The Business Sensei

Take a Future Retrospective

Originally published in Corp! Magazine.

Once upon a time there was a staircase. Although it wound its way up from floor to floor in the manner traditionally associated with staircases, this was no ordinary staircase. Although it stood in a courthouse in Franklin, Ohio, in a fashion much like other staircases, yet it was not like the other staircases. With most staircases, those who look down see stairs beneath their feet. With this staircase, however, those who looked down saw the floor below and those people walking up the stairs. They saw those who stood at the bottom of the staircase, for this staircase, you see, was made of clear glass. While we have no information as to whether those climbing the staircase felt a sense of vertigo when they looked down, we do have definitive information about what they said when they looked down: “Hey, those people at the bottom of the stairs are staring up my dress.”

Although the news report was slightly vague on this point, we may safely assume that this comment was made only by those who were, in fact, wearing a dress.

But yes, it seems that people on the staircase made an observation that had eluded the architects who designed the staircase: that if you can look down through the glass, you can look up through it as well.

When questioned on this point, the architects responded by saying that they had naturally assumed that no one would be so inappropriate as to stand at the bottom of a glass staircase in a courthouse and look up women’s dresses.

When this insightful observation was relayed to the judge, he replied that, “If people always exercised good judgment and decorum, we wouldn’t need this building.”

The architects had carefully considered their building material. They had thought about how to make the glass durable and resilient. They had considered the problems involved in building a glass staircase in such a way that it would continue to look good even after having hundreds of people walking up and down it each day. They had, in fact, solved each one of these problems.

What they had not considered was how the customer, to wit, the people in the courthouse, would actually use the product. They were so fixated on the concept that a staircase is for walking on, not staring through, that they failed to consider the ramifications of their architectural decisions. To be fair, architects are hardly unique in making this type of mistake. It can be very easy to let your assumptions about how something should work or how it will be used to blind you to how it will actually work or be used. Consider the example of the business school competition to design a helicopter. The contest was judged on a number of factors, including the weight of the finished product. The winner was the helicopter without an engine. Apparently, no one had included “able to fly” in the criteria for success. The assumption that, of course, a helicopter should fly was so taken for granted that no one thought to see if it was included in the rules.

On the bright side, it had considerably less severe consequences than the situation involving the helicopter that flipped upside down while in flight. Or the data analysis software package that looked like it had crashed the computer, causing users to reboot shortly before the calculations were complete. Or the organizational improvements that led to a massive talent exodus.

In each situation, the people designing the end result honestly believed they were giving the customers, including the employees in the final case, what the customers had requested — and that belief prevented them from considering any other possibilities.

“We asked!” the designers protested. “That’s what they said they wanted.”

Were the customers really asking for a helicopter that flipped upside down or an expensive glass staircase that had to be subsequently covered? Of course not. But somehow, that’s what the designers heard.

The problem was that they asked the wrong questions, further leading them into their one, narrow, view of the result. Thus, no one ever stopped to imagine how the end product, be it staircase, contest rules, helicopter, software, or organizational procedures would actually be used.

In each situation, rather than seeking information, the people asking the questions sought validation. They already had an idea in their heads, and any inquiries they made were aimed at confirming that idea, not testing it.

When you say, “This is what you wanted, right?” or “What do you think of this approach?” odds are you aren’t requesting information; you are requesting validation. Indeed, even if you are seriously trying to get information, such questions usually get you validation instead. This is because the client assumes that you, as the expert, know what you’re talking about.

So how do you ask for information? One answer is to change the time frame. Instead of asking them to imagine the future, pretend it’s the future and imagine the past: “If we went with this approach, and six months from now you weren’t happy, what would have gone wrong? If you were happy, what would have gone right?”

This small change causes people to actually imagine using the product or living with the new procedures. Now, instead of validation, you’ll get information. That information may shake up your carefully constructed vision of the future, but that’s fine. Better now than after the sightseers congregate at the bottom of that glass staircase. A future retrospective also forces you to be more honest with yourself and to address the issues in front of you.

