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Marshall Model

Most Models Are Wrong

“The most that can be expected from any model is that it can supply a useful approximation to reality: All models are wrong; some models are useful”.

~ George E. P. Box

George E. P. Box

George Edward Pelham Box FRS (18 October 1919 – 28 March 2013) was a British statistician, who worked in the areas of quality control, time-series analysis, design of experiments, and Bayesian inference. He has been called “one of the great statistical minds of the 20th century”. He repeated his aphorism concerning the wrongness of models in many of his papers.

The first appearance (1976) reads:

“Since all models are wrong the scientist cannot obtain a “correct” one by excessive elaboration. On the contrary following William of Occam he should seek an economical description of natural phenomena. Just as the ability to devise simple but evocative models is the signature of the great scientist so overelaboration and overparameterization is often the mark of mediocrity.”

 ~ George E. P. Box

He wrote later (1978):

Now it would be very remarkable if any system existing in the real world could be exactly represented by any simple model. However, cunningly chosen parsimonious models often do provide remarkably useful approximations. For example, the law PV = RT relating pressure P, volume V and temperature T of an “ideal” gas via a constant R is not exactly true for any real gas, but it frequently provides a useful approximation and furthermore its structure is informative since it springs from a physical view of the behavior of gas molecules.

For such a model there is no need to ask the question “Is the model true?”. If “truth” is to be the “whole truth” the answer must be “No”. The only question of interest is “Is the model illuminating and useful?”.

~ George E. P. Box

What’s A Model?

The Marshall model belongs to the group of models collectively referred-to as Scientific Models.

“A scientific model seeks to represent empirical objects, phenomena, and physical processes in a logical and objective way. All models are in simulacra, that is, simplified reflections of reality that, despite being approximations, can be extremely useful. Building and disputing models is fundamental to the scientific enterprise. Complete and true representation may be impossible, but scientific debate often concerns which is the better model for a given task.

Attempts to formalize the principles of the empirical sciences use an interpretation to model reality, in the same way logicians axiomatize the principles of logic. The aim of these attempts is to construct a formal system that will not produce theoretical consequences that are contrary to what is found in reality. Predictions or other statements drawn from such a formal system mirror or map the real world only insofar as these scientific models are true.

For the scientist, a model is also a way in which the human thought processes can be amplified.”

“Models are typically used when it is either impossible or impractical to create experimental conditions in which we can directly measure outcomes. Direct measurement of outcomes under controlled conditions (see Scientific Method) will always be more reliable than modelled estimates of outcomes.”

The Marshall Model

I’ve written a number of blogs posts (plus a White Paper) on the Marshall Model, and its relationship with Rightshifting, so I’ll not repeat that material here.

How is the Marshall Model Useful?

  • Explains the fundamental source of productivity – or lack of it – in organisations generally.
  • Predicts the likely path of attempts to “go Agile or “be Agile”, embark on Digital Transformations, adopt Lean or Theory of Constraints, etc..
  • Situates a range of approaches to business productivity along a spectrum (the Rightshifting spectrum), in order of effectiveness.
  • Defines the challenge facing organisations that wish to significantly improve their productivity and effectiveness.
  • Illustrates the role of the collective psyche (within social systems).
  • Offers a way forward to higher productivity, joy, engagement and seeing folks’ needs better met.
  • Provides interventionists with insights in how to intervene in organisations seeking to improve, similar to the way the Dreyfus Model provides interventionists with insights in how to intervene in situations where individuals seek to improve their skills. (How to best adapt and adopt styles of intervention to suit where the organisation is at, in its journey towards maximum effectiveness).
  • Offers a seed for building a shared mental model of the factors governing an organisation’s relative effectiveness, as well as a means to understand the mental models typically in play within organisations.

Some time ago I wrote a post on how folks might use the Marshall Model.

Aside: Please let me know if you would value an elaboration of any of the above points.

Summary

“Truth … is much too complicated to allow anything but approximations.”

~ John von Neumann

The Marshall Model is not Truth. It is truthy, in that it has some utility as described above. It is a hypothesis, one I’d be delighted for folks to debate, dispute and discuss. Do you have, for example, your own go-to model for explaining organisational productivity? Where does the Marshall Model sit, for you, on the spectrum of “highly useful” through to “not very useful at all”? Would you be willing to share your viewpoint or hypothesis on organisational effectiveness and productivity?

– Bob

Further Reading

All Models are Wrong ~ Wikipedia Entry
Scientific Modelling ~ Wikipedia Entry
George E.P. Box ~ Wikipedia Entry
Mental Models ~ Wikipedia Entry
Models Are The Building Blocks of Science https://utw10426.utweb.utexas.edu/Topics/Models/Text.html

World Class? Really?

Some six years ago now, I wrote a post describing what might characterise a world class software / product development / collaborative knowledge work business.

In the interim, I’ve had some opportunities to work on these ideas for various clients. My consequent experiences, whilst in no way invalidating that post, have thrown up different perspectives on the question of “world class”.

