Thinking about one of the ‘golden rules’ of governance

It’s a long way from done but it’s already been an interesting year – by which we mean “interesting” in the sense of the curse “may you live in interesting times”!  Frankly, for our taste the last 12 or 18 months has been just a little bit too interesting!

Looking back a bit further, though, one of things that has not changed in all the years of our work together is that the same lessons tend to pop up for our clients no matter what sort of organisations they may be.

As long ago as the 2008 GFC, for example, when so many were bemoaning the financial situation, we had franchise groups and not-for-profits, tiny start ups and big commercial groups, all asking how to handle the growth that had surprisingly come their way and learning the lesson that growth can be a great deal harder to manage than decline.

On a much more routine basis, we get asked the same few handfuls of questions about good governance and effective decision-making – lessons we are very happy to share so that boards and executives can save themselves the tears already shed in the hard experiences of others.

That’s why we have regularly added to the materials available here as background reading – a cup of coffee and a bit of a ramble through a couple of those and clients are well on the way to asking better questions which will help them to get to the heart of their issues.

Most frequently requested?  There’s only a short half head between our wee summaries which help defuse the arguments about what governance is or why the board is always reading plans or what the board should be worrying about anyhow!

The moral of the story is that while the unique details of each organisation matter for finding an appropriate answer to their questions, no organisation is entirely unique – so the overarching elements of governance are very nearly always relevant, even if how they play out is tailored to the circumstances.  That starts with remembering that the board is there to govern, and not to manage, even though so many boards are made up of people who are accomplished executives in their own field.

On that note, and at a time when everyone from banks to the UN to movie-makers to churches are being named and shamed for what they failed to govern, and then failed to fix when the failure of governance came to light, our thought for the week is from our ‘golden rules’ of governance – guides for boards and executives that, from our experience, are almost ubiquitously applicable:

Do or review, but not both. 

Reviewing your own decision is a conflict of interests.

No matter what the organisation does, who owns it, or how it is set up to operate, sound supervision is the bedrock of realising good governance.  We need to trust the decision-makers that we appoint, but the wisdom of ‘trust, but verify’ never gets old.*

For a typical example, that sort of supervision means that a regime for ensuring decisions are reviewed is always appropriate, and the more qualitative the judgments involved in the decision, the more it usually warrants a review.

That much said, a review won’t achieve much unless it is separated from the original decision-maker.  In many cases, a review will need to hear from those accountable for the decision and those affected by it, but the review itself should not involve them as such.  Put another way, being involved in making a decision gives you an interest in it, being involved in a review of that decision is an interest in that – ergo, doing both means you have a conflict of these interests.

This does represent some challenges in a micro-business, but, in anything bigger, this should be a particular consideration in structuring the roles and responsibilities of everyone from the board room to the shop floor.

Sad to say, even in well-governed organisations serious problems do bob up – so if they do, the more egregious the situation, the further away from those involved the review needs to be.  That is why we never hesitate to recommend involving the police if there is any allegation of unlawful conduct, to ensure that there is no possibility of sweeping things under the carpet – or indeed, just being seen to do so.

On a lighter note, a thoughtful allocation of ‘doing’ decision-making and ‘reviewing’ decision-making not only gets you a long way towards good governance, it often clears up workload by the process of being clear about who really needs to be involved in a decision, and who is playing some other role – this readily becomes visible when the purpose of the decision is picked apart in more detail. In the same vein, one form of supervision is reporting, which works very well if the decision-maker who wants the report remembers to define what it is that they want to review.  More on those two another day.

 

 

*Not without a truckload of irony, thanks to (ex-USA President) Richard Nixon for that one.

Getting to more than the sum of the parts

There are many organisations that have no legal obligation to follow this or that regime for corporate governance. But our question remains, why do it the hard way?  Instead – after decades of high-profile corporate disasters – why not learn a lesson from the experience of others: it seems far better to choose proactively to report along such lines, instead of this later being thrust upon the board, forcing the board to explain on the run what they did, when stakeholders raise questions.*  As a wise high school principal of our acquaintance says – ‘better to say “I’m glad I did” rather than “I wish I had”‘.

To get your thinking started, we’d suggest that like making great coffee, good corporate governance is much more than the sum of its parts.

From where we sit, the X factor is intent, which needs to be evident throughout the necessary processes – showing the mutual will to make the organisation capable of achieving the desired results in the right way. That intent transforms what are often mundane processes into good governance, so that intent is the guiding light for:

Getting the right decisions made well, and implemented appropriately; seeing them come to fruition and thus the organisation’s purpose realised, to the benefit of those it is there serve; and doing this not just for today and tomorrow, but sustainably, so that next week and next year the enterprise can keep the promises it makes in its relationships with employees, volunteers, customers, clients, suppliers, and so on.

When the headlines are so full of staggering examples of “ready, fire, aim” leadership – or, sadly often, just “ready, fire” – we have revisited an earlier paper where we think through what good corporate governance might look like.

To be sure, there is no magic formula, no system that is a panacea for all ills in this.  But we’d still say (to mix in another metaphor for good measure) – when your decision making chickens come home to roost, best they be comfortably accommodated in a nice neat henhouse, rather than losing their heads!

