Everything changes, nothing stays the same. For me, it is on to the next phase of blogging. Now powered by Wordpress and with my own domain name.
Continued comment, observation, opinion and prediction on the business of information but in a new place.
From September 2011 it will be http://decisionhacker.com/
See you there.
BI, Facebook and Decision Loops
I was at an analysts briefing event with IBM last week who were sharing their thinking on Social Business and what I believe is the inspired and innovative pairing of Connections Collaboration and Cognos Business Intelligence. IBM’s Social Business Leader for Northern Europe, Jon Mell shared a slide that compared the number of operations it takes to share a photo and gather feedback with friends on facebook and the number of operations it takes to do the same on email.
This set my mind racing. If there are efficiency gains on something simple like sharing and getting feedback on a photo, imagine the productivity gains on sharing critical business information through Business Intelligence reports.
Why do I say this? Because sharing a photo is typically a single ‘sharing loop’ process. Someone publishes the photo, others contribute with their clever and witty observations. Done. A single loop. Count ‘em. One. (A quote from Muppet Treasure Island, btw)
The out-dated view of BI is that it is shared this way too. That it’s published and the job is done. This just doesn’t hold true any more and I am not sure it ever did. BI requires many sharing loops. Ten, distinct loops to be precise;
That’s ten loops which means that if sharing a photograph on Facebook is more efficient than sharing it in the office using email, the productivity benefits of doing ‘real’ business are tenfold.
There are those that are sceptical about Facebook styled social platforms in the office because they may waste time. The opposite is true. Organisations need social platforms, particularly for collaborative decision making. Without them, they are wasting time.
Organisational decision making is my current preoccupation. After all, as BI practitioners, this is at the heart of the value we bring to an organisation. If we aren’t improving decisions then I am not sure what we’re for.
In an earlier post, I talked about trashcan theory. This is the theory that describes organisations as a collection of people aware of problems, people that are aware of solutions but unaware of the problems and people that control the allocation of money and resources but are unaware of both the problems and the solutions. Good decisions are made when problems, solutions and effort are all aligned but if these things are jumbled up (like in a trashcan) then decisions might not only be poor but they can appear to be random. This provokes those that didn’t make the decision to ask “Why did they do that?”
But good decision making needs information. Decisions without information can still be systematic. They can also be thorough with all possible outcomes discovered, debated and properly considered. Without information though, they are uninformed. In many situations experience, assumption and instinct can make a reasonable proxy for information but would you invest your own money this way? Given the choice of a well researched stock or one that a mate has a good feeling about where would you place a sum (large enough that it would hurt) of money?
This is a bold statement but there is a worrying amount of evidence to support it. Depending on the survey BI is deployed to round 8% of the organisation. Knowledge workers make up between 30% and 45% of the labour force in developed economies, more depending on the definition. Not all knowledge workers need all information, of course, but the gap is significant. The ‘intelligence gap’ isn’t going to get better either. The volume of available data is growing exponentially. Last year we all generated 1.2 zettabytes (remember when ‘tera’ equalled ‘big’?) so as we congratulate ourselves on a job well done we also have to think about what we actually need to know from all of that stuff21.
Even more worrying is that decision makers are telling us that they know they are making decisions without information. In one study (Accenture, Competing Through Analytics) the suggestion is that 40% of major business decision are being made without reference to information from analytics applications. As a BI Practitioner it’s difficult to feel good about that number.
In many cases, the information is actually available. In an earlier post, I used the UK retailer Boots (a business I have an immense amount of respect for) as an example. They launched what turned out to be hugely unprofitable ‘Wellbeing’ services because they had detected a slowdown in their core business. When they abandoned Wellbeing in favour of a return to their base beauty business they did so on the basis that their base beauty business was still growing. They absolutely, positively had that data all along. It was just disconnected from the decision.
To say ‘just’ disconnected is to diminish the importance though. The emerging use of social business tools in organisations is going to make it possible, for the first time, to join up the decision making process and the information that informed it. It’s a tiny connection that can have a profound impact on the quality of decisions. That one single connection will make the decision more transparent, more open and more accountable in a way that the decision makers may need to think again and possibly even make a better decision.
There it is. Better decisions.
Meetings are one of the most common decision making ‘forums’ we are all regularly involved in. In fact one in five company meetings we take is to make a decision. As a way of making decisions though, they can be problematic. Once the meeting has concluded, the connection between information shared, decisions made and actions taken can be weak even lost. It’s as if the meeting itself were a decision making black hole.
Some decision making meetings are impromptu for making a timely, tactical decision quickly. Others are regular, formal and arranged around the ‘drum beat’ or ‘cadence’ of a business to make more strategic decisions. The more strategic the decisions and longer term the impact the less frequent the forum so a Senior or Executive Management Team may only meet quarterly for a business review (QBR)
A typical QBR will see Senior Managers sharing results in PowerPoint, possibly with financial results in spread-sheets which I would hope have at least been extracted from a Business Intelligence application.
If the SMT are reasonably well organised, they will summarise their conclusions and actions in meeting minutes. The meeting minutes will be typed up by an assistant in a word document and then distributed in email.
Throughout, they will all have been keeping individual notes so will walk out with these in their daybooks. The most senior manager in the room might not do this particularly if it’s their assistant who’s taking the minutes.
Later, actions from daybooks and minutes are likely transferred to individuals to-do lists and all follow-up will be conducted in email and phone calls.
