Don't knock the 'System' - you're part of it!

How often have you heard people, when confronted with a problem in an organisational environment, declare: "We're fighting against the system."  Maybe, but the comment implies that the person or people engaged in the 'fighting' are detached from the 'system'.  The title of the post states my position, which is that when we are engaged in activities with others then we are all part of an organisational system.  Clearly our individual roles have varying degrees of influence on the system's behaviour and crucially, the way the system behaves might not be what is intended, thus giving a feeling of fighting a battle for some of the participants.  Stafford Beer coined and frequently used the term POSIWID (the purpose of a system is what it does) to refer to the commonly observed phenomenon that the de facto purpose of a system is often at odds with its official purpose.  So if, for example, a company has as one of its stated objectives, to create highly satisfied customers, yet all too often it does not meet its customers' expectations, then its 'new purpose' is definitely at odds with what was originally intended and won't change just by top management rewriting the mission statement.

I once worked for a large multinational company with 145,000 employees.  It was steeped in traditions and rigid working practices that had created a distinct culture where lack of trust was endemic.  As such it was very difficult to get things done if you followed the rules. Shortly after I joined the company, I asked my manager how he coped with the stifling bureaucracy.  I will always remember his answer: "Forgiveness is easier than permission."  That was the advice I followed and it seemed to work for me during the six years that I worked for the company and I didn't seem to have to ask for forgiveness very often!

Clearly one's attitude to rules has to be carefully assessed.  It doesn't make any sense not to follow the rules of traffic lights - red=stop, green=go.  On the other hand, to take a short cut across the grass, as illustrated in the photo, could eventually create a more efficient route in the park, which might even lead to the unofficial track being paved!  The first ten, or even a hundred, of the walkers might have felt slightly guilty as they walked across the grass rather than using the path but with the passage of time, it would eventually become the accepted route - the 'new purpose' of the pathways in the park!  This is how evolutionary change happens, little-by-little and ultimately leading to significant effects.

So don't knock the system, accept the fact that you are part of it and its resistance to what can't be done can lead to understanding the part that you can play in seeking and implementing change.

It will come back to bite you....

It's a lovely idiom - It will come back to bite you - although these days, a more common expression is  unintended consequences, which is subtly different.  When something comes back to bite you, it's painful, whereas an unintended consequence can be positive as well as negative.  I also like Peter Senge's quote: Today's problems come from yesterday's "solutions".  So what's got me thinking on this tack today?  Well it's the news less than 48 hours ago of the carnage in Paris where innocent people were slaughtered, apparently as an act of retribution by Islamic State (IS).  Although this abhorrent act hit the headlines, it was regrettably just one of many examples of inexplicable mass killings and when the immediate and understandable response of abject horror becomes less dominant, the obvious question has to be asked - Why?  Politicians never seem to dwell on the why, but instead, what should be the immediate actions to be taken.  I suppose that's understandable because leaders need to be seen to be decisive.

François Hollande described the events as 'an act of war' but what does that mean and what action will be taken?  It is not a war in the conventional sense because there are no rules of engagement, or disengagement, with a terrorist group such as IS.  History has taught us that quick-fix "solutions", like intensifying the bombing of enemy territories in Iraq and Syria, could harden attitudes, make IS recruitment of disaffected young Europeans easier and lead to very negative unintended consequences, like what has just happened in Paris.

The purpose of this post is not to offer solutions but rather to warn against knee-jerk reactions because, in my opinion, it is the past impulsiveness of current leaders and their predecessors that has played a big part in the instability faced by the global community.  It is important to take the time to understand why it happened, before deciding what has to be done and how it can be achieved.  The current military strategy, whatever that is, doesn't seem to be leading to desirable results.  My final quote to end this post comes from Albert Einstein.   Insanity: doing the same thing over and over again and expecting different results.

The Business Case - whose case?

Have you ever had a bright idea blocked by the stock reply: "You need to produce a business case", which usually means your idea has not fallen on fertile ground.  But what's so special about a business case?  In my opinion, not a lot and I doubt the real game changers in history were preceded by business cases.  Here's a hypothetical example.  Imagine I am working as a special adviser to the UK prime minister (I wish!) and I come up with a business case to reduce the taxation on alcoholic beverages to increase consumption.  Why would the government want to do that when most responsible nations in the world are striving to make alcohol less attractive?

The starting point for my hypothesis is a real and recent report from the Institute of Economic Affairs, "Alcohol and the public purse: do drinkers pay their way?", which concludes that they certainly do. Here's the summary, italicised and extracted from the IEA website:

 

• This study estimates the direct costs of alcohol use to the government in England, including the NHS, police, criminal justice system and welfare system.  Taken together, they amount to a gross cost of £3.9 billion per annum (in 2015 prices). 
• Revenues from alcohol taxation in England amount to £10.4 billion, leaving an annual net benefit to the government of £6.5 billion. 
• The estimated cost of alcohol-related violent crime is nearly £1 billion per annum. Other alcohol-related crimes, including drink-driving, add a further £627 million, leaving a total cost to the police and criminal justice system of £1.6 billion. 
• The estimated cost of alcohol-related health problems is £1.9 billion. Half of this results from alcohol-related hospital admissions (£984 million).  A further £530 million is due to ambulance and Accident and Emergency attendances. 
• Welfare payments given to people who are unable to work because of mental or physical ill health problems that are attributable to alcohol consumption incur a further cost of £289 million. 
• This study uses the most recent health, crime and drinking data to build on previous cost-of-alcohol studies.  Cost-of-alcohol studies are plagued by a shortage of reliable data in several areas.  This study is no exception and its estimates should be regarded as being at the top end of the plausible range.  The gross cost of £3.9 billion is more likely to be an over-estimate than an under-estimate. 
• It is important to distinguish between social and economic costs (most of which are paid by individuals and businesses) and the costs to government departments (i.e. the ‘cost to the taxpayer’).  Intangible costs, internal costs and societal costs are often misrepresented as being costs to taxpayers.  This is the first study to have looked at the total net cost of alcohol consumption to the government in England. 
• Our estimates suggest that the net cost of alcohol to the state is minus £6.5 billion pounds, which is to say that drinkers subsidise non-drinkers to the order of £6.5 billion pounds a year.  The government could halve all forms of alcohol duty and still receive more in tax than it spends dealing with alcohol-related problems. 

