More than two-thirds of Fortune 500 companies flocked to use a consulting company he had founded. But he also often became a target of ridicule as a leading light of “pop” management.
Whatever the truth may be, the fact is it’s quite difficult to ignore Stephen Richards Covey, who died on Monday. The man who Time magazine called a “human potential guru” is mostly known for his wildly popular The 7 Habits of Highly Effective People, which was published in 1989 and has sold more than 25 million copies in 38 languages. He added one more “habit” later in life.
The 8th Habit was path-breaking at a time when the world was waking up to a new idiom: the knowledge worker. Calling for a new model for change in the unspoken, unwritten contract between employer and worker, Covey said most employees experience considerable emotional pain while working in their organisations because they are treated as objects, not full human beings. He based this fresh paradigm on respect for the complete person – mind, body, heart and soul – not just the part that works from nine to five.
This is important since too many companies still put people on the P&L statement as an expense; equipment is put on the balance sheet as an investment. That is a legacy of the Industrial Age — the great technique that motivates with a carrot in front (reward) and drives with a stick from behind (fear and punishment). The problem, Covey said, is managers today are still applying the Industrial Age control model to knowledge workers.
As any credible research will tell you, leaders’ inability to realise this change has led to a decline of trust in the workplace. Research shows that fewer than half the employees trust senior management, and only a third believe CEOs are a credible source of information. According to Covey, “most people don’t know how to think about the organisational and societal consequences of low trust because they don’t know how to quantify or measure the costs of such a so-called ‘soft’ factor as trust.” For many, he said, trust is intangible and, thus, unquantifiable. And he added: “if it remains that way, then people don’t know how to get their arms around it or how to improve it.”
But the fact is, as Covey has shown, the costs of low trust in an organisation are very real, they are quantifiable, and they are staggering. For example, significant distrust doubles the cost of doing business and triples the time it takes to get things done. A Watson Wyatt study showed that high-trust companies outperform low-trust companies by nearly 300 per cent. For, Covey said, “when trust is low, in a company or in a relationship, it places a hidden ‘tax’ on everything: every communication, every interaction, every strategy is taxed, bringing speed down and sending costs up”.
This happens because most organisations are over-managed and under-led. Covey’s prescription was simple, though managers found it very difficult to practise it: leaders must overcome their inability to give up control and empower people. Since only a third of your product cost today is materials – the rest is knowledge – companies have no option but to empower their knowledge workers as never before.
It’s essential, Covey said, that leaders build a culture in which people are allowed – even expected – to push back against a decision they have taken. Empowerment implies a different kind of performance appraisal. He said: “Instead of a lecture by the boss, your progress should be evaluated by the best qualified person: you. Self-evaluation is tougher than anyone else’s evaluation, but with a high-trust culture, helpful systems, as well as 360-degree feedback data, self-evaluation becomes not only possible but easy. The performance evaluation can then revolve around managerial questions such as: How is it going?” What are you learning? What are your goals? How can I help you?
This is necessary, Covey said, as communicating in an environment of no trust is impossible. “Even if communication is clear and precise, people will always look for hidden meanings and agendas. But when there’s high trust, communication is easy and instantaneous,” he added.
But trust is possible only when there is two-way communication. “If you’re like most people, you probably seek first to be understood; you want to get your point across. And in doing so, you may ignore the other person completely, pretend that you’re listening, selectively hear only certain parts of the conversation or attentively focus on only the words being said, but miss the meaning entirely.” This happens because “most people listen with the intent to reply, not to understand,” Covey said.
In his Habit No 2, Covey had asked readers to imagine their funeral before composing a personal mission statement based on what they would like family, friends and business associates to remember in a eulogy. But what he didn’t ever write was mentioned in his private diary: “My goal in life is to be the kind of person my dog thinks I am.”
Peter Drucker once wrote, “So much of what we call management consists of making it difficult for people to work.” That can be avoided to some extent if leaders try and absorb The 8th Habit. That will perhaps be the best tribute to an extraordinary man.
