Changing the mentality of “I know best”

The destructive mindset that is poisoning UAE and ME companies

April 5, 2017 | By Risktal Thought Leadership

Many companies operating in the UAE and Middle East have been the lucky recipients of the fortunate circumstances that the construction and financial boom brought to the region between 2002 and 2008.

As the UAE allowed for foreign ownership of property in Dubai, with limited regulations at the time, there has been an influx of foreign investments from all around the globe which instigated the economy boom at the time. Led by the real estate and construction sectors the whole supply chain that complemented them experienced major inflation as the race to secure resources both materials and personnel became overly competitive allowing less than competent talents to enter the market and rise to the leadership ranks for many of the organizations across the region.

The detrimental effects of the low quality of leadership started to unfold since the crisis hit the region in 2008/2009 until these days, which created a level of executives who are more directed at sustaining their positions and maximizing their personal benefits at the expense of the success of their organizations. The domino effect of that led to the hiring of substandard employees who would not form a threat to the leadership team, mostly hiring based on personal relationship or association irrespective of merit, or engaging “morally flexible” consultancies that would rubber stamp leadership’s decisions.

Based on a success driven by circumstances rather than personal capabilities and expertise, business leaders’ mentality in this region has become one of entitlement, attributing that incidental success as an indicator of their success as leaders, and that mentality created a more dangerous one of “I know best”.

The detrimental effect of the “I know best” mentality

The “I know best” mentality is quite detrimental to any organization as it is generally baseless and limited to what that executive has experienced in one or a couple of organizations in which he or she had worked. Even when faced with any assurance activities be it quality management, internal audit, external audit or compliance we notice one or a combination of the following behaviors:

  • Aggressively resist assurance activities and discredit them, and that could be administratively and/or operationally. Administratively, by not providing adequate budgets to effectively resource these activities and operationally by not facilitating the effective execution of the respective activity.
  • Attempt to influence the objectivity and integrity of these “supposed to be” independent functions, and sway them to align with their views. E.g. If you take a project or business that went horribly wrong and trace it back to the feasibility study that have been prepared by an “independent” professional, rarely you will find that that analysis predicted this train wreck, on the contrary it would have shown a healthy ROI, cash flow and riches to all investors, facilitating financing and investment.
  • Consider that they have ticked the box by allowing such activities to take place yet disregard the results coming out of them.

Why is it detrimental to you may ask?

This mentality is detrimental to organizations due to multitude of reasons of which we would like to shed the light on:

  • Not allowing for better practices, sometime in the most basic of processes, to be implemented.
  • Suppressing innovation, evolution and growth.
  • Demotivating personnel and creating a culture of complacency.
  • Negative work environment.
  • Increasingly incompetent leadership focused on personal profiteering at the expense of organizational progression.

What can be done to overcome this mentality?

Board of Directors and business owners are first and foremost accountable and responsible to vet their executives, assess their quality, competence and contribution to the organization. In addition to effectively and proactively manage their performance.

The most important factor that would give these stakeholders an insight into what their executives are doing with their organization is to engage directly with independent advisers who would provide them with the assurance needed and advice to improve their business.

The key success factors for such activities to make a difference and drive change are:

  • Empowering the assurance activities.
  • Effectively manage the results of these activities.
  • Adequately resource these activities.

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