Political savviness as a leadership tool

Back when he was still editing The American Scholar, Joseph Epstein used to remark that his responsibilities as editor involved little more than "opening the mail." What he meant was that the journal had acquired enough of a reputation that good writers regularly submitted solid and thoughtful pieces for publication with no prompting from his side. All he had to do—or so he claimed—was to open the mail, see what had come in this month, and then send it to the printer.

A blogger's job is rarely so easy, but I am always delighted when I find something I can share with you. This week it is a short video that I found posted on myASQ, ASQ's social media platform. Its title is "Political savviness as a leadership tool," and it was originally posted by Luigi Sille of ASQ's Human Development & Leadership Division. Mr. Sille and the HD&L Division retain all rights to this video, and I gratefully acknowledge their permission to share it here.

The central message of the video is a simple one: political skill is a fundamental leadership tool. It doesn't get the acclaim of talents like vision and strategy, but it is just as important. No matter how inspiring the vision or how brilliant the strategy, there will always be internal friction in any organization when you try to implement them—simply because there is always friction when people work together. Political skill is nothing more than the lubricant for that friction, the ability to work with others inside an organization in order to get things done. 

Many people hear the words "political skill" and think of something bad; they associate the concept with force or fraud, with coercion or manipulation. Of course sometimes those things do happen inside organizations, but they are dysfunctions and they are the exception. Most organizations get along fine without them. And associating political skill with those kinds of behaviors is like associating weather with hurricanes and tornadoes: sure, they are dramatic, but they aren't the whole story.

It's a good video, and it will cost you only a minute. I hope you enjoy it.

  

           

Quality in hard times

In last week's post, I remarked on the risk that mismanagement can teach employees not to care about the quality of their work: specifically, if employees are penalized for doing good work, they will quickly learn not to repeat the experience. A reader commented that this outcome doesn't even require active mismanagement; the simple failure to reward good work can do damage by itself. She wrote that the absence of any "consistent opportunity for reward can create a 'well, why bother then?' atmosphere." And of course she's right. I suspect many of us have experienced contemporary examples of exactly this dynamic at one point or other. In further discussion, she gave me a concrete historical example from the history of the British Royal Navy, whose officer corps had become so crowded during the nineteenth century that no further promotions were possible. Nor were there a lot of wars for the Navy to fight, once Napoleon was defeated in 1815. So with no chance for fighting and no hope of promotion, many officers stopped caring about their work and the corps began to rot.  

'What comes next? They become careless of themselves; most of them take to drink, more or less, for that is a habit almost impossible to wholly abstain from, while leading that kind of monotonous life; from that they become despised by their seniors in the service'.... The diary of a seaman in the Leander in the Pacific in 1863-5 notes seven officers court-martialed for drinking, not counting the chief engineer who died of it.*

Not officers, but you get the idea.

But this observation raises a further question. What does reward mean? Are rewards always money? If yes, we have a problem, because no company can count on consistent profitability, year in and year out. One year, somehow, times are going to be tough. One year, somehow, there won't be any extra cash on hand to distribute rewards for even the best service. And it would be painful to think that hard times might destroy the incentive for quality work.**

I have worked for companies that hit hard times, and my experience is that we continued to do good work. But everyone's case is a little different. There were a couple of people who were just there for the paycheck, or who had financial obligations that couldn't wait: they left promptly for greener pastures. And there were a couple who were laid off as the company retrenched. But many of us stuck it out, and continued to do the best we knew how.

If I ask myself Why? I see a number of factors. One is that we had already built up an ésprit de corps from working together in better times, so that none of us wanted to let down our colleagues. We weren't supporting The Company (which is more or less an abtraction), but we were supporting Larry in the next office, and Frank down the hall—people with whom we might bicker about little stuff, but whose work we still respected.

A second factor is that management communicated with us openly, and—so far as we could tell—treated us fairly. They rolled out information in All-Hands Meetings, so that everyone got the same message at the same time. And they let us know, "Here's what we can do for you today; here's what we want to do for you but can't right now; here's how we plan to get there." Knowing that we were all in the same boat made a difference. Knowing that we weren't being played for suckers made us willing to do our part.  

We discussed similar points in this blog last year. Mostly people like working together, so they are willing to cut the company some slack when things go wrong. But people can think for themselves, so they want you to tell them the truth. (And they can usually tell if you are lying!) People need you to give them honesty, respect, and simple justice every single day—which is far more often more than they ask for a raise or a bonus. So if you (as manage­ment) are willing to fulfill your obligations to give your people honesty, respect, and justice—even when you can't back those up with more money—they are generally willing to return the favor by continuing to fulfill their obligations to you. 

Thus can you ask for quality work even in hard times. But only thus!

__________

* From N.A.M. Rodger, The Price of Victory (New York: W.W. Norton & Co., 2024), p. 75. I thank Terri Williamson for raising the point out of her study of the Royal Navy, and for providing the citation. 

** The point would become even more acute in case the economy as a whole were ever to enter a contraction spiral, because then employees couldn't just jump to a profitable competitor. For explorations of this possibility, see e.g. the research of J.M. Greer, for example here.     

