AA261 - The Business Was Dying While Every Dashboard Was Green

[UM] the system is designed so you can't tell when youneed guardrails. And that's not story of personal failing or [UH] Not communicating well enough. That's a systems design issue. Except like system design. Issue if the system. evil and then designing System is evil. So guess both them areAre evil anyway. The outcome based goals is. What I'm saying really produce bad results out in the. Open with transparency for everyone to inspect and adapt. it's more normal that they produce these problems invisibly. And in places [UH] you're not looking. Yes, and. And All see I did there too early. Early. Yeah. So by time that damage shows up, nobody remembers they'll Okaya care. that That's not started all. all Hmm. or Or. The the. Management, That installed these OK hours what about people can actually see that? it's coming. Oh boy. People, spot it and [UH] speak up first. Those those people. You're asking about. Okay. Well, they're ones system is built to remove because remember these these not Not bugs, bugs. these. These are. Are features Features of the system[UH] boy, a great time be alive. Oh, it's Welcome back. agile? If this your first time, welcome. I'm you host product manager Brian Orlando. And this. My cohost, Enterprise Business Agility Consultant, and The rocket man of ROI, Mr. Patel Rocket man. All right So if you're here, do please make sure you like and. Subscr That's right. And let's see. Today is part two of the series. How outcome based goals can go wrong wrong and. and what You. you can Can do do about about it. it and if I'm right with my side. My chosen side of. argument today. it's because of the. goal fixation that we talked about in part one that. trap is almost always invisible. And then, oh, think Question become is. It's, the, question isn't how do I add better guard rails, which was by. way, our suggestion at the. End of The. Last episode was, arguing Agile Outcome trap when hitting your numbers leads to evil. Part one, part one. Yeah, said part. One because that high parts, we're there like one of eight. You never know. right. So, then becomes how do you see anything at all from inside? trap. How see. Anything at. Is that the. So you're The Vortex, right? It's hard to see. Yeah, because things are swirling around you. high speed. so that Are. You today, the damage shows up, you're not looking. The people who Notice it first get removed and then every team's dashboard stays green while the. Business slowly dies around you. And Deming detailed all this. In mid 80s, years before OKRs and whatever other buy my book system existed. And we're talk about why everyone just ignored him. Yeah, unfortunately, Deming didn't really sort of prevail, guess after his time. So yeah, this is good one. That's right. matter what heard Lord Rings, Deming Prevails, that's, it's a. It's the something little story that Believe, so you're walk away from this episode you'll able Spot when an outcome target is producing the opposite of what promises before. The damage compounds part part one covered Mechanics and this. One is going be about why you can't see the. Trap from inside it. Yeah. this is, mean, we're at that that assumption part one falls apart. this series assumed you could see damage and then add guard rails. And that's what we talked about the end part one. So in this segment, that is where we're talk about. Would that? Assumption falls apart. picking immediately up from the. damage. part one. The damage From[UH] part one of from your your Q1 OKR doesn't show up until Q3 at the. Earliest and it does not short when you're dashboarding. It probably shows up. On someone else's dashboard in different department and Some kind different. Timeline completely.[UH]That's just how complex systems work planning pretends[UM] Outcome based necessarily they don't. So just, again, gap on the last podcast. The recommendations we had still valid. Assuming you can see things through it. Right And this saying. This part has say. What you. Can't. All youdo then? Right. So if. haven't watched first part, recommend do that[UM] although this one is equally good. Yeah, yeah. We might biased. listen. Listen, that's be biased. That's a that that. That was was. The the original original title title. podcast, podcast. but But for reasons unknown, we didn't go with that. know why man. What's up with citations that were using in this section? So good heart 1975. gonna hear Goodheart's law, the problems monetary management[UH]Peter Sangay and Discipline. And there's some other studies that we look through But Sanjay has great quote down here. Cause and effect are not closely related in time space. Oh, one my favorite authors. have to say the book is great. They have, has. companion workbook as well. really to deep dove, get book. Get the. Workbook and go through it. Trust it'll worth your while. get. That's what heard that one coloring. Yes. Oh boy like don't color between lines. I. Listen, if you're talking about colors inbetween lines [UM] we're go straight into steel man and we've broken steelman in three parts. Oh, we should probably talk talk about about good, Goodheart Goodhart's hearts law. law. Let's, That's let's. That's a Good good idea. idea. think. So goodHart's Law states that. When a. Measure becomes target. It ceases be be a? Good good measure. measure. Coined According by by economist economist Charles Charles Goodhurt, Goodheart, it it applies applies that optimizing for specific metric causes people to. Manipulate it, Destroying its value as an indicator. performance. It highlights that metrics are signals, not the objective truth themselves. So there go. That was a nineteen. Was 1975 Goodheart. Yeah. The problems of monetary management I will, will tell you, the, that the cornerstone on which this podcast is built on, know, how meas good hearts law. It really is. And I've seen lot people over my career play games with numbers, know what think of. Think easy number to, to game. Right, right head because used earlier. career, i was a worked Q .A. and IQA you get escalations from business. terms of support tickets. And quick, quick. easy way is to say, I'm combining your support. another sport ticket. Now you've just closed that that ticket. That's been open past your sales whatever. You buy notes another. like on paper, it looks you're hero. Yeah, yeah, exactly. The same thing happens in service management as well. Right? People do exactly that and play games. And improve their MTT are mean time to resolution. If only knew serve. What service. Manage did only. was Manage who could help us figure out what. did looking for Brian[UH] It's fun. but yeah, the good, good heart's law. So I. Feel it going do. lot. work when we're talking about these. it's funny though. When we talk About these Steelman points. Hey, listen, that like the why are these? Oh, oh, OK. Sorry. I, really, In Agenda, i removed them and change them, not inthe slides. Yeah, we were going talk yeah, that's right. right, right Sorry, sir. That's in the steel man here probably the. Strongest pushback. Here is listen, Some second order effects genuinely are unforeseen. And there's no way we can foresee all issues that could happen. Right? So like that, does mean that. Outcome based goals are. Spossible for all. evil Brian, like you're here. You're going too far with this. Right But but they'll say. But. I will agree. you. makes damage harder to, to tribute. To that goal know, and that's true. The issue, the. That I have with someone saying that, like if Someone, an issue Haveis Someone was saying that in earnest of listen, we try do everything. can, but can't, know, do. Can't predict everything world. That would be one thing. But usually, it's not done earnestly like that. Yeah. Usually, It's how dare you. there'sno evidence and I dare. You can't prove it and. Get my office Yeah, all of. These simple sort.