Management and Quality Lessons in the Airbag Recall

qualityWith clear acknowledgement that I am just one of millions of consumers impacted by the Takata Airbag disaster (recall), I feel compelled to vent. I of course vent not by screaming, but by looking for the management lessons in the mess. There are more than a few marketing and management lessons embedded in the industry’s handling of this potentially life-threatening problem.

When Your Safety System Can Hurt You:

I received a note from BMW yesterday indicating that my automobile includes the problematic airbag inflator on the driver’s side. This comes six months after I asked my dealer whether my car was involved. Their response: the manufacturer has not yet indicated whether your car is affected. I understand that the dealer was simply sharing their view of the facts at that point in time. Nonetheless, their response: “the manufacturer has not yet informed us,” was incomplete and unsatisfying. The implication for me as the consumer was either: “Whew, I dodged that one,” to “Hmmm, I wonder if this is a problem.”

I opted to focus on the potential problem, and at that point, I started sizing up my car before driving it with the care of someone scanning the occupants of a Chicago Elevated Train late at night. This change in relationship with my car is particularly troubling given our long love affair. You see, I only enter into long-term relationships with my automobiles, and until now, this has been a great one. At ten years and 50,000 miles, we are just getting started. Unless of course, the car turns on me, which is now a distinct possibility.

System Responsibility—An Anachronism?

Graphic with the words of Art of Managing and other management termsBefore describing BMW’s response to my particular situation, a bit of background is in order. I grew up in my career working in and leading systems businesses. We wrote software and in some cases developed and manufactured hardware, and we married the pieces together plus many third party technologies to deliver a complete system to our customers. Our systems were material to the minute-to-minute operation of the businesses of our customers.

We also took complete responsibility for the integrity and quality of our systems. That’s code for it did not matter whether there was a problem with something we had created or something we had integrated, it was OUR problem and we owned the fix. This was called in our vernacular: system responsibility.

Part of the process of ensuring system responsibility was working with approved third-party suppliers to establish quality standards and to plan and prepare together for the worst. We did not just hope everything would work out; we evaluated options and issues and made plans for catastrophes known and unknown.

When the worst happened, as it occasionally did, we always opted for the solution that reduced adverse consequences for our customers. In some cases, there was a short-term and long-term fix, but there was never a “We’ll get back to you at some point in time, but please suffer for now.”

These businesses moved heaven and hell to support their customers.

In today’s world, perhaps Apple comes the closest for ensuring system integrity with its very rigid approval process for the App store and for other related third-party products. However, having experienced some quality challenges with offering in the Apple ecosystem, it appears their response stops far short of our historic moving heaven and earth approach.

Contrast the system responsibility approach with BMW’s, which to my ears mostly has the odor of dodge, deflect and prepare for our future legal defense about it.

Here’s what they offered:

  • They sent a letter outlining the problem and indicating that they would fix it. Good.
  • At this time, there are no parts available. Bad.
  • They are not certain when parts will become available. Very bad.
  • Once parts were available, I would be notified via mail that I could call my dealer and schedule the update. Huh? Mail? Very bad. I might expect a text notice complete with timing options at my servicing dealer and the promise of a loaner car.
  • There were no countermeasures in the short-term. They could not recommend disconnecting the potential killing machine known as an airbag and they are not offering a repair, just a replacement at some unknown date. Miserable.
  • In calling the BMW Airbag Recall Hotline, they did their duty and acknowledged the facts and offered no solutions. No short-term countermeasures. No workarounds. And while they did not state it, the gentleman on the line did not disagree with my statement: “It sounds like the safest strategy is to park the car.” Abysmal.
  • The hotline offered: “At this point, there are no known injuries caused by this airbag issue for your model.” Is that really supposed to put me at ease? Poor form.

The implication of all of this is obviously that I drive the car at my own risk—something we all do every single day of course. The difference now is that I have to drive my car with the knowledge that my safety system is capable of hurting me. Yes, I get that cars are dangerous objects, but none of us signed up for this particular risk. In fact, I purchased this car because of its alleged remarkable safety ratings and features.

