That’s how I ran my company into the ground

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Last December, a friend started working at a company that had completed its Series A funding round. The system is also well-established, and the cultural philosophy is advanced; many colleagues are returnees from abroad, but the company closed down after the New Year. Why? Weekend reading recommendations, shared with you. Actually, I’m not surprised. To give an example: in their company, using company funds to cover expenses related to eating and drinking has become an open secret; the managers are aware of it as well, but the solution is to hold endless meetings to remind people about it. Therefore, many companies do not fail because of poor product performance, but rather fall into management pitfalls. Please give this some serious thought: Is there such a common phenomenon in your company—where 5% to 10% of employees, as soon as they start work, begin to find faults and oppose you? They disapprove of all company policies and have objections to every decision made; yet they never reflect on how well they themselves are performing ； For 15%–20% of employees, the work they produce is substandard ； 20% of the employees work blindly; they have no idea whether what they’re doing is right or wrong, nor do they understand why ； Only 20% of employees’ work is high-performing. In other words, 60% of the employees in the company are not delivering proper performance – what a huge waste! Despite the many efforts made by managers, despite the amount of management knowledge we have learned and the various management systems we have tried, we still fail to achieve the desired results. Where exactly is the problem? These are the findings from my 10-year follow-up study of 200 companies. For over a decade, it has been these very questions that have deeply attracted me, keeping me fascinated by and interested in management – why do the same resources and people, when managed by different managers, yield such vastly different results? Why are so many people engaged in ineffective, or even meaningless, work? What are the key factors that affect people’s work? Why do people move? Why do many people feel that organizations don’t allow them to make a difference? The emergence of these problems actually stems from management philosophies. ◆ ◆ ◆Let results speak for themselves: Management is accountable only for performance. Phenomenon 1: Merits and efforts. Nowadays, it’s widely understood that “efforts” alone do not contribute to performance. But in reality, many people feel that they have already done enough for the company after putting in a lot of effort. In fact, we can also accept these views; many companies still use hard work as the criterion for evaluation. This shows that the concept of management is still not clearly understood. Talking about hard work is the first waste in management. Phenomenon 2: Ability and attitude – Management is only responsible for performance; it is ability, not attitude, that directly determines performance. Whoever generates performance is the most important. Attitudes are only useful when they turn into abilities. You might want to reflect on your own company: who are the employees who contribute to its success? Do hardworking people get exhausted, while those who don’t work live comfortably? And usually, capable people tend to have a less positive attitude, while those who are not capable always try to be pleasing. Then there must be a problem with your management; do you assess attitude more, or competence? If 50% of your evaluations focus on attitude, then the capable people in your company will naturally find it very stressful to work there—and that means they will leave if they get the chance. This is the second biggest waste in management. Phenomenon 3: Talent and character. Character can only be assessed in the face of major challenges; under normal circumstances, it is difficult to determine whether a person’s character is good or bad. Management should not rely on this factor, but rather should find ways to address it. The responsibility of management is to create conditions in which people have no opportunity to make mistakes, so that character can be transformed into talent and lead to improved performance. Therefore, to study management, one needs to look at economics and organizational behavior. When is \"virtue\" more important than \"talent\"? It must be noted that Derby only matters at two specific times. First, during the recruitment process ； One is during promotions. ◆ ◆ ◆Rule of equal distribution: Management is a form of distribution; managers must know how to divide three elements into an equilateral triangle – that is, ensuring equality among power, responsibility, and interests. Almost all management problems arise from the imbalance among the three. Management is essentially a form of allocation, and it should be noted that what is allocated here is responsibility, not power. The biggest mistake we make in management is allocating power. It must be clear that the basis for power distribution is not positions, but responsibilities. For example: if the responsibility for achieving performance lies primarily with the branch office, then the person with the most power should be the branch manager. But in reality, it’s often not like that. I suggest everyone make two important observations: ① Who does the company’s general manager often hold meetings with? Those who attend the meeting are the people with the most power. Does he often hold meetings with people from the headquarters’ functional departments, such as the human resources manager and the finance manager? Do you still meet frequently with branch managers and frontline managers? Those who frequently meet with the General Manager have the most authority to make decisions; however, these decisions are implemented under the General Manager’s direction. ② In the design of company titles, should the titles of front-line employees be higher, or those of the company’s functional departments? Titles carry symbolic meaning, and power is often allocated through the titles of positions. You will find that the general manager’s meeting room is mostly filled with people from functional departments, and the titles of heads of these secondary functional departments are higher than those of those in branch offices or at frontline positions. How can you make a human resources director work for a mere frontline manager? As soon as they meet and exchange greetings, there’s an immediate difference in their attitudes. Such an allocation is not based on responsibilities, and as a result, the effectiveness of management is greatly reduced. ◆ ◆ ◆Management should always serve business operations – this is a view I have always held, and it is also the topic I discuss most often. It contains two important insights: 1. What management should do must be determined by the business operations ； 2 The management level cannot exceed the operational level. Understanding 1: Why should management decisions be determined by the business operations? In a company, “running it” means choosing to do the right things ； Management is about doing things right. The logical relationship is very clear. For example, under normal circumstances, a business model based on low profits but high sales volume relies on scaling up operations and effective cost management ； Quality corresponds to price in business operations, which is related to quality control and brand management ； Service-oriented operation corresponds to process management ； Customized operations correspond to flexible management, etc. Understanding 2: Why can management not exceed operations? Because if a company’s management capability exceeds its operational capability, it often leads to losses. This is why some companies have sound systems, advanced cultural concepts, and excellent talent, yet still suffer from poor business performance. Although you are very good at management, your approach to it has problems. You might as well take a look to see whether the best people in your company are focused on business operations or management Do you hold more internal meetings or external meetings? If your executive team holds internal meetings every time and only sees their subordinates on a daily basis, then your focus is more on management than on business operations. This is why Jack Welch said: Poor managers spend the most important time in the morning on internal meetings, and spend the less important time in the afternoon meeting with clients ； Good managers spend the most important time in the morning meeting with clients ； In the afternoon, hold internal meetings for as little time as possible. From the allocation of time, it can be determined whether you focus more on operations or on management. - End -