Action over knowledge

A reader wrote to inform me that following the Heathrow Terminal 5 debacle, BAA responded to a report from the House of Commons Transport Committee, defending their performance. They said:

‘We focused on fixing the problems at T5 and not investigating until those problems were resolved once and for all. Had we diverted our resources to investigating rather than solving the problems, we could not have fixed them as quickly as we did.’

As the reader notes: How can you solve problems if you don’t know what caused them?

Managers love fire-fighting. Knowledge is far less sexy.

Inaction despite knowledge

A top executive in the city has written to the Prime Minister to say the recent financial crisis was caused by incentives and thus commissions should be outlawed. He is right, it is something that has been known both specifically (in financial services) and generally for years, it is well evidenced by research and there is good theory as to why. It is entirely predictable that incentives will always get you less and, as in the recent episode, could even destroy you.

The FSA promises to tinker with IFA commissions by 2012 (why wait?). But there are no plans for tackling the real problems.

Blame over knowledge

‘People will be held accountable’ says the minister for Children, Ed Balls, following the death of ‘Baby P’, the child killed by his mother and accomplices in London. While the media joins Balls in his witch-hunt, one commentator is pointing to the system as the cause of failure: an academic, based in Lancaster. Her work shows how the new IT system promulgated by Balls creates a service that is predisposed to NOT help children.

It is easy to see how children get seen by lots of different people: every time a child is referred it is treated by the IT system as a ‘new’ case. Then those who visit will be predisposed to avoid taking the child on. Why? If you take a child on, the computer system will allocate ‘workflow’ activity targets, hard-wired to a ‘RAG’ status that gets managers hovering if anything is ‘going red’. It is better to discount relative’s or neighbours’ reports and/or find any reason notto take the child on. Read her commentary in the Guardian:


Simon Caulkin also wrote about this important work in his column. Go to: http://www.guardian.co.uk/business/2008/nov/23/simon-caulkin-baby-p

It is Balls who is to blame. It is he who has driven the new computer system into all children’s services in the name of improvement.

According to a reader, social workers are calling his department (DCSF) the Department for Curtains and Soft Furnishings. It is hard to lead people who have no respect for you.

Narrative over knowledge

I met with people reviewing the new planning application system (‘One App’) for the minister. It is a classic example of a one-size-fits-all, IT-led, rules-based design that will prevent the service absorbing variety. In short it’s a shocker but at least this IT system won’t kill our children, it just upsets people who want to make planning applications. What I learned from civil servants is that the report has to fit with the minister’s narrative. And that, of course, tells the story of the recent One App implementation as an important step forward upon which we will now build. Did we elect such a self-serving uncurious person or did the regime make him like that?

The problems with One App are also being felt in other services. Computers gaily fire out electronic requests to the Environment Agency, Fire Services and others, stuffing them with waste. The whole idea was we needed to speed up planning. Local Authorities using the Vanguard Method have shown how to do that without computer systems. Citizens bring gratitude and flowers, planners enjoy their work. But sadly better planning services at lower costs leading to happier citizens doesn’t fit with the minister’s narrative.

Ideology over knowledge

The Fire Service is being obliged to centralise its control rooms. It is an example of the obsession with service factories, economies of scale. The project is behind schedule, is experiencing IT problems, and the promised savings to local authorities of £14m is now, apparently, not going to be realised.

Meanwhile the union is saying 92% of fire-fighters think this will make their service worse. I am with them, because economies are in flow, not scale. But like the other factories were going to be stuck with it. And the costs. And the worsened service.

Belief over knowledge

The Commons Home Affairs Committee was told visas were being granted rather than rejected in order to meet processing targets. ‘It is easier for staff trying to hit processing targets to approve an application than reject one’, said Linda Costelloe Baker, who monitors Government visa refusals.

And instead of understanding that the phenomenon is ubiquitous, systemic and ought to drive the committee members to do something the committee will think it is a management problem. This and other committees have been told the same thing many times over but they can’t understand it because it offends a deeply-held belief.

Prejudice over knowledge

Audit Commission inspectors cannot argue with the results achieved by systems thinkers. But that doesn’t stop inspectors recommending (i.e. obliging) actions that they are told to inspect for as evidence of ‘good management’. For example, having achieved performance that puts targets in the shade with processing benefits, one council has been advised they now need to develop SMART targets. They got to such amazing performance by realising that targets were dumb.

Another example: having developed a customer-sensitive lettings process, where all pertinent issues are taken into account by meeting people, the organisation was advised that it doesn’t do enough about promoting ‘diversity’ and ‘inclusion’. Inspectors cannot see that the design copes excellently with both individual and community issues and does so in a way that is sensitive to individual and community needs and differences. Instead what the Audit Commission inspectors want to see is things like ‘workshops’ on diversity. So you have to put your tradesmen in a room and brainstorm ‘how should we deal with diversity?’ If the tradesmen feel affronted (‘I don’t care what colour people are, I fix the taps’) they have to keep their mouths shut, play the game and let management get it documented so the Audit Commission can give the thumbs up.

