Change is difficult in most organizations. It is easiest to just keep doing what has been done. Once something has reached a point where the need for change has been acknowledged how the organization proceeds is important.
The first part of the process isn’t in the scope for this post; but most often the process should start by using the PDSA cycle to understand the current situation, decide what to try, test improvements and iterate over those improvements until an improvement has been deemed worthy of being deployed widely.
The PDSA cycle process automatically includes studying the results of a possible change as part of the process. And it includes collecting evidence on the results of deploying an improvement widely and studying those results. That evidence will most importantly show if the expected results are achieved (it is far more common for changes to fail when put into action than most people acknowledge). If the expected results are not achieved learn why not, what happened?
Even though the plan is to create an improvement that can be deployed more broadly it is very possible for that to fail for some reason. A common reasons for failing is failing to understand the necessary conditions for success. Yes, the PDSA test worked, but maybe you didn’t realize that result was really dependent on the special knowledge and skill of a critical person involved in the PDSA process, or the location where the test was run was different enough from alternative sites that the improvement wasn’t robust enough to be deployed more broadly.
There are many reasons the change may need to be iterated over to adapt it to different conditions. The important factor, that is far too often overlooked, is to collect evidence on the result of the change as it is deployed and to study that evidence to determine if the improvement is able to be deployed more broadly without modification. It may be that you learn more PDSA is needed as part of the process to deploy it more broadly.
Like many people, my introduction to W. Edwards Deming was the NBC Special (termed a “Whitepaper”), “If Japan Can, Why Can’t We?” His questions within resonated with me immediately, as I was a new supervisor for Bell Telephone. “What can we do to work smarter, not harder?” rang out at the beginning of the program, and I was hooked. The early emphasis on productivity in the program was a familiar theme at my work and the telecommunications business. It was technologically advancing at a very rapid rate that was in evidence every day. It also became clear that these productivity problems were everywhere in our American economy, they were complex and crossed the economic boundaries of industry, education and government.
The evidence built throughout the program excited me when the crisis for our economy and our country became clearer, the systemic flaws in my own thinking caused me to ask myself what I could do. The pitting of management versus worker was demonstrated to be corrupt and I was challenged to look for causes and effects on a systemic scale in my own work. It was also transformational to my thinking about the power of trust in self-managed work teams and breaking down the barriers with cooperation between people engaged in common purpose.
As I learned in the Whitepaper, the featured expert who taught the Japanese and a growing collection of American companies was W. Edwards Deming. The last 15 minutes of the program focused my attention on the philosophy that would guide my learning and the improvements in hundreds or areas of my professional life. He described a philosophy that would help me work smarter, not harder. I had to learn more.
While I never met Dr. Deming, nor did I work in an industry where he met many thousands in his Four-Day Seminars, my journey so far has transformed me by using his philosophy, principles and methods. This personal and professional transformation started in 1980 with the NBC Special, and my exposure to him has been through studying and applying his 14 Points for Management, and learning about the Deming Philosophy through the numerous Deming Institute programs and conferences. Meeting other Deming colleagues and learners, as well as his family members, has helped me get to know his philosophy, too.
When asked how I started to apply the Deming Philosophy, I offer that I began by questioning my thinking and the notions prevalent within my organization. This led first to questions about the importance of understanding what the customer needs and how we could collaborate across boundaries of departmental silos and across the boundary of management and worker. I discovered the power of not knowing and getting the evidence of improvement by asking questions and testing theories of improvement with people, instead of testing these theories “on” people. This led to ask people on our team what I could do to help them improve our processes and system. I made mistakes along the way, to be sure, and I learned to adapt the management processes I had previously used to align with Dr. Deming’s 14 Points and management philosophy and methods, primarily by respecting people, from suppliers to the customers and all of my co-workers in between.
Ever inspired by Dr. Deming, during encounters with customers and partners in learning and improvement, I ask questions that he frequently asked, such as “what business are we in?”, “what is our aim?” and “how could they know?” Borrowing a favorite statement from him, “I make no apologies for learning” by consistently monitoring the effects of my system, and the statistical evidence from customers and their systems. I continue to use Plan-Do-Study-Act cycles for learning and improvement, and control charts. In fact, I still update a set of three control charts to measure team perceptions about non-priority work for the last 27 years.
