Just a quick note on my recent absence from this blog.... My dad died this month, and I've been traveling to be with family. I will restart the blog within the week.
Wishing everyone a peace-filled year that is generous and welcoming.
Tuesday, December 29, 2009
Monday, November 30, 2009
The Decaying Orbit
My last post suggested that careers follow a natural curve of maturity, decline, and renewal rather than follow a linearly progressive curve, which is the more common conceit. The linear growth progression is an artificial construct we superimpose on the natural rhythms of human development.
Closely tied to this is an idea that as a person navigates his or her progression up the career ladder, management skills become increasingly important. This is of a piece with the idea of linear progression: the higher up you go, the more time a person spends controlling and directing others, and increasingly less time is spent making an individual contribution. I disagree on both counts.
Consider an individual's growth as a human being, starting from the first days in the cradle. We all start life completely focused on the self. An infant only focuses on objects outside himself so that he can meet his own basic needs: influencing a care giver to feed him, keep him comfortable, touch and hold him. With time, he differentiates between the people most important to him (the people who meet his needs daily) and everyone else. He strives to control the environment around him, primarily by influencing those people who can help him control it. By school-age, the individual is learning self-control, and how to influence people outside his family so that he can control his environment. Eventually, the individual expands his world to care about those he does not know personally. Over time, the individual's world expands outward by degrees, and in this process affects his relationship and responsibility to the world in concentric circles around him. Graphically, it looks something like this:
But imagine if you will that each of these circles is actually a 3-dimensional sphere comprising a world relative to the individual, who is the point at the center of it all. Of course, each sphere or world can exist without that individual; this is simply the view from the individual, looking out beyond himself. Only the world of self is entirely dependent on that individual.
A person can manage himself, because that world begins and ends with him. He and only he can direct and control his actions. Although we like to think we can manage others, we can really only influence them; they control their muscles and thoughts, ultimately. Although parents are advised to control or manage their children, in reality parenting consists of setting limits to keep a child within the sphere in which the child can control herself. That's what a time out is all about: remove the child from the sphere where she is acting out, returning her to the sphere of her self so that she is able to regain control of herself. As the child matures, the time out evolves into being grounded. These are similar methods to assist a child to learn self-management, which is essential for becoming socialized.
Self-management is also important in the workplace. It becomes less significant as responsibilities increase, but only because the individual must be highly competent in self-management in order to gain additional responsibilities. As a person is promoted to a position in which she is responsible for the work of others, we call that person a manager. However, the most important role that person plays is to influence others, less than to manage them (if manage means control and direct). Someone who has hundreds or thousands of employees underneath him on an organizational chart can't be said to manage that many people. I can only be puzzled by resumes that claim "250 direct reports" -- just what does that mean? But even with a smaller number of direct reports: what does it mean to 'manage' them? If manage means to control and direct their actions: how is this possible?
I recall a discussion with an employee a number of years ago. He was a senior manager who led a technology team, and I knew he was unhappy. I sought the meeting to learn what was amiss. I explained to him that his success was important to me, and asked how I could be a better support for him. After a bit of talking around it, he finally blurted out, "What kind of manager are you? You aren't managing me!" Whatever I expected to hear, that was not it. This was a professional whose job description gave him significant latitude in directing his team and creating their product line. I had assumed he enjoyed that latitude. Although he didn't want me to boss him around, he was put off by my not even attempting to. We finally agreed upon some structural changes in our relationship, but I couldn't agree to do what only he could do: manage himself. I did learn, however, that the influencing skills that were working well with others in the division were less effective in working with him. I had stepped into a sphere I hadn't understood, and stumbled because I didn't recognize the difference. I had to become a novice again, with this employee, to gain a firmer footing so that I could support his success.
Influence is not a single skill or set of skills. It is less about you, and more about the sphere you are trying to influence. As one's career progresses, the spheres you encounter change in size and in kind. They change with the culture of the population within the sphere -- both the corporate culture and the varied cultures employees bring to their jobs. The sphere is impacted by changes in markets and economies. Therefore, you can never feel that you have finally achieved the skill of influence; this learning is continual.
As one's career progresses and an individual is increasingly more responsible for company outcomes, a couple of things happen. Influence becomes significantly more important, if only because the populations to be influenced become more varied and disparate. At the same time, one has an increasing opportunity to influence in an individualistic way. Although we talk about individual contributors as either professionals or non-management employees, no one is more an individual contributor than the top executive of an organization. That person has a unique opportunity to shape the culture, relationships, and outcomes for employees and customers so that they are entirely aligned with his or her personal vision. Paradoxically, as an individual's influence increases, that influence is both more personal and more outward-focused. Learning how to balance both ends of this paradox is extremely difficult: too much of one or the other can result in executives who are, in the extremes, either self-absorbed bullies or hollow shills.
So, if we superimpose these two concepts together, what do we have?
Each ring of the concentric circles indicates a new sphere of influence. It can be a different population -- assuming leadership of a new group, for instance -- but it can also be a population that has changed. Leading a company in the midst of a great recession is different from leading during a boom period, for instance. With time comes change, and although some behaviors will continue to be successful, others will not. It is at this point that the maturity of your skill set will start to show its limitations, and if you anticipate the cycle, you can start to understand what the spheres you have entered into require of you that was different. Your orbit is decaying; you will need to re-launch.
This is, I think, a more naturalistic perspective on career development. As a metaphor, it more closely reflects the human dynamics of learning and leading than do the popular notions of management and career progression. Most importantly, it is inclusive rather than exclusive: it suggests but does not proscribe. It is a metaphor of possibility that embraces failure because it enables learning and innovation. It is forgiving (don't expect yourself to be perfect all the time) and yet it is demanding (don't rest on your laurels...).
In my next post, I will move from the theoretical to the practical: so what does this look like in real life, and how could it make a difference?
Closely tied to this is an idea that as a person navigates his or her progression up the career ladder, management skills become increasingly important. This is of a piece with the idea of linear progression: the higher up you go, the more time a person spends controlling and directing others, and increasingly less time is spent making an individual contribution. I disagree on both counts.
Consider an individual's growth as a human being, starting from the first days in the cradle. We all start life completely focused on the self. An infant only focuses on objects outside himself so that he can meet his own basic needs: influencing a care giver to feed him, keep him comfortable, touch and hold him. With time, he differentiates between the people most important to him (the people who meet his needs daily) and everyone else. He strives to control the environment around him, primarily by influencing those people who can help him control it. By school-age, the individual is learning self-control, and how to influence people outside his family so that he can control his environment. Eventually, the individual expands his world to care about those he does not know personally. Over time, the individual's world expands outward by degrees, and in this process affects his relationship and responsibility to the world in concentric circles around him. Graphically, it looks something like this:
But imagine if you will that each of these circles is actually a 3-dimensional sphere comprising a world relative to the individual, who is the point at the center of it all. Of course, each sphere or world can exist without that individual; this is simply the view from the individual, looking out beyond himself. Only the world of self is entirely dependent on that individual.
A person can manage himself, because that world begins and ends with him. He and only he can direct and control his actions. Although we like to think we can manage others, we can really only influence them; they control their muscles and thoughts, ultimately. Although parents are advised to control or manage their children, in reality parenting consists of setting limits to keep a child within the sphere in which the child can control herself. That's what a time out is all about: remove the child from the sphere where she is acting out, returning her to the sphere of her self so that she is able to regain control of herself. As the child matures, the time out evolves into being grounded. These are similar methods to assist a child to learn self-management, which is essential for becoming socialized.
Self-management is also important in the workplace. It becomes less significant as responsibilities increase, but only because the individual must be highly competent in self-management in order to gain additional responsibilities. As a person is promoted to a position in which she is responsible for the work of others, we call that person a manager. However, the most important role that person plays is to influence others, less than to manage them (if manage means control and direct). Someone who has hundreds or thousands of employees underneath him on an organizational chart can't be said to manage that many people. I can only be puzzled by resumes that claim "250 direct reports" -- just what does that mean? But even with a smaller number of direct reports: what does it mean to 'manage' them? If manage means to control and direct their actions: how is this possible?
I recall a discussion with an employee a number of years ago. He was a senior manager who led a technology team, and I knew he was unhappy. I sought the meeting to learn what was amiss. I explained to him that his success was important to me, and asked how I could be a better support for him. After a bit of talking around it, he finally blurted out, "What kind of manager are you? You aren't managing me!" Whatever I expected to hear, that was not it. This was a professional whose job description gave him significant latitude in directing his team and creating their product line. I had assumed he enjoyed that latitude. Although he didn't want me to boss him around, he was put off by my not even attempting to. We finally agreed upon some structural changes in our relationship, but I couldn't agree to do what only he could do: manage himself. I did learn, however, that the influencing skills that were working well with others in the division were less effective in working with him. I had stepped into a sphere I hadn't understood, and stumbled because I didn't recognize the difference. I had to become a novice again, with this employee, to gain a firmer footing so that I could support his success.
Influence is not a single skill or set of skills. It is less about you, and more about the sphere you are trying to influence. As one's career progresses, the spheres you encounter change in size and in kind. They change with the culture of the population within the sphere -- both the corporate culture and the varied cultures employees bring to their jobs. The sphere is impacted by changes in markets and economies. Therefore, you can never feel that you have finally achieved the skill of influence; this learning is continual.
As one's career progresses and an individual is increasingly more responsible for company outcomes, a couple of things happen. Influence becomes significantly more important, if only because the populations to be influenced become more varied and disparate. At the same time, one has an increasing opportunity to influence in an individualistic way. Although we talk about individual contributors as either professionals or non-management employees, no one is more an individual contributor than the top executive of an organization. That person has a unique opportunity to shape the culture, relationships, and outcomes for employees and customers so that they are entirely aligned with his or her personal vision. Paradoxically, as an individual's influence increases, that influence is both more personal and more outward-focused. Learning how to balance both ends of this paradox is extremely difficult: too much of one or the other can result in executives who are, in the extremes, either self-absorbed bullies or hollow shills.
So, if we superimpose these two concepts together, what do we have?
