Experiment With Your People Systems

Battle_of_Waterloo_1815It’s pretty clear that innovation is the way to go. There’s endless creation of new technologies, new materials, and new processes so innovation can create new things to sell. And there are multiple toolsets and philosophies to get it done, but it’s difficult.

When doing new there’s no experience, no predictions, no certainty. But innovation is no dummy and has come up with a way to overcome the uncertainty. It builds knowledge of systems through testing – build it, test it, measure it, fix it. Not easy, but doable. And what makes it all possible is the repeatable response of things like steel, motors, pumps, software, hard drives. Push on them repeatably and their response is repeatable; stress them in a predictable way and their response is predictable; break them in a controlled way and the failure mode can be exercised.

Once there’s a coherent hypothesis that has the potential to make magic, innovation builds it in the lab, creates a measurement system to evaluate goodness, and tests it. After the good idea, innovation is about converting the idea into a hypothesis – a prediction of what will happen and why – and testing them early and often. And once they work every-day-all-day and make into production, the factory measures them relentlessly to make sure the goodness is shipped with every unit, and the data is religiously plotted with control charts.

The next evolution of innovation will come from systematically improving people systems. There are some roadblocks but they can be overcome. In reality, they already have been overcome it’s just that no one realizes it.

People systems are more difficult because their responses are not repeatable – where steel bends repeatably for a given stress, people do not. Give a last minute deliverable to someone in a good mood, and the work gets done; give that same deliverable to the same person on a bad day, and you get a lot of yelling. And because bad moods beget bad moods, people modify each other’s behavior. And when that non-repeatable, one-person-modifying-another response scales up to the team level, business unit, company, and supply chain, you have a complex adaptive system – a system that cannot be predicted. But just as innovation of airliners and automobiles uses testing to build knowledge out of uncertainty, testing can do the same for people systems.

To start, assumptions about how people systems would respond to new input must be hardened into formal hypotheses. And for the killer hypotheses that hang together, an experiment is defined; a small target population is identified; a measurement system created; a baseline measurement is taken; and the experiment is run. Data is then collected, statistical analyses are made, and it’s clear if the hypothesis is validated or not. If validated, the solution is rolled out and the people system is improved. And in a control chart sense, the measurement system is transferred to the whole system and is left to run continuously to make sure the goodness doesn’t go away. If it’s invalidated, another hypothesis is generated and the process is repeated. (It’s actually better to test multiple hypotheses in parallel.)

In the past, this approach was impossible because the measurement system did not exist. What was needed was a simple, mobile data acquisition system for “people data”, a method to automatically index the data, and a method to quickly process and display the results. The experimental methods were clear, but there was no response for the experiments. Now there is.

People systems are governed by what people think and feel, and the stories they tell are the surrogates for their thoughts and feelings. When an experiment is conducted on a people system, the stories are the “people data” that is collected, quantified, and analyzed. The stories are the response to the experiment.

It is now possible to run an experiment where a sample population uses a smart phone and an app to collect stories (text, voice, pictures), index them, and automatically send them to a server where some software groups the stories and displays them in a way to see patterns (groups of commonly indexed stories). All this is done in real time. And, by clicking on a data point, the program brings up the story associated with that data point.

Here’s how it works. The app is loaded, people tell their stories on their phone, and a baseline is established (a baseline story pattern). Inputs or constraints are changed for the target population and new stories are collected. If the patterns change in a desirable way (statistical analysis is possible), the new inputs and constraints are rolled out. If the stories change in an undesirable way, the target population reverts back to standard conditions and the next hypothesis is tested.

Unbiased, real time, continuous information streams to make sense of your people systems is now possible. Real time, direct connection to your employees and your customers is a reality, and the implications are staggering.

Thank you Dave Snowden.

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Put Yourself Out There

Its all goodPut yourself out there. Let it hang out. Give it a try. Just do it. The reality is few do it, and fewer do it often. But why?

In a word, fear. But it cuts much deeper than a word. Here’s a top down progression:

What will they think of your idea? If you summon the courage to say it out loud, your fear is they won’t like it, or they’ll think it’s stupid. But it goes deeper.

