An Exploration of Modern Social Science Theories

1 Are we simply reactive beings or is there more? (McGregor, Ehin)

Douglas McGregor in his seminal work “The Human Side of Enterprise”(1960) polarised two extremes of how an organisation might view its staff.

• X Theory – where staff are viewed as inherently lazy, do not like work and have to be supervised and motivated. Staff needed to be “directed and controlled”
• Y theory – the recognition that work is a need, employees like work, and are willing to take responsibility. Staff require to be integrated and their self control enabled

His point was that if organisations viewed their staff as inherently lazy, that require to be supervised and motivated (X Theory) then they form hierarchical structures with methods that include supervision, performance management, incentives and appraisals. If however the organisation views its staff as liking work and willing to take responsibility very different management structures and methods arise.

His fundamental point is that the human race is more akin to his Y theory concepts. If we want to get the most out of our people we first need to believe in their intrinsic motivation driven by pride and willingness to take responsibility.

The company that stands out as a significant example of this type of thinking has been W L Gore, the makers of Gortex etc. In its field it is a highly successful and innovative company and is regularly voted the best company to work for.  Bill Gore established his company in 1958 around the thinking expressed by McGregor. His view was that:

“The Ferment in Management will continue until we find models that are more congruent with human nature”

Charles Ehin, Professor and former Dean of the Gore School of Management in his book “Unleashing Intellectual Capital” (2000) returns to a similar theme. He writes about innate human drives being a combination of self centred and other centred motivations. As the human brain has evolved it has moved from being purely self centred to have a strong influence of “other centred” motivations. The folowing table compares the two.

Ehin’s argument is that we are much more successful at unleashing the potential of people when the organisation leans more to the other centred attributes rather than the self centred attributes.

In fact we humans are much more complex and positive than the sceptical picture organisations and governments have of its people. We are so much more than reactive beings that simply respond to stimuli.

In conclusion, organisations to gain more from the spirit of its employees when they recognise the full capabilities of human beings.

2 Motivation  (McGregor, Herzberg, Kohn)

The answer to the question managers often ask – how do you motivate staff – is “You Don’t”

Douglas McGregor

If you want people to do a good job, give them a good job to do

Fredrick Herzberg

People come to work wanting to do a good job. It is the job environment that captures their intrinsic motivation. The job environment can also destroy motivation. Budgets, targets, incentives, appraisals all have a negative effect on motivation.

Alfie Kohn looks at the two components of motivation – intrinsic (driven by self esteem etc) and extrinsic (driven by external rewards and incentives)

He recognises the very powerful nature of intrinsic motivation. Extrinsic motivation he describes with the phrase “do this and you will get that.”

Alfie Kohn has carried out considerable research into incentive schemes. His overwhelming conclusion is that they do not work and do considerable damage. He gets quite emotional when he sees how pervasive incentive thinking is in the USA. He berates practitioners who do not concern themselves with research and the need to prove that it works. He has for years laid down a challenge for any organisation to prove that incentive schemes produce positive results. The qualification he puts on this challenge is that it should be in the long term and that the work should requires a degree of thought and initiative. 

The following are the problems with ‘reward thinking:’

• It encourages the individual to move his thinking from the task and onto the reward.
• It allows the manipulation of data to become commonplace
• As the focus moves from the task to the reward it cuts people’s interest in the real job.
• It thinks that the main cause of outcomes are the diligence of people not the system
• It accentuates the supervision vs. subordinate power relationship – and closes off open dialogue
• The misconception that it is possible to design a fair reward system.
• With time the subordinates gain control of the reward system
• It induces compliance and upward delegation and kills creativity. Breeds a dependency culture.
• It hides the real systemic issue for lack of motivation
• It discourages ambition and the setting of ambitious aims
• It gets in the way of getting to the real systemic problems and the real systemic opportunities for improvement.
• It is very prevalent in American organisational culture and was one of the reasons that Deming expressed the view that America should not export its style of management to friendly countries

3 Systems Thinking and Cooperation( Deming, Juran, Senge, Akoff, Checkland, Oshray, Carlisle  etc)

A system within an organisation can be described as the parts plus the connections between the parts.

Traditionally we have reduced problems into manageable parts on the assumption that if the parts are OK then the whole will be OK. An organisation has departments which are broken down into functions, which are further broken down to individual employees; and we manage the performance of individual employees. We call this practice “Reductionist Thinking”

We are now paying more attention to the recognition that the parts interact. There is the recognition that we have to manage the parts plus the interactions. (Systems Thinking)

There has been extensive research in this area of systems over the past decades and covers such areas as the flow of work, the subtle nature of the processes affecting flow of information, communication and the sharing of knowledge.