So there is a financial case for status-quo-drinking and most business cases are financial cases, particularly in government circles.  Now if I was to be a little creative and suggest to the PM that a 10% reduction in taxation would lead to a 20% increase in demand, then surely that is a very powerful business case.  If the existing sales of S attracts taxation of y%, the revenue is Sy/100. So the increased sales is 1.2S and the new taxation is 0.9y x 1.2S/100, which is equal to 1.08 x Sy/100, i.e 8% increase in tax revenues.  If we assume that the costs of alcohol-related health and crime remain largely unchanged (a big assumption!), then financially it makes sense.

But we all know that alcohol-related problems cannot just be measured in financial terms.  The damage to society from excessive alcohol consumption, such as premature deaths, traffic accidents, workplace-related problems, family and domestic problems, and interpersonal violence, far outweighs the benefits of increased tax revenues.  If the business case was to focus on societal issues, rather than a simple cost-benefit analysis, then there wouldn't be a case!  Let me make it absolutely clear that I am in no way criticising the IEA report.  It does not purport to be a business case but rather an analysis of the cost or benefit to the exchequer of alcohol consumption in England.  It meets its purpose admirably and I have merely used it as a source of accurate data from which to produce my hypothetical example of how a misleading business case could be constructed.

Let's not get obsessed with myopic finance-driven business cases, particularly when complex societal issues are equated to simple monetary comparisons.  Money was a great invention, particularly for simplifying trading, but when it becomes the be-all and end-all of business cases, then we really are losing sight of what 'business' is all about.

Paradise Lost?

My wife and I have recently returned to the UK after nine years living in Turkey.  Our Turkish residence was situated in an idyllic spot, close to the coast where the Aegean and Mediterranean seas meet.  The environment and scenery are stunning - crystal clear waters, golden sands, forest-clad mountains, an abundance of wild life and if that’s not enough to tempt you there, the region is blessed with wall-to-wall sunshine from May through to October.

Before moving to Turkey, we lived in another tourist hotspot, near the UK’s North Devon coast.  This is also a beautiful region and although not benefitting from a Turkish climate, it does have a wealth of attractions for both visitors and residents.

We have now moved to London.  A strange choice you might think after two pieces of paradise.  To comprehend our decision, it is worth trying to understand what ‘paradise’ actually means.  Here’s one definition that I came across:

“A place or condition of great happiness where everything is exactly as you would like it to be.”

This definition cites two alternative states - “PLACE or CONDITION” - for which “everything is exactly as you would like it to be.”  For each of the two ‘paradises’ that I have referred to - the Turkish Aegean/ Mediterranean and the UK’s North Devon - it is difficult for most people not to be enthralled by the location (place).  Each has a unique beauty that when combined with a comfortable residence, could be described as a piece of paradise.

Now let’s consider the other state of paradise - the condition.  Although the place clearly has an influence on the condition, it is not the only driving force.  In fact, in my opinion, it makes a small contribution to the happiness equation.  It is only one part of “……..where everything is exactly as you would like it to be.”  Perhaps I could explain why neither North Devon nor Turkey met that demanding criterion.  

In the case of North Devon, it was its insularity.  Geographically it is not the easiest place to access in the UK. with no motorway links nor high speed rail access.  There is also a culture endemic amongst many of the inhabitants of not wanting to venture, or accept others from, outside the region.  During my time there, I was the boss of an engineering company that, in my view, was not as productive as it could have been because of its insular culture.  I doubt insularity is unique to North Devon, indeed it is probably found in many rural regions in the UK and around the world where a culture of ‘if you ain’t born and bred here, you’re an outsider’ prevails.

So what about Turkey?  Well I love Turkey and my life is much richer for having lived there, but the problem with Turkey is quite simply, ME!  In particular, my difficulty was my inability to communicate.  I had one-on-one Turkish lessons for over a year, which were excellent and certainly enabled me to get by.  So I could do the shopping, pay my taxes, fix the car - those day-to-day chores were not a problem.  But to have a really rich conversation, or even write a blog post like this, in Turkish was, for me, nigh on impossible.  The possible solutions to this drawback and assuming a high proficiency of the language is unlikely to be achieved, are to spend most of one’s time with English-speaking expat communities, which doesn’t appeal to me or my wife, or find Turks who speak English fluently - not as many as one might think.  When faced with those ‘restrictions’ it is easy to feel deaf and dumb.

So there we have it, two pieces of paradise that offer a lot but not enough to hold me back from seeking pastures new.  Have I now found paradise?  Of course not!  I don’t think it exists, which means I will never find it and therefore I can’t lose it.  So for me, paradise is never lost!

Shouldn't We Ask Why?

