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THE PRODUCTIVITY SOLUTION: John Lewis boss nails the pathway but what about addressing the systemic problem?

As the boss of one of the UK’s most successful companies, Sir Charles Mayfield’s view of the country’s most pressing business problem is important. So his “more micro-approach” (Sunday Telegraph, December 17,2017) to show how employers can boost their stubbornly low output should make the Government – and of course managers themselves – sit up and take better note.

Against the reality that employees in countries like the US, scan for productivity articleGermany and France continue to produce their widgets cheaper, faster and/or better than their UK counterparts, Sir Charles, of the John Lewis Partnership, has an answer. Instead of the Government trying to boost entire industries with grandiose investment plans such as those set out in the new industrial strategy, his approach would be to put the responsibility for productivity growth squarely on managers. Individual employers, he says, must be encouraged to improve their own performances by, for example, pairing productive companies with unproductive companies so that managers can identify problems and share ideas on how to make the most of their staff and equipment. If the productivity of the weakest businesses could be brought up to the strongest, Britain’s performance would improve dramatically, he says.

Quite coincidentally, Sir Charles’s ‘coal-face’ fix to the UK’s low productivity is identical to the forgotten 30-year-old advice given by the UK’s very own management guru, the late Peter Drucker, who counselled that “It is only managers – not nature, laws of economics or government – that make resources productive.” (The new productivity challenge, Harvard Business Review, Nov/Dec, 1991, Vol 69, Issue 6). But the ‘Be the Business’ campaign within the Government’s new Productivity Leadership Group, of which Sir Charles is chair, does little to address the more systemic problem that besets modern industry and commerce – the flexible labour market’s unnoticed flaw, which impacts every single employer.

While the short-tenure workplace has allowed employers to more flexibly adapt to fast-changing environments and circumstances, it has also imposed the unexpected downside of cutting employee output. Workplace disruption has increased dramatically, the employers’ unique knowledge and experience is constantly being dispersed and old-style organic growth has been dislocated.

Flexible working’s original postulation was that employers would also be able to benefit from an employee base that would provide much wider experience. In reality, replacement employees, even if better qualified, are never seamless in their employment. Additionally, second-hand experience doesn’t always work well WITHOUT the awareness of the acquired wisdom from employer-specific practice. To survive, organisations need to remain unique in their development but the continual replacements that flexible working has delivered invariably waters down original corporate advocacy, a phenomenon that arguably contributes to Thomas Malthus and David Ricardo’s law of diminishing returns.  

Short tenure’s combined effects can been seen in the pandemic of repeated mistakes, re-invented wheels and other unlearned lessons that litter the workplace and a Proudfoot Consulting estimate that put the overall cost of wasted productivity in the UK at 7.5% of GDP in 2005.

Surprisingly, the 40-year-old flexible labour market’s unacknowledged downside has not been comprehensively addressed save for the futile efforts to reduce the levels of staff churn.

In simple terms, combatting the dysfunctional effects of flexible working involves capturing and sharing the employers’ unique knowledge and experience before it walks out of the front door, specifically the important contextual ‘how’ and ‘why’ of know-how that more tacitly characterises the way the employer does its business and which does not find a place in corporate data banks. Having provided rolling generations of new employees with this more comprehensive evidence base, it is then necessary to top up the employers’ in-house training with the largely untaught skill of Experiential Learning to enable new employees to better apply this and their own prior practice to their new employers’ new environments and circumstances. By enabling better decision-making, it’s the key to better productivity.

High staff turnover may not be as evident in the matchless John Lewis Partnership but the average jobs churn across the UK’s industrial spectrum in today’s workplace is now between four and five years. This includes many of the more productive companies to which Sir Charles alludes, suggesting that they, too, are operating at lesser output levels than otherwise possible. As such, addressing the downside effects of flexible working would constructively impact on ALL short-tenure companies.

