The greatest challenge is management resistance (Déjà vu)

Déjà vu is the phenomenon of having the feeling that the situation currently being experienced has already been experienced in the past.

I have this happen to me regularly. Let me give you an example. I recently read a report titled ‘Insights into how to keep up with today’s changing world‘ written by the Australian Transformation and Turnaround Association. I recommend reading it.

The report was written after surveying transformation and change leaders, in over 900 businesses, covering industries from banking and finance, manufacturing, technology, consulting, government, academia, and health.

When the question was asked ‘What is the greatest challenge facing your organisation this year and next?’ – a whopping 71% of respondents answered: ‘Management resist change’. It was followed closely by ‘New technology & business models’ which 67% of respondents also identified.

When I read this, it triggered a feeling of déjà vu. I was sure I had heard this before…

I looked around at some old articles and found one written 25 years ago titled: ‘Improving the performance of workgroups through information technology’ by Clive Holtham.

In 1992 Holtham stated:

The failure to improve the effectiveness of work groups often lies for less in any technical dimension than deep in the management style and culture of an organisation. If key strategic steps are not taken from the top of the organisations, no amount of effort at middle levels can compensate for this

Déjà vu!

Holtham is right when pointing to the top of organisations. We shouldn’t just limit management resistance to the often criticized ‘middle-management’ – or the ‘frozen middle’ as Peter Drucker termed them. A good example of this is when the CEO of one of Australia’s biggest banks announced that his organisation was embarking on a transformation that will move away from a traditional hierarchal structure, and yet, in that same announcement, the CEO also stated that the transformation would cut in two levels below him.

As with most problems that organisations are trying to solve, the problems have existed for a long time. Over the course of time, various frameworks, methodologies, and approaches have come and gone. Panaceas that promise much and purport to solve these problems, turn into fads and die, bowing out to the next wave of ‘new thinking’. As the 71% of respondents to the question: ‘What is the greatest challenge facing your organisation this year and next?’ can attest, Holtham’s issues of management resistance, highlighted in the early 1990s, gives empirical evidence to the fact that the latest panacea does no better than its predecessors

As with most problems that organisations are trying to solve, the problems have existed for a long time. Over the course of time, various frameworks, methodologies, and approaches have come and gone. Panaceas that promise much and purport to solve these problems, turn into fads and die, bowing out to the next wave of ‘new thinking’. As the 71% of respondents to the question: ‘What is the greatest challenge facing your organisation this year and next?’ can attest, Holtham’s issues of management resistance, highlighted in the early 1990s, gives empirical evidence to the fact that the latest panacea does no better than its predecessors

Turning our attention to ‘New technology & business models’, the paradox here is that IT & Digital teams do not have what is required within them to make it work either, or to put it another way, IT & Digital is cultural too.

Over and over again, new technology and business model improvements are thwarted by forces that are not commonly-known, and are illusive to those attempting to make changes. This social inertia is because of the lack of effectiveness in current methods available to technology professionals and managers alike.

Our findings show that the 71% quoted in Australian Transformation and Turnaround Association report is an underestimate. We have found that almost 100% of transformation activities fail, or fail to sustain, due to being fought off by the management culture, or to be more precise, fought off by the organisational system the managers have created.

Why do I want to turn the attention to technological transformation? International Data Corporation (IDC) predicts worldwide spending on digital transformation technologies will reach $1.2 trillion in 2017. That’s a lot of money being spent on change. How’s it all going?

PointSource, in 2017, surveyed 300 decision makers in Marketing, IT and Operations, and published the results in their ‘Executing Digital Transformation study’.

In their key findings, PointSource reported:

Organizations are not confident in their visions for the future: Less than half (44 percent) of respondents are extremely confident in their organization’s ability to achieve its vision for growth, and 4 percent are not confident at all.

Why the lack of confidence? The study found that management culture was an issue. For example, when decision makers were asked ‘Does your culture support change and innovation?’ – it was found that:

  • ‘Department leaders do not regularly collaborate with one another: Just 30 percent of respondents say departments across their organization always come together to problem solve.’
  • ‘Respondents feel their company culture supports the ideals of innovation, but they cannot overcome a lack of internal collaboration that makes executing digital transformation difficult.’
  • ‘(76 percent) of respondents say their department competes with other departments in their organization for resources and/or budget.’

