What is a Self-Improving System?

 

What is a people network? Connectedness, shared information and reciprocity.  What does it look like? Short, focused, connected huddles around visual boards. Why does it matter?  A strong network is like a nervous system. Think quick response, adjustment and learning. If you pull it off, it’s a gold mine. So how do you build one?

Building a Self-Improving System.

Here are some key elements.

·       Clarity & alignment around Aspiration & Winning Logic. Each level and team translate the these into a tactics & metrics they track on their huddle boards.

·       A Big Room called an ‘Obeya’ (aka Control Tower, Cockpit) that serves as ‘mission control’. The Obeya answers the big strategy questions at a glance. What should be happening? What’s actually happening? What are the biggest blockers & what are we doing about them?

·       Information flows up, and support flows down. “Here's how we're doing, and here are the blockers. Can you please help with this one & that one, boss?”

·       World class problem solving – more to come on this topic in future posts

·       Clear roles: It’s understood that the team owns the problem. Senior leaders help remove the blockers that are beyond the team’s control

What are the enablers?

·       Simple visual standards for all important work

·       Repeatable operating rhythms at each level.

·       Visual management - at a glance understanding of what’s happening

·       Strong connections between teams in the form of Ok/Not Ok tests.

·       Clear rules of engagement such as:

o   Make problems visible – they’re gold

o   Warm heart principle. Hard on the problem but easy on the people. Remember the problem is usually in the process.

o   Respectful inquiry. Leave your rank at the door. Listen more than you speak.

o   Evidence-based management – no Zebras or Hippos![i]

 

Common Blockers

Common failures modes include poor (i.e. invisible, low quality, incomplete) information flow, lack of shared Purpose, and an overly rigid strategy deployment system.

Team Hassles: The ideal team size is typically between 5 & 9 people (e.g. Amazon’s famous ‘two pizza teams’). This sweet spot balances the need for diverse skills & perspectives against the communication & coordination challenges that plague larger groups. There are many other team-related hassles well described by Patrick Lencioni and others.

Information Hassles: E.g. Information that is incomplete, low quality or invisible. Team boards can be both analogue & Digital, but a messy analogue board is more compelling.

Lack of Shared Purpose: Have we articulated our purpose in clear simple language?  Can team members explain in their own words? Leadership is oratory, leadership is storytelling.

Dysfunctional Cultural Norms: Reciprocity means ‘you scratch my back, and I’ll scratch yours’.  Incentive structures obviously help but are not enough. Cultural norms around Safety, Respect for People, Teamwork and other core principles drive reciprocity.  Great companies provide continual nudges in this direction. Leaders at every level have a shared set of values that they reinforce through shared ‘ceremonies’.  Culture is what you do when nobody is watching.  Over time these shared routines and norms permeate you way of thinking and behaving.

Here’s an example from early in my career. The scene: my first day at Toyota, in the manager onboarding program.  Our instructor began by drawing three ovals, one at a time, and labelling each:

·       Oval 1: something for the customer & community

·       Oval 2: something for the team member

·       Oval 3: something for the company

My fellow trainees and I stared at the Toyota logo.  It’s a nudge I’ve never forgotten.

That said, please do not copy Toyota or any other company. Make a system that fits your company, culture and industry.  Weave in the fundamentals, run experiments and keep getting better.

Best regards,

Pascal Dennis

E: pascal.dennis@leansystems.org

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[i] Highest paid person’s opinion; Zero expertise but really arrogant.

How to Manage Watchers? Fukuda’s Parable in the Age of AI (part 3)

 

Watchers comprise the bulk of your team & are the key to sustaining your transformation.  If we can turn them into Rowers, we’re in business.  If they morph into ‘Quiet Quitters’, we’re sunk. Here’s part 3 of my series on Fukuda’s Parable, based on the book Andy & Me.

“How Will You Motivate Your Team, Pascal-san?”

I quote a revered mentor who once posed this question to a fledgling manager & engineer. I’ve been thinking about it ever since. Watchers neither take the oars, nor run away. They sit back & watch, waiting to see how the Rowers make out. Your job as leader is to demonstrate that the new ways of working are fun & rewarding, and to thereby engage the Watchers.