What with they think of you? If they think your idea is stupid, your fear is they’ll think you’re stupid. But so what?

How will it conflict with what you think of you? If they think you’re stupid, your fear is it will conflict with what you think of you. Now we’re on to it – full circle.

What do you think of you? It all comes down to your self-image – what you think is it and how you think it will stand up against the outside forces trying to pull it apart. The key is “what you think” and “how you think”. Like all cases, perception is reality; and when it comes to judging ourselves, we judge far too harshly. Our severe self-criticism deflates us far below the waterline of reality, and we see ourselves far shallower than our actions decree.

You’re stronger and more capable than you let yourself think. But no words can help with that; for that, only action will do. Summon the courage to act and take action. Just do it. And to calm yourself before you jump, hold onto this one fact – others’ criticism has never killed anyone. Stung, yes. Killed, no. Plain and simple, you won’t die if you put yourself out there. And even the worst bee stings subside with a little ice.

I’m not sure why we’re so willing to abdicate responsibility for what we think of ourselves, but we do. So where you may have abdicated responsibility in the past, in the now it’s time to take responsibility. It’s time to take responsibility and act on your own behalf.

Fear is real, and you should acknowledge it. But also acknowledge you give fear its power. Feel the fear, be afraid. But don’t succumb to the power you give it.

Put yourself out there. Do it tomorrow. You won’t die. And I bet you’ll surprise others.

But I’m sure you’ll surprise yourself more.

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The Complexity Conundrum

ConfusedIn school the problems you were given weren’t really problems at all. In school you opened the book to a specific page and there, right before you in paragraph form and numbered consecutively, was a neat row of “problems”. They were fully-defined, with known inputs, a formal equation that defined the system’s response, and one right answer. Nothing extra, nothing missing, nothing contradictory. Today’s problems are nothing like that.

Today’s problems don’t have a closed form solution; today’s problems don’t have a right answer. Three important factors come into play: companies and their systems are complex; the work, at some level, is always new; and people are always part of the equation.

It’s not that companies have a lot of moving parts (that makes them complicated); it’s that the parts can respond differently in different situations, can change over time (learn), and the parts can interact and change each others’ response (that’s complex). When you’re doing work you did last time, there’s a pretty good chance the system will perform like it did last time. But it’s a different story when the inputs are different, when the work is new.

When the work is new, there’s no precedent. The inputs are new and the response is newer. Perturb the system in a new way and you’re not sure how it will respond. New interactions between preciously unreactive parts make for exciting times. The seemingly unconnected parts ping each other through the ether, stiffen or slacken, and do their thing in a whole new way. Repeatability is out the window, and causal predictability is out of the question. New inputs (new work) slathers on layers of unknownness that must be handled differently.

Now for the real complexity culprit – people. Companies are nothing more than people systems in the shape of a company. And the work, well, that’s done by people. And people are well known to be complex. In a bad mood, we respond one way; confident and secure we respond in another. And people have memory. If something bad happened last time, next time we respond differently. And interactions among people are super complex – group think, seniority, trust, and social media.

Our problems swim with us in a hierarchical sea of complexity. That’s just how it is. Keep that in mind next time you put together your Gantt chart and next time you’re asked to guarantee the outcome of an innovation project.

Complexity is real, and there are real ways to handle it. But that’s for another time. Until then, I suggest you bone up on Dave Snowden’s work. When it comes to complexity, he’s the real deal.

Image credit – miguelb.

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The Illusion of Planning

Pin The Tail on the Donkey

Planning is important work, but it’s non-value added work. Short and sweet – planning is waste.

Lean has taught us waste should be reduced, and the best way to reduce waste from planning is to spend less time planning. (I feel silly writing that.) Lean has taught us to reduce batch size, and the best way to reduce massive batch size of the annual planning marathon is to break it into smaller sessions. (I feel silly writing that too.)

Unreasonable time constraints increase creativity. To create next year’s plan, allocate just one for the whole thing. (Use a countdown timer.) And, because batch size must be reduced, repeat the process monthly. Twelve hours of the most productive planning ever, and countless planning hours converted into value added work.

