11.28.2022

Performance-Measurement Systems -- What are the Common Design Mistakes?

In October, Dennis Sherwood published a book entitled Strategic Thinking Illustrated: Strategy Made Visual Using Systems Thinking -- His book is about the behavior of systems. Systems are important, for we interact with them all the time, and many of the actions we take are influenced by a system – for example, the system of performance measures in an organization influences, often very strongly, how individuals within that organization behave. Systems thinking, the main subject matter of this book, is the disciplined study of systems, and causal loop diagrams are a very insightful way to represent the connectedness of the entities from which any system is composed, so taming that system’s complexity.

When I spoke with Dennis this month, I asked him: “What are the most common mistakes made when designing performance-measurement systems?” Here is his complete answer:

Let me choose just one. The BIG ONE. Unintended consequences.

A (real) example. A number of years ago, the UK government was becoming increasingly concerned about how long people had to wait in the reception area of hospital Accident and Emergency Departments until they were seen by a nurse or a doctor. To address this, they introduced a performance measure that at least 98% of those arriving must be satisfactorily treated and discharged, or transferred elsewhere within the hospital, within 4 hours.

That all sounds eminently sensible, and the intention was to act as a spur to hospitals to speed things up. 

Not long after this performance measure was introduced, a story appeared in a national newspaper with this opening paragraph:

"Hospitals were last night accused of keeping thousands of seriously ill patients in ambulance 'holding patterns' outside accident and emergency units to meet a government pledge that all patients are treated within four hours of admission."

It turns out that the "4-hour clock’" only starts running when the patient arrives at the front desk of the hospital. So if the patient is still in the ambulance, that doesn’t count… 

The "holding pattern" enables the hospital to meet its performance measure, but with two "unintended consequences." From the patient’s point of view, nothing has changed, nor has the government’s objective been met. And as a by-product, whilst the ambulance is acting as an "external waiting room," it remains stranded, and can no longer fulfill its primary purpose.

Not only did the performance measure not drive the intended outcome, it made matters worse by reducing ambulance capacity. Oh, dear.

This is by no means uncommon. Performance measures are introduced to influence behaviors so as to achieve some intended result. The problem, however, is that those behaviors take place within a complex context, and unless that complexity is well-understood, it is very easy to fall into the trap that a well-intentioned intervention has an unintentional, and perverse, effect.

How can this trap be avoided?

"Systems thinking" can really help, for systems thinking is a very powerful, and pragmatic, way to tame the complexity of real systems, so ensuring that, for example, performance measures can be introduced that really work. That designs out "unintended consequences." Indeed, in my view, that term is just a mask to disguise the fact that whoever designed the performance measures that failed just didn’t understand the corresponding system. Don’t let that happen to you!

What do you think of Dennis Sherwood's answer? Has your organization ever instituted a measure or process designed for improvement that drove incorrect or "gaming" behavior? His book is available here.

10.28.2022

Can Green Six Sigma Help and Enhance Sustainability and Climate-Change Initiatives?

This past September, Ron Basu published a book entitled The Green Six Sigma Handbook:  A Complete Guide for Lean Six Sigma Practitioners and Managers, which details how the benefits of a combined Lean and Six Sigma initiative can indeed encompass sustainability and climate-change concerns. 

I spoke with Ron this past week and asked him specifically: "How does Green Six Sigma help and enhance sustainability and climate-change initiatives?" Here is his complete response:

If nothing tangible is done climate change will worsen and its impact on our planet will be catastrophic. We have many climate change initiatives, such as clean energy and retrofitting houses. There are also many global initiatives sponsored by the United Nations, such as several COP (Conference of Parties) conferences going on for several years. We need breakthrough technology and breakthrough change methodology. We have the power of invention to assist these initiatives but that takes time. We have to use all our available tools now. Six Sigma is such a tool for breakthrough change methodology. The tools and approaches of Six Sigma when focused and adapted primarily to climate change demands get Green Six Sigma. The approach is underpinned by three tenets: fitness for the purpose of climate change, fitness for holistic Lean processes, and fitness for environmental sustainability.

