Why the best questions have to do with what is invisible

looking-for-what-isnt-there.png

Imagine having to ask the CEO of a company about their strategy or a prospective employee about his or her capability.

What they show and tell us will depend on the kind of questions we ask.

How do we know we are asking the right ones? The ones that will throw up opportunities and show us what is really happening?

There are lots of lists of questions we could ask. The important ones are about what is not there – and there are three important versions of these.

What is the unmet need?

The first comes from Jo Miller’s conversation with Ellie Pidot, VP of Strategy at Medtronic who asks What are your customer’s unmet needs?.

One way to think of this is like whitespace on a page.

What is left out helps us make more sense of what is there.

We can ask people what they do and what they want and we will be told a story, probably one that is logical and coherent.

They might tell us what they are doing – and the things identified as needs.

All too often, what they tell us and what they actually need can be different.

This happens quite a lot in IT, for example. There is often a gap between what software developers think people want and what they actually need.

The best programmers are able to bridge that gap and create the right kinds of tools to help us.

What would an outsider do?

The second question comes from Freek Vermeulen who asks what would other, external people do, if they found themselves in charge of this company?

This can be thought of like a blank page.

What would we do if we were starting from scratch? From a zero base – with no sunk costs or investments of time, effort and energy?

Bryan Tracy suggests asking – knowing what I now know, would I do things differently?

Are there things we would do more of, less of, start or stop?

It’s hard looking at the same things through the same eyes.

It might help if we try and look at them through the eyes of someone else, someone we respect. What would they say or do?

Then – do we have the courage to do that ourselves?

What would be least risky?

The third question is from Tim Ferriss’ interview with Joe Gebbia, the co-founder of Airbnb.

Many people think that to get ahead we need to take more risk. Higher risk equals higher returns.

That’s not really the case.

Take B2B sales, for example. Joe points out that B2B customers, given a choice between a low price and low risk, will take the lower risk option.

Entrepreneurs who have taken what seem to be huge risks often have carefully calculated the downside and decided that they can live with the odds.

The Dhandho approach follows this – Heads I win. Tails I don’t lose much.

Often the course of action that people will follow is not the one that gets them the most but the one that looks the safest.

So, in this case, its the absence of obstacles that matters.

Summary

There are more questions that we could ask than ever could be answered.

We need to ask the ones that show what isn’t there.

The whitespace, blank page, absence – that’s where the opportunities are hiding.

The 3 critical processes you must try and improve at your business

three-timelines.png

If we had to make sure that just three processes were working as efficiently as possible in our business, which ones should we choose?

According to David Bovis three timelines developed by Toyota are enough:

  1. How we convert raw material into finished goods
  2. How we go from concept to launch
  3. How we go from order to cash

So, what are we trying to do when improving each of these?

Raw material to finished goods

The whole point of our business is that we add value to something. Whether its taking raw materials and turning out a physical finished product or providing a service that carries out some kind of knowledge work, we still need to work our way from a start point to an end point.

In a world with infinite digital storage space we end up keeping everything. Emails from ten years ago to every bad photo we ever took.

It takes real discipline to stop things piling up – whether in visible piles of stuff or paper or in ever growing digital folders.

So how can we improve this process? There are four things to look at:

  1. Maintain systems before they fail: From manufacturing systems to computer equipment, we need to look after our kit.
  2. Reduce the amount of parts and supplies: Do we need to have ten different types of notebooks in the supply cabinet or buy a year’s work of cleaning supplies?
  3. Keep things in the right place: We often can’t find stuff just because it’s not put back properly.
  4. Put stuff that needs to be thrown away in a set place: When things are ready to go, put them in an agreed place so they can be removed.

Concept to launch

This is an interesting one – especially if it’s taking a new product to market.

We need to create things that customers want more than they want the money in their wallets.

Just building it isn’t enough – it needs to be saleable – exchangeable for real money.

That means we have to work backwards from what customers really need (which isn’t the same as what they say they need) and build products to address their needs.

Everything that doesn’t do that is optional – perhaps even wasteful.

Another consideration – not always taken into account by product developers – is that customers, especially business-to-business ones – will choose an option with less risk over one that has a better price.

If something does what is needed and can be shown to be robust, it can often beat a competitor with more bells and whistles.

Order to cash

The final process to get right is the timeline from order to getting paid.

For many products, or services sold like products, we pay up front and receive the product later.

Service businesses, on the other hand, tend to invoice after the work is done.

Improving an order to cash process means looking all businesses, whether product or service, as product businesses where all or some of the payment is made earlier in the process.

