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Have we reached peak SI

2011/08/03 in Business-Technology | 2 comments

Have we hit the peak for systems integrators (SIs) (just as we appear to have reached “peak oil”), and it’s all downhill from here? While SIs are doing well at the moment, structural changes in the IT market suggest that the long term forecast is not all sunshine and roses as some pundits are predicting. With IT spend migrating from IT departments (the SI’s traditional buyer) into the lines of business, the ongoing shift to smaller projects delivering on-demand (rather than on-premesis) solutions, and the replacement of traditional support arrangements with outsourced and managed services, it’s hard to see how SIs will continue to grow when demand for their services seems to be tipping into decline. Globalisation, software as a service (SaaS) and cloud computer are reconfiguring the IT landscape and SIs look like they will be the big losers.

Predictions for the continued growth of the SI market are based on the understanding that companies are consuming more IT today than they were yesterday, and the assumption that increased IT consumption will result in tidy profits for SIs. Predictions are a funny things though, based as they are on historical trends. Guess that the market will continue to rise when you’re in the midst of a bull market and you’ll be right, most of the time. That is until something happens, something you didn’t anticipate, something that catches you unawares. The assumption that SI revenue is tied to IT consumption might no longer be true. New tools such as SaaS and cloud computing are enabling line-of-business leaders to step around the traditional IT department and engage with technology directly, bypassing the SIs traditional relationships in IT and providing them with fewer opportunities to sell their wares. At the same time the shift from on-premises to on-demand solutions – solutions which the business is happy to rent rather than own – is slashing the effort required to install, configure and integrate these new solutions, often by as much as seventy to eighty percent. On-demand solutions also have much lighter support needs relying on self-help wikis, users forums and power users, leaving the SI with little more than a small help desk to manage. With only limited access to this new class of IT buyer, dramatically smaller projects, and lower support revenue, the SIs role as IT enabler seems to be in decline. All good things come to an end though, and you usually only realise that the end has come after it has already passed. IT consumption might be going up, but there’s a good chance that SI revenue could soon be going down at the same time.

SIs are fundamentally sandwich shops[1]. When we don’t have the time or money to maintain our own kitchen or make our own sandwiches it can be more efficient to head over to the local sandwich shop to pick up what we need. Their margins are thin and revenue is largely tied to the size of the sandwich you just bought, so they’d really like you to buy a larger and more expensive sandwich. (Notice how sandwiches have grown so much bigger over the years, and everything is now gourmet?) And, of course, pre-made sandwiches are always a lot cheaper than special orders. This sandwich shop model is something that was established early on in the history of business IT. How else could companies afford to access the rare (and expensive) IT skills they needed to create all the systems they need? This might be a payroll system, or stock management, sales pipeline reporting, or the dreaded enterprise resource planning (ERP). Consuming IT used to mean hiring an SI to build and integrate something for you.

The world has changed since then. Back when I started in the industry my home computer couldn’t hold a candle to the beast I was given at work. Today, however, my shiny new 17″ MacBook Pro makes the locked down Windows XP laptops I’m offered seem like a bit of a joke. A new breed of business manager has crept into the business while the world has changed, these are people who grew up with technology and are comfortable solving their technology problems on their own. They know that there are alternatives to the expensive solutions proposed by the IT department (solutions that IT will engage an SI to deliver), and they’re happy to use these alternatives. Why spend a seven figure sum and wait a year for the IT department’s perfect, enterprise-wide project portfolio management solution when there’s one that is good enough, one you can buy on-demand via a company credit card, and one which you know will be up and running in a couple of weeks? We might argue about the regret cost[2], but the art of business is to make a timely decision and then make it work; it’s not to sit on your hands and wait for the perfect solution which will be delivered sometime in the distant future. While demand for new IT solutions might be growing, every time a business manager steps around IT to engage and on-demand solution SIs have one less opportunity to sell their wares.

At the same time we find that these on-demand solutions – when SIs do get their hands on them – only provide a fraction of the revenue that a tradition on-premisis solution does. Time is money for an SI (literally, as most avoid risk by sticking to time and materials contracts) and fielding a SaaS solution takes only a fraction of the time required for a more traditional solution. There’s no hardware to commission with SaaS or cloud computing, nor are there disks to wait for or backup strategies to create. (You still need to worry about business continuity, but that’s another post.) There’s also little chance for customisation, and integration tends to be via standard APIs or pre-built adaptors. It’s not uncommon for a SaaS project to be eighty percent smaller than the more traditional solution. Fewer resources on ground and fewer billable hours means that that the SI can expect their revenues to head in the same direction: south.

We’re also seeing the erosion of SI support revenues. Support used to encompass both the application – in terms of application maintenance, patching and security – and the users – with training and a help desk. Many SaaS and cloud providers don’t want to provide traditional support services as it erodes their margins, margins based on huge scale and little human contact. One solution is to engage an SI to provide these services for them, either on a client-by-client bases or as part of some sort of alliance. A more attractive solution is to move – as much as possible – to a self support model where clients support each other via user forums or a Google search. We soon find that a much smaller help desk will suffice as it’s only required to be the point of last resort, or to support the more technologically illiterate users.

Taken together, these trends – reduced access to buyers, lower project revenues, and lower support revenues – seem to show that the future is not as rosy for the SIs as we first thought. Demand for IT might be growing, but growing demand for IT no longer implies growing demand for the services provided by SIs. The final nail in the coffin is the fairly recent move into SaaS by established IT application vendors. Microsoft has gone on record as wanting to capture a greater percentage of IT spend as license revenues, converting SI installation and customisation costs into licenses by providing clients with prepackaged configurations which can be turned on at the flick of a switch. Rather than pay for a SaaS CRM and then engaging an SI to configure it to your liking, you pay for the SaaS CRM along with a canned sales methodology (Miller Heiman[3]? Holden[4]?) which works out of the box (as it were). Integration between SaaS solutions is also being converted into a configuration option as SaaS vendors sign alliances – just as Google and Saleforce.com did with GoogleForce – enabling these alliances to offer complete application suites which work together out of the box.

Whichever way you look at it, now is not a good time to be a SI.


References


1. Business models for the old rules of IT @ PEG↑
2. The price of regret @ PEG↑
3. Miller Heiman: The Sales Performance Company↑
4. Holden International: Outsell You Competition↑

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BPM over promised and under delivered

2011/07/01 in Business Process Management | 6 comments

One Saturday night the other week I was typing away on a book that I’m working on (probably called The new instability. How cloud computing, globalisation and social media enable to you to create an unfair advantage) and I let out what was probably a quite involved tweet without any context to explain it.

