Change means change the system

 

There are now quite a number of people in organisations who have learned something of Vanguard’s methods. We do make it look easy, and we find people frequently make the same mistakes, for example classifying customer demand in internal terms, not customer terms. But the biggest problem they have is not starting with top management. Before we start our work we have a discussion with the top manager (leader) that describes what the change is going to look like – what it means to change from command and control to a systems design – and we also make it clear that ‘this means you too’ – if the leader is not prepared to have his or her thinking challenged about the design and management of work and that means, for example, roles and measures, it is better not to start.

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The problem is exacerbated by the fact that using the Vanguard methods, even poorly, improves performance; so the ‘old’ measures (which should have been removed) show improvement. Top managers then put the Vanguard methods in their mental ‘projects’ box as just another method. Unwittingly, by staying focused on the wrong measures these ‘leaders’ continue to do things that damage performance and morale. The people who have been turned on get turned off. It is not a good thing to have staff thinking bad things of their top managers.

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It is hard for people in an organisation to have a discussion with their top manager to say ‘this means you too’. But it is an essential step in the change. It has such a profound impact on performance and sustainability. The change is a change to the system and the system is governed by the way managers think about the design and management of work. You can’t duck it.

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Why don’t ministers learn?

 

Despite the well-documented failures of large-scale IT projects in our public services, we now have a four billion pound project in the health service. Politicians think installing ‘state of the art’ IT will improve health care. This means having every hospital and surgery electronically linked to 50 million patient records. It means we will be able to make appointments on-line and keep records of tests, x-rays and the like. It is classic case of features (IT functionality) being assumed to be benefits.

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The protagonists believe the inevitable resistance – ‘staff will want to know how this helps them do their job better’ – will be overcome with a ‘huge communications programme to try to instil a sense of ownership’.

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They’ve got just about everything wrong. For more on why IT fails when the above logic is followed read the book and/or read the article: “Is IT bugging you? At: http://www.lean-service.com/6.aspt (the last article listed).

We are about to throw away loads of public money and the biggest (consequential) costs will be incalculable.

 

Another bad ministerial habit

 

As well as assuming IT will improve performance, ministers assume ‘problems’ can be ‘solved’ by ‘projects’. So, for example in the health service we see ‘improvement facilitators’, who know nothing about the work and are paid more than staff nurses, being responsible for ‘improvement projects’. There is a plethora of similar jobs in all public services. The people who do the jobs stumble around trying to work out what to do and most often end up establishing and reporting on measures (targets etc) that do nothing to help people understand and improve the work. They do not know that change can only start with knowledge, without it they just makes things worse.

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In the police we now have a ‘national anti-bureaucracy task force’, whose job it is to reduce bureaucracy. What do these people who work in the anti-bureaucracy project do? They ask for suggestions on a form that is sent to committees for evaluation and the best are sent to another committee. Doesn’t anyone in the police or home office see the madness?

 

I ask for a change of policy

 

We (Vanguard) have become drawn in to doing work with the public sector over the last couple of years. We now have public sector clients who have achieved levels of performance that could never have been conceived as ‘achievable targets’. To take just one example that has been put in the public domain (by Housing Today): Home Housing achieves all housing repairs in eight days (and does so with less resource). It is so far outside the national norm as to be extraordinary, yet anyone could achieve a similar result. Other housing organisations have done the same and more will do likewise in the coming year.

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I wrote to James Strachan, chairman of the Audit Commission asking him to publish a policy statement along the following lines:

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‘When the leaders of an organisation can show they have understood and improved performance in a sustainable manner, if in their view the requirements as specified by any governmental specification or agent (inspector) are contrary to improvement, that is conformance (implementation) would add no value or create waste, then the leaders would be entitled to refuse to comply with the requirement.’

