Friday, 31 July 2009

Mindful simplification

Today on Radio New Zealand National Sir Howard Davies, Director of the London School of Economics was asked “How do we recover from the recession?” Especially interesting to me was that he pointed to the blindness (astounding in hindsight) of banks and government advisors that got us into it. They were blind because they didn’t see the signals of impending “brutal audit”. Their KPIs effectively blinkered their vision.

I see this happening to one degree or another in pretty much every organisation I’ve owned, worked for or worked with.

I’m very critical of many KPI/performance measurement systems because they frequently erode collaboration, promote and perpetuate bad management behaviour, and blinker perception. On the other hand I’m also an enthusiast for intimacy with valid, relevant data.

I’m am enthusiast for simplification for focused action. On the other hand I’m also very critical of mindless compliance and groupthink that’s frequently the consequence of simplistic analysis, rules, procedures, and expectations.

Not surprisingly perhaps, some find it hard to figure “whose side I’m on”.

I’m an Edwards-Deming fan (kind of like being a member of a dead poets’ society). Deming’s lifelong passion was collaboration to achieve quality. Not in a fuzzy, feel-good sense but in a logical, objective sense: informed by valid, relevant data. A statistician, he understood how quality is determined by systems of thought, practice and organisation. Not individuals. He was very successful in Japan. His countrymen in USA have been very slow learners.

KPI systems are inevitably simplistic and biased: a selective abstract of reality based on a particular set of assumptions. So they inevitably distort or leave out potentially crucial aspects of complex reality.

The problem is how to collectively commit to a set of goals and performance measures yet remain mindful that that very commitment will blinker us to potentially crucial information.

This may not matter much in a predictable environment. But in an uncertain, fast-changing environment its a big issue. That’s because fast adaptation and innovation are triggered and driven by information from outside our normal frame of reference – our established KPIs.

Nimble organisations maintain clear purpose and operate simple strategies to achieve that, continually reviewing their KPIs for validity and relevance to that purpose. Statistically significant exceptions and failures are seized as opportunities for learning. Mindful, collaborative experimentation is a valued source of innovation.

Monday, 27 July 2009

The Emperor Has No Clothes!

This last week, while I experimented at applying my reading of Weick and Sutcliffe’s Managing the Unexpected to my own current organisational experiences, Steve Denning surprised and impressed me with his piece: Radical transparency vs The age of bullsh*t . He damns Management, as epitomised by the career behaviours of recently late Robert McNamara, with causing the current recession.

Coming on top of the similarly critical series of articles in the June HBR (mentioned in my blog last week) it was like a triple whammy.

What sprang to mind for me was Weick and Sutcliffe’s quote from Charles O’Reilly’s 1989 California Management Review article “Corporations, Culture , and Commitment” :

In the chaos of the battlefield there is a tendency of all ranks to combine and recast the story of their achievements into a shape which will satisfy the susceptibilities of national and regimental vain-glory . . . . . On the actual day of battle naked truths may be picked up for the asking. But by the following morning they have already begun to get into their uniforms.

Denning’s piece seems to me like a naked truth, spoken in the wake of battle.

Half expecting some to be clothing that truth already, I hasten to point out that this isn’t a cloth-cap Marxist rant against Management. I’m not arguing against management (small m) and I don’t think any of the writers mentioned here are. The argument is against a set of pervasive assumptions about how organisations should be managed: against the “ism” managerialism.

For instance, though I may rant and rail against stupidly simplistic (mindless) obsession with goals and KPIs, I am a passionate advocate for mindful, statistically sound use of valid, reliable objective and subjective data in controlling operations. I’m firmly with Edwards-Deming on that.

The argument is that we must seize this opportunity to learn from what Weick and Sutcliffe would call the “brutal audit “ of the last year. We must seize this opportunity to learn to be sensitive to signals of impending failure that contradict our convenient, simplistic assumptions about cause–and-effect and relevance. We must learn to incorporate that mindfulness into our organisational infrastructure.

I reckon that perhaps the best place to pick up and act on those naked truths is in entrepreneur owned and led, small to medium sized enterprises (SMEs). There the boss is more able, more likely to engage directly with high performing teams in a marriage of strategic simplicity and operational complexity through radically transparent interrelationships.

If you want a how-to list on recognising and picking up those naked truths then take the above link to Steve Denning’s article. Don’t expect bullet points. He’s into stories.

Wednesday, 15 July 2009

Keep it complex stupid!

I just returned from a brief break in a quiet corner (Naqalia Lodge) of Waya Lailai island in the Yasawa islands, Fiji. Expecting to do a little reading I took Weick and Sutcliffe’s Managing the Unexpected 2nd edition (2007) with me.

Serendipitously the June HBR caught my eye in the airport bookstore (along with The New Scientist and Scientific American). HBR’s June focus was Rebuilding Trust. I was interested that interpersonal communication was the key common element.

