July 6 2011 by admin.

It’s been quiet here and at my other blog, Tom’s Technology Take. Sorry about that. When I joined Enterprise Strategy Group in April, they immediately gave me the opportunity to start a new blog, Marketing Information Technology. It’s been great. I can write about technology and marketing all in one place. I still will update Tom’s Technology Take from time to time, especially when I find some really cool technology. The more business-like musing will be found in my new home at ESG.

While there check out the other awesome ESG blogs. Our analysts have great observations and insights.

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March 3 2011 by admin.

Maintaining copyright on your work is incredibly important. It’s not about making money, although that maybe one of your goals. The real issue is control. Do you get to control how you are quoted? Do you get recognized for your work? Copyright law is designed to give control of a work to its author. If the author wants to charge for use of their work, they can do that. If they want to share it for free then copyright law gives the author the tools to do that in the manner in which they want.

Licensing is about setting the terms for the use of your work. For anyone to do almost anything with your work they must have a license. Otherwise, they can’t do anything. Yes, there is fair use, but that is very limited. This is generally a good thing but many writers/bloggers/programmers/artists who distribute works over the Internet don’t attend to licensing and inhibit valid distribution of their work.

There are two problems with licenses. They tend to get complicated and are often incomprehensible to the average person. That makes compliance with the license tough to maintain. It can turn good people into inadvertent pirates. The good news, there is an easy way to license your work, especially casual works, provided buy a great organization called Creative Commons.

Today I am correcting an oversight. It turns out I never put any licensing information on this blog. This means that no one could (legally) share it without asking for permission. How 1990’s that seems.

Here is the new licensing compliments of the Creative Commons organization.

Managing Tough Business Problems by Tom Petrocelli is licensed under a Creative Commons Attribution-ShareAlike 3.0 United States License.
Based on a work at blog.businessproblemmanagement.com.

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February 28 2011 by admin.

In “The Lord of the Rings”, the great work of fantasy literature by J.R.R. Tolkien, the villain Sauron has one fatal flaw. This flaw brings about his ruination. Sauron does not trust his minions to act independently of him and so must direct everything they do. The problem is he can only turn his “Eye” – basically his attention – to one direction at a time. If he is looking in your direction, the full weight of his power come down on you. If he is looking elsewhere, he barely notices you. In the end, because his attention is not where it should be, the heroes are able to accomplish their quest and Sauron is overthrown.

Too often, managers act this way. They do not trust their people to act independently. If the manager’s attention is on you, you feel the full force of their gaze. If not, you are left adrift.

At first, it might seem advantageous to have the attention of a manager, perhaps even the CEO. It is but not when it’s solely on one group. No one can operate effectively when they are placed under the microscope. Knowing that every thing they do is being scrutinized makes team members nervous. It signals to others that the group can’t be trusted since they are not being treated like they are trusted. Under this type of intense attention, group members spend most of their time trying to find ways to please the manager or move “the Eye” in a different direction. All the while, the rest of the team is not getting the attention it needs and deserves.

This is common in companies run by entrepreneurs. By nature, many successful entrepreneurs like control. They also think that they have more to give than anyone else. And more to lose as well. Both of these situations are true to some extent. As successful founders they have learned many lessons and have much of their own net worth tied up in the venture.

Entrepreneurs are also builders and fixers. This becomes a big problem when coupled with the Sauron style of management. Nothing the team does is good enough, everything must be fixed. Plans, experience, standards, other points of view,  none of these apply anymore and it is frustrating to the team.

Unfortunately, this management style denigrates the unique experiences that others bring to the company. It makes productive and successful people leave for places where they perceive they are more appreciated. It allows disaster to occur because of inattention to other parts of the company and because the manager is diving into tactical details instead of driving strategy.

I worked at a company like this. It was often a difficult place to work. When the CEO was paying attention to your department, everything was harder to do. You had to justify every action, no matter how small. You literally had to plan for interference in low level details. At the same time, you knew other things were slipping because “the Eye” was on you and not on others. Ultimately, many of the best people left or were poached. Often the company seemed to careen from crisis to crisis. A lot of time was spent insuring that the CEO was paying attention to anyone else but you.

