The Leaders Vault

Leading at Light Speed is a must-have leadership book by Eric Douglas highlighting the 10 Quantum Leaps to build trust, spark innovation, and create a high-performing organization.

On pages 24-26 of Chapter One, Align the Core Values, Eric talks about Using Core Values ot Decentralize Decisions.

In practical terms, one of the greatest benefits of creating a framework of core values is that decision making can be decentralized. When the core values are understood by team members, the need for top-down command and control is moot. As an alternative, one can implement "values-based decision making.” {The result is extraordinary levels of innovation and performance~{"Extraordinary levels of innovation and performance were the result}~The results were extraordinary levels of innovation and performance~The end-product was incredibly high levels of innovation and team performance}.

Higher levels of innovation and creativity among the immediate results of decentralized decision making. One of the first things Herb Kelleher and his management team at Southwest Airlines sought was to reduce the turnaround time for aircraft on the ground. They set a goal of fifteen minutes. In the end, it was reduced to ten. Kelleher describes watching in awe as the maintenance supervisors and frontline employees came up with innovation after innovation to meet what was seen as an impossible standard. How did they do it? A culture of decentralized decision making and performance had already been implemented by Southwest. Southwest's basic standards were, in fact, the exception to the rule in other companies.

When a values-based decision making process is in place, the tension between centralization and decentralization begins to disappear. One California state agency, for example, articulated a set of values and tied them to performance measures. The return? With the need for centralized intervention lessened, more and more innovative and entrepreneurial ideas bloomed.

When core values are missing, there is a greater chance for bureaucracy and centralization to take over. One state agency insisted on a uniform hardware and software platform for every single employee, despite the obvious differences in end users’ needs. Customers complained that the agency wasn’t able to perform. Further internal tensions were increased as a "black market" emerged to address the problem. Lacking an explicit framework, the de facto values continued to reign, with the press for uniformity trumping employee innovation, trust, and satisfaction.

One of the most powerful arguments for this first quantum leap is linking core values and decentralized decision making. Successful leaders should strive to instill a culture of values-based decision making throughout their organizations. When they do, the results can be extraordinarys can be extraordinary, when this happens}.

What are the remnants of out-dated thinking that may be dispensed with as you align the core values. Ask yourself whether the following systems need to be retooled to make them consistent with your organization’s core values:

• Reporting systems – the organizational structure and hierarchy
• Executive perks
• Hiring practices and systems
• Training systems
• Compensation systems
• Performance review systems
• Internal communication systems
• Information technology systems
• Rules on information access and disclosure

Jim Collins tells the following story that serves as a good example of realignment. CEO Ken Iverson took the reigns of Nucor, a manufacturer of steel products, in 1986. He inherited a stodgy corporate culture characterized by hostile relationships between management and rank and  file. Executives enjoyed considerable perks. At this time, executive priority was determined by club memberships and access to the company executive dining room.

Iverson turned the culture around by doing three things:

1. He did away with titles
2. He did away with hierarchies
3. He did away with all executive perks

Until Iverson, Nucor appeared destined for oblivion. Under Iverson’s tenure, Nucor changed its values, changed its structure, and changed its culture. One of the hallmarks of a high-performing organization is the disintegration of the "we" versus "them" mentality. A complete shift in business focus and an immense level of success was his achievement. Nucor and its trade unions negotiated a highly successful profit-sharing arrangement. Rather than fear foreign competition, Nucor embraced it. Nucor's performance over a fifteen-year period was absolutely amazing, when compared with that of one of its chief rivals, Bethlehem Steel. It increased its share value more than twenty times that of Bethlehem Steel.

Here is the main point: Once the core values are defined, time is necessary to bring the organization into compliance. That’s okay. Achieving light speed takes time.

Take this free work survey to discover how well your company measures up to the 10 Quantum Leaps. Mark your progress with a timeline by signing up for a free account.

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