The importance of climate change or global warming, if you prefer it, cannot be doubted. All land areas of our planet are experiencing heat waves, frequent storms, flooding, landslides, and wildfires. As a result, there are many international and national climate change initiatives in hand, but the outcomes are not always sustainable. We also need a catalyst and a disciplined process to make it happen. This is where Green Six Sigma comes in.

Green Six Sigma combines and extends the tools, techniques, and processes of both Lean and Six Sigma to customize them for climate change initiatives. As a specific example, the DMAIC (Define, Measure, Analyze, Improve, and Control) cycle has been extended in Green Six Sigma to DMAICS with the inclusion of Sustain. The tools and techniques of Sustain ensure and enhance both the sustainability of the outcomes of climate change initiatives and the sustainability of environmental standards. It is vital we harness all our tools and resources to regenerate the economy after the COVID-19 pandemic and Ukraine conflict and implement climate change initiatives for the survival of the planet.

A number of real-life case examples have been included in The Green Six Sigma Handbook to support how sustainability can be enhanced. This book is a hands-on single-source reference of tools, techniques, and processes integrating both Lean and Six Sigma. I show how to apply the principles of Lean Six Sigma and FIT SIGMA to the practical realities of businesses of all sectors and walk readers through the application of tools and techniques in the environmental context. The uniqueness of the Green Six Sigma approach is that its outcomes lead to the sustainability of both processes and environmental standards of climate change.

What do you think of Ron Basu's perspective? Do you think Lean Six Sigma initiatives can encompass sustainability? Has your Lean Sigma process evolved to include climate-change concerns? 

9.27.2022

What are the Biggest Mistakes Professionals Currently Make When Networking and Negotiating?

In July, Doug Gentilcore published a book entitled Getting from the Bar to the Boardroom: 25 Proven Sales Techniques for Relationship Building, Networking, Negotiating, and Dealmaking in which he shares his firsthand experiences and knowledge for developing a promising business career. He clearly explains why any business professional, whether in sales or not, will, at some point, have to persuade an individual or group to change their current course of action in favor of a new one. 

I had the chance to speak with Doug this past month, and I asked him: "What are the biggest mistakes professionals make currently make when networking and negotiating?” Here is his full answer:

There are many things that can inhibit your success when it comes to negotiating and networking.  In my experience, allowing emotion to enter into your process is the most detrimental to achieving your goals.  

Too many people use passion and emotion interchangeably, but as I say in my book, "With passion also comes respect for others and their opinions.  Emotion is usually accompanied by closed-mindedness and disrespect." Every poor decision or overreaction I have ever made in my life has been emotional.  Even if I am faced with a challenging situation, my passion allows me to remain driven, logical, and positive. It is important to understand the effects that emotion can have on your mental state, decision-making process, and ultimately, your success. 

Whether it is a client you are hoping to sign or a contact that you need to make to win a deal, there will be barriers and challenges you face to accomplish your goal.  In order to properly assess, plan and execute to conquer these impediments, you must check your emotion “at the door” so to speak.  A customer challenging you during a negotiation is not a personal attack, it is a chance to demonstrate your ability to deliver when it means the most, and your client will remember how you react. To again quote my book, “Behind passion there is reason and logic, behind emotion is ignorance."

In short, don’t be emotional and as a result, ignorant.  This is a negotiation, not a prize fight and logic will always keep you on the proper path.  To prevent an emotional outburst, you must have a solid accounting of your performance and mental state, so be sure to check in on both and even ask your colleagues and friends for their assessment.  Being too close to the situation will cloud your judgment and everyone can use another set of eyes and ears from time to time.

What do you think of Doug's perspective? Have there been times when emotions have ruined an important negotiation or affected a networking opportunity for you?

8.25.2022

What Are the Biggest Mistakes Sales Professionals Make While Trying to Reach New Customers?

