How companies tend to focus on status rather than on efficiency, still today.
I started my career in procurement and supply chain management for a large FMCG company in 2008. I was thrilled to be accepted into an organization that was heralded as the pinnacle of efficiency, customer focus and procurement best practice. Many of the business cases that I had studied at my business school were actually real-life examples from that very organization. And now I was part of it – what a great feeling!
I realized very quickly though that what I had learned in business school, namely that all resources are allocated efficiently within an organization did not always hold true in real life, not even in the best companies. Even in this leading-edge organization certain actions and activities did not make any sense from an effectiveness and efficiency point of view. I came to realise the gap between theory taught at universities and what was indeed happening in day-to-day business life.
One of these gaps which I retained very vividly as example of inefficient behaviour was the absurdity of phone usage and its allocation based on seniority and not on the actual job requirements. An efficiency gap that manifested itself in form of the most infamous phone accessory of probably all times: the Blackberry holster. Awarded and worn as insignia of rank and status. Similar to the wild west where you could tell from the gun holster of a man its wealth, status and social rank.
Let me take a step back and explain.
The company that I joined in 2008 operated under a certain policy for communication equipment, phones to be exact. Devices were allocated according to seniority and rank in the company. The lowest rank in procurement, a functional business expert, was allocated a desk phone. Procurement managers, up to 5 levels above that expert, were given a basic Nokia mobile phone. Procurement group managers, 2 levels above the procurement manager, received a Blackberry phone. I was lucky enough to start as a procurement manager and hence was “awarded” a Nokia phone, which was pretty much what Nokia phones always were, a mobile phone that could be used to make calls only (strange, I know).
What I did not understand was despite the fact that my group manager (with his Blackberry + holster) was doing a very similar job to me, I received an inferior set of tools to do my job in the best way possible. Arguably my manager dealt with larger suppliers, had greater responsibilities and expenditures to manage. But ultimately, we both overlooked global supply chains of raw material flows from Latin America, the US and Europe to productions facilities around the world. We both were part of a small global team that was based in hubs in the US, Europe and Asia. Which meant, since we sat in Europe, on our way into the office we would catch up with Asia before they left work and on our way home we would join conference calls with the US, just after their lunch break. The email flow would be constant, 24/7, since there was always someone in your supply chain (internal customer or supplier) that was awake and needed your involvement. How to manage that with SMS and in 140 characters per message only, always remained a miracle to me. As did the answer to the question of: Why was I held back in delivering the best job I could do? Why was a resource that would make my actions more efficient being withheld from me?
Inefficient resources allocations in businesses.
These and similar issues are frequently being raised in many businesses that I see through my consulting work today. Many companies struggle with efficient resource allocation and most of the times it is for no good reason. It is obvious that communication technology in particular is the key enabler for an organization, elevating teams’ capabilities to develop new ideas and speedier solutions for their markets. Why are certain levels of employees restrained from making their own lives easier and their jobs more efficient then? Sure, resources are constrained by cost and this will always be a point to take into consideration. But facilitating efficient communication is key for any business and should be fostered throughout the ranks.
I believe the main reason for inefficient resource allocation in companies in this particular area of technology and gadgets is the perceived or real urge to differentiate between employees, and in particular to differentiate between seniority levels. In my view though most of these differentiations exist rather to address egos or as I would put it, insecurities of people. To showcase that you belong to a certain cast within your business seems important to many employees. Some other examples of this differentiation phenomenon that I came across throughout my career were canteens and catering areas that were split by management and non-management levels, travel policies of what hotels to use, what car to hire or if you can or cannot fly business class. The ability to work from home or not, or if you are allowed an iPad or not. Even free coffee and drinks are allocated by seniority levels at times.
What is clear is that resources in a company should be allocated in a way to get things done in the most efficient way possible to meet and ideally exceed your customer expectations. Company resources should be used in the most efficient way as your stakeholders and investors would expect it from you to drive most return on investment. Successful companies assume this principle and allocate resources based on job requirements and nothing else.
The reasons behind the Blackberry holster.
Egos and insecurities were behind the Blackberry holster phenomenon in my company at the time. Managers and senior leaders found it difficult to show their ranks in day to day interactions. Everyone was addressed with their first name, the office building that was open plan, no private offices or dedicated desks. You could sit next to a Director or VP one day and an intern the next day. Everyone was approachable which made it a great work environment to get things done quick. Maybe that was the reason why phone equipment developed, non-intentionally though, into a way to show rank, to satisfy the egos of some managers by allowing them to showcase their seniority, awarding them the batch of a blackberry holster that left just enough space to show the blinking red light on its top signalling incoming messages (if you receive messages you must be important). You could clearly tell on the corridors who was at least a group manager – the blackberry holster became the point of differentiation and who was at the bottom at the chain, namely the one that used a desk phone. Was this efficient? Clearly not! Was it intentional? I don’t think so. But it developed into a segregation of rank and status on its own, maintained by managers defending their privileges by not allocating equipment based on needs but based on seniority.
As for me, I received a Blackberry (with a holster) six months after I joined the company and after many discussions with my management. I simply could not do my job properly with not being available out of office hours. It took my direct manager and I a while to convince our management team that this was important to me and indeed business critical. Shortly thereafter the company started to allocate IT and phone equipment based on business needs and no longer according to rank. The Blackberry was replaced with iPhones and with it the infamous Blackberry holster disappeared.
I am still grateful of having started my procurement and supply chain career in that very company. It was and still is a great school for business acumen and best practice with high standards in procurement. What I learnt is that even in the best organizations in the world you will find structures and habits that just do not make sense and digress the company focus on what matters most: the customer. To address them and to improve how people work together to delight the customer is key for business leaders. That is was I learned for life.
What happened to the Blackberry holster that I received at time, you might wonder. I never wore it. I always wanted peers, reportees and colleagues to respect me for my work and the results that I delivered and not for the blinking red light coming from a holster on my belt.
Written by Jens Hentschel, Founder & CEO of THE FIVIS PARTNERSHIP. The Consultancy That Gets You Your Oomph back! www.fivis.io