What challenges is your business facing? If, six months from now, you had successfully addressed your most persistent problems, what would you have done to make that happen?

How to Use Sports to Advance Leadership and Organizational Development – Steve Balzac with James Rick

Here’s the blurb from my appearance on the Full Potential Show. For the actual show, click here.

Can sports be used for more than just fun and pleasure? You bet!  The same disciplines or character development, leadership and team based skills applies to almost every other domain in life.

Steve Balzac is a man of many talents. He is a consultant, speaker, and author of 36-Hour Course in Organizational Development. He is a popular speaker on such topics as leadership, team building, interviewing skills, and sports performance. In this interview, he shares the lessons he has learned from the sports he excels in – Jiu Jitsu and fencing – and how they tie-in with the honing of leadership and organizational development potential.

THE TIE IN

a)    Use the other person’s force against him (as in Jiu Jitsu)
b)    Meet and go with the force of the other person in order to take him to where you want him to go
c)    In a difficult situation, attract the other person to where you want to take him
d)    Don’t be afraid to try different techniques, even if you have to look like an idiot sometimes
e)    Explore and practice the fundamentals well (as in fencing)
f)    Build yourself to a point where you can stay focused for long periods of time
g)    When you’re up there, you should not care whether you win or lose. If you focus on the outcome, you doubt yourself and hesitate
h)    After preparing your team, give them permission to go off and achieve what they need to
i)    Look at mistakes as the cornerstone of innovation and as a part of the process of evolution
j)    Determine if mistakes repeatedly committed is due to a flaw in the system
k)    Don’t do all your research ahead of time – it’s impossible to know everything ahead of time
l)    Develop a culture where it’s acceptable of everybody to commit mistakes, including you
m)    Consult with your followers to show them you’re interested in listening to their ideas

FINAL POINTERS ON LEADERSHIP AND ORGANIZATIONAL DEVELOPMENT:

1)    Tell your own story – what you’re trying to do and why you care about it
2)    While you should have an outcome, dwelling on it during show time can actually hinder performance
3)    Walk your way backwards through the steps from the outcome – this will make the first step very easy
4)    Don’t be afraid to ask someone to show you the way (no team makes it to the Olympics without a coach). This will shorten your learning curve.

FINAL THOUGHTS

• “Experiment” is synonymous with mistakes and breakthroughs.

The Corporate Culture Conundrum

I get asked a lot about corporate culture. In this case, I ended up responding to a very detailed query at such length that I decided to include it here since I doubt the person interviewing me will be able to use all of what I wrote (I’m also posting this after the article comes out, so I don’t upstage anyone).

Let’s start by defining culture. At root, culture is nothing more than the residue of perceived success. In other words, it is the accumulated knowledge of how to be successful at a particular company and how the company is successful in the marketplace.

Why success and not failure? Simple. We tend to repeat the behaviors that appear to bring us success, and discontinue those that do not. Moreover, cultures based on failure simply do not survive. At some point, there have to be successes in order for the culture to remain viable.

I focus on perceived success because what really matters is not whether a behavior is really successful so much as our belief that it is successful. For example, in the 1990s, Nokia firmly believed that its success was due to its innovative management style. The reality was that they had a hot product, cell phones, in an exploding market. When the market saturated, their revenues dropped off along with every other cell phone provider in 2000. Today, Nokia is increasingly irrelevant. If everyone at the company had come to work wearing Groucho Glasses every day, their product would still have sold and they might very well have ascribed their success to their innovative dress code. The results would have been pretty much the same, although people might have been inspired to tell better jokes.

Because culture contains within it the memory of success, it is very hard to change. No one likes to change what’s working! What’s worse is that a behavior rarely succeeds all the time: when something doesn’t work, we ascribe the failure to “not trying hard enough” and resolve to do better. The resulting semi-randomness to the success produces a response similar to playing a slot machine: random success is highly addicting.