As a manager, you have to be mindful of the tendency to place all of your attention on one part of your team. Instead, you have to show them that you trust them enough to carry out the plan but be around just enough to provide guidance when things are not going right. Place some under the microscope and you will only make them upset and frustrated. everyone else will be starved for attention. Your team members will spend time – time better spent on making products and generating revenue – trying to divert your gaze toward someone else. They will focus on you and not on the business.

Like Sauron, this will be your ruin. Sooner or later your attention will be in the wrong place at the wrong time and it will be too late. By then you will have destroyed your team and perhaps your business. Instead, learn to detect when your “Eye” is lingering too long in one place. Ask yourself “Don’t I have other things to attend to?” Avoid the trap that “the Eye” lays for you.

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February 23 2011 by admin.

One of the major trends in the computer industry today is cloud computing. There are a number of debates as to what cloud computing really is. Some feel it’s all marketing hype. Others view cloud computing as a way to completely change the way IT is financed, moving infrastructure form a CAPEX to an OPEX model.

No matter your religion on cloud computing one thing is certain – more and more IT is going to be outsourced to nearly anonymous services. Whether it’s Google, Amazon, or any number of other vendors who supply applications and infrastructure via a cloud model, a lot of IT will shift to these providers.

Perhaps.

The big fly in the ointment is trust. Do I trust you with my data? Can you be trusted to deliver vital business services all the time? Should I trust the people inside your organization, most of whom I’ve never met?

Trust is the cornerstone of all services because it is a measure of perceived risk. There are certainly different levels of trust connected to different types of risk which, in turn, are associated with different outcomes and costs. Someone might trust you with something small with a negligible negative outcome but not when the stakes are high.

But gradients of trust and outcomes don’t matter as much as you might think. The psychological aspect of trust is a bit more black and white. One negative incident might be a temporary failure of the quality control system. Intellectually, we know this. Emotionally, it ruins our trust and raises the perceived risk well above the actual outcome. A single bad outcome can destroy all trust in the business. Even if you fix the problem, it introduces lingering doubts.

Quality programs, good business processes, attention to details, and a customer service focus are all part of maintaining trust. But we all know that a zero defect goal is unobtainable for service companies. Services are built on humans not on widgets and humans make mistakes. The big question is how do you build trust, especially after a mistake is made?

This is a simple one – convince the customer it will never happen again. That’s a simple solution but it’s hard to implement. As managers we have to take bold action to address the root cause of any customer problem, even to the point of taking extreme measures. It’s not about fixing the customer’s problem now. You have to be able to convince them that this was an anomaly that will never occur again. Ever.

That may mean showing customers the process you put in place to insure quality after the failure. Perhaps you may need to let them in on how much money you are spending to insure the same thing doesn’t happen again. Letting customers know that you have pulled an employee out of the line and sent them for retraining will help. You might even need to fire the hair stylist that gave someone the unintended buzz cut and let the aggrieved customer know about it.

In other words, fixing the problem is not enough. You have to open and honest with customers. It requires transparency.

Here’s an example. Several years ago, I took my kids to a local fast food taco restaurant. My daughter got a bean taco with a dried black substance in it. It was horrible and she couldn’t eat anything after that. Complaints to the manager went unheeded. The chain responded with an apology and a coupon. So what. Everyone does that. What impressed me was how they took corrective action and told us about it. They talked about retraining the staff and making some staffing changes. They convinced me that this was an aberration and would be unlikely to happen again. Unfortunately, my daughter was less convinced and it was years before she would go back to any store in that chain. She will never go back to the original store. Some distrust has lingered.

It is not enough to have systems in place to insure quality. It is not enough to take complaints seriously and give compensation to customers that have been wronged. You have to insure problems will never occur again and communicate that to the customer. When a mistake has been made have to begin to rebuild trust from the ground up. If you can’t, your business is doomed.

Whether it’s cloud computing or tacos, trust is everything. Service companies are only one mistake away from disaster at any time. You maintain trust by providing quality work. You fix trust when it has been damaged by bold action and transparency. Nothing less will work.

Posted in customers, mistakes, management | No Comments »

January 25 2011 by admin.

