Thursday, March 7, 2013
Crises are a fact of life in any organization and test the skills of even the most effective leaders. Each one is unique and requires carefully thought out methods for resolution. There are several factors that must be balanced in resolving a crisis. First, of course is urgency. By definition a crisis is an undesirable situation that is disrupting normal operations and is likely costing money or the organization’s reputation. In a crisis the leader’s objectives are:
· to restore normal operation as fast as possible,
· at the least cost,
· with a high probability that the system is changed so that the crisis can not recur,
· with assurance that any changes to the system do not encumber the organization or work processes in ways that reduce overall effectiveness
· and that the rationale for changes is documented.
Problem solving tools are discussed in later lectures. Here I just want to emphasize two constraints in effective crisis resolution. First, it is very important to not just resolve the crisis but to understand why it happened, what deficiency in the system enabled the crisis to occur, to change the system so that the same crisis cannot reoccur again and to document the rationale for decisions relating to any changes in the system, or rules or policies. The crisis manager’s job isn’t done until all of this has been accomplished. There is always pressure to return to normal operations as fast and cheaply as possible and this pressure can inhibit getting to the root cause of crises, changing the system so that they don’t reoccur and properly documenting the rationale for the changes. If the crisis manager succumbs to this pressure the crisis will likely reoccur and blame will be assigned to those that didn’t fix it right the first time.
The second constraint is to ensure that system changes are effective; that is they are not cosmetic and they do not unnecessarily encumber work processes. Old organizations are often filled with rules and policies that were put in place to solve long ago crises. Too often such rules and polices do not reflect changes to the system that prevent the crisis from reoccurring but rather try to constrain workers so that they don’t allow or cause the crisis to reoccur. Often the crises continue and more rules and policies are instituted until the organization is so bogged down it becomes non competitive. If tempted to add rules or change policies to prevent a crisis from reoccurring take the time to question whether the system is being changed effectively by such rules and policy changes. Ask whether the proposed changes are changes to the system or the result of blaming people for the crisis. Recall the 85/15 rule discussed earlier. If people are being blamed for the crisis 85% of the time the managers are wrong and proposed changes are more likely to encumber the system than to prevent reoccurrence of the crisis.
The effective leader is always on the lookout for old rules and policies that inhibit productivity and may no longer be necessary due to changes in work processes or products. If the rationale for the old rules or policies was properly documented knowing when they can be changed is usually evident. Caution is required if there is no documentation to ensure that changes in work processes or products have really eliminated the need for the old rules or policies. New data may be needed. If so, the issue becomes a process improvement activity, which is covered in more detail later.
Your crisis resolution plan must be based on in depth analysis of the causes of the crisis and in depth discussions with the people closest to the problems. Jumping to popular solutions rather than carefully thought out plans usually results in a continuing crisis. Failure to have an effective plan and effective communications invites others to give you help, which typically just makes the problems worse, and always increases your workload. You must maintain the confidence of stakeholders, particularly your superiors; otherwise expect to be removed from leadership of the crisis. At the same time you must fend off uninformed advice, which is abundant in a crisis. More will be discussed on crisis management in the next lecture on meetings.
Defining proper information systems is beyond the scope of this course but it is necessary for the effective leader to know how to identify the symptoms of poor information systems or improper use of good information systems. One tip off of poor information systems is people saying meetings are necessary to gather information. If you hear this reasoning for meetings not related to a crisis or a new project then you should examine the information systems. It takes much less time for workers to record key job data in some type of data base for a manager’s review than it does to have to meet with the manager and provide the data verbally or, even worse, on PowerPoint charts. If you find workers are not entering necessary data properly than training is required. If workers are entering data properly then either the processing of the data in the data base is ineffective or the manager using the data doesn’t have the training to properly use the data.
A second tip off of poor information systems is workers or administrators having to chase down needed information. Information should flow up and with today’s computer networks this can be make to happen nearly automatically if the right data is being entered at the right time by the right people.
