Do We Need to Extend ‘No Surprises Management?’

Summing Up: Jim Heskett's readers agree that 'no surprises management' should be practiced by bosses as well their direct reports.
by James Heskett

Summing Up

Why Not Turn "No Surprises Management" On Its Head?

If "managing up" with a "no surprises management" (NSM) philosophy is popular, "managing down" with NSM makes just as much sense, according to respondents to this month's column.

As Dan Wallace commented, ''No Surprises Management seems pretty obvious. Why in the world would you want the people you're counting on to help you achieve your objectives to be blindsided?" Roger Studer added, "Take care of those who take care of you." Bob Gunsallus put it this way: "Once you get to the top, quality people keep you there."

Other respondents helped develop a kind of construct for NSM, one encompassing a number of other management behaviors. For example, Gerald Nanninga couched his support in these terms: "This is not just about trust … this is about respect … keeping employees in the dark and constantly surprising them is a serious form of disrespect." Bert Baker linked it to integrity with this comment: "When I know that my manager is a person of integrity, then I know they will not surprise me… My working definition of integrity is: what you believe is what you say is what you do."

Larry Slate, in commenting on how NSM works in his organization, said, "Employees are expected to (be) 'dedicated, professional, accurate, and ethical.' As employees we expect the same from management." Ashok Jain added, "When senior management practices NSM, they are able to build affective engagement with their employees … in creating a learning environment where each employee feels respected and fulfilled in an environment of trust.'' Kim Forbes observed, "This ties in nicely with Servant Leadership.… Treat your organisation's people with respect and understanding. The payback is impressive."

Several commented on the demands that NSM places on management in an uncertain environment and the need for communication. For example, Amitava commented that NSM is a good idea but might take some time to implement. Kamal Hossain put it this way: "When the world is full of surprises …bosses can hardly control drastic actions to keep surviving and that means employees will get their share of surprises … However … a good leader will always communicate … all possible outcomes of decisions, both positive and negative …" Mira added: "A world without surprises or bad news is utopian… I often coach employees to expect the worst and prepare for it… studies should focus on preparation rather than prevention." Paul McKay commented that "By having a clear, focused strategy that is well communicated throughout the organization, and by having all activities aligned with that strategy, the chances of surprises is greatly diminished." And Yadeed Lobo said that it is important for leaders to set expectations early on.

A question appeared to be posed by Gauray Goel when he commented, "downwards NSM is more of a symptom of competent managers than (a) cause of good performance…" Another may have been provoked by Kapil Kumar Sopory when he offered the opinion that "NSM is an ideal concept. However, it will work upwards only if it is first crystalised upside down." Why not turn "no surprises management" on its head? What do you think?

Original Article

Managers often tell their direct reports, "I don't want any surprises." No surprises management (NSM) is a term long associated with the idea that the best way to succeed is not to surprise your boss. Better that superiors should be informed early on of such things as expected shortfalls in performance, changes in tactics, new information impacting a business, and the like. The intent is to flag potential problems early on so that help can be provided in planning a response.

In reality, employees too often cover up or are reluctant to risk carrying bad news up the chain of command, making a bad situation worse.

What if the NSM concept was extended downward, to entreat managers not to surprise those reporting to them? The potential benefits were suggested by research I carried out for my book, The Culture Cycle. In it, I compared data collected from the offices of a large marketing services firm to which I had been given unusual access. Here are some data from employee engagement studies, human resource reports, and financial statements that the company shared with me:

Office 1 Office 2 Office 3
In my office, senior leadership's actions are consistent with what they say 46% 54% 67%
I know what is expected of me at work 91% 76% 94%
In my office, management is trusted 46% 30% 69%
Employee engagement index (five is highest) 3.93 3.53 4.17
Two-year average annual employee defection rate 32.3% 21.3% 19.2%
Two-year average annual client defection rate 37.8% 48.4% 31.7%
Two-year average annual operating profit as a percentage of revenue 13.3% 3.7% 22.5%

This data suggests (without proof of cause and effect) that significant improvements in performance can be associated with leadership that produces no surprises for those lower in the organization.

