Mike Lehr's Blog

The Freedom-Order duality expresses a dimension of our personality involved in interpreting how we balance freedom and order. It can help us – in real time – understand, appreciate and predict better the reactions of others to such things as processes, decision-making, management, customer service, change and organization.

However, all of this is arbitrary, subjective, meaning different people are comfortable with different levels of freedom and order. To some freedom is chaos because it seems anyone can do whatever he wants. To others order is slavery because there is someone or a rule telling her what to do. Therefore, since there are no absolute states for either, you can be the benchmark as the figure shows. This allows you to assess whether people are more freedom-oriented or order-oriented than you are by the feelings and thoughts they trigger in you.

For instance, more freedom-oriented people might make you feel they are:

You might also notice they tend to use words such as these:

By contrast, more order-oriented people might make you feel they are:

Similarly, you might find them using words such as:

In our daily business lives, this means adding process and procedures to those who are more freedom-oriented than we are might stir anxious feelings about becoming nothing more than an automaton. Conversely, more flexibility and options to more order-oriented people might trigger anxious feelings about what is the right thing to do.

Once we are sensitive to this, we can better position the change by adapting immediately to what we observe in others. To the freedom-oriented people, we will need to reassure the flexibility of adding their own dimension, and to order-oriented people reassuring clear definitions of their duties will exist. In essence, we personalize our approach and words to by appreciating people and their needs better.

The article, Now You Know, in the May 28, 2011 edition of The Economist discussed a study published in Cognition by Elizabeth Bonawitz of the University of California, Berkeley, and Patrick Shafto of the University of Louisville regarding the directing of children in their play. The conclusion is that prior explanation of how to play inhibits exploration and discovery.

Developmentally, businesses, through their everyday managerial practices, tend to instill a resistance to change in their people. They do this by excessively directing their people what to do. This direction not only comes via communications from managers but also procedures managers established. Consequently, employees don’t need to think; they just do as told.

As with any task, practice reduces anxiety of doing it. Uncertainty is no different. To become more accepting and adapting of change, employees need exposure to uncertainty. They need to explore and discover. Reiterated more pragmatically, they need to try and err. However, this requires time and money which is intolerable in most business cultures.

Therefore, managers need to look for tasks and projects that require thinking, exploring and discovering by their employees.  For example, assigning tasks requiring unique customer solutions would help. This could mean simply writing a letter to address a unique customer inquiry. Tasks involving working with people of different personality types work too. Creating a new process or set of procedures is good. Any task where the method or solution isn’t pre-defined or one of several works will help.

If you want to encourage your employees to have a change mentality, you need to give them experience in dealing with uncertainty. It means giving them time to explore and discover, to try and err. It means encouraging them to think for themselves rather than telling them what to do.

A person who direct messaged me on Twitter suggested I address cooperation and competition on the business-to-business level (B2B). Which is more profitable?

Generally, cooperation will tend to be a better business relationship than competition on just about any level, business or individual. We are social creatures, so we join groups to cooperate with others for mutual benefit. People will tend toward cooperation.

However, in reality, sometimes people cannot cooperate as they would like. Rules, policies and regulations sometimes make it wrong, illegal or expensive. For instance, governments do not allow businesses to cooperate in fixing prices and setting markets.

Where’s the proof that B2B cooperation is profitable? Look at the free market. The mere fact that governments have to pass laws preventing cooperation among businesses indicates that businesses can find it extremely profitable. If cooperation weren’t profitable, would we have to pass laws to prevent it? Furthermore, just look at the legal forms of cooperation in the forms of trade associations and lobbies. Would such cooperation occur if it weren’t profitable?

When businesses engage in competition, it’s like war: uncertain and expensive. Cooperation provides certainty and cost-containment. However, governments don’t allow this because it’s bad for consumers. This is similar to the Roman Emperor who forced two gladiators into mortal combat so he can entertain the crowd. What would happen if the two cooperated and did not fight? That’s why the Emperor had to say both would die if they didn’t.

The whole point of this analogy is to demonstrate that sometimes it’s very difficult to see the profitability of cooperation because many times we establish rules, rewards and penalties to ensure competition rather than cooperation. It becomes even more difficult when we benefit from the competition of others. The difference is often our perspective.

The power someone has as a leader in an organization is a function of 1) the authority it gives him and 2) his personal influence within the organization. The former is formal organizational power (FOP) and the latter informal organizational power (IOP). Figures 1 and 2 help us visualize their difference.

Figure 1: Formal Organizational Power

The importance of IOP becomes more apparent if we view leadership beyond a management context. For instance, one client expanded its definition from those in management to those who could initiate and develop new services, those who could grow existing services and those who could find and develop new customer channels.