As I continue to observe the antics of the UK election debacle from afar, with competing politicians explaining how they are going to make life better for UK citizens, I wonder just how many rabbits there are to be pulled out of the hat.  I am also curious why so many vote-winning initiatives (at least that's what the politicians think) are only declared when an election is in sight.  But what is also noticeable, is that election rhetoric largely consists of disassembling the nation's problems into clearly understandable 'chunks', for which the politicians will explain what is wrong and how they will fix it.

I am an apolitical systems thinker.  I don't have much time for politicians or the political system, but I'm not apathetic and I do have concerns about and feel a part-responsibility for many of the issues facing the planet.  Most of the issues require a systemic approach and hence my desire to become more adept at systems thinking.  Without going into the depths of systems theory,  let me just touch on one of the characteristics of a good systems thinker, which is the ability to synthesise as distinct from analyse.  We all know that analysis comes naturally.  We take things apart to understand them and then having worked out what each part does, we put them back together to understand the whole. But is that enough?  I don't think so.  Consider a clock and the 'vintage' really doesn't matter, so an old clockwork model or one with a quartz oscillator would be equally acceptable.  We want to know how it works so we take it apart and lay all the constituent pieces out on a table.  We have three pointers, a printed face, cogs, a spring for a clockwork version, an oscillator for the later model, a casing, etc.  We examine each component, work out what it does, how it fits together with other parts, and how the whole lot joins up to make the clock.  Bravo, we now know HOW the clock works!  But do we know WHY we have a clock?  Well it's to give an indication of the position of the earth's surface that we occupy, relative to the sun.  That is synthesis.  In the words of Ackoff: "Analysis focuses on structure; it reveals how things work.  Synthesis focuses on function; it reveals why things operate as they do.  Therefore, analysis yields knowledge; synthesis yields understanding.  The former helps us to describe; the latter, to explain."

Returning to the election, don't we need an understanding of the issues that we all face?  Let's consider three old chestnuts dominating the political debate in the UK - the nuclear deterrent, the health service and housing.  The main parties are explaining to the voters HOW they would fund the deterrent, fund and improve the health service and create more affordable housing.  I would suggest more pertinent questions are WHY does the UK need a weapon of mass destruction, WHY is the health of the nation deteriorating and WHY can't many citizens afford to buy or rent homes?  I would also contend that asking the WHY questions very soon takes you beyond the artificial national boundaries into issues affecting our planet.

When the UK elections are out of the way, I will focus my attention on the run-up to the US Presidential election and no doubt get equally frustrated! .... WHY?!

The Battle of Closed Minds

I have been watching the UK election from afar, which is great.  It is not daily news here in Turkey, so I can dip into the election reports when I feel like it.  I started watching a televised debate between leaders of the opposition parties, with an invited audience and the event was chaired by the veteran political commentator, David Dimbleby.  The participants were Ed Miliband (Labour), Leanne Wood (Plaid Cymru), Natalie Bennett (Green), Nicola Sturgeon (SNP) and Nigel Farage (UKIP).  The current Prime Minister, David Cameron, and the Deputy Prime Minister, Nick Clegg, declined their invitations to attend.  The absence of representatives from the ruling parties shouldn't have affected the quality of the debate.  People know what they've got in power and have to make a judgement as to whether what the opposition parties are each offering, could be better.  So the battle of the closed minds commenced!

The election fervour, in my mind epitomises the danger of closed-mind thinking, which abounds in all walks of life - political, social, religious, personal, business, pleasure .... you name it!  I guess when we are born, our minds are open.  But as we adapt to the world we've been born into, the process of teaching from others, together with our own personal experiences, moulds our mind and thus provides the 'lens' through which we view the world.  We develop a complex adaptive system that, in my opinion, becomes more predictable in the way that it 'filters' information and produces opinions, as time progresses.  Our minds suffer from being too closed.  But that suffering is probably inevitable because closed-mindedness, or an unwillingness to consider new ideas, can result from the brain's natural dislike of ambiguity.  By default, we see a person with different views to our own, as an opponent.

So returning to the political debate, there were questions from the audience being answered by five individuals, each a leader of their respective political party, but very obviously driven by the straightjackets of their manifestos.  It soon got to the point in the programme, when whatever question was raised, I had a very good idea how each politician would answer it.  So the value of the debate to me was zero and I switched off after 60 minutes of the 90-minute programme.  Maybe I was being unfair.  Perhaps it is not unreasonable for a politician to stick rigidly to a party line and it's the electorate who should assess what's better for them individually and society collectively.  But does the electorate display open-mindedness?  The answer must be to varying degrees, which is why the results vary from election to election but never by very much.

It's slightly hypocritical for me to preach open-mindedness because I know I have plenty of mindsets.  That said, I do make a conscious effort to step away from my personal agendas and biases.  I find a powerful technique is true listening.  In the words of Stephen Covey: "Seek first to understand, then to be understood."  You can only understand by, at least temporarily, pushing your own preconceived ideas to one side and not, as is so common in political debates, using the 'listening' time to practice, in your mind, a pre-prepared response.  True listening really is very powerful and rewarding.  As Mark Twain said:  "An open mind leaves a chance for someone to drop a worthwhile thought in it."

"I would rather have a mind opened by wonder than closed by belief." - Gary Spence.

Whatever Happened to the Balanced Scorecard?

