Real photo. Real office. Real role. Real person. NOT the company in the story.

The conversation started pleasantly enough with discussion about stable, risk-managed growth, careful operational controls, market analysis, future targets, engaging customers, and so on. And then things got ugly. (Not really, but they may as well have.)

The discussion shifted to “operationalizing” these predictable ideas when the assembled executives began describing investments in personnel, infrastructure systems, process improvements, and some product-market fit and marketing ideas. I must’ve been failing at my poker face when one of the executives asked me, “what do you think?”

Realizing my facial expression was contorted, I relaxed. In reality I was thinking: None of this will work. They’re not making any changes to how they operate. It’s all old-school — very old school — and worse, it’s nothing better than more of the ‘more of the same’ that worked to get them this far, but wouldn’t get them any further. They need to join the rest of us in the 21st century. Their world is about to get rocked by some upstart that simply does better with digital technology than they do, and by the time they realize what’s happening it’ll be way.too.late.

Despite being paid to bring up ideas they might not think of themselves, I knew better than to blurt that out. Nonetheless, what I said instead was the first shovelful of dirt out of the ditch I was digging myself into, “I was just putting some thought into what the enterprise architecture would need to be to make all these great ideas happen.”

Exec: “What do you mean?”
Me: (to myself) Oh sh!t!

The problem wasn’t that I didn’t have an answer, the problem was that things were worse than I thought. They didn’t know what I meant by “enterprise architecture.” Which — not coincidentally — also meant they didn’t know they were about to be blindsided by a completely different way of looking at the world now, in the year 20-bzillion — in digital years. These people were still thinking in the same terms they learned in b-school and experience in the digital stone age of 1987 or something.

“Well,” I started, rapidly assembling words to make them look as good as possible, “I assumed that you would be carrying out these strategies digitally. That the changes and investments you’re discussing would all be focused on creating and operating from a digital platform that integrates the customer-facing sides of the company with the inwardly facing parts of the company. You know, to improve efficiencies, customer experience, and reach more people.”

Apparently, that was not what they were thinking.
Nor was I surprised. At this point I had been expecting this “confrontation” of sorts.

The fact is, companies in this scenario are far from alone. These sorts of revelations are happening in boardrooms all over the world. They’re especially prevalent in industries and businesses that can be characterized as “safe” or “mature.” Exactly the attributes of traditional private equity (PE) portfolio companies.

To stay competitive, PE portfolio companies are finding that even stable, mature businesses — despite their relative size or youth — are not immune from having to look at a complete revamp of everything that got them to where they are. But the PE parent firms are hardly in a position to guide their portfolio companies along a digital transformation if they are also stuck in their own digital stone age.

Why? Because solutions follow capabilities. Companies that don’t have capabilities can’t create solutions using them. Traditional remedies for value creation are no longer sufficient. What’s worked thus far will abruptly will stop working (if it hasn’t already). The digital competition is often too small to register on market radars until it’s too late and the upstarts blow a hole in the side of a PE firm’s mature hull.

Exponential technology applications are disrupting mature industries attractive to PE in the past. It’s not just AI and automation. The fundamentals of these industries are changing. Technologies are enabling capital-efficient “digitally native” business models that decouple assets and people from the transactions that leverage them. The very nature of modern firms is changing; rapidly building a global businesses with a handful of people. Instagram was acquired for $1B with just 13 employees.

From a strictly market vs. operations perspective, companies experiencing margin erosion (or growth impediments) are not keeping up with some change in the market. A nerdier way of saying it is that they’ve optimized their business for something the market no longer values or responds to (except to punish the company with higher costs or lower sales).

Companies in the crosshairs of the conundrum are in the PE sweet spot. Interestingly, Ernst & Young’s 2018 Global Private Equity Survey found that “19% of [private equity] CFOs said their firms have neutralized margin erosion by strategically cutting expenses and growing topline revenue.” And the digital investments they’re making are heavily in management reporting/portfolio analysis, and valuation technology.

