Working the Eddies: Pace Yourself to Preserve Your Sanity
- Aug 27, 2008
- Row, brothers, row, the stream runs fast, The rapids are near, and the daylight's past.
- —Thomas Moore
The new CFO of the European division of a large, U.S.-based multinational company understood and savored the fact that he had taken on a uniquely challenging job. The senior corporate leadership wanted to transform the division's financial operations from "just" pure finance and accounting to provide in-house consulting to field operations. He and his people would not confine themselves to keeping score. They would also help field executives improve their scores through better understanding of financials and their drivers. The CFO and his staff would help the field executives improve their financial game. His group was to provide coaching to operations staff in the field, especially to those parts of the division that struggled. He knew that this work would require considerable time—to develop new consultative and teaching skills, to travel, and to develop broader working relationships with the field. He knew that he and his people would also need to address the introduction of the Euro, the evolving EEU, and the rapids of increasing globalization. All this, and continue to do their day job of managing regional finances.
The company gave him many jobs, but he didn't let them distract him from what he believed to be his true job, namely, change. He knew the internal and external changes could swamp his organization. He knew he needed to find a way to reduce the flow. His group spent considerable time every month collecting data for monthly reports sent to senior corporate managers in New York—this seemed a likely target for simplification. He asked his staff how many data points they collected regularly. They reported approximately 3,600. Next, he asked his staff for the bare minimum number of data points that they felt were needed to fulfill their professional obligations. Just 600. Time gained: 40 to 60 percent (not more, because of the lack of numerical redundancy and the accompanying need for special care and extra checking of the 600 numbers).
The CFO then flew to corporate headquarters in New York City. He proposed to senior management that they narrow the 3,600 data points by a sixth, to 600 measures. This would cut staff time and free them up to tackle their pressing challenges of change, both at hand and down river.
The CFO made a compelling argument to senior executives. He pointed out the folly of trying to do everything. They would burn out staff and erode their ability to deliver on their key transformation initiatives. But the senior managers told him that he didn't understand: They wanted their numbers...all of them...and they wanted their change, "son." The CFO continued his negotiations over the next three days. Power breakfasts, power lunches, power cocktails, power dinners, power post-dinner drinks. He drew on his reputation. He worked Manhattan's corridors of plate glass and stainless steel as well as he could. In the end, the corporate powers still wanted their numbers, "son." All of them. And they wanted their change.
The CFO considered resigning. He firmly believed that continuing on the ordered route would drown his people. He could see the loss of staff, failure of the change initiatives, and burnout. Between this rock and a hard place, he made what might be considered a courageous decision—or a very foolish one. He went back to his staff and told them they needed to come up with algorithms to generate the 3,600 points of data from 600 core data streams. They needed to do it with a maximum of 1 percent variation whenever he chose to test them: historically, currently, or in the future. Using these algorithms, they would only have to collect 600 data points but could report all 3,600 to the CEO. The staff developed the algorithms in two weeks, and they worked well. (Note that he was not "cooking the books," just coming up with a complete set of reliable numbers by a more efficient method. This also took place before Sarbanes-Oxley.) Extreme conditions, he believed, sometimes call for extreme measures.
The CFO then met with his 14 direct reports and told them to use these algorithms to complete corporate reports from that day forward. He requested that they not volunteer information about the new approach, but, if asked, they should answer truthfully. He wrote a memo outlining the way to complete the reports henceforth, signed his name, and publicly gave a copy to each of his direct reports. He provided them cover even as he put himself into their hands. Any member of his staff with an ax to grind could have gone to a fax machine, dialed corporate finance, and taken him out right then and there. None of them did. They appreciated that he had their backs in managing the amount of change on their plates...and that they, as they showed, had his.
He bet that handling change well over time mattered most. He bet that the algorithms would buy him and his people enough time (six months he figured) to make enough progress on the change that corporate would forgive his trespass. He also bet that to try to do it all would mean failure. He bet that he could pick the 20 percent of his job that mattered most, which would account for 80 percent of his success. He placed a big professional (and personal) wager, but to do nothing was to bet that he could continue to do everything even as the pace and volume of change in his environment increased. That was a fool's errand, he decided, and too dangerous for his direct reports.
The new method generated no questions from anyone in the organization. Perhaps no one noticed. Perhaps no one cared. What corporate leadership did apparently notice and care about was that the crucial organizational change went well. The CFO successfully transformed his operation without the kind of ill will and employee attrition that too often accompany such initiatives. Furthermore, he saved the energies of his people for the ongoing challenge of conducting business in a changing Europe.
Did the CFO do the right thing in this act of "mutiny?" He circumvented a direct order from senior corporate executives. If you think his job is to obey orders, he obviously did the wrong thing. And if you think his job is to keep track of numbers in the same way it has been done in the past, he was clearly in the wrong. This is the kind of action that might have been in his job description. But if you think that his real job is change, then he proved himself to be a superior leader, perhaps even better than his organizational superiors. He recognized the limits of his own resources and those of his staff. He recognized that the danger of bending the rules came to less than the danger of burning out himself and his staff. He did what it took to get the job done, the job of change.
This CFO also saw that he no longer travelled aboard an ocean liner, where the orders of the captain could be cheerfully relayed to the engine room and carried out. On an ocean liner, his actions were clearly mutinous. But they were not on a ship on the open seas. They were paddling together in whitewater. He had to keep his team afloat and keep them from exhaustion. That was the highest priority, because if the whole operation went under or he began losing people along the way, they wouldn't achieve any of their goals or survive the rapids they were sure to meet downstream.
This is not to advocate breaking rules, and certainly not breaking laws. Every manager needs to decide where to draw this line. But you cannot act like a sailor. You cannot blindly follow orders or do your job as it is written in your job description. Besides the moral risks, you might simply perform the wrong job. Updating your job description might occur once a year, but your job (and the challenges it presents) will change much more quickly. If the organization is gasping for air or flying over a waterfall, it won't make much difference that you were just following orders. It is not your real job to follow orders. Your real job is change.
All Hands on Deck
The ocean liner organization sets its pace by controlling its passage through the environment. Except for emergencies, employees take turns in clearly defined watches. In contrast, the always-on, 25/8 environment of whitewater has no natural breaks in the action. Unless you control your own pace, you will be swept headlong downstream, battered, bruised, and burnt-out. You cannot control the relentless pace of the environment around you, but you can control your passage through it by learning the skills of effective pacing. You can be in the turbulence but not of the turbulence.
Kayakers work the eddies behind rocks to move slowly down a fast-flowing stream (see sidebar "Working the Eddies"), standing still while the river rushes past. The CFO did the same thing. He couldn't slow down the world around him, but he could set his own pace moving through the turbulence. He realized he was no longer in a world in which you could rally followers for an exhausting push through perilous waters and then rest and lick your wounds. There is no bottom. Change follows change, relentlessly. He needed to pace himself and his team. He understood that in whitewater environments, you need to learn to pace yourself, and pace your people.