Summary

For all three timelines, we’re trying to keep only what is needed – remove everything that adds waste and keep the things that add value.

It’s how we do that which matters.

How to set out a persuasive argument

minto-pyramid-principle.png

Consultants at the international strategy firm McKinsey are famous for their ability to take huge amounts of information and come up with clear and focused strategies for their clients.

That’s not something that we see all the time – how many meetings have we sat through that seem to have no point, presentations that meander all over the place and discussion or recommendation papers that are impossible to understand.

Is there a way to cut through all the noise and present information in a way that helps listeners understand their options and make decisions quickly?

Yes there is – and it’s called the Pyramid Principle.

Barbara Minto, the author of The Pyramid Principle: Logic in Writing and Thinking, came up with the principles in her book while working at McKinsey – and then implemented them in training programmes at the firm.

Her insight was to see that the order in which we present ideas is critical.

When we’re solving a problem, we need to start from the beginning and work through to the solution at the end.

When presenting a recommendation, however, we start with the solution and then expand on why we believe that is the right thing to do.

Why do it this way? Well, because people are busy and dying to get to the point.

If we can explain something more clearly with less information they can make decisions more quickly.

The Pyramid approach has three parts to it:

  1. Tell the audience a story leading to a key question – which we answer up front.
  2. We then set out the key reasons why we believe the answer is the right one.
  3. We put forward facts and evidence to support our beliefs.

In most cases requiring a solution, we start with a situation where there is a complication – something isn’t working the way it should.

Our starting point is to ask a question – how can we make things better?

The story we tell describes the situation and complication, poses the question and then presents the answer – up front.

The audience knows in the first few moments of engaging with us or our material what they are going to get from us.

So then we set out the key themes – essentially answering why we believe our answer is the right one.

Three themes is a common approach – but it could be more if all of them are mutually exclusive and completely exhaustive – the so called MECE approach. More than seven, however, will usually confuse things.

Then, for each theme, we set out more facts and evidence to support our position.

By following the pyramid principle, we are going to connect far more quickly with the people we are trying to persuade and get across the decision we want them to make and the reasons and evidence that supports why they should make that decision.

And that is much more persuasive than a rambling discussion that sends everyone to sleep.

How to do more of what matters and less of what doesn’t

value-to-waste-ratio.png

Taiichi Ohno, the man behind the Toyota Production System, believed that only a quarter of the work done adds value for the customer.

There are two linked words there – value and customer.

Some things that add value are seen by the customer – better service, making it cheaper and more simple.

Other things are not – improved safety, better screws, brighter tail lights.

What takes the other three-quarters of time?

Another quarter is incidental work, stuff loosely associated with the main value adding activities.

The rest is waste.

With physical systems – like making cars – we can focus on waste because it’s visible.

If there is excess stuff, it piles up. At home, if we’re buying the kids too many toys that’s clearly visible.

So we can focus on removing and eliminating waste wherever we can see it.

That’s easier said than done, especially when we need to get rid of stuff we already have.

But we can try and create rules and habits that mean less new waste is created.

In knowledge work, that waste comes in the form of emails and meetings and requests for long reports.

In this paper by Matthew May, he argues that because we can’t easily see waste piling up in knowledge work we need to focus instead on what work adds value.

That means working on our own lists of jobs before looking at our emails and responding to other people’s priorities.

It means avoiding all meetings.

It also means picking up the phone sometimes instead of sending out emails.

But that doesn’t really get to the point of it all.

The point is that there is a ratio between doing things that add value and everything else.

We’re trying to maximise that value to waste ratio – cut down the waste and increase the value.

At the same time, the size of the whole work package also needs to shrink.

It doesn’t make sense to do more. A lot of the time it actually makes a lot of sense to do less, to have less, to need less.

An attitude of removing, however, focuses our attention on the rubbish around us.

Which means we might miss the good stuff.

We should instead develop the ability to work on things that add value – and incidentally get rid of everything else.

How simple rules can help us become better at everything

simple-rules.png

Complex situations need equally complex solutions. Or do they?

This is the question explored in Simple Rules, a book by Donald Sull and Kathleen Eisenhardt.

Let’s be honest – how many times do we make something look really complicated so that we can come across as knowing more than everyone else or justify the fee we are charging.

But really, in many many areas, just using simple rules will give better results than complex ones.

So, what are simple rules and how can they help us?

Sull and Eisenhardt split simple rules into those that help us become more effective and those that help us become more effective.

Becoming Effective

Becoming more effective is squeezing more out of the time we have and that means saying yes to some things and no to others.

We can do these in three ways.