The source of IOP varies by person. It could be his expertise, knowledge, experience, achievements, attractiveness, personality, education, intelligence, relationships, character, talents, skills, abilities, credibility, reliability, judgment, wisdom, seniority plus many other things. I knew one machinist who was a leader because he could run more of the machines in the plant better than anyone could.

Figure 2: Informal Organizational Power

FOP gets people to do things because they must; it’s the rule. IOP encourages people to do things because they want to; they like those with IOP or do so out of respect. Using a body as an analogy, FOP represents the bones and IOP the muscles. The most powerful leaders have a lot of both; organizations give them a lot of authority and people within the organization have a strong desire to help them.

Thus, when we try to understand and appreciate how organizations work, looking at the organization chart shows formal organizational power. Overlaying this chart is the influence of a multitude of relationships that vary by situation and by moments in time. In effect, we don’t really know an organization unless we have a feel for how informal organizational power influences it.

Related Link:

• Leadership vs. Management: The Difference (Part II)

Figure 1: Formal Organizational Power

I continue to receive a steady stream of visits to my original post on this topic, so here’s a follow up. As I mentioned previously management is to leadership what a house is to home. Developing the relational aspects of leadership will further help to define this difference. Let’s begin by looking at two broad types of power in an organization: formal and informal.

The first is the authority given to each job function by the organization as represented by the organizational chart (Figure 1). A job’s title, position in the hierarchy and stated responsibilities give this authority. Thus, people will listen and accept another simply because those are the rules.

The second is the personal influence each person exerts on every other person (Figure 2). In business, we frequently see this as someone having a particular expertise, experience, personality or quality that encourages members to listen and accept him.

Figure 2: Informal Organizational Power

Therefore, while formal power remains the same no matter who has that job (unless the organization changes the rules), informal power varies depending upon the person who is in that job. Often we perceive this as credibility: How much credibility does a person have in the performance of that job?

Management is more about the use of formal power and leadership informal power. Formal power relies upon organizational structure just as a house is a structure. Informal power relies upon personal influence just as a home’s ambiance influences us. Just as two houses can have the same structure but feel differently as homes, two people can have the same jobs but the influence they exert upon others will have a different feel.

In simple terms, management is about using authority well; leadership is about using personal influence well. The latter makes an organization . . . a team.

Other links in this series:

• Leadership vs. Management: The Difference
• Leadership vs. Management: The Difference (Part III)
• Leadership vs. Management: The Difference (Part IV)
• Leadership vs. Management: The Difference (Part V)
• Leadership vs. Management: The Difference (Part VI)

This past month, I conversed with a resident of a Muslim country. He commented on how many of his fellow citizens couldn’t understand why Americans thought they were free. “They have all these laws directing them. They can’t drive as fast as they want and they even need the government’s permission to drive (licenses).”

Coincidentally, the December 16^th 2010 edition of The Economist reported on driving in Iraq. It’s true, at least there, that Iraq has far fewer driving restrictions than the United States has. It doesn’t even require driving licenses. However, driving there is dangerous. In fact, “the health ministry estimates that six times as many people now die in car accidents as fall victim to political violence.”

I also ran across an article about choice in the same issue. “Too much choice, concluded Sheena Iyengar of Columbia University and Mark Lepper of Stanford, is demotivating.” The article went on to suggest that this is from the anxiety people often feel when making decisions; too much freedom of choice increases anxiety.

There are people who seem to prefer less, and almost no, freedom in their work. They prefer clearly defined directions, rules, policies and procedures dictating their thinking and actions. Why? I have come to learn that this produces a different kind of freedom for some: freedom from responsibility. How can we be responsible for decisions we did not make or regulations we did not write? For some it also produces certainty; they know what the “right” decision is.

As the diagram to the right asks, “When does more freedom become chaos and uncertainty to us?” For each of us, that varies. For some of us, it restricts freedom so much that it might not even seem like freedom anymore. So, is freedom for everybody?

A CEO of a 150-employee services company made this astute observation: processes reduce the need for top talent, and thus, reduce labor costs. This company requires highly talented professionals to deliver its services. Historically, management allowed them to work without defined processes because the employees knew what to do. However, as the company grew, finding such talent became harder and more expensive.

Processes become the path to training and developing in-house talent. They are analogous to painting by numbers or following recipes in cooking; they improve the output produced by individuals who don’t have a grasp on the entire work. However, just as we wouldn’t confuse painting by numbers with being an artist and following a recipe with being a chef, we shouldn’t confuse executing the steps of a process with being talented. Processes allow the breakdown of a task without necessarily needing to understand the task itself. It’s like following a series of directions; you don’t need to know your destination.

Since an employee doesn’t need to understand the whole task to follow a process, he does not need the talent that that understanding requires. Essentially, the process is making the decisions for him as embodied by its rules and procedures. As a result, the company does not have to pay a premium for that talent.