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Climetrics: Inside the process

So you’ve hired Lloyd Parry to work on your internal change program. You’ve seen the overview of how Climetrics works and understand the value of creating a highly adaptive organisation. But how does the process work? You’ve got thousands of employees spread over branch offices around the world. How can we possibly live up to the promise of adaptive and  make change happen at the scale you need it to happen?

If I was in the same situation, I’d be asking the same questions.

So here is where I pull back the curtain and tell you how it’s done.

Here’s how change is made…

After discussing the proposal and scope of the process, we agree on terms and sign off on the proposal.

Next comes a two-day site visit.

Day One, we do a detailed site visit scoping for the climetrics survey and set survey parameters.

We meet with two or three managers to gain a deeper understanding of:

    • stated organisational values
    • organisational structures
    • duties of the main teams, goals-targets-objectives
    • management reporting
    • change programs and their objectives
    • current barriers and constraints
    • terminology and jargon used within the business

On Day Two, we meet with various managers and teams, conduct on-site data gathering and garner insight into day- to-day operations and decision-making.

After the two day site visit, we create a custom survey template and review it with a representative of the organisation. Following the review we run the survey with a small test team.

After any necessary adjustments, all staff and managers complete the full survey.

We then take the completed survey results and conduct a statistical analysis of the data. That information combined with the on-site interviews forms the basis of an executive report.

With the Climetrics executive report in hand, we then meet with the client and the survey statistician.

After that meeting the conclusions and recommendations are published jointly by the client and Lloyd Parry International.

When these recommendations are accepted we then go about creating a custom program that takes into account the entire organisation and all its branches.

What makes our approach different is our commitment to knowledge transfer. We don’t just guide and implement the program, we teach the organisations work with how to sustain and adapt  their processes long after we have left.

To learn how Lloyd Parry International can transform your organization through Climetrics, please get in touch.

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The rewards of ‘smarting up’ your customer-facing staff

Right across the board, today’s customers are demanding greater and greater choice. To stay successful in a rapidly changing climate, organisations must not only confront and deal with this demand for choice, they must design a corporate culture which actively embraces it.

‘Smarting up’ sales teams has been a vital part of my work in helping corporations develop such a culture. This ‘smarting up’ means taking managers and operational staff beyond a traditional mindset and into one which develops vastly improved customer experiences to help grow the revenue of the organisation.

We’ve all had those frustrating customer experiences where the person we have just spoken to has not been able to help us. Our needs have not been met and our dissatisfaction is vented at the employee or the next tier of management in the company. But the real fault is not there, it is right at the top level.

Those negative customer experiences are almost always brought about because employees have been placed into ‘dumbed down’ positions where they are prohibited from moving beyond the transactional level. Their task is simply to increase the portfolio of a narrow range of options.

When Fujitsu – an IT outsourcing company I worked with – decided to move its focus client business outcomes and then adjust its IT service levels in response, they ‘smarted up’ their staff to more deeply understand their clients. The result for their airline client was reduced queues at ticket offices, check-ins and during flight delays.

When customers are not listened to on the other hand, or they feel that their specific query or demand has not been met, they are made to feel like one of a million and not one in a million.

In the ‘smarted up’ model, on the other hand, where sales staff are given the freedom to engage in wider ranging conversations with customers in order to understand their situations, the customer experience becomes relational and personal.

In this model, staff are actively looking for possibilities and ideas for new services or new products which can be added to the portfolio. Our smart people are now telling the organisation what customers really want, becoming, in the process, a source of new and exciting products and services to generate more revenue for the company.

And now the customer is made to feel like one in a million, not one of a million, resulting in increased customer loyalty.

I once worked with a large telecommunications firm who, in the name of standardisation, offered a one-size-fits-all set of services which they delivered in a strict transactional process, causing much frustration to clients and shareholders who were concerned at the client churn rate.

Our work in ‘smarting up’ their staff allowed them to create a more efficient way of working which gave them the ability to generate a wide variety of new services. Thus increased responsiveness helped deliver new revenue streams.

As you can imagine, my work in growing this kind of cultural change in organisations often meets stiff resistance. One of the arguments against ‘smarting up’ is economic. ‘Can I afford to pay my sales staff more?’ and so on.