           

Where do you start? — take two

Last week, I wrote about employee engagement—and espcially about the research that suggests a strong correlation between employee engagement and business performance. But while I was writing, my mind started playing with the idea to see where it would lead.

In the first place, while the article that I reviewed was careful to assert no more than a correlation between engagement and performance, I reflected: If there were a causal connection, which direction would it point? Is it more likely that good business performance would cause employees to feel like they understand their jobs and have the tools they need? Or is it more likely that employees who do understand their jobs and do have the tools they need will perform well in the marketplace? Pretty clearly the second one is more likely.

In the second place, the article makes it clear that the measures for employee engagement are actionable. If your employees feel neglected and unengaged, there are concrete things you can do to improve the situation: make sure they know what is expected of them, make sure they have the tools that they need, praise them when they do well, and so on.

Then suddenly I thought of an article that I posted here four years ago. At the time, I asked: if you have just taken over responsibility for the Quality system in an organization that needs reform, where do you start? At a practical level I stand by what I said then, that internal system audits are the only way to get objective information about what's missing. But if you have several parts of the organization that need attention, where should you focus first?

Based on the Gallup results, I think the answer may be: Management.

After all, IF it is at least plausible that improved engagement drives higher quality work and improved results, and IF management can take concrete steps to improve engagement, THEN doesn't it seem likely that trying to improve performance without those concrete steps by management will be an uphill battle all the way? We have already seen that treating your people with justice and respect can be an important form of preventive maintenance to make sure the organization functions the way it should. So it stands to reason that if you want to reform or reinvigorate an organization, those are the points you should check first.

Now I want to draw a distinction. If you have to address "Quality issues" throughout an organization, that can mean two different things.

• Case 1 is a case like the Riverville plant that I discussed last month. The people there wanted to do a good job, but they had a different definition of how to get there than the managers of Octopus Enterprises who had recently acquired the place.
• Case 2 is more severe. It's the kind of place where people don't care about doing a good job, and just want to get through the day.  

In Case 1 people still have the right attitude, so I think the core issue is one of communicating how the new system will help them achieve the same good results they are already trying to achieve with the old system. Ideally, the new system will make things easier, though as we saw in the case of Riverville, the transition can be tough.

But Case 2 is brutal. And there I have to ask, How did things ever get this bad in the first place? My assumption—and I admit it is just an assumption—is that most people start off wanting to do a good job. If that's no longer the case in a particular workplace, my first guess is that the employees have been taught not to care about doing good work by management practices that penalize them when they do. The other possibility is that management inadvertently hired one or two bad apples, and then failed to remove them before they succeeded in corrupting the others. Either way, it is unlikely that the rest of the organization will reform until things are improved inside management.

And really, ... how would you reform an organization's Quality focus without insisting on Quality in management? I think it would have to be like the old Internet meme: The beatings will continue until morale improves.

CAVEAT: I have never had sole responsibility for turning around the Quality performance of an entire organization. And I know that ideas which make sense at my desk are often wrong in the real world. 😀 So I might be wrong about this too. If you have experience that leans in a different direction, please leave a comment to tell me about it!  

           

Know your own procedures!

Who needs to understand the procedures in your department?

Well, I suppose you do, for a start. The other people in your department should understand them too, or anyone else doing the same work. The people who interact with your department should understand enough that they can work with you. If you work with the public, then they need to know enough to do their part: the Information desk is here, and the Returns counter is over there.

How about your boss?

Of course. The boss established all the procedures, so of course he understands them.

How about his boss? How about top management?

Umm ... I guess. Maybe not in detail, but overall. Why? What's your point? 

You'd be surprised.

In a sense, maybe it shouldn't be a surprise when top management doesn't know the procedures that run their own company. Most of their day is spent doing other things. Still, it can be awkward. These are the people, after all, who decide on the company's strategic direction. But what if the new direction points somewhere that the procedures aren't designed to go?  

It sounds like a frivolous or captious question, but it has been known to happen. Robert Cole tells the story that in 1983, Ford's CEO instructed the company to improve relations with their supply base, as a key to improving their suppliers' performance.

"Based on this, [L. M.] Chicoine [Ford's vice-president for purchasing and supply,] publicly called for increasing the number of long-term contracts (greater than one year) with Ford. To his surprise six months later, he found there was no change. Because Ford rules called for extensive bureaucratic approval for any contract greater than one year, no supplier was interested in tackling that."* 

Sometimes the disconnect between management direction and corporate behavior is more subtle. Another story from Cole tells of ongoing discussions in the early 1980's between Intel and one of their major suppliers, the Japanese firm Kyocera. Intel argued that they got poor service and poor terms from Kyocera, compared to Kyocera's other customers. 

"The Japanese managers responded with a riddle to Intel queries: 'To Kyocera, the customer is always king. But reliable kings have reliable servants.' The Intel managers finally figured out that the point of the riddle was that although the customer (Intel) might be king, it nonetheless had to act in certain ways to produce reliable supplier behavior. Above all, that meant no order cancellations, level production, and an overall predictable environment for suppliers."**

In the story about Ford, top management genuinely did not understand what steps were required by their own procedures. In the story about Intel, top management did not understand how their normal behavior was perceived by others. But both cases represent a kind of disconnect between the strategic direction that top management wanted to go, and the organization's ability to get there.

