As a leadership coach, I often encounter leaders grappling with the immense pressure of their roles, especially when faced with challenging demands from their teams. A vivid example is a conversation I had with a CEO friend. Like many others, this CEO struggled under the weight of their responsibilities, particularly regarding demands for substantial changes in staff compensation.
The CEO confided, “I wish they could see that what they're asking isn't just impractical, it's practically impossible without fundamentally altering the nature of my business.” This statement opened a window into the CEO's dilemma: a strong desire to meet their team's needs but constrained by the realities of their business model.
Many leaders find themselves in a similar predicament, facing pressure from their teams for organizational changes. This often leads to isolation and the burden of bearing the brunt of operational responsibilities, creating a cycle of stress and dissatisfaction.
To break this cycle, we explored the "enabling constraints." This approach involves setting parameters that, while limiting in some ways, also spur creativity and autonomy. It acknowledges that resources are finite and that leaders can't promise the moon to their teams. However, by thoughtfully considering what can be influenced within these constraints, leaders can empower their teams to find innovative solutions.
In the case of my CEO friend, we devised a strategy to shift the narrative from centralized responsibility to shared leadership. We established a budget for raises governed by a few key constraints:
- The budget would increase annually by a baseline percentage, primarily to account for inflation.
- The percentage increase would depend on the state of the economy and the company's performance in three key areas: customer satisfaction, jobs completed, and new jobs acquired. Teams were encouraged to suggest alternative metrics if they were better aligned with organizational goals.
- Senior leadership was allowed to influence the budget. For instance, increased customer satisfaction leading to additional work could result in more funds for bonuses.
- Accountability was also a part of the equation. If a budgeting error occurred, senior staff would be responsible for rectifying it, with support and coaching from the CEO.
This approach is a form of "federated responsibility" communicated through enabling constraints. We opened up new possibilities by adjusting the CEO's mindset from being a gatekeeper of financial governing constraints to an enabler of creative solutions. Not only did this alleviate the need for constant difficult conversations, but it also empowered the staff to adapt, innovate, and lead effectively.
In essence, enabling constraints can transform how leaders and teams interact, reducing stress and tension while scaling leadership effectiveness. By embracing this concept, leaders can foster a culture of shared responsibility, creativity, and adaptability, leading to a more resilient and successful organization.