Despite this, PE firms themselves “find implementing technology very difficult…” and “[t]he most challenging systems…include…fund accounting [and] …management reporting.” Their own core competencies.

When I read this, I see PE firms using old-school methods to improve performance, rather than truly becoming more digital. Sounds familiar. We also see that they’re looking at speeding up and optimizing their own financial operations and it’s not really working. Investing in systems that have little or nothing to do with customer engagement, adding market share, or product-market fit — which are often their portfolio companies’ usual challenges.

Put bluntly, PE portfolio companies are in a Catch-22. They are PE portfolio companies precisely because they’re “old dogs.” But not only are the “new tricks” already “old tricks” for competitors, the PE firms guiding them are playing catch-up on the same issues. With the current growth boom in PE firms, as reported in the Wall Street Journal, this was going to become an even bigger problem — faster.

In reality, no markets are safe. Digital age companies have already disrupted previously believed “safe” industries such as lodging, work space, and transportation leaving legacy companies scrambling to identify new value streams.

My experience in the boardroom that day was captured perfectly in the opening to the 2017 e-book by the Post Lean Institute, Post-Lean Thinking: A New Vision for Corporate Innovation, in which they wrote, “The technology disruption we see everywhere today is remaking our world … at a faster pace than today’s organizations are equipped to deal with. Humanity is transitioning to a post-industrial civilization, but our management thinking is still shaped by assumptions that go all the way back to the Bronze Age.”

Hope is far from lost. “Safe” firms have a depth of assets their more digital competitors would kill to have. Mature companies can leverage the fruits of their stability and maturity: data and existing customers. This is how the digital upstarts are succeeding against established firms. And, it’s how PE firms (and portfolio) can fortify their positions and beat these upstarts at their own game.

There’s no technological reason by PE firms and their portfolios can’t leverage data, connect with customers, and decouple capital from operations. The decoupling part may not be an immediate option, but data science and customer relationships have enabled significant leaps in business models and competitive advantages that PE firms and their portfolio companies are in excellent positions to embrace.

PE firms can help their portfolio companies dive into the wealth of data about themselves and their customers to analyse, learn, and take action. This takes a digital platform and an integrated enterprise architecture. Once in place, this data becomes a seemingly endless pot of gold.

PE firms and the companies in their portfolios are well-positioned to make transformative investments in their digital ecosystem to leverage their existing data and access to customers to become digital platforms from which to operate. Failing to make these transformations keeps many doors wide open for highly nimble, more digitally immersed competitors to pad over and eat from their bowl.

In the first post I opened with a published list distilled from 101 start-up postmortems of start-up failures that identified the most common “causes”. The gist of that post was my own list of five common mistakes many start-ups make. Mistakes readers can avoid once being aware of them.

For this post I explain why the listed mistakes of the first post creep up on unsuspecting companies. Tell me if this sounds familiar to you: despite seemingly “proactive” monitoring by company executives and investors, the mistakes tend to go unnoticed until too late to prevent drastic measures (which are not always enough to save the company). And thus the search for an eleventh hour miracle begins. We want to avoid that search.

In the prior post I noted that one problem with the original list of causes or reasons is that most of the strategies for avoiding failure related to these causes are nothing more than some variation on the theme of, “pay closer attention.” But paying closer attention is not actually doing anything differently that would prevent the failure.

There’s nothing inherently wrong with the original list. The items on the list are not controversial. That list indeed includes ways in which start-ups fail. In fact, these failure modes are fairly well spot-on.

Except that they’re wrong.

The items on the list aren’t wrong, per se, it’s that the description of what the list is that’s wrong. The list doesn’t have any reasons on it at all. They’re symptoms.

