Missed opportunities for improvement represent a 20–60 percent chunk carved out of the bottom line. Scores of programs and projects that claim improvement but never materialize in the financials are a travesty. The Wall Street Journal reports that more than 60 percent of improvement efforts fail. But the biggest failure occurs in the minds of executives.
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The traditional approach is to get executive sponsors for improvement efforts. They say a few words and “throw their support” behind the effort. Then they return to their offices while the team toils to find some process to improve. The result is usually negligible or nonexistent improvement that is unsustainable—particularly because executives are quick to overturn improvement efforts with wrong thinking.
Because improvement efforts are pushed down to the front line and specific processes, the largest area for improvement—changing management thinking—goes unnoticed. Many areas that require executive self-reflection are completely ignored. They include:
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Comments
Missed opportunities in Management Thinking
"They have built their companies’ human pyramid for protection." While this may be true, an alternative explanation is that "They don't know any better." Consider an example from education: a child goes to school and is enculturated into the school system. As they progress, they decide that they might become a teacher. They go to college (a similar system with similar classroom expectations), receive their teaching certificate and go back into the classroom prepared to teach. If they teach the way they've been taught, are they building the classroom for their protection (to keep their job) or is it because they don't know any better?
A corollary to this is that, once someone achieves a management position in a system, they are reaping the rewards of that system. If they were to change the system, they would jeopardize their position in the system. It's hard to step outside of a "nurturing" system into something unknown when you don't know another way to be and are unwilling to lose the perks of authority earned through the system.
"They don't know any better"
I agree with your alternative thought. It was why we say "management is guilty, but not to blame" the system has indoctrinated their thinking. This is why I like the words . . ."brain enema" to describe what executives need to do.
All you say is true, but there is a better and proven way that is "safer than a known way" to quote John McConnell. The curious will move forward and the satisfied will continue to bury their heads - it is an individual choice.
You wrote that executives
You wrote that executives too often do not improve the obvious like "Standardization, centralization, and simplification efforts launched without evidence that they actually improve things." Centralization is a strategy that works in some instances when quick wins are needed. De-centralization can exceed expectations when each node can learn at its own pace what works and what doesn't. The result is not like machine learning models, however. It is untidy, and chaotic and requires much of that scarce resource -- management attention.
Standardization can prove itself but requires assumptions like a stable process. What about unstable ones? Markets change, you know. What is the executive to do when there is no workable business or market model to ponder? How can the executive know how the new change will affect the system using the unknown process? What if the executive standardizes on a poor process? Chicken-or-egg? Maybe standardizing is like driving a stake into the ground and the unstable process, tethered to it, will gradually stabilize. What is causing the instability? A good model with fidelity fine enough to see functions and malfunctions would suffice. Who is to make such a model? How will we know that it is correct?
How would you advise the executive on these issues?
Do they come from knowledge or plans?
The question about standardization, centralization, and simplification has to do with coming from knowledge instead of assumptions (like copying or best practices). Your key to your comment is "some situations", not all situations.
Markets, like demands change all the time. Standardization does not allow absorption of variety. The instability of a service system is a function of this variety in demand. Assuming that standardization is a good place to start is misguided. Demand and customer purpose are always helpful in understanding what to build or improve.
Questions and approaches
Wondering in your experience what questions an executive may ask themselves and others on the way to a "normative experience". Does such an experience require active involvement in the work? Interested to hear about recent, real cases (with suitable renaming of course).
Not being an executive I am wondering how one might well awaken their interest.
Awakening an Executive
An executive has to want to be awake and have some insight that things are not optimal despite their power of influence, bonus and other factors that make it harder to be curious. Most executives already know that their systems aren't optimal, it takes guts to do something about it.
Case studies are a slippery slope, because many readers will say "I don't have that problem" and move on. The truth is they all have many types of problems that may morph themselves into different forms or different ones. The fear is always copying. Each system has different problems, it's the nature of systems. I will digest your comment as the editor wants my next column to have case studies. But the bottom-line is that you have to go to the work.
Which is a good segue to an executive being in the work. Like bond prices and rates there is an inverse relationship . . .The less time executives spend in the work, the more bad decisions that are made. I am yet to see an executive walk away from a normative experience without having changed their mind about something in their system.
Thanks for the feedback.
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