The sad truth is that too many business organisations know the cost of everything, but the customer value of nothing (to paraphrase Mr Wilde).

Once again, it comes down to the traditional, transactional mindset. When you separate ‘value’ from ‘cost’, everything is always going to become too expensive. The global drive to move work to the lowest labour cost economies betrays this inability to think beyond the transaction and the cost.

Implementing lean

This is amply borne out in the work I did with one of my clients, a well-known parcel and documents delivery company. After ‘smarting up’ their couriers, the company found that customers were wanting their packages to be weighed and safely packed with all paperwork completed when courier arrived to collect the parcel. Rather than try and drive couriers to greater efficiency, they had encouraged them to find ways of creating greater customer value. The result? New services, differentiation, new opportunities, greater job satisfaction and an enhanced customer experience.

Employing people to do smarter, more responsible jobs is an investment which delivers true value. ‘Smart up’ your sales staff and they will begin to uncover customer needs, acting as a kind of market research team to feed responses and ideas through the management chain.

The key to it all is to recognise the value of your most priceless commodity – your people.

Leader vs. manager

HR strategies to support Adaptive Lean Change

I recently wrote about the importance of Human Resources (HR) in the adoption of Adaptive Lean Change in the workplace.

By virtue of their connection to all levels of a business, they have the ability to shift the work culture zeitgeist in very specific ways.

Leader vs. manager

HR and Professional Development (PD) need to be almost prescient in identifying the current status of the organisation and anticipate new demands.

It’s also up to HR / PD to ensure to reflect the Lean purpose in all training courses offered, be it soft skills courses, management courses or technical courses.

However, is not enough to simply fulfil the basic HR infrastructure (e.g. training, workshops, etc) but to also develop supporting structures and support groups.

Here’s what those supports would look like.

Supporting structures:

An educational framework that unfolds alongside the overall development and keeps pace with newly identified requirements: a knowledge centre with scenario-based material (e.g.: podcasts, e-learning modules, documents, suggested readings, articles). Anybody from within the organisation can look up material based on their demands and requirements.

Support groups:

These are headed up by key players who support and drive change through their contributions. Most important are internal coach-mentors, consultants and trainers who sustain change and achievement after external consultants are no longer connected to the organization.

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If those contributing factors are not aligned by HR to the demands of ongoing change the overall success is jeopardized as the ‘old-world’ tools, processes and behaviours help to preserve/cement the old organisational norms.

HR needs to observe and support the transition from old-style hierarchical thinking to the newly defined freedom and working possibilities (and demands) of Lean.

Leadership

HR departments crucial in Lean effectiveness

One of my challenges in delivering the messages and methods of Adaptive Lean Change has been getting Human Resources (HR) departments to see their role in the process of change.

Lean is often perceived by businesses as being about operational efficiency which overshadows the crucial aspects of workplace climate and culture shifting, areas which are HR’s forte.

Leadership Signpost Shows Vision Values Empowerment and Encouragement

The irony is that Lean initiatives are more likely to fail in a business without the involvement of HR.

 HR must be involved to fully understand Lean, to intuit the underlying company strategy and  the required steps and milestones to get there.  They need to grasp the overall holistic  picture to appreciate how this is then translated into ‘sub-pictures’ within the organisation.  

It is up to HR to evaluate all this against the current company culture and climate and find ways and strategies to support change and overcome resistance, reluctance, doubts, complacency and the entrenched old behaviours.

Important areas which need to be adapted are:

– Reward and recognition systems
– Performance evaluation system
– Talent reviews
– Recruitment
– Promotion

Further, the Personnel department also plays a key role at developing culture and climate in those areas.

They must also develop Lean leadership capabilities:

– Leadership development (different talent reviews and selection criteria)
– Lean People management
– Organisational development

Leaders need to relay the Lean values of freedom, trust and respect which ensure the willing contributions of staff. They also need to study the different perspectives within a company to understand why staff and managers behave the way they do.

 

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HR need to appreciate that change cannot be dictated in a command and control environment by a group of elite-thinking managers: including, of course, HR management themselves.