Finally, be on the look out for information that isn’t actionable. This is information that is no longer needed or just doesn’t apply well to current work processes. This can result from commercial or homegrown information systems that are improperly tailored to your organization or enterprise. If you see information that isn’t useful to you or anyone else then question whether it is worth having workers collect and enter the data.
Poor information systems are costly if highly paid workers are required to process data that could be processed by lower cost administrators. This topic is explored further in Lecture 22.
When projects or special tasks fall behind schedule there is often pressure to add additional people in order to get back on schedule or at least not fall further behind schedule. Of course there are times when this is the right management action. However, there are times when process problems are causing the delays and adding more staff isn’t the right answer. If process problems are the cause then usually fixing the process is preferred to adding additional people. The difficulty is that it takes time and knowledge to identify when process problems are the root cause of delays and there is typically pressure for immediate management actions such as adding staff.
The theory of constraints, often used in manufacturing and service organizations, also applies to projects and special tasks but its effects are not as easy to identify. Failure to understand constraints can lead to the wrong management action and overstaffing is a typical wrong action. Project management techniques use critical path analysis to identify constraints to schedule but projects are dynamic and critical paths change or new critical paths emerge. The project manager and the supporting managers must not only identify and track the critical paths as they evolve, they must also understand the reasons the work is schedule constrained and the nature of the work that is on the critical path.
In some cases the critical path work is easily divided among additional workers and schedule can be reduced by adding staff to the tasks on the critical path. Other times the work is dependent on special skills or requires extensive review to understand before a new person can contribute effectively. In such times adding additional staff actually delays work on the critical path because the existing staff must bring new people up to speed and because of communication induced delays introduced by the additional people.
In an ideal situation doubling the number of people on a task cuts the time to complete the task in half, that is, ideally, the schedule is inversely proportional to the number of people assigned to the job. However tasks are typically complex and can only be divided into a limited number of pieces that can be worked independently. On complex tasks there is a need for work results to be communicated to other workers, as well as to managers. The more workers assigned to the task the bigger this communication need and the time spent communicating grows geometrically with the number of people. At some point workers are spending more time communicating results and status to each other and to layers of management than they are actually generating direct work products. The result of these relationships is that there is an optimum number of workers for a task in order to achieve minimum schedule and adding workers beyond the optimum actually delays the time to completion.
How does the effective manager avoid over staffing? The details of project management are beyond the scope of this course but we can touch on some highlights. First of all, when a project or special task falls behind it must be treated as a crisis and the effective manager takes charge or ensures that the right kind of manager is in place. A project or task in crisis is no time to have a manager that leans toward affiliative management. A czar is called for until things are under control. (Don’t forget to change your behavior if you are the czar, or remove the czar, when the project stabilizes because czars are best at “stop the bleeding” situations and are not the most effective managers in non crisis situations.) Second, remember that in a crisis it is doubly important to manage both up and down. Down requires that you get involved sufficiently to really understand what is going on in detail, otherwise mistakes will happen, e.g. as discussed above. Managing up means having a detailed plan to resolve the crisis and communicating the plan and progress on the plan to all stakeholders more frequently than normal. These communications must be honest and timely but you must understand problems before they are communicated upward. The trick is balancing your understanding and the timeliness of your communications.
Please remember that project management is one of the most complex management jobs. The steps listed here are necessary but by no means sufficient. You should study books on project management if that is on your career path. And a final reminder, under staffing, although not a time waster, is a serious detriment to effective organizational performance if left uncorrected for more than a couple of months.
I will digress here to share a story from my early management experience that may be helpful to those new to project management. If project management isn't on your career path feel free to skip ahead to the subheading “Useful Hint”.
As a young department manager in an engineering organization I was given management responsibility for an important product development project that had been in crisis for several years due to technical problems, resulting in large loses of company money, unhappy customers and the firing of the two previous project leaders. Many people in the company believed they had the solution for the technical problems and were more than free with their uninformed advice.