The argument goes something like this: Change is hard, but we have no choice. If we do nothing we’ll soon be obsolete. I’m proposing a Win-Win situation. We want to help you become smarter, more capable, and forever employable. And we want you to do the work that needs doing, and to help us improve.

If the Watchers see the Rowers having fun, getting results, and kicking ass, more & more of them will take an oar. If, by contrast, they see the Rowers having a tough time through lack of visible senior level support, they’ll stay on the sidelines thinking, ‘This too shall pass.’

Do not give the Grumblers a platform – that just distracts the Watchers. It’s best to either ignore Grumblers or to apply the methods of Steve Jobs or Jack Welch, which I described last time.

Quiet Quitters

Gallup polls since the pandemic suggest that quiet quitting is a growing phenomenon, especially among Gen Z. ‘I’ll do exactly what the job requires & no more.’ They won’t stay late, show up early or show up to non-mandatory meetings. Are all Watchers, quiet quitters? Not in my experience. That said, I know senior leaders are keen on Agentic AI at least in part because of frustration with quiet quitters. Other leaders respond to ‘quiet quitting’ with a tit-for-tat approach called ‘quiet firing’.  In other words, we’ll give you less & less responsibility and attention till you go away.

Engaging the Watchers

I am of the ‘everyone-deserves-a-chance’ school of leadership. The leader must lay out a Win-Win scenario and invite people to take an oar. Leaders must be storytellers & orators and must embody the organization’s core Values. Develop a management system that makes visible ‘What Should Be Happening’ versus ‘What is Actually Happening.’ Embed cultural ‘nudges’ in your operating rhythms including Strategy deployment & execution cycles, leader Obeya (Control Tower) meetings, management walks, and daily team huddles. Your Root Cause Problem Solving & Innovation processes are also an excellent source of such tacit knowledge.

Get Results Fast

Prove that ‘this stuff actually works’ with quick wins on thorny problems. I advise my mentees to create stages, forums, and ‘shows’ wherein your stars can shine. These can be Shark Tanks, Innovation Councils, Pitch Competitions, Problem Solving Fairs, and the like. The point is to create momentum by showcasing quick wins and thereby to turn Watchers into Rowers.

Be tough, be fair. Set up a Win-Win and give everybody a chance. If there are Watchers or quiet quitters still refuse to engage, that’s on them.

Best wishes,

Pascal Dennis         E: pascal.dennis@leansystems.org

How to Handle Grumblers? Fukuda’s Parable in the Age of AI (part 2)

 

So how should we handle Grumblers? Some years ago, I introduced a transformation metaphor in a book called Andy & Me. The metaphor & underlying principles hold true & help us navigate intense turbulence. 

The Most Common Mistake

Grumblers comprise 10 to 20% of the organization. They cross their arms & resist any change. ‘This is sure to fail,’ they mutter. ‘The old way was perfectly fine.’ Common mistake: paying attention to Grumblers, giving them a platform or trying to understand or change them. The truth is, you can almost never change them, and if you do, it’s rarely worth the effort. [Caveat: on occasion, you’ll discover a Grumbler who is capable & cares deeply but has been thwarted by poor management. Such people can be diamonds in the rough.] How to manage Grumblers?  Here are noteworthy approaches.

Steve Jobs, Jack Welch & Toyota

No bozos ever! Steve Jobs’ wise & witty aphorism informed Apple during its glory years. The key, Jobs suggested, was to screen Grumblers & other bozos in the recruitment phase. (‘No bozos ever’ is a robust philosophy in all areas of life, no?)

Cull the bozos! Jack Welch’s philosophy centered on candid feedback, aggressive talent differentiation (the "20-70-10" model), and empowering CHROs to act as the "Head of Player Personnel" to build winning teams. Welch famously declared that CHROs were as important as CFOs.

Everybody deserves a chance. This is Toyota’s philosophy, which I absorbed as a young manager & engineer. This can work well if you have an excellent recruiting, training & development systems, as well as a fair process for culling Grumblers.  (Companies with strong team cultures often let teams handle difficult internal issues & generally support the team’s personnel decisions.)

