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Enhancing Organizational Performance


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There is enormous pressure for conformity within our society. Are you reading the right books, driving the right car, do your children go to the right schools etc.? Conforming to societal norms confers status. It makes you seem to be like others who are deemed to be successful – others you want to be like.  Authors buy up copies of their books in order to spur demand. (In 1995, the authors of a management book bought 50,000 copies of their book from stores that the NY Times monitored in order to land on the best sellers list, they did, and the book then continued to do well despite mediocre reviews). Restaurants routinely fill the seats by the windows so passersby can see that others have selected to eat at the restaurant. Advertisements for clothes, cars, food, and other products show attractive, successful people using the product, inferring that if you use the product you too can be like these people.

We of course are no different from our cousins in the natural world. Researchers at the Yerkes Primate Center recently reported that apes conform to cultural norms. In this case they performed a task the same way that other apes in the group did, even if an alternative method was available. They wanted to fit in, to be like the others. What was not discussed, and would be a fascinating next step, would be to determine the course of action the apes would take if it were obvious that the alternative method was clearly superior to the commonly used method. Would that confer status on the “innovator” or would they be pushed to the side, their status lowered?

Not surprisingly the desire to conform and the pressures to conform extend to the business environment as well.  Organizations create rules to deal with the 5%-10% of the population that do not conform to its standards. The tendency is to push people to the middle of the distribution, towards behaving like others in the group. This can create a “keep your head down” kind of mentality whose chief beneficiary is mediocrity within the organization. (Some organizations pride themselves on being non-traditional innovative, non-conforming organizations. These organizations may have set up a culture that pushes “conforming to our non-conformity” and that is a topic worthy of a separate piece by itself).  Organizations clearly have to manage their resources in order to achieve their goals, but is anything suffering in the commonly used practices that have developed?

I want to turn to the world of quality control – Six Sigma – for a possible answer. Within the world of Six Sigma there is a paradox that is articulated as follows: to attain Six Sigma performance we must minimize process variability (make our processes and outcomes conform), slack and redundancy by building variability, slack and redundancy into our organizations. In other words, in order to constantly improve performance, room must be made in the organization for the investigation, the vetting of alternative methods and procedures.

Wait a minute, today’s organizations are lean and mean. You have to constantly do more with less. Organizations are downsized, resulting in fewer people but the amount of work required does not often get adjusted. You can’t be efficient and get all this work done if you build in extra resources in order to test new procedures and methods. But you must. Long term process improvement and organizational success are dependent upon it.

With the goal of improving the organizational performance in mind, the path does not begin with the concept that what we need to do is to stamp out all variability, to make everything conform to a certain standard. Variability needs to be understood (through rigorous measurement), it needs to be controlled (in order to minimize defects or errors), but removing all variability eliminates the ability of the organization to learn from itself and eliminates opportunities to improve. Variability is needed in order for improvement to occur.

Here is an example to illustrate that point. If you are examining 200 departments within an organization, and there is no variation whatsoever, you can not learn much. You can not learn that in these 15 departments that do “A”, “A” leads to more positive outcomes such as lower levels of employee turnover compared to the 15 departments that do “B”.  In this case “A” and “B” can be the same thing but at different levels. For example “A” might be a high level of employee engagement, whereas “B” might be a low level of engagement. By examining these differences the organization can learn, it can improve. Without variation you can not learn, you can not determine that “A” leads to one outcome and alternative “B” to another.

In addition to the concept of variability, add the concept of redundancy. Redundancy is needed in order to allow experimentation. Redundancy is when two different approaches are available to achieve a desired outcome. For instance using a stamping machine to form a part from a roll of sheet metal, or using powdered metal to form the same part in a mold under pressure. Which procedure is better, leading to lower costs, less waste, fewer defects, and better part performance?

By being able to breathe through the nose and mouth, a redundancy, nature was freed up to experiment with noses for other potential uses – such as the elephant’s trunk. If the elephant could not breathe through its mouth it would be in a precarious position if it filled it’s trunk with water and then needed a breath. By having people perform a task using more than one method it is possible to determine if one method is more advantageous than another. Upon standardizing around the more advantageous method, you immediately begin investigating other methods (in a controlled fashion) to see if those new methods yield even more improvement. This requires slack, the controlled embrace of variability and redundancy.

In work I have done over the years it appears that organizations that have strong diversity programs outperform similar organizations that do not. Having a diversity of people with different backgrounds, skill sets, from different cultures etc. sets the stage for the organization to pick the best or to potentially have knowledge of the variety of process and procedures available to it, to have within the organization different points of view (this is assuming that these different points of view are valued and those with them are not ostracized). It is another way to embrace variability and for an organization to learn from itself.

At the Max Planck Institute, it was recently demonstrated that apes possess a surprising understanding of tools and even make future plans to use them. In one experiment an ape that came into a room, bringing with him the wrong tool to complete a task (and could not go back to get the correct tool), was able to shape the existing tool into a new tool to successfully complete the task. I don’t know about you but I am proud of my cousins, and I wonder if we can learn to shape new and improved business tools out of the ones we currently use.

© 2010 by Jeffrey M. Saltzman. All rights reserved.

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Written by Jeffrey M. Saltzman

November 19, 2009 at 3:15 pm

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