Sunday, September 30, 2012

Do We Know How to Learn?

The theory of knowledge that management in any form is prediction.”  W. Edwards Deming

When I first read the above quote many years ago, I didn't fully comprehend what Deming was trying to say.  After a lot of thought, reflection, and experience with a variety of organizations and management systems, I came to realize the significance of this statement as the basis of organizational - and personal - learning.

Whether through arrogance, lack of understanding, or just having too much to do, many organizations have failed to adopt of the Plan-Do-Study-Act (PDSA) cycle within their operations.  Others have implemented the cycle within their problem-solving process but failed to recognized it as a mental model for leadership and decision-making.

The Learning Organization

The power of PDSA thinking lies in the realization that every decision is, in effect, a prediction that a specific outcome will occur.   If one consciously adopts this mindset and practices it to the point where it becomes natural, significant learning can occur.

Taking action and expecting a specific outcome is not profound or revolutionary. But too often, the connection between action and outcome can be so basic that it becomes unconscious. And when the connection is not consciously recognized, little or no follow-up takes place to assure that the outcome is as expected and more importantly, why or why not a particular outcome occurred.  It is this lack of follow-up that prevents learning from taking place.

Too often, I have seen organizations continue to operate in the same manner, even when it does not appear to work.  They try harder or their leaders emphasize performance more strongly but any improvement in results that does occur is short-lived.  Organizations like this don't seem to understand that their performance is not the due to chance, but the result of a set of predictions that are failing to come true.  Improvement requires careful observation and study to determine why their hypotheses are false.

When decisions and actions are seen as hypotheses that specific results will occur, there is more of a tendency to watch for the connection.  “The why” becomes just as important as “the what” when reviewing results.  When results do not meet expectations, team-level reflection takes place to understand the reasons and the hypotheses are adjusted accordingly.  It is this process that enables organizational learning to occur.

When looked at in this way, it becomes clearer that becoming a learning organization does not mean spending more time in the classroom.  It means teaching people to consciously recognize that decisions are predictions, and honing the ability to study and understand whether (and why) results match the predictions.

Developing a PDSA mindset throughout an organization takes a lot of effort, practice, and patience.  People have to be coached and questioned regularly to understand that actions – even seemingly small ones – are predictions of specific outcomes.  The more developed this level of reflection becomes, the more the process will become a habit, and the more organizational learning will occur.

Sunday, September 2, 2012

The New Blood Dilemma

If there is one statement that always makes me cringe, it's, "we need to bring new blood into the organization." Often the result of frustration, business leaders tend to look to the outside in the hopes that someone who isn't already "poisoned" by the company's systems and culture can bring in the energy and new ideas to address problems and help transform the company.

Addressing Cultural Apathy

There are many examples of companies becoming stagnant and not addressing problems effectively - or getting to the point where the problems are no longer seen as problems. When this happens, though, it's critical to understand the reasons behind the lack of success rather than jump to the conclusion that reaching outside for new leaders is the answer.  New leaders are a countermeasure that can fail if the root causes of the poor performance or apathy are not effectively addressed.

As with any aspect of performance, improving the culture begins with clarifying the ideal condition - i.e., what you want the culture to look like, how people are expected to perform, the energy level, etc.  Once the ideal culture is defined, it's time to look for root causes or barriers preventing you from getting there. This may involve bringing in new leaders from the outside or it may not. Either way, a decision can be made logically rather than as reaction to frustration.

The Problems With New Blood

Although new ideas and increased energy can result from new leaders, there are many potential drawbacks that need to be considered before making the decision to hire from the outside.

New leaders can very easily have a negative effect on the cultural elements that you do want to maintain. I've seen situations over and over again where new leaders bring with them a new management style or differing values that actually damage the organization.   This could result from increasing fear, shifting priorities, ignoring direction, or a host of other elements that are not actually related to the cultural problems you are trying to address.

Another issue with new leaders is they often do not know the company's systems, products, or customers, and the pressure to quickly  bring about change can lead to poor decisions and destructive results.  Unless the organization has a clearly defined way, new leaders have the freedom to operate in any way they see fit - which can lead to confusion and frustration of team members.

It has been speculated that one of the contributors to Toyota's recent problems was the hiring of leaders from the outside who did not truly understand the Toyota Way. The tremendous growth experienced by the company had led them to abandon their policy of promoting only from the inside and bring in leaders who had not grown up in the system.  And if it can happen to a company with a way as well developed as the TPS, it can happen to anyone.

Another major problem with hiring leaders from the outside is the demotivation of existing team members. Those on the team who want to grow and develop can begin to see feel undervalued, frustrated, and stuck.  As a result, they may leave the company or stay with a much lower level of energy.

Finally, hiring for the outside is expensive in terms of recruiting costs, time, and training of the person hired.

How To Do It - When You Have To Do It

Anyone reading this post may think that I never support the idea of bringing in people from the outside. Although I don't particularly like it, I do recognize that there are times when it is necessary.

Before doing so, however, it is critical to clarify the ideal state so you can effectively understand the reasons behind the gap between the ideal and the current state.  If it's a leadership issue and changes are necessary, look inside the organization before going outside to find replacements.   If nobody inside the organization is qualified for the position(s), look outside - but recognize that not having people ready identifies a serious problem within the leadership development process and requires countermeasures to prevent from having to do it again.

Also, the clearer the company’s values and way are understood and developed, the better chance you'll have of hiring the right person and improving his or her chances for success.