No, the balanced scorecard (BSC) hasn't gone away but I guess there has been a decline in popularity since Drs Kaplan and Norton pioneered its use in the early 1990s.  The BSC is used to manage the delivery of a business strategy.  Typically, the business will be viewed from four perspectives - Financial, Internal Business Processes, Learning & Growth and Customer.  It should be noted that the Financial perspective is a measure of past performance, which is driven by the management of Internal Processes, the development of human capital by Learning & Growth initiatives and maintaining first-class Customer and other external relationships.  So on one side of the balance we have the Financial perspective, which is balanced by the Internal Business Processes, Learning & Growth and Customer perspectives.  At the core of the BSC is the company's Vision and Strategy.  Introducing the appropriate measurement systems within each perspective allows targets to be set and actions to be taken to drive the business towards the achievement of its vision.

Sounds good doesn't it?  Well it did to me when I introduced it into the company that I was heading-up in the early 2000s.  For a while it had a motivational effect as it provided a means for most employees to measure their performance against the company's strategic objectives.  But did it improve the company's performance?  If I'm honest, I don't think so and when I talk to others who have experienced BSCs in different environments, there would appear to be a lot of criticism aimed at this type of strategic management tool.  At first sight, the BSC business model appears quite rightly to represent the business as a coherent whole, with four linked perspectives - Financial, Internal, External and Learning & Growth.  The coherence of the model, however, appears to get lost as the performance metrics flow into the bowels of the organisation.  Managers often pay lip service to the BSC and set their own ideas of performance targets on their staff, generally using metrics that are easily understood and measurable, but don't necessarily relate to the overall business objectives and strategy.  This can lead to conflicts in the organisation and the resultant degradation of overall business performance.

The problem would appear to be the cascading nature of management by objectives.  So, although the BSC at the top level looks like a systems representation of the business, once the four perspectives are managed as separate entities, systems thinking is replaced by reductionism.  It is assumed that the whole (business) can be managed by independently monitoring (through simple metrics) and control of (management by objectives) the parts (the four BSC perspectives and any subsequent reductionism).  It's all assumed to be totally linear so, for example, if within the Customer perspective, a salesman wins more orders, then that will in turn trigger the Internal Business Processes to do their job, generating timely deliveries and more profit....

....but it ain't that simple!....

And therein lies the problem.  Like many management fads and even long-running ones like the BSC,  there is an attempt to force a complex non-linear world into a linear mould.  The simple models of an unrealistic static business operation, might look good on a whiteboard or PowerPoint slide, but couldn't be further removed from the real world.  That said and despite the scars from my personal BSC experience, I do feel the BSC model does have a use, albeit limited, in strategic management.  The use of four perspectives to provide a method to examine any business and then looking at how those perspectives relate to the company vision and relate to each other, at any point in time, is worthwhile.  But don't spoil it all by assuming today's model will bear much relationship to next year's model.  What's more don't be naive and set up a whole host of simple metrics and mechanistic performance monitoring processes, under the assumption that the BSC will be the engine room to deliver the company's strategy.

Any business is complex and taking a simple view of it doesn't change its complexity.  We are part of that complexity and we can observe its characteristics and for sure we can influence its behaviour but we certainly can't control it.

For me, BSC RIP!

Your Theory's No Better Than My Theory!

We live in a subjective world.  Why?  Because we are all subjects and the objects around us are what we observe them to be.  Perception is reality.  So I'm not sure of the meaning of 'objectivity'.  If a square shape to me looks like an oval shape to you, but we both use the word 'square' to describe it because that's the language we've learnt, does that mean the shape has been judged objectively to be square?  Objectivity suggests we can get into the minds of others, which I don't think is possible.

If we can't be sure that the existence of a square shape is a 'fact', what about more complex assumptions that are generally known as theories?  I do a lot of reading and get involved in Internet-based discussions on esoteric subjects, such as systems thinking.  As soon as the word 'system' comes into play, it conjures up a plethora of meanings.  That's because systems are mental constructs and exist only in our minds.  A system is a set of interacting or interdependent components forming an integrated whole.  So a tree can be thought of as a system that includes a root, a stem, branches, leaves and internal conveying systems.  The tree is an open system that interacts with many other systems, including animals, humans, birds, bees, soil, atmosphere and the sun.  But it's not a system, it's a tree!!  If I draw a system diagram of a tree, it is merely a mental construct to help me to understand how the tree functions and explain my understanding to others, who, by the way, might think differently.  The map is not the territory.

We all have theories, which can sometimes be supported by sophisticated modelling and simulation techniques to make a point.  I don't have a problem with that because the more information we have to support a theory might allow our thinking to converge with others to the point where our perceptions might align.  The words I use to describe something might be similar to, or even the same as, the words someone else uses to describe something.  However, a square in my mind might be an oval in yours, even if our descriptions are the same!

What is sometimes irritating to me is when someone will support their opinion with a theory from a guru, like Russell Ackoff, Peter Senge or Buckminster Fuller, in a way that suggests the guru's opinion legitimises their own theory.  Why should it?  Why are Peter Senge's theories, for example, better than my theories?  Don't get me wrong, I have a great deal of respect for Senge et al, but we are all human beings with our own mental constructs that help us to describe and try to understand life.

"Theories pass.  The frog remains.

Thank you Jean Rostand. 

United by Red

Life is complex.  We think we have so much knowledge and understanding, yet surprises keep popping up after every twist and turn.  So it's little wonder that we crave for some 'anchors' that keep our ships in check whilst we bob up and down on the waves.  Maybe we are looking for a purpose beyond basic survival or perhaps we just like to follow others and reinforce an established common goal....like football....forgive the pun!