Firstly, do you want it? Moving towards becoming a world class business involves a shed load of work, over many years. Do you want to commit to that effort? Even though the goal sounds noble, ambitious, attractive, does your business have what it takes to even begin the journey in earnest, let alone stick at it.

Then, do you need it? Absent powerful drivers spurring you on towards the goal, will you have the grit necessary to keep at it? Or will the initiative flounder and drown in the minutiae of daily exigencies, such as the constant pressure to get product and features out the door, to keep investors satisfied with (short term) results, etc.? And is the ROI there, in your context? If you do keep on the sometime joyful, sometimes wearysome path, and attain “world class” status, will the effort pay back in terms of e.g. the bottom line?

If your answers to the preceding two questions are yes, then we can get down to considering the characteristics of a world class collaborative knowledge-work business. What might it look like, that goal state?

Here’s my current take.

Context

Just in case a little context might help, here’s a variant of the Rightshifting chart which illustrates world class in terms of relative effectiveness (i.e. how effective are world class organisations relative to their peers?) The yellow area highlights those organisations (those at least circa 2.5 times more effective than the median) we might consider world class:

WorldClass

Fields of Competency

Any world class collaborative knowledge-work business must have mastered a bunch of different fields of knowledge. That’s not to say everyone in the organisation needs to have reached mastery (Level 5 – see below) in every one of the follow fields. But there must be a widespread acquaintance with all these fields, and some level of individual competent in each.

I suggest the following Dreyfus-inspired model for characterising an individual’s (practitioner’s) level of competency (or action-oriented knowledge) in any given field:

Level One (Novice)

The Novice level in each Field invites practitioners to acquire the basic vocabulary and core concepts of the Field. Attainment criteria will specify the expected vocabulary and core concepts. The Novice level also invites practitioners to acquire and demonstrate the ability to read and understand materials (books, articles, papers, videos, podcasts, etc.) related to the vocabulary and core concepts of the Field.

Level Two (Advanced Beginner)

The Advanced Beginner level in each Field invites practitioners to acquire the ability to critique key artefacts commonly found in the given Field. The Advanced Beginner level also invites practitioners to read more widely, and understand different perspectives or more nuanced aspects of, and peripheral or advanced elements within the Field.

Level Three (Competent)

The Competent level in each Field invites practitioners to acquire and demonstrate a practical competency in the core concepts in the Field, for example through the ability to apply the concepts, or create key artefacts, unaided.
The Competent level also invites practitioners to acquire and demonstrate the ability to collaborate with others in exploring and applying the abilities acquired in the Novice and Advanced Beginner levels.

Level Four (Proficient)

The Proficient level in each Field invites practitioners to acquire and demonstrate the ability to prepare and present examples and other educational materials appropriate to the given Field. The Proficient level also invites practitioners to acquire and demonstrate the ability to coach or otherwise guide others in applying the abilities acquired in the Novice, Advanced Beginner and Competent levels.

Level Five (Master)

The Master level in each Field invites practitioners to acquire and demonstrate national or international thought leadership in the Field. This can include: making significant public contributions or extensions to the Field; becoming a publicly recognised expert in the Field; publishing books, papers and/or articles relevant to the Field; etc.

The Fields

Any business that aspires to world class status must attain effective competencies in a wide range of different fields. The following list suggests the fields I have found most relevant to collaborative knowledge-work business in general, and software / product tech businesses in particular:

Flow

  • Flow (product development) (n): the movement of the designs, etc., for a product or service through the steps of the design processes which create them.
  • Continuous Flow (n): The progressive movement of units of design through value-adding steps within a design process such that a product design or service design proceeds from conception into production without stoppages, delays, or back flows.
  • See also: Optimised Flow Demonstration (video)

Deming

  • * Many in Japan credit Bill Deming for what has become known as the Japanese post-war economic miracle of 1950 to 1960.
  • William Edwards Deming (October 14, 1900 – December 20, 1993) was an American engineer, statistician, professor, author, lecturer, and management consultant. Deming is best known for his work in Japan after WWII, particularly his work with the leaders of Japanese industry.

Risk Management

  • Risk management is the discipline and practice of explicitly identifying and managing key risks.

    “Risk Management is Project Management for grown-ups.”
    ~ DeMarco & Lister

  • Potential benefits include:
    • makes aggressive risk-taking possible
    • protects us from getting blindsided
    • provides minimum-cost downside protection
    • reveals invisible transfers of responsibility
    • isolates the failure of a subproject
  • Note; Many Agile practices are, at their heart, about risk management.

Mindset

  • Mindset a.k.a. collective (organisational) memeplex (n): A set of memes (ideas, assumptions, beliefs, heuristics, etc.) which interact to reinforce each other.

