Leadership for “organisational-fitness” is different from leadership required for “organisational- wellness”
Organisational fitness is being capable to do the job efficiently and creating growth but fitness does not equally deliver effectiveness, sustainability or long-term survivability. The latter being characteristics of organisational wellness. Best outcomes require both fitness and wellness, however, fitness is easier to deliver, measure and reward. Balancing the ease of short-term measurement with long-term consequences is a critical task for leadership.
“Fitness” in human terms is a means of doing repetitive exercises with the aim of maintaining or improving physical condition, it is focused on physical health. We can measure a person’s level of fitness. “Organisational Fitness” is an approach to understanding current efficiency and performance of the company based on qualitative measurement. Organisational fitness provides metrics for the critical areas of systems and processes and through KPI’s enable management and reporting by comparison.
Fitness is seen as physical exercise to gain strength. Strength is gained from repetition but we know that strength gained by repetition can it can equally result in the reduction or loss of flexibility. Indeed strength may be gained only in a single dimension. Elite sportspersons are specialists and know that they train to be the best for the demands of their sport, which does not mean they perform well in all sports. Companies with highly automated and repetitive processes can be fit for purpose, highly efficient and outperform others but equally be brittle, fragile and stiff. Being an elite company in one sector does not mean your processes translate well to other sectors.
“Wellness” in humans terms, has a complex dependency on combining body health, mental health and a current emotional state. The determination of wellness or well-being takes into account how these concepts are balanced for good outcomes, based on experience and expertise. Whilst measurement of fitness is understood, measurement of body health, mental health and emotional state are subjective and less quantifiable. Trying to determine “Organisational Wellness” has the same subjective qualification. Organisation-wellness unpicks team, culture and behaviours to determine if when combined together the company has the capacity, capability and focus to continue to succeed in the long term.
Human Wellness is not Fitness!
Fitness is focussed on being physically well (healthy), however, there is no assessment of your mental state or stress level. Wellness determines how you cope with all your mental issues and can help define a lifestyle that invigorates your soul. Wellness is more of a translation of your internal states in coping with the situations of life but does not mean you are fit.
When a person puts in physical efforts or any kind of physical activity that helps them stay in shape; this is fitness. Fitness programs solely indulge individuals in achieving the marked standards of a physically fit body like weight, fat content or BMI. It should include a specific diet planform a proper nutritionist to maintain and improve the physical health of a person. Wellness being about raising a person’s self-esteem, driving the person to find motivation within themselves. A Wellness program helps improve the intellectual abilities of a person which in turn encourages the sense of being physically fit.
Fitness often becomes performance based on measurement of the weight, reputation or time, the higher the efficiency the more brittle or fragile the person becomes to anything outside of the demanded routine.
Wellness can become a defence, protection and the ability to cope. The measure of wellness is judged externally by others as happiness, contentedness or peace as we have no ability to grasp what is actually going on in the mind. We determine that actions are a correlation to the state of the mind. But coping and appearing content is not a true sign of wellness and wellness is not a sign of fitness.
Organisational Fitness is not Wellness
Fitness for purpose is the concept in which a company, product or service is adequate for the purpose for which the stakeholder, buyer, user, consumer selected the offer. Achieving fit-for-purpose in each context is difficult but can be measured and improved. Business owners and creators of products and services need system and processes for understanding needs and to be able to deliver. Being fit for purpose does not determine anything beyond the short term demand or alignment. Organisation-wellness focusses on the team, culture and behaviours to determine the company has the capacity, capability and focus to continue to succeed in the long term. Organisational fitness is efficiency or efficacy whereas, wellness is effectiveness or purpose.
Organisational wellness determines how the company will cope with externalities that bring stress and strains. Wellness is more of a translation of your internal states in coping with the situations, complexities and market changes that you are unable to control.
When an organisation puts in the effort to become more efficient; this is improving organisational fitness. Efficiency programs indulge companies in achieving the best industry metrics and standards and focus teams to raise the bar that drives better outcomes for certain parties. Wellness being about an organisations purpose, mission and values drive the team to find a north star and then guide the organisation towards it. An organisational wellness program helps improve the abilities of leadership and staff to cope with market conditions, determine better outcomes and be better ancestors, which in turn encourages the sense of balancing a drive for efficiency and effectiveness.
Organisational Fitness often becomes purely performance-based and dependent on the measurement to program KPI’s, often without any consideration of the unintended consequences of any KPI or a combination fo KPI to drive behaviours. Higher efficiency demands better integration and this increased the brittleness/ dependency on other parties. As we move to more automation and an increasing dependency on data, ML and AL efficiency is a target, however, this same drive can be seen to make the system and processes more fragile to systemic shocks, which were so rare we discounted the risk to zero. Enter a pandemic.
Organisation wellness can become a defence mechanism and self-repairing protection, setting-up the ability of a company to cope with significant externality shocks. The measure of wellness is beyond tricky, highly subjective and often driven by a particular political/ personal agenda but that does not mean we should not try. We can determine wellness over time and from past experience, but determining it right now is hard. This is where leadership and governance come into focus as skills. Critically is why some senior executives often fail to cross the chasm from being top of their game in the efficiency and KPI measurement world to the governance and oversight demand that a board requires.
Leadership for “organisational-fitness” is different from leadership required for “organisational- wellness”
There is a change in focus and requirements between being a senior team member and a director which is illustrated below, the Director being on the right and senior leadership on the left.
The behaviour of management is described by the blue diamond. The is a task to be completed, and there is an incentive to complete it and do it in the most efficient way. The motivation is a reward (money, profile), and we have a look of a driven professional who delivers the KPI’s. In this blue cycle, the outcome is achieved by the people in the system backed by the process.
The green diamond represents a system where everything is connected, each creating a dynamic dependency on everything else. Whilst the blue diamond orients towards employees, the green towards Directors. The point is that the blue diamond operating system trains for efficiency and does not train or develop skills for operating in the green diamond environment, effectiveness.
Back to skills needed for directors
The chart below shows how skills should be formed over a period to create individuals who can work together with other professionals who can deal with highly complex decision making (judgment). The grey areas are where the “Peters Principle” can be seen in practice; individuals act outside of their capacity and/or are not given sufficient responsibility and become disruptive.
The yellow/ mustard zone is where many senior executives get trapped as they are unable to adapt from acting in their own interests (blue diamond) to acting in the best interests of the organisation and eco-system (green diamond) as all their training is how to perform better in the blue.
Organisational Wellness
Organisational fitness is hard but relatively simple to measure, an organisations wellness is far more difficult. However, in human wellness, we have determined that our actions are a correlation to the state of the mind. Perhaps the takeaway from this is how we measure and report on Board decisions is far more critical than just another data set, but is rather an indicator of the wellness of the organisation and its ability to continue in the future. If we measure wellness we can also measure sickness and highlight decisions that prevent the organisation from becoming sick.