The MD’s dilemma - 14.05.12

The MDs dilemma

The managing director reported to the board that there was a significant skills gap creating a problem for the organisation.

The managing director however, did state that the organisation was not alone in this. Apparently nearly eight in 10 firms admit to carrying a gap in their workforce skills.

The board told him to fix it.

As the old saying goes, “little did he know”.

As he started to develop a solution to the problem, he came across more and more information that sometimes reassured him, (such as when he found out that some of the bigger companies in his industry had increased their workforce . But they had not increased the number of project managers  to look after the projects being delivered, meaning that he wasn’t alone with this problem), to then finding out that those same companies had come unstuck when the companies were found guilty of corrupt conduct, delivering  substandard products and services, and generally losing much credibility.

He found out that “only one in five of the 1685 business executives and professionals surveyed said their organisation had a program in place to access the skills set of employees who had retired from the business.” Again, because his organisation didn’t really have much in place in relation to this  He felt reassured that not many other organisations did either.

Along the way, he discovered many other frightening things.

He found out that the cost of keeping older employees, was prohibitive, when a lot of them wanted to retire. He found out that managers in his company ignored the advice of those with years of experience. The Board never got to hear of any initiatives proposed by the “old and bolds”.

He found out that people were promoted into roles where the reason for the role was not entirely justified. The role existed because it is said that the span of management should only be three or four subordinates for any manager. ( Thus perpetuating the need for heirarchical management structures) . He found out that team based leadership was almost unknown in his organisation. He found out that the rate of turnover of employees was as great as or greater than the competitors in his industry. ( He thought everyone was OK. He didn’t spend much time “on the shop floor”, as he was inherently shy, and much more focused on targets, and the accounting side of the business. After all, the accounting stream accounted for more than 75% of all CEOs in his industry. There must be something in that)

He read an IBM study called “global human capital study 2008”. Participants were asked the question, “what do you see as the primary workforce related issues facing the organisation?”

The most important issue facing the organisation was the inability to rapidly develop skills to address current or future business needs.

He looked over what a highly respected  business commentator in Australia had said were his golden rules for success in this day and age. Outsourceing non-core activities, was one, and developing a unique organisational culture was another.

He did do something. See his brief presentation to the board here,

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