Systems Thinking – Page 41 – Discipline makes Daring possible.

February 12, 2021

Big questions for accountants

I like to ask big questions of accountants in my podcast.

Professor Richard Murphy has some interesting answers.

This video of his proposes a new way of financial reporting for ‘public interest entities’ – the big corporates we all depend on for infrastructure, food supply etc., that looks at the interest of all stakeholders, not just shareholders.

I think reporting this way, even if you aren’t legally required to, could give a real advantage to some smaller, more forward-thinking businesses.

If they dared to take it.

I’d love to know what you think, especially if you’re an accountant.

PS Professor Murphy has an even more interesting vision for audit.

February 9, 2021

Beyond startup

I’m a big fan of ‘The Lean Startup’, which I’d sum up as follows:

“The job of a startup is not to make money. It’s to find out what the market really wants.”

In other words, starting a business is about testing, refining and re-testing until you find what delivers real value, and so makes you money.

The trouble is, this can take years. There’s no shame in that. It’s just that most of us do this in an undocumented and somewhat unconscious way, internalising our findings as we go.

This means that when the time comes to expand our capacity, to meet the demand we’ve identified and finally start making the money, we struggle to communicate this vital information – who we are for, what we promise them, and how we deliver on that – to the people we need to work with, and that can lead to stunted growth.

The first step to remedying that is consciousness, which is why The Lean Startup is such a help. But what about after startup?

Here’s my solution:

Purposely design your business as a system for making and keeping promises, and improving how you do that:

That way, everyone involved in your business can stay conscious. Even after you’ve gone.

February 5, 2021

Synthesis

I spent quite a bit of my early career being called an analyst – someone who resolves or separates things into its elements or constituent parts.

In reality, like all of us, I’m mostly a synthesist. Putting thoughts, information, ideas, anecdotes, experiences together to make a whole – a model of the world that is coherent, at least to me, hopefully to others too.

When it comes to work, here are some of the ideas (axioms? premises? prejudices?) I grapple with, trying to synthesise a useful model of what it means to scale successfully as a business:

Making things (not necessarily tangible) that will be appreciated by other people is a fundamental human need.
Everyone needs agency, mastery, autonomy, purpose, community and status.
Being human is difficult, valuable, not to be wasted.
Nobody has a right to control another person (with rare exceptions that are to do with the other person’s safety).
Nobody ever achieves anything alone.
Most small business owners care about the impact they are making on their customers, their team and their community. Increasingly they care about the impact they make on the planet.
Most employees work in order to live.
Most employees want to do their best work.
Most people want to be able to bring their whole self to everything they do, including work.
Most employees want clarity about what they are there to do.
Most employees don’t want to be told how to do their job.
Most small business owners never set out to be in charge of other people.
Most people want to do things for themselves, until they can’t. When they can’t they want to be helped to get back to doing it for themselves.
Most small business owners aren’t capitalists.
There is plenty of business to be done to enrich people and planet. Small business owners don’t need to be capitalist.
Processes are for people. Procedures and work instructions are for machines.

I’m not there yet with my coherent model, but I feel like I am getting there, and I’m enjoying the process.

What would you add to/remove from my list?

February 2, 2021

Hegemonic Narratives

I learned a new concept today: ‘hegemonic narrative’. In plain English, a ‘dominant story’ about why things are the way they are.

Dominant because more or less everyone subscribes to it.

Story because it’s made up.

In fact human history could be said to be one long sequence of hegemonic narratives, each one displacing the previous one, not necessarily for the better. Often benefiting one group of people over others. Beneficiaries therefore have an incentive to keep their story dominant.

They are psychologically useful, because they help us live with contradictions. But they are nevertheless made up.

Much better to try and resolve the contradictions, and create a story that works well for everyone.

The good news is that inside your company at least, you are free to do just that.

For a long, but very interesting article on how such stories work, check out this article: “Explaining the Persistence of Gender Inequality: The Work–family Narrative as a Social Defense against the 24/7 Work Culture“. It’s a fascinating read.

February 1, 2021

The Disappearing Boss

I’ve met hundreds of small business owners, but I’ve yet to meet one who set out to be a Boss. Or at least a Boss of more than one person.

We embrace the challenge of starting a business, of finding customers, but we become Bosses reluctantly, sometimes half-heartedly, not always effectively.