Each ring of the concentric circles indicates a new sphere of influence. It can be a different population -- assuming leadership of a new group, for instance -- but it can also be a population that has changed. Leading a company in the midst of a great recession is different from leading during a boom period, for instance. With time comes change, and although some behaviors will continue to be successful, others will not. It is at this point that the maturity of your skill set will start to show its limitations, and if you anticipate the cycle, you can start to understand what the spheres you have entered into require of you that was different. Your orbit is decaying; you will need to re-launch.
This is, I think, a more naturalistic perspective on career development. As a metaphor, it more closely reflects the human dynamics of learning and leading than do the popular notions of management and career progression. Most importantly, it is inclusive rather than exclusive: it suggests but does not proscribe. It is a metaphor of possibility that embraces failure because it enables learning and innovation. It is forgiving (don't expect yourself to be perfect all the time) and yet it is demanding (don't rest on your laurels...).
In my next post, I will move from the theoretical to the practical: so what does this look like in real life, and how could it make a difference?
Monday, November 23, 2009
Up the Down Career Ladder
A young professional recently spoke to me about the unexpected turns his career had taken. Like many, he expected in his early 20s to be able to plot a course and follow that path. It’s easy to see how this happens. Career counseling often inspires young people to assume that planning a career is similar to working out a degree plan. Sign up for the courses, do the work, you get the degree. It’s sometimes a shock to learn life isn’t quite like that.
Once in the work force, young ambitious professionals can grow accustomed to being promoted fairly frequently. They can begin to assume that staying in the same job is equivalent to stagnation, which can derail your career plan. This colleague recognized that despite the fact that he was well off the path he previously thought he his career would take, he recognized this change of course had allowed him to acquire new levels of technical proficiency and develop professionally. But, the fact that he was off-road from the career path of his 20-year old self was nagging at him.
The metaphors we use to frame our life stories can limit or expand our lives. The popular metaphor of a career ladder is particularly limiting. In this frame, one’s career is supposed to look like this:
Each new position moves the individual upward toward the pinnacle, at which point one retires at the top of one’s game. During his work life, when an individual is offered a new position he must consider if that offer is incrementally higher than the last position. A lateral move – much less a ‘backward’ move – can be troubling: how will it look on the resume? For business people, the resume has become the repository of one’s life story, and by every (unwritten) business rule book, that story needs to approximate the plotted line above.
However, this is at odds with the way businesses view their own life cycles. Businesses really don’t expect their products or companies to follow that same linear progression. Rather, the received wisdom is that products and companies follow a maturity curve that looks kind of like this:
Businesses not only accept this life cycle model; the better-run businesses keep watch for signs of maturity in the market or their products, so that they are able to start the renewal cycle as early in the decline as possible.
And yet, professional development is in reality no more linear: it has a natural growth and maturity curve. Young managers typically hit the first ‘decline’ upon assuming their first real management roles. Promoted for technical competency, the new manager must now achieve results through others. First-time managers find that being ‘hands on’ and modeling the behaviors they seek from their employees don’t suffice to change others’ behaviors. The manager’s skills as an individual producer, now in their maturity, begin to drag on the upward curve of the manager’s development. The individual’s career will continue to decline unless the manager learns new skills, becoming a novice once again. Soft skills are generally harder to learn than technical skills, especially if you’re expected to learn these on your own. The manager, who previously had been proud of his accomplishments, can start to feel frustrated, as he’s expected to know how to do things for which he has no preparation. Failing to perceive the inevitable maturity decline is just as risky for the individual as for a business: it can result not in the expected plateau, but rather a downward spiral.
First-time managers are not unique in experiencing this curve; it recurs through an individual’s professional life, and the stakes grow larger over time as the safety nets grow weaker. Many businesses recognize the risk to their entry-level managers and provide them with supervisory training (minimally) and targeted development programs (optimally). But senior executives are expected to be on top of their game – how much tolerance is given for a maturity decline in professional growth to these individuals? Much money is spent on executive coaching, to be sure, within the context of fine-tuning the executive’s skills, not the wholesale reinvention of the executive’s skills. The life cycle maturity curve demands not just tweaking but reinvention. The horse-and-carriage industry didn’t need a tweaked buggy whip when Henry Ford was increasing production; they needed to get into the auto parts business.
Considering one’s own life work within the context of maturity life cycles, we should expect to experience many reinventions over the span of a career, however desparately we pretend to manifest the classic ladder-like career progression. I’ve read a lot of resumes over the years, and inevitably those life stories with obvious reinventions are shoehorned into something that can pass for a linear progression. I imagine what it might be like to read a resume like this:
2001 – 2003: Assistant Manager, Acme Corp.
Oversaw double-digit production and revenue increases by implementing a management by objectives (MBO) program.
2003 – 2004: Manager, Acme Corp
Soon after my promotion, I realized that year-on-year increases were not sustainable, particularly when we lost several key producers due to over-leveraging the MBO program. After two quarters of losses, I accepted the fact that the division needed me to be a different leader. After listening to the 360 feedback from my production team, I undertook a year of rebuilding my leadership and our team’s foundations. The year ended in a slight loss from prior year. This investment led to a phenomenal 2005 fiscal year, as measured not only by the P&L but also in employee retention and engagement.
Unfortunately, the same person’s resume is more likely to look like this:
2001 – 2003: Assistant Manager, Acme Corp.
Oversaw double-digit production and revenue increases by implementing a management by objectives program.
2003 – 2005: Manager, Acme Corp
Under my management, Acme’s production division drove unprecedented profits and revenue.
Typical wisdom is that the resume should market an individual, and therefore it is no place to acknowledge awareness of limitations or failures. For some reason, businesses think it’s in their best interest to hire only people who best convince them of their infallibility – those who exemplify the linearly progressing career. Following this logic, Barings Bank would have considered itself fortunate in 1989 to hire Nicholas Leeson, whose lessons in failure ended up costing Barings over £200 million. Barings’ loss was of course a spectacular debacle played out on the world wide stage. Yet a simple truth connects that experience to one that is universal: everything in the natural world exhibits inevitable patterns of decay and renewal. Don’t expect an artificial pattern from natural elements.
In my next post, I’ll explore an alternative that allows us to view progression in a more rewarding framework. I invite your comments.
Monday, November 9, 2009
Introducing SPC (and Relationships) into Health Care
The Sunday NY Times Magazine's cover story ("Dr James Will Make It Better", by David Leonhardt) was a fascinating look at something called 'evidence based care.' Dr. Brent James has introduced measurement into the hospital system where he works, and it sounds much like statistical process control (SPC), which has been the foundation for continuous, radical improvements in manufacturing and service industries for decades. Although I've read of other hospital systems that have used lean principles to reduce error and costs, this article implies that it's revolutionary for doctors to change the way they administer medicine based on data-based protocols. Although as a patient you may respect your doctor because of his scientific expertise, apparently many doctors have a deeply held belief that their greatest value derives from intuition. One doctor put it this way:
This kind of thinking led to extreme variation in ventilator settings, which had less than optimal outcomes for patients. A group of doctors used data to establish a protocol that James introduced as 'defaults' to the doctors in his hospitals. The soft approach worked:
Although I found myself troubled by the revelation that doctors often make their most critical decisions for a patient (what medicine, when, and how much) based on SWAG, I suppose I am to admire scientists such as Dr. James applying well-established process improvement techniques to remove variability and improve patient outcomes (often called 'life'). This reminds me of the insights I discovered in the book "Sway" (Brafman and Brafman): humans tend to go to their gut instincts especially when the risks are high, rather than use facts and logic to guide them.
As I contemplate where 'evidence based care' might take us (robotized treatment centers?), I am reminded of an interesting viewpoint from a doctor who approaches her job dramatically differently from the 'doc in a box' industry. The Nov 2009 issue of The Sun Magazine offers an interview with Dr. Pamela Wible of Oregon (see print version for complete text). She found the 'assembly line' practice in a clinic dehumanizing to her and to her patients, and so she went solo, and reshaped her job to support a strong relationship with each of her patients. She treats the person, not simply the part of the person that needs healing. She says, "I've reduced costs by humanizing the experience. People want to be cared for, which doesn't necessarily require lab work or MRIs." How she defines her work is this: "The most important therapy I deliver is a human relationship. I'm not doing anything controversial or woo-woo. I never thought of myself as practicing alternative medicine until a colleague pointed out that spending time with patients is now "alternative."'
I think it's possible to provide evidence-based care within the context of human relationships. The fact that Dr. James introduced data-based protocols initially as 'defaults' implies that he understood the importance of relationships in gaining buy-in and necessary feedback to improve the process and therefore the patient outcomes. He needed doctors like Jim Orme to enroll themselves in the process for the protocols to be used and tested. He couldn't achieve that without understanding the impacts on his relationship with these doctors.
Dr. Wible conducted eight community forums before opening her practice. She heard from her community what they needed from their health care provider. She used this data to design her practice. The three priorities for her community were: human respect; simplification; payment. I don't think her community is much different from most; these seem both basic and intuitive. The disconnect between customers and the health care industry on what customers value is wide and deep: consider the ubiquitous drug and hospital advertising that focuses on technology, complexity, and consumption.
I'm encouraged to hear different perspectives on how to transform health care and produce better results for more people. Neither viewpoint is comprehensive: yes, evidence based care is preferable to gut instinct, but doctors must care for people, not statistics. Yes, it's helpful for the doctor to listen to her patient and inquire into the patient's nutrition and home life, but science must also be applied to extend healing beyond what a lay person can do on her own. Business has long believed that the only way to reduce costs is to mass-produce and cheapen the product. These two stories illustrate that higher quality and personalization are not only preferable, but can also reduce costs and improve lives.
“I thought there wasn’t anybody better in the world at twiddling the knobs than I was,” Jim Orme, a critical-care doctor, told me later, “so I was skeptical that any protocol generated by a group of people could do better.”
This kind of thinking led to extreme variation in ventilator settings, which had less than optimal outcomes for patients. A group of doctors used data to establish a protocol that James introduced as 'defaults' to the doctors in his hospitals. The soft approach worked:
The crucial thing about the protocol was that it reduced the variation in what the doctors did. That, in turn, allowed Morris and James to isolate the aspects of treatment that made a difference. There was no way to do that when the doctors were treating patients in dozens of different ways. James has a provocative way of describing his method to doctors: “Guys, it’s more important that you do it the same way than what you think is the right way.”