I have never been passionate about football, although I do enjoy a good game whether watching on television or, as I did the other day, whilst sitting on a London bus stuck in a traffic jam, observing a game in a park with lads who looked to be as committed as any English Premier League player.  But watching the occasional game is not the same as being committed to a football club, as a player, manager, support staff or fans.  For many, like the players and managers, the commitment can be short-lived, being, for example, with Arsenal one season and Manchester United the next.  But for fans the commitment is very often for life, boy and man, girl and woman.  Manchester United, for example, has fans all over the world and from every region of England.  They don't all come from Manchester!  They are from all races, religions, political affiliations, jobs and professions, but United by Red.  In any large group there are bound to be dysfunctional elements who practise racism, sexism and vandalism, which gives the media an ideal opportunity to focus on the unacceptable face of football to help sell newspapers.  United by Red will not, however, be destabilised by anti social behaviour, the unity of purpose provides a secure and stabilising influence in the supporters' lives.

In business life, unity of purpose is also an essential ingredient for success.  United by Apple could well be a slogan for the world's most successful computer manufacturer, although I hasten to add that's not its strap-line!  All companies are united by a desire to out-perform their competitors and maximise their market share, i.e. their position in their 'league table'.  Yet in companies, as in the world of football, there are undesirable practices, which might temporarily sour a company's market reputation but rarely tarnish the corporate desire to succeed.

In political life a common purpose can also mask abhorrent acts.  In Hitler's Germany, for example, racism, especially anti semitism, was a central feature of the regime.  Many Germans, however, turned a blind eye to the atrocities directed by Adolf Hitler, whilst in the midst of the Great Depression, the Nazis restored economic stability and ended mass unemployment.  Extensive public works were undertaken, including the construction of the Autobahns.  The return to economic stability boosted the regime's popularity and provided a unity of purpose.

So it is evident that we homo sapiens seek and are driven by unity.  Yet we will accept the positive and negative aspects of that unity.  That begs the question, how bad does the unacceptable face of unity have to be before we no longer want to be part of the united front?

United by Red....So what's your Red?

Shale Gas & Fracking - Week 4

It's the final week of the MOOC and it's a shame because I am thoroughly enjoying it but all good things come to an end!  This week we have learnt about regulation, communities and public engagement.  There's little point in me using this blog post to repeat the course material, I would rather summarise my closing thoughts on the issue of fracking to society.  I will admit that my views have changed somewhat during the period of the course.  Opinions amongst those who are directly engaged or have an interest in fracking, appear to be polarised - for or against.  At the beginning of the course I was against and now that we are approaching the end of the course, I'm still against.  So what's changed?  Well, three weeks ago I was very dismissive of pro-fracking views, whereas I now have a greater understanding of the pro-fracking arguments.

Professor Sarah O'Hara provided an excellent presentation on the perceptions of shale gas where she summarised some of the results from The University of Nottingham shale gas survey, which has been running since March 2012.  One of the most interesting results, from my point of view, was that although there has been a decline in the yes vote since the Balcombe protests, still over 50% of the population are of the view that shale gas extraction should proceed in the UK.  Public opinion really is split and in my opinion, that's not surprising when you view the issue from the perspectives of UK national energy security, an alternative to 'dirty' coal and a 'bridge' to a low carbon economy.  If you look at fracking from these three perspectives in isolation and within the framework of a well regulated and therefore, hopefully, safe environment, there is almost (but not quite!) a compelling argument to proceed with fracking for shale gas.  In my opinion, however, where the argument is flawed is when you look at the bigger picture and in particular, the urgent need to tackle climate change by drastically reducing carbon dioxide emissions and well before the timescale of a 'bridge' to a low carbon economy.  So I believe we need massive global investment into renewables, or even 'safe nuclear', now rather than pursuing a diversion into shale gas.

That's it!  I've had my say.  Thanks to Sarah, Mat and Wil, together with their supporters and all the guests, for a really first class MOOC, which has been a fantastic learning experience for me.  It's been great! 

Shale Gas & Fracking - Week 3

Well it's week 3 and the time's flying.  This week we are learning all about the environmental considerations.  Oh boy, there are plenty of conflicting opinions amongst the experts on just how clean, or conversely how dirty, shale gas is.  The arguments are continuing to be well debated on the course.

There is a lovely phrase, which is "the bridge to a low carbon society".  A few words that make the extraction of shale gas by fracking seem such a logical thing to do.  The argument goes something like this.  Energy emissions from shale gas are about 40% cleaner than coal, so let's use shale gas as a replacement for coal on our journey (hence the 'bridge') to something even cleaner.  Sounds good!  But then along came a guy called Howarth who looked at fugitive emissions (leakages of methane gas during fracking going straight into the atmosphere) and he concluded that when viewed on a timescale of 20 years, the greenhouse gas footprint for shale gas is at least 20% greater and perhaps more than twice as great as coal.  Wow!!

Well of course Howarth really did rock the boat until Cathles offered his response and argued that Howarth's analysis was "seriously flawed" because he had overestimated the fugitive emissions.  So who's right?  We don't know because there isn't enough evidence to make a judgement.  Now that in my opinion is the real worry.  The 'bridge' is beginning to feel a bit wobbly.

As well as greenhouse gas emissions, we also learnt about other concerns like seismic activity, water pollution and the possible harmful effects on health.  There is a tremendous amount of data but really no firm conclusions because many of the findings were by inference rather than evidence-based.  I haven't trawled through all the comments that have been posted, but it would appear the views are very polarised for or against fracking.  That said, there are many well-thought-through arguments to support each stance.  Have I changed my anti-fracking views?  No, but I do feel I am becoming much better informed.