I also have to balance the growing knowledge I have with the humility that the boundary of what I do not yet know grows, too! Learning is essential for our survival as a society. As I merge my purpose with the broader purpose of my customers and suppliers, the complex interaction of stakeholders in the system means I must continue to apply the Deming Philosophy and continue to transform myself while working with others to transform “our” system.
“A product or service possesses quality if it helps someone and enjoys a sustainable market.”
W. Edwards Deming
“Quality is defined by doing it right the first time.”
“There is not a day I don’t think about what Dr. Deming meant to us. Deming is the core of our management.”
As a consumer, my introduction to the quality of the Toyota’s management system began in 1989 with the purchase of a Toyota pickup truck. With 29 years of hindsight, I now realize I was enticed by Toyota’s selective focus on what I refer to as Contextual Excellence more so than the exclusive Compliance Excellence of many of its competitors.
After several years of driving the Toyota pick-up, I began to realize the higher reliability of the truck’s components, from the electrical system to the air conditioning system to the engine coolant system, none of which ever needed replacement when the truck was sold after 14 years of ownership. I wish I could say the same for the purchase of a Toyota mini-van in 1998, for which the automatic transmission suddenly failed after six months of ownership, with less than 10,000 miles of accumulated use, on, of all times, Christmas morning. Worse yet, 80 miles away from home, stranded on a motorway, and in need of a tow truck. Call it a AAA moment. Much to my chagrin, when buying the mini-van, I declined the extended service option after reading a little-known account of the “snap fit” assembly of a Toyota that reinforced my admiration for their management system. A few years later, I met an engineer from Toyota’s Georgetown facility, where our mini-van was produced. When I shared that my family was the owner of mini-van from this factory, the engineer asked how we liked it. Upon offering our sad tale of a highly premature transmission breakdown, his reaction quickly revealed his awareness of this failure mode. Asked for an explanation, he replied, “we tried to save a few pennies on a bearing.” My response, “you did, but you cost your customers far more than you saved.”
Returning to the concept of snap-fit, this is a reference to something I first read about in an account of the remarkable turnaround of Xerox between 1982 and 1990, one shared by CEO David Kearns in his 1992 book, Prophets in the Dark. According to Kearns, one of his senior staff members, Frank Pipp, had once served as the assembly plant manager for the Ford Motor Company, a decade or more before Dr. Deming was invited to a first meeting with CEO Donald Petersen.
In a timeframe in which mating parts in this car plant could not be assembled without hammers, Pipp directed his staff to purchase competitors cars and take them apart. His plan was to have the final assembly team disassemble these cars and learn first-hand how well they assembled. At that time frame within his plant, if two connecting parts could be assembled without the use of a handy rubber mallet, these parts were known as “snap fit.” The remaining parts required mallets to assemble. To Pipp’s amazement, one car purchased was 100% “snap fit.” Shocked by the results, he instructed the team to repeat the assembly operation. They did and found again that the Toyota product was 100% snap fit. The era of this story was the late 1960s and the discovery was not lost on Pipp. In contrast, he noted that the “Dearborn people,” from Ford’s corporate offices, were invited to look over the truck themselves and witness the assembly team’s discovery. According to Pipp, everyone was very quiet, until the division general manager cleared his throat and remarked, “The customer will never notice.” And then everyone excitedly nodded assent and exclaimed, “Yeah, yeah, that’s right” and they all trotted off happy as clams.”
In this blog, I would like to present a simple contrast between Compliance Excellence and Contextual Excellence and offer readers insights on the significance of this distinction. In simple terms, Compliance Excellence is revealed by posing questions about the completion of tasks. For example, were the trash cans placed at the curb last night? Did you clean your room? Did you complete your homework? In each case, the inquiry about completion of a given task has only two answers, yes or no. The task is either complete or incomplete, pass or fail. With no regard for a greater system, a part, task, module, activity, or component, viewed in isolation, receives the quality stamp of “good” or “bad.” There are no shades of gray when it comes to Compliance Excellence. In terms of how Phillip Crosby defined quality, “right the first time” implies a completed part or task is right, not wrong; good, not bad. Pass or fail.
