Editor’s note: Andy Drake is owner of The Drake Partnership, Newbury, England.
“The single greatest advantage any company can achieve is organizational health. Yet it is ignored by most leaders.” – Patrick Lencioni
I read this quote well over a decade ago and – along with other viewpoints that resonated – my personal experience supported the view. But the reason many leaders don’t put sufficient store by the importance of health is that it’s not particularly “sexy.” Organizational health requires a real senior commitment and rarely gets the same attention as the latest shiny new toy. Yes, technology and innovation are vital. But healthy companies know you need both.
The number one business challenge is simply to get the best out of people. Most companies are wrestling in highly unpredictable and uncertain times to find, retain and develop great talent. At the same time, people are re-evaluating what they want from both work and life. In parallel, change is constant and inevitable, be it technology, process, geographical focus or acquisition and people are the key to success.
I believe building health offers a great opportunity for companies but only if they make a clear and conscious decision to lead with an authentic people-first strategy. A truly healthy organization will drive ever better results. It’s a serious and rewarding undertaking that requires a different emphasis for the company, senior leaders and people. Communication is central, making work clearer, more purposeful and balanced. The opportunity and pathway to develop people will ensure companies that commit will outperform their peers. The cost of not doing so is replacing people, losing talent, lowering productivity and missing targets, and this should not be an option.
What is organizational health?
Organizational health exists when a company is both smart and healthy. Smart requires having clear strategy and good products, services, technology and financial management. Healthy is different, and arguably less tangible, but provides clarity for people’s work and recognition of their contributions, while also improving morale and minimizing politics and turnover.
It sounds easy but it requires senior leaders’ dedication, high levels of trust and complete clarity of what a company is aiming to do. This drives energy within people. They feel that they are valued, and when people grow, the company grows, all in a sustainable way. Depth and breadth of leadership grows too. People love their work and really enjoy working for the company.
This is very rare and it requires real commitment. Success requires health at the personal, team and company level. And crucially, it is not “soft” – people in the business who don’t behave in the right way need to be developed or removed, whatever their contribution to the bottom line. Businesses can become unhealthy quickly (Twitter a good recent example).
Another aspect is the physical and mental well-being of people in the business. Reciprocally, you want your business to be smart (physical) and healthy (mentally).
8 ways organizations exude organizational health
I interviewed Janet Leighton, director of happiness at U.K. retailer Timpson Group, an organization that operates in day-to-day areas like key cutting, shoe repair and photo processing. It is an organization that exudes organizational health. We landed on eight golden themes that make the company healthy:
- Commercial focus. The culture is not soft or fluffy and is commercial. Timpson is dynamic, quick and onto the next thing.
- Upside-down management. The company works with servant leadership. It’s fiercely commercial, dynamic, ambitious and fair.
- Personality is king. Timpson recruits for personality. Leighton said, “You can’t train personality, but you can train the job.” The internal view is that 95% of people in the business are superstars.
- Leaders provide support. This support covers a huge range for colleagues, from traditional things related to the specific role as well as help with finances and emotional well-being.
- Clarity. Organizational clarity and communication shine through – the need to actively listen, solicit feedback and act upon it. For example, Timpson only has two rules in addition to normal health and safety regulations.
- Building resilience. Going forward, the business wants to further support people in the area of resilience by spending time, sharing knowledge and actively listening.
- Actively listening. Active listening is the norm and it’s a true customer- and colleague-led business.
- Freedom to deliver. Timpson is about creating trust and freedom. Create the right conditions, support whenever and wherever and don’t get in the way.
How to develop organizational health
Every company is different, so the first step is measuring where you are. With that in mind, I have developed a five-minute survey that covers 20 metrics that can be laddered to cover five core areas:
- Culture.
- Organizational clarity.
- People.
- Communication and transparency.
- Reward and recognition.
It’s key to determine where you are before identifying the priorities to improve on. This reality check is crucial and can sometimes be uncomfortable.
Here are three key questions to ask:
- How can we help individuals develop?
- How can we support teams to perform more effectively?
- What can we do to ensure that the important aspects of strategy are successful?
From there, work with leaders to design a program that involves key people across the business and focusses on building organizational health.
What does organizational health mean for your people strategy?
It means a shift in emphasis from a product-led strategy to as people-led strategy. The other aspects of business growth are still crucial, but people must be at the center. The knock-on effect has significant implications for leaders as they need to increasingly contribute more to the people strategy and lead by example on organizational health. They need to invest more time in communication with people to provide clarity, to bring a sense of belonging and purpose to people’s work and identify future stars.
Leaders need to take stock and take employee and company health very seriously. They must be open to change and encourage deep and truthful feedback that can start the process of focusing on health. In my own experience, even healthy companies have pockets where work is needed. As with most things, it starts with a conversation.