kaizen

It may be odd to start a post with a couple of clarifications but I still want to do that in this case, of reasons that will perhaps become apparent further down. First, this post is not about a problem unique to one or two companies that I may have worked with and second, I do think management consultants can be useful from time to time (including myself). Read on!

I am talking about the situation when the top management of a company or a division realizes that some kind of improvement, e.g. reduction of the number of customer complaints, is urgently needed. A common reaction to this sudden realization is to set up an “improvement project”, a task force geared to improve the situation. The task force may get its own steering group with a few of the most enthusiastic members of the organization’s management team, it may get a reference group (of other interested people), and it will name a number of people to be on an improvement team.

The results from the improvement project set up as described above are often disappointing of several reasons:

• The steering committee members will see this as something out of the ordinary and will give the steering group meetings a lower priority than say the management team meetings or some urgent operational issues needing attention.
• The resource requests for the task force will not end up in the organization’s regular resource management systems and may therefore be ignored.
• The goals of the improvement project may or may not be aligned with the business goals of the organization.
• Nobody is formally rewarded (bonus etc) for doing a good job in the improvement project as it isn’t connected to their regular personal result plans or day to day tasks.
• The results from the improvement project are hard to disseminate to the rest of the organization.

Cajsa Warg’s “A Guide to Household Chores for Young Women”.

Many of the problems above emanate from the fact that we don’t use the regular organization and the regular structures in the organization to run the improvement effort; that we instead build a parallel ad-hoc task force to do the work.

Instead I suggest that the existing regular structures are used for the improvement effort:

• Add goals for the planned improvement effort in the (annual) plan for the organization and break down these goals on the individuals that will participate in the improvement effort.
• Track the goals in the regular management team meetings dedicated to track all the business goals of the organization.
• Use any regular improvement organization or group that may exist for implementing the improvement. A typical candidate group is the “quality group” or similar that usually focuses on managing the quality system manual of the organization and on managing any external audits. These people must not only be informed about the improvement effort, it should be a natural and important part of their day to day activities.
• Document the results from the improvement effort in the quality system manual in the form of updated processes, role descriptions etc., not in Powerpoint presentations stored on the improvement project Sharepoint site.

If any of the structures suggested above like an annual planning process, a quality department focusing on improvement, a quality system manual, or regular management team meetings with tracking of the set goals are missing or are ineffective, they should be fixed instead of by-passing them with a task force. Fixing these things should in fact be a high priority early goal of the improvement project so as to bootstrap the project. This is very much in line with the Toyota Production System’s principle of Jidoka, to stop the production line at any time to fix the process instead of fixing the defect products afterwards [1]. Appointing a special task force will hide an organization’s inability to execute the tasks through its regular structures, just like problems in the manufacturing process remain hidden if one settles for fixing the defects afterwards.

So let us heed the advice of the 18:th century Swedish chef Cajsa Warg who in many recipes in her famous cook-book from 1755 wrote “One taketh what one haveth.”

References

[1] The Toyota Way, Jeffrey K. Liker

The cold spell over the Nordic countries was felt by all the delegates to the COP15 conference on global warming. The result of the summit was a lame document that despite its lameness wasn’t accepted by all countries [1]. Is there a connection between the cold weather and the outcome?

This may sound like a condescending question insulting the delegates’ intelligence. Of course there are a lot of reasons for the failure of the conference. I think the question is relevant to some degree though.

As I’ve hinted in an earlier post, the mitigation of the global warming is the greatest change management project humanity has ever undertaken. The idea is to fundamentally change the way we produce and use energy to avoid dramatic changes in our environment and living conditions.

So why does freezing one’s butt off matter? Humans are, despite the evolution of the large neocortex fundamentally controlled by the old “reptile brain”. This part of the brain is what makes us angry, makes us make love, makes us eat candy, and makes us do many other things based on emotions. Emotions are very strong motivators, often stronger than any “higher order” logic we can come up with in our cortices. Emotions are rational in the way that they have kept us alive and procreating from the time when our ancestors were tiny lizards (yes, you have lizards in your family). We base many of the biggest decisions in life on the emotional “click, whirr” response described by Robert Cialdini in [2].