Compliance Excellence is also revealed through questions that involve counting. By way of illustration, one might be asked about the distance to the nearest beach, airport, church, or hardware store. Whatever the answer, 10, 30.5, or 50, measured in units of time (whole or using fractions), as is often the case in Los Angeles, or in units of length, such as kilometers, Compliance Excellence infers that each unit of measure is identical to the other units; all miles are the same, all red beads are red, all white beads are white, all seconds are identical and, therefore, absolutely interchangeable, without variation. Compliance Excellence discloses detached answers; yes or no; as well as answers which relate to full units, 13, or a reference to a fractional unit, 11.5. No matter the answer, differences (variation) in elevation along the route, kilometer to kilometer, are ignored, as readily as the differences between Valencia oranges while counting them to fill an order for a dozen. The fundamental assumption is that all units are exactly the same, in every way. Contextual Excellence provides awareness of the variation in how a task is completed, as well as awareness of the differences between items or units being counted. Contextual Excellence reveals the infinite number of ways a task can be completed or the infinite number of ways a requirement can be met. In doing so, Contextual Excellence divulges shades of gray. Upon integration of tasks or components, these carefully accumulated differences appear in use, when their integration is actively managed. The impact of this ability to “manage with a systems view” is revealed by components that perform better together, as I experienced with our Toyota pick-up truck.
Another simple illustration of the difference between these modes of excellence is revealed by replies to the statement, “List 5 things that are needed to wash a table,“ in borrowing a classic example from Dr. Deming. The most frequent answers include water, a cleaning solution, a bucket, a sponge, a person, and, perhaps, someone to clean the table. More often than not, the replies do not include needing to know how the table will be used, once cleaned. Guided by such awareness of situations in which context matters, Contextual Excellence is about aligning the varying degree of cleanliness of the table with its intended use, shifting from the table is clean (or not) to how clean it should be. Contextual Excellence mirrors Dr. Deming’s definition of the quality or a product or service, mindful of how well it helps someone, how well a given task fits into a greater system. That is, awareness of the context of how well a product or service performs. Compliance Excellence mirrors Phillip Crosby’s definition of quality, with a focus of being right or wrong, pass or fail, good or bad.
In studying Dr. Deming’s management philosophy, guided by a lens of appreciation of his System of Profound Knowledge, one could be ever mindful of the contrast between Compliance Excellence and Contextual Excellence. While Compliance Excellence offers advantages when the independence of counting things, from miles to hours to apples to red beads, is essential, Contextual Excellence provides utility in the ultimate use of interdependent parts, components, and tasks. From building rocket engines to operating a city government, what opportunities for “snap fit” integration could be revealed by shifting one’s excellence focus from Compliance Excellence to Contextual Excellence, all the while relying on Compliance Excellence where it serves a most useful purpose?
David discusses how they use data to understand what is working and what needs improvement with an understanding of variation. One of the tricky aspects of using data is how easy it is to be misled and jump to conclusions that are not justified. It is easy, when an understanding of variation is missing, to see the natural variation in data and jump to beliefs about success or failure when that is not a justified conclusion based on the data.
That challenge doesn’t mean that we should avoid using data. But it does mean that while data is important it is critical is to know what conclusions can and cannot be justified with the available data. It is critical to examine data with an understanding of variation.
99% of behavior is coming from the system itself. So until you are analyzing what are we doing in the system that is causing kids to have bad behavior you are never going to get anywhere.
This idea ties together psychology (neuroscience) and systems thinking to help Ingenium school to seek systemic fixes that create systems that allow students to regain the joy and meaning in learning that so many schools do not support today. Instead of trying to force compliance from kids they seek to understand the underlying conditions that lead to behavior that is not effective and change the system to allow kids to do what they naturally do: learn.
