Irving Wladawsky-Berger [IBM]

Advances in science and engineering have enabled us to understand increasingly complex natural systems like those in physics, chemistry and biology. Some of them, e.g., the solar system, are relatively simple and predictable. However, a common thread across all of these disciplines — and many areas of knowledge over the past half-century — has been the understanding that such systems, while composed of large numbers of relatively simple components, frequently exhibit very complex overall behavior. Rather than seeing the universe as a mechanistic, deterministic, Newtonian clockwork, we now understand that most complex systems in nature are highly dynamic, and while their components might be simple, the fact that they are interconnected and continually changing makes their behavior essentially “emergent;”, i.e., unpredictable. Turbulent weather, chemical reactions and most systems in biology are examples of such complex natural systems.

With complex man-made or engineered systems, we can also translate our increased understanding into better designs through the development of improved tools, processes, analytical techniques, simulations and similar methodologies. For example, in the last hundred years we have made major progress in the engineering of physical objects like bridges, skyscrapers, automobiles and airplanes. Similarly, we have seen the designs of computers and their components improve significantly in the last twenty years, including microprocessors, PCs, servers, networks and software of all sorts.

Complex systems like businesses and organizations stand somewhere between natural and “classic” engineered systems, sharing some properties of both. They are clearly not “natural”; they are most definitely man-made. However, they are unlike bridges, airplanes, microprocessors and other man-made objects which, once designed and built, are pretty much done. Businesses and economies have to keep adapting to the changes around them and evolving, especially in times like the present when we are exposed to frequent changes driven by forces like the Internet, globalization, commoditization and deregulation. In that sense, they have more in common with natural systems – especially biological ones, – than with man-made physical systems.

Can you apply engineering design principles to a complex, dynamic, unpredictable system like a business, an industry ecosystem or an economy? I believe so. The study of these kinds of complex systems is now poised for some very important advances. For the last few years I have felt that we are at the onset of a technology-based business and organizational revolution with the potential to alter the shape of companies, industries and economies. It could have an impact on the 21st century as profound as the Industrial Revolution had on previous generations.

The rise of the Internet, the spread of open industry standards and the availability of increasingly powerful and affordable technologies are driving much of the innovation around us — in the same way that the advent of steam power and machine tools of all kinds were largely responsible for innovation during the Industrial Revolution. But – the advances of the Industrial Age were grounded in a more mechanistic view of nature, which had inherent limitations. Our present understanding of emergent, complex adaptive systems is not only more accurate, but also much richer in innovative potential — including the potential for improving human institutions like those in business, government, health care, education and all other spheres of society.

If we look at how progress has been made in the design and understanding of complex engineered systems over the years, we see that a major factor has been the decomposition of such systems into their base components, which can then be put together in a variety of ways. Similarly, the deconstruction of a business into modular components and the standardization of many of these business components are among the most important innovations enabling us to apply engineering principles to business. To this end, business design, analytical and simulation tools are becoming increasingly important. But the dynamic quality of a business significantly impacts how you apply engineering principles to its design. Its design is essentially never done.

Flexibility is paramount to enable the business to keep up with the necessary changes and continuously evolve. Productivity and efficiency are very important so the business can stay competitive, which implies that its processes must be improved frequently, using tactics such as automation and outsourcing as appropriate. The unpredictable nature of business means that real time information must constantly be gathered and analyzed to anticipate both competitive opportunities and potential risks. When market environments change as rapidly as they do now, previously successful business strategies may no longer work, so the business needs to keep looking for opportunities to differentiate itself and innovate. In such a “Darwinian” climate, a business that does not adapt and change runs the risk of becoming marginalized or extinct.

More than ever, we need science and engineering to help us advance, but in addition, since the business needs to be in a constant state of analysis and re-design, we also need to be very sophisticated in the management and operation of the business. That is why one needs a new, interdisciplinary approach to these new kinds of complex, continuously evolving systems. Beyond science and engineering, we need solid management and industry knowledge, as well as a good understanding of the socio-political issues affecting the business. In the last few years, a number of universities have established such interdisciplinary research and educational programs like MIT’s Engineering Systems Division where I am personally involved as visiting professor.