Recent change management literature emphasizes the role of emotions in leading and promoting change. Dan Cohen says: “Both thinking and feeling are essential, and both are found in successful organizations, but the true heart of change is in our emotions.” [3]. Black and Gregersen discuss the importance of creating “confrontations” to move people to change. These confrontations should be what they call inescapable experiences that “cannot just be mental” [4]. Instead they “need to actively involve as many of the senses as possible: touch, smell, sight, sound, taste.” Although Black and Gregersen don’t use the e-word, the clear purpose of that multi-sensory experience is to evoke emotions, not just thoughts.

To evoke the right emotions, the “inescapable experience”, the summit should probably have been held in a very hot place – without air conditioning, not in a cold place like Copenhagen in December. An inescapable category four hurricane passing by the venue would probably have added a few signatures to the treaty.

Links and references

[1] Preliminary version of the Copenhagen Accord

[2] Robert B. Cialdini, Influence, Science and Practice

[3] Dan S. Cohen, The Change of Heart Fieldbook

[4] J. Stewart Black and Hal B. Gregersen, Leading Strategic Changes, Breaking Through the Brain Barrier

I watched the Nobel Peace Prize concert last night. The Norwegians know how to throw a party! I immediately fell in love with Esperanza Spalding’s music. And Natasha Beddingfield, who also performed, has been one of my personal favorites a long time. Anyway…

The Peace Prize is about making change happen. Each and everyone on the list of laureates have been instrumental in making this world a better place. Perhaps Obama was given the price more in anticipation of future deeds than already accomplished changes but many of us still have high hopes.

Big changes in the world seem to be associated with strong leaders and role models. It is hard to imagine the civil rights movement without Martin Luther King, the abolishment of apartheid without Nelson Mandela, or the democratization of Poland without Lech Walesa, all of whom have also received the Nobel Peace Prize.

So what does it take to become such a leader? Can we learn anything from the Nobel Prize Laureates? I suggest that conviction and perseverance are the main characteristics of these leaders. While some of them, such as Martin Luther King had a lot of charisma, others such as Martti Ahtisaari don’t strike me as particularly charismatic. (But like most Finns, he had that particular Finnish perseverance and stubbornness that we call sisu.)

In his book Good to Great Jim Collins actually emphasizes that charisma is not required (he says it may indeed be counter-productive) for leading and changing the successful companies that he studied. Instead Collins talks about the ability to keep the core values of the company and being there for the long term. He also believes that leaders should be “clock builders” rather than “time tellers”. He means that they should focus on building capabilities into the organization rather than insisting on becoming or remaining the visionary decision maker.

Indeed, many of the Peace Prize winners and other great leaders have left a lasting legacy. South Africa is well on the road to healing the wounds of apartheid. Mahatma Gandhi’s India is the world’s largest democracy and is rapidly becoming one of the major economic powerhouses. Poland is one the of the best performing former communist countries. And while the US still has its problems, it has come a long way since Rosa Parks was arrested for not giving up her seat on the bus for a white person.

My conclusion is thus that it probably takes an energetic and convinced person to lead big change. But that the person should at the same time down-play his or her role and focus on building systems and capabilities that enable the change to last. I wonder who is going to step forward as the leader of the greatest change project in the history of mankind, the mitigation of the global warming.

Links and references

[1] Good to Great, Jim Collins

[2] The Nobel Peace Prize 2009

Every so often organizations that aren’t happy with their operational performance embark on a process improvement program of the “one-size-fits-all” variety, decide to implement the latest hyped-up development process, or purchase the latest model-based development tool without investigating what their prioritized improvement needs really are. One company that I was helping had for instance planned to ramp up their verification and validation activities as part of a general “quality improvement” effort. When we started talking about their quality and other priorities, we found that both customers and other stakeholders were very happy with the quality of the products but not with the responsiveness to new customer requests. Clearly, in this case, more verification and validation was not what they needed the most.

