Resilience Now!

It is easy to become cynical when you write about business. The professional world contains mediocre people who get by on connections and charm. Global capitalism's daily grind can often destroy people as it makes decisions in amoral and bureaucratic ways. A cynic or nihilist would snidely chuckle at these realities and say that nothing can be changed and we must accept this adverse situation.

I come from a pragmatic point of view. Business is also a tremendous engine for wealth and good. Under the correct management, I have seen businesses transform communities and improve countless people's living standards. One of those people was me, and I dedicated my career to making business more sustainable, satisfying, and sane. It is a mission of mine. Today, I want to continue my series on changing our perspective on business transformation. 

Since the founding of the Chicago School of Economics, a dominant theory has overcome business leadership. The approach is called the shareholder value hypothesis. It says that the only purpose of a business, especially a multinational corporation, is to generate profit and provide it to the shareholders who pay for the business. In its most simple formulation, the demands of customers, employees, the community surrounding the company, and the environment are less critical than shareholders.

It created plenty of wealth but was not shared equally, leading to the migration of manufacturing jobs to countries with lower wages. It also put power in the hands of people who knew accounting and sales. With a few changes in the accounts receivable report, or a budget cut, share prices would improve without a significant improvement in sales or customer satisfaction. It explains why Southwest Airlines neglected its primitive flight scheduling system until it failed and why a company like iHeart Media is canceling its 401k match. None of these things improved the business of helping customers; instead, they saved money to pay more significant dividends or buy back company stock to juice the share price. 

We find ourselves amid an economy in recession and still generating record profits. The COVID-19 pandemic showed the bankruptcy of this approach because as the world slowed down, thanks to people getting sick and dying, the ultra-efficient networks of supply chains sputtered, and the economic principle of supply and demand began to drive up prices. These efficient systems could not handle disruption, and soon businesses are scrambling to find the raw materials they need to keep operating. People who warned that something like this might happen were shunned in plenty of corporate boardrooms because they were right. After all, there is nothing a potential master of the universe wants to hear less than they were wrong.

Consultants see this situation, and it is evident that we need to focus on making businesses more resilient and responsive to customers. Supply chains need to be more redundant so they can handle disruptions. Information Technology systems need less technical debt and better reliability. The decision-making process must focus on what suits customers and revenue so shareholders get paid with real profits instead of Two Olive solutions. Customer delivery will help fix many self-inflicted wounds that business has created over the last thirty years.

Agile plays a role by allowing people to measure more than dollars and cents. It holds a mirror up to the business; their leaders must be wise and humble enough to act on what they see. Resilience is a verb, and the professional class must practice it. It requires discipline and a sense of hard work, but it is possible. 

Until next time. 

Artificial Intelligence is Hungry and Agile is Ready for It

In my blog last week, I argued that the agile community needs to shift its focus from transforming organizations to delivering agility to customers. I promised to provide additional details and explain why this shift is necessary. Today, I want to concentrate on the world-consuming qualities of software development and the changes its bratty cousin artificial intelligence has in store for us. 

Twelve years ago, March Anderson, one of the founders of Netscape, which helped create the internet economy, authored a prophetic article in the Wall Street Journal called "Software is Eating the World." Anderson argued that software was becoming more dominant in managing the global economy. Corporations must behave like software companies instead of traditional businesses to remain profitable. It sounded crazy and like much of the hyperbole surrounding the technology business in the giddy and stupid days surrounding the first dot.com bubble.

It's been years since Anderson's prediction, and it continues to prove itself true. Just take a look at Southwest Airlines, Volkswagen, and Boeing. Inclement weather forced Southwest Airlines to ground flights due to faulty software. Volkswagen found itself in a scandal where special software deliberately altered diesel emissions to falsely show the vehicles were better for the environment than they were. And the software in Boeing 737 jets was directly related to fatal crashes. It is only the tip of the iceberg, however. In our daily lives, algorithms, and software play a significant role, from streaming movie services to grocery shopping. Clearly, Anderson's prediction is more relevant today than ever - software is playing an increasingly important role in the world.

Unfortunately, my experience has shown me that many business organizations do not understand the importance of software until it is too late. Often it is when a competitor can do things at a lower cost or when software breaks when business leaders understand the crucial nature of software. It also became evident that how they were doing business was not compatible with a global economy. It is a harsh lesson, and I continue to see it taught daily in the board rooms and cubicles of modern business. 

The solution to this challenge is to change how we do business from a command and control emphasis to a more collaborative one where ideas blend to help deliver value to customers. It is very alien to people accustomed to giving orders and expecting obedience. Creating software is collaborative, data-driven, empirical, and exhaustive. If it were easy, everyone would do it, but it takes special skills and a particular temperament to be good at it. Furthermore, less than a fraction of one percent of the world population can build software even though we depend on it for survival. So software is eating the world, growing more ravenous each day. 

