Wherefore Art Thou Nokia?
Killed by Internal Politics
During my lunch break in Tanjong Pagar this week (which features way too many healthy options and not enough juicy burger joints) I swung past my favourite gadget shop as I am due a mobile phone upgrade – yippee. Whilst carefully listening (not really) to the sales pitch on whether to choose the new iPhone XS Max or the Google Pixel 3, an old flame caught my eye in a lonely sales section – the infamous Nokia 3360.
I couldn’t help but reminisce about how my phone relationships were so much less complicated back then. There was definitely less talking (blissful), it didn’t know my whereabouts (phew), my photos were not all stored on the cloud (better for everyone), it didn’t keep copies of my fingerprints (invasive), I wasn’t nagged by constant reminders and notifications (who wants that anyway?) and finally it absolutely wasn’t smarter than I was!
There have been a lot of publications on Nokia’s fall from the top of the smartphone pyramid, and it is often put down to three factors.
1) Nokia was technically inferior to Apple
2) The company was complacent
3) Leaders didn’t see the disruptive iPhone coming.
I have another theory. I think that Nokia’s downfall was partly caused by siloed internal politics fueled by fear and complacency, where staff were more concerned about their status and internal promotion than cooperating actively to stay ahead and innovative.
Internal Politics – the Silent Threat?
Having been involved with start-ups in the disruptive economy during the last couple of years, especially those experiencing hyper growth, I concluded that as soon as you expand your start-up you might experience some of the challenges Nokia faced. Many of these you can probably spot and solve quickly. One that might go unnoticed is that of internal politics.
The argument is, that as soon as a group of people start working together, there will be some form of internal politics. It’s natural, as everyone comes into the business with their own personal goals, egos, agendas and aspirations.
To get what they want, they’ll compromise, negotiate and manipulate events around them.
Problems with internal politics in a start-up affect both the morale of staff and their productivity. The business loses out on profitability and loses key members of the team that made them successful.
Harvard Business Review summarises well common ways internal politics begin to take root:
Misalignment of an employee’s personal motivations and those of the company;
Lack of a common vision among the key stakeholders (founders, investors, employees);
Debate about when to raise outside money or seek an exit;
Mismanagement of expectations regarding credit, compensation, or options for achievement;
Founders overvaluing personal loyalty to team members versus the results of each individual;
Indecisive strategic leadership; and
Lack of trust between leadership and the team.
How To Stop Internal Politics?
The challenge you’ll face is that in a fast growth start-up, there are numerous tasks you’ll have to manage. This allows politics to slip into your start-up unnoticed. At the same time, some of the behaviors exhibited in internal office politics are also desired behaviors ambitious companies ask for.
For instance, you will want staff to suggest improvements the company can make and for them to want to develop themselves. The truth is, that if either of these are improperly managed, internal politics can become problematic.
So how do you manage internal politics without upsetting your staff? Well there are some ideas you can implement right now.
Hire The Right People
The first key point is to ensure you’re hiring people who have the right ambition from the start. These people should have the same goals and ambitions as you and your brand. The difference is that the employee wants the company to succeed and their success is a by-product of the company’s success.
Build Pragmatic Policies
There are many situations that attract political motivation. These include: performance evaluation and compensation, career development and company structure. By putting policies and procedures in place, employees will find it tough to politicize them. Just be sure you follow those policies.
Compensate For Achievements Not Position
One of the main causes of politics within a business is for someone to gain a reward, usually for progressing in the company. Therefore, politically minded and ambitious people will want to remove rivals or damage their chances of getting that compensation.
If you reward employees based on achievements rather than position, those who are ambitious need to concentrate on their own behaviors rather than that of rivals.
Don’t Let Internal Politics Ruin Your Start-up
Internal politics aren’t just a nuisance. They can be devastating with losses of key personnel and resources that can be a serious threat to your profitability.
But by minimizing conflict within your organization, you can offer an environment that is full of innovation, opportunities for self-development and high employee well-being. The results will be you becoming an employer of choice that attracts the best talents.
As for me I am the none the wiser on which phone to upgrade to and still looking for a healthy burger restaurant for lunch. But I will console myself with my awesome Nokia 3360 snake high score of 1152 which came close to the maximum score of 2008 – ah, geek fact!
My next post will be about how big corporates can learn from start-ups that operate in the disruptive economy, as there are many lessons to be learned.
