Thursday, August 21, 2008

Guidelines for executive teamwork.

Once it’s clear how people are connected up and what individual areas of decision making remain, then it’s time to work out some behavioral guidelines. Senior managers sometimes feel a little foolish creating guidelines about how they should work together. “Surely,” they think, “we’re all adults here and have years of experience working in groups.” And that, of course, is the problem. Everyone has practiced dysfunctional behavior for years.

Guidelines for new and more collaborative behavior need to be explicit, simple, clear and concise.

Here are some typical examples:

- Speak honestly. Make clear and direct requests.

- Be willing to surface issues or take positions that may result in conflict.

- Anyone can disagree with anyone about anything, but no one can disagree without stating the reasons why.

- Listen for people’s contributions, rather than editing and cutting them off with assessments, opinions or judgments.

- Support each other. Operate from the point of view that, “we’re all in this together.”

- It’s not OK to win at someone else’s expense or at the expense of the firm.

- Support people in fulfilling their commitments and hold them accountable for results.

- Show appreciation by giving, receiving and requesting acknowledgment from other team members.

It's difficult to sustain teamwork at any level if company policies and systems aren't structured to support collaboration. Many firms have sponsored programs to encourage top-of-the-house teamwork. However, only a very few have supported this aspiration with pay schemes that encourage cooperation, information sharing and continuous improvement. Most businesses still use individual pay schemes, such as merit pay, individual bonuses and profit sharing, all of which work against teamwork by encouraging internal competition.

We need to pay executives so that their interests are aligned with those of the stockholders. Today, we pay them too much for what they do and too little for what we want them to do. In a letter to Berkshire Hathaway investors, Warren Buffett wrote: "In judging whether corporate America is serious about reforming itself, executive pay remains the acid test. To date, the results aren't encouraging."

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