Root Causes are a Root Cause

Many will know this quote:-

For Want of a Nail
For want of a nail the shoe is lost;
For want of a shoe the horse is lost;
For want of a horse the rider is lost;
For want of a rider the battle is lost;
For want of a battle the kingdom is lost;
And all for the want of a horseshoe nail.

—George Herbert

 

This perhaps one of the earliest exhaltation to preventive maintenance, but is also an example of how problems can have root causes many levels down the chain.  Despite most of us knowing this poem, we all have a tendency, on identifying the most visible problem will immediately deploy efforts to solve it rater than lookign for the root cause (in the case of Herbert – poor equipment maintenance).

In truth a very simple method to trace down to root cause is contained within Herberts verse ; The 5 whys.  By being a little cautious of the obvious and asking “Why” one can dig down and obtain a better understanding of the source of the issue.  There is of cours enothing magic about 5 – it could equally be 3 or 7.  In Herberts verse one could ask another why

  • why was there no nail, and perhaps the answer would be that the nail delivery did not arrive
  • why did the nail delivery not arrive; the answer could be that all the waggos were comandeered for the war effort.

So where does one stop?  However there are 2 rules:-

  1. Ensure there is some real evidence at each level so the process does not go off on a tangent.
  2. End the process when
  •  several problems have the same root cause 
  •  the root cause is very basic
  • as in the above case the process indicates a circular cause

Once one has a candidate for the root cause then work on it and check the result in good PDCA fashion.

Read the following for more details on the 5 whys

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Bridging the Strategy Execution Gap

Much business literature suggests that we develop a sophisticated strategy and implement it, however recent work by Kaplan & Norton (The Execution Premium, Harvard Business School Publishing, 2008) seems to indicate that execution is every bit as important as the stategy (surprise!).  Indeed Kapland & Norton point out that a average strategy well executed can be more beneficial than a superb strategy poorly executed.  Now consider that the point in time when we are developing strategy we have the least experience of the consequences of that strategy so why all the empahasis on the great strategy?

 

The idea of an itterative strategy is gaining more purchase where instead of the strategy reviews we are all used to (ie. confirming all is going well) we purposefully expect the strategy to develop and change as more information comes in at the review points.  This seems a lot more logical, but perhaps it is less attractive to major consultancies who help to develop “The Strategy” and then leave a client to implement it and if it does not work it must be down to poor execution.

Don Sull of London Business School has generated a set of three short videos which clearly set out the problems of conventional strategy and an itterative model:-

Video 1 :- The problem with conventional linear strategy development

Video 2:- An alternative to linear strategy

Video 3:- The stages of an itterative strategy cycle

These videos are well worth the 2o minutes it takes to watch all three.

Enjoy!

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Not all Business Improvement requires BIG Changes

Most of the material published on Change Management/Improvement appears to concentrate on large organisations with big changes.  This is hardly surprising since this is where the big £ are made, or unfortunately in a large proportion of cases lost.  An IBM study “Making Change Work” identified that 15% of all change/improvement initiatives failed completely & >40% failed in a major area.  So change is difficult – good news for the increasing group of chnage management consultants.

Business Improvement however does not have to be either complicated or risky.  One of the much trumpeted requirements for improvement projects to work is “getting people on board”, “aligning the business” or various other similarly named activities.  Surprisingly perhaps many small companies suffer from poor goal alignment across the company.  This is often as a result of the company expanding past the small well aligned group which started the business, or perhaps a sudden uptick in work activity sucked the hours out of the day and something had to give.

As most of the change management literature will say that alignment is one of the most powerful elements in delivering improvement – logical really because alignment suggests all understand the goal and embrace it and will therefore make their business decisions with the alignment in mind.  To be aligned there needs to be a common acceptance of  the company’s current status and the goals to be achieved.   In order to be a strong encouragement to action the progress toward the goals must be updated regularly in order to encourage all to consider how they may modify things to achieve the goal.

Perhaps the most powerful method of achieving this the humble whiteboard  (OK I know I am a fan of this method of communication in small businesses, but that is because it works).  The easiest way to achieve this is to select 2 or 3 criteria which are critical to achieve overall business targets (eg. Sales, Lead time, Orderbook, on time delivery, quality costs, defect counts, material issues complete etc.).  These are added to the white board with the following columns:-

Last Month,  This Month Target, Yesterday, Week to Date, Month to Date.   This  whiteboard(s) to be placed prominently say  by the factory entrance, by the clocking in point, next to coffee machine.  Do not forget the off site people – send them a text message with the information when you update the boards, or perhaps uses some sort of interactive computer desk top.  Keep this up for a couple of months and you will be surprised at the impact – if you are hitting targets everyone will feel positive  and upbeat, miss them and it will surprise you what feed back you get on reasons for failure.  Polish the month off with a month end review around the whiteboard(s) with management and section leaders doing the update,

In my view this methdology should be deployed in every small company, change the metrics if necessary every 6 months, but make the metrics simple and ensure the link to the company’s goals and well being are obvious. 

