By James Bowen and Brian MacNeice, co-Managing Directors of Kotinos Partners and authors of Powerhouse – Insider accounts into the world’s greatest high performance organizations.

Finland breaks many of the rules of conventional wisdom in school systems, especially those of developed countries. Finnish children start formal education later than most of the rest of the world, entering school at the age of seven. These children have shorter school days than the norm and receive less homework than their counterparts internationally. They sit no standardised exams until the very end of their time in the school system. Moreover, the state has long abandoned the school inspections beloved of other nations. Teaching professionals are afforded autonomy to determine how to deliver the national curriculum guidelines. There are no published league tables indicating the best and worst schools in the system and virtually no private tuition or private schools in the country. In spite of all of this they are consistently topping the charts of international education metrics. More impressively, they have the smallest performance gap across their student base – in other words the gap between the best and worst performers in Finnish schools is smaller than anywhere else in the world.

A key theme of the high performance model of Finnish Education is the importance of giving good people autonomy for decision making. Highly qualified people – equipped, enabled and trusted to make smart decisions. There are a lot of smart people working in organizations that do not enjoy the same level of autonomy for decision making. Our belief is that this is an important principle for high performance. So how do you ensure your organization is set up to leverage high calibre people and empower them with responsibility to do their job well in the same way Finnish school teachers are?

Business organizations are becoming increasingly complex. As a result, the way that businesses are managed is becoming more complex. In particular, it is no longer always obvious – even from inside the organization – where control lies for matters of either strategy development or execution. We subscribe to the view that ‘strategy happens’ – that strategy is what businesses do, rather than what they say they do. Strategy (and therefore performance) is the amalgam of very many individual insights, decisions and events occurring throughout a business over long periods of time.

Control confusion: Who’s in charge?

In a world where fresh insights emerge every day and decisions are constantly there to be taken, confusion around control – coupled with confusion around how to deal with this confusion – creates real challenges when it comes to delivering sustained high performance.

Unless managers are certain that they have control over a particular strategy or decision, typically they default to perceiving that they have no control, and effectively look to refer or delegate particular decisions elsewhere. Sometimes this approach is entirely appropriate, particularly if the decision-making ‘receiver’ is geared up and ready to step into the breach. More often, however, our experience is that decisions referred become decisions untaken. As a result, unnecessary issues crop up, performance-enhancing ideas remain untapped, performance ‘stalemate’ ensues and managers become increasingly frustrated and disengaged.

Day-to-day remedy: Change the default

This can be addressed by pushing teams to switch their default to the opposite setting – assuming that they have control unless it’s completely obvious that they don’t, and to being proactive in filling any strategic or decision-making vacuums they observe. The focus then shifts to making sure that environments and working models within their teams maximize the performance outcomes they deliver. This, in effect, is what the Finnish Education Model has achieved. Local administrators, school principals and teachers are allowed to assume control for key decisions in how they will implement the National Curriculum. It unlocks the creativity of the workforce and the level of responsibility they take for the outcomes they are trying to achieve.

A Key to High Performance: Control by (Organizational) Design

While this approach occasionally leads to conflict in large organizations between middle and senior management or in a multi-national corporation between local and central management teams, in practice such conflict is rare. Moreover, if managed professionally and collaboratively, such conflict often gives rise to even better decisions and outcomes for the business. We believe that biasing towards too much ownership for performance, and therefore looking to err on the side of commission (doing too much) rather than omission (doing too little), leads to better and more sustained business and organisational outcomes.

This principle is maintained more structurally through effective organizational design. Leaders should look to design ownership for strategy and performance as far down into their organizations as they can get, and to the maximum extent that they can achieve – albeit within an overarching business or corporate framework. Rather than strategy and decision-making control having to be assumed, high performing businesses design organizations based on capability, empowerment and trust where these are routinely given. The advantages of pace, engagement and leverage delivered by this approach convert seamlessly into sustained outperformance of these businesses over time.

The Finnish education model has this dynamic right. The strategy has been set at a National level and aims to ensure an equal education opportunity for all based. Local educators are then equipped, empowered and expected to determine how best to deliver to the students.  The default setting is control at the local level and the quality of decision making and delivery of outcomes shows how effective this is. The end results speak for themselves. The Finnish School Education System is the envy of the Western world. Businesses should learn the lessons from Finland. Unleash the potential in great people by resetting the default on strategy and decision making deeper into the organisation.

James Bowen and Brian MacNeice are co-authors of Powerhouse – Insider accounts into the world’s leading high-performance organizations, published in October 2016 by Kogan Page. For more information, visit www.theperformancepowerhouse.com.

They are also co-founders and Managing Directors of Kotinos Partners Limited, a niche advisory firm working to help CEOs and their teams achieve sustained high performance.


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