This is important. I’m not just splitting hairs. If people only look at these symptoms as though they’re causes they’ll only get more of “paying closer attention”. Quantum physics aside, more scrutiny doesn’t necessarily yield better results. Running out of money isn’t a cause, it’s a symptom of something else that “caused” the company to run out of money. Blaming a person for bleeding after a paper cut is looking at the wrong end of the events. The clock running out in the game is not why there weren’t enough points on the board. You’ve got the idea.

We tell our kids to “be careful” when they go out and play. Does a 6-year-old they really know what to do to “be careful”? “Don’t play on the ice” or “don’t run in the street” is far more actionable. How can companies conduct business differently to avoid the reasons? “Don’t fail” isn’t enough. I’ve appended actual reasons to failure symptoms:

1. Failure to get an MVP is actually Failing to have a process to inform you of where your are relative to your MVP.
2. Running out of money or time is actually Spending it on the wrong things.
3. Not getting to Beta is actually Overloading work and not having a workflow process to prioritize and coordinate all the work and get it all done.
4. Having the wrong people is actually Knowing what needs to be done and whether the right people are doing it.
5. Too little revenue or lack of traction is actually Ineffective feedback from the market.

Compared to knowing what product ought to be built, building products is easy. It’s easier to track cash flow than to determine what to spend money on. An endemic failure to effectively prioritize doesn’t just show up in one place.

The belief that there’s always time to do it again (or to work late into the night) rather than to take the time to plan on how to do it correctly the first time shows a lack of a the company’s self-awareness about their capabilities. Dig a little into a company about it’s self-awareness on capabilities and you’ll likely learn that they don’t see themselves as a system with many connections and dependencies.

Companies don’t just fail to gain traction. (Assuming they have a viable product) the failure is in how they (didn’t) organize, validate, and operate an effective system to gain traction.

By now you’re familiar with the concept and the book, The Lean Start-Up. Eric Ries actually gives away the “secret sauce” right on the cover of the book. (See underlined words in book image.) The challenge is that “use continuous innovation” is the system and it’s not a trivial thing to set up! That system includes several elements including data gathering, decision-making, experimentation, learning and so on.

A poorly kept secret in the investor world is that investors don’t invest in products, they invest in people. These days investors are more likely to give money to a spunky, scrappy, relentless founder of a company without a working product than they are to a fund a founder with a product who even hints at equivocation. If investors like a product but don’t like who’s running the company, they’ll find a way to get the product and dump the baggage. They will not move forward with a founder who lacks the backbone to lead just because that person came up with the idea. It’s a scrappy founder who is more likely to recognize (and do it sooner) when their original idea won’t work and it’s time to change direction. The spunky founder will find the seed within the idea with which they can pursue success. The relentless founder wants to succeed and will do so. The product can’t do any of these things.

The kind of companies investors want to invest in are companies whose founder(s) know what needs to be done and who they need on their team to do it. Investors want to invest in companies with all the assurances of maturity. A money-making system is a much better investment (and sign of maturity) than a shiny product alone. Hawkishly watching financials but not changing the financial drivers isn’t maturity. But a systematic approach to understanding why the financials are what they are? That’s maturity.

Start-Ups fail via any number of symptoms. The cause is nearly always due to (lack of) maturity.
Do you agree? I invite your thoughts.

A few months ago much ado was made about the “top 20″ reasons start-ups fail. That list was distilled from a collection of 101 post-failure analyses. I have no argument with the list or with the smart people who performed the analysis. I do have a few nits to pick with the math, but at worst it’s a starting point for a conversation. At least this conversation. This post isn’t about that list anyway … er … exactly.

I have a list too.

By coincidence (you’ll have to trust me on this) I found myself with a list as well and there happens to be a lot in common with the prior (more famous) list. I’m not claiming my list as a “top X” list. These items are not necessarily the top five mistakes. I’m merely stating that the five items in my list are among the mistakes start-ups make which lead them to fail.