*PS 1 December 2017: Or, indeed, the much wider community raises questions, as many in Australia’s banking industry might now find with a Royal Commission set to dog their footsteps.

Rectangles are not squares, and not all roles in decision making are decision making roles

The trick maths question back around mid-primary school is about squares and rectangles – both are defined by having four sides, two sets of parallel sides, and four corners of 90º.  But squares have one more feature, crucial to the definition – all sides are the same length.  So all squares are rectangles but not all rectangles are squares.

And so it goes in decision making processes: there are many roles involved, and the process cannot be completed without each person playing their part – but being part of a decision making process by no means makes an individual a decision maker.  In this, we make a distinction between:

  • deciding something that is an open question of leadership and judgment – for example, which markets to focus on to grow sales and which channels to use to do this profitably, or which segment of the needy to prioritise, and how to reach them sustainably, to deliver assistance within the nonprofit object and purpose of the enterprise; and
  • following rules that someone else has already determined – for example, completing the steps in a chain to ensure delivery of goods or services in the new market, or similarly using a process to identify those in need within the ambit of the purpose of the enterprise.

Good decision processes, like processes generally, go well only if  those involved genuinely understand what they are there to do.  This has been a feature of our work with boards for many years, so we have recently revised an earlier paper to give some coffee time reading for boards and senior executives who are concerned to get the best from the efforts of their team.

The tricky bit is where subsidiary choices may look a lot like decisions.  Think of the IT guy (of any gender) who is accountable for getting the IT equipment that the organisation needs.  Purchasing delegation, for example, is usually handed from the board to the chief executive (and possibly sub-delegated to others as the organisation grows) – that commonly involves a delegated authority to spend up to some amount and to decide things like who gets a laptop, who gets their own desktop, and who has to share a workstation.  In mid-to-large organisations that might involve expressing a policy rather than making each individual purchasing decision, but the impact is the same.  Unless they are the spending delegate on behalf of the chief executive (unusual as this is usually a line management function), the IT guy is accountable for carrying out the decision of the chief, and will have to account later for how well they did so – including how well they followed the policies (ie. pre-set rules) about what the preferred IT items are in each case and where to buy them.  Put rudely, it doesn’t matter a cracker whether the IT guy agrees that a particular person needs a laptop, so long as the appropriate decision maker has made that call. (Of course, a decision maker worth their salt will always listen to expertise offered by such people about all the options and costs to address the problem that they trying to solve by their purchasing decision, and may revise it accordingly – but it always remains their decision.)

Or put more simply, if the top dog decides that everyone can have $10 per day to buy a drink at the local cafe, the choices that each person makes as to what (if anything) to buy are not decisions in the sense that we use the term.  Even the process watchdog who assesses whether individual choices are within the rules – letting them buying a chai instead of a latte, or a soft drink instead of a brew – is only applying the rules, not making the rules per se.  Accountability for that person is, however, partly about later answering for their interpretations and whether they went beyond their purview to, in effect, make up new rules.

Clarifying consensus

Another ThinkEvans coffeePossibly the most frequent question put to us is “if we don’t have consent amongst the board, how can we move forward?” For the largest part, this speaks to a very common misunderstanding that we strike in our work – about the meaning of consensus in a decision making process.

Part of the difficulty is that the same word is used equally to imply some form of general but informal agreement (or lack of evident disagreement), and to ‘define’ (speaking very loosely) the formal outcome of a decision making process, and to describe the character of processes by which such agreement might be reached – like ‘consensus decision making’. On top of that, ‘consensus decision making’ itself means many things to many people – the term has no strict definition, though it is often used as if it did.

Consequently, as long ago as 2010,  we developed a short paper to help clients work through these issues. In an era of populist rhetoric, we are finding that the same issue is having quite the renaissance and we are answering this question anew – so we have updated our paper and for boards and other decision makers to read at their leisure.

A crucial dilemma related to ‘consensus’ in decision making processes is that if the obligation of decision making bodies or groups is, primarily, to make decisions about the subject matter put before them, then equating consensus to unanimity is more likely to stymie most, if not all, decisions – because, in all of this, one thing’s for sure:

Consensus equated to unanimity confers on a dissenting minority the power of veto over every decision.

Of course, there is also the problem of what we’ve called ‘consensus by exhaustion’ – where those dissenting are not convinced of the merits of the other view but disengage, remain silent, and appear to acquiesce – making that consensus arise simply from weariness with the process.*

Interestingly enough, precisely the same issue has come up repeatedly in the various community service activities that our team gets into – so we hasten to add that its really no different in a volunteer situation.  In fact, leaders in community service organisations may have an even more pressing need to get a grip on this dilemma – lest they be hamstrung into inaction by a misperception that unanimity has some additional value among volunteers.  Never forget, dissent among human beings is probably our natural state, so needs to be addressed as the norm rather than an exception – and when time and money is volunteered to do good, doing nothing can be seen as betraying the trust of those who chose to provide support.

*PS 9 February 2018 – for those who doubted the occurrence or importance of what we observe quite regularly, have a read of this recent article about the process of writing the Australian Constitution!

Coffee on the road: count the cups!


We had the pleasure this week of receiving a whole bunch of nice messages from clients and colleagues on reaching a milestone to which many a small business aspires – 15 years of work together!

