Victor – Page 31 – Noise Between Stations

SarbOx flawed, but fixable

James Surowiecki’s Sarboxed In?…

The Sarbanes-Oxley Act was a political knee-jerk even the Republicans couldn’t avoid, in reaction to Enron, Worldcom, etc.
The complexity of the new rules went too far, requiring six figure enforcement costs, and possibly hindering small companies from going public. There are now talks of easing enforcement or modifying the Act.
But the problem SarbOx addresses is very real: to fake earnings and revenue, companies made acquisitions and hires they didn’t need. Two researchers estimate that companies who restated financials fired between two hundred and fifty thousand and six hundred thousand people between 2000 and 2002, slashing payrolls by more than twenty-five per cent, while other companies cut them by just 1.5 per cent.

Improvements in products, process, and culture can reinforce each other over time

products, process, and culture reinforce each other over time

Improvements in products, process, and culture can reinforce each other over time.

Great products can have a revitilizing effect on a company’s culture. But companies with poor cultures have trouble making great products.

Developing great products relies on an effective process. Cultures that acknowledge the need for process will make better products. But we’re not taught process, so usually we focus on the more tangible products.

Culture can make certain kinds of products and processes possible, but culture is hard to change directly; often it changes through the context of adopting new processes and products.

One approach is to focus on product but introduce process in order for both to change the culture over time.

Katzenbach and Smith’s team guidelines

Since I’ve been working on how to structure teams to do innovation work, I thought it would be a good time to revisit the basics in the form of The Wisdom of Teams by Jon Katzenbach and Douglas Smith. One point they make is to differentiate between “performing teams” structured in a mindful way and other groups of people merely working together. A performing team has certain characteristics…

It is small in number
The members have complementary skills
They are all working towards a commonly identified purpose
They have group performance goals, in addition to individual goals
They have a common approach to working together
They hold themselves mutually accountable, not just individually.

In the book and article The Discipline of Teams, they identify three kinds of teams:

those that recommend things — task forces or project groups
those that make or do things — manufacturing, operations, or marketing groups
those that run things — groups that oversee some significant functional activity.

For managers, the key is knowing where in the organization these teams should be encouraged.

Tools for Thought

I just discovered Howard Rheingold’s Tools for Thought is online. It’s usefulness should be obvious from his introduction…

Tools for Thought is an exercise in retrospective futurism; that is, I wrote it in the early 1980s, attempting to look at what the mid 1990s would be like. My odyssey started when I discovered Xerox PARC and Doug Engelbart and realized that all the journalists who had descended upon Silicon Valley were missing the real story. Yes, the tales of teenagers inventing new industries in their garages were good stories. But the idea of the personal computer did not spring full-blown from the mind of Steve Jobs. Indeed, the idea that people could use computers to amplify thought and communication, as tools for intellectual work and social activity, was not an invention of the mainstream computer industry nor orthodox computer science, nor even homebrew computerists. If it wasn’t for people like J.C.R. Licklider, Doug Engelbart, Bob Taylor, Alan Kay, it wouldn’t have happened. But their work was rooted in older, equally eccentric, equally visionary, work, so I went back to piece together how Boole and Babbage and Turing and von Neumann — especially von Neumann – created the foundations that the later toolbuilders stood upon to create the future we live in today. You can’t understand where mind-amplifying technology is going unless you understand where it came from.

Share a home-cooked meal

Joel Spolsky’s Fog Creek Software created a documentary DVD of the summer interns’ experience creating an actual software product. Notice how they cook and share a meal together. I’m a big fan of establishing a relationship over home-cooked meals. Last winter I met the guys from Zago Design for the first time in one of their homes over a meal. We ate delicious food and talked for hours, and by the end I wanted to partner with them more than other firms I’d known for years on a more superficial basis.

Artful Making

I watched State and Main recently. It’s a movie about making a movie, and hints at how that industry must blend the pure creativity of writing stories, the pure business of running a studio, and the combined creative/business endeavor of bringing together stories and studio to create a movie. I started to wonder if the collaboration and work styles found there was what business designers were trying to create.

I think business design can be much more, yet I think there’s a lot to learn from how people in film and theater run things.

I just discovered a book on this topic, called Artful Making: What Managers Need to Know About How Artists Work…

This book is the result of a multi-year collaboration between Harvard Business School professor Robert Austin and leading theatre director and playwright Lee Devin. Together, they demonstrate striking structural similarities between theatre artistry and production and today’s business projects — and show how collaborative artists have mastered the art of delivering innovation “on cue,” on immovable deadlines and budgets.

One Amazon reviewer compared it to agile programming. Another reviewer noted, “Concepts of rapid iteration, small groups and ‘playing’ …are not new.” Right, and that’s reassuring to me that we keep seeing these concepts applied in productive ways across several disciplines.

Labor and love

“Thereâ€™s a simple doctrine. Outside of a personâ€™s love the most sacred thing they can give is their labor. Labor is a very precious thing you have and any time you can combine labor and love youâ€™ve really made a match.” — James Carville

We’re trying to underdo the competition…

…No one can really beat us on the low end. It’s just what you need, and nothing you don’t. You’re always going to have more people on the low end who just need a few things.”

I love that Jason Fried quote, he’s proving out the worse if better argument.

One benefit he didn’t cite was disintermediating IT departments. I’ve seen this happen: IT departments spend months deciding whether to offer a service, evaluating packages, and designing a scalable offering. Meanwhile, individuals and teams simply sign up for a web-based service and get their jobs done.

