By Hans Norden
Special to Slightly East of New
I’m observing how there is, at least within management education, a dichotomy between two paradigms; one that builds decisions on the belief that money is the highest value (see Small is Beautiful by Fritz Schumacher) and another that builds decisions on systems thinking, or quality; improving the capability of a system. It’s interesting how Boyd described Orientation as the Schwerpunkt of his thinking; the paradigm through which to observe one’s environment, including new and unforeseen circumstances as they unfold.
It seems to me that people have a hard time even opening their minds to beliefs that are in conflict with their mental programming; they even reject the idea of just trying it on for size, so to speak. It was an intelligent investment banker who explained to me why Deming was not widely used, not because his ideas were too complicated but because people simply do not believe that they are true!!!??? They experience a ‘short-between-the-ears’ when their Orientation fails to make sense out of their Observation of Deming’s System of Profound Knowledge. Subsequently, their lack of Fingerspitzengefühl suppresses their curiosity. (After Chet’s presentation, why was there neither a single question nor any opposition? In other words, a dialogue in which they engage the messenger.)
Therefore, it is not surprising to read a description by Janis and Mann1 of a common pattern by which decision makers react to new and unforeseen circumstances. Convinced that trying more and better of the same proven methods must work, they will work “smarter not harder,” even do more with less, until it is too late to try anything else.
Robert M. Pirsig writes in his epic book Zen and the Art of Motorcycle Maintenance that “Quality is the goal at which methodology is aimed”. He also explains how quality is different because people have different perceptions of what quality is. Therefore, what one believes to be the most valid method on which to construct a decision (= Orientation) is of vital importance.
Now take a look at all the ‘leadership’ stuff out there, completely devoid of any appreciation for the system or, I guess what Boyd would have called, the Force. Even though no one questions the importance of investing in the vehicle for a F-1 race or NASCAR, it has been best practice to erode the capability of the “Vehicle for Business” with operational efficiency measures in order to cut cost. Everything must make financial sense so, screw the vehicle’s basic principles (= Orientation) on which the vehicle’s capability is based.
Deming was known for saying that the most important numbers are unknown and unknowable, referring to the incurrence of waste, re-work, eroding profit margins, warranty claims and unhappy customers. Eventually, those numbers will make their way into the financials, and analytical minds are ill-equipped to deduce a cause and effect relationship between newly adopted operational efficiency measures that are eroding the vehicle’s capability, and higher production cost. So, they decide to do more and better of the same!?
A recent report by IBM found that execs from all over the world are perplexed by complexity and events. No wonder that they are puzzled by events when they don’t understand how a business functions as a singular, unique, integrated and open system. Interestingly enough, those same executives in the IBM study concluded that the antidote to complexity and events had to be found in creativity!? But, creativity without appreciation … isn’t that called “trial and error”?
Management education is obsessed with analysis at the expense of synthesis, to the extent where people get confused when confronted with multiple and sometimes conflicting ideas/principles. Executives are equally obsessed with the possession of deep-domain expertise by their current/future CEO: Deeper deep-domain expertise is regarded as more desirable, despite the fact that a chief executive assumes ultimate responsibility for the entire business (value chain), which requires more of a generalist than a specialist. This reminds me that Boyd recognized two kinds of people; those that can build snowmobiles and those that cannot.
In observing my environment, I notice that quality household appliances, cars, city busses, etc. are all European brands. Which paradigm do they embrace on the other side of the pond? Money (status quo) or quality (Development of a business system’s capability = Evolution)? Is it possible that (some major) US brands are unwilling to satisfy customers’ specific needs? Is the rationale for mergers and acquisitions to take away choice whereby they can pass on the high cost of their under-developed capability to buyers? Why do US executives decide to use retained profits for buying back their own shares instead of developing their business’ production capability?
1)Decision Making: A Psychological Analysis of Conflict, Choice, and Commitment by Irving L. Janis and Leon Mann
Hans Norden is principal and owner of Anticipated Outcome and author of of the forthcoming book The CEO Adventure, How to Differentiate Yourself from Others with the Same Know-How. He was the organizer of the Boyd for Business and Innovation conference in San Diego in February 2014.