EARLY WARNING SIGNS

Jayashantha Jayawardhana spells out the whole truth

There are always warning signs that a marriage, team, company or country is beginning to go downhill – even if it’s at an imperceptibly slow pace. Rosabeth Moss Kanter is the Ernest L. Arbuckle Professor of Business at Harvard Business School. Kanter identified nine universal warning signs of corporate decline while researching for her book titled Confidence. Here they are…

COMMUNICATION GAP The flow of information is reduced to a trickle and disappears entirely eventually. People are silent and retreat deep into themselves. Transparency and openness are dismissed, and decisions are made in secret – much like in the Pentagon.


And the line between fact and fiction becomes so blurred that no one feels safe to speak. Official statements are looked upon with suspicion and eventually rejected on the basis that they’re unreliable. And to make matters worse, gossip substitutes for the truth. The longer this continues, the quicker the decline.

THE BLAME GAME Criticism and blame increase in frequency and intensity, and a culture of accusation sets in. Things start sliding rapidly but people deny any fault on their part and point fingers at others instead. The management argues that it’s the staff who is to blame and vice versa.

Hostilities flare up and people’s intuitive judgement is clouded by the primitive impulse of fight or flight. External forces and factors are blamed for the downfall, and personal responsibility becomes virtually nonexistent.

LOSS OF RESPECT As the urge for self-preservation kicks in, people start to cultivate a mindset known as ‘defensive pessimism’ where they lower their expectations and prepare for the worst. Respect, diplomacy, professionalism and even common decency peter out. People start acting as if doing the bare minimum is enough and reinforce the vicious cycle of destruction unbeknownst to them.

ONSET OF ISOLATION As solidarity diminishes, fear and distrust snowball. People retreat into their own like-minded cliques, are suspicious of others, and reluctant to engage and collaborate to explore the possibility of viable solutions to the ongoing organisational crises. Withdrawing from  contact isolates them further and encourages others to back away too. And therefore, the isolation becomes even harder to break.

INWARD FOCUS As the organisation continues to slide, people become more and more self-absorbed at the expense of customers, constituencies, markets etc. They become more interested in the collective impact of what’s happening to them rather than trying to discover how it affects their organisation. Finally, self becomes the overriding concern.

NEW TURF WARS Rifts widen and inequities grow as turf wars escalate to epic proportions. A few become the privileged elite, claiming inordinate attention, resources and opportunities. Increasing power differentials and social distance – between groups and levels – make it exceedingly hard to evoke collaboration. With the growing sense of insecurity, people start hoarding resources for their own use.

NO ASPIRATIONS As the toxic and corrosive effects of organisational decline become pervasive, people start to convince themselves that it’s impossible to forge ahead. They lower their expectations and settle for average – because they’re obsessed with minimising the damage that they fear will result from the inevitable fall.

ZERO INITIATIVE When people become paralysed with anxiety and worry, and expect the worst for themselves – like dismissal without even the semblance of a severance package – they even stop thinking about taking the initiative, making a change or innovating and passively following the routine.

EXTREME NEGATIVITY In an emotional chain reaction, pervasive negativity accelerates the decline. This culture permits and even promotes mean behaviour (selfishness, greed, mistrust, disrespect, petty turf battles and an alarming increase in excuses) as it replaces positive, thoughtful and constructive action. Intractable negativity kills all goodness and the sense of humanity that’s inherent in most people.

As Kanter points out, it’s quite easy to get caught up in the doom and gloom of downward spirals. After all, we’re human and the instincts of self-preservation are hardwired into our brains through millions of years of evolution.

On the bright side however, there are organisations and countries that have transformed themselves after being on the brink of bankruptcy. And there are couples who’ve resolved to stick together despite their problems so they can keep their families from splitting up.

So if leaders are vigilant and sensitive enough to be able to read the early warning signs correctly, and positively resolve to rally the troops and fight back, an extraordinary turnaround is always a possibility.