When things aren’t self-evident – Three techniques for managing uncertainty

When things aren’t self-evident – Three techniques for managing uncertainty

We have probably all heard this a one time or another.

“Reports that say that something hasn’t happened are always interesting to me, because as we know, there are known knowns; there are things we know that we know. There are known unknowns; that is to say, there are things that we now know we don’t know. But there are also unknown unknowns – there are things we do not know we don’t know.”
United States Secretary of Defense, Donald Rumsfeld

For anyone who hasn’t, take a look here.

I not a big fan of Donald Rumsfeld, but in this case he is 100% correct.  Known knowns, known unknowns, unknowns unknowns.

The first two represent risk and the third uncertainty. And if you are managing a change effort the absolute last thing you want to encounter is an unknown unknown.

Most people use the terms risk and uncertainty interchangeably but they represent two fundamentally different things.

Risk is a lot more tangible as it refers to situations of which that you are aware. It’s manageable because you can look at the risk objectively, look at the likelihood of it occurring, look at the consequences if the risk actually occurs and then decide what mitigations or controls need to be put into place to manage the risk. This works pretty well, even though most people really don’t have a good way to predict either the likelihood or the consequences. Calculating probability is not necessarily as simple as it looks (but that’s a subject for a future post).

Uncertainty is a different matter altogether.  Because it’s an unknown unknown it can’t be predicted; in essence it’s a surprise. It’s a ‘black swan’ event. The term black swan has been around since Roman times but has been redefined by Nassim Nicholas Taleb (in the book of the same name) as an event that:

  • Is unpredictable
  • Has major consequences
  • In hindsight, appears as if it should have been predicted.

Think 9/11. Or the 2008 subprime crisis or the ensuing financial meltdown. Or the 2011 Tōhoku earthquake and tsunami in Japan. Black swans occur in your personal life as well. You get called into your manager’s office and are told your position is eliminated. Your spouse packs up and leaves. Your doctor looks at your test results and you hear the word ‘cancer’. Or, on a much more positive note, you look at your lotto ticket and you realize that you are a millionaire.

The very nature of a black swan event makes it impervious to traditional risk management approaches. So how do you protect your change effort from the consequences of a black swan?

You have to make your change effort robust so it is both flexible and responsive to unexpected change. I can suggest two strategies and one technique.

Get the right people on your team

Having the right people on your team can take you a long way towards reducing the longevity and the severity of an unexpected crisis.  If I am managing a change initiative I want people on the team with ‘guts’ – or as Hemingway described it – ‘grace under pressure’. You need people who will remain objective and clear-headed when they are under pressure; people who can be both patient and decisive, waiting until the time is right to act and then acting with authority. One of the challenges with this approach is that you really don’t know how an individual will react to pressure until you actually see them under pressure. But when you find them keep them for they are more precious than gold.

There is a prerequisite that need to be in place for this to work. People need to be able to speak their minds. In a lot of organizations the opposite is true. Positive feedback is encouraged but anything else is strongly discouraged; any feedback that isn’t positive is perceived as a challenge to the authority of the leadership. It’s a shame, because organizations and leaders are missing out if they are deaf to the informed opinions of their people. (Notice that I’m only referring to ‘informed opinion’. Everybody has opinions but that doesn’t mean they are all worth listening to.) Being willing to listen requires strong leadership; most people don’t like hearing that their baby is ugly (even just a tiny bit) and leaders are no exception. Hearing positive feedback is easy; negative feedback not so much. It requires a degree of objectivity and detachment that many leaders find difficult to achieve.

Leaders should make the effort. The establishment of a work environment that encourages individuals to speak their minds (maybe ‘encourages’ isn’t a strong enough word – ‘rewards’ would be better) is a huge asset for an organization. Subjecting proposals for change to scrutiny by in-house (and external, if necessary) subject matter experts raises issues and concerns sooner, which leads to them being resolved earlier.  It could also result in the change initiative being postponed or terminated. The earlier work stops on a bad idea the better it is for an organization.