A bakeoff of product innovation methods

Malcolm Gladwell’s The Bakeoff is now online, in which the food R&D firm Mattson tries to create the perfect cookie. Project Delta created three teams: one traditional in-house team, an “XP” (extreme programming) team of two people, and an “open source” dream team of the industry’s best working remotely. For anyone thinking about how to arrange people to create innovative products I’d say it’s a must read primer. With a couple caveats:

The “open source” and XP methods are for building products, not for inventing new ones. The article illustrates why they don’t work well for inventing new things. We need some vocabulary to distinguish between innovation teams and building teams.
Either the implementation of the methods or the description of them lacked key elements of what make them work. Open source is not simply an unstructured group of people contributing independent pieces. In Linux, for example, code is tested and reviewed by a central committee. And XP uses structured roles for programming vs. reviewing.

The explanation of getting team size right alone is worth reading the article for. Some expertise on the team is good, but too many people create friction in the process and impedes progress. Also see What Makes Teams Work?

MITD blog

The mysteriously authored MITD blog is harvesting a lot of interesting business+design links.

Designing organic milk

Kim Severson’s article on organic milk production and sales answered a few questions I had, namely

It’s the low supply, not the production costs, that are keeping the price high. I bet some qualitative research could influence this growth curve. For example, suppose it’s more educated parents who buy organic milk for their kids. Increase organic milk supplies to their geographic areas first and use the profits to increase production elsewhere.

There’s still so much confusion over the “organic” labeling, due to industry/government disagreements. Designers could do an end run and solve this through, for example, smart package design to educate the consumer, e.g.

Pasture fed
No artificial growth hormones
Local cows
Antibiotics for sick animals

Milk leads organic food sales because emotion plays a large role in this purchase, particularly for parents of babies. Again, this is another area that qualitative research can get the preferred organic products in people’s hands.

When is marketing not marketing?

For Sarah McLachlan’s World On Fire video, they spent almost the whole production budget solving the problems she’s writing about rather than producing the video.

When Boots pharmacy customers weren’t taking advantage of a service that transfers prescriptions directly from the doctor, Marketing firm Naked Communications stepped in: “Boots discontinued its TV spots and had employees suggest the service to customers waiting in line for prescriptions. According to Chris Laud, Boots’ media manager, the number of participants in the program has skyrocketed several hundred percent at a fraction of the cost of the TV campaign.”

In Douglass Rushkoff’s new book he writes, “When things are down, CEO’s look to consultants and marketers to rethink, re-brand or repackage whatever it is they are selling, when they should be getting back on the factory floor, into the stores, or out to the research labs where their product is actually made, sold, or conceived.â€

If this is a larger trend, I think it’s because marketing has made consumers either cynical or confused, or both. There’s still a role for marketing to play in a customer-centric marketplace, but it requires collaborating with engineering and design rather than putting lipstick on pigs.

More: How to spend your marketing and ad budget.

Who are the new rebels? (Managers?)

I live in one of the art centers of the world — the West Chelsea section of Manhattan — and my opinion of today’s art can be summed up in one word: boring. Rarely do contemporary artists teach us anything, or even make us feel anything. The best art only manages commentary, as with Banksy’s mockery of Israel’s separation wall.

I’m currently reading Rollo May’s 1975 classic The Courage to Create. As he explores the dangerous work artists created through the ages, I’m reminded of my research into Music and Censorship and this quote from George Bernard Shaw…

Whatever is contrary to established manners and customs is immoral… every advance in thought and conduct is by definition immoral until it has converted the majority. For this reason it is of the most enormous importance that immorality should be protected jealously against the attacks of those who have no standard except the standard of custom, and who regard any attack on custom – that is, on morals – as an attack on society, on religion, and on virtue.

It seems almost quaint to worry about music — or any artistic — censorship now. Artists no longer force us to question our customs. Does anyone else? In the West we no longer share the meta-narrative of the Bible, so religious plurality is old news. Science so routinely announces breakthroughs we’re rarely shocked.

Our shared customs now center around work. Could there be some action so radical it forced us all to reconsider our working lives? It’s described every month in the pages of Fast Company and Worthwhile, but what if there was a figurehead, an event, or a series of events that led to a tipping point to make these magazine proclomations reality? What if all the middle managers at GE demanded different conditions the way unions do? What if a visionary CEO committed to a completely transparent corporation with activist board members demanding triple bottom line performance? Could changes like this send employees home shocked into a different understanding of how to lead their lives? What sort of conditions could make this possible?

Balancing the heart and head is an old problem…

For the problem is simply how can warm passion and a cool sense of proportion be forged together in one and the same soul? Politics is made with the head, not with other parts of the body or soul. And yet devotion to politics, if it is not to be frivolous intellectual play but rather genuinely human conduct, can be born and nourished from passion alone. However, that firm taming of the soul, which distinguishes the passionate politician and differentiates him from the ‘sterilely excited’ and mere political dilettante, is possible only through habituation to detachment in every sense of the word. The ‘strength’ of a political ‘personality’ means, in the first place, the possession of these qualities of passion, responsibility, and proportion.

— Max Weber, Politics as a Vocation, 1918

The world is one baby girl richer

pregnant Christina My business partner Christina just gave birth to a beautiful baby girl. Congratulations to the new parents! You’re bound to have the smartest, geekiest, toughest kid on the block.