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Diagnosing the system for organisations. Stafford Beer. Book recommendation by Stephen Parry

Diagnosing the system for organisations. Stafford Beer. Book recommendation by Stephen Parry

beerA great introduction to systems theory, the system modeling and characteristics devised by Beer are very simple and useable. Makes you think about the organization in a wider context being influenced by external and internal forces and describes methods for distinguishing between the two. I recommend studying this book, and persisting with its ideas, fully aligned with the concept and management practices of the adaptive-lean enterprise

Diagnosing the System for Organizations (Classic Beer Series)

 

Collection of A3 thinking related tweets from Stephen Parry

Collection of A3 thinking related tweets from Stephen Parry

I was recently preparing course material for an executive coaching program to develop A3 thinking within the management team. I found it difficult to put over very quickly the different behaviors and thinking Adaptive Lean and particularly the A3 thinking process brings about. Then I hit upon the idea of going back through all my tweets and collecting those related to the A3 thinking process. Feedback from the management team was positive and the collection brought greater insight to the coaching they received.  In the interest of sharing and promoting better management thinking here is the list. Please add your own as well.

 

 

thinking and feeling

A3 Thinking related tweets from Stephen Parry.

Trying to understand adaptive service from its parts is like trying to comprehend cakes from studying eggs, flour, sugar and fan assisted ovens.

There is a world of difference between helping people to see and telling them they are blind.

A3 Thinking is ALL about developing intelligence, not processes, methods or even solving problems.

You do not need eyes to see you need vision. Anon

Not having time for improvement is the biggest business case you can make for improvement. So stop using it as an excuse not to improve.

If you don’t have time for improvement it’s because you did not spend any time on improvement.

Thinking you can learn A3 thinking from a book is like thinking you can learn to drive by reading the Highway Code.

Define problems in the terms of the problem, NOT in terms of the solution.

At work, everyone thinks they know what the problems are, few know the causes fewer know how to solve them and fewer have the courage to try.

Transformation program’s that start with a solution, usually justify and define the problem through the lense of the solution

In companies, most people can tell you what’s wrong, fewer people can say why it’s wrong and even fewer know how to right the wrong

Bad management, competition without cooperation. Getting a bigger slice of the pie, but not making the pie bigger!

Management by walking around is not the same as going to gemba, you need to know what questions to ask, and stay long enough for an answer.

Your low hanging fruit has been taken by your competition a long time ago, you just haven’t noticed

We are being ruined by best efforts directed the wrong way. We need efforts directed by a theory of management. Deming

Zero defects and meeting specifications are not good enough, it’s how the system works overall that matters. Deming

If you can’t change the people change the system.

In today’s world you not only have to think outside your box but you must work outside your box

There has to be a clear line of sight between ALL the work you do and customer value

you can’t map the value stream unless you first know what value looks like from the customers perspective. 1st principle

Cherry picking always leaves you with sticky fingers!

90% of the Value Stream Maps show just the local departmental processes. You then optimise locally and make the value stream WORSE

If you measure your customer experience using averages don’t be surprised to find yourself delivering an average customer experience

Evolution is to blame, human mind wired to see patterns where there are none and favour correlations and false positives.

When a wise man points to the stars only a fool would look at his fingers. Anon

Consensus often creates a false sense of security and is no guarantee of being correct.

Creating choice, freedom and the power to do what matters creates change, nothing else.

Do not desire the wish to believe, rather foster the will to find out. Anon.

Sometimes the best you can hope for is lighting a small candle in the darkness, so others have the choice to stay or move forward.

Acceptable ideas are no longer competent and competent ideas are not yet acceptable. Stafford Beer

Even a fool knows more about his own house than the wise man who has never visited.

First you must open minds before you can open eyes.

Absence of evidence is not the same as evidence of absence. Anon

Those who complain about reductionism don’t really know what it means. -its to simplify theory to what works as a predictor and not beyond –

You can’t predict the action of water by studying its molecules, to do that we need another order of analysis that is fluid dynamics.

Often with patience, you can prise open closed minds to a new reality, but only if the mind is not welded shut by self-delusion.

Driven by open-minded curiosity, exploration, the joy of understanding, and the wonder and mystery about what we don’t yet know.

There is a world of difference between systems-thinking and building a Thinking-system.

Systems-thinking problem solving and building a thinking-system require very different levels of knowledge.

Problems start when open mindedness slips into empty mindedness.

Sure sign of management failure is reorganising management structures around themselves instead of reorganising the work around the customer.

People don’t join up the dots? Well sometimes they are just dots, don’t fool yourself into thinking the dots are joined up.

True, Science does not know everything, that’s why we have science, and it knows an awful lot more than anything else on the planet.

Try to argue as if you think you are right, not know you are right.