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It reflects where we are with our work in the public sector. We know of a variety of requirements (specifications) that are ill judged, not based on knowledge of the work, and which should be ignored. I want James Strachan to provide the scope for Vanguard clients to stand up to their inspectors with good reason. The policy ensures they would only do so from a position of strength, having been able to demonstrate they have both understood and improved performance. It also minimises his risk, the greatest of which is dispute between the inspector and inspected.

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I wrote to Mr Strachan in November, I guess this takes a bit of thinking about.

 

Targets just don’t work

 

I now make regular presentations to public sector audiences in which I use practical examples to prove that: There is no method for setting a target; targets serve to sub-optimise performance (always); previously unimaginable improvement can be achieved with capability measures.

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Some people in the audience express their worries about what Mr Strachan’s people – the inspectors – would think about it. I cannot imagine that is what Mr Strachan wants.

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Unions make the wrong call

 

Unions have attacked out-sourcing call centre work to India as corporate greed. It is a foolish argument. Capitalism is, after all, all about profit. But the problem with out-sourcing to India is deeper.

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Call centres in the UK are running at high cost and offering poor service. Managers out-source to tackle the cost problem. But unwittingly they lock in costs and worsen service. When you study the nature of customer demands into call centres you find high levels of what I call ‘failure demands’ – demands caused by a failure to do something or do something right for the customer. Failure demand can run as high as 60-70% of all demands. Sending this work to India makes the problems more difficult to solve, especially when the contract is based on transaction costs.

Why don’t managers know about this (and related problems)? Because they sit far away from the work and use only transaction measures (volumes of calls and costs) to make decisions.

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Leaving aside the horrid neo-imperialism and deceit represented by teaching people in India about our TV programmes and the like, we are, effectively, out-sourcing our ‘sweat-shop’ call centre culture to India. Despite the relatively high wages, call centres in India suffer very high turnover of staff. They are dreadful places in which to work.

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The sweat shop culture is created by management’s attention to ‘production’, so workers are measured on their activity. In truth the major causes of variation in performance are in the work, not the workers. If you subject a rat in a ‘Skinner box’ to these conditions it wets itself. We do it to our workers and now we do it to Indian workers.

The solution is to design against demand. Workers are best able to do this. I explain all of this in my new book (a major plug I know). The unions should be making the case, as I do, that the workers are essential to improving service and reducing costs. In cases where this solution has been applied costs fall, service improves, morale improves and the organisations achieve greater sustainability. Isn’t that what the unions want?

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The balanced score card

 

A reader writes:

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“I just saw a presentation on the balanced score card. The presenter said the purposes are: Alignment and integration of developments and a structured and systematic review of strategy implementation. Of course it amounted to no more than Management by Objectives with new clothes.”

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It is. And this is why it would appeal to the command and control thinker. No stuff in the balanced score card on how to establish measures that would help you understand and improve the work. But plenty of the same in my book 

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In the book I illustrate how people adopting the balanced score card simply collect together and add to their current command and control measures. The consequences are more bureaucracy, more sub-optimisation of performance and less knowledge of what is really going on.

 

Education: who loses?

 

A reader writes:

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“A teacher friend of mine is deputy head in a county junior school. She explained to me how the former head had made herself unpopular with the staff through pointless initiatives. IiP was a particular bane of their lives, leaving them at the end of the process with a certificate, but feeling less valued.

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As sometimes happens with natural variation, the school then had a brilliant academic year group and went to the top of the tables. The education authority singled it out as a ‘Beacon School’ that everyone should follow. My friend found herself asked to tour the county explaining what they had done, without really believing it. The following year group were average and the school duly fell back into the pack for ‘achievement’. The head, meanwhile, had seen the next year coming and took the opportunity to leave her Beacon School for a promotion while the going was good.

I suspect that the people at the top are those who benefit from this system, and are therefore the least likely to challenge it.

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A longer term effect of this tampering is that ‘high achieving’ schools attract motivated parents in what looks like a virtuous circle. However, worse off children are left with no choice of schools, those which are more likely to end in a vicious spiral into the ‘failing’ category.”

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Really sad isn’t it? Who loses?