Reading the news has always provided a salutary reminder of how fast the world we value and take for granted can be transformed beyond recognition. Throughout history, even before newspapers, people have been all-too-aware of such vulnerability. But why are we all so ready to accept that things can, suddenly, be utterly transformed for the worse – and yet find it hard to believe that things can suddenly be transformed, unrecognisably, for the better?
This discrepancy is easily explained. For it doesn’t take an imaginative gift or creative leap to appreciate what you already have – what matters to you most – and imagine the myriad ways it might be taken away. However, to conceive of something specific and unexpected, new and desirable entering your life tomorrow and transforming it for the better takes a leap of imagination. By definition, you don’t yet know what it will be or from whence it might come. As the possibilities are infinite, the details of those that actually materialise invariably take us by surprise.
You already know and love the person whose passing would turn your life upside down; you haven’t yet met the child who will one day be born and change your life forever. You already know all the potential benefits and all the small-print of the business deal you are worried you might lose. But the even better deal ‘just around the corner’ that will seem to come out of nowhere, you can say nothing about until it comes knocking at your door.
With hindsight, sudden, pleasant surprises and improvements tend to occur more frequently in our life than the innumerable sudden disasters we spend so much time worrying about. “I am an old man,” quipped Mark Twain, “and have seen many troubles. Most of which never happened.” Like all God’s creatures, we are thankfully hardwired to focus more of our time and mental energy on spotting potential dangers and avoiding them, than on – impossibly – forecasting the particular strokes of good fortune that may come our way.
These considerations account not only for our near-universal tendency to worry unnecessarily, but also for the discrepancy in our conception – and perception – of the suddenness of across-the-board transformations. We find it easier to imagine across-the-board overnight disasters than across-the-board overnight improvements. It is true that what takes a generation to build can be destroyed in a morning. Yet sudden, across-the board, improvements are far more common occurrences in business than you might think at first.
My topic here is specifically a subset of these: the desired changes we deliberately set out to achieve in our businesses and how we need to think about them – perhaps the most widely misunderstood matter in the business and financial world.
Change is Quick and Easy
For contrary to popular belief, creating lasting, significant change in organisations, depending on how you go about it, can in every case be easy, effortless and take little or no time.
My own consistent experience over nearly four decades in the C-suite of leading corporations, as well as the experience of all my closest, longtime colleagues – a mix of accomplished, international corporate leaders and their advisers – is that designing an effective intervention to create a major transformation in organisations typically takes two people no more than about three to five hours – ready for immediate implementation, which should itself take virtually no time at all.
The ensuing change catalysed, which invariably takes place in an all-or-none flip virtually overnight and precisely as designed, will typically then be validated within a matter of a week or two at most; and after that it’s just ‘business as usual’. Not the old usual, of course, but the new usual – business from now on like it had never been previously. The desired change sticks – it’s permanent – and the marginal cost of the intervention usually turns out to have been close to zero.
Admittedly, our experience is unusual. The change methods we have collectively developed and deployed are unique and remain cutting-edge, decades ahead of anything else out there. However, the point is that our consistent experience over nearly forty years has demonstrated compellingly what is actually possible, and how very far removed this is from conventional management thinking circa 2022.
There can be no going back, for such consistent outcomes have to reset the benchmark for best practice globally from now on – prompting us all to radically recalibrate our expectations. Starting now, we can all get out from under the demoralising myth that change takes time, a myth operating destructively as a self-fulfilling prophecy. For if you assume change will take years, then it will.
Our findings apply equally to eliminating comparatively small but irritating short-term problems, and to resolving major, longstanding intractable corporate problems – a great many of which are valued in the billions or tens of billions of dollars. They also apply equally to designing an intervention enabling a company to reach new, ambitious – sometimes even impossible-seeming – targets in accelerated, often ‘impossible’ timeframes: four hours to design, immediate implementation, and transformation validated within a week or two.
And precisely the same timeframe holds for changing the corporate culture across the board, as I can tell you from first-hand experience as a veteran of some thousands of successful transformations; a significant proportion of which were aimed at changing the corporate culture of major corporations. Culture change takes hours, even days, sometimes even weeks; but it need never take months or years.
Scale, Scope and Difficulty are Irrelevant
Nor does it matter what the issue is, we have found; or how longstanding the problems are, or indeed how big the transformation is that might be required. Neither changes nor problems come in sizes; rather, they have lesser or greater consequences. Nor does the length of time a problem has persisted have any bearing on how long it will take to resolve it. Whether a clock has shown the wrong time for five minutes or five years, the remedy may be the same – say, plugging it in.