HR vocabulary needs to be enriched with terms like engaging, leading, learning, and improving and, crucially, be able to explain their requisite meanings.

Finally, HR needs to be ‘the’ department that leads in Lean thinking and practices. If it doesn’t happen there, then credibility in the process suffers.

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Work culture and climate redux

A recent column of mine on the difference between a work climate and a work culture prompted an intriguing question from a reader on Linked In.

Although I have included the original post below this, in it I was underlining that while work-cultures are instituted over time based on workplace design and the trustworthiness of management or lack thereof, they can be difficult to change. In contrast work-climates are easy to change but are difficult to maintain for long periods until they solidify to become the new culture.

Tadeusz Kifner, Data Architect – IT Data Governance Management at Bank BPH wrote:

“Very good point of view. I would only ask you about your vision in relation to habits. As I observe, work climates seem to be dependent on habits more than on team collaboration and trust. What kind of techniques in your opinion are good to use to rebuild climate when organizational habits are very strong?”

It’s a good question.

There is a technical definition for work-climate – it’s the combined perceptions, thinking and feelings of a particular work group or whole organization. It is these perceptions and feelings that give rise to behaviour. The term Mr. Kifner used is ‘habit:’ a repetitive behaviour which is an outcome of climate. To get to the answer to his question we need to examine what drives the perceptions in the first place.

Our research has found that there are two main factors (there are many factors – but these have the highest influence)

Firstly, there’s the design of the organisation itself. Its job roles, reward and recognition systems, the goals that define success and the measurement system, all these are a matter of design and can be changed.

Secondly the attitude of managers to people, characterised by Command and Control or Listen and Adapt.

Many managers are by nature Listen and Adapt but are forced to act in a command and control manner because of the design features outlined above. We have a reinforcing circle that needs to be broken to change behaviours and habits.

The way I choose to break that circle is by highlighting the cost of non-productive behaviours in terms of business cost – i.e. customer experience, innovation but mostly the cost to gaining the willing contribution of staff and the loss of integrity of staff and managers. Only when the cost outweighs the benefits of behaviours can change conversations even begin.

Thanks to Tadeusz Kifner for the question.

The complete original blog post is as below:

Adaptive: Work climate and culture are not the same

I get calls from companies these days who are struggling with the amount of discontinuous change caused by technologies, new business models coupled with unprecedented pressures to upgrade the skills of people just to keep up let alone excel.

In addition the way organizations have to connect to other organizations around the world, even for temporary purposes simply to maintain daily delivery, have blown apart the whole notion of nice, solid steady value streams.
collabThe implications of all this constant, rapid change are profound and far reaching for the management of staff, the work design, measurement systems, people development and reward systems. Simply put, the old management models and thinking are obsolete.

Agile Management has now come of age with its fixation on the customer while enabling staff to continuously innovate and change the business. It’s an on-demand, continuous change system but unfortunately some businesses settle for far less by using Lean and Agile just to improve a few processes. That’s fine, but there’s so much more potential.

Some years ago, an organizational change transformation typically took about four years. But my organizational transformation process is now down to eighteen months because we use a diagnostic based on behaviour and something called ‘the work-climate‘. It has significant implications for how we design, build and operate organizations.

What is this behaviour-focused diagnostic looking at?  Well, we start with the work climate. Social scientists have been looking at work climates for many years and have demonstrated the effects of attitudes on certain work outcomes.

It was a revelation to me that we could actually understand the impact of the operating strategy, the structures, the managing practices and how we make decisions by examining the perceptions, feelings and behaviours of staff at every level of the organisation. The data provided a deep insight into the disconnects and misalignment of management thinking and pointed to alternative better approaches.

An adaptive trusting climate drives collaboration. Everybody thinks you can put people into a room, have them band together to solve a problem and that’s collaboration.  It’s not.  Collaboration is all about reciprocity.  Do you trust me and can I trust you?  If so, we’ll get along and be able to collaborate as long as we are connected to the real needs of customers.

