The Parable of Corporate Change

By Dr. Larry Pfaff

Once upon a time, a large Established Company and a small Startup Company decided to have a competitive boat race. Both teams practiced long and hard to reach their peak performance. On the big day, they were as ready as they could be.

The Startup Company won by a mile.

Afterward, the Established Company became discouraged by the loss, and their morale lagged. Corporate Management decided that the reason for the crushing defeat had to be found. A Continuous Measurement Improvement Team was set up to investigate the problem and to recommend appropriate corrective action.

Their conclusion: The problem was that the Startup Company had eight people rowing and one person steering, while the Established Company had eight people steering and one person rowing. The Established Company immediately hired a Consulting Firm to do a study on the Management Structure.

After some time and millions of dollars, the Consulting Firm concluded that "too many people were steering, and not enough were rowing." To prevent losing to the Startup Company again, the Management Structure was changed to "four Steering Managers, three Area Steering Managers, and one Staff Steering Manager" and a new performance system was implemented for the person rowing the boat to give more incentive and to work harder, and to become a six sigma performer. The Management concluded "we must have more empowerment and enrichment."

The second year the Startup Company won by two miles.

As a result, the Established Company laid off the rower for poor performance, reduced the paddle inventory, canceled all capital investments for new equipment, canceled the product development program for the new boat, awarded high performance awards to the consulting company, and distributed the money saved to the Senior Executives.

With the aid of Federal Legislation requiring any Startup Company to drill holes in their boats, the Established Company is now very optimistic about its new team. It is comprised of eight lawyers in a four person canoe sharing two paddles.

Please send any comments, questions or suggestions to Dr. Pfaff at [email protected].

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