BPM has under delivered as it's rooted in Taylorism – *there is one true way to do the work* – but today we need to support multiple ways.
2011/04/16 7:35 pm via EchofonReplyRetweetFavorite

Recently I’ve been thinking about the shift we’re seeing in the business environment. The world seems pretty unstable at the moment. Most business folk assume that this is simply a transition between two stable states, similar to what we’ve seen in the past. This time, however, business seems to be unable to settle into a new groove. The idea behind the book is that the instability we’re seeing is now the normal state of play

Since Frederick Taylor’s time we’ve considered business – our businesses – vast machines to be improved. Define the perfect set of tasks and then fit the men to the task. Taylor timed workers, measuring their efforts to determine the optimal (in his opinion) amount of work he could expect from a worker in a single day. The idea is that by driving our workers to follow optimal business processes we can ensure that we minimise costs while improving quality. LEAN and Six Sigma are the most visible of Taylor’s grandchildren, representing generations of effort to incrementally chip away at the inefficiencies and problems we kept finding in our organisations.

This is the same mentality – incremental and internally focused, intent on optimising each and every task in our organisations – that we’ve used to apply technology to business. Departmental applications were first deployed to automate small repudiative tasks, such as tracking stock levels or calculating payrolls. Then we looked at the interactions between these tasks, giving birth to enterprise software in the process. Business Process Management (BPM) is the pinnacle of our efforts, pulling in everything from our customers through to suppliers to create the optimal straight through processes for our organisation to rely on.

Some vendors have taken this approach to its logical extreme, imagining (and trying to get us to buy) a single technology platform which will allow us to programme our entire business: business operating platforms[1]. They’re aligning elements in the BPM technology stack with the major components found in most computers under the (mistaken) assumption that this will enable them to create a platform for the entire business. Business as programmable machine writ large.

The problem, as I’ve pointed out before[2], is that:

Programming is the automation of the known. Business processes, however, are the management and anticipation of the unknown.

Business is not a computer, with memory, CPUs and disks, and the hope of creating an Excel with which we can play what if with the entire business is simply tilting at windmills.

The focus of business is, and always has been, problems and the people who solve them. Technology is simply a tool we’ve used to amplify these people, starting with the invention of writing through to modern SaaS applications and BPM suites. While technology has had a previously unimaginable impact on business, it can’t (yet) replace the people who solve the problems which create all the value. People collaborate, negotiate, and smash together ideas to find new solutions to old problems. Computers simply replicate what they are told to do.

We’ve reached Taylorism’s use-by date. Define the perfect task and fit the man to the task no longer works. The pace of business has accelerated to the point that the environment we operate in has become perpetually unstable, and this is pushing us to become externally focused, rather than internally focused. We’re stopped worrying about collecting resources to focus on our reactions to problems and opportunities as they present themselves. Computing (calculating payrolls, invoices, or gunnary tables) is less important as it can be obtained on demand, and we’re more concerned with the connections between ourselves and our clients, partners, suppliers and even our competitors. And we’re shifted our focus from collecting ever more data as it becomes increasingly important to ask the questions which enable us to make the right decisions and drive our business forward.

Success today in today’s unstable environment means matching the tactic – process – to the goal we’re trying to achieve and our current environment, with different tactics being using in different circumstances. Rather than support one true way, we need to support multiple ways.

There has been some half steps in the right direction, with the emergence of Adaptive Case Management (ACM)[3] being the most obvious one. A typical case study for ACM might be something like resolving SWIFT payment exceptions. When the ACM process is triggered a knowledge worker creates a case and starts building a context by pulling data in and triggering small workflows or business processes to seek out data and resolve problems. At some stage the context will be complete, the exception resolved, and the final action is triggered. Contrast this with the standard BPM case study, which is typically a compliance story. (It’s no surprise that regulations such as SOX drove a lot of business processes work.) BPM is a task dependency tool, making it very good at specifying the steps in the required process, but unable to cope with exceptions.

So what do we replace the Talyorism’s catch cry with? The following seems to suit, rooted as it is in the challenge of winning in a rapidly changing environment.

Identify the goal and then assemble the perfect team to achieve the goal.

Note: This was also posted on noprocess.org.


References


1. Ismael Ghalimi (2009), Introducing the Business Operating Platform, IT|Redux↑
2. Business is not a programming challenge @ PEG↑
3. Keith D. Swenson (2010), Mastering the Unpredictable, Meghan-Kiffer Press.↑

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Good advice

2011/06/22 in Business-Technology | No comments

There’s a few bits of good advice that I’ve stumbled across during my time, and which I’ve sprinkled in some of my posts. I thought it might be worthwhile gathering them into one place.

On solving problems

If you don’t like the problem, then change it into one you do like.
— Dr K Pang

One of the best pieces of advice I picked up was from Dr. K. K. Pang[1] at university some time ago. Dr Pang taught circuit theory, which can be quite a frustrating subject. It’s common to encounter a problem in circuit theory which you just can’t find a way into, making it seemingly impossible to solve. Dr. Pang’s brilliant, yet simple, advice was “If you don’t like the problem, then change it to one you do like.”. Just start messing with the problem, transforming bits of the circuit at random until you find a problem that you can solve.

The trick with overcoming many of the obstacles that life and work throws in front of you is to realize which problem you should be solving.

On creativity

It’s pointless to try and be original, as someone’s always done it before. Just focus on doing what you’re interested in.
—Tom Fryer

My guitar teacher of many years back, Tom Fryer[2], had a bit of sage advice. It’s pointless to try to be original, as someone will always have had the idea before you. It’s a big world with a lot of history, and there’s not that many ideas. A more productive approach is to simply plow your own furrow; focus on the problems you want to solve, steal ideas shamelessly if they seem useful, and invent what you need to fill the gaps. It doesn’t matter if what you’re doing is original or not; it’s only a question of how useful and interesting the result is.

This is something that I’ve since seen from a few well known creative folk.

It’s not where you take things from, it’s where you take them to.
—Jean-Luc Godard

Innovation (a related topic) is not a question of having a great idea, or being the best at execution. Results count: what did you do with the opportunity to had?

On being the best

You’ll end up disappointed if you worry about being the best at what you do. It’s a big world and you’ll eventually run into someone has more skill. It’s more important to be happy with what you’ve done.
—Tom Fryer

Another from Tom; he’s a very wise man. No matter how much you practice, some day, probably in an armpit bar in the backwoods, there’ll be someone who blows you away as they have more skills than you. Winning awards or contests doesn’t mean you’re the best; it just means that you’re the most successful competitor at the time. (Or just the most popular, as many contests are actually fashion contests.) Some folk don’t choose to compete.

This ties back to John Kay’s concept of obliquity[3]: the idea that your goals are often best approached obliquely. The most effective path up the hill is usually to weave our way up the slope, rather than directly attack the steepest path.