Defining the future state and closing the gap is not the way to go. The way to go is to define the current state (where you are today) and define how to move forward. Use these two simple rules to guide you:

  • Do more of what worked.
  • Do less of what didn’t.

Here’s an example process:

The constraint – no new hires. (It’s most likely the case, so start there.)

Make a list of all the projects you’re working on. Decide which to stop right now (the STOP projects) and which you’ll finish by the end of the month (the COMPLETED projects). The remaining projects are the CONTINUE projects, and, since they’re aptly named, you should continue them next month. Then, count the number of STOP and COMPLETED projects – that’s the number of START projects you can start next month.

If the sum of STOP and COMPLETED is zero, ask if you can hire anyone this month. If the answer is no, see you next month.

If the sum is one, figure out what worked well, figure out how to build on it, and define the START project. Resources for the START project should be the same as the STOP or COMPLETED project.

If the sum is two, repeat.

Now ask if you can hire anyone this month. If the answer is no, you’re done. If the answer is yes, define how many you can hire.

With your number in hand, and building on what worked well, figure out the right START project. Resources must be limited by the number of new hires, and the project can’t start until the new hire is hired. (I feel silly writing that, but it must be written.) Or, if a START project can’t be started, use the new resource to pile on to an important CONTINUE project.

You’re done for the month, so send your updated plan to your boss and get back to work.

Next month, repeat.

The process will evolve nicely since you’ll refine it twelve times per year.

Ultimately, planning comes down to using your judgment to choose the next project based on the resources you’re given. The annual planning process is truly that simple, it’s just doesn’t look that way because it’s spread over so many months. So, if the company tells its leaders how many resources they have, and trusts them to use good judgment, yearly planning can be accomplished in twelve hours per year (literally). And since the plan is updated monthly, there’s no opportunity for emergency re-planning, and it will always be in line with reality.

Less waste and improved quality – isn’t that what lean taught us?

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A Viral Infection Of Alignment And Consensus

VirusAlignment is all the rage. The thinking goes: If we’re all pulling in the same direction, we’ll get their faster. There’s truth to that – the boat does go faster with more oars and more backs pulling on them. And as long as the boat’s heading in the right direction, alignment holds water. But here’s the dark side – while we’re all pulling on our own oar, we’re all sitting in the same boat. And when the boat is scuttled by a fast moving storm, we all go down together – in alignment.

Alignment, overdone, is not resilient. One longboat lost at sea doesn’t spell the end of for the clan, unless there’s only one boat. With the remaining boats, the Jarl can continue with trading neighboring clans while the shipwrights turn oaks into a beautiful replacement. Certainly a setback, but the Vikings survived. But more than survival, it’s also an opportunity for the shipwrights to try a new technology and make the new longboat faster than the old one.

Consensus isn’t the same as alignment, it but it too is in fashion and it too has a dark underbelly. Yes, it creates convergence on a go-forward plan, and, yes, everyone knows the plan and is good with it. But consensus dulls to the lowest common denominator and creates middle-of-the-of-the-road plans devoid of edge, sizzle, and excitement. Consensus reduces diversity of thinking, and, therefore, reduces resilience.

Consensus, unbridled, reduces thinking to a single strain which can be completely wiped out by an unforeseen antibiotic of change. But with consensus in check, many strains of thinking swim about the organization and no one environmental factor can wipe them out. When protected from consensus, diversity of thinking spawns parallel competing mindsets which improve corporate survivability.

Businesses are too complex to predict all possible bacterial and viral attacks. And even if you could, there are just too many too many of them. It’s far too costly for an organization to be robust to all possibilities.

It’s time to acknowledge knowable threats will find you at unpredictable times. And it’s time to evolve into a resilient organization.

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How Things Really Happen

The conductor behind it all.

From the outside it’s unclear how things happen; but from the inside it’s clear as day. No, it’s not your bulletproof processes; it’s not your top down strategy; and it’s not your operating plans. It’s your people.

