Decisions, decisions

I am currently reading The Decision Book. It sets out fifty models for decision-making alongside some historic context to each model. I’m reading one a day – a bit like Thought for the Day.

The Decision Book even has something of interest to say about old and familiar favourites like the SWOT model of Strengths Weaknesses Opportunities Threats. The SWOT section includes a quote from Margaret J. Wheatley relevant to our uncertain times:

The things we fear most in organisations – fluctuations, disturbances, imbalances – are he primary sources of creativity.

Beware successful Chief Executives?

I often have a look at the Random Rantings of Freek Vermeulen - an Associate Professor of Strategic & International Management at the London Business School. This month he has warned that some of top performing chief execs should be avoided like the plague.

The logic is:

Bad managers are those people who just don’t get it. They accept worse average returns for higher risks. And this is where it gets tricky. Because if they accept very high risks, in spite of lower average returns, every once in a while one of these morons will actually hit the jack-pot…

That is, if we take the top 1 percent – and only this 1 percent – of top performers, they’re likely to be those people who don’t get it at all… but just got incredibly lucky!

He goes on:

The same is true – as Stanford’s Professor Jim March asserted – for CEOs. The ones that are the eye-catching top-performers are likely the ones who just don’t get it. The dangerous thing is that they are also the ones with the absolute highest return in their business. Therefore we naively believe that they “do get it” and, in fact, are quite brilliant. Moreover, that’s what they start to believe as well… (“I win again; I must be brilliant…!”). Yet, they got lucky once, the might get lucky twice, or three times (at which point we start to notice them) but eventually their luck will turn (the names of Bernard Tapie, Jeff Skilling, Cees van der Hoeven and Conrad Black come to mind).

He concludes warning against “top performers” in any business or situation which involves risk:
The one coming out on top is likely to be a moron, who just got lucky.

I suspects the theory has the ring of truth for many people. (I also think that there are all sorts of interesting issues around management, leadership and success. How often do successful managers demonstrate themselves to be poor leaders when they are asked to lead people rather than manage things? How often is the asset of charisma associated with a dangerous risk-loving attitude?)

Nevertheless even if the theory makes sense, I think care should be taken in applying it to assessing, appraising and rewarding performance!

The Healthcare Commission learning from investigations – mergers, targets, governance and other common themes in public services

The Healthcare Commission watchdog has published an interesting analysis of lessons from 14 investigations into patient safety failures. Such analyses of failing organisations are always to be welcomed. In social housing there are the Learning from Problem Cases series of reviews into "supervision" cases (see the Housing Corporation website here and here). Sadly in other sectors, such as further education colleges, there are ad hoc reactions to failures rather than systematic reviews and efforts to promote learning.

The Learning from investigations report (pdf available) found common themes:

1) Leadership and management: Poor leadership was a problem in nearly all of the investigations carried out by the Commission.

2) Some boards had been focused on mergers or targets at the expense of their broader activities.

3) Lack of continuity in leadership was a problem in some trusts, where frequent changes in management were a factor in poor care. Bullying and harassment by managers was a factor in two cases investigated. The Commission found there was a fine line between promoting change vigorously and bullying.

4) Investigations often uncovered a breakdown in leadership and management, with a lack of clarity on responsibilities from board to ward. Poor teamwork, either between management and clinicians or between clinicians themselves was another common factor in failings.

5) Use of information: The Commission found that most of the trusts investigated did not have adequate systems in place to routinely inform the board of trends or potential problems.

6) Mergers and restructures: Seven of the trusts investigated had recently undergone mergers or significant organisational change.

7) Safeguarding vulnerable adults: Poor understanding of adult protection procedures and responsibilities was a serious problem in the two investigations into learning disability services and also a number of interventions in trusts.

8) Poor care on general wards: When its investigations looked at acute hospital care, the Commission noted that care on general wards fell well below the care provided on specialist wards. Older patients were most at risk as they were often most dependent on good nursing care.

It is note-worthy that the first five of these themes are found widely across public services.

Jerks and the public sector

The McKinsey Quarterly carries an interesting article on jerks in the workplace and building a civilized workplace.

In the article Robert Sutton argues for zero tolerance of harassment of workers. A “no jerks” policy as adopted by the software company Successfactors.

The article lists the “dirty dozen” seen with workplace jerks:

1. Personal insults
2. Invading coworkers personal territory
3. Uninvited physical contact
4. Threats and intimidation, verbal and nonverbal
5. Sarcastic jokes and teasing used as insult delivery
6. Withering emails
7. Status slaps intended to humiliate victims
8. Public shaming or status degradation rituals
9. Rude interruptions
10. Two-faced attacks
11. Dirty looks
12. Treating people as if they were invisible

The article discusses calculating a Total Cost of Jerks. It quotes one company where one star salesperson—generated additional costs of $160,000.

Jerks are a problem in all sectors of the economy. How much do they affect productivity in public sector organisations like the NHS?

Juries, boards and diversity

While recently traveling on crawling Russian trains and decrepit ex-Aeroflot planes I have been able to read some books. My holiday reading included the book by James Surowiecki on The Wisdom of Crowds. It is an interesting set of essays on the effectiveness of collective wisdom - collective wisdom even trumping individual experts. (He does explore when and how groups don't work as in stock market bubbles.)

I would recommend that you read the book if you haven't already. (Its been out a couple of years.)

I was particularly interested in the chapter on Committees, Juries, and Teams. Many of Surowiecki's comments have a bearing on governance and management.

Surowiecki argues that juries are either verdict-based (starting with the verdict and working back) or evidence-based. He also points to the influence on group decisions of the status and talkativeness of individual group members.

In making small groups work better Surowiecki stresses the importance of diversity of group members. This militates against "groupthink" and improves the chances of a "devil's advocate" emerging who can challenge and test the evidence and recommendations being put forward.

I see Surowieck's arguments supporting the case that boards and governing bodies should have a real social, gender, ethnic and skill mix. This isn't "political correctness" or just "tokenism" (although it can be, if done badly) - it is a vital contribution to making decision-making more effective.