Plausible deniability?

That seems to be what many CEOs nowadays are going for: “Chiefs at Big Firms Often the Last to Know” (paywall), in yesterday’s Wall St. J. The argument goes

Bosses need to know what’s going on to make informed decisions, but that knowledge is dependent on what direct reports choose to tell them.

So you have lots of levels and filtering going on at every level. Pity the poor CEOs at the end of the chain.

To which I reply, “Only if they’re stupid.” Or their idea of management is to sit in their corner offices, ponder their enormous salaries, and receive the ministrations of minions. Continue reading

CEO to beancounters: Sit down!

On the one hand, it’s always to good to see sanity prevail:

Delta Chief Executive Richard Anderson studies daily cancellation reports and overruled arguments inside the airline that there weren’t enough cancellations to justify the cost.

As Wall St. J. airline columnist Scott McCartney writes (paywall), attitudes such as this help explain why Delta has the lowest cancellation rate in the industry, a whopping 50% below that of the next best airlines (Southwest and Alaska) and nearly 1/6 of the airline industry average of 1.7%. Continue reading

Maneuver retail — 2

Another in our series on improving the performance of retail operations and improving the quality of life for people in it. Last post, we looked at Nordstrom; today it’s Chipotle. Yesterday, the online magazine Quartz ran a feature on their management approach.

To start off, you have to give them credit for having a unifying vision:

“The foundation of our people culture, on which everything else stands, is the concept is that each person at Chipotle will be rewarded based on their ability to make the people around them better,” [Co-CEO Monty] Moran told Quartz. Continue reading

Don’t fence me in

Nordstrom, as management consultant Michael Solomon pointed out in a recent LinkedIn column, has only one statement in its employee handbook: “Use your best judgment in all situations. There will be no additional rules.” This is not, as he goes on to observe, quite true:

There is, however, a second element of nearly equal importance at Nordstrom and at every other great organization: standards.  Additional guidelines and internal, codified knowledge that support these employees and multiply the power of their “best judgment.” Continue reading

Boyd for Business & Innovation — Final Report

Chuck Spinney explaining some obtuse point about the OODA loop

Chuck Spinney explaining some obtuse point about the OODA loop

After my presentation, retired Marine Colonel Mike Wyly joined us from Maine via Skype to relate how the Marine Corps adopted the doctrine of maneuver warfare. Mike gave us a blow-by-blow description of a process in which he played a major role. Successful doctrinal changes by large organizations are rare: If you are the CEO of an organization considering such a change, you could do a lot worse than spending some time with Mike. His paper, “Thinking Like Marines,” is conveniently available on the Articles page. Following Mike, Sean Bone, co-founder of Adaptive Leader, demonstrated tactical decision games (TDGs) they use for training leaders in mental agility and timely decision-making under conditions of stress and uncertainty. This is real-world, practical stuff that I’m sure will be a great help to many of the participants.

Finally, for a successful implementation of Boyd’s ideas in business, Dean Lenane, then-CEO of CRH North America, described how he and his small team built CRH from no presence in the US market to a major player in their industry, explicitly using the principles of Boyd’s Discourse. Absolutely fascinating. Dean has written a thinly disguised novelization of one episode in this adventure, The Turnaround, which you can (and should!) also download from the Articles page. Continue reading

Boyd for Business & Innovation — 2

Before I forget, Chuck Spinney made a point about the OODA loop that bears repeating: Boyd did not want to draw the thing! In fact, he didn’t, until the penultimate chart in his very last briefing, less than a couple of years before he died.

Why not? Probably because he was afraid any “loop” he drew would become dogma, a reasonable assumption. Chuck finally persuaded him by using the logic that if he didn’t, others would. Most likely the circular O – O – D – A loop would become fixed in people’s minds. So Boyd agreed, but he insisted on calling it an OODA loop “sketch,” and putting “Loop” in quotes.

If you look at that briefing, the purpose of “OODA loops” (not “the OODA loop”) is simply to represent the process of evolving new implicit repertoire. Now, that’s a big purpose because our ability to survive on our own terms and increase our capacity for independent action rests solidly upon it. But it also suggests that people can create other OODA loops that serve their purpose better than Boyd’s sketch, at least in specific instances. All I ask is don’t make them more complicated than what we already have.

I have uploaded my presentation, slightly edited, to the Articles page. It’s a 3.1 MB PDF, and each element of each animation is saved as a separate slide, so don’t let the number of slides put you off. You can also download all of Boyd’s briefings, including the one we were just discussing, The Essence of Winning and Losing, from that page.

