The problem with INTEGRATION

[PART I]

Our view on the fundamental problem with integration is that the word does not contain the 4Cs of essential successful outcomes:

  • Communication
  • Change Management effort
  • Control and Coordination
backdrop-blue-technology-gear
 
Effective COMMUNICATION strategies and plans
 
We know the word good or effective communication is banded around quite frequently, however, this brief analysis of the process will hopefully highlight the challenge we see in effective communication of the change effort required, in order to lead to a successful Integration project.
  1. Communication is multi-dimensional
  2. Communication is multi-channel
  3. Communication is a two way (one to one) or one to many process
  4. Communication requires time, an action plan and monitoring and control
  5. Communication requires a feedback loop mechanism to measure outcomes
The list above is by no means exhaustive, however, in the next article in this series, we will focus on each element of the communication process in turn.
Change Management effort
 
In the animal kingdom, if you stand still for too long, the chances are that some predator or other will catch and consume you.  In organisational life the same principles apply.  Those who accept the Status Quo for too long will become endangered and their organisations will suffer.  So, with change so endemic in organisational life, why are we still so bad at managing overall Change Management effort and process?
Even when we put Change Management front and centre in the INTEGRATION process; why does it still depend on a coin toss as to the likelihood of a successful outcome?
We believe that part of the answer lies in a fundamental misalignment and misunderstanding of ‘COMPETING PRIORITIES‘.
priorities
And this comes back to the communication processes and strategies deploy in the first place.
If we do not communicate what and why the urgencies exist and what the critical drivers for and against change are; do we believe we have any hope of a positive outcome?
People in organisations are generally very busy.  They consume, process, create, oversee, manage, do, etc., etc. a lot of information and tasks, constantly shifting priorities in an ocean of decision making and information flows.
If any Change effort and Change Management specialist does not understand and compensate for this factor, is it any wonder that INTEGRATION and Change Management efforts are less than optimal?
Control and Coordination
 
Like any process, control of the process itself and coordination and monitoring of the effort (resources deployed) is an essential part of driving the INTEGRATION agenda forward.
Deming’s Plan-Do-Check-Act cycle is a useful guide in this area of control and coordination.  The two words, however, do not mean the same outcome will be achieved in the end.
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A clear distinction needs to be made between Efficiency and Effectiveness when controlling and coordinating INTEGRATION projects.
We have all heard the ‘busy fools’ analogy and if not, we have to guard against efficiently doing the wrong thing.  Sometimes decision-making is carried out in an environment where information is lacking and if the ‘gut feel’ is not followed in favour of imperfect information, then sub-optimal decisions can be perpetuated by continuing to justify the original decision point.
We are reminded here of a phrase in a stanza from Felix Dennis’ poem, ‘How to Get Rich’:
 “Never be late 
to quit or cut bait
 
CutBait-home-page-2014
In our next article on the topic of INTEGRATION management, we will continue the conversation regarding COMMUNICATION and continue to delve down deeper into analysis and commentary on the 4Cs of the Integration effort, namely

Communication

Change Management effort

Control and Coordination 

 ….to be continued in part II

© theMarketSoul 2015

Panic in the Cars of Britain?

With apologies to The Smiths; the original version of the song Panic’s lyrics reads something like this:

“Panic on the streets of London / Panic on the streets of Birmingham / I wonder to myself / Could life ever be sane again?”

Panic (The Smiths song)
Panic (The Smiths song) (Photo credit: Wikipedia)

Or is this the beginning of what we will call ‘Austerity Anarchy’?

As a case study in behavioural economics goes, the last week in March 2012, in the UK must go down as a classic…

United Kingdom
United Kingdom (Photo credit: stumayhew)

What sparked the ‘run on petrol and filling stations’ is not the aim of our analysis, but rather the deeper underlying cultural psychosis affecting Austerity Britain.  However, the austerity is not driven by the current revenue expenditure austerity, but rather the culture of Investment Austerity over many decades that has created a supply chain time bomb in the UK.

There is generally a severe lack of investment in any form of storage capacity.  Not as a risk management concept, but rather as a pure short sighted cost management issue.

