Monday, March 24, 2008

Basics in Management - A Case Study (Slovak Style)

A couple months ago, I was called to assist in a case, in which a privately run school faced serious financial challenges: There were no more funds, due to a drastic subsidy cut (minus 30%), and thus no money in the bankaccount to pay for the salaries of the teaching staff. As it was quite a tragic situation, and having a soft spot for culture, I agreed to help out.

In short, when first collecting the financial data, I was getting slightly uneasy about the fact, that the financial controller was obviously not in control at all; all data came were estimates, some of it was redundant, and it took him way too long to deliver. In order to tackle the emergency situation, I disregarded this for now - I would address the issue later. After a couple of days of calculating, trying out varous models, a solution was formulated in order to save the school for closing its doors forever. Surviving was the keyword. We were aware of the fact, that increase of school fees would make parents have their offspring leave school (which would be a financial drain at this stage), and thus the concept would not touch that aspect. The model provided even opportunities to expand the school programmes, generating bigger revenues, which would make the organisation viable, despite the meagre state-funding. We agreed to a quick session with the rest of the staff to inform them of the upcoming strategy, then a few days later, the parents would be informed by a presentation-session. In addition, the subsidy-cut was obviously known beforehand - why only acting on it so late?.

The director of the school, abviously not completely aware of his function (i.e. managing), invited - without informing me - 2 other speakers, and it turned out that the 2 prominent guests were moving the whole discussion into the wrong direction - almost leaving my powerpoint presentation useless. Concluding the discussion evening, the director decided for some measures which were not in line with the agreed solutions, even altering a couple of schoolfee-issues.

The result was, that the survival strategy was completely distorted, causing indeed pupils to leave school, and individually adjust the schoolfees for every parent, who came to the director's office to complain (as there would be some, I expected so)

I have urgently pressed the director for a session of a serious re-evaluation of the measures, in order to remain on top of the situation, pointing out the weak spots in his organisation, which needed immediately to be addressed, else the precarious situation would only dramatically worsen, offering assistance at even a symbolic fee (as their finances were in such an embarrassing state) which was followed by.... a long and deep silence. Trying once more to bring him back to reality, he was completely surprised; even not being aware that he was supposed to respond to my previous offer. Here, I gave up! I have experienced many different occasions, which made me frown a bit; this, however, beat all of it.

What went wrong:
  • management did not anticipate to changes (legislation takes usually several months before effective, so it should not have been a surprise at all)
  • financial reporting, as the most important and a basic managment-tool, was merely non-existent (controller could not produce any actual data)
  • management was not in command during decision making (influenced too much by irrelevant outside noise)
  • implementation of solution was not according to agreed strategies (...)

Here we have a clear example, that although this director is perhaps a kind hearted person, has not the faintest clue what it is to be a manager. Never mind, not everyone is a Bill Gates or a Henry Ford, creating a gold-mine from his organisation, but even when offered a willing hand, not even then, do they have the ability to realise what to do. The visible result is, that teaching staff doesn't get their salaries paid on time. It borders at having the school ruined - almost on purpose. It is a very tragic case, but - although having seen here a few very capable and resourceful directors as well, who deserve credit - it is, however, not an isolated case; generally speaking, it is rather symptomatic. These are clearly the persevering old structures, old thinking (not used to market oriented approaches) that persist in the people's passive attitude. This needless passivity, which is exactly destroying potential in culture, or at least causing serious damage. Never mind the fee, which I will lose, I care more for saving the school than my invoice. But personally, for the sake of the young pupils, who are on the threshold, their first little steps of becoming a musician, this director deserves a serious old-style ear-bashing!

best regards
MS


6 comments:

Anonymous said...

Sounds awful! Is there no school-board to intervene??? Wish you all the luck

R

Anonymous said...

I think you, being a foreigner in Slovakia and not knowing the local practices, are also partially to be blamed for the communications mishap.

It's never enough in Slovakia to rely on informal oral agreements to accomplish anything.

If you arranged with the school to get it out of the crisis, you should have retained that agreement on paper in a formal contract.

If you don't do that, the result is as described by you. You're taken simply as a "passer-by", your help is accepted and appreciated, but you will not remain the only one who they will turn to for help.

Their inviting 2 more prominent speakers to the meeting, without letting you know about it, is perfectly logical, therefore, and in line with local practices. For them, you were simply a person willing to help, nothing more. If you had a formal contract on paper with the school, that would have been different.

Also, you should realize that, unlike in Western Europe, school directors in Slovakia are primarily looked upon as TEACHERS, NOT MANAGERS. Many Westerners don't undertand this. Slovaks, in general (both teachers and parents), look with distaste at the idea of schools being managed as if they were profit-oriented enterprises. The school director, or more aptly: head teacher, is looked upon as someone to inpire others through his or her teaching, methodology, etc. He or she is NOT supposed to be interested primarily in money and managing money. Slovak teachers, as a rule, imagine that the necessary money to run the school and pay the teachers will "automagically" appear for them whenever needed. ;-)

It may be an irrational attitude and you may disagree with it, but that's the Slovak national mentality. These aspects of the "case study" may have escaped you, a foreigner coming from Western Europe.

Michael Srba said...

Dear Anonymous,

Indeed, to a certain extend, the mentioned experience seems a typical example of Slovak mentality. Unlike you suggest in your comment, I am not that far 'foreign' and have had nevertheless a much closer awareness of Slovak and Czech matters (including their development and mentality), starting even from the pre-Velvet Revolution period. And as far as the communication is concerned, I think, we have had a very clear communication, without any ambiguity.

As I have also mentioned in my article. there are also examples of well managed institutions, so it would be an over-simplification, to state that in Slovakia this is the way schools should run, because it's the local habit (this is just my addition, and I am not suggesting that it was your intention to say such) ;-)

Nevertheless, I look at it from my point of view as a management consultant; if an organisation is looking for help, but is not doing anything with it, then you see a management issue. Of course, in the end, it is the sole decision of its management how to proceed. But management, has a responsibility, whether Slovak or in any other country - and that's how market economy requires it, because it has financial consequences. This is perhaps still a learning process, but I am not convinced that being a Slovak is a good alibi for mismanagement. In the end, it's the tax-payers money AND the money of individual families being wrongly used. In the eyes of ethical business conduct, it is, in my eyes, very questionable whether that is admissible.

best regards
Michael

Anonymous said...

I do agree with Michael. Problem like that in the Slovakia must not be excused by our old methods. It is true like steeling money if you are not being responsible.

Rudo

Anonymous said...

Is it really a problem or an attitude you can find only in Slovakia or other countries in CEE? I think, it's not true and if I go through the past I've gone through a very similar experience. In Austria, not in CEE.

It means: you can find these old methods anywhere, unfortunately :-(

Anonymous said...

I am amazed and also abit upset to read how Anonymous (comment of March 30) is trying to justify the situation.

I myself am a musician, who has to deal with poor quality of culture managers in school, orchestra, or else too. I spent some time abroad as well, and can exactly understand what Michael is trying to point out.

Exact this is problem, that our so called managers are not feeling responsible for their post. And in most cases they are not even good teachers too - a teacher (pedagogue) understands the needing for imrpovement -> and would try his best to learn to perform well/better - even if it is not his perhaps exact profession.

There are enough good and motivated musicians, who would contribute better quality; exactly the attitude of Anonymous is teh reason why the good ones do not get a chance and nothing is happening. Michael, I wish you luck, because people like you are needed here very badly! Hope to meet you one day for a project.

P.