Moreover, a problem’s alleged ‘difficulty’ is only relative to what solutions have been tried. Our findings likewise demonstrate conclusively that there are in reality no ‘wicked’ problems in organisations of the kind alleged in a currently fashionable management myth (which inappropriately repurposed Horst Rittel’s and Melvin Webber’s otherwise useful term of art from forty years ago, relevant only to government policymaking). If you think your organisation has a ‘wicked’ problem, you are simply thinking about it wrong. You need to think again.
Of course, in a short report like the present article, I cannot begin to convey anything of the science behind this novel-change technology, let alone the highly technical analysis itself. Here I can at most alert you to this radical, but tried-and-tested, emerging new paradigm for change by way of encouraging you to raise your expectations. And here I can also try, at least, to make a little sense for you of why you would, after all, actually expect things to work this way. You may even start to notice when they do, and seize opportunities more often to effect lasting change more quickly and easily.
Sooner or later, however, we will all of us need to make sense of these game-changing observations, because they turn out after all to be the reality of things – however much the real-world results challenge conventional received opinion and widely-held, fallacious tacit assumptions.
Shifting our Tacit Assumptions
To achieve such results as these likewise requires a challenge to our tacit assumptions – not only our assumptions about the nature of change in general, but about the specific change you are attempting. Bear in mind, tacit assumptions don’t appear to be assumptions at all; they are not hidden assumptions; or rather, they are hidden in plain sight. They look and feel exactly like rock-solid, objective reality; part of the very furniture of the world – just how things are. And that’s where we all get taken-in by appearances.
Sir Francis Bacon, in his Novum Organum of 1620 – ‘the birth certificate of modern science’ – declared: “It would be an unsound fancy and self-contradictory to expect that things which have never yet been done can be done, except by means which have never yet been tried”. Developing and testing a reliable, rigorous technology for achieving such fast and effective change took our in-house investigators over half a century of dedicated scientific research and development, along with decades of parallel academic research we carried out at the University of Oxford, Brunel University (in what was formerly the Institute of Cybernetics) and elsewhere around the world.
We eventually succeeded in developing a unique, radically new proprietary technology for analysing any system to pinpoint – in advance of intervening in it -the smallest intervention into the system that would flip it from the existing state to the desired state and no other: all at once, with nothing in-between, and with absolute precision. But what we also discovered was that this first entailed a new and unfamiliar perspective on the familiar – nothing less than a revolution in epistemology.
Too often for decision-makers, reality is what their peers in other companies are doing and thinking. For Bacon, however, scientific discovery and technological advance require of us, above all, that we continually wrest ourselves away from conventional opinion, prejudices and unquestioned assumptions, devising experiments to accumulate diverse sets of observations, continually critiquing and revising our own conception of things as we go. “Nature can be commanded,” he said, “only by obeying her”: we need to do things nature’s way, and to do that we first need to learn exactly how she does things, and not how our peers already happen to do things.
Sixteen centuries ago, St. Augustine argued that miracles happen not in contradiction to nature but in contradiction to our understanding of nature. Every day, here in the B&FT, we read of new technological advances that only a few years ago would have seemed like miracles. To make such seeming miracles possible, what has changed is our understanding of nature, and with it our ability to tap its latent potential.
The Information Age?
The 20th century cybernetic revolution from which our radical new approach to change emerged substituted a new epistemology of form-and-pattern, information-and-communication for the old epistemology of substance-and-forces, cause-and-effect.
Computers were but one spin-off from the cybernetic revolution among many. Most of the pioneers of cybernetics, though they were largely polymaths, were not engineers or mathematicians by trade but medical men, psychiatrists and physiologists for the most part, their scientific work driven by a desire to promote human health and welfare.
One of the great ironies in the recent history of science is that a step-child of cybernetics, computer science, has in many respects turned back the clock. By making it all too easy for us to tolerate unnecessary complexity, leaving technology to handle it for us rather than keeping things simple in the first place, computing has arguably done more than anything else to derail the cybernetic revolution in ideas and postpone rather than hasten the advent of a true Information Age.
