Yesterday I had a meeting with a friend who was concerned that his sales department was in conflict with other departments in the business. Marketing, accounts and It were all finding the attitude of the sales team problematical and verging on the bullying.
“The sales team has had so much money and resource pumped into them” complained my friend who was at a loss to understand or accept that they needed more or how this had resulted in conflict between the sales team, accounts, marketing and IT!

Over extended limb
This situation is not unusual where a specific part of a business becomes an “over extended limb” and eats up more money, resource and focus than the rest of the company. Exactly the same thing happens in counties that allow one industry or faction to become dominant. (Think of banking in the UK which has become such a dominant part the country’s GDP that it’s seen as too powerful, too demanding and increasingly unpopular).

Essential to the well being of the business
Having an over extended limb in an organisation will inevitably result in conflict. This is because as one part of the business is starved of funds it will blame the other for squandering resources. The over extended limb will justify it’s existence as being “essential to the well being of the business” and will blame other parts of the business for “lack of support”, “failing to understand the realities of the situation” and changes to the status-quo  will “harm the business”.

Results in casualties
The results of such infighting is that it distracts attention onto the mission critical results the business needs. Turning around this conflict takes time and in my experience always results in casualties where good talent leaves the business.

The way to avoid conflict is to avoid over-extended limbs

In announcing that Lloyds TSB are to shed 15,000 jobs over the next three years probably contained little surprise to most people. Indeed there will be many that will be quite pleased that some bankers are reaping what they sowed without realising that the middle management and back-room boys losing their jobs are not those who will be receiving big bonuses over the next three years.

Restructured teams have an increased chance of failure
My real concern is that five thousand job losses each year, for three years, will mean a vast number of teams being restructured. The problem with team restructure is that only 60% tend to deliver targets. That means that 40% of teams fail to deliver on expectations. That’s one big storm of disruption for Lloyds TSB to navigate.

Costs can be huge
The cost of such failure in lost opportunity terms can often amount to ten times the salary of the team and in banking circles that can be  huge! ( a team salary of £1million could produce a potential lost opportunity cost of £10m) However, when one’s focus on savings will be judged on salaries saved the actual costs of the restructure often get ignored.

That is until financial statistics reveal that further jobs have to be cut because the anticipated results haven’t been met!

You would think that the topics of talent shortage and managing employees productivity were two business issues. I’ve had a few conversations with senior Directors bemoaning the shortage of talent, particularly in IT, banking and technology and both have been linked to how to manage employee productivity.

The Talent Crunch
Most people would think that with the financial crisis that finding good talent would be easy, but in fact this isn’t the case for many specialist areas. Indeed the Manpower Group report that a third of companies report difficulties in finding good talent. There is a talent crunch in India, where it’s reported that sixty seven percent of companies are unable to find the people they need. In Brazil the figure is thirty four percent and the shortage is pushing up wages and inflation.

The skills shortages in these countries is likely to have an affect on our own talent pool and attract our own talent towards high salaries and a better style of living than can be gained within Europe or the USA. This will be true even of bankers who see career progression in terms of London and New York.

Managing Employee productivity
If most businesses can’t find all the talent that it requires, or afford it when it can, then it needs to invest some time and money to improve the productivity of its existing talent. That’s the reason that people have been asking me how to measure, manage and improve their people’s performance and productivity.

It’s been interesting that in the mind of the Directors I’ve spoken to that they seem to have a vision of a “One size fits all” solution. The problem is that there isn’t a one size fits all nor is there an immediate solution to making internal talent more productive. Different strategies need to be employed for salespeople as opposed to IT,  Senior staff as opposed to Non-Executive Directors and so on. In the long-run, however, it might be the only viable and affordable solution.