Tag Archives: IBM

World of Warcraft in the workplace

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.

[[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.[[1]]

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.

[[2]]Hobbits in all but name.[[2]]

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.

[[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.[[3]]

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.

[table id=1 /]{{4}}

[[4]]Adapted from IBM report : “Driving Workforce Productivity by Enabling Social Connection “ (June 2009)[[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.

[[5]]Scott E. Page (2007), The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools and Societies, Princeton University Press.[[5]]
[[6]]Douglas Thomas and John Seely Brown (2011), A New Culture of Learning: Cultivating the Imagination for a World of Constant Change, CreateSpace.[[6]]
[[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.[[7]]
[[8]]Fundamental Interpersonal Relations Orientation (FIRO) is a theory of interpersonal relations, introduced by William Schutz in 1958.[[8]]

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.

Consulting doesn’t work any more. We need to reinvent it.

What does it mean to be in consulting these days? The consulting model that’s evolved over the last 30 – 50 years seems to be breaking down. The internet and social media have shifted the way business operates, and the consulting industry has failed to move with it. The old tricks that the industry has relied on — the did it, done it stories and the assumption that I know something you don’t — no longer apply. Margins are under pressure and revenue is on the way down (though outsourcing is propping up some) as clients find smarter ways to solve problems, or decide that they can simply do without. The knowledge and resources the consulting industry has been selling are no longer scarce, and we need to sell something else. Rather than seeing this as a problem, I see it as a huge opportunity; an opportunity to establish a more collaborative and productive relationship founded on shared, long term success. Sell outcomes, not scarcity and rationing.

I’m a consultant. I have been for some time too, working in both small and large consultancies. It seems to me that the traditional relationship between consultancy and client is breaking down. This also appears to be true for both flavours of consulting: business and technology. And by consulting I mean everything from the large tier ones down to the brave individuals carving a path for themselves.

Business is down, and the magic number seems to be roughly a 17% decline year-on-year. One possible cause might be that the life blood of the industry — the large multi-year transformation project — has lost a lot of its attraction in recent years. If you dig around in the financials for the large publicly listed consultancies and vendors you’ll find that the revenue from IT estate renewal and transformation (application licenses, application configuration and installation services, change management, and even advisory) is sagging by roughly 17% everywhere around the globe.

SABER @ American Airlines

Large transformation projects have lost much of their attraction. While IBM successfully delivered SABER back in the 60s, providing a heart transplant for American Airlines ticketing processes, more recent stabs at similarly sized projects have met with less than stellar results. Many more projects are quietly swept under the carpet, declared a success so that involved can move on to something else.

The consulting model is a simple one. Consultants work on projects, and the projects translate into billable hours. Consultancies strive to minimise overheads (working on customer premises and minimising support staff), while passing incidental costs through to clients in the form of expenses. Billable hours drive revenue, with lower grades provide higher margins.

This creates a couple of interesting, and predictable, behaviours. First, productivity enhancing tooling is frowned on. It’s better to deploy a graduate with a spreadsheet than a more senior consultant with effective tooling. Second, a small number of large transactions are preferred to a large number of small transactions. A small number of large transactions requires less overhead (sales and back-office infrastructure).

All this drives consultancies to create large, transformational projects. Advisory projects end up developing multi-year (or even multi-decade) roadmaps to consolidate, align and optimise the business. Technology projects deliver large, multi-million dollar, IT assets into the IT estate. These large, business and IT transformation projects provide the growth, revenue and margin targets required to beat the market.

This desire for large projects is packaged up in what is commonly called “best practice”. The consulting industry focuses on did it, done it stories, standard and repeatable projects to minimise risk. The sales pitch is straight-forward: “Do you want this thing we did over here?” This might be the development of a global sourcing strategy, an ERP implementation, …

Spencer Tracy & Katharine Hepburn in The Desk Set
Spencer Tracy & Katharine Hepburn in The Desk Set

This approach has worked for some time, with consultancy and client more-or-less aligned. Back when IBM developed SABER you were forced to build solutions from the tin up, and even small business solutions required significant effort to deliver. In the 1957, when Spencer Tracy played a productivity expert in The Desk Set, new IT solutions required very specific skills sets to develop and deploy. These skills were in short supply, making it hard for an organisation to create and maintain a critical mass of in-house expertise.

Rather than attempt to build an internal capability — forcing the organisation on a long learning journey, a journey involving making mistakes to acquire tacit knowledge — a more pragmatic approach is to rent the capability. Using a consultancy provides access to skills and knowledge you can’t get elsewhere, usually packaged up as a formal methodology. It’s a risk management exercise: you get a consultancy to deliver a solution or develop a strategy as they just did one last week and know where all the potholes are. If we were cheeky, then we would summerize this by stating that consultancies have a simple value proposition: I know something you don’t!