I call this paradox the principle of obliquity. It says that some objectives are best pursued indirectly. I owe the phrase to Sir James Black, the chemist, whose career illustrates the principle in action. Black made more money for British companies than anyone else in the history of British business, by inventing beta-blockers and anti-ulcerants. The first he discovered in the laboratories of ICI, the second in those of Smith Kline French after he had decided that ICI was more interested in profits than in chemistry. To quote Black ‘I used to tell my colleagues (at ICI) that if they were after profits there were easier routes than drug research. How wrong could one be?’ The attempt to pursue profit too earnestly is pharmaceutical research defeated its own objectives.
—John Kay

The path to sustained success is not to set some imaginary hurdle to jump over – being the biggest or best – but to focus on doing what it is you want to do. IBM – helping business make use of technology – has been successful for over one hundred years. Microsoft – the biggest application developer on the planet – is struggling after a few decades[4].

Apple’s journey over the last decade or so seems to bear this out.

We just want to make products that we’d love to own.
—Steve Jobs

On being somebody

“Tiger, one day you will come to a fork in the road,” he said. “And you’re going to have to make a decision about which direction you want to go.” He raised his hand and pointed. “If you go that way you can be somebody. You will have to make compromises and you will have to turn your back on your friends. But you will be a member of the club and you will get promoted and you will get good assignments.”

Then Boyd raised his other hand and pointed another direction. “Or you can go that way and you can do something – something for your country and for your Air Force and for yourself. If you decide you want to do something, you may not get promoted and you may not get the good assignments and you certainly will not be a favorite of your superiors. But you won’t have to compromise yourself. You will be true to your friends and to yourself. And your work might make a difference.”

He paused and stared into the officer’s eyes and heart. “To be somebody or to do something.” In life there is often a roll call. That’s when you will have to make a decision. To be or to do. Which way will you go?”

—John Boyd from Boyd: The fighter pilot who changed the art of war[5]

It’s a big choice, but one the career councillors at school seem to gloss over. You can either choose to be someone, to fulfil a specific role such as CEO or rock star, or to do something, such as feed the poor. If you’re lucky, doing something will also allow you to be someone (such as Mother Teresa), but it doesn’t work the other way around.


References


1. Dr Pang unfortunately passed away in March 2009.↑
2. Greasy Boundaries by the Tom Fryer Quartet at Bar 303 Northcote, Melbourne Australia.↑
3. John Kay (Jan 2004), Obliquity, The Financial Times↑
4. The Economist (2011), Middle-aged blues: The software giant is grappling with a mid-life crisis↑
5. Robert Coram (2002), Boyd: The fighter pilot who changed the art of war, Back Bay Books↑

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It’s effectiveness, and not ideas or execution, which is the strongest determinant for success

2011/06/20 in Business-Technology | 1 comment

We’re told that execution is everything. While a good idea might be useful, execution is seen as the factor that will determine the success or failure of our business venture. Many people find this comforting as good ideas are rare, seemingly springing from nowhere, and few of us hold little hope of having a really good idea in our lifetime. (One definition of “genius” is someone who manages to have more than one good idea before they die.) Execution, however, is something we can control. We can practice, improving our skill, making us more likely to succeed.

Our focus first on ideas and then execution distracts us – possibly intentionally so – from the real driver for success in business: luck. Brilliant ideas – ideas who’s time has come – are obviously rare. And then there’s our natural proclivity to overestimate our own abilities. (Such as the vast majority of drivers who think they are better than average drivers. Some of them must be wrong). While we don’t like to admit it, finding ourselves at the right place at the right time with a good enough solution is more important than any other single factor.

Google is a case in point. We can admire skill of Larry Page and Serge Brin, and the search algorithm they developed was obviously better than what came before, but neither of these is sufficient to explain the success that is Google today. Something else was required; luck had a large part to play in their success. If they hadn’t been turned down when they tried for sell a young Google for something like one million dollars, if the didn’t have access to the venture capital community on Sand Hill Road, if they …

We don’t like to talk about needing luck, as allowing luck into the equation implies that something is outside our control, that a success was not the result of our skills alone. If we rolled the Google dice again, from a starting position where the world was slightly different, would Google float to the top? Or would someone else find themselves at the right place at the right time with a good enough idea?

Many business leaders have penned biographies which highlight how their skill – and their skill alone – drove their organisations ever higher. A few are brave enough to admit that they were lucky, and that they were smart enough to to make the most of luck when it flowed their way.

Business is a numbers game. While each throw of the dice might be random, across a number of rolls we can can identify trends which we can use to tip the odds into our favour. An effective player realises this and works to exploit the trends they see and increase their luck. Or as one smart and lucky golfer was heard to say:

The more I practice, the luckier I get.

— Gary Player

The large innovative move from an established company, or the disruptive startup that become a billion dollar company at the founders first attempt, is the exception. There is no silver bullet, a single thing they did and which we can replicate.

Most of us need to play a longer game if we want to see success. Each time we roll the dice we need to ensure that the odds move a little further into our favour by:

  • being frugal with our resources
  • moving to a position where we have a better chance of success
  • make the most of the opportunities that are presented to us
  • learning from our previous mistakes

It’s not ideas or execution that determine our success. Both are important but neither is sufficient. It’s our ability to increasingly become more effective with each action we take – our ability to learn from our mistakes, rather than our ability to improve our skills – increasing our luck to the point that one day it overflows and we find ourselves with a success.

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On the process of writing

2011/06/17 in Enterprise 2.0 | No comments

I happen to have set that sentence down in the old, slow way by hand. If I had used a computer, I might have got it down in a third, a quarter of the time. But like a good many writers, even this far into the twenty-first century, I find that the pace at which I work in longhand – at which my arm, my hand moves in the act of writing – has what is for me a “natural” relationship to the speed at which my mind works and I do not to let go of a relationship that seems peculiarly mine. Writing by hand slows the thought process, allowing thinking to think again, mid-through, and leaving open the possibility of second thoughts. It has an effect too on syntax, on the way a sentence gets shaped.

—David Malouf, The Happy Life, Quarterly Essay QE41

Selling into the new whitespaces

2011/06/14 in Business-Technology | No comments

Organic growth is a distant memory for many companies. Markets in the first world are mature and the whitespace they contain has already been claimed. The only new business many companies can expect to find is the business they steal from someone else. This trend has driven many organisations to turn to the relatively undeveloped emerging markets – the BRIC[1] nations in particular – or acquisition for the majority of their growth. The problem, however, isn’t the lack of white space; with markets constantly evolving, driven by technology and fashion, new white spaces are constantly bubbling in and out of existence. The problem is that our current, monolithic business models, cannot fit into these new white spaces,

Business growth comes from one of two directions: either organic growth, or by acquisition. You can buy a plot in the mother land, or you head out into the undiscovered countries to find a plot for your own. Much has been written about both of these approaches.

