The Psychology of Organizational Intelligence

A few writers have started to make some interesting connections between business intelligence and cognitive psychology, including references to a CIA paper called The Psychology of Intelligence Analysis written in 1999 by Richards J Heuer jr.

• Ted Cuzzillo, CIA’s insights on the psychology of analysis (July 2009)
  
• Wayne Eckerson, The Next Wave in BI: Decision Analysis (Jan 2010)
• Ted Cuzzillo, Call in the shrinks for the next phase of business intelligence (Jan 2010) 

The flaws in military intelligence have been widely discussed in the media. I have already discussed the writings of Malcolm Gladwell in the New Yorker; and Wayne references an article in the Boston Globe by Robert Jervis, Think Different CIA.

Heuer offers some detailed procedures (we might call them "best practices") for avoiding some known cognitive errors of intelligence and decision-making, and there may be some opportunities for building some of these practices into management training and team-building exercises as well as into the tools and platforms supporting organizational intelligence.

In a well-functioning team, healthy debate should reduce the incidence of cognitive error. However, many organizations display various forms of dysfunctional behaviours (such as bullying or groupthink), which tend to amplify cognitive error. This takes us from cognitive psychology into other aspects of organizational psychology.

There is also the question whether the intelligence failures are primarily cognitive or something else. Perhaps Treverton's distinction between puzzles and mysteries (which I picked up via Malcolm Gladwell) is relevant here. (See my post on Puzzles and Mysteries.)

Heuer's paper predates a couple of embarrassing failures for the US intelligence community - the failure to anticipate the September 11th attacks, and the false assessment of WMD in Iraq. So either Heuer's recommendations were not implemented or they were not sufficient. A more recent CIA paper suggests the latter: "The dysfunctional practices and processes that have evolved within the culture of intelligence analysis go well beyond the classic impediments highlighted by Richards Heuer in The Psychology of Intelligence Analysis" [Curing Analytic Pathologies: Pathways to Improved Intelligence Analysis].

I like the concept of "analytic pathologies" because that provides a good starting point for assessing and addressing the various blocks to organizational intelligence we can observe in most commercial and government organizations. Clearly the cognitive errors identified by Heuer are important, but they are often going to be symptoms of some deeper pathology. Even if "best practice" fully addresses the cognitive errors, we are going to need "next practice" to address the deeper stuff.

When does Communication count as Knowledge Sharing?

Following my post Intelligent Knowledge Management, taking issue with @snowded's "knowledge sharing" agenda, I have read a few more pieces about knowledge sharing, including Patrick Lambe's piece If We Can’t Even Describe Knowledge Sharing, How Can We Support It?. See also Mark Gould, Knowledge sharing: it may not be what you think it is.

Patrick describes a person with a life-critical illness, being told stuff by various healthcare professionals and others in what he describes as "a series of encounters with intersecting knowledge worlds", and has drawn a good diagram of this process. Patrick seems to regard it as a complex example of knowledge sharing. But in what sense does this count as sharing? To me it just looks like communication - translating specialist knowledge into accessible information.

In many contexts, the word "sharing" has become an annoying and patronizing synonym for "disclosure". In nursery school we are encouraged to share the biscuits and the paints; in therapy groups we are encouraged to "share our pain", and in the touchy-feely enterprise we are supposed to "share" our expertise by registering our knowledge on some stupid knowledge management system.


But it's not sharing (defined by Wikipedia as "the joint use of a resource or space"). It's just communication.

Making Intelligence Relevant

@richwatson is one of many pointing to a think tank paper called Fixing Intel. The report's primary author, Major General Michael T. Flynn, is the top US intelligence officer in Afghanistan [FT article (html), full report (pdf)].

The report explains how US military intelligence has been rather one-sided, and General Flynn tells us what he has started doing about it. There are some useful pointers here for organizational intelligence in the civilian world, and software industry analyst Richard Watson sees it as a wakeup call for analysts everywhere.

As I see it, the old system was unbalanced in three ways.

1. One-sided activity driving one-sided information gathering

Given that the US troops are targets for a number of specific insurgency tactics, such as roadside bombs, it is perfectly understandable that a lot of interest and attention is paid to protecting troops against these tactics by detecting and defusing the bombs, and identifying and dealing with the insurgents placing the bombs. Thus anti-insurgent activity on the part of US forces calls for information gathering focused on the enemy. As General Flynn explains, "understandably galled by IED strikes that are killing soldiers ... intelligence shops react by devoting most of their resources to finding the people who emplace such devices".