I have tried to think about my own experience, and can't recall any disconnects as significant as these ones. But I have certainly seen how easy it is for top management to miss realities on the ground, because the people around them shield them from inconvenience. Once I worked for a company where the management held periodic Town Hall meetings, to get feedback from those of us in the trenches. At one of these meetings, someone complained that the IT department needed more resources, because whenever his PC broke it took three weeks to get it fixed or replaced. The vice-president who fielded the question genuinely didn't understand the issue: he explained that whenever he had a problem, IT always fixed it the same afternoon!

This phenomenon—this disconnect—is why it is so important for top management to get out of their offices and understand how the work is done. It is why John Seddon says that his first step when working with a new client is to send the management staff out to the front office to watch a single order come in, and then to track that order through its whole life-cycle. It is why Taiichi Ohno invented the Gemba walk.

The terminology differs, but the basic idea is the same. Before you can make decisions about what to do next, you have to understand what you are doing today. And that's not always easy. 

__________

* Robert E. Cole, Managing Quality Fads: How American Business Learned to Play the Quality Game (New York, Oxford: Oxford University Press, 1999), p. 112. 

** Ibid., p. 113.       

           

Managing critical issues

We've talked before about problem-solving (see for example this post here), but what do you do when everything comes unglued at once—when a problem hits the fan, and suddenly you are fielding calls from reporters and attorneys when you haven't even gotten all the facts yet? Yes, you need a robust problem-solving protocol, but at the same time you need so much more than that! You need to manage the news cycle, because a careless or unguarded comment can turn public opinion implacably against you or ruin your chances in court, even though you haven't finished your investigation yet so you really don't know what happened!  

A few weeks ago, I attended a very thorough presentation on exactly this topic. The speakers were Shubhada Sahasrabudhe and Shalabh Tandon of QuRIuS Consulting LLC, the talk was sponsored by the ASQ Phoenix Section (704), and you can find a link to the YouTube video at the bottom of this post. The overall message is based on their recent book, Don't Panic, Pivot: Managing Critical Issues to Prevent Crises, and it is well worth your time and attention.

The authors start by explaining that a critical issue is not the same as a crisis, though it may cause a crisis if it is not addressed in a timely way. Major disasters can be caused by a succession of seemingly-trivial errors that were ignored, rather than set right; and the authors look at specific examples in some detail, including the Deepwater Horizon explosion, and the collapse of the Francis Scott Key Bridge. In each case, there were small signs in advance that something wasn't quite right. Based on this insight, they define a critical issue as follows: 

• An issue is any unresolved event that disrupts or hampers the normal operation, and that fails to meet the published or agreed-upon specifications.
• An issue is critical if it has time-sensitive impact (financial, safety, functional, etc.).
• And if not addressed urgently, a critical issue can become a crisis.  

Why does it matter? Well of course nobody wants to cause a catastrophic oil spill, or to destroy a major bridge. But the authors are careful to point out that the consequences of such a crisis affect multiple dimensions. Even if you momentarily set aside humanitarian concerns to take a cold-blooded look at the organization's own interests, a disaster hurts the organization in at least three areas: it damages operational efficiency, it can be ruinously expensive, and it soils the brand. (Regarding this last point, I have friends who check their travel plans to make sure they are not flying on Boeing planes, ever since the door blew out of Alaska Airlines 1282.*) So it is clearly in the organization's interest—even its narrowest self-interest—to watch for critical issues and correct them.

How do you do it? The authors sketch a method that looks, in broad outline, a lot like the protocol for handling an 8D. But there are a couple of critical additions.** 

1. Right at the beginning, in D2 (State the problem), evaluate whether this issue is critical. Make sure you understand the severity of the consequences, in case the issue blows up.
2. Then, during the impact assessment (typically also part of D2), make sure you address all relevant impacts: to operations, to finances, to stakeholders, and to your brand.
3. During D3 (Contain the problem), it is not enough to prevent the problem from spreading. You also have to contain the brand damage by making whatever public statements are necessary and appropriate, consistent with what you know at this point. Never speculate in public! Stick to the known facts, and promise you will come back with the full story when you have it. 
4. As you proceed through D4 (Find the root cause) and D5 (Define corrective action), validate your corrections before implementing them. Make sure that they address all affected stakeholders, and that they do not inadvertently cause further harm!

Perhaps the biggest change is that the authors break out Communication as a separate step between D6 (Implement corrective actions) and D7 (Assess risks and learn lessons). This addition confirms the point that harm to the brand can be as damaging as harm to customers or other stakeholders. And the authors give clear advice for all communication: make it timely, make it clear and unambiguous, and make it consistent. All of these points are important, but it is easy to overlook the last one. Or rather, it's easy, but don't overlook it! If you say one thing today and then backtrack tomorrow, people will think you are hiding something and assume the worst.

Finally, the authors break D7 (Assess risks and learn lessons) into two parts, because there is so much important work that has to be done there. On the one hand, they insist on the critical importance of a detailed After Action Review. But then you also have to implement Preventive Measures so that the problem can never, ever happen again. Both steps are important, so they list them separately to make sure neither gets shortchanged.