Competitive business strategy – the art of stealing someone else’s plot – has been refined to a fine art. With our five forces[2] strategy maps[3] and scenario planning[4], we have a range of tools at our disposal with which we can map out the opportunity, determine our strengths, measure the weaknesses of our competitors, and plan our attack. Competition has become quite bloody, with the major players in each industry and market evenly matched. For all their efforts, most businesses can only tweak their share of the market a few points either way, while their year-on-year performance dominated by the performance of industry as a whole.

The last gasp of this approach was the idea of blue oceans[5]. If the ocean where you’re paddling is red with the blood of your competitors, then perhaps its time to find a patch of clear blue ocean where you can paddle unmolested on your own. This is an approach that Nintendo used to great effect. Nintendo decided not to compete directly with Sony and Microsoft in the battle for the home gaming console. The market was dominated by Sony and Microsoft, each investing heavily to try and improve the graphics of their next generation console to give a more realistic (and violent) experience. Instead, Nintendo chose to focus on casual games (first needing to invent the concept of casual games) which had a wider appeal than the core gamer market. These are game that are easy to pick up and put down, games which much broader appeal than the first-person shooters which dominated the market at the time, and game which the core gaming market derided as simple and uninteresting. Casual games made Nintendo the most profitable company per employee in the world (beating even Goldman Saches at their peak) for a brief period of time.

Since Nintendo and the Wii, the pace of business has accelerated (again), driven by globalisation and cloud computing. Nintendo took several years to develop one market defining product, and is now struggling with it’s next move and the market for casual games is leaving it behind. Younger companies like Zinga swooping in with lower cost, online games to steal much of the market for casual games. The opportunity to move sideways and find new blue oceans is becoming rarer, as the rapid pace of business means that you often find that the patch of blue ocean that you were paddling for is as red as the patch you left, as many of your competitors saw the same opportunity. The whitespace is – in effect – drying up.

With organic growth into the white space a distant memory the first work, many companies are turning to the developing work – the BRIC nations in particular – to try and grown their revenues. Find a country further back on the development curve and peddle you weres there, where the is no (or, at least, little) sophisticated competition. There are some hurdles to overcome, such as the fact that we need to package our toothpaste and mouthwash in sachets, rather than large tubes and containers, but the white space seems to be there for the taking.

Globalisation is a double edged sword though. Not only does it allow you to sell your goods in every nook and cranny around the planet, to also allows the local companies, the companies in those nooks and crannies, to leverage the best expertise and suppliers from around the world to service their local market. While the world might be flat, it is also spiky and local knowledge counts. Western companies are finding that they are increasingly beaten to the punch by a more agile and knowledgeable local. The developing world is developing a lot faster than many of us expected.

The white space, however, is not completely filled: the circle that is the market has a well-defined centre but no discernible circumference, and new opportunities are constantly popping in and out of existence around it’s edge. Rapidly evolving circumstances and changing fashions are creating new market opportunities, new white space, as customers realise that they have an unfulfilled need. The problem is that our existing businesses can rarely fit into the holes these opportunities provide. Conceived as vast machines, our businesses are built around powerful engines, with each piece turned to provide optimal performance. While this might provide our businesses with power, it also makes them cumbersome. They’re the muscle car from the seventies: fast in straight line, but corner like the titanic. We’re usually still madly tugging on the tiller trying to turn the ship when the opportunity evaporates back into the ether it came from.

The challenge is to change the way our businesses behave – how they use assets and people, their processes and governance – so that they can fit into these new white spaces. Delta Motorsport[6], for example, approached the process of designing a new car from an unconventional direction. Locating themselves near Silverstone in the U.K., among the various Formula 1 teams and (more importantly) the community of contract manufacturers that surround these teams – Delta was able to design the E-4 Coupe, a 150mph (241kph) electric sports car, for the tiny budget of £750,000 and with just ten employees. They expect that they can move the car into production for an additional £4.5 million, a fraction of the $1 billion, and in a fraction of the time or more required via a more conventional approach.

The market is fragmenting as companies such as Delta Motersport, Megabus[7] and Kogan[8] create business models which enable them to fit into these new white spaces. In some instances these white spaces sit beside existing market, providing new products and services to customers who were previously left unsatisfied. At other times the bubbly edge drains away soft centre, as the white space provides new products and services for customers who used to settle for something else.

Colonising the new white spaces requires us to approach our businesses from a different direction. Rather than think about our business as a statically configured and optimised machines – Henry Ford’s production line writ large – we need to consider our business as more flexible, dynamically optimised vehicles. Optimising internal systems and processes no longer provide us with a competitive advantage. We need to reorient out teams externally, intent on understanding the environment that is unfolding around us and driving the business forward. We need to streamline the controls, the accountabilities and processes we use to operate the business, ensuring that it is easy to enact any decision once it is made.

The challenge today is to understand where to find these new white spaces, and to build up a playbook of tactics which informs us on how to leverage the plethora of on-demand capabilities (BPO, cloud, SaaS, globalisation …) available to us today to reshape parts of our business to fit into the tightest white space.


References


1. BRIC: Brazil, Russia, India, China↑
2. Michael E. Porter’s five forces discussed @ Wikipedia↑
3. Strategy maps discussed @ Wikipedia↑
4. Scenario planning discussed @ Wikipedia↑
5. W. Chan Kim and Renee Mauborgne (2005), Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant, Harvard Business Press ↑
6. Viknesh Vijayenthiran (May 2011), Move Over Tesla, Delta Motorsport Launches 150 MPH E-4 Electric Coupe, Motor Authority↑
7. Ben Austen (April 2011), The Megabus Effect, Businessweek↑
8. Kogan Electronics↑

How should we measure out people?

2011/05/19 in Enterprise 2.0, Knowledge Worker of the Future | 1 comment

We all know the old adage:

What get’s measured is what get’s done.

However, if you constrain your measurement of your employees’ performance to counting the goals they score, then you’re doing most of your team a disservice. While their hand might not have been the last to touch the ball before it landed in the goal, supporting players often make vital contributions. If there was no one there to pass the ball to the player in front of the goal, then there would never have been a goal.

Most sports take this into account and include “assists” (passes that help another player score) in the statistics they collect. This broader approach allows us to measure individuals based on their main roll on the playing field: number of goals scored for a shooter, number of assists for those on the wing, number of deflected shots for a defender, and so on. Unfortunately, this too has it’s own problems.

What is the best option for someone playing on the wing, someone who finds themselves in possession of the ball, in front of the opposition’s goal, and with none of the opposing team anywhere near them? Should they take a shot at goal? Or should they wait for a shooter to catch up, potentially along with players from the opposing team, and pass the ball to the shooter? Intuition tell us they should do the former: take the easy shot and score the goal. A bird in the hand is better than one in bush. Logic, however, tells the wing to wait for the shooter: pass the ball and count the assist. While taking the shot might have a higher chance of scoring a goal (and potential winning the game), in the longer term the wing is thinking about their career, and their future as a wing is determined by their ability to collect assists, not goals. Sometimes the metrics we put in place encourage undesirable behaviours.