But although this is important, it is not enough. General Flynn makes the important distinction between anti-insurgency (dealing with the enemy) and counter-insurgency (dealing with the conditions in which insurgency exists), and argues that a strategic approach to counter-insurgency calls for a shift of focus - from enemy-centric to population-centric. "Lethal targeting alone will not help U.S. and allied forces win in Afghanistan."

Seen from this perspective, a one-sided emphasis on enemy-centric information gathering appears to be based on the wrong conception of the primary task facing US forces. In his paper on the Primary Risk, Larry Hirschhorn talks about the risk of choosing the wrong primary task.

2. One-sided interpretation

Furthermore, the information is analysed from a particular perspective - limited by location and chain of command, and using traditional "lenses". If the intelligence focus is on identifying and killing the insurgents, then patterns that are not directly relevant to this objective may be missed. There's obviously something wrong with military intelligence if officers "acquire more information that is helpful by reading U.S. newspapers than through reviewing regional command intelligence summaries".

And while "detecting roadside bombs" is what Treverton would call a "puzzle", understanding the population is more of what he calls a "mystery". [See my post Puzzles and Mysteries.] For such intelligence challenges, it's not about uncovering small but important facts, but analysing more deeply the "vast and unappreciated body of information" that is already available. "Tactical information is laden with strategic significance."

And “the best information, the most important intelligence, and the context that provides the best understanding come from the bottom up, not from the top down,” as General Martin E. Dempsey, commander of the U.S. Army Training and Doctrine Command, recently stated [Landpower Essay(pdf)].

General Flynn therefore wants intelligence analysts to be more social beings, more extroverted. Hm, not sure about that one.

3. Action is reactive and repetitive - lack of learning

General Flynn again, enemy-centric information gathering and activity is "reacting to enemy tactics at the expense of finding ways to strike at the very heart of the insurgency". He also complains about an intelligence community culture "that is emphatic about secrecy but regrettably less concerned about mission effectiveness". He concludes that "the urgent task before us is to make our intelligence community not only stronger
but, in a word, 'relevant' ".

Thus there is a lack of learning at two levels. For the intelligence community, the feedback loop is one-sided. If secrecy is the primary objective, you can always be criticized for saying too much (errors of commission), but never for saying too little (errors of omission).

As it happens, I was listening to the late Russell Ackoff talking about this distinction in a posthumous radio interview last night [Doing it Wrong]. He was arguing (among other things) that true learning requires paying attention to the "road not taken"

And even in terms of effectiveness, the feedback loop is much clearer when it's a puzzle, because we can measure performance. How many bombs did we detect and defuse, how many did we miss. It's a little more difficult (but by no means impossible) to measure analyst performance in unravelling mysteries.

Meanwhile, the US forces as a whole may be learning a lot of important tactical lessons, but could be failing to learn strategic lessons. "History is replete with examples of powerful military forces that lost wars to much weaker opponents because they were inattentive to nuances in their environment."

From a historical perspective, it is tempting to see the situation in Afghanistan as a repetition of the Soviet experience in the 1980s, and of the British experience in the nineteenth century. But there are some important differences, and potential sources of surprise. Joshua Cooper Ramo, in his book "The Age of the Unthinkable", bigs up Hizb'allah as the equal of Google in the innovation stakes. Afghanistan may not be as stable and isolated as we imagine, nor as tightly connected to other regional issues as the American neo-cons once argued, but it is surely a space where better intelligence could lead to strategic learning.

Summary

from	to
puzzle	mystery
looking for clues	building a map
reactive	proactive
tactical	strategic
analysts are introverted	analysts are extroverted

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We may also note the channel by which General Flynn has chosen to make his views public. According to Pentagon Press Secretary Geoff Morrell, Defense Secretary Robert Gates saw the report only after it was made public. Although he had real reservations" about the decision to have it published by a private group, Gates "found the analysis 'brilliant' and the findings 'spot on'. ... The report itself is exactly the type of candid, critical self-assessment that the secretary believes is a sign of a strong and healthy organization," he said.  [Voice of America, 7 Jan 2010]

Thus Flynn's paper itself and the manner of its publication seems to exemplify the kind of bold extroverted analysis Flynn wants to encourage. Thus it can be regarded as a metacommunication (a communication whose style reflects its content), which when done consistently and authentically is an important element of leadership.

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In future posts, I want to look at how intelligence failures like these affect civilian organizations, as well as discussing Richard Watson's parallel with software industry analysis. Comments and contributions and ideas welcome.


Related posts

Puzzles and Mysteries (January 2010)
Linear Thought (April 2017)

Explaining Enron

In his latest collection of New Yorker articles, What the Dog Saw, Malcolm Gladwell includes two separate pieces on Enron.