In February 1990, W. Edwards Deming traveled to Western Connecticut State University (WCSU) in Danbury, CT to deliver three lectures, an afternoon session with students, immediately followed by one with faculty and staff of the business school, followed by an evening lecture to the general public. Dr. Deming, a self-described “Consultant in Statistical Studies” approaching ninety years of age, was invited to WCSU a year earlier, yet lacked an opening in his demanding travel schedule for an appearance at the university until a year later. Throughout the day, I joined several hundred attendees for an introduction to his “System of Profound Knowledge,” the name he chose for his theory of management, yet deferred to each audience with a kind request, “if you have a better name, please help me.”
During the Q&A period of the evening session, one attendee was seeking insight on the issue of staff cutting. His question went something like this, “Dr. Deming, what do you think about the recent trend towards reducing the number of levels of management?” Before presenting Dr. Deming’s answer, consider the options. Then again, pause and reconsider the question. Although I was not a middle-level manager, I was captivated by the prospects of Dr. Deming’s answer, for it would offer another piece to the puzzle of a better understanding his theory of management. With little hesitation, Dr. Deming answered, “Why have more levels than you need?”
As for me, it was not the answer I had anticipated, nor the direction I had expected Dr. Deming to move. For some reason, I was expecting a response with advice on how many levels of management were appropriate. Perhaps 5. Perhaps 3. Instead, Dr. Deming, in his classic Socratic style, re-framed the issue with a question revealing a contextual appreciation of organizational interactions. In time, I could recognize that this was a standard reply from Dr. Deming, to answer a probing question with a probing question, always inviting inquirers to think.
My interpretation of Dr. Deming’s answer was that the number of levels of management would be dependent on the specifics of the organization, not “one size fits all.” Given a specific situation or system (which includes one’s level of thinking), one would need an appropriate number of levels. More than this would be costly. Less than this would be costly. Trial-and-error often leads to an answer. Should the situation change, I might expect the solution to change as well. Instead of a “one size fits all” solution, this activity could be defined as “managing the system,” with its inherent interdependencies.
Why Deming / Why Now – Thinking About Systems
Now, 28 years later and 25 years after his passing in 1993, consider what questions one might ask Dr. Deming, were he alive today. Perhaps a series of questions, such as;
“Dr. Deming, what do you think about the recent trend towards reducing the waste in our operations?”, or
“Dr. Deming, what do you think about the recent trend towards reducing variation in our
“Dr. Deming, what do you think about the recent trend towards reducing costs in our
“Dr. Deming, what do you think about the recent trend towards standardizing our operations?”
I would anticipate Dr. Deming approaching each of these questions with an understanding of the nature of organizational dynamics. In each case, he would suggest the need for understanding the nature of the systemic behaviors. He would suggest the value of having no more than necessary and not less. As with the prescient title of his 1993 book, The New Economics, his proposal offers a new economics, one in which the focus is on the relationships (interdependencies) between the elements of the system and not the elements taken separately (independently).
As a real-life example, one widely applicable in organizations today, Dr. Deming’s presentations at WCSU included a classic story of how an employee’s travel costs were saved by an organization’s travel department by requiring same day travel. But, the need for the employee to awake at 3am to prepare for a 6am flight from Chicago to New York left her too tired to make productive use of her afternoon meeting. Instead of reducing cost, waste, or even variation, everywhere, a more systemic approach would be to manage cost, waste, and variation and provide the appropriate levels throughout the system. He would also remind us that what appears to be waste (hotel expenses) to one observer may not appear as such to another (the traveler). As with a whale or an organization, what might appear to be fat or waste to one observer, could be an essential economic ingredient to the long-term survival of the system.
Likewise, instead of a massive effort to standardize processes within an organization, one might ask which processes should be standardized and which should be non-standard. For example, should language and software be standardized across an organization, including its supplier base, as well as sub-tier suppliers? Is there a place for left-handers? A hospital, for example, could have uniforms for nurses that differ from those for doctors and staff members, thereby making it easier for patients and their families to identify the help they need. While there’s a place for standardization, there is also a systemic limit to what is economically viable when managing the elements of a system.