Boundary rules

First there are boundary rules. These are binary decisions of the yes/no variety.

What should we do and what shouldn’t we?

For example, when revising for exams for my first degree, I had two very simple rules.

I never worked after 12 in the afternoon and on weekends.

Working from 9 – 12 for four weeks before the exams was more than enough time to revise and prepare for them.

Prioritisation rules

The next kind of decisions revolve around what to do first.

The classic example of this is how medics triage patients during an accident.

Everyone is tagged based on the severity of their condition and how urgent it is that they are seen.

I remember being in an aircraft accident simulation as one of the volunteers to train the response teams where we were all labelled with the injuries we had supposedly sustained.

I had a broken foot and so was transported slowly by ambulance while enviously thinking of the helicopter ride being taken by the person with far more serious injuries.

Prioritisation can be a double edged sword, however, leading to unnecessary escalation and messing about unless the rules are clear and applied consistently.

Stopping rules

The last kind of effectiveness rule has to do with when to stop.

Enough needs to be enough. Cultures that have a rule that people should stop eating just before they are full have much lower obesity levels than others that stop eating when they are full.

Perfectionists sometimes don’t know when to stop. In most cases, it’s good to stop early – and that leaves us with the capacity to go longer on the things that matter.

Becoming Efficient

Where effective is about doing the right things, being efficient is about doing things right – and once again there are three types of rules.

How-to rules

How-to rules set out a pathway, a series of steps to follow.

The best example of this is the idea of mise-en-place – laying out everything that is needed and following an efficient sequence of operations to cook.

One thing I learned here was to put the pan on the fire before starting to get ingredients out. By the time I had everything, the pan was hot and I could get on with cooking.

Coordination rules

Coordination rules are about playing nicely with others – working as a team.

A nice example is when to use the words you and we.

When we talk to someone else and need to talk about a negative situation, say the person did something wrong, how should we phrase the sentence?

Is it You made a mistake or We made a mistake.

Using you will immediately result in the listener getting defensive and upset. With we, there is a recognition of collective ownership and a more likely move towards thinking of ways to stop the problem happening again.

Timing rules

The last set of rules are about timing – when to do things.

For example, many productive people believe that we should the things that are most important to us first thing in the morning.

When I started writing this blog, I did just that – the first thing I did every day was to write. And having that rule made it much easier to do the work needed

Many activities have cadences – a sequence that needs to be followed to get results. Getting the timing right on these is crucial.

Summary

Simple Rules is an easy-to-read book that sets out a clear map of what simple rules look like and how to come up with them.

So here is a simple rule – Read the book.

The three ways in which we think about systems

how-we-look-at-systems.png

Professor Peter Checkland has written a number of books about systems, and in 1981 published Systems Thinking, Systems Practice.

As one of the commentators on Amazon writes, the book elegantly describes the history of thought that led from early Greek logic displacing the religious and faith based approaches through to stunningly successful scientific reductionism and then to systems thinking.

The modern world is so much a result of reductive thinking – of breaking things into parts and understanding how they work – that we sometimes think that’s the only way to look at things.

The systems approach captures the idea of emergence – the fact that some things cannot be explained just by looking at its components – the idea that the whole is more – is something other – than the sum of its parts.

Many of us want to know the detail – how did something happen – what did someone else do, so that we can replicate or copy those tactics and apply them in our own lives and situations.

This works sometimes, and doesn’t at other times. Human beings and the way we function cannot be reduced to formulas.

If anything, human societies are constantly changing how we act in response to what we learn about what happens when we act the way we do.

So, when it comes to systems, Checkland suggests that there are three ways we tend to approach them.

First, a system could be looked at as a black box – with inputs, outputs and feedback. We look at what comes out of the box and adjust the inputs to get what we want.

This approach is mechanistic and assumes that the same input will always give the same output all else being equal.

Which it rarely is.

A stable system, however, that operates within a reasonable range, will give a set of outputs that are more or less regular, and we could use statistical methods to then figure out what might come out of the system.

Other people want to look inside the system, to figure out how it works.

That’s another approach – more reductionist – as we look at the workings of the system in detail and see what happens.

It’s like dissection – we can keep going through organs, cells, all the way down to atoms.

So, given that we can look at systems from the outside, or try to look inside them, Checkland writes that we tend to adopt three approaches.

The natural historian looks at the system and describes it. This is like an academic’s approach to social studies – we have no interest in changing what is there but we do want to try and capture what is happening.

A manager tries to organise things so that the system works well. This involves moving bits around and trying different approaches.

A designer tries to come up with a new system or modify an existing system so it does something better or differently.

