December 4, 2013
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Giorgio Maschietto, managing director of Level Chile S.A., a packaged-goods company, was in charge of many factories in South America, including a huge Pepsodent toothpaste plant.  This plant had a problem: a malfunction in the production line lead to empty cartons being often sealed up and sent to stores.  A highly delicate and expensive weighing machine beneath the conveyer belt was supposed to ensure that each carton actually contained a tube.  Trouble was this high-tech scales never quite worked and many empty cartons hit the shelves.

To the surprise of puzzled engineers and concerned managers, the solution came from one of the line operators.  This employee had the brilliant idea to replace the expensive weighing machinery with a small jet of air across the conveyer belt.  The regulated compressed air created just enough pressure to throw the empty cartons off the belt.  A simple idea from the factory floor solved a huge problem that proved to be too difficult for the highly-educated staff.

Maschietto was the kind of manager that knew how to listen to his employees and how to encourage his line managers to do the same.  The empty carton challenge was not the only problem that was solved by a line operator at Pepsodent.  Another idea from the factory floor solved an even more painful setback.  The factory’s production schedule was constantly being interrupted by the need to wash out the steel toothpaste tanks.  An ingenious solution proposed by an operator reduced changeover time by 70% and significantly increased productivity.

The wisdom behind the empty toothpaste carton case is as relevant today as it was in 1936 when Dale Carnegie first published his bestseller “How to Win Friends and Influence People”.  Carnegie was one of the first to show the importance of active listening and open communication to sound management.

An open organizational culture keeps everybody in a creative mind-set and gives employees the courage to speak up their ideas.  Managers, following the personal example of a truly open leader, listen actively to these ideas and maintain the common sense to follow through when the case.

You can review ideas in your company using simple or more complex approaches: the good old suggestion box, innovation challenges and other contests, specialized software for collecting, ranking and tracking the implementation of ideas about improving the business.  These tools work only if people are constantly encouraged to participate by the talk and walk of their leaders.  They also have to see that the company turns the best ideas into action.  People are looking for facts in order to understand if they are truly welcomed to speak up.

Consulted employees get a sense of recognition and self-value when they are taken into account and involved in the decision making.  This builds engagement and facilitates properly-informed decisions in your company.

Making informed decisions is not such an easy task as some might reckon.  This difficulty has a special name, in fact: the CEO disease.  Top executives are given only the good news and end up living in a protective cocoon.  Some are too scared to break the bad news; some think it’s not in their best interest to do it.  Don’t let yourself mislead by the name though.  The CEO disease can outbreak at all levels of management.  It’s just that the higher you are in the organization, the greater your people’s tendency to hide the bad news from you.

Giorgio Maschietto knew that the best inoculation against the CEO disease was to be as open to his people as he expected them to be with him.  It really paid off. Literally.  Other managers choose to enjoy the comfort of their shielding cocoons, from which it is hard to understand why people never speak out, step up or even care about the company’s problems.

7 Tell-tale signs of miscommunication and poor leadership in your company:

  1. Executives want to make every decision but don’t bother finding out all the relevant details
  2. Managers think they can do no wrong and refuse to concede any mistake.  They choose to be surrounded only by flatterers who say yes to every move they make and every idea they suggest
  3. Managers seek personal recognition instead of recognition for their teams
  4. Direct reports don’t have the courage to step up and speak up
  5. Employees constantly sweep the bad news under the carpet
  6. The rank and file lose faith in top management
  7. Executives expect the royal treatment and are constantly condescending and contemptuous to people who serve them.  A “we versus them” attitude prevails among executives

5 Benefits of open communication and transparent organisational culture:

  1. Informed decisions  = better decisions
  2. Your own employees are a rich resource of good business and technical ideas that are almost free!
  3. Employees are highly motivated to implement actions and undertake tasks when they are involved in planning and decision making
  4. Transparency is the best prophylaxis and a strong antidote against the CEO disease
  5. Managers that know how to actively listen to their direct reports build stronger engagement and high performance teams.