Why Deming / Why Now – the Deming System of Profound Knowledge®
In appreciation of the management wisdom revealed in The New Economics, the degree to which the system “works together” can be greatly enhanced with a better understanding of Dr. Deming’s management theory, his so-called “System of Profound Knowledge.” The elements of this system consist of the four parts below, and their interrelationships;
Appreciation for a system
Knowledge about variation
Theory of knowledge
In combining these deep bodies of knowledge, Deming’s management philosophy offers a remarkably holistic appreciation of organizations that anticipates the role of systems thinking, linked to variation management, linked to a theory of knowledge (for learning together), further linked to an understanding of people (psychology). While organizations are often content to manage a growing list of symptoms of a lack of appreciation of systems, variation, knowledge, and psychology, extending from low morale to poor quality to frequent cost overruns, to customer and supplier complaints, adoption of the Deming Philosophy enables leaders at all levels to manage with a systems viewpoint, ever conscious of the difference between treating symptoms and managing systems of interdependent elements and activities.
Why Deming / Why Now – A New Economic Age
We are in a new economic age. We can no longer live with commonly accepted levels of delays, mistakes, defective materials and defective workmanship. W. Edwards Deming
Since being introduced to Dr. Deming and his System of Profound Knowledge, I’ve grown to appreciate blind spots which face today’s “Organizations as Usual” environments, with “commonly accepted levels of delays, mistakes, defective materials and defective workmanship” as a symptom of how organizations continue to manage their resources, including time, money, equipment, and people.
One way to test for what is commonly accepted in terms of the level of big problems, including delays, mistakes, and defective workmanship in any organization is to investigate the focus of attention for problems with a question such as, “How much time is spent every day in our organization, discussing parts, tasks, suppliers, customers, activities, and program milestones which are going well?” In probing with this question, through presentations, seminars, and workshops for 20+ years, we have learned that few resources are routinely dedicated to Things Going Well. Rather, they focus on an alternate “TGW,” namely Things Gone Wrong. On occasion, we have made the observation that “continual improvement, with a focus on improving what is good, must not be a priority in your organization,” unless such an effort is dedicated to fixing problems faster, rather than preventing them from occurring.
While introduced in the 1980s as a better way to manage product, process, and service quality, the Deming Philosophy is gaining momentum in the 21st century as a better way to manage systems, with applicability to any organization interested in the endless pursuit of “doing more with less.” What’s missing from the “Organizations as Usual” focus on Things Gone Wrong is the actual variation in Things Going Well, with the ability to monitor this variation as a means to prevent the eventual repeat occurrences of Things Gone Wrong. What’s also missing from “Organizations as Usual” is the ability to wonder where a “stitch in time can save nine, if not five” or ask “where is an ounce of prevention worth a pound of cure?” While these timeless proverbs, with many alterations, are the essence of what it means to manage resources as a system, we credit Dr. Deming with documenting the invisible obstacles which block these profitable pursuits.
Now, more than ever, organizations possess limitless opportunities to improve how they manage resources within a system, with a focus on exploiting interdependency, not unknowingly falling victim to managing tasks, leading to lower travel costs, in isolation. Such a dramatic change requires a transformation in how organizations both understand and manage systems, variation, people (psychology), and knowledge, the four interdependent elements of the Deming System of Profound Knowledge®.
Guest blog by Bob Browne, author of Sys-Tao – Western Logic and Eastern Flow and former Chairman and CEO of the Great Plains Coca-Cola Bottling Company
The question, “If Japan can, why can’t we?” conjures up the works of W. Edwards Deming. It also begs another question, “If the Japanese so easily understood what Deming was saying, why is it still so difficult for people in western societies to understand?”
The answers to these questions may be that culturally the Japanese are better equipped to understand what Deming meant by his words, “Understanding Psychology.”
In today’s world “Understanding Relationship’s” might be an easier way for us westerners to understand what Deming was trying to tell us. Deming was ahead of his time. The word “Relationships” better explains what the Japanese culture understood so naturally, and what our own modern physicists and neuroscientists are only beginning to understand today.
