Rapidinnovation -- A case study in Organizational Development & Change

The Backdrop:

A ductile iron pipe factory operates in Kharagpur, West Bengal, India. It is a joint venture between the famous Tatas and Kobutu Pipes of Japan. This factory is run by Japanese managers and supervisors and even some Japanese operators. They provided the technology, set up the plant, run the operations on a day to day basis and guide the Indian workers, supervisors and managers too.

The problem:

Ever since the Japanese installed their plant, 3.5 years ago, productivity never went beyond 50% of the rated capacity and quality rejections hovered around 10%, which they wanted to bring down below 5% level.

The approach taken by the Japanese managers:

They took their usual approach to analyze problems one by one. For that they employed all of their famous quality tools plus a mix of TPM and TQM approach. Huge amount of data were collected, to which one executive jokingly commented that data collection has generated so much paper that it could possibly cover the whole of Kharagpur

They tried their methods for the last 3.5 years without any success. Neither productivity nor quality improved by even 1%.

That is when the Chairman of the company invited me over to show him some 'magic' (he always jokingly refers to me as a 'magician', since he experienced my method 7 years back as a MD of another company)

Application of Rapidinnovation

My approach to the issue, that is application of Rapidinnovation, ran something like this:

Step 1: create an internal team focused on improving reliability and resilience of the organization to face this challenge. The team was a mix of junior, middle and high level executives. Fortunately I found this combination has an advantage of accelerating change.

Step 2: was to initiate them in the new thinking process and solving problems. Taught them my all time favorite method of Improvement through design, named Rapidinnovation -- a) make them see the connection between all problems. Obviously, not all problems are to be tackled one by one. Only the critical nodes are to be address to resolve the issue holistically b) Show them the unity of the opposites to take the "creative middle" c) Minimal invasion or change based on the principle that a small change creates the desired change in the system both quantitatively and qualitatively. d) How all processes and phenomena would naturally negate their present existence to go back to the previous one hence developing a method of spotting changes and adapting quickly in a given situation. The focus was to creatively strike a balance between 'reliability' and 'resilience'.

Two significant ideas of the approach were.

a) The design changes appeared seemingly insignificant. Extremely small changes (pivot points or lever points -- a lesson I learned from Judo). Now I call this Minimalist invasion surgery.

b) No specific attention was given either to improve productivity or quality. In fact not a single quality problem was addressed in the entire engagement. The changes had a holistic effect -- i.e. small changes had their effect on the whole (principle of interdependence)

Step 3: was to work out a few problems directly for them to believe that the method of problem solving and improvement works. That is what I term as the Non-Process in problem solving i.e. -- Examine things in isolation and then see them in their own environment (interdependence, interactions and the 'struggle'). Objective is to help things continue their 'struggle' to be in the 'creative middle' of everything.

Step 4: was to encourage them to apply the method themselves and gain internal confidence and esteem. Here my role was that of a facilitator and a critic.

Step 5: make them think about quickly spotting changes to quickly adapt to improve resilience within the organization.

Step 6: walk the creative middle.

The Results

The results were astounding: Productivity increased by 100% to reach the 100% of rated capacity and quality rejections reduced and came down below the 5% level (i.e. by 100% from former levels) in just under 5 months and the results are consistent over the past 4 months at the time of writing this event. This innovative intervention left the organization with on going benefits for possibly years (that has been my intention in all my previous engagements, which were so far successfully achieved barring a negligible few, 2 out of 50 to be precise).

Appreciation & Comments

a) This is what the Chairman of the company commented:

"Thanks Dibyendu;

I am keeping track of the developments – and the results a lot of confidence that TMKPL would be ranked as one of the best performing cos. in DIP business in the world.

Thanks for accepting the challenge and carrying it forward well.

I had asked Somenath to get across to you about BF opn. ; did he get across to you?

Harsh"

(now he wants the magic for another plant focusing on operation)

b) This is what a senior team member had to comment. I loved it since they see the approach as something that changes 'culture'. (His reference to Reliability Management is the name of my consulting firm RMCPL, solely engaged in problem solving.)

