Musicians Make Music—Not Organizations

Article two in a three-part series

Introduction

My last article left us on a cliff hanger. We discussed the best way to get a marching band to play harmonious music? If you haven't read the first article in this series, go back and check it out. The first article: "What We Usually Focus on and Shouldn’t" highlights why focusing on infrastructure doesn't work. Those functions can support band members, but they don’t produce the music. So, where should we focus our coordination efforts?

What Is Value Creation?

Organizations have layers of bureaucracy and infrastructure. Yet, beneath the bureaucracy exists the final layer where employees create customer value. It happens when...

• An employee helps a single mom who has lost her job find work
• When a correctional officer engages with an inmate
• When we issue the business permit to the entrepreneur
• When the the medical examiner is able to explain to a family what happened to their loved one
• When a state trooper pulls a driver off the road who is under the infleunce of alcohol
• When an engineer completes a complex design
• And in hundreds of other interactions that occur across government every single day.
• In the private sector, it occurs when we produce and deliver a product or service

I call the nexus between mission and value creation operations. This is a sterile term for such powerful work. Here is the key—coordination should happen where we create value. Everything else that goes on in the organization should exist to support this one activity. The organization's center of gravity should be where employees create customer value. Once we know where the center of gravity is, we know where to begin focusing our coordination efforts.

Some of you may be thinking, "Yes, we already know all this. We are coordinating all the scaffolding services to help the customer...duh!" There is no doubt that people's intentions are good when they focus on coordinating scaffolding services. Yet, it is a pretty circuitous route to go through all the infrastructure to get to the real gem.

Imagine you are standing at the opening to a diamond mine. Now, you could walk in and grab the diamonds, or hike to the top of the mountain to start drilling from there. After drilling through layers of hard earth, we may be too exhausted to complete the job. Or, we may forget about the diamonds entirely. When we start down this path, its easy to lose our way and forget what the real prize is.

Let's go back to our marching band. The audience wants to hear harmonious music and watch a synchronized performance—it’s where value exists. So, if we want to know where to focus our coordination efforts, it should be helping each individual band member know what note to play and when. Music begins when the drummer, trombone player, and trumpet player all read the same sheet music.

Band members can either spend time practicing their music, or adjusting to new administrative policies, shifts in the organizational design, or new protocals for filling out reimbursement forms. Focusing on the scaffolding services takes time and effort away from those on the frontline who are creating the value. Unfortunately, this cost is often hidden and far enough downstream that management may not see it at all.

A Real Life Example

Let me share an example from my own career. When I took over the helm of a large agency, there was an effort underway to "coordinate" programs. The agency purchased expensive technology (nearly $80 million dollars worth), reorganized two divisions, and "cost allocated" programs. After all this, there was no measurable improvement to the time or quality it took to do the job. We changed direction and began focusing on the point where employees create value. We focused on how the frontline teams did their work and what they needed to be successful. Then, and only then, did we see the huge improvements we all wanted. We achieved close to a 40 percent reduction in costs, and a big leap in quality. All this happened while the demand for services skyrocketed by nearly 50 percent. We returned approximately $20 million back to the state. We also reduced approximately another $10 million in other funding sources.

Where Should Your Organization Focus Its Coordination Efforts?

If you're not sure where the point of value creation exists in your organization, the following questions may help you discover it:

• What specific service, decision, or product does the customer expect to receive?
• What did the customer come to buy?
• Why does the system or organization exist in the first place?
• Which individuals are directly involved in creating value for the customer?

The answers to these questions will determine where your organization creates customer value. Sometimes, we get it all backwards. Let's first fix how and where we make music. Then, we can assess where, when, and how the infrastructure can best support the musicians. The infrastructure should subordinate to the point of value creation--not the other way around.

And once we know where to focus, it’s time to figure out how to synchronize the individual musicians. The strategies are simple but not always easy. Next week, I will focus on the specific strategies in the third and final article in this short series.