It doesn’t seem that long until we take a look back over the kaleidoscope of projects that we have had the pleasure of doing – and the life events strewn in amongst those too.

In fact, now that we do that, it seems a great time for another cup of coffee!  Cheers all, and thanks for the good wishes.

Coffee on the road: Enough! on April fools day

In an era of populism writ large in global events, seen equally in ‘any-opinion-will-do-if-I-shout-it-loud-enough’ leadership and public debate that often seems to have only a passing acquaintance with facts and reasoned logic, many of our clients and colleagues on boards are facing quite tough times in holding the line on more mature and considerate leadership.

Recalling our word for the year is ‘enough!’, we think they deserve reminding of the better contribution that they make by holding themselves to a higher standard of thoughtfulness, courtesy, professionalism, and accountability for the consequences of their actions.

As our part of the effort to reinforce their great work, over the coming months we will be returning to our conversations about the fundamentals of high performing boards, the contribution needed from each board member, and making the most of the senior executive team that a board often works so hard to obtain and motivate positively.

This revolves around a good working understanding of the role that ‘owners’ (our shorthand for those who want the organisation to exist), board and management play, the tools available to aid their work, and the results that each should be aiming for in their province.

In part, we will be revising the series of short papers that we have made available to clients for over a decade, since so many of the themes have found something of a renaissance in the push back against the style of leadership we are seeing on the world stage.  So be on the lookout for those, and talk to us about any of the core questions of board leadership:

  • power – the authority of the board, and distinguishing that from the influence that it obtains by great performance;
  • capacity – a magic combination of the board’s size, composition, work practice, and well-designed and executed delegation; and
  • results – the board role in directing, enabling, accepting, and refining, achievements of the enterprise in bringing its raison d’être to fruition.

Sabbatical postcard – lies, damned lies and statistics v2.0

ThinkEvans hit the key for coffeeWhat the numbers really say is an issue at least as old as published statistics themselves, but one finding a renaissance in the world of the Oxford Dictionaries Word of the Year 2016: ‘post-truth’.*

Anyone who has spent more than five minutes in a commercial organisation knows, for example, that it is possible to have both massive growth in your sales numbers and a declining market share.  All it takes is for the firm to be in a growing market, meaning it can still lag behind the market’s overall growth rate even when it is going gangbusters – because others are going more so!

Not a few firms have fallen foul of the partial truth – sales are up, hooray! – by not enquiring about the rest of the picture – how much are sales up for the whole market?  And, I hear the accountants say, sales are different from profits so all that may be unprofitable growth anyhow – cue the cautionary tale about the long list of teams who got it wrong by thinking that they could somehow bank market share, only to churn heroic sales volumes and still have nothing much of anything to bank.

Our friends in nonprofits face similar struggles to report fairly the beneficial impact of the services they provide.  They need to engender further support through positive results, but without cutting the ground from under their own feet – perhaps by a too positive report suggesting the problem has thus been solved.

Here our hats are off to the prize-winning effort by the chappie from the UN who managed to report a vast improvement in deliveries of humanitarian aid in Syria – now reaching an average of 21% of those in need in 2016 as opposed to 1% in 2015 – framed by comments that were a polite but unmistakeable hint that there was just 80% of those in need still to be reached by the UN!

Runner up and receiving the award for best effort on ‘virtue in necessity’?  The team at Care International – their recent report on the ’10 most under-reported humanitarian crises of 2016′ was an imaginative approach based on a robust methodology and sound data collection.  Making a virtue out of the necessity of confronting the issues, the report included the observations:

Journalists … have a responsibility, given that the media has the power to set agendas, hold politicians accountable and help raise crucial funds to deliver aid.
This ranking is not meant to compare misery and suffering and place them on a scale; rather, each crisis and each human fate is unique and deserves all the support we can give [but these] have been neglected or eclipsed by others grabbing the world’s attention.
Each one of them is one too many.

Any decision maker worth their salt must be skilled in understanding and interpreting information – facts, truth, lies, damned lies and statistics – and there is just no substitute for doing your own homework on this.  Sure, get all the advice you want, but do your own thinking – in fact, get some advice that you don’t want and see if your thinking holds up to the test that contrary advice provides.

In the end, if we have any pretence to decision makers being accountable, this should include that they stand or fall on the ‘facts’ that they rely on in making their decisions – no matter whether that is ‘truth’, ‘post-truth’,’alternative truth’ or anything else.

So the task that persists for us all is to keep in mind the place of outcomes in accountability, and not let decision makers off the hook for that.  Nor give up leading by example to: embrace thoughtful dissent in the boardroom; welcome diverse and contrary views in any workplace that are expressed appropriately with maturity, respect, and actual information; and show self-discipline in sorting through an abundance of informational dross to find the nuggets of gold on which to rightly rely in our decisions.

 

 

*The OED says this is ‘an adjective defined as relating to or denoting circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion and personal belief’.

Coffee on the road – our word for the year

Big surprise – no, really, an actual surprise – our word for 2017 is not ‘coffee’!

This year we are going public with our choice to applaud all those mature decision makers who know when to hold ’em, when to fold ’em, and when to walk off into the sunset for the next challenge – the ones who can hear the clanging bell and know whether it signifies the start of the next round or the end of the game.