I started thinking about this question while on a recent vacation. I had the misfortune to be traveling on US Airways when a big storm hit two of its hubs nearly simultaneously. At some point in the past someone, most likely a highly paid executive or financial analyst, had made the decision that planes should run very near capacity all the time. This had two rather obvious effects. One, it helped make the airline money. Two, if there was any disruption in the system, such as bad weather at a hub, there would be no excess capacity to mitigate the effects of the problem and customers would have their flights canceled.

It’s easy to talk about the decision to fly so close to capacity that you can’t handle peak loads. But as I sat in the terminal I couldn’t help musing about the airline employees I saw all around me. More specifically, those employees who were tasked with handling the aftermath of the problem. I was curious as to what their pay looked like as opposed to the people who made the decisions in the first place.

I’m not against executives making a lot of money. I know from personal experience that executives work very hard and are responsible for a great many things. But other people work hard too. As an executive or manager, you have to respect and reward those people. You also have to recognize that not everyone has an equal impact on your business. Too often the front line employee, the one most in contact with your customers, are the lowest paid. In retail, it’s the store clerk. For many businesses, it is the customer service agent who takes orders. We tend to pay specialists a lot and those most responsible for keeping customers connected and revenue flowing the least. You can see why this doesn’t work. In my industry this usually means that engineers can make six figure incomes while technical support gets $12 an hour. Or are outsourced overseas.

In the case of the airlines, that low paid person would be the reservation agents and gate agents. I’m pretty sure no one consulted them when deciding how close to maximum capacity planes would operate at. Yet when that decision causes massive customer problems, it’s up to these agents to deal with the problem. If your flight is canceled, the folks who cut back flights to increase the number of people per plane don’t have to deal with it. Not with the customer anyway. Instead, it’s the reservation agent in the call center. When customers are stranded in airports, upset that they won’t get home, it is the gate agent that has to find a way for them to get home.

These agents are often paid low compared to pilots and other professionals. Now, I believe that we all want happy well paid pilots. The disparity though is huge. At American Airlines, pilots make 6.5 times what a customer service representative makes. That means that the employee trying to get me to where I need to be (such as home) makes under US$45K per year. To  the customer, the CSR is the most important employee of all at that moment. The reservation agent on the phone makes even less and yet they are responsible for ensuring that revenue flows. 

At US Airways, a Senior Financial Analyst makes nearly three times the median salary of a Flight Attendant. That means that the people who we trust to keep us safe during a flight makes a third less than the person who decide to overload the plane to increase profit margins. This is clearly out of whack.

The reason for this is that we don’t pay people according to what they contribute. We pay them according to how rare their skills and education are. The pilot is both necessary and rare, hence extremely expensive. Reservation agents need very little education or training so we pay them little. It doesn’t matter that, from a customer perspective, these people are more important than cost accountants, marketing people, or the CEO for that matter.

This is one of the reasons, I believe, why airlines rate at the bottom of the customer service ratings. They act like customers don’t matter. Decisions, such as charging for one bag coupled with small overhead bins, rankle customers. Airlines often provide no food  – or make you pay exorbitant amounts for food - when you’re trapped on a long flight. Add that to an on time record that is abysmal and you get a picture of an industry that is out of touch with their customers.

The airline pay scales are a symptom and a cause. By not paying their customer facing people more it signals their disdain for customers. It also inhibits airlines from understanding what customers are really feeling. Ultimately, brand loyalty has slipped away from airlines and they find themselves a commodity that goes for the lowest price. It’s their own fault. You can’t claim value add when you add no value that customers want. In the airline business positive brand image is derived from getting people where they want on time and outstanding customer service.

The lesson here is that the people who work with customers are your most important people. Paying them poorly tells your customers just how much you value them . In the case of the airlines, you get the impression that they don’t value their customers very much. It also creates the least amount of motivation for the front line workers to produce spectacular results for customers.

So, to the US Airways CSR who got me on a much earlier flight after one of mine was canceled and another one delayed, thanks. To the gate agent in Philadelphia who printed my new boarding passes just to take away my angst about my seats, thanks also. You should both ask for a raise. You deserve it.

Posted in customers, management | No Comments »

January 4 2011 by admin.