‘It is not that there are no certainties, it is that it is an absolute certainty that there are no certainties’ Hitch 22

Finish starting and start finishing.

Lean-six sigma is the very worst of both worlds.

‘what can be asserted without evidence can be dismissed without evidence’

Changing the system is like changing transport, don’t ask a train driver to think like he driving an aeroplane and expect him to take off.

Progress is better than perfection.

Perfection is the perfect lie.

Perfection can only be measured against purpose, which can gradually change. So cut out perfection and always strive to stay on purpose.

Everyone wants to go to heaven but nobody wants to die.

How to lose your best knowledge workers: ensure the org is not committed to learning. No time to read, learn, share, discuss, improve.

The fuel of the adaptive  lean enterprise is trust, transparency and integrity.

Education is as much about revealing your level of ignorance as the acquisition of knowledge.

Data and facts from the customers perspective puts everyone at the same level on the org chart

When in power its easy to exercise power, but it takes real power to admit weakness.

Often people resist change because it robs them of something to complain about.

It is profoundly illogical to think you can change your organisational culture using your current organisational culture!

Silo thinking is an OUTCOME of someone designing silo organisations measurements, targets and budgets. Fire the designer. Don’t blame the staff.

When you have mastered the real A3 thinking process, you have one of the best Baloney detectors man can devise.

Management focuses on what they can control leaders focus on what needs to be influenced.

‘Science is like a blabber mouth who ruins a movie by telling you how it ends’ Ned Flanders, The Simpsons

Leadership is the art of creating possibilities in the face of reality. Quote Sense and Respond Book

 

 

 

 

Learn Lean by doing? not if its swimming.

Learn Lean by doing? not if its swimming.

I was recently delivering a seminar on creating a lean climate, and telling people that trying to intellectualize the various lean components in order to understand and appreciate adaptive-lean was futile, it was like learning to swim without water.

I have used this analogy for many years. So you can expect my surprise when a student from Denmark shouted out – ‘But you can learn to swim without water, well at least that’s what they were teaching pupils in Scandinavia!’

There followed a brief conversation of disbelief on my part and then I asked him to prove it… so we googled it and sure enough he was right…..  See what you think, please share your views……

Here is the article in full.

Students must learn to swim far from the water

School swimming lessons have been cut for 20% of the country and in other areas replaced by tørsvømning in the classroom. Danish Sports Association fear it will mean more drowning’s.

Breaststroke is trained on the tables in the classrooms. Or on the floor.

Tørsvømning is beiswimmingng given to school children in 20% of the municipalities where it has ditched the traditional swimming lessons, according to a study by University of Southern Denmark.

Tørsvømning is the only option some schools have to teach swimming where the school does not have a swimming pool or where the school has no money to spend on bus transportation. “But we live in a country with 7.500 km coastline. It is basically very important that we learn to swim”says Pia Holm Christensen, director of the Danish Swimming Federation.

She believes that education and safety precautions can easily be taught in the classroom, but swimming skills are impossible without going into the water.

The Danish Sports Federation expressed the same concern. “To learn to swim without water is like trying to learn to ride a bike by reading about it in a book. It cannot be done. We fear that the cuts will mean that we will see more drowning accidents in the future, when the Danes do not have basic swimming skills in place, “says Steen Dahl Petersen from the Danish Sports Federation.

Rescue and Lifesaving a Critical Education Goal.

Though schools in a fifth of the municipalities cannot find the resources to send students to traditional swimming lessons, they must continue to teach swimming. The ministry’s so-called ‘Shared Goal’ for primary schools is that children should learn rescue and lifesaving. And so now they teach tørsvømning. “Of course they cannot learn how to rescue or to save lives. You can talk to them about common sense and precautions when on the beach” says Pia Holm Christensen.

“We probably would reintroduce swimming lessons starting next school year. We are working on the on-going budget negotiations. It was a bad decision to cut swimming lessons away in his time, “says Haderslev Socialist mayor Jens Christian Gjesing.

 

 

Living Supply Chains Book Review by Stephen Parry

Living Supply Chains: How to Mobilize the Enterprise Around Delivering What Your Customers Want (Financial Times Series)

 

Living supply chain or adaptive supply chain?

This is an excellent book for the knowledgeable practitioner. It is crammed full of diagnostic tools designed to get you thinking about how adaptive your own value chain is or could be.

There are some assumptions behind this book,1) Most organisations have the desire to create an adaptive supply chain, 2)That organisations are ready to abandon their conventional wisdom in order to find out what their customers really want.

If these assumptions can correctly be made about your organisation then this is book is a must for you.

If you are trying to make a case for your organisation to embark on this course then the book does not provide the evidence you will need or even provide a theoretical framework with which to start. Hence this book is really for the professional change agent working in conditions where you already have senior management commitment.