At the beginning of this month, I had the chance to speak with Shawn Casemore about his recently published book entitled The Unstoppable Sales Machine: How to Connect, Convert, and Close New Customers. His book addresses the shifts sales professionals and their organizations must make for introducing modern sales strategies. It provides insights and proven strategies for business owners, sales executives, leaders, and professionals -- anyone who desires to create a rapid and sustained increase in their sales without investing significant time or money. 

During our conversation, I asked Shawn: “What are the biggest mistakes sales professionals currently make while trying to reach new customers?” Here is his complete answer:

There is only one mistake sales professionals make while trying to reach new customers or clients – they give up.

A recent Gartner Study has outlined what sales professionals have noticed for years. Buyers spend less time connecting with sales and more time researching their ideal solution.

This continuing shift results in many buyers not engaging with sales until they believe they have a need. This results in one of three possible scenarios for sales -- They must contend with buyers who:

  • Engage before they begin researching, with no intention of buying.
  • Engage while researching and never circle back to confirm their decision.
  • Do not engage as their need isn’t yet clear or urgent.

Unfortunately, experiencing any of these three scenarios can result in sales giving up on the pursuit and conversion of their prospect.

Instead, sales professionals must be more strategic about pursuing new buyers to build trust and curiosity. The first three steps to take in accomplishing this are:

  1. Too many sales professionals find a new lead and pursue them aggressively, only to taper off their efforts within the first two weeks after no response. Instead, sales should slowly build outreach, increasing your buyer’s attention and creating the perception that you have something interesting to share.
  2. Studies have repeatedly found it takes between 8 to 20 touchpoints to get buyers’ attention. As a result, outreach strategies must consist of at least 20 touchpoints if there is ever an opportunity to connect with the buyer.
  3. Many of the sales teams I work with use one primary form of communication - email. Buyers are overwhelmed with emails today, and increasingly complex spam filters are removing more unwanted emails from their inboxes. Instead, sales professionals should use various methods to reach buyers, including direct mail, telephone, video, and social media. 

The only thing to give up when pursuing buyers is old methods of prospecting that are no longer relevant.

What do you think of Shawn’s perspective? Have you or your company experienced these scenarios with potential customers? If so, have you incorporated any of Shawn’s solutions? What other solutions have you tried?

7.25.2022

The Tools of Startup Organizations -- How Do They Benefit Performers, Artists, Entertainers, and Creatives?

In June, Paula Landry published a unique book entitled Applying Entrepreneurship to the Arts: How Artists, Creatives, and Performers Can Use Startup Principles to Build Careers and Generate Income. This practical book puts successful startup tools in the hands of creators: performers, artists, entertainers, creatives, and media makers seeking to launch like a business and generate more income.

When I recently spoke with Paula, I asked her: “Why are the tools of startup organizations important to performers, artists, entertainers, and creatives?” Here is her complete answer:

The tools of startup organizations are important to performers, artists, entertainers, and creatives who often battle feelings of overwhelm and self-doubt in addition to limited resources. Like all entrepreneurs, creative people must stay lean, move quickly, and keep DOING while learning. This avoids analysis paralysis and generates results. Creative people who want to generate more income and success now have a path to entrepreneurship specifically adapted to their unique skillset.   

Entrepreneurship for artists is a process of discovery that includes: 

Planning – defining a goal.

Time to build and test – figuring out what works for you. 

The process of creating with constraints – to stay fast, focused, and frugal. 

Bravery to share with awareness – customer feedback helps you improve.  

Committing to generating results with your launch – gathering data to learn from. 

Time allocated to manage your venture and analyze results – to understand your customers and improve your offering!  

Applying Entrepreneurship to the Arts: How Artists, Creatives, and Performers Can Use Start-up Principles to Build Careers and Generate Income translates startup processes – ideation, testing, marketing, prototyping, as well as legal and financial management – shaped into a creative approach. This work is not exclusive to artistic talents; it’s inclusive, building upon the artistic skillsets. Why are there so many new, Lean tech companies that startup, launch and generate revenue quickly? The path and workflow have been clearly defined, articulated, and demonstrated. Creative ventures are similar to startups and it’s possible to utilize those tools, now adapted for the creative community.  