“His job is to shed light, not to master” – Terrapin Station, Grateful Dead

It’s only fitting that the lyric from a Grateful Dead song should set the stage for an article on modern management. Written in the 1970’s, it comes from a time of extraordinary change in business and management. Management was on the cusp of a transformation just about the time that song was written. This transformation was fueled by deep changes in the world economy and unfortunately included the shedding of entire layers of management.

By the early part of the 20th century industry had changed dramatically. Small cottage industries and factories gave way to massive enterprises. Automobiles, steel, aircraft, ship building, and a host of other types of industries relied on massive factory complexes. This coincided with the rise of scientific management which was embraced by the likes of Henry Ford. This management style breaks processes down to repeatable actions. Workers are expected to do these actions without question over and over again. It turns humans into robots that need direction. Workers didn’t make decisions. Only a select cadre of educated professional management did. This approach evolved over time and culminated in  the military-like command and control management structure of mid-century. For all it’s benefits, it was inflexible and required vast layers of management.

By the end of the 20th century, all that had come crashing down as the burdensome cost of management caused companies to shed middle management. The 21st century has seen the emergence of a highly decentralized management system with fewer layers and fewer managers. For this type of structure to work, employees must become team members capable of independent action. That is, they need to be autonomous not automatons.

This has vastly changed the role of the manager. A manager’s job now is to provide guidance not direction. Managers are expected to be experts who can help teams navigate difficult problems as well as contribute directly to their mission. They have to let people do what they know how to do, help them to grow in their roles and become more expert, evaluate outcomes, and make corrections. In general, managers have to play a more strategic role in the mission of the team. They can no longer simply provide tactical direction.

Guiding is a lot harder than it sounds. When you have responsibility it is natural to want control. It is also tough to sit back and let things happen when you feel, perhaps even know, you could do it better yourself. However, the long term advantages of not taking control are many including a motivated and flexible team.

So what should you do. Here’s some tips:

• Ask questions. Ask  “What do you think is wrong?” or “How do you want to proceed?” or “What’s your solution?” Asking questions can signal your intent while allowing team members to create their own solutions.
• Tolerate small mistakes. It’s the only way people can learn. However, make those who make mistakes responsible for devising a solution. It gives them a sense of mastery and allows for redemption in the eyes of the company.
• Only direct when necessary to prevent disaster. Guiding rather than controlling is fine unless it will lead to an epic failure. Letting a team member walk off a cliff to learn something will only leave them disillusioned and unmotivated. You might also allow them to hurt their reputations to the point that they are no longer useful at your firm. Save your direct authority for these instances.
• Immediately evaluate and correct behaviors of all sorts including social behaviors. As teams rely more and more on self directed individuals, conflicts are inevitable. In much the same way, problems with performance and behavior will emerge. In the past, these were held in check by the command structure. Since decisions were only made by managers, the type of problems an average employee could cause were small. Now, they amplify immediately. Correct these problems immediately before they get out of hand.
• Hire and foster trustworthy people. Get rid of those you can’t trust. Not only people you can trust to get the job done but folks you can trust to do the right thing. People you can trust not to play politics, not to backstab, and not to prosper at the expense of the team. A style of management that is not based on control requires trust. If you can’t trust someone, it simply won’t work.
• Learn to wait. A great many problems figure themselves out or your team can figure them out. Jumping on every problem yourself is not only inefficient but also teaches the team that they don’t have what it takes to fix problems. It also teaches them that they don’t have to. Patience  is a virtue worth learning. So is impulse control.

To be honest, it took me years to figure out how manage without directing. I’m still learning. It’s so easy to just tell people what to do. When someone presented a problem my first impulse was to pick up the phone or shoot off an email giving orders. It’s hard to give up control when you have responsibility.

But the benefits of not controlling everything are great. It’s much easier to scale your business when you don’t rely on a few managers. You also free yourself for more strategic work and no longer have to worry about every little detail. And, most important of all, you create a flexible environment capable of responding to all types of changes in the environment. If you’re lucky, you might even be able to go on vacation without too much worry.

Remember what General George Patton once said “Don’t tell people how to do things, tell them what to do and let them surprise you with their results.” Even though he said this over 60 years ago, it is the perfect example of modern management.