After all this, there's still a lot in their presentation that I haven't even touched. A single blogpost can do only so much. But check out the YouTube video below; if that inspires you, check out their book. There's a lot of detail here, and a lot of process to follow. But if you ever have to deal with a "critical issue"—even once!—you will be grateful to have a defined process that helps you keep your head amid the tumult. And of course implementing a system will be cheaper than trying to wing it, possibly by orders of magnitude. It's good to be prepared, and these authors can help prepare you.  

__________

* See also this post and the ones following.

** When I worked for Bosch, we had a similar procedure for similar circumstances. But this one is published, and to my knowledge the Bosch procedure has not been published yet. So I am happy to discuss this procedure.  

           

Goals that your people understand

You're at work, it's the middle of the morning, and suddenly everyone is called into the largest room you have, for a presentation. The CEO and senior management have just finished their new strategic plan, and they are going to share it with the rest of the company.

Do you get anything out of the next hour? Or do you just spend the time trying to look awake?

I've been in too many presentations where the latter was true. The CEO starts off by saying, "We have two main goals over the next three years: to become the number two supplier of refrangulated widgets, and to reach a market capitalization of twelve gazillion dollars. Here is how we are going to do it ...." Then the rest of the speech might as well be in Babylonian, for all that I under­stand it. I'm sure the CEO is following advice he read somewhere, that he should make all employees "partners" in the company's "strategic thinking." But because the message is in terms I don't know, the only thing I get from the meeting is that I am now an hour behind on the day's work.

It doesn't have to be like this.

What does a better way look like?

There is another way to roll out corporate goals, one that makes them meaningful to every employee. It takes a little more work up front, but this is the kind of work that the management team is paid for in the first place—so it's fair to ask them to do it. Also, if they run into problems in the preliminary setup, that's a key indicator that there are problems with the strategy itself. So it is worth the effort.

The method is called Hoshin Kanri (Japanese: 方針管理, "policy management"), and it draws a straight line between the company's long-term goals and the work I have to do tomorrow. This helps me understand the company's goals, because I can see the effect they have on my job in particular. But it also helps me see how my job fits into the big picture.

Ironically, I saw the method used long before I learned it had a name. I just thought of it as "The way That Company does goals," and I wondered "Why doesn't everyone do this?" But of course I couldn't ask my next employer, "Why don't we do goals just like that other company I used to work for, that you've never heard of?" It was a relief to learn the name.

How do you do it?

The whole process unfolds in several steps. Some people use a special matrix to organize their work, but I won't do that here. The logic is the important part, and you can organize it however you choose.

Define your strategic goals

First, you have to define your long-term strategic goals. Where do you want your company to be in five years? Be careful not to define too many goals, but focus on the handful that matter.

You may also identify your most important operating imperatives at this point. But again, be careful not to cloud the picture with too much noise. (For the distinction between strategic goals and operating imperatives, see the discussion in this post, under "What is a strategy, anyway?".)

How are you going to get there?

"A goal without a plan
is just a wish."

Next, plan out very concretely what you have to do to reach those goals. A familiar aphorism attributed to Antoine de Saint-Exupéry says that "A goal without a plan is just a wish." So define the actions you will have to take, and the milestones that will prove you are on track.

In the first instance, this means defining annual goals as progress towards your long-term targets. But it also means spelling out what your goals will look like, concretely, when you have achieved them, and then identifying what it will take to cross the gap from Here to There. If you want to be—let's say—the number two supplier of refrangulated widgets, what does that tell you about your warehousing and logistics systems? What level of performance do they have to reach, in order to support the overall corporate goal? But also, what is their performance today, and how far does it have to improve? Can you spell out achievable interim milestones towards which your logistics and warehousing personnel can aspire, that will get them where you need them at the right time?

And of course reaching this goal isn't even primarily about warehousing and logistics, though doubtless those play an important role. Every single department in the company should contribute to these goals somehow. So the CEO has to delegate to the respective department heads the task of working out maps for each of their functions which will support the common strategy.

As an aside, you should check that each department map is consistent with all of the others. If Engineering plans to develop the Next Generation Widget in Year Two using a special technical tool that IT doesn't plan to install until Year Four, somebody has to change his map!

Cascade downwards 

It doesn't stop there, but the next steps are pretty straightforward. You as a department head (or functional VP, or whatever your title is) now have a strategic map for what your department has to achieve in five years, and also in this year. Take it to your section managers or group leads, and go through the exact same exercise. Ask each of them to spell out how their group will contribute to meeting your goals. Notice that they don't have to reach all the way back to the company's goals, because your goals have already been aligned with the higher level. So as long as they support achieving your goals, they are also supporting the company as a whole.

Cascade this exercise down through the company organization, all the way to the shop floor. (Yes, this is exactly the same procedure I recommended three years ago for business continuity planning.)

The result is that I, as an employee, have personal goals to achieve that are directly related to my job. But if I achieve them, that supports my supervisor in achieving his goals, which in turn supports the department manager in achieving her goals, which ultimately rolls all the way back up to supporting the company in achieving its strategic targets for the year.