An adaptive work climate needs to focus on ‘engaging’- how we understand the deep needs of customers, Learning- how we collaborate end to end to meet customer needs, ‘Leading’- how we devolve decision making to the point of interaction with the customer and lastly ‘improving’ – do staff have the authority and the methods to change how work is delivered to customers to meet their needs.

Is there good leadership? A challenging environment?, Enough freedom and decision making?  Do we share intelligence within our team? Within our function?  When do we see our senior management?  All of this gives rise to the work climate.

Work climate is entirely different to culture.  A culture takes a long time to establish, but once ingrained, proves very difficult to shift. The twist is that all cultures start off as a work climate that have sustained for a long periods of time.

Work climates can change very rapidly. There could be a good climate in an organization but when a new manager enters the mix with a strict focus on the numbers restricting freedom and locks everything down the climate changes rapidly but has the culture of the organization changed?  Probably not.

But if that manager keeps going like that for a sufficient length of time, it becomes ‘the way we work around here’.  So the toughest challenge for Adaptive transformations is changing the climate long enough so it becomes the culture.

It could be a toxic climate or a really productive climate but the secret to creating and maintaining an adaptive climate is management trustworthiness – can staff trust you?

Building trust between managers and staff is the path to real Adaptive organizations. Trust allows freedom, choice and the power to do what matters for customers through the willing contribution of staff and managers alike.

Stop trying to change cultures and start trying to change climates.

Purposeful adaptability

Adaptability is a crucial factor in the ability to survive, whatever the context.

In the natural world, adaptability is a response to the simple desire to survive and reproduce and it can be argued that its purpose is completely oblivious to the specific life forms mountain-climber-climbing-retro_fktDCL8uthemselves.

In the business world however, adaptability has to be consciously purposeful. For most organisations purpose is woefully underthought, expressed rather purposelessly via a catch-phrase such as ‘Our Purpose is to be No.1 in our marketplace’.

Perhaps this is part of the reason why most organisations don’t deliver long term prosperity for customers, employees and shareholders.

Unlike the natural world, organisations are free to choose their purpose, develop a common purpose upon which all stakeholders agree and then create structures and practices that keep the organisation and its services changing in response to obstacles, threats, and opportunities, keeping them on-purpose.

Organisations are also free to change their purpose. Adaptive organisations keep asking themselves ‘Is it still the right purpose’, and ‘are we exploring all avenues towards our purpose’.

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Organisational Adaptability is about developing a mind-set open to a new purpose coupled with the ability to redirect everything quickly and safely towards that new purpose.

collaboration-within-teams-is-adaptive

Adaptive: Work climate and culture are not the same

I get calls from companies these days who are struggling with the amount of discontinuous change caused by technologies, new business models coupled with unprecedented pressures to upgrade the skills of people just to keep up let alone excel.

In addition the way organizations have to connect to other organizations around the world, even for temporary purposes simply to maintain daily delivery, have blown apart the whole notion of nice, solid steady value streams.

collabThe implications of all this constant, rapid change are profound and far reaching for the management of staff, the work design, measurement systems, people development and reward systems. Simply put, the old management models and thinking are obsolete.

Adaptive Management has now come of age with its fixation on the customer while enabling staff to continuously innovate and change the business. It’s an on-demand, continuous change system but unfortunately some businesses settle for far less by using Lean and Agile just to improve a few processes. That’s fine, but there’s so much more potential.

Some years ago, an adaptive organizational transformation typically took about four years. But my organizational transformation process is now down to eighteen months because we use a diagnostic based on behaviour and something called ‘the work-climate’. It has significant implications for how we design, build and operate organizations.

What is this behaviour-focused diagnostic looking at?  Well, we start with the work climate. Social scientists have been looking at work climates for many years and have demonstrated the effects of attitudes on certain work outcomes.

It was a revelation to me that we could actually understand the impact of the operating strategy, the structures, the managing practices and how we make decisions by examining the perceptions, feelings and behaviours of staff at every level of the organisation. The data provided a deep insight into the disconnects and misalignment of management thinking and pointed to alternative better approaches.