Senior managers who practice NSM apparently create few expectations among their employees that go unmet. Training and development commitments to employees are kept. Decisions agreed upon in meetings are implemented. If expectations are not met, employees are informed with a timely explanation of reasons for the shortfall. Relatively small differences in the degree to which expectations are perceived to be met and trust established appear to be associated with significant differences in operating performance.

This raises questions for us as leaders. Once we establish expectations among our direct reports, do we try to make sure that we meet them all? Where it is not possible, do we attempt to provide reasons in a timely manner? What levels of trust does your leadership create in your organizations? How do you know? What, if anything, might you resolve to do to measure and remedy low levels of trust? Do we need to extend the "no surprises management" philosophy? What do you think?

    • Gerald Nanninga
    • Principal Consultant, Planninga From Nanninga
    This is not just about trust...this is about respect--a deeper, more powerful emotion. Respect is a two-way street. If you don't respect your employees, don't expect them to respect you. And keeping employees in the dark and constantly surprising them is a serious form of disrespect. And when employees reciprocate with their own disrespect of you, you get disloyalty, defections, back-stabbing and lower levels of performance.
    • Kim Forbes
    • Planning & Performance Manager, New Zealand Institute of Chartered Accoutnants
    This ties in nicely with Servant Leadership. Do not treat staff as a resource that can be shunted and discarded at will. Treat your organisation's people with respect and understanding. The payback is impressive. The alternative is potentially catastrophic to your business.
    People are our work family. Imagine a family with secrets, concealment, distrust and lack of respect; dysfunctional. That is what you get without trust and repsect; a dysfunctional business, low profitability, high staff turnover, cost, cost, cost. Then you wonder why you cannot get ahead or get the time you need for a holiday and so on.
    • Roger Studer
    • Gen Mgr (retired), A E Petsche Co Inc
    Take care of those who take care of you.
    OPM 6
    • Larry Slate
    • Organ Preservation Supervisor, Gift of Life Michigan
    This is a topic I have been discussing lately with the senior leadership in my workplace. Employees are expected to "dedicated, professional, accurate and ethical". As employees we expect the same from management.
    The University of Michigan hospital has a program to engage all employees in such conversations. The program is called, "Expect Respect".
    • Gaurav Goel
    • Manager, Deloitte Consulting
    I think that competent managers have better control over plans and activities of their teams and have a good grasp on the external factors impacting their teams. This means that they are better positioned to define the tasks and keeping the teams informed of what is expected from individuals. There would also be fewer changes in plans. I am leaning towards an opinion that downwards NSM is more of a symptom of competent mangers than cause of good performance.

    Having said that, this can be a good benchmark for managers to assess their effectiveness and determine the focus areas to improve the same.
    • Deepti Bhatia
    • Senior Software Engineer, HSBC
    Trust comes only when there is transperancy. Where there is trust improvements in performance can be associated. This brings out the best in employees at any level of organisation.