As I contemplate where 'evidence based care' might take us (robotized treatment centers?), I am reminded of an interesting viewpoint from a doctor who approaches her job dramatically differently from the 'doc in a box' industry. The Nov 2009 issue of The Sun Magazine offers an interview with Dr. Pamela Wible of Oregon (see print version for complete text). She found the 'assembly line' practice in a clinic dehumanizing to her and to her patients, and so she went solo, and reshaped her job to support a strong relationship with each of her patients. She treats the person, not simply the part of the person that needs healing. She says, "I've reduced costs by humanizing the experience. People want to be cared for, which doesn't necessarily require lab work or MRIs." How she defines her work is this: "The most important therapy I deliver is a human relationship. I'm not doing anything controversial or woo-woo. I never thought of myself as practicing alternative medicine until a colleague pointed out that spending time with patients is now "alternative."'
I think it's possible to provide evidence-based care within the context of human relationships. The fact that Dr. James introduced data-based protocols initially as 'defaults' implies that he understood the importance of relationships in gaining buy-in and necessary feedback to improve the process and therefore the patient outcomes. He needed doctors like Jim Orme to enroll themselves in the process for the protocols to be used and tested. He couldn't achieve that without understanding the impacts on his relationship with these doctors.
Dr. Wible conducted eight community forums before opening her practice. She heard from her community what they needed from their health care provider. She used this data to design her practice. The three priorities for her community were: human respect; simplification; payment. I don't think her community is much different from most; these seem both basic and intuitive. The disconnect between customers and the health care industry on what customers value is wide and deep: consider the ubiquitous drug and hospital advertising that focuses on technology, complexity, and consumption.
I'm encouraged to hear different perspectives on how to transform health care and produce better results for more people. Neither viewpoint is comprehensive: yes, evidence based care is preferable to gut instinct, but doctors must care for people, not statistics. Yes, it's helpful for the doctor to listen to her patient and inquire into the patient's nutrition and home life, but science must also be applied to extend healing beyond what a lay person can do on her own. Business has long believed that the only way to reduce costs is to mass-produce and cheapen the product. These two stories illustrate that higher quality and personalization are not only preferable, but can also reduce costs and improve lives.
Monday, October 19, 2009
It matters how money is made
"Everything happens in the context of relationships."
This concept was a revelation to me a few years ago. I'd been raised on a different business ethic: "Don't bring your personal life to work." In this way of thinking, your job specifies the 'role' you play.To be successful, you must not only embody the role, but also recognize the roles others are playing, and with them perform an unseen script. Bringing one's personal self to work, and interacting with others' personal selves, can't be tolerated, since this intrusion gets in the way of achieving business goals. Good workers must strive single-mindedly toward meeting the corporation's objectives. Those who do this well will be rewarded.
Being very driven operationally and technically, I was more than receptive to a de-personalized work place, and approaching my work this way usually produced good business results. But, when I sought feedback from peers and direct reports, I heard a consistent message that I was 'at times' not approachable. Those 'times' occurred when I was most intently driving to a business objective: meeting a project deadline; overcoming obstacles in reaching business goals. I was grateful that I had good enough relationships with others that they felt comfortable sharing this with me, and yet for years I failed to understand what I could do about it, other than try to play my role a bit differently.
And then a couple years ago, I came across what seemed a completely revolutionary thought: Everything happens in the context of relationships. If you care for those relationships, your outcomes will exceed your expectations. The person you are as a leader either enables or prevents others to be successful. If the people you lead are not being successful, look first to the relationship between you. Is it characterized by honesty and disclosure? Is it apparent to the other person that you care about his or her success, and that you bring a sincere interest in understanding both the facts and feelings of the relationship? As I've put this learning to practice, I have a growing appreciation for its power. A business is not a disembodied entity that people work for. A business is the people who work in it, and it changes measurably as the people within it change. It is simply the sum of the outcomes produced by those peoples' relationships, popularly called 'teamwork.' Moreover, the business exists within the environment of its community: consciously or not, the business contributes to community-based relationships, for good or ill.
Following the nation's economic news, I have come to realize a fundamental difference in the ethos of the community and that of many corporations. The people who work in businesses and whose communities are affected by them share a relationship-based ethos. Listen to interviews of workers who have been laid off recently. Whether the workers are young in their careers or have spent a lifetime with the company, they speak emotionally about their loss: not only of the loss of their livelihood, but also of the relationships lost to them. They speak of the close ties they have forged with co-workers, their 'second family' at work, and of the pride they have taken in what they accomplished together. People view work as more than an exchange of time for money. They bring to work not only their physical bodies but also all the complexities of their personalities, histories, emotions, and aspirations.They witness the contributions that they produce individually and with others for the business. All of the corporate talk of 'teamwork' just reinforces with them the importance of relationships as the singular engine for corporate success.
A corporation tethered by the concept of itself within its de-personalized person-hood can never understand the power that actually drives success in its business. The business's responsibility for its relationships with its employees and community trumps the profit imperative. In my work, I am responsible for profitability, and I take that responsibility seriously. So seriously, that I maintain that a business cannot be profitable both today and in the future unless its management understands that everything happens in the context of relationships. Failure to understand this leads to toxic debt packages that lead to rampant foreclosures that lead to ultimate insolvency (unless your business is 'too big to fail'). It leads to double-digit unemployment, with unimaginable human misery and long-term scarring with unknowable economic impact. It leads to toxic food, loss of life and health. The tolls are incalculable - and for what end?
Profits do not have to suffer as relationships are honored; my experience is that in fact, quite the opposite is true. This seems counter-intuitive only if you accept that the corporation is a mechanical entity that exists only to produce profits. However if you assume that the corporation is the sum of the people who work together to produce services or products profitably, and that the business exists within the context of the community upon which it depends, then it seems perfectly reasonable if not inevitable. I work in a company governed by a set of values that give shape to the relationships inside and outside the business. Not so coincidentally, the company has produced year-on-year growth every year (this one included) since embracing these values. The company's values are not just nice-to-haves; they are essential to the company's business plans and its success.
If all actions were based on the profit imperative, irrespective of relationships, human society as we know it would not be possible. Yet, even when our communities bear the manifold costs of the financial collapse caused by uncontrolled profiteering, society is reluctant to hold the bad actors accountable. I think our failure is partly grounded in an unmindful acceptance of their ethos, even when we do not share in it. We have accepted too readily that as long as it's legal, it's acceptable. But it matters how money is made. Legality is a low standard indeed for a society's norms, and you have to ask:who has decided what is legal and what is not?
Let us accept that human society is nothing if not the relationships that allow us to live together successfully to produce successive generations who may also thrive. Economic security and success are interwoven with those relationships. Everything happens in the context of relationships.
This concept was a revelation to me a few years ago. I'd been raised on a different business ethic: "Don't bring your personal life to work." In this way of thinking, your job specifies the 'role' you play.To be successful, you must not only embody the role, but also recognize the roles others are playing, and with them perform an unseen script. Bringing one's personal self to work, and interacting with others' personal selves, can't be tolerated, since this intrusion gets in the way of achieving business goals. Good workers must strive single-mindedly toward meeting the corporation's objectives. Those who do this well will be rewarded.
Being very driven operationally and technically, I was more than receptive to a de-personalized work place, and approaching my work this way usually produced good business results. But, when I sought feedback from peers and direct reports, I heard a consistent message that I was 'at times' not approachable. Those 'times' occurred when I was most intently driving to a business objective: meeting a project deadline; overcoming obstacles in reaching business goals. I was grateful that I had good enough relationships with others that they felt comfortable sharing this with me, and yet for years I failed to understand what I could do about it, other than try to play my role a bit differently.
And then a couple years ago, I came across what seemed a completely revolutionary thought: Everything happens in the context of relationships. If you care for those relationships, your outcomes will exceed your expectations. The person you are as a leader either enables or prevents others to be successful. If the people you lead are not being successful, look first to the relationship between you. Is it characterized by honesty and disclosure? Is it apparent to the other person that you care about his or her success, and that you bring a sincere interest in understanding both the facts and feelings of the relationship? As I've put this learning to practice, I have a growing appreciation for its power. A business is not a disembodied entity that people work for. A business is the people who work in it, and it changes measurably as the people within it change. It is simply the sum of the outcomes produced by those peoples' relationships, popularly called 'teamwork.' Moreover, the business exists within the environment of its community: consciously or not, the business contributes to community-based relationships, for good or ill.
Following the nation's economic news, I have come to realize a fundamental difference in the ethos of the community and that of many corporations. The people who work in businesses and whose communities are affected by them share a relationship-based ethos. Listen to interviews of workers who have been laid off recently. Whether the workers are young in their careers or have spent a lifetime with the company, they speak emotionally about their loss: not only of the loss of their livelihood, but also of the relationships lost to them. They speak of the close ties they have forged with co-workers, their 'second family' at work, and of the pride they have taken in what they accomplished together. People view work as more than an exchange of time for money. They bring to work not only their physical bodies but also all the complexities of their personalities, histories, emotions, and aspirations.They witness the contributions that they produce individually and with others for the business. All of the corporate talk of 'teamwork' just reinforces with them the importance of relationships as the singular engine for corporate success.
A corporation tethered by the concept of itself within its de-personalized person-hood can never understand the power that actually drives success in its business. The business's responsibility for its relationships with its employees and community trumps the profit imperative. In my work, I am responsible for profitability, and I take that responsibility seriously. So seriously, that I maintain that a business cannot be profitable both today and in the future unless its management understands that everything happens in the context of relationships. Failure to understand this leads to toxic debt packages that lead to rampant foreclosures that lead to ultimate insolvency (unless your business is 'too big to fail'). It leads to double-digit unemployment, with unimaginable human misery and long-term scarring with unknowable economic impact. It leads to toxic food, loss of life and health. The tolls are incalculable - and for what end?