As a book that reinforces John Gattorna as a skilled and knowledgeable authority on the subject of supply chain improvement it is very successful. It is clear from the book that for the less knowledgeable person then you need the help of someone like John to get you started.

Well written, good read, great source of diagnostic methods, a must for the supply chain improvement practitioner.

Run experiments not pilots.

Run experiments not pilots.

In Lean we start by not knowing the solution, in Mass you only start once you ‘know’ a solution. That’s why we run experiments not pilots.

Why do we need to stop running pilots and start running experiments instead?

Well, the message you give as a Lean practitioner to employees and to managers is that pilots are almost finished products, then they get very upset when they find that you don’t have all the answers and a detailed plan on how to implement them. They even accuse you of being incompetent or wasting their time.    ‘this is all too wishy-washy. Just tell me what I need to do, you can be so frustrating’. They often say.

This is usually the first reaction from people who are being asked to think for themselves maybe for the first time.

We ask about how they do their work, it’s design and to think about the end to end business process and customer outcomes,  this is all very strange for them.

These questions are not appropriate  in the mass world except maybe at the senior management level but they cannot answer these questions- the mass design has separated them from the workplace and the data.

Lean highlights the illusion of control provided by Mass and outlines a better approach to gain and maintain control by assigning responsibility and accountability at the employee level.

So how do we start conditioning managers and employees to a shift in responsibility – by running experiments together to learn together to find better ways to meet our customers purpose together.  There is no us and them.

Data and facts from the customers perspective puts everyone at the same level on the org chart.

The purpose of experimentation is to test management and employee assumptions and to find answers and solutions to the many questions they have.

One other important feature of running experiments is that we are openly saying ‘none of us know for sure the answers but we want to surface and solve our problems together’

Call Centres: All Businesses Have costs but Waste is Optional

Call Centres: All Businesses Have costs but Waste is Optional

By Stephen Parry
At the risk of being accused of stating the obvious, a well-known research company has demonstrated that call centres resolving customer issues at the first point of contact will increase customer satisfaction.

This influential report has fuelled the drive by many companies to increase their first-contact resolution performance through the introduction of call eradication or call avoidance schemes. All well and good, you might say. But hang on a moment. The research results may seem obvious but everybody appears to have missed a very important point. Does anybody truly know whether these first-time resolutions are actually creating value for the customer or are we unintentionally creating cheaper, faster, neater forms of waste?

The research is fundamentally flawed, because it fails to consider the customers’ perspective of value, and the company actions are quite literally the wrong solution to the wrong problem. Why? Because our own findings have demonstrated that in many call centre operations, as much as 90% of the demand made for the service is actually waste that has inadvertently been created by the organisation itself. Fixing things which should not have gone wrong in the first place is not creating value for the customer. And to add insult to injury many companies are calling customers to let them know in advance that they will fail to meet their commitments. Again this seems reasonable until you dig a little deeper. We all accept things can occasionally come off the rails so calling customers in advance to let them know may be thought of as proactive and ‘good-service’. However when you look at the army of people many call centres employ on this task, it reveals these ‘occasional’ incidents for what they are, predictable failures of a badly designed and unorganised service. A service where incidents are allowed to proliferate leaves front-line staff with but one option, to try and tone down the situation and pacify the customer. This is anything but proactive, it’s institutionalised waste.

There is also a human cost to these strategies. Research has demonstrated that the biggest source of call centre staff turnover/attrition is created when staff are expected to continually calm down irate customers, it is a cost paid for by emotional stress. If companies design call centres around the problems of their own products and services, these operations end up as a mere corporate waste disposal units.

The Modern Call Centre is not designed to meet the needs of the modern customer.

Take a closer look at the costs associated with this type of approach. A conservative cost estimate of a call centre with 1,000 staff will be around £30m per annum, and anywhere between 40-90% of the calls handled by a typical call centre, add no value to customers. This means that businesses incur unnecessary costs of between £12m-£27m. It’s no wonder there is a drive to reduce costs through the use of automation or ‘off-shoring’ to low-cost labour markets, but again, this is the wrong solution to the wrong problem.

All businesses have costs, but waste is optional.
So, let me pose a few important questions: Do you have any idea how much value you create for your customers today? Even if you think you do, can you quantify it? And can you identify how much waste presently resides in your processes and how you could create value at no additional cost?

If you answered ‘no’ to any of the above, the likelihood is that you’re generating unnecessary waste with associated negative cost implications. The answer is to create a framework for defining what is and is not value from the customer’s perspective. To understand this we must examine the customers’ purpose, for it is the customer’s purpose which provides the one true definition of value, not the organisation’s belief. Once the customer’s purpose has been identified it becomes obvious what types of calls are valuable and must be resolved first time, and those which are waste to be eradicated.

