In a hierarchy, power moves down from their top. The focus of power is the allocation of responsibility to act to individuals and the management of their performance. Holding people accountable is a conversation driven by top down over those responsible.
Hierarchies retain decision making continues at the top, so in theory that should be where the buck stops. However, the nature of the power relationship internally creates weak accountability for higher level decisions. Traditionally the only accountability for these decisions is through signals from shareholders or some times customers.
The signals from the stock market and shareholders on management decisions are often weak. We accept high turnover in shareholders, customers and employees and explain away discontent. Dealing with exit of frustrated shareholders, employees and customers is often as easy as adopting a growth orientation. Management need not consider the voices of those leaving as a source of accountability or a source of performance improvement.
In an increasingly complex network world, this approach to accountability is no longer sustainable. While you retain a hierarchy for the allocation of responsibility, internally and externally your organisation needs to leverage networks to manage the complex relationships and challenges it faces. Suddenly we need to consider the shifting flow of authority and power in a wirearchy.
Traditional decision making (& the associated accountability) is also backward looking. We examine history to determine what to do and what should have been done. As Harold Jarche points out we can’t look back to the past to predict the next decision or even who to hold responsible for action. Increasingly the question around accountability is ‘how will this decision be viewed at some point in the future by our stakeholders?’
New Network Accountability
With the increasingly networked world comes new sources of accountability. Employees, customers, shareholders and the community now have voice and the ability to organise. They can leverage their relationships with the organisation and others to express their concerns. Organisations must increasingly enable all their employees to respond to these situations when and where they arise. That demands a more responsive organisation.
These new internal and external accountabilities can’t be ignored or managed away without jeopardising business relationships. A decision not to participate in social interactions or the network won’t stop the conversation. It simply means your voice goes unheard In the conversation and might harm your business. Those who better respond to the needs and concerns of your employees, customers and community in the network will see their influence grow as those who ignore the accountability to the network will see influence fade.
The opportunity for responsive organisations is to embrace the new accountabilities in the pursuit of more effective performance. With these accountabilities comes:
- new information on the performance of your products, services, opportunities with your customers and your impact in the community
- new relationships with influencers in the networks within and around your organisation
- opportunities to leverage the talent and potential of people internally and externally who may not be within the consideration of the current hierarchy.
You may not change your strategy, your products and services or your organisation as a result of this additional network insight. However, if you will have done much to better understand the true performance opportunities in your business and to remove risks that the weak accountability and weak information flows of a hierarchical approach may miss.
We encourage accountability in business as a driver of performance and an opportunity to improve. Shift your accountability from the hierarchy to the network. You will discover new opportunities for your organisation.
This post is the first in a five part series on managing accountability in the network era. The posts deal with: