Thursday, April 03, 2014

Systems archetype: Success to the Successful


The Success to the Successful systems archetype explains how very small differences, and random factors, can lead to one actor in a system to be hugely more successful than other actors:

  • how monopolies are created
  • why income is so unevenly distributed in many countries
  • why success in the school system leads to success later in life
  • how Microsoft became dominant in the software market

...and many other phenomena. Success to the Successful provides an explanation model for the Pareto Principle, the observation that in many systems, roughly 80% of the effects come from 20% of the causes.

To understand the causal loop diagram above: Assume that you have two actors A and B. A and B compete for resources. A and B may start out being equal. That is, there may be no observable difference that would give either a competitive advantage.

As long as the system is perfectly balanced, nothing interesting happens, but, if there is a random event that either favors A, or hampers B, then A will gain an advantage over B. A can use that advantage to gain more resources. Because resources are limited, B will be starved for resources. This will mean a greater advantage for A. When the cycle repeats, A will be able to gain even more resources, and B will have less.

If the cycle is not checked, it will continue until A kills off B. In cases where A and B are interdependent for survival, A will then die too.

Examples

Two recent Youtube videos provide excellent examples of the effects of the Success to the Successful systems archetype.

The first video describes how income distribution in the United States have changed in the past few decades:

The second video shows the same income distribution phenomenon occurring in Sweden. The video is in Swedish, and I have included it mainly for my Swedish readers.

Remedies


The video above shows Warren Buffet and Bill Gates discussing a remedy to the problem of uneven income distribution. It is well worth watching.

There are two tactics that can be used to restore balance in a Success to the Successful situation:

  • Identify the resource being unequally distributed, and redistribute it more equally. For example, this is why tax scales in many countries are progressive. It has nothing to do with justice. It is a way to prevent distribution imbalances that would eventually lead to economic collapse.
  • Separate the reinforcing structures, so that they no longer are allocated resources based on their relative results. For example, when Apple was being outcompeted by Microsoft and the PC manufacturers, Apple broke into the music market with the iPod. This reduced Apple's dependency on the computer market, a system dominated by Microsoft and the PC, and allowed it to build strength in an area where there was less competition.

Review

I have asked the very nice people in the Systems Thinking in Action group at Linkedin to review this post. The comment thread is here (for group members only). I will update this article whenever someone catches me making a mistake.

References

Higher Learning Research Communications, March 2013, Volume 3, No. 1
Systemic Perspective, Vol. 4, Gene Bellinger (Out of print. Visit the Systemswiki instead.)
Business Dynamics, John Sterman

Friday, February 28, 2014

Conflict resolution - Perhaps we should be more childish!

It is natural to want to avoid conflict, but it may not be the best way. You may be surprised to learn who had the courage to stand up in the face of anger and constructively work to resolve a conflict, and who had not. (Photo: Henrik Mårtensson Yep, that's me. Model: Ida Stranne.)
You should not decide until you have heard what both have to say.
–Aristophanes, c. 446 AD – c. 386 AD
I have seen two interesting cases of conflict resolution recently, showing off two very different methods of resolving conflicts.

Even more interesting than the different approaches, is who chose which approach. Read on, you will be surprised, or maybe not.

Case 1: Scream and make up


In the first case, two people worked together on building something, but they had different ideas, and constantly got in each other's way. They took a break, and decided to go out together, to let their tempers cool off.

When they came back, the conflict had escalated to the point where they were screaming to each other, and one of them left to go home.

About ten minutes later, the person who had left came back, apologized, and said he wanted to make up and be friends again. He said he valued friendship more than the thing they had been trying to build.

It took a few minutes, but eventually, they were both talking. A few minutes after that, they continued on their project, and it worked well. Since then, the two have worked on more projects, and worked very well together.

Case 2: Repress and remove

Repressing the message by removing the messenger has short term attraction, but it does not solve the problem. It often creates new ones. The problem is that excercising power is much easier than excercising courage, good judgement, and empathy.
The second case was in a sales network team. A recruiter who used personality profiling in his work asked another team member to take the test. The idea was that if the second person took the test, he would then be comfortable acting as a sales agent for the first person.

For this example to work, I need to delve into the background first, so you understand the full consequences of the repress and remove tactic used. I am sad to say, repress and remove is as common as it is costly.

It should be noted that the recruiting agent had sold his services to more than 400 companies, and tested more than 14,000 people. The recruiter claimed that his test was an infallible way to identify top talent, the very brightest and smartest people.

