Archives: January 2008

Innovation and Architecture

The Center for Creative Leadership recently released the findings of their study of senior executives’ opinions of the future trends they face. It is no surprise that the increasing complexity of their challenges was forefront on the executives’ minds. As authors Corey Criswell and André Martin noted in the introduction to the report, “Senior executives face increasingly complex challenges that involve organizational changes, market dynamics and talent shortages. One popular response to increasing complexity is to lean on innovation. Our respondents believe that aiming for innovation through overt processes (systems and structures) and talent development is paramount to creating a culture that is agile enough to address complex challenges.”

I certainly hear the cry for innovation often in my client work. Simple logic would argue that creation of an innovative culture cannot occur without first innovating current business practices. All too often the stories I hear of innovation revolve around the lone wolf who somehow beat the existing system. Innovation will not be widespread until the systems, practices, policies, and procedures are changed so that innovation becomes the path of least resistance. It may even be counterproductive to preach innovation and fire up the troops if they run smack into barriers that discourage it. Cynicism often occurs, followed by disengagement of talent when they wonder why they should bother.

In our model for analyzing and creating solutions (which you can explore by clicking here, or on the Future Shape of the Winner button in the left-hand column of this page), we recognize this architecture as being a key component of successful change. If innovation is the goal, perhaps the focus shouldn’t be restricted to encouraging the players. Instead we should look seriously at the playing field. Some examples I am seeing include rigid organization structures, project teams being populated by those who are available rather than those who are necessary, resource allocation that doesn’t value investment in innovation, and metrics that reward traditional practices over innovative approaches. There are, of course, many forces affecting innovation or the lack of it. But examining current architecture seems to me to be a good place to start.

What are you seeing? Examples? Challenges? Emotional outbursts?

For Steve Fans

A lot of you comment when he blogs, so you might want to see Steve Yastrow live on the Fox Business Network.

Steve will be speaking to Neil Cavuto on the show named Cavuto, Thursday, 31 January 2008, 6:00 p.m. Eastern (U.S.) time.

Fox Business Network is a new cable TV network in addition to Fox News Network. Search your cable stations.

Annual Opportunity

I happened to hang out with a lot of financial advisors this week. At two different times I found myself in conversations where advisors were talking about their strategies for conducting annual review/planning meetings with clients whose investments they manage. I was struck by the contrast:

1. The first firm was genuinely interested in using the annual review/planning meeting as a chance to build their relationship with their client. We discussed how to make the meeting a relationship-building encounter, as opposed to a rote, obligatory, perfunctory process.

2. The second firm described their standard process for an annual meeting, in which an annual plan update is produced in such a way that the advisor can easily sell additional products to their client at the meeting.

All else being equal, which strategy, do you think, is more likely to generate the most revenue over time?

What's Fresh?

Conversation! Join in over your morning coffee or your nightcap this weekend at the PSF wiki. We’ve added a new badge to the front page (over there underneath the TP Wire Service box in the right column). Simply click on the box and read what people think about real world applications of Tom’s PSF50 list. Don’t forget to add your own.

Book Page

Sure, you’re a Tom-fan. But have you read ALL the books he’s written? Did you miss one? Or perhaps you’d like to find your favorite Peters classic read aloud by the man himself (chances are good since he’s recorded almost all of them). Find it all on the newest page at the site, Tom’s Books.

PRAISE BE!

The management of high performing creative-types is certainly on the agenda for many of my clients. Who else can we rely on to come up with the next breakthrough idea in our organisations, but our high performing “talent”? But, as Lucy Kellaway in London’s Financial Times recently wrote, there is an important balance to be struck in dealing with such folks.

There is something almost mystical about real talent, whether it be artistic, scientific, sporting, or creative, but as Lucy points out in her article, adulation and excessive appreciation alone can result in the creation of a monster. We end up with someone who feels able to make excessive demands, without any resulting requirement for performance improvement!

The article made me think about the delicate balance that my singing teacher manages to pull off. She typically manages to leave me with the feeling that I am making progress, and sounding good, but that there is another level to which I should be aspiring. So I am generally left feeling energised and excited, but certainly not complacent. I think that many sporting regimes manage to pull off this approach through the persistent measurement of personal best performance.

What is it about our relationship with our talented professionals in our work organisations that can get in the way of pointing out where (even they!) can improve?

What is your best experience of being encouraged to stretch and develop your talent when there was no obvious need to do so?

Madeleine McGrath posted this on January 24, 2008, in Talent.
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When Five Sigma Trumps Six Sigma

[This is the first blog post at tp.com, by special request from Tom, by Cool Friend Jeff Angus. You may remember him as the author of Management by Baseball. Hence, this blog entry.—CM]

A week ago, Tom posted an entry about a recent book by an adoring courtier of Jack Welch, though reading it suggested to Tom … “a self-serving picture of an organization run by a misogynist egomaniac—you’d have to be nuts or a former male Navy Seal to want to have worked there. Welch comes across as a brutal, soulless, foul-mouthed boss who revels in putting people down in the most demeaning ways.”

