People learn, organisations don’t?

I was at an excellent presentation by Tim Chittenden (ex RN, ex BAe Systems, now with Sellafield Ltd) about developing the Astute class of nuclear submarines and the lessons learned. Tim compared and contrasted various different nuclear submarine programmes and how different approaches had been taken and the effects they’d had on “success”.

The Astute programme started off aiming for cheapness, as the Batch 2 Trafalgar programme i.e. a simple repeat of the highly-successful Trafalgar class of nuclear hunter-killer submarines, with cost reductions through the reuse of technology from later programmes. Years late, and hugely over budget, the Astutes are a completely new design.  Failure? Yes and no – late and over budget – classic programme management criteria say “Failure”. Delighted customer, more effective and 2/3rds the cost of equivalent US submarines (the US Treasury green with envy) – Success!

Tim contrasted the Astute programme with the Vanguard programme, where cost wasn’t the driver but a quick, high-performance solution – Vanguard was a success on all counts – largely on cost and time, and once more the customer delighted.

All the lessons Tim drew out were well-known to me, especially that early focus on cost cutting leads to delays and cost overruns  – “cheap man, he pay twice”. yet the same problems seem to happen again and again, even in the same organisation.

So why don’t organisations learn from these experiences? Why are “Lessons learned” not?

What is organisational memory that it CAN learn? The key elements that I’m aware of include:

  1. The wisdom and experience (from personal learning) of individual leaders (at all levels) within the organisation
  2. The culture of the organisation – we’ve learned that this way is best
  3. External and internal Standards, standard operating procedures

How well do these instruments of corporate memory fare under the pressure for ever-higher business performance and constant change?

  1. Individual leaders with extensive experience can easily be seen as negative, and given early retirement, made redundant or forced out to make way for dynamic leaders (without the same experience)
  2. Established cultures MUST change to create a more responsive organisation – “We know this way works so we stick to it” cannot survive in the rapidly-changing world businesses operate in. Unfortunately this can lead to throwing out the baby with the bathwater
  3. Processes and standards are a nightmare to update and keep current in a rapidly changing world, and can soon be left behind when everyone is struggling just to get the work done and keep the business afloat.

Let me illustrate this from personal experiences:

  1.  An insurance company was seeking to cut costs, and made a very attractive early retirement offer to all staff over 50. Every eligible staff member outside the Executive took the offer, leaving the company run by much less experienced staff. This led to a more dynamic, but much less knowledgeable set of senior managers. It then had to bring in a team of management consultants to run the rest of their cost-cutting programme!
  2. A life assurer had already lost all senior staff from its pensions division. When their DOS-based tools were to be replaced by a new bespoke system, they resisted strongly ANY change to their practices, eventually admitting they didn’t know what they could safely change. They knew what they did was compliant, but not how they could change it while remaining compliant – knowledge had become rote. It took the recruitment of a new Head of Pensions (ex-Army) to unshackle the Pensions teams.
  3. A major engineering company, with a global reputation for quality, had become totally dependent on standards and procedures to deliver quality products. When a new CEO joined, to save the company from its slow decline, he demanded large-scale  and ongoing changes i.e. the company had to become agile, rather than steady-state. The burden of constantly updating procedures and standards was unsupportable, and the reputation for quality has since been badly tarnished

All three key elements that have supported organisational learning in the past are now heavily compromised in larger organisations, especially PLCs.  It is inevitable that corporate amnesia will grow unless an alternative solution is used.

Staff-turnover and rapidly-changing processes are with us for the foreseeable future, though technology can help – intranets, knowledge management etc.

The main hope for learning organisations lies in corporate culture – people are still the greatest resource (and liability) organisations have. One programme I managed was so successful in its approach that years later the client is still using the tools and techniques he learned from me then. Empowering individuals to do the job better, with cross-checks to ensure they are not doing it worse, are essential for learning.

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