In this case the second person happened to be a top performer, and according to other tests, both personality and IQ tests, friendly and a borderline genius. He was exactly the kind of person the recruiter claimed to be able to identify.

When this person took the test, he ran into some difficulties:

  • It was an ipsistic test. Ipsistic tests are designed as counseling aids. They do not yield results useful for comparing different individuals. For example, a very stupid person with little empathy could get a score that says there is a 50-50% balance between intellect and emotion, but so could a very intelligent person with high empathy. (Job applicant tests usually use the Likert scale.)
  • The test forced test takers to prioritize two different statements, without knowing the context. The test was an online questionnaire designed so you could not skip a question and continue. 
This is downright stupid. For example, "X is a letter" and "I need to breathe" are both true, but to prioritize them, you need to know context: Are you teaching a child to read and write vs. are you suffering from oxygen deprivation. 
Intelligent people do consider context! It is a hallmark of high intelligence and empathy, and yet, the test was designed to barr such people from even completing it.
To put it bluntly, to complete the test, the test taker would have to fake being less intelligent than he was, which he refused to do. (In retrospect, the test taker admitted that hiding his intelligence would have been a lot smarter.) 
Approximately a third of the questions were designed this way.
Not only was the test fake, it faked the wrong type of test!

There were more problems with the requitment method. The recruiter had a method of identifying the ideal personality profile for a particular job. What he did was to profile employees with the same or similar jobs, and then create a profile based on averages from the ipsistic test scores.

You may note there are two things wrong with this:
  • If your ideal profile is the average of what you have got, you will get more average! Real top performers will be way different from the average, and have no zero chance of passing the test, unless they are lying their way through it.
  • Computing an average score from the results of an ipsistic test is an excercise in idiocy, because ipsistic test scores are not comparable from person to person.
There were other things, like failing to make a distinction between introverts and socially selective people, which is important if you want to identify top performers. The recruiter also cited examples of customer satisfaction as evidence of the effectiveness of the method itself. This is entirely bogus. For example, an astrologer may have many satisfied clients, but astrology itself does not work.

Now we get to the interesting part:

The test taker went to the recruiter and asked why an ipsistic test was used for comparative testing. The recruiter promised to explain why, if the two could have a meeting, but then made a complaint to the team management. Exactly what the recruiter said, the test taker was never told.


The team management then used an intermediary to tell the test taker that the test taker was expelled from the team. The team management would tell the rest of the team that the test taker had decided to quit the team.

There was to be no action against the recruiter, who had fooled more than 400 companies into using a test procedure could not identify, and even excluded, the people they were looking for. More than 14,000 people tested, and misclassified by a flawed test.

Considering that finding real talent, or not doing it, can be the difference between surviving and going down in burning flames, I'd say the repress and remove tactic can have pretty devastating consequences.

Who did what?

I wish adults could act more like children: Ethical, courageous, and prone to do the right thing, even when it is difficult.
You might not be too surprised when I tell you the team management who chose the repress and remove tactic included:

  • a CEO
  • a board member
  • a management consultant specializing in investigation dysfunctional management teams.

You may be more surprised when I tell you who the two people who, despite anger and screaming, managed to do productive work and strengthen their friendship:

  • Two eight year old children playing Minecraft
I have seen a child go and make up, even though he was so afraid he was crying. Still, on his own, he made the decision to resolve the matter in the best way possible. He knew what was the right thing to do!

I wish there were more childish people in management and leadership positions. Perhaps, we would then have better ways to resolve differences, and a better future for all.

What do you think? How should we resolve workplace conflicts? What is required to make a solution effective, rather than just talk and wishfull thinking?

If you have an opinion, please do comment.

Tuesday, November 26, 2013

Thursday, May 02, 2013

Starting a New Business - the Systems Thinking Way


I am starting a new business. I am not giving up my work as a business advisor, but I do need a change of pace. Ten years of working to improve other people's businesses have taken a toll.

You might think "a change of pace" means I want to slow down. On the contrary, I want to speed up. The very, very slow, cumbersome, and obsolete systems and processes at most companies are very difficult to adapt to.

I need to do something challenging, and I need a test bed for ideas. I also happen to love photography, especially trick photography, so, I am setting up a photography business.

I am of course applying Maneuver Conflict and Systems Thinking ideas to the new business.