“A memeplex is a set of memes which, while not necessarily being good survivors on their own, are good survivors in the presence of other members of the memeplex.”
~ Richard Dawkins in The God Delusion

  • The “organisational mindset” is a set of beliefs about the world and the world of work which act to reinforce each other.
  • These interlocking beliefs tightly bind organisations into a straight-jacket of thought patterns which many find inescapable. Without coordinated interventions at multiple points in the memeplex simultaneously, these interactions will prevail, as will the status quo.

Requirements a.k.a. Needs Management

  • A more or less formal approach to identifying and communicating needs
  • Any approach that ensures that everyone involved in attending to the identified needs shares a clear understanding of the required outcome(s): “doing the RIGHT thing”.

Fellowship

  • A system of organisational governance based on the precepts of Situational Leadership and with a primary focus on the quality of interpersonal relationships as a means to improved organisational health and effectiveness.
  • More generally, paying attend to the quality and effectiveness of the collaborative relationships across and through the business (and the extended value network of which it is a part).

Cognitive Function

  • Cognitive function (Neurology) (n): Any mental process that involves symbolic operations–e.g. perception, memory, creation of imagery, and thinking; Cognitive Function encompasses awareness and capacity for judgment.
  • Effectiveness of collaborative knowledge work is dictated by both e.g. quality of interpersonal relationships and degree of Cognitive Function.
  • See also: Cognitive Science

PDCA

  • PDCA (plan–do–check–act, or plan–do–check–adjust) is an iterative four-step method used for the control and continuous improvement of processes and products. It is also known as the Deming circle/cycle/wheel, Shewhart cycle, control circle/cycle, or plan–do–study–act (PDSA).
  • Based on the scientific method, (Cf. Francis Bacon) e.g. “hypothesis” – “experiment” – “evaluation”.

Statistical Process Control (SPC)

  • Statistical process control (SPC) is a method of quality control which uses statistical methods. SPC is applied in order to monitor and control a process.
  • Key tools used in SPC include control charts; a focus on continuous improvement; and the design of experiments.
  • See also: The Red Beads and the Red Bead Experiment with Dr. W. Edwards Deming (video)

Lean Product Development

  • Lean Product Development applies ideas from Lean Manufacturing to the design and development of new products (See e.g. books by Allen Ward and Michael Kennedy)
  • Aims to improve the flow of new ideas “from concept to cash”.
  • Can also help raise levels of innovation.
  • Exemplar: TPDS (Toyota Product Development System)

Don Reinertsen’s Work

  • Don Reinertsen is the author of three of the most definitive and best-selling books on product development.
  • His 1991 book, Developing Products in Half the Time is a product development classic.
  • His 1997 book, Managing the Design Factory: A Product Developer’s Toolkit, was the first book to describe how the principles of Just-in-Time manufacturing could be applied to product development. In the past 16 years this approach has become known as Lean Product Development.
  • His latest award-winning book, The Principles of Product Development Flow: Second Generation Lean Product Development, has been praised as, “… quite simply the most advanced product development book you can buy.”

Neuroscience

  • (Cognitive) neuroscience is concerned with the scientific study of the biological processes and aspects that underlie cognition, with a specific focus on the neural connections in the brain which are involved in mental processes.
  • (Cognitive) neuroscience addresses the questions of how psychological/cognitive activities are affected or controlled by neural circuits in the brain. Cognitive neuroscience is a branch of both psychology and neuroscience, overlapping with disciplines such as physiological psychology, cognitive psychology, and neuropsychology.
  • See also: Cognitive Function

Theory of Constraints

  • The Theory of Constraints (TOC) is a management paradigm originated by Eliyahu M. Goldratt.
  • TOC proposes a scientific approach to improvement. It hypothesises that every complex system, including manufacturing processes, consists of multiple linked activities, just one of which acts as a constraint upon the entire system (the “weakest link in the chain”).
  • TOC has a wide range of “thinking tools” which together form a coherent problem-solving and change management system.

Self-organisation

  • Self-organisation (n): Ability of a system to spontaneously arrange its components or elements in a purposeful (non-random) manner. It is as if the system knows how to ‘do its own thing.’ Many natural systems such as cells, chemical compounds, galaxies, organisms and planets show this property. Animal and human communities too display self-organization.

    “An empowered organization is one in which individuals have the knowledge, skill, desire, and opportunity to personally succeed in a way that leads to collective organisational success.”
    ~ Stephen R. Covey

Quantification

  • In mathematics and empirical science, quantification is the act of counting and measuring that maps human sense observations and experiences into members of some set of numbers. Quantification in this sense is fundamental to the scientific method.
  • See also: Tom Gilb

Systems Thinking

  • Systems thinking provides a model of decision-making that helps organisations effectively deal with change and adapt.
  • It is a component of a learning organisation – one that facilitates learning throughout the organisation to transform itself and adapt.
  • See also: Peter Senge, Russell L. Ackoff, Donella Meadows, etc.