This phenomenon becomes particularly important when we realize that the business environment changes more rapidly than the culture. A once successful behavior gradually stops working. However, because it fades out slowly, intermittent successes along the way serve to make the behavior stronger and stronger even as its usefulness is decreasing. When it comes to not changing a behavior, it takes only the occasional success to make up for an awful lot of getting kicked upside the head.

This also means that there are two key aspects to culture: what we do and why we do it. Most organizations focus purely on the “what” and ignore the “why.” Even when an organization attempts to change culture, they almost always focus on what they are doing. Unfortunately, when you only change the what, you are changing the superficial. The underlying why will rapidly pull the new behavior back into alignment with the original behavior; although cosmetic changes may persist, the new “what” will be fundamentally identical to the old.

The “whys” of culture also interlock: there is rarely one reason for a particular behavior. As a result, attempting to change one “why” can also be quite difficult because a) it’s hard to identify it precisely, and b) the rest of the interlocking structure of beliefs pulls it back. It is quite possible for a CEO or senior management team to simply chop off a piece of a corporate culture, but it can be quite unpredictable what else they’ll lose: for example, when IBM dropped its traditional full-employment policy, they also lost a great deal of employee loyalty and their historic “IBM takes care of me and my family, I take care of IBM” employee mindset.

With that said, let me jump over to your questions:

1. How do you know when there's something wrong with your corporate culture (what are 2-3 signs), or how do you know if things need improving just a bit?

Something is “wrong” with a corporate culture when the culture can no longer obtain resources, that is to say clients and revenue, from its environment. The early symptoms can manifest in several ways before the revenue drop really hits. The most common is a persistent feeling of being stuck: more and more effort is expended for less and less success. Previously successful revenue generating behaviors are losing their effectiveness, but doing so in fits and starts.

Another common symptom is increasing defensiveness on the part of management: executives don’t want to hear why something isn’t working, and attempts to address problems are met with denial. At exactly the point where the executive team should be bringing in outside help, they become increasingly unwilling to do so. An outsider is far too likely to grind the sacred cows into hamburger. IBM’s decision to bring in Lou Gerstner in 1992 is an example of a company overcoming that fear of outsiders and actually addressing their problems.

A third symptom of culture problems is a persistent inability to make and keep decisions. When teams within the company, or the company as whole, continually revisits discussions and can’t seem to follow-through on goals, that’s a major warning sign that you need to take action.

2. Where do generational differences among staff and colleagues come into play?

Let’s start with the elephant in the living room: the Gen Y myth. This whole concept that Gen Y’ers are somehow less dedicated, less motivated, or less <insert here> than Gen X or Boomers is, quite simply, a myth. Indeed, the whole idea that the younger generation is less respectful, dedicated, hard-working, and so forth, than their elders is itself a cultural belief that goes back at least to Socrates.

What is different, however, is that Gen Y’s do not share the cultural belief that you graduate from college, work at one job for 40 years, and retire to enjoy your “golden years.” While this was, or at least appeared to be, a valid cultural belief at one time, it is no longer valid in the current environment and shows no signs of regaining validity. However, for those who grew up with it, it is very difficult to put it aside.

Within an organization, what matters first is not the generational differences but the degree of immersion in the culture of the organization. Younger employees are less deeply immersed in the culture; they’ve had less time to absorb it and to assume its values. Thus, they are more likely to propose ideas and approaches that older employees view as violating cultural values and hence are more likely to reject. Note, by the way, that I’m referring less to chronological age than to amount of time with the company. Since the older employees typically have more authority, younger employees are more likely to be frustrated. How they cope with that will, however, be strongly influenced by their generational cultural values: a Boomer or X’er might decide that if they stick around and pay their dues, they’ll get a voice in due time; a Gen Y’er is probably more likely to go somewhere else. One solution is not inherently better than another.