In Open Secrets (originally published in the New Yorker, Jan 2007) he discusses a collective failure to appreciate the flaws in Enron's business model - a failure suffered by many investors and journalists, as well as (apparently) Enron management and other employees. As Gladwell tells the story, this was not due to a lack of available information, or because critical nuggets were concealed from public scrutiny (as in a classic conspiracy), but because of a failure to connect the dots. For a longer commentary on this article, see my post Puzzles and Mysteries.

In The Talent Myth (originally published in the New Yorker, July 2002) he discusses the Enron Superstar culture, in which individual talent was valued much higher than actual outcomes. He documents examples of high-flying managers who, having burned large quantities of capital on glamorous but incompetent ventures, were simply given fresh opportunities to burn more capital. Gladwell points the finger of blame at consultants McKinsey for encouraging this narcissistic culture, and expresses his surprise that McKinsey has so far avoided the kind of public mauling that Enron's other advisors (auditors and investment bankers) have suffered.

What joins up these two pieces is the subject of my next book: organizational intelligence. As it happens, Gladwell talks about organizational intelligence in a further piece on Connecting the Dots (originally published in the New Yorker, March 2003). And in the piece on talent, Gladwell points out some of the characteristics of the Superstar culture that may impair both organizational intelligence and organizational success.

• Overvaluing abstract knowledge and undervaluing grounded (tacit) knowledge
• Moving people around frequently, so their true performance cannot easily assessed. Hence performance evaluations that aren’t based on performance.
• The needs of Enron customers and shareholders were secondary to the needs of its stars. 

From a psychological point of view, narcissism is more about identity (who we are) than about viability (what we do). Narcissists (both individually and collectively) may not be very good at assessing what is really going on, are likely to be one-sided when sharing knowledge and ideas, and will generally try to interpret events as confirmation of how wonderful they are rather than as opportunities for learning. So that's several problems with organizational intelligence right there.

Here's how Gladwell sums it up.

The broader failing of McKinsey and its acolytes at Enron is their assumption that an organization’s intelligence is simply a function of the intelligence of its employees. They believe in stars, because they don’t believe in systems. In a way, that’s understandable, because our lives are so obviously enriched by individual brilliance. Groups don’t write great novels, and a committee didn’t come up with the theory of relativity. But companies work by different rules. They don’t just create; they execute and compete and coördinate the efforts of many different people, and the organizations that are most successful at that task are the ones where the system is the star. ... The talent myth assumes that people make organizations smart. More often than not, it’s the other way around.

That's pretty much what I've been saying for years - that the intelligence of a system is not a simple arithmetic function of the intelligence of the subsystems. So to make an intelligent organization, it isn't enough to recruit the brightest people, locate them in state-of-the-art office buildings, and provide them with the smartest computer tools and networks. Super-intelligent individuals are often poor at talking to one another and sharing knowledge, let alone coordinating their work effectively.

And if we come back to the question of connecting the dots, this is always going to be difficult in any large organization, but it's perhaps going to be particularly difficult in a culture where everyone is thinking outside the box. (As Gladwell wryly ends his piece, maybe it was the box that needed fixing.) Sometimes there is no substitute for careful and detailed analysis.

Gladwell interleaves the Enron story with a story of British and American intelligence trying to interpret German propaganda during the Second World War. One journalist at the time described the propaganda analysts as the greatest collection of individualists, international rolling stones, and slightly batty geniuses ever gathered together in one organization. Despite this fact, they achieved an extraordinarily high rate of accuracy, especially when they worked jointly and systematically and not as isolated mavericks.

In contrast with this state of heightened realism, a narcissistic organization is relentlessly positive. Barbara Ehrenreich is currently in the UK promoting her new book called (in this country) "Smile or die"; I heard her on Radio 3 Nightwaves last night saying that Condoleezza Rice occasionally wanted to raise some questions or doubts . . . but she was afraid to because the president hated "pessimists". This is what Ehrenreich calls "a bubble of forced optimism". (See also RSA lecture and Barbara Ehrenreich on the Negative Power of Positive Thinking.) I guess Enron was just an extreme example.

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Barbara Ehrenreich, Smile or Die: How the Relentless Promotion of Positive Thinking Has Undermined America (2009)

Malcolm Gladwell, What the dog saw (2009)

Richard Veryard, Building Organizational Intelligence (LeanPub 2012)

Related posts: Connecting the Dots, Puzzles and Mysteries.

Five Disconnects of Organizational Intelligence

There are several capabilities that add up to intelligence. Full intelligence cannot be achieved if any of these capabilities are lacking, or if they are out of balance, or if they are not connected and coordinated.

In this blogpost, I am going to identify five key disconnects of organizational intelligence - these are common patterns of impaired intelligence, which produce various forms of organizational stupidity.

