To change or not to change

over time, the phenomenon of ‘strategic drift’ will occur ... This may be a process which takes very many years may not be discerned by the managers until the drift becomes so marked that performance declines ... As this drift becomes recognized, the organization is likely to enter a period of flux, in which there is no clear direction and a good deal of disquiet and counterargument about the strategic direction of the organization.

- G. Johnson, 'Managing Strategic Change', 1992 [1] 

A 1992 management paper gives an interesting angle on how our governments are adjusting to our current financial, economic and fiscal crisis. Whilst Johnson was studying companies rather than governments, both are driven by many of the same dynamics that drive any complex organisation.

Faced with a stimulus for action, for example declining performance, managers first seek for means of improving the implementation of existing strategy, perhaps through the tightening of controls. In effect, they will tighten up their accepted way of operating. If this is not effective, then a change of strategy may occur, but a change which is in line with the existing paradigm.

What an apt description of the mess we’re in and how our leaders are dealing with it. Faced with stagnant economic growth and severe national debt problems for a decade or more, our solution is to tweak our systems and patch them up with liquidity.

Challenges to the legitimacy of constructs within that paradigm are not only likely to be disturbing because they attack those beliefs which are central to managerial life, they will also be interpreted as threatening by political elites in the organization ...

In these circumstances it is likely that, over time, the phenomenon of ‘strategic drift’ will occur  ... This may be a process which takes very many years may not be discerned by the managers until the drift becomes so marked that performance declines.

...

As this drift becomes recognized, the strategy of the organization is likely to enter a period of flux, in which there is no clear direction and a good deal of disquiet and counterargument about the strategic direction of the organization. This will be likely to affect performance negatively and, perhaps, be followed bv a more radical change in strategy (Figure 3, Mode 3).’

So what if the current structure, institutions and power dynamics of our governments is simply not suited to deal with the huge challenges of our times: competitive pressures from emerging economies, an ageing population, low economic growth, a highly complex financial sector, a more unpredictable world in general and a system which allows borrowing all the money needed for government’s short-term budgets? What could "mode 3" (see below) look like?

 

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[1] Johnson, G. (1992): “Managing Strategic Change – strategy, culture and action”, Long Range Planning, vol.25, no.1, pp. 28-36

Kigali in 1968 to today

Not a new picture, but it still impresses me. The first picture is from 1968, the others are recent.

Another useless MBA?

If all goes well, I will be awarded an MBA later this year. There is some disagreement on the usefulness of MBAs, with one of the “MBAs-are-useless” argument running something like:

MBAs are meant to train managers who are used to making intuitive “common sense” decisions to use more process and model-based reasoning. Examples of this are “Porter’s 5 competitive forces model” or the “5 Ps of marketing”. However there is not clear evidence that such methods and models produce better decisions or better managers. Furthermore, after completing MBAs most managers simply fall back into old practices and habits.

For a long time I held the view that an MBA is mainly just a good way to learn a certain “vocabulary” as well as financial analysis skills, but beyond that has a theories and models of questionable usefulness. With time however, it became increasingly clear to me what an MBA does and does not achieve.

Broadly speaking, we have two different ways of making decisions: intuitive and rational. An intuitive decision is what some would call “common sense”. This type of decision making is great for very complex decisions and also those in which we have significant experience. For example, “Employee X simply isn’t the right person for this job, based on my overall impression of their competence.", or “That company brochure simply looks unappealing.” Rational decision making however is far more limited in such complex situations because it generally forces an over-simplification. For example, “After evaluating Employee X’s levels of attributes W, Y and Z, we found them to be lower than required.” In such a situation we are likely to find ourselves tweaking the rationally formulated indicators to match up with our intuition. As a result, most of us make the vast majority of our decisions intuitively. It’s faster, more efficient, is better at dealing with high levels of complexity and taps into sub-conscious thought processes. So what role is there then for rational problem solving of the type propounded so strongly by management sciences?

Rational problem solving, which is the predominant (but not the only) form taught in MBAs is only actually useful for a small percentage of situations where intuitive problem solving breaks down. When past experiences, biases or blindspots mean that we need to take a “step back” and re-evaluate on some other basis. Why then should we care so much about this small fraction of situations? Because it is precisely these new, previously unencountered, non-routine situations that force our most important decisions. Think of the financial crisis, the rising importance of China or the development of new technologies. It is too tempting to intuitively apply past experience to future situations. Our minds apply past patterns to current situations and make mistakes with often tragic consequences. Some of these seemingly "common sense" rational models allow a framework for an explicit evaluation of a new situation and the assumptions behind our reasoning. This is an immensely powerful supplementary "toolbox".