The report goes on to give rationalistic ‘Tips for organisations’ to help them solve these issues. One ‘tip’ is: ‘Organizations must work to remove silos so that all members can collectively contribute to an improved end product that exceeds audience expectations.’

I had that feeling of Déjà vu once again…

Back in 1992, Holtham wrote:

It is necessary to be able to create new, more fluid partnerships and alliances, both within and between organisations

It is almost as though we learn nothing from our experience. The same issues are prevalent 25 years later, supporting the reality that they are designed into the organisation.

Sticking with technological transformation, you can’t move today without bumping into an article or speech that highlights the perils of ‘Being Ubered’ (a phrase coined by Publicis Groupe CEO Maurice Levy, meaning your organisation is at risk of being disrupted and dethroned, and therefore you must evolve). The facts pointed out are stark; very few of the Fortune 500 companies listed in 1955 either still exist, have not gone bankrupt, or have not been merged or acquired by another firm.

Maybe this is another contributing factor for decision makers lack of confidence in their organization’s ability to achieve its vision for growth, as reported by PointSource.

When I was a child I used to watch a futuristic world where the Daleks in Doctor Who would warn “You will be exterminated!” – now I’m an adult, I encounter the world where consultants warn “You will be disrupted!”.

Unfortunately, the prevailing answer to disruption, promulgated by the consulting firms, is to invest in technology. With a $1.2 trillion trough, you can see why. The problem is that to fend off disruption, investing purely in technology isn’t the answer, the organisational operation must also change. Both go hand in hand. Various commentators are now voicing similar opinions. However, is it again Déjà vu?

Peter Keen, in his book ‘Information Systems and Organizational Change’, published in 1980, wrote

When technology is changed, the other components often adjust to dampen out the impact of the innovation. Many writers on implementation stress the homeostatic behavior of organizations and the need to “unfreeze the status quo”

Peter wrote this 37 years ago. It’s not like anyone hasn’t heard of him. If you look at his biography it states that he has been ranked in a number of surveys as one of the world’s top 100 thought leaders in business, the most cited researcher in the academic and business literature, and among the top ten IT consultants!

The challenges of ‘Management resist change’, ‘New technology & business models’, ‘Executing Digital Transformation’ and ‘Not being Ubered’ are all a product of the same superordinate issue; the command-and-control design and management of work, which has dominated organisations for years, and, without method, is remarkably impervious to change.

Peter Keen wrote back in 1980:

We now have adequate theories of implementation. We have less understanding of counterimplementation … overt moves, often made by skilled actors, to prevent a disruption of the status quo.

Technology has been an unwitting instrument and enabler of command-and-control. This is because IT & Digital professionals are being asked to solve problems from a command-and-control point of view, and it is that very point of view that needs to change if we want to enable the technology to work and work well, from the users’ perspective.

Applying a design thinking, human centered, lean-agile approach, by using service design and experience design experts in a command-and-control organisation, will result in little to no discernible change.

The PointSource study shows a deep lack of confidence in executing digital transformation. If organisations are to spend $1.2 trillion, there will be a lot of money poured down the drain. As a consequence, many of the people involved in such programs of work will see their hard efforts wasted. Who wants to put their heart and soul into creating something that is either cancelled or is not valued by the recipients?

This isn’t to say that people at all levels are stupid, or guilty of malintent. This is not about stupidity or intention. Everyone would say they are trying to do things better. What is more appropriate is to state the people are guilty but not to blame, in other words, the crux is that they have been let down by bad perspective and methods.

To solve the challenges of ‘Management resist change’, ‘New technology & business models’, ‘Executing Digital Transformation’ and ‘Not being Ubered’, technology professionals and managers ultimately require a different structure, different measures and, most importantly of all, a different philosophy; one where they move beyond command-and-control, where the prevailing thinking is aligned to customers, and where they see their job as adding value to the work. This will then solve these challenges for good.

