Where is Occum when you really need him?

Where is Occum when you really need him?

May 17, 2019 | Change, Leadership, Personal Rant

We need Occum’s Razor to be applied to our deliberations on all sorts of things, from our personal and professional lives, to the  way politics is being practised around the western world.

The term comes from the writings of William of Ockham, a 14th century philosopher monk, and calls for simplicity of logic, the removal of superfluous ingredients when you have a simpler idea that accommodates the facts just as well.

In effect,  strip an argument back to its essential elements, and work with the facts. Conjecture, personality, and status quo of all kinds should play no part in the development of an idea.

Tomorrow is federal election day 2019, the culmination of a campaign that really started back in August last year when Malcolm Turnbull was rolled by his own party.

The ‘campaign’ has been little more than a display of clichés, vague and inconsistent promises,  and pork barrelling to both fragile electorates and interest groups. I guess to be fair, it must be said that the Labor party has at least set out to articulate an agenda of change that does make an offer to voters, but the chief salesman is a dud.  

What appears to be happening more and more is the phenomena of ‘Occum’s Broom’, which suggests that inconvenient facts and unwanted insights are swept under the carpet. Utilising Occums broom is both intellectually dishonest, and way too easy to deploy as a shortcut to some sort of outcome preferred by one group or another, who seek power.  

By Sunday, we will know who wielded the broom to the best effect, at least in the house of Representatives. In the Senate, I suspect there will be a bit of a wait as the dust from the broom settles its way through the myriad of minor ‘parties’ whose primary vote is limited to their families, and a few zealots.

Bob Hawke passed last night, and I cannot help but wonder if his passing will deliver a telling fillip to the Labor vote, as we are confronted by personalities from both sides observing his great contribution to the nation, and to the practice of politics as a means to make positive and lasting change.

The header cartoon is again by Hugh McLeod at www.Gapingvoid.com and represents the question we will all be asking ourselves come Monday.

 

Electric Vehicle manufacturing: The prospects for Australia.

Electric Vehicle manufacturing: The prospects for Australia.

Apr 29, 2019 | Change, Innovation, Leadership

One of the more fanciful of a grab bag of fanciful bullshit surrounding the ‘debate’ on electric cars a fortnight ago was the assertion that South Australia could become a world centre of electric vehicle manufacturing.

It seems superficially logical, all those car assembly and supplier plants sitting idle, and all those manufacturing skills being wasted as the former  employees become unemployed baristas. However the entry barriers to successful manufacturing and export, and infrastructure requirements for domestic market penetration beyond central suburban areas, are significant.

GM in the US is quietly packing its bags on EV development and manufacturing to shore up profits, particularly in the light of the halving of federal Green House Gas ( GHG ) subsidies. The Californian ZEV credits scheme to encourage electric vehicles, which contributed greatly to the initial research momentum may not be enough by itself to maintain the momentum.  Tesla, the poster boy of electric vehicles is walking a financial tightrope, despite its undoubted success in the market.

Labor appears to have done a bit of homework, if reports are correct, so perhaps there is hope. However, it seems to me the core of electric vehicles, where Australia has some level of competitive ability that can be protected and leveraged is the R&D solving the storage problems, subsequent battery production, and lithium mining and processing.

Lithium, the base of current battery technology is not easily available. However, Australia has considerable Lithium resources, well behind Chile and China, but carrying more sovereign certainty despite the regulatory and political hurdles.

Let’s hope the flights of oratorical fancy yet to come in this election campaign are founded on fact and solid strategic thinking, rather than what sounds good in front of a populist audience.

Anyone for a debate on Adani? (some facts and consistency of argument would be nice)

 

 

The 2 simple questions, which when answered, will improve everything

The 2 simple questions, which when answered, will improve everything

Apr 17, 2019 | Leadership, Operations

There is a very simple, elegant way of improving anything, from a complex factory production line to something more personal, like improving your tennis. 

Determine the constraints, and remove them progressively. It is the key to improvement, that can become a continuous process.

Imagine a production line with three machines through which every product must pass consecutively to complete the transformation. The first has a capacity of 3 tonnes/day, the second 5 tonnes, and the third, 10 tonnes.

The capacity of the system is 3 tonnes/day, it is constrained by machine 1, and spending any resources improving machines 2 and 3 will be an absolute waste beyond the routine maintenance required to keep them working. It does not matter how much you spend on machines 2 and 3, machine 1 remains the system constraint.

This simple observation forms the basis of improvement, best articulated in the book ‘The Goal‘ in which Eli Goldratt articulated his Theory of Constraints almost 40 years ago.