In addition to mending single unproductive employers, would it not be more productive to also comprehensively encourage the employers’ OWN experiential learning solution to one of the biggest of productivity’s underlying problems? dot

Why employees – even the best – CAN’T excel in today’s modern workplace

It’s widely acknowledged that employees in many industrialised countries have become less productive, in spite of business education and training never more available. The instinct is to blame their education or employees themselves but consider this: their output deficit is directly linked to the imposed change in the workplace that rug2the experts still consider to be of unquestionable benefit – the flexible labour market. 

Introduced in the 1980s to help employers better cope with the rapidly changing marketplace, flexible working has hosted short tenure employment at every hierarchical level, with individuals now averaging eight different employers in their working lifetimes (in the US it’s higher), and rising. This four-to-five year employment duration has introduced widespread jobs disruption and little employee loyalty, with several systemic outcomes.

Firstly, up to 12 months at each end of every replacement employees’ tenure is typically worked at lesser productive levels, which automatically reduces the period of optimum output by a significant margin. Secondly, few of the many corporate functions within organisations ever survive without one or more employees leaving and a replacement arriving, heralding the breakdown in the way most progress occurs – organically, i.e. from the uninterrupted building of one experience on another. Thirdly comes the most dramatic consequence of all for the way good decision-making happens; exiting employees take with them much of their employers’ unique knowledge and experience, including their important tacit know-how, foreshadowing the onset of what’s called corporate amnesia, when businesses and other types of co-operative organisation lose their memory of how they do things in their own special way. 

In addition to constantly diluting individual corporate cultures in an unmanageable way, this dramatically reduces the relevant evidence base with which replacement employees would otherwise need to make good and better decisions on behalf of their new employer. In effect, they end up utilising mostly the knowledge and experience of their prior employers and education, much of which is unrelated according to their employers’ unique selling point (USP) and experience and, anyway, is subject to inherent short, selective and defensive memory recall.

A more familiar scenario to employers is the same way knowledge loss occurs when employers host in-house training schemes. No sooner than up-skilling is effected, individuals move on. More often than not, training courses have to be repeated to maintain the skills base. The only other way such additional skills can be maintained is if replacement employees have been similarly retrained.

There is also an element of replacement employees consciously disassociating themselves from their employers’ prior experience (“not my responsibility!”). Even top-flight employees become disadvantaged, explanations for the many repeated mistakes, reinvented wheels and other unlearned lessons that now litter the modern workplace.

With jobs disruption and the absence of institute-specific evidence upsetting almost every job and every employer, EVERYTHING has slowed, exactly as the productivity scores in many countries show. Its pervasive span across the workplace, which is where commerce and industry’s main factor of production works, makes its overall effect truly impactful. Ironically, the disarray is as serious as it is strangely unnoticed, an outcome diminished by the futile efforts to unsuccessfully reduce the rate of staff turnover, which has never been higher.

Hence the conclusion that the flexible labour market is not all good, in fact it’s pretty wanting.

Conventional approaches to induction and onboarding are similarly superficial while mentoring and internships, the more resourceful of the solutions to short-term working, are still too rare to make much of an impact. In truth, they’re all good examples of managers electing to address the proximate, rather than the ultimate, cause.

For a Trump-imposed US, a Brexit-motivated UK and other productivity-thinned countries whose domestic harvests need to be improved to replace cheaper labour competitors overseas, what, then, needs to be done to counterbalance the admittedly useful flexible labour market?

It’s not rocket science but the answer nonetheless fills a huge hole in workplace practice and business education. In short, a collaborative effort by employers and educators is necessary to ensure that replacement employees can offset this unseen delinquent development.

Employers first need to capture their unique know-how before it walks out of the front door and then ensure that their replacement employees have access to this corporate evidence in an easily accessible and digestible format. The referred unique know-how is essentially a part of the overall knowledge substructure that is barely acknowledged by Western managers and many business academics. It differs from the so-called explicit knowledge that typically appears in organisations’ data banks by being the non-technical ‘how’ of getting things done. Also known as coping skills, its expression is implicit, ambiguous, interpretative and predictive, with its learned deductive character allowing its owner to understand the implications of information and act accordingly. It is also deeply rooted in ideals, values and emotions and is an essential part of the evolutionary process of applying prior experience to new circumstances, what educationists describe as ‘turning old knowledge into new knowledge’. It is difficult to capture but best done through oral skilled debriefing techniques rather than own-authored accounts.