A difference between a list of top reasons is not the same as a list of top mistakes. Knowing the “cause of death” doesn’t necessarily prevent the cause. This list on the other hand might help a company or two recognize a bad trajectory in time to do something about it.

Five Mistakes:

1. No deliberate, rational, or validated process to measure how the company is progressing towards an MVP.
2. No deliberate, rational, or validated process to prioritize time or money.
3. No deliberate, rational, or validated process to manage and coordinate the work. 
4. No deliberate, rational, or validated process to identify and assign all work to be done.
5. No deliberate, rational, or validated process to collect timely feedback from the market or product developers.

Process-haters take note: Nowhere does this list say a company needs a lot of process or overhead. Nowhere does this list imply that process need to be overly structured or formalistic. To be blunt, it’s not enough to say, “yeah, we talked about that.” Start-ups need to actually think about it and come up with a way to do something about it.

How often have you been involved in any effort (start-up or volunteer effort) where there was a meeting about something and a lot of discussion around what needs to be done but nothing actionable or follow-through occurred after the meeting?

THAT. That’s what you get with, “yeah, we talked about that.” 

Who was supposed to make that happen?

The process need be nothing more than an agreed convention among the staff for how decisions will be made around important stuff like:

• What’s the product buyers want? How do we know?
• Is this the best thing we can be spending time or money on now? Based on what?
• Who’s doing what? Do they have what they need? Are they the right person to do that?
• How are we going to do that? Is that a guess?
• How do we know we’re working on the right things?

Seriously people. Expecting these questions to answer themselves is not going to win any respect from serious investors. And these are easy questions. But they might not be easy if you’ve never tried to come up with a real way to answer them.

Here’s a challenge: Ask everyone on staff to answer those questions anonymously on index cards or sticky notes. Collect the answers and compare.

Don’t make me tell you “I told you so.”

In the next post (which I’ll link to from here once it’s up) I’ll take this line of thinking one step further. What if the causes of start-up failure aren’t really the causes?

He was trying to figure out how to prepare for balancing resources and commitments and that he was stumped by a Catch-22: In the future the company would need to balance customer service with new product development. However how they currently handle these roles is not how they would handle them in the future. So merely scaling the current approach would not be relevant. And even the idea of envisioning how they would handle this balance in the future requires that they know something about it–which they don’t–means that any assumptions are baseless conjecture. Therefore basing plans on these assumptions could be foolhardy as they won’t have confidence in any modeling of the future state from which to run projections.

Customer service metrics at Zappos where metrics are used to balance workload not enforce response speed.

This is further confounded by the fact that they’re currently too small to even have a balancing problem yet!

This is the type of question that typically only occurs to people baring the scars of prior experience to recognize it. That this young COO was already asking it is a good omen (for their company). In fairness, the company also has a seasoned CEO and a cadre of competent advisors. Not to diminish his big-picture forward-thinking, his other questions made it clear that scars or no, this guy was cut from the cloth of operations people.

When the seemingly obvious data isn’t available we merely have to widen our view. We need to see the overall effect of the situation’s dynamic and find the data that helps us to understand that.

In this case, the data turns out to be fairly simple (and abundant). Their current situation–very common, by the way–is that the COO is playing the role of customer service handler. This technically competent COO can handle many of the customer service inquiries. He rarely needs to “escalate” issues to development-types when the matter is truly in the weeds of the product.

Despite the rare need to escalate he could already see that this was not a scalable approach. He also saw that they were a long way from growing a distinct customer service capability and even further from growing a tech support group distinct from the product development group.

For the time being the most likely approach would be to continue to use product developers to field only select field issues. The most likely next evolution in the company would see growth among product developers and testers long before it saw growth in specialized skills or capacity to handle customer service calls. Therefore the most likely customer service solution for the next while would rely on figuring out how to allocate developer time. How much time would go towards handling customer matters and how much time to continuing their work on new product development. In other words when planning the company’s ability to deliver new features and products, instead of assuming developer time is always used for new stuff, some percentage of developer time would be reserved for customer services.