Shale Gas & Fracking - Week 2

I'm now into week 2 of the Shale Gas & Fracking Course.  This week we are focussing on the economics and energy security of shale gas development.  The material and quality of tuition continue to be excellent.  Although I admit to being opposed to fracking, I came into the course determined to become better informed and take a serious look at both sides of the argument.  Well so far my views have not changed.  The information provided on the world's energy mix and specifically the actual usage for 1990 to 2012 and the forecast for 2012 to 2035, illustrated a predicted growth in energy requirements and a continuing dependence on fossil fuels.  Probably not surprising as the data were provided by BP!  My comment on the forecast is that it would appear to be an extrapolation of the past with a small increase in absolute terms of renewable energy.  Maybe that's what will happen if we continue business as usual, but as far as I'm concerned that is a totally unacceptable scenario.  We should determine what energy mix there needs to be by 2035 if the planet has a chance of survival and then take positive actions to achieve our objectives.

As well as some very informative material on natural gas and how it's used, we were also provided with an analysis of energy security, as well as a positive and a negative view on the economics of shale gas.  The debate will continue with an online discussion later this week.  I don't want to repeat the course material in this blog post, so I will conclude this post with my personal view based on the debate so far.  I feel that no matter how the economic argument is presented, the financial justification for fracking is extremely flakey.  But that aside, I think the cost benefits or penalties are immaterial.  We really shouldn't be perpetuating the combustion of fossil fuels.  In my opinion, shale gas will not provide a bridge to a low carbon economy, as claimed by some of those in favour, but an excuse for world political leaders to delay further the actions that are already overdue, to go green.

So, that's almost half the course completed and it's going too quickly!  Watch this blog for my next update.

Shale Gas & Fracking - Week 1

I have commenced the Shale Gas & Fracking: the Politics and Science MOOC (Massive Open Online Course), delivered by The University of Nottingham for FutureLearn.  Shale gas is a hot topic in the news right now and I felt this course would be an ideal follow-on to the Climate Change MOOC that I completed last year.  I will be interested to see if the knowledge that I gain from the course will change any of my views on fracking.  At the moment, I strongly believe that fracking is perpetuating the combustion of fossil fuels and therefore, exacerbating global warming and climate change.  In my opinion, the effort and resources directed towards fracking could be better spent developing green energy, for which the technology is available but frankly, the political will seems to be lacking.  So that's what I feel now!  It will be interesting to see the views that I express in my Week 4 blog post at the conclusion of the course.

This week I have learnt about the geology of shale gas, how it is extracted by hydraulic fracturing (fracking), the story so far from the developments in the USA and the locations and resource estimates in the UK.  I have learnt that there is a big difference between what might be present (resource) and how much can be commercially extracted (reserve).  So far the UK is in the exploration stage for shale gas and oil and it is too early, therefore, to determine its commercial viability.

So that's the story of my course so far.  I'll keep you posted!

A Message to David Cameron

I am appalled at the government’s blasé attitude towards climate change.  Yesterday’s (26/1/15) Commons debate rejecting a bid to suspend fracking for shale gas, ignoring the Environment Audit Committee’s warning that there were “huge uncertainties” about the environmental impact of fracking, shows a complete disregard for the future of society by those who are entrusted to govern the country. Apart from the uncertainties relating to the impact of fracking on the environment, there is overwhelming evidence that the burning of fossil fuels is directly responsible for climate change, yet most UK politicians are clearly in denial mode.  Lord Hailsham was right when he described the UK government as an elective dictatorship.  No matter how strongly people feel about an issue that affects the whole of humanity for generations to come, the government of the day acts totally irresponsibly putting some short-term economic arguments before the future of the planet.  It’s disgraceful.

Drucker's Disciple

I made the career transition from engineering to management in the 1970s and it was, to put it mildly, a shock to my system.  Engineering is a highly respected profession and although the answers to all engineering problems are not known, the questions that have to be asked to establish solutions, can usually be formulated.  Management, on the other hand, is not an applied science.  It is an attempt to control complex organisational systems usually, although most managers would not admit to it, by employing trial-and-error problem solving and asking the right questions is not easy.  As a young engineer I could always consult a senior or principal engineer if I needed assistance and usually their help and guidance were invaluable.  As a young manager, it was more difficult to seek help, pride had something to do with it but also, I found the opinions of more senior managers often were no better than my own.  That might sound arrogant, but for complex business decisions, there are not always precedents against which others can provide useful guidance.

What about management consultants, business schools and respected gurus, how can they help?  Well in a previous post, 'Business School Crap', I was a bit disparaging about some of the outputs of business schools and maybe I went over the top!  I do believe, however, that attempts to apply simple models and tools to complex business problems can be dangerous.  Less scrupulous, or perhaps naive, consultants sometimes cherry-pick the outputs of business schools and offer quick-fix solutions to ailing businesses.  There are, however, respected management practitioners and that leads me to world-class gurus and my long-held admiration for Peter Drucker.  I first started reading his works in the mid 1970s and I was impressed by both his extreme intellect and impressive foresight.  Maybe to call me a Drucker's Disciple is a bit presumptuous, but he certainly had a major influence on my management career.  Here is just a handful of his quotes that I like:

"A manager is responsible for the application and performance of knowledge."

"If you want something new, you have to stop doing something old."

"There is nothing quite so useless, as doing with great efficiency, something that should not be done at all."

"Results are obtained by exploiting opportunities, not by solving problems."

