Musings of an Analyst

In my career thus far, I have gotten the experience working in a number of different organizations and a number of different organizational constructs. I have learned lessons from each. Recently, I have been reflecting on how to organize those lessons and how to apply them to enable better outcomes.

As I have thought about why organizations work the way they work, I often come back to the quote from W. Edwards Deming that said, “Every system is perfectly designed to get the result that it does.” When I reflect on this idea from Dr. Deming, I inevitably include reflecting on the partner thought of his that “A bad system will beat a good person every time.” Those two ideas prompt me to think about where the results are driven by the system and the organization and where they are driven by actions (or inactions) of individuals. It is often difficult for me personally to be confident on whether it is the system or the actions of individuals in the system that are responsible for the realized outcome.

As organizations get bigger, my opinion, based on my personal lived experience, is that the outcomes increasingly get shaped by the system within which individuals are working. While I believe that individuals can make a pronounced difference for good or for bad in the performance of the system, I have also come to believe that the structure of the system and the nature of the construct within which those individuals work increasingly becomes the dominant factor determining whether endeavors are successful or not. My personal experience is that it becomes increasingly important to consider when it is important to reshape the system itself as the system considerations come to be the factors that define the outcome.

Sensing that the system may be perfectly designed to get the results it does and believing that the system may need to be redesigned to get different results is not the same as it being easy to change the system to achieve different results. Amongst his pointed comments, Hyman Rickover is quoted as saying “If you’re going to sin, sin against God, not the bureaucracy; God will forgive you but the bureaucracy won’t.” His colorful history is a testament to Deming’s ideas about changing the system to change the outcomes. It is also a testament to the personal risk that can result from “sinning against the bureaucracy.”

For large organizations with less than desired results, that often sets up a difficult dynamic. The only way to achieve the goal is for the system to change. But, the system often resists change. History books and various journals of management science are full of profiles of successful ventures that have a difficult time adapting when the environment around them changes and the “system” they are in is not able to generate the desired outcomes in the new environment. Rome, the big three automotive companies during the financial panic, Xerox, PanAm, Nokia, and others have all been profiled as examples of various challenges. Whether it is John Kotter’s change model, applying the lean practice of defining the “is condition” and then defining the target state, or simply embracing the idea attributed to JP Morgan that “The first step towards getting somewhere is to decide that you are not going to stay where you are,” I believe the first step is always to realize that change is needed. In some cases, like Rickover’s, the system may not be receptive. In some cases, it doesn’t end well for the change agents seeking to enable the change needed to enable the change in results. But, I personally believe that deciding that you are not going to stay where you are is the first step to change. I believe that the second step in a large organization needs to be finding like-minded folks to partner with to work on change, but the first step is always to realize that the “is condition” isn’t where you want to be. Kotter showed that there are substantial pitfalls from trying to implement a change before a sufficiently large contingent of the organization understands that there is a need for a change. To circle back to the Deming, do enough people understand that the outcomes are the result of a system that was perfectly designed (intentionally or unintentionally) to get exactly the outcomes it is getting? Until people understand that idea, the “bad” system will continue to defeat good people. And trying to change the system before people understand Deming’s ideas that the outcomes are the result of the system has the potential of being viewed as “sinning against the bureaucracy.”