1. From practice to fact

Practice and policy is based on belief rather than evidence. The organization faithfully follows standard textbook routines, optimistically believing these to be "best practices", but without collecting data to objectively verify and improve the effectiveness of these practices. Triumph of hope over experience.

2. From fact to interpretation

Relevant information is gathered and available, but is not properly analyzed and understood. Failure to "connect the dots" (as in President Obama's recent criticism of US security).

3. From interpretation to action

Detailed analysis is carried out, but the organization lacks the ability to convert understanding into action. This may be a sign of "analysis paralysis" or procrastination.

4. From action to learning

The organization repeats actions without improvement. There is a lack of self-awareness. No feedback loop, so improvements in performance are haphazard and unremarkable.

5. From learning to practice

Lessons are learned on paper, at an abstract intellectual level, but these are not translated into an authentic transformation of working practices. People are able to say what they have learned, and can articulate a plausible theory of what they should be doing or might be doing, but they seem unable to deploy their learning in real situations.

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As you may have noticed, these five form a neat circle. But these are not the only disconnects we can identify, and there are many other symptoms of lacking organizational intelligence.

If and only if there is a collective willingness to address any or all of these disconnects, then and only then does it make sense to look at technologies (such as Business Intelligence tools multiplied by Enterprise 2.0) that might help people and organizations to improve their individual and collective intelligence.

The value of time management ...

After I blogged about the value of getting things done, @johanlindberg asked me to look at a couple of other time management practices - Burn-Down Charts and the Pomodoro technique.

There must be hundreds of time management practices, and thousands of self-help books and websites encouraging people to organize themselves better. Some of them even tell you to stop reading and get on with stuff.

Why are there so many? Is it because they all work, or because none of them do? Is it because there isn't a single approach to time management that suits everyone, so we all need to read dozens of these before we find one that provides just the right combination of common sense and quirkiness that chimes with our own lives? Or is it because people who have difficulties with time management are always looking for further displacement activity - as if reading just one more book, or buying just one more iPhone app, will suddenly change us from muddled procrastinators into smooth and effective operators?

I cannot see a simple way to evaluate and compare these time management approaches as practical methodologies. Clearly there is enormous subjective value in organizing oneself, just as there is in coordinating a team, and we can certainly see the costs and risks associated with the lack of organization or coordination in particular situations, but organization and coordination are generally valued because they help us achieve our goals, rather than being primary goals in their own right.

What about judging a person or team in terms of achievement? There are levels of achievement that may be relevant here. Firstly, efficiency or productivity in handling a fairly uniform stream of events and tasks. Secondly, effectiveness in handling small variations in the event-stream - small adjustments that represent a continuous improvement loop - (in other words, single-loop learning to maintain a stable set of outcomes with variable inputs). Thirdly agility in anticipating and managing change (in other words, double-loop learning, where the desired outcomes may change as well as the strategies).

"Best practice" time management may help people become more efficient and effective in narrowly defined areas or known tasks. But sometimes the reason for procrastination is that people aren't sure whether that's the right thing to do. Sometimes it really is better to stop and think; and a time management practice that inhibits reflection may ultimately turn out to be a handicap.

Perhaps we should think of time management not as a best practice (which everyone needs all of the time) but as a kind of therapy (which many people need sometimes). In which case, it's not about getting everyone to adopt some standard technique, but having resources available to help people and teams when they experience a certain kind of stuckness. Sometimes true intelligence is knowing when you need help.

The value of getting things done ...

@jackvinson and @steveellwood ask whether anyone has documented the "value" of GTD w/i an organization? (Inspired by my post Meeting of Minds on meeting culture).

GTD stands for Getting Things Done - a popular time management methodology presented in a book by David Allen (subtitle: "The Art of Stress-Free Productivity"), which Wired Magazine (September 2007) described as a Cult of Hyperefficiency. A closely related approach is offered by the 43 folders website.

We might imagine that the value of Getting Things Done could easily be calculated by considering the cost (or opportunity cost) of Not Getting Things Done. But according to the old rhyme, the cost of Not Getting Things Done can escalate indefinitely.

For want of a nail the shoe was lost.
For want of a shoe the horse was lost.
For want of a horse the rider was lost.
For want of a rider the battle was lost.
For want of a battle the kingdom was lost.
And all for the want of a horseshoe nail.

So how would we estimate the true value of a nail? No doubt the blacksmith would argue the nail's case for being the critical success factor for the kingdom. But someone else might produce an equally plausible argument for something entirely different being the critical success factor.

So we might think that the value of Getting Things Done depends which things get done. But as Gary Wolf explains in his Wired review, Allen differs from a lot of earlier self-help gurus by skipping the philosophical reflection stage. "Instead, he likes to describe his system as a 'bottom up' approach, by which he means that life's values emerge from its tiniest component actions, rather than a top-down approach that starts with deep thought."