Fortunately, I was saved by the previous manager’s hiring of a new engineer just before the manager was fired. During the short grace period I had before results were expected I learned that this new engineer understood the technical problems in depth and had developed an effective plan to resolve them. Unfortunately, it was going to take at least four months and considerable investment to solve these problems. The new engineer had neither the respect of management (because he was new and untested) nor the communication skills needed to sell his plan. I recognized that continued failure would lead to my firing so I had little to lose. I went to the company president with a simple plan. Give us six months, the money we needed and keep all management off our backs during this time. I promised we would achieve the desired product performance within that time or he could fire us both (which would have happened anyway).
The plan, which was really no additional risk to me, gave us the freedom to work in peace for six months. The technical problems were solved as promised, the product performance exceeded requirements, the new engineer got the credit he deserved and the product went into a long and profitable production run. The lesson is simple. Successful crisis resolution requires in depth understanding of the causes, sound plans and no shoot from the hip management actions.
Increasing the effectiveness of your organization must include changes in processes as well as changes in people. Data is required to change processes effectively. The reasons are discussed more fully in a later lecture so for now accept this requirement. A simple and convenient way to gather data relevant to time management is via time logs used as appropriate by everyone in your organization. I don’t recommend time logs be used all the time but if you suspect some process is wasting time or if you are concerned that your people are spending too much time on some relatively unimportant task ask them to keep time logs for four to six weeks. The objective is to find information that is not on formal time reporting systems. This includes time lost in amounts too small to record on formal time reporting systems. Two examples are time lost due to unreliable equipment or time spent correcting poor work done by another person.
When you suspect such time wasters in your organization pick one to three of the suspect items and ask your staff to jot down on paper or electronically each day how many minutes are spent on each suspect time waster. In a few weeks you should have enough data to make effective decisions. The lost of ten minutes per day by each person in a 40 person organization over 250 work days amounts to 100,000 minutes or almost a full person year; well worth correcting. Such data is useful for making decisions for your organization and for convincing your peers and your superiors action is needed on topics important to your organization but not under your control.
A couple of examples better explain the use of time logs. Suppose you think your staff is spending an inordinate amount of time doing remedial work on defective paperwork submitted to them from another organization and the manager of the other organization doesn't respond to your concerns about the quality of his or her organization’s work. Presenting the other manager with hard data on time lost in your organization fixing mistakes made by his or her organization makes your argument more effective because such data can’t easily be dismissed and reflects poorly on the manager’s performance if not addressed.
Suppose your workers are complaining that a copy machine is unreliable and is wasting their time. You report it but the unreliable machine is neither repaired nor replaced. Ask your workers to keep a temporary log of the time they waste coping with the unreliable machine. You can use this data to calculate the excess cost of the unreliable machine and then use the cost data to make a stronger case for having the copy machine repaired or replaced.
1. Think through a crisis you have recently handled or observed and answer the following questions:
· Was the system blamed or were people blamed?
· Were the root causes of the crisis identified?
· Were changes made to the system or were new polices and/or rules introduced?
· Was the rationale for any changes documented?
· Do you think the same crisis can happen again or have the changes made that possibly remote?
· Should you handle the next crisis the same or differently?
2. Review how actionable information is gathered and processed in your organization and answer the following questions:
· Is it necessary to gather some information by holding meetings?
· If so, could this information be gathered automatically just as well?
· Do you receive management information that isn't actionable or useful in some other way?
· If so, is this information useful to others or could collecting it be stopped?
· Is there information that you need but don’t get because no system is in place to gather and process it?
· Would implementing a system to provide the needed information be cost effective?
· If so, what information do you need to convince others that the information is worth collecting and processing?
3. Think about things that might be wasting your staffs’ time unnecessarily. Would time logs confirm your intuition and give you the information needed to fix any of the time wasters you suspect exist?
4. Have you observed situations of over staffing in your enterprise? If so, what was the evidence that indicated over staffing existed? Do you think you would recognize over staffing if it occurred again?
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