Boyd for Business and Innovation — 1

Got back on time from San Diego last night, which is saying a lot, considering what’s happening on the East Coast.  On the other hand, fifty-five degrees and horizontal rain isn’t something you generally associate with San Diego, but it’s still one of my wife’s and my favorite cities. [As I'm typing this, we're starting to get heavy rain here. It's followed me home.]

The conference was great. Hans Norden along with the staff at the Rady School of Management at UCSD did a fantastic job of pulling it together. If you didn’t make this year’s event, I think they’re planning for another to coincide with monsoon season next year.

Personally, it was a hoot meeting several folks that I only know through this blog. Thanks to all of you for coming and for your enthusiastic participation.

I’ll be posting more over the next several days. In the meantime, Chuck Spinney has given me his presentation, Evolutionary Epistemology, for posting, and it’s up on our Articles page now.  I’ve been watching this pitch evolve, if you’ll pardon the expression, since about the time Chuck first gave it. It just keeps getting better and better.

More stuff and impressions over the next few days.


Competition Rules

A little double entendre to start your Thursday.

First, an op-ed by Jacques Gansler in the NYT, “To Save on Defense, Hire Rivals.”

If monopolies are created in a quest for short-term savings, taxpayers eventually pay more and our country is less safe.

This is a favorite theme of mine, expressed as “If you can’t afford two suppliers, you certainly can’t afford one.” The question would be, “Who really wants to save on defense?”

And then there’s a short piece on LinkedIn by David Edelman on a favorite theme of Boyd’s, “Don’t be ruled by rules.”

And in a world of rule-based contacts, there is still important space that needs to be made for two people just being allowed to discuss a customer’s need and develop a solution. No one likes to sit through a canned set of questions when they agree to enter a chat window on a site or when they call a representative. We want a human, free-flow interaction. Many clients of ours have actually found that they resolve issues faster on the first round, cut call times, and have happier customers when they loosen the rules and give smart reps more leeway.

Slavishly following rules makes you predictable. This can be fatal in a conflict, and boring, and hence also fatal, in sales & marketing. It’s worth noting that a lot of this argument goes away if you replace most of your rules with an EBFAS-type culture.

I’m off to the Boyd conference in San Diego. More on that as it happens.

Adding it up

By the time I had grabbed my iPhone, slid to unlock, put in the passcode, found Calculator, punched in the numbers, punched in the right numbers, and read her the result, my wife had easily figured the answer to a tax problem on a scrap of paper. Worth her studying math for 12 years in school?

“No,” is the clear answer given by Simon Jenkins in yesterday’s, “For Britain’s pupils, maths is even more pointless than Latin.” I completely agree. For one thing, except for what she regards as the most useless subject of all times, Euclidean geometry, she wasn’t doing math, or “maths,” as they say over there, at all. She was, basically, learning to replace a calculator.

Continue reading

Another note on cheng / chi

As you may recall, the idea of playing off the expected, cheng, with the unexpected, chi, plays a major role in Boyd’s conception of maneuver warfare. Following Sun Tzu, Boyd advises engaging with the cheng, and winning with the chi. This is the strategy of deception: Go in with something the opponent believes he has figured out, ideally with some effort on his part in order to set the hook, as it were, then at the moment you believe will have the most paralyzing impact, spring the chi. Boyd has a nice summary on Patterns 132.

As I’ve mentioned before, and devoted an entire chapter to in Certain to Win, this idea translates nicely over to business. Give the customer what he expects, wants, needs.  In simple terms, the product or service you provide has to work and do what you’ve told him it will do.

But customers become bored, eventually, with this approach. To hook them for the long term, you also need the unexpected, the surprising, the delightful. This may not be just the product or service itself but could include customer service or even packaging. For years, Apple was the master of this approach.

Hiroshi Mikitani had a nice cheng / chi piece yesterday on LinkedIn: “Selling distinction in the Internet Age.” Mikitani is the founder and CEO of Rakuten, the Japanese Internet retail giant that bought a few years ago. What’s interesting about Mikitani’s approach is that he’s advising not more delightful packaging, which you could implement as well through Internet sales as anywhere else, but shifting to a new domain entirely.

What’s important is that your business think in these terms. Harried CEOs sometimes regard anything other than getting product out the door as distractions or at best “nice-to-have,” and bean counters look on them as added costs — i.e., they get points for griping about them or worse, eliminating them. Actions like these leave you open to smarter competitors.

What I recommend instead is that from the very beginning you regard your Schwerpunkt as not the chi nor the cheng but cheng / chi.