A simple process for finding improvement opportunities.

A good starting point when looking for the most important improvement opportunities is the organization’s set of business goals as stated in a business plan or similar. (When no business plan exists, key people within the company can usually write a good enough business plan in about one hour.) Information that I want to find in a business plan include:

• What customer segments do we want to target?
• What value do we deliver to the customers?
• What value do we deliver to the customers’ customers?
• With what products and major product features so we deliver that value?
• What are our tactics to lock out the competitors and lock in the customers?
• What are our unique selling points? Why buy from us instead of a competitor?
• Do we have other stakeholders with specific requirements or needs, e.g. authorities or employees?

From this information we can start reasoning about the results that our customers and other stakeholders expect from us and that will make us stand out relative to our competitors; what we need to be really good at producing. Particularly important results are those that support our unique selling points, the product features and our interactions with the customer that make our company different (and hopefully better).

Typical product features that might give us a competitive advantage include aesthetics, availability, ease of buying, functionality, performance, conformance (to standards and regulations) and price. In our interactions with our customers we could excel in e.g. responsiveness, innovativeness, security, accessibility, reliability, competence, credibility, and empathy.

A good example of the ease of buying product feature is Amazon’s one click shopping feature. It eliminates all time-consuming typing and makes it (almost too) easy to buy yet another book or widget. The same company’s success is very much tied to the security of the interactions over the web.

In parallel to identifying customer-oriented results that are important to our success, it is often useful to look at the same issue from an other angle by identifying risks for not reaching the business goals. As a complement to finding out what we need to do right, we here brain-storm what can go wrong. There are various more or less standardized risk analysis methods for finding risks. I will return to these in later posts.

Some capabilities.

Having the desired results and identified risks, we can start to identify what capabilities we need to produce the results and to mitigate the risks. It is also useful to think about what you can do less of (like in the example in the first paragraph of this post).

If for instance aesthetics is a unique selling point, or at least an important product feature, then we probably need to hire a designer or buy a corresponding service that will accomplish exactly that. We may also perhaps add a “look and feel” review in the development process or even a focus group. If conformance to regulatory requirements is crucial or even mandatory, then we need to know those requirements and build them into our work processes.

A number of general capability categories are illustrated in the exhibit to the right. (”Product baseline” refers to the previous version of your product. When developing a new version of a product, the starting point is obviously a very important success factor).

There is no rocket science here of course. But it does pay off to from time to time do the analysis according to the above steps in a structured way. If you are lucky, you may even find that you can actually do less to achieve more.

Jan Brink on Briar, world’s #1 dressage stallion, in one of Briar’s last public appearances in Falsterbo, 2009. When training a horse, there are no quantum leaps, only small incremental improvements reinforced during countless hours of training. I can testify that the human rider is no different from a horse in that respect.

In an earlier post I wrote about the pain that is often associated with changing the way we behave, the prerequisite for all improvement. I use the word “pain” here to mean all negative feelings that may be associated with the change such as uncertainty, lack of self-confidence, doubt, and fatigue. I also wrote about the faith we must have in the improvement effort (or any effort really) to keep going even if we don’t see or feel any immediate results. As I hinted earlier, I’ve seen many improvement efforts fail because of too much pain and because of lost faith.

Most of the failed efforts I have seen have been corporate-wide and large, with many people involved in an “improvement program”. They are often slow to start since many people need to be involved and got on-board. Funds must be requested and budgeted. There is a massive amount of planning of a large number of “tangled” activities and long discussions about goals and milestones. Soon enough, managers and other key persons start to feel that they can’t spend the time needed for the massive improvement program because of urgent operational responsibilities. There is simply a lot of talk, and very little action. Faith starts to fade. And should a big change actually be likely to come out of the program, then there will be pain, sometimes too much of it. (There is a third alternative, namely that the large improvement program only produces a few, small changes. Then chances are that the large improvement program is very inefficient and could be replaced by a smaller, more efficient one.)

