I’m fed up with organizational dysfunctionality

Some say Agile doesn’t work. I say it’s dysfunctional organizations that don’t work.?

For example, the best ideas in the world are unlikely to save the UK’s National Health Service because the organization is so dysfunctional. Perhaps you can think of another example more local to you. Sadly, that’s likely not hard to do. Large, dysfunctional organizations abound. Sometimes things are so bad you’d think that whatever remedies we throw at the situation, matters should improve. But it can always get worse. So, should we all give up and go home? Not quite yet. Let's look at a common area of dysfunction— optimizing for resource efficiency under the guise of system efficiency — and its possible remedy.

Efficiency tunnel vision

There is a difference between resource efficiency and flow efficiency, as described in this TedX talk by Niklas Modig. As the joke goes, “You call me a resource; I call you an overhead.” Henrik Kniberg has a wonderful video on the “resource utilization trap.”

If your idea of efficiency is keeping everyone busy, that’s a first-class ticket to negative chaos. Sufficient slack time allows us to help each other out and rest our minds.?

Too much of anything is a problem, even (dare I say it) focus. It makes sense to squeeze as much juice out of attaining product-market fit as sustainably and humanely possible once we achieve it. Focus on improving capability and speed can deliver more value.?

But we need balance.

We need the slack time to think, invent, and innovate to uncover the next billion-dollar idea with product-market fit. All too often, we’re as gluttonous as pigs at the trough without giving one thought to the future revenues of the organization—the long game. Think of what happened at Nokia or Blackberry. Short-term greed seems to win out most of the time over long-term good. It happens again and again.

Organizational success comes from understanding how the system functions as a whole toward achieving the end result. We can’t optimize individual parts of the system and expect them to come together to achieve our desired end. As Dr. Russell Ackoff brilliantly explains in this Systems Thinking speech, systems don't work that way.?

The sad thing is that while dysfunctional organizations can muddle on and seem to work, focusing on flow would improve matters significantly.?

But even flow can be abused.? Take, for example, a patient whose UK general practice (GP) physician has a clinic that forces people to call at 8:00 am or 1:30 pm for an appointment or consult to control the arrival rate of new cases. Flow folks like to control the arrival of new work into the system, but have things gone too far from a health system perspective? It's as though they hope people will give up and go to a private clinic or the accident and emergency dept. (A&E), or escalate to the point of calling an ambulance.?

Imagine the patient had to go to A&E by ambulance eventually. Imagine that the patient subsequently received a referral to a specialist clinic within the same hospital, due within one week.

Now, let’s look at the specialist clinic in this scenario. It doesn’t answer phone calls or offer any form of digital contact should the patient need to escalate a referral from a GP due to a worsening condition. To expedite care, the patient could go to an available neighboring county hospital, but it will only take over their care if the assigned medical practice switches the referral. In this case, the patient needs to convince the medical practice’s clinic receptionist (at 8 a.m. or 1:30 p.m.) to allow a conversation with the GP to request a referral switch. (You can see how one might be tempted to exaggerate one’s condition in this scenario.)??

The patient’s only alternative outside the designated call-in hours was contacting a remote call center, promising a 72-hour response time. I can always tell when an organization has developed a hate for its customers/patients; it outsources “annoying” contact to a call center that does not have all the information and skills it needs to function well. Patients have to repeatedly call the call center in a vain attempt to get proper service. It turns out, in this case, the original referral for the patient from the accident & emergency department never got to the specialist department in the same hospital. After 72 hours, the call center admitted it was overwhelmed; I’m guessing because of poor management and escalations. Also, the GP had not even noticed the referral until asked about it. As a patient, it would be a mistake to trust this system.?

Many features of the UK’s National Health Service defy reason. When visiting a GP in the UK, for example, you’re only allowed to talk about one issue; other issues require separate appointments, even if there is a systemic interplay between the person’s health complaints. Russell Ackoff would have been horrified. The UK’s National Health Service is a dysfunctional mess illustrated by the fact that an infusion of cash has not helped it to cope with the Covid aftermath.?

I suspect that Tom Gilb is onto something with the lack of clarity of objectives in many organizations and lack of appreciation for the contradiction between goals or % spend for each goal. I suspect the UK’s NHS is no exception. It is possible to quantify what at first seems unquantifiable, thereby enabling regular measurement against goals.

To “improve” or “manage” resource flow, the UK’s health services system has evolved to alienate and frustrate the people it serves—those already in a vulnerable state and needing medical care. In contrast, the alternative hospital in a neighboring county offered an appointment to the patient within two weeks after a five-minute email wait. The alternative hospital in a neighboring county is likely well-managed; it has a good flow of patients who trust this healthy “culture bubble” within the messed up NHS system.

The mess

From a flow perspective, the biggest error is an excessive focus on resource efficiency. In the face of an entrenched and costly bottleneck, TameFlow is worth a look. Planning more capacity in areas not affected by the bottleneck that the bottlenecked areas won’t be able to deal with to keep everyone busy is a disaster for the flow of value.

