Accountability for the Bold of Heart: An Interview with Gerald Kraines
by Kali Saposnick
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How much time do managers spend doing what they were hired to do versus chasing after problems created in other parts of the organization? "I rarely hear figures greater than 50 percent," says Gerald Kraines, CEO and president of The Levinson Institute, a Boston-based consulting firm that offers programs and consultation services to improve the effectiveness of people and work systems. "In fact, because of lack of clarity around accountability at almost every level of the organization, most companies are delivering only a third of their potential."

What is accountability and why is it so important to organizational success? According to the definition in Gerry's new book, Accountability Leadership: How to Strengthen Productivity Through Sound Managerial Leadership, accountability is "the obligation of an employee to deliver all elements of the value that he or she is being compensated for delivering, as well as the obligation to deliver on specific output commitments with no surprises." In other words, as Gerry explains, all employees at every level are accountable for "keeping their word and earning their keep." Yet most organizations have not implemented a system to support them in making that happen.

For the past two decades, Kraines has been developing a principle-based, scientific approach to building accountability leadership systems. He has based his framework on the work of Harry Levinson, who created a sound body of knowledge about how to help managers effectively leverage their staff's potential, and Elliott Jaques, who has identified methods for objectively identifying the requisite elements of a managerial system and an organization's levels of complexity. Why is such an integrated approach crucial for today's organizations? "First," explains Gerry, "to get better business results. Business owners have a right to demand more value, and we have demonstrated that they can double or triple their results by implementing an accountability-based system. Second, to advance public health. In a healthy system, people can realize their individual potential and collectively yield the organization's potential, which can then be reinvested in our families and communities."

To implement such a system, however, takes a disciplined leader. "This is not for the faint of heart," Gerry concedes. "Developing a leadership system where managers deliver on their accountabilities and instill accountability in their subordinates requires people who are intellectually curious, who value leadership, and who are not afraid of the hard work it takes to get the system right."

The Cornerstones of Accountability
In his book, Kraines explains the four cornerstones of building an accountability leadership system: "LEAD"—leverage, engagement, alignment, and development. In this approach, managers are accountable for leveraging the potential of their people by engaging commitment, aligning judgment, and developing capabilities. Effective managers engage commitment by understanding what goes into a healthy psychological contract, a term coined by Harry Levinson in the 1950s to describe how managers understand and create the conditions necessary for people to feel supported and successful. Aligning judgment means setting context so that subordinates understand how their work jibes with the activities and goals of the larger organization and can act on that understanding. Developing capabilities begins with assessing people's potential and actual effectiveness and then coaching them to narrow the gap between the two.

To make sure the LEAD framework functions effectively, accountability must be attached to authority. In this sense, authority means the power to make decisions and to mobilize the resources necessary to effect those decisions. In order for managers to leverage potential, they must be given the requisite authority to fulfill their accountability commitments. When someone is given authority to do things without being held accountable for the result, or when someone is held accountable for the result without being given the requisite authority—Gerry calls these situations "managing for fantasy"; in neither case is the company able to accurately predict what it could produce nor is it able to reliably ensure that it will be produced.

If aligning accountability and authority at every level in an organization can leverage enormous potential, why aren't more companies doing it? According to Gerry, it's because accountability is poorly understood. Also, people often have difficulty with the words and definitions used to describe relationships within organizations, such as "hierarchy" and "subordinates." But he makes no apologies for using such terms, as long as they are clearly defined. "Elliott Jaques said that if people don't have clear definitions and consistent common understandings of what words mean, we will continually recreate the Tower of Babel," says Kraines. "He asked, 'What's the nature of a managerial system? What differentiates it from a partnership?' Well, partners are not accountable for other partners; they're collectively accountable. But in a managerial system, managers are accountable for what their subordinates do. And if a subordinate is also a manager, then the first manager must hold the subordinate manager accountable for his or her subordinates' effectiveness. That is an accountability hierarchy. So if that's what it is, why would you call it anything else?"

People also tend to equate the term "hierarchy" with bureaucracy, command and control, and rigidity. "That perception has emerged because we so often have to deal with bad hierarchies," says Gerry. "A good hierarchy is just the opposite; it creates the conditions in which people know what they're accountable for, they can exercise creative initiative, and they have the authority to be successful."

Another myth Gerry debunks is that "managers exist to support their people," a big fad in the early 1990s that he believes has helped to create a culture of entitlement in many organizations. "Good managers will support their people but that's not why the manager role exists," he says. "Managers' roles exist to get results and add value, and their subordinates are resources to help them get results and meet their accountabilities to the CEO, the board, and the shareholders. That's why I don't distinguish between leaders and managers. Leadership is mobilizing and elevating the efforts of multiple people to accomplish more than you could accomplish on your own. Every manager at every level, including the first-line supervisor of the operators on the shop floor, must be held accountable for exercising effective managerial leadership."

The Effect of Complexity on Accountability
Kraines says that the simplest reason why people misunderstand accountability is that our organizations have gotten too big, and we've not been able to handle the great complexity that comes with growth. When we're close to the action and it's our money, we have no problem holding people accountable. For instance, if you hire a carpenter to put an addition on your house, you probably won't pay her unless she completes the work. But when we grow so much that we can't employ all the workers ourselves, then things start to get a little fuzzy. Managers aren't dealing with their own money anymore, and accountability is no longer intuitively obvious. That's when we have to establish a clear accountability leadership system.

"It's not that big is bad and small is good," explains Gerry. "But if you try to operate when you're big in a way that ignores the basic principles of each small unit, then you end up with a mob, not with a clear, well-orchestrated, integrated system." He points out that nature took 500 million years to develop the human being and that most of our large-scale management systems have only emerged in the last 50 or 100 years—not nearly enough time for the underlying knowledge to be developed in systematic ways. Instead, our large managerial systems have evolved similarly to 200-year-old New England farmhouses, in which rooms got tacked on when families needed more space.

Kraines says that a kind of anarchy emerges when we don't understand the principles behind our organization's leadership system. Unsure to whom or for what they're being held accountable, managers learn to get ahead by working the system above. Since they usually don't know how to work the system below, they're imprecise in how they delegate accountability and authority to their subordinates. As Gerry explains, "The culture gets perceived as so bureaucratic that the motto becomes: 'It's better to ask for forgiveness than for permission.' For instance, in some companies, 'yahoos' and 'cowboys' ride roughshod over the bottlenecks to get the result. People condone the go-to gal who will always get it done by hook or by crook. Don't worry about the bleeding wounded or the way in which we've demolished any hope of having processes and process control."

The Look of an Accountability-Based System
"I don't blame the employees for this type of behavior," asserts Gerry. "I blame the shareholders—especially institutional investors—for putting up with it. The single biggest factor that prevents most of our organizations' managers from holding their people accountable is that they themselves are not being held accountable for doing so." He wonders why shareholders don't insist that the board hire a CEO who will establish a commonsense, no-nonsense, value-adding accountability leadership system and then hold the CEO accountable for making sure his or her subordinates hold their subordinates accountable.

Kraines acknowledges that this work isn't easy. In the beginning, it takes enormous effort to see all the components of the system and to gain confidence that you can get them working well together. Nevertheless, he insists that doing so brings huge gains. "You develop a culture that is a very focused, healthy place to work. People come to work with pride and a serious tone. There's transparency and straightforwardness in communication, no guile or hidden messages. There's no time or tolerance for politics. They can talk together in tough conversations where they attack the problem not each other. They're mature, have positive regard for each other, and support each other. It's a wonderful place to walk into."

Kali Saposnick is publications editor at Pegasus Communications.