Posted in solutions, mistakes, approach, management | No Comments »

December 15 2010 by admin.

People often need  to buy something but don’t because they perceive risk in doing so. Even if they eventually make a critical purchase they linger over the decision for far too long. They ask: “What if it doesn’t work? What if turns out not to do what I wanted? What happens if the desire results don’t emerge?” A lot of risk is mitigated by the actions of the seller through devices such as warranties. If you know that you can return something if it breaks you’re more likely to buy it right away.

Personal injury attorneys have been aware of this for ages. They know that lawsuits, even strong ones, may not go the way their client wants them too. If you had to pay a lawyer upfront for prosecuting your suit you would be less likely to file one in the first place given the costs of doing so. So, attorneys who practice this type of law share the risk by agreeing to contingency payments.

Contingency payments are the sharing of the profits from an activity. It’s a bit like a commission. If you prevail in your lawsuit, the lawyer gets a portion of it. If you don’t, they don’t get paid. The attorneys’ payment is based on the money they generate.

This is becoming a more common tool for many other types of business. For example, there is a booming business in challenging real estate assessments. Firms get a paid a portion of what the property owner saves. Companies that help other companies reduce costs often take a percentage of the savings over time. No savings, no payment.

Unfortunately, this is still an underused tool. Most companies want to be paid for delivering services or goods, not for the outcome they generate. This is a mistake. First off, the fees you can generate are higher with contingency payments. It’s easier to give up a portion of a success then pay for something with an uncertain outcome. Payment is for performance not implied performance. This also makes the buy decision easier. Since it’s a less risky decision it’s an easier decision.

And, since the customer doesn’t pay until there are results, contingencies payouts can keep down litigation. There’s less reason to sue when you haven’t paid  anything.

Contingency pay structures are not everyone. They work best when there are measureable financial outcomes. Simply delaying payments until delivery is not a contingency structure. That’s C.O.D.

Most of all, contingency fee structures require trust in the customer. This requires more due diligence than normal. if you think the customer will try and cook the books to reduce the fees then this isn’t a good time for contingency fee arrangements.

Still, in a difficult economy full of all types of business risk, this is another tool to close a sale. And we can all use more tools for generating revenue right now. Share the risk and share the reward. It’s the ultimate win-win.

Posted in sales, solutions | No Comments »

December 10 2010 by admin.

I’ve worked in a great many places where any type of conflict or expression of upset was highly discouraged. How silly. I’ve seen a number of managers who want to create a culture of total calm. They inevitably fail. 

I’m not advocating violence, humiliation, or abuse. It’s generally bad for business to belittle people, throw things, or get into fist fights at work. It’s also just wrong. We don’t treat people that way. I’ve also known people who punched holes in walls because they were angry. That just shows a lack of self control. Instead, anger should be turned into a less violent and aggressive form that can actually be productive.

To try and eliminate all conflict or anger is foolish on several accounts. First off, you can’t actually do it. You can force people to act happy or calm but they aren’t really. Instead, they will find other outlets to express how they feel, many of which are completely unproductive. In fact, when you try and banish honest anger, you encourage passive resistant behaviors which undermine your workforce. Passive resistance is resistance. It is aggression masquerading as calm and inherently dishonest. Unfortunately, when you try and ban honest conflict you reward folks who act in more underhanded ways. You reward the type of behavior that destroys trust.

Another reason it is silly is because it removes a management tool – theater. Sometimes the team just needs to get a message and for whatever reason aren’t. Maybe they have an unrealistic view of how they are performing. Perhaps the situation is worse then they want to admit. A lack of emotion sends the wrong signal. It tells people that everything is fine and they’re doing great. When a team or person is underperforming, appearing too calm and controlled allows them to think that the situation is not all that serious. They will not understand how serious you think the situation is and be motivated to correct the problem. Worse yet, when the things becomes dire for them they will be surprised and hurt. They will accuse you of not communicating the gravity of the situation to them and they will be right.

What is important is not to act this way all the time, just when necessary. The contrast helps to tell the story. Being annoyed with your team is a way to teach them lessons about how to perform. If you are too sedate they don’t learn the lesson and you do them a disservice.

