Rob Brown: Systems Thinking in a Complex Organisation

Rob Brown from Aviva is up next.  They started in 2008 with Barry Wrighton from Vanguard (also involved with BNP Paribas Fortis).  He’s currently the Lead for Systems Thinking but looks forward to the day when his role is obsolete.

Some of Rob’s learning are that Senior Management engagement is crucial. They have gone at the pace of the leader’s understanding.  In the Policyholder contact area they have no targets but have gone from 50 – 92% customer satisfaction in 6 months with a ‘clean audit’ with no issues.  The pace has been driven by the correct leadership engagements at all levels.  It took them several years for general insurance to start with their journey, but it is down to people decided when they want to start.  They decided to ‘see what would happen if they tried’.

Phrases from Senior Leaders to watch out for when introducing Systems Thinking

If he had his time again, the killer phrases he would look out for are:

• When a leader says “I’ll delegate that to …” because they will be a blocker to redesign.  Where it has happened it didn’t work.
• “What targets do we use?”. Senior managers, not in the work, want to set a ‘stretch target’ to get ‘better Systems Thinking’
• “I get it!” when a leader says this, it usually is followed up with a question that shows they don’t. You have to get past the ego to get onto the work.  We have worked without/despite leaders but it has been hard.  They need to hold a mirror up to say “we need to do this in your area” in order to have dramatic further progress.
• “Why can’t you go faster?”. Even though other projects have produced no benefits but were delivered to date/time targets, people still find Systems Thinking hard to understand.

Budgets, Plans, Risks & Regulation, Audit

It was important for them to work with the audit team so that they understood the new process.  Legal, Compliance and Risk said they felt they were labelled “Level 3″ waste (incorrectly). It’s been much better to work together with them so that they develop an understanding.

Observations from Check

There were 500+ numbers customers could use to ring in, with 48 Integrated Voice Response systems (IVR) with call centres for different product silos.  16% of all calls were transferred (which would happen given the IVRs). Customers were on hold for a quarter of the call (a single loop fix was to ‘choose better music for customers on hold’!). 15% were passed-back, 42% passed on.  Then there was the split as the call went into a back office system. Typically customers called in 3 or 4 times for a single piece of work! Yet, all of this was happening while we were ‘green’ on budgets and targets. But 50% of the time we were not giving customers what they want. By looking at the work differently, after re-design, they were able to turn off off-shoring and achieve 92% value demand.

Summary

There has been a move from intervention support to a focus on leadership and embedding behaviours.  To fully embed Systems Thinking they need much more work at all levels.

Question and Answers (with Benny Devos)

Benny on Emotional Intelligence and Systems Thinking:

People have to be open. The management used to ask people to take their brains out of their heads as they arrived at work, only to put them in when they left the building. The manager needs to understand what the customer wants as well as his team. Therefore, you need empathy. Also, the manager has to change personally.  The leader needs to help the team become leaders themselves. You need EI to detect how other people are thinking.

People change is often thought of as being a HR function. How has HR been?

Rob: We’ve learnt some lesson. When changing roles and remuneration, HR didn’t get it. What we should have done was take them through the work much more before that point. We are part of a global company and I can’t switch off the remuneration.  What we have done is given Systems Thinkers to remunerate as they see fit.  We have a new HR Director and understands that HR needs to understand how they can help if Systems Thinking is going to be extended. HR knows they don’t need to ‘do culture’.  We had employee forums who felt threatened, so we took them in and allowed them to see and understand themselves.

Benny: HR people were in the intervention from the beginning.  What we saw was that if you needed a decision you had to re-explain what it is all about. If you put enough energy in then they accept it and it changes. But this is counter-productive and wasteful because the solution takes a long time. In terms of the workers council, in Belgium, you had to go to a council every time. They were skeptical, given the McKinsey experience, so we explained and invited them to the work floor. We invited them and involved them and they understood.

Seddon: A lot of HR is dealing with symptoms of traditional Command and Control design. When you change the system, many HR symptoms go away.

Would Systems Thinking have prevented Sub-prime in the Banking arena?

Rob: If you understand the controls, and they are part of the work, and specialties help design it, it is much better control than the ‘remote sign-offs’ that most businesses used.  Sign-offs are fine until something happens, but with Systems Thinking the right people are involved at the right time, so it’s a stronger sense of control.

Benny: Don’t repair – put right the first time.  Top managers don’t have any understanding of what they are signing off – it doesn’t make sense.

Seddon: The regulators played a part. Regulation is a catch-up. They assume it applies to all products. They should make it a preventative thing. You shouldn’t be able to launch a financial product without showing what it would do. Politicians also thought that finance would drive growth. Some economists think that financial servers should help the economy, not be an economy in its own right.

“We’ve also done it this way, it’s how it works … it’s how it’s regulated”. Is there any one thing you’ve done that helps managers avoid this? where do you start in terms of getting people to think in a different way:

Rob: Get the right people to look at what’s happening in the work differently. You can’t have a debate about ‘what’s the better method’ – focus on getting people to see what’s going wrong and allow that to drive what should be done differently. Leaders should look at their world differently. Don’t do it at tables in offices.

Seddon: It’s an intervention problem. Man is not rational. It is not I explain, you understand. It just creates conflict with two mindsets using different language. If you put them in a normative experience then together they develop, building a common understanding, and that helps the change.

Benny: It’s a common understanding, and it’s not the managers that are doing the redesign, it is the workers. They do trial and error and demonstrated that it’s not normative. The managers were focussed on the measures, not how the work is done. We focussed on ‘positive’ people and worked with them. We gave managers an ‘Informed Choice’ some managers wanted to join early.  They were only rolled in if they wanted to.  Those who decided not to, went to different areas.

Seddon: Roll-in is a deliberate phrase we use instead of ‘roll-out’. Now that we have understanding, how do we ‘roll people in’. We need people to see the relationship between assumptions and policies, which requires normative experience.  You might think this will take longer – but try doing the wrong thing, it will never happen!

Another question on Emotional Intelligence. In the examples there were less workers, was this a threat to the rest of the workforce?

Rob: We had a cost-reduction promise hanging over us, which is tricky. We faced up to this fact and had discussion about the fact it would happen, but we would do it from a ‘where’s the value’. It was tough. We told the frontline that they were sacrosanct because they understood the demand.  People work out that you may not need as many people, but there are lots of other places they could go in the organisation to add value.

Benny: The biggest problem was getting people to believe that we weren’t threatening jobs (there was no budget or cuts over our heads). People didn’t believe me; it took time, energy, talk and waste from my point of view to convince them. It’s a normative experience; they find out themselves.

Seddon: Systems Thinking in the private sector is about driving growth.  We provide a framework, so if you have to take people out, it helps make sensible decisions about where to take people out.  We tend to always find too many people in the “management factory” (which Seddon admitted was pejorative)?