    When we say that the leadership should not produce any surprises for those lower in the organization, it basically does not mean totally. Surprises that can enhance the employee performance should be disclosed which will help gain trust and more productivity. This will in return reflect to bosses as "No Surprises" from their direct reports.
    • Kamal Hossain
    • Faculty of Business, London School of Commerce
    Prof Heskett
    Thankyou for this important question. I believe that a trust is a key ingredient for a healthy relationship that lasts long. Hence, an employee being happy in the same company for a long time can happen if there is mutual trust between the employee and the boss. The trust can build when there are as little as possible negative surprises.
    But when the world is full with surprises like economic downturn, job cuts, pay cuts, inflation and many more then bosses can hardly control drastic actions to keep surviving and that means employees will get their share of surprises. However, I believe that a good leader will always communicate of all possible outcomes of decisions, both positive and negative and thus make sure there are almost no surprises.
    Kamal Hossain
    Faculty of Business
    London School of Commerce
    • David Physick
    • Consultant
    My boss at the bank where I used to work as Customer Relations Director said to me on my first day after taking up the post. "Your job is to prevent me breaking my jaw when it drops open on to my desk as a result of my getting a phone call from a (Government) minister or newspaper editor to tell me about some cock-up we've made. Do you understand?" I did. We got on famously. His jaw remained in tact. Now the bank is criticised for operating a culture of "no bad news". As a result, its reputation is severely damaged because no one is prepared to tell their boss the honest truth. Brushing bad news under a carpet creates a big hump that someone all falls over and causes more harm than if the matter had been dealt with fully and properly at the outset. The problem of the NBD culture is that the resultant climate, i.e. how people feel, is lousy and performance is seriously harmed.
    • Bert Baker
    • Manager, Belcan Engineering
    To me, the survey's three questions: "senior leadership's actions are consistent with what they say," "I know what is expected of me," and "management is trusted" all get at a deeper issue than "No Surprises." I see these as all tied up together in a question of integrity. Are managers people of integrity, is the organization an organization of integrity. My working definition of integrity is: what you believe, is what you say, is what you do. When managers and organizations have integrity, the organization prospers. When I know what my manager is a person of integrity, then I know they will not surprise me.
    • Arti Khanna
    • HR Professional
    I absolutely agree with the concept of NSM, as it maintains the transparency in the system, which in turn strengthens the trust of employees in management and vice-versa. Keeping critical incidents like shortfall,unmet training needs, delayed salary,etc as confidential give rise to unnecessary rumors and anxiety among the employees that give rise to grapevines which is not at all an healthy environment and that would would adversely affect the performance of the employees
    • Sowmia gopinathan
    • strategic account manager, D&B
    The discussion holds true in most companies. The requirement is of a proper communication management. Any employee would be open to change as long as the communication is clear and timely. A positive or a negative surprise comes along in all business environments. It is more about how the same is communicated and what culture is maintained by the leaders of the company/team, which ultimately boils down to each and every member of the organization.
    • Mira
    • Management Consultant
    A world without surprises or bad news is utopian. Constant and multi-channel communication, encouraging and coaching employees to plan their lives and manage their expectations is useful in buffering inevitable surprises. In this fast paced world managing oneself is critical, and no longer an option. I often coach employees to expect the worst and prepare for it. That way the BIG surprises are not terrifying and the LITTLE ones are inevitable so brace for it. In other words be absolutely realistic about work and life. Both produce shocks and surprises, and studies should focus on preparedness rather than prevention.
    • Walter P. Blass
    • Retired Director-Strategic Planning, A.T.&T. Corporate Headquarters
    When I first took on this position I read that my counterpart at Gulf & Western espoused "NSM". He felt it was his duty to keep the CEO from being surprised. In my subsequent 15 years of experience in that role both at NY Tel and the parent company, I asked each VP to keep a separate diary with only items that surprised. The results were quite amazing: almost no facet OUTSIDE the company was listed as a surprise; they had read almost no books; their friends never seemed to suggest surprising topics. Given how much a telecomm company is at the mercy of social/economic/political trends, I was quite astounded. Compare that with a friend at the Institute of Life Insurance who organized a twice a year symposium of strategic planners in their membership to go over "new" developments, surprises in the literature, etc. I wonder whether too many NSM managers simply try to avoid being surprised, even when they need to
    be! I view the decline of AT&T as symptomatic of senior managers who are blind to the "handwriting on the wall."
    • soma
    • Manager, Bank
    I agree that in business there should not be a surprise element especially about critical matters so that the problems can be arrested on time.Sitting on a bomb and waiting for it to explode is not appreciable by any means. Matters of concerns must be communicated bothways- Top to bottom and bottom to top hierchy ( wherever applicable ) in order to resolves issues as a TEAM. Transparency only increases mutual trust and it is the Bosses who ultimately inculcate the NSM culture by walking the talk.
    • Amitava
    • Manager, hp
    NSM is a good idea but might take some time to implement this successfully as practice. I am confident that many of my colleagues across organizations are practicing this though some would be reluctant to follow this idea! The persons who understand the difference between a "manager" and "leader" would follow NSM spontaneously and would promote the idea of NNM (No Nonsense Management).
    • Ashok Jain
    • Freelance Consultant, Hope Learning Solutions, New Delhi, India
    When senior management practices NSM, they are able to build affective engagement with their employees, which goes beyond cognitive engagement in creating a learning environment where each employee feels respected and fulfilled in an environment of trust.
    Employees work as full human beings whose productivity is not limited by their functional identity. This is reflected in high employee engagement index and higher operating profit as percentage of revenue. The organization is perceived as one that follows 'long termism' - lower client and employee defection rate is a natural corollary of that.
    • Paul McKay
    • Gen Mgr - Business Improvement, Alabama Gas
    By having a clear, focused strategy that is well communciated throughout the organization, and by having all activities alligned with that strategy, the chances of "surprises" is greatly diminished. When a new activity is introduced to employees, by employees knowing the strategy and by seeing that the new activity is alligned with the objectives of the company, the expected reaction should be "makes sense" rather than "what are they thinking!"
    • Bob Gunsallus
    • Business Owner, Premier Window Fashions
    Absolutely!! As we were building our company, as entrepreneurs (my wife and I) we developed a handbook, on hands training, carefully developed a trust for all who worked for us. Encouraged our employees to submit ideas that would help us improve our manufacturing. Award those ideas with perks not normally associated with hourly employment. Our company grew from 4 employees to over 140 in 9 years. Once you get to the top, quality people keep you their. Good article, good questions. Thank you.
    • Kapil Kumar Sopory
    • Company Secretary, SMEC(India) Private Limited
    No Surprises Management (NSM) is an ideal concept. However, it will work upwards only if it is first crystallised upside down. Leaders and managers need to have close and transparent interactions, on regular bases, with their teams so that proper understanding of every happening develops and each one appreciates the other. Close-knit teams deliver the best results as the scope for "surprises" is greatly minimized even if not eliminated altogether.
    Much depends on the leadership style of the boss as his juniors would behave in a parallel fashion, coming out timely with developmental and other news without fear or hiding such news- good as well as bad- as long as possible.
    • Dan Wallace
    • Partner, Tailwind Discovery Group
    Jim, this feels like deja vu all over again - especially regarding your previous discussion on "Servant Leadership."