 

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Learning to See; Learning to Lead

In 2014 I presented at the Agile Australia conference on how to sustainably improve performance in organisations using the Vanguard Method. InfoQ recorded the session, and they have published it here.

http://www.infoq.com/presentations/vanguard-method

The videos that are used in the presentation can also be viewed in high quality here

https://www.vanguard-method.com/content/2/

Glyph Inventory 1_quote-open-2 We applied Systems Thinking from Vanguard. Systems Thinking is a fundamental way of examining the entire organisation, not just the IT component. It is a method to really understand what matters to the customer, to understand the dysfunction of current methods, measures and metrics, to get people who do the work, to experiment locally to design new ways of working. It is incredibly profound. I could talk another 3 hours just on Systems Thinking!

Patrick Eltridge, Former Telstra CIO, 9th December 2014  Glyph Inventory 1_quote-close-2

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Part I of my free eBook has been published

This blog has been pretty quiet over the last 2 years. The reason for this is that I have been working on a free eBook entitled “Theories of Work: How We Design and Manage Work“.

The purpose of writing this book has been to educate and create curiosity. It’s all been written in my spare time. I am not interested in making money from it, I am more interested that nothing inhibits a reader from reading it.

There are three parts to the book, and each part will be published online as a Webisode on a new dedicated site www.theoriesofwork.com. The online format protects the content owner, and enables anyone to either read it, or listen to it (an audio version will be coming soon).

I have “road tested” some of this material, in both the West and the East, and there seems to be genuine interest in its content; validating my assumption that it would be worthwhile writing the book. You may have seen my 21st Century PMO talk last year which contained content from Part I, or you may have seen my talk in Japan which contained content from Part II. You may have also read Deming’s 14 Points on my blog which contains content from Part III.

I have drawn on many sources for the content of the book, and in doing so I have kindly been given permission to use content from various authors, scholars, academics, publishers, institutes, and private individuals, under the agreement that it was a free, independent and a non commercial offering.

I have just published Part 1: Origins of the Design and Management of work at www.theoriesofwork.com.

Perhaps this might be of interest to you and/or to people that you know. I hope you enjoy it, and if you do, please tweet or publicise it so that others may also hear about it.

Here is a list of the Design and Management Concepts that are covered in each chapter.

Introduction and Preface

  • Discoveries
  • Purpose of this work
  • Organisational Norms
  • Panaceas and Fads
  • Organisational Traps
  • The Western Management Trap
  • The Problem to Solve

Chapter One: Early Beginnings

  • Craft Production
  • Industrialisation, Manufacturing Systems, Factories, and Assembly Lines
  • Centralised Authority
  • Cost Accounting
  • Payroll
  • Time and Materials
  • Piece-work
  • Production Quality
  • Standardisation
  • Interchangeability
  • Mass Production, Make and Sell, and Batch Production
  • Economies of Scale

Chapter 2: Management Arises

  • The Organisation, Top Down Hierarchy, Hierarchical Responsibilities, and the Organisation Chart
  • Division of Labour, Line Executives and Staff
  • Decentralisation and Division of Responsibilities, Operating Units and the Departmental Divisional Structure
  • Specialization and Functionalisation
  • Working Hours, Child Labour, Unions and Workplace Inspection
  • Personnel Management
  • Management Reporting and Real Time Data
  • Cost Accounting
  • The Salaried Manager, Management Schools, Textbooks and Manuals
  • Standardisation of Tasks, High-Skill Tasks to High-Cost Workers, and Quality of Output

Chapter 3: Management Science

  • Scientific Management and “Taylorism”
  • Productivity Incentives; Payment by Results
  • Work Analysis, Work Breakdown, and Work Measurement
  • Best Practices and Benchmarking
  • Standardized Work, Standard Times, Production Standards, Work Instructions, Job Descriptions, and Work Inspection
  • Division of Responsibility; Planning vs Doing; Blue-Collar vs White-Collar jobs, and Functional Supervision
  • Process Improvement and Waste Removal
  • Time sheets, Employee Discipline and Employee Performance Records
  • Worker Efficiency, Worker Utilization and Worker “laziness”
  • Staff Suggestion Schemes
  • Management Consulting

