The Olympic "edge"

When you are running a blog entitled "Exceeding Expectations" you really have to include an article on the Beijing Olympics and especially the performance of Team GB.

We define Excellence as exceeding both requirements and expectations, requirements being tangible and expectations being intangible. The team exceeded requirements in terms of both medal count and final position in the medal table. In doing so they exceeded the expectations of their funders and sponsors and of the country as a whole. Certainly we did not expect to become a sporting superpower but that's exactly what fourth in the Olympic medal table makes us and boy do we all feel good about that!

We know that Competitive Strength is strongly linked to Excellence. High levels of Competitive Strength in any context enables people to exceed requirements and expectations. In the case of Olympic athletes this is not just about the talent, dedication, hard work and ambition of the athletes themselves but about the back up teams performing to the same level.

Here is Bradley Wiggins a double gold winner and member of the all conquering GB cycling team on this subject. "We have an unbelievable team behind us, management and technical. I know with confidence that when I step onto the track my bike will be in absolutely perfect working order. I can't remember the last time a mechanical problem was a factor in any GB races. When I start a race it is big boost mentally to have certain knowledge that nobody lining up against me starts with an edge. In fact it is always us who have the edge".

With this level of Competitive Strength our cyclists were nigh on unstoppable. They are best cyclists in the world with the best back up team. How many of us running businesses or public sector organisations can honestly say that our front line people can line up to do their jobs every day "knowing they have the edge"? What could they achieve if they did know this?

Our last few articles have focused on the different thinking that is needed to achieve Excellence through Competitive Strength. So what about Usain Bolt then? This man is not built for sprinting says the conventional thinking. He is too tall, his stride is too long and slow and really he is much better suited to 400 or 800m. Well Bolt and his coaches have rewritten some of the rules of sprinting by finding a way to adapt his stride pattern in such a way that the supposed weaknesses are turned into competitive advantage. With this Bolt made history and now other coaches will have to rethink what it takes to sprint 100 and 200m. It certainly is not going to be "run a bit faster the way you have always run", because that isn't enough to beat Usain Bolt!

The last two articles have focused on British Airways and how their conventional thinking dictates their strategy and response to challenges. In the last article we contrasted this with the different thinking displayed by Virgin Atlantic with an example of a stunningly high standard of customer service. Well today Virgin announced a leap in profits from £6m to £34.8M for the year. Profits for the first quarter of the current year are £23.5m and business class passengers (the most profitable) are up 22% with overall numbers up 7.6%. So whose employees know that they " have the edge" and does it make a difference? Answers in the comments please.

So congratulations to Team GB and here's to London 2012. To find out more about Competitive Strength and different thinking go to the brand new Changeworld website.

Nassim Nicholas Taleb: a Scary Message you must not Ignore

Some extracts from The Sunday Times June 1, 2008

When this man said the world’s economy was heading for disaster, he was scorned. Now traders, economists, even NASA, are clamouring to hear him speak
Last May, Taleb published The Black Swan: The Impact of the Highly Improbable. It said, among many other things, that most economists, and almost all bankers, are subhuman and very, very dangerous. They live in a fantasy world in which the future can be controlled by sophisticated mathematical models and elaborate risk-management systems.
To explain: black swans were discovered in Australia. Before that, any reasonable person could assume the all-swans-are-white theory was unassailable. But the sight of just one black swan detonated that theory. Every theory we have about the human world and about the future is vulnerable to the black swan, the unexpected event. We sail in fragile vessels across a raging sea of uncertainty. “The world we live in is vastly different from the world we think we live in.”
In December he lectured bankers at Société Générale, France’s second biggest bank. He told them they were sitting on a mountain of risks – a menagerie of black swans. They didn’t believe him. Six weeks later the rogue trader and black swan Jérôme Kerviel landed them with $7.2 billion of losses.
As a result, Taleb is now the hottest thinker in the world.

Taleb goes much further. In his book he claims that the increasing centralisation and consolidation of both economic and financial structures is leading to two very dangerous outcomes. The first is the excessive and little understood dependence of large lumps of the economy upon each other – now trouble in one area brings unexpected repercussions in another. The second is the “brittleness” that results from over-complexity and over-control. By brittleness we mean the combination of rigidity and slowness of response from which an organization will go much further down the path into serious trouble before it either becomes aware of the risk to itself or able to do anything about it. Recent examples include Northern Rock and Bradford & Bingley - oh yes, and the Gordon Brown Government.

Taleb spells out for economists and financial analysts what every control engineer has always known – lack of damping produces massive instability and over-damping leads to sluggish response. He illustrates what every scheduling engineer has always known, that over-utilisation leads to performance failure and unexpected costs. He spells out, albeit in less than simple terms, that over-concentration of resource, over-regulation, over-complexity of systems and organisation, over-attention to “efficiencies” all add up to excessive fragility - to a lack of robustness – to a loss of agility - and inability to cope with the unexpected.

He says that the people who lead the economy are Not Thinking Right.

Taleb argues that every major change, either good or bad, is unexpected – is a Black Swan. We agree very strongly with his analysis. We have been arguing for years that the key to success in an uncertain world is Changeability – the ability to manage change rapidly and effectively for yourself, the people you work with, and your organisation. We maintain that flexibility and agility are the keys to rapid response to unexpected events. We say that 100,000 tons of gun boats will beat 100,000 tons of battleship every time and then be ready to do something else very different but useful as soon as that is sunk.

This is a Different Way of Thinking.

We are certain that high Changeability is one of the determining attributes of organisations that massively outperform their competition, that win Excellence awards and that have been shown, by Dr Vinod Singhal of Georgia State University, to deliver outstanding financial results. We suspect that our long held view about the high agility of small organisations compared to large is supported by Taleb’s analysis. We do not believe that centralisation and consolidation of systems and resources will necessarily deliver “efficiency”. All too often the opposite can be seen as the wrong measures drive in the wrong results*. The NHS may prove to be a case in point.

* Want a Wrong Measures example?
A large company decides that a new single networked linked printer will save cost compared to the many desktop printers scattered around its offices. The print-cost-per-copy saving is massive. It’s a no-brainer. It’s obvious. They install it. Now they have staff queued up by the machine, or walking to and from it, waiting for print outs instead of being at their desks talking to customers and dealing with transactions. That is not a real saving – invisibly their overall costs will increase (lower productivity), very probably their customer service level will decrease. (But do they measure that?)
This is a simple example, maybe you have experienced something similar yourself once upon a time – just how many other parallels can you think of?

Taleb is telling us that we need to be ready.

Are you Ready?

Have you any idea just how Different your Thinking might need to be? You can measure your own Changeability – you can get a very good idea of how well your organisation will handle the next Black Swan to come your way – you can even give some of your white swans a brisk shaking to see if they conceal black. And you can decide quickly what to do about all this.
You can do all this with the Competitive Strength Report process. It is rapid but rigorous. It is simple to do but without simplistic answers. You can complete the process within 3 weeks: 40 minutes on a web questionnaire, 2 hours of homework with your 60 page workbook and two half day workshops. And it is designed to be highly affordable.

The Competitive Strength Report is the World’s first speedy, affordable and totally objective measure of Comparative Competitive Strength. You can find out more at our web site www.changeworld.co.uk/csrataglance.