Thoughts from the Umbrian countryside

I have just come back from two weeks in the Umbrian countryside – fabby, as my children would say. The only work book I took was ‘Profit Beyond Measure’ by Johnson and Broms. I had known about its impending publication for some time and was looking forward to it. When I read the foreword by Peter Senge I thought this is the book I wanted to write.

It opens with a brilliant exposition of the differences between Ford and Toyota. Regular readers will know of my enthusiasm for the subject. What was fun was the way it was treated – the Ford and Toyota executives took different learning from Henry Ford’s original plant.. But I won’t spoil it for you.

I was less enamoured with the suggestion that managers should follow biological systems, the argument (rightly) being that biological systems show the capacities to self-organise, behave interdependently and manage diversity. The problems I had were: To encourage managers to believe in something so esoteric might put them off – they want to know what to do on Monday; and organisations are, after all, man-made – what progenitor could be less natural?

Of course the principles are important to a systems design. The key, for example, to self-organisation is measurement. The authors indicate the criticality of measures in the hands of those who do the work, and even more strongly advocate the removal of the wrong – traditional – measures, but when we turn to a solution, they recommend what is, in effect, a variant on activity-based costing (ABC).

I wrote about the fundamental flaw in ABC in ‘I Want You to Cheat’ in 1992. The authors accept that managers need some persuasion, they write: ‘Perhaps managers would be more likely to treat an organisation as a system were they able to assess its operations with information that resembles familiar management accounting’. But any such measures would not help the managers solve their problem.

I would have preferred that they wrote about how to derive measures for the work flow and how to ensure they were used where they could be of greatest value. Managers will only solve their problem when they can see that the change begins with a preparedness to change the way they think. That, in turn, will change what they do.

So now I feel OK. I’m going to get on and write the book I have been wanting to write. If you can’t wait, I have said before in this newsletter that chapter 5 of ‘The Case Against ISO 9000’ is the best I have written on systems thinking. The book sales are crap in the UK and terrific in Japan. As you know, it makes me wonder why the British are less curious – maybe the Japanese are just under the gun.

I do recommend you read ‘Profit Beyond Measure’. It is an important book.

You can get it from Amazon.


A Fireman writes

A Fireman wrote:

‘As a member of the fire service I note you don’t mention that the government has not yet removed the perverse incentive within the fire service Standard Spending Assessment that the more calls a fire service has the more money they get. Therefore no incentive to reduce waste. They have made promises to address this for the last four years.

But have set targets for reductions.’

So nothing new there then.


Civil Service Master Classes

Whilst ministers foist bad management practice on the civil service, there are those whose job it is to Do Something Useful. The Civil Service College have asked me to lead Master Classes in ‘The Better Way to Best Value’, ‘Systems Thinking and the EFQM model’ and ‘The Systems Approach to Call Centre operations’.

For listings of Vanguard public workshops go to


Japan suffers under burden of ISO 9000

Last month I received the following news from Japan:

>> Japanese labor union for construction sector warned and requested improvements of increasing overtime works in construction sites for construction companies’ executives. Daily Construction News (Japanese daily journal for construction sector) reported on June 15th: There has been an alarming increase in overtime on construction sites. The main cause is that workers are having to comply with excessive documentation due to registration to ISO9000. In Japan registration to ISO9000 amongst construction companies has been increasing rapidly and the overtime problems are now being revealed.

I can hear the cries of ‘they didn’t have to do that’ and ‘it’s OK if you do it right’, but what concerns me is what people DO DO, not what they could do. We (the British) should be ashamed that we inflicted this madness on the world in the name of quality.


Sizzling Summer offer

This is your last chance to take advantage of the Sizzling Summer offer

If you want to get up to speed with systems thinking – the better way to make work work, we have a special offer – ‘The Vanguard Guide to Understanding Your Organisation as a System’ and the CD-ROM ‘Change Management Thinking’ for a low low price.. only £150. a saving of almost £200.

The CD-ROM is heuristic – you learn by discovery; you can spend five minutes or five hours. The breadth and depth of the content is without equal. The Guide is linear – it shows you the steps to take to understand the ‘what and why’ of your organisation’s performance as a system.