Many leaders long for the days when they knew exactly who in their organization was responsible for what, when teams weren’t working on parallel tracks, and when they didn’t have to peruse a phonebook-thick organization manual to figure out what they could and couldn’t do. Tony’s organization, therefore, represents a return to the days of clarity and simplicity. It also largely avoids the problem with the traditional approach: being too simple to deal effectively with all the gray issues that arise.
As you watch Tony and his people make money, you marvel at the clarity of their work processes. Someone is always unambiguously in charge. Everyone knows who to go to for help or for a decision. The captain and his crew know their targets and move toward them quickly and efficiently. This is in contrast to many organizations where the goals or expected output aren’t clear. I know one organization that spent months developing ten key-performance indicators, but the measures of those indicators were so complex that no one could follow them. The company ended up revising that list the next year, but at the end of that year when it was time to give out the bonuses attached to those indicators and measures, people began disagreeing with the measures and the data associated with them.
Tony’s structure also addresses the issue of unclear accountabilities. In organizations with complex or matrixed structures, people find places to hide or scapegoats when things don’t get done. Multiple reporting relationships or teams with shared responsibilities make it difficult to discover who is in charge and who can make a decision. While matrix organizations are very useful in certain ways, they also require clarifying and reclarifying roles, accountabilities, and decision-making authority. They can muddy the decision-making waters in conflict-averse cultures, for no one wants to acknowledge that one individual has more power than the other. As a result, decision-making power is shared, and this results in coleadership situations, the type that Tony despises (as seen, for example, when it was suggested he share power with Junior).
Accountability is much clearer in Tony’s group. Profound consequences exist when you fail to do what you’re supposed to do or you do something that is taboo. While I’m not suggesting that employees be shot in the head for failing to complete an assignment, a small but healthy amount of fear is a strong motivator. Today, in some organizations, people often aren’t particularly afraid of being fired for it takes a significant amount of documentation to terminate someone. Raises and promotions tend to be smaller these days, so fear of not getting a big bonus isn’t the motivator it once was. Nonetheless, in the right system, bosses can set specific consequences tied to accountability that cause direct reports to "respect" their responsibilities. By clarifying roles and establishing negative sanctions for playing out of position or being a lone wolf, leaders can increase the odds that people will do what they’re supposed to do. As long as there’s no ambiguity about these consequences—the organization doesn’t promote great individual contributors who refuse to play on teams, for instance— then people will respond positively.