Hi There,
Its been too long time to away from blog, its very much awkward feeling of being away from your blog.
Anyway Following is the Chapter narrated by Peter Shenge in his renowned book FIFTH DISCIPLINE.
Does your Organisation have learning Disability.
Few large corporations live even half as long as a person. In 1983, a Royal Dutch/Shell study found that one-third of the firms that had been in the Fortune “500” in 1970 had vanished. Shell estimated that the average lifetime of the largest industrial enterprises is less than forty years, roughly half the lifetime of a human being! Since then this study has been repeated by EDS and several other corporation and served as a point of reference in
James Collin’s Good to Great, published in 2001. The chances are fifty-fifty that readers of this book will see their present firm disappear during their working career.
In most companies that fail, there is abundant evidence in advance that the firm is in trouble. This evidence goes unheeded, however, even when individual managers are aware of it, The organization as a whole cannot recognize impending threats, understand the implications of those threats, or come up with alternatives.
Perhaps under the laws of ‘survival of the fittest’, this continual death of firms is fine for society. Painful though it may be for the employees and owners, it is simply a turnover of the economic soil, redistributing the resources of production to new companies and new cultures. But what if the high corporate mortality rate is only a symptom of deeper problems that that afflict all companies, not just the ones that die? What if even the most successful companies are poor learners-they survive but never live up to their potential?
What if, in light of what orgainsation could be, “excellence” is actually “mediocrity”?
It is no accident that most organization learn poorly. The way they are designed and managed, the way people’s jobs are defined, and most importantly, the way we have all been taught to think and interact( not only in organization but more broadly) create fundamental learning disability. These disability operate despite the best efforts of bright, committed people. Often the harder they try to solve problems, the worse the results. What learning does occur takes place despite these learning disability- for they pervade ail organizations to some degree.
Learning disability are tragic in children, especially when they go undetected. They are no less tragic in organization , where they also go largely undetected. The first step in curing them is to begin to identify the seven learning disabilities.
1. “I AM MY POSITION”
We are trained to be loyal to our jobs – so much so that we confuse them with our own identities. When a large American steel company began closing plants in the early 1980’s, it offered to train the displaced steelworkers for new jobs. But the training never “took”; the workers drifted into unemployment and odd jobs instead. Psychologist came in to find out why, and found the steelworkers suffering from acute identity crisis’s. “ How could I do anything else?” asked the workers. “ I am a lathe operator.” When asked what they do for a living, most people describe the tasks they perform every day, not the purpose of the greater enterprise in which they take part. Most see themselves within a system over which they take part. Most see themselves within a system over which they have little or no influence. They do their job, put in their time, and try to cope with the forces outside of their control. Consequently, they tend to see their responsibilities as limited to the boundaries of their position. Many years ago, managers from a Detroit auto maker told me of stripping down a Japanese import to understand why the Japanese were able to achieve extraordinary precision and reliability at lower cost on a particular assembly process. They found the same standard type of bolt uses three times on the engine block. Each time it mounted a different type of component. On the American car the same assembly required three different bolts, which require three different wrenches and three different inventories of bolts-making the car much slower and more costly to assemble. Why did the Americans use three separate bolts? Because the design organization in Detroit had three groups of engineers, each responsible for the entire engine mounting, and probably much more. The irony is that each of the three group of American engineers considered their work successful because their bolt and assembly worked just fine. When people in orgainisations focus only on their position, they have little sense of responsibility for the results produced when all positions interact. Moreover, when results are disappointing it can be very difficult to know why. All you can do is assume that “someone screwed up”.
2. “The Enemy is out There”
A friend once told the story of a boy he coached in little league, who after dropping three fly balls in right field, threw down his glove and marched into the dugout. “ No one catch a ball in that darn field,” he said. There is in each of us a propensity to find someone or something outside ourselves to blame when thing go wrong. Some organization elevate this propensity to a commandment: “thoug shall always find an external to blame.” Marketing blames manufacturing: “ The reason we kept missing sales target is that our quality is not competitive”. Manufacturing blames engineering. Engineering blames marketing; “ If they’d only quite screwing up our design and let us design the product we are capable of, we’d be an industry leader.” The “enemy is out there” syndrome is actually a by-product of “I am my position.” And the nonsystemic ways of looking at the world that it fosters. When we focus only on our position, we do not see how our own actions extend beyond the boundary of that position. When those actions have consequences that come back to hurt us, we misperceive these new problems as externally caused. Like the person being chased by his own shadow, we cannot seem to shake them. The “enemy is out there” syndrome is not limited to assigning blame within the organization. During its last years of operation, the once highly successful People Express Airlines slashed prices, boosted marketing , and bought Frontier Airlines- All in a frantic attempt to fight back against the perceived cause of its demise: increasingly aggressive competitors. Yet, none of these moves arrested the company’s mounting losses or corrected its core problem, service quality that had declined so far that low fares were its only remaining pull on customers. For years American companies who had lost market share to foreign competitors blamed cheap foreign wages, labour unions, government regulators, or customers who “ betrayed us” by buying products from someone else. “the enemy is out there,” however , is almost is almost always an incomplete story. “Out there” and “In here” are usually part of single system. This learning disability makes it almost imposible to detect the leverage we can use “in here” are usually part of single system. This learning disability makes it almost impossible to detect the leverage we can use “in here” on problems that straddle the boundary between us and “out There.”
