On Jan. 21, 1988, a senior General Motors executive, Elmer Johnson, wrote a memo which accurately anticipated GM's key challenge in transforming the company: “We have vastly underestimated how deeply ingrained are the organizational and cultural rigidities that hamper our ability to execute.” One of GM's synergy initiatives focused upon consolidating and standardizing support for IT resources. To achieve this goal, GM utilized Electronic Data Systems (a part of GM from 1984 to 1996). Although one of EDS's primary goals during this period was to 'moving the automaker onto a common supply-chain tracking system', after considerable efforts, and nearly 10 years of extra resource allocations, this goal continued to aluded them. Despite this, EDS continued to provide significant IT services in a follow-up contract in excess of $1B dollars.

Some activities can benefit from access to assets that that no single user should consider making on their own, becaue the barriers to entry are too high, or their utilization would be too low to be able to cost-effectively make use of. An interesting example such an asset nearly all of us use can be found in our transportation infrastructure, where debates about mass transit have been underway for years. 

The benefits of ownership and use of private vehicles are perceived quite differently across individuals and cultures, and vary considerably depending upon the distance from home to work, the congestion within the available network, the frequency of usage, the availability of investment funds, the pleasures of driving (at least, under the right conditions), and the value of one's personal time. Related factors may also include less tangible benefits, such as the freedom to use transportation sponteneously, a desire for personal independence and the value of convenience. 

Synergy is the idea that the whole is greater than the sum of the parts. It is the presumption behind most business mergers, and the motivation behind many top-down efforts that encourage independent groups to work together. But true synergy is not easy, free, or even possible without the right environment. Consider this cautionary note:  

Synergy bases it's value proposition on two concepts: aggregation of the needs for a defined set of users (to achieve economies of scale) and reuse of knowledge and assets to service those needs (for cost avoidance, and to share the best available solutions and strategies). The component elements targetted for reuse can take many forms, including the sharing of tools, technology, processes, concepts, people, and information.

The ability to realize value from such synergy rests upon a number of assumptions:  read more »

The team members on engineering development projects often use language whose meaning is ambiguous. Unravelling the possibilities underneath these communications patterns can be quite challenging, but if you don't confront and solve those challenges, it can cause considerably more pain later, as eventually, these misunderstandings must be reconciled. You have to look no further than the financial crisis of 2008 (and counting) for examples.

Development relies upon effective communications, and achieving this must involve agreeing on a common, foundational understanding for key concepts that are threaded through such projects. Experienced members often may develop a 'cultural awareness' of such concepts after participating for some time on a team, after a clear concensus emerges, but newcomers may still not be able to discern what that meaning is, until it is explained to them. Such understanding usually requires careful listening, disciplined and coherent integration of concepts expressed by many stakeholders over time, and clear and thorough validation of the implications behind the emerging meaning, in different situations.   read more »

A timeline is a retrospective representation of a linear sequence of significant events which have occurred during the accomplishment of some activity. A timetable provides a corresponding, forward-looking series for pre-arranged events, and is often organized as a tabular list. Such timetables are used to plan and track such activities for performing and reporting on future work. Each of the events associated with these timelines and timetables may be comprised of either top-level milestones or more detailed inchstones.  read more »

In the summer of 1982, large American banks lost close to all their past earnings (cumulatively), about everything they ever made in the history of American banking—everything. They had been lending to South and Central American countries that all defaulted at the same time—“an event of an exceptional nature.” So it took just one summer to figure out that this was a sucker’s business and that all their earnings came from a very risky game. All that while the bankers led everyone, especially themselves, into believing that they were “conservative.” They are not conservative; just phenomenally skilled at self-deception by burying the possibility of a large, devastating loss under the rug. In fact, the travesty repeated itself a decade later, with the “risk-conscious” large banks once again under financial strain, many of them near-bankrupt, after the real-estate collapse of the early 1990s in which the now defunct savings and loan industry required a taxpayer-funded bailout of more than half a trillion dollars. The Federal Reserve bank protected them at our expense: when “conservative” bankers make profits, they get the benefits; when they are hurt, we pay the costs.

- Nassim Nicholas Taleb, in The Black Swan, April 2007  read more »

Faith and hope are as much a part of political reality as they are in change programs within businesses. As I reflect on the daily political landscape that pretends to offer us information to make sense of the 'most important issue' in the upcoming election (the economy), I offer the following two articles for your consideration. I think these two articles are important to digest together. Both have the feel of the kind of unbiased analysis, reflective discourse, and unvarnished truth that must accompany any true reform in our national debate on such topics (a reform that is desparately needed).
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There is no longer much public debate about whether global warming is occurring or not. Articles like 'Mass extinction study casts cloud on future' paint a bleak picture of what lies ahead for the earth's population. But wait, if the future is cloudy, wouldn't things be cooling down?

My flippant remark is intended to reinforce that it is sometimes a bit hard to sort out sensationalism from hard science in policy-making for significant issues in society; too often, there is a 'rush to judgement' regarding major changes, when history indicates that such haste is rarely necessary, and when it is, the related decisions have as much chance to cause more problems as they do to fix the original situation. Often, the situation is simply more complicated than it appears; true science would expect that hypotheses would be developed, predictions made, experiments performed, results widely reviewed, options analyzed, and consensus established over a long period of time. But when a 'crisis' occurs, too often, this wise course is abandoned.  read more »

A number of years ago, I had the opportunity to attend an excellent lecture by Margaret Thatcher, just after the fall of the Berlin Wall, and the subsequent collapse of the Soviet Union. In it, she indicated that the world was going to be changing radically as a result of those events, and that it was not clear what new direction it would take.

Below is a link to an excellent paper that was presented several weeks ago by Herbert Meyer at a Davos, Switzerland meeting which was attended by most of the CEOs from all the major international corporations. It provides a very good summary of what he considers to be today's key trends, and a number of interesting perspectives that one seldom sees in such analyses.  read more »