Our word is ‘enough’.

It is the word for all those leaders who know when they have given their best to a role and done what only they could do, and who then make a positive choice to move on to the next challenge, the next part of their own journey.

It is also the word for a business – and we are thinking especially of small and medium business here, that can’t help but have a narrower engagement with the marketplace – when their place in the market is overtaken by events and the time has come to reinvent the business, for example.

Years of working with teams facing change – some welcoming it, others not so much – provide us with a feast of examples on the genuine art to judging what the environment is saying.  Has the market developed new tastes or different dynamics that don’t suit your product?  Does the organisation – commercial or nonprofit – now more generally need other messengers or, indeed, other messages? Hearing the bell and calling the change might be the most important decision a leader makes.

Part of the issue is that there is always so much left to be done.  The grown ups recognise more nuanced questions – not just what is left to be done, but how best to do it well; not just whether they can lead that, but whether they should.

Of course, knowing when enough is enough battles against fear of the unknown, of what might – or might not – come next, always in tension with the truism that progress in part relies on taking risks – in a measured fashion certainly, but taking risks all the same.

There are always some happy to take the safe path – keeping a low profile against the light of review and accountability, letting ‘consensus’ provide cover for their choices, and using creative inertia to avoid standing up to be counted on new or different directions that are needed.

In other times, the worst that might bring is a leader becoming stale by staying past their ‘use by’ date, or a flat year from unimaginative answers to the usual run of organisational questions.

This year looks different though.  In 2017, if the early warnings are in any way on target, following that conventional wisdom just won’t be enough.

For leaders in government, business, nonprofits and the entire community, our crystal ball shows 2017 as a year when taking the ‘safe’ path might be the riskiest strategy of all.

Our word for 2017 is ‘enough’.

Hearing when enough is enough is always great leadership art.

‘Post-truth’ leadership art includes caring enough to dare enough in the decisions leaders make.

Coffee on the road – what a difference an accent makes!

Thin KevanWe might not be much given to knitting our own yoghurt or weaving muesli here at ThinkEvans, but we are pretty darn serious about sustainability.  For us its about being able to keep your promises to stakeholders – not just this week or next week, but next month and next year and the year after that, whatever your enterprise is there to do in the commercial or the nonprofit space.

But it’s not just a watchword in client projects – we walk the talk in our coffee habits too!  Several years ago we stocked up on this great little Aussie innovation, the KeepCup, with ours being all decked out in ThinkEvans finery.

Time has marched on and those are now hard at work in various client premises, and on the road around the world with like-minded colleagues who love their coffee but want to avoid creating trash.

Our Managing Director Carolyn may even have had one full of the life giving fluid on hand in Tasmania a couple of years ago – no doubt part of the reason that the headline shot of a Tassie lavender landscape came out so well.

In fact, we’ve enjoyed some great stories about where those cups went and what happened next.  The best one so far was from a recipient on an extended holiday with a group in Europe.  What a difference an accent makes!  Their ThinkEvans cups were so indispensable that rounding them up was a morning ritual, to the refrain of “Where’s ThinkEvans?”  That left their fellow travellers looking around for the missing person – someone who went by the name of Thin Kevan.

Tassie lavender slider

Sabbatical postcard – kawhe i runga i te ara i roto i Aotearoa

purple coffee swirl

Kawhe i runga i te ara i roto i Aotearoa – or coffee on the way in New Zealand – prompts fresh reflection on the microeconomic importance of engaging with fellow human beings.  In Wellington to present an element of my PhD research (to a symposium on the accountability of international organisations), I was struck by the strength and novelty of profit-making capacity in some very modest businesses, and the ingenuity of the decision making involved.

Travelling for work has provided me with a considerable diversity of ‘experiences’ – not least, for example, a whole gamut of ‘welcomes’ when checking in to accommodation.  Thankfully, a woman alone on a business trip can now expect a little more than ‘yeah, waddyawant?’, accompanied by a yawn or snarl depending on the time of day.  When travelling to all corners of the planet, one does not necessarily expect each greeting to rival the Savoy in London or Georges V in Paris.  However, it is great now to be shown something other than the suspicion, hostility or disinterest with which I was routinely greeted in the 1980s and 90s, when on business trips for the Royal Australian Air Force or Qantas Airways Ltd (meaning I hardly looked like a backpacker, a hobo or a ‘ne’er do well’ of some kind!).

So believe me when I say that the duty student at the Victoria University of Wellington last week set a new standard in pleasant and appropriate service – especially after being woken at 1am to let me in as a late arrival!  It all seemed a little surreal to be greeted with genuinely thoughtful assistance and information, and I’m pretty sure my perception was not unduly clouded by the aftermath of landing at Wellington. (The runway is not getting any longer and it still feels like the aircraft is landing across, instead of along, the runway – and that from someone familiar with the old Kai Tak Airport in Hong Kong!)

Of course, I won’t say I was exactly surprised – a long career of travel in strange places is also a long experience of finding great customer service in unexpected places, including that a student, in their jammies no less, can surpass the standard of a concierge at a five star hotel.  Seeing the moves of an illiterate and innumerate market worker will do that for you – when, with less than 100 words of English and nothing of anything else beyond their mother tongue, they sell armloads of clothing goods to a crowd of very demanding tourists – who are then observably delighted in a dozen different languages.  Similarly – a nun may show more commercial acumen in running a modest hostelry than a bright young MBA does in marketing an internationally renowned hotel chain.