3. The Illusion of Taking Charge.
Being “proactive” is in vogue. Managers frequently proclaim the need for taking charge in facing difficult issues, stop waiting for someone else to do something, and solve problems before they grow into crises. In particular, being proactive is frequently seen as antidote to being “reactive” waiting until a situation gets out of hand before taking a step. But is taking aggressive action against an external enemy really synonymous with being proactive? Once, a management team in a leading property and liability insurance company with whom we working got bitten by the proactivenes bug. The head of the team, a talented vice president for claims, was about to give a speech proclaiming that the company wasn’t going to get pushed around anymore by lawyers litigating more and more claims settlements. The firm would beef up its own legal staff so that it could take more cases through to trial by verdict, instead of settling them out of court. Then we and some members of team began to look more systematically at the probable effects of the idea: the likely fraction of cases that might be won in court, the likely size of cases lost , the monthly direct and overhead cost regardless of who won or lost and how long cases would probably stay in litigation. Interestingly the teams scenario pointed to increasing total cost because, given the quality of investigation done initially on most claims, the firm simply could not win enough of its cases to offset the cost of increased litigation. The vice president tore up his speech. All too often, proactiveness is reactiveness in disguise. Whether in business or politics, if we simply become more aggressive fighting the “enemy out there”, we are reacting –regardless of what we call it. True proactiveness comes from seeing how we contribute to our own problems. It is a product of our way of thinking, not our emotional state.
4. The fixation on events.
Two children get into a scrap on the playground and you come over to untangle them. Lucy says, “I hit him because he took my ball.” Tommy says,”I took her ball because she wont let me play with her airplane.” Lucy says, “He can’t play with my airplane because he broke the propeller.” Wise adult that we are, we say, Now, now, children- just get along with each other.” But are we really any different in the way we explain the entanglements we find ourselves caught in? We are conditioned to see life as a series of events and for every events, we think there is one obvious cause. Conversations in organizations are dominated by concern with events: last month’s sales, the new budget cuts, last quarter’s earnings, who just got promoted or fired, the new product our competitors just announced, the delays that just was announced in our new product, and so on. The media reinforces an emphasis on short-term events – after all, if its more than two day old it’s no longer “news.” Focusing on events leads to “event” explanations: “The Dow Jones average dropped sixteen point today.” Announces the newspaper, “because low fourth-quarter profits were announced yesterday.” Such explanations may be true, but they distract us from seeing the longer-term patterns of change that lie behind the events and from understanding the causeses of those patterns. Our fiaxation on events is actually part of our evolutionary programming. If you wanted to design a cave person for survival, ability to contemplate the cosmos would not be a high-ranking design criterion. What is important is the ability to see the saber-toothed tiger over your left shoulder and react quickly. The irony is that, today, the primary threats to our survival, both of our organizations and of our societies, come not from sudden events but from slow gradual processes: the arm races, environmental decays, the erosion of a society’s public education system, and decline in a firm’s design or product quality (relative to competitor’s quality) are all slow, gradual processes. Generative learning cannot be sustained in an organization if people thinking are dominated by short-term events. If we focus on events, the best we can ever do is predict an events before it happens so that we can react optimally. But we cannot learn to create.