Build contingency into your timeline and budget

When you are constructing your timeline for the change effort do not take a blue sky view. Too many change initiatives are scuttled because the leadership assumes nothing will go wrong and when it does they have neither the time nor the money to deal with the issue in the appropriate manner. Make the opposite assumption instead; assume that there will be issues and plan build additional time and money into your plan. The amount of the contingency needs to be based on the degree of familiarity with the space where your change management is operating.  For example, suppose you are developing a simple life insurance product for a company, but it’s something that is done regularly and there is a clear methodology to follow. The amount of contingency will be less (probably much less) than if the development is for a complex product being developed for the first time.

Hold a pre-mortem

The idea of a pre-mortem is simple but it is a powerful technique.

  • Get your team and stakeholders together, give them all a pen and some paper.
  • Set this scenario – it’s a year after the end of the change initiative. It failed, and it failed badly. Think of the Hindenburg – this was worse. Because of the failure friends are no longer friends, people have lost their jobs and careers have been ruined.
  • Ask them to answer this question: What happened? What were the reasons that it failed?
  • Have each of them list the reasons for the failure.
  • When everyone is finished, have them share their lists, one reason at a time until all the reasons are captured.
  • Following the meeting, consider each of the reasons. Some of the reasons will be risk management concerns and can be managed by that process.  The remainder are items of concern that you need to consider and that should be taken into account when determining how much contingency is required.

Essentially you are trying to make the future a little bit less unknown by leveraging the knowledge and expertise of your team to envision problem scenarios and to consider the best way to respond to these scenarios in advance of them occurring.

(The concept of a pre-mortem was developed by Gary Klein and is described in his book The Power of Intuition.)

Uncertainty is daunting, but it’s a fact of life; we need to learn how to manage it better. I’ve given some suggestions on how to do just that – please feel free to share your approaches and techniques. If nothing else, it’s good to think like a Boy Scout – ‘Be Prepared’.

photo credit: LaPrimaDonna via photopin cc

We hold these truths to be self-evident, part 2. Three self-evident truths you must consider before implementing change.

We hold these truths to be self-evident, part 2. Three self-evident truths you must consider before implementing change.

My previous post was about the Declaration of Independence and how it’s a compelling example of a change manifesto. I can’t stop thinking about the phase ‘we hold these truths to be self-evident’. It has been tumbling through my brain incessantly, and the more I think about it the more I am awestruck.  The word ‘self-evident’ is absolute genius. (Fun fact: the original draft used the terms ‘sacred and undeniable’.)

Self-evident is a wondrous term. The word ‘evident’ is from the latin ‘evidens’; it means ‘obvious to the eye or mind’. The Founding Fathers are basically saying, “Don’t even think of arguing about this because it’s as obvious as the nose on your face. Don’t waste our time.”

And then this got me thinking – are there truths that I hold to be self-evident?

Surprisingly, there aren’t that many. I’m not typically a ‘black/white’ kind of guy; I’m more a ‘shades of grey’ person. (I know what you are thinking and you can stop right now. I can see far more than just fifty.)

But I do hold a few self-evident truths. From the perspective of change management, there are three.

I hold these truths to be self-evident: That you know less than you think you know, that you have less control over things than you think you do, and that there are no silver bullets.

You know less than you think you know

One of the challenges that you have is that while you possess a certain depth and breadth of experience (and it may be considerable) as well as a body of knowledge that spans many areas (which also may be considerable), you also have a set of biases, preconceived notions and beliefs (which are definitely considerable).  It is these beliefs that cause you dismiss or to not even consider options that lie outside your experience. This behavior is called confirmation bias. When confirmation bias takes hold you start to only see facts that support your preconceived notions and tend to dismiss objections and exceptions as irrelevant or immaterial. You also start to underestimate the difficulty of the task at hand because you are focusing on the desired outcome rather than likely outcome.

How should you combat this?  How do you counteract your own tendency towards ‘blue sky’ thinking? I have a few suggestions. Research initiatives that are similar in nature and learn from their success, and more importantly, their failures. Engage some individuals with relevant experience to review your plans. Get someone who you trust to act as a devil’s advocate and work on developing clear, objective arguments against the approach you are taking and then make sure you can counter the arguments. When exceptions arise don’t dismiss them out of hand, ask why they occurred and make sure that you get real answers. Invest some time in searching for evidence that contradicts your assumptions.