The Myth of Complexity
Information technology enables us to model and manage complexity, whereas cybernetics was all about filtering it out of account in the first place. Cybernetics viewed complexity as a fault of our maps, not a feature of the territory. Complexity, from this point of view, exists only in the eye of the beholder. As Einstein said, “If you understand something it is simple”. Here is an example:
For many years, a large European industrial operation had been faced with a supposedly complex and increasingly expensive problem. Every year, a group of technicians and their managers arranged their annual leave. They were each entitled to five weeks’ holiday per year, of which three weeks could be taken in succession. Everyone wanted to take their three weeks’ consecutive leave during the five-week school holiday period. However, it was required by law that there be at all times a minimum of 50% engineering coverage of the plant at this level of technical responsibility. Non-compliance courted exemplary government fines in the tens of millions of euros or more. Each manager was responsible for about 40 of these engineers. And every year, each manager was involved in scores of hours of expensive management time negotiating and arranging annual leave.
Across the board, hundreds and hundreds of man-hours were wasted this way every year – and it always went wrong. Complaints to the workers’ council over broken leave agreements were numerous, and not infrequently led to bitter industrial relations crises. And it often transpired, particularly during the summer, that there was well under 50% coverage on a considerable number of days – leaving the company exposed to potentially grave risk. Last-minute changes in holiday plans of course caused total havoc.
To solve the annual leave problem, the top management consultancy companies, one after another, brought their complex and expensive, high-tech digital solutions which were all tried. All failed.
After years of attempted technological solutions and complex, time-consuming workarounds, the eventual solution – simplicity itself and obvious with hindsight – took just a couple hours of inquiry to devise, and it resolved the problem instantly and permanently. It took each manager no more than 20 minutes in total to implement and has delivered perfect results each year ever since, with complete flexibility for the engineers to change holiday arrangements around whenever they wanted to alter their leave dates. And there was always a minimum of 50% coverage, without a single exception. And no digital assistance was needed at all.
The most inflexible constraint was ensuring 50% coverage of the plant, while permitting free choice in booking vacation days. But what does ‘50% coverage’ even mean? How would a seven-year-old draw a picture of 50% coverage? Well, maybe there would be stick figures on the beach in hardhats playing with a beachball; and there would be a crayon line from each figure on the beach to another stick-figure back on duty at the plant. The situation was, in other words: how do we ensure that every technician on holiday is matched by someone who is covering back at the plant?
For anyone but a computer, this was now a no-brainer to solve, as the only action required was to ask all the engineers to choose a partner and pair up, telling them:
“Book your leave days for whenever you like, so long as your partner covers for you; and change it around later and as often as you like, subject only to the same proviso. Oh and by the way, you’ll probably want to pick as a partner someone you can be sure you will never want to go on vacation with, and whom you wouldn’t miss if they were out of your hair for at least 10 weeks a year!”
This example may seem simple – but remember, a lot of smart people had spent untold millions of dollars on management consultants and on a series of failed high-tech solutions, including AI, before it was finally solved without them. Like every epiphany, it may have been obvious afterward… but it eluded the best minds for years. And in our experience, even the most complex, intractable problems can be solved with equally simple-sounding solutions; and even the most dramatic and game-changing corporate transformations can invariably be achieved with equally simple interventions.
The Digitisation Conundrum
This is not to disparage digital solutions as such. Even if overhyped and still at a very early stage of development, the future potential of artificial intelligence, including the promise of machine learning, is very real and an inescapable part of our collective future, as is IoT, particularly with the rise of industrial Internet.
However, the misuse and overuse of AI, and of digitisation more generally – which I have critiqued at length elsewhere – is concerning and destructive. Not least our insatiable appetite for complex, high-tech solutions to low-tech, fundamentally simple, ‘high-touch’ problems as in the annual leave case above. The availability of artificial intelligence is neither an invitation to forego the exercise of natural intelligence nor an excuse for doing so. In the race to secure our place in the future, we are quite naturally loath to be left behind. But in running to catch the latest bandwagon, we can easily trip ourselves up and fall out of the running altogether.
Too often these massive, only half-understood investments, while sometimes helping to fuel business growth, become ‘toys for boys’, only to be discarded on Boxing Day; or, far worse, are persisted with to justify the investment long after they have proved counterproductive, in order to protect the hapless executives who had signed-off on the spend. In the article I cited above, I described just such a case – a prohibitively costly, centralized, countrywide, ‘Big Data’ AI system that top management were convinced, without real evidence, could anticipate supermarket demand better than local store managers.
Ever since the system’s launch, local store staff could only look on helplessly as unsold goods went stale on the shelves, and customers were driven away to competitors as their favourites were always out of stock. The desperate pleas of the store manager were dismissed by HQ with, “You can’t expect to argue with the computer! Can you match that much hard data?”
As the inventor and computer scientist Danny Hillis put it, “Technology is all the stuff that doesn’t work yet”.
