Monitoring and Inspection Mania in Government

Inspection

Being a US citizen is getting to be more expensive every day.  The banking industry is headed towards unprecedented monitoring and inspection.  This on top of an industry so functionally designed that the number of internal handoffs are already making banks both inefficient and ineffective.

The madness is starting to catch in other areas of government.  Take the recent proposal to monitor pilots by the National Transportation and Safety Board (NTSB).  The idea was spawned by those pilots that overshot the airport a few months back.

Just like banking when someone embezzles the reaction is predictable even if the event itself is not.  Overreaction and making sure that situation never happens again by additional functional separation of work, monitoring and inspection.  The fallacy is that we can inspect and monitor our way to improvement, but all this does is add costs that the consumer will pay in either higher prices or taxes.

I have seen this thinking in my home state where Indiana FSSA with all its cynicism is going to prevent $1 million in fraud (over a 4-year period) by additional inspection and monitoring in their eligibility program.  This will cost 3 times as much (or more) where a better design of the work would reduce cost in operations and inspection.  The price of ignorance is high for those educated but operating under old theories.

And so it is with the NTSB and the pilots.  We live in a world of “gotchas” through expensive monitoring and inspection . . . we wake-up one morning with huge deficits and the US public wonders how we got to this point.  Government laden with “good intentions” but wrong thinking.

Then government management tells us “not to worry” as we can use technology, shared services and outsourcing to reduce costs.  Where the reality is these things almost always increase costs as a good work design and different management thinking would have been a better path.  Instead government management locks-in waste through poor work design and we all pay because of it.

As the size of government continues to grow and the deficits get bigger, we have to end the practice of creating more waste and sub-optimization.  We will never be able to prevent bad things from happening in every non-life-threatening situation, but we can be smart about better work designs and thinking around the management of work.  All this mania will be the United States demise in similar fashion to the Soviet Union trying to keep up in the arms race . . . except we will have done it to ourselves.

Leave me a comment. . . share your opinion!  Click on comments below.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected].  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Mass School Firings in RI: The New Witch Hunt

 

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There hasn’t been anything this bad since Deliverology was presented to the California Education System or targets were advocated in the Indiana Education System and No Child Left Behind.  What’s next fire students from school or will we lower our standards to the point that everyone can hit the target (but the US can’t compete).  Apparently, the dolts that have introduced these “improvements” slipped through the US education system with education but no knowledge.

The system is broken from top to bottom.  By system I mean everything . . . the grading system, the standardized tests, No Child Left Behind, government officals, the design, technology, everything.  The firing of the teachers, administrators and counselors as a solution should be replaced by Arne Duncan and others responsible for this decision taking the reigns and showing us how to do it better without manipulating the targets or tests.  But this is political so anything can happen.

I grew up not a fan of unions as my father (an executive) ran a union picket line and was injured in the 1970s.  But I have come to realize that the worker (or teacher in this case) is critical and that the design and management of the work is our greatest opportunity for improvement.  In this case, the teachers represent the ones with knowledge to help improve the system. 

The attempt to make people accountable has led to this mess.  I don’t mind the accountability, but put the decision-making back with the work.  This system needs knowledge from teachers and experimentation with method not witch hunts.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected].  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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First Step to Systems Thinking . . . Curiosity

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Tools, compliance, inspection, targets, standardization . . . and the list goes on.  Service organizations mired in the command and control structures first seen during the industrial revolution.  Left in the wake of this thinking are an assortment of workers and managers disillusioned by the great hope of improvement.

Yet, year after year improvement programs come and go but the wait continues.  The names of the improvement efforts have changed but the carnage left behind piles up.

As a US citizen I have witnessed the disappearance of manufacturing and government dysfunction on a colossal scale.  The mentality is always familiar . . . reduce costs to improve profits and balance budgets.  Instead we get more costs, less control and lower morale.

I’ve made a career out of studying and understanding the path W. Edwards Deming laid out.  Rejected twice in the US; once after WWII and then a shun of his ideas for redesigning management thinking in the years since his death.  Too individualistic some will say and so the undoing of an old Tayloristic way of thinking is stymied.

A different way of thinking is upon us again, with a continuation of Dr. Deming’s principles for service industry.  The thinking about the design and management of work .

It’s not for everyone, but for those in service that seek new hope I have a message . . . “The first step is curiosity.”Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected].  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Does Your Organization Hide, Seek or Encourage Failure?

What I see in service businesses is a management paradox.  A lot of businesses try to hide failures from customers and I see so few that run towards them or even encourage failure. 

