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Leadership

The Perils Of Ignoring The Softer Side Of Management

An overemphasis on the "hard" side of management, a carryover from the industrial age, can at best achieve a linear increase in performance. But a focus on the soft, non-linear side can lead to exponential growth.

There is a continuum in management between "hard" and "soft." The "hard" is the management that makes plans, sets up structures, and monitors performance. The "soft" is the people-friendly management based on emotions. The classic, modern dichotomy was shown by the switch of John Sculley in 1983 from the "hard," corporate world of Pepsi to Apple, which was based on "soft" management, and then, as Apple developed and investment bankers became involved and the company grew bigger, friendship went out of the window, management became tough and aggressive, and everything was about the bottom line.

The "hard" side is based on consistency, and in human resources this often works through demographics, by assessing credentials. Appointing senior managers is the most important aspect of being a CEO, and I have made many appointments that were considered unusual. I would say these "instinctive" appointments worked six or seven times out of 10. When they didn’t work, I admitted it and removed the people. The net outcome, though, was leaders who would not otherwise have been brought on board.

In practice today, the majority of managers, perhaps 90 percent, still focus too much on the task side, a hangover from the industrial age.

My own approach has been based on curiosity. My aim was never to reduce differences, but, rather, to celebrate them. In managing human beings, you manage emotions and passions. Indeed, optimize their passionate state in order that they deliver their best. That is totally non-linear: The mistake that 90 percent of managers and business leaders make is that they try and linearize the behavioral side by proceduralizing it.

In purely percentage terms, management in recent years has shifted from being overwhelmingly oriented towards task structure to being divided perhaps 50:50 between task structure and consideration. For me, task structure is 20 percent or less. The consideration part is 80–85 percent, and as CEO of Zain—the ex-state-owned telecoms operator with a base of 500,000 customers that we grew into an international giant with 72 million—I spent far more of my energy on the consideration side, which often surprised people.

When I first arrived at MTC, many joked that I was running a social club. Something similar happened even as Zain took off, because people often thought I was wasting my time: "Why does al Barrak spend 80 percent of his day talking to people about general issues and 20 percent on planning and strategy and so on?" The answer is that the best of plans and strategies are the ones extracted from the hearts and minds of your people, or inculcated in the hearts and minds of your people.

An overemphasis on the "hard" side, the linear part, can at best achieve a linear increase in performance. But a focus on the soft, non-linear side can lead to an exponential improvement in performance. Zain’s rise through seven years, from 2003 until 2010, was non-linear, and this could never have been achieved by following the precepts of conventional, linear, task-oriented management.

No company can work without a "hard" side, without structures and plans. When we acquired several mobiles licenses in our early growth years, or were deciding to outsource our supply-chain, there were many plans and structure.

There is always a tension in business between being transactional and being transformational. Transactional leaders make the organization more successful in getting things done, whereas transformational leaders take the organization from one stage to a completely new one. Some leaders are very transformational, revolutionary, and creative. Other leaders are transactional: They are good at putting processes, systems, and mind-sets in place. But the real challenge is being able to do both at the same time. The constant is the vision, as delineated in a strategy. Once you change your vision, you change your identity and become a new creature. Strategy is the execution of the vision, so even the strategy is temporary.

My philosophy is not based just on tolerating ambiguity and paradox, but sometimes on proactively creating them. Of course I took many decisions on instinct. But the management systems within Zain went all the way from the budget to setting specific objectives down to teams of three or four. The balance was unusual—perhaps 60 percent on culture and 40 percent on quantified "business" targets.

Optimal control is no control. If staff align their mission in life with the mission of the organization, and go about their life appreciating the complexities around this mission, that’s the highest level of discipline. They wake up and think: "How am I going to conquer the world today?"

What’s more, the continuums themselves shift. When we bought Fastlink, acquired the licenses in Bahrain and Iraq and won a management agreement in Lebanon, in a matter of two years we quickly became five companies rather than one.

Another continuum, that of external/internal, also changed as we expanded. The external coalition involves anyone external to the executives of the company, so it includes the board and shareholders. The leader should be able to align the external coalition with the internal coalition behind the mission, and so make sure the external coalition does not negatively pressure the internal coalition and hinder its progression to its objectives.

From the press to consultants, Zain developed an extensive communications operation, at the corporate level and in individual countries. When we made the big move to outsource in Saudi Arabia you could hear the sound of plans being torn up—music to my ears—for in a fast-changing world there continuums are always moving.

Companies which mistakenly try to make themselves more professional by taking everything linear, simply decide they want best practice. They look for best practice in the world and they try to copy it.

I say that best practice equals beast practice, because that’s what beasts do: They just copy each other. So that’s best practice in the corporate world? What makes you win is uniqueness, not standardization. For me this establishes a dynamic relationship between business transformation and turbulence. It is turbulence, and not stability, that is the steady state in business. Maturity is a journey, not a destination. A mature business is a stagnant, dying business.

Reality, especially in today’s world, is dynamic: Even if the structure suits the time it is created, by the time it has been put into practice that reality has already shifted.

This reflected the approach we adopted at Zain. We changed our architecture all the time, made decisions on the fly, and from the outset wanted to be super-flexible—"chaos by design." I wanted a company that could make sudden left or right turns without breaking its back.

—Saad Al Barrak the former CEO of Zain, a leading mobile telecommunications provider in the Middle East and North Africa.
He is the author of A Passion for Adventure: Turning Zain into a Telecom Giant.

[Image: Flickr user Yuri Barichivich]