Just a Very Little Bit of Empathy with the Manufacturer:

Having been on the other side of quality issues at the manufacturer’s level, I can only imagine the nightmare this has created for every car company. And while the root cause of the quality issues is focused on Takata, the firms integrating their parts owe their customers something more than what they are providing. They failed to prepare for the worst. This is a failure of risk management and it seems a complete abrogation of their responsibility to their customers.

The Bottom-line for Now:

There is no sign of systems responsibility in this process. Heck, it feels like backpedaling mixed with a dodge and deflect strategy. The customers who are so important to giving life to the brand are suddenly made to feel ill at ease and even slightly adversarial. Instead of reinforcing their remarkable brand value and integrity, this firm has opted to risk it because they could not control or prepare for problems with a critical parts supplier.

I have enjoyed this car more than any I have ever owned, and at the purchase of one auto every two decades or so, I suspect I am lousy customer for BMW. Nonetheless, as Deming offered in his admonishment to focus on quality: What is the cost of a dissatisfied customer?

Now, I have to go plug in my trickle charger and spend some time detailing my car. It is in for a long sleep.

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Art of Managing—Change Your Field-of-View

Graphic with the words of Art of Managing and other management termsThe next time you get to the end of the roll of paper towels, instead of immediately throwing the cardboard tube into the recycling bin,  channel your inner kid and put it up to your eye and use it as an imaginary telescope. Admit it, you did it. We all did. Wrapping paper tubes were reserved exclusively for sword-fights with annoying siblings, and the paper-towel tubes made excellent telescopes for spying on these same characters.

The view through the cardboard tube is analogous to how many of us view our firms, careers and industries. 

Too often, we’re laser focused on the object in front of us; the next project, the next quarter or our annoying competitor, and our field-of-view is severely constricted. We fail to see the bigger picture until something from outside our narrow view of the world runs us over. It might be that disruptive competitor we scoffed at or the new technology that we never thought would stick. These unseen and unanticipated changes disrupt our firms and derail our careers with remarkable indifference.

I see and hear the result of this monocular vision in my work all of the time. As a strategy consultant, I engage with clients who spend way too much time looking through the paper towel tube. As a coach, I’m frequently approached by individuals who woke up one day to find out that everything they had been educated and trained for and were accustomed to doing no longer applied. These are more than sobering moments. For many, they are horrifying.

Standing still in this era with our firms, our strategies or in our own careers guarantees that you are moving backwards at the speed of change. While none of us on our own can stop the force of change, we can all do a better job scanning for trigger events and anticipating how these events might impact our firms, our industries and our jobs. The first step in this process is expanding your field of view (FOV).

8 Ideas to Help You Expand Your Field of View:

1. Make external scanning part of your normal operating routine. It’s essential to get more people on your team regularly looking for and talking about the world beyond your industry and customers. Encourage the team to look far and wide at new developments in other industries and geographies. Focus on identifying potential trigger events that have the potential to ripple through industries. As a starter exercise, spend time with your team mapping the potential ripple effects from autonomous automobiles across our society and even industries far removed from the traditional automobile ecosystem. 

2. Jump-start scanning by assigning teams to visit events in unrelated industries. Visit conferences and trade-shows in unrelated markets and look for the latest developments, innovative new technologies or emerging business models.

3. Consider using “association” techniques to stimulate investigation and idea development. Two idea prompters: “How would the Ritz Carlton reinvent our customer service approach?” Or, “How would Amazon use our data to improve our marketing?” Observing how innovative firms and market leaders in other segments execute their business can serve as a source of ideas for your business. Your goal isn’t to mimic those firms, but to identify approaches that you may be able to adapt to your audiences and that differentiate from competitors. Starter Approach: send cross-functional team out to observe the operations of these innovative firms and have them report back on their findings and ideas. 

4. Create a space to curate observations and foster idea generation. I’m a fan of curating content in a physical space. It might be a room filled with whiteboards or offering ample open-space for flip-charts. A physical location allows people to wander in and out and consider ideas and observations and add their own thoughts to the evolving discussions. If your team is dispersed geographically, place someone in charge of refreshing digital images or operating a virtual whiteboard.

5. Check your instinct to prognosticate too early in the process. While we all like to think we’re analysts able to assign probabilities to potential outcomes, focus initial efforts on discussions, not mathematics. Discussion prompters include: 

  • “If this materializes in our space, what will it look like?  
  • How will this impact our customers? 
  • How might we leverage this trend? 
  • How might we protect our business against this?
  • How do we get out ahead of it before competitors?