To do this he would need to better understand how much time product people spend (lose) on dealing with customer service issues escalated to them. Immediately a challenge appears: How does he collect the developer time consumed by customer service issues without disrupting them?

He could survey them over lunch. He could try to sit around capturing data–old school. But I advised him that none of these are necessary. The answers didn’t lie in how much time the developers were spending on customer service issues. The answers are in how many service issues they get.

All it takes is to take advantage of data already at hand and easily available. The data the COO can observe for himself. Since he handles the issues himself and decides what gets escalated he had access to all the data he needs.

The gist of the necessary data is straight-forward: Customer service needs arise from their fielded products. Therefore, you know how many systems|units are deployed. From these you can measure:

• # customer issues
• which customers have issues
• the types of issues customers have
• how long it takes you to deal with the calls
• # of issues you need to escalate
• types of issues you need to escalate
• how long before you hear back from the development people
• whether or not you needed to rattle cages to get an answer (THEN how long before you got an answer after rattling cages)
• contrast requests for new features to issues with existing features

These are just the beginning. Basically, aside from calls requesting new features, most customer inquiries are due to some shade of quality somewhere in your workflow. The best way to scale customer service is to start by minimizing quality issues that escape into your customers’ hands.

The end-state, eventually, is a product development process  instrumented to identify the load balancing necessary as a function of quality, not only volume of fielded product. Surely as more product is fielded they will need to scale the ability to respond to customers, however, if fielded product is the only metric it will never be right. The need is to be predictable and the lack of predictability is due to variation in quality (whatever way one chooses to define that). Scaling without understanding this variation will be an inefficient and expensive crap shoot.

Perhaps this rationale is prevalent among many software companies? I don’t know. But if so, it would certainly explain a lot of observations I’ve had in over 17 years of working with software companies around the world. I agreed that some software companies don’t need a COO. Yet.

In his defense this entrepreneur is a mostly one-man-show with a narrow niche. He’s handling most of his company’s needs single-handedly–just like I did when I ran a mostly one-person consulting show. I didn’t need a COO either. That I’m an ops expert may have delayed my on-boarding of a COO, but I could nonetheless also see a day when I would have needed a COO had I decided to expand my consulting services, productize certain services or need to operationalize the business to scale it.

I asserted the need for a COO with a few fast questions (off the top of my head):

1. Who in the company will take a leadership role in ensuring that all the executives are on the same page and operating in a coordinated manner?
2. Who in the company will take a leadership role to manage capacity, capability, availability and ensuring resources can meet commitments and vice versa?
3. Who in the company will take a leadership role to create a rational workflow that everyone is on?
4. Who in the company will take a leadership role with delivery in the center of their mindmap?
5. Who in the company will take a leadership role to look at how everyone and everything works together?
6. Who in the company will take a leadership role operationalize the business to think forward about how the company will look and run when it’s successful and manage the growth as they scale?
7. (In fact) Who in the company in a leadership role won’t get distracted by sales, funds, or technology when any or all of these daily priorities demands attention and keeps people focused on short-term urgencies and shifting attention from satisfying long term balance?

This last point was really the crux of the matter. Especially among startups and often prevalent in software companies, short-term issues and needs demand a lot of attention to survive to live another day. The lack of physical inventory does not preclude the need for systemic leadership “glue” to hold everything together and keep things running smoothly. Looking at my questions, none are tied to physical inventory. All are about people, how the business runs, and how the business sets-up to be successful while they’re growing and once they get big.

The notion of success being a company’s biggest risk is practically cliché. But it wouldn’t be cliché if there wasn’t a lot of truth to it. How does a company go about planning for operationalization of their business? How will (or do) they balance the need to work with existing customers against investing in new products and features?

Several successful software entrepreneurs told me in one way or another that startups often need a COO much sooner than they actually get one (if ever). In fact, it’s often only after experiencing a significant amount of pain (or outright failure) that they realize the need for a COO.