O’Toole and Bennis argue that “What’s Needed Next [is] A Culture of Candour”, arguing that “we won’t be able to rebuild trust in institutions until leaders learn how to communicate honestly – and create organizations where that’s the norm”.

Then I got into my hammock with Weick and Sutcliffe.


After I adjusted of their denser writing style, I appreciated the depth and complexity compared to the popular HBR style. When I finished I enjoyed the new cohering sense it gave to the HBR articles about building trust, not trusting too much, achieving innovation, being a good boss, and the deep failure of business schools.

Interestingly, between the 2001 1st edition and the 2007 2nd edition the subtitle changed from “Assuring High Performance in an Age of Complexity” to “Resilient Performance in an Age of Uncertainty” reflecting the continuing Richter 5+ seismic shifts in organisational environment. What’s impressive is that their thesis seems more powerful in the light of recent events.

Of course Weick and Sutcliffe write about communication too but unlike the HBR articles they have room to go beyond description and exhortation to update and further demonstrate their 2001 thesis about mindful action.

They provide excellent argument against fashionable simplification, focus and strategising being the ways to achieve success in this day and age. This is particularly true for businesses operating complex technical systems in dynamic, ambiguous contexts. They argue for mindful infrastructure. They contrast this with mindless infrastructure, which typically attends to success, simplicities, strategy, planning and status. They argue very convincingly that attention to success confirms the status quo; simplification rules out crucial information and diverse perspectives; attention to strategy and planning ignores operational reality and attention to status erodes and ignores expertise.

They argue that the keys to success today are attention to failure, context, operations, resilience, and expertise. They recommend managers lead change by opportunistically demonstrating changed communication behaviour: candidly reporting and discussing failure; including and rewarding diverse perspectives; being intimate with actual operational experience rather than ideas and generalisations; pushing analysis and decision-making downwards; deferring to expertise (which exists between people) not authority, so that others can begin to see what mindful work looks and feels like. Out of that experience emerges changed values, attitudes, and beliefs – changed culture.

Very convincing. Though I guess that one reason I find it so is because it confirms my own analyses and makes useful sense of my own experience in and with organisations over that last decade or so.

I can see this providing me with a rich resource for thought, analysis, action and blogging . . . . . . .

Sunday, 5 July 2009

You can’t demand engagement, only court it.

A tweet and email from my colleague Stephen Lynch about a 26 June article in Forbes on employee engagement triggered this post. The story’s about Douglas Conant turning Campbell Soup Co around by engaging the employees!

Successfully turning the organisation around is news in itself, but it’s the way he did it that grabs me. He did it by seeking engagement, not alignment! Maybe this means that “engagement” is superseding “alignment”. Alleluia!

To me it’s no surprise that Conant’s engagement-focused leadership achieved amazing results. What particularly interests me is that he apparently had to get rid of 300 out of 350 Campbell’s managers to do it. I wonder why?

My guess is that that was the quickest way to interrupt the established patterns of communication: to create room for changed organisational communication. That would generate enough organisational uncertainty and anxiety for the long-believed unspeakable to be spoken and heard; for people to discover that their opinions matter and for them to experience, perhaps for the 1st time ever, the spirit of doing good things together– to experience release from the psychic prison of defensive manipulation.

But what’s the difference between Conant’s approach and conventional restructuring, which almost always fails to improve productivity? Was he just a lucky bastard? Or is there magic in this engagement thing?

I reckon there’s much more to it than luck. I reckon that Conant somehow had the sense to break the Managerial spell to free employees to begin to figure out together how to do Campbell Soup Co better. I reckon he had faith that Campbell’s employees could do great things together if only they could get a chance to begin to really experience collaboration.

That contrasts with most restructures which are effectively exercises in defensive manipulation based on the assumption that, if allowed, employees will hijack any freedom for their selfish, ignorant, if not downright destructive purposes. Managers know this from hard-won experience of trying to get inevitably reluctant employees to do what managers want (know best). Result: “plus la change” (more of the same).

Actual organisational change begins in crisis so if there is no crisis, create one. Then it’s not so much what you do with the crisis, but the way that you do it.

Conant restructured, but the way that he did it was inspired. Effectively his purpose in restructuring and in the attendant uncertainty was to enable new communication, new interrelationships, and attendant insight. In short: engagement. You can’t demand engagement - only court it.

Marcus Buckingham gave “engagement” wings with the Gallup research that defined it and identified 12 reliable indicators and drivers of it. That led Buckingham on to his work in strengths-focused education and management: the complete opposite of conventional weakness-focused education and management.

To gauge whether your organisation is engaging or not ask your employees to rate these 12 statements (1, low – 5, high). If the mean score is better than 4 you’re getting close.