The opportunity to apply science, engineering and management principles to complex systems like a business and similar human institutions is truly one of the most important and fascinating endeavors ahead of us.

The power and problems of collaboration.

‘A discourse on the obsession of meetings and the power of the new machinery for collaborative thinking’. By John Caswell

So here goes. We would all say that collaboration is good for us. Maybe we need to meet and discuss the plan of how to go forward. To innovate. To create new ideas. To solve a problem. To get ready for some big thing. Let’s have a meeting.

A favourite soapbox of mine. ‘Meetings dear boy. Meetings’. But hey, what are the alternatives I hear you shout. It’s good to meet and avoid e-mail conversation now and then. Right? It’s how we do things. So alright let’s do another meeting. Soundtrack goes like this. “Can you run that one by me again? Another meeting? To discuss what? Didn’t we talk about that already? 6 times? This month….”.”Who doesn’t get it?”. OK the meeting starts and then it goes like this. “So as I said in the last meeting…” “Let’s get that deck we used in the last meeting…”. “So who took the action to do that then?…”. “We talked about that before….”.”Who typed up the notes?…”. And…..”What actually happened?”…

Why is it that meetings tend to contain that hell of presentation on presentation, flip chart madness, no-one really wanting to be there and those random scribblings that some poor sausage gets to type up for the gratification of no-one. Yes I know they are not all like that but far too many are and they are in turn caused because someone somewhere needs the answer to something or some objective, however isolated needs to get met… My big gripe is what on earth does this process to for innovation and collaboration? What does it do for thinking? Where do the ideas go? Idea heaven? I’m suggesting that we need to understand and embrace all the moving parts of the organisation to have better meetings and optimal outcomes. We can only do that by increasing the context within which we all think and find better ways of developing the outcomes. It is super important to improve the experience and outcomes for all classes of strategic work and designing better experiences is also at the root of all this. We found that its good to do this with smart people, visual tools and some smart techniques to provoke thinking and collaborative teaming. We do this because we desperately need to improve understanding, get at faster analysis (of current realities) and then it’s critical to communicate and leverage this new knowledge to better arrive at a new future.

So what might be the basic ground rules for these better meetings?

“Men have become the tools of their tools…” – Henry Davis Thoreau

ONE: A neutral Agenda. “The only reason we don’t find solutions to our problems is because the answers interfere with our concepts…” Samuel Lewis
“We’ve all been frustrated with the lack of ways and means to solve the right problems right? Our clients get inundated with prejudiced and well meaning expertise. They lack the time or a 10,000ft view and so they often solve superficial problems rather than the underlying causes that need digging out. We need space to think properly and facilitation designed to take everyone along in a logical and engaging process and get at the real imperatives of the business”. Get facilitators who aren’t selling anything.

TWO: Create a frame within which folk can see and think. “You are rewarding a teacher poorly if you remain always a pupil…” Friedrich Nietzsche
“Clients want create a better future, launch into new marketplaces and work better as leaders. Leaders need to understand what are their choices, what smarter business processes will get them singing, explore new areas, consider all of the alternatives, collaborate with their partners or themselves better. Teams want to ensure they have done everything to improve performance, to differentiate themselves in whatever way they can, understand where they are going wrong, understand better what they might do next, remove confusion add inclusion, innovate, cultivate and communicate”. We get a kick out of that”.

THREE: Make the rule clear. True Team. No one is right or wrong. “Teamwork is a harder way of doing the work…” Ralph Ardill
“Digging for value isn’t a solo act of genius; it’s not Leonardo in his sun filled workshop sketching a design for a helicopter. It’s more an act of discovery, discovery in the sense of a bunch of people getting on the same boat and sailing west not sure if they’re going to fall off the earth or find the Orient. True discovery is an act of standing on the shoulders of others. Columbus didn’t invent the compass, the sextant, or the sail, yet he used all of them to find the new world. Similarly, we need to stand on the shoulders of our own team members, outside resources, and the work of others (best practices, other practices, etc.) to create the way forward. The fact is, most “discoveries” in business are less like invention and more like discovering that something that works in a completely different application can be adapted to work in your world”. Make a difference and stop with the in-industry best practices. OK?