A word of warning – everyone will notice almost immediately if the data is not updated so get into the habit of updating it the same time every day.  If for some reason it cannot be updated (eg. IT issues) these need to be noted on the board.  Failure to update the boards without good reason will be seen as lack of commitment by management and almost immediatley the positive impact will be reversed  – you have been warned!

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Business Change and the Bagel

There is a recent post on the HBR blog focussing on the impact of silos on business improvement by way of a fabel on sandwich making.  This fabel relates the tale of a waiter who understands the customers exact requirements for a sandwich, but fails to correct kitchn staff when they get it wrong.  The conclusion is that the waiter was not “brave enough” and that the organisation was not committed enough to giving the customer what he wanted.

Like all business fabels there is a degree of truth in it, however in real life the situation is much more complicated – transparency and joint responsibility must be across the company with no sacred cows.  All too often the transparency is partial and sacred cows grow up such as not revising budgets when they are clearly not going to be met, sales targets which drift month on month because senior management is too nervous about reporting the slippage to Group.  Sacred cows prevent free communication and can lead to people in other areas “keeping their head down” and thus not providing input into difficult areas.

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In Praise of the WhiteBoard

Coordinating business activity is always a challenge, however it becomes more so in times of change or challenge to the business.  Almost all business writers (eg. Robert Kaplan) state that communication in such times is critical and transparancy of information is key to getting everyone on-side.

How to do it?

Well within SME’s (typically up to a 200 people) I am a strong fan of teh Kiss principle and believe there is nothing better to focuis and coordinate actions than a “war room” – or in less agressive parlance a “control room”.  The attributes of such a room are simple:-

  • Big enough for all the essential players to get in.
  • Visible form the outside – nothing is more powerful in times of trouble than knowing the management is managing.
  • Regular review meetings (usually twice per week) , compulsory attendance of key person or a delegate.
    and in my personal preference
  • Lots and Lots of whiteboards.

The focus of the “control room” is simple –  get everything out in the open & deal with it.  Agree actions (noted on the white boards)  and be responsible to your peers for delivering those actions.  This can be a scary concept to some, but it is  effective at binding the team together and motivating all to a team goal

This may all sound terribly trivial, but it works especially well in smaller companies – give it a try and see if it works -t can also be a great release to scribble on the whiteboards and even greater release to rub issues off,

 

 

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Business Change – Downsize/Upsize – procedures and practices need review

Many businesses have had to go through the pain of downsizing and all the disruption that this entails.  Strangely in many companies remaining team members rally around to ensure the business can still function.  They often make their own arrangements to:-

  • Combine roles
  • Check each others work
  • Take a “big picture view”

All this is truly great, however as business starts to pick up this can pose some serious problems.  As work levels pick up the jobs which people “picked up” to make sure the company continued to operate get dropped, and this can lead to:-

  1. Unexpected holes in business procedures.
  2. Opportunities to control costs neglected.
  3. Lean principles and flow forgotten.
  4. occasional but highly important jobs neglected (for example reviewing contracts).

It is for these reasons and others that recovery does not deliver the bottom line performance that are hoped for.

I have been involved in several businesses who have gone through reductions in work force, and then suffered serious challenges when trying to ramp up again.  For example:-

  • A company making a highly technical product had needed to downsize dramatically and was weathering the downturn, however as the recovery started product yield dropped to below 25% even though they were making less product than before the downturn.  The company had “lost” some of it’s procedures and practices and it did not even know what procedures it had lost.  The recovery was achieved, but it took 6 months and involved costs that could have been avoided.
  • Another company making a capital product had unfortunately to endure a number of redundancy rounds.  Quality costs built rapidly and customer dissatisfaction increased dramatically.  The company had weak procedures but there were a number of “glue” people who linked various operations together – these people were not identified or understood by the management and some of these people were casualties.  In particular the company lost the ability to review the contracts of their customers, and also the ability to translate this into a build specification.   Recovery was achieved, and although rapid progress was made it took almost   to work out all the issues and return to profit.

In conclusion if a company is planning for growth it should check its operating procedures and work practices in preparation for the change if it is to maximise the benefits of growth.

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