End of the year

Then at the end of the year, you evaluate how you did. This means everyone, at all levels. But the point isn't just to assign a grade, like in so many performance review systems. The idea is rather to carry out a root cause analysis on each missed target, to learn why it was missed, and then to update your plans with this new information. This way you—individually and as an organization—keep in touch with reality, learn lessons from experience, and adapt your strategy pragmatically.

I will admit that it is hard to remember to do this last step. Even when I worked at a company that did all the rest of it, that step was sometimes missed. But of course it is important.

           

Quality when you have no choices

Last week I argued that Quality has a role in determining the attitude management should take towards workers in the organization; because if management doesn't offer the rank-and-file such simple considerations as respect, truth, transparency, and justice, the organizational machinery is going to break down. In that sense, I said that showing your people respect and justice are just a form of preventive maintenance.

Was I wrong?

I got a reply telling me I was wrong. Specifically, this reader argued that sometimes people are trapped and can't walk away. She reminded me that I have written before about monopoly situations (like public utilities) where competition is absent, and that in such cases customer care often takes a back seat. 

As an aside, it is clear to everyone how these two cases are the same?

Under a monopoly, one party (the seller) provides a good, often a necessity (like gas, electricity, or water). So long as he continues to provide it, he can charge more or less whatever price he wants and can offer more or less whatever level of service he chooses. People who need the good in question will continue to buy from him because there are no alternatives.

By the same token, if membership in some organization offers benefits that some people can't do without—or if an employer hires people who can't afford to quit—those people will stick with the organization on (more or less) whatever terms the organization chooses to offer, because there are no alternatives.

The full comment introduces other examples as well, ranging from slaveholding to contracts with teaser rates. But in all cases the topology of the power relations is the same, even if the magnitudes are very different. 

Anyway my critic concluded—with respect to the discussion of ASQ's current controversies that started this whole thread—that "if there is a benefit to membership that’s (a) independent of the local programs, and (b) unavailable elsewhere, it seems to me that ASQ leadership can do whatever they darn like with your dues, and you members just have to lump it."

"We don't care. We don't have to."

It's a logical argument. We've already discussed that if the lines are too long when you go to renew your driver's license, you can't just patronize a competitor instead; so, perhaps unsurprisingly, there is usually a line. If a public utility messes up your service order, you may not have a lot of recourse short of contacting the regulatory entity that oversees them. And everyone remembers Lily Tomlin's famous line as Ernestine the telephone operator—even people who aren't old enough to remember Ernestine herself: "We don't care. We don't have to." (Ironically, she was spoofing the phone company, which is no longer a monopoly.)*

As for ASQ, whose management controversies, as I say, started this whole thread, there does seem to be a sense in some quarters that the membership are responsible to the management and not vice versa.

• On the one hand, there are regular exhortations from ASQ management encouraging the local sections to find new ways to attract and retain members.
• On the other hand, as noted in an earlier post, headquarters has cut off all the regular remittances of member dues to the local sections (notwithstanding that people are sensitive to loss).
• Nor was there discussion or consultation with the section leadership in advance of this decision (notwithstanding that people are sensitive to slights).
• Nor has there been any public discussion of these controversies inside ASQ. In fact, just last week there was an update to the Community Guidelines for the myASQ discussion forums, forbidding discussion of ASQ's Board of Directors or their decisions.** Nominally the update was to "ensure myASQ remains a welcoming, helpful space focused on our shared professional interests." But concretely that means, among other new provisions, that "Community members shall refrain from using myASQ for activities related to the ASQ Board of Directors or other Society elections, including posting discussions, blogs, and direct messages, unless explicitly authorized in writing." It is not clear to me whether ASQ hopes to keep members from finding out about the controversies, or just wants to push discussion to other locations. (There is extensive discussion on LinkedIn, for instance.) Either way, these developments have all taken place notwithstanding that people can judge independently of how you want them to.

So on the face of it, it does look like there is some point to my critic's argument.

Yes, but no

But I think "on the face of it" is the key qualifier. In general, exploitative monopolies can succeed in the short run, but they fail in the long run. Unless they offer benefits that are worth the cost, in the long run people figure out how to make other arrangements.

My critic talked about slavery. I am no expert in the economics of slaveholding, and I will leave any discussion to those who are. But if we look at a situation that was similar in some respects—I'm thinking of mandatory collective labor in the old Soviet Union—everyone knows that the private or black market economy was far more productive than the official, collective economy.*** It's true that most people couldn't run away. But they were often unmotivated. We've discussed before that the deepest source of Quality is love. For that very reason, though, if you don't care about what you are doing then your work will be no good. It will be at best transactional: Do this to get that. Pretty soon that becomes Do as little of this as you can get away with to get that. If everyone else is doing the same thing, the whole enterprise becomes a house of cards. The joke in the Soviet Union ran, "They pretend to pay us, and we pretend to work."