Quote

...RELIABILITY MANAGEMENT is not a problem solving tool, its more of OBSERVING THE PROBLEMS IN A DIFFERENT FASHION AND TOTALLY A DIFFERENT APPROACH TO SOLVE THESE PROBLEMS. It has changed the mind set and APPROACH towards solving problems amongst the team members. RELIABILITY MANAGEMENT IS A TOOL FOR CULTURAL CHANGE throughout the organization which is reflected not only in availability increase of the equipment but also in reduction in the percentage of Rejection and other improvements.

More success will come if we can deploy and involve more people across the organization into this approach.

G Dhar, Manager, TMKPL, Kharagpur

Unquote.

Lesson learned:

Organizational Development and Change Management must always be centred around the reality of problems, challenges and threats an organization suffers from. Then only changes to the way people work happen. Similarly, innovation is also centred around unexpected events that happen in an organization.

Effortless Changes

We all want to change something or the other all the time.

Many men want to look and feel like 22 year olds when they are almost over the hill and touching 50. So they try hard to change and behave like a youth sprinkled with a liberal dose of self hypnotism that age is only a number and try hanging around with women half their age. It does not work.

Similarly many women would love to hide their ever growing imagined wrinkles and sagging skin to look like a sweet sixteen through application of costliest available cosmetics till men can no longer read between the lines. That does not work either. 

We imagine the trauma of cancer and do our best to avoid the disease by supplementing our breakfast with anti-oxidant capsules and make bold public declaration of giving up smoking, drinking and probably sex. The chance of having the disease might in all probability be decided by the flip of an unbiased coin. 

We also don't want to remain poor. So we try with great effort to change our thinking and action by copying the richest people on earth with well concealed hopes pinned onto their rag to riches stories only to find at the end that we were left running on an endless conveyor that leads nowhere. 

Lot many are crazy about going up the very oily and slippery corporate ladder. So we gather around us all types of self help books that promise 101 ways to reach the top in less than 5 years. We all know what might happen. The authors of the self help books get richer by the day and we continue to remain where we were or might even slip off the ladder to break a bone or two.

As human beings we are all afraid of death. Some take it to absurd extremes by changing their lifestyle and probably their inner lives in 8 predictable ways like a) give up smoking b) give up drinking c) moderate love making d) moderate exercise e) trim the fat around the waist f) take cholesterol lowering drugs for life g) take aspirin for life h) change the nature of work. Risk assessment studies show the worth of such careful interventions and changes to be +/- 2.5 years than one would have normally lived. It isn't worth the effort.

Most of our lives we try to deal with changes the hard way with lot of pomp and fury signifying nothing. The reasons for such changes are a) Fear b) Social pressure c) Pleasure d) Self aggrandizement. Changes in these lines are always fraught with inherent danger of not working out well enough resulting in wasted effort, time, money and a big dent on the self esteem. Moreover, these are all superficial in nature. We think we have changed the inputs but the outputs don't change in any significant ways. It might at times, deteriorate instead.

That leaves us with very little precious time and energy to go for real changes. Changes that follow our natural instinct to do something very well. Changes that calls upon us to take real life changing initiatives for others. Changes that allow us to live more authentically. Changes that allow us to discover ourselves through play. Changes that spring from our intelligent insights and responses to ever changing reality and engaging in something more meaningful and humane. Changes that are based on the lessons learned from the dynamics of nature. Changes that are based on the reflection of reality. Changes that can bring about quantum effects. And changes that can be done almost silently.

These, fortunately, are all real big changes where a small change in the input with the right initiative and thought can bring about dramatic and long lasting changes in output.

Surprisingly, such changes call for the minimum effort, minimum time and minimum resources. Moreover, such types of changes can be brought about in any human activity that we are passionately engaged in. The other good thing is such changes are effortless and easy; devoid of fear, anxiety, pressure to conform and egos, which in turn release endless creative energies enabling us to make the right moves to live life more authentically, just as it was meant to be.

Are we game for effortless changes?

 

Epidemic of Cultural Blindness

Even very intelligent people sometimes mistakenly take culture of a country to be some sort of yardstick to measure other cultures. By doing so, they get utterly confused since they find most of it out of sync.

Then they commit another terrible mistake. They blame it on the culture for a country's failure to achieve economic progress or to raise their standard of living or something else by 'benchmarking' another country. 