Finally, banning anger doesn’t get to the root of the problem or help people find positive ways to express their upset. Issues will not get raised that need to be because team members won’t want to be accused of violating the culture that you have created. No one will want to tell you anything because they won’t want you to perceive they are angry or upset. They know that someone will accuse them of being out of control or defensive, negating what they are trying to communicate. At that point information flow to you will have stopped and key issues will be allowed to balloon before you even know what has happened.

Why do some managers try to create this culture of non-conflict? One reason is that they themselves don’t handle conflict well. They get upset and don’t know how to deal with it. In that case, you have to learn to deal with your own emotions since conflict is inevitable. Conflict will not disappear because you bury your head in the sand.

Many managers misread anger as well. They see it as someone trying to impose their will on others. Sometimes that’s true but more often it is a sign of passion, a signal that someone cares about the company and how they perform. They are saying “this matters enough that I’m upset about it.” This is much better then the people who don’t care enough to feel anything about what they do.

Another reason some managers suppress conflict is the wider culture of entitlement. We live in a time when everyone expects a prize just for showing  up. In the workplace, it translates into people who expect constant praise and cannot handle displeasure. Even when they make mistakes, some people don’t know how to deal with another person being upset with them. Manager’s try and avoid problems with these people by suppressing conflict and anger entirely. That way the whiners don’t head to their boss to complain. This is a behavior these people need to unlearn or they will never progress in their careers. They have to figure out how to deal with how others feel about their performance. Otherwise, they will never be able perform in a way that allows them to grab the big prizes in life. They will always have to settle for “Thanks for showing up”.

I can’t remember all the times someone has patted me on the back and said “good job”. Frankly, they all blur together. I do remember the times when someone was upset with my performance. They stay with me and help me to continue to improve to this day. These are important lessons.

So, don’t suppress conflict or upset. Use it! Let your people know that what they did was unacceptable but then help them figure out what would have worked better. Don’t tell people to act calm when they don’t feel that way. Instead, help them to channel that energy into finding solutions to problems. And don’t build a culture where people are afraid of having normal emotions. That just gives fuel to those that would act in an underhanded way, creating a culture of distrust.

Anger is an energy. Harness it!

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November 30 2010 by admin.

Anyone who worked with me when I was young will tell you that I had no respect for processes. I was anti-process. To me, it seemed that all corporate processes were designed to create bureaucracy, allow petty people to exercise power they had no right to, and inhibit creative thought.

In my moments of frustration, I still think that.  That’s because a lot of process is bad process designed by people needing control without regard for getting useful work done. Good process tries to streamline operations and leave time for more creative pursuits. It removes the worry of “what to do” and helps keep things from falling between the cracks. Bad process, on the other hand, is about creating unnatural gates that make some people feel important and relevant.

In a nutshell, I respect and approve of good process designed by the right people for the right reasons. I despise bad processes by and for petty people that adds no value to corporate operations and creates minor company mandarins.

Despite my aversion to bad process, I advocate following processes that are in place. Too many dynamic people fight a process when they are in the middle of mission critical projects. That’s understandable. You have a lot to do and slowing down to pay homage to a bunch of gatekeepers is irritating. It’s counterproductive though. You end up  expending a lot of energy when that energy needs to be directed toward completing your mission.

Instead of fighting the system, there are times to suck it up and just follow it. In fact, learn it so well that you know the shortcuts. Find out which participants are likely to hold up progress and court them. You see, this is what they want – for people to come and show respect. They use the process to extract it from people. A little respect upfront and you will find they are your ally, willing to streamline decisions for you when they normally wouldn’t. Pushing against the system will only slow down what you need to do to accomplish your mission. It’s counterproductive.

That’s not to say that you should stand for a bad and abusive processes. That irresponsible. But tackling process revision in the middle of an important initiative is not the right time. Even altering a bad process needs to be done strategically and in the proper context. It’s best not done in a crisis or time pressured environment. Changing processes is a mixture of business engineering and politics. That’s not something to be undertaken in the midst of a big endeavor.

So, a note to my younger self – wait until after the product launch to tackle the bad process to the ground. In the meantime, just deal with it.

Posted in mistakes, approach, management | No Comments »

November 22 2010 by admin.

