I had breakfast today with a gentleman I know from the swimming community, Ira. Ira has had a long and varied career in a number of industries, but the one that may have given him the most intercultural experience is banking, where he was stationed in Hong Kong for awhile. His experience in banking gave him a really mature view of capitalism and culture. We had a long conversation about what’s gone wrong in the U.S. of A. – why are companies and our government so short-sighted these days. And of course we came away from breakfast with all the answers, if only someone would listen.
One element I introduced is an enormous cost focus. In environments where the cost side and the benefits side are poorly connected – which is most companies with a traditional management style, unfortunately – the only way most companies measure their people in cost centers is reductions in costs. I sometimes combat this with the idea that if all you want to do is reduce costs, then just send everybody home. The resulting conversation usually centers on the value being provided, and the poor connection cost centers often have to that value they generate.
An anecdote I mentioned is something I learned 45 years ago from my Dad as he got caught up in it. As it transpires, the Nixon Administration made a decision to eliminate government-based research and development arms. There were many such R&D organizations, and with a stroke of his pen Nixon eliminated all of them, except, I believe, those within DOD. My Dad, for example, was employed in R&D at the Department of Transportation, and suddenly he was on the street. Is it appropriate for the government to explicitly spend taxpayer dollars on the long view? It’s hard to say, but we know a couple things, first that most for-profit organizations will not spend, or spend very little, on the long view, and second that a culture often stems from what’s going on at the top. I contend that the elimination of any focus in government on the long-term contributes to the lack of focus in American industry likewise. So my answer is a measured Yes.
Ira encourages balance in the consideration of four collections of stakeholders to a company, any company. I think this applies to (government) as well. They are:
• The shareholder (taxpayer) – looking for business value
• The customer (citizen) – looking for personal value
• The employee – looking to make a contribution
• The enclosing community – looking to enhance, well, community.
Do companies today achieve this balance? We think not. In particular, the employee today is being given extremely short shrift. How long will that last? Ira fears a revolution. No, he doesn’t mean like the American Revolution. He means a sea change in the way organizations and employees interact. Airbnb, Uber and other such organizations may already be hinting at this. If we don’t have any employees …
Many of humanity’s best innovations have come from large groups of teams crafting good business results around a tight vision to which they are justifiably loyal. Agile and Lean motivate this sort of behavior for good reason. Hewlett Packard comes to mind as one of the best of these organizations. And how far has HP fallen since its high? I know several former HP employees who still crow about the loyalty, how hard they worked, the crispness of vision, and the incredible results they achieve. I don’t know how far they’ve fallen – it depends on whether you look at HP, Keysight or Agilent. Oh … I guess that division itself tells the lion’s share of the tale.
Agile’s values (agilemanifesto.org) are germane, particularly the first one in this case as it asks for the fundamental of respect:
• Individuals and interactions over processes and tools
• Working software over comprehensive documentation
• Customer collaboration over contract negotiation
• Responding to change over following a plan
If my experience is any guide, many large companies are having an extremely difficult time adopting Agile. The difficulty is more than “change is hard” , which already makes it pretty darn hard. We all know change is hard. But some companies can’t do it, even though they know it’s important. In any initiative, we have uncertain outcomes (often poorly articulated unfortunately), reasonably well understood (and somehow never inexpensive!) costs, and finally the benefits from those outcomes generally don’t begin to accumulate visibly until a significant amount of the initiative has been implemented. (In a pure Waterfall environment, no benefit accrues at all until the entire effort is complete!) The essential issue too often seems to be we can’t afford to change, because our view is too short-term to articulate the benefits enough to outweigh the costs, or in terms of money so that one can directly compare benefits to costs.
What we realized today over breakfast is that a similar argument seems to be in play regarding cultivating and retaining employee loyalty. We gotta fix that.