What was surprising to me was the extent to which this calibre of customer service experience prevailed, as I made my way around downtown Wellington over several days.  As a marketplace, it certainly has its own characteristics, features and peculiarities. There were international franchise outlets that were doing well and a few doing very badly, and there were (NZ) national and local businesses across that same spectrum.  Premium outlets were operating on a par with international standards, albeit not universally so, while price-oriented outlets were by no means as devoid of service as they could be elsewhere.

Overall, though, unless my microeconomist’s calibrated eyeball has completely malfunctioned from disuse due to PhD activities, the preponderance of outlets seemed to be thriving well by exceeding their clients’ expectations, whatever they might be.  Those that were not were doing very poorly indeed in marketplace of reasonably limited volumes (Wellington is only half the size of Canberra and a fraction the scale of Sydney, Melbourne or Auckland).

The distinction seemed to occur in the form of the ‘boss’ of the premises, for want of a better expression – all the more impactful because the premises were, on average, smaller than one would expect in a larger/more populous main city.  Whether a solo worker or leading personality in a team, if someone showed engagement and judgement about how best to solve the customer’s problem, even the casual observer could see that good things flowed.  Otherwise, it was very evident that they did not.

Sure, on site roasting of beans, organic ingredients for their snack range, and a great line in sustainable practices, made one local coffee house a magnet for the knit-your-own-yoghurt types.  But they were in the company of a much greater number of hard-pressed office workers clamouring for the life giving brew.  The fact that the quietly spoken barista also remembered the order of every regular customer was good old fashioned time saving, getting them in and out at light speed (aided and abetted by a colleague who was magic on the till) – and was clearly a factor in succeeding against lots of competition.

Where the person or team was slack, disinterested, misanthropic or just in the wrong job, customers closed their wallet and walked out.  Several mornings I was fascinated to watch people rush towards the ‘come hither’ aroma of a ‘fresh baked cookies’ franchise outlet and queue up.  That aroma would elsewhere be a licence to print money, but a goodly proportion of shoppers stopped only to frown and walk away without buying.  Observation revealed that slow service meant that shoppers had time to notice that they were standing in Lambton Quay’s ‘pigeon central’ and the staff did not seem bothered by the feathers blowing in to the shop or the impressive piles of droppings on and around their doorstep.  How well their profits would have been served by an engaged team member noticing this ubiquitous pattern of behaviour and actually doing something about it.

Compare that to the one person handling quite a crowd where shoppers were faced with a bewildering array of menu choices.  The outlet specialises in premium prepared meals for the harried worker to take home (commensurately priced – think Marks & Spencer’s M&S Fresh outlets in London).  One question (general, low fat, gluten free, budget or vegetarian?) got them a targeted menu card to peruse at leisure and allowed several customers to be served at once to a very evident high level of satisfaction, despite the premium pricing. (That one could teach most airlines a thing or two about ‘queue combing’ – the menu cards were more than half identical, but the customer was given the impression of tailoring and superior service even while they waited in line.)

A query later revealed that a team member had observed that if people took time to make up their mind they bought more, but when there was a queue they felt pressured to decide quickly and often walked away without buying because ‘there were too many choices’.  Rather than skinny down the options as they were advised, the outlet listened to this local leader and found a more thoughtful way to actually solve the problem, to the betterment of their sales – can you tell that this it made my hard little microeconomist’s heart beat faster?  (One wonders what it means for the ‘pressure selling’ school of thought.)

To my eye at least, the common factor is that each case shows that customers were still ‘real’ – not reduced to a line on a graph, or a percentage in a report – and that the person in question had discerned in context the crucial ingredients for making a sale.  The memory of an observant market worker using just a few dozen words of English to highlight answers to commonly questions about clothes – size, colour, fabric, cleaning instructions – resonated as I rambled around Wellington watching these service episodes unfold.

In particular, I very much doubt that our fresh baked cookies team could have described customer choices about their product in any meaningful way.  With an international franchise business model supporting them, no doubt they had all the details of standard staffing requirements, sales targets, and volumes of each and every variety sold.  However, they clearly lacked a crucial piece of local knowledge about actual customer choices, self-evident in the ‘turn away’ factor.  There to be seen by anyone who remembers that customers are actually people (not an amorphous ‘they’), what was missing from the picture was a leader in that outlet to take note and follow up with action.

So once more with feeling, we applaud these business ‘leaders’ (including those disguised as students and service delivery workers) without whose decision making skills their workplace would be, literally, the poorer.  As with our ingenious market worker and a commercially-astute nun (that story for another day), they are keeping the actual object of their endeavours in mind when showing thought leadership, a practice strongly recommended regardless of the activity or the nature of the organisation (commercial, nonprofit, government, whatever).

Sabbatical postcard – no time to wish for coffee

coffee warhol purpleA self-confessed cynic about process improvement, which too often fails from want of a clear objective, I am delighted to report a customer service experience that seems to shine as an exception. It was so fast and efficient there was no time to wish for a coffee while waiting in line for service!