Think about it for a couple of minutes and you can come up with any number of other examples. It is true that sometimes the obstacle posed by this or that monopoly is very large. It may seem insuperable. But sooner or later, someone will find a way around it, if the monopoly doesn't fall apart first (like the Soviet Union) from its own internal inefficiencies. The only reason Christopher Columbus tried to reach Asia by sailing west was that the people who controlled the overland route were charging too much for spices.

What about ASQ? The society sells educational materials related to Quality, and it offers certification in the various Quality disciplines. These goods are professionally valuable to anyone in the field. In the terms posed by my critic above, they are "(a) independent of the local programs, and (b) unavailable elsewhere"—at least today. But strictly speaking you don't have to be a member to buy them. Members get a discount on classes and certifications, but non-members can buy them too. So is membership worth it? That's a personal decision, but it does give you the chance to make personal and professional connections with other members. And for some forty thousand people worldwide the answer is plainly Yes.

On the other hand, membership has been dropping. ASQ does not formally advertise membership totals, but Google estimates the following numbers overall:

• In the 1990’s: 136,000 members
• In the early 2000s: 100,000 members
• In 2010: 80,000 members
• In 2020: 52,456 members
• In 2024: 40,000+ members

Was this decline caused by the controversies over ASQ management? There is no way to know. All we can say is that it is consistent with what we might expect if members were unhappy with the direction the society's management had taken, but did not think they had the means to change it. But there could be any number of other causes as well. And, as Quality professionals, we know better than to jump to conclusions.

In the end, I stand by my argument that Quality matters in management. Yes, it is always possible for someone to mistreat his employees in the short run and still get some kind of results. But in the long run, such a system will get brittle and sluggish and fall apart. It's the same thing in the market: in the short term, a fast-talking shyster might fleece a few people out of their cash by selling them the Brooklyn Bridge, or gold-painted rocks. But it never lasts. 

__________

* Yes, this counts as "foreshadowing."

** By a remarkable coincidence, the update came shortly after I published this blog post here.

*** "Collective farmers were allowed to cultivate small plots of land and sell surplus produce in private markets. These private plots, though only about 3% of all farmland, produced a quarter of the country's agricultural output." See this article, "How Did the Soviet Economic System Affect Consumer Goods?" by Andrew Ancheta, Investopedia, September 09, 2023.     

      

Quality in management

Last week, I raised the question whether Quality has anything to say about how an organization manages its people and resources internally. To ground the discussion in a concrete example, I referenced a dispute that is currently under way inside the American Society for Quality (ASQ) about funding and budgetary priorities; but honestly I could have picked any number of other companies instead. There's nothing special about the ASQ controversy. From my point of view, really, there were only two benefits to writing about this example: first, I'm a member of ASQ so I happen to know about it (because the topic is unfolding around me in real time); and second, the critical details are already available in public so I could discuss them without violating anyone's confidentiality. (If you check last week's article, you will find footnotes with URL links for all of the substantive data.)

Remember the real question

On the other hand, it's never very useful just to write that "XYZ Corp. did a bad thing." What are the rest of us supposed to do with that? The useful thing is to write information that we can take back to improve our own work. And that brings us back to the original question: Does Quality have anything to say about how an organization manages its people and resources internally?

Last week I took the wrong approach, by checking what ISO 9000:2015 says in the Quality Management Principles. Oh, the information in there is sound enough! But it's all just recommendations, and it's mostly stuff we've heard before. So it's easy to imagine someone in an organization's management saying: 

Look, I believe in providing Quality to our customers. But when it comes to all that talk about "internal transparency" and "treating your employees with respect," I just don't have the time. I want to Ship Product and Make Money; and all that touchy-feely stuff about employee relations and being a Nice Guy—that's all a luxury. Get to work and get your job done. End of story!

Is he wrong?

Getting to work is fine, but he's wrong to call human relations a luxury. But ISO 9000 isn't the best place to see it. Let's back up and remember what Quality is about.

The Quality perspective

Quality means getting what you want, but there are a lot of ways to do that. Critically, Quality is not built in the abstract from a set of axioms or natural laws: there's no set of rules that unfailingly give you Quality. If anything, Quality is more like a giant Lessons Learned exercise, where we cobble together useful techniques by analyzing one failure after another and figuring out what it takes to make sure those failures never happen again. But since there are many different kinds of failures, there are many different Quality techniques—so many that it can be hard to summarize them all.

Still, there are general points that they all have in common. One of them is that if you want some assembly (like a tractor or a stamping machine) to continue to work well, you have to understand the components that go into it and how they are assembled. What kinds of failures are normal for these components? Does this material rust or corrode? Does that material bend or warp? Do these gears need regular cleaning and oiling, or is it better to leave them alone? All of these are normal questions that any Quality Technician responsible for a large machine would consider on a daily basis.

And here is the critical point. The organization itself is a kind of large machine, and its components are human beings! Quality requires that we understand the failure modes of our machines, to prevent breakdowns. Therefore Quality also requires that we understand the failure modes of our fellow human beings, to prevent organizational dysfunction. 

Failure modes

What do we know about human beings, that relates to their possible failure modes in organizations? We know a lot, and there's no way I can summarize it all in a single blog post. But let me list a few facts that I hope we can agree on.