An adaptive trusting climate drives collaboration. Everybody thinks you can put people into a room, have them band together to solve a problem and that’s collaboration.  It’s not.  Collaboration is all about reciprocity.  Do you trust me and can I trust you?  If so, we’ll get along and be able to collaborate as long as we are connected to the real needs of customers.

An adaptive work climate needs to focus on ‘engaging’- how we understand the deep needs of customers, Learning- how we collaborate end to end to meet customer needs, ‘Leading’- how we devolve decision making to the point of interaction with the customer and lastly ‘improving’ – do staff have the authority and the methods to change how work is delivered to customers to meet their needs.

Is there good leadership? A challenging environment?, Enough freedom and decision making?  Do we share intelligence within our team? Within our function?  When do we see our senior management?  All of this gives rise to the work climate.

Work climate is entirely different to culture.  A culture takes a long time to establish, but once ingrained, proves very difficult to shift. The twist is that all cultures start off as a work climate that have sustained for a long periods of time.

Work climates can change very rapidly. There could be a good climate in an organization but when a new manager enters the mix with a strict focus on the numbers restricting freedom and locks everything down the climate changes rapidly but has the culture of the organization changed?  Probably not.

But if that manager keeps going like that for a sufficient length of time, it becomes ‘the way we work around here’.  So the toughest challenge for Adaptive transformations is changing the climate long enough so it becomes the culture.

It could be a toxic climate or a really productive climate but the secret to creating and maintaining an adaptive climate is management trustworthiness – can staff trust you?

Building trust between managers and staff is the path to real Adaptive organizations. Trust allows freedom, choice and the power to do what matters for customers through the willing contribution of staff and managers alike.

Stop trying to change cultures and start trying to change climates.

Leader vs. manager

Differences between managers and leaders crucial

Reading a resume can be fascinating. When I peruse a manager’s resume, it tells a story of what they’ve done. Intriguingly, a change-maker’s resume tells of what they can create.

A leader’s resume tells of what they can create and how they can achieve that through people.

Leader vs. manager

The manager’s resume looks back while the      leader’s always looks forward to creating            possibilities. It is this ability to create where others fail that makes a leader.

It’s not always easy to be the leader. Some will look  at a prospective plan and mutter disapproval   noting that a similar one had failed in the past.         Leaders brush aside those concerns conceding         that there were issues with the execution in the  past but none that preclude a new attempt. As  well, leaders learn from past failures, looking at  them as test runs for future efforts.

Leadership is the art of possibility in the face of reality. Having the ability to see the reality, the courage to talk about the reality, and the straightforwardness to point out the hard reality that the activities we’re doing are moving us away from our core purpose as a business, takes courage, tenacity and honesty.

Let’s not let the past dictate the future. Let’s create a new future, a new possibility that tells us how we need to act now, not act tomorrow. Acting now, from this moment.

This is not about blind commitment. Rather, it’s an eyes wide open commitment to facts, continual learning and tackling new challenges. This is about having a clear vision of the purpose and steps you will take. About being open to the possibility of changing the route you will take. These are the change maker’s leadership skills, the ones you would list on your resume: about how you can create possibilities.

Implementing lean

In your interviews for new positions, you talk about what the situation was, what the reality was, what the difficulties were, what the mind-sets and mental models of the organizations were, and the politics. You’ll detail for those people sitting across from you how through conversations with your contemporaries, by getting into their world and co-creating a way out. That by gaining commitment from yourself and others to forge that way out, you did so in a deft, flexible and adaptive manner, not a dogmatic way.

These are the stories of the change maker. These are the stories of the leader.

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Choosing purpose and working on it very different

Choosing your core purpose and working on it are two different things.

Having gone through the process of finding your purpose, the next step is to develop a strategy for working on it.

By doing so, you’re also exposing yourself to opportunities to learn other things in case you’ve chosen the wrong purpose. It may also reinforce the purpose you’ve selected. Your chosen purpose will tell you when you’re off course so you can restore things back to their proper place.

world-map-person-with-open-arms_MkJbHNu_But having a purpose is not enough. We need to measure our progress towards purpose.

The CORE profile shows you where you’re spending your time. Thats one measure of focus. Its also one measure of adaptability when we look at the opportunities that life presents when exploring them.

Do you know what you’re trying to achieve?