A strong message coming out of system thinking is that it is the design of the environment in which employees are working that is the primary determinant of the outcome. Joseph Juran argues that 85% of outcomes are a function of the system design; Deming considers the figure is nearer 97%. Senge uses the phrase “We are prisoners of the system”

Furthermore Peter Senge talks in terms of systems having ‘detail complexity’ and ‘dynamic complexity. He talks in terms of “seeing patterns.” At the Society in Sync conference in 2005 in Aberdeen he looked at how ‘crisis management’ often arose by the resources for long term projects being transferred to short term problems being caused by lack of resources in the long term project – and so. He further talks about delay. The effect of an action today might not become evident for 3 or 6 months, or even longer. Linking cause and effect therefore becomes extremely difficult.

If we could return to the principle message from systems thinkers. It is the design of the system that has the major contribution to outcomes (say 90%). The diligence of the individual has a much lesser influence (10%) on results

To go back to simpler systems – Deming, would portraying the structure of an organisation in terms of the flow of work (or system) rather than a hierarchical (or power) structure. Below is his organisation chart for a manufacturing company.

Note how both suppliers and consumers are part of the system. We talk in terms of whole system thinking.

This leads us onto consideration of the relationship between suppliers, the company and its customers. If they are all working in the one system, cooperation is fundamental. The whole system moves forward when all parties coordinate their thinking for the good of the whole – often referred to as Win-Win. As the whole system learns and develops, everybody wins.

Competitive tendering acts against the above aim of joint working. The major problems are:

• The actual working relationship between client and contractor is complex. It reflects convergent thinking (see below) to assume that this complex relationship can be written down in a contractual agreement.
• The competitive nature of contract bidding puts an emphasis on measurable costs, such that the relationship between client and contractor is underpinned by the contractor having to make a profit – at the expense of service.
• Those few items that are  measurable dominate the thinking and relationship between client and contractor
• Innovation will arise from the client and contractor working together. The competitive tendering process will, however, encourage the contractor to keep innovative ideas to themselves so as to protect their competitive advantage.
• The misconception is that competitive tendering is the best way of ensuring “best value.” Research suggests that the tendering process adds at least 30% onto the cost of a contract

4 Convergent and Divergent thinking (Eidlman)

Dr Eidlam asks us to compare convergent (or simple) problems and divergent (complex) problems.

He takes us through the continuum from a convergent problem – doubling the area of a square to a divergent or complex challenge of educating your daughter to be an informed critical thinker. If we want to double the area of a square we form a square on the diagonal. It is a rule that works every single time. It requires no thought just the application of the formula.  If we then want to estimate the speed of an object hitting the ground we can use Galileo’s formula 32ft/sec/sec- but it is not 100% and more thought is required. When we now move along the complexity continuum we think of baking a loaf of bread. We can use a recipe but skill is required and the outcome is not certain etc. We then come to consider the task of educating your daughter. There are so many variables that come into play that there is no hard and fast set of rules, there is no full proof method. We must replace certainty with understanding and an ability to balance conflicting issues. We address the challenge through knowledge and empathy.

Dr Eidlman’s point is that the majority of organisations are working in complex divergent situations. It is a fallacy to think that we can solve divergent (complex) issues by using convergent (simple) methods.

5 Variation - SPC (Shewhart, Deming, Wheeler, Stapenhurst)

In everything and in every system there is variation. This is nature’s way. We collect data to gain knowledge about the performance of the system. The technique and underpinning theories for interpreting data that contains variation comes under the heading of ‘Statistical Process Control” (SPC) – with the main tool being the ‘Control Chart’

To represent variation and the use of control charts we have above supposed journey times to the office. In the first section we see journey times average 32.4 minutes with a variation between 48.1 minutes and 16.6 minutes – a range of 31.5 minutes. During the road works journey times go up to an average of 45.3 minutes. However on completion of the road works average time comes down to 24.6 minutes and the journey is much more predictable in that the range of the variation drops to 8.5 minutes.

The control limits which define the range of variation are calculated using a mathematical formula around + or – 3 Sigma. (This is where the term “Six Sigma” comes from)

What we deduce from this chart is that the system (the transport system) has a capability plus a range of variation. To secure improvement the system is re-designed. On completion of the redesign we are looking for improved average performance plus a reduction of variation.