So let’s recap. Critical decisions about how resources are going to be allocated will be discussed in a ‘QBR’ and yet the artefacts of this critical decision making forum are scattered into Word documents, excel spread-sheets, emails and outlook tasks. Tiny fragments of the discussion, information, conclusion, decisions and activities implode around the organisation. To be frank, the team are now only going to make progress because the forum was recent and can be relatively easily recalled.
Of course, once time or people move on so does the corporate memory of the decision. Conversations begin with ‘what did we agree to do about that cost over-run?’ or ‘why did we say we were ok with the revenue performance in Q1?’
Many executives complain of a syndrome that feels like ADS. This is because the more senior the manager the more things they will probably have to deal with at an increasingly superficial level. A functional head will probably spend no more than 15 minutes on any one thing. To productively make decisions they will need to be able to have the background, status and related information to hand so that they can deal with it quickly and move on to the next thing. Decision making black holes contribute to this feeling of EADS.
Corporate Decision Making platforms will be successful when they connect;
This means total recall of corporate decisions good and bad so that, over time, decisions can be recalled, evaluated, re-used or improved. A far cry from current decision making forums which whilst functional are inherently flawed, fragmented and are not improving the timeliness and quality of decisions in our organisations.
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| Home of the Paradox |
Abilene, Texas seems to be an entirely reasonable place. Jessica Simpson (Daisy to Johnny Knoxville's Luke Duke) was born there and I understand that the museums are free during their monthly Artwalk event. There is even a Country and Western song about Abilene which, last time I checked, there isn't about my home town in Surrey. It seems unfair then, that the place has a whole paradox named after it.
“Cohen contends that managing agreement is the single most pressing issue facing organisations today”
The Abilene paradox describes a particular problem with group decision making. and was introduced by a management expert, Jerry B Harvey, in his article The Abilene Paradox: The Management of Agreement.
The Long and Winding ...
In the article Jerry described something that happened when they were visiting family in Coleman Texas. The family were playing domino's on the porch and enjoying iced lemonade when Jerry's father-in-law suggests that they take a trip to Abilene, some 53 miles north, for dinner.
It was over a 100 degrees outside and Jerry really didn't like the idea of a 106 mile round trip in an old Buick without air conditioning but Jerry’s wife responded before he had time to say anything with, "Sounds like a great idea. Jerry felt out of step but thought he might still avoid it by adding ‘Sounds good to me … if your mother wants to go’. However, Jerry’s mother-in-law then says, "Of course I want to go. I haven't been to Abilene in a long time".
So, they were set. The drive is hot, dusty, and long. When they arrive at the cafeteria, the food is is less than average. They arrive back home four hours later, exhausted.
The Game of Recrimination
To be sociable and break the silence as they are cooling down after the ride, Jerry says ‘It was a great trip, wasn’t it’ Jerry’s mother-in-law says that, actually, she would rather have stayed home, but went along since the other three were so enthusiastic.
Jerry’s wife says, "I just went along to keep you happy. I would have had to be crazy to want to go out in the heat like that." Jerry’s father-in-law then says that he only suggested it because he thought the others might be bored.
The group then did what all groups do in these situations, they played the game of recrimination. No prizes, none of the time. When they couldn't identify a suitable culprit they sat back, puzzled and perplexed as to why they all decided to take a trip which none of them wanted to. They would actually all have preferred to stay on the porch and relax.
We tend to think that the biggest challenge in organisational decision making is managing conflict but what the Abilene paradox describes is the difficulty in managing agreement. I’ll say that again … not managing conflict but dealing with decisions when we agree. It's absurd but then again, that is exactly what a paradox is.
There is no shortage of material that try and make sense of why good people and great businesses make monumentally bad decisions. In the book 'Thing Again:Why Good Leaders Make Bad Decisions' by Sydney Finkelstein, Jo Whitehead and Andrew Cambell the focus is on the strategic decisions that have dramatic and highly visible consequences for the organisation.
An example is one of the UK's premier retailers Boots which enjoys one of the largest footfalls in the UK. Established in the 19th century, it is now a subsidiary of £20billion Alliance Boots. In September 1998, the Chief Executive, Steve Russell excitedly announced a range of healthcare offerings including dentistry, chiropody and laser hair removal. Five years later, the initiative had lost in the region of £100m and Boots needed to break open the piggy bank and look down the back of the sofa for another £50m just to close down the operation and convert that premier retail space back to being ... retail. It almost goes without saying that the changes were implemented by a new CEO, Richard Baker.
Apparently, one of the chief reasons for making the move into Healthcare services was that a slowdown in the Beauty business 'had been detected'. However a spokesman was later quoted in the Telegraph as saying that 'they recognised that these areas are still growing strongly'.
Let's stop there for a second. Spotting trends in sales and revenue by product category is probably marketing and business 101. And even the most rudimentary business intelligence solution should be trending sales over time. Yet the trend in sales in a key category for Boots was diagnosed as slowdown and only a few months later as growth. Of course, the slowdown may have been a short-term blip but the point of trending is to smooth these out for the purpose of longer-term planning. And, the error in trending might be more understandable had it not been for the fact that the later growth was characterised as 'strong'.
Of course, I am not on the board of Boots and I have an advantage shared with all those analysts and commentator that put the boot (or should that be Boots) into Mr Russell ... hindsight. Indeed, it's a testimony to the strength of Boots as a high street giant that they can make major booboo's and still go on to survive and thrive.
And organisations are complex systems of individuals and interactions. Large organisations are very complex. This is why organisational decision making doesn't always stand up to the scrutiny of us as individuals who retrospectively try and apply the logic of rational decision making to such mistakes.
However, what my own experience tells me is that information is all too often disconnected from the decision.