They are all simple statements and I could quote many more, which for me are extremely thought-provoking.  As an example, I will explain how thought processes might develop around the last quote on the need to exploit opportunities, rather than solving problems.  I recall the years when I had a rather dashing, but old, bright yellow Triumph Spitfire sports car.  I could barely afford to buy it and I certainly found it difficult to meet the running costs, unless I did my own car maintenance.  I could tackle most car repair work but I loathed doing it.  The universal joints (UJs) on the rear half shafts, seemed to need replacing far too often.  On one occasion whilst lying under the car, covered in oil and grease, replacing a UJ, I recalled Peter Drucker's quote - "Results are obtained by exploiting opportunities, not by solving problems."  There I was solving a problem, one knackered UJ, whilst denying myself an opportunity of showing off my bright yellow bobby-dazzler and exploring pastures new!  Yes, problems need to be solved to return a system to 'normality' but the primary focus of attention should be on new opportunities not old problems.  That's a good lesson for anyone running a business, where, from my experience, managers very often put the emphasis on internal operational problem solving, rather than external exploitation of market opportunities.

There might be many disciples but there was only one Peter Drucker :-)

Strategy vs Culture - No Contest

"Culture eats strategy for breakfast."  Those were fine words from Peter Drucker and are confirmed from my own experiences, which I will touch on later.  What is an organisation's culture?  Well, simply put, 'it's the way we do things around here'.  I like that definition, it's short, succinct and I'm sure we can all relate to it.  Let me give you an analogy, which I also love.  My wife and I are UK nationals living in Turkey - yes, the dreaded 'expats'!  We have a very large garden, which we both look after and my wife is extremely green-fingered and loves gardening.  On the other hand, my forté is lawn-cutting and general maintenance.  So we're a good team!  That said, there is always a danger to try to create an English country garden in a Mediterranean environment and it doesn't work.  The climatic environment is analogous to business culture - 'it's the way nature does things around here'.  Some things will thrive.  Some things will just survive.  Some things will die.  As an example of the latter category, we have our failed attempt to grow a willow tree!  In the business environment, strategy (planting the 'business trees') has to compatible with the business culture (the prevailing 'climate'), otherwise, like our willow tree in Turkey, it will get eaten for breakfast!  I will mention no company names but here are two examples from my own career.

I worked for a large multi-national corporation, which was a hard task master, highly integrated and entrepreneurial and real fun to work for.  It was acquired by an even larger company, which was a cash rich conglomerate, risk averse and extremely dull and boring from a young high flyer's perspective.  There was certainly a good synergistic fit in terms of technology and markets, but a real clash of cultures.  The acquirer's culture not surprisingly dominated in the newly consummated relationship, but much of the top talent from the acquired company soon moved on and gradually the added-value of the 'marriage' was lost.

The other example was when I became the managing director of a well-established, medium-sized engineering company, highly respected by its customers for value, quality, responsiveness and support of its sophisticated products and services.  But it had a high market share of a niche sector within a gradually declining market, so from its rapid growth in its early formative years, it was now suffering from a flat to declining sales profile.  I spearheaded a strategy of moving the company into pastures new, whilst not neglecting its existing markets.  It was a case of establishing current technology into new markets, i.e. the classic market development strategy.  Strategically it made sense but it was hampered, although fortunately not defeated, by culture.  The company's existing customers were a good cultural fit with the organisation - risk averse and highly procedural.  The new customers were very different.  They came from fast-moving new industries where the priority was on getting the job done and worrying about the contractual issues later!  Ultimately the new strategic direction did turn out well for the company but it took much longer than originally anticipated.

So what are the lessons learnt from my experiences and numerous other case studies?  Well, there is an interesting piece in 'Strategy Bites Back', in a chapter by Karl Weick, under the heading 'Strategy is Culture is Strategy'.  He suggests that there is a common set of issues in organisations that some choose to call culture and others choose to call strategy.  Having considered my experiences as well as the case studies, I am now firmly of the opinion that culture is an emergent property of a highly complex organisational system and is usually deeply-rooted, i.e. difficult to change.  Strategy, or more specifically a strategic plan, contains goals that haven't been achieved but exist as aspirations.  So we have a deeply-rooted culture that firmly exists, coming together with strategic aspirations that have yet to be realised.  Well, that says it all doesn't it?  They just better be compatible with each other, otherwise as sure as eggs are eggs........

"Culture eats strategy for breakfast."

!!!!

  

Armchair Activist

In many countries, such as the UK, there appears to be a growing disillusionment with politicians and the political process.  Much of the problem is as a result of a lack of trust in politicians and a perception that they are more interested in their own agendas rather than the issues affecting the people who they represent.  There are also two key factors that impact on the effectiveness of national democracies, namely the limits of geographic jurisdiction and the timescales of the tenure of elected government posts.

Here are two examples of issues affecting all inhabitants of this planet where, in my opinion, national governments are almost powerless.  Distribution of wealth is a major issue.  The rich are getting richer and the poor are getting poorer.  If, for example, a national government decides to introduce a wealth tax to try to address this problem, those affected could simply transfer their wealth to more 'wealth friendly' countries - hence the existence of tax havens.  So the geographic jurisdiction of national governments affects their ability to tackle a major inequality in society.  The second example is climate change.  Clearly individual countries can reduce their emissions of carbon dioxide.  But as we all know, effective remedial action for climate change will take many years and a lot longer than the duration of any democratically elected government.  So what incentive is there for any government to spend money trying to tackle climate change when there are no immediate benefits?  From a politician's point of view, time, effort and money would be better spent on activities that would help his or her re-election.

So the disillusionment in politics coupled with the growth in social media, has led to more and more people communicating their concerns on the Internet - Armchair Activists.  As well as obvious platforms like Twitter and Facebook there are sites dedicated to fighting popular causes, like Avaaz, 38 degrees and Change.org.  So starting a petition or signing an existing petition with millions of others has never been easier.  Does this mean that direct action, like street rallies, is going to become a thing of the past?  I don't think so and indeed, I see exciting new ways of democratically and peacefully bringing about change.