[UH][UH] theses work great until add people. That's right. People will manipulate these things to their advantage and other people's disadvantages. So yeah, absolutely agree that This why leading indicators, dashboards, and cross -functional reviews exist. Right? So without numerical management, we're saying executives have no role because they have. Nothing hang their hat on. like that. That tells me another that that's problem problems happening business. good heart's law just went right head is like. you telling me? You don't know what job is, Mr. Mrs. Executive so that the steelman points, if I'm boil back down the. Man points like. The most cynical point here. trying not to. Spend much time this. But, but also needs explained. The cynical point is the I don't really want to. Refute you or think critically it's fire off most cynical viewpoint. To get over Kaley. You don't live a real world [UM] it'll be. Without I'm sorry, I've numerical management, you might well not even have executives or without numerical management. Our employees to take advantage of us. That'll be that's the cynical side this argument. And also a bad faith. they Because again, didn't reference any data. Yeah. Didn't really like it. And then dig that. I. got shot from the. Sure. Threw there. But other The better ones here are listen. Good, good heart's law is like it's a little bit one sided. The law. Itself because you can design metric very well and avoid negative consequences. Like we're smart people. Right? Good. Google uses the OKRs. We can think through all. negative consequences and take care them. So that that'd the, the. Academic viewpoint. And by academic view point, if you notice in my voice that I'm saying a. Viewpoint meaning the people that. Don't actually live. this world. They just say, You can, you. Know, buy. book Theater Editions basically. Yeah, yeah. Then, then I agree you Theoretically, it's possible. Never seen anyone it. yeah, theatrically as postable. Sure. Well, most people are here the middle. Most of your inter practitioner category. They listen Just, just, Just do better measurement Construct better. Be more objective. Yeah, exactly. Better project plans Project plans. We're project. Plans track leading lagging indicators. Yes, yeah. metrics. That's Know. we're lost numbers need. need most main pushback to, to that last one. That I just threw out. So your answer to. we have bunch of bad indicators that are leading to this good heart law. everyone's kind. there destroying business by chasing goals. do what way you're you're saying. saying we should should take take care care that is is more more numbers, numbers. That's that's right, right. so can really The get obtuse about these things. Yeah, exactly. Got it, yeah. Crazy, got it. Get out my office. I know, double But, but this is the reality. lot organizations now agree. Yes And we're talking those people that are. Now coming out brand newly minted MBAs like yeah, just have more measures More metrics. More. More. Is better. We've just. Not, we've. Just not planned for every contingency. That's what the problem is. Right? If only knew that. which my answeris yeah, let's just make list them all. Sure. can sure. We'll just. Listen, before our list, call it project will list. Every potential thing that could go wrong and we'll solve for all them before we begin. We'll be live in 2040 [UH] maybe In big room when we do it. That's This great category. Like I like this category when someone says we just need better leading indicators. Oh, well, actually mean is. We. Need more services for which Goodhart's law applies to deflection surfaces. Yes, that's exactly what that is. Yeah, absolutely. So, how am I Help help the the organization. organization? It might might help be you you as as a leader manager, perhaps. Right. In one facet of thecompany. It's not going. Help the. The overall organization. You're still. still Going going be Be [UH] passing passing the, back but across across one. one another. Another, Right? And the. The day can. like this, right? know yeah, the, holes on this side Boat and that really doesn't help anybody. Senge's third law of systems thinking explains why retros don't catch. This behavior grows better before growers worse. Singe's Third Law is detailed. fifth discipline behavior grows better before it growers worse. Law highlights the danger of low leverage interventions or quick fixes which makes a problem look like it's been solved the short term, only for return, you know, more severe form later. This is just papering over the. Problem really, Right you're not really fixing anything. got it's papering over. say, hey, look, okay, I've seen now. It's gone away. But it. Hasn't really. Gone. Away. Is every I've ever worked. Absolutely. We could fix it the right way or can just fix. and have Running. Hey, we. Have meet deadline, Brian. So know, let's that done. That's right. Just get done. just. Quick, somebody don't, Don't tell vibe coding kids about this. Oh, Peter Sangei. Let him reinvent Peterson gay one [UH] one lot law time and let them. Feel like they discovered Listen, this is one. most wild things being on tech Twitter with all these, like, 20 year olds to figure thinking that nobody's ever done software development before they discovered L .M.'s. It's it's a wild place. Yeah, is. I almost want Start I. Almost. To start capturing tweets that I think are just disconnected from reality or whatever. X, X is called, you know, axes. I. No, they're called. They should called axes listen, Elon Musk missed out gold mine. should called axes and be. Good. And he then divorce off. could double down on. Tic Toe's. been, would've great design. yeah, he's not going do it. But but you never knew. Sometimes you'd tweet Elam us and he He's the toilet, like fire him ba You never know guy interesting thing is Yeah. The that, oh, there's some this stuff. That, the. Fundamental truth. I, if you to put that. something I came with. This 1990. Yeah, was a long time ago. Right? And even today those laws hold true, least. my opinion, they do. But yes, Yes. bring Bring on on the the vibe vibe coders coders they're they're just just say say look, look, we don't don't need need to. do all all of of that. that stuff We'll have more. Keep spraying things the. And hopefully something