In his book “Ackoff’s F/laws The Cake” Russell Ackoff writes, “Organizations fail more often because of what they have not done than because of what they have done.” The reason: “Since errors of commission are the only type of mistake accounted for, a security-seeking manager’s optimal strategy is to avoid such errors by doing as little as possible, including nothing. The most successful executives are those who can create the appearance of doing a great deal without doing anything. Herein lies the root of an organization’s disinclination to change.”
Of course he is right. People are punished – branded as incompetent – for their failures. But we are not so diligent at identifying and tracking the results of people doing nothing. Risk avoidance is the safe path – don’t rock the boat – and keep generating the same results and slowly but surely you will get ahead. It is especially true that you will get ahead, as Ackoff writes, if you can “create the appearance of doing a great deal without doing anything.”
And therein lies the problem. A CEO I have come to know and respect quite a bit once told me his sales and marketing executives were “sowing the seeds of our eventual destruction” – even though they were increasing sales by 15-20% every year. His criticism was driven by concern that they were dragging their feet in embracing the organization-wide transformation to a lean business model. He understood quite clearly that taking the safe approach of staying the steady course would doom them when some currently unknown very lean competitor burst onto the scene, or some disruptive force blasted their supply chains or distribution channels – and they weren’t flexible enough – fast enough – to respond.
I’ve always found it curious that, while people logically assume that my typical client would be a company in trouble. After all, who wakes up and says, ‘Business is good, we’re making money, everything is moving along well – I think I will call in a consultant to help me transform the entire business to something completely different’? Surprisingly, that is exactly what most of my clients do, and from what my friendly competitors tell me, most of their clients do as well. The overwhelming majority of companies that successfully transform were doing pretty well before the decision to transform. I can only conclude that the company is doing well because it is led by forward thinking leadership; forward thinking enough to know that today’s success will not be good enough tomorrow. And that the companies in trouble in trouble due to risk averse management – folks who are terrified by anything outside of their experience range.
When the business goes under, the explanation will always be some outside force – a tough economy, some breakthrough technology developed by someone else, the labor union, the bankers – or it will be something someone did wrong – we made a poor acquisition, we invested in the wrong product, we over-extended ourselves when we built the new warehouse. It will never be a failure to act, however. It will not be explained as sticking to an old business model instead of becoming lean. It won’t be that we sat idly on our old top down culture instead of showing more respect for, and being more inclusive of our employees.
Ackoff’s point about creating the appearance of action while actually doing little reinforces my old point about looking lean, rather than actually being lean, from my Evolving Excellence days when I wrote about the likes of Delphi hauling in Shingo Prizes by the cartload as they trudged steadily toward bankruptcy. Deploying lean tools without transforming management and culture is exactly what Ackoff criticized – looking like a change agent while actually changing very, very little.
Of course the biggest problem with a fixation on errors of commission while largely ignoring errors of omission is that is quite easy to learn from mistakes. An error of commission – doing something that turned out badly – is always a prime opportunity to learn. It is the fuel for the Plan – Do – Check – Act cycle that is the essence of improvement. It is nigh unto impossible to improve or learn much from a Plan – Sit – Check – Act cycle