Last year we created a video explaining the benefits of coming to the Annual Lean Healthcare Transformation Summit. The experiment went pretty well, so we are doing it again. Click on this image to watch the video.
If you are not registered for the Summit, it’s too late now. We have reached capacity. That’s a new thing for us this year. It’s a big deal.
I’ve been doing lots of reading (and re-reading) about the science behind “S-Curves”. I recently blogged about paradigm shifts and S-Curves here, here and here.
One of the authors, Adrian Bejan, discovered a law of physics that explains the phenomenon of S-Curves. It is call the Constructal Law. In his book Design In Nature he defines this new law:
“For a finite-size flow system to persist in time (to live), its configuration must evolve in such a way that provides easier access to the currents that flow through it.”
In this book, Bejan writes:
“One of the most powerful insights born from the constructal law is that social systems are natural designs that emerge and evolve to facilitate the flow of the currents they represent on the landscape. This evolution has a direction in time toward greater and greater access to move more mass (for example, people, goods, information) per unit of useful energy.
“To show that human organizations are governed by this principle of physics, we should find two features. The patterns of their channels should have a vascular shape and structure as we observe in other point-to-area flow systems, and this patterns should evolve in time to provide greater flow access.
“This is what we find. To see how, we have to introduce a cornerstone characteristic of natural design-hierarchy. Although it has received a bad rap as a symbol of inequality, hierarchy is essential to good design. Instead of providing advantages to one entity to the detriment of another, it arises naturally because it benefits the entire flow system.”
The prevailing view of an organization is the hierarchy as shown below. Peter Scholtes provided one explanation about the history of this structure in his book The Leaders Handbook.
Here’s the story as he tells it:
“On October 5, 1841, two Western Railroad passenger trains collied head-on somewhere between Worcester, Massachusetts and Albany, New York, killing a conductor and a passenger and injuring seventeen passengers. That disaster marked the beginning of a new management era.
“Prior to the early 1800s in the United States (and the early 1700s in Europe), business was much the same as it had been since the Middle Ages: operating as cottage industries, tradespeople made their wares one item at a time and sold them to their neighbors. There was no “manager.” The owners of the enterprises did the work themselves or coached apprentices and assistants who did the work alongside them. In Europe, quality was assured by guilds and their marks of approval.
“Then came the development of coke as a fuel in England and the discovery of anthracite coal in Western Pennsylvania, both leading to the possibility of mass production and mass distribution. The owner of a cottage shop could choose to hire engineers to build machines of mass production and by 1830 begin to use the burgeoning rail systems for mass production. Or the shop owner could stay in the “cottage,” continuously worrying about competition from those on the rail system who had entered the new industrial age.
“It was the time of a great paradigm shift in managerial thinking, the equivalent of letting go of a managerial flat-earth perspective. For the owners of businesses, these were truly traumatic times, requiring them to rethink the premises and practices of their work: How, they asked, will we run a large geographically dispersed organization?
“Other than the army and the church, there were few models for such a management practice in the 1800s. The railroads were the first industry to come to grips with how to manage in the new era. In the United States the Western Railroad was the first to extend itself beyond ordinary regional boundaries, the first with complex schedules and multiple trains on the same track. it was also the first with a disastrous train wreck, a harbinger of tragedies to come.
“The Massachusetts legislature launched an investigation into the causes of the train wreck and the directors of the Western Railroad appointed a committee headed by Major George W. Whistler to find a remedy. Their recommendations had major immediate impact on the railroads, over the next decades, helped all of U.S. managerial practice.
“Part of the recommendations for the railroads was an organizational structure that looked like the “train wreck” chart (same as the organization al chart image above). While the standard organizational chart may seem ageless, it was, in fact, adapted from the Prussian Army and introduced to American business practice as a way to prevent train wrecks! In its time , it was revolutionary. Its unique features:
* Central offices run by people called “managers” (a new term)
* Distinct functional divisions
* A “chain of command,” clear line of authority
* Clear lines of communication and reporting
* Clear descriptions of responsibility for each individual from top to bottom.
“Daniel McCallum, President of the Erie Railroad, later elaborated on the Western Railroad’s chart with his Six Principles of Administration:
1. A proper division of responsibilities.
2. Sufficient power conferred to enable the same to be fully carried out, that such responsibilities may be real in their character (that is, authority to be commensurate with responsibility).
3. The means of knowing whether such responsibilities are faithfully executed.
4. Great promptness in the report of all derelictions of duty, that evils may be at once corrected.
5. Such information, to be obtained through a system of daily reports and checks, that will not embarrass principal officers nor lessen their influence with their subordinates.
6. The adoption of a system, as a whole, which will not only enable the General Superintendent to detect errors immediately, but will also point out the delinquent.
Scholtes goes on to say:
“A fundamental premise of the “train-wreck” approach to management is that the primary cause of problems is “dereliction of duty.” The purpose of the organizational chart is to sufficiently specify those duties so that management can quickly assign blame, should another accident occur.”
So where does the idea of paradigm shifts, S-Curves and the constructal law physics help us to understand what the new role of hierarchy will be (if not “command and control” and “blame”)?
I think the new job of top management (and the hierarchy) is “side management” as illustrated in the diagram below.
Management should not be in the role of “customer.” That black line represents the work systems that the front line employees are involved in every day to provide value to the customer. Management should exist to support this effort, to align the work of everyone to provide value to the customer.
Top managements new role is “side management”, and they are not the customer.