6. Cull the herd. Over time, winnow the events down to those the team selects as most likely to impact your space and firm. Shift the dialog to, “How do we defend against or leverage this?”

7. Create the mechanism to turn insights and ideas into actions. Create intelligent experiments out of the insights gained from scanning. Whether it’s scenario analysis, exploration of potential partnerships or acquisitions, or early stage research and development, the work of scanning must eventually move beyond conversation.

8. Keep refining and improving your processes. I’ve offered just a few of many possible approaches to external scanning. Strive to get more people involved. Allocate more time for discussions. Consider involving customers and partners in the “What if?” scenarios and draw upon their ideas. Don’t let this process stall or atrophy or, you will revert to your tube-like view of the world.

The Bottom-Line for Now:

None of us can afford to focus solely on the view from our conference room window. Other than the color of the grass or leaves on the trees, the view never changes. Work hard as a professional and as a member of your firm to find ways to expand your field of view. While you might not be able to alter the course of that storm bearing down on you, the advance notice will allow you to sidestep or leverage it. Both are better than being blindsided and crushed.

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See more posts in the Leadership Caffeine™ series.

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Art Petty serves senior executives and management teams as a performance coach and strategy facilitator. Art is a popular keynote speaker focusing on helping professionals and organizations learn to survive and thrive in an era of change. Additionally, Art’s books are widely used in leadership development programs. To learn more or discuss a challenge, contact Art.

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Dear Corporate—Why We Hate Your Business Reviews

hearnoevilIn my considerable time working for and around large firms, I’ve been on the receiving end of exactly one good, constructive business review with a team from corporate. That makes the score approximately 119 lousy experiences to 1 that was worth a damn.

I’ll rail at the lopsided majority in a moment, but first the one good meeting. This singular event was the visit from a high-ranking member of this global electronics manufacturer to evaluate our progress. He had been involved in helping start us a number of years earlier and now he was overseeing the broader organization and needed to assess where to invest or cut.

For two weeks ahead of the review session, the general manager of our unit went into hyper-panic, driving his troops to produce a seemingly endless stream of reports and presentations. All of the data was assembled, bound and carefully positioned on the table in the spot designated for our visiting dignitary.

The day arrived and the big man, all 5’3” of him, along with his entourage took their seats and the process began. After opening words from our GM, the big man asked about the stack of bound reports practically blocking his view to the rest of us. The GM explained what had been prepared and for a few moments, the big man was silent. Finally, in what shocked everyone in the room, he looked at the stack, pounded his fist down on top of it and exclaimed, “Excuses! Get rid of this paper and let’s talk about your business.”

For the balance of the day, we engaged in a thoughtful overview of the business, outlining our challenges and opportunities. The tone was respectful and the questions were tough, and the responses honest. A form of swift trust developed that allowed for open discussion on difficult topics. When it came time to talk about the need for critical investments in infrastructure and new product development, we received approval for most of our needs on the spot.

Graphic with the words of Art of Managing and other management termsFascinating. Priceless!

This meeting was in accounting vernacular, accretive. I’ll go so far to say that it energized our team to push harder. After all, we didn’t want to let down someone who had both respected us and provided support.

Unfortunately, as mentioned above, most of these corporate reviews are the exact opposite of motivational events. Here’s why:

6 Ways the Team from Corporate Destroys Value During Business Reviews:

1. You’re approach suggests we’re guilty until proven innocent. Most business reviews by corporate staff assume that the division company is guilty of crimes ranging from gross mismanagement to the kidnapping of the Lindbergh baby. These sessions are extended trials where the goal of one side is to convice and the goal of the other is to escape the hangman’s noose, at least until the next review. Great for morale!

2. You assume we are morons. And why wouldn’t you? We’re running this little tiny business and you oversee a giant megalopolis with hundreds of minions doing your bidding. Clearly, you’re smarter than the rest of us who have invested decades of learning our industries and vocations.

3. Every line of inquiry compels us to justify why we are drawing air and taking up space on this planet and in your company. These meetings are often nothing more than a requirement that we re-justify our existence in your corporate universe. Instead of transparency, these events turn into something resembling a farce at best or a bad tragi-comedy at worst.

