1 Control in an Age of Empowerment

Tension between providing flexibility/innovation/creativity/entrepreneurial flair to empower employees do redefine

according to their best knowledge AND exposure to excessive risk and/or behaviours than damage the company’s
integrity which used to be controlled by constant surveillance (50’s) + standardization (still in use nowadays) but
expensive, inefficient; also by only relying on good people with right values: idealistic

 CONTROL (not only strict measurement of performance) VS CREATIVITY

o diagnostic control system (critical performance variables)
 keep critical performance variables within present limits to monitor goals and measure progress
towards targets periodically, allowing for fine-tuning/adjustments only
 can create failures (crises), as built-in danger (ex: audit control, false journal entries)
o beliefs systems (core values + purpose)
 articulate concise, value-laden, inspirational values/directions to inspire commitment
 how firms create value (best in the world), level of performance the organization strives
for (pursuit of excellence), how people should behave (respect)
 works if only values are deeply rooted (actually walk the talk), provide guidance
 more empowered/creative employees  augment diagnostic control systems
o boundary system (risks to be avoided)
 minimum standards (ethical behaviour, codes of conduct), should tell what to do  discourage
creativity or what not to do  allow innovation, but within clearly defined limits
 temptation, pressure to bend the rule to achieve “unwanted/undesirable” goals
 often instituted only after a public scandal/investigation, must be harsh/severe punishment
 also clear the field of possible clients/market opportunities to pursue, and other to avoid
o interactive control system (strategic uncertainties - managerial)
 if small: explore emerging threats and opportunities together, otherwise proper tools
 formal information systems to influence decisions in an action plans/react accordingly

2 Designing High-Performance Jobs

Four basic spans of a job:

 Control: “What resources do I control to accomplish my tasks?”

 o E.g. Nestlé – reformulate for each country/taste
 Manager regional – lots of control over pricing, distribution, sales
 Manager HQ: limited decision-making logistic, supply chain
 Accountability: “What measures will be used to evaluate my performance?”
o E.g. many trade-off – accountability; fewer trade-off – less accountability
 Initiative/take risks: broad metrics (market share, customer satisfaction, …)
 Compliance with standard operating procedures: narrow measures (employees, expense)
 More accountability than control: become entrepreneurs/stimulate creativity

 Influence: “Who do I need to interact with and influence to achieve my goals?”

o Wide: think outside the box, consolidate outside silos, counteract rigidity, cross functional teams,
 The more the complex/interdependent job, the wider the span should be
P&G quote: “The circle of influences should be greater than circle of control”
 Support: “How much support can I expect when I reach out to others for help?”
o Level of commitment from the other are required (low =