The measurement of purposefulness means do you measure the means to meet your purpose? How do i measure the means to achieve my purpose?

The measurement of means are good indicators of whether you’ll achieve something. These are indicators that you’re on track, on the right course.

It is not the objective. Measure the means not the ouput, and you’ll receive the output.

So where are you spending your time? Are you achieving your purpose or somebody else’s purpose.?

What does it feel like working on your purpose? Is it satisfying or extremely frustrating?

You have to create a purposeful climate for yourself. Understand that everything is aligned to get you the balance that you need to achieve your purpose.

Its not a sprint: it’s a marathon. But very often people run a marathon like it is a sprint and they get burned out and frustrated and injured far too early.

Create around you the conditions necessary for you to achieve your purpose in terms of what you read, how you relax, where you spend your vacations.

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You have a number of roles in your life to create your purpose. You may need to have many sub-purposes but be sure that they all align to meet your main purpose.

Identifying the purpose, measuring the means to your purpose, focusing your effort and time on the purpose and being open to change while you do it, creates a purposeful climate around you.

Then you will achieve purposeful outcomes.

New forms of adaptive organisational workforces: Faster adaptability is the new core competency in the new economy

The following is a transcription from my recent presentation at 15th International Conference on Technology, Policy and Innovation.

The programme was titled: New forms of adaptive organisational workforces: Faster adaptability is the new core competency in the new economy

Above you will find the corresponding slides. Below I’ve also posted the audio.

If you are interested in having me speak at your conference take a quick look at my topics and let’s talk.


Parry presenting 12My background is in improving organizations, designing organizations.  But my background fundamentally is in engineering, tech, IT and he school of Lean as well.  So I have a deep-rooted history working within lean.

I’m running my own business called Lloyd Parry which consults businesses on how to make them much more adaptable to the environment that they’re working in.  And we do that by investing in the people, but also advising HR on the best reward and recognition systems, the best way to manage processes and even who should be designing the organization.

The work that we’re doing is saying it certainly should not be managers that do the designing of the organization.

But what problem are we trying to solve? I get lots of calls from companies these days about the amount of discontinuous change with technologies, the skills people have, and the way organizations have to connect to other organizations, even for temporary purposes. The whole notion of a nice solid value stream is long gone.

What are the implications of this for management, staff, and the work design?  They’re massive.  And I’m getting calls from companies unable to keep up with the pace of change.

Around 2002 I was working with a high-tech outsourcing company, and getting some breakthrough with some of the Lean things that I was doing.  My work came to the attention of a man doing some work for the London School of Economics.

He went on to do research in work psychology at Aston Business School in Birmingham. He’s currently at Warrick University these days. What he found when he was doing this work for the London School of Economics was that by taking some of the philosophies and approach to people embedded and implicit in Lean and Agile these days, you do get better performance.  But unfortunately Lean isn’t known as much for creating an adaptive organization as much as creating better processes: Leaner processes and a huge fixation on waste.

Lean is really about fixation on the customer and value and empowering staff to continuously focus on that.  It’s an on-demand, continuous system but very often businesses settle for far less by just improving a few processes.  That’s great, but there’s so much more potential.

I wanted to know why I was getting more out of my staff than other people who had gone Lean.  And these guys gave me the clue.  What it did was identify the specific work I was doing that was making a difference and the work that wasn’t making any impact at all.

An organizational transformation in Lean typically took about four years with benefits during that entire time.  But now my organization transformation process is down to eighteen months because we use now a diagnostic based on behavior.  And that’s what I want to talk about today because it has implications for how we design, build and operate organizations going forward. This isn’t just for IT organizations: we’ve done this for police forces and notably, local government.

What is this behaviour-focused diagnostic looking at?  Well, we start with  something that we call the work climate. Social scientists have been looking at work climates for many years and have demonstrated the effects of attitudes on certain work outcomes.  So it was a revelation to me that we could actually look at the impact of the operating strategy, the structures, the managing practices, how we make decisions.  The perceptions and feelings of people feed through all of this so it’s a good place for us to get some information and then try and decipher the specific attitudes, how they were brought about and how we can change them.

