Three Sigma Systems

Here’s a current events tie-in with my “Secret of Success” post.

From SailWorld.com:

There is little doubt that the many Court actions over the 33rd America’s Cup have been a major turn-off for the sport and sailing fans generally.

In a couple of days the sport will see a sailing match of the likes that has never been seen before and probably will never see again. Two of the highest performance yachts will square off against each other in a fascinating contest, conducted under the bare minimum of sailing rules.

Money is no object

Two of the world’s most “successful” guys are in the midst of a protracted battle royal that will culminate 25 miles off the coast of Valencia, Spain, when one or the other cheats his way to two out of three meaningless wins in the 33rd America’s Cup sailing regatta.

My Bay Area neighbor, “successful” self-made Larry Ellison, the 66 year old founder and CEO of Oracle and 9th richest man in the world, is spitting, scratching, and yowling in his fight with Ernesto Bertarelli, the European aristocrat who rates as the 52nd richest in the world by virtue of the bio-tech empire he inherited

It’s interesting, and very sad , to watch these two going at it, but the lessons to be learned, as I suggested in my previous post, the secret of “successful” people is their aim to manipulate the system to their personal advantage rather than improve the system so that everyone can win. Read more…

As is clear in his notorious 14-points, Dr. W. E. Deming was adamantly opposed to the use of motivational incentives by management. He saw goals, targets, performance evaluations, and pay-for-performance schemes as destroyers of the system of people. He said the correct function of management is to “remove obstacles to joy and pride in workmanship”. I have suggested that the very ideas suggested by motivational theory might be best abandoned. My suggestion is one of those ideas that I think of as bordering on the edge of chaos. It challenges conventional thinking and pushes our thinking envelope.

In this post I use an engineering analogy to explain how the idea of motivation may lead us in the wrong direction.

Note: For the sake of continuity, I have created a new category called “Motivation” that gathers my blog posts on the subject so that readers can look back at previous entries on the subject.

I am a great fan of John McPhee, who writes a good deal about the contradictions produced by the hubris of technologists who push buttons, pull levers, drive bulldozers, and otherwise bully our environment by “motivating” it to fit our needs and desires. The following analogy was inspired by the essays included in his book, “The Control of Nature“, which I commend to your attention.

Analogical argument in favor of repurposing organizational management

Imagine that there two engineers who have been tasked to come up with a plan for getting water to a location called B from its current location called A.

Remove obstacles to the flow

Engineer 1 is an ambitious fellow. He draws up a plan to move the water in a straight line by motivating it up and over mountains using pumps and siphons. He argues in favor of his plan by saying that by “motivating” the water he can direct it along the shortest and most reliable path to point B.

Engineer 2 is an older and wiser fellow. He proposes a much longer path that follows a gravity line from A to B. His plan does not require pumps or siphons. He argues that, by understanding the behavior of water, he can gently channel it to point B. He has no need to “motivate” the water. He only needs to understand how it behaves and REMOVE OBSTACLES to the flow.

The designs of both engineers will likely achieve the target outcome (RFP specs) in the short run but, keeping in mind that neither will be perfect,  which theory — to motivate the water or to let water’s inherent behavior do the work — will set in motion the fewest contradictions (problems) in the longer run?

Of course, people are not water. People flow uphill!

Matthew Stewart has written a truth-telling expose in which he explains that the high priests of business management, the MBAs, consultants, and other shamans, have no clothes! In a monumental act of misdirection he, or maybe his editors, choose to title his book, ”The Management Myth: Why the experts keep getting it wrong“. The title of this blog entry would have been more apt.

The Management Myth

Let me begin by saying that this blog entry is not a review of Stewart’s book, mainly because I haven’t read it! But I have read and reread his article in the June 2006 issue of The Atlantic, entitled more succinctly, “The Management Myth“, and if that article, which you can read online, is representative of the book, then I can recommend the book without hesitation. If its book reviews you want, try Jill Lepore’s in the October 12 issue of the New Yorker, “Not so Fast” and Andrew O’Connell’s in the August 13th, 2009 Harvard Business Review, “Why Business Theories are a Waste of Time“.

Now, on to the matters at hand.