At some level everything happens like this:

An idea comes to you that makes little sense, so you drop it. But it comes again, and then again. It visits regularly over the months and each time reveals a bit of its true self. But still, it’s incomplete. So you walk around with it and it eats at you; like a parasite, it gets stronger at your expense. Then, it matures and grows its voice – and it talks to you. It talks all the time; it won’t let you sleep; it pollutes you; it gets in the way; it colors you; and finally you become the human embodiment of the idea.

And then it tips you. With one last push, it creates enough discomfort to roll over the fear of acknowledging its existence, and you set up the meeting.

You call the band and let them know it’s time again to tour. You’ve been through it before and you all know deal. You know your instruments and you know how to harmonize. You know what they can do (because they’ve done it before) and you trust them. You sing them the song of your idea and they listen. Then you ask them to improvise and sing it back, and you listen. The mutual listening moves the idea forward, and you agree to take a run at it.

You ask how it should go. The lead vocalist tells you how it should be sung; the lead guitar works out the fingering; the drummer beats out the rhythm; and the keyboardist grins and says this will be fun. You all know the sheet music and you head back to your silos to make it happen.
In record time, the work gets done and you get back together to review the results. As a group you decide if the track is good enough play in public. If it is, you set up the meeting with a broader audience to let them hear your new music. If it’s not, you head back to the recording studio to amplify what worked and dampen what didn’t. You keep re-recording until your symphony is ready for the critics.

Things happen because artists who want to make a difference band together and make a difference. With no complicated Gantt chart, no master plan, no request for approval, and no additional resources, they make beautiful music where there had been none. As if from thin air, they create something from nothing. But it’s not from thin air; it’s from passion, dedication, trust, and mutual respect.

The business books over-complicate it. Things happen because people make them happen – it’s that simple.

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The Ladder Of Your Own Making

Your LadderThere’s a natural hierarchy to work.  Your job, if you choose to accept it is to climb the ladder of hierarchy rung-by-rung. Here’s how to go about it:

Level 1. Work you can say no to – Say no to it. Say no effectively as you can, but say it. Saying no to level 1 work frees you up for the higher levels.

Level 2. Work you can get someone else to do – Get someone else to do it. Give the work to someone who considers the work a good reach, or a growth opportunity. This isn’t about shirking responsibility, it’s about growing young talent. Maybe you can spend a little time mentoring and the freed up time doing higher level work. Make sure you give away the credit so next time others will ask you for the opportunity to do this type of work for you.

Level 3. Work you’ve done before, but can’t wiggle out of – Do it with flair, style, and efficiency; do it differently than last time, then run away before someone asks you to do it again. Or, do it badly so next time they ask someone else to do it. Depending on the circumstance, either way can work.

Level 4. Work you haven’t done before, but can’t wiggle out of – Come up with a new recipe for this type of work, and do it so well it’s unassailable. This time your contribution is the recipe; next time your contribution is to teach it to someone else. (See level 2.)

Level 5. Work that scares others – Figure out why it scares them; break it into small bites; and take the smallest first bite (so others can’t see the failure).  If it works, take a bigger bite; if it doesn’t, take a different smallest bite.  Repeat, as needed. Next time, since you’ve done it before, treat it like level 3 work. Better still, treat it like level 2.

Level 6. Work that scares you – Figure out why it scares you, then follow the steps for level 5.

Level 7. Work no one knows to ask you to do – You know your subject matter better than anyone, so figure out the right work and give it a try.  This flavor is difficult because it comes at the expense of work you’re already signed up to do and no one is asking you to do it. But you should have the time because you followed the guidance in the previous levels.

Level 8. Work that obsoletes the very thing that made your company successful – This is rarified air – no place for the novice. Ultimately, someone will do this work, and it might as well be you.  At least you’ll be able to manage the disruption on your own terms.

In the end, your task, if you choose to accept it, is to migrate toward the work that obsoletes yourself. For only then can you start back at level 1 on the ladder of your own making.

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The Power Of Pizza

Making Powerful Pizza

When you want to recognize people for their wonderful work, dollar-for-dollar, the best value on the planet is pizza.