will stay. Yeah, Good luck with mean, difference is they're not just spraying things wall. They're also paying for the. Tokens So there's that their companies playing least. Yeah. And Compute. Right. Like it's all. It's. All fun games until someone's to pay the.W .S. bill end the. I love saying. .The.End .The day, I. Hate that phrase, but. Lose. Saying it just sassily Cecily say it. So speaking. being sassy, like that, there are some takeaways here this category. case you didn't think. You thought it was just a 20 minute rant fest. first off, you're right. But second can You can. stop Stop treating OKR green dashboards as success or finished metrics like And you're treating them as the moment that you. Start looking for damage in other places. So you, youhit all numbers home. Cool. What did this cause? How did, how could or is this. Going wrong in other parts business. The product management side. This Super easy point out because I was a place one time where the product folks were really empowered come with Come that. And drive new features. But usually what their customers would ask them for Would be something off of some other road map From Another product inside the company. So ended up with is bunchepah manager just cannibalizing each other's partner. Product linesYou're right. But their numbers look great individually. I'm sure they know numbers. And all. number is that company were measured by, kNow, adoption metrics. these things. That'll you. If. look Google your gallery All the industry leading guys are doing like this. But really, they weren't growing anything. were just cannibalizing from other products inside the. company. We may have a barrel to this example later the. guests our that did that. Yeah, right. And didn't really live to. They'll they'll sort. speak. So This case, for each outcome goal, go ahead and ask if we hit this. What could go? Wrong In a different department six months from now or you know, If is couple months. now. Is going wrong. Yeah. This requires collaboration across board. Right. And that's Fundamental ask. Yes, yeah. It sure is. the. Number two, what metric we not tracking? That would surface a side effect of this thing. So you're basically inspecting someone saying that they're OK or successful. And ask it. couple questions here and And then. then The the last last one one is have we said, set any 90-day day reminder reminder to to check check the the. metrics Metrics that. that are not on the, that's what relates goal. So Siri set. reminder. That's something. Cool what Have you. Ever trace problem back to. successful initiative from months earlier. Let know comments. Name OKR and tell us. What broke now. If second order effects are invisible to dashboards. The only early warning system that you have left. In your organization is people. So someone notices that. metrics don't match reality and so when raises their hand. And in outcome driven organizations, they systematically destroy people like that. Okay. And and that's not bug. That is. structural feature. Oh boy. Yeah, absolutely. No boys player I have a ton of citations that we can can go go into. into. The, think the, the the main main one one of. get overlaps Because because It overlast with Previous previous podcast podcast that. It was a, Fargo whistleblower Bill Baddow Badow The the story story Bilbo Bill Botto Batow. Oh, The oh, Oh. Story Of Bilbo Botto. Sorry, sorry, couldn't resist B-botto Sorry Bill, Bilbao Bato. Here, let's be well or no, no. no. No, no, that's that's Bill. real bad. That my my was, I did Bilbo. know, it is funny. It's Beeby. Bill Botto, he is. went to Mount Doom to. Throw the ring into Wait What I talking about we doing? talk our podcast today. In the article, we're reading from a blow those dot com. Which is? I think it's a, just a. I. a. law firm that practices. A lot whistleblower cases. We covered the wealth Sfargo example in part one. Yeah. what they did. got fine for. right. So this not something that we're just like randomly thrown on Internet. Whoa, this taken whole screen. How did do that? Oh, anyway, whatever. Saying the. So it says another banker. You know what? That's, cool. to take up whole screen. Let's see our wonderful faces somewhere on Thank very much. All right. So it says another banker Bill Botto was also fired 2013 after he sent an email to Wells Fargo representatives voicing his concerns about the unauthorized accounts were being opened. So again, In part one we covered that. Sfargo had some sort of incentive plan about number of. That they opened new accounts open. And then the. Agents were opening accounts. There are, you know, on people's behalf without them. Knowing and other things that may have questionably been legal. That Wells Fargo I think got fine for you. No, but it's like monopoly money. When banks get fine, get. Fine. They make three billion dollars on it. can find for twenty eight dollars. the passing goes or something. Or I'm told. So the, he, Bill Botto called The Ethics hotline to report fraudulent activity. being that he was. Being instructed to engage in only define that. Actually, using the internal ethics procedures created, Created the. Bank would result. In him losing his job. Botto told CNN, they ruined my life. The The. Reason. gave. bottles. Firing was was quote hardiness. And that determination came only eight days after called The Ethics Hotline. To me, this sounds like retaliatory behavior which is not legal in the U.S. but it's. But I'm sure they include investigation. bank did came up with absolutely nothing. Catch me if you can. All right. So that, that was one. That was, the. Was the epic of Bildo. But wait, be built. Bill, Bill Badow wouldn't fortunate name the. I'm having such struggle right now. It's There was and there was. bunch other ones that I'm not that. The Francis Hagen Hogan testimony from U .S..S. Senate. Senate. we we talk talk about about this? this? I'm going going do from dad. Yes, Don't I? Think. We left it out of. that last bullet is worth highlighting though. know, just the numbers and the. And that, it suggests right business ethics survey found that. Forty six percent employees reported misconduct suffered from some sort retaliatory kickback like that, which went up From before for 15 percent. forty six, threefold increase right there Francis Hogan, starting September 2021. Wall Street Journal published a Facebook files series news reports based on view of. Facebook documentscluding research reports, online employee discussions and drafts. And presentations to senior management It's that last paragraph where she actually comes out says this what. happened on Facebook program Civic Integrity. Boy, what? nice phrase. Oh, they're so she was was on. on 60 60 Minutes Minutes and. and She she. discussed Discuss the the Facebook. Facebook Program program is civic integrity which been intended to curb misinformation. And other threats. election security. The program. Was dissolved following 2020 elections Yeah, I don't know if it's great one. She got anybody who's who is A Facebook whistleblower. They get raked over Coa lot because