Simple, single dimensional measures are attractive as they seem to allow us to quantify the world, and our team’s performance. The problem is that the world isn’t quite so simple. Our measures often set individual interests against those of the team. Rather than forming a team which is working together toward a common goal, we’ve created created a group of individuals who’s personal goals can often be in conflict with the team’s best interests.

What we really want to measure is how effective each team member’s contribution was. Given the opportunities presented to them, did they make the best, most effective, use of them? Was waiting for the shooter and then taking the assist the most effective thing they could do for the team? This depends on the context of the assist. If the shooter – a more accurate player – was only a couple of steps behind, with the competition still somewhere at the other end of the court, then yes, it probably was. The shooter has a better chance of scoring and the opposition was is not a factor. If shooter arrives with the opposition or, even worse, after them, then no, the wing should take the shoot. Even though the shooter is more accurate, the confusion caused by the opposing team means that the shooter will have a lower chance of success when surrounded by the opposition, than the would wing standing there on their own.

Business works the same way. One of the dirty secrets of performance reviews is that they often reward the employees who manage to attach themselves to the most successful project or department, not the ones who make the best use of the opportunities presented to the business. For example, if you managed to work your way into SAP supply chain projects in the mid to late nineties, you could expect a nice pay rise and promotion at each performance review. The market was booming and each project you moved to would be bigger and better than the last, allowing you to consistently deliver over your performance targets. It’s not that you were performing better than any of your peers in other areas, it’s just that your domain grew more than theirs. We see a similar thing in the share market, where many companies like to pat themselves on the back for a good year, when in reality they didn’t do that well compared to the rest of the market.

What we’re looking for is not the player with the highest statistics, the player with the most goals or assists. We want the most effective player, the one who can create the greatest advantage of the opportunities presented too them, using their own skills and those of the people around them. Rather than promote the people who float up with a rising market, we need to find those people who are more effective than their peers, and put them in a position where they can lift the performance of the entire business. The people who can deliver outlier performance.

The importance of taking time

2011/05/16 in Uncategorized | No comments

Jeff Bullas has nice post on his blog called “Is this the future of books” about where publishing might be taking us. He’s less interested in the future of the codex (sheets of paper bound to form a block) that we’re all familiar with, than the future of the narrative which lives inside many books.

Jeff, like myself, enjoys an author taking him somewhere, either by weaving a tale of dastardly deeds (á la James Elroy), or building a an argument that might make me change my opinions (á la Peter Singer). Much of the development with ebooks seems to be more focused on multimedia, which is a great tool to explore a topic or idea, but in some instances it doesn’t have the power that a narrative can bring to the topic. He doesn’t come to any strong conclusions, but he raises some interesting questions. Go read the post: it’s a good one.

What really caught my eye, however, was one line he threw in toward the middle of the post:

Do Gen Y have the time to read or enjoy a book for a quiet 2 hours when everything is about ‘now’ and 2 minute YouTube videos and 400 word blog posts?

This got me thinking.

Many books have very little inherent value. They’re just filler. The pulp fiction you buy at the airport, or that copy of Ninja Ruby Coding for Left Handers or Six Sigma for Dummies are often just thrown together. That’s ok as you’re just getting them to waste time on the plane or get a quick overview of the topic. We’re not expecting War and Peace.

These days though, we have alternatives to the physical book. Those pulp novels are being replaced by low price ebooks, often costing only $2.99, while the reference book are being edged out by Wikipedia and other community created references. (And the “e” versions of reference books are searchable.) Neither of these use cases justify a high price tag or heavy investment from the author. The reason we made them into books historically was that it was the only way the information could find distribution. These days we have more appropriate distribution models. (Plus reference books these days often just seem to copy large slabs of text from public resources anyway.)

Some books, however, build a longer narrative and bring some insight on a specific problem or the world at large. These books can justify being 400 pages or more, as it often takes that long to build their argument and walk you through the various aspects. Over their 400 hundred pages they bring a unique value, changing how you think about some topic, a shift which might range from your attitude to yourself and society (as Peter Singer has done, inventing entire social movements in the process) through to showing you new ways to think about your business and how to improve it (Peter Drucker and Michael Porter spring to mind). And there’s always the likes of George Orwell, Neal Stephenson and Margret Atwood to argue for the longer fictional narrative.

This raises an interesting question: if these longer form books have a distinct value, then are you missing out on something important if you pass them by? Or, more specifically, are the people who cannot (or will not) consume these high value books putting themselves at a disadvantage relative to the people who do?

If all you’re ever doing is reacting to information that happens to flow your way, then you cannot claim to be in control of your own destiny. You’re just reacting to the environment as it unfolds. The challenge is, as always today, to know where to invest your time so that you can move beyond simply reacting. Some ideas require more effort, but the reward is worth it. A short blog post might provide stimulating coffee break conversations, but if it doesn’t change the way you view the world did it add much value beyond being convenient infotainment. That TED talk you watched in your lunch break might be inspiring, but did it change how you approached and did your work in the afternoon?

We live in a rapidly changing world, and many peoples’ reasons for consuming all these snack sized ideas is to help them find the one’s which will make a difference. However, if you never take the plunge and explore the longer form arguments that seem interesting, you just might be doing yourself a disservice. Living on quick, easy and cheap McMuffins might keep you going in the short term, but you could regret it later when you no longer fit behind the steering wheel.

Problems and the people who solve them

2011/05/12 in Enterprise 2.0, Knowledge Worker of the Future | No comments

Note: This is the sixth and final part of a longer series on how social media is affecting management. You can find the earlier posts – The future of (knowledge) work, Knowledge Workers in the British Raj, The north-south divide, Working in Hollywood and World of Warcraft in the workplace – elsewhere on this blog.

What impact will Social Media have on your business? Is it evolution, revolution, or a non-event? It’s hard to deny that Social Media is changing how we understand the role of government, and how we interact on the social commons. But what is its impact on the private sphere: the gated communities which are our businesses and organizations? Some folk claim that we’ll see a similar shift in the private sphere as we’re seeing in the public one. A revolution in the workplace as the workers realize that they really do control production, downing tools in search of a better deal and conditions.

This point of view ignores two key facts. First, that private spaces are, by their nature, more flexible than public as we are free to define who can inhabit them. Revolution is unlikely. Business owners still need someone to hold accountable for the performance and behavior of their businesses, just as regulators and governments want to ensure that someone in the organisation is on the hook for meeting their demands. Management will continue to manage, and to be held accountable, no matter how empowered the workforce becomes[1]. Second, that the technologies we’re deploying don’t just change how we carry out the tasks our businesses needs, as they also change what tasks we need to carry out. There is no reason for tomorrow’s organizations to operate within the same framework that yesterday’s ones did.

