Archive for the ‘How To’ Category

Resource Allocation IS Strategy

In business, we have vision statements, mission statements, strategic plans, strategic initiatives, and operating plans. And every day there are there are countless decisions to make. But, in the end, it all comes down to one thing – how we allocate our resources.  Whether it’s hiring people, training them, buying capital, or funding projects, all strategic decisions come back to resource allocation.  Said more strongly, resource allocation is strategy.

Take a look back at last year.  Where did you allocate your capital dollars?  Which teams got it and which did not?  Your capital allocation defined your priorities.  The most important businesses got more capital.  More to the point – the allocated capital defined their importance. Which projects were fully staffed and fully budgeted? Those that were resourced more heavily were more important to your strategy, which is why they were resourced that way. Which businesses hired people and which did not?  The hiring occurred where it fulfilled the strategy. Which teams received most of the training budget?  Those teams were strategically important.  Prioritization in the form of resource allocation.

Repeat the process for this year’s operating plan.  Where is the capital allocated?  Where is the hiring allocated?  Where are the projects fully staffed and budgeted?  Regardless of the mission statements, this year’s strategy is defined by where the resources are allocated.  Full stop.

Repeat the process for your forward-looking strategic plans.  Where are the resources allocated?  Which teams get more?  Which get fewer?  Answer these questions and you’ll have an operational definition of your company’s forward-looking strategy.

To know if the new strategy is different from the old one, look at the budgets.  Do they show a change in resource allocation?  Will old projects stop so new ones can start? Do the new projects serve new customers and new value propositions?  Same old projects, same old customers, same old value propositions, same old strategy.

To determine if there’s a new strategy, look for changes in capital allocation.  If the same teams are allocated more of the same capital, it’s likely the strategy is also the same. Will one team get more capital while the others get less?  Well, it’s likely a new strategy is starting to take shape.

Look for a change in hiring.  Fewer hires like last year and more of a new flavor probably indicate a change in strategy.  And if people flow from one team to another, that’s the same as one team getting new hires and the other team losing them.  That type of change in resource allocation is an indicator of a strategic change.

If the resource allocation differs from the strategic plan, believe the resource allocation. And if the resource allocation is the same as last year, so is the strategy.  And if there is talk of changing resource allocation but no actual change, then there is no change in strategy.

Image credit – Scouse Smurf

How flexible are your processes and how do you know?

What would happen if the factory had to support demand that increased one percent per week? Without incremental investment, how many weeks could they meet the ever-increasing demand?  That number is a measure of the system’s flexibility.  More weeks, more flexibility.  And the element of the manufacturing system that gives out first is the constraint.  So, now you know how much demand you can support before there’s a problem and you know what the problem will be.  And if you know the lead time to implement the improvement needed to support the increased demand, in a reverse-scheduling way, you know when to implement the improvement so it comes online when you need it.

What would happen if the factory had to support demand that increased one percent in a week?  How about two percent in a week, five percent, or ten percent?  Without incremental investment, what percentage increase could they support in a single week?  More percent increase, more flexibility.  And the element of the manufacturing system that gives out first is the constraint.  So, now you know how much increased demand you can support in a single week and you know the gating item that will block further increases.  You know now where to clip the increased demand and push the extra demand into the next week.  And you know the investment it would take to support a larger increase in a single week.

These two scenarios can be used to assess and quantify a process of any type.  For example, to understand the flexibility of the new product development process, load it (virtually) with more projects to see where it breaks.  Make a note of what it would take to increase the system’s flexibility and ask yourself if that’s a good investment.  If it is, make that investment.  If it isn’t, don’t.

This simple testing method is especially useful when the investment needed to increase flexibility has a long lead time or is expensive.  If your testing says the system can support five percent more demand before it breaks and you know that demand will hit the system in ten weeks, I hope the lead time to implement the needed improvement is less than ten weeks.  If not, you won’t be able to meet the increased demand.  And I hope the money to make the improvement is already budgeted because a budgeting cycle is certainly longer than ten weeks and you can’t buy what you need if the money isn’t in the budget.

The first question to ask yourself is what is the minimum flexibility of the system that will trigger the next investment to improve throughput and increase flexibility? And the follow-on question: What is needed to improve throughput? What is the lead time for that solution? How much will it cost? Is the money budgeted? And do we have the resources (people) that can implement the improvement when it’s time?

When the cost of not meeting demand is high, the value of this testing process is high. When the lead times for the improvements are long, this testing process has a lot of value because it gives you time to put the improvements in place.