What follows is taken from a couple pages of my book, Sys-Tao – Western Logic and Eastern Flow. It only begins to explain the importance of relationships. “Understanding Relationships” among people is every bit as important and as hard to master as is “Understanding Variations” among stuff…which is another one of Deming’s basic tenants.
“People don’t care how much you know, until they know how much you care” John C. Maxwell
Deming’s tenet of understanding psychology (or, in my words, understanding relationships) is a prerequisite to transforming traditional (western) leadership philosophies.
A more personal spin on Maxwell’s quote sounds something more like a clever quip that Yogi Berra might have made: If you don’t think about people, how are you going to get them to think about you?
This is not fluff. It is heavy stuff. It is what quantum physicists and neuroscientists are just beginning to sort out and understand. It is a very different paradigm. It’s about the relationships that make up our world more so than the stuff that is in our world.
Newton’s classical physics is all about stuff. Matter is what matters most. It deals with inanimate objects that can be easily measured with our five senses. It is a left-brained reductionist view of the world in which everything can be reduced to its most basic elements, analyzed and reassembled into a mechanistic model that theoretically can predict the outcome of any transaction. It permeates our western culture.
Quantum physics, on the other hand, is all about relationships. It deals less with causal relations, and much more with co-relations of things we cannot perceive with our five senses —things like force fields instead of stuff, waves instead of particles, and energy instead of matter.
They are both good theories, but to understand one you must in some way let go of the other. Unfortunately, in the case of quantum physics there is very little for us to grab on to.
Quantum physics has been around for over 100 years, but just like the teachings of Deming, it is difficult to comprehend because we have so few “just-like” references (metaphors) to visualize what it is telling us. For the most of us, Newton makes perfect sense, and this quantum physics “stuff” sounds like gibberish.
Likewise, modern neuroscience has now determined that even our brains are better explained using this quantum approach.
Let’s save the science for the next chapter. First, let’s just focus on the main point: Relationships are more important than stuff.
John Wooden, the famous basketball coach at UCLA. won ten national championships, yet his coaching advice more often emphasized relationships over winning. For instance, he told his players to always thank the teammate who passed the ball after you made a basket. One player asked him this was possible during a game. Wooden responded, “Just give him a nod or throw him a finger.” The player said, “What if he’s not looking?” Wooden said, “He will be.”
Coach Wooden understood the importance of relationships and his leadership philosophies were a constant reminder. To learn more about Wooden’s leadership philosophies, go to Sys-Tao/links. You will see that he was always telling us: It is the way we play, and not the score, that matters.
“If you don’t go to your friends’ funeral, they won’t come to yours.” Yogi Berra
In this ambitious and wide-ranging book (Sys-Tao), Bob Browne tells the story of the Great Plains Coca-Cola Bottling Company, and of his career-long journey to find a better way—more efficient, more caring, more capable—for the people and the processes under his leadership. Along the way, he explains the principles necessary in order to establish a more lifelike “Process Control Environment”—something very different from the more traditional “Command and Control” structures that are so familiar in western business—and he points to illuminating connections and convergences found everywhere in the world around us, from eastern spirituality, to biological evolution, to modern neuroscience.
On April Fools Day 1980, Bob Browne and his partners invested $7.5 million in a Leveraged Buy Out (LBO) to buy an Oklahoma based Coca-Cola bottling company. When they sold the company in 2011, they had recouped over $400 million in after-tax dollars!
Ask Bob if this was his crowning achievement, and he will quickly say, “No”.
On April Fools Day 2010, Bob stepped down as President of what had become his life’s work. Privately, he began plans to sell the business and write a book in order to answer this question.
The book, Sys-Tao – Western Logic & Eastern Flow, is about the journey…not the results. The answer to this question is about a transformation…a transformation that Bob believes would make W. Edwards Deming very proud.
2010 ASA Deming Lecture – “Dr. Deming Consults on Quality for Sir William Osler” by Brent James, Institute for Health Care Delivery Research. Brent James has worked at Intermountain Healthcare for several decades. I wrote a previous post on this blog about a paper he wrote about using Deming’s ideas at Intermountain Healthcare.
