By Kevin Herring
ORO VALLEY, Ariz. (April 16, 2013) — Remember when your parents said you couldn't do something and you responded with something like, "But Suzie does it."
Then your parents set you straight by responding, "But you're not Suzie!"
Your parents had good reason to shoot down your argument, besides making the point that you weren't going to get away with whatever Suzie did. They wanted you to know that comparing yourself to Suzie, or anyone else for that matter, wasn't a useful exercise.
Time hasn't changed that. Arguing that because you and Suzie have similarities you should be like Suzie in other respects didn't hold water then, and it doesn't hold water now. And it doesn't make sense when it comes to comparing company organization charts and headcount, either.
Every business is different. Even those in the same industry and product or service line are different. They all have their own internal strengths and weaknesses. If they didn't, what would be the point of a SWOT— Strengths, Weaknesses, Opportunities, and Threats—business analysis? The fact that they're different causes companies to create unique goals and strategies to help them compete.
So naturally, when a good friend mentioned that his department was going to be compared to similar departments in other businesses according to function, budget and headcount, I immediately thought of Suzie. I wondered why he is being compared to somebody our parents said isn't relevant when deciding what's best for him and his group. Not only did Suzie get away with everything, to add insult to injury, she's now the standard we are assessed against.
Sixteen years ago, I went through a similar exercise when the company I worked for was acquired. The parent company, looking to cut costs, rounded up every job title that connected in some way to our people strategy and crammed them all into a function labeled Human Resources. They then looked at a study of businesses in the same industry and revenue range—just like Suzie—and announced that our department was way too big. In fact, it was so bloated with staff that over half were unnecessary.
On the face of it, it seemed we were paying for a lot of unnecessary people to do a few basic administrative functions, and our competitors were eating our proverbial lunch. But what the study couldn't explain was that more than half of those in our department who were being compared to benefits and workers compensation administrators in other companies, were actually dedicated to a business transformation that was making our company the best performer in our industry. These "extra" staff played a key role in executing our strategy for being the best.
Nevertheless, managing to keep the facts from clouding the conversation, the number crunchers won the day, as did the headcount executioner. Within a matter of months, the strategy that led to one of the most remarkable business turnaround stories in history was decimated. After that, it only took a few years to literally wipe out every vestige of what was once a thriving Fortune 500 company.
Now, Suzie has reappeared, and my friend is wondering how his group will stack up against her. He's afraid decision makers won't consider how his department helped product groups become some of the highest performing in the company and instead will decide to cut his staff based on a simple numbers comparison. That wouldn't be bad for just his department; more importantly, it would hurt the entire division.
My friend's best hope is making a strong business case that shows the value he brings to product groups. If he can demonstrate how the business will be hurt without his group's help, he may be able to keep his department intact. But if leaders fail to see beyond the number crunching…well, I won't be the only person hating Suzie.
Trying it on for fit
Comparisons can be useful when looking for new ideas or ways of thinking by learning how others operate and understanding why they do so.
They can help counter the not-invented-here syndrome by encouraging employees to open their minds to learning from others. Comparisons are not useful when making decisions without a qualitative and quantitative understanding of what the data mean. And contrary to what some authors claim, comparisons don't create strategic advantage when the end goal is to learn how to become like a competitor.
When making comparisons, to get the most from the exercise, consider the data with the following in mind:
• Why does this attribute exist in this company or department?
• What advantages does it provide?
• What challenges does it create?
• In what ways could it be applied to our circumstances?
• How and why are we different? In what ways are we the same or similar?
• What can we learn from a comparison to help us improve our results?
Send me an email to let me know what you learn from your experiences. I would love to hear from you.
Kevin Herring is president of Ascent Management Consulting Ltd. in Oro Valley, Ariz., and co-author of "Practical Guide for Internal Consultants." He can be reached via email at [email protected] or by calling 520-742-7300. Ascent Management, at www.ascentmgt.com, specializes in performance turnarounds, leadership coaching and appraisal-less performance management.