Yes, land capacity is limited on a small (in places patchily overcrowded; especially down in the South East of England) island and the cost of owning a vast storage network must seem prohibitive; yet having so little risk management or rather ‘buffer’ and shock absorption capacity available must be the vast hidden opportunity cost ‘time bomb’ waiting to derail a sustained or sustainable short run upturn in the economy?

Hidden or in the economists parlance ‘Opportunity Cost’ is generally not an item on any policy maker’s agenda, yet in it lies the ‘unintended consequences’ element that so seldom gets factored into the equation.  Yet opportunity cost highlights the risk element we have to factor in.  And in this sense we use the word RISK in its proper intended format, namely a quantifiable probabilistic evaluation of the downside of a transaction.  Yes, threats are more closely aligned to ‘unintended consequences’ and are the issues we can only subjectively be aware of, but cannot quantify with any degree of accuracy.

Risk Management road sign
Risk Management road sign (Photo credit: Wikipedia)

Hence, ‘Austerity Anarchy’ is what we believe an angst and siege mentally is, when decision-making (or rather calculus driven decision-making) gets ‘suspended’ and the irrationality of “mankind’s mind” and the mainstream misinformation distribution takes over, creating PANIC in Little Britain and the commentators at theMarketSoul ©1999 – 2012 ask themselves:

I wonder to myself;  could life ever be sane again?” – with thanks to The Smiths

 

theMarketSoul ©2012

A new Commercial Reality under Austerity

How to compete fairly and openly.  [Part of our ‘The Trouble with Innovation series 1,2,3,4,5 – Part 6]

Doing business anywhere, anytime is never easy!

That is a stark commercial reality, that most business people will accept as a given.  But how? now? does is work in a climate of AUSTERITY???

(Apologies for the blatant confusion and poetic licence taken in the previous sentence).

Public and private sectors mostly have an uneasy symbiotic relationship with each other.  If the public sector cannot deliver a solution, they have to procure it from a private provider and a private provider (generally, but not always) rub their hands with glee, as it is relatively speaking ‘easy money’ provided you meet and exceed certain framework thresholds.

All nice and cosy, when we are in a growth cycle of the economy; yet ever so tricky when those Framework Procurement Agreements come up for tender during the down slope side of the cycle…

Business Cycle
Image via Wikipedia

It is odd how the ‘staccato’ relationship between private and public sectors work at different periods during the business cycle.  And this is exactly where the public sector, with an astute “commercial hat” on, can take advantage of it’s perceived negotiating strength during the down cycle agreement drafting / tendering process.

Yet, do they take advantage of this? 

Our view is that any Public Sector Procurement Framework Agreement with private sector providers will always be a FLOOR, thereby setting the minimum expectations and requirements, without ever really driving proper continuous INNOVATION and COMPETITIVE DYNAMICS to ensure players with ‘skin in the game’ continue to understand and manage their businesses with the proper risk attitude (never mind risk appetite).  Rather than act as a (“floor price”) barrier to entry, they should act as ceiling, or rather more ‘bluish sky’ REACH or STRETCH agreements, setting the rules of the game, but not acting as the default pricing mechanism , meaning that the private sector provider must continue to be innovative, rather than wait and ‘cream-off’ the best bits whilst seeing out the agreement time period until the next time anyone bothers to ‘tamper with the height’ of the limbo bar…

Our summary take away from this article:

The Public Sector Procurement Framework Agreement therefore should act as an incentive to compete and have fair access, but never as the default pricing mechanism.

Community and Public Sector Union Pledge Signi...
Community and Public Sector Union Pledge Signing 20th August 2010 (Photo credit: Senator Kate Lundy)

theMarketSoul ©2012

The Big Design: Moral Hazard, and the EU

Irrespective of how the twists and turns of the Greek political system plays out over the next few days and weeks, we believe that the Big EU (Eurozone more specifically) players and their leaders only have themselves to blame for Greece‘s seemingly petulant behaviour.

If at the fundamental level we cannot understand that ANY form of bail-out will always support and lead to Moral Hazard, then we have learnt nothing from the past and the more recent debt and financial crisis of the 2008.

Previously we mentioned the ‘Credit Quake’ with lots of after tremors (attributed to Dennis Cox of Risk Reward), will last for a number of years and this is exactly what we have playing out as daily deadlines in front of our eyes at the moment.