The rather obvious antidote for both “change pain” and lost faith is to improve in small, independent increments. After all, if you can’t manage a small improvement, then you can’t manage a large improvement so it’s always a good way to start.

Small changes don’t hurt as much as large ones. Small, frequent improvements also keep the faith strong since you see results on a regular basis. They produce the “early wins” that Kotter writes about in [1]. You also learn stuff from each small iteration that you can apply in subsequent iterations. And if you fail, the failure will not be of epic proportions and you can most likely recover from it in the next increment.

I sometime hear that everything depends on everything else and that everything therefore must be changed at the same time. Or that the market situation demands a “quantum leap” in performance. (People forget that a “quantum leap” is in fact the smallest possible increment.) Usually it is possible to find reasonably independent improvement areas though, suitable for incremental improvements. There is an interesting and inspiring parallel in the software development community called Scrum [2]. It is an incremental project management process in which software is developed incrementally in “sprints” of one month.

* * *

I believe that improvement should be part of the regular operations of the organization rather than done in “improvement programs”. If it is integrated in the daily operations and the corporate culture, then it will almost invariably be performed in small increments and be based on real operational needs and business goals. These factors increase the chances for success considerably. If improvement isn’t a natural part of the daily operations, then it is probably better to fix that instead of kicking off an extraordinary improvement program. If there hasn’t been any, or enough (continuous) improvement for a long time, then a big “bold stroke” change might be necessary as a last resort. More on that later.

Links and references

[1] Leading Change, John P. Kotter

[2] Agile & Iterative Development, Craig Larman

What is the purpose of that company training? Or that next presentation you are giving to your colleagues? Or this blog post for that matter?

I’m an engineer by training and like many engineers, teachers and other professionals, I sometimes have this urge to tell people what I know. Perhaps to show off a bit. Or for some other obscure reason. The urge has decreased over the years but I can still feel it from time to time. Unfortunately doing a presentation during office hours just to tell people what you know is a waste of time. I suggest that the only valid reason for communication in a business setting is to change the behavior of your audience.

Have you changed your behavior yet?

Likewise, the purpose of training should be altered behavior. Good course evaluations are nice but if things stay the same after the training, then it is of no value. According to one of the pioneers in the area of learning organizations, David Garvin, learning is in fact the combination of knowledge and modified behavior [1]:

A learning organization is an organization skilled at creating, acquiring, and transferring knowledge, and at modifying its behavior to reflect new knowledge and insights.

Very little is of course new under the sun but sometimes insights are forgotten. The purpose of the art of rhetoric is according to Wikipedia exactly to “move audiences to action with arguments” [2]. It should be done with ethos, pathos and logos.

Even if we realize that our goal is to impact the behavior of our audience, we may still lack the skills to do so. During my Swedish and American engineering training i managed to take exactly zero credit points of rhetoric. I didn’t get a proper training in it until the “rookie training” at McKinsey&Co (unsurprisingly it was rather logos-heavy). Perhaps we engineers are also by nature a little weak in the pathos department which doesn’t make things easier.

Rhetoric is a technique in the greater discipline of change management which I will return to in later posts.

So am I wasting time by using this virtual space to share my opinions and the odd piece of knowledge? Well, I do believe (have faith in) that this blog will eventually somehow add to the impact that I have as a management consultant and change agent but the jury is still out on if and how that will happen.

Links and references

[1] Building a Learning Organization, David A. Garvin, HBR, July-August, 1993

[2] Rhetoric on Wikipedia

The exact string “high quality consulting services” renders over 100 000 hits on Google (without the quotes you get over 30 million). Having been in this business for some time, I always get a bit annoyed by such phrases. My platitude indicators are flashing red. What is meant by “high” I wonder. And by “quality” for that matter. And why is nobody ever offering “medium quality” or “low quality” services or products?