Research shows monetary rewards aren’t all that rewarding, and the thinking carries with pizza – you can buy bargain brand, wood-fired, free-range, vegan, or designer, the power of pizza is independent of pedigree. The power of pizza is about the forethought and intention to make the celebration happen. You must realize that people made the extra effort; you must decide you want to tell them you appreciate their work; you must figure out the leaders of the folks that did the work so you can let them know their people did a great job and that you’re buying them pizza; you must schedule the venue (the venue doesn’t actually matter); send out the invitation; order the pizza; and host the celebration.   With pizza, you spend your time on behalf of their behavior, and that’s special.

Here are the rules of pizza:

Rule 1 – Buy 50% more pizza than is reasonable.  They didn’t skimp on their effort, so don’t skimp on the pizza.  When you buy extra pizza, you tell people they matter; you tell them they’re worth it; you tell them that no one will go hungry on your watch.  One good outcome – they take the extra pizza back to the office, their coworkers smell it, and ask where they got it.  Now, they get to tell the story of how, out of the blue, they were invited to a pizza party to recognize their excellent performance.  But the best possible outcome is the extra pizza is taken home and given to the kids. The kids get pizza, and the proud parent gets to tell the story of their special lunch.  Leftover pizza has real power.

Rule 2 – Buy a small salad.  For those that want to celebrate yet watch their waste line, salad says you thought of them.  But don’t buy a big salad because even the most vigilant salad-eaters celebrate with pizza. (See rule 1.)

Rule 3 – There is a natural hierarchy of drinks, and higher is better.  At the top are beer and wine (no need to explain); next is fully caffeinated, full calorie soda; next is diet soda; next is flavored seltzer (it’s the bubbles that matter).  If you’re considering anything less than seltzer, don’t.

Rule 4 – Keep the agenda simple.  Here’s a good template: 1. Thank you for your amazing work.  2. What kind of pizza do you want?

Rule 5 – Use pizza sparingly. It’s power is inversely proportional to frequency.

People don’t want compensation for their extra special work, they want recognition.  And pizza could be the purest form of recognition – simple, straightforward, and tangible.

In reality, pizza has nothing to do with pizza, and has everything to do with honest, heartfelt recognition of exceptional work.

Image credit – Jeff Kubina.

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Summoning The Courage To Ask

Alone in the line.

I’ve had some great teachers in my life, and I’m grateful for them.  They taught me their hard-earned secrets, their simple secrets.  Though each had their own special gifts, they all gave them in the same way – they asked the simplest questions.

Today’s world is complex – everything interacts with everything else; and today’s pace is blistering – it’s tough to make time to understand what’s really going on.  To battle the complexity and pace, force yourself to come up with the simplest questions.  Here are some of my favorites:

 

For new products:

  • Who will buy it?
  • What must it do?
  • What should it cost?

 

For new technologies:

  • What problem are you trying to solve?
  • How will you know you solved it?
  • What work hasn’t been done before?

 

For new business models:

  • Why are you holding onto your decrepit business model?

 

For problems:

  • Can you draw a picture of it on one page?
  • Can you make it come and go?

 

For decisions:

  • What is the minimum viable test?
  • Why not test three or four options at the same time?

 

For people issues:

  • Are you okay?
  • How can I help you?

 

For most any situation:

  • Why?

 

These questions are powerful because they cut through the noise, but their power couples them to fear and embarrassment – fear that if you ask you’ll embarrass someone.  These questions have the power to make it clear that all the activity and hype is nothing more than a big cloud of dust heading off in the wrong direction. And because of that, it’s scary to ask these questions.

It doesn’t matter if you steal these questions directly (you have my permission), twist them to make them your own, or come up with new ones altogether.  What matters is you spend the time to make them simple and you summon the courage to ask.

Image credit — Montecruz Foto.

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Can It Grow?

Retired SunflowerIf you’re working in a company you like, and you want it to be around in the future, you want to know if it will grow.  If you’re looking to move to a new company, you want to know if it has legs – you want to know if it will grow. If you own stock, you want to know if the company will grow, and it’s the same if you want to buy stock.  And it’s certainly the case if you want to buy the whole company – if it can grow, it’s worth more.