And more: They want to see ‘benchmarks’. Systems thinkers know why you should never benchmark – everything you need to know to improve performance is in your own system if you know how to look, leaving aside reliability problems with comparison and copying without knowledge.

All of this is bad advice, but ‘advice’ given by people with power – if you don’t do as they tell you, you will suffer. The Audit Commission should be closed down, it is driving up costs, worsening service and demoralising people. It is a purveyor of bad management.

Achieving targets, not purpose

A reader tells me his local paper ran a story about a local councillor who said

‘…plastic bottles and containers will still not be collected for recycling by the council. We are judged on our recycling targets by weight not volume. We could spend thousands on new lorries and extra journeys to collect plastic which is bulky but very light, and it won’t improve the figures.’

He knows that what matters is pleasing the inspectors, not doing the right thing.

NI 14 brings out the vultures

A reader writes: ‘Looks like the NI14 gravy train is fast approaching the platform’.

He was referring to an attachment promoting a new service from consultants, offering to make organizations ‘best in class’ by helping them discover that 20-50% of customer contacts are avoidable, by giving them new complaints procedures and methodologies for capturing customer data.

The obvious appeal of the concept (removing failure demand means less cost) will lead command-and-control thinkers to be easy prey for those who know how to sell to someone who is pre-occupied with costs. The bandwagon now following failure demand includes IT providers offering new IT systems for monitoring and tracking failure demand. They will lead to a bureaucracy of inappropriate management behaviour and an increase in the size of the management factory. The snake-oil providers make beguiling use of cost-benefit analyses to make the case for investing in a programme of change to tackle failure demand. But do they know anything about method? These appealing ideas will come to nothing, except greater waste.

Failure demand is just one of the things you need to study in order to make the case for a change to a systems design. To put it another way: failure demand is a common feature of traditional ‘command-and-control’ service organisations. To get rid of it you have to change the system.

I am writing a definitive article on failure demand for Customer Strategy magazine. When it is published I’ll let readers know.

Lament from the front-line

A reader writes:

‘Converts to the Vanguard Method have been trying to help our Chief Executive see sense. We placed hard evidence on the table, for example one of the interventions delivered a £300K reduction in the cost of recruitment advertising whilst improving the recruitment process. Because this saving is spread around our organisation’s services the bean counters aren’t interested (does not fit into ‘efficiency savings’ you see). If that’s not bad enough imagine our despair when we learn from the local paper we are getting an ‘efficiency team’ at a cost of £90K, tasked with delivering £250K worth of efficiency savings primarily through service cuts. A local councillor expressed the view that a proportion of the saving could be made by scrapping the £90K team before it starts, I’m with the councillor.

It’s also ironic that recruitment to the new ‘efficiency’ team will be an easy, customer-friendly process delivering on the required time scale. Systems Thinking made that possible.’

I feel sorry for him and others like him. We have learned to insist that our work starts with the leaders, they have to UNDERSTAND systems thinking (commitment is easy, understanding is different). Otherwise good people who have got it get demoralised when they see their leaders doing stupid things. And, unfortunately, getting it doesn’t happen by showing the evidence. If that were true there would be many more systems thinkers.

What do you do in a downturn?

The Wall Street Journal reports that while GM and Ford are laying people off, Toyota is engaging their people in improvement activities. GM and Ford are hoping the US government will bail them out, Toyota simply gets on with the job, improving the system.

See: http://online.wsj.com/article/SB122384818385826909.html#articleTabs%3Darticle

Tool heads fess up

According to people who attended the latest ‘lean’ Summit, Dan Jones, one of
the leading proponents of ‘tools’ said the lean tools have not achieved the
expected results, adding it has been hard to engage managers and leaders and
thus the change has been difficult to sustain. And their solution? More tools!
Visual management, A3 exercises and standardising processes.

They just don’t get it.

The tools developed by Toyota were developed to solve problems associated with making cars at the rate of demand. Service organisations have completely different problems to solve. Ohno insisted we should never codify method – write tools – for it is thinking – how you conceptualise your problem that is the key.

Tools like A3 and visual management won’t deliver a change in thinking – people just fill the blanks with their current (wrong) assumptions. Standardising processes, a favourite of the tool heads because Ohno said ‘first you must standardise’, appeals to the command-and-control thinker but in a service organisation standardising processes will lead to the system not absorbing variety (as the tool heads have achieved with HMRC – newsletters passim).

These people are no different to managers – they won’t get it until they do it. It takes doing it to get it because it is counter-intuitive. As many Toyota people who worked with Ohno always tell me: ‘Ohno would never explain’. This is why. Getting knowledge starts with knowing how to look.