All three look at the same system, but from different points of view. And this means that they have to work hard to understand what the other is doing.

A designer wants to change things around, and could be impatient with a manager that wants to do the most with what is there.

And the natural historian doesn’t want things to change, but does want to know what is going on.

The point is that we need all three – we can’t manage what we can’t describe, and we can’t design something when we don’t understand what we are trying to achieve.

Just like the starting point, trying to break things down into roles and pieces just doesn’t help when we’re trying to understand the entirety of something.

We’re trying to get at the whole thing – and that is what it means to take a holistic approach.

Why don’t more small businesses invest in information systems?

small-businesses-and-information-systems.png

Are the businesses around us as effective as they could be at using technology to improve how they do things – from serving customers to keeping costs low?

As we move into an increasingly digitized economy, what kinds of organisations are likely to take advantage of the new opportunities that emerge?

A paper from 1999 by James Y.L Thong may still have useful lessons for us nearly twenty years later.

The core systems that businesses require are more or less understood. Almost every business is probably going to have email, some kind of office software and a website.

But what happens after that… what about customer relationship management (CRM) systems, specialist analytics tools, marketing software and so on?

Thong’s paper argues that there are three key characteristics shown by businesses that adopt information systems (IS).

First, CEO’s matter a lot.

CEO’s that are innovative and open to trying new things are much more likely to put their weight behind an IS initiative than more conservative ones.

The amount of control held by CEOs over decisions in small firms means their approach is critical in making something happen or not.

In addition, their approach will also be influenced by how much they personally know and understand the technology being considered.

Someone who is unfamiliar with computers and suspicious of technology may be unwilling to engage and understand what is possible with modern systems.

This is not an age related thing – many older CEOs and Chairman have reached their positions by being ahead of the technology curve at every stage of their careers.

It’s an attitude thing instead.

Second – the innovation matters

People will only think about adopting something new when the benefits of doing so are clear.

We tend to use at least three rules of thumb to evaluate technological options.

  1. Is it better than what we have now – does it have relative advantage?
  2. Is it compatible with how we work now?
  3. Is it easy to use – or at least no more complex than how we do things now.

If an innovation passes these three tests, then there is a good chance we’ll consider it further.

The main thing is whether the organisation is at the right point in its lifecycle

An organisation that is too small is struggling to survive. It probably has owner managers and generalist staff.

The in-house technical people needed to properly evaluate and implement a new information system simply aren’t there.

In larger organisations with more defined roles it’s more likely there are a few people with the capability to take on the necessary jobs.

Larger businesses may also have more money to hire outside help with specialist skills.

The main difference between 1999 and now is the amount of capability aware as a service – the software as a service or SAAS model.

Email, documents, file storage, file sharing, email marketing, website design – all the capabilities that would have taken teams of people to create are now available over the internet with simple interfaces most people can use quickly.

The challenging area now is selecting and using specialist software that helps businesses do unique work.

Things haven’t changed over the decades. It’s not really about software.

It’s always about the business and the people in it.

Why we might be thinking about goals all wrong

types-of-goals.png

Goal setting theory has always bothered me – there’s something a little artificial about it – something not entirely natural.

Take the wording in this paper, for example. Edwin Locke and Gary Latham point out that some 400 studies carried out over 25 years show that specific goals lead to better task performance than easy or vague or abstract ones.

This inference hits the target but misses the point.

Before we look at why that is the case, it is useful to note that goals are then split into extrinsic and intrinsic ones.

We try and achieve extrinsic goals to show that we are capable of doing something, or to avoid showing that we are not capable.

We try and achieve intrinsic goals because they give us feelings of mastery and control and satisfaction.

The findings from more studies is that intrinsic goals lead to longer lasting performance.

There seems to be little appreciation, however, about the nature of goals themselves.

A more useful classification of goals, it seems to me, is to think of them as simple or complex.

A simple goal might be something like hit the bulls eye four our of five times on a shooting range. A complex goal might be create a sustainable level of income for a consulting business.

What happens all too often, especially when it comes to an activity like sales, is that we try and set simple goals and targets to achieve a complex outcome.

We’re then surprised and disappointed when the results don’t materialise and get cross and angry and change people.

Perhaps the mistake we’re making is in thinking that all goals are the same and all we need to do is make them SMART – the whole specific, measurable, achievable, realistic and time bound thing that is trotted out in courses.

Instead, we need to recognise the characteristics of the two types of goals and what we need to do to make progress towards them.

Take a simple goal, like getting better at hitting a target with a bow and arrow.

That is a specific goal and can be made SMART.