The paradox occurs  when I see organizations that hide failures have customers come after them and force resolution with reputation lost and costs increasing.  The opposite effect of what they wanted to happen.  The focus on costs always increases them. 

Conversely, I find those organizations that seek out failures are on a better path than those who hide them.  We encourage an outside-in approach by measuring failure demand (demand caused by a failure to do something or do something right for a customer) at the the points of an organization where customers come to transact business.  This measure is only the beginning, but is an important one for improvement.

Looking at failure demand leads management to understand that the system (structure, work design, technology, measures, management, etc.) is more important than the function.  Measures from a customer perspective (like failure demand) tells us how well the organization is performing.  Financial and productivity measures do not.

And the best organizations seek the failures too,  but they take this a step further by encouraging failure through experimentation with method that leads to innovation.  Breakthrough performance and an improved culture result as work becomes more interesting when you can learn and grow.  There are so few of these organizations.

How does your organization handle failure?  Do you hide it, seek it or encourage it?

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected].  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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AIG: It Just Got Worse

 

American International Group, Inc.

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Here we go, ignorant has graduated to stupid.  AIG has a solution for their compensation system . . . let’s rank employees.  Are you kidding?

I just wrote about why this is a bad idea back in October for IQPC in Better Thinking: The Case Against Targets, Rewards, Incentives, Performance Appraisals and Ranking Workers.  It was W. Edwards Deming that woke me to the ills of ranking employees.  Forced distribution of employees ranking them on a scale of 1 to 4 is the dumbest idea since Jack Welch did it at GE and many other companies before him.

It is not just the fact that the “1” employees can be only 10% of the workforce, “2” employees are 20%, “3” employees are 50% and “4” employees are 20%, the problem is that cooperation just flew out the window.  Workers fighting against each other to achieve “1” status in an organization that needs to fix a broken system you need more cooperation . . . not less.

To optimize a system we really have to get this part right.  Remember The 95/5 Rule?  That 95% of the performance of any organization is attributable to the system and not the individual.  The system made up of work design, structure, measures, management, technology, etc. makes pay-for-performance the wrong thing to do.

Robert Benmosche (the CEO) is suboptimizing an obviously broken system that played an important role one of the largest financial meltdowns in history.  Ranking workers will encourage more dysfunctional behavior to achieve “1” status.   My advice to Mr. Benmossche is to fix the system, the people are fine.

Leave me a comment. . . share your opinion!  Click on comments below.

Make the new decade a profitable and rewarding one, start a new path here.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected].  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Command and Control in Software Development

Ever wonder what happens in software development companies?  I lived it for several years in the banking industry.  The result was a bitter taste for the way Fortune 500 companies are run.

Most developers and analysts are good folks trying to do the right thing, but they are trapped inside these command and control systems that lead to incredible dysfunction.  The bureaucratic and facist management I experienced was almost unbearable.  The result for those in the organization was forced compliance or dismissal.

One particularly frightening experience occurred when working with the call center.  Customers called every day with complaints about the software and this vendor had a backlog of thousands.  The fix was to set up a committee to prioritize these in long meetings.

When a team was put together to improve the process, we discovered that we were taking longer to write-up the agendas, schedules and rankings than to just fix the problem as they came in.  The classic was when one developer during  a particularly heated conversation that lasted over an hour said he could have fixed the problem in 10 minutes. However, process had to be followed and the rankings had to be voted on, prioritized and then the work could begin.

The result was waste.  We had studied failure demand as a team and knew that if we fixed the ones that banking customers most called on while acting on any new ones we could clear out hundreds of  failure demand phone calls in a few months.  But the CIO in her infinite wisdom was “sharing services” to get testing done in other areas pulling analysts designated to “help” the customer repair orders.  Stupid . . . maybe, ignorant  . . .absolutely; the rob Peter to pay Paul principle was in play.

Meanwhile failure demand continued to cause difficulty for the call center and customers demanded action.  The resulting action was to have the customers come together in groups to prioritize during a User Group meeting.  Not surprisingly, the customers couldn’t agree as each had their own agendas.  The failure demand was the best source of what to work next, not customers or prioritization teams.

I have more examples of command and control in this industry (more will be in my book).  But another dysfunction that stood out to me was the CIO demanded process be followed except by President of the division who was allowed to waive all this silliness when financial targets were at risk.  In other words, compliance was good for everyone but the president.

Imagine a project crawling toward the finish weeks behind until the customer won’t pay or a financial target is at risk then all the ridiculous bureaucratic waste is tossed aside to do the value work.  But the president is the only one that can call for sanity.  The rest of the developers and analysts had to live with checklists and project managers beating them over the head on a daily basis.

