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In business, trust -- but verify

As a leader, how do you know what’s going on in your organization? I believe this has always been an important question in organizational effectiveness, but is a particularly interesting question in our current environment.

Harry Truman was president of the United States of America for several weeks before he was fully briefed on the atomic bomb, so you can’t know everything immediately. Joseph Stalin knew about it long before Truman. (Maybe Joe was listening in on Harry’s mobile phone?)

If we believe current headlines, President Obama didn’t know we were listening in on some of the most powerful people on earth. He also apparently didn’t realize how far off track the Affordable Care Act’s implementation was, perhaps his biggest political accomplishment and signature project.

Imagine this in a business setting: You’re running a company which has illegally tapped the phones of the CEOs of your biggest competitors or allies. Do you think you’d know about it?

What if you’d recrafted your business strategy and one of the critical initiatives, perhaps the most important to your success, was launched with debilitating errors. Should you have known? Should you have realized that there was great confusion about who owned the project?[1]

Regardless of your political orientation, when you put this into a business context, I believe your management practice must allow you to know the critical elements of your business. You also need processes to verify the trust you’ve placed in others. Further, you must have clear project ownership.

In the past few months, I observed numerous situations in companies where executives didn’t have processes and practices to know what was going on — not at a granular level but at a macro-strategic level.

Either inertia or momentum can be dangerous properties in an organization. How do you ensure that strategic initiatives are owned and on track?

The further up the organization you go, the more people tell you what they think you want to hear. Are you sure you’re getting the truth? Do you have processes to verify what you’re hearing? As Ronald Reagan said to Mikhail Gorbachev regarding arms negotiations, “Trust, but verify.”

To paraphrase the bumper sticker, “Stuff Happens.” In large organizations, lots of stuff happens! As one of my early fight instructors told me many years ago about preparing for a flight test: “I know that some of this detail is somewhat irrelevant. Forget about it. Just remember the stuff that’ll kill you!”

[1] “We don’t know who made the decision, when it was made or why it was made.”

—Healthcare executive addressing Congress about the website debacle with Obamacare

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Todd Ordal

Todd Ordal is President of Applied Strategy LLC. Todd helps CEOs achieve better financial results, become more effective leaders and sleep easier at night. He speaks, writes, consults and advises on issues of strategy and leadership. Todd is a former CEO and has led teams as large as 7,000. Follow Todd on Twitter here. You can also find Todd at http://www.appliedstrategy.info,  303-527-0417 or todd@appliedstrategy.info

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