Schlagwort-Archive: Active

Planned futility – eyes shut and get through

The absurd business acceleration and geographic dispersion and the flood of data in the VUKA world force executives to think in new ways. Trapped in their attention horizon, they have limited foresight and an inability to master cultural realities and the data deluge. Short-term (mis-)successes determine their fate. It does not matter if leaders ignore accessible data, do not find available insights, or fail to foresee circumstances. Eventually, it leads to decisions that pursue modest intentions without considering possible side effects. Nonetheless, the top team is expected to produce impactful decisions and outcomes. It develops plans to avoid individual disadvantages that seek change while holding on to the existing to avoid personal risks. This approach has come to be known as Planned Futility.

Since the last remaining raison d’être for leaders are their directional decisions, they must face the question of how to manage unintended consequences. The following four leverage points expand the awareness. They reduce the occurrence and downsides that appear out of nowhere.

  • Aligned, although not targeted?
    Simple planning relates solely to the desired outcomes – What? To what degree? By when? With what budget? That way, an orientation is given, but the essential aspects of targeting are missing, i.e., not considering basic conditions to avoid unintended consequences. It leads to unwanted surprises. It is smarter to consider as many dimensions of the initial situation as possible (e.g., with STEP). (1) To ensure that one has sufficient knowledge regarding the task, a Google search of the topic is recommended. (2) During preparation, the support of the relevant stakeholders must be obtained for having sufficient room for maneuver. (3) It helps to review from the affected parties’ point of view for considering their interests at an early stage and make them to people involved. On this basis, the probability of achieving the desired results increases.
  • Active, although the time is not used?
    The ever-flatter structures of companies increase the number of decisions managers take. The fear of making mistakes causes some to freeze. In doing so, they overlook that time moves on and that even the avoidance of decision-making are momentous decisions. In order not to leave the decision-making to others, leaders have to keep moving. In the process, the horizon of attention shifts incessantly, and the original findings lose their significance. Intermediate outcomes or the interplay of building blocks may be affected. Leaders must revise their decisions to reflect the evolving interests of stakeholders. The results are decisions that lead to plan changes that must be communicated to all stakeholders and affected parties. These adjustments further ensure that unintended consequences are avoided whenever possible.
  • Monitoring, although conclusions are not drawn?
    A popular solution seems to be comprehensive reporting. Instead of enabling solutions, vast amounts of measurement points are established. The stakeholders must deliver them with great effort in ever shorter periods. If qualitative aspects are involved, adequate surveys are set up to generate the metrics. In the end, one gets a vast amount of measurement data that is difficult to utilize and even does not result in actions through appropriate traffic lights. We can only hold seven-plusminus-two chunks in short-term memory. This means that we cannot handle this flood of data at all. For this reason, we should take the time to find the essential checkpoints that let us see the progress or developing needs for action. Since many influencing factors are not accessible to neutral observers, an intensive exchange of ideas with all those involved is crucial for leaders. Management by Wandering Around is a prerequisite for it. However, the collected findings must subsequently be put into a format (e.g., using a satisfaction scale or a heat map) understood by those involved. With manageable reports, you lower the occurrence of unintended consequences.
  • Assessing, although there are no sanctions?
    The desire to assess leadership quality creates new performance assessment models (e.g., Feedback, 360-degree Assessment). The focus here is on measurement and less on effects. Looking at large companies, you often see that even measuring is canceled as soon as the results become nasty for the individuals. How detailed leaders are examined is more important than the consequences. Except: Rewards are in place. What is missing in most cases are sanctions that tangibly punish misconduct. Why should leaders try hard if they do not have to expect any disadvantages in case of failure? Beware! It is about the leaders, whose role models and leadership are the remaining tasks. Failure due to poor preparation, visible inactivity, and lack of visibility are building blocks of homegrown leadership failure. Without sanctions, decision-makers lack the inducements, ensuring that there are a few unintended consequences as possible.

Bottom line: For artisans, it is easy. Mistakes are immediately visible, audible, or tangible. The soft tasks of leadership can be approached with a similar mindset. An example provides the German federal government’s handling of Corona. The actions are focused on providing sufficient intensive care beds. The unintended consequences in the economy and society are ignored. Every effort is made to contain the spread of the virus. In a year, nothing significant has changed. For example, it has not been achieved to collect the incidence even on weekends. The evaluation of the situation leads to ever-changing limits, but not to effective measures against the active dissidents. As a result, any pleas fall flat, and industries face a broad wave of bankruptcies. The federal government’s unilateral action is an excellent example of planned futility – eyes shut and get through.

Active and passive components of a deliverable

The products and services that the one company supplies or the other procures, always consist of an actual deliverable with the active components as well as additional deliverables, the passive components, that are provided quasi automatically. Only if all aspects are put on the table, you can compare objectively. On supplier side, you get the arguments for the pricing. On customer side, the criteria for the selection and the decision can be derived. The time for describing the active and passive components of a deliverable and their consideration in the price comparison is well invested on both sides.

PassivAktiv

In order to understand all aspects of a deliverable or to be able to compare them, the active and passive components of an offer should be specified in detail.

  • Active components
    The active components of a deliverable are the functions that are the customer’s major interest. Products are used (e.g. the car, the smartphones, the cooking pot) or spent (e.g. gasoline, food, electricity). Services are executed related to a person (e.g. a consultation or a care) or to an object (e.g. repair, maintenance) and cannot be stored or transferred. Even if all these components are obvious, ALL should be described.
  • Passive components
    The passive components of a deliverable are the aspects that are delivered on top to the obvious active ones. These are essentially the qualities of the deliverable (e.g. the reliability, the safety, the economics, the brand, the experience) and information (e.g. the concepts, the branch knowledge, and the relationships) that are created in the course of providing the deliverable. They are rarely visible and are difficult to prove. For this reason, the absence of these aspects can only be seen, if at all, later in the process, e.g. after a breakdown or a quality check. In order to consider them in the selection process, the passive components should be estimated, e.g. by looking at the risks or by assessing the value-add.

The decline of the prices, due to the cheap production of the active components in countries with favorable production conditions (e.g. low labor costs, lack of environmental standards), leads to an increased importance of the passive components. The value of a brand, safety or the reliability of a deliverable become increasingly part of the value-add for the customer. Thereby, higher prices that have nothing to do with the actual value of the commodity can be argued. The reputation of consumer electronics plays a more important role than its sustainability (e.g. if the battery cannot be changed, like in some Apple products). Safety for the avoidance of dangers or the reduction of the effects of an accident is also important criteria in the purchase process of a car. The same is valid for services. The higher daily rates of renowned management consultations are more accepted, although the assigned employees have a similar education, as the ones of a smaller company that costs less.

Bottom line: The value of products and services is determined more and more by intangible aspects. Therefore, the specification of the requirements and the selection of the deliverables must be well defined in advance, in order to make the offers comparable.