5.01.2010 - Consuming Innovations

Happy New Year from Critical Difference!

Keep checking the website here for radical changes and new opportunities for businesses to overcome performance barriers.

Innovations: Some did, some didn't -from 2009

Flop of the Year: Nine with Daniel Day Lewis and many other worthies –warbling a load of showstoppers to help the director (= God) recover his muse. Songs in the key of ego! However the best film that evening was a 2 minute Virgin-funded film publicising new talent, called ‘eyebrows’. This set out to show that the emotional power of any scene was less in the eyes than in the eyebrows! There was more wit in this than in the entire conceptual clumsiness of Nine.   

Joke of the year: The Stella Artois Hedge Fund! Through the holiday period many supermarkets and off licences soled packs of Stella Artois (10 x 25oml bottles) with eye-catching packaging. ‘Hedge Fund’ was loudly blazoned on the side, saying ‘If you buy this pack we’ll grow a hedge in the British countryside.’ For every pack you buy Stella will invest in a real Hedge Fund and grow a hedge 6 times the size of this pack! There is also a great picture of two 1950s advertising exec look-alikes giving a hedge a manicure! What next –gloves to warm up socially deprived bankers?

Best live theatre: coming back slightly late to the second half of ‘Cat on a Hot Tin Roof’, at the Novello, when the whole seated row (tiny seats) had to stand up to let me in, a Nigerian man said to me ‘You’re getting a standing ovation’ and as I went past him ‘…though I can’t think why..’

Innovation for 2010: next time the banks get in trouble, let them fail!

Check out the blog and website for more on Business Models (the continuing new Nirvana) and how to develop a Business Planning Bypass to get to (your) market quicker.

All best for 2010 and keep innovating! 

24.12.2009 - Say Yes to NAO

Say ‘Yes’ to NAO (National Audit Office)

So the Department of Business, Innovation and Skills want to fund only education that is employer responsive and economically relevant. If this is a change of policy we should ask what has been learned from what has gone before –including what the Government needs to learn.

What can we tell from these two illustrations? 
In 2000, the Phoenix 4, a consortium of businessmen, bought MG Rover from BMW for £10 and managed it till it became bankrupt in April 2005. A report in September 2009, stated that the company had pursued to its logical conclusion certain business habits including: maximising short term personal gain; avoid paying tax; hiding poor performance in a web of technical complexity; seeking exorbitant remuneration while avoiding personal accountability; seeing the main stakeholders as themselves.
What had these business men learned: that none of this was considered bad practice in the world of business and finance. (Guardian 13/9/09) So what did the Government learn? And how should business education counter this?

In November 2009 a National Audit Office (NAO) report revealed that Goldman Sachs (and other City banks) got more than £150m in advising the Treasury how to save banks from going bust. However, the Northern Rock bailout in 2007 cost £70m and the Treasury then signed a deal with Goldman Sachs (GS) with an ill-defined success clause which also permitted GS to keep secret how they calculated the rescue package. The NAO suggests that the Treasury should have learned that it needed to develop its own specialist staff to do this in-house, to avoid such future payments.   (Guardian 1/12/09)

So what can be learned from this?
What did the Government learn: servility? learned helplessness?
That this is a failure of the greed ideology has been well documented: that banks are too big to fail, that the best minds go into finance, that markets know best, that financial innovation is socially useful, that managers without a moral compass should be free to self regulate.

However, we now know that something else needs to be included: that ‘return on investment’ needs two columns: the benefits of learning and the cost of not learning.
Further, I wonder what financial managers could learn from a good public sector manager?

2.11.2009 - The new bling and the oldest profession (als)

The new bling and oldest profession (als)

Last week I was invited to a ‘Social Innovation Forum’ where ‘Camelot’ sought to generate ideas to better ‘engage their stakeholders’. It was organised by YouGovStone, an online market research agency and London’s leading network organiser. They gathered around 50 ‘opinion formers’ (us) unpaid, offering free breakfast, a bottle of champagne and unlimited networking. As an innovation forum it was successful, generating over one thousand ideas.
 
The age range was around 40-60 and (with, I guess, few of us actually using Camelot’s services). The event organiser said that in terms of cultural capital, us ‘professionals’ with our awareness, experience, knowledge and willingness to share, are the new bling!

So how do we wear our bling?
Nice idea to see us as new ostentatious wealth but is that accurate? Much of my consultancy work consists of experienced staff –ie ‘professionals’ resisting change –in some cases justified, in many not. 

Here’s what I mean: 

‘little accountability… poor performers not removed but are moved around… brains are used brilliantly 24 hrs a day to prevent any new initiatives going forward (with no penalties for such behaviour)… the office is full of useless, oppositional 40/50 somethings who had once been highly intelligent and are now drifting listlessly and bitterly into retirement…’ Which organisation is this?  

