Strategic tolerance: Cultivate it to survive and grow

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The executive at General Motors who, with the authority of GM’s top management behind her, brought Cadillac back to top-ranked quality ratings for luxury cars after they had dropped to 14th world wide taught two principals to senior management alike: (1) Suspend blame and (2) Take responsibility. For example, the engineers who were working to improve Cadillac’s trunk space came to management and said: “we designed this wrong five years ago and it’s costing the company $2 million a year and we want $1 million to fix it”. To counteract the executive’s natural instinct to leap over the desk and rip out the throat of the offending engineers, she taught management to respond: “We appreciate your honesty and analysis, and management will assess this opportunity for improvement very seriously”.
Understandably, mistakes are part of jobs and the way they are treated reflects organisational behavior, indeed culture. Let’s first understand organisational culture in words of Edger Schein (world-renowned psychologist) “culture is a pattern of shared basic assumptions that was learned by a group as it solved its problems of external adaptation and internal integration that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems”.
Generally, problems either results from mistakes or pose challenges to organisations in term of innovation to grow and live up to market needs. Competitive cracking of problems and winning innovation demands quality ideas. If the game is all about ideas then what part of human body must be the center of discussion? Yes, it is brain. Research in neurosciences shows that the brain’s limbic system, which governs our feelings, is way more powerful than the neocortex that controls intellect. Keeping this revealing fact in view two approaches are worth discussing: (1) human capital and (2) emotional capital. Human capital approach means putting people in the game with right education, skills and attitude whereas emotional capital approach aims to ignite human willingness at required level. For human brain to produce quality ideas, such an environment is required which may spark ‘creative tension’. Making people feel free and giving ‘emotional challenge’ will help to create an environment of creative tension, indeed a new smell as Sumantra Ghoshal (Founding Dean of new Indian School of Business in Hyderabad) says. “The essential problem is not to change people, the real problem is to create new atmosphere, what we call the smell of place”. Daniel Goleman (Author of Emotional Intelligence 1997) states that “we can be effective only when the two systems, our emotional brain and our thinking brain work together”. In simple words an atmosphere of creative tension bridges skill (human capital) and will (emotional capital).
Aren’t we missing something about ideas? Of course yes, something which is hard to digest; it is failure. Mistakes and experiments are not exempted from failures. As Twyla Tharp says that “sooner or later, all real change involves failure”. Ideas might be flawed to bring winning innovation and mistakes sometimes may result into big loss. How to deal with it? Two facts about business must be taken into account before developing an approach to deal with failures. First, mistakes are unavoidable. Second, experiments are the heart of business to grow. The only behavioral input left to deal with either failures or mistake is ‘strategic tolerance’. Strategic tolerance means a consistent sound behavior required to achieve strategic goals of organisation. Certainly, tolerance doesn’t mean demonstration of tight lips and clinch fists rather it essentially mean such an encouraging feedback which may spark creative tension. In Edmondson’s words “management must create an environment of psychological safety, convincing people that they will not be humiliated, much less punished, if they speak up with ideas, questions, or concerns, or make mistakes”.
Is strategic tolerance a panacea? Sadly, it is not because the desired upshot of such culture is subject to the caliber of human resources and other organisational policies. For instance, if there is something seriously wrong with compensation policy then no matter how long you tolerate, give motional challenges and make people feel free, expecting quality ideas will be just day-dreaming.

The writer works in the financial sector

1 COMMENT

  1. Dear writer, you did a good effort but there are some irrelevant and conflicting statements in your article…. e.g
    “culture is a pattern of shared basic assumptions that was learned by a group as it solved its problems of external adaptation and internal integration that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems”.
    how this broder definition of culture is linked with business envornment and culture: where things change day by day and to be remain in competition one cannot rely on the assumptions and pattern of 1980s for competing in 2011.
    second contrdiction is your explanation of "brain’s limbic system" which is more powerfull than human intellect. considering this fact, how a manager can control its powerful brains limbic system and react Tolerantly (feeling not intellect) in the scenario of great loss or mistake.

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