strategy+business is published by PwC Strategy& LLC.
or, sign in with:
strategy and business
 / Autumn 2010 / Issue 60(originally published by Booz & Company)


Getting Tensions Right

Barrett created a right fight over one of the most important tensions that exists in any large, complex company: how to make the whole more than just the sum of the parts. He used tension deliberately, aiming it squarely at improving the team’s effectiveness in driving the bank’s performance.

These CEOs have in common a focus not just on the right tensions, but also on using them in the right way: to move things forward, to energize, to spark new thinking, to wake people up! This is how they transformed their companies into great performers.

No business can escape the three performance tensions that pull it in different directions. Any top team or board that tries to ignore them is fooling itself and taking productive tension out of the company.

Test the Tensions within Your Board and Top Team

  • How much time in your boardroom and with your top team is going toward the right tensions?
  • How well are performance tensions being addressed by your strategy?
  • How well do dissent, different views, and competing ideas surface, get discussed, and get productively decided?
  • How good is your board’s or team’s alignment? Is it strong enough and focused enough to support right fights fought right?

Making Tensions Work for You

When CEOs, top teams, and boards are operating too close to either extreme of the relationship spectrum, at least one of three situations is nearly always present: The right tensions may be sitting under, rather than on, the surface. They may be recognized, but are not being resolved in the right way. Or there may be insufficient alignment around the foundations of high performance, such as vision, mission, goals, and facts.

The first step in replacing unproductive tension with productive tension is to embrace the reality of the often-conflicting demands that a company can never fully avoid. As we saw with Sunderland, Bobins, and Barrett, a productively tense dynamic at the top of a company keeps the most important tensions on the surface at all times for all to see. It calls for more growth and higher profitability; it spells out goals for short-term results and investment for long-term sustenance; and it addresses how the company will be more than just the sum of its businesses without undermining the accountability of those businesses and their ability to perform individually. This helps the entire company stay focused and prevents less-important matters from taking over the agenda.

But although keeping the right tensions on the surface at all times is the first step, it’s not the whole story. Right fights fought badly usually produce terrible results, leading to volatility, unpredictability, and the loss of energy and momentum. The idea is to pick the right fights, put them on the table, and then fight them in the right way.

For example, when Rolf Classon took over as CEO at a large health-care company, he unexpectedly found himself facing a very tough call. The company was far down the path of considering an acquisition that would make it a dominant player in its market. The deal had been blessed by the former CEO, and the entire top team appeared to support it. But shortly after he took the job, Classon discovered that there were real doubters among the team members, including people whose opinions he respected.

Classon called together the team and told them he was uncertain about the acquisition. Some were angry — they thought it was a done deal. He invited all of them into a blunt, no-holds-barred discussion. He told them he didn’t know the business and that this would make him a fair referee. His own mind was not made up. He wanted to know what the team thought and to have them dig deeper into the substance of the reservations that many felt but hadn’t vocalized — questions for which there were no clear-cut right or wrong answers.

Follow Us 
Facebook Twitter LinkedIn Google Plus YouTube RSS strategy+business Digital and Mobile products App Store


Sign up to receive s+b newsletters and get a FREE Strategy eBook

You will initially receive up to two newsletters/week. You can unsubscribe from any newsletter by using the link found in each newsletter.