“In a technology product company,” says Mark Wesker, “a good ops person can be invaluable, especially if they have a strong technology or product background.” Mark is CEO of Workspace.com and former CEO of Sequoia Software which he sold to Citrix in 2001 for 9 figures. The reason, he says, is that “[it] leaves the the CEO free to focus on what the CEO does best, be it sales, marketing, product, financing, and helps support the product and marketing organization with a level of discipline and checks and balances necessary to keep things moving in the right direction.” Mark elaborates by adding that “[an] ops person with the bonus [of a] tech background is just perfect because you get financial discipline, but with an understanding that product companies are only successful if they build great products, meaning schedule and budget are sometimes sacrificed for quality and innovation.” Want proof? “Just ask Apple,” he concludes.

Operations people are often process and methodology experts. “I can look back and point out mistakes that probably wouldn’t have happened if we’d have had concrete project management practices,” says Alex Menkes, CEO of ADASHI Systems. “As a growing start-up we don’t have a good way to know what we could do or when we could get it done. A COO in the executive suite would have been able to step in and say, ‘don’t make that commitment, this is what we can do and this is what we can’t',” Alex mused. He explained that a challenge for small companies is their ability to afford an experienced COO. Alex is on his 4th startup. He notes that his prior experience with starting companies gave him an awareness of the value and benefits of having a good COO earlier than later.

I found this to be a recurring theme. Not only are COOs necessary for software companies, but they’re necessary sooner than later. The challenge, especially for start-ups, is having the foresight of experience when you don’t yet have the experience.

Flying over a volcano on the island of Hawaii. Source: Bill Fox and Hillel Glazer

What I learned about thought leadership and culture from a volcano.

Days before I left for the island of Maui this past summer, Dr. Liz Alexander asked if I would consider writing a guest post about thought leadership for her new blog.  Since her writing and thought leadership have greatly impacted me, I was delighted and honored by her invitation.  Yet I never could have imagined how this business trip would impact what I’d write.

I was on this trip with fellow consultant and private pilot Hillel Glazer.  When we travel together, Hillel and I look for opportunities to explore the area by air.  On this trip, we decided to fly from Maui to the island of Hawaii to overfly a volcano.

I’ve since realized that volcanoes and thought leaders have a lot in common.

Unfortunately, I find that what’s passed off as thought leadership is, more often than not, a slight variation on what everyone else is saying.  Most “thought leaders” are simply piling on to the favorite flavor of the month.

Why is this so?

Is this because we don’t agree on what thought leadership truly is?  Or is something deeper going on?

I believe many leaders do not understand true thought leadership.  And, I believe a deeper reason exists for this reality.  That’s why I selected Tweet #13 from the book, #THOUGHT LEADERSHIP, to address in this post:

Thought leadership is the willingness to go one way when most people are going the other. Does your culture support that?

I believe many “leaders” aren’t willing to go the other way because their culture doesn’t support speaking their truth.  They’re unwilling to speak their truth because they are afraid of the consequences.

True thought leadership is a lot like a volcano.
How many volcanoes have you seen?  A volcano is a distinctive feature that stands out clearly from the surrounding landscape.  There’s no mistaking a volcano for something else.

Most of what I see being passed off as thought leadership doesn’t stand out like a volcano at all.  It barely makes a ripple in the deep abyss of information that’s available to us.

Is what you’re calling thought leadership distinctive?  Is it easily distinguishable from everything else?

A volcano creates something visibly new and changes the landscape.

Lava flowing into the ocean on the island of Hawaii. Source: Bill Fox and Hillel Glazer

When a volcano erupts, a new creation is brought forth.  Lava flows.  It flows seemingly naturally and effortlessly.  In the case of our trip, we could visibly see new land springing forth in paradise.

When people can freely express their truth, it flows naturally and effortlessly.  And it has enormous power to create something new.