You have less control over things than you think you do

There are a number of things that you can control. You can control your behavior. If you are in a position of authority to some degree you can control the behavior of others. You can control how time is allocated. This is good news if you are an operations manager or a project manager because controlling the tasks performed by the individuals who report to you is critical to getting work done. But there is bad news as well; there is a multitude of things you can’t control; these things are not normally considered in your decision making process because you are operating under the illusion of control. You can’t control the weather. Or when someone falls ill.  Or wins the lottery. Or gets hit by a bus. Or when they have an argument with their spouse and spend the whole day wondering why they got married in the first place. Or when a server blows up or an assembly line fails. Or when a critical supplier or customer unexpectedly goes out of business. The list goes on and on. The universe of things that you can’t control is vastly larger than the one where you have control.

Planning for foreseeable issues is risk management.  The real challenge arises when you need to plan for unforeseeable risks – for uncertainty. For this there are no easy answers. Build contingency into schedules. Hire competent people and make sure you keep them engaged. Model and simulate the end state and see where the breakdown and bottlenecks occur. Establish metrics and monitor them, and don’t ignore the exception cases. And when an uncertain event occurs, be prepared to react quickly and decisively.

There are no silver bullets

Human beings like easy. Easy is good, it’s understandable and it doesn’t require a lot of effort on anyone’s part. Need proof? Watch late night TV for a little while and you will see exercise machines that will remake you in just 20 minutes a day; diet regimens that cause the pounds to just melt away; a countertop oven that can cook your entire Sunday dinner in less than an hour. Plus you can find love – just dial this phone number now, operators are standing by!

The software industry is rife with companies that promote their software as the be all and end all. Just buy Acme WhizBang! Version 1.0 and watch your productivity skyrocket! Guaranteed improvements of up to 200%! Installs in less than a day! Up and running in a week! Except … except it’s just in beta testing, it’s never been integrated into an environment like yours, the training material isn’t complete and our company is bleeding money and is trying to sell itself to Google or Oracle or to anyone who’s buying. But please don’t delay – this software is all you need!

Don’t be fooled. Successful change requires clearheaded thought and significant effort – anyone who tells you otherwise is misleading you.

But what do you think?  Am I too pessimistic? Or maybe too pessimistic? Are there self-evident truths that I should have included? Feel free to comment!

We hold these truths to be self-evident – Five lessons in  change from a birth of a nation

We hold these truths to be self-evident – Five lessons in change from a birth of a nation

How do you kick off a change initiative? What can you do to start the effort off on the right foot? It’s said that you never get a second chance to make a first impression; in the case of organizational change creating a positive first impression is the first critical step in the road to success.

A popular approach (and a sound one in my opinion) is to create a ‘change manifesto’ – a document that articulates your vision and your expectations of the change in a clear and concise manner.

There’s a very good example of such a document – it’s in Washington D.C.

I recently had the good fortune to spend a few days there. One of the benefits of visiting in the dead of winter was the lack of tourists; I was able to walk into attractions that usually have wait times of 60 to 90 minutes. (One of the downsides is that it was absolutely stinking cold!).

One of the places that I made sure I visited was the National Archives. (I was relieved to find that Nicolas Cage was not in attendance). The history of America (and for that matter, the world) has been irreversibly changed by the documents stored there and the ideas that they contain. The documents on display include the Magna Carta, the Constitution of the United States, the Bill of Rights and the Declaration of Independence.

In the Declaration of Independence, just after a brief opening paragraph, we read the following:

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness…”

Putting the political and patriotic overtones aside for a minute and looking at the document objectively it’s pretty clear that the Declaration of Independence is a manifesto for change. It contains a vision, a brief description of the current state, an inventory of their problems and finally a broadly stated action plan (as well as the signatures of everyone who were accountable for ensuring the final outcome).