4. You preoccupy on cells in spreadsheets without context for the numbers. I’m sorry, but no matter how hard you beat us over the head with that particular number, it’s not going to change in this meeting. We promise to work on it for the future, and we’ll tell you how, but make your case, set your expectations and let it go. That cell is not a crime against humanity or a personal affront to your very existence.

5. You don’t make an effort to understand our business. You critique our strategy without context for our markets, clients, prospects and competitors. And you suggest where we’re weak on talent and process, without having spent any time working in the business. You’re ignorance is showing, and it isn’t flattering to you.

6. You’re tone is exclusively, “what have you done for me lately.” It should be, “how can we better support your strategy?”

The Bottom-Line for Now:

I’ve attended, participated in and led productive and positive business reviews in a variety of settings. It’s the ones in the global conglomerates or highly divisionalized organizations with disconnected staffers or senior executives that seem to take on the personality of the sessions described above. For everyone involved in leading these reviews, start with showing respect and work towards establishing trust. After trust comes transparency about the opportunities, challenges and tough topics. If it never reaches this level, it’s just a waste of the precious time in our professional lives.

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Art Petty serves senior executives and management teams as a performance coach and strategy facilitator. Art is a popular keynote speaker focusing on helping professionals and organizations learn to survive and thrive in an era of change. Additionally, Art’s books are widely used in leadership development programs. To learn more or discuss a challenge, contact Art.

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Leadership Caffeine™—Leading Your Peers

image of a foam coffee cup with brown outer sleeveMost of us don’t think about leadership and leading in the context of our peers. After all, by definition, there’s no hierarchical relationship between group members. Conventional thinking suggests our peers are our teammates, our colleagues and our fellow managers or executives, not people we’re supposed to lead.

That thinking is nice, but naïve, if you’re intent on doing more for your firm while bolstering your career prospects.

Consider:

  • Groups of peers are not groups of equals in terms of power, political savviness, capabilities or aggressiveness. They’re a collection of heterogeneous personalities with diverse and often divergent interests.
  • Peer groups are headless. In an effort to remain collegial and respectful, few but the bravest of souls venture into the realm of assuming leadership for these teams. Push too far and too fast and your peers will momentarily unite to push back at you. “Who are you to suggest what WE should do?” On the other hand, these groups are ripe for “benevolent” and issue-focused leadership.
  • Peer groups of managers are typically not highly functional or contributory entities in most organizations. Management “teams” are simply a team in name only. Your fellow managers likely share information and updates at operations reviews and provide input in strategy sessions, but they don’t do much together that creates tangible value.
  • The opportunity for improved collaboration between peers is very real. The potential for these groups to create value around the right issues—strategy execution or problem solving in what I term the “gray-zone” between functions, is incredible. The operative word is, “potential.”

7 Steps to Help You Assert as a Leader with Your Peers:

1. Know that “trust” is your currency in-trade. If you’ve cultivated solid relationships based on showing respect, offering your trust and delivering on commitments, you’re starting from a good position. Friendly advice: if you’ve engendered something other than trust across your relationships, stop reading now and give up on this idea of asserting your leadership with your peers. If you need to strength your currency reserves of trust, focus on number 2, reciprocity.

2. Grow your accounts receivable balance for reciprocity. Reciprocity is second in value only to trust. The essence of reciprocity in an organization setting is: If I help you, you have an unspoken obligation to help me at some time. Give first to get later.

3. Focus your peer-group leadership efforts on gray-zone issues. The problems in the gray-zone are those process inefficiencies or bottlenecks that no one department or function owns. They exist between functions. Identify one of those items and build the case for cross group collaboration to solve it.

4. Create heroes out of your group members. Keep the spotlight on the contributions of your peers and their teams, even if you were the one to organize the problem-solving effort. Remember, you’re playing the long-game and you will benefit from shining the light brightly on others.

5. Practice shuttle diplomacy. Most of us interact with peers more by exception than design. Make certain to build time into your schedule to check-in, share ideas or offer your help.

6. After some victories solving gray-zone issues, raise the stakes by focusing on strategy execution. The gap in most firms between the ideas of strategy and the coordination of strategy execution is Grand Canyon-esque. This is a great place to direct the energy and gray-matter of a peer group that has recently cultivated a track-record for solving problems together…with your guidance and yes, your leadership. Focus the group on the issues of coordination and communication essential to implement new programs and monitor results.