Sometimes the experience of being the Boss of other people is so painful we joyfully go back to being the Boss of just ourself.

The trouble with that of course, is that the potential to create ever more value disappears along with the role we dislike so much.

There is another way to disappear as a Boss.

Instead of walking away, make yourself blend in. Enable your people to act more like Bosses, more like you.

After that it’s the more the merrier.

If you’d like to learn more about how, there’s a little welcome treat from me: Sign up for The Disappearing Boss Newsletter

January 29, 2021

Swarms

Swarms look like an attractive option for decentralisation. After all, “Social insects work without supervision. In fact, their teamwork is largely self-organized, and coordination arises from the different interactions among individuals in the colony. Although these interactions might be primitive (one ant merely following the trail left by another, for instance), taken together they result in efficient solutions to difficult problems (such as finding the shortest route to a food source among myriad possible paths). The collective behavior that emerges from a group of social insects has been dubbed ‘swarm intelligence.'” (Corporate Rebels blog ‘Reinventing work‘)

As you know, I’m all for self-organisation, but for me it has to emerge from autonomy and a shared purpose. Ant colonies work through programming. Individual ants don’t get much say. I’d rather be a goose.

A different kind of swarming showed up this week around GameStop shares. Bottom-up collaboration between individuals.

The queen ants of Wall St. didn’t like it at all.

January 25, 2021

Mechanical ecosystems

Let’s look at the human body. Simpler, less tightly-coupled joints are held in place by muscle and cartilage, combining rigidity and strength with flexibility and adaptability. Although there is a ‘standard’ bone shape, tolerances are high, accommodating a wide range of variation in components – both across a population and within a single individual. Growth is allowed for.

At the same time, possibilities are constrained by the surrounding muscles. If there is too much play in a joint, strengthening muscles will help. If there is too little play, stretching and loosening them will allow more movement. Remediation is possible without taking anything apart, or even stopping – all that’s needed to keep things in good order is a healthy variety of movement.

Perhaps this is the sweet spot between machine and ecosystem we should aim for in a business?

January 22, 2021

Ecosystems

The thing that makes ecosystems different from machines is that they are made up of autonomous, interdependent and loosely coupled components, which may themselves be ecosystems.

Autonomy allows evolution in the component. Loose coupling means that the ecosystem can tolerate a good deal of evolution before it breaks. Interdependence gives feedback to evolving components, constraining or encouraging variation, and, in the end, allowing the ecosystem itself to evolve.

Actually, it’s not really possible to break an ecosystem, but it can evolve into something that becomes hostile to one or more of its components. So the question for owners who want to build an ecosystem rather than a machine, is how to keep it in balance, without stifling creativity?

Maybe the answer is to explore something between a machine and an ecosystem?

January 21, 2021

Building precision

When you’re putting together a machine that needs to run without you, precision engineering is key. Each component must fit tightly to the next, in exactly the right position in order to perform a single highly specific function, and no other.

The upside of this approach is efficiency, durability and a kind of austere beauty. Standardised parts are simpler to mass-produce and easy to replace. You can reach a much larger market. And the whole thing runs as we say, ‘like clockwork’.

The downside is that building a machine takes a lot of upfront investment, and when new technology comes along, that highly-engineered investment turns itself into a pile of scrap. This is true of software machines too.

So maybe the answer is to take our cue from nature and build ecosystems instead?

January 19, 2021

How to capture a business process: Step 2

Step 2 of capturing a Business Process is to work out where it really starts.

A good rule of thumb is to think about where the ‘thing’ you’re dealing with – the ‘Noun’ in your process’s name – gets created, from the perspective of the business. These are good questions to ask:

If the thing is created outside the business, where does it first come into contact with it?
If the thing is created inside the business, where does that happen? Is that where it should happen?

You can ask similar questions to find where your process really ends:

If the thing passes through the business, when does it leave?
If the thing only exists inside the business, where does it get destroyed, or archived?

It’s helpful to think about the process from its real beginning to its real end, because that’s how many opportunities for improvement can be identified, without having to go to the trouble of documenting the entire thing first. It gives you a shortcut, if you like.

Discipline makes Daring possible.

Musings from The Disappearing Boss on People, Process and Responsible Autonomy for small-business employers.

Category: Systems Thinking