My Preference: Ignore the Grumblers

My preference is to ignore Grumblers. Do not try to argue, understand or provide them with a platform. This may seem counter-intuitive.  (Shouldn’t we fix our weak points?) Grumblers are an energy & creativity sink. Focus on developing & rewarding your Rowers.

Proviso: If a Grumbler is actively sabotaging your transformation efforts, you must act.

Grumblers in the Age of AI

Here’s a common scenario: We’re working on a major improvement or Innovation project. We have access to AI agents & related tools, but a minority resist new ways of working.  Some are overt in their resistance.  (I have a PhD in marketing. What is this Growth Hacking stuff?). They’ll openly argue & actively resist any change.

Other grumblers are more subtle and play various destructive power games. Here are a few:

·       Blame game – (See what you made me do!)

·       Scapegoating

·       Withholding information

·       ‘Silly bugger’ (British slang) – wasting time, fooling around, or acting in an annoying way.

World class management systems make What is Actually Happening visible. (This is one of my priorities in any mentoring engagement.) You can run but you cannot hide.  Grumblers, game-players, fakers and the like are quickly exposed.

I advise my mentees to create stages, forums, and ‘shows’ wherein your stars can shine. These can be Shark Tanks, Innovation Councils, Pitch Competitions, Problem Solving Fairs and the like.  The point is to provide a showcase for your best and brightest. And added bonus is that Grumblers are exposed & usually neutralized by the bright light of reality.

More to come, stay tuned.

Best wishes,

Pascal Dennis         E: pascal.dennis@leansystems.org

Rowers, Watchers & Grumblers – Fukuda’s Parable in the Age of AI (part 1)

 

Some years ago, I introduced a transformation metaphor in a book called Andy & Me. Both the metaphor & book found an audience. Back then I was focused on helping to transform factories & supply chains. Nowadays, the scope is broader & includes C-suites & Boards, and the advent of Agentic AI & all it entails. The metaphor & principles behind it still hold true. The fundamentals do not change & every generation has to learn them. In this series of articles, I’ll explore the implications of Fukuda’s Parable for leaders of all levels.

Fukuda’s Parable

I first learned it from Gwen Galsworth, and I understand Gwen learned it from Ryuji Fukuda. ‘Change is a voyage’ the parable tells us. Here are the key elements:

Rowers, Watchers and Grumblers

The parable asks you to imagine a ship representing a company or a team. When a leader proposes a major change, employees in the organization will typically fall into three distinct groups:

·       Rowers (10-20%): These are the innovators & early adopters. They eagerly take up oars. They’re excited by the challenge, highly adaptable, and ready to learn new ways of working.

·       Watchers (60-80%): They neither take the oars, nor run away. They sit back & watch, waiting to see how the Rowers make out.

·       Grumblers (10-20%): These are the blockers. They cross their arms & actively resist any change. ‘This is sure to fail,’ they argue. ‘The old way was perfectly fine.’

Leaders need to develop specific tactics for each group.

Promote, Celebrate & Develop the Rowers

Developing & rewarding your Rowers is Job One. Some find this counter-intuitive.  “Shouldn’t we fix our weak points?”, they ask. This is a common mistake & cripples many a transformation. In fact, as we’ll see in later articles, we should ignore the Grumblers.

Price’s Law

Price’s Law tells us that in every population, N, half of the Value is produced by . Suppose your Design team comprises N = 100 individuals.  Ten people ( ) will provide 50% of the value. (Note: Lotka’s Law says the results are even more heavily skewed). You had better reward, celebrate and develop these folks!

How Do You Identify Your Rowers?

If we accept Price’s Law, leaders had better answer this question. The Toyota Management System (TMS) makes visible What is Actually Happening (WAH) – and this is one of its greatest benefits. You can run but you cannot hide.  Grumblers, game-players, fakers and the like are quickly exposed.

I advise my mentees to create stages, forums, and ‘shows’ wherein your stars can shine. These can be Shark Tanks, Innovation Councils, Pitch Competitions, Problem Solving Fairs and the like.  The point is to provide a showcase for your best and brightest. The focus can be Protecting the Core Business or Igniting New Growth (see my articles on Ambidexterity).

More to come, stay tuned.

Best wishes,

Pascal Dennis         E: pascal.dennis@leansystems.org