The word “quality” comes from the latin ”qualitas” which means “from what”. One common definition of the word is “The totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs.” (ISO 8402:1986). “Features” and “characteristics” are according to Dictionary.com synonyms so just “features” would probably suffice. But “stated and implied needs” is rather good. It says that we should not only address the explicitly stated needs but also those that we need to read between the lines or guess. “Bear on”, again according to Dictionary.com means to affect, relate to, or have connection with; be relevant to. Quality is therefore according to this definition the total amount of product or service features that are relevant to its ability to satisfy (customer) needs.

Quality according to Kano

Peter Drucker says “Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for.” This definition shifts the perspective from the product or service to the customer. The Japanese professor Noriaki Kano refines this by suggesting that not all features are equal when it comes to creating customer satisfaction.

Necessary features are those without which the product would be totally worthless. An example of a necessary feature of a car is propulsion. The graph to the right illustrates that you can never win a customer with only necessary features since all the competing products have them too. You can at best get a customer that is indifferent to your product or service.

Expected features are those that the customer typically puts on his or her shopping list. For a car that could be a navigator or a collision avoidance system. Yesterday’s expected features tend to become today’s necessary features. With enough expected features customers may prefer your product or service instead of that of your competitor.

Attractive features are features that makes the customer say “wow” in Tom Peters’ terminology. They are per definition unexpected. As illustrated in the graph, attractive features add substantially to customer satisfaction. It is hard to come up with examples of attractive features as they cease to be attractive as soon as the customer has got used to them. I said “wow” when I installed Ubuntu 9.04 on my laptop and the 3G dongle worked out of the box without configurations or installations. (With version 9.10 there was a regression of this functionality that made me rather annoyed. Attractive features soon become necessary features and may then backfire.) Still, attractive features are a very efficient way to increase customer satisfaction (when they work).

That all makes sense but we’re not done yet. In the book Zen and the Art of Motorcycle Maintenance the main character Phaedrus came up with the following definition of quality: “Quality is the response of an organism to its environment”. (Then he went mad.) Inspired by this rather philosophical definition I believe we can refine the definitions of Kano, Drucker and others to the following:

“Quality is what makes our customers do something positive for us, in response to our products and services.”

This means that quality is whatever makes the customer recommend our products for his or her peers and come back and buy some more. Quality doesn’t need to be in the product itself. It can be in the “One-click shopping” of Amazon.com that makes it (too) easy to buy books. It may emerge when we see to it that one of our customers writes a paper involving our products and presents it at a conference. Or it may be a friendly voice on the telephone.

This may not be the ultimate definition but I have the audacity to believe it’s better than most of the alternatives.

Links and references

[1] Robert M Pirzig, Zen and the Art of Motorcycle Maintenance

[2] Tutorials on the Kano model

[3] Alternative definitions of quality

Vicious circle of poor quality

Vicious circle of poor physical shape

Poor organizational performance is often the result of a vicious circle. One example of such vicious circle in a product development organization is: poor product quality leads to a large effort spent on rework, customer support and bug fixes leads to lack of resources leads to poorly executed early phases of the next development project leads to poor quality…

Similar kinds of vicious circles can be found in our personal lives, for instance: bad physical shape leads to general tiredness and illness leads to pain when exercising leads to avoiding exercise leads to bad physical shape…

For improvement to happen, a vicious circle often needs to be broken. This requires, yes, faith and pain.

The first runs or workouts after a period of sedentary life are painful. You may become short of breath after a few hundred meters of running and your muscles will most likely be sore the day after. If you can’t endure that discomfort or pain, no improvement will be possible; no pain, no gain. Another type of discomfort is that of sacrificing some other perhaps more immediately gratifying activity for your exercise.

To break operational vicious circles involving e.g. poor product quality, “organizational exercise” is required. Ultimately people need to do things differently from what they did in the past to break the vicious circle. (This may look like a truism but it is surprisingly often forgotten.) The change will require new skills to be learnt, old habits to be kicked, perhaps even slightly modified values to be adopted. Some of these things can be joyful but some can also be painful. To find the time for that extra effort you may need to delay the release of a new product, to hire extra help, to work overtime or something similar. All that adds to the pain.