Here are some of the things I am doing differently from other photographers:

To succeed in business, you need to try a bit harder, and do things other people can't or won't do.
Finding a unique segment: Most photographers focus on weddings, portraiture or advertising. I focus on trick photography. It means I do something no other professional photographer in gothenburg does.
  • Lots of photographers shoot weddings. I am the only one that make the bride and groom fly, levitate, or be quite literally joined together. (You can do some amazing flesh manipulation techniques these days...)
  • Lots of photographers shoot children. I am the only one that can shrink a whole class of school children and put them in a lunch box.
  • Lots of photographers shoot products. I can make the products levitate, sparkle, etc., without an advertising agency.
  • Lots of photographers shoot portraits. Almost everyone does it using soft light and clamshell setups. I do that too, but I also offer soft light setups, hard light setups, night setups (in broad daylight)... and I can turn you into a zombie or cat creature.

Delivery: Most photographers deliver files on DVD, and framed prints. I deliver the files on USB sticks, because newer computers often do not have DVD players. I do deliver framed prints, but I also print on t-shirts, mugs, phone and tablet shells, and hundreds of other things. 

I bet people want to see, and show off, their pictures all the time, when they walk along a street, drink a cup of coffee, or pick up their phones.

My clients can order through a web form, and they can customize items themselves if they like, for example by adding or changing text, changing colors of items, and so on. I have set up a small public store to showcase 
what I can do.

Hadouken is a Japanese photo craze where you imitate Manga style fights, complete with Ki based energy attacks. Probably not what you would choose for a corporate group portrait. Then again, it might be...
Events and courses: I have started organizing photo events. The first one is a Hadouken photo event, on Saturday, 4 May. More will follow. If a special event is successful, elements from that event will be included in photography courses.

In short, I am constantly, and very consciously, looking for things I can do that will delight customers.
Will I succeed? I will if what I do is interesting enough: Interesting to customers, and interesting enough so that people will want to spread the word.

Here are links to my photography web site, and my photography blog.

Check them out. You might like them! :-)

Monday, March 11, 2013

Workshops: Values to Vision and Strategic Principles


I am announcing four workshops in Stockholm and Gothenburg.

Each workshop is limited to twelve people, and the first workshop is in just five weeks, so if you are interested in gaining an advantage over your competition, sign up now:

Stockholm:

Gothenburg:

Why should you care about having a clear vision?

A vision is a guiding light:

The vision helps you establish a connection with your customers, it attracts the right people to your company, it sets a course to follow when developing strategy and tactics.

And yet, most companies have vision statements that are bland, uninspiring, and to be frank, not very useful.

In the workshop you will learn how to build a vision guided by your own values. You will learn how to use your values and your vision to shape your mission. And, you will learn how to create a Goal Map, a simple picture that explains your vision, and the intermediate goals necessary to achieve it.

A Goal Map is a great tool for explaining your vision, and setting a course for your organization. More than that, you can use it to define the behaviors necessary for success.

Why should you care about strategic principles?

Strategy is about setting goals, and achieving them. There is a simple set of principles that are common to all kinds of strategy: In business, war, love, games.

Unfortunately, a strategy developed without understanding the principles, will often cause more harm than good. Quite often, even large companies, confuse strategy and tactics. The result is often a gigantic  Powerpoint stack, full of lofty statements and wishful thinking, but of little practical use.

The business strategy workshop will clearly define what strategy is, and give you:

  • A simple tool you can use to develop good strategies, and find the flaws in bad ones
  • Six strategic principles common to all strategy development
  • Cheng/Ch'i, a Chinese principle for developing strategies for business, war, and love
And there is more of course. Check the links above for more information.

Saturday, February 23, 2013

The Reality Dysfunction Draws Closer


The Reality Dysfunction is approaching. The picture above is the theme picture for my presentation at Lean Kanban Nordic on the 12th of Mars. I'm going for the jugular with this one...

You can read more about the presentation itself here.

Tuesday, January 29, 2013

Reality Dysfunction preview at Scrumbeers

The audience was great - Knowledgeable, asked a lot of questions, and there was a very interesting discussion afterwards.
I did a trial run for of Reality Dysfunction presentation at Scrumbeers yesterday. The presentation was very well received, though it was much too long. You can read the audience comments and reactions here.

The Scrumbeers gatherings are always fun. This time, it was also very, very useful. The feedback I got will enable me to make the final presentation even more fun, and shorter. Lots shorter. My presentations tend to be about as long as a Hollywood movie. I need to cut this one down to 35 minutes or less before I present at the Lean Kanban Nordic conference on the 12th of Mars.

I'd like to thank the audience not just for being very interested, kind, and fun to spend time with, but also for giving me lots of useful feedback.

I am looking forward to the next Scrumbeer.