Read more…

W. E. Deming was clear in his 14-points that he was adamantly opposed to the use of performance appraisal systems and the use of deferential rewards and punishments given on the basis of goals and targets . But the use of these techniques remains ubiquitous in our business practices despite evidence of the fallacy of these methods that has recently come to public attention in the form of the globally disastrous outcomes produced by bonus systems in the the financial industry. Even Obama has stepped into this trap with his advocacy of pay for performance teacher appraisals.

Why does this approach persist in the face of the evidence that it produces disastrous outcomes and what is the alternative?

Motivation

I think the evidence against the use of performance appraisal and differential motivators is simply invisible to those who are hopelessly mired in  the assumptions promulgated by a theory of organizational and individual psychology. Try as people may, they cannot shake the common sense “logic” that the self-interested will of every individual participating in an organizational enterprise must be bent to the will of the organization by the administration of rewards and punishments, and that it is the principal job of management to do this bending, person by person, appraisal by appraisal.

The assumption behind this view is that we can understand what motivates individuals and act on the basis of that understanding to reliably produce predictable behavioral outcomes among individuals. If you think about this, it is exactly the same logic that an operator uses in controlling a piece of machinery.

In other words, “If” I understand the machine, read the dials, and push the right buttons, it will do pretty much what I want it to do.

Read more…

The September 28th issue of The New Yorker contains an article worthy of note. In “A Life of its Own – Where will synthetic biology lead us?¹“, Michael Specter, a New Yorker staff writer, leads readers along a yellow brick road  assessment of the potential risks and benefits of bioengineering. His description of Frankensteinian science  is fascinating,  but when it comes his analysis of the economics and practical risks of the technology,  I can only say, there are “risks”, and then there are “RISKS!”  ²

New Yorker illustration accompanying article "A Life of its Own", 9/28/09

Specter cuts right to the chase in explaining a reductive world view that dominates much of contemporary science. He implies that developments in decoding DNA can be likened to reverse engineering low level, machine language computer code. Once we have decompiled the code sequence, we can repackage the machine instructions into a higher level, user friendly, programming language, and begin piecing together new genetic variations that can serve our every wish and desire.

For those uncomfortable with computer language analogy, he offers up the idea of Lego blocks that can assembled in myriad ways to create new life forms. This digital imagery — blocks of code and Lego blocks — entails a problematic view of the world that I discussed in my post, “Reductive Hubris“, some months back. The reductive digital analogy of decoding the low-level building blocks of life in order to engineer synthetic life, is worse than fallacious reasoning, it is a dangerously seductive illusion that entails unknown and potentially catastrophic risks. Read more…

I woke up this morning and made my way out the front door to pick up the daily newspaper on my driveway. Near my front gate, an Orb spider was weaving a wonderfully symmetrical web across my path. I stopped for a while to watch it at work. After spinning a run, it would laboriously ascend to a perch on a thread of its own construction and then, in a series of acrobatic drops, sweep a new strand of silk along the arc of its emerging work of functional art. After a few minutes, I grabbed a stick and swept away the web that was blocking my path to the newspaper. The spider dropped, then swung away in the breeze. I proceeded along my way, confident in the knowledge that the spider would begin building its web anew, and hopeful that it would choose a new location that would no longer block my path to news of the day.

"Oh what a tangled web we weave." (Click to visit site with web construction video)

What causes the spider to weave its webs? Does it require some special motivation? Does the spider anticipate some future gain? Does it weave its web out of some fear of future dangers? These questions are silly. The spider weaves webs because spiders and their web-weaving physiology and behavior have come into being over the eons through a process of natural selection. Spiders weave webs because their webs have worked over the ages of spiders becoming spiders.

I have described human beings as first and foremost, enterprising creatures who swim upstream against the tides of entropy with aims and intentions that can be powerfully harnessed using aiming and the definition of mission. Our enterprising nature is why we weave our webs, not out of spider silk, but out of symbols that become woven into an ever-emerging web of knowledge. To be human is to laboriously expend energy to ascend from the unpredictable chaos of the world toward a more predictable, orderly, and valuable world of our own creation.

Read more…

On this blog I have devoted a great deal of time to the abstraction of theory. In my “Methods of Enterprise” posts, I will be departing from this indulgence and in order to offer some specific methodologies for improving an enterprise.