However, to return to the point at hand:  The age of economic dilemma of Moral Hazard has reared its monstrous head again and is in danger of ‘nabbing us in the butt’ (yet again), because the leaders of the EU (more specifically the Eurozone 17) do not want to understand that all their actions in supporting Greece is only leading to a more dangerous form of Moral Hazard and flies in the face of the Austrian School‘s ideas of ‘Creative Destruction‘.

Without effective mechanisms in place to deal with European regions at different cycles of development (not even to mention the basic lack of sound  fiscal management), is to ask for problems (on a continuous basis).

Until a sound framework of either full fiscal and monetary union with appropriate checks and balances are rolled out in Europe, with a single capital market instrument (Gilt / Bond or EuroBond) and mechanisms for dealing with localised ‘failures’ of the market to clear itself effectively (never mind efficiently); we will continue to wretch and lurch about with market confidence eroded and leaders running around like headless chickens trying and implementing inappropriate tools for the job a sound framework is supposed to deal with.

It is not more regulation we want.  It is simply BETTER regulation.  It is that simple.

theMarketSoul ©2011

Quantitative Easing – Here we go again

A reminder of what we wrote on 22 September 2011 about Quantitative Easing: “QE – Our take on the Bell Curve Effect” (Please click on the link for the full article).

 

Expect Mervin King to continue writing letters to the Chancellor to explain the Inflation target gap and the worsening economic landscape.   It begs the question:  Are the Central Bankers competent enough to sterr us through troubled waters again?

The key issue really is the lag effects before QE starts working…

theMarketSoul ©2011

The Seven Deadly Sins of the Market

As if last week’s (week ending 23 September 2011) turbulence on the world’s stock markets wasn’t enough of an emotional rollercoaster for millions of market participant’s, we will offer only one bit of reflection this morning on the market conditions.

Remember, the markets live, breath and die by the age old human conditions (seven deadly sins) of:

  • Greed / Avarice (Avaritia)
  • Envy (invidia)
  • Gluttony (gula)
  • Sloth (acedia)
  • Wrath (ira)
  • Pride (superbia)
  • Lust (luxuria

Therefore, the markets are Harsh, as we have written about before, however markets are still the most open, free and fair way to allocate resources, as we are reaching out to establish with our ‘The Market eQuation’, investigation.

All this activity we hope and trust will lead to a new understanding of the market which we will call:

Unbounded Market Rationality

theMarketSoul ©2011

The economics of Gap (Interim) or Freelance Management

We thought it about time to write an opinion piece on the dynamics (economics) around the Interim Management market, delivered from a UK perspective.

This is a purely thought piece and opinion, not support by empirical research, but grounded in economic theory and an observation of the ‘state of the current market’.

The inspiration for this is an article we published last year entitled “Increased Friction Costs“. For background on the meaning and usage of Friction Costs, please refer to the definitions used in the original article.

Let’s face facts. Interim Management was borne out of the margins of Friction Costs. Filling the gap that naturally exists where ‘full employment’ is just never possible. Highly skilled and mobile individuals. However, this is also exactly where the rub sits. IM was borne on the ‘margins’ of the bell curve and not in the middle of that curve. Whether it is natural friction or crisis friction that drives it, the fundamental principle of IM is scarcity, flexibility and mobility. Items that typically cannot be addressed in rigid Labour Market framework and market conditions.

So what has changed?

Well, that scarcity has become mainstream. Evidence for this is the IIM survey results, listing at least 600 ‘claimed’ Interim Service Providers in the REC Directory. Or, maybe the definitions have become blurred. Plenty of anecdotal evidence for this exists on and in discussions in this forum.

Too many Interim Service Providers (ISPs) and too many would be Interim Managers (IMs) have flocked to the margins of the bell curve and confused the message, for both would be clients, ISPs and IM themselves.

Calls for the EIM (Executive Interim Management) label are attempts to create another differentiator. Accreditation itself is another differentiator and this is something the IIM supports and is seeking to grow, particularly with the Agency Workers Regulations in mind.

Basically, in order to add value, we need to realise that there is a ‘natural market’ for IMs, but at the moment that natural market is flooded with confused messages, symbols, participants, etc.

Any comments and opposing views are welcomed.

theMarketSoul ©1999 – 2011