3. How do you cultivate a creative and collaborative team (what 2-3 three things can really build that team culture)?

Culture is whatever is seen as successful. If you want people to collaborate, reward collaboration. Sounds simple, but it just doesn’t happen. Companies focus on individual performance and individual reward. As a result, they get a bunch of individuals often competing for a limited pie. While it is important to acknowledge and reward individual contributions, that cannot be all that you reward and it should never be set up in a way that creates competition between team members.

4. It's all about innovation, how best to encourage creative brainstorming for service/product innovation (what works and what doesn't and why)?

There are four culture traps to avoid and four cultural beliefs to build. The four traps are:

Perfection — We must make the perfect mousetrap… which works until someone comes along with a cat.

Protection — We must not hurt our existing products. Pity our competitors don’t feel that way…

Identity — We’re an X not a Y. IBM was a serious business company in the 1980s. They didn’t “do games.” Now they’re heavily involved in serious gaming.

Creeping Box — We’re so far outside the box no one can catch us. Just ask Yahoo… Once you move outside the box, the box grows and suddenly you’re just one of the pack.

The cultural values to foster

Continuous education — Keep people learning. Don’t limit people to taking classes in their areas of expertise; rather encourage employees to study whatever interests them. Innovation comes from putting together apparently disparate pieces of information.

Making mistakes — How do you respond to mistakes? Innovation is a messy business. If mistakes are punished, no one will risk making them and innovation will falter. Thomas Edison famously said that he’d learned a thousand ways to not make a light bulb. Easy to say, hard to live.

Strategic breaks — Allow the breakthrough to happen. The “eureka” moment doesn’t happen when we’re exhausted from banging our head against the wall. It comes when we take a break and do something different. Learn how to take breaks strategically.

Patience — Don’t wait for a crisis to force your hand. Necessity may be the mother of invention, but waiting for the last minute to start innovating is the number one cause of premature death amongst new ideas.

5. How do intangibles like volunteerism, office greening, impact corporate culture?

Intangibles matter to the extent that they reflect the corporation’s values, beliefs, and aspirations. Volunteerism can be very important in a company that views itself as a good citizen of the community. However, to be effective, intangibles have to be worth the time and energy expended on them. If employees who volunteer their time end up being paid less or promoted less frequently than those who don’t volunteer their time, volunteerism will fade out. The behavior that is rewarded will become part of the culture, and the culture will attract those who believe in the values manifested through the behavior.

6. What are other intangibles that are important but corporations may not be keen about their importance?

How meetings are conducted, whether employees are permitted to work from home, how much freedom and autonomy versus direction employees are given, how mistakes are handled, how disagreements are managed, how permissible it is to question authority, are just a few of the intangibles that shape cultures.

7. How important is culture today and why?

Organizational culture is probably the most important most powerful force in any corporation. Because culture is the lessons of the past, it provides the template for how to behave in the future. Once a corporation loses sight of its culture, it’s only a matter of time before it slams into a brick wall.

8. Is your sense that most firms are focused on their culture, why or why not?

While many firms focus on their culture, they focus on the wrong aspects of it. Most companies focus purely on the “what,” those superficial artifacts that are easy to see but which have the least significance. It’s hard to focus on the “why.” Indeed, really delving into the “why” of your culture is rather like performing open heart surgery on yourself. In other words, you need the assistance of a trained outsider who is not immersed in your culture to see the elements you take for granted.

9. Any interesting, stats, surveys or other data about corporate culture?

Let me point you my book, “The 36-Hour Course in Organizational Development.” Chapter one is about culture and the entire book discusses how organizational development shapes and is shaped by culture.

10. If a company can make only one change in it's culture, how to determine what should be that priority?

The biggest priority is changing the belief that you can change only one thing… Seriously, culture change is not a precise, surgical operation. Sure, if you’re only after changing the “what,” you can pick one thing, but for anything non-trivial you have to go after the “why.” That requires taking the time to really understand what values and assumptions that are taken for granted are no longer valid, and then building up a new set of values and assumptions. Most culture change fails because it tries to focus too narrowly on one thing. Corporations go through a lot of pain and spend a lot of money only to experience a fleeting success before the culture reverts back to the way it was: when you seek to change only one thing, everything connected to that one thing acts to pull it back to its original form.