Many organizations also commit the same mistake. They feel if only some cultural changes can be brought about everything would change overnight. And most of their ugly problems would never resurface. They believe that attitude of the people would change which would enable them to think differently, talk differently and work differently. Management of such organizations go about this task of conversion with the zeal of religious evangelists spending huge amounts of time, energy and money only to generate lot of confusion in the end.

Recently found an organization trying to implement Japanese culture in their manufacturing processes. After trying it out for a year they lamented, "We are nowhere near our desired target."

I asked them, "How does manufacturing effectiveness of your organization compare to the manufacturing effectiveness of the best in class, Japanese included."

They replied, "Well it is nearly same. The difference is negligible"

Pushing them further I followed up by asking "Then why do you want to bring about this cultural change?"

Obviously, there wasn't any answer to this.

Similarly, in a joint venture organization the Japanese who were partners blamed the culture of the other partner country for lack of productivity. The real issue lay in the cultural mismatch of the two partners working shoulder to shoulder in the same workspace.

In another newly acquired plant in Chile, the Chairman who was an Indian, during a board meeting lectured the top managers, "I think the process you people are following is absolutely wrong. You must follow the unique process we have developed back in India. Some of you must visit to learn more about that."

The top managers gently reminded him, "But what is wrong in the way we work? There is no quality rejection, no customer complaints, no productivity loss and to say the truth our productivity in this line of activity is best in the world."

Well, you know better. The better way might have been "Let me learn your methods and the ways in which you work to consistently produce high quality stuff and ship goods with the highest productivity"

But we simply can't shrug off this attitude of 'I am holier than Thou so I know better' simply because one has more money or more economic advantage or probably more educational certificates compared to another. 

The same mistake happens in the concepts of globalization and standardization. Ray-ban had to close shop in India. Their frames were simply out of proportion on an Indian face.

Coke came to India secretly nourishing the idea that Indians would soon forget about drinking water. They would drink Coke instead.

Kellogg harbored similar ideas. They would provide more nutrition to wean away Indians from their traditional breakfasts.

Nothing of these ever happened. Indians did not forget to cling to water and anything other than traditional breakfast tasted bland or insipid.

We, more often than we suspect, fall prey to this cultural trap in our personal relationships too.

Are we suffering from this "epidemic of cultural blindness"?

Management Upside Down - Sparkling Insights!

Rahul, a young Executive Director of a fast growing multi-national company startled by his nightmare broke into a cold sweat as he woke up.

What would happen to his vibrant flourishing business if the top management team who were ready to fly to Dubai for the annual sales conference in two days time died of a violent air crash? His global business would then come crashing like a pack of cards and there would be none to look after the vast wealth that has been created as he narrated his nightmare to me. 

"Why would that be?" I asked. 

"Isn't that obvious? All knowledge of running this company lies with these few chosen ones. Once they were gone wealth vanishes in no time" he replied emphatically. 

"But don't you think that sooner or later all of them would leave the scene anyway? What do you do then?" I quipped in response.

"Frankly I don't know. That has really kept me thinking. There are no Jack Welch or A M Naik who is determined to make his way up from the ranks. Don't know how to make even one?", Rahul voice trailed off pensively.

This story made me sit up and start thinking. Isn't this the same story for all companies all over the world? Aren't people fighting to find an answer to these deep questions on knowledge, leadership and organizations? What can be a possible solution to this business problem that has spread like an epidemic and refuses to let go of its iron grip on our lives?

Such difficult questions possibly can't be answered through a brilliant stroke of imagination. Many have tried without much success. To find an answer we would have to look at something deeper - the evolution of management from the early uncertain days of the industrial revolution to the present day where all time honored rules of management are headed for a grand collapse (Nature's Model). The clue lies there. 

This is how management always worked with minor and insignificant modifications here and there. 

It always started with a grand plan to make a profit. Don't suspect that I am against 'profit' or like to label it as a dirty word. Far from it! Profits are needed. It is blood of an organization. Anyway, to chalk out the grand plan a few old men (only now it is fashionable to include a few women too) sat together in a room called the board room to come up with a 'how to' list of making money from an idea. We called that strategy.