The early indications were really not good.  My eyebrow was twitching upwards right from the off:

  • The service provider is an obvious bureaucracy that has been public about ‘rethinking its service approach’ – oh dear, read cost-cutting and probably worse service from horribly overworked staff, disgruntled by yet again being told to ‘do more with less’.
  • It involved a longer new process for the same result – again with the ‘oh dear’.  It awakened some unpleasant memories from the introduction of eTicket at Qantas nearly 20 years back – the first go around was going to require more time for check in.  Inheriting that untidy bundle from a (former) colleague I looked for a volunteer to stand up and be counted for the design.  As my newfound project colleagues lacked enthusiasm to own it, they rethought their approach to meet my objective – check in for eTicket must take no longer than with an old fashioned paper ticket (really not rocket science).
  • Then there was the delayed outcome – because it couldn’t be finished on the spot as the old process had been, the result would have to be mailed out. Really? In this day and age?  Even in a post-September 11 world that seems to complicate so many transactions, our desire for immediate gratification never gets any less and we expect technology to help us out, not get in the way.

Mmmm, the whole thing was looking underwhelming – that was “polite me”.  ‘Epic fail’, as the kids say, was more what “impolite me” was expecting.  So following the instructions I received by snail mail, I duly fronted up to the service provider to endure what could not be avoided, a grudge interaction which hardly gave them fertile ground for impressing their client (that would be me!).

About three minutes later, less time than it had taken me to park at the venue, I walked away having gone through nearly a dozen distinct steps in the process – including providing feedback gathered via sensible questions.  The staff were excellent and throughly well trained, each step made very effective use of technology (although the means of producing the final result was not in evidence).  It was so impressive I had completely forgotten my irritation about not being able to get the deal sorted on the spot.

I had also been able to satisfy my curiosity as to why I would have to wait for the outcome.  The technology for that step doesn’t respond well to pressure and has plenty of moving parts to fail, so they now use highly reliable tech to provide an interim result, which is more than sufficient until the process is finished and the final product arrives a few days hence.  The fact that the counter staff had been prepped with this info, and schooled in the appropriate manner in which to deliver it, highlights how well planned and executed the changes had been.

So, despite my low expectations, I have arrived back at my desk dead impressed.  Rather than the sadly typical result – plenty of bureau speak to set low expectations, which the project then fails to achieve – this set of process improvement initiatives has delivered.  What’s their secret?

Pardon me for the hobby horse, but it seems to me that they have taken the one parameter about which every single customer cares, and worked to that.  Put another way, they had a crystal clear objective and maintained focus on that, in what must have been a myriad of decisions to redesign the process end to end.  That they have done an end to end job is shown not least in the consistency of the messaging – in the snail mail that was up front about how the process would work now, and in how each potentially loose end was ravelled up along the way, consistent with that one overall objective.

And what might that objective have been?  The product is a low involvement, essential item for every adult with zero upside for a ‘better quality’ product, where waiting in a queue had long been the absolute magnet for complaints. Aha!

They had put focus on what caused delays, and then solved that – really solved it, not just thrown money at the problem and hoped for the best, or assumed that either more tech would be better, or that better tech would necessarily help the client achieve their objective.

Since the client need turns out to be something super sophisticated like ‘get it done pronto and don’t make me stand in line’, that’s been their service objective.  Instead of over-engineering that final step in a futile attempt to avoids delays (and investing heavily to not achieve that!), their approach was to take out the problematic step (tech that is prone to bad hair days), find an acceptable interim outcome, train the staff properly and make sure every customer is in and out very promptly indeed.  Have a consistent objective, a universal song sheet for staff, and then gather data that can be available quickly to demonstrate whether the objective is being achieved.

Ultimately, it seems to have turned out as a masterpiece of the appropriate use of technology for the overall customer result, not led by corporate navel-gazing uninformed by client preferences, or using more (or more expensive) technology for its own sake. Needless to say, this client loved it!

It’s a great parable for our collection about ‘have a clear objective’, on the shop floor and in the board room.

PS Our clients launching into customer service research have unfailingly been gripped by the cautionary tale about how not to lead the witness based on one’s own preconceptions.  Best example every time (also from the Qantas days) – the fact that ‘it was a terrible flight’ turned out to really mean ‘there was an endless queue for a taxi at Sydney airport’. In today’s example, the customer feedback questions were not exhaustive or even that sophisticated, but they were bang on target for finding out what they might need to change in the future – it tempts me to end with a smiley face!

 

Sabbatical postcard … coffee on the side road

coffee and pot 3bYears of consulting does develop fantastic time management skills – so being on sabbatical from consulting to work full tilt at PhD research, on accountability of the UN Security Council, still leaves time for a side trip to other aspects of my long, long standing work on decision making and governance!

For some months I have been collaborating as part of an eclectic group with common ground in the law of competition. Our project looked at the financial services industry in Australia – that project for the Centre on International Finance and Regulation culminated last week in the release of the project report.

This week, a working paper that I co-authored with project leader Rob Nicholls, entitled The Nature of Competition in Australian Retail Banking, was wrapped up as another project outcome.