Messages we need to take on board:

• The system has a capability – trying harder within the constraints of the system will produce nothing – may even make matters worse
• There is no difference between journey time on day 6 of 26 minutes and journey 7 of 34 minutes. They are simply reflecting the variation in the system. The driver on day 6 did not try harder. We refer to variation within the control limits as “common cause variation” – variation that we would expect to occur from the normal operation of the system.
• There are exceptions – day 9 when the driver had a puncture and the journey time was 50 minutes. The chart identifies these exceptions because they come out with the control limits. We refer to these occurrences as “special cause variation.”
• It is vital that we tell the difference between common cause and special cause variation. With common cause we redesign the system, with special cause we investigate the one figure for an explanation. Misinterpreting common and special cause is a frequent mistake. It is revered to as “tampering.” It has the tendency to increase variation – and complexity
• Tampering is all too common if management data is presented in tabulated form.

The  key message in context of variation is the need to contain and reduce variation. High variation contributes to complexity. Myron Tribus in many of his presentations likens variation to germs. It can infect organisations.

“Understanding variation is the key to success in quality and business”

 W Edwards Deming

Stability – process with limited variation – permits continual improvement. Processes with high variation create complexity from which it is very difficult to achieve continual improvement. Plus highly complex systems can easily tip over into chaos – see an example from Esso’s plant at Longford. (Section 7.1.1)

6 Learning Organisation (Senge, Capra, Wheatley)

Learning within an organisation can be seen on two different and separate fronts:

• The learning of the individual
• The learning of the organisation.

There are many organisations that comprise very learned individuals, but as an organisation, change and modernise very slowly. The classic examples are our universities, who have very learned individuals, but as an institution have the structure and methods that they have always had. This is despite extensive research on how we learn.

Furthermore, in the modern world, organisations are seen as living organisms – living entities. The analogy used is that of a person cutting its finger. When a finger bleeds the body immediately reacts by rushing coagulants to the wound. It does not wait till a message has been passed to the brain and instructions are feed down the nervous system.  It reflects nature, all the parts have their particular intelligence and react accordingly.

Agile organisations that have a fully developed learning capability have similar attributes; the intelligence of the parts are conditioned and trusted to react to issues wherever they occur in the company or its market.  Companies that are less agile and have a poor learning capability tend to be hierarchical and require any change to be approved by superiors.

As described by Margaret Wheatley:

• Life self-organises. Networks, patterns and structures emerge without external imposition or direction. Organisation wants to happen.
• People are intelligent, creative adaptive self organising and meaning seeking
• Organisations are living systems. They too are intelligent, creative adaptive, self-organising, meaning seeking.

The above thinking moves the focus of management away from “controlling” people and onto how they direct and utilise the “self organising” attributes of employees.

7 Flow, measurement and listening ( Deming, Johnson and Broms, Toyota)

Tom Johnson is an accountant who is becoming increasingly critical of his profession. With Anders Broms they studied Toyota, the most profitable auto maker in the world and the Swedish truck manufacturer Scania, the most profitable maker of large trucks in the world.

What they observed was that these two highly effective companies focus on the flow of the work. They do still use the budgeting process but keep it very much in context. And to get information regarding the flow they listen to those engaged at the work face. They listen to stories.

They also accept along with Deming etc that we can only practically measure 3% of the whole.

“3% of problems have figures, 97% of problems do not”

W Edwards Deming

And further they identified with Deming’s 5th deadly disease is “Running a company on visible figures alone (counting the money).”

The authors tell the story that when Eiji Toyoda visited Henry Ford’s River Rouge plant in the 1930s he saw a system achieving low costs by balancing every step in a continuous flow. His eyes did not see the efficiency of every part (reductionist thinking) but smoothness of the flow (whole systems thinking)

And from that day that it has been flow that has been the centre of attention for Toyota. The River Rouge plant only had the one product – model T fords – in one choice of colour “black.” Toyota deals with much more variation so the challenge of obtaining a balanced flow was not simple.

And in working in this direction Toyota involve their workforce. The following are some figures from their quality circle initiatives.

From this table, may we firstly highlight the enormous power coming from the thinking from the shop floor; secondly that it takes great time and effort to tap into that power. Volvo in Sweden worked to emulate these initiatives and after seven years had only got to an average of 1 implemented suggestion per employee. In the 1980s UK companies tried to emulate Toyota’s success with quality circles and they got nowhere.

Johnson and Broms did not use the example of quality circles in their book – but they did emphasize that management listened to their employees – they listened to their stories.

A further observation of the authors was what they called the information factory. That is the “management” effort invested in the whole control and reporting systems of a company. They noted that in both Toyota and Scania this management effort to lead the company was significantly lower than in most Western companies.

Figures from a straight forward unit in the NHS in Scotland, revealed that  – 48% of effort was dedicated to ‘management’ in one form or other – meetings, reports, appraisals etc. and only 39% available to actually serve the patient. The other 13% was waste in one form or other.