I witnessed flow so bad in one organization that it would take years to finish the work in progress (work that is started and unfinished). I urged the organization to question and cancel work in progress where possible to turn off the tap on incoming tasks; there was zero appetite for that. Further, inspection revealed there were several incoming taps of work. This happens when you leave the control of delivery up to “project manager 2.0” people (labeled as BS “product owners”) or (relabelled) traditional management people.?

Let me say I was a project manager and supervisory manager a long time ago. There are excellent project managers who are much better than the fake Scrum Masters or agility coaches I observe. Sadly, though, most project managers optimize for an increase in the budget and staff numbers as that’s what they advertise on LinkedIn as a signal of how good they are, along with the fake value delivered, which they often never actually evaluate. Project managers don’t usually notice the demand they create from not addressing customer needs in the first place, called failure demand, because of their (generally) short- to medium-term focus.?

One will need additional money to finish work in progress if there is too much of it unless one cancels some of it. When those in charge feel unable to ask stakeholders to increase the budget for a product they believe they have already paid for—when they choose to be opaque over transparent—the taps stay open. It’s a “game set and match” for negative chaos. People metaphorically fall on top of each other, block each other, and are unavailable to help each other. In situations like this, you often need to get the best 30-50 people to go into isolation to sort everything out one step at a time. It takes courage to course correct. Most people go for an easy life, with an apathetic view that the system is messed up anyhow.

A Remedy?

As discussed in my InfoQ article, why you might need an island of agility in the kind of situations I just described, consider:

• An isolation pattern from Heidi Helfand
• A culture bubble from Audrey Tara Sahota and Michael Sahota
• A parallel organization from LeSS
• An island or archipelago of agility

To enable an agility island, you often need to set up a brand-new organization, immune to the existing bureaucracy and supplier ecosystem complexity. I don't hold much hope if you already outsourced the “crown jewels” (the value-generating part of your organization). Many people don’t get that when you optimize for reduced costs, long-term costs actually go up. Check out John Seddon on YouTube for more on this equation.?

Even though the island of agility approach is a new take on the concepts of culture bubbles, isolation patterns, and parallel organizations, many have told me about a similar idea in years gone by and that it worked for them. It turns out that creating an island of agility is a new-old idea, deriving value from its contemporary restructuring.

What Elon is doing

Elon used to sleep at the bottleneck in Tesla. If he did that because of bottleneck awareness, kudos to him. If he did it because he wanted to keep the bottleneck busy, kudos to him. If he did it because he wanted to keep everyone busy (I think not), I’d be disappointed from a flow perspective.

Twitter was losing lots of money, and bureaucracy had set in, slowing everyone down, although hopefully not as bad as the UK’s NHS. Twitter is an interesting case study in organizational change. I am curious to know if Elon has managed to change the organization in his mere weeks there. Changing a large organization is almost impossible. Elon went for the nuclear option, and people were collateral damage.

Not all parts of an organization need to be extremely agile. The agility island approach is more humane because rather than dismantling everything,? it leaves the mainland focused on what it does best while still expecting it to evolve as quickly as possible to deliver agility in a sustainable, authentic, and humane way.? By dismantling Twitter, the organization lost credibility with the EU and U.S. authorities regarding the former Twitter's compliance with data protection and privacy laws.?

But to be fair to Elon, he didn’t waste time nudging people towards change who didn’t want it. I like David Marquet’s recent leadership nudge on people who block change (I like all of them:)). Executives are usually the slowest to change but need to be the fastest to avoid enthusiastic people becoming apathetic. What happened recently at Twitter was brutal, but people opted in. Yes, some “decisions” might have been in favor of extending work visas, but everyone remaining is motivated to be there. And unlike an agility island, there is no risk of the mainland taking back ownership because there is no mainland. But there is still a risk of takeover from elsewhere.

Regardless of the organizational situation,? we should always remember people. I would have preferred Elon to use an agile/archipelago adoption approach. It could have accomplished the same things.

The paradox

Who needs to decide on creating an island/archipelago of agility? The current board and executive management team are at the trough of short-term greed. It takes brave leadership that sees the long-term benefits and balance the short-term with the long-term.

Alignment is not required; revolutions don’t wait for everyone to get on board (Leandro Herrero). Create a new organization and be careful about who gets in.

Cooperation is when people work together. Competition is when people work against each other. “Coopertition” is a made-up word for when competitors work together for the collective good. Even if the island of agility gets off the ground, it will compete against the mainland, hopefully using cooperation, or “coopertition” as many successful firms do together in Japan. The West isn't so good at “coopertition.”

Is there hope?

There is always hope, which is why I’ve collaborated with others to bring a wealth of resources to facilitate genuine organizational agility.?

Kanplexity supports project managers as well as product managers.?

The Xagility YouTube channel offers free 1-3 minute videos for executive management and board members.?

With others, I plan to shine a brighter light with The Xagility podcast and Xagility eLearning in 2023, and much of that content will be free. Xagility goes beyond helping executive management and board members understand what might help (the context being king and all that); it also focuses on helping them change habits of a lifetime.

The Xagility engagement model is agile about becoming agile.? You can’t buy agility in a box, and agility isn’t necessarily Agile.

Just like executives and board members need to change habits of a lifetime. I need to change personally. I need to change the habits of my lifetime and overcome them by losing weight and getting fit. I’m back in the gym, and it feels good. So maybe there is hope for us all.