This change of emphasis has a significant impact for the role of the contact centre. It is no longer about simply understanding the transaction, but is about seeking out a thorough understanding of the customer’s purpose within the context of the whole value stream. It really is a different type of organisation with a different purpose.

CORE Profile: A Purpose Framework
Most companies genuinely want to create value for their customers and sincerely believe that their customer-service operations are indeed doing that, but often they are simply restoring lost value caused by a failure to do something right the first time. Customer demand can therefore be classified into two types: demand that is essentially driven by the customers’ positive needs, and demand that is negative or remedial in its origins.

CORE Profile: Value definitions

Creation demand
Creation demand comes into a service organisation because customers want to understand how to optimise the functionality of their service or product, or how to obtain more of what they already have. Creation demand is not the result of something being wrong, therefore, such that customers have lost the value of a service or product, but rather the result of customers’ questions such as: ‘Which product is best?’ or ‘How can I get more out of my product or service?’ For efficient delivery, creation demand must be optimised (Womack and Jones, 1996). This is the type of demand that the organisation wants to keep, so the organisation needs to make it simple and easy for the customer to ‘pull’ service. Identification and analysis of how the end-to-end processes deliver against this demand type will indicate clearly which elements of the support structure could be improved, for example using tools for automation or web based assistance.

Creation demand is seen in many service sectors. Customers of a bank, for example, may wish to gain more information from their bank statements and transactional details, to understand how they could better invest their existing savings, or to find out in which countries they could use their bank cards.

Similarly, customers enquiring about their utilities may wish to set up a direct debit for payment or to ascertain how much the amount of their next bill.

Opportunity demand
Opportunity demand occurs when the customer wants something that is not currently offered. Most organisations will merely apologise to customers, saying that they can’t fulfil the demand, and will then terminate the transaction. In a customer-centric organisation, in contrast, it is critical to capture this type of enquiry: these can provide a rich source of ideas and data for new services or product lines. Opportunity demand needs innovation to create new services and
potential revenues need to be examined.

Consider as a simple illustration an independent burger bar. If enough demand is created for a specific burger topping, then the business can adapt very quickly and just add this topping to the menu so that it can now meet demand. If, however, several people request not burgers but pizzas, these customers present an opportunity. The outlet may not sell pizza currently, but over a period of time, in a completely unscientific way, the owner will recognise the
sustained demand for pizza. The owner may have ‘drilled down’ and even identified that these requests arise on a particular day of the week. When the demand reaches a significant proportion, the burger bar owner will offer pizzas

for a limited trial period. It may happen that there is little take-up, and pizza will then be withdrawn again. Or it may happen that the demand for pizza grows and eventually outstrips the demand for burgers. Having made an informed decision, the business may then swing around to become a pizza outlet rather than a burger outlet.

Restorative or Remdial demand
Restorative demand occurs when the organisation delivers unfit products or services, generating unwanted demand as a consequence. This causes customer dissatisfaction, resulting in loss of money, time, reputation and loyalty.

The work involved in correcting this situation is deemed to be restoring lost value. In the eyes of the customer, restoring value is seen thus: ‘You broke it, you fix it!’ Restorative demand needs to be removed by identifying and rectifying the originating cause, which may reside in other parts of the organisation.

Only in poorly run or unethical companies would you find revenue being generated against demand of this type. Restorative demand becomes a drain on resources, and ineffective organisations inadvertently generate between 40 and 90 per cent of the total customer demand in this negative way.

Here’s a golden rule: never automate this restorative demand. Automation locks in frustration for the customer as well as for the frontline staff whom the customer has to call repeatedly about the organisation. Support staff also feel disenfranchised because existing constraints prevent them from making any difference in this situation. The spiral
continues, with the customer becoming more and more disillusioned, which generates additional negative demand, and all the while the frontline staff feel powerless to change things.


External demand

External demand is failure generated externally by other agencies, institutions or companies. Organisations can generate revenue against this type of demand as long as it continues to present itself – that is, until a competitor (to return to the earlier example) fixes the road and removes the need to fix tyres.

External demand should be addressed by rethinking the environment that allows it to exist and by developing new solutions. In this context it is perfectly respectable to restore value, because the other things that are not working are

business is and whether or not it is totally dependent on restoring value as a the responsibility of other people. In fact, some businesses are set up specifically to handle this type of demand. However, organisations with this business model have to question the basis of their future: are the revenues that they are generating largely dependent on other companies failing to perform their duties? If so, what happens if those companies start performing well? This business model can be fundamentally flawed, depending on how exposed the revenue stream.

Download full White Paper. Avoid the waste but no the Value. from our Slide share site.

©Stephen Parry 2010 All rights reserved.