And yes, it’s inarguable, as one of my favorite MBA ex-clients who wishes he could have been a courtier in Welch’s operation has said, that Welch’s combination of vision and execution made him “Six Sigma” as an organizational operative. Stats nuts know that Six Sigma represents the 99.99999980268th percentile, and it’s no coincidence that to get there he achieved soullessness.

(more…)

PNC Financial Services Group

On this day of global market madness, I’m in Pittsburgh talking to leaders at PNC Financial Services Group. At first blush, “Ouch” would seem to be the order of the day. But hold on. First, through good sense or good luck or both, PNC’s subprime exposure is minimal. Moreover, the company has a bushel of awards that distinguish them as far different from banking’s mindless conglomerators. PNC is a 2007 “BusinessWeek 50″ top performing company, on Fortune’s “Most Admired” list, on numerous other lists such as “Best Companies for Working Mothers,” “Top 10 Companies for African-Americans,” “Top 50 Employers for Women,” “CIO 100 for Technology Excellence,” etc. So, why do they need me? Beats me, but I’ll do my best to roil the waters here and there.

[Slides are here.—CM]

Beyond Belief!
(Not!)

In my ever-changing, annotated “Implementation” Presentation, version 0119, at Slides 137-145 you will find a riff on the power of “simple” checklists in reducing hospital errors. My presentation drew this incredible—ever so credible!—Comment by Manoj Pawar, M.D.:

Regarding the slides based on information described in the excellent New Yorker article by Atul Gawande, “The Checklist”: [checklists] are ever so important.

The next chapter in this story is extremely important, as described in the NY Times Op-Ed piece by Dr. Gawande.

I urge you to read the Op-Ed piece.

The gist: A simple checklist, similar to pre-flight checklists used by pilots, has been proven to reduce ICU deaths. People die less … much less … as a result of this. Plans to spread this nationally in the US were underway. Simple. Elegant. And primed for implementation on a broad scale, BUT …

The Office for Human Research Protections (OHRP), upon learning of this, stopped the project immediately.

Why? The OHRP treats this as research (despite the fact that results are proven). Because they see it as research, they feel that it was unethical that patients were not informed that a checklist was being used, and that its use was being measured. In essence, they treated this in the same way that they would a study in which patients were being given a medication with unknown efficacy.

Can they really do this? Sure. And in fact, they can cut off all federal funding to groups (hospitals, researchers, etc.) that fail to obey.

Since that 12/30/07 decision, health care institutions and quality improvement specialists across the country have been running scared, fearing the wrath of the OHRP and the subsequent loss of funding. They’ve asked their quality improvement folks to stop doing what they’re doing immediately, based on these legal and regulatory concerns.

A number of prominent healthcare bloggers share their concerns. Check out healthbeatblog.org to see Maggie Mahar’s blog.

We all are left asking, “WHY?”

With such great results, who would want to stop this work? Maybe it’s the folks who fear exposure of how truly bad our hospitals currently are. Imagine the loss in market share for those that don’t use the checklist! Maybe it’s about money.

Analogy: We’ve done process improvement work to look at and improve compliance with ideal handwashing guidelines (yes … not all doctors wash their hands as much as they should). But imagine if we had to get informed consent for patients to participate in this work! “You may be subject to an intervention … your doctor may actually wash his/her hands, and, as such, you may be exposed to something that isn’t consistently done.”

Innovation isn’t common when it comes to healthcare operations and processes. When it happens, (even if it’s something simple like a checklist), do we really want to squelch it? The lesson for implementation: Watch out for the barriers to implementation. And when barriers sometimes seem insurmountable, there are times when radical action is necessary. When our Denver-based healthcare think tank met last night, I suggested civil disobedience as one approach. Do it anyway, and worry about the consequences later. Be radical … be remarkable!

Manoj Pawar, MD, MMM
Posted by Manoj Pawar at January 19, 2008 12:13 AM

Headline, page 1, Boston Globe, 20 January 2008:

“Broker’s clients detail web of dashed dreams”

“When Marcia Neilson couldn’t qualify for a home loan in early 2006 because of poor credit, her mortgage broker, Nicole Lyder, had an unusual solution: Add Neilson’s daughter to the loan application.

“Neilson’s 21-year-old daughter had just lost her job, but Lyder remained undeterred. ‘That wasn’t a problem,’ Neilson recalled her broker saying.

“Neilson’s real estate agent said Lyder enlisted him to drive Neilson and her daughter to Brockton City Hall. The pair filled out a business certificate that claimed they owned a hair salon in Brockton.

“The Neilsons qualified for a mortgage and bought a Dorchester house in June 2006 for $565,000. Last fall, Marcia Neilson learned from state investigators looking into Lyder’s business practices that her loan application was padded in other ways: a statement for a $25,000 bank account in Neilson’s name that she had no knowledge of.

“Fake documents, a phantom borrower, and other irregularities were common features of five subprime mortgages brokered by Lyder between November 2005 and June 2006 that were examined by the Boston Globe. Lyder’s clients ranged from the barely employed to struggling working-class couples; one had just left a homeless shelter and two others gave up government-subsidized housing to buy homes. They said Lyder arranged loans that they later realized had monthly payments that far exceeded their means. All five loans are now in foreclosure.”