Why Best Practices Can Be So Dangerous

September 10, 2009

I recently dusted off Jim Collins’ book Good to Great. For those who have forgotten, the book compiles a list of companies that have achieved ‘greatness’ over a period of 15 years and then analyzes them in order to “discover the essential and distinguishing factors at work”. The resulting best practices of these best companies has been a bestseller since 2001.

‘Best practices’ is itself a bestseller, a management technique/tool kit that has become a staple in disciplines such as leadership, education, quality, change management, government, project management and scores of others. Its popularity lies in its promise to take the processes, systems, and approaches that have worked for the successful and distil them into guidelines, rules or dare I say ‘universal truths’ for the benefit of successful wannabes. And given our unquenchable thirst for quick, easy answers to complex questions we gobble it up. Amazon lists over 2500 books alone on ‘best practices’.

Unfortunately like most man-made attempts at unearthing universal truths, the truths embedded in best practices struggle with universality. A few examples illustrate the problems and risks.

The U.S. was once a leader in producing world-class marathoners. The seventies and eighties produced a string of such notable runners as Steve Prefontaine, Frank Shorter, Alberto Salazar and Joan Benoit Samuelson the sum of whom led many to believe that the US would be a long-term distance-running powerhouse. This optimism gave birth to an industry of authors, coaches and publications trading on the diet and training best-practices of these and other champions. Long-distance running became a science and a generation of runners turned to the Runners Handbook for instruction. But instead of breeding even more great marathoners the US subsequently plummeted as an elite distance-running nation. Meanwhile countries from Africa came out of nowhere to dominate the sport. Though theories abound (training regimen, genetics, motivation etc etc) there is no consensus on exactly what went wrong. But then a few weeks ago an article profiled the recent success of American marathoner Kara Goucher. In attributing her meteoric rise the article made the observation that, “Ms Gaucher has taken all of the tactics generated by US running experts in the last 20 years – the charts, the mileage recommendations and high tech motion-sensing computer readouts – and stuffed them in a dumpster”. Ms. Gaucher has shunned the best-practices in favor of a more ‘free-wheeling’ training regimen based on how she ‘feels’. That’s right, she trains based on how she feels on that particular day. No systems, no interval regimens, no best practices, just running as hard as she can for as long as she can when she feels like it.

Also in the world of running, Usain Bolt’s obliteration of track and field’s speed records is prompting many experts to dissect his training and diet regimen in preparation for what will surely be tomorrow’s best practices. Among the tidbits that caught the attention of many was his admission that on the day he broke one of his recent world records, he: “woke around 11am, watched some TV and had some chicken nuggets”. This new breakfast of champions will undoubtedly draw many young volunteers, much to the chagrin of nutritionists, coaches and best-practice advocates everywhere.

In business, a recent article profiled the fate of EMI pursuant to its acquisition by private equity firm Terra Firma Capital. Upon acquiring the storied record company, the private equity firm applied the buyout industry best practice, “of cutting costs aggressively with an eye toward selling the streamlined business at a big profit”. This illustrates the one-size-fits-all, or in this case one hubris-fits-all, thinking of best practices. Unfortunately in this instance the result has been an unmitigated disaster as the ‘hard-assed’ private equity firm has been unable to extract the targeted efficiency levels from the business. One reason is that EMI’s products, rather than being widgets, are the ‘talent’ itself who are accustomed to being coddled rather than treated as financial line items. A number of these performers (including such acts as the Rolling Stones and Radiohead) showed their displeasure with the buyout firm by moving to other labels, leaving the efficiency experts with no products to make efficient. A similar article appeared the very next day questioning the fate of MGM which is also getting the private equity best practices treatment.

Best practices are often presented as contextually neutral. But as the recent diminished states of several Good to Great organizations attests context matters. Fannie Mae was described by Mr. Collins as a symbol of excellence on par with General Electric and Coca Cola. It is now a symbol of the financial crisis, and was nationalized by the US government. Wells Fargo has similarly been shaken to its core and as for Circuit City, the electronics retailer filed for bankruptcy earlier this year.

Best practices also promise universal applicability. But just because company ‘A’ had success with a certain approach does not mean that company ‘B’ can plug-and-play the same approach to similar effect. One need only ask the private equity hotshots at EMI or the army of GE executives who have deployed the GE playbook to mixed effect in organizations into which they were parachuted to rescue.

Finally, while focusing adherents on practices that have proven effective for others best practices can narrow the range of creative possibilities in solving problems. This sets up the inevitable fascination with the success of outliers who challenge, stretch or ignore altogether the practices of those who traveled before them. They are the innovators.

Former politician John Manley recently told the Globe and Mail that “One thing I learned in my years in government – and I think that has really been borne out in the last 18 months – is that there are no simple, general statements that apply to every situation”.
While best practices can be helpful they must never be viewed as anything more than data which must then be kneaded along with experience, discernment, discretion, subject matter expertise, intellect, creativity and wisdom before being baked and consumed.

Robert Hebert is Managing Partner of Toronto-based executive search firm StoneWood Group (www.stonewoodgroup.com). He can be reached @ rhebert@stonewoodgroup.com or at 416.365.9494x777