Bankable Leadership: End the tyranny of policies and procedures

The following is the third excerpt from New York Times best-selling author and executive coach Dr. Tasha Eurich’s new book Bankable Leadership.  

When we board an airplane, we trust the pilot to be capable of getting us safely to our destination. When we go to the hospital, we trust our doctors to be competent to address our health problem. Why, then, don’t we trust our employees to be capable of making sound decisions in their jobs? Why do we bog them down with rules and boundaries?

Jim Collins discusses this in Good to Great. He found that when organizations hire mediocre people instead of getting rid of them, they create policies to mitigate the damage. Soon, these companies become bureaucracies and drive away their best people. They act as if employees can’t be trusted to deliver a good performance, so the employees don’t.

There are a few brave leaders and companies who have bucked the trend and eliminated policies in favor of clear expectations, reliance on their employees’ judgment, and the employment of clear consequences when good judgment isn’t used.

Many human resource professionals love creating policies. But Pat Lawrence isn’t just any human resources professional. When she started as the senior vice president of human resources at RE/MAX, the company had a seventy-page policy manual. Pat thought that sitting new employees down to tell them all the things they couldn’t do was neither welcoming nor helpful. Instead, Pat helps her leaders set clear expectations up front for what employees should do.

And slowly, over the course of seven years, Pat whittled away the RE/MAX policy manual. About five policies needed to be retained for regulatory reasons (the code of conduct, harassment and confidentiality rules, and so on), but the rest were out. As Nordstrom knows, it’s all about using your best judgment.

Is this a perfect solution that solves all HR difficulties? Of course not. “Sometimes employees make bad decisions,” Pat wisely observes. “But [our approach] is infinitely better than saying ‘We’ll terminate you if any of these five hundred things happen!’”

Courtney Harrison is another example of a Bankable Leader who helped her organization treat its employees like adults. As SVP of Organization and People Development at Asurion, a start-up technology protection company, Courtney championed the goal of treating employees like adults.

The most powerful transformation took place at the manufacturing centre where customer phones were repaired. When Courtney first met the center’s manager, Charlie, his turnover was high and morale was low. The centre also had the highest number of policies in the company, largely because of the fear that employees would steal customers’ phones.

Courtney started with a philosophical conversation. “Charlie, you’ll always have people stealing from you, but should you build your company around them or the 98 per cent of employees who don’t? If you do the latter, they’ll police each other. Instead of the parent-child dynamic, they’ll act responsibly. Wouldn’t that be so much easier?”

Charlie was hesitant at first, but the lightbulb went on as they discussed the center’s dress code. “Would you tell an adult you trust to work with your customers how to dress?” Courtney asked.

“No!” Charlie realized.

“Exactly,” said Courtney. “We don’t need a ten-page policy, we just need to set expectations and create consequences if people don’t follow them.” It was a revelation.

Charlie held a series of town halls to clarify those expectations. “I trust you,” he told employees, “but I might not have been acting like I did. We’re going to start fresh. One of the things I trust you to do is to get dressed in the morning.

Here’s what I expect. I want you to be covered from here”—he pointed to his shoulders—“to here”—he pointed to his knees. “Nothing with holes. Nothing religious or political. No flip-flops, midriff bearing, or belly shirts. If you’re not sure, go to the Gap and buy five long-sleeved T-shirts and five pairs of jeans!” The employees all laughed.

“Now,” Charlie went on, “if you come to work and seem confused about this, you get three chances. The first time, you’ll go home and change. The second time, you’ll be sent home without pay. The third time, you’re fired.” The team understood. Once he started trusting his employees, they started acting like adults. Clarifying your expectations, the big point of chapter 4, is a critical aspect of treating employees like adults. It would be delusional for an organization to abandon its policies but not give some idea of what is expected. When policies go away, employees have to be responsible for their behavior, and when they make bad choices, leaders must intervene immediately.

But I don’t control the policies at my company, you might be thinking. It’s not in my power to throw out the rulebook! That may be true, but you do influence how policies are used in your team. Let’s look at two policy-enforcement conversations:

Conversation 1: “Mary, thanks for coming to meet with me. When I walked by your office earlier, I noticed you were shopping on Amazon instead of taking customer calls. As you know, we have a policy against this. [Leader hands policy to employee.] I need you to follow it.”

Conversation 2: “Mary, thanks for coming to meet with me. When I walked by your office earlier, I noticed you were shopping on Amazon instead of taking customer calls. When you first joined our team, remember the conversation we had about the importance of answering our calls quickly? We also discussed my expectation that you only use the Internet for your personal use during your lunch break. I’m asking you not to do this again, and as you know, if you do, it will result in a day without pay.

“I trust you to make the right decision.”

Neither conversation is comfortable — Conversation 2 is probably harder. But practice shifting your perspective and put yourself in Mary’s shoes. Conversation 1 insults her intelligence. Conversation 2 treats her like an adult. Which one would you choose?

Look for more excerpts from Bankable Leadership on CDN in the coming weeks.

Dr. Tasha Eurich is a proud leadership geek, executive coach, speaker, and author, Dr. Eurich is the author of the new book, Bankable Leadership: Happy People, Bottom Line Results, and the Power to Deliver Both.  She also helps organizations succeed by improving the effectiveness of their leaders and teams.  Dr. Eurich passionately pairs her scientific grounding in human behavior with a practical approach to solving some of today’s most common leadership challenges. Her decade-long career has spanned roles as an external consultant and a direct report to both CEOs and human resources executives. The majority of Dr. Eurich’s work has been with executives in large Fortune 500 organizations, including CH2M HILL, Xcel Energy, Western Union, IHS, Destination Hotels and Resorts, Newmont Mining, Centura Health, CoBiz Financial, the City of Cincinnati, and HCA.

With an M.S. and Ph.D. in Industrial-Organizational Psychology from Colorado State University and B.A.s in Theater and Psychology from Middlebury College, she serves on the faculty at the Center for Creative Leadership. She has served as an adjunct faculty member in Colorado State University’s Psychology and Business Schools. She is also a popular guest speaker at the University of Denver and Colorado State University’s Executive MBA programs.

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