With the employers’ knowledge and experience captured, business educators then have to step up to help host organisations to add true value to this body of knowledge – by enabling decision-makers to APPLY this experience to changed circumstances and environments. Conventionally, decision-making is taught as a one-size-fits all approach, a methodology designed for the old-fashioned workplace where individuals were long-standing employees supposedly aware of their past practice. Today’s workplace has upturned this orthodoxy, removing much of the employers’ personalised knowledge and experience. To do this, they have to introduce a new skill to how they teach individuals to make good and better decisions – the ability to learn from experience.

The theory and practice of Experiential Learning (EL) is already known, academically-acknowledged models of which include methodologies devised by its main proponent, Ohio’s Case Western Reserve University’s Professor David Kolb, more than 35 years ago. Ironically refined at around the time the flexible labour was being devised, its raison d’etre is “critical reflection based on concrete experience”, a widely ignored feature of traditional business education that is exposed in the attitude of many Western managers who, as a general rule, think little of the long past or the longer future but find safety in short views.

Imagine what modern, ‘walkabout’ and related employees could do if they had access to the hard-won and expensively-acquired knowledge and experience of a departed chief executive, an HR manager, the factory supervisor, even other key operatives, beyond their actual employ …..?

This new approach to using knowledge necessitates dealing with a range of newfound issues, among them persuading business people, especially in the Anglo Saxon world, that the precedence of history – and especially one’s own employer’s history, whether successful or otherwise – is a valid decision-making tool, even (and especially in) in a fast-changing environment. This goes to the heart of the debate between those who think that industry and commerce can learn from the past and those who think that old lessons are misleading or irrelevant because times change.

Then there’s the underlying and probably the most acute issue of all. It’s the question of who owns the knowledge and experience that employees acquire in their employers’ service – the employee, the employer or is it jointly owned by both parties? If the former, does the employee have a proprietary right to withhold its capture by an employer, an attitude actually tacitly held by the modern worker? In the past, when employees were generally long-term, the question wasn’t as exigent. Today, it’s both relevant and decisive to ensuring efficient continuity in today’s merry-go-round workplace. Does the fact that the knowledge and experience acquired in an employers employ is PAID FOR by that employer now settle the question?

Alongside this, employers will need to know how best to identify their important knowledge and experience, how to persuade existing employees to share their experiences, and how best to capture their memories and the stories of the institutions in which they work.

Against the background of high staff turnover, the methodology’s perspective shifts the emphasis so that learning’s benefit to decision-making is corporately centered and reinforces the universal conception that progress is mostly incremental and continuous. Connecting youth with business experience is a vision that surely also accords with educations’ wider role.

Flexible working is not an ogre as such. It has its place but its dramatic consequence of restricting replacement employees to just applying others’ experience is, simply put, not as good as also applying one’s own employers’ experience. As such, this unintended consequence of Adam Smith’s invisible hand needs to be better addressed. dot

Learning how to learn: The case against ‘UNLEARNING’

There’s an important issue that keeps on coming up on relevant business groups on Linkedin. It’s whether it’s necessary to UNLEARN in order to learn. It seems that to make progress, one has to actively ‘delete’ existing knowledge andunlearning3 from the intellectual knowledge base.

Is the word unlearning a misnomer? Is it an unfortunate description of one of the technical and philosophical confusions of how best we can and should learn? Does it confuse and disrupt the process of erudition? And does it negatively affect the quality of decision-making?

I’d like to subscribe to all of these portrayals alongside it being a part-explanation for why we’re so bad at implementing change and, indeed, why we don’t learn very well from experience.

The connotations of self-styled unlearning requires individuals or organisations to erase or forget prior knowledge and experience from their consciousness, effectively throwing away the intellectual evidence that delivered prevailing outcomes to date. To do so – as many are taught to do – there are a number of interrelated issues that also upset the process of actual learning.    

