In a recent conversation, a troubled former colleague described a situation where their manager made a risky decision to invest budget dollars in an outsourced project that went very poorly. The result was a fiscal crisis, and the manager told my friend he had to fire several members of his team to make up the shortfall. The company had undergone a recent reduction in force, and had pledged to the remaining employees that they were all on safe ground, so another reduction would not be well received. When presented with this sentiment, the manager instructed my friend to “just put them on performance improvement plans that they will be unable to achieve,” as a way to avoid acknowledging that the reduction in force was a fiscal issue. My friend refused to participate, and in the end lost his job in a somewhat murky quit-but-was-really-fired sort of manner, and the members of his team were still terminated.
This saga was wrong on so many levels. The manager was the one that took the unplanned risk, spent the money, and failed. Rather than take responsibility directly, this manager attempted to cover up the budget problem by forcing a subordinate to cut staff with a blatantly false approach to set people up to fail, rather than honestly dealing with the budget issue.
My colleague was questioning his own judgement. He attempted to save the members of his team, and instead they still lost their jobs and so did he. It was so distasteful that he considered whether he wanted to stay in middle-management, or go back to being an individual contributor.
Talking about the incident, we agreed that there were several different issues at play. The manager probably did something wrong when he decided to spend limited budget money in a manner that was risky and unplanned. It resulted in a budget shortfall. We can fault the original decision, but the budget shortfall is a fact, and at that point, the ‘should’ve’, ‘could’ve’, ‘would’ve’ discussions are moot because the money is gone. For my friend, this was a lesson in black and white versus gray.
Front line employees can operate in a black and white world. Decisions are right or wrong, choices are clear. As you move up the management and leadership ranks, the world becomes more gray. Circumstances are more nuanced, choices all have tradeoffs and consequences. I often say that CEOs live in a gray space because all of the black and white decisions have already been made before problems get to the CEO. In my friend’s situation, the company had promised employees stability, so he viewed it as black and white that they would not eliminate more people. The problem, unfortunately was more gray. The money was gone and the choices all had to revolve around the fact that they could not afford to maintain current spending levels. That translated into a need to eliminate staff. Standing on the B&W principle of the promise of stability was not a realistic choice.
However, the real problem is how the manager dealt with the situation. Instead of being transparent and honest about why the money was gone, and accepting accountability and responsibility for the situation, this manager attempted to push the problem onto his subordinates and make them the “bad guys.” Most egregiously, he guided them to create disingenuous performance plans (PIP) as a covert way to eliminate staff without acknowledging the real issue. Bad, Bad, Bad!
I applaud my friend for refusing to follow the PIP route, and I recognize the career jeopardy this created. However, acknowledging the B&W situation of the budget problem also required him to live in the gray world of management and deal with the problem that the company could not fulfill its promise of employment stability once the cash was gone. To paraphrase a Star Trek line, “the needs of the many outweigh the needs of the few.” If the cash is gone, preserving the company and many jobs outweighs the pain of eliminating a few jobs. It should have been handled in a more professional manner, and if anyone should have lost their job, the most obvious actor is the manager who created the problem and behaved inappropriately to avoid accountability and acknowledge responsibility.
When bad things happen, and leaders are forced to live in the gray zone, character matters. If there is no black or white choice, decisions are guided by the leader’s character and values. A phrase I have always liked is that a leader’s role is to ensure that the organization is “doing things right, and doing the right things.” This is typically in reference to operational goals and skills, but for a leader, doing things right also relates to making the right values-based decisions. In the example of the manager’s behavior, he neither did the right thing nor did he do things right. The right thing would have been to acknowledge the cash problem and take responsibility. Doing things right, would have been to manage an honest reduction in force, and not a covert RIF via disingenuous performance plans.