Thoughts on the 98/2 Rule

Article: http://www.businessweek.com/managing/content/nov2010/ca2010118_633713.htm

This article talks about the 98/2 principle; essentially 98% of people are ethical and the other 2% are not. You can explain this even better than by saying most disciplinary principles are focused toward the 2% of your workers who cause problems.

Personally, this number seems low but it is not saying this is the amount of people who are unproductive, or bad workers. The article is strictly saying, 2% of the people in a given company are troublemakers and it’s sad to see companies be so proactive about preventing bad habits that are hurting the other 98%. In today’s society, this is becoming more and more evident. The behaviors of one person affect everyone!

Harold Sirkin proposes a new idea: instead of punishing the 98%, reward them. Focus policies on the 98% that are doing their job and staying ethical. By doing so, morale will increase and it will eventually weed out the 2% that aren’t pulling their weight.  "The 2 percent find themselves and the 98 percent help us find them."

This is true for so many different aspects of business, but I don’t know how it would actually work. You can take a look at other places where the 98/2 rule applies. Law enforcement is a great example; 98% of the population is being protecting from 2% of the criminals. Without police, the world would be a crazy place. Look at the housing crisis. The economy fell apart because 2% of homeowners started defaulting on loans!

What’s the alternative to stop regulating 2% of the troublemakers? More freedom and more empowerment, but the risks are also much greater. 

Less is More

Meaning: The notion that simplicity and clarity lead to good design.

Origin: Andrea del Sarto, 1855, a poem by Robert Browning

http://www.phrases.org.uk/meanings/226400.html

Who strive - you don't know how the others strive
To paint a little thing like that you smeared
Carelessly passing with your robes afloat,-
Yet do much less, so much less, Someone says,
(I know his name, no matter) - so much less!
Well, less is more, Lucrezia. 

My fiancé and I are buying a house in the Lehigh valley area, and we have been spending so much time on the mortgage application. Granted, we’re trying to rush the process, but it still seems that there is so much needed when we are perfectly qualified for the mortgage. For example, I graduated May 2009 and I have been working since July of 2009. The bank would like the copy of my diploma and residency for the past two years. Personally, it’s a good thing that the bank requires this much information after the housing crisis, but it is stressful to get everything in line in such a short amount of time. 

How does this relate to OB? My whole point is that we’ve entered a new age. My professor in undergrad said a handshake is worth much more than a signed document. When he was younger, business relationships were made by talking on the phone and through consistent business with each other. Now this has changed. Every agreement made is signed and initialed many times over, so much to the point that you don’t even understand what you’re signing without a lawyer!

Here’s a great example. I’ve been living in the same apartment for over a year, and the lease was about 15 pages. I just looked it over because I needed the information for the mortgage. My current landlords are not so great. When I had an apartment in West Reading, the lease was two pages. That’s it! The landlord lived downstairs and he was great. In some situations, I think less is more.

In fact, when you think about it, when you are a manager, you can empower your employees with this type of thinking. By managing less (aka avoiding micromanagement), there is a good chance that you’re employees will appreciate the added responsibility and do more!

Hiring a Missing Position

I’m sure you have all been in this position before. Someone on your team quits and moves on only to leave you with more work to do. Better yet, you are still getting paid the same amount of money and now you’re manager is watching you closer because it is crucial that all the work gets done.

After a while, you get used to the extra work. You learn to manage because you’ve come to the conclusion that no one else is going to be hired; however, your manager finally decides that it is time to fill the position. Next thing you know, you have a new coworker and you were never in the loop! This makes me ask the question:

From a management position, is it better to hire a new hire with your team knowing, or is it better to fill the spot and never let the team know until day one? If you work on a small team, should they be involved in the interview process? After all, in a small team you have to work very closely in order to get all the work done.

I’ve never been in a management position when this situation arose but it would be interesting to hear from someone who has been. It seems more often than not, decisions are made behind the scenes in order to keep the employee’s mind focused on the matter at hand. I do not think this is the best way to communicate with your employee’s, but it’s an understandable approach. I just want to know if anyone has taken the other path and what impact has it made?

This article talks about how to prevent hiring disasters. One of the recommendations is to identify the ideal candidate and competencies needed. Maybe this is where you can use your coworkers to help identify these needs.

http://www.businessweek.com/managing/content/may2010/ca20100528_317741.htm 

Abstract

The purpose of this paper is to explain Frederick Herzberg’s two-factor theory and apply it to today’s working society. First, Herzberg’s two-factor theory is explained in detail, and then each generation is briefly analyzed. Suggestions are then made as to how to retain employees in today’s free market society. By looking at Herzberg’s two-factor theory, one can determine how motivated an employee is at the workplace.  Also discussed are motivators and hygiene factors and how these are applied in the workplace. The paper then gives a brief summary of each working generation; Silent Generation, Baby Boomers, Generation X, and Generation Y. Although there is no clear cut answer on how to retain employees in today’s society, this paper can help better understand why employees from different generations stay or leave.

Credibility

Head Coach Mike Shanahan is causing quite a stir in the world of football. In Sunday’s game against the Detroit Lions, Shanahan benched Donavon McNabb in the last two minutes of the game. As you can imagine the press hounded him for the decision and asked him as to why he made the move. Shanahan stated that Rex Grossman the second-string quarterback was better at running a two-minute offense than Donavan McNabb. Despite the reasoning, he still received a lot of criticism for taking out a veteran quarterback and replacing him with a second-string. Not many people were thrilled with his decision.

Today, Shanahan comes out and also says that McNabb’s physical fitness played a major factor as to why he was benched. Now, people want to know which the real reason for the last minute move is. If you didn’t already know, Shanahan was fired from Denver after 14 years before he moved to Washington. During his time as head coach in Denver, they won two back to back super bowls in 1997 and 1998. The records show that he is a good coach.

Handling the public is an important part of organizational behavior. The CEO of a company has to work with the public on a daily basis. On the same token, the manager has to work with his employees on decisions made. A bad decision can quickly change the credibility that a manager once had. It’s interesting to see what happens with the debacle in Washington because it is a great lesson in OB. Will he be able to recover from the onslaught of media attacks regarding his decision to bench McNabb? Will he still be the head coach for Washington after this season?

Warren Buffet often said “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently.”

Check out the story here:

http://www.redskins.com/gen/articles/Shanahan_Says_Injuries_Contributed_to_McNabb_s_Benching_168554.jsp