Is your thought leadership creating something fresh and new?  Will it change the landscape of your organization or the world?  Or is it more of the same?

A volcano doesn’t worry about what others think.
Let’s face the facts: Volcanos erupt, and there’s not much we can do about it.  A volcano doesn’t care what others think.  Nothing stands in its way for very long.

True thought leadership must be willing to be expressed even when important values, practices, beliefs, etc., might be challenged.

Do you say what you believe, even if it calls into question important values, principles or beliefs?  Or do you hold back because of what others might think?

A volcano is supported by a powerful but unseen structure.
People commonly view a volcano as a tapering mountain, spewing lava and poisonous gases from a crater that’s bubbling with molten lava.  But, underneath and unseen is a much more complex and powerful structure.  A structure exists that forms and directs hot molten lava under enormous pressure towards the surface.

Your culture is a powerful but unseen structure too — an unseen but very powerful structure of beliefs, convictions and traditions that forms the foundation of your organization.

Are you recognizing the powerful role of culture in your organization?  Are you nurturing and shaping the culture to support your organization’s mission?

Passion and purpose fuel your culture just like lava and powerful forces fuel a volcano.
Hawaiian mythology tells of Pele, the goddess of fire, lightning, wind, and volcanoes.  Pele is known for her creative power, passion, purpose and profound love.

Does your culture reward creative power, passion, purpose and profound love?  Does your culture allow—or, better yet, encourage—people to express these same qualities?  Does your culture allow your people to speak their own truth?

A culture that allows people to speak their truth enables more than just true thought leadership.  A culture where everyone can speak their truth allows collaboration and co-creation to flourish at all levels.  This creates an atmosphere and environment where everyone can engage more fully to contribute their own unique passion, creativity and intellect.  Isn’t this what we ALL want anyway?

How about you?  Are you able to speak your truth?  Do you fear speaking your truth?  If so, what would it take to change that?  And what sort of true thought leadership would flow through you if you did speak your truth?

I’m looking forward to hearing anything that comes up for you after reading this post.

Author’s Comments:

This improbable flight to a volcano was made possible by amazing friends and co-creators.  I’m so grateful for their contributions.  First, Dr. Liz Alexander planted the seed that inspired me to share my thinking about thought leadership and catalyzed an adventure.  On the way to Maui, Sue Elliott, Editor-in-Chief of Law of Attraction Magazine, coached me in her Magical Transformation Intensive the day before the flight.  She also contributed her superb editing skills to this post.  Then fellow consultant Hillel Glazer, CEO of Entinex, Inc., flew us safely through several challenging weather systems and cloud formations on the way to the volcano.  Along the way we faced several moments of truth.  Those moments of truth and related discussions informed this post.  Next, my web strategy and content advisor Crystal Street, Visual Storyteller, reminded me (gently) how to write with impact.  And finally, Paul McMahon, Principal at PEM Systems, and Jeff Helman, Transformational Linchpin at AEGIS.net, both encouraged me to deepen the conversation.  How does it get any better than this?

Author, Bill Fox at Maui Aviators

About the Author:

Bill is leading a conversation to catalyze people and organizations to be more conscious, collaborative, and co-creative.  He collaborates with industry experts on the best strategies to improve organizations at 5minutespisuccess.com.  Taking a higher perspective on this work has led to the creation of Higher Perspectives to Transform You and Your Workplace at billfoxstrategies.com.  He shares his passion for flying and a higher perspective at foxhighperspective.com.  View more pictures from the flight by selecting Recent -> Hawaii Volcano from the menu.  Bill’s work is supported by the visionary management team at AEGIS.net where he can speak his truth.

The Problem
Over the past 20+ years I have witnessed a repeated and troubling pattern that occurs far too frequently. The recurring pattern I’m referring to is when organizations choose to settle for a “silver bullet” solution. With the hope of quickly solving burning and persistent problems with delivering quality product in a timely fashion, many organizations are blindly adopting a “cookie-cutter” approach that often ignores or adequately address fundamental problems.

