Company Initiatives are like the movie, “Groundhog Day”: Doing the same thing will not change things
This is the punch line of a commercial played during the NCAA College Basketball Final Four several years ago. The gist of it was that the company had hired a consultant to help them with some problem. He gave them ridiculous advice requiring only about 20 seconds, presented an invoice and left. One of the executives watching this unfold replied, “And he doesn’t even stay around to see if it works!”
When I came into business nearly 40 years ago from a clinical setting, I was surprised to learn that companies invest in lots of things for which they don’t have a way of seeing if the change worked—or not. Coming from the land of psychiatry and mental health, it was easy to excuse doctors who would take a patient’s opinion as to whether the treatment was effective. They had little data other than verbal reporting. Looking from the outside, it appeared to me that business had it better because they had measures. That meant that they could eliminate opinion for facts. Unfortunately, when I got on the inside, I found that fact-based decision-making was not substantially better than in mental health. Businesses did have better data, but they often overrode it with their opinion or experience, “In my opinion…” or, “My 40 years of experience leads me to believe…”
If I have heard it once, I have heard it a thousand times, “We tried that and it didn’t work.” Oh, they might have tried it, but how did they know that it didn’t work? How many companies that started the next best thing, really know whether it worked or not? In my opinion, not many. If things got better, they assumed what they implemented caused the improvement. If things stayed the same or got worse, they placed the blame on it being the wrong thing. Seems simple enough. By that kind of analysis, most initiatives started in good times work and most started in bad times don’t. As the saying goes, “A rising tide floats all boats.” Unfortunately, as Warren Buffet said, “It’s only when the tide goes out that you learn who’s been swimming naked.”
It is very important that all businesses have a way to separate real from apparent causes. A new machine that the manufacturer claimed would increase production or quality doesn’t live up to that promise. Does that mean that the manufacturer lied or mislead you? Not necessarily. It may be that it was not run according to the manufacturer’s process.
Look at it this way. If you have a process that has been implemented poorly and you introduce a new one, what confidence do you have that the employees will implement the new one any better than the old one? Some say that we will train them in how to implement the new one. The problem with that is that the employees also were trained in the old process. Employee behavior is rarely considered to be an important variable in a new process, particularly a technical one. However, I have never seen a process that somebody couldn’t screw up. All of this is to say that whenever any change is made, a way to separate the effect of the process from the behavior is of the utmost importance, but rarely done. In other words, did it not work because it was a bad process or did it not work because we did not implement it the way it was designed? While this is relatively easy to do when you have equipment of some kind, when you don’t, many managers are lost.
Take bonus plans, performance appraisals, stock options, Statistical Process Control, Lean Manufacturing – you name it. I suggest that most of these initiatives do not produce the desired results because they are not properly evaluated. The performance appraisal system is a perfect example. No one in business who receives one is happy with the process. It has been tweaked a thousand times and it works no better today than it did 50 years ago. The same is true of bonuses, stock options, raises and uses of compensation designed to motivate or create loyal and engaged employees. If we don’t know after 50 or 100 years whether something produces value, how long will it take to know? The sad news is that there are ways to sort these things out now, but they are little known.
Behavior analysis, the science of behavior, has several tools that can help. Although it has a research quality, it allows executives to know how effectively they are using the resources of the company to increase valuable behavior. Let me mention two.
One is what is called an ABA design. It is where we collect a baseline performance, implement a specific intervention and look at the change; then stop the intervention and see what happens to the behavior or result. If after withdrawing the intervention (increase in pay, more frequent evaluation, terminate performers below a certain performance level or requiring a doctor’s excuse for an absence, for example) the performance returns to baseline levels, we have good evidence that the change did not work.
Another is to pinpoint an outcome, get a baseline and then stagger the implementation across shifts, teams, departments, etc., then look at changes. If all of these entities improve only after the interventions, even though they were started at different times, it gives one confidence that the initiative was responsible for the improvement.
While it is not possible to detail these tools in this article, it is important that whenever any organizational change is proposed, executives ensure that a plan exists to properly evaluate the effectiveness of the change. Such evaluation should not be made through opinion, but through properly evaluated facts and measurement. This is the only way that organizations can avoid the “Groundhog Day” syndrome and achieve measurable and sustainable change in the most efficient and effective manner.