Years ago I was working at a company and asked for a set of financial reports for my department. I asked and asked and kept getting the runaround. This worried me because I needed the information to effectively manage my group. I was a bit concerned that it seemed so hard to generate a simple P&L statement and budget report. What I didn’t know at the time was that they were intentionally hiding the information from me.

This is, unfortunately, a common occurrence. You ask Engineering for a progress report and get pushed off. You try and get sales projections – that you know exist - for your product and no one can find or produce them. Maybe you need cost information and accounting keeps telling you that they don’t have time to put together a simple report. What’s going on here?

Hiding information is a big red flag for a manager, especially at the executive level. It usually means that something is terribly wrong. Probably more wrong than you thought in the first place. People refuse to share information as a way of controlling their situation. They think that by keeping you in the dark they can better manage their problem. This rarely works. More often the problem gets worse as other managers stop trusting the people who are hiding something. Those denied vital information will become angry and their imaginations will often come up with situations that are worse than the real one. Few things are more destructive to a business than loss of trust.

People hide information for a number of reasons. The most common I find are:

• Embarrassment – the project is behind, the bug is real, someone has dropped the ball. Someone is trying to avoid an unpleasant reckoning. No one wants to be exposed as having made a mistake or not meeting expectations so they try to hide it.
• Buying Time – when someone seems hesitant to share vital information it might be more than an emotional response to a mistake. They may be trying to fix it. It’s like a gambler who, when they are losing, doubles down. They think that if they can hold off the dogs long enough they will come up with a solution and no one has to know what really happened.
• Control – I find this often the case for lower level technical people and accountants. They don’t feel they have real control in their jobs. All they can control is the pace of information they produce. It makes them feel more powerful to make you work for the information they control. This is the very definition of bureaucracy.
• Disorganization – some people are just so disorganized that they can’t get you what you need in a reasonable fashion. You know who these folks are – the perpetually harried. Their lack of organization keeps them constantly under pressure and your request only makes it worse. It’s hard to tell these folks from the control freaks.
• Malfeasance – not just a simple mistake but real wrong doing is a major reason people hide information. If you were afraid of losing your job or going to jail, you wouldn’t try and help others to discover it.

The first two reasons are, to some extent, understandable. That’s not to say it’s a tolerable situation. Yet, all of us can empathize with those who have made a mistake and are afraid to be open about it. It probably says something about the organization as a whole, something that needs to be addressed. If you suspect this is the case, you have to assure the people involved that this is not a witch hunt. They need to know that you are sincerely trying to help the situation whatever it might be. If they see you as an ally and not an enemy, they will produce the information. You will be given a wonderful opportunity to build trust and a relationship.

The control freak is another story entirely. They are trying to create little Dilbertian fiefdoms within the company. These people become bottlenecks and inhibit your ability to accomplish the company mission. These little mandarins cannot be tolerated. If you suspect that this is the case, you need to take it up with their manager. Maybe even higher up the food chain. If they work for you, correct their behavior or get rid of them. Otherwise, you will become one of the least effective managers in the company.

Before doing so, you have to be sure you are not just dealing with a disorganized person. Both tend to use the same set of excuses (no time, can’t find the information, you’re low in the queue) but with the disorganized person, it’s real. They need help getting themselves together. You can offer to do that by lending them resources but that’s a band-aid. I found that if I could help them streamline their processes, some of the problem went away long enough to teach them organization techniques. That’s easiest if they are in your organization and not someone else’s.

Finally, if you suspect foul play, if you think it’s malfeasance, you need to hand it over to whoever has authority to investigate. No fooling around here. If they work for you, remove them from their duties and see what is going on. Their noncompliance with requests for information becomes the excuse you need to dive into their affairs. Don’t hesitate. People like this often have other problems (drugs, alcohols, money) that will only get worse. If you find out now, maybe you contain the damage they do to your company and themselves. In the end, you might do them a favor.

When people in an organization won’t share vital information with people who need it, it’s a bad sign. Unless there are real confidentiality or trade secret concerns, you have a problem that must be addressed immediately. These are the clogs that plug up the corporate drain. Sooner or later they back up and make a mess. Snake them out now before you find yourself wading in sewage.

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