December 10, 2013 Sections
Winnipeg Free Press - PRINT EDITION
CALGARY -- In Red Deer, Alberta, they're worried about the loss of locally dispatched ambulance services. Alberta Health Services will be centralizing the function. It was centralized once before but it didn't work out.
According to the health quality council of Alberta, the failure wasn't because centralization is the bankrupt organizational strategy it is, but rather because the centralization didn't go far enough. This is the same logic that took us from an efficient and effective health care system to the bureaucratic behemoth we have today. But hey, if you got a strategy, stick with it. Just don't have an emergency in the countryside around Red Deer.
The stick with it despite all evidence to the contrary approach is common in industry and government. For example, both are investing millions in the latest information technology that promises to solve all our problems. It turns out the previous IT implementation, making the same promises, didn't deliver the results expected. Strangely, that was the case for the previous two IT enhancements as well. Thank goodness this latest upgrade will fix all that.
On the consumer services front, my cell phone provider is busy making improvements to serve me better. I know, because they never stop telling me about it. "We are making these changes to serve you better," they say. Each service improvement ends with me having to migrate an increasingly confusing telephone menu after being told to; "Listen carefully, our menu items have changed." With each round of improvement, I seem to get further away from the person I'm trying to reach.
McKinsey and Company report that 70 per cent of all change initiatives in business and government fail. This includes mergers, corporate reorganizations, enterprise-wide IT implementations, quality improvement programs, cost-cutting initiatives, culture transformations, and customer service enhancements. Two major studies by IBM reached the same conclusion.
Well, McKinsey and IBM should know, because they're so often leading the change, but I feel 70 per cent is conservative. After all, those surveyed were those responsible. They can be forgiven for underestimation. These studies had large sample sizes because so many companies surveyed were repeat offenders -- reporting the same dismal results after their third, fourth or fifth attempt.
Hope springs eternal. With each new initiative, organizations declare "this time for sure" followed quickly by extensive rationalizations as to why the whole mess isn't really as bad as it seems. "We learned a lot" has become the Prozac of the organizational world, swallowed whole and taken by the truckload.
What's wrong here? How do we keep doing the same things but expecting different results? Simply put, some organizations have a learning disability. They march on in comfortable directions rationalizing away any evidence that doesn't confirm their biases. Bill Dettmer, author of Strategic Navigation, calls these rationalizations "dead horse" strategies.
Dakota tribal wisdom says that when you discover you are on a dead horse, the best strategy is to dismount. Learning disabled organizations have different strategies.
Declare that dead horses do not have to be fed, are less costly, carry lower overhead, and, therefore, more cost effective than live horses. Eliminate live horses as a cost cutting initiative. Have Purchasing standardize on dead horses.
Name the dead horse "Paradigm Shift" and keep riding it. Tell others that soon, everyone will be riding horses this way.
Benchmark the performance of the dead horse against other dead horses. This may include site visits to watch others ride their dead horses.
Train people to ride dead horses. Implement performance appraisals and provide incentives to those riding dead horses best.
Harness several dead horses together for increased performance. This will include frequent use of the word "synergy."
Create dead horse standards and conduct an audit to ensure your dead horse is in compliance. Issue final report stating your dead horse exceeds specifications.
Centralize dead horses to gain economies of scale. Lament the lack of newer, bigger, and better, dead horses to build critical mass.
Outsource the riding of dead horses. Investigate public-private dead horse partnerships.
Downsize the dead horse and replace it with an entry-level dead horse at one-third the salary.
Conduct an engagement survey. Compare engagement levels of dead horse and live horse riders. Fire the manager of whatever group scores lower. Complain about declining engagement.
Hire McKinsey or IBM to proactively strategize dead-horse utilization maximization including potential efficiency gains from an automated dead horse work flow solution. Issue report on the change management implications of dead horses.
Robert Gerst is a partner in charge of operational excellence and research and statistical methods at Converge Consulting Group Inc. He is author of The Performance Improvement Toolkit: The Guide to Knowledge-Based Improvement.
Republished from the Winnipeg Free Press print edition March 23, 2013 J6