Chapter 4: Scientific Management!  A Mental Revolution

  • Command and Control; A Global Management Mental Revolution
  • The Efficiency Expert
  • The Bonus System
  • Gantt Charts; Planning Work, Presenting Facts about Progress, and Scorecards
  • Getting Work Done on Time, Standard Times, and Service Levels Time and Motion Studies
  • Removing Idleness and Waste
  • Moving the Work to the Workers (the Moving Assembly Line)
  • Task Cards and Time Clocks
  • Worker Report Cards, Inspection of Performance, Performance Reviews, Removing “Dead Wood” and Laggards
  • Forced Employee Ranking; the “Bell Curve”
  • Inspection of Workers, Supervisors and Executives
  • Vacation Schedules and Records of Absence
  • Quick Fix Change Programs
  • Functions with Department Heads and Targets
  • Quality Inspection
  • Activity Based Accounting
  • Mass Management Education, Courses and Literature
  • Documented Best Practices, Codification of Method, Written Documentation and Instructions
  • Assessing Job Applications Through Tests
  • Breaking Work Down into Components, and Specialized Departmental “Factories”
  • Scientific Management Applied to the Office
  • The Head Office
  • Technology to Aid Efficiency
  • Fordism
  • Flow Production, Routinized and Intensified Labor, Analysis and Documentation of Processes
  • Consumerism; Build, Market, Sell, Service
  • International Operations and Franchising Systems
  • The 8 Hour Day and 5 Day Week
  • Company Discount Schemes

Chapter 5: Administration, Bureaucracy and Numbers

  • Financial Reporting Systems, Continual Financial/Operational Planning and Measurement
  • Key Performance Indicators, Performance Measures, Functional Revenue and Costs Accounting, Return on Investment, Return on Sales – and Sales to Assets, Return on Equity, Financial Targets Against Operational Targets
  • Standard Financial Ratios
  • Modern Cost Accounting Practices; Cost Accounts for Labor, Material and Overhead, Standard Costs, Variance Analysis
  • Corporate Budgeting, Budgets for Cash, Income and Capital, Flexible Budgeting, and the Program Budget System
  • Market Forecasting, Sales Forecasts and Planning
  • In Company Pricing Structures – Same Producer Cannibalization
  • Pricing Formulas and Market Based Pricing Systems
  • Autonomous Functional Divisions and Inter-Divisional Relations Committees
  • Mass Production Coupled With Customer Satisfaction
  • Planned Obsolescence; Annual Product Changes
  • Management Efficiency; a Reliable, Efficient, Machine-Like Process
  • Executive Education Programs, Management Schools
  • Coordinated Control and Decentralization
  • Management by Numbers, Financial Controls and Finance as a Dominant Function
  • Dispersal of Company Ownership and Shareholders
  • Classic Organizational Theory; Scientific Management, Bureaucratic Theory, and Administrative theory
  • Hierarchical Structure of Power, Clear Lines of Authority and Control,
  • Rules and Regulations
  • Organizational Principles
  • Bureaucracy, Bureaucratic Principles, the Role of a Bureaucratic Official
  • Administrative Management Principles
  • Management Functions; Forecasting and Planning, Organizing, Commanding or Directing, Coordinating, and Controlling
  • The Seven Activities of Management – POSDCORB; Planning, Organizing, Staffing, Directing, Coordinating, Reporting and Budgeting
  • Short, Medium and Long Range Planning; Annual, Two-Year, Five-Year and Ten-Year Plans
  • Sociological Management and the Informal Organization
  • The Executive Function
  • Authority and Incentives
  • The Acceptance Theory of Management
  • Span of Control

Part I: Origins of the Design and Management of Work – Summary

  • The Prevailing Logic
  • A New Mental Revolution
  • Illusive Forces
  • The Need For Change
  • Escape
  • Beyond Your Mindset