Psychology

  • Psychology (n): the study of behaviour and mind, embracing all aspects of conscious and unconscious experience as well as thought. It is an academic discipline and an applied science which seeks to understand individuals and groups.

Argyris

  • An American business theorist, Professor Emeritus at Harvard Business School, and known for his work on interpersonal communication, organisational effectiveness, double-loop learning and learning organisations.
  • See also: Action Science.

Psychotherapy

  • Psychotherapy (n): interventions which facilitate the shifting of perspectives and attitudes, and thus, human behaviours.
  • See also: Organisational Psychotherapy

To the above list of Fields, I invite you to add any which may have specific resonance or relevance to your own business.

And then there are the lists of technical capabilities you need to be present in your various business functions, too.

Aside – CMMI

As an aside, CMMI also provides an extensive list of “capability areas” ( circa 128 different areas, last time I looked) focussed on engineering capabilities. Note: I find the CMMI list useful, but only as a primer, not as a full-blown recipe for success.

Summary

All the above begs the question: how to get there? And, how close are you to world class, so far?

– Bob

Reliability and Effectiveness

Many times when presenting either the Rightshifting curve:

or the Marshall Model:

I have been asked to define “Effectiveness” (i.e. the horizontal axis for both of these charts). I have never been entirely happy with my various answers. But I have recently discovered a definition for effectiveness, including a means to measure it, which I shall be using from now on. This definition is by Goldratt, as part of Theory of Constraints, and appears in his audiobook “Beyond the Goal”.

Measurements

Measurements serve us in two ways:

  1. As indicators of where we are, so we know where to go. For example, the dials and gauges on a car’s dashboard.
  2. As means to induce positive behaviours.

We must always remember, though, that we are dealing with humans and human-based organisations:

“Tell you how you measure me and I’ll tell you how I behave.” ~ Goldratt

We must choose measurements to induce the parts to do what’s better for the company as a whole. If a measurement jeopardises the performance of the system as a whole, the measurement is wrong.

Companies already have one set of measurements which measure their performance as a whole: their Financial measurements: e.g. Net profit (P&L) and investment (Balance Sheet)

What about when we dive inside the company as a whole, though? We then have two areas in which we have to conduct measurements:

  1. Support for and evaluation of management decisions
  2. Oversight on execution (how well are we executing on the decisions we’ve made?)

We generally don’t have good measurements in terms of decisions, nor good measurements in terms of execution.

We have to remember we’re dealing with human beings. And as long as we’re dealing with human beings, we have to realise that by judging any person on more than five measure, we’re creating anarchy. Simply because, with more than five measurements, people can basically do whatever they like, and likely still score high on one of them. And their bosses can nail them on some measurement they fail to deliver against. More than five measurements is conceptually wrong.

Categories of Measurement

So, how to categorise thing so that human beings can grasp the situation? Can we do better than we do now? Theory of Constraints suggests we can.

What resources do we have to help us formulate measurements in each of the above two areas; management decision-making, and execution of those decisions?

  • For decision-related measurements – there are lots of resources available to help e.g. books on Throughput Accounting.
  • For execution-related measurements – there is next to nothing published anywhere.

Continuous Improvement

I’ll not make the case for continuous improvement here. But if we wish to induce people to continuously improve, where should we focus our measurements? On things that are done properly, or on things that are not done properly? Which of these two foci better drives action? Focussing on the things we’re doing properly tends not to drive improvement. So we must concentrate on things that are not done properly.

How many things are not done properly? Kaplan suggests that in most businesses, there are more than twenty categories of things that are not done properly. But for humans to grasp our measures, we have already decided we need at most five categories, categories that completely cover everything that is not done properly, with zero overlap or duplication. Finding a way to categorise things that meets our criteria here is a nontrivial challenge.

Goldratt says there are only two categories:

  1. Things that should have been done but were not.
  2. Things that should not have been done but nevertheless were done.

Just two categories, with zero overlap. Beautifully simple.

And each of the above two categories already have a word defining them:

  1. Things that should have been done but were not – unreliability.
  2. Things that should not have been done but nevertheless were done – ineffectiveness.

Let’s swap these around into positive terms: Reliability, and Effectiveness.

Lovely.

Reliability and Effectiveness

Can we find measures to quantify Reliability and Effectiveness? How can we put numbers on our reliability? How can we put numbers on our effectiveness? Because, without numbers, we’re not measuring.

Let’s consider what is the end result of being reliable, in terms of the system as a whole. And what is the end result of being effective, in terms of the system as a whole? Not in financial terms though, as reliability and effectiveness are not financial things. We know this intuitively.

Reliability

Things that should have been done but were not.