If you’d like to learn more about the startup concepts and frameworks in Applying Entrepreneurship to the Arts, visit StartupTools4Artists.com and buy the book today. 

What do you think of Paula's ideas? As a creative, do you think startup tools used by organizations are applicable to you and your business?

6.24.2022

Career Success -- What Are the Basic Factors?

At the beginning of May, Barry A. Franklin published a very interesting book -- entitled GPS for Success: Skills, Strategies, and Secrets of Superachievers -- which analyzes and highlights the foundational factors underlying future career success. Throughout the book, Barry provides specific examples and inspirational stories highlighting 10 critical behavioral skills for success. 

When I spoke with Barry just this past week, I asked him: “What are the basic factors that underly career success? Why do most people miss them?” Here is his complete answer:

After 10 years of undergraduate and graduate education, ultimately culminating in a Ph.D., it seemed somewhat paradoxical to me that virtually no college course had prepared me for the world of work. Accordingly, I began reading everything I could find on achieving career success and learned how ill-prepared I really was!

The critical knowledge and experiential perspectives I lacked included: understanding the power of relationships, positive associations, and collaboration; essential people skills; goal setting; the “boomerang effect” of serving others; dealing with setbacks; the virtues of patience and persistence; the potency of preparedness; writing and speaking expertise; understanding the laws of attraction and sow and reap; the dividends of organizational membership; and, the #1 success strategy -- taking action.

My research identified four foundational factors underlying overwhelming career success. These included: love what you do; realize that to a large extent, you make your own luck; take 100 percent responsibility for your setbacks and achievements in life; and admirably serve others.

Finally, why do most people miss them? Unfortunately, these underappreciated “soft skills” are seldom even touched on in college curricula that equip students with broad life and career proficiencies that empower them to contribute meaningfully to their communities and the workplace.

Perhaps the late professor Randy Pausch, author of  The Last Lecture, summed it up best when he said, “It’s not about how to achieve your dreams, it’s how to lead your life. If you lead your life the right way, the karma will take care of itself, and the dreams will come to you.” In so many ways, GPS for Success was written to fulfill this objective, to enable the dreams of others and provide guidance about how to live your life.

What do you think of Barry's perspective? Did you his recommendations for future career success accurate and inspiring? Are there any factors missing? What would you add?

5.26.2022

How Should Your Company Pursue and Achieve Innovation?

This past April, Michael Parent published a book entitled The Lean Innovation Cycle: A Multi-Disciplinary Framework for Designing Value with Lean and Human-Centered Design, which addresses what many companies are facing regarding pursuing innovation. His book addresses these concerns by introducing a new multidisciplinary framework for both thinking about and pursuing innovation. By taking key concepts from the quality management practices of Lean and Six Sigma, the framework augments these tools and disciplines by incorporating other problem-solving and design techniques, including Human-Centered Design. The result is a view of innovation that many business leaders will find fits nicely into their existing paradigm of strategy and operational discipline.

When I recently spoke with Michael, I asked him: “How should companies pursue and achieve innovation now?” Here is his complete answer:

Innovation seems to be on the tips of everyone’s tongues. Search social media and you’ll find an ethos of innovation behind every post. But the popularity of innovation and entrepreneurial thinking on social media has done damage to how businesses and industry incumbents should think about and pursue innovation. Especially in a world buffeted by global disruptions – chip shortages, inflation, supply chain issues, pandemics – just to name a few, companies need to have a greater understanding of what role innovation plays in their business and the different ways they adapt to a dynamic organizational landscape.

Regarding innovation, the biggest opportunities for businesses are to pursue an innovative approach styled after the principles of Quality Management. Organizations can mitigate their risks of disruption by holistically evaluating their existing processes, and shoring up gaps that put them in jeopardy. It might not be sexy, but improving supply chain reliability, capability, and in-process quality has enumerable benefits for most businesses, from increasing profit margin, to reducing expenses, to driving towards operational consistency across their entire value chain.

