I arrived at my hotel in mid-afternoon. I quickly unpacked and drove through the downtown area to see where I’d be facilitating my class in the morning. I knew the closure of the client’s large plant had been a shock to this rural community, but I wasn’t prepared for what I saw in the town square.
For three square blocks, all I saw were boarded up storefronts. There were three open businesses surrounded by dozens of closed shops.
The plant’s closure – driven by a number of economic variables – caused the town to slowly expire. The loss of plant jobs meant families could not support local businesses, and the domino effect led to the consequences I observed.
No one intended to cause the community to shut down. It was a ten-year long unintended consequence of the decision to close the plant.
Such unanticipated and undesirable outcomes of decisions happen every day in organizations around the globe. They may not be as devastating as this plant closure was, but they undermine performance, engagement, customer service, and profits just the same.
One client implemented a system to encourage managers to have weekly one-on-one meetings with each of their direct reports. At the end of the fiscal year, those managers who conducted 90% of these weekly meetings received a $400 bonus. This approach was completely well-intended, yet it had unintended consequences.
During that year, employees reported being forced to attend one-on-one meetings with their managers. Employees had no part in the meeting agenda nor was their active participation or dialog a part of the one-on-ones. This feedback enabled the client to redirect the system to address these unintended consequences.
Weekly one-on-ones were expected of both managers and their direct reports. Where employees reported that these meetings enabled effective partnering with their managers, both parties got “credit.” At the end of the year, if 90% of the meetings were rated effective, both parties earned a $100 bonus.
Where there is any perceived unfairness of plans, decisions, and actions, unintended consequences may be in play. Does your organization have special parking for some staff, or a separate lunchroom, or extravagant pay for certain parties? These strongly contribute to perceptions of unfairness.
Another client found that compensation and reward practices were perceived as unfair. For example, sales staff received high commissions for completing transactions, yet those who actually created or delivered products and services received no additional compensation for their efforts. Sales staff also enjoyed reward trips to luxurious resorts when they exceeded their quotas, yet those responsible for products and service delivery were excluded from those trips.
The client redirected those unintended consequences by eliminating sales commissions. They spread those funds across the entire organization so everyone responsible for the organization’s success benefitted from it.
If you tolerate unfair policies and practices, you will “enjoy” the consequences: reduced employee engagement, lousy customer treatment, and reduced profits across your business.
You can only redirect unintended consequences if you are aware of them. Observe. Listen. Ask – then redirect.
Join in the conversation about this post/podcast in the comments section below. What unintended consequences exist in your organization? How have you seen leaders effectively mitigate unintended consequences in your work environment?
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