Here is another, particularly horrifying, example: On 14th February 2022, BBC and the UK’s national papers reported on what the BBC said may be ‘the most widespread miscarriage of justice in UK history’. The gist of the story is that the UK Post Office between 2000 and 2014 prosecuted 736 branch managers – an average of one a week – because senior management trusted the information spewed out by a recently installed computer system. The faulty software made it look as though Post Office money was missing from their branches, resulting in over 700 criminal convictions for theft and false accounting.
Many hardworking, honest people were financially ruined – along with the lives of countless families, shunned by their communities following the conviction. Only now, after 20 years of campaigning, during which time some of the wrongfully convicted have since died, campaigners have at last succeeded in having the cases reopened. For two decades, the Post Office and the courts took the word of a machine over the word of 736 intelligent human beings – long-serving, honest, loyal Post Office personnel, each of whom had always protested their innocence.
Before the advent of artificial intelligence we did not have artificial stupidity. Before machine learning, we had no machines with learning difficulties. As with badly-behaved dogs, though, we must look rather to their owners. No one can shirk responsibility for decisions by effectively delegating them to a computer. If the 2008 financial crash taught us anything, it is this.
The question is not whether to digitise, but precisely when and where and how, to what extent, and in what way. As the father of the modern dictionary Dr. Johnson remarked 250 years ago: “A cow is a very good animal in the field; but we turn her out of a garden”. Too often, our prize gardens are overrun by the cows of digitisation. My once favourite English country inn, overwhelmingly popular in the summer because of its magnificent pub garden, in its greed for expansion paved over the garden to enlarge its car park. Unsurprisingly, it was out of business within a year.
Consider the fact that some US$4.5trillion worth of IT solutions will be sold in 2022, and hundreds of billions of dollars or more will be spent promoting these technological wonders. You can be sure a lot less will be spent on questioning whether there may not be a better, low-tech way just here, whether the intelligence required here is after all the natural variety, or whether Big Data is a big mistake.
If we are to use artificial intelligence intelligently, just as much thought and design must go into deciding which functions we will deliberately leave to the natural intelligence of real people. As with the supermarket case, it is in part a question of where the control should ultimately lie. It’s one thing to use AI, quite another thing for it to use you.
The Flight into Abstraction
Instead of painstakingly arriving at simpler, more effective solutions in the first place, solutions which are often far quicker, far cheaper and far more effective, we sloppily and complacently create unnecessary complexity because we know we can leave technology to manage it for us. We tend to turn to digital solutions just because we can.
But just because you can do something doesn’t mean you should. An old NATO training manual advises that just because it is humanly possible to push a pea up the side of a mountain with your nose does not mean that this is the most effective way of getting it there, or that the exercise is worth undertaking in the first place in pursuit of your greater objective.
As in the case of the empty supermarket, the now endemic, destructive disparagement of local knowledge is in danger of becoming ever more entrenched. This is due not least to the accelerating speed of technological advance increasingly outstripping our understanding of how best to deploy it – most notably in AI.
Tapping local knowledge is key to successful business, as we all know. But our own research has revealed that it’s also key to fast and effective change. This goes far beyond the question of natural intelligence versus artificial intelligence.
Computers like numbers they can crunch; it’s basically all they do. So we try and feed them numbers. In recent years, there has accordingly been a craze for quantification.
Measurement is important, indeed vital. However, we habitually tend to measure not what it is important or relevant to measure, but what is easy and convenient to measure, or what we already know how to measure, or what we are used to measuring, or what someone upstairs told us to measure. It’s pretty arbitrary and one-size-fits-all. But be careful what you measure, because by and large you’ll get what you measure.
The fetish for quantification however, is in turn only part of a still wider, rapidly accelerating vogue for ever-more abstract, convoluted systems; whether analytical or bureaucratic or both. Seven decades ago, in The Human Use of Human Beings, Norbert Wiener – a pioneering cybernetician – prophetically warned of the dangers from groups of people extending their control over others, not only “by means…of machines themselves but through… techniques as narrow and indifferent to human possibility; as if they had, in fact, been conceived mechanically”. In trying to fit in with the machines that we have made in our own image, we end up remaking ourselves in the machine’s image – reducing ourselves too often to unthinking automata.
Indeed, over the course of my career, the single most dramatic and consistent change I’ve seen in business has been the ever-increasing abstraction of senior management – the flight from the personal, living, real and concrete, simple and down-to-earth, to the impersonal, remote and abstract, lifeless, convoluted and arcane.