Equally important is how businesses should avoid pursuing innovation. Generally speaking, if you’re anything but a new start-up business, you should stay away from grandiose ideas of disruptive innovation and industry-altering advancements. These promise exceedingly high profits and growth but fail to materialize due to excruciatingly low chances of success, high resource demands, and even internal organizational disruption to the existing business.

A business incumbent has already been successful in their industry. Rather than abandoning the history and tradition of the firm through radical, disruptive innovation, a business ought to re-evaluate its existing value propositions through the lens of a fresh perspective. Amidst global disruptions that have mainly affected business operations (and left the products and marketing themselves untouched) the principles of quality management, Lean, and Six Sigma is an excellent framework to begin this endeavor.

What do you think of Michael’s perspective? What role does innovation play in your company? How is your company pursuing innovation? What have been the pitfalls?

4.26.2022

Why is the Failure Rate of IT and Change Management Projects So High?

 A few weeks ago, I had the chance to me with Scott R. Coplan in New York City and discuss the release of his new book, The Integrator: A Change Management Framework for Achieving Agile IT Project Success. This book defines change management as the single overarching methodology integrating Agile IT and project management. It does this because all projects are about change – significant organizational and personal change. The people involved – their participation in and understanding and support of these changes – ultimately determine IT projects success or failure. In fact, while all IT projects are about change, successful projects change human behavior.

During our conversation, I ask Scott, "Why is the failure rate of IT and change management projects so high?" Here is his complete answer:

There’s only one reason projects fail — leadership. You know who I’m talking about. Most of us have worked for that problematic project leader. 

Everything stems from a project’s leadership. They are the principal players or sponsors responsible for guiding each participant in completing the project successfully or failing miserably. 

A successful project requires a chain of sponsorship, including authorizing and reinforcing leaders. Authorizing sponsors have the power to approve, fund, and allocate resources to achieve a project supporting the organization’s clearly defined purpose. Reinforcing sponsors uphold, strengthen, and execute the project on behalf of the authorizing sponsor. 

The pervasiveness of project sponsorship problems stems from one fact. Just because an individual holds a leadership position doesn’t mean they know how to lead. They need guidance. 

In these instances, the problematic sponsor’s boss or a change agent must start by working with that struggling project leader. While having a meeting about their inadequacies is never easy, it is necessary. 

Most problematic leaders feel inhibited in a sponsorship evaluation meeting with their boss. As a change agent of 45+ years, I’ve conducted hundreds of meetings as the boss’s proxy.

This requires preparation before the meeting, including clarity about what the problematic sponsor must do, described in safe language. It’s typical for a sponsor to have little idea of what sponsorship means. I always start by taking time to listen and understand the problematic sponsor’s viewpoint, particularly about their role and what fulfills them in performing it. That sponsor’s input and my response may help them grasp the importance of their role and improve their performance. 

I’ve encountered sponsors that still don’t understand their role, requiring other options, like routinely assessing the sponsor’s performance and providing feedback. At times, I’ve recommended guidance from an effective peer in the problematic sponsor’s development process.

In severe cases, I’ve recommended replacing the sponsor. Their departure offers an opportunity for me to help the organization’s leadership find a suitable replacement. This is an individual who starts by engaging with their direct reports, establishing a shared purpose defined by enterprise-wide collaboration, followed by aligning their beliefs and abilities with that purpose. 

What do you think of Scott's perspective? Have your IT and change management projects been successful? Have there been leadership issues?

3.25.2022

The Six Fears that Impede Corporate Innovation

New business innovation isn’t working in most large corporations. This is true even though we have made great progress over the past two decades in understanding the mechanics and dynamics of radical innovation. We have got the methodologies for creating the businesses right, but our organizations still seem to snatch defeat from the jaws of victory.

Why is this? New business creation is thriving in the startup sector, often disrupting incumbents, so the problem is not a lack of opportunity. What is going on? 

