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Jul 25, 2018 | IN Leadership | BY Reza Koranki
Managing Agreements, Not People

Bringing together a group of high-performing individuals to create an environment that breeds effective, efficient performance (in that order) is not simplistic. At Arch Technologies, we have found that leading a group like this requires careful consideration and planning.

For us, managing by agreement as opposed to emotional or personal considerations has been a game-changer. It has allowed us to save time, money, rework, and dramatically increase our performance as an organization.

Success in business requires learning as fast as the world is changing. – (Click to Tweet)

What is an Agreement?

Agreements are not requests, demands, or notices. The antithesis of Agreement is Expectation.

Expectations breed disappointment. They are unspoken and differ within relationships. Operating based on Expectation leads to risk.

Operating based on Agreement drives accountability and performance. Agreements create power within a relationship. Both parties have ownership in the process, giving power to each.  

Agreements are co-created using language and require the mutual support and understanding of everyone involved to be enacted.

When an agreement is broken, there is no discussion of the “why.”

Managing by agreement-Arch

Telling a story or providing a reason for breaking an agreement only alleviates guilt and pressure from the person who broke the agreement. It does not restore performance to the person or group with whom the agreement was made.

When agreements are honored, there is performance. When agreements are not honored, there is no performance.

What is Managing by Agreement?

Most companies manage people by tending to their thoughts, feelings, emotions, and needs without considering the performance needs of the organization. Managing in this way is both temporary and exhausting. It requires continually evaluating the needs of the person and adjusting to accommodate.

Managing by agreement begins with establishing and defining domains. There is a personal domain, and there is a business domain. What is acceptable in one domain may not be acceptable in the other. Creating clarity around domains provides a framework for discussions.

For example, an employee who asks for time-off is operating in the business domain. If the request is denied, the discussion may leak over into the personal domain as feelings and thoughts enter the conversation. The employee may begin to talk about an important family event that is taking place and how he or she feels about missing the event.

However, from a business perspective, the time-off request can only be reviewed in terms of performance. As a part of the team, the employee has agreed to deliver a specific level of performance. This agreement must be satisfied. If it is not, it is up to the person breaking the agreement to make the other participants in the agreement whole.

You cannot negotiate with people who say what’s mine is mine and what’s yours is negotiable. – (Click to Tweet)

Managing Agreements Outside of the Organization

At Arch Technologies, we do not only manage agreements internally. We also operate by agreements with our clients and vendors.

For example, customer relationships with a sales team member often bounce back and forth between personal and business domains. This causes a breakdown because there is a sense that the relationship is based on bartering. The customer may ask for a deep discount, and to accommodate the request, the salesperson offers a product that does not truly meet the performance needs of the client.

In this situation, both the salesperson and the client suffer because neither understands the domain in which they are operating. Not knowing which domain the relationship is operating in causes both the business and the personal relationships to suffer.

Managing business relationships-446690-edited

At Arch Technologies, we freely remind our customers and vendors of domains. When a business conversation veers into the personal domain we are not shy about recognizing the change and asking the customer, vendor, or co-worker to finish the business discussion (which often means creating an agreement) before we get into the personal.

Managing by agreement and acknowledging the domains in which we operate is freeing. It allows us to be consistent and keeps us from being hypocritical. There is never a situation where an employee feels that someone else on the team has an unfair advantage because of a personal relationship. We all operate by the agreements we co-create.

Now that we have a firm handle on agreements and domains, everyone on our team recognizes and creates agreements at speed. Instead of long discussions about who will do what when, we quickly describe a situation, state our involvement and performance, restate the agreement and move on. We know that agreements are weighty.  We know that an agreement will be honored and that if it is not, we will be made whole.

Managing by agreement requires an initial investment of time. However, once the process is ingrained in the culture of the organization, the increase in performance far exceeds the initial investment.

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