The end result of being unreliable, in terms of the system as a whole, is that the company fails to fulfil its commitments to the external world. In other words, the company fails to ship on time. Do we already measure on-time shipment? Yes. We call it Due Date Performance. That’s a measure of how much we ship on time. “Our company Due Date Performance is 90%”. The unit of measure is almost always “percent”. What behaviour does this unit of measure trigger? Does it trigger behaviour that is good for the company? No. It encourages us to sacrifice on-time shipment of difficult, larger shipments in favour of smaller, easier shipments. So the dollar value of the sale must be part of any reliability measurement. We cannot ignore the dollar value. And neither is time is a factor in percent units. How late is each late shipment? We must include time, too. So, let’s change our “Reliability” units from “percent” to “Throughput dollar days” – the sales dollar value of each orders that is late, multiplied by the number of days it is late, summed across all late orders. The sum total is the measurement of our (un)reliability.

This is of course  a new unit of measure: Throughput-dollar-days. To infer trends, or to compare the performance of e.g. groups or companies, we will need time to train our intuition in the significance of this new unit of measure. As we begin to get to grips with this new unit of measure, it can help to present it as an indicator (a number in some fixed range, say 1-10, or as we use in Rightshifting, and the Marshall Model, 0-5) until we have adjusted to the Throughput-dollar-days measure.

Effectiveness

Things that should not have been done but nevertheless were done.

If we do things that we should NOT have been doing, what is the end result? Inventory. Do we already measure inventory? Of course we do. But how do we presently measure inventory? Either in terms of a dollar value, for example “$6 million of finished good inventory”, or in terms of a number of days, for example “60 days of finished goods inventory”. But both dollars AND time are important. Existing units of measurement for inventory drive unhelpful local behaviours like over-production and poor flow. So, how to measure to induce helpful behaviours? For each item of inventory, let’s use the dollar value of the inventory multiplied by the number of days that we’re holding that inventory under our local authority. We’ll call this unit of measure “Inventory-dollar-days”.

And one more measure of effectiveness: local operating expense. (For example, scrap, or salaries – with a given subunit of the company).

Note: We can fold quality into these measures simply by not recognising a sale, or a reduction in inventory, until the customer accepts the items (i.e. until the items meet the customer’s quality standards).

Summary

Now we have means for defining effectiveness, (and reliability) in a way in which we can also measure it. I feel very comfortable with that.

– Bob

Further Reading

Beyond the Goal ~ Eliyahu M. Goldratt (Audiobook only)

Relevance Lost: Rise and Fall of Management Accounting ~ Kaplan & Johnson

The Goal ~ Eliyahu M. Goldratt

Throughput Accounting ~ Thomas Corbett

The Balanced Scorecard: Translating Strategy into Action ~ Kaplan & Norton

Strategies, Effective and Ineffective

[Tl;Dr: The effectiveness of any organisation is a function of the alignment between folks’ collective beliefs and assumptions about business, and the realities of business.]

I’m not sure this post is going to tell you anything new, but I did hear recently someone appear to misunderstand one of the the basic premises of the Marshall Model. So, for the benefit of clarity…

The Marshall Model – Recap

The Marshall Model asserts that there are four basic collective mindsets in organisations. For ease of reference, the model labels these collective mindsets, in order of increasing effectiveness: Ad-hoc, Analytic, Synergistic and Chaordic.

These various collective mindsets – and by “collective” I mean shared, more or less, by everyone within a given organisation – dictate the strategies in use in that organisation. And by “strategies in use” I mean, when making every kind of decision, from the most senior manager to the lowliest worker, the approaches used to make or inform those decisions.

Put another way, in any organisation, a multitude of decisions come up every day:

  • Which and what kind of business opportunities to pursue.
  • Who to please (and who to ignore or disappoint).
  • Which market segments to focus on.
  • How to serve those markets.
  • How to finance the business.
  • What kinds of people to hire (and fire).
  • Which trading partners to work with (and which to compete against).
  • HR policies.
  • Management policies.
  • Sales methods.
  • Engineering approaches.
  • Budgets.
  • And on and on.

How to decide? Most always, folks will approach making these decisions within the frame of their existing beliefs and assumptions. Existing beliefs and assumptions which have become the basis for their more or less automatic responses. Kahneman calls these “fast” or “system 1” responses.

And various psychological pressures conspire to ensure any one person’s beliefs and assumptions remain “congruent” with the collective assumptions and beliefs of the organisation as a whole (for example, nobody wants to be seen as an outsider).

The Effectiveness Lever

Any organisations where people work together are by, their nature, complex adaptive systems.

The Marshall Model implies that relative organisational effectiveness is a direct function of how closely the prevailing collective mindset matches the reality of organisations. If the prevailing collective mindset enables decision-makers to choose approaches and strategies well-suited to the realities of complex adaptive systems, those decisions will be more likely to be effective. If the prevailing collective mindset constrains decision-makers to approaches less well-suited to the realities of complex adaptive systems, those decisions will be more likely to be ineffective. Both as individual decisions, and in aggregate.

So, it’s not the organisations that are Ad-hoc, Analytic (a.k.a. mechanistic), Synergistic or Chaordic systems. It’s the collective thinking of the people within those organisations that conform to one of these four labels. The organisations themselves are always complex adaptive systems. And, for the clients I work with, collaborative knowledge work systems, too.

