Archive for February, 2010

Thank You, Dean Martin!

Cropped screenshot of Dean Martin from the tra...
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Alright, I don’t subscribe to HBR.  I will now.  I plucked down the $16.95 from the stand at the airport to read one article “The Age of Customer Capitalism.”  A must read . . . absolutely.  Pay the lady!

Like you (or not) . . . I learned in my MBA program to maximize shareholder value (or wealth).  Well Dean Martin (kind of funny name actually he is the Dean of the Rotman School of Management; his real name Roger Martin)  dispels the myth of  shareholder value in favor of “customer-driven capitalism.”  Dean Martin smartly points out that you can not optimize customer satisfaction and shareholder value . . . they conflict.

This has been a guiding principle John Seddon’s brand of systems thinking for years.  Simply put, designing systems against customer demand and deriving customer measures from purpose will allow the financials to take care of themselves.  So quite worrying about costs and get the focus on the causes of costs . . . and not serving the customer in accordance to demands increase costs A LOT!

Dean Martin calls out Jack Welch and his style of management as short-term.  In essence, he left the cupboard empty, but he walked away with millions and if shareholders timed the market appropriately they won too.  If investors bet long term, they lost.  GE Capital was met with massive write-offs in recent history(and accounted for half of GE earnings during the Jack Welch era).

Some smart organizations are beginning to learn like Research in Motion and P&G, but the rest of the companies need method to make this transformation.  So, I will continue to harp on the greatest opportunity for improvement is the design and management of work.  Changing our command and control mindset can be very rewarding, but it requires an intervention of our normal thinking patterns about how we manage our organizations.

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.

Deliverology Rears Its Ugly Head in the United States

Just when you thought a bad idea was defeated (or at least shown to be buffoonery) in one country . . . it shows up in another.  Call the religious leaders together, the exorcism didn’t work.  Deliverology has shown up in my country.

The country that once showed innovation leadership to all others has fallen to new depths by copying a failure in the UK as introduced by Sir Michael Barber (a Tony Blair flunky).  My Vanguard partners (UK-based public and private sector consultants) have made many strides in the UK righting this wrong.  They have found less improvement with Deliverology and more coercion by forced compliance to arbitrary targets set by the “steering, not rowing” crowd.

In his book Systems Thinking in the Public Sector, John Seddon illustrates many of the thinking problems of the Deliverology approach presented by Sir Michael.  Chief among them are:

  1. People want better services without paying more.  But Barber believes that the only way to achieve better services is through more resources.  This thinking around productivity as the challenge is misguided and wrong .  It was W. Edwards Deming that found the better way is to improve quality if you want better productivity.
  2. Barber advocates a command and control approach in moving services from awful to adequate.  His approach is to have targets set to force compliance to them.  Problem being is all targets are arbitrary and worse they become the defacto purpose of the organization.  In the No Child Left Behind program every ones focus has been to score high on tests and so naturally the teachers purpose is to teach to the test.  When the real purpose should be to learn.
  3. Barber believes that creating a bureaucracy for reporting and measurement is the same as real improvement.  We never find this to be the case.  Further, we never find that coercion is a good method for improvement.

The bottom-line is that Deliverology didn’t deliver in the UK and it appears that a bad idea is being exported from the United Kingdom and importehttps://www.newsystemsthinking.com/files/blog_subdomain/2010/02/page/d by the us.  if we are to get better in the public and private sector in the us, we need to “just say no” to bad ideas.  Let’s start by doing an exorcism on this one.

As I was preparing to write this post I found an article written by Dennis Loo called The Battle Over Higher Education in California it is a good read.  For those that would like to learn more on John Seddon’s analysis on Deliverology you can email me at [email protected] and I will email you back a 9-page document Deliverology: the science of delivery or dogmatic delusion?.  For those wanting to learn about a better method go to www.newsystemsthinking.com and get the free download “Understanding Your Organization as a System.”

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