Oblique influence

I just finished a long section of Getting Health Reform Right about the role of regulation in health care that was, to say the least, eye-opening. And as usual, I want to leave aside discussions of health reform and talk more about the implications for leadership generally.

My biggest take away was that changes in health care can rarely be legislated directly: if you want to lower the costs of services, it’s not feasible to just mandate lower costs; if you want more people to seek preventative care, you can’t make a law that they do so; if you want better providers in under-served communities, you can’t just tell them to go there. This kind of direct approach will ultimately fail, either because the link between cause and effect is too complex or because compliance with the law is difficult to enforce.

Instead, changes in health care need to be legislated obliquely, through things like financial incentives, marketplace regulation, and social marketing, all of which are aimed at creating an environment that encourages the system to reach the desired end state (lower costs, better utilization of preventative care), rather than forcing it into that end state.

And it occurred to me that corporate leadership requires an analogous use of oblique influence. As a CXO, you can’t just mandate an end state, you have to set the stage for it and encourage the organization to move in that direction.

If you want improved financial and supply chain processes, you can’t just make it so by fiat…or even by throwing lots of money around buying and implementing a big ERP solution. You need to institute a range of changes that indirectly get at the end-state change you want, so that all the money and political capital you spend on that big ERP implementation pay off in a transformed organization.

If you want improved relations between IT and the rest of the organization, you can’t just mandate a process that governs the interaction between the two, with forms, process diagrams, and protocols for both sides to follow. Because in the end, the problem is not the lack of process, forms, and so on; it’s a lack of trust, communication, and shared vision–and these things can’t be directly created in one fell swoop; they need to be fostered gradually, over time.

As always, would love to hear from folks out there who have thoughts, criticisms, other ideas, or experiences to share–jump in and let’s get the conversation going!

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2 Responses

  1. You are SO right in this statement: “If you want improved relations between IT and the rest of the organization, you can’t just mandate a process that governs the interaction between the two, with forms, process diagrams, and protocols for both sides to follow. Because in the end, the problem is not the lack of process, forms, and so on; it’s a lack of trust, communication, and shared vision–and these things can’t be directly created in one fell swoop; they need to be fostered gradually, over time.”

  2. Jolanta,

    Thanks for the kind words–I appreciate it!

    Cheers,

    Joe

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