• People are capable of free will.
• People are capable of independent judgement.
• People are capable of rational thought.
• People work together naturally in groups.
• People want to feel respected, and are sensitive to slights. (See research on disrespect, e.g. here.)
• People are, on the whole, more fearful of loss than covetous of gain. (See, e.g., the research on Loss aversion.)

Already, even these six points entail consequences for the management of any organization.

• Because people have free will, they must (at some level) want to be part of an organization, or they will simply walk away. (I discuss this point in more detail in this post back in the spring.)
• Because people have independent judgement, they choose whether to stay with your organization based on their own criteria, and not yours. In fact, different members of the organization might have different criteria from each other.
• Because people are capable of rational thought, you can give them reasons to stay with your organization and expect them to listen. But the reasons you give them should make sense. Also, because people can see with their own eyes, the reasons you give them should match what they can see for themselves—i.e., the reasons should be true. If you give your people reasons that are visibly false, the risk is that they will stop believing you even if you later tell the truth. Also, as I have discussed before, the easiest way to make people think that something is the case is to make sure it really is the case.
• 
  Because people work together naturally in groups—Aristotle called us "πολιτικὰ ζῷα" or "political animals" [Politics 1.1253a]—your people probably want to work for you, by default. And people regularly accept some kind of authority over their work, without chafing at it. But they will not accept just whatever authority you feel like exercising. While a willingness to work together is natural, so is the deep-seated expectation of justice. It is true that people sometimes disagree around the edges about what constitutes justice. But nobody who has a choice will remain part of a community without it.
• Because people are sensitive to loss, be careful before you take things away from them. Of course sometimes you have no choice. Sometimes there are good reasons. But in that case, it is important to counter-balance the loss by giving them something else in exchange. At the very least, you have to explain what you are doing and why. This shows them respect (and people want respect); it also offers them the truth (and people want the truth).

Notice what this means. I have not said one word about Being a Nice Guy. But a small collection of known facts about human behavior (and human failure modes) has already shown us that—if we want to prevent the organizational machine from breaking down—management has got to offer the rank and file respect, truth, transparency, and justice.

This isn't soft-heartedness or soft-headedness. This is just preventive maintenance. And preventive maintenance is one of the fundamental Quality disciplines.

If you are interested, I can use next week's post to review how ASQ has handled its current controversy, in light of these points. Let me know what you think.       

       

Does Quality require shared sacrifice?

We usually think about Quality as one aspect of an organization's interactions with its customers. To the extent that we discuss internal behavior, we usually talk about behavior that has an effect on the customer experience: error-proofing, for example; or calibration; or lessons learned.

But does Quality have anything to say about budget management? What would that mean? Let me start with an example.

Once upon a time, I worked for a company that had several offices across the United States. And we hit hard times. (Since most of my career was in tech, I got pretty familiar over the years with the alternation of boom and bust.) To help us weather those hard times, an announcement came out one day that all of us in the rank-and-file were going to be put on 80% salary. We were told explicitly, "Just work four days a week, because that's all we can pay you for."

But that was only half the message. In the same announcement, we learned that:

• the Regional President had cut his own compensation to ZERO for the duration of the emergency. No salary, no bonus. Nothing.
• the rest of Senior Management got to keep their salaries, but their bonuses had been cut for the year. (And for people at that level, the bonuses represented a large fraction of their total compensation.)

In other words: however hard the austerity measures were going to pinch us, they were going to pinch Senior Management too. The message was clear that we were all in this together. So everybody pitched in, nobody grumbled, and after a while things turned around so we could go back to normal.

It's a great story, and the best part is that it really happened. But of course stories like this aren't exactly common. And I found myself reflecting on it as I considered some recent news from the Board of Directors of ASQ (American Society for Quality).

ASQ and hard times

In principle, ASQ is a volunteer organization. That is, there are a number of administrative roles at Headquarters (and perhaps other places) but the bulk of the work is carried out by unpaid volunteers. 

The Society is divided into geographically-based Sections, so that people who live in a common area can get together, get to know each other, and do things in common. The idea is that social interaction can be useful professionally, but also it's just a nice thing to do.

There are also annual membership dues. These dues cover the overall Society activities, and a fraction of each member's dues goes to that member's Section to help pay for local Section activities.

The fraction of annual dues allocated to a member's local Section is sometimes adjusted, but lately has been hovering right around 6.5%. (That's six-and-a-half percent, not sixty-five.) The remaining 94+% goes to the central organization.

But not this year. The money is normally disbursed quarterly. According to the "Member Unit Financial Management and Reporting" policy approved 2021-11-12, clause 5.1(g), "Dues allocations will be paid quarterly during the year and as soon as practical after the start of each quarter but not later than 30 days after the start of the quarter." In fact, though, Q1 2025 came and went with no sign of the quarterly disbursements. Finally on April 16, we received a communication from the Board of Directors that the Q1 dues allocations would not be distributed.* The explanation was that all our dues allocations had been invested in the stock market; and with the start of a new Administration in Washington DC, the stock market was behaving erratically.

Then on August 4, the Board of Directors announced that they won't distribute any dues to the local Sections for Q2 or Q3 either.** This time the explanation was that they simply couldn't afford to make the payments. ASQ's deficits are too high, and the budget is stretched too thin.