7. Assert as a peace broker for border skirmishes. Armed with ample trust and a strong accounts receivable balance of reciprocity, pay attention to and help your team members navigate differences. By your de facto leadership of the group around key business initiatives, you’ve created the basis for shared interests between members. Appealing to and leveraging those interests is a powerful tactic for resolving differences of opinion or approach.

The Bottom-Line for Now:

For anyone waiting for the guidance on the “Frank Underwood” (House of Cards) power-play in this post, I’m sorry to disappoint you. Leading your peers isn’t about collecting power to feed your ego. Rather, it’s about tapping into the potential of your colleagues to solve problems and move the performance measures in the right direction. After all, the best leaders have something larger in mind than their own personal interests. And yes, get this right and you will be noticed and you will benefit.

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See more posts in the Leadership Caffeine™ series.

Read More of Art’s Motivational Writing on Leadership and Management at About.com!

Art Petty serves senior executives and management teams as a performance coach and strategy facilitator. Art is a popular keynote speaker focusing on helping professionals and organizations learn to survive and thrive in an era of change. Additionally, Art’s books are widely used in leadership development programs. To learn more or discuss a challenge, contact Art.

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Yahoo Misfires—Don’t Let this Happen to Your Firm

Cartoon image of a business meetingYahoo—a name left over from the boom and bust period of the dot.com world—has somehow managed to limp along in a world where many struggle to understand its value proposition. The financial markets vote with their valuations, and have recently concluded that the firm is worth no more than its holdings in the high-flying stock, Alibaba. Stated another way, the financial markets view the core Yahoo business as effectively worthless. (Note: as of this writing, there’s a good deal of swirl but little clarity surrounding the potential disposition of the Alibaba holding.)

The December 2015 issue of Forbes includes an interesting article, entitled: “The Last Days of Marissa Mayer?” Mayer is the firm’s CEO, and a former high-flying and early-stage Google Executive who has served as the face of Yahoo and the firm’s turn-around efforts for the past three years. If the article and sources are accurate, Mayer is failing as a manager and as a leader, and a big part of that failure is around the hard work of strategy.

In my recent post on strategy, I focused on the importance of the heavy lifting necessary to develop a clear, accurate diagnosis as a critical first step in building a coherent plan. The subsequent step, what strategy expert Richard Rumelt describes as, defining the “guiding philosophy,” builds on the diagnosis to frame the general approach to the situation. It’s the combination of the diagnosis and guiding philosophy that give coherence to the subsequent actions designed to seize opportunities and blunt threats. Anything short of clarity around both of these, and the prediction is in the immortal words of Mr. T, “Pain.”

The article in Forbes highlights in a very visual form the departure of key leadership and technical experts, and it reports (albeit from mostly anonymous sources) the growing frustration, tension and emotional responses to the lack of strategic clarity for the firm. The firm is in pain, and perhaps it is in its death throes. While creative destruction is inevitable in our world of change, one wonders whether a firm with the name and eyeballs of a Yahoo is aggressively striving to snatch defeat from what could be a victory.

In my work as a strategy adviser and facilitator, I see the impact of firms avoiding the hard work, introspection and experimentation that should surround an on-gong strategy process, all too often. Almost without exception, the issue is that top management has failed to take the time and put forth the effort to properly diagnose its situation. I listen to top executives and hear disparate views on the challenges and opportunities. I listen to them for clarity and unity on how they propose to move forward, and what I hear ranges from silence to cacophony.

The Bottom-Line for Now:

The failure of any business is a sad affair. There are people and families and careers and dreams attached to our businesses, and when those are squandered due to ego and pride and unhealthy politics or worse yet, due to managerial laziness, it’s reprehensible. You owe it to your team and your firm to be a positive voice and catalyst in pursuit of strategic clarity, coherent actions and healthy, constant communication.

Read more in the Art of Managing Series.

Art Petty serves senior executives and management teams as a performance coach and strategy facilitator/adviser. Art is a popular keynote speaker focusing on helping professionals and organizations learn to survive and thrive in an era of change. Additionally, Art’s books are widely used in leadership development programs. To learn more or discuss a challenge, contact Art.