The Lost Art of Management
The most influential business and management book of the ‘80s and ‘90s, the 4.5m-copy bestseller In Search of Excellence by Peters and Waterman, popularised the practice of ‘MBWA’ or ‘Managing by Wandering Around’, thus demonstrating its power. When the book was published in 1982, spreadsheets were not yet something all managers viewed and tinkered with on a computer; they were still, literally, just large pieces of paper, filled-in with a pencil and rubber, used by denizens of the accounting department, unseen.
As late as the turn of the millennium, instead of tying themselves up in endless formal meetings and duelling emails while staring at computer screens fancying they were divining the state-of-play of the company, the best CEOs and senior managers would routinely work informally, face-to-face with their direct reports; and spend much of their time wandering freely around their organisation, interacting spontaneously with employees at all levels. Often, they intervened ‘informally’ but deliberately as they made their rounds.
In our own change work, CEOs will also learn to do so by meticulous design; for instance when a CEO changed previously sloppy maintenance at the company’s plants overnight:
On his next visit to a major plant, as he made the rounds chatting to the engineers, the CEO spotted a machine leaking oil, leaving a small puddle on the dirty concrete floor. Dressed to the nines as always in his monogrammed shirt, French cuffs and madder silk ties, the CEO – who had originally trained as an engineer himself and had risen through the ranks – casually asked for an adjustable spanner. And as he continued chatting, he got down on one knee in his pinstriped, flannel Savile Row suit and tightened the offending nut without comment, carrying on chatting amicably about various issues as if nothing were amiss. The story spread like wildfire through the company’s facilities, far and wide. It was the last unattended leak he or anyone would have to see.
The Myth that Big Problems Call for Big Solutions
As in the annual leave case, the ‘cultural’ maintenance issue had been a major, intractable and costly problem leading to production line downtime – but the solution, the change intervention, was tiny, fast, and transformative – and again, the change stuck. In a world of substance-and-forces, cause-and-effect, the world of the old epistemology, big change requires a big intervention. But in a world of the new epistemology of form and pattern, information and communication – which is the world I firmly believe we actually live in – a tiny intervention, carefully pinpointed, will invariably suffice if we can find it. For example:
Major litigation by all 50 U.S. states was underway over sales practice violations by a huge, successful financial institution that had already admitted the error of its ways and paid several billion dollars in damages. As part of its rehabilitation, it was required by the federal government to undertake a major overhaul of its management systems and practices to convince the regulators in all 50 states that they had repaired their sales practices and had mechanisms in place which would prevent such abuses from being repeated. After spending untold millions of dollars on major training programmes and having computerised sales-management systems installed by the big management consultancy companies over a few years, the large-scale mis-selling continued unabated and the regulators were growing increasingly impatient.
Finally, one morning, a company executive brought us the problem to work on with him one-on-one. The solution we devised by lunchtime didn’t cost a cent, required only a few phone calls that afternoon and one conversation in person a couple of days later – and it was fully up and running within a week, immediately resolving the entire issue. The states of New York and California swiftly reviewed and blessed the new protocols, with the remaining 48 states quickly rallying as further signatories. In the quarter-century since the time of intervention, any infractions have been so trivial that they have not attracted a single complaint from any state regulator; and following our client’s bellwether example, the blindingly simple new protocol – requiring no systems and no training at all – was made standard industry practice nationwide.
In another case, the board had just approved a 5-to-7-year contract with a leading management consulting company, with estimated fees in excess of a billion dollars including an annual retainer of fifty million dollars. It was to transform a corporation’s culture and operations around risk, where shortcomings had been costing the company billions of dollars a year. We were purposefully told none of this when the CEO – just before embarking on what was sure to be a disruptive, time-consuming exercise – asked us to design an intervention to create the change: which we did in one afternoon, and it was implemented the following day. It worked. Less than three weeks later, the CEO cancelled the big consulting contract before it started – on the grounds that the transformation had already been achieved, the problems solved, and that there was nothing more remaining to be done.
When you look back on your own hard-won successes in your personal life or in your career, you can often identify, with the benefit of hindsight, one key thing you did – one lunch, phone call, or tiny shift in how you did or looked at something – and if you’d only done that one small thing at the start, you’d have been spared 90% of your struggle and got there much sooner. But what if you could reliably pinpoint such catalytic actions in advance, in any situation? That is precisely what our unique new approach makes possible. And once you know such things are possible, in the blink of an eye that changes everything.
The writer, is an Oxford philosopher and scientist who has spent his entire career researching change.