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November 25, 2005

Optimization, Technique, and the Function of Form

At any given time, "performance" is dependent on execution and it assumes that execution will maximally realize a certain underlying functional design (unless prevented!).

This also dictates a basic truth about performance improvement: if performance is still predicated on a design that has not changed, performance improvement cannot exceed the maximum potential of the execution to realize the design. Improvement beyond that point must be based on the introduction of a superior design.

Ironically, a superior design can produce performance greater than an inferior design even when the execution of the superior design is not as great as the execution of the inferior one. In most forms of organized endeavor, this is the phenomenon of technique. Imagine yourself on the tennis court, where a player with good technique executing only moderately well to intentions will handily beat another player doing quite well at executing poor technique.

The triumph of form over execution is how we know that "optimization" belongs in the realm of execution but may not even be critical to performance improvement. Optimization improves execution by eliminating errors or waste in execution's compliance to the demands of the design. But the issue is that improved execution may not actually improve performance because it can pass the point of diminishing returns and because it does not correct flaws in the design itself.

The "returns" we're looking for are, specifically, the influences of the design on the conditions in which the execution occurs. For example, we may recognize that we want a fire and that we need a certain amount of heat to start a fire. The heat level for ignition is the design element. The execution is the steps we take to produce the heat. Not producing enough heat is poor execution and so poor execution depresses performance. But we might alternatively find a way to start a fire with less heat. This is not an execution change but instead a design change. The reasons why less heat can start a fire are not about how good we are at producing heat, but instead they are about how other conditions combined with heat lead to ignition. Continuous performance improvement would be represented by finding ways to increasingly lower the amount of heat needed for ignition, without introducing new counterbalancing deficiencies. Continuous execution improvement (optimization) would be represented by greater and greater ability to generate just the amount of heat necessary -- something that might even become obsolete if the design for ignition changes.

A designed form is a relationship of components in which the relationships, not the components, do the work of generating the necessary effects. In getting the three-legged stool to stand up, it's not the quality of the third leg that makes the significant difference, it's the relationship of the third leg to the other two that makes the significant difference.

In the June 2005 paper, "Systems Thinking and Performance Improvement", our colleague Olivia S. Herriford, D.M., president of Herriford Consulting, describes the need to rethink management of organizations along the lines distinguishing performance, execution, and the criticality of organizational form. Below, (copyright 2005, Olivia Herriford), Herriford herself discusses the issues.

Systems Thinking and Performance Improvement
Traditional thought regarding organizational performance improvement makes the assumption that the approach is the same for individuals and organizations – that enterprise-wide excellence is simply a matter of scale. If we improve the productivity and effectiveness of people and small teams, we can impact the larger entity by making sure our programs, training, and interventions cover all the bases at all levels. According to Robert Carlton (2005), a leader in the field of Human Performance Technology (HPT), performance improvement practitioners have perpetuated this linear, mechanistic view of organizational effectiveness by focusing on isolated elements of performance – people, jobs, and job groups (processes) – as the means to the end.

The shortfall of this approach is that it has not had the impact on the organizational competence necessary to sustain continuous improvement and high performance. Organizational competence is the degree of versatility in which an organization can carry out its collective activities (O'Connor & Quinn, 2004). An organization’s capacity for leadership and high-performance is strongly related to the patterns of connectivity resident within the organization – the relative interrelatedness of its members. Connectivity creates the means by which members can work together to collectively address the tasks required to meet or exceed goals. To develop this competency requires a fundamental shift in thinking about performance. Systems thinking is at the core of this shift.

Traditional thinking about performance improvement takes a linear, operations research approach.

• Identify the component parts of the performance problem.
• Once the elements are identified, analyze and explain what is occurring at each step of the performance being investigated.
• Take the various pieces that have been identified and analyzed and explain the problem and the solution.

Carlton reminds us that this approach is flawed in having long-term impact because it completely ignores the consequences of the organization’s behavior as a living system. When each part of a system, considered separately, is made to operate as efficiently as possible, the system will not operate as efficiently as possible. A system is a thing that must be dealt with as a whole, not its parts. It cannot be divided into independent parts and each part analyzed. It is a single entity and every part has properties that it loses when they are separated from the system. Therefore, it follows that when we take the approach to performance improvement outlined above, we are eliminating from our analysis the most critical aspects of the problem or opportunity – its systemic nature and its connectivity to everything else around it.

An organization has overall properties that none of its parts have which are its most essential elements. These elements are its competencies and they can not be developed or improved one part at a time without diminishing their capacities. In other words, maximizing the effectiveness of a single department as a separate and distinct project is actually detrimental to the total performance of the organization. Today’s complex situations and challenges call for tasks to be the shared responsibility of many people across multiple groups. Organizations must shift from exclusive reliance on individuals and teams toward a more inclusive focus on connections between these entities.

Making the shift requires synthesis instead of analysis as the initial process of improving performance. The steps of synthesis are:

• Identifying the containing whole of which the component in question is a part
• Explaining the behavior or properties of the containing whole
• Explaining the behavior or properties of the component in terms of its interdependencies within its containing whole.

Synthesis defines the connectivity that a component – an individual, a team, a job, or a process – has within the system. For example if we are concerned with managerial performance improvement, we must first identify and then define the system of interactions that comprise the inputs, processes, feedback, and outcomes of managerial performance. Finally, we describe how management behaves in relation to these stimuli and expectations. Going through this process keeps our efforts in alignment with the encompassing system because they are better informed and cognizant of the impacted relationships.

Taking the systems approach to performance improvement is effective and sustainable because it goes beyond individuals to collectives – interdependencies between individuals, between functions within the organization, between the organization and its external stakeholders (i.e. customers, partners and communities). Over time, systems thinking becomes imbedded in the culture because synthesis and a heightened awareness of organizational interdependencies creates and engages shared meaning – probably the most critical of an organization’s competencies and certainly the one reason why it thrives as a continuously effective and sustaining system.

Carlton, J. R. (2005). HPT: Focused on individuals or focused on the enterprise. Performance Improvement, 44(3), 5-11.
O'Connor, P. M. G., & Quinn, L. (2004). Organizational capacity for leadership. In C. D. McCauley & E. Van Velsor (Eds.), The center for creative leadership handbook of leadership development.San Francisco: Jossey-Bass.

Posted by Malcolm Ryder at November 25, 2005 3:19 PM

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