Organizations and the Laws of Physics

I am writing this article to create an imbalance in the world of those who read my posts. I am not in any way attempting to consider all of the options, or to be fair.  I just want to Step on your t pets a little. If it makes you uncomfortable, that is a good thing.  It is what this article is meant to do.

Newton’s Second Law of motion, in paraphrase, states that to change the state of motion of an object, a force must act on it to create an imbalance in forces. The object will then move to establish a new state of equilibrium.

The second law of thermodynamics, in paraphrase, states that systems always move toward a state of equilibrium. This movement will persist until the system reaches absolute zero (system death) or equilibrium is reached.

These concepts taken from physics also apply to human endeavors at the individual and organizational levels. In the human experience we call equilibrium the “status quo”.  I personally find that the status quo is a place for those who need rest or are not motivated to move forward. I am not against rest, but if you are resting and your competition isn’t, you’re losing ground. In other words, the status quo for me is good only when the status quo is to avoid the status quo.  Chew on that one for a while.

The status quo mentality usually forms in organizations and individuals who are internally focused. Being internally focused will isolate you from your external operating environment. You do not feel, or you fail to recognize, external forces that create imbalances in your external operating environment. The result is that you become out of alignment with the world around you. You fail to benefit from changes in the environment or maybe you even fall victim to them. The ostrich may have protected his head, but his rear end is more than a little exposed.

I know that some will say that organizations and individuals must isolate themselves from destructive forces in their operating environment in order to protect their assets.  I will answer that I disagree. Individuals or organizations that do not try to manage within the environment they operate in are simply exchanging one master (the larger outside world) for another (isolation). We do not have to be mastered by either. We control our choices and we become stronger and more robust as we exercise our ability to choose.

Let me give you examples. Governments and businesses isolate themselves from the governed and customers with bureaucratic layers of management. Religions do this by operating on a paradigm of exclusion (us, them) instead of a paradigm of inclusion. The result is that some governments, businesses and religions become more and more isolated, lose connection with their sense of purpose and eventually fail.

So what do you do? First understand that nothing stays the same in our world.  We age, tastes change and the people around us change. There is an interesting story line in the movie “The Time Machine”. The time traveler sits in his time machine and watches the world change around him.  He is isolated from the effects of the change and when he arrives in the future he is out of place and out of sync with the world around him.  The world experienced the changes first hand and has adapted, he did not experience the changes and finds himself in danger without a full understanding of how to cope. In the movie the good guys win, but in real life it probably would not have turned out that way.

We don’t have to agree with, or placidly accept, the changes around us. We can push back, adjust our strategy, etc. What we cannot do is ignore what is happening. The wise person evaluates these changes against reality and avoids letting others interpret their meanings for them. In sports we call this “keeping on your toes” or “keeping you eye on the ball.” In life it is simply a matter of paying attention to what is happening around us and keeping the main thing, the main thing.

In short we must embrace change. The world is moving onward with a great deal of inertia and it doesn’t care if you get left behind. The days of large stable bureaucratically ran organizations are coming to an end.  These are the days of smaller, fast and flexible, organizations that can move quickly to take care of customers, no matter how the environment changes. What customers, and people in general, want are solution providers, not protestors or clingers on to the old paradigm.

One way to manage this is to balance long term projects, goals and rewards with short term projects, goals and rewards. The long term perspective tends to add stability to an organization’s progress over time.  The short term perspective creates more employee engagement and a degree of instability, which is also good. Short term projects, goals and rewards operate in the current reality and force us to see what is actually happening right now. Long term projects, goals and rewards keep us focused on our mission and vision, which may be based in another reality. Short and long term efforts tend to modify each other in a healthy way when managed properly.

The balance point is always shifting.  Don’t let it become a tripping point.

Organizational Re-design

In organizational re-design, there are changes to process, infrastructure and procedure. These are impersonal and structural in nature. They are also, by the way, the easiest things to modify when re-engineering an organization.

Just as important, but much more difficult to deal with, are behavioral changes. The best business process that has ever been designed will not work if the underlying user behaviors are not also changed.

The same is true in transactional processes such as sales. For example, you can design and build a totally green house, but can you change consumer behavior enough to get people to choose to live in it?

What this means is that we must value human behavior expertise as highly as we do technical expertise. The philosophy of “If we build it, they will come” only applies if you build something that the consumer or employee see as valuable.

The point is that you must listen to the “voice of the customer”. The customer can be an employee or someone who pays you for a product or service. It also represents a strategy of change management and innovation. That is, address human behavior issues before technology issues. The truth is that if you build it, they may not come.

Sometimes when we change human behavior first, the users themselves change the process in the direction you were trying to achieve. You may even find that change was not necessary or that your ideas for change were faulty.  This applies to all aspects of a capitalistic culture. Consumer demand drives technological innovation and cultural values drive cultural change.

Customer Focus, From Lean and Mean Process Improvement

Two aspects of customer satisfaction affect every business: satisfaction with the process output and satisfaction with the service surrounding it. In the service industry, businesses understand that providing quality service is a key to customer satisfaction. At the same time, though, they must have concern about the service product. For example, consider receiving exceptional customer service from an associate at a retail outlet, only to find the selection of merchandise too limited. The result is that you may choose a different retail outlet on your next shopping trip.

Conversely, what happens when you receive very bad customer service at a different retail outlet, which happens to have a very wide selection of merchandise? Even though you can find what you need, you will probably decide not to do business with them in the future.

Many product manufacturers miss this connection as well. An edge in technology or functionality gives a competitive advantage in the market place. Although this physical advantage is important, if the quality of service provided to the customer is poor, it will likely negate the advantage. For example, you would probably not rush to purchase a technically superior automobile from a supplier known for poor service after the sale.

To summarize, in order to improve customer satisfaction in a meaningful way, the business needs to distinguish between the process that provides the service and the process that provides the product. Without this distinction, it is easy to blame defects on the wrong process, or to fail to recognize that the other process exists.

Specifically, the service industry must recognize that their customers see a product component associated with the service they receive, while the manufacturing industry must recognize that their customers see a service component associated with the product they receive.