I recently spoke with James Euchner, whose recently published book -- Lean Startup in Large Organizations: Overcoming Resistance to Innovation -- addresses such questions. During our conversation, I asked him about the sources of resistance and their connection to Lean Startup. Here is his complete answer:

Any new venture confronts uncertainty: uncertainty in customer demand, uncertainty in the timing of the market, uncertainty about new channels or new business models or emerging technologies. Corporations have gotten better and better at managing these types of risk. The Lean Startup movement has done much to help with this.

It is ironic, but the very methods that have led to success in creating product/market fit have interfered with venture/corporate fit. There are, in fact, six fears that Lean Startup awakens inside the corporation that impede innovation.

The first is the fear of chaos: the concern that the iterative and experimental approaches of the Lean Startup will lead to an unmanaged innovation process. An Innovation Stage-Gate helps to contain the chaos. 

The second is the fear that the innovation process will lead to disruption of ongoing operations. Every corporation has established norms that define “how we do things around here.” New business innovation naturally challenges some of these norms. This disruption needs to be acknowledged and explicitly managed for a new venture to succeed.

The third fear is the fear that the lean innovation process will lead the company into opportunities that the company just can’t exploit. Worse, the new directions may even undermine the identity of the firm. A company needs to innovate within clearly defined opportunity spaces to counter this fear.

The fourth fear is that the new business will succeed by cannibalizing the core: the new business will appear to drive revenue and profit, but only at the expense of the financials of the ongoing business. To counter this fear, companies need to explicitly model not only the economics of the business but the impact of the new company on the core business. Sometimes, cannibalization is necessary to the ultimate growth of the firm.

I believe that the fifth fear is the cause of the failure of more new ventures in corporate settings than any other. This is the fear that the investment in the new business will drain resources from the core. It causes the core business to react in ways that smother the new business. Countering this fear often requires separating the new company from the mother ship, at least during incubation. 

Finally, executives often fear making a career-limiting blunder when investing in a new venture. After all, the new venture, by definition, moves into spaces that are less well-understood by executives in the company. To counter this fear, companies need to develop ambidextrous leaders – those who can both execute and innovate. A key requirement is for the executives to spend time in the new ecosystems. 

What has your experience been with new business innovation? What are your thoughts on Jim Euchner’s suggestions for inoculating companies against these corporate antibodies? 

2.25.2022

Can Six Sigma Help Improve HR Processes?

In 2021, prolific author Daniel T. Bloom published the second edition of his book entitled Achieving HR Excellence through Six Sigma, which describes exactly what excellence in human resources (HR) means and outlines dozens of proven approaches as well as a hierarchy of the exact steps required to achieve it. It illustrates the Six Sigma methodology from the creation of a project to its successful completion. At each stage, it describes the specific tools currently available and provides examples of organizations that have used Six Sigma within HR to improve their organizations. 

When I spoke with Daniel this past month, I asked him: "How does Six Sigma actually help improve HR processes?" Here is his complete answer:

The Human Capital Management field today is faced with a dilemma. It is a dilemma that will determine whether there is a human Capital Management field going forward. 

Too many of my colleagues are stuck in a transactional field which means that they see their role as that of the organizational fireman. There to purely put out fires. However, there is another view that Six Sigma encourages and that is the role of being the organizational thinker.

Consider the reactions from two HR professionals who have seen the Six-Sigma approach and have had phenomenal results. The HR Manager of an electronics organization stated that Six Sigma made her rethink the way she viewed HR -- it empowers you to want to make immediate and sustainable improvements to your organization. Using the strategies discussed in the book, she was able to reduce the average time to fill an open position by 58 percent and the cost of hire by 81 percent. The other view is from the VP of HR for a major trade association who told us that the material in the book (and the accompanying course) inspired her to think about additional training and professional practice of these concepts. She had already put some of the key concepts behind the DMAIC method to work.

The ultimate goal of Six Sigma and its associated tools is to enable you to see and feel the problem through the use of logical thinking processes and then to create a new normal by changing the corporate culture accordingly.

What do you think of Daniel's perspective regarding Six Sigma and the HR department? Have you incorporated Six Sigma techniques in your HR departments? If so, have the results been positive?