To ‘unlearn’ means one has first to be aware of the historical evidence. To go through the process of demolishing part of an evidential base and then re-constructing it is extremely wasteful. Rather, APPLYING it to changed environments and circumstances – my preferred description of the learning process (see biggernumbers.wordpress.com) – is surely more constructive, a methodology that’s not yet fully accepted as the more suitable way to engage the process of ‘moving forward’.

It’s acknowledged, anyway, that the best way of making progress is organic – i.e. the building of one experience on another. So, removing the older experience – even if it didn’t turn up trumps – is just disruptive and hamstringing to the whole determination process, like the insensitive imagery of having one’s legs unnecessarily amputated at the knees.

In learning terms, the ‘deleted’ knowledge and experience also means that the presence of any historical perspective becomes unavailable, as does the opportunity to factor in another important factor in the decision-making process, precedent.

Moreover, the reasons why past decisions were taken were because they were once thought relevant. As such, the evidence remains pertinent for the reasons at the time, so unlearning it only reduces the evidential base and, in the process, increases the chance of repeating mistakes, reinventing the wheel and not learning past lessons.

And finally, it can also be argued that in today’s highly flexible labour market, walkabout employees reduce the organisations’ evidential base even further, making good and better determinations even more uncertain.

The alternative to unlearning is the acknowledged methodology known as Experiential Learning (EL), which specifically rejects the theory of removing any part of corporate body intellectual. Its methodology is to employ constructive reflection to the more comprehensive evidence base. As indicated, it is still little used in favour of the traditional one-size-fits-all approach to decision-making formulated for the old-fashioned and inflexible workplace when employees rarely moved away from their employer.

The reasons aside why employers and business educators have been slow to adapt to the new workplace, learning is unquestionably an essential component of decision-making. As such its importance to good decision-making shouldn’t be under-estimated, under-resourced or stripped of its raison d’etre. It might seem subtle to some but to unlearn is a supremely negative way of defining what the discipline is all about.

Bottom line, a truncated evidential base is no friend of good decision-making. Many educators and employers need to rearrange their mind sets …. dot

The Big Question: What Lessons from History Keep Being Forgotten? HELP WANTED!

I’ve just read a motivating Paper published by the Swiss science-orientated university, ETH Zurich, on how a knowledge of history is “the best education folessons not learned 1.pngr those who aspire to change the world” (http://www.css.ethz.ch/en/services/digital-library/articles/article.html/5df93f32-73b6-4ae2-a0e8-92b63c0e9dbb).

The examples are short and all are related to POLITICAL events in different countries.

It strikes me that a similar BUSINESS-related Paper could also be put together. I’m happy to do it but rather than hog the project myself, I’m suggesting that I write one example and around a dozen of you also contribute.

Like the ETH example, you don’t have to be an academic. My idea is that we keep to the same format and length – i.e. be very short and very succinct. What would be especially interesting is a fresh collection of different geographical and/or industry-related examples such as the recurring mistakes of, say, a European, American or Asian country
 or the unlearned lessons of food manufacturing, healthcare provision and high tech. For corporately political reasons the examples of own-employers are probably excused but, hey, here’s where the bulk of examples flourish in the undergrowth.

In addition to bringing timeworn case studies up to date, I’m thinking it would be enlightening, especially useful in today’s globalised marketplace and, importantly, also provide excellent ammo to get more of our business educators to use the concept to much greater effect. We all know how unfashionable is the ‘old’ to business.

I’m confident there are enough proponents of the underlying concept of good history as a decision-making tool and plenty of examples to illustrate it. Through my personal regard for Experiential Learning (EL), a subject that this blog deals with extensively, my own conviction is that without history’s awareness (in business I call it organisational or institutional memory because of managers’ aversion to the lexis ‘history) the evidential base is necessarily constrained, a characteristic that diminishes the ability to APPLY tried-and-tested practice to new environments and circumstances. In other words, it diminishes the quality of decision-making.

If the idea appeals, proposals please to ak@pencorp.co.uk I’ll keep responders informed of progress …dot

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Posted November 5, 2016 by Knowledge Management

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