Succeeding in an AI World (part 3)

 

In earlier articles I introduced the equation V = Q x A to illuminate the leader’s challenge in an AI world. How to harness the AI’s luminous potential while avoiding the disturbing risks? Today I’d like to go a little deeper.

The value of any intervention is a function of its quality and the degree of acceptance.

Business interventions typically entail novelty - a new vision, aspiration, goals & winning logic, or a new process, technology, way of working and/or thinking, or an innovation needed to solve a problem or fill an evolving need.

Value means something the CFO can point to on a P & L, or in the case of Innovation, validated learning toward filling a critical & unfilled customer need in an important market (Innovation Accounting). Quality means things like how clearly we’ve defined our problem & hypothesis, the quality & completeness of our data, depth of causal analysis, degree to which hypotheses, data & causes are validated, quality of reflection & pivots, how effectively the intervention is deployed, communicated, and sustained. Acceptance means do people like it, use it, trust & believe in the intervention – and in you as its sponsor & leader.

AI can be great for Quality but is toxic for Acceptance. The public backlash against AI & Big Tech in general has gone mainstream. Pixar’s Toy Story 5 for example, carries a strong anti-Tech message - the toys lose their jobs to AI. It’s all there, the screen addiction, loneliness, and phoniness of the chatbots. So, even Tech has joined the anti-Tech crusade. The deep-rooted & growing revulsion to Tech in movies, music, journalism and fields, is well documented by culture critic, Ted Gioia, and many others.

So, what are key drivers of Acceptance? Excellence – the excellence of the humans who propose, develop, and deploy the initiative. By excellence I mean integrity, capability, competence, decency, honesty, courage, tenacity, warm-heartedness, experience, and vision. In fact, I am consciously evoking the ancient Greek word arete.

Here’s my rationale: I have experienced multiple business transformations as a manager, engineer, advisor, and director. The common thread in all successful initiatives has been the excellence (arete) of leadership. In other words, leadership is the spark, killer app, and driver. Leadership animates Acceptance and Quality, and ensures the initiative creates Value.

I experienced all this most intensely as a young Toyota manager in the 1990’s. Toyota was expanding around the world and deployed their best & brightest executives and senseis to facilitate this massive & risky investment. Decades later these facilities remain world-beating paragons of Safety, Quality, Delivery & Value. Why did my colleagues & I embrace the Toyota Production System and it’s complex & often counterintuitive methods & mindsets? Excellence – the excellence of our leaders & senseis. We sensed their excellence and did not want to let them down. We trusted them and knew we would do right by them. They had our trust, loyalty, respect, and affection – and for me, they always will.

In summary, our AI interventions are governed by the simple equation above. Most initiatives that focus on Q at the expense of A, fail. Use AI to enhance Q but understand the limiting factor. If A is zero, then so is Value. In future articles I’ll address AI & Q, and Excellence – what is it, how do we grow it, and how do we scale it?

Best wishes,

Pascal Dennis         E: pascal.dennis@leansystems.org

Stratex Fundamentals – What Drives Achievement?

What drives StratEx achievement & how do we sustain it? Do the StratEx lessons I learned as a young Toyota engineer & manager still apply?

 What's in it for them?

I grew up in the ‘90’s on a steady diet of the Toyota Production System (TPS). Our compass through almost continuous expansion was a business system called ‘Hoshin Kanri’ or Strategy Deployment, which I’ve written about it extensively. The past decade my practice has evolved toward ‘ambidexterity’ and fields like financial services, consumer goods & Tech. My hypothesis: those will prosper who can both protect the core business with OpEx and ignite new growth with Digital methods.

So, do the TPS methods & mindsets I learned as a young engineer & manager apply? Yes, provided you translate & adapt them for each industry. (Does anybody care about how we did it at Toyota?) With that prologue, let’s see if we can answer the questions posed above.

What Drives Stratex Achievement?

Whether your focus is protecting the core business with Lean/OpEx, or igniting new Growth with digital methods, our motive force is smart, capable people continually solving problems (aka ‘Total Involvement’). This is the ‘wind that fills the sails’ and it has two parts: a) good people, and b) good systems that let them work with minimum hassle.

‘Good People’ entails answering the following questions:

·       What qualities do we need in our team members? How do we hire for those qualities?

·       How do we develop their skills? (Subordinate questions: What are the needed skills, skills gaps, and with what methods do we close them?)

·       How do we reward them & recognize their achievements?

·       How do we sustain a physically & psychologically safe workplace?

·       How do we engage team members in continuous improvement and/or innovation work?

·       How do we motivate them to continually improve themselves and help us to improve & innovate?

Our People management system must answer these questions in simple, concrete terms.  For example, ‘engagement’ means doing things such as Quick & Easy Improvements, Root Cause Problem Solving, and Innovation Sprints that generate Value which the CFO recognizes.  Filling out surveys or attending Senior Leader talks, while helpful for info-gathering, is not engagement.

‘Good systems’ means daily team huddles around team boards, a standard operating rhythm & huddle process at each level. It means a senior leader Obeya (Big Room, Control Tower, Cockpit) wherein the senior team addresses the big questions in a frank robust & visual way: What Should Be Happening?  What is Actually Happening? What are We Doing About It?  For leaders, what you do it what you get.

‘Good systems’ also means identifying & addressing blockers that hinder total involvement. These typically include bureaucracy, too many meetings, corrosive mental models (e.g. rewarding ‘busyness’ vs effectiveness), and perverse incentives.

How Do We Sustain Team Member Involvement?

We have to answer a difficult question: ‘What’s in it for you?’

Leaders need to explain why team members should go the extra mile & try to improve the current condition.  Does an answer like, ‘Because you need a paycheck’, instill passion & commitment?

Each leader has to reflect & answer this question in a heartfelt way.  Here the response of a leader I’ve been privileged to work with: ‘We want to win and be the best in our industry. We want to have fun & make money, and do right by our customers, team members & community. We want to invest in you & give you growth opportunities so you can help us to be the best. You’re going to learn leading edge methods, and you’ll have a job with us for as long you want one.  Your job may change, because we intend to keep improving. In return, you have to help us to improve, you have to be open & curious & energetic, and you have to tell us if something is not working and help us fix it.”

Best wishes,

Pascal Dennis         E: pascal.dennis@leansystems.org