So what is a climate? If you have an organization where there’s high levels of trust between staff, between departments, you get  collaboration.  Collaboration only comes from a mutual respect and the trust.  Everybody thinks you can put people into a room, get them solving a problem together and that’s collaboration.  It’s not.  It’s all about reciprocity.  Do you trust me and I trust you?  If so, we’ll get along and get good collaboration.

A climate can be made up of these things.  Is there good leadership?  Is it a challenging environment?  Is there enough freedom and decision making?  Do we share intelligence within our team, within our function?  When do we see our senior management?  All of this gives rise to the work climate.  And we can check that.

The good thing about the survey is that we can check it at more than just the work group level. There’s the weather on the ground but there’s weather at different levels.  So we can stratify the readings to find out what the weather is like at the top of the organization.  Sometimes the leaders are in the bright sunshine and everything’s great, but when you go down to the staff, there’s lots of rain and lots of stuff is coming down.  So we can find out where the disconnect is in the hierarchy as well.

This gave us a very great insight.  The thing is, I’m talking about a work climate and this is entirely different than a culture.  A culture is difficult, takes a long time to establish, but once ingrained, proves very difficult to shift. The twist is that all cultures start off as a work climate that has sustained for a period of time.

Work climates can change very rapidly.  There could be a good climate in an organization but when a new manager enters the mix with a strict focus on the numbers  there’s no freedom: everythings locked up.  The climate has changed but has the culture of the organization changed?  Probably not.

But if that manager keeps going like that for a sufficient length of time, it becomes ‘the way we work around here’.  So the toughest challenge for Lean and Agile transformations is changing the climate long enough so it becomes the culture.

It could be a hot climate or a really nice climate.  The biggest thing at the epicenter of this is trustworthiness.  Building trust between managers and staff fundamentally help Lean and Agile organizations, but it is absolutely a priority for adaptive organizations as we will see.  If there’s no trust, you will not get adaptive organizations or certainly not ones with any longevity.

So, in our ten years of work, we had all of these dimensions and our problem was that, yes: we could see the links, but how do we present this to a manager or a CEO or a CIO in a way that they can easily comprehend? We found we had 160 dimensions that we had to break down into four that most managers could wrap their heads around.

We have to examine how we engage with our customers and the outside world.  How do we gather that knowledge, institutionalize it, then bring it into the organization?  How do we learn from it and share it right across the end-to-end business and not just keep it in one little function?  How do we share this information we’ve got from the outside with our senior management?  What mechanisms do we have for that?  These are the things that we are looking for.

Once we’ve shared that information we need to make some decisions about it.  Who is making the leadership decisions?  In Lean and Adaptive organizations such decision making is way, way down in the organization.  Gone are the days where you have to move decisions up to the top.  We all know that.  Yet we continue making organizations where decisions flow down from the top.  But Lean fundamentally changes who makes those decisions. There are new controls that come in place and they’re mostly social controls as we will see.

Then we move from having made the right decisions to questions about ‘how are we going to improve’ and ‘what are going to improve’?  And that is the life cycle of an adaptive organization. So when we run the survey, we are looking for how those four dimensions are carried out in an organization.

What we anticipated in our early survey was that there was going to be a mass production model and a Lean adaptive model.  We were wrong.  There were two very stable ones in between as I’ll explain.

All companies are adaptive to a certain extent.  They have to be.  But today you have to have new forms of adaptability where we’re not talking about continuous improvement any longer.  We have to have continuous change.  Why?  Because as soon as I’ve installed something it’s not about optimizing it, because I’ve got to change it again.  So it’s install, get it stable, then it’s destruct and then reconstruct something else.

So how do we get continuous change?

Let me lead you into this very gently.  I just picked out a couple of things to illustrate the different ways different organizations approach these aspects.  Engaging.  Does the job design allow staff to engage with customers or not?  Is everything locked up, and you have to ask permission? The levels of trust and control can vary quite a bit.

