CEOs and Long Knives

 

As my regular readers know, I have long maintained that the 20% worst managers who are in command of 80% of the information they need to obviate any given decision will consistently out-perform the 80^th percentile best managers who have only 20% of the information so needed. Combine this with the age-old axiom that information is the life-blood of the organization, and what do you have? An inescapable conclusion: there are going to be people in the organization who will attempt to manipulate – if not out-and-out control – the flow of needed information in order to advance their own personal agendas.

It’s unavoidable.

But it’s not as if the information stream dammers and sluicers have a completely easy time of it. To the extent that chief executives are unclear on which bits of information are relevant, trying to anticipate what data collection activities and processes need to be controlled can be next to impossible. Much like Stan Lee, who seemingly can only go a couple of years before re-telling the story of the origin of Spider-Man, I really like to tell this illustrative story. I once worked for a small engineering company that had no idea how to project future revenues. None whatsoever. But there was no shortage of those who presented as if they knew. During a multi-branch conference call, one out-of-town (and out-of-touch) manager posited that their revenue projections should be based on the number of engineers on staff, multiplied by their billing rates!

“That’s not how you project revenues.” I stated flatly, drawing looks from the execs around the boardroom where I sat, both irked and astonished.

“One crude but effective way would be to assess the win rate of each office, multiply that figure by their existing proposal backlog, and time-phase that figure by the periods of performance.” I continued.

The company’s CEO scoffed, “I don’t want to prescribe any specific formula…”

“Then take the contract win rate by type of work rather than geographic placement, sort the proposal backlog by that figure, multiply the two, time-phase that figure, and you have your answer.”

“Again” the CEO re-scoffed, “I don’t want to prescribe any specific formula, but everyone’s projections are due by the end of the week!”

After the meeting I approached the CEO for a side-bar.

“Don, if I could produce the kind of information you’re looking for on this revenue projection business, and demonstrate that my approach is superior to the ones being undertaken by the various offices, would you at least look at those reports?”

“Knock yourself out.”

I was in an enviable position. As Project Controls Manager, I had no narrative to support or defeat, no allies to buttress nor enemies to put down. All I had to do was collect some readily available data, use the proper process, and push out the (extremely valuable, of course) information stream.

Long story short (too late!), the CEO as well as the owner of the company came to eagerly anticipate the revenue projection reports that emanated from the (rather basic) analysis of the contract win rates and proposal backlog, sorted by various criterion.

However, I made a lot of enemies in the process. All at once, here was an extremely valuable information stream, going straight to the CEO, that couldn’t be diverted, dammed, or manipulated by those in the organization who had narratives to defend, narratives to advance. The long knives came out, and I was working elsewhere within months. So, too, were all of the other people in the company, its having been bought out and closed down within a couple of years.

But it did teach me a couple of valuable lessons which I’m happy to pass along to my priceless readers:

·         Being right makes you more valuable to the organization, but it also makes you a target, and

·         Those who view themselves as the dispenser of valuable management information to the executives will do what’s needed to avoid being usurped.

So, continue what you’re doing, and do your best to provide those needed (relevant!) management information streams.

Just watch your back.