People might be becoming more disillusioned with politics but that doesn't mean there is apathy towards important issues affecting society at international, national and local levels.  Yesterday, I joined a rally at our local beach, which has recently and controversially had its management transferred from the local council to a private company.  You might wonder what's wrong with that particularly when outsourcing of many services is employed by national governments to improve efficiency.  I accept outsourcing can be beneficial in some cases, particularly where there are 'economies of scale'.  However, in this particular case, the idyllic beach in South West Turkey, is renowned for being one of the most important breeding areas for loggerhead turtles.  It is unspoilt and the fear is that privatisation could eventually lead to environmental damage to one of the few remaining untouched coastal areas in the region.  Private companies are, after all, concerned with maximising the returns on their shareholders' investments, which means looking for ways to increase revenues whilst reducing operating costs.  I don't think I need to describe any nightmare scenarios that might come about.  Just take a look at what's happened to many idyllic spots in Turkey and the Mediterranean countries where uncontrolled development for tourism has been allowed.  The rally that I attended was held at the end of a 24/7 occupation of the beach by activists, which has been called off following a court order suspending the private company's take over of the site.

Clearly this issue has not yet been finally resolved to the satisfaction of the activists but it is a good example of how Armchair Activism has worked hand-in-hand with the front-line protesters.  Apart from the use of Twitter and Facebook for communication, a petition has been launched on Avaaz, which has drawn in local, national and international support.  I would suggest that none of the progress made thus far would have been possible if it had been left to the local political machine.  So maybe we are seeing the evolution of a new form of democracy.

Power to the People!

Changing Your Mental Models

The best description of mental models that I've come across, comes from The Fifth Discipline by Peter Senge:

"Mental models are deeply ingrained assumptions, generalisations, or even pictures or images that influence how we understand the world and how we take action.  Very often we are not consciously aware of our mental models or the effects they have on our behaviour."

So mental models are the 'spectacles' that shape our view of the situations that we encounter in our day-to-day experiences of life.  Mental models provide an explanation as to why different people can view the same situation in completely different ways and why the well-worn expression "perception is reality" is pertinent.  For example, a family wakes up on a winter's morning to see a thick blanket of snow everywhere from an unexpected overnight snowstorm.  Dad might suffer from panic thinking about how he has to clear the snow from the driveway to get his car out of the garage, the anticipated slow journey to the railway station and the possible disruption on the railways affecting his journey to work.  The kids, on the other hand, will treat the conditions with happiness, hoping that their school will be closed, but whatever, they will spend as much time as possible tobogganing and generally messing about in the wintry paradise.  There are two completely different views of the same situation based on individualistic mental models.

Is it possible to change mental models?  Well in the previous example, it is quite possible that when the kids reach adulthood they might have the same pressures as their father and so a wintry, snowy morning could turn from excitement to a hindrance, but very often models don't change easily.  Here's a real example from my own life.  I have always pictured the months of the year positioned around a clock face.  After all, there are twelve hours on a clock face and twelve months in a year, so it's a good fit, isn't it?  You would expect 1 o'clock to be January, 2 o'clock to be February........11 o'clock to be November, 12 o'clock to be December.  However, my mental model of the months of the year is different from the expected.  12 o'clock is January, 6 o'clock is August.  February through to July are evenly spaced between 2 o'clock to 5 o'clock.  September through to December are evenly spaced between 7 o'clock and 11 o'clock.  I believe my adoption of this model dates back to my early years at primary school and because I know it is an illogical model, I have tried to change it.  I even produced a sketch of a clock face with the months of the year in their correct positions - January 1, February 2, etc - and placed it on my desk so I would look at it everyday, but it hasn't worked!  The old model keeps coming back in my mind.  I think there might be a 'rationale' for the origins of my model.  There are three school terms - September to December, January to March, April to July.  The hottest month in the UK where I went to school, is August.  The coldest month is January.  So the hottest month is 'due South' on the clock face and the coldest month is 'due North'.  It is a shorter journey on the clock from summer to winter, than from winter to summer, which probably reflects how the passage of time felt to me in my youth.  So there we have it, a mental model that certainly doesn't make sense to me now, even if it did when I was a child, but I can't seem to change it easily.

What worries me about my personal experiment is that whereas that particular mental model is harmless, because it doesn't affect my relationship with others, there are many mental models that we all have, which when in conflict with others, can be harmful.  Religious and political views are two obvious examples.  The resolutions of conflicts affecting society depend on changing mental models. Let's take the example of climate change.  There are those who believe mankind's emission of carbon dioxide is producing global warming and therefore climate change.  There are others who do not believe that is the case.  I happen to be in the former category and I have a mental model against which I judge any arguments that are given for and against my view of what we're doing wrong.  It's no surprise that I have not been swayed by any climate change deniers.

So how do we make progress when we all have different 'pictures' of reality?  Maybe a first step is to recognise that we all have different realities and therefore we have a mental database of opinions, but not facts.  If our opinion is at odds with someone else's opinion then we should explore ways to gain consensus, but realise that to achieve a 'hearts and minds' consensus, mental models have to change.  There is no point reluctantly agreeing.

Finally and returning to my clock of the months of the year, I have accepted the premise that my current model doesn't make sense even though I am experiencing difficulty changing it, but I will keep trying.  That said, I am in good company because in the words of Albert Einstein:

"To break a mental model is harder than splitting an atom."

No wonder it's difficult!