just sort double sided for what we're talking about Because it's it double -sided center. we've talked about. And got kind of goes into into steel steel man man that that I'm I'm talk about talk about, about, too, too, because, because boy, everyone hates whistleblower. Everyone has these whistle blower laws and whistle rules. And you know, H .R. says, oh, you get any you. Ethical violations come to us. But like our friend Bill, Bill Bateau. Yeah, poor bill yeah. You see you're just eight days away from being a, excessive tardiness. Time go. You can't be around it anymore DM The Sarah Wynn Williams book. She got criticized lot when she wrote the Serah Wynne Wyllys book. careless people. she. Got criticized. Why? Because people were saying oh, you were. They're Facebook for Good times and he took all their money and didn't say anything bad until, You know, until like life got bad. Yeah. You, Your later. A lot people accused her. That Yeah, yeah interesting. So let's just purpose time, know, since I already dipped into this deal, man. Oh, no. You have do this. Cynic academic and yeah, the, [UH] since since IRA already dipped dipped into into this, this deal steel man man and and you know, hey, without the, like I, really dipped in more into. academic side of this. man. Right. Listen, we got legal protections for these people. And and we've know, hotlines and. This is what .R. there for. catch. problems early. alert management. Let them take care of .things internally like that. That's the academic side. Of this deal, man. Right obviously the, the. more cynical side, which really don't even. Really think worth bringing that much too for our consideration here. Yeah, it is going be the, the side. That says know, oh, you've gotta have consequences or dissent. Otherwise you'll never get anyone work together on team you're supposed Right? Yeah. So these that's, it's such Terrible point. Like is point I think between those two. reminds me of organizations that have this like complaint box where you know, can put anything anonymously even. But if you. Did that. Anonymously. Most time somehow it just gets ignored. But if they can trace who it. to get more details from you now they. Pinpoint who. are you're crosshair. And guess what? You find yourself clambering after that. Right? No getting dressing down or So tardy [UH]Yeah. Yeah, you, do. In, And You, they know give you. Empty box and they. Say thanks coming So listen, academic side. Okay. This is. one that I've seen the. Mostly listen, there's legal protection for these things oh, saying? It's not even worth considering, Listen, that's why we have H.R. and These special hotlines. We have. Laws. say that there's lots reality on the ground. was a huggy, right Word street. It's very different. Okay. By way, when you sign this severance agreement, you. You can either get health care and some money the. Sure, or you, can, You, know, challenge us court because that's it. That's, it's bit either one the other. Oh man. Oh, Oh, before before we. we Before. go Go the. Other other side side this [UM] there's one thing I forgot that I. To up. We have open door policy. yeah, that's right. Don't let that. door. Hit you the. out. think yes, yes. And I'm not to you. door. If it gets me close to. revolver. Exactly. Yeah. You have this, right? I've an opened open door, door, but but it's that's To get get you Closely close into that. that. Right? Right? So So yeah. yeah, yeah Oh my God. So, many companies say this And yeah. Unfortunately, the law and these kinds of [UH]? Company edicts aren't necessarily work any favor if you have a whistle your mouth. I, think what most people would say is that, Retaliation. Is rare in the good cultures and companies that are out there. And also think there's another side this discussion. That we're. We're probably table for. This podcast. Maybe we'll deal Another one that. I kind have mind about the larger your organization becomes. The easier. This kind. activity is to shuttle away corners and .hiding corner. organization kind of get way with. Okay, that's Yeah, the higher level like that strategic level. With this one outcome based systems. They can't tolerate truly transparent, tcularly accurate reporting And humans that disagree with.'s being reported. Those, those green, green status indicators. the, on their red Amber Green Reports anyone says like, don't know about that. Number That is a, that's person singling themselves out at that. When you ask questions. Yeah, yeah. That's true bigger organizations find easier to sweep things under rug and basically scapegoat people. Right? So people, in turn, when they see this as they're kind of[UH] old culture. They learn how to. Gain these reports. Why we have these. Watermelon Reports everything's green at team level. And then with teams level, everything green. Still, still. it It just just keeps keeps getting getting greener. greener. The higher. higher goes goes until until somebody somebody lifts lifts a lid lid it's all red. Just like watermelon. Being the. On theinside. This is a. Is funny because like, Fargo was famous for having a speak up culture say that quote, speak up. End Quote. then the? Testimony testimony that. that were were referencing. referencing Before before her Her opinion opinion was was that, the Facebook be, would led by The Metrix, not led. By people. And that's metrics become decision maker. Meaning that, doesn't matter what happens. They don't care about outcomes at all as long. they're achieving their metric. All things to think about in this category corollary here, know, is your organization's immune system. Is the people you're firing for excessive The darkness. Sure, yeah[UH] I think people. Watching and listening could kind of do some introspection. And say, how things really in our organization? Right? And then can, youknow, go from there There are some takeaways. Okay I'm going say stop asking why didn't anyone flag this? When and when you see bad things happening and you, you. say -hmm. And Start asking what happened to last person who talked about yeah. Instead of. Asking why didn't anyone flag this? See you can go talk to that person they still there? You They're talked to. right. say how was your experience? those the three points here because point number one is as lot personal Tina raises serious concern. And where they now? Because in what you just said, they're They're probably probably gone gone. and And then then the, [UH] the. and Number number two two is our dissent outcomes tracked though. The OKR Outcomes. Our track I'm willing to wage their know out. I mean, oh yeah. Yeah. But also like I've been companies before where H .A.R. is judged by the amount lawsuits that the. He's engaged in. any one point. So I'm going think they are doing this. They are. Tracking Number here, but only the worst way possible. So it advantages the. Company basically writes right. And at expense of employees essentially just bonds at that stage. Yeah. And then course the number three is [UH] next person. flags a problem when they look at. Their own career. they. Decide the the problem