What do we know about our ability to manage global systems?

After Umair Haque wrote on our tendency to create bubbles from sub-prime assets, or toxic junk, I set myself to work reading and thinking about the more esoteric academic work on big organizations and disasters.

Karl Weick on Highly Reliable Organizations

Karl Weick, who is not widely quoted, mainly because he is a difficult read, has studied a range of organizations such as nuclear power stations, orchestras and forest fire fighters. Much of what we know about running large organizations, we have learned from him.

The disaster of the banking system, and the very high likelihood that it will sink UK if not the USA, should send us running to Karl Weick’s books for explanations.

This is what I have gleaned:

• When our world gets turned upside down, we go into shock

In the current financial crisis,  Zimbabweans, for example, who have seen a financial meltdown in their recent past, go about saying: yup, seen that before.  They know what to do.  Everyone else is thrown. Nothing makes sense.

• We get into these situations not so much because we are dumb, but because we are lazy

Complicated situations, like nuclear power plants, derivative markets and hedge funds, and for that matter an English roundabout, require our full attention.  We have to be ‘neurotic’ about ‘weak signals’.   We need to notice when little things are wrong and check them out.  We need to listen to each other because we all bring different expertise.

When we start sweeping rubbish under the carpet and deferring to the great and the good, then we are headed for trouble.

This aspect of organizational life is difficult to manage.  Being neurotic about weak signals can just make us opinionated and boorish.  The point about weak signals is attend to those on your own patch.   I’ll give you an example.  In mines and in hotels, when a manager sees a scrap of paper on the floor, they stop to pick it up.  Then they find out how it got there and why it was left there.  We don’t let it go because small things are indicative of system failure.  As a psychologist, I always make a mental note when someone in an organization is agitated. There are dozens of possible causes.  They may simply have remembered they forgot to get the milk and be making a mental plan of what to give the kids for breakfast – not earth shattering.  But they could also be very uncomfortable about a decision at work or have a real crisis outside work and need some space to sort it out.  I only cross them off my list of weak signals when I am sure they are OK.

• We get out of confusing situations by acting.

We bring all our training, past experience and understanding to bear, but the truth is that we may not have experienced anything like this before or what worked in the past may be misleading.

Moreover the situation is evolving as we think and plan.

So we begin to act, we watch the consequences of our actions.  We leap so that we can look.

Acting without knowing is terrifying.  So wise organizations prepare people.  We get them to rehearse likely scenarios.  We also put them in situations where they don’t know everything.   That’s why gap years and study abroad is so valuable.  We learn to cope with our emotions when we don’t know what is happening!

What’s clear for a manager is that we must get people to act.  Some act easily – perhaps too easily.  Many are over cautious.  The trick is to give people little things to do.  When we administer psychological tests, for example, we don’t give a long explanation.  We want people to act within 20 to 30 seconds.  Wkeep things brief. Hello, I am  .  .  .  We will be here all morning doing some exercises.  I’ll guide you through everything.  Would you like to sit down here and write your name on the first bit of paper?  And then we got straight into a 2 minute exercise which is designed to be easy, burn off some adrenaline, and give them a practical overview of what will follow.  Their subsequent scores are much higher for reducing endless cogitation and allowing them to learn from action.  Weick even cites a situation where an army unit in the mountains got “unlost” by following a map of another mountain range.  A manger’s job is to get people to collect relevant information, act on it, collect more, act on it, etc.

Collective mindfulness

I like the term collective mindfulness because it refers to a culture where all three points are incorporated.

• We respond to weak signals and we build our attention to weak signals into the culture by modeling mindfulness and listening to every one.
• We accept that surprises shock us and reduce our ability to act.
• We get everyone up and about finding relevant information and sharing it.

Collective mindfulness increases belonging

What Weick doesn’t seem to say, but might have done, is that the feeling of inclusion and shared purpose will also release cognitive capacity.  Just as we should never ignore weak signals, when we are in a good mood, it is easier to spot what does work and do more of it.   When we belong, we don’t have to worry about finding a group which will be loyal to us.

In a complicated system, freeing up that cognitive space and doing more of what works might preempt disaster.

That’s me done for this Sunday.

I am relieved. We can manage our collective affairs.  We can work effectively in a globalized, internet-connected world.

• Attention to detail no matter its source!
• Manage shock with action
• Act to reveal information relevant to the common and valued purpose

P.S.  As I looked for a mnenomic, I noticed that these are the same three factors modelled by Marcial Losada in business teams:

• Inquiry-Advocacy>1  [Ask questions; summarize; ask questions]
• Positive:Negative speech > 5:1 [Ask what needs to be done; don’t wallow in negative emotion]
• Reference to the world outside the group – Reference to the world inside the group >1 [Find out what matters!  Don’t just theorize]

Ah, social scientists are repetitive – why don’t we just do this stuff?