Profits do not have to suffer as relationships are honored; my experience is that in fact, quite the opposite is true. This seems counter-intuitive only if you accept that the corporation is a mechanical entity that exists only to produce profits. However if you assume that the corporation is the sum of the people who work together to produce services or products profitably, and that the business exists within the context of the community upon which it depends, then it seems perfectly reasonable if not inevitable. I work in a company governed by a set of values that give shape to the relationships inside and outside the business. Not so coincidentally, the company has produced year-on-year growth every year (this one included) since embracing these values. The company's values are not just nice-to-haves; they are essential to the company's business plans and its success.
If all actions were based on the profit imperative, irrespective of relationships, human society as we know it would not be possible. Yet, even when our communities bear the manifold costs of the financial collapse caused by uncontrolled profiteering, society is reluctant to hold the bad actors accountable. I think our failure is partly grounded in an unmindful acceptance of their ethos, even when we do not share in it. We have accepted too readily that as long as it's legal, it's acceptable. But it matters how money is made. Legality is a low standard indeed for a society's norms, and you have to ask:who has decided what is legal and what is not?
Let us accept that human society is nothing if not the relationships that allow us to live together successfully to produce successive generations who may also thrive. Economic security and success are interwoven with those relationships. Everything happens in the context of relationships.
Monday, October 5, 2009
Lean takes on a new meaning
Update 8 October 09:
This morning's NYTimes reports that Costco has worked out a supply agreement with Tyson, allowing Costco to test Tyson's products prior to resale. And, there's some speechifying from the administration and Congress. Would be encouraging if this goes somewhere, but it's hard to see it will.
The Sunday NY Times featured a front-page story, shocking and deeply disturbing, that explained how E. coli contamination is allowed to occur in the US meat industry. In one example, meat sold under the product name "American Chef’s Selection Angus Beef Patties" was actually a mixture of meat products made by Cargill from three separate suppliers. None of these suppliers, nor the producer of 'American Chef's Selection Angus Beef Patties,' tested their products for contamination. Ms. Smith, a young woman who ate a hamburger made of this meat, became critically ill and is paralyzed.
But, you may wonder, I thought Sinclair's The Jungle changed all of this last century ... don't we have regulations that protect the consumer? That would be the USDA, and this is what they say:
No doubt Cargill has worked its supply chain relationships to drive down costs, but it's certainly not practicing Lean principles. This is old-fashioned greed. The article takes pains to point out that Costco, known for its supply chain and cost management, insists on testing the meat it procures: those suppliers who don't want their products tested (like Tyson) don't sell to Costco. Dr. Petersen should not worry about protecting the businesses he regulates. If they have to charge 30 cents more to produce meat that is clean, so be it. What consumer wouldn't prefer to pay an incremental difference for the peace of mind?
The kink in that argument is that consumer trust is badly eroded, because regulation has not been enforced where it exists, and it has been severely cut back. Protections we once enjoyed have been hacked away under the philosophy that government is bad. We are reaping the results now, not only in unclean food but also in huge economic failures. If consumers no longer trust that they are being protected, how can a business assure its customer that the higher price of its product is due to the product really being what it's labeled? Bubba Burgers, the article tells us, attempts to differentiate its product by this label: “100% whole muscle means no trimmings.” Until I read this article, I would have had no appreciation for what's behind this message (or what something called 'fine lean textured beef' really is - for starters, the raw material for this substance is up to 70% fat; centrifuges and ammonia are involved). If you're purchasing ground beef based on label information alone, which would you think the safer choice for your family: Bubba Burgers, or American Chef's Selection Angus Beef Patties? They both bear the USDA Approval label. What are you supposed to make of that?
And yet, I have little expectation that the article will have much more of an effect than grossing out its readers. Maybe Costco will get a brief uptick in their meat department. Maybe grocery store butchers will have more requests this week for grinding whole cuts of meat for customers. That's fine, but it's not the solution. Why shouldn't we expect businesses to eliminate costs by reducing waste, not by reducing quality? Why should we not insist that government do what we individually cannot do? Why are we paying the salaries of bureaucrats who seek to protect the industries they are supposed to regulate, at the expense of citizens? Why aren't we demanding substantive change?
President Obama campaigned on change, and surely that's the message that gave him a four-year lease at 1600 Pennsylvania Ave. Yet since January, simply the prospect of change has become radicalized. Even in the face of incontrovertible evidence that the status quo is harmful, leaders are fearful of taking a stand for change, as if the safe position was to stand pat. Geoffrey Miller, in his book Spent, cites studies that correlate threat of disease in a population with low ratings of openness. The more people sense threats they cannot control, they become more resistant to change and fearful of outsiders. We can look around us and see catastrophe on all sides: environment, financial sector, housing, employment, education, health care. The response of some will be: "We need to do something about that!" Apparently, even more people will hunker down in their misery, and attack those who press for change.
You don't have to play to those fears, however. If they trust their leadership, people can be inspired to overcome their fears and act. Recently at work, we set a challenge for the stores to achieve sales levels never consistently met before. We were responding to the same economy that other retailers are using to justify hunkering down: cutting back, hyping poor values. But, we decided to inspire new levels of performance. I could give the stores no magic bullet, no certainty that they would succeed -- just my belief they would. I asked them to look only within the walls of their own stores to see what they could do to transform the experience of our customers, and deliver even greater value to them. And you know what? They did it.
This morning's NYTimes reports that Costco has worked out a supply agreement with Tyson, allowing Costco to test Tyson's products prior to resale. And, there's some speechifying from the administration and Congress. Would be encouraging if this goes somewhere, but it's hard to see it will.
The Sunday NY Times featured a front-page story, shocking and deeply disturbing, that explained how E. coli contamination is allowed to occur in the US meat industry. In one example, meat sold under the product name "American Chef’s Selection Angus Beef Patties" was actually a mixture of meat products made by Cargill from three separate suppliers. None of these suppliers, nor the producer of 'American Chef's Selection Angus Beef Patties,' tested their products for contamination. Ms. Smith, a young woman who ate a hamburger made of this meat, became critically ill and is paralyzed.
In combining the ingredients, Cargill was following a common industry practice of mixing trim from various suppliers to hit the desired fat content for the least money, industry officials said. [...] In all, the ingredients for Ms. Smith’s burger cost Cargill about $1 a pound, company records show, or about 30 cents less than industry experts say it would cost for ground beef made from whole cuts of meat [....] The listed ingredients revealed little of how the meat was made. There was just one meat product listed: “Beef.”
But, you may wonder, I thought Sinclair's The Jungle changed all of this last century ... don't we have regulations that protect the consumer? That would be the USDA, and this is what they say:
Dr. Kenneth Petersen, an assistant administrator with the department’s Food Safety and Inspection Service, said that the department could mandate testing, but that it needed to consider the impact on companies as well as consumers. “I have to look at the entire industry, not just what is best for public health,” Dr. Petersen said.
The kink in that argument is that consumer trust is badly eroded, because regulation has not been enforced where it exists, and it has been severely cut back. Protections we once enjoyed have been hacked away under the philosophy that government is bad. We are reaping the results now, not only in unclean food but also in huge economic failures. If consumers no longer trust that they are being protected, how can a business assure its customer that the higher price of its product is due to the product really being what it's labeled? Bubba Burgers, the article tells us, attempts to differentiate its product by this label: “100% whole muscle means no trimmings.” Until I read this article, I would have had no appreciation for what's behind this message (or what something called 'fine lean textured beef' really is - for starters, the raw material for this substance is up to 70% fat; centrifuges and ammonia are involved). If you're purchasing ground beef based on label information alone, which would you think the safer choice for your family: Bubba Burgers, or American Chef's Selection Angus Beef Patties? They both bear the USDA Approval label. What are you supposed to make of that?
And yet, I have little expectation that the article will have much more of an effect than grossing out its readers. Maybe Costco will get a brief uptick in their meat department. Maybe grocery store butchers will have more requests this week for grinding whole cuts of meat for customers. That's fine, but it's not the solution. Why shouldn't we expect businesses to eliminate costs by reducing waste, not by reducing quality? Why should we not insist that government do what we individually cannot do? Why are we paying the salaries of bureaucrats who seek to protect the industries they are supposed to regulate, at the expense of citizens? Why aren't we demanding substantive change?
President Obama campaigned on change, and surely that's the message that gave him a four-year lease at 1600 Pennsylvania Ave. Yet since January, simply the prospect of change has become radicalized. Even in the face of incontrovertible evidence that the status quo is harmful, leaders are fearful of taking a stand for change, as if the safe position was to stand pat. Geoffrey Miller, in his book Spent, cites studies that correlate threat of disease in a population with low ratings of openness. The more people sense threats they cannot control, they become more resistant to change and fearful of outsiders. We can look around us and see catastrophe on all sides: environment, financial sector, housing, employment, education, health care. The response of some will be: "We need to do something about that!" Apparently, even more people will hunker down in their misery, and attack those who press for change.
You don't have to play to those fears, however. If they trust their leadership, people can be inspired to overcome their fears and act. Recently at work, we set a challenge for the stores to achieve sales levels never consistently met before. We were responding to the same economy that other retailers are using to justify hunkering down: cutting back, hyping poor values. But, we decided to inspire new levels of performance. I could give the stores no magic bullet, no certainty that they would succeed -- just my belief they would. I asked them to look only within the walls of their own stores to see what they could do to transform the experience of our customers, and deliver even greater value to them. And you know what? They did it.
Monday, September 21, 2009
Whose problem is it anyway?
One of our corporate departments is implementing a SaaS application across the company. The application requires that every employee register independently. This is not going well: despite a tremendous effort by the project manager and each location manager, the task deadline is blown and still not complete. The implementation team asked me to pitch in to get this task over the line, something I have been happy to support. And yet, I realize that the only reason we are throwing so many hours at what seemingly was a simple task in the project plan is that the vendor designed an extremely poor process. The application's functionality depends on the independent registration of all employees, using a method that has an overly-complex opt-in design. Just how wrong is that?