Continuous improvement of process utilization is also a continuous reduction of process flexibility.  This simple testing approach can help identify when process flexibility is becoming dangerously low and give you the much-needed time to put improvements in place before it’s too late.

Image credit — Tambako The Jaguar

Why is it so difficult to get ready?

The time to start getting ready is before we need to be.

We don’t get ready because the problem hasn’t yet kicked us in the head.  It has only started getting ready to do so.

We don’t get ready because we don’t see the early warning signs.  Like the meteorologist who doesn’t make time to look at the radar and satellite images, if we don’t look, we can’t see.  And if we’re really busy, we don’t make time to look.  What if it was part of our job to look at the satellite images? Who in our company should have that job?

We don’t get ready because we don’t heed the early warning signs. Seeing the warning signs is much different than justifying the reallocation of resources because someone says the tea leaves suggest an impending problem.

We will solve no problem until it’s too late to do anything else.

We don’t get ready because we forget that it takes time to get ready.  We do so little getting ready, we’re unfamiliar with the work content and timeline of getting ready.  We forget that getting ready is on the critical path of problem-solving.

We don’t get ready because everyone is fully booked and we have no excess capacity to allocate to getting ready.  And by the time we free up the resources to get ready (if we can do that at all), we miss the window of opportunity to get ready.

We will solve a problem only after exhausting all other possibilities.

We don’t get ready because the problem is someone else’s.  If we don’t have capacity to get ourselves ready for our problems why would we allocate the capacity to get ready for someone else’s?

We don’t get ready because we try to give our problem to someone else.  Isn’t it easier to convince someone else to get ready than to do the getting ready ourselves?

We will solve no problem until we know we’ll get the credit.

We don’t get ready because problem avoidance won’t get us promoted, though putting out a fire that could have been avoided will.

If a problem is avoided, there is no problem. And since there’s no problem, there’s no need to avoid it.

We don’t get ready because there’s no certainty a problem will be a problem until we have it.  And we can’t get ready to solve a problem once we have it.  Getting ready requires judgment and trust – judgment by the person who sees the early warning signs and trust by the person who allocates the resources.  It’s that simple.

Because we’ve conditioned people to be afraid to use their judgment, they don’t use it.  And because we’ve conditioned people to be afraid to spend the time needed to build trust, they don’t build it.

Now that we have these two problems, how can we make it safe for people to use their judgment and spend the time needed to develop trust?

Image credit — Leonard J Matthews

Getting Out of the Way

If something’s in the way, call it by name and move it out of the way.

If that something is a technical problem, figure out what’s blocking the solution and move it out of the way.

If that something is a person, try to understand what’s motivating their blocking action.  Don’t call their behavior a “blocking action” but try to understand what’s behind their behavior.  Help them understand what they are putting in the way and why they might be behaving as they are.  And once you both understand their behavior, help them see how their behavior is negatively impacting them.  Usually, that’s enough to break the impasse.

If that something that’s in the way is you, pretend you’re someone else and do the same thing.  Have a conversation with yourself.  Ask yourself what motivates the blocking behavior and then listen.  Believe it or not, if you calm your mind and body, you will hear a reply to your question and learn what’s behind the blocking behavior. If it’s fear of failure, a quiet voice will tell you it doesn’t want to feel the emotional pain or the judgment around failure. If it’s fear of success, a different voice will tell you it doesn’t believe it’s worthy of success or doesn’t think highly enough of itself to give things a try.  If it’s fear of confrontation, a part of you will tell you it’s not confident and it doesn’t want to be judged negatively.  Next, it’s time to fight the aversion to uncomfortable thoughts and get curious.

Feel the discomfort around the fear of failure in your body.  Don’t judge it negatively, just feel it. And get curious about the reason behind the fear of failure.  If you listen, it will likely tell you the reason for the discomfort.  Ask it what it’s afraid would happen if it moved that reason out of the way. Usually, there’s a realization that nothing bad would happen if the blocking action was unblocked and it can be moved out of the way.

Whether it’s the fear of success or the fear of confrontation, the process is the same.  Feel the sensations in your body (without judging) and get curious.  Ask the voice what it’s afraid would happen if it stopped putting something in the way.  And if you can refrain from judgment, the voice will tell you what needs to be moved out of the way so progress can be made.

The process I describe above is based on Internal Family Systems (IFS).  I have found it useful to understand the rationale behind my behavior and help myself make progress.

I hope you find it useful.

Image credit — Joachim Dobler

Time is not coming back.

How do you spend your time?

How much time do you spend on things you want to do?

How much time do you spend on things you don’t want to do?

How much time do you have left to change that?

If you’re spending time on things you don’t like, maybe it’s because you don’t have any better options.  Sometimes life is like that.