Businesspeople

Gregory Tayi and Olivier Ngororabanga coordinated one of the micro-hydropower projects GIZ supported whilst I was coordinating the project there in 2006-2009. It was a great pleasure and privilege to work with both of them. Gregory was interviewed a few months ago by the BBC: http://www.bbc.co.uk/news/world-africa-15695209. It's a charming interview:

The main capital one has is oneself; to know what one wants and where one wants to go.

...

Money is not what makes the [business]person. ... [Business] is making life easier for others.

At the inauguration of the REPRO micro-hydropower plant in 2010

Restart

I have decided to start blogging again. This has a number of reasons, notably:

• Writing is a great way to sort and articulate my thoughts on a particular issue for myself.
• Apparently some other people find these thoughts interesting as well.

I have learned that I get intense satisfaction from the very rare occasions that I add value to people’s lives and add leverage to their work. On a basic level are emails, advice, analysis or consultancies that help people improve the way they work – particularly if their work in turn positively impacts others. At the top end of the scale would be helping someone build up a business that improves their lives, their employees’ lives and their customers’ lives. Unfortunately, such moments have been scarce in my life so far.

But this is what continues to motivate me, and hopefully this will become a theme of this blog.

Congo and Rwanda

An article from the New York Times.

Wow.

Good place to drink beer #2

At Virunga Lodge on a hill between Lake Bulera and Virunga National Park in early December.

Muzungu's burden

Having finished a long overdue reading of William Easterly's book, White Man's Burden a couple of months ago, I was pleasantly surprised by the book: Easterly's articles (e.g. Can the West Save Africa, Dismal Science) tend to be a rather excessively pessimistic deconstruction of the failings of modern development aid; in this book Easterly goes much further in proposing ways in which we can move forward in solving the problems of the poor.

The central argument is one of Planners versus Searchers. Easterly's Planners are the proponents of the classical top-down development aid. This is particularly prevalent in the large bi-lateral and multi-lateral donor organisations. The Searchers are grass-roots implementers who try out and search for techniques and projects that work. Many grass-roots NGOs can be described as Searchers. Reform of development aid according to Easterly should involve a shift of power from Planners to Searchers. Easterly also tackles a range of other development issues such as accountability, recipient country participation and military intervention.

White Man's Burden is often seen as the antithesis to Jeffrey Sachs' book, End of Poverty. This comparison hardly does Easterly justice. The End of Poverty is a mostly anecdotal account with very little hard data to back up the core theses of the book. White Man's Burden bases its arguments on historical data, and uses anecdotal evidence only to complement, illustrate and occasionally complete when statistical data is insufficient. By comparison, I found The End of Poverty a weak and sloppy work that borders on populism.

I do however find one important weakness in the argument of White Man's Burden. Whilst results-oriented Searchers may indeed be able to offer direct solutions to straightforward problems such as school enrollment and mosquito bed nets, it is unlikely that more long-term projects such as private sector development or vocational training will work in the same way. Long-term projects tend to require people who can afford to worry less about immediate results. There is a balance to be struck.

This is an excellent book and an entertaining read.

Terraforming with rubbish

Kigali landfill site. Standing on a really big pile of rubbish.

Turpitude

I just figured out that German citizens don't actually need a visa to the US. Yay. There is however an Electronic System of Travel Authorisation (currently voluntary) which includes some great questions such as:

Are you seeking entry to engage in criminal or immoral activities?

That started me thinking about any immoral activities that it could be fun to engage in whilst in the US. Is self-idolatry immoral?

Have you ever been or are you now involved in espionage or sabotage; or in terrorist activities; or genocide?

Yes, Boris and I have been covertly trying to collect information on your ingenious political system in order to replicate it in the Congo.

Have you ever detained, retained or withheld custody of a child from a U.S. citizen... ?

I assume this means its ok if I detained a child from a citizen of another country?

Have you ever been arrested or convicted for an offense or crime involving moral turpitude...?

I had to look up "turpitude". The first thing Wikipedia comes up with is that is is a legal term used in the Visa Waiver forms without proper explanation.

Am I morally turpit? Leave your opinions in the comments.