Milestones were being achieved to “show progress” but little was getting done, except lots of documentation that was of little value.  It was a shocking combination of arrogance and ignorance in a command and control setting.

Software developers and analysts share your stories!  Click on comments below.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected].  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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Undercover Boss, Larry O’Donnell and Systems Thinking

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I have been wanting to watch the show Undercover Boss on CBS, but have been too depressed from the Indianapolis Colts Super Bowl loss to watch.  I did finally get to it this morning.  I’m glad I did.

One thing we do in systems thinking is perform “check” to understand the what and why of current performance.  We always ask the CEO to get knowledge with us and with a new client starting next week this is a good reminder of why we start this way.  In this show, Larry O’Donnell President and COO of Waste Management does just this.

I was touched by the personal story of his daughter (Lindley) that suffered some brain damage from someone not following “proper procedure” (more on this later).  I encountered a similar experience when I lost my son to SIDS (at 3 months old).  These things stay with you and help shape your life.

Randy (Larry O’Donnell) went to the work and whether for show or not . . . he got knowledge of the work.  The telling statement of his introduction was that he wanted to see the effects of his “targets and cost-cutting” on the organization.  I knew then he was in for some big surprises.

Targets and the focus on costs always increase costs and focus the organization on the wrong things.  I am grateful for W. Edwards Deming pointing this out to me.  Both men understood that such foolishness (focus on targets and costs) created a management paradox.

More importantly, Mr. O’Donnell began to understand the unintended consequences associated with corporate mandates void of knowledge.  In command and control fashion, policies were payed out and as usual  the mid-level manager got squeezed at the end (even though what was happening above the mid-level manager was responsible).  The culture was set to be a command and control one and the dysfunction and waste was soon to follow.

What resulted was a series of predictable events.  Here are a few:

  • A productivity focus led to the time clock debachle where the worker was docked 2 minutes for every minute late. Again, don’t blame the mid-level manager as Kevin (no doubt) believed he was doing what was expected from corporate.
  • A productivity focus on trash routes led to monitoring (always a waste), using a can for pee breaks, and not allowing the front-line worker to interact with customers.
  • Cutbacks that led Jaclyn to have to cover multiple jobs.

The interesting thing I have found working with the likes of front-line workers similar to Sandy, Fred, Janice, Walter and Jaclyn is that most workers are extraordinary and each has their own story.  The system they work in is broken.  Put a good person in a bad system and the system will win every time.

I was somewhat bothered by the call-out of Kevin the manager.  He most likely isn’t the problem it is the system the executives put in place.  Better questions may have led to why Kevin felt he needed a time rule for workers (we call these system conditions).

Recommendations for Mr. O’Donnell moving forward:

  • Put the decision-making back with the work and this will avoid managing from the financials and productivity numbers off of reports in command and control fashion.  Cuture will improve when the work AND worker become more relevant.
  • Forget the task forces and programs and take action based on what you find when getting knowledge. This goes back to Ross Perot’s “if you see a snake . . . kill it, don’t appoint a committee on snakes.”
  • His biggest problem is the command and control thinking that will overcome all the good that he may have learned.  Bottom-line is the thinking has to change about the design and management of work.
  • Dump the production numbers and targets in favor of customer measures derived from customer purpose.  These customer measures will lead to better productivity and greater profit.
  • Look for other system conditions that are preventing the organization from peak performance.
  • Understand that efficient is not the same as effective.

I don’t know about the circumstances surrounding Lindley and “proper procedure.”  But speaking to our tragedy, our babysitter understood that not allowing our son to sleep on his stomach was something we talked about and we could deem it not following “proper procedure.”  Mistakes happen, but I believe they happen for a reason and forgiveness becomes the really important part.

Leave me a comment. . . share your opinion!  Click on comments below.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected].  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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5S in Hospitals and Service

Groucho Marx, circa 1931
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I made the mistake of going to the LEI website today.  They have chosen not to post some of my comments, but I saw a conversation in the Lean Forum about 5S in hospitals.  I had to read on.

The participants were all looking for case studies and pictures of using 5S in a hospital setting.  I couldn’t believe the amount of copying being promoted. “Send me pictures of what you did.”

All these approaches are inside-out and not outside-in.  There is no discussion of customer demand, purpose or measures.  Is this a really effective approach?

Will improvement result from these activities?  Possibly, but the tool-laden approach without the insightful study of demand means we have little chance of finding a more purposeful design. What if demand changes (which happens  in service environments), will hospitals be able to absorb the variety of demands?