But maybe there’s another reason you’re spending time on things you don’t like.

If you’re afraid to work on things you like, create the smallest possible project and try it in private.

If that doesn’t work, try a smaller project.

If you don’t know the ins and outs of the thing you like, give it a try on a small scale.  Learn through trying.

If you don’t have a lot of money to do the thing you like, define the narrowest slice and give it a go.

If you could stop on one thing so you could start another, what are those two things?  Write them down.

And start small. And start now.

Image credit — Pablo Monteagudo

The Friendship Framework

When your friend is having a bad time of it, you don’t criticize, you empathize.

When you think of your friend, you check in.

When your friend is happy, you are happy with them.

When your friend is lonely, you don’t ignore, you are right there with them.

When your friend is struggling, you check in more frequently.

When your friend is in a rut, you jump in with them and give them what you can.

When your friend makes a mistake, you don’t judge, you seek to understand.

When your friend achieves their goal, you celebrate with them.

When your friend is angry, you ask of their heart’s best intention.

When your friend is confused, you tell them they seem confused and ask what’s going on.

When your friend judges themself, you tell them they are worthy of better treatment.

It’s easy to treat our friends well because we care about them.

May we learn to see ourselves as friends and make it easier to care for ourselves and treat ourselves well.

Image credit — Fuschia Foot

Working In Domains of High Uncertainty

X: When will you be done with the project?

Me: This work has never been done before, so I don’t know.

 

X: But the Leadership Team just asked me when the project will be done. So, what should I say?

Me: Since nothing has changed since the last time you asked me, I still don’t know. Tell them I don’t know.

 

X: They won’t like that answer.

Me: They may not like the answer, but it’s the truth.  And I like telling the truth.

 

X: Well, what are the steps you’ll take to complete the project?

Me: All I can tell you is what we’re trying to learn right now.

 

X: So all you can tell me is the work you’re doing right now?

Me: Yes.

 

X: It seems like you don’t know what you’re doing.

Me: I know what we’re doing right now.

 

X: But you don’t know what’s next?

Me: How could I?  If this current experiment goes up in smoke, the next thing we’ll do is start a different project.  And if the experiment works, we’ll do the next right thing.

 

X: So the project could end tomorrow?

Me: That’s right.

 

X: Or it could go on for a long time?

Me: That’s right too.

 

X: Are you always like this?

Me: Yes, I am always truthful.

 

X: I don’t like your answers. Maybe we should find someone else to run the project.

Me: That’s up to you.  But if the new person tells you they know when the project will be done, they’re the wrong person to run the project.  Any date they give you will be a guess.  And I would not want to be the one to deliver a date like that to the Leadership Team.

 

X: We planned for the project to be done by the end of the year with incremental revenue starting in the first quarter of next year.

Me: Well, the project work is not bound by the revenue plan.  It’s the other way around.

 

X: So, you don’t care about the profitability of the company?

Me: Of course I care.  That’s why we chose this project – to provide novel customer value and sell more products.

 

X: So the project is intended to deliver new value to our customers?

Me: Yes, that’s how the project was justified.  We started with an important problem that, if solved, would make them more profitable.

 

X: So you’re not just playing around in the lab.

Me: No, we’re trying to solve a customer problem as fast as we can.  It only looks like we’re playing around.

 

X: If it works, would our company be more profitable?

Me: Absolutely.

 

X: Well, how can I help?

Me: Please meet with the Leadership Team and thank them for trusting us with this important project.  And tell them we’re working as fast as we can.

Image credit – Florida Fish and Wildlife

X:  Me:  format stolen from Simon Wardley (@swardley).  Thank you, Simon.

Happier and More Thankful

What could we change to become happier? 

Happiness comes when our reality (how things really are) compares favorably with our expectations. If happiness comes from the comparison between how things are and our expectations, wouldn’t we be happier with any outcome if we change our expectations of the outcome? But how are expectations defined? What makes an expectation an expectation?  Where do our expectations come from?

If we expect to have no control over the outcome, wouldn’t we be happier with any outcome?  Aren’t we the ones who set our expectations? And hasn’t the Universe told us multiple times we don’t have control? If so, what’s in the way of giving up our expectations of control? What’s in the way of letting go?

What could we change to become more thankful?

Thankfulness comes when our reality, what we see or recognize, compares favorably with how we think things should be. If thankfulness comes from the comparison between what is and what should be, what if we changed our shoulds?  Wouldn’t we be more thankful if we lessened our shoulds and reality compared more favorably? But how are shoulds defined?  What makes a should a should? Where do our shoulds come from?

