Jeffrey Saltzman's Blog

Enhancing Organizational Performance

Rings of Confidence – Aggregation of Attitudes

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What are your fears? What is keeping you awake at night? Within the context of the current economic environment, these are questions that I have asked various groups that I have been interacting with or speaking to. It gives a way to set the stage for a discussion on how each individual aggregates up into larger and larger groupings, representing organizations of increasing size and complexity and how the psychology and behavior of those organizations are shaped by the individual group members. If everyone or a critical mass of those in a group or organization is sharing the same fears, or being kept awake at night by the same concerns, the behavior of the group or organization will be reflective of those fears or concerns. When that group is consumers, in aggregate responsible for about 70% of the economic spend or GDP of the nation, and that fear is loss of income, the results may indeed be dire.  

Think of an individual, let’s say a pharmacist. This individual works diligently at her profession day-in and day-out, dispensing needed medicines to their customers. This pharmacist has a direct impact on the lives of the people she interacts with, dispensing the drugs that help them heal and they are thankful (usually) for that. This pharmacist belongs or is a member of a number of differing organizations or loosely categorized groupings of people. For our purposes here  lets define organization as a group of people that share a common purpose or certain characteristics, a purpose or characteristic that can be either formally recognized, such as being a member of a company or governmental agency, or an organization that may not be as formally configured, such as all licensed, actively working pharmacists. Whether they belong to the same company or not they are members of a group, a group of pharmacists that in this case have something in common – being pharmacists.

As pharmacists, part of their worldview will be shaped by the education, experiences and training that pharmacists tend to have not to mention the day-to-day work that they perform. And the pharmacist’s worldview will shape the way pharmacists behave.  If for whatever reason the pharmaceutical industry collapsed because people suddenly no longer became ill and hence no longer needed to go to the pharmacy to purchase medicines, then pharmacists as a group might become worried about their continued employment and would then behave accordingly, cutting back on spending and perhaps hunkering down until they knew for certain what was happening within their industry. We are not saying that all pharmacists share the same exact worldview, for you certainly can find a glorious diversity of pharmacists including republican pharmacists, democratic pharmacists, male pharmacist, female pharmacists, single or married ones, heterosexual, gay and lesbian pharmacists, tall pharmacists, short pharmacists etc. each with their own worldview, but as pharmacists they will share, in spite of their diversity, some similarities in certain aspects of their worldview. For instance maybe how much they pay attention to healthcare issues, or the importance of healthcare issue to them, compared to non-healthcare workers, and that will take shape from the very nature of them being pharmacists.

What I will argue though is that an individual pharmacist working in a drug store has a pretty good idea about what is happening with respect to the prescription business in that store and as an aggregation these drug store pharmacists have a pretty good idea about what is happening in the pharmaceutical dispensing industry across drug stores. While any one pharmacist might not have a complete picture, if you draw a representative sample from the universe of pharmacists appropriately and ask the right questions you will be able to unlock insights into what is happening within that industry. And you are likely to unlock those insights prior to that information becoming widely known through more traditional reporting mechanisms for pharmaceutical dispensing organizations such as drug stores. For you see pharmacists working in the trenches know if there is a flu epidemic going on by what they see happening day-to-day, and they will know it before the traditional inventory systems that the stores use to aggregate their sales results and report that higher than expected amounts of various prescriptions for flu symptom treatments were filled in the preceding month.  

If we think of this one drug store pharmacist as being in the exact center of concentric rings, each larger ring representing a larger entity to which this person belongs, we would have a progression: the individual, an employee working in a specific drug store location, an employee of a drug store chain, a member of the health care industry, a resident of a specific state or certain area of a country, a citizen of the USA or another country and a human being living on planet Earth. Membership in some of those groupings or organizations is by choice while others, such as being a citizen of the USA may happen simply due to randomness of birth. Each individual in our sample is at the exact center of their own set of concentric rings, representing the various groups of which they are members. And just to complicate things each individual can be the exact center of multiple sets of concentric rings. So in this case we are starting with the individual as a pharmacist, but other characteristics of the individual could be our starting point so we could also start with that same individual as a mother, or father, or member of a religious organization, political party, volunteer firefighter, etc.

If you were to randomly select a grouping of people that are representative of the concentric ring level in which there is an interest (pharmacists, members of the health care industry, or citizens of the USA etc.), meaning that the selected sample is a decent representation of the total universe of people who reside in that ring, you would gain insight into the thoughts, feelings and attitudes of all the members of that ring. Whether that insight means anything significant will be dependent on the questions you choose to ask and how you go about analyzing and interpreting the results. The impact that can occur with the findings will depend on what one is able to do with them.

With this concept in mind, the notion of selecting a cross section of working individuals to gain insight into their concerns and by extension into the larger concentric rings to which they belong was born. This is the methodological concept behind how aggregating Employee Confidence information starting at the individual level can shed light not only on that one person’s fears, or causes of sleeplessness, but among the other levels of interest such as company level performance, i.e. the company of which they are a member, industry performance, i.e. the industry to which their company belongs, country-level macro-economic factors, i.e. the aggregation of a cross-section of organizations from within a country, and global economic conditions, i.e. an aggregation across the largest economies of the world.

Traditionally, when conducting employee research there is an effort to link the findings of the employee survey to organizational performance results, the one organization to which the employee belongs (also typically the entity that commissioned the work). It can be determined for instance that employees, who perhaps have higher levels of pride in their organizations, are producing higher levels of customer satisfaction among the customers with whom they interact. If that finding is strong, any organization would be somewhat foolish not to consider what activities they could undertake to increase the levels of pride that the employees have towards the organization for it is well known that higher levels of customer satisfaction produce more sales.

What has been shown in recent Employee Confidence work is that the linkage between an employee’s attitudes not only affect their behaviors at the individual level (e.g. how they interact with customers), and rollup not only to organizational performance (increased or decreased sales for instance), but these attitude in aggregate can also be shown to link to cross-company industry level results, a meta-linkage, as well as country level macro-economic performance measures, and if we take a leap of faith global economic performance.

Our approach to measuring Employee Confidence suggests how Employee Confidence and more generally Confidence can be used to improve organizational performance, of any type of organization, at any level of the concentric rings, and how by methodically working to restore Confidence we can affect each of the concentric rings, thereby restoring Confidence in our organizations, our economy and global economic performance.

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