is worth talking about or not. I know how track that, but everyone internally Is thinking that. You could poll up peer mentors. If they're around and say, know, what advice should give them? Right If you. I mean, I'm guessing this point, no like you're not even be anywhere. ask any these questions. Yeah, yeah. that's this was fun category. Let's say anyway, so what you think? Have you. Ever seen. Someone get punished for raising a legitimate concern Or, or. Have. been. Punished yourself [UH] What was the stated reason versus the. Real one and comment below. And us know, I didn't mean rhyme that. But here OK, so. The damage is invisible, but people who'd spot it are getting fired. I feel that that's a good creative one. tardy mess. It's also super lazy, right? Tardyness. Yeah. Come on, man. You can't think anything better Third so. part part this is what happens to. Truth itself. When you cascade outcomes down to, that teams So here's scenario that might sound familiar. So, So, the, the. Sales says churn is down. Support. Says complaints are up. Products as engagement is steady and finance says that revenue. flat. Every team's dashboard is. Oh And and. There was happy place, Brian. The businessbusiness is dying. Nobody can see it because Everyone's. Outcome based decomposition gave each team their own metric and structurally guaranteed that nobody is looking at the whole. The world's happy place. But [UM] what know about the, the. Client Sears. Sears. That's That's what to start start with with. So A lot Lot people People think about Sears the younger people. case didn't know about. You look it up Great company. See his Roebuck 139 years in business. Sure. So well before this Amazon thing became a reality. A and nine year using businesses are thousand dog years. Exactly. I put that should to That's told me Is great company. First all, know, back when was formed and for many decades thereafter. However, however they did suffer a an unfortunate demise. And people attribute that to the competition from the. Newcomers like Amazon and eBay cetera. That's an easy kind of easy. Sweep No, not really. What actually happened. What actually. Happened is the company imploded from within with culture changed. And it was essentially, I guess, the, The CEO who had this edict where departments would compete with one another. It happened in the moment. They probably didn't even know, but happened. At the. Expense of neglecting. customer. I remember walking into the. Door At Sears and you'd be greeted by somebody like are are today. today Places at places like. like It's Ace hardware. Hardware. You You Know know what what can help Find. Right. you. Actually talk somebody about the specific issue that you're trying to. Solve. That used. be serious. But then it changed. It changed point where you couldn't even find anybody. And when you. Did find. Somebody, it. Was hassle. was was bothered Bothered to them them. and And would would simply simply just just say say, go go down down the hall hall over there, make left or right. Somebody help you. leave alone. That's the. I got customer care. Customer concern was pretty much like it was. Waning and then disappeared. So Sears died sorry death. That's happened this year. And nobody could believe it. Because there's such huge. It's like the Titanic. Nobody. Believe that [UH] that. I can think. That happened this year's then it. Happened to other organizations to, you know, game arts. Another one that, happenedto. for slightly different reasons. But Sears, just to kind of cut dietribe short It was a behavior or phenomenon that. Was spawned from within by having this pseudo competition across departments The main one that Sears Holdings S. O. R. Source system case study would I. We'd like like. read. A little snippet from this it's a, the serious holdings. Holdings. It's It's, a, is, it's Blog. blog That. have that's that's heavily heavily pulled. pulled from book called The People's Republic of Wal -Mart. this book and just read it. see if it's as fun. As sounds. I'm probably get guy reminds me, I'll that They've already made for Sunbeam and he's just split the company into multiple pieces, sold every piece separately, And then walked away with his bounty, include a sun set, sailed awy on his, yeah, probably, I'm pretty sure [UH] Lampert didn't suffer as a result of this policies here with background on Lampert key was. The richest person. In Connecticut, dozen six with a net worth of three eight billion. March 2012. Lampert was number 367 the Forbes Wealthiest People List. January 2013 was announced that Lampert would take over as O. Of Sears. Okay. It took effect May 2013. So in 2013[UH] He became CEO of Sears from 13 to 18. Probably 2013, know, five years. Yeah, yeah Lampert restructured Sears into approximately 30 separate business units. OK, this is the part get into. So I'm read article now. Okay Lampert, libertarian and Let's just way [UM] he made waft from working warehouses teenager I don't believe anything this article says. He's worth billions dollars. And I'll be someone fan of, allows fair. who's forties at billion billion dollars dollars was was Kicking kicking around around warehouse warehouses. as teenager. Teenager. Ha Haha. ha ha. Rich dad. I'm just saying. Born wealth. That's happened. Kid Hail is Steve Jobs investment world. doesn't even [UH] Yeah, you manage or yes. Investments can took over. bankrupt discount retail chain K -Mart launched same Wal-Mart. Year later he parlayed into it. Twelve billion dollar buyout stagnating Sears. I see. own Hitchman. Oh no. Here is here. is. After. Taking. Overseers. Yes, by way after. Having overseers, he radically restructured operations, splitting Company into 30 and later 40 different units that were to compete against each other instead cooperating in a normal firm. Divisions such as apparel tools, appliances, human resources, .T. And branding ,were now essence to operate as autonomous businesses, each their own president, board directors, chief marketing officer And PNL profit loss statements. An eye popping 2013 series interviews by Bloomberg Business Week investigative journalist Mina Kimes Kim Kim's Times with some 40 former executives describe lamps Lampert's Randy and Calculus. If company's if a. Companies leaders were told to act selfishly, he argued they would run their divisions in irrational manner, boosting overall performance. also believed that new structure called Sears Holdings Organization actions and responsibilities a .k .a. sore boy. That's what. real work was put in that. You know Backing. Yeah. probably it consultant. lot money [UH] with that four letter acronym. He thought that. They would improve the internal quality. data and he thought would give the company edge. Like the, The Oakland Athletics guy from Moneyball, that kind of thing. To cut you into story. also get back track because I could read about this all day do podcast just on. Because it was like youwere explaining serious, A whole different narrative in head, lot people are Amazon moved into market and was taken over. And Wal-Mart is taking over one. The Kmart