Upward feedback leads to culture change - Fiat S.p.A - includes related article

HR Magazine, June, 1994 by Enrico Auteri

Fiat is improving performance and productivity by taking a hard look at how managers are viewed by subordinates and redefining the role of managers.

To create a culture that responds to rapid competitive changes, Fiat S.P.A. developed a leadership program that would train managers to direct associates (employees) and work in the following ways:

* Maximize employee effort and channel it in the desired direction.

* Obtain ideas from staff and ensure that they actively participate in continuous improvement.

* Accept changes in culture that employ cross-functional work processes and develop total quality principles.

* Facilitate functions of new "flat structures" (processes, teamwork and so forth).

Starting in early 1990, all senior managers participated in progressive leadership courses developed by ISVOR (Istituto per lo Sviluppo Organizzativo), Fiat's management training center, in collaboration with a team headed by outside consultants. The two-module, four-week training period includes elements such as self-evaluation and evaluation by associates.

The training is only a preparatory phase in bringing about change. In fact, along with the leadership courses, Fiat's human resources department developed a more focused tool called Management Style Analysis (MSA), which uses direct experience and concrete facts to provide managers with even greater assistance in assimilating the new leadership style.

PROGRAM OBJECTIVES

The Management Style Analysis (MSA) project monitors and reinforces leadership skills and, more generally, the ability to manage and develop human resources. The cornerstone of MSA is a structured evaluation of managers by their staff. The subject of these evaluations is specifically limited to how managers exercise their leadership and how effectively they guide, manage and develop their staff. Associates' opinions on such matters as the correctness of the manager's strategic choices and entrepreneurial effectiveness are not requested, nor are they accepted when offered.

However, during the first phase, those who supervise the managers deliberately refrained from giving them feedback in order to obtain maximum training effectiveness and take full advantage of the powerful, innovative impact of "evaluation from below."

MODEL FOR FIELD ANALYSIS

Management style analysis concentrates specifically on two core concepts: professional leadership and transformational leadership. Professional leadership is based on the concept of purposeful pursuit of objectives, with simultaneous attention to the motivation and development of the individual. It is rational and pragmatic, delegates authority freely rather than exercising it rigidly, takes pains to be clearly understood, listens carefully and emphasizes dialogue, is nonbureaucratic and open to suggestions.

Transformational leadership goes beyond the previous paradigms of change and adaptability, developing the leadership qualities of the associates by relying on four principles that are geared to transformation:

1. Individualized consideration, or hands-on management that is responsive to the needs of the individual.

2. Intellectual stimulation, or the leader's ability to stimulate his or her associates to think critically and creatively, rather than resorting to trite solutions and regimented customs and practices.

3. Inspirational motivation, or the ability to fully mobilize the collective energy to achieve important goals, fueling confidence and enthusiasm even during moments of crisis and communicating the sense of the mission, which stems from the manager's own vision.

4. Idealized influence or the leader's ability to be a model and an example through emotional involvement and the psychological mechanism of identification, used not for the negative purpose of "moral subjugation," but for the positive aim of stimulating development.

Chart 1

Manager Skills

                         Today     Tomorrow     Difference

Organization             3.43        4.60         -1.17
Communication            2.38        4.59         -2.21
Decision making          3.40        4.58         -1.18
Team management          3.03        4.57         -1.54
Collaboration            3.16        4.50         -1.34
Leadership               3.15        4.50         -1.35

Motivation and
development of
associates               3.16        4.46         -1.30
Management of change     2.92        4.36         -1.44
Planning                 3.02        4.36         -1.34
Negotiation              3.45        4.20         -0.75
Problem analysis         3.59        4.09         -0.50
Problem solving          3.88        4.00         -0.12

The profile must not be read in terms of the objective set for tomorrow, which
may be regarded as a general target for every item, but rather with respect to
the greater disparities between the skills that the manager has today and
those that he or she must have, seen as a measure of enrichment.
Chart 2

Qualities of a Manager

                         Today            Tomorrow            Difference

Flexibility              3.26               4.61                -1.35
Openness                 3.19               4.59                -1.40
Creativity               3.02               4.50                -1.48
Achievement              3.89               4.43                -0.54
Determination            4.26               4.38                -0.12
Reliability              4.19               4.33                -0.14
Positiveness             3.40               4.18                -0.78
Equilibrium              3.68               4.17                 0.49
Autonomy                 2.88               4.07                -1.19

The profile must not be read in terms of the objective set for tomorrow, which
may be regarded as a general target for every item, but rather with respect to
the greater disparities between the skills that the manager has today and
those he or she must have, seen as a measure of enrichment.