When starting to excercise, you usually don’t see or feel any improvement in the beginning. You only feel the pain. To get through the first few workouts you therefore need to have faith in the future positive effects of the excercise. Only that faith will take you to the point where you can start to feel or measure the improvement. In an organization you likewise need to have faith in the improvement activities to make the initial sacrifices and take that initial pain.

I will return to faith and pain in later posts.

Links and references

There is a great treatise of vicious circles and other types of systems involving feedback loops in Peter Senge’s book The Fifth Discipline.

The research about the human brain and behavior strongly suggests that most of the information processing we do in our brains including a substantial amount of decision making happens without ourselves being aware of it (in the sense that we can communicate such awareness). Libet’s experiment (see a Libet’s short delay) for instance shows that an action potential builds up in the brain up to half a second before we become aware of ourselves taking an action.

Other unrelated research suggests that a lot of the knowledge we use when performing familiar tasks is tacit knowledge, i.e. knowledge in a format that isn’t easily describable or communicable. So not only do we make subconscious decisions, we base those decisions on subconscious knowledge when we are really good at what we are doing. The natural development of competence has by several authors (the original source seems difficult to find) been described with the model in the exhibit below.

The stages of competence development.

When discussing knowledge a distinction is often made between “knowing that” and “knowing how”. We know that 2 + 2 = 4 and we know how to add numbers. (In my native languages Finnish and Swedish there are actually, in contrast to common English, different words for these two types of knowledge. In Finnish we say “tietää” and “osata”, in Swedish “veta” and “kunna” – probably corresponding to the old English words “wit” and “ken”.)

The whole purpose of an operations manual is to describe and facilitate the build-up of know-how in the organization. The question is: How can we describe and disseminate know-how that in its most evolved form is unconscious? This is an other way of asking the questions put forth in an earlier post.

I still don’t have answers to the questions referred to above that I’m satisfied with but I’m convinced that we have to take into account how the human brain is wired.

Now to something completely different

I started out my career designing image processing algorithms and hardware. At one point I rather inexplicably diverted into management consulting and took interest in issues such as operational effectiveness, cycle time reduction, and quality management. A while after my defection an old colleague of mine, who was at that time working on his PhD in image processing, asked me in an email what I was doing nowadays. Having tried to explain to him what I was doing, I got a reply with only one word in it – “perverted”.

In some of my darker moments as a management consultant, especially when working with quality management systems, I tend to agree with my former colleague. The quality management system manual, or using my preferred term, operations manual (OM), is too often that Dilbertian “big honking binder” that everybody treats as a “dead raccoon”.

All is not gloom though. There are a number of compelling reasons to create and use an OM and there are success stories out there:

• An OM is a good place to store and make available good practices, a place for storing tips and tricks that have proven to work in each particular organization.
• An OM can be used as a basis for discussions and deliberations about good ways of working within the organization.
• An OM is the basis for training and training material regarding the organization’s way of working.
• An OM may be required as an evidence that you have practices required by various laws and regulations in place. Such specific documented practices are for instance required for manufacturers of medical devices and aircraft.
• An OM with common practices facilitates collaboration. If everybody in a global organization agree upon the typical steps in their project development process, then project managers can get a fair picture of the progress of the project and subproject teams can coordinate their work.

The benefits of the right number of good, required, and common practices are hard to dismiss. Try this corporate policy from hell to convince yourself: “It is our policy to throw away and forget past experiences, to ignore the law, and to let every project reinvent their ways of working from scratch.” If you really believe that the above policy is a good one, then you can stop reading here.

Those of you who are still with me may now ask (1) what a really useful OM would look like and (2) what it should contain, not to be treated as a dead raccoon by the staff, and (3) how should the management of it be organized so that it would continue to reflect the best practices of the staff that actually perform the work. I will attempt to address these question in later posts.