Any exceptional enterprise depends first and foremost upon having self-managed and self-motivated people – the #1 ingredient for a culture of discipline. The word ‘discipline’ for most, resonates with having rules, rigidity and bureaucracy. I am however suggesting quite the opposite here. If you have the right people, who accept responsibility, you do not need to have a lot of senseless rules and mindless bureaucracy in the first place.

So who are the ‘right’ people.. there is a fairly easy distinction between the wrong people and right people and it does not take a genius to figure this out, the former see themselves as having a ‘job’ while the latter see themselves as having responsibilities. When I visit organisations and ask someone ‘What do you do?’, the most common response I receive is laced with the person’s designation, I am head of marketing or I am Manager Accounts. It is a rare occasion when someone starts with ‘I am responsible for…..’.

Another fairly easy assessment you can make as a CEO is by carefully examining where you spend most of your time. Is it in managing people and resources or is it in planning, developing and strategising future growth? If, as the CEO, you are spending any more than 20%-30% of your time in managing, it is a clear indication that you do not have the right people in key positions.

There is no necessity of complex psychometric assessments or elaborate performance management evaluation to understand if you have the right people in key positions or not. Empirical evidence about each person in key position on the following characteristics of right people, would be enough for you to make an assessment:

The Right People…

  1. Fit with company’s core values
  2. Don’t need to be tightly managed
  3. Understand they do not have a job, they have responsibilities
  4. Fulfil their commitments
  5. Are passionate about the enterprise and it’s work
  6. Display window and mirror maturity

Growth and sustainability although pursued relentlessly, remains elusive for most enterprises. All the hard work does produce some spurts in revenue but it is either a camel back ride or flat out unsustained.

“No company can consistently grow revenues faster than it’s ability to get enough of the right people to implement that growth and still become a great company”… David Packard; HP Cofounder.

Jim Collins has coined this as ‘Packard’s Law’.

This is how Packard’s Law operates. When companies fill key seats with the wrong people, to compensate for their inadequacies they institute bureaucratic procedures which in turn drives away the right people because they either choke under the bureaucracy or cannot tolerate working with less competent people or both. This invites more bureaucracy by having more of the wrong people which then drives away more of the right people and a culture of bureaucratic mediocracy gradually replaces a culture of disciplined excellence.

Mediocrity kills disciplined excellence. Mediocrity originates when bureaucratic rules erode the ethos of freedom and responsibility and bureaucratic rules stem from having the wrong people in key positions.

For sustained growth and excellence, put your organisation under the lens by answering the questions below and take decisive actions.

  • What are the key seats in your organisation?
  • What percentage of these seats are filled with the right people?
  • What are the plans to increase this percentage?
  • What are the backup plans in the event of a right person leaving the key seat?
Acknowledgement: How The Mighty Fall,  Jim Collins -2009
Packard’ Law for Sustained Growth