What I find absolutely extraordinary is the immense distance between the current state and the vision.  The phrases “all men are created equal” and “life, liberty and the pursuit of happiness’ were especially problematic. Equality and freedom were not available to all citizens. The American economy was completely and totally dependent on slavery; the majority of the signees were actually slaveholders. There were no clear answers to very basic questions, such as “Are slaves really men?” and “Does the word ‘men’ include women?”

This was a big problem but there were bigger ones.

If the Founding Fathers had hoped for unanimity around the idea of independence they would be disappointed; a large segment of the population remained loyal to the British Crown. And the British weren’t going to stand by while their most profitable colony seceded; the Revolutionary War had already started and the survival of the fledgling state was the first and foremost priority. The rest could wait.

It was a long wait. From the legislative point of view, transforming itself from a British Colony to the modern independent state that America has become took about 150 years. Slavery wasn’t abolished until the 14th Amendment was passed in 1868. African-Americans received the vote in 1870; women in 1920. And let’s not forget that transformation required both a revolutionary war and a devastating civil war (where an estimated three quarters of a million people lost their lives).

I think that you can make a pretty persuasive argument that the transformation continues to be a work in progress; that America is continuing to refine and evolve itself based on the parameters of a document that was authored almost 250 years ago.

Is this not compelling? This transformation was started with publication of a few powerful concepts articulated in a simple document of less than 1500 words. And by the fierce resolution of men and woman that believed in those concepts and were willing to work towards bringing those concepts to life and making them a reality.

Organizations should learn from this.

What lessons?

A change manifesto talks about what, not about how

Successful change needs to rest on a strong foundation, but that foundation doesn’t necessarily need to be defined to the nth degree. The purpose of a manifesto is to publicly state the intentions of the issuers. It’s a vision, it’s a call to action – it’s not a project charter or a project plan. And it should be succinct. It doesn’t have to be 435 PowerPoint slides spread across half a dozen presentations.  Clear. Concise. Brevity is good.

It should generate excitement

The vision should be compelling. It needs to pluck the heartstrings and enflame passions. The realization of the vision will require a lot of people to do a lot of a work; it won’t be achieved unless everyone is engaged. It’s a challenge but it’s also an opportunity and it needs to be presented in a way that stirs the imagination. You are presenting a possible future that is significantly better than your present situation. If your raison d’etre for the change is “We anticipate that this adjustment to our strategic vision will ultimately result in the overall reduction of operational costs by up to 17% over the next five years” I think you have some work to do.  Why would anyone about sign up for that? Make it captivating.

It has an immediate impact

The change manifesto needs to have an immediate impact. You need to demonstrate in the most explicit that you are serious. It can’t be trivial. It needs to be real – something that makes the environment feel fundamentally different than it did the day before. (Just an aside: I don’t like the idea of using an organizational restructure as the initial step. It’s my personal experience as someone who has lived through countless reorganizations that reorganizations have marginal impact on the average employee. The reporting structure changes but the work remains the same.) It needs to be a fundamental change in policy or structure with an impact that is readily apparent to everyone. It can’t be, “We have struck a subcommittee whose mandate will be to investigate and recommend possible avenues for the initial implementations.”

You need to rally the troops

The rank and file must have faith in the judgment of their leadership. Copies of the Declaration of Independence were widely distributed and used to inspire the troops and the entire populace, and the readers knew that the document was written by a group of delegates who had the backing of their respective states and were acting in what they believed was the best interest of the people and of the nation. Business leaders don’t typically have this luxury. You are acting in the best interest of company but not necessarily in the best interest of all of the employees. It is quite likely that the greatest impact of the change will fall on them. You need to make sure that you have a plan to win the hearts and minds of your staff as they are vital to its success. (In my opinion this is the most difficult aspect of change but it is vital to its success.)

The change will take longer than you expect

Be prepared for the change to take time (but hopefully not 150 years). It will absolutely positively take longer than you think it will take.  It’s easy to end up overpromising and underdelivering and it’s the fastest way to lose both your credibility and the credibility of the change initiative. What a good rule of thumb? Take your estimates for cost and duration and double (or triple) them.