Once that was framed the next question that plagued these old souls was how the hell do we organize ourselves and operate? They then came up with exotic game plans, choc-a-block with funny rules and regulations, making the entire organization 'rigid' (if not frigid) 'air-tight' and 'water-proof' -- nothing can touch them, no secret can ever dream to escape, no employee can ever think of anything else but work, work and work...etc. They called it a 'system'.

With the system in place these grand old people heaved a sigh of relief. Half the job is done. Now we need some 'dedicated', 'loyal', 'trusted' servants (whoops! employees) to work their grand design called the system to their heart's content to churn out money. The model was no different to the 'factory model'. Pop in something and out pops something else from the other side of the machine.

Same was in business. So they carefully selected the 'servants' to work for them and just like selecting good machines they looked hard for the desired attributes for doing the back breaking jobs -- is he/she strong, healthy, good looking, has the right attitude??? (still couldn't figure out how they measure that), background, education blah blah blah... . They would take all pains just the way they would to pick the best variety of apples from the marketplace. It had to be rigorous since the 'chosen ones' like gladiators, would have to sweat it out for them in the next 2 to 3 decades.

But soon they found out that attributes of people change over time. They were not "behaving" like the machines they thought they got with so much rigor and patience. They started asking for things that weren't promised when they got in. That was something to worry about. What made them most worried was when they started thinking and suggesting and voicing their opinions on how to go about their jobs and perhaps how to do them better.

That wasn't good news to their old hardened ears. They have to stop them thinking. They are to be aligned to the goal of the organization. They are to be kept in line and on their toes. And they are to be occasionally whipped when they break rules or ranks to show who is the master and the lord that provides them their humble bread.

In comes the Human Resource Department, a sobriquet for the old fashioned Time Office and Personnel Department, whose only job was to keep employee behavior in check. Keep them in line. Indoctrinate them. Inject them with the lovely tunes of loyalty, feel good factor with a good day's job. Give them some butter if they do too well..... Spend time to correct the behavior of people not to say that a good amount of time, energy and resources went into managing work that consumed a large extent of people's productive time.

And what might happen when strategy, systems and behavior of people are all lined up? It would create work that produced goods and services of some value to thousands of customers. So a classic division was formed -- a small group of producers and an ever increasing group of consumers. More the consumers merrier the game became. All that  management had to do was to ensnare more and more consumers in their net and keep looking for more. The word was 'marketing'. 

This way of operating could be done for a pretty long time. All that was needed to keep this well structured machinery running was a pot of gold. Deeper the pockets better was the show which people thought would be perpetual in nature. At last management was able to create a perpetual machine that defied all known natural laws.

Did they? No. By 2008 everything that was so sacrosanct and held in high esteem started to disintegrate with the coming of the great recession. Big and seemingly invincible companies folded up. Unemployment kept rising. No new jobs could be created. Businesses faltered. And those that existed counted their days to doom.

The old way of functioning was definitely clumsy, complex, rigid and unmanageable that not only provided very little value to customers but also wasted a lot of energy in managing and keeping the system in order.

What traditional businesses failed to notice were the slow changes happening all around them in other spheres of human activities (Post Offices to #SM). Things were changing. And so did the nature of work. The fundamental change was consumers became producers and were blurring the line between producers and consumers. It happened to Post Offices, Schools, Publishing business, Consulting, Telephones, and was quickly spreading to all human activities in ways people would  have never imagined even a few years back.

The consumers created their own value independently and interacted and shared it with their network to create more value and consume it themselves at a price much less than the prevailing market price. The days of grand old institutions, middle men, dealers, publishers, advertisers were all but over.

In comes a new thinking and a new way to create and manage businesses and a lot of value  -- the answer to Rahul's nightmare.

The earlier model, basically static in nature and greatly determined by financial capital, was Strategy -- Systems -- Behavior -- Work -- Value.

In this model, Strategy informed the nature of work and the value that was created for the customer.

The new model is just the reverse of what we knew for so long. What happens when we reverse it? It becomes Value -- Work -- Behavior -- Systems -- Strategy. 

In this new model, 'Value' and 'Work' inform Strategy not the other way around. Therefore, it is more dependent on people including customers to participate, share and contribute their learning and knowledge in the economic process than being exclusively dependent on the strength of financial capital.

So, what might be the challenges for organizations to embrace the new way of working?

