Breaking the Ice: Overcoming the Frozen Middle and Unintentional Sabotage in Asset-Centric Industries

by David Walter, Executive Director – Innovation & Strategy, Secora

Identifying Common Challenges

Imagine standing at the brink of a major breakthrough in operational efficiency within your organisation. Now picture an invisible barrier that subtly hampers these efforts—familiar scenes in industries like Defence, Mining, Oil and Gas, and Power Generation, where the stakes and costs are enormously high. As someone managing or leading asset maintenance or operations, you might find these scenarios strikingly familiar. This article delves into two critical organisational challenges—the Frozen Middle and Unintentional Sabotage—shedding light on their covert impact on asset management.

This article was inspired by a discussion with a group of asset managers at a conference. These managers, relatively young compared to myself, came from a variety of sectors. They were fascinated with the events that preceded and followed the Rizzo Review of Royal Australian Navy Engineering in 2011. One question stumped me: What was the underlying limitation of Naval Engineering that resulted in the alignment of events that became the catalyst for degradation of Ship Repair and Management Practices as per Rizzo’s investigation and report? If we do not understand the ultimate catalyst and issues, are we destined to repeat them, not just in Naval Engineering but in other asset-centric industries?

The Frozen Middle

The concept of the Frozen Middle refers to middle management's often unintentional resistance to change initiated by senior leadership. Academically recognised as a barrier where strategic directives lose momentum, this layer can be crucial yet conservative, holding on to the status quo due to risk aversion, comfort in familiarity, overwhelm of change, or misaligned incentives. Middle management’s pivotal role in implementing change becomes a double-edged sword, capable of both spearheading and stifling innovation.

For example, in the early 2000s, General Motors faced significant challenges due to its middle management's resistance to change. Innovations and strategies proposed by senior leadership often got stuck in the middle management layer, who were hesitant to adopt new technologies or streamline operations due to fears of job security and the disruption of established processes. This resistance was a contributing factor to GM’s eventual bankruptcy in 2009 as it delayed necessary innovations in car design and manufacturing efficiency.

Deciphering CIA-Style Sabotage in Organisations

Originally outlined in the “Simple Sabotage Field Manual” by the CIA during World War II, the tactics described for disrupting the enemy's operations eerily mirror practices found in everyday business processes. This manual, intended for the information and guidance of individuals engaged in sabotage against enemy operations, serves as a guide for inciting and implementing disruptive actions within enemy territories, aiming to weaken the enemy by causing confusion, inefficiency, and resource depletion. The concerning part is how much it resembles ‘business as usual’ when trying to operate and maintain physical assets with a complex organisation.

Extract - Simple Sabotage Field Manual, 1944

The Compound Effect of the Frozen Middle and Unintentional Sabotage

When the resistance of the Frozen Middle meets the inefficiencies of Unintentional Sabotage, the result can be particularly insidious. These elements combine to create a formidable obstacle to progress that is difficult to detect and even harder to dismantle. The impact? Slowed innovation, missed opportunities, and an organisational culture that inadvertently promotes inefficiency and prevents productivity.

A major gas company in Australia launched an initiative to implement advanced predictive maintenance technologies across its assets to prevent unscheduled downtimes. However, individual site managers, sceptical of the innovation’s benefits and wary of its implications on their traditional workflow, did not prioritise its implementation. Combined with the technicians' habitual routines of reactive and scheduled maintenance, this led to continued inefficiencies, overworked teams, high maintenance costs and equipment failures that could have been prevented. This illustrates the destructive synergy between the Frozen Middle and Unintentional Sabotage.

Navigating Beyond the Ice and Saboteurs

At Secora we address the dual challenges of the Frozen Middle and Unintentional Sabotage through a concerted, multi-faceted approach. It's essential to engage not just at the strategic or top levels of an organisation but also at the operational or ground level, directly impacting daily practices and attitudes. Change must be implemented in a way that includes middle management as part of the solution, providing them with the tools and incentives to align with broader organisational goals.

Organisations need to be encouraged to foster a culture that values the alignment between the executive and technical with transparency, honest communication, and facilitate continuous learning and adaptation. This includes training programs that not only address new technologies but also focus on adaptive leadership and strategic management to prepare all levels of an organisation.

Ultimately, overcoming these barriers may necessitate external expertise to provide fresh perspectives and catalyse change. Secora’s expertise is grounded in offering strategies tailored to the unique needs of asset-intensive industries, and transforming potential organisational liabilities into streamlined, efficient assets ready to meet future challenges.

By adopting such comprehensive strategies, organisations can ensure that they not only overcome the inertia of the Frozen Middle but also turn potential saboteurs into innovators, driving the organisation forward in an increasingly competitive landscape.