The nature of work is changing, and the shift in work practices looks like it will be comparable to the shift we saw during the Industrial Revolution – between the 18th and 19th centuries – when almost every aspect of daily life was influenced in some way. Before the Industrial Revolution people worked from their homes, farming or blacksmithing as the need arose, and the concept of work-life balance hadn’t found its way into the dictionary. After the revolution most people worked in vast bureaucracies, leaving home every morning to travel to work (or, early on, living in vast company owned dormitories next to their work) and fit themselves to into the tasks demanded of them.

The Industrial Revolution gave us Taylorism, a view of business which equates the organization to a vast programmable machine. Businesses were inward looking, intent on improving their internal operations. Optimizing business was the challenge of defining the perfect sequence of tasks, each carefully sculpted to deliver maximum value at minimum cost, and then selecting and shaping employees to fit the tasks.

The environment business operates in today has changed dramatically since Frederick Taylor created scientific management. The world used to be fairly stable; you wore the same clothing styles (more or less) as your parents before you, as would your children following after. Today, however, the environment changes significantly every year, if not every month or week. Nowhere is this more evident than with the creation of fast fashion, with Zara flipping the company’s supply chain on it head to optimise time from runway to shelf rather than cost, swapping the seasonal fashion collection for a constant stream of new products and driving new customer behaviours in the process.

The stability business used to rely on has given way to a more uncertain environment; the predictable progression of the business seasons in a temperate climate exchanged for the unexpected and often unpredictable storms and hurricanes of a more tropical clime[2]. Our success used to rely on the quality of our toolkits – the business processes and assets at the heart of our business – as it is these toolkits that enabled us to survive the steady progression of the seasons. Today our success relies on our skill – our ability to leverage the on-demand services and capabilities we find around us – as it is our ability to adapt these tools we find around us to the unexpected threat or opportunity, that now determines our success.

The old, highly specialized and highly entailed experts we used to rely on are rapidly becoming a liability, and we’re incrementally replacing specialized skills with solutions, frameworks and on-demand services. From IBM’s first election toting machines built with repurposed punchcard readers from knitting mills, through early departmental computers (such a L.E.O., the Lyon’s Electronic Office) to the birth of enterprise IT (and client-server along with it) and more recent web technologies, the history of technology in business has been a story of slowly reifying layers of expertise in tools, enabling this expertise to be distributed and leveraged. Social Media is just the latest step in this evolution, the key difference being that it automates and streamlines the communication and collaboration between individuals, rather than tasks that these individuals work on.

Our companies are being hollowed out, their middle layers of management replaced by software and solutions. Rather than empowering middle management, Enterprise 2.0 and Social Business Design is eliminating them. Social Media is empowering the team at the front line and the executive to connect directly with each other, bypassing the many layers of middle management most organizations contain. They’re externally focused – the front line intent on tending our customers and delivering product, the executive focused on understanding the waves in the market and charting the business’s path forward – where middle management was internally focused, concerned with keeping the bureaucracy functioning, a bureaucracy that many organizations are in the process of dismantling. Similar to the rural Indian civil service in the British Raj[3], we’re moving to flat, or even super-flat, organizational structures which swap the command-and-control of the past for clear objectives and the devolution of responsibility for decisions to the front line.

Tomorrow’s business, after it has adopted Social Media, will not just be a new command-and control paradigm (bottom-up rather than top-down, distributed rather than centralized) retrofitted to our existing bureaucracies. Tomorrow’s business will be something different, smaller and much leaner, built from dynamically forming coalitions focused on achieving a common goal. The highly skilled specialists concerned with building the complex toolkits will become a thing of the past.

The transformation from large bureaucratic organizations to more fluid coalitions will result in a similar shift in work practices as we saw during the Industrial Revolution. We can already this the beginnings of this with companies starting to understand that their knowledge workers prefer to supply their own tools (such as mobile phones and laptops), as well as the current trend for organisations to restructure their contracts with suppliers, focusing on the outcome they want delivered rather than quality and cost. Smaller workforces holding more general skills will integrate themselves with a community of partners, suppliers and high value free agents, with the company functioning in a similar way to the studios in modern Hollywood[4]. The company sets the agenda by determining what problems it wants to focus on, while providing its staff and the broader community swirling around them with a platform to dynamically form teams around specific challenges and goals, World of Warcraft style[5]. Rather than defining the perfect task and then fitting the employee to the task, we need to define our goal and then assemble the perfect team to achieve that goal.

The most significant shift for our businesses is the transition from being knowledge using organizations, to knowledge creating organizations. While the world might be flat (as Thomas Friedman showed us[6]), with globalization and the Internet providing on-demand access to low cost products and services from around the globe, the world is also spikey (as Richard Florida claims[7]) as the need for localized and personalised services drive demand for unique and creative solutions which fit into a local context. The winners in this race will be the businesses that can marry the two.

Which brings us back to the impact of social media on your organization. It’s not a revolution that will remove the need for the C-level; someone still needs to sign the books and be held accountable to shareholders. Social media might tip the balance a little toward a more collective form of management, but it will not rewrite the rules overnight. Nor is it little more than better and more efficient groupware. Creating a social business is not simply rearranging the people (and power dynamics) or your existing business; it demands smaller, more dynamic teams with more potent and focused team members who might not be on your payroll full time.

What Social Media is doing is driving organizations to complete the shift started in the last few decades, moving from manufacturing centric enterprises to knowledge creating organisations.

The basic economic resource – ”the means of production,” to use the economist’s term – is no longer capital, nor natural resources (the economist’s “land”), nor “labor.” It is and will be knowledge. The central wealth-creating activities will be neither the allocation of capital to productive uses, nor “labor” – the two poles of nineteenth- and twentieth-century economic theory, whether classical, Marxist, Keynesian, or neo-classical. Value is now created by “productivity” and “innovation,” both applications of knowledge to work.

— Peter Drucker, The Post-Capitalist Society[8]

Historically companies have provided a locus to gather the capital, resources and skills required to provide the scale needed to manufacture products cheaply and efficiently. Today problems, the problems of our clients and customers, are increasingly becoming the focus of our organizations, as capital, resources and skills are commoditized, caught between globalization and the Internet. The strongest determinant of success in business today is the ability to solve problems that other people (and organizations) care about. Companies are transitioning from an internal focus to an external focus, intent on gathering the skilled craftsmen required to deliver the projects needed to solve the problems that the company concerns itself with. Companies are becoming the focal point for a network for skilled craftsmen and service providers who are required to solve the problems that the organisation is interested in.

