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  • Mark Shaw

The 2% Effect – A Case Study

Catching up with a friend for Christmas the conversation turned to work.

My friend (I’ll call him Chris- not his real name) explained that 2015 had been a great year with his division delivering a 15% after tax profit to the business and plans for a four-fold increase in revenue being developed for the future.

“That’s great” I said “You must be really happy at work”.  “No I hate it”, Chris said, “I’m thinking of leaving”.

As we discussed what was happening it seems he loves his work, his contribution to the business and the plans for the future.

And all of this was overshadowed by one employee in the team who I’ll call Bill.

Chris then told me in about 10 minutes that in the past 12 months:

  • He had been commissioned to implement major changes 

  • He accepts his management approach is direct and he expects staff to do their job

  • Bill was not pulling his weight in terms of the changes

  • No-one wants to work with Bill but they have to.

  • He believes the problem is that Bill does not agree with the changes

  • Bill had formally and independently accused Chris and his manager of “bullying”

  • Chris’ manager was formally reprimanded for not successfully managing the disharmony in his team (i.e. Bill’s disruptive behaviour)

  • Chris’s other work colleagues believe neither Chris nor his manager had done anything wrong.

  • The involvement from HR did not solve the problem.  In fact it has led to increased staff dis-engagement.

  • Chris’ frustration has been the way the organisation (and specifically the HR Department) has failed to help manage the situation

  • Chris, his manager and two other team members are all thinking of resigning because of Bill.

I explained how this was a classic case of The 2% Effect, i.e. His company created rules for the small percentage of people who break the rules (i.e. Bill) and that small percentage of people who break the rules, will always break the rules (Bill). Further Chris agreed he knew the name of who currently breaks the rules (Bill) and yet all the rules have done is get in the way of the people who do not break the rules (everyone but Bill).

What was incredible was how Chris and I then discussed the cost impact of Bill and The 2% Effect to his own business.  We calculated that if Chris, his manager and the others leave; recruitment costs are incurred, profitability would drop from 15% to about 7%, and Bill will still be there causing problems.  Over a beer, we estimated the cost to the business as at least $700 000.

In less than 15 minutes and without complicated policies, procedures and processes we:

  • Identified a $700 000 problem

  • Proved why the current policies and interventions had failed

  • Identified a solution with 20 years proven success.

This case provides any reader with the necessary business case to make a change.  The challenge I leave you with is who is prepared address similar problems in their organisation and solve them? 

It is very achievable if you try.

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