There are many specific methods that an enterprising organization can use to improve the efficacy of their efforts. Fans of Dr. W. E. Deming often have favorites. Some people focus on the use of statistical methods and control charts. Others want to displace performance evaluations and incentives. And still others look to employ Lean methods to improve the efficiency of processes.

The problem that is typically encountered comes from the fact that none of these methods can stand alone. Instead, they must be employed as part and parcel of and overall strategy that is based in comprehensive theory of enterprise.¹

Nevertheless, in a discussion of methods, we have to start somewhere and I can think of no better place to begin than with the methodology of “aiming”. I will try to keep this discussion of aiming in the context of an overall theory of enterprise.

Deming and Aiming

The importance of aiming has been consistently misunderstood, and is often skipped by enterprise leadership because it is seen as being too fluffy, too imprecise, and not directly related to the “bottom line”. But Dr. W. E. Deming regarded aiming as a method of the utmost importance, placing it in the prominent position of Point 1 in his famous “14 Points“.

Deming also said, “A system has an aim” and it is by way of aiming the system that an enterprise can realize what he called a “constancy of purpose” that is the essential component of “continuous improvement”

In other words, if you are going to create and drive a system of enterprise, you must assert the aims of that system or you will not be able to create the constancy of purpose necessary to improve continuously.

So let’s be clear. In Dr. W. E. Deming’s view, aiming was neither trivial nor optional.

Below I explain the concept of aiming in the context of a theory by which enterprising organizations innovate and improve by creating new knowledge. Then I give an example of how U.S. automakers failed because they did not understand the process of aiming.

Read more…

As I watch developments in the battle over healthcare in America, those against taking action argue to the effect that the overall aim of the purposed initiative is well and good, but that the devil is in the details. Dr. W. E. Deming, the masterful theoretician of human enterprise, understood full well that this bit of common sense is nothing more than  common nonsense. This is why the first of his famous 14-points states that leadership must act with (and instill in followers) what he called, “constancy of purpose”.

We must not be deterred from action in which we intend to do that which we have determined to be good, useful, and wise. We are limited in our ability to predict and we cannot perfect the details before the fact or before the act.  As the King in Wonderland advised Alice, we must “Begin at the beginning”.

The ruse used by those unwilling to pursue change, whatever it might be, is to plunge everyone into an imponderable complexity of detail that produces a paralysis of analysis. In this manner, purpose is ground down under the heel of an infinitely long list of “what ifs” and all is lost.

Alice at the mad tea oarty

The devil is not in the details, but the mad tea party of imponderable details is hosted by the devil who seeks to mire us in inaction so that we will remain firmly in his embrace. If we resolve to wrench ourselves from him, we need only agree on what needs to be done and set forth to do it. The details can only be understood and surmounted as we move forward. It’s really quite simple. “Just begin at the beginning”.

Dr. Deming called this process PDSA.

I have just finished reading a facinating and in my view, important article on how the brain works. David Robson, in his article in New Scientist, “Disorderly genius: How chaos drives the brain”, discusses recent research that confirms the theory that the brain is driven by a dynamic tension between stability and orderliness and instability and disorder.

New Scientist¹ includes includes an accompanying video clip that in my opinion, is best view after reading the full text of the article.

In a broad sense, the research findings represent an explanation of the properties of emergence that can be applied as an explanatory framework for change process in many types of systems. It is particularly powerful in describing the way in which knowledge is created.

In the section of my blog called “About Three Sigma Systems” I explain this and offer the following illustration of the process.

Catch the Wave

The wave in this illustration represents the ever-moving present in which we experience, do,  and observe. Deming’s PDSA is illustrated in a dialectal form that represents our continuous efforts at interpreting the world in an orderly fashion. The dynamic tension between our experience of disorderliness and our construction of orderly explanations (theory) drives the process of knowledge creation forward in the same manner as that described in David Robson’s article.

The process is one in which successive tipping points are reached as each theoretical construction succumbs to the evidence of our “Doing”. With each collapse, small and big, we act to realign experience with theory—to restore order. In this way, knowledge is never repeated, it is only created.