I hope this post has served to clarify. Would you be willing to let me know whether it’s achieved that aim? And for the sake of further clarity, I’m happy to address any and all questions that this post might bring to mind.

– Bob

Further Reading

Thinking, Fast and Slow ~ Daniel Kahneman

On Espoused Theory, Theory-in-Use, and “Effective Theory” ~ Mark Federman (blog post)

After Agile

AfterAgileBlue

In recent workshops and conferences I’ve been inviting people to explore the question of “After Agile, DevOps, what now?”

There’s a line of argument, and of exploration, that goes something like this:

Idealised Design

What does the Ideal software development organisation / business look like and work like? If our existing organisation / company / business was totally destroyed last night, what would we choose today in rebuilding it? What are the key concepts and principles that we would choose to focus on in creating our ideal organisation? Cf. Idealised Design, Russell L. Ackoff.

The Role of Mindset

We may find “culture” or “mindset” amongst our idealised key concepts. By which I mean organisational mindset (Cf. Rightshifting and the Marshall Model). If so, then we may want to discover means to “shift” our present organisational mindset towards our ideal model.

Organisational Psychotherapy

How to shift an organisation’s mindset? I propose Organisational Psychotherapy as a means for approaching that in a structured way. What are the issues involves in such a shift? What does therapy have to offer? What does therapy feel like? And what kinds of therapy might suit?

If you’d like to explore these ideas in your own organisation and context, via a workshop or similar, I’d be happy to oblige. Please get in touch.

– Bob

Rightshifting In A Nutshell

rnut1

Folks’ different perspectives can seem very alien to each other.

Whilst in Sweden and Finland last week, I twice had the occasion to present this short (around ten minutes) set of slides, both times in the context of “After Agile”, explaining the very basics of Rightshifting and the Marshall Model. My friend Magnus suggested I turn them into a blog post with some supporting narrative. So here it is.

After Agile, DevOps. What Now?

The Agile approach to software and product development has been around for something like fifteen years now. Its roots go back at least another fifteen years before that. In all that time, more and more folks have tried it out, and more and more of those folks have found it wanting in some degree. This presentation explains where Agile fits in the broader scope of organisation-wide effectiveness, and suggests what needs to change to move on from the Agile approach.

Effectiveness vs Efficiency

Rightshifting observes that most organisations are much less effective than they believe themselves to be, and much less effective than they could be. Let’s not confuse effectiveness with efficiency:

Effectiveness

Doing the right thing.
(creating & deploying value)

Efficiency

Doing the thing right.
(maximising the gain, minimising the cost)

Normal Distribution Assumed

In the chart below, we see a distribution of all the world’s knowledge-work organisations, with respect to their relative effectiveness (horizontal axis). Most folks assume that it’s a normal bell-curve distribution, with some few ineffective organisations (to the left), some few highly-effective organisations (to the right), and the bulk of organisations somewhere in the “average” effectiveness centre ground:

rnut2

What most folks assume

In actuality, though, the distribution is highly skewed and looks like this:

rnut3

In actuality

Here (above) we see that fully half of all organisations have a relative effectiveness of less than one (the median), while there’s a long thin tail of increasingly effective organisations stretching out to the right (hence, “Rightshifting”). The most effective (rightmost) organisations are something like 5 times (500%!) more effective than the average (median).

Aside: For those interested in evidence, ISBSG data and NPS data correlate well to this distribution.

Waste (Non-Value Add) And Productivity

Overlaying lines for waste (a.k.a. muda: non-value-adding activities) and productivity on the above chart illustrates the consequences of such ineffectiveness. Median organisations for example are wasting around 75-80% of their time, effort, money and resources on doing things that add zero value from the perspective of any stakeholder:

rnut4

Where Does Agile Fit?

So, how effective are those organisations that are using Agile (as intended)? Let’s look at where Agile fits on this chart:

rnut5

As we can see, organisations using the Agile approach span the range circa 1.2 through 2.0. And that’s for organisations in which Agile being done well. (There’s not much point talking about AINO – Agile in Name Only. That buys us nothing in the effectiveness stakes.) The exact position in this range of Agile’s effectiveness depends, in part, on how well the rest of the organisation is aligned to the Agile practices in e.g. the development, ops or DevOps groups within the organisation. Closer alignment = a more effective organisation as a whole.

From the above chart, we can see there’s a whole swathe of effectiveness (from circa 2.0 rightwards) not open to us through the application of the Agile approach. Organisations must find other approaches to access these higher levels of organisational effectiveness.