The beginning of the talk provides an overview of the huge macroeconomic risks of the health care system in the USA. As those familiar with Deming’s ideas know, Dr. Deming added excessive health care costs to his 7 deadly diseases of Western management. The last 2 deadly diseases he added specifically about problems in the USA: excessive health care costs and excessive legal damage awards swelled by lawyers working on contingency fees.
Next, Brent James looks at the long term history of health care in the USA and the great gains achieved during the 1900s. On this success Brent says
As he explained earlier that vision was to learn what was working and what wasn’t by collecting and studying data on patients and experimenting using the scientific method to improve health care results.
The presentation then explores the enormous opportunities for improvement in the current health care system. One of the many very interesting ideas Brent presents is the problem of spreading new medical knowledge to the people working in the healthcare system.
[People] couldn’t keep up. He [researcher] found that 3 to 4 years 14 to 15 years after initial board certification 2/3 of internists couldn’t pass the qualifying exam. Even better work came from John Williamson at Hopkins, Williamson demonstrated that for a major new research finding to make it into widespread practice across the United State takes about 17 to 20 years.
I hear a lot of talk about companies wanting to hire the best and the brightest (I’m going to abbreviate this as BaB for this article). But I wonder if that’s a great long-term strategy? Is there something better?
When building a business, we’re often so focused on the parts that make up the system of our business that we forget that our business is itself a part of a bigger system. Is it selfish for a business to hire only BaBs? Would it be better for that business, in the long haul, to hire average people and help them become great? Would that be a short term sacrifice that would benefit the bigger system and thus ultimately the business itself?
It’s interesting that there’s a book designed to teach managers how to keep the BaBs that they hired. That’s a fear isn’t it, with hiring a BaB – the fear of their mobility. Compare the loyalty of the BaB you just hired from another company versus someone who your company helped develop into a BaB.
“For all the hype that surrounds stars, human resources experts have rarely studied their performance over time. Six years ago, we started tracking high-flying CEOs, researchers, and software developers, as well as leading professionals in investment banking, advertising, public relations, management consulting, and the law. We observed that top performers in all those groups were more like comets than stars. They were blazing successes for a while but quickly faded out when they left one company for another.”
Why might this be? One of the key reasons cited has to do with systems. The performance of any individual is a combination of her own individual performance plus her interaction with the system in which she works. The equation looks like this, where P is performance, I is the individual’s contribution, and SI is the contribution due to the individual’s interaction within the system: P = I + SI
Even if you knew P, you’ve still got a single equation with two variables. And the SI term is constantly changing over time, so it’s ultimately impossible to measure. When you remove the BaB from their system and bring them into yours, you’ve really no idea what P will become.
A business that takes the long term view need not be in a rush to hire BaBs. Because it believes in strengthening the system in which it is a part, a business with long term vision will develop its employees. It will help its employees continue their education (and here I don’t necessarily mean a traditional college education). It will constantly bring in new knowledge from the outside and share that knowledge with any employee interested in learning.
When I look back on my life, the happiest, most energetic and productive times were when I was in a development spurt. I was eager to challenge myself, venturing outside my comfort zone little by little, and getting better every day. And it’s not just my experience. Listen to Liz Wiseman talk about the power of rookies. But people won’t take themselves out of their comfort zone, learn, and develop, unless they feel safe.
Many business environments are not suitable for inspiring learning. We only learn by making mistakes, and when mistakes are not tolerated, or there’s an environment of fear, or short term thinking, forget it – you’re not going to have much luck growing BaBs from within.
If, however, you build an environment free from these things, safe and conducive to exploration and learning, this is a very sustainable model. This leads me to one last great reason to build your own BaBs instead of hiring them from the outside: those BaBs know how important it is to preserve the environment in which they flourished. A rock star from the outside won’t have this important understanding, and what’s worse, they may bring along baggage from their previous company which tends to threaten that safe environment you’ve worked so hard to build.