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Jumping the S-curve

By Gary Wong  ·  September 29, 2011  ·  Managing Complex Systems

One of the CE graphics that produced an "Ah-hah!" moment for me was Dave's S-curve diagram. It wasn't the first time that I had seen S-curves. At the global consulting firm where I worked, there were plenty of S-curve charts showing industries and firms going through life cycles. My "Ah-hah!" occurred discussing the bubble formed where the declining curve intersects the emerging curve of the new paradigm. This is where it hit me - if we pay attention to the weak signals and probe the outliers, we can help clients jump onto the next S-curve.

I joined Ernst & Young at a time when the major consulting firms were deeply immersed in the Systems Thinking movement. Our suite of offerings incorporated Business Process Reengineering, 5th Discipline, Balanced Scorecard, Knowledge Management, to name a few. It was an adrenaline rush learning the various methodologies, albeit drinking from a fire hose. While a lot of revenue was generated helping clients with strategy formulation and process improvements, the big money was in selling and implementing ERP solutions (viz., SAP, PeopleSoft, Oracle, JD Edwards, Microsoft). Other emerging IT solutions included CRM, Supply Chain, and HR software systems. We were moving fast and upwards on the Systems Thinking curve, shifting from a control of function mindset to one that focused on the control of information.

Executives were eager to jump onto the next wave of computer technology. There were many testimonials about successful ERP implementations yielding incredible results. Yet IT analysts such Gartner expressed concern that, according to their surveys, the overall success rate was around 30%. In terms of the Cynefin Framework, I reflect back and try my hand explaining why 7 out of 10 implementations fell short.

We truly believed we were offering Complicated Domain solutions that over time would become Simple Domain standard operating procedures. In short-hand, it was "PPT": enabling People to perform in a Process supported by Technology, primarily IT.

Unfortunately, for many projects the actual practice was: Install the generic IT package and then train people to use the built-in work processes. Some customization was permitted but the main drivers were work standardization coupled with cost reductions to achieve the bottom-line savings. Project manager performance was measured on achieving the 4Cs - Content, Compliance, Coordination, Control.

I now recognize that the above 4Cs are all elements on the Ordered side of the Cynefin Framework. In the evaluation phase meetings, we concluded if you missed out on a couple of Cs - Context and Culture - you got another C - Chaos. Hmm, these are all elements on the Unordered side.

How we generally dealt with Context was quite revealing. Benchmarking studies and "best practices" visits were an integral part of the Diagnosis phase. We believed because it worked for others that must mean it should work for them. Even if employees voiced concerns that "it won't work in our company", we assured managers that this was typical employee resistance to change. It would disappear once they abandoned the old and were educated on using the new.

IT's latest S-curve is all about Cloud Computing. As I'm writing this blog, my Inbox is being filled with emails about iCloud, Cloud Power, SaaS, and so on and so forth. If one of your clients or someone in your firm were to ask for your advice, what would you say? How might you as a Sensemaking practitioner assist them in preparing for the Cloud Computing wave? Here are some of my thoughts to get the ball rolling.

Situate the Network
As I mentioned in yesterday's posting, paradigms are not necessarily wrong or incorrect; they might be insufficient. Therefore, introduce the Cynefin Framework. Suggest that implementing a structured solution that has a strong degree of uncertainty and risk is on the border between the Complex and Complicated Domains. Because people are involved, identify and leverage their prevailing communication networks. Abandon the top-down one-way flow of information managed by control freaks. Instead of snapshot employee surveys, propose setting up a system to collect stories about the implementation. Imagine if anyone could enter a positive or negative story anytime, anywhere. Collecting stories could continue until a desired steady state is reached. How rich would that database be for analyzing in SenseMaker!

Fuzzy is better than Sharp when setting vision
Question: Which bird is a better predator? A sharp-eyed hunter that could pinpoint a specific animal 3 miles above ground or a half-blind bird that would pick up anything that moved, including rolling tumbleweed?
Answer: In a stable environment, pick the sharp-eyed bird. Hunting is easy and pickings are tasty. Ah, life is wonderful.
In a changing environment where windstorms, drought, or human intervention can drastically alter the food supply, go with the half-blind bird.
Why? Because Sharpie will starve to death since it only is able to hunt for choice morsels; chances are higher Blindie will eat enough to get by and survive.
So, what sort of environment are we facing today? I don't know about you but I feel I can handle the fast pace of change. It's the acceleration of change that's beating me up. There's no real client value in investing a lot of time sharpening their guesses about the future. Best to keep them fuzzy but clear enough to give a general sense of direction.

Sail, not Rail
My colleague Giuseppe helped me realize in my own consulting practice I was promoting an idealistic approach where you define how things should be and attempt to achieve it. An analogy would be building a train track and then driving the train to the destination station. If you derail, quickly work hard and sweat the assets to get back on track. Success is getting to that station on time and on budget.
In our naturalistic approach you start by setting a fuzzy vision. Then you introduce technologies and build practices on a safe-fail basis and see what works. Here the analogy is sailing a boat. Work smart by tacking and beating as uncontrollable currents and winds change. Try to stay on heading, learning as you go. Understand it's okay to be off track most of the time. However, if you discover a more attractive port over the horizon, be prepared to alter course and go there instead. Seek and embrace serendipity.

What would you like to add to this list of Dos and Don'ts?