Explaining Effectiveness

So just what is it that accounts for any given organisation’s position on the Rightshifting Chart? What do the highly ineffective organisations to the left do differently from the average? What do the highly effective (Rightshifted) organisations do differently from the rest? What explains any and every organisation’s effectiveness? It’s very, very simple:

Effectiveness = f(Collective mindset)

That’s to say, any organisation’s effectiveness is a function of its collective, organisational mindset. A function of the assumptions and beliefs it holds in common about work, and how work should work. We can characterise the spectrum of organisation mindsets (a.k.a. memeplexes) into four basic categories: Adhoc, Analytic, Synergistic and Chaordic. This forms the essence of the Marshall Model.

The Adhoc Mindset

Least effective of all the mindsets is the Adhoc mindset. This is characterised by a near-complete absence of organisational structures and disciplines.

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Adhoc-minded organisations have no managers, no processes, no standards and no accepted ways of doing things. Every day is more or less a new day, a clean slate, as far as running the business is concerned. In these organisations, the value of discipline has not yet been discovered. I like to think of these organisations in terms of the typical Mom-and-Pop family business.

Some of these organisations, of course – if they, for example, find a profitable niche in which to do their business – can grow despite their ineffectiveness. And with that growth, sooner or later, comes the realisation of the need for some discipline. At this time these organisations will likely start appointing managers, splitting the business into departments (silos) and thereby begin transitioning into the next mindset.

The Analytic Mindset

More effective than the Adhoc-minded organisations, those organisations with an Analytic mindset are typified by the corporates, large and small, that we have come to know and love(?) over the past one hundred years or so.

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Central to the Analytic mindset is the belief that organisations are machines, and that just as with machines, if they are broken into parts, with each part performing well, then the whole will perform well. As Russell L. Ackoff (source for this sense of the term “analytic”) points out, this is a fallacy, although one very widely held in businesses everywhere.

Other common beliefs in the Analytic mindset include:

  • Theory X (Douglas McGregor) – people are idle and shiftless and have to be beaten with a stick in order to get any work out of them.
  • Extrinsic motivators such as perks and bonuses enhance performance (demonstrably false in knowledge-work).
  • Managers do the thinking and workers do the doing.
  • Check your humanity, emotions and passion at the door.

Eventually, a few organisations in pursuit of effectiveness may stumble – for it’s rarely intentional – out of the Analytic mindset and into the next mindset – Synergistic.

The Synergistic Mindset

The real uplift in effectiveness starts with an organisation’s transition into the Synergistic mindset. We’ve been hearing about some exemplars of this mindset for years (W.L. Gore, Semco) and others, more recently (Morning Star, Buurtzorg, et al.).

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At the heart (sic) of the Synergistic mindset is the belief that organisations are much more like communities than machines. Complex adaptive social systems rather than complicated yet predictable “mechanical” systems. The term “Synergistic” comes from R. Buckminster Fuller, and his statement that the performance of synergistic (synergetic) systems can never be predicted from an examination of their parts considered separately. This is not a comfortable concept for many of those more traditional business people.

Other common beliefs in the Synergistic mindset include:

  • Theory Y (Douglas MgGregor) – people are keen to do a good job, if only they have the opportunity.
  • Intrinsic motivation enhances performance (demonstrably true in knowledge-work).
  • The people doing the work must decide how the work works.
  • Alignment – and effectiveness – is a consequence of a shared, common (and emergent) purpose.
  • Management  – the social technology invented around one hundred years ago – is dead.
  • Bring your humanity, emotions and passion with you into work, every day.

Eventually, a few organisations in pursuit of effectiveness may stumble – for, again, it’s rarely intentional – out of the Synergistic mindset and into the fourth and most effective organisational mindset – Chaordic.

The Chaordic Mindset

Most effective of all are those very few organisations embracing the Chaordic mindset.

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Key to the Chaordic mindset is the continual, active, systematic searching for new business opportunities. The term “Chaordic” comes from Dee Hock – the originator of the Visa organisation back in the 1960’s.

The Chaordic mindset inherits from the Synergistic, with some additional common beliefs, including:

  • Dynamic market sweet spots – tracking and exploiting the ever-changing high-margin sweet spots in the market.
  • Instability – always teetering on the cusp between stability (order) and chaos (disorder).
  • Inevitable collapse – occasionally, the organisation will collapse into (temporary) chaos and disorder.

Transitions

Even more interesting than the four mindsets, though, are the three transitions (shown in orange, below). Each transition is an enormous wrench for most organisations.

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The Adhoc to Analytic transition is relatively easy, going with the flow, as it were, in that wider society and most people in work mostly believe organisations should be run along the lines suggested by the Analytic mindset. Much more challenging are the other two transitions, being very counter-intuitive for most people.

Where Does Agile Fit In Terms Of Mindsets?

So, where does Agile fit amongst these four mindsets?

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Here we can see how Agile straddles the Analytic-Synergistic transition. This explains just why sustainable Agile adoption is so difficult for most organisations. If part of the organisation makes the transition and the remaining parts do not, then Organisational Cognitive Dissonance ensues, and its eventual, inevitable resolution rarely results in the whole organisation shifting its mindset. Much more likely is either a) the now-synergistic part is dragged back, kicking and screaming, into the (old) Analytic ways of doing things or b) the (newly) synergistic folks find they cannot or will not go back, and thus quickly quit for pastures new.