Once more with feeling, the take away for me relates to the importance of both the means and the ends engaged in any decision.  For example, when the Australian Government’s then-Treasurer (and later Prime Minister), Paul Keating, in the late 1990s initiated the so-called ‘pillars’ policy for financial services in Australia, his intention was to ensure separation of the four largest banks and two largest insurance providers of the day.  His purpose was to maintain/engender ongoing competition in the market for financial services, and that seemed on point at the time.  Two decades and a(nother) GFC on, trundling on with the same approach now has the effect of entrenching the four largest banks in a very cosy oligopoly.  Even if they break no law:

  • Their business models are highly homogenised and product innovation is ho-hum, which hardly augers well for the role that banking plays in enabling the overall productive effort in the economy.  However, it also means that a problem in any one could easily be contagious for the other three, and the industry is so concentrated that even all the smaller players together couldn’t take up the slack if a major bank(s) had a very bad time of it.  Think in terms of how much worse the Ansett collapse would have been if Virgin had not yet been fully operational and able to ramp up rapidly.
  • Customers can hardly tell the difference between the ‘four pillars’  and, largely, can’t be bothered with the inconvenience of switching service providers, even in the face of very ordinary customer service.  This means that it is also difficult for any other player to get a good toehold in the market despite far better products and service, so absent some policy to engender competition what we’ve got is what we’ve got.

Looks like there is plenty more policy development work there for an enquiring mind, but the lesson is also there to be had for decision making in a business.  Is there a strong, evidence-based connection between the strategies adopted by your board and the outcomes that they seek for the enterprise?  Answering that question factually should be the first priority for any planning effort, and no ‘strategy love in’ should go ahead without that information – plus a commitment from the board as to the ends they seek, so that the most appropriate means can be engaged.

Cheers, Carolyn

Coffee on the (side) road …

CIFR Banking report cover 26 August 2015

On sabbatical from consulting and deep in the world of academe, in her guise as a higher degree research student Carolyn Evans has returned to her microeconomic roots – taking a side road on something of a busman’s holiday from the hard slog of writing her PhD thesis.

One of the co-authors of a report for the Centre for International Finance and Regulation (CIFR), Carolyn contributed particularly to the chapter on the nature of competition in financial services, and also to the chapter on facilitating competition in financial services.

Carolyn heartily endorsed the principal recommendations of the report – in particular, to do away with the so-called ‘four pillars’ policy in the Australian banking industry, and to facilitate better customer experiences by creating account number portability.  The report also gave serious consideration to the impact of crowd equity funding within the structure of the finance industry in Australia.

CIFR launched the report on Tuesday 25 August.

PS see also this related piece on The Conversation from October 2015:

Boring and protected: fifth pillar needed to get Australian bank customers moving

Congratulations!

Sharna Wiblen Sisson, Consultant at ThinkEvans

Sharna Wiblen Sisson, Consultant

 

After more than five years and two children, we are delighted to congratulate Sharna on the conferral of her PhD.  Her thesis is entitled ‘Talking About Talent: Conceptualising Talent Management Through Discourse’.

Her research ’employs discourse analysis in order to understand how the concepts of “talent” and “talent management” are socially constructed within an organisational setting and the ways in which these are then brought into being and enacted [and] highlights that the meanings attributed to these often “taken for granted” concepts is not commonplace or self-explanatory, but rather that they come about via ongoing processes of negotiation within organisational settings.’

That one is soooo worth a coffee or two, and it’s our shout!  Congratulations Sharna on achieving this important career milestone.

Coffee makes planning go ’round

Carolyn Evans and Tanya van der Wall share our guide to keeping planning in perspective as a means to an end – all the coffee in the world won’t fix a governance and planning process that doesn’t keep “eyes on the prize” of realising the organisation’s purpose.

Governance cycle management slices Copyright ThinkEvans SMALLER

Click the governance wheel for a larger image

Three decades since Michael Porter identified the ‘lost in the middle’ problem, our hearts still sink on a regular basis when one board member says ‘we’re a premium provider, and we’ve got to deliver on that’, even as another is saying ‘we’ll fail if we don’t beat the market on price’. Porter groupies would quickly explain that either a quality led strategy for premium positioning, or a price led strategy for mass market appeal, can work – but it is a rare day on which they work for a firm simultaneously, in the same market and for the same product.  Even having two product ranges (one premium, one mass market run by the same entity calls for masterly decision making).  More often, that lack of coherence in objectives leaves the organisation lost in the middle of the market, neither fish nor fowl nor good red meat, as the saying goes.

And that holds true whether or not the organisation’s purpose is commercial. Think about a ‘not-for-profit’ enterprise in terms of being ‘not-for-loss’ – it must live within its means and still deliver on its promises to stakeholders.  Lack of focus and agreed outcomes is seen in over-delivering on some promises which unavoidably leads to under-delivering on others, including selling short future stakeholders as the organisation fails to put away reserves for the inevitable rainy day.

With so many boards including individuals who are also executives in some other place, getting resolution on such issues is more complex and difficult than it first looks (especially for the chair!).  But it’s undoubtedly essential – this kind of clash can be an example of thoughtful dissent that aids the board’s canvassing of all the relevant issues of governance and planning, or it can degenerate into endless rehearsals of the same issues with growing animosity – and a growing likelihood of reaching consensus only by exhaustion.  So such strategic questions need a definitive resolution that is able to be carried forward by management.