C. I. Lewis, Walter Shewhart, and W. E. Deming were onto this idea of knowledge creation. Dr. Deming referred to it as “continuous improvement”. By understanding this process, it is possible for an enterprise to organize itself to operate closer to the fine line between order and chaos. This is the competitive edge of knowledge creation. In his article, Robson rightly explains this as the process by which “genius” as realized. In Deming’s “continuous improvement”, the genius of the group is realized.

One of my most popular workshops illustrates in very concrete terms, just how the process of walking the line between order and chaos makes things happen and I have been meaning to post it here. I will do so as soon as I can get the content formatted for the Web, so keep an eye-out for it.

===============

The concept of evolution is often misapplied in discussions of social change. This is an obstacle to understanding and improvement. Although the process of evolutionary emergence articulated by Charles Darwin is continuous and ongoing, it is best understood as a “weak force” for change in the human circumstance. The “strong force” that propels change in human affairs is the interplay of socially constructed ideas about how the world works and how we can work our will upon the world.

Evolution refers to a process of random genetic variation, in which some genetically shaped phenotypes are “selected” in the context of a given environment. The characteristics that are “selected for” by an organism’s environmental circumstance, derive from a genetic pool of others who also vary, but in ways that are not quite as useful in terms of survival to reproductive maturity.The cornerstone of Darwin’s theory is that the process of evolution is devoid of intention.

When we seek an explanation for the emergence of the Homo sapiens as a phenotype, we are right to employ Darwin’s theory of natural selection. *Interestingly, I am currently reading a rather technical book entitled “The Superorganism”, in which the author’s put forth a Darwin-based explanation for the selection of altruistic genes over selfish genes in eusocial insects.) Although we should begin our explanation of the emergence of humans in terms of natural selection, the power of that explanatory framework for understanding socio-cultural change diminishes once humans have emerged as intentional beings. Darwin actually points the way in this regard in the first chapter of Origins, “Variation Under Domestication”, in which selection of animal phenotypes is determined by intentional human actors. In this case, randomness remains the engine of variation, but human intentionality becomes the selector. This might be called “unnatural selection”. Unnatural selection of phenotypes is ubiquitous in human affairs, and no more so than in the case of the selection of humans themselves. The selection criteria employed by intentional humans are culturally determined.

Understanding unnatural selection is useful, but even this understanding is insufficient for understanding the nature of change in human affairs. The most powerful change process at work in human society is the dialectical interplay of the ideas that shape our relations, our predictions, and our actions. This is the self-created symbolic world that uniquely defines what it is to be human. All to briefly, our consciousness emerges as a communal narrative which is generated in human interaction. The narrative must be communal because shared theory of the world is a necessary precondition for communication. But the communal narrative, like DNA, is never replicated exactly the same in every human actor. Each individual’s theory-based narrative (a predictive construction) varies on the basis of their individual experience as an actor in the world. In other words, we share the same symbolic/theoretical universe but we never share the exact same experience of that universe. We share a conception of the world but we are diverse in that conception. We vary.

As we act as predictive creatures in a theory-based reality, the efficacy of our actions is never perfect. As groups and as individuals, we observe that some of our ideas work better than others. It is the interplay of ideas, action, and observation that drives a conflictual/competitive process of knowledge creation in which anomalous outcomes force the revision of some ideas and overthrow of others. What is uniquely human is that we need not wait for random genetic variation to deliver solutions. Our collaborative intentionality drives a process of knowledge creation. (Interestingly, this interactive model of knowledge creation is mirrored in W. E. Deming’s PDSA, which is simply a rigorous application of the knowledge creating process.)

It should be clear that the process I describe above is idealized. Genetic evolution is messy and so too, is the dialectal process by which knowledge is created. The principle differences are:

— Evolution is driven by randomness and non-intentionality. The emergence of new characteristics in organisms is not a process of improvement but rather, an expression of what happens to work in a given time and place.

— Social change is driven by intentional actors who make theory based predictions., act on those predictions, and upon observing the efficacy of those actions, redefine, renew, and recreate their theory-based conception of reality.