From the above chart we can also see what is to come After Agile: More Synergistic thinking, more of an approach embracing the beliefs of the Synergistic mindset, and for some brave few, Chaordism.

– Bob

 

The Antimatter Model

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For me, the power of any model lies in its predictive ability – that’s to say, in its ability to help us predict what might happen when we intervene in the domains, or systems, to which it applies.

“Essentially, all models are wrong, but some are useful.”

~ George Box

For example, the Dreyfus Model helps us predict the impact and outcomes of training initiatives and interventions; the Marshall Model helps us predict the outcomes of our organisational change efforts and interventions.

The Antimatter Principle

The Antimatter Principle is a principle, not a model.

Principle: a fundamental truth or proposition that serves as the foundation for a system of belief or behaviour or for a chain of reasoning.”

The Antimatter Principle proposes a single course of action (namely, attending to folks’ needs) is sufficient as a means to create a climate – or environment – that will lead to groups, teams and entire organisations becoming more effective at collaborative knowledge work.

The Antimatter Transformation Model

Confusingly perhaps (and my apologies for that) I wrote recently about the Antimatter Transformation Model. I’m rueing my calling it a model at all now, seeing as how it seems ill-suited to be labelled as such (having no real predictive element). Let’s set that aside and get on…

The Antimatter Model

In this post I present the Antimatter Model. This model serves to improve our understanding of how the Antimatter Principle works, to help share that understanding with others, and to allow us to predict the outcomes from applying the Antimatter Principle within e.g. collaborative knowledge work organisations.

Virtuous Spirals

The Antimatter Principle basically proposes a collection of positive feedback loops, akin to Peter Senge’s “Virtuous Spiral” systems archetype.

Virtuous Spiral 1

As people attend to others’ needs, they find joy in doing so. This is a typical human response to helping others, being part of our innate nature as social animals (cf Lieberman). This feeling of joy tends to encourage these same people to invest more effort into attending to others’ needs, increasing both the frequency and reach of such activities. And by doing it more often, they are likely to become more practiced, and thus more capable (skilful).

Virtuous Spiral 2

As those other folks see their needs attended to, they will likely feel an increased sense of wellbeing. Not least because they sense people, and the “organisation” more generally, cares for them. This is compounded by a further increase in their sensation of wellbeing as they see their needs actually met. This increased sense of wellbeing also contributes to an increased sense of community, and positive feeling about their social relationships – another key driver for us human social animals.

Virtuous Spiral 3

And as these other folks feel their wellbeing and social connections improve, our strong and innate sense of fairness raises individual cognitive dissonance levels, such that some might choose to reciprocate and attend to the needs of others, in turn. In other words, folks sense they are on the receiving end of something beneficial, and find themselves wishing to see others similarly blessed. And with the Antimatter Principle, they are automatically well-placed to act on this social imperative.

Virtuous Spiral 4

Further, the same sense of dissonance may encourage people to attend more closely, perhaps for the first time, to their own needs.

And the Bottom Line

And, finally, beyond the dynamics of the Virtuous Spirals improving the climate/environment of the workplace and organisation, actually meeting folks’ needs (customers, managers, shareholders, employees, wider society) with effective products and services is what successful business is all about.

Predicted Outcomes

The Antimatter Model predicts the following beneficial outcomes

  • Folks discovering pleasure and delight in seeing others’ needs met – we often call this sensation “joy”.
  • Improved interpersonal relationships and social cohesion – we often call this “community”.
  • Improved self-knowledge and self-image.
  • Reduced distress.
  • Increased eustress.
  • A progressively more and more effective organisation, business or company.
  • Reducing levels of waste and increasing flow of value (i.e. needs being met).
  • Increasing throughput (revenues), reducing costs and improving profits (trends).

Risks

I have yet to write about the risks implicit in the Antimatter Model. These include:

  • Sentimentality
  • Indifference
  • Posturing
  • Hubris
  • Jealousy
  • Vigilantism

I will be writing about these risks – and ways to mitigate them – in a future post.

Summary

As folks start to attend to folks’ needs, social cohesion and the sense of community rises, folks find joy in attending to others’ needs – and in seeing others’ needs attended-to. Those actively and joyfully engaged want to do more, and those not (yet) actively engaged become curious and then, often, keen to participate themselves. Thus more people choose to engage, more needs get met, social relationships improve, and yet more folks may choose to participate. And so on.

And all the while, the needs of all involved – including those of the business – are getting better and better (more effectively) met, too.

– Bob

Further Reading

Social: How Our Brains Are Wired To Connect – Matthew Lieberman
The Neuroscience of Human Relationships ~ Louis Cozolino
Social Physics: How Good Ideas Spread ~ Alex Pentland

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