The theory of constraints, summarised is: ‘Any system with a goal has one limit at a time, and worrying about anything other than that one limit is a waste of resources’

Many have still not got the memo.

The two simple questions:

  1. What is the current constraint?
  2. What is the best way to address the constraint?

If you go back to the example, adding a tonne/day to machine 1 increases the capacity of the system dramatically, while adding the same tonne to machine 2 or 3 makes no difference at all to the capacity.

I play tennis, a  great game for life, but I am now 40 years past my best. However, recently I played a match against someone who was clearly a much better player than me, and won. While a surprise to most, (including me)  it was simple. He had a poor backhand, and no matter how good his serve, forehand, and volley, so long as I could reach his backhand, I was in with a chance on every point. That was his constraint, to the point where even a minor improvement in his backhand would see him beat me easily.

Any business system can be analysed in the same way, and doing so enables the most productive allocation of resources to be made.

However, business is far more complicated than a game of tennis. There are functional silos, personal agendas, and ingrained behaviours that have to be navigated, and they are rarely as obvious as a dodgy backhand.

The system for identifying them however is the same: observation combined with data.

The first part of any StrategyAudit assignment is to do a diagnostic, of which the identification of constraints to improved performance is a key component. It normally breaks down into a number of common high level or ‘cultural’ and strategic buckets, shaped over time by the leadership of the enterprise:

  • Priority and task management
  • Knowledge management
  • Customer focus and management
  • Continuous improvement and Innovation management

These are then further broken into more functionally oriented constraints, Marketing, Sales, Operational, HR, and so on.

The constraints in these functional areas should be identified, prioritised, and progressively addressed. The hidden constraint at this stage is the necessity for cross functional collaboration, as constraints in one area impact on the constraints in others, and inevitably, behaviours emerge to accommodate.

Back to the simple example.

If the sales function has the ability to sell that 3 tonnes/day of production across a range of differing products that all go through the same three machines, the constraint will no longer be just the 3 tonnes/day on machine 1. It will be the changeover times required on machine 1 between runs of differing products, which reduces the capacity of the machine.

The obvious solution, almost always followed, is to do longer runs of each product to maximise the ‘up-time’ on machine 1,  and sell from inventory. However, this solution does not address the constraint, it just consumes extra resources (working capital and storage space) to  work around it. Customers suffer with extended delivery lead times driven by the less flexible production scheduling necessary, and drift away. The much better solution is to reduce the changeover times on the machine, while resisting the strident calls from the Sales Manager to invest in greater capacity as a means to shorten delivery lead times. While continually reducing changeover times does have a limit, at which investment may be required, in my experience, it is almost always the quickest, and cheapest way to generate ‘extra’ capacity.

When one of your constraints is existing management practise and culture, give someone who has the necessary experience to address the challenges a call.

 

 

Believe what they do, not what they say.

Believe what they do, not what they say.

Apr 8, 2019 | Governance, Leadership

Last week I was reminded, again, to take what people told you with a grain  of salt, and to watch closely what they did, rather than believing what they said.

I watched as the CEO of a significant business took a decision that was in direct conflict with the values he regularly espouses to staff and customers, in the interests of a short term cost mitigation.

He did not seem to accept the inconsistency when it was pointed out.

In the early 70’s as a student, I did a couple of holiday stints as a door to door market researcher. In one project, we were banging on doors and asking which brand of cigarette was smoked (in those days, smoking was widespread). When the answer was one of a couple of premium brands, we had to persuade the respondent to show us the packets in the house, and half the time, it was one of the cheaper brands.

Had we accepted what they said, rather than confirming with what they did, the research results would have been even more rubbish than they were.

Putting yourself in the shoes of a research respondent is really hard. It requires empathy, close observation, robust but sensitive questioning, and savvy choices in who you talk to if the results are to be reliable. It also offers the opportunity to gather insights into behavior that enables better product and service design, uncovering unstated or unrecognised problems being faced.

I hesitate to mention, we are about to go into an election campaign, the reality is we are already there, with the welter of blather, tired clichés and bullshit about to overwhelm us, again. As a community, we should really point out to all who want our votes the truth of the post headline.

Illustration credit: Tom Gauld from Instagram.

Why is deep domain experience so valuable?

Why is deep domain experience so valuable?

Mar 15, 2019 | Communication, Leadership

As an old(ish) former senior exec sort of bloke, watching this crop of younger managers come through, I find myself disturbed.