    There is one "right" way to lead and manage. It starts treating the people who report to you (and everyone else) with dignity and respect. The basis for that is the recognition that they are not 'inferior' to you, but simply occupy different roles. Every role is critical - the team is only as strong as its weakest link. (I once ran a small specialty lending company. When asked why I was putting a performance management and incentive comp system in place for the hourly workers before the salaried staff, my answer was simple: "I can disappear to our LA office for a week and no one will miss me. But if we don't open the mail, we don't work.")

    Your job as a leader starts with making sure that the direction of the organization is crystal clear, and that the lines of responsibility and accountability are as simple and clear as possible. Next, make sure that each seat is filled by someone who gets the job, wants the job, and has the capacity to do the job brilliantly, and that everyone understands how each seat contributes to the achievement of the organization's goals. Once that's done, you need agreement about exactly what each person is going to accomplish by when in order to move the team down it's path (I like doing this via quarterly goals that are developed collaboratively; they shouldn't be imposed from above). And you need to make sure all of your people have the resources they need to get the job done.

    After that, YOUR job is to get the hell out of their way and let them do THEIR jobs, being available to help when needed. "Help" mostly means coordinating, resolving conflicts, breaking ties, and using the resources at your disposal to get obstacles out of your peoples' way. If you have to do more than that, you've made a hiring mistake. "Help" absolutely does not mean doing their jobs for them.

    In that context, "No Surprises Management" seems pretty obvious. Why in the world would you want the people you're counting on to help you achieve your objectives to be blindsided?
    • Yadeed Lobo
    I think it is important for leaders to set expectations early on.

