Article originally published in the American City Business Journals on July 6, 2020.
Employees occasionally question the need for certain policies that impede their work. CEOs need to listen and respond in the appropriate way. They should never respond with, “Well, that’s just the way it is.”
Every company needs policies and procedures to effectively serve their customers or clients, ensure equitable treatment of employees, protect against litigation, control costs and adhere to legal and regulatory requirements. Without them, there would be chaos.
Policies should be challenged when they don’t make sense
At the first anniversary of my job as a process engineer at PQ Corporation, I received a performance review and was told that I was being awarded a salary increase of 5%, compared with a marketplace salary structure increase of 4%. During our conversation, my boss made the mistake of telling me that the other engineer in our small group would be awarded an increase of 3%.
I thought my co-worker was a solid performer and questioned why his salary increase was less than the marketplace increase. My boss said that the overall percentage salary increase for our department could not exceed the increase in the salary structure – 4%. I told him that made no sense. My boss responded, “Well, that’s just the way it is.”
I then told my boss that when I rose to a level within the company where I could influence or change the system, I would. That compensation system didn’t fulfill what I thought should be its intended objective, which is to pay employees commensurate with their performance.
Years later, I was appointed to the position of president of PQ’s global Industrial Chemicals Group. I now had the influence to change the compensation system, which over the years had undergone minor changes, but could be more effective.
I convinced the other two operating group presidents, the resistant leader of the human resources department, and PQ’s CEO of the need to change how we compensated our employees.
The new performance and compensation system that was developed had input from employee focus groups, which created buy-in. The employees liked it because it provided a more rational approach to compensation administration. Employees also had ownership in the system, since a group of them helped develop it.
Policies should be challenged when they inhibit achieving results
How many of us have worked in bureaucratic organizations where overly prescriptive policies, procedures and controls approach the point of micromanaging and encroaching on time better spent elsewhere, such as running and growing the business and providing a great customer or client experience? Unfortunately, too many of us.
As a product manager at PQ, each year I wrote detailed business plans. These documents outlined not only the objectives of the business, but also the detailed strategies to accomplish them. Due to changes in the business environment, elements of the business plan became obsolete after it was written. Perhaps that’s why it often sat in a desk drawer or in a bookcase in my office until a year passed and it was time to write the next business plan, while strategies were adjusted in real time.
Many of us are required to write lengthy reports, communicating to our bosses our activities and results accomplished during the month or quarter. This process takes time. Is there a better way of informing upper management of this information without taking a leader’s time away from operating the business?
When I became the CEO, I reduced written detailed reports sent to me to the minimum, and asked that written reports focus only on what was important. These reports consisted of a one or two-page executive summary.
The amount of verbal reporting was significantly increased. This had the benefit of increasing the dialogue between me and my direct reports, reduced bureaucracy and made for better decision making and understanding of the issues we faced. It also created more time to operate and grow the business.
Challenging policies and procedures are a good thing. Some policies address issues that no longer exist, and now only increase bureaucracy and hamper the operation of the business. When policies no longer serve a useful purpose, they need to go.
CEOs, listen to those employees who challenge policies that don’t make sense to them. These employees are your talented change agents. If frustration leads them to leave your company, they may go to work for a competitor.
Stan Silverman is founder and CEO of Silverman Leadership and author of “Be Different! The Key to Business and Career Success.” He is also a speaker, advisor and widely read nationally syndicated columnist on leadership, entrepreneurship and corporate governance. He can be reached at Stan@SilvermanLeadership.com.