My experience suggests an odd paradox: in many organisations there seems to be an inverse ratio between experience and excellence –that is, length of service (and resultant experience) does not mean better performance. Commonly the opposite.

What are the characteristics of modern professional working? Clearly, not all ‘professions’ are the same -bankers, auditors, estate agents, teachers, solicitors. But then not all professions have the same status and many ensure limited access to them by using a mirroring process: ‘you’re can enter only if you’re like us’.

At an individual level, many professionals want neither to be led nor to be leaders. They are concerned with defending their own interests as a group, and their ‘expertness’, their holy ground, making them the sole traders of their ‘subject’. This cuts right across the interdependence organisations require so they can create value for customers and colleagues for better, more effective, efficient working. The inward-facing loyalty many professionals have to their ‘subject’, regardless of the circumstances their organisations face, means they assume the ‘freedom’ that being a professional confers without recognising its obligations. For instance, in HE, having an ‘I want to be alone’ way of working (to get on with ‘research’ that nobody needs or reads) or in FE, teachers demanding the right to select their own teaching/learning methods (didactic, teacher-centred ones they used 20 years ago). I’d better not say anything about bankers or estate agents.

This kind of ‘professionalism’ denies broader use of the change-enabling properties many professionals could bring to other areas, as organisational change agents.  It is a major barrier to improvement. In organisational terms it is learning-lite and lacks the crucial characteristic that animates the new bling -that ‘willingness to share’ across boundaries and purposes.  

Notice the ‘opinion formers’ were invited to the Camelot event not as professionals but as good networkers. But then if many of today’s ‘professionals’ were asked, they probably wouldn’t come.

23.07.2009 - Comfort, Change, the Conservatives

Comfort, Change, the Conservatives

Seen the response of the City to the Tory Party proposals to reform the financial system? A ‘sensible package’! That is, they like it. So what happened to all that talk of cutting bonuses, breaking up the megabanks, rewriting the rules of finance? More posturing than substance? And with Lehman Brothers now making profits of $38m per day ($15.8m per hour) what’s changed?

What could we learn if we looked at this issue in terms of leadership and management of change?

 
Unless change provokes discomfort -the degree depends on the size of change needed though always needs to be present in some way - then it is unlikely to work. Profound discomfort means the dawning of the realisation among those it is aimed that cannot avoid it any more and usually prompts a response of denial, offloading and libel-labelling ranging from ‘how dare they’, ‘what do they know’ and ‘what was wrong with the previous system’? At the same time some ‘internal company sweating’ needs to begin where those committed to change engage with colleagues who are not. And the arguments, contradictions and iterations of change emerge. Strangely, at this stage, even if the level of engagement is variable, it commonly has the effect of moving practice on, so that it is not possible to ‘comfortably’ go back to the old practice.
 
One indicator of change beginning to bite is when a ‘breaking point’ emerges earlier rather than later. This is when those commissioning change realise from internal feedback that, even if they have said it before they now need to say it again even more explicitly: they need to back change or back down. 

How does this square with your experiences of change?

2.07.2009 - Who Invented Consultants?

Who invented consultants?

Opening dialogue with consultant:
Consultant: What‘s it like working here?
Staff: Terrible, demoralising, nobody listens, we’re not valued.
Consultant: Anything else?
Staff: Yes, they repainted the canteen last year and didn’t consult us.
Consultant: So what do you need… greater influence, more power…?
Staff: No, we need a consultant to tell them how bad it is. 

Now how did these staff learn to be so helpless? 
This is fuel for the old question of who invented consultants. These people who ‘need’ them? That residual blamebox, ‘management’? Or everybody at work who succumbs to the idea that having created their own ‘unique’ problems, they can’t solve them. Well try harder. Or everyone pays to the tune of £115 billion a year  -the sum earned by the consultancy industry globally in 2008.

More importantly, how exactly should consultants tackle this issue?
Many consultancies use didactic, instructional methods, with the likely effect of generating dependence on them. The better ones use a learning approach -what needs to happen here for sustainable solutions –and aim to create greater thinking capacity.

However, this depends on their willingness to hold their nerve and overcome key challenges such as an initial reluctance for staff to own their problem, the associated blame storming, and then the growing of feasible new options. 

Consultants could usefully start with challenging these staff to reframe the unpromising circumstances they have created, as the beginnings of learning. Of course this means more leadership –at every level, the lack of which is a symptom anyway. 

So maybe the first new public sector efficiency is do-it-yourself. Otherwise it’s like outsourcing the company brain.