Well, the vendor, who only recently minted this application, is committed to the design and has taken the position that it's a 'user problem.' This takes me back to the bad old days of vendor arrogance. Engineers would dictate business processes to all of their clients, even though those engineers had no working experience in the industries or markets of their clients. That didn't work especially well, so technology companies started offering customization services. The end result was essentially unchanged: the business could only contribute to the user requirements documentation, using the vendor's consultants as a conduit. The vendor still retained complete control over the design and specifications. The attitude was: we'll tell you how to run your business. Errors that resulted because the client's employees failed to use the (increasingly complex) system correctly (that is, the way an engineer thought it should be used) were the responsibility of the client. If the client asked for changes to make it easier for their employees to use the system, the client had to foot the bill and increase their risk of process failures due to the introduction of new code.
This may be the world that your business operates in, still. For many, the only opt-out option has been to bring design and modification in-house, so that development can respond to the actual needs of the business and its users. Truly opting out has not been possible for businesses using ERP systems: the cost and time involved in system replacement, and the disruption to the business, are great.
But in this decade, a new model has arisen from consumer-driven technology, which has flipped design on its head. If a web page, or a cell phone, or a mobile app, doesn't work the way the consumer wants to use it, the consumer can easily abandon it. Exit barriers are almost nonexistent in consumer technology. Consumers expect plug and play. They expect to be able to cut and paste from one application to another. They expect the software to be very forgiving, and to let them interact with the software many ways. Consumer technology companies do not expect the consumer to read a user manual, or follow work instructions to use the software. And you know what? These expectations are increasingly met, consistently.
Maybe the signal difference is that the consumer technology business's customers are the users of their technology. Business technology providers still think that their customers are the company execs who sign the contracts (and may never use the technology), not the employees who use the software. If your current ERP provider had to pitch to your front-line employees, would they keep your company's business?
Well, the vendor, who only recently minted this application, is committed to the design and has taken the position that it's a 'user problem.' This takes me back to the bad old days of vendor arrogance. Engineers would dictate business processes to all of their clients, even though those engineers had no working experience in the industries or markets of their clients. That didn't work especially well, so technology companies started offering customization services. The end result was essentially unchanged: the business could only contribute to the user requirements documentation, using the vendor's consultants as a conduit. The vendor still retained complete control over the design and specifications. The attitude was: we'll tell you how to run your business. Errors that resulted because the client's employees failed to use the (increasingly complex) system correctly (that is, the way an engineer thought it should be used) were the responsibility of the client. If the client asked for changes to make it easier for their employees to use the system, the client had to foot the bill and increase their risk of process failures due to the introduction of new code.
This may be the world that your business operates in, still. For many, the only opt-out option has been to bring design and modification in-house, so that development can respond to the actual needs of the business and its users. Truly opting out has not been possible for businesses using ERP systems: the cost and time involved in system replacement, and the disruption to the business, are great.
But in this decade, a new model has arisen from consumer-driven technology, which has flipped design on its head. If a web page, or a cell phone, or a mobile app, doesn't work the way the consumer wants to use it, the consumer can easily abandon it. Exit barriers are almost nonexistent in consumer technology. Consumers expect plug and play. They expect to be able to cut and paste from one application to another. They expect the software to be very forgiving, and to let them interact with the software many ways. Consumer technology companies do not expect the consumer to read a user manual, or follow work instructions to use the software. And you know what? These expectations are increasingly met, consistently.
Maybe the signal difference is that the consumer technology business's customers are the users of their technology. Business technology providers still think that their customers are the company execs who sign the contracts (and may never use the technology), not the employees who use the software. If your current ERP provider had to pitch to your front-line employees, would they keep your company's business?
Monday, August 31, 2009
On Best Practice (or not)
Susan Cramm asks in a post today 'Why Do We Ignore "Best Practices"?.' She cites a CIO who has rejected using a proven project methodology on a high-risk project -- a decision that has now jeopardized his project. Cramm is interested in understanding why people who know better put their projects or even their jobs at risk by failing to use known best practices. The post suggests that the CIO engendered risk on his project because he ignored best practice. I suspect the dynamic is rather different: since the project was high-risk, he ignored best practice... because he knew better.
I wrote on this just about a year ago, when I was reading Ori and Ram Brafman's insightful book "Sway: The Irresistible Pull of Irrational Behavior." Particularly when the risks are high, educated well-seasoned professionals abdicate the normal rules (rational but unnatural practices) for emotionally-based instinctive responses -- not what one thinks one ought to do, but what one feels should be done. At the moment the professional reverts to 'common sense' in a life-or-death moment, you might as well place your destiny in the hands of the evolutionary ancestor for whom this worked often enough to pass along his genes. He may have been a veteran airline pilot when your plane took off; in an emergency, you hope he doesn't turn into a Cro-Magnon mid-flight.
There's probably a biological reason why this happens, but our culture certainly reinforces it powerfully. The American culture deifies the action hero for whom normal rules do not apply. Interestingly, these heroes often have a skill set that is only acquired through much professional, rigorous training -- Rambo, Dirty Harry, Gordon Gecko. Because they are at the apex of their professions, we willingly grant them license to discard all of that and play by their own rules. We revere their irreverence for rules that lesser mortals (like us) have to live by. Maybe their Hollywood-style outcomes justify what we really believe is the 'best' practice - acting on instinct.
My older post reminded me of the project that inspired it. At the time, I needed to make a decision on how best to help the team get back on track. We shared the same goals, so alignment was not a problem. No one disputed the metrics; the team understood they were not hitting them despite being highly focused on them. We had a clear difference of opinion on what process changes should be made -- and since I'm corporate, it was easy to assume that I just didn't understand. The team really wanted to achieve their goals, and their confidence in meeting them was based on their belief in their solutions. It felt like an impasse.
So it's a year later: how did it turn out? The team achieved a break-through, and this year has consistently far exceeded what we previously thought would be high-performance results, based on prior benchmarks. Their results are inspirational, and I am awed by their achievements. Yes, we got back to 'best practices' in process improvement, but not by forcing it on them. Instead, I realized that I was working with a team that was highly focused on results. The team thought the goal was the metric, which felt high-risk because they didn't know how to move it. So, they brought their emotions to solving the problem. I simply changed their immediate goal: they would demonstrate to me their competency in process improvement. I agreed that they could implement whatever changes they could support with data from their process analysis.
In the end, they made only a slight change to the process. And yet - they are achieving far more out of their process than they did before. Why? Well, it turns out that during their process analysis the team started to understand why some steps were best practice even though they seemed counter-intuitive. All of the team came to embrace the process as written, and once it was no longer subverted by well-meaning team members who thought they knew better, the process started working for them. After their break-through, I asked one employee how they were so successful. He responded: "It's the process. Don't take my process away from me." It's now their process, not corporate's. I wouldn't dream of touching it now.
Cramm's CIO will never be convinced to change his course by rational argument, nor by increasingly dire metrics from his project. Because he cares deeply, and because he is professionally trained, he is all the more likely to continue with his decision, to which he's by now irrevocably committed. If his board were to take the risk off the table, and re-frame the task in a way that enabled him to bring his professional judgment back online, it's possible he could make a fundamental shift that would engender success.
I wrote on this just about a year ago, when I was reading Ori and Ram Brafman's insightful book "Sway: The Irresistible Pull of Irrational Behavior." Particularly when the risks are high, educated well-seasoned professionals abdicate the normal rules (rational but unnatural practices) for emotionally-based instinctive responses -- not what one thinks one ought to do, but what one feels should be done. At the moment the professional reverts to 'common sense' in a life-or-death moment, you might as well place your destiny in the hands of the evolutionary ancestor for whom this worked often enough to pass along his genes. He may have been a veteran airline pilot when your plane took off; in an emergency, you hope he doesn't turn into a Cro-Magnon mid-flight.
There's probably a biological reason why this happens, but our culture certainly reinforces it powerfully. The American culture deifies the action hero for whom normal rules do not apply. Interestingly, these heroes often have a skill set that is only acquired through much professional, rigorous training -- Rambo, Dirty Harry, Gordon Gecko. Because they are at the apex of their professions, we willingly grant them license to discard all of that and play by their own rules. We revere their irreverence for rules that lesser mortals (like us) have to live by. Maybe their Hollywood-style outcomes justify what we really believe is the 'best' practice - acting on instinct.
My older post reminded me of the project that inspired it. At the time, I needed to make a decision on how best to help the team get back on track. We shared the same goals, so alignment was not a problem. No one disputed the metrics; the team understood they were not hitting them despite being highly focused on them. We had a clear difference of opinion on what process changes should be made -- and since I'm corporate, it was easy to assume that I just didn't understand. The team really wanted to achieve their goals, and their confidence in meeting them was based on their belief in their solutions. It felt like an impasse.
So it's a year later: how did it turn out? The team achieved a break-through, and this year has consistently far exceeded what we previously thought would be high-performance results, based on prior benchmarks. Their results are inspirational, and I am awed by their achievements. Yes, we got back to 'best practices' in process improvement, but not by forcing it on them. Instead, I realized that I was working with a team that was highly focused on results. The team thought the goal was the metric, which felt high-risk because they didn't know how to move it. So, they brought their emotions to solving the problem. I simply changed their immediate goal: they would demonstrate to me their competency in process improvement. I agreed that they could implement whatever changes they could support with data from their process analysis.
In the end, they made only a slight change to the process. And yet - they are achieving far more out of their process than they did before. Why? Well, it turns out that during their process analysis the team started to understand why some steps were best practice even though they seemed counter-intuitive. All of the team came to embrace the process as written, and once it was no longer subverted by well-meaning team members who thought they knew better, the process started working for them. After their break-through, I asked one employee how they were so successful. He responded: "It's the process. Don't take my process away from me." It's now their process, not corporate's. I wouldn't dream of touching it now.
Cramm's CIO will never be convinced to change his course by rational argument, nor by increasingly dire metrics from his project. Because he cares deeply, and because he is professionally trained, he is all the more likely to continue with his decision, to which he's by now irrevocably committed. If his board were to take the risk off the table, and re-frame the task in a way that enabled him to bring his professional judgment back online, it's possible he could make a fundamental shift that would engender success.
Monday, August 24, 2009
"And you may ask yourself..."