It’s a model defined by scarcity.

A lot has changed in the last few years; business moves a lot faster and a new generation of technology is starting to take hold. The business and technology environment is changing so fast that we’re struggling to keep up. Technology and business have become so interwoven that we now talk of Business-Technology, and a lot of that scarce knowledge is now easily obtainable.

The Diverging Pulse Rates of Business and Technology
The Diverging Pulse Rates of Business and Technology

The scarce tacit knowledge we used to require is now bundled up in methodologies; methodologies which are trainable, learnable, and scaleable. LEAN and Six Sigma are good examples of this, starting as more black art than science, maturing into respected methodologies, to today where certification is widely available and each methodology has a vibrate community of practitioners spread across both clients and consultancies. The growth of MBA programmes also ensures that this knowledge is spread far and wide.

Technology has followed a similar path, with the detailed knowledge required to develop distributed solutions incrementally reified in methodologies and frameworks. When I started my career XDR and sockets were the networking technologies of the day, and teams often grew to close to one hundred engineers. Today the same solution developed on a modern platform (Java, Ruby, Python …) has a team in the single digits, and takes a fraction of the time. Tacit knowledge has be reified in software platforms and frameworks. SaaS (Software as a Service) takes this to a while new level by enabling you to avoid software development entirely.

The did it, done it stories that consulting has thrived on in the past are being chewed up and spat out by the business schools, open source, and the platform and SaaS vendors. A casual survey of the market usually finds that SaaS-based solutions require 10% of the installation effort of a traditional on-premsis solution. (Yes, that’s 90% less effort.) Less effort means less revenue for the consultancies. It also reduces the need for advisory services, as provisioning a SaaS solution with the corporate credit card should not require a $200,000 project to build a cost-benefit analysis. And gone are the days when you could simply read the latest magazines and articles from the business schools, spouting what you’d read back to a client. Many clients have been on the consulting side of the fence, have a similar education in the business schools, and reads all the same articles.

I know and you don’t! no longer works. The world has moved on and the consulting industry needs to adapt. The knowledge and resources the industry has been selling are no longer scarce, and we need to sell something else. I see this is a huge opportunity; an opportunity to establish a more collaborative and productive relationship founded on shared, long term success. As Jeff Jarvis has said: stop selling scarcity, sell outcomes.

Updated: A good friend has pointed out the one area of consulting — one which we might call applied business consulting — resists the trend to be commoditized. This is the old school task of sitting with clients one-on-one, working to understand their enterprise and what makes it special, and then using this understanding to find the next area or opportunity that the enterprise is uniquely qualified to exploit. There’s no junior consultants in this area, only old grey-beards who are too expensive to stay in their old jobs, but that still are highly useful to the industry. Unfortunately this model doesn’t scale, forcing most (if not all) consultancies into a more operational knowledge transfer role (think Six Sigma and LEAN) in an attempt to improve revenue and GOP.

Updated: Keith Coleman (global head of public sector at Capgemini Consulting) makes a similar case with Time to sell results, not just advice (via @rpetal27).

Updated: I’ve responded to my own post, tweaking my consulting page to capture my take on what a consultant needs to do in this day and age.

Innovation [2009-10-05]

Another week and another collection of interesting ideas from around the internet.

As always, thoughts and/or comments are greatly appreciated.

This issue:

Why we can’t keep up

We’re struggling to keep up. The pace of business seems to be constantly accelerating. Requirements don’t just slip anymore: they can change completely during the delivery of a solution. And the application we spent the last year nudging over the line into production became instant legacy before we’d even finished. We know intuitively that only a fraction of the benefits written into the business case will be realized. What do we need to do to get back on top of this situation?

We used to operate in a world where applications were delivered on time and on budget. One where the final solution provided a demonstrable competitive advantage to the business. Like SABER, and airline reservation system developed for American Airlines by IBM which was so successful that the rest of the industry was forced to deploy similar solutions (which IBM kindly offered to develop) in response. Or Walmart, who used a data warehouse to drive category leading supply chain excellence, which they leveraged to become the largest retailer in the world. Both of these solutions were billion dollar investments in todays money.

The applications we’ve delivered have revolutionized information distribution both within and between organizations. The wave of data warehouse deployments triggered by Walmart’s success formed the backbone for category management. By providing suppliers with a direct feed from the data warehouse—a view of supply chain state all the way from the factory through to the tills—retailers were able to hand responsibility for transport, shelf-stacking, pricing and even store layout for a product category to their suppliers, resulting in a double digit rises in sales figures.