To grow, a company has to differentiate itself from its competitors.  In the past, continuous improvement (CI) was a differentiator, but today CI is the minimum expectation, the cost of doing business.  The differentiator for growth is discontinuous improvement (DI).

With DI, there’s an unhealthy fascination with idea generation.  While idea generation is important, companies aren’t short on ideas, they’re short on execution.  But the one DI differentiator is the flavor of the ideas.  To do DI a company needs ideas that are radically different than the ones they’re selling now.  If the ideas are slightly twisted variants of today’s products and business models, that’s a sure sign continuous improvement has infiltrated and polluted the growth engine. The gears of the DI engine are gummed up and there’s no way the company can sustain growth.  For objective evidence the company has the chops to generate the right ideas, look for a process that forces their thinking from the familiar, something like Jeffrey Baumgartner’s Anticonventional Thinking (ACT).

For DI-driven growth, the ability to execute is most important.  With execution, the first differentiator is how the company investigates radically new ideas.  There are three differentiators – a focus on speed, a “market first” approach, and the use of minimum viable tests (MVTs).  With new ideas, it’s all about how fast you can learn, so speed should come through loud and clear.  Without a market, the best idea is worthless, so look for “market first” thinking.  Idea evaluation starts with a hypothesis that a specific market exists (the market is clearly defined in the hypothesis) which is evaluated with a minimum viable test (MVT) to prove or disprove the market’s existence.  MVTs should error on the side of speed – small, localized testing.  The more familiar minimum viable product (MVP) is often an important part of the market evaluation work.  It’s all about learning about the market as fast as possible.

Now, with a validated market, the differentiator is how fast company can rally around the radically new idea and start the technology and product work.  The companies that can’t execute slot the new project at the end of their queue and get to it when they get to it.  The ones that can execute stop an existing (lower value) project and start the new project yesterday.  This stop-to-start behavior is a huge differentiator.

The company’s that can’t execute take a ready-fire-aim approach – they just start.  The companies that differentiate themselves use systems thinking to identify gaps in resources and capabilities and close them. They do the tough work of prioritizing one project over another and fully staff the important ones at the expense of the lesser projects.  Rather than starting three projects and finishing none, the companies that know how to do DI start one, finish one, and repeat.  They know with DI, there’s no partial credit for a project that’s half done.

All companies have growth plans, and at the highest level they all hang together, but some growth plans are better than others.  To judge the goodness of the growth plan takes a deeper look, a look into the work itself.  And once you know about the work, the real differentiator is whether the company has the chops to execute it.

Image credit – John Leach.

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The Safest Bet Is Far Too Risky

Playing It SafeIt’s harder than ever to innovate, and getting harder.

The focus on growth can be empowering, but when coupled with signed-in-blood accountability, empowering turns to puckering.  It’s an unfair double-bind. Damned if you try something new and it doesn’t work, and damned if you stay the course and don’t hit the numbers.  The most popular approach seems to be to do more of what worked.  A good approach, but not as good as it’s made out to be.

Doing more of what worked is good, and it works.  But it can’t stand on its own.  With today’s unreasonable workloads, every resource is fully booked and before doing more of anything, you’ve got to do less of something else.  ‘More of what worked’ must walk hand-in-hand with ‘Stop what didn’t work.’  Without stopping, without freeing up resources, ‘more of what worked’ is insufficient and unsustainable.

But even the two together are insufficient, and there’s a much needed third leg to stabilize the stool – ‘starting new work.’  Resources freed by stopping are allocated to starting new work, and this work, also known as innovation, is the major source of growth.

‘More of what worked’ is all about productivity – doing more with the same resources; and so is ‘stopping what didn’t work’ – reclaiming and reallocating ineffective resources. Both are important, but more importantly – they’re not innovation.

As you’re well aware, the rules are changing faster than ever, and at some point what worked last year won’t work this year. The only way to stay ahead of a catastrophe is to make small bets in unproven areas.  If the bets are successful, they turn into profitable innovation and growth. But the real value is the resiliency that comes from the ritualistic testing/learning cycles.

Going all-in on what worked last year is one of the riskiest bets you can make.

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Mike Shipulski Mike Shipulski
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