A Tale of Two Light Bulbs

As published in the CEO Refresher

Cut Big Problems Into Solvable Pieces and Get Moving

As published in Corp! Magazine

If a tree falls in the driveway and no one is awake to hear it, does it make a sound?

Of Deck Chairs and Ocean Liners

As published in The CEO Refresher

“Just give me the numbers!”

Falling firmly into the “I just can’t make this stuff up” category, the preceding statement was made by the head of a certain engineering department. He wanted the performance figures on a series of database lookups so that he could determine if the database code was performing up to specifications. This would be a perfectly reasonable request except for one minor problem: the database code was not producing the correct results in the first place. Performance was sort of irrelevant given that getting the wrong answers quickly is not necessarily all that helpful, although it may be less irritating than having to wait for the wrong answers. It’s rather like driving at 75mph when lost: you may not know where you are or where you are going, but at least you’ll get there quickly. Or something.

In another example, the engineers developing a bioinformatics data analysis package spent all their time arguing about the correct way to set up the GUI elements on each page. The problem was that when they actually ran one of the calculations, the program appeared to hang. In fact, I was assured by everyone, it just “took a long time to run.” How long? The answer was, “maybe a few weeks.”

This may come as a shock to those few people who have never used a PC, but a few weeks is generally longer than either a PC or a Mac will run before crashing. Besides, the complete lack of response from the program regularly convinced users that the program had crashed. The engineers did not want to put in some visual indicator of progress because they felt it wouldn’t look good visually. They refused to remove that calculation from the product because “someone might want to try it.” Eventually, they grudgingly agreed to warn the user that it “might take a very long time to run.”

In both of these cases, the team was solving the wrong problem. Although there were definitely complaints about the speed of the database, that was very much a secondary issue so long as the database wasn’t producing correct results. And while the user interface decisions were certainly important, designing an elegant interface for a feature that will convince the user that the product is not working is not particularly useful. At least rearranging the deck chairs on the Titanic was only a waste of time. It didn’t contribute to the ship sinking.

The element that made each of these situations noteworthy is that in both cases there were people present pointing out that the wrong problems were getting all the attention. The people making the decisions didn’t want to hear that. They wanted to solve a certain set of problems and, by golly, they were going to solve them! This is a version of the Hammer syndrome: when all you have is a hammer, everything looks like a nail. Sometimes, though, that nail turns out to be a thumbnail.

So why were these teams so insistent upon solving the wrong problems? Fundamentally, because they could. Simply put, if you give someone a problem they can solve comfortably, and one that they have no idea how to approach, they will do the former. In addition, they had never established clear metrics for success, never established standards by which they would know if the database was fast enough or the user interface was good enough. As a result, they built their goals and evaluated their performance around those issues. They were not being evaluated on whether they got the right answer, despite the opinions that the customers might have in that regard.

While clear, specific goals are certainly good things, goals also have to make sense. When a company is constantly seeing flaws in its products, it can be a very valuable exercise to look at the goals assigned to each person and each team in the company. Do those goals make sense? What problems or challenges are they addressing? Are the goals complementary, or are there significant gaps? If the engineering team is being evaluated on how many bugs they can fix and the QA team on how many new bugs they can find, what happens to the step where fixed bugs get verified? If no one is responsible for that happening, it won’t get done (and didn’t, in several software companies!). If the team focuses on the wrong problems, they’ll spend their time fighting symptoms or revisiting solved problems, and never deal with the real issues.