More importantly, I can predict that everyone will be forced to comply.  The compliance police will be right around the corner to make sure that you do.  After all, these are the folks that love tools, rules and order especially while wielding misguided authority.

So, when hospitals begin copying 5S activities from one to another, do they have the same demands?  Did anybody ask? No, because the functional thinking that we didn’t change before embarking on 5S allows people to make assumptions that one function is like another.

The reality is that you can 5S until the cows come home and still have lots of waste.  Maybe better with 5S that I dance with the cows until you come home (thank you, Groucho Marx).

5S had a purpose in manufacturing and a different problem to solve.  The codification of 5S for hospitals or any other service is erroneous until we ask the three questions:

  • Who invented the tool?
  • What problem were they trying to solve?
  • Do I have that problem?

And please stop the incessant copying and work on the thinking first.  A good place to start is understanding the type and variety of demand before tools.  When you start this way, you may discover that you never really needed the tools.  Better yet, you may discover a new tool that solves your problem even better . . . innovation is OK.

Leave me a comment. . . share your opinion!  Click on comments below.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected]  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Indianapolis Colts, Targets and Incentives

Dwight Freeney(en), of the Indianapolis Colts ...
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This is pure speculation and I have no proof, but I wonder about the whole Colts pursuit of a perfect season.  Let’s start back when the Colts were 14-0 and were up against the Jets.  The players were pulled to save them from injury . . . or were there more diabolical reasons like targets.

Certainly professional football is not about the fans or the Colts would have played there starters the whole game against the Jets.  I believe there were contract incentives in the coaches and GM contract to win the division, conference and Super Bowl.  But I don’t believe their contracts gave them anything for a perfect season.  In my theory, this led them to pull the starters as they had nothing to gain (perfection had no incentive).

Does this mean that we need to have incentives to do what is right for the fans?  I don’t believe so, it is just to take away the other incentives associated with targets.  No incentives, and we are left with doing the right thing.

What evidence to support my thoughts.  In the last game of the season, the starters played for Manning to get his consecutive start streak intact and a few passes to Reggie Wayne and Dallas Clark to reach 100 catches.  I don’t know about the Manning streak, but the other two sound like contract milestones.

More perplexing to me, was if injury was the real reason to “save” players than why was Dwight Freeney playing in clean-up duty the last few minutes of  the Jets playoff game?  This led to his injury before the Super Bowl.

I don’t know if my readers follow sports or not, but the foolishness of targets and incentives certainly can (or could) play out in a lot of ways in business or sports.  The customers in this case were the fans and they have an unwritten contract to see a team try to win.  Businesses and sports franchises need to realize that unintended consequences can occur when the focus is not on the customer (or fan in this case).

The solution isn’t that we need more incentives and targets, but we need none.  This would assure that the focus is on the customer and not the target with incentive.

Leave me a comment. . . share your opinion!  Click on comments below.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected]  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Quotas for Innovation?

Listening to more senseless drivel on CNBC, we need more innovation in the US.  The investment community’s answer . . . quotas for innovation.  Here we go, quotas, rewards, incentives to get innovation.

How about the design and management of work as a huge opportunity for innovation.  Redesign these pieces and we might even get competitive.

Think of it we don’t need a CIO (Chief Innovation Officer) or quotas or other dysfunctional lame-brain ideas like this.  We need to engage the minds of those on the front-line and use the other 90% of the organization that are deemed not educated enough to innovate by command and control managers.  A missed opportunity.

Then, we have all these poor work designs that do everything possible to “dumb down” the worker with technology, front/back office, scripts, standardization and the list goes on.  How about a change of pace?  Engaging the brains of these folks.

I hear it all the time, they aren’t interested in “that” they just want to do their work.  This thinking is pitiful, I have never found a worker not interested in their work . . . beaten down, yes . . . but all are interested.  Many workers think management couldn’t be any dumber, just managers aren’t in earshot of these comments.

Making all employees and their jobs relevant takes guts, but the rewards are innovation and unrivaled culture.  People love their job when given decision-making responsibility and not just accountability.  Workers deserve a better work design and managers would benefit greatly from this thinking.

The barrier is scores of years of productivity and financial brain-washing that has pushed us to having quotas for innovation.  After all, why not?  They exist for everything else.

Electric shock treatment withstanding, there is a need to rediscover the individual worker through better management thinking and better work design.  Innovation through quotas is more of the same wrong thinking.  When will it all end?

Leave me a comment. . . share your opinion!  Click on comments below.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected]  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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