I’m pretty sure that the Founding Fathers didn’t get any consulting help before they created the Declaration of Independence. (Cynics amongst us might suggest that’s why they were successful!) But successful they were and we should learn from that. History is full of tremendous successes and abject failures, all of which present us with an opportunity to learn.

Interested in the Declaration of Independence?  See the text here.









What’s in a Name?

What’s in a Name?

The first question I’m usually asked is about the name of my business.  It normally goes something like this: “Spitfire Innovations?  Where did that name come from?”

I normally answer that my son suggested the name and everyone in the family liked it, so it stuck.

And that’s true, but the complete answer is a bit more complex; it’s a two-part answer.

Supermarine Spitfire IXE aircraft of No. 412 (Falcon) Squadron, RCAF, preparing for takeoff in Holland, 22 March 1945

Supermarine Spitfire IXE aircraft of No. 412 (Falcon) Squadron, RCAF, preparing for takeoff in Holland, 22 March 1945

When I was younger I dreamed about flying, and in my dreams the plane I flew was the Spitfire. My parents both served oversees with the Canadian Forces in WWII and I suppose part of their experience resonated within me. Back in the late 1970s (!) when I learned to fly and I was puttering around in Cessna 150s and 172s, somewhere in the back of my mind I was pretending I was in a Spitfire.  (It didn’t help that one of my flight instructors, Marion Orr, was a Spitfire ferry pilot during WWII.  You can read her story here.)  Even when my direction changed and I started down the information technology path the Spitfire stayed with me; a picture of a Spitfire MkV graced the wall of my first cubicle. But while the Spitfire has a place in my heart, what it really represents is what I hope to achieve with this company.

The Spitfire was the most significant airplane produced by Britain during the WWII, and arguably one of the most significant ever. As a piece of technology it had a remarkable lifespan, from its first test flight in 1936 to finally being retired from operational service (from the Syrian Air Force) in 1953. But it was not only long-lived, it was flexible, with over 24 major operational versions being produced as well as countless smaller variations. The fundamental robustness of design of the airframe, particularly its distinctive elliptical wing allowed the design of Spitfire to evolve and improve during the war. Problems were encountered and problems were fixed. Everything about the plane changed; the engine, the armament, even the materials used to construct it.  And as the plane evolved its characteristics changed and its capabilities changed. This flexibility allowed the plane to be used in numerous roles, from a single seat fighter (made famous by its role in the Battle of Britain), to reconnaissance, to ground support as a fighter bomber. Spitfires even flew off aircraft carriers.

The Spitfire epitomizes what I believe is the essence of good design and innovation; a design that can evolve and extend far beyond what was it intended to be and become something better.

This is what Spitfire Innovations will do for its clients – to build a solid foundation that can be scaled, extended and leveraged far into the future. To maximize the investment by delivering value not just for months, but for years and years. By building into the design capability for change.  To exceed expectations.  To go above and beyond.

Wish me luck.

Why a Blog?

Why a Blog?

Why not?

After well over 30 years working in information technology within the financial services sector I have at last decided to strike out on my own. This seems to be a trend among my friends and colleagues who are of the same vintage as me; many have chosen a similar path (or have had that path chosen for them).  My former company and I had some serious philosophical differences over the last few years. It became pretty clear that they weren’t going to change their direction, leaving me the choice of holding my nose and remaining with the company, or striking out on my own (and being able to breathe).

I chose breathing (and I thank my family and friends for helping me through that process – it was harder than it looked).

My intention is to use this blog to provide you, the readers, with the opportunity to think about things a bit differently. And by ‘things’ I really mean ‘how you plan, design and operate your business’. And how you manage change. Where it gets complicated is that many of opportunities that I see are behavioral in nature; sometimes changing your business will mean personal change – changing how you think and how you act.

And change is hard.

I know change is hard because at my former employer I was a part of no less than three major strategic transformational initiatives, as well as a host of acquisitions, divestitures, reorganizations, outsourcing efforts and the like. And in looking back at all that change and how successful (or unsuccessful) those change initiatives were, I can only conclude that, in virtually every case, we could have done better.  Much better in some cases. And some cases the change had no business happening at all.