Therefore, even before you can set goals, you have to know what the problem is that you are trying to solve. That means first separating the symptoms of the problem from the problem itself. The symptoms are only symptoms; frequently, they can point to many possible problems. It’s important to look at the symptoms and brainstorm which problems they could be indicating. When you start developing solutions, you then need to ask what the final product will look like if you go ahead with your solution and you need to know what success looks like. Make sure that your proposed solution will actually solve at least some of the potential problems you’ve identified, and develop some way of testing to make sure you are solving the correct problem. In other words, have some checkpoints along the way so you can make sure that you’re actually improving things. Only then can you start to set goals that will effectively guide you to producing a quality product.

What are you doing to make sure that you are not rearranging deck chairs on the Titanic?

On KKZZ 1400 AM Tuesday 1pm ET

I’ll be interviewed tomorrow at 1pm ET on KKZZ Radio. I’ll be speaking on organizational culture and innovation: the two-edged sword.

The call-in number for the studio is (805) 639-0008.

The interview streams over the Internet at BrainstorminOnline.com.

Feel free to call in and ask questions, talk up my book, etc 🙂

Read the first chapter of my book (via Amazon Kindle for the Web)

Business Lessons From the Avengers (pt 1)

I have a fondness for old time radio podcasts. Indeed, one of the big advantages of the iPod is that it created a whole slew of opportunities for those of us who want to listen to such things. One of my discoveries was a podcast of the Avengers radio show. Yes, there was one, although it didn’t really come from the Golden Age of radio, rather being adapted from the TV show. Nonetheless, listening to episodes of the Avengers pointed up four very important points:

1. Russian accents are only the second most villainous sounding accents. British accents are the most villainous, probably because they always sound like they have anti-social personality disorder.

2. British accents also sound heroic, at least when they aren’t the villains.

3. Old time commercials in a British accent sound like something out of Monty Python.

4. When word “helpless” is said immediately before “Emma Peel” you know someone is in for a very nasty surprise.

I’m not entirely sure what this means, although the first might reflect my image of Boris Badenov as the quintessential Russian villain. Since this year is the 50^th anniversary of Rocky and Bullwinkle, perhaps Russian accented villains will make a comeback. I’ll leave that to James Bond (or Moose and Squirrel). What is more interesting is how well a 1960s cold-war espionage show holds up half a century later. Despite all our changes in technology and politics, and the much touted generational shift in the workplace, it should come as no big surprise that human nature hasn’t changed at all: people are still, basically, people, and John Steed and Emma Peel are just as suave and sophisticated today as they were fifty years ago. Despite all the noise about Boomers, Gen X, and Gen Y, there are also some things about the workplace that simply haven’t changed, although our perception and understanding of them might have.

In my book, “The 36-Hour Course in Organizational Development,” I discuss the twelve key elements of building a successful business. These elements are, in many ways, as timeless as John Steed and Mrs. Peel, if not always quite so sexy. They are, however, the key points that any entrepreneur needs to work with if you want to maximize your chances of creating a successful business.

Read the rest at Under30CEO

The Taboo of the Bananas: Organizational Culture and Recruiting

Once upon a time there was a company known as Robotic Chromosomes. Don’t bother Googling it; it’s no longer in business, and besides, that’s not the real name. Robotic Chromosomes had a way of hiring programmers that isn’t all that unfamiliar to folks in the software industry: logic puzzles. Like Microsoft, and various other companies, Robotic Chromosomes put every potential engineer
through a series of logic puzzles in order to determine if those engineers were qualified.

There is, in fact, no actual correlation between programming ability and the ability to solve logic puzzles.This did not stop the folks at Robotic Chromosomes, who were convinced of the validity of their methods and were not interested in allowing facts to get in the way.

Even within the logic puzzle method, though, there were some definite oddities and idiosyncrasies that distinguished Robotic
Chromosomes from other companies.

For several years, no one skilled in visual presentation or user interface development was ever good enough to solve
the logic puzzles, or at least they could never satisfy the solutions that the existing engineers believed were correct.

Read the rest at the Journal of Corporate Recruiting Leadership