A senior executive of a company told me that they would have to outsource some functional elements of their organization overseas. He said their company was under substantial pressure from stockholders to perform better and one of the solutions was to outsource a major functional element of their business to an off-shore organization that could do it at less than half the cost. If someone offers to do something at less than half the price of what it currently costs you and assures the quality will not suffer, then you are compelled to do it- or your competitor will.

Let’s look at this problem a bit differently from the traditional “don’t ship our jobs overseas” viewpoint. If this company implemented only 50% of the changes they talked about instead of just the 10% they implemented over the past five years, they would be profitable and this conversation would not have taken place. Furthermore, they refused to hold executives and managers accountable for completing projects. Worse yet, they never had the nerve to hold tough- but necessary- conversations with personnel while the writing was on the wall.

In our consulting work we focus on behavior because that is usually the biggest problem in most organizations. It’s not the technology. It’s not the product. It’s the behavior. We don’t prescribe pills (systems)- we prescribe change in behavior which requires effort - conscientious effort.

The fear is that change is confrontational and it is going to tick people off. Managers don’t like to tick their people off- they like to be liked. But it doesn’t have to be confrontational. It can be influenced- just like in sales. You don’t sell someone, you get them to buy. Make them think it is their decision- or at least they are a part of the decision. At least explain the dramatics of the inevitable if people don’t buck up and get to work. But management doesn’t think this way- they are worried about being liked, so they can’t even see influencing change as an option. When it comes to making necessary change, managers stick their head in the sand and ignore the elephant in the room.

How could this overseas dilemma have been prevented at our client? Here’s an amazing observation: The reason most companies have to lay off people, close departments, divest divisions, and outsource work is they are afraid to confront employees and managers to get work done to begin with. This is astonishing- the willingness to fear short term pain under the guise that the problem will go away on its own someday- “when the economy turns around”.

It’s as though you know you are going to be late on shipping something to a customer, but you don’t say anything about it to the customer. It’s not like they aren’t going to find out. Too many people think choices are between a good thing and a bad thing. This is a false belief and poor management thinking. The choices we face are often not between a good thing and a bad thing, but between a bad thing and a worse thing. It’s a bad thing to tell the customer you are going to be late on a shipment- it’s a worse thing to let the customer find out on their own when you miss the shipping deadline.

The same applies for confronting people in the workplace about putting in some effort when the competitive writing is on the wall. It’s bad to confront them, but it is far worse to close the department or factory.

I cannot tell you how many times – with this client in particular- we advised them to do A and don’t do B- and they did B. Why? Because A required them to confront people to make change, while B was to continue the status quo and not do something that might “upset” the person(s) required to make the change. Train wrecks are so painful to watch, especially when there are many, many careers are on that train.

For a case study on how companies can create workplace cultures that can compete, be profitable, and not have to ship jobs overseas, see the case study article on FADAL Engineering.