    Perhaps we could borrow a leaf from the Chairman of the Federal Reserve's conduct of monetary policy.

    The meetings of the Board minutes are made available. For all practical purposes these should be sufficient. But as analysts from different large investment firms could interpret this information in different ways, it is the statement and speech of the Chairman that appears to drive behavior.

    It is this clear setting of expectations and where the economy could be headed for the foreseeable future, which conveys optimism or pessimism in the United States and, by that token the world economy. Its almost as if the financial sector as an institution (which allocates capital to its most productive uses) takes its cues for confidence or temerity based on a single speech.

    The outcomes of this setting of expectations are evident in the movement of asset allocations.

    There might be one other thing that organizational leaders badly need as stated by Prof Heskett. The onus to follow through.

    As an example, the Chair said that even though they think quantitative easing could be slowed down and completely removed by next year, that they will revisit that question and will continue to provide support to the economy as long as it is needed. This shows that they will follow through by continuously monitoring the state of the economy.

    Similarly if executive management and the board clearly sets and monitors performance or other expectations (without recalibrating it unless absolutely necessary) then no surprises management could be a very effective management mantra.
    • malvin bernal
    • Business Excellence Practitioner
    The "no surprises" philosophy should be looked at from a holistic perspective. More than managing your boss, it should put the debate on whether predictive methodologies are being put in play. Predictive analytics mitigate the existence of "chance" and the probability of not being in control of events and/or eventualities. Full appreciation of events and the data that supports it should be suffice to ensure that no surprises are made certain. Why do bosses hate surprises, because certainty is the main commodity.
    • Mark Rome
    • CFO, Cummings Engineering
    Mr. Heskett, let me applaud you on your excellent work. We issue culture assessment surveys on an ongoing basis to track levels of trust throughout the organization. We've integrated the assessment surveys with feedback loops to gain actionable intelligence, apply failure mode and effects analysis, and allow employees to tract the adjudication of their submissions anonymously. When leadership follows up, we see performance improvements. When leadership is slow to respond, performance trends downward. Thanks again!
    • Edward Hare
    • Retired Director, Strategy and Planning, Fortune 250 Manufacturer
    I think we'd do well to acknowledge that "surprises" are a part of life and come in lots of different categories. What's important is to try to understand if they were avoidable or could have been foreseen as well as how we react and address them in the future.
    But I "No Surprises Management" just another re-incarnation of the Zero Defects Quality concept that's been around for decades? To me, the parallels are obvious.
    • Paul Nicholas
    • Director, Soul-Chaplain Consultancy
    This is great - thank you!

    Our brains are attuned to seek surprises - threats and opportunities catch our attention that way - and some elements of surprise, such as surprise dependent learning, can be both powerful and beneficial. I often try to bring this aspect of surprise into my work - the one essential proviso being that the surprise is a positive one and kicks in a positive emotional response.
    • Carl
    • L&OD Consultant
    The "NSM philosophy" should be structured on the premise of management - not being reactive and based upon a culture of proactive engagement. To expect short/long-term success through the variable integration of surprise management: strategic direction, communication and trust - will suffer and manifest itself in the non-adherence and/or compliance to an organization's goals and objectives.

    Simply stated, "No Surprises Management" (NSM) should be incorporated as a standard of operation, not just a requisite response to its backlash. Therefore, by acknowledging employees' intellectual/personal contributions - management stands a better chance of increasing: the continued development of its human capital and profit margin.
    • Himanshu Pant
    • Associate Director-HR, MGH Group, India
    Mr. Heskett, Great concept which can definitely help in improving the efficiency at the workplace but at the same point of time I feel Surprises are good at times especially when its about "exceeding the expectations". Be it employee or Employer, in a perfect situation it would always be great if both (Employee & Employer) show reciprocity in exceeding each other's expectations where employee delivers result, create value to the organisation and employer exceeds his/her expectation by giving higher growth, great Financials & more exposure and learning. whenever such situation happens, there would always be an element of "Surprise".