FOUR: Wisdom and Experience. “When ideas fail, words come in very handy…” Goethe
“We’re big, big fans of the idea of “bringing the smart people to the problem.” So much of traditional consulting and staff work occurs off line where the scope can slip and change, time can slip by, etc. It’s not like workshops are magical, but the software industry for one has proven the value of JAD (Joint Application Development) or RIP (Rapid Implementation Planning) sessions, locking a bunch of smart people into a room for as long as it takes crack on a tough problem and figure out a way forward. We know from experience it works. Keep people locked in for a couple of days and a lot gets done. Let them out and the same piece of work takes weeks or longer. If the work product is better for all that time and that’s a big “if” it’s not usually better in proportion to the amount of time that’s gone by”. Do it properly.

FIVE: Intervene and cause an event. “Argue for your limitations and sure enough they’re yours…” Richard Bach
“It’s sometimes useful to think of an organization as a series of trajectories; energy vectors that are either trending up, flat, or down. Sales or profit growth would be one. Team member engagement might be another. Customer satisfaction would be yet another. Left alone, these energy vectors will flatten and then head down: they are not self propelled, though they sometimes feel like they are self guided. Leave enough of them alone and the gravity will be too much and they’ll drag the rest along with them. Conversely, get enough air under a couple of these vectors and they’ll pull the rest with them”. “The difference in trajectories on the plus side the difference between what it is and what it could realistically or reasonably be represents the concept of the “win premium”. You might not achieve it, but that’s what you should be playing for. So win premiums equal “wind in your sails (or sales)” premiums. Covering a “win gap” starts with making quality decisions in the face of a fair amount of uncertainty. You have to ask the right questions. You have to consider a solid range of alternatives (there is no one way to get there). And you will have to make tough trade-offs because your resources are always constrained and there is no sure thing here. And then you have to execute”. Deep thinking and proper planning.

SIX: Collaborate to win. “Opportunities multiply as they are seized…” Sun Tzu
“Make an open space that allows for sharp thinking on creating value to come to the surface, be recognized, and get implemented. Experience shows that if you were to make a list of the 20 things you admire most about how a competitor does business, someone in your organization would be able to say, “I/we thought of that years ago but nobody had the guts/vision/whatever to do it.” So liberating value starts with a strong dose of willingness to “hear the truth” about the way things are really getting done followed by strong leadership around “stay, stop, start.” Bring the Smart People to the Problem: Organizations are many things, but they are certainly heterogeneous distributions of talent. That’s a lot of words for saying you have some bright people in there somewhere. Most organizations have access to some very bright consultants and colleagues. There is plenty of talent if you’re able to recognize it and smart enough to give it a chance at your problem”. And before you start…

Aligning on what ‘collaboration’ as a working definition means.
What are the major attributes/triggers of collaboration capability and development in the enterprise?
How does the organization develop a global collaborative capability strategy to achieve growth and innovation.
What are the enterprise risks of not having a collaborative risk assessment lens?
Delivering the metrics and measures of the Win Premium (the value of speed). So we know when we are making progress.

SEVEN: Structure the thinking. “You need to structure the race, and you need a plan…” John Smith
“We love the idea of RIP sessions (think workshops) in particular: Organize them around specific themes (sales, distribution, asset management, HR, etc.), opportunities, trouble areas etc. Four, five, ten workshops. Whatever it takes. Get at them quickly. Work in parallel (or at least serially/rapidly). Consider doing them all at once in the same facility or even same room (more on that in a bit). Train the teams in decision quality, six sigma, or some similar schema for attacking problems and organizing strategies and recommendations. Give them a template. Give them facilitators, black belts, whatever. Make it possible for them to work productively vs. flailing around trying to figure out how to work. Have the idea that in six weeks time you’ll have a bunch of these RIP sessions done with recommended alternatives programs of work ready for initial sign off by the Executive Team. And that would be the outer limit of the time you want to elapse on this. Implement a dialog decision process to manage the check in process. Set tight time frames (100 days to glory). Hold people accountable. Change the values/metrics to reward the new vision, not the old way of doing things. Put political muscle behind getting things done. Do this now”.