Do not confuse coincidence with cause and effect. True: anyone could make a list of companies that are doing well, even though their management follows one or all of the above bad practices. These companies are saved by good luck, coincidence, having a great product or service that commands good market. Any of these companies might do much better were the management to learn some theory of management…
Likewise, one may find companies that are trying to do everything right, yet are having a hard time to survive. They would be still worse with bad management. How much worse, no one could know.
How far have we gone? Careful thought concerning the origin and effects of the prevailing system of management will come forth with this question: Does anybody care about long-term profit?
Why do we ask a question like this? Every manager supposes that he is doing his best. He is, and this is the problem. His best efforts, without knowledge from the outside merely dig deeper the pit we are in.
Deming, Dr. W.E. The New Economics, 3rd ed. (p. 26)
RECENTLY, I was having a conversation with a senior manager about reporting the state of their delivery teams’ progress to top-management that brought the above excerpt to my mind. They had asked for my advice on what metrics I thought critical for tracking the performance of their teams and how to show them to top-management. I made my recommendation and they averred that leadership doesn’t care to know anything more complicated than a traffic light status report. It’s either “on-track” or “in trouble” and with how many days to go.
The manager’s concern was that they didn’t want to present or challenge their bosses with anything they were unaccustomed to seeing, and in so doing maintain the status-quo. However, for the past year and change their department was undergoing an ostensible “agile” transformation, aided at various times by expensive consultants. Why wouldn’t leadership want to understand how their divisions are running?
The answer lies with the boundary line of what’s “in” and “out” of scope.
Theory for Leadership of the Transformation
In the second chapter of The New Economics that concerns the heavy losses we’re accruing due to disregarded faulty management practices, Dr. Deming makes the following observation alongside a table provided by Dr. Edward M. Baker that describes where outsized gains are to be found, yet ignored:
Somehow, the theory for transformation has been applied mostly on the shop floor. Everyone knows about the statistical control of quality. This is important, but the shop floor is only a small part of the total. Anyone could be 100 per cent successful with the 3 per cent, and find himself out of business. (p. 27)
It’s difficult to imagine, but we’re still at the starting line Dr. Deming laid out for us decades ago, pouring enormous amounts of time, energy, resources, and money into shifting the needle for a measly 3% gain while ignoring the 97% gains just waiting to be exploited. Of course, you can’t obtain what you cannot see and there’s no shortcuts to doing so, and its doubly-difficult when you are subsumed in the prevailing system of management and conditioned to seeing and managing by visible figures.
How far have we gone? Nowhere near far enough, and unlikely to get much further than choosing a new pair of runners and lacing up.
In the case of the manager above, the solution for them is ongoing but begins by learning more about the system performance metrics I provided and how to use and present them to exploit their leadership’s curiosity about better insights into how a solution is being managed and delivered. It will likely end up as a PDSA experiment in the New Year.
Reflection Questions
Consider the implications of the scenario I describe above in context of Dr. Deming’s thoughts on the impact of transformation that’s limited to “the shop floor”. A big part of why we ignore the gains from the 97% that come from shifting our thinking is fear of the unknown. Many small-scale transformations start off very localized working on the sphere of influence that’s immediately available and changeable. How can we communicate to leadership what’s going on and why we need not just their support but active participation to get at those unrealized, outsized gains? How can we radiate information about our progress that’s aligned with the type of work systems we’re transforming? How would you advise the manager I described?