We have found parsing the process into this cycle, as shown in the ‘governance wheel’, helps to clarify what question is being answered, and by whom, as the planning process unfolds.  At each step on the wheel, we are asking whose role is this and what outcome is needed, whether that was delivered and if not, what to do differently on the next cycle. Pretty simple, right?

Get a coffee, have a look and let us know your questions.

 

Sabbatical postcard … coffee on the road to international peace & security

CME July 2014In the first public airing of her thesis research, Managing Director Carolyn Evans this week presented her work at the Australia and New Zealand Society of International Law Postgraduate Workshop, held in Canberra on the eve of the Society’s annual conference.

Selected from higher degree research students at universities all over Australia and New Zealand, the workshop offered just a dozen students the opportunity to interact with mentors and colleagues.

Using her experience in governance for government, commercial and nonprofit organisations, Carolyn presented her preliminary take on the conundrum at the centre of her work.  That is, how to view the UN Security Council not as part of a quasi-world government (that needs to be reformulated in order to establish precise accountabilities), but as an organisation that already has accountabilities on which it cannot be said to be delivering (for example, to its members as would be implied in a general model of association).

Since the Security Council has responsibility for maintaining international peace and security, and in particular for regulating the use of force in international relations, the stakes could hardly be higher when they fail to deliver.  Carolyn’s research goes further to look at whether UN members have done enough to play their part in developing an accountable pattern of conduct by the Security Council – however the UN might be described as an organisation.

Taking those ideas through to a completed thesis, due in 2017, calls for a whole lot more coffee!

Sabbatical postcard: coffee on the road, for one

Battered blue helmetWhen it comes to decision making and governance, there is probably no bigger stage than that of the United Nations.  There are many other organisations that may well have more, or more obvious, influence – like multinational corporations that design our lives with their products and redesign our planet with the impact of their production processes – but when it comes to high stakes decision making it would be hard to find a more public forum that involves as many countries.

But since apparently there are a few amongst us who don’t hang on every UN development as news, as the year starts it is worth highlighting what was possibly the most remarkable moment of 2013.

In a seminal moment for dissenters, in October 2013 Saudi Arabia was elected to the UN Security Council but within hours indicated that it would decline to take up that position.

When later providing a formal notification to that effect, the Saudi Foreign Ministry decried the Security Council’s inability to resolve the Syrian civil war and Israeli-Palestinian conflict, or to convene a conference on creating a Mideast zone free of weapons of mass destruction.

Coffee for oneTo say that this action is unprecedented hardly does justice to this decision to stand so totally alone.

Many boards have to discover the hard way the value of actual debate and difference of opinion – as some spectacular corporate failures in Australia will attest, ditto the rest of the world.

It seems that the Security Council is no different.

Sabbatical postcard: a dash of dissent in your coffee on the road

coffee colours on silver (1)For those of us fascinated by leadership and decision making, Australia’s first time in three decades as UN Security Council President has been, to say the least, underwhelming.

Any whelm was certainly hard to find in the one topic put forward for formal debate by Australia in the Presidential role – small arms.  Not unimportant in its own right, it is hardly the fodder of a defining moment, or even anything very distinctive, in UN decision making.

In fact the whole thing was somewhat overshadowed by the national election that saw the (second) Rudd Government dumped in favour of a Coalition that has rather lacked enthusiasm for UN activities.

That also left the small arms debate sponsored by Australia under the Presidential guidance of (new) Foreign Minister Julie Bishop, rather than Kevin Rudd, whose interest in all things foreign relations could have provided a great deal more engagement (even if no more interesting topic for the debate).

However, the month of September under Australia’s presidential gaze was not a dead loss, thanks again to that debate topic.  In a rare moment of non-veto dissent, the resolution on small arms proposed as part of the debate was passed 14 votes in favour with one abstention (Russia).

Regardless of the quality of their reasoning, or the true nature of the motivations behind their abstention, this shows that dissention among decision makers will not cause the end of the world as we know it!

Cheers, Carolyn

 

Sabbatical postcard … coffee on the “crowded” road

On sabbatical from consulting, while travelling in England for her PhD research Managing Director Carolyn Evans has discovered a whole new meaning to fighting the crowd to get coffee.  Staying at the University of Warwick in Coventry, this was the crowd scene at the local coffee spot on the banks of the River Sherbourne.

Having also spent several days at Durham University, next week Carolyn will be at the Law School of King’s College London for a two day workshop on ‘Strengthening Security Council Accountability: Opportunities and Challenges’.

Coffee with ducks medium

Coffee on the (long, long) road

Carolyn Evans CSC, Managing Director

 

Embarking on the long, long road to a PhD, our Managing Director Carolyn was this week advised she will receive an Australian Postgraduate Award (APA).  Her scholarship is tenable for three years.

Carolyn was also awarded a further scholarship by the University of New South Wales Faculty of Law, given to top-ranked APA recipients in recognition of excellent prior achievements.

Carolyn’s research will explore governance as it applies (or not!) to the United Nations Security Council, using a diversity of analytical techniques to look again at the vexed issue of Security Council accountability.

Now that will take some serious coffee!