So the purpose of your actions is whatever you find yourself doing, emerging from a series of micro-decisions that are triggered by a large number of events (such as incoming email). In other words, POSIWID. The aggregate value of this activity is determined by its overall coherence, rather than its correspondence (alignment) with any externally given goals and values.

In their paper Getting Things Done: The Science behind Stress-Free Productivity (pdf), Francis Heylighen and Clément Vidal describe Getting Things Done as a praxeology - in other words, a theory of practical action. They point out that it is intrinsically difficult to compare the productivity of people using GTD with that of people using different methods.

"The reason is that because GTD does not embrace explicit priorities or optimization criteria, there is no obvious standard by which to measure expected productivity enhancements. A simpler approach may be subjective evaluation: how satisfied with their work are GTD users compared to users of other methods? However, this will still teach us little about precisely how and why GTD is supposed to work."

Furthermore, because there are no obvious standards, it is not clear what other methods it would be appropriate to compare with GTD. How about the Rule of Saint Benedict, for example? (The Rule of Saint Benedict was of course originally intended to govern a community of monks, although some people think it can have secular applications. Whereas GTD appears to be aimed at individuals rather than organizations.)

Given that GTD is billed as a way of reducing stress, perhaps it would make more sense to assess its value in those terms - in other words, evaluate it not as a praxeology but as a New Age therapy. So we should be comparing it not with the Rule of Saint Benedict but with Scientology.

Ice Nine

by Richard and Aidan

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Earlier this week, Rachel was on her way to New Zealand via Heathrow. Here's how the interaction of several systems failed her.

1. Thanks to the latest security scare, it now takes two and a half hours to search all the handbaggage and get all the passengers onto the plane.

2. By which time the plane has frozen, and needs de-icing again. That takes another hour.

3. By which time the pilot and co-pilot have already spent so much time sitting on the plane that they no longer have enough flying hours remaining in this shift to take the plane to its destination. So the flight is cancelled.

4. The passengers are asked to return to the baggage hall, collect their checked-in baggage and start the process all over again. But there are many other flights that have been cancelled for similar reasons, and the baggage hall is already full-to-bursting with unloaded bags and frustrated passengers, so Rachel has to wait several hours before her unloaded bags appear on the carousel.

5. Then she has to queue to get onto the next available flight, and the process starts all over again.

By a happy fluke, the next plane Rachel boarded actually managed to take off, and she was on her way to New Zealand, but not before a last-minute search to find enough qualifying aircrew ...

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Why does this kind of mess occur? Anyone can look at the whole system and see what could have been done differently. But each system is operated by a different organization, and there is a lack of trust and overall systems leadership.

As readers of Kurt Vonnegut's novel Cat's Cradle will recognize, Ice Nine was the name of a fictional crystal that was capable of bringing the whole world to a complete stand-still. Quite an apt metaphor for failed systems then.

Flawed Measures

Why do something you know is flawed?

Here are a couple of examples that crossed my desktop today.

• Anti-paedophile checks 'flawed', admits boss Labour’s controversial anti-paedophile database will not guarantee to keep children safe, the head of the programme has admitted. [Daily Telegraph, 6 January 2010] via @glynmoody and @privacyint
  

• Following my latest complaint that the ongoing OWASP project to identify the Top Ten Security Risks is fundamentally flawed (see previous discussion on my Computing blog) @mcgoverntheory replies "Many contributors to the top ten agreed that top ten lists as a concept are flawed. Its all about helping others move needle."

In both of these examples - I'm sure we could find many more examples of this kind of thing - there is an implicit belief that it is better to do something than to do nothing at all.

At the opposite extreme, we can find the perfectionist strategy that it is better to do nothing than engage in flawed activity. For example, Deming and his followers criticize certain forms of management intervention as "meddling" or "tampering", based on insufficient appreciation of the structure of the system in question, although as I've pointed out (in Reasoning about systems and their properties) such labels are themselves subjective interpretations rather than neutral observations.

The only possible resolution of this dilemma is a willingness to take bold action in the face of uncertainty - accepting the risk that something won't work, taking good precautions to mitigate the risk but going ahead anyway. This is why we need leadership rather than mere management.

Notes on the Value of Culture

Following my previous post Meeting of Minds, about the cost of meetings and of the "meeting culture", @j4ngis asked "Would you also consider value of meeting culture?"

There is a more general discussion of culture to be had here. Culture is often blamed when things don't go according to a rational managerial ethos. As Oscar Berg blogged yesterday, Did you ever hear anyone shout "culture failure!"?