Some of these are:

1. How do we involve and engage customers and employees to participate in the 'value' creation process to create 'multiple values' instead of only focusing on the goal of generating profits (single value)?

2. How do we make 'work' observable and tractable from which everything else emerges?

3. How do we create a platform of emergent learning that spontaneously creates 'leaders' who co-produce wealth not spawn 'servants', 'managers' and 'bosses' who run the systems like mere cogs in the wheel?

Now that we have found the answer to Rahul's nightmare answers to these challenges would help him create simple yet intelligently superior and greatly adaptable organization that creates multiple values for the collective.

For Rahul his ghastly nightmares would be over. But he would now have more things to challenge his mind, which would surely be fun since he may now keep thinking while doing the new thing, learning and improvising as he goes along in his new journey.

He is well on his way creating history.

Wish him well!

But do ask me how history is being created.

 

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The Power of 3 - Changes in Management Thinking.

This great story demonstrates a fundamental emergence in our lives. The old ways of thinking and managing simply wouldn't work any longer.

The 'science' and practice' of management as we know of it today were originally invented to solve two very important problems, which were:

a) How do we get ordinary folks do complicated and repetitive tasks to achieve a standard of efficiency and standardization to optimize profits?

b) How do we make our way through a complex web of processes to deliver goods and services to our clients? The complexity arose from scaling up of operations meant to generate ever increasing volume of goods and services that could provide more profits and subdue competitors.

In order to do that we created lot many logical rules and regulations. The number of rules increased with the degree of operational complexity. Then we trained and made people follow those rules to achieve the magic numbers that could produce more profits that are constantly under squeeze. 

With our present thinking we understand that such management thinking does not work well beyond a certain degree of complexity. Why is that?

So far we focused on objects that played any role within business cycles of production and consumption. Sometimes we focused on machines while at other times we focused on people or customers. And yet on some other occasion we forced our attention onto suppliers and quality or we looked at increasing inventory levels. We never quite saw the whole in one breath. What we clearly missed out was to observe the relationships between objects in a given context. What we chose to do instead was to focus wholeheartedly on objects and their functions and properties without taking into consideration the context in which they operated. We failed to realize the importance of interdependent relationships between all things that simultanteously arise and abate in the system in a "wholistic" manner.

What happens when we fail to see relationships?

Let us take two objects that are related to each other. Then the possible relationships that can exist between them are four [2 to the power 2 gives us 4]. As we keep increasing the number of related objects it keeps following the same power law [2 to the power of n, where n = the number of related objects].

It is then easy to imagine the exponential rise in the number of possible relationships as the system becomes more and more complex. How can such exponential behavior be controlled and regulated by a set of linear rules and regulations? Since that is clearly not possible to do so it exposes the unscientific nature of our so called 'scientific' management thinking.  

This flaw is clearly depicted in the video. As the number of cars increased along with the rise in the number of pedestrians and cyclists the system soon reached a critical point of complexity beyond which it was not possible to regulate the traffic flow, reduce the number of traffic jams and keep accidents in check. Even the logic of operating traffic lights represents a part of the growing rules and regulations to contain the menace of slowing traffic, snarling jams and terrible accidents without much success ofcourse.

So, what did the new management thinking do? They drastically reduced the number of rules and regulations to one simple rule - "give way to pedestrians and cyclists first". The result of such a brilliant move is amply demonstrated in the video.

What lessons management can learn from this? Probably these:

1. As the system becomes more and more complex reduce the complexity of the jobs ordinary folks are called on to do in all possible ways. One of the simplest way to do that is to reduce the number of irrelevant rules and regulations that bind and blind people from performing better. Forcing people to keep their eyes on so many rules is enough to make anyone crazy and make mistakes. For example, by simply enabling drivers not to pay any attention to the traffic signals and policemen but to keep in mind one simple rule greatly simplified their job of driving safely. This then left the drivers free to focus on their goals without getting distracted by a host of unrelated issues. Ease of traffic flow, reduction of jams and elimination of accidents are few of the by-products of making jobs easier and free of unnecessary clutter. 

2. Redesign the system so as to reduce the number of relationships one has to negotiate in order to achieve the desired results. This was done by redesigning the roads at critical traffic intersections.  By reducing the total number of relationships within a system we can easily convert complex processes to much simpler ones. 