It often seems that while they know the facts, and at an intellectual level, recognise the impact, they do not seem to understand them in any instinctive sort of way.

It is disturbing, particularly as I look forward in this country and cannot help but be pessimistic, and wonder where the general equivalent of the ‘corporate memory’ of Australia is hiding.

I grew up in the late 60’s and early 70’s. The social fabric of  the world was changing at a rate that arguably has not been matched since, or will again. Not the tech world, the one we inhabit daily. The music, to that time unquestioned social behaviour, our trust in the institutions, and Vietnam: a war my now grown children know almost nothing about, that changed everything.

Trying to articulate the difference between just knowing this stuff, and really understanding it is really hard, but try this, if you are now well into your 60’s.

Let it be. The Beatles

‘Close to you’. The Carpenters.

‘In the Summertime’. The Mixtures

‘Bridge over troubled waters’. Simon & Garfunkel

‘Looking out my back door’. Credence Clearwater

‘El Condor Pasa’. Simon Garfunkel

‘Up around the bend’. Credence Clearwater

‘Knock knock who’s there? Liv Maessen

‘Whole Lotta Love’.  Led Zeppelin

That is the top 10 singles in Australia in 1970. Throw in a few of the tracks that have a place in your personal history, to make the list 15 or so. On my list would be Leonard Cohens ‘Suzanne’.

Now, ask a 35 year old about the list, they will know some of the tracks, perhaps many, but it will be a list of songs, words on paper, perhaps even a tune, but there will not be a visceral connection.

They did not live through it, their understanding is intellectual, there is no emotional connection to their soul.

Having deep domain experience is the same thing, intuitive, visceral, extremely hard to articulate, but of immense value when harnessed.

 

Picture credit: New Yorker Magazine. (The second time I have used it).

 

 

 

 

 

 

 

The problem with politics

The problem with politics

Feb 22, 2019 | Governance, Leadership, Personal Rant

We are facing two elections here in NSW, one for the state government, and then federal almost immediately following.

What a mess we are in, disengagement, distrust, cynicism on the part of the electorate, and flatulent promises and claims by the body politic.

The problem is trust.

There is none.

When I apply what I have learnt in 45 years of commercial life to this problem of trust in politics, I come up with a few simple observations.

Lack of strategic clarity.

There is no consistency between the claims and stated objectives of each of the parties and the experience of those who will be voting. The same party cannot even get their messages consistent between the state and federal levels of the parties, so why on earth do they think we, the electorate will believe their conflicting, fatuous and hyperbolic messages.

No accountability.

As a director of several companies, there are rules that apply that demand truth be told to shareholders. Clearly these rules do not apply to politicians as they talk to their stakeholders, we, the electorate. I would be dragged into court if I told the sort of porkies, used facts selectively and out of context, and generally failed to answer any question in a substantive manner,  the way politicians do as routine. They take credit for good things over which they had no influence, and blame the others  for any outcome that can be painted as poor. They are simply unaccountable for their promises, there is no sanctions on them beyond the cliché about the ballot box being the ultimate sanction.

We feel scammed every day as a result.

Governance, where is it?

The governance of government, and political processes generally, leaves a lot to be desired. It is appropriate that there are rules about the manner in which public money is spent. However, when the rules get in the way of common sense and equity, while leaving gaping holes through which the scammers can swim, it can be seen as a system that favours those in the know, at the expense of the rest of us. It is also the case that when  you regulate something, by definition, behaviour not captured by the regulations is OK, irrespective of the morality of the behaviour.  This can be clearly seen in the case of the financial services cesspool uncovered by Royal Commissioner Hayne. 

To be fair, public governance is a massive task of strategic and moral leadership,  and there are bound to be missteps, but we need to be better than we are, by a mile.

As a final observation, these people cannot govern themselves, why is it then so strange that we do  not trust them with the wider task of governing the rest of us?

Absence of cross functional collaboration.

When it is clear that the right hand does not know  what the left is doing, and seemingly does not care, why would we trust either? This not only applies to the functions of any individual government, but to each of the three levels we are burdened with, overlaid by the federated structure of states we are left with from colonial times.

We could not design a model better able to stuff up just about everything they touch if we tried!

The only antidote to all of the above is leadership. The sort of leadership  that takes responsibility, offers a compelling vision of the future and articulates a credible path towards it, is prepared to take difficult decisions and argue the logic publicly, then lives to be accountable for it all.

Pity there is so little of that going around.

 

Cartoon header credit: Again, Hugh McLeod at gaping void nails it!