I’ve witnessed numerous process improvement initiatives such as Agile, CMMI, Lean, Project Management Offices and any number of other improvement related initiatives that are started and stopped often in one failed initiative after another… (read more)

The web page for it is: http://goo.gl/lUWxc.

To get the podcast directly, get it here: http://goo.gl/m8K0G

The best way to be able to distinguish a quality management system is in the manifestations of quality in everything an operation does, not in a distinct entity.  But, who could blame them?  The most likely cause for this behavior are the auditors, assessors and appraisers of such systems.  They frequently want to see tangible items that result from a “quality system”, and too often, they want them labeled after the names they’re used to seeing.  So, naturally, organizations wanting credit for having a quality management system of a particular stripe make their efforts as obvious as possible to these outside onlookers.

A Southwest Airlines gate agent is able to tell me
what the top customer suggestions are.

I could spend trillions of electrons waxing rather unpoetically about the ills of the very people empowered to review the outputs of quality approaches being the causes of such stupid wastes of time and money, but that would certainly side-track me from my primary message in today’s post.  The good news is that some operations are realizing on their own what stupid wastes of time and money such pursuits are and are seeking ways to address the quality requirements while also having a positive benefit to the company’s performance without contorting their operation to suit the idiosyncrasies of a particular third-party’s way of seeing the world.

A quality management system should show up in everything the company does.  Not as a separate entity.  Sure there would be some obvious, observable, tangible emissions from such a system such as reviews, problem-solving meetings, metrics, training, and so on, but for the most part, what should actually “show up” are processes, procedures, tools and resources that actually allow/cause the operation to perform well and produce a quality product or service.

The “quality management system” would be the systems thinking and the systems engineering of everything that makes the products and services of an operation come to fruition.  Such a system would produce everything used and done by the company to make the company work.  Being able to point to explicit things and say “that’s our quality management system” would be a lot like pointing to a single wire pulled from the engine compartment of a car and saying “that’s our vehicle”.  It’s doesn’t work that way with cars or with quality.

The next time I fly on Southwest Airlines, when there’s little else going on at the airport, I’ll ask a gate agent whether or not he or she knows about their quality management system.  I may even ask a flight attendant the same thing before a flight.  They might know.  And if they do, it’s probably because of their training.  But chances are, they will look at me blankly because I’m asking a ridiculous question and they are too polite to ask which planet I’m from.  At Southwest, how they work is because their quality management system is what creates the work they do.  It’s the epitome of quality being in everything.  That’s why they are a high performance operation. 

This first entry is what most first entries are supposed to do: welcome you to this blog.  Since the publication of this blog coincides with the publication of the book, High Performance Operations: Leverage Compliance to Lower Costs, Raise Profits, and Gain Competitive Advantage, I figured I’d explain how and why I ended up writing the book.

What you see behind me is my office.  This is where I “shoot” most of my blog entries, but I also shoot plenty of video from the field.  At conferences, clients, and even from my car.  Especially when the ideas are fresh in my mind and timely.  My entries are rarely polished, seldom rehearsed, and typically WYSIWYG.  Me. 

I try to keep my content to topics that impact what we’re trying to do, and, with this site, blog and the book, we’re trying to affect change.  We’re trying to help operations avoid having compliance issues drag them down in directions against their desired pursuits.  We do this through several aspects of lean and excellence. 

All things being equal, competing operations with similar market standings will end up fighting over a few percentage points in the noise.  We want to help operations stand apart from the crowd by operating at a level of performance their competition won’t try to reach.  One way to do this is to minimize, if not eliminate the burden of compliance on the operation.  It just so happens that what it takes to do this also has an immediate and long-lasting positive impact on the entire operation, compliance or otherwise.

I hope you join in the discussion and find value in your participation.