Where does artificial Intelligence fit into this picture? It will change office work, and we are already seeing companies like Microsoft and Google attempt to add the benefits of AI into their products. Some of it is mighty cool, and other parts of it are forgettable. I see some of the most powerful use of AI in writing. I leverage tools like Grammarly and Wordtune to ensure good grammar and spelling. Lately, I have been an early adopter of the Bearly AI tool, and it has many possibilities but still needs significant improvements to attract the attention of a more mature audience. 

Despite the attention, like the fawning 60 Minutes segment this year, artificial Intelligence has a long way to go. Image recognition systems with AI are terrible.  These systems can not distinguish between a dog and a piece of fried chicken. Artificial Intelligence can write basic software code, but the programs are simple and rudimentary, so it still requires people to take the complex needs of business people and interpret them into code that will live in production. Finally, we have the problem of bias and hallucinations in Artificial Intelligence, which will be an ongoing problem.

Soon, people who can use AI effectively will be like software developers because they will train the systems which make the world operate. So I see Artificial Intelligence not as a threat but as a tool for business. It can help improve productivity and reduce mistakes, but human values and judgment are critical to success in business and life. 

Agile fits into this worldview because it helps you leverage the technology of software and Artificial Intelligence by measuring results, making corrections, and testing them again in real-world situations. If we are to deliver agility to customers, we should be able to inspect and adapt to change as it happens. Otherwise, we are going to crash and burn horribly.

Until next time. 

The Agile Transformation is Dead, Long Live Agile Delivery!

The global economy is unforgiving. Supply chains are fragile, and increasing pressure to do more with less pushes people past their limits. The pressure is causing people to crack under pressure, from entry-level workers to CEOs. Even minor stumbles can have significant consequences, costing thousands of jobs and billions of dollars. As an agile professional with more experience than I care to mention, I have reflected on what has happened in the business world over my career. I have witnessed plenty of positive developments, but businesses continue to struggle to deliver value to customers and maintain a sustainable pace of work. The conflict between labor and management over remote work is just one facet of this challenge. The decrease in productivity is another. We need to shift the paradigm of how we think about business and how it operates. 

The idea that we rethink how we look at business has festered in my mind since the beginning of the COVID-19 pandemic, which is officially ending this month. Business in the Western developed world was able to adapt to the crisis, but workers and governments absorbed the primary burden. The contradictions of our business culture were visible for everyone to see. The last three years of experience also made me reassess some of the ideas I have relied on in my career. 

Based on that reassessment, I have developed some postulates that will guide my future consulting work.

1. Software continues to eat the world, and AI will play a significant role. 
2. If we want more productivity, we need greater resilience in our business environments rather than efficiency.
3. Change is moving faster than ever, and it is exhausting.
4. Businesses that behave like a hierarchy will be less adaptable than those which act like a network.

I have written about these topics for years, but the pandemic clarified these thoughts. As agile coaches or scrum masters, we must educate our teams and leaders about this new reality. Taking these postulates together, we must draw a new conclusion about how the world of work needs to behave. 

First, transformation must be intentional and focused on delivering value to customers. Ultimately, customers pay the bills, and we need to get solutions to their problems into their hands sooner. Ultimately, customers pay the bills, and we need to get answers into their hands sooner. Transformation efforts that do not consider customers' needs are a waste. Wasteful transformation efforts squander the time, money, and energy of the people who generate profit for the organization. 

Next, we have focused too much on efficiency and running lean and mean organizations, which are fragile when market conditions change. SVB bank, Facebook, and Microsoft experience layoffs and financial losses when interest rates increased. Business leaders should be smart enough to exist in high or low-interest economic environments. Still, the pressures of meeting shareholder expectations meant they optimized their business for low-interest environments. Everything was perfect until interest rates increased; Microsoft has now canceled employee bonuses for the year. 

Third, top-down management is beginning to fail as productivity numbers continue to fall. According to the Harvard Business Review, the average employee struggles with ten enterprise change initiatives in 2022 compared with just two in 2016. The accelerated rate of change is exhausting the workforce and reducing productivity. If you want to know why people are quitting, they are tired because they are not getting ahead financially or professionally. Furthermore, much of the change is imposed from the top down with little say from the people doing the work, fostering resentment and resistance. Thus, it is essential that change radiate from the organization's middle to executive leadership and frontline workers. 

My ultimate conclusion is that companies must move away from the feudalistic framework and towards a more interconnected system. The current corporate management methods, such as the forced elimination of the bottom 10% of employees and stacked rankings, have only resulted in a culture of fear and mediocrity. Networked organizations are far more capable of generating lasting value than their hierarchical counterparts. General Electric, one of the most renowned conglomerates in history, is a prime example. When Jack Welch was the CEO, he created a personal empire that was not meant to last. Many of his techniques were praised by the public and the business world, but hindsight has proven that Welch's top-down style was no more than a facade. After his departure, GE was split into three separate entities and lost almost all of its value. It indicates that companies that do not rely on a single dictatorial figure are much more established and thriving in the long run.

Change management and agility are the wrong perspectives when making a global business more successful. Instead of management of change or agility, we need to deliver agility. Organizations must adapt to changing conditions, be more resilient and less efficient, become less hierarchical and recognize that people have limits and need respect. 