This ability to rapidly see and act on information has accelerated the pulse of business. What used to take years now takes months. New tools such as Web 2.0 and pervasive mobile communications are starting to convert these months into week.

Take the movie industry for example. Back before the rise of the Internet even bad films could expect a fair run at the box-office, given a star billing and strong PR campaign too attract the punters. However, post Internet, SMS and Twitter, the bad reviews have started flying into punters hands moments after the first screening of a film has started, transmitted directly from the first audience. Where the studios could rely a month or of strong returns, now that run might only last hours.

To compensate, the studios are changing how they take films to market; running more intensive PR campaigns for their lesser offerings, clamping down on leaks, and hoping to make enough money to turn a small profit before word of mouth kicks in. Films are launched, distributed and released to DVD (or even iTunes) in weeks rather than months or years, and studios’ funding, operations and the distribution models are being reconfigured to support the accelerated pace of business.

While the pulse of business has accelerated, enterprise technology’s pulse rate seems to have barely moved. The significant gains we’ve made in technology and methodologies has been traded for the ability to build increasingly complex solutions, the latest being ERP (enterprise resource planning) whose installation in a business is often compared to open heart surgery.

The Diverging Pulse Rates of Business and Technology

This disconnect between the pulse rates of business and enterprise technology is the source of our struggle. John Boyd found his way to the crux of the problem with his work on fighter tactics.

John Boyd—also know as “40 second Boyd”—was a rather interesting bloke. He had a standing bet for 40 dollars that he beat any opponent within 40 seconds in a dog fight. Boyd never lost his bet.

The key to Boyd’s unblemished record was a single insight: that success in rapidly changing environment depends on your ability to orient yourself, decide on, and execute a course of action, faster than the environment (or your competition) is changing. He used his understanding of the current environment—the relative positions, speed and performance envelopes of both planes—to quickly orient himself then select and act on a tactic. By repeatedly taking decisive action faster than his opponent can react, John Boyd’s actions were confusing and unpredictable to his opponent.

We often find ourselves on the back foot, reacting to seemingly chaotic business environment. To overcome this we need to increase the pulse of IT so that we’re operating at a higher pace than the business we support. Tools like LEAN software development have provided us with a partial solution, accelerating the pulse of writing software, but if we want to overcome this challenge then we need to find a new approach to managing IT.

Business, however, doesn’t have a single pulse. Pulse rate varies by industry. It also varies within a business. Back office compliance runs at a slow rate, changing over years as reporting and regulation requirements slowly evolve. Process improvement and operational excellence programs evolve business processes over months or quarters to drive cost out of the business. While customer or knowledge worker facing functionality changes rapidly, possibly even weekly, in response to consumer, marketing or workforce demands.

Aligning technology with business

We can manage each of these pulses separately. Rather than using a single approach to managing technology and treating all business drivers as equals, we can segment the business and select management strategies to match the pulse rate and amplitude of each.

Sales, for example, is often victim of an over zealous CRM (customer relationship management) deployment. In an effort to improve sales performance we’ll decide to role out the latest-greatest CRM solution. The one with the Web 2.0 features and funky cross-sell, up-sell module.

Only of a fraction of the functionality in the new CRM solution is actually new though—the remainder being no different to the existing solution. The need to support 100% of the investment on the benefits provided by a small fraction of the solution’s features dilutes the business case. Soon we find ourselves on the same old roller-coaster ride, with delivery running late,  scope creeping up, the promised benefits becoming more intangible every minute, and we’re struggling to keep up.

There might be an easier way. Take the drugs industry for example. Sales are based on relationships and made via personal calls on doctors. Sales performance is driven by the number of sales calls a representative can manage in a week, and the ability to answer all of a doctor’s questions during a visit (and avoid the need for a follow-up visit to close the sale). It’s not uncommon for tasks unrelated to CRM—simple tasks such as returning to the office to process expenses or find an answer to a question—to consume a disproportionate amount of time. Time that would be better spent closing sales.

One company came up with an interesting approach. To support the sales reps in the field they provided them with the ability to query the team back in the office, answering a clients question without the need to return to head office and then try to get back in their calendar. The solution was to deploy a corporate version of Twitter, connecting the sales rep into the with the call center and all staff using the company portal via a simple text message.

By separating concerns in this way—by managing each appropriately—we can ensure that we are working at a faster pace than the business driver we supporting. By allocating our resources wisely we can set the amplitude of each pulse. Careful management of the cycles will enable us to bring business and technology into alignment.