But an organization without culture - well, it just wouldn't be an organization at all. Culture is what gives an organization its identity - it is a kind of deeper structure that protects the organization from incoherence, instability and inconsequentiality. Culture tells us how an abstract business model is embodied in a particular organization.

Arjo Klamer identifies several ways of talking about the value of culture. In an anthropological sense,

"‘culture’ ... refers to the shared values, stories and aspirations that distinguish one group of people from another (think of a community, an organization, an ethnic group, a nation or a continent). The economic value of culture would be the economic contribution that those shared values make. As the sociologist Max Weber famously argued, the culture of Calvinism may have contributed to the rise of capitalism and the economic growth that came with it. A particular culture may improve economic performance or hinder it. A culture of distrust can seriously hamper the market process. A culture of consensus, such as exists in Japan and the Netherlands, can stifle entrepreneurship but may also be responsible for stability in the event of crisis." [Value of Culture (pdf)]

Edgar Schein identifies three levels of organizational culture - behaviour and artefacts, values, and assumptions and beliefs. [See Wikipedia. See also notes by Ted Nellen.] We can use the VPEC-T lens to unpack and identify these different elements.


An organization has various mechanisms to prevent random changes to the way-we-do-things. Much of the time, these mechanisms are accepted uncritically as part of normal management control - like an immune system that prevents the organization being taken over by destructive memes. @AndreaMeyer calls these mechanisms corporate antibodies. However, when managers themselves want to change things, these mechanisms turn out to be inconvenient obstaces, whose aggregate effect is to suppress innovation.

Vincent Kenny and Philip Boxer describe culture as follows.

"Anyone who works in businesses will have encountered the notion of culture, and the incredible extent to which a culture lives on in a way which defies anyone's attempts to bring about change. It is not only a question of dealing with the issue of anxiety as an individual issue - the whole fabric of the organisation seems to be caught up in the conservation of identity however much change individuals may make." [Economy of Discourses, 1990]

Kenny and Boxer go on to talk about "the levels of extreme inflexibility and 'stuckness' which we witness in large companies" and ask "how can we explain the increasing degrees of rigidity and loss of power for self-transformation evident in the invariant identities and cultures of organisations?"

The reason why leaders struggle with culture is because there is a creative tension or asymmetry between culture and identity on the one hand, and viability (or effectiveness or survival) on the other hand. This is a critical element of the Asymmetric Design lens, which Philip Boxer describes in When is a stratification not a universal hierarchy? (See also the sociological distinction between structure and agency.) This provides a rigorous framework for reasoning about complex structural change.

Coming back to @j4ngis's question - what is the value of the meeting culture - I guess the key question here is what other cultures (more flexible, less bureaucratic, or whatever) we'd be comparing it with, in what context. What function does this culture serve in the context of this particular organization, and how does it affect the strategic outcomes and energy profile of the organization?



Related posts: Vaccination (September 2004), Meeting of Minds (January 2010), Easier Seddon Done (June 2008) 

Connecting the Dots

@dahowlett has a good post on Enterprise 2.0 and its supposed contribution to improving the American security services’ ability to counter terrorism. @skemsley picks out the key quote "content without context in process is meaningless".

Dennis points out the apparent gap between the claims of Enterprise 2.0 champions (notably Andrew McAfee, author of "New Collaborative Tools for Your Organization's Toughest Challenges") and the continued failure of the U.S. intelligence community to "put the pieces together" (as reported by the New York Times). Dennis goes on to quote a critique from Sig Rinde, who talks about "stitching collaboration tools together hoping for some process structure to ensue".

Dennis calls for a "sharper focus on organizational issues" and "a more rigorous examination of the limiting factors which bedevil technology introduction". I wholeheartedly agree with that. Dennis talks about process, but I believe my capability model of organizational intelligence is equally powerful.

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As fans of Malcolm Gladwell may have already recognized, the title of this post coincides with an article published in the New Yorker, March 2003 (now reprinted as a chapter in his latest book "What the Dog Saw and other adventures"), which analyses US intelligence failures before and after the Al Qaeda attacks on September 11th 2001. Gladwell points out that anyone can connect the dots after the event, and that things that were confusing at the time often seem a lot clearer with hindsight. It is easy to criticize intelligence agencies for failing to spot connections in a mess of data, once we know where the connections are.

Even President Obama complains that the intelligence community had failed to "connect the dots" [BBC News 5th January 2009].See also Peter Ubel on the Politics of Invisibility and Farnam Street on Inevitable Intelligence Failures.