The rise of the agrarian culture. Health-care reform. Jared Diamond's book Collapse. Public dialogue about governmental and international policy. Talking Heads. Businesses that awaken too late to impending demise. Fear of failure. These are all on my mind today.
It all started innocently enough, as my husband and I, enjoying a lovely late-summer bike ride this morning, discussed our hypotheses on the establishment of agriculture by formerly migratory human populations. (I guess some people exercise to exercise -- that is, to become more fit or achieve athletic goals. I exercise to think; it's a marvelous way to give the brain what it needs to think creatively, and what great fortune that the rest of the body benefits as well!) So anyway, as we talked, I started imagining what it may have been like to live in a culture that started the transition from opportunistically gathering food from the surrounding environment, to creating sources of nutrition that could sustain a settled population.
I'd never really thought about this much. In school I was told that once people started farming, they weren't so mobile and they settled down and started creating social mechanisms to support and defend their settlement. I must have assumed that (1) this was the sequence of events (farming then settlement then defense and other infrastructure) and (2) this was a life style choice - like city dwellers leaving to start up farms in the countryside. But someone who has lived after the establishment of agriculture has the advantage of accumulated human knowledge: even if the individual knows nothing about farming, he or she can easily find out from people who know, and has access to markets that will supply the raw materials and tools that are required. What if there is no human knowledge to be had, and farming tools are nonexistent?
The first humans to engage in farming must have failed a lot before they succeeded. Creating knowledge is like that: you start from ignorance, and try things out. You learn what works and what doesn't from the mistakes you make. Risk of failure must be quite high: a lot of effort with poor yield in the beginning, and long lead times (a growing season) before you know whether your efforts were successful or not. Meanwhile, you're caring for yourself and others who need nutrition every day, and your movement is limited, since you have to remain close to the plants you're trying to grow. Chances are, the area where you've settled is not overly rich in naturally-occurring food, or why would you be putting so much effort into farming your own? The risk of failure is quite high -- starting from ignorance, it's probable that initially, failure is certain. People die if crops fail and they aren't able to supplement their diet sufficiently with nutrition from the immediate environment. How is it that people stayed with this endeavor long enough to accrue the necessary knowledge to become successful?
I can only imagine that the immediate risks of not doing it were much higher than the risks of doing it. Groups of people do not assume any risk, much less one that could only have resulted in death amongst their own population, unless they are compelled to do so by a much more extreme and inescapable risk. As a species, we are extremely unimaginative. Risks that could eventuate next year - much less in your child's lifetime -- are just not compelling enough. It could happen -- and the optimistic, here-and-now human brain thinks "Yeah, but it's also possible it won't happen, so let's not rock the boat." It's not enough that the status quo produces hardship and loss; if we've become accustomed to these, they are less fearsome than the fear of the unknown. Diamond's book explains eloquently how one civilization after another faced imminent collapse because of the choices they made, and how many of them clung to the catastrophic choices that ultimately destroyed them. So whatever was happening in these proto-agrarian societies must have been fearsome indeed. Some populations probably decided they could not change their practices, and they perished. Some did, and generations have been sustained by their decision.
There's a lesson here, regardless your viewpoint on how to tackle the many issues facing this nation and those around the world. You can take your pick of disasters: the status quo is unacceptable in any of them. We have to make different choices. We have to do things differently than we've ever done them before, and because we will be novices, we will fail as we seek to learn how to be successful. It could be that, as in the apocryphal Thanksgiving parable, we can metaphorically learn from others how to plant corn and stave off the impending starvation of the colony. It can also be the case that we face some things (how to maintain peace in an increasingly volatile nuclear world; how to sustain the environment as the atmosphere starts to boil) as a species for which we have no collective wisdom.
On a smaller scale, businesses need to do the same: both Wall St and Main St businesses have failed to see disaster looming, and even after this recession's corporate body blows, so few businesses have actually taken on the equivalent of the migratory tribe's foray into agriculture. Too many businesses are just waiting for the bubble to return; that's their plan. Unfortunately, some will stick with the plan until they are no longer around -- wiping out the livelihood of their employees and adding to the continued rise of unemployment. And if the business is considered too big to fail -- well, we'll all pay for that, won't we?
It helps me to realize that what I see around me is the same as it ever was; not that this is comforting, but at least it it helps me understand why so many are clutching desperately to fictions rather than face what is blindingly apparent. And yet, there's a part of the human psyche also that can be thrilled by the adventure of going 'where no man has gone before.' Leaders need to do a much better job of tapping into the uplifting aspect of adventure and opportunity in the face of adversity, while steadfastly loosening the population's terrified grip on the deadly status quo.
It all started innocently enough, as my husband and I, enjoying a lovely late-summer bike ride this morning, discussed our hypotheses on the establishment of agriculture by formerly migratory human populations. (I guess some people exercise to exercise -- that is, to become more fit or achieve athletic goals. I exercise to think; it's a marvelous way to give the brain what it needs to think creatively, and what great fortune that the rest of the body benefits as well!) So anyway, as we talked, I started imagining what it may have been like to live in a culture that started the transition from opportunistically gathering food from the surrounding environment, to creating sources of nutrition that could sustain a settled population.
I'd never really thought about this much. In school I was told that once people started farming, they weren't so mobile and they settled down and started creating social mechanisms to support and defend their settlement. I must have assumed that (1) this was the sequence of events (farming then settlement then defense and other infrastructure) and (2) this was a life style choice - like city dwellers leaving to start up farms in the countryside. But someone who has lived after the establishment of agriculture has the advantage of accumulated human knowledge: even if the individual knows nothing about farming, he or she can easily find out from people who know, and has access to markets that will supply the raw materials and tools that are required. What if there is no human knowledge to be had, and farming tools are nonexistent?
The first humans to engage in farming must have failed a lot before they succeeded. Creating knowledge is like that: you start from ignorance, and try things out. You learn what works and what doesn't from the mistakes you make. Risk of failure must be quite high: a lot of effort with poor yield in the beginning, and long lead times (a growing season) before you know whether your efforts were successful or not. Meanwhile, you're caring for yourself and others who need nutrition every day, and your movement is limited, since you have to remain close to the plants you're trying to grow. Chances are, the area where you've settled is not overly rich in naturally-occurring food, or why would you be putting so much effort into farming your own? The risk of failure is quite high -- starting from ignorance, it's probable that initially, failure is certain. People die if crops fail and they aren't able to supplement their diet sufficiently with nutrition from the immediate environment. How is it that people stayed with this endeavor long enough to accrue the necessary knowledge to become successful?
I can only imagine that the immediate risks of not doing it were much higher than the risks of doing it. Groups of people do not assume any risk, much less one that could only have resulted in death amongst their own population, unless they are compelled to do so by a much more extreme and inescapable risk. As a species, we are extremely unimaginative. Risks that could eventuate next year - much less in your child's lifetime -- are just not compelling enough. It could happen -- and the optimistic, here-and-now human brain thinks "Yeah, but it's also possible it won't happen, so let's not rock the boat." It's not enough that the status quo produces hardship and loss; if we've become accustomed to these, they are less fearsome than the fear of the unknown. Diamond's book explains eloquently how one civilization after another faced imminent collapse because of the choices they made, and how many of them clung to the catastrophic choices that ultimately destroyed them. So whatever was happening in these proto-agrarian societies must have been fearsome indeed. Some populations probably decided they could not change their practices, and they perished. Some did, and generations have been sustained by their decision.
There's a lesson here, regardless your viewpoint on how to tackle the many issues facing this nation and those around the world. You can take your pick of disasters: the status quo is unacceptable in any of them. We have to make different choices. We have to do things differently than we've ever done them before, and because we will be novices, we will fail as we seek to learn how to be successful. It could be that, as in the apocryphal Thanksgiving parable, we can metaphorically learn from others how to plant corn and stave off the impending starvation of the colony. It can also be the case that we face some things (how to maintain peace in an increasingly volatile nuclear world; how to sustain the environment as the atmosphere starts to boil) as a species for which we have no collective wisdom.
On a smaller scale, businesses need to do the same: both Wall St and Main St businesses have failed to see disaster looming, and even after this recession's corporate body blows, so few businesses have actually taken on the equivalent of the migratory tribe's foray into agriculture. Too many businesses are just waiting for the bubble to return; that's their plan. Unfortunately, some will stick with the plan until they are no longer around -- wiping out the livelihood of their employees and adding to the continued rise of unemployment. And if the business is considered too big to fail -- well, we'll all pay for that, won't we?
It helps me to realize that what I see around me is the same as it ever was; not that this is comforting, but at least it it helps me understand why so many are clutching desperately to fictions rather than face what is blindingly apparent. And yet, there's a part of the human psyche also that can be thrilled by the adventure of going 'where no man has gone before.' Leaders need to do a much better job of tapping into the uplifting aspect of adventure and opportunity in the face of adversity, while steadfastly loosening the population's terrified grip on the deadly status quo.
Monday, August 17, 2009
How not to enroll others in your process
My daughter's music school recently sent me a letter stating they were eliminating paper statements and required that we set up an online account. After too much effort and frustration, I now have set up the account. It only took about 10 failed attempts on their website, a trip to their business office, four e-mails, and a 20-minute phone call to finish this task. And my benefit is ... oh yeah, I get to receive electronic statements instead of mailed statements, twice a year. Lucky me.
Now that my gall has (mostly) subsided, I can see where this went off the rails. Whoever directed their process was focused on one outcome (security of student data) to the point of being unmindful of the larger outcome: successful enrollment of customers into their new paperless process. This is an all too-easy mistake. Here are the traps:
1. Not explaining the benefits of enrollment to customers. Academic institutions are not historically customer-focused, even when they are funded by their academic customers. In academia, enrollment just means getting on the class rolls. Customer enrollment requires selling an idea or process to others so that they want to sign up for it. After reading the school's two-page letter, I still didn't really understand why I should care or even participate. I understood that they wanted to eliminate their costs of printing and posting statements, and reduce their delays in receiving payment. But why should I care about that? Not considering the customer's perspective resulted in my starting the process with a grudging attitude. It went downhill from there. This is something to keep top of mind whenever you roll out a process, whether within your company or with your customers. Whatever your project's objectives, when you seek participation from others you have an obligation to enroll them. It isn't enough to direct them, even if they work for you.