If that is engaging, what do we mean by learning?  Basically, you know, front line staff share information about what’s going on in the real world with senior managers.  Just think about that.  In small organizations they do that.  Small software development companies, they do that.  But once you’re over a certain size, the top guys stare from the top.  They’re not connected to the operation and they’re not connected to the information that’s coming in about their customers.  Do they routinely collaborate and problem solve with senior and mid managers?  Very rarely.

Is the management focus to simply get the biggest bang for the buck, or is it on problem solving, creativity, facilitate and collaboration? Those are two different perspectives and your reward and recognition systems will also support that.  A promotion is given if staff do one more than the other.  If you reach your targets in employee utilization, cost reduction and work intensification, you get promoted.  Such a culture is sustained through the measurement system.

Do we look at end-to-end effectiveness or just functional efficiency? Do they even know where the rest of the business goes?  Adaptive organizations need people to be able to look at everything.

I’ve detailed four organizational archetypes. There is the mass production organization, which I’ve characterized as a bus in that its all batch and queue.  Then you have a more modern form of that which is mass customization much like the previous model but with some options.

Then I move up into mass specializations, networks of teams, high specialists that we’re integrating and it’s a bit like a very good department store.  You have to go around the different departments. Those people know everything, but you have to do the integration right up the mass adaptation which I couldn’t find a name for. So I called it customer value enterprise.

This is what we found out from the research. There are different characteristics for all of these.  The offerings these companies offer are very different.  I’ll just illustrate from the bottom to the top.  Low variety in manufacturing.  Generally some options, compared to individualized, bespoke, unique, flexible offerings. What’s the customer experience like?  Well, we’ve got high co-creation of the solution design.  Here, it’s transactional and processed.

Who improves things? Here, it is the people who are doing the work, that are doing improvement.  There’s no separation.  And you can see the management focus.  But, the thing that drives this is the question of ‘on what basis do I want to compete’?  Economies of scale, low margins?  A trusted advisor, an expert, going for integrations? For knowledge work, and if you’re in software development, you need to be up there. If the world is changing rapidly, then you need to be up there.  If it’s not, and it’s going to be stable, even in an unstable world that your business is quite stable, then this is fine.

So you have a choice going forward about which operating model you need to take. Here is the result of a large, global IT organization of about 2,000 people.  We took engaging, learning, leading and improving.  And from the survey we found out it was a predominantly mass production model.

So what we found from this organization a major well-known software company, is that that was how they designed the work and that was the perception of their people. Yet they have good engagement stuff with their customers but they were only in a reactive mode.

Eighteen months later we had a complete shift from all 2,000 people and their perception of what it’s like to work there. Being able to surface problems without fear and further, actively seeking problems.  And when the reports were green for a long enough time, we turned them all red to raise the standard. That was normal.

When the outside environment changed and their customer needs were changed, the staff would change the staff measurement system. They would tell the HR Department , “That’s what you should be measuring us on now.  That’s what you should be rewarding us for.”  Very different.  So it was the customer with the staff that was driving the change in the organization.

I’m working with a number of large organizations.  This company, Amadeus, provides lots of software applications and platforms for most of the European and Middle East airlines.  They’re having to change their ways from the technical silos to everything working end-to-end.  To that end, they’ve actually changed their whole operating model to do that.  So they have end-to-end business, they measure end-to-end.  The rewards are on collaboration. The senior managers do not make the day-to-day operating decisions anymore.

It is not even the middle managers leading.  It is the first line management.  Middle management are talking about making sure that they’re not overburdened, but the basic improvement and the change is day-to-day built in at the front line level.

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Moderator:  Any questions?

Female:  You showed us the software company that you worked with before and after.  But also in your speech you spoke about how moving from work environment to culture takes time.  Have you actually measured how long it took?

Stephen:  That’s a thousand dollar question.  Culture takes time.  I probably need to go back in five years, but what we’ve done is fundamentally change the reward and recognition system.  We’ve found those are the things that sustain whatever models are in place.  What staff value here has changed.  So the trick is, is to make sure that the governance structures that reinforce that old work view are dismantled as quickly as possible and get something else in.

But only time will tell.  If a new manager, a command and control manager comes in there and says, “All of this is out,” well, he’s got a big job to undo it.  But it’s still possible.  But I don’t think the staff would let them go back.