We can make progress towards the goal by improving how we carry out each step of the sequence of activities needed to achieve goal.

Elite athletes train until their muscles remember what to do and visualise every step they must carry out.

Finally, simple goals have an end point. We achieve them – and then that’s that. There is nothing else we need to do.

Complex goals, on the other hand are vague. They include things like living a good life, having peace of mind, and doing one’s best.

We make progress towards such goals not by following steps but by practising behaviours.

For example, we might try and learn something new every day, talk to a new person, take a different route, try new experiences.

When it comes to tasks like writing or sales, it is well known that having ridiculously low targets is a good way to actually make progress.

Finally, with complex goals there is no obvious end. When do you achieve being good? When is your business sustainable?

There is always change and we will need to adapt and discard less useful behaviours and adopt more useful ones.

Goal setting is a useful exercise. The problem is that we may be trying to adapt goals that are designed for success in fields like sport to life in general.

And life is more complex than that.

What Groucho Marx teaches us about win-win strategies

groucho-marx-strategy.png

Groucho Marx, an American comedian, once wrote when resigning from a club that he didn’t want to belong to any club that would have him as a member.

Which, when we think about it, is often the way that we approach many situations.

Take selling or job hunting.

Many of us believe that if we make enough calls or apply to enough positions we’ll get somewhere – it’s a numbers game and we just need to make the numbers.

So we grind it out, spending day after day, and wondering why we aren’t getting anywhere fast.

That’s not a strategy – it’s a treadmill.

Terry Speed, Professor Emeritus at the University of California, Berkeley writing in the American Statistical Association membership magazine, suggests that a job hunter should instead make two lists.

  1. Where would I immediately accept a job offer?
  2. Which employers would be delighted to employ me?

It’s important that answers to both questions are unconditional – we accept and they offer without bargaining.

If we’re thinking like Groucho Marx, there is no win-win.

We want to work at places that may not want us. And we’re hesitant to consider the places that do.

According to Professor Speed, we’re in good shape and well calibrated if there is an overlap between the lists.

It’s worth spending the time to work out who really wants to – or will want to work with us because we can both benefit from collaborating.

That really means seeing if we’re aligned. No amount of external management or manipulation can overcome poor alignment of goals and expectations.

Conversely – sharing goals and aligning expectations means that we can spend less time on control and more time on execution.

Ideally then, we’d join clubs that we really wanted to be part of, and which would be delighted to have us as members.

But how do we know when this is the case – how do we know when we’re aligned?

There’s no easy answer to that question. It’s not something that can be assessed with a simple checklist.

We may just have to learn to look harder at what is in front of us until we can see.

How to become more intentional

intentional.png

What does it mean to be intentional?

Google to the rescue. It means to be deliberate, to do on purpose, to be purposeful.

That is a teleolgical concept – an attempt to explain something in terms of its relationship with a goal or final end point.

So, being intentional is, in a sense, being purpose driven, or goal driven.

How does knowing that help us?

There are three things, at least, that we need to think about when trying to be intentional.

The first is that we can’t do everything – we have to choose.

Students are often told when going to University that they have a choice of three things: sport, a social life and their studies.

If they are going to excel and be at the very top, they need to pick two to focus on.

We have to decide which two are most important to us and make those our primary activities.

Even if we aren’t planning to perform at an elite level, we still have to make choices between reading and watching telly, between going out late partying and staying up late working on a business.

The second thing is that we have to develop routines.

Willpower is a hard and tiring way to organise our lives.

Routines are better. If we set and keep appointments with ourselves every day to do the things that are important then, over time, we will see results.

We don’t have to set hard to achieve targets. We just need to do the minimum every day and it will build up over time.

As the saying goes, people overestimate what they can do in a year and underestimate what is possible in ten years.

The third thing is that we have to know how we will respond when we stumble.

And stumble we will. We may want to do something – work on a book, lose weight, make sales calls – and there will be times that we just don’t have what takes to do it.

There’s no point getting upset about that – it’s going to happen so we might as well deal with it.

As W.C Fields said, if at first you don’t succeed, try, try again. Then quit. There’s no point being a damn fool about it.

With some things it’s hard to keep going – especially when our intention is to overcome routines we have created earlier, like overeating or smoking.

The thing about stumbling is to follow the if-then rule. If something doesn’t go the way we wanted, then what are we going to do next?

Do we want to get to an end or get balance?

An intentional approach suggests that there is an end – a place we can get to where everything is all right.

At the same time, we may only realise we have arrived when we don’t feel the need to go elsewhere – the end is where we are right now.

That’s another choice we need to make.