Autonomy for as long as possible

This continues on from my previous post on "Reorganising for performance"

Wiktionary defines autonomy as "The capacity of a system to make a decision about its actions without the involvement of another system or operator"

Autonomy removes the interdependency delays 
The involvement of "another system or operator" is a decision or action external to the process.  The moment such an external decision or action is needed, it is just that, it is external i.e. the parties required for the decision or action don't know the current state of what's happening internally to the process and must first educate themselves on the state before being able to act.  Autonomy encourages agility – interdependencies create queues and loss of focus.

Autonomy introduces energetic proactivity
More importantly, external decisions and actions remove responsibility and accountability, leaving a sense of fatalistic surrender on a sinking ship.  In the post-mortem there will always be fingers pointed and good reasons why the customer was not served or the product did not get to market in time.  Autonomy encourages simplicity – interdependencies create complexity and loss of clarity and control.

Being forced to wait for corporate to validate the technical content of a sales proposal is fair reason for missing the tender deadline.  Being unable to wade through a 300 page technical proposal in a day before the tender deadline is fair reason to not validate it in time.  We can force these situations to work, but to do so would be to go against the Tao (Way of life or the Moral Law).  Find ways to sever the interdependencies.

Autonomy is time related
Autonomy for as long as possible.  In the long run, even a company is not entirely autonomous, impacted by economy, government etc.  It's only a matter of time before these impact the company.  Even more so for the autonomous organisational units within a company.  At some point, major expenditure must be authorised, decisions must be made within the context of a broader perspective etc.  Autonomy is therefore time bound. 

The value to be applied in reorganisation decisions is to maximise the length of autonomy, make the unit autonomous for as long as possible.

Autonomy is outcome related

The aim of an autonomous unit is an outcome, a service rendered in its entirety, a product delivered in its entirety.  To define the different units therefore requires that the outcomes be defined.  If a defined outcome is too large to be delivered by any particular unit, the outcome will have to be broken down and redefined.  Maintaining the outcome and arranging different units to deliver on the outcome will sacrifice autonomy.

The value to be applied in reorganisation decisions is to minimise the number of units involved in the delivery of an outcome, the fewer the better.

Autonomy is input related
Autonomy is limited by the power the unit has over its inputs.  The fewer the inputs it has and the greater the power over those inputs, the more responsive the unit will be.  Much has been written in past years regarding internal customer/supplier relationships. I don't believe in them. They must be minimised wherever possible.  Customer/supplier relationships imply interdependencies, they require contracts (whether explicit or implicit), contracts lead to internal litigation, internal litigation doesn't serve the external customer and doesn't make the unit any more responsive.  We can force it to work, but to do so would be to go against the Tao.

The value to be applied in reorganisation decisions is to minimise the number of inputs needed by a unit to deliver their output and maximise the power the unit has over those inputs.

Autonomy is skills diversity related
Multiple skills will be required to deliver on an output.  This means that functional units of sales, engineering, accounting won't make it.  These functions will need to be split up to form autonomous units.  Unit managers need to manage a diversity of skills within their units.  As units are broken down into teams, team members need to stand in for each other and take on a greater variety of tasks.  Units need to be multi-disciplinary and team members need to be multi-skilled.

Obstacles to Autonomy

The obstacles to autonomy always relate to something common and shared that has not been or can not be split between the units in a way that provides independence.  It could well be that this common and shared something is indeed unsplittable but this should be examined and challenged ferociously. 

Invariably the reasons given for centralised, shared and common somethings/resources are:

1. resource efficiency (economies of scale) - shared resources
2. competance development - shared knowledge
3. functional coordination - shared customers/suppliers

The benefits that each of these provide should be challenged against the cost in the loss of responsiveness that they will result in.  For each centralised shared resource installed, at least one more input will be added to each unit relying on that shared resource.  The following can be used to minimise the impact of shared resources:

1. Resource efficiency

Resource efficiency smacks very much of the production machine efficiency thinking responsible for the ineffective production methods used by, and the near downfall of the US auto makers of the '60s to 80's.  Toyota developed it's production system in Japan to become responsive to customer demand by implementing just-in-time, kanbans, pull flow, fast change-overs and a whole host of techniques described in lean production and lean thinking.  If resources cannot be split up, they must be driven by lean principles to make them responsive to the units that rely on them.

Decoupling the autonomous units

The shared resource becomes a unit of its own, with clearly defined deliverables. 

Wherever possible, the shared resource should produce components (either physical or services) that are included in a total solution that is the responsibility for another autonomous unit. 

Wherever possible, use a kanban between the two units to decouple them.

Wherever possible, the unit furtherest from the customer should not be in the immediate return loop of the unit closest to the customer.  This means that the unit closest to the customer must have enough autonomy to respond at least with a temporary solution, answer or offering whilst the unit furtherest from the customer works on something more long term.  I refer to this as temporal decoupling.

2. Competence development

The development and maintenance of competance relates to the spread of expertise, lessons learnt and best practice know-how in the organisation.  If there is enough benefit in developing common and shared expertise between different units e.g. engineering this can be achieved by a central role that coordinates the engineering across the units, either purely coordination or as strong as a matrix type organisation.  As always roles and responsibilities need to be very well documented and implemented in a matrix type arrangement.  Each such central position must be challenged ferociously for the value it adds to prevent corporate bloat and overhead.

3. Coordination

Where coordination between units is required to prevent competing for the same customer or to ensure supplier consolidation to increase negotiating power, in a similar way, a central role that coordinates these activities across the units in a matrix type organisation may be the best alternative.

Reorganising for performance

Finding your North Star

We reorganise in pursuit of improvement... an increase in performance.  To find your North Star you must be able to immediately and clearly verbalise what performance you want to increase.  Efficiency, innovation, customer service, profit..?  What is it that we seek to improve?  The answer to this question is your North Star.  This may seem a no-brainer question, but without a good clear answer to it, you will not find your Southern Cross.  One I always like to refer back to is "responsiveness".  Whether it's to respond with a new product to an opportunity for innovation, a delivery when an order is placed, an answer when a question is put, a defence when an attack is made, an organisation that cannot respond with sufficient agility will die. The definition of "sufficient" is determined by the market.

Responsiveness has often been my North Star when reorganising.  Efficiency, innovation, customer service, profit etc. have always flown from that.

Finding your Southern Cross

So if responsiveness is a North Star, where does one begin with reorganisation?

As one begins to explore the many options and possibilities, the relationships and interdependencies presented not only by existing internal processes, but also external organisations like customers, it's easy to get sunk in a quagmire of complexity.  How does one make the right decisions when you're deep down in the detail of the pros and cons of decision?

When going through any reorganisation, I always look to a set of core values which line up with the North Star against which to optimize an organisation, a kind of guiding Southern Cross if you like.  This helps me make decisions when I am in the details and faced with complex and difficult choices.  

How does this particular choice increase or decrease each of the values in this core set.  Figuring the answer to that question always sets direction and clarifies the choice.  It'll help you make the right decisions, not perfect decisions.

When reorganising for responsiveness, the stars in my Southern Cross are:

1. Autonomy for as long as possible

2. Decentralised decisions as close to the action as possible

3. Visibility and measurability of outcomes

4. Co-location

5. Autonomous unit sizes as small as possible

There are other values that I can add to the list, but I have limited the stars to five.  They are prioritised.  There are only five bright stars in the Southern Cross.  Adding more to your Southern Cross will only make you loose focus, something your Southern Cross is precisely there for to help you keep.

I will expand on each of these stars in my next post.  It would be good to have your views.