If we can help ourselves believe we don’t have control over how things should be, wouldn’t we be more thankful for how things are? And aren’t we the setters of our shoulds? And hasn’t the Universe often told us our shoulds have no control over it? If so, what’s in the way of giving up the belief that our shoulds have control over anything? What’s in the way of letting go?

Shoulds and expectations are close cousins and both influence our happiness and ability to be thankful.

At this Thanksgiving holiday, may we be aware of our shoulds and enjoy our friends and family as they are. May we be aware of our expectations and enjoy the venue, the food, the weather, and the conversations as they are. May we suspend our natural desire to control things and be happy and thankful for things as they are.

And may we love ourselves as we are.

Happy Thanksgiving.

Mike

 

Image credit — Bennilover

How People Grow

I was invited to an important meeting.  Here’s how it went.

I was invited to an important meeting.  I want you to attend with me.

I was invited to an important meeting with my boss.  Will you join me?

I was invited to an important meeting but I cannot attend.  Will you go in my place?

I was invited to an important meeting but the company will be better served if you attend.

I heard you were invited to the meeting instead of me.  I think that’s great.

Here’s a presentation I put together.  I want to explain it to you.

Here’s a presentation I put together.  What does it say to you?

Here’s a presentation I put together.  What’s missing?

I want you to create a draft of a presentation which we’ll review together.

I want you to create the presentation.  I’ll review it if you want.

I want you to create the presentation and deliver it.

I heard you helped someone create an interesting presentation and it went over well.  I’m happy you did that.

This is the situation and this is what I want you to do.

This is the situation and this is what I think we should do.  What do you think?

This is the situation. What do you think we should do?

This is the situation.  What are you going to do?

What’s the situation?

What’s the situation and what will you do?

What was the situation and what did you do?

I heard you helped someone with their situation.  That made me smile.

Image credit — Bastian_Schmidt

There is always something to build on.

To have something is better than to have nothing, and to focus on everything dilutes progress and leads to nothing. In that way, something can be better than everything.

What do you have and how might you put it to good use right now?

Everything has a history. What worked last time? What did not? What has changed?

What information do you have that you can use right now? And what’s the first bit of new information you need and what can you to do get it right now?

It is always a brown-field site and never a green-field.  You never start from scratch.

What do you have that you can build on right now? How might you use it to springboard into the future?

When it’s time to make a decision, there is always some knowledge about the current situation but the knowledge is always incomplete.

What knowledge do you have right now and how might you use it to advance the cause? What’s the next bit of knowledge you need and why aren’t you trying to acquire that knowledge right now?

You always have your intuition and your best judgment.  Those are both real things. They’re not nothing.

How can you use your intuition to make progress right now? How can you use your judgment to advance things right here and right now?

There’s a singular recipe in all this.

Look for what you have (and you always have something) and build on it right now.  Then look again and repeat.

Image credit – Jeffrey

The People Part of the Business

Whatever business you’re in, you’re in the people business.

Scan your organization for single-point failure modes, where if one person leaves the wheels would fall off.  For the single-point failure mode, move a new person into the role and have the replaced person teach their replacement how to do the job.  Transfer the knowledge before the knowledge walks out the door.

Scan your organization for people who you think can grow into a role at least two levels above their existing level.  Move them up one level now, sooner than they and the organization think they’re ready.  And support them with a trio of senior leaders.  Error on the side of moving up too few people and providing too many supporting resources.

Scan your organization for people who exert tight control on their team and horde all the sizzle for themselves.  Help these people work for a different company. Don’t wait. Do it now or your best young talent will suffocate and leave the company.

Scan your organization for people who are in positions that don’t fit them and move them to a position that does.  They will blossom and others will see it, which will make it safer and easier for others to move to positions that fit them.  Soon enough, almost everyone will have something that fits them.  And remember, sometimes the position that fits them is with another company.

Scan your organization for the people who work in the background to make things happen. You know who I’m talking about.  They’re the people who create the conditions for the right decisions to emerge, who find the young talent and develop them through the normal course of work, who know how to move the right resources to the important projects without the formal authority to do so, who bring the bad news to the powerful so the worthy but struggling projects get additional attention and the unworthy projects get stopped in their tracks, who bring new practices to new situations but do it through others, who provide air cover so the most talented people can do the work everyone else is afraid to try, who overtly use their judgment so others can learn how to use theirs, and who do the right work the right way even when it comes at their own expense.  Leave these people alone.

When you take care of the people part of the business, all the other parts will take care of themselves.

Image credit – are you my rik?

Mike Shipulski Mike Shipulski
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