It's red and blue in business

MANAGING staff during a downturn is a critical issue for small business but, according to an academic at Southern Cross University, it is usually done poorly.

Dr Douglas Long, of the Graduate College of Management, Tweed Heads, believes that in turbulent times organisations desperately need people who are optimists, collaborative and committed. He talks of an organisational system where businesses are either 'blue' or 'red'.

The red organisation promotes a negative culture and is an expensive place to be as costs increase while productivity declines, he said.

The blue organisation promotes a positive culture and is a desirable place to be as costs fall and productivity rises.

“Today, more than ever, businesses need to be blue organisations,” Dr Long said.

A blue organisation was one where management encouraged and empowered, while showing absolute authenticity and integrity in dealing with staff.

A red management discouraged and controlled while interacting with people in a way perceived as artificial and superficial.

Dr Long said the challenge for business was making the shift from red to blue.

He said red organisations were all about survival, maintaining the status quo, while blue ones were about adaptation and change.

So how does a business move from red to blue? According to Dr Long, it is all about leadership.

“The critical issue is one of engagement with others so that the leader shows unconditional respect for individuals, regardless of the appropriateness or otherwise of their behaviour.

"From this point of respect, performance and learning issues can be positively addressed.

“During a downturn managers look at staff cuts, chopping back on quality and don't keep people informed as they should.

"If people share information and work collaboratively this breaks down the traditional hierarchical system based on fear. This allows businesses to move forward.”

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