Virtually all of my learning has been of the ‘hands-on’ type; over the years I have gained considerable amount of experience in managing change and I believe that my judgment is sound.

Here’s a brief account on how one gains judgment –– it dates back to the 17th century and it’s probably apocryphal in nature but it’s a good story nonetheless.

A student sought out Mullah Nasruddin for years, hoping to find guidance from him. He finally found the Mullah in the marketplace sitting atop a pile of banana peels – no one knows why.

“Oh great sage, Nasruddin,” said the student. “I must ask you an important question, whose answer we all seek: What is the secret to attaining happiness?”

Mullah Nasrudin pondered for a time and finally replied, “Good judgment.”

“Ah,” said the student. “But how do we attain good judgment?”

“From experience,” answered Nasruddin.

“Yes,” said the student. “But how do we get experience?”

“Bad judgment.”

(As recounted in THE BEGGAR KING AND THE SECRET OF HAPPINESS by Joel ben Izzy, Algonquin Books, 2003).

I am more or less self-taught. I don’t have a doctorate. Nor do I have an MBA. I am not an academic theorizing.  What I am is both an observer and a practitioner. I’m pragmatic. I’m a bit of a contrarian. I like experimentation. I’m realistic. And I remain absolutely convinced that every organization can implement change that will provide lasting value to the owners, the employees and to the customers. I am also convinced that every organization can improve the process by which they implement change.

How can you improve your business without breaking the bank, without losing your ability to operate effectively and without losing your sanity? And without losing your integrity? These are the questions that my blog will hope to answer.

The primary focus of this blog will be people, process and technology, in that order. I will do my best to stay on topic, but sometimes I may go off on a tangent and there may be the odd time where current events get in the way. I beg for your indulgence in advance; I promise I will do my best to keep these walkabouts to a minimum.

Let me give you my solemn pledge about a couple of things:

  • Your personal information is safe.  I take privacy, confidentiality and security very seriously.  Your contact information will *never* be sold, given away or otherwise distributed.
  • You will never see ads displayed on this site. Ads are crass, and I don’t want it to appear that I am endorsing any of the products or services.
  • I commit to promptly replying to everyone who either comments or sends me a private communication.

My intent is to publish twice a week, probably Mondays and Thursdays. I expect each entry to be between 500 and 1000 words. (I know that you aren’t really too concerned about my publishing schedule or the number of words, but I am, and I need to see it written down to make it real).  And I will make it worth your while to read them. Your time is valuable – it’s a non-renewable resource – I have no desire to waste it.

I hope that you will comment on my entries. It will help me gauge interest in specific topics and inform me where I should probably go into more detail (or conversely, where I should just move on!).  A dialogue is much better than a dissertation and I invite everyone to agree or disagree and to add their own perspective to the conversation.

Ideas are grand, but magic only happens when those ideas are transformed into action. I hope that there are some success stories that can be shared – case studies on successful implementations of change. And I hope that we can have a bit of fun with this.  Fun is something that has been absent from my work life for some time now and it’s high time for a return engagement.

I have a few goals for the blog.  I’d like to see it grow into a community of individuals who are willing to listen to each other, take what they have learned and then apply it.

I am looking at this as an incredible opportunity to share, and to learn, and to grow.  For me, and for us.

Back in 1988, at a UN conference aimed at saving the rainforest, Jerry Garcia (of Grateful Dead fame) said this: Somebody has to do something, and it’s just incredibly pathetic that it has to be us.

I’d like to paraphrase a bit: Somebody has to do something, and it’s just incredibly exciting that it gets to be us.

Welcome to the Spitfire Innovations blog – dedicated to promoting an intelligent approach to planning and implementing change in your business (and maybe in yourself too).

Update Monday April 14th: Now that I have been blogging for a month I’ve come to the conclusion that producing 2 quality posts per week is akin to a full-time job.  I’ve decided that one post a week is going to have to suffice.

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