I will write more about this, but today I understand that for a business to be successful, it needs "Healthy Ownership" and "Agile Delivery." Anything else is last century.

Until next time. 

Remote Work is Worth It

The world of work feels like living on an ant farm. You toil away at your section in full view of some mysterious patron and hope you survive the next day. It is an uncertain existence, and there is no guarantee that a child might shake the entire structure for fun. No wonder US productivity figures are down. Frightened workers filled with existential dread are less productive than those with better psychological safety. This week workers in Canada went on strike for better wages and the right to work remotely. Business leaders are pushing back on efforts by employees to work remotely, and I want to discuss it. 

The environment in many large corporations is more like a feudal kingdom than a customer service organization. Unfortunately, those in positions of power at the top often have a disproportionate amount of authority, money, and job security. Additionally, business leaders treat those who generate profit as expendable resources. This unequal distribution of power can lead to a lack of appreciation for the hard work of those driving the company's success and a feeling of frustration and injustice for those on the front lines. Corporations need to recognize their employees' hard work and create an environment where all team members, from the top down, feel appreciated and supported. 

I also suspect that it contains a dose of retrograde thinking shaped by unhealthy attitudes about masculinity. Despite all the changes in the workforce since the 1970s, the business world is still a boys club for mediocre men. Joan Williams, the director of the Center of WorkLife Law at the University of California College of Law, summarized the philosophy best: "These are men with very traditional views, who see the home as their wife's domain and work as men's domain." 

Women, people of color, and LGBTQ folks can join this club. Still, they must be hardworking, dedicated to the firm, hide their authentic selves, and avoid taking time off for childbearing, raising a family, or looking after aging parents. Finally, these people need to be replaceable because the market is the only constant, while people, in the words of Donald Rumsfield, are fungible. 

Employers see remote work as a way to balance family demands with work, while leaders see it as a reflection of "softness." This worldview makes the conflict between business leaders and employees so divisive. Remote work is for sissies who do not want to advance, and it is an expensive perk that was necessary during the pandemic, but now that we have vaccines is unnecessary. It is easy to see why civil servants want to strike about the right to work remotely. Then they can do the necessary work and still care for obligations outside the office. 

Many leaders come from narrow social circles and cannot recall working with women or people of color as equals. Thus, they are biased that what worked for their careers will work for all the other employees at the firm. Leaders like this also need to understand what the people who work for them are doing. A software developer attempting to solve a gnarly problem will not write as many lines of code as an engineer mocking up interfaces for APIs. 

It creates something called productivity theater, where people look like they are busy when they are acting for the benefit of the boss. Instead of working on helping the business and helping customers, contemporary workers spend time in empty activities and acting out a performance of productivity. For leaders used to the status quo, this is better than measuring performance and managing a team remotely. 

As an agile coach or scrum master, you must meet employees where they are, balancing commitments inside and outside the office. A new mother will want to work from home, and when they come into the office, they will need a place to use a breast pump which is private. A project manager who must take a call with India needs to go home early or work from how because the sleep schedule is different from other people in the office. It is not easy, but with some empathy and effort, a remote office can work better than everyone sitting in a cubical. 

It is not easy leading other people. Leadership requires emotional labor, patience, and a thick skin. Being in charge also requires you to see people like the individuals they are instead of ants toiling away on an ant farm for your amusement. Finally, you can adjust to changing conditions and treat them as opportunities to improve the business. Allowing remote work is one of these opportunities we could not miss.

Until next time. 

Downtime is Never A Bad Thing

In The Shining, Stanley Kubrick portrays a writer's slow descent into madness. As an audience, we watch him pecking out words on a typewriter as he struggles to finish his first novel. Later in the movie, the writer obsessively typed, "All work and no play makes Jack a dull boy." It is too late when the other characters discover this, and Jack is now delusionally homicidal. Kubrick is poking fun at his obsessive image and, at the same time, highlights it is helpful to take a break from writing. 

I ran away from home this weekend and attended the HMGS Little Wars game convention. It was a chance to catch up with friends, play a few board games, and shop. Instead of pecking away at a typewriter, I decided to experience a change of pace, a healthy antidote to the grind of work. These moments of rest are a great way to recharge my mental batteries and prepare for future challenges. If you are in charge of others or coaching, each business leader should remember to point out the importance of rest because all work and no play is a recipe for disaster. 

Global capitalism is not the most mentally healthy place. The demand for performance and the emotional insincerity necessary to keep customers and colleagues happy is exhausting. That exhaustion can come out at inconvenient times, as it did with MillerKnoll CEO Andi Owen during her town hall meeting with employees. These emotional outbursts create a reign of terror in the cubicles where now the people generating the revenue for the organization are worried about external forces outside their control and internal forces which are equally out of control that could spell doom for their careers. It is a toxic mix that does not have many good outcomes. 

It is why we need to prioritize rest during slow periods and times of retrenchment. Encourage people to train on new technologies. Spend time tinkering with different approaches to work and spend time with family and the ones you love. If you do these things, it will build morale in your teams and could make the office a little less crazy, and that is something we could all appreciate. 

Until next time.