In the course of his analysis, Gladwell quotes a paragraph from Harold Wilansky's 1967 book on Organizational Intelligence, which praised President Roosevelt for maintaining a state of "constructive rivalry ... structuring work so that clashes would be certain". This is certainly a long way away from the naive and fluffy fantasy of organizational collaboration as sometimes depicted by the champions of Enterprise 2.0.


Related posts: Five Disconnects of Organizational Intelligence (January 2010), Explaining Enron (January 2010), Steve Jobs wasn't a visionary (October 2011)

Meeting of Minds

@mcgoverntheory asks whether I know of any research quantifying the cost of the meeting culture in enterprises.

There is a lot of research on meetings, but the cost factors are very complicated to calculate and compare.

There are three elements to the cost of a meeting.

Firstly, the direct cost of the meeting - the travel and subsistence costs of the employees, the daily rates of consultants and contractors, facilities and refreshments. Electronic meetings are often cheaper (at least once the infrastructure is in place), but can be less effective, especially for longer meetings.

Secondly, the opportunity cost of the meeting - what the employees could have been doing if they hadn't been in the meeting. For some jobs, this is calculated on the assumption of constant productivity, so for example if your normal job is writing code or selling products, then every hour in meetings represents a given quantity of code not written, or a given quantity of lost revenue. However, for any job requiring any degree of intelligence, creativity or coordination, the assumption of constant productivity simply doesn't stand up to scrutiny.

The third element to consider is the cost of not having the meeting. Good meetings can make people more productive and creative, and help avoid wasted effort. Good meetings make the organization more intelligent - processes become more efficient, decisions get better, the organization learns more quickly - and this increases the overall added-value of the work done. (As part of my ongoing research on organizational intelligence, I am looking for ways to benchmark this kind of improvement.)

However, James asked not about the cost of meetings, but about the cost of "the meeting culture". In many large organizations, there are meetings for the sake of meetings, meetings out of habit, whose purpose and value is not obvious to the participants. Surely this kind of thing is the very opposite of organizational intelligence?

Perhaps so, but we should not be too hasty to jump to conclusions. Many people, while complaining bitterly about too many meetings, know perfectly well that they couldn't sustain a high level of productivity at the primary task throughout the day without some variation in routine. It's just not healthy to sit at your desk all day. The meeting therefore serves a useful purpose, to provide relief in an otherwise unremitting working routine. There is a complicit connivance at arranging meetings, at which issues are discussed but not resolved, decisions are deferred, absent stakeholders are talked about behind their backs, and managers can gently doze with their eyes open. The purpose of the meeting is what it does (POSIWID).

This kind of meeting culture especially thrives in the kind of Theory X or Fordist organization where people are expected to be busy all the time, and to fill in timesheets, because time is money. In a Theory Y or post-Fordist organization, people are trusted to get the job done. When you have been staring at the screen for too long, you can just go to the vacant lot behind the office and play football for twenty minutes instead of having to invent a pointless meeting.

So the cost of the meeting culture is basically the human and financial and strategic cost of Fordism. Just give me a call, and I'll come and quantify this cost for your organization. Or we could have a meeting about it.

See also Notes on the Value of Culture (January 2010)

Puzzles and Mysteries

For my second post inspired by Malcolm Gladwell's latest book "What the Dog Saw, and Other Adventures", I want to turn to the chapter "Open Secrets" (originally published in the New Yorker, Jan 2007).

In his analysis of different kinds of intelligence, Gladwell picks up the distinction between puzzles and mysteries originally proposed by Gregory Treverton. (See Curtis Frye's review of his 2003 book Reshaping National Intelligence for an Age of Information. See also Risks and Riddles, published in the Smithsonian Magazine, June 2007. And see my post on Making Intelligence Relevant.)

A puzzle is characterized by having a definite answer, if we can only find it. A puzzle is difficult only because we don't have enough information. For example, Gladwell and Treverton classify the question "Where is Osama Bin Laden?" as a puzzle. If we knew exactly where Bin Laden was, then this would cease to be a puzzle at all. So the purpose of intelligence here is to get relevant pieces of information that help narrow down the field of search.

A mystery is characterized by ambiguity and uncertainty. For example, the question "What is Osama Bin Laden up to?". There is perhaps no shortage of information here, there may even be too much information, the difficulty is in interpreting the information correctly.

Gladwell uses the distinction to discuss the Enron case. He argues against the popular view that Enron management concealed their dealings, and points out that the information was freely available to those that took the trouble to wade through the documents. In contrast to the Watergate case, which was only revealed because an insider (the famous "Deep Throat") leaked information to Woodward and Bernstein, journalists investigating the Enron case simply downloaded the information they needed from the Enron website. Indeed, several years before Enron fell, a bunch of MBA students had carried out a pretty accurate analysis, based merely on the published accounts. In Gladwell's opinion, Enron therefore counts as a mystery rather than a puzzle.