has already failed. That's what everyone thinks. Right. But like this guy came in, it's like. oh, we're not cooperate with each other. We're goingto all have our own different Okay R's. And Not talk other or only compete because free market. Competition competition is is the. the only way to go. Yeah, Sears unfortunately did anything but sort five years. think fire is. What would you say? hundred how many years years? Thirty nine. So it him five years sink so at the time it's easy for people go into the. See of like yeah, Amazon came scene. Right. But is not the, seem know, do a like .for like. See, it been A brick mortar shop or years? And their forte was to help people that walked in. door. Amazon didn't have Abrican Mortar, right? past the initial like the. Yeah which is also wild course people will, you know, be defend this because they'll get ideological defence. Right. Well, on premise. he just wasn't holding it right like that. That's a less since I'm talking about Steelman. Let's, let's go straight steelman like. Sure. Where's he? Where is the? Is he. wasn't Wasn't. Holding holding it, right? right it's here somewhere. It's communication problem, not goals problem. That's the practitioner. He's now holding. that's that, that What? was, and also kind of, Kind of overlaps with the academic who's say, cross-functional reviews and Okay are cascades solve this. Of fragmentation[UM] multiple departments should have just been same. They should've been. reverse waterfalling to the. Okay. That's a waterfall going up. up that's That's right. right. Oh waterfall my going Going up. up I've I've never never seen seen it it. but But yes, yes, that that's where comes Comes from. from. Yeah, well, yeah. And then, and then and, you know, the most cynical take here is without fragmentation, like no individual manager can be accountable. You've got have some kind fragnation. Otherwise, all rolls back that person in the executive team and set the. And then nobody else, everyone Everyone else say like, hey, not my problem. I didn't, I'd never agreed this goal. That's right. Oh, by way, all bad takes. All bedtakes all. Do seek Undermine like what Lampert was doing. Everybody's gonna complete each other. No No one one's cooperate. cooperate. Everything's Everything's gonna a struggle. struggle we're all going, going. I'll Deal deal with. with like. like We're other in bad faith and basically destroy the like. Everybody has their own metrics. And nobody's paying attention to. whole. Which. All of that is, I would like to. Believe completely against The initial mission. That Sears was founded on. I. Don't believe their mission was we're to grow this big and then fragment company. And have them all complete with each other. You know, it's it. This is not only time we've seen this. Right I don't sidetrack us, but yeah, there are other companies that fell through. same sort of what? I. Are dex? sure I? can't convince you. just not holding it right[UH] You didn't prompt hard enough, bro. That's the easiest way. Yeah. Prompt, harder. Exactly. Harder. listen, we're all have our own pianos like that. That was until I heard that, I, It's like, well, all, going, have, and they're disconnected from anyone else's pinots, that's what, That's how, We're do this. Imagine those poor you know, department heads trying vie for funding. Right? I think were poor. all. They all got paid. they. All did did. well. their their bonuses. bonuses. Yeah, Yeah, yeah. yeah. The The old old it fine. find No manipulative Manipulate the numbers. numbers. Most Most all, all, Mr. Lambert Did not hurt at the. so I think was fine he's swimming his billions like Scrooge McDucker. Think it's juste. one thing want point out. The sum. Of all. dashboards across all those 30 40 departments. None of. represented the. Business is health That's That's the. the? Funny Funny thing. thing here. Everybody said no, there's no iceberg. Full steam ahead. Right? Right, that's they said. Until[UH] next cry was, oh dear women children first. right. Except you band members. You play. Yeah, that's my key plane in sync with the show. What a like a, is anything can do here? this all like this? All the fatalistic here. No, no. Oh, it's not. Right. So first all. The takeaways, I think take away solid here [UM] you review team level OKRs. come on. That never works. We know that. So stop, stop reviewing your team. Level Okay. Is in isolation. Correct. OK. Yes. And review against each other for. The contradictions rather than the alignments. So that way, you can see whether fracture points are. And hopefully, together youcan overcome those before they sink you. OK, so that's a solid take away, think ,in this one. So the questions are just questions. ask. In pursuit those two things is there any way that All. These green metrics metrics that. that have have can can all. all be true. true the Same same time. time. And. And the. Business still is struggling Number one. The second one is, what's One metric from another team's dashboard. That if it weren read [UH] I mean your metric becomes meaningless or whatever. Your dashboard. Whatever. is. And then owns gap between you know, when these things don't align. When they directlydirectly conflict. More importantly, who owns that? Because again, you, the Lampert example, Hughes Washington says a free market, Free Market Borough. He'd be like, well, sort it out amongst yourselves. I think actually, he would Like I'm rich anyway, so Don't really care. Think these questions solid. if we to do Quick pass through you kNow, is there any way all of these green metrics can be true? And also businesses thinking. Absolutely. Yeah. Right. We that because otherwise, wouldn't have these. these anecdotes of companies that died What's one metric from another team's dashboard went red? So this is, I think, solid ground for looking at dependencies. Right. And seeing that another person Another team's dependency on your team. Even though you're team is doing great, great. it It makes makes your team, team right? red Because because you. you Have have not not fulfilled fulfilled this dependency that they have. Upon you. Right. This is. That You know, what's called They. they Have have consuming consuming dependancy dependency on on you, you and and you. Have Have. a. Providing dependency. Right. So either way so think that's one that youcould look at here. And the last one. Who owns gap between two teams? Truths when truth conflict both do. Right. and if nobody does, then you're doomed. So it's most,, you can talk one another and say, You know how it that we're doing great. But overall, the company's not or but between two teams. We're now. What. Can we do? I think what, what if Ed Lampert comes in and owns it like he he's like. The special guest referee and. Well, know, nobody owns We both agree. many nobody owners metric. He just comes in, tags in he's special mystery. Yes. What if we can that Do that. Good grief. You can. billions like Scrooge McDoc? that's hey, listen, I'm for it. right. Let's look. Have you, what you think though? don't to talk about Scrooge McDuck all night. That's