Where's the money going instead? 

The Board announcement explained that ASQ is now rolling out a members-only AI tool called Quincy, "offering members 24/7 access to expert insights, tailored recommendations, and ASQ’s extensive content library at your fingertips." (I guess the Board hasn't been following the recent news about how likely AI is to hallucinate answers to technical questions.) 

Also they've been putting a lot more money into the members' website, "which recently received the Community of the Year award from Higher Logic." [I had to look up who Higher Logic is, but I guess this is a big deal for people who know.]

And of course there are the administrative salaries. The Board announcement told us in tones of alarm that over the last three years distributions to the local Sections worldwide had totalled some $850,000 per year. That sounds like a lot of money. 

• But in 2022, Catherine Jordan (ASQ's outgoing CEO) took home $539,594 in total compensation; while Siddhartha Bhatnagar (the incoming CEO) took home $306,784.*** (Overall total for 2022: $846,378.) 
• In 2023, the numbers were a little more modest: Bhatnagar's total compensation had risen to $415,573, while Jordan's had dropped to only $325,110.**** (Overall total for 2023: $740,683.)

I have no more recent information. But if someone asked me where ASQ could find an extra seven- or eight-hundred thousand dollars a year to keep supporting the local Sections, ... gosh, I think about my experience with that earlier employer (where the CEO cut his own compensation to zero) and the arithmetic looks simple and compelling.

Of course, maybe the Board already had the same idea. Maybe our CEO is currently serving for a dollar a year, or less. I don't remember seeing an announcement, but I might have missed it.

So I asked. I emailed ASQ Component Relations a week ago, asking about any announcement on the subject. Just this morning I finally got a reply that said "ASQ does not share information regarding staffing and/or staff compensation." I wish I were surprised.  

In their defense

I had better clarify a couple of points that make this situation different from the one I started with.

Because ASQ is (largely) a volunteer organization, the dues allocations which have been stopped did not constitute anyone's personal salary. Nobody was relying on this money to pay groceries or rent. 

Many Sections had built up savings over the years. Those with no savings who needed money for an event were encouraged to ask their Regional Director for a special emergency allocation.

And Sections are allowed to raise money on their own (within certain limits). There's nothing to stop a Section from offering a dinner event and then selling tickets to cover it. 

What about Quality?    

With all that said, what does this have to do with Quality? Even if we assume the worst about the current state of ASQ executive pay, does the Quality discipline have anything to say about it?

Yes, but it's indirect. In ISO 9001:2015, pretty much the only clause with any relevance at all is 5.1.1(e) which requires: "Top management shall demonstrate leadership ... by ensuring that the resources needed for the quality management system are available." (ASQ management can probably argue they have done that, by telling us to use our savings and offering special allocations where needed.)

ISO 9000:2015 has a little more to say. I'm thinking of the seven Quality Management Principles that we discussed last spring, particularly the principles of Leadership and Engagement of people.

Recommended actions under the heading of Leadership include (clause 2.3.2.4):

• create and sustain shared values, fairness and ethical models for behaviour at all levels of the organization;
• establish a culture of trust and integrity; ...
• ensure that leaders at all levels are positive examples to people in the organization. [All emphasis is mine.]

Recommended actions under the heading of Engagement of people include (clause 2.3.3.4):

• communicate with people to promote understanding of the importance of their individual contribution; 
• promote collaboration throughout the organization; ...
• conduct surveys to assess people’s satisfaction, communicate the results and take appropriate actions.

These are suggestions, not requirements. And for the most part they are written so generally that it is hard to tell what actions satisfy them. (The very last point about surveys can be objectively assessed, but the others are a lot less solid.) Nonetheless, I think they all point to establishing a kind of common interest between leaders and led, a sense that we are all in the same boat. It may in fact not be possible to describe this kind of common interest strictly in terms that can be supported by objective evidence, but I want to say that most of us know it when we see it—and that most of the time we probably agree with each other's assessments (positive or negative).*****  

Using that kind of criterion, the company that I described at the beginning of this post had clearly implemented the Quality principles of Leadership and Engagement of people. For ASQ, perhaps the best we can say is that an affirmative answer to the same question is not obvious without more data.  

What do you think?

Since the formal standards are so vague, what do you think? 

• Does a commitment to Quality require shared sacrifice? 
• When hard times pinch, should top management make it a point to be visibly squeezed as hard as the rank and file? 
• Why does it matter, or why does it not? 
• Finally, what do you wish I had said in this essay, that I failed to say?

Leave me your remarks in the comments.

__________

* See, e.g., this LinkedIn post.  

** See, e.g., this LinkedIn post.

*** Source: ASQ's 2022 IRS form 990, publicized by Dan Burrows in this LinkedIn post. Of course these numbers don't count salaries for other positions, or any other administrative expenses.  

**** Source: ProPublica Nonprofit Explorer website. Again, these numbers don't count salaries for other positions, or any other administrative expenses.    

***** Even back in the Middle Ages, the justification for compensating kings and nobles and knights so much better than peasants was always that when danger threatened, the kings and nobles and knights put themselves at risk to protect their people.