2. Not providing all of the information required by the process. Their account set-up process required two pieces of data: an ID and an activation key. I understand they don't want to put both pieces of data in the same piece of mail for security reasons, and the letter contained the activation key. OK - then that's a problem to be solved, which they could have phrased this way: how can we make sure our customers have everything they need before they start the process? Had they sought to enroll customers in the process, this question would have come naturally; since that wasn't their stated outcome, it simply would not have occurred to them. In the end, this customer had to solve the problem: my husband drove to their business office to ask for the ID#. If the school were thinking about the customer's outcomes, they could have solved it easily and saved us a trip and the increasing aggravation. I could have been successful on the first attempt. They'd have me on their side.
3. Providing security keys in a font featuring ambiguous letters. After multiple unsuccessful attempts to validate the activation key, I began e-mailing their support desk. We tried to work out (unsuccessfully, in the end) whether one character was the number 1, the capital letter I, or the lowercase letter L. This issue is unfortunately all too common. Apple's iTunes gift cards suffer from the same issue: I almost never enter the ID codes correctly the first time because the typeface has ambiguous letters. Number 0 or letter O? It's just trial and error, since they have not considered the design of the type face from a usability perspective. I have to believe that for Apple, a company that is extremely design conscious, this is a manifestation of how much (or little) care is given to the customer's experience. I assume someone chose the font because they thought it looked cool. I now have an aversion to buying iTunes gift cards: it's not just the annoyance with having to retype a long random key multiple times; it's the resentment that I'm giving money to a corporation that really doesn't care about how annoying they can be to customers. You don't have to be Apple to make this mistake, and if your stated outcomes don't embrace the customer experience, you're likely to stumble too.
The fact that I dutifully worked through my issues in setting up the music school account will just reinforce with them the 'success' of their project. I have no doubt the project's metrics are aligned with their desired outcomes and not with their customers' experience, and I was aware of this all the way through the dreary experience. I just decided not to sweat it since my desired outcome is that my daughter continues her musical development. The experience just taught me that although I know her teacher also shares this outcome, the school probably does not. I now have an online account with them, but I'm not enrolled.
Now that my gall has (mostly) subsided, I can see where this went off the rails. Whoever directed their process was focused on one outcome (security of student data) to the point of being unmindful of the larger outcome: successful enrollment of customers into their new paperless process. This is an all too-easy mistake. Here are the traps:
1. Not explaining the benefits of enrollment to customers. Academic institutions are not historically customer-focused, even when they are funded by their academic customers. In academia, enrollment just means getting on the class rolls. Customer enrollment requires selling an idea or process to others so that they want to sign up for it. After reading the school's two-page letter, I still didn't really understand why I should care or even participate. I understood that they wanted to eliminate their costs of printing and posting statements, and reduce their delays in receiving payment. But why should I care about that? Not considering the customer's perspective resulted in my starting the process with a grudging attitude. It went downhill from there. This is something to keep top of mind whenever you roll out a process, whether within your company or with your customers. Whatever your project's objectives, when you seek participation from others you have an obligation to enroll them. It isn't enough to direct them, even if they work for you.
2. Not providing all of the information required by the process. Their account set-up process required two pieces of data: an ID and an activation key. I understand they don't want to put both pieces of data in the same piece of mail for security reasons, and the letter contained the activation key. OK - then that's a problem to be solved, which they could have phrased this way: how can we make sure our customers have everything they need before they start the process? Had they sought to enroll customers in the process, this question would have come naturally; since that wasn't their stated outcome, it simply would not have occurred to them. In the end, this customer had to solve the problem: my husband drove to their business office to ask for the ID#. If the school were thinking about the customer's outcomes, they could have solved it easily and saved us a trip and the increasing aggravation. I could have been successful on the first attempt. They'd have me on their side.
3. Providing security keys in a font featuring ambiguous letters. After multiple unsuccessful attempts to validate the activation key, I began e-mailing their support desk. We tried to work out (unsuccessfully, in the end) whether one character was the number 1, the capital letter I, or the lowercase letter L. This issue is unfortunately all too common. Apple's iTunes gift cards suffer from the same issue: I almost never enter the ID codes correctly the first time because the typeface has ambiguous letters. Number 0 or letter O? It's just trial and error, since they have not considered the design of the type face from a usability perspective. I have to believe that for Apple, a company that is extremely design conscious, this is a manifestation of how much (or little) care is given to the customer's experience. I assume someone chose the font because they thought it looked cool. I now have an aversion to buying iTunes gift cards: it's not just the annoyance with having to retype a long random key multiple times; it's the resentment that I'm giving money to a corporation that really doesn't care about how annoying they can be to customers. You don't have to be Apple to make this mistake, and if your stated outcomes don't embrace the customer experience, you're likely to stumble too.
The fact that I dutifully worked through my issues in setting up the music school account will just reinforce with them the 'success' of their project. I have no doubt the project's metrics are aligned with their desired outcomes and not with their customers' experience, and I was aware of this all the way through the dreary experience. I just decided not to sweat it since my desired outcome is that my daughter continues her musical development. The experience just taught me that although I know her teacher also shares this outcome, the school probably does not. I now have an online account with them, but I'm not enrolled.
Monday, August 10, 2009
Just Great Movies - and more
The Traverse City Film Festival (TCFF) this summer was an amazing film-goer experience creatively, intellectually, emotionally. This weekend, as I read through the list of films that won awards at the festival, my appreciation deepened as I realized that my husband and I had seen only a small subset of all the films exhibited. Despite what I felt as a relatively aggressive film-viewing schedule (for someone not in the industry), we had obviously seen a very small pool of the total films, and almost none of those presented with awards. Of the eleven films we saw, only one was average; the remaining ten were each, in its own way, extraordinary and deeply provocative. I have a profound appreciation right now for the many intensely committed, insightful and outrageously imaginative people around the world who make these small films, many of which only find an audience through small film festivals such as TCFF. I need to keep this in mind as pundits criticize the thin gruel that is the fare of the multiplex cinema industry: let's just not call it 'the film industry' but rather 'the corporate multinational film industry.' There is an entire world of film outside the realm of comic book sources, silly chick flicks and crude adolescent male comedy -- all of which patronize and minimize the audience. Most of us just have limited access to this other unenfranchised world. Hence, we are witnessing a rapid rise of small film festivals that are meeting in a limited way a demand that the corporate film industry is unwilling to supply.
If your only film festival experience is from reading accounts in newspapers about Cannes or Sundance, it's important to note a critical difference between those festivals dominated by corporations and the small festivals such as TCFF. Those high-profile festivals are all about big: big names, big cash, big deals, lavish swag and parties. The only things big at TCFF are ideas, choice of films, passion -- you know, all of those things that aren't easily commercialized. Although TCFF does have sponsors who help fund the festival, most if not all of them are small local businesses. Looking at the event as an operation (which, sadly, I cannot prevent myself from doing), its most significant engine is volunteerism. The people responsible for running the festival take leaves of absence from their real jobs and volunteer their time and skills. All of the operations staff are volunteer -- and the size of this temporary work force is staggering. But what is truly amazing is how well they did their jobs, and how committed each of them was to make the experience delightful for every film-goer . Just the logistics of putting together this temporary organization (creating the org charts, hiring, shift scheduling, communication, training, managing resources, problem-solving) is mind-boggling; but additionally they are able to create a culture and mission and enroll every volunteer in it, so that the festival can rely on every part-time volunteer to communicate these behaviorally in every customer interaction. That's not only amazing, it's inspiring.
Think about what it takes in your organization to align hundreds of employees culturally and operationally. Now consider the environment in which this alignment takes place: there's a corporate office, with full time, permanent management. There's company e-mail for communications. The company uses newsletters and meetings held at the employees' workplace, on the employees' work time, to communicate significant messages. The company invests in infrastructure that is permanent and maintained every day of the year. The company has 52 weeks every year to respond to issues and correct them.
The festival does have some advantages not enjoyed by most organizations. The festival only has to get it right for one week - the commitment of its volunteers is passionate but very short-lived, and people can put up with just about anything if they know it will end soon (as I'm reminded with the latest crop of Woodstock anniversary accounts - if it lasted much longer than three days, it might have been disastrous). And, as with the small subset of the films that I saw, similarly I encountered a relatively small number of volunteers, and have no insight into whatever problems the festival organizers and managers handled during the week. But the point is that to this customer, it appeared to be all good, and in my experience this only happens when an organization is getting most things right.
Looking from the outside in, I can only say that I have no idea how this worked operationally. I wish I did. I'm simply inspired.
If your only film festival experience is from reading accounts in newspapers about Cannes or Sundance, it's important to note a critical difference between those festivals dominated by corporations and the small festivals such as TCFF. Those high-profile festivals are all about big: big names, big cash, big deals, lavish swag and parties. The only things big at TCFF are ideas, choice of films, passion -- you know, all of those things that aren't easily commercialized. Although TCFF does have sponsors who help fund the festival, most if not all of them are small local businesses. Looking at the event as an operation (which, sadly, I cannot prevent myself from doing), its most significant engine is volunteerism. The people responsible for running the festival take leaves of absence from their real jobs and volunteer their time and skills. All of the operations staff are volunteer -- and the size of this temporary work force is staggering. But what is truly amazing is how well they did their jobs, and how committed each of them was to make the experience delightful for every film-goer . Just the logistics of putting together this temporary organization (creating the org charts, hiring, shift scheduling, communication, training, managing resources, problem-solving) is mind-boggling; but additionally they are able to create a culture and mission and enroll every volunteer in it, so that the festival can rely on every part-time volunteer to communicate these behaviorally in every customer interaction. That's not only amazing, it's inspiring.
Think about what it takes in your organization to align hundreds of employees culturally and operationally. Now consider the environment in which this alignment takes place: there's a corporate office, with full time, permanent management. There's company e-mail for communications. The company uses newsletters and meetings held at the employees' workplace, on the employees' work time, to communicate significant messages. The company invests in infrastructure that is permanent and maintained every day of the year. The company has 52 weeks every year to respond to issues and correct them.