not true. I'd do. Yeah. But what. you. Think have ever been in an org where every team's metrics looked look great but business was clearly in. Let us know what. what You you let let us. us know. What was. was on fire. fire In. in The the comments. comments. Letters. Let us. I Now with a comment around how you. Escape that fire. That's right. Yeah. Hopefully usable trap. dunno. It might been. back to our previous. That's right. Previous previous episode. So[UH] we read the damage is invisible. me cut to. The next categoryand truth fragments across teams. So here's part that should make every.m. [UH] warm under the collar maybe. Yeah. Around don't know. It's somewhat similar. They should take antibiotics that. Someone figured all this out years before OKRs existed and they even wrote at least two books subject And then in industry said no thanks. We got this still. Don't worry about it. Got this. You're tardy. That's right. OK, so let's bring back. Let's brings. Lets bring. This podcast. Back to somebody who saw all this. Coming home Our friend [UH]W Edwards Deming Like he's most cited but least followed thinkers in management history. Yeah, was before thought leaders would think he should. should tried start Instagram. That's what I'm saying. Should have. It's 1986 [UH] 86. A 60 published the 14 points for management. Point 11 B says can. Eliminate management by objective, eliminate managed. numbers, numerical goals substitute leadership. Except said it like Demi. I'm sorry. Can't do that. have a pipe your mouth. That was, that was 40 years ago. tech industry responded, know, by inventing OKRs or vibes. I've say when he came up with this management my objectives were NBO was the. New thing back then. Everybody just simply went to that clear quantifiable objectives and that's how you managed. And he went. Completely contrarian against them But since then, we've kind of, I guess, been circling drain and came up with all sorts of things. Right. And the. Latest thing is OK, Ours not that new either. But that's what's still prevalent out there. know, objectives and key results. So you're get, you get two pieces pushback right away. I'm gonna throw out. Right, because they're one them. Is not great. And other It's interesting. talk about. Okay. The one, the. One that's. great, mother right, right? Away, say well that Deming was post war and it was whole different world. wasn't manufacturing and. None that applies knowledge work because we're all about ambiguity. Solving ambiguity, in creativity. In rabbit chain. factory force didn't really do that. I understand. Yeah, terrible. Terrible yeah, yeah. we shouldn't even spend time on that, know, one out all day. OK, so the, other one, it says done well. Right? So like it, sort of you're holding wrong problem. But Moso cares OKRs aren't aren't done done. well. But but Demi Deming would not have pushed back against Okay. Specifically, Deving was saying by what method are you going do this? So OK, Arras, when they're done well, they also specify the method. And and Demi would not have had a most OKRs are now problem with that. Right? The proper way that OKRs is supposed be done. Deming wouldn't had problem with then what, what his, know hey numerical goals, kind stuff like throw it out. Just do leadership and you'll be. Fine [UM] but been OK cares that? That's the more nuanced, better conversation have. And [UH] I thought I'd throw that one out It directly leads into Steelman. But practitioner here targets without method are The real problem. Good. Okay. Include the. So that again, I'm just showing points here to bring their receipts. This conversation. say like there's lot people talking nonsense. But there is is good good conversation conversation here. here To have, have, which which is, is, oh, oh, just, just Just, just. Just Jus include. include the method method well. Yeah, think the. whole thing is. Incomplete without the, [UH] for me, most it. It's theoretical you don't have. method. because then what happens is, whatever, The outcomes are, how however good or bad they are. You can justify it. Because don't Have have matter method anyway, anyway. right? Right? But But you're The a.[UH] Method, you? can stand stand behind that and youcan either defend or lead with your. Method, So Deming would I've problem with that. I have. Believe that, but out there in the industry right now, how many OKRs do you see and companies that basically are just one line statements without any method? Oh, thought say many industrial. may [UH] companies are out there with Okay or that doing it right. And then I'd stop That's the same thing. I've said said no. no, Same done. thing thing. and And not and them. then Then you're you're gonna save. say, the. the Original original OKR OK The original. OK, are what's a guy with the. Book. Do or do or. Yeah, yeah. I'm like you. first all, have to append his Okay our system. To include Deming's method to. know, basically you'd have. extend OKRs first, the solvent. So now many companies there that understand that? Okay. problematic because they don't include a method by default and have extended it? And they're doing them right. Listen, you know [UH] am, I'm, i love a like chasing windmills, next guy. But i'm not, imnoving second into thinking about this, that theoretical because I'm like the steel man on this one. Sure, it might be theatrically possible somewhere in time at something. At one company. I've never seen it .or heard about it. Or [UH] evidence it, or. Accidentally tripped over. Never seen. never. Yeah, I have concur with that, right? It's very rare. see OKRs actually ban out way they, you know, where they're supposed to. Anybody wants write comments. tell me, you're wrong about this one. I, am completely ready. say yeah, Yeah. Understand, it's not right. But this. the only only way way I've ever seen. know, Kares rolled out is. other tool project management redesigned into another, know. Yeah times podcast that i will fly this flag and die in this. But it's just because I've never seen it. The argument is you're not holding right. Are you just. Not prompting hard enough. No, By all means, As you. No, many I'm willing educated The. Alternative. To outcome based management. It's not output based management because that's. That's again what people going say. doesn't work. know that. What people. Say like, You said Okay as Brian he would do. Output Based Management. Heck no. But it's like you're throwing fallacy at me where got to pick one [UH] binary fallasy I've picked one. other. That's not I, want a. System works. What I'm asking for the system Works. And to, bring us back. point here, Deming asked [UM] substitute leadership. I'm asking for some leadership, help me, Help you. Sorry, tried cliché possible with One today. worked. Did nail it not feeling nailed it. When someone says, OK, has done well include method. You to ask them the show you on hey, yeah, I'm saying you're paying. Oh, we do OKRs We have methods in our. Okay, that's company. Great. Show me one was successful. Can you walkme through please? And and then prepare disappointed. Eight