3. Managers are then left to keep healthy communications going within the system and focus their attention to fine tune the existing relationships and also think of simplifying the processes further through redesign.

Aren't these three universal management lessons simple enough?

Let me know what you think.

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Robots Run the Asylum

Winter was mild and cool

Time for fun& play

But old Mr. Ram was hard at work

 

25 years back on a fine summer day

Mr. Ram opened his factory

So that it never shuts down

 

Within last 5 seasons

Mr. Ram bought or built 6 more factories around the globe

So that his businesses never close & monies flow

 

Last autumn, when leaves were losing colors

Mr. Ram turned 72

He suddenly became young at heart & more adventurous

 

So, on a fine winter morning

He vowed never hit the streets to the airport again

Except visit his oldest factory once a day

 

50 years back

He was the brightest management student around

Now he thinks all management theories are nothing but junk

 

So he decides to muddle the mud on the shop floor

With his own ideas tinged by ‘creativity’

Rejecting all that he passionately knew

One Sunday evening when the moon shone bright

He had one of his brightest ideas

Why not have three Works Managers instead of one?

 

Next morning when employees trooped in grudgingly

They saw the notice board in awe

Henceforth each one would handle 5 bosses

By afternoon, when the sun shone dimly on the wintry sky

Managers were crest fallen – not knowing what to do

Employees smiled clearly knowing the path ahead

 

By Friday evening the air was chill

Productivity went through the floor

Lunatics ran the asylum

 

Darkness fell, stilling everything around

Motion came to a grinding halt.

Robots moved everywhere not knowing where to go

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RESISTANCE TO CHANGE

The world has been changing so fast that it scarcely seems to be the same every other day. In 1997, when India was punished for going Nuclear and letting the world knows about its nuclear capability; In Europe, the euro had not been introduced as a common currency; Amitabh Bacchan was still young and Madhuri Dixit was not so plump; Hong Kong had not yet been handed back to China; Google did not exist; the dragon’s  dominance in the world economic map was still a far cry and the terrorist attacks of 9/11 were still four years away ---- Deepak was frustrated , why is his father not listening to him.

Deepak wanted to change his father’s old “Ambassador “car (a distant cousiin of 1941 model Austin) for a new Generation X car. The newspapers were full of advertisements. “Exchange your old car for a new one, and pay on easy monthly installments. Deepak was trying desperately to convince his father but he was adamant. What his son is not aware of are the many cherished memories attached to the car. When Deepak was born he was brought from the local hospital in this car. Deepak had grown up with this car.

Deepak graduated and got into a Post Graduate Business Administration course.

He wanted to change the world too soon. He has now acquired a new motorbike with a funky look. He has changed his attire and wardrobe. Everything he has changed with the passage of time but he is still not able to change his father’s outlook, attitude and business policies. His father still goes to the factory in a white sweat shirt and a cotton trouser. He still mingles with the factory workers. Tries to gauge their feelings. Hugs them when he is overjoyed and also hurls choicest abuses when angry.

Now India has opened up. Private bankers have come in. “Gone are the days when a nationalized Bank staff would talk to you rudely”. Smart young people are now manning the private banks with their plastic smile, trying every moment to access a customer in terms of business he would give. But India is different. People can differentiate between the artificial and the natural. The common man can do wonders. He can shun Ray-Ban, Reebok and prefer locally made under garments. He uses Debit Cards instead of Credit Cards. The billions of middle class Indian market use their own thinking based on their sincere feelings for their families.  

Deepak comes to the factory in a Ford but his father still comes in the old car. People love his father more than him. Deepak had tried to implement all his “imported management policies” in the factory. His father had given him the required space. Some were successful while others miserably failed.

Deepak wonders why things don’t work here. He has tried to implement most of the case studies that he has learned. He is impatient. Why India is so averse to change? Is there a physiological factor playing among the Indians? A change is required but why there is so much resistance?

What he fails to notice are the small meaningful energetic changes that keep taking place against seeming changelessness.

He forgets that small changes are much more powerful than big artificial ones. There is actually no resistance. How can one grapple and fight against something that has no resistance at all. So, no big changes can be brought about in India by copying something or somebody else. It is always a state of becoming not being. That is the ethos of the land called India.

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