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HomeNewsArchivesSource Manager's Journal: Relative Deprivation: Big Term, Big Problem

Source Manager's Journal: Relative Deprivation: Big Term, Big Problem

June 19. 2006– In his classic book "Management," Peter Drucker, the father of American management, wrote "There is no more powerful disincentive, no more effective bar to motivation, than dissatisfaction over one's pay compared to that of one's peers." As strong as his assertion was, Drucker probably understated the case. By focusing on pay, he left out all of the other forms of relative deprivation and their negative impacts on the workplace and on individual performance. Relative deprivation – and its toxic outcomes – covers a range of small-to-large injustices, both real and perceived. Often when someone says "That's not fair," they are talking about some form of relative deprivation.
Years ago, I worked as a longshoreman unloading fruit on the New York waterfront. There was a young man who had gotten his job through connections and, therefore, had the easiest job on the dock. But even that wasn't enough for him. He may have been the laziest human being I have ever seen, but he was never disciplined or reprimanded. After a while, the rest of us, all good workers, drew the logical conclusion: this isn't fair, and this guy is making us all feel like suckers. From then on, we did as little work as possible. Relative deprivation.
Once people start thinking about it, they realize that relative deprivation and its consequences are widespread, unequal pay being just one manifestation. Relative deprivation is almost purely a management problem. Sometimes it is just a result of an oversight or impulsiveness. In other instances, it has become a part of the organizational culture, the way we do things here, and people believe – correctly or not – that nobody gets anything unless the fix is in. Typical comment: "Everything here is about politics."
I recently worked with an organization with a brilliant CEO. He could see connections and opportunities that nobody else had thought of. He was also impulsive, didn't think organizationally, and wanted what he wanted. He would spot a talented person somewhere and think, "I have to have this person." The salary requirement would be out of line with comparable positions in the organization, but he recruited the person anyway, because they were going to be great. When word got out that this new person was making more money than comparable staff with more experience, the trouble started. So he figured out something to placate them, usually a bonus or some perk. Whoa!! Now a whole department was going to be paid more than a similar department. And on and on. As often happens, the cover-up, a.k.a. "adjustments", becameomes more important than the original crime. The result was that the resentment metastasized. Salary clarity was replaced by ambiguity and a growing sense that there were no guidelines. Over time, trust eroded in critical ways, ways that negatively affected individual and group performance. And, at some point, the majority of personnel decisions were being made to compensate for previous mistakes.
Based on experience, it is clear that Drucker was right on target with respect to the damage that a sense of relative deprivation causes in organizations. Once people feel that they have been treated unfairly or are made to feel that they are losers, only bad things can happen. These bad things range from passivity and indifference to open sabotage of the organization's goals. In contrast to other management tools where the goal is to make something happen, the tools in this area are purely preventive. Here are four of the most important ones:
Context: People decisions, especially related to compensation and related benefits, should always be considered within an overall context. How will this affect others? In some instances, exceptions are worth making, but the criteria for making them should always be explicit so that charges of favoritism don't stick.
Self-awareness: It is important to be aware of our own biases, weaknesses and proclivities and how they might contribute to a sense of relative deprivation. As a manager, and until I became aware of it, I had a tendency to isolate and ignore poor performers rather than addressing the problem. Part of this pattern was conflict avoidance but another part was just a quirk. If I ignore them, maybe they will go away or get better. Not too smart. It also had the effect of creating a kind of reverse favoritism. If you were good, you got attention. If not, you didn't get any help or even understand what you were doing wrong. There are different negative traits that we all possess. It's useful to do a self-assessment and learn how to avoid the ones that hurt us in this key area.
Avoid impulsiveness in words and actions: Leaders and managers define their organizational cultures and the norms and values that drive them. Snap judgments and impulsive statements, especially when they can be construed as creating a sense of unfairness, can cause serious problems and have a cumulative negative impact. Speaking as a leader or manager isn't the same as having a conversation with a group of friends. Words, actions and even body language all matter.
Clarity and transparency: There is a simple rule of organizational life: clarity is good, and ambiguity is bad. Management by exception and the creation of different classes produces ambiguity. Ambiguity in turn leads to suspicion, mistrust and a tendency to put the worst interpretation on any event. In the most dire cases, managers lie about what they have done and, in the end, forfeit the trust of their staff. If you can't defend it, don't do it.
One of the interesting things about the idea of relative deprivation is that once you understand it you begin to see it all over the place. Beyond the workplace, it affects whole societies, sports teams, religious organizations and almost any other organized group where things of value are shared or allocated. As Peter Drucker said, it is a big deal. Avoid it.
Editor's note: Dr. Frank Schneiger is the president of Human Services Management Institute, Inc., a 25-year-old management consulting firm that focuses on organizational change. Much of his current work is in the area of problems of execution and implementing rapid changes as responses to operational problems.
Readers are invited to submit questions, topics or issues that they would like addressed in a column. Submit to source@viaccess.net.

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