Turning Business Problems Inside Out

Turning business problems inside out

Businesses invite consultants to solve problems when their own attempts fail. Legacy problems come with legacy attitudes and human hearts.

By Paul Price.

Two weeks ago, I’d left private practice, a freshly minted ACA. Qualified. Two minutes ago, I’d hit Send, completing my first monthly management reporting cycle. Baptised. It was 1988. H.O. was happy, I was happy. What next?

I reached for the weighty file that a fortnight earlier my new manager had handed to me along with my bread and butter reporting duties. Materials Flow Project, the cover-sticker read. This beast, a lever arch, choked on seven years’ worth of fruitless attempts to solve a company-wide materials flow and inventory management problem. Its sabre teeth gaped with copious memos and minutes that meticulously documented innumerable meetings between the various department heads who were embroiled in the matter, meetings that had been chaired by ‘Accounts’. (Such were the days before e-mails, intranets and other disruptions). Half way through the file, I abandoned it. I saw in it my passport to gain valuable knowledge-of-business, and went on walk-about.

In the warehouse, I met Tommy. Tommy was neither supervisor nor manager but knew the business back to front. Tommy was also an avid cyclist. And I just happened to be a bike racer. Electing himself as my informal ambassador, he led me through processes, through warehouses and factory floor, through both sales departments, introducing me to all the key players as we went. Finally, we reached the sales administration office where I shared a joke with the man who would ultimately champion the successful conclusion of this seven-year-old problem.

The solution took but a few months to devise, chart and implement. Involved few memos and pretty much no committees. Rather it parked me at the edge of various peoples’ desks where I brokered the interdepartmental physical, process and systems changes that were required. None of the ideas were new. None of them were mine, nor did I attempt to own them. Only towards the end, when everything was tested and functioning, did the changes get kicked up to the department heads and past their personalities for sign-off. And that was that (pretty much).

First address the human

That early win taught me a valuable lesson, a lesson that has informed my approach to business challenges ever since, a lesson that my later studies would corroborate: all business problems are human problems. As Nobel laureate, Daniel Kahneman (2011), tells us in his bestselling book, Thinking, Fast and Slow, we humans, while we are rational, are firstly emotional.

I firmly believe that had I taken that same file into my hands six months later than I had, the outcome would have been much different. By then, I would have become part of the problem, part of the politics, another constituent. My temporal passport would have expired. I would have lost that all-essential freshness, that inside-outsider attitude that my newness to the company afforded me then. The same newness that we consultants can bring.

Organizations engage consultants when they need help to solve their problems. There is need for change, but what change? We are briefed by management. Read through documents. We probably have a solution already in mind by the time we sit down with the team, but we should contain it. When we approach change from the outside in, we evoke not only hope but also fear. We need be aware of such anxieties if we are to be the right consultant. We need to understand those anxieties and to deal with such issues before anything else.

Despite our experience and our expertise, we are agents. All legacy systems, legacy structures, indeed all legacy problems come with their own unique legacy attitudes. To succeed, we need not act but rather to catalyse the agency within others inside the organization and so empower them to act. We approach from the outside in but our solution builds from the inside out.

Change, while rational, is firstly emotional. We humans cling to what we know even when what we know no longer serves us, because what we know is better than the alternative: not knowing. The first step of any successful change process is to encompass the Not Knowing. Steven D’Souza (2016) speaks of this in his book of the same name.

Change, and the unconscious life of groups

Many years before not-knowing was a thing, Wilfred Bion studied this frustrating phenomenon. He recognised that we both want to learn and want not to learn.  Working with groups within the army during WWII then later at the Tavistock Clinic, Bion (1961) identified that in the face of change working groups adopt two opposing tendencies which he called: work-group mentality and basic assumption mentality. The first of these is the desired conscious executive mindset, the one that faces reality, establishes goals and acts to achieve them; the one that we, as change agents, aim to harness. The second, and likely the one that we might first meet in core groups, is emotional and often unconscious. Frustrated by not-knowing, people oppose reality by postponing, rejecting, or avoiding it altogether (as the colleagues in my example had done for seven years).

Groups swayed by basic assumption mentality lose critical individuality. Bion’s work describes three basic assumptions:

• dependency: without mutuality, the group (team, department, division, etc.) unconsciously selects one person to fulfil their needs and so shirks the shared responsibility;
• fight/flight: the group unites against a common foe, often, but not always, an obvious enemy – the requesters of change;
• pairing: the group adopts a sense of messianic hope, an ostrich mentality that clings to the status quo.

Basic assumption groups avoid taking meaningful decisions, or take decisions hastily, without due regard for their effectiveness or consequences. They evade ownership by unconsciously delegating accountability upwards or outwards to management, who are not in the room, or to the consultant, who is; or they ignore it altogether.

Legacies do not happen, they are caused

As business leaders, sometimes we structure around people problems then people around structure problems. We promote people to recognize what they’ve done, not what they can do. Under stress, we often intuit; we take executive actions without the full facts. These actions mount up and their effects become part of the norm. As a manager, in industry, I’ve done it myself. Nowadays, as an executive coach and consultant, I see clients contending with the same issues. One failed fix-it follows the next. Systems’ bottlenecks become socialized and thus galvanized. There, you have it: a legacy. The longer the problem continues, the more we habituate to the pain. Rational outside-in attempts to address these problems tend to fail because of misunderstanding the emotions and the history behind them. The basic assumptions.

Irrational as it may seem, we tend to defend our symptoms. We do it as business leaders too. It’s unconscious. Solutions, while they must be practical, need also to be psycho-social. We need to think both fast and slow to harness attitudes and relationships if our efforts to change are to succeed. Only by turning problems inside out, by getting to the conscious and unconscious human heart of them, can effective change occur. It follows that establishing operand ownership at the early analysis stage of any new change project is essential to empower internal changemakers and so achieve effective engagement.

But that’s buy-in; and we know about buy-in, so what’s new?

Lean-in then expect buy-in

Buy-in is rational. People are often not. And the change-projects that we engage in as consultants are most likely not a first attempt. To achieve buy-in, we must ease ourselves into the issues so to arrive at a point of rationality, but not to assume one. In our early encounters with relevant working groups, we should avoid being the expert and for a measured time share the not-knowing; listening, observing. During that time, we need be emotionally agile so to pick up on sub-context, to recognise the defences that may be present, the basic assumptions. We do this by listening not only with our ears but with our eyes and with our experience, our presence. We listen for the issues beneath the manifest problem, for the human PULSE:

• Politics: what informal powers are at play?
• Utility: how are the changes deemed to serve or disserve the group; the task internalized by the group may differ to that perceived by leadership?
• Loyalties: are the changes likely to impact on peoples’ employment, livelihood?
• Self Esteem: are the changes to effect reporting lines, seniorities, tacit knowledge values?

The bottom-line

Businesses, like all living things, are open systems. They are constantly being affected by what’s outside. They need to be because they exist to serve what’s outside. When problems inside effect that service, they need to be healed, but not from the outside in dealing only with the symptoms. At the heart of every business problem there is a human heart. Only by listening to it, by harnessing its passion and thus by re-empowering it, can the alignment that is so necessary to solve those problems be achieved.

By: Paul Price, MSc, FCA is an executive coach and business consultant at dynamicconnections.ie   

Published in Accountancy Ireland Magazine, June, 2017