The Dark Side of Systems

With a company name like, Wired To Grow, you think I’d be a fan of systems (and you’d be right). There’s no way for you and your business to scale apart from creating lots of them. Now, technically, everything is a system, including randomness or “flying-by-the-seat-of-your-pants” but you know what I mean when I use the word, “systems.”

Moving from the place of actions built on one-offs and the intellectual property and/or efforts of a person to that of actions built on tried and true systems that can produce predictable and repeatable outcomes regardless of the person implementing them is essential to creating a fast growth company (and getting your life back as a business owner or entrepreneur).

However, just like everything else in life, there is a dark side to creating systems that those of us who like them rarely talk about. Just as caring about people can be a strength, it can also be a leader’s weakness. Likewise, the ability to make decisions apart from being driven by how others might respond is both a strength and a weakness.

In the case of systems, there is a similar problem, and we’ve all run into it. For example, how many times have you gone to another business and asked for something that made complete sense to you but the person on the other end of the conversation (often referred to as a customer service agent, which frequently feels like both a stretch and an unethical use of the term) says, “I’m sorry, but that’s not our policy.”

Now, we all know how those policies get created. No business operating in multiple locations with lots of employees who are all interacting with different customers can deliver a consistent and predictable level of service and support apart from creating policies that inform their employees, “Do X when Y occurs.” Intellectually we all get that. Rooting out randomness is the key to creating a consistency of experience.

I. The Dark Side Revealed

But, the very things that make systems so powerful (consistency and efficiency, for example) are also the very things that undermine systems (the inability to deal with one-offs, for example). Les McKeown, in his classic book, Predictable Success, uses three words to describe what I call the dark side of systems, the lack of creativity, initiative and risk-taking. I think he’s right on.

Anyone who’s been on the end of “but that’s not our policy” understands those three words. You want to scream at the customer service agent and say, “Use your brain! This makes sense. Show some initiative. Take a risk. Make this right. There has to be a creative solution to this problem.”

In other words, the dark side of systems is that, when executed properly, they can be self-defeating. The very creativity, initiative and risk-taking that created the system in the first place has become institutionalized and no longer provides the implementor the freedom to use the three traits that originally created the system.

This has applications everywhere, including education (a side rant worth thinking about), since “Common Core” is a hot topic these days. I grew up in New York State back in the late 70’s where the Regents exams ruled everything. From September through February, new “learning” occurred. Then from March – May, all we did was take tests to prepare us to do well on the Regents exams so that our school would look good (meaning the superintendent and principal).

Now, I have no problem with setting up core knowledge that every educated person should know (a la Ed Hirsch and Cultural Literacy). For two adults to have an educated conversation, there has to be common cultural knowledge. My problem is that when the core becomes too important, the more important things that led to it (like creativity, initiative, risk-taking, along with minor issues like learning to think or reason, or understanding how to develop a cogent argument or compose one’s thoughts on paper, etc.) are all eliminated.

II. The Death Spiral For Your Business

The implications for your business are huge. When consistency and maintaining the current system drive an organization, death is on its way. As you’ve heard me say many times, “Everything in life moves from remarkable to ordinary to death.” Any time the system becomes the driver, especially over time, death is on its way.

What allows any of us as small business owners and entrepreneurs to keep growing is our ability to innovate and stay ahead of the curve. When maintaining the current system becomes the dominant driver, innovation is driven out. Creatives leave. Initiative dries up. And risk-taking heads to the hills. No business can consistently grow when it’s drivers have all gone underground.

To get to the next level, you need people who not only are creative, but are willing to unleash it inside your business. You need people who are willing to take initiative to make changes, fix problems, create new solutions. And you need people who are willing to take-risks and try things that may either succeed amazingly or fail miserably.

However, if you let your current policies, procedures and systems rule your business, you’ll end up running face-to-face into the dark side.

III. The Solution Out of the Dark Side

So, how do you avoid the dark side? Here are a few thoughts.

1. Stay vigilant against the dark side

There are several things every great business leader needs to do, but one of the most important is to stay vigilant to the core principles and values that can drive that business. Someone has to step back, look at the big picture, and evaluate, “Is what we’re doing going to catapult us into the future or turn us into a once-great company?”

Being aware that there is a dark side is half the battle. The other part is fostering a culture of creativity, initiation and risk-taking. No one else can do that as well as you can. So stay vigilant. Don’t allow the drive for consistency to get in the way of fostering an entrepreneurial culture that will keep you on top.

2. Cast vision for and reward creativity, initiative and risk-taking

If you’ve followed me for any amount of time, you know that one of my favorite quotes is “Reward excellent failures, punish mediocre successes.” As the leader, you get to set the culture. And culture is primarily set by example, story, and rewards. So cast vision for creativity and innovation. Find great examples. Lift up employees who show initiative and take risks. And make sure that those who demonstrate the big three, get rewarded for it (in multiple ways). As you know, what gets rewarded, gets done.

3. Create a culture of iterations

While the front line needs to deliver a consistent experience, make sure you and your team are always working on the next iteration. So, while the front line is delivering v. 1.0, your team should be working on v. 2.0. Once v. 2.0 is in place, make sure your team IMMEDIATELY starts working on v. 3.0.  This not only keeps you on the cutting edge, it reminds everyone that today’s system isn’t perfect. Frank in Tulsa, running into a new customer problem, that the current system doesn’t adequately solve, needs to feel empowered that he might be the one to create the next iteration. A culture of iteration creates that sense of empowerment.

Systems are essential to every scalable and fast-growing business. But if you want to stay on the cutting edge and you want to deliver superior service, make sure you protect your company from the dark side of systems (eliminating creativity, initiative and risk-taking). Instead, stay vigilant, cast vision for and reward the big three, and create a culture of iteration. If you do so, you’ll not only reap the rewards of consistent and predictable outcomes, but you’ll be creating the kind of innovative culture that will keep you on the fast growth track for years to come!

To your accelerated success,

P.S. If you’ve noticed some other dark sides to systems (or have some ideas that could help the rest of us avoid the dark side), make sure you add your ideas to the comments section below (or click here >> if you’re reading this by RSS or email).

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