The Announcements Fallacy

How well are new policies and procedures embraced in your organization? If you’re like most companies, it all depends on how well – and how quickly – those new expectations are embedded as practices.

It doesn’t matter what the change is – it could be a new software system or a new purpose statement; what matters is what happens after the change is announced. Yet most leaders operate under the faulty assumption that telling people what is expected ensures alignment to the change.

This fallacy is known as “managing by announcements,” a virus-like plague that I call “MbA.” When infected with the MbA virus, leaders do a good job of defining purpose or policies or procedures. They then publish and announce the details – and expect that all employees will immediately embrace the new expectations.

Leaders believe, “We’ve told them what to do. Now they’ll do it.”

Defining and announcing the new expectations is the easy part! To ensure that desired changes take hold, leaders must spend time and energy to ensure people modify their behavior, adapt their approaches, and demonstrate the new requirements.

To build credibility for the desired changes, leaders must LIVE the new requirements – right out of the gate. They must model the changes, coach the changes, praise progress as others embrace the changes, redirect players who are not embracing the changes, etc. It’s called “holding everyone accountable.”

Yet we see indications of the MbA plague all the time.

Here’s a recent example. A multi-billion dollar company has their business principles and standards crisply defined and widely available. Their standards include:

• Our clients’ interests always come first.
• Integrity and honesty are at the heart of our business.
• We take great pride in the professional quality of our work.
• To breach a confidence or use confidential information improperly or carelessly would be unthinkable.

Their list of standards is extensive. Reading the full list, I believe you’ll be satisfied that this company has clearly defined what a good job looks like in their organization.

This problem? There was little accountability for these standards and practices. This came clear when in July 2010 the US Securities and Exchange Commission announced that this company, Goldman Sachs, agreed to pay a record $550 million fine to settle charges that the company misled investors in a subprime mortgage product just as the US housing market began to collapse.

Soon after, the company put a new business standards committee into place to emphasize collective accountability for demonstrating the company’s business principles and standards. At this point, the jury is still out.

How can leaders immunize themselves against the plague of MbA? Follow the prescription noted above – live the new requirements in every interaction. Model the new rules, coach the new rules, and hold people accountable for the new rules.

How healthy is your team or company’s culture? Don’t guess – get the data with my online Culture Effectiveness Assessment.

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