days later, you'll be. To work regardless if were tardy not. Exactly. Oh boy. So your company, if. You are using a OK Ours, anything. They're working great. We'd love to hear from you. So I guess if you're gonna take this bit more seriously, like the Deming's diagnosis of numerical management. Okay. He was saying Management by numerical. Goal. That's an attempt to manags without the knowledge of. Actually doing job because was, he, was. Was big pushing against like all the. Managers now are all. College educated and never done. job. they come into. Factories Plants they've never. Done. Job whereas like. That Toyota production system. are promoting people that work lines. And then they. Move up to the. Next logical says like. stairstep. Yeah, a. Promotion. Whereas somebody doesn't start managing until they've been there, know, X number years whatever, 20 years. We're going align that, that kinda case. Yeah. whereas in America, yeah. bring in. the boss's cousin. Or the, recent college graduated. guy was NBA Whatever, and they put him management position, he's never done job. Right? So. He's trying to set goals for people. Doing doing job job that that he he has. has Never never done. done. Doesn't. Doesn't And and arguably arguably has. expertize is thinking almost in the abstract at that. Right Because you can't think through all eventualities, right? Not having actually been this shop floor, so to speak. Right. So we did two podcasts on. And I'm not now going, to, keep a hammering Deming because you can go watch arguing as well. 181 or arguing. Agile 199. Both were damning podcasts me go. names. names, got Grab lots lots coffee. coffee going to 181 from September 11th 2024. 24. It It was was titled titled Deming's Deming's 14 Fourteen points. Points. The The management Management Revolution We Needed Four Years Ago is good title. And then arguing Agile 199 W. W. Edwards Edwards Demings Deming's profound profound knowledge knowledge for for transforming organizations from January 22nd, 2025 those two podcasts together, they can hold you over until you. Get point where you're either Deming books and then and, then. can, be path yourself. So speaking of To Deming I have a take away here. Two questions. You can stop asking what number we want And start asking. Do we. Understand the. System well enough. To know what optimizing for this number will do? You can still set. numbers. Sure, you Still, mean you're still. Continue doing what. said. Stop doing. But ask the second question first. Okay[UH] yeah. And I'd like to [UM] just. Double click and say ask. Another question. end Second question, that is. What happen we didn't make that number instead. Right What does it mean not to actually miss that? Target. Oh no, the sun's still gonna rise tomorrow[UH] no. I just spoiled for you. Spoiled. answer. It's worth it. We're talking about that because lot people get hung up on the. Sure. Right. So yeah. Well before setting any numerical targets, let's ask, understand system well enough to know what will happen, won't we? Optimize this number number. or Well, mean mean even know what's realistic thing. When miss this. I've been on lot of software projects where we. The number and world just keeps going anyway. Sure. keep extending deadline extend. deadline. Nothing happens [UM] And that's. That's this. hey, listen, all these numbers made up anyway. You're starting to get. Bad taste your mouth for project management as a. Discipline. When all numbers made up. Because stress other things. But and, and. I know some people listen podcast say, oh, Brian, Some numbers are real. Sometimes have real deadlines. miss them. got, kNow, having the heavy penalties or maybe the. money runs out. or other things. Right. And yes, that's real thing. But I'm just pointing this out. say number of times I've had these artificial numbers where when we miss it, nothing happens Versus, We run money we. Start laying people off which has happened to. Sure. But number Times where somebody just made something up You blow past it like. Nothing happened. Light years. mean, I'm talking many fold. 10 acts. Yeah, Yeah. And they could also be know, regulatory requirements. have to hit a deadline, cetera. You just work that. Right? Sure So there's answer. But yeah, what's out there is leadership management mostly putting dates in front you. they know real dates. Out here, same thing with budgets. Right? say miss deadline. And then they've always told There's no more money. Yeah, but they. Let's go back well and find some life continues. Oh my goodness. Almost Always. yeah. other suggestions here are replace. Try. Replace. Hit this number with improve the system. How? certain way. And then, and then course suggestion which never, never. Never goes is just read Deming like other crisis the New Economics both good books. Quick, quick looks read. They're Both available. You can definitely get, Get New Economics on audio book. don't know about. Oh, think other crisis not. Available. It's. But that's OK. The new economics covers everything everything that that other. crisis covers. covers, You. you know, Know, out other Crisis. crises Was was done earlier. you you're read really go. goal. You you? Read read. New Economics you're reading start up like you. Read those things youshould under your basically understanding all of modern business at Those are great suggestions though. three books by themselves will get you long way forward. All right. Let's, let's wrap this podcast here. So what think is damning outdated or relevant because it's just for manufacturing [UM] has nothing us or. Did never actually listen to. let us. Now in comments and tell us, which of his 14 points hurts most. That's I'm asking. And you'd like to do yet another podcast on Deming or for that that matter matter, [UM] on Sears, Sears. the. The I demise save of sears. Sears. We're We're happy happy to, to at at least consider those. That's right. So we started with claim that. system is designed so you can't tell when you. guard. So here's what episode showed. damage is invisible. By design. People notice get removed first by design and the. truth fragments as you split it across the. different dashboards again By design and Deming outlined all this in 1986. If we'd only listened. so let's bring this clo. So after working through this Sears debacle and the. Wells Fargo whistle blower firing and[UH] talking about damning in reading through his actual words this podcast So you, walking away softer? Okay, is harder them? Somewhere-between. Oh, definitely harder on. I'm also not going to bring up whistle anytime soon either, so that's where I sit[UH] You're you're never never gonna going to give [UH] give you you up. up And and they're never. going. That's That's right. right. Exactly. Exactly. right, that's a, tha tha's the end part two. So two. Yeah. And you're thinking. I. How this landed with[UM] So that's part you. If have OK hours that work for you, we'd love to hear from You. Have OkayOkay as it don't work. For we'd like Here, Fromi let know other topics. like, it's dove into. If we. Go. Like and subscribe.