Clear Words, Ambiguous Understanding

How many times have you provided one of your team members with directions for completing a task you needed their help with to get wrapped up by a certain time, but ended up with something far different from what you had hoped or missed the mark entirely? I’m sure we’ve all been on both ends of scenarios like that. We knew exactly what we meant when asking for help, but somehow it got lost in translation…

Think back to the four specific values I shared before - respect, integrity, communication, and excellence - and consider how much variance could creep in, even with such simple wording and relatively clear definitions included, if every individual involved had to decide for themselves exactly how they were to apply those in their respective roles. Then add all the other daily stresses of a to-do list, plus a fair amount of pressure to drive revenue in a way that makes a stockholder happy. I have vivid memories of watching the games that were played to make the quarterly numbers look good for Wall Street, and the company I worked for never came close to having a mess like Enron had. With the slightest bit of ambiguity around our values, even the fanciest definitions won’t do much to keep things from going really wrong - especially when the biggest rewards are going to the folks who are openly skirting the boundaries of those values.

To understand why so many organizations miss the mark, in exemplifying their core business values or even making sure everyone on the team even knows what they are, take a look how an article called “The Impact of Organizational Ambiguity on Performance Evaluation Metrics” opened:

Organizational ambiguity, often defined as the presence of uncertainty in decision-making processes, plays a significant role in shaping business dynamics. In a recent study by McKinsey & Company, it was revealed that over 70% of executives reported experiencing high levels of ambiguity during strategic planning. This phenomenon can affect everything from employee morale to overall productivity, with companies facing up to a 25% drop in performance when key stakeholders are uncertain about the direction of their initiatives. The story of a leading tech firm illustrates this point vividly; as they expanded globally, inconsistent messaging led to confusion among teams, resulting in a staggering $75 million loss attributed to misaligned goals and unclear expectations.

The concept of organizational ambiguity is not merely an abstract idea; it manifests itself in very tangible ways within organizations. According to a study published in the Harvard Business Review, organizations with high levels of clarity in communication saw a 32% improvement in employee engagement scores compared to those that struggled with ambiguity.

The organization that published this was focused specifically on the importance of providing clear feedback during performance evaluations (and how their product or service aided with that), and we’ll touch on that more soon. For now, let’s think about how unlikely it would be for folks in the organizations they studied to have much clarity when more than 70% of the executives admitted to “high levels of ambiguity”. John Maxwell’s famous quote, “Everything rises and falls on leadership,” immediately comes to my mind!

What do you think the chances are that, if you and I were operating under those four relatively simple values but felt tremendous pressure to achieve results - especially if we were aware of a “25% drop in performance” stemming from “uncertainty about the direction” of our organization’s initiatives - we’d have different ideas for how those values applied to the work we were doing? Even if your picture only varied from mine slightly, the difference in how we approached our work could be dramatic - and that’s assuming both of us actually knew what the core values of the business actually were. And that’s nowhere close to a safe assumption we should make.

As uncomfortable as I was when that happened, I shouldn’t have been surprised. As I shared before, I can’t list the stated values from the organization I spent nearly two decades with, and I was involved in the new hire onboarding process for three-quarters of that time! Even with a well-intended initiative to roll out values from the ivory tower (corporate office), George Bernard Shaw’s statement can ring far too true; “The single biggest problem in communication is the illusion that it has taken place.”

Even in a few of the cases where we discussed the organization’s values in detail with the manager or owner bringing us on site, we’ve still seen a lot of folks with the deer-in-the-headlights look when we’ve asked them to detail their company’s values; think back to the example I shared where those values were on the wall in the room and the participants still struggled to list them… With each of these situations fresh in mind, should we really be surprised with how things unfolded at Enron even with values as simple as respect, integrity, communication, and excellence? While each had basic and clear definitions listed to provide more context, I can certainly understand how other more immediate pressures could cause employees to bend each to fit what they felt like they had to do to hit their targets.

Before we dig into how seldom folks know the behavior required to meet expectations or what we can do to alleviate that problem, let’s consider what ambiguity is really costing our own organizations. I realize the article I referenced before that detailed a large tech firm’s “staggering $75 million loss attributed to misaligned goals and unclear expectations” may not resonate with most of us - since most of us aren’t working in large tech firms. Without knowing the name of that firm, who knows what percentage of their revenue or profit that represents? While we could write it off that easily, could you come up with a better way of using that $75 million, regardless of the percentage? Since I know that answer, let’s look at how we can connect those statistics to our own situation…

Ambiguity Carries a High Cost

Since that large tech firm’s “staggering $75 million loss attributed to misaligned goals and unclear expectations” that I’ve referenced twice now could be a bit more than you or I will experience in our own roles, let’s make it a bit more personal and consider what our numbers could be… First though, let’s look at the issue from a global perspective - just to remove any possibility of thinking this could never apply to us. Here’s how an article I found called “Why Ambiguity Leads to Lower Work Performance” opened:

Fear of the unknown is a natural emotion that is part of being human. However, when ambiguity is encountered in the context of work, the effects can be damaging to performance.

According to recent research, “Uncertainty about a possible future threat disrupts our ability to avoid it or to mitigate its negative impact, and thus results in anxiety.” Unfortunately, anxiety is a very common problem, affecting most, if not all of us, from time to time.

Taking steps to reduce anxiety in the workplace is not just a nice gesture, but one that protects an organization’s bottom line. According to the World Health Organization, anxiety can have a detrimental effect, costing nearly $1 trillion in lost productivity worldwide.

Now let’s think about the specific impact this has on our organizations when we leave room for ambiguity, specifically around the values that should be guiding our team’s behavior. The same article that detailed the $75 million loss and that 70% of the executives they surveyed admitting to ambiguity in their strategic plans also shared that “This phenomenon can affect everything from employee morale to overall productivity, with companies facing up to a 25% drop in performance when key stakeholders are uncertain about the direction of their initiatives.”

Many of the smaller businesses that Cindy and I work with operate largely on billable hours. For the first six or seven years of our business, that’s what kept our lights on too. In many of the other companies we support, contracts are based on completing large projects or providing a set amount of a specific product for an agreed upon figure. Regardless of how the terms are negotiated or how payment is made, some form of labor is involved in each. Let’s put ourselves in an imaginary world where the work all of our team members do during the forty hours they’re on the job each week is directly tied to what our customer pays for. How would our organization’s output change if those billable hours (or whatever they’re called in your specific situation) dropped by 25%, leaving you with just 30 hours contributing to what your customer’s paying for. We’d certainly see a large dip in the amount of anything we’re delivering, but we’d also see a massive hit in profit margin - because we’re still paying them for all forty hours and all of our other fixed costs are the same. 

I realize this analogy leaves you filling in many of the blanks, but I hope it paints a picture for just how quickly ambiguity can indeed hit the bottom line in any business. We all hope for top level performance from our teams, but far too often even the slightest bit of ambiguity can leave those team members wondering what that top level performance looks like and what they need to do to achieve it. Our responsibility as leaders lies in removing that ambiguity and providing clear expectations - and we’ll pick up there soon!