This is consistent with an assertion made by Harold Wilensky in his 1967 book Organizational Intelligence (which Gladwell has cited elsewhere), that a sophisticated reporter working with open sources may achieve more than an agent working with top-secret information. Wilensky highlights the distorting effects a doctrine of secrecy can have on intelligence: one example in Wilensky's book concerns the possible consequences of an American invasion of Cuba, where reporters read the situation more accurately than the CIA experts.

Dishonest people can create puzzles simply by withholding important information. Enron executives went to prison because their conduct was judged dishonest. Gladwell agrees that Enron was reckless and incompetent, but defends the company and its executives against the charge of concealment. The state of Enron's finances was too complicated even for its own executives to understand; we might imagine that some of the executives consciously took advantage of this complexity, but we could equally imagine that this was a situation that Enron blundered into without any deliberate strategy. Hence the mystery,

Characterizing Enron as a mystery also goes some way to explaining why the auditors were useless in detecting the fraud - if it was indeed a fraud. The audit process is designed to spot errors and omissions in the financial accounts, which might indicate dodgy dealings somewhere in the organization. The audit process is not designed to spot excessive complexity or risk, and auditors do not generally practice the kind of ratio analysis that the MBA students used. (Auditing is therefore one of those "best practices" whose flaws are exposed by complexity.)

Another lens through which the Enron accounts could reasonably have been viewed was the taxation lens. The fact that Enron wasn't paying much corporation tax (in several years it paid no income tax at all) might have been seen as an important clue to its lack of real profitability. However, those who wanted to believe in Enron's profitability could easily convince themselves that the low level of tax payments represented clever tax avoidance - in other words, interpreting it as evidence of the smartness of the accountants and/or the stupidity of the tax authorities. (Thus the accountancy lens was used to discredit alternative lenses that might have revealed alternative truths.)

Another way of thinking about the difference between puzzles and mysteries is that puzzles are about people (deliberate conspiracies) while mysteries are about systems. As Gladwell tells the story, Enron wasn't about a handful of bad people misleading everyone else, it was about a system that led everyone astray. Working out a mystery is not a question of collecting more information, but about finding a frame or lens for systematic analysis, to make sense of the information we already have.

Does it make sense to divide intelligence problems into puzzles and mysteries, as Treverton and Gladwell do? I'm not convinced there is a simple either/or, but I'm not sure that's what Treverton and Gladwell are claiming anyway. I  think what is important here is not to identify which problems count as puzzles and which ones count as mysteries, but to acknowledge that at least some problems do count as mysteries in Treverton's terminology, and therefore we need an intelligence capability that helps us to make sense of too much information, and not rely solely on an intelligence capability that merely gathers more information in the hope of resolving something. Examples of this need can be found both in national security and in business.

In terms of organizational intelligence, this means achieving a good balance between two capabilities - the information gathering capability (Perception) and the analysis capability (Sense-Making) - and linking effectively into the remaining capabilities (Decision, Action, Learning). Sometimes merely collecting more information doesn't help solve the problem, especially if we don't have the capacity to interpret the information we already have, or if the new information merely provides an excuse for further procrastination.

(This is similar to the point some of us were discussing recently on Twitter: whether it is always good to produce more ideas, or whether it is sometimes possible to have too many ideas, especially if you don't have the capacity to use them effectively.)

Was Enron intelligent? Enron certainly did some clever and innovative things, but the spectacular failure of Enron suggests that there were some flaws in the thinking. Here are two suggestions. Firstly, a collective failure within Enron to appreciate the scale of its exposure to risk indicates a weakness in sense-making - an insufficiently robust way of seeing beyond the complexity of the accounts and understanding the true financial state of the company. And secondly, a collective refusal to learn from the voices of doubt coming from external critics. When a company is convinced by its own cleverness, this conviction can become a barrier to learning, and therefore a limitation of true intelligence.

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Other examples of the puzzle/mystery dichotomy

• Bob Rosner (ABC News Feb 2007) suggests that puzzles are left-brain and mysteries are right-brain
• Larry Ferlazzo suggests that puzzles are data-driven and mysteries are data-informed
• Security blogger Gunnar Peterson suggests that Authorization is a Puzzle, Authentication is a Mystery
• The Moonrider blog looks at accidents versus collisions in Motorcycle Safety
  
• Brett Miller quotes Gary Kasparov on Life versus Chess: Uncertainty is far more challenging
• In the 1950s, Frederik Buytendijk described men as puzzles and women as mysteries (via Annemarie Mol).
  

Related posts: Connecting the Dots, Explaining Enron, Making Intelligence Relevant