, non-confrontational path. These leaders are those that most often experience organizational growth issues because they are forever falling behind other organizations that are more spirited and creative in their decision-making.