The festival does have some advantages not enjoyed by most organizations. The festival only has to get it right for one week - the commitment of its volunteers is passionate but very short-lived, and people can put up with just about anything if they know it will end soon (as I'm reminded with the latest crop of Woodstock anniversary accounts - if it lasted much longer than three days, it might have been disastrous). And, as with the small subset of the films that I saw, similarly I encountered a relatively small number of volunteers, and have no insight into whatever problems the festival organizers and managers handled during the week. But the point is that to this customer, it appeared to be all good, and in my experience this only happens when an organization is getting most things right.
Looking from the outside in, I can only say that I have no idea how this worked operationally. I wish I did. I'm simply inspired.
Thursday, July 16, 2009
Enough is enough
Every once in awhile, I'll reach my saturation point with the media. Whether it's business writing or news reportage, the content can become too much of the same and I find I can no longer absorb any more. I reached that point today. One too many articles detailing the sad shape of these times, with too many recycled business axioms. Perhaps we're meant to take comfort in hearing familiar themes, and to feel reassured that we will be just fine if we follow a few simple rules or make a few small changes. Well, I beg to differ. I don't need to be lulled by oft-told tales. Is it nap time?
I think what most businesses and citizens need is quite the opposite: not to be lulled but rather jolted by the urgency of clear analysis and a call to action. In an opinion piece in yesterday's NY Times, Gordon Stewart wrote of the speech President Jimmy Carter gave 30 years ago addressing the urgent need for a forward-thinking energy policy.
Although highly popular with the nation's citizens at the time, the speech was characterized by the media as 'The Malaise Speech' - too much of a downer. Despite the fact that the speech did not contain the word 'malaise,' the word has been associated so closely with this speech that collective memory now insists he used the word. Thirty years later, however, Carter seems amazingly prescient.
We actually had all the facts we needed 30 years ago to know what we had to do: the need for a change in policy was stunningly clear to anyone who waited in those long lines that summer hoping to fill up the family car's gas tank. But more than a policy change was needed. We needed to change. Some sacrifice was necessary: we could not reasonably continue to consume mindlessly without peril. Few could doubt Carter's credibility on factual data, analysis, and his personal integrity: the opinion-makers could therefore not complain that he was dim, didn't have a command of the facts, or that he was lying. Instead, they chose to marginalize his speech and therefore ignore his call to action, based solely on their assertions of how the speech supposedly made people feel. And the country did ignore him, to disastrous consequences, all of which were predictable.
When President Obama took office this year, he repeated the point he had made in his campaign that the country didn't have the luxury of working on only one problem: we have at least five major crises to address simultaneously: Iraq & Afghanistan, the economy, health care, education, the environment. None of these will tolerate incremental improvement: real change is needed that requires radically different policies.
In any business, the same is true on a smaller scale. There is no one thing to fix, and incremental improvement can only end in failure. But to achieve more than incremental gains, you must choose fundamentally to ignore the familiar and embrace the discomfort of challenging assumptions and your own leadership. There's something in the mind that doesn't want to go there, unless the status quo is just too painful to bear.
Here's a thought: Make it new. It will be fun.
I think what most businesses and citizens need is quite the opposite: not to be lulled but rather jolted by the urgency of clear analysis and a call to action. In an opinion piece in yesterday's NY Times, Gordon Stewart wrote of the speech President Jimmy Carter gave 30 years ago addressing the urgent need for a forward-thinking energy policy.
On July 15 — 30 years ago today — at 10 p.m., President Carter and 100 million people finally faced each other across that familiar Oval Office desk. What they saw and heard was unlike any moment they had experienced from their 39th president. Speaking with rare force, with inflections flowing from meanings he felt deeply, Jimmy Carter called for the “most massive peacetime commitment” in our history to develop alternative fuels.
Although highly popular with the nation's citizens at the time, the speech was characterized by the media as 'The Malaise Speech' - too much of a downer. Despite the fact that the speech did not contain the word 'malaise,' the word has been associated so closely with this speech that collective memory now insists he used the word. Thirty years later, however, Carter seems amazingly prescient.
We actually had all the facts we needed 30 years ago to know what we had to do: the need for a change in policy was stunningly clear to anyone who waited in those long lines that summer hoping to fill up the family car's gas tank. But more than a policy change was needed. We needed to change. Some sacrifice was necessary: we could not reasonably continue to consume mindlessly without peril. Few could doubt Carter's credibility on factual data, analysis, and his personal integrity: the opinion-makers could therefore not complain that he was dim, didn't have a command of the facts, or that he was lying. Instead, they chose to marginalize his speech and therefore ignore his call to action, based solely on their assertions of how the speech supposedly made people feel. And the country did ignore him, to disastrous consequences, all of which were predictable.
When President Obama took office this year, he repeated the point he had made in his campaign that the country didn't have the luxury of working on only one problem: we have at least five major crises to address simultaneously: Iraq & Afghanistan, the economy, health care, education, the environment. None of these will tolerate incremental improvement: real change is needed that requires radically different policies.
In any business, the same is true on a smaller scale. There is no one thing to fix, and incremental improvement can only end in failure. But to achieve more than incremental gains, you must choose fundamentally to ignore the familiar and embrace the discomfort of challenging assumptions and your own leadership. There's something in the mind that doesn't want to go there, unless the status quo is just too painful to bear.
Here's a thought: Make it new. It will be fun.
Tuesday, July 7, 2009
Of widgets and patients
Several recent articles about health-care reform have piqued my process improvement interests. In Sunday's NYTimes, Paul O'Neill pointed out the savings to be had in improving the quality of hospital care. This really boils down to a simple lean principle: eliminating rework and waste reduces costs. But, it's somehow more meaningful if you visualize rework looking like patients suffering deadly infections (rather than imagining malformed widgets rolling off the assembly line). In principle they're the same; we just care less about amorphous widgets. So yes, there is opportunity to improve quality and reduce costs, and both would be immensely meaningful particularly in health-care. This can be no surprise to the health-care industry: lots of smart people work in health-care, and their resources dwarf just about every other industry. So why hasn't it happened?
This morning, I was enlightened by Andy Kessler's article today in Technology Review, which explains why "the medical industry has a vested interest in inefficiency." No other industry remains entrenched with paper-based processes, and willfully denies itself the cost-savings and market-expansion potential inherent in capturing process data in real-time and mining that data for intelligence. I find it chilling that I have more real-time production data and analytical reporting on our warehouse picking operations than is available to hospitals about their patient treatments and outcomes. I have, at my fingertips, a complete audit trail of a sofa as it moves through the company and to the consumer. The medical profession cannot track the similar movement of a patient through his or her treatments, even within a single hospital. How can that be? Kessler explains:
What we do follows from the outcomes we seek. Health-care's current targeted outcome is profiting from sickness. If the industry's targeted outcome was health, it could be a robust industry fearless of competition either private or public. This change in objectives would align the industry with its consumers and all of its partners, including the federal government.
Contributing to the fear about oncoming changes to the industry must be the perception of value along the entire channel. The threat of single-payer is essentially no different from the threat of disintermediation which was precipitated in the 90's by the powerful Dell direct-selling model. Experience should have taught us that the close evaluation of a value stream does not necessarily lead to disintermediation; rather, it should force the intermediary players to bring unique value to the channel. In supply chain, this has caused wholesalers and retailers to do more than aggregate product and increase margin, which in turn has resulted in these intermediary players bringing value that the manufacturer cannot provide and for which the consumer is willing to pay. Health-care, feeling threatened, should take note: the marketplace is willing to pay for the value you create and no longer willing to pay you to take profit from our illness.
Update: 24 July 2009- Updated link to Kessler article; the original had elapsed. See TR's July/Aug issue for the article. It's a great magazine and worth picking up.
This morning, I was enlightened by Andy Kessler's article today in Technology Review, which explains why "the medical industry has a vested interest in inefficiency." No other industry remains entrenched with paper-based processes, and willfully denies itself the cost-savings and market-expansion potential inherent in capturing process data in real-time and mining that data for intelligence. I find it chilling that I have more real-time production data and analytical reporting on our warehouse picking operations than is available to hospitals about their patient treatments and outcomes. I have, at my fingertips, a complete audit trail of a sofa as it moves through the company and to the consumer. The medical profession cannot track the similar movement of a patient through his or her treatments, even within a single hospital. How can that be? Kessler explains:
The reason lies neither with cost nor with inadequate technology. Rather, the health-care industry's reluctance to digitize its records is rooted in a desire to keep medicine's lucrative business model hidden. Dangling $19 billion in front of a $2.4 trillion industry is not nearly enough to get it to reveal the financial secrets that electronic health records are likely to uncover--and upon which its huge profits depend. In those medical records lie the ugly truth about the business of medicine: sickness is profitable. The greater the number of treatments, procedures, and hospital stays, the larger the profit. There is little incentive for doctors and hospitals to identify or reduce wasteful spending in medicine.
What we do follows from the outcomes we seek. Health-care's current targeted outcome is profiting from sickness. If the industry's targeted outcome was health, it could be a robust industry fearless of competition either private or public. This change in objectives would align the industry with its consumers and all of its partners, including the federal government.
Contributing to the fear about oncoming changes to the industry must be the perception of value along the entire channel. The threat of single-payer is essentially no different from the threat of disintermediation which was precipitated in the 90's by the powerful Dell direct-selling model. Experience should have taught us that the close evaluation of a value stream does not necessarily lead to disintermediation; rather, it should force the intermediary players to bring unique value to the channel. In supply chain, this has caused wholesalers and retailers to do more than aggregate product and increase margin, which in turn has resulted in these intermediary players bringing value that the manufacturer cannot provide and for which the consumer is willing to pay. Health-care, feeling threatened, should take note: the marketplace is willing to pay for the value you create and no longer willing to pay you to take profit from our illness.
Update: 24 July 2009- Updated link to Kessler article; the original had elapsed. See TR's July/Aug issue for the article. It's a great magazine and worth picking up.
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