The social change dynamic I describe here in idealized form, provides an answer to the question of WHY conscious social action was selected for in the process of evolution. As with all species, the process of selection is inherently inefficient. It produces very odd creatures who behave in very odd ways. The selection of social consciousness is part of a whole creature in which reside many paradoxes and contradictions. The contradictions produced by the reductive mind are emerging as particularly important in our time. Systems thinking represents one way of addressing the problems produced by the reductive mind. It is a product of the contradictions of reductionism that have arisen in our unique technological age in which the untempered technological power produced by our reduction threatens our survival as a species.

It’s true that most kings are hardened in their ways and unwilling to change, though I have met a few… very few…who were genuinely good kings—wise, willing, and filled with caring.

Individual traits, inculcated, acquired, and habituated over the course of a person’s lifetime (their psychology) are often barriers to transforming how a person understands the world. Systemic barriers created by the characteristics of our method of enterprise will ALWAYS confound transformation until we change that system, irrespective of an individual’s understanding and desire for change.

What approaches are available for a teacher/mentor to go about initiating a transformation of people’s understanding of how the world works?

Read more…

W. E. Deming used to begin his seminars with a commentary on the fallacy of extrinsic motivators. He would ask the question, “Is money a motivator?” then proceeded to answer, “It is not!”

The same applies to all forms of extrinsic motivation.

Dale, a professional educator, wrote:

There is some conflicting research concerning the relationship with rewards and intrinsic motivation. Marzano’s meta-analysis “Classrooms Instruction That Works” concludes that praise and rewards for easy tasks or just completing a tasks may lower intrinsic motivation.
Rewards are most effective when they are contingent on the attainment performance and may enhance intrinsic motivation.

The problem with the research to which Dale refers is that the researcher begins with the all-to-common assumption that individual students are motivated in predictable and useful ways by differential rewards and punishments. The researcher only asks the question; under what circumstances are the rewards and punishments most effective? The researcher begs the question and perpetuates the fallacy that differential rewards and punishments are integral to the successful education of students.

Read more…

I have always been fascinated by Deming’s adoption of an SOPK model — an interactive system which, as a whole, embraces an appreciation of systems, understanding variation, theory of knowledge, and psychology.  His work propelled him toward new ways of seeing and understanding that overflowed the boundaries of traditional academic inquiry. He was not alone in struggling with the underlying contradictions of human knowing. As a young man he stood at ringside, watching the great debates of early 20th century physics during which the very existence of “true facts” was convincingly called into question (Heisenberg Uncertainty, etc.). Of course, Shewhart spoke to this very issue. Einstein went to his grave lamenting the very idea that our ability to know was inherently limited.

Read more…

1.  Create constancy of purpose toward improvement of product and service, with the aim to become competitive and to stay in business, and to provide jobs.

2. Adopt a new philosophy. We are in a new economic age. Western management must awaken to the challenge, must learn their responsibilities, and take on leadership for change.

3. Cease dependence on inspection to achieve quality. Eliminate the need for inspection on a mass basis by building quality into the product in the first place.

4. End the practice of awarding business on the basis of price tag. Instead, minimize total cost. Move toward a single supplier for any one item, based on a long-term relationship of loyalty and trust.

5. Improve constantly and forever the system of production and service, to improve quality and productivity, and thus constantly decrease costs.

6. Institute training on the job.

7. Institute leadership (see point 12). The aim of leadership should be to help people and machines and gadgets to do a better job. Leadership of management is in need of overhaul, as well as leadership of production workers.

8. Drive out fear, so that everyone may work effectively for the company.

9. Break down barriers between departments. People in research, design, sales, and production must work as a team to foresee problems of production in use that may be encountered with the product or services.

10. Eliminate slogans, exhortations, and targets for the work force asking for zero defects and new levels of productivity.

11a. Eliminate work standards (quotas) on the factory floor; substitute leadership.

11b. Eliminate management by objective. Eliminate management by numbers, numerical goals. Substitute leadership.

12a. Remove barriers that rob the hourly worker of his right to pride in workmanship. The responsibility of supervisors must be changed from sheer numbers to quality.

12b. Remove barriers that rob people in management and in engineering of their right to pride of workmanship. This means, inter alia, abolishment of the annual or merit rating and of management by objective, management by the numbers.

13.  Institute a vigorous program of education and self-improvement.

14.  Put everybody in the company to work to accomplish the transformation. The transformation is everybody’s job.