Business is increasingly becoming a question of forming the right team, at the right time, in the right place, with the right tools to provide the best possible outcome. We’re also trying to achieve this in an environment where it is no longer feasible to own all the resources and people we need. Consequentially, success now depends on our ability to mobilize the resources and skills we need from across a broader network that includes not only our (few) employees, but our contractors, partners and even customers. Social media and social business are the tools that allow us to tweak our operating models to do this.

So the impact of social media on our businesses is to strip them back to their cores and (re)focus their energies on what really matters in a rapidly changing and unpredictable environment: problems and the people who solve them.


References


1. The future of (knowledge) work @ PEG↑
2. The North-South divide @ PEG↑
3. Knowledge workers in the British Raj @ PEG↑
4. Working in Hollywood @ PEG↑
5. World of Warcraft in the workplace @ PEG↑
6. Thomas L. Friedman (2005), The World if Flat, Farrar, Straus & Giroux ↑
7. Richard Florida (2005), The World is Spikey, The Atlantic [PDF]↑
8. Peter Drucker (1993), The Post-Capitalist Society, HarperCollins↑

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World of Warcraft in the workplace

2011/04/20 in Enterprise 2.0, Knowledge Worker of the Future | 2 comments

Note: This is the fifth part of a longer series on how social media is affecting management. You can find the earlier posts – The future of (knowledge) work, Knowledge Workers in the British Raj, The north-south divide and Working in Hollywood – and the final issue – Problems and the people who solve them – elsewhere on this blog.

What does our organization look like when the middle layers are removed? How does a team form and establish it’s goals in a world where there is no middle management to do it for them?

Companies find themselves caught between the conflicting needs of working smarter while keeping costs down. Creating a competitive edge means finding the high-value skills required to out think the competition, and they’re willing to pay a premium for the privilege. At the same time, an increasingly competitive market is pushing revenues down, creating a financial void that will most likely consume the margins and mid level management of many organization.

A new business dynamic is emerging, one which is much more fluid as it’s based on networks of organizations and high-value individuals – much like the industry model Hollywood stumbled on during the transition to television in the fifties. Companies in industries as diverse as automotive, banking, retail, and real estate are responding to the new recession mentality by focusing on their core competencies and value- add, driving these organizations to consolidate, rationalize and externalize supporting functions, as they rely on a growing ecosystem of partners to deliver everything from their go- to-market strategies through product development to manufacturing and fulfillment.

Slaying dragons

In 2010 something in the order of eleven and a half million people, broken into two factions, completed over sixteen million tasks every day without the aid of a bureaucracy, spending an average of twenty two hours a week dynamically forming teams and solving problems. How did they do it?

With a population greater than that of New York City, World of Warcraft provides us with an interesting case study of how to motivate and mobilize large groups of people. Management experts, such as Tom Peters, consider the ideal size of an organization to be around one hundred and fifty people, as beyond this size, knowing everybody in person becomes impossible. Above one hundred and fifty people intermediate layers of power and delegation begin to develop and companies enter the realm of complication. World of Warcraft seems to indicate that this doesn’t necessarily need to be the case.

Many organizations are struggling to successfully knit focused and effective teams from the incoherent mass of individuals both in and outside their organizations. Entire industries are migrating to an operating model which has more in common with the fluid and dynamic film industry in Hollywood, than they do with the 1800s railway companies from which they are derived. Companies are beginning to function like movie studios; externalizing supporting functions such as production and distribution to allow them to focus on identifying worthy stories in their genre of interest, or the problems they choose to focus on; and then blending internal management and guidance with external capabilities to create vehicles to exploit the opportunities they have identified, with highly skill free agents, producers and actors or knowledge workers and subject matter experts, bringing their unique world view which will draw together the threads of an engagement, taking it from the mundane and making it into something special.

World of Warcraft provides gamers with a platform that enables them to solve this problem, dynamically forming teams for a population of individuals. Leadership emerges organically, an attribute of the environments and context in which the people are acting, and lasts only as long as the task at hand before the team dissolves and the individuals find their way to new opportunities. World of Warcraft also provides the individuals with a career framework independent of any particular engagement or organization, empowering them to manage their own progression from defenseless cannon fodder to all powerful wizard (or warrior).

The concept of using elements of game play mechanics outside a formal game — known as gamification – is growing support outside the narrow confines of the game industry, this interest is, however, typically focused on the consumer space, and seen as a tool to encourage people to adopt applications or as a useful talent management tool to help develop leadership skills. Massively-multiplayer online role playing games[1] (MMORPG) seem to provide a grander opportunity by enabling us to create fluid and adaptable frameworks which allow both organizations and individuals to work together toward shared goals in the short term, whilst also providing them with the room to grow their skills in the longer term.

The concepts behind World of Warcraft’s success have a long heritage, with roots reaching back to 1974 when Dungeons & Dragons (D&D) was first released. Originally designed by Gary Gygax and Dave Arneson, D&D was derived from miniature wargames and is widely regarded as the beginning of modern role-playing games and the role-playing game industry.

Young geeks engaged in a D&D like role playing game in a scene from Steven Spielburg’s 1982 film, E.T.

Young geeks engaged in a D&D like role playing game in a scene from Steven Spielburg’s 1982 film, E.T.

D&D provided gamers with a framework to go on an adventure together by allowing them to create characters, virtual personas, . The game defined a set of professions (a Cleric, the Fighting man, and a Magic-User, in the first edition of the rules) and races (human, elf, dwarf, halfling[2] and gnome), established the mechanics of determining if a character was successful in their actions, and provided a system for individuals to measure the experience their character had accumulated, making them more skillful. Players could also tune their characters by tweaking the character’s physical attributes – strength, dexterity, constitution, intelligence, wisdom and charisma – as well as by acquiring virtual equipment and tools.

Playing D&D is a multi-week, or multi-month, journey where a party of friends would work together to explore a land, engage in quests, solve puzzles, crawl through dungeons and slay dragons (and other mythological monsters). Over time the rules developed by adding new professions, new races and by building more sophisticated experience models, become more complex in the process. (Too complex for some though, who prefer the original, simpler, rules)

The D&D character sheet for Sam Wisewhiskers, a mouse thief created by Tony Diterlizzi.

The D&D character sheet for Sam Wisewhiskers, a mouse thief created by Tony Diterlizzi.

World of Warcraft used Dungeons and Dragons as a starting point, addressing on of the major challenges in playing the game: forming a party of suitable friends to go exploring. Blizzard Entertainment (the company which develops and supports the game) created an online environment – an entire virtual world – where individual can login, create a character and start to explore. Players can start out as individuals, but to advance rapidly to higher levels they soon find that they must participate in teams, called guilds, and embark on increasingly challenging quests. The game changes with the players’ actions and game developers add new levels of quests as players become more proficient. There are also no set rules for winning the game or for forming a guild.