5. The parable of the boiled frog.
Maladaptation to gradually building threats to survival is so pervasive in system studies of corporate failure that it has given rise to the parable of the “boiled frog”. If you place a frog in a pot of boiling water, It will immediately try to scramble out. But if you place the frog in room temperature water , and don’t scare him, he’ll stay put. Now, if the pot sits on a heat sources, and if you gradually turn up temperature rises from 70 to 80 degree F., the frog will do nothing. In fact, he will show every sign of enjoing himself. As the temperature gradually increases, the frog will become groggier and groggier, until he is unable to climb out of the pot. Though there is nothing restraining him, the frog will sit there and boil. Why? Because the frog’s internal apparatus for sensing threats to survival is geared to sudden changes in his environment, not to slow, gradual changes. The American automobile industry has had a long-standing case of boiled frog. In the 1960s, it dominated North Ameracan sales. That began to change very gradually. Certainly, Detroit’s Big Three did not see Japan as a threat to their survival in 1962, when the Japanese share of U.S. market was below 4 percrnt Nor in 1967, when it was less than 10 percent. Nor in 1974, when it was under 15 percent. By the time the Three began to look critically at their own practices and core assumptions, it was the early 1980s and the Japanese share of the American market had risen to 21.3 percent. By the 1990, the Japanese share was approaching 25 percent and by 2005 it was closer to 40 percent. Given the financial health of U.S. car companies it is unclear whether this particular frog will ever regain the strength to pull itself out of the hot water. Learning to see slow , gradual processes requires slowing down our frenetic pace and paying attention to the subtle as well as the dramatic. If you sit and look into a tidepool, initially you won’t see much of anything going on. However, if you watch long enough after about ten minutes the tidepool will suddenly come to life. The world of beautiful creature is always there, but moving a bit too slowly to be seen at first. The problem is our minds are so locked in one frequently, it ‘s as if we can only see at 78 rpm: we can’t see anything at 33-1/3. We will not avoid the fate of the frog until we learn to slow down and see the gradual processes that pose the greatest threats.
6. The Delusion of learning from experiences.
The most powerful learning come from direct experience. Indeed we learn eating, crawling, walking and communicating through direct trail and error- through taking action and seeing the consequences of that happens when we can no longer observe the consequences of our actions? what happens if the primary consequence of our action are in distant future or in a distant part of the lager system within which we operate? We each have a “learning Horizon” a breadth of vision in time and space within which we assess our effectiveness. When our action have consequences beyond our learning horizon, it becomes impossible to learn from direct experience. Herein lies the core learning dilemma that confronts organization: we learnt best from experience but we never directly experience the consequences of many of our most important decisions. The most critical decisions made in organizations have systemwide consequences that stretch over years or decades. Decisions in R & D have first-order consequences in marketing and manufacturing. Investing in new manufacturing facilities and processes influences quality and delivery reliably for a decade or more. Promoting the right people into leadership posions shapes strategy and organizational climate for years. These are exactly the type of decisions where there is thw least opportunity for our trial and error learning. Cycles are particularly hard to see and thus learn from, if they last longer than a year or two. As systems-thinking writer Draper Kauffman, jr…points out. Most people have short memories. “when a temporary oversupply of worker develops in a particular field, he writes, everyone talk about the big surplus and young people are steered away from the field. Within a few years, this creates a shortage, jobs go beggins, and young people are frantically urged into the field-which creates a surplus. Obviously, the best time to start training for a job is when people have been talking about a surplus for several years and few of others are entering it. That way, you finish your training just as the shortage develops.” Traditionally, organization attempt to surmount the difficulty of coping with the breadth of impact from decisions by breaking themselves up into components. They institute functional hierarchies that are easier for people to “get their hand around.” But functional division grow into fiefdoms, and what was once a convenient division of labour mutates into the “stovepipes” that all but cut off contact between functions. The result: analysis of the most important problems in a company, the complex issues that cross functional lines, becomes a perilous or nonexistent exercise.
7. The myth of the management team.
Striding forward to do battle with these dilemmas and disabilities is “management team” the collection of savvy, experience managers who represent the organization’s different functions and area of expertise. Together, they are supposed to sort out the complex cross functional issues that are critical to the organization. What confidence do we have, really, that typical management teams can surmount these learning disabilities? All too often, team in business tend to spend their time fighting for turf, avoiding anything that will make them look bad personally, and pretending that everyone is behind the teams collective strategy-maintaining the appearance of a cohesive team. To keep up the image, they seek to squelch disagreement: people with serious reservations avoid stating them publicly, and joint decisions are watered down compromises reflecting what everyone can live with or else reflecting one person’s view foisted on the group. If there is disagreement, its usually expressed in a manner that lays blame, polarizes opinion, and experience in away that the team as a whole could learn from. “Most management team break down under pressure,” writes harvard Cris Argyris a longtime student of the learning in management teams. The team may function quite well with routine issues. But when they confront complex issues that may be embarrassing or threatening. School trains us never to admit that we do not know the answer, and most corporations reinforce that lesson by rewarding the people who excels in advocating their views, not inquiring into complex issues. (When was the last time someone was rewarded in your organization for raising difficult questions about the companies current policies rather than solving urgent problem). Even if we feel uncertain or ignorant, we learn to protect ourselves from pain of the appearing uncertain or ignorant. That very process block out any new understanding which might threaten us. The consequence is what Argaris calls “skill incompetence” team full of people who are incredibly proficient at keeping themselves from learning.
Regards
Amol
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