World of Warcraft as seen from the outside world.

World of Warcraft as seen from the outside world.

Forming, storming, norming and performing

The quest teams in World of Warcraft form organically around the goal, with an initial few reaching out into their (social) network to find the individuals they need, the individuals focused on solving the types of problems they team expects to find on their journey. It’s not enough to identify a fighter or thief or supply chain expect, for example, as the characters skills need to be match to the expected challenges and the teams ways of working. The final team will pull in a diverse range of characters and skills: some are priests, some are warriors, others are magis, some have different skill levels, different expertise, different potions, and different abilities. The planning processes is spread across in-game forums, as well as a plethora of Internet forums and wikis outside the game. Leadership emerges organically, reflecting the group consensus of whom has the best chance of leading them to success. And finally, the players need to work together, in real time, to conduct the mission and achieve their goal.

The team formation processes deal with a number of significant challenges which also exist in the offline world. How to pick team members, weeding out the incompetent and fostering relationships with the competent. The games forces the team to determine – as a group – what additional skill sets are needed and available at any given time, as well as understanding how different people (with different personalities and styles) will work together. Planing a large raid or quest is also not a task that comes together easily, and leaders must identify the people willing to word toward the goal whilst providing members with enough notice of the team’s activities to enable them to fit the game into their schedule. For the team to reach its gaol, every team member needs to play their role while working together to adapt to changing circumstances.

If the team does fail to reach its goal, when the team must take a step back, reevaluate its plan and team structure, and come up with a strategy to avoid the problem next time round. Leadership also needs to deal with the reality of under performers. Sometimes they’re just bad players. Other times they want to do better but don’t know how, and need a little guidance. And when everything doesn’t go to plan it’s important to determine what when wrong, as well as highlighting what went right.

As in life, investing time in the team will result in the team improving. People also have lives outside of the game, just as they have lives outside of work, and balancing the conflicting demands of life, game and work means that situations arise when people can’t always be where they said they would be (while there should always be consequences for people who rarely live up to their commitments). The world that is World of Warcraft is also constant changing, forcing players to rely on each other and invent new tactics and techniques to succeed in the rapidly changing environment, forcing guild members into a mode of constant collaboration and invention.

World of Warcraft shows us the outline of a new approach to to forming, storming, norming and performing[3]. Clearly defined goals provide a nucleus which the team can form around, acting as a yardstick to measure the skills required as well as helping to establish what success looks like (including how each team member’s contribution will be measured). The skills that the character model articulates provides team leaders with a way of understanding each potential members strengths and weaknesses, their interest in the endeavor and the problems they solve. The challenge for organizations is to develop a game framework for themselves: a set of policies and rules which allow individuals to articulate the skills they have and the problems they’re interested in solving, and which enable experience to be apportioned after the engagement.

Different ways of working

In our increasingly diverse environment, we must often construct our teams with people who solve problems in different ways, and who have a range of different ways of learning and working. Differences in working styles between cohorts are even used to explain while one cohort should be more creative, innovative, productive or reliable than another.

Traditionalists
(64 – 84)		Boomer
(64 – 84)		Gen X
(26 – 44)		Millennials
(18 – 25)
TrainingThe hard wayToo much and I'll leaveRequired to keep meContinuous and expected
Learning styleClassroomFacilitatedIndependentCollaborative and networked
Communication styleTop-downGuardedHub and spokeCollaborative
Problem solvingHierarchicalHorizontalIndependentCollaborative
Decision makingSeeks approvalTeam informedTeam includedTeam decided
Leadership styleCommand and controlGet out of the wayCoachPartner
FeedbackNo news is good newsOnce per yearWeekly/dailyOn demand
Technology useUncomfortableUnsureUnable to work without itUnfathomable if not provided
Job changingUnwiseSets me backNecessaryPart of my daily routine
[4]

Organizations struggle with incompatible working styles, with Gen Y’s desire for constant feedback and a Traditionalist’s favor of top-down command and control, with entire books being written on the topic.

Rather than a boat anchor, diverse teams – pulling in people from a broad range of backgrounds and age groups – can actually produce some of the most effective solutions, as Scott E. Page, author of The Difference[5], found. Just as age is a poor indicator of an individuals ability to adapt to the changing environment, ago is also a poor factor in determining the working style an individual might favor or their ability to work with others who have a different style. In their book A New Culture of Learning[6], Douglas Thomas and John Seely Brown describe two “hard-core gamers.” “Ambitious and risk-taking” Nick has “fast reflexes” when playing. Yet he enjoys working with his guild mate Becky who “relies on patience, careful strategy, and knowledge of the game.” What makes this even more fascinating is that Becky is Nick’s mother.

This is not the first time that personality has been seen as a factor in determining working styles. The nineties brought us tools such as Myers-Briggs[7] and FIRO[8] which enable us to measure our personalities and those of our employees. The hope was that a better understanding of interpersonal dynamics would promote a smoother and more productive work environment.

The Myers-Briggs types and their distribution across the population.

The Myers-Briggs types and their estimated frequency across the population. As you can see, the data suggest that those who prefer Sensing are more frequent in the population than those who prefer Intuition. Source: The Myers & Briggs Foundation.

The world is changing faster than ever and our skill sets have a shorter and shorter shelf life. In this environment the highly entailed, and highly trained specialist will find that their carefully guarded skills and ways of working will rapidly change from advantage to problem unless they are willing to adapt to the environment around them. Strategies which resist a constantly changing world are insufficient to keep up, and organizations need to embrace the diverse and organically formed teams that can enable them – as it does the guilds in World of Warcraft – to succeed in a rapidly changing environment.

Continued in Problems and the people who solve them.


References


1. Massively multiplayer online role-playing game (MMORPG) is a genre of role-playing video games in which a very large number of players interact with one another within a virtual game world.↑
2. Hobbits in all but name.↑
3. Forming, storming, norming and performing is a model of group development developed by Bruce Tuckman in 1965, who maintained that these phases are all necessary and inevitable in order for the team to grow, to face up to challenges, to tackle problems, to find solutions, to plan work, and to deliver results.↑
4. Adapted from IBM report : “Driving Workforce Productivity by Enabling Social Connection “ (June 2009)↑
5. Scott E. Page (2007), The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools and Societies, Princeton University Press.↑
6. Douglas Thomas and John Seely Brown (2011), A New Culture of Learning: Cultivating the Imagination for a World of Constant Change, CreateSpace.↑
7. Myers-Briggs Type Indicator (MBTI) is a psychometric questionnaire designed to measure psychological preferences in how people perceive the world and make decisions, which Myers and Briggs extrapolated from Jung’s writings in his book Psychological Types.↑
8. Fundamental Interpersonal Relations Orientation (FIRO) is a theory of interpersonal relations, introduced by William Schutz in 1958.↑

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